v2.3.0.11
Document and Entity Information
 9 Months Ended
Dec. 31, 2011
Feb. 13, 2012
Document and Entity Information    
Document Type 10-Q  
Amendment Flag false  
Document Period End Date Dec. 31, 2011
Trading Symbol crpz  
Entity Registrant Name Convenience TV Inc.  
Entity Central Index Key 0001454719  
Current Fiscal Year End Date --03-31  
Entity Filer Category Smaller Reporting Company  
Entity Common Stock, Shares Outstanding   105,647,684
Entity Current Reporting Status Yes  
Entity Voluntary Filers No  
Entity Well Known Seasoned Issuer No  
Document Fiscal Year Focus 2012  
Document Fiscal Period Focus Q3  
 v2.3.0.11
Statement of Financial Position (USD $)
Dec. 31, 2011
Mar. 31, 2011
Current Assets    
Cash $ 1,128 $ 51,518
Due from related party 19,161 19,161
Total Current Assets 20,289 70,679
Property and equipment 4,562 37,140
Deferred financing costs 2,867 3,472
Total Assets 27,718 111,291
Current Liabilities    
Accounts payable 23,378 3,324
Accrued liabilities 12,356 2,155
Convertible debt, less unamortized discount of $60,812 62,188 63,065
Derivative liabilities 133,148 0
Total Liabilities 231,070 68,544
Stockholders' Equity (Deficit)    
Preferred Stock Authorized: 100,000,000 preferred shares, $0.00001 par value Issued and outstanding: no shares 0 0
Common Stock Authorized: 600,000,000 common shares, $0.00001 par value Issued and outstanding: 97,769,272 shares (March 31, 2011 - 56,070,000) 979 561
Additional paid-in capital 1,061,629 788,025
Deficit accumulated during the development stage (1,265,960) (745,839)
Total Stockholders' Equity (Deficit) (203,352) 42,747
Total Liabilities and Stockholders' Equity (Deficit) $ 27,718 $ 111,291
 v2.3.0.11
Statement of Financial Position (Parenthetical) (USD $)
Dec. 31, 2011
Mar. 31, 2011
Convertible Debt Instrument Unamortized Discount $ 60,812 $ 0
Preferred Stock, Shares Authorized 100,000,000 100,000,000
Preferred Stock, Par Value Per Share $ 0.00001 $ 0.00001
Preferred Stock, Shares Issued    
Preferred Stock, Shares Outstanding    
Common Stock, Shares Authorized 600,000,000 600,000,000
Common Stock, Par Value Per Share $ 0.00001 $ 0.00001
Common Stock, Shares, Issued 97,769,272 56,070,000
Common Stock, Shares, Outstanding 97,769,272 56,070,000
 v2.3.0.11
Statement of Operations (USD $)
 3 Months Ended 9 Months Ended 45 Months Ended
Dec. 31, 2011
Dec. 31, 2010
Dec. 31, 2011
Dec. 31, 2010
Dec. 31, 2011
Revenue $ 0 $ 0 $ 6,628 $ 0 $ 20,954
Expenses          
Amortization 10,282 13,090 32,578 39,131 151,254
Consulting fees 22,098 2,500 28,098 13,800 41,298
Content services 0 0 0 0 6,470
Foreign exchange loss (gain) 384 95 309 (2,705) 17,359
Investor relations 0 4,140 0 94,140 112,840
Management fees 4,500 30,000 34,500 80,000 270,805
Network management 3,962 17,510 34,000 75,083 178,245
Office and general 328 2,972 2,964 7,071 17,760
Professional fees 11,368 11,931 41,777 49,937 90,590
Transfer agent and filing fees 2,964 6,276 12,958 12,798 21,746
Travel and promotion 40 63 220 63 24,331
Total Operating Expenses 55,926 88,577 187,404 369,318 932,698
Loss from Operations (55,926) (88,577) (180,776) (369,318) (911,744)
Other Income (Expense)          
Accretion of discounts on convertible debt (15,002) (1,446) (98,628) (1,446) (109,316)
Amortization of deferred financing costs (1,704) 0 (5,605) 0 (7,633)
Interest expense (2,965) (362) (7,045) (362) (9,200)
Gain (loss) on change in fair value of derivative liabilities 335,058 0 (193,196) 0 (193,196)
Loss on extinguishment of debt (34,871) 0 (34,871) 0 (34,871)
Total Other Income (Expense) 280,516 (1,808) (339,345) (1,808) (354,216)
Net Income (Loss) for the Period $ 224,590 $ (90,385) $ (520,121) $ (371,126) $ (1,265,960)
Net Earnings (Loss) Per Share, Basic and Diluted     $ (0.01) $ (0.01)  
Weighted Average Shares Outstanding 82,270,000 56,070,000 66,569,000 52,857,000  
 v2.3.0.11
Statement of Cash Flows (USD $)
 9 Months Ended 45 Months Ended
Dec. 31, 2011
Dec. 31, 2010
Dec. 31, 2011
Operating Activities      
Net loss $ (520,121) $ (371,126) $ (1,265,960)
Adjustments to reconcile net loss to net cash used in operating activities:      
Accretion of discounts on convertible debt 98,628 1,446 109,316
Amortization of property and equipment 32,578 39,131 151,254
Amortization of deferred financing costs 5,605 0 7,633
Loss on change in fair value of derivative liabilities 193,196 0 193,196
Loss on extinguishment of debt 34,871 0 34,871
Stock-based compensation 9,598 90,000 99,598
Changes in operating assets and liabilities:      
Due from related party 0 0 (19,161)
Prepaid expenses 0 8,457 0
Accounts payable 20,054 (1,687) 20,424
Accrued liabilities 10,201 (775) 12,356
Net Cash Used In Operating Activities (115,390) (234,554) (656,473)
Investing Activities      
Acquisition of property and equipment 0 0 (155,816)
Net cash acquired on acquisition of subsidiary 0 6,755 6,755
Net Cash Provided By (Used In) Investing Activities 0 6,755 (149,061)
Financing Activities      
Advances from related party 0 0 348,482
Proceeds from convertible debt 65,000 55,000 162,500
Deferred financing costs 0 0 (5,500)
Proceeds from issuance of common stock 0 278,700 278,701
Net Cash Provided By Financing Activities 65,000 333,700 784,183
Effect of Exchange Rate Changes on Cash 0 (17,063) 22,479
Change in Cash (50,390) 88,838 1,128
Cash, Beginning of Period 51,518 0 0
Cash, End of Period 1,128 88,838 1,128
Supplemental Disclosures:      
Interest paid 0 0 0
Income taxes paid $ 0 $ 0 $ 0
 v2.3.0.11
Basis of Presentation
 9 Months Ended
Dec. 31, 2011
Basis of Presentation [Text Block]
1.

Basis of Presentation

   
 

The accompanying financial statements of Convenience TV Inc. (the “Company”) should be read in conjunction with the consolidated financial statements and accompanying notes filed with the U.S. Securities and Exchange Commission in the Company’s Annual Report on Form 10-K for the fiscal year ended March 31, 2011. In the opinion of management, the accompanying consolidated financial statements reflect all adjustments of a recurring nature considered necessary to present fairly the Company’s financial position and the results of its operations and its cash flows for the periods shown.

   
 

The preparation of financial statements in accordance with accounting principles generally accepted in the United States requires management to make estimates and assumptions that affect the amounts reported. Actual results could differ materially from those estimates. The results of operations and cash flows for the periods shown are not necessarily indicative of the results to be expected for the full year.

   
 

These financial statements have been prepared on a going concern basis, which implies the Company will continue to realize its assets and discharge its liabilities in the normal course of business. The Company has not generated significant revenues since inception and is unlikely generate earnings in the immediate or foreseeable future. The continuation of the Company as a going concern is dependent upon the continued financial support from its shareholders, the ability of the Company to obtain necessary equity financing to continue operations, and the attainment of profitable operations. As at December 31, 2011, the Company has not generated significant revenues, has a working capital deficit of $210,781, and has accumulated losses of $1,265,960 since inception. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern. These financial statements do not include any adjustments to the recoverability and classification of recorded asset amounts and classification of liabilities that might be necessary should the Company be unable to continue as a going concern.

 v2.3.0.11
Recent Accounting Pronouncements
 9 Months Ended
Dec. 31, 2011
Recent Accounting Pronouncements [Text Block]
2.

Recent Accounting Pronouncements

   
 

In January 2010, the FASB issued an amendment to ASC 820, “Fair Value Measurements and Disclosures”, to require reporting entities to separately disclose the amounts and business rationale for significant transfers in and out of Level 1 and Level 2 fair value measurements and separately present information regarding purchase, sale, issuance, and settlement of Level 3 fair value measures on a gross basis. This standard is effective for interim and annual reporting periods beginning after December 15, 2009 with the exception of disclosures regarding the purchase, sale, issuance, and settlement of Level 3 fair value measures which are effective for fiscal years beginning after December 15, 2010. The adoption of the applicable standard on April 1, 2011 did not have a material effect on the Company’s consolidated financial statements.

   
 

The Company has implemented all new accounting pronouncements that are in effect and that may impact its financial statements and does not believe that there are any other new accounting pronouncements that have been issued that might have a material impact on its financial position or results of operations.

 v2.3.0.11
Property and Equipment
 9 Months Ended
Dec. 31, 2011
Property and Equipment [Text Block]
3.

Property and Equipment


                  December 31,     March 31,  
                  2011     2011  
            Accumulated     Net Carrying     Net Carrying  
      Cost     Amortization     Value     Value  
      $      $      $      $   
  Computer equipment   16,147     16,147     –     1,517  
  Equipment   139,669     135,107     4,562     35,623  
      155,816     151,254     4,562     37,140  

 
 v2.3.0.11
Convertible Debt
 9 Months Ended
Dec. 31, 2011
Convertible Debt [Text Block]
4.

Convertible Debt

     
  (a)

On December 3, 2010, the Company issued a $55,000 convertible note which bears interest at 8% per annum and matures on September 3, 2011. The note is convertible into shares of common stock 180 days after the date of issuance (June 1, 2011) at a conversion rate of 58% of the average of the three lowest closing bid prices of the Company’s common stock for the ten trading days ending one trading day prior to the date the conversion notice is sent by the holder to the Company. On July 25, 2011, the conversion rate was amended to 31% of the average of the three lowest closing bid prices of the Company’s common stock for the ten trading days ending one trading day prior to the date of conversion. Upon an event of default, the entire principal balance and accrued interest outstanding is due immediately, and interest shall accrue on the unpaid principal balance at 22% per annum.

     
   

In accordance with ASC 470-20, “Debt with Conversion and Other Options”, the Company recognized the intrinsic value of the embedded beneficial conversion feature of $16,019 as additional paid-in capital and an equivalent discount which will be charged to operations over the term of the convertible note. On June 1, 2011, the Company recorded a derivative liability of $89,014 and a further discount of $38,981 which will be charged to operations over the term of the convertible note. During the nine months ended December 31, 2011, the Company issued 41,699,272 shares of common stock pursuant to the conversion of $44,500 of the convertible note. The fair value of the conversion option derivative liability related to this converted amount of $157,548 was recorded as additional paid-in capital. As at December 31, 2011, $10,500 had been accreted increasing the carrying value of the convertible note to $10,500. During the nine months ended December 31, 2011, the Company recorded a loss on the change in fair value of the conversion option derivative liability of $128,936 and as of December 31, 2011, the fair value of the conversion option derivative liability was $26,385.

     
  (b)

On January 14, 2011, the Company issued a $42,500 convertible note which bears interest at 8% per annum and matures on October 18, 2011. The note is convertible into shares of common stock 180 days after the date of issuance (July 13, 2011) at a conversion rate of 58% of the average of the three lowest closing bid prices of the Company’s common stock for the ten trading days ending one trading day prior to the date the conversion notice is sent by the holder to the Company. On July 25, 2011, the conversion rate was amended to 31% of the average of the three lowest closing bid prices of the Company’s common stock for the ten trading days ending one trading day prior to the date of conversion. Upon an event of default, the entire principal balance and accrued interest outstanding is due immediately, and interest shall accrue on the unpaid principal balance at 22% per annum.

     
   

In accordance with ASC 470-20, “Debt with Conversion and Other Options”, the Company recognized the intrinsic value of the embedded beneficial conversion feature of $29,105 as additional paid-in capital and an equivalent discount which will be charged to operations over the term of the convertible note. On July 13, 2011, the Company recorded a derivative liability of $60,250 and a further discount of $13,395 which will be charged to operations over the term of the convertible note. The Company records accretion expense over the term of the convertible note up to its face value of $42,500. As at December 31, 2011, $42,500 had been accreted increasing the carrying value of the convertible note to $42,500. During the nine months ended December 31, 2011, the Company recorded a loss on the change in fair value of the conversion option derivative liability of $64,260 and as of December 31, 2011, the fair value of the conversion option derivative liability was $106,763.

     
  (c)

On July 26, 2011, the Company issued a $37,500 convertible note which bears interest at 8% per annum and matures on April 30, 2012. The note is convertible into shares of common stock 180 days after the date of issuance (January 22, 2012) at a conversion rate of 58% of the average of the three lowest closing bid prices of the Company’s common stock for the ten trading days ending one trading day prior to the date the conversion notice is sent by the holder to the Company. Upon an event of default, the entire principal balance and accrued interest outstanding is due immediately, and interest shall accrue on the unpaid principal balance at 22% per annum.

     
   

In accordance with ASC 470-20, “Debt with Conversion and Other Options”, the Company recognized the intrinsic value of the embedded beneficial conversion feature of $37,500 as additional paid-in capital and an equivalent discount which will be charged to operations over the term of the convertible note. The Company records accretion expense over the term of the convertible note up to its face value of $37,500.

     
   

On October 6, 2011, the conversion rate was amended to be 35% of the average of the three lowest closing bid prices of the Company’s common stock for the ten trading days ending one trading day prior to the date of conversion.

     
   

In accordance with ASC 470-60, “Debt - Troubled Debt Restructurings by Debtors”, the Company determined that the creditor did not grant a concession as the only modification to the debt was the decrease in the conversion price.

     
   

The modification was then analyzed under ASC 470-50, “Debt - Modifications and Extinguishments”. The change of the fair value of the conversion feature was greater than 10% of the carrying value of the debt. As a result, in accordance with ASC 470-50, the Company determined the terms of the amendment to be substantially different and treated the July 26, 2011 convertible note extinguished and exchanged for a new convertible note. The Company recorded a loss on extinguishment of debt of $34,871.

     
   

Prior to the modification, the Company recorded $2,629 of accretion expense related to the original convertible debt, and the carrying value of the original note was $2,629 at October 6, 2011. In accordance with ASC 470-20, “Debt with Conversion and Other Options”, the Company recognized the intrinsic value of the embedded beneficial conversion feature of $37,500 as additional paid-in capital and an equivalent discount which will be charged to operations over the term of the modified convertible note. The Company will record accretion expense over the term of the modified convertible note up to its face value of $37,500.

     
   

As at December 31, 2011, the Company recorded $6,991 of accretion expense related to the modified convertible note increase the carrying value of the convertible note to $6,991.The Company paid $8,000 in financing costs relating to the convertible debt.

     
  (d)

On October 12, 2011, the Company issued a $32,500 convertible note which bears interest at 8% per annum and matures on July 17, 2012. The note is convertible into shares of common stock 180 days after the date of issuance (April 10, 2011) at a conversion rate of 35% of the average of the three lowest closing bid prices of the Company’s common stock for the ten trading days ending one trading day prior to the date the conversion notice is sent by the holder to the Company. Upon an event of default, the entire principal balance and accrued interest outstanding is due immediately, and interest shall accrue on the unpaid principal balance at 22% per annum.

     
   

In accordance with ASC 470-20, “Debt with Conversion and Other Options”, the Company recognized the intrinsic value of the embedded beneficial conversion feature of $32,500 as additional paid-in capital and an equivalent discount which will be charged to operations over the term of the convertible note. The Company records accretion expense over the term of the convertible note up to its face value of $32,500.

     
   

As at December 31, 2011, $2,197 had been accreted increasing the carrying value of the convertible note to $2,197. The Company paid $2,500 in financing costs relating to the convertible debt.

     
  (e)

The Company paid a total of $10,500 in financing costs relating to the above convertible debt. As at December 31, 2011, the Company had deferred financing costs of $2,867 (March 31, 2011 – $3,472).

 v2.3.0.11
Derivative Liability
 9 Months Ended
Dec. 31, 2011
Derivative Liability [Text Block]
5.

Derivative Liabilities

The conversion options of the convertible debt disclosed in Notes 4(a) and 4(b) are required to record a derivative at their estimated fair values on each balance sheet date with changes in fair value reflected in the statement of operations.

The fair value of the derivative liability for the December 3, 2010 convertible note was $89,014 on vesting. The fair value of the derivative liability for the January 14, 2011 convertible note was $60,250 on vesting.

The fair values of these convertible notes as at December 31, 2011 and March 31, 2011 are as follows:

      December 31,     March 31,  
      2011     2011  
      $      $   
               
   $10,500 convertible debenture issued December 3, 2010   26,385     –  
   $42,500 convertible debenture issued January 14, 2011   106,763     –  
      133,148     –  
               
  During the nine months ended December 31, 2011, the Company recorded a loss on the change in fair value of the derivative liabilities of $193,196.
   
  The Company uses the Black-Scholes option pricing model to calculate the fair values of the derivative liabilities. The following table shows the assumptions used in the calculations:
   
            Risk-free     Expected     Expected  
      Expected     Interest     Dividend     Life (in  
      Volatility     Rate     Yield     years)  
  December 3, 2010 convertible note:                        
  As at June 1, 2011 (date of vesting)   388%     0.05%     0%     0.26  
                           
  January 14, 2011 convertible note:                        
  As at July 13, 2011 (date of vesting)   392%     0.01%     0%     0.27  
                           
  As at December 31, 2011   326%     0.02%     0%     0.25  
 v2.3.0.11
Related Party Transactions
 9 Months Ended
Dec. 31, 2011
Related Party Transactions [Text Block]
6.

Related Party Transactions


  (a)

As at December 31, 2011, the Company is owed $19,161 (March 31, 2011 – $19,161) from a company under common control which is unsecured, non-interest bearing and due on demand.

     
  (b)

During the nine months ended December 31, 2011, the Company paid $17,500 (2010 - $40,000) in management fees to a company controlled by the President of the Company.

     
  (c)

During the nine months ended December 31, 2011, the Company paid $17,000 (2010 - $40,000) in management fees to the Chief Financial Officer of the Company.

 v2.3.0.11
Common Stock
 9 Months Ended
Dec. 31, 2011
Common Stock [Text Block]
7.

Common Stock

     
  (a)

Effective July 20, 2011, the Company increased the authorized number of shares of common stock from 100,000,000 to 600,000,000 shares, with no change in par value.

     
  (b)

On June 10, 2011, the Company issued 1,690,141 shares of common stock pursuant to the conversion of $12,000 of the convertible note described in Note 4(a). The fair value of the conversion option was determined to be $35,830 on the date of conversion and was recorded as additional paid-in capital.

     
  (c)

On August 10, 2011, the Company issued 2,500,000 shares of common stock pursuant to the conversion of $4,000 of the convertible note described in Note 4(a). The fair value of the conversion option was determined to be $14,291 on the date of conversion and was recorded as additional paid-in capital.

     
  (d)

On August 22, 2011, the Company issued 2,500,000 shares of common stock pursuant to the conversion of $3,000 of the convertible note described in Note 4(a). The fair value of the conversion option was determined to be $7,113 on the date of conversion and was recorded as additional paid-in capital.

     
  (e)

On September 15, 2011, the Company issued 2,500,000 shares of common stock pursuant to the conversion of $1,500 of the convertible note described in Note 4(a). The fair value of the conversion option was determined to be $8,881 on the date of conversion and was recorded as additional paid-in capital.

     
  (f)

On September 20, 2011, the Company issued 2,500,000 shares of common stock pursuant to the conversion of $1,500 of the convertible note described in Note 4(a). The fair value of the conversion option was determined to be $6,238 on the date of conversion and was recorded as additional paid-in capital.

     
  (g)

On October 14, 2011, the Company issued 2,777,778 shares of common stock pursuant to the conversion of $2,500 of the convertible note described in Note 4(a). The fair value of the conversion option was determined to be $6,533 on the date of conversion and was recorded as additional paid-in capital.

     
  (h)

On October 20, 2011, the Company issued 2,857,143 shares of common stock pursuant to the conversion of $2,000 of the convertible note described in Note 4(a). The fair value of the conversion option was determined to be $13,090 on the date of conversion and was recorded as additional paid-in capital.

     
  (i)

On October 21, 2011, the Company issued 2,857,143 shares of common stock pursuant to the conversion of $2,000 of the convertible note described in Note 4(a). The fair value of the conversion option was determined to be $8,640 on the date of conversion and was recorded as additional paid-in capital.

     
  (j)

On October 31, 2011, the Company issued 2,857,143 shares of common stock pursuant to the conversion of $2,000 of the convertible note described in Note 4(a). The fair value of the conversion option was determined to be $7,082 on the date of conversion and was recorded as additional paid-in capital.

     
  (k)

On November 10, 2011, the Company issued 3,424,658 shares of common stock pursuant to the conversion of $2,500 of the convertible note described in Note 4(a). The fair value of the conversion option was determined to be $6,675 on the date of conversion and was recorded as additional paid-in capital.

     
  (l)

On November 21, 2011, the Company issued 3,571,429 shares of common stock pursuant to the conversion of $2,500 of the convertible note described in Note 4(a). The fair value of the conversion option was determined to be $14,588 on the date of conversion and was recorded as additional paid-in capital.

     
  (m)

On December 1, 2011, the Company issued 3,684,211 shares of common stock pursuant to the conversion of $3,500 of the convertible note described in Note 4(a). The fair value of the conversion option was determined to be $9,987 on the date of conversion and was recorded as additional paid-in capital.

     
  (n)

On December 13, 2011, the Company issued 3,947,368 shares of common stock pursuant to the conversion of $3,000 of the convertible note described in Note 4(a). The fair value of the conversion option was determined to be $11,210 on the date of conversion and was recorded as additional paid-in capital.

     
  (o)

On December 22, 2011, the Company issued 4,032,258 shares of common stock pursuant to the conversion of $2,500 of the convertible note described in Note 4(a). The fair value of the conversion option was determined to be $7,390 on the date of conversion and was recorded as additional paid-in capital.

 v2.3.0.11
Stock Options
 9 Months Ended
Dec. 31, 2011
Stock Options [Text Block]
8.

Stock Options

On October 18, 2011, the Company granted 4,000,000 stock options to consultants, employees and a director which are exercisable at $0.0024 per share and expire on October 18, 2013. The fair value of these stock options was estimated at the date of grant using the Black-Scholes option-pricing model assuming an expected life of 2 years, a risk-free rate of 0.05%, an expected volatility of 522%, and a 0% dividend yield. The weighted average fair value of stock options granted was $0.0024 per share.

During the nine month period ended December 31, 2011, the Company recorded stock-based compensation of $9,598 (2010 - $nil), as consulting fees.

A summary of the Company’s stock option activity is as follows:

            Weighted        
            Average       Aggregate  
            Exercise     Intrinsic  
      Number of     Price     Value  
      Options     $      $   
  Outstanding, March 31, 2011   –              
     Granted   4,000,000     0.0024        
  Outstanding and exercisable, December 31, 2011   4,000,000     0.0024     –  

As at December 31, 2011, the weighted average remaining contractual life was 1.8 years and there was no unrecognized compensation costs related to non-vested share-based compensation.

 v2.3.0.11
Acquisition of C-Store Network, LLC
 9 Months Ended
Dec. 31, 2011
Acquisition of C-Store Network, LLC [Text Block]
9.

Proposed Acquisition

During the nine months ended December 31, 2011, the Company entered into a Letter of Intent with HFT Management Inc. (“HFT”) to purchase the static advertising business known as Go Media for $2,000,000 to be paid in cash. The terms and conditions will be outlined in an Asset Purchase Agreement. In conjunction with the closing of the Asset Purchase Agreement, the parties will sign an agreement with HFT to manage the acquired static advertising business. As of December 31, 2011, the transaction had not been completed.

 v2.3.0.11
Subsequent events
 9 Months Ended
Dec. 31, 2011
Subsequent events [Text Block]
10.

Subsequent Events


  (a)

On January 10, 2012, the Company signed a term sheet for a $3,250,000 credit facility to finance the acquisition of Go Media. The term of the financing is 3 years and any amounts borrowed would bear interest at 6.5% and a default interest rate of 10%. The financing would be secured by all of the assets of Go Media and by the revenue stream of all current and future service contracts. During the first 18 months following the financing, the Company would be required to make interest payments only. During the next 12 months the Company would be required to make interest and principal payments and fully repay the financing prior to the third anniversary. The Company paid an origination fee of $12,500.

     
  (b)

Subsequent to December 31, 2011, the Company converted $4,500 of the convertible note payable described in Note 4(a) into 7,878,412 shares of the Company’s common stock.