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UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, D C. 20549
 FORM 10-Q
 þ
    
    QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934.
 For the quarterly period ended March 31, 2009
 or
 o
    
    TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (d) OF
THE SECURITIES EXCHANGE ACT OF 1934
 For the transition period from
 _____ 

to
 _____
 Commission file number 001-33746
 TM ENTERTAINMENT AND MEDIA, INC.
 
  Delaware
    
    20-8951489(State or other jurisdiction of
    
    (I.R.S. Employerincorporation or organization)
    
    Identification No.)
 307 East 87th Street, New York, NY
    
    10128(Address of principal executive offices)
    
    (Zip Code)Registrants
telephone number, including area code: (212) 289-6942
 (Former name, former address and former fiscal year, if changed since last report)
 þ o
 o o
  Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer þ
    
    Smaller reporting company o(Do not check if a smaller reporting company)
 þ o




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TABLE OF CONTENTS
 PART I FINANCIAL INFORMATION
    
    
    1ITEM 1. FINANCIAL STATEMENTS
    
    
    1ITEM 2. MANAGEMENTS DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS
    
    
    12ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
    
    
    20ITEM 4T. CONTROLS AND PROCEDURES
    
    
    20PART II OTHER INFORMATION
    
    
    21ITEM 1: LEGAL PROCEEDINGS
    
    
    21ITEM 1A: RISK FACTORS
    
    
    21ITEM 2: UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS
    
    
    21ITEM 3: DEFAULTS UPON SENIOR SECURITIES
    
    
    21ITEM 4: SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS
    
    
    21ITEM 5: OTHER INFORMATION
    
    
    21ITEM 6: EXHIBITS
    
    
    21Exhibit 2.1Exhibit 10.1Exhibit 10.2Exhibit 31.1Exhibit 31.2Exhibit 32.1




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PART I
 FINANCIAL INFORMATION
 
  TM ENTERTAINMENT AND MEDIA, INC.
(A CORPORATION IN THE DEVELOPMENT STAGE)
 Condensed Balance Sheets
 March 31, 2009
    
    
    December 31, 2008(unaudited)ASSETSCurrent assets:Cash
    
    $
    54,714
    
    
    $
    159,689Cash held in trust available for taxes
    
    
    8,500
    
    
    
    15,770Prepaid expenses
    
    
    56,144
    
    
    
    89,776Total current assets
    
    
    119,358
    
    
    
    265,235Cash held in trust   restricted
    
    
    81,145,922
    
    
    
    81,119,299Total assets
    
    $
    81,265,280
    
    
    $
    81,384,534LIABILITIES AND STOCKHOLDERS EQUITYCurrent liabilities:Accounts payable and accrued liabilities (including
related parties of $64,000 and $44,800 respectively)
    
    $
    603,415
    
    
    $
    414,563Total current liabilities
    
    
    603,415
    
    
    
    414,563Deferred underwriting fee
    
    
    3,281,600
    
    
    
    3,281,600Total liabilities
    
    
    3,885,015
    
    
    
    3,696,163Commitments and contingenciesCommon stock, subject to possible conversion of 3,075,475
shares
    
    
    24,285,542
    
    
    
    24,285,542Interest income attributable to common stock, subject to
possible
conversion (net of taxes of $2,250 and $4,731 respectively)
    
    
    50,120
    
    
    
    42,136Stockholders equity:Preferred stock  1,000,000 shares authorized, $.001 par
value, none issued and outstanding
    
    
    
    
    
    
    Common stock  40,000,000 authorized, $.001 par value,
12,505,000 issued and outstanding
(which includes 3,075,475 shares subject to possible
conversion)
    
    
    12,505
    
    
    
    12,505Additional paid-in capital
    
    
    53,575,335
    
    
    
    53,575,335(Deficit) accumulated during the development stage
    
    
    (543,237
    )
    
    
    (227,147
    )Total stockholders equity
    
    
    53,044,603
    
    
    
    53,360,693Total liabilities and stockholders equity
    
    $
    81,265,280
    
    
    $
    81,384,534
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TM ENTERTAINMENT AND MEDIA, INC.
(A CORPORATION IN THE DEVELOPMENT STAGE)
 Condensed Statements of Operations
(unaudited)
 For the PeriodFor the Three
    
    
    For the Three
    
    
    from May 1, 2007Months Ended
    
    
    Months Ended
    
    
    (inception) toMarch 31, 2009
    
    
    March 31, 2008
    
    
    March 31, 2009Formation and operating expenses
    
    $
    (408,391
    )
    
    $
    (853,050
    )
    
    $
    (2,697,773
    )Interest expense
    
    
    
    
    
    
    
    
    
    
    (2,664
    )Interest income
    
    
    100,285
    
    
    
    469,970
    
    
    
    2,207,320(Loss) before taxes
    
    
    (308,106
    )
    
    
    (383,080
    )
    
    
    (493,117
    )Income taxes
    
    
    
    
    
    
    
    
    
    
    Net (loss)
    
    
    (308,106
    )
    
    
    (383,080
    )
    
    
    (493,117
    )Less: interest income attributable
to common stock subject to possible
conversion
(net of taxes of $2,550, $0 and
$7,281 respectively)
    
    
    (7,984
    )
    
    
    
    
    
    
    (50,120
    )Net (loss) attributable to common
stock not subject to possible
conversion
    
    $
    (316,090
    )
    
    $
    (383,080
    )
    
    $
    (543,237
    )Net loss per share:Basic
    
    $
    (0.02
    )
    
    $
    (0.03
    )Diluted
    
    $
    (0.02
    )
    
    $
    (0.03
    )Weighted average shares outstanding:Basic
    
    
    12,505,000
    
    
    
    12,505,000Diluted
    
    
    12,505,000
    
    
    
    12,505,000Weighted average shares outstanding
subject to possible conversion
    
    
    3,075,475
    
    
    
    3,075,475Net (loss) per share attributable
to common stock not subject to
possible conversion:Basic
    
    $
    (0.03
    )
    
    $
    (0.04
    )Diluted
    
    $
    0.03
    )
    
    $
    (0.04
    )
   2




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TM ENTERTAINMENT AND MEDIA, INC.
(A CORPORATION IN THE DEVELOPMENT STAGE)
 Condensed Statement of Stockholders Equity
 For the Period from May 1, 2007 (inception) to March 31, 2009(Deficit)RetainedEarningsAccumulatedCommon
    
    
    Common
    
    
    Additional
    
    
    DuringStock
    
    
    Stock
    
    
    Paid-In
    
    
    Development
    
    
    StockholdersShares
    
    
    Amount
    
    
    Capital
    
    
    Stage
    
    
    EquityIssuance of common stock to initial
stockholders on May 1, 2007 at $.011
per share
    
    
    2,250,000
    
    
    $
    2,250
    
    
    $
    22,750
    
    
    
    
    
    
    $
    25,000Sale of Private Placement Warrants
    
    
    
    
    
    
    
    
    
    
    2,100,000
    
    
    
    
    
    
    
    2,100,000Sale of 10,255,000 units through
public offering
(net of underwriters discount and
offering expenses)
Including 3,075,475 shares subject
to possible conversion
    
    
    10,255,000
    
    
    
    10,255
    
    
    
    75,738,027
    
    
    
    
    
    
    
    75,748,282Proceeds from sale of underwriters
purchase option
    
    
    
    
    
    
    
    
    
    
    100
    
    
    
    
    
    
    
    100Proceeds subject to possible
conversion
    
    
    
    
    
    
    
    
    
    
    (24,285,542
    )
    
    
    
    
    
    
    (24,285,542
    )Net Income
    
    
    
    
    
    
    
    
    
    
    
    
    
    $
    190,096
    
    
    
    190,096Balance at December 31, 2007
    
    
    12,505,000
    
    
    
    12,505
    
    
    
    53,575,335
    
    
    
    190,096
    
    
    
    53,777,936Accretion of trust fund relating to
common stock subject to possible
conversion
( net of taxes of $4,731)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (42,136
    )
    
    
    (42,136
    )Net loss for the year ended December
31, 2008
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (375,107
    )
    
    
    (375,107
    )Balance at December 31, 2008
    
    
    12,505,000
    
    
    
    12,505
    
    
    
    53,575,335
    
    
    
    (227,147
    )
    
    
    53,360,693Accretion of trust fund relating to
common stock subject to possible
conversion
( net of taxes of $2,250)
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (7,984
    )
    
    
    (7,984
    )Net loss for the three months ended
March 31, 2009
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    (308,106
    )
    
    
    (308,106
    )Balance at March 31, 2009 (unaudited)
    
    
    12,505,000
    
    
    $
    12,505
    
    
    $
    53,575,335
    
    
    $
    (543,237
    )
    
    $
    53,044,603
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TM ENTERTAINMENT AND MEDIA, INC.
(A CORPORATION IN THE DEVELOPMENT STAGE)
 Condensed Statements of Cash Flows
 For the Three
    
    
    For the Period from May 1,For the Three Months
    
    
    Months Ended
    
    
    2007 (inception) to March 31,Ended March 31, 2009
    
    
    March 31, 2008
    
    
    2009Cash flows from operating activities:Net (loss)
    
    $
    (308,106
    )
    
    $
    (383,080
    )
    
    $
    (493,117
    )Decrease (increase) in prepaid
expenses
    
    
    33,632
    
    
    
    8,563
    
    
    
    (56,144
    )Increase in accounts payable and
accrued liabilities
    
    
    188,852
    
    
    
    410,736
    
    
    
    603,415Net cash (used) provided by
operating activities
    
    
    (85,622
    )
    
    
    36,219
    
    
    
    54,154Cash flows from investing activities:Cash placed in Trust
    
    
    (26,623
    )
    
    
    
    
    
    
    (81,145,922
    )Net cash used in investing activities
    
    
    (26,623
    )
    
    
    
    
    
    
    (81,145,922
    )Cash flows from financing activities:Proceeds from sale of shares of
common stock to Initial Stockholders
    
    
    
    
    
    
    
    
    
    
    25,000Proceeds from sale of units to public
    
    
    
    
    
    
    
    
    
    
    82,040,000Proceeds from private placement of
warrants
    
    
    
    
    
    
    
    
    
    
    2,100,000Proceeds from note payable to
Initial Stockholder
    
    
    
    
    
    
    
    
    
    
    100,000Repayment of note payable to Initial
Stockholder
    
    
    
    
    
    
    
    
    
    
    (100,000
    )Proceeds from sale of underwriters
purchase option
    
    
    
    
    
    
    
    
    
    
    100Payment of deferred offering costs
    
    
    
    
    
    
    
    
    
    
    (3,010,118
    )Net cash provided by (used in)
financing activities
    
    
    
    
    
    
    
    
    
    
    81,154,982Net (decrease) increase in cash
    
    
    (112,245
    )
    
    
    36,219
    
    
    
    63,214Cash at beginning of period
    
    
    175,459
    
    
    
    465,373
    
    
    
    Cash at end of period
    
    $
    63,214
    
    
    $
    501,592
    
    
    $
    63,214Supplemental disclosure of non cash
financing activitiesAccrual of deferred underwriting fee
    
    $
    
    
    
    $
    
    
    
    $
    3,261,600Accrual of deferred offering costs
    
    $
    
    
    
    $
    
    
    
    $
    
   4




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The Fair Value Option for Financial Assets and
Financial Liabilities
       
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March 31, 2009
    
    
    December 31, 2008(unaudited)Deferred tax benefit
    
    $
    1,200,000
    
    
    $
    1,020,000Less: valuation allowance
    
    
    (1,200,000
    )
    
    
    (1,020,000
    )Total
    
    $
    
    
    
    $
    
   10




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Acquisition
   Year
    
    Net Income (RMB)
    
    
    Net Income (US$)1
    
    
    Shares2009
    
    287.0 million
    
    $42.0 million
    
    1.0 million2010
    
    570.0 million
    
    $83.5 million
    
    7.0 million2011
    
    889.0 million
    
    $130.2 million
    
    7.0 million
 (1)
    
    Based on exchange rate of 6.83 RMB/USD.   Loan from Stockholder
    
    12




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Forward Looking Statements
  
    
    Ability to complete a combination with one or more target businesses;
 
    
    Success in retaining or recruiting, or changes required in, our management or
directors following a business combination;
 
    
    Potential inability to obtain additional financing to complete a business combination;
 
    
    Limited pool of prospective target businesses;
 
    
    Potential change in control if we acquire one of more target businesses for stock;
 
    
    Public securities limited liquidity and trading;
 
    
    The delisting of our securities from the American Stock Exchange or an
inability to have our securities listed on the American Stock Exchange following a
business combination;
 
    
    Use of proceeds not in trust or available to us from interest income on the
trust account of the Company (Trust Account) balance; or
 
    
    Financial performance.
   Overview
   13




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Year
    
    Net Income (RMB)
    
    
    Net Income (US$)1
    
    
    Shares2009
    
    287.0 million
    
    $42.0 million
    
    1.0 million2010
    
    570.0 million
    
    $83.5 million
    
    7.0 million2011
    
    889.0 million
    
    $130.2 million
    
    7.0 million
 (1)
    
    Based on exchange rate of 6.83 RMB/USD.    Liquidity and Capital Resources
      16




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Going Concern
   Results of Operations
    17




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Off-Balance Sheet Arrangements
  Contractual Obligations
  Recently Issued Accounting Pronouncements and Their Effect on the Companys Financial Statement.
    18




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Effectiveness of Disclosure Controls and Procedures
  Changes in Internal Control over Financial Reporting
    20




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PART II
 OTHER INFORMATION
 
   
   
   
   
   
   
   2.1
    
    
    Share Exchange Agreement, dated as of May 1, 2009, by and among TM
Entertainment and Media, Inc., Hong Kong Mandefu Holdings Ltd., Fujian zhong Heng
Express Information Technology Co., Ltd., Fujian Fenzhong Media Co., Ltd., Thousand
Space Holding Limited, Bright Elite Management Limited, Zheng Cheng, Qung Ping Lin,
and Ou Wen Lin.*10.1
    
    
    Promissory Note dated May 4, 2009, issued to Theodore S. Green in the
principal amount of $300,000.10.2
    
    
    Agreement dated May 4, 2009, between Theodore S. Green and Malcolm Bird.31.1
    
    
    Certification by Co-Chief Executive Officer and Interim Chief Financial
Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.31.2
    
    
    Certification by Co-Chief Executive Officer pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.32.1
    
    
    Certification by Co-Chief Executive Officers and Interim Chief Financial
Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.
 
 *
    
    Schedules and exhibits to the Share Exchange Agreement have been omitted pursuant to Item
601(b)(2) of Regulation S-K. The Company hereby undertakes to furnish supplementally a copy
of any omitted schedules and exhibits to the Securities and Exchange Commission upon
request.  21




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SIGNATURES
   TM ENTERTAINMENT AND MEDIA, INC.By:
    
    /s/ Theodore S. GreenName:
    
    Theodore S. GreenTitle:
    
    Chairman, Co-Chief Executive Officer andInterim Chief Financial Officer
  22




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EXHIBIT INDEX
 2.1
    
    
    Share Exchange Agreement, dated as of May 1, 2009, by and among TM
Entertainment and Media, Inc., Hong Kong Mandefu Holdings Ltd., Fujian zhong Heng
Express Information Technology Co., Ltd., Fujian Fenzhong Media Co., Ltd., Thousand
Space Holding Limited, Bright Elite Management Limited, Zheng Cheng, Qung Ping Lin,
and Ou Wen Lin.*10.1
    
    
    Promissory Note dated May 4, 2009, issued to Theodore S. Green in the
principal amount of $300,000.10.2
    
    
    Agreement dated May 4, 2009, between Theodore S. Green and Malcolm Bird.31.1
    
    
    Certification by Co-Chief Executive Officer and Interim Chief Financial
Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.31.2
    
    
    Certification by Co-Chief Executive Officer pursuant to Section 302 of the
Sarbanes-Oxley Act of 2002.32.1
    
    
    Certification by Co-Chief Executive Officers and Interim Chief Financial
Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the
Sarbanes-Oxley Act of 2002.
 
 *
    
    Schedules and exhibits to the Share Exchange Agreement have been omitted pursuant to Item
601(b)(2) of Regulation S-K. The Company hereby undertakes to furnish supplementally a copy
of any omitted schedules and exhibits to the Securities and Exchange Commission upon
request.  23