Document:

exv10w1

 

[Omnibus Form of Insider Letter Agreement]

Exhibit 10.1

                    
        , 2007

Santa Monica Media Corporation

9229 Sunset Boulevard, Suite 505

Los Angeles, California 90069

			
		 	                    Re: Initial Public Offering

Ladies and Gentlemen:

     This letter is being delivered to you in accordance with the Underwriting Agreement (the
“Underwriting Agreement”) entered into by and between Santa Monica Media Corporation, a Delaware
corporation (the “Company”), Citicorp Global Markets Inc. and
Ladenburg Thalmann & Co. Inc. (the “Underwriters”), relating to an underwritten initial public
offering (the “IPO”) of the Company’s units (the “Units”), each comprised of one share of the
Company’s common stock, par value $0.001 per share (the “Common Stock”), and one warrant, which is
exercisable for one share of Common Stock (a “Warrant”). Certain capitalized terms used herein are
defined in paragraph 12 hereof.

     In order to induce the Company to enter into the Underwriting Agreement and to proceed with
the IPO, and in recognition of the benefit that such IPO will confer upon the undersigned as a
stockholder of the Company, and for other good and
valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the
undersigned hereby agrees with the Company as follows:

     1. If the Company solicits approval of its stockholders of a Business Combination, the
undersigned will vote all shares of Common Stock, including Insider Shares, Private Placement
Shares and IPO Shares, owned directly or indirectly by him or it in accordance with the majority of
the votes cast by the holders of the IPO Shares, and hereby waives any and all rights to convert
his or its Insider Shares and Private Placement Shares in connection with a Business Combination.

     2. (i) [In the event that the Company fails to consummate a Business Combination within
(a) 18 months from the consummation of the IPO, unless a letter of intent, agreement in principle or
definitive agreement has been executed with respect to a Business Combination within such 18 month
period, (“18-Month Execution Failure”) or
(b) 24 months after the consummation of the IPO, if a
letter of intent, agreement in principle or definitive agreement has been executed with respect to
a Business Combination within 18 months from the consummation of
the IPO but the Business Combination has
not been consummated within such 18 month period (“24-Month Transaction Failure”), the undersigned
will (1) within a reasonable time prior to the expiration of such 18 or 24 month period, as the
case may be, vote to adopt a specific plan of dissolution and liquidation to be included in a proxy
statement to seek stockholder approval for such plan of dissolution and liquidation in the event
that the Company fails to so consummate a Business Combination within such 18- or 24-month period,
as the case may be, and (2) take all reasonable actions within the undersigned’s power to cause to
be prepared a proxy statement that sets forth such plan of dissolution and liquidation and

 

 

recommends that the Company’s stockholders approve such plan.]1 In the event of an
18-Month Execution Failure or 24-Month Transaction Failure, as the case may be, the undersigned
will take all reasonable actions within the undersigned’s power to (x) cause the proxy statement
setting forth the specific plan of dissolution and liquidation approved by the Company’s board of
directors to be filed with the Securities and Exchange Commission (the “SEC”) as promptly as
possible after the expiration of the 18- or 24-month period, as the case may be, and (y)
cause a meeting of the Company’s stockholders to consider such plan of dissolution and liquidation
to be held (1) within 30 days following the passing of the deadline for SEC review of the proxy
statement, in the event the SEC does not review the proxy statement, and (2) promptly following the
conclusion of the comment and review process, in the event the SEC reviews the proxy statement.
The undersigned will vote all shares of Common Stock, including Insider Shares, Private Placement
Shares and IPO Shares, owned directly or indirectly by him or it in favor of such plan of
dissolution and liquidation.

     (ii) [In the event that the Company seeks approval from its stockholders for a Business
Combination within the foregoing 24-month period, the
undersigned will (a) vote to adopt a specific plan of dissolution and liquidation to be included in
the proxy statement seeking such stockholder approval of the Business Combination in the event that
the Company’s stockholders fail to so approve such Business Combination (“Business
Combination Approval Failure”) and (b) take all reasonable actions within the undersigned’s power
to cause to be prepared a proxy statement that sets forth such Business Combination and plan of
dissolution and liquidation and recommends that the Company’s stockholders approve such plan in the
event of a Business Combination Approval Failure.]2 In the event that the
Company seeks approval from its stockholders for a Business Combination prior to the
expiration of the foregoing 24-month period, the undersigned will take all reasonable actions
within the undersigned’s power to (x) cause the proxy statement setting forth both the Business
Combination recommendation and the specific plan of dissolution and liquidation approved by the
Company’s board of directors to be filed with the SEC and (y) cause a meeting of the
Company’s stockholders to be held to consider such alternative recommendations.

     (iii) In the event the Company’s stockholders approve a plan of dissolution and liquidation in
connection with (a) an 18 Month Execution Failure or (b) a 24 Month Transaction Failure or (c) a Business Combination Approval Failure (the date of the first such failure to occur being the
“Transaction Failure Date”), the undersigned will take all reasonable actions within the
undersigned’s power to (x) cause the Trust Fund to be liquidated and, after paying or reserving for
payment the Company’s liabilities, distributed to the holders of the IPO Shares as soon as
practicable and (y) cause the Company to dissolve and liquidate as soon as practicable (the
earliest date on which the conditions in clauses (x) and (y) are both satisfied being the
“Liquidation Date”). [In the event that the assets held outside the Trust Fund are insufficient to
pay the costs and expenses associated with the dissolution and liquidation of the Company, the
undersigned will indemnify and hold the Company harmless, jointly and severally with the other
officers of the Company (with right of contribution against such other officers), against any such
additional costs or expenses incurred by the Company in connection with the dissolution and
liquidation, excluding any costs that may be incurred as a result of
litigation pertaining to the Company’s dissolution and liquidation.]3 The undersigned hereby waives any and
all right, title, interest or claim of any kind in or to any distributions of the Trust Fund as a
result of such distribution, or to any other amounts distributed in connection with a liquidating
distribution of the Company with respect to the undersigned’s Insider Shares and the undersigned’s
Private Placement Shares (“Claim”) and hereby waives any Claim the undersigned may have in the
future as a result of, or arising out of, any contracts or agreements with the Company and will not
seek recourse against the Trust Fund for any reason whatsoever. The undersigned hereby agrees that
the Company shall be entitled to reimbursement from the undersigned for any distribution of the
Trust Fund, or any other amounts distributed by the Company in connection with a liquidating
distribution, received by the undersigned in respect of the undersigned’s Insider Shares and
Private Placement Shares.

     3. [Subsequent to the Transaction Failure Date, the undersigned agrees to indemnify and hold
harmless the Company, jointly and severally with the other officers
of the Company (with right of contribution from such other officers), against any and
all loss, liability, claims, damage and expense whatsoever (including, but not limited to, any and
all legal or other expenses reasonably incurred in investigating preparing or defending against any
litigation, whether pending or threatened, or any claim whatsoever) to which the Company may become
subject, prior to, on or after the Transaction Failure Date, as a result of (i) any claim by any person who is owed money by the Company
for goods provided or services rendered, products sold or money loaned to the Company, or (ii) any claim by any acquisition target that the
Company did not pay or reimburse such target for the fees and expenses of third party providers of
services (such as accountants, consultants and attorneys) to the target that the Company agreed in
writing with the target to be liable for, in accordance with the terms of such agreement, but in
each case only to the extent (i) such vendor, lender or prospective acquisition target failed to execute a
valid and enforceable waiver of rights or claims to the Trust Fund, and (ii) necessary to ensure
that such loss, liability, claim, damage or expense does not reduce the amount in the Trust Fund
(or, in the event that such claim arises after the distribution of the Trust Fund, to the extent
necessary to ensure that the Company’s former stockholders, other than the officers of the Company, are not liable for any amount of
such loss, liability, claim, damage or
expense).]3

 

			
	1	 	This section of the agreement will appear
only in the agreements executed by the directors of the Company.
	 
	2	 	This section of the agreement will appear
only in the agreements executed by the directors of the Company.
	 
	3	 	This section of the agreement will appear
only in the agreements executed by the executive officers of the Company.

 

 

     4. The undersigned hereby waives any and all rights to exercise the Warrants included in its
Private Placement Shares unless a registration statement under the Securities Act of 1933, as
amended (the “Securities Act”), with respect to the shares of Common Stock underlying the Warrants
is effective and a current prospectus is on file with the SEC. The undersigned acknowledges and
agrees that the Warrants included in its Private Placement Shares must be exercised privately
pursuant to an exemption from the registration requirements of Section 5 of the Securities Act and
that such exercise is not eligible for
registration.4

     5. The undersigned acknowledges and agrees that the Company will not consummate any Business
Combination which involves a company which is affiliated with any of the Insiders or their
respective affiliates unless the Company obtains an opinion from an independent investment banking
firm that the Business Combination is fair to the Company’s stockholders from a financial point of
view.

     6. Neither
the undersigned, any member of the family of the undersigned, nor any affiliate of the undersigned will be entitled to receive
and will not accept any compensation, including payments to related parties of the existing
stockholders, for performing due diligence or for services rendered to the Company prior to or in
connection with the consummation of the Business Combination, provided that Santa Monica
Capital Corp. (“Related Party”) shall be allowed to charge the Company $7,500 per month to
compensate it for the Company’s use of Related Party’s offices, utilities and personnel as
described in the Registration Statement. The undersigned shall be entitled to reimbursement from
the Company for his or its reasonable out-of-pocket expenses incurred in connection with seeking and
consummating a Business Combination, to the extent that such expenses
do not exceed the amount of available assets held outside of the
trust account, unless a business combination is consummated.

     7. Neither the undersigned, any member of the family of the undersigned, nor any affiliate of
the undersigned will be entitled to receive, or accept, a finder’s fee or any other compensation
from the Company in the event the undersigned, any member of the family of the undersigned or any
affiliate of the undersigned originates a Business Combination.

     8. The undersigned shall not, and shall cause the members of
such the undersigned’s immediate family
and the affiliates of the undersigned to not, accept a finder’s
fee or any other compensation from any other person or entity in the
event the undersigned, any member of the undersigned’s immediate
family or any affiliate of the undersigned originates the initial Business Combination.

     9. The undersigned shall not (i) sell, offer to sell, contract or agree to sell, hypothecate,
pledge, grant any option to purchase or otherwise dispose of or agree to dispose of,

 

			
	4	 	This section of the agreement will appear only in the agreement
executed by Santa Monica Capital Partners, LLC.

 

 

directly or indirectly, or, except as provided in that certain Registration Rights Agreement
dated as of the date hereof pertaining to the Insider Shares and
Private Placement Shares of the undersigned, file (or participate in the
filing of) a registration statement with the SEC in respect of, or establish or increase a put
equivalent position or liquidate or decrease a call equivalent position within the meaning of
Section 16 of the Securities Exchange Act of 1934, as amended, and the rules and regulations of the
SEC promulgated thereunder with respect to, any Units and the shares of Common Stock and Warrants
comprising the Units, the shares of Common Stock issuable upon exercise of the Warrants or any
securities convertible into or exercisable or exchangeable for shares of Common Stock or such
Warrants or other rights to purchase shares of Common Stock or any such securities, (ii) enter into
any swap or other arrangement that transfers to another, in whole or in part, any of the economic
consequences of ownership of Units, shares of Common Stock or Warrants, the shares of Common Stock
issuable upon exercise of the Warrants or any securities convertible into or exercisable or
exchangeable for shares of Common Stock or such Warrants or other rights to purchase shares of
Common Stock or any such securities, whether any such transaction is to be settled by delivery of
shares of Common Stock or such other securities, in cash or otherwise, or (iii) publicly announce
an intention to effect any transaction specified in clause (i) or (ii) until (a) with respect to
his or its Insider Shares, the first anniversary of the Business Combination and (b) with respect
to its Private Placement Shares, after the consummation of a Business Combination (each, the “Lock-Up Period”).
Notwithstanding the foregoing, the undersigned may transfer his or its Insider Shares and his or
its Private Placement Shares during the applicable Lock-Up Period (i) by gift to a member of the
undersigned’s immediate family or to a trust, the beneficiary of which is a member of an
undersigned’s immediate family, an affiliate of the undersigned or to a charitable organization,
(ii) by virtue of the laws of descent and distribution upon death of the undersigned, (iii)
pursuant to a qualified domestic relations order, or (iv) in the event of a liquidation of the
Company prior to a Business Combination or the consummation of a liquidation, merger, stock
exchange or other similar transaction which results in all the Company’s stockholders having the
right to exchange their shares of Common Stock for cash, securities or other property subsequent to
the Company’s consummating a Business Combination with a target business; provided, however, that
the permissive transfers pursuant to clauses (i) — (iii) may be implemented only upon the
respective transferee’s written agreement to be bound by the terms and conditions of this
Agreement. During the applicable Lock-Up Period, the undersigned shall not grant a security
interest in his or its Insider Shares or Private Placement Shares.

     10. The undersigned agrees to be [President and Chief Executive
Officer, Treasurer and Director/Chairman of the Board of Directors/Member of the Advisory Board]
until the earlier of the consummation by the Company of a Business Combination or the Liquidation
Date.5 The undersigned’s biographical information furnished to the Company and the Underwriters and
attached hereto as Exhibit A is true and accurate in all respects, does not omit any material
information with respect to the undersigned’s background and contains all of the

 

			
	5	 	Not applicable to investors who are not
officers, directors, members of the Advisory Board or holders of more than 5%
of the equity of the Company.

 

 

information required to be disclosed pursuant to Section 401 of Regulation S-K, promulgated
under the Securities Act of 1933. The undersigned’s questionnaire furnished to the Company and the
Underwriters and attached hereto as Exhibit B is true and accurate in all respects. The
undersigned represents and warrants that:

          (a) the undersigned is not subject to or a respondent in any legal action for, any injunction,
cease-and-desist order or order or stipulation to desist or refrain from any act or practice
relating to the offering of securities in any jurisdiction;

          (b) the undersigned has never been convicted of or pleaded guilty to any crime (i) involving
any fraud or (ii) relating to any financial transaction or handling of funds of another person, or
(iii) pertaining to any dealings in any securities and the undersigned is not currently a defendant
in any such criminal proceeding; and

          (c) the undersigned has never been suspended or expelled from membership in any securities or
commodities exchange or association or had a securities or commodities license or registrations
denied, suspended or revoked.

     11. The undersigned has full right and power, without violating any agreement by which he or
it is bound (including, without limitation, any non-competition or non-solicitation agreement with
any employer or former employer), to enter into this letter agreement, [serve as [President and
Chief Executive Officer, Treasurer and as a member of the Board of Directors of the
Company/Chairman of the Board of Directors/Member of the Advisory Committee] and hereby consents to
being named in the registration statement as a[n] [officer] [director] [adviser] of the
Company.]6

     12. As used herein, (i) a “Business Combination” shall mean the initial acquisition of one or
more assets or operating businesses through a merger, capital stock exchange, asset or stock
acquisition or other similar business combination in the communications, media, gaming and/or
entertainment industries in connection with which the Company will require that a majority of the
shares of Common Stock voted by the public stockholders, as such term is used in the Registration
Statement, are voted in favor of the acquisition and less than 30% of the public stockholders both
exercise their conversion rights and vote against the proposed acquisition selected by the Company;
(ii) “Insiders” shall mean all officers, directors, advisers, beneficial owners and stockholders of
the Company immediately prior to the IPO; (iii) “Insider Shares” shall mean all of the shares of
Common Stock owned directly or indirectly by an Insider prior to
                    ,
2007 and any securities convertible into or exercisable or exchangeable for shares of
Common Stock or other rights to purchase shares of Common Stock or any such
securities; (iv) “IPO Shares” shall mean the shares of
Common Stock underlying the Units of the Company, and all shares of
Common Stock issuable upon exercise of such Warrants, issued in
the Company’s IPO; (v) “Private

 

			
	6	 	Not applicable to persons who are not
officers, directors, or members of the Advisory Board.

 

 

Placement Shares” shall mean the 375,000 shares of Common Stock and Warrants underlying the
375,000 Units that Santa Monica Capital Partners, LLC has agreed to purchase in a private placement immediately prior to
the IPO, all shares of Common Stock issuable upon exercise of such Warrants and any securities
convertible into or exercisable or exchangeable for shares of Common Stock or such Warrants or
other rights to purchase shares of Common Stock or any such securities; and (vi) “Trust Fund” shall
mean the Trust Account established under that certain Investment Management Trust Agreement, dated
as of the date hereof, by and among the Company and Continental Stock Transfer & Trust Company.

     The undersigned acknowledges and understands that the Company will rely upon the agreements,
representations and warranties set forth herein in proceeding with the IPO. Nothing contained
herein shall be deemed to render the Underwriters a representative of, or a fiduciary with respect
to, the Company, its stockholders, or any creditor or vendor of the Company with respect to the
subject matter hereof.

     This letter agreement shall be binding on the undersigned and such person’s respective
successors, heirs, personal representatives and assigns. This letter agreement shall terminate on
the earlier of (i) the consummation of a Business Combination and (ii) the Liquidation Date;
provided that such termination shall not relieve the undersigned from liability for any breach of
this agreement prior to its termination, [and provided further
that the second sentence of Section 2(iii) and Section 3 of this agreement
shall survive a termination pursuant to clause (ii).]

     This letter agreement shall be governed by and interpreted and construed in accordance with
the laws of the State of New York applicable to contracts formed and to be performed entirely
within the State of New York, without regard to the conflicts of law provisions thereof to the
extent such principles or rules would require or permit the application of the laws of another
jurisdiction.

     No term or provision of this letter agreement may be amended, changed, waived, altered or
modified except by written instrument executed and delivered by the party against whom such
amendment, change, waiver, alteration or modification is to be enforced.

 

[Name of current stockholder]

Accepted and agreed:

SANTA MONICA MEDIA CORPORATION

			
	By:	 	
	 
	 	
	Name:	 	
	Title:	 	

 

 

Exhibit A

[Biographical Information Furnished to the Company and the Underwriters]

 

 

Exhibit B

[Questionnaires Furnished to the Company and the Underwriters]exv10w2

 

Exhibit 10.2

INVESTMENT MANAGEMENT TRUST AGREEMENT

          This Investment Management Trust Agreement (this “Agreement”) is made as
of
                    ,
2007 by and between
Santa Monica Media Corporation, a Delaware corporation (the “Company”), and Continental Stock
Transfer & Trust Company (the “Trustee”).

          WHEREAS, the Company’s Registration Statement on Form S-1, File No. 333-128384 (as amended,
the “Registration Statement”), for its initial public offering of securities (the “IPO”) has been
declared effective as of the date hereof by the Securities and Exchange Commission (“Effective
Date”);

          WHEREAS,
Citigroup Global Markets Inc. is acting as the
representative (the “Representative”) of the underwriters
(the “Underwriters”) in the IPO;

          WHEREAS, the Company has completed a private placement of 375,000 units of its securities for
an aggregate purchase price of $3,000,000 (the “Private Placement”);

          WHEREAS,
pursuant to the Underwriting Agreement, a portion of the Property
equal to $3,500,000
(or the amount specified in a notice pursuant to paragraph 2(f) hereof) is attributable to deferred
underwriting commissions that will become payable by the Company to the Representatives upon the
consummation of a Business Combination (as defined in the Registration Statement) (the “Deferred
Discount”);

          WHEREAS, as described in the Company’s Registration Statement, and in accordance with the
Company’s Amended and Restated Certificate of Incorporation,
$97,550,000 of the net proceeds
(inclusive of the Deferred Discount) of the IPO and Private Placement
($111,950,000 if the
underwriters over-allotment option is exercised in full) will be delivered to the Trustee to be
deposited and held in a trust account for the benefit of the Company and the public holders of the
Company’s common stock, par value $0.001 per share issued in the IPO, as hereinafter provided (the
amount to be delivered to the Trustee will be referred to herein as the “Property;” the
stockholders for whose benefit the Trustee shall hold the Property will be referred to as the
“Public Stockholders,” and the Public Stockholders and the Company will be referred to together as
the “Beneficiaries”); and

          WHEREAS, the Company and the Trustee desire to enter into this Agreement to set forth the
terms and conditions pursuant to which the Trustee shall hold the Property.

          IT IS AGREED:

          1. Agreements and Covenants of Trustee. The Trustee hereby agrees and covenants to:

          (a) Hold the Property in trust for the Beneficiaries in accordance with the terms of this
Agreement, in a segregated trust account (the “Trust Account”) established and maintained by the
Trustee at a branch of JPMorgan Chase NY Bank selected by the Trustee;

 

 

          (b) Manage, supervise and administer the Trust Account subject to the terms and conditions set
forth herein;

          (c) In a timely manner, upon the written instruction of the Company, invest and reinvest the
Property in United States “government securities,” within the meaning of Section 2(a)(16) of the
Investment Company Act of 1940 having maturity of 180 days or less, selected by the Company and
purchase and maintain the securities in a brokerage account established at the Royal Bank of
Canada;

          (d) Collect and receive, when due, all principal and income arising from the Property, which
shall become part of the “Property,” as such term is used herein;

          (e) Notify the Company and the Representative of all communications received by it with
respect to the Property requiring action by the Company;

          (f) Supply any necessary information or documents as may be requested by the Company in
connection with the Company’s preparation of the tax returns, for itself or the Trust Account;

          (g) Participate in any plan or proceeding for protecting or enforcing any right or interest
arising from the Property if, as and when instructed by the Company to do so;

          (h) Render to the Company, to the Representative and to such other person as the Company may
instruct in writing, monthly statements of the activities of and amounts in the Trust Account
reflecting all receipts and disbursements of the Trust Account;

          (i) If there is any income tax obligation relating to the income of the Property in the Trust
Account as determined by the Company, then, from time to time, at the written instruction of the
Company, the Trustee shall promptly to the extent there is not sufficient cash in the Trust
Account to pay such tax obligation, liquidate such assets held in the Trust Account as shall be
designated by the Company in writing, and disburse to the Company by wire transfer, out of the
Property in the Trust Account, the amount indicated by the Company as owing in respect of such
income tax obligation;

          (j) Upon written request from the Company, the Trustee shall distribute from the Trust Account
to the Company such amount as may be requested by the Company; provided, however, that the amount
distributed by the Trustee to the Company pursuant to this Section 1(j) at any one time shall not
exceed the lesser of (i) $1,600,000 and (ii) 60% of the aggregate amount of interest income earned
and received on the Property as of the date of such written request; provided further, however, in
no event shall the aggregate amount distributable to the Company pursuant to this Section 1(j)
exceed $1,600,000;

          (k) Commence liquidation of the Trust Account promptly after receipt of and only in accordance
with the terms of a letter (“Termination Letter”), in a form substantially similar to that attached
hereto as either Exhibit A or Exhibit B, signed on behalf of the Company by its Chief Executive
Officer and Secretary and affirmed by its entire Board of Directors, and complete the liquidation
of the Trust Account and disburse the Property in the Trust Account

2

 

(which disbursement shall include, in the event of a Business Combination, payment of the
Deferred Discount to the Representative) only as directed in the Termination Letter and the other
documents referred to therein; and

          (l) Permit or effect no distribution from the Trust Account except in accordance with
paragraphs 1(i), 1(j), 1(k) and 4(a).

          2. Agreements and Covenants of the Company. The Company hereby agrees and covenants
to:

          (a) Give all instructions to the Trustee hereunder in writing, signed by the Company’s Chief
Executive Officer, President or Chief Financial Officer. In addition, except with respect to its
duties under paragraphs 1(j) and (k) above, the Trustee shall be entitled to rely on, and shall be
protected in relying on, any verbal or telephonic advice or instruction which it in good faith
believes to be given by any one of the persons authorized above to give written instructions,
provided that the Company shall promptly confirm such instructions in writing;

          (b) Hold the Trustee harmless and indemnify the Trustee from and against, any and all
expenses, including reasonable counsel fees and disbursements, or loss suffered by the Trustee in
connection with any action, suit or other proceeding brought against the Trustee involving any
claim, or in connection with any claim or demand which in any way arises out of or relates to this
Agreement, the services of the Trustee hereunder, or the Property or any income earned from
investment of the Property, except for expenses and losses resulting from the Trustee’s gross
negligence or willful misconduct. Promptly after the receipt by the Trustee of notice of demand or
claim or the commencement of any action, suit or proceeding, pursuant to which the Trustee intends
to seek indemnification under this paragraph, it shall notify the Company in writing of such claim
(hereinafter referred to as the “Indemnified Claim”). The Trustee shall have the right to conduct
and manage the defense against such Indemnified Claim, provided, that the Trustee shall obtain the
consent of the Company with respect to the selection of counsel, which consent shall not be
unreasonably withheld. The Company may participate in such action with its own counsel;

          (c) Pay the Trustee an initial acceptance fee, an annual fee, and a transaction processing fee
for each disbursement made pursuant to Sections 1(i) and 1(j) as set forth on Schedule A hereto,
which fees shall be subject to modification by the parties from time to time. It is expressly
understood that the Property shall not be used to pay such fees and further agreed that said
transaction processing fees shall be deducted by the Trustee for the disbursements made to the
Company pursuant to Section 1(i). The Company shall pay the Trustee the initial acceptance fee and
the first year’s fees at the consummation of the IPO and thereafter on the anniversary of the
Effective Date. The Trustee shall refund to the Company the annual fee (on a pro rata basis) with
respect to any period after the liquidation of the Trust Account. The Company shall not be
responsible for any other fees or charges of the Trustee except as set forth in this Section 2(c)
and as may be provided in Section 2(b) hereof (it being expressly understood that the Property
shall not be used to make any payments to the Trustee under such Sections);

          (d) Provide to the Trustee any letter of intent, agreement in principle or definitive
agreement that is executed prior to
[                    , 2009] in connection with a Business

3

 

Combination, together with a certified copy of a unanimous resolution of the Board of
Directors of the Company affirming that such letter of intent, agreement in principle or definitive
agreement is in effect;

          (e) In connection with any vote of the Company’s stockholders regarding a Business
Combination, provide to the Trustee an affidavit or certificate of a firm regularly engaged in the
business of soliciting proxies and tabulating stockholder votes (which firm may be the Trustee)
verifying the vote of the Company’s stockholders regarding such Business Combination; and

          (f) Within five
business days after the Underwriters’ over-allotment option (or any
unexercised portion thereof) expires or is exercised in full, provide the Trustee written notice
(with a copy to the Representatives) of the total amount of the Deferred Discount, which shall in
no event be less than $3,500,000.

          3. Limitations of Liability. The Trustee shall have no responsibility or liability
to:

          (a) Take any action with respect to the Property, other than as directed in paragraph 1 hereof
and the Trustee shall have no liability to any party except for liability arising out of its own
gross negligence or willful misconduct;

          (b) Institute any proceeding for the collection of any principal and income arising from, or
institute, appear in or defend any proceeding of any kind with respect to, any of the Property
unless and until it shall have received instructions from the Company given as provided herein to
do so and the Company shall have advanced or guaranteed to it funds sufficient to pay any expenses
incident thereto;

          (c) Change the investment of any Property, other than in compliance with paragraph 1(c);

          (d) Refund any depreciation in principal of any Property;

          (e) Assume that the authority of any person designated by the Company to give instructions
hereunder shall not be continuing unless provided otherwise in such designation, or unless the
Company shall have delivered a written revocation of such authority to the Trustee;

          (f) The other parties hereto or to anyone else for any action taken or omitted by it, or any
action suffered by it to be taken or omitted, in good faith and in the exercise of its own best
judgment, except for its gross negligence or willful misconduct. The Trustee may rely conclusively
and shall be protected in acting upon any order, judgment, instruction, notice, demand,
certificate, opinion or advice of counsel (including counsel chosen by the Trustee), statement,
instrument, report or other paper or document (not only as to its due execution and the validity
and effectiveness of its provisions, but also as to the truth and acceptability of any information
therein contained) which is believed by the Trustee, in good faith, to be genuine and to be signed
or presented by the proper person or persons. The Trustee shall not be bound by any

4

 

notice or demand, or any waiver, modification, termination or rescission of this agreement or
any of the terms hereof, unless evidenced by a written instrument delivered to the Trustee signed
by the proper party or parties and, if the duties or rights of the Trustee are affected, unless it
shall give its prior written consent thereto;

          (g) Verify the correctness of the information set forth in the Registration Statement or to
confirm or assure that any acquisition made by the Company or any other action taken by it is as
contemplated by the Registration Statement;

          (h) File information returns with the United States Internal Revenue Service and payee
statements with the Company, documenting the taxes payable by the Company, if any, relating to
interest earned on the Property;

          (i) Pay any taxes on behalf of the Trust Account except as set forth in paragraph 1(i); and

          (j) Verify calculations, qualify or otherwise approve Company requests for distributions
pursuant to Section 1(i) or 1(j) above.

          4. Termination. This Agreement shall terminate as follows:

          (a) If the Trustee gives written notice to the Company that it desires to resign under this
Agreement, the Company shall use its reasonable efforts to locate a successor trustee. At such time
that the Company notifies the Trustee that a successor trustee has been appointed by the Company
and has agreed to become subject to the terms of this Agreement, the Trustee shall transfer the
management of the Trust Account to the successor trustee, including but not limited to the transfer
of copies of the reports and statements relating to the Trust Account, whereupon this Agreement
shall terminate; provided, however, that, in the event that the Company does not locate a successor
trustee within ninety days of receipt of the resignation notice from the Trustee, the Trustee may
submit an application to have the Property deposited with the United States District Court for the
Southern District of New York and upon such deposit, the Trustee shall be immune from any liability
whatsoever;

          (b) At such time that the Trustee has completed the liquidation of the Trust Account in
accordance with the provisions of paragraph 1(k) hereof, and disbursed the Property in accordance
with the provisions of the Termination Letter, this Agreement shall terminate except with respect
to Paragraph 2(b).

          5. Miscellaneous.

          (a) The Company and the Trustee each acknowledge that the Trustee will follow the security
procedures set forth below with respect to funds transferred from the Trust Account. Upon receipt
of written instructions, the Trustee will confirm such instructions with an Authorized Individual
at an Authorized Telephone Number listed on the attached Exhibit C. The Company and the Trustee
will each restrict access to confidential information relating to such security procedures to
authorized persons. Each party must notify the other party immediately if it has reason to believe
unauthorized persons may have obtained access to such information, or

5

 

of any change in its authorized personnel. In executing funds transfers, the Trustee will rely
upon account numbers or other identifying numbers of a beneficiary, beneficiary’s bank or
intermediary bank, rather than names. The Trustee shall not be liable for any loss, liability or
expense resulting from any error in an account number or other identifying number, provided it has
accurately transmitted the numbers provided.

          (b) This Agreement shall be governed by and construed and enforced in accordance with the laws
of the State of New York, without giving effect to conflict of laws. It may be executed in several
counterparts, each one of which shall constitute an original, and together shall constitute one
instrument.

          (c) This Agreement contains the entire agreement and understanding of the parties hereto with
respect to the subject matter hereof.

          (d) This Agreement or any provision hereof may only be amended or modified by a writing signed
by each of the parties hereto, provided, however, that no such amendment or modification (other
than to correct a typographical or similar technical error) may be made to paragraphs 1(i), 1(j),
1(k), 1(l), 2(d) and 2(e) and Exhibits A and B hereof without the consent of the Public
Stockholders, it being the specific intention of the parties hereto that each Public Stockholder is
and shall be a third-party beneficiary of this paragraph 6(d) with the same right and power to
enforce this paragraph 6(d) as either of the parties hereto. For purposes of this paragraph 6(d),
the “consent of the Public Stockholders” shall mean receipt by the Trustee of a certificate from an
entity certifying that (i) such entity regularly engages in the business of serving as inspector of
elections for companies whose securities are publicly traded, and (ii) either (a) 70% of the Public
Stockholders of record as of a record date established in accordance with Section 213(a) of the
Delaware General Corporation Law, as amended (the “DGCL”), have voted in favor of such
amendment or modification or (b) 70% of the Public Stockholders of record as of a record date
established in accordance with Section 213(b) of the DGCL has delivered to such entity a signed
writing approving such amendment or modification.

          (e) The parties hereto consent to the jurisdiction and venue of any state or federal court
located in the City of New York for purposes of resolving any disputes hereunder. As to any claim,
cross-claim or counterclaim in any way relating to this Agreement, each party waives the right to
trial by jury.

          (f) Any notice, consent or request to be given in connection with any of the terms or
provisions of this Agreement shall be in writing and shall be sent by express mail or similar
private courier service, by certified mail (return receipt requested), by hand delivery or by
facsimile transmission:

          if to the Trustee, to:

Continental Stock Transfer

& Trust Company

17 Battery Place

New York, New York 10004

Attn: Steven G. Nelson

6

 

Fax No.: (212) 509-5150

          if to the Company, to:

Santa Monica Media Corporation

9229 Sunset Boulevard, Suite 505

Los Angeles, California 90069

Attn: David Marshall

Tel. No.: (310) 256-3680

          in either case with a copy to:

Citigroup Global Markets Inc.

388 Greenwich Street

New York, New York 10013

Fax No.: (212) 816-7912

Attn: General Counsel

and

Bingham McCutchen LLP

399 Park Avenue

New York, New York 10022

Attn: Ann Chamberlain, Esq.

Fax No.: (212) 752-5378

and

Troy & Gould Professional Corporation

1801 Century Park East, 16th Floor

Los Angeles, California 90067

Attn: David L. Ficksman, Esq.

Fax No.: (310) 789-1490

          (g) This Agreement may not be assigned by the Trustee without the prior consent of the
Company.

          (h) Each of the Trustee and the Company hereby represents that it has the full right and power
and has been duly authorized to enter into this Agreement and to perform its

7

 

respective obligations as contemplated hereunder. The Trustee acknowledges and agrees that it
shall not make any claims or proceed against the Trust Account, including by way of set-off, and
shall not be entitled to any funds in the Trust Account under any circumstance.

          (i) The Trustee hereby waives any and all right, title, interest or claim of any kind
(“Claim”) in or to any distribution of the Trust Account, and hereby agrees not to seek recourse,
reimbursement, payment or satisfaction for any Claim against the Trust Account for any reason
whatsoever.

          (j) The Trustee hereby consents to the inclusion of Continental Stock Transfer & Trust Company
in the Registration Statement and other materials relating to the IPO.

[Signature page follows]

8

 

          IN WITNESS WHEREOF, the parties have duly executed this Investment Management Trust Agreement
as of the date first written above.

	 	 	 	 	 
	 	CONTINENTAL STOCK TRANSFER &

TRUST COMPANY, as Trustee

 	 
	 	By:  	 	 
	 	 	Name:  	 	 
	 	 	Title:  	 	 
	 
	 	SANTA MONICA MEDIA CORPORATION

 	 
	 	By:  	 	 
	 	 	Name:  	David Marshall 	 
	 	 	Title:  	Chairman and Chief Executive Officer 	 
	 

9

 

Exhibit 10.2

Schedule A

SCHEDULE A

Schedule of fees pursuant to Section 2(c) of the Investment Management Trust Agreement

between Santa Monica Media Corporation and

Continental Stock Transfer & Trust Company

	 	 	 	 	 	 	 
	Fee Item	 	Time and method of 
payment	 	Amount
	Initial acceptance fee

	 	Initial closing of IPO by
wire transfer
	 	$1,000	 
	 
	 	 	 	 	 	 
	Annual fee

	 	First year, initial closing
of IPO by wire transfer;
thereafter on the anniversary
of the effective date of the
IPO by wire transfer or check
	 	$3,000	 
	 
	 	 	 	 	 	 
	Transaction processing fee for
disbursements to Company under
Sections 1(i) and 1(j)

	 	Deduction by Trustee from
disbursement made to Company
under Section 1(i)
	 	$   250	 

	 	 	 	 	 	 	 
	 	 	Agreed:	 	 
	 
	 	 	 	 	 	 
	Dated
                    , 2007	 	Santa Monica Media Corporation	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Authorized Officer	 	 
	 
	 	 	 	 	 	 
	 	 	Continental Stock Transfer & Trust Company	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Authorized Officer	 	 

 

 

Exhibit 10.2

EXHIBIT A

[Letterhead of Company]

[Insert date]

Continental Stock Transfer
  &
Trust Company

17 Battery Place

New York, New York 10004

Attn: Steven Nelson

          Re: Trust Account No. —— Termination Letter

Gentlemen:

          Pursuant to paragraph 1(k) of the Investment Management Trust Agreement between Santa Monica
Media Corporation (the “Company”) and Continental Stock Transfer & Trust Company (the “Trustee”),
dated as of                                          (the “Trust Agreement”), this is to advise you that the Company has
entered into an agreement with                                          (the “Target Business”) to consummate a business
combination with the Target Business (the “Business Combination”) on or about [insert date]. The
Company shall notify you at least two business days in advance of the actual date of the
consummation of the Business Combination (the “Consummation Date”).

          Pursuant to paragraph 2(e) of the Trust Agreement, we are providing you with [an affidavit][a
certificate] of                     , which verifies the vote of the Company’s stockholders in connection
with the Business Combination. In accordance with the terms of the Trust Agreement, we hereby
authorize you to commence liquidation of the Trust Account to the effect that, on the Consummation
Date, all of funds held in the Trust Account will be immediately available for transfer to the
account or accounts that the Company shall direct on the Consummation Date.

          On the Consummation Date (i) counsel for the Company shall deliver to you written notification
that the Business Combination has been consummated, and (ii) the Company shall deliver to you
written instructions with respect to the transfer of the funds held in the Trust Account (the
“Instruction Letter”). You are hereby directed and authorized to transfer the funds held in the
Trust Account immediately upon your receipt of counsel’s letter and the Instruction Letter, (a) as
directed in writing by the Representative, in an amount equal to the Deferred Discount; (b) to
Public Stockholders who exercised their conversion option in connection with the Business
Combination, in an amount equal to their pro rata share of the amounts in the Trust Account as of
two business days prior to the Consummation Date (including the Deferred Discount and any income
actually received on amounts in the Trust Account but less an amount

 

 

equal to estimated taxes that are or will be due on such income at an assumed rate of [___]%
and less the amount of Net Income released to the Company pursuant to paragraph 1(j) of the Trust
Agreement); and (c) the remainder in accordance with the terms of the Instruction Letter. In the
event that certain deposits held in the Trust Account may not be liquidated by the Consummation
Date without penalty, you will notify the Company of the same and the Company shall direct you as
to whether such funds should remain in the Trust Account and be disbursed after the Consummation
Date to the Company or be liquidated and distributed promptly. Upon the disbursement of all the
funds in the Trust Account pursuant to the terms hereof, the Trust Agreement shall be terminated
and the Trust Account closed.

          In the event that the Business Combination is not consummated on the Consummation Date
described in the notice thereof and we have not notified you on or before the original Consummation
Date of a new Consummation Date, then the funds held in the Trust Account shall be reinvested as
provided in the Trust Agreement on the business day immediately following the Consummation Date as
set forth in the notice, subject to subsequent instructions from the Company with respect to the
disposition of the Trust Account, and the funds contained therein, in accordance with the Trust
Agreement.

          Capitalized terms used but not defined herein shall have the meanings ascribed to them in the
Trust Agreement.

	 	 	 	 	 	 	 
	 	 	Very truly yours,	 	 
	 
	 	 	 	 	 	 
	 	 	SANTA MONICA MEDIA CORPORATION	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	David Marshall	 	 
	 

	 	 	 	Chairman and Chief Executive Officer	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	AFFIRMED	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Kurt Brendlinger, Chief Financial Officer
and
   Director	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Eric Pulier, Chief Technology Officer,
Secretary 
   and Director	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Scott Sassa, Director	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Dallas Clement, Director	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 

2

 

	 	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Robert Schultz, Director	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Sharyar Baradaran, Director	 	 

3

 

Exhibit 10.2

EXHIBIT B

[Letterhead of Company]

[Insert date]

Continental
Stock Transfer
      &
Trust Company

17 Battery Place

New York, New York 10004

Attn: Steven Nelson

          Re: Trust Account No. —— Termination Letter

Gentlemen:

          Pursuant to paragraph 1(k) of the Investment Management Trust Agreement between Santa Monica
Media Corporation (the “Company”) and Continental Stock Transfer & Trust Company (the “Trustee”),
dated as of                                          (the “Trust Agreement”), this is to advise you that the Board of
Directors of the Company has voted to dissolve the Company and the Company’s stockholders have
approved such dissolution. Attached hereto is a copy of the Company’s Certificate of Dissolution,
as field with the Secretary of State of the State of Delaware, certified by the Secretary of the
Company as true and correct. Capitalized terms used but not otherwise defined herein shall have the
meanings ascribed to such terms in the Trust Agreement.

          In accordance with the terms of the Trust Agreement, we hereby authorize you to commence
liquidation of the Trust Account (including the Deferred Discount and any income actually received
on amounts in the Trust Account). In connection with this liquidation, you are hereby authorized to
establish a record date for the purposes of determining the stockholders of record entitled to
receive their per share portion of the Trust Account. The record date shall be within ten (10) days
of the liquidation date, or as soon thereafter as is practicable. You will notify the Company in
writing as to when all of the funds in the Trust Account will be available for immediate transfer
(the “Transfer Date”) in accordance with the terms of the Trust Agreement and the Amended and
Restated Certificate of Incorporation of the Company. You shall commence and oversee the
disbursement of such funds in accordance with the terms of the Trust Agreement and the Amended and
Restated Certificate of Incorporation of the Company; provided that an amount equal to 40% of any
income earned on the Property shall remain in the Trust Account for the purpose of paying any
income tax obligation related thereto. When all income tax obligations related to the income of the
Property have been satisfied, you shall disburse the remaining funds, if any, in accordance with
the terms of the Trust Agreement and the Amended and Restated Certificate of Incorporation. Upon
payment of all the funds in the Trust Account, the Trust Agreement shall be terminated.

 

 

	 	 	 	 	 	 	 
	 	 	Very truly yours,	 	 
	 
	 	 	 	 	 	 
	 	 	SANTA MONICA MEDIA CORPORATION	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	David Marshall	 	 
	 

	 	 	 	Chairman and Chief Executive Officer	 	 
	 
	 	 	 	 	 	 
	 	 	AFFIRMED	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Kurt Brendlinger, Chief Financial Officer
and    Director	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Eric Pulier, Chief Technology Officer,
Secretary    and Director	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Scott Sassa, Director	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Dallas Clement, Director	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Robert Schultz, Director	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Sharyar Baradaran, Director	 	 

2

 

Exhibit 10.2

EXHIBIT C

	 	 	 
	AUTHORIZED INDIVIDUAL(S)	 	AUTHORIZED
	FOR TELEPHONE CALL BACK	 	TELEPHONE NUMBER(S)
	Company:
	 	 
	 
	 	 
	Santa Monica Media Corporation
	 	 
	9229 Sunset Boulevard, Suite 505
	 	 
	Los Angeles, California 90069
	 	 
	Attn: David Marshall

	 	(310) 256-3680
	 
	 	 
	Trustee:
	 	 
	 
	 	 
	Continental Stock Transfer & Trust Company
	 	 
	17 Battery Place
	 	 
	New York, New York 10004
	 	 
	Attn: Steven G. Nelson, Chairman

	 	(212) 845-3200

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