On October 15, 2009, pursuant to the terms of a Share Exchange Agreement, dated as of May 1, 2009, as amended on September 30, 2009 ("Share Exchange Agreement"), TM Entertainment and Media, Inc. ("TM") acquired all of the issued and outstanding capital stock of Hong Kong Mandefu Holding Limited ("CME") and as a result, CME became a direct wholly-owned subsidiary of TM (the "Transaction").

CME, through contractual arrangements with Fujian Fenzhong, an entity majority owned by CME'S former majority shareholder, operates the largest television advertising network on inter-city express buses in China. While CME has no direct equity ownership in Fujian Fenzhong, through the contractual agreements CME receives the economic benefits of Fujian Fenzhong's operations.

Pursuant to the Share Exchange Agreement, TM purchased 100% of the outstanding equity of CME and issued 20.915 million newly issued shares of common stock and paid $10.0 million in three year, no interest promissory notes. In addition, the former shareholders of CME may earn up to an additional 15.0 million shares of common stock subject to the achievement of the following net income targets for 2009, 2010 and 2011:

Year       Net Income (RMB)     Net Income (US$)(1)         Shares

2009         287.0 million        $42.0 million           1.0 million
2010         570.0 million        $83.5 million           7.0 million
2011(2)      889.0 million        $130.2 million          7.0 million

(1) Based on current exchange rate of 6.83 RMB/US$.

(2) If CME's adjusted net income for 2009, 2010 or 2011 does not equal or exceed the targeted net income threshold for such fiscal year, the earn-out shares in respect of such fiscal year will not be issued; provided, however, that if CME's adjusted net income in the fiscal year immediately succeeding such non-achieving fiscal year exceeds the sum of
(i) the targeted net income threshold for such immediately succeeding fiscal year (which, for the fiscal year ending December 31, 2012, the targeted net income threshold shall be RMB1,155,700,000 ($169.2 million)) and (ii) the shortfall amount for the non-achieving fiscal year, then the earn-out shares in respect of such non-achieving fiscal year will be issued.

In connection with the approval of the Transaction at the October 15, 2009 Special Meeting of Stockholders of TM, the stockholders of TM also approved (i) an amendment to TM's Amended and Restated Certificate of Incorporation to remove the prohibition on the consummation of a Business Combination (as defined therein) if holders of an aggregate of 30% or more in interest of the shares of TM's common stock issued in its initial public offering ("IPO Shares") exercise their conversion rights, (ii) to amend TM's Amended and Restated Certificate of Incorporation to remove the requirement that only holders of the IPO Shares who vote against the Transaction (as defined below) may convert their IPO Shares . . .

Reference is made to the disclosure set forth under Item 2.01 of this Current Report on Form 8-K, which disclosure is incorporated herein by reference, concerning "Financial Information."

Reference is made to the disclosure described in the TM Definitive Proxy in the section entitled "The Transaction Proposal" beginning on Page 67, which is incorporated herein by reference.

Reference is made to the disclosure set forth under Item 2.01 of this Current Report on Form 8-K, which disclosure is incorporated herein by reference, concerning "Recent Sales of Unregistered Securities."

In connection with the closing of the Transaction, Eisner LLP ("Eisner") was replaced as TM's independent registered public accounting firm. The reports of Eisner on TM's financial statements for the year ended December 31, 2008 and the period ended December 31, 2007 contained no adverse opinion or a disclaimer of opinion and were not qualified or modified as to uncertainty, audit scope or accounting principles, except with respect to the TM's ability to continue as a going concern as described therein. During TM's period ended December 31, 2007, the year ended December 31, 2008 and through June 30, 2009, there were no disagreements with Eisner on any matter of accounting principles or practices, financial statement disclosure, or auditing scope or procedure, which disagreements, if not resolved to the satisfaction of Eisner would have caused it to make reference to the subject matter of such disagreements in its report on TM's financial statements for such periods. Also, there were no reportable events described under Item 304(a)(1)(iv) of Regulation S-K for the period from May 1, 2007 through December 31, 2008 or through the date of this report. CME has requested that Eisner furnish a letter addressed to the Securities and Exchange Commission stating whether it agrees with the statements made by it herein, and such letter is included in this Current Report on Form 8-K. The replacement was not specifically considered by the Board of Directors of TM.

AJ Robbins PC ("AJR") is being retained as the new independent registered public accounting firm. During the period from January 1, 2007 through December 31, 2008, and through the date of this Current Report on Form 8-K, TM did not consult with AJR regarding any of the matters or events set forth in Item 304(a)(2)(i) and (ii) of Regulation S-K although CME did consult with AJR during that time regarding such matters.

Reference is made to the disclosure described in the TM Definitive Proxy in the section entitled "Description of TM Common Stock and Other TM Securities," beginning on page 188, which disclosure is incorporated herein by reference, as well as the additional disclosures set forth in this report.

Reference is made to the disclosure set forth under Item 2.01 of this Current Report on Form 8-K, which disclosure is incorporated herein by reference, concerning "Directors and Executive Officers" and "Executive Compensation."

The material terms of the transaction by which TM acquired CME as its wholly-owned subsidiary are described in the TM Definitive Proxy in the section entitled "The Transaction Proposal," beginning on page 67 and is incorporated herein by reference.

The financial information of CME is included in the TM Definitive Proxy, in the sections entitled "Selected Consolidated Financial and Operating Data of CME," beginning on page 133, "CME Management's Discussion and Analysis of Financial Condition and Results of Operations of CME," beginning on page 135 and under the heading "Index to Financial Statements - Hong Kong Mandefu Holding Limited" beginning on page F-28, each of which are incorporated herein by reference. In addition, the pro forma effects of the Transaction are reflected in the "Unaudited Pro Forma Condensed Combined Financial Information" beginning on page 158, which is incorporated herein by reference, subject to the number of actual share conversions effected being approximately 94%, resulting in 9,602,587 shares purchased in TM's initial public offering being converted into approximately $76 million held in TM's trust account.

Exhibit No. Description

16.1 Letter of Eisner LLP dated October 21, 2009.