Exhibit 10.2

 

AMENDMENT NO. 2 TO LOAN AND SECURITY AGREEMENT

 

This Amendment No. 2 to Loan and Security Agreement (this “Amendment”) is
entered into and made effective as of August 27, 2018, by and between Llama
Productions LLC, a California limited liability company (the “Borrower”), and
Bank Leumi USA, a New York banking corporation (the “Lender”).

 

RECITALS

 

This Amendment is being entered into in reference to the following facts:

 

(A)       The Borrower and the Lender entered into a Loan and Security Agreement
(the “Agreement”), dated as of August 5, 2016 and amended as of November 7,
2017, in connection with original premium pay animated children’s episodic
television series tentatively entitled Llama Llama.

 

(B)       The parties hereto desire to amend the Agreement.

 

NOW, THEREFORE, in consideration of the mutual covenants contained herein the
parties hereto hereby agree as follows.

 

 

ARTICLE 1 - AMENDMENTS

 

1.1 Recitals. The first Recital of the Agreement is hereby amended and restated
to read in its entirety as follows:

 

“The Borrower has requested that the Lender make a loan to the Borrower of up to
$1,768,010.29, the proceeds of which shall be used to pay a portion of the
expenses of producing, completing and delivering fifteen (15) episodes of a
premium pay animated children’s television series tentatively entitled Llama
Llama and to pay interest, fees, costs and other amounts related thereto. The
Lender is willing to make such a loan to the Borrower on the terms contained
herein.”

1.2 Amendments to Section 1.1. The following definitions in Section 1.1 of the
Agreement are hereby amended and restated to read in its entirety as follows:

 

““Commitment” means one million seven hundred sixty-eight thousand ten Dollars
and twenty nine cents ($1,768,010.29).”

 

““Interest and Fee Reserve” means $50,449.”

 

“”Season One” shall mean collectively, each of the Season One Episodes,
including the sound recordings thereof, as well as trailers and clips thereof,
produced by means of any photographic, electronic, mechanical or other processes
or devices now or hereafter known, invented, used or contemplated, by which
photographs, films, drawings, images or other visual reproductions or
representations are or may be printed, imprinted, recorded or otherwise
preserved on film, tape or any other material of any description (whether
translucent or not) for later projection, exhibition or transmission by any
means or media now known or hereafter devised, in such manner that the same are
or appear to be in motion or in sequence on a screen, mirror, tube or other
medium or device, whether or not accompanied by sound recording.”

 

““Season One Episodes” collectively means each of episodes of Season One and
“Season One Episode” means any of the Season One Episodes.”

 

““Season Two” shall mean collectively, each of the Season Two Episodes,
including the sound recordings thereof, as well as trailers and clips thereof,
produced by means of any photographic, electronic, mechanical or other processes
or devices now or hereafter known, invented, used or contemplated, by which
photographs, films, drawings, images or other visual reproductions or
representations are or may be printed, imprinted, recorded or otherwise
preserved on film, tape or any other material of any description (whether
translucent or not) for later projection, exhibition or transmission by any
means or media now known or hereafter devised, in such manner that the same are
or appear to be in motion or in sequence on a screen, mirror, tube or other
medium or device, whether or not accompanied by sound recording.”

 

 

 

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““Season Two Borrower” means Llama Productions LLC, a California limited
liability company, in its capacity as borrower under the Season Two Loan
Agreement.”

 

““Season Two Episodes” collectively means each of the ten (10) sequential
episodes of Season Two, and “Season Two Episode” means any of the Season Two
Episodes.”

 

““Season Two Loan Agreement” means the Loan and Security Agreement between the
Lender and the Season Two Borrower in connection with Season Two.”

 

““Season Two Obligations” means, the ‘Obligations’ of the Season Two Borrower as
defined in the Season Two Loan Agreement.”

 

““Series” means the premium pay animated children’s television series
tentatively entitled Llama Llama, by whatever title such television series is
now or may hereafter become known, including Season One, Season Two and any
subsequent seasons.”

 

1.3 Amendment of Obligations. The definition of Obligations contained in Section
1.1 of the Agreement is hereby amended and restated to read in its entirety as
follows:

 

““Obligations” collectively means (a) all present and future loans, advances,
liabilities, obligations, covenants, duties, and indebtedness owing by the
Borrower to the Lender in connection with the Series, whether or not arising
under this Agreement or any of the other Loan Documents, whether or not
evidenced by any note, or other instrument or document, whether arising from an
extension of credit, opening of a letter of credit, acceptance, loan, guaranty,
indemnification or otherwise, whether direct or indirect (including, without
limitation, those acquired by assignment from others, and any participation by
the Lender in any of Borrower’s and/or any such other Person’s debts owing to
others), absolute or contingent, due or to become due, primary or secondary, as
principal or guarantor, and including, without limitation, all principal,
interest (including interest accruing prior to or after the initiation of
insolvency proceedings, whether or not allowed), charges, expenses, fees,
reasonable outside attorneys’ fees and costs, filing fees and any other sums
chargeable to the Borrower hereunder or under any other Loan Document; and (b)
the Season Two Obligations.”

 

1.4 Amendment of Section 4.6. Section 4.6 of the Agreement is hereby amended and
restated to read in its entirety as follows:

 

“Apportionment, Application and Reversal of Payments. All payments not
constituting payment of specific fees and all Collateral Proceeds received by
the Lender shall be applied, subject to the provisions of this Agreement, first,
to pay any fees, expense reimbursements or indemnities (other than interest and
principal) then due to the Lender from the Borrower; second, to pay interest due
in respect of all Loans; third, to pay principal of the Loans; fourth, to the
payment of any other Obligations due to the Lender, exclusive of the Season Two
Obligations; and fifth, to pay the Season Two Obligations. Notwithstanding any
provision of this or any of the other Loan Documents to the contrary, if the
Lender determines at any time that the Interest and Fee Reserve will be less
than the total amount of interest accruing on the Loan before repayment thereof
in full, then the Lender may retain proceeds in the Collection Account, in an
amount determined by the Lender in its reasonable discretion to pay interest, at
the interest rates provided for under this Agreement, owing on the Obligations
on a current basis as a cash reserve to be applied by the Lender to interest as
and when due hereunder. The Lender shall have the continuing and exclusive right
to apply and reverse and reapply any and all such proceeds and payments to any
portion of the Obligations in such order as the Lender may determine in its sole
and absolute discretion.”

 

1.5 Amendment of Section 11.1. Section 11.1 of the Agreement is hereby amended
by the addition of a new Subsection (r) as follows:

 

“(r)       an Event of Default under the terms of the Season Two Loan
Agreement.”

 

 

ARTICLE 2 – CONDITIONS

 

2.1 Conditions Precedent. This Amendment shall become effective upon the
execution and delivery of this Amendment and Amendment No. 2 to the Promissory
Note being entered into concurrently herewith.

 

 

 

 

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ARTICLE 3 – GENERAL PROVISIONS

 

3.1 Full Force and Effect. Except as expressly amended hereby, the Agreement is
and shall remain unmodified and in full force and effect.

 

3.2 Counterparts. This Amendment may be executed in any number of counterparts,
each of which shall be an original of this Amendment and all of such
counterparts taken together shall be deemed to constitute one and the same
instrument. Executed copies of the signature pages of this Amendment sent by
facsimile or transmitted electronically in either Tagged Image Format Files
(TIFF) or Portable Document Format (PDF) or other customary universal formats
shall be treated as originals, fully binding and with full legal force and
effect, and the parties waive any rights they may have to object to such
treatment. Any party delivering an executed signature page to this Amendment by
facsimile, TIFF or PDF shall also deliver a manually executed counterpart of
this Amendment as quickly as practicable after execution of this Amendment, but
failure to do so shall not of itself entitle a Party to treat this Amendment as
invalid, unenforceable, or without binding effect.

 

3.3 Governing Law. This Amendment and the rights and obligations of the parties
hereto shall be governed by and construed and enforced in accordance with the
laws of the State of California without reference to its conflict or choice of
law principles.

 

3.4 Final Agreement. This Amendment is intended by the Borrower and the Lender
to be the final, complete, and exclusive expression of the agreement between
them with respect to the subject matter hereof. This Amendment supersedes any
and all prior oral or written agreements relating to the subject matter hereof.

 

[signatures appear on next page]

 

 

 

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IN WITNESS WHEREOF, the parties have executed this Amendment by and through its
duly authorized representative as of the date and year first written above.

 

“LENDER”

Bank Leumi USA

 

By: /s/ David K. Henry

Name: David K. Henry

Its: First Vice President

 

By: /s/ Catherine C. Burke

Name: Catherine Burke

Its: Vice President

“BORROWER”

Llama Productions LLC

 

 

By: /s/ Andy Heyward

Name: Andy Heyward

Its: President

 

 

 

 

 

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