EXHIBIT 10.2

SECURITY AGREEMENT

SECURITY AGREEMENT, dated July 5, 2018, by and between Dolphin Entertainment,
Inc., a Florida corporation, with headquarters located at 2151 Le Jeune Road,
Suite 150-Mezzanine, Coral Gables, FL 33134 (the “Debtor”), and the investors
set forth on Schedule A hereof (collectively, the “Secured Party”).

Debtor hereby agrees in favor of Secured Party as follows:

1.

In consideration for loans made or to be made to Debtor evidenced by the Senior
Secured Convertible Promissory Notes of Debtor in the principal amounts set
forth on Schedule A hereto, payable to the order of Secured Party (such Senior
Secured Convertible Promissory Notes, as amended, modified, supplemented,
replaced or substituted from time to time, being herein referred to as the
“Notes”), Debtor hereby grants to Secured Party a continuing security interest
in, lien upon and a right of setoff against, and Debtor hereby assigns to
Secured Party, all of Debtor’s right, title and interest in and to the
Collateral described in Section 2, to secure the full and prompt payment,
performance and observance of all present and future indebtedness, obligations,
liabilities and agreements of any kind of Debtor to Secured Party arising under
or in connection with the Notes, which is existing now or hereafter (all of the
foregoing being herein referred to as the “Obligations”).  

2.

The Collateral is described on Schedule B annexed hereto as part hereof and on
any separate schedule(s) identified as Collateral at any time or from time to
time furnished by Debtor to Secured Party (all of which are hereby deemed part
of this Security Agreement) and includes claims of Debtor against third parties
for loss or damage to or destruction of any Collateral.  

3.

Debtor hereby warrants, represents, covenants and agrees (as of the date hereof
and so long as any Obligation remains outstanding) that:  (a) the chief
executive office and other places of business of Debtor, the books and records
relating to the Collateral (except for such records as are in the possession or
control of Secured Party) and the Collateral are located at 2151 Le Jeune Road,
Suite 150-Mezzanine, Coral Gables, FL 33134, or at the principal executive
offices of The Door Marketing Group, LLC (the “Grantor”) located at 37 West 17th
Street, 5th Floor, New York, NY 10011, and Debtor will not change any of the
same, or merge or consolidate with any person or change its name or conduct the
business under any trade, assumed or fictitious name, without prior written
notice to and consent of Secured Party (and in the case of location of
Collateral, will from time to time notify Secured Party of the locations
thereof); (b) the Collateral is and will be used in the business of the Grantor;
(c) the Collateral is now, and at all times will be, owned by Debtor (through
its ownership of 100% of the membership interests of the Grantor) free and clear
of all liens, security interests, claims and encumbrances, except for Permitted
Liens; (d) Debtor will not abandon or assign, sell, lease, transfer or otherwise
dispose of, other than in the ordinary course of Debtor’s

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business or as permitted by the Securities Purchase Agreement, nor will Debtor
suffer or permit any of the same to occur with respect to, any Collateral,
without prior written notice to and consent of a designated representative of
the Secured Party; (e) Debtor will make payment or will provide for the payment,
when due, of all taxes, assessments or contributions or other public or private
charges which have been or may be levied or assessed against Debtor or the
Grantor, with respect to the Collateral, to any wages or salaries paid by the
Grantor (except for any taxes, assessments, contributions or charges being
contested in good faith and as to which adequate reserves have been made), and
will deliver to Secured Party, on demand, certificates or other evidence
satisfactory to Secured Party attesting thereto and shall cause the Grantor to
take any such action as described under this Section 3(e); (f) Debtor will use
the Collateral for lawful purposes only, with all reasonable care and caution
and in conformity in all material respects with all applicable laws, ordinances
and regulations; (g) Debtor will, at Debtor’s sole cost and expense, keep the
Collateral in good order, repair, running condition and in substantially the
same condition as on the date hereof, reasonable wear and tear excepted, and
Debtor will not, without the prior written consent of Secured Party, alter or
remove any identifying symbol or number upon any of the Collateral; (h) Secured
Party shall at all times have free access to and right of inspection of any
Collateral, upon reasonable prior notice and during regular business hours) and
any papers, instruments and records pertaining thereto (and the right to make
extracts from and to receive from Debtor originals or true copies of such
records, papers and instruments upon request therefor) and Debtor hereby grants
to Secured Party a security interest in all such records, papers and instruments
to secure the payment, performance and observance of the Obligations; (i) the
Collateral is now and shall remain personal or intangible property, and Debtor
will not permit any other types of Collateral to become a fixture without prior
written notice to and consent of Secured Party and without first making all
arrangements, and delivering, or causing to be delivered, to Secured Party all
instruments and documents, including, without limitation, waivers and
subordination agreements by any landlords or mortgagees, requested by and
satisfactory to Secured Party to preserve and protect the primary security
interest granted herein against all persons; (j) Debtor will, at its sole cost
and expense, perform all acts and execute all documents requested by Secured
Party from time to time to evidence, perfect, maintain or enforce Secured
Party’s security interest granted herein or otherwise in furtherance of the
provisions of this Security Agreement; (k) at any time and from time to time,
Debtor shall, at its sole cost and expense, execute and deliver, or cause to be
executed and delivered, to Secured Party such financing statements pursuant to
the Uniform Commercial Code (“UCC”), applications for certificate of title and
other papers, documents or instruments as may reasonably be requested by Secured
Party in connection with this Security Agreement, and to the extent permitted by
applicable law, Debtor hereby authorizes Secured Party to execute and file at
any time and from time to time one or more financing statements or copies
thereof or of this Security Agreement with respect to the Collateral signed only
by Secured Party, and Debtor agrees to pay (or cause to be paid) any recording
tax or similar tax arising in connection with the filing of any such financing
statement and further agrees to pay any additional recording or similar tax
which is incurred in connection therewith; (l) Debtor assumes all responsibility
and liability arising from the Collateral; (m) in their discretion, Secured
Party may, at any time and from time to time, upon the occurrence and during

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the continuance of a Default (as hereinafter defined), demand, sue for, collect
or receive any money or property at any time payable or receivable on account of
or in exchange for, or make any compromise or settlement deemed desirable by
Secured Party with respect to, any Collateral, and/or extend the time of
payment, arrange for payment in installments, or otherwise modify the terms of,
or release, any of the Obligations and/or the Collateral, or any obligor, maker,
endorser, acceptor, surety or guarantor of, or any Party to, any of the
Obligations or the Collateral, all without notice to or consent by Debtor and
without otherwise discharging or affecting the Obligations or the Collateral;
(n) in their discretion, Secured Party may, at any time and from time to time,
for the account of Debtor, pay any amount or do any act required of Debtor
hereunder and which Debtor fails to do or pay, and any such payment shall be
deemed an advance by Secured Party to Debtor payable on demand together with
interest at the highest rate then payable on any of the Obligations; (o) Debtor
will promptly pay Secured Party for any and all reasonable and documented
out-of-pocket sums, costs, and expenses which Secured Party may pay or incur
pursuant to the provisions of this Security Agreement or in perfecting,
defending, protecting or enforcing this Security Agreement or the security
interest granted herein or in enforcing payment of the Obligations or otherwise
in connection with the provisions hereof, including, but not limited to, all
search, filing and recording fees, taxes, fees and expenses for the service and
filing of papers, premium on bonds and undertakings, fees of marshals, sheriffs,
custodians, auctioneers, court costs, collection charges, travel expenses, and
reasonable attorneys’ fees, all of which together with interest at the highest
rate then payable on any of the Obligations, shall be part of the Obligations
and be payable on demand; and (p) upon the occurrence and during the continuance
of a Default, any proceeds of the Collateral received by Debtor shall not be
commingled with other property of Debtor, but shall be segregated, held by
Debtor in trust for Secured Party, and immediately delivered to Secured Party in
the form received, duly endorsed in blank where appropriate to effectuate the
provisions hereof, the same to be held by Secured Party as additional Collateral
hereunder or, at Secured Party’ option, to be applied to payment of the
Obligations, whether or not due and in any order. Whenever any act is referred
to herein as being taken by the Secured Party, it shall mean by the Agent
appointed by all of the Lenders pursuant to Section 6 hereof.

4.

The term “Default” as used in this Security Agreement shall mean any Event of
Default, as such term is defined in the Notes.

5.

Upon the occurrence and during the continuance of any Default, Secured Party
may, without notice to (except as herein set forth) or demand upon Debtor,
declare any Obligations immediately due and payable and Secured Party shall have
the following rights and remedies (to the extent permitted by applicable law) in
addition to all rights and remedies of a Secured Party under the UCC or of
Secured Party under the Obligations, all such rights and remedies being
cumulative, not exclusive and enforceable alternatively, successively or
concurrently:

(a)

Secured Party may, at any time and from time to time, with or without judicial
process or the aid and assistance of others, (i) enter upon any premises in
which any Collateral may be located and, without resistance or interference by
Debtor,

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take possession of the Collateral, (ii) dispose of any part or all of the
Collateral on any such premises, (iii) require Debtor to assemble and make
available to Secured Party at the expense of Debtor any part or all of the
Collateral at any place and time designated by Secured Party which is reasonably
convenient to both parties, (iv) remove any part or all of the Collateral from
any such premises for the purpose of effecting sale or other disposition thereof
(and if any of the Collateral consists of motor vehicles, Secured Party may use
Debtor’s license plates), and (v) sell, resell, lease, assign and deliver, grant
options for or otherwise dispose of any part or all of the Collateral in its
then condition or following any commercially reasonable preparation or
processing, at public or private sale or proceedings or otherwise, by one or
more contracts, in one or more parcels, at the same or different times, with or
without having the Collateral at the place of sale or other disposition, for
cash and/or credit, and upon any terms, at such place(s) and time(s) and to such
person(s) as Secured Party deems best, all without demand, notice or
advertisement whatsoever except that where an applicable statute requires
reasonable notice of sale or other disposition Debtor hereby agrees that the
sending of ten days’ notice by overnight mail, postage prepaid, to any address
of Debtor set forth in this Security Agreement shall be deemed reasonable notice
thereof.  If any Collateral is sold by Secured Party upon credit or for future
delivery, Secured Party shall not be liable for the failure of the purchaser to
pay for same and in such event Secured Party may resell or otherwise dispose of
such Collateral.  Secured Party may buy any part or all of the Collateral at any
public sale and, if any part or all of the Collateral is of a type customarily
sold in a recognized market or is of the type which is the subject of widely
distributed standard price quotations, Secured Party may buy such Collateral at
private sale and in each case may make payment therefor by any means, whether by
credit against the Obligations or otherwise.  Secured Party may apply the cash
proceeds actually received from any sale or other disposition to the reasonable
and documented expenses of retaking, holding, preparing for sale, selling,
leasing and the like, to reasonable and documented external attorneys’ fees and
all legal, travel and other expenses which may be incurred by Secured Party in
attempting to collect the Obligations, proceed against the Collateral or enforce
this Security Agreement or in the prosecution or defense of any action or
proceeding related to the Obligations, the Collateral or this Security
Agreement; and then to the Obligations in such order and as to principal or
interest as Secured Party may desire; and Debtor shall remain liable and will
pay Secured Party on demand any deficiency remaining, together with interest
thereon at the highest rate then payable on the Obligations and the balance of
any expenses unpaid, with any surplus to be paid to Debtor, subject to any duty
of Secured Party imposed by law to the holder of any subordinate security
interest in the Collateral known to Secured Party.

(b)

Secured Party may, at any time and from time to time, as appropriate, after the
occurrence and during the continuance of a Default set off and apply to the
payment of the Obligations, any Collateral in or coming into the possession of
Secured Party or their agents, without notice to Debtor and in such manner as
Secured Party may in their discretion determine.

6.

Secured Party may designate and appoint a collateral agent (“Agent”), as
attorney-in-fact of Debtor, irrevocably and with power of substitution, with

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authority to:  endorse the name of Debtor on any notes, acceptances, checks,
drafts, money orders, instruments or other evidences of Collateral that may come
into Secured Party’s possession; sign the name of Debtor on any invoices,
documents, assignments; execute proofs of claim and loss; execute endorsements,
assignments or other instruments of conveyance or transfer; adjust and
compromise any claims under insurance policies or otherwise; execute releases;
and do all other acts and things necessary or advisable in the sole discretion
of Secured Party to carry out and enforce this Security Agreement or the
Obligations.  Neither Secured Party nor any designee or agent thereof shall be
liable for any acts of commission or omission done in good faith, for any error
of judgment or for any mistake of fact or law.  This power of attorney being
coupled with an interest is irrevocable while any Obligations shall remain
unpaid.

7.

With respect to the enforcement of Secured Party’s rights under this Security
Agreement, Debtor hereby releases Secured Party and Agent from any claims,
causes of action and demands at any time arising out of or with respect to this
Security Agreement, the Obligations, the Collateral and its use and/or any
actions taken or omitted to be taken by Secured Party or Agent in good faith
with respect thereto, and Debtor hereby agrees to hold Secured Party and Agent
harmless from and with respect to any and all such claims, causes of action and
demands.

8.

Secured Party’s prior recourse to any Collateral shall not constitute a
condition of any demand, suit or proceeding for payment or collection of the
Obligations nor shall any demand, suit or proceeding for payment or collection
of the Obligations constitute a condition of any recourse by Secured Party to
the Collateral.  Any suit or proceeding by Secured Party to recover any of the
Obligations shall not be deemed a waiver of, or bar against, subsequent
proceedings by Secured Party with respect to any other Obligations and/or with
respect to the Collateral.  No act, omission or delay by Secured Party shall
constitute a waiver of their rights and remedies hereunder or otherwise.  No
single or partial waiver by Secured Party of any covenant, warranty,
representation, Default or right or remedy which they may have shall operate as
a waiver of any other covenant, warranty, representation, Default, right or
remedy or of the same covenant, warranty, representation, Default, right or
remedy on a future occasion.  Debtor hereby waives presentment, notice of
dishonor and protest of all instruments included in or evidencing any
Obligations or Collateral, and all other notices and demands whatsoever (except
as expressly provided herein).

9.

Debtor hereby agrees to pay, on demand, all reasonable and documented
out-of-pocket expenses incurred by Secured Party in connection with the
enforcement of the Note, this Security Agreement, and the Obligations and in
connection with any amendment, including, without limitation, the fees and
disbursements of counsel to Secured Party.

10.

In the event of any litigation with respect to any matter connected with this
Security Agreement, the Obligations, the Collateral or the Note, Debtor hereby
waives the right to a trial by jury and all rights of setoff.  Debtor hereby
waives personal service of any process in connection with any such action or
proceeding and agrees that

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the service thereof may be made by certified or registered mail directed to
Debtor at any address of Debtor set forth in this Security Agreement.  In the
alternative, Secured Party may in their discretion effect service upon Debtor in
any other form or manner permitted by law.

11.

Upon the payment in full of the Notes and satisfaction of all Obligations in
accordance with the Notes or the occurrence of the event described in the third
paragraph of Section 1 hereof, the security interest granted hereby in the
Collateral shall terminate and all rights to the Collateral under this Agreement
shall revert to Debtor.  Upon any such termination, the Debtor shall have the
right to file UCC–3 financing statement releases or other documents of release
reasonably required to reflect the termination of the security interest
contemplated hereby.

12.

Secured Party may assign their rights and obligation hereunder to any Affiliate
of Secured Party provided that such Affiliate assumes all of the liabilities or
obligations of Secured Party hereunder.  For purposes of this section,
“Affiliate” of any person means any other person or entity which, directly or
indirectly, controls or is controlled by that person, or is under common control
with that person or entity.  “Control” (including, with correlative meaning, the
terms “controlled by” and “under common control with”), as used with respect to
any person or entity, means the possession, directly or indirectly, of the power
to direct or cause the direction of the management and policies of such person
or entity, whether through the ownership of voting securities, by contract or
otherwise.  

13.

All terms herein shall have the meanings as defined in the UCC, unless the
context otherwise requires.  No provision hereof shall be modified, altered,
waived, released, terminated or limited except by a written instrument expressly
referring to this Security Agreement and to such provision, and executed by the
Party to be charged.  The execution and delivery of this Security Agreement has
been authorized by any necessary vote or consent of Debtor.  This Security
Agreement and all Obligations shall be binding upon the successors and assigns
of Debtor and shall, together with the rights and remedies of Secured Party
hereunder, inure to the benefit of Secured Party, their executors,
administrators, successors, permitted endorsees and permitted assigns.  This
Security Agreement and the Obligations shall be governed in all respects by the
laws of the State of New York applicable to contracts executed and to be
performed in such state.  If any term of this Security Agreement shall be held
to be invalid, illegal or unenforceable, the validity of all other terms hereof
shall in no way be affected thereby.  Secured Party is authorized to annex
hereto any schedules referred to herein.  Debtor acknowledges receipt of a copy
of this Security Agreement.

14.

All notices and other communications under this Agreement shall be in writing
and shall be deemed given when delivered personally, by e-mail, by overnight
mail or delivery service or mailed by certified mail, return receipt requested,
to the parties.

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IN WITNESS WHEREOF, the undersigned have executed or caused this security
agreement to be executed on the date first above set forth.

 

DEBTOR:

 

 

 

 

DOLPHIN ENTERTAINMENT, INC.

 

 

 

 

 

 

 

By:

/s/ William O’Dowd

 

 

Name: William O’Dowd IV

      

 

Title: Chief Executive Officer

Secured Party:

PINNACLE FAMILY OFFICE INVESTMENTS, L.P.

By:

 

 

Name:

Barry M. Kitt

 

Title:

Manager, Pinnacle Family Office, LLC, the General Partner of Pinnacle Family
Office Investments, L.P.

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SCHEDULE A

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SCHEDULE B

As used in this Agreement, the term “Collateral” means, collectively, wherever
located, whether now owned or hereafter acquired or now existing or hereafter
acquired or created, all right, title and interest of the Debtor in and to all
of its assets (other than the assets and equity interests of the Debtor’s
subsidiaries as of the date hereof, unless specifically provided for herein or
any assets or equity interests of any Production Subsidiary) and its assets of
The Door Marketing Group, LLC, including, without limitation: (i) accounts,
chattel paper, deposit accounts, documents, general intangibles (including, but
not limited to intellectual property, payment intangibles, software, licenses,
franchises and customer information), goods (including, but not limited to
equipment, fixtures and inventory), instruments, investment property,
letter-of-credit rights, money, other personal property, software, any
commercial tort claims; (ii) to the extent not referred to in clause (i) of this
sentence, all (A) supporting obligations and incidental property rights incident
to, arising or accruing pursuant to or otherwise relating to any of the things
referred to in clause (i) of this sentence, whether arising or accruing from any
action taken by the Debtor or the Agent or otherwise, (B) proceeds of any of the
items referred to in clauses (i) and (ii)(A) of this sentence and (C) books and
records relating to any of the items referred to in clauses (i) and (ii)(A) and
(B) of this sentence.

For purposes herein, “Production Subsidiary” means any subsidiary formed for the
purpose of, or otherwise engaged in acquiring, distributing or producing motion
pictures, television series or digital series.