Exhibit 10.20.2

AMENDMENT NUMBER FIVE TO CREDIT AGREEMENT

This AMENDMENT NUMBER FIVE TO CREDIT AGREEMENT (this “Amendment”), dated as of
April 8, 2011 is entered into by and between JMP GROUP LLC, a Delaware limited
liability company (“Borrower”), and CITY NATIONAL BANK, a national banking
association (“Lender”), and in light of the following:

W I T N E S S E T H

WHEREAS, Borrower and Lender are party to that certain Credit Agreement, dated
as of August 3, 2006 (as amended, restated, supplemented, or otherwise modified
from time to time, the “Credit Agreement”);

WHEREAS, the Borrower has requested that Lender make certain amendments to the
Credit Agreement; and

WHEREAS, upon the terms and conditions set forth herein, Lender is willing to
accommodate the Borrower’s requests.

NOW, THEREFORE, in consideration of the foregoing and the mutual covenants
herein contained, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereby agree as
follows:

1. DEFINITIONS. Capitalized terms used herein and not otherwise defined herein
shall have the meanings ascribed to them in the Credit Agreement, as amended
hereby.

2. AMENDMENTS TO CREDIT AGREEMENT.

a. Section 1.1 of the Credit Agreement is hereby amended by inserting or
amending and restating, as applicable, the following definitions in their
entirety:

““Broker/Dealer Credit Facility” means the credit facility evidenced by that
certain Revolving Note and Cash Subordination Agreement, dated as of April 8,
2011, by and among Lender and Jolson Merchant Partners, LLC, a Delaware limited
liability company, as amended, restated, supplemented, or otherwise modified
from time to time.”

““Broker/Dealer Guaranty” means that certain General Continuing Guaranty, dated
as of April 8, 2011, executed by Borrower in favor of Lender in respect of the
Debt evidenced by the Broker/Dealer Credit Facility, as such guaranty may be
amended, restated, supplemented, or otherwise modified from time to time.”

““Loan Documents” means this Agreement, the Bank Product Agreements, the Control
Agreements (if any), the Guaranty, Broker/Dealer Guaranty, the Intercompany
Subordination Agreement, the Letters of Credit, the Security Agreement, the
Stock Pledge Agreement, the Trademark Security Agreement and any and all other
documents, agreements or instructions that have been or are entered into by
Borrower or any Guarantor, and Lender in connection with the transactions
contemplated by this Agreement.”

 

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b. Section 7.1 of the Credit Agreement is hereby amended by (i) deleting the
“or” at the end of clause (m) thereof, (ii) replacing the period at the end of
clause (n) thereof with “; or”, and (iii) adding the following new clause (o) at
the end thereof:

“(o) If any loan under the Broker/Dealer Credit Facility remains outstanding for
more than 30 days.”

3. REPRESENTATIONS AND WARRANTIES. Borrower hereby represents and warrants to
Lender as follows:

a. Borrower has the requisite power and authority to execute and deliver this
Amendment and the authority to perform its obligations hereunder and under the
Loan Documents to which it is a party. The execution, delivery, and performance
of this Amendment and the performance by Borrower of each Loan Document to which
it is a party (i) have been duly approved by all necessary action and no other
proceedings are necessary to consummate such transactions; and (ii) are not in
contravention of (A) any law, rule, or regulation, or any order, judgment,
decree, writ, injunction, or award of any arbitrator, court or governmental
authority binding on it, (B) the terms of its organizational documents, or
(C) any provision of any contract or undertaking to which it is a party or by
which any of its properties may be bound or affected;

b. This Amendment has been duly executed and delivered by Borrower. This
Amendment will, upon its effectiveness in accordance with the terms hereof, and
each Loan Document to which Borrower is a party is the legal, valid and binding
obligation of Borrower, enforceable against Borrower in accordance with its
terms, and is in full force and effect except as such validity and
enforceability is limited by the laws of insolvency and bankruptcy, laws
affecting creditors’ rights and principles of equity applicable hereto;

c. No injunction, writ, restraining order, or other order of any nature
prohibiting, directly or indirectly, the consummation of the transactions
contemplated herein has been issued and remains in force by any Governmental
Authority against Borrower;

d. Borrower does not have any actual or potential claim or cause of action
against Lender for any actions or events occurring on or before the date hereof,
and Borrower hereby waives and releases any right to assert same;

e. No Default or Event of Default has occurred and is continuing on the date
hereof or as of the date of the effectiveness of this Amendment after giving
effect to this Amendment; and

f. The representations and warranties in the Credit Agreement and the other Loan
Documents are true and correct in all respects on and as of the date hereof, as
though made on such date (except to the extent that such representations and
warranties relate solely to an earlier date).

 

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4. CONDITIONS PRECEDENT TO THIS AMENDMENT The satisfaction of each of the
following shall constitute conditions precedent to the effectiveness of this
Amendment and each and every provision hereof:

a. Lender shall have received this Amendment, duly executed by Borrower, and the
same shall be in full force and effect;

b. Lender shall have received a reaffirmation and consent substantially in the
form attached hereto as Exhibit A, duly executed and delivered by each
Subsidiary of Borrower that is listed on the signature pages thereof;

c. Lender shall have received the Broker/Dealer Guaranty, dated as of the date
hereof, duly executed by Borrower, and the same shall be in full force and
effect;

d. Lender shall have received that certain Amendment Number One to General
Continuing Guaranty, dated as of the date hereof, duly executed by Guarantor,
and the same shall be in full force and effect;

e. The representations and warranties in the Credit Agreement and the other Loan
Documents shall be true and correct in all respects on and as of the date
hereof, as though made on such date (except to the extent that such
representations and warranties relate solely to an earlier date);

f. No Default or Event of Default shall have occurred and be continuing as of
the date of the effectiveness of this Amendment after giving effect to this
Amendment; and

g. No injunction, writ, restraining order, or other order of any nature
prohibiting, directly or indirectly, the consummation of the transactions
contemplated herein shall have been issued and remain in force by any
Governmental Authority against Borrower.

h. All other documents and legal matters in connection with the transactions
contemplated by this Amendment shall have been delivered, executed, or recorded
and shall be in form and substance reasonably satisfactory to Lender.

5. AGREEMENTS. This Amendment has been entered into without force or duress, of
the free will of Borrower, and the decision of Borrower to enter into this
Amendment is a fully informed decision and Borrower is aware of all legal and
other ramifications of each decision. It has read and understands this
Amendment, has consulted with and been represented by independent legal counsel
of its own choosing in negotiations for and the preparation of this Amendment,
has read this Amendment in full and final form, and has been advised by its
counsel of its rights and obligations hereunder and thereunder.

6. PAYMENT OF COSTS AND FEES. Borrower shall reimburse Lender on demand for all
of its actual out-of-pocket costs, expenses, fees and charges in connection with
the preparation, negotiation, execution and delivery of this Amendment and any
documents and instruments relating hereto (which costs may include the
reasonable fees and expenses of any attorneys retained by Lender).

 

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7. CONSTRUCTION. THIS AMENDMENT SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAW OF THE STATE OF CALIFORNIA APPLICABLE TO CONTRACTS MADE
AND TO BE PERFORMED IN THE STATE OF CALIFORNIA.

8. ENTIRE AMENDMENT; EFFECT OF AMENDMENT. This Amendment, and terms and
provisions hereof, the Credit Agreement and the other Loan Documents constitute
the entire understanding and agreement between the parties hereto with respect
to the subject matter hereof and supersedes any and all prior or contemporaneous
amendments or understandings with respect to the subject matter hereof, whether
express or implied, oral or written. Except for the amendments to the Credit
Agreement expressly set forth in Section 2, hereof, the Credit Agreement and
other Loan Documents shall remain unchanged and in full force and effect. Except
as expressly set forth herein, the execution, delivery, and performance of this
Amendment shall not operate as a waiver of or as an amendment of any right,
power, or remedy of the Lenders as in effect prior to the date hereof. The
amendments set forth herein are limited to the specifics hereof, shall not apply
with respect to any facts or occurrences (or any Subsidiary other than the New
Subsidiaries) other than those on which the same are based, shall not excuse
future non-compliance with the Credit Agreement, and shall not operate as a
consent to any further or other matter, under the Loan Documents. To the extent
any terms or provisions of this Amendment conflict with those of the Credit
Agreement or other Loan Documents, the terms and provisions of this Amendment
shall control. This Amendment is a Loan Document.

9. COUNTERPARTS; TELEFACSIMILE EXECUTION. This Amendment may be executed in any
number of counterparts, all of which when taken together shall constitute one
and the same instrument and any of the parties hereto may execute this Amendment
by signing any such counterpart. Delivery of an executed counterpart of this
Amendment by telefacsimile or electronic mail shall be equally as effective as
delivery of an original executed counterpart of this Amendment. Any party
delivering an executed counterpart of this Amendment by telefacsimile or
electronic mail also shall deliver an original executed counterpart of this
Amendment, but the failure to deliver an original executed counterpart shall not
affect the validity, enforceability, and binding effect of this Amendment.

10. EFFECT ON LOAN DOCUMENTS.

a. The Credit Agreement, as amended hereby, and each of the other Loan Documents
shall be and remain in full force and effect in accordance with their respective
terms and hereby are ratified and confirmed in all respects. Except for the
amendments to the Credit Agreement expressly set forth herein, the Credit
Agreement and other Loan Documents shall remain unchanged and in full force and
effect. The execution, delivery and performance of this Amendment shall not
operate, except as expressly set forth herein, as a modification or waiver of
any right, power, or remedy of Lender under the Credit Agreement or any other
Loan Document. The amendments set forth herein are limited to the specifics
hereof, and, except as expressly set forth herein, shall neither excuse any
future non-compliance with the Credit Agreement, nor operate as a waiver of any
Unmatured Event of Default or Event of Default.

b. Upon and after the effectiveness of this Amendment, each reference in the
Credit Agreement to “this Agreement”, “hereunder”, “herein”, “hereof” or words
of like import

 

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referring to the Credit Agreement, and each reference in the other Loan
Documents to “the Credit Agreement”, “thereunder”, “therein”, “thereof” or words
of like import referring to the Credit Agreement, shall mean and be a reference
to the Credit Agreement as modified and amended hereby.

c. To the extent any terms or provisions of this Amendment conflict with those
of the Credit Agreement or other Loan Documents, the terms and provisions of
this Amendment shall control. To the extent that any terms and conditions in any
of the Loan Documents shall contradict or be in conflict with any terms or
conditions of the Credit Agreement, after giving effect to this Amendment, such
terms and conditions are hereby deemed modified or amended accordingly to
reflect the terms and conditions of the Credit Agreement as modified or amended
hereby.

d. This Amendment is a Loan Document.

e. Unless the context of this Amendment clearly requires otherwise, references
to the plural include the singular, references to the singular include the
plural, the terms “includes” and “including” are not limiting, and the term “or”
has, except where otherwise indicated, the inclusive meaning represented by the
phrase “and/or”.

11. REAFFIRMATION OF OBLIGATIONS. The Borrower hereby restates, ratifies and
reaffirms each and every term and condition set forth in the Credit Agreement
and the other Loan Documents to which it is a party effective as of the date
hereof and as amended hereby. The Borrower hereby further ratifies and reaffirms
the validity and enforceability of all of the liens and security interests in
the Collateral heretofore granted, pursuant to and in connection with any Loan
Document to Lender as collateral security for the obligations under the Loan
Documents in accordance with their respective terms, and acknowledges that all
of such liens and security interests, and all Collateral heretofore pledged as
security for such obligations, continues to be and remain collateral for such
obligations from and after the date hereof, in each case except as otherwise
expressly provided in the Loan Documents.

12. SEVERABILITY. In case any provision in this Amendment shall be invalid,
illegal or unenforceable, such provision shall be severable from the remainder
of this Amendment and the validity, legality and enforceability of the remaining
provisions shall not in any way be affected or impaired thereby.

 

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IN WITNESS WHEREOF, the parties have caused this Amendment to be executed and
delivered as of the date first written above.

 

BORROWER:  

JMP GROUP LLC,

a Delaware limited liability company

 

  By:     

/s/ Joseph A. Jolson

  Title:      Chief Executive Officer

[SIGNATURE PAGE TO AMENDMENT NUMBER FIVE TO CREDIT AGREEMENT AND WAIVER]

 

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LENDER:  

CITY NATIONAL BANK,

a national banking corporation

 

  By:   

/s/ Garen Papazyan

  Title:    Vice President

[SIGNATURE PAGE TO AMENDMENT NUMBER FIVE TO CREDIT AGREEMENT AND WAIVER]

 

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EXHIBIT A

REAFFIRMATION AND CONSENT

All capitalized terms used herein but not otherwise defined herein shall have
the meanings ascribed to them in (a) that certain Credit Agreement entered into
between JMP GROUP LLC, a Delaware limited liability company (“Borrower”), and
CITY NATIONAL BANK, a national banking association (“Lender”), dated as of
August 3, 2006 (as amended, restated, supplemented or otherwise modified from
time to time, the “Credit Agreement”), and (b) that certain Amendment Number
Five to Credit Agreement, dated as of April 8, 2011 (the “Amendment”) by and
among Borrower and Lender. The undersigned hereby (a) represents and warrants to
Lender that the execution, delivery, and performance of this Reaffirmation and
Consent are within its powers, have been duly authorized by all necessary
action, and are not in contravention of any law, rule, or regulation, or any
order, judgment, decree, writ, injunction, or award of any arbitrator, court, or
governmental authority, or of the terms of its charter or bylaws, or of any
contract or undertaking to which it is a party or by which any of its properties
may be bound or affected; (b) consents to the transactions contemplated by the
Amendment and by each amendment to any Loan Document executed on or before the
date hereof; (c) acknowledges and reaffirms its obligations owing to Lender
under any Loan Documents to which it is a party; and (d) agrees that each of the
Loan Documents to which it is a party is and shall remain in full force and
effect. Although each of the undersigned has been informed of the matters set
forth herein and has acknowledged and agreed to same, each understands that
Lender has no obligation to inform it of such matters in the future or to seek
its acknowledgment or agreement to future amendments, and nothing herein shall
create such a duty. Delivery of an executed counterpart of this Reaffirmation
and Consent by telefacsimile or electronic mail shall be equally as effective as
delivery of an original executed counterpart of this Reaffirmation and Consent.
Any party delivering an executed counterpart of this Reaffirmation and Consent
by telefacsimile or electronic mail also shall deliver an original executed
counterpart of this Reaffirmation and Consent but the failure to deliver an
original executed counterpart shall not affect the validity, enforceability, and
binding effect of this Reaffirmation and Consent. This Reaffirmation and Consent
shall be governed by the laws of the State of California.

[Signature page to follow.]

 

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IN WITNESS WHEREOF, the undersigned have each caused this Reaffirmation and
Consent to be executed as of the date of the Amendment.

 

HARVEST CAPITAL STRATEGIES LLC, a Delaware limited liability company By:  

/s/ Joseph A. Jolson

Title:   Chief Executive Officer

[SIGNATURE PAGE TO REAFFIRMATION AND CONSENT TO AMENDMENT NUMBER FIVE

TO CREDIT AGREEMENT]

 

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GENERAL CONTINUING GUARANTY

This GENERAL CONTINUING GUARANTY (this “Guaranty”), dated as of April 8, 2011,
is executed and delivered by JMP GROUP LLC, a Delaware limited liability company
(“Guarantor”), in favor of CITY NATIONAL BANK, a national banking association
(“Lender”), in light of the following:

WHEREAS, JOLSON MERCHANT PARTNERS, LLC, a Delaware limited liability company
(“Borrower”) and Lender are, contemporaneously herewith, entering into that
certain Revolving Note and Cash Subordination Agreement of even date herewith
(as amended, restated, supplemented, or otherwise modified from time to time,
the “Note Agreement”);

WHEREAS, Guarantor and Lender are parties to that certain Credit Agreement,
dated as of August 3, 2006 (as amended, restated, supplemented, or otherwise
modified from time to time, the “Credit Agreement”);

WHEREAS, in order to induce Lender to extend the loans and other financial
accommodations to Borrower pursuant to the Note Agreement, and in consideration
thereof, and in consideration of any loans or other financial accommodations
heretofore or hereafter extended by Lender to Borrower, whether pursuant to the
Note Agreement or the Note, Guarantor has agreed to guaranty the Guarantied
Obligations; and

WHEREAS, Guarantor will benefit by virtue of the financial accommodations
extended to Borrower by Lender.

NOW, THEREFORE, in consideration of the foregoing, Guarantor hereby agrees in
favor Lender as follows:

Definitions and Construction.

Definitions. Capitalized terms used herein and not otherwise defined herein
shall have the meanings ascribed to them in the Note Agreement. The following
terms, as used in this Guaranty, shall have the following meanings:

“Bankruptcy Code” means Title 11 of the United States Code, as amended or
supplemented from time to time, and any successor statute, and all of the rules
and regulations issued or promulgated in connection therewith.

“Borrower” has the meaning set forth in the recitals to this Guaranty.

“Dollars” and “$” mean United States of America dollars or such coin or currency
of the United States of America as at the time of payment shall be legal tender
for the payment of public and private debts in the United States of America.

 

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“Guarantied Obligations” means the Indebtedness now or hereafter existing under
the Note Agreement or the Note, whether for principal, interest (including all
interest that accrues after the commencement of any Insolvency Proceeding
irrespective of whether a claim therefor is allowed in such case or proceeding),
fees, expenses or otherwise, and any and all expenses (including reasonable
counsel fees and expenses) incurred by Lender in enforcing any rights under this
Guaranty. Without limiting the generality of the foregoing, Guarantied
Obligations shall include all amounts that constitute part of the Guarantied
Obligations and would be owed by the Borrower to Lender under the Note Agreement
or the Note but for the fact that they are unenforceable or not allowable due to
the existence of a bankruptcy, reorganization or similar proceeding involving
Borrower or any other guarantor.

“Guarantor” has the meaning set forth in the preamble to this Guaranty.

“Guaranty” has the meaning set forth in the preamble to this Guaranty.

“Indebtedness” means all advances, debts, principal, interest, premiums,
liabilities, obligations (including indemnification obligations), fees, charges,
costs, expenses (including any portion thereof that accrues after the
commencement of an Insolvency Proceeding, whether or not allowed or allowable in
whole or in part as a claim in any such Insolvency Proceeding), guaranties,
covenants, and duties of any kind and description owing by Borrower to Lender
pursuant to or evidenced by the Note Agreement or the Note and irrespective of
whether for the payment of money, whether direct or indirect, absolute or
contingent, due or to become due, now existing or hereafter arising, and
including all interest not paid when due and all expenses that Borrower is
required to pay or reimburse by the Note Agreement or the Note, by law, or
otherwise. Any reference in this Guaranty, in the Note Agreement or in the Note
to the Indebtedness shall include all extensions, modifications, renewals, or
alterations thereof, both prior and subsequent to any Insolvency Proceeding.

“Insolvency Proceeding” means any proceeding commenced by or against any Person
under any provision of the Bankruptcy Code or under any other state or federal
bankruptcy or insolvency law, assignments for the benefit of creditors, formal
or informal moratoria, compositions, extensions generally with creditors, or
proceedings seeking reorganization, arrangement, or other similar relief.

“Lender” has the meaning set forth in the preamble to this Guaranty.

“Note” means that certain Revolving Note, dated as of the date hereof, by
Borrower in favor of Lender.

“Note Agreement” has the meaning set forth in the recitals to this Guaranty.

 

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“Person” means and include natural persons, corporations, partnerships, limited
liability companies, joint ventures, associations, companies, business trusts,
or other organizations, irrespective of whether they are legal entities.

“Record” means information that is inscribed on a tangible medium or which is
stored in an electronic or other medium and is retrievable in perceivable form.

“SEC” means the Securities and Exchange Commission of the United States of
America or any successor thereto.

“Voidable Transfer” has the meaning set forth in Section 9 of this Guaranty.

Construction. Unless the context of this Guaranty clearly requires otherwise,
references to the plural include the singular, references to the singular
include the plural, the part includes the whole, the terms “includes” and
“including” are not limiting, and the term “or” has, except where otherwise
indicated, the inclusive meaning represented by the phrase “and/or”. The words
“hereof”, “herein”, “hereby”, “hereunder”, and other similar terms in this
Guaranty refer to this Guaranty as a whole and not to any particular provision
of this Guaranty. Section, subsection, clause, schedule and exhibit references
herein are to this Guaranty unless otherwise specified. Any reference in this
Guaranty to any agreement, instrument, or document shall include all
alterations, amendments, changes, extensions, modifications, renewals,
replacements, substitutions, joinders, and supplements, thereto and thereof, as
applicable (subject to any restrictions on such alterations, amendments,
changes, extensions, modifications, renewals, replacements, substitutions,
joinders, and supplements set herein). Neither this Guaranty nor any uncertainty
or ambiguity herein shall be construed or resolved against Lender or Borrower,
whether under any rule of construction or otherwise. On the contrary, this
Guaranty has been reviewed by all parties and shall be construed and interpreted
according to the ordinary meaning of the words used so as to accomplish fairly
the purposes and intentions of Guarantor and Lender. Any reference herein to the
satisfaction or payment in full of the Guarantied Obligations shall mean the
payment in full in cash of all Guarantied Obligations and the termination of the
Credit Line of Lender. Any reference herein to any Person shall be construed to
include such Person’s successors and assigns. Any requirement of a writing
contained herein shall be satisfied by the transmission of a Record and any
Record transmitted shall constitute a representation and warranty as to the
accuracy and completeness of the information contained therein. The captions and
headings are for convenience of reference only and shall not affect the
construction of this Guaranty.

Guarantied Obligations. Guarantor hereby irrevocably and unconditionally
guaranties to Lender, for the benefit of Lender, as and for its own debt, until
the final and indefeasible payment in full thereof, in cash, has been made,
(a) the due and punctual payment of the Guarantied Obligations, in each case
when and as the same shall become due and payable, whether at maturity, pursuant
to a mandatory prepayment requirement, by acceleration, or

 

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otherwise, in each case, without giving effect to Sections 2 or 3 of the Note
Agreement; it being the intent of Guarantor that the guaranty set forth herein
shall be a guaranty of payment and not a guaranty of collection; and (b) the
punctual and faithful performance, keeping, observance, and fulfillment by
Borrower of all of the agreements, conditions, covenants, and obligations of
Borrower contained in the Note Agreement and under the Note.

Continuing Guaranty. This Guaranty includes Guarantied Obligations arising under
successive transactions continuing, compromising, extending, increasing,
modifying, releasing, or renewing the Guarantied Obligations, changing the
interest rate, payment terms, or other terms and conditions thereof, or creating
new or additional Guarantied Obligations after prior Guarantied Obligations have
been satisfied in whole or in part. To the maximum extent permitted by law,
Guarantor hereby waives any right to revoke this Guaranty as to future
Guarantied Obligations. If such a revocation is effective notwithstanding the
foregoing waiver, Guarantor acknowledges and agrees that (a) no such revocation
shall be effective until written notice thereof has been received by Lender,
(b) no such revocation shall apply to any Guarantied Obligations in existence on
the date of receipt by Lender of such written notice (including any subsequent
continuation, extension, or renewal thereof, or change in the interest rate,
payment terms, or other terms and conditions thereof), (c) no such revocation
shall apply to any Guarantied Obligations made or created after such date to the
extent made or created pursuant to a legally binding commitment of Lender in
existence on the date of Lender’s receipt of written notice of such revocation,
(d) no payment by Guarantor, Borrower, or from any other source, prior to the
date of Lender’s such revocation shall reduce the maximum obligation of
Guarantor hereunder, and (e) any payment by Borrower or from any source other
than Guarantor subsequent to the date of such revocation shall first be applied
to that portion of the Guarantied Obligations as to which the revocation is
effective and which are not, therefore, guarantied hereunder, and to the extent
so applied shall not reduce the maximum obligation of Guarantor hereunder.

Performance Under this Guaranty. In the event that Borrower fails to make any
payment of any Guarantied Obligations, on or prior to the due date thereof,
without giving effect to Sections 2 or 3 of the Note Agreement and irrespective
of whether or not payment of such Guarantied Obligation is suspended under the
Note Agreement, or if Borrower shall fail to perform, keep, observe, or fulfill
any other obligation under the Note Agreement or the Note in the manner provided
therein, as applicable, Guarantor immediately shall cause, as applicable, such
payment in respect of the Guarantied Obligations to be made or such obligation
to be performed, kept, observed, or fulfilled.

Primary Obligations. This Guaranty is a primary and original obligation of
Guarantor, is not merely the creation of a surety relationship, and is an
absolute, unconditional, and continuing guaranty of payment and performance
which shall remain in full force and effect without respect to future changes in
conditions. Guarantor hereby agrees that it is directly, jointly and severally
with any other guarantor of the Guarantied Obligations, liable to Lender, that
the obligations of Guarantor hereunder are independent of the obligations of
Borrower or any other guarantor, and that a separate action may be brought
against Guarantor, whether such action is brought against Borrower or any other
guarantor or

 

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whether Borrower or any other guarantor is joined in such action. Guarantor
hereby agrees that its liability hereunder shall be immediate and shall not be
contingent upon the exercise or enforcement by Lender of whatever remedies it
may have against Borrower or any other guarantor, or the enforcement of any lien
or realization upon any security Lender may at any time possess. Guarantor
hereby agrees that any release which may be given by Lender to Borrower or any
other guarantor, or with respect to any property or asset subject to a Lien,
shall not release Guarantor. Guarantor consents and agrees that Lender shall not
be under any obligation to marshal any property or assets of Borrower or any
other guarantor in favor of Guarantor, or against or in payment of any or all of
the Guarantied Obligations.

Waivers.

To the fullest extent permitted by applicable law, Guarantor hereby waives:
(i) notice of acceptance hereof; (ii) notice of any loans or other financial
accommodations made or extended under the Note Agreement, or the creation or
existence of any Guarantied Obligations; (iii) notice of the amount of the
Guarantied Obligations, subject, however, to Guarantor’s right to make inquiry
of Lender to ascertain the amount of the Guarantied Obligations at any
reasonable time; (iv) notice of any adverse change in the financial condition of
Borrower or of any other fact that might increase Guarantor’s risk hereunder;
(v) notice of presentment for payment, demand, protest, and notice thereof as to
the Note Agreement or the Note; (vi) notice of any Default or Event of Default
under Note Agreement or the Note; and (vii) all other notices (except if such
notice is specifically required to be given to Guarantor under this Guaranty,
the Note Agreement or the Note) and demands to which Guarantor might otherwise
be entitled.

To the fullest extent permitted by applicable law, Guarantor hereby waives the
right by statute or otherwise to require Lender to institute suit against
Borrower or to exhaust any rights and remedies which Lender has or may have
against Borrower. In this regard, Guarantor agrees that it is bound to the
payment of each and all Guarantied Obligations, whether now existing or
hereafter arising, as fully as if the Guarantied Obligations were directly owing
to Lender by Guarantor. Guarantor further waives any defense arising by reason
of any disability or other defense (other than the defense that the Guarantied
Obligations shall have been fully and finally performed and indefeasibly paid in
full in cash, to the extent of any such payment) of Borrower or by reason of the
cessation from any cause whatsoever of the liability of Borrower in respect
thereof.

To the fullest extent permitted by applicable law, Guarantor hereby waives:
(i) any right to assert against Lender, any defense (legal or equitable),
set-off, counterclaim, or claim which Guarantor may now or at any time hereafter
have against Borrower or any other party liable to Lender; (ii) any defense,
set-off, counterclaim, or claim, of any kind or nature, arising directly or
indirectly from the present or future lack of perfection, sufficiency, validity,
or enforceability of the Guarantied Obligations or any security therefore;
(iii) any right or defense arising by reason of any claim or defense based upon
an election of remedies by Lender, including any defense based upon an election
of remedies by Lender; (iv) the benefit of any statute of limitations affecting
Guarantor’s liability hereunder or the

 

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enforcement thereof, and any act which shall defer or delay the operation of any
statute of limitations applicable to the Guarantied Obligations shall similarly
operate to defer or delay the operation of such statute of limitations
applicable to Guarantor’s liability hereunder.

(i) Guarantor hereby waives any right of subrogation Guarantor has or may have
as against Borrower with respect to the Guarantied Obligations; (ii) in
addition, Guarantor hereby waives any right to proceed against Borrower or any
other Person, now or hereafter, for contribution, indemnity, reimbursement, or
any other suretyship rights and claims (irrespective of whether direct or
indirect, liquidated or contingent), with respect to the Guarantied Obligations;
and (iii) also waives any right to proceed or to seek recourse against or with
respect to any property or asset of Borrower.

If any of the Guarantied Obligations or the obligations of Guarantor under this
Guaranty at any time are secured by a mortgage or deed of trust upon real
property, Lender may elect, in its sole discretion, upon a default with respect
to the Guarantied Obligations or the obligations of Guarantor under this
Guaranty, to foreclose such mortgage or deed of trust judicially or
nonjudicially in any manner permitted by law, before or after enforcing this
Guaranty, without diminishing or affecting the liability of Guarantor hereunder.
Guarantor understands that (a) by virtue of the operation of California’s (or
any similar laws of any other jurisdiction) antideficiency law applicable to
nonjudicial foreclosures, an election by Lender to nonjudicially foreclose such
a mortgage or deed of trust probably would have the effect of impairing or
destroying rights of subrogation, reimbursement, contribution, or indemnity of
Guarantor against Borrower or other guarantors or sureties, and (b) absent the
waiver given by Guarantor herein, such an election would estop Lender from
enforcing this Guaranty against Guarantor. Understanding the foregoing, and
understanding that Guarantor is hereby relinquishing a defense to the
enforceability of this Guaranty, Guarantor hereby waives any right to assert
against Lender any defense to the enforcement of this Guaranty, whether
denominated “estoppel” or otherwise, based on or arising from an election by
Lender to nonjudicially foreclose on any such mortgage or deed of trust.
Guarantor understands that the effect of the foregoing waiver may be that
Guarantor may have liability hereunder for amounts with respect to which
Guarantor may be left without rights of subrogation, reimbursement,
contribution, or indemnity against Borrower or other guarantors or sureties.
Guarantor also agrees that the “fair market value” provisions of Section 580a of
the California Code of Civil Procedure (and any similar law of New York or any
other applicable jurisdiction) shall have no applicability with respect to the
determination of Guarantor’s liability under this Guaranty.

Without limiting the generality of any other waiver or other provision set forth
in this Guaranty, Guarantor waives all rights and defenses that Guarantor may
have if all or part of the Guarantied Obligations are secured by real property.
This means, among other things:

(i) Lender may collect from Guarantor without first foreclosing on any real or
personal property collateral that may be pledged by Guarantor, Borrower, or any
other guarantor.

 

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(ii) If Lender forecloses on any real property collateral that may be pledged by
Guarantor, Borrower or any other guarantor:

(1) the amount of the Guarantied Obligations or any obligations of any guarantor
in respect thereof may be reduced only by the price for which that collateral is
sold at the foreclosure sale, even if the collateral is worth more than the sale
price.

(2) Lender may collect from Guarantor even if Lender, by foreclosing on the real
property collateral, has destroyed any right Guarantor may have to collect from
Borrower or any other guarantor.

This is an unconditional and irrevocable waiver of any rights and defenses
Guarantor may have if all or part of the Guarantied Obligations are secured by
real property. These rights and defenses are based upon Section 580a, 580b,
580d, or 726 of the California Code of Civil Procedure and any similar law of
New York or of any other jurisdiction.

WITHOUT LIMITING THE GENERALITY OF ANY OTHER WAIVER OR OTHER PROVISION SET FORTH
IN THIS GUARANTY, GUARANTOR HEREBY WAIVES, TO THE MAXIMUM EXTENT SUCH WAIVER IS
PERMITTED BY LAW, ANY AND ALL BENEFITS OR DEFENSES ARISING DIRECTLY OR
INDIRECTLY UNDER ANY ONE OR MORE OF CALIFORNIA CIVIL CODE §§ 2787, 2799, 2808,
2815, 2819, 2820, 2821, 2822, 2838, 2839, 2847, 2848, AND 2855, CALIFORNIA CODE
OF CIVIL PROCEDURE §§ 580A, 580B, 580C, 580D, AND 726, AND CHAPTER 2 OF TITLE 14
OF THE CALIFORNIA CIVIL CODE OR ANY SIMILAR LAWS OF ANY OTHER APPLICABLE
JURISDICTION.

WITHOUT LIMITING THE GENERALITY OF ANY OTHER WAIVER OR OTHER PROVISION SET FORTH
IN THIS GUARANTY, GUARANTOR WAIVES ALL RIGHTS AND DEFENSES ARISING OUT OF AN
ELECTION OF REMEDIES BY LENDER, EVEN THOUGH SUCH ELECTION OF REMEDIES, SUCH AS A
NONJUDICIAL FORECLOSURE WITH RESPECT TO SECURITY FOR THE GUARANTIED OBLIGATIONS,
HAS DESTROYED GUARANTOR’S RIGHTS OF SUBROGATION AND REIMBURSEMENT AGAINST
BORROWER BY THE OPERATION OF APPLICABLE LAW INCLUDING §580D OF THE CALIFORNIA
CODE OF CIVIL PROCEDURE OR ANY SIMILAR LAWS OF ANY OTHER APPLICABLE
JURISDICTION.

Without limiting the generality any other waiver or other provision set forth in
this Guaranty, Guarantor hereby also agrees to the following waivers:

(1) Guarantor agrees that Lender’s right to enforce this Guaranty is absolute
and is not contingent upon the genuineness, validity or enforceability of the
Guarantied Obligations or this Guaranty, the Note Agreement or the Note.
Guarantor waives all benefits and defenses it may have under California Civil
Code Section 2810 or any similar laws in any

 

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other applicable jurisdiction and agrees that Lender’s rights under this
Guaranty shall be enforceable even if Borrower had no liability at the time of
execution of the Note Agreement or the Note or the Guarantied Obligations are
unenforceable in whole or in part, or Borrower ceases to be liable with respect
to all or any portion of the Guarantied Obligations.

(2) Guarantor waives all benefits and defenses it may have under California
Civil Code Section 2809 or any similar laws in any other applicable jurisdiction
with respect to its obligations under this Guaranty and agrees that Lender’s
rights under this Guaranty, the Note Agreement and the Note will remain
enforceable even if the amount obligated by the Note is larger in amount and
more burdensome than that for which Borrower is responsible. The enforceability
of this Guaranty against Guarantor shall continue until all sums due under the
Note have been paid in full.

(3) Guarantor waives all benefits and defenses it may have under California
Civil Code §§ 2845, 2849 and 2850 or any similar laws of any other applicable
jurisdiction with respect to its obligations under this Guaranty, including the
right to require Lender to (A) proceed against Borrower, any guarantor of
Borrower’s obligations under the Note Agreement or the Note, any other pledgor
of collateral for any person’s obligations to Lender or any other person in
connection with the Guarantied Obligations, (B) proceed against or exhaust any
other security or collateral Lender may hold, or (C) pursue any other right or
remedy for Guarantor’s benefit, and agrees that Lender may exercise its right
under this Guaranty without taking any action against Borrower, any other
guarantor of Borrower’s obligations under the Note Agreement or the Note, any
pledgor of collateral for any person’s obligations to Lender or any other person
in connection with the Guarantied Obligations, and without proceeding against or
exhausting any security or collateral Lender holds.

(4) The paragraphs in this Section 6 which refer to certain sections of the
California Civil Code are included in this Guaranty solely out of an abundance
of caution and shall not be construed to mean that any of the above-referenced
provisions of California law are in any way applicable to this Guaranty.

Releases. Guarantor consents and agrees that, without notice to or by Guarantor
and without affecting or impairing the obligations of Guarantor hereunder,
Lender may, by action or inaction, compromise or settle, shorten or extend the
Scheduled Maturity Date or any other period of duration or the time for the
payment of the Indebtedness, or discharge the performance of the Indebtedness,
or may refuse to enforce the Indebtedness, or otherwise elect not to enforce the
Indebtedness, or may, by action or inaction, release all or any one or more
parties to, any one or more of the terms and provisions of the Note Agreement or
the Note or may grant other indulgences to Borrower or any other guarantor in
respect thereof, or

 

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may amend or modify in any manner and at any time (or from time to time) any one
or more of the Indebtedness, the Note Agreement or the Note (including any
increase or decrease in the principal amount of any Indebtedness or the
interest, fees or other amounts that may accrue from time to time in respect
thereof), or may, by action or inaction, release or substitute the Borrower or
any guarantor, if any, of the Guarantied Obligations, or may enforce, exchange,
release, or waive, by action or inaction, any security for the Guarantied
Obligations or any other guaranty of the Guarantied Obligations, or any portion
thereof

No Election. Lender shall have the right to seek recourse against Guarantor to
the fullest extent provided for herein and no election by Lender to proceed in
one form of action or proceeding, or against any party, or on any obligation,
shall constitute a waiver of Lender’s right to proceed in any other form of
action or proceeding or against other parties unless Lender has expressly waived
such right in writing. Specifically, but without limiting the generality of the
foregoing, no action or proceeding by Lender under any document or instrument
evidencing the Guarantied Obligations shall serve to diminish the liability of
Guarantor under this Guaranty except to the extent that Lender finally and
unconditionally shall have realized indefeasible payment in full of the
Guarantied Obligations by such action or proceeding.

Revival and Reinstatement. If the incurrence or payment of the Guarantied
Obligations or the obligations of Guarantor under this Guaranty by Guarantor or
the transfer by Guarantor to Lender of any property of Guarantor should for any
reason subsequently be declared to be void or voidable under any state or
federal law relating to creditors’ rights, including provisions of the
Bankruptcy Code relating to fraudulent conveyances, preferences, and other
voidable or recoverable payments of money or transfers of property
(collectively, a “Voidable Transfer”), and if Lender is required to repay or
restore, in whole or in part, any such Voidable Transfer, or elects to do so
upon the reasonable advice of its counsel, then, as to any such Voidable
Transfer, or the amount thereof that Lender is required or elects to repay or
restore, and as to all reasonable costs, expenses, and attorneys’ fees of Lender
related thereto, the liability of Guarantor automatically shall be revived,
reinstated, and restored and shall exist as though such Voidable Transfer had
never been made.

Financial Condition of Borrower. Guarantor represents and warrants to Lender
that it is currently informed of the financial condition of Borrower and of all
other circumstances which a diligent inquiry would reveal and which bear upon
the risk of nonpayment of the Guarantied Obligations. Guarantor further
represents and warrants to Lender that it has read and understands the terms and
conditions of the Note Agreement and the Note. Guarantor hereby covenants that
it will continue to keep itself informed of Borrower’s financial condition, the
financial condition of other guarantors, if any, and of all other circumstances
which bear upon the risk of nonpayment or nonperformance of the Guarantied
Obligations.

Payments; Application. All payments to be made hereunder by Guarantor shall be
made in Dollars, in immediately available funds, and without deduction (whether
for taxes or otherwise) or offset and shall be applied in accordance with the
terms of the Note Agreement.

 

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Attorneys Fees and Costs. Guarantor agrees to pay, on demand, all attorneys fees
and all other costs and expenses which may be incurred by Lender in connection
with the enforcement of this Guaranty or in any way arising out of, or
consequential to, the protection, assertion, or enforcement of the Guarantied
Obligations (or any security therefor), irrespective of whether suit is brought.

Notices. All notices and other communications hereunder to Lender shall be in
writing and shall be mailed, sent or delivered in accordance with Exhibit 9.3 of
the Credit Agreement. All notices and other communications hereunder to
Guarantor shall be in writing and shall be mailed, sent or delivered in
accordance with Exhibit 9.3 of the Credit Agreement.

Cumulative Remedies. No remedy under this Guaranty, under the Note Agreement, or
any Loan Document (as such term is defined in the Credit Agreement) is intended
to be exclusive of any other remedy, but each and every remedy shall be
cumulative and in addition to any and every other remedy given under this
Guaranty, under the Note Agreement, or any Loan Document (as such term is
defined in the Credit Agreement), and those provided by law. No delay or
omission by Lender to exercise any right under this Guaranty shall impair any
such right nor be construed to be a waiver thereof. No failure on the part of
Lender to exercise, and no delay in exercising, any right under this Guaranty
shall operate as a waiver thereof; nor shall any single or partial exercise of
any right under this Guaranty preclude any other or further exercise thereof or
the exercise of any other right.

Severability of Provisions. Each provision of this Guaranty shall be severable
from every other provision of this Guaranty for the purpose of determining the
legal enforceability of any specific provision.

Entire Agreement; Amendments. This Guaranty constitutes the entire agreement
between the Guarantor and Lender pertaining to the subject matter contained
herein. This Guaranty may not be altered, amended, or modified, nor may any
provision hereof be waived or noncompliance therewith consented to, except by
means of a writing executed by Guarantor and Lender. Any such alteration,
amendment, modification, waiver, or consent shall be effective only to the
extent specified therein and for the specific purpose for which given. No course
of dealing and no delay or waiver of any right or default under this Guaranty
shall be deemed a waiver of any other, similar or dissimilar, right or default
or otherwise prejudice the rights and remedies hereunder.

Successors and Assigns. This Guaranty shall be binding upon Guarantor and its
successors and assigns and shall inure to the benefit of the successors and
assigns of Lender; provided, however, Guarantor shall not assign this Guaranty
or delegate any of its duties hereunder without Lender’s prior written consent
and any unconsented to assignment shall be absolutely null and void. In the
event of any assignment, participation, or other transfer of rights by Lender,
the rights and benefits herein conferred upon Lender shall automatically extend
to and be vested in such assignee or other transferee.

 

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No Third Party Beneficiary. This Guaranty is solely for the benefit of Lender
and each of its successors and assigns and may not be relied on by any other
Person.

CHOICE OF LAW AND VENUE; JURY TRIAL WAIVER.

THE VALIDITY OF THIS GUARANTY, THE CONSTRUCTION, INTERPRETATION, AND ENFORCEMENT
HEREOF, AND THE RIGHTS OF THE PARTIES HERETO WITH RESPECT TO ALL MATTERS ARISING
HEREUNDER OR RELATED HERETO SHALL BE DETERMINED UNDER, GOVERNED BY, AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF CALIFORNIA.

THE PARTIES AGREE THAT ALL ACTIONS OR PROCEEDINGS ARISING IN CONNECTION WITH
THIS GUARANTY SHALL BE TRIED AND LITIGATED ONLY IN THE STATE AND, TO THE EXTENT
PERMITTED BY APPLICABLE LAW, FEDERAL COURTS LOCATED IN THE COUNTY OF LOS
ANGELES, STATE OF CALIFORNIA; PROVIDED, HOWEVER, THAT ANY SUIT SEEKING
ENFORCEMENT AGAINST ANY COLLATERAL OR OTHER PROPERTY MAY BE BROUGHT, AT LENDER’S
OPTION, IN THE COURTS OF ANY JURISDICTION WHERE LENDER ELECTS TO BRING SUCH
ACTION OR WHERE SUCH COLLATERAL OR OTHER PROPERTY MAY BE FOUND. GUARANTOR AND
LENDER WAIVE, TO THE EXTENT PERMITTED UNDER APPLICABLE LAW, ANY RIGHT EACH MAY
HAVE TO ASSERT THE DOCTRINE OF FORUM NON CONVENIENS OR TO OBJECT TO VENUE TO THE
EXTENT ANY PROCEEDING IS BROUGHT IN ACCORDANCE WITH THIS SECTION 19.

GUARANTOR AND LENDER HEREBY WAIVE THEIR RESPECTIVE RIGHTS TO A JURY TRIAL OF ANY
CLAIM OR CAUSE OF ACTION BASED UPON OR ARISING OUT OF THIS GUARANTY OR ANY OF
THE TRANSACTIONS CONTEMPLATED HEREIN, INCLUDING CONTRACT CLAIMS, TORT CLAIMS,
BREACH OF DUTY CLAIMS, AND ALL OTHER COMMON LAW OR STATUTORY CLAIMS. GUARANTOR
AND LENDER REPRESENT THAT EACH HAS REVIEWED THIS WAIVER AND EACH KNOWINGLY AND
VOLUNTARILY WAIVES ITS JURY TRIAL RIGHTS FOLLOWING CONSULTATION WITH LEGAL
COUNSEL. IN THE EVENT OF LITIGATION, A COPY OF THIS SECTION MAY BE FILED AS A
WRITTEN CONSENT TO A TRIAL BY THE COURT.

Counterparts; Telefacsimile Execution. This Guaranty may be executed in any
number of counterparts and by different parties on separate counterparts, each
of which, when executed and delivered, shall be deemed to be an original, and
all of which, when taken together, shall constitute but one and the same
Guaranty. Delivery of an executed counterpart of this Guaranty by telefacsimile
or electronic mail shall be equally as effective as delivery of an original
executed counterpart of this Guaranty. Any party delivering an

 

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executed counterpart of this Guaranty by telefacsimile or electronic mail also
shall deliver an original executed counterpart of this Guaranty but the failure
to deliver an original executed counterpart shall not affect the validity,
enforceability, and binding effect of this Guaranty.

Agreement to be Bound. Guarantor hereby agrees to be bound by each and all of
the terms and provisions of the Note Agreement applicable to Guarantor. Without
limiting the generality of the foregoing, by its execution and delivery of this
Guaranty, Guarantor hereby: (a) makes to Lender each of the representations and
warranties set forth in the Note Agreement applicable to Guarantor fully as
though Guarantor were a party thereto, and such representations and warranties
are incorporated herein by this reference, mutatis mutandis; and (b) agrees and
covenants (i) to do each of the things set forth in the Note Agreement that
Borrower agrees to do and covenants to cause Guarantor to do, and (ii) to not do
each of the things set forth in the Note Agreement that Borrower agrees and
covenants to cause Guarantor not to do, in each case, fully as though Guarantor
was a party thereto, and such agreements and covenants are incorporated herein
by this reference, mutatis mutandis.

[signature page follows]

 

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IN WITNESS WHEREOF, the undersigned has executed and delivered this Guaranty as
of the date first written above.

 

JMP GROUP LLC, a Delaware limited liability company By:  

/s/ Joseph A. Jolson

Title:   Chief Executive Officer

[SIGNATURE PAGE TO GUARANTY]

 

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AMENDMENT NUMBER ONE TO GENERAL CONTINUING GUARANTY

This AMENDMENT NUMBER ONE TO GENERAL CONTINUING GUARANTY (this “Amendment”),
dated as of April 8, 2011 is entered into by and between HARVEST CAPITAL
STRATEGIES LLC, a Delaware limited liability company (“Guarantor”), and CITY
NATIONAL BANK, a national banking association (“Lender”), and in light of the
following:

W I T N E S S E T H

WHEREAS, JMP GROUP LLC, a Delaware limited liability company (“Borrower”) and
Lender are party to that certain Credit Agreement, dated as of August 3, 2006
(as amended, restated, supplemented, or otherwise modified from time to time,
the “Credit Agreement”);

WHEREAS, Guarantor executed and delivered that certain Guaranty in favor of
Lender, dated as of August 3, 2006 (as amended, restated, supplemented, or
otherwise modified from time to time, the “Guaranty”), respecting the
obligations of Borrower owing to Lender under the Credit Agreement;

WHEREAS, in connection with the execution and delivery of Amendment Number Five
to Credit Agreement dated contemporaneously herewith by and between Borrower and
Lender, Guarantor has requested that Lender amend the Guaranty as set forth
herein; and

WHEREAS, subject to the terms and conditions set forth herein, Lender is willing
to provide the amendment requested by Guarantors.

NOW, THEREFORE, in consideration of the foregoing and the mutual covenants
herein contained, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties hereby agree as
follows:

1. Defined Terms. Capitalized terms used herein and not otherwise defined herein
shall have the meanings ascribed to them in the Credit Agreement, as amended
hereby.

2. Amendments to Guaranty.

(a) Section 1 of the Guaranty is hereby amended by inserting or amending and
restating, as applicable, the following definitions in their entireties:

““Broker/Dealer” means Jolson Merchant Partners, LLC, a Delaware limited
liability company.”

““Broker/Dealer Guarantied Obligations” means the Debt now or hereafter
outstanding under the Note Agreement and the Note, whether for principal,
interest (including all interest that accrues after the commencement of any
Insolvency Proceeding irrespective of whether a claim therefor is allowed in
such case or proceeding), fees, expenses or otherwise, and any and all expenses
(including reasonable counsel fees and expenses) incurred by Lender in enforcing
any rights under the Note Agreement and the Note. Without limiting the
generality of

 

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the foregoing, Broker/Dealer Guarantied Obligations shall include all amounts
that constitute part of the Broker/Dealer Guarantied Obligations and would be
owed by Broker/Dealer to Lender under the Note Agreement and the Note, but for
the fact that they are unenforceable or not allowable due to the existence of a
bankruptcy, reorganization or similar proceeding involving Broker/Dealer or any
other guarantor.””

““Guarantied Obligations” means (a) the Broker/Dealer Guarantied Obligations now
or hereafter outstanding, and (b) the due and punctual payment of the
Indebtedness incurred by Borrower in favor of Lender pursuant to the terms of
the Credit Agreement and the other Loan Documents, in each case whether for the
principal of, and interest on, and any and all fees, costs, indemnities and
expenses (including any portion of any of the foregoing that accrues after the
commencement of an Insolvency Proceeding, whether or not allowed or allowable in
whole or in part as a claim in any such Insolvency Proceeding) incurred in
connection with or on the Broker/Dealer Guarantied Obligations or the Credit
Agreement and the other Loan Documents.”

““Note” means that certain Revolving Note, dated as of April 8, 2011, between
Broker/Dealer and Lender.”

““Note Agreement” means that certain Revolving Note and Cash Subordination
Agreement, dated as of April 8, 2011 (as amended, restated, supplemented or
otherwise modified from time to time), by and between Broker/Dealer and Lender.”

3. Representations and Warranties. Guarantor hereby represents and warrants to
Lender as follows:

(a) It has the requisite power and authority to execute and deliver this
Amendment and to perform its obligations hereunder and under the Loan Documents
to which it is a party. The execution, delivery, and performance by it of this
Amendment and the performance by it of each Loan Document to which it is a party
(i) have been duly approved by all necessary action and no other proceedings are
necessary to consummate such transactions; and (ii) are not in contravention of
(A) any law, rule, or regulation, or any order, judgment, decree, writ,
injunction, or award of any arbitrator, court or governmental authority binding
on it, (B) the terms of its organizational documents, or (C) any provision of
any contract or undertaking to which it is a party or by which any of its
properties may be bound or affected;

(b) This Amendment has been duly executed and delivered by Guarantor. This
Amendment and each Loan Document to which Guarantor is a party is the legal,
valid and binding obligation of Guarantor, enforceable against Guarantor in
accordance with its terms, and is in full force and effect except as such
validity and enforceability is limited by the laws of insolvency and bankruptcy,
laws affecting creditors’ rights and principles of equity applicable hereto;

(c) No injunction, writ, restraining order, or other order of any nature
prohibiting, directly or indirectly, the consummation of the transactions
contemplated herein has been issued and remains in force by any Governmental
Authority against Guarantor or Lender;

 

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(d) No Default or Event of Default has occurred and is continuing on the date
hereof or as of the date of the effectiveness of this Amendment after giving
effect to this Amendment; and

(e) The representations and warranties in the Guaranty and the other Loan
Documents are true and correct in all respects on and as of the date hereof, as
though made on such date (except to the extent that such representations and
warranties relate solely to an earlier date).

4. Choice of Law. This Amendment and the rights of the parties hereunder, shall
be governed by, and construed in accordance with, the laws of the State of
California applicable to contracts made and to be performed in the State of
California.

5. Entire Agreement. This Amendment, and terms and provisions hereof, constitute
the entire agreement among the parties pertaining to the subject matter hereof
and supersedes any and all prior or contemporaneous amendments relating to the
subject matter hereof. Except for the amendments to the Guaranty expressly set
forth in Section 2 hereof, the Guaranty shall remain unchanged and in full force
and effect. Except as expressly set forth herein, the execution, delivery, and
performance of this Amendment shall not operate as a waiver of or as an
amendment of any right, power, or remedy of Lender as in effect prior to the
date hereof. The amendments set forth herein are limited to the specifics
hereof, shall not apply with respect to any facts or occurrences other than
those on which the same are based, shall not excuse future non-compliance with
the Guaranty, and shall not operate as a consent to any further or other matter,
under the Guaranty. To the extent any terms or provisions of this Amendment
conflict with those of the Guaranty, the terms and provisions of this Amendment
shall control. This Amendment is a Loan Document.

6. Counterparts; Telefacsimile Execution. This Amendment may be executed in any
number of counterparts, all of which taken together shall constitute one and the
same instrument and any of the parties hereto may execute this Amendment by
signing any such counterpart. Delivery of an executed counterpart of this
Amendment by telefacsimile shall be equally as effective as delivery of an
original executed counterpart of this Amendment. Any party delivering an
executed counterpart of this Amendment by telefacsimile also shall deliver an
original executed counterpart of this Amendment, but the failure to deliver an
original executed counterpart shall not affect the validity, enforceability, and
binding effect of this Amendment.

7. Miscellaneous. Upon and after the effectiveness of this Amendment, each
reference in the Guaranty to “this Agreement”, “hereunder”, “herein”, “hereof”
or words of like import referring to the Guaranty, and each reference in the
other Loan Documents to “the Guaranty”, “thereunder”, “therein”, “thereof” or
words of like import referring to the Guaranty, shall mean and be a reference to
the Guaranty as modified and amended hereby.

 

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IN WITNESS WHEREOF, the parties have entered into this Amendment as of the date
first above written.

 

HARVEST CAPITAL STRATEGIES LLC, a Delaware limited liability company, as
Guarantor

By:

 

/s/ Joseph A. Jolson

Title:   Chief Executive Officer

[SIGNATURE PAGE TO AMENDMENT NUMBER ONE TO GUARANTY]

 

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CITY NATIONAL BANK, a national banking association, as Lender

By:

 

/s/ Garen Papazyan

Title:   Vice President

[SIGNATURE PAGE TO AMENDMENT NUMBER ONE TO GUARANTY]

 

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