Exhibit 10.1

     

    

     

    FIRST
      AMENDMENT TO CREDIT AGREEMENT

     

    This
      First Amendment to Credit Agreement is entered into as of October 31, 2007,
      by
      and between Highbury
      Financial Inc.,
      a
      Delaware corporation (“Borrower”) and City
      National Bank,
      a
      national banking association (“CNB”).

     

    RECITALS

     

    A. Borrower
      and CNB are parties to that certain Credit Agreement, dated as of November
      7,
      2006 (the Credit Agreement, as herein amended, hereinafter the “Credit
      Agreement”).

     

    B. Borrower
      and CNB desire to supplement and amend the Credit Agreement as hereinafter
      set
      forth.

     

    NOW,
      THEREFORE,
      the
      parties agree as follows:

     

    
      	
              1.

            	
              Definitions.
                Capitalized terms used in this Amendment without definition shall
                have the
                meanings set forth in the Credit
                Agreement.

            


    

     

    
      	
              2.

            	
              Amendments.
                The Credit Agreement is amended as
                follows:

            


    

     

    
      	 	
              2.1

            	
              Section
                1.4 (Aston
                Funds)
                is stricken and replaced with the
                following:

            


    

     

    “1.4 “Aston
      Funds”
      means
      the portion of the mutual fund business Borrower acquired from ABN AMRO Asset
      Management Holdings pursuant to an agreement dated April 20, 2006.”

     

    
      	 	
              2.2

            	
              Section
                1.12 (EBITDA)
                is stricken and replaced with the
                following:

            


    

     

    “1.12 “EBITDA”
will
      be
      determined on a consolidated basis for Borrower and means the sum of (a) net
      income of the Borrower determined in accordance with GAAP earned over the twelve
      month period ending on the date of determination, plus (b) amortization of
      intangible assets, plus (c) interest expense, plus (d) depreciation, plus (e)
      other non-cash expenses, and plus (f) taxes, expensed during the twelve month
      period ending on the date of determination. For periods prior to the acquisition
      of the Aston Funds by Borrower, EBITDA for Borrower shall include eighteen
      and
      one fifth percent (18.2%) of the revenue of the Aston Funds, less $50,000.00
      for
      each month prior to acquisition. After the closing of an acquisition, for
      periods prior to such acquisition, EBITDA for Borrower shall include the
      percentage or revenue or profits, as applicable, of the acquisition target
      to
      which Borrower would have been entitled during the periods had the acquisition
      been completed prior to those periods.”

     

    
      
         

      

      
        1

        
          

        

      

      
         

      

    

     

    
      	 	
              2.3

            	
              Section
                1.30 (Termination
                Date)
                is stricken and replaced with the
                following:

            


    

     

    “1.30 “Termination
      Date”
      means
      October 31, 2008. Notwithstanding the foregoing, CNB may, at its option,
      terminate this Agreement pursuant to the Section entitled “CNB’s Remedies”; the
      date of any such termination will become the Termination Date as that term
      is
      used in this Agreement.”

     

    
      	 	
              2.4

            	
              A
                new Section 1.32 (Fixed
                Charges)
                is added to the Credit Agreement to provide as
                follows:

            


    

     

    “1.32 “Fixed
      Charges”
      means
      the sum (without duplication) of (a) the aggregate amount of Current Maturity
      of
      Long-Term Debt (“Current Maturity of Long-Term Debt” means that portion of
      Borrower’s consolidated long-term liabilities, determined in accordance with
      GAAP for borrowed money, which will, by the terms thereof, become due and
      payable within one (1) year following the date of the balance sheet upon which
      such calculations are based.) plus (b) all interest incurred on borrowed money,
      plus (c) provisions for Federal and State income taxes paid or payable, plus
      (d)
      all capital expenditures, with (b), (c) and (d) being determined by reference
      to
      the twelve month period ending on the date of determination. For clarification,
      Fixed Charges will exclude Total Funded Debt, as defined herein.”

     

    
      	 	
              2.5

            	
              A
                new Section 1.33 (Liquid
                Assets)
                is added to the Credit Agreement to provide as
                follows:

            


    

     

    “1.33 “Liquid
      Assets”
      shall
      mean the sum of cash, cash equivalents and marketable securities held in the
      Borrower’s name, excluding (i) any assets upon which there is any security
      interest, lien or encumbrance, and (ii) any securities or accounts which are
      not
      readily convertible into cash (such as restricted stock or hedge
      funds).”

     

    
      	 	
              2.6

            	
              A
                new Section 1.34 (Marketable
                Securities)
                is added to the Credit Agreement to provide as
                follows:

            


    

     

    “1.34 “Marketable
      Securities”
      shall
      mean “margin stock” as defined in Regulation U of the Federal Reserve Board;
      mutual funds; and bonds and other debt securities of United States corporations
      not falling within the definition of “margin stock” with a credit quality rating
      of at least A by Standard & Poors or A-2 by Moody’s; commercial paper with a
      credit quality rating of at least A-2 by Standard & Poors or P-2 by Moody’s;
      obligations issued by or guaranteed by the United States government or agencies
      thereof; and obligations of any state, territory, municipality or other local
      governmental subdivision or entity of the United States, with a credit quality
      rating of at least A by Standard & Poors or A-2 by Moody’s.”

     

    
      
         

      

      
        2

        
          

        

      

      
         

      

    

     

    
      	 	
              2.7

            	
              A
                new Section 1.35 (Total
                Funded Debt)
                is added to the Credit Agreement to provide as
                follows:

            


    

     

    “1.35 “Total
      Funded Debt”
      means,
      as of the end of each fiscal quarter, the amount of the principal balances
      for
      all Loans under this agreement.”

     

    
      	 	
              2.8

            	
              Section
                5.10 (Use
                of Proceeds)
                is stricken and replaced with the
                following:

            


    

     

    “5.10 Use
      of Proceeds.
      Borrower
      will use the proceeds of the Revolving Credit Loans for working capital, general
      corporate purposes, acquisitions or repurchases of Borrower’s outstanding
      securities.”

     

    
      	 	
              2.9

            	
              Section
                6.8 (Financial
                Tests)
                is stricken and replaced with the
                following:

            


    

     

    “6.8 Financial
      Tests.
      Borrower
      will maintain:

     

    “6.8.1 Net
      Worth
      of not less than $20,000,000 at the end of any fiscal quarter;

     

    “6.8.2 A
      ratio
      of Debt, less Liquid Assets, to EBITDA of not more than 5.0 to 1 at the end
      of
      any fiscal quarter;

     

    “6.8.3 A
      ratio
      of Total Funded Debt to EBITDA of not more than 2.00 to 1 at the end of any
      fiscal quarter; and

     

    “6.8.4 A
      ratio
      of EBITDA to Fixed Charges of not less than 1.25 to 1 as of the end of each
      fiscal quarter.”

     

    
      	 	
              2.10

            	
              Section
                7.3 (Loans)
                is stricken and replaced with the
                following:

            


    

     

    “7.3 Loans.
      Make
      loans or advances to any Person except credit extended to Affiliates in any
      amount.”

     

    
      	 	
              2.11

            	
              Section
                7.9 (Mergers
                and Acquisitions)
                is stricken and replaced with the
                following:

            


    

     

    “7.9 Mergers
      and Acquisitions.
      Consummate any merger or consolidation, or acquire all or substantially all
      of
      the assets of any Person, without the prior, written consent of CNB, which
      consent will not be unreasonably withheld.”

     

    
      	
              3.

            	
              Existing
                Agreement.
                Except as expressly amended herein, the Credit Agreement shall remain
                in
                full force and effect, and in all other respects is
                affirmed.

            


    

     

    
      	
              4.

            	
              Conditions
                Precedent.
                This Amendment shall become effective upon the fulfillment of all
                of the
                following conditions to CNB’s
                satisfaction:

            


    

     

    
      	 	
              4.1

            	
              CNB
                shall have received this Amendment duly executed by
                Borrower.

            


    

     

    
      
         

      

      
        3

        
          

        

      

      
         

      

    

     

    
      	5.	
              Counterparts.
                This Amendment may be executed in any number of counterparts, and
                all such
                counterparts taken together shall be deemed to constitute one and
                the same
                instrument.

            


      	 	 


      	
              6.

            	
              Governing
                Law.
                This Amendment and the rights and obligations of the parties hereto
                shall
                be construed in accordance with, and governed by the laws of the
                State of
                California.

            


    

     

    IN
      WITNESS WHEREOF, the
      parties have executed this Amendment as of the day and year first above
      written.

    
      	 	 	 
	
              “Borrower” 

            	
              Highbury
                Financial Inc.,
                a

              Delaware corporation

            
	 
 	 
 	 
 
	
            	By:  	/s/
              Richard Foote
	 	
              

              Richard
                Foote, Chief Executive Officer

            


    

     

    
      	 	 	 
	“CNB”	
              City
                National Bank,
                a

              national banking association

            
	 
 	 
 	 
 
	
            	By:  	/s/
              Aaron Cohen
	 	
              

              Aaron
                Cohen, Senior Vice President

            


    

     

    
      
         

      

      
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