GUARANTY AGREEMENT
                               ------------------

     THIS GUARANTY AGREEMENT  ("Guaranty"),  dated January 14, 1999, is made and
entered into upon the terms hereinafter set forth, by HARVEST  RESTAURANT GROUP,
INC., a Texas corporation ("Guarantor"), in favor of SIRROM CAPITAL CORPORATION,
a Tennessee corporation ("Lender").


                                    RECITALS:
                                    ---------

     WHEREAS,  pursuant  to a Loan  Agreement  dated  October 22,  1996,  by and
between TRC Acquisition  Corporation,  a Georgia  corporation ("TRC") and Lender
(the "Loan Agreement"),  Lender has made a loan to TRC in the original principal
amount of $2,000,000 (the "Loan");

     WHEREAS,  the  Loan  is  evidenced  by  an  Amended  and  Restated  Secured
Promissory Note of even date herewith,  in the Loan amount, made and executed by
Hartan,  Inc.,  a Texas  corporation  ("Hartan")  payable to the order of Lender
(herein  referred to,  together  with any  extensions,  modifications,  renewals
and/or replacements thereof, as the "Note");

     WHEREAS,  pursuant  to an  Assumption  Agreement  and  Consent of even date
herewith  Hartan  is  assuming  all of the  obligations  of TRC  under  the Loan
Documents (as defined in the Loan Agreement);

     WHEREAS,  on or before the date hereof, TRC will merge with and into Hartan
pursuant to the terms and  conditions  of an Amended and Restated  Agreement and
Plan of Merger by and among Harvest  Restaurant Group, Inc., Hartan and TRC (the
"Merger");

     WHEREAS,  it is a condition of Lender's  agreement to consent to the Merger
that Guarantor execute and deliver this Guaranty to Lender; and

     WHEREAS,  Guarantor  desires to execute and deliver this Guaranty to Lender
in order to induce Lender to consent to the Merger,  which will be to the direct
interest, advantage and benefit of Guarantor, who is the parent of Hartan.


                                   AGREEMENT:
                                   ----------

     NOW,  THEREFORE,  in  consideration  of the  foregoing  and other  good and
valuable  consideration,  the  receipt  and  sufficiency  of  which  are  hereby
acknowledged,  and to induce Lender to consent to the Merger,  Guarantor  hereby
agrees as follows:

     1.  Guarantor  hereby  guarantees to Lender the full and prompt payment and
performance of (a) the indebtedness  evidenced by the Amended and Restated Note,
principal  and  any and all  interest  accrued  or to  accrue  thereon,  (b) the
obligations  of Hartan to Lender  pursuant to the Amended and Restated Note, the
Loan Agreement and any and all other  instruments,  documents and/or  agreements
now or  hereafter  further  evidencing,  securing  or  otherwise  related to the
indebtedness  evidenced by the Amended and Restated Note (collectively the "Loan

<PAGE>


Documents") and (c) any and all other  indebtednesses  and other  obligations of
Hartan to Lender, direct or contingent (including but not limited to obligations
incurred as indorser,  guarantor or surety),  however  evidenced or denominated,
and however and whenever  incurred,  including but not limited to indebtednesses
incurred  pursuant to any present or future  commitment of Lender to Hartan (the
aforesaid  indebtedness and other obligations are sometimes herein  collectively
referred to as the "Guaranteed  Obligations").  Guarantor  hereby agrees that if
the Guaranteed Obligations are not timely paid and/or performed, as the case may
be, in accordance with the terms thereof,  Guarantor immediately will pay and/or
perform such Guaranteed Obligations. If for any reason any payment or obligation
in respect of the Guaranteed Obligations shall be determined at any time to be a
voidable  preference or otherwise  shall be set aside or required to be returned
or repaid, this Guaranty  nevertheless shall remain in full force and effect and
shall be fully  enforceable  against Guarantor for the payment or obligation set
aside,  returned or repaid,  as well as any other Guaranteed  Obligations  still
outstanding,   notwithstanding  the  fact  that  this  Guaranty  may  have  been
cancelled, released and/or returned to Guarantor by Lender.

     2. In  addition  to the  obligations  of  Guarantor  to Lender  pursuant to
Section  1  hereof,  Guarantor  further  agrees  to pay  any  and  all  expenses
(including without limitation  attorneys' fees) reasonably incurred by Lender in
endeavoring to collect and/or  enforce the  obligations of Guarantor  under this
Guaranty.

     3. Guarantor  shall furnish to Lender (a) as soon as practicable and in any
event within one hundred  twenty (120) days after the end of each fiscal year of
Guarantor,  an audited balance sheet of Guarantor as of the close of such fiscal
year,  an audited  statement of  operations of Guarantor as of the close of such
fiscal year and an audited statement of cash flows for Guarantor for such fiscal
year,  prepared in accordance  with  generally  accepted  accounting  principles
consistently  applied and accompanied by an unqualified audit report prepared by
an  independent  certified  public  accountant  acceptable to Lender showing the
financial  condition  of  Guarantor  at the  close of such  fiscal  year and the
results of its  operations  during such  fiscal year and (b) within  thirty (30)
days of the end of each calendar month, a status report indicating the financial
performance  of  Guarantor  during  such  month and the  financial  position  of
Guarantor as of the end of such month in the same format  required by Lender for
Hartan under the Loan Agreement.

     4. Guarantor  hereby waives notice of any breach or default by Hartan,  and
hereby further waives presentment,  demand,  notice of dishonor and protest with
respect to any  instrument  now or hereafter  evidencing  any of the  Guaranteed
Obligations.

     5. Any act of Lender consisting of a waiver of any of the terms,  covenants
or conditions of the Guaranteed Obligations, or the giving of any consent to any
matter or thing relating to the Guaranteed  Obligations,  or the granting of any
indulgences  or  extensions  of time to Hartan,  may be done  without  notice to
Guarantor and without releasing the obligations of Guarantor hereunder.

     6. The obligations of Guarantor hereunder shall not be released by Lender's
receipt,  application  or  release  of  any  security  given  for  the  payment,
performance and observance of any of the Guaranteed Obligations.  Similarly, the
obligations of Guarantor  hereunder shall not be released by any modification of
any of the terms of the Guaranteed Obligations made by Lender and Hartan, but in
the case of any such  modification,  the liability of Guarantor  shall be deemed
modified in accordance with the terms of any such modification.

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<PAGE>


     7. The liability of Guarantor  hereunder shall in no way be affected by (a)
the release or discharge of Hartan in any creditors' receivership, bankruptcy or
other  proceedings,  (b)  the  impairment,  limitation  or  modification  of the
liability of Hartan or the estate of Hartan in bankruptcy,  or of any remedy for
the  enforcement  of  any of  the  Guaranteed  Obligations  resulting  from  the
operation of any present or future  provision of the Federal  bankruptcy  law or
any  other  statute  or  the  decision  of  any  court,  (c)  the  rejection  or
disaffirmance  of any  instrument,  document or agreement  evidencing any of the
Guaranteed  Obligations in any such proceedings,  (d) the assignment or transfer
of any of the Guaranteed  Obligations by Lender, (e) the death or any disability
or other defense of Hartan,  or (f) the cessation  from any cause  whatsoever of
the liability of Hartan with respect to the Guaranteed Obligations.

     8. Until all of the covenants,  terms and conditions of Hartan with respect
to the Guaranteed  Obligations are fully paid, performed,  kept and/or observed,
Guarantor,  (a) shall have no rights of  reimbursement  or  subrogation  against
Hartan or any of its property by reason of any payment or acts of performance by
Guarantor in compliance with the obligations of Guarantor hereunder,  (b) waives
any right to enforce  any remedy  that  Guarantor  now or  hereafter  shall have
against  Hartan by reason of any one or more payments or acts of  performance in
compliance with the obligations of Guarantor hereunder, and (c) subordinates any
liability or  indebtedness  of Hartan now or hereafter  held by Guarantor to the
obligations of Hartan to Lender under the Guaranteed Obligations.

     9. This is a guaranty of payment and performance and not of collection. The
liability  of  Guarantor  hereunder  shall  be  direct  and  immediate  and  not
conditional or contingent upon the pursuit of any remedies against Hartan or any
other person, nor against any collateral  available to Lender.  Guarantor hereby
waives any right to  require  that an action be  brought  against  Hartan or any
other  person or to require  that  resort be had to any  collateral  in favor of
Lender prior to discharging its obligations hereunder.  Guarantor further waives
any right of Guarantor to require that an action be brought against Hartan under
the provisions of Title 47, Chapter 12,  Tennessee Code  Annotated,  as the same
may be amended from time to time.

     10.  Guarantor  hereby  consents  and agrees that all  payments and credits
received from Hartan or Guarantor or realized from any collateral may be applied
by Lender to the  Guaranteed  Obligations in such priority as Lender in its sole
judgment shall see fit.

     11. In the event that Guarantor consists of more than one person or entity,
the  obligations  of Guarantor  hereunder  shall be joint and  several,  and all
references herein to "Guarantor" shall refer to each of said persons or entities
jointly and severally. This Guaranty is assignable by Lender, and any assignment
of the Guaranteed  Obligations or any portion thereof by Lender shall operate to
vest in the assignee the rights and powers of Lender  hereunder to the extent of
such  assignment.  This Guaranty shall be binding upon Guarantor and Guarantor's
heirs, representatives,  successors,  successors-in-title and assigns, and shall
inure to the benefit of Lender, its successors, successors-in-title and assigns.

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<PAGE>


     12. This Guaranty shall be construed in accordance with and governed by the
laws of the State of Tennessee  applicable  to contracts to be performed  within
said State.  No amendment  or  modification  hereof  shall be  effective  unless
evidenced by a writing  signed by Guarantor  and Lender.  When used herein,  the
singular  shall  include the plural,  and vice versa,  and the use of any gender
shall include all other genders, as appropriate.

     13.  Guarantor  hereby  waives  notice of  acceptance  of this  Guaranty by
Lender.

     14.  Guarantor  hereby  consents to the  jurisdiction  of the courts of the
State of Tennessee and the United States  District Court for the Middle District
of Tennessee,  as well as to the jurisdiction of all courts from which an appeal
may be taken from such  courts,  for the  purpose  of any suit,  action or other
proceeding arising out of any of its obligations arising under this Agreement or
with respect to the transactions  contemplated  hereby, and expressly waives any
and all objections it may have as to venue in any of such courts.

     15.  LENDER  AND  GUARANTOR  HEREBY  WAIVE  TRIAL  BY JURY IN ANY  ACTIONS,
PROCEEDINGS, CLAIMS OR COUNTER-CLAIMS, WHETHER IN CONTRACT OR TORT, AT LAW OR IN
EQUITY, ARISING OUT OF OR IN ANY WAY RELATING TO THIS AGREEMENT.

     16. This  Guaranty  may be executed  in any number of  counterparts  and by
different parties to this Guaranty in separate counterparts,  each of which when
so executed  shall be deemed to be an original  and all of which taken  together
shall constitute one and the same Guaranty.

     17.  Without  the prior  written  consent  of Lender,  Guarantor  shall not
declare or pay any dividend of any kind (other than stock  dividends  payable to
all holders of any class of capital stock), in cash or in property, on any class
of the capital  stock of  Guarantor,  or purchase,  redeem,  retire or otherwise
acquire for value any shares of such  stock,  nor make any  distribution  of any
kind in cash or property in respect  thereof,  nor make any return of capital of
shareholders,  nor make any payments in cash or property in respect of any stock
options,  stock  bonus or  similar  plan nor grant any  preemptive  rights  with
respect to the capital stock of Guarantor.

     Notwithstanding the foregoing:

          A. So long as (i) the Fixed  Charge  Coverage  Ratio  (as  hereinafter
defined) is 1.1 to 1 or above,  (ii) Guarantor causes Hartan to make a principal
prepayment on the Note equal to the aggregate amount of the dividends being paid
on the Series A Preferred  Stock  simultaneously  with paying such dividends and
(iii) no Event of Default (as defined in the Loan Agreement) has occurred and is
continuing,  Guarantor may pay cash dividends on its Series A Preferred Stock as
set forth in Guarantor's  current Articles of Incorporation;  provided,  however
that no cash  dividend  shall  be paid on the  Series A  Preferred  Stock if the
payment of such dividend would cause the Fixed Charge  Coverage Ratio to be less
than 1.1 to 1. Fixed Charge  Coverage Ratio shall be the quotient of (i) the sum
of net income,  plus  interest  expense,  plus taxes,  plus  depreciation,  plus
amortization,  plus rental payments for leased real estate,  plus lease payments
for capitalized obligations, divided by (ii) the sum of current interest expense
on   indebtedness,   plus  the  amount  of  current   maturities  of  long  term
indebtedness,  plus the amount of rental  payments for leased real estate,  plus
lease payments for capitalized  obligations,  all of the foregoing determined in
accordance with generally accepted accounting principles on a consolidated basis
for the most recent fiscal year end.

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<PAGE>


          B.  So  long  as (i)  Guarantor  causes  Hartan  to  make a  principal
prepayment on the Note equal to the aggregate amount of the dividends being paid
on the Series D Preferred  Stock  simultaneously  with paying such dividends and
(ii) no Event of Default (as defined in the Loan  Agreement) has occurred and is
continuing,  Guarantor may pay cash dividends on its Series D Preferred Stock as
set forth in Guarantor's  Articles of  Incorporation  as amended on or about the
date that the  Articles  and  Certificate  of Merger  relating to the Merger are
filed with the Secretaries of State of Georgia and Texas.

          C.  Guarantor  may pay  dividends in shares of its Common Stock to all
holders  of any  series of its  preferred  stock  pursuant  to the terms of such
series of  preferred  stock;  and issue  shares of its  capital  stock  upon the
conversion  by any holder or  holders  of shares of any series of its  preferred
stock pursuant to the terms of such series of preferred stock.

     IN WITNESS WHEREOF,  the undersigned  Guarantor has executed this Guaranty,
or  has  caused  this   Guaranty   to  be   executed  by  its  duly   authorized
representative, as of the date first above written.

                                        HARVEST RESTAURANT GROUP, INC.


                                        By: /s/ Timothy R. Robinson
                                        Title: VP CFO




ACCEPTED this 23rd day of January, 1999.

SIRROM CAPITAL CORPORATION,
a Tennessee corporation


By: /s/ Elizabeth Lurding
Title: /s/ Vice President


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