<PAGE>

                                                                   Exhibit 10.49

                                    GUARANTY
                                    --------

                          DATED as of February 20, 2002



                                       by


                         MEDALLION FUNDING CHICAGO CORP.


                                   in favor of


       FLEET NATIONAL BANK, as Agent for itself and the Banks named herein



                                       and


                                    THE BANKS





<PAGE>


                                TABLE OF CONTENTS
                                -----------------

<TABLE>
<S>                                                                                  <C>
1.   Definitions.....................................................................  1
     -----------
2.   Guaranty of Payment and Performance.............................................  1
     -----------------------------------
3.   Intercreditor Agreement ........................................................  2
     -----------------------
4.   Guarantor's Agreement to Pay Enforcement Costs, etc.............................  2
     ---------------------------------------------------
5.   Waivers by Guarantor; Bank's Freedom to Act.....................................  2
     -------------------------------------------
6.   Unenforceability of Obligations Against Borrower................................  3
     ------------------------------------------------
7.   Subrogation; Subordination......................................................  3
     --------------------------
         7.1.  Waiver of Rights Against Borrower.....................................  3
               ---------------------------------
         7.2.  Subordination.........................................................  4
               -------------
         7.3.  Provisions Supplemental...............................................  4
               -----------------------
8.   Setoff..........................................................................  4
     ------
9.   Further Assurances..............................................................  4
     ------------------
10.  Release.........................................................................  4
     -------
11.  Termination; Reinstatement......................................................  4
     --------------------------
12.  Successors and Assigns..........................................................  5
     ----------------------
13.  Amendments and Waivers..........................................................  5
     ----------------------
14.  Notices.........................................................................  5
     -------
15.  Governing Law; Consent to Jurisdiction..........................................  5
     --------------------------------------
16.  Waiver of Jury Trial............................................................  6
     --------------------
17.  Miscellaneous...................................................................  6
     -------------
</TABLE>


<PAGE>

                                    GUARANTY
                                    --------

     GUARANTY, dated as of February 20, 2002, by MEDALLION FUNDING CHICAGO
CORP., a Delaware corporation (the "Guarantor") in favor of (i) FLEET NATIONAL
BANK, a national banking association, as agent (hereinafter, in such capacity,
the "Agent") for itself and the other banking institutions (hereinafter,
collectively, the "Banks") which are or may become parties to an Amended and
Restated Loan Agreement dated as of December 24, 1997 (as amended and in effect
from time to time, the "Loan Agreement"), among Medallion Funding Corp., a New
York corporation ("Borrower"), the Banks and the Agent and (ii) each of the
Banks.

     WHEREAS, the Borrower and the Guarantor are members of a group of related
corporations, the success of any one of which is dependent in part on the
success of the other members of such group;

     WHEREAS, the Guarantor expects to receive substantial direct and indirect
benefits from the extensions of credit to the Borrower by the Banks pursuant to
the Loan Agreement (which benefits are hereby acknowledged);

     WHEREAS, it is a post-closing condition to Amendment No. 6 (as defined in
the Loan Agreement) that the Guarantor execute and deliver to the Agent, for the
benefit of the Banks and the Agent, a guaranty substantially in the form hereof;
and

     WHEREAS, the Guarantor wishes to guaranty the Borrower's obligations to the
Banks and the Agent under or in respect of the Loan Agreement as provided
herein;

     NOW, THEREFORE, the Guarantor hereby agrees with the Banks and the Agent as
follows:

     1.  Definitions. The term "Obligations" shall have the meaning provided
         -----------
therefor in the Borrower Security Agreement (as defined in the Loan Agreement);
all other capitalized terms used herein without definition shall have the
respective meanings provided therefor in the Loan Agreement.

     2.  Guaranty of Payment and Performance. The Guarantor hereby guarantees to
         -----------------------------------
the Banks and the Agent the full and punctual payment when due (whether at
stated maturity, by required pre-payment, by acceleration or otherwise), as well
as the performance, of all of the Obligations including all such which would
become due but for the operation of the automatic stay pursuant to ss.362(a) of
the Federal Bankruptcy Code and the operation of ss.ss.502(b) and 506(b) of the
Federal Bankruptcy Code. This Guaranty is an absolute, unconditional and
continuing guaranty of the full and punctual payment and performance of all of
the Obligations and not of their collectibility only and is in no way
conditioned upon any requirement that the Agent or any Bank first attempt to
collect any of the Obligations from the Borrower or resort to any collateral
security or other means of obtaining payment. Should the Borrower default in the
payment or performance of any of the Obligations, the obligations of the
Guarantor hereunder with


<PAGE>
                                       -2-

respect to such Obligations in default shall, upon demand by the Agent, become
immediately due and payable to the Agent, for the benefit of the Banks and the
Agent, without demand or notice of any nature, all of which are expressly waived
by the Guarantor. Payments by the Guarantor hereunder may be required by the
Agent on any number of occasions. All payments by the Guarantor hereunder shall
be made to the Agent, in the manner and at the place of payment specified
therefor in the Loan Agreement, for the account of the Banks and the Agent.

     3.  Intercreditor Agreement. The Agent, on behalf of itself and the Banks,
         -----------------------
acknowledges and agrees that this Guaranty granted for the benefit of the Agent
and the Banks, shall constitute "Collateral" as defined in the Intercreditor
Agreement and shall be subject to the provisions of the Intercreditor Agreement
for so long as the Intercreditor Agreement may be in effect.

     4.  Guarantor's Agreement to Pay Enforcement Costs, etc. The Guarantor
         ---------------------------------------------------
further agrees, as the principal obligor and not as a guarantor only, to pay to
the Agent, on demand, all costs and expenses (including court costs and legal
expenses) incurred or expended by the Agent or any Bank in connection with the
Obligations, this Guaranty and the enforcement hereof and thereof, together with
interest on amounts recoverable under this ss.4 from the time when such amounts
become due until payment, whether before or after judgment, at the rate of
interest for overdue principal set forth in the Loan Agreement, provided that if
                                                                --------
such interest exceeds the maximum amount permitted to be paid under applicable
law, then such interest shall be reduced to such maximum permitted amount.

     5.  Waivers by Guarantor; Bank's Freedom to Act. The Guarantor agrees that
         -------------------------------------------
the Obligations will be paid and performed strictly in accordance with their
respective terms, regardless of any law, regulation or order now or hereafter in
effect in any jurisdiction affecting any of such terms or the rights of the
Agent or any Bank with respect thereto. The Guarantor waives promptness,
diligences, presentment, demand, protest, notice of acceptance, notice of any
Obligations incurred and all other notices of any kind, all defenses which may
be available by virtue of any valuation, stay, moratorium law or other similar
law now or hereafter in effect, any right to require the marshalling of assets
of the Borrower or any other entity or other person primarily or secondarily
liable with respect to any of the Obligations, and all suretyship defenses
generally. Without limiting the generality of the foregoing, the Guarantor
agrees to the provisions of any instrument evidencing, securing or otherwise
executed in connection with any Obligation and agrees that the obligations of
the Guarantor hereunder shall not be released or discharged, in whole or in
part, or otherwise affected by (i) the failure of the Agent or any Bank to
assert any claim or demand or to enforce any right or remedy against the
Borrower or any other entity or other person primarily or secondarily liable
with respect to any of the Obligations; (ii) any extensions, compromise,
refinancing, consolidation or renewals of any Obligation; (iii) any change in
the time, place or manner of payment of any of the Obligations or any
rescissions, waivers, compromise, refinancing, consolidation or other amendments
or modifications of any of the terms or provisions of the Loan Agreement, the
other Loan Documents or any other agreement evidencing, securing or otherwise


<PAGE>
                                       -3-

executed in connection with any of the Obligations, (iv) the addition,
substitution or release of any entity or other person primarily or secondarily
liable for any Obligation; (v) the adequacy of any rights which the Agent or any
Bank may have against any collateral security or other means of obtaining
repayment of any of the Obligations; (vi) the impairment of any collateral
securing any of the Obligations, including without limitation the failure to
perfect or preserve any rights which the Agent or any Bank might have in such
collateral security or the substitution, exchange, surrender, release, loss or
destruction of any such collateral security; or (vii) any other act or omission
which might in any manner or to any extent vary the risk of the Guarantor or
otherwise operate as a release or discharge of the Guarantor, all of which may
be done without notice to the Guarantor. To the fullest extent permitted by law,
the Guarantor hereby expressly waives any and all rights or defenses arising by
reason of (A) any "one action" or "anti-deficiency" law which would otherwise
prevent the Agent or any Bank from bringing any action, including any claim for
a deficiency, or exercising any other right or remedy (including any right of
set-off), against the Guarantor before or after the Agent's or such Bank's
commencement or completion of any foreclosure action, whether judicially, by
exercise of power of sale or otherwise, or (B) any other law which in any other
way would otherwise require any election of remedies by the Agent or any Bank.

     6.  Unenforceability of Obligations Against Borrower. If for any reason the
         ------------------------------------------------
Borrower has no legal existence or is under no legal obligation to discharge any
of the Obligations, or if any of the Obligations have become irrecoverable from
the Borrower by reason of the Borrower's insolvency, bankruptcy or
reorganization or by other operation of law or for any other reason, this
Guaranty shall nevertheless be binding on the Guarantor to the same extent as if
the Guarantor at all times had been the principal obligor on all such
Obligations. In the event that acceleration of the time for payment of any of
the Obligations is stayed upon the insolvency, bankruptcy or reorganization of
the Borrower, or for any other reason, all such amounts otherwise subject to
acceleration under the terms of the Loan Agreement, the other Loan Documents or
any other agreement evidencing, securing or otherwise executed in connection
with any Obligation shall be immediately due and payable by the Guarantor.

     7.  Subrogation; Subordination.
         --------------------------

           7.1.  Waiver of Rights Against Borrower. Until the final payment and
                 ---------------------------------
     performance in full of all of the Obligations, the Guarantor shall not
     exercise and hereby waives any rights against the Borrower arising as a
     result of payment by the Guarantor hereunder, by way of subrogation,
     reimbursement, restitution, contribution or otherwise, and will not prove
     any claim in competition with the Agent or any Bank in respect of any
     payment hereunder in any bankruptcy, insolvency or reorganization case or
     proceedings of any nature; the Guarantor will not claim any setoff,
     recoupment or counterclaim against the Borrower in respect of any liability
     of the Guarantor to the Borrower; and the Guarantor waives any benefit of
     and any right to participate in any collateral security which may be held
     by the Agent or any Bank.


<PAGE>

                                      -4-

          7.2. Subordination. The payment of any amounts due with respect to any
               -------------
     indebtedness of the Borrower for money borrowed or credit received now or
     hereafter owed to the Guarantor is hereby subordinated to the prior payment
     in full of all of the Obligations. The Guarantor agrees that, after the
     occurrence of any default in the payment or performance of any of the
     Obligations, the Guarantor will not demand, sue for or otherwise attempt to
     collect any such indebtedness of the Borrower to the Guarantor until all of
     the Obligations shall have been paid in full. If, notwithstanding the
     foregoing sentence, the Guarantor shall collect, enforce or receive any
     amounts in respect of such indebtedness while any Obligations are still
     outstanding, such amounts shall be collected, enforced and received by the
     Guarantor as trustee for the Banks and the Agent and be paid over to the
     Agent, for the benefit of the Banks and the Agent, on account of the
     Obligations without affecting in any manner the liability of the Guarantor
     under the other provisions of this Guaranty.

          7.3. Provisions Supplemental. The provisions of this ss.7 shall be
               -----------------------
     supplemental to and not in derogation of any rights and remedies of the
     Banks and the Agent under any separate subordination agreement which the
     Agent may at any time and from time to time enter into with the Guarantor
     for the benefit of the Banks and the Agent.

     8.  Setoff. Regardless of any other means of obtaining payment of any of
         ------
the Obligations, each of the Agent and the Banks is hereby authorized at any
time and from time to time, without notice to the Guarantor (any such notice
being expressly waived by the Guarantor) and to the fullest extent permitted by
law, to set off and apply such deposits and other sums against the obligations
of the Guarantor under this Guaranty, whether or not the Agent or such Bank
shall have made any demand under this Guaranty and although such obligations may
be contingent or unmatured.

     9.  Further Assurances. The Guarantor agrees that it will from time to
         ------------------
time, at the request of the Agent, do all such things and execute all such
documents as the Agent may consider necessary or desirable to give full effect
to this Guaranty and to perfect and preserve the rights and powers of the Banks
and the Agent hereunder. The Guarantor acknowledges and confirms that the
Guarantor itself has established its own adequate means of obtaining from the
Borrower on a continuing basis all information desired by the Guarantor
concerning the financial condition of the Borrower and that the Guarantor will
look to the Borrower and not to the Agent or any Bank in order for the Guarantor
to keep adequately informed of changes in the Borrower's financial condition.

     10. Release. Notwithstanding any provision of this Guaranty to the
         -------
contrary, this Guaranty shall not be released without the prior written consent
of the Agent and the Required Banks.

     11. Termination; Reinstatement. This Guaranty shall remain in full force
         --------------------------
and effect until the Agent and Required Banks release the Guarantor from the
Guaranty or until all Borrower Obligations have been paid in full and all
         --
commitments to lend under


<PAGE>

                                      -5-

the Loan Agreement have been terminated. This Guaranty shall continue to be
effective or be reinstated, notwithstanding any such repayment in full of the
Obligations, and termination of all commitments to lend under the Loan
Agreement, if at any time any payment made or value received with respect to any
Obligation is rescinded or must otherwise be returned by the Agent or any Bank
upon the insolvency, bankruptcy or reorganization of the Borrower, or otherwise,
all as though such payment had not been made or value received.

     12.  Successors and Assigns. This Guaranty shall be binding upon the
          ----------------------
Guarantor, its successors and assigns, and shall inure to the benefit of the
Agent and the Banks and their respective successors, transferees and assigns.
Without limiting the generality of the foregoing sentence, each Bank may assign
or otherwise transfer the Loan Agreement, the other Loan Documents or any other
agreement or note held by it evidencing, securing or otherwise executed in
connection with the Obligations, or sell participations in any interest therein,
to any other entity or other person, and such other entity or other person shall
thereupon become vested, to the extent set forth in the agreement evidencing
such assignment, transfer or participation, with all the rights in respect
thereof granted to such Bank herein, all in accordance with ss.12 of the Loan
Agreement. The Guarantor may not assign any of its obligations hereunder without
the prior written consent of the Agent and the Banks (and any such assignment
without such consent shall be null and void).

     13.  Amendments and Waivers. No amendment or waiver of any provision of
          ----------------------
this Guaranty nor consent to any departure by the Guarantor therefrom shall be
effective unless the same shall be in writing and signed by the Agent with the
consent of the Majority Banks. No failure on the part of the Agent or any Bank
to exercise, and no delay in exercising, any right hereunder shall operate as a
waiver thereof; nor shall any single or partial exercise of any right hereunder
preclude any other or further exercise thereof or the exercise of any other
right.

     14.  Notices. All notices and other communications called for hereunder
          -------
shall be made in writing and, unless otherwise specifically provided herein,
shall be deemed to have been duly made or given when delivered by hand or mailed
first class, postage prepaid, or, in the case of telegraphic or telexed notice,
when transmitted, answer back received, addressed as follows: if to the
Guarantor, at the address set forth beneath its signature hereto, and if to the
Agent, at the address for notices to the Agent set forth on Exhibit A of the
Loan Agreement, or at such address as either party may designate in writing to
the other.

     15.  Governing Law; Consent to Jurisdiction. THIS GUARANTY IS INTENDED TO
          --------------------------------------
TAKE EFFECT AS A SEALED INSTRUMENT AND SHALL BE GOVERNED BY, AND CONSTRUED IN
ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK. The Guarantor agrees that
any suit for the enforcement of this Guaranty may be brought in the courts of
the State of New York or any federal court sitting therein and consents to the
nonexclusive jurisdiction of such court and to service of process in any such
suit being made upon the Guarantor by mail at the address specified by reference
in ss.14. The Guarantor hereby waives any objection that it may

<PAGE>

                                      -6-

now or hereafter have to the venue of any such suit or any such court or that
such suit was brought in an inconvenient court.

     16.  Waiver of Jury Trial. THE GUARANTOR HEREBY WAIVES ITS RIGHT TO A JURY
          --------------------
TRIAL WITH RESPECT TO ANY ACTION OR CLAIM ARISING OUT OF ANY DISPUTE IN
CONNECTION WITH THIS GUARANTY, ANY RIGHTS OR OBLIGATIONS HEREUNDER OR THE
PERFORMANCE OF ANY OF SUCH RIGHTS OR OBLIGATIONS. Except as prohibited by law,
the Guarantor hereby waives any right which it may have to claim or recover in
any litigation referred to in the preceding sentence any special, exemplary,
punitive or consequential damages or any damages other than, or in addition to,
actual damages. The Guarantor (i) certifies that neither the Agent or any Bank
nor any representative, agent or attorney of the Agent or any Bank has
represented, expressly or otherwise, that the Agent or any Bank would not, in
the event of litigation, seek to enforce the foregoing waivers and (ii)
acknowledges that, in entering into the Loan Agreement and the other Loan
Documents to which the Agent or any Bank is a party, the Agent and the Banks are
relying upon, among other things, the waivers and certifications contained in
this ss16.

     17.  Miscellaneous. This Guaranty constitutes the entire agreement of the
          -------------
Guarantor with respect to the matters set forth herein. The rights and remedies
herein provided are cumulative and not exclusive of any remedies provided by law
or any other agreement, and this Guaranty shall be in addition to any other
guaranty of or collateral security for any of the Obligations. The invalidity or
unenforceability of any one or more sections of this Guaranty shall not affect
the validity or enforceability of its remaining provisions. Captions are for the
ease of reference only and shall not affect the meaning of the relevant
provisions. The meanings of all defined terms used in this Guaranty shall be
equally applicable to the singular and plural forms of the terms defined.


    [Remainder of page intentionally left blank; signature pages immediately
                                    follow.]


<PAGE>

                                      -7-

     IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to be executed
and delivered as of the date first above written.


                                MEDALLION FUNDING CHICAGO CORP.


                                By: /s/ Alvin Murstein
                                    -------------------------------
                                    Alvin Murstein
                                    Chairman & Chief Executive Officer


                                By: /s/ James E. Jack
                                    -------------------------------
                                    James E. Jack
                                    Chief Financial Officer


                                    Address: