8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

^{______________}

FORM 8-K

^{______________}

CURRENT REPORT PURSUANT

TO SECTION 13 OR 15(d) OF

THE SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): November 12, 2009

AMERITRANS CAPITAL CORPORATION

 (Exact Name of Registrant as Specified in Its Charter)

Delaware	333-63951	52-2102424
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(I.R.S. Employer Identification No.)

747 Third Avenue, 4th Floor

New York, New York 10017

(Address of Principal Executive Offices (Zip Code))

(212) 355-2449

 (Registrant’s Telephone Number, Including Area Code)

N/A

(Former Name of Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

[_]

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

[_]

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17CFR 240.14a-12)

[_]

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

[_]

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Item 2.02 Results of Operations and Financial Condition

On November 16, 2009, Ameritrans Capital Corp. (the “Company”) issued a press release announcing its results for the first fiscal quarter ended September 30, 2009.  A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.  

Item 5.02.  Departure of Directors or Certain Officers; Election of Directors; Appointment of Certain Officers; Compensatory Arrangements of Certain Officers.

On November 12, 2009, Ameritrans Capital Corp. (the “Company”) and Elk Associate Funding Corporation (“Elk”), a wholly-owned subsidiary of the Company, entered into an amended and restated employment agreement with Michael Feinsod, the Company’s President and Chief Executive Officer and Elk’s Senior Vice-President (the “Feinsod Agreement”) and amendments to the employment agreements with Gary Granoff, the Company’s Chief Financial Officer, Ellen Walker, the Company’s Executive Vice President and Lee Florenza, the Company’s Senior Vice President (each, an “Amendment”).  

Pursuant to the Feinsod Agreement, Mr. Feinsod will continue to serve as President and Chief Executive Officer of the Company and Senior Vice President of Elk until August 31, 2010, and one year thereafter, unless the Company notifies Mr. Feinsod of its intention not to renew the employment agreement in accordance with its terms, and unless the Feinsod Agreement is terminated earlier in accordance with its terms.   For the period from November 12, 2009 through August 31, 2010, Mr. Feinsod will receive a base salary equal to $376,800 payable on an annualized basis.  If applicable, for the period commencing September 1, 2010 through August 31, 2011, Mr. Feinsod’s base salary will be increased by the greater of four percent (4%) or the increase in the Consumer Price Index during such year.  Mr. Feinsod will also receive an annual bonus in the sole discretion of the Company’s board of directors.  

Mr. Feinsod is also entitled to receive an aggregate of $32,500 per annum for reimbursement of certain expenses set forth in the agreement as well as reimbursement for all business expenses reasonably incurred by him in the performance of his duties as well as up to $20,000 per annum, subject to certain increases, for Mr. Feinsod’s family health insurance.  The Company will continue to make regular contributions to Mr. Feinsod’s SEP IRA account.

The Company also agreed to use reasonable efforts to register the sale of the Company’s common stock underlying options previously granted to Mr. Feinsod, provided that the Company is eligible to register such shares on Form S-8 under the Securities Act of 1933, as amended, and rules promulgated thereunder.  

In the event that the Company terminates Mr. Feinsod’s employment without “Cause” (as defined in the Feinsod Agreement), or Mr. Feinsod terminates his employment for “Good Reason” (as defined in the Feinsod Agreement), Mr. Feinsod will be entitled to a severance payment in an amount equal to Mr. Feinsod’s base salary, as increased with respect to the extension year, and bonus (or portion thereof), if any, paid for the most recent bonus year, multiplied by the number of years (or fractional portion thereof) remaining in the employment period, inclusive of the additional one year extension period under the Feinsod Agreement.  The Company will also be obligated to continue Mr. Feinsod’s benefits through August 31, 2010 and, if such terminatin occurs after August 31, 2010, for the remainder of the extension year.  

The Feinsod Agreement also provides that Mr. Feinsod will not compete with the Company or Elk or hire solicit the employ of any employee of the Company or Elk during the term of the Feinsod Agreement and for the immediately succeeding 12 month period.  

Pursuant to the Granoff Amendment, Mr. Granoff will agree to continue serving as Chief Financial Officer of the Company and Elk through June 30, 2010 (instead of the September 30, 2009 date as in effect prior to the Granoff Amendment). However, that if the Company and Elk exercise their right to employ a qualified person to replace Mr. Granoff as Chief Financial Officer at any time prior to June 30, 2010, Mr. Granoff will step down as Chief Financial Officer without any reduction in compensation.  Pursuant to the Granoff Amendment, Mr. Granoff’s salary for the fiscal year ending June 30, 2010 will be reduced by $40,000 and an additional $33,725 of Mr. Granoff’s base salary for such fiscal year will be paid on a deferred basis in $11,241.66 installments during the next succeeding three fiscal years.  Accordingly, Mr. Granoff will be entitled to receive a base salary of $391,275 during the 2009/2010.  Mr. Granoff also waived payment o f the Company’s contribution to his SEP IRA account for the period commencing October 1, 2009 and ending September 30, 2010. The Company also assigned ownership of a life insurance policy insuring to Mr. Granoff.  

Pursuant to the Walker and Forlenza Amendments, Ms. Walker and Mr. Forlenza waived payment of the Company’s contribution to their respective SEP IRA accounts for the period commencing October 1, 2009 and ending September 30, 2010.  The Walker and Forlenza Amendments also clarified that the employment duties of Ms. Walker and Mr. Forlenza include the liquidation and disposition of certain “legacy” portfolio loans of the Company, as directed by the Board of Directors.  The Company also agreed to continue to pay premiums on Ms. Walker’s disability insurance policies.

The foregoing descriptions of the Feinsod Agreement and the Granoff, Walker and Forlenza Amendments, do not purport to describe all of the terms of such agreement or amendments and are qualified in their entirety by reference to the complete text thereof, which are filed as exhibits to this Current Report on Form 8-K.

Item 9.01.

Financial Statements and Exhibits.  

Exhibit No.	Description
10.1	Amended and Restated Employment Agreement, dated November 12, 2009, among Ameritrans Capital Corporation and Elk Associates Funding Corporation.
10.2	First Amendment to the Amended and Restated Employment Agreement, dated November 12, 2009, between Gary C. Granoff, Ameritrans Capital Corporation and Elk Associates Funding Corporation.
10.3	First Amendment to the Amended and Restated Employment Agreement, dated November 12, 2009, between Ellen M. Walker, Ameritrans Capital Corporation and Elk Associates Funding Corporation.
10.4	First Amendment to the Amended and Restated Employment Agreement, dated November 12, 2009, between Lee A. Forlenza, Ameritrans Capital Corporation and Elk Associates Funding Corporation.
99.1	Press Release, dated November 16, 2009.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly authorized and caused the undersigned to sign this Report on the Registrant's behalf.

Dated: October 26, 2009

AMERITRANS CAPITAL CORPORATION

By: /s/ Michael Feinsod                           

Name: Michael Feinsod

Title: Chief Executive Officer and President

Exhibit Index

Exhibit No.	Description
10.1	Amended and Restated Employment Agreement, dated November 12, 2009, among Ameritrans Capital Corporation and Elk Associates Funding Corporation.
10.2	First Amendment to the Amended and Restated Employment Agreement, dated November 12, 2009, between Gary C. Granoff, Ameritrans Capital Corporation and Elk Associates Funding Corporation.
10.3	First Amendment to the Amended and Restated Employment Agreement, dated November 12, 2009, between Ellen M. Walker, Ameritrans Capital Corporation and Elk Associates Funding Corporation.
10.4	First Amendment to the Amended and Restated Employment Agreement, dated November 12, 2009, between Lee A. Forlenza, Ameritrans Capital Corporation and Elk Associates Funding Corporation.
99.1	Press Release, dated November 16, 2009.

EX-10.1

Exhibit 10.1

AMENDED AND RESTATED EMPLOYMENT AGREEMENT

This AMENDED AND RESTATED EMPLOYMENT AGREEMENT (this “Agreement”) is dated as of November 12, 2009, between Michael R. Feinsod (“Executive”), Ameritrans Capital Corporation (“Ameritrans”), and Elk Associates Funding Corporation “Elk”) (collectively, Ameritrans and Elk are hereinafter referred to as the “Employer”).

WHEREAS, Executive is presently employed as President and Chief Executive Officer of Ameritrans and Senior Vice President of Elk pursuant to that certain Amended and Restated Employment Agreement dated as of October 10, 2008 (the “October 2008 Agreement”);

WHEREAS, the Employer and Executive desire to restate and amend certain terms of the October 2008 Agreement;

NOW, THEREFORE BE IT, in consideration of the promises and the mutual covenants hereinafter set forth and other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto hereby agree as follows:  

1.

Employment of Executive.

Effective as of the date of this Agreement, Employer hereby agrees to employ Executive, and Executive hereby agrees to be and remain in the employ of Employer, upon the terms and conditions hereinafter set forth.

2.

Employment Period.

Subject to the earlier termination as provided in Section 5, the term of Executive’s employment under this Agreement shall commence as of the date of this Agreement (the “Effective Date”), and shall continue until August 31, 2010 (the “Extended Employment Period”).  Unless Employer gives notice of non-renewal at least three (3) months prior to the expiration of the Extended Employment Period or Executive gives notice of non-renewal at least three (3) months prior to the expiration of the Extended Employment Period, the term of this Agreement shall be extended for an additional one (1) year period beyond the end of the Extended Employment Period on the same terms and conditions in effect under this Agreement at the time of extension and providing for an annual base salary equal to the Base Salary (as hereinafter defined) in effect at the time of renewal, plus an annual increase during the renewal year of greater of (i) four percent (4%) or (ii) the increase in the Consumer Price Index during such year (the Extended Employment Period and any extension thereof is hereafter referred to as the “Employment Period”).  The parties agree that any Bonus (as hereinafter defined) payable during any renewal period shall be paid solely in the discretion of the Board of Directors of Employer (the “Board”).

3.

Duties and Responsibilities.

3.1.

General  During the Employment Period, Executive shall have the title of Chief Executive Officer and President of Ameritrans and Senior Vice President of Elk, and shall have duties commensurate with his office and title.  Executive shall report directly to and take direction from the Board.  Executive understands that he will be required to work with and coordinate certain business activities with other executives of the Employer in connection with certain projects as directed by the Board.  Executive shall devote all of his business time and expend his best efforts, energies, and skills to the Employer provided, however, Executive shall be allowed to devote such reasonable time as he deems necessary to his personal and family business matters and to fulfill his duties as Managing Member of Infinity Capital LLC, as such duties and responsibilities exist on the date hereof, so long as such time and attention does not (A) interfere wit h his duties and responsibilities to Employer or (B) violate his obligations under Sections 7 and 8, herein, or any duty, consistent with his status with Employer, as he may be assigned from time to time by the Board.

1

4.

Compensation and Related Matters.

4.1.

Base Salary  For the period commencing with the date of this Agreement, and ending on August 31, 2010, Employer shall pay to Executive on the basis of an annualized base salary equal to $376,800.  (the “Base Salary”).  The Base Salary shall be payable in accordance with the normal payroll procedures of Employer.

4.2.

Annual Bonus  For each year during the Employment Period (each, a “Bonus Year”), which shall be measured by the twelve month period ending on December 31, Executive shall be eligible to receive a bonus for such Bonus Year (a “Bonus”), in the sole discretion of the Board.  The Bonus for each Bonus Year shall be payable promptly following the determination of the Board thereof, but in no event later than 45 days after the end of such year.  

4.3.

Other Benefits  During the Employment Period, subject to, and to the extent Executive is eligible under their respective terms, Executive shall be entitled to receive up to an aggregate of $32,500 each twelve month period ending on August 31st  of each year  allocated by Executive as he shall determine in his sole discretion for the following: (i) reimbursement of Executive for the cost of the annual premiums on term life insurance on Executive’s life, (ii) the lease of a car, (iii) parking for Executive’s automobile in Manhattan, (iv) tolls and gas for the automobile in connection with commuting to work, (v) automobile insurance for one car (vi) use of a cell phone and home telephone for business purposes, and  (vii) reimbursement for the premium on Executive’s disability policy. In addition, the Employer shall pay the Executive’s family medical health insurance premiums under the Employer’s current plan up to $20,000, plus any increases that may arise in future years above an annual premium of $25,230.   Employer will also make regular contributions to Executive’s SEP IRA account, subject to limitations under the plan, and any payment thereof, and the rate of such contributions paid, if any, shall be subject to the discretion of the Board of Directors.

4.4.

Expenses Reimbursement  Employer shall reimburse Executive for all business expenses reasonably incurred by him in the performance of his duties under this Agreement upon his presentation of signed and itemized accounts of such expenditures, all in accordance with Employer’s procedures and policies as adopted and in effect from time to time and applicable to its senior management employees.

4.5.

Vacations  Executive shall be entitled to 25 business days vacation for each  calendar year during the Employment Period, such vacations to be taken at such time or times as shall not unreasonably interfere with Executive’s performance of his duties under this Agreement.  Unused vacation days shall not carry over to future calendar years.

4.6.

Stock Options Employer has previously granted to the Executive aoptions to purchase  shares of Ameritrans common stock, par value $.0001 per share (the “Common Stock”). The options shall have such terms and conditions as set forth in the stock option agreement related to such grant.  Employer shall use reasonable efforts to register the sale of Common Stock underlying the option granted to Executive pursuant to a Registration Statement on Form S-8, provided that Form S-8 is available to Employer under the Securities Act of 1933 and the rules and regulations of the Securities and Exchange Commission at the time Executive exercises such options.  

4.7.

Office Space: Resources  Employer shall provide Executive with sufficient office space, administrative (secretarial) assistance, furnishings, equipment, computer resources, and supplies considered reasonable and necessary for Executive to carry out his duties.

5.

Termination of Employment Period.

5.1.

Termination On August 31, 2010  Employer shall, with notice have the right to terminate this agreement as of August 31, 2010.  Such determination to be made in the sole discretion of the Board.   If Executive is terminated pursuant to this Section 5.1, no Severance Payment (or defined in section 6.1 hereof) shall be paid.   Employer will be paid his Base Salary through the date of termination on the next regular pay date.

5.2.

Termination Without Cause: Voluntary Termination by Executive  Employer may, by notice to Executive at any time during the Employment Period, terminate the Employment Period without Cause (as defined below).  The effective date of such termination of Executive from Employer shall be the date that is thirty (30) days following the date on which such notice is given, except as otherwise specifically provided herein.  Executive may, by notice to Employer at any time during the Employment Period, voluntarily resign from Employer and terminate

the Employment Period.  The effective date of such termination of Executive from Employer shall be the date that is thirty (30) days following the date on which such notice is given.  

2

5.3.

By Employer for Cause  Employer may, at any time during the Employment Period, by notice to Executive, terminate the Employment Period for “Cause.”  As used herein, “Cause” shall mean (i) incompetence, fraud, personal dishonesty, or acts of gross negligence or gross misconduct on the part of Executive in the course of his employment, (ii) an intentional breach of this Agreement by Executive that is injurious to Employer, (iii) substantial and continued failure by Executive to perform his duties hereunder, (iv) willful failure by Executive to follow the lawful directions of the Board, (v) use of alcohol by Executive or his illegal use of drugs (including narcotics) which in either case is, or could reasonably expected to become, materially injurious to the reputation or business of Employer or which impairs, or could reasonably be expected to impair, the performance of Executive’s duties hereunder, (vi) Executive’s conviction by a court of competent jurisdiction of, or pleading “guilty” or “no contest” to, (x) a felony, or (y) any other criminal charge (other than minor traffic violations) which has or could reasonably be expected to have a material adverse impact on Employer’s reputation and standing in the community, or (vii) Executive’s violation of any of the provisions of Section 7 or 8 herein.  Any notice given by Employer pursuant to Section 5.3(ii), (iii), or (iv), above, shall specify in writing in reasonable detail the nature of Executive’s action or inaction that is the cause for giving such notice.  Executive will have 30 days to cure, to the reasonable satisfaction of Employer, any action or inaction charged by Employer for Cause under (ii), (iii), or (iv), above.  In the event of a termination of the Employment Period for Cause under (i), (v), (vi), or (vii), above, the Employment Period shall terminate immediately upon notice by Employer of termination f or Cause.  In all other cases of a termination of the Employment Period for Cause, the Employment Period shall terminate 30 days after such notice of termination for Cause, unless Executive has satisfactorily cured such actions or inactions.

5.4

By Employee for Good Reason  Executive may, by notice to Employer, at any time during the Employment Period, terminate the Employment Period under this Agreement for “Good Reason.”  For the purposes hereof, Executive shall have “Good Reason” to terminate employment with Employer on account of any of the following events without Executive’s consent:  (i) any reduction in the Base Salary; (ii) the failure of Employer to provide employee benefits consistent with Section 4.3, herein; (iii) any requirement by Employer that Executive report to anyone other than the Board; (iv) a change in Executive’s duties or position, or (v) a “Change of Control” (as defined below); provided however, that the circumstances set forth in this Section 5.4 shall not constitute Good Reason if within 30 days of notice by Executive, Employer cures such circumstances.  Notwithstanding anything to the contrary contained in this Section 5.4, if a “Change of Control” occurs during the Employment Period, Executive may terminate for Good Reason only if Executive’s employment is not otherwise subject to a notice of termination under any other provision of this Section 5.  The effective date of such termination shall be the date that is thirty (30) days following the date on which such notice is given.  For purposes of this Section 5.4, a “Change in Control” shall be deemed to have taken place if any “Person” (as such term is defined in Section 3(a)(9) of the Securities Exchange Act of 1934 (the “Exchange Act”) and as used in Sections 13(d)(3) and 14(d)(2) of the Exchange Act) becomes a “beneficial owner” (as defined in Rule 13-3 under the Exchange Act), directly or indirectly, of securities of the Employer representing 50% or more of the combined voting power of Employer’s then outstanding securities eligible to vote for the election of the Board (the “Votin g Securities”);’ provided, however, that the event described in this paragraph (b) shall not be deemed to be a Change in Control by virtue of any of the following acquisitions:  (i) any Employer or any subsidiary of Employer in which Employer owns more than 50% of the combined voting power of such entity (a “Subsidiary”), (ii) by any employee benefit plan (or related trust) sponsored or maintained by Employer or any Subsidiary, (iii) by any underwriter temporarily holding Employer’s Voting Securities pursuant to an offering of such Voting Securities, or (vi) pursuant to any acquisition by Executive or any group or persons including Executive (or any entity controlled by Executive or any group of persons including Executive).

5.5  Disability  During the Employment Period, if, as a result of physical or mental incapacity or infirmity, Executive shall be unable to perform his duties under this Agreement for (i) a continuous period of at least 180 days, or (ii) periods aggregating at least 180 days during any period of 12 consecutive months (each, a “Disability Period”), and at the end of the Disability Period there is no reasonable probability that Executive can promptly resume his duties hereunder with or without reasonable accommodation, Executive shall be deemed disabled (the “Disability”) and Employer, by notice to Executive, shall have the right to terminate the Employment Period for Disability at, as of, or after the end of the Disability Period.  The existence of the Disability shall be determined by a reputable, licensed physician selected by Executive in good faith, whose determination shall be final and binding on the parties.  Executiv e shall cooperate in all reasonable respects to enable an examination to be made by such physician.  

3

5.6  Death  The Employment period shall end on the date of Executive’s death.

Any termination under this Section 5 shall act as a notice of non-renewal of this Agreement pursuant to Section 2 herein.

6. Termination Compensation

6.1.

Termination Without Cause by Employer.  If the Employment Period is terminated by Employer without Cause pursuant to the provisions of Section 5.2 hereof, Employer will pay to Executive his Base Salary through the date of termination on the next regular pay date and a lump sum payment equal to the product of (x) Executive’s Base Salary and Bonus (or portion thereof), if any, paid for the most recent Bonus Year multiplied by (y) the number of years (and fractional portions thereof) remaining in the Extended Employment Period, if termination occurs during the Extended Employment Period (such payment hereinafter referred to as a “Severance Payment”).  In calculating the Severance Payment, such payment shall include adjustments in Base Salary (as set forth in Section 4.1) that would have occurred during the remainder of the Extended Employment Period, as the case may be, had Executive’s employment not been terminated.  In addition, provided the date of termination under Section 5.2 is after the end of a calendar year for which a Bonus is payable, but prior to the date of payment, Employer shall also pay to Executive the Bonus for such Bonus Year.  Further, Employer shall have the obligation to continue the benefits provided for in Section 4 past the date of termination through the balance of the Initial Employment Period if termination occurs during such period or the Extended Employment Period remaining as the care may be, at the time of termination.

6.2.

Termination by Executive for Good Reason  Except as otherwise specifically provided herein, if the Employment Period is terminated by Executive for Good Reason pursuant to the provisions of Section 5.4, hereof, Employer will pay to Executive his Base Salary through the date of termination on the next regular pay date and in a lump-sum, the Severance Payment, and provide benefits and any accrued but unpaid Bonus pursuant to the terms set forth in Section 6.1.

6.3.[INTENTIONALLY LEFT BLANK]

6.4.  Certain Other Terminations  If the Employment Period is terminated by Employer on account of Executive’s Disability pursuant to the provisions of Section 5.5, or by death, pursuant to the provisions of Section 5.6, Employer shall pay to Executive, on the next regular pay date, Executive’s Base Salary through the date of termination.  Provided the date of termination under Section 5.5, or 5.6 is after the end of a calendar year for which a Bonus is payable, but prior to the date of payment, Employer shall also pay to Executive or Executive’s representatives, as the case may be, the Bonus for such Bonus Year.  In the event that the Employment Period is terminated by Employer on account of Disability pursuant to the provisions of Section 5.5 or on account of death pursuant to the provisions of Section 5.6 and provided Executive has been employed for at least six months during the Bonus Year of termination, Employer shall als o pay to Executive a portion of the Bonus for the Bonus Year of termination prorated through the date of termination.  If the Employment Period is terminated by Employer for Cause pursuant to Section 5.3 or by Employee without Good Reason pursuant to Section 5.2, Employer shall pay to Executive, on the next regular pay date, Executive’s Base Salary through the date of termination.  Provided the date of termination under Section 5.2, or 5.3 is after the end of a calendar year for which a Bonus is payable, but prior to the date of payment, Employer shall also pay to Executive the Bonus for such Bonus Year.  Employer shall have no obligation to continue any other benefits provided for in Section 4 past the date of termination, other than as required by law.

6.5.

Payment; No Other Termination Compensation  Any payment pursuant to this Section 6, with respect to which a payment date has not otherwise been specified, shall be made in a lump sum within forty five (45) business days following the date of such termination.  

7.

Confidentiality.

Unless otherwise required by law or judicial process, Executive shall retain in confidence during the Employment Period and after termination of Executive’s employment with Employer pursuant to this Agreement all confidential information known to Executive concerning Employer and its businesses.  The obligations of Executive pursuant to this Section 7 shall survive the expiration or termination of this Agreement.

4

8.

Noncompetition.

As a result of his employment with the Employer and his knowledge of the Employer’s business, customer relationships and/or know-how, the Executive agrees that he will not, during his employment with the Employer and for a period of 12 months immediately following termination of such employment without the prior written consent of the Employer, enter into any competitive business, employment or endeavor or in any way to enter the employ of, consult for, or own, directly or indirectly, any interests in any person or entity engaged in any business in which the Employer or any of its subsidiaries is engaged, or otherwise compete, directly or indirectly, with the Employer or any of its subsidiaries in any manner (“Competitive Activity”).  Notwithstanding any provision contained in this Section 8 to the contrary, Competitive Activity shall exclude those activities related to personal and family business and Infinity Capital LLC as described in Section 3.1, as such activities existed on the date hereof.  

9.

Nonsolicitation.

During the Employment Period and for a period of one (1) year thereafter (the “Nonsolicitation Period”), Executive shall not directly or indirectly solicit to enter into the employ of any other Entity, or hire, any of the employees of Employer.  During the Employment Period, and for a period of one year thereafter, Executive shall not, directly or indirectly, solicit, hire, or take away or attempt to solicit, hire, or take away (i) any customer or client of Employer (ii) any former customer or client (that is, any customer or client who ceased to do business with Employer during the three (3) years immediately preceding such date) without Employer’s prior written consent.  The obligations of Executive pursuant to this Section 9 shall survive the expiration or termination of this Agreement.  

10.

Successors; binding Agreement.

This Agreement and all rights of Executive hereunder shall inure to the benefit of and be enforceable by Executive and Executive’s personal or legal representatives, executors, administrators, successors, heirs, distributees, divises, and legatees.  If Executive should die while any amounts would still be payable to him hereunder if he had continued to live, all such amounts, unless otherwise provided herein, shall be paid in accordance with the terms of this Agreement to executive’s devisee, legatee, or other beneficiary or, if there be no such beneficiary, to Executive’s estate.  

11.

Survivorship.

The respective rights and obligations of the parties hereunder shall survive any termination of this Agreement to the extent necessary to the intended preservation of such rights and obligations.

12.

Miscellaneous.

12.1.

Notices  Any notice, consent, or authorization required or permitted to be given pursuant to this Agreement shall be in writing and sent to the party for or to whom intended, at the address of such party set forth below, by registered or certified mail, postage paid (deemed given five days after deposit in the U.S. mails) or personally delivered or sent by facsimile transmission (deemed given upon receipt), or at such other address as either party shall designate by notice given to the other in the manner provided herein.  

If to Employer

Ameritrans Capital Corporation

Elk Associates Funding Corporation

747 Third Avenue, 4^th Floor

New York, New York 10017

Attn:  Board of Directors

If to Executive:

To Mr. Michael R. Feinsod at his home address as reflected in the records of Employer

12.2.  Taxes  Employer is authorized to withhold (from any compensation or benefits payable hereunder to Executive) such amounts for income tax, social security, unemployment compensation, and other taxes as shall be necessary or appropriate in the reasonable judgment of Employer to comply with applicable laws and regulations.  

5

12.3.

Governing Law  This Agreement shall be governed by and construed and enforced in accordance with the laws of the State of New York, without reference to the principles of conflicts of laws therein.  

12.4.

Arbitration  Any dispute or controversy arising under or in connection with this Agreement shall be settled exclusively by arbitration in the city in which Employer’s main corporate headquarters is then located in accordance with the National Rules for the Resolution of Employment Disputes of the American Arbitration Association, before a single arbitrator.  Judgment may be entered on the arbitration award in any court having jurisdiction.  

12.5.

Headings  All descriptive headings in this Agreement are inserted for convenience only, and shall be disregarded in construing or applying any provisions of this Agreement.

12.6.

Counterparts  This Agreement may be executed in counterparts, each of which shall be deemed to be an original, but all of which, together shall constitute one and the same instrument.  

12.7.

Severability  If any provision of this Agreement, or any part thereof, is held to be unenforceable, the remainder of such provision and this Agreement, as the case may be, shall nevertheless remain in full force and effect.  

12.8.

Entire Agreement and Representation  This Agreement contains the entire agreement and understanding between Employer and Executive with respect to the subject matter hereof.  No representations or warranties of any kind or nature relating to Employer or its several businesses, or relating to Employer’s assets, liabilities, operations, future plans, or prospects have been made by or on behalf of Employer to Executive.  This Agreement supersedes any prior agreement between the parties relating to the subject matter hereof.  

12.9

Termination of October  2008 Agreement.  The Employer and Executive hereby acknowledge that this Agreement is an amendment and restatement of the October 2008 Agreement, and as such is a termination of the October 2008 Agreement.  Both Employer and Executive hereby relinquish any and all rights they may have resulting from the termination of the October 2008 Agreement.

12.10.  Amendment and Waiver.  This Agreement may be amended or modified only by a written instrument executed by both Employer and Executive.  No waiver by either of the parties of their rights shall be deemed to constitute a waiver with respect to any subsequent occurrences or transactions hereunder unless such waiver specifically states that it is to be construed as a continuing waiver.

12.11.  Validity..  The invalidity of unenforceability of any provision or provisions of this Agreement shall not affect the validity or enforceability of any other provision or provisions of this Agreement, which shall remain in full force and effect.  If any provision of this Agreement is held to be invalid, void, or unenforceable in any jurisdiction, any court or arbitrator so holding shall substitute a valid, enforceable provision that preserves, to the maximum lawful extent, the terms and intent of such provisions of this Agreement.  If any of the provisions of, or covenants contained in, this Agreement are hereafter construed to be invalid or unenforceable in any jurisdiction, the same shall not affect the remainder of the provisions or the enforceability thereof in any other jurisdiction, which shall be given full force and effect, without regard to the invalidity or unenforceability is such other jurisdiction.  Any such holding shall affect such provision of this Agreement, solely as to that jurisdiction, without rendering that or any other provisions of this Agreement, solely as to that jurisdiction, without rendering that or any other provisions of this Agreement invalid, illegal, or unenforceable in any other jurisdiction.  If any covenant should be deemed invalid, illegal, or unenforceable because its scope is considered excessive, such covenant will be modified so that the scope of the covenant is reduced only to the minimum extent necessary to render the modified covenant valid, legal, and enforceable.

12.11.  09A..  This Agreement shall be administered, interpreted and construed in a manner that does not result in the imposition of additional taxes or interest under Section 409A of the Internal Revenue Code of 1986, as amended (the "Code").  If any amount to be paid to the Executive on account of his separation of service while he is a "specified employee" (as defined under Section 409A of the Code) is "deferred compensation" (as defined under Section 409A of the Code, after giving effect to the exemptions hereunder), such amount shall be delayed until the first business day after the lapse of six months after separation of service.

6

IN WITNESS WHEREOF, the parties here to have executed this Agreement as of the date first above written.  

AMERITRANS CAPITAL CORPORATION

By:  

/s/ Gary C. Granoff                         

Gary C. Granoff, Chairman and CFO

ELK ASSOCIATES FUNDING CORPORATION

By:  

/s/ Gary C. Granoff                         

Gary C. Granoff

EXECUTIVE

: /s/ Michael Feinsod                         

Michael R. Feinsod

7

EX-10.2

Exhibit 10.2

FIRST AMENDMENT TO THE AMENDED AND RESTATED EMPLOYMENT

AGREEMENT BETWEEN GARY C. GRANOFF, AMERITRANS CAPITAL CORPORATION AND ELK ASSOCIATES FUNDING CORPORATION

This Amendment (hereinafter referred to as the “Amendment”) is the First Amendment to that certain Amended and Restated Employment Agreement dated as of October 1, 2008, between Gary C. Granoff (“Executive”), Ameritrans Capital Corporation (“Ameritrans”), and Elk Associates Funding Corporation (“Elk”) (collectively, Ameritrans and Elk are hereinafter referred to as the “Employer”, and the said employment agreement is hereinafter referred to as the “Employment Agreement”).  This First Amendment is dated as of this 12^th day of November, 2009.

WHEREAS, Executive and Employer previously entered into the Employment Agreement which is and remains in full force and effect; and

WHEREAS, Executive and Employer desire to amend the Employment Agreement as hereinafter set forth;

NOW, THEREFORE, in consideration of the promises and mutual covenants hereinafter set forth and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows:

1.

The Employment Agreement is presently in full force and effect in accordance with each of the terms set forth in the Employment Agreement.

2.

The fifth sentence of Paragraph 3.1 in the paragraph entitled Duties and Responsibilities is hereby amended by changing the date to which Executive shall continue to serve as the CFO of the Employer.  Presently the date through which Executive has agreed to serve in that capacity is through September 30, 2009.  Executive agrees that he will continue to serve in that capacity through June 30, 2010, provided that Employer may, in its discretion, employ a qualified person to be CFO at any time before June 30, 2010, in which event Executive shall relinquish such duties thereafter without any reduction in compensation.  Notwithstanding the foregoing, Employer shall, not later than June 30, 2010, employ a qualified person to be CFO after which date, Executive shall have no further responsibility to act in the capacity of CFO.

3.

Paragraph 3.1 in the paragraph entitled Duties and Responsibilities is further amended to clarify the manner in which Executive shall devote on average at least 20 hours a week of his business time on behalf of Employer.  In that regard, it is agreed that Executive can perform such service either in the Company’s offices or from outside of the Company’s offices.  Executive shall keep his own separate time records of the time Executive has been available for service from whatever location.  Executive is exempted from any sign in system or “finger print detection system” or other such similar system that the Company may utilize for other executives or employees.  Executive shall schedule an average of two days (15 hours) each week, not including vacation weeks, to be performed on a regularly scheduled basis, and the balance of 5 hours each week shall be performed by Executive being available for t elephone calls from out of the office, and for processing routine emails during the balance of the week.

4.

Paragraph 4.1 Base Salary which is found in Paragraph 4 Compensation and Related Matters is amended as follows:  The third sentence of said paragraph is hereby amended to reflect that Executive has agreed to take a reduction in salary of Forty Thousand Dollars ($40,000.00) during the fiscal year beginning July 1, 2009 and ending June 30, 2010, and that for said period, Executive is taking a deferral of an additional Thirty-Three Thousand Seven Hundred and Twenty Five ($33,725.00) Dollars which will be paid to Executive in the following three fiscal years in equal amounts of $11,241.66 per year.  As such, the third sentence of paragraph 4.1 shall be amended to read:  “Commencing July 1, 2009, and for each fiscal year (July 1 to June 30) during the Employment Period (each such fiscal year, an “Employment Year”) Employer shall pay to Executive a base salary of $391,275 for the first Employment Year (July 1, 2009 through June 30, 2010), $189,241.66 for the second Employment Year (July 1, 2010 through June 30, 2011), $189,241.66 for the third Employment Year (July 1, 2011 through June 30, 2012), and $170,241.66 for the fourth Employment Year (July 1, 2012 through June 30, 2013), (with respect to each Employment Year, the “Base Salary”).

5.

Paragraph 4.3 Other Benefits which is found in Paragraph 4 Compensation and Related Matters is amended and supplemented as follows:  Executive agrees to waive and take a reduction in the contribution to Executive’s SEP IRA account for the period commencing October 1, 2009 through September 30, 2010.  Beginning with SEP IRA contributions that would accrue to Executive beginning October 1, 2010, if Employer does not pay Executive the scheduled contribution of 15% of Executive’s Base Salary, subject to the applicable IRS maximum contribution limits, to the extent Employer chooses not to pay all or any portion of the amount that would be due to Executive, then in such event, Executive’s Base Salary shall be increased for the fiscal year in question by the maximum amount of the SEP IRA payment that would have been paid to Executive based upon the 15% contribution rate, subject to the maximum IRS limitation amount, that is not being paid by Employer, and such increase in Executive’s Base Salary shall be paid to Executive in equal monthly payments as an increase in Executive’s Base Salary, and shall be paid together with and at the same time as payments of the balance of Executive’s Base Salary.

6.

Paragraph 4.8 Life Insurance, is hereby modified so as to assign the William Penn Life Insurance Policy to Executive, immediately upon execution of this First Amendment.  Accordingly, Employer agrees that it hereby assigns to Executive, or Executive’s assigns, all of it’s right, title and ownership interest in and to that certain William Penn Life Insurance Policy # 0700005613 dated May 24, 1993, issued June 2, 1993, free and clear of all liens and encumbrances, and Employer will take any further action requested by Executive in accordance with written instructions from Executive to execute any additional or supplement assignment that may otherwise be necessary on the forms provided by William Penn Life Insurance Company to either Executive’s spouse or a life insurance trust established by Executive.  The assignment herein is inclusive of the current cash account maintained by William Penn Life Insurance Compa ny pertinent to said policy.  Executive, or his assigns shall hereafter be responsible to make all future premium payments that may be due on said policy.  The within assignment shall be deemed to take effect immediately, and the Employer shall have no further obligations under Paragraph 4.8 of the Employment Agreement.

Except as modified herein, each of the other terms, covenants and conditions of the Employment Agreement are hereby ratified and confirmed by Executive and by Employer as being in full force and effect, and as modified by the terms, covenants and conditions of this First Amendment to Employment Agreement.

IN WITNESS WHEREOF,

the parties here to have executed this First Amendment to Employment Agreement as of the date first written above.  

AMERITRANS CAPITAL CORPORATION                          ELK ASSOCIATES FUNDING CORPORATION

BY: /s/ Michael Feinsod                                                            BY: /s/ Michael Feinsod                           

Michael Feinsod, Chief Executive Officer                          Michael Feinsod, Senior Vice Pres.

EXECUTIVE

BY:__/s/ Gary C. Granoff                   

Gary C. Granoff

2

EX-10.3

Exhibit 10.3

FIRST AMENDMENT TO THE AMENDED AND RESTATED EMPLOYMENT

AGREEMENT BETWEEN ELLEN M. WALKER, AMERITRANS CAPITAL CORPORATION AND ELK ASSOCIATES FUNDING CORPORATION

This First Amendment (hereinafter referred to as the “Amendment”) is dated as of November 12, 2009 to the Amended and Restated Employment Agreement dated as of February 21, 2006 (the "Employment Agreement"), between Ellen M. Walker (“Executive”), Ameritrans Capital Corporation (“Ameritrans”), and Elk Associates Funding Corporation (“Elk”) (collectively, Ameritrans and Elk are hereinafter referred to as the “Employer”).  

WHEREAS, Executive and Employer previously entered into the Employment Agreement which is and remains in full force and effect; and

WHEREAS, Executive and Employer desire to amend the Employment Agreement as hereinafter set forth;

NOW, THEREFORE, in consideration of the promises and mutual covenants hereinafter set forth and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows:

1.

The Employment Agreement is in full force and effect in accordance with each of the terms, covenants and conditions as set forth therein.

2.

Paragraph 3, Duties and Responsibilities, is hereby amended by adding the following subparagraph b) as follows:

“b)    Specific Duties.

In addition to the foregoing, during the remaining term of the Employment Agreement, Executive shall devote such of her business time and skills to Employer as may be reasonably required to work on the liquidation and disposition of the “legacy” portfolio of loans of the Employer as directed by Board of Directors.  Executive shall provide regular updates with respect to these matters as requested by the Board of Directors.  Executive shall perform such services together with such other officers of the Employer who are also assigned to work on these matters.”

3.

Paragraph 4, Compensation and Related Matters, paragraph (d),  Other Benefits is amended by adding the following to the end of said paragraph:  

“Executive agrees to waive the contribution by Employer to Executive’s SEP IRA account for the period commencing October 1, 2009 through September 30, 2010.  Beginning with the SEP IRA contribution that would accrue to Executive beginning October 1, 2010, in the event Employer does not pay all or any portion of the scheduled contribution of 15% of Executive’s Base Salary, subject to the applicable IRS maximum contribution limits and the limitations under the plan, then in such event, Executive’s Base Salary shall be increased for the fiscal year in question by the maximum amount of the SEP IRA payment that would have been paid to Executive based upon the 15% contribution rate, subject to the maximum IRS limitation amount and the limitations under the plan, that is not being paid by Employer, and such increase in Executive’s Base Salary shall be paid to Executive in equal monthly payments as an increase in Executive’s Base Salary, and shall be paid together with and at the same time as payments of the Executive’s Base Salary.”

4.

Paragraph 4, Compensation and Related Matters, is further amended by adding the following paragraph (h):

(h) “The Employer hereby acknowledges and agrees that all payments made to Executive for reimbursement, or directly to Mass Mutual Financial Group on account of payment of Executive’s Disability Policy Contract Numbers 009452350; 009547334 and 009550544 (collectively, the "Disability Policies") are hereby ratified and confirmed as having been paid as part of the long term employment benefits due to Executive.  Employer agrees to continue making monthly payments to Mass Mutual Financial Group, or to reimburse Executive for payments made to Mass Mutual Financial Group on account of the Disability Policies during the term of this Employment Agreement.

Except as modified herein, each of the other terms, covenants and conditions of the Employment Agreement are hereby ratified and confirmed by Executive and by Employer as if more fully set forth herein, except as otherwise modified by this Amendment.

IN WITNESS WHEREOF,

the parties here to have executed this First Amendment to Employment Agreement as of the date first written above.  

AMERITRANS CAPITAL CORPORATION

ELK ASSOCIATES FUNDING CORPORATION

By: /s/ Michael Feinsod                                                 By:  /s/ Michael Feinsod_________ _

Michael Feinsod, Chief Executive Officer                   Michael Feinsod, Senior Vice Pres.

EXECUTIVE

By: /s/ Ellen M. Walker                          

Ellen M. Walker

EX-10.4

Exhibit 10.4

FIRST AMENDMENT TO THE AMENDED AND RESTATED EMPLOYMENT

AGREEMENT BETWEEN LEE A. FORLENZA, AMERITRANS CAPITAL CORPORATION AND ELK ASSOCIATES FUNDING CORPORATION

This First Amendment (hereinafter referred to as the “Amendment”) is dated as of November 12, 2009 to the Amended and Restated Employment Agreement dated as of February 21, 2006 (the "Employment Agreement"), between Lee A. Forlenza (“Executive”), Ameritrans Capital Corporation (“Ameritrans”), and Elk Associates Funding Corporation (“Elk”) (collectively, Ameritrans and Elk are hereinafter referred to as the “Employer”).  

WHEREAS, Executive and Employer previously entered into the Employment Agreement which is and remains in full force and effect; and

WHEREAS, Executive and Employer desire to amend the Employment Agreement as hereinafter set forth.

NOW, THEREFORE, in consideration of the promises and mutual covenants hereinafter set forth and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the parties hereto agree as follows:

1.

The Employment Agreement is in full force and effect in accordance with each of the terms, covenants and conditions as set forth therein.

2.

Paragraph 3, Duties and Responsibilities, is hereby amended by adding the following subparagraph b) as follows:

“b)    Specific Duties.

In addition to the foregoing, during the remaining term of the Employment Agreement, Executive shall devote such of his business time and skills to Employer as may be reasonably required to work on the liquidation and disposition of the “legacy” portfolio of loans of the Employer as directed by Board of Directors.  Executive shall provide regular updates with respect to these matters as requested by the Board of Directors.  Executive shall perform such services together with such other officers of the Employer who are also assigned to work on these matters.”

3.

Paragraph 4, Compensation and Related Matters, paragraph (d), Other Benefits, is amended by adding the following to the end of said paragraph:  

“Executive agrees to waive the contribution by Employer to Executive’s SEP IRA account for the period commencing October 1, 2009 through September 30, 2010.  Beginning with the SEP IRA contribution that would accrue to Executive beginning October 1, 2010, in the event Employer does not pay all or any portion of the scheduled contribution of 15% of Executive’s Base Salary, subject to the applicable IRS maximum contribution limits and the limitations under the plan, then in such event, Executive’s Base Salary shall be increased for the fiscal year in question by the maximum amount of the SEP IRA payment that would have been paid to Executive based upon the 15% contribution rate, subject to the maximum IRS limitation amount and the limitations under the plan, that is not being paid by Employer, and such increase in Executive’s Base Salary shall be paid to Executive in equal monthly payments as an increase in Executive’s Base Salary, and shall be paid together with and at the same time as payments of the Executive’s Base Salary.”

Except as modified herein, each of the other terms, covenants and conditions of the Employment Agreement are hereby ratified and confirmed by Executive and by Employer as if more fully set forth herein, except as otherwise modified by this Amendment.

IN WITNESS WHEREOF,              the parties here to have executed this Amendment to Employment Agreement as of the date first written above.  

AMERITRANS CAPITAL CORPORATION              ELK ASSOCIATES FUNDING CORPORATION

By: /s/ Michael Feinsod                                                 By:  /s/ Michael Feinsod_________ _

Michael Feinsod, Chief Executive Officer                   Michael Feinsod, Senior Vice Pres.

EXECUTIVE

By: /s/ Lee A. Forlenza                          

Lee A. Forlenza

EX-99.1

Exhibit 99.1

For Immediate Release

Ameritrans Capital Corporation

For more information Contact:

Michael Feinsod

(212) 355-2449

Ameritrans Capital Corporation Reports First Quarter Fiscal 2010 Results

New York, NY, November 16, 2009 – Ameritrans Capital Corporation (NASDAQ: AMTC, AMTCP) today reported financial results for the quarter ended September 30, 2009.  

Highlights for First Quarter 2009:

* Total investment income for the three months ended September 30, 2009 of $253,758.

* Net unrealized depreciation on investments of approximately $1.9 million, or $0.56 per share, for the first quarter of Fiscal 2010.

* Net asset value per share of $2.52 as of September 30, 2009 compared to $3.40 as of June 30, 2009.

* At September 30, 2009, investment assets totaled $22.96 million as compared to $26.41 million at June 30, 2009.

Operating Results

The Company’s investment income for the three months ended September 30, 2009 decreased $1,205,703, or 83%, to $253,758, as compared to the three months ended September 30, 2008.  The decrease in investment income between the periods can be attributed to lower interest rates charged on the total loan portfolio for the quarter, and an overall decrease in the size of the Company’s loan receivable portfolio due to the sale of substantially all of the Company’s taxicab medallion portfolio.  The recognition of realized loss of interest income of $222,307 which primarily reflected the write off of interest on life settlement investments.

Medallion loans outstanding as of September 30, 2009 decreased by $27,104,846, or approximately 99%, to $318,700, as compared with September 30, 2008.  The interest rate earned on medallion loans decreased in 2009 as compared with the prior year, which coupled with the decline in portfolio size, lead to a decrease in medallion income for the quarter September 30, 2009 of approximately $626,000 as compared to the same period September 30, 2008.  The Company has substantially exited the medallion loan area and no longer intends to report this as a separate category.

Commercial Loans as of September 30, 2009 decreased by $2,588,322, or 20%, to $10,497,013, as compared with September 30, 2008.  This decrease in Commercial Loans outstanding was partially offset by stronger performance in the remaining portfolio, interest rate floors and collection of past due interest.

Corporate Loans outstanding as of September 30, 2009 decreased by $2,589,004, or 19%, to $10,943,000, as compared with the three months ended September 30, 2008.  The interest rate earned on Corporate Loans decreased in the quarter ended September 30, 2009, as compared with the prior year, primarily due to decreases in LIBOR.  This LIBOR decrease was partially offset by higher rates earned on loans originated in this fiscal year, the use of LIBOR “floors” in loan agreements, and further offset by increases in rates on existing loans due to covenant resets.  The decrease in loans outstanding and amortization on other corporate loans was due to a sale of a loan and a fair value adjustment of a loan of approximately $670,000.

Life settlement contracts outstanding decreased by $2,519,296 as of September 30, 2009, or 86%, as compared with the three months ended September 30, 2008.  This investment has stopped accruing interest and a fair value adjustment downward of approximately $2,500,000 has been made to reflect the value of the investment.   The reduction in interest income for the three months ended September 30, 2009 was approximately $87,000 when compared to the prior year.  

Net assets from operations decreased to $2,973,998, for the three months ended September 30, 2009 as compared to $478,606, for the three months ended September 30, 2008.   The decrease in net assets from operations between the periods was attributable primarily to decreases in interest income and increased operating expenses discussed above.  The decrease in assets from operations was also significantly impacted by a reduction in the fair value of certain investments in the Company’s portfolio due to the write down of the Company’s life settlement investments of approximately $1,400,000 and write down of the fair value of a corporate loan of approximately $686,000 to reflect the restructuring of this investment.  The write off of interest income for $220,000 was related to the life settlement investments.  The Company incurred a realized loss on foreclosure and sale of an asset acquired of approximately $212,000.  Dividends for Participating Preferred Stock were not declared for the three months ended September 30, 2009.  For three months ended September 30, 2008 dividends for Participating Preferred Stock were $84,375.

In October, 2009, Elk received written approval from the SBA that it had been granted a commitment for an additional $9,175,000 in SBA long term guaranteed debentures.

Michael Feinsod, further commented, “During the quarter, we continued to manage our existing portfolio.  We now have a loan portfolio that is substantially comprised of commercial and corporate loans.  With our recently announced commitment for additional SBA guaranteed debentures, we plan to resume the growth of our loan portfolio.  The current credit markets provide us a large number of opportunities to consider for new investment.  New loans continue to have terms, structure and pricing in our favor.  We plan to continue the prudent and selective growth of our corporate and commercial loan portfolios.”

Mr. Feinsod continued “We continue to pursue methods to expand our loan portfolio. We believe that we can continue to build a portfolio of primarily senior loans that will allow us to capitalize on Ameritrans' unique corporate structure. We will continue to focus on less volatile lower risk senior loans as opposed to second-lien and mezzanine investments which we believe will provide the foundation for steady returns to the Company and its shareholders.”

ABOUT AMERITRANS CAPITAL CORPORATION

Ameritrans Capital Corporation is an internally managed, closed-end investment company that has elected to be regulated as a business development company (“BDC”) under the Investment Company Act of 1940, as amended.  Ameritrans originates, structures and manages a portfolio of secured business loans and selected equity investments. Ameritrans' wholly owned subsidiary Elk Associates Funding Corporation is licensed by the United States Small Business Administration as a Small Business Investment Company (SBIC).  The Company maintains its offices at 747 Third Avenue, 4th Floor, New York, NY 10017.

FORWARD-LOOKING STATEMENTS

Statements included herein may constitute “forward-looking statements,” which relate to future events or our future performance or financial condition.  These statements are not guarantees of future performance, condition or results and involve a number of risks and uncertainties.  Actual results and condition may differ materially from those in the forward-looking statements as a result of a number of factors, including those described from time to time in our filings with the Securities and Exchange Commission.  Ameritrans Capital undertakes no duty to update any forward-looking statements made herein.

AMERITRANS CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES

ASSETS

	September 30, 2009	June 30, 2009
	(unaudited)
Assets
Investments at fair value (cost of $27,217,443 and $28,769,396, respectively):
Non-controlled/non-affiliated investments	$         21,636,570	$ 25,080,451
Non-controlled affiliated investments	711,000	711,000
Controlled affiliated investments	609,627	618,017
Total investments at fair value	22,957,197	26,409,468
Cash and cash equivalents	1,193,643	885,434
Accrued interest receivable	373,328	540,213
Assets acquired in satisfaction of loans	28,325	28,325
Furniture, equipment and leasehold improvements, net	125,073	130,217
Deferred loan costs, net	135,986	146,096
Prepaid expenses and other assets	298,515	146,403
Total assets	$  25,112,067	$ 28,286,156

AMERITRANS CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF ASSETS AND LIABILITIES

LIABILITIES AND NET ASSETS

	September 30, 2009	June 30, 2009
Liabilities and Net Assets	(unaudited)
Liabilities:
Debentures payable to SBA	$ 12,000,000	$      12,000,000
Notes payable, banks	370,000	370,000
Accrued expenses and other liabilities	519,416	562,149
Accrued interest payable	51,357	210,165
Total liabilities	12,940,773	13,142,314
Commitments and contingencies (Notes 2, 3, 4 and 8)
Net Assets:
Preferred stock 9,500,000 shares authorized, none issued or outstanding	-	-
9-3/8% cumulative participating redeemable preferred stock $.01 par value, $12.00 face value, 500,000 shares authorized; 300,000 shares issued and outstanding	3,600,000	3,600,000
Common stock, $.0001 par value; 45,000,000 shares authorized, 3,405,583 shares issued; 3,395,583 shares outstanding	341	341
Deferred compensation (Note 8)	(27,716)	(29,166)
Stock options outstanding (Note 8)	191,040	191,040
Additional paid-in capital	21,139,504	21,139,504
Losses and distributions in excess of earnings	(8,401,629)	(7,327,949)
Net unrealized depreciation on investments	(4,260,246)	(2,359,928)
Total	12,241,294	15,213,842
Less:  Treasury stock, at cost, 10,000 shares of common stock	(70,000)	(70,000)
Total net assets	12,171,294	15,143,842
Total liabilities and net assets	$ 25,112,067	28,286,156
Net asset value per common share	$        2.52	$        3.4

AMERITRANS CAPITAL CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS

	For the three months ended
	September 30, 2009	September 30, 2008
Investment income:	(unaudited)	(unaudited)
Interest on loans receivable:
Non-controlled/non-affiliated investments	$          237,524	$ 1,344,537
Non-controlled affiliated investments	-	4,280
Controlled affiliated investments	11,853	30,095
	249,377	1,378,912
Fees and other income	4,381	80,549
Total investment income	253,758	1,459,461
Expenses:
Interest	166,260	487,279
Salaries and employee benefits	450,156	483,961
Occupancy costs	74,875	74,035
Professional fees	253,838	434,934
Directors fees and expenses	30,798	32,017
Other administrative expenses	125,118	246,068
Total expenses	1,101,045	1,758,294
Net investment loss	(847,287)	(298,833)
Net realized gains (losses) on investments:
Non-controlled/non-affiliated investments	(226,394)	13,148
Non-controlled affiliated investments	-	-
Controlled affiliated investments	-	8,315
	(226,394)	21,463
Net unrealized depreciation on investments	(1,900,317)	(201,236)
Net realized/unrealized losses on investments	(2,126,711)	(179,773)
Net decrease in net assets from operations	(2,973,998)	(478,606)
Distributions to preferred shareholders	-	(84,375)
Net decrease in net assets from operations available to common shareholders	$    (2,973,998)	$      (562,981)
Weighted Average Number of Common Shares Outstanding:
Basic and diluted	3,395,583	3,395,583
Net Decrease in Net Assets from Operations Per Common Share:
Basic and diluted	$             (0.88)	$             (0.16)