Summary of JMP GROUP INC. - Yahoo! Finance

Entry into a Material Definitive Agreement, Creation of a Direct Financial Obligat

Item 1.01. Entry in to a Material Definitive Agreement

On January 25, 2013, JMP Group Inc. (the "Company") completed its previously announced offering of $46.0 million, in the aggregate, of the Company's 8.00% Senior Notes due 2023 (the "Notes"), which includes an additional $6.0 million of Notes purchased pursuant to the full exercise of the overallotment option. The Notes were sold pursuant to an effective Registration Statement on Form S-3 (File No. 333-183619) filed with the Securities and Exchange Commission on August 29, 2012 (the "Registration Statement"), and a related prospectus and prospectus supplement filed with the Securities and Exchange Commission, and were issued pursuant to the First Supplemental Indenture (the "First Supplemental Indenture"), dated as of January 25, 2013, by and between the Company and U.S. Bank National Association, as trustee (the "Trustee"). The First Supplemental Indenture supplements the Indenture entered into by and between the Company and the Trustee, dated as of January 24, 2013 (the "Base Indenture" and, together with the First Supplemental Indenture, the "Indenture").

The Notes bear interest at the rate of 8.00% per annum. Interest on the Notes is payable quarterly in arrears on January 15, April 15, July 15 and October 15, commencing on April 15, 2013. The Notes will mature on January 15, 2023.

The Company may, at its option, at any time and from time to time, on or after January 15, 2016, redeem the Notes in whole or in part on not less than 30 nor more than 60 days' prior notice mailed to the holders of the Notes. The Notes will be redeemable at a redemption price equal to 100% of the principal amount of the Notes plus accrued and unpaid interest to the date of redemption. On and after any redemption date, interest will cease to accrue on the redeemed Notes. If the Company is redeeming less than all of the Notes, the Trustee will select the Notes to be redeemed by such method as the Trustee deems fair and appropriate in accordance with methods generally used at the time of selection by fiduciaries in similar circumstances.

The Indenture contains a minimum liquidity covenant, which obligates the Company to maintain Liquidity (as defined therein) of at least an amount equal to the lesser of (i) the aggregate amount due on the next eight scheduled quarterly interest payments on the Notes, or (ii) the aggregate amount due on all remaining scheduled quarterly interest payments on the Notes until the maturity of the Notes.

The Indenture also contains customary event of default and cure provisions. If an uncured default occurs and is continuing, the Trustee or the holders of at least 25% in principal amount of the Notes may declare the Notes to be immediately due and payable.

The public offering price of the Notes was 100.0% of the principal amount (i.e., $46 million). The Company will receive net proceeds after discounts and commissions, but before expenses, of approximately $44.6 million and will use such proceeds for general corporate purposes.

The foregoing description of the Base Indenture, First Supplemental Indenture and the Notes does not purport to be complete and is qualified in its entirety by reference to the full text of the Base Indenture, First Supplemental Indenture and the form of Note, copies of which are attached to this Current Report on Form 8-K as Exhibits 4.1, 4.2 and 4.3, respectively, and are incorporated herein by reference and into the Registration Statement.