SECURED CONVERTIBLE PROMISSORY NOTE

Convertible Promissory Note

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This Convertible Promissory Note involves

FIRST MONTAUK FINANCIAL CORP

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Title: SECURED CONVERTIBLE PROMISSORY NOTE
Governing Law: Illinois Date: 5/9/2008
Industry: Investment Services Sector: Financial

Exhibit 4.8.2

FIRST MONTAUK FINANCIAL CORP.

(a New Jersey corporation)

SECURED CONVERTIBLE PROMISSORY NOTE

(the "Note")

THESE SECURITIES HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS

AMENDED (THE "1933 ACT"), OR UNDER ANY APPLICABLE STATE SECURITIES LAWS. THESE

SECURITIES HAVE BEEN ACQUIRED SOLELY FOR INVESTMENT AND NOT WITH A VIEW TO, OR

IN CONNECTION WITH, THE SALE OR DISTRIBUTION THEREOF. THEY MAY NOT BE SOLD,

OFFERED FOR SALE, TRANSFERRED, PLEDGED, OR HYPOTHECATED IN THE ABSENCE OF AN

EFFECTIVE REGISTRATION STATEMENT RELATED THERETO OR PURSUANT TO AN AVAILABLE

EXEMPTION FROM REGISTRATION UNDER THE 1933 ACT AND IN ACCORDANCE WITH APPLICABLE

STATE SECURITIES AND BLUE SKY LAW.

$2,000,000 December 7, 2007

FOR VALUE RECEIVED, First Montauk Financial Corp., a New Jersey

corporation organized under the laws of the State of New Jersey (the "Company"),

promises to pay to the order of AEFC FMFK Investment Corp., a Delaware

corporation (the "Holder"), the principal sum of Two Million Dollars

($2,000,000), or such lesser principal sum as may be then owed by the Company to

the Holder, in legal and lawful money of the United States of America, together

with interest from the date hereof on the principal amount from time to time

remaining unpaid as provided below. Payment for all amounts due hereunder shall

be made at the principal office of the Holder at the address of the Holder set

forth in the Purchase Agreement (as hereinafter defined), or such other address

as the Holder may hereafter direct in writing.

The following is a statement of the rights of the Holder of this Note

and the conditions to which this Note is subject, and to which the Holder

hereof, by the acceptance of this Note, agrees:

1. Initial Funding. By acceptance of this Note, the Holder hereby agrees to lend

to the Company on the terms and conditions set forth herein, (i) $1,000,000 on

the date hereof and (ii) such additional sums as the Company may request from

time to time up to an aggregate outstanding amount hereunder of $2,000,000. On

the date hereof, the Holder shall make available to the Company in immediately

available funds, the amount of $1,000,000 by depositing such funds in such

account designated by Company.

2. Draw Requests. During the period commencing on February 1, 2008 and ending on

June 30, 2008, the Company may from time to time borrow additional amounts

available under this Note by sending the Holder a written notice (a "Draw

Notice") setting forth the amount of funds the Company desires to borrow. The

Draw Notice shall state the amount of the requested draw, which shall be in

increments of $250,000, and shall set forth the wire transfer instructions

necessary to transmit the funds into the account specified by the Company. The

Draw Notice shall be accompanied by a certificate of the chief financial officer

of the Company certifying to the Holder that, as of the date of the Draw Notice,

(a) the representations and warranties made by the Company in the Note Purchase

Agreement dated of even date herewith between the Company and Holder, and

attached hereto as Exhibit A (the "Purchase Agreement"), are true and correct in

all material respects, (b) no Event of Default, as defined in the Purchase

Agreement, has occurred and is continuing or would be caused by such advance,

and (c) there is no event or condition which with notice or the lapse of time,

or both, would give rise to an Event of Default, as defined in the Purchase

Agreement.

3. Funding. Subject to availability under this Note, within ten (10) business

days of receiving a Draw Notice, the Holder shall make available to the Company,

in immediately available funds, the amount requested in the Draw Notice, by

depositing such funds in the account designated by Company. Each date on which

Holder deposits funds into an account designated by the Company under this

Agreement shall be referred to as a "Funding Date."

4. Principal Repayment/Maturity Date. Unless this Note is prepaid or converted

as provided herein, the unpaid principal amount of this Note shall be due and

payable in one lump sum on December 31, 2008 (the "Maturity Date").

5. Interest. This Note shall bear simple interest at the per annum rate of ten

percent (10%) on the unpaid principal balance of this Note commencing on the

date of this Note until paid in full. Accrued and unpaid interest on the Note

shall be payable monthly on or before the tenth (10th) day of each month,

commencing on the tenth (10th) day of the month following the interest accrual,

and on the Maturity Date. All past due principal and interest shall bear

interest from maturity until paid at the rate of fifteen percent (15%). Payments

received hereunder shall be applied first to accrued and unpaid interest and

then to the unpaid principal balance of this Note.

<PAGE>

6. Pledge Agreement; Events of Default. All sums due hereunder are secured by

that certain Stock Pledge Agreement dated of even date herewith between the

Company and Holder, and attached hereto as Exhibit B (the "Pledge Agreement").

If any Event of Default (as defined in the Purchase Agreement) shall occur and

be continuing, the Holder shall have the rights and remedies set forth in the

Pledge Agreement and the Purchase Agreement, in addition to the Holder's rights

of conversion under Section 10 of this Note as to all of the principal and

interest then due and owing.

7. FINRA Notice. If at any time this Note is (or will be as a result of a

requested draw) convertible in accordance with the provisions of Section 10

hereof into a number of Conversion Shares comprising twenty-five percent (25%)

or more of the equity of the Company, as defined pursuant to FINRA Rule

1017(a)(4), the Company shall promptly provide written notice (the "FINRA

Notice") to the Holder. After the Holder's receipt of such notice, the Company

shall act diligently and reasonably, and the Holder shall cooperate with the

Company, to secure the approval of the Financial Industry Regulatory Authority

("FINRA") relating to the Holder's potential ability to acquire in excess of

twenty-five percent (25%) as required under Rule 1017 of the rules of the NASD

Manual, as adopted by FINRA (the "FINRA Approval"), and any other consents and

approvals of FINRA, any self regulatory organization or any governmental

authority. The Company shall file all applications necessary and appropriate to

obtain FINRA Approval within thirty (30) days after the Holder's receipt of the

FINRA Notice.

In the event that FINRA denies the FINRA Approval, the Company, within

ten (10) business days of receipt of the notice of such denial, shall pay down

such principal amount owed to the Holder pursuant to this Note as is necessary

to cause the number of Conversion Shares available to the Holder upon conversion

of all or part of this Note in accordance with the provisions of Section 10

hereof to fall below twenty-five percent (25%) of the equity of the Company (the

"FINRA Repayment"). Prepayment penalties payable by the Company because of the

FINRA Repayment, if any, are set forth in Section 8 hereof.

8. Prepayment.

8.1 Prepayment Penalty. The Company shall have the right to prepay the

outstanding principal and interest owed to the Holder pursuant to this

Note in full, and not in part, except as provided in Section 8.2

hereof, at any time prior to July 1, 2008 by delivering to the Holder

(i) payment, by wire transfer of immediately available funds, to an

account designated by the Holder in an amount equal to the sum of (A)

the entire principal and accrued interest owed by the Company to the

Holder as of the date of such prepayment plus (B) the product of (1)

the Prepayment Penalty, as determined in accordance with the following

table below, multiplied by (2) the Loan Factor (as defined below). In

addition, the Company shall deliver to the Holder a warrant to

purchase, at a price of $0.35 per share, the number of no par value

common stock of the Company (the "Common Stock") equal to the product

of (A) the number of shares of Common Stock set forth in the Prepayment

Warrant column of the following table below, multiplied by (B) the Loan

Factor. Any warrant issued pursuant to this Section 8.1 will be in the

form attached hereto as Exhibit C (a "Prepayment Warrant").

<PAGE>

<TABLE>

------------------------- ------------------------ ----------------------- -------------------------

From To Prepayment Penalty Prepayment

Warrants

------------------------- ------------------------ ----------------------- -------------------------

The date hereof January 31, 2008 $400,000 None

------------------------- ------------------------ ----------------------- -------------------------

February 1, 2008 February 29, 2008 $420,000 400,000

------------------------- ------------------------ ----------------------- -------------------------

March 1, 2008 March 31, 2008 $440,000 800,000

------------------------- ------------------------ ----------------------- -------------------------

April 1, 2008 April 30, 2008 $460,000 1,200,000

------------------------- ------------------------ ----------------------- -------------------------

May 1, 2008 May 31, 2008 $480,000 1,600,000

------------------------- ------------------------ ----------------------- -------------------------

June 1, 2008 June 30, 2008 $500,000 2,000,000

------------------------- ------------------------ ----------------------- -------------------------

July 1, 2008 Maturity Date Not prepayable Not prepayable without

without the Holder's the Holder's consent.

consent.

------------------------- ------------------------ ----------------------- -------------------------

</TABLE>

For purposes of this Section 8.1, the "Loan Factor" shall be equal to

the quotient obtained by dividing the numerator of (A) the total amount

of all outstanding principal owed by the Company to the Holder

immediately prior to prepayment pursuant to this Section 8.1, by the

denominator of (B) 2,000,000. By way of example, if $1,500,000 of

outstanding principal were owed by the Company to the Holder

immediately prior to prepayment, the Loan Factor would be 0.75

(1,500,000 divided by 2,00,000).

After June 30, 2008, the Company will not be permitted to prepay the

outstanding principal and interest owed to the Holder pursuant to this

Note, in whole or in part, without the consent of the Holder, except as

set forth in Section 8.2 hereof.

8.2 Prepayment Penalty for FINRA Repayment. No partial prepayments of the

outstanding principal balance of this Note will be permitted, except as

provided in this Section 8.2. In the event that the Company is required

to make the FINRA Repayment to the Holder prior to June 30, 2008, the

Company shall deliver to the Holder the prepayment penalties that the

Company would have delivered to the Holder, as calculated pursuant to

Section 8.1 hereof, if the Company had prepaid the outstanding

principal and interest owed to the Holder pursuant to this Note in full

on the date of the FINRA Repayment. In the event that the Company is

required to make the FINRA Repayment to the Holder on or after June 30,

2008, the Company shall deliver to the Holder the prepayment penalties

that the Company would have delivered to the Holder, as calculated

pursuant to Section 8.1 hereof, if the Company had prepaid the

outstanding principal and interest owed to the Holder pursuant to this

Note in full on June 30, 2008. For purposes of calculating the Loan

Factor with respect to a FINRA Repayment, the numerator shall equal the

amount of the FINRA Repayment. Notwithstanding the foregoing provisions

of this Section 8.2, in the event that FINRA denies the FINRA Approval

based solely on the actions or inaction of the Holder, the Holder shall

not be entitled to any prepayment penalties associated with the FINRA

Repayment.

<PAGE>

9. Contingent Warrant. On July 1, 2008, in the event that (i) the Company has

not drawn down the entire amount available under this Note and (ii) the Company

has not prepaid the outstanding principal and interest owed to the Holder

pursuant to this Note in full, the Company shall issue the Holder a warrant to

purchase a number of shares of Common Stock, at a price of $0.35 per share, as

determined in accordance with the following table:

---------------------------------------- --------------------------------

Amount Not Drawn by the Company Number of Warrants to be

Issued to the Holder

---------------------------------------- --------------------------------

$1,000,000 4,000,000

---------------------------------------- --------------------------------

$750,000 3,000,000

---------------------------------------- --------------------------------

$500,000 2,000,000

---------------------------------------- --------------------------------

$250,000 1,000,000

---------------------------------------- --------------------------------

$0 0

---------------------------------------- --------------------------------

Any warrant issued pursuant to this Section 9 will be in the form

attached hereto as Exhibit D (a "Contingent Warrant").

10. Conversion.

10.1 Voluntary Conversion. Any Holder of this Note has the right, at the

Holder's option, exercisable at any time during the period commencing

on July 1, 2008 and ending on the Maturity Date, to convert this Note

in accordance with the provisions of Section 10.2 hereof, in whole or

in part, into fully paid and nonassessable shares of the Common Stock.

The number of shares of Common Stock of the Company into which this

Note may be converted ("Conversion Shares") shall be determined by

dividing the outstanding principal amount elected by the Holder to be

converted by the Conversion Price (as defined below) in effect at the

time of such conversion. The initial Conversion Price shall be equal to

$0.35 per share (the "Conversion Price").

10.2 Conversion Procedure. The Holder may convert this Note as provided

herein by delivering to the Company a Notice of Exercise (attached

hereto as Exhibit E) to the Company at its principal corporate office.

The Company shall, as soon as practicable, thereafter, and at its

expense, issue and deliver at such office to the Holder of this Note a

certificate or certificates representing the Conversion Shares. The

Holder acknowledges that the certificates for the Conversion Shares

will be legended, if and as required by applicable state and federal

securities laws. Such conversion shall be deemed to have been made

immediately prior to the close of business on the date the Company

receives the Notice of Exercise, and the person or perso

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