INTERCREDITOR/SUBORDINATION AGREEMENT
 
THIS INTERCREDITOR/SUBORDINATION AGREEMENT (the “Agreement”), dated as of June
5, 2008, by and among FCS Financial, PCA (“Lender”); the persons loaning funds
to Borrower pursuant to the Purchase Agreement; a list of which is attached
hereto as Exhibit A (each a “Subordinate Creditor” and collectively,
“Subordinate Creditors”); and Show Me Ethanol, LLC (“Borrower”).
 
ARTICLE I
DEFINITIONS
 
SECTION 1.01. Definitions. As used herein, the following terms shall have the
meanings specified below:
 
“Agent” shall mean State Bank of Slater or such other agent serving as Agent
under the Subordinated Loan Documents on behalf of all Subordinate Creditors.
 
“Collateral” has the meaning specified in the Senior Loan Documents between
Borrower and Lender.
 
“Default” shall mean any Event of Default specified in the Senior Loan Documents
or under the Subordinated Loan Documents, or any other event that, with the
giving of notice or lapse of time or both, would constitute an Event of Default
under the Senior Loan Documents or the Subordinated Loan Documents.
 
“Leasehold Deed of Trust” shall mean that Missouri Leasehold Deed of Trust,
Assignment of Rents and Security Agreement by and among the trustee named
therein and Borrower as Grantor.
 
“Lender” shall mean FCS Financial, PCA, and any other holder from time to time
of the Senior Debt.
 
“Insolvency Event” shall have the meaning given to such term in Section 3.02(a)
this Agreement.
 
“Notes” shall mean all notes of Borrower payable to Lender evidencing all or
part of the Senior Debt, and any amendments, modifications, renewals or
extensions thereof.
 
“Promissory Notes” shall mean the 9% subordinated secured notes issued by
Borrower on the date hereof.
 
“Purchase Agreement” shall mean that Purchase Agreement by and among Borrower as
Promissory Note issuer and the individuals listed on Exhibit A hereto, dated the
date hereof.
 
“Senior Debt” shall mean all obligations of Borrower to Lender now or hereafter
existing under the Senior Loan Documents, whether for principal or interest
(including interest accruing after the occurrence of an Insolvency Event), and
whether or not the same is allowed as a claim, prepayment premium, fees,
expenses or otherwise.
 

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“Senior Loan Agreements” shall mean that certain Construction and Term Loan
Agreement by and among Borrower, Lender, as administrative agent, and the Banks
named therein, dated as of March 1, 2007 and that certain Revolving Credit
Agreement by and between Borrower and Lender dated November 6, 2007.
 
“Senior Loan Documents” shall mean the Senior Loan Agreements, the Note, the
Deed of Trust, and all other instruments and documents executed and delivered by
Borrower, as amended from time to time, and any renewal and extensions thereof,
with respect to the Senior Debt.
 
“Subordinate Loan Agreement” shall mean that certain Loan and Security Agreement
by and among Subordinate Creditors and Borrower, dated the same date as of this
Agreement;
 
“Subordinate Loan Documents” shall mean the Subordinate Loan Agreement,
Promissory Notes, the Leasehold Deed of Trust and the Purchase Agreement, and
all other instruments and documents executed and delivered by Borrower, as
amended from time to time, and any renewal and extensions thereof, with respect
to the Subordinated Debt.
 
“Subordinated Debt” shall mean all obligations of Borrower to the Subordinate
Creditors, due to loans or other extensions of credit by the Subordinate
Creditor to Borrower, however arising or created, whether now existing or
hereafter arising, and whether represented by promissory notes of Borrower or
shown on the books and records of the Borrower.
 
ARTICLE II
REPRESENTATIONS OF SUBORDINATE CREDITOR
 
SECTION 2.01. Representations and Warranties. Subordinate Creditors hereby
represent and warrant to Lender as follows:
 
(a) Attached hereto as Exhibit A, and made a part hereof by this reference, is a
full and complete list of the Subordinate Creditors, each of which as of the
date of this Agreement is a holder of the Borrower’s issued 9% subordinated
secured Promissory Notes. There are no existing agreements or understandings
relating to the Subordinated Debt between Borrower and the Subordinate Creditors
that are not fully and accurately described in the Subordinate Loan Documents.
 
(b) This Agreement has been duly executed and delivered by the Subordinate
Creditors, and is the valid and binding obligation of each Subordinate Creditor,
enforceable against it in accordance with its terms.
 
(c) Except for Subordinate Creditor’s membership interest in Borrower, the
Subordinate Creditor does not currently hold any notes, evidences of
indebtedness or shares of preferred stock, nor does it claim any right (whether
or not contingent) to payment of money from Borrower, other than the
Subordinated Debt.
 
(d) By execution of the Purchase Agreement, Subordinate Creditors have each
approved and agreed to be bound by the terms of this Agreement and each has
authorized the Agent to execute this Agreement on behalf of the Subordinate
Creditors.
 
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ARTICLE III
SUBORDINATION TO SENIOR DEBT
 
SECTION 3.01. Subordination.
 
(a) General. Except as provided herein, Subordinate Creditor agrees and
covenants that the Subordinated Debt is and shall be subordinate in right of
payment to the prior payment in full of the Senior Debt. The Senior Debt shall
not be deemed to have been paid in full until Lender shall have received
indefeasible payment of the Senior Debt.
 
(b) Permitted Payments. Except as otherwise provided in this Article III, prior
to the occurrence of a Default (of which Agent and Subordinate Creditors have
been provided written notice), the Subordinate Creditor shall only be entitled
to receive interest payments on the Subordinated Debt in accordance with the
terms of the Subordinate Loan Documents. Additionally, nothing in this Agreement
shall be construed to prohibit Borrower's ability to make pre-payments on the
Subordinated Debt from additional capital contributions made to Borrower after
the date hereof; provided, however, Borrower shall not be allowed to make
prepayments from working capital or cash flow without the express written
consent of Lender.
 
SECTION 3.02. Priority and Payment Over of Proceeds in Certain Events.
 
(a) Insolvency or Dissolution of Borrower. Upon any payment or distribution of
all or any of the assets or securities of Borrower of any kind or character,
whether in cash, property or securities, upon any dissolution, winding up,
liquidation, reorganization, arrangement, adjustment, protection, relief or
composition of Borrower or its debts, whether voluntary or involuntary or in
bankruptcy, insolvency, receivership, arrangement, reorganization, relief or
other proceedings, or upon an assignment for the benefit of creditors or any
other marshalling of the assets and liabilities of Borrower or otherwise (any
such event being an “Insolvency Event”), all Senior Debt shall first be
indefeasibly paid in full before the Subordinate Creditor shall be entitled to
receive any payment of the Subordinated Debt. Upon the occurrence of any
Insolvency Event, any payment or distribution of assets or securities of
Borrower of any kind or character, whether in cash, property or securities, to
which Subordinate Creditor would be entitled, except for the provisions of this
Article III, shall be made by Borrower or by any receiver, trustee in
bankruptcy, liquidating trustee, agent or other person making such payment or
distribution, directly to Lender for application (in the case of cash) to or as
collateral (in the case of non-cash property or securities) for the payment or
prepayment in full, first, of all Senior Debt after giving effect to any
concurrent payment or distribution to Lender on the Senior Debt.
 
(b) Default under Senior Loan Agreements. No direct or indirect payment of the
Subordinated Debt shall be made by Borrower or received by a Subordinate
Creditor if, at the time of such payment, there exists any Default (of which
Subordinate Creditor has been provided notice through Agent or otherwise prior
to any such payment) and such Default shall not have been cured or waived in
writing by Lender or the benefits of this sentence waived in writing by Lender.
Lender shall notify Agent (on behalf of the Subordinate Creditors) in writing of
any default under the Senior Loan Documents. Notwithstanding the foregoing,
Subordinate Creditor (or the Agent acting on behalf of Subordinate Creditors)
shall be entitled to receive and retain any payments that Subordinate Creditor
(or the Agent acting on behalf of Subordinate Creditors) has received in payment
of the Subordinate Debt pursuant to the terms of the Agreement or by consent of
Lender prior to the receipt by Agent of the foregoing written notice from
Lender.
 
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(c) Demand for or Acceleration of Payment of Subordinated Debt. In the event
that the Subordinated Debt is declared due and payable or the maturity thereof
is accelerated for any reason, then and in such event, Lender shall be entitled
to receive payment in full of all amounts due or to become due on the Senior
Debt (whether or not a Default or event of default has occurred thereunder or
such Senior Debt is, or has been declared to be, due and payable prior to the
date on which it otherwise would have become due and payable) before Subordinate
Creditor shall be entitled to receive any payment of the Subordinated Debt.
Notwithstanding the foregoing, Subordinate Creditor (or the Agent acting on
behalf of Subordinate Creditors) shall be entitled to receive and retain any
payments that Subordinate Creditor (or the Agent acting on behalf of Subordinate
Creditors) has received in payment of the Subordinate Debt pursuant to the terms
of the Agreement or by consent of Lender prior to the receipt by Agent of the
foregoing written notice from Lender.
 
(d) Certain Payments Held in Trust. In the event that, notwithstanding the
foregoing provisions prohibiting such payment or distribution, Subordinate
Creditor shall have received any payment or distribution in respect of the
Subordinated Debt contrary to such provisions, then and in such event such
payment or distribution shall be received and held in trust for Lender and shall
be paid over or delivered to Lender for application (in the case of cash) to or
as collateral (in the case of non-cash property or securities) for the payment
or prepayment, first, of all Senior Debt in full after giving effect to any
concurrent payment or distribution to Lender in respect of the Senior Debt.
 
SECTION 3.03. Suspension of Remedies. Except as provided in Sections 3.02(a) or
(b), and during any period of payment subordination provided for in Section
3.02(a) or (b), Subordinate Creditor shall not (i) ask, demand, or sue for any
payment, distribution or any other remedy in respect of the Subordinated Debt,
or (ii) commence, or join with any other creditor (other than Lender) in
commencing, any Insolvency Event.
 
SECTION 3.04. Rights of Lender Not to be Impaired. No right of Lender to enforce
subordination as herein provided shall at any time in any way be prejudiced or
impaired by any act or failure to act in good faith by Lender, or by any
noncompliance by Borrower, with the terms and provisions and covenants herein,
regardless of any knowledge thereof Lender may have or otherwise be charged
with. The provisions of this Article III are intended to be for the benefit of,
and shall be enforceable directly by, Lender.
 
SECTION 3.05. Cross Default between Senior Loan Documents and Subordinate Loan
Documents. Lender shall provide in the Senior Loan Documents that a default in
the Subordinate Loan Documents will create a default under the Senior Loan
Documents. Subordinate Creditor shall provide in the Subordinate Loan Documents
that a default in the Senior Loan Documents will create a default under the
Subordinate Loan Documents.
 
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SECTION 3.06. Further Assurances. Subordinate Creditor will take reasonable
steps to mark its books of account in such a manner as shall be effective to
give proper notice of the effect of this Subordination Agreement, and will, in
the case of any Subordinated Debt which is evidenced by any instrument, upon
Lender’s reasonable request cause such Subordinated Debt to be evidenced by an
appropriate instrument or instruments endorsed with a legend evidencing this
Agreement. Subordinate Creditor will, at its reasonable expense and at any time
and from time to time, promptly execute and deliver all further instruments and
documents, and take all further action, that may be necessary or desirable, or
that Lender may reasonably request, in order to protect any right or interest
granted or purported to be granted hereby or to enable Lender to exercise and
enforce its rights and remedies hereunder.
 
SECTION 3.07. Miscellaneous.
 
(a) All rights and interests of Lender under this Article III, and all
agreements and obligations of the Subordinate Creditor under this Article III,
shall remain in full force and effect irrespective of:
 
(i) any lack of validity or enforceability of any Senior Loan Document, and Note
or any other agreement or instrument relating thereto or to any other Senior
Debt;
 
(ii) any change in the time, manner or place of payment of, or in any other term
of, all or any of the Senior Debt, or any other amendment or waiver of or any
consent to departure from any Senior Loan Document any Note or any other
agreement or instrument relating thereto or to the Senior Debt;
 
(iii) any exchange, release or non-perfection of any collateral, or any release
or amendment or waiver of or consent to departure from any guaranty, for all or
any of the Senior Debt; or
 
(iv) any other circumstance that might otherwise constitute a defense available
to, or a discharge of, Borrower or a subordinated creditor.
 
(b) The provisions of this Article III shall continue to be effective or be
reinstated, as the case may be, if at any time any payment of any of the Senior
Debt is rescinded or must otherwise be returned by Lender, as the case may be,
upon the insolvency, bankruptcy or reorganization of Borrower or otherwise, all
as though such payment had not been made.
 
(c) Except for any notice of default issued by Lender concerning the Senior Loan
Documents and those other notices to be provided under Section 3.01(b) and
Section 3.02(b) and (c) above, the Subordinate Creditor hereby waives
promptness, diligence, notice of acceptance and any other notice with respect to
any of the Senior Debt and this Article III and any requirement that Lender
protect, secure, perfect or insure any security interest or lien or any property
subject thereto or exhaust any right or take any action against Borrower or any
other person or entity or any Collateral.
 
(d) No failure on the part of Lender 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. The remedies herein provided are
cumulative and not exclusive of any remedies provided by law.
 
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(e) The provisions of this Article III constitute a continuing agreement and
shall (i) remain in full force and effect until the Senior Debt shall have been
indefeasibly paid in full, (ii) be binding upon Subordinate Creditor and his
heirs, personal representatives, successors and assigns, and (iii) inure to the
benefit of and be enforceable by Lender and its successors, transferees and
assigns. Without limiting the generality of the foregoing clause (iii), Lender
may assign or otherwise transfer any Note or portion thereof held by it, or
grant any participation in any of its rights or obligations under the Loan
Documents, to any other person or entity, and such other person or entity shall
thereupon become vested with all the rights in respect thereof granted to Lender
herein or otherwise.
 
ARTICLE IV
COVENANTS
 
SECTION 4.01. Covenants of Subordinate Creditor. Subordinate Creditor covenants
and agrees with Lender that, unless Lender shall otherwise agree in writing,
prior to the termination of the Senior Loan Documents and payment in full of the
Senior Debt:
 
(a) Subordinate Creditor will not cancel or otherwise discharge any of the
Subordinated Debt (except upon payment as permitted by Article III).
 
(b) Subordinate Creditor will not sell, assign, pledge, encumber or otherwise
dispose of any of the Subordinated Debt held by him unless such sale,
assignment, pledge, encumbrance or disposition is made expressly subject to this
Agreement.
 
(c) Subordinate Creditor will not permit the terms of any of the Subordinated
Debt held by it to be amended or modified in such a manner as to have any
adverse effect upon the rights or interests of Lender hereunder.
 
(d) Except for the Subordinate Loan Documents, Subordinate Creditor will not
secure the payment of any Subordinated Debt or any other obligation of Borrower
to Subordinate Creditor, or obtain a lien, security interest or other charge or
encumbrance of any nature whatsoever against Borrower's property, whether now
owned or hereafter acquired.
 
ARTICLE V
MISCELLANEOUS
 
SECTION 5.01. Amendments, etc. No amendment of any provision of this Agreement
shall in any event be effective unless the same shall be in writing and signed
by Lender and Subordinate Creditor.
 
SECTION 5.02. Waiver. Any waiver of a right provided under this Agreement or a
breach of this Agreement must be express and written. The waiver by either of
the Lender or Subordinate Creditor of any breach of any provision hereof by the
other Party shall not be construed to be a waiver of any succeeding breach of
such provision or a waiver of the provision itself. Selection by Lender or
Subordinate Creditor of a specific remedy does not constitute, and shall not be
interpreted to constitute, a waiver of any other remedy of such party, and
failure to select a specific remedy does not constitute, and shall not be
interpreted to constitute, a waiver of such remedy. Lender’s or Subordinate
Creditor’s failure at any time to enforce any of the terms, provisions or
conditions of this Agreement shall not constitute or be construed as a waiver of
the same and any single or partial exercise by such party of any right under
this Agreement shall not preclude any further or other exercise of the same or
any other right.
 
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SECTION 5.03 Expenses. In the event of any action by either the Lender or the
Subordinate Creditor to enforce any provision of this Agreement, or on account
of any default under or breach of this Agreement, the prevailing party, as
determined by a court of competent jurisdiction, in such action will be entitled
to recover, in addition to all other relief, from the other party all legal fees
incurred by the prevailing party, in connection with such action (including, but
not limited to, any appeal thereof).
 
SECTION 5.04. Addresses for Notices. All notices and other communications
provided for under this Agreement shall be in writing and mailed, faxed, or
delivered at the addresses set forth below, or at such other address as such
party may specify by written notice to the other parties hereto:
 
If to the Borrower:
Show Me Ethanol, LLC
 
807 West Main
 
Post Office Box 158
 
Richmond, Missouri 64085
 
Attention: Greg Thomas
 
Telephone: (816) 776-2291
 
Facsimile: (816) 766-3213
   
With a copy to:
Bryan Cave LLP
 
3500 One Kansas City Place
 
1200 Main Street
 
Kansas City, MO 64105
 
Attention: Dennis Alt
 
Telephone: (816) 374-3200
 
Facsimile: (816) 374-3300
   
If to Subordinate Creditors:
State Bank of Slater
(through Agent)
201 West Maple Street
 
Slater, MO 65349
 
Telephone: 660-529-2222
 
Facsimile:660-529-2660
 
Attention: William “Bud” Summers

 
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If to the Lender:
FCS Financial, PCA
 
Capital Markets Group
 
Three City Place Drive, Suite 870
 
St. Louis, MO 63141
 
Telephone: 314-432-4278
 
Facsimile: 314-567-4678
 
Attention: Lee Fuchs
   
With a copy to:
Husch Blackwell Sanders LLP
 
1949 E. Sunshine St., Suite 2-300
 
Springfield, MO 65804
 
Telephone: (417) 862-6246
 
Facsimile: (417) 862-6948
 
Attention: Gary A. Powell

 
Subordinated Creditors hereby acknowledge and agree that any notice sent to
Agent serves as notice to each and every Subordinate Creditor.
 
SECTION 5.05. Governing Law. This Agreement shall be governed by, and construed
in accordance with, federal law, and to the extent applicable, the internal laws
of the State of Missouri.
 
SECTION 5.06. Execution / Acknowledgement of Agent. This Agreement shall be
deemed executed and accepted by each Subordinate Creditor by its execution of
the Purchase Agreement containing this document as an Exhibit thereto and shall
be executed on behalf of the Subordinate Creditors by execution by the Agent.
Senior Lender, Borrower and each Subordinate Creditor acknowledge and agree that
Agent is executing this Agreement on behalf of Subordinate Creditors, solely as
the agent for Subordinate Creators and not in its individual capacity. Senior
Lender, Borrower and Subordinate Creditors acknowledge and agree that Agent may
act as agent for the Subordinate Creditors in connection with collection and
enforcement of the Subordinate Debt, the signing of instruments on behalf of
Subordinate Creditors, the filing and acting on Subordinate Creditors behalf in
connection with litigation and bankruptcy matters, and otherwise, all in
accordance with the Subordinate Loan Documents. 
 
[Signature page follows]
 
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IN WITNESS WHEREOF, the Subordinate Creditor, Lender and Borrower have caused
this Agreement to be duly executed and delivered by their respective officers
thereunto duly authorized as of the date first above written.
 

 
FCS FINANCIAL, PCA
     
By:
      
Name:
    
Title:
      

“Lender”

 
STATE BANK OF SLATER
     
By:
     
Name:
     
Title:
  

On behalf of the “Subordinate Creditors”
 

 
SHOW ME ETHANOL, LLC
     
By:
     
Name:
     
Title:
    

“Borrower”
 
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EXHIBIT “A”
 
LIST OF SUBORDINATED CREDITORS UPON CLOSING
 
Akeman Farms, Inc.
 
$
20,000
 
Baum Living Trust
 
$
40,000
 
Robert and Dorothy Bell
 
$
30,000
 
Michael and Carolyn Boland
 
$
20,000
 
Rex and Brenda Buhrmester
 
$
20,000
 
Central Missouri BioFuels, LLC
 
$
75,000
 
Harold F. Clark
 
$
30,000
 
David and Karen Durham
 
$
50,000
 
Henry W. Durham
 
$
100,000
 
James A. and Beverly J. Edwards
 
$
30,000
 
Gary L. and Mary L. Ewert
 
$
40,000
 
George Famuliner
 
$
50,000
 
James and Sandra Famuliner
 
$
50,000
 
Octavia R. Famuliner Trust
 
$
40,000
 
Farmers Grain Terminal, LLC
 
$
500,000
 
Walker C. Fletcher Trust
 
$
250,000
 
Gill Enterprises, Inc.
 
$
25,000
 
Gill Family Investments, LP
 
$
25,000
 
Viola M. Heil
 
$
20,000
 
Ralph and Mary Louise Henke, LP
 
$
50,000
 
Stephen L. Hopper
 
$
20,000
 
Jefferson City Oil Co.
 
$
300,000
 
Mike Kehoe
 
$
20,000
 
JW and Patricia Kipping
 
$
50,000
 
Mary Kipping Revocable Trust
 
$
40,000
 
Korff Farms Inc.
 
$
30,000
 
Stanley and Suzanne Kruse
 
$
25,000
 
Dale R. Ludwig
 
$
20,000
 
Joseph A. McCormick
 
$
125,000
 
Merlin Clark Farms, Inc.
 
$
30,000
 
Brenda Popp
 
$
20,000
 
Robert Quinn
 
$
25,000
 
Ray Carroll County Grain Growers, Inc.
 
$
1,000,000
 
Ray Land and Loan Company
 
$
100,000
 
Riley Brothers, LLC
 
$
150,000
 
John and Carolyn Thompson
 
$
25,000
 
John and Linda Urich
 
$
25,000
 
Rudolph Veit
 
$
20,000
 
Karen Venable Revocable Trust
 
$
100,000
 

 

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