Document:

PROMISSORY
      NOTE

     

     

    
      	
              $[Amount
                ]

            	
              November
                19,
                2007

            

    

    

    FOR
      VALUE RECEIVED, the undersigned,
      SMF Energy Corporation, a Delaware corporation (referred to herein as "Maker"),
      hereby promises to pay to the order of [Name of Investor, Tax Id No.:
      ______], their successors and assigns ("Payees") at [Address] or at such
      other place as Payees may from time to time designate in writing, the principal
      sum of [Amount], with interest on the unpaid principal balance from
      November 19, 2007 until paid, at the rate of 18.0% per annum. If not sooner
      paid, the entire principal amount outstanding, together with accrued interest
      thereon, shall be due and payable in six months time from the date hereof,
      provided however, that some or all of the principal amount of this
      Note, and the accrued but unpaid interest payable hereunder relating to such
      principal amount, will become immediately due and payable if and to the extent
      that Maker receives net proceeds from a private offering of its equity
      securities which, together with the aggregate net proceeds from the sale of
      this
      Note and other similar promissory notes sold concurrently herewith, exceed
      $3,500,000. 

    

    Maker
      shall have the right to prepay the principal amount and any accrued interest
      in
      part or in full, without penalty, of this Note at any time or times. Payments
      received for application to this Note shall be applied first to the payment
      of
      accrued interest and the balance applied in reduction of the principal amount
      hereof.

    

    If
      any
      payment required by this Note is not paid, and the continuation of such failure
      to pay for a period of ten (10) days of the receipt of written notice (as
      provided herein) of such failure by Payees or any subsequent holder hereof
      to
      Maker, this Note shall be considered to be in default and the entire unpaid
      principal sum hereof shall, at the option of the holder hereof, by notice to
      Maker, become immediately due and payable in full. Accrued but unpaid interest
      on this Note shall be paid in cash on the 19th day of each month that there
      is
      any unpaid principal outstanding on the Note.

    

    In
      the
      event the interest provisions hereof or any exactions provided for herein shall
      result, because of the reduction of principal, or for any reason at any time
      during the life of this loan, in an effective rate of interest which, for any
      month, transcends the limit of the usury or any other law applicable to the
      loan
      evidenced hereby, all sums in excess of those lawfully collectible as interest
      for the period in question shall, without further agreement or notice between
      or
      by any party hereto, be applied to reduction of the outstanding principal
      balance upon receipt of such moneys by Payees hereof, with the same force and
      effect as though the payment had specifically designated such extra sums to
      be
      so applied to principal. 

    

    In
      the
      event of default and the placement of this Note in the hands of any attorney
      for
      collection, Maker agrees to pay all collection costs and expenses, including
      reasonable attorneys’ fees. 

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    This
      Note
      is delivered as a part of a business transaction and not in connection with
      a
      consumer purchase. 

    

    Maker
      and
      all endorsers, guarantors and all persons liable or to become liable on this
      Note waive presentment, protest and demand, notice of protest, demand and
      dishonor and nonpayment of this Note, and agree that at any time and from time
      to time without notice, the terms of the payment herein may be modified, changed
      or exchanged by agreement between the Payees or any subsequent holder hereof
      and
      Maker or any successor in title to Maker without in any way affecting the
      liability of any party to this Note or any person liable or to become liable
      with respect to any indebtedness evidenced hereby. No delay or omission on
      the
      part of the holder hereof in exercising any right hereunder shall operate as
      a
      waiver of such right or of any other right under this Note. A waiver on one
      occasion shall not be construed as a bar to or waiver of any such right and/or
      remedy on any future occasion.

    

    Any
      notice provided for in this Note shall be in writing and shall be given and
      be
      effective upon (1) personal delivery to Maker, or (2) receipt of such notice
      by
      certified or registered mail, return receipt requested, addressed to Maker
      at
      Maker's address stated below, or to such other address as Maker may designate
      by
      written notice to Payees. Any notice to Payees shall be in writing and shall
      be
      given and be effective upon (1) personal delivery to Payees, or (2) by mailing
      such notice by certified or registered mail, return receipt requested, to Payees
      at the address stated in the first paragraph of this Note, or to such other
      address as Payees may designate by written notice to Maker.

    

    PAYEES
      ACKNOWLEDGE THAT THIS IS AN UNSECURED NOTE AND THAT IT IS SUBJECT IN ALL
      RESPECTS TO THE SUBORDINATION AGREEMENT BY AND BETWEEN PAYEES, MAKER, WACHOVIA
      BANK, NATIONAL. ASSOCIATION, H & W PETROLEUM COMPANY, INC. AND SMF SERVICES,
      INC., OF EVEN DATE HEREWITH. 

    

    The
      validity and construction of this Note and all matters pertaining hereto are
      to
      be determined in accordance with the laws of the State of Florida. Maker and
      all
      endorsers, guarantors and other persons liable or to become liable hereunder
      agree that in the event of default, this Note may be enforced in any court
      of
      competent jurisdiction in the State of Florida, and all such persons do hereby
      submit to the jurisdiction of such court regardless of their residence or where
      this Note or any endorsement or guarantee hereof may be executed.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

     

    IN
      WITNESS WHEREOF, Maker has executed this Note effective as of the date first
      set
      forth above.

    
      	 	 	 
	 	SMF ENERGY CORPORATION
	 
 	 
 	 
 
	 	By:  	 
	 	
              
Richard
              E. Gathright
	 	President
              and
              Cheif Executive Officer

    

    
      
        	 	 
	 	
                200
                  West Cypress Creek Road, Suite 400

                Fort
                  Lauderdale, FL 33309SUBORDINATION
      AGREEMENT

    

    

    THIS
      SUBORDINATION AGREEMENT executed effective as of the 19th day of November 2007,
      by and between [Name of Investor] (“Loan Holder”),
      Wachovia Bank, National Association ("Lender"), SMF Energy
      Corporation, a Delaware corporation (“SMF”), H & W
      Petroleum Company, Inc. (“H & W”) and SMF Services, Inc.
      (“SSI”) (SMF, H & W and SSI are referred to collectively as
“Borrower").

    

    WITNESSETH:

     

    WHEREAS,
      Loan Holder is the legal owner and holder of an unsecured Promissory Note dated
      November 19, 2007, executed by SMF in favor of Loan Holder (the "Note")
      (the
      loan evidenced by the Note, together with any present or future unsecured
      indebtedness of Borrower to Loan Holder of every kind and description, direct
      or
      contingent, due or not due, original, renewed or extended and whether now in
      existence or hereafter arising in connection with the Note are referred to
      as
      the "Subordinated
      Debt”);
      and

    

    WHEREAS,
      Lender and Borrower have entered into that certain Loan and Security Agreement
      dated September 26, 2002 (as at any time amended, the “Loan Agreement) and
      certain other loan documents in connection therewith (collectively, the
      "Loan
      Documents")
      which
      provide to Lender a first priority security interest ("Lender's
      Security Interest")
      in
      certain assets of Borrower whether now owned or hereafter acquired (the
      "Collateral"),
      in
      exchange for prior and continuing loans by Lender to Borrower (the “Loans");
      and

    

    WHEREAS,
      Borrower will materially benefit as a result of Lender continuing to make Loans
      to Borrower; and

    

    WHEREAS,
      Loan Holder is a shareholder of SMF and as such will benefit from Lender
      continuing to extend the Loans to Borrower; and

    

    WHEREAS,
      Loan Holder acknowledges that Lender is willing to continue extending the Loans
      only on the condition that the Subordinated Debt be subordinate and inferior
      to
      the Loans, and to all other indebtedness of Borrower to Lender, whether now
      in
      existence or hereafter created; and

    

    WHEREAS,
      Loan Holder has agreed to subordinate the Note and Subordinated Debt to the
      lien
      and effect of the Loans and Lender's Security Interest and all security
      instruments securing the Loans, and all other indebtedness of Borrower to Lender
      of every kind and description, direct or contingent, due or not due, secured
      or
      unsecured, original, renewed
      or
      extended, whether now in existence or hereafter arising, except that Lender
      has
      agreed to permit Loan Holder to be repaid with a portion of the proceeds of
      a
      proposed offering by SMF of equity securities meeting certain criteria set
      forth
      herein; and

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    WHEREAS,
      Loan Holder acknowledges that Lender would not continue to extend the Loans
      without the execution of this Agreement by Loan Holder and by any other
      subsequent lenders to Borrower (“Other
      Loan Holders”);
      and

    

    NOW,
      THEREFORE, in consideration of, and as an inducement to Lender to continue
      to
      extend the Loans to Borrower, Loan Holder, Lender and Borrower do hereby agree
      as follows:

    

    1. The
      facts
      as set forth above are true and correct and are incorporated herein by
      reference.

    

    2. Loan
      Holder and Borrower do hereby warrant and represent that the Note represents
      the
      only indebtedness currently outstanding which is due and owing from Borrower
      to
      Loan Holder.

    

    3. Loan
      Holder hereby unconditionally subordinates the Note and Subordinated Debt to
      the
      Loans and all other present and future debts and obligations of Borrower to
      Lender, including all obligations of Borrower to Lender of every kind and
      description, direct or contingent, due or not due, secured or unsecured,
      original, renewed or extended, whether now in existence or hereafter arising
      and
      to the lien and effect of Lender's Security Interest in and to the Collateral
      and to all Loan Documents and all other debts and obligations of Borrower to
      Lender. 

    

    4. Loan
      Holder and Borrower do hereby warrant, represent and agree that no payment
      (principal, interest or any other payment) shall be made, permitted or accepted
      under the Note or Subordinated Debt (or under any other document or agreement)
      until all of the Loans have been fully paid and the Loan Agreement terminated,
      excepting for payments of interest in money or shares of stock of Borrower
      which
      shall be permitted so long as no Event of Default (as defined in the Loan
      Agreement) has occurred and is continuing. If any payment is made to Loan Holder
      in payment of the Note or the Subordinated Debt or otherwise, or if any security
      or proceeds thereof is received on account of the Note or the Subordinated
      Debt
      contrary to the terms of this Agreement, the Borrower agrees that the same
      shall
      be and constitute an Event of Default. Loan Holder acknowledges that (i) upon
      the occurrence of an Event of Default, Lender shall be entitled to immediately
      exercise all remedies provided to Lender in connection with the Collateral
      and
      under the Loan Documents, and (ii) following the occurrence of such Event of
      Default and so long as the same shall be continuing, (A) each and every amount
      paid by or on behalf of any Borrower to Loan Holder or items received by Loan
      Holder (from any Borrower or from an individual or an entity on behalf of any
      Borrower) from and after such occurrence shall be forthwith paid by Loan Holder
      to Lender, in precisely the form received (except for Loan Holder's endorsement,
      where necessary), to be credited and applied, in Lender's sole discretion,
      upon
      any indebtedness (principal and/or interest and/or otherwise as Lender may
      elect, in its sole discretion) then owing to Lender by Borrower and, whether
      matured or unmatured, and, until so delivered, the same shall be held in trust
      by Loan Holder as the property of Lender; and (B) in the event of a failure
      of
      Loan Holder to endorse any instrument for the payment of monies so received
      by
      Loan Holder payable to Loan Holder's order, Lender, or any officer or employee
      of Lender, is hereby irrevocably constituted and appointed attorney-in-fact
      (coupled with an interest) for Loan Holder and Loan Holder's heirs,
      representatives, successors and assigns, with full power to make any such
      endorsement and with full power of substitution. Notwithstanding anything herein
      to the contrary and in accordance with the terms and conditions of the Note
      or
      Subordinated Debt, (i) Loan Holder may, at Loan Holder’s election, convert all
      or part of the Note or Subordinated Debt into common stock of SMF; to the extent
      permitted by the terms of the Note or as may subsequently be agreed by Borrower
      and Loan Holder and (ii) Borrower shall be entitled, so long as no Event of
      Default (as defined in the Loan Documents) has occurred and is continuing,
      to
      repay to Loan Holder in accordance with the terms of the Note, as the same
      may
      be hereinafter amended, the outstanding principal balance of the Note and the
      Subordinated Debt associated therewith from the proceeds of any issuance or
      sale
      by SMF of equity securities after the date hereof (but only to the extent of
      the
      net proceeds from such issuance or sale), and Loan Holder may accept and retain
      any such payment without regard to the provisions of this Agreement.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    5. Loan
      Holder agrees that it will not exercise any collection rights with respect
      to
      the Note or Subordinated Debt, will not take possession of, sell or dispose
      of,
      accept any lien on, or otherwise deal with, any Collateral, and will not
      exercise or enforce any right or remedy which may be available to Loan Holder
      with respect to the Note or Subordinated Debt upon default of Borrower under
      the
      Loans or any other indebtedness of Borrower to Lender or under the Subordinated
      Debt until such time as the Loans, as the same may be modified from time to
      time, including all principal, interest and other charges associated therewith,
      have been paid in full and no other debts or obligations are due and owing
      from
      Borrower to Lender and the Loan Agreement terminated. Loan Holder agrees to
      promptly notify Lender, in writing, by certified mail, return receipt requested,
      of any default by Borrower under the Notes or Subordinated Debt; and Lender
      agrees to promptly notify Loan Holder in the same manner of any Event of
      Default, but failure of Lender to notify Loan Holder shall not negate the Event
      of Default. 

    

    6. Upon
      any
      distribution of the assets or readjustment of indebtedness of Borrower, whether
      by reason of reorganization, liquidation, dissolution, bankruptcy, receivership,
      assignment for the benefit of creditors, or any other action or proceeding
      involving the readjustment of all or any part of the Subordinated Debt or the
      application of the assets of the Borrower to the payment or liquidation thereof,
      either in whole or in part, Lender shall be entitled to receive payment in
      full
      of any and all indebtedness under the Loans or otherwise then owing to Lender
      by
      Borrower prior to the payment of all or any of the Subordinated Debt.

    

    7. Loan
      Holder agrees that Loan Holder shall not transfer, assign, encumber, hypothecate
      or subordinate, at any time while this Agreement remains in effect, any right,
      claim or interest of any kind in or to any of Loan Holder's Subordinated Debt,
      either principal or interest or otherwise, unless such transfer, encumbrance,
      hypothecation or subordination is made upon prior written notice to Lender,
      subject to this Subordination Agreement, and the transferee or recipient has
      expressly assumed the covenants and obligations contained herein; and provided
      further that there shall promptly be placed on each of the Notes a legend
      reciting that the same is subject to this Agreement.

    

    8. Loan
      Holder acknowledges that Lender may, at any time, in its discretion, increase
      or
      decrease the amount of the Loans, renew or extend the time of payment of all
      or
      any portion of the Loans or any other existing or future indebtedness or
      obligations of Borrower to Lender and/or waive or delay in enforcing any rights
      or release any collateral relative thereto at any time(s) and, in reference
      thereto, to modify or amend the Loan Documents (including, without limitation,
      to add or release any person or entity as a borrower or guarantor thereunder,
      to
      accept additional collateral as security for the Loans or to release any
      existing Collateral, to expand the Events of Default contained therein, to
      expand Lender's enforcement remedies thereunder, or otherwise) and/or make
      and
      enter into such agreement(s), compromise(s) and other indulgence(s), as Lender
      may deem proper or desirable, without notice to or further assent of Loan
      Holder, all without in any manner impairing or affecting this Agreement or
      any
      of Lender's rights hereunder.

    

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    9. Loan
      Holder hereby agrees that Loan Holder will render to Lender, upon demand, from
      time to time, a statement of the account of Loan Holder with Borrower. Borrower
      agrees to duly comply with and conform with each and every term of this
      Agreement, on its part required to be performed.

    

    10. All
      notices, demands and communications given or made hereunder or pursuant thereto
      shall be in writing and shall be hand delivered, delivered by recognized
      expedited carrier, or mailed by registered or certified mail with postage
      prepaid, addressed in each case as follows and shall be deemed to have been
      given or made when so mailed:

    

    
      	
            	To
              Loan Holder:	
              [Investor]

            

    

    [Address]

    [Address]

    Attention:
      [Authorized Representative]

    

    
      	
            	To
              Lender:	
              Wachovia
                Bank, National Association.

            

    

    110
      East
      Broward Boulevard

    Suite
      20508

    Miami,
      FL
      33301

    Attention:
      Portfolio Manager

    

    

    
      	
            	To
              Borrower:	
              SMF
                Energy Corporation.

            

    

    200
      West
      Cypress Creek Road

    Suite
      400

    Fort
      Lauderdale, FL 33309

    Attn:
      Richard E. Gathright, President

    

    or
      to
      such other address or to such other person as any party shall designate to
      the
      others for such purposes in the manner hereinabove set forth.

    

    11. The
      parties hereto acknowledge and agree that Loan Holder shall be deemed to have
      appointed Lender as Loan Holder’s attorney-in-fact (coupled with an interest)
      for the purposes of ensuring compliance with Lender’s rights under Section 4
      hereof and, in any bankruptcy or other insolvency proceeding, to give Lender
      the
      right (without any obligation or liability): (a) to file proofs of claim for
      the
      Subordinated Debt, either in Lender’s or Loan Holder’s name; (b) to receive any
      assets of Borrower distributed on account of the Subordinated Debt for
      application to the Loans; (c) to vote claims for the Subordinated Debt to accept
      or reject any plan of reorganization or liquidation; and (d) to take any action
      in such bankruptcy or other insolvency proceeding that Loan Holder would be
      authorized to take in respect of the Subordinated Debt but for this Agreement.
      The terms of this Agreement shall remain in full force and effect until the
      Loan
      and any other indebtedness of any Borrower to Lender, or any Replacement
      Facility (as defined below) is indefeasibly paid in full and Lender's
      commitments to make further extensions of credit to any Borrower have been
      terminated

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    12. This
      Agreement may be signed in multiple counterparts, and each such counterpart
      shall have the same binding force and effect as if it were signed by all parties
      hereto. This Agreement shall be governed by the laws of the State of Delaware.
      The terms of this Agreement cannot be waived, changed or terminated, except
      by a
      written document signed by Lender. This Agreement shall be binding upon the
      undersigned and their successors and assigns and shall inure to the benefit
      of
      and shall be enforceable by Lender, and any participants, successors or assigns
      of Lender. In addition, any person or entity whose loans (a "Replacement
      Facility")
      are
      used to refinance and pay in full the Loan shall be deemed for all purposes
      hereof to be the successor to Lender, and from and after the date of any such
      refinancing and satisfaction in full of the Loan, such persons or entities
      shall
      be deemed a party hereto in the place and stead of Lender, as if such persons
      or
      entities had been original signatories hereto, and all loans, advances,
      liabilities, debit balances, covenants and duties at any time or times owed
      by
      Borrowers to such successor shall be deemed for all purposes hereunder to
      constitute and be the "Loan".

    

    13. WAIVER
      OF JURY TRIAL.
      BORROWER, LOAN HOLDER AND LENDER HEREBY MUTUALLY, KNOWINGLY, WILLINGLY,
      INTENTIONALLY AND VOLUNTARILY WAIVE THEIR RIGHT TO TRIAL BY JURY AND NO PARTY
      NOR ANY ASSIGNEE, SUCCESSOR, HEIR, OR LEGAL REPRESENTATIVE OF THE PARTIES (ALL
      OF WHOM ARE HEREINAFTER COLLECTIVELY REFERRED TO AS THE "PARTIES") SHALL SEEK
      A
      JURY TRIAL IN ANY LAWSUIT, PROCEEDING, COUNTERCLAIM OR ANY OTHER LITIGATION
      PROCEEDING BASED UPON OR ARISING OUT OF THIS AGREEMENT OR THE LOAN DOCUMENTS
      OR
      ANY INSTRUMENT EVIDENCING, SECURING OR RELATING TO THIS AGREEMENT OR THE LOAN
      DOCUMENTS, THE INDEBTEDNESS OR OTHER OBLIGATIONS REFERRED TO HEREIN OR ANY
      RELATED AGREEMENT OR INSTRUMENT, ANY OTHER COLLATERAL FOR THE INDEBTEDNESS
      REFERRED TO HEREIN OR ANY COURSE OF ACTION, COURSE OF DEALING, STATEMENTS
      (WHETHER VERBAL OR WRITTEN) OR ACTIONS RELATING TO THE LOAN OR TO THIS
      AGREEMENT. THE PARTIES ALSO WAIVE ANY RIGHT TO CONSOLIDATE ANY ACTION IN WHICH
      A
      JURY TRIAL HAS BEEN WAIVED WITH ANY OTHER ACTION IN WHICH A JURY TRIAL HAS
      NOT
      BEEN WAIVED. THE PROVISIONS OF THIS PARAGRAPH HAVE BEEN FULLY NEGOTIATED BY
      THE
      PARTIES. THE WAIVER CONTAINED HEREIN IS IRREVOCABLE, CONSTITUTES A KNOWING
      AND
      VOLUNTARY WAIVER, AND SHALL BE SUBJECT TO NO EXCEPTIONS. LENDER HAS IN NO WAY
      AGREED WITH OR REPRESENTED TO LOAN HOLDER OR ANY OTHER PARTY THAT THE PROVISIONS
      OF THIS PARAGRAPH WILL NOT BE FULLY ENFORCED IN ALL INSTANCES.

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

    

    IN
      WITNESS WHEREOF, the undersigned have executed this Subordination Agreement
      as
      of the date first written above.

     

    

    

    

    
      	
              LOAN
                HOLDER:

            	
              [Name
                of Investor]

            
	 	 
	 	 
	 	 
	 	
              By:
                __________________________________

            
	 	
              Name:
                _______________________________

            
	
               

            	
              Title:
                ________________________________

            
	 	 
	 	 
	 	 
	 	 
	
              LENDER:

            	
              WACHOVIA
                BANK, NATIONAL ASSOCIATION

            
	 	 
	 	 
	 	 
	
            	
              By:
                __________________________________

            
	 	
              Name:
                _______________________________

            
	
            	
              Title:
                ________________________________

            
	 	 
	 	 
	 	 
	
              BORROWER:

            	
              SMF
                ENERGY CORPORATION

            
	 	 
	 	 
	 	 
	
            	
              By:
                _____________________________________

            
	
            	
              Richard
                E. Gathright

            
	
            	
              President
                and Chief Executive Officer

            
	 	 
	 	 
	 	 
	 	 
	 	
              H
                & W PETROLEUM COMPANY, INC.

            
	 	 
	 	 
	 	 
	
            	
              By:
                _____________________________________

            
	
            	
              Richard
                E. Gathright

            
	
            	
              President
                and Chief Executive
                Officer

            

    

     

    
      
        
        

      

      
        
        

        
          

        

      

      
        
        

      

       

    

    
      	 	 	 
	 	SMF SERVICES,
              INC.
	 
 	 
 	 
 
	
            	By:  	 
	 	
              
Richard
              E. Gathright
	 	President
              and Chief Executive Officer

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