Exhibit 10.1
PAYMENT IN KIND
AGREEMENT
THIS PAYMENT IN
KIND AGREEMENT (the “ Agreemen t”) is dated and
effective as of the 27th day of April, 2009, between SMF Energy
Corporation (the “ Company ”) and the
undersigned holder (the “ Preferred Stockholder
”) of the Company’s Series A Convertible Preferred
Stock (the “ Series A Preferred Stock ”), Series
B Convertible Preferred Stock (the “ Series B Preferred
Stock ”) and Series C Convertible Preferred Stock (the
“ Series C Preferred Stock ”), as
applicable.
RECITALS
WHEREAS, on
December 31, 2008, the Board of Directors declared, but has not yet
paid, dividends of (i) Sixteen Dollars and Eighty-Two Cents
($16.82) per share on its outstanding shares of Series A Preferred
Stock, (ii) Twenty-Seven Dollars and Fifty-Two Cents ($27.52) per
share on its outstanding shares of Series B Preferred Stock and
(iii) Twenty-Six Dollars and Eighteen Cents ($26.18) per share on
its outstanding shares of Series C Preferred Stock, to be paid to
the Preferred Stockholders of record at the close of business on
January 21, 2009, for the quarter ended December 31, 2008 (the
“ December Dividends ”);
WHEREAS, the
Company acknowledges that, at such time as it is declared by the
Board of Directors, it will be obligated to pay dividends of (i)
Sixteen Dollars and Twenty-Seven Cents ($16.27) per share on its
outstanding shares of Series A Preferred Stock, (ii) Twenty-Six
Dollars and Sixty-Three Cents ($26.63) per share on its outstanding
shares of Series B Preferred Stock and (iii) Nineteen Dollars and
Twenty-Three Cents ($19.23) per share on its outstanding shares of
Series C Preferred Stock, to the Preferred Stockholders of record
as of a date to be determined by the Board of Directors, for the
quarter ended March 31, 2009 (the “ March Dividends
”); and
WHEREAS, the
Company desires to pay the December Dividends and the March
Dividends with unregistered shares of the Company’s common
stock (“ Common Shares ”) instead of cash and
the Preferred Stockholder desires to accept Common Shares as
payment for the December Dividends and March Dividends.
NOW, THEREFORE,
BE IT RESOLVED, that in consideration of the mutual promises and
other good and valuable consideration set forth herein, the Company
and the Preferred Stockholder agree as follows:
AGREEMENT
1.
Payment in Kind . The Company agrees to issue,
and the Preferred Stockholder agrees to accept, as payment in kind
for the amounts due for the December Dividends and the March
Dividends, Common Shares in the amounts set forth on the signature
page hereto. The Common Shares shall be valued at $0.23
per share, which was the Official Closing Price on the Nasdaq Stock
Market on April 24, 2009, the trading day immediately preceding the
date of this Agreement. The Common Shares will be issued
as soon as practicable upon completion and execution of this
Agreement and the Investment Representation Statement attached
hereto.
2.
Registration of Common Shares . The Common Shares
shall be deemed to be “Registrable Securities” under
the Registration Rights Agreement appended to the Securities
Purchase Agreements between the Preferred Stockholder and the
Company relating to the purchase of the Series A Preferred Stock,
Series B Preferred Stock and Series C Preferred Stock, except that
the Preferred Stockholder shall be deemed to have requested such
registration immediately upon execution of this Agreement
an
