EXHIBIT 10.1

 

AMENDMENT NUMBER ONE TO

CONSULTING AGREEMENT

 

THIS AMENDMENT NUMBER ONE TO CONSULTING AGREEMENT (this “Amendment”) is made and
entered into as of February 8, 2012 by and between Cano Petroleum, Inc., a
Delaware corporation (the “Company”), and John H. Homier (“Consultant”).  The
Company and Consultant are referred to in this Amendment as the “Parties.”

 

RECITALS

 

A.            The Parties previously entered into that certain Consulting
Agreement dated July 11, 2011 between the Company and Consultant (the “Original
Agreement”).

 

B.            The Parties desire to modify the Original Agreement to provide for
payment of consulting fees to the Consultant on an hourly basis and for payment
of a cash bonus, as provided in this Amendment.

 

AGREEMENT

 

NOW, THEREFORE, for and in consideration of the foregoing premises and the
provisions hereof and for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the Parties agree as follows:

 

1.             Consulting Fee and Bonus.  Paragraph 2(a) of the Original
Agreement is amended and restated in its entirety as follows:

 

a.                                       Consulting Fee and Bonus.  During the
period beginning on January 1, 2012 and ending at the end of the Consulting
Period, the Company shall pay Consultant a consulting fee at the rate of $395
per hour that the Consultant provides Consulting Services to the Company and
reimburse Consultant for reasonable travel expenses incurred while providing
Consulting Services, (the “Consulting Fee”), payable within five business days
of invoice by Consultant.  Consultant will invoice the Company bi-weekly.  The
Company shall pay Consultant a cash bonus in the amount of $150,000 upon the
termination of this Agreement by the Company for any reason other than
Consultant’s gross negligence or willful misconduct.

 

2.             Retainer.  Paragraph 2 of the Original Agreement is amended by
adding subparagraph (h) as follows:

 

h.                                      Retainer.  The Company has paid to
Consultant a retainer in the amount of $20,000 (the “Retainer”) in connection
with the execution of Amendment Number One to this Agreement dated
February     , 2012.  The Retainer will be held by Consultant and applied
against the final Consulting Fee invoiced by Consultant to the Company.  If the
amount of the final Consulting Fee invoiced by Consultant to the Company is less
than the Retainer, Consultant will promptly pay the Company the amount by which
the Retainer exceeds the final Consulting Fee.  Consultant will not be required
to establish a trust fund or otherwise keep the Retainer separate from
Consultant’s general funds.

 

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3.             Choice of Law.  This Amendment has been executed and delivered in
and shall be interpreted, construed and enforced pursuant to and in accordance
with the laws of the State of Texas, without giving effect to the conflicts of
law principles thereof.

 

4.             Headings.  The headings contained in this Amendment are for
reference purposes only and shall not affect in any way the meaning or
interpretation of this Amendment.

 

5.             Execution and Delivery.  This Amendment may be executed in
several counterparts, all of which will together constitute a single agreement
among the Parties.  Delivery by electronic transmission of an executed
counterpart of the signature page to this Amendment shall be as effective as
delivery of a manually executed counterpart of this Amendment.

 

6.             No Other Amendments.  Except as modified by this Amendment, all
provisions of the Original Agreement shall continue in full force and effect.

 

[Signature Page Follows]

 

2

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IN WITNESS WHEREOF, the Parties have executed this Amendment effective as of the
date first set forth above.

 

 

THE COMPANY:

 

 

 

CANO PETROLEUM, INC.

 

 

 

By:

 

/s/ James R. Latimer, III

 

 

James R. Latimer, III,

 

 

Chief Executive Officer

 

 

 

 

 

CONSULTANT:

 

 

 

/s/ John H. Homier

 

John H. Homier

 

AMENDMENT NUMBER ONE TO CONSULTING AGREEMENT

SIGNATURE PAGE

 

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