EXHIBIT 10.1

 

SUMMARY OF 2009 CASH INCENTIVE AWARDS

 

The 2009 Cash Incentive Awards are based on the following threshold, target and
maximum performance goals for fiscal year 2009 and the weighting set forth next
to the goals (Cano Petroleum, Inc. (“Cano”) notes that these goals are part of
Cano’s incentive program and do not correspond to any financial or performance
guidance that Cano has provided or will provide and should not be considered as
statements of Cano’s expectations or estimates):

 

 

 

Performance Goals

 

 

 

Performance Measure

 

Threshold

 

Target

 

Maximum

 

Weighting

 

Company Goals

 

 

 

 

 

 

 

 

 

Production*

 

1,212 BOEPD

 

1,346 BOEPD

 

1,616 BOEPD

 

55

%

Proved Developed Producing Reserves

 

11,400 MBOE

 

12,667 MBOE

 

15,200 MBOE

 

15

%

EBITDA

 

$13,155,000

 

$14,617,000

 

$17,540,000

 

15

%

Finding & Development Costs

 

$24.87 per BOE

 

$22.38 per BOE

 

$18.65 per BOE

 

15

%

 

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*Average daily production for fiscal year 2009.

 

Cano calculates EBITDA as earnings before interest, taxes, depreciation and
amortization.

 

The 2009 Cash Incentive Awards potential payout levels based on meeting the
specified level of each of the performance goals for the 2009 Cash Incentive
Awards performance goals for each executive officer are set forth below:

 

 

 

 

 

 

 

2009 Bonus Payout

 

 

 

Base Salary

 

Target Bonus
(% of Salary)

 

Threshold
(50% of
Target)

 

Target

 

Maximum
(150% of
Target)

 

S. Jeffrey Johnson

 

$

509,480

 

75

%

$

191,055

 

$

382,110

 

$

573,165

 

Benjamin Daitch

 

$

250,000

 

75

%

$

93,750

 

$

187,500

 

$

281,250

 

Patrick McKinney

 

$

250,000

 

75

%

$

93,750

 

$

187,500

 

$

281,250

 

Michael J. Ricketts

 

$

187,000

 

50

%

$

46,750

 

$

93,500

 

$

140,250

 

Phillip Feiner

 

$

170,000

 

50

%

$

42,500

 

$

85,000

 

$

127,500

 

 

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