**Exhibit10.12**

 

**SecondAmendment to Sponsorship Agreement**

 

**               **Reference isherein made to that certain Sponsorship Agreement dated December 16, 2004,executed by and between R.C. Boyd Enterprises, LLC, a Texaslimited liability company, whose mailing address is 807 Pearl Drive,Southlake, Texas  76092, and CanoPetroleum, Inc., a Delaware corporation, whose mailing address is 801 CherryStreet, Suite 3200, Fort Worth, Texas 76102, as amended by FirstAmendment to Sponsorship Agreement dated effective as of August 16, 2004 (asamended, the “Agreement”).  Capitalized terms not otherwisedefined in this Second Amendment to Sponsorship Agreement (“Amendment”) shallhave the meanings ascribed to them in the Agreement.

 

                WHEREAS, theCompany and Sponsor have fully and completely performed their obligations underthe terms and provisions of the Agreement to date; and

 

                WHEREAS, theCompany and Sponsor now desire to amend, supplement and alter the terms andprovisions of the Agreement with respect to amended negotiations of theAgreement as provided in Section 10. of the Agreement.

 

                NOW, THEREFORE,for and in consideration of the premises and the mutual benefits, promises,covenants, and agreements set forth in this Amendment, the Company and Canoagree to amend, alter and supplement the Agreement as follows:

 

                Section 10. Termand Renewal shall be deleted in its entirety and the following substitutedin place and in lieu thereof:

 

“10.         Termand Renewal.  The initial term ofthis Agreement shall be one (1) year, commencing January 1, 2005 and ending onDecember 31, 2005.  This Agreement may berenewed by Cano on the first and second anniversaries of the Agreement in thefollowing manner: Cano shall give written notice to Company of its intention torenew this contract for a period of an additional one (1) year, such notice tobe given not more than ninety (90) days nor less than thirty (30) days beforethe expiration of the initial term and/or the second term of this Agreement (ifextended after the initial term).  The considerationfor the second year shall be $150,000.00 (One Hundred Fifty Thousand Dollars),and the consideration for the third year shall be $150,000.00 (One HundredFifty Thousand Dollars).”

 

In all other respects, the Agreement, as amended, altered and supplementedhereby shall remain the same and unchanged as originally written and in fullforce and effect.

 

By their execution and delivery of this Amendment, Cano hereby providesand Company hereby accepts, Cano’s notice of the exercise of its option to renewthe Agreement for the second year at the consideration set forth in Section 10.of the Agreement, as amended hereby.

 

 

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This Amendment may be executed via facsimile and/or inmultiple originals and/or counterparts, each of which shall be deemed anoriginal for all purposes, but all such counterparts together shall constituteone and the same instrument.

 

                This SecondAmendment to Sponsorship Agreement is executed, delivered and effective asof  the 1st day of December,2005.

 
|   | R. C. BOYD ENTERPRISES, LLC |
|--------|-----------------------------|
|   |                        |   |
|   |                        |   |
|   |                        |   |
|   | By:                         | /s/ R. C. Boyd |
|   |                        |   |
|   | Printed Name:               | R. C. Boyd |
|   |                        |   |
|   | Title:                      | President |
|   |                        |   |
|   |                        |   |
|   |                        |   |
|   |                        |   |
|   |                        |   |
|   | CANO PETROLEUM, INC.        |   |
|   |                        |   |
|   |                        |   |
|   | By:                         | /s/ Jeff Johnson |
|   |                        |   |
|   | Printed Name:               | Jeff Johnson |
|   |                        |   |
|   | Title:                      | CEO |
|   |                        |   |
|   |                        |   |
|        |                             |  |  |  |  |

 

 

 

 

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