Document:

Exhibit 10.26

                      SUBORDINATION AND NOMINEE AGREEMENT

     This Subordination and Nominee Agreement (this "Agreement") is made as of
the 21st day of February, 2003, by and between The William M. Beard and Lu Beard
1988 Charitable Unitrust (the "Unitrust"), Boatright Family, L.L.C.
("Boatright"), B&M Limited, a Partnership ("B&M"), and McElmo Dome Nominee, LLC,
a limited liability company ("Nominee").

     Whereas, The Beard Company (the "Company") has executed and delivered to
William M. Beard and Lu Beard, as Trustees of the Unitrust that certain
Promissory Note in the original principal amount of $3,000,000, dated as of
October 3, 2002 (the "Unitrust Note"), evidencing, in part, a renewal and
extension of indebtedness previously evidenced by that certain Promissory Note
executed by the Company and payable to Unitrust, dated February 28, 2002 (the
"Prior Unitrust Note"); and

     Whereas, the Unitrust, the Nominee, and certain purchasers (the "2002
Noteholders") of the Company's 10% Subordinated Notes (the "2002 Notes") due
September 30, 2003 have previously entered into a Nominee Agreement dated May
16, 2002 (the "2002 Nominee Agreement") under which the Nominee has agreed to
act as agent and nominee on behalf of Unitrust and the 2002 Noteholders under
that certain Deed of Trust, Assignment of Production, Security Agreement, and
Financing Statement, dated as of May 16, 2002 (the "2002 Deed of Trust"),
executed by the Company, covering certain properties owned by the Company and
located in Montezuma County and Dolores County, Colorado (collectively, the
"2002 Collateral") and securing payment of the Prior Unitrust Note and the 2002
Notes; and

     Whereas, under the 2002 Nominee Agreement, following the occurrence of
certain events, the rights of the Unitrust and the 2002 Noteholders to proceeds
of enforcement of the 2002 Deed of trust are pari passu, and any recovery under
the 2002 Deed of Trust is to be allocated 1200/2843 to the 2002 Noteholders and
1643/2843 to the Unitrust; and

     Whereas, contemporaneously with the execution and delivery of this
Agreement, and pursuant to a $600,000 Private Placement Memorandum dated January
21, 2003, B&M and Boatright have made loans to the Company in the amount of
$50,000 and $550,000, respectively, and in connection therewith the Company has
executed and delivered certain Promissory Notes in such amounts dated as of
February 7, 2003 and February 21, 2003, respectively (collectively, the "2003
Notes"); and

     Whereas, to secure payment of the loans evidenced by the 2002 Notes, the
2003 Notes, and the Unitrust Note the Company has executed and delivered that
certain Deed of Trust, Assignment of Production, Security Agreement, and
Financing Statement, dated as of February 21, 2003 (the "2003 Deed of Trust"),
covering the 2002 Collateral and other properties described therein (the "2003
Collateral"), for the benefit of the Nominee under the terms of this Agreement;
and

     Whereas, the Unitrust and the 2003 Noteholders , for themselves and for the
benefit of the 2002 Noteholders, desire to enter into this Agreement to provide
for the orderly enforcement of the rights of the 2002 Noteholders, the 2003
Noteholders, and the Unitrust (collectively, the "Noteholders") in the liens
(the "Liens") created under the 2002 Deed of Trust and the 2003 Deed of Trust
(collectively, the "Deeds of Trust") in the 2002 Collateral and the 2003
Collateral (collectively, the "Collateral") and to set forth the priority as
among all Noteholders of all proceeds from the foreclosure, deed-in-lieu of
foreclosure, or other sale or disposition of the Collateral or the rights of the
Nominee under the Deeds of Trust, or of any other recovery resulting from or
under the Deeds of Trust ("Proceeds") ; and

     Whereas, as a condition of making the loan to the Company, the 2003
Noteholders require that, with respect to the Proceeds, the 2003 Noteholders be
entitled to the priority held by the Unitrust under the 2002 Nominee Agreement
to the extent of the principal indebtedness held by the 2003 Noteholders, and
interest thereon, and that the Unitrust's priority with respect to Proceeds be
subordinated to the priority of the 2003 Noteholders; and

     Whereas, a portion of the proceeds from the sale of the 2003 Notes have
been or will be used to pay down the Unitrust Note, and to facilitate such
transaction the Unitrust has agreed to enter into this Agreement and to
subordinate the Unitrust's priority with respect to Proceeds as provided herein.

     Now, therefore, in consideration of the foregoing premises, the mutual
covenants and agreements contained in this Agreement, and other good and
valuable considerations, the receipt and adequacy of which are hereby
acknowledged, the Unitrust and the 2003 Noteholders hereby designate and appoint
Nominee as their agent to act on behalf of all Noteholders in holding the
beneficial interest granted under the 2003 Deed of Trust, and in enforcing any
and all rights of the beneficiary under the 2003 Deed of Trust as provided
herein, and Nominee hereby accepts such designation and appointment and agrees
to hold such interest and act with respect to such interest in accordance with
the terms and conditions of this Agreement.

     For the considerations stated above, the Unitrust, the 2003 Noteholders,
and Nominee hereby further agree as follows:

     1. 2002 Nominee Agreement. The Unitrust hereby waives any and all
conditions precedent and other requirements (including, without limitation, the
requirement that a Triggering Event, as defined in the 2002 Nominee Agreement,
shall have occurred) and agrees that from and after the date of this Agreement,
the 2002 Noteholders shall be deemed "Lienholders" under the under the 2002
Nominee Agreement and beneficiaries under the 2002 Deed of Trust.

     2. Nominee. Nominee shall act as the Noteholders' agent and shall hold
title as nominee to the Liens and the Collateral for the benefit of all
Noteholders.

     3. Enforcement of Deeds of Trust. Nominee shall not transfer, sell, pledge,
hypothecate, encumber, or otherwise exercise any incident of ownership with
respect to the Liens or the Collateral held by it as nominee, except as directed
by the all Noteholders, except as follows:

          a. At all times prior to payment in full of the 2002 Notes, Nominee
shall execute and deliver such instruments and shall take such actions or
refrain from taking such actions as the 2002 Noteholders holding a
majority-in-interest of the 2002 Notes may require for purposes of enforcing the
rights of the Noteholders under the Deeds of Trust. For purposes of this
Agreement, the term "majority-in-interest" shall refer to the holders of the
promissory notes evidencing greater than fifty percent (50%) of the principal
amount of the then outstanding 2002 Notes.

          b. At all times following payment in full of the 2002 Notes, but prior
to payment in full of the Unitrust Note, Nominee shall execute and deliver such
instruments and shall take such actions or refrain from taking such actions as
the Unitrust may require for purposes of enforcing the rights of the Noteholders
under the Deeds of Trust.

     4. Disposition of Collateral. All Proceeds shall be applied as described in
the attached Exhibit A, and as more fully described below, in the following
order:

          a. First, to the expenses incurred in enforcement of the Deeds of
Trust, the obligations secured thereby, and collection of such obligations;

          b. Second, to the 2002 Noteholders to the extent necessary to pay
$438,223 in principal and interest accrued thereon under the 2002 Notes and to
the 2003 Noteholders to the extent necessary to pay $600,000 in principal and
interest accrued thereon under the 2003 Notes, with the rights of the 2002
Noteholders and the 2003 Noteholders to be pari passu, with such Proceeds to be
allocated between the 2002 Noteholders and the 2003 Noteholders pro rata the
principal amounts to be paid under this paragraph 4b. As among all 2002
Noteholders, the rights of each of the 2002 Noteholders with respect to Proceeds
received under this Section 4b shall be pari passu and the 2002 Noteholders
shall share in any such Proceeds pro rata the unpaid principal of the 2002
Notes. As among all 2003 Noteholders, the rights of each of the 2003 Noteholders
with respect to Proceeds received under this Section 4b shall be pari passu and
the 2003 Noteholders shall share in any such Proceeds pro rata the unpaid
principal of the 2003 Notes;

          c. Third, to the 2002 Noteholders to the extent necessary to pay the
$761,777 balance of the 2002 Notes and interest accrued thereon and to the
Unitrust to the extent necessary to pay $1,043,000 in principal and interest
accrued thereon under the Unitrust Note, with the rights of the 2002 Noteholders
and the Unitrust to be pari passu, with such Proceeds to be allocated between
the 2002 Noteholders and the Unitrust pro rata the principal amounts to be paid
under this paragraph 4b. As among all 2002 Noteholders, the rights of each of
the 2002 Noteholders with respect to Proceeds received under this Section 4b
shall be pari passu and the 2002 Noteholders shall share in any such Proceeds
pro rata the unpaid principal of the 2002 Notes; and

          d. Fourth, to the Unitrust to the extent necessary to pay the balance
of the Unitrust Note and interest accrued thereon; and

          e. Fifth, as required by law and by the Deeds of Trust.

     5. Notice to Noteholders. The Nominee may, at any time, notify any
Noteholder of the status of the obligations secured by the Deeds of Trust and
the enforcement thereof, including any notice or instruction received by the
Nominee by any Noteholder.

     6. Binding Effect. This Agreement shall be binding upon the respective
successors and assigns of the parties hereto.

     7. Termination. This Agreement may not be terminated without the written
consent of the Noteholders; provided, that following payment in full of the 2003
Notes, no such consent shall be required of the 2003 Noteholders, and following
payment in full of the 2002 Notes, no such consent shall be required of the 2002
Noteholders. In the event of termination, Nominee agrees to take such action and
execute such documents as the Noteholders shall request to cause the Liens or
the Collateral to be conveyed to the Noteholders, or as otherwise directed by
the Noteholders.

     8. Governing Law. The provisions of this Agreement shall be construed in
accordance with the laws of the State of Oklahoma.

     9. Counterparts. This Agreement may be executed in any number of
counterparts, each of which shall be deemed as original, but all of which
together shall constitute one and the same agreement.

"UNITRUST"                 THE WILLIAM M. BEARD AND LU
                              BEARD 1988 CHARITABLE UNITRUST

                           By   WILLIAM BEARD
                                William Beard, Trustee

"NOMINEE"                  MCELMO  DOME  NOMINEE,  LLC,  an  Oklahoma
                              limited  liability company

                           By   WILLIAM BEARD
                                William Beard, Member

                           By   JAMES W. WALLIS
                                James W. Wallis, Member

"2003 NOTEHOLDERS"         BOATRIGHT  FAMILY  L.L.C.,   an  Oklahoma
                              limited   liability company

                           By   PETER BOATRIGHT
                                Peter Boatright, , Manager

                           B&M LIMITED, an Oklahoma general partnership

                           By   HERB MEE, JR.
                                Herb Mee, Jr., General Partner

                           By   WILLIAM BEARD
                                William Beard, General Partner

     ACKNOWLEDGED by The Beard Company this 21st day of February, 2003.

                                                HERB MEE
                                                Herb Mee, Jr., President

STATE OF OKLAHOMA     )
                      )  SS.
COUNTY OF OKLAHOMA    )

     The foregoing instrument was acknowledged before me this ______ day of
______________________, 2003, by William Beard, Trustee of The William M. Beard
and Lu Beard 1988 Charitable Unitrust.

                                        Notary Public
My Commission Expires:                  Commission No. ___________________

_____________________
                  (SEAL)

STATE OF OKLAHOMA     )
                      )  SS.
COUNTY OF OKLAHOMA    )

     The foregoing instrument was acknowledged before me this ______ day of
______________________, 2003, by William Beard, Member of McElmo Dome Nominee
LLC, an Oklahoma limited liability company, on behalf of the limited liability
company.

                                        Notary Public
My Commission Expires:                  Commission No. ___________________

_____________________
                  (SEAL)

STATE OF OKLAHOMA     )
                      )  SS.
COUNTY OF OKLAHOMA    )

     The foregoing instrument was acknowledged before me this ______ day of
______________________, 2003, by James W. Wallis, Member of McElmo Dome Nominee
LLC, an Oklahoma limited liability company, on behalf of the limited liability
company.

                                        Notary Public
My Commission Expires:                  Commission No. ___________________

_____________________
                  (SEAL)

STATE OF OKLAHOMA     )
                      )  SS.
COUNTY OF OKLAHOMA    )

     The foregoing instrument was acknowledged before me this ______ day of
______________________, 2003, by Peter Boatright, Manager of Boatright Family
L.L.C., an Oklahoma limited liability company, on behalf of the limited
liability company.

                                        Notary Public
My Commission Expires:                  Commission No. ___________________

_____________________
                  (SEAL)

STATE OF OKLAHOMA     )
                      )  SS.
COUNTY OF OKLAHOMA    )

     The foregoing instrument was acknowledged before me this ______ day of
______________________, 2003, by Herb Mee, Jr., general partner of B&M Limited,
an Oklahoma general partnership, on behalf of the partnership.

                                        Notary Public
My Commission Expires:                  Commission No. ___________________

_____________________
                  (SEAL)

STATE OF OKLAHOMA     )
                      )  SS.
COUNTY OF OKLAHOMA    )

     The foregoing instrument was acknowledged before me this ______ day of
______________________, 2003, by William Beard, general partner of B&M Limited,
an Oklahoma general partnership, on behalf of the partnership.

                                        Notary Public
My Commission Expires:                  Commission No. ___________________

_____________________
                  (SEAL)

STATE OF OKLAHOMA     )
                      )  SS.
COUNTY OF OKLAHOMA    )

     The foregoing instrument was acknowledged before me this ______ day of
______________________, 2003, by Herb Mee, Jr., President of The Beard Company,
an Oklahoma corporation, on behalf of the corporation.

                                        Notary Public
My Commission Expires:                  Commission No. ___________________

_____________________
                  (SEAL)Exhibit 10.27

                              AMENDED AND RESTATED
                                 PROMISSORY NOTE

$200,000.00                                             Oklahoma City, Oklahoma
                                                              November 19, 2003

     For value received, the undersigned, THE BEARD COMPANY, an Oklahoma
corporation (the "Maker"), agrees to all of the terms of this Amended and
Restated Promissory Note (this "Note") and promises to pay to the order of THE
JOHN M. BEARD TRUST (the payee, his successors and assigns are hereinafter
called the "Holder"), at Enterprise Plaza, Suite 320, 5600 N. May, Oklahoma
City, Oklahoma 73112, or at such other place as may be designated in writing by
the Holder of this Note, the principal sum of TWO HUNDRED THOUSAND DOLLARS
($200,000.00), together with interest thereon at the rate hereinafter stated.
THIS NOTE SUPERSEDES THE PRIOR NOTE BY THE MAKER TO THE HOLDER DATED THIS SAME
DATE. This Note will be payable as follows:

          Interest will accrue on the unpaid principal balance of this
          Note at the per annum interest rate of twelve percent (12%)
          (the "Applicable Rate"). Interest will commence to accrue on
          the date hereof and thereafter until this Note is paid in
          full. Interest will be computed for the actual number of
          days elapsed at a per diem charge based on a year consisting
          of three hundred sixty (360) days. All obligations evidenced
          by and owing pursuant to the terms of this Note, including
          principal and interest, are due and payable April 30, 2004
          (the "Maturity Date").

     Both principal and interest owing pursuant to the terms of this Note are
payable in the lawful currency of the United States of America and in
immediately available funds. All payments made on this Note will be applied to
this Note when received by the Holder hereof. Any sum not paid when due will
bear interest at the rate equal to the Applicable Rate plus six percent (6%) and
will be paid at the time of, and as a condition precedent to, the curing of any
"Default", as that term is hereinafter defined in this Note. During the
existence of any Default, the Holder of this Note may apply payments received on
any amount due hereunder or under the terms of any instrument hereafter
evidencing or securing said indebtedness as the Holder may determine.

     The Maker agrees that if, and as often as, this Note is placed in the hands
of an attorney for collection or to defend or enforce any of the Holder's rights
hereunder, the Maker will pay to the Holder all reasonable attorney's fees and
all expenses incurred by the Holder in connection therewith.

THIS NOTE IS GIVEN BY THE MAKER AND ACCEPTED BY THE HOLDER PURSUANT TO A LENDING
TRANSACTION CONTRACTED, CONSUMMATED, AND TO BE PERFORMED IN OKLAHOMA CITY,
OKLAHOMA COUNTY, OKLAHOMA, AND THIS NOTE SHALL BE CONSTRUED ACCORDING TO THE
LAWS OF THE STATE OF OKLAHOMA. The payment of all indebtedness evidenced by this
Note is unsecured. However, in the event of any Default, the Holder may request,
and the Maker agrees to furnish to the Holder, agreeable collateral and such
security agreements as the Maker may reasonably require to secure the
indebtedness.

     At the option of the Holder, the unpaid balance of this Note, and all other
obligations of the Maker to the Holder, whether direct or indirect, absolute or
contingent, now existing or hereafter arising, shall become immediately due and
payable without presentment, protest, notice or demand upon the occurrence or
existence of one or more of the following events or conditions ("Default"):

     1.   any payment required by this Note or any other note or obligation of
the Maker to the Holder or to others is not made when due in the amount
required; and

     2.   any default or breach occurs in the performance of any covenant,
obligation, representation, warranty, or provision contained in this Note or in
any other note or obligation of the Maker to Holder or to others;

     No waiver of any payment or other right under this Note by the Holder shall
operate as a waiver of any other payment or right. Any payments hereunder may,
at the option of the Holder, be recorded on this Note and shall be prima facie
evidence of such payments and the unpaid balance of this Note.

     The Maker has the right to prepay this Note in whole or in part at any time
and from time to time without premium or penalty, but with accrued interest to
the date of the prepayment on the amount prepaid.

     The Maker waives presentment for payment, protest and notice of nonpayment.

     In addition to the interest payable hereunder, Maker agrees to pay a Loan
Fee in the amount of $8,000 to Holder on the Maturity Date.

     IN WITNESS WHEREOF, the Maker has executed this instrument effective on the
date first above written.

ATTEST:                                    THE BEARD COMPANY

REBECCA G. WITCHER                         HERB MEE, JR.
Rebecca G. Witcher, Secretary              Herb Mee, Jr., President

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