Document:

Exhibit
10.11

 

Right
of First Refusal Agreement

 

This  Right of First Refusal Agreement  (the
“Agreement”) is made in Beijing on November 5, 2010 by and between:

 

Party
A:

 

Beijing
Bona International Cineplex Investment and Management Co., Ltd.

Legal
Representative: Yu Dong

Domicile: Suite 61-62, F/18,
Poly Plaza, Road No. 14, Dongzhimen, Nandajie,

Dongcheng District, Beijing

 

Party B:

 

Yu Dong

ID No.: 

Domicile:
Suite 1, F/10, Building 10, Dongda Qiao, Chaoyang District, Beijing

 

Xu Yang

ID No.: 

Domicile:
5 Xiaoshuan Hutong, Xicheng District, Beijing

 

Zhejiang
Intime Rich Investment Co., Ltd

Legal
Representative: Tang Shuning

Address:
501 Fuqiang Road, Yinzhou Tou Zi Chuang Ye Center, Ningbo

 

Zhejiang
Kunyuan Investment Consulting Co., Ltd.

Legal
Representative: Cao Guoxiong

Address: Suite 202,
Block A, Building 3, Liu Shui Dong Yuan, Hangzhou

 

Guoheng
Fashion Media Science & Technology Group Corp.

Legal
Representative:  Liu Bo

Address: Suite 903, China International Science and Technology 

Convention Center , 12 Yuming Road, Chaoyang District, Beijing

 

Party
C:

Beijing
Bona Starlight Cineplex Management Co., Ltd.

Legal
Representative: Yu Dong

Domicile:
Suite 1866, F/18, Poly
Plaza, Road No. 14, Dongzhimen, Nandajie, 

Dongcheng District, Beijing

 

(each a “Party”, collectively the “Parties”)

 

WHEREAS,

 

 

1. 
Party C is a limited liability company organized under the PRC laws in
2010 in Beijing, and its business scope covers cinema management (exclusive of
film screening); organization of cultural and artistic exchange activities
(exclusive of shows); organizing of exhibitions and expositions; investment
management; advertisement creation, agency and placement services, etc.;

 

2. 
Party B is the shareholder of Party C, holding 100% equity interest in
Party C;

 

3. 
Party B and Party C desire to grant Party A the right of first refusal
with respect to capital increase of Party C, transfer by Party B of its equity
interest in Party C and transfer by Party C of its assets and Party A agrees to
accept the grant of such right of first refusal.

 

NOW, THEREFORE, by mutual
consultation and agreement, the Parties agree as follows:

 

1. 
Right of First Refusal with Respect to Capital Increase

 

1.1 During the term of this
Agreement, if Party C proposes to increase its registered capital, Party B
shall the right of first refusal with respect to such capital increase by Party
C and shall have the right to subscribe for such capital increase of Party C in
proportion to its equity interest in Party C, provided, however, that none of
the parties comprising Party B shall subscribe for a greater percentage of the
capital increase than the percentage of the equity interest held by it in Party
C prior to such capital increase. Party B and Party C agree that if one or more
of the parties comprising Party B waive the exercise of, or fail to fully
exercise, their right of first refusal, Party A shall have the right of first
refusal with respect to the unsubscribed portion of such capital increase.

 

1.2     For the purpose of Article 1.1 above,
when and if Party C intends to increase its registered capital, it shall give
Party A and Party B written notice (“Capital Increase Notice”), which shall in
reasonable detail describe the amount of the proposed capital increase (“Capital
Increase”) and its price.

 

1.3     Party B may within 15 days from receipt of
the Capital Increase Notice (“Capital Increase Period”) exercise its right of
first refusal by written notice to Party C and thereby subscribes for the
Capital Increase at the price specified in the Capital Increase Notice.  None of the parties comprising Party B shall
subscribe for a greater percentage of the capital increase than the percentage
of the equity interest held by it in Party C prior to such capital increase.

 

1.4  
If Party B explicitly states in writing that it will not exercise its
right of first refusal, or that it has decided to subscribe for a part of the
Capital Increase only, or if Party B has failed to give Party C within the
Capital Increase Period notice of its exercise of its right of first refusal,
Party A shall then be entitled to subscribe for, at the price set out in the
Capital Increase Notice, any portion of the Capital Increase which has not been
subscribed for by Party B.

 

2

 

1.5  
If Party A fails to exercise or does not fully exercise its right of
first refusal, Party C shall be entitled to accept subscription by a third
party for any remaining portion of the Capital Increase, provided however that:
(1) such third party shall be approved by the shareholders’ meeting of
Party C; (2) such third party shall subscribe for the Capital Increase at
a price no less than the price set out in the Capital Increase Notice; (3) such
third party shall agree in writing to be bound by all of the obligations of
Party B hereunder, and shall acknowledge Party A’s right of first refusal
hereunder (including without limitation Party A’s right of first refusal with
respect to equity transfer by such third party); and (4) the Capital Increase
shall be consummated within 30 days from the expiry of the Capital Increase
Period.

 

2. 
Right of First Refusal with Respect to Equity Transfer

 

2.1 Party B agrees to grant to Party
A during the term of this Agreement the right of first refusal with which to
purchase at the same price any equity interest in Party C proposed for transfer
and Party A agrees to accept the grant of such right of first refusal. If,
during the term of this Agreement, one or more parties comprising Party B (“Proposing
Equity Transferor”) propose to transfer all or part of their equity interest in
Party C, Party A shall have the right of first refusal with respect to such
equity proposed for transfer and Party B shall not rely on its capacity as the
shareholder of Party C to assert any preemptive right against Party A to
purchase, on a prior basis, such equity proposed for transfer.

 

2.2  
For the purpose of Article 2.1 above, when and if the Proposing
Equity Transferor intends to transfer its equity interest in Party C, it shall
give Party A, the parties comprising Party B (other than the Proposing Equity
Transferors) and Party C written notice (“Equity Transfer Notice”), which shall
in reasonable detail describe the percentage of the equity interest proposed
for transfer (“Equity Proposed for Transfer”), the original equity interest
holder, the proposed transfer price and the proposed transferee.

 

2.3  
Party A may within 15 days from receipt of the Equity Transfer Notice (“Equity
Transfer Period”) exercise its right of first refusal by written notice to the
Proposing Equity Transferors and Party C and thereby purchases all or part of
the Equity Proposed for Transfer at the price specified in the Equity Transfer
Notice.

 

2.4    If Party A explicitly states in writing
that it will not exercise its right of first refusal with respect to the Equity
Proposed for Transfer, or that it has decided to purchase a part of the Equity
Proposed for Transfer only, or if Party A has failed to give the Proposing
Equity Transferors and Party C within the Equity Transfer Period notice of its
exercise of its right of first refusal, the parties comprising Party B (other
than the Proposing Equity Transferors) shall then be entitled to purchase, at
the price set out in the Equity Transfer Notice, any portion of the Equity
Proposed for Transfer which has not been purchased by Party A in proportion to
their respective equity interests in Party C. If one or more of the parties
comprising Party B waive or fail to fully exercise their right of first
refusal, the un-purchased Equity Proposed for Transfer may be allocated among
the parties comprising Party B which have fully exercised their right of first
refusal in proportion to their respective equity interests. Notwithstanding the
foregoing, all of the parties comprising Party B agree that Yu Dong shall have
the right to transfer to a third

 

3

 

party up to 19.6554% of the equity
interest in Party C (all of which is held by Yu Dong in Party C) without being
subjected to any right of first refusal of the other parties comprising Party B
as set out in this Article 2.4.

 

2.5  
If Party B fails to exercise or does not fully exercise its right of
first refusal, the Proposing Equity Transferors shall be entitled to transfer
to the proposed transferee set out in the Equity Transfer Notice any remaining
portion of the Equity Proposed for Transfer, provided however that: (1) such
proposed transferee shall purchase the Equity Proposed for Transfer at a price
no less than the price set out in the Equity Transfer Notice; (2) such
proposed transferee shall agree in writing to be bound by all of the
obligations of Party B hereunder, and shall acknowledge Party A’s right of
first refusal hereunder (including without limitation Party A’s right of first
refusal with respect to equity transfer by such proposed transferee); and (3) the
transfer shall be consummated within 30 days from the expiry of the Equity
Transfer Period.

 

3. 
Right of First Refusal with Respect to Assets

 

3.1 Party B and Party C agree to
grant to Party A during the term of this Agreement the right of first refusal
with which to purchase at the same price the cinemas of Party C and Party A
agrees to accept the grant of such right of first refusal. If, during the term of
this Agreement, Party C proposes to transfer any cinema owned by it or any of
its subsidiaries under its direct or indirect control, or if, during the term
of this Agreement, any of the direct or indirect subsidiaries of Party C
proposes to transfer any cinema owned by it (the foregoing assets proposed for
transfer, “Cinema Assets”), Party A shall have the right of first refusal with
respect to such assets proposed for transfer.

 

3.2  
For the purpose of Article 3.1 above, when and if the Party C or
its subsidiary intends to transfer any Cinema Assets, Party C shall give Party
A written notice (“Asset Transfer Notice”), which shall in reasonable detail
describe the status of the Cinema Assets proposed for transfer, the original
holder of such assets, the proposed transfer price and the proposed transferee.

 

3.3  
Party A may within 15 days from receipt of the Asset Transfer Notice (“Asset
Transfer Period”) exercise its right of first refusal by written notice to
Party C and thereby purchases the Cinema Assets proposed for transfer at the
price specified in such Asset Transfer Notice.

 

3.4    If Party A explicitly states in writing
that it will not exercise its right of first refusal with respect to the Cinema
Assets proposed for transfer, or if Party A has failed to give Party C within
the Asset Transfer Period notice of its exercise of its right of first refusal,
Party C or its subsidiary, as the case may be, shall be entitled to transfer
the Cinema Assets to the proposed transferee set out in the Assets Transfer
Notice, provided however that: (1) such proposed transferee shall purchase
the Cinema Assets at a price no less than the price set out in the Asset
Transfer Notice; (2) the transfer shall be consummated within 30 days from
the expiry of the Asset Transfer Period.

 

4

 

3.5     Party C shall cause its direct or indirect
subsidiaries to comply with the provisions of this Article 3.

 

4.  
Further Undertakings

 

The Parties agree to each take all
such actions and execute all such documents and instruments as are necessary
for the performance of any provision hereof. Party C further agrees to cause
its direct or indirect subsidiaries to take all such actions and execute all
such documents and instruments as are necessary for the performance of any
provision hereof.

 

5.  
Confidentiality

 

5.1    The Parties acknowledge and confirm that
any and all oral or written information exchanged among them in connection with
the execution and/or performance of this Agreement shall be treated as
confidential information.  The Parties
shall each maintain such information in confidence and shall not disclose it to
any third party without written consent of the other Parties, except where: (i) such
information is already known or will be known by the public (other than as a
result of any un-authorized disclosure to the public by any receiving Party of
such information); (2)  such information is required to be disclosed in
accordance with applicable laws and regulations or the rules and statutes
of the stock exchanges; or (3) such information is disclosed by any Party
hereto to its legal or financial advisor as needed by the transactions
contemplated hereunder, provided that such advisors are bound by similar
confidentiality obligations to those set forth in this Article 5.1.
Unauthorized divulgation by any employee, intermediary or representative
employed or engaged by any Party hereto shall be deemed unauthorized
divulgation by such Party and such Party shall assume breach of contract
liabilities in accordance with this Agreement. 
This Article 5.1 shall survive any termination of this Agreement
for any reason. The Parties may each in their discretion refuse to grant such
consent, and any failure by any Party hereto to respond to any disclosure
request of any other Party hereto shall be deemed a refusal by such Party.

 

5.2      The Parties agree that this Article 5
shall survive the termination of this Agreement.

 

6.   
Representations and Warranties

 

6.1  
Party A hereby represents and warrants that:

 

6.1.1   It is a company lawfully organized and
validly existing under the laws of PRC;

 

6.1.2   It has taken such corporate actions and
obtained such authorizations as are necessary or appropriate for the execution
of this Agreement.

 

6.2  
Party B hereby represents and warrants that:

 

5

 

6.2.1   All of the companies comprising Party B are
each a company lawfully organized and validly existing under the laws of PRC;
and all individuals comprising Party B are each a PRC citizen;

 

6.2.2   It lawfully holds 100% equity interest in
Party C and has the right to dispose of such equity interest;

 

6.2.3   All of the companies comprising Party B have
each such corporate actions and obtained such authorizations as are necessary
or appropriate for the execution of this Agreement.

 

6.3  
Party C hereby represents and warrants that:

 

6.3.1   It is a company lawfully organized and
validly existing under the laws of PRC;

 

6.3.2   It has taken such corporate actions and
obtained such authorizations as are necessary or appropriate for the execution
of this Agreement.

 

7. 
Effectiveness

 

7.1    This Agreement shall be executed and become
effective on the date first above written.

 

7.2   Unless terminated
by Party A in writing, this Agreement shall remain effective at all times.

 

8. 
Governing Law and Dispute Resolution

 

8.1    The execution, validity, interpretation,
performance, amendment, termination and dispute resolution of this Agreement
shall be governed by the laws of the People’s Republic of China.

 

8.2  
Any
dispute arising out of or in connection with the interpretation and performance
of this Agreement shall first be settled by the Parties through consultation.
In case no settlement can be reached within 30 days after giving a written
notice by one Party to the other Parties requesting the settlement through
consultation, then any Party may submit such matter to China International
Economic and Trade Arbitration Commission (“CIETAC”) for arbitration in accordance
with the arbitration rules thereof. The arbitration shall take place in
Beijing, and be conducted in Chinese. The arbitration award shall be final and
binding upon the Parties.

 

8.3    In the event of any dispute arising out of the
interpretation and performance of this Agreement or pending arbitration, apart from the matter in dispute, the Parties hereto shall
continue to exercise their respective remaining rights hereunder and perform
their respective remaining obligations hereunder.

 

6

 

8.4  
The Parties hereby agree that this Article shall survive the
termination of this Agreement.

 

9. 
Notices

 

9.1    Any notice or other communication given by any
Party to any other Party hereunder or in connection herewith shall be made in
writing and signed by the notifying Party or its representative. Such notice
shall be sent by fax to the number set forth in Article 9.2 below, or by
personal delivery or courier service to the address set forth in Article 9.2
below, and in each case indicating the recipient as the relevant party set
forth in Article 9.2 below (or such other number, address or relevant
party as otherwise notified from time to time pursuant to this Article 9).
Any notice sent by personal delivery, fax or mail shall be deemed duly given as
follows:

 

(i)              upon receipt, if by personal
delivery;

 

(ii)             upon transmission, if by fax;

 

(iii)            fourth business days after the
mailing date, if by courier service,

 

provided that, in each case, any notice
given by personal delivery or facsimile transmission on any business day after
6:00 p.m. or a non business day shall be deemed to have been received at
9:00 a.m. on the next business day.

 

9.2  
For purposes of notices, the Parties’ addresses shall be as follows:

 

Party A:   Beijing Bona International Cineplex Investment and
Management Co., Ltd.

Address:  Suite 61-62,
F/18, Poly Plaza, 14
Dongzhimen Nandajie, Dongcheng District, Beijing

Fax:  010-59283383

Attention:  Yu Dong

 

Party
B:

 

Yu
Dong

Address:   F/11, Wanqikonggu Building, 105 Yaojiayuan
Road, Chaoyang District, Beijing

Fax:  010-59283383

Attention:  Yu Dong

 

Xu
Yang

 

7

 

Address:   F/16, Wanqikonggu Building, 105 Yaojiayuan
Road, Chaoyang District, Beijing

Fax:  010-59217909

Attention:  Xu Yang

 

Zhejiang
Intime Rich Investment Co., Ltd.

Address:  Suite 1323,
Hualian Office Building, 55 Dongdu Road, Ningbo

Fax: 0574-87093878

Attention:   Tang Shuning

 

Zhejiang
Kunyuan Investment Consulting Co., Ltd.

Address:  B1501 EAC, 18 Jiaogong Road, Hangzhou

Fax:  0571-86982570

Attention:  Cao Guoxiong

 

Guoheng
Fashion Media Science & Technology Group Corp.

Address:   Suite 903, China International Science
and Technology Convention Center, 12 Yumin Road, Chaoyang District, Beijing

Fax:  010-82251133-135

Attention:  Liu Bo

 

Party
C:  Beijing Bona Starlight Cineplex
Management Co., Ltd.

Domicile:
Suite 1866, F/18, Poly Plaza, 14 Dongzhimen, Nandajie, Dongcheng District,
Beijing

Fax:
010-59283383

Attention:
Yu Dong

 

9.3    Any Party may change its address for the purpose of
notice by giving notice to the other Parties pursuant to this Article.

 

10. 
Entire Agreement

 

This
Agreement and the Exhibits attached hereto constitute the entire agreement, and
supersede all other prior consultation, representation and contracts, both
written and oral, among the Parties, with respect to the subject matter hereof.

 

8

 

11. 
Assignment of Agreement

 

Without
the prior written consent of another Party, no Party shall have the right to
transfer any of its rights and/or obligations hereunder to any third party.

 

12. 
Severability

 

Any
one or more provisions of this Agreement that are held invalid, illegal or
unenforceable in any respect by any law or regulation shall not affect or
impair the validity, legality or enforceability of other provisions of this
Agreement in any respect. The
Parties hereto shall negotiate in good faith to replace such invalid, illegal or unenforceable
provisions with valid provisions as permitted by law and to the maximum extent
contemplated by the Parties, the economic effect of which shall come as close
as possible to that of such invalid, illegal or unenforceable provisions.

 

13. 
Amendment and Supplement

 

This
Agreement may not be amended, modified or supplemented except by a written instrument
signed by the Parties. Any such written amendment agreement and/or supplemental
agreement signed by the Parties shall be an integral part of this Agreement,
with the same legal validity as this Agreement.

 

14. 
Language and Counterparts

 

This
Agreement shall be executed in seven (7) copies in Chinese, each of which shall be an
original, and all of which together shall constitute one and the same document.

 

15. 
Successors

 

This Agreement shall be binding upon, and is made
for the benefit of the Parties and their respective successors and permitted
assigns.

 

16. 
Waiver

 

Any Party may waive the terms and conditions of
this Agreement, provided that such waiver shall be made in writing and signed
by such Party. Any waiver by any Party of another Party’s breach in some
circumstances shall not be deemed to be a waiver by such Party of any similar
breach in other circumstances.

 

9

 

IN WITNESS WHEREOF, the Parties have caused this Agreement
to be executed by their authorized representatives as of the date first above
written and this Agreement shall become effective immediately.

 

Party A:  
Beijing
Bona International Cineplex Investment and Management Co., Ltd.

 

 

	
  By:

  	
  /s/ Yu Dong

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Position:

  	
   

  	
   

  
				

 

 

Party B:

 

 

Yu
Dong

 

 

	
  By:

  	
  /s/ Yu Dong

  	
   

  

 

 

Xu
Yang

 

 

	
  By:

  	
  /s/ Xu Yang

  	
   

  

 

 

Zhejiang
Intime Rich Investment Co., Ltd

 

 

	
  By:

  	
  (Corporate
  Seal)

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Position:

  	
   

  	
   

  
				

 

(Signature
Page)

 

10

 

Zhejiang
Kunyuan Investment Consulting Co., Ltd.

 

 

	
  By:

  	
  (Corporate
  Seal)

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Position:

  	
   

  	
   

  
				

 

 

Guoheng
Fashion Media Science & Technology Group Corp.

 

 

	
  By:

  	
  (Seal
  by Liu Bo)

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Position:

  	
   

  	
   

  
				

 

 

Party
C:  Beijing Bona Starlight Cineplex
Management Co., Ltd.

 

 

	
  By:

  	
  (Corporate
  Seal)

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Position:

  	
   

  	
   

  
				

 

(Signature
Page)

 

11

 

Zhejiang
Kunyuan Investment Consulting Co., Ltd.

 

 

	
  By:

  	
  (Corporate
  Seal)

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Position:

  	
   

  	
   

  
				

 

 

Guoheng
Fashion Media Science & Technology Group Corp.

 

 

	
  By:

  	
  (Seal
  by Liu Bo) (Corporate Seal)

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Position:

  	
   

  	
   

  
				

 

 

Party
C:  Beijing Bona Starlight Cineplex
Management Co., Ltd.

 

 

	
  By:

  	
  (Corporate
  Seal)

  	
   

  
	
  Name:

  	
   

  	
   

  
	
  Position:

  	
   

  	
   

  
				

 

(Signature
Page)

 

12Exhibit 10.1

 

SIXTH AMENDMENT TO EMPLOYMENT AGREEMENT

 

THIS SIXTH AMENDMENT TO EMPLOYMENT AGREEMENT (“Amendment”)
is made and entered into by and between Cano
Petroleum Inc., a Delaware corporation with its principal executive
offices in Fort Worth, Texas (the “Company”),
and Michael J. Ricketts, an
individual currently residing in Tarrant County, Texas (“Employee”), effective
as of the 11th day of November, 2010 (the “Amendment Effective Date”).  Capitalized terms not otherwise defined
herein shall have the meaning ascribed to them in the below described
Agreement.

 

WHEREAS, the Company and Employee entered into that certain
Employment Agreement dated July 1, 2006, and subsequent amendments thereto
(the “Agreement”); and

 

WHEREAS, the Company and Employee now desire to amend,
alter, modify and change the terms and provisions of the Agreement, as follows.

 

NOW THEREFORE, for and in consideration of the mutual
benefits to be obtained hereunder and other good and valuable consideration,
the receipt and sufficiency of which are hereby acknowledged and confessed,
Company and Employee do hereby agree to amend, alter, modify and change the
Agreement, as of the Amendment Effective Date as follows:

 

1.             Section 1. Employment.
shall be deleted in its entirety and the following substituted in place and in
lieu thereof.

 

1.             Employment.  The Company hereby employs Employee in the
capacity of Sr. Vice President and Chief Financial Officer, and Employee hereby
agrees to accept such employment by the Company, upon the terms and conditions
stated in this Agreement.

 

2.             Section 4. (a) shall be
deleted in its entirety and the following substituted in place and in lieu
thereof.

 

4.             Compensation.

 

(a)           Salary:  The Company shall pay Employee for his
services, as base salary, on an annualized basis, of $200,000.00 (Two Hundred
Thousand Dollars) per annum for the period from the Effective Date, which
salary shall be payable by the Company in substantially equal installments on
the Company’s normal payroll dates.  All
applicable federal, state and local taxation guidelines.

 

Except
as specifically amended, altered, modified and changed hereby and heretofore,
the Agreement remains in full force and effect as originally written.

 

Remainder of Page Intentionally Blank

Signatures Follow

 

 

Signatures

 

To
evidence the binding effect of the covenants and agreements described above,
the parties hereto have executed this Amendment effective as of the date first
above written.

 

 

	
   

  	
   

  	
  THE
  COMPANY:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  CANO PETROLEUM, INC.

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  By:

  	
  /s/ S. Jeffrey Johnson

  
	
   

  	
   

  	
   

  	
  S.
  Jeffrey Johnson

  
	
   

  	
   

  	
   

  	
  Chairman
  and Chief Executive Officer

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  EMPLOYEE:

  
	
   

  	
   

  	
   

  
	
   

  	
   

  	
  /s/
  Michael J. Ricketts

  
	
   

  	
   

  	
  Michael J. Ricketts

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