Document:

Exhibit 10.1.4

 

Exhibit A

SCHEDULE OF PARTNERS,

ALLOCATION OF PARTNERSHIP UNITS, PERCENTAGE
INTERESTS

AND THE AGREED UPON VALUE OF NON-CASH
INTERCOMPANY ADVANCES

 

	
  Date Admitted

  	
   

  	
  Name and address of partners

  	
   

  	
  Value of

  non-cash

  intercompany

  advance

  	
   

  	
  Partnership

  units issued

  	
   

  	
  Approx.

  Percentage

  Interests

  	
   

  	
  Federal ID #

  	
   

  
	
  05/22/1998(1)

  	
   

  	
  Eagle Ridge
  Resort LLC

  37 West 57th Street,

  12th Floor

  New York, NY 10019

  	
   

  	
  $

  	
  1,198,750

  	
   

  	
  35,794

  	
   

  	
  0.49

  	
  %

  	
  52-2099405

  	
   

  
	
  02/04/1997

  	
   

  	
  GTA LP, Inc.

  14 North Adger’s Wharf

  Charleston, SC 29401

  	
   

  	
  $

  	
  —

  	
   

  	
  7,302,479

  	
   

  	
  99.31

  	
  %

  	
  58-2290326

  	
   

  
	
  02/04/1997

  	
   

  	
  GTA GP, Inc.

  14 North Adger’s Wharf

  Charleston, SC 29401

  	
   

  	
  $

  	
  —

  	
   

  	
  14,684

  	
   

  	
  0.20

  	
  %

  	
  58-2290217

  	
   

  
	
  Total Common OP Units

  	
   

  	
   

  	
   

  	
   

  	
   

  	
  7,352,957

  	
   

  	
  100.00

  	
  %

  	
   

  	
   

  
	
   

  	
   

  	
  GTA LP, Inc.

  10 North Adger’s Wharf

  Charleston, SC 29401

  	
   

  	
  $

  	
  20,000,000

  	
   

  	
  800,000

  	
   

  	
  100

  	
  %

  	
   

  	
   

  

 

(1)  transferred from Eagle Ridge
Lease Company, LLC to current holder effective April 1, 2004.Exhibit 10.7

 

AMENDMENT NO. 2, ASSIGNMENT AND AGREEMENT

 

This AMENDMENT NO. 2,
ASSIGNMENT AND AGREEMENT (“Agreement”) dated as of April 28, 2006 (“Effective
Date”) is among Cano Petroleum, Inc., a Delaware corporation (“Borrower”), the
Guarantors (as defined below), the Lenders (as defined below), and Union Bank
of California, N.A., as administrative agent for such Lenders (in such
capacity, the “Administrative Agent”) and as issuing lender (in such capacity,
the “Issuing Lender”). 

 

RECITALS

 

A.            The Borrower is party to
that certain Credit Agreement dated as of November 29, 2005, as amended by the
Amendment No. 1 dated as of February 24, 2006 (as so amended, the “Credit
Agreement”) among the Borrower, the lenders party thereto from time to time
(the “Lenders”), the Administrative Agent, and the Issuing Lender.  

 

B.            In connection with such
Credit Agreement, Square One Energy, Inc., Ladder Companies, Inc., W.O. Energy
of Nevada, Inc., WO Energy, Inc., W.O. Operating Company, Ltd, W.O. Production
Company, Ltd, and Pantwist, LLC (collectively, the “Guarantors” and
individually, a “Guarantor”) executed and delivered a Guaranty Agreement dated
as of November 29, 2005 in favor of the Administrative Agent for the ratable
benefit of the Beneficiaries (as defined therein), as supplemented by that
certain Supplement No. 1 dated of even date herewith made by Pantwist, LLC as a
new Guarantor (as so supplemented, the “Guaranty”).

 

C.            Pantwist, LLC intends to
acquire certain oil and gas assets located in the State of Texas from Myriad
Resources Corporation and affiliates thereof (the “Acquisition”) pursuant to
the terms of that certain Asset Purchase and Sale Agreement among Myriad
Resources Corporation, Westland Energy Company, and PAMTEX, a Texas general
partnership composed of PAMTEX GP1 Ltd. and PAMTEX GP2 Ltd. as sellers, and the
Borrower as the purchaser and dated April 25, 2006, as assigned from the
Borrower to Pantwist, LLC (the “PSA”).

 

D.            The Borrower has requested
that the Lenders increase the Borrowing Base (as defined in the Credit
Agreement) in order to use the proceeds from loans under the Credit Agreement
to fund the Acquisition.

 

E.             In
connection with the Credit Agreement, Natexis Banques Popularies, as a Lender
under the Credit Agreement (“Assignor”) wishes to assign a certain percentage
of its rights and obligations under the Credit Agreement as a Lender to Union
Bank of California, N.A., as a Lender under the Credit Agreement (“Assignee”).

 

F.             After giving effect to such assignment from the
Assignor to the Assignee as provided herein, the Borrower, the Lenders and
the Administrative Agent wish to, subject to the terms and conditions of this Agreement, (1) increase
the Borrowing Base as provided herein, and (2) make certain other amendments to
the Credit Agreement as provided herein.

 

 

THEREFORE,
the Borrower, the Guarantors, the Lenders, and the Administrative Agent hereby
agree as follows:

 

Section 1.              Defined
Terms.  As used in
this Agreement, each of the terms defined in the opening paragraph and the
Recitals above shall have the meanings assigned to such terms therein.  Each term defined in the Credit Agreement and
used herein without definition shall have the meaning assigned to such term in
the Credit Agreement, unless expressly provided to the contrary.

 

Section 2.              Other
Definitional Provisions. Article, Section, Schedule,
and Exhibit references are to Articles and Sections of and Schedules and
Exhibits to this Agreement, unless otherwise specified.  All references to instruments, documents,
contracts, and agreements are references to such instruments, documents,
contracts, and agreements as the same may be amended, supplemented, and
otherwise modified from time to time, unless otherwise specified.  The words “hereof”, “herein”, and “hereunder”
and words of similar import when used in this Agreement shall refer to this
Agreement as a whole and not to any particular provision of this
Agreement.  The term “including” means “including,
without limitation,”.  Paragraph headings
have been inserted in this Agreement as a matter of convenience for reference
only and it is agreed that such paragraph headings are not a part of this
Agreement and shall not be used in the interpretation of any provision of this
Agreement.

 

Section
3.              Assignment.  Assignor hereby sells and assigns to Assignee, without
recourse and without representation or warranty other than as expressly
provided herein, and the Assignee hereby purchases and assumes from Assignor,
such percentage in and to all of the Assignor’s rights and obligations under
the Credit Agreement as a Lender (including, without limitation, such
percentage interest in the Advances owing to the Assignor and the Assignor’s
risk participation and funded participation in Letter of Credit Obligations
existing as of the date hereof (prior to the effectiveness of this Agreement)
that would result in the Assignor and the Assignee having the respective
Commitments set forth next to its name on the signature page hereof.  After giving effect to the sale and
assignment pursuant to this Section 3, each Lender’s respective Commitment will
be as set forth next to its name on the signature page hereof.  Assignor (i) represents and warrants that it
is the legal and beneficial owner of the interest being assigned by it hereunder
and that such interest is free and clear of any adverse claim; (ii) makes no
representation or warranty and assumes no responsibility with respect to any
statements, warranties or representations made in or in connection with the
Credit Agreement, the other Loan Documents or any other instrument or document
furnished pursuant thereto or in connection therewith, or the execution,
legality, validity, enforceability, genuineness, sufficiency or value of, or
the perfection or priority of any Lien created or purported to be created under
or in connection with, the Credit Agreement, any of the other Loan Documents or
any other instrument or document furnished pursuant thereto or in connection
therewith; and (iii) makes no representation or warranty and assumes no
responsibility with respect to the financial condition of Borrower or any other
Person or the performance or observance by Borrower or any other Person of any
of its respective obligations under the Credit Agreement, any of the other Loan
Documents or any other instrument or document furnished pursuant thereto or in
connection therewith.  The Assignee
agrees that it will, independently and without reliance upon the Assignor and
based on such documents and information as it shall deem appropriate at the
time,

 

2

 

continue to make its own credit decisions in taking or
not taking action under the Credit Agreement, any of the other Loan Documents
or any other instrument or document.

 

Section 4.              Amendments to Credit Agreement. 

 

(a)           Section 1.01 of
the Credit Agreement is amended by inserting the following new definitions in
alphabetical order:

 

“Amendment No. 2” means the Amendment No. 2 and Agreement dated
as of April 28, 2006 among the Borrower, the Guarantors, the Lenders, the
Administrative Agent and the Issuing Lender, which amends this Agreement.

 

“Twister Oil and Gas Properties” means the Oil and Gas
Properties acquired by Pantwist, LLC from Myriad Resources Corporation and
certain affiliates thereof pursuant to that certain Asset Purchase and Sale
Agreement among Myriad Resources Corporation, Westland Energy Company, and
PAMTEX, a Texas general partnership composed of PAMTEX GP1 Ltd. and PAMTEX GP2
Ltd. as sellers, and the Borrower as the purchaser and dated April 25, 2006 and
assigned by the Borrower to Pantwist, LLC.

 

(b)           The last
sentence of Section 2.02(a) of the Credit Agreement is deleted in its entirety
and replaced with the following:

 

The Borrowing Base shall be determined in accordance with the standards
set forth in Section 2.02(d), is subject to periodic redetermination pursuant
to Sections 2.02(b) and 2.02(c), and shall automatically reduce as set forth in
Section 2.02(e).

 

(c)           Section 2.02 of the Credit Agreement is
hereby amended by adding the following new clause (e) to the end thereof:

 

(e)           Notwithstanding anything herein
to the contrary, the Borrowing Base shall automatically, and without any
requirement or condition or notice to the Borrower (which the
Borrower hereby expressly waives), decrease by $5,000,000  effective as of December 31, 2006.

 

(d)           Section 2.05 of the Credit Agreement is
hereby amended by adding the following new clause (f) to the end thereof:

 

(f)            Triggered Mandatory Prepayment. 
If, as of a fiscal quarter end occurring after the effective date of
Amendment No. 2, and calculated pursuant to Section 6.18 hereof, the ratio of
the Borrower’s consolidated Debt to consolidated EBITDA exceeds 3.00 to 1.00,
then on or prior to the immediately following fiscal quarter end, the Borrower
shall prepay the Advances or, if the Advances have been repaid in full, make
deposits into the Cash Collateral Account to provide cash collateral for the
Letter of Credit Exposure, in an amount equal to the greater of (i) $20,000,000
and (ii) an amount necessary to cause the ratio of the Borrower’s consolidated
Debt to consolidated EBITDA to be less than 3.00 to

 

3

 

1.00.  The prepayment required
pursuant to this Section 2.05(f) shall be accompanied by accrued interest
on the amount prepaid to the date of such prepayment and amounts, if any,
required to be paid pursuant to Section 2.12 as a result of such
prepayment being made on such date.  Such
prepayment shall be applied to the Advances as determined by the Administrative
Agent and agreed to by the Lenders in their sole discretion.  Once
a prepayment, together with interest and costs, as required herein, is made
pursuant to this Section 2.05(f), this Section 2.05(f) shall cease to apply.

 

(e)           Section 4.07(a)
of the Credit Agreement is hereby amended by deleting the first sentence
thereof in its entirety and replacing it with the following:

 

There is no pending or, to the best knowledge of the Borrower,
threatened action or proceeding affecting the Borrower or any of the Guarantors
before any court, Governmental Authority or arbitrator which could reasonably
be expected to cause a Material Adverse Change other than as set forth in
Schedule 4.07 or which purports to affect the legality, validity, binding
effect or enforceability of this Agreement, any Note, or any other Loan
Document.

 

(f)            Section 5.06(d)
of the Credit Agreement is deleted in its entirety and replaced with the
following:

 

(d)          Production and Hedging Reports.  As soon as available and in
any event within 45 days after the end of each fiscal quarter, commencing with
the fiscal quarter ending March 31, 2006, a report certified by a Responsible
Officer of the Borrower in form and substance satisfactory to the
Administrative Agent prepared by the Borrower (i) covering each of the Oil and
Gas Properties of the Borrower and its Subsidiaries (other than the Barnett
Shale Properties) and detailing on a quarterly basis (A) the production,
revenue, and price information and associated operating expenses for each such
quarter, (B) any changes to any producing reservoir, production equipment, or
producing well during each such quarter, which changes could cause a Material
Adverse Change, and (C) any sales of the Borrower’s or any Subsidiaries’ Oil
and Gas Properties during each such quarter (other than the Barnett Shale
Properties), (ii) setting forth a true and complete list of all Hedge Contracts
of the Borrower and its Subsidiaries and detailing the material terms thereof
(including the type, term, effective date, termination date and notional
amounts or volumes), the net mark to market value thereof, all credit support
agreements relating thereto (including any margin required or supplied), and
the counterparty to each such agreement, and (iii) certifying the Borrower’s
compliance with Section 5.12 hereof.

 

(g)           Section 5.12 of
the Credit Agreement is deleted in its entirety and replaced with the
following:

 

4

 

Section 5.12         Hedging Arrangements.  The Borrower shall:

 

(a) maintain the Hydrocarbon Hedge Agreements in existence on March 31,
2006 and as described in Schedule 5.12 for a minimum period of at least three
years as of the end of December 31, 2006 and as of the end of each six month
period ending thereafter, 

 

(b) on or before 10 days following the effective date of Amendment No.
2, cause Pantwist, LLC to enter into, and from and after such date, maintain
(i) Hydrocarbon Hedge Agreements covering not less than 50% of the “proved,
developed and producing” crude oil reserves attributable to the Twister Oil and
Gas Properties for a minimum period of at least three years as of the effective
date of Amendment No. 2 and as of the end of each two fiscal quarter period
ending thereafter, and at a minimum floor of $60 per Bbl, and (ii) Hydrocarbon
Hedge Agreements covering not less than 50% of the “proved, developed and
producing” natural gas reserves attributable to the Twister Oil and Gas
Properties for a minimum period of at least three years as of the effective
date of Amendment No. 2 and as of the end of each two fiscal quarter period
ending thereafter, and with a weighted average contract price of $7.60 per Mcf,
and 

 

(c) notwithstanding any of the foregoing, maintain Hydrocarbon Hedge
Agreements covering no less than 50% and no more than 80% of the production
volumes attributable to “proved, developed and producing” Proven Reserves of
the Borrower’s and its Subsidiaries’ Oil and Gas Properties.

 

(h)           A new Schedule
4.07 to the Credit Agreement is added as set forth in Schedule 4.07 attached to
this Agreement.

 

(i)            Schedule 4.21 to the Credit Agreement is
replaced in its entirety with the Schedule 4.21 attached to this Agreement.

 

Section 5.              Increase
in the Borrowing Base. 
Subject to the terms of this Agreement, the Lenders and the Borrower
hereby agree that as of the Effective Date the Borrowing Base shall be
$55,000,000 and such Borrowing Base shall remain in effect at that level until
the Borrowing Base is redetermined or reduced in accordance with the Credit
Agreement, as amended hereby.

 

Section 6.              Borrower Representations and Warranties.  The Borrower represents and warrants that:
(a) the representations and warranties contained in the Credit Agreement and
the representations and warranties contained in the other Loan Documents, as
amended hereby, are true and correct in all material respects on and as of the
Effective Date as if made on as and as of such date except to the extent that any such representation or
warranty expressly relates solely to an earlier date, in which case such
representation or warranty is true and correct in all material respects as of
such earlier date; (b) no Default has occurred and is continuing; (c) the execution,
delivery and performance of this Agreement are within the corporate power and
authority of the Borrower and have been duly authorized by appropriate
corporate and governing action and proceedings; (d) this Agreement constitutes
the legal, valid, and binding obligation of the Borrower enforceable in
accordance with its terms, except as limited by applicable bankruptcy,
insolvency, reorganization, moratorium, or similar laws affecting the rights of

 

5

 

creditors generally and
general principles of equity; (e) there are no governmental or other third
party consents, licenses and approvals required in connection with the
execution, delivery, performance, validity and enforceability of this
Agreement; and (f) the Liens under the Security Instruments are valid and
subsisting and secure Borrower’s obligations under the Loan Documents.

 

Section 7.              Guarantors Representations and Warranties.  Each Guarantor represents and warrants that:
(a) the representations and warranties contained in the Guaranty and the
representations and warranties contained in the other Loan Documents, as
amended hereby, are true and correct in all material respects on and as of the
Effective Date as if made on as and as of such date except to the extent that any such representation or
warranty expressly relates solely to an earlier date, in which case such
representation or warranty is true and correct in all material respects as of
such earlier date; (b) no Default has occurred and is continuing; (c)
the execution, delivery and performance of this Agreement are within the corporate,
limited liability company, or partnership power and authority of such Guarantor
and have been duly authorized by appropriate corporate, limited liability
company, or partnership action and proceedings; (d) this Agreement constitutes
the legal, valid, and binding obligation of such Guarantor enforceable in
accordance with its terms, except as limited by applicable bankruptcy,
insolvency, reorganization, moratorium, or similar laws affecting the rights of
creditors generally and general principles of equity; (e) there are no
governmental or other third party consents, licenses and approvals required in
connection with the execution, delivery, performance, validity and
enforceability of this Agreement; (f) it has no defenses to the enforcement of
the Guaranty; and (g) the Liens under the Security Instruments are valid and
subsisting and secure such Guarantor’s and the Borrower’s obligations under the
Loan Documents.

 

Section 8.              Conditions to Effectiveness.  This Agreement, the increase
in the Borrowing Base, and the amendments to the Credit Agreement provided
herein shall become effective on the Effective Date and enforceable against the
parties hereto upon the occurrence of the following conditions precedent:

 

(a)           The Administrative Agent shall have
received multiple original counterparts, as requested by the Administrative
Agent, of this Agreement duly and validly executed and delivered by duly
authorized officers of the Borrower, the Guarantors, the Administrative Agent,
and the Lenders.

 

(b)           New Notes evidencing the new Commitments
of the Lenders as a result of the assignment effected pursuant hereto.

 

(c)           The Borrower or
the respective Guarantor shall have delivered fully executed, multiple
originals of new
Mortgages or supplements to existing Mortgages, in form and substance
acceptable to the Administrative Agent, and encumbering the Oil and Gas
Properties acquired under the Acquisition.

 

(d)           The Administrative Agent
shall have received a
fully executed, correct and complete copy of the PSA and all other documents,
agreements, instruments and amendments, if any, related thereto and certified
as such by a duly authorized officer of the Borrower.

 

6

 

(e)           The Administrative Agent shall have
received all requested lien releases, title opinions and other title due
diligence material satisfactory to it evidencing the title to the Oil and Gas
Properties to being acquired under the PSA and which are to be considered in
determining the Borrowing Base.

 

(f)            All conditions
to the effectiveness of the Acquisition, other than the payment
of the purchase price, shall have been met pursuant to the terms of the PSA.

 

(g)           No Default
shall have occurred and be continuing as of the Effective Date.

 

(h)           The
representations and warranties in this Agreement shall be true and correct in
all material respects.

 

(i)            The Borrower shall have paid (i) a
fee in the amount of $125,000 for the pro rata account of the Lenders (after
giving effect to the assignment provided herein) in consideration of the Borrowing Base increase
as required under Section 2.08(d) of the Credit Agreement, (ii) the fees
required under that certain fee letter of even date herewith between the
Administrative Agent and the Borrower, and (iii) all fees and expenses of the
Administrative Agent’s outside legal counsel and other consultants pursuant to
all invoices presented for payment on or prior to the Effective Date.

 

Section 9.              Acknowledgments and Agreements. 

 

(a)           The Borrower acknowledges that on the
date hereof all Obligations are payable without defense, offset, counterclaim
or recoupment.

 

(b)           The
Administrative Agent and the Lenders hereby expressly reserve all of their
rights, remedies, and claims under the Loan Documents.  Nothing in this Agreement shall constitute a
waiver or relinquishment of (i) any Default or Event of Default under any of
the Loan Documents, (ii) any of the agreements, terms or conditions contained
in any of the Loan Documents, (iii) any rights or remedies of the
Administrative Agent or any Lender with respect to the Loan Documents, or (iv)
the rights of the Administrative Agent or any Lender to collect the full
amounts owing to them under the Loan Documents.

 

(c)           Each of the
Borrower, the Guarantors, Administrative Agent, and Lenders does hereby adopt,
ratify, and confirm the Credit Agreement, as amended hereby, and acknowledges
and agrees that the Credit Agreement, as amended hereby, is and remains in full
force and effect, and the Borrower and the Guarantors acknowledge and agree
that their respective liabilities and obligations under the Credit Agreement,
as amended hereby, and the Guaranty, are not impaired in any respect by this
Agreement.

 

(d)           From and after
the Effective Date, all references to the Credit Agreement and the Loan Documents
shall mean such Credit Agreement and such Loan Documents as amended by this
Agreement.

 

(e)           This Agreement
is a Loan Document for the purposes of the provisions of the other Loan
Documents.  Without limiting the
foregoing, any breach of representations,

 

7

 

warranties, and covenants under this Agreement shall
be a Default or Event of Default, as applicable, under the Credit Agreement.

 

Section 10.            Reaffirmation of the Guaranty.  Each Guarantor hereby ratifies, confirms,
acknowledges and agrees that its obligations under the Guaranty are in full
force and effect and that such Guarantor continues to unconditionally and
irrevocably guarantee the full and punctual payment, when due, whether at
stated maturity or earlier by acceleration or otherwise, all of the Guaranteed
Obligations (as defined in the Guaranty), as such Guaranteed Obligations may
have been amended by this Agreement, and its execution and delivery of this
Agreement does not indicate or establish an approval or consent requirement by
such Guarantor under the Guaranty in connection with the execution and delivery
of amendments, consents or waivers to the Credit Agreement, the Notes or any of
the other Loan Documents.

 

Section 11.            Counterparts.  This Agreement may be signed in any number of
counterparts, each of which shall be an original and all of which, taken
together, constitute a single instrument. 
This Agreement may be executed by facsimile signature and all such
signatures shall be effective as originals.

 

Section 12.            Successors
and Assigns.  This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
assigns permitted pursuant to the Credit Agreement.

 

Section 13.            Invalidity.  In the event that any one or more of the
provisions contained in this Agreement shall for any reason be held invalid,
illegal or unenforceable in any respect, such invalidity, illegality or
unenforceability shall not affect any other provision of this Agreement.

 

Section 14.            Governing
Law.  This
Agreement shall be deemed to be a contract made under and shall be governed by
and construed in accordance with the laws of the State of Texas.

 

Section 15.            Entire
Agreement. THIS AGREEMENT, THE CREDIT AGREEMENT AS AMENDED BY THIS AGREEMENT, THE
NOTES, AND THE OTHER LOAN DOCUMENTS CONSTITUTE THE ENTIRE UNDERSTANDING AMONG
THE PARTIES HERETO WITH RESPECT TO THE SUBJECT MATTER HEREOF AND SUPERSEDE ANY
PRIOR AGREEMENTS, WRITTEN OR ORAL, WITH RESPECT THERETO.

 

THERE
ARE NO UNWRITTEN ORAL AGREEMENTS AMONG THE PARTIES.

 

[SIGNATURES BEGIN ON NEXT PAGE]

 

8

 

EXECUTED
effective as of the date first above written.

 

	
  BORROWER:

  	
  CANO
  PETROLEUM, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  S. Jeffrey Johnson

  	
   

  
	
   

  	
  S. Jeffrey Johnson

  
	
   

  	
  Chief Executive Officer

  
	
   

  	
   

  
	
  GUARANTORS:

  	
  SQUARE
  ONE ENERGY, INC.

  
	
   

  	
  LADDER
  COMPANIES, INC.

  
	
   

  	
  W.O.
  ENERGY OF NEVADA, INC.

  
	
   

  	
  WO
  ENERGY, INC.

  
	
   

  	
  PANTWIST,
  LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  Each by:

  	
  /s/ S. Jeffrey Johnson

  	
   

  
	
   

  	
  S. Jeffrey Johnson

  
	
   

  	
  President

  
	
   

  	
   

  
	
   

  	
  W.O.
  OPERATING COMPANY, LTD.

  
	
   

  	
  By:
  WO Energy, Inc., its general partner

  
	
   

  	
   

  
	
   

  	
       By:

  	
  /s/ S. Jeffrey Johnson

  	
   

  
	
   

  	
   S. Jeffrey Johnson

  
	
   

  	
   President

  
	
   

  	
   

  
	
   

  	
  W.O.
  PRODUCTION COMPANY, LTD.

  
	
   

  	
  By:
  WO Energy, Inc., its general partner

  
	
   

  	
   

  
	
   

  	
       By:

  	
  /s/ S. Jeffrey Johnson

  	
   

  
	
   

  	
   S. Jeffrey Johnson

  
	
   

  	
   President

  
						

 

 

Signature Page to Amendment
No. 2, Assignment and Agreement

 

 

	
  ADMINISTRATIVE AGENT/

  	
   

  
	
  ISSUING LENDER:

  	
  UNION
  BANK OF CALIFORNIA, N.A.,

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Kimberly Coil

  	
   

  
	
   

  	
  Kimberly Coil

  
	
   

  	
  Vice President

  
	
   

  	
   

  
	
   

  	
   

  
	
  $81,818,181.82

  	
  UNION
  BANK OF CALIFORNIA, N.A.,

  
	
   

  	
  as
  a Lender and as the Assignee

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/
  Kimberly Coil

  	
   

  
	
   

  	
  Kimberly Coil

  
	
   

  	
  Vice President

  

 

 

	
  $18,181,818.18

  	
  NATEXIS
  BANQUES POPULAIRES

  
	
   

  	
  as
  a Lender and as the Assignor

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Donovan C. Broussard

  	
   

  
	
   

  	
  Name:

  	
  Donovan C. Broussard

  	
   

  
	
   

  	
  Title:

  	
  Vice President & Group Manager

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Louis P. Laville, III

  	
   

  
	
   

  	
  Name:

  	
  Louis P. Laville, III

  	
   

  
	
   

  	
  Title:

  	
  Vice President & Group Manager

  	
   

  
						

 

 

SCHEDULE 4.07

 

LITIGATION

 

On
March 24, 2006, the Borrower and certain of the Guarantors were sued for claims
relating to the March fires that occurred on properties operated by W.O.
Operating Company, Ltd.  The case is
entitled: In the 100th Judicial
District Court of Carson County, Texas, Cause No. 9840, The Tom L. and Anne
Burnett Trust, by Anne Burnett Windfohr, Windi Phillips, Ben Fortson, Jr.,
George Beggs, III and Ed Hudson, Jr., as Co-Trustees; Anne Burnett Windfohr;
and Burnett Ranches, Ltd., Plaintiffs, v. Cano Petroleum, Inc., W.O. Energy of
Nevada, Inc.; W.O. Operating Company, Ltd. and W.O. Energy, Inc., Defendants.

 

On
April 13, 2006, the Borrower and certain of the Guarantors received notice that
they were sued for claims relating to the March fires that occurred on
properties operated by W.O. Operating Company, Ltd.  As of this date, neither the Borrower nor any
of the Guarantors have been served with process in this case.  The case is entitled: Joseph Craig Hutchison, et ux vs. Cano Petroleum,
Inc., W.O. Energy of Nevada, Inc.; W.O. Operating Company, Ltd. and W.O. Energy,
Inc.  The plaintiffs’ attorney
has also indicated that he will be adding two additional plaintiffs in this
case, the Chisum Family Limited Partnership and the Haggard Trust.

 

 

SCHEDULE 4.21

 

MATERIAL AGREEMENTS

 

Engagement for
Professional Services by and between Cano Petroleum, Inc. and Bainbridge
Capital dated April 14, 2005.

 

Gas Purchase and
Processing Agreement by and between Ladder Energy Company and ScissorTail
Energy, LLC dated September 1, 2004.

 

Gas Sales and Purchase
Agreement by and between Alliant Energy Desdemona, LP and KenMor Properties,
LLC dated March 1, 2005.

 

Agreement by and between
Square One Energy, Inc. and KenMor Properties, LLC dated October 7, 2005 (in
which KenMor Properties, LLC assigns, transfers and conveys to Square One
Energy, Inc. all of its right, title and interest in and to the Gas Sales and
Purchase Agreement by and between Alliant Energy Desdemona, LP and KenMor
Properties, LLC dated March 1, 2005), as amended by a First Amendment to
Agreement dated October 7, 2005.

 

Gas Purchase Contract by
and between Ladder Energy Company and Western Gas Resources, Inc. dated January
7, 1998.

 

Gas Purchase Contract by
and between Square One Energy, Inc. and Newpoint Gas Services, Inc. dated April
21, 2004.

 

Crude Oil Purchase Agreement
by and between Ladder Energy Company and Sunoco, Inc. (R&M) dated February
1, 2000, as amended by a letter agreement between Sunoco Partners Marketing
& Terminals, L.P. and Ladder Energy Company dated September 12, 2005.

 

Crude Oil Purchase Agreement
by and between Ladder Energy and Coffeyville Resources Crude Transportation
dated October 4, 2005.

 

Natural Gas Liquid Mix
Agreement by and between Square One Energy, Inc. and Dufour Petroleum, L.P.
dated July 1, 2004, as amended by Amendment Letter dated October 1, 2005 and as
amended by Amendment Letter dated November 1, 2005.

 

Office Lease Agreement by
and between Ft. Worth Plaza Limited Partnership, a Texas limited partnership,
as Landlord and Cano Petroleum, Inc. (assignee of Cano Energy Corporation), as
Tenant, purportedly dated April 10, 2001, as amended by the First
Amendment to Lease Agreement dated September 19, 2001.

 

Consulting Agreement by
and between Cano Petroleum, Inc. and Reservoir Solutions, Inc. dated
August 15, 2005.

 

Lignin Surfactant System
Development Agreement by and between Cano Petroleum, Inc. and Reservoir
Solutions, Inc. dated July 20, 2005.

 

Stock Purchase Agreement
by and between Cano Petroleum, Inc., W. O. Energy of Nevada, Inc., Miles O’Loughlin
and Scott White dated November 29, 2005.

 

Employment Agreement by
and between Huron Ventures, Inc. and Michael J. Ricketts dated May 28,
2004.

 

Employment Agreement by
and between Huron Ventures, Inc. and Thomas Cochrane dated May 28, 2004.

 

Employment Agreement by
and between Cano Petroleum, Inc. and James K. Teringo, Jr. dated July 11,
2005.

 

Compensation
Reimbursement Agreement by and between Cano Petroleum, Inc. and Sabine
Production Operating, LLC dated October 31, 2005.

 

 

Omnibus Agreement by and
between Cano Petroleum, Inc., Carlile Management, LLC, Haddock Enterprises, LLC
and Sabine Production Partners, LP dated October 31, 2005.

 

Amended and Restated
Regulations of Sabine Production Operating, LLC executed by Cano Petroleum,
Inc., Haddock Enterprises, LLC and Carlile Management, LLC, effective as of
August 3, 2005.

 

2005 Directors’ Stock
Option Plan of Cano Petroleum, Inc.

 

Gas Purchase and Sales
Contract by and between Arrow Oil and Gas, Inc. and STP, Inc. dated
August 15, 2002.

 

Management Stock Pool
Agreement dated May 28, 2004 among Huron Ventures Inc. and The
Shareholders of Davenport Field Unit Inc.

 

Management Stock Pool
Escrow Agreement dated May 28, 2004 by and among Huron Ventures Inc. and
S. Jeffrey Johnson, et al.

 

Purchase and Sale
Agreement dated August 16, 2004, by and between Cano Energy Corporation and
Cano Petroleum, Inc.

 

Purchase and Sale
Agreement dated September 2, 2004, by and between Nowata Oil Properties LLC and
Cano Petroleum, Inc.

 

Purchase and Sale
Agreement dated February 6, 2005, by and between Square One Energy, Inc. and
Cano Petroleum, Inc.

 

Subscription Agreement
dated October 8, 2004 by and between Cano Petroleum, Inc. and Randall Boyd.

 

Stock Option Agreement
dated December 16, 2004, between Cano Petroleum, Inc. and Gerald W. Haddock.

 

Form of Subscription
Agreement dated March 18, 2005.

 

Letter Agreement dated
March 29, 2005 among the Haddock Enterprises, LLC, Cano Petroleum, Inc. and
Kenneth Carlile.

 

Sabine Production
Partners, LP Transaction Summary dated August 4, 2005.

 

Subscription Agreement
dated September 16, 2005 by and between Cano Petroleum, Inc. and Howard Hughes
Medical Institute.

 

Subscription Agreement
dated September 16, 2005 by and between Cano Petroleum, Inc. and The Robert
Wood Johnson Foundation.

 

Subscription Agreement
dated September 16, 2005 by and between Cano Petroleum, Inc. and Laborers’
District Council and Contractors’ of Ohio Pension Fund.

 

Subscription Agreement
dated September 16, 2005 by and between Cano Petroleum, Inc. and Ohio
Carpenters’ Pension Fund.

 

Subscription Agreement
dated September 16, 2005 by and between Cano Petroleum, Inc. and New York
Nurses Association Pension Plan.

 

Subscription Agreement
dated September 16, 2005 by and between Cano Petroleum, Inc. and Public Sector
Pension Investment Board.

 

 

Subscription Agreement
dated September 16, 2005 by and between Cano Petroleum, Inc. and Spindrift
Investors (Bermuda) L.P.

 

Subscription Agreement
dated September 16, 2005 by and between Cano Petroleum, Inc. and Spindrift
Partners, L.P.

 

Non-Qualified Stock
Option Agreement dated September 16, 2005 by and between Cano Petroleum, Inc.
and James K. Teringo, Jr.

 

Subscription Agreement
dated September 14, 2005 by and between Cano Petroleum, Inc. and Touradji
Global Resources Master Fund, Ltd.

 

Subscription Agreement
dated September 14, 2005 by and between Cano Petroleum, Inc. and Renaissance US
Growth Investment Trust PLC.

 

Subscription Agreement
dated September 14, 2005 by and between Cano Petroleum, Inc. and BFS US Special
Opportunities Trust PLC.

 

Subscription Agreement
dated September 14, 2005 by and between Cano Petroleum, Inc. and Crestview
Capital Master, LLC.

 

Gas Purchase Contract
between W.O. Operating Company, Ltd. and Duke Field Services LP dated November
1, 2003.

 

Gas Purchase and Sales
Agreement dated September 1, 1975, between Skelly Oil Company, as Seller, and
Phillips Petroleum Company, as Buyer.

 

Gas Purchase Contract
between W.O. Operating Company, as Seller, and GPM Gas Corporation, as Buyer,
dated March 15, 1994.

 

Gas Purchase Contract
between Hugoton Energy Corporation, as Seller, and GPM Gas Corporation, as
Buyer, dated August 3, 1995, covering Sections 3 and 4, Block Y, M&C
Survey, Hutchinson County, Texas.

 

Crude Oil Purchase
Contract between W.O. Operating Company, as Seller, and Diamond Shamrock
Refining Company LP, dated August 6, 2001 (Valero is successor to Diamond
Shamrock on this contract).

 

Gas Purchase Contract by
and between W.O. Operating Company Limited, as Seller, and OneOK Texas Field
Services LP, as Buyer, dated January 1, 2005.

 

Gas Purchase Contract
between W.O. Operating Company, as Seller, and GPM Gas Corporation, as Buyer,
dated March 15, 1995. 

 

Gas Purchase Contract
dated August 3, 1995 by and between W.O. Operating Company and Duke Energy
Field Services, as amended on August 1, 2005 and September 1, 2005.

 

Oil Marketing Agreement
dated January 13, 1994 by and between W.O. Operating Company and Pan Mark, Inc.

 

Registration
Rights Agreement by and between Cano Petroleum, Inc. and Miles O’Loughlin dated
November 29, 2005.

 

Registration
Rights Agreement by and between Cano Petroleum, Inc. and Scott White dated
November 29, 2005.

 

Credit
Agreement among Cano Petroleum, Inc., as Borrower, The Lenders Party Hereto
from Time to Time, as Lenders, and Union Bank of California, N.A., as
Administrative Agent and as Issuing Lender, dated November 29, 2005.

 

 

Subordinated
Credit Agreement among Cano Petroleum, Inc., as Borrower, The Lenders Party
Hereto From Time to Time, as Lenders, and Energy Components SPC EEP Energy
Exploration and Production Segregated Portfolio, as Administrative Agent, dated
November 29, 2005.

 

Guaranty
Agreement by and among Ladder Companies Inc., Square One Energy, Inc., W.O.
Energy of Nevada, Inc., WO Energy, Inc., W.O. Operating Company, Ltd. and W.O.
Production Company, Ltd. in favor of Union Bank of California, N.A., as
Administrative Agent, dated November 29, 2005.

 

Guaranty
Agreement by and among Ladder Companies Inc., Square One Energy, Inc., W.O.
Energy of Nevada, Inc., WO Energy, Inc., W.O. Operating Company, Ltd. and W.O.
Production Company, Ltd. in favor of Energy Components SPC EEP Energy
Exploration and Production Segregated Portfolio, as Administrative Agent, dated
November 29, 2005.

 

Escrow
Agreement by and among Cano Petroleum, Inc., Miles O’Loughlin, Scott White and
The Bank of New York Trust Company, N.A., as Escrow Agent, dated November 29,
2005.

 

Pledge
Agreement by and among Cano Petroleum, Inc., W.O. Energy of Nevada, Inc. and WO
Energy, Inc. in favor of Union Bank of California, N.A., as Administrative
Agent, dated November 29, 2005.

 

Security
Agreement by and among Cano Petroleum, Inc., Ladder Companies Inc., Square One
Energy, Inc., W.O. Energy of Nevada, Inc., WO Energy, Inc., W.O. Operating
Company, Ltd. and W.O. Production Company, Ltd. in favor of Union Bank of
California, N.A., as Administrative Agent, dated November 29, 2005.

 

Cano
Petroleum, Inc. 2005 Long-Term Incentive Plan.

 

Form
of Stock Option Agreement.

 

Summary
of terms of purchase of overriding royalty interests by Cano Petroleum, Inc.
from THEprivate Energy Company, Inc. dated December 27, 2005.

 

Summary
Sheet:  Director Compensation.

 

Employment
Agreement between Cano Petroleum, Inc. and S. Jeffrey Johnson effective
January 1, 2006.

 

Amendment
to Employment Agreement of Michael J. Ricketts effective January 1, 2006.

 

Amendment
to Employment Agreement of Thomas Cochrane effective January 1, 2006.

 

Amendment
to Employment Agreement of James K. Teringo, Jr. effective January 1,
2006.

 

Amendment
No. 1 dated February 24, 2006, to the $100,00,000 Credit Agreement among Cano
Petroleum, Inc., as Borrower, The Lenders Party Hereto From Time to Time as
Lenders and Union Bank of California, N.A., as Administrative Agent and as
Issuing Lender dated November 29, 2005.

 

Gas Purchase Agreement
dated 5-2-90 Between Maple Gas Corporation (Buyer) and Myriad Resources
Corporation (Seller).

 

Gas Purchase and Sales
Agreement dated 2-1-74 between Phillips Petroleum Company (Buyer) and Sohio
Petroleum Company (Seller).

 

Gas Purchase Contract
dated 11-1-87 between George A. Smith (Seller) and Westar Transmission
Company [now Oneok Field Services] (Buyer).

 

Gas Purchase Contract
dated January 14, 1998, between Myriad Resources Corporation (Seller) and
GPM Gas Corporation (Buyer).

 

 

Gas Services and/or
Purchase Agreement dated 7-20-99, by and between Myriad Resources Corporation
(Owner) and Dynegy Midstream Services).

 

Gas Purchase Contract
dated May 10, 1990, by and between Myriad Resources, as Seller, and
Phillips 66 Natural Gas Company, as Buyer, covering Section 94,
Block B-2, H&GN RR Company Survey, Gray County, Texas.

 

Gas Purchase Contract
dated 10-31-95, between GPM Gas Corporation (Buyer) and Pamtex, Inc., et al
(Seller).

 

Gas Purchase Contract
dated 11-20-92 (Contract No. PAM0548-00R), between Rio Petroleum, Inc.
(Seller) and GPM Gas Corporation (Buyer); as amended by instruments dated
6-1-99, 11-2-98 and 12-16-97.

 

Gas Purchase Agreement
dated March 1, 2003, by and between Oneok Texas Field Services, LP
(Buyer), and Myriad Resources Corporation (Seller) covering the E/2NW/4 and
W/2NE/4, Section 67, Block 4, I&GN Survey, Carson County, Texas.

 

Gas Purchase Contract
dated June 23, 1994, by and between Myriad Resources Corporation, as
Seller, and GPM Gas Corporation, as Buyer, covering the NE/4 Section 33,
Block B-2, H&GN Survey, Gray County, Texas.

 

Casinghead Gas Contract
dated February 23, 1949, by and between Danciger Oil & Refining
Company and Phillips Petroleum Company, as amended and extended.

 

Gas Purchase Contract
dated 8-13-96, between GPM Gas Corporation (Buyer) and Myriad Resources
Corporation (Seller).  Covers Section 3,
J.T. Sneed Survey.

 

Agreement dated
June 25, 1928, by and between Roxana Petroleum Corporation and Danciger
Oil & Refining Company of Texas covering the E 80 acres of SW/4,
Section 5, Block 1, ACH&B Survey, Gray County, Texas.

 

Gas Purchase Contract
dated 8-13-96, between GPM Gas Corporation (Buyer) and Myriad Resources
Corporation (Seller).  Covers
Section 3, J.T. Sneed Survey.

 

Gas Purchase Contract
dated 10-1-04, between Oneok Texas Field Services, L.P. (Buyer) and Pamtex,
Inc. (Seller).  /4 and the E/2 NW/4,
Section 127, Block 3, I&GN RR Co. Survey.

 

Agreement dated
June 25, 1928, by and between Roxana Petroleum Corporation and Danciger
Oil & Refining Company of Texas covering the E 80 acres of SW/4, Section 5,
Block 1, ACH&B Survey, Gray County, Texas.

 

Gas Purchase Contract
dated May 10, 1990, by and between Myriad Resources, as Seller, and
Phillips 66 Natural Gas Company, as Buyer, covering Section 94,
Block B-2, H&GN RR Company Survey, Gray County, Texas.

 

Casinghead Gas Contract
dated February 23, 1949, by and between Danciger Oil & Refining
Company and Phillips Petroleum Company, as amended and extended.

 

Asset Purchase and Sale
Agreement among Myriad Resources Corporation, Westland Energy Company, and
PAMTEX, a Texas general partnership composed of PAMTEX GP1 Ltd. and PAMTEX GP2
Ltd. as sellers, and the Borrower as the purchaser and dated April 25, 2006, as
assigned from the Borrower to Pantwist, LLC

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00104-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00104-of-00352.parquet"}]]