SUMMARY OF 2009 CASH INCENTIVEAWARDS
EXHIBIT 10.1
SUMMARY OF 2009 CASH INCENTIVE AWARDS
The 2009 Cash Incentive Awards are based on the following threshold, target and maximum performance goals for fiscal year 2009 and the weighting set forth next to the goals (Cano Petroleum, Inc. (“Cano”) notes that these goals are part of Cano’s incentive program and do not correspond to any financial or performance guidance that Cano has provided or will provide and should not be considered as statements of Cano’s expectations or estimates):
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| Performance Goals |
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| Performance Measure |
| Threshold |
| Target |
| Maximum |
| Weighting |
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| Company Goals |
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| Production* |
| 1,212 BOEPD |
| 1,346 BOEPD |
| 1,616 BOEPD |
| 55 | % |
| Proved Developed Producing Reserves |
| 11,400 MBOE |
| 12,667 MBOE |
| 15,200 MBOE |
| 15 | % |
| EBITDA |
| $13,155,000 |
| $14,617,000 |
| $17,540,000 |
| 15 | % |
| Finding & Development Costs |
| $24.87 per BOE |
| $22.38 per BOE |
| $18.65 per BOE |
| 15 | % |
*Average daily production for fiscal year 2009.
Cano calculates EBITDA as earnings before interest, taxes, depreciation and amortization.
The 2009 Cash Incentive Awards potential payout levels based on meeting the specified level of each of the performance goals for the 2009 Cash Incentive Awards performance goals for each executive officer are set forth below:
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| 2009 Bonus Payout |
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| Base Salary |
| Target Bonus |
| Threshold |
| Target |
| Maximum |
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| S. Jeffrey Johnson |
| $ | 509,480 |
| 75 | % | $ | 191,055 |
| $ | 382,110 |
| $ | 573,165 |
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| Benjamin Daitch |
| $ | 250,000 |
| 75 | % | $ | 93,750 |
| $ | 187,500 |
| $ | 281,250 |
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| Patrick McKinney |
| $ | 250,000 |
| 75 | % | $ | 93,750 |
| $ | 187,500 |
| $ | 281,250 |
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| Michael J. Ricketts |
| $ | 187,000 |
| 50 | % | $ | 46,750 |
| $ | 93,500 |
| $ | 140,250 |
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| Phillip Feiner |
| $ | 170,000 |
| 50 | % | $ | 42,500 |
| $ | 85,000 |
| $ | 127,500 |
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