ex10_12.htm


    
      

    

    
      Exhibit
10.12

       

      BERRY
PETROLEUM COMPANY

      


      NON-EMPLOYEE
DIRECTOR

      


      DEFERRED
STOCK AND COMPENSATION PLAN

      


      


      (as
amended and restated effective November 19, 2008)

      


      


      Section
1.       Establishment of Plan;
Purpose.  The
Berry Petroleum Company Non-Employee Director Deferred Stock and Compensation
Plan (the “Plan”) is hereby established to permit Eligible Directors, in
recognition of their contributions to the Company (a) to receive Shares in lieu
of Compensation and (b) to defer recognition of their Compensation in the manner
described below.  The Plan is intended to enable the Company to
attract, retain and motivate qualified directors and to enhance the long-term
mutuality of interest between Directors and stockholders of the
Company.

      


      Section
2.       Definitions.  When
used in this Plan, the following terms shall have the definitions set forth in
this Section:

      


      2.1.          “Accounts”
shall mean an Eligible Director’s Stock Unit Account and Interest
Account.

      


      2.2.          “Board
of Directors” shall mean the Board of Directors of the Company.

      


      2.3.          “Committee”
shall mean the Compensation Committee of the Board of Directors or such other
committee of the Board as the Board shall designate from time to
time.

      


      2.4.          “Company”
shall mean Berry Petroleum Company, a Delaware corporation.

      


      2.5.          “Compensation”
shall mean (a) the quarterly fee earned by an Eligible Director for service as a
Director; (b) the fee, if any, earned by an Eligible Director for service as a
member of a committee of the Board of Directors; (c) the fee earned by an
Eligible Director for (i) attendance at meetings of the Board of Directors and
(ii) attendance at meetings of committees; and (d) any other cash compensation
earned for service as a Director.

      


      2.6.          “Determination
Date” shall mean, for the Compensation earned by an Eligible Director (x) for
the services identified in subsections (a), (b) and (c) of the definition of
“Compensation” above, the last trading day of the fiscal quarter in which such
service was provided, and (y) pursuant to subsection (d) of the definition of
Compensation above, the date designated by the Board of Directors for the
payment of such Compensation, or if such date is not a trading day, the first
trading day thereafter.

      


      2.7.          “Director”
shall mean any member of the Board of Directors, whether or not such member is
an Eligible Director.


      
        
           


        

        
          1

          
            

          

        

        
           


        

      


      2.8.          “Effective
Date” shall mean the date on which the Plan is approved by the stockholders of
the Company.

      


      2.9.          “Eligible
Director” shall mean a member of the Board of Directors who is not an employee
of the Company.

      


      2.10.        “Exchange
Act” shall mean the Securities Exchange Act of 1934, as amended.

      


      2.11.        “Fair
Market Value” shall mean the closing price or the last sale (as reported by the
New York Stock Exchange) of a Share or any other reasonable basis using actual
transactions of such Shares as reported and as shall be consistently applied by
the Committee.

      


      2.12.        “Interest
Account” shall mean the bookkeeping account established to record the interests
of an Eligible Director with respect to deferred Compensation that is not
allocated to Units in a Stock Unit Account.

      


      2.13.        “Shares”
shall mean shares of Stock.

      


      2.14.        “Stock”
shall mean the Class A Common Stock of the Company.

      


      2.15.        “Stock
Unit Account” shall mean a bookkeeping account established to record the
interests of an Eligible Director who has elected to have deferred Compensation
credited as Units in this Account.

      


      2.16.        “Unit”
shall mean a contractual obligation of the Company to deliver a Share to an
Eligible Director or the beneficiary or estate of such Eligible Director as
provided herein.

      


      Section
3.       Administration.  The
Plan shall be administered by the Committee.

      


      Section
4.       Deferred Compensation
Program.

      


      4.1.          Election
to Defer.  On
or before December 31 of any calendar year, an Eligible Director may elect to
defer receipt of all or any part of any Compensation payable in respect of the
calendar year following the year in which such election is made, and to have
such amounts credited, in whole or in part, to a Stock Unit Account or an
Interest Account.  Any person who shall become an Eligible Director
during any calendar year may elect, not later than the 30th day after his term
as a Director begins, to defer payment of all or any part of his Compensation
payable for the portion of such calendar year following such
election.

      


      4.2.          Method
of Election.  A
deferral election shall be made by written notice filed with the Corporate
Secretary of the Company.  Such election shall continue in effect
(including with respect to Compensation payable for subsequent calendar years)
unless and until the Eligible Director revokes or modifies such election by
written notice filed with the Corporate Secretary.  Any such
revocation or modification of a deferral election shall become effective as of
December 31 of the year in which such notice is given and only with respect to
Compensation payable in respect of the calendar year following the year in which
such revocation or modification is made.  Amounts credited to the
Eligible Director’s Stock Unit Account prior to the effective date of any such
revocation or modification of a deferral election shall not be affected by such
revocation or modification and shall be credited and distributed only in
accordance with the deferral election in place prior to such revocation and
modification and otherwise in accordance with the applicable terms of the
Plan.  An Eligible Director who has revoked an election to participate
in the Plan may file a new election to defer Compensation with respect to
services rendered in the calendar year following the year in which such new
election is filed with the Corporate Secretary of the Company.


      
        
           


        

        
          2

          
            

          

        

        
           


        

      


      4.3.          Investment
Election.  At
the time an Eligible Director elects to defer receipt of Compensation pursuant
to Section 4.1, the Eligible Director shall also designate in writing the
portion of such Compensation, stated as a whole percentage, to be credited to
the Interest Account and the portion to be credited to the Stock Unit
Account.  If an Eligible Director fails to designate the allocation
between the two Accounts, 100% of such Compensation shall be credited to the
Interest Account.  By written notice to the Corporate Secretary, an
Eligible Director may change the investment election and the manner in which
Compensation is allocated among the Accounts but only with respect to services
to be rendered in the calendar year following the year in which such new
investment election is filed with the Corporate Secretary.

      


      4.4.          Interest
Account.

      


      a.           Any
Compensation allocated to an Eligible Director’s Interest Account shall be
deemed earned and credited to the Interest Account as of the Determination
Date.

      


      b.           Any
amounts credited to the Interest Account shall be credited with interest at the
annual rate for the 3-month treasury bill as of the Determination Date as quoted
in the Wall Street Journal, times 3/12.

      


      4.5.           Stock
Unit Account.

      


      a.           Any
Compensation allocated to an Eligible Director’s Stock Unit Account shall be
deemed earned and credited to Units in the Stock Unit Account as of the
Determination Date.

      


      b.           The
number of Units allocated to the Eligible Director’s Stock Unit Account pursuant
to subsection (a) above shall be equal to the quotient of (i) the aggregate
Compensation allocated to the Stock Unit Account as of the Determination Date
divided by (ii) the Fair Market Value on the Determination
Date.  Fractional Units shall be credited, but shall be rounded to the
nearest hundredth percentile, with amounts equal to or greater than .005 rounded
up and amounts less than .005 rounded down.

      


      4.6.         Dividend
Equivalents.                                           

      


      a.           An
Eligible Director who has elected to defer Compensation to a Stock Unit Account
shall have no rights as a stockholder of the Company with respect to any Units
until Shares are distributed and delivered to the Eligible
Director.

      


      b.           Notwithstanding
the provisions of subsection (a), each Eligible Director who has allocated
Compensation to a Stock Unit Account shall have the right to receive an amount
equal to the dividend per Share declared by the Company on the applicable
dividend payment date (which, in the case of any dividend distributable in
property other than Shares, shall be the per Share value of such dividend, as
determined by the Company for purposes of income tax reporting) times the number
of Units held by such Eligible Director in his Stock Unit Account (a “Dividend
Equivalent”).


      
        
           


        

        
          3

          
            

          

        

        
           


        

      


      c.           Dividend
Equivalents shall be treated as reinvested in an additional number of Units and
credited to the Eligible Director’s Stock Unit Account.

      


      d.           The
additional number of Units to be credited to the Eligible Director’s Stock Unit
Account pursuant to (c) (iii) shall be determined by dividing (i) the product of
(A) the number of Units in the Eligible Director’s Stock Unit Account on the
date the dividend is declared, and (B) the amount of any cash dividend declared
by the Company on a Share (or, in the case of any dividend distributable in
property other than Shares, the per share value of such dividend, as determined
by the Company for purposes of income tax reporting), by (ii) the Fair Market
Value on the last trading day of the fiscal quarter in which the dividend is
declared.

      


      e.           Notwithstanding
the date used for purposes of determining the number of additional Units as
provided in subsection (d) above, the additional Units to be credited for
Dividend Equivalents shall be deemed earned and credited to the Eligible
Director’s Stock Unit Account on the last trading day of the fiscal quarter in
which such dividend is declared.

      


      f.           In
the event of any stock split, stock dividend, recapitalization, reorganization
or other corporate transaction affecting the capital structure of the Company,
the Committee shall make such adjustments to the number of Units credited to
each Eligible Director’s Stock Unit Account as the Committee shall deem
necessary or appropriate to prevent the dilution or enlargement of such Eligible
Director’s rights and such adjustment shall be made and effective as of the last
day of the fiscal quarter in which such corporate transaction has
occurred.

      


      4.7.         Distribution
Election.

      


      a.           At
the time an Eligible Director makes a deferral election pursuant to Section 4.1,
the Eligible Director shall also file with the Corporate Secretary a written
election (a “Distribution Election”).

      


      b.           The
distribution from the Stock Unit Account shall be made in Shares and the
distribution from the Interest Account shall be made in cash.  The
Distribution Election shall specify that such distribution shall commence, at
the election of the Eligible Director, as soon as practicable following the
first business day of the calendar month following the date the Eligible
Director ceases to be a Director or on the first business day following the
calendar year in which the Eligible Director ceases to be a
Director.

      


      c.           Such
distribution shall be in one lump sum payment or in such number of annual
installments (not to exceed ten (10)) as the Eligible Director may designate on
the Distribution Election.  The amount of any installment payment
shall be determined by multiplying the amount credited to the Accounts of an
Eligible Director immediately prior to the distribution by a fraction, the
numerator of which is one and the denominator of which is the number of
installments (including the current installment) remaining to be
paid.


      
        
           


        

        
          4

          
            

          

        

        
           


        

      


      d.           An
Eligible Director may at any time prior to the time at which the Eligible
Director ceases to be a Director, and from time to time, change any Distribution
Election applicable to his Accounts, provided that no election to change the
timing or form of any final distribution shall be effective unless (i) it is
made in writing and received by the Corporate Secretary at least one (1) year
prior to the time at which the Eligible Director ceases to be a director and
(ii) the start date of any installment distribution or lump sum payment is
delayed at least five years.

      


      4.8.         Unforeseeable
Emergency Withdrawal.  Any
Eligible Director may, after submission of a written request to the Corporate
Secretary and such written evidence of the Eligible Director’s financial
condition as the Committee may reasonably request, withdraw from his Interest
Account (but not from his Stock Unit Account) up to such amount as the Committee
shall determine to be necessary to alleviate the Eligible Director’s
unforeseeable emergency plus applicable taxes as a result of the
distribution.  Withdrawals will only be approved for a severe
financial hardship to the Eligible Director resulting from an illness or
accident of the Eligible Director, his or her spouse or dependent (as defined in
IRC § 409A (a) (2) (B) (ii)).

      


      4.9.          Timing
and Form of Distributions.

      


      a.           Any
distribution to be made hereunder, whether in the form of a lump sum payment or
installments, following the termination of an Eligible Director’s service as a
Director shall commence in accordance with the Distribution Election made by the
Eligible Director pursuant to Section 4.7.

      


      b.           If
an Eligible Director fails to specify in accordance with Section 4.7 a
commencement date for a distribution or whether such distribution shall be made
in a lump sum payment or a number of installments, such distribution shall be
made in a lump sum payment and commence on the first business day of the month
immediately following the date on which the Eligible Director ceases to be a
Director.  In the case of any distribution being made in annual
installments, each installment after the first installment shall be paid on the
first business day of each subsequent calendar year, or as soon as practical
thereafter, until the entire amount subject to such Distribution Election shall
have been paid.

      


      Section
5.      Unfunded Status.  The
Company shall be under no obligation to establish a fund or reserve in order to
pay the benefits under the Plan.  A Unit represents a contractual
obligation of the Company to deliver Shares to an Eligible Director as provided
herein.  The Company has not segregated or earmarked any Shares or any
of the Company’s assets for the benefit of an Eligible Director or his
beneficiary or estate, and the Plan does not, and shall not be construed to,
require the Company to do so.  The Eligible Director and his
beneficiary or estate shall have only an unsecured, contractual right against
the Company with respect to any Units granted or amounts credited to an Eligible
Director’s Accounts hereunder, and such right shall not be deemed superior to
the right of any other creditor.  Units shall not be deemed to
constitute options or rights to purchase Stock.


      
        
           


        

        
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      Section
6.      Amendment and Termination.  The
Plan may be amended at any time by the Committee or the Board of
Directors.  Unless the Board otherwise specifies at the time of such
termination, the termination of the Plan will not result in the premature
distribution of the amounts credited to an Eligible Director’s
Accounts.

      


      Section
7.      General Provisions.

      


      7.1.          No
Right to Serve as a Director.  This
Plan shall not impose any obligations on the Company to retain any Eligible
Director as a Director nor shall it impose any obligation on the part of any
Eligible Director to remain as a Director of the Company.

      


      7.2.           Rights
of a Terminated Director.  Notwithstanding
the fact that an Eligible Director ceases to be a director during any fiscal
quarter, the Eligible Director’s Accounts shall be credited, on the last trading
day of the fiscal quarter, with all Compensation and Dividend Equivalents earned
as of the last business day he served as an Eligible Director.

      


      7.3.           Construction
of the Plan.  The
validity, construction, interpretation, administration and effect of the Plan
and the rights relating to the Plan, shall be determined solely in accordance
with the laws of the State of Delaware.

      


      7.4.           No
Right to Particular Assets.  Nothing
contained in this Plan and no action taken pursuant to this Plan shall create or
be construed to create a trust of any kind or any fiduciary relationship between
the Company and any Eligible Director, the executor, administrator or other
personal representative or designated beneficiary of such Eligible Director, or
any other persons.  Any reserves that may be established by the
Company in connection with Units granted under this Plan shall continue to be
treated as the assets of the Company for federal income tax purposes and remain
subject to the claims of the Company’s creditors.  To the extent that
any Eligible Director or the executor, administrator, or other personal
representative of such Eligible Director, acquires a right to receive any
payment from the Company pursuant to this Plan, such right shall be no greater
than the right of an unsecured general creditor of the Company.

      


      7.5.           Severability
of Provisions.  If
any provision of this Plan shall be held invalid or unenforceable, such
invalidity or unenforceability shall not affect any other provisions hereof, and
this Plan shall be construed and enforced as if such provision had not been
included.

      


      7.6.           Incapacity.  Any
benefit payable to or for the benefit of a minor, an incompetent person or other
person incapable of receipting therefore shall be deemed paid when paid to such
person’s guardian or to the party providing or reasonably appearing to provide
for the care of such person, and such payment shall fully discharge any
liability or obligation of the Board of Directors, the Company and all other
parties with respect thereto.

      


      7.7.           Headings
and Captions.  The
headings and captions herein are provided for reference and convenience only,
shall not be considered part of this Plan, and shall not be employed in the
construction of this Plan.

       

       

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