Exhibit 10.3


 


VENOCO,
INC.


AMENDED
AND RESTATED 2005 STOCK INCENTIVE PLAN


 


Amendment No. 2


 


THIS AMENDMENT No. 2
to the Venoco, Inc. (the “Company”) Amended and Restated 2005 Stock
Incentive Plan (the “Plan”) is dated November 17, 2008 to amend the Plan
in the following respects.


 


WHEREAS,
the Compensation Committee (the “Committee”) of the Company’s Board of
Directors has the authority to amend the Plan pursuant to Sections 3 and 12 of
the Plan;


 


WHEREAS,
the Committee desires to amend the Plan to comply with the requirements of
section 409A of the Internal Revenue Code of 1986, as amended, so as to avoid
additional taxes and interest under that section for participants in the Plan;


 


WHEREAS,
the Committee desires to make certain other amendments deemed necessary or
advisable to maintain compliance with applicable laws, rules and
regulations.


 


NOW
THEREFORE, the Committee hereby amends the Plan in the
following respects:


 


1.                                      Conformance
to Section 409A of the Code. 
Effective as of the date written above, Section 3(e) is
deleted in its entirety and replaced with the following:


 


“Conformance to Section 409A of the Code.
If, at any time, tax advisors to the Company determine that the terms of any
outstanding Stock Award result in additional tax or interest to the holder
under Section 409A of the Code, the Board or the Committee shall have the
authority to enter into an amendment of such Stock Award, consistent with this
Plan, that is designed to avoid such additional tax or interest. If any Stock
Award constitutes deferred compensation within the meaning of Section 409A
of the Code, any acceleration of the payment of such Stock Award upon a Change
of Control as provided under this Plan shall occur only if the Change of
Control constitutes, in the good-faith determination of the Board or the
Committee, a change in the ownership or effective control of the Company, or in
the ownership of a substantial portion of the assets of the Company, under Section 409A
of the Code. If any other payment under this Plan constitutes deferred
compensation within the meaning of Section 409A of the Code and if the
Plan fails to satisfy the requirements of Section 409A(a)(2), (3) or (4) of
the Code with respect to such payment, such provision shall be operated in a
manner that, in the good-faith determination of the Board or the Committee,
seeks to bring the provision into compliance with those requirements while
preserving as closely as possible the original intent of the provision.”


 


2.                                      Restricted
Stock Dividends.  Effective as of the
date written above, the following sentence shall be added to the end of Section 7(b):


 

















 


“A stock appreciation
right shall not be substituted for a previously granted Stock Award unless
counsel advises that the stock appreciation right will not likely provide for
the deferral of compensation under Section 409A of the Code.”


 


3.                                      Restricted
Stock Dividends.  Effective as of the
date written above, Section 10(e)(ii) is deleted in its entirety and
replaced with the following:


 


“Restricted Stock. Unless
otherwise provided in and upon the terms and conditions in the Stock Award
Agreement governing an award of restricted stock, a Participant shall have the
right to receive all dividends and other distributions paid or made respecting
such restricted stock.  All dividends
declared with respect to a Participant’s Restricted Stock shall be paid to such
Participant not later than March 15 following the calendar year in which
the dividends are declared.”


 


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2

















 


IN WITNESS WHEREOF, the
Company, by its duly authorized officer, has executed this Amendment No. 2
to the 2005 Amended and Restated Stock Incentive Plan as of the date first
indicated above.


 


	
   

  	
  VENOCO, INC.

  
	
   

  	
  A Delaware corporation

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  /s/ Timothy M. Marquez

  
	
   

  	
  By:

  	
  Timothy M. Marquez

  
	
   

  	
  Its:

  	
  Chief Executive Officer

  



 


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