ex_10-1.htm


    
      

      

    

    Exhibit
10.1

     

     

    

      


       

      SECOND
AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT

       

      THIS
SECOND AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT (this “Amendment”) made as
of February 19, 2009 by and among BERRY PETROLEUM COMPANY, a Delaware
corporation (“Borrower”), WELLS
FARGO BANK, NATIONAL ASSOCIATION, individually and as administrative agent
(“Administrative
Agent”), and the Lenders party to the Original Credit Agreement defined
below (“Lenders”).

       

      W I T N E
S S E T H:

       

      WHEREAS,
Borrower, Administrative Agent and Lenders entered into that certain Amended and
Restated Credit Agreement dated as of July 15, 2008 (as amended, supplemented,
or restated to the date hereof, the “Original Credit
Agreement”), for the purpose and consideration therein expressed, whereby
Lenders became obligated to make loans to Borrower as therein provided;
and

       

      WHEREAS,
Borrower, Administrative Agent and Lenders desire to amend the Original Credit
Agreement as set forth herein;

       

      NOW,
THEREFORE, in consideration of the premises and the mutual covenants and
agreements contained herein and in the Original Credit Agreement, in
consideration of the loans which may hereafter be made by Lenders to Borrower,
and for other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto do hereby agree as
follows:

       

      ARTICLE
I.

       

      


       

      DEFINITIONS AND
REFERENCES

       

      §
1.1.                      Terms Defined in the
Original Credit Agreement.  Unless the context otherwise
requires or unless otherwise expressly defined herein, the terms defined in the
Original Credit Agreement shall have the same meanings whenever used in this
Amendment.

       

      §
1.2.                      Other Defined
Terms.  Unless the context otherwise requires, the following
terms when used in this Amendment shall have the meanings assigned to them in
this Section 1.2.

       

      “Amendment” means this
Second Amendment to Amended and Restated Credit Agreement.

       

      “Credit Agreement”
means the Original Credit Agreement as amended hereby.

       

      “Original Omnibus
Certificate” means the Omnibus Certificate dated July 15, 2008 executed
and delivered by officers of Borrower pursuant to the Original Credit
Agreement.

       


      
        
          
            [Second
Amendment to Credit Agreement]

          

           


        

        
          1

          
            

          

        

        
           


          BERRY
PETROLEUM COMPANY - EXHIBIT 10.1

        

      


      


       

      


       

      Amendments
to Original Credit Agreement

       

      §
1.3.                      Definitions.

       

      (1)           The following definitions in Section
1.1 of the Original Credit Agreement are hereby amended in their entirety to
read as follows:

       

      “'Base Rate Margin'
means, on any day, the following percentages per annum based on the Utilization
Percentage as set forth below:

      


      
        	 
      	
                 

                Utilization
      Percentage

                 

              	 	
                
                

                Base
      Rate Margin

                
                

              	 
	
                Level
      1

              	
                < 50%

              	 	 	2.250	%
	
                Level
      2

              	
                ≥
      50% but < 75%

              	 	 	2.500	%
	
                Level
      3

              	
                ≥
      75% but < 90%

              	 	 	2.750	%
	
                Level
      4

              	
                ≥
      90%

              	 	 	3.000	%


      

      


      “'Commitment Fee Rate'
means, on any day, the following percentages per annum based on the Utilization
Percentage set forth below; provided that the outstanding Swing Line Loans shall
be excluded for purposes of calculating the Commitment Fee Rate:

       

      
        	 
      	
                 

                Utilization
      Percentage

                 

              	 	
                
                

                Commitment
      Fee

              	 
	
                Level
      1

              	
                < 50%

              	 	 	0.50	%
	
                Level
      2

              	
                ≥
      50% but < 75%

              	 	 	0.50	%
	
                Level
      3

              	
                ≥
      75% but < 90%

              	 	 	0.50	%
	
                Level
      4

              	
                ≥
      90%

              	 	 	0.50	%


      

      


      “'Core Acquisitions and
Investments' means (i) acquisitions of Mineral Interests and acquisitions
of assets used in the producing, drilling, transportation, processing, refining
or marketing of petroleum products that are related to a Restricted Person’s
producing Mineral Interests, and (ii) acquisitions of or Investments in Persons
engaged primarily in the business of acquiring, developing and producing Mineral
Interests or transporting, processing, refining or marketing petroleum products
that are related to a Restricted Person’s producing Mineral Interests; provided
that with respect to any acquisition or Investment described in this clause
(ii), either (A) immediately after making such acquisition or Investment,
Borrower shall directly or indirectly own at least fifty-one percent (51%) of
the Equity Interests of  such Person, measured by voting power, or (B)
such Person shall not be a publicly traded entity and such acquisition or
Investment shall be related to the business and operations of Borrower or one of
its Subsidiaries.”

       


      
        
          
            [Second
Amendment to Credit Agreement]

          

           


        

        
          2

          
            

          

        

        
           


          BERRY
PETROLEUM COMPANY - EXHIBIT 10.1

        

      


      “'Eurodollar Margin'
means, on any day, the following percentages per annum based on the Utilization
Percentage as set forth below:

       

      
        	 
      	
                 

                Utilization
      Percent age

                 

              	 	
                
                

                Eurodollar
      Margin

              	 
	
                Level
      1

              	
                <
      50%

              	 	 	2.250	%
	
                Level
      2

              	
                ≥
      50% but < 75%

              	 	 	2.500	%
	
                Level
      3

              	
                ≥
      75% but < 90%

              	 	 	2.750	%
	
                Level
      4

              	
                ≥
      90%

              	 	 	3.000	%


      

      


       

      “'Total Funded Debt'
means all Liabilities of the Restricted Persons of the types described in
clauses (a), (b), (c),(f), (h) and (j) of the definition of
Indebtedness.”

       

      (2)           The
definition of “Permitted Liens” in Section 1.1 of the Original Credit Agreement
is hereby amended by deleting the period at the end thereof, substituting a
semicolon therefor, and adding the following subsection (o) to read as
follows:

       

      “(o)           Liens
securing Permitted Second Lien Debt, which are second, junior and subordinate to
the Liens securing the Secured Obligations on terms acceptable to Administrative
Agent, as set forth in an intercreditor agreement among the holders of Permitted
Second Lien Debt or an agent acting on behalf of such holders, Administrative
Agent and Borrower, in form and substance acceptable to Administrative
Agent.”

       

      (3)           The
following definitions are hereby added to Section 1.1 of the Original Credit
Agreement in alphabetical order to read as follows:

       

      “'Control' means the
possession, directly or indirectly, of the power to direct or cause the
direction of the management or policies of a Person, whether through the ability
to exercise voting power, by contract or otherwise.  “Controlling” and
“Controlled”
have meanings correlative thereto.”

       

      “'Debtor Relief Laws'
means the Bankruptcy Code of the United States, and all other liquidation,
conservatorship, bankruptcy, assignment for the benefit of creditors,
moratorium, rearrangement, receivership, insolvency, reorganization, or similar
debtor relief Laws of the United States or other applicable jurisdictions from
time to time in effect and affecting the rights of creditors
generally.”

       

      “'Impacted Lender'
means (a) any Lender (i) which has defaulted in its obligation to fund Loans
hereunder within three Business Days of the date required to be funded by it
hereunder, (ii) which has failed to fund any portion of its participations in LC
Obligations or participations in Swing Line Loans required to be funded by it
hereunder within three Business Days of the date required to be funded by it
hereunder, (iii) which has otherwise failed to pay over to the Administrative
Agent or any other Lender any other amount required to be paid by it hereunder
within three Business Days of the date when due, unless the subject of a good
faith dispute, or (iv) which has notified


      
        
          
            [Second
Amendment to Credit Agreement]

          

           


        

        
          3

          
            

          

        

        
           


          BERRY
PETROLEUM COMPANY - EXHIBIT 10.1

        

      


      Administrative
Agent, or has stated publicly, that such Lender will not comply with any of its
funding obligations under this Agreement, (v) which has failed to confirm to
Administrative Agent in writing, within three Business Days after a written
request therefor by Administrative Agent, that such Lender will comply with such
funding obligations, or (vi) which has been deemed insolvent or become the
subject of a proceeding under any Debtor Relief Law; or (b) any Lender as to
which (i) the LC Issuer has a good faith belief that the Lender has defaulted in
fulfilling its obligations under one or more other syndicated credit facilities
or (ii) an entity that Controls such Lender has been deemed insolvent or become
subject to a proceeding under any Debtor Relief Law.”

      


      “'Permitted Convertible
Debt' means Permitted Unsecured Debt which is convertible, in whole or in
part, into common Equity Interests in Borrower; provided that Permitted
Convertible Debt shall not contain any put or mandatory redemption provisions
which may be exercised prior to January 15, 2013.”

      


      “'Permitted Second Lien
Debt' means Indebtedness in respect of senior notes (whether issued under
a loan agreement or indenture) issued by Borrower from time to time (including
guarantees thereof by its Material Domestic Subsidiaries), that complies with
all of the following requirements:

      


      (a)           no
scheduled payment of principal, scheduled mandatory redemption or scheduled
sinking fund payment of such Indebtedness is due on or before January 15, 2013;
provided that such Indebtedness may be prepaid in connection with a refinancing
thereof with other Indebtedness which is permitted by this
Agreement;

       

      (b)           payments
of interest on such Indebtedness are not due more frequently than once a
month;

       

      (c)           the
financial covenants (other than a covenant comparing the relationship between
the value of Proved Reserves attributable to Oil and Gas Properties of
Restricted Persons to various types of Indebtedness of Restricted Persons) are
no more restrictive with respect to the Restricted Persons than the financial
covenants under this Agreement and all of the covenants and events of default
governing such Indebtedness (excluding the covenant described in parenthesis
immediately above) are not, taken as a whole, materially more restrictive with
respect to the Restricted Persons than the covenants and Events of Default under
this Agreement;

       

      (d)           on
each date on which such Indebtedness is issued (in this definition defined as a
“Date of Issuance”) and immediately after giving effect to such Indebtedness
Borrower is in compliance on a pro forma basis with Sections 7.11, 7.12 and 7.13
of this Agreement, calculated for the most recent Four-Quarter Period for which
the financial statements described in Sections 6.2 (a) and (b) are available to
Lenders;

       

      (e)           no
Default or Event of Default exists on the Date of Issuance or will occur as a
result of the issuance of the notes evidencing such Indebtedness;

       


      
        
          
            [Second
Amendment to Credit Agreement]

          

           


        

        
          4

          
            

          

        

        
           


          BERRY
PETROLEUM COMPANY - EXHIBIT 10.1

        

      


      (f)           such
Indebtedness is secured by Liens, which Liens are second, junior and subordinate
to the Liens securing the Secured Obligations on terms acceptable to
Administrative Agent, as set forth in an intercreditor agreement among the
holders of Permitted Second Lien Debt or an agent acting on behalf of such
holders, Administrative Agent and Borrower, in form and substance acceptable to
Administrative Agent, which shall contain, among other terms, a standstill
period with respect to the exercise of remedies against the Collateral of no
less than 180 days, applicable to the holders of the Permitted Second Lien
Debt;

       

      (g)           such
Indebtedness is not guaranteed by any Person which is not a Guarantor of all of
the Secured Obligations; and

       

      (h)           Borrower
shall have delivered to Administrative Agent a certificate in reasonable detail
reflecting compliance with the foregoing requirements.”

       

      “'Permitted Unsecured
Debt' means Indebtedness in respect of senior unsecured notes (whether
issued under a loan agreement or indenture) issued by Borrower from time to time
(including guarantees thereof by its Material Domestic Subsidiaries), that
complies with all of the following requirements:

       

      (a)           such
Indebtedness is and shall remain unsecured at all times;

       

      (b)           no
scheduled payment of principal, scheduled mandatory redemption or scheduled
sinking fund payment of such Indebtedness is due on or before July 15, 2013;
provided that such Indebtedness may be prepaid in connection with a refinancing
thereof with other Indebtedness which is permitted by this
Agreement;

       

      (c)           the
financial covenants are no more restrictive with respect to the Restricted
Persons than the financial covenants under this Agreement and all of the
covenants and events of default governing such Indebtedness are not, taken as a
whole, materially more restrictive with respect to the Restricted Persons than
the covenants and Events of Default under this Agreement;

       

      (d)           on
each date on which such Indebtedness is issued (in this definition defined as a
“Date of Issuance”) and immediately after giving effect to such Indebtedness
Borrower is in compliance on a pro forma basis with Sections 7.11, 7.12 and 7.13
of this Agreement, calculated for the most recent Four-Quarter Period for which
the financial statements described in Sections 6.2 (a) and (b) are available to
Lender;

       

      (e)           no
Default or Event of Default exists on the Date of Issuance or will occur as a
result of the issuance of the notes evidencing such Indebtedness;

       

      (f)           such
Indebtedness is not guaranteed by any Person which is not a Guarantor of all of
the Secured Obligations; and

       

      (g)           Borrower
shall have delivered to Administrative Agent a certificate in reasonable detail
reflecting compliance with the foregoing requirements.”

       


      
        
          
            [Second
Amendment to Credit Agreement]

          

           


        

        
          5

          
            

          

        

        
           


          BERRY
PETROLEUM COMPANY - EXHIBIT 10.1

        

      


      (3)           The
definition of  “Liquidity Bridge Facility” is hereby deleted from
Section 1.1 of the Original Credit Agreement.

       

      §
1.4.                      Borrowing
Base.  Section 2.9 of the Original Credit Agreement is hereby
amended by (i) deleting subsections (b) and (c) thereof, (ii) renaming
subsections (d) and (e) thereof as subsections (e) and (f), respectively, and
(iii) adding the following new subsections (b), (c) and (d) thereto immediately
following subsection (a) thereof to read as follows:

       

      “(b)           Lenders’ Special
Redeterminations of Borrowing Base .  In addition to Scheduled
Redeterminations, Required Lenders shall be permitted to make a Special
Redetermination of the Borrowing Base once between each two consecutive
Scheduled Redeterminations, contemporaneously with each issuance of Permitted
Second Lien Debt, once after each issuance of Permitted Unsecured Debt and each
issuance of  Permitted Convertible Debt if requested by Administrative
Agent pursuant to Section 2.9(c) and when permitted by Section
7.3(g).  Any request by Required Lenders pursuant to this Section
2.9(b) shall be submitted to Administrative Agent and Borrower.  As
soon as reasonably possible, Borrower shall deliver to Administrative Agent and
Lenders an Engineering Report prepared as of a date which is no more than thirty
(30) days prior to the date of such request.

       

      (c)           Reduction of Borrowing Base
Upon Issuance of Permitted Debt.  Notwithstanding anything to
the contrary contained herein, each time Borrower issues any Permitted Unsecured
Debt or any Permitted Convertible Debt (in this section defined as “Permitted
Debt”), on the date of issuance thereof the Borrowing Base then in effect shall
be reduced automatically by an amount equal to the product of 0.25 and the
stated principal amount of the Permitted Debt so issued.  The
Borrowing Base as so reduced shall become the new Borrowing Base immediately
upon such date of issuance and shall remain in effect until the next date as of
which the Borrowing Base is redetermined pursuant to this Agreement. For
purposes of this Section 2.9(c), if any such Permitted Debt is issued at a
discount or otherwise sold for less than “par”, the reduction shall be
calculated based upon the stated principal amount without reference to such
discount. Notwithstanding the foregoing,  within thirty (30) days
after the date on which such Permitted Debt is issued, Administrative Agent may
request an additional Special Redetermination of the Borrowing Base pursuant to
Section 2.9(b) and the Borrowing Base will be redetermined in accordance with
Sections 2.9(b) and 2.9(d).

      


      (d)           Borrower’s Special
Redetermination of Borrowing Base.  In addition to Scheduled
Redeterminations, Borrower shall be permitted to request a Special
Redetermination of the Borrowing Base once between each two consecutive
Scheduled Redeterminations.  Such request shall be submitted to
Administrative Agent and Lenders and at the time of such request Borrower shall
(i) deliver to Administrative Agent and each Lender an Engineering Report
prepared as of a date which is no more than thirty (30) days prior to the date
of such request and (ii) notify Administrative Agent and each Lender of the
Borrowing Base requested by Borrower in connection with such Special
Redetermination.”

      


      §
1.5.                      Letters of
Credit.

       

      §
1.6.

       

      (1)           Section
2.11 of the Original Credit Agreement is hereby amended by deleting subparagraph
(h) thereof and adding the following new subparagraphs (h) and (i) immediately
after subsection (g) thereof to read as follows:

       

      “(h)  no Lender is at such
time an Impacted Lender hereunder, unless the LC Issuer has entered into
arrangements reasonably satisfactory to the LC Issuer, provided that the
Borrower and the LC Issuer agree that the delivery of cash collateral to LC
Issuer  shall constitute satisfactory arrangements with the Borrower
or such Lender to eliminate such LC Issuer’s risk with respect to such Lender;
and

       

      (i)           all
other conditions in this Agreement to the issuance of such Letter of Credit have
been satisfied.”

       

      (2)           Cash
Collateral.  Section 2.13 of the Original Credit Agreement is
hereby amended by adding the following new subsection (f) immediately after
subsection (e) thereof  to read as follows:

       

      
        	
                “(f)

              	
                If
      any Lender is an Impacted Lender, Borrower may from time to time provide
      cash collateral to LC Issuer, in an amount equal to the Percentage Shares
      of all Impacted Lenders’ in the LC Obligations (the “Impacted Lenders’
      Percentage”), to secure the obligations of such Impacted Lenders
      under Section 2.13 of this Agreement.  Such cash collateral
      shall be used to reimburse the Impacted Lenders’ Percentage of drawings
      under Letters of Credit and other obligations owing by Impacted Lenders to
      LC Issuer.”

              


      

       

      §
1.7.                      Replacement of
Lenders.  The portion of the first sentence of Section 3.7(b)
of the Original Credit Agreement which reads as follows:

       

      “If any
Lender requests compensation under Section 3.2, or if any Lender gives
notice to Borrower under Section 3.3 that it is unlawful for such Lender to fund
or maintain Eurodollar Loans, or if Borrower is required to pay any additional
amount to any Lender or any Governmental Authority for the account of any Lender
pursuant to Section 3.5, or if any Lender defaults in its obligation to fund
Loans hereunder, or if any Lender fails to consent to any increase in the
Borrowing Base proposed by Administrative Agent, or if any Lender has been
deemed insolvent or becomes the subject of a bankruptcy or insolvency
proceeding, or if, in connection with any consent or approval of any proposed
amendment, modification, waiver, or consent that requires consent of each
Lender, the consent of Required Lenders shall have been obtained but any Lender
has not so consented or approved (any such Lender, a “Non-Consenting
Lender”), then Borrower may, at its sole expense and effort, upon notice
to such Lender and Administrative Agent, require such Lender to assign and
delegate, without recourse (in accordance with and subject to the restrictions
contained in, and consents required by, Section 10.5), all of its interests,
rights and obligations under this Agreement and the related Loan Documents to an
assignee that shall assume such obligations (which assignee may be another
Lender, if a Lender accepts such assignment), provided that:”

      


      is
hereby amended in its entirety to read as follows:


      
        
          
            [Second
Amendment to Credit Agreement]

          

           


        

        
          6

          
            

          

        

        
           


          BERRY
PETROLEUM COMPANY - EXHIBIT 10.1

        

      


      “If any
Lender is an Impacted Lender, or if any Lender  requests compensation
under Section 3.2 or gives notice to Borrower under Section 3.3 that it is
unlawful for such Lender to fund or maintain Eurodollar Loans, or if Borrower is
required to pay any additional amount to any Lender or any Governmental
Authority for the account of any Lender pursuant to Section 3.5, or if any
Lender fails to consent to any increase in the Borrowing Base proposed by
Administrative Agent, or if, in connection with any consent or approval of any
proposed amendment, modification, waiver, or consent that requires consent of
each Lender, the consent of Required Lenders shall have been obtained but any
Lender has not so consented or approved (any such Lender, a “Non-Consenting
Lender”), then Borrower may, at its sole expense and effort, upon notice
to such Lender and Administrative Agent, require such Lender to assign and
delegate, without recourse (in accordance with and subject to the restrictions
contained in, and consents required by, Section 10.5), all of its interests,
rights and obligations under this Agreement and the related Loan Documents to an
assignee that shall assume such obligations (which assignee may be another
Lender, if a Lender accepts such assignment), provided that:”

      


      §
1.8.                      Indebtedness.  Section
7.1 of the Original Credit Agreement is hereby amended in its entirety to read
as follows:

       

                 “Section
7.1.  Indebtedness

       

      .  No
Restricted Person will in any manner owe or be liable for Indebtedness
except:

       

      
        	
                (a)

              	
                the
      Obligations;

              


      

       

      (b)           Liabilities
for taxes and governmental assessments in the ordinary course of business that
are not yet due;

       

      (c)           Indebtedness
arising under Hedging Contracts permitted under Section 7.3;

       

      (d)           Liability
for that certain royalty associated with production from Borrower’s Formax
properties;

       

      (e)           intercompany
Indebtedness arising from loans made by (i) Borrower to its wholly-owned
Subsidiaries that are Guarantors,  or (ii) any Subsidiary of Borrower
to Borrower; provided, however that upon the request of Administrative Agent at
any time, any such Indebtedness shall be evidenced by promissory notes having
terms reasonably satisfactory to Administrative Agent, and the sole originally
executed counterparts of which shall be pledged and delivered to Administrative
Agent, for the benefit of Administrative Agent and Lenders, as security for the
Obligations;

       

      (f)           SG
Obligations;

       

      (g)           Permitted
Subordinated Debt; provided that if a
Borrowing Base Deficiency exists upon the date of issuance thereof, net proceeds
from such issuance shall first be applied to the prepayment of  such
Borrowing Deficiency;

       

      (h)           Permitted
Unsecured Debt and Permitted Convertible Debt; provided that the
issuance thereof shall be subject to the provisions of Sections 2.9(b) and
2.9(c); and

       


      
        
          
            [Second
Amendment to Credit Agreement]

          

           


        

        
          7

          
            

          

        

        
           


          BERRY
PETROLEUM COMPANY - EXHIBIT 10.1

        

      


      provided further that
if a Borrowing Base Deficiency exists upon the date of issuance thereof, net
proceeds from such issuance shall first be applied to the prepayment
of  such Borrowing Deficiency;

       

      (i)           Permitted
Second Lien Debt; provided that contemporaneously with each issuance of
Permitted Second Lien Debt, Required Lenders shall have the right to redetermine
the Borrowing Base in accordance withSection 2.9(b); provided that if a
Borrowing Base Deficiency exists upon the date of issuance thereof, net proceeds
from such issuance shall first be applied to the prepayment of  such
Borrowing Deficiency; and

       

      (j)           miscellaneous
items of Indebtedness not described in subsections (a) through (i) the
outstanding amount of which does not in the aggregate (taking into account all
such Indebtedness of all Restricted Persons) exceed at any one time an amount
equal to five percent (5%) of the Net Worth of Borrower at such
time.”

       

      §
1.9.                      Hedging
Contracts.  Section 7.3 of the Original Credit Agreement is
hereby amended by adding the following subsection (g) immediately after
subsection (f) thereof to read as follows:

       

      “(g)           Except
as set forth below in this subsection, Restricted Persons shall maintain in
effect for its full term and shall not amend, modify, cancel, sell, assign,
novate or terminate (in this subsection such actions are collectively called
“Modifications”) any
Hedging Contract on which Administrative Agent and Lenders have relied in
determining the Borrowing Base.  Any Hedging Contract of a Restricted
Person may be
novated to any Lender and any Restricted Person may make other Modifications to
its Hedging Contracts; provided that, except as set forth below in this
subsection, no such novation or other Modification reduces the Borrowing Base
value of the projected production of oil, gas or natural gas liquids subject to
such Modified Hedging Contract (in this subsection called the “Value”).  Any
Restricted Person may make Modifications to any of its Hedging Contracts in a
manner which causes a reduction in the Value thereof (in this subsection, each
called a “Reduced
Value Contract”); provided that if the aggregate notional volume of oil,
gas and natural gas liquids affected by all of the Reduced Value Contracts is
greater than five percent (5%) of the aggregate notional volume of oil, gas and
natural gas liquids subject to all of the Restricted Persons’ Hedging Contracts
in effect as of the most recent Determination Date, then a Special
Redetermination of the Borrowing Base shall be made by the Administrative Agent
and Lenders in accordance with the procedures set forth in Section
2.9.  Borrower shall promptly notify Administrative Agent of
each  Modification of a Restricted Person’s Hedging
Contract.”

       

      §
1.10.                      Issuance of
Securities.  The second and third sentences of Section 7.4 of
the Original Credit Agreement are hereby amended in their entirety to read as
follows:

       

      
        	
                 
      

              	
                “Borrower
      will not issue any Equity Interests other than (a) shares of Borrower’s
      common stock and any options or warrants giving the holders thereof only
      the right to acquire such shares of common stock, and (b) shares of
      Borrower’s preferred stock, which are not treated as Indebtedness under
      GAAP, which cannot be redeemed for
cash

              


      


      
        
          
            [Second
Amendment to Credit Agreement]

          

           


        

        
          8

          
            

          

        

        
           


          BERRY
PETROLEUM COMPANY - EXHIBIT 10.1

        

      


      
        	
                 
      

              	
                (whether
      such redemption is mandatory or contingent) prior to January 15, 2013, and
      which cannot be converted into any debt instrument prior to such
      date.  No Subsidiary of Borrower will issue any additional
      shares of its capital stock or other Equity Interests or any options,
      warrants or other rights to acquire such additional shares or other Equity
      Interests except to Borrower and only to the extent not otherwise
      forbidden under the terms hereof”

              


      

      


      §
1.11.                      Financial
Covenants.

       

      (1)         Section
7.12 of the Original Credit Agreement is hereby amended in its entirety to read
as follows:

       

                 “Section
7.12  Total
Funded Debt to
EBITDAX Ratio

       

      
        	
                 
      

              	
                .   As
      of the end of each Fiscal Quarter, the ratio of (a) Total Funded Debt
      to (b) Adjusted EBITDAX for the Four-Quarter Period then ended, will
      not be greater than the amount set forth below with respect to such Fiscal
      Quarter:

              


      

       

      
        	
                Fiscal
      Quarter ended March 31, 2009

              	
                3.5
      to 1.0

              


      

       

      
        	
                Fiscal
      Quarter ended June 30, 2009

              	
                4.75
      to 1.0

              


      

      
        	
                 
      

              	
                through
      Fiscal Quarter ended

              


      

      
        	
                 
      

              	
                            December
      31, 2009

              


      

      


      
        	
                Fiscal
      Quarter ended March 31, 2010

              	
                4.5
      to 1.0

              


      

      
        	
                 
      

              	
                through
      Fiscal Quarter ended

              


      

      
        	
                 
      

              	
                                        December
      31, 2010

              


      

      


      
        	
                Fiscal
      Quarter ended March 31, 2011

              	
                4.0
      to 1.0

              


      

      
        	
                 
      

              	
                and
      each Fiscal Quarter thereafter

              


      

      


      
        	
                 
      

              	
                Borrower
      will report for the fourth quarter of 2008 a $38,500,000 bad debt expense
      (in this Section defined as the “Bad Debt Expense”) arising from its sales
      of production to Big West Oil, which has filed for bankruptcy
      protection.  For purposes of the calculation of the financial
      ratios described in Sections 7.12 and 7.13, EBITDAX shall be calculated
      treating the Bad Debt Expense as an extraordinary loss and any recovery
      with respect to the Bad Debt Expense as an extraordinary
      gain.”

              


      

      


      
        	
                (2)

              	
                The
      following Section 7.13 is hereby added to the Original Credit Agreement
      immediately after Section 7.12 to read as
  follows:

              


      

      


      “Section 7.13  Senior Secured Debt to
EBITDAX Ratio

       

      
        	
                 
      

              	
                .   As
      of the end of each Fiscal Quarter beginning June 30, 2009, the ratio of
      (a) the sum of the Obligations and the SG Obligations then
      outstanding to (b) Adjusted EBITDAX for the Four-Quarter Period then
      ended, will not be greater than the amount set forth below with respect to
      such Fiscal Quarter:

              


      

       

      
        	
                Fiscal
      Quarter ended June 30, 2009

              	
                3.75
      to 1.0

              


      


      
        	
                 
      

              	
                through
      Fiscal Quarter ended September 30,
2010

              


      

      


      
        	
                Fiscal
      Quarter ended December 31, 2010

              	
                3.5
      to 1.0

              


      

      
        	
                 
      

              	
                and
      Fiscal Quarter ended March 31, 2011

              


      

      


      
        	
                Fiscal
      Quarter ended June 30, 2011

              	
                3.25
      to 1.0

              


      

      
        	
                 
      

              	
                and
      Fiscal Quarter ended September 30,
2011

              


      

      


      
        	
                Fiscal
      Quarter ended December 31, 2011

              	
                3.0
      to 1.0

              


      

      
        	
                 
      

              	
                and
      each Fiscal Quarter thereafter”

              


      

      


      §
1.12.                      Cross Default to Other
Indebtedness.  Section 8.1(g) of the Original Credit Agreement
is hereby amended in its entirety to read as follows:

       

      “(g)           Any
Restricted Person (i) fails to pay any portion, when such portion is due, (A) of
any of its Indebtedness owing under the SG Money Market Facility, (B) of any
Permitted Subordinated Debt, Permitted Unsecured Debt, Permitted Second Lien
Debt or Permitted Convertible Debt, or (C) of any of its other Indebtedness in
excess of $25,000,000, or (ii) breaches or defaults in the performance of any
agreement or instrument by which the SG Money Market Facility, the Permitted
Subordinated Debt, the Permitted Unsecured Debt, the Permitted Second Lien Debt,
the Permitted Convertible Debt or any such other Indebtedness in excess of
$25,000,000 is issued, evidenced, governed, or secured, and any such failure,
breach or default continues beyond any applicable period of grace provided
thereof;”

       

      
        
          
            
              [Second
Amendment to Credit Agreement]

            

             


          

          
            9

            
              

            

          

          
             


            BERRY
PETROLEUM COMPANY - EXHIBIT 10.1

          

        

      

       

      
        	
                 
      

              	
                ARTICLE
      III.

              


      

      


      
        	
                 
      

              	
                CONDITIONS OF
      EFFECTIVENESS

              


      

      


      §3.1           Effective
Date.  This Amendment shall become effective as of the date
first above written when and only when:

       

      (a)           Administrative
Agent shall have received all of the following, at Administrative Agent’s
office, duly executed and delivered and in form and substance satisfactory to
Administrative Agent, all of the following:

       

      (i)           this
Amendment;

       

      (ii)           a
certificate of the Secretary of Borrower dated the date of this Amendment
certifying: (i) that resolutions attached thereto previously adopted by the
Board of Directors of the Borrower authorize the execution, delivery and
performance of this Amendment by Borrower; (ii) the names and true signatures of
the officers of the Borrower authorized to execute and deliver Loan Documents;
(iii) that the certificate of incorporation and bylaws of Borrower are in effect
on the date hereof and no modifications have been made to them; and (iv) that
all of the representations and warranties set forth in Article IV hereof are
true and correct on and as of the date hereof, except to the extent that such
representation or warranty was made as of a specific date or

       

      (iii)

       

      updated,
modified or supplemented as of a subsequent date with the consent of Required
Lenders and Administrative Agent, in which cases such representations and
warranties shall have been true and correct in all material respects on and of
such earlier date;

       

      (iv)           a
legal opinion from counsel to Borrower in form and substance acceptable to
Administrative Agent; and

       

      (v)           
such other supporting documents as Administrative Agent may reasonably
request.

       

      (b)           Borrower
shall have paid, in connection with such Loan Documents, all other fees and
reimbursements to be paid to Administrative Agent pursuant to any Loan
Documents, or otherwise due Administrative Agent and including fees and
disbursements of Administrative Agent’s attorneys.

       

      ARTICLE
IV.

       

      REPRESENTATIONS AND
WARRANTIES

       

      §4.1           Representations and
Warranties of Borrower.  In order to induce each Lender to
enter into this Amendment, Borrower represents and warrants to each Lender
that:

       

      (a)           The
representations and warranties contained in Article V of the Original Credit
Agreement are true and correct on and as of the date hereof, except to the
extent that such representation or warranty was made as of a specific date or
updated, modified or supplemented as of a subsequent date with the consent of
Required Lenders and Administrative Agent, in which cases such representations
and warranties shall have been true and correct in all material respects on and
of such earlier date.

       

      (b)           Borrower
is duly authorized to execute and deliver this Amendment and is and will
continue to be duly authorized to borrow monies and to perform its obligations
under the Credit Agreement. Borrower has duly taken all corporate action
necessary to authorize the execution and delivery of this Amendment and to
authorize the performance of the obligations of Borrower hereunder.

       

      (c)           The
execution and delivery by Borrower of this Amendment, the performance by
Borrower of its obligations hereunder and the consummation of the transactions
contemplated hereby do not and will not (a) conflict with (i) any Law, (ii) the
articles of incorporation and bylaws of Borrower, or (iii) any agreement,
judgment, license, order or permit applicable to or binding upon Borrower in any
material respect, or (b) result in the creation of any Lien upon any assets or
properties of Borrower.  Except for those which have been obtained, no
consent, approval, authorization or order of any court or governmental authority
or third party is required in connection with the execution and delivery by
Borrower of this Amendment or to consummate the transactions contemplated
hereby.

       

      (d)           When
duly executed and delivered, each of this Amendment and the Credit Agreement
will be a legal and binding obligation of Borrower, enforceable in accordance
with its

       

      (e)

       

      terms,
except as limited by bankruptcy, insolvency or similar laws of general
application relating to the enforcement of creditors’ rights and by equitable
principles of general application.

       

      (f)           The
audited annual Consolidated financial statements of Borrower dated as of
December 31, 2007 and the unaudited quarterly Consolidated financial statements
of Borrower dated as of September 30, 2008 fairly present the Consolidated
financial position at such dates and the Consolidated statement of operations
and the changes in Consolidated financial position for the periods ending on
such dates for Borrower.  Copies of such financial statements have
heretofore been delivered to each Lender.  Since such dates no
material adverse change has occurred in the financial condition or businesses or
in the Consolidated financial condition or businesses of Borrower.

      

        
          
            
              [Second
Amendment to Credit Agreement]

            

             


          

          
            10

            
              

            

          

          
             


            BERRY
PETROLEUM COMPANY - EXHIBIT 10.1

          

        



      
        ARTICLE
V.

      

       

      MISCELLANEOUS

       

      §5.1           Ratification of
Agreements.  The Original Credit Agreement as hereby amended is
hereby ratified and confirmed in all respects.  The Loan Documents, as
they may be amended or affected by this Amendment, are hereby ratified and
confirmed in all respects. Any reference to the Credit Agreement in any Loan
Document shall be deemed to be a reference to the Original Credit Agreement as
hereby amended.  The execution, delivery and effectiveness of this
Amendment shall not, except as expressly provided herein, operate as a waiver of
any right, power or remedy of Lenders under the Credit Agreement, the Notes, or
any other Loan Document nor constitute a waiver of any provision of the Credit
Agreement, the Notes or any other Loan Document.

       

      §5.2           Survival of
Agreements.  All representations, warranties, covenants and
agreements of Borrower herein shall survive the execution and delivery of this
Amendment and the performance hereof, including without limitation the making or
granting of the Loans, and shall further survive until all of the Obligations
are paid in full.  All statements and agreements contained in any
certificate or instrument delivered by Borrower hereunder or under the Credit
Agreement to any Lender shall be deemed to constitute representations and
warranties by, and/or agreements and covenants of, Borrower under this Amendment
and under the Credit Agreement.

       

      §5.3           Loan
Documents.  This Amendment is a Loan Document, and all
provisions in the Credit Agreement pertaining to Loan Documents apply
hereto.

       

      §5.4           Governing
Law.  This Amendment shall be governed by and construed in
accordance with and governed by the laws of the State of California and the laws
of the United States of America without regard to principles of conflicts of
law.

       

      §5.5           Counterparts;
Fax.  This Amendment may be separately executed in counterparts
and by the different parties hereto in separate counterparts, each of which when
so executed shall be deemed to constitute one and the same
Amendment.  This Amendment may be validly executed by facsimile or
other electronic transmission.

      



      THIS
AMENDMENT AND THE OTHER LOAN DOCUMENTS REPRESENT THE FINAL AGREEMENT BETWEEN THE
PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS, OR
SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES.  THERE ARE NO UNWRITTEN
ORAL AGREEMENTS OF THE PARTIES.

      [The remainder of this page has been
intentionally left blank.]

       


      
        
          
            [Second
Amendment to Credit Agreement]

          

           


        

        
          11

          
            

          

        

        
           


          BERRY
PETROLEUM COMPANY - EXHIBIT 10.1

        

      


      


       

      IN
WITNESS WHEREOF, this Amendment is executed as of the date first above
written.

       

      BERRY
PETROLEUM COMPANY

       

      


       

      


       

      By:           

       

      Name:

       

      Title:

       


      
        
          
            [Second
Amendment to Credit Agreement]

          

           


        

        
          12

          
            

          

        

        
           


          BERRY
PETROLEUM COMPANY - EXHIBIT 10.1

        

      


      WELLS
FARGO BANK, NATIONAL ASSOCIATION, Administrative Agent, LC Issuer and
Lender

       

      


       

      


       

      By:           

       

      Art Krasny

       

      Vice President

       


      
        
          
            [Second
Amendment to Credit Agreement]

          

           


        

        
          13

          
            

          

        

        
           


          BERRY
PETROLEUM COMPANY - EXHIBIT 10.1

        

      


      BNP
PARIBAS, Lender

       

      


       

      


       

      By:

       

      Name:

       

      Title:

       

      


       

      


       

      


       

      By:

       

      Name:

       

      Title:

       


      
        
          
            [Second
Amendment to Credit Agreement]

          

           


        

        
          14

          
            

          

        

        
           


          BERRY
PETROLEUM COMPANY - EXHIBIT 10.1

        

      


      SOCIÉTÉ
GÉNÉRALE, Lender under the Credit Agreement and the SG Money Market
Facility

       

      


       

      


       

      By:

       

      Name:

       

      Title:

       


      
        
          
            [Second
Amendment to Credit Agreement]

          

           


        

        
          15

          
            

          

        

        
           


          BERRY
PETROLEUM COMPANY - EXHIBIT 10.1

        

      


      


      JPMORGAN
CHASE BANK, N.A., Lender

       

      


       

      


       

      By:

       

      Name:

       

      Title:

       


      
        
          
            [Second
Amendment to Credit Agreement]

          

           


        

        
          16

          
            

          

        

        
           


          BERRY
PETROLEUM COMPANY - EXHIBIT 10.1

        

      


      THE ROYAL
BANK OF SCOTLAND plc, Lender

       

      


       

      


       

      By:

       

      Name:

       

      Title:

       

      THE BANK
OF NOVA SCOTIA, Lender

       

      


       

      


       

      By:

       

      Name:

       

      Title:

       

      


       

      WACHOVIA
BANK, N.A., Lender

       

      


       

      


       

      
        	
                By:

              	 


      

       

      
        	
                 
      

              	
                Name:

              


      

       

      
        	
                 
      

              	
                Title:

              


      

       


      
        
          
            [Second
Amendment to Credit Agreement]

          

           


        

        
          17

          
            

          

        

        
           


          BERRY
PETROLEUM COMPANY - EXHIBIT 10.1

        

      


      UNION
BANK, N.A. (formerly known as Union Bank of California, N.A.),
Lender

       

      


       

      


       

      By:

       

      Name:

       

      Title:

       


      
        
          
            [Second
Amendment to Credit Agreement]

          

           


        

        
          18

          
            

          

        

        
           


          BERRY
PETROLEUM COMPANY - EXHIBIT 10.1

        

      


      COMPASS
BANK, Lender

       

      


       

      


       

      By:

       

      Name:

       

      Title:

       


      
        
          
            [Second
Amendment to Credit Agreement]

          

           


        

        
          19

          
            

          

        

        
           


          BERRY
PETROLEUM COMPANY - EXHIBIT 10.1

        

      


      U.S. BANK
NATIONAL ASSOCIATION, Lender

       

      


       

      


       

      By:

       

      Name:

       

      Title:

       


      
        
          
            [Second
Amendment to Credit Agreement]

          

           


        

        
          20

          
            

          

        

        
           


          BERRY
PETROLEUM COMPANY - EXHIBIT 10.1

        

      


      CREDIT
SUISSE, CAYMAN ISLANDS BRANCH, Lender

       

      


       

      


       

      By:

       

      Name:

       

      Title:

       


      
        
          
            [Second
Amendment to Credit Agreement]

          

           


        

        
          21

          
            

          

        

        
           


          BERRY
PETROLEUM COMPANY - EXHIBIT 10.1

        

      


      BANK OF
SCOTLAND plc, Lender

       

      


       

      


       

      By:

       

      Name:

       

      Title:

       


      
        
          
            [Second
Amendment to Credit Agreement]

          

           


        

        
          22

          
            

          

        

        
           


          BERRY
PETROLEUM COMPANY - EXHIBIT 10.1

        

      


      NATIXIS,
Lender

       

      


       

      


       

      By:

       

      Name:

       

      Title:

       


      
        
          
            [Second
Amendment to Credit Agreement]

          

           


        

        
          23

          
            

          

        

        
           


          BERRY
PETROLEUM COMPANY - EXHIBIT 10.1

        

      


      BANK OF
OKLAHOMA N.A., Lender

       

      


       

      


       

      By:

       

      Name:

       

      Title:

       


      
        
          
            [Second
Amendment to Credit Agreement]

          

           


        

        
          24

          
            

          

        

        
           


          BERRY
PETROLEUM COMPANY - EXHIBIT 10.1

        

      


      RAYMOND
JAMES BANK, FSB, Lender

       

      


       

      


       

      By:

       

      Name:

       

      Title:

       


      
        
          
            [Second
Amendment to Credit Agreement]

          

           


        

        
          25

          
            

          

        

        
           


          BERRY
PETROLEUM COMPANY - EXHIBIT 10.1

        

      


      GUARANTY
BANK AND TRUST COMPANY, Lender

       

      


       

      


       

      By:

       

      Name:

       

      Title:

       


      
        
          
            [Second
Amendment to Credit Agreement]

          

           


        

        
          26

          
            

          

        

        
           


          BERRY
PETROLEUM COMPANY - EXHIBIT 10.1

        

      


      CITIBANK,
N.A., Lender

      


      


      By:

      Name:

      Title:


      
        
          
            [Second
Amendment to Credit Agreement]

          

           


        

        
          27

          
            

          

        

        
           


          BERRY
PETROLEUM COMPANY - EXHIBIT 10.1

        

      


      BANK OF
MONTREAL, Lender

      


      By:

      Name:

      Title:


      
        
          
            [Second
Amendment to Credit Agreement]

          

           


        

        
          28

          
            

          

        

        
           


          BERRY
PETROLEUM COMPANY - EXHIBIT 10.1

        

      


      CALYON
NEW YORK BRANCH, Lender

      


      By:

      Name:

      Title:


      
        
          
            [Second
Amendment to Credit Agreement]

          

           


        

        
          29