THIS CRUDE OIL SUPPLY AGREEMENT entered into on February 27, 2007 for performance commencing as of July 1, 2007 (the “ Effective Date ”), is made by and between Berry Petroleum Company, a Delaware corporation (“ Supplier ”), and Holly Refining & Marketing Company - Woods Cross, a Delaware corporation (“ Refiner ”). Supplier and Refiner may each be referred to hereinafter individually as a “ Party ” or collectively as the “ Parties .”

A.   WHEREAS Refiner is investing significant capital in order to process increased volumes of black wax crude oil at its Woods Cross refinery (the “ Refinery ”) located at Salt Lake City, in the State of Utah and is therefore interested in securing a long term supply of black wax crude oil blend for the Refinery; and

B.   WHEREAS Supplier and Refiner have considered the mutual benefit of a long term black wax crude oil supply agreement containing price terms and volume commitments, all as set forth in this Agreement;

NOW THEREFORE , in consideration of the foregoing, the representations, warranties, covenants, agreements and undertakings contained in this Agreement and other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as follows:

1.1   Definitions . Capitalized terms used in this Agreement and the Schedules hereto, unless otherwise defined herein, have the meanings given to those terms in Schedule 1.1 .

1.2   Attachments . The following Schedules are attached to this Agreement and are incorporated into this Agreement by this reference:

Schedule 1.1    Definitions

Schedule 2.1    Quality Ranges of Crude Oil

Schedule 2.3    Delivery Point

Schedule 3.2    Quality Testing Procedures

Schedule 3.3    Measurement Procedures

Schedule 7.8    Continuing Guaranty

Schedule 11.1(a)        Continuing Guaranty (For Extension Period)

1.3   Independent Contractor; No Partnership . Each Party’s duties and performance under this Agreement shall be those of an independent contractor, as defined by Applicable Laws. The Parties expressly agree and acknowledge that (a) nothing in this Agreement shall be deemed to make the Parties partners or joint venturers, and (b) neither Party shall have any right, power or authority to enter into any agreement or undertaking for, or act on behalf of, or to act as or be an agent or representative of, or to otherwise bind, the other Party except as expressly provided herein.

2.1   Supply and Receipt of Base Daily Volumes. 

(a)   During the Term and subject to Section 2.1(b) , Supplier shall sell and deliver to Refiner at the Delivery Point, and Refiner shall buy and take delivery at the Delivery Point 3,200 Barrels of Crude Oil per Day (the “ Base Daily Volume ”).

(b)   If Refiner has delivered to Supplier a certificate certifying that the Refinery Modification Completion has occurred, as soon thereafter as reasonably possible for Supplier to accomodate but in any event within ninety (90) Days from the date of such delivery of the certificate (or such later date as may be specified in the certificate) the Base Daily Volume shall be increased to 5,000 Barrels of Crude Oil per Day.

(c)   A 50% Daily variation in the quantity of Crude Oil delivered pursuant to this Section 2.1 shall be permitted; provided that for each Month or portion thereof during the Term, the average Daily quantity delivered pursuant to this Section 2.1 shall equal the Base Daily Volume.

2.2   Supply and Receipt of Incremental Daily Volumes.

(a)   Not later than 120 Days prior to the start of any Contract Year, Supplier may provide a notice to Refiner indicating the Daily volume of Crude Oil production in addition to the Base Daily Volumes that Supplier and its Affiliates reasonably anticipate producing during such Contract Year. Within 30 Days following receipt of such notice by Refiner, Refiner shall notify Supplier of the portion, if any, of such additional Daily volume of Crude Oil that Refiner desires to purchase. Failure to deliver such notice shall be deemed an election by Refiner not to purchase any of such additional Daily volume. Such portion, if any, that Refiner elects to purchase in its notice to Supplier shall be referred to herein as the “ Incremental Daily Volume ”. For the Contract Year immediately following such notice from Refiner, but not for the remainder of the Term following such Contract Year, Supplier shall sell and deliver to Refiner at the Delivery Point, and Refiner shall buy and take delivery at the Delivery Point each Day the Incremental Daily Volume, in addition to the Base Daily Volume.

(b)   A 50% Daily variation in the quantity of Crude Oil delivered pursuant to this Section 2.2 shall be permitted; provided that for each Month or portion thereof during the Term, the average Daily quantity delivered pursuant to this Section 2.2 shall equal the Incremental Daily Volume.

2.3   Delivery Point . Supplier will tender delivery of all Crude Oil to be delivered to Refiner pursuant to this Agreement at the outlet flanges of Supplier’s lease tankage on wells identified on Supplier’s Uinta Basin, Utah, properties from time to time in writing by Supplier to Refiner as referenced on Schedule 2.3 (the “ Delivery Point ”). Refiner shall accept delivery of such Crude Oil at the Delivery Point.

2.4   Scheduling. 

(a)   The Parties shall coordinate to schedule the delivery and receipt of Crude Oil in accordance with the procedures and limitations of the relevant transport and delivery and receiving facilities; provided that this Section 2.4(a) shall not limit the obligations of the Parties pursuant to Sections 2.1 and 2.2 .

(b)   Notice of Significant Events . 180 Days in advance of any planned material events which impact the Refinery’s ability to process or Supplier’s ability to produce the Crude Oil to be delivered hereunder, such as a refinery turnaround or a production facility turnaround (a “ Significant Event ”) the affected Party shall notify the other Party regarding schedule and volume impacts of any Significant Event that may, in the case of Refiner, reduce its processing capabilities, or in the case of Supplier, reduce its supplying capabilities, by more than 10% of the Contract Daily Volume for more than seven Days. The Parties shall use commercially reasonable efforts to reduce the adverse impacts of all Significant Events on each Party. If the required notice has been provided, the Parties obligations under Sections 2.1 and 2.2 shall be excused during any such Significant Events. Each Party agrees to keep the other Party promptly advised of all developments in the status of any Significant Event. No Significant Event shall be scheduled during the Term which has the effect of reducing the Base Annual Volume in any one 12 month period by more than 10%.

2.5   Dedication of Production . Supplier will dedicate its (and its Affiliates’) first production of Crude Oil to satisfy the requirements of this Agreement. Without limiting the foregoing, Supplier agrees that any agreements by Supplier or its Affiliates to sell Crude Oil to a purchaser other than Refiner shall be satisfied only out of production in excess of the volumes to be sold to Refiner pursuant to this Agreement. In the event Supplier elects to market its production in excess of the Base Daily Volumes and Refiner chooses to bid for such volumes, Supplier will contract to sell the incremental volumes to Refiner if Refiner exceeds or matches the highest bid from other potential purchasers.

3.1   Quality

(a)   The crude oil delivered to Refiner shall conform to the Minimum Quality Specifications (“ Crude Oil ”). Without limiting any other provision of this Agreement, in no event shall Supplier inject any unsaturated stock or vis-broken stock, LPG, Natural Gasoline or Lube Oils as a part of Crude Oil delivered under this Agreement. If Refiner deems the quality of Crude Oil delivered pursuant to this Agreement to be inconsistent with Prudent Industry Practices, Supplier and Refiner shall work together to develop additional delivered quality management processes and specifications. If Supplier and Refiner are unable to develop such additional processes and specifications, the matter shall be resolved by arbitration in accordance with Section 13.7.

(b)   Supplier warrants that the Crude Oil delivered to the Refiner conforms to the minimum specifications set forth in Schedule 2.1 (the “ Minimum Quality Specifications ”) and is not contaminated by any foreign chemicals.

3.2   Evidence of Quality . For purposes of determining whether the crude oil delivered pursuant to this Agreement meets the Minimum Quality Specifications, Refiner will have 30 Days from the date that a delivery arrives at the Refinery to notify Supplier that it has tested the delivery and that the test results indicate that the delivery did not meet the Minimum Quality Specifications. Supplier will have 30 Days from receipt of such notification to provide the results of sample analysis performed by a reputable independent third party testing service using the testing methods described in Schedule 3.2 . Any rejection of volumes or price adjustment will be based on such injection sample test results.

3.3   Measurement . Measurement of Crude Oil shall be in accordance with the measurement procedures set forth on Schedule 3.3 .

3.4   Observation . Each Party shall have the right to have a representative witness all gauges, tests, or measurements performed in connection with this Agreement providing that reasonable advance notice is given. In the absence of the other party’s representative, such gauges, tests, and measurements shall be deemed to be correct absent manifest error.

4.1   Pricing Formula. The price (the “ Price Formula ”) for Crude Oil delivered pursuant to this Agreement shall be set as follows:

(a)   The price for Base Daily Volumes (US$/Barrel) shall equal *** multiplied by WTI, Cushing (US$/Barrel).

(b)   The price for Incremental Daily Volumes (US$/Barrel) shall equal *** multiplied by WTI, Cushing (US$/Barrel).

4.2   Non-Conforming Batch. If Supplier supplies a delivery which does not meet the Minimum Quality Specifications, Refiner shall be entitled either to reject such volumes (in which case Supplier shall be responsible for the costs associated with the redelivery to Supplier of such volumes) or to accept such volumes. In either case, the Parties agree to execute a price adjustment for volumes delivered in the non-conforming delivery, including a full refund of the purchase price and associated costs (e.g., transportation costs) incurred by Refiner for volumes that are rejected.

4.3   Change of Conventional Light Sweet Benchmark. The Parties agree that WTI, Cushing is intended to measure the fair market value of conventional light sweet crude oil on a North American based futures exchange. If at any time in the future WTI, Cushing ceases to be representative of the North American conventional light sweet crude oil markets, the Parties agree to determine a new light sweet crude oil benchmark for use in the Price Formula. In the event of such a cessation, either Party may declare an initiation date for the process of adjusting the Price Formula by giving notice to the other Party. The new benchmark shall be based on a

North American futures contract, if such contract exists. The Price Formula will be adjusted for quality, transportation and location for the new benchmark using the process outlined below:

(a)   Compare Historical Period Average Prices for the current benchmark versus the proposed new benchmark to determine a linear correlation (y=mx) between the fair market values of the current benchmark versus the proposed new benchmark and apply this correlation to the Price Formula.

(b)   After transition to the new light crude benchmark and establishing the revised Price Formula, either Party may request a review of the Price Formula after the elapse of 6 Months. Any changes to the Price Formula resulting from the review shall be effective immediately after the review is complete and agreed by both Parties. The review results shall not have any retroactive effect and only one review period shall be permitted during the Term.

5.1   Term. This term of this Agreement (“ Term ”) commences at midnight, Applicable Time, on the Effective Date, and expires at midnight, Applicable Time, on the date of termination provided in Section 11.1 .

6.1   Title Warranty. Supplier warrants that (a) all crude oil delivered pursuant to this Agreement will be free from encumbrances and other adverse interests and (b) Supplier has the right to sell and pass title to Refiner of all such crude oil.

6.2   Disclaimer . EXCEPT AS SPECIFICALLY PROVIDED IN SECTIONS 3.1(b) , 6.l AND ARTICLE 8 , SUPPLIER MAKES NO, AND HEREBY DISCLAIMS ANY, REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, STATUTORY OR OTHERWISE, ABOUT OR RELATING TO THE CRUDE OIL DELIVERED BY IT HEREUNDER INCLUDING, WITHOUT LIMITATION, WARRANTIES AS TO CONDITION, QUALITY, MERCHANTABILITY, FITNESS FOR A PARTICULAR PURPOSE, OR OTHERWISE.

6.3   Transfer of Title and Associated Risks Warranty. Title, custody and risk of loss to Crude Oil delivered hereunder shall pass from Supplier to Refiner when Supplier delivers Crude Oil to Refiner at the Delivery Point, it being understood and agreed that any casualty, loss, escape or contamination occurring before and to the Delivery Point shall be the responsibility of Supplier and after the Delivery Point shall be the responsibility of Refiner. Except as otherwise provided in this Agreement, Refiner shall be responsible for arranging and paying for all transportation from the Delivery Point to the Refinery.

7.1   Payment Per Warranty. Refiner agrees to pay Supplier the Purchase Price for each Barrel of Crude Oil Supplier delivers to the Delivery Point pursuant to this Agreement.

7.2   Monthly Invoices Warranty . Supplier shall invoice Refiner for Crude Oil delivered pursuant to this Agreement, on a Monthly basis. Such invoice shall include the following information: the Month of delivery under the transaction; the volume(s) of delivery; the Purchase Price; and the due date of payment pursuant to Section 7.4 .

7.3   Necessary Documents Warranty. Upon request, each Party agrees to furnish the other Party all source documents for each volume of crude oil delivered pursuant to this Agreement that are reasonably available to the furnishing Party; provided that furnishing source documents shall not be a precondition for payment unless expressly so agreed by the Parties. Source documents include delivery tickets, transfer settlements, or other shipping/loading documents provided by a pipeline or other carrier indicating the type, quality, volume, and other characteristics of the crude oil delivered.

7.4   Payment of Invoices Warranty . Refiner shall pay all amounts owed by it hereunder by electronic funds transfer to Supplier’s account designated in Section 13.3(c) with immediately available funds by the later of the 5th Business Day after the applicable invoice was received or the 20th Day of the Month following the Month of crude oil delivery. If payment falls due on a Saturday or a bank holiday of the bank where the designated account is located other than Monday, payment shall be due on the preceding banking day of such bank. If payment falls due on a Sunday or a Monday bank holiday of such bank, payment shall be due on the next banking day of such bank. Payment shall be deemed made on the date good funds are credited to Supplier's account at such bank.

7.5   Late Payments. Any payments that are not made when due under this Agreement pursuant to Section 7.4 shall bear interest at a per annum rate which shall be two percentage points above the U.S. prime rate as published in the Wall Street Journal (or such other publication as the parties may agree from time to time) in effect on the date payment was due from the date such payment is due until such payment is made paid in full.

7.6   Corrections; Disputes. Invoices and payments shall be subject to correction for billing errors for a period of 24 Months after the end of the Month prior to which the invoice was issued. No adjustment or correction shall be made and all records and payments shall be conclusively presumed to be final and shall not be subject to examination, unless notice specifying the error or inaccuracy is given within such 24-Month period. If Refiner disputes the correctness of any invoice, Refiner shall nevertheless pay the full amount of the invoice (including the disputed portion) and shall notify Supplier of the specific basis for disputing the correctness of the invoice as soon as practical after becoming aware of the basis for the dispute, and Refiner shall be entitled to a refund for overpayments plus interest at the rate described in Section 7.5 calculated from the date of payment until refunded.

7.7   Financial Responsibility. Notwithstanding anything in this Agreement, if at any time, Parent has a net worth of less than $200,000,000 or should Supplier reasonably believe that such Parent’s net worth is less than $200,000,000, Supplier may at anytime require, by written notice to Refiner, at Refiner’s choice, either 1) advance cash payment, or 2) satisfactory security in the form of a letter or letters of credit at Refiner’s expense in a form and from a bank reasonably acceptable to Supplier, to cover any and all deliveries of Crude Oil.  If, on or before the date specified in Supplier’s notice under this Section 7.7, Refiner does not prepay or provide the letter or letters of cre