RESIGNATION AND MUTUAL RELEASE AGREEMENT

4.                                        Restricted Stock .  By signing this Agreement, the Company represents and warrants that the Individual has no awards of restricted stock from the Company.

5.                                        Removal of Restrictive Legends From Stock Certificates .  The Company acknowledges and agrees that the Individual acquired and fully paid for 100,000 shares of the Company’s common stock on December 16, 1998 and October 21, 2002 and that the stock certificates representing such stock contain restrictive legends.  Promptly after receipt from the Individual of a signed copy of the letter attached as Exhibit C to this Agreement, the Company shall promptly cause such restrictive legends to be removed from the stock certificates.

6.                                        Mutual Releases .

a.                                        By the Individual .  In consideration of the Company’s promises and undertakings in this Agreement, the Individual and his family members, heirs, successors, and assigns (collectively, the “ Individual Releasing Parties ”) hereby release, acquit, and forever waive and discharge any and all claims and demands of whatever kind or character, whether known, unknown, vicarious, derivative, or direct, that he or they, individually, collectively, or otherwise, may have or assert against (i) the Company; (ii) any parent, subsidiary, or affiliate of the Company; (iii) any past or present officer, director, or employee of the entities just named in (i)-(ii), in their individual and official capacities; and (iv) any predecessors, successors, parent companies, subsidiaries, owners, stockholders, members, managers, operating units, affiliates, divisions, agents, representatives, officers, directors, partners, members, employees, fiduciaries, insurers, attorneys, successors, and assigns of the entities just named in (i)-(iii) (collectively the “ Company Released Parties ”).  This release includes without limitation any claim or demand arising out of or relating in any way to (i) the Individual’s service as a member of the Board or his resignation from such position; (ii) any contract or agreement between, concerning, or relating to the parties; and (iii) any other alleged act, breach, conduct, negligence, gross negligence, omission, fraud, or alleged illegal activity or violation of law of the Company or any of the other Company Released Parties.  This release does not waive any rights or claims between the parties arising after this Agreement is signed or relating to the breach or enforcement of this Agreement, that certain Settlement Agreement by and among the Company, Nanes Balkany Partners I LP, Nigel J. Lovett, the Individual, Julien Balkany, Craig M. McKenzie and Peter Hill, effective the date hereof (the “Settlement Agreement”) or arising out of any Company sponsored employee benefit plans.

b.                                       By the Company .  In consideration of the Individual’s promises and undertakings in this Agreement, the Company, on behalf of itself and its employees, subsidiaries, affiliates, successors, and assigns (collectively, the “ Company Releasing Parties ”), hereby releases, acquits, and forever waives and discharges any and all claims and demands of whatever kind or character, whether known, unknown, vicarious, derivative, direct, or indirect that it or they, individually,

collectively, or otherwise, may have or assert against the Individual in his individual, official, and all other capacities and the Individual’s family members, heirs, successors, and assigns (collectively the “ Individual Released Parties ”).  This release includes without limitation any claim or demand arising out of or relating in any way to (i) the Individual’s service as a director, officer, employee, fiduciary, agent, or in any other capacity for the Company or its subsidiaries or affiliates; (ii) any contract or agreement between, concerning, or relating to the Individual and the Company or any of its subsidiaries or affiliates; and (iii) any other alleged act, breach, conduct, negligence, gross negligence, omission, fraud, or alleged illegal activity or violation of law of the Individual or any of the other Individual Released Parties.  This release does not waive any rights or claims between the parties arising after this Agreement is signed or relating to the breach or enforcement of this Agreement or the Settlement Agreement.

7.                                        Continuing Certificate of Incorporation and Bylaw Indemnification .  To the fullest extent permitted by applicable law, the Individual shall be entitled to indemnification following the Resignation Date on the same terms as indemnification is provided by the Company to other officers and directors through the Company’s certificate of incorporation and/or bylaws.

8.                                        Directors’ and Officers’ Indemnification and Insurance .

(a)                                   Continuing Obligations .  The provisions of the certificate of incorporation and bylaws of the Company with respect to exculpation, indemnification, and advancement of expenses as of the Resignation Date shall not be amended, repealed, or otherwise modified for a period of six years from Resignation Date in any manner that would materially adversely affect the Individual’s rights thereunder with respect to his service as a director, officer, employee, fiduciary, or agent of the Company or any of its affiliates or subsidiaries in respect of actions or omissions occurring on or before the Resignation Date (including, without limitation, the matters contemplated by this Agreement), unless such modification is required by law.

(b)                                  Separate Indemnity Agreement .  The Company shall on the Resignation Date enter into an Indemnity Agreement with the Individual in the form attached as Exhibit B.

(c)                                   Maintenance of Current Directors’ and Officers’ Liability Insurance .  As long as it is a public company, the Company shall, for six years after the Resignation Date, use commercially reasonable best efforts to maintain in effect the current directors’ and officers’ liability insurance policies maintained by the Company (provided that the Company may substitute therefor policies of at least the same coverage and amounts containing terms and conditions which are no less advantageous to the Individual so long as substitution does not result in gaps or lapses in coverage) with respect to matters occurring on or before the Resignation Date; provided, however , that in no event shall the Company be required to

expend pursuant to this Paragraph 8(c) more than an amount per year equal to 300% of annual premiums paid on the Resignation Date by the Company for such insurance and, in the event the cost of such coverage shall exceed that amount, the Company shall purchase as much coverage as possible for such amount.  In addition, the Company represents that, as of the Resignation Date, the Individual is insured by the current directors’ and officers’ liability insurance policies maintained by the Company and agrees that, as long as it is a public company, it shall use commercially reasonable best efforts to cause the Individual to continue to be insured under such policies for six years after the Resignation Date.

(d)                                  Required Assumption of Obligations .  In the event the Company or any of its respective successors or assigns (i) consolidates with or merges into any other person and shall not be the continuing or surviving corporation or entity of such consolidation or merger or (ii) transfers all or substantially all of its properties and assets to any person, then, and in each such case where such assumption does not occur by operation of law, proper provision shall be made so that the successors and assigns of the Company, as the case may be, shall assume the obligations in this Paragraph 8 and under the Indemnity Agreement referred to in Paragraph 8(b).

(e)                                   Other Indemnification Rights .  The rights of the Individual under this Paragraph 8 shall supplement, rather than supplant, any other rights the Individual may have under the certificate of incorporation, charter, or bylaws of the Company, under Delaware law or otherwise.

9.                                        Consultation .  In consideration of the Company’s promises and undertakings in this Agreement, the Individual shall, without additional compensation, upon request of the Company’s Board or its designee, be available from the Resignation Date through June 30, 2009, for consultation at reasonable times and without unreasonable interference with his personal or business activities, in person or by telephone, as necessary, on such matters relating to the Company within his personal knowledge.  The Company shall promptly reimburse the Individual for all reasonable costs incurred in providing consultation in accordance with this paragraph.  The Individual shall provide the Company with appropriate documentation of such costs.  Any such costs shall be reimbursed as soon as administratively practicable after receiving documentation of same, but in any event no later than the last day of the calendar year following the calendar year in which the cost is incurred.  Further, the amount of costs eligible for reimbursement during a calendar year shall not affect the costs eligible for reimbursement in any other calendar year.

10.                                  Nonadmission of Liability or Wrongdoing .  This Agreement shall not in any manner constitute an admission of liability or wrongdoing on the part of Individual or any of the other Individual Released Parties.  The Individual and the other Individual Released Parties expressly deny any such liability or wrongdoing.  Except as necessary to enforce this Agreement, neither this Agreement nor any part of it may be construed, used, or

admitted into evidence in any judicial, administrative, or arbitral proceedings as an admission of any kind by Individual or any of the other Individual Released Parties.

11.                                  Authority to Execute .  The Company represents and warrants that it has the authority to execute this Agreement on behalf of all the Company Releasing Parties.  The Individual represents and warrants that he has the authority to execute this Agreement on behalf of all the Individual Releasing Parties.

12.                                  Governing Law; Severability; Interpretation .  Except as otherwise expressly provided above, this Agreement and the rights and duties of the parties under it shall be governed by the laws of the State of Texas, without regard to any conflicts of laws principles.  If any provision of this Agreement is held to be unenforceable, such provision shall be considered separate, distinct, and severable from the other remaining provisions of this Agreement, and shall not affect the validity or enforceability of such other remaining provisions; and in all other respects, this Agreement shall remain in full force and effect.  If any provision of this Agreement is held to be unenforceable as written but may be made to be enforceable by limitation, then such provision shall be enforceable to the maximum extent permitted by applicable law.  The language of all parts of this Agreement shall in all cases be construed as a whole, according to its fair meaning, and not strictly for or against any of the parties.

13.                                  Assignment and Assumption .  This Agreement shall be binding upon and inure to the benefit of the parties and their respective heirs, legal representatives, successors, and permitted assigns.  If such assumption does not occur by operation of law, the Company shall require any successor to or assign (whether direct or indirect, by purchase, merger, consolidation, or otherwise) of all or substantially all of the business and/or assets of the Company, by agreement in form and substance reasonably satisfactory to the Individual, to expressly and unconditionally assume and agree to perform this Agreement.

14.                                  Entire Agreement .  This Agreement and the Indemnity Agreement contain and represent the entire agreements of the parties with respect to the Individual’s resignation and payments and benefits upon or by reason of his resignation, and supersede all prior agreements and understandings, written and oral, between the parties with respect to the Individual’s resignation and payments or benefits upon or by reason of his resignation.

15.                                  Modification .  No provision of this Agreement may be amended, modified, or waived unless such amendment, modification, or waiver is agreed to in writing and signed by the Individual and by a duly authorized officer of the Company.

16.                                  Paragraph Headings .  The paragraph headings in this Agreement are for convenience of reference only, form no part of this Agreement, and shall not affect its interpretation.

17.                                  Counterparts .  This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which together shall be considered one and the same agreement.

18.                                  Consultation With an Attorney .  The Individual has been represented by counsel during his resignation and the negotiation and execution of this Agreement.  The Individual acknowledges that the Company has advised him to consult with his attorney before signing this Agreement.  To assist the Individual in this endeavor, the Company shall promptly reimburse him for reasonable, documented attorney’s fees he incurs in consulting his attorney concerning his resignation and this Agreement; provided, that, such attorney’s fees are incurred no later than the last day of the second taxable year following the taxable year in which the Resignation Date occurs, and provided further, that, such reimbursements are made no later than the third taxable year following the taxable year in which the Resignation Date occurs.

[remainder of page intentionally left blank; signatures on following page]

AGREED on the dates shown below:

EXHIBIT A

SUMMARY OF STOCK OPTIONS

A-1

EXHIBIT B

FORM OF INDEMNITY AGREEMENT

INDEMNITY AGREEMENT

This Agreement made and entered into as of this 22nd day of January, 2009, by and between Toreador Resources Corporation, a Delaware corporation (the “Company”), and John Mark McLaughlin (“Indemnitee”), who is currently serving the Company in the capacity of a director and/or officer thereof;

W I T N E S S E T H:

WHEREAS, several stockholders of the Company have separately sought the resignation and replacement certain existing directors of the Company, including the Chairman and the Chief Executive Officer;

WHEREAS, the Chairman and CEO have agreed to this request in exchange for the Company’s entering into certain agreements, including separate Indemnity Agreements in this form, with each;

WHEREAS, Section 145 of the General Corporation Law of the State of Delaware and the Restated Certificate of Incorporation of the Company, which set forth certain provisions relating to the mandatory and permissive indemnification of, and advancement of expenses to, officers and directors (among others) of a Delaware corporation by such corporation, are specifically not exclusive of other rights to which those indemnified thereunder may be entitled under any bylaw, agreement, vote of stockholders or disinterested directors or otherwise; and

WHEREAS, after due consideration and investigation of the terms and provisions of this Agreement and the various other options available to the Company and the Indemnitee in lieu thereof, the Board of Directors of the Company has determined that the following Agreement is not only reasonable and prudent but necessary to promote and ensure the best interests of the Company and its stockholders;

NOW, THEREFORE, in consideration of the premises and the mutual agreements herein set forth and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the Company and Indemnitee, intending to be legally bound, do hereby agree as follows:

1 .       Definitions.    As used in this Agreement:

(a)            “Enterprise” shall mean any other corporation, limited liability company, partnership, joint venture, trust, employee benefit plan, organization or other enterprise of which Indemnitee is or was serving at the request of the Company as a director, officer, trustee, general partner, managing member, fiduciary, employee or agent.

(b)            The term “Expenses” includes, without limitation, all reasonable attorneys’ fees, retainers, court costs, transcript costs, fees of experts, witness fees, travel expenses, duplicating costs, printing and binding costs, telephone charges, postage, delivery service fees and all other disbursements or expenses of the types customarily incurred in

B-1

connection with prosecuting, defending, preparing to prosecute or defend, investigating, or being or preparing to be a witness in, or otherwise involved in, a Proceeding.  Should any payments by the Company under this Agreement be determined to be subject to any federal, state or local income or excise tax, Expenses will also include such amounts as are necessary to place Indemnitee in the same after-tax position, after giving effect to all applicable taxes, Indemnitee would have been in had such tax not have been determined to apply to those payments.  Expenses also shall include (i) Expenses incurred in connection with any appeal resulting from any Proceeding, including, without limitation, the premium, security for, and other costs relating to any cost bond, supersedeas bond, or other appeal bond or its equivalent and (ii) Expenses incurred by Indemnitee in connection with the interpretation, enforcement or defense of Indemnitee’s rights under this Agreement, by litigation or otherwise.

(c)            “Independent Counsel” means a law firm, or a member of a law firm, that is experienced in matters of corporation law and neither presently is, nor in the past five years has been, retained to represent:  (i) the Company or Indemnitee in any matter material to either such party (other than with respect to matters concerning the Indemnitee under this Agreement, or of other indemnitees under similar indemnification agreements), or (ii) any other party to the Proceeding giving rise to a claim for indemnification hereunder.  Notwithstanding the foregoing, the term “Independent Counsel” shall not include any person who, under the applicable standards of professional conduct then prevailing, would have a conflict of interest in representing either the Company or Indemnitee in an action to determine Indemnitee’s rights under this Agreement.  The Company agrees to pay the reasonable fees and expenses of the Independent Counsel referred to above and to fully indemnify such counsel against any and all Expenses, claims, liabilities and damages arising out of or relating to this Agreement or its engagement pursuant hereto.

(d)            &#822