-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, OUc1Kv4916RrqD8qS63VMj2dP2fAsqL/gD5O6+FhjZsUgLSnxCH4+AJiC6g8UYR0 2fCSLV4JnpfIpbUwTa+a3A== 0001019056-08-000824.txt : 20080626 0001019056-08-000824.hdr.sgml : 20080626 20080626152842 ACCESSION NUMBER: 0001019056-08-000824 CONFORMED SUBMISSION TYPE: SC 13D/A PUBLIC DOCUMENT COUNT: 1 FILED AS OF DATE: 20080626 DATE AS OF CHANGE: 20080626 GROUP MEMBERS: DAVID J. MATLIN GROUP MEMBERS: MARK R. PATTERSON GROUP MEMBERS: MATLINPATTERSON CAPITAL MANAGEMENT GP LLC GROUP MEMBERS: MATLINPATTERSON CAPITAL MANAGEMENT L.P. GROUP MEMBERS: MATLINPATTERSON DISTRESSED OPPORTUNITIES MASTER ACCOUNT L.P. GROUP MEMBERS: MICHAEL WATZKY SUBJECT COMPANY: COMPANY DATA: COMPANY CONFORMED NAME: TOREADOR RESOURCES CORP CENTRAL INDEX KEY: 0000098720 STANDARD INDUSTRIAL CLASSIFICATION: CRUDE PETROLEUM & NATURAL GAS [1311] IRS NUMBER: 750991164 STATE OF INCORPORATION: TX FISCAL YEAR END: 1207 FILING VALUES: FORM TYPE: SC 13D/A SEC ACT: 1934 Act SEC FILE NUMBER: 005-16472 FILM NUMBER: 08919318 BUSINESS ADDRESS: STREET 1: 13760 NOEL ROAD, SUITE 1100 CITY: DALLAS STATE: TX ZIP: 75240 BUSINESS PHONE: 2145593933 MAIL ADDRESS: STREET 1: 13760 NOEL ROAD, SUITE 1100 CITY: DALLAS STATE: TX ZIP: 75240 FORMER COMPANY: FORMER CONFORMED NAME: TOREADOR ROYALTY CORP DATE OF NAME CHANGE: 19920703 FILED BY: COMPANY DATA: COMPANY CONFORMED NAME: MATLIN DAVID J CENTRAL INDEX KEY: 0001251956 FILING VALUES: FORM TYPE: SC 13D/A BUSINESS ADDRESS: STREET 1: 520 MADISON AVENUE CITY: NEW YORK STATE: NY ZIP: 10022 BUSINESS PHONE: 2126519500 SC 13D/A 1 toreador_13da2.txt SC 13D/A UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 SCHEDULE 13D Under the Securities Exchange Act of 1934 (AMENDMENT NO. 2) TOREADOR RESOURCES CORPORATION --------------------------------------------------------- (Name of Issuer) Common Stock, par value $0.15625 per share --------------------------------------------------------- (Title of Class of Securities) 891050106 --------------------------------------------------------- (CUSIP Number) MatlinPatterson Capital Management L.P. MatlinPatterson Distressed Opportunities Master Account L.P. MatlinPatterson Capital Management GP LLC David J. Matlin Mark R. Patterson Michael Watzky (Name of Persons Filing) Robert Weiss MatlinPatterson Capital Management L.P. 520 Madison Avenue, 35th Floor New York, New York 10022 Telephone: (212) 651-9525 --------------------------------------------------------- (Name, Address and Telephone Number of Person Authorized to Receive Notices and Communications) June 20, 2008 --------------------------------------------------------- (Date of Event which Requires Filing of this Statement) If the filing person has previously filed a statement on Schedule 13G to report the acquisition that is the subject of this Schedule 13D, and is filing this schedule because of Rule 13d-l(e), 13d-l(f) or 13d-l(g), check the following box [ ] Note: The information required on the remainder of this cover page shall not be deemed to be "filed" for the purpose of Section 18 of the Securities Exchange Act of 1934 ("Act") or otherwise subject to the liabilities of that section of the Act but shall be subject to all other provisions of the Act (however, see the Notes). Page 1 of 10 Schedule 13D Cusip No. 891050106 - -------------------------------------------------------------------------------- 1 NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) MatlinPatterson Capital Management L.P. - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ] (b) [ ] - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS OO - -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ] - -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - -------------------------------------------------------------------------------- SHARES BENEFICIALLY OWNED 7 SOLE VOTING POWER BY EACH REPORTING PERSON 0 WITH ---------------------------------------------- 8 SHARED VOTING POWER 2,200,599 ---------------------------------------------- 9 SOLE DISPOSITIVE POWER 0 ---------------------------------------------- 10 SHARED DISPOSITIVE POWER 2,200,599 - -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 2,200,599 - -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [ ] - -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 10.8% - -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON IA - -------------------------------------------------------------------------------- Page 2 of 10 Schedule 13D Cusip No. 891050106 - -------------------------------------------------------------------------------- 1 NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) MatlinPatterson Distressed Opportunities Master Account L.P. - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ] (b) [ ] - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS OO - -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ] - -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION Cayman Islands - -------------------------------------------------------------------------------- SHARES BENEFICIALLY OWNED 7 SOLE VOTING POWER BY EACH REPORTING PERSON 0 WITH ---------------------------------------------- 8 SHARED VOTING POWER 2,200,599 -------------------------------------------- 9 SOLE DISPOSITIVE POWER 0 ---------------------------------------------- 10 SHARED DISPOSITIVE POWER 2,200,599 - -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 2,200,599 - -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [ ] - -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 10.8% - -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON PN - -------------------------------------------------------------------------------- Page 3 of 10 Schedule 13D Cusip No. 891050106 - -------------------------------------------------------------------------------- 1 NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) MatlinPatterson Capital Management GP LLC - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ] (b) [ ] - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS OO - -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ] - -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION Delaware - -------------------------------------------------------------------------------- SHARES BENEFICIALLY OWNED 7 SOLE VOTING POWER BY EACH REPORTING PERSON 0 WITH ---------------------------------------------- 8 SHARED VOTING POWER 2,200,599 ---------------------------------------------- 9 SOLE DISPOSITIVE POWER 0 ---------------------------------------------- 10 SHARED DISPOSITIVE POWER 2,200,599 - -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 2,200,599 - -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [ ] - -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 10.8% - -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON 00 - -------------------------------------------------------------------------------- Page 4 of 10 Schedule 13D Cusip No. 891050106 - -------------------------------------------------------------------------------- 1 NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) David J. Matlin - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ] (b) [ ] - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS OO - -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ] - -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION United States - -------------------------------------------------------------------------------- SHARES BENEFICIALLY OWNED 7 SOLE VOTING POWER BY EACH REPORTING PERSON 0 WITH ---------------------------------------------- 8 SHARED VOTING POWER 2,200,599 ---------------------------------------------- 9 SOLE DISPOSITIVE POWER 0 ---------------------------------------------- 10 SHARED DISPOSITIVE POWER 2,200,599 - -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 2,200,599 - -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [ ] - -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 10.8% - -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON IN - -------------------------------------------------------------------------------- Page 5 of 10 Schedule 13D Cusip No. 891050106 - -------------------------------------------------------------------------------- 1 NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) Mark R. Patterson - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ] (b) [ ] - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS OO - -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ] - -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION United States - -------------------------------------------------------------------------------- SHARES BENEFICIALLY OWNED 7 SOLE VOTING POWER BY EACH REPORTING PERSON 0 WITH ---------------------------------------------- 8 SHARED VOTING POWER 2,200,599 ---------------------------------------------- 9 SOLE DISPOSITIVE POWER 0 ---------------------------------------------- 10 SHARED DISPOSITIVE POWER 2,200,599 - -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 2,200,599 - -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [ ] - -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 10.8% - -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON IN - -------------------------------------------------------------------------------- Page 6 of 10 Schedule 13D Cusip No. 891050106 - -------------------------------------------------------------------------------- 1 NAMES OF REPORTING PERSONS I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY) Michael Watzky - -------------------------------------------------------------------------------- 2 CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP (a) [ ] (b) [ ] - -------------------------------------------------------------------------------- 3 SEC USE ONLY - -------------------------------------------------------------------------------- 4 SOURCE OF FUNDS OO - -------------------------------------------------------------------------------- 5 CHECK BOX IF DISCLOSURE OF LEGAL PROCEEDINGS IS REQUIRED PURSUANT TO ITEMS 2(d) or 2(e) [ ] - -------------------------------------------------------------------------------- 6 CITIZENSHIP OR PLACE OF ORGANIZATION United States - -------------------------------------------------------------------------------- SHARES BENEFICIALLY OWNED 7 SOLE VOTING POWER BY EACH REPORTING PERSON 0 WITH ---------------------------------------------- 8 SHARED VOTING POWER 2,200,599 ---------------------------------------------- 9 SOLE DISPOSITIVE POWER 0 ---------------------------------------------- 10 SHARED DISPOSITIVE POWER 2,200,599 - -------------------------------------------------------------------------------- 11 AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH REPORTING PERSON 2,200,599 - -------------------------------------------------------------------------------- 12 CHECK BOX IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES CERTAIN SHARES [ ] - -------------------------------------------------------------------------------- 13 PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11) 10.8% - -------------------------------------------------------------------------------- 14 TYPE OF REPORTING PERSON IN - -------------------------------------------------------------------------------- Page 7 of 10 Schedule 13D Cusip No. 891050106 INTRODUCTION This Amendment ("Amendment No. 2") amends and supplements the Schedule 13D Statement, filed on March 24, 2008, (the "Initial Statement"), as amended and supplemented by Amendment No. 1 to Schedule 13D filed on June 13, 2008 ("Amendment No. 1"). The Initial Statement, Amendment No. 1 and Amendment No. 2 are collectively referred to herein as the "Statement." Capitalized terms used and not defined in this Amendment No. 2 shall have the meanings set forth in the Statement. The Initial Statement was filed on behalf of (1) MatlinPatterson Distressed Opportunities Master Account L.P., a limited partnership organized under the laws of the Cayman Islands ("MatlinPatterson Distressed"), (2) MatlinPatterson Capital Management L.P., a Delaware limited partnership ("MatlinPatterson Capital Management") by virtue of its investment authority over securities held by MatlinPatterson Distressed, (3) MatlinPatterson Capital Management GP LLC, a Delaware limited liability company ("MatlinPatterson Capital Management GP"), as the general partner of MatlinPatterson Capital Management, (4) David J. Matlin ("David Matlin") and Mark R. Patterson ("Mark Patterson") each, as a holder of 50% of the membership interests in MatlinPatterson Capital Management GP and (5) Michael Watzky ("Michael Watzky"). MatlinPatterson Distressed, MatlinPatterson Capital Management, MatlinPatterson Capital Management GP, David Matlin, Mark Patterson and Michael Watzky are collectively referred to as the "Reporting Persons" and each a "Reporting Person" to disclose the shared beneficial ownership by the Reporting Persons of 1,856,854 shares of the common stock, par value $0.15625 per share (the "Common Stock") of Toreador Resources Corporation (the "Company" or "Issuer") held by MatlinPatterson Distressed. Amendment No. 1 was filed on behalf of the Reporting Persons to disclose shares of Common Stock of the Company purchased by the Reporting Persons in open market transactions. This Amendment No. 2 is being filed on behalf of the Reporting Persons to report a letter, dated June 20, 2008, MatlinPatterson Distressed submitted to the Company. Item 4. Purpose of Transaction. Item 4 of the Statement is hereby amended and supplemented by adding the following to the end of paragraph 2 of said Item 4 as follows: On June 20, 2008, MatlinPatterson Distressed submitted a letter to the Company, filed as Exhibit 2 hereto, in which it expressed concerns about the Company's performance and direction. MatlinPatterson Distressed recommended that the board of directors proceed with a sale of the Company to improve shareholder value. Further, MatlinPatterson Distressed recommended that the Company cease all new exploration and production activities other than current commitments and to reduce its selling, general and administrative expenses starting with the elimination of the Dallas exploration and production team. Item 5. Interest in Securities of the Issuer. Item 5 of the Statement is hereby amended and restated as follows: (a)-(b) The aggregate percentage of shares of Common Stock reported owned by each of the Reporting Persons is based upon 19,936,757 shares outstanding at May 9, 2008, as reported in the Company's Form 10-Q for the fiscal quarter ended March 31, 2008. (1) MatlinPatterson Distressed is a direct beneficial owner of 2,200,599 shares of Common Stock, consisting of 2,153,880 shares of Common Stock and 5% Senior Convertible Notes due 2025 which are immediately convertible into 46,719 shares of Common Stock, and each of the other Reporting Persons is an indirect beneficial owner of 2,200,599 shares of Common Stock, consisting of 2,153,880 shares of Common Stock and 5% Senior Convertible Notes due 2025 which Page 8 of 10 Schedule 13D Cusip No. 891050106 are immediately convertible into 46,719 shares of Common Stock. The 2,200,599 shares of Common Stock represent beneficial ownership of approximately 10.8% of the Company's issued and outstanding shares of Common Stock (assuming conversion of the 5% Senior Convertible Notes due 2025 beneficially owned by MatlinPatterson Distressed). (2) MatlinPatterson Capital Management serves as investment adviser or manager to MatlinPatterson Distressed. By reason of such relationship, MatlinPatterson Capital Management may be deemed to share voting and dispositive power over the shares owned by MatlinPatterson Distressed. (3) MatlinPatterson Capital Management GP is the general partner of MatlinPatterson Capital Management. By reason of such relationship, MatlinPatterson Capital Management GP may be deemed to share voting and dispositive power over the shares owned by MatlinPatterson Distressed. (4) Mark Patterson and David Matlin are the holders of all of the membership interests in MatlinPatterson Capital Management GP. By reason of such relationships, each of Mark Patterson and David Matlin may be deemed to share voting and dispositive power over the shares owned by MatlinPatterson Distressed. (5) Michael Watzky serves as the Senior Portfolio Manager of MatlinPatterson Capital Management. By reason of such relationship, Michael Watzky may be deemed to share voting and dispositive power over the shares owned by MatlinPatterson Distressed. (c) The Form 4s filed by the Reporting Persons on June 6, 2008, June 9, 2008, June 10, 2008, June 11, 2008, June 12, 2008, June 16, 2008, June 18, 2008, June 19, 2008 and June 24, 2008 lists all transactions in the Common Stock by the Reporting Persons since Amendment No. 1. All of such transactions were purchases effected in the open market. (d) Not applicable (e) Not applicable Item 7. Material to be Filed as Exhibits Exhibit 1(*) Joint Filing Agreement by and among MatlinPatterson Capital Management L.P., MatlinPatterson Distressed Opportunities Master Account L.P., MatlinPatterson Capital Management GP LLC, David J. Matlin, Mark R. Patterson and Michael Watzky. Exhibit 2 Letter, dated June 20, 2008, from MatlinPatterson Distressed to the Chairman of the Board of Directors of the Company. Exhibit 24.1(*) Power of Attorney by David J. Matlin Exhibit 24.2(*) Power of Attorney by Mark R. Patterson Exhibit 24.3(*) Power of Attorney by Michael Watzky Exhibit 24.4(*) Power of Attorney by MatlinPatterson Capital Management GP LLC - -------------- (*) Previously filed as an Exhibit to the Statement Page 9 of 10 SIGNATURE After reasonable inquiry and to the best of our knowledge and belief, we certify that the information set forth in this Statement is true, complete and correct. Dated: June 20, 2008 MATLINPATTERSON CAPITAL MANAGEMENT L.P. By: MATLINPATTERSON CAPITAL MANAGEMENT GP LLC, its general partner By: /s/ LAWRENCE TEITELBAUM -------------------------------- Name: Lawrence Teitelbaum Title: Chief Financial Officer MATLINPATTERSON DISTRESSED OPPORTUNITES MASTER ACCOUNT L.P. By: MATLINPATTERSON DOF GP LLC, its general partner By: MP ALTERNATIVES GP HOLDINGS LLC, its managing member By: /s/ LAWRENCE TEITELBAUM ----------------------------- Name: Lawrence Teitelbaum Title: Chief Financial Officer MATLINPATTERSON CAPITAL MANAGEMENT GP LLC By: /s/ LAWRENCE TEITELBAUM ------------------------------------- Name: Lawrence Teitelbaum Title: Chief Financial Officer DAVID J. MATLIN By: /s/ LAWRENCE TEITELBAUM ------------------------------------- Lawrence Teitelbaum, by power of attorney MARK R. PATTERSON By: /s/ LAWRENCE TEITELBAUM ------------------------------------- Lawrence Teitelbaum, by power of attorney MICHAEL WATZKY By: /s/ LAWRENCE TEITELBAUM ------------------------------------- Lawrence Teitelbaum, by power of attorney Page 10 of 10 EXHIBIT INDEX Exhibit 1(*) Joint Filing Agreement by and among MatlinPatterson Capital Management L.P., MatlinPatterson Distressed Opportunities Master Account L.P., MatlinPatterson Capital Management GP LLC, David J. Matlin, Mark R. Patterson and Michael Watzky. Exhibit 2 Letter, dated June 20, 2008, from MatlinPatterson Distressed to the Chairman of the Board of Directors of the Company. Exhibit 24.1(*) Power of Attorney by David Matlin Exhibit 24.2(*) Power of Attorney by Mark Patterson Exhibit 24.3(*) Power of Attorney by Michael Watzky Exhibit 24.4(*) Power of Attorney by MatlinPatterson Capital Management GP LLC (*) Previously filed as an Exhibit to the Statement Exhibit 2 MatlinPatterson MatlinPatterson Capital Management L.P. 520 Madison Avenue New York, New York 10022-4213 Telephone: 212-651-9500 Fax: 212-651-4029 June 20, 2008 John Mark McLaughlin Chairman, Board of Directors, Toreador Resources Corporation 13760 Noel Road, Suite 1100 Dallas, TX 75240-1383 Dear Mr. McLaughlin: As you know, MatlinPatterson Distressed Opportunities Master Account L.P. is a significant shareholder of Toreador Resources Corporation, holding over 10% of the company's stock. We are writing you to express our deep concerns about the company's performance and direction and to give you our recommendations for improving shareholder value. In the past eighteen months, the company's shareholders have suffered through exploration failures, capital misallocations, poor corporate governance, a failure to sell a portion of the company's interest in the South Akcakoca Sub-Basin project and an apparent lack of concern by management and the Board for the preservation and enhancement of the value of the company's stock. As a result, the current enterprise value of the company is currently less than PV-10 value of its French reserves alone. It is obvious to us that the current strategy is not working and that the Board must pursue alternative approaches to deliver value to the shareholders. Despite the company's disappointing performance, we believe that the company's assets, reserves and acreage would have significant potential in the hands of a competent exploration and production team. Accordingly, we believe the best way to realize value for shareholders is a sale of the company and we urge the Board to immediately hire investment bankers and proceed with a sale process. We are willing to assist the company in finding suitable investment bankers and potential acquirers and to do what we can to expedite a sale. While the company pursues a sale, we urge the company to immediately take steps to improve its results, including ceasing all new exploration and production activities other than current commitments, and to significantly reducing SG&A, starting with eliminating the Dallas exploration and production team. We urge management and the Board to take our suggestions seriously and implement them. We are not satisfied with the status quo, and, if management and the Board do not move in the direction we have outlined, we will take that as evidence that they should be replaced by people who are focused on the best interests of the company's shareholders. Sincerely yours, MatlinPatterson Distressed Opportunities Master Account L.P. By: MATLINPATTERSON DOF GP LLC, its general partner /s/ MICHAEL WATZKY /s/ MIKE SUKHADWALA --------------------------- -------------------------------- Michael Watzky Mike Sukhadwala Senior Portfolio Manager Portfolio Manager Cc: Nigel Lovett Chief Executive Officer Toreador Resources 13760 Noel Road, Suite 1100 Dallas, TX 75240-1383 -----END PRIVACY-ENHANCED MESSAGE-----