TOREADOR ROYALTY CORPORATION
1994 NONEMPLOYEE DIRECTOR STOCK OPTION PLAN
It is the purpose of the Plan to promote the interests of the Company and its stockholders by attracting and
retaining qualified Nonemployee Directors by giving them the opportunity to acquire a proprietary interest in the
Company and an increased personal interest in its continued success and progress. The Options granted
hereunder shall not be qualified as "incentive stock options" within the meaning of Section 422(b) of the Code.
As used herein the following terms have the following meanings:
(a) "Board" means the Board of Directors of the Company.
(b) "Code" means the Internal Revenue Code of 1986, as amended.
(c) "Common Stock" means the $.15625 par value Common Stock of the Company.
(d) "Company" means Toreador Royalty Corporation, a Delaware corporation.
(e) "Effective Date" means September 8, 1994, which shall be the date on which the Plan shall be effective.
(f) "Effective Date Options" means those options granted automatically as of the Effective Date to each
Nonemployee Director who is serving the Company as a director on such date.
(g) "Fair Market Value" means, with respect to Effective Date Options, the closing sales price on the Effective
Date of a share of Common Stock as reported on the NASDAQ National Market System. With respect to
Options subsequently granted, "Fair Market Value" means the closing sales price on the date in question (or, if
there was no reported sale on such date, on the last preceding day on which any reported sale occurred) of a
share of Common Stock as reported on the principal national stock exchange on which the Common Stock is
then listed or admitted to trading or, if the Common Stock is not listed or admitted to trading on any national
stock exchange but is listed as a national market security on the National Association of Securities Dealers, Inc.
Automated Quotations System ("NASDAQ"), as reported on NA