EXHIBIT 3
EXCO RESOURCES, INC.
0000 XXXXXXXX XXXXX
XXXXX 000
XXXXXX, XX 00000
August 12, 1998
OCM Principal Opportunities Fund, L.P.
c/o Oaktree Capital Management, LLC
000 Xxxxx Xxxx Xxxxxx, 00xx Xxxxx
Xxx Xxxxxxx, XX 00000
Attention: Xxxxxxx X. Xxxxxx
Dear Sirs:
This letter confirms the agreement of EXCO Resources, Inc. (the
"Company") to provide certain contractual rights set forth below to OCM
Principal Opportunities Fund, L.P. (the "Fund") in connection with the Fund's
investment in any of the securities of the Company (the "Securities"). During
the period of time when the Fund holds Securities, the Fund shall be entitled to
the following rights (the "Management Rights"):
The Fund (or any designated representative on behalf of the Fund)
shall be entitled to (a) discuss the business, operations, properties and
financial and other conditions of the Company with any authorized officer,
employee, agent, representative, director or independent accountant of the
Company and, upon reasonable notice to the Company, any such authorized officer,
agent, representative, director or independent accountant of any subsidiary of
the Company, (b) submit proposals or suggestions to the Company's management
from time to time with the requirement that the management of the company and,
upon reasonable notice to the Company, management of any subsidiary of the
Company shall discuss such proposals or suggestions with the Fund (or any
designated representative on behalf of the Fund) within a reasonable period of
time after such submission and (c) call a meeting at reasonable times and upon
reasonable notice with the management of the Company and, upon reasonable notice
to the Company, management of any subsidiary of the Company in order to discuss
such proposals or suggestions or for other purposes.
The Fund agrees that it will not disclose to any third party, other
than any of the Fund's or its general partner's, directors, employees,
attorneys, accountants or other representatives which the Fund or its general
partner reasonably believes have a need to know such information or any other
party that is bound by a similar confidentiality agreement with or for the
benefit of the Company, any information provided to the Fund by the Company
hereunder which is not generally available to the public except (i) any such
information which is independently developed by the Fund without the use of any
confidential information or
becomes available to the Fund on a non-confidential basis from a person who to
the Fund's knowledge is not bound by a confidentiality agreement with the
company, (ii) with the prior express consent of the Company or (iii) as many
otherwise be required or requested by any court or governmental agency or as
may be required by applicable law.
The Management Rights granted to the Fund hereunder are not in
substitution for, and shall not be deemed to be in limitation of, any rights
otherwise available to the Fund as a holder of Securities.
Very truly yours,
By: /s/ XXXXXXX X. XXXXXX
----------------------------------
Xxxxxxx X. Xxxxxx
Chairman and Chief Executive Officer
Agreed to and accepted as of the
date set forth above
OCM Principal Opportunities Fund, L.P.
By: Oaktree Capital Management, LLC
its General Partner
By: /s/ XXXXXXX X. XXXXXX
----------------------------------
Xxxxxxx X. Xxxxxx
Principal
By: /s/ XXXXXXX X. XXXXXX
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Xxxxxxx X. Xxxxxx
Managing Director
