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EXHIBIT 4
SHAREHOLDER AGREEMENT
SHAREHOLDER AGREEMENT, dated as of May 1, 1998, by and between EXCO
Resources, Inc., a Texas corporation (the "Buyer"), and the shareholder listed
on the signature page hereof (the "Shareholder").
WHEREAS, the Shareholder, as of the date hereof, is the owner of the
respective number of shares of (i) Common Stock, par value $1.00 per share (the
"Gladstone Common Stock"), of Gladstone Resources, Inc., a Washington
corporation ("Gladstone"), (the "Gladstone Shares") set forth below the name of
the Shareholder on the signature page hereof;
WHEREAS, in reliance in part upon the execution and delivery of this
Agreement, the Buyer will enter into an Agreement and Plan of Merger, dated of
even date herewith, a copy of which has previously been delivered to Shareholder
and the receipt of which Shareholder hereby acknowledges (the "Merger
Agreement;" capitalized terms not defined herein shall have the meanings set
forth in the Merger Agreement), with Gladstone which provides that, among other
things, upon the terms and subject to the conditions thereof Gladstone will be
merged with and into Buyer (the "Merger"), as provided in the Merger Agreement;
WHEREAS, in reliance upon the execution and delivery of this Agreement,
the Buyer will enter into a Stock Option Agreement, dated as of the date hereof
(the "Stock Option Agreement"), with X. X. Xxxxxx, Xx.("Xxxxxx") pursuant to
which Xxxxxx has granted to the Buyer an option to acquire shares of Gladstone;
and
WHEREAS, to induce the Buyer to enter into the Merger Agreement and the
Stock Option Agreement and to incur the obligations set forth therein, the
Shareholder is entering into this Agreement pursuant to which the Shareholder
agrees to vote in favor of the Merger and certain other matters as set forth
herein upon the terms and conditions set forth herein.
NOW THEREFORE, in consideration of the foregoing and of the mutual
covenants and agreements set forth herein and for other good and valuable
consideration, the receipt and adequacy of which are hereby acknowledged, the
parties hereto agree as follows:
Section 1. Voting of Shares; Irrevocable Proxy.
The Shareholder agrees that until the earlier of (a) the Effective Time
and (b) the termination of the Merger Agreement (the earliest of such dates
being hereinafter referred to as the "Expiration Date"), the Shareholder shall
vote all Gladstone Shares owned by the Shareholder at any meetings of
Gladstone's shareholders (whether annual or special and whether or not an
adjourned or postponed meeting), or, if applicable, take action by written
consent (x) for adoption of the Merger Agreement and in favor of the Merger and
any other transaction contemplated by the Merger Agreement, as such Merger
Agreement may be modified or amended from time to time (but not to reduce the
consideration to be received by the Shareholder for her shares of Gladstone
Common Stock, and (y) against any action, omission or agreement which would
impede or interfere with, or have the effect of discouraging, the Merger,
including, without limitation, any
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Acquisition Proposal (as hereinafter defined) other than the Merger. Any such
vote shall be cast or consent shall be given in accordance with such procedures
relating thereto as shall ensure that it is duly counted for purposes of
determining that a quorum is present and for purposes of recording the results
of such vote or consent.
In the event that the Shareholder shall fail to comply with the
provisions of this Section 1 (as determined by the Buyer in good faith), the
Shareholder hereby agrees that such failure shall result, without any further
action by the Shareholder, in the irrevocable appointment of the Buyer, until
the Expiration Date, as his attorney-in-fact and proxy, with full power of
substitution, to vote and otherwise act (by written consent or otherwise) with
respect to the Gladstone which the Shareholder is entitled to vote at any
meeting of shareholders (whether annual or special and whether or not an
adjourned or postponed meeting) or consent in lieu of any such meeting or
otherwise, on the matters and in the manner specified in Section 1 above. THE
SHAREHOLDER ACKNOWLEDGES THAT THIS PROXY IS COUPLED WITH AN INTEREST AND
CONSTITUTES, AMONG OTHER THINGS, AN INDUCEMENT FOR THE BUYER TO ENTER INTO THE
MERGER AGREEMENT, IS IRREVOCABLE AND SHALL NOT BE TERMINATED BY OPERATION OF LAW
UPON THE OCCURRENCE OF ANY EVENT, INCLUDING, WITHOUT LIMITATION, THE DEATH OR
INCAPACITY OF THE SHAREHOLDER.
Section 2. Covenants of the Shareholder.
The Shareholder covenants and agrees for the benefit of the Buyer that,
until the Expiration Date, she:
(a) will not sell, transfer, pledge, hypothecate, encumber,
assign, tender or otherwise dispose of, or enter into any contract,
option or other arrangement or understanding with respect to the sale,
transfer, pledge, hypothecation, encumbrance, assignment, tender or
other disposition of (any one or more of which, a "Transfer"), any of
the Gladstone Shares owned by her unless, in connection with such
Transfer, the transferee executes a counterpart of this Agreement
agreeing to be bound by the terms hereof;
(b) will, other than as expressly contemplated by this
Agreement, not grant any powers of attorney or proxies or consents in
respect of any of the Gladstone Shares owned by her, deposit any of the
Gladstone Shares owned by her into a voting trust, enter into a voting
agreement with respect to any of the Gladstone Shares owned by her or
otherwise restrict the ability of the holder of any of the Gladstone
Shares owned by her to freely exercise all voting rights with respect
thereto;
(c) will not cause Gladstone to take any action or (ii)
consent to Gladstone taking any action, prohibited by Section 7.1 of
the Merger Agreement;
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(d) will not knowingly take any action whatsoever that, based
on advice from the Buyer's auditors, would prevent the Merger from
qualifying for "pooling of interests" accounting treatment;
(e) will use her reasonable best efforts to take, or cause to
be taken, all action, and do, or cause to be done, all things necessary
or advisable in order to consummate and make effective the transactions
contemplated by this Agreement;
(f) will not exercise any appraisal or dissenter's rights, if
any, with respect to the Gladstone Shares;
(g) will cooperate in all respects with Buyer in the
preparation of proxy materials to be filed with the Securities and
Exchange Commission (the "SEC") and any state securities authorities as
contemplated by the Merger Agreement, including, without limitation,
providing all data and information that Buyer shall deem necessary for
said filings and as shall be required by the Securities Act and the
Exchange Act. Any information supplied by Shareholder specifically for
use in the preparation of and inclusion in proxy materials shall not,
at the date such proxy materials (or any amendment thereof or
supplement thereto) are filed with the SEC, at the time of the
Gladstone Meeting and at the Effective Time, be false or misleading
with respect to any material fact, or omit to state any material fact
necessary in order to make the statements made therein, in the light of
the circumstances under which they are made, not misleading. If at any
time prior to the Effective Time any event relating to Shareholder
should be discovered by Shareholder which renders the information
previously provided by Shareholder specifically for use in the
preparation of and inclusion in the proxy materials inaccurate in any
material respect, Shareholder shall promptly inform Buyer in writing;
(h) at Closing Shareholder shall deliver to Buyer: (i) a
release of all claims Shareholder may have against Buyer or Gladstone
(except for claims arising out of this Agreement, the Merger Agreement
and other agreements, certificates and documents entered into pursuant
to the Merger Agreement) and (ii) a certificate signed by Shareholder
confirming the accuracy of the representations made by Shareholder in
this Agreement as if such representations were made at the Closing
Date; and
Section 3. Covenants of the Buyer.
The Buyer covenants and agrees for the benefit of the Shareholder that
(a) immediately upon execution of this Agreement, the Buyer shall enter, and
cause Gladstone to enter, into the Merger Agreement, and (b) until the
Expiration Date, it shall use its reasonable best efforts to take, or cause to
be taken, all action, and do, or cause to be done, all things necessary or
advisable in order to consummate and make effective the transactions
contemplated by this Agreement and the Merger Agreement, consistent with the
terms and conditions of each such agreement.
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Section 4. Representations and Warranties of the Shareholder.
The Shareholder represents and warrants to the Buyer that: (a) the
execution, delivery and performance by the Shareholder of this Agreement will
not conflict with, require a consent, waiver or approval under, or result in a
breach or a default any contract, commitment or other obligations (written or
oral) to which the Shareholder is bound; (b) this Agreement has been duly
executed and delivered by the Shareholder and constitutes a valid and binding
obligation of the Shareholder, enforceable against the Shareholder in accordance
with its terms, except as may be limited by bankruptcy, insolvency and other
laws relating to and affecting creditors' rights generally and equitable
remedies; (c) other than as set forth herein; the Shareholder has not entered
into an irrevocable proxy with respect to the Gladstone Shares; (d) as of the
date hereof, she is, and at the Closing Date (as defined in the Merger
Agreement) she will be, the sole beneficial owner of the number of shares of
Gladstone Common Stock shown below her name on the signature page hereto; (e)
the Shareholder has the power, authority and legal capacity to execute and
deliver this Agreement and perform her obligations under this Agreement; and (f)
as of the date hereof, there are, and at the Closing Date there will be, no
actions, suits or proceedings pending or threatened involving the ownership by
her of her Gladstone Shares or her ability to execute and deliver this
Agreement.
The representations and warranties contained herein shall be made as of
the date hereof and as of the Closing Date (as defined in the Merger Agreement)
and Shareholder shall deliver a certificate to that effect at Closing.
Section 5. Adjustments; Additional Shares.
In the event (a) of any stock dividend, stock split, recapitalization,
reclassification, combination or exchange of shares of capital stock of
Gladstone on, of or affecting the Gladstone Shares of the Shareholder, or (b)
the Shareholder shall acquire voting rights with respect to any additional
shares of Gladstone Common Stock or other securities of Gladstone, including any
securities entitling the holder thereof to vote or give consent with respect to
the matters set forth in Section 1 hereof, then the terms of this Agreement
shall apply to the shares of capital stock held by the Shareholder immediately
following the effectiveness of the events described in clause (a) or the
Shareholder becoming the beneficial owner thereof, as described in clause (b),
as though they were Gladstone Shares hereunder. As soon as practicable after the
receipt of such other capital stock or securities, the Shareholder shall
surrender to Gladstone, as the case may be, all certificates or instruments
representing such for the purpose of affixing the legend set forth in Section 22
hereof.
Section 6. Actions After Closing Date.
Shareholders and Buyer shall cooperate with one another in good faith
in connection with the defense by either of any suit, action, claim or
proceeding, or in connection with an audit or request for information by any
taxing authority, arising out of or relating to the conduct of Gladstone's
business prior to or after the Closing. Such cooperation shall include, at the
expense of the requesting party, supplying such factual and technical
information as one party shall possess
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and another may reasonably require in connection with any such defense, audit or
request for information or to respond to discovery proceedings in any such suit,
action, claim or proceeding. No party, however, shall be required to cooperate
if such cooperation would prejudice the rights of the party called upon to
provide information.
Section 7. Indemnities.
(a) Subject to the other provisions of this Section 7, the
Shareholder agrees to defend, indemnify, and hold Buyer, its successors
and assigns, and its respective officers, directors, shareholders,
agents and employees, harmless from and against, and promptly reimburse
them for any and all losses, expenses, damages, deficiencies,
liabilities, payments, penalties, litigation, demands, defenses,
judgments, proceedings, costs, obligations, settlement costs, and
attorneys', accountants' and other professional advisors' fees
(including costs of investigation and preparation) of any kind or
nature whatsoever (collectively, "Losses"), directly or indirectly
arising out of, resulting from, relating to or in connection with any
breach of, inaccuracy in, or nonperformance of, any representation,
warranty, covenant, or agreement of (i) Gladstone contained in the
Merger Agreement or (ii) Shareholder contained in this Agreement.
Shareholder is considered a direct indemnitor of Buyer and in no event
shall Buyer be required to pursue any indemnity claim hereby against
Gladstone or any other indemnitor.
(b) Subject to the other provisions of this Section 7, Buyer
agrees to defend, indemnify, and hold Shareholder, her heirs,
successors, assigns and agents, harmless from and against, and promptly
reimburse her for, any and all Losses directly or indirectly arising
out of, resulting from, relating to or in connection with any breach
of, inaccuracy in, or nonperformance of, any representation, warranty,
covenant, or agreement of Buyer contained in this Agreement or the
Merger Agreement.
(c) Anything herein to the contrary notwithstanding, for
purposes of the indemnity of Buyer by the Shareholder provided for in
subsection (a) of this Section 7: (i) as to the Shareholder together
with all of the other Gladstone shareholders executing an agreement
similar to this Agreement combined (collectively the "Gladstone
Shareholders"), the aggregate of all Losses that may be recovered
against the Gladstone Shareholders pursuant to Section 7(a), together
with all Losses that may be recovered against Gladstone under or
pursuant to the Merger Agreement, shall not exceed $1,400,000 and such
indemnity by the Gladstone Shareholders shall be applicable only to the
extent the aggregate of all Losses exceed the sum of $100,000 (ii) the
representations, warranties, covenants and agreements (other than those
in Section 6, 7 (to the extent only that a claim for indemnity has been
asserted by Buyer, by notice to the Shareholder prior to the first
anniversary of the Closing Date), 8 and 10 through 21) of the
Shareholder contained in this Agreement shall not survive past the
first anniversary of the Closing Date; and (iii) the indemnity provided
in subsection (a) of this Section 7, as hereinabove limited, shall be
the sole remedy of Buyer against the Shareholder with respect to any
breach, inaccuracy or nonperformance of any representation, warranty,
covenant or agreement of the Shareholder contained in this Agreement,
subject to Section 10 hereof.
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(d) Anything herein to the contrary notwithstanding, for
purposes of the indemnity of Shareholder by Buyer provided for in
subsection (b) of this Section 7: (i) as to all Gladstone Shareholders
the aggregate of all Losses that may be recovered by the Gladstone
Shareholders collectively pursuant to Section 7(b) shall not exceed
$1,400,000, together with all Losses that may be recovered against
Buyer under or pursuant to the Merger Agreement, and such indemnity by
Buyer shall be applicable only to the extent the aggregate of all
Losses exceed $100,000; (ii) the representations, warranties, covenants
and agreements (other than those in Sections 6, 7 (to the extent only
that a claim for indemnity has been asserted by a Shareholder, by
notice to Buyer prior to the first anniversary of the Closing Date), 8,
9 and 10 through 21), of Buyer contained in this Agreement shall not
survive past the first anniversary of the Closing Date; and (iii) the
indemnity provided in subsection (b) of this Section 7, as hereinabove
limited, shall be the sole remedy of Shareholder against Buyer with
respect to any breach, inaccuracy or nonperformance of any
representation, warranty, covenant or agreement of Buyer contained in
this Agreement, subject to Section 9 hereof.
(e) The defense of any indemnity claimed herein shall be
governed as follows:
(i) If any of the persons entitled to indemnification
hereunder (the "Indemnitee") receives notice of any claim or
commencement of any action or proceeding (an "Asserted
Liability") with respect to which another person (the
Indemnitor") is obligated to provide indemnification pursuant
to this Section 7, the Indemnitee shall promptly notify the
Indemnitor, describing the Asserted Liability in reasonable
detail and indicating the amount (which may be estimated) of
the loss, expense, damage, liability, or obligation that has
been or may be asserted by the Indemnitee against the
Indemnitor.
(ii) The failure of the Indemnitee to give such
notice shall not result in a loss of the Indemnitee's right to
indemnification under this Section 7 unless such failure
prejudices the Indemnitor's ability to defend against the
Asserted Liability.
(iii) No settlement or compromise of an Asserted
Liability may be made by the Indemnitee without the written
consent of the Indemnitor.
(iv) If the Indemnitor so elects, the Indemnitor, at
the Indemnitor's expense, shall assume the defense of the
Asserted Liability and shall have the right to settle or
compromise the same, except that if the Indemnitee (upon the
advice of counsel) reasonably objects to such assumption on
the ground that there may be legal defenses available to the
Indemnitee that are different from or in addition to those
available to the Indemnitor, then the Indemnitee shall have
the right to employ separate counsel approved by the
Indemnitor.
(v) If the Indemnitor assumes the defense of the
Asserted Liability, the Indemnitor shall not be liable for the
fees and expenses of the Indemnitee's counsel incurred
thereafter in connection with the Asserted Liability.
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(vi) In no event shall the Indemnitor be liable for
the fees and expenses of more than one counsel for any, some
or all Indemnities in any one action or separate but similar
or related actions in the same jurisdiction arising out of the
same general allegations or circumstances, unless in the
reasonable opinion of such counsel, there is, under applicable
standards of professional conduct, a conflict on any
significant issue between the positions of any two
Indemnitees.
(f) THE INDEMNIFICATION PROVIDED IN THIS SECTION 7 SHALL BE
APPLICABLE WHETHER OR NOT ANY NEGLIGENCE OF THE INDEMNITEE IS ALLEGED
OR PROVEN. INDEMNITEE SHALL TAKE REASONABLE ACTIONS TO MITIGATE ANY
DAMAGES UPON BECOMING AWARE OF ANY EVENT GIVING RISE TO A BREACH ON THE
PART OF THE INDEMNITOR.
Section 8. Transfer of Claims.
Subject to and effective upon consummation of the Closing and the
receipt in full of the consideration paid to the Shareholder under Section 3.1
of the Merger Agreement, the Shareholder hereby transfers to Buyer by virtue of
her execution of this Agreement and without any further action or writing
required, any and all claims and causes of action, whether actual, absolute,
contingent or otherwise, the Shareholder might otherwise assert against
Gladstone or Gladstone's officers, directors or representatives based on events
occurring prior to the Closing Date, related directly or indirectly to Gladstone
or the Shareholder's investment in Gladstone; provided, however, that Buyer
hereby covenants not to xxx upon, pursue or enforce any such claim or cause of
action so transferred to Buyer and agrees not to transfer any such claim or
cause of action.
Section 9. Specific Performance.
The Shareholder acknowledges that the agreements contained in this
Agreement are an integral part of the transactions contemplated by the Merger
Agreement and the Stock Option Agreement and that, without these agreements, the
Buyer, would not enter into the Merger Agreement or the Stock Option Agreement,
and acknowledges that damages may be an inadequate remedy for any breach by it
of the provisions of this Agreement. Accordingly, the Shareholder and the Buyer
each agree that the obligations of the parties hereunder shall be specifically
enforceable and neither party shall take any action to impede the other from
seeking to enforce such right of specific performance. Both parties further
agree (a) that specific performance shall be the sole remedy for a breach under
this Agreement for which damages are inadequate, and (b) to waive any
requirement for the securing or posting of any bond in connection with the
obtaining of any such equitable relief and that this provisions is without
prejudice to any other rights that the parties hereto may have for any failure
to perform this Agreement.
Section 10. Notices.
All notices, requests, claims, demands and other communications
hereunder shall be effective upon receipt (or refusal of receipt), shall be in
writing and shall be delivered in person, by telecopy (receipt confirmed),
overnight courier services (receipt confirmed), or by mail
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(registered or certified mail, postage prepaid, return receipt requested) to the
Shareholder at the address listed on the signature page hereof, and to the Buyer
at 0000 Xxxxxxxx Xxxxx, Xxxxx 000, Xxxxxx, Xxxxx 00000, Attention: President,
facsimile number (000) 000-0000, or to such other address as any party may have
furnished to the other in writing in accordance herewith.
Section 11. Binding Effect.
Upon execution and delivery of this Agreement by the Buyer and upon
execution and delivery of agreements virtually identical in form and substance
to this Agreement by the Buyer , this Agreement shall become effective as to the
Shareholder at the time the Shareholder executes and delivers this Agreement.
This Agreement shall inure to the benefit of and be binding upon the parties
hereto and their respective heirs, personal representatives, successors and
assigns.
Section 12. Assignment.
The Buyer may, without the consent of the Shareholder, assign its
rights hereunder to any direct or indirect wholly owned subsidiary of the Buyer,
provided that any such assignment shall not affect the obligations of the Buyer
hereunder.
Section 13. Governing Law.
THIS AGREEMENT IS MADE PURSUANT TO, WILL BE CONSTRUED UNDER, AND WILL
BE CONCLUSIVELY DEEMED FOR ALL PURPOSES TO HAVE BEEN EXECUTED AND DELIVERED
UNDER, THE SUBSTANTIVE LAWS OF THE STATE OF TEXAS WITHOUT REGARD TO ITS
PRINCIPLES OF CONFLICTS OF THE LAW, EXCEPT TO THE EXTENT THAT WASHINGTON GENERAL
CORPORATION LAW SHALL GOVERN THE INTERNAL AFFAIRS OF GLADSTONE. THE OBLIGATIONS
AND UNDERTAKINGS OF EACH OF THE PARTIES TO THIS AGREEMENT SHALL BE PERFORMABLE
IN DALLAS COUNTY, TEXAS.
Section 14. Counterparts.
This Agreement may be executed in several counterparts, each of which
shall be an original, but all of which together shall constitute one and the
same agreement.
Section 15. Effect of Headings.
The section headings are for convenience only and shall not affect the
construction hereof.
Section 16. Additional Agreements; Further Assurance.
Subject to the terms and conditions herein provided, each of the
parties hereto agrees to use all reasonable efforts to take, or cause to be
taken, all action and to do, or cause to be done, all things necessary, proper
or advisable to consummate and make effective the transactions contemplated by
this Agreement. The Shareholder will provide the Buyer with all documents
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which may reasonably be requested by the Buyer and will take reasonable steps to
enable the Buyer to obtain all rights and benefits it hereunder.
Section 17. Amendment; Waiver.
No amendment or waiver of any provision of this Agreement or consent to
departure therefrom shall be effective unless in writing and signed by the Buyer
and the Shareholder, in the case of an amendment, or by the party which is the
beneficiary of any such provision, in the case of waiver or a consent to
departure therefrom.
Section 18. Gender.
Whenever required by the context of this Agreement, the singular shall
include the plural, the male gender shall include the female gender and the
neuter, and vice versa.
Section 19. Severability.
If any term or other provision of this Agreement is invalid, illegal or
incapable of being enforced by any rule of law, or public policy, all other
conditions and provisions of this Agreement shall nevertheless remain in full
force and effect so long as the economic or legal substance of the transactions
contemplated hereby is not affected in any manner adverse to any party. Upon
such determination that any term or other provision is invalid, illegal or
incapable of being enforced, the parties hereto shall negotiate in good faith to
modify this Agreement so as to effect the original intent of the parties as
closely as possible in an acceptable manner to the end that transactions
contemplated hereby are fulfilled to the extent possible.
Section 20. Entire Agreement.
This Agreement constitutes the entire agreement and supersedes all
prior agreements and undertakings, both written and oral, among the parties, or
any of them, with respect to the subject matter hereof and, except as otherwise
expressly provided herein, are not intended to confer upon any other person any
rights or remedies hereunder.
Section 21. Choice of Forum; Consent to Service of Process.
The parties hereto agree that any suit, action or proceeding arising
out of or relating to this Agreement or any agreement or obligation delivered in
connection with this Agreement or any judgment entered by any court in respect
thereof shall be brought in the Courts of the State of Texas, County of Dallas
or in the United States District Court for the Northern District of Texas and
each such party hereby submits to the exclusive jurisdiction of such courts for
the purpose of any such suit, action or proceeding relating to this Agreement or
any related agreement or obligation. The Shareholder hereby agrees that until
the 2nd anniversary of the Closing Date of the Merger Agreement, service of all
writs, process and summonses in any such suit, action or proceeding brought in
the United State may be made upon CT Corporation System at its offices located
at 000 Xxxxx Xx. Xxxx Xxxxxx, Xxxxxx, Xxxxx 00000 (or any subsequent address of
CT
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Corporation System), and Shareholder hereby irrevocably appoints CT Corporation
System his true and lawful attorney-in-fact in his name, place and xxxxx to
accept such service of any and all writs, process and summonses, and agrees that
the failure of CT Corporation System to give to Shareholder any notice of any
such service of process shall not impair or affect the validity of such service
or of any judgment based thereon. Contemporaneously with any service upon CT
Corporation System hereby, Buyer shall mail by certified or registered United
States Mail, postage prepaid with return receipt requested, a copy of such writ,
process or summons to Shareholder at the address shown on the signature page (or
any other address provided by Shareholder to Buyer in writing). Buyer hereby
agrees that notwithstanding any Federal or state rule of civil procedure to the
contrary, any response of Shareholder to the initiation of such proceeding shall
not be due prior to the 40th day following service upon CT Corporation System.
Each party hereto hereby irrevocably waives any objection that it may
now or hereafter have to the laying of venue of any suit, action or proceeding
arising out of or relating to this Agreement or any agreement or obligation
delivered in connection with this Agreement, brought in the Courts of the State
of Texas, County of Dallas or the United States District Court for the Northern
District of Texas, and hereby further irrevocably waives any claim that any such
suit, action or proceeding brought in any such court has been brought in an
inconvenient forum.
Section 22. Legend.
As soon as practicable following the execution of this Agreement by
Shareholder, Shareholder shall deliver to Gladstone, as the case may be, the
Gladstone Shares held by Shareholder. Gladstone shall affix to each certificate
the following legend:
THE SHARES OF COMMON STOCK REPRESENTED BY THIS CERTIFICATE ARE SUBJECT
TO A SHAREHOLDER AGREEMENT (THE "SHAREHOLDER AGREEMENT") AND A STOCK OPTION
AGREEMENT, EACH DATED May 1, 1998, BETWEEN THE HOLDER OF THESE SHARES AND EXCO
RESOURCES, INC. A COPY OF THE SHAREHOLDER AGREEMENT IS ON FILE WITH THE
CORPORATION AT ITS PRINCIPAL EXECUTIVE OFFICES AND MAY BE OBTAINED BY REQUESTING
SAME FROM THE CORPORATION'S SECRETARY AT 000 XXXXXXX XXXXXXXXx XXXXXX, XXXXX
00000. THE SHARES OF COMMON STOCK REPRESENTED BY THIS CERTIFICATE MAY NOT BE
SOLD, TRANSFERRED, PLEDGED, HYPOTHECATED, ENCUMBERED, ASSIGNED, TENDERED OR
OTHERWISE DISPOSED OF, OTHER THAN IN ACCORDANCE WITH THE SHAREHOLDER AGREEMENT.
THE SHARES OF COMMON STOCK REPRESENTED BY THIS CERTIFICATE ARE THE SUBJECT OF AN
IRREVOCABLE PROXY, COUPLED WITH AN INTEREST, GRANTED TO EXCO RESOURCES, INC.
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IN WITNESS WHEREOF, this Agreement has been duly executed by the
parties hereto all as of the day and year first above written.
EXCO Resources, INC.
By: /s/ XXXXXXX X. XXXXXX
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Xxxxxxx X. Xxxxxx
Chief Executive Officer
Shareholder:
/s/ XXXXXXX X. XXXXX
-----------------------------------
Xxxxxxx X. Xxxxx
Address: 0000 Xxxxxxxxxx
Xxxxxx, Xx. 75205
Number of Gladstone Shares: 351,000
STATE OF TEXAS )
)
COUNTY OF DALLAS )
BEFORE ME, a Notary Public in and for the State of Texas, on this day
personally appeared Xxxxxxx X. Xxxxx, known to me to be the person whose name is
subscribed to the foregoing instrument and acknowledged to me under oath that
he/she executed the same for the purposes and consideration therein expressed.
GIVEN UNDER MY HAND and the seal of my office in Dallas County, Texas,
this the 30th day of April, 1998.
/s/ XXXXXXX XXXXXXXX
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Notary Public in and for the State of Texas
My commission expires: 1/06/02
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[Notary Public Seal]
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