<PAGE>
As filed with the Securities and Exchange Commission on September 25, 1998
Registration No. 333-
- --------------------------------------------------------------------------------
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
EXCO RESOURCES, INC.
(Exact name of registrant as specified in its charter)
TEXAS 74-1492779
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
5735 PINELAND DRIVE, SUITE 235
DALLAS, TEXAS 75231
(Address of Principal Executive Offices) (Zip Code)
EXCO RESOURCES, INC. 1998 STOCK OPTION PLAN
EXCO RESOURCES, INC. 1998 DIRECTOR COMPENSATION PLAN
(Full title of the Plan)
DOUGLAS H. MILLER
CHIEF EXECUTIVE OFFICER
5735 PINELAND DRIVE, SUITE 235
DALLAS, TEXAS 75231
(Name and address of agent for service)
(214) 368-2084
(Telephone number, including area code, of agent for service)
With copies to:
RICHARD E. MILLER WILLIAM L. BOEING
GENERAL COUNSEL HAYNES AND BOONE, LLP
5735 PINELAND DRIVE 901 MAIN STREET
SUITE 235 SUITE 3100
DALLAS, TEXAS 75231 DALLAS, TEXAS 75202-3789
(214) 368-2084 (214) 651-5000
<TABLE>
<CAPTION>
CALCULATION OF REGISTRATION FEE
- -----------------------------------------------------------------------------------------------------------------------------
TITLE OF SECURITIES AMOUNT MAXIMUM OFFERING PROPOSED MAXIMUM AMOUNT OF
TO BE REGISTERED TO BE REGISTERED/(1)/ PRICE PER SHARE AGGREGATE OFFERING PRICE/(2)/ REGISTRATION FEE/(2)/
- -----------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C>
Common Stock, $.02 par value 1,600,000 $ 7.25 $ 11,600,000 $ 3,422
- -----------------------------------------------------------------------------------------------------------------------------
</TABLE>
(1) The number of shares being registered represents (i) 1,500,000 shares being
registered under the EXCO Resources, Inc. 1998 Stock Option Plan and (ii)
100,000 shares being registered under the EXCO Resources, Inc. 1998 Director
Compensation Plan. The amount to be registered also includes such
indeterminate number of shares as may be issued to prevent dilution
resulting from stock splits, stock dividends or similar transactions in
accordance with Rule 416 promulgated under the Securities Act of 1933.
(2) The offering price per share, the aggregate offering price and the
registration fee should be calculated in accordance with paragraphs (c) and
(h)(1) of Rule 457 promulgated under the Securities Act of 1933 based on the
average of the high and low sale prices for the Company's Common Stock
reported on the Nasdaq National Market System on September 24, 1998
($7.25 per share).
- --------------------------------------------------------------------------------
<PAGE>
EXCO RESOURCES, INC.
1,600,000 SHARES OF COMMON STOCK
PART II
INFORMATION REQUESTED IN THE REGISTRATION STATEMENT
ITEM 3. INCORPORATION OF DOCUMENTS BY REFERENCE
EXCO Resources, Inc. (the "Company") hereby incorporates by reference
the following documents filed with the Securities and Exchange Commission (the
"Commission"):
a) The Company's Annual Report on Form 10-K for the fiscal year
ended December 31, 1997;
b) The Company's Quarterly Report on Form 10-Q for the fiscal
quarter ended March 31, 1998;
c) The Company's Quarterly Report on Form 10-Q for the fiscal
quarter ended June 30, 1998;
d) The Company's Current Report on Form 8-K dated January 14,
1998;
e) The Company's Current Report on Form 8-K dated February 25,
1998, as amended by Form 8-K/A Amendment No. 1 filed
April 8, 1998;
f) The Company's Current Report on Form 8-K dated May 1, 1998;
g) The Company's Current Report on Form 8-K dated May 8, 1998;
h) The Company's Current Report on Form 8-K dated June 30,
1998;
i) The Company's Current Report on Form 8-K dated August 13,
1998;
j) The description of the Company's Common Stock contained in
the Company's Registration Statement on Form 10 filed on
April 21, 1980; and
k) All documents subsequently filed by the Company pursuant to
Sections 13(a), 13(c), 14, and 15(d) of the Securities
Exchange Act of 1934, as amended, prior to the filing of a
post-effective amendment that indicates that all securities
offered hereunder have been sold or that deregisters all
securities then remaining unsold, shall be deemed to be
incorporated by reference herein and to be a part hereof
from the date such documents are filed. Any statement
contained in a document incorporated or deemed to be
incorporated by reference herein shall be deemed to be
modified or superseded for purposes of this Registration
Statement to the extent that a statement contained herein or
in any other subsequently filed document which also is or is
deemed to be incorporated by reference in this Registration
Statement modifies or supersedes such statement.
<PAGE>
ITEM 4. DESCRIPTION OF SECURITIES
Not applicable.
ITEM 5. INTERESTS OF NAMED EXPERTS AND COUNSEL
Not applicable.
ITEM 6. INDEMNIFICATION OF DIRECTORS AND OFFICERS
The Company has authority under Articles 2.02(A)(16) and 2.02-1 of the
Texas Business Corporation Act to indemnify its officers and directors to the
extent provided for in such statute.
Article VI of the Company's Restated Bylaws provides that the Company
shall indemnify each of its directors and officers, its former directors and
officers and agents of the Company against expenses actually and reasonably
incurred by him or her in connection with the defense of any action, suit or
proceeding, civil or criminal, in which such person is made a party by reason of
being or having been such director or officer, except in situations where he or
she shall be adjudged in such action, suit or proceeding to be liable for
negligence or misconduct in the performance of his or her duty to the Company.
In the event of a criminal conviction (whether based on a plea of guilty or nolo
contendere or its equivalent, or after trial), such conviction shall not be
deemed an adjudication of liability for negligence or misconduct in the
performance of duty to the Company if such director or officer acted in good
faith in what he or she considered to be the best interest of the Company and
without reasonable cause to believe that his or her actions were illegal. In
absence of an adjudication which expressly absolves the director or officer of
liability to the Company or its shareholders for negligence or misconduct, or in
the event of a settlement, the right to indemnification of a director or officer
shall be conditioned upon prior resolution adopted by two-thirds of the
disinterested members of the Board or by independent counsel.
The Company intends to maintain insurance against liabilities incurred
by its officers and directors in defense of actions to which they are made
parties by reason of their positions as officers and directors.
Insofar as indemnification for liabilities arising under the Securities
Act of 1933 is permitted for directors, officers or persons controlling the
Company pursuant to the foregoing provisions, the Company has been informed that
in the opinion of the Commission such indemnification is against public policy
as expressed in the Securities Act of 1933 and is therefore unenforceable.
For the undertaking with respect to indemnification, see Item 9 herein.
ITEM 7. EXEMPTION FROM REGISTRATION CLAIMED
Not applicable.
ITEM 8. EXHIBITS
Exhibit No. Description of Exhibits
- ----------- -----------------------
4.1 - Restated Articles of Incorporation of the Company, as
amended, filed as Exhibit 4.1 to Form S-2 (333-49135) filed
on June 2, 1998.
-2-
<PAGE>
4.2 - Restated By-laws of the Company, as amended, filed as
Exhibit 4.2 to Form S-2 (333-49135) filed on June 2, 1998.
4.3 - Specimen Stock Certificate for the Common Stock of the
Company filed as Exhibit 4.3 to Form S-2 (333-49135) filed
on June 2, 1998.
4.4 - EXCO Resources, Inc. 1998 Stock Option Plan, filed as
Appendix A to the Company's Definitive Proxy Statement on
Schedule 14A dated March 17, 1998 and incorporated by
reference herein.
4.5* - Amendment to EXCO Resources, Inc. 1998 Stock Option Plan
dated September 15, 1998.
4.6* - EXCO Resources, Inc. 1998 Director Compensation Plan.
4.7* - Form of Incentive Stock Option Agreement.
5.1* - Opinion of Haynes and Boone, LLP with respect to validity of
the issuance of the securities.
23.1* - Consent of Belew Averitt LLP, independent auditors.
23.2* - Consent of Ernst & Young LLP, independent auditors.
23.3* - Consent of Harold L. Ratcliff, C.P.A.
23.4* - Consent of Haynes and Boone, LLP (included in Exhibit 5.1).
23.5* - Consent of Lee Keeling and Associates, Inc., independent
petroleum engineers.
23.6* - Consent of Milmac Operating Company, independent petroleum
engineers.
24.1* - Power of attorney of the directors of the Company (included
on the signature page of the Registration Statement).
- -----------
* Filed herewith
ITEM 9. UNDERTAKINGS
a. The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this Registration Statement:
(i) to include any prospectus required by Section 10(a)(3)
of the Securities Act of 1933;
(ii) to reflect in the prospectus any facts or events
arising after the effective date of the Registration
Statement (or the most recent post-effective amendment
thereof) which, individually or in the aggregate,
represent a fundamental change in the information set
forth in the Registration Statement; and
-3-
<PAGE>
(iii) to include any material information with respect to
the plan of distribution not previously disclosed in
the Registration Statement or any material change to
such information in the Registration Statement;
provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) will not apply
if the information required to be included in a post-effective amendment
by those paragraphs is contained in periodic reports filed by the
registrant pursuant to Section 13 or Section 15(d) of the Securities
Exchange Act of 1934 that are incorporated by reference in this
Registration Statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be
deemed to be a new registration statement relating to the securities
offered therein, and the offering of such securities at that time shall
be deemed to be the initial bona fide offering thereof; and
(3) To remove from registration by means of a post-effective
amendment any of the securities being registered which remain unsold at
the termination of the offering.
b. The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 (and, where applicable, each filing of an
employee benefit plan's annual report pursuant to Section 15(d) of the
Securities Exchange Act of 1934) that is incorporated by reference in the
Registration Statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such securities
at that time shall be deemed to be the initial bona fide offering thereof.
c. Insofar as indemnification for liabilities arising under the
Securities Act of 1933 may be permitted to directors, officers and controlling
persons of the registrant pursuant to the foregoing provisions, or otherwise,
the registrant has been advised that in the opinion of the Commission such
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer or controlling
person of the registrant in the successful defense of any action, suit or
proceeding) is asserted by such director, officer or controlling person in
connection with the securities being registered, the registrant will , unless in
the opinion of its counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question whether such
indemnification by it is against public policy as expressed in the Securities
Act of 1933 and will be governed by the final adjudication of such issue.
-4-
<PAGE>
SIGNATURES AND POWER OF ATTORNEY
THE COMPANY:
Pursuant to the requirements of the Securities Act of 1933, the Company
certifies that it has reasonable grounds to believe that it meets all of the
requirements for filing on Form S-8 and has duly caused this Registration
Statement to be signed on its behalf by the undersigned, thereunto duly
authorized, in the City of Dallas, State of Texas, on the 25th day of September,
1998.
EXCO RESOURCES, INC.
By: /s/ DOUGLAS H. MILLER
--------------------------------------------
Name: Douglas H. Miller
Title: Chairman and Chief Executive Officer
KNOW ALL MEN BY THESE PRESENTS, that each person whose signature appears below
constitutes and appoints each of Douglas H. Miller and T.W. Eubank, his true and
lawful attorneys-in-fact and agents, with full power of substitution and
resubstitution, for him and in his name, place and stead, in any and all
capacities, to sign, execute and file with the Securities and Exchange
Commission and any state securities regulatory board or commission any documents
relating to the proposed issuance and registration of the securities offered
pursuant to this Registration Statement on Form S-8 under the Securities Act of
1933, including any amendment or amendments relating thereto (and any additional
Registration Statement related hereto permitted by Rule 462(b) promulgated under
the Securities Act of 1933, including any amendment or amendments relating
thereto), with all exhibits and any and all documents required to be filed with
respect thereto with any regulatory authority, granting unto said attorneys-in-
fact and agents, and each of them, full power and authority to do and perform
each and every act and thing requisite and necessary to be done in and about the
premises in order to effectuate the same as fully to all intents and purposes as
he might or could do if personally present, hereby ratifying and confirming all
that said attorneys-in-fact and agents, or either of them, or their or his
substitute or substitutes, may lawfully do or cause to be done.
Pursuant to the requirements of the Securities Act of 1933, this Registration
Statement has been signed by the following persons in the capacities indicated
on the 25th day of September, 1998.
Signature Title
- --------- -----
/s/ DOUGLAS H. MILLER Chairman, Chief Executive Officer
- -----------------------------
Douglas H. Miller
/s/ T.W. EUBANK President, Director
- -----------------------------
T.W. Eubank
<PAGE>
Signature Title
- --------- -----
/s/ J. DOUGLAS RAMSEY Chief Financial Officer, Vice President,
- ----------------------------- Director
J. Douglas Ramsey (Principal Financial and Accounting
Officer)
/s/ JEFFREY D. BENJAMIN Director
- -----------------------------
Jeffrey D. Benjamin
/s/ EARL E. ELLIS Director
- -----------------------------
Earl E. Ellis
/s/ JEFF M. MOORE Director
- -----------------------------
Jeff M. Moore
/s/ J. MICHAEL MUCKLEROY Director
- -----------------------------
J. Michael Muckleroy
/s/ T. BOONE PICKENS Director
- -----------------------------
T. Boone Pickens
/s/ STEPHEN F. SMITH Director
- -----------------------------
Stephen F. Smith
<PAGE>
EXHIBIT INDEX
Exhibit No. Description of Exhibits
- ----------- -----------------------
4.1 - Restated Articles of Incorporation of the Company, as amended,
filed as Exhibit 4.1 to Form S-2 (333-49135) filed on June 2,
1998.
4.2 - Restated By-laws of the Company, as amended, filed as Exhibit
4.2 to Form S-2 (333-49135) filed on June 2, 1998.
4.3 - Specimen Stock Certificate for the Common Stock of the Company
filed as Exhibit 4.3 to Form S-2 (333-49135) filed on June 2,
1998.
4.4 - EXCO Resources, Inc. 1998 Stock Option Plan, filed as Appendix A
to the Company's Definitive Proxy Statement on Schedule 14A
dated March 17, 1998 and incorporated by reference herein.
4.5* - Amendment to EXCO Resources, Inc. 1998 Stock Option Plan dated
September 15, 1998.
4.6* - EXCO Resources, Inc. 1998 Director Compensation Plan.
4.7* - Form of Incentive Stock Option Agreement.
5.1* - Opinion of Haynes and Boone, LLP with respect to validity of the
issuance of the securities.
23.1* - Consent of Belew Averitt LLP, independent auditors.
23.2* - Consent of Ernst & Young LLP, independent auditors.
23.3* - Consent of Harold L. Ratcliff, C.P.A.
23.4* - Consent of Haynes and Boone, LLP (included in Exhibit 5.1).
23.5* - Consent of Lee Keeling and Associates, Inc., independent
petroleum engineers.
23.6* - Consent of Milmac Operating Company, independent petroleum
engineers.
24.1* - Power of attorney of the directors of the Company (included on
the signature page of the Registration Statement).
- -------------
* Filed herewith
<PAGE>
EXHIBIT 4.5
MINUTES OF A MEETING OF
THE BOARD OF DIRECTORS
OF EXCO RESOURCES, INC.
September 15, 1998
A meeting of the Board of Directors of EXCO Resources, Inc. (The "Company")
was held by telephonic conference on September 15, 1998 at 9:00 a.m. The
directors in attendance were:
Douglas H. Miller
T. W. Eubank
J. Douglas Ramsey
Stephen F. Smith
T. Boone Pickens
Earl Ellis
Jeffery Benjamin
Jeff Moore
Mr. Miller presided over the meeting. The purpose of the meeting was to
consider and approve the following:
1. The Company's director compensation plan, a copy of which is attached
hereto as Exhibit "A";
2. Amendment of the EXCO Resources, Inc. 1998 Stock Option Plan (the
"Plan") as follows:
(a) Amendment of Article 5 of the Plan to increase the maximum number
of shares subject to the Plan from 1,000,000 to 1,500,000 shares;
(b) Amendment of Article 10.1 of the Plan to provide that the Company
may loan a Participant the money necessary to exercise a Stock
Option issued pursuant to the Plan; and
3. The recommendation of the compensation committee to issue stock options
to the directors, officers and employees of the Company as indicated on
Exhibit "B" hereto.
Following a discussion of the foregoing, the board unanimously adopted the
following resolutions:
RESOLVED, that the plan of compensation of the Directors of the Company
which is attached hereto as Exhibit "A" is hereby ratified, adopted and
confirmed;
RESOLVED, that subject to shareholder approval at the next meeting of
shareholders of the Company, the EXCO Resources, Inc. 1998 Stock Option
Plan is hereby amended as follows:
<PAGE>
(a) Article 5 of the Plan is hereby amended to increase the maximum
number of shares subject to the Plan from 1,000,000 to 1,500,000
shares; and
(b) Article 10.1 of the Plan is hereby amended to provide that the
Company may loan a Participant the money necessary to exercise a
Stock Option issued pursuant to the Plan.
RESOLVED, the Company is hereby authorized to issue stock options to the
directors, officers and employees of the Company at an option price of
$6.00 per share, in the amounts indicated on Exhibit "B" hereto and to loan
such persons the money necessary to exercise such options as they vest.
Each of the directors present at the meeting was polled regarding the
method of payment of the compensation under the director's compensation plan and
each elected to take all compensation under the plan in common stock of the
Company.
No further business coming before the board, the meeting was adjourned.
SECRETARY'S CERTIFICATE
The foregoing minutes accurately reflect the business conducted at the
meeting of the Board of Directors of EXCO Resources, Inc. held on September 15,
1998.
Richard E. Miller - Secretary
<PAGE>
EXHIBIT 4.6
EXCO RESOURCES, INC.
1998 DIRECTOR COMPENSATION PLAN
1. Purpose. The purpose of this plan is to attract and retain to EXCO
--------
Resources, Inc., a Texas corporation (the "Company"), qualified and competent
directors, upon whose efforts and judgment the success of the Company is largely
dependent and of stimulating the active interest of these persons in the
development and financial success of the Company by providing for stock
ownership in the Company by such persons.
2. Definitions. Except as otherwise stated, all capitalized terms herein
------------
shall have the meaning to such terms in the EXCO Resources, Inc. 1998 Stock
Option Plan, as adopted at the Annual Meeting of the Shareholders of the
Company held on March 31, 1998. In addition, the following terms shall have
the meaning indicated:
(a) "Annual Director Fee" shall mean an annual fee of $15,000 payable in
four (4) equal quarterly amounts to each Director on the first business
day following the end of each fiscal quarter beginning with the fiscal
quarter ended June 30, 1998 (collectively, such four (4) business days
being the "Quarterly Payment Dates"), which may be paid in cash or in
Common Stock of the Company.
(b) "Director" shall mean a member of the Board.
(c) "Option" (when capitalized) shall mean any stock option granted under
Section 5 of this Plan.
(d) "Quarterly Payment Dates" shall have the meaning set forth in Section
2(a).
(e) "Share(s)" shall mean a share or shares of the Common Stock.
3. Options. Options issued pursuant to this Director's Plan are also issued
--------
pursuant to the EXCO Resources, Inc. 1998 Stock Option Plan (the "Plan") and are
subject to all of the terms and provisions thereof. If there is a conflict
between the terms of this Director's Plan and the Plan, the terms of the Plan
shall be given effect and the conflicting provisions hereof shall be
disregarded. If any Option granted under the Plan shall terminate, expire, or be
canceled or surrendered as to any Shares, such Shares shall thereafter be
available for the payment of the Common Stock component of the Annual Director
Fee and for the granting of Options hereunder.
4. Annual Director Fee. On each of the Quarterly Payment Dates each Director
--------------------
shall at the option of such Director (to be made once per year) receive either
(a) $3,750 in cash; (b) common stock of the Company with a fair market value of
$3,750; or (c) $1,875 cash and common stock of the Company with a fair market
value of $1,875. For purposes of payment of the Common Stock component of the
Annual Director Fee, the value of the Common Stock will be the Fair Market Value
of the Common Stock on the first business day following the end of each fiscal
quarter.
<PAGE>
5. Automatic Grant of Options:
---------------------------
(a) An Option to purchase FIFTY THOUSAND (50,000) Shares of the Common
Stock shall automatically be granted to each Director on a
nondiscriminatory basis on the date such Director is initially elected
or appointed a Director of the Company, or, in the case of current
Directors, upon the adoption of this plan by the Board of Directors.
(b) Options automatically granted to Directors pursuant to this Section 5
shall be in addition to the Annual Director Fee or any other benefits
with respect to the Director's position with the Company or its
Subsidiaries. Neither the Plan nor any Option granted under the Plan
shall confer upon any person any right to continue to serve as a
Director.
(c) An Option shall vest in four (4) equal amounts of 12,500 Shares per
year over four (4) years, provided that no Shares subject to a
Director's Option shall vest in any fiscal year in which the Director
attends less than seventy-five percent (75%) of the Board meetings held
for that fiscal year. Failure to attend the requisite number of
meetings during a given year will cause a forfeiture of the 12,500
Shares subject to the Option that were eligible to vest in that year.
In the event a Director ceases to serve as such for any reason, the
unvested Shares subject to the Option will not accelerate, and the
Option shall only be exercisable for the number of Shares that vested
prior to the Director ceasing to serve as a Director.
(d) Except for the automatic grants of Options under subparagraph (a) of
this Section 5 and the issuance of Shares of Common Stock to Directors
under Section 4 above, no Options or Shares shall otherwise be granted
hereunder, and the Board shall not have any discretion with respect to
the grant of Options or issuance of Shares of Common Stock within the
meaning of Rule 16b-3 promulgated under the Securities Exchange Act of
1934, as amended (the "Exchange Act"), or any successor rule.
<PAGE>
EXHIBIT 4.7
EXCO RESOURCES, INC.
FORM OF INCENTIVE STOCK OPTION AGREEMENT
1. Grant of Option. Pursuant to the EXCO Resources, Inc. 1998 Stock
Option Plan (the "Plan") for employees, directors, or consultants of EXCO
Resources, Inc., a Texas corporation (the "Company"), and its Subsidiaries, the
Company grants to __________________ (the "Participant") an option to purchase
from the Company a total of 300,000 full shares ("Optioned Shares") of Common
Stock ("Common Stock") of the Company at $6.00 per share (being the Fair Market
Value per share of the Common Stock on this Date of Grant, or 110% of the Fair
Market Value in the case of a 10% or more stockholder), in the amounts, during
the periods, and upon the terms and conditions set forth in this Agreement. The
Date of Grant of this Stock Option is September 15, 1998. This Stock Option is
an Incentive Stock Option.
2. Subject to Plan. The Plan is a separate legal document that contains
the general terms and conditions applicable to this Stock Option. This Stock
Option and its exercise are subject to the terms and conditions of the Plan, but
the terms of the Plan shall not be considered an enlargement of any benefits
under this Agreement. This Stock Option is subject to any rules promulgated
pursuant to the Plan by the Board or the Committee and communicated to the
Participant in writing.
3. Definitions. The capitalized terms used herein that are defined in
the Plan shall have the same meanings assigned to them in the Plan. For the
purpose of this Stock Option Agreement, "Cause" means, with respect to
Participant (i) acts of fraud or dishonesty in the course of his employment with
or service to the Company or any of its Subsidiaries, (ii) substance abuse
causing harm to the Company or any of its Subsidiaries or impairing the
Participant's performance of his regular duties, (iii) conviction of a felony
involving moral turpitude, or (iv) insubordination, dereliction of duties,
habitual absenteeism, materially deficient performance after (solely in the case
of this clause (iv)) notice to Participant and Participant's failure to correct
same within the time period specified in the notice, which time period shall be
not less than 10 business days, or (v) any event described as "cause" (or in any
other term or phrase having similar import) in any written employment agreement
between the Option Holder and the Company (or any Subsidiary).
4. Vesting; Time of Exercise. Except as specifically provided in this
Agreement and subject to certain restrictions and conditions set forth in the
Plan, this Stock Option is vested and exercisable in the following cumulative
installments:
First installment. One-fourth (1/4) of the total Optioned Shares on the
Date of Grant and until the date specified in Section 6.
Second installment. An additional one-fourth (1/4) of the total Optioned
Shares on or after the first anniversary following the Date of Grant and
until the date specified in Section 6, provided that the Participant is
still employed by the Company or one of its Subsidiaries or serving as a
director of the Company on such first anniversary.
EXCO RESOURCES, INC.
INCENTIVE STOCK OPTION AGREEMENT Page 1
<PAGE>
Third installment. An additional one-fourth (1/4) of the total Optioned
Shares on or after the second anniversary of the Date of Grant and until
the date specified in Section 6, provided that the Participant is still
employed by the Company or one of its Subsidiaries or serving as a director
of the Company on such second anniversary.
Fourth installment. An additional one-fourth (1/4) of the total Optioned
Shares on or after the third anniversary of the Date of Grant and until the
date specified in Section 6, provided that the Participant is still
employed by the Company or one of its Subsidiaries or serving as a director
of the Company on such third anniversary.
5. Acceleration of Vesting. Notwithstanding the provisions of Section 4
of this Stock Option Agreement, unvested Optioned Shares shall automatically
vest upon the occurrence of any of the following:
(a) a Change of Control in the Company; or
(b) Participant's death.
6. Term; Forfeiture. This Stock Option, and all unexercised Optioned
Shares granted to the Participant hereunder, will terminate and be forfeited at
the first of the following to occur:
(a) 5:00 p.m. on March 13, 2008;
(b) 5:00 p.m. on the date which is one hundred eighty (180) days
following the Participant's Termination of Service due to death or
Disability;
(c) 5:00 p.m. on the date which is ninety (90) days following the
Participant's Termination of Service due to Retirement; or
(d) 5:00 p.m. on the date which is ninety (90) days following the
date of any other Termination of Service of the Participant.
7. Who May Exercise. Subject to the terms and conditions set forth in
Sections 4, 5 and 6 above, during the lifetime of the Participant, this Stock
Option may be exercised only by the Participant or the Participant's guardian.
If a Termination of Service of the Participant occurs as a result of death or
Disability prior to the termination date specified in Section 6(a) hereof and
the Participant has not exercised this Stock Option as to the maximum percentage
of Optioned Shares set forth in Section 4 hereof as of the date of death or
Disability, the following persons may exercise the exercisable portion of this
Stock Option on behalf of the Participant at any time prior to the earlier of
the dates specified in Sections 6(a) or (b) hereof: (i) if the Participant is
disabled, the guardian of the Participant; or (ii) if the Participant dies, the
personal representative of his estate, or the person who acquired the right to
exercise this Stock Option by bequest or inheritance or by reason of the death
of the Participant; provided that this Stock Option shall remain subject to the
other terms of this Agreement, the Plan, and applicable laws, rules, and
regulations.
EXCO RESOURCES, INC.
INCENTIVE STOCK OPTION AGREEMENT Page 2
<PAGE>
8. No Fractional Shares. This Stock Option may be exercised only with
respect to full shares of Common Stock, and no fractional share of Common Stock
shall be issued.
9. Manner of Exercise. Subject to such administrative regulations as the
Board or the Committee may from time to time adopt, this Stock Option may be
exercised by the delivery of written notice to the Secretary of the Company
setting forth the number of shares of Common Stock with respect to which the
Stock Option is to be exercised and the date of exercise thereof (the "Exercise
Date") which shall be at least three (3) days after giving such notice unless an
earlier time shall have been mutually agreed upon. On the Exercise Date, the
Participant shall deliver to the Company consideration with a value equal to the
total Option Price of the shares to be purchased, payable as follows: (a) cash,
check, bank draft, or money order payable to the order of the Company, (b)
Common Stock (including Restricted Stock) owned by the Participant on the
Exercise Date, valued at its Fair Market Value on the Exercise Date, (c) by
delivery (including by FAX) to the Company or its designated agent of an
executed irrevocable option exercise form together with irrevocable instructions
from the Participant to a broker or dealer, reasonably acceptable to the
Company, to sell certain of the shares of Common Stock purchased upon exercise
of the Stock Option or to pledge such shares as collateral for a loan and
promptly deliver to the Company the amount of sale or loan proceeds necessary to
pay such purchase price, and/or (d) in any other form of valid consideration
that is acceptable to the Committee in its sole discretion, including a
promissory note payable to the Company in the face amount of the Option Price.
Upon payment of all amounts due from the Participant, the Company shall
cause certificates for the Optioned Shares then being purchased to be delivered
as directed by the Participant (or the person exercising the Participant's Stock
Option pursuant to Section 7) at its principal business office promptly after
the Exercise Date. The obligation of the Company to deliver shares of Common
Stock shall, however, be subject to the condition that if at any time the
Committee shall determine in its discretion that the listing, registration,
quotation or qualification of the Stock Option or the Optioned Shares upon any
securities exchange or inter-dealer quotation system or under any state or
federal law, or the consent or approval of any governmental regulatory body, is
necessary or desirable as a condition of, or in connection with, the Stock
Option or the issuance or purchase of shares of Common Stock thereunder, then
the Stock Option may not be exercised in whole or in part unless such listing,
registration, qualification, consent, or approval shall have been effected or
obtained free of any conditions not acceptable to the Committee.
If the Participant fails to pay for any of the Optioned Shares specified in
such notice or fails to accept delivery thereof, then the Participant's right to
purchase such Optioned Shares may be terminated by the Company.
10. Non-Assignability. This Stock Option is not assignable or
transferable by the Participant except (i) by will or by the laws of descent and
distribution or (ii) pursuant to the terms of a qualified domestic relations
order (as defined in Section 411(a) (13) of the Code or Section 206(d) (3) of
the Employee Retirement Income Act of 1974, as amended), provided that in the
case of an Incentive Stock Option, such transfer or assignment may occur only to
the extent it will not result in disqualifying such option as an incentive stock
option under Section 422 of the Code, or any other successor provision.
EXCO RESOURCES, INC.
INCENTIVE STOCK OPTION AGREEMENT Page 3
<PAGE>
11. Rights as Stockholder. The Participant will have no rights as a
stockholder with respect to any shares covered by this Stock Option until the
issuance of a certificate or certificates to the Participant for the shares.
Except as otherwise provided in Section 12 hereof, no adjustment shall be made
for dividends or other rights for which the record date is prior to the issuance
of such certificate or certificates.
12. Adjustment of Number of Shares and Related Matters. The number of
shares of Common Stock covered by this Stock Option, and the Option Price
thereof, shall be subject to adjustment in accordance with Articles 13, 14, and
15 of the Plan.
13. Participant's Representations. Notwithstanding any of the provisions
hereof, the Participant hereby agrees that he or she will not exercise the Stock
Option granted hereby, and that the Company will not be obligated to issue any
shares to the Participant hereunder, if the exercise thereof or the issuance of
such shares shall constitute a violation by the Participant or the Company of
any provision of any law or regulation of any governmental authority. Any
determination in this connection by the Committee shall be final, binding, and
conclusive. The obligations of the Company and the rights of the Participant
are subject to all applicable laws, rules, and regulations.
14. Investment Representation. Unless the Common Stock is issued to him
in a transaction registered under applicable federal and state securities laws,
by his or her execution hereof, the Participant represents and warrants to the
Company that all Common Stock which may be purchased hereunder will be acquired
by the Participant for investment purposes for his or her own account and not
with any intent for resale or distribution in violation of federal or state
securities laws. Unless the Common Stock is issued to him in a transaction
registered under the applicable federal and state securities laws, all
certificates issued with respect to the Common Stock shall bear an appropriate
restrictive investment legend.
15. Disqualifying Disposition. In the event that Common Stock acquired
upon exercise of a Stock Option pursuant to this Agreement is disposed of by an
Participant prior to the expiration of either two years from the Date of Grant
of such Stock Option or one year from the issuance of shares to the Participant
pursuant to the exercise of such Stock Option, such Participant shall notify the
Company in writing of the date and terms of such disposition.
16. Participant's Acknowledgments. The Participant acknowledges receipt
of a copy of the Plan, which is annexed hereto, and represents that he or she is
familiar with the terms and provisions thereof, and hereby accepts this Stock
Option subject to all the terms and provisions thereof. The Participant hereby
agrees to accept as binding, conclusive, and final all decisions or
interpretations of the Board, as that term is defined in the Plan, upon any
questions arising under the Plan or this Agreement.
17. Governing Law: Forum. This Agreement shall be governed by, construed,
and enforced in accordance with the laws of the State of Texas (excluding any
conflict of laws rule or
principle of Texas law that might refer the governance, construction, or
interpretation of this agreement to the laws of another state). The parties
agree that any proceeding regarding any dispute arising out of the subject
matter hereof shall be exclusively brought in federal or state courts sitting
EXCO RESOURCES, INC.
INCENTIVE STOCK OPTION AGREEMENT Page 4
<PAGE>
in Dallas, Texas, U.S.A., and the parties hereto irrevocably waive any objection
to such venue based on forum nonconveniens or similar principle
18. No Right to Continue Employment. Nothing herein shall be construed to
confer upon the Participant the right to continue in the employment of the
Company or any Subsidiary or interfere with or restrict in any way the right of
the Company or any Subsidiary to discharge the Participant at any time (subject
to any contract rights of the Participant).
19. Legal Construction. In the event that any one or more of the terms,
provisions, or agreements that are contained in this Agreement shall be held by
a Court of competent jurisdiction to be invalid, illegal, or unenforceable in
any respect for any reason, the invalid, illegal, or unenforceable term,
provision, or agreement shall not affect any other term, provision, or agreement
that is contained in this Agreement and this Agreement shall be construed in all
respects as if the invalid, illegal, or unenforceable term, provision, or
agreement had never been contained herein.
20. Covenants and Agreements as Independent Agreements. Each of the
covenants and agreements that is set forth in this Agreement shall be construed
as a covenant and agreement independent of any other provision of this
Agreement. The existence of any claim or cause of action of the Participant
against the Company, whether predicated on this Agreement or otherwise, shall
not constitute a defense to the enforcement by the Company of the covenants and
agreements that are set forth in this Agreement.
21. Entire Agreement. This Agreement together with the Plan supersede any
and all other prior understandings and agreements, either oral or in writing,
between the parties with respect to the subject matter hereof and constitute the
sole and only agreements between the parties with respect to the said subject
matter. All prior negotiations and agreements between the parties with respect
to the subject matter hereof are merged into this Agreement. Each party to this
Agreement acknowledges that no representations, inducements, promises, or
agreements, orally or otherwise, have been made by any party or by anyone acting
on behalf of any party, which are not embodied in this Agreement or the Plan and
that any agreement, statement or promise that is not contained in this Agreement
or the Plan shall not be valid or binding or of any force or effect.
22. Parties Bound. The terms, provisions, representations, warranties,
covenants, and agreements that are contained in this Agreement shall apply to,
be binding upon, and inure to the benefit of the parties and their respective
heirs, executors, administrators, legal representatives, and permitted
successors and assigns.
23. Modification. No change or modification of this Agreement shall be
valid or binding upon the parties unless the change or modification is in
writing and signed by the parties. Notwithstanding the preceding sentence, the
Company may amend the Plan or revoke this Stock Option to the extent permitted
in the Plan.
EXCO RESOURCES, INC.
INCENTIVE STOCK OPTION AGREEMENT Page 5
<PAGE>
24. Headings. The headings that are used in this Agreement are used for
reference and convenience purposes only and do not constitute substantive
matters to be considered in construing the terms and provisions of this
Agreement.
25. Gender and Number. Words of any gender used in this Agreement shall
be held and construed to include any other gender, and words in the singular
number shall be held to include the plural, and vice versa, unless the context
requires otherwise.
26. Notice. Any notice required or permitted to be delivered hereunder
shall be deemed to be delivered only when actually received by the Company or by
the Participant, as the case may be, at the addresses set forth below, or at
such other addresses as they have theretofore specified by written notice
delivered in accordance herewith:
(A) Notice to the Company shall be addressed and delivered as
follows:
EXCO Resources, Inc.
5735 Pineland Drive, Suite 235
Dallas, Texas 75231
Attention: T. W. Eubank
(B) Notice to the Participant shall be addressed and delivered as
follows:
EXCO RESOURCES, INC.
INCENTIVE STOCK OPTION AGREEMENT Page 6
<PAGE>
IN WITNESS WHEREOF, the Company has caused this Agreement to be executed by
its duly authorized officer, and the Participant, to evidence his or her consent
and approval of all the terms hereof, has duly executed this Agreement, as of
the date specified in Section 1 hereof.
EXCO RESOURCES, INC.
By:
Title:
Participant:
EXCO RESOURCES, INC.
INCENTIVE STOCK OPTION AGREEMENT Page 7
<PAGE>
[LETTERHEAD OF HAYNES AND BOONE, LLP APPEARS HERE]
EXHIBIT 5.1
September 25, 1998
EXCO Resources, Inc.
5735 Pineland Drive, Suite 235
Dallas, Texas 75231
Gentlemen:
We have acted as special counsel to EXCO Resources, Inc., a Texas corporation
(the "Company"), in connection with the preparation of the Registration
Statement on Form S-8 (the "Registration Statement") filed with the Securities
and Exchange Commission under the Securities Act of 1933, as amended, relating
to the registration of 1,600,000 shares of Common Stock, par value $0.02 per
share (the "Common Stock"), of the Company that may be issued pursuant to the
EXCO Resources, Inc. 1998 Stock Option Plan (the "Stock Option Plan") and the
EXCO Resources, Inc. 1998 Director Compensation Plan (collectively, the
"Plans"). The law covered by the opinions expressed herein is limited to the
Federal law of the United States and the General Corporation Law of the State of
Texas.
In connection therewith, we have examined (i) the Certificate of Incorporation
and the Bylaws of the Company; (ii) minutes and records of the corporate
proceedings of the Company with respect to the adoption of the Plans and the
granting of awards thereunder; and (iii) such other documents as we have deemed
necessary for the expression of the opinion contained herein.
In making the foregoing examination, we have assumed the genuineness of all
signatures and the authenticity of all documents submitted to us as originals,
and the conformity to original documents of all documents submitted to us as
certified or photostatic copies. Furthermore, we have assumed that the exercise
prices of all stock options that may be granted under the Stock Option Plan will
equal or exceed the par value per share of the Common Stock. As to questions of
fact material to this opinion, where such facts have not been independently
established, and as to the content and form of the Certificate of Incorporation,
Bylaws, minutes, records, resolutions and other documents or writings of the
Company, we have relied, to the extent we deem reasonably appropriate, upon
representations or certificates of officers or directors of the Company and upon
documents, records and instruments furnished to us by the Company, without
independent check or verification of their accuracy.
Based upon the foregoing, and having due regard for such legal considerations as
we deem relevant, we are of the opinion that the 1,600,000 shares of Common
Stock covered by the Registration Statement which may be issued from time to
time in accordance with the terms of the Plans have been duly authorized for
issuance by the Company, and, when so issued in accordance with the terms and
conditions of the Plans and any related option or other applicable agreements,
will be validly issued, fully paid and nonassessable.
<PAGE>
[LETTERHEAD OF HAYNES AND BOONE, LLP APPEARS HERE]
EXCO Resources, Inc.
September 25, 1998
Page 2
We hereby consent to the filing of this opinion with the Securities and Exchange
Commission as an exhibit to the Registration Statement and to the reference to
our firm under the caption, "Item 5. Interests of Named Experts and Counsel" in
the Registration Statement.
Very truly yours,
/s/ HAYNES AND BOONE, LLP
Haynes and Boone, LLP
<PAGE>
EXHIBIT 23.1
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" and to the
use of our report in the Registration Statement (Form S-8) of EXCO Resources,
Inc. for the registration of 1,600,000 shares of its common stock to be filed
with the Securities and Exchange Commission on September 25, 1998, and to the
incorporation by reference therein of our report dated March 13, 1997, except
Note 2, as to which the date is February 11, 1998 and Note 10, second paragraph,
as to which the date is March 31, 1998, with respect to the financial statements
of EXCO Resources, Inc. in its Annual Report (Form 10-K) for the year ended
December 31, 1997 filed with the Securities and Exchange Commission.
/s/ BELEW AVERITT LLP
Belew Averitt LLP
Dallas, Texas
September 25, 1998
<PAGE>
EXHIBIT 23.2
CONSENT OF INDEPENDENT AUDITORS
We consent to the reference to our firm under the caption "Experts" in the
Registration Statement (Form S-8) pertaining to the EXCO Resources, Inc. 1998
Stock Option Plan and EXCO Resources, Inc. 1998 Director Compensation Plan and
to the incorporation by reference therein of our report dated February 11, 1998
(except for the second paragraph of Note 10, as to which the date is March 31,
1998) with respect to the financial statements of EXCO Resources, Inc., and of
our report dated February 11, 1998, with respect to the statements of operating
revenues and direct operating expenses of the Maverick County Properties each of
which are included in EXCO Resources, Inc.'s Annual Report (Form 10-K) for the
year ended December 31, 1997 filed with the Securities and Exchange Commission,
and to the incorporation by reference therein of our report dated May 15, 1998,
with respect to the financial statements of Jacobi-Johnson Energy, Inc.
incorporated by reference in EXCO Resources, Inc.'s Form 8-K, as amended, filed
with the Securities and Exchange Commission on May 8, 1998 and included in the
Registration Statement (Pre-effective Amendment No. 2 to Form S-2) and related
Prospectus of EXCO Resources, Inc., for the registration of 5,943,360 shares of
its common stock, and to our report dated June 30, 1998, with respect to the
statements of operating revenues and direct operating expenses of the Dawson
County Properties incorporated by reference in EXCO Resources, Inc.'s Form 8-K
filed with the Securities and Exchange Commission on June 30, 1998 and included
in the Registration Statement (Pre-effective Amendment No. 2 to Form S-2) and
related Prospectus of EXCO Resources, Inc., for the registration of 5,943,360
shares of its common stock filed with the Securities and Exchange Commission.
/s/ Ernst & Young LLP
ERNST & YOUNG LLP
Dallas, Texas
September 25, 1998
<PAGE>
EXHIBIT 23.3
AUDITOR'S CONSENT
I consent to the incorporation by reference in the Registration
Statement (Form S-8) of EXCO Resources, Inc. dated September 24, 1998 for the
registration of 1,600,000 shares of EXCO Resources, Inc.'s common stock and the
incorporation by reference therein of my report dated March 25, 1998, with
respect to the financial statements of Gladstone Resources, Inc., included in
its Annual Report (Form 10-K) for the year ended December 31, 1997, filed with
the Securities and Exchange Commission.
/s/ Harold L. Ratcliff
------------------------------------
HAROLD L. RATCLIFF, CPA
Dallas, Texas
September 24, 1998
<PAGE>
EXHIBIT 23.5
CONSENT OF INDEPENDENT PETROLEUM ENGINEERS
Lee Keeling and Associates, Inc. ("Lee Keeling") hereby consents to
references to Lee Keeling as expert and to its reserve reports and to
information depicted in the Annual Report on Form 10-K for the year ended
December 31, 1997 for EXCO Resources, Inc., a Texas corporation, that was
derived from our reserve reports, incorporated by reference in the Prospectus
constituting a part of the Registration Statement on Form S-8 and the
Registration Statement on Form S-8 to be filed with the Securities and Exchange
Commission on or about September 25, 1998.
LEE KEELING AND ASSOCIATES, INC.
By: /s/ KENNETH RENBERG
-------------------------------
Kenneth Renberg, Vice President
Tulsa, Oklahoma
September 24, 1998
<PAGE>
EXHIBIT 23.6
CONSENT OF INDEPENDENT PETROLEUM ENGINEERS
Milmac Operating Company ("Milmac") hereby consents to references to Milmac
as expert and to its reserve reports and to information depicted in the Annual
Report on Form 10-K for the year ended December 31, 1997 for EXCO Resources,
Inc., a Texas corporation, that was derived from our reserve reports,
incorporated by reference in the Prospectus constituting a part of the
Registration Statement on Form S-8 and the Registration Statement on Form S-8 to
be filed with the Securities and Exchange Commission on or about September 25,
1998.
/s/ Milmac Operating Company
MILMAC OPERATING COMPANY
Lubbock, Texas
September 24, 1998
