Exhibit 10.4
EXCO Resources,
Inc.
12377 Merit Drive, Suite
1700
Dallas, TX 75251
March 28, 2007
Ares Corporate Opportunities Fund,
L.P.
ACOF EXCO, L.P.
ACOF EXCO 892 Investors,
L.P.
Ares Corporate Opportunities Fund
II, L.P.
Ares EXCO, L.P.
Ares EXCO 892 Investors,
L.P.
c/o Ares Management LLC
1999 Avenue of the Stars, Suite
1900
Los Angeles, California
90067
Re:
Nomination of Designee to the Board
of Directors
Ladies and Gentlemen:
Reference is hereby made to that
certain Preferred Stock Purchase Agreement (the “ Purchase
Agreement ”), dated as of the date hereof, by and among
EXCO Resources, Inc. (“ EXCO ”) and the
Purchasers named therein. All capitalized terms used but not
otherwise defined herein shall have the respective meanings set
forth in the Purchase Agreement. For purposes of this letter,
“ Ares ” means, collectively, Ares Corporate
Opportunities Fund, L.P. (“ ACOF ”), ACOF EXCO,
L.P. (“ ACOF EXCO ”), ACOF EXCO 892 Investors,
L.P. (“ ACOF 892 ”), Ares Corporate
Opportunities Fund II, L.P. (“ ACOF II ”),
Ares EXCO, L.P. (“ Ares EXCO ”), Ares EXCO 892
Investors, L.P. (“ Ares 892 ”) and any other
investment fund or account, whether now in existence or hereafter
formed, which is managed or controlled by Ares Management LLC
(“ Ares Management ”) or any of its affiliates
(as such term is defined in Rule 12b-2 of the Securities Exchange
Act of 1934, as amended, and the rules and regulations promulgated
thereunder), or of which Ares Management or any of its affiliates
is an advisor.
This is the letter referred to in
Section 2.04(d) of the Purchase Agreement. EXCO hereby agrees,
subject to the fiduciary duties of its board of directors, for the
benefit of ACOF, ACOF EXCO, ACOF 892, ACOF II, Ares EXCO and Ares
892 that following such time when: (i) Ares ceases to have the
right to elect a director to serve on the Board of Directors
pursuant to Section 5(c) of the Series C 7.0% Preferred
Statement of Designation and (ii) there ceases to be twenty-five
percent (25%) or more of the Initial Preferred Shares (as defined
in the Statements of Designation) outstand
