Exhibit 10.10

Execution Version

PERFORMANCE GUARANTY

THIS PERFORMANCE GUARANTY (this “Guaranty”) is made as of the 9th day of May,
2010 by EXCO Resources, Inc., a corporation incorporated under the Laws of Texas
(the “Guarantor”), in favor of BG US Production Company, LLC, a limited
liability company formed under the Laws of Delaware (“BG”). Guarantor and BG are
referred to herein individually as a “Party” and collectively as the “Parties”.

RECITALS

WHEREAS, BG and EXCO Holding (PA), Inc., a corporation incorporated under the
Laws of Delaware (“EXCO”) desire to enter into an arrangement for the joint
exploration, development and operation of certain oil and gas properties located
in the States of Kentucky, New York, Ohio, Pennsylvania, Tennessee, Virginia and
West Virginia, and in connection therewith, EXCO and BG have entered into a
Membership Interest Transfer Agreement dated of even date herewith (as hereafter
amended, supplemented or modified, the “MITA”); and

WHEREAS, as a material inducement to BG to enter into the MITA with EXCO,
Guarantor has agreed to provide a guaranty of certain obligations of EXCO under
the MITA.

AGREEMENT

NOW, THEREFORE, for and in consideration of the mutual promises contained
herein, and for other good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged and confessed, the Parties hereby
agree as follows:

Section 1. Guaranty. Guarantor hereby absolutely, unconditionally and
irrevocably guarantees to BG and its successors, permitted transferees and
permitted assigns the full performance when due of all obligations of EXCO or
any of its Affiliates (collectively, the “Subject Persons”) under the terms of
the MITA (collectively, with any increases, extensions, or rearrangements of
such obligations, the “Guaranteed Obligations”). The guaranty set forth in this
Section 1 is a continuing guaranty of performance and payment and not a guaranty
of collection.

Section 2. Primary Liability of Guarantor. Guarantor shall be liable for the
payment of the Guaranteed Obligations, as set forth in this Guaranty, as a
primary obligor, and not as a mere surety.

In the event of default by any Subject Person in the performance of the
Guaranteed Obligations, or any part thereof, when performance becomes due,
Guarantor shall, on demand and without further notice of nonperformance, or any
other notice whatsoever, perform, or, at its election, immediately cause the
performance of such Guaranteed Obligation, and it shall not be necessary for BG,
in order to enforce such performance by Guarantor, to institute any

 

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suit or pursue or exhaust any rights or remedies against any Subject Person or
others liable for such performance, or to join any Subject Person for the
performance of the Guaranteed Obligations or any part thereof in any action to
enforce this Guaranty, or to resort to any other means of obtaining performance
of the Guaranteed Obligations.

Suit may be brought or demand may be made against any Subject Person or
Guarantor or against any one or more of them, separately or together, without
impairing the rights of BG against either.

Section 3. Certain Agreements and Waivers by Guarantor. Guarantor hereby agrees
that BG’s rights or remedies and all of Guarantor’s obligations under the terms
of this Guaranty shall remain in full force and effect and shall not be
released, diminished, impaired, reduced or affected by, or deemed to be
satisfied by, nor shall Guarantor be exonerated, discharged or released (by
virtue of any Law, arrangement or relationship) by, any one or more of the
following events, actions, facts, or circumstances, and the liability of
Guarantor under this Guaranty shall be absolute and unconditional irrespective
of:

 

  (a) the taking or accepting of any other security or guaranty for, or right of
recourse with respect to, any or all of the Guaranteed Obligations;

 

  (b) whether express or by operation of any Law or otherwise, any complete or
partial release of any Subject Person or any other party liable, directly or
indirectly, for the performance of any or all of the Guaranteed Obligations, or
any limitation, discharge, cessation or partial release of the liability of
Guarantor hereunder (other than discharge or release under the express
provisions of this Guarantee, including by virtue of satisfaction of Guaranteed
Obligations, under the express terms of the MITA, or by agreement of BG), or;

 

  (c) the bankruptcy, insolvency, dissolution, liquidation, termination,
receivership, reorganization, merger, consolidation, change of form, structure
or ownership, sale of all assets, or lack of corporate, partnership or other
power of any Subject Person or any other party at any time liable for the
performance of any or all of the Guaranteed Obligations;

 

  (d) either with or without notice to or consent of Guarantor, any renewal,
extension, modification, amendment, supplement, subordination or rearrangement
of the terms of any or all of the Guaranteed Obligations, including material
alterations of the terms of performance or any other terms thereof, or any
waiver, termination, or release of, or consent to departure from, the MITA or
any adjustment, indulgence, forbearance, or compromise that may be granted from
time to time by BG to any Subject Person, Guarantor, and/or any other Person at
any time liable for the performance of any or all of the Guaranteed Obligations;

 

  (e) any neglect, lack of diligence, delay, omission, failure, or refusal of BG
to take or prosecute (or in taking or prosecuting) any action for the collection
of any of the Guaranteed Obligations;

 

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  (f) if for any reason BG is required to refund any payment by any Subject
Person or any other party liable for the performance of any or all of the
Guaranteed Obligations or pay the amount thereof to someone else;

 

  (g) the existence of any claim, set-off, or other right that Guarantor may at
any time have against any Subject Person, BG, or any other Person, whether or
not arising in connection with this Guaranty or the MITA;

 

  (h) any order, ruling or plan of reorganization emanating from proceedings
under Title 11 of the United States Code with respect to any Subject Person or
any other Person, including any extension, reduction, composition, or other
alteration of the Guaranteed Obligations, whether or not consented to by BG;

 

  (i) any absence of any notice to, or knowledge by, Guarantor, of the existence
or occurrence of any of the matters or events set forth in the foregoing
subsections (a) through (h);

 

  (j) the failure to provide any notices or demands, whether of presentment,
protest, dishonor or otherwise, other than (i) any notices and demands expressly
set forth herein, and (ii) such notices or demands as may be required by
applicable Law which cannot be waived; or

 

  (k) any other circumstance that might otherwise constitute a defense available
to, or a discharge of, a guarantor (except discharge or defenses under the
express provisions of this Guarantee, including by virtue of satisfaction of
Guaranteed Obligations, under the express terms of the MITA, or by other
agreement of BG).

In the event any performance by any Subject Person or any other Person to BG in
respect of the Guaranteed Obligations is held to constitute a preference,
fraudulent transfer or other voidable performance under any bankruptcy,
insolvency or similar Law, or if for any other reason, BG is required to refund
any payment or pay the amount thereof to any other party, such performance by
such Subject Person or such other Person to BG shall not constitute a release of
Guarantor from any liability hereunder, and this Guaranty shall continue to be
effective or shall be reinstated (notwithstanding any prior release, surrender
or discharge by BG of this Guaranty or of Guarantor), as the case may be, with
respect to, and this Guaranty shall apply to, any and all amounts so refunded by
BG or paid by BG to another Person (which amounts shall constitute part of the
Guaranteed Obligations), and any interest paid by BG and any attorneys’ fees,
costs and expenses paid or incurred by BG in connection with any such event.

 

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In addition to the other matters set forth in this Section 3, until all
Guaranteed Obligations have been performed in full, Guarantor hereby agrees not
to assert any claim of subrogation with respect to the Guaranteed Obligations,
or any right of contribution, reimbursement, indemnification or other rights of
recovery against the Subject Persons in respect of the Guaranteed Obligations,
provided that nothing herein shall prevent transfers of funds between the
Subject Persons and Guarantor in the ordinary course of business. If any amount
shall be paid to Guarantor in violation of the preceding sentence, such amount
shall be held in trust for the benefit of BG and immediately turned over to BG,
with any necessary endorsement, to be applied to the Guaranteed Obligations.

Guarantor agrees that, as between Guarantor and BG as of any time, the
Guaranteed Obligations accrued as of such time may be declared to be due for
purposes of Section 1 notwithstanding any stay, injunction or other prohibition
preventing such declaration as against any Subject Person and that, in the event
of such declaration, such Guaranteed Obligations (whether or not due by any
Subject Person) shall forthwith become due by Guarantor for purposes of
Section 1.

Each failure by any Subject Person to perform any Guaranteed Obligations shall
give rise to a separate cause of action herewith, and separate suits may be
brought hereunder as each cause of action arises.

Section 4. Representations and Warranties of Guarantor. Guarantor represents and
warrants to BG as follows:

 

  (a) Organization. Guarantor is a corporation incorporated under the Laws of
Texas and has all requisite corporate power and authority to carry on its
business as is now being conducted except for such failures which would not,
individually or in the aggregate, have a material adverse effect on the ability
of Guarantor to discharge its obligations under this Guaranty (a “Guarantor
Material Adverse Effect”).

 

  (b) Authority Relative to this Guaranty. Guarantor has all necessary corporate
power and authority to execute and deliver this Guaranty and to perform its
obligations hereunder. The execution and delivery by Guarantor of this Guaranty
and performance by Guarantor of its obligations hereunder have been duly and
validly authorized by all necessary corporate action on the part of Guarantor.

 

  (c) Enforceability. This Guaranty constitutes a valid and binding agreement of
Guarantor, enforceable against Guarantor in accordance with its terms, subject
to (i) applicable bankruptcy, insolvency, reorganization, moratorium and other
similar Laws of general application with respect to creditors and (ii) general
principles of equity.

 

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  (d) Consents and Approvals; No Violation.

(i) Neither the execution and delivery of this Guaranty by Guarantor nor
performance by Guarantor of its obligations hereunder will (A) conflict with or
result in any breach of any provision of the organizational or governing
documents or instruments of Guarantor, (B) result in a default (or give rise to
any right of termination, cancellation or acceleration) under any of the terms,
conditions or provisions of any note, bond, mortgage, indenture, license,
agreement, lease or other instrument or obligation to which Guarantor or any of
its Affiliates is party or by which any of their respective assets may be bound
or (C) violate any Law applicable to Guarantor, or any of its assets, except in
case of clauses (B) and (C), for such failure to obtain a necessary consent,
defaults and violations, which would not, individually or in the aggregate, have
a Guarantor Material Adverse Effect.

(ii) No declaration, filing or registration with, or notice to, or
authorization, consent or approval of any Person or Governmental Authority is
necessary for performance by Guarantor of its obligations hereunder, other than
such declarations, filings, registrations, notices, authorizations, consents or
approvals which, if not obtained or made would not, individually or in the
aggregate, have a Guarantor Material Adverse Effect.

 

  (e) Taxes. Any payments made under this Guaranty by Parent in the performance
of any Guaranteed Obligation to any Subject Person shall not be subject to any
deduction or withholding whatsoever, including for any and all present and
future taxes.

Section 5. Assignment. This Guaranty may not be assigned by any Party, in whole
or in part, without the prior written consent of the other Parties.

 

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Section 6. Notices. All notices and communications required or permitted to be
given hereunder shall be in writing and shall be delivered personally, or sent
by bonded overnight courier, or mailed by U.S. Express Mail or by certified or
registered United States Mail with all postage fully prepaid, or sent by telex
or facsimile transmission (provided any such telex or facsimile transmission is
confirmed either orally or by written confirmation), addressed to the
appropriate Party at the address for such Party shown below or at such other
address as such Party shall have theretofore designated by written notice
delivered to the Party giving such notice:

If to Guarantor:

EXCO Resources, Inc.

12377 Merit Drive, Suite 1700

Dallas, Texas 75251

Attention: Rick Hodges, Vice President of Land

Telephone: (214) 368-2084

Fax: (214) 706-3424

With a copy to:

EXCO Resources, Inc.

12377 Merit Drive, Suite 1700

Dallas, Texas 75251

Attention: William L. Boeing, Vice President, General Counsel,

and Secretary

Telephone: (214) 368-2084

Fax: (214) 706-3409

With a copy to:

Vinson & Elkins L.L.P.

1001 Fannin Street, Suite 2500

Houston, Texas 77002-6760

Attention: Stephen C. Szalkowski

Telephone: (713) 758-2312

Fax: (713) 615-5084

If to BG:

BG US Production Company, LLC

5444 Westheimer, Suite 1775

Houston, Texas 77056

Attention: Jon Harris, Asset General Manager

Telephone: (713) 599-4000

Fax: (713) 599-4002

 

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With a copy to:

BG North America, LLC

5444 Westheimer, Suite 1775

Houston, Texas 77056

Attention: Chris Migura

Telephone: (713) 599-3826

Fax: (713) 403-3781

With a copy to:

Morgan, Lewis & Bockius

1000 Louisiana Street, Suite 4200

Houston, Texas 77002

Attention: David F. Asmus

Telephone: (713) 890-5718

Fax: (713) 890-5001

Any notice given in accordance herewith shall be deemed to have been given when
delivered to the addressee in person, or by courier, or transmitted by facsimile
transmission during normal business hours, or upon actual receipt by the
addressee after such notice has either been delivered to an overnight courier or
deposited in the United States Mail, as the case may be. The Parties may change
the address, telephone numbers, and facsimile numbers to which such
communications are to be addressed by giving written notice to the other Parties
in the manner provided in this Section 6.

Section 7. Further Cooperation. Guarantor at Guarantor’s expense will promptly
execute and deliver to BG upon BG’s request all such other and further
documents, agreements, and instruments in compliance with or accomplishment of
the agreements of Guarantor under this Guaranty.

Section 8. Entire Agreement. THIS GUARANTY CONSTITUTES THE ENTIRE AGREEMENT
BETWEEN GUARANTOR AND BG PERTAINING TO THE SUBJECT MATTER HEREOF AND SUPERSEDES
ALL PRIOR AGREEMENTS, UNDERSTANDINGS, NEGOTIATIONS, AND DISCUSSIONS, WHETHER
ORAL OR WRITTEN, OF THE PARTIES PERTAINING TO THE SUBJECT MATTER HEREOF. THERE
ARE NO WARRANTIES, REPRESENTATIONS, OR OTHER AGREEMENTS BETWEEN GUARANTOR OR BG
RELATING TO THE SUBJECT MATTER HEREOF EXCEPT AS SPECIFICALLY SET FORTH IN THIS
GUARANTY OR THE MITA, AND NEITHER GUARANTOR NOR BG SHALL BE BOUND BY OR LIABLE
FOR ANY ALLEGED REPRESENTATION, PROMISE, INDUCEMENT, OR STATEMENTS OF INTENTION
NOT SO SET FORTH.

 

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Section 9. Parties in Interest. Notwithstanding anything contained in this
Guaranty to the contrary, nothing in this Guaranty, expressed or implied, is
intended to confer on any Person other than the Parties any rights, remedies,
obligations or liabilities under or by reason of this Guaranty.

Section 10. Amendment. This Guaranty may be amended only by an instrument in
writing executed by the Parties against whom enforcement is sought.

Section 11. Waiver; Rights Cumulative. Any of the terms, covenants,
representations, warranties, or conditions hereof may be waived only by a
written instrument executed by or on behalf of the Party waiving compliance. No
course of dealing on the part of Guarantor or BG, or their respective officers,
employees, agents, or representatives, nor any failure by Guarantor or BG to
exercise any of their rights under this Guaranty shall operate as a waiver
thereof or affect in any way the right of such Party at a later time to enforce
the performance of such provision. No waiver by any Party of any condition, or
any breach of any term, covenant, representation, or warranty contained in this
Guaranty, in any one or more instances, shall be deemed to be or construed as a
further or continuing waiver of any such condition or breach or a waiver of any
other condition or of any breach of any other term, covenant, representation, or
warranty. The rights of Guarantor and BG under this Guaranty shall be
cumulative, and the exercise or partial exercise of any such right shall not
preclude the exercise of any other right.

Section 12. Governing Law; Jury Waiver. THIS GUARANTY AND THE LEGAL RELATIONS
AMONG THE PARTIES SHALL BE GOVERNED AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF
THE STATE OF NEW YORK, EXCLUDING ANY CONFLICTS OF LAW RULE OR PRINCIPLE THAT
MIGHT REFER CONSTRUCTION OF SUCH PROVISIONS TO THE LAWS OF ANOTHER JURISDICTION.
SUBJECT TO SECTION 13, ALL OF THE PARTIES HERETO CONSENT TO THE EXERCISE OF
JURISDICTION IN PERSONAM BY THE COURTS OF THE STATE OF TEXAS FOR ANY DISPUTE.
EACH PARTY HERETO WAIVES, TO THE FULLEST EXTENT PERMITTED BY APPLICABLE LAW, ANY
RIGHT IT MAY HAVE TO A TRIAL BY JURY IN RESPECT OF ANY DISPUTE.

Section 13. Arbitration. Any dispute among the Parties with respect to this
Guaranty shall be resolved through final and binding arbitration in accordance
with the arbitration procedures set out in Section 15.16 of the MITA, which
shall apply mutatis mutandis to any such dispute. Any papers, notices, or
process necessary or proper for an arbitration hereunder, or any court action in
connection with an arbitration or an award, may be served on a Party in the
manner set forth in Section 6 above.

Section 14. Payments. All sums payable as Guaranteed Obligations under this
Guaranty shall be paid within fifteen (15) Business Days after BG’s demand for
payment is received, in immediately available funds in lawful money of the
United States of America that at the time of payment is legal tender for the
payment of public and private debts.

 

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Section 15. Severability. If any term or other provision of this Guaranty is
invalid, illegal, or incapable of being enforced by any rule of Law or public
policy, all other conditions and provisions of this Guaranty 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 adverse manner to
any Party. Upon such determination that any term or other provision is invalid,
illegal, or incapable of being enforced, the Parties shall negotiate in good
faith to modify this Guaranty so as to effect the original intent of the Parties
as closely as possible in an acceptable manner to the end that the transactions
contemplated hereby are fulfilled to the extent possible.

Section 16. Counterparts. This Guaranty may be executed in any number of
counterparts, and each such counterpart hereof shall be deemed to be an original
instrument, but all of such counterparts shall constitute for all purposes one
agreement. Any signature hereto delivered by a Party by facsimile transmission
or by e-mail of a PDF file shall be deemed an original signature hereto,
provided that any facsimile or e-mail transmission of a signature page delivered
by a Party shall be followed promptly by an original signature page.

Section 17. Scope. Subject only to Section 3, this Guaranty creates for
Guarantor no more rights and imposes on Guarantor no more obligations and duties
with respect to the performance of the Guaranteed Obligations than Guarantor
would have if it had executed the MITA in the place of EXCO.

Section 18. References and Rules of Construction. Unless otherwise indicated,
capitalized terms used but not otherwise defined herein and defined in the MITA
shall have the meanings given such terms in the MITA. All references in this
Guaranty to Sections, subsections and other subdivisions refer to the
corresponding Sections, subsections and other subdivisions of or to this
Guaranty unless expressly provided otherwise. Titles appearing at the beginning
of any Sections, subsections and other subdivisions of this Guaranty are for
convenience only, do not constitute any part of this Guaranty, and shall be
disregarded in construing the language hereof. The words “this Guaranty,”
“herein,” “hereby,” “hereunder” and “hereof,” and words of similar import, refer
to this Guaranty as a whole and not to any particular Section, subsection or
other subdivision unless expressly so limited. The words “this Section,” and
“this subsection,” and words of similar import, refer only to the Section or
subsection hereof in which such words occur. The word “including” (in its
various forms) means “including without limitation”. All references to “$” or
“dollars” shall be deemed references to United States dollars. Each accounting
term not defined herein will have the meaning given to it under GAAP as
interpreted as of the date of this Guaranty. Pronouns in masculine, feminine or
neuter genders shall be construed to state and include any other gender, and
words, terms and titles (including terms defined herein) in the singular form
shall be construed to include the plural and vice versa, unless the context
otherwise requires.

[Signature Pages Follow]

 

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IN WITNESS WHEREOF, the Parties have duly executed this Guaranty as of the day
and year first above set forth.

 

GUARANTOR: EXCO RESOURCES, INC. By:  

/s/ DOUGLAS H. MILLER

Name:   Douglas H. Miller Title:   Chief Executive Officer BG: BG US PRODUCTION
COMPANY, LLC By:  

/s/ MARTIN HOUSTON

Name:   Martin Houston Title:   President