Exhibit
10.1


SECOND
AMENDED AND RESTATED


EXCO
RESOURCES, INC.


SEVERANCE
PLAN


(EFFECTIVE
AS OF NOVEMBER 8, 2006)


 















 


TABLE OF
CONTENTS


	
  Section

  	
   

  	
  Page

  
	
   

  	
   

  
	
  ONE  PURPOSE OF PLAN

  	
  1

  
	
  TWO  PRIOR SEVERANCE ARRANGEMENTS

  	
  1

  
	
  THREE  DEFINITIONS

  	
  1

  
	
  FOUR  ELIGIBILITY AND SEVERANCE PAY
  BENEFITS

  	
  5

  
	
  4.1

  	
  Eligibility

  	
  5

  
	
  4.2

  	
  Release Form

  	
  5

  
	
  4.3

  	
  Termination of Eligibility for Severance Pay

  	
  5

  
	
  4.4

  	
  Severance Pay

  	
  5

  
	
  FIVE  FUNDING

  	
  6

  
	
  SIX  CLAIMS PROCEDURE

  	
  6

  
	
  6.1

  	
  Filing and Initial Determination of Claim

  	
  6

  
	
  6.2

  	
  Duty of Plan Administrator Upon Denial of Claim

  	
  6

  
	
  6.3

  	
  Request for Review of Claim Denial

  	
  6

  
	
  6.4

  	
  Decision on Review of Denial

  	
  7

  
	
  SEVEN  ADMINISTRATION OF THE PLAN

  	
  7

  
	
  7.1

  	
  Plan Administrator

  	
  7

  
	
  7.2

  	
  Responsibilities

  	
  7

  
	
  7.3

  	
  Allocation and Delegation of Plan Administrator
  Responsibilities

  	
  7

  
	
  7.4

  	
  Actions of Fiduciaries

  	
  8

  
	
  7.5

  	
  General Administrative Powers

  	
  8

  
	
  7.6

  	
  Appointment of Professional Assistance

  	
  9

  
	
  7.7

  	
  Discretionary Acts

  	
  9

  
	
  7.8

  	
  Responsibility of Fiduciaries

  	
  9

  
	
  7.9

  	
  Indemnity by Employer

  	
  9

  
	
  EIGHT  ADOPTION OF PLAN BY SUBSIDIARY

  	
  9

  
	
  NINE  AMENDMENT OF THE PLAN

  	
  10

  
	
  TEN  TERMINATION OF THE PLAN

  	
  10

  
	
  ELEVEN  VESTING

  	
  10

  
	
  TWELVE  STATUS OF EMPLOYMENT RELATIONS

  	
  10

  
	
  THIRTEEN  RESTRICTIONS ON ASSIGNMENT

  	
  11

  
	
  FOURTEEN  APPLICABLE LAW

  	
  11

  
	
  FIFTEEN  INTERPRETATION OF THE PLAN

  	
  11

  



 



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SECOND AMENDED AND RESTATED


EXCO RESOURCES, INC.


SEVERANCE PLAN


EXCO RESOURCES, INC. (the “Company”) is amending and
restating its severance plan, originally adopted on August 15, 2002 and amended
and restated as of August 17, 2004, and further amended and restated as of
November 8, 2006 (the “Effective Date”), in accordance with the terms and
conditions contained herein.  The amended
and restated severance plan adopted on August 17, 2004, is replaced in its
entirety with this Second Amended and Restated EXCO Resources, Inc. Severance
Plan (the “Plan”) and no provision of the August 17, 2004, plan shall
survive.


SECTION ONE


PURPOSE OF PLAN


The purpose of the Plan is to provide financial
support to Eligible Employees who incur a Termination of Employment due to a
Change of Control.


SECTION TWO


PRIOR SEVERANCE ARRANGEMENTS


As of the Effective Date, the Plan replaces any and
all severance pay obligations, plans, policies, practices, arrangements or
programs, written or unwritten, under which the Eligible Employees may
otherwise be eligible for severance benefit payments.  Notwithstanding the foregoing provisions of
this Section Two, nothing in this Plan shall adversely affect the rights an
individual Eligible Employee may have to severance payments under any written
agreement executed by and between the Employer and that Eligible Employee (a “Severance
Agreement”); provided, however, that in the event any Eligible Employee that is
a party to a Severance Agreement suffers a Termination of Employment and is
entitled to and is receiving the severance benefits intended to be provided
under his or her Severance Agreement, such Eligible Employee shall not be
entitled to receive severance benefits pursuant to this Plan.


SECTION THREE


DEFINITIONS


As used in the Plan:


3.1           “Base
Pay” shall mean the Eligible Employee’s gross annual salary or wages before any
deductions, exclusions or any deferrals or contributions under any Company plan
or program, but excluding overtime, bonuses, incentive compensation, shift and
lead premium payments, employee benefits or any other form of compensation,
being received by an Eligible Employee immediately prior to employment
termination.  The Base Pay for an
Eligible Employee paid on an hourly basis shall be the individual’s hourly pay
rate in effect immediately prior to the sale multiplied by 40 hours per week
and multiplied by 52 weeks.









 



3.2           “Cause”
shall mean (i) the willful breach or habitual neglect of assigned duties
related to the Company, including compliance with Company policies; (ii) conviction
(including any plea of nolo contendere) of the Eligible Employee of any felony
or crime involving dishonesty or moral turpitude; (iii) any act of personal
dishonesty knowingly taken by the Eligible Employee in connection with his
responsibilities as an employee and intended to result in personal enrichment
of the Eligible Employee or any other person; (iv) bad faith conduct that is
materially detrimental to the Company; (v) inability of the Eligible Employee
to perform the Employee’s duties due to alcohol or illegal drug use; (vi) the
Eligible Employee’s failure to comply with any legal written directive of the
Board of Directors of the Company; (vii) any act or omission of the Eligible
Employee which is of substantial detriment to the Company because of the
Eligible Employee’s intentional failure to comply with any statute, rule or
regulation, except any act or omission believed by the Eligible Employee in
good faith to have been in or not opposed to the best interest of the Company
(without intent of the Eligible Employee to gain, directly or indirectly, a
profit to which the Eligible Employee was not legally entitled) and except that
Cause shall not mean bad judgment or negligence other than habitual neglect of
duty; or (viii) any other act or failure to act or other conduct which is
determined by the Plan Administrator, in its sole discretion, to be
demonstrably and materially injurious to the Employer, monetarily or otherwise.


3.3           “Change
of Control” shall mean


(i)            the Company is merged or consolidated into or
with another entity, and as a result of such merger or consolidation less than
a majority of the combined voting power of the then-outstanding securities of
such entity immediately after such transaction is held by the holders of Voting
Stock of the Company immediately prior to such transaction;


(ii)           the Company sells or otherwise transfers all or substantially all of
its assets to any person or entity, and less than a majority of the combined
voting power of the then-outstanding
securities of such person or entity immediately after such sale or transfer is
held by the holders of Voting Stock of the Company immediately prior to such
sale or transfer; or


(iii)          any “person” (as such term is used in Sections 13(d) and 14(d) of the
Exchange Act) is or becomes the beneficial owner (as defined in Rules 13d-3 and
13d-5 under the Exchange Act, except that for purposes of this clause (iii)
such person shall be deemed to have “beneficial ownership” of all shares that
any such person has the right to acquire, whether such right is exercisable
immediately or only after the passage of time, directly or indirectly, of more
than 50% of the total voting power of the Voting Stock of the Company; or


(iv)          individuals who on the Effective Date constituted the Board of
Directors of the Company (together with any new directors whose election by
such Board of Directors of the Company or whose nomination for election by the
shareholders of the Company was approved by a vote of 66-2/3% of the directors
of the Company then still in office who were either directors on the Effective
Date or whose election or nomination for election was previously so approved)
cease for any reason to constitute a majority of the Board of Directors of the
Company then in office; or


(v)           the adoption of a plan relating to the liquidation or dissolution of
the Company.


Provided, however, that in
the event any subsidiary of the Company is spun off by means of a rights
offering to the Company’s shareholders or an underwritten public offering, or
any



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combination thereof, even
where less than a majority of the voting equity ownership is retained by the
Company, shall not in any event constitute a Change of Control.


3.4           “Company”
shall mean EXCO Resources, Inc.


3.5           “Comparable
Offer of Employment” shall mean:


(i)            that the proposed compensation and benefits,
in the aggregate, to be paid by the Company or any successor to the Company by
merger or acquisition of all or substantially all of the Company’s assets,
offering employment are commensurate with the compensation and benefits
previously paid by the Company, in the aggregate, to such Eligible Employee;


(ii)           the Eligible Employee incurs no demotion in his or her position with
the Employer from the position the Eligible Employee held immediately prior to
the effective date of the Change of Control;


(iii)          the Eligible Employee incurs no significant adverse change in the
nature or scope of the authorities, powers, functions, responsibilities or
duties attached to the position or positions with the Employer which the
Eligible Employee held immediately prior to the effective date of the Change of
Control, without the prior written consent of the Eligible Employee, which is
not remedied within ten (10) calendar days after receipt by the Employer of
written notice from the Eligible Employee of such change; and


(iv)          the Eligible Employee’s principal place of work has not changed to any
location that is more than thirty-five (35) miles from his or her principal
place of work immediately prior to the effective date of the Change of Control,
without the prior written consent of the Eligible Employee.


3.6           “Eligible
Employee” shall mean any employee employed by the Company or any subsidiary of
the Company as a regular, full-time employee on the effective date of a Change
of Control and who incurs a Termination of Employment due to a Change of
Control either on the date of the Change of Control or within the six-month
period immediately following the effective date of the Change of Control and
such Termination of Employment was not for Cause.


3.7           “Employer”
shall mean the Company and any direct or indirect United States subsidiary of
the Company which adopts the Plan, and any successor to either the Company or
any direct or indirect United States subsidiary of the Company which adopted
this Plan.


3.8           “ERISA”
shall mean the Employee Retirement Income Security Act of 1974, as amended from
time to time.  References to any Section
of ERISA shall include any successor provision thereto.


3.9           “Exchange
Act” shall mean the Federal Securities Exchange Act of 1934, as amended from
time to time.


3.10         “Good
Reason” shall mean any of the following events that occur either on the
effective date of a Change of Control or within the six-month period
immediately following the effective date of a Change of Control:



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(i)            the Eligible Employee incurs a demotion in
his or her position with the Employer from the position the Eligible Employee
held immediately prior to the effective date of the Change of Control;


(ii)           the Eligible Employee incurs a reduction in his or her Base Pay from
his or her Base Pay immediately prior to the effective date of a Change of
Control;


(iii)          the Eligible Employee incurs a significant adverse change in the nature
or scope of the authorities, powers, functions, responsibilities or duties
attached to the position or positions with the Employer which the Eligible
Employee held immediately prior to the effective date of the Change of Control,
without the prior written consent of the Eligible Employee, which is not remedied
within ten (10) calendar days after receipt by the Employer of written notice
from the Eligible Employee of such change; or


(iv)          the Eligible Employee’s principal place of work changed to any location
that is more than thirty-five (35) miles from his or her principal place of
work immediately prior to the effective date of the Change of Control, without
the prior written consent of the Eligible Employee.


3.11         “Internal
Revenue Code” shall mean the Internal Revenue Code of 1986, as amended from
time to time.  References to any Section
of the Internal Revenue Code shall include any successor provision thereto.


3.12         “Plan”
shall mean the Second Amended and Restated EXCO Resources, Inc. Severance Plan
as set forth in this document, and as hereafter amended.


3.13         “Plan
Administrator” shall mean the person, persons or entity administering the Plan
in accordance with the provisions of Section Seven hereof.  The Plan Administrator shall be the “named
fiduciary,” as referred to in Section 402(a) of ERISA, with respect to the
management, operation and administration of the Plan.


3.14         “Plan
Year” shall mean an initial period starting on the Effective Date and ending on
December 31, 2006, and thereafter the twelve (12)-month period ending on
each December 31.


3.15         “Release
Form” shall mean a release agreement which is to be signed by the Eligible
Employee releasing any and all claims against the Employer and which is in such
form as approved by the Company.


3.16         “Severance
Pay” shall mean an amount equal to an Eligible Employee’s Base Pay.


3.17          “Termination
of Employment” shall mean a termination of employment from the Employer which
results from an affirmative discharge from employment by the Employer, other
than discharge for Cause.  An Eligible
Employee who voluntarily terminates employment for Good Reason shall be deemed
to have incurred a Termination of Employment. 
An Eligible Employee shall not be deemed to have incurred a Termination
of Employment by reason of the transfer of the Eligible Employee’s employment
between the Company and any subsidiary or among subsidiaries (or among any
department or business unit of the Company). 
The Plan Administrator shall determine, in its sole discretion, whether
an Eligible Employee’s termination of employment from the Employer constitutes
a “Termination of Employment.”



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3.18         “Voting
Stock” shall mean shares of the Company’s Common Stock, par value $0.001 per
share, and any other securities of the Company entitled to vote for the
election of directors.


3.19         Wherever
appropriate, words used in the Plan in the singular may mean the plural, the
plural may mean the singular, and the masculine may mean the feminine.


SECTION FOUR


ELIGIBILITY AND SEVERANCE PAY BENEFITS


4.1           Eligibility.  Subject to Sections 4.3 and
4.4 of this Plan, any Eligible Employee is eligible for Severance Pay following
his or her Termination of Employment if such Termination of Employment occurs
either on the effective date of a Change of Control or within the six-month
period immediately following the effective date of a Change of Control,
provided that such Eligible Employee executes a Release Form pursuant to
Section 4.2 of this Plan.


4.2           Release Form.  An
Eligible Employee otherwise eligible for Severance Pay under this Plan shall be
paid such Severance Pay only if the Eligible Employee executes and files the
appropriate fully completed and executed Release Form (substantially in the
form of Exhibit A-1 or Exhibit A-2, as the case may be, attached hereto) with
the Plan Administrator, in accordance with the instructions and on or before
the date specified on the Release Form or any document accompanying the Release
Form, and in the case of an Eligible Employee age 40 or over, does not revoke
the Release Form within seven (7) days of executing the Release Form.


4.3           Termination of Eligibility for Severance Pay.  An
Eligible Employee will cease to be eligible to receive Severance Pay, under
this Plan upon the earlier of the following:


(a)                                  the Eligible Employee’s death, unless it
occurs after the date the Release Form is executed;


(b)                                 the Eligible Employee’s discharge for Cause
or misconduct;


(c)                                  the Eligible Employee’s failure to execute
and file the Release Form by the date specified on the Form;


(d)                                 the Eligible Employee’s receipt of a
Comparable Offer of Employment from any other operation of the Company or any
of its affiliate organizations, regardless of whether such Eligible Employee
accepts such offer; or


(e)                                  the Eligible Employee’s receipt and
acceptance of a transfer of employment to any other operation of the Company or
any of its affiliate organizations.


4.4           Severance Pay. The Severance Pay to which an Eligible
Employee is entitled shall be paid to such Employee after the effective date of
a Change in Control in cash in a lump sum within fourteen (14) days following
receipt by the Company of an executed Release Form or, where applicable,
following the expiration of the revocation period provided for on the Release
Form.  Any Severance Pay shall be offset
by any other severance pay or other income replacement, or any pay or wages in
lieu of notice of a plant closing, or any pay or wages paid following issuance
of a notice of a plant closing, including without limitation any mandated
severance pay benefits required under any applicable law.



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If an Eligible Employee dies following execution of
the Release Form, but before receiving all or part of the Severance Pay to
which he is entitled, the Plan Administrator shall pay such Eligible Employee’s
Severance Pay to the Eligible Employee’s estate.


SECTION FIVE


FUNDING


Funding for this Plan shall come solely from the
general assets of the Employer.  All
payments of Severance Pay shall be paid from the general assets of the
Employer.  Neither the Employer nor the
Plan Administrator shall have any obligation to establish a trust or fund for
the payment of benefits under the Plan or to insure any of the benefits under
the Plan.  None of the officers, members
of the Board of Directors, or agents of the Employer or the Plan Administrator guarantees
in any manner the payment of benefits hereunder.


SECTION SIX


CLAIMS PROCEDURE


6.1           Filing and Initial Determination of Claim.  An
Eligible Employee or his/her duly authorized representative may file a claim
for a benefit to which the claimant believes that he or she is entitled.  Such a claim must be in writing and delivered
to the Plan Administrator by postage prepaid certified mail.  Within fifteen (15) days after receipt of a
claim, the Plan Administrator shall send to the claimant by certified mail,
postage prepaid, notice of the granting or denying, in whole or in part, of
such claim, unless special circumstances require an extension of time for
processing the claim.  In no event may
the extension exceed fifteen (15) days from the end of the initial period.  If such extension is necessary, the claimant
will be given a written notice to this effect prior to the expiration of the
initial 15-day period.  The extension
notice shall indicate the special circumstances requiring an extension of time
and the date by which the Plan expects to render the benefit
determination.  The Plan Administrator
shall have full discretion to deny or grant a claim in whole or in part.  If notice of the denial of a claim is not furnished
in accordance with this Section 6.1, the claim shall be deemed denied and the
claimant shall be permitted to exercise his/or right to review pursuant to
Section 6.3.


6.2           Duty of Plan Administrator Upon Denial of
Claim.  If a claim for benefits is denied, the Plan
Administrator shall provide to the claimant written notice setting forth in a
manner calculated to be understood by the claimant: (i) the specific reason or
reasons for the denial; (ii) specific reference to pertinent Plan provisions on
which the denial is based; (iii) a description of any additional material or
information necessary for the claimant to perfect the claim and an explanation
of why such material is necessary; and (iv) a description of the Plan’s claims
review procedure and the time limits applicable to such procedures, including a
statement of the claimant’s right to bring a civil action under Section 502(a)
of ERISA following a denial of the claim on review.


6.3           Request for Review of Claim Denial.  If
an Eligible Employee receives written notification of the denial in whole or in
part of his/her claim pursuant to Section 6.1, or if an employee is not
included in Schedule A and is therefore not eligible for benefits under
this Plan, within sixty (60) days of the Eligible Employee’s receipt of claim
denial or the date the employee becomes aware that he is not eligible for
benefits under this Plan, if the claimant disagrees with such action, the
claimant or his/her



 6
 






 



authorized
representative shall file a written request with the Plan Administrator that it
conduct a full and fair review of the denial of the claim for benefits.  In connection with any request for a review
of the denial of a claim for benefits, the claimant shall have the opportunity
to submit written comments, documents, records, and other information relating
to the claim for benefits.  The Plan
Administrator shall provide the claimant, upon request and free of charge,
reasonable access to, and copies of, all documents, records, and other
information relevant to the claimant’s claim for benefits.  A document, record, or other information
shall be considered “relevant” to a claim for benefits if that document, record
or other information: (i) was relied upon in making the benefit determination;
(ii) was submitted, considered, or generated in the course of making the
benefit determination, without regard to whether such document, record or other
information was relied upon in making the benefit determination; or (iii)
demonstrates compliance with the administrative process and safeguards required
by ERISA in making the benefit determination. 
The review of a denial shall take into account all comments, documents,
records, and other information submitted by the claimant, without regard to
whether such information was submitted or considered in the initial benefit
determination.


6.4           Decision on Review of Denial.  Upon
receipt of the request for review, the Plan Administrator shall review the
claim and shall deliver to the claimant a written decision on the claim for
benefits within sixty (60) days after the receipt of the aforesaid request for
review, except that if there are special circumstances (such as the need to
hold a hearing, if necessary) that require an extension of time for processing,
the aforesaid sixty (60) day period shall be extended to one hundred twenty
(120) days and the claimant will be given written notice of the extension prior
to the expiration of the initial 60-day period. 
In no event shall such extension exceed a period of sixty (60) days from
the end of the initial 60-day period. 
The extension notice shall indicate the special circumstances requiring
an extension of time and the date by which the Plan expects to render the
determination on review.


The Plan Administrator’s decision shall be written in a manner
calculated to be understood by the claimant. 
Any notice of a denial on review shall include (i) the specific reason
or reasons for the denial on review; (ii) reference to the specific plan
provisions on which the denial is based; (iii) a statement that the claimant is
entitled to receive, upon request and free of charge, reasonable access to, and
copies of all documents, records, and other information relevant to the
claimant’s claim for benefits; and (iv) a statement of the claimant’s right to
bring an action under Section 502(a) of ERISA. 
If notice of the decision on the review is not furnished in accordance
with this Section 6.4, the claim shall be deemed denied and the Plan
Administrator will have no further duty to review such claim.


SECTION SEVEN


ADMINISTRATION OF THE PLAN


7.1           Plan Administrator.  The
Plan Administrator hereunder shall be the Compensation Committee as appointed
from time to time by the Board of Directors of the Company.


7.2           Responsibilities.  The
Plan Administrator shall be the “administrator” (as defined in Section 3(16)(A)
of ERISA) of the Plan, and shall be responsible for all obligations under the
Internal Revenue Code and ERISA and all other obligations required or permitted
to be performed by the Plan Administrator and not otherwise delegated pursuant
to the Plan.  The Plan Administrator
shall be the designated agent for service of legal process.


7.3           Allocation and Delegation of Plan
Administrator Responsibilities.  The Plan Administrator may appoint such
assistants or representatives as it deems necessary for the effective



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exercise
of its duties in administering the Plan and may delegate to such assistants and
representatives any powers and duties, both ministerial and discretionary, as
it deems expedient or appropriate.  The
Plan Administrator also may designate any person, firm or corporation to carry
out any of the other responsibilities of the Plan Administrator under the
Plan.  Any such allocation or designation
shall be made pursuant to a written instrument executed by the Plan
Administrator.


7.4           Actions of Fiduciaries.  The
Plan Administrator may authorize or approve any action by written instrument
signed by a person duly authorized to act on behalf of the Plan
Administrator.  Any written memorandum
signed by any such duly authorized person or by any other person duly
authorized by the Plan Administrator to act in respect of the subject matter of
the memorandum, shall have the same force and effect as a formal resolution
adopted by the Plan Administrator.


All acts and determinations with respect to the administration of the
Plan made by the Plan Administrator and any assistants or representatives
appointed by it shall be duly recorded by the Plan Administrator or by the
assistant or representative appointed by it to keep such records.  All records, together with such other
documents as may be necessary for the administration of the Plan, shall be
preserved in the custody of the Plan Administrator or the assistants or
representatives appointed by it.


7.5           General Administrative Powers. 
Except as otherwise provided herein, the Plan Administrator is
authorized to take such actions as may be necessary to carry out the provisions
and purposes of the Plan and shall have the authority to control and manage the
operation and administration of the Plan. 
In order to effectuate the purposes of the Plan, the Plan Administrator
shall have the discretionary authority and power to construe and interpret the
Plan, to supply any omissions therein, to reconcile and correct any errors or
inconsistencies, to decide any questions in the administration and application
of the Plan, and to make equitable adjustments for any mistakes or errors made
in the administration of the Plan.  All
such actions or determinations made in good faith by the Plan Administrator,
and the application of rules and regulations to a particular case or issue by
the Plan Administrator shall, subject to the claims procedures set forth in
Section Six hereof, not be subject to review by anyone, but shall be final,
binding and conclusive on all persons ever interested hereunder.  In construing the Plan and in exercising its
power under provisions requiring the Plan Administrator’s approval, the Plan
Administrator shall attempt to ascertain the purpose of the provisions in
question and when such purpose is known or reasonably ascertainable, such purpose
shall be given effect to the extent feasible. 
In the discharge of this discretionary authority the Plan Administrator
shall have all necessary powers and duties, including but not limited to the
following:


(a)           to require any person to furnish such information as is reasonably
necessary or appropriate for administration of the Plan as a condition to
receiving benefits under the Plan;


(b)           to make such rules and regulations and prescribe the use of such forms
as he shall deem necessary for the efficient administration of the Plan;


(c)           to establish or cause to be established such procedures, protocols and
guidelines as he shall deem necessary to interpret the terms and conditions of
the Plan;


(d)           to decide on questions concerning Plan eligibility, Years of Employment
and employment termination in accordance with the terms of the Plan;


(e)           to determine the amount of benefits payable to an Eligible Employee, in
accordance with the Plan, and to provide a full and fair review to any Eligible
Employee whose claim for benefits has been denied in whole or in part; and



 8
 






 



(f)            to designate other persons to carry out any
duty or power which would otherwise be a fiduciary responsibility of the Plan
Administrator, under the terms of the Plan.


7.6           Appointment of Professional Assistance.  The
Plan Administrator may engage accountants, attorneys and such other personnel
as it deems necessary or advisable.  The
functions of any such persons engaged by the Plan Administrator shall be
limited to the specific services and duties for which they are engaged, and
such persons shall have no other duties, obligations or responsibilities under
the Plan.  Unless otherwise specifically
so delegated, such persons shall exercise no discretionary authority or
discretionary control respecting the management of the Plan.


7.7           Discretionary Acts.  Any
discretionary actions of the Plan Administrator with respect to the
administration of the Plan shall be made in a manner which does not
discriminate in favor of stockholders, officers and highly compensated
employees.


7.8           Responsibility of Fiduciaries.  The
Plan Administrator and its assistants and representatives shall be free from
all liability for their acts and conduct in the administration of the Plan
except for acts of gross negligence, fraud or willful misconduct; provided,
however, that the foregoing shall not relieve any of them from any
responsibility or liability for any responsibility, obligation or duty that
they may have pursuant to ERISA.


7.9           Indemnity by Employer.  In
the event and to the extent not insured against by any insurance company
pursuant to provisions of any applicable insurance policy, the Employer shall
indemnify and hold harmless the Plan Administrator and its assistants and
representatives from any and all claims, demands, suits or proceedings in
connection with the Plan that may be brought by the Employer’s employees or
their legal representatives, or by any other person, corporation, entity,
government or agency thereof, including any amounts paid in settlement, with
the approval of the Plan Administrator, and any and all other losses, damages,
interest, expenses, including counsel fees approved by the Plan Administrator,
and penalties, including any penalties imposed by the Secretary of Labor
pursuant to Section 502(l) of ERISA relating to any breaches of fiduciary
responsibility under Part 4 of Title I of ERISA, arising from any
action or failure to act, except where the same is judicially determined to be
due to gross negligence, fraud, or willful misconduct of such individual in
connection with the Plan.  The
indemnification contained in this Section shall apply regardless of whether the
event causing the liability arises in whole or in part from the negligence
(other than judicially determined gross negligence) or other fault on the part
of the individual, specifically including breaches of fiduciary responsibility
under ERISA.


SECTION EIGHT


ADOPTION OF PLAN BY SUBSIDIARY


Any subsidiary of the Company, whether or not
presently existing, may, with the approval of the Plan Administrator, adopt
this Plan.  Any such subsidiary that
adopts the Plan is thereafter an Employer with respect to its employees for
purposes of the Plan.



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SECTION NINE


AMENDMENT OF THE PLAN


The Plan Administrator may amend the Plan at any
time and in any manner with respect to all of the Employees. Any amendment to
this Plan shall be effectuated by a written instrument signed by the Plan
Administrator and shall be incorporated into the Plan document.  Any amendment or restatement may be made
retroactive if, in the judgment of the Plan Administrator, such retroactivity
is necessary or advisable for any reason. 
Notwithstanding the above, this Plan may not be terminated or amended
within six months following a Change in Control.


SECTION TEN


TERMINATION OF THE PLAN


Continuance of the Plan is not assumed as a
contractual obligation of the Employer, and the Plan Administrator reserves the
right to terminate the Plan at any time. Notwithstanding the above, this Plan
may not be terminated or amended within six months following a Change in
Control.  Such termination may occur
without consent being obtained from the Plan Administrator, Eligible Employees
or any other interested person.  The Plan
shall automatically terminate upon dissolution of the Company, unless provision
is specifically made by its successors, if any, for the continuation of the
Plan.  If not sooner terminated, this
Plan shall terminate when all liabilities provided for hereunder have been
fully discharged.


SECTION ELEVEN


VESTING


No Eligible Employee shall have a vested right to
any benefit under this Plan prior to the time a determination is made by the
Plan Administrator that the particular Eligible Employee is entitled to receive
benefits under the Plan.  At any time
prior to such determination the Plan may be amended or terminated with respect
to any benefits to which such Eligible Employee would otherwise have been
entitled.


SECTION TWELVE


STATUS OF EMPLOYMENT RELATIONS


The adoption and maintenance of the Plan shall not
be deemed to constitute a contract between any Employer and its employees or to
be consideration for, or an inducement or condition of, the employment of any
person.  Nothing herein contained shall
be deemed (i) to give to any employee the right to be retained in the employ of
the Employer; (ii) to affect the right of the Employer to discipline or
discharge any employee at any time; (iii) to give the Employer the right to
require any employee to remain in its employ; or (iv) to affect any employee’s
right to terminate his employment at any time.



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SECTION THIRTEEN


RESTRICTIONS ON ASSIGNMENT


The benefits provided hereunder are not subject in
any manner to the debts or other obligations of the persons to whom they are
payable.  The interest of an Eligible
Employee may not be sold, transferred, assigned or encumbered in any manner,
either voluntarily or involuntarily, and any attempt so to anticipate,
alienate, sell, transfer, assign, pledge, encumber, or charge the same shall be
null and void.


SECTION FOURTEEN


APPLICABLE LAW


To the extent not preempted by ERISA, the Plan shall
be construed, regulated, interpreted and administered under and in accordance
with the laws of the State of Texas.


SECTION FIFTEEN


INTERPRETATION OF THE PLAN


It is the intention of the Employers that the Plan
shall comply with the Internal Revenue Code, and the regulations thereunder,
the requirements of ERISA and the corresponding provisions of any subsequent
laws; the provisions of the Plan shall be construed to effectuate such
intention.



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IN WITNESS WHEREOF, EXCO Resources, Inc. has caused
the Plan to be signed by its duly authorized officer on this 8th day of November, 2006.


	
  

  	
  EXCO RESOURCES, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
   

  	
  /s/ Douglas H. Miller

  
	
   

  	
   

  	
   

  
	
   

  	
  Its: Chief Executive Officer

  	
   

  
					




 12
 






 



Exhibit A-1


40+


RELEASE AGREEMENT


IN RETURN FOR THE CONSIDERATION of payment of severance benefits to me
from EXCO Resources, Inc. (“EXCO”) in accordance with EXCO Resources, Inc.
Severance Plan, I am entering into this Release Agreement.  I understand and agree that the severance
payment is in addition to the other (non-severance) benefits to which I may be
entitled under the normal policies and procedures applicable to employees of
EXCO as a result of my termination of employment from EXCO.


I,                                                                   ,
on behalf of myself, my heirs, executors, successors and assigns hereby
irrevocably and unconditionally RELEASE, WAIVE, AND FOREVER DISCHARGE EXCO and
all of its parents, divisions, subsidiaries and affiliates, and their present
and former agents, employees, officers, directors, partners, stockholders,
successors and assigns (hereinafter collectively “Releasees”) from any and all
claims, demands, actions and causes of action, and all liability whatsoever,
whether known or unknown, fixed or contingent, which I have or may have
against Releasees as a result of my employment by or subsequent termination as
an employee of EXCO, or failure to be hired by any Releasee, up to the date of
execution of this Release Agreement.  This
Release Agreement includes but is not limited to claims at law or equity or
sounding in contract (express or implied) or tort arising under federal, state
or local laws prohibiting age, sex, race, national origin, disability,
religion, veteran or any other forms of discrimination (including but not
limited to Title VII of the Civil Rights Act of 1964, the Rehabilitation
Act of 1973, the Americans with Disabilities Act, as well as applicable state
fair employment practices laws), claims arising under the Fair Labor Standards
Act, the National Labor Relations Act, the Worker Adjustment and Retraining
Notification Act, the Family and Medical Leave Act, the Employee Retirement
Income Security Act, or any other legal and equitable claims regarding my
employment with EXCO, the continuation of employment or the termination of said
employment.


I understand and agree that this Release Agreement shall not in any way
be construed as an admission by Releasees of any unlawful or wrongful acts
whatsoever against me or any other person, and Releasees specifically disclaim
any liability to or wrongful acts against me or any other person.


I acknowledge that I have been advised in writing by EXCO that I should
consult an attorney prior to executing this Release Agreement, and I further
acknowledge that I have been given a period of forty-five (45) calendars days
after my termination by EXCO within which to review and consider the provisions
of this Release Agreement.


I acknowledge that I have been given information regarding the ages and
job titles of persons affected and unaffected by these terminations of
employment.


I understand and acknowledge that I have seven (7) calendar days
following the execution of this Release Agreement to revoke my acceptance of
this Release Agreement and that this Release Agreement shall not become
effective and the severance shall not become payable until this revocation
period has expired.  In order to revoke
this Release Agreement, I acknowledge that I am required to deliver written
notice clearly stating my intent to revoke to [Insert
Name and Address of Contact Person at Company].  I agree that my notice will not be considered
effective unless [Mr./Ms. Insert Name],
or a representative designated by EXCO, receives it within the seven calendar days
following my execution of this Release Agreement.



 13
 






 



I understand it is my choice whether or not to enter into this Release
Agreement and that my decision to do so is voluntary and made knowingly.


Please read carefully as this document includes a
release of claims.


As evidenced by my signature below, I hereby certify that I have read
the above Release Agreement and agree to its terms.


Dated this                            
day of                                             ,
2006.


 




	
  

  	
   

  	
   

  
	
  WITNESS

  	
   

  	
  EMPLOYEE SIGNATURE

  







 14
 






 



Exhibit
A-2


Under 40


RELEASE AGREEMENT


IN RETURN FOR THE CONSIDERATION of payment of severance benefits to me
from EXCO Resources, Inc. (“EXCO”) in accordance with the EXCO Resources, Inc.
Severance Plan, I am entering into this Release Agreement.  I understand and agree that the severance
payment is in addition to the other (non-severance) benefits to which I may be
entitled under the normal policies and procedures applicable to employees of
EXCO as a result of my termination of employment from EXCO.


I,                                                                   ,
on behalf of myself, my heirs, executors, successors and assigns hereby
irrevocably and unconditionally RELEASE, WAIVE, AND FOREVER DISCHARGE EXCO and
all of its parents, divisions, subsidiaries and affiliates, and their present
and former agents, employees, officers, directors, partners, stockholders,
successors and assigns (hereinafter collectively “Releasees”) from any and all
claims, demands, actions and causes of action, and all liability whatsoever,
whether known or unknown, fixed or contingent, which I have or may have
against Releasees as a result of my employment by or subsequent termination as
an employee of EXCO, or failure to be hired by any Releasee, up to the date of
execution of this Release Agreement. 
This Release Agreement includes but is not limited to claims at law or
equity or sounding in contract (express or implied) or tort arising under
federal, state or local laws prohibiting age, sex, race, national origin,
disability, religion, veteran or any other forms of discrimination (including
but not limited to Title VII of the Civil Rights Act of 1964, the
Rehabilitation Act of 1973, the Americans with Disabilities Act, as well as
applicable state fair employment practices laws), claims arising under the Fair
Labor Standards Act, the National Labor Relations Act, the Worker Adjustment
and Retraining Notification Act, the Family and Medical Leave Act, the Employee
Retirement Income Security Act, or any other legal and equitable claims
regarding my employment with EXCO, the continuation of employment or the
termination of said employment.


I understand and agree that this Release Agreement shall not in any way
be construed as an admission by Releasees of any unlawful or wrongful acts
whatsoever against me or any other person, and Releasees specifically disclaim
any liability to or wrongful acts against me or any other person.


I acknowledge that I have been advised in writing by EXCO that I should
consult an attorney prior to executing this Release Agreement, and further
acknowledge that I have been given a period of ten (10) calendar days after my
termination by EXCO within which to review and consider the provisions of this
Release Agreement.


I understand and acknowledge that once I have executed this Release
Agreement, it is immediately binding and may not be revoked or rescinded by
either party.


I understand it is my choice whether or not to enter into this Release
Agreement and that my decision to do so is voluntary and is made knowingly.



 15
 






 



Please read carefully as this document includes a
release of claims.


As evidenced by my signature below, I hereby certify that I have read
the above Release Agreement and agree to its terms.


Dated this                            
day of                                             ,
2006.


 


 




	
  

  	
   

  	
   

  
	
  WITNESS

  	
   

  	
  EMPLOYEE SIGNATURE

  






 



 16