EXCO Resources, Inc. Announces Closing of Eagle Ford Acquisition

  EXCO Resources, Inc. Announces Closing of Eagle Ford Acquisition

Business Wire

DALLAS -- July 31, 2013

EXCO Resources, Inc. (NYSE:XCO) (“EXCO”) today announced that it has closed
its previously announced acquisition of producing and undeveloped oil and gas
assets in the Eagle Ford shale formation (“Eagle Ford”) from subsidiaries of
Chesapeake Energy Corporation for total consideration of approximately $685
million in cash, subject to customary post-closing purchase price adjustments.
The acquisition had an effective date of April 1, 2013.

EXCO financed the Eagle Ford acquisition under the Company’s recently amended
and restated credit agreement which has an initial $1.6 billion borrowing
base. The initial borrowing base includes a $1.3 billion revolving facility
and a $300 million term loan. The term loan portion of the facility is
expected to be replaced with a new term loan containing terms and conditions
customary for a transaction of this nature. The credit agreement provides that
the initial borrowing base will be reduced by $400 million through the sale of
certain selected assets during the next twelve months.

In connection with the closing, EXCO entered into a Participation Agreement
with entities advised by or affiliated with Kohlberg Kravis Roberts & Co. L.P.
(collectively, “KKR”), including KKR Financial Holdings LLC (NYSE:KFN), and
sold an undivided 50% interest in the undeveloped acreage EXCO acquired for
approximately $131 million in cash, after preliminary closing adjustments.
Proceeds from the sale of properties under the KKR agreement were used to
reduce outstanding borrowings under the EXCO Resources Credit Agreement. After
giving effect to the acquisition and the KKR payment, the Credit Agreement’s
initial borrowing base and the $400 million asset sale requirement were
reduced by $131 million and approximately $1.3 billion is currently

The Participation Agreement provides that EXCO and KKR will jointly fund
future development costs. With respect to each well drilled, EXCO will assign
half of its undivided 50% interest in such well to KKR such that KKR will fund
and own 75% of each well drilled and EXCO will fund and own 25% of each well
drilled. When each quarterly tranche of wells drilled has been on production
for one year, EXCO has the right to offer to purchase KKR’s 75% working
interest at fair market value, subject to specific well criteria and return
hurdles. With respect to the first year (first four quarters) of the
development program, EXCO would make its first offer for wells that have been
online for one year during the fourth quarter of 2014. The parties have agreed
on approximately 300 identified locations to be drilled over a five year

EXCO Resources, Inc. is an oil and natural gas exploration, exploitation,
development and production company headquartered in Dallas, Texas with
principal operations in Texas, North Louisiana and Appalachia.

Additional information about EXCO Resources, Inc. may be obtained by
contacting EXCO’s Chairman and Chief Executive Officer, Douglas H. Miller, or
its President and Chief Operating Officer, Harold L. Hickey, or its Executive
Vice President and Chief Financial Officer, Mark F. Mulhern, at EXCO’s
headquarters, 12377 Merit Drive, Suite 1700, Dallas, TX 75251, telephone
number (214) 368-2084, or by visiting EXCO’s website at www.excoresources.com.
EXCO’s SEC filings and press releases can be found under the Investor
Relations tab.

This release may contain forward-looking statements relating to future
financial results, business expectations and business transactions. Business
plans may change as circumstances warrant. In addition, the anticipated
benefits from the transactions may not be fully realized. Actual results may
differ materially from those predicted as a result of factors over which EXCO
has no control. Such factors include, but are not limited to: estimates of
reserves, commodity price changes, regulatory changes and general economic
conditions. These risk factors and additional information are included in
EXCO’s reports on file with the Securities and Exchange Commission. EXCO
undertakes no obligation to publicly update or revise any forward-looking


EXCO Resources, Inc.
Douglas H. Miller, 214-368-2084
Chairman and Chief Executive Officer
Harold L. Hickey, 214-368-2084
President and Chief Operating Officer
Mark F. Mulhern, 214-368-2084
Executive Vice President and Chief Financial Officer
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