Third Point representatives named to TXCO Resources board as part of settlement agreement

By Lisa Kerner

Charlotte, N.C., March 18 - TXCO Resources Inc. and Third Point LLC said they reached a settlement agreement in a lawsuit pending in the Delaware Court of Chancery and a related proxy contest.

According to a TXCO news release, the company agreed to appoint Third Point nominees Jacob Roorda and Anthony Tripodo to the six-member board, replacing current directors James L. Hewitt, J. Michael Muckleroy and Robert L. Foree Jr., who have agreed to step down.

Muckleroy has been re-appointed by the board as a class B director to fill the vacancy created by Hewitt's resignation.

In addition, Roorda and Tripodo, along with current director Dennis B. Fitzpatrick, will stand for re-election for three-year terms at TXCO's annual meeting on May 9.

Roorda is president of Harvest Energy Trust, a Calgary, Alta.-based oil and gas exploration and production trust. Tripodo is executive vice president and chief financial officer of Tesco Corp., a Houston-based oilfield services technology company.

Third Point, for its part, agreed to dismiss its lawsuit seeking to nullify TXCO's January appointment of Hewitt to its board.

TXCO chief executive officer James E. Sigmon said the agreement was in the best interest of all the company's stockholders.

"Third Point's two representatives will bring many years of valuable experience in the exploration and production and oilfield services businesses to our board," Sigmon said in the release.

"Our goal is to build stockholder value, and we look forward to working with them collaboratively to achieve that goal," Sigmon added.

Third Point questioned board appointment

On March 3, TXCO asked its stockholders to reject Third Point's slate of nominees for election at the annual meeting. The investor's original slate of nominees had also included Todd Q. Swanson.

It was previously reported that Sigmon said Third Point failed to present a single idea or recommendation on how TXCO could increase stockholder value.

On Feb. 28, Third Point amended its lawsuit alleging that TXCO's appointment of Hewitt to its board was a breach of duty of care.

According to TXCO, Hewitt was appointed to fill a vacancy due to the retirement of Stephen M. Gose Jr. However, Third Point said TXCO disclosed that the board had been reduced to six directors following Gose's retirement and in connection with its 2007 annual meeting, making Hewitt the seventh director, according to a prior news release.

Third Point has an 8.3% ownership interest in the San Antonio-based oil and gas company.

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