This was an experimental weapon at the time of the war. Manufactured, primarily, from high-strength polymers, the weapon is almost indestructible. It's light, fast firing, accurate, and can be broken down without the use of any tools.
The only thing really special about this weapon is its superior damage per shot compared to the AK-112 assault rifle. Its range and capacity is inferior, however.
By the time it can be acquired, the XL70E3 will be going up against advanced power armor. As such, it will not be used much. Against the leather jacket-wearing vagrants, however, the 5mm lead will fare much better.
This weapon can be rather difficult to get. One of the black-haired female vagrants on the tanker in San Francisco has one, but it has to be looted (cannot be stolen from her). Also, sometimes randomly encountered merchants outside of San Francisco may have this weapon for sale.