Document:

exv10w8

 

Exhibit 10.8

Execution Copy

LOAN TRANSFER AGREEMENT

     This LOAN TRANSFER AGREEMENT (this “Agreement”) is dated as of November 15, 2007, by
and among QUEST RESOURCE CORPORATION, a Nevada corporation (“QRC”), QUEST CHEROKEE, LLC, a
Delaware limited liability company (“Borrower”), Quest Oil & Gas Corporation
(“QO&G”), Quest Energy Service, Inc. (“QES”), and Quest Cherokee Oilfield Service,
LLC (“QCOS”; QO&G, QES and QCOS collectively the “Guarantors”), GUGGENHEIM
CORPORATE FUNDING, LLC, as administrative agent for the Senior Lenders (defined below) under the
Senior Credit Agreement (defined below) (the “Senior Agent”), GUGGENHEIM CORPORATE FUNDING,
LLC, as administrative agent for the Second Lien Lenders (defined below) under the Second Lien Term
Loan Agreement (defined below) (the “Second Lien Agent”), GUGGENHEIM CORPORATE FUNDING,
LLC, as administrative agent for the Third Lien Lenders (defined below) under the Third Lien Term
Loan Agreement (defined below) (the “Third Lien Agent”), the Senior Lenders, the Second
Lien Lenders, the Third Lien Lenders, WELLS FARGO FOOTHILL, INC. as issuing bank under the Senior
Credit Agreement (the “Letter of Credit Issuer”), GUGGENHEIM CORPORATE FUNDING, LLC, as
Collateral Agent under the Intercreditor Agreement (defined below) (the “Collateral Agent”
and, together with the Senior Agent, Second Lien Agent and the Third Lien Agent, collectively, the
“Agents”), ROYAL BANK OF CANADA, as administrative agent and collateral agent for the New
Lenders (defined below) under the New Credit Agreement (defined below) (the “New Agent”)
and the New Lenders.

RECITALS

     A. Pursuant to the terms of that certain Amended and Restated Senior Credit Agreement dated as
of February 7, 2006 (as amended, the “Senior Credit Agreement”), among QRC, Borrower, the
Senior Agent, and the Lenders (as defined in the Senior Credit Agreement) party thereto
(collectively, the “Senior Lenders”), the Senior Lenders have made certain loans and other
financial accommodations to QRC and Borrower, as evidenced by the Senior Credit Agreement and (i)
the Letters of Credit (as defined in the Senior Credit Agreement) listed on Exhibit F hereto (the
“Outstanding Letters of Credit”), and (ii) the Swap Agreements (as defined in the Senior
Credit Agreement) identified on Exhibit C hereto (the “Outstanding Swap
Agreements”).

     B. Pursuant to the terms of that certain Amended and Restated Second Lien Term Loan Agreement
dated as of June 9, 2006 (as amended, the “Second Lien Term Loan Agreement”), among QRC,
Borrower, the Second Lien Agent, and the Lenders (as defined in the Second Lien Term Loan
Agreement) party thereto (collectively, the “Second Lien Lenders”), the Second Lien Lenders
have made certain loans and other financial accommodations to QRC and Borrower, as evidenced by the
Second Lien Term Loan Agreement.

     C. Pursuant to the terms of that certain Third Lien Term Loan Agreement dated as of June 9,
2006 (as amended, the “Third Lien Term Loan Agreement” and together with the Senior Credit
Agreement and Second Lien Term Loan Agreement, the “Existing Credit Agreements”),

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among QRC, Borrower, the Third Lien Agent, and the Lenders (as defined in the Third Lien Term
Loan Agreement) party thereto (collectively, the “Third Lien Lenders” and together with the
Senior Lenders and the Second Lien Lenders, the “Existing Lenders”), the Third Lien Lenders
have made certain loans and other financial accommodations to QRC and Borrower, as evidenced by the
Third Lien Term Loan Agreement.

     D. The aggregate of the indebtedness outstanding under the Existing Credit Agreements, except
and excluding therefrom the indebtedness pertaining to the Outstanding Letters of Credit and the
indebtedness pertaining to the Outstanding Swap Agreements, is hereafter collectively referred to
as the “Existing Debt;” the documents securing, guaranteeing or otherwise pertaining to the
indebtedness under the Existing Credit Agreements (except and excluding therefrom the Outstanding
Swap Agreements and any letter of credit application and/or or reimbursement agreement pertaining
to any of the Outstanding Letters of Credit) described on Exhibit B attached hereto are
hereafter collectively referred to as the “Existing Loan Documents”, and all property
described in the Existing Loan Documents as collateral securing such Existing Debt is hereafter
collectively referred to as the “Collateral”.

     E. To set forth the relative rights of the Senior Agent and the Senior Lenders, the Second
Lien Agent and the Second Lien Lenders and the Third Lien Agent and the Third Lien Lenders, QRC,
Borrower, the Guarantors, the Agents, the Existing Lenders and BP Corporation North America, Inc.,
formerly known as BP Amoco Corporation (“BP”), executed that certain Second Amended and
Restated Intercreditor Agreement dated as of June 9, 2006 (as amended, the “Intercreditor
Agreement”).

     F. The Agents and the Existing Lenders (collectively, “Assignors” and, each
individually, an “Assignor”) have agreed to irrevocably sell, transfer and assign to the
New Agent and the lenders (collectively, the “New Lenders” and, together with the New
Agent, collectively, the “Assignees” and, each individually, an “Assignee”) party
to that certain Amended and Restated Credit Agreement dated as of November 15, 2007, among the New
Agent, the New Lenders, QRC and the Borrower (the “New Credit Agreement”), all of their
interests in, to and under the Existing Debt and the Existing Loan Documents, including, without
limitation, the security interests and liens created thereby and Assignors’ rights to all principal
now due or hereafter due and all interest, fees, costs and expenses relating thereto, save and
except (i) the Letter of Credit Issuer’s lien and security interest in the Cash Collateral (defined
below), which the Letter of Credit Issuer shall retain to secure the obligations of QRC, Borrower
and Guarantors with respect to the Outstanding Letters of Credit, (ii) the rights and obligations
with respect to the Outstanding Letters of Credit, (iii) the Senior Agent’s and the Senior Lenders’
rights of indemnification which by their terms would survive the termination of the Existing Loan
Documents, (iv) the Second Lien Agent’s and Second Lien Lenders’ rights of indemnification which by
their terms would survive the termination of the Existing Loan Documents, (v) the Third Lien
Agent’s and Third Lien Lenders’ rights of indemnification which by their terms would survive the
termination of the Existing Loan Documents, and (vi) the Collateral Agent’s rights of
indemnification which by their terms would survive the termination of the Existing Loan Documents
(the foregoing interests and rights, save and except the interests and rights described or to which
reference is made in the preceding clauses (i) through (vi), inclusive, being collectively referred
to herein as the “Assigned Rights”), all subject to the terms

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and conditions set forth herein. For the avoidance of doubt, the Assigned Rights do not
include any internal books and records of any Assignor relating to the Assigned Rights, including,
but not limited to any underwriting memoranda, internal memoranda, internal correspondence,
internal electronic mail, and correspondence with third parties, including counsel.

AGREEMENTS

     NOW, THEREFORE, in consideration of the mutual promises and covenants contained herein and
other good and valuable consideration, the receipt and sufficiency of which are hereby
acknowledged, and intending to be legally bound hereby, the parties hereto agree as follows:

     1. Sale and Assignment: Purchase Price: Cash Collateral.

          (a) Upon receipt by (i) the Senior Agent, Second Lien Agent and the Third Lien Agent of the
applicable portions of the Purchase Price (defined below), (ii) the Letter of Credit Issuer of the
Cash Collateral (defined below), (iii) Royal Bank of Canada of the Swap Assignment (defined below),
duly executed by the parties thereto, and (iv) the Agents of an amount sufficient to pay the fees
and expenses referenced in Section 4 below, (A) each Assignor shall sell, transfer, assign,
grant and convey unto Assignees, their successors and assigns, on the Assignment Date (defined
below) its interest in the Assigned Rights, WITHOUT RECOURSE, REPRESENTATION OR WARRANTY and (B)
the Assignees shall assume any and all of Assignors’ obligations in and to the Assigned Rights.

          (b) In full payment for the Existing Debt and the Assigned Rights, the New Agent, on behalf of
the New Lenders, will pay, by wire-transfer using the wiring instructions set forth on Exhibit
D hereto (and assuming (i) no change in the applicable interest rates under the Existing Credit
Agreements after the date hereof and (ii) no further borrowings under the Existing Credit
Agreements after the date hereof), the following amounts to the following parties on or prior to
3:00 p.m. (New York time) on November 15, 2007: (a) $85,671,885.94, to Senior Agent, for the
benefit of the Senior Lenders (with a per diem of $19,595.68 for each day after such time and date,
if applicable); (b) $102,677,500.00, to the Second Lien Agent, for the benefit of the Second Lien
Lenders (with a per diem of $28,500.00 for each day after such time and date, if applicable), (c)
$77,273,750.00, to the Third Lien Agent, for the benefit of the Third Lien Lenders (with a per diem
of $26,583.33 for each day after such time and date, if applicable), (d) $25,000.00, to Senior
Agent, for the benefit of the Senior Agent, Second Lien Agent, Third Lien Agent and the Letter of
Credit Issuer and (e) $44,275.31, to Sidley Austin LLP in respect of legal fees (such amounts are
referred to collectively herein as the “Purchase Price”). Upon receipt of the Purchase
Price, the Senior Agent, Second Lien Agent or the Third Lien Agent (as applicable) will promptly
pay to each Existing Lender such Existing Lender’s pro rata share of the Purchase Price. A detailed
breakdown of the principal, accrued interest, breakage costs and fees and expenses comprising the
Purchase Price is set forth on Exhibit E. The Agents hereby reserve the right to notify the
Borrower and the New Agent of any change in the applicable interest rate under the Existing Credit
Agreements and of any further borrowing under the Existing Credit Agreements after the date hereof
and to adjust the Purchase Price accordingly.

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          (c) The Borrower shall deposit by wire-transfer using the wiring instructions set forth on
Exhibit D hereto into an account in the name of the Letter of Credit Issuer (the “Cash
Collateral Account”) $1,260,000 to be held by the Letter of Credit Issuer as cash collateral
(the “Cash Collateral”) to secure the obligations of QRC, Borrower and Guarantors set forth
in Section 8 of this Agreement and any reimbursement agreement entered into in connection with any
Outstanding Letter of Credit, including any letter of credit application therefor (any such
reimbursement agreement, a “Reimbursement Agreement”) in respect of the Outstanding Letters
of Credit.

          (d) BP, the Borrower and Royal Bank of Canada shall each execute and deliver to the other, a
Novation Agreement in form and substance acceptable to each of them (the “Swap Assignment”)
with respect to the Outstanding Swap Agreements.

          (e) This Agreement shall be effective upon the payment of the Purchase Price deposit of the
Cash Collateral in the Cash Collateral Account and the satisfaction of each of the conditions set
forth in this Section 1 and Section 4 (the date on which the last of such conditions to be
satisfied is satisfied being herein referred to as the “Assignment Date”), whereupon the
Senior Agent on behalf of the Senior Lenders, the Second Lien Agent on behalf of the Second Lien
Lenders and the Third Lien Agent on behalf of the Third Lien Lenders shall promptly deliver to QRC,
Borrower and the New Agent the Receipt (the form of which is attached hereto as Annex 1)
confirming (i) the Senior Agent’s, the Second Lien Agent’s and the Third Lien Agent’s receipt of
the applicable portions of the Purchase Price and (ii) the satisfaction of all other conditions set
forth in this Section 1. Except as set forth in Sections 2 and 3 below,
this Agreement shall expire at, and the Assignors shall have no further obligations to Assignees
after, 3:00 p.m. (New York time) on November 30, 2007, unless the payment of the Purchase Price,
the deposit of the Cash Collateral in the Cash Collateral Account and each of the conditions set
forth in this Section 1 and Section 4 is timely satisfied on or before such date as
provided herein.

     2. Delivery of Existing Loan Documents and Termination Statements. As soon as
reasonably practicable, but in any event within fifteen Business Days (as defined in the New Credit
Agreement) after the Assignment Date, (a) each Agent will deliver to the New Agent (for the benefit
of the Assignees), at no cost or expense to Assignors, all Existing Loan Documents in the
possession of such Agent and (b) the Collateral Agent shall deliver appropriate assignments, in
recordable form (as applicable), of any and all security documents securing the Existing Debt to
New Agent’s counsel, Thompson & Knight LLP, 333 Clay Street, Suite 3300, Houston, Texas 77002,
attention Robert C. Shearer, Esq. (the “Delivery Address”); provided, that Collateral Agent
shall execute and deliver to the New Agent, for the benefit of the New Lenders, at no cost or
expense to Assignors, such original assignments (in recordable form) of the mortgages and deeds of
trust described on Exhibit G hereto (collectively, the “Existing Mortgages”) on the
Assignment Date at the Delivery Address, such assignment to be in substantially the form of Exhibit
I hereto and in such number of original counterparts as requested by New Agent. The Agents and the
Existing Lenders authorize the New Agent following the payment of the Purchase Price, deposit of
the Cash Collateral in the Cash Collateral Account and upon satisfaction of the other conditions
set forth in Section 1 and Section 4 hereof, to file any UCC-3 termination statements and
UCC-3 assignments pertaining to UCC financing statements filed by

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the Agents in respect of the collateral of QRC and/or Borrower, its subsidiaries and the
Guarantors.

     3. Further Assurances. Following the Assignment Date, (a) Assignors agree, at no cost
or expense to Assignors, to promptly do or cause to be done such further acts and to execute such
further instruments as the New Agent or any New Lender may reasonably request in order to carry out
the purposes of this Agreement and (b) QRC, Borrower, Guarantors and Assignees agree (i) at no cost
or expense to Assignors, to promptly do or cause to be done such further acts and to execute such
further instruments as any Agent may reasonably request in order to carry out the purposes of this
Agreement and (ii) to pay all fees and expenses incurred by the Agents, Senior Lenders, Second Lien
Lenders, Third Lien Lenders and the Letter of Credit Issuer in connection with the preparation,
execution, delivery, administration, and enforcement of the Swap Assignment, the Outstanding
Letters of Credit, the Cash Collateral Account (and the pledge thereof as security for the
obligations referenced in Section 1(c) hereof) and this Agreement.

     4. Fees and Expenses. On or prior to the Assignment Date and as a condition precedent
to the assignment, sale and transfer of the Assigned Rights, the Borrower shall pay to the Senior
Agent, the Second Lien Agent, the Third Lien Agent and the Collateral Agent all accrued and unpaid
fees and expenses (including, without limitation, attorneys’ fees) payable by QRC, Borrower, or any
Guarantor to any Agent pursuant to the terms of the Senior Credit Agreement, the Second Lien Term
Loan Agreement, the Third Lien Term Loan Agreement, the Intercreditor Agreement, any other Loan
Document or any Outstanding Swap Agreement. From and after the Assignment Date, the Borrower shall
promptly pay to the Senior Agent, the Second Lien Agent, the Third Lien Agent, the Collateral Agent
and the Letter of Credit Issuer all reasonable fees and expenses (including, without limitation,
reasonable attorneys’ fees) incurred by such parties in connection with the preparation,
negotiation and execution of this Agreement, the consummation of the transactions contemplated
hereby, and the satisfaction of the obligations of the Senior Agent, the Second Lien Agent, the
Third Lien Agent, the Collateral Agent and the Letter of Credit Issuer hereunder.

     5. Indemnification. From and after the Assignment Date, (a) the New Agent shall be
deemed for all purposes to replace the Senior Agent, the Second Lien Agent, the Third Lien Agent
and the Collateral Agent under the Existing Loan Documents and (b) the New Agent shall be deemed
for all purposes to have assumed all obligations of Senior Agent, the Second Lien Agent, the Third
Lien Agent and the Collateral Agent under the Existing Loan Documents. QRC, Borrower and the
Guarantors acknowledge and agree that Assignors are entering into this Agreement to accommodate
each of them, and in connection therewith, QRC, Borrower and the Guarantors, jointly and severally
agree to indemnify and hold the Assignors, the Letter of Credit Issuer and each of their directors,
officers, employees, agents, affiliates, attorneys, successors and assigns (collectively, the
“Indemnified Parties”) harmless from any and all claims, covenants, promises, agreements,
obligations, controversies, losses, damages, costs, expenses, demands, causes of action, judgments
or liabilities related to this Agreement (each, a “Loss”), except with respect to any Loss arising
out of the gross negligence or willful misconduct of the Assignors.

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     6. Disclaimer. ASSIGNEES ACKNOWLEDGE AND AGREE THAT ASSIGNORS HAVE NOT MADE, DO NOT
MAKE AND SPECIFICALLY NEGATE AND DISCLAIM ANY REPRESENTATIONS, WARRANTIES, PROMISES, COVENANTS,
AGREEMENTS OR GUARANTIES OF ANY KIND OR CHARACTER WHATSOEVER, WHETHER EXPRESS OR IMPLIED (INCLUDING
WITHOUT LIMITATION, ANY WARRANTY OF FITNESS FOR A PARTICULAR PURPOSE), ORAL OR WRITTEN, PAST,
PRESENT OR FUTURE, OF, AS TO, CONCERNING OR WITH RESPECT TO THE ASSIGNED RIGHTS OR FUTURE
PERFORMANCE OF THE ASSIGNED RIGHTS OR COLLATERAL RELATING THERETO INCLUDING WITHOUT LIMITATION THE
FOLLOWING: (a) QRC’S, BORROWER’S, OR ANY GUARANTOR’S TITLE TO THE PROPERTIES REFERRED TO ABOVE OR
IN ANY OF THE EXISTING LOAN DOCUMENTS; (b) THE ACCURACY OF THE PROPERTY DESCRIPTION OR OF ANY
RECORDING OR OTHER INFORMATION STATED, RECITED OR REFERRED TO ABOVE OR IN ANY OF THE EXISTING LOAN
DOCUMENTS; (c) THE VALIDITY, ENFORCEABILITY OR PRIORITY OF THE NOTES, THE OTHER EXISTING LOAN
DOCUMENTS OR THE OUTSTANDING SWAP AGREEMENTS, THE LIENS OR THE COLLECTIBILITY OF THE LOANS RELATED
THERETO OR PERFECTION OF ANY SECURITY INTEREST OR LIEN; (d) THE EXISTENCE OR BASIS FOR ANY CLAIM,
COUNTERCLAIM, DEFENSE OR OFFSET RELATING TO THE EXISTING DEBT OR THE COMPLIANCE OF THE EXISTING
DEBT WITH ANY LAWS, ORDINANCES OR REGULATIONS OF ANY GOVERNMENTAL OR OTHER BODY; (e) THE LEGAL,
FINANCIAL OR OTHER CAPACITY, CONDITION OR STATUS OF THE MAKER OR ANY OTHER OBLIGOR, GUARANTOR OR
SURETY ON THE NOTES; (f) THE ECONOMIC, ENVIRONMENTAL OR OTHER VALUE, CONDITION OR STATUS OF ANY
COLLATERAL; AND (g) THE PRESENCE ON OR DISCHARGE OR EMISSION FROM SUCH PROPERTY OR OTHER
COLLATERAL, WHETHER NOW OR IN THE PAST, OF ANY HAZARDOUS SUBSTANCES (AS DEFINED IN THE SENIOR
CREDIT AGREEMENT). ASSIGNEES FURTHER ACKNOWLEDGE AND AGREE THAT HAVING BEEN GIVEN THE OPPORTUNITY
TO INSPECT THE ASSIGNED RIGHTS AND COLLATERAL RELATING THERETO, ASSIGNEES ARE RELYING SOLELY ON
THEIR OWN INVESTIGATIONS AND NOT ON ANY INFORMATION PROVIDED OR TO BE PROVIDED BY ASSIGNORS. THE
OBLIGATIONS OF ASSIGNORS HEREUNDER ARE SEVERAL AND NOT JOINT AND NO ASSIGNOR SHALL BE LIABLE FOR
ANY ACT OR FAILURE TO ACT OF ANY OTHER ASSIGNOR.

     7. Release. QRC, Borrower and the Guarantors jointly and severally forever release the
Assignors and each of their directors, officers, employees, agents, affiliates, attorneys,
successors and assigns from and against any and all claims, covenants, promises, agreements,
obligations, commitments, controversies, losses, damages, costs, expenses, demands, causes of
action, judgments or liabilities of any kind or character whatsoever, whether matured or contingent
or known or unknown, that such parties may have arising out of, or with respect to, directly or
indirectly, the Existing Loan Documents, the Outstanding Swap Agreements and the transactions
covered thereunder, whether arising before or after the Assignment Date. Without limiting the
foregoing, no Assignor shall have any obligation to make any loans or issue any letters of credit
under the Existing Loan Documents.

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     8. Letters of Credit: Cash Collateral.

          (a) Notwithstanding anything contained herein or in the Existing Loan Documents to the
contrary, at all times on and after the Assignment Date, the obligations of QRC, Borrower and
Guarantors with respect to the Outstanding Letters of Credit (including the reimbursement of any
draw with respect thereto) shall be governed by this Agreement and any Reimbursement Agreement. In
the event of a conflict between this Agreement and any Reimbursement Agreement, this Agreement
shall govern.

          (b) Letter of Credit Issuer agrees with each Senior Lender that, on the Assignment Date,
Letter of Credit Issuer shall be deemed to have repurchased from each other

          Senior Lender the participation interest in each Outstanding Letter of Credit deemed sold to
each Senior Lender pursuant to Section 2.08(d) of the Senior Credit Agreement, and concurrently
therewith, and notwithstanding anything to the contrary contained in Section 2.08(d) of the Senior
Credit Agreement, each such Senior Lender shall be released and discharged from all obligations to
reimburse the Letter of Credit Issuer as provided in Section 2.08(d) of the Senior Credit Agreement
and in any letter of credit application.

          (c) If any payment (an “LC Disbursement”) is made by the Letter of Credit Issuer or
Wells Fargo Bank, N.A. (the “Underlying Issuer”) in respect of an Outstanding Letter of
Credit, QRC, Borrower and Guarantors agree, jointly and severally, to reimburse such LC
Disbursement by paying to the Letter of Credit Issuer an amount equal to such LC Disbursement on
the date that such LC Disbursement is made. If QRC, Borrower and Guarantors fail to make such
payment when due, in addition to any rights Letter of Credit Issuer and Underlying Issuer may have
hereunder, under any Reimbursement Agreement and applicable law, Letter of Credit Issuer shall be
entitled to apply to such payment, Cash Collateral in an equal amount to the amount of such
payment.

          (d) The obligation of QRC, Borrower and Guarantors to reimburse LC Disbursements as provided
herein shall be absolute, unconditional and irrevocable, and shall be performed strictly in
accordance with the terms of this Agreement and any Reimbursement Agreement under any and all
circumstances whatsoever and irrespective of (i) any lack of validity or enforceability of an
Outstanding Letter of Credit, any Reimbursement Agreement or this Agreement, or any term or
provision therein, (ii) any draft or other document presented under any Outstanding Letter of
Credit proving to be forged, fraudulent or invalid in any respect or any statement therein being
untrue or inaccurate in any respect, (iii) payment by the Letter of Credit Issuer (or Underlying
Issuer) under an Outstanding Letter of Credit against presentation of a draft or other document
that does not comply substantially with the terms of such Outstanding Letter of Credit or any
Reimbursement Agreement, or (iv) any other event or circumstance whatsoever, whether or not similar
to any of the foregoing, that might, but for the provisions herein, constitute a legal or equitable
discharge of, or provide a right of setoff against, the obligations of QRC, Borrower and Guarantors
hereunder. Neither the Letter of Credit Issuer or Underlying Issuer shall have any liability or
responsibility by reason of or in connection with the issuance or transfer of any Outstanding
Letter of Credit or any payment or failure to make any payment thereunder (irrespective of any of
the circumstances referred to in the preceding sentence), or any error, omission, interruption,
loss or delay in transmission or delivery of any

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draft, notice or other communication under or relating to any Outstanding Letter of Credit
(including any document required to make a drawing thereunder), any error in interpretation of
technical terms or any consequence arising from causes beyond the control of the Letter of Credit
Issuer or Underlying Issuer. The parties hereto expressly agree that, in the absence of gross
negligence or willful misconduct on the party of the Letter of Credit Issuer or Underlying Issuer
(as finally determined by a court of competent jurisdiction), the Letter of Credit Issuer or
Underlying Issuer shall be deemed to have exercised all requisite care in each such determination.
In furtherance of the foregoing and without limiting the generality thereof, the parties agree
that, with respect to documents presented which appear on their face to be in substantial
compliance with the terms of an Outstanding Letter of Credit, the Letter of Credit Issuer or
Underlying Issuer may, in its reasonable discretion, either accept and may payment upon such
documents without responsibility for further investigation, or refuse to accept and make payment
upon such documents if such documents are not in strict compliance with the terms of such
Outstanding Letter of Credit.

          (e) QRC, Borrower and Guarantors agree, jointly and severally, to pay (i) to the Letter of
Credit Issuer a fee with respect to Letters of Credit, which shall accrue at one and three-quarters
of one percent (1.75%) per annum (excluding any portion thereof attributable to unreimbursed LC
Disbursements which shall accrue interest at the Federal Funds Effective Rate (as defined in the
Senior Credit Agreement as in effect immediately prior to the Assignment Date) plus 1% per annum)
during the period from and including the date of this Agreement to but excluding the date on which
the Outstanding Letters of Credit are terminated and cancelled, and (ii) to the Underlying Issuer,
for its own account, its standard fees with respect to processing of drawings under any Outstanding
Letter of Credit. Interest and fees accrued through and including the last day of each month of
each year shall be payable on the third Business Day following such last day, commencing on the
first such date to occur after the date of this Agreement; provided that all such interest and fees
shall be payable on the date the Outstanding Letters of Credit are terminated and cancelled and any
such interest and fees accruing after such date shall be payable on demand. If QRC, Borrower and
Guarantors fail to pay any such interest or fee when due, in addition to any rights Letter of
Credit Issuer and Underlying Issuer may have hereunder, under any Reimbursement Agreement and
applicable law, Letter of Credit Issuer shall be entitled to apply to such payment, Cash Collateral
in an equal amount to the amount of such payment.

          (f) As collateral security for the obligations of QRC, Borrower and Guarantors under this
Agreement and any Reimbursement Agreement in connection with the Outstanding Letters of Credit,
each of QRC, Borrower and each Guarantor hereby grants to the Letter of Credit Issuer a continuing
security interest in the Cash Collateral. Each of QRC, Borrower and each Guarantor acknowledges
and agrees that the Letter of Credit Issuer may exercise and enforce with respect to the Cash
Collateral, in addition to all rights and remedies otherwise available to the Letter of Credit
Issuer, all rights and remedies available to a secured party under the Uniform Commercial Code in
effect in the State of New York. Each of QRC, Borrower and each Guarantor agrees that it will, at
any time and from time to time, promptly execute and deliver all further instruments and documents
and take all further action that may be necessary or that the Letter of Credit Issuer may
reasonably request in order (i) to perfect and protect the security interests in the Cash
Collateral created or purported to be created hereby and

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the first priority of such security interests; (ii) to enable the Letter of Credit Issuer to
exercise and enforce its rights and remedies hereunder and under the Uniform Commercial Code in
effect in the State of New York in respect of the Cash Collateral; or (iii) to otherwise effect the
purposes of this Agreement, including authorizing and filing such financing or continuation
statements, or amendments thereto, as may be necessary or that the Letter of Credit Issuer may
reasonably request in order to perfect and preserve the security interests in the Cash Collateral
created or purported to be created hereby.

          (g) The Borrower hereby covenants and agrees that it will use reasonable efforts to induce
each beneficiary of an original Outstanding Letters of Credit to accept a replacement Letter of
Credit issued under the New Credit Agreement. The Borrower acknowledges and agrees that the
Underlying Issuer shall provide notice to the beneficiaries of the Outstanding Letters of Credit
that the Outstanding Letters of credit will not be automatically extended.

          (h) The Letter of Credit Issuer hereby covenants and agrees that, upon receipt and
cancellation of all Outstanding Letters of Credit, it will promptly return to the Borrower any
remaining Cash Collateral after satisfaction of all obligations of QRC, Borrower and Guarantors
with respect to the Outstanding Letters of Credit.

          (i) The Letter of Credit Issuer shall have no obligation to invest or pay interest on the Cash
Collateral and the Cash Collateral may be commingled with Letter of Credit Issuer’s other funds.

     9. Preservation of Liens and Security Interests. Nothing contained herein shall be
deemed to release, modify or impair the liens or security interests in the Collateral comprising
the Assigned Rights in any respect, all of which shall continue to secure the obligations and
indebtedness under the New Credit Agreement, including, without limitation, the Obligations (as
defined in the New Credit Agreement) and all of which liens and security interests are hereby
ratified and confirmed. QRC and Borrower hereby acknowledge that the New Credit Agreement
represents a renewal, extension, amendment and modification of the Existing Debt, but does not
represent a satisfaction or novation thereof.

     10. Miscellaneous. This Agreement shall be governed by and construed under the laws of
the State of New York and shall be binding upon and inure to the benefit of the parties hereto and
their successors and assigns. This Agreement may be executed in any number of counterparts, each of
which shall be an original, but all of which together shall constitute one instrument. Facsimiles
shall be effective as originals.

     11. JURY WAIVER. THE PARTIES HERETO HEREBY WAIVE, TO THE FULLEST EXTENT PERMITTED BY
APPLICABLE LAW, ANY AND ALL RIGHT TO TRIAL BY JURY IN ANY LEGAL PROCEEDINGS ARISING OUT OF OR
RELATED TO THIS AGREEMENT OR THE TRANSACTIONS CONTEMPLATED HEREBY.

[Signature Page to Follow]

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          IN WITNESS WHEREOF, this Waiver and Amendment has been duly executed as of the day and year
first above written.

	 	 	 	 	 	 	 
	BORROWER:	 	QUEST CHEROKEE, LLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Jerry D. Cash	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Jerry D. Cash,	 	 
	 

	 	 	 	Chief Executive Officer	 	 
	 
	 	 	 	 	 	 
	QRC:	 	QUEST RESOURCE CORPORATION
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Jerry D. Cash	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Jerry D. Cash,	 	 
	 

	 	 	 	Chief Executive Officer	 	 
	 
	 	 	 	 	 	 
	GUARANTORS:	 	QUEST CHEROKEE OILFIELD SERVICE, LLC
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Jerry D. Cash	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Jerry D. Cash,	 	 
	 

	 	 	 	Chief Executive Officer	 	 
	 
	 	 	 	 	 	 
	 	 	QUEST OIL & GAS CORPORATION
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Jerry D. Cash	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Jerry D. Cash,	 	 
	 

	 	 	 	Chief Executive Officer	 	 
	 
	 	 	 	 	 	 
	 	 	QUEST ENERGY SERVICE, INC.
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Jerry D. Cash	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	Jerry D. Cash,	 	 
	 

	 	 	 	Chief Executive Officer	 	 

Quest Loan

Transfer Agreement

Signature page 1

 

	 	 	 	 	 	 	 
	SENIOR AGENT:	 	GUGGENHEIM CORPORATE FUNDING,  
	 	 	LLC, as Administrative Agent, Syndication Agent,
	 	 	Sole Lead Arranger and Sole Bookrunner
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Todd L. Boehly	 	 
	 

	 	 	 	 	 	 
	 	 	Name:  Todd
L. Boehly	 	 
	 	 	Title:    Managing
Partner	 	 
	 
	 	 	 	 	 	 
	SENIOR LENDER:	 	WELLS FARGO FOOTHILL, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Gary Forlenza	 	 
	 

	 	 	 	 	 	 
	 	 	Name:  Gary Forlenza	 	 
	 	 	Title:    VP	 	 
	 
	 	 	 	 	 	 
	SENIOR LENDER:	 	MIDLAND NATIONAL LIFE INSURANCE COMPANY
	 
	 	 	 	 	 	 
	 	 	By: Guggenheim Partners Advisory Company as Manager
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Michael Damaso	 	 
	 

	 	 	 	 	 	 
	 	 	Name:  Michael Damaso	 	 
	 	 	Title:    Senior
Managing Director	 	 
	 
	 	 	 	 	 	 
	SENIOR LENDER:	 	NORTH AMERICAN COMPANY FOR LIFE AND HEALTH INSURANCE
	 
	 	 	 	 	 	 
	 	 	By: Guggenheim Partners Advisory Company	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Michael Damaso	 	 
	 

	 	 	 	 	 	 
	 	 	Name:  Michael Damaso	 	 
	 	 	Title:    Senior
Managing Director	 	 

Quest Loan

Transfer Agreement

Signature page 2

 

	 	 	 	 	 	 	 
	SENIOR LENDER:	 	MASSACHUSETTS MUTUAL LIFE INSURANCE COMPANY  
	 
	 	 	 	 	 	 
	 	 	By: Babson Capital Management LLC as Investment Adviser
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Arthur J. McMahon	 	 
	 

	 	 	 	 	 	 
	 	 	Name:  Arthur J. McMahon	 	 
	 	 	Title:    Director	 	 
	 
	 	 	 	 	 	 
	SENIOR LENDER:	 	ORPHEUS HOLDINGS LIMITED	 	 
	 
	 	 	 	 	 	 
	 	 	By: Guggenheim Investment Management, LLC as Manager
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Stephen D. Sautel	 	 
	 

	 	 	 	 	 	 
	 	 	Name:  Stephen D. Sautel	 	 
	 	 	Title:    Senior
Managing Director	 	 
	 
	 	 	 	 	 	 
	SENIOR LENDER:	 	ORPHEUS FUNDING LLC	 	 
	 
	 	 	 	 	 	 
	 	 	By: Guggenheim Investment Management, LLC as Manager
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Stephen D. Sautel	 	 
	 

	 	 	 	 	 	 
	 	 	Name:  Stephen D. Sautel	 	 
	 	 	Title:    Senior
Managing Director	 	 
	 
	 	 	 	 	 	 
	SENIOR LENDER:	 	KENNECOTT FUNDING LTD.	 	 
	 
	 	 	 	 	 	 
	 	 	By: Guggenheim Investment Management, LLC as Collateral

Manager
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Stephen D. Sautel	 	 
	 

	 	 	 	 	 	 
	 	 	Name:  Stephen D. Sautel	 	 
	 	 	Title:    Senior
Managing Director	 	 

Quest Loan

Transfer Agreement

Signature page 3

 

	 	 	 	 	 	 	 
	SENIOR LENDER:	 	SANDS POINT FUNDING LTD.  
	 
	 	 	 	 	 	 
	 	 	By: Guggenheim Investment Management, LLC as Collateral

Manager
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Stephen D. Sautel	 	 
	 

	 	 	 	 	 	 
	:

	 	Name:	 	Stephen D. Sautel	 	 
	 	 	Title:	 	Senior Managing Director	 
	 
	 	 	 	 	 	 
	SENIOR LENDER:	 	COPPER RIVER CLO LTD.
	 
	 	 	 	 	 	 
	 	 	By: Guggenheim Investment Management, LLC as Manager
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Stephen D. Sautel	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	Stephen D. Sautel	 	 
	 	 	Title:	 	Senior Managing Director
	 
	 	 	 	 	 	 
	SENIOR LENDER:	 	GREEN LANE CLO LTD.
	 
	 	 	 	 	 	 
	 	 	By: Guggenheim Investment Management, LLC as Manager
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Stephen D. Sautel	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	Stephen D. Sautel	 	 
	 	 	Title:	 	Senior Managing Director
	 
	 	 	 	 	 	 
	SENIOR LENDER:	 	BABSON MID-MARKET CLO LTD. 2007-II
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Arthur J. McMahon	 	 
	 

	 	 	 	 	 	 
	 	 	Name:	 	Arthur J. McMahon
	 	 	Title:	 	Director
	 
	 	 	 	 	 	 

Quest Loan

Transfer Agreement

Signature page 4

 

	 	 	 	 	 	 	 
	SECOND LIEN AGENT:	 	GUGGENHEIM CORPORATE FUNDING,  
	 	 	LLC, as Administrative Agent, Syndication Agent,	 	 
	 	 	Sole Lead Arranger and Sole Bookrunner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Todd L. Boehly	 	 
	 

	 	 	 	 	 	 
	 	 	Name:  Todd L. Boehly	 	 
	 	 	Title:    Managing
Partner	 	 
	 
	 	 	 	 	 	 
	SECOND LIEN LENDER:	 	MASSACHUSETTS MUTUAL LIFE INSURANCE COMPANY
	 
	 	 	 	 	 	 
	 	 	By: Babson Capital Management LLC as Investment

Adviser
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Arthur J. McMahon	 	 
	 

	 	 	 	 	 	 
	 	 	Name:  Arthur J. McMahon	 	 
	 	 	Title:    Director	 	 
	 
	 	 	 	 	 	 
	SECOND LIEN LENDER:	 	DEL MAR MASTER FUND LTD.
	 
	 	 	 	 	 	 
	 	 	By: Del Mar Asset Management, L.P.
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Marc V. Simons	 	 
	 

	 	 	 	 	 	 
	 	 	Name:  Marc V. Simons	 	 
	 	 	Title:    Director	 	 
	 
	 	 	 	 	 	 
	SECOND LIEN LENDER:	 	BABSON MID-MARKET CLO LTD. 2007-II
	 
	 	 	 	 	 	 
	 

	 	By:
	 	/s/ Arthur J. McMahon	 	 
	 

	 	 	 	 	 	 
	 	 	Name:  Arthur J. McMahon	 	 
	 	 	Title:    Director	 	 

Quest Loan

Transfer Agreement

Signature page 5

 

	 	 	 	 	 	 	 
	SECOND LIEN LENDER:	 	SPF CDO I, LLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Richard Petrilli	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	Richard Petrilli	 	 
	 

	 	Title:	 	Authorized Signatory	 	 
	 
	 	 	 	 	 	 
	SECOND LIEN LENDER:	 	FIELD POINT II, LTD.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Richard Petrilli	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	Richard Petrilli	 	 
	 

	 	Title:	 	Authorized Signatory	 	 
	 
	 	 	 	 	 	 
	SECOND LIEN LENDER:	 	FIELD POINT IV, LTD	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Richard Petrilli	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	Richard Petrilli	 	 
	 

	 	Title:	 	Authorized Signatory	 	 
	 
	 	 	 	 	 	 
	SECOND LIEN LENDER:	 	FIELD POINT III, LTD	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Richard Petrilli	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	Richard Petrilli	 	 
	 

	 	Title:	 	Authorized Signatory	 	 
	 
	 	 	 	 	 	 
	SECOND LIEN LENDER:
	 	WELLS FARGO ENERGY CAPITAL, INC.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ William B. Wiener III	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	William B. Wiener III	 	 
	 

	 	Title:	 	S.V.P.	 	 

Quest Loan

Transfer Agreement

Signature Page 6 

 

	 	 	 	 	 	 	 
	SECOND LIEN LENDER:	 	DELLACAMERA CAPITAL MASTER FUND, LTD.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Andrew Kurtz	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	Andrew Kurtz	 	 
	 

	 	Title:	 	Managing Member	 	 
	 
	 	 	 	 	 	 
	SECOND LIEN LENDER:	 	ORPHEUS HOLDINGS LIMITED	 	 
	 
	 	 	 	 	 	 
	 	 	By: Guggenheim Investment Management, LLC as its Manager	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Stephen D. Sautel	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	Stephen D. Sautel	 	 
	 

	 	Title:	 	Senior Managing Director	 	 
	 
	 	 	 	 	 	 
	SECOND LIEN LENDER:	 	ORPHEUS FUNDING LLC	 	 
	 
	 	 	 	 	 	 
	 	 	By: Guggenheim Investment Management, LLC as its Manager	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Stephen D. Sautel	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	Stephen D. Sautel	 	 
	 

	 	Title:	 	Senior Managing Director	 	 
	 
	 	 	 	 	 	 
	SECOND LIEN LENDER:	 	DEUTSCHE BANK AG NEW YORK BRANCH	 	 
	 
	 	 	 	 	 	 
	 	 	By: DB Services New Jersey, Inc.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Deborah O’Keeffe	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	Deborah O’Keeffe	 	 
	 

	 	Title:	 	Vice President	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Claudia Roda	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	Claudia Roda	 	 
	 

	 	Title:	 	Authorized Signatory	 	 

Quest Loan

Transfer Agreement

Signature Page 7 

 

	 	 	 	 	 	 	 
	THIRD LIEN AGENT:	 	GUGGENHEIM CORPORATE FUNDING,

LLC, as Administrative Agent, Syndication Agent,

Sole Lead Arranger and Sole Bookrunner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Todd L. Boehly	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	Todd L. Boehly	 	 
	 

	 	Title:	 	Managing Partner	 	 
	 
	 	 	 	 	 	 
	THIRD LIEN LENDER:	 	MA DEEP EVENT, LTD	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Jeffrey Golbus	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	Jeffrey Golbus	 	 
	 

	 	Title:	 	Assistant Portfolio Manager	 	 
	 
	 	 	 	 	 	 
	THIRD LIEN LENDER:	 	COPPER RIVER CLO LTD.	 	 
	 
	 	 	 	 	 	 
	 	 	By: Guggenheim Investment Management, LLC 

as Manager	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Stephen D. Sautel	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	Stephen D. Sautel	 	 
	 

	 	Title:	 	Senior Managing Director	 	 
	 
	 	 	 	 	 	 
	THIRD LIEN LENDER:	 	ORPHEUS HOLDINGS LIMITED	 	 
	 
	 	 	 	 	 	 
	 	 	By: Guggenheim Investment Management, LLC 

as its Manager	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Stephen D. Sautel	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	Stephen D. Sautel	 	 
	 

	 	Title:	 	Senior Managing Director	 	 

Quest Loan

Transfer Agreement

Signature Page 8 

 

	 	 	 	 	 	 	 
	THIRD LIEN LENDER:	 	KENNECOTT FUNDING LTD.	 	 
	 
	 	 	 	 	 	 
	 	 	By: Guggenheim Investment Management, LLC 

as Collateral Manager	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Stephen D. Sautel	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	Stephen D. Sautel	 	 
	 

	 	Title:	 	Senior Managing Director	 	 
	 
	 	 	 	 	 	 
	THIRD LIEN LENDER:	 	SANDS POINT FUNDING LTD.	 	 
	 
	 	 	 	 	 	 
	 	 	By: Guggenheim Investment Management, LLC 

as Collateral Manager	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Stephen D. Sautel	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	Stephen D. Sautel	 	 
	 

	 	Title:	 	Senior Managing Director	 	 
	 
	 	 	 	 	 	 
	THIRD LIEN LENDER:	 	ORPHEUS FUNDING LLC	 	 
	 
	 	 	 	 	 	 
	 	 	By: Guggenheim Investment Management, LLC 

as Manager	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Stephen D. Sautel	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	Stephen D. Sautel	 	 
	 

	 	Title:	 	Senior Managing Director	 	 
	 
	 	 	 	 	 	 
	THIRD LIEN LENDER:	 	DEL MAR MASTER FUND LTD.	 	 
	 
	 	 	 	 	 	 
	 	 	By: Del Mar Asset Management, L.P.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Marc V. Simons	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	Marc V. Simons	 	 
	 

	 	Title:	 	Director	 	 

Quest Loan

Transfer Agreement

Signature Page 9 

 

	 	 	 	 	 	 	 
	THIRD LIEN LENDER:	 	GRAND CENTRAL ASSET TRUST, DHV SERIES	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Pam Gwin	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	Pam Gwin	 	 
	 

	 	Title:	 	Attorney-in-fact	 	 
	 
	 	 	 	 	 	 
	THIRD LIEN LENDER:	 	NZC OPPORTUNITIES LLC	 	 
	 
	 	 	 	 	 	 
	 	 	By: Guggenheim Investment Management, LLC 

as Manager	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Stephen D. Sautel	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	Stephen D. Sautel	 	 
	 

	 	Title:	 	Senior Managing Director	 	 
	 
	 	 	 	 	 	 
	THIRD LIEN LENDER:	 	NZC OPPORTUNITIES (FUNDING) II LIMITED	 	 
	 
	 	 	 	 	 	 
	 	 	By: Guggenheim Investment Management, LLC 

as Manager	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Stephen D. Sautel	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	Stephen D. Sautel	 	 
	 

	 	Title:	 	Senior Managing Director	 	 
	 
	 	 	 	 	 	 
	THIRD LIEN LENDER:	 	GREEN LANE CLO LTD.	 	 
	 
	 	 	 	 	 	 
	 	 	By: Guggenheim Investment Management, LLC 

as Manager	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Stephen D. Sautel	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	Stephen D. Sautel	 	 
	 

	 	Title:	 	Senior Managing Director	 	 

Quest Loan

Transfer Agreement

Signature Page 10 

 

	 	 	 	 	 	 	 
	THIRD LIEN LENDER:	 	CLAYMORE/GUGGENHEIM STRATEGIC OPPORTUNITIES FUND	 	 
	 
	 	 	 	 	 	 
	 	 	By: Guggenheim Partners Asset Management, Inc.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Roy Corr	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	Roy Corr	 	 
	 

	 	Title:	 	Senior Managing Director	 	 
	 
	 	 	 	 	 	 
	THIRD LIEN LENDER:	 	INTEL CORPORATION PROFIT SHARING RETIREMENT PLAN	 	 
	 
	 	 	 	 	 	 
	 	 	By: Guggenheim Partners Asset Management, Inc.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Roy Corr	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	Roy Corr	 	 
	 

	 	Title:	 	Senior Managing Director	 	 
	 
	 	 	 	 	 	 
	THIRD LIEN LENDER:	 	NEW YORK LIFE INSURANCE AND ANNUITY CORPORATION	 	 
	 
	 	 	 	 	 	 
	 	 	By: Guggenheim Partners Asset Management, Inc.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ Roy Corr	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	Roy Corr	 	 
	 

	 	Title:	 	Senior Managing Director	 	 

Quest Loan

Transfer Agreement

Signature Page 11 

 

	 	 	 	 	 	 	 
	THIRD LIEN LENDER:	 	WHITEBOX HEDGED HIGH YIELD PARTNERS, L.P.	 	 
	 
	 	 	 	 	 	 
	 	 	By: Whitebox Hedged High Yield Advisors, L.L.C.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 /s/  Jonathan Wood	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	Jonathan Wood	 	 
	 

	 	Title:	 	 Director - COO	 	 
	 
	 	 	 	 	 	 
	 	 	By: Whitebox Advisors, L.L.C.	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/  Jonathan Wood	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	Jonathan Wood	 	 
	 

	 	Title:	 	Director - COO	 	 
	 
	 	 	 	 	 	 
	THIRD LIEN LENDER:	 	GPC LIX, LLC	 	 
	 
	 	 	 	 	 	 
	 	 	By: Guggenheim Advisors, LLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/  Jonathan Wood	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	Jonathan Wood	 	 
	 

	 	Title:	 	Director - COO	 	 
	 
	 	 	 	 	 	 
	 	 	By: Whitebox Advisors, LLC	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/  Jonathan Wood	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	Jonathan Wood	 	 
	 

	 	Title:	 	Director - COO	 	 

Quest Loan

Transfer Agreement

Signature Page 12 

 

	 	 	 	 	 	 	 
	NEW AGENT:	 	ROYAL BANK OF CANADA,

As Administrative Agent and Collateral Agent for the New Lenders	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/  Gail Watkin	 	 
	 

	 	 	 	 	 	 
	 

	 	Name:	 	Gail Watkin	 	 
	 

	 	Title:	 	Manager, Agency	 	 
	 
	 	 	 	 	 	 
	NEW LENDER:	 	ROYAL BANK OF CANADA,	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/  Jason York	 	 
	 

	 	 	 	 	 	 
	 

	 	 	 	     Jason York

     Authorized Signatory	 	 

Quest Loan

Transfer Agreement

Signature Page 13 

 

EXHIBIT A

Reserved

Quest Loan

Transfer Agreement

Exhibit A-3

 

 

EXHIBIT B

EXISTING LOAN DOCUMENTS

	1.	 	Senior Credit Agreement
	 
	2.	 	Second Lien Term Loan Agreement
	 
	3.	 	Third Lien Term Loan Agreement
	 
	4.	 	Existing Mortgages
	 
	5.	 	Guaranty Agreements
	 
	6.	 	Security Agreements

Quest Loan

Transfer Agreement

Exhibit B

 

EXHIBIT C

OUTSTANDING SWAP AGREEMENTS

None.

Quest Loan

Transfer Agreement

Exhibit C

 

EXHIBIT D

WIRING INSTRUCTIONS

Payment of any amount to the Senior Agent, Second Lien Agent and Third Lien Agent should be made by
a wire transfer of immediately available funds directed as follows:

Wiring Instructions

Bank Name: Fifth Third Bank

ABA #: 042-000-314

Account No.: 07233849665

Account Name: Guggenheim Corporate Funding LLC

Payment of any amount in respect of legal fees to Sidley Austin LLP in connection with the Senior,
Second Lien Term Loan Agreement and Third Lien Term Loan Agreement should be made by a wire
transfer of immediately available funds directed as follows:

Wiring Instructions

Sidley Austin LLP

Bank Name: JPMorgan Chase Bank, NA

ABA #: 071000013

Account No.: 5519624

Account Name: 5519624

Swift Code: CHASUS33XXX

Payment of any amount to the Letter of Credit Issuer in respect of Cash Collateral should be made
by a wire transfer of immediately available funds directed as follows:

Wiring Instructions

Bank Name: JPMorgan Chase Bank

                                        New York, New York

ABA #: 021000021

Credit to: Wells Fargo Foothill, Inc.

Account No.: 323-266193

Re: Quest Resource

Swift Code: CHASUS33

Quest Loan

Transfer Agreement

Exhibit D Page 1

 

EXHIBIT E

PURCHASE PRICE

	 	 	 	 	 
	Senior Credit Agreement
	 	 	 	 
	 
	 	 	 	 
	Principal (Term)
	 	$	50,000,000.00	 
	Interest (Term)
	 	$	305,861.11	 
	Principal (Revolver)
	 	$	35,000,000.00	 
	Interest (Revolver)
	 	$	366,024.83	 
	 
	 	 	 
	Total:
	 	$	85,671,885.94	 
	 
	 	 	 	 
	Second Lien Term Loan Agreement
	 	 	 	 
	 
	 	 	 	 
	Principal
	 	$	100,000,000.00	 
	Interest
	 	$	427,500.00	 
	Prepayment Premium
	 	$	2,250,000.00	 
	 
	 	 	 
	Total:
	 	$	102,677,500.00	 
	 
	 	 	 	 
	Third Lien Term Loan Agreement
	 	 	 	 
	 
	 	 	 	 
	Principal
	 	$	75,000,000.00	 
	Interest
	 	$	398,750.00	 
	Prepayment Premium
	 	$	1,875,000.00	 
	 
	 	 	 
	Total:
	 	$	77,273,750.00	 
	 
	 	 	 	 
	Legal Fees
	 	$	44,275.31	 
	 
	 	 	 	 
	Servicing Fee
	 	$	25,000.00	 
	 
	 	 	 	 
	TOTAL PURCHASE PRICE
	 	$	265,692,411.25	 
	 
	 	 	 

Quest Loan

Transfer Agreement

Exhibit F

 

EXHIBIT F

OUTSTANDING LETTERS OF CREDIT

	 	 	 	 	 	 	 
	LC Amount

	 	Beneficiary
	 	LC Number
	 	Expiry Date
	$1,000,000.00
	 	Devon Energy
Company 
and Tall
Grass Services

LLC
	 	NZS564784
	 	January 1, 2007
subject to

automatic extension
	$200,000.00
	 	Victore Insurance

Company
	 	NZS564785
	 	July 7, 2006
subject to

automatic extension
but not 
beyond July
7, 2009

Quest Loan

Transfer Agreement

Exhibit F

 

EXHIBIT G

MORTGAGE DOCUMENTS

	1.	 	Mortgage, Deed of Trust, Security Agreement, Financing Statement and Assignment of Production
dated November 14, 2005 from Quest Cherokee, LLC, as Mortgagor to Guggenheim Corporate
Funding, LLC, as Collateral Agent for Secured Parties, as Mortgagee recorded in Chautauqua
County, KA on November 14, 2005 in Book 129, Page 442.
	 
	2.	 	First Amendment to Mortgage, Deed of Trust, Security Agreement, Financing Statement and
Assignment of Production dated July 31, 2006 from Quest Cherokee, LLC, as Mortgagor to
Guggenheim Corporate Funding, LLC, as Collateral Agent for Secured Parties, as Mortgagee
recorded in Chautauqua County, KA on August 10, 2006 in Book 132, Page 715.
	 
	3.	 	Mortgage, Deed of Trust, Security Agreement, Financing Statement and Assignment of Production
dated November 14, 2005 from Quest Cherokee, LLC, as Mortgagor to Guggenheim Corporate
Funding, LLC, as Collateral Agent for Secured Parties, as Mortgagee recorded in Elk County, KA
on November 14, 2005 in Book 114, Page 700.
	 
	4.	 	First Amendment to Mortgage, Deed of Trust, Security Agreement, Financing Statement and
Assignment of Production dated July 31, 2006 from Quest Cherokee, LLC, as Mortgagor to
Guggenheim Corporate Funding, LLC, as Collateral Agent for Secured Parties, as Mortgagee
recorded in Elk County, KA on August 10, 2006 in Book 115, Page 637.
	 
	5.	 	Mortgage, Deed of Trust, Security Agreement, Financing Statement and Assignment of Production
dated November 14, 2005 from Quest Cherokee, LLC, as Mortgagor to Guggenheim Corporate
Funding, LLC, as Collateral Agent for Secured Parties, as Mortgagee recorded in Labette
County, KA on November 14, 2005 in Book 358, Page 26, Document #0022983.
	 
	6.	 	First Amendment to Mortgage, Deed of Trust, Security Agreement, Financing Statement and
Assignment of Production dated July 31, 2006 from Quest Cherokee, LLC, as Mortgagor to
Guggenheim Corporate Funding, LLC, as Collateral Agent for Secured Parties, as Mortgagee
recorded in Labette County, KA on August 16, 2006 in Book 368, Page 46, Document #0026263.
	 
	7.	 	Mortgage, Deed of Trust, Security Agreement, Financing Statement and Assignment of Production
dated November 14, 2005 from Quest Cherokee, LLC, as Mortgagor to Guggenheim Corporate
Funding, LLC, as Collateral Agent for Secured Parties, as Mortgagee recorded in Montgomery
County, KA on November 14, 2005 in Book 553, Page 81.
	 
	8.	 	First Amendment to Mortgage, Deed of Trust, Security Agreement, Financing Statement

Quest Loan

Transfer Agreement

 Exhibit G Page 1

 

 

	 	 	and Assignment of Production dated July 31, 2006 from Quest Cherokee, LLC, as Mortgagor to
Guggenheim Corporate Funding, LLC, as Collateral Agent for Secured Parties, as Mortgagee
recorded in Montgomery County, KA on August 16, 2006 in Book 559, Page 684.
	 
	9.	 	Mortgage, Deed of Trust, Security Agreement, Financing Statement and Assignment of Production
dated November 14, 2005 from Quest Cherokee, LLC, as Mortgagor to Guggenheim Corporate
Funding, LLC, as Collateral Agent for Secured Parties, as Mortgagee recorded in Neosho County,
KA on November 14, 2005 in Volume 358, Page 1.
	 
	10.	 	First Amendment to Mortgage, Deed of Trust, Security Agreement, Financing Statement and
Assignment of Production dated July 31, 2006 from Quest Cherokee, LLC, as Mortgagor to
Guggenheim Corporate Funding, LLC, as Collateral Agent for Secured Parties, as Mortgagee
recorded in Neosho County, KA on August 15, 2006 in Book 374, Page 1.
	 
	11.	 	Mortgage, Deed of Trust, Security Agreement, Financing Statement and Assignment of Production
dated November 14, 2005 from Quest Cherokee, LLC, as Mortgagor to Guggenheim Corporate
Funding, LLC, as Collateral Agent for Secured Parties, as Mortgagee recorded in Wilson County,
KA on November 14, 2005 in Book 290, Page 258.
	 
	12.	 	First Amendment to Mortgage, Deed of Trust, Security Agreement, Financing Statement and
Assignment of Production dated July 31, 2006 from Quest Cherokee, LLC, as Mortgagor to
Guggenheim Corporate Funding, LLC, as Collateral Agent for Secured Parties, as Mortgagee
recorded in Wilson County, KA on August 9, 2006 in Book 300, Page 275.
	 
	13.	 	Mortgage, Deed of Trust, Security Agreement, Financing Statement and Assignment of Production
dated November 14, 2005 from Quest Cherokee, LLC, as Mortgagor to Guggenheim Corporate
Funding, LLC, as Collateral Agent for Secured Parties, as Mortgagee recorded in Woodson
County, KA on November 14, 2005 in Book 99, Page 198.
	 
	14.	 	First Amendment to Mortgage, Deed of Trust, Security Agreement, Financing Statement and
Assignment of Production dated July 31, 2006 from Quest Cherokee, LLC, as Mortgagor to
Guggenheim Corporate Funding, LLC, as Collateral Agent for Secured Parties, as Mortgagee
recorded in Woodson County, KA on August 10, 2006 in Book 100, Page 485.
	 
	15.	 	Mortgage, Deed of Trust, Security Agreement, Financing Statement and Assignment of Production
dated November 14, 2005 from Quest Cherokee, LLC, as Mortgagor to Guggenheim Corporate
Funding, LLC, as Collateral Agent for Secured Parties, as Mortgagee recorded in Nowata County,
OK on November 14, 2005 in Book 0737, Page 1.

Quest Loan

Transfer Agreement

Exhibit G Page 2

 

 

	16.	 	First Amendment to Mortgage, Deed of Trust, Security Agreement, Financing Statement and
Assignment of Production dated July 31, 2006 from Quest Cherokee, LLC, as Mortgagor to
Guggenheim Corporate Funding, LLC, as Collateral Agent for Secured Parties, as Mortgagee
recorded in Nowata County, OK on August 10, 2006 in Book 0744, Page 1.
	 
	17.	 	Mortgage, Deed of Trust, Security Agreement, Financing Statement and Assignment of Production
dated November 14, 2005 from Quest Cherokee, LLC, as Mortgagor to Guggenheim Corporate
Funding, LLC, as Collateral Agent for Secured Parties, as Mortgagee recorded in Craig County,
OK on November 14, 2005 in Book 0546, Page 665.
	 
	18.	 	First Amendment to Mortgage, Deed of Trust, Security Agreement, Financing Statement and
Assignment of Production dated July 31, 2006 from Quest Cherokee, LLC, as Mortgagor to
Guggenheim Corporate Funding, LLC, as Collateral Agent for Secured Parties, as Mortgagee
recorded in Craig County, OK on August 10, 2006 in Book 555, Page 729.

Quest Loan

Transfer Agreement

Exhibit G Page 3

 

 

EXHIBIT H

Reserved.

Quest Loan

Transfer Agreement

Exhibit H

 

 

Exhibit I

FORM OF ASSIGNMENT OF DEBT AND LIENS

ASSIGNMENT OF DEBT AND LIENS

     THIS ASSIGNMENT OF DEBT AND LIENS (this “Assignment”) is made as of November 15, 2007 by
GUGGENHEIM CORPORATE FUNDING, LLC, as collateral agent for the Secured Parties (defined below)
(“Assignor”), with an address of 135 East 57th Street, 23rd Floor, New York, New York 10022, to
ROYAL BANK OF CANADA, as administrative agent and collateral agent (in such capacities referred to
herein as “Assignee”), with an address of Royal Bank Plaza, P.O. Box 50, 200 Bay Street, 12th
Floor, South Tower, Toronto, Ontario MSJ 2W7.

R E C I T A L S

     A. Pursuant to the terms of that certain Loan Transfer Agreement dated as of even date
herewith (the “Loan Transfer Agreement”) among QUEST RESOURCE CORPORATION, a Nevada
corporation (“QRC”), QUEST CHEROKEE, LLC, a Delaware limited liability company
(“Borrower”), Quest Oil & Gas Corporation (“QO&G”), Quest Energy Service, Inc.
(“QES”) and Quest Cherokee Oilfield Service, LLC (“QCOS”; QO&G, QES and QCOS
collectively the “Guarantors”), GUGGENHEIM CORPORATE FUNDING, LLC, as administrative agent
for the Senior Lenders (as defined in the Loan Transfer Agreement) under the Senior Credit
Agreement (as defined in the Loan Transfer Agreement), GUGGENHEIM CORPORATE FUNDING, LLC, as
administrative agent for the Second Lien Lenders (as defined in the Loan Transfer Agreement) under
the Second Lien Term Loan Agreement (as defined in the Loan Transfer Agreement), GUGGENHEIM
CORPORATE FUNDING, LLC, as administrative agent for the Third Lien Lenders (as defined in the Loan
Transfer Agreement) under the Third Lien Term Loan Agreement (as defined in the Loan Transfer
Agreement), the Senior Lenders, the Second Lien Lenders, the Third Lien Lenders, WELLS FARGO
FOOTHILL, INC. as underlying issuer under the Senior Credit Agreement, GUGGENHEIM CORPORATE
FUNDING, LLC, as Collateral Agent under the Intercreditor Agreement (as defined in the Loan
Transfer Agreement) and ROYAL BANK OF CANADA, as administrative agent and collateral agent for the
New Lenders (as defined in the Loan Transfer Agreement) under the New Credit Agreement (as defined
in the Loan Transfer Agreement), and the New Lenders, upon satisfaction of certain conditions
specified in the Loan Transfer Agreement the Collateral Agent, as Assignor, is to deliver
assignments in recordable form to assign to Assignee, for the benefit of the New Lenders the
Existing Debt and the liens and security interests securing the Existing Debt created pursuant to
the mortgages described on Exhibit A hereto (the “Existing Mortgages”).

     NOW THEREFORE, in consideration of the payment by Assignee of the Purchase Price (as defined
in the Loan Transfer Agreement), for $10.00 in hand paid, the receipt of which is hereby
acknowledged, and in consideration of the premises and for the other good and valuable

Exhibit I Page 1

 

 

consideration, the receipt and sufficiency of which are hereby acknowledged, the
Assignor and Assignee hereby agree as follows:

ARTICLE I

ASSIGNMENT 

     Section 1.1 Assignment. Assignor, for good and valuable consideration to Assignor in
hand paid by Assignee, the receipt and sufficiency of which are hereby acknowledged,

     (a) Assignor hereby GRANTS, BARGAINS, SELLS, ASSIGNS, TRANSFERS AND CONVEYS to
Assignee, without recourse or warranty or representation, express or implied, statutory or
otherwise by Assignor, all of Assignor’s and each Existing Lender’s (as defined in the Loan
Transfer Agreement) rights, titles and interests in and to the Existing Debt (as defined in
the Loan Transfer Agreement) and the Existing Loan Documents (as defined in the Loan
Transfer Agreement) and the benefit of the liens created by, or arising under, the Existing
Mortgages (collectively, the “Assigned Rights”).

     TO HAVE AND TO HOLD the Assigned Rights unto Assignee, its successors and assigns, forever;
provided, however, Assignee does not assume and shall not be obligated to pay, perform or
discharge any claim, debt, obligation, expense or liability of Assignor or the Existing
Lenders of any kind, whether known or unknown, absolute or contingent, under the Existing
Loan Documents or otherwise, arising out of any act or omission occurring on or before the
date hereof under the Existing Loan Documents.

     Section 1.2 Acceptance. Assignee, by filing and recording this Assignment in one or
more of the counties referred to on Exhibit A, indicates its acknowledgment and acceptance of the
terms hereof.

ARTICLE II

MISCELLANEOUS

     Section 2.1 Exhibit A. Exhibit A is hereby incorporated into this Assignment by
reference and constitute a part of this Assignment.

     Section 2.2 Successors and Assigns. This Assignment shall be binding upon Assignor and
its successors and assigns.

     Section 2.3 Invalidity. In the event that any one or more of the provisions contained
herein shall, for any reason, be held invalid, illegal or unenforceable in any respect, such
invalidity, illegality or unenforceability shall not affect any other provisions hereof.

     Section 2.4 Counterparts. This Assignment is being executed in several counterparts,
all of which are identical. Each of such counterparts shall for all purposes be deemed to be an

Exhibit I Page 2

 

 

original and all such counterparts shall together constitute but one and the same instrument.
Executed original counterparts of this Assignment to be filed for record in the records of the
jurisdictions wherein some or all of the collateral securing the Existing Credit Facilities is
situated may have annexed thereto as Exhibit A only the portions or divisions containing specific
descriptions of the collateral located in those jurisdictions. Whenever a recorded counterpart of
this Assignment contains specific descriptions which are less than all of the descriptions
contained in any fall counterpart on file with Assignee, the omitted descriptions are hereby
included by reference in that recorded counterpart as if each recorded counterpart conformed to
arty full counterpart on file with Assignee.

     Section 2.5 Governing Law. This Assignment shall be governed by, and construed in
accordance with, the laws of the State of New York, other than the conflict of laws rules thereof.

[Remainder of Page Intentionally Blank;

Signature Pages Follow]

Exhibit I Page 3

 

 

     IN WITNESS WHEREOF, the parties have caused this Assignment to be executed by their duly
authorized officers effective as of the date first above written.

	 	 	 	 	 	 	 
	 	 	ASSIGNOR:	 	 
	 
	 	 	 	 	 	 
	 	 	GUGGENHEIM CORPORATE FUNDING, LLC,	 	 
	 	 	as Collateral Agent	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	Name:
	 	 

	 	 
	 

	 	Title:	 	 	 	 

THE STATE OF NEW YORK

COUNTY OF                     

	 	 	 
	Kansas

	 	The foregoing instrument was acknowledged before me on this ___day of November, 2007 by
                    ,                     of Guggenheim Corporate Funding, LLC, a Delaware limited liability
company, on behalf of said limited liability company.
	 
	 	 
	Oklahoma

	 	The foregoing instrument was acknowledged before me on this ___day of November, 2007 by
                     ,                     of Guggenheim Corporate Funding, LLC, a Delaware limited liability
company, on behalf of said limited liability company.
	 
	 	 
	 

	 	IN TESTIMONY AND WITNESS WHEREOF, I have hereunto set my hand and official seal on the day and
year first above written.
	 
	 	
              
          
          
           
          
            
     
          
	 

	 	NOTARY PUBLIC, State of New York     
     
          
	 

	 	My commission expires:
	 
	 	 
	 

	 	                                    [SEAL]

Exhibit I Page 4

 

 

Exhibit A

Existing Mortgages

	1.	 	Mortgage, Deed of Trust, Security Agreement, Financing Statement and Assignment of Production
dated November 14, 2005 from Quest Cherokee, LLC, as Mortgagor to Guggenheim Corporate
Funding, LLC, as Collateral Agent for Secured Parties, as Mortgagee recorded in Chautauqua
County, KA on November 14, 2005 in Book 129, Page 442.
	 
	2.	 	First Amendment to Mortgage, Deed of Trust, Security Agreement, Financing Statement and
Assignment of Production dated July 31, 2006 from Quest Cherokee, LLC, as Mortgagor to
Guggenheim Corporate Funding, LLC, as Collateral Agent for Secured Parties, as Mortgagee
recorded in Chautauqua County, KA on August 10, 2006 in Book 132, Page 715.
	 
	3.	 	Mortgage, Deed of Trust, Security Agreement, Financing Statement and Assignment of Production
dated November 14, 2005 from Quest Cherokee, LLC, as Mortgagor to Guggenheim Corporate
Funding, LLC, as Collateral Agent for Secured Parties, as Mortgagee recorded in Elk County, KA
on November 14, 2005 in Book 114, Page 700.
	 
	4.	 	First Amendment to Mortgage, Deed of Trust, Security Agreement, Financing Statement and
Assignment of Production dated July 31, 2006 from Quest Cherokee, LLC, as Mortgagor to
Guggenheim Corporate Funding, LLC, as Collateral Agent for Secured Parties, as Mortgagee
recorded in Elk County, KA on August 10, 2006 in Book 115, Page 637.
	 
	5.	 	Mortgage, Deed of Trust, Security Agreement, Financing Statement and Assignment of Production
dated November 14, 2005 from Quest Cherokee, LLC, as Mortgagor to Guggenheim Corporate
Funding, LLC, as Collateral Agent for Secured Parties, as Mortgagee recorded in Labette
County, KA on November 14, 2005 in Book 358, Page 26, Document #0022983.
	 
	6.	 	First Amendment to Mortgage, Deed of Trust, Security Agreement, Financing Statement and
Assignment of Production dated July 31, 2006 from Quest Cherokee, LLC, as Mortgagor to
Guggenheim Corporate Funding, LLC, as Collateral Agent for Secured Parties, as Mortgagee
recorded in Labette County, KA on August 16, 2006 in Book 368, Page 46, Document #0026263.
	 
	7.	 	Mortgage, Deed of Trust, Security Agreement, Financing Statement and Assignment of Production
dated November 14, 2005 from Quest Cherokee, LLC, as Mortgagor to Guggenheim Corporate
Funding, LLC, as Collateral Agent for Secured Parties, as Mortgagee recorded in Montgomery
County, KA on November 14, 2005 in Book 553, Page 81.
	 
	8.	 	First Amendment to Mortgage, Deed of Trust, Security Agreement, Financing Statement

Exhibit I Page 5

 

 

	 	 	and Assignment of Production dated July 31, 2006 from Quest Cherokee, LLC, as Mortgagor to
Guggenheim Corporate Funding, LLC, as Collateral Agent for Secured Parties, as Mortgagee
recorded in Montgomery County, KA on August 16, 2006 in Book 559, Page 684.
	 
	9.	 	Mortgage, Deed of Trust, Security Agreement, Financing Statement and Assignment of Production
dated November 14, 2005 from Quest Cherokee, LLC, as Mortgagor to Guggenheim Corporate
Funding, LLC, as Collateral Agent for Secured Parties, as Mortgagee recorded in Neosho County,
KA on November 14, 2005 in Volume 358, Page 1.
	 
	10.	 	First Amendment to Mortgage, Deed of Trust, Security Agreement, Financing Statement and
Assignment of Production dated July 31, 2006 from Quest Cherokee, LLC, as Mortgagor to
Guggenheim Corporate Funding, LLC, as Collateral Agent for Secured Parties, as Mortgagee
recorded in Neosho County, KA on August 15, 2006 in Book 374, Page 1.
	 
	11.	 	Mortgage, Deed of Trust, Security Agreement, Financing Statement and Assignment of Production
dated November 14, 2005 from Quest Cherokee, LLC, as Mortgagor to Guggenheim Corporate
Funding, LLC, as Collateral Agent for Secured Parties, as Mortgagee recorded in Wilson County,
KA on November 14, 2005 in Book 290, Page 258.
	 
	12.	 	First Amendment to Mortgage, Deed of Trust, Security Agreement, Financing Statement and
Assignment of Production dated July 31, 2006 from Quest Cherokee, LLC, as Mortgagor to
Guggenheim Corporate Funding, LLC, as Collateral Agent for Secured Parties, as Mortgagee
recorded in Wilson County, KA on August 9, 2006 in Book 300, Page 275.
	 
	13.	 	Mortgage, Deed of Trust, Security Agreement, Financing Statement and Assignment of Production
dated November 14, 2005 from Quest Cherokee, LLC, as Mortgagor to Guggenheim Corporate
Funding, LLC, as Collateral Agent for Secured Parties, as Mortgagee recorded in Woodson
County, KA on November 14, 2005 in Book 99, Page 198.
	 
	14.	 	First Amendment to Mortgage, Deed of Trust, Security Agreement, Financing Statement and
Assignment of Production dated July 31, 2006 from Quest Cherokee, LLC, as Mortgagor to
Guggenheim Corporate Funding, LLC, as Collateral Agent for Secured Parties, as Mortgagee
recorded in Woodson County, KA on August 10, 2006 in Book 100, Page 485.
	 
	15.	 	Mortgage, Deed of Trust, Security Agreement, Financing Statement and Assignment of Production
dated November 14, 2005 from Quest Cherokee, LLC, as Mortgagor to Guggenheim Corporate
Funding, LLC, as Collateral Agent for Secured Parties, as Mortgagee recorded in Nowata County,
OK on November 14, 2005 in Book 0737, Page 1.

Exhibit I Page 6

 

 

	16.	 	First Amendment to Mortgage, Deed of Trust, Security Agreement, Financing Statement and
Assignment of Production dated July 31, 2006 from Quest Cherokee, LLC, as Mortgagor to
Guggenheim Corporate Funding, LLC, as Collateral Agent for Secured Parties, as Mortgagee
recorded in Nowata County, OK on August 10, 2006 in Book 0744, Page 1.
	 
	17.	 	Mortgage, Deed of Trust, Security Agreement, Financing Statement and Assignment of Production
dated November 14, 2005 from Quest Cherokee, LLC, as Mortgagor to Guggenheim Corporate
Funding, LLC, as Collateral Agent for Secured Parties, as Mortgagee recorded in Craig County,
OK on November 14, 2005 in Book 0546, Page 665.
	 
	18.	 	First Amendment to Mortgage, Deed of Trust, Security Agreement, Financing Statement and
Assignment of Production dated July 31, 2006 from Quest Cherokee, LLC, as Mortgagor to
Guggenheim Corporate Funding, LLC, as Collateral Agent for Secured Parties, as Mortgagee
recorded in Craig County, OK on August 10, 2006 in Book 555, Page 729.

Exhibit I Page 7

 

 

ANNEX 1

TO LOAN TRANSFER AGREEMENT

November                     , 2007

VIA FACSIMILE

Quest Cherokee, LLC

c/o Stinson Morrison Hecker LLP

1201 Walnut

Kansas City, Missouri 64106

Facsimile: (816) 412-8174

Attention: Patrick J. Respeliers

Royal Bank of Canada

c/o Thompson & Knight LLP

333 Clay Street, Suite 3300

Houston, Texas 77002

Facsimile: (832) 397-8056

Attention: Robert C. Shearer

			
	Re:	 	Receipt of Purchase Price and Satisfaction of Conditions under Loan Transfer Agreement

Ladies and Gentlemen:

          Reference is made to that certain Loan Transfer Agreement dated as of November ___, 2007 (the
“Agreement”), among Guggenheim Corporate Funding, LLC, as the Senior Agent, the Second Lien
Agent, the Third Lien Agent, and the Collateral Agent, Royal Bank of Canada, as the New Agent, the
New Lenders party thereto, Quest Resource Corporation, Quest Cherokee, LLC, the Guarantors party
thereto, the Senior Lenders party thereto, the Second Lien Lenders party thereto and the Third Lien
Lenders party thereto, relating to, inter alia, the purchase by the Assignees from the Assignors of
the Assigned Rights. Capitalized terms used but not defined herein shall have the meanings set
forth in the Agreement. We hereby inform you that we have received the Purchase Price in
accordance with the terms of the Agreement, and the conditions precedent set forth in Section 1 of
the Agreement have been satisfied. Accordingly, the terms of the Agreement are effective. Except
as set forth in the Agreement, QRC, the Borrower and the Guarantors owe no further obligations to
the Agents or the Existing Lenders in connection with the Existing Loan Documents.

	 	 	 	 	 	 	 
	 	 	Guggenheim Corporate Funding, LLC,	 	 
	 	 	as Senior Agent, Second Lien Agent, Third Lien	 	 
	 	 	Agent and Collateral Agent	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	 	 	 
	 

	 	Name:
	 	 

	 	 
	 

	 	 	 	 	 	 
	 

	 	Title:	 	 	 	 
	 

	 	 	 	 	 	 

Annex Iexv10w9

 

Exhibit 10.9

GUARANTY

(MLP)

     THIS GUARANTY (this “Guaranty”), dated as of November 15, 2007, is made by QUEST ENERGY
PARTNERS, L.P., a Delaware limited partnership (the “Guarantor”), in favor of ROYAL BANK OF CANADA,
as administrative agent for the “Secured Parties” as defined in the Credit Agreement (hereinafter
defined).

W I T N E S S E T H:

     WHEREAS, pursuant to that certain Amended and Restated Credit Agreement dated November 15,
2007 (as the same may hereafter be amended, supplemented and restated, the “Credit Agreement”),
among QUEST RESOURCE CORPORATION, a Nevada corporation (“Quest Resource”), QUEST CHEROKEE, LLC, a
Delaware limited liability company (“Quest Cherokee” and together with Quest Resource, each a
“Borrower” and collectively, the “Borrowers”), the Guarantor, the various financial institutions
that are, or may from time to time become, parties thereto (individually a “Lender” and
collectively the “Lenders”) and Royal Bank of Canada, as administrative agent and collateral agent
(in its capacity as administrative agent, the “Administrative Agent”), the Lenders have agreed to
make Credit Extensions for the account of the Borrowers; and

     WHEREAS, as a condition precedent to the making of Credit Extensions under and as defined in
the Credit Agreement, the Guarantor is required to execute and deliver this Guaranty; and

     WHEREAS, the Guarantor has duly authorized the execution, delivery and performance of this
Guaranty; and

     WHEREAS, following consummation of the transactions contemplated by that certain Contribution,
Conveyance, and Assumption Agreement among Quest Resource, Guarantor, Quest Cherokee, Quest Energy
GP, LLC, Quest Oil & Gas, LLC and Quest Energy Service, LLC dated as of the date hereof, the
Guarantor will own all of the membership interests in Quest Cherokee and control the management of
Quest Cherokee; and

     WHEREAS, it is in the best interests of the Guarantor to execute this Guaranty inasmuch as the
Guarantor will derive substantial direct and indirect benefits from the extensions of credit made
from time to time to or for the account of the Borrowers.

     NOW THEREFORE, for good and valuable consideration, the receipt of which is hereby
acknowledged, and in order to induce the Lenders to make Credit Extensions to the Borrowers
pursuant to the Credit Agreement by fulfilling the requirements of the Credit Agreement, the
Guarantor agrees, for the benefit of each Lender, as follows:

ARTICLE I

DEFINITIONS

     SECTION 1.1 Certain Terms. The following capitalized terms when used in this Guaranty,
including its preamble and recitals, shall have the following meanings (such definitions to be
equally applicable to the singular and plural forms thereof):

     “Administrative Agent” is defined in the first recital.

MLP Guaranty

Page 1

 

 

     “Borrowers” is defined in the first recital.

     “Commitments” means each Commitment as defined in the Credit Agreement.

     “Credit Extensions” means each Credit Extension as defined in the Credit Agreement.

     “Guarantor” is defined in the preamble.

     “Guaranty” is defined in the preamble.

     “Lenders” is defined in the first recital.

     “Loan Documents” means the Loan Documents as defined in the Credit Agreement.

     “Note” means each Revolving Note as defined in the Credit Agreement.

     “Obligations” means the Obligations as defined in the Credit Agreement.

     “Obligor” means the Borrowers or any other Person (other than the Administrative Agent or any
Lender) obligated under any Loan Document.

     “Required Lenders” means the Required Lenders as defined in the Credit Agreement.

     “Taxes” is defined in clause (a) of Section 2.7.

     “UCC” means the Uniform Commercial Code as in effect in the State of New York.

     SECTION 1.2 Credit Agreement Definitions. Unless otherwise defined herein or the
context otherwise requires, capitalized terms used in this Guaranty, including its preamble and
recitals, have the meanings provided in the Credit Agreement,

     SECTION 1.3 UCC Definitions. Unless otherwise defined herein or the context otherwise
requires, terms for which meanings are provided in the UCC are used in this Guaranty, including its
preamble and recitals, with such meanings.

ARTICLE II

GUARANTY PROVISIONS

     SECTION 2.1 Guaranty. The Guarantor hereby absolutely, unconditionally, and
irrevocably (1) guarantees the full and punctual payment when due, whether at stated maturity, by
required prepayment, declaration, acceleration, demand or otherwise, of all Obligations of the
Borrowers and each other Obligor now or hereafter existing under each of the Credit Agreement, the
Notes and each other Loan Document to which the Borrowers or such other Obligor is or may become a
party, whether for principal, interest, fees, expenses or otherwise (including all such amounts
which would become due but for the operation of the automatic stay under Section 362(a) of the
United States Bankruptcy Code, 11 U.S.C. §362(a), and the operation of Sections 502(b) and 506(b)
of the United States Bankruptcy Code, 11 U.S.C. §502(b) and §506(b)), and (2) indemnifies and holds harmless each Lender and each
holder of a Note for any and all costs and expenses (including reasonable attorney’s fees and
expenses) incurred by such Lender or such holder, as the case may be, in enforcing any rights under
this Guaranty; provided however, that the Guarantor shall be liable under this Guaranty for the
maximum amount of such liability

MLP Guaranty

Page 2

 

 

that can be hereby incurred without rendering this Guaranty, as it relates to the Guarantor,
voidable under applicable law relating to fraudulent conveyance or fraudulent transfer, and not for
any greater amount. This Guaranty constitutes a guaranty of payment when due and not of collection,
and the Guarantor specifically agrees that it shall not be necessary or required that any Lender or
any holder of any Note exercise any right, assert any claim or demand or enforce any remedy
whatsoever against the Borrowers or any other Obligor (or any other Person) before or as a
condition to the obligations of the Guarantor hereunder.

     SECTION 2.2 Acceleration of Guaranty. The Guarantor agrees that, in the event of the
occurrence of any event of the type described in Section 8.01(f) of the Credit Agreement, with
respect to the Borrowers, any other Obligor or the Guarantor, and if such event shall occur at a
time when any of the Obligations may not then be due and payable, the Guarantor will pay to the
Lenders forthwith the full amount which would be payable hereunder by the Guarantor if all such
Obligations were then due and payable.

     SECTION 2.3 Guaranty Absolute, etc. This Guaranty shall in all respects be a
continuing, absolute, unconditional and irrevocable guaranty of payment, and shall remain in full
force and effect until all Obligations (other than contingent indemnity obligations) of the
Borrowers and each other Obligor have been paid in full (or, in the case of L/C Obligations, Cash
Collateralized), all obligations of the Guarantor hereunder shall have been paid in full, all
Commitments shall have terminated and, except as provided in Section 10.01(e) of the Credit
Agreement, all Lender Hedging Agreements have terminated. The Guarantor may not rescind or revoke
its obligations hereunder. The Guarantor guarantees that the Obligations of the Borrowers and each
other Obligor will be paid strictly in accordance with the terms of the Credit Agreement and each
other Loan Document under which they arise, regardless of any law, regulation or order now or
hereafter in effect in any jurisdiction affecting any of such terms or the rights of any Lender or
any holder of any Note with respect thereto. The liability of the Guarantor under this Guaranty
shall be absolute, unconditional and irrevocable irrespective of: (1) any lack of validity,
legality or enforceability of the Credit Agreement, any Note or any other Loan Document; (2) the
failure of any Lender or any holder of any Note (a) to assert any claim or demand or to enforce any
right or remedy against the Borrowers, any other Obligor or any other Person (including any other
guarantor) under the provisions of the Credit Agreement, any Note, any other Loan Document or
otherwise, or (b) to exercise any right or remedy against any other guarantor of, or collateral
securing, any Obligations of the Borrowers or any other Obligor; (3) any change in the time, manner
or place of payment of, or in any other term of, all or any of the Obligations of the Borrowers or
any other Obligor, or any other extension, compromise or renewal of any Obligations of the
Borrowers or any other Obligor; (4) any reduction, limitation, impairment or termination of any
Obligations of the Borrowers or any other Obligor for any reason, including any claim of waiver,
release, surrender, alteration or compromise, and shall not be subject to (and the Guarantor hereby
waives any right to or claim of) any defense or setoff, counterclaim, recoupment or termination
whatsoever by reason of the invalidity, illegality, nongenuineness, irregularity, compromise,
unenforceability of, or any other event or occurrence affecting, any Obligations of the Borrowers,
any other Obligor or otherwise; (5) any amendment to, rescission, waiver, or other modification of,
or any consent to departure from, any of the terms of the Credit Agreement, any Note or any other
Loan Document; (6) any addition, exchange, release, surrender or non-perfection of any collateral,
or any amendment to or waiver or release or addition of, or consent to departure from, any other
guaranty, held by any Lender or any holder of any Note securing any of the Obligations of the
Borrowers or any other Obligor; (7) the insolvency or bankruptcy of, or similar event affecting,
the Borrowers or any other Obligor; or (8) any other circumstance which might otherwise
constitute a defense available to, or a legal or equitable discharge of, the Borrowers, any
other Obligor, any surety or any guarantor. The Guarantor waives all rights and defenses which may
arise with respect

MLP Guaranty

Page 3

 

 

to any of the foregoing, and the Guarantor waives any right to revoke this Guaranty with
respect to future indebtedness.

     SECTION 2.4 Reinstatement. The Guarantor agrees that this Guaranty shall continue to
be effective or be reinstated, as the case may be, if at any time any payment (in whole or in part)
of any of the Obligations is rescinded or must otherwise be restored by any Lender or any holder of
any Note, upon the insolvency, bankruptcy or reorganization of the Borrowers, any other Obligor or
otherwise, all as though such payment had not been made.

     SECTION 2.5 Waiver, etc. The Guarantor hereby waives promptness, diligence, notice
of acceptance and any other notice with respect to any of the Obligations of the Borrowers or any
other Obligor and this Guaranty and any requirement that the Administrative Agent, any other Lender
or any holder of any Note protect, secure, perfect or insure any security interest or Lien, or any
property subject thereto, or exhaust any right or take any action against the Borrowers, any other
Obligor or any other Person (including any other guarantor) or entity or any collateral securing
the Obligations of the Borrowers or any other Obligor, as the case may be.

     SECTION 2.6 Waiver of Subrogation. Until the Obligations are paid in full, all
Commitments have terminated and all Lender Hedging Agreements have terminated (except as provided
in Section 10.01(e) of the Credit Agreement), the Guarantor shall not enforce or exercise any claim
or other rights which it may now or hereafter acquire against the Borrowers or any other Obligor
that arise from the existence, payment, performance or enforcement of the Guarantor’s obligations
under this Guaranty or any other Loan Document, including any right of subrogation, reimbursement,
exoneration, or indemnification, any right to participate in any claim or remedy of the Lenders
against the Borrowers or any other Obligor or any collateral which the Administrative Agent now has
or hereafter acquires, whether or not such claim, remedy or right arises in equity, or under
contract, statute or common law, including the right to take or receive from the Borrowers or any
other Obligor, directly or indirectly, in cash or other property or by set-off or in any manner,
payment or security on account of such claim or other rights. If any amount shall be paid to the
Guarantor in violation of the preceding sentence, such amount shall be deemed to have been paid to
the Guarantor for the benefit of, and held in trust for, the Lenders, and shall forthwith be paid
to the Administrative Agent for the benefit of the Lenders by the Guarantor receiving such payment
to be credited and applied upon the Obligations, whether matured or unmatured. The Guarantor
acknowledges that it will receive direct and indirect benefits from the financing arrangements
contemplated by the Credit Agreement and that the waiver set forth in this Section is knowingly
made in contemplation of such benefits.

     SECTION 2.7 Payments Free and Clear of Taxes, etc. The Guarantor hereby agrees that:

     (a) All payments by the Guarantor hereunder shall be made in accordance with
Section 3.01 of the Credit Agreement free and clear of and without deduction for any
and all present or future taxes, duties, levies, imposts, deductions, assessments,
fees, withholdings or similar charges, and all liabilities with respect thereto;
excluding, in the case of the Administrative Agent and each Lender, taxes imposed on or
measured by its net income (including any franchise taxes imposed on or measured by its
net income), by the jurisdiction (or any political subdivision thereof) under the Laws
of which the Administrative Agent or such Lender, as the case may be, is organized or
maintains its Lending Office (all such non-excluded taxes, duties, levies, imposts,
deductions, assessments, fees, withholdings or similar charges, and liabilities being
hereinafter referred to as “Taxes”). In the event that any withholding or deduction from any payment to
be made by the Guarantor hereunder is required in respect of any Taxes
pursuant to any applicable law, rule or regulation, then the Guarantor will
(i) pay directly to the relevant authority the full amount required to be so
withheld or deducted; (ii) promptly forward to such Lender an official
receipt or other documentation satisfactory to such Lender evidencing such
payment to such

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authority; and (iii) pay to such Lender such additional amount or amounts as is necessary to
ensure that the net amount actually received by such Lender will equal the full amount such Lender
would have received had no such withholding or deduction been required. Moreover, if any Taxes are
directly asserted against any Lender with respect to any payment received by such Lender hereunder,
such Lender may pay such Taxes and the Guarantor will promptly pay such additional amounts
(including, if incurred as a result of the Guarantor’s or the Borrowers’ action, omission or delay,
any penalties, interest or expenses) as is necessary in order that the net amount received by such
Lender after the payment of such Taxes (including any Taxes on such additional amount) shall equal
the amount such Lender would have received had such Taxes not been asserted.

     (b) If the Guarantor fails to pay any Taxes when due to the appropriate taxing authority or
fails to remit to any Lender the required receipts or other required documentary evidence, the
Guarantor shall indemnify such Lender for any incremental Taxes, interest or penalties that may
become payable by such Lender as a result of any such failure.

     (c) Without prejudice to the survival of any other agreement of the Guarantor hereunder, the
agreements and obligations of the Guarantor contained in this Section 2.7 shall survive the payment
in full of the principal of and interest on the Revolving Loan.

     SECTION 2.8 Subordination. The Guarantor hereby subordinates and makes inferior to the
Obligations any and all indebtedness now or at any time hereafter owed by the Borrowers or other
Obligor to the Guarantor. The Guarantor agrees that if any Event of Default has occurred and is
continuing under the Credit Agreement, it will not permit the Borrowers to repay such indebtedness
or any part thereof and it will not accept payment from the Borrowers of such indebtedness or any
part thereof without the prior written consent of the Required Lenders. If the Guarantor receives
any such payment without the prior required written consent, the amount so paid shall be held in
trust for the benefit of the Lenders, shall be segregated from the other funds of the Guarantor,
and shall forthwith be paid over to the Administrative Agent to be held by the Administrative Agent
as collateral for, or then or at any time thereafter applied in whole or in part by the
Administrative Agent against, all or any portions of the Obligations, whether matured or unmatured,
in such order as the Administrative Agent shall elect.

ARTICLE III

MISCELLANEOUS PROVISIONS

     SECTION 3.1 Loan Document. This Guaranty is a Loan Document executed pursuant to the
Credit Agreement and shall (unless otherwise expressly indicated herein) be construed, administered
and applied in accordance with the terms and provisions thereof.

     SECTION 3.2 Releases. At such time as the Revolving Loan shall have been paid in full
(other than contingent indemnity obligations and, with respect to L/C Obligations, if they have
been Cash Collateralized), the Commitments have been terminated, and, subject to Section 10.01(e)
of the Credit Agreement, no Lender Hedging Agreements are outstanding, the Administrative Agent
shall, at the request and expense of the Guarantor following such termination, promptly execute and
deliver to the Guarantor such documents and instruments as the Guarantor shall reasonably request
to evidence termination and release of this Guaranty.

     SECTION 3.3 Administrative Agent and Lenders; Successors and Assigns.

     (a) The Administrative Agent is Administrative Agent for each Lender under the Credit
Agreement. All rights granted to Administrative Agent under or in connection with this Guaranty are
for

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each Lender’s ratable benefit. The Administrative Agent may, without the joinder of any
Lender, exercise any rights in Administrative Agent’s or Lenders’ favor under or in connection with
this Guaranty. The Administrative Agent’s and each Lender’s rights and obligations vis-a-vis each
other may be subject to one or more separate agreements between those parties. However, the
Guarantor is not required to inquire about any such agreement and is not subject to any terms of it
unless the Guarantor specifically enters into such agreement. Therefore, neither the Guarantor nor
its successors or assigns are entitled to any benefits or provisions of any such separate agreement
nor are they entitled to rely upon or raise as a defense any party’s failure or refusal to comply
with the provisions of any such agreement.

     (b) This Guaranty benefits the Administrative Agent, the Lenders, and their respective
successors and assigns and binds the Guarantor and its successors and assigns. Upon appointment of
any successor Administrative Agent under the Credit Agreement, all of the rights of Administrative
Agent under this Guaranty automatically vest in that new Administrative Agent as successor
Administrative Agent on behalf of Lenders without any further act, deed, conveyance, or other
formality other than that appointment. The rights of the Administrative Agent and the Lenders under
this Guaranty may be transferred with any assignment of the obligations hereby guaranteed pursuant
to and in accordance with the terms of the Credit Agreement. The Credit Agreement contains
provisions governing assignments of the obligations guaranteed under this Guaranty.

     SECTION 3.4 Amendments, etc. No amendment to or waiver of any provision of this
Guaranty, nor consent to any departure by the Guarantor herefrom, shall in any event be effective
unless the same shall be in writing and signed by or on behalf of the party against whom it is
sought to be enforced and is in conformity with the requirements of Section 10.01 of the Credit
Agreement. Each such waiver or consent shall be effective only in the specific instance and for
the specific purpose for which given.

     SECTION 3.5 Addresses for Notices to the Guarantor. All notices and other
communications hereunder to the Guarantor shall be in writing and mailed or delivered to it,
addressed to it at the address set forth below or at such other address as shall be designated by
the Guarantor in a written notice to the Administrative Agent at the address specified in the
Credit Agreement complying as to delivery with the terms of this Section. All such notices and
other communications shall, when mailed, be effective when deposited in the mail, addressed as
aforesaid. Address for notices:

210 Park Avenue, Suite 2750

Oklahoma City, Oklahoma 73102

Facsimile: (405) 840-9897

Telephone: (405) 488-1304

     SECTION 3.6 No Waiver; Remedies. In addition to, and not in limitation of, Section 2.3
and Section 2.5, no failure on the part of any Lender or any holder of a Note to exercise, and no
delay in exercising, any right hereunder shall operate as a waiver thereof, nor shall any single or
partial exercise of any right hereunder preclude any other or further exercise thereof or the
exercise of any other right. The remedies herein provided are cumulative and not exclusive of any
remedies provided by law.

     SECTION 3.7 Section Captions. Section captions used in this Guaranty are for
convenience of reference only, and shall not affect the construction of this Guaranty.

     SECTION 3.8 Setoff. In addition to, and not in limitation of, any rights of any
Lender or any holder of a Note under applicable law, upon the occurrence and during the continuance
of an Event of

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Default under or as defined in the Credit Agreement, each Lender and each such holder shall be
entitled to exercise (for the benefit of all Lenders pursuant to Section 10.09 of the Credit
Agreement) any right of offset or banker’s lien against each and every account and other property
or interest that the Guarantor may now or hereafter have with, or which is now or hereafter in the
possession of, any such Lender, to the extent of the full amount of the Obligations.

     SECTION 3.9 Severability. Wherever possible, each provision of this Guaranty shall be
interpreted in such manner as to be effective and valid under applicable law, but if any provision
of this Guaranty shall be prohibited by or invalid under such law, such provision shall be
ineffective to the extent of such prohibition or invalidity, without invalidating the remainder of
such provision or the remaining provisions of this Guaranty.

     SECTION 3.10 Governing Law.

     (a) THIS GUARANTY SHALL BE GOVERNED BY, AND CONSTRUED IN ACCORDANCE WITH, THE LAW OF THE STATE
OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED ENTIRELY WITHIN SUCH STATE;
PROVIDED THAT THE ADMINISTRATIVE AGENT AND EACH LENDER SHALL RETAIN ALL RIGHTS ARISING
UNDER UNITED STATES FEDERAL LAW.

     (b) THE GUARANTOR AGREES ANY LEGAL ACTION OR PROCEEDING WITH RESPECT TO THIS GUARANTY OR ANY
OTHER LOAN DOCUMENT MAY BE BROUGHT IN THE COURTS OF THE STATE OF NEW YORK SITTING IN THE BOROUGH OF
NEW YORK OR OF THE UNITED STATES FOR THE SOUTHERN DISTRICT OF NEW YORK AND APPELLATE COURTS FROM
ANY THEREOF, AND BY EXECUTION AND DELIVERY OF THIS GUARANTY, THE GUARANTOR CONSENTS, FOR ITSELF AND
IN RESPECT OF ITS PROPERTY, TO THE NON-EXCLUSIVE JURISDICTION OF THOSE COURTS. THE GUARANTOR (1)
IRREVOCABLY WAIVES ANY OBJECTION, INCLUDING ANY OBJECTION TO THE LAYING OF VENUE OR BASED ON THE
GROUNDS OF FORUM NON CONVENIENS, WHICH IT MAY NOW OR HEREAFTER HAVE TO THE BRINGING OF ANY ACTION
OR PROCEEDING IN SUCH JURISDICTION IN RESPECT OF ANY LOAN DOCUMENT OR OTHER DOCUMENT RELATED
THERETO, AND (2) IRREVOCABLY CONSENTS TO THE SERVICE OF PROCESS OUT OF ANY OF THE AFOREMENTIONED
COURTS IN ANY SUCH ACTION OR PROCEEDING BY THE MAILING OF COPIES THEREOF BY CERTIFIED MAIL, RETURN
RECEIPT REQUESTED, POSTAGE PREPAID, AT ITS ADDRESS FOR NOTICES DESIGNATED HEREIN. THE GUARANTOR
WAIVES PERSONAL SERVICE OF ANY SUMMONS, COMPLAINT OR OTHER PROCESS, WHICH MAY BE MADE BY ANY OTHER
MEANS PERMITTED BY THE LAW OF SUCH STATE.

     SECTION 3.11 Waiver of Jury Trial, Etc. THE GUARANTOR HEREBY (a) EXPRESSLY AND
IRREVOCABLY WAIVES ANY RIGHT TO TRIAL BY JURY OF ANY CLAIM, DEMAND, ACTION OR CAUSE OF ACTION
ARISING UNDER ANY LOAN DOCUMENT OR IN ANY WAY CONNECTED WITH OR RELATED OR INCIDENTAL TO THE
DEALINGS OF THE PARTIES TO THE LOAN DOCUMENTS OR ANY OF THEM WITH RESPECT TO ANY LOAN DOCUMENT, OR
THE TRANSACTIONS RELATED THERETO, IN EACH CASE WHETHER NOW EXISTING OR HEREAFTER ARISING, AND
WHETHER FOUNDED IN CONTRACT OR TORT OR OTHERWISE; AND THE GUARANTOR HEREBY AGREES AND CONSENTS THAT
ANY SUCH CLAIM, DEMAND, ACTION OR CAUSE OF ACTION SHALL BE DECIDED BY COURT TRIAL WITHOUT A JURY,
AND THAT ADMINISTRATIVE AGENT OR ANY LENDER MAY FILE AN ORIGINAL COUNTERPART OR A COPY OF THIS SECTION WITH ANY COURT AS WRITTEN EVIDENCE OF THE CONSENT OF THE
GUARANTOR TO THE WAIVER OF ITS RIGHT TO TRIAL BY

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JURY; AND (b) EXPRESSLY AND IRREVOCABLY WAIVES, TO THE MAXIMUM EXTENT NOT PROHIBITED BY LAW,
ANY RIGHT IT MAY HAVE TO CLAIM OR RECOVER IN ANY SUCH ACTION ANY SPECIAL, EXEMPLARY, PUNITIVE OR
CONSEQUENTIAL DAMAGES, OR DAMAGES OTHER THAN, OR IN ADDITION TO, ACTUAL DAMAGES; PROVIDED THAT THE
WAIVER CONTAINED IN THIS SECTION 3.11 SHALL NOT APPLY TO THE EXTENT THAT THE PARTY AGAINST WHOM
DAMAGES ARE SOUGHT HAS ENGAGED IN GROSS NEGLIGENCE OR WILLFUL MISCONDUCT.

     SECTION 3.12 Entire Agreement. THIS GUARANTY AND THE OTHER LOAN DOCUMENTS REPRESENT
THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR,
CONTEMPORANEOUS, OR SUBSEQUENT ORAL AGREEMENTS OF THE PARTIES. THERE ARE NO UNWRITTEN ORAL
AGREEMENTS BETWEEN THE PARTIES.

[REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK

SIGNATRUES BEGIN ON NEXT PAGE.]

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     IN WITNESS WHEREOF, the Guarantor has caused this Guaranty to be duly executed and delivered
by an officer duly authorized as of the date first above written.

	 	 	 	 	 	 	 
	 	 	QUEST ENERGY PARTNERS, L.P.,	 	 
	 	 	a Delaware limited partnership, as Guarantor	 	 
	 
	 	 	 	 	 	 
	 

	 	By:
	 	Quest Energy GP, LLC, its General Partner	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/  Jerry D. Cash	 	 
	 

	 	 	 	 

Jerry D. Cash, Chairman and
	 	 
	 

	 	 	 	Chief Executive Officer	 	 

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Signature Page- 1

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