Document:

exv10w88

Exhibit 10.88

NO. 2008-52399

	 	 	 	 	 
	QUEST RESOURCES CORPORATION,

	 	§
	 	IN THE DISTRICT COURT OF
	QUEST ENERGY PARTNERS, L.P. AND

	 	§	 	 
	QUEST MIDSTREAM PARTNERS, L.P.

	 	§	 	 
	 

	 	§	 	 
	vs.

	 	§	 	 
	 

	 	§
	 	HARRIS COUNTY, T E X A S
	ROCKPORT ENERGY, LP, ROCKPORT

	 	§	 	 
	GEORGETOWN PARTNERS, LLC,

	 	§	 	 
	ROCKPORT GEORGETOWN LLC,

	 	§	 	 
	JERRY D. CASH, BRYAN T.

	 	§	 	 
	SIMMONS AND STEVEN L.

	 	§	 	 
	HOCHSTEIN

	 	§
	 	165TH JUDICIAL DISTRICT

SETTLEMENT AGREEMENT

     Effective this 30th day of March, 2009, this Settlement Agreement (“Settlement Agreement”)
is entered into by and between: Jerry D. Cash (“Cash”) and Quest Resource Corporation, Quest Energy
Partners, L.P., and Quest Midstream Partners, L.P. (collectively referred to herein as the “Quest
Entities”) (all parties to this Settlement Agreement are hereafter referred to as the “Parties”).

RECITALS

     WHEREAS, Cash is a former officer and director of Quest Resource Corporation, and served as
such from November, 2002 through August 22, 2008. Cash also held other positions, including
officer and director positions, with the Quest Entities and their affiliates during this time
period (Cash’s collective employment during his tenure with the Quest Entities and their affiliates
is collectively referred to herein as “Cash’s Quest Employment”).

     WHEREAS, between June 2004 and July 2008, Cash received transfers of money from the Quest
Entities (the “Transfers”).

     WHEREAS, the Quest Entities are plaintiffs and Cash is a defendant in a lawsuit filed in the
165th Judicial District Court, Harris County, Texas entitled Quest Resource Corporation,

 

 

Quest Energy Partners, L.P., and Quest Midstream Partners, L.P. v. Rockport Energy, L.L.C.,
Rockport Georgetown Partners, L.L.C., Rockport Georgetown, L.L.C., Rockport Georgetown Holdings,
L.P., Jerry D. Cash, Bryan T. Simmons and Steve Hochstein; Case No. 2008-52399 (the “‘Lawsuit”).

     WHEREAS, disputes have arisen between the Quest Entities, on the one hand, and Cash, on the
other hand, regarding Cash’s Quest Employment, the Transfers and the Lawsuit.

     WHEREAS, in order to avoid possible disputes, costs, burdens or distractions of future
litigation, the Parties now desire, and, through the execution of this Settlement Agreement,
intend, to resolve and settle all disputes among the Parties, including those related to Cash’s
Quest Employment, the Transfers and the Lawsuit.

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

	I.	 	TERMS OF SETTLEMENT

     Upon execution and delivery of four original copies of this Settlement Agreement by the
Parties and the complete execution by counsel for the Parties of an Order of Dismissal with
Prejudice for filing with the Clerk of the Court to formally dismiss Cash from the Lawsuit, the
Parties agree to and will do the following:

     (a) Cash agrees to transfer and convey to the Quest Entities the following:

	 	1)	 	the net proceeds after closing on the sale of Cash’s residence
at 7401 Nichols Road, Nichols Hills, Oklahoma 73120;
	 
	 	2)	 	all of Cash’s interest in STP Newco, Inc., including the North
Holtuke Unit located in Seminole and Pottawattamie Counties, Oklahoma and in
the South Pond Creek Unit located in Grant County, Oklahoma effective March 1,
2009;

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	 	3)	 	all of Cash’s interest in Rockport Energy, LLC, including but
not limited to interests in the Bird Island Well located in Southern Louisiana
and in LGS, L.P.

     All monies paid at the closing of the Cash residence will be paid to the Quest Entities.

     (b) Cash represents and warrants that after the conveyance of the assets set forth in (a)
above, he has no direct or indirect ownership interest in any other assets (other than: (i) 1.78
million shares of Quest Resource Corporation common stock pledged to secure loans from Intrust Bank
totaling approximately $6 million; (ii) Cash’s Quest 401(K) account; (iii) a rental house at 1612
Downing Street, Oklahoma City, Oklahoma with a value of approximately $110,000, subject to a
mortgage of approximately $73,000; (iv) the balance of Cash’s distributions from his interest in
the North Holtuke Unit and South Pond Creek Unit through March 1, 2009; (v) two 2005 Ford F-150s,
one 2008 leased Range Rover Sport and one BMW;1 and (vi) personal property excluded from
the sale of Cash’s residence and personal property included therewith).

     (c) The Quest Entities acknowledge that STP Newco, Inc. is obligated to Coppermark Bank for a
note in the approximate amount of $686,461 relating to the North Holtuke and South Pond Creek
Units.

     (d) Cash and the Quest Entities further agree to exchange for equal value three paintings by
Gordon Brown (located at the offices of the Quest Entities and purchased by Cash) for two rock
sculptures described as “Quartz Cluster” and “Down Rabbit Hole,” as well as a “Petrified Stump”
(located at Cash’s residence and purchased by the Quest Entities).

     (e) The Quest Entities will waive the one-year non-compete as to Cash outlined in Paragraph 15
of Cash’s Employment Agreement dated April 2, 2007.

 

			
	1	 	The Range Rover and BMW are leased by STP Newco. The
leases must be assigned to a person or entity other than STP Newco or delivered
to Quest’s office at 210 Park Avenue.

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     (f) Quest Resource Corporation agrees to satisfy $125,000 of Cash’s outstanding legal fees and
expenses from August 2008 through the date of the closing of the house from Quest Resource
Corporation’s general operating account. Those funds will be directly paid to Cash’s attorneys,
Locke Lord Bissell & Liddell LLP and Ryan Whaley Coldiron Shandy. Quest Resource Corporation will
be reimbursed if and when Cash’s attorneys receive payment from the Quest Entities’ insurance
carriers for all outstanding legal fees and expenses incurred through the date of closing of Cash’s
residence. The Quest Entities will receive the benefit of any agreed reductions in those legal
bills.

     (g) The Quest entities agree to return all of Cash’s personal property, including documents
(but not including STP Newco or Rockport documents), within five business days after closing of the
Cash’s residence.

	II.	 	MUTUAL RELEASE

     (a) Except as to such rights as may be created by this Settlement Agreement and specifically
set forth in II(d) below, the Quest Entities and their past, present, and future predecessors,
successors, affiliates (including, but not limited to Quest Energy Service, LLC, Quest Energy GP,
LLC, Quest Cherokee, LLC, Quest Cherokee Oilfield Service, Quest Midstream GP, LLC, and Bluestem
Pipeline, LLC), agents, employees, representatives, members, fiduciaries, beneficiaries, officers,
directors, parent entities, subsidiaries, and hereby irrevocably and unconditionally RELEASE,
ACQUIT, WAIVE, AND FOREVER DISCHARGE Jerry D. Cash, his heirs, executors, administrators, agents,
representatives, successors, assigns, and attorneys, from and against any and all known and unknown
claims, obligations, debts, loans, liabilities, losses, and damages whatsoever in law or equity,
asserted or unasserted that the Quest Entities ever had, presently have, or may have in the future
against Cash, including, but

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not limited to, any and all actual or implied claims, demands and causes of action asserted in,
arising out of or connected with, directly or indirectly, Cash’s Quest Employment, the Transfers,
and the subject matter of the Lawsuit or that could have been asserted in the Lawsuit or in any
other lawsuit. This release of Cash by the Quest Entities and their past, present, and future
predecessors, successors, affiliates does not release and has no effect upon: (1) any civil or
criminal charges, claims, obligations, debts, liabilities, losses, and damages by or of any third
party, including but not limited to, shareholders of Quest Resource Corporation and Quest Energy
Partners, L.P., the State of Oklahoma, and the United States of America; or (2) the rights and
obligations of American International Insurance Group, Inc. or any other insurer.

     (b) Except as to such rights as may be created by this Settlement Agreement and specifically
set forth in II(c) below, Cash hereby irrevocably and unconditionally RELEASES, ACQUITS, WAIVES,
AND FOREVER DISCHARGES Quest Resource Corporation, Quest Energy Partners, L.P. and Quest Midstream
Partners, L.P., and their respective heirs, executors, administrators, agents, representatives,
subsidiaries, affiliates, employees, partners, officers, directors, shareholders, successors,
assigns, and attorneys from and against any and all known and unknown claims, obligations, debts,
loans, liabilities, losses and damages whatsoever in law or equity, asserted or unasserted that
Cash ever had, presently has, or may have in the future against the Quest Entities, including, but
not limited to, any and all actual or implied claims, demands and causes of action, asserted in,
arising out of or connected with, directly or indirectly, Cash’s Quest Employment, the Transfers,
and the subject matter of the Lawsuit or that could have been asserted in the Lawsuit or in any
other lawsuit, or any violation of any federal, state, or local law, including, but not limited to,
any violation of Title VII of the Civil Rights Act of 1964, as amended, 42 U.S.C. § 2000e et seq.,
the Civil Rights Act of 1866, 42 U.S.C. § 1981, the

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Equal Pay Act, 29 U.S.C. § 206, the Employee Retirement Income Security Act of 1974, 29 U.S.C. §
1001 et seq., the Americans with Disabilities Act, 42 U.S.C. § 12101 et seq., the Age
Discrimination in Employment Act of 1967, as amended (“ADEA”), 29 U.S.C. § 621 et seq., the Family
and Medical Leave Act, 29 U.S.C. § 2601 et seq., the Fair Credit Reporting Act, 15 U.S.C. § 1681 et
seq., the Sarbanes-Oxley Act, 18 U.S.C. § 1514A et seq., the Occupational Safety and Health Act,
Section 11(c), 29 U.S.C. § 660(c); Oklahoma Anti-Discrimination Act, 25 O.S.A. § 1101; Oklahoma
Equal Pay Act, 40 O.S.A. § 198.1, Oklahoma Genetic Nondiscrimination In Employment Act, 36 O.S.A. §
3614.2, Oklahoma Workers’ Compensation Act, 85 O.S.A. § 5 or any other employment or civil rights
act, and any and all claims for severance pay or benefits under any compensation or employee
benefit plan, program, policy, contract, agreement or other arrangement of the Quest Entities or
affiliates, including any claim under any deferred incentive compensation plan.

     (c) Cash DOES NOT RELEASE the Quest Entities from any obligations arising from the
Indemnification Agreement dated as of March 5, 2008 between Cash and Quest Resource Corporation
(“Cash Indemnity Agreement”), which includes the advancement of legal fees and expenses, against
any current or future threatened or pending litigation, investigations or proceedings, by reason of
the fact that Cash was an officer, director and employee of Quest Resource Corporation and/or the
Quest Entities. Additionally, Cash DOES NOT RELEASE the Quest Entities’ insurance carriers front
any rights and obligations, including but not limited to indemnity and advancement of legal fees
and expenses, of which Cash is entitled under any applicable policy.

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     (d) The Quest Entities DO NOT RELEASE any other person or entity except as set forth herein.
Additionally, the Parties agree that the Quest Entities are not waiving any rights to assert any
applicable defense set forth in the Cash Indemnity Agreement.

	III.	 	NO ADMISSION OF LIABILITY

     The Parties hereto acknowledge that they expressly understand that this Settlement Agreement
and the settlement it represents (a) are entered into solely for the purpose of avoiding any
possible future disputes, expenses, burdens or distractions of litigation and (b) in no way
constitute an admission by any party hereto of any liability of any kind to any other party or of
any wrongdoing on the part of any of the Parties.

	IV.	 	ADEA WAIVER

     Cash, who represents and warrants that he is over forty (40) years of age,
acknowledges that the Older Workers Benefit Protection Act of 1990 (“OWBPA”) has been fully
explained to him, and that by execution of this Settlement Agreement he knowingly and voluntarily
waives all claims he has or may have under the Age Discrimination in Employment Act, Chapter 14 of
Title 29 of the United States Code (“ADEA”), as amended. Cash acknowledges that he has been given
at least 21 days in which to consider this Settlement Agreement before signing. Cash acknowledges
that he has been advised to consult with an attorney before signing this Settlement Agreement and
acknowledges that he has done so. Cash further acknowledges that he has freely, knowingly, and
voluntarily entered into this Settlement Agreement, and that he has read this Settlement Agreement
and fully understands its terms. Cash is not waiving any rights or claims that may arise after the
date he executes this Settlement Agreement. Cash acknowledges that by executing this Settlement
Agreement, and waiving such rights and claims, he is receiving consideration in addition to what he
would actually be entitled.

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	V.	 	CONSIDERATION

     The Parties acknowledge, warrant, and agree that adequate consideration was
exchanged and supplied by all parties to the Settlement Agreement.

	VI.	 	JOINT EFFORTS

     This Settlement Agreement has been prepared by the joint efforts of the respective
attorneys for each of the Parties and each party acknowledges that they have carefully read the
instrument and that the instrument expresses the entire agreement between the Parties concerning
the subject it purports to cover and that each party has executed this instrument freely and of his
own accord.

	VII.	 	ADDITIONAL DOCUMENTS

     The Parties and their counsel shall execute all such further and additional
documents that shall be reasonable, convenient, and necessary to carry out the provisions and
intent of this Settlement Agreement. The Parties agree to sign, or direct their attorney to sign,
and file all documents necessary to obtain a Court Order dismissing all claims raised in the
Lawsuit against Cash.

	VIII.	 	GOVERNING LAW

     The validity, effect, and construction of this Settlement Agreement and any
obligations undertaken pursuant hereto, and any dispute relating to or arising from the negotiation
and execution of this Settlement Agreement shall he governed by the laws of the State of Oklahoma,
without regard to any conflict of laws provisions.

     EXECUTED
this 14th day of May, 2009.

	 	 	 	 	 
	 
	 	 	 	 
	 
	 	/s/ Jerry D. Cash	 	 
	 

	 	 	 	 
	 

	 	JERRY D. CASH
	 	 

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     EXECUTED
this 30th day of March, 2009.

	 	 	 	 	 	 	 
	 	 	QUEST RESOURCE CORPORATION	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ David C. Lawler	 	 
	 

	 	 	 	 	 	 
	 

	 	Its:	 	President	 	 
	 

	 	 	 	 	 	 

     EXECUTED
this 30th day of March, 2009.

	 	 	 	 	 	 	 
	 	 	QUEST ENERGY PARTNERS, L.P.	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ David C. Lawler	 	 
	 

	 	 	 	 	 	 
	 

	 	Its:	 	President	 	 
	 

	 	 	 	 	 	 

     EXECUTED
this 30th day of March, 2009.

	 	 	 	 	 	 	 
	 	 	QUEST MIDSTREAM PARTNERS, L.P.	 	 
	 
	 	 	 	 	 	 
	 
	 	 	 	 	 	 
	 

	 	By:	 	/s/ David C. Lawler	 	 
	 

	 	 	 	 	 	 
	 

	 	Its:	 	President	 	 
	 

	 	 	 	 	 	 

9exv10w89

Exhibit 10.89

CAUSE NO. 2008-52399

	 	 	 	 	 
	QUEST RESOURCE CORPORATION,

	 	§
	 	IN THE DISTRICT COURT OF
	QUEST ENERGY PARTNERS, L.P.,

	 	§	 	 
	AND QUEST MIDSTREAM

	 	§	 	 
	PARTNERS, L.P.,

	 	§	 	 
	 

	 	§	 	 
	                    Plaintiffs,

	 	§	 	 
	 

	 	§	 	 
	v.

	 	§	 	 
	 

	 	§
	 	HARRIS COUNTY, T E X A S
	ROCKPORT ENERGY, LLC,

	 	§	 	 
	ROCKPORT GEORGETOWN

	 	§	 	 
	PARTNERS, LLC, ROCKPORT

	 	§	 	 
	GEORGETOWN LLC, ROCKPORT

	 	§	 	 
	GEORGETOWN HOLDINGS, LP,

	 	§	 	 
	JERRY D. CASH, BRYAN T. SIMMONS

	 	§	 	 
	AND STEVEN HOCHSTEIN,

	 	§	 	 
	 

	 	§	 	 
	                    Defendants.

	 	§
	 	165TH JUDICIAL DISTRICT

FULL AND FINAL SETTLEMENT AGREEMENT AND MUTUAL RELEASE

     THIS FULL AND FINAL SETTLEMENT AGREEMENT AND MUTUAL RELEASE (the “Agreement”) is made as of
the last date signed below, among Quest Resource Corporation; Quest Energy Partners, L.P.; Quest
Midstream Partners, L.P. (collectively, “Quest”); Rockport Energy, LLC; Rockport Georgetown
Partners, LLC; Rockport Georgetown, LLC; Rockport Georgetown Holdings, LP; Jerry D. Cash; Bryan T.
Simmons and Steven Hochstein. (collectively, the “Parties”).

RECITALS:

     WHEREAS, Quest Resource Corporation; Quest Energy Partners, L.P.; and Quest Midstream
Partners, L.P. sued Rockport Energy, LLC; Rockport Georgetown Partners, LLC; Rockport Georgetown,
LLC; Rockport Georgetown Holdings, LP; Jerry D. Cash; Bryan T.

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Simmons and Steve Hochstein in the case styled Quest Resource Corporation, et al. v. Rockport
Energy, LLC, et al.; Cause No. 2008-52399; In the District Court of Harris County, Texas;
165th Judicial District (the “Lawsuit”); and

     WHEREAS, Rockport Energy, LLC, Bryan T. Simmons (“Simmons”), and Steven Hochstein
(“Hochstein”) filed cross-claims against Jerry D. Cash (“Cash”); and

     WHEREAS, Cash did not file an answer to the Lawsuit or to cross-claims; and

     WHEREAS, Quest amended its petition and dropped Rockport Georgetown Partners, LLC; Rockport
Georgetown, LLC; and Rockport Georgetown Holdings, LP as defendants in the Lawsuit; and

     WHEREAS, Rockport Energy, LLC, Bryan T. Simmons and Steven Hochstein deny all liability under
claims asserted by Quest; and

     WHEREAS, there is uncertainty and disagreement concerning the existence and extent of
liability regarding matters at issue in the Lawsuit; and

     WHEREAS, to avoid the expense, inconvenience, and uncertainty of litigation, the Parties wish
to compromise and settle the claims filed in the Lawsuit and the matters in dispute among them with
respect to the Lawsuit; and

     WHEREAS, the Parties do not wish or intend this Agreement to be an admission by any of them
concerning any matter whatsoever; and

     NOW THEREFORE, in consideration of the promises contained herein and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged, the Parties agree as
follows:

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     1. Settlement:

	 	a.	 	As to Quest’s Claims against Rockport Energy LLC, Bryan T.
Simmons, Steve Hochstein, and Jerry Cash: Rockport Energy, LLC agrees to
assign, convey, pay or cause to be assigned, conveyed, or paid to Quest and
Quest agrees to accept the following:

	 	1.	 	60% of Rockport Energy, LLC’s
interest in the Bird Island well (API# 17-023-22995), the ALL RA
SUA unit, respective State Lease No. 18809 and any other
interests in said unit. The interest shall be assigned to Quest
in the form attached as Exhibit A.
	 
	 	2.	 	60% of Rockport Energy, LLC’s
imputed interest in LGS Partners, L.P. The interest shall be
conveyed to Quest in the form attached as Exhibit B.
	 
	 	3.	 	A cash payment of $188,650.00.
The payment of $188,650 shall be paid within five (5) business
days of the full execution of this Full and Final Settlement
Agreement and Release by the Parties by wire transfer to:
	 
	 	 	 	Name of institution: Comerica Bank

Name on the account: Quest Resource Corporation

ABA No.: 111000753

Account number: 1881237372

	 	b.	 	As to Rockport Energy, LLC, Bryan T. Simmons and Steve
Hochstein’s claims against Jerry Cash: Rockport Energy, LLC will transfer
$80,000 which has been held by Rockport Energy tax obligations. The amount
will be forwarded to Cash’s accountant, Tom Swearingen, to be held in escrow

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	 	 	 	pending payment to the I.R.S. Upon the completion of assignments, conveyances
and payments due to Quest described above, Cash shall no longer have any
interest in Rockport Energy, LLC and hereby relinquishes any such interest to
Bryan T. Simmons and Steve Hochstein. Cash agrees to relinquish his membership
in Rockport Energy, LLC in the form attached as Exhibit C.

     2. Release by Quest of Rockport Energy, LLC: Quest Resource Corporation, Quest Energy
Partners, L.P., Quest Midstream Partners, L.P. and its past and present affiliates, parents,
subsidiaries, divisions, predecessors, successors and assigns, and its present and former partners,
employees, representatives, officers, directors, shareholders, and attorneys (the “Quest Parties”),
hereby release and forever discharge Rockport Energy, LLC and its past and present affiliates,
parents, subsidiaries, divisions, predecessors, successors and assigns, and its present and former
members, managers, employees, representatives, officers, directors, and attorneys (the “Rockport
Energy Parties”) of and from any and all claims, causes of action, suits, demands, charges,
disputes, matters, controversies, liability, accrued or to accrue in the future, known or unknown,
relating to, arising out of, or in any way connected to the events and transactions which were
brought or could have been brought in the Lawsuit. This is a general release and is intended to be
as broad as the law allows.

     3. Release by Quest of Bryan T. Simmons: The Quest Parties hereby release and forever
discharge Bryan T. Simmons and his heirs, representatives, agents, successors, and assigns (the
“Simmons Parties”) of and from any and all claims, causes of action, suits, demands, charges,
disputes, matters, controversies, liability, accrued or to accrue in the future, known or unknown,
relating to, arising out of, or in any way connected to the events and transactions

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which were brought or could have been brought in the Lawsuit. This is a general release and
is intended to be as broad as the law allows.

     4. Release by Quest of Steven Hochstein: The Quest Parties hereby release and forever
discharge Steven Hochstein and his heirs, representatives, agents, successors, and assigns (the
“Hochstein Parties”) of and from any and all claims, causes of action, suits, demands, charges,
disputes, matters, controversies, liability, accrued or to accrue in the future, known or unknown,
relating to, arising out of, or in any way connected to the events and transactions which were
brought or could have been brought in the Lawsuit. This is a general release and is intended to be
as broad as the law allows.

     5. Release by Quest of Rockport Georgetown Partners, LLC; Rockport Georgetown, LLC; and
Rockport Georgetown Holdings, LP: The Quest Parties hereby release and forever discharge
Rockport Georgetown Partners, LLC; Rockport Georgetown, LLC; and Rockport Georgetown Holdings, LP,
and their past and present affiliates, parents, subsidiaries, divisions, predecessors, successors
and assigns, and their present and former members, managers, partners, employees, representatives,
officers, directors, and attorneys (“the Rockport Georgetown Releasees”) of and from all claims,
causes of action, suits, demands, charges, disputes, matters, controversies, liability, accrued or
to accrue in the future, known or unknown, relating to, arising out of, or in any way connected to
the events and transactions which were brought or could have been brought in the Lawsuit. This is
a general release and is intended to be as broad as the law allows.

     6. Release by Jerry Cash of Rockport Energy, LLC, Bryan T. Simmons and Steven
Hochstein: Cash and his heirs, representatives, agents, successors, and assigns (the “Cash
Parties”) hereby release and forever discharge the Rockport Energy Parties, the Simmons

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Parties and the Hochstein Parties of and from all claims, causes of action, suits, demands,
charges, disputes, matters, controversies, liability, accrued or to accrue in the future, known or
unknown, relating to, arising out of, or in any way connected to the events and transactions which
were brought or could have been brought in the Lawsuit. This is a general release and is intended
to be as broad as the law allows.

     7. Release by Rockport Energy, LLC, Bryan T. Simmons and Steven Hochstein of Jerry
Cash: The Rockport Energy Parties, the Simmons Parties and the Hochstein Parties hereby
release and forever discharge the Cash Parties of and from all claims, causes of action, suits,
demands, charges, disputes, matters, controversies, liability, accrued or to accrue in the future,
known or unknown, relating to, arising out of, or in any way connected to the events and
transactions which were brought or could have been brought in the Lawsuit. This is a general
release and is intended to be as broad as the law allows.

     8. Independent Settlement Agreement between Cash and Quest: The Parties acknowledge
and agree that the terms, conditions, obligations and representations embodied in the Settlement
Agreement dated May 19, 2009, between Cash and the Quest Entities (“Quest/Cash Agreement”)
supersede the terms, conditions, obligations and representations embodied in this Agreement with
regard to Cash and the Quest Entities to the extent they are inconsistent with the terms,
conditions, obligations and representations embodied in the Quest/Cash Agreement.

     9. Defense and Indemnity Obligations: The Quest Parties are obligated to defend and
indemnify Bryan T. Simmons and Steven Hochstein for actions taken as officers and employees of
Quest or a related Quest entity to the extent that defense and indemnity is provided

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to Quest employees, officers or directors. This Agreement does not include any release of the
Quest Parties’ obligations to defend and indemnify Bryan T. Simmons and Steven Hochstein.

     10. Dismissal with Prejudice: In consideration for the mutual promises contained in
this Agreement, the parties shall file a Motion for Dismissal with Prejudice in the form attached
hereto as Exhibit D. Said Motion for Dismissal with Prejudice shall be filed in the Lawsuit within
five (5) business days following Quest’s receipt of the assignments, conveyances and payments
described above in Part 1.a. Each Party will be fully responsible for its own court costs,
including taxable court costs, attorneys’ fees, and all other expenses arising out of the Lawsuit
or this Agreement.

     11. Confidentiality Agreement: The parties agree that the terms of this Agreement
shall be CONFIDENTIAL. This means that the parties and their attorneys shall not disclose to
anyone the terms of this Agreement, including the amount paid (or that any amount was paid) in
settlement of the Lawsuit, except as required by legal or regulatory process, court order,
governmental authority, professional requirements, or insurance agreement. Any person to whom this
information is disclosed will be advised that the information is confidential. In the event that
disclosure of this Agreement or its terms is sought from any party to this Agreement by subpoena or
other legal process, the party upon whom the request is serviced shall give notice of the request
as soon as practicable, by fax and by overnight delivery to the other Party’s counsel.

     12. Ownership of Claims Released:

	 	a.	 	Quest represents that it owns the claims and rights being
released in paragraphs 2-5 (the “Quest Released Claims”), and that no other
person or

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	 	 	 	entity owns, asserts, or has ever asserted any interest in the Quest Released
Claims.
	 
	 	b.	 	Cash represents that he owns the claims and rights being
released in paragraph 6 (the “Cash Released Claims”), and that no other person
or entity owns, asserts, or has ever asserted any interest in the Cash Released
Claims.
	 
	 	c.	 	Rockport Energy, LLC, Bryan T. Simmons and Steve Hochstein
represent that they own the claims and rights being released in paragraph 7
(the “Rockport Released Claims”), and that no other person or entity owns,
asserts, or has ever asserted any interest in the Rockport Released Claims

     13. Governing Law: This Agreement is to be construed, interpreted, and enforced under
the laws of the State of Texas.

     14. No Waiver: No waiver of any provision of this Agreement shall be effective unless
it is in writing and signed by the party against whom it is asserted, and any such written waiver
shall be applicable only to the specific instance to which it relates and shall not be deemed to be
a continuing or future waiver.

     15. Execution in Counterparts: This Agreement may be signed in separate counterparts
by facsimile, each of which shall constitute an original.

     16. Entire Agreement and Amendments: The Parties agree that this Agreement sets forth
all the promises and agreements between them and supersedes all prior and contemporaneous
agreements, understandings, inducements, or conditions, expressed or implied, oral or written. No
modifications, amendments, or changes to this Agreement shall be valid unless in writing and signed
by an authorized representative of the Parties.

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     17. Successors: It is understood and agreed that this Agreement shall be binding upon
and inure to the benefit of the Parties and their respective heirs, representatives, successors,
and assigns.

     18. Authority: Each signatory to this Agreement hereby warrants and represents that
such person has full authority to bind the Party or Parties for whom such person acts.

     19. Voluntary Execution: The Parties executing this Agreement represent, warrant and
acknowledge that both they and their attorneys have read this Agreement, that they have consulted
with their attorneys regarding this Agreement, that they are authorized to execute this Agreement,
that there may be facts pertaining to the subject matter of this Agreement of which they are not
presently aware but that they assume the risk of entering into this Agreement notwithstanding, that
this Agreement is binding on them and their respective entities after execution by them, and that
they execute this Agreement voluntarily, in good faith and without reliance upon any representation
of any kind or character not expressly set forth herein.

     20. No Admission of Liability: It is fully understood by the Parties that the terms
of this Agreement are contractual, that the Agreement is made in compromise, resolution, and
settlement of all disputed claims, that such compromise, resolution, and settlement and this
Agreement shall not be taken as an admission of liability of any kind or character by any of the
Parties, and that such liability is expressly denied by the Parties. This Agreement shall not be
admissible in any proceeding or cause of action as an admission of liability by any of the Parties.

     21. Construction of Agreement: All Parties have contributed to the drafting of this
Agreement and have had an opportunity to consult with their respective counsel of their choice and
to change any provision within this Agreement prior to its execution. In the event of any dispute
arising among the Parties in connection with this Agreement, it is the intent of the Parties

9

 

that no party shall be entitled to have any wording of this Agreement construed either in
favor of or against any other party based on the fact that such party is alleged to have been the
drafter of the Agreement.

     22. Severability: This Agreement is intended to be performed in accordance with, and
only to the extent permitted by, all applicable legal requirements. If any provision of this
Agreement or the application of this Agreement to any person or circumstance shall for any reason
and to any extent, be invalid or unenforceable, the part of this Agreement in which such provision
is contained, the remainder of this Agreement, and the application of such provision to other
persons or circumstances shall not be affected thereby, but rather shall be enforced to the
greatest extent permitted by law.

     23. Attorneys’ Fees: If any Party files a lawsuit to enforce or construe any
provision in this Agreement, the prevailing party shall be entitled to recover all attorneys’ fees
and costs of court incurred in same.

signatures appear on the following page

10

 

To evidence assent to the terms of this Agreement, the Parties have executed this Agreement as set
forth below:

Quest Resource Corporation

	 	 	 	 	 
	By:

	 	/s/ David C. Lawler	 	 
	 

	 	 	 	 
	 

	 	(name), (office)	 	 

ACKNOWLEDGMENT

	 	 	 	 	 
	STATE OF OKLAHOMA

	 	§	 	 
	 

	 	§	 	 
	COUNTY OF OKLAHOMA

	 	§	 	 

     BEFORE ME, the undersigned authority, on this day personally appeared David C. Lawler,
President of Quest Resource Corporation, known to me to be the person who signed the foregoing Full
and Final Settlement Agreement and Mutual Release, and acknowledged that he signed on behalf of
Quest Resource Corporation voluntarily and of his own free will after having read and understood
its effect.

     GIVEN before me this 15th day of May, 2009, by the said David C. Lawler, President of Quest
Resource Corporation.

	 	 	 
	 	 	
/s/ Jerris Johnson
 

NOTARY PUBLIC in and for

the State of Oklahoma
	 	 	
My Commission Expires:
	 	 	
10/16/2011
 

11

 

Quest Energy Partners, L.P.

	 	 	 	 	 
	By:	 	
/s/ David C. Lawler
 

(name), (office)	 	 

ACKNOWLEDGMENT

	 	 	 	 	 
	STATE OF OKLAHOMA

	 	§	 	 
	 

	 	§	 	 
	COUNTY OF OKLAHOMA

	 	§	 	 

     BEFORE ME, the undersigned authority, on this day personally appeared David C. Lawler,
President of Quest Energy Partners, L.P., known to me to be the person who signed the foregoing
Full and Final Settlement Agreement and Mutual Release, and acknowledged that he signed on behalf
of Quest Energy Partners, L.P. voluntarily and of his own free will after having read and
understood its effect.

     GIVEN before me this 15th day of May, 2009, by the said David C. Lawler, President of Quest
Energy Partners, L.P.

	 	 	 
	 	 	
/s/ Jerris Johnson
 

NOTARY PUBLIC in and for

the State of Oklahoma
	 	 	
My Commission Expires:
	 	 	
10/16/2011
 

12

 

Quest Midstream Partners, L.P.

	 	 	 	 	 
	By:	 	
/s/ David C. Lawler
 

(name), (office)	 	 

ACKNOWLEDGMENT

	 	 	 	 	 
	STATE OF OKLAHOMA

	 	§	 	 
	 

	 	§	 	 
	COUNTY OF OKLAHOMA

	 	§	 	 

     BEFORE ME, the undersigned authority, on this day personally appeared David C. Lawler,
President of Quest Midstream Partners, L.P., known to me to be the person who signed the foregoing
Full and Final Settlement Agreement and Mutual Release, and acknowledged that he signed on behalf
of Quest Midstream Partners, L.P. voluntarily and of his own free will after having read and
understood its effect.

     GIVEN before me this 15th day of May, 2009, by the said David C. Lawler, President of Quest
Midstream Partners, L.P.

	 	 	 
	 	 	
/s/ Jerris Johnson
 

NOTARY PUBLIC in and for

the State of Oklahoma
	 	 	
My Commission Expires:
	 	 	
10/16/2011
 

13

 

Rockport Energy, LLC

	 	 	 	 	 
	By:	 	
/s/ Steven L. Hochstein
 

Steven L. Hochstein, Manager	 	 

ACKNOWLEDGMENT

	 	 	 	 	 
	STATE OF TEXAS

	 	§	 	 
	 

	 	§	 	 
	COUNTY OF HARRIS

	 	§	 	 

     BEFORE ME, the undersigned authority, on this day personally appeared Steven L. Hochstein,
Manager of Rockport Energy, LLC, known to me to be the person who signed the foregoing Full and
Final Settlement Agreement and Mutual Release, and acknowledged that he signed on behalf of
Rockport Energy, LLC voluntarily and of his own free will after having read and understood its
effect.

     GIVEN before me this 14 day of May, 2009, by the said Steven L. Hochstein, Manager of Rockport
Energy, LLC.

	 	 	 
	 	 	
/s/ Katie M. Casey
 

NOTARY PUBLIC in and for

the State of Texas
	 	 	
My Commission Expires:
	 	 	
March 26, 2012
 

14

 

Rockport Georgetown Partners, LLC

	 	 	 	 	 
	By:
	 	/s/ Jerry Cash 	 	 
	 

	 	 	 	 
	 

	 	(name), (office)	 	 

ACKNOWLEDGMENT

	 	 	 	 	 
	STATE OF OKLAHOMA

	 	§	 	 
	 

	 	§	 	 
	COUNTY OF OKLAHOMA

	 	§	 	 

     BEFORE
ME, the undersigned authority, on this day personally appeared Jerry
Cash,
Manager of Rockport Georgetown Partners, LLC, known to me to be the person who signed the
foregoing Full and Final Settlement Agreement and Mutual Release, and acknowledged that he signed
on behalf of Rockport Georgetown Partners, LLC voluntarily and of his own free will after having
read and understood its effect.

     GIVEN
before me this 19th day of May, 2009, by the said Manager,
Jerry Cash of Rockport Georgetown Partners, LLC.

	 	 	 
	 	 	/s/ Jennifer Johnson
	 	 	NOTARY PUBLIC in and for
the State of Oklahoma
	 	 	
My Commission Expires:
	 	 	04/19/13 

15

 

Rockport Georgetown, LLC

	 	 	 	 	 
	By:
	 	/s/ Jerry Cash	 	 
	 

	 	 	 	 
	 

	 	(name), (office)	 	 

ACKNOWLEDGMENT

	 	 	 	 	 
	STATE OF OKLAHOMA

	 	§	 	 
	 

	 	§	 	 
	COUNTY OF OKLAHOMA

	 	§	 	 

     BEFORE ME, the undersigned authority, on this day personally appeared Jerry Cash,
Manager of Rockport Georgetown, LLC, known to me to be the person who signed the foregoing Full
and Final Settlement Agreement and Mutual Release, and acknowledged that he signed on behalf of
Rockport Georgetown, LLC voluntarily and of his own free will after having read and understood its
effect.

     GIVEN
before me this 19th day of May, 2009, by the said Jerry Cash, Manager
of Rockport Georgetown, LLC.

	 	 	 
	 	 	
/s/ Jennifer Johnson

 

NOTARY PUBLIC in and for

the State of Oklahoma
	 	 	
My Commission Expires:
	 	 	
04/19/13

 

16

 

Rockport Georgetown Holdings, LP

	 	 	 	 	 
	By:
	 	/s/  Jerry Cash	 	 
	 

	 	 	 	 
	 

	 	(name), (office)	 	 

ACKNOWLEDGMENT

	 	 	 	 	 
	STATE OF OKLAHOMA

	 	§	 	 
	 

	 	§	 	 
	COUNTY OF OKLAHOMA

	 	§	 	 

     BEFORE ME, the undersigned authority, on this day personally appeared Jerry Cash,
Manager of Rockport Georgetown Holdings, LP, known to me to be the person who signed the
foregoing Full and Final Settlement Agreement and Mutual Release, and acknowledged that he signed
on behalf of Rockport Georgetown Holdings, LP voluntarily and of his own free will after having
read and understood its effect.

     GIVEN
before me this 19th day of May, 2009, by the said Jerry Cash, Manager of Rockport Georgetown Holdings, LP.

	 	 	 
	 	 	
 

/s/  Jennifer Johnson

NOTARY PUBLIC in and for

the State of Texas
	 	 	
My Commission Expires:
	 	 	
 

04/19/13

17

 

Bryan T. Simmons

	 	 	 
	
/s/ Bryan T. Simmons
 
	 	 

ACKNOWLEDGMENT

	 	 	 	 	 
	STATE OF TEXAS

	 	§	 	 
	 

	 	§	 	 
	COUNTY OF HARRIS

	 	§	 	 

     BEFORE ME, the undersigned authority, on this day personally appeared Bryan T. Simmons, known
to me to be the person who signed the foregoing Full and Final Settlement Agreement and Mutual
Release, and acknowledged that he signed voluntarily and of his own free will after having read and
understood its effect.

     GIVEN before me this 14 day of May, 2009, by Bryan T. Simmons.

	 	 	 
	 	 	
/s/ Katie M. Casey
 

NOTARY PUBLIC in and for

the State of Texas
	 	 	
My Commission Expires:
	 	 	
March 26, 2012
 

18

 

Steven Hochstein

	 	 	 
	/s/
Steven Hochstein
 
	 	 

ACKNOWLEDGMENT

	 	 	 	 	 
	STATE OF TEXAS

	 	§	 	 
	 

	 	§	 	 
	COUNTY OF HARRIS

	 	§	 	 

     BEFORE ME, the undersigned authority, on this day personally appeared Steven Hochstein, known
to me to be the person who signed the foregoing Full and Final Settlement Agreement and Mutual
Release, and acknowledged that he signed voluntarily and of his own free will after having read and
understood its effect.

     GIVEN before me this 14 day of May, 2009, by Steven Hochstein.

	 	 	 
	 	 	
/s/ Katie M. Casey
 

NOTARY PUBLIC in and for

the State of Texas
	 	 	
My Commission Expires:
	 	 	
March 26, 2012
 

19

 

Jerry D. Cash

	 	 	 
	
 

/s/  Jerry D. Cash
	 	 

ACKNOWLEDGMENT

	 	 	 	 	 
	STATE OF OKLAHOMA

	 	§	 	 
	 

	 	§	 	 
	COUNTY OF OKLAHOMA

	 	§	 	 

     BEFORE ME, the undersigned authority, on this day personally appeared Jerry D. Cash, known to
me to be the person who signed the foregoing Full and Final Settlement Agreement and Mutual
Release, and acknowledged that he signed voluntarily and of his own free will after having read and
understood its effect.

     GIVEN
before me this 19th day of May, 2009, by Jerry D. Cash.

	 	 	 
	 	 	
 

/s/  Jennifer Johnson

NOTARY PUBLIC in and for

the State of Oklahoma
	 	 	
My Commission Expires:
	 	 	
 

04/19/13

20

 

Exhibit A

ASSIGNMENT AND BILL OF SALE

State: LOUISIANA

Parish: CAMERON

Assignor: Rockport Energy, LLC

Assignee: Quest Resource Corporation

Effective Date: November 1, 2008

     For adequate consideration, the receipt and sufficiency of which is acknowledged, Assignor,
named above, sells, assigns, and transfers unto Assignee, named above, and Assignee’s successors
and assigns, an undivided Sixty percent (60%) of Assignor’s right, title, interests, and properties
described in paragraphs 1. through 10. below, and all rights, estates, powers and privileges
appurtenant to those rights, interests, and properties, all collectively referred to in this
Assignment as the “Assets.”

     1. An undivided Sixty percent (60%) of all rights, title, and interests of Assignor in, to, and
under the oil, gas, and mineral leases (the “Leases”) and wells (the “Wells”) described in Exhibit
“A,” including any working interests and over-riding royalty interests, and the oil and gas
leasehold estates and other interests in the lands described on Exhibit “A.” Exhibit “A” is
attached to and made a part of this Assignment and Bill of Sale for all purposes.

     2. Without limit the foregoing, an undivided Sixty percent (60%) of all other rights, title, and
interests of Assignor, of whatever kind or character in and to the lands specifically described on
Exhibit “A” (the “Lands”), even though the interests of Assignor and the Lands may be incorrectly
described, or a description of an interest is omitted from Exhibit “A”; and, an undivided Sixty
percent (60%) of all rights, title, and interests of Assignor in, to, under, or derived from all
oil, gas, and mineral leases and leasehold fee or mineral interests and all other interests of
whatever character, insofar as the same covers or relates to the Lands, Leases and Wells described
in Exhibit “A” even though an interest may be incorrectly described or omitted from Exhibit “A.”

     3. An undivided Sixty percent (60%) of all rights, title, and interests of Assignor in all rights,
privileges, benefits, and powers conferred on the holder of the Leases, Lands and Wells with
respect to the use and occupation of the surface and the subsurface depths under the Lands and
Leases.

     4. An undivided Sixty percent (60%) of all rights, title, and interests of Assignor in any pooled
or unitized acreage or rights included, in whole or in part, within the Lands, including all oil
and gas production from the pool or unit allocated to such properties (including, without
limitation, units formed under orders, rules, regulations, or other official acts of any state or
other authority having jurisdiction and so called “working interest units” created under operating
agreements or otherwise) and all interests in any wells within the unit or pool associated with
such properties, whether the unitized or pooled oil and gas production comes from wells located
within or without the areas covered by the Lands, and all tenements, hereditaments, and
appurtenances belonging to the properties.

     5. An undivided Sixty percent (60%) of all rights, title, and interests of Assignor in all of the
permits, licenses, servitudes, easements, rights of way, orders, gas purchase and sale contracts,
crude oil purchase and sale contracts or agreements, surface leases, farmin and farmout agreements,
acreage contribution agreements, operating agreements, unit agreements, processing agreements,
options, leases of equipment or facilities, and other contracts, agreements, and rights, and any
amendments, which are owned by Assignor, in whole or in part, whether or not the same appear of
record in the county where the Lands are located, and which are appurtenant to, affect, are used or
held for use in connection with either the ownership, operation, production, treatment or marketing
of oil and gas, or either of them, and the sale or disposal of water, hydrocarbons, or associated
substances from the Lands and Leases.

     6. An undivided Sixty percent (60%) of all rights, title, and interests of Assignor in all of the
real, personal, and mixed property located in or on the Lands, Leases and Wells or used in their
operation, which are owned by Assignor or by a third person on behalf of Assignor, in whole or in
part, including, without limitation, crude oil, condensate, or products (in storage or in
pipelines), wells, well equipment, casing, tanks, boilers, buildings, tubing, pumps, motors,
valves, fixtures, machinery and other equipment, pipelines, gathering systems, power lines,
telephone lines, roads, field processing plants, and all other improvements used in operations.

     7. An undivided Sixty percent (60%) of all of the rights, title, and interests of Assignor in all
of the files, records, information, and data relating to the items described in paragraphs 1.
through 6. above, including without limitation, title records (including title opinions, abstracts,
and title curative documents); contracts; geological and seismic records, data and information;
and, production records, electric logs, and all related matters.

 

 

     8. To the extent transferable, the benefit of and the right to enforce all rights, covenants, and
warranties, if any, under the terms and conditions of any of the agreements and contracts described
in paragraph 5. above, which Assignor is entitled to enforce, with respect to the Assets, against
Assignor’s predecessors in title to the Assets and against any other party to such agreements and
contracts.

     9. To the extent necessary to allow Assignee to have full use of and access to the Lands, Assignor
grants such right of ingress and egress, rights of way and easements, and their full and
uninterrupted use, across any lands which Assignor may own or where Assignor may be the lessee
under an oil, gas, and mineral lease(s), over or through which Assignee crosses or has the right to
cross for use and access to the Lands described in Exhibit “A.” This grant is limited to the
rights of Assignor to grant such rights of ingress and egress, rights of way, and easements under
agreements, deeds, or leases through which Assignor claims title.

     10. An undivided Sixty percent (60%) of all other rights and obligations arising under contract or
otherwise by law, or by the occurrence of conditions precedents, which may or may not yet have
occurred, owned in whole or in part by Assignor, which rights and obligations are incidental to the
Assets described in paragraphs 1. through 9. above, including the right, if any, to operate the
Assets.

     TO HAVE AND TO HOLD the Assets unto Assignee and its successors and assigns forever; provided,
however, this Assignment is made by Assignor and accepted by Assignee subject to the following
terms, representations, agreements, and provisions:

     1. Assignor represents and agrees that its joint interest account, if applicable, with the operator
of wells on the Lands and Leases is current, and that all ad valorem taxes assessed, due and
payable on the Assets have been fully paid for all time periods. Assignor acknowledges Assignee
has materially relied upon this representation in accepting this Assignment.

     2. At closing, Assignor shall deliver to Assignee all relevant books, records, files, documents,
data, and other information pertaining to the Assets. From time to time, whether at or after
closing, as requested by Assignee, its successors or assigns, Assignor will execute and deliver any
and all documents and take such other reasonable actions as may be necessary to fully convey and
transfer the Assets to Assignee.

     3. Assignor shall be entitled to all proceeds accruing to the Assets prior to the Effective Date of
this Assignment and Bill of Sale, including proceeds attributable to product inventories above the
pipeline connection and gas product inventories as of the Effective Date and shall be responsible
for operating expenses, capital expenditures, all taxes, and other obligations on the Assets
acquired in previous Agreements prior to the Effective Date. Assignee shall be entitled to an
undivided Sixty percent (60%) of proceeds accruing to the Assets, whether it be a working interest
or over-riding royalty interest, after the Effective Date and shall be responsible for the
operating expenses, capital expenditures, all taxes, or other obligations on the Assets Assignor
may have had prior to the Effective Date.

     4. This Assignment and Bill of Sale is made expressly subject to all of the leases, agreements, and
other documents described in Exhibit “A,” and all other valid and existing contracts, easements,
and other instruments affecting all or any part of the Assets, together with any and all existing
overriding royalties and other interests payable out of production from all or any part of the
Lands, as shown of record.

     As to claims arising by, through, or under Assignor, Assignor warrants that title to the
Assets is good and marketable, and Assignor agrees that Assignor shall be responsible for title
defects occurring or arising out of occurrences or omissions of, by, through, or under Assignor,
but not otherwise. In addition, Assignor represents and covenants that the Assets are free and
clear of any and all liens, encumbrances, or claims of third parties created by Assignor; and,
further that Assignor has no notice of pending litigation or claims of any kind, including claims
by the owners of the surface and/or mineral estate, which would or could, if successfully
prosecuted, impair in any manner the Assets.

     ASSIGNOR MAKES NO REPRESENTATION OR WARRANTY OF ANY KIND, NATURE OR DESCRIPTION, EXPRESS OR
IMPLIED, WITH RESPECT TO THE EQUIPMENT AND PERSONAL PROPERTY LOCATED ON THE ASSETS, INCLUDING,
WITHOUT LIMITATION, THE CONDITION OF THE EQUIPMENT OR ITS MERCHANTABILITY OR FITNESS FOR ANY
PARTICULAR PURPOSE.

     It is the intention and agreement of Assignor and Assignee that the provisions of this
Assignment and Bill of Sale shall be severable. Should the whole or any portion of a section or
paragraph be judicially held to be void or invalid, such holding shall not affect other portions
which can be given effect without the invalid or void portion.

     The provisions of this Assignment shall be binding on and inure to the benefit of Assignee and
Assignor and their respective affiliates, heirs, devisees, legal or personal representatives,
successors, and assigns and shall constitute covenants running with the Lands and the Assets.

 

 

     This Assignment is executed by Assignor and Assignee as of the date of the acknowledgments of
their signatures below, but is effective as of the Effective Date stated above.

	 	 	 	 	 
	 	 	 	 	Rockport Energy, LLC (Assignor)
	 	 	
By:
	 	 

 

	 	 	 	 	 

 

	 	 	
Title:
	 	 

 

	 	 	 	 	Quest Resource Corporation (Assignee)
	 	 	
By:
	 	 

 

	 	 	 	 	 

 

	 	 	
Title:
	 	 

 

[Exhibit “A”: Description of Oil and Gas Lease, Land and Well.]

	 	 	 	 	 	 	 	 	 
	STATE OF TEXAS

	 	 	)	 	 	 	 	 
	 

	 	 	)	 	 	§	 	 
	COUNTY OF

	 	 	)	 	 	 	 	 

     Before me, the undersigned, a Notary Public, in and for said County and State, on this ___
day of  , 2009, personally appeared _____, to me known to be the identical person who
subscribed the name of the maker thereof to the within and forgoing instrument as its _____, and acknowledged to me that he executed the same as his free and voluntary act and deed of
such corporation, for the uses and purposes therein set forth.

IN WITNESS WHEREOF, I have hereunto set my official signature and affixed my official seal the day
and year last above written.

	 	 	 	 	 
	My commission expires:	 	
 

 

	 	 

 

Notary Public

	 	 	 	 	 	 	 	 	 
	STATE OF OKLAHOMA

	 	 	)	 	 	 	 	 
	 

	 	 	)	 	 	§	 	 
	COUNTY OF OKLAHOMA

	 	 	)	 	 	 	 	 

     Before me, the undersigned, a Notary Public, in and for said County and State, on this ___
day of  , 2009, personally appeared _____, to me known to be the identical person who
subscribed the name of the maker thereof to the within and forgoing instrument as its _____, and acknowledged to me that he executed the same as his free and voluntary act and deed of
such corporation, for the uses and purposes therein set forth.

IN WITNESS WHEREOF, I have hereunto set my official signature and affixed my official seal the day
and year last above written.

	 	 	 	 	 
	My commission expires:	 	
 

 

	 	 

 

Notary Public

 

 

EXHIBIT “A”

Attached to and made a part hereof that certain Assignment and Bill of Sale
dated ___ by and between Rockport Energy, LLC, (as Assignor) and
Quest ___, (as Assignee):

	 	 	 
	Well:

	 	SL 18809 Well#1, known as the Bird Island Well, API # 17-023-22995,
located upon State Lease No. 18809, Cameron Parish, Louisiana.
	Lease:

	 	State Lease No. 18809, recorded December 27, 2005 at Entry No.
295296 of the official records of Cameron Parish, Louisiana, Harold
J. Anderson as original Lessee.

 

 

Exhibit B

BILL OF SALE AND ASSIGNMENT OF LIMITED PARTNERSHIP INTEREST

     This Bill of Sale and Assignment of Limited Partnership Interest (this “Agreement”),
dated effective as of May 19, 2009, and effective as of April 7, 2009 (the “Effective
Date”), is by and between ROCKPORT ENERGY LLC, a Texas limited liability company
(“Rockport”), and QUEST OIL & GAS LLC, a Kansas limited liability company
(“Quest”), as assignee of QUEST RESOURCE CORPORATION, a Nevada corporation (“Quest
Corporation”). Capitalized terms used but not defined herein shall have the meaning given such
term in the Agreement of Limited Partnership of LGS Development, L.P., a Texas limited partnership
(the “Partnership”) dated as of May 4, 2005 (as amended, the “Partnership
Agreement”). All capitalized terms used herein and not otherwise defined herein will have the
meanings assigned to such terms in the Partnership Agreement

RECITALS

     WHEREAS, Rockport has been named as a defendant in the case styled Quest Resource Corporation
et al. v. Rockport Energy, LLC et al.; Cause No. 2008-52399; In the 165th Judicial
District Court, Harris County, Texas (the “Lawsuit”);

     WHEREAS, Rockport holds an LP Interest in the Partnership, which LP Interest represents, as of
March 29, 2009 and subject to change in accordance with the Partnership Agreement, a Percentage
Interest of 44.66501% prior to Payout and a Percentage Interest of 25.00% following Payout (the
“Rockport Interest”); and

     WHEREAS, pursuant to the terms of the Full and Final Settlement Agreement and Mutual Release,
dated as of May 19, 2009 (the “Settlement”), among Quest Corporation, Quest Energy
Partners, L.P., Quest Midstream Partners, L.P., Rockport, Rockport Georgetown Partners, LLC,
Rockport Georgetown, LLC, Rockport Georgetown Holdings, LP, Jerry D. Cash, Bryan T. Simmons and
Steven Hochstein, in consideration of a release of all claims by the plaintiffs in the Lawsuit
against Rockport, its members, Jerry D. Cash, Bryan T. Simmons, and Steven Hochstein and the other
defendants in the Lawsuit, Rockport has agreed to convey and assign 60% of the Rockport Interest
(the “Transferred Interest”) to Quest, such interest being an LP Interest that, as of March
29, 2009 and subject to change in accordance with the Partnership Agreement, represents a
Percentage Interest of 26.799006% prior to Payout and a Percentage Interest of 15.00% following
Payout.

     NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants contained herein
and in the Settlement and other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto promise and agree as follows:

     1. Pursuant to the terms of the Settlement, Rockport hereby sells, assigns, conveys, grants
and transfers the Transferred Interest to Quest in consideration of the release and discharge by
Quest Corporation of all claims which were brought or could have been brought by Quest Corporation
in the Lawsuit.

 

 

     2. Rockport represents and warrants as of the date hereof that: (i) it is the beneficial and
record owner of the Transferred Interest; (ii) it holds good, valid and marketable title to the
Transferred Interest, free and clear of any security interest, mortgage, deed of trust, pledge,
lien or other encumbrance of any nature whatsoever (together, “Encumbrances”); (iii) it
possesses full authority and legal right to sell, transfer and assign to Quest the entire legal and
beneficial ownership of the Transferred Interest, free and clear of all Encumbrances; and (iv) upon
transfer of the Transferred Interest, Quest will own the entire legal and beneficial interest in
the Transferred Interest free and clear of all Encumbrances, and subject to no legal, equitable,
transfer or other restrictions of any kind, except transfer restrictions imposed by operation of
applicable securities laws.

     3. Each party hereby agrees from time to time after delivery of this instrument to do,
execute, acknowledge and deliver or to cause to be done, executed, acknowledged and delivered such
further agreements, transfers, assignments, conveyances and assurances, including but not limited
to the Consent and Amendment No. 4 to the Agreement of Limited Partnership of the Partnership dated
as of the date hereof, as may be reasonably requested by the other party in order to effect the
full assignment, transfer and assumption, as applicable, of the Transferred Interest and any
related liabilities.

     4. Nothing in this Agreement, express or implied, is intended or shall be construed to confer
upon, or give to, any person other than the parties hereto and their respective successors or
assigns, any remedy or claim under or by reason of this Agreement or any term, covenant or
condition hereof, and all of the terms, covenants and conditions, promises and agreements contained
in this Agreement shall be for the sole and exclusive benefit of the parties hereto and their
successors and assigns.

     5. This Agreement may be executed in any number of counterparts with the same effect as if the
signatures thereto were upon one instrument.

     6. None of the provisions in this Agreement may be waived, changed or altered except in a
writing signed by all of the parties hereto.

     7. This Agreement shall be governed by and construed and enforced in accordance with the
internal laws (as opposed to the conflicts of laws provisions) of the State of Texas.

[Signature Page Follows]

2

 

     IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed as of the date
first written above, to be effective as of the Effective Date.

	 	 	 	 	 
	 	ROCKPORT:

ROCKPORT ENERGY LLC,

a Texas limited liability company

 	 
	 	By:  	 	 
	 	 	Name:  	Bryan T. Simmons 	 
	 	 	Title:  	Manager 	 
	 
	 	QUEST:

QUEST OIL & GAS LLC,

a Kansas limited liability company

 	 
	 	By:  	 	 
	 	 	Name:  	David C. Lawler  	 
	 	 	Title:  	President 	 

 

 

Exhibit C

BILL OF SALE AND ASSIGNMENT OF UNITS

     This Bill of Sale and Assignment of Units (this “Agreement”), dated effective as of
May 19, 2009, is by and among JERRY D. CASH, an individual resident of the State of Oklahoma (the
“Transferor”), STEVEN HOCHSTEIN, an individual resident of the State of Texas
(“Hochstein”), and BRYAN T. SIMMONS, an individual resident of the State of Texas
(“Simmons” and together with Hochstein, the “Transferees”). Capitalized terms used
but not defined herein shall have the meaning given such term in the Operating Agreement of
Rockport Energy LLC dated as of April 15, 2004 (the “Operating Agreement”).

RECITALS

     WHEREAS, each of Rockport Energy LLC, a Texas limited liability company (“Rockport”),
the Transferor, and the Transferees has been named as a defendant in the case styled Quest Resource
Corporation et al. v. Rockport Energy, LLC et al.; Cause No. 2008-52399; In the 165th
Judicial District Court, Harris County, Texas (the “Lawsuit”);

     WHEREAS, the Transferor currently holds 33.3 Units (the “Transferred Units”) in
Rockport, and each of the Transferees currently holds 33.3 Units in Rockport; and

     WHEREAS, pursuant to the terms of the Full and Final Settlement Agreement and Mutual Release
(the “Settlement”) dated as of May 19, 2009, among Quest Resource Corporation, Quest Energy
Partners, L.P., Quest Midstream Partners, L.P., Rockport, Rockport Georgetown Partners, LLC,
Rockport Georgetown, LLC, Rockport Georgetown Holdings, LP, the Transferor, and the Transferees, in
consideration of a release of all cross-claims by Rockport and the Transferees (collectively, the
“Cross Claimants”) against the Transferor, the Transferor has agreed to convey and assign
the Transferred Units equally to each of the Transferees.

     NOW, THEREFORE, in consideration of the foregoing and of the mutual covenants contained herein
and in the Settlement and other good and valuable consideration, the receipt and sufficiency of
which are hereby acknowledged, the parties hereto promise and agree as follows:

     1. Pursuant to the terms of the Settlement, the Transferor hereby sells, assigns, conveys,
grants and transfers the Transferred Units equally to each of the Transferees in consideration of
the release and discharge by the Cross Claimants of all cross-claims which were brought or could
have been brought by the Cross Claimants against the Transferor in the Lawsuit.

     2. The Transferor represents and warrants as of the date hereof that: (i) he is the beneficial
and record owner of the Transferred Units; (ii) he holds good, valid and marketable title to the
Transferred Units, free and clear of any security interest, mortgage, deed of trust, pledge, lien
or other encumbrance of any nature whatsoever (together, “Encumbrances”); (iii) he
possesses full authority and legal right to sell, transfer and assign equally to each of the
Transferees the entire legal and beneficial ownership of the Transferred Units, free and clear of
all Encumbrances; and (iv) upon transfer of the Transferred Units, the Transferees together will
own the entire legal and beneficial interest in the Transferred Units free and clear of all

 

 

Encumbrances, and subject to no legal, equitable, transfer or other restrictions of any kind,
except transfer restrictions imposed by operation of applicable securities laws.

     3. Each party hereby agrees from time to time after delivery of this instrument to do,
execute, acknowledge and deliver or to cause to be done, executed, acknowledged and delivered such
further transfers, assignments, conveyances and assurances as may be reasonably requested by the
other party in order to effect the full assignment, transfer and assumption, as applicable, of the
Transferred Units and any related liabilities.

     4. Nothing in this Agreement, express or implied, is intended or shall be construed to confer
upon, or give to, any person other than the parties hereto and their respective successors or
assigns, any remedy or claim under or by reason of this Agreement or any term, covenant or
condition hereof, and all of the terms, covenants and conditions, promises and agreements contained
in this Agreement shall be for the sole and exclusive benefit of the parties hereto and their
successors and assigns.

     5. This Agreement may be executed in any number of counterparts with the same effect as if the
signatures thereto were upon one instrument.

     6. None of the provisions in this Agreement may be waived, changed or altered except in a
writing signed by all of the parties hereto.

     7. This Agreement shall be governed by and construed and enforced in accordance with the
internal laws (as opposed to the conflicts of laws provisions) of the State of Texas.

[Signature Page Follows]

2

 

     IN WITNESS WHEREOF, the parties have caused this Agreement to be duly executed as of the date
first written above.

	 	 	 	 	 
	 

	 	TRANSFEROR:	 	 
	 

	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 

	 	 	 	 
	 

	 	JERRY D. CASH	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 

	 	TRANSFEREES:	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 

	 	 	 	 
	 

	 	 	 	 
	 

	 	STEVEN HOCHSTEIN	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 
	 	 	 	 
	 

	 	 	 	 
	 

	 	 	 	 
	 

	 	BRYAN T. SIMMONS	 	 

[Signature Page to the Bill of Sale and Assignment of Units]

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