Exhibit 7
December 22, 2003
Cherokee Energy Partners LLC
000 Xxxxxxxxx Xx.
Xxxxxx, Xxxxxxxxxxxxx 00000
Re: Restrictions on Sale of Securities
Ladies and Gentlemen:
This letter is being delivered to Cherokee Energy Partners LLC ("Cherokee")
by the undersigned for good and valuable consideration, the receipt and
sufficiency of which is hereby acknowledged.
The undersigned hereby represents and warrants that they, joint and
severally, are the beneficial owner of 2,000,000 shares (the "Shares") of Common
Stock ("Common Stock") of Quest Resource Corporation ("Quest"). In the event
that Quest (i) declares a dividend or makes any other distribution upon the
Shares payable in Common Stock or (ii) subdivides its outstanding Shares of
Common Stock into a greater number of shares then, in each case, the number of
Shares shall be proportionately increased to reflect such distribution or stock
split.
The undersigned hereby agrees and covenants that he or she will not,
without the prior written consent of Cherokee, sell, offer to sell, contract or
agree to sell, hypothecate, pledge (other than the pledge of such Shares
existing on the date hereof), grant any option to purchase or otherwise dispose
of, agree to dispose of, or permit the disposition of, (or enter into any
transaction which is designed to, or might reasonably be expected to, result in
the disposition (whether by actual disposition or effective economic disposition
due to cash settlement or otherwise) by the undersigned, directly or indirectly,
including the filing (or participation in the filing) of a registration
statement with the Securities and Exchange Commission in respect of, or
establish or increase a put equivalent position or liquidate or decrease a call
equivalent position within the meaning of Section 16 of the Securities Exchange
Act of 1934, as amended, and the rules and regulations of the Securities and
Exchange Commission promulgated thereunder with respect to, all or any portion
of the Shares, or publicly announce an intention to effect any such transaction,
for a period of 18 months after the date of this Letter Agreement, other than
Shares disposed of as bona fide gifts approved by Cherokee, provided that
Cherokee receives a similar lock-up agreement from the recipient of the bona
fide gift.
This Letter Agreement shall be binding upon the successors, assigns, heirs
and personal representatives of the undersigned.
Cherokee Energy Partners LLC
December 22, 2003
Page 2
The undersigned understands that Cherokee is entering into and proceeding
with certain transactions in reliance upon this Letter Agreement.
Yours very truly,
/s/ Xxxxxx X. Xxxx
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Xxxxxx X. Xxxx
/s/ Xxxxxxx X. Xxxx
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Xxxxxxx X. Xxxx