EMPLOYMENT AGREEMENT

EMPLOYMENT AGREEMENT

This Agreement (the “Agreement”) is made and entered into on this 7 ^th day of March, 2007 (the “Effective Date”), between QUEST RESOURCE CORPORATION (the “Company”), and DAVID BOLTON (“Employee”).

a.             Agreement to Employ . The Company hereby employs Employee and Employee hereby accepts employment upon the terms and conditions hereinafter set forth. Employee will serve as Executive Vice President Land of the Company.

b.            Duties . Employee agrees that so long as he is employed pursuant to this Agreement, he will: (i) to the satisfaction of the Company, devote his best efforts and his entire business time to further properly the interests of the Company; (ii) at all times be subject to the direction and control of the Chief Executive Officer of the Company with respect to his activities on behalf of the Company; (iii) comply with all rules, orders and regulations of the Company and all statutes, regulations, interpretive rulings and other enactments to which the Company is subject; (iv) truthfully and accurately maintain and preserve such records and make all reports as the Company may require; and (v) fully account for all monies which he may from time to time have custody over and deliver the same to the Company whenever and however directed to do so.

a.             Base Salary . For all services to be rendered by Employee, the Company shall pay Employee a salary at the rate of Two Hundred Twenty Five Thousand and No/100 Dollars ($225,000.00) per year, in installments of equal frequency to the Company’s standard payroll practices. Salary payments shall be subject to withholding and other applicable taxes (e.g., federal and state withholding, FICA, earnings tax, etc).

b.            Incentive Bonus Compensation/Stock Options . Employee shall be entitled to participate in an incentive bonus plan or program with a maximum potential amount of up to 100% of Base Salary, as such plan or program is established annually by the Board of Directors (or the Company’s Compensation Committee). Employee’s actual bonus level will be contingent upon the Company achieving predetermined financial results and the Board’s (and/or Compensation Committee’s) approval, including approval of any components based on Company or individual performance. Employee acknowledges that actual payouts under the plan may be more or less than Employee’s target level based on the performance of the Company against plan criteria and Employee’s performance against any individual objectives.

c.             Restricted Stock Grant . Employee shall be granted 45,000 restricted shares of the Company pursuant to the terms of the 2005 Omnibus Stock Award Plan (including the terms of any Award Agreement executed in connection with such Plan). The restricted shares will vest in accordance with the following schedule, if employee is employed on such date:

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3.            Term . Unless earlier terminated by either party as provided in Section 5 or 6 hereof, this Agreement shall commence on March __, 2007, and shall continue for a period of three (3) years thereafter until March __, 2010 (the “Initial Term”). Upon the expiration of the Initial Term, this Agreement shall automatically continue in effect for successive one (1) year terms (a “Renewal Term”) unless terminated by either party by providing written Notice of Termination (as provided in Section 7) not less than one hundred twenty (120) days prior to the end of the Initial Term or any Renewal Term.

4.            Employee Benefits . Employee shall be entitled, during his employment hereunder, to receive and participate in employee benefits available to senior executives of the Company as the Board of Directors (or the Compensation Committee) of the Company determines, in its sole discretion, from time to time.

Employee acknowledges that the benefits described above are subject to change in the discretion of the Board of Directors (or the Compensation Committee) of the Company, and that Employee is only entitled to participate in these benefits to the extent they are made available by the Company to senior executives from time to time.

a.             Voluntary Resignation . Employee shall have the right to terminate his employment at any time by providing no less than thirty (30) days prior written Notice of Termination to the Company as specified in section 7 herein. Employee hereby agrees to assist in the training of his replacement, if requested.

b.             With Good Reason . The Employee may terminate this Agreement with “Good Reason” as provided in this Section 5(b). Good Reason means (i) the Company’s failure to pay the Employee’s salary or annual bonus in accordance with the terms of this Agreement (unless the payment is not material and is being contested by the Company in good faith); (ii) the requirement of the Company that the Employee be based anywhere other than Oklahoma City, Oklahoma (with the understanding that substantial travel may be required for Employee’s position); (iii) a substantial reduction in the Employee’s duties or responsibilities; or (iv) Employee no longer being the Executive Vice President Land of the Company provided, however, that the Employee will give the Company thirty days prior written Notice of Termination, as specified in section 7 herein, of the basis for claiming Good Reason exists, and the Company shall have failed to cure such breach or nonperformance during the thirty day notice period. In such event, the Company shall pay Employee severance pay (“Severance Pay”) equal to Employee’s remaining Base Salary for the Initial Term or for any Renewal Term, as applicable. The Severance Pay shall be paid to Employee in equal installments on the Company’s regular payroll dates, with such installments to commence six (6) months after Employee’s termination of employment (at which time Employee will receive a lump sum amount equal to the monthly payments that would have been paid during such six month period); provided, however, that if the payment of the Severance Pay meets an exemption under Internal

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Revenue Code § 409A (“§ 409A”) concerning the timing of payment of severance compensation, then the payment of the Severance Pay will commence upon Employee’s termination of employment. In addition, Company shall pay Employee (i) his pro rata portion of any annual bonus or other compensation to which he would have been entitled for the year during which the termination occurred, such payment to be made at such time that bonuses are paid to all employees, or if later, six (6) months after Employee’s termination of employment (unless an exception to § 409A applies); and (ii) Employee’s COBRA health insurance premium payments (for the same coverage that Employee had in place prior to his termination) for the duration of the COBRA continuation period, or if earlier, until the Employee becomes eligible for health insurance because of employment with a different employer. Employee shall only be paid Severance Pay, pro rata bonuses and COBRA health insurance premiums under this Section if he signs an agreement containing a release of claims against the Company, in a form substantially similar to that included in Exhibit A, attached hereto and incorporated herein. Employee will cease to be an employee of the Company as of the date specified in the Notice of Termination, and he will not receive or accrue any benefits of employment after such date, except as provided herein. Severance Pay, pro rata bonuses and COBRA health insurance premium payments shall not be paid to the Employee if Employee owns, manages, operates, joins, contracts with, or is employed by or connected in any manner with (whether as principal, partner, shareholder, member, director, officer, employee, agent or otherwise), any business which is competitive to the business engaged in by the Company. For purposes of this Agreement, a business shall be deemed to be competitive to the business engaged in by the Company if such business is engaged in the same or similar business activities conducted by the Company in the same geographical area in which the Company conducts its business operations (or is actively pursuing business operations) at the time of Employee’s termination of employment.

c.             Employee’s Disability . The Employee may terminate his employment hereunder if his health should become impaired to an extent that makes the continued performance of his duties hereunder hazardous to his physical or mental health or his life; provided, that the Employee shall have furnished the Company with a written statement from a qualified doctor to such effect. In the event this Agreement is terminated as a result of the Employee’s disability, (i) the Employee shall receive from the Company, in a lump sum payment due within thirty (30) days of the effective date of termination, the sum equal to Two Hundred Twenty Five Thousand Dollars 00/100 ($225,000.00), and (ii) all compensation and benefits that accrued and vested as of the date of Termination. In order to, and to the extent necessary to, comply with Section 409A, all cash amounts due under this Section 5(c) shall be payable to Employee in a lump-sum cash payment on the six-month anniversary of the date of Employee’s termination of employment.

a.             Without Cause . The Company may terminate Employee’s employment under this Agreement at any time without cause by giving Employee a Notice of Termination as provided under Section 7 hereof. In such event, the Company shall pay Employee severance pay (“Severance Pay”) equal to Employee’s remaining Base Salary for the Initial Term or for any Renewal Term, as applicable, in accordance with the following payment schedule: (i) if Employee’s employment is terminated within two (2) years following a “change in control” (as defined below), the Severance Pay will be paid in one lump sum six (6) months following

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Employee’s termination of employment; (ii) in all other cases, Severance Pay shall be paid to Employee in equal installments on the Company’s regular payroll dates, with such installments to commence six (6) months after Employee’s termination of employment (at which time Employee will receive a lump sum amount equal to the monthly payments that would have been paid during such six month period); provided, however, that if the payment of the Severance Pay meets an exemption under Internal Revenue Code Section 409A concerning the timing of payment of severance compensation, then the payment of the Severance Pay will commence (or be paid, in the case of a change in control) upon Employee’s termination of employment. In addition, Company shall pay Employee (i) his pro rata portion of any annual bonus or other compensation to which he would have been entitled for the year during which the termination occurred, such payment to be made at such time that bonuses are paid to all employees, or if later, six (6) months after Employee’s termination of employment (unless an exception to § 409A applies); and (ii) Employee’s COBRA health insurance premium payments (for the same coverage that Employee had in place prior to his termination) for the duration of the COBRA continuation period, or if earlier, until the Employee becomes eligible for health insurance because of employment with a different employer. Employee shall only be paid Severance Pay, pro rata bonuses and COBRA health insurance premium payments under this Section if he signs an agreement containing a release of claims against the Company, in a form substantially similar to that included in Exhibit A, attached hereto and incorporated herein. Employee will cease to be an employee of the Company as of the date specified in the Notice of Termination, and he will not receive or accrue any benefits of employment after such date, except as provided herein. Severance Pay, pro rata bonuses and COBRA health insurance premium payments shall not be paid to the Employee if Employee owns, manages, operates, joins, contracts with, or is employed by or connected in any manner with (whether as principal, partner, shareholder, member, director, officer, employee, agent or otherwise), any business which is competitive to the business engaged in by the Company. For purposes of this Agreement, a business shall be deemed to be competitive to the business engaged in by the Company if such business is engaged in the same or similar business activities conducted by the Company in the same geographical area in which the Company conducts its business operations (or is actively pursuing business operations) at the time of Employee’s termination of employment.

For purposes of this section, a “Change in Control” shall be consistent with regulations issued under Internal Revenue Code section 409A (the “409A regulations”) and shall mean the occurrence of a “Change in the Ownership of the Company,” a “Change in Effective Control of the Company”, or a “Change in the Ownership of a Substantial Portion of the Company’s Assets.” A “Change in the Ownership of the Company” means the acquisition by any one person, or more than one person acting as a group, of the outstanding and issued common stock (“Shares”) of the Company that, together with Shares held by such person or group, constitutes more than 50 percent of the total voting power of the Shares of the Company (however, if any one person, or more than one person acting as a group, is considered to own more than 50 percent of the total voting power of the Shares of the Company, the acquisition of additional Shares by the same person or group shall not constitute a Change in the Ownership of the Company). A “Change in Effective Control of the Company” shall occur if either (i) any one person, or more than one person acting as a group, acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person or persons) ownership of Shares of the Company possessing 35 percent or more of the total voting power of the Shares of the Company (however, if a person, or more than one person acting as a group owns 35% of the

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total fair market value or total voting power of the Shares of the Company, the acquisition of additional Shares by such person or group shall not constitute a Change in Effective Control of the Company; or (ii) a majority of members of the Company’s board of directors is replaced during any 12-month period by directors whose appointment or election is not endorsed by a majority of the members of the Company’s board of directors prior to the date of the appointment or election. A “Change in the Ownership of a Substantial Portion of the Company’s Assets” occurs when any one person, or more than one person acting as a group, acquires (or has acquired during the 12-month period ending on the date of the most recent acquisition by such person or persons) assets from the Company that have a total gross fair market value (“gross fair market value” means the value of the assets of the Company, or the value of the assets being disposed of, determined without regard to any liabilities associated with such assets) equal to or more than 40 percent of the total gross fair market value of all of the assets of the Company immediately prior to such acquisition or acquisitions. For purposes of this section, the term “acting as a group” shall have the same meaning as defined in the 409A regulations.

b.             With Cause . The Company may terminate Employee’s employment under this Agreement at any time for cause effective immediately upon Notice of Termination. In the event the Company terminates this Agre