12 Nov 2008late filing notice▼ Bad
QUEST RESOURCE CORP notified the SEC that its quarterly report would be filed late.
Announcements, explained
Each one in plain English, with the numbers worked through for a shareholder.
7 Nov 2008material agreement▼ BadMajor
On November 4, 2008 Quest and its partnerships signed further lender amendments, again to waive possible breaches from the transfers by former CEO Cash and unsettled intercompany accounts. Quest's own $6m extra loan commitment is clarified to shrink dollar for dollar as Quest keeps asset-sale proceeds. Quest Cherokee's $45m second lien loan was extended from January 11, 2009 to September 30, 2009 at LIBOR plus 9.0% (3.5% floor), with $3.8m quarterly repayments, a $0.40 per unit cap on Quest Energy's quarterly distribution, minimum liquidity of $14m at March 31, 2009 and $20m at June 30, 2009, 2009 capex capped at $30m, and Quest Energy required to raise equity or debt or refinance by mid-2009. The Cherokee revolver had a $190m borrowing base with $183m borrowed and now costs LIBOR plus 4.0% in a transition period. Bluestem had $128m of $135m drawn, also at LIBOR plus 4% in transition. Intercompany amounts Quest owes Quest Energy must be repaid by February 27, 2009. These follow up the October waivers, and the subsidiaries' debt is now much costlier and more tightly restricted than the 2007-2008 terms. The filing text is truncated, so further Bluestem terms are not covered.
6 Nov 2008substantial holder notice● Neutral
Advisory Research, Inc.* ------------------------------------------------------------------ 2,100,615 Shares ----------------------------------------------- Each 7 Dispositive Power Reporting 0 Shares ----------------------------------------------- Person 8 Shared Dispositive Power With 3,100,615 Shares ------------------------------------------------------------------ 9 Aggregate Amount Beneficially Owned by Each Reporting Person 3,100,615 Shares ------------------------------------------------------------------ 10 Check if the Aggregate Amount in Row (9) Excludes Certain Shares [ ] (See Instructions) ------------------------------------------------------------------ 11 Percent of Class Represented by Amount in Row (9) 9.6% ------------------------------------------------------------------ 12 Type of Reporting Person IA ------------------------------------------------------------------ *The filing persons previously filed a Schedule 13D, as amended, with respect to this issuer. This Schedule 13G is filed solely to convert such Schedule 13D, as amended, into a Schedule 13G. ------------------ --------------------- 748349305 SCHEDULE 13G PAGE 3 OF 10 PAGES ------------------ --------------------- 1 Name of Reporting Person, Advisory Research Micro Cap Value Fund, L.P.* ------------------------------------------------------------------ 2,503,421 Shares ----------------------------------------------- Each 7 Dispositive Power Reporting 0 Shares ----------------------------------------------- Person 8 Shared Dispositive Power With 1,503,421 Shares ------------------------------------------------------------------ 9 Aggregate Amount Beneficially Owned by Each Reporting Person 1,503,421 Shares ------------------------------------------------------------------ 10 Check if the Aggregate Amount in Row (9) Excludes Certain Shares [ ] (See Instructions) ------------------------------------------------------------------ 11 Percent of Class Represented by Amount in Row (9) 4.6% ------------------------------------------------------------------ 12 Type of Reporting Person PN ------------------------------------------------------------------ *The filing persons previously filed a Schedule 13D, as amended, with respect to this issuer. This Schedule 13G is filed solely to convert such Schedule 13D, as amended, into a Schedule 13G. ------------------ --------------------- 748349305 SCHEDULE 13G PAGE 5 OF 10 PAGES ------------------ --------------------- Item 1 (a) Name of Issuer: Quest Resource Corporation Item 1 (b) Name of Issuer's Principal Executive Offices: 210 Park Avenue, Suite 2750 Oklahoma City, Oklahoma 73102 Item 2 (a) Person Filing: Advisory Research, Inc., Advisory Research Energy Fund, L.P. and Advisory Research Micro Cap Value Fund, L.P. Item 2 (b) Address: 180 North Stetson St., Suite 5500 Chicago, IL 60601 Item 2 (c) Citizenship: Advisory Research, Inc. - Delaware Advisory Research Energy Fund L.P. - Illinois Advisory Research Micro Cap Value Fund L.P.-Illinois Item 2 (d) Title of Class of Securities: Common Stock, par value $0.001 per share Item 2 (e) : 748349305 Item 3 If this statement is filed pursuant to Rules 13d-1(b) or 13d-2(b), check whether the person filing is a: (a) [ ] Broker or Dealer registered under Section 15 of the Act (b) [ ] Bank as defined in Section 3(a)(6) of the Act (c) [ ] Insurance Company as defined in Section 3(a)(19) of the Act (d) [ ] Investment Company registered under Section 8 of the Investment Company Act (e) [x] Investment Advisor in accordance with section 240.13d-1(b)(1)(ii)(E) (f) [ ] Employee Benefit Plan or Endowment Fund in accordance with section 240.13d-1(b) (1)(ii)(F) ------------------ --------------------- 748349305 SCHEDULE 13G PAGE 6 OF 10 PAGES ------------------ --------------------- (g) [ ] Parent Holding Company or Control Person in accordance with section 13d-1(b) (1)(ii)(G) (h) [ ] A savings association as defined in section 3(b) of the Federal Deposit Insurance Act (i) [ ] A church plan that is excluded from the definition of an investment company under section 3(c)(14) of the Investment Company Act of 1940 (j) [ ] Group, in accordance with 240.3d-1(b)(1) (ii)(J). **Advisory Research, Inc. is the investment adviser of Advisory Research Energy Fund, L.P. and Advisory Research Micro Cap Value Fund, L.P. Item 4 Ownership Provide the following information regarding the aggregate number and percentage of the class of securities of the issuer identified in Item 1. (a) Amount Beneficially Owned: Advisory Research, Inc. - 3,100,615 Advisory Research Energy Fund, L.P. - 945,089 Advisory Research Micro Cap Value Fund, L.P. - 1,503,421 (b) Percent of Class Advisory Research, Inc. - 9.6% Advisory Research Energy Fund, L.P. - 2.9% Advisory Research Micro Cap Value Fund, L.P. - 4.6% (c) Number of shares as to which reporting person has: (i) Sole power to vote or to direct the vote: Advisory Research, InC. - 0 Advisory Research Energy Fund, L.P. - 0 Advisory Research Micro Cap Value Fund, L.P. - 0 (ii) Shared power to vote or to direct the vote: Advisory Research, Inc. - 3,100,615 Advisory Research Energy Fund, L.P. - 945,089 Advisory Research Micro Cap Value Fund, L.P. - 1,503,421 (iii) Sole power to dispose or to direct the disposition of: Advisory Research, Inc. - 0 Advisory Research Energy Fund, L.P. - 0 Advisory Research Micro Cap Value Fund, L.P. - 0 (iv) Shared power to dispose or to direct the disposition of: Advisory Research, Inc. - 3,100,615 Advisory Research Energy Fund, L.P. - 945,089 Advisory Research Micro Cap Value Fund, L.P. - 1,503,421 ------------------ --------------------- 748349305 SCHEDULE 13G PAGE 7 OF 10 PAGES ------------------ --------------------- Item 5 Ownership of Five Percent or Less of a Class: If this statement is being filed to report the fact that as of the date hereof the reporting person has ceased to be the beneficial owner of more than five percent of the class of securities, check the following [ ] Item 6 Ownership of More than Five Percent on Behalf of Another Person: If any other person is known to have the right to receive or the power to direct the receipt of dividends from, or the proceeds from the sale of, such securities, a statement to that effect should be included in response to this item and, if such interest relates to more than five percent of the class, such person should be identified. A listing of the shareholders of an investment company registered under the Investment Company Act of 1940 or the beneficiaries of employee benefit plan, pension fund or endowment fund is not required. Not Applicable Item 7 Identification and Classification of the Subsidiary Which Acquired the Security being Reported on by the Parent Holding Company: If a parent holding company or control person has filed this schedule, pursuant to Rule 13d-1(b)(ii)(G), so indicate under Item 3(g) and attach an exhibit stating the identity and the Item 3 classification of the relevant subsidiary. If a parent holding company or control person has filed this schedule pursuant to Rule 13d-1(c) or Rule 13d-1(d), attach an exhibit stating the identifi- cation of the relevant subsidiary. Not Applicable Item 8 Identification and Classification if Members of the Group: If a group has filed this schedule pursuant to ss.240.13d-1(b)(1)(ii)(J), so indicate under Item 3(j) and attach an exhibit stating the identity and Item 3 classification of each member of the group. If a group has filed this schedule pursuant to Rule 13d-1(c) or Rule 13d-1(d), attach an exhibit stating the identity of each member of the group. See Exhibit B Item 9 Notice of Dissolution of Group: Notice of dissolution of a group may be furnished as an exhibit stating the date of the dissolution and that all further filings with respect to transactions in the security reported on will be filed, if required, by members of the group, in their individual capacity. See Item 5. Not Applicable Item 10 Certification By signing below I certify that, to the best of my knowledge and belief, the securities referred to above were acquired and are held in the ordinary course of business and were not acquired and are not held for the purpose of or with the effect of changing or influencing the control of the issuer of such securities and were not acquired and are not held in connection with or as a participant in any transaction having such purposes or effect. ------------------ --------------------- 748349305 SCHEDULE 13G PAGE 8 OF 10 PAGES ------------------ --------------------- SIGNATURES After reasonable inquiry and to the best of my knowledge and belief, I certify that the information set forth in this statement is true, complete and correct. Date: November 5, 2008 ADVISORY RESEARCH, INC disclosed a new substantial QUEST RESOURCE CORP shareholding (9.60% of votes).
31 Oct 2008debt financing▼ BadMajor
On October 24, 2008 Quest and RBC amended the July 2008 term loan to waive possible covenant breaches tied to 'questionable transfers of funds' by Jerry Cash, described as the company's former Chairman and CEO, and to late settling of intercompany accounts. The press release puts the transfers at about $10 million to an entity controlled by the former CEO. RBC added a $6m term loan due November 30, 2008 ($2m drawn, $4m conditional on amending the Quest Energy and Quest Midstream credit agreements). Interest rises to LIBOR plus 10% (3.5% floor), which the release puts at 13.5% on the existing loan and 14.35% on the new one. Quest also announced the sale of about 22,600 net undeveloped acres in Somerset County, Pennsylvania for about $6.8m, with proceeds going to repay the $2m and speed up principal payments. This reveals the departure of Cash, who led the company in prior filings, and much costlier borrowing; the filing does not say how or why he left.
29 Oct 2008auditor change● Neutral
On October 23, 2008 Quest's board approved appointing UHY LLP as auditor for the year ending December 31, 2008, and an engagement letter was signed October 28. This ends the search that began when Eide Bailly resigned. The filing says UHY had not been consulted on accounting or audit matters beforehand.
2 Oct 2008auditor change● Neutral
This amendment repeats the October 1 report of Eide Bailly's resignation and adds only the October 1, 2008 press release (issued jointly with Quest Energy Partners and Quest Midstream Partners) announcing the resignation and the search for a new auditor. It adds no new facts beyond that.
1 Oct 2008auditor change▼ BadMajor
Eide Bailly, engaged only on August 1, 2008, told Quest on September 25 that it is resigning as auditor, effective on the earlier of the filing of the September 30, 2008 quarterly report or November 10, 2008. The filing says there were no disagreements and no reportable events from its review of the June 2008 quarter, and that Quest is still looking for a new auditor to audit future periods and 'any restated financial statements relating to prior periods'. The filing gives no reason for the resignation; the mention of possible restatements is stated but not explained.
3 Sept 2008listing compliance notice▼ Bad
QUEST RESOURCE CORP withdrew a registration statement, abandoning the offering it covered.
28 Aug 2008listing compliance notice● Neutral
On August 26, 2008 Nasdaq told Quest it no longer met the rule requiring three independent directors on its audit committee, after Bob Alexander resigned on August 22, leaving two members. Quest fixed this on August 27 by appointing existing director William H. Damon III (a director since April 2007), so the notice was resolved within days. The filing does not give a reason for Mr. Alexander's resignation.
8 Aug 2008substantial holder notice● Neutral
HEARTLAND ADVISORS, INC. #, WILLIAM J. NASGOVITZ reported a QUEST RESOURCE CORP shareholding of 1,468,700 shares (4.50% of votes) in a periodic institutional filing.
8 Aug 2008substantial holder notice● Neutral
HEARTLAND ADVISORS, INC. #, WILLIAM J. NASGOVITZ reported a QUEST RESOURCE CORP shareholding of 1,468,700 shares (4.50% of votes) in a periodic institutional filing.
7 Aug 2008auditor change● Neutral
Quest's auditor, Murrell, Hall, McIntosh & Co., merged into Eide Bailly effective August 1, 2008, and Quest engaged Eide Bailly as its auditor that day with Audit Committee approval. The filing reports no adverse or qualified opinions for 2007 and 2006 and no disagreements with the old auditor, so this is a change of name and firm rather than a dispute.
16 July 2008asset acquisition disposition▼ BadMajor
On July 11, 2008 Quest completed the PetroEdge WV purchase (renamed Quest Eastern Resource LLC) and immediately agreed to sell its wellbores and related assets for proved developed reserves in West Virginia and New York to Quest Cherokee for about $71.6m. Quest also converted its $50m RBC revolver into a $35m term loan due July 11, 2010 (LIBOR+5.0%, $1.5m quarterly payments from September 30, 2008, fully drawn, secured by Quest's assets other than the two partnerships) with covenants of interest coverage at least 2.5x and leverage at most 2.0x from September 30, 2008. Quest Cherokee also took a six-month $45m second lien term loan (LIBOR+6.5%, rising to 7.0% after October 11, 2008). The new debt is much more expensive than the Cherokee facility priced in November 2007.
2 July 2008securities registration● Neutral
QUEST RESOURCE CORP filed the final prospectus for a registered offering.
2 July 2008material agreement● NeutralMajor
On July 1, 2008 Quest agreed with RBC Capital Markets and other underwriters to sell 8,800,000 new shares at $10.25 each, with a 30-day option for up to 1,320,000 more. The filing ties this to the equity offering planned to fund the PetroEdge purchase only indirectly, via the earlier press release; it doesn't state the use of proceeds itself. It adds new shares for existing holders, and the filing notes an RBC affiliate also lends to Quest ($50m revolver, to become a $35m term loan) and to Quest Energy Partners and Quest Midstream Partners, and will be lender on a $45m bridge loan to Quest Energy.
24 June 2008securities registration● Neutral
QUEST RESOURCE CORP registered additional securities for an offering already underway.
24 June 2008securities registration● Neutral
QUEST RESOURCE CORP filed the final prospectus for a registered offering.
19 June 2008material agreement● Neutral
This amendment to the June 10, 2008 filing only replaces the wrong Exhibit 2.1 with the correct PetroEdge purchase agreement; it repeats the original text of the roughly $140m PetroEdge acquisition and adds no new terms.
10 June 2008material agreement● NeutralMajor
On June 5, 2008 Quest agreed to buy PetroEdge Resources (WV) LLC from PetroEdge Resources Partners for about $140m cash (subject to adjustment; $5m deposited), adding roughly 78,000 net acres in West Virginia, Pennsylvania and New York, about 100 Bcfe of proved reserves, with closing expected by July 11, 2008. On June 4 Quest Oil & Gas also paid $4m for a farmout with Bradley Energy on about 32,000 acres in Potter County, Pennsylvania, with a one-year option to buy the deep rights for a further $6.5m. The attached press release says Quest plans to fund the purchase from a planned equity offering and from selling the proved developed reserves to Quest Energy Partners. This replaces the Pinnacle deal with a different push into Appalachia (Marcellus Shale).
19 May 2008material agreement termination● NeutralMajor
The Pinnacle Gas Resources merger agreement was terminated on May 16, 2008 because the deal was not completed by that date; either side could terminate then, and Quest owes no termination fee. This ends the merger thread that began in October 2007, so the planned issuance of shares to Pinnacle holders will not happen. The filing doesn't say why the deal wasn't completed. It also furnishes first-quarter 2008 results (no figures in the text) and announces a letter of intent with a private company for a farm-out giving Quest rights to develop about 30,000 net acres in Pennsylvania for one year.
23 Apr 2008material agreement▼ BadMajor
Effective April 15, 2008, the lenders to the Quest Cherokee credit agreement (not Quest itself) amended it: maturity moves from November 15, 2012 to November 15, 2010 and interest rises by 1%, to LIBOR plus 2.25%-2.875%. Royal Bank of Canada used its 'market flex' rights because it could not sell down its commitment to its desired hold amount; the option to expand the $250m facility to $350m was eliminated. The filing says that, given lower LIBOR, the increase does not currently change the partnership's 2008 interest expense guidance. This makes the November 2007 refinancing shorter and costlier.
10 Apr 2008substantial holder notice● Neutral
Wellington Management Company, LLP reported no remaining QUEST RESOURCE CORP shareholding in its periodic institutional filing.
19 Mar 2008substantial holder notice● Neutral
ADVISORY RESEARCH, INC., ADVISORY RESEARCH ENERGY FUND, L.P., ADVISORY RESEARCH MICRO CAP VALUE FUND, L.P. reported a QUEST RESOURCE CORP shareholding of 2,779,791 shares (11.90% of votes) in a periodic institutional filing.
18 Mar 2008substantial holder notice● Neutral
ADVISORY RESEARCH, INC., ADVISORY RESEARCH ENERGY FUND, L.P., ADVISORY RESEARCH MICRO CAP VALUE FUND, L.P. reported a QUEST RESOURCE CORP shareholding of 2,530,391 shares (10.80% of votes) in a periodic institutional filing.
29 Feb 2008substantial holder notice● Neutral
ADVISORY RESEARCH, INC., ADVISORY RESEARCH ENERGY FUND, L.P., ADVISORY RESEARCH MICRO CAP VALUE FUND, L.P. reported a QUEST RESOURCE CORP shareholding of 2,197,391 shares (9.80% of votes) in a periodic institutional filing.
14 Feb 2008substantial holder notice● Neutral
Wellington Management Company, LLP reported a QUEST RESOURCE CORP shareholding of 2,102,300 shares (9.35% of votes) in a periodic institutional filing.
8 Feb 2008substantial holder notice● Neutral
HEARTLAND ADVISORS, INC. #, WILLIAM J. NASGOVITZ disclosed a new substantial QUEST RESOURCE CORP shareholding (7.70% of votes).
7 Feb 2008substantial holder notice● Neutral
Scott Bedford reported no remaining QUEST RESOURCE CORP shareholding in its periodic institutional filing.
7 Feb 2008business combination● NeutralMajor
On February 6, 2008 Quest filed the registration statement (Form S-4) and preliminary joint proxy for the Pinnacle Gas Resources merger on the amended terms: 0.5278 Quest shares per Pinnacle share, leaving former Pinnacle holders with about 39.5%. It registers 15,781,617 new Quest shares and asks both companies' holders to vote at special meetings (dates blank); Quest holders also vote on raising the 2005 Omnibus Stock Award Plan share pool from 2,200,000 to 5,000,000. This continues the merger thread and starts the formal approval process.
6 Feb 2008business combination▲ GoodMajor
On February 6, 2008 Quest and Pinnacle restated their merger agreement, cutting the exchange ratio from 0.6584 to 0.5278 Quest shares per Pinnacle share. Current Quest holders would now own about 60.5% (up from 55%) and Pinnacle holders about 39.5%, and the surviving company becomes Quest Western Resource Corporation. The board would have six directors (four Quest, two Pinnacle). The termination fee stays $3.0m, with a $5.0m fee in certain limited circumstances if Pinnacle terminates. Quest directors agreed to vote for the deal, and the stock plan was amended to bar option repricing. This revises the October 2007 terms in Quest holders' favour on dilution.