SARATOGA RESOURCES, INC. FORM 10-QSB PAGE 1 OF 13
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM 10-QSB
[X] QUARTERLY REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
ACT OF 1934 For the quarterly period ended March 31, 1996
[ ] TRANSITION REPORT UNDER SECTION 13 OR 15(d) OF THE SECURITIES
EXCHANGE ACT OF 1934
Commission file number 0-11498
SARATOGA RESOURCES, INC.
(Exact name of small business issuer in its charter)
Delaware 76-0453392
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
2000 Dairy Ashford South, Suite 410 Houston, Texas 77077
(Address of principal executive offices, including Zip Code)
(713) 531-0022
(Registrant's telephone number, including area code)
1155 Dairy Ashford, Suite 600, Houston, Texas 77079
(Former name, former address and former fiscal year,
if changed since last report)
Indicate by check mark whether the registrant (1) has filed all
reports to be filed by Section 13 or 15 (d) of the Securities Exchange Act of
1934 during the preceding 12 months (or such shorter period that the registrant
was required to file such reports), and (2) has been subject to such filing
requirements for the past 90 days. Yes [X] No [ ]
APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS
DURING THE PRECEDING FIVE YEARS:
Indicate by check mark whether the registrant has filed all documents
and reports required to be filed by section 12, 13 or 15(d) of the Securities
Exchange Act of 1934 subsequent to distribution of securities under a plan
confirmed by a court. Yes [ ] No [ ]
As of July 19, 1996, there were 6,809,400 issued and outstanding
shares of Registrant's common stock, $.001 par value.
SARATOGA RESOURCES, INC. FORM 10-QSB PAGE 2 OF 13
SARATOGA RESOURCES, INC.
QUARTERLY REPORT ON FORM 10-QSB
INDEX PAGE NO.
PART I. Financial Information
Item 1. Financial Statements (Unaudited)
Consolidated Balance Sheet -
March 31, 1996 ............................................... 3
Consolidated Statements of Operations -
Three months ended March 31, 1996 and 1995 ................... 5
Consolidated Statements of Cash Flows -
Three months ended March 31, 1996 and 1995 ................... 6
Notes to Consolidated Financial Statements ..................... 7
Item 2. Management's Discussion and Analysis of
Financial Condition and Results of Operations ................ 10
PART II.Other Information ................................................. 12
Item 6. Exhibits and Reports on Form 8-K .................................. 12
Signatures ..................................................... 13
SARATOGA RESOURCES, INC. FORM 10-QSB PAGE 3 OF 13
PART I. - FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS
SARATOGA RESOURCES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET
AS OF MARCH 31, 1996
(In Thousands)
(Unaudited)
ASSETS
Current assets:
Cash ................................................. $ 604
Accounts receivables ................................. 427
Accounts receivable from related party --
Prepaid expenses ..................................... 41
Other ................................................ 15
Deferred income taxes ................................ --
Total current assets ............................................ 1,087
Property and equipment:
Oil and gas properties (full cost method) ........... 17,620
Equipment ............................................ 256
Less accumulated depletion,
depreciation and amortization ....................... (11,190)
--------
6,686
Other assets, net of accumulated amortization
of $117 .............................................. 236
--------
Total Assets .................................................... $ 8,009
========
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SARATOGA RESOURCES, INC. FORM 10-QSB PAGE 4 OF 13
SARATOGA RESOURCES, INC. AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEET (CONTINUED)
AS OF MARCH 31, 1996
(In Thousands)
(Unaudited)
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities:
Accounts payable and accrued liabilities ............ $ 2,796
Legal suspense ...................................... 305
Royalties Payable ................................... 192
Interest payable .................................... 1,090
Advance from partners ............................... 71
Current maturities of debt ......................... 13,662
--------
Total current liabilities ...................................... 18,116
Stockholders' equity
Common stock ........................................ 7
Treasury stock ...................................... (2)
Additional paid in capital .......................... 2,909
Retained deficit .................................... (13,021)
--------
Total stockholders' equity ..................................... (10,107)
Total Liabilities and Stockholders' Equity ..................... $ 8,009
========
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SARATOGA RESOURCES, INC. FORM 10-QSB PAGE 5 OF 13
SARATOGA RESOURCES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF OPERATIONS
(in thousands, except per share amounts)
(Unaudited)
THREE MONTHS ENDED
MARCH 31,
1996 1995
------- ------
Revenues:
Oil and gas ................................. $ 684 $ 421
Other ....................................... 1 14
------- -------
685 435
Costs and Expenses:
Production .................................. 271 307
Severance tax ............................... 43 21
Depletion, depreciation and amortization ... 362 245
General and administrative .................. 268 171
Interest expense ............................ 434 234
------- -------
1,378 978
------- -------
Net loss before taxes .................................. (693) (543)
Income tax benefit ..................................... 0 199
------- -------
Net loss ............................................... $ (693) $ (344)
======= =======
Net loss per share ..................................... $ (.10) $ (.05)
======= =======
Weighted average number of common shares outstanding ... 6,699 6,680
======= =======
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SARATOGA RESOURCES, INC. FORM 10-QSB PAGE 6 OF 13
SARATOGA RESOURCES, INC. AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(In Thousands)
(Unaudited)
THREE MONTHS ENDED
MARCH 31,
1996 1995
----- -------
CASH FLOWS FROM OPERATING ACTIVITIES:
Net loss ............................................... $(693) $ (344)
Adjustments to reconcile net loss to net
cash provided by (used in) operating activities:
Depreciation, depletion and amortization ............... 362 245
Deferred income taxes .................................. 0 (199)
Amortization of debt discount .......................... 23 37
Changes in operating assets and liabilities:
Decrease in accounts receivable ....................... (28) 106
Increase (decrease) in accounts payable and accrued
liabilities ......................................... 371 (643)
Other .................................................. 64 (57)
----- -------
NET CASH PROVIDED BY (USED IN) OPERATING ACTIVITIES ...... 99 (855)
----- -------
CASH FLOWS FROM INVESTING ACTIVITIES:
Property and equipment additions ....................... (39) (279)
Acquisition of oil and gas properties .................. 0 (4,642)
----- -------
NET CASH USED IN INVESTING ACTIVITIES .................... (39) (4,921)
----- -------
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from borrowings .............................. (60) 5,363
----- -------
NET CASH PROVIDED BY FINANCING ACTIVITIES ............... (60) 5,363
----- -------
NET (DECREASE) INCREASE IN CASH .......................... 0 (413)
CASH AT BEGINNING OF PERIOD .............................. 604 670
----- -------
CASH AT END OF PERIOD .................................... $ 604 $ 257
===== =======
SEE NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
SARATOGA RESOURCES, INC. FORM 10-QSB PAGE 7 OF 13
NOTES TO UNAUDITED CONSOLIDATED FINANCIAL STATEMENTS
NOTE 1 - ORGANIZATION AND SUMMARY OF SIGNIFICANT ACCOUNTING
POLICIES
ORGANIZATION: Saratoga Resources, Inc., a Delaware corporation, (the "Company",
"Saratoga", or the "Registrant") was merged with Sterling Resources Corporation
("Sterling") in February 1994. Sterling, formerly Primo Corporation, had been
incorporated in Utah on September 21, 1972.
The Company has been engaged in oil and gas exploration and
development of properties located in far Southwest and East Texas and in
Louisiana. Sterling had been a passive organization with no assets nor
liabilities until September 8, 1993. At that time, Sterling acquired all of the
outstanding shares of Saratoga Resources, Inc., a Texas corporation
("Saratoga-Texas"). The stockholders of Saratoga-Texas received 1,000,000 shares
of Sterling preferred stock and 100,000 shares of Sterling common stock. Shares
belonging to various Sterling stockholders were placed in a voting trust which,
along with voting rights of the stock issued to former Saratoga-Texas
stockholders, resulted in the former Saratoga-Texas stockholders exercising
voting control over 90% of the votes of Sterling's security holders. The
acquisition resulted in a complete reorganization of the Company and a change in
management. On January 22, 1994 the stockholders of the Company voted to 1)
change the name of the Company to Saratoga Resources, Inc.; 2) relocate the
domicile of the Company from Utah to Delaware; and, 3) institute a 1 for 30
reverse stock split on the Company's common stock. In addition, the preferred
stock of Sterling was converted into common stock.
On May 25, 1994, under the terms of a Stock Purchase Agreement,
Saratoga-Texas acquired 5,715 shares of common stock of Lobo Energy, Inc.
("LEI"). The shares acquired by Saratoga- Texas gave the Company 57.15% of the
common stock of LEI in exchange for a purchase price of $6,000,375 cash.
On March 31, 1995, Saratoga -Texas acquired the remaining 42.85%
(4,285 shares) of the common stock of LEI from Peter P. Pickup. The total price
paid by Saratoga-Texas for the purchase was approximately $5,401,000. As a
result of this acquisition, Saratoga-Texas controlled 100% of the common stock
outstanding of LEI.
These LEI acquisitions were accounted for on the purchase method of
accounting. The Company's consolidated statements of operations as of March 31,
1995 reflect Saratoga-Texas' proportional consolidation of LEI's assets,
liabilities, revenues and costs. With the acquisition of the remaining 42.85% of
the common stock of LEI, the Company's consolidated statement of operations for
the three months ended March 31, 1996 reflects 100% of LEI's revenues and costs.
GENERAL: The unaudited consolidated financial statements included herein have
been prepared pursuant to the rules and regulations of the Securities and
Exchange Commission and include all
SARATOGA RESOURCES, INC. FORM 10-QSB PAGE 8 OF 13
adjustments which, in the opinion of management, are necessary in order to make
the financial statements not misleading. The unaudited consolidated financial
statements included herein are those of the Company and its subsidiaries, all of
which are wholly owned. All significant intercompany accounts and transactions
have been eliminated in consolidation. For further information, refer to the
consolidated financial statements and footnotes thereto included in the
Company's annual report on Form 10-KSB for the transition period ended December
31, 1995.
NOTE 2 - DEBT
On March 30, 1995, the Company, Saratoga-Texas and LEI executed a
Credit Agreement ("Credit Agreement") with ING which, in part, refinanced the
existing LEI debt to ING. The cash portion of the purchase price for the
acquisition of LEI described in Note 1 was paid out of the proceeds of the loan
evidenced by the Credit Agreement. In the Credit Agreement, ING established two
credit facilities in favor of Saratoga-Texas in the combined maximum principal
amount of $19,000,000, subject to the borrowing base limitations set forth
therein. At March 31, 1996 an aggregate of $15,500,000 was available under these
facilities; $13,765,721 was advanced; and $13,397,410 was outstanding, net of
unamortized loan commitment fees of $368,311. All oil and gas properties owned
by the Company are pledged as collateral under the Credit Agreement and all
obligations to ING are also guaranteed by the Company and all of its
subsidiaries.
The Credit Agreement contained numerous covenants with respect to the
operation of the Company. One of the covenants provided that at no time shall
the Company's current liabilities, without including payments required under the
Credit Agreement, exceed the Company's current assets. Additionally, the
Company's net worth, (essentially defined as total tangible assets less total
liabilities, minus half of the net proceeds of an equity transaction), was not
to fall below $1,500,000. Also, the Company's general and administrative
expenses actually incurred and paid during any fiscal year was not to exceed
$1,600,000. At March 31, 1996, the company was in default of numerous covenants
associated with this Credit Agreement.
As discussed in Note 4, on May 7, 1996 in connection with a
Foreclosure Sale and Compromise and Settlement Agreement, a majority of the
assets (the "Interests") of Saratoga-Texas, LOI and LEI were sold to ING in
exchange for ING's forgiveness of all debt owed by the Company to ING. The
remainder of the Company's debt, consisting of a note payable to a stockholder,
note payable to an individual, and other note payable, will be settled with each
lender by the Trustee from the cash proceeds of the Foreclosure Sale, pursuant
to the Disbursement Agreement dated May 7, 1996, also discussed in Note 4.
NOTE 3 - LITIGATION
On May 13, 1996, the Company, along with two of its three directors,
Thomas F. Cooke ("Cooke") and Randall F. Dryer ("Dryer"), filed a lawsuit (the
"Company Lawsuit"), as amended, against the remaining director, Joseph T.
Kaminski ("Kaminski") [Cause No. 96-05540, SARATOGA RESOURCES, INC., THOMAS F.
COOKE AND RANDALL F. DRYER V. JOSEPH T. KAMINSKI, 261st Judicial
SARATOGA RESOURCES, INC. FORM 10-QSB PAGE 9 OF 13
District Court, Travis County, Texas]. The Company has filed this lawsuit
against Kaminski alleging fraud, breach of fiduciary duty, intentional and
negligent misrepresentation, and other claims.
On May 13, 1996, at the same time the "Company Lawsuit" was being
filed, Cooke and Dryer advised Kaminski that Kaminski was being terminated as
President of Saratoga, Kaminski having previously been terminated as Chief
Executive Officer of Saratoga by the Board of Directors on April 3, 1996. By
action of the Board of Directors on May 21, 1996, Kaminski was dismissed for
cause as President of Saratoga and its subsidiaries.
On May 15, 1996, Kaminski filed a lawsuit (the "Kaminski Lawsuit"), as
amended, against Cooke, Dryer, Dryer, Ltd. and the Company [Cause No. 96-24469,
JOSEPH T. KAMINSKI V. THOMAS F. COOKE, RANDALL F. DRYER, SARATOGA RESOURCES,
INC., AND DRYER, LTD., A TEXAS FAMILY PARTNERSHIP, 113th Judicial District
Court, Harris County, Texas]. Kaminski has filed this lawsuit individually and
derivatively as a shareholder of the Company and has alleged fraud, breach of
fiduciary duty, gross negligence, slander, libel per se, and other claims on the
part of Cooke and Dryer individually and as directors of the Company.
The Company continues to conduct its affairs in the ordinary course
of business pursuant to the terms and provisions of an Agreed Temporary
Injunction presented to the Court in the "Kaminski Lawsuit" on May 20, 1996.
The "Company Lawsuit" and "Kaminski Lawsuit" are both in the early
stages of development. While management of the Company believes at this time
that neither lawsuit will have a material adverse effect on the Company, it is
too early to make an accurate evaluation of potentially adverse effects, if any.
NOTE 4 - SUBSEQUENT EVENT
As of May 7, 1996, The Company owed $13,765,721 plus accrued interest
to ING under the Credit Agreement described in Note 2. The Company was in
default under the Credit Agreement and all obligations were due and payable in
full.
In connection with a Foreclosure Sale and pursuant to the terms and
provisions of a Compromise and Settlement Agreement dated May 7, 1996, a
majority of the assets (the "Interests") of Saratoga-Texas, LOI and LEI were
sold to ING in exchange for ING's forgiveness of all amounts owed under the
Credit Agreement.
Upon completion of the Foreclosure Sale on May 7, 1996, at which ING
was the highest bidder, ING concurrently sold the Interests to PrimeEnergy for
cash consideration in the amount of $7,180,000 less an adjustment for net
revenue due the purchaser from the effective date of the purchase (January 1,
1996) through May 7, 1996, not to exceed $372,000, plus additional
SARATOGA RESOURCES, INC. FORM 10-QSB PAGE10 OF 13
consideration as provided in that certain Purchase and Sale Agreement dated May
7, 1996, by and between ING and PrimeEnergy.
Upon receipt of the cash proceeds from the sale of the Interests by
ING to PrimeEnergy, ING deposited approximately $5,500,000 with the Trustee, of
which approximately $4,000,000 was set aside under that certain Disbursement
Agreement dated May 7, 1996, for the settlement of outstanding vendor claims and
other related liabilities of the Saratoga Companies. The remaining $1,500,000
has been paid to the Company and will be available for the Company to pursue
other business opportunities.
As a result of the above transaction, all amounts owed to ING have
been classified as current in the accompanying consolidated balance sheet. The
consolidated financial statements do not include any other adjustments that
would result from the disposal of assets and settlement of liabilities under the
terms of the Compromise and Settlement Agreement.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL
CONDITION AND RESULTS OF OPERATIONS
On March 30, 1995, the Company, Saratoga-Texas, LEI and ING entered
into the Credit Agreement to facilitate the settlement of a lawsuit brought by
Pickup against the Company and ING, and fund the acquisition by Saratoga-Texas
of the LEI assets previously owned by Pickup. Under the terms of the Credit
Agreement, ING established two credit facilities in favor of Saratoga-Texas in
the combined maximum principal amount of $19,000,000, subject to the borrowing
base limitations set forth therein. All of the Properties owned by the "Saratoga
Entities" were pledged as collateral under the Credit Agreement and all
obligations to ING were also guaranteed by the Company and all of its
subsidiaries. Funds obtained from these credit facilities were anticipated to be
used for the development of the Properties by the Company.
Subsequent to entering into the Credit Agreement, the Company engaged
ING Securities, a subsidiary of ING, to assist the Company in a private
placement of Company stock. It was anticipated that funds raised from such
private placement would enable the Company to meet its financial obligations
under the Credit Agreement. The private placement efforts were not successful.
Additionally, funds necessary for the development of the Properties were not
provided by ING under the Credit Agreement.
The failure of the private placement efforts combined with the lack
of availability of funds necessary for the development of its Properties placed
the Company in a severe financial crisis. In an attempt to salvage the maximum
value of the Saratoga Companies for the benefit of the other creditors (the
"Other Creditors") and the Company and its shareholders, the Saratoga Companies
spent several months examining and pursing various alternatives with respect to
(i) the possible refinancing and/or restructuring of the debt of the Saratoga
Companies, (ii) the sale of the Saratoga Companies or their underlying assets,
and (iii) the prosecution or settlement of certain potential claims against ING.
[The Company and Saratoga-Texas, Lobo Operating, Inc. (LOI) and LEI are
sometimes collectively referred to herein as the "Saratoga Companies".]
SARATOGA RESOURCES, INC. FORM 10-QSB PAGE 11 OF 13
Unable to meet its financial obligations under the Credit Agreement,
the Company received notices of default from ING, whereupon ING threatened to
foreclose its perfected first lien security interests in the Properties and
Interests. At the same time the Company was receiving notices of default from
ING, the Company was attempting to negotiate a transaction with PrimeEnergy
involving either a merger of the two entities or a sale of the assets of the
Saratoga Entities to PrimeEnergy. The situation with ING obviously complicated
the Company's efforts with PrimeEnergy, as it had with other companies with
which the Company had been involved in similar negotiations. [Saratoga-Texas,
LOI and LEI are sometimes collectively referred to herein as the "Saratoga
Entities".]
Facing what the Company believed to be an eminent foreclosure action
by ING which would restrict the Company's objectives and its ability to
consummate negotiations with PrimeEnergy, in April of 1996, the Saratoga
Companies filed an Original Petition and Application for Injunctive Relief
against ING and ING Securities, C96-399-D3 in the 341st Judicial District Court
of Webb County, Texas . Subsequently , the Company and ING entered into
discussions in an attempt to reach a final resolution of ING's rights under the
Credit Agreement and the Company's asserted claims .
In reviewing its options, the Company believed that the proceeds from
a contested foreclosure by ING would be substantially less than the debt owed
ING under the Credit Agreement, and that the Saratoga Companies would have no,
or virtually no, assets, the Other Creditors of the Saratoga Companies would not
be paid, and the stock of the Company would be worthless. Accordingly,
exercising its best business judgment, the Company determined that the best (and
in all probability the only) alternative available to the Saratoga Companies to
preserve value for the Other Creditors, the Company and its shareholders was to
consent, on its own behalf and as sole shareholder (directly or indirectly) of
the Saratoga Entities, to the compromise and settlement of the claims against
ING and ING Securities, and in connection therewith, the foreclosure by ING with
respect to all of the assets of the Saratoga Entities, all in accordance with
the terms and provisions of the Agreement dated May 7, 1996.
The Agreement provided for a Foreclosure Sale of a majority of the
assets (the "Interests") of the Saratoga Entities to ING pursuant to ING's
rights under the Credit Agreement. Upon completion of the Foreclosure Sale on
May 7, 1996, at which ING was the highest bidder, ING concurrently sold the
Interests to PrimeEnergy for $7,180,000 in cash and additional consideration as
provided in that certain Purchase and Sale Agreement dated May 7, 1996, by and
between ING and PrimeEnergy.
Upon receipt of the cash proceeds from the sale of the Interests by
ING to PrimeEnergy, ING deposited approximately $5,500,000 with the Trustee, of
which approximately $4,000,000 was set aside under the Disbursement Agreement
for the settlement of outstanding vendor debt and other related liabilities of
the Saratoga Companies. Upon the settlement of all such liabilities, the Company
anticipates that there will be no material liabilities going forward, other than
those incurred since May 7, 1996, in the ordinary course of business and certain
liabilities with respect to prior matters which the Company does not believe are
material.
SARATOGA RESOURCES, INC. FORM 10-QSB PAGE 12 OF 13
The Company was paid the remaining $1,500,000 by ING,
which amount is available to pursue new business opportunities or for other
proper corporate purposes.
The Board of Directors of the Company is in the process of
re-evaluating its business plan going forward. Among the alternatives being
considered are: (i) rebuilding the management team and continuing in the oil and
gas business; (ii) entering into a business combination with one or more
businesses, some of which are oil and gas companies and the remainder of which
are in unrelated businesses; and (iii) various other potential alternatives. The
Company has already begun a search for suitable business combination candidates.
The Board intends to carefully evaluate all such alternatives before making a
final recommendation of its business plan to the shareholders.
PART II. - OTHER INFORMATION
ITEM 1. LEGAL PROCEEDINGS
See Note 3 to Consolidated Financial Statements.
ITEM 2. CHANGES IN SECURITIES
See Notes 2, 3 and 4 to Consolidated Financial Statements.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K
(A) EXHIBITS.
NO. EXHIBIT DESCRIPTION
(3) ARTICLES OF INCORPORATION AND BY-LAWS:
3.1 Certificate of Incorporation of Registrant,
Saratoga Resources, Inc., filed with the Office
of the Secretary of the State of Delaware on
January 19, 1994. Incorporated by reference to
the Form 10-KSB filed February 3, 1995, filed
as Exhibit 3.1 thereto.
3.2 By-Laws of Registrant, Saratoga Resources,
Inc., a Delaware Corporation, adopted January
20, 1994. Incorporated by reference to the Form
10-KSB filed February 3, 1995, filed as
Exhibit 3.2 thereto.
SARATOGA RESOURCES, INC. FORM 10-QSB PAGE 13 OF 13
(10) MATERIAL CONTRACTS:
10.1 Compromise and Settlement Agreement dated May
7, 1996, by and between Saratoga Resources,
Inc. a Delaware corporation, Saratoga
Resources, Inc., a Texas corporation, Lobo
Operating, Inc., a Texas corporation, LEI,
Inc., a Texas corporation, Thomas F. Cooke,
Joseph T. Kaminski, Randall F. Dryer, and
Internationale Nederlanden (U.S.) Capital
Corporation, filed as Exhibit 1 to the
Company's Report on 8-K dated May 7, 1996 and
incorporated herein by reference.
10.2 Purchase and Sale Agreement dated May 7, 1996,
by and between Internationale Nederlanden
(U.S.) Capital Corporation and PrimeEnergy
Corporation, filed as Exhibit 2 to the
Company's Report on 8-K dated May 7, 1996 and
incorporated herein by reference.
10.3 Assignment and Bill of Sale dated May 7, 1996,
by and between Saratoga Resources, Inc., a
Delaware corporation and PrimeEnergy
Corporation, filed as Exhibit 3 to the
Company's Report on 8-K dated May 7, 1996 and
incorporated herein by reference.
(B) REPORTS ON FORM 8-K
(1) A Form 8-K dated May 7, 1996 was filed with the Securities
and Exchange Commission on July 16, 1996, reporting Item
2-Acquisition or Disposition of Assets, Item 4 - Change in
Registrant's Certifying Accountant , and Item 5-Other
Events- Pending Litigation.
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned hereunto duly authorized.
SARATOGA RESOURCES, INC.
By: \s\ THOMAS F. COOKE
Thomas F. Cooke
Chairman of the Board
Chief Executive Officer and
Principal Accounting and
Financial Officer
Date: July 31, 1996
