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SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A)
OF THE SECURITIES EXCHANGE ACT OF 1934
Filed by the Registrant / /
Filed by a Party other than the Registrant /X/
Check the appropriate box:
/ / Preliminary Proxy Statement / / Confidential, for Use of the
Commission Only (as permitted by
Rule 14a-6(e)(2))
/ / Definitive Proxy Statement
/ / Definitive Additional Materials
/X/ Soliciting Material Pursuant to Section 240.14a-11(c) or
Section 240.14a-12
Saratoga Resources, Inc.
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(Name of Registrant as Specified in its Charter)
Saratoga Resources, Inc. Stockholder's Committee
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(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
/ / $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2)
or Item 22(a)(2) of Schedule 14A.
/ / $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
/ / Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and
0-11.
(1) Title of each class of securities to which transaction applies:
N/A
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(2) Aggregate number of securities to which transaction applies:
N/A
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(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the filing fee
is calculated and state how it was determined):
N/A
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(4) Proposed maximum aggregate value of transaction:
N/A
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(5) Total fee paid:
N/A
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/ / Fee paid previously with preliminary materials.
/ / Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number, or
the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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SARATOGA RESOURCES, INC.
STOCKHOLDERS' COMMITTEE
C/O JOSEPH T. KAMINSKI
11931 WICKCHESTER, SUITE 209
HOUSTON, TX 77043
AUGUST 22, 1996
Dear Fellow Stockholders:
We are writing to you about important matters that may be proposed at
the 1996 Annual Meeting of Stockholders of Saratoga Resources, Inc. (the
"Company" or "Saratoga") scheduled for September 14, 1996.
On May 15, 1996, Joseph T. Kaminski filed a derivative lawsuit on
behalf of the Company [Cause No. 96-24469 in Harris County, Texas] which among
other things, seeks to recover for the benefit of the Company, actual and
exemplary damages against Defendants Thomas F. Cooke, Chief Operating Officer
and Chairman of the Board and stockholder, and Randall F. Dryer, Director and
stockholder; and asked the court to issue an injunction to protect the assets of
the Company until a stockholder meeting could be held. On that date, the court
signed a Temporary Restraining Order restraining Defendants Cooke and Dryer
from among other things: 1) transferring or moving funds or assets of Saratoga;
2) pledging or otherwise encumbering the assets of Saratoga; 3) incurring any
liabilities on behalf of Saratoga outside the ordinary course of business; and
4) interfering with Mr. Kaminski's access to corporate records and files.
On May 20, 1996, Saratoga, Cooke and Dryer agreed to an injunction
which enjoined them from among other things:
1. Interfering with Kaminski's rights as a stockholder and
director;
2. Conducting any business activity on behalf of Saratoga outside
the ordinary course of business; and
3. Requiring notification to Kaminski at least 72 hours prior to
any Board meeting, including providing an agenda.
This order was to stop Cooke and Dryer from breaching their fiduciary
duties without allowing Kaminski an opportunity to request court intervention.
Notwithstanding the aforementioned, Cooke and Dryer sought to remove Kaminski
as a director through a solicitation of a stockholder agreement (the
"Agreement") whereby votes were being solicited through what be believe were
false statements and a violation of federal proxy solicitation rules and
regulations.
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On July 8, 1996, a hearing was held for a Temporary Injunction and the
Appointment of Receiver. The court signed an order on July 15, 1996 and ruled
as follows:
1. "Defendant Saratoga Resources, Inc. is prohibited from paying
any attorneys' fees for or on behalf of Cooke or Dryer, in
this lawsuit or any other lawsuit unless payment of these fees
is in compliance with Delaware law;
2. Defendants are hereby enjoined from any continued solicitation
of the shareholders related in any manner to Plaintiff's
status as a shareholder or director unless such solicitation
is in compliance with Section 14(a) of the Securities Exchange
Act and the Proxy Rules and Regulations related thereto;
3. The "Agreement" marked as Exhibit 1 to the July 8, 1996
hearing is hereby declared void and unenforceable, together
with any signatures to an agreement similar to Exhibit 1. The
Agreement, and all solicitations by Defendants related in any
manner to such an agreement, were in violation of the
temporary injunction in place in this case and in violation of
Section 14(a) of the Securities Exchange Act and the Proxy
Rules;
4. Defendants are hereby ordered to communicate, in writing, to
each of the individuals or entities solicited by Defendants
regarding Exhibit 1, or a similar agreement, that the
agreement is void and unenforceable and solicitations with
regard to the agreement were in violation of prior orders of
this Court and the Proxy Rules;
5. Saratoga Resources, Inc. complete all required SEC filings
(8-K, 10-K, 10-Q) not later than August 1, 1996;
6. Defendant Saratoga Resources, Inc. is hereby ordered to submit
all documents which evidence payment of attorneys' fees and
expenses, or being billed for attorneys' fees and expenses,
related to the representation of Defendants by the following
law firms from October 31, 1995 to the present for an in
camera inspection by the Court by July 26, 1996.
7. Plaintiffs application for appointment of a receiver is
denied, without prejudice to Plaintiff's right to move at some
later date for appointment of a receiver;
8. Saratoga Resources, Inc. conduct its annual shareholders
meeting to approve a new business plan and elect new directors
no later than August 24, 1996."
On or about July 23, 1996, the Court modified the Supplemental
Temporary Injunction with respect to any findings concerning federal securities
laws or Temporary Injunction violations. However, all other Temporary
Injunction orders remained in place as written.
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Defendants Cooke and Dryer have not complied with the order to notify
each individual or entity solicited that the "Agreement" is void and
unenforceable. Again, this Agreement sought to solicit votes to remove Mr.
Kaminski from the Board of Directors as he is the only other Director and is
opposed to their actions.
In their proxy, Cooke and Dryer, as a majority of the current Board of
Directors, will seek to have their personal legal expenses paid by the Company
and further, ask the stockholders to ratify the personal expenses paid by the
Company on behalf of Cooke, which is one of the complaints in the Company's
derivative lawsuit against Cooke and Dryer.
Cooke and Dryer are determined to take control of the Company for the
purpose of promoting their self interest. This has been evidenced by their
continued violation of the Temporary Injunction and their continued abuse of
corporate assets.
FAILURE BY THE COMPANY'S STOCKHOLDERS TO ACT NOW MAY RESULT IN THE
CURRENT BOARD AND MANAGEMENT OBTAINING COMPLETE CONTROL OF THE COMPANY
AND PREVENT MEANINGFUL STOCKHOLDER INPUT ON THE FUTURE OPERATION OF
THE COMPANY.
The Saratoga stockholders should decide the future of the Company, and
we are determined to give you that opportunity. In the near future, you will
receive proxy materials from us that will give you the chance to vote FOR our
nominees to serve on the Board and FOR a change of direction in the Company
towards more effective leadership. ADDITIONALLY, WE WILL BE GIVING YOU THE
OPPORTUNITY TO VOTE NO TO CERTAIN OF THE PROPOSALS OF THE BOARD AND MANAGEMENT
OF SARATOGA THAT THEY WILL PROPOSE TO YOU IN THEIR PROXY, INCLUDING:
PROPOSAL 4: APPROVAL OF PAYMENTS OF LEGAL EXPENSES OF COOKE AND DRYER;
PROPOSAL 5: APPROVAL OF REIMBURSEMENT OF TRAVEL AND LIVING EXPENSES OF
COOKE; AND
PROPOSAL 6: AUTHORIZATION TO PROCEED WITH A BUSINESS PLAN.
KEEP MR. COOKE AND DR. DRYER FROM USING THE COMPANY FOR THEIR PERSONAL
BENEFIT AND WASTING THE RESOURCES OF THE COMPANY. Our nominees are committed
to operating the Company for the maximum benefit of all stockholders.
Our Nominees:
Joseph T. Kaminski, age 46, was one of the co-founders of Saratoga in
July 1990. Mr. Kaminski has been an exploration geophysicist for over 25 years
and has been involved in several start up companies and acquisitions in the oil
and gas industry. In 1971 he started his career at Amoco Production Company
and after seven years, resigned with the title of Senior Exploration
Geophysicist. After several years as an explorationist with three independent
oil and gas firms, he co-founded a company called Seismic Enterprises in 1982.
From the company's inception until 1987 Mr. Kaminski was the CEO and Chairman
of the Board. During his tenure, the company grew
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and was taken public in 1984 through an I.P.O. This company now called Seitel,
is traded on the New York Stock Exchange. After leaving Seitel, Mr. Kaminski
was involved in acquisitions of both private and publicly traded companies as
well as participation in oil & gas exploration though his wholly owned company,
Kaminski Enterprises. In 1990 he co-founded Saratoga as a private
corporation. In 1993 the company was merged with Sterling Resources, a
publicly traded company. From September 1993 until May 1996 Mr. Kaminski was
the President and CEO of Saratoga. Mr. Kaminski has been a member of the
Society of Exploration Geophysicist for over 25 years. Other professional
affiliations include The Houston Geophysical Society, Houston Geological
Society, American Association of Petroleum Geologists, Southwest CEO council,
Explorer member of the Texas Independent Producers and Royalty Owners and the
Texas Producers Forum.
Ronald F. Bearden, Ph.D., age 54, has for the last 23 years been
primarily engaged in financial consulting activities through R. F. Bearden
Associates, Inc. Most of his consulting activity has been with firms in which
the R. F. Bearden, Associates, Inc. has a significant ownership interest. In
most of the companies for which he acts as an investor and financial consultant
Dr. Bearden serves as an officer and director. Dr. Bearden usually consults
for businesses that are start-ups, high growth or financially troubled
companies requiring financial and operational restructuring. Dr. Bearden
became President and Chairman of this Company in 1988 with the purpose of
assisting in the reorganization of Primo, Inc. (the former name of the
predecessor company Sterling Resources, Inc). Dr. Bearden has served as a
Director of the Company from 1988 until 1993.
Kevin M. Smith, age 51, has over 20 years of experience in the oil and
gas industry as an exploration geophysicist. Mr. Smith was previously employed
by Amoco Production Company (former Pan American Petroleum) from 1966 to 1977.
He then joined R. Brewer & Company, a Houston based geophysical consulting
firm, in 1977 where he worked as a consultant, both domestic and international,
until 1984. Mr. Smith then formed his owned geophysical consulting and
petroleum exploration firm. In July 1990 Mr. Smith joined Saratoga as
Vice-President of exploration and is currently the fourth largest shareholder
of the Company. Mr. Smith is a member of the Society of Exploration
Geophysicists (S.E.G.), American Association of Petroleum Geologists
(A.A.P.G.), Geophysical Society of Houston (H.G.S.) and the Texas Independent
Producers and Royalty Owners Association (T.I.P.R.O.).
We believe that our nominees will provide the management and direction
necessary for all investors to realize the full value of the Company.
Our reasons for mounting this campaign are straightforward. We do not
believe that the current Board is running the Company for the benefit of its
stockholders.
SARATOGA STOCKHOLDERS OWN THE COMPANY. THE BOARD AND MANAGEMENT ARE
SUPPOSED TO WORK FOR YOU, THE STOCKHOLDER. WE BELIEVE THAT COOKE AND
DRYER HAVE FORGOTTEN FOR WHOM THEY WORK, AND ARE MORE CONCERNED WITH
THEIR PERSONAL MONETARY GAIN RATHER THAN THE COMPANY'S PERFORMANCE.
IN
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THE NEAR FUTURE, WE WILL BE GIVING YOU A CHANCE TO REMIND THEM TO WHOM
THEY ARE HELD ACCOUNTABLE.
Our proxy materials will be sent to you soon, along with more detailed
communications explaining our particular concerns and our belief that needed
change at Saratoga can only come from the approval of our director nominees in
conjunction with the negative vote regarding certain current management's
proposals.
PLEASE DO NOT SIGN ANY PROXY SENT TO YOU BY SARATOGA'S MANAGEMENT OR
ANY OTHER ENTITY PRIOR TO THE TIME YOU HAVE REVIEWED THE IMPORTANT INFORMATION
WE WILL SEND TO YOU.
Please take the time to read the materials to be provided to you. If
you have any questions or concerns, or would like to offer support to our
effort, do not hesitate to call Joseph T. Kaminski at (713) 556-1375.
We look forward to speaking with you as our efforts to realize
Saratoga's full potential move forward.
Sincerely yours,
/s/ JOSEPH T. KAMINSKI
Joseph T. Kaminski,
CHAIRMAN, SARATOGA STOCKHOLDERS' COMMITTEE
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INFORMATION CONCERNING
SARATOGA RESOURCES, INC. STOCKHOLDERS COMMITTEE
As required by the Securities and Exchange Commission, listed below
are the names, principal occupations or employment, and business addresses of
each member of Saratoga Resources, Inc. Stockholders Committee (the
"Committee") and each of the Committee's nominees for election as directors of
Saratoga Resources, Inc. ("Saratoga"). Also provided is the name and
description of the principal business of any corporation or other organization
at which such employment occurs. The number of shares of common stock of
Saratoga beneficially owned by each person is also noted.
Joseph T. Kaminski (Nominee) is the principal of Kaminski Enterprises
and a Director of Saratoga Resources Inc. His address is 11931 Wickchester,
Suite 209, Houston, Texas 77043. Mr. Kaminski beneficially owns 2,565,371
shares of stock which includes 100,000 warrants to purchase shares at $1.36 per
share.
Ronald F. Bearden (Nominee) is a principal of R. F. Bearden Associates
Inc., a consulting firm. His address is 2800 Post Oak Blvd., Suite 5260,
Houston, Texas 77056. Mr. Bearden beneficially owns 207,014 shares of stock
which includes 200,000 warrants to purchase stock at 120% of an established
offering price.
Kevin M. Smith (Nominee) is owner of Kevin M. Smith Inc. an exploration
consulting firm at 2000 S. Dairy Ashford, Suite 400, Houston, Texas 77077. Mr.
Smith beneficially owns 218,295 shares of stock.
Sandra Smith is affiliated with Kevin M. Smith, Inc. an exploration
consulting firm at 2000 S. Dairy Ashford, Suite 400, Houston, Texas 77077. Ms.
Smith beneficially owns 20,000 shares of stock.
Rebecca Bearden, wife of Ronald F. Bearden resides at 3350 McCue,
Suite 1103, Houston, Texas 77056. Ms. Bearden beneficially owns 80,667 shares
of stock.
Lobo Energy Inc., 2000 S. Diary Ashford, Suite 410, Houston, Texas
77077 beneficially owns 150,000 shares of stock. Mr. Kevin Smith currently
holds proxy to vote Lobo's shares but claims no beneficial ownership.
