Exhibit 10.1

FIRST AMENDMENT TO
Amended and Restated Credit AGREEMENT

THIS FIRST AMENDMENT TO AMENDED AND RESTATED CREDIT AGREEMENT (this “Amendment”) dated as of May 14, 2010, is among Saratoga Resources, Inc., a Texas corporation (“Saratoga”), Harvest Oil & Gas, LLC, a Louisiana limited liability company, (“HOG”), The Harvest Group LLC, a Louisiana limited liability company, (“THG”), Lobo Operating, Inc., a Texas corporation, (“Lobo”), and Lobo Resources, Inc., a Texas corporation, (“LRI”), (Saratoga, HOG, THG, Lobo and LRI are collectively referred to as, “Borrowers”), Wayzata Investment Partners LLC, a Delaware limited liability company in its capacity as successor administrative agent (“Administrative Agent”), and the Lenders signatory hereto (collectively, the “Lenders”).

RECITALS

WHEREAS, Borrowers and Macquarie Bank Limited (“Original Lender”) entered into that certain Amended and Restated Credit Agreement dated as of July 14, 2008 (as amended, supplemented or modified from time to time, including as amended by this Amendment, the “Credit Agreement”).

WHEREAS, Borrowers filed voluntary petitions for relief under Chapter 11, Title 11, United States Code, on March 31, 2009, in the United States Bankruptcy Court for the Western District of Louisiana (the “Bankruptcy Court”), which cases are being jointly administered under Case No. 09-50397 (the “Chapter 11 Case”).

WHEREAS, on February 11, 2010, Original Lender (i) assigned all of its right, title and interest in and to the Obligations and the Loan Documents to Wayzata Opportunities Fund, LLC and Wayzata Opportunities Fund II, L.P. (collectively, the “Wayzata Lenders”), and (ii) resigned as administrative agent under the Loan Documents.

WHEREAS, the Wayzata Lenders desire to appoint Wayzata Investment Partners LLC as the successor administrative agent under the Loan Documents.

WHEREAS, in connection with Borrowers’ consummation of the plan of reorganization in the Chapter 11 Case entitled “Third Amended Plan of Reorganization as Jointly Proposed by the Debtors, Macquarie Americas Corp., and the Official Committee of Equity Security Holders (as Modified as of March 31, 2010),” as such plan may be modified or amended from time to time, Borrowers desire to amend, restate, modify and ratify certain provisions of the Credit Agreement, and the parties have agreed to enter into this Amendment for such purpose.

NOW, THEREFORE, in consideration of the premises and mutual covenants and agreements contained herein and for other good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged, the parties hereto hereby agree as follows:

1.

Amendment.  Effective as of the Effective Date (defined below), the Credit Agreement is hereby amended as follows:

a.

The definition of “Acceptable Commodity Hedging Agreements” in Section 1.1 of the Credit Agreement is amended and restated as follows:

exhibit 10.1

“Acceptable Commodity Hedging Agreements” means Commodity Hedging Agreements meeting all of the following criteria:

(i)

The notional quantity of Crude Oil and Natural Gas subject to Commodity Hedging Agreements by the Borrower and its Subsidiaries, at the time of entering into such Commodity Hedging Agreements, shall not be, without the prior written approval of the Required Lenders, greater than 60% of the projected monthly production of Crude Oil or greater than 60% of the projected monthly production of Natural Gas (as applicable) for a period not exceeding the Final Maturity Date from the Proved Developed Producing Oil and Gas Properties of the Borrower and its Subsidiaries as determined by the Administrative Agent based on the most recent Reserve Report;

(ii)

Any counterparty must be an Approved Counterparty;

(iii)

the Commodity Hedging Agreement shall not contain any anti-assignment provisions restricting the Borrower or its Subsidiaries or if such Commodity Hedging Agreement contains anti-assignment provisions which cannot be removed, such provisions shall be modified to read substantially as follows:  “The interest and obligations arising from this agreement are non-transferable and non-assignable, except that [name of Person] may assign and grant a security interest in its rights and interests hereunder to a contractual collateral agent for itself and certain other lenders (collectively, “Lenders”) as security for present and future obligations of [name of Person] to the Lenders.  Until hedge provider is notified in writing by such collateral agent, to pay to such collateral agent, amounts due [name of Person] hereunder, hedge provider may continue to make such payments to [name of Person].”;

(iv)

The Administrative Agent shall have received for the benefit of the Lenders first and prior perfected security interests pursuant to security agreements in form and substance reasonably satisfactory to the Administrative Agent in the right, title and interest of such Person in and to the Commodity Hedging Agreements of such Person;

(v)

The Borrower or its Subsidiaries will not sell any calls other than calls corresponding to an existing permitted collar already executed or being executed in conjunction with such purchased call; and

(vi)

The Commodity Hedging Agreement is entered into in the ordinary course of business for the purpose of protecting against fluctuations in commodity prices or commodity basis risk and not for purposes of speculation.

b.

The definition of “Administrative Agent” in Section 1.1 of the Credit Agreement is amended and restated as follows:

“Administrative Agent” means Wayzata Investment Partners LLC, in its capacity as contractual representative of the Lenders pursuant to Article XI, and any successor Administrative Agent appointed pursuant to Article XI.

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c.

The definition of “Annualized EBITDA” in Section 1.1 of the Credit Agreement is amended and restated as follows:

“Annualized EBITDA” means (i) for the quarter ending June 30, 2010, the product of 4 times the Borrower’s EBITDA for the three months ending June 30, 2010, (ii) for the quarter ending September 30, 2010, the product of 2 times the Borrower’s EBITDA for the six months ending September 30, 2010, (iii) for the quarter ending December 31, 2010, the product of 4/3 times the Borrower’s EBITDA for the nine months ending December 31, 2010, and (iv) for any quarter ending thereafter, the Borrower’s EBITDA for the twelve month period ending on the last day of such quarter.

d.

The definition of “Applicable Margin” in Section 1.1 of the Credit Agreement is amended and restated as follows:

“Applicable Margin” means 2.00%.

e.

The definition of “Approved Counterparties” in Section 1.1 of the Credit Agreement is amended and restated as follows:

“Approved Counterparties” means (a) any of JPMorgan Chase Bank, N.A., Wells Fargo Bank, N.A., Goldman Sachs & Co. and any of their respective Affiliates, provided, that, at the time of entering into any Hedging Agreement such person has a credit rating of “A3” or higher from Moody’s or “A-” or higher from S&P, or (b) a Lender or an Affiliate of a Lender.

f.

The definition of “Base Rate” in Section 1.1 of the Credit Agreement is amended and restated as follows:

“Base Rate” means, at any time, the per annum variable rate of interest equal to the prime rate of interest as published by The Wall Street Journal (or its successor publication).

g.

Section 1.1 of the Credit Agreement is amended by adding the following definition of “Cash Secured Letters of Credit”:

“Cash Secured Letters of Credit” means the following letters of credit previously issued under the Credit Agreement and fully cash collateralized pursuant to Loans with respect thereto:  (i) letter of credit number S00052005 issued by The Bank of New York (guaranteed by Macquarie Bank Limited) to the Louisiana Office of Conservation in a stated amount of $1,925,360.00; (ii) letter of credit number 278/08/05 issued by Macquarie Bank Limited to Chevron USA Inc. in a stated amount of $7,000,000.00; and (iii) letter of credit number 295/05/06 issued by Macquarie Bank Limited to the Estate of William G. Helis in a stated amount of $750,000.00.

h.

Section 1.1 of the Credit Agreement is amended by adding the following definition of “Chapter 11 Case”:

“Chapter 11 Case” means the proceedings for relief under Chapter 11, Title 11, United States Code, filed by Borrower and the Designated Borrowers on March 31, 2009, in the United States Bankruptcy Court for the Western District of Louisiana, which cases are being jointly administered under Case No. 09-50397.

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i.

The definition of “Current Assets” in Section 1.1 of the Credit Agreement is hereby amended and restated as follows:

“Current Assets” of any Person means, at any date, the current assets of the Borrower and its Consolidated Subsidiaries.  For the avoidance of doubt, Current Assets shall exclude any non-cash amounts (and deferred taxes relating thereto) arising from marked to market adjustments under Hedging Agreements as a result of the application of GAAP.

j.

The definition of “Current Liabilities” in Section 1.1 of the Credit Agreement is hereby amended and restated as follows:

“Current Liabilities” of any Person means, at any date, the current liabilities of the Borrower and its Consolidated Subsidiaries, excluding (a) the current portion of the Loans and Letters of Credit outstanding hereunder, the loans under the Term Loan Facility, and Plan of Reorganization Debt, and (b) for the fiscal quarters beginning April 1, 2010 and June 1, 2010, liabilities for restructuring expenses not to exceed $4,000,000 in the aggregate associated with the Chapter 11 Case.  For the avoidance of doubt, Current Liabilities shall exclude any non-cash amounts (and deferred taxes relating thereto) arising from marked to market adjustments under Hedging Agreements as a result of the application of GAAP.

k.

The definition of “Deposit Account Control Agreement” in Section 1.1 of the Credit Agreement is amended by adding “in its reasonable discretion” immediately after “acceptable to Administrative Agent”.

l.

The definition of “EBITDA” in Section 1.1 of the Credit Agreement is amended and restated as follows:

“EBITDA” means, for any applicable period and with the respect to the Borrower and its Consolidated Subsidiaries, the sum of (a) Net Income, plus (b) to the extent deducted in determining Net Income, the sum of (i) amounts attributable to amortization, depletion and depreciation of assets, (ii) income tax expense, and (iii) Interest Expense for such period; provided, that for the quarters ending June 30, 2010 and September 30, 2010 only, an add back for restructuring expenses associated with the Chapter 11 Case not to exceed $4,000,000 in the aggregate will be permitted.

m.

The definitions of “Final Maturity Date” and “Final Maturity” in Section 1.1 of the Credit Agreement are amended and restated as follows:

“Final Maturity Date” or “Final Maturity” means April 30, 2012, or such earlier date as the maturity of the Obligations is accelerated in accordance with Section 8.1.

n.

The definition of “Issuer” in Section 1.1 of the Credit Agreement is amended and restated as follows:

“Issuer” means any Lender or any other Person approved by the Administrative Agent that issues or guarantees Letters of Credit pursuant to the terms of this Agreement.

o.

The definition of “Letter of Credit” in Section 1.1 of the Credit Agreement is amended and restated as follows:

“Letter of Credit” means (a) any letter of credit issued pursuant to this Agreement after the effective date of the Plan of Reorganization, and (b) any guarantee given by a Lender or an Affiliate thereof to an issuer providing such letter of credit for the account of the Borrower or any Designated Borrower.  The term Letter of Credit excludes the Cash Secured Letters of Credit.

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p.

The definition of “Letter of Credit Commitment Amount” in Section 1.1 of the Credit Agreement is amended and restated as follows:

“Letter of Credit Commitment Amount” means, on any date, a maximum amount of $10,159,128, as such amount may be permanently reduced from time to time pursuant to Section 2.9.3; provided, that the Letter of Credit Commitment Amount (a) may only be utilized for the replacement of Cash Secured Letters of Credit with Letters of Credit and (b) shall be automatically reduced by the stated amount of each Cash Secured Letter of Credit that is either cancelled without replacement or is replaced by a letter of credit issued outside of the Credit Agreement.

q.

The definition of “Material Adverse Effect” in Section 1.1 of the Credit Agreement and Section 8.1.4 of the Credit Agreement are both amended by adding “with the exception of the Chapter 11 Case,”  immediately after “the Borrower and its Subsidiaries” in the definition of “Material Adverse Effect” and immediately before “the Borrower” in Section 8.1.4.

r.

The definition of “Net Income” in Section 1.1 of the Credit Agreement is amended and restated as follows:

“Net Income” means, for any period, the aggregate of all amounts that would be included as net income (or loss) on the consolidated financial statements of the Borrower and its Subsidiaries for such period, but shall exclude effects on net income attributable to any current non-cash income or expense (including in respect of Hedging Agreements) described in or calculated pursuant to the requirements of applicable Statements of Financial Accounting Standards, as amended (provided that, for the avoidance of doubt, the calculation of Net Income shall include any income or expense in respect of the termination of any Hedging Agreement).

s.

Clause (c) of the definition of “Obligations” in Section 1.1 of the Credit Agreement is amended and restated as follows:

(c) all other obligations and liabilities of the Borrower and any of its Subsidiaries to any Approved Counterparty relating to Acceptable Commodity Hedging Agreements (in the case of a Lender, whether or not such Person is a Lender at the time of entering into the Hedging Agreements or remains a Lender hereunder), and

t.

The definitions of “Permitted Debt” and “Term Loan Facility” in Section 1.1 of the Credit Agreement are amended by replacing “$97,500,000” with “$127,500,000.”

u.

The definition of “Permitted Debt” in Section 1.1 of the Credit Agreement is amended by adding the following in subsection (g) of the definition immediately after “Intercreditor Agreement”: “, and Plan of Reorganization Debt not to exceed $6,000,000 at any time”.

v.

Clause (n) of the definition of “Permitted Liens” in Section 1.1 of the Credit Agreement is amended and restated as follows:

(n)  Liens securing the Debt permitted pursuant to clause (g) of the definition of “Permitted Debt” (other than Debt owing to holders of Allowed Claims in Classes 6 and 7 and Allowed Priority Unsecured Tax Claims of Plan of Reorganization Debt ).

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w.

Section 1.1 of the Credit Agreement is amended by adding the following definition of “Plan of Reorganization”:

“Plan of Reorganization” means the plan of reorganization entitled “Third Amended Plan of Reorganization as Jointly Proposed by the Debtors, Macquarie Americas Corp., and the Official Committee of Equity Security Holders (as Modified as of March 31, 2010),” as such plan may be modified or amended from time to time, filed by the Borrower and its Subsidiaries, as approved by the U.S. Bankruptcy Court for the Western District of Louisiana in the Chapter 11 Case.

x.

Section 1.1 of the Credit Agreement is amended by adding the following definition of “Plan of Reorganization Debt”:

“Plan of Reorganization Debt” means Debt to holders of Allowed Claims in Classes 4, 5, 6, and 7 and Allowed Priority Unsecured Tax Claims (as those terms are defined in the Plan of Reorganization) pursuant to the terms of the Plan of Reorganization.

y.

The definition of “PV10 Value” in Section 1.1 of the Credit Agreement is amended and restated as follows:

“PV10 Value” means, as of any date of determination, as to any Person the present value, discounted at a rate of 10%, of the future net revenues expected to accrue to such Person’s interests in its Oil and Gas Properties during the remaining expected economic lives of such properties as reasonably determined by the Administrative Agent in connection with the most recently completed Borrowing Base.  Each calculation of such expected future net revenues shall be made in accordance with the then existing standards of the Society of Petroleum Engineers and (a) with appropriate adjustments made for (i) severance and ad valorem taxes, (ii) operating, gathering, transportation and marketing costs required for the production and sale of such reserves and (iii) risk associated with such future net revenues as determined in the reasonable discretion of the Administrative Agent and (b) assuming for the purpose of this definition that future produced volumes of oil and gas will be sold (i) in the case of unhedged volumes, at the 24 month NYMEX strip (i.e., the average of the prices quoted on the New York Mercantile Exchange for WTI crude oil or Henry Hub natural gas for the upcoming 24 contract months following the time of calculation of PV10 Value), (ii) in the case of volumes subject to a swap or other fixed priced hedge, at the applicable fixed price and (iii) in the case of volumes subject to a floor or ceiling hedge (including a collar), at the price set out in the preceding clause (b)(i), but not to exceed such ceiling or to be less than such floor.

z.

The definition of “Reserve Report” in Section 1.1 of the Credit Agreement is amended by replacing “SEC” with “Society of Petroleum Engineers”.

aa.

The definition of “Required Lenders” in Section 1.1 of the Credit Agreement is amended and restated as follows:

“Required Lenders” means Lenders in the aggregate having at least 66-2/3% of the Aggregate Commitment or, if the Aggregate Commitment has been terminated, Lenders in the aggregate holding at least 66-2/3% of the Total Exposure Amount.

bb.

The definition of “Total Debt” in Section 1.1 of the Credit Agreement is amended by replacing “Statement of Financial Accounting Standards 133, 137, 138 and 143, in each case” with “applicable Statements of Financial Accounting Standards,”.

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cc.

Section 2.7.2 of the Credit Agreement is amended and restated as follows:

2.7.2

Administration Fee.  The Borrower agrees to pay to the Lenders pro rata an annual administration fee in the amount of $30,000.  Such fee shall be payable annually in advance (a) on the date hereof and (b) on each anniversary thereof until the date on which the Commitments are terminated and the facility hereunder is terminated in full.

dd.

Section 2.7.3 of the Credit Agreement is amended and restated as follows:

2.7.3

Letter of Credit Fee.  The Borrower agrees to pay to the Administrative Agent, for the pro rata account of each Lender, a Letter of Credit fee in a per annum amount equal to (a) 2.75% or, if applicable, such higher rate as is specified in Section 3.4, multiplied by (b) the Stated Amount of each such Letter of Credit, such fees being payable quarterly in arrears on each Quarterly Payment Date and on the Final Maturity Date.  For the avoidance of doubt, no fees shall be due under this Section in respect of the Cash Secured Letters of Credit.

ee.

(i) Sections 2.8.2, 2.8.3 and 7.2.2(e) of the Credit Agreement are each amended by adding “in its reasonable discretion” immediately after each “in form and substance satisfactory to the Administrative Agent”; and (ii) Section 4.1.6 of the Credit Agreement is amended by adding “in their reasonable discretion” immediately after “in form and substance satisfactory to the Administrative Agent and its counsel”.

ff.

Sections 2.8.4 and 2.8.5 of the Credit Agreement are amended and restated as follows: “[Reserved]”.

gg.

The second sentence of Section 4.1.5 of the Credit Agreement is amended by adding “(and any successor thereto acceptable to the Administrative Agent in its reasonable discretion)” immediately after “POGM”.

hh.

The introductory sentence of Article VI of the Credit Agreement is amended and restated as follows:

Each of the Borrower and each Designated Borrower hereby represents and warrants to the Administrative Agent, any other Agent, each Lender and the Issuer, except as set forth in the Schedules dated as of May 14, 2010, as follows:

ii.

The last sentence of Section 6.10.1 of the Credit Agreement is amended and restated as follows:

All factual information contained in the most recently delivered Reserve Report was true and correct in all material respects as of the date thereof, and all projections and estimates in such Reserve Report were prepared in good faith based on assumptions believed to be reasonable at the time.

jj.

Section 6.15.2 of the Credit Agreement is amended by adding the following immediately before the final period:

and except for balancing obligations that are settled within 45 days of the production month

kk.

Section 6.17 of the Credit Agreement is amended and restated as follows:

ENTIRE AGREEMENT.  THIS AMENDMENT REPRESENTS THE FINAL AGREEMENT BETWEEN THE PARTIES AND MAY NOT BE CONTRADICTED BY EVIDENCE OF PRIOR, CONTEMPORANEOUS OR SUBSEQUENT ORAL AGREEMENTS BY THE PARTIES.  THERE ARE NO UNWRITTEN ORAL AGREEMENTS BETWEEN THE PARTIES.