<PAGE>   1
                                    FORM 10-Q

                       SECURITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C. 20549

             X QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15 (D) OF
            ---
                       THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended September 30, 1996

                                       OR

            __ TRANSITION REPORT PURSUANT TO SECTION 13 OR 15 (D) OF

                       THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ________________ to __________________

COMMISSION FILE NUMBER 0-18691

                            NORTH COAST ENERGY, INC.
             (Exact name of Registrant as specified in its charter)

        DELAWARE                                               34-1594000
 (State of Incorporation)                                   I.R.S. (Employer
                                                            Identification No.)

           1993 CASE PARKWAY
            TWINSBURG, OHIO                                44087-2343
  (Address of principal executive offices)                 (Zip Code)

Registrants' telephone number, including area code:  (216) 425-2330

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15 (d) of the Securities Exchange Act of 1934
during the preceding 12 months (or for 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 Sections 12, 13, or 15 (d) of the Securities
Exchange Act of 1934 subsequent to the distribution of securities under a plan
confirmed by a court.

                                                 Yes    No 
                                                    ---   ---
APPLICABLE ONLY TO CORPORATE ISSUERS:

Indicate the number of shares outstanding of each of the issuer's classes of
Common Stock, as of the latest practicable date. Indicate the number of shares
outstanding of each of the issuer's classes of Common Stock as the latest
practical date.

                Class                     Outstanding at November 11, 1996
                -----                     --------------------------------
     Common Stock, $.01 par value                   8,047,195


<PAGE>   2

<TABLE>
<CAPTION>

                                                                                       Page No.
                                                                                       --------

PART I  - FINANCIAL INFORMATION

<S>                                                                              <C>  
Consolidated Balance Sheets -
     March 31, 1996 (Audited) and September 30, 1996 (Unaudited)                            2

Unaudited Consolidated Statements of Operations -
     For the Three and Six Months Ended September 30, 1995 and 1996                         4

Unaudited Consolidated Statements of Cash Flows -
     For the Six Months Ended September 30, 1995 and 1996                                   5

Unaudited Notes to Consolidated Financial Statements                                        7

Management's Discussion and Analysis of Financial Condition and Results of Operations      11


PART II - OTHER INFORMATION                                                                18

</TABLE>


<PAGE>   3

                    NORTH COAST ENERGY, INC. AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEETS

                      March 31, 1996 and September 30, 1996

                                   (Unaudited)
<TABLE>
<CAPTION>

                                                     March 31,      September 30,
                                                       1996             1996
                                                       ----             ----
<S>                                                <C>             <C>         
ASSETS
------

CURRENT ASSETS

  Cash and equivalents                             $  1,551,748    $    788,251
  Accounts receivable:
    Trade                                             1,339,601       1,635,635
    Affiliates                                           97,993          84,124
  Inventory                                              85,235         107,241
  Deferred income taxes                                  41,000          41,000
  Refundable income taxes                               115,000         115,000
  Other,net                                              22,097          60,000
                                                   ------------    ------------
         Total current assets                         3,252,674       2,831,251
                                                   ------------    ------------

PROPERTY AND EQUIPMENT, at cost

  Land                                                  122,699          93,437
  Oil and gas properties (successful
    efforts)                                         23,769,853      24,579,678
  Pipelines                                           3,696,277       4,101,187
  Vehicles                                              427,920         487,503
  Furniture and fixtures                                453,718         498,326
  Building and improvements                             145,539         785,217
                                                   ------------    ------------
                                                     28,616,006      30,545,348
  Less-Accumulated depreciation, depletion,
    amortization and impairment                     (11,879,077)    (12,192,941)
                                                   ------------    ------------
                                                     16,736,929      18,352,407

OTHER ASSETS, net                                       253,206         179,664
                                                   ------------    ------------
                                                   $ 20,242,809    $ 21,363,322
                                                   ============    ============
</TABLE>

       The accompanying notes are an integral part of these Balance Sheets

                                       2
<PAGE>   4


                    NORTH COAST ENERGY, INC. AND SUBSIDIARIES

                           CONSOLIDATED BALANCE SHEETS

                      March 31, 1996 and September 30, 1996

                                   (Unaudited)
<TABLE>
<CAPTION>

                                                            March 31,       September 30,
                                                                1996            1996
                                                                ----            ----
<S>                                                        <C>             <C>         
LIABILITIES AND STOCKHOLDERS' EQUITY
------------------------------------

CURRENT LIABILITIES

    Current portion of long-term debt                      $    213,060    $    251,100
    Accounts payable                                          2,481,558       1,768,009
    Accrued expenses                                            280,565         337,310
    Billings in excess of costs on
      uncompleted contracts                                     637,347         574,310
                                                           ------------    ------------

               Total current liabilities                      3,612,530       2,930,729
                                                           ------------    ------------

LONG-TERM DEBT, net of current portion                        8,954,574      11,180,718

DEFERRED INCOME TAXES, net                                      357,100         333,100

COMMITMENTS AND CONTINGENCIES

STOCKHOLDERS' EQUITY

    Series A, 6% Non-Cumulative Convertible Preferred
         stock, par value $.01 per share; 563,270 shares
         authorized; 305,200 and 303,265 issued and
         outstanding (aggregate liquidation value of
         $3,050,200 and $3,032,650, respectively)                 3,052           3,033

    Series B, Cumulative Convertible Preferred stock,
         par value $.01 per share; 625,000 shares
         authorized; 464,665 issued and outstanding
         (aggregate liquidation value of $4,646,650)              4,647           4,647

    Undesignated Serial Preferred stock, par
         value $.01 per share; 811,730 shares
         authorized; none issued and outstanding                   --              --

    Common stock, par value $.01 per share;
         40,000,000 shares authorized; 8,040,148
         and 8,044,597 issued and outstanding                    80,402          80,446

    Additional paid-in capital                               12,082,969      12,082,944
    Retained deficit                                         (4,852,465)     (5,252,295)
                                                           ------------    ------------

         Total stockholders' equity                           7,318,605       6,918,775
                                                           ------------    ------------

                                                           $ 20,242,809    $ 21,363,322
                                                           ============    ============
</TABLE>

       The accompanying notes are an integral part of these Balance Sheets

                                       3
<PAGE>   5

                    NORTH COAST ENERGY, INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF OPERATIONS

                For The Periods Ended September 30, 1995 and 1996

                                   (Unaudited)
<TABLE>
<CAPTION>

                                                 Three Months Ended              Six Months Ended
                                                 ------------------              ----------------
                                                1995           1996            1995           1996
                                                ----           ----            ----           ----
REVENUE:

<S>                                         <C>            <C>            <C>            <C>        
 Oil and gas production                     $   576,508    $   721,199    $ 1,320,880    $ 1,584,133
 Drilling revenues                              134,250        273,504        303,000      1,442,700
 Well operating, transportation and other       408,809        574,978        868,419      1,046,785
 Administrative and agency fees                 238,782        221,483        431,523        424,961
                                            -----------    -----------    -----------    -----------
                                              1,358,349      1,791,164      2,923,822      4,498,579
COSTS AND EXPENSES:
 Oil and gas production expenses                209,795        182,305        411,539        408,115
 Drilling costs                                 209,204        275,055        357,446      1,196,638
 Oil and gas operations                         171,116        392,027        403,435        641,466
 General and administrative expenses            670,536        695,822      1,327,431      1,256,921
 Depreciation, depletion, amortization,
   impairment and other                         468,225        278,942        963,460        579,632
 Abandonment of oil and gas properties             --           (3,692)          --           44,843
                                            -----------    -----------    -----------    -----------
                                              1,728,876      1,820,459      3,463,311      4,127,615
                                            -----------    -----------    -----------    -----------

(LOSS) INCOME FROM OPERATIONS                  (370,527)       (29,295)      (539,489)       370,964
                                            -----------    -----------    -----------    -----------

OTHER INCOME
 Interest                                        16,188         13,174         36,961         27,135
 Other                                            3,004          8,824          7,658         24,824
 Gain (loss) on sale of property
   and equipment                                   --           (8,994)         8,943        (10,774)
                                            -----------    -----------    -----------    -----------
                                                 19,192         13,004         53,562         41,185
                                            -----------    -----------    -----------    -----------

OTHER EXPENSE

 Interest                                       202,765        272,815        372,864        512,104
                                            -----------    -----------    -----------    -----------

LOSS BEFORE INCOME TAXES                       (554,100)      (289,106)      (858,791)       (99,955)

CREDIT FOR INCOME TAXES:
 Current                                           --             --          (61,000)          --
 Deferred                                      (211,000)       (61,000)      (281,000)       (24,000)
                                            -----------    -----------    -----------    -----------
                                               (211,000)       (61,000)      (342,000)       (24,000)
                                            -----------    -----------    -----------    -----------

NET LOSS                                    $  (343,100)   $  (228,106)   $  (516,791)   $   (75,955)
                                            ===========    ===========    ===========    ===========


NET LOSS PER SHARE
  (primary and fully diluted)               $      (.06)   $      (.04)   $      (.10)   $      (.05)
                                            ===========    ===========    ===========    ===========
</TABLE>




    The accompanying notes are an integral part of these Financial Statements

                                       4
<PAGE>   6


                    NORTH COAST ENERGY, INC. AND SUBSIDIARIES

                      CONSOLIDATED STATEMENTS OF CASH FLOWS

              For The Six Months Ended September 30, 1995 and 1996

                                   (Unaudited)
<TABLE>
<CAPTION>

                                                                      1995           1996
                                                                      ----           ----
<S>                                                              <C>            <C>         
CASH FLOWS FROM OPERATING ACTIVITIES:

 Net loss                                                        $  (516,791)   $   (75,955)
 Adjustments to reconcile net loss
  to cash provided by operating activities-
   Depreciation, depletion, amortization, impairment and other       963,460        579,632
   Abandonment of oil and gas properties                                --           44,843
   (Gain) loss on sale of property and equipment                      (8,943)        10,774
   Deferred income taxes                                            (281,000)       (24,000)
   Change in:
    Accounts receivable                                           (1,276,549)      (282,165)
    Other current assets                                              33,665        (59,909)
    Other assets                                                      14,964         22,809
    Accounts payable                                              (1,558,151)      (727,619)
    Current income taxes payable                                        --             --
    Accrued expenses                                                (149,388)        56,745
    Billings in excess of costs on uncompleted contracts           1,334,632        (63,037)
                                                                 -----------    -----------

    Total adjustments                                               (927,310)      (441,927)
                                                                 -----------    -----------

    Net cash used by operating activities                         (1,444,101)      (517,882)
                                                                 -----------    -----------

CASH FLOWS FROM INVESTING ACTIVITIES:

 Purchase of property and equipment                               (1,217,218)    (1,581,674)
 Proceeds on sale of property and equipment                             --          104,262
                                                                 -----------    -----------

    Net cash used for investing activities                        (1,217,218)    (1,477,412)
                                                                 -----------    -----------

CASH FLOWS FROM FINANCING ACTIVITIES:
 Payments of accounts payable used to
  finance property and equipment additions                          (236,422)       (70,962)
 Borrowings under revolving credit facility                        1,000,000      1,660,000
 Borrowings under note payable to stockholder                      1,000,000         41,801
 Repayments of borrowings under revolving  credit facility          (240,003)          --
 Payments on long-term debt                                          (52,824)       (75,167)
 Cash paid for deferred financing cost                               (46,142)          --
 Distributions and dividends                                        (325,171)      (323,875)
                                                                 -----------    -----------
    Net cash provided by financing activities                      1,099,438      1,231,797
                                                                 -----------    -----------

DECREASE IN CASH AND EQUIVALENTS                                  (1,561,881)      (763,497)

</TABLE>



    The accompanying notes are an integral part of these Financial Statements

                                       5
<PAGE>   7

                    NORTH COAST ENERGY, INC. AND SUBSIDIARIES

                CONSOLIDATED STATEMENTS OF CASH FLOWS (CONTINUED)

              For The Six Months Ended September 30, 1995 and 1996

                                   (Unaudited)
<TABLE>
<CAPTION>
                                                        1995          1996
                                                        ----          ----

<S>                                                   <C>          <C>       
CASH AND EQUIVALENTS AT BEGINNING OF PERIOD           $2,366,660   $1,551,748
                                                      ----------   ----------

CASH AND EQUIVALENTS AT END OF PERIOD                 $  804,779   $  788,251
                                                      ==========   ==========

SUPPLEMENTAL DISCLOSURES OF CASH FLOWS INFORMATION:

Cash paid during the period for -
    Interest                                          $  343,116   $  395,823
    Income taxes                                      $   71,135   $     --

SUPPLEMENTAL DISCLOSURES OF NONCASH INVESTING
  AND FINANCING ACTIVITIES:

Long-term debt incurred for the purchase
 of property and equipment                            $   42,860   $  637,549

Accounts payable incurred for the
 purchase of property and equipment                   $  233,552   $   80,032
</TABLE>








    The accompanying notes are an integral part of these Financial Statements

                                       6
 

<PAGE>   8

                    NORTH COAST ENERGY, INC. AND SUBSIDIARIES

                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

                                   (Unaudited)

Note 1.     Summary of Accounting Policies

         A.     General

         The consolidated financial statements included herein, have been
         prepared by North Coast Energy, Inc. without audit. In the opinion of
         management, all adjustments (which include only normal recurring
         adjustments) necessary to present fairly the financial position have
         been made.

         Information and footnote disclosures normally included in financial
         statements prepared in accordance with generally accepted accounting
         principles have been condensed or omitted. It is suggested that these
         financial statements be read in conjunction with the financial
         statements and notes thereto which are incorporated in the Company's
         Annual Report on Form 10-K for the fiscal year ended March 31, 1996.

         The results of the operations for the interim periods may not
         necessarily be indicative of the results to be expected for the full
         year. In addition, the preparation of these financial statements in
         conformity with generally accepted accounting principles requires
         management to make estimates and assumptions that effect the reported
         amounts of assets and liabilities at the date of the consolidated
         financial statements and reported amounts of revenues and expenses
         during the reporting period. Actual results could differ from those
         estimates.

         B.     Principles of Consolidation

         The consolidated financial statements include the accounts of North
         Coast Energy, Inc. and its wholly owned subsidiaries (the Company),
         North Coast Operating Company (NCOC), and NCE Securities, Inc. (NCE
         Securities). In addition, the Company's investments in oil and gas
         drilling partnerships, which are accounted for under the proportional
         consolidation method, are reflected in the accompanying financial
         statements. The Company's ownership of revenues in these drilling
         partnerships are as follows:
<TABLE>
       <S>                                                                                       <C>     
         Capital Drilling Fund 1986-1 Limited Partnership                                              13.2%

         North Coast Energy/Capital 1987-1 Appalachian Drilling Program Limited Partnership            33.7%

         North Coast Energy/Capital 1987-2 Appalachian Drilling Program Limited Partnership            27.0%

         North Coast Energy/Capital 1988-1 Appalachian Drilling Program Limited Partnership            25.5%

         North Coast Energy/Capital 1988-2 Appalachian Drilling Program Limited Partnership            34.8%

         North Coast Energy 1989 Appalachian Drilling Program Limited Partnership                      30.0%

         North Coast Energy 1990-1 Appalachian Drilling Program Limited Partnership                    26.0%

         North Coast Energy 1990-2 Appalachian Drilling Program Limited Partnership                    25.7%

         North Coast Energy 1990-3 Appalachian Drilling Program Limited Partnership                    25.0%

         North Coast Energy 1991-1 Appalachian Drilling Program Limited Partnership                    26.5%

         North Coast Energy 1991-2 Appalachian Drilling Program Limited Partnership                    25.0%

         North Coast Energy 1991-3 Appalachian Drilling Program Limited Partnership                    25.3%

</TABLE>
                                       7
<PAGE>   9

                    NORTH COAST ENERGY, INC. AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                                   (Unaudited)

Note 1.     Summary of Accounting Policies (Continued)

<TABLE>
       <S>                                                                                       <C>     
         North Coast Energy 1992-1 Appalachian Drilling Program Limited Partnership                    25.0%

         North Coast Energy 1992-2 Appalachian Drilling Program Limited Partnership                    25.0%

         North Coast Energy 1992-3 Appalachian Drilling Program Limited Partnership                    39.5%

         North Coast Energy 1993-1 Appalachian Drilling Program Limited Partnership                    30.3%

         North Coast Energy 1993-2 Appalachian Drilling Program Limited Partnership                    31.0%

         North Coast Energy 1993-3 Appalachian Drilling Program Limited Partnership                    30.0%

         North Coast Energy 1994-1 Appalachian Drilling Program Limited Partnership                    30.0%

         North Coast Energy 1994-2 Appalachian Drilling Program Limited Partnership                    25.0%

         North Coast Energy 1994-3 Appalachian Drilling Program Limited Partnership                    25.0%

         North Coast Energy 1995-1 Appalachian Drilling Program Limited Partnership                    20.0%

         North Coast Energy 1995-2 Appalachian Drilling Program Limited Partnership                    20.0%

         North Coast Energy 1996-1 Appalachian Drilling Program Limited Partnership                    20.0%

         All significant intercompany accounts and transactions have been eliminated.
</TABLE>


Note 2.     Long-Term Debt
<TABLE>
<CAPTION>

                                                                       March 31, 1996         September 30, 1996
                                                                       --------------         ------------------

        <S>                                                              <C>                  <C>   
           Long-term debt consists of the following:

             Revolving credit notes payable - bank                           $ 7,560,000           $  9,220,000

             Notes payable to stockholder with interest at prime
             plus 1% and 8%.                                                   1,386,842              1,410,593

             Mortgage note payable to a bank, secured by land and
             a building, requiring monthly payments of approximately
             $1,019 (including interest at 8%) through July 2003.                 67,842                 63,827

             Mortgage note payable to a bank, secured by land and a building,
             requiring monthly payments of approximately $5,248 (including
             interest at 8.58%) through May 2001 over a five year period, 
             at an interest rate to be renegotiated.                                   -                532,561

             Various installment notes payable, in aggregate monthly
             installments (including interest) of $11,012 at March 31,
             1996, and $10,122 at September 30, 1996.                            152,950                204,837
                                                                                --------              ---------
                                                                               9,167,634             11,431,818

             Less current portion                                                213,060                251,100
                                                                              ----------              ---------
                                                                             $ 8,954,574           $ 11,180,718
                                                                              ==========             ==========
</TABLE>


                                       8
<PAGE>   10
                    NORTH COAST ENERGY, INC. AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                                   (Unaudited)

Note 2.     Long-Term Debt (Continued)

         The Company's credit agreement with its lender was amended August 30,
         1996 increasing its reducing revolving line of credit to $20,000,000.
         Available borrowings under this agreement are computed based on a
         borrowing base determined semi-annually by the lender, based upon the
         Company's financial position, and level of oil and gas and pipeline
         based reserves and are further based upon the amount of outstanding
         letters of credit used to support certain bonding requirements
         ($140,000 at September 30, 1996). The borrowing base is reduced monthly
         by an amount determined by the lender at the semi-annual borrowing base
         determination. The amendment also increased the Company's borrowing
         base to $10,000,000, with required monthly reductions of $110,000
         beginning on October 1, 1996. Available borrowings under the revolving
         line of credit were $640,000 at September 30, 1996, and may
         subsequently change based on the semi-annual reserve study and
         borrowing base determination. The revolving line of credit can be
         renewed annually or converted to a term loan at the Company's option
         prior to its expiration in fiscal 1998.

         Amounts outstanding under the reducing revolving line of credit, which
         were $9,220,000 at September 30, 1996, bear interest at the lending
         bank's prime rate plus 1-1/2%. The agreement requires the Company to
         pay a commitment fee of 1/2% on the unused amount of the available
         borrowings and closing costs of 1% on any increase in borrowing
         availability. The agreement contains certain restrictive covenants,
         including minimum working capital, minimum shareholders' equity and a
         minimum debt coverage ratio, all as defined. The Company was in
         compliance with all covenants as of September 30, 1996.

         The revolving credit facility and the notes are collateralized by
         substantially all of the Company's assets including receivables,
         inventory, equipment and a first mortgage on certain of the Company's
         interest in oil and gas wells and reserves.

         The Company has two notes payable to a stockholder. One note is payable
         out of future operating revenues, as defined. The note is subordinate
         to the borrowings under the revolving credit notes payable - bank.
         During fiscal 1996, the Company entered into an additional note payable
         with the same stockholder for $1,000,000. This note can be repaid in
         either shares of common stock or the proceeds of a public offering, as
         defined. This note is also subordinated to the borrowings under the
         revolving credit notes payable - bank. In connection with entering into
         the Loan Agreement, the Company granted the stockholder certain
         warrants to purchase 200,000 shares of common stock at $1.20 per share
         and 300,000 shares of common stock at $1.00 per share, as defined. The
         warrants may be redeemed by the Company for $.10 per share at its
         option upon 30 days written notice.

         On May 13, 1996, the company purchased a building for its headquarters
         and entered into a mortgage note for $540,000 over a 15 year term with
         an interest rate of 8.58% to be renegotiated every five years.

                                       9
<PAGE>   11
                    NORTH COAST ENERGY, INC. AND SUBSIDIARIES

             NOTES TO CONSOLIDATED FINANCIAL STATEMENTS (CONTINUED)

                                   (Unaudited)

Note 3.     Billings in Excess of Costs on Uncompleted Contracts

         Billings in excess of costs on uncompleted contracts consist of:
<TABLE>
<CAPTION>

                                                           March 31,                     September 30,
                                                             1996                            1996
                                                          -----------                    -------------

<S>                                                       <C>                             <C>        
               Billings on uncompleted contracts          $ 1,518,486                     $   700,826
               Costs incurred on uncompleted contracts        881,139                         126,516
                                                          -----------                     -----------
                                                          $   637,347                     $   574,310
                                                          ===========                     ===========
</TABLE>


Note 4.     Commitment and Contingencies

         The Company and a commercial bank have issued standby letters of credit
         which provide a guaranteed total amount of $140,000 in lieu of coverage
         provided by insurance or road bond deposits against damage.

         At September 30, 1996, the Company has committed to fund certain costs
         of the North Coast Energy Appalachian Drilling Programs estimated to
         be approximately $580,000 for tangible well equipment and pipeline
         construction. This commitment is expected to be realized by March 1997.

                                       10
<PAGE>   12
                      MANAGEMENT'S DISCUSSION AND ANALYSIS

                OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS

GENERAL

         North Coast Energy, Inc., (the "Company") a Delaware corporation, is an
independent natural gas and oil company engaged in exploration, development and
production activities primarily in the Appalachian Basin region of Ohio and
Pennsylvania. The Company's strategy focuses primarily on the acquisition of
proved undeveloped natural gas and oil properties and on the turnkey drilling
and development of such properties by the Company in conjunction with drilling
partnerships which the Company sponsors and manages (the "Drilling Programs").
The Drilling Programs are funded through the sale of partnership interests to
non-industry investors and by contributions from the Company.

         Several factors may affect the amount and timing of the Company's
revenues with respect to the activities of the Drilling Programs. The amount of
funds raised for each Drilling Program determines the number of wells for which
the Company receives drilling revenues and the date at which the wells reach a
certain point in the completion process determines the timing of revenue
recognition. The Company continually monitors the cost incurred in drilling,
completion and production operations and reviews its turnkey drilling contract
prices for each Drilling Program in order to reduce the risk of unprofitable
drilling operations. The turnkey drilling contract price between the Drilling
Programs and the Company may vary from Drilling Program to Drilling Program
depending on competition, type of well drilled and other cost factors and the
returns sought by investors in the Drilling Programs. A change in the turnkey
price and the Company's percentage interest in future Drilling Programs may
affect the Company's capital availability, as well as revenues and profits.

         The Company typically forms the Drilling Programs between August and
December of each year and conducts its drilling operations between September and
March. It generally requires nine months between the drilling of a well and the
generation of production revenue from that well. Drilling revenues are
predominantly recognized during the second half of the Company's fiscal year.

         The following table is a review of the results of operations of the
Company for the six months ended September 30, 1995 and 1996. All items in the
table are calculated as a percentage of total revenues.
<TABLE>
<CAPTION>

                                                                Three Months            Six Months
                                                                   Ended                  Ended
                                                               September 30,          September 30,
                                                               -------------          -------------
                                                              1995     1996          1995      1996
                                                              --------------         --------------
<S>                                                             <C>        <C>        <C>        <C>
Revenues:
---------
   Oil and gas production                                       42%        40%        44%        35%
   Drilling revenues                                            10         15         10         32
   Well operating, transportation and other                     30         32         29         23
   Administrative and agency fees                               17         12         15          9
   Other                                                         1          1          2          1
                                                              ----       ----       ----       ----

        Total Revenues                                         100%       100%       100%       100%
                                                               ---        ---        ---        ---
</TABLE>

                                       11
<PAGE>   13

<TABLE>
<S>                                                             <C>        <C>        <C>          <C>
Expenses:
   Oil and gas production expenses                              15%        10%        14%         9%
   Drilling costs                                               15         15         12         26
   Oil and gas operations                                       12         22         13         14
   General and administrative expenses                          49         39         45         28
   Depreciation, depletion, amortization
     impairment and other                                       34         15         32         13
   Abandonment of oil and gas properties                         0          0          0          1
   Provision for taxes on income                               (15)        (3)       (11)         0
   Other                                                        15         15         12         11
                                                             -----       ----      -----      -----

         Total Expenses                                        125%       113%       117%      102%
                                                               ---        ---        ---       ---

Net Loss                                                       (25%)      (13%)      (17%)      (2%)
                                                             =====       ====      =====     =====
</TABLE>
                                                 

         The following discussion and analysis reviews the results of operations
and the financial condition for the Company for the three and six months ended
September 30, 1996 and 1995. The review should be read in conjunction with the
financial information presented elsewhere herein.

COMPARISON OF SIX MONTHS ENDED SEPTEMBER 30, 1996 TO SIX MONTHS ENDED SEPTEMBER
30, 1995.

REVENUES

         Oil and gas production revenues increased $263,253 (20%) to $1,584,133
for the six months ended September 30, 1996 compared to $1,320,880 for the prior
corresponding period. Revenues were enhanced by increases in both oil and gas
production from wells in the Appalachian area. In addition, the average gas 
price the Company received for oil and natural gas increased approximately 16%.
The average gas price the Company received increased to $2.41 per Mcf for the
six months ended September 30, 1996 compared to $2.07 per Mcf for the six
months ended September 30, 1995. The average oil price the Company received
increased to $19.85 per Barrel for the six months ended September 30, 1996
compared to $16.99 per Barrel for the six months ended September 30, 1995.

         Drilling Revenues for the period increased by $1,139,700 (376%) for 
the six months ended September 30, 1996 compared to the six months ended
September 30, 1995 due to the increase in the number of wells recognized in
revenue for the period. The Company recognized revenues for the six months ended
September 30, 1996 on fourteen wells as compared to four wells for the six
months ended September 30, 1995. The increase in wells recognized in drilling
revenues was due to a larger number of wells in progress at the Company's fiscal
year end of March 31, 1996 compared to March 31, 1995.

         Revenues generated from well operating, transportation and other
increased $178,366 (21%) for the six months ended September 30, 1996 compared to
the six months ended September 30, 1995. This increase was due to an increase in
unaffiliated third party gas sales. The unaffiliated third party gas sales
fluctuate from year to year based upon the availability of these types of
transactions and Company resources available. The increase in revenues in this
category was somewhat offset by a decrease in compression fees due to expenses
incurred with the placement of several new compression facilities into
operation.

EXPENSES

         Drilling  costs for the six months  ended  September  30, 1996 compared
to the six months ended September 30, 1995 increased $839,192 (235%) due to the
increased number of wells completed between comparable periods.

                                       12
<PAGE>   14
         Oil and gas operations expense increased $238,031 (59%) for the six
months ended September 30, 1996 as compared to the six months ended September
30, 1995. This increase was due to the increase in unaffiliated third party gas
purchases related to unaffiliated third party gas sales as discussed above.

         General and administrative expenses decreased $70,510 (5%) for the six
months ended September 30, 1996 compared with the six months ended September 30,
1995. This decrease resulted from a change in the Company's allocation of
general and administrative costs to production and operation expenses. Without
this change in the allocation of costs, the Company's general and administrative
expenses would have remained relatively constant even with $89,000 in legal fees
pertaining to litigation with Lomak Petroleum, Inc. and other related issues.

         Depreciation, depletion, amortization, impairment and other decreased
$383,828 (40%) for the six months ended September 30, 1996 compared to the six
months ended September 30, 1995. This decrease was primarily due to the
implementation of the Statement of Financial Accounting Standards (SFAS) No.
121, "Accounting for the Impairment of Long-Lived Assets and for Long-Lived
Assets to Be Disposed Of" during fiscal 1996 which decreased the basis of the
properties being depleted for future periods.

         Interest expense increased to $512,104 for the six months ended
September 30, 1996 from $372,864 for the six months ended September 30, 1995.
This increase was primarily due to the Company's additional borrowings on its
reducing revolving credit facility. At September 30, 1996, $9,220,000 was
outstanding under the Company's Credit Facility, as compared to $6,810,000 at
September 30, 1995.

         Operating income for the six months ended September 30, 1996 increased
to $370,964 compared to an operating loss of $539,489 for the six months ended
September 30, 1995 primarily due to the decrease in depreciation, depletion,
amortization, impairment and other and increases in oil and gas production and
net drilling income. The Company's net loss was $75,955 for the six months ended
September 30, 1996 compared to a net loss of $516,791 for the six months ended
September 30, 1995.

COMPARISON OF THREE MONTHS ENDED SEPTEMBER 30, 1996 TO THREE MONTHS ENDED
SEPTEMBER 30, 1995.

REVENUES

         Oil and gas production revenues for the three months ended September
30, 1996 increased $144,691 (25%) to $721,199 compared to $576,508 for the prior
corresponding period. The primary reason for the increase in oil and gas
production revenues was a 19% increase between comparable periods in the average
natural gas price the Company received coupled with an increase of 7% in natural
gas production. The average price the Company received for natural gas increased
to $2.43 per Mcf for the three months ended September 30, 1996 from $2.04 per
Mcf for the three months ended September 30, 1995.

         The Company recognized revenue on the drilling of three wells for the
three months ended September 30, 1996 compared to one well for the three months
ended September 30, 1995 resulting in an increase in drilling revenue of
$139,254 (104%).

         Revenues generated from well operating, transportation and other
increased $166,169 (41%) for the three months ended September 30, 1996 as
compared to the three months ended September 30, 1995. This increase was due to
an increase in unaffiliated third party gas sales. The unaffiliated third party
gas sales fluctuate from year to year based upon the availability of these types
of transactions and resources available. The increase in revenues in this
category was somewhat offset by a decrease in compression fees due to expenses
incurred with the placement of several new compression facilities into
operation.

         Revenue from administrative and agency fees decreased by 7% for the
three months ended September 30, 1996 compared to the three months ended
September 30, 1995. This decrease was due to the reduction of administrative
fees charged to certain of the Company's Drilling Programs. This reduction
followed the Company's policy of reviewing administrative fees and reducing
these fees when necessary.

                                       13
<PAGE>   15

EXPENSES

         Oil and gas operations expense increased $220,911 (129%) for the three
months ended September 30, 1996 as compared to the three months ended September
30, 1995. This increase was due to the increase in unaffiliated third party gas
purchases related to unaffiliated third party gas sales as discussed above.

         General and administrative expenses increased $25,286 (4%) for the
three months ended September 30, 1996 compared to the three months ended
September 30, 1995. This increase was due to $89,000 in legal fees pertaining to
litigation with Lomak Petroleum, Inc. and other related issues.

         Depreciation, depletion, amortization, impairment and other decreased
$189,283 (40%) for the three months ended September 30, 1996 compared to the
three months ended September 30, 1995. This decrease was primarily due to the
implementation of the Statement of Financial Accounting Standards (SFAS) No.
121, "Accounting for the Impairment of Long-Lived Assets and for Long-Lived
Assets to Be Disposed Of" during fiscal 1996 which decreased the basis of the
properties being depleted for future periods.

         Interest expense increased to $272,815 for the three months ended
September 30, 1996 from $202,765 for the three months ended September 30, 1995.
This increase was associated with the Company's additional borrowings on its
reducing revolving credit facility.

         For the three months ended September 30, 1996 loss from operations
decreased $341,232 compared to the three months ended September 30, 1995 due
primarily to the increase in oil and gas production revenues coupled with lower
depreciation, depletion, amortization and other.

INFLATION AND CHANGES IN PRICES

         While the costs of operations have been and will continue to be
effected by inflation, oil and gas prices have fluctuated during recent years
and generally have not followed the same pattern as inflation. With today's
global economy, especially in the area of oil and natural gas, Management
believes that other forces of the economy and world events, such as OPEC, the
weather, economic factors, and the effects of the supply of natural gas in the
United States and regionally have a more immediate effect on current pricing
than inflation. The Company received an average price of $19.85 and $16.99 per
barrel in the six months ended September 30, 1996 and 1995, respectively, and
$2.41 and $2.07 per Mcf for natural gas in the six months ended September 30,
1996 and 1995, respectively. The general market for natural gas in the
Appalachian Basin has rebounded somewhat reflecting the colder Appalachian area
weather which caused a draw-down in storage supplies of natural gas during the
1995/1996 winter. The reasons for the previously weak natural gas prices and
recent increases in the gas prices can be attributed to supply and demand
fluctuations caused by the weather sensitive nature of the industry. Although
there has been a decline in gas prices during the summer months compared to the
winter of 1995/1996, the demand for gas by storage facilities has continued to
keep gas prices above last year. Other variables potentially effecting gas
prices are increased competition from Canadian gas, effects of gas storage and
possibly Federal Energy Regulatory Commission ("FERC") Order 636. The FERC Order
may have contributed to the lower spot market prices by mandating an unbundling
of pipeline service and allowing open access to a variety of geographical
markets. Management cannot predict what long-term effects FERC Order 636 will
have on either spot market prices or longer term gas contracts.

         Currently, the Company sells natural gas under both fixed price
contracts and on the spot market. The spot market price the Company receives for
gas production is related to several variables, including the weather and the
effects of gas storage. The Company anticipates that spot market prices will
continue to fluctuate in response to various factors, primarily weather and
market conditions.

         In an effort to position itself to take advantage of future increases
in demand for natural gas, the Company continues to construct new gas gathering
systems in the Appalachian Basin and to contract with other pipeline systems in
the region to transport natural gas production from Company wells.
                                       14

<PAGE>   16

LIQUIDITY AND CAPITAL RESOURCES

         The Company's working capital was approximately negative $99,000 at
September 30, 1996 compared to approximately negative $360,000 at March 31,
1996. The increase of $261,000 in working capital from March 31, 1996 reflects
additional borrowings during the six months ended September 30, 1996. An
amendment to the Credit Facility increased the Company's borrowing base from
$9,500,000 at March 31, 1996 to $10,000,000 at August 30, 1996. As of September
30, 1996, the Company had $9,220,000 outstanding under its Credit Facility.
North Coast's current ratio was .97 to 1.0 at September 30, 1996 and .90 to 1.0
at March 31, 1996.

         The following table summarizes the Company's financial position at
March 31, 1996 and September 30, 1996:
<TABLE>
<CAPTION>

(Amounts in Thousands)         March 31, 1996      September 30, 1996
                               --------------      ------------------
                                Amount       %      Amount          %
                                ------       -      ------          -
<S>                            <C>          <C>   <C>             <C> 
Working capital                $   (360)    (2%)  $    (99)       (1%)
Property and equipment (net)     16,737    100%     18,352       100%
Other                               253      2%        180         1%
                               --------  -----    --------       ---
   Total                       $ 16,630    100%   $ 18,433       100%
                               ========  =====    ========       ===

Long-term debt                 $  8,954     54%   $ 11,181        61%
Deferred income taxes               357      2%        333         2%
Stockholders' equity              7,319     44%      6,919        37%
                               --------  -----    --------       ---
   Total                       $ 16,630    100%   $ 18,433       100%
                               ========  =====    ========       ===
</TABLE>


CAPITAL RESOURCES AND REQUIREMENTS

         The oil and gas exploration and development activities of North Coast
historically have been financed through the Drilling Programs, through
internally generated funds, and from bank financing.

         The following table  summarizes the Company's  Statements of Cash 
Flows for the six months ended September 30, 1995 and 1996:
<TABLE>
<CAPTION>


                                                                  Six Months Ended September 30,
                                                                  ------------------------------
(Amounts in Thousands)                                            1995                      1996
                                                                  ----                      ----
                                                            Amount          %          Amount          %
                                                            ------          -          ------          -

<S>                                                       <C>              <C>        <C>             <C>  
Net cash used by operating activities                     $ (1,444)        (51%)      $  (518)        (21%)
Net cash used for investing activities                      (1,217)        (43%)       (1,477)        (58%)
Net cash provided by financing activities                    1,099          39%         1,232          49%
                                                          --------         ---        --------         --
Decrease in cash and equivalents                          $ (1,562)        (55%)      $  (763)        (30%)
                                                          ========         ===        ========         ==
</TABLE>

      Note: All items in the previous table are calculated as a percentage of
      total cash sources. Total cash sources include the following items if
      positive: cash flow from operations before working capital changes,
      changes in working capital, net cash provided by investing activities and
      net cash provided by financing activities, plus any decrease in cash and
      cash equivalents.

         As the above table indicates, the Company's cash flow used by operating
activities decreased approximately $926,000 for the six months ended September
30, 1996 compared to the period ended September 30, 1995. This decrease reflects
the increased number of wells recognized in drilling revenues and the increase
cash flow from operations.

                                       15
<PAGE>   17

         Net cash used for investing activities increased to approximately
$1,477,000 (58% of cash sources) for the six months ended September 30, 1996
from approximately $1,217,000 (43% of cash sources) for the six months ended
September 30, 1995. This increase is primarily due to the Company's acquisition
of a new building to house its corporate headquarters coupled with the timing of
the Company's cash expenditures related to its obligation to fund the tangible
equipment for the Drilling Programs.

         Net cash provided by financing activities increased approximately
$133,000 for the six months ended September 30, 1996 compared to the prior
period. This increase reflects the increase in borrowings on the Company's
credit facilities for the six months ended September 30, 1996 compared to
September 30, 1995.

         On September 20, 1993 the Company entered into an agreement with an
affiliate of its lender to provide a reducing revolving line of credit of up to
$10,000,000, effective August 30, 1996 this amount was increased to
$20,000,000(the "Credit Facility"). The Credit Facility (as amended for
borrowing base adjustments) provided the Company with available borrowings of
$10,000,000 at September 30, 1996 based upon the Company's financial position
and level of oil and natural gas and pipeline-based reserves, with available
borrowings reducing $110,000 at the first of each month. Available borrowings
are also subject to a reduction based upon the amount of outstanding letters of
credit used to support certain bonding requirements ($140,000 as of September
30, 1996). The Credit Facility provides that availability is subject to
adjustment based upon the Company's semi-annual reserve study and is subject to
certain covenants (see Note 4 to the Company's March 31, 1996 financial
statements). As of September 30, 1996, the Company had $9,220,000 outstanding
under the Credit Facility. At September 30, 1996 the Company was in compliance
with its loan covenants. Amounts borrowed under the Credit Facility bear
interest at the lending bank's prime rate plus 1 1/2%. Also, at September 30,
1996, the Company had approximately $63,827 outstanding under a mortgage note
payable. The mortgage note bears interest at the rate of 8% and requires the
Company to make monthly payments of approximately $1,019 through July 2003. The
Company purchased a building for its headquarters and entered into a mortgage
note on May 13, 1996 for $540,000 over 15 year term with an interest rate of
8.58% to be renegotiated every five years. The amount outstanding under the
mortgage note at September 30, 1996 was $532,561.

         The amounts borrowed under its reducing revolving line of credit are
secured by the Company's receivable, inventory, equipment and a first mortgage
on certain of the Company's interests in oil and gas wells and reserves. The
mortgage notes are secured by certain land and buildings.

         In addition to bank financing, in 1994 the Company secured $335,000 in
financing from NAGIT, a principal stockholder of the Company, relating to the
purchase of certain producing wells, gas gathering lines and drilling locations.
The amounts outstanding under the terms of the Company's financing arrangements
with NAGIT are subordinated to the prior payment and amounts outstanding under
the Company's Credit Facility, and bear an interest rate at the prime rate
designated by the Chemical Bank, N.A., plus 1% (9.25% at September 30, 1996).
This agreement grants NAGIT an overriding royalty interest in the acquired
properties. Repayment of the loan is in cash, based upon a percentage of the net
monthly revenues from the acquired properties.

         Also, effective June 13, 1995, the Company entered into a Loan
Agreement with NAGIT with respect to a loan of $1,000,000. The unsecured loan
may be repaid in cash plus accrued interest (with approval of the Company's
senior lender) with the proceeds of a sale of equity or may be converted into
shares of Common Stock at the rate of $1.00 per share. The loan is subordinate
to the Company's Credit Facility with its senior lender and bears interest at
the rate of 8% per annum. As of September 30, 1996, the balance of the loan and
accrued interest was $1,105,812. In connection with entering into the Loan
Agreement, the Company issued a warrant to purchase 200,000 shares of Common
Stock at $1.20 per share and a warrant to purchase 300,000 shares of Common
Stock at $1.00 per share. The warrants may be redeemed by the Company for $.10
per share at its option upon 30 days written notice. All of the Company's
indebtedness to NAGIT, as well as the related Warrants, were acquired by Lomak
in connection with the stock purchase described below.

         As the financial results for the six months ended September 30, 1996
indicate North Coast Energy, Inc. made significant strides to regain
profitability. Recent developments, however, have caused concern for the
Company's ability to meet its current obligations. The Company has focused on 
its core business of forming Drilling 



                                       16
<PAGE>   18

Programs which enables the Company to generate drilling revenues, well operating
fees, administrative fees and transportation fees. Management anticipated a
profitable year based upon improved drilling margins, higher product prices, the
results of the first six months of fiscal 1997 and a generally positive
reception from its broker/dealer network for Drilling Program sales. On or about
September 4, 1996 Lomak Petroleum, Inc.(Lomak), a publicly traded oil and gas
company, purchased approximately 47% of the outstanding common stock of the
Company from two of the Company's largest shareholders, NAGIT, USA (NAGIT) and
Bruce E. Brocker.

         At the Company's annual meeting of stockholders, Lomak presented
proxies representing the shares acquired from these shareholders and indicated
its intention to nominate and elect two directors in the class whose terms were
scheduled to expire at that meeting. Due to concerns about the validity of such
proxies, the annual meeting was adjourned to a later date. On September 11,
1996, the meeting was reconvened. At the reconvened meeting, the Company
recognized the validity of the proxy executed by NAGIT (PLC), but reserved its
rights with respect to the proxy executed by Mr. Brocker. As described under the
caption "Legal Proceedings," litigation among the Company, Lomak and Mr. Brocker
then ensued. Also as described under "Legal Proceedings," the parties have
recently reached a settlement with respect to that litigation.

         Revenues derived from the Company's Drilling Programs provide an
important source of the Company's cash flow. Due to uncertainties among
potential Drilling Program investors arising out of Lomak's acquisition of a
substantial ownership interest in the Company and the other matters described
above, the Company's ability to market its Drilling Programs has been adversely
affected. Consequently, demands on the Company's capital resources have
increased due to reduced cash flow associated with lower levels of investor
interest in its Drilling Programs and increased costs associated with litigation
and evaluating the Company's strategic alternatives. This has necessitated
actions by the Company to alter its growth oriented business plan in order to
conserve cash. On October 21, 1996, the Company initiated layoffs of 21% of its
staff coupled with a temporary reduction or deferment in wages to many of its
remaining employees. Additional cost cutting measures may become necessary in
the future if investor interest in the Company's Drilling Programs does not
increase.

         With the reduction of the Drilling Program activity and the need to
conserve cash, the Company's ability to monetize equipment it owns on productive
wells and increase profitably through the Drilling Programs will be adversely
affected. It will be necessary for the Company to secure additional sources of
capital or financing for its future projects and to fund its current
obligations. In the event that available borrowings under the Credit Facility
are not sufficient or additional financing cannot be obtained, the Company would
be required to continue its current efforts to conserve cash resources. In order
to accomplish this objective, the Company believes that it would be necessary to
take various actions, including reducing the amount of capital raised in future
Drilling Programs, the introduction of additional cost cutting measures and the
possible sale of certain assets. Management of the Company believes that
measures of this type would have a material adverse effect on the Company.

         The Company currently has 303,265 shares of Series A, 6% Non-Cumulative
Convertible Preferred Stock ("Stock A Stock") and 625,000 shares of Series B,
Cumulative Convertible Preferred Stock ("Series B Stock") outstanding. Holders
of Series A Stock are entitled to receive Semi-annual cash dividends at an
annual rate of $.60 per share and holders of Series B Stock are entitled to
receive quarterly cash dividends at an annual rate of $1.00 per share. The next
Semi-annual dividend payment on the Series A Stock is scheduled to be made on
December 1, 1996, and the next quarterly dividend payment on the Series B Stock
is scheduled to be made on December 31, 1996. As a result of the increased
demands on the Company's cash flow resulting from the lower level of investor
interest in its Drilling Programs, the Company anticipates that it may be unable
to make these dividend payments when due.


                                       17
<PAGE>   19



                    NORTH COAST ENERGY, INC. AND SUBSIDIARIES
                                     PART II

                                OTHER INFORMATION

Item 1.  LEGAL PROCEEDINGS

         On June 18, 1996, the Company initiated an action in the Court of
Common Pleas of Mahoning County, Ohio styled NORTH COAST ENERGY, INC. VS. LOMAK
PETROLEUM, INC., ET AL., Case No. 96 CV 01555, against both Lomak and its
wholly-owned subsidiary, Border Resources, Inc. The complaint seeks damages in
excess of $517,000 for, among other things, the value of natural gas sold by the
Company to the defendants between December 1995 and March 1996, but for which
payment was never made by the defendants. Border Resources counterclaimed for
damages in excess of $950,000 based upon the allegation that the Company had
breached an existing contract by stopping further deliveries of gas which
allegedly necessitated the purchase of replacement gas by Border at a higher
price. Lomak's motion to dismiss was denied by the Court on September 3, 1996.

         On September 4, 1996 representatives of Lomak attended the Company's
Annual Meeting of Stockholders at the Company's headquarters in Twinsburg, Ohio,
and presented proxies which purported to represent approximately 46.49% of the
shares of the Company's common stock which had been purchased by Lomak from
NAGIT (USA), North American Gas Investment Trust, PLC, and Bruce E. Brocker,
formerly the Company's Chairman of the Board. The meeting was adjourned until
the following Wednesday, September 11, 1996, to allow the inspectors of election
and legal counsel to verify the validity of the proxies and also to review the
Separation Agreement of January 6, 1995 between the Company and Brocker to
determine if the purported sale represented a breach of that agreement.

         At the reconvened meeting of September 11, the Company recognized the
NAGIT (PLC) proxy, but reserved its rights with respect to the proxy executed by
Mr. Brocker based upon a review of Mr. Brocker's Agreement pursuant tot which he
sold his stock to Lomak. When the Chairman, Garry Regan, attempted to adjourn
the meeting once again based upon this issue, representatives of Lomak acted to
continue the meeting and elect their representatives as Directors, being C. Rand
Michaels and Steven L. Gorse, in opposition to the Company's nominees. Lomak
then filed an action in the Court of Chancery for the State of Delaware in a
case styled Lomak Petroleum, Inc., C. Rand Michaels and Steven L. Grose vs.
North Coast Energy, Inc., Charles M. Lombardy, Jr., and Charles K. Ebinger,
Civil Action No. 15211. The Company raised as an affirmative defense the
invalidity of the alleged proxy from Bruce E. Brocker and the fact that the
Shareholders' Meeting of the 11th had been adjourned without any valid action
having been taken.

         The Company also amended its complaint in the Mahoning County, Ohio
action relating to the natural gas sales dispute to add a claim for tortious
interference against Lomak and a breach of contract claim against Mr. Brocker
with respect to his separation agreement with the Company.

         Following discussions and negotiations between representatives of the
Company and Lomak, effective November 12, 1996, the Company entered in a
Settlement Agreement with Lomak in which all parties stipulated to the dismissal
of the Delaware litigation and to the litigation relating to Lomak's acquisition
of Mr. Brocker's shares in Ohio. The Settlement Agreement provides that the
Company will acknowledge the election of Messrs. Michaels and Grose as Directors
of the Company and, in addition, the Company and its Board of Directors have
agreed to increase the size of the Board from six to nine directors. The Board
will fill these vacancies by electing Charles M. Lombardy, Jr., Dr. Charles
Ebinger, the Board's original nominees for the September 1996 Annual Meeting,
and John H. Pinkerton of Lomak to fill these vacancies.

                                       18
<PAGE>   20


         The Company also agreed to withdraw its motion for leave to amend its
complaint in the Mahoning County, Ohio action and entered into a separate
settlement agreement and mutual release with Bruce E. Brocker whereby both
parties acknowledged the continuing validity of the Separation Agreement of
January 6, 1995. Accordingly, the only remaining legal proceeding is to the
existing gas contract dispute with Lomak and its subsidiary, Border Resources.

Item 2.  CHANGES IN SECURITIES

         Not applicable

Item 3.  DEFAULTS UPON SENIOR SECURITIES

         Not applicable

Item 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

         Not applicable

Item 5.  OTHER INFORMATION

         Not applicable

Item 6.  EXHIBITS AND REPORTS ON FORM 8-K

         a).  Exhibits

          10.32 Fifth Amendment to Credit Agreement by and between Bank One,
                Texas, N.A. and the Company dated August 30, 1996.

          10.33 Open End Mortgage and Promissory Note by and between Bank One,
                Akron, N.A. and the Company dated April 30, 1996.

          11.1  Computation of Earnings per Common Share.

          27.1* Financial Data Schedule

         b). No reports on Form 8-K have been filed during the quarter for which
this report was filed.

--------
* Exhibit 27.1 furnished for Securities & Exchange Commission only


                                       19
<PAGE>   21


                                   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 thereunto duly authorized.

                              NORTH COAST ENERGY, INC.

November 13, 1996             /s/ Charles M. Lombardy, Jr.
                              --------------------------------------------
                              Charles M. Lombardy, Jr.

                              Chief Executive Officer and Director

November 13, 1996             /s/ Tim Wagers
                              --------------------------------------------
                              Tim Wagers

                              Principal Accounting and Financial Officer

                                       20