Exhibit 2.1
PLAN AND AGREEMENT AND ARTICLES OF MERGER
TO FORM HOLDING COMPANY
among
SWIFT ENERGY COMPANY
NEW SWIFT ENERGY COMPANY
and
SWIFT ENERGY OPERATING, LLC
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Pursuant to the provisions of Article 5.03.H and
Article 5.04 of the Texas
Business Corporation Act ("TBCA"), and Article 10.03 of the Texas Limited
Liability Company Act ("TLLCA"), the undersigned corporations and limited
liability company certify the following Plan and Agreement and Articles of
Merger to Form Holding Company, adopted for
the purpose of effecting a merger in
accordance with the provisions of Part Five of the TBCA and Part Ten of
the
TLLCA.
-------------------------------
THIS PLAN AND
AGREEMENT AND ARTICLES OF MERGER TO FORM
HOLDING COMPANY
(this "Plan"), dated as of December 16, 2005 and
effective at the Effective
Time, as defined in Section 1.2 of this Plan, is by and among Swift Energy
Company, a Texas corporation ("Old Swift"),
New Swift Energy
Company, a Texas
corporation and a wholly owned subsidiary
of Old Swift ("New Swift"), and Swift
Energy Operating, LLC, a Texas limited liability company and a wholly owned
subsidiary of New Swift ("Merger Sub").
WHEREAS,
Old Swift has an
authorized
capitalization
consisting
of: (i)
85,000,000 shares of common stock,
par value $.01 per
share ("Old Swift Common
Stock"), and (ii) 5,000,000 shares of
preferred stock, par value $.01 per share
("Old Swift Preferred Stock"), and pursuant to the provisions of
Article 5.03.H
of the TBCA, shareholder approval of this Plan
by the shareholders of Old Swift
is not required; and
WHEREAS,
New Swift has an
authorized
capitalization
consisting
of: (i)
85,000,000 shares of common stock,
par value $.01 per
share ("New Swift Common
Stock"), of which 1,000 shares are issued
and outstanding and
are owned by Old
Swift and no shares are held in treasury;
and (ii) 5,000,000 shares of preferred
stock, par value $.01 per share ("New Swift
Preferred Stock"),
none of which is
issued or outstanding; and
WHEREAS, the
designations,
preferences, limitations and relative rights of
respectively the New Swift Common Stock and the
New Swift Preferred
Stock are
the same as those of respectively the Old Swift Common Stock and the
Old Swift
Preferred Stock; and
WHEREAS,
Merger Sub has an
authorized
capitalization
consisting
of (i)
85,000,000 units of common membership
interest, having a
capital amount of $.01
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per unit (the "Merger Sub Common Units"),
of which 1,000 Merger Sub Common Units
are issued and outstanding and are owned by
New Swift, and (ii)
5,000,000 units
of preferred membership interest,
having a capital
amount of $.01 per unit (the
"Merger Sub Preferred Units") none of which
is issued and outstanding; and
WHEREAS,
Old Swift has
heretofore
executed and
delivered to the
Trustee
named therein (i) the Indenture and the
First Supplemental Indenture, each dated
April 16, 2002 (collectively, the "2002
Indenture"), providing
for the issuance
of Old Swift's 9-3/8% Senior Subordinated
Notes due 2012 and (ii) the Indenture
and the First Supplemental Indenture, each
dated June 23, 2004, (collectively,
the "2004 Indenture") providing
for the issuance of Old Swift's 7-5/8%
Senior
Notes due 2011 (the 2002 Indenture
and the 2004 Indenture
collectively
herein,
the "Indentures"), which Indentures are to be amended as part of the
Merger,
as defined below; and
WHEREAS, the
Board of Directors of Old Swift has determined it to be in the
best interests of Old Swift to effect the formation of a holding company
structure whereby Merger Sub, as the
survivor of a merger between Old Swift and
Merger Sub will, immediately after the
merger, be the wholly owned subsidiary of
New Swift and the shareholders of Old Swift will
become the shareholders of New
Swift; and
WHEREAS,
it is intended
that the holding
company structure be effected
without a vote of Old Swift's shareholders pursuant to and in accordance
with
Article 5.03.H of the TBCA through a merger of Old Swift into Merger Sub
pursuant to Article 5.01 and Article 5.03.H
of the TBCA and Article 10.01 of the
TLLCA; and
WHEREAS, the
respective Boards of Directors of Old Swift and New Swift, the
Board of Managers of Merger Sub, Old Swift
acting as the sole shareholder of New
Swift, and New Swift acting as the sole
member of Merger Sub, have approved the
merger of Old Swift into Merger Sub (the
"Merger"), the
conversion of shares of
Old Swift Common Stock into shares of New Swift
Common Stock provided for in
this Plan, the change of name of New Swift to
"Swift Energy
Company" at the
Effective Time, the other terms of this
Plan, and the execution of this Plan by
each such entity; and
WHEREAS,
New Swift and Merger
Sub have been
recently formed solely for
purposes of effecting the formation of a
holding company
structure through
the
Merger and New Swift has at all times
since its incorporation been a direct
wholly owned subsidiary of Old Swift;
and
WHEREAS,
for Federal
income tax purposes,
it is intended that
the Merger
shall qualify as a tax-free reorganization under the provisions of Section
368(a) of the Internal Revenue Code of 1986, as amended
(the "Code"),
and the
rules and regulations promulgated
thereunder; and
WHEREAS,
the purposes of
creating the holding
company structure are to
separate Swift's domestic and international operations to more closely
reflect
Swift Energy Company's management structure, provide more organizational
flexibility, and provide for a more
equitable allocation of state taxes.
NOW,
THEREFORE,
in consideration of the mutual covenants and
agreements
contained in this Plan, the parties hereto
agree as follows:
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ARTICLE I
The Merger
Section 1.1 The
Merger.
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(a) Upon the
terms and subject to
the conditions
set forth in this
Plan,
and in accordance with Article 5.01, Article 5.03.H and other applicable
provisions of the TBCA, and Article 10.01
and other applicable provisions of the
TLLCA, Old Swift shall be merged into Merger Sub at the Effective Time (as
defined in Section 1.2 of this Plan). At the Effective Time, the separate
corporate existence of Old Swift shall cease and
Merger Sub shall
continue as
the surviving entity (the "Surviving
Entity") as a wholly
owned subsidiary
of
New Swift. Except as otherwise provided in
this Plan, the Surviving Entity shall
succeed to and assume all the rights, title
and interests to all real estate and
other property owned by Old Swift and all
the liabilities and obligations of Old
Swift, in accordance with the TBCA and the
TLLCA.
(b) At the
Effective Time, by virtue of the Merger and
without any action
on the part of Old Swift, New Swift, Merger
Sub or the holders of any securities
of Old Swift, New Swift or Merger Sub:
(1) each issued and outstanding share of Old Swift Common Stock
shall be
converted into one
issued and outstanding
share of New Swift
Common
Stock, having the same
designations,
preferences,
limitations
and
relative rights as the converted shares of Old Swift Common Stock;
and
(2) each issued but not outstanding share of Old Swift Common Stock
held
in
treasury by Old Swift
shall be converted
into one issued but
not
outstanding share of
New Swift Common
Stock held in treasury
by New
Swift, having the same
designations,
preferences,
limitations
and
relative rights as the converted shares of Old Swift Common Stock
held
in treasury.
(c) Each share
of New Swift Common Stock outstanding immediately prior to
the Effective Time shall, by virtue of the
Merger, and without any action on the
part of Old Swift, New Swift, Merger Sub or
the holders of any securities of Old
Swift, New Swift or Merger Sub, be cancelled and retired without any
consideration therefor.
(d) Each Merger Sub unit of common membership interest outstanding
immediately prior to the Effective Time shall
remain issued and outstanding and
remain held by New Swift so that following
the Merger New Swift continues as the
sole member of Merger Sub.
(e) From and
after the Effective
Time, holders of
certificates
formerly
evidencing Old Swift Common Stock shall
cease to have any rights as shareholders
of Old Swift, except as provided by
law.
(f) This Plan
has been duly
authorized by each of
Old Swift and New Swift
by all action required by the TBCA or by their
Articles of
Incorporation
or
Bylaws.
(g) Pursuant to
Article 5.03.H of the
TBCA, the approval of
the Merger by
the shareholders of Old Swift is not
required.
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(h) This Plan
has been authorized by
Merger Sub by all action required by
the TLLCA or by Merger Sub's constituent
documents.
Section 1.2
Effective Time. The parties shall execute and file
this Plan
with the Secretary of State of the State of Texas, and shall make all other
filings or recordings required under the TBCA and the
TLLCA to effectuate fully
the Merger. The Merger shall become effective at 9:00 a.m., local time in
Austin, Texas, on December 28, 2005 (the
time the Merger becomes effective being
here referred to as the "Effective
Time").
Section 1.3
Effects of the Merger.
The Merger
shall have the effects
set
forth in Article 5.06 of the TBCA and Article 10.04 of the TLLCA. It is the
intent of the parties that New Swift, as of the Effective Time, be deemed a
"successor issuer" to Old Swift for all
purposes under the
Securities
Act of
1933, as amended (the "Securities Act"), and for all purposes under the
Securities Exchange Act of 1934, as
amended. For Federal income tax purposes, it
is intended that the Merger shall qualify
as a tax-free reorganization under the
provisions of Section 368(a) of the
Code.
Section 1.4
Articles of Incorporation, Bylaws, Articles of Organization and
Regulations.
(a) Prior to the
Effective Time, New
Swift will cause to be adopted by the
appropriate corporate action, and filed
with the Secretary of State of the State
of Texas, Amendment No. 1 to the Articles of
Incorporation of New
Swift in the
form attached hereto as Exhibit A.1 which, at
the Effective Time (i) will amend
New Swift's Articles of Incorporation by changing New Swift's name to "Swift
Energy Company" and (ii) otherwise will
make no change to New Swift's Articles
of Incorporation. New Swift will cause to be adopted by the appropriate
corporate action, and after the Effective Time, filed with the Secretary of
State of the State of Texas, Restated
Articles of Incorporation of New Swift, in
the form attached hereto as Exhibit A.2
which will restate New Swift's Articles
of Incorporation as so amended. From and after the filing of New Swift's
Restated Articles of Incorporation, such
Restated Articles of Incorporation will
be the Articles of Incorporation of New Swift until thereafter changed or
amended as provided therein or under
applicable law.
(b) New
Swift's Board of Directors will take such action as may be
necessary to amend and restate the Bylaws
of New Swift as of the Effective Time
so that from and after the Effective Time
the Amended and Restated Bylaws of New
Swift in the form attached hereto as Exhibit B.1,
which amend and
restate New
Swift's Bylaws to reflect that its name has been changed to Swift Energy
Company, and otherwise make no change in
New Swift's Bylaws, will be the Bylaws
of New Swift until thereafter changed or amended as provided
therein or under
applicable law.
(c) New Swift,
acting as Merger Sub's
sole member, and
Merger Sub's Board
of Managers, will take such action as may be necessary to: (i) amend the
Articles of Organization and/or Regulations of Merger Sub as of
the Effective
Time so that from and after the Effective
Time the Articles of Organization (as
amended) and the Regulations of Merger Sub, in the forms
attached hereto as
Exhibits C.1 and C.2, contain the provisions required or permitted by
Article
5.03.H of the TBCA, and (ii) otherwise make no change in Merger
Sub's Articles
of Organization or Regulations. Merger
Sub's sole member, and Member Sub's Board
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<PAGE>
of Managers will take such action as may be necessary to restate after the
Effective Time Merger Sub's Articles of
Organization as so amended, in the form
attached hereto as Exhibit C.3, and such
Restated Articles of
Organization and
Regulations (as amended) will be the
Articles of Organization and Regulations of
the Surviving Entity until thereafter
changed or amended as
provided therein or
under applicable law.
Section 1.5
Directors.
At the Effective Time the directors of Old
Swift
immediately prior to the Effective Time will
be and remain the directors of New
Swift until the earlier of their resignation or removal or until their
respective successors are qualified and either duly appointed or elected in
accordance with the Articles of Incorporation and Bylaws of New Swift and
applicable law. At the Effective Time each
of the Class I directors of Old Swift
immediately prior to the Effective Time will
be and remain Class I directors of
New Swift whose terms, subject to the first sentence of
this Section 1.5, shall
expire at the 2006 annual meeting of
shareholders of New Swift. At the Effective
Time each of the Class II directors of Old Swift immediately prior to the
Effective Time will be and remain
Class II directors of
New Swift whose terms,
subject to the first sentence of this Section 1.5, shall expire at the 2007
annual meeting of shareholders of New Swift. At the Effective
Time each of the
Class III dir
