RESERVES GROWTH WITH  A REGIONAL FOCUS
	1994 ANNUAL REPORT
Notes to Consolidated Financial Statements Swift Energy Company and Subsidiaries

7. Stockholders' Equity

 

Common Stock. On September 6, 1994, the Company declared a 10% stock dividend to shareholders of record on September 19, 1994, which was distributed on September 29, 1994. The transaction was valued based on the closing price ($11.00) of the Company's common stock on the New York Stock Exchange on September 6, 1994. As a result of the issuance of 606,262 shares of the Company's common stock as a dividend, retained earnings were reduced by $6,668,882, with the common stock and additional paid-in capital accounts increased by the same amount. Primary and fully diluted income (loss) per share has been restated for all periods to reflect the effect of the stock dividend.

Stock Options and Warrants. The Company has an employee option plan under which incentive stock options and other options and awards maybe granted to employees to purchase shares of common stock and a nonqualified stock option plan under which non-employee members of the Company's Board of Directors may be granted options to purchase shares of common stock. he plans provide that the exercise prices equal 100% of the fair value of the common stock on the date of grant. Options become exercisable for 20% of the shares on the first anniversary of the grant of the option and are exercisable for an additional 20% per year thereafter. Options granted expire 10 years after the date of grant or earlier in the event of the optionee's separation from employment. No accounting entries are required until the stock options are exercised, at which time the option price is credited to the common stock and additional paid-in capital accounts. The effect of the 10% stock dividend increased the number of shares and decreased the price according to the respective agreements.

The following is a summary of stock options under these plans:

The Company also has granted certain stock options to individuals who are neither employees, officers, nor directors, for specific services rendered to the Company. At December 31, 1994, options granted in 1991 covering 68,750 shares at $9.773 (after adjustment for the September 1994 stock dividend) remain outstanding. During the three years ended December 31,1994, the only other activity has been the cancellation of 5,350 option shares in 1993.

The Company also has a plan which provides eligible employees the opportunity to acquire shares of Company common stock at a discount through payroll deductions. This plan was approved at the May 11, 1993, shareholders meeting. The plan year is from June 1 to the following May 31, with the first year of the plan commencing June 1, 1993. Employees may authorize payroll deductions of up to 10% of their base salary during the plan year by making an election to participate prior to the start of a plan year. The purchase price for stock acquired under the plan will be 85% of the lower of the closing price of the Company's common stock as quoted on the New York Stock Exchange at the beginning or end of the plan year or a date during the year chosen by the participant. During 1994, the Company issued 29,840 shares under this plan at a price of $8.71. As of December 31, 1994, there were 517,176 shares available for issuance under this plan. There are no charges or credits to income in connection with this plan.

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