APA 8-K 2024-03-15

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d)

of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): March 15, 2024

APA CORPORATION

(Exact name of registrant as specified in its charter)

2000 Post Oak Boulevard, Suite 100

Houston, Texas 77056-4400

(Address of principal executive offices) (Zip Code)

Registrant’s telephone number, including area code: (713) 296-6000

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Securities registered pursuant to Section 12(b) of the Act:

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

As previously disclosed, on January 3, 2024, APA Corporation, a Delaware corporation (“APA”), entered into an Agreement and Plan of Merger (the “Merger Agreement”) with Callon Petroleum Company, a Delaware corporation (“Callon”), and Astro Comet Merger Sub Corp., a Delaware corporation and a wholly owned subsidiary of APA (“Merger Sub”), pursuant to which, upon the terms and subject to the conditions set forth therein, (1) Merger Sub will be merged with and into Callon (the “Merger”), with Callon surviving and continuing as the surviving corporation in the Merger as a wholly owned, direct subsidiary of APA, and (2) at the effective time of the Merger, each outstanding share of common stock of Callon (other than Excluded Shares (as defined in the Merger Agreement)) will be converted into the right to receive, without interest, 1.0425 shares of common stock of APA, with cash in lieu of fractional shares. APA has filed with the Securities and Exchange Commission (the “SEC”) a Registration Statement on Form S-4 (the “Registration Statement”), which included a preliminary joint proxy statement/prospectus for the solicitation of proxies in connection with the special meetings of APA’s and Callon’s stockholders, to be held on March 27, 2024, to vote upon, among other things, matters necessary to complete the Merger. The SEC declared the Registration Statement effective on February 15, 2024, and APA filed a definitive joint proxy statement/prospectus (the “Proxy Statement/Prospectus”) on February 16, 2024. APA commenced mailing of the Proxy Statement/Prospectus to its stockholders on or about February 16, 2024.

Litigation Related to the Merger

As of the date hereof, APA has, to its knowledge, received a total of two demand letters from its purported stockholders (the “APA Demand Letters”), Callon has, to its knowledge, received a total of thirteen demand letters from its purported stockholders (together with the APA Demand Letters, the “Demand Letters”) and five complaints have been filed with respect to the Merger. The complaints are captioned as follows: Zachary Woodbury v. Callon Petroleum Company, et al., Case No. 1:24-cv-01271 (S.D.N.Y.) (the “Woodbury Action”), Dean Drulias v. Callon Petroleum Company, et al., Cause No. 2024-11563 (Harris Cnty., Tex.) (the “Drulias Action”), William Durling v. Callon Petroleum Company, et al., Case No. 2024-0203 1:24-cv-01271 (Del. Ch.) (the “Durling Action”), and William Ballard v. Callon Petroleum Company, et al., Case No. 1:24-cv-01866 (S.D.N.Y) (the “Ballard Action”) and Robert Williams v. Callon Petroleum Company et al., Case No. 1:24-cv-00331 (D. Del.) (the “Williams Action”) (collectively referred to as the “Stockholder Actions”). The Woodbury Action, the Drulias Action, the Durling Action, the Ballard Action and the Williams Action were filed by purported Callon stockholders and name Callon and the members of the Callon board of directors as defendants. The Drulias Action also names APA as a defendant.

The Demand Letters and the Stockholder Actions allege that, among other things, the Proxy Statement/Prospectus contains certain disclosure deficiencies and/or incomplete information regarding the Merger. It is possible that additional, similar demand letters or complaints may be received or filed or the Stockholder Actions may be amended. APA does not intend to announce the receipt or filing of each additional, similar demand letter, complaint or any amended complaint. Although APA cannot predict the outcome of or estimate the possible loss or range of loss from these matters, APA believes that the allegations contained in the Demand Letters and Stockholder Actions are without merit.

APA believes that no supplemental disclosures are required under applicable laws; however, in order to avoid the risk of the Demand Letters and the Stockholder Actions delaying the Merger and minimize the expense of defending the Stockholder Actions, and without admitting any liability or wrongdoing, APA is voluntarily making certain disclosures below that supplement those contained in the Proxy Statement/Prospectus. These disclosures, and disclosures on certain other matters, are provided in this Current Report on Form 8-K. Nothing in this Current Report on Form 8-K shall be deemed an admission of the legal necessity or materiality under applicable laws of any of the disclosures set forth herein. To the contrary, APA specifically denies all allegations in the Demand Letters and the Stockholder Actions, including that any additional disclosure was or is required.

SUPPLEMENT TO PROXY STATEMENT/PROSPECTUS

This supplemental information to the Proxy Statement/Prospectus should be read in connection with the Proxy Statement/Prospectus, which should be read in its entirety. All page references are to pages in the Proxy Statement/Prospectus, and terms used below, unless otherwise defined, have the meanings set forth in the Proxy Statement/Prospectus.

The disclosure on page 47 of the Proxy Statement/Prospectus is hereby supplemented by inserting the following sentence at the end of the sixth paragraph:

Neither the APA October Proposal nor any other of APA’s offers to acquire Callon included any details regarding management retention or equity participation in the combined company for Callon management, other than with respect to outstanding equity awards held by Callon management, and there were no other discussions with APA regarding potential post-closing employment of Callon management.

The disclosure on page 49 of the Proxy Statement/Prospectus is hereby supplemented by inserting the following two sentences at the end of the seventh full paragraph:

Callon has agreed to pay RBCCM an aggregate fee for its servi

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