How much debt did APA issue in this transaction and what were the net proceeds?

APA sold $350,000,000 of 6.10% Notes due 2035 and $500,000,000 of 6.75% Notes due 2055, closing January 10, 2025. Net proceeds after initial purchasers' discounts and estimated offering expenses were approximately $839 million.

What was the use of proceeds from the new notes?

The company used the net proceeds to fund a portion of the purchase of Apache Tender Notes in the cash tender offers.

Who guarantees the new notes?

Apache Corporation, a wholly owned subsidiary, fully and unconditionally guarantees the notes until the first time the aggregate principal of Apache's existing senior notes and debentures is less than $1,000,000,000.

Did holders of Apache notes exchange them for APA notes?

Yes. The exchange offers settled on January 10, 2025, with holders of 14 Apache series exchanging for new APA notes that carry identical interest rates and maturity dates. The new APA notes are not registered under the Securities Act.

What happens if the exchange offers are not completed on time?

If the exchange offers are not completed by the 360th day after January 10, 2025, additional interest accrues at 0.25% per annum for the first 90-day period, increasing by 0.25% for each subsequent 90-day period, capped at 1.00% per annum.

APA 8-K: Material Agreements

01—Abstract

Summary

Summary of the 8-K filed January 10, 2025. Cited figures are marked; the original filing is the authoritative source.

APA Corporation (APA) entered into a Purchase Agreement on January 7, 2025 to sell $350,000,000^a of 6.10% Notes due 2035 and $500,000,000 of 6.75% Notes due 2055 in a private offering.

The sale closed on January 10, 2025, with net proceeds of approximately $839 million^b, which the company used to help fund the purchase of Apache Tender Notes. Apache Corporation, a wholly owned subsidiary, fully and unconditionally guarantees the new notes until Apache's existing senior notes and debentures fall below $1,000,000,000 in aggregate principal. On January 10, 2025, the company settled exchange offers and cash tender offers for Apache's outstanding notes and debentures.

Holders tendered and had accepted $6.2 billion^c... Specifically, the filing lists tendered and accepted principal amounts totaling roughly $4.94 billion across fourteen series, which the company exchanged for new APA notes with identical rates and maturities, and it paid $868,893,748 in cash as tender consideration for the five series subject to the cash tender offers. Following the offers, Apache retained smaller balances of each series, and Apache solicited consents to remove certain restrictive and reporting covenants from the applicable indentures; consents were received and supplemental indentures took effect January 10, 2025.

The filing also describes registration rights agreements requiring the company and Apache to pursue registered exchange offers for the new notes, with additional interest of 0.25%^d per annum (increasing by 0.25% each 90-day period, capped at 1.00%) if exchange offers are not completed within 360 days of January 10, 2025. Investors should note that the filing states the agreements are not intended to provide other factual information about the company.

02—Key points

Key Highlights

Issued $350 million of 6.10% Notes due 2035 and $500 million of 6.75% Notes due 2055 in a Rule 144A and Regulation S private offering, closing January 10, 2025
Net proceeds of approximately $839 million, used to fund a portion of the purchase of Apache Tender Notes
Settled exchange offers for 14 series of Apache notes and debentures, with tendered and accepted principal amounts listed individually in the filing
Paid $868,893,748 in cash as tender consideration to holders of Apache Tender Notes (2037, 2040, 2042, 2043, and 2044 series) and $2,546,342 in cash as exchange consideration
Apache solicited and received consents to amend its indentures to remove certain restrictive and reporting covenants, with supplemental indentures effective January 10, 2025
Apache fully and unconditionally guarantees the new notes until its existing senior notes and debentures fall below $1,000,000,000 in aggregate principal
Registration rights agreements carry additional interest of 0.25% per annum, rising by 0.25% per 90-day period to a 1.00% cap, if exchange offers are not completed within 360 days

03—Questions

Frequently Asked Questions

How much debt did APA issue in this transaction and what were the net proceeds?
APA sold $350,000,000 of 6.10% Notes due 2035 and $500,000,000 of 6.75% Notes due 2055, closing January 10, 2025. Net proceeds after initial purchasers' discounts and estimated offering expenses were approximately $839 million.
What was the use of proceeds from the new notes?
The company used the net proceeds to fund a portion of the purchase of Apache Tender Notes in the cash tender offers.
Who guarantees the new notes?
Apache Corporation, a wholly owned subsidiary, fully and unconditionally guarantees the notes until the first time the aggregate principal of Apache's existing senior notes and debentures is less than $1,000,000,000.
Did holders of Apache notes exchange them for APA notes?
Yes. The exchange offers settled on January 10, 2025, with holders of 14 Apache series exchanging for new APA notes that carry identical interest rates and maturity dates. The new APA notes are not registered under the Securities Act.
What happens if the exchange offers are not completed on time?
If the exchange offers are not completed by the 360th day after January 10, 2025, additional interest accrues at 0.25% per annum for the first 90-day period, increasing by 0.25% for each subsequent 90-day period, capped at 1.00% per annum.

04—Continue

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