Robert P. Rayphole
APAAbout Robert P. Rayphole
APA appointed Robert P. Rayphole (age 51) as vice president, chief accounting officer (CAO) and controller effective Nov 15, 2025; he is a CPA with more than two decades at APA in reporting, investor relations, and controllership, and earlier experience at Arthur Andersen . Effective on appointment, his annual base salary is $355,000, with a 50% target annual bonus and a 225% target long‑term incentive beginning Jan 1, 2026 . Company performance context: APA reported 2024 net income of $804 million and free cash flow of $841 million in the Pay vs Performance disclosure, with 2024 annual incentive scorecard payout at 109% for NEOs, underscoring a cash/efficiency focus in incentives .
Company Performance Context (select metrics)
| Metric | FY 2024 |
|---|---|
| Net Income ($mm) | 804 |
| Free Cash Flow ($mm) | 841 |
| Corporate AIP Payout vs Target (%) | 109% |
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| APA Corporation | VP, Chief Accounting Officer & Controller | 2025–present | Leads global accounting, financial reporting, accounting operations, SEC/GAAP compliance |
| APA Corporation | Assistant Controller | 2011–2025 | Oversight of controllership and internal controls; prepared for CAO succession |
| APA Corporation | Director, Investor Relations | 2010–2011 | External communications with investors/analysts during portfolio evolution |
| APA Corporation | Manager, Financial Reporting & U.S. Operations Accounting | 2002–2010 | SEC reporting and U.S. operations accounting; foundation for CAO role |
| Arthur Andersen LLP | Assurance (Manager) | 1997–2002 | Audit and assurance experience; CPA credential development |
External Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| — | — | — | None disclosed in company filings |
Fixed Compensation
| Component | Value / % | Effective date | Notes |
|---|---|---|---|
| Base salary | $355,000 | Nov 15, 2025 | Approved by MD&C Committee concurrent with appointment |
| Target annual incentive | 50% of base | Nov 15, 2025 | Based on corporate scorecard and individual factor per APA plan |
| Target LTI opportunity | 225% of base | Jan 1, 2026 | Mix and metrics per APA LTI framework (see below) |
Performance Compensation
Annual Incentive Plan (Corporate Scorecard design and 2024 results)
- Structure: Quantitative metrics (80%) across financial, operational, sustainability; qualitative strategic goals (20%). Targets set annually relative to plan, with commodity-price calibration .
- 2024 corporate scorecard (for NEOs; design expected to inform CAO’s plan going forward):
| Objective/Metric | Payout contribution (%) | Notes on target/actual/definition |
|---|---|---|
| Free Cash Flow ($mm) | 18% | Focus on conservative budgeting/cost control; defined upstream asset CF less capex and corporate items (before dividends; working capital excluded) |
| Cash Costs per BOE ($/BOE) | 26% | Operational efficiency; lifting/workover/overhead per adjusted BOE; adjusted for portfolio/macro items |
| Drilling Capital Efficiency (P/I) | 9% | Profitability index at 10% discount; fully burdened; Suriname exploration excluded |
| All‑in Finding & Development ($/BOE) | 10% | GAAP upstream costs per proved reserves added |
| Air (diesel reduction projects) | 20% | Sustainability execution metric |
| Safety (severe incident rate) | 6% | Safety performance |
| Safety (Life‑Saving Rules inspections >30% leadership participation) | 10% | Safety culture indicator |
| FCF to Shareholders (≥60% return) | 10% | Actual ~70% returned; exceeded target |
| Long‑Term Outlook (materially improve) | 0% | Partial progress; international headwinds |
| Final corporate score | 109% | Committee-calculated payout vs target |
- Individual performance factor range 0–200%; 100% applied to NEOs in 2024 (no adjustment) .
Long-Term Incentive (LTI)
- 2024 program structure for executives: 60% performance awards (3-year performance), 40% time‑based RSUs (ratable over 3 years). Performance awards vest 50% at end of year 3 and 50% at end of year 4 to reinforce long-term alignment .
- 2024–2026 performance metrics and weights:
- Relative TSR: 40% vs a defined peer set plus S&P 500 (weighted twice); payout scale 0–200%, capped at 100% if absolute TSR negative .
- CROIC: 40% on 3-year average vs target calibrated to oil price; multi-year cash returns focus .
- Sustainability: 20% focused on CO2e emissions reduction projects; externally verified .
- Realized example (NEO cohort): 2022–2024 performance awards earned at 118% (CROIC above target; TSR at 0% for that cycle; sustainability achieved). 50% vested Feb 5, 2025; remaining 50% vests Jan 1, 2026 .
2025 LTI changes (will influence Rayphole’s 2026 target LTI)
- Added stock options to the equity mix (greater at‑risk, stock‑price sensitivity); reduced time‑based RSUs; increased emphasis on relative TSR within performance awards; maintains CROIC .
Equity Ownership & Alignment
| Policy/Practice | Detail |
|---|---|
| Executive stock ownership guidelines | Officers must own APA stock equal in value to a specified multiple of base salary; plus a 15% after‑tax hold requirement on shares acquired on vesting/realization . |
| Hedging / pledging | Prohibited for executive officers and non‑employee directors; no pledging or margin use of APA securities . |
| Clawback | Dodd‑Frank compliant recoupment: incentive compensation may be recovered in connection with an accounting restatement for material noncompliance (post Oct 2, 2023); prior policy applies pre‑that date . |
| Grant practices | Annual grants in early January; no options granted in 2024; options added for 2025; options struck at or above closing price on grant date . |
Note: Beneficial ownership (direct/indirect, vested/unvested, pledged shares) for Mr. Rayphole is not disclosed in the 2025 proxy or the appointment 8‑K; company policy states executives comply with hedging/pledging prohibitions .
Employment Terms
| Term | Detail |
|---|---|
| Appointment | Appointed VP, Chief Accounting Officer & Controller effective Nov 15, 2025 . |
| Reporting & scope | Leads accounting, financial reporting, accounting operations, and GAAP/SEC compliance globally . |
| Relationships/related‑party | No family relationships with directors/executives; no related person transactions; no arrangements/understandings for selection . |
| Employment contracts | APA does not utilize executive officer employment contracts (governance best practices) . |
| Insider trading | Subject to APA insider trading policy and blackout procedures; policy administered by Corporate Secretary . |
Severance and Change‑of‑Control Economics (Plan Terms)
| Plan | Applicability | Key economics |
|---|---|---|
| Executive Termination Policy (ETP) | NEOs only (not automatically applicable to CAO unless designated NEO) | Termination without cause: prorated target bonus; 12 months COBRA subsidy; prorated RSU vesting; stock option exercise extension; prorated performance awards paid per plan at end of period; cash severance equals 2x base (CEO) or 1.75x base (other NEOs) . |
| Income Continuance Plan (ICP) | All officers (including NEOs) and certain long‑service/employees | Double‑trigger (termination in connection with/within 2 yrs of a change in control): for executive officers, lump sum = 12× monthly compensation; plus continued monthly compensation for 24 months; prorated bonus; 2 years of employer retirement contributions; medical/dental/vision/EAP at active rates (gross‑up if after‑tax); continued life insurance for 24 months . |
| CIC vesting & death/disability | Equity awards fully accelerated upon death or disability; CIC treatment per plan and award agreements; double‑trigger emphasized in policy . |
Say‑on‑Pay and Shareholder Feedback
| Item | Result/Insight |
|---|---|
| 2024 shareholder engagement | Outreach to holders of ~63% of shares; ~54% met or waived meeting; directors available . |
| Most recent say‑on‑pay support | Approximately 70% approval (APA acknowledged investor feedback, increased disclosure on goal‑setting and benchmarking) . |
| Compensation consultant | Pearl Meyer served as independent advisor to MD&C Committee in 2024 . |
| Compensation peer group | E&P peers used for benchmarking (e.g., EOG, Devon, Occidental, ConocoPhillips, Diamondback, etc.); updates reflect industry M&A (e.g., replacement of Pioneer with Civitas for 2025) . |
Expertise & Qualifications
- Credentials: Certified Public Accountant; BBA and Master’s in Accounting from Texas A&M University .
- Core expertise: Financial reporting, internal controls, external audit/assurance, SEC/GAAP compliance, investor relations .
Performance Compensation – Metric Detail and Vesting (Reference Framework)
| Metric | Weight | Targeting approach | Payout scale | Vesting |
|---|---|---|---|---|
| Relative TSR | 40% | Ranked vs defined peer group + S&P 500 (weighted twice) | 0–200%; capped at 100% if absolute TSR negative; median rank yields 95% . | 50% at end of year 3; 50% at end of year 4 . |
| CROIC | 40% | 3‑yr average vs targets calibrated to oil price; cash returns focus | 50–200% of target, per matrix . | Same as above . |
| Sustainability (CO2e) | 20% | Project‑based emissions reductions, externally verified | Threshold/target/max per plan . | Same as above . |
| Time‑based RSUs | n/a | Talent retention, alignment | n/a | Ratable over 3 years . |
| 2025 options (new) | n/a | Added to increase at‑risk, price‑sensitive pay | n/a | Per award agreement; introduced 2025 . |
Risk Indicators & Governance
- No hedging/pledging permitted; robust insider trading controls and blackout procedures .
- Clawback policy aligned with SEC listing standards (post Oct 2, 2023) .
- Double‑trigger CIC; no executive employment contracts; no option repricing; options added to increase performance linkage in 2025 .
- 2024 AIP target‑setting rationale enhanced to address investor concerns on “targets below prior results,” clarifying commodity calibration and plan rigor .
Investment Implications
- Alignment: Rayphole’s pay mix (50% bonus; 225% LTI) plus APA’s 3–4 year vesting and TSR/CROIC weighting signal strong linkage to cash discipline, capital efficiency, and relative share performance; hedging/pledging bans and 15% post‑tax hold enhance alignment .
- Retention: Absence of fixed‑term contracts mitigated by competitive LTI and clear CIC protection for officers under the ICP; 2025 introduction of options increases upside retention and stock sensitivity .
- Selling pressure: Multi‑year vesting (RSUs over 3 years; performance awards over 4 years; 2025 options) tends to stagger potential supply from vesting, reducing near‑term overhang; policy‑driven post‑tax holding further tempers selling .
- Governance watch‑items: Say‑on‑pay support at ~70% warrants continued monitoring of program responsiveness; however, APA disclosed specific enhancements and peer group changes reflecting investor feedback .
Note: Beneficial ownership totals, vesting share counts, and any insider transactions for Mr. Rayphole are not disclosed in the proxy or appointment 8‑K; monitor future Forms 3/4 for initial/ongoing ownership and any trading activity .