| Item 1.01 | Entry into a Material Definitive Agreement. |
On September 18, 2018, Northern Oil and Gas, Inc. (the “Company”) entered into the First Supplemental Indenture (the “First Supplemental Indenture”) among the Company and Wilmington Trust, National Association, as Trustee (the “Trustee”) and as collateral agent (the “Collateral Agent”), to the indenture dated as of May 15, 2018, among the Company, the Trustee and the Collateral Agent (the “Indenture”). The First Supplemental Indenture, among other things, (a) amends the Indenture to (i) incorporate customary mechanics for the issuance of additional senior secured notes thereunder; (ii) provide for the entry into a new credit facility; (iii) permit the Company to make certain restricted payments; and (iv) incorporate updates to the reporting, debt, hedging, investments and additional collateral covenants and (b) permits certain corresponding changes to the related intercreditor agreement.
The foregoing description of the First Supplemental Indenture is qualified in its entirety by reference to such First Supplemental Indenture, a copy of which is filed herewith as Exhibit 4.1 and is incorporated herein by reference.
| Item 2.01. | Completion of Acquisition or Disposition of Assets. |
On September 17, 2018, the Company completed the acquisition of certain oil and gas properties and interests from affiliates of Pivotal Petroleum Partners LP and Pivotal Petroleum Partners II LP,, namely Pivotal Williston Basin, LP and Pivotal Williston Basin II, LP (together, the “Pivotal Entities”), effective as of June 1, 2018 (the “Pivotal Acquisitions”). The acquired assets primarily consist of a package of producing wells, with the Company acquiring approximately 20.8 net producing wells and 2.2 net wells in process, as well as approximately 444 net acres in North Dakota.
In accordance with their respective purchase and sale agreement (collectively, the “Purchase Agreements”), Pivotal Williston Basin, LP received $14.6 million and 5,930,100 shares of our common stock, par value $0.001 per share (the “Common Stock”) and Pivotal Williston Basin II, LP received $46.0 million and 19,823,478 shares of Common Stock. In each case, the cash portion of the initial consideration is net of preliminary and customary purchase price adjustments and remains subject to final post-closing settlement between the Company and each Pivotal Entity, which are expected to be finalized during the first quarter of 2019. The Company funded the cash portion of the closing payments with cash on hand.
Each Purchase Agreement provides for a limitedlock-up on the shares issued at closing over a13-month post-closing period, and also provides for potential additional consideration to be paid by the Company during the13-month post-closing period if its Common Stock trades below certain price targets. Any such additional consideration may be paid, at the Company’s election, in either cash or additional shares of Common Stock. The material terms of the Purchase Agreements were previously disclosed in Item 1.01 of the Current Report onForm 8-K filed on July 20, 2018 (file no.001-33999), which is incorporated herein by reference.
In accordance with the Purchase Agreements, the Company entered into a Registration Rights Agreement with the Pivotal entities, dated September 17, 2018, which obligates the Company to prepare and file a registration statement covering the resale of the shares of Common Stock issued and issuable under the Purchase Agreements and to seek and maintain effectiveness of the same. The Company has agreed, among other things, to indemnify the selling stockholders under the registration statement with respect to certain liabilities and to pay all fees and expenses incident to the Company’s obligations under the Registration Rights Agreement. The foregoing description of the Registration Rights Agreement and the transactions contemplated thereby does not purport to be complete and is subject to, and qualified by, the full text of the Registration Rights Agreement, which is filed as Exhibit 10.1 hereto and incorporated herein by reference.
| Item 3.02 | Unregistered Sales of Equity Securities. |
Exchange Agreements
On September 14, 2018, the Company entered into two exchange agreements with holders of the Company’s 8.00% senior unsecured notes due 2020 (the “Unsecured Notes”).
