--- schema_version: "secwatch.filing_event.v1" accession: "0000010254-23-000160" form_type: "8-K" ticker: null cik: "0000010254" company_name: "EARTHSTONE ENERGY INC" filed_at: "2023-08-17T23:59:59+00:00" generated_at: "2026-06-11T07:19:12.315585+00:00" event_type: "m_and_a" sentiment: "positive" materiality_score: 0.85 calibrated_materiality_score: 0.85 confidence: "high" source: SEC EDGAR --- # Earthstone closes $1.4B Novo acquisition; expects Q4 production >130K Boepd ## Summary - Closed acquisition of Novo for ~$1.4B cash; funded via cash on hand and credit facility; NOG paid $468.4M for 1/3 interest. - EnCap now owns ~39.9% of Earthstone voting power; conflicts committee approved the related-party deal. - Credit facility amended: borrowing base increased from $1.65B to $2.0B; elected commitments raised to $1.75B. - CEO: Q4 2023 production estimated >130,000 Boepd; adds over 200 high-return, de-risked drilling locations. - Management expects 2024 free cash flow to increase by more than 60% and meaningful EBITDAX growth. ## SEC filing metadata - accession: 0000010254-23-000160 - form_type: 8-K - cik: 0000010254 - company_name: EARTHSTONE ENERGY INC - filed_at: 2023-08-17T23:59:59+00:00 - event_type: m_and_a - sentiment: positive - materiality_score: 0.85 - calibrated_materiality_score: 0.85 - confidence: high - sec_items: 1.01, 2.01, 2.03, 7.01, 9.01 - EDGAR index: https://www.sec.gov/Archives/edgar/data/10254/000001025423000160/0000010254-23-000160-index.htm - EDGAR primary document: https://www.sec.gov/Archives/edgar/data/10254/000001025423000160/este-20230815.htm ## Machine-readable alternates - HTML: https://secwatch.observer/filing/0000010254-23-000160 - JSON: https://secwatch.observer/filing/0000010254-23-000160.json - Plain text: https://secwatch.observer/filing/0000010254-23-000160.txt ## Key facts - M&A Transactions EARTHSTONE ENERGY INC completed a disposition involving Northern Oil and Gas, Inc. for approximately $468.4 million in cash (closed 2023-08-15). - Action: disposition - Counterparty: Northern Oil and Gas, Inc. - Consideration: approximately $468.4 million in cash - Closing: 2023-08-15 source text: on August 15, 2023, immediately after the completion of the Acquisition, the Novo Divestiture was completed whereby the Company received approximately $468.4 million in cash (which includes a $37.5 million cash deposit previously paid into escrow by NOG upon the execution of the Cooperation Agreement) from NOG pursuant to the Cooperation Agreement in exchange for the transfer to NOG of an undivided one-third interest in the Novo Assets. evidence_url: https://www.sec.gov/Archives/edgar/data/10254/000001025423000160/0000010254-23-000160-index.htm - M&A Transactions EARTHSTONE ENERGY INC completed an acquisition involving Novo Oil & Gas Holdings, LLC for aggregate cash consideration of approximately $1.4 billion (closed 2023-08-15). - Action: acquisition - Counterparty: Novo Oil & Gas Holdings, LLC - Consideration: aggregate cash consideration of approximately $1.4 billion - Closing: 2023-08-15 source text: On August 15, 2023, the Company completed the Acquisition. After taking into account preliminary customary purchase price adjustments at closing, the Company paid aggregate cash consideration of approximately $1.4 billion (which includes a $112.5 million cash deposit previously paid into escrow by the Company and NOG upon execution of the Purchase Agreement and the Cooperation Agreement), which was funded with a combination of cash on hand (including cash proceeds received pursuant to the Novo Divestiture) and borrowings under the Credit Agreement. evidence_url: https://www.sec.gov/Archives/edgar/data/10254/000001025423000160/0000010254-23-000160-index.htm - Material Agreements EARTHSTONE ENERGY INC entered into Supplement to the Guarantee and Collateral Agreement with Company, Earthstone, guarantors, Novo, Novo Subsidiaries valued at Company pledged Equity Interests described in Annex 1-A (effective 2023-08-15). - Action: entry - Agreement: credit facility - Counterparty: Company, Earthstone, guarantors, Novo, Novo Subsidiaries - Value: Company pledged Equity Interests described in Annex 1-A - Effective: 2023-08-15 source text: the Company entered into the Supplement to the Guarantee and Collateral Agreement whereby the Company pledged the Equity Interests described in Annex 1-A thereto (the “Supplement”) evidence_url: https://www.sec.gov/Archives/edgar/data/10254/000001025423000160/0000010254-23-000160-index.htm - Material Agreements EARTHSTONE ENERGY INC entered into First Supplemental Indenture (2022 Notes) with Company, Earthstone, guarantors, Novo, Novo Subsidiaries, U.S. Bank Trust Company, National Association as Trustee valued at Added Novo and Novo Subsidiaries as additional guarantors to 8.000% senior notes indenture dated Apr (effective 2023-08-15). - Action: entry - Agreement: notes offering - Counterparty: Company, Earthstone, guarantors, Novo, Novo Subsidiaries, U.S. Bank Trust Company, National Association as Trustee - Value: Added Novo and Novo Subsidiaries as additional guarantors to 8.000% senior notes indenture dated Apr - Effective: 2023-08-15 source text: the Company, Earthstone, the guarantors party thereto, Novo, the Novo Subsidiaries and U.S. Bank Trust Company, National Association, as Trustee, entered into (i) a First Supplemental Indenture which added Novo and the Novo Subsidiaries as additional guarantors to the Company’s existing indenture governing its 8.000% senior notes dated as of April 12, 2022 (the “2022 Notes Supplemental Indenture”) evidence_url: https://www.sec.gov/Archives/edgar/data/10254/000001025423000160/0000010254-23-000160-index.htm - Material Agreements EARTHSTONE ENERGY INC entered into Assumption Agreement (Credit Agreement) with Novo Oil & Gas Texas, LLC, Novo Oil & Gas Northern Delaware, LLC, Scala Energy Assets, LLC, Scala Energy Operating, LLC, Novo, Wells Fargo as Administrative Agent valued at Novo and Novo Subsidiaries guaranteed obligations under the Credit Agreement (effective 2023-08-15). - Action: entry - Agreement: credit facility - Counterparty: Novo Oil & Gas Texas, LLC, Novo Oil & Gas Northern Delaware, LLC, Scala Energy Assets, LLC, Scala Energy Operating, LLC, Novo, Wells Fargo as Administrative Agent - Value: Novo and Novo Subsidiaries guaranteed obligations under the Credit Agreement - Effective: 2023-08-15 source text: On August 15, 2023, (i) Novo Oil & Gas Texas, LLC, Novo Oil & Gas Northern Delaware, LLC, Scala Energy Assets, LLC and Scala Energy Operating, LLC, each being a wholly-owned subsidiary of Novo (together, the “Novo Subsidiaries”) and Novo, entered into an Assumption Agreement (the “Assumption Agreement”) joining each to that certain Credit Agreement, dated as of November 21, 2019, by and among the Company, as Borrower, Earthstone, as Parent, Wells Fargo, as Administrative Agent and Issuing Bank, the Lenders party thereto and the documentation agents party thereto (as amended, restated, amended and restated, supplemented or otherwise modified from time to time, the “Credit Agreement”), whereby Novo and the Novo Subsidiaries agreed to guarantee the obligations under the Credit Agreement evidence_url: https://www.sec.gov/Archives/edgar/data/10254/000001025423000160/0000010254-23-000160-index.htm - Material Agreements EARTHSTONE ENERGY INC entered into First Supplemental Indenture (2023 Notes) with Company, Earthstone, guarantors, Novo, Novo Subsidiaries, U.S. Bank Trust Company, National Association as Trustee valued at Added Novo and Novo Subsidiaries as additional guarantors to 9.875% senior notes indenture dated Jun (effective 2023-08-15). - Action: entry - Agreement: notes offering - Counterparty: Company, Earthstone, guarantors, Novo, Novo Subsidiaries, U.S. Bank Trust Company, National Association as Trustee - Value: Added Novo and Novo Subsidiaries as additional guarantors to 9.875% senior notes indenture dated Jun - Effective: 2023-08-15 source text: the Company, Earthstone, the guarantors party thereto, Novo, the Novo Subsidiaries and U.S. Bank Trust Company, National Association, as Trustee, entered into (i) a First Supplemental Indenture which added Novo and the Novo Subsidiaries as additional guarantors to the Company’s existing indenture governing its 8.000% senior notes dated as of April 12, 2022 (the “2022 Notes Supplemental Indenture”) and (ii) a First Supplemental Indenture which added Novo and the Novo Subsidiaries as additional guarantors to the Company’s existing indenture governing its 9.875% senior notes dated as of June 30, 2023 (the “2023 Notes Supplemental Indenture”) evidence_url: https://www.sec.gov/Archives/edgar/data/10254/000001025423000160/0000010254-23-000160-index.htm This AI-assisted summary is a reading aid. Review the linked SEC EDGAR filing before relying on any specific claim.