HNR Acquisition Corp. (NYSE:HNRA) announced this afternoon that it has reworked its combination with oil developer Pogo Resources to purchase all of the equity interests of the target.

The SPAC amended the membership interest purchase agreement to revise the purchase price to an aggregate amount of $63 million in cash plus two million shares of a new class of Class B Common Stock, which have no economic rights, and two million units in the company’s newly-formed subsidiary, HNRA Upstream, LLC, which are exchangeable for two million shares of newly created Class A Common Stock.

On August 28th, HNR signed a commitment letter with First International Bank & Trust for a $28 million senior secured term loan to fund a portion of this purchase price.

Initially, the deal carried a $100 million minimum cash condition and stipulated that no more than $15 million of this cash consideration be made up by the promissory note.

However, the parties amended this so that the cash required at closing can be reduced by $15 million payable through a promissory note to sellers, and up to another $20 million through the issuance of preferred units, which convert into shares of HNR’s proposed new Class B common stock in two years, at a conversion rate based on the stock price at the time.

Within one year thereafter, the Class B common stock may be converted into the proposed Class A common stock. At a minimum, the company must pay the sellers $33 million in cash at closing.

Additionally, Pogo Resources transferred a 10% overriding royalty interest in oil, gas and minerals in, under and produced from each lease to an affiliate that will not be purchased by the company. Then, in connection with the amendment, the company will be granted a 12-month option to purchase the interest for $30 million.

HNR inked its membership purchase agreement with Pogo Resources earlier this year in January. The target fields comprise 13,700 leasehold acres, 343 producing wells and 207 injection wells for a total of 550 wells on the properties. Management expects to increase daily production to nearly 4,000 barrels of oil and oil equivalent in the next three years.

In October, HNR entered into a common stock purchase agreement with White Lion Capital, under which White Lion could be directed to purchase up to $150 million in newly issued shares of the combined company between close and December 31, 2025.