Item 1.01 Entry into a Material Definitive
Agreement.
Common Stock Purchase Agreement
On October 17, 2022, HNR Acquisition
Corp (the “Company”) entered into a common stock purchase agreement (the “Common Stock Purchase Agreement”)
and a related registration rights agreement (the “White Lion RRA”) with White Lion Capital, LLC, a Nevada limited liability
company (“White Lion”). Pursuant to the Common Stock Purchase Agreement, the Company has the right, but not the obligation
to require White Lion to purchase, from time to time, up to $150,000,000 in aggregate gross purchase price of newly issued shares of the
Company’s Class A common stock, par value $0.0001 per share (the “Common Stock”), subject to certain limitations
and conditions set forth in the Common Stock Purchase Agreement. Capitalized terms used but not otherwise defined herein shall have the
meaning given to such terms by the Common Stock Purchase Agreement.
The Company is obligated under
the Common Stock Purchase Agreement and the White Lion RRA to file a registration statement with the U.S. Securities and Exchange Commission
(the “SEC”) to register the Common Stock under the Securities Act of 1933, as amended, for the resale by White Lion
of shares of Common Stock that the Company may issue to White Lion under the Common Stock Purchase Agreement.
Subject to the satisfaction
of certain customary conditions including, without limitation, the effectiveness of a registration statement registering the shares issuable
pursuant to the Common Stock Purchase Agreement, the Company’s right to sell shares to White Lion will commence on the effective
date of the registration statement and extend until December 31, 2025. During such term, subject to the terms and conditions of the Common
Stock Purchase Agreement, the Company may notify White Lion when the Company exercises its right to sell shares (the effective date of
such notice, a “Notice Date”). The number of shares sold pursuant to any such notice may not exceed (i) the lower of
(a) $2,000,000 and (b) the dollar amount equal to the product of (1) the Effective Daily Trading Volume (2) the closing price of Common
Stock on the Effective Date (3) 400% and (4) 30%, divided by the closing price of Common Stock on Nasdaq preceding the Notice Date and
(ii) a number of shares of Common Stock equal to the Average Daily Trading Volume multiplied by the Percentage Limit.
The purchase price to be paid
by White Lion for any such shares will equal 96% of the lowest daily volume-weighted average price of Common Stock during a period of
two consecutive trading days following the applicable Notice Date.
The Company will have the
right to terminate the Common Stock Purchase Agreement at any time after Commencement, at no cost or penalty, upon three trading days’
prior written notice. Additionally, White Lion will have the right to terminate the Common Stock Purchase Agreement upon three days’
prior written notice to the Company if (i) there is a Fundamental Transaction, (ii) the Company is in breach or default in any material
respect of the White Lion RRA, (iii) there is a lapse of the effectiveness, or unavailability of, the Registration Statement for a period
of 45 consecutive trading days or for more than an aggregate of 90 trading days in any 365-day period, (iv) the suspension of trading
of the Common Stock for a period of five consecutive trading days, (v) the material breach of the Common Stock Purchase Agreement by the
Company, which breach is not cured within the applicable cure period or (vi) a Material Adverse Effect has occurred and is continuing.
No termination of the Common Stock Purchase Agreement will affect the registration rights provisions contained in the White Lion RRA.
In consideration for the commitments
of White Lion, as described above, the Company has agreed that it will issue to White Lion shares of Common Stock having a value of $1,500,000
based on the volume-weighted average price of the Common Stock on a date which is the earlier to occur of (i) two Trading Days prior to
the filing of the registration statement it will file pursuant to the White Lion RRA and (ii) after the closing of any business combination
agreement, the Trading Day prior to the Investor sending a written request to the Company for such commitment shares, and to include such
shares in the registration statement it will file pursuant to the White Lion RRA.
Registration Rights
Agreement
Concurrently with the execution
of the Common Stock Purchase Agreement, the Company entered into the White Lion RRA with the White Lion in which the Company has agreed
to register the shares of Common Stock purchased by White Lion with the SEC for resale within 30 days of the consummation of a business
combination. As of the date of this filing, the Company has not executed any business combination agreement. The White Lion RRA also contains
usual and customary damages provisions for failure to file and failure to have the registration statement declared effective by the SEC
within the time periods specified.
The Common Stock Purchase
Agreement and the White Lion RRA contain customary representations, warranties, conditions and indemnification obligations of the parties.
The representations, warranties and covenants contained in such agreements were made only for purposes of such agreements and as of specific
dates, were solely for the benefit of the parties to such agreements and may be subject to limitations agreed upon by the contracting
parties.
The foregoing descriptions
of the Common Stock Purchase Agreement and the White Lion RRA are qualified in their entirety by reference to the full text of the Common
Stock Purchase Agreement and the White Lion RRA, copies of which are filed as Exhibits 10.1and 10.2, respectively, to this Current Report
on Form 8-K and incorporated herein by reference.