SecProbe.io

CORRESP
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filename1.htm

MATTHEW
OGURICK

Partner

DIRECT
TEL: 212-326-0243

FAX:
212-326-0806

mogurick@pryorcashman.com

July 1, 2024

Via
Edgar

Mr.
Michael Purcell

Ms.
Karina Dorin

Mr.
John Hodgin

Securities
and Exchange Commission

Division
of Corporate Finance

100
F Street, N.E.

Washington,
D.C. 20549

    Re:
    HNR ACQUISITION
    CORP

    Amendment
    No. 2 to Registration Statement on Form S-1

    Filed
    May 13, 2024

    File
    No. 333-275378

Lady
and Gentleman:

On
behalf of our client, HNR Acquisition Corp, a Delaware corporation (the “Company”), and pursuant to the applicable provisions
of the Securities Act of 1933, as amended (the “Securities Act”), and the rules promulgated thereunder, we hereby submit
in electronic form the accompanying Amendment No. 3 to the Registration Statement on Form S-1 of the Company (“Amendment No. 3”),
marked to indicate changes from the above-referenced Registration Statement on Form S-1 (as amended, the “Registration Statement”),
which was initially filed with the Securities and Exchange Commission (the “Commission”) on November 7, 2023.

Amendment
No. 3 reflects the responses of the Company to comments received from the Staff of the Commission (the “Staff”) in a letter
dated June 7, 2024 (the “Comment Letter”). In addition to addressing the comments received from the Staff, the Company has
also revised the Registration Statement in Amendment No. 3 to update other disclosures in the Registration Statement. The discussion
below is presented in the order of the numbered comments in the Comment Letter. Certain capitalized terms set forth in this letter are
used as defined in Amendment No. 3.

The
Company has asked us to convey the following responses to the Staff:

Amendment
No. 2 to Registration Statement on Form S-1

Risk
Factors

Risks
Related to Our Common Stock and this Offering

The
NYSE American may delist our securities from trading on its exchange, which could limit investors' ability to make transactions..., page
35

    1.
    We note you disclose
    on page F-32 that you did not timely file a Form 10-K for the fiscal year ended December 31, 2023 and received a notice from NYSE
    American that the Company is not in compliance with the NYSE American listing standards. Please update and revise your risk factor
    to state that you did not timely file the report and that you may not be able to file timely in the future, as well as any consequences
    of your inability to timely file.

    Response:
    In response to the Staff’s comment, the Company has updated the risk factor in the Registration
    Statement entitled “The NYSE American may delist our securities from trading on its exchange, which could limit investors’
    ability to make transactions in our securities and subject us to additional trading restrictions.” to include disclosure
    of the untimely filing, that future filings may not be timely, and potential consequences of such untimely filings.

Because
the currently outstanding shares of Class A Common Stock that are being registered for resale in this prospectus..., page 41

    2.
    We note your revised
    disclosure in response to prior comment 4 states that the pledge shares were issued as consideration to agree to an escrow and backstop
    agreement, and that the consultant shares were issued in consideration for services rendered. Please quantify the effective price
    of such shares at issuance. In addition, as requested in prior comment 4, please revise this risk factor to disclose the potential
    profit the selling securityholders will earn based on the current trading price.

    Response:
    In
    response to the Staff’s comment, the Company has revised the Registration Statement to quantify the effective price of the
    Pledge Shares and the Consultant Shares at issuance as $6.77 and $10.11 per share, respectively. The Company also revised the referenced
    risk factor to include the potential profit or loss based on current trading prices.

Business
of HNRA

Financing
at Closing, page 64

    3.
    We note it appears certain
    language included in the filing in response to prior comment 4 in our letter issued December 4, 2023 has been removed, including
    disclosures with respect to the purpose for entering into the forward purchase agreement and related subscription agreement and the
    inter-relationship between them. Please restore such disclosures.

    Response:

    In response to the Staff’s comment above,
    the Company has restored and expanded such disclosures based on recent developments, as follows:

    “The purpose of our entering into this
    agreement and these transactions was to provide a mechanism whereby FPA Seller would purchase, and waive their redemption rights with
    respect to, a sufficient number of shares of our common stock to enable us to have at least $5,000,000 of net tangible assets, a non-waivable
    condition to the Closing of the Purchase, to provide the Company with cash to meet a portion of the transaction costs associated with
    the Purchase, and to provide the Company with a mechanism to raise cash in the future at maturity. As of the date of this prospectus,
    however, the Company has not made any issuances, and has not received any proceeds, from Meteora pursuant to the Forward Purchase Agreement,
    and the Company is actively pursuing a mutual recission of the Forward Purchase Agreement.”

    4.
    We note your response
    to prior comment 12. Please provide us with a more detailed analysis of your compliance with Rule 14e-5 in connection with entering
    into the forward purchase agreement.

 Response: First, the Company respectfully advises the Staff that the
arrangement with Meteora under the Forward Purchase Agreement (the “FPA”) was not an arrangement for the Company to purchase
or arrange to purchase, directly or indirectly, Company shares. Second, the Company respectfully advises the Staff that Meteora is neither
a covered person pursuant to Rule 14-e5, nor an affiliate of either the Company or the Company’s Sponsor. For these
two reasons, the Company does not believe that Rule 14e-5 applies to Meteora’s potential purchases of Company shares pursuant to
the FPA.

The Company further respectfully
advises that certain shares that were, in fact, purchased by Meteora—namely (1) 50,070 Recycled Shares, and (2) 90,000 additional
shares, which were disclosed in the Company’s January 9, 2024 Amendment to the Resale S-1 (at pages 69 and 78 ), were purchased
by Meteora on the open market on or before October 10, 2023, before the redemption period opened on October 13, 2023. As such, these
share purchases are not subject to Rule 14e-5.1

While the Company maintains that the FPA is
not subject to Rule 14e-5, the Company has provided the analysis below to show its belief that the transaction complies with the conditions
of Tender Offer Compliance and Disclosure Interpretation 166.01 (March 22, 2022) (“C&DI 166.01”). In reaching this conclusion,
the Company has relied, in part, upon a Comment Response Letter submitted by Critical Metals Corp. (“Critical Metals”), File
333-268970, on December 7, 2023 (the “Critical Metals Response”), which similarly addressed an “Equity Forward Arrangement”
entered during a redemption period, and the Staff’s subsequent approval of Critical Metals’ Form F-4 on December 27, 2023.
Consistent with the presentation of the C&DI 166.01 analysis presented in the Critical Metals Response, for ease of reference, each
C&DI 166.01 element is provided in italics below, immediately followed by the Company’s analysis.

 1 Relatedly, the Company would like to take this opportunity
to correct an erroneous statement in our Comment Response Letter dated May 13, 2024, which stated on page 3, in response to Comment 7,
that the Recycled Shares and additional 90,000 shares were “purchased . . . on or around November 15, 2023.” The Company
believes that these shares were instead purchased by Meteora, on the open market, prior to October 10, 2023.

    2

Analysis Under Rule 14e-5 and C&DI 166.01

 ● “[T]he Securities Act registration
statement or proxy statement filed for the business combination transaction discloses the possibility that the SPAC sponsor or its affiliates
will purchase the SPAC securities outside the redemption process, along with the purpose of such purchases;”

 ○ The Company respectfully directs the Staff
to the disclosures of the FPA made in advance of the vote on the business combination transaction. The FPA, which was executed on November
2, 2023, was disclosed on page 2 of the Company’s November 3, 2023 Current Report on Form 8-K (the “FPA 8-K”), which
also attached the FPA as Exhibit 10.1, and the related FPA Funding Amount PIPE Subscription Agreement (the “Subscription Agreement”)
as Exhibit 10.2. The Company also refers the Staff to the Company’s November 7, 2023 Registration Statement on Form S-1 (the “Resale
S-1”), which reattached the FPA and Subscription Agreement as Exhibits 10.19 and 10.20, respectively.

 ● “[T]he SPAC sponsor or its affiliates
will purchase the SPAC securities at a price no higher than the price offered through the SPAC redemption process;”

 ○ The Company respectfully directs the Staff
to the disclosure in the FPA 8-K, Item 1.01, as well as the terms of the FPA and Subscription Agreement included as Exhibits 10.1 and
10.2 to the FPA 8-K, respectively, and Exhibits 10.19 and 10.20 to the Resale S-1, respectively. The Company further notes that the pricing
mechanism for Meteora’s purchase of shares under the FPA is in substantially the same form as the pricing mechanism set forth in
the Critical Metals Equity Forward Arrangement, as cited in the Critical Metals Response, for the purchase of shares by Vellar Opportunities
Fund Master, LTD. The Company has made no issuances of any equity securities to Meteora under the FPA, and Meteora was obligated to make
any such purchases at a price no higher than the redemption price, in order to “comply with the requirements of all [applicable]
tender offer regulations.” FPA 8-K, Ex. 10.01, Section 1(d). Finally, the Company is currently negotiating for the termination
or rescission of the FPA with Meteora, with no additional shares issued pursuant to the FPA, and will update the Registration Statement
to reflect all developments with respect to the FPA in future amendments.

 ● “[T]he Securities Act registration
statement or proxy statement filed for the business combination transaction includes a representation that any SPAC securities purchased
by the SPAC sponsor or its affiliates would not be voted in favor of approving the business combination transaction;”

 ○ The Company respectfully directs the Staff
to the disclosure on pages 21, 38, and 104 of the Company’s October 13, 2023 Definitive Proxy Statement on Schedule 14A (the “BC
Proxy”), as well as the sixth page of the introductory letter to shareholders and the second page of the notice to shareholders
included in the BC Proxy, which stated that only a holder as of the Company’s Record Date, October 10, 2023, could vote on the business
combination transaction. Because the Company’s Record Date was October 10, 2023, any shares that Meteora acquired after the Record
Date, including any share purchases that could have been made pursuant to the FPA, could not be voted in favor of approving the business
combination transaction pursuant to Delaware law. The Company has made no issuances of any equity securities to Meteora pursuant to the
FPA.

 ● “[T]he SPAC sponsor and its affiliates
do not possess any redemption rights with respect to the SPAC securities or, if they possess redemption rights, they waive such rights;”

 ○ The Company respectfully advises the Staff
that both Meteora and the Company’s Sponsor waived their redemption rights. The Company’s Sponsor’s waiver of redemption
rights was disclosed on pages 3, 22, 30, 40, 115, 130, 182, 183, 192, and F-8 of the BC Proxy, as well as the sixth page of the introductory
letter to shareholders and the second page of the notice to shareholders included in the BC Proxy. Meteora had no redemption rights
in connection with any share purchases under the FPA. There have been no such purchases and, had any such purchases occurred, they would
have been after the closing of the redemption period.

    3

 ● “[And] the SPAC discloses in a Form
8-K, prior to the security holder meeting to approve the business combination transaction, the following:

 ○ [T]he amount of SPAC securities purchased
outside of the redemption offer by the SPAC sponsor or its affiliates, along with the purchase price;”

 ■ The Company respectfully advises the Staff
that, as described in the FPA 8-K, Item 1.01, the FPA provided that Meteora could, “but [was] not obligated, to purchase up to 3,000,000
shares . . . concurrently with the closing of the” business combination. Meteora did not purchase any shares pursuant to the FPA
while the redemption period was open, and therefore there were no such purchases to disclose prior to the security holder meeting. FPA
8-K, Item 1.01, and Exhibits 10.1 and 10.2 also disclosed the pricing mechanism for Meteora’s potential share purchases under the
FPA.

 ○ “[T]he purpose of the purchases by
the SPAC sponsor or its affiliates;”

 ■ The Company respectfully directs the Staff
to the disclosures of the FPA, on pages 1-2 of the FPA 8-K, which also attached the FPA as Exhibit 10.1, and the related Subscription
Agreement as Exhibit 10.2. The Company also disclosed the purpose of the FPA in its January 9, 2024 Amendment to the Resale S-1 (at page
99).

 ○ “[T]he impact, if any, of the purchases
by the SPAC sponsor or its affiliates on the likelihood that the business combination transaction will be approved;”

 ■ The Company respectfully advises the Staff
that because Meteora could not purchase any shares pursuant to the FPA while the redemption period was open, the potential purchases pursuant
to the FPA had no impact on the likelihood that the business combination transaction would be approved.

 ○ “[T]he identities of SPAC security
holders who sold to the SPAC sponsor or its affiliates (if not purchased on the open market) or the nature of SPAC security holders (e.g.,
5% security holders) who sold to the SPAC sponsor or its affiliates;”

 ■ The Company respectfully advises the Staff
that there were no security holders who sold to Meteora pursuant to the FPA.

 ○ “[A]nd the number of SPAC securities
for which the SPAC has received redemption requests pursuant to its redemption offer.”

 ■ The Company respectfully directs the Staff
to the disclosure on page 3 of the FPA 8-K, as well as the disclosure on page 2 of the Company’s November 13, 2023 Current Report
on Form 8-K following the vote on the Company’s business combination transaction.

Finally, the Company
respectfully notes that the FPA sets forth representations, warranties and covenants that the FPA “has been structured, and
all activity in connection with the [FPA] has been undertaken to comply with the requirements of all [applicable] tender offer
regulations,” and that the Company will comply with C&DI 166.01 for all relevant disclosure. FPA 8-K, Ex. 10.01, Sections
1(d), 2(f).

    4

Pogo
Internal Controls, page 72

    5.
    Please expand the discussion
    of the internal controls used by the Company in its reserves estimation effort to provide the qualifications of the technical person
    primarily responsible for overseeing the preparation of the reserves estimates presented in the filing. Refer to the requirements
    in Item 1202(a)(7) of Regulation S-K.

    Response:
    In response to the Staff’s
    comment, the Company has revised the section entitled “Pogo Internal Controls” to identify the Company’s VP of
    Operations as the technical person primarily responsible for overseeing the preparation of the reserves estimates presented in the
    filing a