Exhibit 10.2


 


FORM OF PROMISSORY NOTE


 


	HNR ACQUISITION CORP	[●]% Promissory Note



 


THIS PROMISSORY NOTE AND ANY SECURITIES ISSUABLE
RELATED TO THIS PROMISSORY NOTE HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, AND MAY NOT BE TRANSFERRED OR OTHERWISE
DISPOSED OF UNLESS THEY HAVE BEEN REGISTERED UNDER SUCH ACT OR PURSUANT TO AN EXEMPTION FROM REGISTRATION UNDER SUCH ACT.


 


This unsecured, subordinated Note is being delivered
pursuant to that certain Membership Interest Purchase Agreement dated as of December 26, 2022 (the “Purchase Agreement”),
by and among CIC Pogo LP, a Delaware limited partnership, DenCo Resources, LLC, a Texas limited liability company, 4400 Holdings, LLC,
a Texas limited liability company, Pogo Resources Management, LLC, a Texas limited liability company (CIC Pogo LP, DenCo Resources, LLC,
4400 Holdings, LLC, and Pogo Resources Management, LLC collectively, “Holder”) and HNR Acquisition Corp., a Delaware
corporation (the “Company”), pursuant to which the Company has agreed to acquire 100% of the outstanding equity interests
of Pogo Resources, LLC (“Pogo”). All capitalized terms used but not otherwise defined herein shall have the meaning
ascribed to such terms in the Purchase Agreement.


 


FOR VALUE RECEIVED, the Company
hereby promises to pay to Holder, an amount (“Principal”) equal to $___________1,
providing for a maturity date of _______________, 20232 (“Maturity
Date”), bearing an interest rate equal to [●]%3
per annum (“Interest”), and with no penalty for prepayment.


 


1. Payment Terms.


 


(a) Payment. Payment of the Principal
and any accrued Interest (including Default Interest) shall be made on the Maturity Date by certified or bank cashier's check payable
to the Holder, or by bank wire transfer, in immediately available funds, to the account so specified, in lawful money of the United States
of America. If the Maturity Date occurs on a date that is not a Business Day then the Principal or Interest (including Default Interest,
if applicable) then due shall be paid on the next succeeding Business Day. “Business Day” shall mean any day other
than Saturday, Sunday or any day upon which banks in Dallas, Texas are authorized or required to be closed.


 


(b) Prepayment. The Company may
prepay this Note at any time, without premium or penalty, in whole or in part, with accrued Interest to the date of such payment on the
amount prepaid.


 


(c) Interest. Interest shall
be paid to the Holder in cash, on or prior to the Maturity Date. Any Default Interest shall be paid to the Holder in cash promptly.


 





 






		1	Principal amount to be the lesser of (i) the difference between
$100,000,000 and the Minimum Cash Amount and (ii) $15,000,000.



		2	Maturity Date to be six (6) months from Closing Date (as defined
in the Purchase Agreement).
		3	Interest rate to be greater of 12% per annum and the highest
interest rate applicable to the Cash Facilities (as defined in the Purchase Agreement).



 






     


     


    

 


2. Default and Remedies.


 


(a) If any of the following events or conditions
(each an “Event of Default”) shall occur and be continuing:


 


(i) The Company shall fail to pay the
Principal and any Interest due (or any lesser amount due) on the Maturity Date;


 


(ii) an involuntary proceeding shall
be commenced or an involuntary petition shall be filed in a court of competent jurisdiction seeking (A) relief in respect of the Company,
or of a substantial part of the property or assets of the Company, under Title 11 of the United States Code, as now constituted or hereafter
amended, or any successor to or replacement of such statute, or any other Federal or state bankruptcy, insolvency, receivership or similar
law, (B) the appointment of a receiver, trustee, custodian, sequestrator, conservator or similar official for the Company or for a substantial
part of the properties or assets of the Company or (C) the winding-up, liquidation or dissolution of the Company; and such proceeding
or petition shall continue undismissed for 90 days or an order or decree approving or ordering any of the foregoing shall be entered;
or


 


(iii) the Company (A) voluntarily commences
any proceeding or files any petition seeking relief under Title 11 of the United States Code, as now constituted or hereafter amended,
or any successor to or replacement of such statute, or any other Federal or state bankruptcy, insolvency, receivership or similar law,
(B) consents to, or fails to contest in a timely and appropriate manner, the commencement against of any proceeding or the filing of any
petition described in clause (v) above, (C) applies for or consents to the appointment of a receiver, trustee, custodian, sequestrator,
conservator or similar official for the Company or for a substantial part of the properties or assets of the Company, (D) files an answer
admitting the material allegations of a petition filed against it in any such proceeding, (E) makes a general assignment for the benefit
of creditors, (F) becomes unable, admits in writing its inability or fails generally to pay its debts as they become due or (G) takes
any action for the purpose of effecting any of the foregoing; then, (x) in the case of an Event of Default specified in clause (a)(i),
(ii), or (iii) above, the Holder may, at any time during the continuance of such Event of Default, by written notice to the Company, declare
the entire outstanding Principal, together with all accrued and unpaid Interest, to be due and payable and (y) in the case of an Event
of Default specified in clauses (a)(iv) or (v) above, the entire outstanding Principal, together with all accrued and unpaid Interest,
shall automatically forthwith become due and payable without presentment, protest or notice of any kind, all of which are hereby expressly
waived by the Company.


 


(iv) The Company shall fail to pay Interest
when due.


 


(v) The Company shall fail to comply
with any covenant or obligation set forth in this Note, including the covenants set forth in Section 4 hereof.


 


(vi) Any other default or event of default
under the [Cash Facilities]4.


 





 






		4	Note to Draft: [Cash Facilities] to be replaced with reference
to specific credit agreement upon finalization thereof



 






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(b) Subject to the other terms of this Note, if
an Event of Default occurs and is continuing, the Holder may pursue any available remedy to collect the payment of the Principal or Interest
or to enforce the performance of any provision of this Note. If an Event of Default occurs and is continuing, the Holder may proceed to
protect and enforce its rights by any action at law, suit in equity or other appropriate proceeding. In the case of a default in the payment
of the Principal or Interest, and in addition to any Default Interest that shall accrue and become payable, the Company will pay to the
Holder such further amount as shall be sufficient to cover the costs and expenses of collection, including, without limitation, reasonable
attorneys' fees, expenses and disbursements.


 


(c) Default Interest. If an Event of Default
occurs, all outstanding amounts of Principal and Interest shall thereafter bear interest at the lesser of 18% per annum and the highest
amount permissible under applicable Law (“Default Interest”) per annum and compounded monthly; provided, that such
Default Interest shall apply retroactive to the date of this Note for all amounts outstanding.


 


3. Representations and Warranties.


 


The Company hereby represents and warrants to
the Holder that on and as of the date hereof:


 


(a) the
Company is duly organized, validly existing and in good standing under the laws of the State of Delaware;


 


(b) the
Company is duly authorized to execute and deliver this Note and to perform its obligations under this Note.  The execution and delivery
of this Note, and the performance by the Company of its obligations hereunder, (i) have been duly authorized by all necessary corporate
action on the part of the Company, (ii) do not conflict with or violate any provisions of the Company’s Charter Documents,
(iii) do not violate or cause a default under any applicable Law; and (iv) do not result in a violation of, or a default under, or
give rise to a right for any third-party to terminate any material Contract to which the Company is party or by which it or its assets
are bound, including the [Cash Facilities], except in the case of clauses (iii) and (iv) as would not reasonably be expected to have a
material adverse effect on the business, property, operations or financial condition of the Company and its Subsidiaries, taken as a whole,
or the validity or enforceability of this Note or the rights and remedies of the Holder hereunder (including the right of timely repayment
of all Principal and Interest) (a “Material Adverse Effect”);


 


(c) this
Note is a legal, valid and binding obligation of the Company, enforceable against the Company in accordance with its terms, except as
enforceability may be limited by bankruptcy, insolvency, fraudulent conveyance, reorganization or similar laws relating to or affecting
creditors’ rights generally and general principles of equity (whether considered in a proceeding in equity or law);


 


(d) except
for such filings or other actions that have been made or taken on or prior to the date hereof and such filings or other actions the failure
of which to be obtained or made would not reasonably be expected to have a Material Adverse Effect, no consent, approval, authorization
or other action by, or filing with or notification to, any Person or any Governmental Authority on the part of the Company is required
in connection with the execution, delivery and performance by the Company of this Note;


 


(e) there
is no Proceeding pending or, to the knowledge of the Company, threatened in writing against the Company, which, if determined adversely,
would reasonably be expected to have a Material Adverse Effect; and


 


(f) there
is no Order outstanding against the Company that would reasonably be expected to have a Material Adverse Effect.


 






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4.  Certain Covenants.


 


(a) Until the obligations
under this Note are repaid in full (including all Principal, Interest and Default Interest), the Company shall conduct the business of
Pogo and its Subsidiaries in the ordinary course, consistent with past practice during the nine (9) months prior to the closing the transactions
contemplated by the Purchase Agreement (including by maintaining levels of compensation to employees that are no more than such expenses
and costs incurred by Pogo and its subsidiaries for compensation to employees during the nine (9) months prior to the closing of the transactions
contemplated by the Purchase Agreement, except that the Company may pay its executives that compensation which has been approved by the
Company’s compensation committee, with the advice of an independent compensation consultant, not to exceed $700,000 annually (which,
for the avoidance of doubt, shall exclude compensation payable as deferred compensation after full satisfaction of this Note). .


 


(b)  Without limiting the
foregoing, unless otherwise consented to in writing by each Holder, so long as the obligations under this Note are outstanding, the Company
shall not (i) transfer, sell, hypothecate, encumber, dispose of any material assets of Pogo or its Subsidiaries unless, following such
transfer or sale of assets the proceeds received by the Company or Pogo are used to repay 100% of the obligations owed under this Note
or (ii) acquire any material assets outside of the ordinary course of business.


 


(c) Until the obligations
under this Note are repaid in full (including all Principal, Interest and Default Interest), and subject to Section 4(a) above, any proceeds
raised by the Company, Pogo or any of their Subsidiaries in connection with the issuance of any equity or debt securities shall be used
to repay (whether full or in part) the accrued and outstanding obligations under this Note.


 


5. Notices.


 


All notices, instructions and other communications given hereunder
or in connection herewith shall be in writing. Any such notice, instruction or communication shall be sent to:


 


If to the Company to:  


 


HNR Acquisition Corp


3730 Kirby Drive, Suite 1200


Houston, Texas 77098


Attention: President


Email: Donald.Orr@HNRA-NYSE.com


 


with a copy to (not constituting notice):


 


David M. Smith, General Counsel


HNR Acquisition Corp.


10142 Holly Chase Dr.


Houston, Texas 77042


Email: dmsmith@HNRA-NYSE.com


 


If to the Holder to:  


 


3879 Maple Avenue


Suite 400


Dallas, TX 75219


 






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6. Governing Law; Jurisdiction.


 


This Note shall be construed and enforced in accordance
with the laws of the State of Texas, without regard to its conflicts of laws rules. The Company hereby irrevocably and unconditionally
submits, for itself and its property, to the non-exclusive jurisdiction of the courts of the State of Texas and of the United States federal
courts located within Dallas County, Texas, and any appellate court of such courts, in any action or proceeding arising out of or relating
to this Note, or for recognition or enforcement of any judgment, and the Company hereby irrevocably and unconditionally agrees that all
claims in respect of any such action or proceeding may be heard and determined in such Texas court (or, to the extent permitted by law,
in such federal court). The Company agrees that a final, unappealable judgment in any such action or proceeding shall be conclusive and
may be enforced in other jurisdictions by suit on the judgment or in any other manner provided by law. Nothing in this Note shall affect
any right that the Holder may otherwise have to bring any action or proceeding relating to this Note against the Company or its properties
in the courts of any jurisdiction.


 


7. Waiver of Presentment.


 


Except as otherwise expressly provided in this
Note, the Company waives presentment for payment, demand, notice of nonpayment, diligence, notice of acceptance, notice of dishonor, demand
for payment, protest of any dishonor, notice of protest, and protest of this Note and all other notices of any kind in connection with
the delivery, acceptance, performance, default, or enforcement of the payment of this Note.


 


8. Severability.


 


In the event that any one or more of the provisions
contained herein, or the application thereof in any circumstances, is held invalid, illegal or unenforceable in any respect for any reason,
the Company and the Holder shall negotiate in good faith with a view to the substitution therefor of a suitable and equitable solution
in order to carry out, so far as may be valid and enforceable, the intent and purpose of such invalid provision, provided, that the validity,
legality and enforceability of any such provision in every other respect and of the remaining provisions contained herein shall not be
in any way impaired thereby, it being intended that all of the rights and privileges of the parties hereto shall be enforceable to the
fullest extent permitted by Law.


 


9. Amendments.


 


This Note may not be changed, amended or modified
except by agreement in writing signed by the Company and the Holder.


 


10. Entire Agreement.


 


This Note, together with the Purchase Agreement
and the other documents and agreements delivered at the closing pursuant to the express provisions of the Purchase Agreement, constitute
the full and entire understanding and agreement of the Company and the Holder hereto in respect of its subject matter, and supersedes
all prior agreements, understandings (oral and written) and negotiations between or among the Company or the Holder with regard to such
subject matter.


 






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IN WITNESS WHEREOF, the Company has caused
this Note to be signed on its behalf, in its corporate name, by its duly authorized officer as an instrument under seal, as of [●],
2023.


 


HNR ACQUISITION CORP


 


	By:	 	 
	 	Donald W. Orr, President	 



 


 


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