EON Resources announces agreement with Pogo Royalty

EON Resources (EONR) has entered into an agreement with Pogo Royaltythat would result in a restructure of EON’s balance sheet through the retirement of a promissory note to Seller having an original principal amount of $15,000,000, the purchase of a 10% Overriding Royalty Interest in the Company’s oil field property from Seller and the repurchase of 100% of preferred units held by Seller in EON’s subsidiary which would otherwise convert into the Company’s Class A common stock on November 15, 2025 pursuant to a formula. The total consideration payable to Pogo in connection with the restructuring consists of $22,000,000 in cash from EON plus the issuance of 3,000,000 shares of the Company’s Class A common stock to the Seller. The agreement is subject to various closing conditions, including, without limitation, that the Company obtain adequate financing to fund the cash consideration portion, and that the agreement shall terminate if the closing does not take place within 120 days. The agreement also contains mutual general releases, which shall be effective upon the closing of the agreement. The effect on the Company’s balance sheet and financial position exclusive of the final financing arrangements the secure the $22 million in cash consideration is anticipated to include the following: A reduction of liabilities comprised of principal and accrued interest debt owing to Seller of approximately $18,000,000 Reduction of $24,000,000 of redemption value of the currently outstanding preferred units held by Seller. The ORRI which is valued at $14 million and is presently generating approximately $200,000 per month in proceeds. The elimination of outstanding shares of the Company’s Class B common stock.