Item 1.01 Entry into A Material Definitive Agreement.





Merger Agreement

On April 26, 2022, Fortune Rise Acquisition Corporation ("FRLA" or the "Parent"), Sigma Merger Sub Inc., a Delaware corporation and direct, wholly owned subsidiary of FRLA ("Sigma Merger Sub"), Gamma Merger Sub Inc., a Delaware corporation and direct, wholly owned subsidiary of FRLA ("Gamma Merger Sub" and, together with Sigma Merger Sub, "Merger Subs" and each, a "Merger Sub"), VCV Power Sigma, Inc., a Delaware corporation ("Sigma"), and VCV Power Gamma, Inc., a Delaware corporation ("Gamma" and, together with Sigma, the "Companies" and each individually, a "Company"), and Yuan (Jerry) Tang ("Jerry Tang"), in his capacity as the representative for stockholders of both Companies and for certain limited purposes under Section 5.13 thereunder, entered into an Agreement and Plan of Merger (the "Merger Agreement"). Capitalized terms used and not otherwise defined herein have the definitions assigned to such terms in the Merger Agreement.

Pursuant to the Merger Agreement, among other things, (i) in accordance with the General Corporation Law of the State of Delaware, as amended (the "DGCL"), Sigma Merger Sub will merge with and into Sigma (the "Sigma Merger"), with Sigma surviving the Sigma Merger as a wholly owned subsidiary of FRLA ("Surviving Sigma"), and (ii) in accordance with the DGCL, Gamma Merger Sub will merge with and into Gamma (the "Gamma Merger" and, together with the Sigma Merger, the "Mergers"), with Gamma surviving the Gamma Merger as a wholly owned subsidiary of FRLA ("Surviving Gamma" and, together with Surviving Sigma, the "Surviving Companies" and each, a "Surviving Company"). The Mergers will become effective at such time on the date of the closing of the Mergers (the "Closing") as the certificates of merger are duly filed with the Secretary of State of the State of Delaware or at such other time specified in the certificates of merger (the "Effective Time"). Effective from the Closing, the Parent will change its name to "VCV Digital Technology, Inc."





Closing Merger Consideration

Pursuant to the Merger Agreement, as consideration for their shares of Class A common stock, par value $0.0001 per share, or Class B common stock, par value $0.0001 per share, of Sigma (collectively, "Sigma Common Stock"), stockholders of Sigma will receive an aggregate number of newly issued shares of Class A common stock of the Parent, par value $0.0001 per share (the "Parent Common Shares"), equal to the quotient obtained by dividing $50,000,000 by the per share redemption price at the Closing (the "Closing Price") provided for in the Parent's governing documents (the "Sigma Merger Consideration Shares"). Each share of Sigma Common Stock (other than shares held immediately prior to the Effective Time by Sigma or the Parent ("Sigma Excluded Shares") and shares as to which appraisal rights have been properly exercised in accordance with Delaware law ("Sigma Dissenting Shares")) will be automatically converted into the right to receive a number of Parent Common Shares equal to the quotient obtained by dividing the Sigma Merger Consideration Shares by the number of shares of Sigma Common Stock (including restricted stock and Sigma Dissenting Shares but excluding Sigma Excluded Shares) outstanding as of immediately prior to the Effective Time (the "Sigma Exchange Ratio").

As consideration for their shares of Class A common stock, par value $0.0001 per share, or Class B common stock, par value $0.0001 per share of Gamma (collectively, "Gamma Common Stock"), stockholders of Gamma will receive an aggregate number of newly issued Parent Common Shares equal to the quotient obtained by dividing $200,000,000 by the Closing Price (the "Gamma Merger Consideration Shares" and, together with the Sigma Merger Consideration Shares, the "Closing Merger Consideration Shares"). Each share of Gamma Common Stock (other than shares held immediately prior to the Effective Time by Gamma or the Parent ("Gamma Excluded Shares") and shares as to which appraisal rights have been properly exercised in accordance with Delaware law ("Gamma Dissenting Shares")) will be automatically converted into the right to receive a number of Parent Common Shares equal to the quotient obtained by dividing the Gamma Merger Consideration Shares by the number of shares of Gamma Common Stock (including restricted stock and Gamma Dissenting Shares but excluding Gamma Excluded Shares) outstanding as of immediately prior to the Effective Time (the "Gamma Exchange Ratio").

Earnout Consideration and Earnout Escrow Account

In addition to the Gamma Merger Consideration Shares, Gamma stockholders will be eligible to receive earnout consideration of up to an aggregate number of newly issued Parent Common Shares equal to the quotient obtained by dividing $100,000,000 by the Closing Price (the "Gamma Earnout Consideration Shares"). At the Closing, FRLA shall deposit with Vstock Transfer LLC, as the escrow agent (the "Escrow Agent") the Gamma Earnout Consideration Shares, less any portion of the Gamma Earnout Consideration Shares that has become vested and deliverable to Gamma stockholders prior to the Closing, in a segregated escrow account (the "Earnout Escrow Account"). As provided in the Merger Agreement, during the period beginning on the date of the Merger Agreement and ending on April 30, 2023, each one fourth of the Gamma Earnout Consideration Shares will be disbursed from the Earnout Escrow Account and delivered to Gamma stockholders upon the achievement of the following events (the "Triggering Events"):

a) Deployment of 4,500 aggregate miners by the Companies, the Surviving


    Companies, the Parent or any subsidiaries of any of the foregoing, including
    by means of a merger or asset acquisition, as reflected in the applicable
    mining pool monitor; and

b) Each additional deployment of 2,000 miners (up to a maximum of 6,000

additional miners) by the Companies, the Surviving Companies, the Parent or

any subsidiaries of any of the foregoing, including by means of a merger or

asset acquisition, as reflected in the applicable mining pool monitor.

If any of the Triggering Events has been achieved prior to Closing, the applicable portion of the Gamma Earnout Consideration Shares shall become vested and deliverable to Gamma stockholders at the Closing. If any of the Triggering Events has not been achieved by April 30, 2023, the applicable portion of the Gamma Earnout Consideration Shares shall be forfeited pursuant to the Merger Agreement and the Escrow Agreement.





Treatment of Equity Awards

With respect to equity awards, at the Effective Time:

· (i) each outstanding share of Sigma Common Stock granted under the VCV Power

Sigma, Inc. 2022 Stock Plan that is subject to service-based vesting,
   repurchase or other lapse condition (the "Sigma Restricted Stock") will be
   automatically converted into the right to receive a number of Parent Common
   Shares (the "Assumed Sigma Restricted Stock") equal to the Sigma Exchange
   Ratio, with such Parent Common Shares subject to the same terms and conditions
   as were applicable to such Sigma Restricted Stock immediately prior to the
   Effective Time, and (ii) each outstanding share of Gamma Common Stock granted
   under the VCV Power Gamma, Inc. 2022 Stock Plan that is subject to
   service-based vesting, repurchase or other lapse condition (the "Gamma
   Restricted Stock" and, together with Sigma Restricted Stock, the "Company
   Restricted Stock") will be automatically converted into the right to receive
   (A) a number of Parent Common Shares equal to the Gamma Exchange Ratio, and (B)
   a number of Parent Common Shares equal to the Gamma Earnout Exchange Ratio
   (together with the Assumed Sigma Restricted Stock, the "Assumed Restricted
   Stock"), with such Parent Common Shares referenced in each of clauses (A) and
   (B) subject to the same terms and conditions as were applicable to such Gamma
   Restricted Stock immediately prior to the Effective Time;

· (i) each outstanding option to purchase Sigma Common Stock (each, a "Sigma


   Option"), whether vested or unvested, shall be assumed by the Parent and
   automatically convert into an option (each, an "Assumed Sigma Option") to
   purchase applicable number of Parent Common Shares at an exercise price
   adjusted as set forth in the Merger Agreement; and (ii) each outstanding option
   to purchase Gamma Common Stock (together with any Sigma Option, collectively,
   the "Company Options"), whether vested or unvested, shall be assumed by the
   Parent and automatically convert into an option (each, an "Assumed Gamma
   Option" and, together with any Assumed Sigma Option, each, an "Assumed Option"
   and collectively, "Assumed Options") to purchase the applicable number of
   Parent Common Shares at an exercise price adjusted as set forth in the Merger
   Agreement; and

· (i) each note issued by Sigma that is convertible into shares of Sigma Common

Stock (each, a "Sigma Convertible Note") that is outstanding immediately prior

to the Effective Time shall be assumed by the Parent and remain outstanding and

convertible into the applicable number of Parent Common Shares, and (ii) each

note issued by Gamma that is convertible into shares of Gamma Common Stock

(each, a "Gamma Convertible Note") that is outstanding immediately prior to the

Effective Time shall be assumed by the Parent and remain outstanding and

convertible into applicable number of Parent Common Shares under the same

conversion schedule as applicable to such note. . . .

Item 7.01 Regulation FD Disclosure.

On May 2, 2022, FRLA and the Companies issued a joint press release announcing the execution of the Merger Agreement, a copy of which is furnished as Exhibit 99.1 to this Report.

Furnished as Exhibit 99.2 hereto is the investor presentation prepared for use in connection with the announcement of the Mergers.

The information in this Item 7.01, including Exhibits 99.1 and 99.2, is being furnished pursuant to Item 7.01 and shall not be deemed to be "filed" for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise be subject to the liabilities of that section, nor shall it be deemed to be incorporated by reference in any filing under the Securities Act or the Exchange Act. This Report should not be deemed an admission as to the materiality of any information contained in the investor presentation. The Company does not undertake any obligation to update the investor presentation.

Item 9.01 Financial Statements and Exhibits.





(d) Exhibits



Number     Description

  2.1*       Agreement and Plan of Merger, dated as of April 26, 2022, by and among
           Fortune Rise Acquisition Corporation, Sigma Merger Sub Inc., Gamma Merger
           Sub Inc., VCV Power Sigma, Inc., VCV Power Gamma, Inc., and Yuan (Jerry)
           Tang.

  10.1       Voting Agreement, dated as of April 26, 2022, by and among Fortune Rise
           Acquisition Corporation, VCV Power Sigma, Inc., VCV Power Gamma, Inc. and
           certain initial stockholders of Fortune Rise Acquisition Corporation.

  10.2       Voting Agreement, dated as of April 26, 2022, by and among Fortune Rise
           Acquisition Corporation, VCV Power Sigma, Inc., VCV Power Gamma, Inc. and
           certain stockholders of VCV Power Sigma, Inc. and VCV Power Gamma, Inc.

  99.1       Press Release dated May 2, 2022.

  99.2       Investor Presentation.

* The schedules to this Exhibit have been omitted in accordance with Regulation S-K Item 601(b)(2). The registrant agrees to furnish supplementally a copy of any omitted schedule to the Securities and Exchange Commission upon its request.

© Edgar Online, source Glimpses