As Of               Filer                 Filing    For·On·As Docs:Size             Issuer                      Filing Agent

 2/14/24  Fortune Rise Acquisition Corp.    S-4                   11:4.7M                                   Southridge Svcs Inc./FA

Document/Exhibit                   Description                      Pages   Size 

 1: S-4         Fortune Rise Acquisition Corporation - Form S-4     HTML   4.28M 
 3: EX-23.1     Consent of Marcum LLP                               HTML      7K 
 4: EX-23.2     Consent of Friedman LLP                             HTML      6K 
 5: EX-23.3     Consent of M&K CPAs, Pllc                           HTML      7K 
 6: EX-23.4     Consent of the Benchmark Company, LLC.              HTML      9K 
 2: EX-FILING FEES  Filing Fee Table                                HTML     23K 
 7: EX-99.3     Consent of T. Riggs Eckelberry to Be Named as A     HTML      7K 
                Director Nominee.                                                
 8: EX-99.4     Consent of Stephen Hall to Be Named as A Director   HTML      7K 
                Nominee.                                                         
 9: EX-99.5     Consent of Leslie Brock to Be Named as A Director   HTML      7K 
                Nominee.                                                         
10: EX-99.6     Consent of Taron Lexton to Be Named as A Director   HTML      7K 
                Nominee.                                                         
11: EX-99.7     Consent of Jean-Louis Kindler to Be Named as A      HTML      7K 
                Director Nominee.                                                

The information in this preliminary proxy statement/prospectus/consent solicitation statement is not complete and may be changed. The securities described herein may not be sold until the registration statement filed with the U.S. Securities and Exchange Commission is declared effective. This preliminary proxy statement/prospectus/consent solicitation statement is not an offer to sell these securities and it is not soliciting an offer to buy these securities in any jurisdiction where the offer or sale is not permitted.

PRELIMINARY PROXY STATEMENT/PROSPECTUS/CONSENT SOLICITATION STATEMENT

SUBJECT TO COMPLETION, DATED [●], 2024

 

PROPOSED MERGER

YOUR VOTE IS VERY IMPORTANT

On October 24, 2023, Fortune Rise Acquisition Corporation, a Delaware corporation (“FRLA”) and Water on Demand, Inc., a Texas corporation (“WODI”) entered into a Business Combination Agreement (as amended February 6, 2024, the “Business Combination Agreement”), pursuant to which FRLA Merger Sub, Inc., a Delaware corporation and wholly owned subsidiary of FRLA (“Merger Sub”) will merge with and into WODI (the “Merger”), with WODI as the surviving corporation in the Merger and, after giving effect to the Merger, WODI will be a wholly-owned subsidiary of FRLA (the “Combined Company”). The Combined Company will change its name to “Water on Demand, Inc.” The Merger and the other transactions contemplated by the Business Combination Agreement are hereinafter referred to as the “Business Combination.”

Pursuant to the Business Combination Agreement, at the Effective Time, (A) each share of FRLA Class A common stock, par value $0.0001 per share (“FRLA Class A Common Stock”) and each share of FRLA Class B common stock, par value $0.0001 per share (“FRLA Class B Common Stock”) (other than such shares of FRLA Class B Common Stock held by Fortune Rise Sponsor, LLC, a Delaware limited liability company (the “Sponsor”) which were forfeited pursuant to the Sponsor Letter Agreement (as defined below)) that is issued and outstanding immediately prior to the Merger shall become one share of FRLA common stock, par value $0.0001 per share (“Common Stock”), (B) each share of capital stock of Merger Sub issued and outstanding immediately prior to the Effective Time will be automatically cancelled and extinguished and converted into one share of common stock, par value $0.0001, of WODI (“WODI Common Stock”); (C) each share of WODI preferred stock (“WODI Preferred Stock”) shall convert to WODI Common Stock in accordance with the terms thereof immediately prior to the Effective Time; (D) each share of WODI Common Stock (other than the WODI Common Stock held as treasury stock by WODI) issued and outstanding as of immediately prior to the Effective Time shall be automatically canceled and extinguished and converted into the right to receive that number shares of Common Stock equal to the Merger Consideration (as defined below); (E) any shares of WODI Common Stock that are restricted or subject to vesting shall automatically vest and be converted into shares of Common Stock granted as part of the Merger Consideration; (F) certain convertible promissory notes issued by WODI shall convert into shares of WODI Common Stock; and (G) each share of WODI Common Stock held by WODI as treasury stock immediately prior to the Effective Time will be automatically canceled and extinguished, and no consideration shall be paid with respect thereto.

WODI shareholders shall be entitled to, with respect to each outstanding share of WODI Common Stock, a number of shares of Common Stock, equal to the Exchange Ratio (the “Merger Consideration,” and the shares of Common Stock issued as Merger Consideration, the “Merger Consideration Shares”), where the Exchange Ratio is equal to the quotient of (A) (i) $32,000,000, divided by (ii) the sum of the aggregate number of shares of WODI Common Stock outstanding immediately prior to the Effective Time and the number of restricted stock grants subject to vesting, and (B) (i) the aggregate amount of cash on deposit in the Trust Account (without giving effect to the redemption of any shares by FRLA’s public stockholders) as of two business days prior to the Closing Date, including interest not previously released to FRLA to pay taxes of FRLA divided by (ii) the total number of then issued and

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outstanding shares of FRLA Class A Common Stock (without giving effect to the redemption of any shares by FRLA’s public stockholders).

Concurrently with the execution of the Business Combination Agreement, the Sponsor, FRLA and WODI entered into a Letter Agreement (the “Sponsor Letter Agreement”), pursuant to which, among other things, the Sponsor agreed to (a) vote in favor of the Business Combination Agreement and the transactions contemplated thereby, (b) accept or alternatively waive any adjustment to the conversion ratio set forth in the Certificate of Incorporation or other governing documents of FRLA and/or any other anti-dilution or similar protection with respect to the FRLA Class B Common Stock, such that the FRLA Class B Common Stock will convert into Common Stock at the Closing on a one-to-one basis, and (c) subject to potential forfeiture certain of the FRLA Class B Common Stock currently held by the Sponsor and certain FRLA Class A Common Stock issuable to the Sponsor on exercise of a warrant owned by the Sponsor, in each case, on the terms and subject to the conditions set forth in the Sponsor Letter Agreement.

FRLA will hold a special meeting of its stockholders in connection with the proposed Business Combination which is referred to as the “FRLA Special Meeting.” WODI will similarly seek the approval of its shareholders of the Business Combination by written consent which is referred to as the “WODI Shareholder Consent.”

WODI designs and manufactures a complete line of water treatment systems for municipal, industrial and pure water applications and is rolling out a unique “pay-as-you-go” financing program to support such services. WODI utilizes a wide range of technologies, including chemical injection, media filters, membrane, ion exchange and SCADA (supervisory control and data acquisition) technology in turnkey systems. The WODI board of directors unanimously recommends that WODI shareholders approve the proposals set forth in the WODI Shareholder Consent.

FRLA is a Delaware blank check company established for the purpose of entering into a merger, share exchange, asset acquisition, stock purchase, recapitalization, reorganization or other similar business transaction with one or more businesses or entities, which we refer to as a “target business.” The FRLA board of directors unanimously recommends that FRLA stockholders vote “FOR” each of the proposals to be considered at the FRLA Special Meeting.

Presuming no redemptions by the FRLA shareholders, it is anticipated that upon completion of the Business Combination, FRLA’s public stockholders would retain an ownership interest of approximately 38.1% of the Combined Company, the Sponsor and directors of FRLA will retain an ownership interest of approximately 17.7% of the Combined Company, the Representatives will retain an ownership interest of approximately 1.4% of the Combined Company, and the WODI shareholders will own approximately 42.8% of the Combined Company. The ownership and voting power percentages with respect to the Combined Company (a) does not take into account (i) the redemption of any shares by FRLA’s public stockholders, (ii) the issuance of any additional shares upon the Closing under the Incentive Plan, (iii) the potential issuance of additional shares underlying equity-linked FRLA securities (such as warrants), or (iv) the potential issuance of additional shares underlying equity-linked WODI securities (such as warrants, RSUs, stock options and any other equity-linked securities that may be issued by WODI prior to the Closing) that are to be converted, at the Closing, into equity-linked FRLA securities. If the actual facts are different from these assumptions (which they are likely to be), the percentage ownership retained by the FRLA stockholders will be different.

As of [     ], 2024, there was approximately $[     ] million in FRLA’s trust account (the “Trust Account”). On [     ], 2024, the record date for the FRLA Special Meeting of stockholders, the last sale price of FRLA’s Class A Common Stock was $[     ].

Each stockholder’s vote is very important. Whether or not you plan to participate in the virtual FRLA Special Meeting, please submit your proxy card without delay. Stockholders may revoke proxies at any time before they are voted at the meeting. Voting by proxy will not prevent a stockholder from voting virtually at the FRLA Special Meeting if such stockholder subsequently chooses to participate in the FRLA Special Meeting.

We encourage you to read this proxy statement/prospectus/consent solicitation statement carefully. In particular, you should review the matters discussed under the caption “Risk Factors” beginning on page 33.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of the securities to be issued in the Business Combination or otherwise, or passed upon the adequacy of or accuracy of this proxy statement/prospectus/consent solicitation statement. Any representation to the contrary is a criminal offense.

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This proxy statement/prospectus/consent solicitation statement is dated [     ], 2024 and is first being mailed to stockholders of FRLA and WODI on or about [     ], 2024.

 

Ryan Spick		T. Riggs Eckelberry
Principal Executive Officer		Chief Executive Officer
Fortune Rise Acquisition Corporation		Water on Demand, Inc.
[     ], 2024		[     ], 2024

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FORTUNE RISE ACQUISITION CORPORATION

13575 58th Street North, Suite 200

Clearwater, Florida 33760

Telephone: (727) 440-4603

 

NOTICE OF SPECIAL MEETING OF STOCKHOLDERS

OF

FORTUNE RISE ACQUISITION CORPORATION

 

To be held on [     ], 2024

To Fortune Rise Acquisition Corporation Stockholders:

NOTICE IS HEREBY GIVEN, that you are cordially invited to attend a meeting of the stockholders of Fortune Rise Acquisition Corporation (“FRLA”, “we”, “our”, or “us”), which will be held virtually at [     ] Eastern Time, on [     ], 2024 at [     ] (the “FRLA Special Meeting”). You can participate in the virtual FRLA Special Meeting as described in “The FRLA Special Meeting.”

During the FRLA Special Meeting, FRLA’s stockholders will be asked to consider and vote upon the following proposals, which we refer to herein as the “FRLA Proposals”:

·To consider and vote upon a proposal to approve the transactions contemplated under the Business Combination Agreement, dated as of October 24, 2023 (as amended February 6, 2024, the “Business Combination Agreement”), by and among FRLA, FRLA Merger Sub, Inc., a Delaware corporation and wholly owned subsidiary of FRLA (“Merger Sub”), and Water on Demand, Inc., a Texas corporation (“WODI”), a copy of which is attached to this proxy statement/prospectus/consent solicitation statement as Annex A. This Proposal is referred to as the “FRLA Business Combination Proposal” or “FRLA Proposal 1.” 

·To consider and vote upon a proposal to approve the Amended and Restated Certificate of Incorporation of FRLA, a copy of which is attached to this proxy statement/prospectus/consent solicitation statement as Annex B (the “Amended Charter”). This Proposal is referred to as the “FRLA Charter Amendment Proposal” or “FRLA Proposal 2.” 

·To consider and vote upon, on a non-binding basis, certain differences between FRLA’s Current Charter and the Amended Charter, a copy of which is attached to this proxy statement/prospectus/consent solicitation statement as Annex B, for the following amendments (collectively, the “FRLA Advisory Charter Proposals” or “FRLA Proposal 3”): 

oChange to Authorized Capital Stock – to increase the total number of shares the Combined Company is authorized to issue (“Advisory Proposal 3A”); 

oRight of Stockholders to Act by Written Consent – to provide the right of the stockholders of the Combined Company to act by written consent except to the extent otherwise provided in our bylaws (“Advisory Proposal 3B”); and 

oRight of Stockholders to Call Meetings– to provide the right of the stockholders of the Combined Company to call a special meeting to the extent otherwise provided in our bylaws (“Advisory Proposal 3C”). 

·To consider a vote upon a proposal to approve the 2024 Fortune Rise Acquisition Corporation Equity Incentive Plan (the “Incentive Plan”), a copy of which is attached to this proxy statement/prospectus/consent solicitation statement as Annex D, to be effective upon the consummation of the Business Combination. This Proposal is referred to as the “FRLA Incentive Plan Proposal” or “FRLA Proposal 4.” 

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·To consider a vote upon a proposal to elect T. Riggs Eckelberry, Stephen Hall, Taron Lexton, Beau Vuillemot, Leslie Brock, and Jean-Louis Kindler as members of the Board of Directors effective as of the Closing until the expiration of their respective terms and until their respective successors are duly appointed and qualified. This Proposal is called the “FRLA Director Election Proposal” or “FRLA Proposal 5.” 

·To consider and vote upon a proposal to approve the issuance of the Common Stock in connection with transactions contemplated in the Business Combination Agreement as required by Nasdaq listing requirements. This Proposal is referred to as the “FRLA Nasdaq Proposal” or “FRLA Proposal 6.” 

·To consider a vote upon a proposal to approve the adjournment of the FRLA Special Meeting by the chairman thereof to a later date, if necessary, under certain circumstances, including for the purpose of soliciting additional proxies in favor of the foregoing Proposals. This Proposal is called the “FRLA Adjournment Proposal” or “FRLA Proposal 7.” 

The FRLA Business Combination Proposal is conditioned upon the approval of FRLA Proposals 2, 4, 5 and 6. FRLA Proposals 2, 4, 5 and 6 are dependent upon the approval of the FRLA Business Combination Proposal. It is important for you to note that in the event that the FRLA Business Combination Proposal is not approved, FRLA will not consummate the Business Combination. If FRLA does not consummate the Business Combination and fails to complete an initial business combination by November 5, 2024, FRLA will be required to dissolve and liquidate, unless we seek stockholder approval to amend our Current Charter to extend the date by which the Business Combination may be consummated.

Approval of the FRLA Business Combination Proposal, the FRLA Advisory Charter Proposals, the FRLA Charter Amendment Proposal, the FRLA Incentive Plan Proposal, the FRLA Nasdaq Proposal and the FRLA Adjournment Proposal will each require the affirmative vote of the holders of a majority of the issued and outstanding shares of FRLA Class A Common Stock and FRLA Class B Common Stock (together, the “FRLA Shares”) present in person by virtual attendance or represented by proxy and entitled to vote at the FRLA Special Meeting or any adjournment thereof. Approval of the FRLA Charter Amendment Proposal will require the affirmative vote of a majority of the issued and outstanding FRLA Shares.

As of [     ], 2024, there were 3,828,048 shares of FRLA Class A common stock, par value $0.0001 per share (“FRLA Class A Common Stock”) and 2,443,750 shares of FRLA Class B common stock, par value $0.0001 per share (“FRLA Class B Common Stock”) issued and outstanding and entitled to vote. Only FRLA stockholders who hold common stock of record as of the close of business on [     ], 2024 are entitled to vote at the FRLA Special Meeting or any adjournment of the FRLA Special Meeting. This proxy statement/prospectus/consent solicitation statement is first being mailed to FRLA stockholders on or about [     ], 2024.

Investing in FRLA’s securities involves a high degree of risk. See “Risk Factors” beginning on page 34 for a discussion of information that should be considered in connection with an investment in FRLA’s securities.

YOUR VOTE IS VERY IMPORTANT. PLEASE VOTE YOUR SHARES PROMPTLY.

Whether or not you plan to participate in the virtual FRLA Special Meeting, please complete, date, sign and return the enclosed proxy card without delay, or submit your proxy through the internet or by telephone as promptly as possible in order to ensure your representation at the FRLA Special Meeting no later than the time appointed for the FRLA Special Meeting or adjourned meeting. Voting by proxy will not prevent you from voting your FRLA Shares online if you subsequently choose to participate in the virtual FRLA Special Meeting. Please note, however, that if your shares are held of record by a broker, bank or other agent and you wish to vote at the FRLA Special Meeting, you must obtain a proxy issued in your name from that record. Only stockholders of record at the close of business on the record date may vote at the FRLA Special Meeting or any adjournment or postponement thereof. If you fail to return your proxy card or fail to instruct your bank, broker or other nominee how to vote, and do not participate in the virtual FRLA Special Meeting, your shares will not be counted for purposes of determining whether a quorum is present at, and the number of votes voted at, the FRLA Special Meeting.

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You may revoke a proxy at any time before it is voted at the FRLA Special Meeting by executing and returning a proxy card dated later than the previous one, by participating in the virtual FRLA Special Meeting and casting your vote by hand or by ballot (as applicable) or by submitting a written revocation to [     ], that is received by the proxy solicitor before we take the vote at the FRLA Special Meeting. If you hold your shares through a bank or brokerage firm, you should follow the instructions of your bank or brokerage firm regarding revocation of proxies.

FRLA’s board of directors recommends that FRLA stockholders vote “FOR” approval of each of the Proposals. When you consider FRLA’s Board of Director’s recommendation of these Proposals, you should keep in mind that FRLA’s directors and officers have interests in the Business Combination that may conflict or differ from your interests as a stockholder. See the section titled “FRLA Proposal 1 – The FRLA Business Combination Proposal — Interests of Certain Persons in the Business Combination.”

On behalf of the FRLA Board of Directors, I thank you for your support and we look forward to the successful consummation of the Business Combination.

By Order of the Board of Directors,

  

Ryan Spick

Principal Executive Officer

Fortune Rise Acquisition Corporation

[     ], 2024

 

IF YOU RETURN YOUR PROXY CARD WITHOUT AN INDICATION OF HOW YOU WISH TO VOTE, YOUR SHARES WILL BE VOTED IN FAVOR OF EACH OF THE PROPOSALS.

TO EXERCISE YOUR REDEMPTION RIGHTS, YOU MUST (I) IF YOU: (A) HOLD SHARES OF PUBLIC FRLA CLASS A COMMON STOCK, OR (B) HOLD SHARES OF PUBLIC FRLA CLASS A COMMON STOCK THROUGH PUBLIC FRLA UNITS AND YOU ELECT TO SEPARATE YOUR PUBLIC UNITS INTO THE UNDERLYING PUBLIC FRLA CLASS A COMMON STOCK AND WARRANTS PRIOR TO EXERCISING YOUR REDEMPTION RIGHTS WITH RESPECT TO THE PUBLIC FRLA CLASS A COMMON STOCK; AND (II) PRIOR TO [     ] P.M., EASTERN TIME, ON [     ], 2024, (A) SUBMIT A WRITTEN REQUEST TO [     ] THAT FRLA REDEEM YOUR PUBLIC FRLA CLASS A COMMON STOCK FOR CASH AND (B) DELIVER YOUR SHARE CERTIFICATES (IF ANY) TO [     ], PHYSICALLY OR ELECTRONICALLY USING THE DEPOSITORY TRUST COMPANY’S DWAC (DEPOSIT WITHDRAWAL AT CUSTODIAN) SYSTEM, IN EACH CASE, IN ACCORDANCE WITH THE PROCEDURES DESCRIBED IN THE PROXY STATEMENT/PROSPECTUS/CONSENT SOLICITATION STATEMENT. IF THE BUSINESS COMBINATION IS NOT CONSUMMATED, THEN THE PUBLIC SHARES WILL NOT BE REDEEMED FOR CASH. IF YOU HOLD THE SHARES IN STREET NAME, YOU WILL NEED TO INSTRUCT THE ACCOUNT EXECUTIVE AT YOUR BANK OR BROKER TO WITHDRAW THE SHARES FROM YOUR ACCOUNT IN ORDER TO EXERCISE YOUR REDEMPTION RIGHTS. SEE “THE FRLA SPECIAL MEETING — REDEMPTION RIGHTS” IN THIS PROXY STATEMENT/PROSPECTUS/CONSENT SOLICITATION STATEMENT FOR MORE SPECIFIC INSTRUCTIONS.

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WATER ON DEMAND, INC.

13575 58th Street North, Suite 200

Clearwater, FL 33760

Telephone: (727) 440-4603

NOTICE OF SOLICITATION OF WRITTEN CONSENT

To the Stockholders of Water on Demand, Inc.:

We are pleased to enclose the proxy statement/prospectus/consent solicitation statement relating to the proposed merger of FRLA Merger Sub, Inc., a Delaware corporation (“Merger Sub”) and wholly owned subsidiary of Fortune Rise Acquisition Corporation, a Delaware corporation (“FRLA”) with and into Water on Demand, Inc., a Texas corporation (“WODI”), pursuant to a Business Combination Agreement, dated as of October 24, 2023 (as amended February 6, 2024, the “Business Combination Agreement”), by and among FRLA, Merger Sub and WODI. If (i) the Business Combination Agreement is adopted and the merger and the other transactions contemplated thereby (collectively, the “Business Combination”) are approved by FRLA’s stockholders and WODI’s shareholders, and (ii) the Business Combination is successfully completed, Merger Sub will merge with and into WODI with WODI surviving the merger as a wholly-owned subsidiary of FRLA, and all shares of WODI stock issued and outstanding immediately prior to the effective time of the Business Combination (the “Effective Time”) (other than those properly exercising any applicable dissenters rights under Texas law) will be converted into the right to receive a pro rata portion of the merger consideration upon the terms and conditions set forth in the Business Combination Agreement. Upon the consummation of the Business Combination, FRLA will change its name to “Water on Demand, Inc.”

The proxy statement/prospectus/consent solicitation statement attached to this notice is being delivered to you on behalf of WODI’s board of directors to request that holders of the outstanding shares of WODI’s common stock (“WODI Common Stock”) as of the record date of [_____] execute and return written consents to adopt and approve the Business Combination, the Business Combination Agreement, and the other transactions contemplated therein.

The attached proxy statement/prospectus/consent solicitation statement describes the proposed Business Combination and the actions to be taken in connection therewith and provides additional information about the parties involved. A copy of the Business Combination Agreement is attached as Annex A to this proxy statement/prospectus/consent solicitation statement.

A summary of the appraisal rights that may be available to you under Section 21.460 of the Texas Business Organizations Code (“TBOC”) with respect to the Business Combination is described in “No Appraisal Rights.” A copy of Section 21.460 of the TBOC is attached as Annex E to this proxy statement/prospectus/consent solicitation statement.

The WODI Board of Directors has considered the Business Combination and the terms of the Business Combination Agreement and has unanimously determined that the Business Combination and the Business Combination Agreement are advisable, fair to and in the best interests of WODI and its shareholders, and recommends that the WODI shareholders approve the Business Combination and the Business Combination Agreement by submitting a written consent.

Please complete, date and sign the written consent enclosed with this proxy statement/prospectus/consent solicitation statement and return it promptly to WODI by one of the means described in “WODI’s Solicitation Of Written Consents.”

By Order of the Board of Directors,

  

T. Riggs Eckelberry

Chief Executive Officer

Water on Demand, Inc.

[     ], 2024

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ADDITIONAL INFORMATION

If you would like to receive additional information or if you want additional copies of this document, agreements contained in the appendices or any other documents filed by FRLA and WODI with the Securities and Exchange Commission, such information is available without charge upon written or oral request. Please contact our proxy solicitor:

For FRLA Stockholders:	For WODI Shareholders:
[     ]	Jon Peraza at jon@originclear.com

 

If you would like to request documents, please do so no later than [     ], 2024, to receive them before the FRLA Special Meeting. Please be sure to include your complete name and address in your request. Please see the section titled “Where You Can Find More Information” to find out where you can find more information about FRLA and WODI.

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ABOUT THIS PROXY STATEMENT/PROSPECTUS/CONSENT SOLICITATION STATEMENT

This document, which forms part of a registration statement on Form S-4 filed with the SEC by FRLA, constitutes a prospectus of FRLA under the Securities Act of 1933, as amended (the “Securities Act”), with respect to the shares of Common Stock to be issued to WODI’s shareholders pursuant to the Business Combination Agreement. This document also constitutes a proxy statement of FRLA under Section 14(a) of the Securities Exchange Act of 1934, as amended (the “Exchange Act”) and a consent solicitation statement by WODI.

You should rely only on the information contained in this proxy statement/prospectus/consent solicitation statement in deciding how to vote on the Business Combination. Neither FRLA nor WODI has authorized anyone to give any information or to make any representations other than those contained in this proxy statement/prospectus/consent solicitation statement. Do not rely upon any information or representations made outside of this proxy statement/prospectus/consent solicitation statement. The information contained in this proxy statement/prospectus/consent solicitation statement may change after the date of this proxy statement/prospectus/consent solicitation statement. Do not assume after the date of this proxy statement/prospectus/consent solicitation statement that the information contained in this proxy statement/prospectus/consent solicitation statement is still correct.

Information contained in this proxy statement/prospectus/consent solicitation statement regarding FRLA and its business, operations, management and other matters has been provided by FRLA, and information contained in this proxy statement/prospectus/consent solicitation statement regarding WODI and its business, operations, management and other matters has been provided by WODI.

This proxy statement/prospectus/consent solicitation statement does not constitute an offer to sell or a solicitation of an offer to buy any securities, or the solicitation of a proxy or consent, in any jurisdiction to or from any person to whom it is unlawful to make any such offer or solicitation in such jurisdiction.

MARKET AND INDUSTRY DATA

Certain information contained in this document relates to or is based on studies, publications, surveys and other data obtained from third-party sources and FRLA’s and WODI’s own internal estimates and research. While we believe these third-party sources to be reliable as of the date of this proxy statement/prospectus/consent solicitation statement, we have not independently verified the market and industry data contained in this proxy statement/prospectus/consent solicitation statement or the underlying assumptions relied on therein. Finally, while we believe our own internal research is reliable, such research has not been verified by any independent source.

TRADEMARKS

This document contains references to trademarks, trade names and service marks belonging to other entities. Solely for convenience, trademarks, trade names and service marks referred to in this proxy statement/prospectus/consent solicitation statement may appear without the ® or TM symbols, but such references are not intended to indicate, in any way, that the applicable licensor will not assert, to the fullest extent under applicable law, its rights to these trademarks and trade names. We do not intend our use or display of other companies’ trade names, trademarks or service marks to imply a relationship with, or endorsement or sponsorship of us by, any other companies.

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CAUTIONARY NOTE REGARDING FORWARD-LOOKING STATEMENTS

This proxy statement/prospectus/consent solicitation statement contains forward-looking statements, including statements about the parties’ ability to close the Business Combination, the anticipated benefits of the Business Combination, and the financial condition, results of operations, earnings outlook and prospects of FRLA and/or WODI and may include statements for the period following the consummation of the Business Combination. Forward-looking statements appear in a number of places in this proxy statement/prospectus/consent solicitation statement including, without limitation, in the sections titled “Management’s Discussion and Analysis of Financial Condition and Results of Operations of WODI” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations of FRLA.” In addition, any statements that refer to projections, forecasts or other characterizations of future events or circumstances, including any underlying assumptions, are forward-looking statements. Forward-looking statements are typically identified by words such as “plan,” “believe,” “expect,” “anticipate,” “intend,” “outlook,” “estimate,” “forecast,” “project,” “continue,” “could,” “may,” “might,” “possible,” “potential,” “predict,” “should,” “would” and other similar words and expressions, but the absence of these words does not mean that a statement is not forward-looking.

The forward-looking statements are based on the current expectations of the management of FRLA and WODI as applicable and are inherently subject to uncertainties and changes in circumstances and their potential effects and speak only as of the date of such statement. There can be no assurance that future developments will be those that have been anticipated. These forward-looking statements involve a number of risks, uncertainties or other assumptions that may cause actual results or performance to be materially different from those expressed or implied by these forward-looking statements. These risks and uncertainties include, but are not limited to, those factors described in “Risk Factors,” those discussed and identified in public filings made with the SEC by FRLA and the following:

·actual results may vary from expectations regarding WODI and WODI’s ability to meet expectations related to its products, technologies and services and its ability to attract and retain revenue-generating customers and execute on its growth plans; 

·the inability of the parties to successfully or timely consummate the Business Combination, including the risk that any required regulatory approvals are not obtained, are delayed or are subject to unanticipated conditions that could adversely affect WODI or the expected benefits of the Business Combination, if not obtained; 

·the failure to realize the anticipated benefits of the Business Combination; 

·the ability of FRLA prior to the Business Combination, and the Combined Company following the Business Combination, to maintain the listing of FRLA’s securities on Nasdaq; 

·costs related to the Business Combination; 

·the failure to satisfy the conditions to the consummation of the Business Combination, including the approval of the transactions contemplated under the Business Combination Agreement by the stockholders of FRLA; 

·the risk of actual or alleged failure to comply with data privacy laws and regulations; 

·the outcome of any legal proceedings that may be instituted against FRLA or WODI related to the Business Combination; 

·the attraction and retention of qualified directors, officers, employees and key personnel of FRLA and WODI prior to the Business Combination, and of the Combined Company following the Business Combination; 

·the impact from future regulatory, judicial, and legislative changes in WODI’s industry; 

·the uncertain effects of the COVID-19 pandemic, Russian invasion of Ukraine and the conflict in Israel and Gaza and the effects of such events on capital markets; and 

·those factors set forth in documents of FRLA filed, or to be filed, with SEC. 

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Should one or more of these risks or uncertainties materialize or should any of the assumptions made by the management of FRLA and WODI prove incorrect, actual results may vary in material respects from those projected in these forward-looking statements.

All subsequent written and oral forward-looking statements concerning the Business Combination or other matters addressed in this proxy statement/prospectus/consent solicitation statement and attributable to FRLA, WODI or any person acting on their behalf are expressly qualified in their entirety by the cautionary statements contained or referred to in this proxy statement/prospectus/consent solicitation statement. Except to the extent required by applicable law or regulation, FRLA and WODI undertake no obligation to update these forward-looking statements to reflect events or circumstances after the date of this proxy statement/prospectus/consent solicitation statement or to reflect the occurrence of unanticipated events.

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CERTAIN DEFINED TERMS

Unless otherwise stated in this proxy statement/prospectus/consent solicitation statement, the terms “we,” “us,” “our,” or “FRLA” refer to Fortune Rise Acquisition Corporation, a Delaware corporation. Further in this document:

“Amended Bylaws” means the Amended & Restated Bylaws of FRLA to take effect upon FRLA’s stockholders approving the Amended & Restated Bylaws, in the form included as Annex C to this proxy statement/prospectus/consent solicitation statement, as further described in the “Charter Amendment Proposal” and the “Advisory Proposal” sections of this proxy statement/prospectus/consent solicitation statement.

“Amended Charter” means the Second Amended & Restated Certificate of Incorporation of FRLA to take effect upon FRLA’s stockholders approving the Second Amended & Restated Certificate of Incorporation, in the form included as Annex B to this proxy statement/prospectus/consent solicitation statement, as further described in the “Charter Amendment Proposal” and the “Advisory Charter Proposals” sections of this proxy statement/prospectus/consent solicitation statement.

“Boards” means FRLA Board and the WODI Board.

“Business Combination Agreement” means that certain Business Combination Agreement, dated as of October 24, 2023, by and among FRLA, Merger Sub and WODI, as amended on February 6, 2024, and as it may be further amended or supplemented.

“Business Combination” means the merger contemplated by the Business Combination Agreement.

“Certificate of Incorporation” or “Current Charter” means FRLA’s current Amended and Restated Certificate of Incorporation, as amended.

“Closing Date” means date of the consummation of the Business Combination.

“Closing” means the consummation of the Business Combination.

“Code” means the Internal Revenue Code of 1986, as amended.

“Combined Company” means FRLA after the Business Combination, renamed “Water on Demand, Inc.”

“Common Stock” means the common stock, par value $0.0001 per share, of FRLA, into which the FRLA Class A Common Stock and FRLA Class B Common Stock shall convert at the Effective Time, and following the Closing, the common stock, par value $0.0001 per share of the Combined Company.

“Company Support Agreements” means the agreements entered into simultaneously with execution of the Business Combination Agreement pursuant to which certain stockholders of WODI and FRLA agreed to vote all of the shares of WODI Stock beneficially owned by them in favor of the Business Combination.

“Effective Time” means the time at which the Business Combination becomes effective.

“Equity Value Per Share” means (a) the Equity Value, divided by (b) the Fully Diluted Company Shares.

“Equity Value” means $32,000,000.

“Exchange Act” means the Securities Exchange Act of 1934, as amended.

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“Exchange Ratio” means (a) the Equity Value Per Share, divided by (b) the FRLA Share Value.

“Founder Shares” means the FRLA Class B Common Stock.

“FRLA Board” means the board of directors of FRLA.

“FRLA Class A Common Stock” means the Class A common stock, $0.0001 par value per share, of FRLA.

“FRLA Class B Common Stock” means the Class B common stock, $0.0001 par value per share, of FRLA.

“FRLA Common Stock” means the common stock, $0.0001 par value per share, of FRLA.

“FRLA Shares” means the FRLA Class A Common Stock and the FRLA Class B Common Stock.

“FRLA Special Meeting” means the special meeting of the stockholders of FRLA, which will be held at [     ], Eastern time, on [     ], 2024.

“Fully Diluted Company Shares” means the sum of (a) the aggregate number of shares of WODI Common Stock issued and outstanding as of immediately prior to the Effective Time, (b) that number of restricted stock grants subject to vesting and (c) the number of shares of WODI Common Stock issuable upon conversion of a share of Company Preferred Stock based on the then applicable conversion ratio.

“GAAP” means accounting principles generally accepted in the United States of America.

“Governmental Entity” means any United States or non-United States (a) federal, state, regional, provincial, local, municipal or other government, (b) governmental or quasi-governmental entity of any nature (including any governmental agency, branch, department, official, or entity and any court or other tribunal) or (c) body exercising or entitled to exercise any administrative, executive, judicial, legislative, police, regulatory, or taxing authority or power of any nature, including any arbitral tribunal (public or private); provided, however, that (for the avoidance of doubt) institutional review boards shall not be “Governmental Entities” hereunder.

“HSR Act” means Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended.

“Incentive Plan” means the 2024 Fortune Rise Acquisition Corporation Equity Incentive Plan.

“Initial Stockholders” means the Sponsor and other initial holders of FRLA Class B Common Stock.

“IPO” refers to the initial public offering of 9,775,000 Units of FRLA consummated on November 5, 2021.

“IRS” means the United States Internal Revenue Service.

“Lock-Up Agreements” means the agreements to be entered into in connection with the Closing, pursuant to which the Sponsor and certain WODI shareholders agreed to certain restrictions on transfer of shares of Common Stock they will receive pursuant to the Business Combination.

“Merger Consideration Shares” means an aggregate number of shares of FRLA Common Stock equal to the product of (i) the Exchange Ratio, multiplied by (ii) the aggregate number of issued and outstanding shares of WODI Common Stock issued and outstanding as of the Closing.

“Merger Consideration Spreadsheet” the spreadsheet to be delivered by WODI to FRLA at the Closing setting forth, among other things, calculations of the Per Share Merger Consideration Amount, the Exchange Ratio, the Merger Consideration Shares.

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“Merger Sub” means FRLA Merger Sub, Inc., a Delaware corporation and wholly-owned subsidiary of FRLA.

“OCLN” means OriginClear, Inc., a Nevada corporation and parent corporation to WODI.

“Order” means any outstanding writ, order, judgment, injunction, binding decision or determination, award, ruling, subpoena, verdict or decree entered, issued or rendered by any Governmental Entity.

“Organizational Documents” means organizational or governing documents of an applicable entity.

“Outside Date” means July 24, 2024.

“Per Share Merger Consideration Amount” means an amount equal to (a) the Aggregate Exercise Price, divided by (b) the number of Fully Diluted Company Shares.

“Private Placement Shares” means the 545,500 shares of FRLA Class A Common Stock issued to the Sponsor and the Representatives in a private placement.

“Public Shares” means the currently outstanding [__] FRLA Class A Common Shares sold as part of the Public Units in FRLA’s IPO or acquired in the secondary market.

“Public Units” means the units of FRLA sold in the IPO, each consisting of one share of FRLA Class A Common Stock and one-half of one redeemable Public Warrant.

“Public Warrants” means the warrants underlying the Public Units sold in the IPO. Each whole Public Warrant entitles the holder thereof to purchase one share of FRLA Class A Common Stock for $11.50 per share (subject to adjustment).

“Representatives” means U.S. Tiger Securities, Inc. and EF Hutton, a division of Benchmark Investment LLC.

“SEC” means the U.S. Securities and Exchange Commission.

“Securities Act” means the Securities Act of 1933, as amended.

“Sponsor” means Fortune Rise Sponsor, LLC, a Delaware limited liability company.

“Sponsor Letter Agreement” means the agreement entered into simultaneously with execution of the Business Combination Agreement pursuant to which certain stockholders of WODI and FRLA agreed to vote all of the shares of FRLA stock beneficially owned by them in favor of the Business Combination.

“TBOC” means the Texas Business Organizations Code.

“Trust Account” means FRLA’s trust account maintained by Wilmington Trust, National Association.

“Trust Agreement” means that certain Investment Management Trust Agreement, dated as of August 30, 2021 by and between FRLA and Wilmington Trust, National Association, as trustee.

“VStock” means VStock Transfer, LLC, FRLA’s transfer agent.

“WODI” means Water on Demand, Inc., a Texas corporation.

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“WODI Board” means the board of directors of WODI.

“WODI Charter” means the certificate of incorporation of WODI in effect immediately prior to the Effective Time.

“WODI Common Stock” means shares of common stock of WODI, par value $0.0001 per share.

“WODI Convertible Notes” means the Convertible Promissory Notes issued by WODI pursuant to that certain Convertible Note Purchase Agreements.

“WODI RSG” means those shares of restricted stock in WODI.

“WODI Stock” means the shares of WODI Common Stock immediately prior to the Closing.

“WODI shareholders” means the holders of WODI Stock immediately prior to the Effective Time.

“WODI Shareholder Consent” means the written consent of the WODI shareholders in connection with the Business Combination and the Business Combination Agreement.

“WODI Warrants” refer to the warrants issued by WODI and assumed by FRLA in connection with the Business Combination.

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Share Calculations and Ownership Percentages

Unless otherwise specified (including in the section entitled “Unaudited Pro Forma Condensed Combined Financial Information”), the share calculations and ownership percentages set forth in this proxy statement/prospectus/consent solicitation statement with respect to FRLA’s stockholders following the Business Combination are for illustrative purposes only and assume the following (certain capitalized terms below are defined elsewhere in this proxy statement/prospectus/consent solicitation statement):

1.No public stockholders exercise their redemption rights in connection with the Closing of the Business Combination, and the balance of the Trust Account as of the Closing is the same as its balance on [     ], 2024 of approximately $[     ] million. Please see the section entitled “The FRLA Special Meeting — Redemption Rights.” 

2.There are no transfers by the Sponsor of FRLA securities currently held by the Sponsor on or prior to the Closing Date. 

3.No holders of Public Warrants exercise any of the outstanding Public Warrants. 

4.There are no issuances of equity securities of FRLA prior to or in connection with the Closing. 

5.That none of the WODI shareholders exercises appraisal rights in connection with the Closing. 

6.That, unless otherwise noted or as described in item 7 below, that for all purposes the number of outstanding shares and equity-linked securities of each of FRLA and WODI is the same as the number of outstanding shares and equity-linked securities of FRLA and WODI, respectively, as of [     ], 2024. 

7.That each WODI Convertible Note be converted into shares of Common Stock in accordance with its terms and interest earned on which is computed, for purposes of this proxy statement/prospectus/consent solicitation statement, as of [     ], 2024. 

8.That each WODI RSG is automatically vested and the shares of Common Stock shall be exchanged for Merger Consideration. 

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QUESTIONS AND ANSWERS ABOUT THE PROPOSALS

The following are answers to some questions that you, as a stockholder of FRLA, may have regarding the Proposals being considered at the FRLA Special Meeting. We urge you to read carefully the remainder of this proxy statement/prospectus/consent solicitation statement because the information in this section does not provide all the information that might be important to you with respect to the Proposals and the other matters being considered at the FRLA Special Meeting. Additional important information is also contained in the annexes to and the documents incorporated by reference into this proxy statement/prospectus/consent solicitation statement.

 

Q:What is the purpose of this document? 

A:FRLA, Merger Sub, and WODI, have agreed to the Business Combination under the terms of the Business Combination Agreement, which is attached to this proxy statement/prospectus/consent solicitation statement as Annex A, and is incorporated into this proxy statement/prospectus/consent solicitation statement by reference. FRLA is holding a special meeting of its stockholders (the “FRLA Special Meeting”) to obtain approval of the FRLA Business Combination Proposal, the FRLA Charter Amendment Proposal, the FRLA Advisory Charter Proposals, the FRLA Incentive Plan Proposal, the FRLA Director Election Proposal, the FRLA Nasdaq Proposal, and the FRLA Adjournment Proposal. WODI is seeking the approval of its shareholders for the Business Combination and Business Combination Agreement by written consent (the “WODI Shareholder Consent”). This proxy statement/prospectus/consent solicitation statement summarizes the information that you need to know in order to cast your vote. Your vote is very important. 

 

Q:Who is entitled to vote for FRLA? 

A:The FRLA Board has set [     ], 2024 as the record date (the “FRLA Record Date”) for determining FRLA stockholders entitled to vote at the FRLA Special Meeting. Holders of outstanding shares of FRLA Class A Common Stock and FRLA Class B Common Stock as of the close of business on the FRLA Record Date will be entitled to vote in person or by proxy on the FRLA Proposals. 

 

Q:Who is entitled to vote for WODI? 

A:The WODI Board has set [     ], 2024 as the record date (the “WODI Record Date”) for determining WODI shareholders entitled to sign and deliver written consents with respect to this consent solicitation statement. Holders of outstanding shares of WODI common stock or WODI preferred stock as of the close of business on the WODI Record Date will be entitled to vote in person or by proxy on the WODI Proposals. 

 

Q:What are the FRLA stockholders being asked to vote on? 

A:Below are the Proposals that the FRLA stockholders are being asked to vote on: 

·FRLA Proposal 1 — The FRLA Business Combination Proposal to approve the Business Combination Agreement and the Business Combination. 

·FRLA Proposal 2 — The FRLA Charter Amendment Proposal to approve the Amended and Restated Certificate of Incorporation (the “Amended Charter”) attached to this proxy statement/prospectus/consent solicitation statement as Annex B. 

·FRLA Proposal 3 — The FRLA Charter Advisory Proposals to consider and vote upon, on a non-binding basis, certain differences between FRLA’s Current Charter and the Amended Charter: 

oAdvisory Proposal 3A: Change to Authorized Capital Stock – to increase the total number of shares the Combined Company is authorized to issue; 

oAdvisory Proposal 3B: Right of Stockholders to Act by Written Consent – to provide the right of the stockholders of the Combined Company to act by written consent except to the extent otherwise provided in our bylaws; and 

oAdvisory Proposal 3C: Right of Stockholders to Call Meetings – to provide the right of the stockholders of the Combined Company to call a special stockholder meeting to the extent otherwise provided in our bylaws. 

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·FRLA Proposal 4 — The FRLA Incentive Plan Proposal to approve the Incentive Plan. 

·FRLA Proposal 5 — The FRLA Director Election Proposal to elect T. Riggs Eckelberry, Stephen Hall, Taron Lexton, Beau Vuillemot, Leslie Brock, and Jean-Louis Kindler as members of the Board of Directors, effective as of the Closing. 

·FRLA Proposal 6 — The FRLA Nasdaq Proposal to approve the issuance of more than 20% of the issued and outstanding shares of common stock in connection with (i) the terms of the Business Combination Agreement, which will result in a change of control, as required by Nasdaq Listing Rule 5635(a) and (b). 

·FRLA Proposal 7 — The FRLA Adjournment Proposal to approve the adjournment of the FRLA Special Meeting. 

 

Q:What are the WODI stockholders being asked to vote on? 

A:The WODI shareholders are being asked to vote on the WODI Business Combination Proposal to approve the Business Combination, the Business Combination Agreement and the other transactions contemplated therein. 

 

Q:What vote is required to approve the Proposals? 

A:The required vote for each proposal is as follows: 

·FRLA Proposal 1 — The FRLA Business Combination Proposal requires the affirmative vote of the majority of the issued and outstanding shares of common stock present by virtual attendance or represented by proxy and entitled to vote at the FRLA Special Meeting. An abstention will have the effect of a vote “AGAINST” Proposal 1. Broker non-votes will have no effect on the vote for Proposal 1. 

·FRLA Proposal 2 — The FRLA Charter Amendment Proposal requires the affirmative vote of the majority of the issued and outstanding shares of common stock. Abstentions and broker non-votes will have the effect of a vote “AGAINST” Proposal 2. 

·FRLA Proposal 3 — The FRLA Charter Advisory Proposals require the affirmative vote of a majority of the voting power of FRLA Shares. Abstentions will have the effect of a vote “AGAINST” Proposal 3. Broker non-votes will have no effect on the vote for Proposal 3. 

·FRLA Proposal 4 — The FRLA Incentive Plan Proposal requires the affirmative vote of the majority of the issued and outstanding shares of common stock present in person by virtual attendance or represented by proxy and entitled to vote. Abstentions will have the effect of a vote “AGAINST” Proposal 4. Broker non-votes will have no effect on the vote for Proposal 4. 

·FRLA Proposal 5 — Directors are elected by a plurality of all of the votes cast by the stockholders present in person (which would include presence at a virtual meeting) or represented by proxy at the FRLA Special Meeting. This means that the six director nominees who receive the most affirmative votes will be elected. Stockholders may not cumulate their votes with respect to the election of directors. Accordingly, a stockholder’s failure to vote by proxy or to vote in person (which would include presence at a virtual meeting) at the FRLA Special Meeting, as well as an abstention from voting and a broker non-vote with regard to the FRLA Director Election Proposal, will have no effect on the FRLA Director Election Proposal. 

·FRLA Proposal 6 — The FRLA Nasdaq Proposal requires the affirmative vote of the majority of the issued and outstanding shares of common stock present by virtual attendance or represented by proxy and entitled to vote at the FRLA Special Meeting. Abstentions will have the effect of a vote “AGAINST” Proposal 6. Broker non-votes will have no effect on the vote for Proposal 6. 

·FRLA Proposal 7 — The FRLA Adjournment Proposal requires the affirmative vote of the majority of the issued and outstanding shares of common stock present in person by virtual attendance or represented by proxy and entitled to vote at the FRLA Special Meeting. Abstentions will have the effect of a vote “AGAINST” Proposal 7. Broker-non votes have no effect on the vote for Proposal 7. 

Q:Are any of the Proposals conditioned on one another? 

A:The FRLA Business Combination Proposal is conditioned upon the approval of FRLA Proposals 2, 4, 5 and 6. FRLA Proposals 2, 4, 5 and 6 are dependent upon approval of the Business Combination Proposal. It is important for you to note that in the event that the FRLA Business Combination Proposal is not approved, FRLA will not consummate the Business Combination. If FRLA does not consummate the Business  

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Combination and fails to complete an initial business combination by November 5, 2024, FRLA will be required to dissolve and liquidate, unless we seek stockholder approval to amend our Certificate of Incorporation to extend the date by which the Business Combination may be consummated.

 

Q:How will FRLA’s Initial Stockholders vote? 

A:Pursuant to a letter agreement, the Initial Stockholders agreed to vote their respective shares of common stock acquired by them prior to the IPO and any shares of common stock purchased by them in the open market after the IPO in favor of the Business Combination Proposal and related proposals (“Letter Agreement”). In addition, in connection with the execution of the Business Combination Agreement, the Sponsor entered into the Sponsor Letter Agreement with WODI pursuant to which it agreed to vote all shares of FRLA Class B Common Stock beneficially owned it them in favor of the Business Combination Proposal. As of December 31, 2023, a total of 2,283,750 shares of common stock, or approximately 36% of the outstanding shares, were subject to the Sponsor Letter Agreement. As a result, 26,650 shares of common stock held by the public stockholders will need to be present in person by virtual attendance or by proxy to satisfy the quorum requirement for the FRLA Special Meeting. 

 

Q:How many votes do I and others have? 

A:FRLA stockholders are entitled to one vote for each Public Share held as of the FRLA Record Date. As of the close of business on the Record Date, there were 3,162,548 outstanding Public Shares. 

 

WODI shareholders are entitled to one vote for each share of WODI common stock (on an as-converted-to-common stock basis) held as of the WODI Record Date. As of the close of business on the Record Date, there were 13,399,267 outstanding shares of WODI common stock and no outstanding shares of WODI preferred stock.

 

Q:What will happen in the Business Combination? 

A:At the Closing of the Business Combination, Merger Sub will merge with and into WODI, with WODI surviving such merger as the surviving entity. Upon consummation of the Business Combination, WODI will become a wholly-owned subsidiary of FRLA. In connection with the Business Combination, the cash held in the Trust Account after giving effect to any redemption of shares by FRLA’s public stockholders will be used to pay certain fees and expenses in connection with the Business Combination, and for working capital and general corporate purposes. A copy of the Business Combination Agreement is attached to this proxy statement/prospectus/consent solicitation statement as Annex A. 

 

Q:What is the consideration being paid to WODI security holders? 

A:Subject to the terms of the Business Combination Agreement and customary adjustments set forth therein, the consideration to be delivered to WODI Security Holders in connection with the Business Combination are the Merger Consideration Shares which will consist of newly issued shares of Common Stock of the Combined Company. The number of newly-issued shares of Common Stock that each holder of WODI Common Stock will receive as a result of the Business Combination will be the product of the number of shares of WODI Common Stock held by such holder and the Exchange Ratio. At the Closing, the WODI shareholders will receive the Merger Consideration Shares. WODI shareholders that have validly exercised appraisal rights pursuant to Section 21.460 of the TBOC (“Dissenting Stockholders”) with respect to shares of WODI Stock (“Dissenting Shares”) shall not be entitled to receive any portion of the Merger Consideration Shares with respect to the Dissenting Shares, unless and until such Dissenting Stockholder has effectively withdrawn or lost such dissenting stockholder’s appraisal rights under the TBOC. 

 

Q:What equity stake will current stockholders of FRLA and WODI shareholders hold in the Combined Company after the Closing? 

A:If any of FRLA’s public stockholders exercise their redemption rights, the percentage of the Combined Company’s outstanding Common Stock held by FRLA’s public stockholders will decrease and the percentages of the Combined Company’s outstanding Common Stock held by the Sponsor, the Initial Stockholders and by the WODI shareholders will increase, in each case relative to the percentage held if none of the Public Shares are redeemed. Upon the issuance of Common Stock in connection with the Business Combination, the percentage ownership of the Combined Company by FRLA public stockholders who do  

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not redeem their Public Shares will be diluted. FRLA public stockholders that do not redeem their FRLA Public Shares in connection with the Business Combination will experience further dilution upon the exercise of the Public Warrants that are retained after the Closing. The percentage of the total number of outstanding shares of Common Stock of the Combined Company that will be owned by FRLA public stockholders as a group will vary based on the number of Public Shares for which the holders thereof request redemption in connection with the Business Combination.

 

The following table illustrates varying ownership levels in the Combined Company, assuming no redemptions by FRLA public stockholders, 25% redemption by FRLA public stockholders, 50% redemption by FRLA public stockholders, 75% redemption by FRLA public stockholders and the maximum redemptions by FRLA public stockholders:

 

		Scenario 1 Assuming No Redemptions				Scenario 2 Assuming 25% Redemptions
Equity Capitalization Summary		Shares		%		Shares		%
WODI Shareholders		3,542,691		42.8%		3,542,691		47.2%
FRLA Public Stockholders		3,162,548		38.1%		2,371,911		31.6%
FRLA Initial Stockholders(a)		1,466,750		17.7%		1,466,750		19.6%
Representatives Shares		120,000		1.4%		120,000		1.6%
Total Common Stock		8,291,989		100.0%		7,501,352		100.0%

 

		Scenario 3 Assuming 50% Redemptions				Scenario 4 Assuming 75% Redemptions
Equity Capitalization Summary		Shares		%		Shares		%
WODI Shareholders		3,542,691		52.7%		3,542,691		59.8%
FRLA Public Stockholders		1,581,274		23.6%		790,637		13.4%
FRLA Initial Stockholders(a)		1,466,750		21.9%		1,466,750		24.8%
Representatives Shares		120,000		1.8%		120,000		2.0%
Total Common Stock		6,710,715		100.0%		5,920,078		100.0%

 

		Scenario 5 Assuming Maximum Redemptions
Equity Capitalization Summary		Shares		%
WODI Shareholders		3,542,691		69.1%
FRLA Public Stockholders		-		-%
FRLA Initial Stockholders(a)		1,466,750		28.6%
Representatives Shares		120,000		2.3%
Total Common Stock		5,129,441		100.0%

 

(a)Including forfeiture of 1,522,500 shares of FRLA Class B Common Stock owned by FRLA Sponsor pursuant to the Sponsor Letter Agreement.   

 

Q:Do any of FRLA’s directors or officers have interests that may conflict with FRLA stockholder interests with respect to the Business Combination? 

A:In considering the recommendation of the Board to approve the FRLA Business Combination Agreement, FRLA stockholders should be aware that certain FRLA executive officers and directors may be deemed to have interests in the Business Combination that are different from, or in addition to, those of FRLA  

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stockholders generally. These interests, which may create actual or potential conflicts of interest, are, to the extent material, described in the section entitled “FRLA Proposal 1 – The FRLA Business Combination Proposal — Interests of FRLA’s Directors and Officers in the Business Combination”.

 

Q:Do any of WODI’s directors or officers have interests in the Business Combination that may differ from or be in addition to the interests of WODI shareholders? 

A:WODI’s executive officers and certain non-employee directors may have interests in the Business Combination that may be different from, or in addition to, the interests of WODI shareholders, generally. These interests may cause the directors and executive officers of WODI to view the Business Combination differently than WODI shareholders may generally view it. The WODI Board was aware of and considered these interests to the extent such interests existed at the time, among other matters, in approving the Business Combination Agreement, the Business Combination and the other transactions contemplated by the Business Combination Agreement, and in recommending that the Business Combination Agreement, the Business Combination and the other transactions contemplated by the Business Combination Agreement be approved by WODI shareholders. For more information on the interests of WODI’s directors and executive officers in the Merger, see the sections titled “Security Ownership of Certain Beneficial Owners and Management,” “Certain Relationships and Related Party Transactions” and “Directors and Executive Officers of the Combined Company After the Business Combination” of this proxy statement/prospectus/consent solicitation statement for a further discussion of these interests. 

 

Q:When and where is the FRLA Special Meeting? 

A:The FRLA Special Meeting will take place at [     ], on [     ], 2024, at [     ] a.m. 

 

Q:What is the quorum requirement for the FRLA Special Meeting? 

A:Stockholders representing a majority of the shares of FRLA Class A Common Stock and FRLA Class B Common Stock issued and outstanding as of the FRLA Record Date and entitled to vote at the FRLA Special Meeting must be present by virtual attendance or represented by proxy in order to hold the FRLA Special Meeting and conduct business. This is called a quorum. Shares of FRLA Class A Common Stock and FRLA Class B Common Stock will be counted for purposes of determining if there is a quorum if the stockholder (i) is present and entitled to vote at the meeting, or (ii) has properly submitted a proxy card or voting instructions through a broker, bank or custodian. In the absence of a quorum, stockholders representing a majority of the votes present in person or represented by proxy at such meeting may adjourn the meeting until a quorum is present. 

 

Q:Did the FRLA Board obtain a third-party valuation or fairness opinion in determining whether to proceed with the Business Combination? 

A:Yes. The FRLA Board obtained a fairness opinion from The Benchmark Company, LLC, dated October 24, 2023, which provided that, as of that date and based on and subject to the assumptions, qualifications and other matters set forth therein, the consideration to be paid by FRLA in the Business Combination was fair, from a financial point of view, to FRLA’s unaffiliated public stockholders. See the section of this proxy statement/prospectus entitled “Description of Fairness Opinion of Benchmark” for additional information. 

 

Q:Are FRLA stockholders required to vote against the Business Combination Proposal in order to have their Public Shares redeemed? 

A:No. FRLA stockholders are not required to vote against the Business Combination Proposal in order to have the right to demand that FRLA redeem your Public Shares for cash equal to your pro rata share of the aggregate amount then on deposit in the Trust Account (before payment of deferred underwriting commissions and including interest earned on their pro rata portion of the Trust Account, net of taxes payable). These rights to demand redemption of Public Shares for cash are sometimes referred to herein as “redemption rights.” If the Business Combination is not completed, holders of Public Shares electing to exercise their redemption rights will not be entitled to receive such payments and their Public Shares will be returned to them. 

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Q:How do FRLA stockholders exercise their redemption rights? 

A:If you are a public stockholder and you seek to have your Public Shares redeemed, you must (i) demand, no later than [     ] p.m., Eastern Time on [     ], 2024 (at least two business days before the FRLA Special Meeting), that FRLA redeem your shares into cash; and (ii) submit your request in writing to VStock, at the address listed at the end of this section and deliver your shares to VStock physically or electronically using The Depository Trust Company’s (“DTC”) DWAC (Deposit/Withdrawal at Custodian) System at least two business days before the FRLA Special Meeting. Any corrected or changed written demand of redemption rights must be received by VStock two business days before the FRLA Special Meeting. No demand for redemption will be honored unless the holder’s shares have been delivered (either physically or electronically) to VStock at least two business days before the FRLA Special Meeting. FRLA stockholders may seek to have their Public Shares redeemed regardless of whether they vote for or against the Business Combination and whether or not they are holders of common stock as of the FRLA Record Date. Any public stockholder who holds Public Shares on or before [     ], 2024 (two business days before the FRLA Special Meeting) will have the right to demand that his, her or its Public Shares be redeemed for a pro rata share of the aggregate amount then on deposit in the Trust Account, less any taxes then due but not yet paid, at the consummation of the Business Combination. The actual per share redemption price will be equal to the aggregate amount then on deposit in the Trust Account (before payment of deferred underwriting commissions and including interest earned on their pro rata portion of the Trust Account, net of taxes payable), divided by the number of Public Shares. Holders of Public Warrants and Public Units do not have redemption rights with respect to such securities in connection with the Business Combination. Holders of outstanding Public Units must separate the underlying Public Shares and Public Warrants prior to exercising redemption rights with respect to the Public Shares. Public stockholders who redeem their Public Shares into their share of the Trust Account still have the right to continue to hold any Public Warrants they hold outside of such Public Unit; however, no fractional warrants will be issued upon separation of the Public Units and only whole warrants will trade. Please see the section titled “The FRLA Special Meeting — Redemption Rights” for the procedures to be followed if you wish to redeem your shares of common stock for cash. 

 

Q:What are the material U.S. federal income tax consequences of the Business Combination to me? 

A:The material U.S. federal income tax considerations that may be relevant to you in respect of the Business Combination are discussed in more detail in the sections titled “Material U.S. Federal Income Tax Consequences.” The discussion of the U.S. federal income tax consequences contained in this proxy statement/prospectus/consent solicitation statement is intended to provide only a general discussion and is not a complete analysis or description of all of the U.S. federal income tax considerations that are applicable to you in respect of the Business Combination, nor does it address any tax considerations arising under U.S. state or local or non-U.S. tax laws. 

 

THE TAX CONSEQUENCES OF THE BUSINESS COMBINATION WILL DEPEND ON THE FACTS OF YOUR OWN SITUATION. YOU SHOULD CONSULT YOUR OWN TAX ADVISOR AS TO THE SPECIFIC TAX CONSEQUENCES OF THE BUSINESS COMBINATION TO YOU IN YOUR PARTICULAR CIRCUMSTANCES.

 

Q:What are the U.S. federal income tax consequences of FRLA stockholders exercising their redemption rights? 

A:In the event that a U.S. Holder elects to redeem its Public Shares for cash, the treatment of the transaction for U.S. federal income tax purposes will depend on whether the redemption qualifies as a sale or exchange of common stock under Section 302 of the Code or is treated as a distribution under Section 301of the Code. Whether the redemption qualifies as a sale or exchange or is treated as a distribution will depend on the facts and circumstances of each particular U.S. Holder at the time such holder exercises his, her, or its redemption rights. If the redemption qualifies as a sale or exchange of the common stock, the U.S. Holder will be treated as recognizing capital gain or loss equal to the difference between the amount realized on the redemption and such U.S. Holder’s adjusted tax basis in the common stock surrendered in such redemption transaction. Any such capital gain or loss generally will be long-term capital gain or loss if the U.S. Holder’s holding period for the common stock redeemed exceeds one year. The deductibility of capital losses is subject to limitations. See “Material U.S. Federal Income Tax Consequences — Certain Material U.S. Federal Income Tax  

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Consequences of Exercising Redemption Rights — Material U.S. Federal Income Tax Consequences” for a more detailed discussion of the U.S. federal income tax consequences.

 

Q:What do I need to do now? 

A:You are urged to read carefully and consider the information contained in this proxy statement/prospectus/consent solicitation statement, including the annexes, and to consider how the Business Combination will affect you as a stockholder. You should then vote as soon as possible in accordance with the instructions provided in this proxy statement/prospectus/consent solicitation statement and on the enclosed proxy card or, if you hold your shares through a brokerage firm, bank or other nominee, on the voting instruction form provided by the broker, bank or nominee. 

 

Q:How can I vote? 

A:If you are a stockholder of record, you may vote online at the virtual FRLA Special Meeting or vote by proxy using the enclosed proxy card, the Internet or telephone. Whether or not you plan to participate in the FRLA Special Meeting we urge you to vote by proxy to ensure your vote is counted. Even if you have already voted by proxy, you may still attend the virtual FRLA Special Meeting and vote online, if you choose. 

·To vote online at the virtual FRLA Special Meeting follow the instructions below under “How may I participate in the virtual FRLA Special Meeting?” 

·To vote using the proxy card, please complete, sign and date the proxy card and return it in the prepaid envelope. If you return your signed proxy card before the FRLA Special Meeting we will vote your shares as you direct. 

·To vote via the telephone, you can vote by calling the telephone number on your proxy card. Please have your proxy card handy when you call. Easy-to-follow voice prompts will allow you to vote your shares and confirm that your instructions have been properly recorded. 

·To vote via the Internet, FRLA stockholders should go to [     ] and follow the instructions. Please have your proxy card available when you go to the website. As with telephone voting, you can confirm that your instructions have been properly recorded. 

 

Telephone and Internet voting facilities for FRLA stockholders of record will be available 24 hours a day until 11:59 p.m. Eastern Time on [     ], 2024. After that, telephone and Internet voting will be closed, and if you want to vote your shares, you will either need to ensure that your proxy card is received before the date of the FRLA Special Meeting or attend the virtual FRLA Special Meeting to vote your shares online.

 

If your shares are registered in the name of your broker, bank or other agent, you are the “beneficial owner” of those shares and those shares are considered as held in “street name.” If you are a beneficial owner of shares registered in the name of your broker, bank or other agent, you should have received a proxy card and voting instructions with these proxy materials from that organization rather than directly from us. Simply complete and mail the proxy card to ensure that your vote is counted. You may be eligible to vote your shares electronically over the Internet or by telephone. A large number of banks and brokerage firms offer Internet and telephone voting. If your bank or brokerage firm does not offer Internet or telephone voting information, please complete and return your proxy card in the self-addressed, postage-paid envelope provided.

 

If you plan to vote at the virtual FRLA Special Meeting, you will need to contact VStock at the phone number or email below to receive a control number and you must obtain a legal proxy from your broker, bank or other nominee reflecting the number of shares FRLA Class A Common Stock you held as of the FRLA Record Date, your name and email address. You must contact VStock for specific instructions on how to receive the control number. Please allow up to 48 hours prior to the FRLA Special Meeting for processing your control number.

 

After obtaining a valid legal proxy from your broker, bank or other agent, to then register to attend the FRLA Special Meeting, you must submit proof of your legal proxy reflecting the number of your shares along with your name and email address to VStock. Requests for registration should be directed to VStock Transfer, LLC, Attn: Shaindy Diamond at (212) 828-8436 or email info@vstocktransfer.com. Requests for registration must be received no later than [     ] p.m., Eastern Time, on [     ], 2024.

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WODI shareholders may vote by completing and signing the written consent provided with this proxy statement/prospectus/consent solicitation statement and returning it to WODI on or before [     ]. Once WODI shareholders have completed, dated and signed the written consent, they may deliver it to WODI by emailing a copy to Jon Peraza at jon@originclear.com.

 

Q:How may I participate in the virtual FRLA Special Meeting? 

A:If you are a stockholder of record as of the FRLA Record Date for the FRLA Special Meeting, you should receive a proxy card from VStock, containing instructions on how to attend the virtual FRLA Special Meeting including the URL address, along with your control number. You will need your control number for access. If you do not have your control number, contact VStock at (212) 828-8436 or info@vstocktransfer.com. 

 

You can pre-register to attend the virtual FRLA Special Meeting starting on [     ], 2024. Go to [     ], enter the control number found on your proxy card you previously received, as well as your name and email address. Once you pre-register you can vote or enter questions in the chat box. At the start of the FRLA Special Meeting you will need to re-log into the website using your control number.

 

Q:Who can help answer any other questions I might have about the virtual FRLA Special Meeting? 

A:If you have any questions concerning the virtual FRLA Special Meeting (including accessing the meeting by virtual means) or need help voting your shares of common stock, please contact [     ] at [     ] or email [     ]. 

 

The Notice of FRLA Special Meeting, proxy statement/prospectus/consent solicitation statement and form of Proxy Card are available at: [     ].

 

Q:If my shares are held in “street name” by my bank, brokerage firm or nominee, will they automatically vote my shares for me? 

A:No. If you are a beneficial owner and you do not provide voting instructions to your broker, bank or other holder of record holding shares for you, your shares will not be voted with respect to any Proposal for which your broker does not have discretionary authority to vote. If a Proposal is determined to be discretionary, your broker, bank or other holder of record is permitted to vote on the Proposal without receiving voting instructions from you. If a Proposal is determined to be non-discretionary, your broker, bank or other holder of record is not permitted to vote on the Proposal without receiving voting instructions from you. A “broker non-vote” occurs when a bank, broker or other holder of record holding shares for a beneficial owner does not vote on a non-discretionary proposal because the holder of record has not received voting instructions from the beneficial owner. 

 

Each of the Proposals to be presented at the FRLA Special Meeting is a non-discretionary proposal. Accordingly, if you are a beneficial owner and you do not provide voting instructions to your broker, bank or other holder of record holding shares for you, your shares will not be voted with respect to any of the Proposals. A broker non-vote would have the same effect as a vote against the Charter Amendment Proposal and will have no effect on the Business Combination Proposal.

 

Q:What if I abstain from voting or fail to instruct my bank, brokerage firm or nominee? 

A:FRLA will count a properly executed proxy marked “ABSTAIN” with respect to a particular Proposal as present for the purposes of determining whether a quorum is present at the FRLA Special Meeting. For purposes of approval, an abstention on any Proposals will have the same effect as a vote “AGAINST” such Proposal. 

 

Q:If I am not going to attend the FRLA Special Meeting should I return my proxy card instead? 

A:Yes. Whether you plan to attend the FRLA Special Meeting virtually or not, please read the enclosed proxy statement/prospectus/consent solicitation statement carefully, and vote your shares by completing, signing, dating and returning the enclosed proxy card in the postage-paid envelope provided. 

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Q:How can I submit a proxy? 

A:FRLA stockholders may submit a proxy by (a) visiting [website] and following the on screen instructions (have your proxy card available when you access the webpage), or (b) calling toll-free [phone number] in the U.S. or [__] from foreign countries from any touch-tone phone and follow the instructions (have your proxy card available when you call), or (c) submitting your proxy card by mail by using the previously provided self-addressed, stamped envelope. 

 

WODI shareholders may submit a proxy by (a) visiting [website] and following the on screen instructions (have your proxy card available when you access the webpage), or (b) calling toll-free [phone number] in the U.S. or [__] from foreign countries from any touch-tone phone and follow the instructions (have your proxy card available when you call), or (c) submitting your proxy card by mail by using the previously provided self-addressed, stamped envelope.

 

Q:Can I change my vote after I have mailed my proxy card or written consent? 

A:Yes. You may change your vote at any time before your proxy is voted at the FRLA Special Meeting. You may revoke your proxy by executing and returning a proxy card dated later than the previous one, or by attending the virtual FRLA Special Meeting, in person and casting your vote or by voting again by the telephone or Internet voting options, or by submitting a written revocation stating that you would like to revoke your proxy that our proxy solicitor receives prior to the FRLA Special Meeting. If you hold your shares of common stock through a bank, brokerage firm or nominee, you should follow the instructions of your bank, brokerage firm or nominee regarding the revocation of proxies. 

WODI shareholders may change or revoke their consent to a proposal at any time before the consents of a sufficient number of shares to approve and adopt such proposal have been filed with WODI’s corporate secretary. WODI shareholders who wish to change or revoke a previously given consent before that time may do so by delivering a notice of revocation or by delivering a new written consent with a later date. If you are a record holder, you should send any notice of revocation or your completed new proxy card, as the case may be, to:

For FRLA Stockholders: [     ]

For WODI Shareholders: Jon Peraza at jon@originclear.com

 

Unless revoked, a proxy will be voted at the virtual FRLA Special Meeting in accordance with the stockholder’s indicated instructions. In the absence of instructions, proxies will be voted FOR each of the Proposals.

 

Q:What will happen if I return my proxy card or written consent without indicating how to vote? 

A:If you sign and return your proxy card without indicating how to vote on any particular Proposal, the shares of common stock or preferred stock represented by your proxy will be voted in favor of each Proposal. Proxy cards that are returned without a signature will not be counted as present at the FRLA Special Meeting and cannot be voted. Written consents which are signed by WODI shareholders without indicating a decision on a proposal will be deemed to have approved the Business Combination and adopted the Business Combination Agreement and the transactions contemplated thereby. 

 

Q:Should FRLA stockholders send in their share certificates now to have their shares of common stock redeemed? 

A:FRLA stockholders who intend to have their Public Shares redeemed should send their certificates to VStock at least two business days before the FRLA Special Meeting. Please see “The FRLA Special Meeting — Redemption Rights” for the procedures to be followed if you wish to redeem your Public Shares for cash. 

 

Q:Should WODI shareholders send in their stock certificates now? 

A:No. WODI shareholders SHOULD NOT send in any stock certificates now. If the Business Combination Agreement is adopted and the Business Combination is consummated, transmittal materials, with instructions  

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for their completion, will be provided under separate cover to WODI shareholders who hold physical stock certificates and the stock certificates should be sent at that time in accordance with such instructions.

 

Q:Who will solicit the proxies and pay the cost of soliciting proxies for the FRLA Special Meeting and WODI Shareholder consents? 

A:FRLA will pay the cost of soliciting proxies for the FRLA Special Meeting. FRLA has engaged [     ] to assist in the solicitation of proxies for the FRLA Special Meeting. FRLA has agreed to pay [     ] a fee of $[     ], plus disbursements, and will reimburse [     ] for its reasonable out-of-pocket expenses and indemnify [     ] and its affiliates against certain claims, liabilities, losses, damages, and expenses. FRLA will also reimburse banks, brokers and other custodians, nominees and fiduciaries representing beneficial owners of common stock for their expenses in forwarding soliciting materials to beneficial owners of the common stock and in obtaining voting instructions from those owners. FRLA directors, officers and employees may also solicit proxies by telephone, by facsimile, by mail, on the Internet or in person. They will not be paid any additional amounts for soliciting proxies. 

 

The expense of preparing, printing and mailing the WODI consent solicitation materials is being borne by WODI. Officers and employees of WODI may solicit consents by telephone and personally, in addition to solicitation by mail. These persons will receive their regular salaries but no special compensation for soliciting consents.

 

Q:What happens if I sell my shares before the FRLA Special Meeting or effective time of the WODI Shareholder Consent? 

A:The FRLA Record Date for the FRLA Special Meeting is earlier than the date of the FRLA Special Meeting, as well as the date that the Business Combination is expected to be consummated, and the WODI Record Date for the WODI Shareholder Consent is earlier than the expected effective date of the WODI Shareholder consent, as well as the date that the Business Combination is expected to be consummated. If FRLA stockholders transfer their FRLA Shares after the FRLA Record Date, but before the FRLA Special Meeting, unless the transferee obtains a proxy to vote those shares, such FRLA stockholder would retain their right to vote at the FRLA Special Meeting, but will transfer ownership of the shares and will not hold an interest in FRLA after the Business Combination is consummated. If WODI shareholders transfer their shares of WODI common stock after the WODI Record Date, but before the effective date of the WODI Shareholder Consent, unless the transferee obtains a proxy to vote those shares, such WODI shareholder would retain their right to submit a written consent, but will transfer ownership of the shares and will not hold an interest in WODI after the Business Combination is consummated. 

 

Q:When is the Business Combination expected to be completed? 

A:The Closing is expected to take place (a) as promptly as practicable, but in no event later than the third business day following the satisfaction or waiver of the conditions described in Article VI of the Business Combination Agreement or (b) such other date as agreed to by the parties to the Business Combination Agreement in writing, in each case subject to the satisfaction or waiver of the Closing conditions. The Business Combination Agreement may be terminated by either FRLA or WODI if the Business Combination is not consummated on or before the Outside Date, subject to certain exceptions. For a description of the conditions to the completion of the Business Combination, see the section titled “FRLA Proposal 1 – The FRLA Business Combination Proposal — The Business Combination Agreement — Conditions to the Closing of the Business Combination.” 

 

Q:Are there risks associated with the Business Combination that I should consider in deciding how to vote? 

A:Yes. There are a number of risks related to the Business Combination and other transactions contemplated by the Business Combination Agreement that are discussed in this proxy statement/prospectus/consent solicitation statement. Please read with particular care the detailed description of the risks described in “Risk Factors” beginning on page 34 of this proxy statement/prospectus/consent solicitation statement. 

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Q:May FRLA stockholders seek statutory appraisal rights or dissenter rights with respect to their FRLA shares? 

A:No. Appraisal rights are not available to holders of shares of common stock of FRLA in connection with the proposed Business Combination. For additional information, see the section titled “The FRLA Special Meeting — No Appraisal Rights.” 

 

Q:May WODI shareholders dissent and require appraisal of their shares? 

A:Holders of shares of WODI stock who (i) do not consent to the adoption of the Business Combination Agreement, (ii) follow the procedures set forth in Section 21.460 of the TBOC (including making a written demand of appraisal to WODI within 20 days after the date of mailing of the notice of appraisal rights) and (iii) have not otherwise waived the appraisal rights, will be entitled, under Section 21.460 of the TBOC, to have their shares appraised by a court of appropriate jurisdiction and to receive payment in cash of the “fair value” of the shares, exclusive of any element of value arising from the accomplishment or expectation of the Business Combination, together with interest, if any, to be paid on the amount determined to be “fair value”. The “fair value” of their shares as so determined could be more than, the same as or less than the consideration payable pursuant to the Business Combination Agreement. Failure to follow the procedures specified under Section 21.460 of the TBOC may result in the loss of appraisal rights. See “No Appraisal Rights” herein and Section 21.460 of the TBOC attached as Annex F. 

 

Q:What happens if the Business Combination is not consummated? 

A:If FRLA does not consummate the Business Combination by November 5, 2024, then pursuant to Article IX of its Current Charter, FRLA’s officers must take all actions necessary in accordance with the Delaware General Corporation Law to dissolve and liquidate FRLA as soon as reasonably possible. Following dissolution, FRLA will no longer exist as a company. In any liquidation, the funds held in the Trust Account, plus any interest earned thereon (net of taxes payable), together with any remaining out-of-trust net assets, will be distributed pro-rata to holders of the Public Shares. The estimated consideration that each share of common stock would be paid at liquidation would be approximately $[     ] per share for stockholders based on amounts on deposit in the Trust Account as of [     ], 2024. The closing price of our common stock on the Nasdaq Stock Market as of [     ], 2024 was $[     ]. The Initial Stockholders waived the right to any liquidation distribution with respect to any shares of common stock held by them. 

 

Q:What happens to the funds deposited in the Trust Account following the Business Combination? 

A:Following the Closing of the Business Combination, holders of Public Shares exercising redemption rights will receive their per share redemption price out of the funds in the Trust Account. The balance of the funds will be released to WODI to fund working capital needs of the Combined Company. As of [     ], 2024, there was approximately $[     ] in the Trust Account. FRLA estimates that approximately $[     ] per outstanding Public Share will be paid to the investors exercising their redemption rights. 

 

Q:Who will manage the Combined Company after the Business Combination? 

A:As a condition to the Closing of the Business Combination, all of the officers and directors of FRLA will resign. For information on the anticipated management of the Combined Company, see the section titled “Directors and Executive Officers of the Combined Company After the Business Combination” in this proxy statement/prospectus/consent solicitation statement. 

 

Q:Who can help answer my questions? 

A:If you have questions about the Proposals or if you need additional copies of this proxy statement/prospectus/consent solicitation statement, the enclosed proxy card or the WODI Shareholder Consent, please contact our proxy solicitor: 

For FRLA Stockholders: [     ]

For WODI Shareholders: Jon Peraza at jon@originclear.com

You may also obtain additional information about FRLA from documents filed with the SEC by following the instructions in the section titled “Where You Can Find More Information.”

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SUMMARY OF THE PROXY STATEMENT

This summary highlights selected information from this proxy statement/prospectus/consent solicitation statement but may not contain all of the information that may be important to you. Accordingly, FRLA encourages you to read carefully this entire proxy statement, including the Business Combination Agreement attached as Annex A. Please read these documents carefully as they are the legal documents that govern the Business Combination and your rights in the Business Combination.

 

Unless otherwise specified, all share calculations assume no exercise of the redemption rights by FRLA’s stockholders.

 

The Parties to the Business Combination

Fortune Rise Acquisition Corporation

Fortune Rise Acquisition Corporation (“FRLA”) was incorporated as a blank check company formed under the laws of the State of Delaware on February 1, 2021. FRLA was formed for the purpose of entering into a merger, share exchange, asset acquisition, stock purchase, recapitalization, reorganization or other similar business combination with one or more businesses or entities. FRLA’s sponsor is Fortune Rise Sponsor, LLC, a Delaware limited liability company (the “Sponsor”).

On November 5, 2021, FRLA consummated its initial public offering (“IPO”) of 9,775,000 units (the “Public Units”), consisting of one share of Class A common stock, par value $0.0001 per share (the “FRLA Class A Common Stock”) and one-half of one redeemable warrant to purchase one share of FRLA Class A Common Stock for $11.50 per share (the “Public Warrants”), at $10.00 per Unit, including 1,275,000 Public Units issued pursuant to the underwriters’ full exercise of the over-allotment option, generating gross proceeds of $97,750,000. Simultaneously with the closing of the IPO, FRLA consummated the sale of 545,500 shares of FRLA Class A Common Stock (the “Private Placement Shares”) at a price of $10.00 per Private Placement Share in a private placement to the Sponsor and Representatives, generating gross proceeds of $5,455,000.

After deducting the underwriting discounts, offering expenses, and commissions from the IPO and the sale of the Private Placement Shares, a total of $99,705,000 was deposited into the FRLA’s trust account (the “Trust Account”), maintained by Wilmington Trust, National Association as trustee.

The amounts held in the Trust Account may only be used by FRLA upon the consummation of a business combination, except that there can be released to FRLA, from time to time, any interest earned on the funds in the Trust Account that it may need to pay its tax obligations. The remaining interest earned on the funds in the Trust Account will not be released until the earlier of the completion of a business combination or FRLA’s liquidation.

On December 22, 2022, Water on Demand, Inc., a Nevada corporation, acquired all of membership interests of the Sponsor.

On October 24, 2023, FRLA and Water on Demand, Inc., a Texas corporation (“WODI”) entered into a Business Combination Agreement (the “Business Combination Agreement”). FRLA must liquidate unless it consummates its initial business combination by November 5, 2024.

As of September 30, 2023, FRLA had cash outside the Trust Account of $111,745 available for its working capital needs. As of September 30, 2023, there was $39.5 million held in the Trust Account.

The FRLA Class A Common Stock, Public Units, and Public Warrants are currently listed on the Nasdaq Stock Market, under the symbols “FRLA,” “FRLAU,” and “FRLAW,” respectively. The FRLA Class A Common Stock and Public Warrants commenced trading on the Nasdaq Stock Market separately on or about December 22, 2021.

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FRLA’s principal executive offices are located at 13575 58^th Street North, Suite 200, Clearwater, Florida 33760 and its telephone number is 727-440-4603.

Water on Demand, Inc. (formerly, Progressive Water Treatment, Inc.)

Water on Demand, Inc. (“WODI”) is an enterprise of companies organized by OriginClear, Inc., a Nevada public corporation (“OCLN”). WODI designs, manufactures installs and maintains a complete line of water treatment systems for municipal, industrial and pure water applications using a wide range of technologies, including chemical injection, media filters, membrane, ion exchange and SCADA (supervisory control and data acquisition) technology in turnkey systems.

WODI was formed as Progressive Water Treatment, Inc. in 2000 as a Texas corporation and was acquired by OCLN in 2015. In September 2023, WODI merged with Water on Demand, Inc., a Nevada corporation (“WODI NV”), a pay-as-you-go water financing company which was also a former subsidiary of OCLN. As a result of the merger, Progressive Water Treatment, Inc. changed its name to Water on Demand, Inc.

For more information on WODI, please see the sections titled “Information about WODI” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations of WODI.”

Merger Sub

FRLA Merger Sub, Inc. (“Merger Sub”) is a Delaware corporation and is a wholly-owned subsidiary of FRLA formed to consummate the Business Combination. Pursuant to the Business Combination Agreement, FRLA Merger Sub will merge with and into WODI, with WODI surviving the merger as a wholly-owned subsidiary of FRLA.

The Business Combination Agreement

On October 24, 2023, FRLA entered into the Business Combination Agreement by and among FRLA, Merger Sub and WODI, which was amended on February 6, 2024. Pursuant to the terms of the agreement, a business combination between FRLA and WODI will be effected through the merger of Merger Sub with and into WODI (the “Merger”), with WODI surviving the merger as a wholly-owned subsidiary of FRLA (the “Combined Company”). The Combined Company will change its name to “Water on Demand, Inc.” The Merger and the other transactions contemplated by the Business Combination Agreement are hereinafter referred to as the “Business Combination.” The Board of Directors of FRLA (the “FRLA Board”) has (i) approved and declared advisable the Business Combination Agreement, the Business Combination and the other transactions contemplated thereby and (ii) recommended approval of the Business Combination Agreement and related matters by the stockholders of FRLA.

Merger Consideration

If the FRLA Business Combination Proposal is approved, pursuant to the Business Combination Agreement, at the Effective Time, (A) each share of FRLA Class A Common Stock and each share of FRLA Class B Common Stock (other than such shares of FRLA Class B Common Stock held by the Sponsor which were forfeited pursuant to the Sponsor Letter Agreement) that is issued and outstanding immediately prior to the Merger shall become one share of Common Stock, (B) each share of capital stock of Merger Sub issued and outstanding immediately prior to the Effective Time will be automatically cancelled and extinguished and converted into one share of WODI Common Stock; (C) each share of WODI Preferred Stock shall convert to WODI Common Stock in accordance with the terms thereof immediately prior to the Effective Time; (D) each share of WODI Common Stock (other than the WODI Common Stock held as treasury stock by WODI) issued and outstanding as of immediately prior to the Effective Time shall be automatically canceled and extinguished and converted into the right to receive that number shares of Common Stock equal to the Merger Consideration (as defined below); (E) any shares of WODI Common Stock that are restricted or subject to vesting shall automatically vest and be converted into shares of Common Stock granted as

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part of the Merger Consideration; (F) certain convertible promissory notes issued by WODI shall convert into shares of WODI Common Stock; and (G) each share of WODI Common Stock held by WODI as treasury stock immediately prior to the Effective Time will be automatically canceled and extinguished, and no consideration shall be paid with respect thereto.

WODI shareholders shall be entitled to, with respect to each outstanding share of WODI Common Stock, a number of shares of Common Stock, equal to the Exchange Ratio (the “Merger Consideration,” and the shares of Common Stock issued as Merger Consideration, the “Merger Consideration Shares”), where the Exchange Ratio is equal to the quotient of (A) (i) $32,000,000, divided by (ii) the sum of the aggregate number of shares of WODI Common Stock outstanding immediately prior to the Effective Time, and (B) (i) the aggregate amount of cash on deposit in the Trust Account (without giving effect to the redemption of any shares by FRLA’s public stockholders) as of two business days prior to the Closing Date, including interest not previously released to FRLA to pay taxes of FRLA divided by (ii) the total number of then issued and outstanding FRLA Class A Common Stock (without giving effect to the redemption of any shares by FRLA’s public stockholders).

The total consideration to be received by WODI Security Holders at the Closing will be the issue of Common Stock with an aggregate value equal to $32,000,000.

Closing

In accordance with the terms and subject to the conditions of the Business Combination Agreement, the Closing will take place on the date that is no later than the third business day after the satisfaction or waiver of the conditions set forth in the Business Combination Agreement (other than those conditions that by their nature are to be satisfied at the Closing, but subject to the satisfaction or waiver of those conditions), unless another time or date is mutually agreed to in writing by the parties. The date on which the Closing actually occurs is referred to as the “Closing Date.”

Representations and Warranties

The Business Combination Agreement contains representations and warranties of WODI relating to, among other things, corporate existence and power, corporate authorization, capitalization, indebtedness, non-contravention, consents, capital structure, organizational documents, assumed names, subsidiaries, financial statements, absence of certain changes, properties, title to WODI’s assets, litigation, contracts, licenses and permits, compliance with laws, intellectual property, customers and suppliers, employees and employee benefit plans, withholding, labor matters, real and personal property, tax matters, environmental laws, finder’s fees, directors and officers, certain business practices, international trade matters, anti-bribery compliance, compliance with health care laws and certain contracts, insurance, related party transactions and data privacy matters.

The Business Combination Agreement contains representations and warranties of FRLA and Merger Sub relating to, among other things, corporate existence and power, corporate authorization, governmental authorization, non-contravention, finder’s fees, issuance of shares, capitalization, information supplied, FRLA’s Trust Account, related party transactions, listing, board approval, internal controls, financial statements, absence of changes, litigation, compliance with laws, tax matters, and contracts.

None of the representations, warranties or covenants, including any rights upon breach of such representations, warranties or covenants will survive the Closing except for such covenants and agreements that by their terms expressly apply post-Closing.

Covenants

The Business Combination Agreement includes customary covenants of the parties with respect to operation of their respective businesses prior to consummation of the Business Combination and efforts to satisfy conditions to consummation of the Business Combination. The Business Combination Agreement also contains additional

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covenants of the parties, including, among others, those with respect to access to certain information, notification of the occurrence of certain facts and circumstances, listing, indemnification, directors’ and officers’ insurance, and cooperation in the preparation of this proxy statement/prospectus/consent solicitation statement.

Conditions to Closing

The consummation of the Business Combination is conditioned upon, among other things, (i) the absence of any applicable law or order restraining, prohibiting or imposing any condition on the consummation of the Business Combination and related transactions, (ii) the Form S-4 becoming effective in accordance with the provisions of the Securities Act, (iii) the conditional approval for listing by Nasdaq of the shares of Common Stock to be issued in connection with the transactions contemplated by the Business Combination Agreement and satisfaction of initial and continued listing requirements, (iv) the election of certain individuals to the FRLA Board as set forth in the Business Combination Agreement, (v) approval by FRLA stockholders of the Business Combination and related transactions, (vi) approval by the WODI shareholders of the Business Combination and related transactions, (vii) solely with respect to FRLA and Merger Sub, (A) the fundamental representations and warranties of WODI being true and correct in all respects unless failure would not have or reasonably be expected to have a Material Adverse Effect (as defined in the Business Combination Agreement) on WODI or any of its subsidiaries, (B) WODI having duly performed or complied with all of its obligations under the Business Combination Agreement in all material respects, and (C) no event having occurred that would result in a Material Adverse Effect on WODI or any of its subsidiaries, and (viii) solely with respect to WODI, (A) the fundamental representations and warranties of FRLA and Merger Sub being true and correct in all respects unless failure would not have or reasonably be expected to have a Material Adverse Effect (as defined in the Business Combination Agreement) on FRLA or Merger Sub, and (B) FRLA and Merger Sub having duly performed or complied with all of their respective obligations under the Business Combination Agreement in all material respects.

Termination

The Business Combination Agreement may be terminated at any time prior to the Effective Time as follows:

(i)by mutual written consent of FRLA and WODI; 

(ii)by either FRLA or WODI if the other party has breached any of its covenants or representations and warranties such that closing conditions would not be satisfied by the earlier of (A) the Outside Date and (B) 30 days following receipt by the breaching party of a written notice of the breach 

(iii)by either FRLA or WODI if the Business Combination and related transactions are not consummated on or before the Outside Date, provided that, no party shall have the right to terminate the agreement for this cause if their own breach of covenants or obligations under the Business Combination Agreement was the proximate cause of the failure to consummate the Business Combination prior to the Outside Date; 

(iv)by either FRLA or WODI, if any Governmental Entity shall have issued an Order or taken any other action permanently enjoining, restraining or otherwise prohibiting the transactions contemplated by this Agreement and such Order or other action shall have become final and non-appealable; 

(v)by either FRLA or WODI if the FRLA Special Meeting, has been held (including any adjournment thereof), has concluded, and either FRLA’s stockholders have duly voted and failed to approve the Business Combination Agreement, the Business Combination and the related transactions or if WODI fails to obtain the approval of the WODI shareholders by the WODI Shareholder Consent; 

(vi)by WODI should FRLA not have timely taken such actions as are reasonably necessary pursuant to the Trust Agreement and the Governing Documents of FRLA to extend the period of time for it to  

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complete an initial business combination for an additional period of an aggregate of six (6) months from November 5, 2023; provided, that WODI timely deposit into the Trust Account the funds required for such extension by the Trust Agreement;

(vii)by FRLA should WODI not deposit into the Trust Account in a timely manner the funds necessary to extend the period for FRLA to complete an initial business combination for an additional period of an aggregate of six (6) months from November 5, 2023; and 

(viii)by FRLA should: (i) Nasdaq not approve the initial listing application for the Combined Company with Nasdaq in connection with the transactions contemplated by the Business Combination Agreement; (ii) the Combined Company not have satisfied all applicable initial listing requirements of Nasdaq; or (iii) the common stock of the Combined Company not have been approved for listing on Nasdaq prior to the Closing Date. 

Certain Related Agreements

Sponsor Letter Agreement. Concurrently with the execution of the Business Combination Agreement, the Sponsor, FRLA and WODI entered into a Letter Agreement (the “Sponsor Letter Agreement”), pursuant to which, among other things, the Sponsor agreed to (a) vote in favor of the Business Combination Agreement and the Business Combination, (b) waive any adjustment to the conversion ratio set forth in the Certificate of Incorporation or other governing documents of FRLA or any other anti-dilution or similar protection with respect to the FRLA Class B Common Stock, such that the FRLA Class B Common Stock will convert into Common Stock at the Closing on a one-to-one basis, and (c) subject certain of the FRLA Class B Common Stock currently held by the Sponsor to potential forfeiture, in each case, on the terms and subject to the conditions set forth in the Sponsor Letter Agreement.

Incentive Plan. FRLA has agreed to approve and adopt an equity incentive plan (the “Incentive Plan”) to be effective as of the Closing and in a form mutually acceptable to FRLA and WODI, subject to approval of the Incentive Plan by the FRLA’s stockholders. The Incentive Plan will provide for an initial aggregate share reserve equal to 10% of the number of shares of common stock on a fully diluted basis at the Closing.

Management

Effective as of the Closing, the Combined Company’s Board of Directors will have seven (7) directors, who will initially be T. Riggs Eckelberry, Stephen Hall, Taron Lexton, Beau Vuillemot, Leslie Brock, and Jean-Louis Kindler. All of the executive officers of FRLA shall resign and the individuals serving as executive officers of the Combined Company immediately after the Closing will be the same individuals (in the same offices) as those of WODI immediately prior to the Closing. See the section titled “Directors and Executive Officers of the Combined Company After the Business Combination” for additional information.

Voting Securities

As of the Record Date, there were 6,271,798 FRLA Shares issued and outstanding. Only FRLA stockholders who hold shares of common stock of record as of the close of business on [     ], 2024 are entitled to vote at the FRLA Special Meeting or any adjournment thereof. Approval of the FRLA Business Combination Proposal, the FRLA Incentive Plan Proposal, the FRLA Nasdaq Proposal, and the FRLA Adjournment Proposal will each require the affirmative vote of the holders of a majority of the issued and outstanding shares of common stock present in person by virtual attendance or represented by proxy and entitled to vote at the FRLA Special Meeting or any adjournment thereof. Approval of the FRLA Charter Amendment Proposal will require the affirmative vote of a majority of the issued and outstanding shares of common stock. Directors are elected by a plurality of all of the votes cast by the stockholders present in person (which would include presence at a virtual meeting) or represented by proxy at the FRLA Special Meeting. This means that the six director nominees who receive the most affirmative votes will be elected.

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Attending the FRLA Special Meeting either in person by virtual attendance or by submitting your proxy and abstaining from voting will have the same effect as voting against all the Proposals and, assuming a quorum is present, broker non-votes will have no effect on the Proposals, other than the FRLA Charter Amendment Proposal, for which it will have the same effect as voting against the Proposal.

With respect to the Business Combination, pursuant to the Letter Agreement, the Sponsor, holding an aggregate of 2,283,750 FRLA Shares (or approximately 36% of the outstanding FRLA Shares), has agreed to vote its FRLA Shares in favor of each of the Proposals. As a result, only 26,650 Public Shares will need to be present in person by virtual attendance or by proxy to satisfy the quorum requirement for the meeting. In addition, as the vote to approve the Business Combination Proposal is a majority of the votes cast at a meeting at which a quorum is present, assuming only the minimum number of FRLA Shares to constitute a quorum is present, no Public Shares must vote in favor of the Business Combination Proposal for it to be approved.

Appraisal Rights

Appraisal rights are not available to holders of FRLA Shares in connection with the proposed Business Combination under Delaware law. If the Business Combination is completed, WODI shareholders who do not deliver a written consent approving the Business Combination are entitled to appraisal rights under Section 21.460 of the TBOC (“Section 21.460”) provided that they comply with the conditions established by Section 21.460. For more information about such rights see the provisions of Section 21.460 of the TBOC attached hereto as Annex E, and the section entitled “No Appraisal Rights”.

Redemption Rights

Pursuant to FRLA’s Current Charter, holders of Public Shares may elect to have their shares redeemed for cash at the applicable redemption price per share equal to the quotient obtained by dividing (i) the aggregate amount on deposit in the Trust Account as of two business days prior to the consummation of the Business Combination, including interest (net of taxes payable), by (ii) the total number of then-outstanding Public Shares. As of [     ], 2024, this would have amounted to approximately $[     ] per share.

You will be entitled to receive cash for any Public Shares to be redeemed only if you: (i) hold Public Shares, or; and (ii) prior to [     ], Eastern Time, on [     ], 2024, (a) submit a written request to VStock that FRLA redeem your Public Shares for cash and (b) deliver your Public Shares to VStock, physically or electronically through DTC.

If a holder exercises their redemption rights, then such holder will be exchanging their Public Shares for cash and will no longer own shares of the Combined Company. Such a holder will be entitled to receive cash for its Public Shares only if it properly demands redemption and delivers its Public Shares (either physically or electronically) to VStock in accordance with the procedures described herein. Please see the section titled “The FRLA Special Meeting — Redemption Rights” for the procedures to be followed if you wish to redeem your Public Shares for cash.

Ownership of the Post-Business Combination Company After the Closing

It is anticipated that, upon the Closing of the Business Combination, FRLA’s public stockholders will retain an ownership interest of approximately 38.1% in the Combined Company, the Sponsor and directors of FRLA will retain an ownership interest of approximately 17.7% in the Combined Company, the Representatives will retain an ownership interest of approximately 1.4% in the Combined Company, and the WODI shareholders will own approximately 42.8% of the outstanding common stock of the Combined Company. The ownership percentages with respect to the Combined Company assumes (i) there are no redemptions of any shares by the FRLA’s public stockholders, and (ii) there are no issuances of any additional shares upon the Closing of the Business Combination under the Incentive Plan.

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The following table illustrates varying ownership levels in the Combined Company, assuming no redemptions by FRLA public stockholders, 25% redemption by FRLA public stockholders, 50% redemption by FRLA public stockholders, 75% redemption by FRLA public stockholders and the maximum redemptions by FRLA public stockholders:

		Scenario 1 Assuming No Redemptions				Scenario 2 Assuming 25% Redemptions
Equity Capitalization Summary		Shares		%		Shares		%
WODI Shareholders		3,542,691		42.8%		3,542,691		47.2%
FRLA Public Stockholders		3,162,548		38.1%		2,371,911		31.6%
FRLA Initial Stockholders(a)		1,466,750		17.7%		1,466,750		19.6%
Representatives Shares		120,000		1.4%		120,000		1.6%
Total Common Stock		8,291,989		100.0%		7,501,352		100.0%

 

		Scenario 3 Assuming 50% Redemptions				Scenario 4 Assuming 75% Redemptions
Equity Capitalization Summary		Shares		%		Shares		%
WODI Shareholders		3,542,691		52.7%		3,542,691		59.8%
FRLA Public Stockholders		1,581,274		23.6%		790,637		13.4%
FRLA Initial Stockholders(a)		1,466,750		21.9%		1,466,750		24.8%
Representatives Shares		120,000		1.8%		120,000		2.0%
Total Common Stock		6,710,715		100.0%		5,920,078		100.0%

 

		Scenario 5 Assuming Maximum Redemptions
Equity Capitalization Summary		Shares		%
WODI Shareholders		3,542,691		69.1%
FRLA Public Stockholders		-		-%
FRLA Initial Stockholders(a)		1,466,750		28.6%
Representatives Shares		120,000		2.3%
Total Common Stock		5,129,441		100.0%

 

 

(a)Including forfeiture of 1,522,500 shares of FRLA Class B Common Stock owned by FRLA Sponsor pursuant to the Sponsor Letter Agreement.   

 

All of the relative percentages above are for illustrative purposes only and are based upon certain assumptions as described in the section entitled “Certain Defined Terms — Share Calculations and Ownership Percentages” and, with respect to the determination of the “maximum redemptions,” the section entitled “Unaudited Pro Forma Condensed Combined Financial Information.” Should one or more of the assumptions prove incorrect, actual ownership percentages may vary materially from those described in this proxy statement/prospectus/consent

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solicitation statement as anticipated, believed, estimated, expected or intended. See “Unaudited Pro Forma Condensed Combined Financial Information.”

Interests of Certain Persons in the Business Combination

When you consider the recommendation of the Board in favor of adoption of the Business Combination Proposal and other Proposals, you should keep in mind that FRLA’s directors and officers have interests in the Business Combination that are different from, or in addition to, your interests as a shareholder, including:

·If an initial business combination, such as the Business Combination, is not completed by November 5, 2024, FRLA will be required to dissolve and liquidate. In such event, the 2,443,750 Founder Shares currently held by the Initial Stockholders (including FRLA’s directors and officers), which were acquired prior to the IPO will be worthless because such holders have agreed to waive their rights to any liquidation distributions. The Founder Shares were purchased for an aggregate purchase price of $25,000. 

·The exercise of FRLA’s directors’ and officers’ discretion in agreeing to changes or waivers in the terms of the transaction may result in a conflict of interest when determining whether such changes or waivers are appropriate and in our stockholders’ best interest. 

See “FRLA Proposal 1 – The FRLA Business Combination Proposal— Interests of FRLA’s Directors and Officers in the Business Combination” For additional information.

Anticipated Accounting Treatment

The Business Combination will be accounted for as a “reverse recapitalization,” with no goodwill or other intangible assets recorded, in accordance with GAAP. A reverse recapitalization does not result in a new basis of accounting, and the financial statements of the combined entity represent the continuation of the financial statements of WODI in many respects.

Under this method of accounting, FRLA will be treated as the “acquired” company for financial reporting purposes. For accounting purposes, WODI will be deemed to be the accounting acquirer in the transaction and, consequently, the transaction will be treated as a recapitalization of WODI (i.e., a capital transaction involving the issuance of stock by FRLA for the stock of WODI). Accordingly, the consolidated assets, liabilities and results of operations of WODI will become the historical financial statements of the Combined Company, and FRLA’s assets, liabilities and results of operations will be consolidated with WODI’s beginning on the acquisition date. Operations prior to the Business Combination will be presented as those of WODI in future reports. The net assets of WODI will be recognized at carrying value, with no goodwill or other intangible assets recorded.

Recommendations of the Boards and Reasons for the Business Combination

After careful consideration of the terms and conditions of the Business Combination Agreement, the Boards, as applicable, have determined that Business Combination and the transactions contemplated thereby are fair to, and in the best interests of, FRLA, WODI and their respective stockholders. In reaching their decision with respect to the Business Combination and the transactions contemplated thereby, the Boards reviewed various industry and financial data and the evaluation of materials provided by WODI and FRLA.

The FRLA Board recommends that FRLA stockholders vote:

·FOR the FRLA Business Combination Proposal; 

·FOR the FRLA Charter Amendment Proposal; 

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·FOR each of the FRLA Advisory Charter Proposals; 

·FOR the FRLA Incentive Plan Proposal; 

·FOR the FRLA Director Election Proposal; 

·FOR the FRLA Nasdaq Proposal; and 

·FOR the FRLA Adjournment Proposal. 

 

The WODI Board recommends that WODI shareholders vote:

·To approve the Business Combination, the Business Combination Agreement and the other transactions contemplated therein. 

Summary Risk Factors

In evaluating the Business Combination and the Proposals to be considered and voted on at the FRLA Special Meeting and the WODI Shareholder Consent, you should carefully review and consider the risk factors set forth under the section titled “Risk Factors” beginning on page 33 of this proxy statement/prospectus/consent solicitation statement. Some of these risks related to are summarized below. References in the summary below to “WODI” generally refer to WODI in the present tense or the Combined Company from and after the Business Combination.

The following summarizes certain principal factors that make an investment in the Combined Company speculative or risky, all of which are more fully described in the “Risk Factors” section below. This summary should be read in conjunction with the “Risk Factors” section and should not be relied upon as an exhaustive summary of the material risks facing FRLA’s, WODI’s and/or the Combined Company’s business.

    Risks Related to WODI’s Business

·WODI has a limited operating history by which performance can be gauged. 

·WODI is subject to potential fluctuations in operating results. 

·WODI’s future operating results are difficult to predict and may be affected by a number of factors, many of which are outside of WODI’s control. 

·Unanticipated obstacles may hinder the execution of WODI’s business plan. 

·WODI has limited market acceptance of our services. 

·WODI cannot assure you that it will effectively manage its growth. 

·WODI’s costs may grow more quickly than its revenues, harming our business and profitability. 

·The loss of one or more of WODI’s key personnel, or our failure to attract and retain other highly qualified personnel in the future, could harm WODI’s business. 

·Acquisition activity presents certain risks to WODI’s business, operations and financial condition, and WODI may not realize the financial and strategic goals contemplated at the time of a transaction. 

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·If WODI is unable to protect its intellectual property, the value of its brand and other intangible assets may be diminished and our business may be adversely affected. 

·WODI’s financial results will fluctuate in the future, which makes them difficult to predict. 

·WODI may face additional competition. 

·WODI has either realized a gross and net loss or had limited profitability for each period since its inception to date, and there can be no assurances that WODI will become profitable in the future. 

·WODI is controlled by its parent, OriginClear, Inc. (OCLN), which also provides all funding, sales and administrative resources. 

·Actual or threatened epidemics, pandemics, outbreaks, or other public health crises may adversely affect our business, including the novel COVID-19 outbreak. 

    Risks Related to WODI’s and FRLA’s Business

·Failure to comply with applicable anti-corruption legislation and other governmental laws and regulations could result in fines, criminal penalties and materially adversely affect its business, financial condition and results of operations. 

·FRLA will be forced to liquidate the Trust Account if it cannot consummate a business combination by November 5, 2024. In the event of a liquidation, FRLA’s public stockholders will receive their pro rata share of the Trust Account and the Public Warrants will expire worthless. 

    Risks Related to FRLA’s Business and the Business Combination

·You must tender your Public Shares in order to validly seek redemption at the FRLA Special Meeting of stockholders. 

·If third parties bring claims against FRLA, the proceeds held in trust could be reduced and the per-Public Share liquidation price received by FRLA’s stockholders may be less than $10.00. 

·Any distributions received by FRLA stockholders could be viewed as an unlawful payment if it was proved that immediately following the date on which the distribution was made, FRLA was unable to pay its debts as they fell due in the ordinary course of business. 

·If FRLA’s due diligence investigation of WODI was inadequate, then stockholders of FRLA following the Business Combination could lose some or all of their investment. 

    Risks Related to the Combined Company’s Common Stock

·The market price of the Combined Company’s Common Stock is likely to be highly volatile, and you may lose some or all of your investment. 

·Volatility in the Combined Company’s share price could subject the Combined Company to securities class action litigation. 

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SUMMARY HISTORICAL FINANCIAL INFORMATION OF FRLA

FRLA’s statement of operations data for the nine months ended September 30, 2023 and balance sheet data as of September 30, 2023 are derived from FRLA’s unaudited financial statements included elsewhere in this registration statement. FRLA’s statement of operations data for the year ended December 31, 2022 and for the period from February 1, 2021 (inception) through December 31, 2021 and balance sheet data as of December 31, 2022 and 2021 are derived from FRLA’s audited financial statements included elsewhere in this proxy statement/prospectus/consent solicitation statement.

The historical results of FRLA included below and elsewhere in this proxy statement/prospectus/consent solicitation statement are not necessarily indicative of the future performance of FRLA. You should read the following selected financial data in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations of FRLA” and the financial statements and the related notes appearing elsewhere in this proxy statement/prospectus/consent solicitation statement.

Statements of Operations Data:		For the Nine Months Ended September 30, 2023				For the Nine Months Ended September 30, 2022					For the Year Ended December 31, 2022		For the Period from February 1, 2021 (inception) through December 31, 2021
		(Unaudited)				(Unaudited)
Formation and operating costs		$	(1,353,037	)		$	(731,906)			$	(959,457)		$	(97,513	)
Franchise tax expenses			(110,400	)			(145,200)				(199,759)			(35,961	)
Other income			2,342,684				600,565				1,466,677			1,310
Provision for income taxes			(487,585	)			-				(355,070)			-
Net income (loss)		$	391,662			$	(276,541)			$	(47,609)		$	(132,164)
Basic and diluted weighted average shares outstanding, common stock subject to possible redemption			6,194,831				9,775,000				9,775,000			1,643,844
Basic and diluted net income (loss) per share, common stock subject to possible redemption		$	0.23			$	(0.01)			$	0.04		$	4.20
Basic and diluted weighted average shares outstanding, common stock attributable to FRLA			3,109,250				3,109,250				3,109,250			2,290,520
Basic and diluted net loss per share, common stock attributable to FRLA		$	(0.33	)		$	(0.05	)		$	(0.15	)	$	(3.07	)
Cash Flows Data:
Net cash used in operating activities		$	(2,592,619	)		$	(616,202	)		$	(689,068)		$	(276,811	)
Net cash provided by (used in) investing activities		$	64,749,327			$	-			$	(769,539)		$	(99,705,000	)
Net cash (used in) provided by financing activities		$	(62,217,277	)		$	-			$	783,750		$	100,828,982

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Balance Sheets Data:		As of September 30, 2023				As of December 31, 2022					As of December 31, 2021
		(Unaudited)
Cash		$	111,745			$	172,314		$	847,171
Other current assets			192,772				29,000			187,500
Investments held in Trust Account			39,535,883				101,942,526			99,706,310
Total assets		$	39,840,400			$	102,143,840		$	100,740,981
Total liabilities		$	8,303,324			$	4,915,881		$	3,465,413
Class A common stock subject to possible redemption		$	39,583,698			$	101,559,697		$	99,705,000
Total stockholders’ deficit		$	(8,046,622	)		$	(4,331,738	)	$	(2,429,432)

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SUMMARY HISTORICAL FINANCIAL INFORMATION OF WODI

The following table contains selected historical consolidated financial data of Water on Demand, Inc. (formerly Progressive Water Treatment Inc.) (“WODI (TX)”) as of and for the years ended December 31, 2022 and 2021 and the combined entity (WODI (TX) and Water on Demand, Inc., a Nevada corporation (“WODI (NV)”, and together with WODI (TX), “WODI Combined”) for the interim periods ended September 30, 2023 and both WODI (TX) and WODI (NV) for the period ended September 30, 2022. Such data as of and for the years ended December 31, 2022 and 2021 have been derived from the audited financial statements of WODI, which are included elsewhere in this proxy statement/prospectus/consent solicitation statement. The summary consolidated statements of operations data for the nine months ended September 2023 and 2022 and the summary consolidated balance sheet data as of September 30, 2022 and September 30, 2023 are derived from WODI’s unaudited consolidated financial statements appearing elsewhere in this proxy statement/prospectus/consent solicitation statement. The WODI unaudited interim condensed consolidated financial statements were prepared on the same basis as its audited annual financial statements and include all adjustments, consisting only of normal recurring adjustments that are necessary for a fair presentation of the financial information in those statements. The following summary consolidated financial data should be read together with “Management’s Discussion and Analysis of Financial Condition and Results of Operations of WODI” and WODI’s audited financial statements and notes thereto and unaudited interim consolidated financial statements included elsewhere in this proxy statement/prospectus/consent solicitation statement. The summary consolidated financial data in this section are not intended to replace our audited consolidated financial statements and unaudited condensed consolidated financial statements and related notes and are qualified in their entirety thereby. WODI’s historical results are not necessarily indicative of the results that may be expected for any period in the future.

Statements of Operations Data:		WODI Combined For the Nine Months Ended September 30, 2023		WODI (TX) and WODI (NV) For the Nine Months Ended September 30, 2022		WODI (NV)   For the Year Ended December 31, 2022		WODI (TX) For the  Year Ended December 31, 2022		WODI (TX) For the Year Ended December 31, 2021
		(Unaudited)		(Unaudited)
Sales		$5,181,199		$7,748,414		$-		$10,350,281		$4,116,662
Gross profit		$534,850		1,264,179		-		1,469,005		542,602
Total operating expenses		$912,911		745,384		205,250		1,153,815		747,216
Total other income (expenses)		$(12,069,721)		(21,126)		(742,258)		311,264		231,421
Net income (loss)		$(12,447,782)		$497,669		$(947,508)		$626,454		$26,807
Basic and diluted weighted average shares outstanding, common stock		9,614,230		1,551,697		5,000,000		779,638		779,638
Basic and diluted net income (loss) per share, common stock		$(1.29)		$0.32		$(0.19)		$0.80		$0.03

 

Balance Sheets Data:		WODI Combined as of September 30, 2023		WODI (NV) as of December 31, 2022		WODI (TX) as of December 31, 2022		WODI (TX) as of December 31, 2021
		(Unaudited)
Cash		$943,802		$177,588		$386,529		$96,753
Total current assets		$6,921,008		$400,000		$4,677,312		$2,843,802
Total assets		$7,325,118		$577,588		$4,684,698		$2,860,749
Total liabilities		$19,638,166		$1,500,096		$4,258,517		$3,061,022
Total stockholders’ equity (deficit)		$(12,313,048)		$(922,508)		$426,181		$(200,273)

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TRADING MARKET AND DIVIDENDS

FRLA

Public Units, Common Stock, and Public Warrants

The Public Units, Public Shares and Public Warrants are each quoted on the Nasdaq Stock Market, under the symbols “FRLAU,” “FRLA” and “FRLAW,” respectively. Each of FRLA’s Public Units consists of one share of FRLA Class A Common Stock and one-half of one Warrant. Each whole Warrant entitles the holder thereof to purchase one share of FRLA Class A Common Stock at a price of $11.50 per share. The Public Units, Public Shares and Public Warrants commenced trading on the Nasdaq Stock Market separately on or about December 27, 2021. Public stockholders who redeem their Public Shares into their share of the Trust Account still have the right to continue to hold any Public Warrants they hold outside of such Unit; however, no fractional warrants will be issued upon separation of the Public Units and only whole warrants will trade.

FRLA’s Dividend Policy

FRLA has not paid any cash dividends on its shares of common stock to date and does not intend to pay cash dividends prior to the completion of a business combination. The payment of cash dividends in the future will be dependent upon FRLA’s revenues and earnings, if any, capital requirements and general financial condition subsequent to completion of a business combination. Further, if we incur any indebtedness, FRLA’s ability to declare dividends may be limited by restrictive covenants FRLA may agree to in connection therewith. The payment of any dividends subsequent to a business combination will be within the discretion of the Combined Company’s Board of Directors. It is the present intention of the Board to retain all earnings, if any, for use in its business operations and, accordingly, the Board does not anticipate declaring any dividends in the foreseeable future.

WODI

Holders of WODI

As of the WODI Record Date, there were 176 holders of record of WODI common stock (on a converted basis).

Dividend Policy of WODI

WODI has not paid any cash dividends on its stock to date and does not intend to pay cash dividends prior to the completion of the Business Combination.

Combined Company

Dividend Policy

Following completion of the Business Combination, the Combined Company’s Board of Directors will consider whether or not to institute a dividend policy. It is presently intended that the Combined Company retain its earnings for use in business operations and accordingly, we do not anticipate Combined Company’s Board of Directors declaring any dividends in the foreseeable future.

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RISK FACTORS

In addition to the other information contained in this proxy statement/prospectus, including the matters addressed under the heading “Cautionary Note Regarding Forward-Looking Statements,” you should carefully consider the following risk factors in deciding how to vote on the proposals presented in this proxy statement/prospectus/consent solicitation statement. The risk factors described below disclose both material and other risks, and are not intended to be exhaustive and are not the only risks facing us. Additional risks not currently known to us or that we currently deem to be immaterial also may materially adversely affect our business, financial condition, results of operations and cash flows in future periods or are not identified because they are generally common to businesses.

Unless the context otherwise requires, all references in this subsection to “we,” “us” or “our” refer to the business of WODI prior to the Closing and to the Combined Company. The occurrence of one or more of the events or circumstances described in these risk factors, alone or in combination with other events or circumstances, may have a material adverse effect on the business, financial condition, results of operations, cash flows and future prospects of the Combined Company, in which event the market price of the Combined Company’s securities could decline, and you could lose part or all of your investment.

Risks Related to WODI’s Business

WODI’s historical profitability has been limited and would not be enough to offset the costs of the Combined Company.

WODI is currently developing Water On Demand, a new business model to respond to identified market demand. Since WODI has had limited profitability, there are substantial risks, uncertainties, expenses and difficulties that WODI is subject to. To address these risks and uncertainties, WODI must, among other things:

·Successfully execute its business strategy; 

·Respond to competitive developments; and 

·Attract, integrate, retain and motivate qualified personnel. 

There can be no assurance WODI will operate profitably or that WODI will have adequate working capital to meet its obligations as they become due. Investors must consider the risks and difficulties frequently encountered by early stage companies, particularly in rapidly evolving markets. WODI cannot be certain that its business strategy will be successful or that WODI will successfully address these risks. In the event that WODI does not successfully address these risks, our business, prospects, financial condition, and results of operations could be materially and adversely affected.

WODI has incurred a gross loss and net loss since its inception, and while WODI is taking steps to achieve a gross profit and profitability, the Combined Company is expected to continue reporting gross losses and net losses for the foreseeable future. WODI is evaluating and taking a number of near-term actions to achieve a gross profit and work towards profitability post business combination, and expect that as it matures, WODI will obtain expertise, economies of scale and efficiency that should increase revenue and reduce costs over the medium to long-term. However, there can be no assurances that these actions will prove to be effective. If the Combined Company fails to increase its revenue and/or manage its expenses, WODI may not achieve or sustain profitability in the future.

In order to continue operations despite a history of losses or limited profitability, WODI has financed itself through equity offerings.

While WODI has had minimal internal expenses, the activities carried out on its behalf by OCLN since its inception have significantly receded its profitability or resulted in net losses, and WODI expects the Combined Company will

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incur net losses in the future. To date, OCLN has funded its operations from its sale of equity securities in OCLN and WODI. WODI will need to generate significantly increased revenues to achieve profitability. There can be no assurance that the Combined Company will ever generate sufficient revenues to achieve profitability. If WODI does achieve profitability in some future period, WODI cannot assure you that WODI can sustain profitability on a quarterly or annual basis in the future. If its revenues grow more slowly than WODI anticipates or if its operating expenses exceed its expectations or cannot be adjusted accordingly, its business, operating results and financial condition will be materially and adversely affected.

WODI has a limited operating history by which performance can be gauged.

Any evaluation of WODI and its prospects must be considered in light of its lack of operating history and the risks and uncertainties encountered by companies at an early stage of development. Further, its industry is characterized by rapid technological change, changing customer needs, evolving industry standards and frequent introduction of new products and services. WODI have encountered and will continue to encounter risks and difficulties frequently experienced by growing companies in rapidly changing industries. If WODI does not address these risks successfully, its operating results will be harmed.

WODI is subject to potential fluctuations in operating results.

WODI’s sales cycles can be long and unpredictable, and its sales efforts require considerable time and expense. As a result, its sales are difficult to predict and may vary substantially from quarter to quarter, which may cause its operating results to fluctuate significantly. OCLN spends a substantial amount of time, effort and money on its behalf in its sales efforts without any assurance that its efforts will produce any revenue and the timing of its revenue is difficult to predict. Its sales efforts involve educating its customers about the use and benefit of its new products, including their technical capabilities and potential cost savings to the customers. Customers typically undertake a significant evaluation process that has in the past resulted in a lengthy sales cycle. If sales expected from a specific customer for a particular quarter are not realized in that quarter or at all, its business, operating results and financial condition could be materially and adversely affected.

WODI’s future operating results are difficult to predict and may be affected by a number of factors, many of which are outside of WODI’s control.

The market for Design-Build-Own-Operate is relatively new and unproven and is subject to a number of risks and uncertainties. The industry is new and its ability to gain market share depends upon its ability to satisfy customer demands, enhance existing products and services and develop and introduce new products and services. Its ability to gain market share also depends on a number of factors beyond its control, including the perceived value associated with its products and services, the public’s perception of the use of robots to perform tasks traditionally reserved for humans, and its customers’ acceptance that security services can be performed more efficiently and cost-effectively through the use of its products and ancillary services. If any of these factors turns against us, its future operating results could be materially and adversely affected.

Unanticipated obstacles may hinder the execution of WODI’s business plan.

Because of the number and range of the assumptions underlying its projections and forward-looking statements, many of which are subject to significant uncertainties and contingencies that are beyond its reasonable control, some of the assumptions inevitably will not materialize and unanticipated obstacles may occur subsequent to the date of this offering, including:

·WODI’s failure to maintain and grow the client base; 

·WODI’s clients may suffer downturns, financial instability or be subject to mergers or acquisitions; 

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·Adverse litigation judgments, settlements, or other litigation-related costs; and 

·Adverse changes in business or macroeconomic conditions including regulatory changes. 

The occurrence of any of these unanticipated obstacles will hinder the execution of its business plan and adversely affect its operating results.

WODI’s long-term success depends in part on developing a novel outsourcing model, and WODI faces the risks inherent in a performance-based business model.

WODI is developing a new business in the Design-Build-Own-Operate sector, known as “Water On Demand.” WODI plans to generate revenue through the financing and management of these systems, and its long-term success depends on the performance and oversight of these systems. WODI expects that the amount of payments it may receive will be based upon the performance of its operating partners, and so WODI will be dependent on the successful operations of these partners for a significant portion of its revenues. WODI faces risks inherent in such a delegated business model, many of which are outside of its control, including those arising from its reliance on the management and operating capabilities of its operating partners and the cyclicality of supply and demand for end-products produced using this business model. Should its managed contracts fail to achieve sufficient profitability in their operations, its payments would be diminished and its results of operations, cash flows and financial condition could be adversely affected, and any such effects could be material.

WODI may not be able to commercialize its new products which would result in losses and may require us to curtail or cease operations.

WODI is unable to project when its Water On Demand business model will achieve profitability, if at all. WODI cannot assure that its executive resources will be able to develop its systems fast enough to meet market requirements. WODI can also not assure that its systems will gain market acceptance and that it will be able to successfully commercialize the business model. The failure to successfully develop and commercialize the business model would result in continued losses and may require us to curtail or cease operations.

WODI cannot assure you that it will effectively manage its growth.

The growth and expansion of WODI’s business and products create significant challenges for its management, operational, and financial resources, including managing multiple relationships and interactions with users, distributors, vendors, and other third parties. As WODI continues to grow, its information technology systems, internal management processes, internal controls and procedures and production processes may not be adequate to support its operations. To ensure success, WODI must continue to improve its operational, financial, and management processes and systems and to effectively expand, train, and manage its employee base. As WODI continues to grow, and implement more complex organizational and management structures, it may find it increasingly difficult to maintain the benefits of its corporate culture, including its current team’s efficiency and expertise, which could negatively affect its business performance.

The loss of one or more of its key personnel, or its failure to attract and retain other highly qualified personnel in the future, could harm its business.

WODI currently depends on the continued services and performance of key members of the OCLN management team, in particular, its chairman and CEO, T. Riggs Eckelberry; its COO, Tom Marchesello; and its EVP, Kenneth A. Berenger. If WODI cannot call upon them or other key management personnel for any reason, its operations and development could be harmed. WODI has not yet developed a succession plan. Furthermore, as WODI grows, it will be required to invest in qualified professionals such as accounting, legal, finance, production, service and engineering experts, some of which could be provided under a continuing management services contract by OCLN. However, such a management services contract may not materialize or be successful, in which case WODI will need to invest in all

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the above resources itself. WODI may not be able to locate or attract qualified individuals for such positions, which will affect WODI’s ability to grow and expand its business.

Acquisition activity presents certain risks to our business, operations and financial condition, and we may not realize the financial and strategic goals contemplated at the time of a transaction.

We expect that acquisitions will be an important part of our long-term growth strategy. Successful execution following the closing of an acquisition is essential to achieving the anticipated benefits of the transaction. We expect to make acquisitions to expand into new markets and our acquisition strategy depends on our ability to complete and integrate the acquisitions. Mergers and acquisitions are inherently risky, and any mergers and acquisitions that we complete may not be successful. The process of integrating an acquired company’s business into our operations is challenging and may result in expected or unexpected operating or compliance challenges, which may require significant expenditures and a significant amount of our management’s attention that would otherwise be focused on the ongoing operation of our business. The potential difficulties or risks of integrating an acquired company’s business include, among others:

·the effect of the acquisition on our financial and strategic positions and our reputation; 

·risk that we fail to successfully implement our business plan for the combined business; 

·risk that we are unable to obtain the anticipated benefits of the acquisition, including synergies or economies of scale; 

·challenges in reconciling business practices or in integrating activities, logistics or information technology and other systems; 

·challenges in reconciling accounting issues, especially if an acquired company utilizes accounting principles different from those we use; 

·retention risk with respect to key customers, suppliers and employees and challenges in retaining, assimilating and training new employees; 

·potential failure of the due diligence processes to identify significant problems, liabilities or other shortcomings or challenges of an acquired company, which could result in unexpected litigation, regulatory exposure, financial contingencies and known and unknown liabilities; and 

·challenges in complying with newly applicable laws and regulations, including obtaining or retaining required approvals, licenses and permits. 

Our acquisitions may also result in the expenditure of available cash and amortization of expenses any of which could have a material adverse effect on our results of operations or financial condition. Investments in immature businesses with unproven track records have an especially high degree of risk, with the possibility that we may lose the value of our entire investments or incur additional unexpected liabilities. Large or costly acquisitions or investments may also diminish our capital resources and liquidity or limit our ability to engage in additional transactions for a period of time. All of the foregoing risks may be magnified as the cost, size or complexity of an acquisition or acquired company increases, or where the acquired company’s market or business are materially different from ours, or where more than one integration is occurring simultaneously or within a concentrated period of time.

In addition, in the future we may require significant financing to complete an acquisition or investment, whether through bank loans, raising of debt or otherwise. We cannot assure you that such financing options will be available to us on reasonable terms, or at all. If we are not able to obtain such necessary financing, it could have an impact on our ability to consummate a substantial acquisition or investment and execute our growth strategy. Alternatively, we

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may issue a significant number of shares as consideration for an acquisition, which would have a dilutive effect on our existing stockholders.

WODI’s financial results will fluctuate in the future, which makes them difficult to predict.

You should take into account the risks and uncertainties frequently encountered by rapidly growing companies in evolving markets. Its financial results in any given quarter can be influenced by numerous factors, many of which WODI are unable to predict or are outside of its control, including:

·WODI’s ability to maintain and grow its client base; 

·Ongoing management services by OCLN, if any, may not be adequate for WODI’s needs, and WODI may not be able to raise sufficient funds to successfully achieve internal management and funding capabilities; 

·Its clients may suffer downturns, financial instability or be subject to mergers or acquisitions; 

·The development and introduction of new products by WODI or its competitors; 

·Increases in marketing, sales, service and other operating expenses that WODI may incur to grow and expand its operations and to remain competitive; 

·WODI’s ability to achieve gross margins and operating margins; 

·Adverse litigation judgments, settlements, or other litigation-related costs; and 

·Changes in business or macroeconomic conditions including regulatory changes. 

WODI may face additional competition.

There may be other companies that are providing similar products and services in the United States and abroad that may potentially compete with its products and services. These or new competitors may have more resources than WODI or may be better capitalized, which may give them a significant advantage, for example, in offering better pricing than WODI, surviving an economic downturn or in reaching profitability. There can be no assurances that WODI will be able to compete successfully against existing or emerging competitors.

WODI is controlled by OCLN and its officers.

WODI is owned by OCLN and is controlled by its officers and directors. OCLN currently owns approximately 54% of WODI’s voting securities, respectively, and at the conclusion of this offering will continue to hold a significant portion of WODI’s voting rights. Therefore, investors in this offering will not have the ability to control the board of directors and will not have significant ability to control any specific vote of stockholders.

Actual or threatened epidemics, pandemics, outbreaks, or other public health crises may adversely affect its business, including the novel COVID-19 outbreak.

Its business could be materially and adversely affected by the risks, or the public perception of the risks, related to an epidemic, pandemic, outbreak, or other public health crisis, such as the recent outbreak of novel coronavirus, or COVID-19. The risk, or public perception of the risk, of a pandemic or media coverage of infectious diseases could adversely affect the value of the Shares and its Investors or prospective Investors financial condition, resulting in reduced demand for the Shares generally. Further, such risks could cause a limited attendance at membership experience events that WODI might sponsor or in which WODI might participate, or result in persons avoiding holding

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or appearing at in-person events. “Shelter-in-place” or other such orders by governmental entities could also disrupt its operations, if employees who cannot perform their responsibilities from home, are not able to report to work.

Risks Relating to the Business Combination

We may be unable to achieve some or all of the benefits that we expect to achieve from the Business Combination.

We believe that, as an independent, publicly traded company, we will be able to, among other things, design and implement corporate strategies and policies and develop partnerships that are better targeted to WODI’s business’s areas of strength and differentiation, better focus its financial and operational resources on those specific strategies, create effective incentives for its management and employees that are more closely tied to its business performance, provide investors more flexibility and enable us to achieve alignment with a more natural stockholder base and implement and maintain a capital structure designed to meet WODI’s specific needs. We may be unable to achieve some or all of the benefits that we expect to achieve as an independent company in the time we expect, if at all, for a variety of reasons, including as an independent, publicly traded company, we may be more susceptible to market fluctuations and other adverse events. If we fail to achieve some or all of the benefits that we expect to achieve as an independent company, or do not achieve them in the time we expect, WODI’s business, financial condition and results of operations could be adversely affected.

Failure to establish and maintain effective internal controls in accordance with Section 404 of the Sarbanes-Oxley Act could have a material adverse effect on WODI’s business and stock price.

WODI is not currently required to comply with the rules of the SEC implementing Section 404 of the Sarbanes-Oxley Act and is, therefore, not required to make a formal assessment of the effectiveness of WODI’s internal control over financial reporting for that purpose. Upon becoming a public company, WODI will be required to comply with the SEC’s rules implementing Sections 302 and 404 of the Sarbanes-Oxley Act, which will require management to certify financial and other information in WODI’s quarterly and annual reports and provide an annual management report on the effectiveness of controls over financial reporting. Although WODI will be required to disclose changes made in its internal controls and procedures on a quarterly basis, WODI will not be required to make its first annual assessment of its internal control over financial reporting pursuant to Section 404 until the year following its first annual report required to be filed with the SEC.

To comply with the requirements of being a public company, WODI has undertaken various actions, and will need to take additional actions, such as implementing numerous internal controls and procedures and hiring additional accounting or internal audit staff or consultants. Testing and maintaining internal control can divert WODI’s management’s attention from other matters that are important to the operation of WODI’s business. Additionally, when evaluating WODI’s internal control over financial reporting, WODI may identify material weaknesses that WODI may not be able to remediate in time to meet the applicable deadline imposed upon WODI for compliance with the requirements of Section 404. Investors may lose confidence in the accuracy and completeness of WODI’s financial reports and the market price of WODI’s common stock could be negatively affected if any of the following occurs: (i) WODI identifies any material weaknesses in its internal control over financial reporting; (ii) WODI is unable to comply with the requirements of Section 404 in a timely manner; (iii) WODI asserts that its internal control over financial reporting is ineffective; or (iv) WODI’s independent registered public accounting firm is unable to express an opinion as to the effectiveness of its internal control over financial reporting once WODI is no longer an emerging growth company. WODI could also become subject to investigations by the SEC, the stock exchange on which its securities are listed or other regulatory authorities, which could require additional financial and management resources. In addition, if WODI fails to remedy any material weakness, WODI’s financial statements could be inaccurate and WODI could face restricted access to capital markets.

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WODI is an “emerging growth company” and “smaller reporting company” and as such the reduced disclosure requirements applicable to emerging growth companies and smaller reporting companies may make WODI’s common stock less attractive to investors.

WODI is an “emerging growth company,” as defined in the JOBS Act. As an emerging growth company we may follow reduced disclosure requirements and do not have to make all of the disclosures that public companies that are not emerging growth companies do. We will remain an emerging growth company until the earlier of (a) the last day of the fiscal year in which WODI has total annual gross revenues of $1.235 billion or more; (b) the last day of the fiscal year following the fifth anniversary of the date of the completion of the initial public offering of FRLA; (c) the date on which WODI has issued more than $1 billion in nonconvertible debt during the previous three years; or (d) the date on which WODI is deemed to be a large accelerated filer under the rules of the SEC, which means the market value of WODI’s Class A common stock that is held by non-affiliates exceeds $700.0 million as of the prior June 30^th. For so long as we remain an emerging growth company, WODI is permitted and intend to rely on exemptions from certain disclosure requirements that are applicable to other public companies that are not emerging growth companies. These exemptions include:

·not being required to comply with the auditor attestation requirements of Section 404 of the Sarbanes-Oxley Act; 

·not being required to comply with any requirement that may be adopted by the Public Company Accounting Oversight Board regarding mandatory audit firm rotation or a supplement to the auditor’s report providing additional information about the audit and the financial statements (i.e., an auditor discussion and analysis); 

·reduced disclosure obligations regarding executive compensation in WODI’s periodic reports, proxy statements, and registration statements; and 

·exemptions from the requirements of holding a nonbinding advisory vote of stockholders on executive compensation, stockholder approval of any golden parachute payments not previously approved, and having to disclose the ratio of the compensation of WODI’s chief executive officer to the median compensation of WODI’s employees. 

In addition, the JOBS Act provides that an emerging growth company can take advantage of an extended transition period for complying with new or revised accounting standards. This allows an emerging growth company to delay the adoption of certain accounting standards until those standards would otherwise apply to private companies. WODI has elected to use the extended transition period for complying with new or revised accounting standards; and as a result of this election, WODI’s financial statements may not be comparable to companies that comply with public company effective dates.

Further, WODI is a “smaller reporting company” as defined in Rule 10(f)(1) of Regulation S-K. Smaller reporting companies may take advantage of certain reduced disclosure obligations, including, among other things, providing only two years of audited financial statements. We will remain a smaller reporting company until the last day of the fiscal year in which (1) the market value of WODI’s Class A common stock held by non-affiliates equals or exceeds $250.0 million as of the end of the prior June 30^th, or (2) WODI’s annual revenues equaled or exceeded $100.0 million during such completed fiscal year and the market value of WODI’s Class A common stock held by non-affiliates exceeds $700.0 million as of the prior June 30^th. To the extent we take advantage of such reduced disclosure obligations, it may also make comparison of its financial statements with other public companies difficult or impossible.

We may choose to take advantage of some, but not all, of the available exemptions for emerging growth companies. We cannot predict whether investors will find its common stock less attractive if we rely on these exemptions. If some investors find WODI’s common stock less attractive as a result, there may be a less active trading market for WODI’s Class A common stock and its share price may be more volatile.

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In order to satisfy WODI’s obligations as a public company, we will need to hire qualified accounting and financial personnel with appropriate public company experience.

As a public company, we will need to establish and maintain effective disclosure and financial controls and make changes in its corporate governance practices. We may need to hire additional accounting and financial personnel with appropriate public company experience and technical accounting knowledge, and it may be difficult to recruit and retain such personnel. Even if WODI is able to hire appropriate personnel, its existing operating expenses and operations will be impacted by the direct costs of their employment and the indirect consequences related to the diversion of management resources from research and development efforts.

The commercial and credit environment may adversely affect WODI’s access to capital.

We will need to continue to raise capital in order to execute our business plan. WODI’s ability to issue debt or enter into other financing arrangements on acceptable terms could be adversely affected if there is a material decline in the demand for its products or in the solvency of its customers or suppliers or if there are other significantly unfavorable changes in economic conditions. Volatility in the world financial markets could increase borrowing costs or affect WODI’s ability to access the capital markets. Capital raised by us may have a dilutive impact on existing stockholders and if WODI is unable to raise additional capital on favorable terms, or at all, we may be unable to maintain its research and development activities or may be unable to grow its business, which could impact WODI’s operating results and gross margin adversely.

The Amended Charter will require, to the fullest extent permitted by law, that derivative actions brought in WODI’s name, actions against its directors, officers, other employees or stockholders for breach of fiduciary duty and certain other actions may be brought only in the Court of Chancery in the State of Delaware and, if brought outside of Delaware, the stockholder bringing the suit will, subject to certain exceptions, be deemed to have consented to service of process on such stockholder’s counsel, which may have the effect of discouraging lawsuits against its directors, officers, other employees or stockholders.

FRLA’s Charter requires, and the Amended Charter will continue to require, to the fullest extent permitted by law, that derivative actions brought in WODI’s name, actions against its directors, officers, other employees or stockholders for breach of fiduciary duty and certain other actions may be brought only in the Court of Chancery in the State of Delaware and, if brought outside of Delaware, the stockholder bringing the suit will be deemed to have consented to service of process on such stockholder’s counsel except any action (A) as to which the Court of Chancery in the State of Delaware determines that there is an indispensable party not subject to the jurisdiction of the Court of Chancery (and the indispensable party does not consent to the personal jurisdiction of the Court of Chancery within ten days following such determination), (B) which is vested in the exclusive jurisdiction of a court or forum other than the Court of Chancery or (C) for which the Court of Chancery does not have subject matter jurisdiction. Any person or entity purchasing or otherwise acquiring any interest in WODI’s common stock shall be deemed to have notice of and consented to the forum provisions in the Amended Charter. This choice of forum provision may limit or make more costly a stockholder’s ability to bring a claim in a judicial forum that it finds favorable for disputes with us or any of WODI’s directors, officers, other employees or stockholders, which may discourage lawsuits with respect to such claims. Alternatively, if a court were to find the choice of forum provision contained in the Amended Charter to be inapplicable or unenforceable in an action, we may incur additional costs associated with resolving such action in other jurisdictions, which could harm WODI’s business, operating results and financial condition. The Amended Charter will provide that the exclusive forum provision will be applicable to the fullest extent permitted by applicable law, subject to certain exceptions. Section 27 of the Exchange Act creates exclusive federal jurisdiction over all suits brought to enforce any duty or liability created by the Exchange Act or the rules and regulations thereunder. As a result, the exclusive forum provision will not apply to suits brought to enforce any duty or liability created by the Exchange Act or any other claim for which the federal courts have exclusive jurisdiction. In addition, the Amended Charter provides that, unless we consent inwriting to the selection of an alternative forum, the federal district courts of the United States of America shall, to the fullest extent permitted by law, be the exclusive forum for the resolution of any complaint asserting a cause of action arising under the Securities Act of 1933, as amended, or the rules and regulations promulgated thereunder. We note, however, that there is uncertainty as to whether a court would enforce

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this provision and that investors cannot waive compliance with the federal securities laws and the rules and regulations thereunder. Section 22 of the Securities Act creates concurrent jurisdiction for state and federal courts over all suits brought to enforce any duty or liability created by the Securities Act or the rules and regulations thereunder.

Wage increases and pressure in certain geographies may prevent us from sustaining WODI’s competitive advantage and may reduce its profit margin.

Measures are being taken in the United States and globally to increase minimum wages, and there is a shortage of skilled labor in certain locations leading to increased wage pressure. Similarly, with an increased global focus on environmental, social and corporate-governance concerns and sustainability, input costs have been steadily rising. Accordingly, we may need to increase the levels of labor compensation more rapidly than in the past to remain competitive in attracting and retaining the quality and amount of labor that its business requires. To the extent that WODI is not able to control or share wage increases, wage increases may reduce its margins and cash flows, which could adversely affect its business.

The loss of one or more key members of WODI’s management team or personnel, or its failure to attract, integrate and retain additional personnel in the future, could harm its business and negatively affect its ability to successfully grow its business.

WODI is highly dependent upon the continued service and performance of the key members of WODI’s management team and other personnel. The loss of any of these individuals, each of whom is “at will” and may terminate his or her employment relationship with us at any time, could disrupt its operations and significantly delay or prevent the achievement of its business objectives. We believe that its future success will also depend in part on its continued ability to identify, hire, train and motivate qualified personnel. High demand exists for senior management and other key personnel (including technical, engineering, product, finance and sales personnel) in the infrastructure and manufacturing industry. A possible shortage of qualified individuals in the regions where we operate might require us to pay increased compensation to attract and retain key employees, thereby increasing its costs. In addition, we face intense competition for qualified individuals from numerous companies, many of whom have substantially greater financial and other resources and name recognition than us. We may be unable to attract and retain suitably qualified individuals who are capable of meeting its growing operational, managerial and other requirements, or we may be required to pay increased compensation in order to do so. For example, WODI’s failure to attract and retain shop floor employees may inhibit its ability to fulfill production orders for its customers. WODI’s failure to attract, hire, integrate and retain qualified personnel could impair its ability to achieve its business objectives.

All of WODI’s employees (which includes full time and part time employees and consultants) are at-will employees, meaning that they may terminate their employment relationship with us at any time, and their knowledge of its business and industry would be extremely difficult to replace. We generally enter into non-competition agreements with its employees and certain consultants. These agreements prohibit WODI’s employees and applicable consultants from competing directly with us or working for its competitors or customers while they work for us, and in some cases, for a limited period after they cease working for us. We may be unable to enforce these agreements under the laws of the jurisdictions in which its employees and applicable consultants work and it may be difficult for us to restrict WODI’s competitors from benefiting from the expertise that WODI’s former employees or consultants developed while working for us. If we cannot demonstrate that its legally protectable interests will be harmed, we may be unable to prevent its competitors from benefiting from the expertise of its former employees or consultants and its ability to remain competitive may be diminished.

Risks Related to Government Regulations

Our business is subject to various laws and regulations and changes in such laws and regulations, or failure to comply with existing or future laws and regulations, could adversely affect our business.

Our business is subject to numerous and frequently changing federal, state and local laws and regulations. We routinely incur significant costs in complying with these regulations. The complexity of the regulatory environment in which

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we operate and the related cost of compliance are increasing due to additional legal and regulatory requirements, our expanding operation and increased enforcement efforts. Further, uncertainties exist regarding the future application of certain of these legal requirements to our business. New or existing laws, regulations and policies, liabilities arising thereunder and the related interpretations and enforcement practices, particularly those dealing with environmental protection and compliance, taxation, zoning and land use, workplace safety, public health, recurring debit and credit card charges, information security, consumer protection, and privacy and labor and employment, among others, or changes in existing laws, regulations, policies and the related interpretations and enforcement practices, particularly those governing the sale of products and consumer protection, may result in significant added expenses or may require extensive system and operating changes that may be difficult to implement and/or could materially increase our cost of doing business. For example, we have to comply with recent new laws in some of the states in which we operate regarding recycling, waste, minimum wages, and sick time. In addition, we are subject to environmental laws pursuant to which we could be strictly liable for any contamination at our current or former locations, or at third-party waste disposal sites, regardless of our knowledge of or responsibility for such contamination.

Our operations are subject to certain environmental laws and regulations.

Our current and former operations are governed by federal, state and local laws and regulations, including environmental regulations. Certain business activities involve the handling, storage, transportation, import/export, recycling, or disposing of various new and used products and generate solid and hazardous wastes. These business activities are subject to stringent federal, regional, state and local laws, by-laws and regulations governing the storage and disposal of these products and wastes, the release of materials into the environment or otherwise relating to environmental protection. These laws and regulations may impose numerous obligations upon our locations’ operations, including the acquisition of permits to conduct regulated activities, the imposition of restrictions on where or how to store and how to handle new products and to manage or dispose of used products and wastes, the incurrence of capital expenditures to limit or prevent releases of such material, the imposition of substantial liabilities for pollution resulting from our locations’ operations, and costs associated with workers’ compensation and similar health claims from employees.

Environmental laws and regulations have generally imposed further restrictions on our operations over time, which may result in significant additional costs to our business. Failure to comply with these laws, regulations, and permits may result in the assessment of administrative, civil, and criminal penalties, the imposition of remedial and corrective action obligations, and the issuance of injunctions limiting or preventing operation of our locations. Any adverse environmental impact on our locations, including, without limitation, the imposition of a penalty or injunction, or increased claims from employees, could materially and adversely affect our business and the results of our operations.

Environmental laws also impose liability for damages from and the costs of investigating and cleaning up sites of spills, disposals or other releases of hazardous materials. Such liability may be imposed, jointly and severally, on the current or former owners or operators of properties or parties that sent wastes to third-party disposal facilities, in each case without regard to fault or whether such persons knew of or caused the release. Moreover, neighboring landowners and other third parties may file claims for nuisance (including complaints involving noise and light), personal injury and property or natural resource damage allegedly caused by our operations and the release of petroleum hydrocarbons, hazardous substances or wastes into the environment. Although we are not presently aware of any such material liability related to our current or former locations or business operations, such liability could arise in the future and could materially and adversely affect our business and the results of our operations.

Government regulations, weather conditions and natural hazards may affect our business.

Climate change, drought, overuse of sources of water, the protection of threatened species or habitats or other factors may limit the availability of ground and surface water. Climate change and seasonal drought conditions may impact our access to water supplies, and drought conditions currently exist in several areas of the United States. Governmental restrictions on water use may also result in decreased access to water supplies, which may adversely affect our financial condition and results of operations. Water service interruptions due to severe weather events are also possible. These include winter storms and freezing conditions in colder climate locations, high wind conditions in

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areas known to experience tornados, earthquakes in areas known to experience seismic activity, high water conditions in areas located in or near designated flood plains, hurricanes and severe electrical storms also have the potential to impact our access to water.

Any interruption in our ability to access water could materially and adversely affect our financial condition and results of operations. Furthermore, losses from business interruptions or damage to our facilities might not be covered by our insurance policies and such losses may make it difficult for us to secure insurance in the future at acceptable rates.

Risks Related to WODI’s Business

Failure to protect or enforce our intellectual property could reduce or eliminate any competitive advantage and reduce our potential sales and profitability and the cost of protecting or enforcing our intellectual property may be significant.

Our long-term success depends on our ability to market innovative competitive products. We own a number of patents, trade secrets, copyrights, trademarks, trade names and other forms of intellectual property related to our products and services throughout the world and the operation of our business, which we rely on to distinguish our services and solutions from those of our competitors. Patents have a limited life and, in some cases, have expired or will expire in the near future. We also have non-exclusive rights to intellectual property owned by others in certain of our markets. For example, some of our products may include components that are manufactured by our competitors. Our intellectual property may be challenged, invalidated, stolen, circumvented, infringed or otherwise violated upon by third parties or we may be unable to maintain, renew or enter into new license agreements with third-party owners of intellectual property on reasonable terms, or at all. In addition, the global nature of our business increases the risk that our intellectual property may be subject to infringement, theft or other unauthorized use or disclosure by others. Our ability to protect and enforce intellectual property rights, including through litigation or other legal proceedings, also varies across jurisdictions and in some cases, our ability to protect our intellectual property rights by legal recourse or otherwise may be limited, particularly in countries where laws or enforcement practices are less protective than those in the United States. Our inability to obtain sufficient protection for our intellectual property, or to effectively maintain or enforce our intellectual property rights, could lead to reputational harm and/or adversely impact our competitive position, business, financial condition or results of operations.

Competitors and others may also initiate litigation or other proceedings to challenge the scope, validity or enforceability of our intellectual property or allege that we infringed, misappropriated or otherwise violated their intellectual property. Any litigation or proceedings to defend ourselves against allegations of infringement, misappropriation, or other violations of intellectual property rights, regardless of merit, could be costly, divert attention of management and may not ultimately be resolved in our favor. If we are unable to successfully defend against claims that we have infringed the intellectual property rights of others, we may be prevented from using certain intellectual property or offering certain products, or may be liable for substantial damages, which in turn could materially adversely affect our business, financial condition or results of operations. We may also be required to develop an alternative, non-infringing product that could be costly, time-consuming or impossible, or seek a license from a third party, which may not be available on terms that are favorable to us, or at all. Any of the foregoing could have a material adverse effect on our business, financial condition and results of operations.

We rely on a limited number of suppliers for certain raw materials and supplied components. We may not be able to obtain sufficient raw materials or supplied components to meet our manufacturing and operating needs, or obtain such materials on favorable terms, which could impair our ability to fulfill our orders in a timely manner or increase our costs of production.

Our ability to manufacture is dependent upon sufficient availability of raw materials and supplied components, which we secure from a limited number of suppliers. Our reliance on suppliers to secure these raw materials and supplied components exposes us to volatility in the prices and availability of these materials. We may not be able to obtain sufficient supply of raw materials or supplied components, on favorable terms or at all, which could result in delays in manufacture of our spacecraft or increased costs.

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Additionally, the imposition of tariffs on such raw materials or supplied components could have a material adverse effect on our operations. Prolonged disruptions in the supply of any of our key raw materials or components, difficulty qualifying new sources of supply, implementing use of replacement materials or new sources of supply or any volatility in prices could have a material adverse effect on our ability to operate in a cost-efficient, timely manner and could cause us to experience cancellations or delays of scheduled launches, customer cancellations or reductions in our prices and margins, any of which could harm our business, financial condition and results of operations.

Risks Related to Being a Public Company

The financial reporting obligations of being a public company in the United States are expensive and time consuming and place significant additional demands on our management.

The obligations of being a public company in the United States place additional demands on our management and require significant expenditures, including costs resulting from public company reporting obligations under the Exchange Act; the rules and regulations regarding corporate governance practices, including those under the Sarbanes-Oxley Act and the Dodd Frank Wall Street Reform and Consumer Protection Act; and the listing requirements for Nasdaq. Our management and other personnel devote a substantial amount of time to ensure that we comply with these requirements. Moreover, despite reforms made possible by the Jumpstart Our Business Startups Act of 2012 and the 2015 Fixing America’s Surface Transportation Act, the reporting requirements, rules, and regulations will increase our legal and financial compliance costs and will make some activities more time-consuming and costly, particularly if we were no longer to qualify as a smaller reporting company. Any changes that we make to comply with these obligations may not be sufficient to allow us to satisfy our obligations as a public company on a timely basis, or at all.

These rules and regulations make it more difficult and more expensive for us to obtain director and officer liability insurance, and we may be required to accept reduced policy limits and coverage or incur substantially higher costs to obtain the same or similar coverage. These factors also could make it more difficult for us to attract and retain qualified persons to serve on our Board of Directors, particularly to serve on our Audit Committee and Compensation Committee, or as executive officers.

WODI has no operating history as a publicly traded company, and its historical financial information is not necessarily representative of the results we would have achieved as a publicly traded company and may not be a reliable indicator of its future results.

The historical financial information included in this proxy statement/prospectus/consent solicitation statement from WODI’s operation as a private company does not necessarily reflect the results of operations and financial position we would have achieved as a publicly traded company during the periods presented, or those that we will achieve in the future. This is primarily because of the following factors:

·Prior to the Business Combination, we operated as a private company. WODI’s historical financial information reflects allocations of corporate expenses as a private company. These allocations may not reflect the costs we will incur for similar services in the future as a publicly traded company. 

·WODI’s historical financial information does not reflect changes that we expect to experience in the future as a result of becoming a publicly traded company, including changes in the financing, insurance, cash management, operations, cost structure and personnel needs of WODI’s business. As a publicly traded entity, we may be unable to purchase goods, services and technologies, such as insurance and health care benefits and computer software licenses, or access capital markets, on terms as favorable to us as those we obtained as a private company prior to the Business Combination, and WODI’s results of operations may be adversely affected. In addition, WODI’s historical financial data do not include an allocation of interest expense comparable to the interest expenses we will incur as a result of the Business Combination and related transactions. 

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Following the Business Combination, we will also face additional costs and demands on management’s time associated with being a publicly traded company, including costs and demands related to corporate governance, investor and public relations and public reporting. Stockholder activism, the current political and social environment and the current high level of government intervention and regulatory reform may lead to substantial new regulations and disclosure obligations, which will likely result in additional compliance costs and could impact the manner in which WODI operates its business in ways WODI cannot currently anticipate. For additional information about WODI’s past financial performance, see “Summary Historical Financial Information of WODI,” “Unaudited Pro Forma Condensed Combined Financial Information,” “Management’s Discussion and Analysis of Financial Condition and Results of Operations of WODI” and WODI’s historical Consolidated Financial Statements and the Notes thereto included elsewhere in this proxy statement/prospectus/consent solicitation statement.

We may be unable to make, on a timely or cost-effective basis, the changes necessary to operate as an independent, publicly traded company, and we may experience increased costs after the Business Combination.

WODI is currently installing and implementing information technology infrastructure to support certain of its business functions, including accounting and reporting, human resources, sales operations, customer service, and distribution. We may incur substantially higher costs than previously anticipated as we transition from the transactional and operational systems we used when we were a private company. If WODI is unable to transition effectively, we may incur temporary interruptions in business operations. Any delay in implementing, or operational interruptions suffered while implementing, WODI’s new information technology infrastructure could disrupt its business and have a material adverse effect on our results of operations.

Risks Related to FRLA’s Business and the Business Combination

If we are unable to complete an initial business combination on or prior to November 5, 2024, our public stockholders may receive only approximately $10.95 per share on the liquidation of our trust account (or less than $10.95 per share in certain circumstances where a third party brings a claim against us that the Sponsor is unable to indemnify), and our warrants will expire worthless.

If we are unable to complete an initial business combination on or prior to November 5, 2024, our public stockholders may receive only approximately $10.95 per share on the liquidation of our trust account (or less than $10.95 per share in certain circumstances where a third party brings a claim against us that the Sponsor is unable to indemnify (as described below)), and our warrants will expire worthless.

You must tender your Public Shares in order to validly seek redemption at the FRLA Special Meeting of Stockholders.

In connection with tendering your Public Shares for redemption, you must elect either to physically tender your share certificates to VStock or to deliver your Public Shares to VStock electronically using DTC’s DWAC (Deposit/Withdrawal At Custodian) System, in each case at least two business days before the FRLA Special Meeting.

The requirement for physical or electronic delivery ensures that a redeeming holder’s election to redeem is irrevocable once the Business Combination is consummated. Any failure to observe these procedures will result in your loss of redemption rights in connection with the vote on the Business Combination.

If third parties bring claims against FRLA, the proceeds held in trust could be reduced and the per Public Shares liquidation price received by the holders of Public Shares may be less than $10.00.

FRLA’s placing of funds in trust may not protect those funds from third party claims against FRLA. Although FRLA has received from many of the vendors, service providers (other than its independent accountants) and prospective target businesses with which it does business executed agreements waiving any right, title, interest or claim of any kind in or to any monies held in the Trust Account for the benefit of FRLA’s public stockholders, they may still seek recourse against the Trust Account. Additionally, a court may not uphold the validity of such agreements. Accordingly,

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the proceeds held in trust could be subject to claims which could take priority over those of FRLA’s public stockholders. If FRLA liquidates the Trust Account before the completion of a business combination and distributes the proceeds held therein to its public stockholders, the Sponsor has contractually agreed that it will be liable to ensure that the proceeds in the Trust Account are not reduced by the claims of target businesses or claims of vendors or other entities that are owed money by us for services rendered or contracted for or products sold to us, but only if such a vendor or prospective target business does not execute such a waiver. However, FRLA cannot assure you that they will be able to meet such obligation. Therefore, the per-share distribution from the Trust Account for our stockholders may be less than $10.00 per Public Shares due to such claims.

Additionally, if FRLA is forced to file a bankruptcy case or an involuntary bankruptcy case is filed against it which is not dismissed, the proceeds held in the Trust Account could be subject to applicable bankruptcy law, and may be included in FRLA’s bankruptcy estate and subject to the claims of third parties with priority over the claims of its stockholders. To the extent any bankruptcy claims deplete the Trust Account, FRLA may not be able to return $10.00 to our public stockholders.

Any distributions received by FRLA stockholders could be viewed as an unlawful payment if it was proved that immediately following the date on which the distribution was made, FRLA was unable to pay its debts as they fell due in the ordinary course of business.

FRLA’s Certificate of Incorporation provides that it will continue in existence only until November 5, 2024. If FRLA is unable to consummate a transaction within the required time periods, upon notice from FRLA, the trustee of the Trust Account will distribute the amount in its Trust Account to its public stockholders. Concurrently, FRLA shall pay, or reserve for payment, from funds not held in trust, its liabilities and obligations, although FRLA cannot assure you that there will be sufficient funds for such purpose.

We expect that all costs and expenses associated with implementing our plan of dissolution, as well as payments to any creditors, will be funded from the proceeds held in the Trust Account.

However, we may not properly assess all claims that may be potentially brought against us. As such, our stockholders could potentially be liable for any claims to the extent of distributions received by them (but no more) and any liability of our stockholders may extend well beyond the third anniversary of the date of distribution. Accordingly, third parties may seek to recover from our stockholders amounts owed to them by us.

If, after we distribute the proceeds in the Trust Account to our public stockholders, we file a bankruptcy petition or an involuntary bankruptcy petition is filed against us that is not dismissed, any distributions received by stockholders could be viewed under applicable debtor/creditor and/or bankruptcy laws as either a “preferential transfer” or a “fraudulent conveyance.” As a result, a bankruptcy court could seek to recover all amounts received by our stockholders. In addition, our Board may be viewed as having breached its fiduciary duty to our creditors and/or having acted in bad faith, thereby exposing itself and us to claims of punitive damages, by paying public stockholders from the trust account prior to addressing the claims of creditors.

If FRLA’s due diligence investigation of WODI was inadequate, then stockholders of FRLA following the Business Combination could lose some or all of their investment.

Even though FRLA conducted a thorough due diligence investigation of WODI, it cannot be sure that this diligence uncovered all material issues that may be present inside WODI or its business, or that it would be possible to uncover all material issues through a customary amount of due diligence, or that factors outside of WODI and its business and outside of its control will not later arise.

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Because the post-combination company will be a publicly traded company by virtue of a merger as opposed to an underwritten initial public offering, the process does not use the services of one or more underwriters, which could result in less diligence being conducted.

In an underwritten initial public offering, underwriters typically conduct due diligence on the company being taken public in order to establish a due diligence defense against liability claims under federal securities laws. Because FRLA is already a publicly traded company, an underwriter has not been engaged. The Sponsor is owned by WODI and therefore the Sponsor may have an inherent conflict of interest because its shares and warrants will be worthless if a business combination is not completed, management and the board of directors of the acquirer, as well as private investors, undertake a certain level of due diligence. However, this due diligence is not necessarily the same level of due diligence undertaken by an underwriter in a traditional initial public offering. If such investigation had occurred, certain information in this proxy statement/prospectus/consent solicitation statement may have been presented in a different manner or additional information may have been presented at the request of such underwriter.

Stockholder litigation and regulatory inquiries and investigations are expensive and could harm FRLA’s operating results and could divert management attention.

In the past, securities class action litigation and/or stockholder derivative litigation and inquiries or investigations by regulatory authorities have often followed certain significant business transactions, such as the sale of a company or announcement of any other strategic transaction, such as the Business Combination. Any stockholder litigation and/or regulatory investigations against FRLA, whether or not resolved in FRLA’s favor, could result in substantial costs and divert FRLA’s management’s attention from other business concerns, which could adversely affect FRLA’s business and cash resources and the ultimate value FRLA’s stockholders receive as a result of the Business Combination.

The Initial Stockholders who own shares of FRLA Class B Common Stock will not participate in liquidation distributions and, therefore, they may have a conflict of interest in determining whether the Business Combination is appropriate.

As of the Record Date, the Initial Stockholders (including FRLA’s directors and officers) owned an aggregate of 2,443,750 shares of FRLA Class B Common Stock. They have waived their right to redeem any of their shares of FRLA Class B Common Stock in connection with a stockholder vote to approve a proposed initial business combination or sell any shares of FRLA Class B Common Stock to FRLA in a tender offer in connection with a proposed initial business combination, or to receive distributions with respect to any shares of FRLA Class B Common Stock upon the liquidation of the Trust Account if FRLA is unable to consummate a business combination. Based on a market price of $[__] per Public Share on [__], 2024, the value of the shares of FRLA Class B Common Stock held by the Initial Stockholders was $[__]. The shares of FRLA Class B Common Stock acquired prior to the IPO will be worthless if FRLA does not consummate a business combination. Consequently, our directors’ discretion in identifying and selecting WODI as a suitable target business may result in a conflict of interest when determining whether the terms, conditions and timing of the Business Combination are appropriate and in FRLA’s public stockholders’ best interest.

FRLA is requiring stockholders who wish to redeem their Public Shares in connection with a proposed business combination to comply with specific requirements for redemption that may make it more difficult for them to exercise their redemption rights prior to the deadline for exercising their rights.

FRLA is requiring stockholders who wish to redeem their Public Shares to either tender their certificates to VStock or to deliver their Public Shares to VStock electronically using the DTC’s DWAC (Deposit/Withdrawal At Custodian) System at least two business days before the FRLA Special Meeting. In order to obtain a physical certificate, a stockholder’s broker and/or clearing broker, DTC and VStock will need to act to facilitate this request. It is FRLA’s understanding that stockholders should generally allot at least two weeks to obtain physical certificates from VStock. However, because FRLA does not have any control over this process or over the brokers or DTC, it may take significantly longer than two weeks to obtain a physical certificate. While FRLA has been advised that it takes a short time to deliver Public Shares through the DWAC System, FRLA cannot assure you of this fact. Accordingly, if it

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takes longer than FRLA anticipates for stockholders to deliver their Public Units, stockholders who wish to redeem may be unable to meet the deadline for exercising their redemption rights and thus may be unable to redeem their Public shares.

FRLA will require its public stockholders who wish to redeem their Public Shares in connection with the Business Combination to comply with specific requirements for redemption described above, such redeeming stockholders may be unable to sell their securities when they wish to in the event that the Business Combination is not consummated.

If FRLA requires public stockholders who wish to redeem their Public Shares in connection with the proposed Business Combination to comply with specific requirements for redemption as described above and the Business Combination is not consummated, FRLA will promptly return such certificates to its public stockholders. Accordingly, investors who attempted to redeem their Public Shares in such a circumstance will be unable to sell their securities after the failed acquisition until FRLA has returned their securities to them. The market price of the Public Shares may decline during this time and you may not be able to sell your securities when you wish to, even while other stockholders that did not seek redemption may be able to sell their securities.

If FRLA’s security holders exercise their registration rights with respect to their securities, it may have an adverse effect on the market price of FRLA’s securities.

FRLA has entered into a registration rights agreement by and among FRLA, the Sponsor, the Initial Stockholders, and the Representatives, pursuant to which registration rights were granted with respect to the Founder Shares, Private Placement Shares, and shares of FRLA Class A Common Stock issued in payment of working capital loans made to FRLA at a price of $10.00 per share (the “Working Capital Shares”) (collectively, the “Registrable Securities”), pursuant to which at any time commencing after the consummation of FRLA’s initial business combination, the holders of the Registrable Securities are entitled to make a demand that FRLA register the resale Registrable Securities. If such persons exercise their registration rights with respect to all of their securities, then there will be additional shares of Common Stock eligible for trading in the public market after the closing of the Business Combination. The presence of these additional shares of Common Stock trading in the public market may have an adverse effect on the market price of FRLA’s securities.

If the Business Combination’s benefits do not meet the expectations of financial or industry analysts, the market price of FRLA’s securities may decline.

The market price of FRLA’s securities may decline as a result of the Business Combination if:

·FRLA does not achieve the perceived benefits of the acquisition as rapidly as, or to the extent anticipated by, financial or industry analysts; or 

·The effect of the Business Combination on the financial statements is not consistent with the expectations of financial or industry analysts. 

Accordingly, investors may experience a loss as a result of decreasing stock prices.

FRLA’s directors and officers may have certain conflicts in determining to recommend the acquisition of WODI, since certain of their interests, and certain interests of their affiliates and associates, are different from, or in addition to, your interests as a shareholder.

FRLA’s management and directors have interests in and arising from the Business Combination that are different from, or in addition to, your interests as a shareholder, which could result in a real or perceived conflict of interest. These interests include the fact that the FRLA Class B Common Stock owned by FRLA’s management and directors, or their affiliates and associates, would become worthless if the Business Combination Proposal is not approved and FRLA otherwise fails to consummate a business combination prior to November 5, 2024 (unless such date has been

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extended as described herein). See “FRLA Proposal 1 – The FRLA Business Combination Proposal — Interests of Certain Persons in the Business Combination” and “FRLA Proposal 1 – The FRLA Business Combination Proposal — Interests of FRLA’s Directors and Officers in the Business Combination” for additional information.

FRLA and WODI have incurred and expect to incur significant costs associated with the Business Combination.

Each of FRLA and WODI has incurred and expects that it will incur significant, non-recurring costs in connection with consummating the Business Combination. FRLA and WODI may also incur additional costs to retain key employees. FRLA and WODI will also incur significant legal, financial advisor, accounting, banking and consulting fees, fees relating to regulatory filings and notices, SEC filing fees, printing and mailing fees and other costs associated with the Business Combination. FRLA and WODI estimate that they will incur $4.1 million in aggregate transaction costs, inclusive of $3.4 million in deferred underwriting fees. Some of these costs are payable regardless of whether the Business Combination is completed.

The unaudited pro forma condensed combined financial information included in this proxy statement/prospectus/consent solicitation statement may not be indicative of what the Combined Company’s actual financial position or results of operations would have been.

The unaudited pro forma condensed combined financial information in this proxy statement/prospectus/consent solicitation statement is presented for illustrative purposes only and is not necessarily indicative of what Combined Company’s actual financial position or results of operations would have been had the Business Combination been completed on the dates indicated. See the section titled “Unaudited Pro Forma Condensed Combined Financial Information” for more information.

In the event that a significant number of Public Shares are redeemed, our FRLA Class A Common Stock may become less liquid following the Business Combination.

If a significant number of Public Shares are redeemed, FRLA may be left with a significantly smaller number of stockholders. As a result, trading in the shares of the Combined Company may be limited and your ability to sell your shares in the market could be adversely affected. The Combined Company intends to apply to list its shares on the Nasdaq stock market, and Nasdaq may not list the Common Stock on its exchange, which could limit investors’ ability to make transactions in FRLA’s securities and subject FRLA to additional trading restrictions.

Nasdaq 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.

We cannot assure you that our securities will be listed on Nasdaq after the Business Combination. In connection with the Business Combination, we will be required to demonstrate compliance with Nasdaq’s initial listing requirements, which are more rigorous than Nasdaq’s continued listing requirements. For instance, our stock price would generally be required to be at least $4.00 per share, and we will be required to have a minimum of 400 unrestricted round lot holders (with at least 50% of such holders holding unrestricted securities). We cannot assure you that we will be able to meet those initial listing requirements at that time. Our continued eligibility for listing may depend on, among other things, the number of our shares that are redeemed.

If Nasdaq delists our securities from trading on its exchange and we are not able to list our securities on another national securities exchange, we expect our securities could be quoted on an over-the-counter market. If this were to occur, we could face significant material adverse consequences, including:

·a limited availability of market quotations for our securities; 

·reduced liquidity for our securities; 

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·a determination that our common stock is a “penny stock” which will require brokers trading in our common stock to adhere to more stringent rules and possibly result in a reduced level of trading activity in the secondary trading market for our securities; 

·a limited amount of news and analyst coverage; and 

·a decreased ability to issue additional securities or obtain additional financing in the future. 

The National Securities Markets Improvement Act of 1996, which is a federal statute, prevents or pre-empts the states from regulating the sale of certain securities, which are referred to as “covered securities.” Because our units, Class A common stock and Public Warrants are listed on Nasdaq, our units, Class A common stock and Public Warrants qualify as covered securities. Although the states are pre-empted from regulating the sale of our securities, the federal statute does allow the states to investigate companies if there is a suspicion of fraud, and, if there is a finding of fraudulent activity, then the states can regulate or bar the sale of covered securities in a particular case. While we are not aware of a state having used these powers to prohibit or restrict the sale of securities issued by blank check companies, other than the state of Idaho, certain state securities regulators view blank check companies unfavorably and might use these powers, or threaten to use these powers, to hinder the sale of securities of blank check companies in their states. Further, if we were no longer listed on Nasdaq, our securities would not be covered securities and we would be subject to regulation in each state in which we offer our securities.

FRLA may waive one or more of the conditions to the Business Combination without resoliciting shareholder approval for the Business Combination.

FRLA may agree to waive, in whole or in part, some of the conditions to its obligations to complete the Business Combination, to the extent permitted by applicable laws. The FRLA Board will evaluate the materiality of any waiver to determine whether amendment of this proxy statement/prospectus/consent solicitation statement and resolicitation of proxies is warranted. In some instances, if the FRLA Board determines that a waiver is not sufficiently material to warrant resolicitation of stockholders, FRLA has the discretion to complete the Business Combination without seeking further shareholder approval. For example, it is a condition to FRLA’s obligations to close the Business Combination that there be no applicable law and no injunction or other order restraining or imposing any condition on the consummation of the Business Combination, however, if the FRLA Board determines that any such order or injunction is not material to the business of WODI, then the FRLA Board may elect to waive that condition without shareholder approval and close the Business Combination.

FRLA’s stockholders will experience immediate dilution as a consequence of the issuance of Common Stock as consideration in the Business Combination. Having a minority share position may reduce the influence that FRLA’s current stockholders have on the management of FRLA.

Presuming no redemptions, it is anticipated that upon completion of the Business Combination, FRLA’s public stockholders will retain an ownership interest of approximately 38.1% in the Combined Company, the Sponsor, officers, directors and other holders of Founder Shares will retain an ownership interest of approximately 17.7% of the Combined Company, the Representatives will retain an ownership interest of approximately 1.4% of the Combined Company and the WODI shareholders will own approximately 42.8% of the Combined Company.

The ownership percentage with respect to the Combined Company assumes (i) that there are no redemptions of any Public Shares by the FRLA public stockholders, and (ii) there are no issuances of any additional shares upon the Closing of the Business Combination under the Incentive Plan. If the actual facts are different from these assumptions (which they are likely to be), the percentage ownership retained by the FRLA stockholders will be different. See the section titled “Unaudited Pro Forma Condensed Combined Financial Information.”

To mitigate the risk that FRLA might be deemed to be an investment company for purposes of the Investment Company Act, FRLA instructed Wilmington Trust, National Association, the trustee with respect to the Trust Account, to liquidate the investments held in the Trust Account and instead to hold the funds in the Trust Account

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in cash until the earlier of the consummation of FRLA’s initial business combination or FRLA’s liquidation. As a result, following such liquidation of investments in the Trust Account, FRLA will receive less interest on the funds held in the Trust Account than it would have received had it not liquidated such investments in the Trust Account, which would reduce the dollar amount FRLA’s public stockholders would receive upon any redemption or liquidation of FRLA.

The funds in the Trust Account had, since the IPO, been held only in U.S. government treasury obligations with a maturity of 185 days or less or in money market funds investing solely in U.S. government treasury obligations and meeting certain conditions under Rule 2a-7 under the Investment Company Act. However, on September 28, 2023, to mitigate the risk of FRLA being deemed to be an unregistered investment company (including under the subjective test of Section 3(a)(1)(A) of the Investment Company Act) and thus subject to regulation under the Investment Company Act, FRLA instructed Wilmington Trust, National Association, the trustee with respect to the Trust Account, to liquidate the investments held in the Trust Account and instead to hold the funds in the Trust Account in cash until the earlier of the consummation of FRLA’s initial business combination or liquidation. Following such liquidation, FRLA will receive less interest on the funds held in the Trust Account than the interest it would have received pursuant to its original Trust Account investments; however, interest previously earned on the funds held in the Trust Account still may be released to FRLA to pay its taxes, if any, and certain other expenses as permitted. Consequently, the transfer of the funds in the Trust Account to cash could reduce the dollar amount FRLA’s public stockholders would receive upon any redemption or liquidation.

In the event that FRLA is deemed to be an investment company, it may be required to liquidate.

Risks Related to Combined Company’s Common Stock and the Securities Market

The Combined Company’s stock price may fluctuate significantly.

The market price of the Combined Company’s Common Stock may fluctuate widely, depending on many factors, some of which may be beyond our control, including:

·actual or anticipated fluctuations in our results of operations due to factors related to its business; 

·success or failure of its business strategies; 

·competition and industry capacity; 

·changes in interest rates and other factors that affect earnings and cash flow; 

·its level of indebtedness, its ability to make payments on or service its indebtedness and its ability to obtain financing as needed; 

·its ability to retain and recruit qualified personnel; 

·its quarterly or annual earnings, or those of other companies in its industry; 

·announcements by us or its competitors of significant acquisitions or dispositions; 

·changes in accounting standards, policies, guidance, interpretations or principles; 

·the failure of securities analysts to cover, or positively cover, its Common Stock after the Business Combination; 

·changes in earnings estimates by securities analysts or its ability to meet those estimates; 

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·the operating and stock price performance of other comparable companies; 

·investor perception of the company and its industry; 

·overall market fluctuations unrelated to its operating performance; 

·results from any material litigation or government investigation; 

·changes in laws and regulations (including tax laws and regulations) affecting its business; 

·changes in capital gains taxes and taxes on dividends affecting stockholders; and 

·general economic conditions and other external factors. 

Low trading volume for the Combined Company’s Common Stock, which may occur if an active trading market does not develop, among other reasons, would amplify the effect of the above factors on stock price volatility.

Should the market price of our shares drop significantly, stockholders may institute securities class action lawsuits against us. A lawsuit against the Combined Company could cause the Combined Company to incur substantial costs and could divert the time and attention of its management and other resources.

Your percentage ownership in the Combined Company may be diluted in the future.

Stockholders’ percentage ownership in the Company may be diluted in the future because of equity issuances for acquisitions, capital market transactions or otherwise, including equity awards that the Combined Company will be granting to directors, officers and other employees. The FRLA Board has adopted the Incentive Plan subject to stockholder approval, for the benefit of certain of our current and future employees, service providers and non-employee directors. Such awards will have a dilutive effect on our earnings per share, which could adversely affect the market price of our Common Stock.

From time-to-time, the Combined Company may opportunistically evaluate and pursue acquisition opportunities, including acquisitions for which the consideration thereof may consist partially or entirely of newly-issued shares of Combined Company common stock and, therefore, such transactions, if consummated, would dilute the voting power and/or reduce the value of our common stock.

An active, liquid trading market for the Combined Company’s Common Stock may not develop, which may limit your ability to sell your shares.

An active trading market for the Combined Company’s shares of Common Stock may never develop or be sustained following the consummation of the Business Combination. A public trading market having the desirable characteristics of depth, liquidity and orderliness depends upon the existence of willing buyers and sellers at any given time, such existence being dependent upon the individual decisions of buyers and sellers over which neither the Combined Company nor any market maker has control. The failure of an active and liquid trading market to develop and continue would likely have a material adverse effect on the value of the Combined Company’s Common Stock. An inactive market may also impair the Combined Company’s ability to raise capital to continue to fund operations by issuing shares and may impair the Combined Company’s ability to acquire other companies or technologies by using the Combined Company’s shares as consideration.

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The issuance of additional shares of common stock or convertible securities will likely dilute your ownership and could adversely affect the stock price.

From time to time in the future, the Combined Company will likely issue additional shares of common stock or securities convertible into common stock pursuant to a variety of transactions, including acquisitions. Additional shares of common stock may also be issued upon exercise of outstanding stock options and warrants to purchase Common Stock. The issuance by us of additional shares of Common Stock or securities convertible into Common Stock would dilute your ownership of the Combined Company and the sale of a significant amount of such shares in the public market could adversely affect prevailing market prices of our Common Stock. Subject to the satisfaction of vesting conditions and the expiration of lockup agreements, shares issuable upon exercise of options will be available for resale immediately in the public market without restriction.

Issuing additional shares of the Combined Company’s capital stock, other equity securities, or securities convertible into equity would dilute the economic and voting rights of our existing stockholders, could reduce the market price of our Common Stock, or both. Debt securities convertible into equity could be subject to adjustments in the conversion ratio pursuant to which certain events may increase the number of equity securities issuable upon conversion. Preferred stock, if issued, could have a preference with respect to liquidating distributions or a preference with respect to dividend payments that could limit our ability to pay dividends to the holders of our Common Stock. The Combined Company’s decision to issue securities in any future offering will depend on market conditions and other factors beyond our control, which may adversely affect the amount, timing, or nature of our future offerings. As a result, holders of the Combined Company’s Common Stock bear the risk that the Combined Company’s future offerings may reduce the market price of the Combined Company’s Common Stock and dilute their percentage ownership.

Future sales, or the perception of future sales, of the Combined Company’s Common Stock by the Combined Company or its existing stockholders in the public market could cause the market price for the Combined Company’s Common Stock to decline.

The sale of substantial amounts of shares of the Combined Company’s Common Stock in the public market, or the perception that such sales could occur, could harm the prevailing market price of shares of Common Stock. These sales, or the possibility that these sales may occur, also might make it more difficult for us to sell equity securities in the future at a time and at a price that we deem appropriate.

In connection with the Business Combination, certain of FRLA’s stockholders, including the Sponsor and its affiliates, agreed that, subject to certain exceptions, they will not, during the period beginning at the effective time of the Business Combination and the date that is six months after the date of the Business Combination (subject to early release if WODI consummates a liquidation, merger, share exchange or other similar transaction with an unaffiliated third party), directly or indirectly, offer, sell, contract to sell, pledge, grant any option to purchase, make any short sale, or otherwise dispose of any shares of Common Stock, or any options or warrants to purchase any shares of Common Stock, or any securities convertible into, exchangeable for, or that represent the right to receive shares of Common Stock, or any interest in any of the foregoing.

Upon the expiration or waiver of the lock-up described above, shares held by these stockholders will be eligible for resale, subject to, in the case of stockholders who are our affiliates, volume, manner of sale, and other limitations under Rule 144 promulgated under the Securities Act; provided, however, stockholders may only rely on Rule 144 commencing one year after the Combined Company has filed current “Form 10” information with the SEC and reflecting its status as an entity that is no longer a shell company and so long as the Combined Company remains current in its reporting obligations.

In addition, certain of our stockholders will have registration rights under a registration rights agreement to be entered into prior to the Closing pursuant to which we are obligated to register such stockholders’ shares of Common Stock and other securities that such stockholders may acquire after the Closing. Upon the effectiveness of the applicable registration statement, these shares of Common Stock will be available for resale without restriction, subject to any lock-up agreement.

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The market price of shares of our Common Stock could drop significantly if the holders of the shares described above sell them or are perceived by the market as intending to sell them. These factors could also make it more difficult for us to raise additional funds through future offerings of shares of our Common Stock or other securities.

If securities or industry analysts publish inaccurate or unfavorable research or reports about the Combined Company’s business, its stock price and trading volume could decline.

The trading market for the Common Stock depends, in part, on the research and reports that third-party securities analysts publish about us and the industries in which we operate. We may be unable or slow to attract research coverage and if one or more analysts cease coverage of us, the price and trading volume of our securities would likely be negatively impacted. If any of the analysts that may cover us change their recommendation regarding our Common Stock adversely, or provide more favorable relative recommendations about our competitors, the price of our Common Stock would likely decline. If any analyst that may cover us ceases covering us or fails to regularly publish reports on us, we could lose visibility in the financial markets, which could cause the price or trading volume of our Common Stock to decline. Moreover, if one or more of the analysts who cover us downgrades our Common Stock, or if our reporting results do not meet their expectations, the market price of our Common Stock could decline.

The Combined Company may be subject to securities litigation, which is expensive and could divert management attention.

Following the Business Combination, the per share price of the Common Stock may be volatile and, in the past, some of the companies that have experienced volatility in the market price of their stock have been subject to securities litigation, including class action litigation. Litigation of this type could result in substantial costs and diversion of management’s attention and resources, which could have a material adverse effect on FRLA’s business, financial condition, and results of operations. Any adverse determination in litigation could also subject the Company to significant liabilities.

Risks Related to U.S. and International Taxation Generally and in Connection with the Business Combination

Changes in tax laws or exposure to additional income tax liabilities could affect WODI’s future profitability.

Factors that could materially affect WODI’s future effective tax rates include but are not limited to:

·changes in tax laws or the regulatory environment; 

·changes in accounting and tax standards or practices; 

·changes in the composition of operating income by tax jurisdiction; and 

·WODI’s operating results before taxes. 

Because WODI does not have a long history of operating at its present scale and it has significant expansion plans, WODI’s effective tax rate may fluctuate in the future. Future effective tax rates could be affected by operating losses in jurisdictions where no tax benefit can be recorded under GAAP, changes in the composition of earnings in countries with differing tax rates, changes in deferred tax assets and liabilities, or changes in tax laws.

On December 22, 2017, the Tax Cuts and Jobs Act of 2017 (the “Tax Act”), was signed into law making significant changes to the Internal Revenue Code of 1986, as amended (the “Code”). In particular, sweeping changes were made to the U.S. taxation of foreign operations. Changes include, but are not limited to, a permanent reduction to the corporate income tax rate, limiting interest deductions, adopting elements of a territorial tax system, assessing a repatriation tax or “toll-charge” on undistributed earnings and profits of U.S.-owned foreign corporations, and

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introducing certain anti-base erosion provisions, including a new minimum tax on global intangible low-taxed income and base erosion and anti-abuse tax. The new legislation had no effect on WODI’s 2022 provision for income taxes because the Company incurred losses in the U.S. in these years, and the management set up a full valuation allowance against its U.S. federal and states deferred tax assets.

In addition to the impact of the Tax Act on WODI’s federal taxes, the Tax Act may impact its taxation in other jurisdictions, including with respect to state income taxes. State legislatures have not had sufficient time to respond to the Tax Act. Accordingly, there is uncertainty as to how the laws will apply in the various state jurisdictions. Additionally, other foreign governing bodies may enact changes to their tax laws that could result in changes to WODI’s global tax position and materially adversely affect its business, results of operations and financial condition. Additionally, the IRS and several foreign tax authorities have increasingly focused attention on intercompany transfer pricing with respect to sales of products and technologies and the use of intangibles. Tax authorities could disagree with WODI’s future intercompany charges, cross-jurisdictional transfer pricing or other matters and assess additional taxes. If WODI does not prevail in any such disagreements, its profitability may be affected.

WODI’s ability to use its net operating loss carryforwards and certain other tax attributes may be limited.

As of December 31, 2022, WODI had approximately $0.2 million of U.S. federal and $0 of state net operating loss carryforwards available to reduce future taxable income. Of the approximately $0.2 million in U.S. federal net operating loss carryforwards, $0 will be carried forward indefinitely for U.S. federal tax purposes. It is possible that WODI will not generate taxable income in time to use these net operating loss carryforwards before their expiration or at all. Under legislative changes made in December 2017, U.S. federal net operating losses incurred in 2018 and in future years may be carried forward indefinitely, but the deductibility of such net operating losses is limited. It is uncertain if and to what extent various states will conform to the newly enacted federal tax law. In addition, the federal and state net operating loss carryforwards and certain tax credits may be subject to significant limitations under Section 382 and Section 383 of the Code, respectively, and similar provisions of state law. Under those sections of the Code, if a corporation undergoes an “ownership change,” the corporation’s ability to use its pre-change net operating loss carryforwards and other pre-change attributes, such as research tax credits, to offset its post-change income or tax may be limited. In general, an “ownership change” will occur if there is a cumulative change in WODI’s ownership by “5-percent shareholders” that exceeds 50 percentage points over a rolling three-year period. Similar rules may apply under state tax laws. WODI has not yet undertaken an analysis of whether the Business Combination constitutes an “ownership change” for purposes of Section 382 and Section 383 of the Code. In addition, certain U.S. states have imposed additional limitations on the use of net operating loss carryforwards not otherwise imposed on the use of U.S. federal net operating loss carryforwards and may impose additional limitations in the future.

Unanticipated changes in effective tax rates or adverse outcomes resulting from examination of our income or other tax returns could adversely affect our financial condition and results of operations.

We are subject to income taxes in the United States and other jurisdictions, and our tax liabilities will be subject to the allocation of expenses in differing jurisdictions. Our future effective tax rates could be subject to volatility or adversely affected by a number of factors, including:

·changes in the valuation of our deferred tax assets and liabilities; 

·expected timing and amount of the release of any tax valuation allowances; 

·tax effects of stock-based compensation; 

·costs related to intercompany restructurings; 

·changes in tax laws, regulations or interpretations thereof; or 

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·lower than anticipated future earnings in jurisdictions where we have lower statutory tax rates and higher than anticipated future earnings in jurisdictions where we have higher statutory tax rates. 

In addition, we may be subject to audits of our income, sales and other transaction taxes by taxing authorities. Outcomes from these audits could have an adverse effect on our financial condition and results of operations.

If the Business Combination does not qualify as a tax-free reorganization under Section 368(a) of the Code, holders of WODI Common Stock may incur a substantially greater U.S. federal income tax liability as a result of the Business Combination.

FRLA and WODI intend for the Business Combination to be treated for U.S. federal income tax purposes as a reorganization within the meaning of Section 368(a) of the Code. However, neither FRLA nor WODI has requested, or intends to request, an opinion of tax counsel or a ruling from the IRS, with respect to the tax consequences of the Business Combination and there can be no assurance that the companies’ position would be sustained by a court if challenged by the IRS. Accordingly, if the IRS or a court determines that the Business Combination does not qualify as a reorganization under Section 368(a) of the Code and is therefore fully taxable for U.S. federal income tax purposes, holders of WODI Common Stock generally would recognize taxable gain or loss on their receipt of Common Stock in connection with the Business Combination. For a more complete discussion of U.S. federal income tax consequences of the Business Combination, see the section titled “Material U.S. Federal Income Tax Consequences — Tax Consequences of the Business Combination to U.S. Holders of WODI Common Stock.”

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THE FRLA SPECIAL MEETING

General

FRLA is furnishing this proxy statement/prospectus/consent solicitation statement to its stockholders as part of the solicitation of proxies by the FRLA Board for use at the FRLA Special Meeting to be held virtually at [     ] a.m. Eastern Time, on [     ], 2024, and at any adjournment or postponement thereof. This proxy statement/prospectus/consent solicitation statement provides FRLA stockholders with information they need to know to be able to vote or direct their vote to be cast at the extraordinary general meeting.

Date, Time and Place of the FRLA Special Meeting

The FRLA Special Meeting will be held virtually at [     ] a.m. Eastern Time, on [     ], 2024. FRLA has determined that the extraordinary general meeting will be a virtual meeting conducted via live webcast at https:// [     ] in order to facilitate stockholder attendance and participation.

Purpose of the Special Meeting

During the FRLA Special Meeting, FRLA’s stockholders will be asked to consider and vote upon the following proposals:

·To consider and vote upon a proposal to approve the transactions contemplated under the Business Combination Agreement, dated as of October 24, 2023, by and among FRLA, Merger Sub, and WODI, as amended February 6, 2024, a copy of which is attached to this proxy statement/prospectus/consent solicitation statement as Annex A. This Proposal is referred to as the “FRLA Business Combination Proposal” or “FRLA Proposal 1.” 

·To consider and vote upon a proposal to approve the Amended Charter, a copy of which is attached to this proxy statement/prospectus/consent solicitation statement as Annex B. This Proposal is referred to as the “FRLA Charter Amendment Proposal” or “FRLA Proposal 2.” 

·To consider and vote upon, on a non-binding basis, certain differences between FRLA’s Current Charter and the Amended Charter, a copy of which is attached to this proxy statement/prospectus/consent solicitation statement as Annex B, for the following amendments (collectively, the “FRLA Advisory Charter Proposals” or “FRLA Proposal 3”): 

oChange to Authorized Capital Stock – to increase the total number of shares the Combined Company is authorized to issue (“Advisory Proposal 3A”); 

oRight of Stockholders to Act by Written Consent – to provide the right of the stockholders of the Combined Company to act by written consent except to the extent otherwise provided in our bylaws (“Advisory Proposal 3B”); and 

oRight of Stockholders to Call Meetings– to provide the right of the stockholders of the Combined Company to call a special meeting to the extent otherwise provided in our bylaws (“Advisory Proposal 3C”). 

·To consider a vote upon a proposal to approve the Incentive Plan, a copy of which is attached to this proxy statement/prospectus/consent solicitation statement as Annex D, to be effective upon the consummation of the Business Combination. This Proposal is referred to as the “FRLA Incentive Plan Proposal” or “FRLA Proposal 4.” 

·To consider a vote upon a proposal to elect T. Riggs Eckelberry, Stephen Hall, Taron Lexton, Beau Vuillemot, Leslie Brock, and Jean-Louis Kindler as members of the Board of Directors effective as of the Closing until the expiration of their respective terms and until their respective successors are duly  

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appointed and qualified. This Proposal is called the “FRLA Director Election Proposal” or “FRLA Proposal 5.”

·To consider and vote upon a proposal to approve the issuance of the Common Stock in connection with transactions contemplated in the Business Combination Agreement as required by Nasdaq listing requirements. This Proposal is referred to as the “FRLA Nasdaq Proposal” or “FRLA Proposal 6.” 

·To consider a vote upon a proposal to approve the adjournment of the FRLA Special Meeting by the chairman thereof to a later date, if necessary, under certain circumstances, including for the purpose of soliciting additional proxies in favor of the foregoing Proposals. This Proposal is called the “FRLA Adjournment Proposal” or “FRLA Proposal 7.” 

Recommendation of the FRLA Board

The FRLA Board believes that the FRLA Business Combination Proposal, the FRLA Charter Amendment Proposal, the FRLA Advisory Charter Proposals, the FRLA Incentive Plan Proposal, the FRLA Director Election Proposal, the FRLA Nasdaq Proposal and the FRLA Adjournment Proposal are in the best interest of FRLA’s stockholders and unanimously recommends that its stockholders vote “FOR” the approval of the FRLA Business Combination Proposal, vote “FOR” the approval of the FRLA Charter Amendment Proposal, vote “FOR” the approval of the FRLA Advisory Charter Proposals, vote “FOR” the approval of the FRLA Incentive Plan Proposal, vote “FOR” the approval of the FRLA Director Election Proposal, vote “FOR” the approval of the FRLA Nasdaq Proposal and “FOR” the approval of the Adjournment Proposal.

The existence of financial and personal interests of one or more of FRLA’s directors may result in a conflict of interest on the part of such director(s) between what he, she or they may believe is in the best interests of FRLA and its stockholders and what he, she or they may believe is best for himself, herself or themselves in determining to recommend that stockholders vote for the proposals. In addition, FRLA’s officers have interests in the Business Combination that may conflict with your interests as a stockholder.

Record Date; Who is Entitled to Vote

FRLA stockholders will be entitled to vote or direct votes to be cast at the extraordinary general meeting if they owned FRLA Shares at the close of business on [     ], 2024, which is the “Record Date” for the special meeting. Stockholders will have one vote for each FRLA Share owned at the close of business on the Record Date. If your shares are held in “street name” or are in a margin or similar account, you should contact your broker to ensure that votes related to the shares you beneficially own are properly counted. As of the close of business on the Record Date, there were 6,271,798 FRLA Shares issued and outstanding.

Certain holders of FRLA Shares which are affiliates of directors and officers of FRLA have agreed to, among other things, vote in favor of the Business Combination. As of the date of this proxy statement/prospectus/consent solicitation statement, such holders own [     ]% of the issued and outstanding FRLA Shares.

Quorum

A quorum of FRLA stockholders is necessary to hold a valid meeting. A quorum will be present at the FRLA special meeting if the holders of a majority of the issued and outstanding FRLA Shares entitled to vote at the special meeting are represented in person or by proxy. As of the Record Date for the FRLA special meeting, 3,135,900 shares would be required to achieve a quorum.

Abstentions and Broker Non-Votes

Proxies that are marked “abstain” and proxies relating to “street name” shares that are returned to FRLA but marked by brokers as “not voted” will be treated as shares present for purposes of determining the presence of a quorum on all matters, but they will not be treated as shares voted on the matter. Under the rules of various national

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and regional securities exchanges, your broker, bank, or nominee cannot vote your shares with respect to non-discretionary matters unless you provide instructions on how to vote in accordance with the information and procedures provided to you by your broker, bank, or nominee. FRLA believes all the proposals presented to the stockholders will be considered non-discretionary and therefore your broker, bank, or nominee cannot vote your shares without your instruction.

Vote Required for Approval

The approval of the FRLA Business Combination Proposal requires the affirmative vote of the majority of the issued and outstanding FRLA Shares present by virtual attendance or represented by proxy and entitled to vote at the FRLA Special Meeting. An abstention will have the effect of a vote “AGAINST” Proposal 1. Broker non-votes will have no effect on the vote for Proposal 1.

The approval of the FRLA Charter Amendment Proposal requires the affirmative vote of the majority of the issued and outstanding FRLA Shares. Abstentions and broker non-votes will have the effect of a vote “AGAINST” Proposal 2.

The approval of the FRLA Advisory Charter Proposals require the affirmative vote of a majority of the voting power of the FRLA Shares. Abstentions will have the effect of a vote “AGAINST” Proposal 3. Broker non-votes will have no effect on the vote for Proposal 3.

The approval of the FRLA Incentive Plan Proposal requires the affirmative vote of the majority of the issued and outstanding FRLA Shares present in person by virtual attendance or represented by proxy and entitled to vote. Abstentions will have the effect of a vote “AGAINST” Proposal 4. Broker non-votes will have no effect on the vote for Proposal 4.

Directors are elected by a plurality of all of the votes cast by the stockholders present in person (which would include presence at a virtual meeting) or represented by proxy at the FRLA Special Meeting. This means that the six director nominees who receive the most affirmative votes will be elected. Stockholders may not cumulate their votes with respect to the election of directors. Abstentions and broker non-votes will have no effect on the vote for Proposal 5.

The approval of the FRLA Nasdaq Proposal requires the affirmative vote of the majority of the issued and outstanding FRLA Shares present by virtual attendance or represented by proxy and entitled to vote at the FRLA Special Meeting. Abstentions will have the effect of a vote “AGAINST” Proposal 6. Broker non-votes will have no effect on the vote for Proposal 6.

The approval of the FRLA Adjournment Proposal requires the affirmative vote of the majority of the issued and outstanding FRLA Shares present in person by virtual attendance or represented by proxy and entitled to vote at the FRLA Special Meeting. Abstentions will have the effect of a vote “AGAINST” Proposal 7. Broker-non votes have no effect on the vote for Proposal 7.

Voting Your Shares

Each FRLA Share that you own in your name entitles you to one vote. Your proxy card shows the number of FRLA Shares that you own.

If you are a record owner of your shares, there are two ways to vote your FRLA Shares at the extraordinary general meeting:

You Can Vote By Signing and Returning the Enclosed Proxy Card. If you vote by proxy card, your “proxy,” whose name is listed on the proxy card, will vote your shares as you instruct on the proxy card. If you sign and return the proxy card but do not give instructions on how to vote your shares, your shares will be voted as recommended by

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the FRLA Board, “FOR” the approval of the FRLA Business Combination Proposal, “FOR” the approval of the FRLA Charter Amendment Proposal, “FOR” the approval of the FRLA Advisory Charter Proposals, “FOR” the approval of the FRLA incentive plan Proposal, “FOR” the approval of the FRLA Director Election Proposal, “FOR” the approval of the FRLA Nasdaq Proposal, and “FOR” the approval of the FRLA Adjournment Proposal, in each case, if presented to the special meeting. Votes received after a matter has been voted upon at the special meeting will not be counted.

You Can Attend the Special Meeting and Vote in Person. If your shares are registered in your name with VStock and you wish to attend the special meeting, go to https://[___], enter the control number included on your proxy card or notice of the special meeting and [click on the “Click here to preregister for the online meeting” link at the top of the page]. Just prior to the start of the special meeting you will need to log back into the special meeting site using your control number. Pre-registration is recommended but is not required in order to attend.

Beneficial stockholders (those holding shares through a stock brokerage account or by a bank or other holder of record) who wish to attend the special meeting must obtain a legal proxy by contacting their account representative at the bank, broker, or other nominee that holds their shares and e-mail a copy (a legible photograph is sufficient) of their legal proxy to [     ]. Beneficial stockholders who e-mail a valid legal proxy will be issued a meeting control number that will allow them to register to attend and participate in the extraordinary general meeting. After contacting the Transfer Agent, a beneficial holder will receive an e-mail prior to the special meeting with a link and instructions for entering the special meeting. Beneficial stockholders should contact the Transfer Agent at least [five] business days prior to the special meeting date in order to ensure access.

If your shares are held in “street name” or are in a margin or similar account, you should contact your broker to ensure that votes related to the shares you beneficially own are properly counted. If you wish to attend the meeting and vote in person or online and your shares are held in “street name,” you must obtain a legal proxy from your broker, bank or nominee. That is the only way FRLA can be sure that the broker, bank or nominee has not already voted your shares.

Revoking Your Proxy

If you are a FRLA stockholder and you give a proxy, you may revoke it at any time before it is exercised by doing any one of the following:

·you may send another proxy card with a later date; 

·you may notify [     ] in writing before the special meeting that you have revoked your proxy; or 

·you may attend the special meeting, revoke your proxy, and vote, as indicated above. 

If your shares are held in “street name” or are in a margin or similar account, you should contact your broker for information on how to change or revoke your voting instructions.

Who Can Answer Your Questions about Voting Your Shares

If you have any questions about how to vote or direct a vote in respect of your FRLA shares, you may contact [     ], FRLA’s proxy solicitor, as follows:

[     ]

No Additional Matters May Be Presented at the FRLA Meeting

The FRLA Meeting has been called only to consider the approval of the FRLA Business Combination Proposal, the FRLA Charter Amendment Proposal, the FRLA Advisory Charter Proposals, the FRLA Incentive Plan

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Proposal, the FRLA Director Election Proposal, the FRLA Nasdaq Proposal, and the FRLA Adjournment Proposal. Under FRLA’s Current Charter and Bylaws, other than procedural matters incident to the conduct of the FRLA Special Meeting, no other matters may be considered at the FRLA Special Meeting if they are not included in the notice of the FRLA Special Meeting.

Approval of the FRLA Business Combination Proposal, the FRLA Advisory Charter Proposals, the FRLA Incentive Plan Proposal, the FRLA Nasdaq Proposal, and the FRLA Adjournment Proposal each requires the affirmative vote of a majority of votes cast on the Proposal.

Approval of the FRLA Charter Amendment Proposal requires the affirmative vote of a majority of the issued and outstanding FRLA Shares.

Directors are elected by a plurality of all of the votes cast by the stockholders present in person (which would include presence at a virtual meeting) or represented by proxy at the FRLA Special Meeting. This means that the six director nominees who receive the most affirmative votes will be elected.

Redemption Rights

Pursuant to FRLA’s Certificate of Incorporation, a holder of Public Shares may demand that FRLA redeem such Public Shares for cash in connection with a business combination. You may not elect to redeem your Public Shares prior to the completion of a business combination.

If you are a public stockholder and you seek to have your shares redeemed, you must submit your request in writing that we redeem your Public Shares for cash no later than [     ] a.m., Eastern Time on [     ], 2024 (at least two business days before the FRLA Special Meeting). The request must be signed by the applicable stockholder in order to validly request redemption. A stockholder is not required to submit a proxy card or vote in order to validly exercise redemption rights. The request must identify the holder of the Public Shares to be redeemed and must be sent to VStock at the following address:

VStock Transfer, LLC

18 Lafayette Place

Woodmere, New York 11598

Attn: 0-K Team

E-mail: info@vstocktransfer.com

 

You must tender the Public Shares for which you are electing redemption at least two business days before the FRLA Special Meeting by either:

·Delivering certificates representing the Public Shares to VStock, or 

·Delivering the Public Shares electronically through the DWAC system. 

Any corrected or changed written demand of redemption rights must be received by VStock at least two business days before the FRLA Special Meeting. No demand for redemption will be honored unless the holder’s Public Shares have been delivered (either physically or electronically) to VStock at least two business days prior to the vote at the FRLA Special Meeting.

Public stockholders may seek to have their Public Shares redeemed regardless of whether they vote for or against the Business Combination and whether or not they are holders of Public Shares as of the Record Date. Any public stockholder who holds Public Shares of FRLA on or before [     ], 2024 (at least two business days before the FRLA Special Meeting) will have the right to demand that his, her or its Public Shares be redeemed for a pro rata share of the aggregate amount then on deposit in the Trust Account, less any taxes then due but not yet paid, at the consummation of the Business Combination.

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In connection with tendering your Public Shares for redemption, you must elect either to physically tender your certificates to VStock or deliver your Public Shares to VStock electronically using DTC’s DWAC (Deposit/Withdrawal At Custodian) System, in each case, at least two business days before the FRLA Special Meeting.

If you wish to tender through the DWAC system, please contact your broker and request delivery of your Public Shares through the DWAC system. Delivering Public Shares physically may take significantly longer. In order to obtain a physical certificate, a stockholder’s broker and/or clearing broker, DTC, and VStock will need to act together to facilitate this request. It is FRLA’s understanding that stockholders should generally allot at least two weeks to obtain physical certificates from VStock. FRLA does not have any control over this process or over the brokers or DTC, and it may take longer than two weeks to obtain a physical certificate. Stockholders who request physical certificates and wish to redeem may be unable to meet the deadline for tendering their Public Shares before exercising their redemption rights and thus will be unable to redeem their Public Shares.

In the event that a stockholder tenders its Public Shares and decides prior to the consummation of the Business Combination that it does not want to redeem its Public Shares, the stockholder may withdraw the tender. In the event that a stockholder tenders Public Shares and the Business Combination is not completed, these Public Shares will not be redeemed for cash and the physical certificates representing these Public Shares will be returned to the stockholder promptly following the determination that the Business Combination will not be consummated. FRLA anticipates that a stockholder who tenders Public Shares for redemption in connection with the vote to approve the Business Combination would receive payment of the redemption price for such Public Shares soon after the completion of the Business Combination.

If properly demanded by FRLA’s public stockholders, FRLA will redeem each Public Share into a pro rata portion of the funds available in the Trust Account, calculated as of two business days prior to the anticipated consummation of the Business Combination. As of [     ], 2024, this would amount to approximately $[     ] per Public Share. If you exercise your redemption rights, you will be exchanging your Public Shares for cash and will no longer own the Public Shares.

Notwithstanding the foregoing, a holder of the Public Shares, together with any affiliate of his or her or any other person with whom he or she is acting in concert or as a “group” (as defined in Section 13(d)-(3) of the Exchange Act) will be restricted from seeking redemption rights with respect to more than 20% of the Public Shares.

If too many public stockholders exercise their redemption rights, we may not be able to meet certain closing conditions, and as a result, would not be able to proceed with the Business Combination.

No Appraisal Rights

Appraisal rights are not available to security holders of FRLA in connection with the proposed Business Combination.

Proxy Solicitation

FRLA is soliciting proxies on behalf of the FRLA Board. This solicitation is being made by mail but also may be made by telephone or in person. FRLA and its directors, officers and employees may also solicit proxies in person, by telephone or by other electronic means. FRLA will file with the SEC all scripts and other electronic communications as proxy soliciting materials. FRLA will bear the cost of the solicitation.

FRLA has engaged [     ] to assist in the proxy solicitation process and will pay [     ] a fee of $[     ], plus disbursements.

FRLA will ask banks, brokers and other institutions, nominees and fiduciaries to forward the proxy materials to their principals and to obtain their authority to execute proxies and voting instructions. FRLA will reimburse them for their reasonable expenses.

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FRLA Stockholders

As of the date of this proxy statement/prospectus/consent solicitation statement, there are 6,271,798 FRLA Shares issued and outstanding, including 3,828,048 shares of FRLA Class A Common Stock and 2,443,750 shares of FRLA Class B Common Stock.

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FRLA PROPOSAL 1 – THE FRLA BUSINESS COMBINATION PROPOSAL

We are asking our stockholders to adopt the Business Combination Agreement and approve the Business Combination and the other transactions contemplated thereby. Our stockholders should read carefully this proxy statement/prospectus/consent solicitation statement in its entirety, including the subsection below titled “The Business Combination Agreement,” for more detailed information concerning the Business Combination and the terms and conditions of the Business Combination Agreement. We also urge our stockholders to read carefully the Business Combination Agreement in its entirety before voting on this Proposal. A copy of the Business Combination Agreement is attached as Annex A to this proxy statement/prospectus/consent solicitation statement.

General

On October 24, 2023, FRLA, entered into a Business Combination Agreement (the “Business Combination Agreement”) by and among FRLA, Merger Sub, and WODI, as amended February 6, 2024. Pursuant to the terms of the Business Combination Agreement, a Business Combination between FRLA and WODI will be effected through the merger of Merger Sub with and into WODI, with WODI surviving the merger as a wholly-owned subsidiary of FRLA. The Combined Company will change its name to “Water on Demand, Inc.” The Board has (i) approved and declared advisable the Business Combination Agreement, the Business Combination and the other transactions contemplated thereby and (ii) resolved to recommend approval of the Business Combination Agreement and related transactions by the stockholders of FRLA.

The Business Combination Agreement

The following is a summary of the material terms of the Business Combination Agreement. The following summary does not purport to be complete and is qualified in its entirety by reference to the Business Combination Agreement, a copy of which is attached as Annex A to this proxy statement/prospectus/consent solicitation statement.

The Business Combination Agreement contains representations and warranties that FRLA and Merger Sub, on the one hand, and WODI, on the other hand, have made to one another as of specific dates. The assertions embodied in the representations and warranties are qualified by information in confidential disclosure schedules exchanged by the parties. Some of these schedules contain information that modifies, qualifies and creates exceptions to the representations and warranties set forth in the Business Combination Agreement. You should not rely on the representations and warranties described below as current characterizations of factual information about FRLA or WODI, because they were made as of specific dates, may be intended merely as a risk allocation mechanism between FRLA and Merger Sub, and WODI and are modified by the disclosure schedules.

Merger Consideration

If the FRLA Business Combination Proposal is approved, pursuant to the Business Combination Agreement, at the Effective Time, (A) each share of FRLA Class A Common Stock and each share of FRLA Class B Common Stock (other than such shares of FRLA Class B Common Stock held by the Sponsor which were forfeited pursuant to the Sponsor Letter Agreement) that is issued and outstanding immediately prior to the Merger shall become one share of Common Stock, (B) each share of capital stock of Merger Sub issued and outstanding immediately prior to the Effective Time will be automatically cancelled and extinguished and converted into one share of WODI Common Stock; (C) each share of WODI Preferred Stock shall convert to WODI Common Stock in accordance with the terms thereof immediately prior to the Effective Time; (D) each share of WODI Common Stock (other than the WODI Common Stock held as treasury stock by WODI) issued and outstanding as of immediately prior to the Effective Time shall be automatically canceled and extinguished and converted into the right to receive that number shares of Common Stock equal to the Merger Consideration (as defined below); (E) any shares of WODI Common Stock that are restricted or subject to vesting shall automatically vest and be converted into shares of Common Stock granted as part of the Merger Consideration; (F) certain convertible promissory notes issued by WODI shall convert into shares of WODI Common Stock; and (G) each share of WODI Common Stock held by WODI as treasury stock immediately

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prior to the Effective Time will be automatically canceled and extinguished, and no consideration shall be paid with respect thereto.

WODI shareholders shall be entitled to, with respect to each outstanding share of WODI Common Stock, a number of Merger Consideration Shares equal to the Exchange Ratio, where the Exchange Ratio is equal to the quotient of (A) (i) $32,000,000, divided by (ii) the sum of the aggregate number of shares of WODI Common Stock outstanding immediately prior to the Effective Time, and (B) (i) the aggregate amount of cash on deposit in the Trust Account (without giving effect to the redemption of any shares by FRLA’s public stockholders) as of two business days prior to the Closing Date, including interest not previously released to FRLA to pay taxes of FRLA divided by (ii) the total number of then issued and outstanding FRLA Class A Common Stock (without giving effect to the redemption of any shares by FRLA’s public stockholders).

The total consideration to be received by WODI Security Holders at the Closing will be the issue of Class A Common stock with an aggregate value equal to $32,000,000.

Treatment of WODI Securities

Cancellation of Securities

Each share of WODI capital stock, if any, that is owned by FRLA, Merger Sub, WODI, or any of their subsidiaries (as treasury stock or otherwise) immediately prior to the Effective Time, will automatically be cancelled and retired without any conversion or consideration.

Common Stock

Each share of WODI Common Stock issued and outstanding immediately prior to the Effective Time (other than any such shares of WODI capital stock cancelled as described above and any dissenting shares) will be converted into the right to receive a number of shares of Common Stock equal to the Exchange Ratio.

Merger Sub Securities

Each share of WODI Common Stock that is subject to restricted stock grants shall automatically vest immediately prior to the Effective Time and thereafter shall be canceled and extinguished and converted into the right to receive that number shares of Common Stock equal to the Merger Consideration.

Directors and Executive Officers of the Combined Company Following the Business Combination

Each current member of the FRLA Board will cease to be a director upon the consummation of the Business Combination, except for Beau Vuillemot, who will remain a director on the Combined Company’s board of directors. Effective as of the Closing, the board of directors of the Combined Company will initially consist of six individuals: three persons that are designated by WODI prior to the Closing (the “WODI Director Designees”); and three persons that are mutually designated by FRLA and WODI prior to the Closing, each of whom shall be required to qualify as an independent director under the Nasdaq rules.  FRLA consented to the increase in the size of the board of directors of the Combined Company to six directors.

Covenants

The Business Combination Agreement includes customary covenants of the parties with respect to operation of their respective businesses prior to consummation of the Business Combination and efforts to satisfy conditions to consummation of the Business Combination. The Business Combination Agreement also contains additional covenants of the parties, including, among others, those with respect to access to certain information, notification of the occurrence of certain facts and circumstances, listing, indemnification, directors’ and officers’ insurance, and cooperation in the preparation of this proxy statement/prospectus/consent solicitation statement.

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Conditions to the Closing of the Business Combination

The consummation of the Business Combination is conditioned upon, among other things, (i) the absence of any applicable law or order restraining, prohibiting or imposing any condition on the consummation of the Business Combination and related transactions, (ii) the Form S-4 becoming effective in accordance with the provisions of the Securities Act, (iii) the conditional approval for listing by Nasdaq of the shares of Class A Common Stock to be issued in connection with the transactions contemplated by the Business Combination Agreement and the Subscription Agreements and satisfaction of initial and continued listing requirements, (iv) the election of certain individuals to the FRLA Board as set forth in the Business Combination Agreement, (v) approval by FRLA stockholders of the Business Combination and related transactions, (vi) approval by the WODI shareholders of the Business Combination and related transactions, (vii) solely with respect to FRLA and Merger Sub, (A) the fundamental representations and warranties of WODI being true and correct in all respects unless failure would not have or reasonably be expected to have a Material Adverse Effect (as defined in the Business Combination Agreement) on WODI or any of its subsidiaries, (B) WODI having duly performed or complied with all of its obligations under the Business Combination Agreement in all material respects, and (C) no event having occurred that would result in a Material Adverse Effect on WODI or any of its subsidiaries, and (viii) solely with respect to WODI, (A) the fundamental representations and warranties of FRLA and Merger Sub being true and correct in all respects unless failure would not have or reasonably be expected to have a Material Adverse Effect (as defined in the Business Combination Agreement) on FRLA or Merger Sub, (B) FRLA and Merger Sub having duly performed or complied with all of their respective obligations under the Business Combination Agreement in all material respects.

Representations and Warranties

The Business Combination Agreement contains representations and warranties of WODI relating to, among other things, corporate existence and power, corporate authorization, capitalization, indebtedness, non-contravention, consents, capital structure, organizational documents, assumed names, subsidiaries, financial statements, absence of certain changes, properties, title to WODI’s assets, litigation, contracts, licenses and permits, compliance with laws, intellectual property, customers and suppliers, employees and employee benefit plans, withholding, labor matters, real property, tax matters, environmental laws, finder’s fees, directors and officers, certain business practices, international trade matters, anti-bribery compliance, compliance with health care laws and certain contracts, insurance, related party transactions and data privacy matters.

The Business Combination Agreement contains representations and warranties of FRLA and Merger Sub relating to, among other things, corporate existence and power, corporate authorization, governmental authorization, non-contravention, finder’s fees, issuance of shares, capitalization, information supplied, FRLA’s Trust Account, related party transactions, listing, board approval, financial statements, absence of changes, litigation, compliance with laws, tax matters, and contracts.

None of the representations, warranties or covenants, including any rights upon breach of such representations, warranties or covenants will survive the Closing except for such covenants and agreements that by their terms expressly apply post-Closing.

Termination of the Business Combination Agreement

The Business Combination Agreement may be terminated at any time prior to the Effective Time as follows:

(i)by mutual written consent of FRLA and WODI; 

(ii)by either FRLA or WODI if the other party has breached any of its covenants or representations and warranties such that closing conditions would not be satisfied by the earlier of (A) the Outside Date and (B) 30 days following receipt by the breaching party of a written notice of the breach 

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(iii)by either FRLA or WODI if the Business Combination and related transactions are not consummated on or before the Outside Date, provided that, no party shall have the right to terminate the agreement for this cause if their own breach of covenants or obligations under the Business Combination Agreement was the proximate cause of the failure to consummate the Business Combination prior to the Outside Date; 

(iv)by either FRLA or WODI, if any Governmental Entity shall have issued an Order or taken any other action permanently enjoining, restraining or otherwise prohibiting the transactions contemplated by this Agreement and such Order or other action shall have become final and non-appealable; 

(v)by either FRLA or WODI if the FRLA Special Meeting, has been held (including any adjournment thereof), has concluded, and either FRLA’s stockholders have duly voted and failed to approve the Business Combination Agreement, the Business Combination and the related transactions or if WODI fails to obtain the approval of the WODI shareholders by the WODI Shareholder Consent; 

(vi)by WODI should FRLA not have timely taken such actions as are reasonably necessary pursuant to the Trust Agreement and the Governing Documents of FRLA to extend the period of time for it to complete an initial business combination for an additional period of an aggregate of six (6) months from May 5, 2023; provided, that WODI timely deposit into the Trust Account the funds required for such extension by the Trust Agreement; 

(vii)by FRLA should WODI not deposit into the Trust Account in a timely manner the funds necessary to extend the period for FRLA to complete an initial business combination for an additional period of an aggregate of six (6) months from May 5, 2023; and 

(viii)by FRLA should: (i) Nasdaq not approve the initial listing application for the combined company with Nasdaq in connection with the transactions contemplated by this Agreement; (ii) the combined company not have satisfied all applicable initial listing requirements of Nasdaq; or (iii) the common stock of the combined company not have been approved for listing on Nasdaq prior to the Closing Date. 

The foregoing summary of the Business Combination Agreement does not purport to be complete and is qualified in its entirety by reference to the actual Business Combination Agreement, which is filed as Annex A hereto, and which is incorporated by reference in this report. Terms used herein as defined terms and not otherwise defined herein shall have the meanings ascribed to them in the Business Combination Agreement.

Certain Related Agreements

Sponsor Letter Agreement. Concurrently with the execution of the Business Combination Agreement, the Sponsor, FRLA and WODI entered into a Letter Agreement (the “Sponsor Letter Agreement”), pursuant to which, among other things, the Sponsor agreed to (a) vote in favor of the Business Combination Agreement and the Business Combination, (b) waive any adjustment to the conversion ratio set forth in the Certificate of Incorporation or other governing documents of FRLA or any other anti-dilution or similar protection with respect to the FRLA Class B Common Stock, such that the FRLA Class B Common Stock will convert into Common Stock at the Closing on a one-to-one basis, and (c) subject certain of the FRLA Class B Common Stock currently held by the Sponsor and certain Class A Common Stock issuable to the Sponsor on exercise of a warrant owned by the Sponsor to potential forfeiture, in each case, on the terms and subject to the conditions set forth in the Sponsor Letter Agreement.

Incentive Plan. FRLA has agreed to approve and adopt an equity incentive plan (the “Incentive Plan”) to be effective as of the Closing and in a form mutually acceptable to FRLA and WODI, subject to approval of the Incentive Plan by

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the FRLA’s stockholders. The Incentive Plan will provide for an initial aggregate share reserve equal to 10% of the number of shares of common stock on a fully diluted basis at the Closing.

Interests of FRLA’s Directors and Officers in the Business Combination

When FRLA stockholders and other interested persons consider the recommendation of its board of directors in favor of approval of the Business Combination, such persons should keep in mind that the directors and executive officers of FRLA may have interests in the Business Combination and other proposals that may be different from, or in addition to, those of FRLA stockholders generally. These interests include, among other things:

·The Sponsor is owned by WODI, and as such the Sponsor has a direct interest in the completion of the Business Combination. As the Sponsor, WODI has expended significant capital in the form of extension payments and other costs in furtherance of the Business Combination. 

·If an initial business combination, such as the Business Combination, is not completed by November 5, 2024, FRLA will be required to dissolve and liquidate. In such event, the Founder Shares will be worthless because holders have agreed to waive their rights to any liquidation distributions. 2,443,750 Founder Shares were purchased by the Initial Stockholders prior to the IPO for an aggregate purchase price of $25,000. The Sponsor became the beneficial owner of 2,343,750 of those shares. Subsequently, the Sponsor transferred some of its Class B Common Stock to FRLA’s directors and officers, and now holds 2,283,750 shares. Additionally, the Sponsor has agreed to forfeit some of its Founder Shares such that after Closing, it will hold 761,250 Founder Shares. The Sponsor’s remaining 761,250 Founder Shares had an aggregate market value of approximately $[     ] based on the closing price of Public Shares on the Nasdaq Stock Market as of [     ], 2024. 

·If an initial business combination, such as the Business Combination, is not completed by November 5, 2024, the 60,000 FRLA Class B Common shares granted by the Sponsor (“Director Shares”) to Messrs. Pollack (30,000 shares), Goodman (20,000 shares) and Spick (10,000 shares) will be worthless. The Director Shares had an aggregate market value of approximately $[     ] based on the closing price of Public Shares on the Nasdaq Stock Market as of [     ], 2024. 

·Beau Vuillemot, a director of FRLA, is anticipated to continue as a director of the Combined Company. 

·The exercise of FRLA’s directors’ and officers’ discretion in agreeing to changes or waivers in the terms of the transaction may result in a conflict of interest when determining whether such changes or waivers are appropriate and in our stockholders’ best interest. 

FRLA’s board of directors were aware of and considered these interests, among other matters, in evaluating and negotiating the Business Combination and the Business Combination Agreement.

Background of the Business Combination

The terms of the proposed Business Combination are the result of an extensive search by FRLA for a potential transaction and negotiations between representatives of FRLA and WODI (and its affiliates). The following is a brief description of the background of these negotiations and the resulting proposed Business Combination.

FRLA is a blank check company formed as a Delaware corporation for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization, or similar business combination with one or more businesses.

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On November 5, 2021, FRLA consummated its IPO of 9,775,000 units (including 1,275,000 units issued upon the full exercise of the over-allotment option, the “Public Units”). Each Unit consists of one share of FRLA Class A Common Stock, and one-half of one redeemable warrant, each whole warrant entitling the holder thereof to purchase one share of FRLA Class A Common Stock at an exercise price of $11.50 per share. The Public Units were sold at an offering price of $10.00 per Unit, generating gross proceeds of $97,750,000. Simultaneously with the closing of the IPO, FRLA completed the private sale (the “Private Placement”) of 545,500 Private Placement Shares, including 505,500 shares to the Sponsor and 40,000 shares to U.S. Tiger Securities (“U.S. Tiger”) and EF Hutton, a division of Benchmark Investment LLC, two representatives of the several underwriters, at a purchase price of $10.00 per Private Placement Share, generating gross proceeds to FRLA of $5,455,000. The proceeds of $99,705,000 ($10.20 per Unit) in the aggregate from the IPO and the Private Placement, were placed in the Trust Account, and the remaining proceeds became available to be used to provide for business, legal and accounting due diligence on prospective business combinations and continuing general and administrative expenses.

The Company issued 120,000 Representative Shares in Class A Common Stock to the Representatives of the underwriters for the Company’s IPO, as part of their underwriting compensation. The Representative Shares are identical to the public shares except that the Representatives have agreed not to transfer, assign or sell any such Representative Shares until the completion of the Company’s initial Business Combination. In addition, the Representatives have agreed (i) to waive their redemption rights with respect to such shares in connection with the completion of the Company’s initial Business Combination and (ii) to waive their rights to liquidating distributions from the Trust Account (as defined below) with respect to such shares if the Company fails to complete its initial Business Combination by November 5, 2024.

Prior to the closing of its IPO, neither FRLA, nor anyone on its behalf, had contacted any prospective target business or had any substantive discussions, formal or otherwise, with respect to a transaction with FRLA.

The following chronology summarizes the key meetings and events that led to the signing of the BCA. The following chronology does not purport to catalogue every conversation among representatives of FRLA, WODI and other parties.

After its IPO, FRLA’s former officers and directors (“Former Management”) commenced an active search for prospective businesses and assets to acquire. Former Management committed to utilize the diligence, rigor, and expertise of their respective platforms to evaluate potential targets’ strengths, weaknesses, and opportunities to identify the relative risk and return profile of any potential target for an initial business combination.

Their strategy was to identify, acquire, and initiate business combination with the mindset and goal to build and grow companies from various industries. They sought potential targets which they believed could materially grow revenue and earnings through the efforts of a combined management team following completion of an initial business combination. They committed to not undertake an initial business combination with any entity with its principal business operations in China (including Hong Kong and Macau).

At the time of the IPO and in the initial months afterward, Former Management did not have any specific business combination under consideration. They reported that they were continuously made aware of potential business opportunities: proprietary transaction opportunities that originated as a result of their business relationships, direct outreach, and deal sourcing activities; and target business candidates brought to their attention from various unaffiliated sources, including investment banking firms, consultants, accounting firms, private equity groups, large business enterprises, and other market participants.

FRLA was not prohibited from pursuing an initial business combination with a business combination target that is affiliated with its founders, officers, directors, or advisors or making the acquisition through a joint venture or other form of shared ownership with its officers, directors or advisors. However, in the event that FRLA should seek to complete an initial business combination with a business combination target that is affiliated with FRLA’s founders, officers, directors, or advisors, FRLA would obtain an opinion from an independent investment banking firm which

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is a member of FINRA or an independent accounting firm that such an initial business combination is fair to our company from a financial point of view.

Former Management found a target that they felt to be suitable, and on May 22, 2022, FRLA announced that it had entered into a definitive merger agreement pursuant to acquire the business of VCV Power Sigma, Inc. (“Sigma”) and VCV Power Gamma, Inc. (“Gamma” and, together with Sigma, “VCV Digital Technology”). VCV Digital Technology developed digital asset mining solutions and services that aimed to rely on renewable energy for Blockchain/Web3 computing infrastructure deployment. However, for reasons unknown to the current FRLA management, on July 19, 2022, the parties mutually agreed to terminate the merger agreement and the transaction contemplated thereby was abandoned.

Originally, FRLA had until November 5, 2022 to consummate a business combination, with the right to extend the time period under certain circumstances. On November 4, 2022, an aggregate of $977,500 (the “First Extension Payment”) was deposited into the Trust Account for the public shareholders, representing $0.10 per public share, which enables FRLA to extend the period of time it has to consummate its initial Business Combination by three months from November 5, 2022 to February 5, 2023. In connection with the First Extension Payment, FRLA issued unsecured promissory notes to certain initial stockholders including (i) a note of $413,750 to Mr. Koon Keung Chan, then manager of the Sponsor, (ii) a note of $150,000 to U.S. Tiger, and (iii) a note of $170,000 to Dr. Lei Xu, then President and Chairwoman of FRLA. The three promissory notes together with FRLA’s working capital were used to pay for the First Extension Payment.

Effective December 22, 2022, the Sponsor entered into a Securities Transfer Agreement with each of U.S. Tiger (as designee of Lei Huang), Lei Xu, Yuanmei Ma, Norman C. Kristoff, David Xianglin Li, Michael Davidov, and Christy Szeto (the “Class B Sellers”) pursuant to which the Class B Sellers sold to the Sponsor an aggregate of 343,750 shares of FRLA Class B Common Stock for the purchase price of $3,506.25. Effective December 22, 2022, the Sponsor, the owners of the Sponsor (Ka Wai Cheung, Koon Lin Chan, and Koon Keung Chan) (collectively, the “Sellers”) and WODI NV entered into a Membership Interest Purchase and Transfer Agreement pursuant to which they sold to WODI NV all right, title and interest in and to the membership interests held by each of Messrs. Cheung, Chan, and Chan in the Sponsor (100 membership interests) for $400,000. As a result, beneficial ownership of the 2,343,750 shares out of 2,443,750 issued and outstanding shares of FRLA Class B Common Stock of FRLA held by the Sellers was transferred to WODI NV. Out of the issued and outstanding shares of FRLA Class B Common Stock, an aggregate of 100,000 shares remain owned by Former Management.

Also, on December 22, 2022, each of Koon Keung Chan, Lei Xu, and U.S. Tiger assigned each of their promissory notes issued on November 4, 2022 in the aggregate amount of $733,750 to the Sponsor.

Lastly, effective December 22, 2022, each member of the Board of Directors and each officer of FRLA (Former Management) resigned from their respective positions, and new board members and a principal executive officer (“New Management”) were appointed.

On January 5, 2023, FRLA signed a non-binding Letter of Intent (the “WODI NV LOI”) with WODI NV, under which FRLA proposed to acquire all the outstanding securities of WODI NV based on certain material financial and business terms and conditions being met. The business combination was subject to due diligence of WODI NV as well as negotiating a definitive agreement; and there was no assurance that any definitive agreement would be reached between WODI NV and FRLA.

Besides the WODI NV LOI disclosed above, New Management did not at that time select any other potential business combination target or initiate any substantive discussions, directly or indirectly, with any other potential business combination prospects.

On February 6, 2023, $977,500 (the “Second Extension Payment”) was deposited into the Trust Account to extend the period of time FRLA had to consummate our initial business combination by three months from February

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5, 2023 to May 5, 2023. In connection with the Second Extension Payment, FRLA issued an unsecured promissory note to WODI NV.

After prior approval of our board of directors, on April 10, 2023, at a special meeting of stockholders, FRLA’s stockholders approved the filing of an amendment to the Amended and Restated Certificate of Incorporation (the “Amendment”) to extend the period of time for FRLA to consummate a business combination, up to six times, each by an additional month, for an aggregate of six additional months (i.e., from May 5, 2023 to up to November 5, 2023). On April 11, 2023, FRLA filed the Amendment with the Delaware Secretary of State. The stockholder vote to approve the Amendment also triggered a redemption right for the holders of the public shares of FRLA Class A Common Stock. As a result of the Amendment, 4,493,968 shares of FRLA Class A Common Stock elected to be redeemed.

From February 2023 through September 2023, FRLA’s management conducted due diligence and held detailed conversations with WODI NV’s management team to evaluate its suitability as an acquisition target. A preliminary draft definitive agreement was circulated in May 2023, and WODI NV provided FRLA access to a data room in June 2023. In those discussions and based on a review of projections that had been provided, a tentative transaction value in the range of $25 to $35 million was contemplated.

In mid-July 2023, Nelson Mullins Riley & Scarborough LLP (“Nelson Mullins”) was engaged by FRLA.

Starting on July 28, 2023, FRLA, OriginClear, Nelson Mullins and KBA held a weekly video conference to track the overall progress of the proposed business combination, review open due diligence requests, track progress of the audit and resolve open items related to the proposed business combination.

Effective April 14, 2023, WODI NV purchased certain assets of affiliated entity Modular Water Systems, Inc., a Nevada corporation (“MWS”), including trademarks, licenses, contracts, business models, accounts receivables, patents and other tangible and intangible assets used in connection with its “Modular Water Service” business (“MWS Assets”). In exchange for the MWS Assets, WODI issued to MWS 6,000,000 shares of its Class A Voting Stock.

In looking at recent operating results and growth projections for WODI NV’s pay-as you-go finance platform and the MWS Modular Water System, FRLA management requested more data regarding the combined enterprises’ competitive position, especially given MWS’ relatively short operating history along with the fact that WODI NV’s largest projected source of future growth (its plan to offer customers its pay-as-you go “water on demand”) was still pre-revenue. FRLA asked an intellectual property expert with a long-term relationship to its board chairman to do an informal review WODI NV’s patents and the IP valuation report that WODI NV had provided. Feedback from the patent review was consistent with the data in the IP valuation report. Still, the FRLA Board wanted more comfort, and so WODI NV agreed to formally retain a third-party consultant to analyze the MWS business. The consultant’s report was delivered to FRLA in August 2023, and was updated in September 2023 in response to various questions from the FRLA Board. The report supported FRLA’s favorable view of MWS.

However, as FRLA and WODI NV continued to work towards agreement on final terms, the parties concluded that MWS, which had previously been combined with its affiliate, Progressive Water Systems, Inc. (“PWT”) and then spun out from PWT as part of WODI NV, would be better off if it were still combined with PWT; combining these entities would add more revenue to the post-merger company, and there would be operating synergies, with PWT providing leads to MWS (customers who did not need PWT’s customized solutions), and MWS providing leads to PWT (customers for whom MWS’ standardized solutions might not be appropriate). FRLA’s management had initially raised the possibility in June 2023 of having PWT included as part of the de-SPAC transaction, but OriginClear Inc. (“OriginClear”) (the parent company of both WODI NV and PWT) was not receptive to the idea at that time. By August 2023, OriginClear had changed its position, and agreed to explore the inclusion of PWT. Meanwhile, FRLA was introduced to the management of PWT to being its due diligence.

The parties continued to work together in good faith with their respective advisors to agree on a structure for the business combination. The prior WODI NV data room (which excluded PWT) was updated to include new

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information regarding PWT (along with WODI NV). On August 14, 2023, KBA, on behalf of WODI, delivered via email to Nelson Mullins, on behalf of FRLA, an initial revised draft of the BCA contemplating the acquisition of WODI (the former PWT, which OriginClear had recently merged with WODI NV).

Accordingly, the prior WODI NV LOI was amended to designate WODI as the new target of the acquisition. Under the revised/amended LOI, FRLA proposed to acquire all the outstanding securities of WODI, based on certain material financial and business terms and conditions being met. The LOI was not binding on the parties and was intended solely to guide good-faith negotiations toward definitive agreements. On September 28, 2023, FRLA and OriginClear announced that FRLA and WODI NV had agreed to nominate a new target for acquisition by FRLA.

In addition to conducting its own due diligence, FRLA retained The Benchmark Company, LLC (“Benchmark”) on June 5, 2023 to act as financial advisor to the FRLA Board in connection with the contemplated WODI NV, and later, WODI transaction (the “Transaction”), regarding transaction terms and structure. As part of that engagement, the FRLA Board requested that Benchmark provide a written opinion in connection with the Transaction (the “Benchmark Opinion”) as to whether the consideration to be paid in the Transaction is fair to FRLA’s unaffiliated public stockholders from a financial point of view.

On August 22, 2023, Nelson Mullins, on behalf of FRLA, delivered via email to KBA, on behalf of WODI, a revised draft of the BCA.

On August 30, 2023, KBA, on behalf of WODI, delivered via email to Nelson Mullins, on behalf of FRLA, a revised draft of the BCA and an initial draft of the Sponsor Letter Agreement.

On September 21, 2023, Nelson Mullins, on behalf of FRLA, delivered via email to KBA, on behalf of WODI, a revised draft of the BCA, including an agreed transaction value of $32 million for WODI (including WODI NV).

From September 21, 2023 to October 24, 2023, the parties also negotiated certain terms and conditions of the BCA and the ancillary agreements, including lock-up restrictions on the WODI shareholders, registration rights and forfeiture of FRLA shares by the Sponsor.

Between September 21, 2023 and October 24, 2023, multiple revised drafts of the BCA were exchanged between the parties. In the process, the Sponsor agreed to retire 1,522,500 of its Founder Shares.

On October 23, 2023, the FRLA Board met via video conference to discuss the Business Combination and BCA in detail, and the proposed BCA and all of the transactions and ancillary documents contemplated by it, subject to completion of definitive documents. Also in attendance were representatives of Benchmark and Nelson Mullins. At the meeting, Benchmark reviewed its financial analysis with the FRLA Board and rendered an oral opinion subsequently confirmed in writing on October 24, 2023 by delivery of the Benchmark Opinion addressed to the FRLA Board. The summary of the Benchmark Opinion in this proxy statement is qualified in its entirety by reference to the full text of the Benchmark Opinion, which is attached to this proxy statement/prospectus/consent solicitation statement as Annex G, and sets forth the assumptions made, procedures followed, matters considered, qualifications and limitations on the review undertaken by Benchmark in connection with the Benchmark Opinion. For a detailed discussion of the Benchmark Opinion, see the section below entitled “Description of Fairness Opinion of Benchmark.”

At the October 23, 2023 meeting, after considering the proposed terms of the Business Combination and ancillary documents and asking questions to FRLA’s management, Benchmark and Nelson Mullins, and taking into account the other factors described below under the caption “The FRLA Special Meeting — FRLA Proposal 1 – The FRLA Business Combination Proposal — The FRLA Board’s Reasons for the Approval of the Business Combination,” the FRLA Board unanimously approved the BCA and ancillary documents and determined that each of the BCA and the ancillary documents (and the transactions contemplated by such agreements) was advisable and in the best interests of FRLA and its stockholders. The FRLA Board further determined that it was advisable and in the best interests of FRLA and its stockholders to consummate the Business Combination and other transactions contemplated by the BCA

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and related agreements, and the FRLA Board directed that the BCA and the other stockholder proposals described in this proxy statement/prospectus/consent solicitation statement be submitted to FRLA’s stockholders for approval and adoption, and recommended that FRLA’s stockholders approve and adopt the BCA and such other proposals.

On October 24, 2023, FRLA, WODI and Merger Sub executed the BCA. Concurrent with the execution of the BCA, the applicable parties executed the Sponsor Letter Agreement. FRLA and WODI issued a joint press release announcing the execution of the BCA, which was filed as an exhibit to a Current Report on Form 8-K.

On October 25, 2023, FRLA’s stockholders approved, among other things, an amendment to FRLA’s certificate of incorporation to extend the date by which FRLA has to consummate a business combination for an additional twelve months, from November 5, 2023 to up to November 5, 2024, on a monthly basis for up to twelve times by an additional one month each time.

On February 6, 2024, FRLA and WODI entered into Amendment No. 1 to the BCA, which eliminated the closing condition that FRLA have tangible net assets of at least $5,000,001, and amended certain WODI disclosure schedules.

The parties have continued and expect to continue regular discussions regarding the execution and timing of the Business Combination and to take actions and exercise their respective rights under the BCA to facilitate the completion of the Business Combination.

The WODI Board’s Reasons for the Approval of the Business Combination

The WODI Board’s reasons for the Business Combination include that the Business Combination provides WODI with a means to become a public company, which will provide WODI with access to capital to partially fund the growth of its business.

The FRLA Board’s Reasons for the Approval of the Business Combination

On October 24, 2023, the BCA was executed by the parties. In reaching its decision, the FRLA Board reviewed the results of its due diligence investigation and the results of the due diligence investigations of its third-party financial and legal advisors. The FRLA Board also received and reviewed presentations from, and discussed with, FRLA’s third-party financial and legal advisors regarding the transaction structure, material terms of the Business Combination and various aspects of WODI and the due diligence.

The due diligence conducted by FRLA’s management and information received by FRLA included, among other data:

·research on comparable companies and transactions; 

·general industry research and analysis, and a general overview of the public markets; 

·review and discussions of the transaction structure with and FRLA’s legal and financial advisors; 

·various presentations regarding WODI’s business and strategic direction and recent initiatives; 

·financial and accounting due diligence review; 

·legal diligence review conducted by FRLA’s legal advisors; 

·the Benchmark Opinion; 

·a financial, operational and documentation review by management of requested materials provided by WODI; and 

·extensive meetings and calls with WODI’s management and WODI’s representatives regarding WODI’s operations, financial condition, strategy and prospects. 

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The FRLA Board considered a wide variety of factors in connection with its evaluation of the Business Combination. In light of the complexity of those factors, the FRLA Board, as a whole, did not consider it practicable to, nor did it attempt to, quantify or otherwise assign relative weights to the specific factors it took into account in reaching its decision. Individual directors may have given different weight to different factors. This explanation of FRLA’s reasons for the Business Combination and all other information presented in this section is forward-looking. Therefore, you should read this explanation in light of the factors discussed under “Cautionary Note Regarding Forward-Looking Statements.”

In the prospectus for the IPO, FRLA identified the following general criteria and guidelines that FRLA believed would be important in evaluating prospective target businesses, although they could deviate from these criteria and guidelines should they see justification to do so:

·Strong Management Team. Businesses with reasoned and strong managements having a track record of driving growth and profitability; or having proposition of the businesses that may likely be well received by public investors. 

·Growth Potential. Businesses that present the potential for revenue and earnings growth through a combination of business, management and resources; and with potential to generate stable and increasing free cash flow. 

·Benefit from Being a Public Company. Businesses which can effectively utilize access to broader sources of capital and a public profile that are associated with being a publicly traded company. 

This list of criteria and guidelines was not intended to be exhaustive, and Former Management stated that it would evaluate and value potential target companies on a case-by-case basis. Any evaluation relating to the merits of a particular initial business combination or acquisition would be based, to the extent relevant, on these general guidelines as well as other considerations, factors, and criteria that they may deem relevant.

In considering the Business Combination, the FRLA Board concluded that WODI substantially met the above criteria.

In making the recommendation, the FRLA Board also considered, among other things, the following potential deterrents to the Business Combination:

·the risk that the announcement of the Business Combination and potential diversion of WODI’s management and employee attention may adversely affect WODI’s operations; 

·the risk that certain key employees of WODI might not choose to remain with the Company post-Closing; 

·the risk that the FRLA Board may not have properly valued WODI’s business; 

·the risk of competition in the industry, including the potential for new entrants; 

·the substantial expense and human resources necessary to operate a public company; 

·the risk that the Business Combination might not be consummated in a timely manner or that the closing of the Business Combination might not occur despite the companies’ efforts, including by reason of a failure to obtain the approval of FRLA’s stockholders; 

·the risk of failure to satisfy the conditions to Closing (to the extent not waived by the parties); 

·the inability to maintain the listing of WODI’s securities on Nasdaq following the Business Combination; 

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·the significant fees and expenses associated with completing the Business Combination and the substantial time and effort of management required to complete the Business Combination; 

·the potential conflicts of interest of the Sponsor and FRLA’s officers and directors in the Business Combination; and 

·the other risks described in the “Risk Factors” section of this proxy statement/prospectus/consent solicitation statement. 

The FRLA Board concluded that these risks could be managed or mitigated by WODI or were unlikely to have a material impact on the Business Combination or WODI, and that, overall, the potentially negative factors or risks associated with the Business Combination were outweighed by the potential benefits of the Business Combination to FRLA and its stockholders. The FRLA Board realized that there can be no assurance about future results, including results considered or expected as disclosed in the foregoing reasons. Accordingly, after considering the potentially negative and potentially positive reasons, the FRLA Board unanimously determined that the BCA, and the transactions contemplated thereby, including the Business Combination, were advisable, fair to, and in the best interests of, FRLA and its stockholders.

Description of Fairness Opinion of Benchmark

Benchmark provides investment banking and advisory services to institutions and companies, and its investment banking practice provides valuation services in connection with financings and mergers and acquisitions for both public and private companies. Pursuant to a letter agreement dated June 5, 2023, FRLA retained Benchmark to act as financial advisor to the FRLA Board in connection with the Business Combination to provide the Benchmark Opinion to the FRLA Board as to whether the consideration to be paid by FRLA in the Business Combination is fair to FRLA’s unaffiliated public stockholders from a financial point of view. FRLA selected Benchmark based on various considerations that included Benchmark’s experience with similar transactions, reputation, knowledge of the relevant industry and fee proposal, and relevant qualifications of Benchmark’s team members.

On October 23, 2023, Benchmark reviewed its financial analysis with the FRLA Board and rendered an oral opinion to the FRLA Board, subsequently confirmed in writing on October 24, 2023, by delivery of the Benchmark Opinion addressed to the FRLA Board, that the consideration to be paid by FRLA in the Business Combination pursuant to the Business Combination Agreement, as of that date and based on and subject to the matters considered, the procedures followed, the assumptions made and various limitations of and qualifications to the review undertaken, was fair to FRLA’s unaffiliated public stockholders from a financial point of view.

The Benchmark Opinion is addressed to, and is intended for the use, information and benefit of the FRLA Board (solely in its capacity as such) and only addressed the fairness, from a financial point of view, of the consideration to be paid by FRLA in the Business Combination to FRLA’s unaffiliated public stockholders as of the date of such opinion. Benchmark was not requested to, and the Benchmark Opinion does not express an opinion as to or otherwise address, among other things: (i) the underlying business decision of the FRLA Board, FRLA, its security holders or any other party to proceed with or effect the Business Combination, (ii) the terms of any arrangements, understandings, agreements or documents related to, or the form, structure or any other portion or aspect of, the Business Combination or otherwise (other than the consideration to the extent expressly specified herein), (iii) the fairness of any portion or aspect of the Business Combination to the holders of any class of securities, creditors or other constituencies of FRLA, or to any other party, except if and only to the extent expressly set forth in Benchmark Opinion, (iv) the relative merits of the Business Combination as compared to any alternative business strategies or transactions that might be available for FRLA, WODI or any other party, (v) the fairness of any portion or aspect of the Business Combination to any one class or group of FRLA’s or any other party’s security holders or other constituents vis-à-vis any other class or group of WODI’s or such other party’s security holders or other constituents (including, without limitation, the allocation of any consideration amongst or within such classes or groups of security holders or other constituents), except if and only to the extent expressly set forth in the Benchmark Opinion, (vi) the solvency, creditworthiness or fair value of WODI, FRLA or any other participant in the Business Combination, or any

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of their respective assets, under any applicable laws relating to bankruptcy, insolvency, fraudulent conveyance or similar matters, or (vii) the fairness, financial or otherwise, of the amount, nature or any other aspect of any compensation to or consideration payable to or received by any officers, directors or employees of any party to the Business Combination, any class of such persons or any other party, relative to the consideration or otherwise. Furthermore, no opinion, counsel or interpretation is intended in the Benchmark Opinion in matters that require legal, regulatory, accounting, insurance, tax or other similar professional advice. The Benchmark Opinion assumed that such opinions, counsel or interpretations have been or will be obtained from the appropriate professional sources. Benchmark relied, with the consent of the FRLA Board, on the assessments by the FRLA Board, FRLA and its advisors, as to all legal, regulatory, accounting, insurance and tax matters with respect to WODI, FRLA, the Business Combination or otherwise. The Benchmark Opinion addresses only the fairness, from a financial point of view, to FRLA’s unaffiliated public stockholders as of October 24, 2023, of the consideration to be paid in the Business Combination pursuant to the Business Combination Agreement.

The Benchmark Opinion was necessarily based upon financial, economic, market, and other conditions as they existed on, and should be evaluated as of, and the information made available to Benchmark as of, the date of the Benchmark Opinion. Although subsequent circumstances, developments or events might affect the Benchmark Opinion, Benchmark does not have any obligation to update, revise or reaffirm the Benchmark Opinion. The issuance of the Benchmark Opinion was approved by its internal fairness opinion review committee. The Benchmark Opinion does not speak to any date other than the date of such opinion, and as such, the Benchmark Opinion will not address the fairness of the consideration, from a financial point of view, at any date after the date of such opinion, including at the time the Business Combination is completed.

The full text of the written opinion of Benchmark, dated October 24, 2023, which sets forth matters considered, the procedures followed, the assumptions made and various limitations of and qualifications to the review undertaken in connection with the Benchmark Opinion, is attached as Annex G to this proxy statement/prospectus/consent solicitation statement. The following summary of the Benchmark Opinion in this proxy statement/prospectus/consent solicitation statement is qualified in its entirety by reference to the full text of the opinion. Benchmark provided its opinion for the information and assistance of the FRLA Board in connection with its consideration of the Business Combination. The Benchmark Opinion was not intended to be, and does not constitute, a recommendation to the FRLA Board, any security holder or any other party as to how to act or vote with respect to any matter relating to the Business Combination or otherwise.

In arriving at the Benchmark Opinion, Benchmark reviewed and considered such financial and other matters as Benchmark deemed relevant, including, among other things:

	▪	a draft of the Business Combination Agreement provided to Benchmark by FRLA, dated October 23, 2023;
	▪	certain information relating to the historical, current and future operations, financial condition and prospects of WODI, made available to Benchmark by FRLA, including unaudited financial statements for the calendar years 2021 and 2022, and a financial model with projected financials for the calendar years 2023-2026;
	▪	discussions with certain members of the management of FRLA and WODI and certain of its advisors and representatives regarding the business, operations, financial condition and prospects of WODI, the Business Combination and related matters;
	▪	a certificate addressed to Benchmark from senior management of FRLA which contains, among other things, representations regarding the accuracy of the information, data and other materials (financial or otherwise) on WODI provided to, or discussed with, Benchmark by or on behalf of FRLA;
	▪	the current and historical market prices, trading characteristics and financial performance of the publicly traded securities of certain companies that Benchmark deemed to be relevant;
	▪	the publicly available financial terms of certain transactions that Benchmark deemed to be relevant; and
	▪	such other information, economic and market criteria and data, financial studies, analyses and investigations and such other factors as Benchmark deemed relevant.

In arriving at its opinion, Benchmark relied upon and assumed, without independent verification, the accuracy and completeness of all data, material and other information furnished, or otherwise made available, to Benchmark,

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discussed with or reviewed by Benchmark, or publicly available, and did not assume any responsibility with respect to such data, material and other information. Benchmark relied upon and assumed, without independent verification, that there had been no change in the business, assets, liabilities, financial condition, results of operations, cash flows or prospects of WODI since the respective dates of the most recent financial statements and other information, financial or otherwise, provided to Benchmark that would be material to its analyses or opinion, and that there was no information or fact that would make any of the information reviewed by Benchmark incomplete or misleading. Benchmark further relied upon the assurance of the management of FRLA and WODI that they were unaware of any facts that would make the information provided to Benchmark incomplete or misleading in any material respect. In connection with its review and arriving at its opinion, Benchmark did not assume any responsibility for the independent verification of any of the foregoing information and relied on the completeness and accuracy as represented by FRLA and WODI. In addition, Benchmark relied upon and assumed, without independent verification, that the final form of the Business Combination Agreement would not differ in any material respect from the version of the Business Combination Agreement provided to Benchmark as identified above. In addition, Benchmark did not make any independent evaluation or appraisal of the assets or liabilities of FRLA or WODI nor was Benchmark furnished with any such independent evaluations or appraisals.

Benchmark was not requested to, and did not (a) initiate or participate in any discussions or negotiations with, or solicit any indications of interest from, third parties with respect to the Business Combination, the securities, assets, businesses or operations of FRLA or WODI or any other party, or any alternatives to the Business Combination, (b) negotiate the terms of the Business Combination or (c) advise the FRLA Board or any other party with respect to alternatives to the Business Combination.

Financial Analyses

The following is a summary of the material financial analyses performed by Benchmark in connection with the preparation of the Benchmark Opinion. The following summary, however, does not purport to be a complete description of the financial analyses performed by Benchmark, nor does the order of analyses described represent the relative importance or weight given to those analyses.

The financial analyses summarized below include information presented in tabular format. In order to fully understand the financial analyses performed by Benchmark, the tables must be read together with the text of each summary. The tables alone do not constitute a complete description of the financial analyses performed by Benchmark. Considering the data set forth in the tables below without considering the full narrative description of the financial analyses, including the methodologies and assumptions underlying the analyses, could create a misleading or incomplete view of the financial analyses performed by Benchmark. The order in which these analyses are presented below, and the results of those analyses, should not be taken as an indication of the relative importance or weight given to these analyses by Benchmark or the FRLA Board. Except as otherwise noted, the following quantitative information, to the extent it is based on market data, is based on market data as it existed on or before October 23, 2023, and is not necessarily indicative of current market conditions. All analyses conducted by Benchmark were going-concern analyses and Benchmark expressed no opinion regarding the liquidation value of any entity.

Benchmark completed a series of financial analyses to derive a range of approximate implied equity values for WODI and calculated an approximate implied per share equity value range for the shares of FRLA Common Stock to be held by FRLA’s non-redeeming unaffiliated public stockholders after giving effect to the Business Combination based on, among other things, the estimated implied pro forma percentage equity stake of such stockholders in FRLA upon consummation of the Business Combination. Benchmark’s financial analysis employed three customary approaches in conducting its analyses and arriving at the Benchmark Opinion, with no particular weight given to any:

●

selected public company analysis;

 

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precedent transaction analysis; and

 

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discounted cash flow analysis.

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Selected Public Company Analysis

Benchmark performed a selected public company analysis by analyzing the valuation of publicly-listed companies that Benchmark deemed to be relevant for purposes of this analysis based on its professional judgment and experience. Benchmark reviewed publicly-available financial and stock market information for companies primarily focused on water technology and infrastructure products and services that are publicly-listed on a US exchange. The selected public companies consisted of 11 companies that, as of 10/23/23, met the following criteria: 1) business or product descriptions that include the terms "water management", "water infrastructure", "water solutions", "water technologies", "water systems", "water purification" or "water treatment", 2) business descriptions indicating a primary focus on water technology or water infrastructure products or services, and 3) publicly-listed on a US stock exchange, and where revenue forecasts for 2024 were available. Benchmark used primarily a database provided by FactSet to screen for companies that met the above criteria based on their business descriptions, business and financial information and exchange-listing status, and further reviewed the selected public companies’ corporate websites and other publicly-available information. Benchmark reviewed, among other things, enterprise values (EV) of the selected companies, calculated as equity values based on closing stock prices on October 23, 2023, plus debt, plus preferred stock, plus minority interest, and less cash and cash equivalents, as a multiple of revenue forecasts based on consensus analysts’ estimates for the years 2024 and 2025. Benchmark’s analysis identified the following 11 companies that Benchmark deemed comparable to WODI but none of which is identical to WODI:

Company Name	Enterprise Value ($ million)	Market Value ($ million)	EV/ Rev (LTM)	EV/ EBITDA (LTM)	EV/ Rev (2024)	EV/ Rev (2025)
A. O. Smith Corporation	$9,822	$11,904	2.6x	12.6x	2.5x	2.4x
Advanced Drainage Systems, Inc.	$9,651	$8,877	3.3x	11.3x	3.2x	2.9x
American Water Works Company, Inc.	$33,849	$23,092	8.4x	16.1x	7.7x	7.2x
Aris Water Solutions, Inc.	$1,033	$478	2.9x	7.2x	2.4x	2.2x
Consolidated Water Co. Ltd.	$413	$454	3.2x	16.7x	3.2x	NA
Mueller Water Products, Inc.	$2,243	$1,911	1.7x	12.0x	1.8x	1.7x
Pentair plc	$12,361	$10,288	3.0x	14.7x	2.9x	2.8x
Select Water Solutions, Inc.	$1,004	$895	0.6x	4.5x	0.6x	0.5x
Watts Water Technologies, Inc.	$5,481	$5,674	2.7x	14.4x	2.6x	2.5x
Xylem Inc.	$23,497	$22,953	3.9x	24.9x	2.8x	2.7x
Zurn Elkay Water Solutions Corporation	$4,911	$4,408	3.2x	22.2x	3.1x	3.0x
Average	$9,479	$8,267	3.2x	14.2x	3.0x	2.8x

 

Benchmark applied the overall average forward enterprise value to revenue multiples observed for the selected companies to WODI’s 2024 and 2025 revenue forecasts provided to Benchmark by FRLA. This analysis resulted in an approximate implied equity value range for WODI of $38.3 million to $61.2 million.

Precedent Transaction Analysis

Benchmark performed a precedent transaction analysis by analyzing recent mergers and acquisitions involving companies that it deemed to be relevant for purposes of this analysis based on its professional judgment and experience. Benchmark analyzed the valuation of merger and acquisition transactions announced and completed over the three-year period prior to the date of the Benchmark Opinion involving companies primarily focused on water technology and infrastructure products and services and with respect to which financial terms were publicly available. The precedent transactions consisted of three merger and acquisition (M&A) transactions announced and completed over the three years preceding 10/23/23 where the target company met the following criteria: 1) business or product

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descriptions that include the terms the terms "water management", "water infrastructure", "water solutions", "water technologies", "water systems", "water purification" or "water treatment", and 2) business descriptions indicating a primary focus on water technology or water infrastructure products or services, and where certain financial information about the transaction was publicly disclosed or otherwise available, specifically the transaction’s implied enterprise value and the target’s revenues. Benchmark used primarily a database provided by FactSet to screen for transactions that met the above criteria based on the transactions’ synopsis and the targets’ business descriptions and financial information, and further reviewed publicly available information on each transaction and target company prior to inclusion in the precedent transaction analysis. Benchmark reviewed, among other things, the selected precedent transactions’ implied enterprise value multiples of revenue forecasts for one and two forward years (for transactions with respect to which revenue forecasts were not publicly available, the transaction’s implied one-year and two-year forward multiples were estimated by discounting for one and two years, respectively, the transaction’s implied enterprise value multiple of the trailing twelve months’ revenues using WODI’s estimated discount rate (the same discount rate as used in the discounted cash flow analysis). Benchmark’s analysis identified the following three precedent transactions involving target companies that Benchmark deemed comparable to WODI but none of which is identical to WODI:

Target	Acquirer	Announcement Date	Enterprise Value ($ million)	EV/ Rev (FY1)	EV/ Rev (FY2)
Evoqua Water Technologies Corp.	Xylem, Inc.	1/23/2023	$7,314.7	3.4x	2.9x
New Aqua LLC	Franklin Electric Co., Inc.	5/17/2021	$150.0	1.9x	1.6x
PERC Water Corp.	Consolidated Water Co. Ltd.	1/9/2023	$21.0	1.3x	1.1x
Average			$2,495	2.2x	1.9x

 

Benchmark applied the overall average implied enterprise value to forward revenue multiples observed for the selected precedent transactions to WODI’s 2024 and 2025 revenue forecasts provided to Benchmark by FRLA. This analysis resulted in an approximate implied equity value range for WODI of $28.1 million to $40.9 million.

Discounted Cash Flow Analysis

Benchmark performed a discounted cash flow analysis of WODI to calculate the estimated present value of the standalone unlevered, after-tax free cash flows that WODI was forecasted to generate over the calendar years 2024 through 2026, using the WODI financial forecasts provided to Benchmark by FRLA. The analysis included the following key assumptions, among others:

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Consolidated revenues increasing from $13.0 million in 2024 to $32.5 million in 2026, as provided to Benchmark by FRLA;

 

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Net income increasing from $194k in 2024 to $2.9 million in 2026, as provided to Benchmark by FRLA; and

 

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Discount rates (WACC or Weighted-Average Cost of Capital) ranging from 16.2% to 20.2%, which was calculated as the risk-free rate, plus beta multiplied by the equity risk premium (ERP), plus an additional adjustment for small-company size. Benchmark used the 10-year treasury yield as the estimate for the risk-free rate (4.86% on 10/23/23), the average beta of the selected public companies (1.04), and ERP of 4.47% and small-company size adjustment of 8.67%, which are estimates based on market data. This resulted in an estimated discount rate of 18.2%, and we used a range of +2.0% and -2.0% around it to account for the sensitivity of valuation to discount rate.

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Benchmark calculated terminal values for WODI by applying terminal multiples of 3.2x to WODI’s 2026 revenue forecast and 14.2x WODI’s 2026 EBITDA (earnings before interest, taxes, depreciation and amortization) forecast, as provided to Benchmark by FRLA. The terminal multiples were selected using the selected public companies’ average enterprise value to last twelve months (LTM) revenues and EBITDA multiples. The discounted cash flow analysis resulted in an approximate implied equity value range for WODI of $35.7 million to $62.5 million.

Summary

Based on the range of approximate implied equity values derived for WODI in the financial analyses described above, and taking into account (i) the remaining estimated cash in trust of FRLA upon consummation of the Business Combination, (ii) the number of shares of FRLA Common Stock to be issued upon consummation of the Business Combination, (iii) the number of shares of FRLA Class A Common Stock not subject to redemption and FRLA Class B Common Stock (including non-sponsor shares and sponsor shares not forfeited), and (iv) transaction-related fees and expenses, the implied pro forma percentage equity stake of FRLA’s non-redeeming unaffiliated public stockholders upon consummation of the Business Combination assuming no redemptions is estimated to be approximately 44.5%, which implies an approximate implied per share equity value range for the shares of FRLA Common Stock to be held by FRLA’s non-redeeming unaffiliated public stockholders after giving effect to the Business Combination of between approximately $8.14 and $12.37 per share, and the implied pro forma percentage equity stake of FRLA’s non-redeeming unaffiliated public stockholders upon consummation of the Business Combination assuming 90% redemption is estimated to be approximately 7.4%, which implies an approximate implied per share equity value range for the shares of FRLA Common Stock to be held by FRLA’s non-redeeming unaffiliated public stockholders after giving effect to the Business Combination of between approximately $6.25 and $13.31 per share, in each as compared to an estimated redemption value of $10.96 per share.

Miscellaneous

The preparation of a financial opinion is a complex analytical process involving various determinations as to the most appropriate and relevant methods of financial analysis and the application of those methods to the particular circumstances and, therefore, a financial opinion is not readily susceptible to partial analysis or summary description. The fact that any specific analysis has been referred to in the summary above is not meant to indicate that such analysis was given greater weight than any other analysis referred to in the summary.

In performing its analyses, Benchmark considered industry performance, general business and economic conditions and other matters, many of which are beyond the control of FRLA and WODI. The estimates of the future performance of WODI in or underlying Benchmark’s analyses are not necessarily indicative of actual values or actual future results, which may be significantly more or less favorable than those estimates or those suggested by Benchmark’s analyses. These analyses were prepared solely as part of Benchmark’s analysis of the fairness, from a financial point of view, to FRLA’s unaffiliated public stockholders of the consideration to be paid by FRLA in the Business Combination and were provided to the FRLA Board in connection with the delivery of the Benchmark Opinion. The analyses do not purport to be appraisals or to reflect the prices at which a company might actually be sold or the prices at which any securities have traded or may trade at any time in the future. Accordingly, the estimates used in, and the ranges of valuations resulting from, any particular analysis described above are inherently subject to substantial uncertainty and should not be taken to be Benchmark’s view of the actual value of WODI.

FRLA paid Benchmark for its services in connection with the Benchmark Opinion a cash fee equal to $350,000, which was not contingent upon either the conclusion expressed in the Benchmark Opinion or on the consummation of the Business Combination. FRLA has also agreed to indemnify Benchmark against certain potential liabilities in connection with Benchmark’s services in rendering the Benchmark Opinion and to reimburse Benchmark for certain of its expenses, if any, incurred in connection with Benchmark’s engagement with FRLA. Over the last two years, Benchmark has not provided any services to FRLA unrelated to the Benchmark Opinion or WODI for which Benchmark received compensation. Benchmark may seek to provide other financial advisory or investment banking services to FRLA, WODI and/or their affiliates and other participants in the Business Combination in the

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future for which Benchmark may receive compensation, although as of the date of the Benchmark Opinion, there was no agreement to do so nor any mutual understanding that such services were contemplated.

Benchmark comprises a research, sales and trading, and investment banking firm engaged in securities, commodities and derivatives trading and other broker activities, as well as providing financing and financial advisory services and other commercial services to a wide range of companies and individuals. In the ordinary course of its business, Benchmark may have actively traded the securities of FRLA or WODI and may continue to actively trade such securities for their own accounts or for the accounts of customers and, accordingly, they may at any time hold long or short positions in such securities or other financial instruments. In addition, certain individuals who are employees of, or are affiliated with, Benchmark may have in the past and may currently be stockholders of FRLA or WODI.

The analysis was only one of the many factors considered by the FRLA Board in its evaluation of the Business Combination and should not be viewed as determinative of the views of the FRLA Board.

Certain WODI Projected Financial Information

The following is a summary of the financial information and projections provided by WODI to FRLA as well as a summary of FRLA management’s analysis and evaluation of the information and projections. The summary set forth below does not purport to be a complete description of the financial analysis performed or factors considered by us.

None of WODI or FRLA’s management, board of directors, affiliates, advisors or other representatives assumes responsibility to update the below information and future results may be materially different from those discussed. Any projections set forth below are not necessarily indicative or predictive of future results or values, which may be significantly more or less favorable. Accordingly, the assumptions and estimates used in, and the results derived from, the financial analyses are inherently subject to substantial uncertainty. Except as otherwise noted, market data used in our analysis is based on market data as of September 30, 2023 and is not necessarily indicative of current market conditions.

Certain of the measures included in the projections are non-GAAP financial measures, including EBITDA. Non-GAAP financial measures should not be considered in isolation from, or as a substitute for, financial information presented in compliance with GAAP, and non-GAAP financial measures as used by WODI are not reported by all of their competitors and may not be comparable to similarly titled amounts used by other companies.

Water on Demand Inc. - Forecast

 

	2024	2025	2026	2027
Revenues	$13,021,676	$22,214,379	$32,450,492	$46,565,494
Cost of Revenue	$8,931,918	$14,047,935	$20,008,220	$28,697,203
Gross Profit	$4,089,758	$8,166,445	$12,442,272	$17,868,291
Operating Expenses	$4,255,989	$6,637,707	$9,615,899	$11,539,481
Operating Profit (EBITDA)	$(166,231)	$1,528,738	$2,826,373	$6,328,810
Income Taxes	$(49,869)	$458,621	$847,912	$1,898,643
Net Income	$(116,362)	$1,070,117	$1,978,461	$4,430,167

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Satisfaction of 80% Test

It is a requirement under the Nasdaq Rules that the business or assets acquired in FRLA’s initial business combination have a fair market value equal to at least 80% of FRLA’s assets held in the Trust Account (excluding taxes payable on the income earned on the Trust Account) at the time of the execution of a definitive agreement for such initial business combination. As of October 24, 2023, the date of the execution of the Business Combination Agreement, the balance of the Trust Account was approximately $39.5 million and 80% thereof represents approximately $31.6 million. In reaching its conclusion that the Business Combination meets the 80% asset test, the Board reviewed the pre-money valuation of approximately $32.0 million. In determining whether the pro forma total enterprise value described above represents the fair market value of WODI, the Board considered all of the factors described in this section and the section of this proxy statement/prospectus/consent solicitation statement entitled “FRLA Proposal 1 – The FRLA Business Combination Proposal — The Business Combination Agreement” and that the pre-money valuation of approximately $32.0 million was determined as a result of arm’s length negotiations. As a result, the Board concluded that the fair market value of the equity acquired was significantly in excess of 80% of the assets held in the Trust Account (excluding taxes payable on the income earned on the Trust Account).

Interests of Certain Persons in the Business Combination

When you consider the recommendation of the Board in favor of adoption of the Business Combination Proposal and other Proposals, you should keep in mind that FRLA’s directors and officers have interests in the Business Combination that are different from, or in addition to, your interests as a shareholder, including:

·If an initial business combination, such as the Business Combination, is not completed by November 5, 2024, FRLA will be required to dissolve and liquidate. In such event, the Founder Shares will be worthless because holders have agreed to waive their rights to any liquidation distributions. 2,443,750 Founder Shares were acquired by the Initial Stockholders prior to the IPO for an aggregate purchase price of $25,000. The Sponsor became the beneficial owner of 2,343,750 of those shares. Subsequently, the Sponsor transferred some of its Class B Common Stock to FRLA’s directors and officers, and now holds 2,283,750 shares. Additionally, the Sponsor has agreed to forfeit some of its Founders Shares such that after Closing, it will hold 761,250 Founder Shares. The Sponsor’s remaining 761,250 Founder Shares had an aggregate market value of approximately $[     ] based on the closing price of Public Shares on the Nasdaq Stock Market as of [     ], 2024. 

·If an initial business combination, such as the Business Combination, is not completed by November 5, 2024, the 60,000 FRLA Class B Common shares granted by the Sponsor (“Director Shares”) to Messrs. Pollack (30,000 shares), Goodman (20,000 shares) and Spick (10,000 shares) will be worthless. The Director Shares had an aggregate market value of approximately $[     ] based on the closing price of Public Shares on the Nasdaq Stock Market as of [     ], 2024. 

·Beau Vuillemot, a director of FRLA, is anticipated to continue as a director of the Combined Company. 

·The exercise of FRLA’s directors’ and officers’ discretion in agreeing to changes or waivers in the terms of the transaction may result in a conflict of interest when determining whether such changes or waivers are appropriate and in our stockholders’ best interest. 

No Appraisal Rights

There are no appraisal rights available to FRLA stockholders in connection with the Business Combination.

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Total Shares of Common Stock Outstanding Upon Consummation of the Business Combination

It is anticipated that, upon the Closing of the Business Combination, FRLA’s public stockholders will retain an ownership interest of approximately 38.1% in the Combined Company, the Sponsor and directors of FRLA will retain an ownership interest of approximately 17.7% in the Combined Company, the Representatives will retain an ownership interest of approximately 1.4% in the Combined Company, and the WODI shareholders will own approximately42.8% of the outstanding common stock of the Combined Company. The ownership percentages with respect to the Combined Company assume (i) there are no redemptions of any shares by the FRLA’s public stockholders, and (ii) there are no issuances of any additional shares upon the Closing of the Business Combination under the Incentive Plan.

The following table illustrates varying ownership levels in the Combined Company, assuming no redemptions by FRLA public stockholders, 25% redemption by FRLA public stockholders, 50% redemption by FRLA public stockholders, 75% redemption by FRLA public stockholders and the maximum redemptions by FRLA public stockholders:

 

		Scenario 1 Assuming No Redemptions				Scenario 2 Assuming 25% Redemptions
Equity Capitalization Summary		Shares		%		Shares		%
WODI Shareholders		3,542,691		42.8%		3,542,691		47.2%
FRLA Public Stockholders		3,162,548		38.1%		2,371,911		31.6%
FRLA Initial Stockholders(a)		1,466,750		17.7%		1,466,750		19.6%
Representatives Shares		120,000		1.4%		120,000		1.6%
Total Common Stock		8,291,989		100.0%		7,501,352		100.0%

 

		Scenario 3 Assuming 50% Redemptions				Scenario 4 Assuming 75% Redemptions
Equity Capitalization Summary		Shares		%		Shares		%
WODI Shareholders		3,542,691		52.7%		3,542,691		59.8%
FRLA Public Stockholders		1,581,274		23.6%		790,637		13.4%
FRLA Initial Stockholders(a)		1,466,750		21.9%		1,466,750		24.8%
Representatives Shares		120,000		1.8%		120,000		2.0%
Total Common Stock		6,710,715		100.0%		5,920,078		100.0%

 

		Scenario 5 Assuming Maximum Redemptions
Equity Capitalization Summary		Shares		%
WODI Shareholders		3,542,691		69.1%
FRLA Public Stockholders		-		-%
FRLA Initial Stockholders(a)		1,466,750		28.6%
Representatives Shares		120,000		2.3%
Total Common Stock		5,129,441		100.0%

 

(a) After forfeiture of 1,522,500 shares.

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All of the relative percentages above are for illustrative purposes only and are based upon certain assumptions as described in the section entitled “Certain Defined Terms — Share Calculations and Ownership Percentages” and, with respect to the determination of the “maximum redemptions,” the section entitled “Unaudited Pro Forma Condensed Combined Financial Information.” Should one or more of the assumptions prove incorrect, actual ownership percentages may vary materially from those described in this proxy statement/prospectus/consent solicitation statement as anticipated, believed, estimated, expected or intended. See “Unaudited Pro Forma Condensed Combined Financial Information.”

Anticipated Accounting Treatment

The Business Combination will be accounted for as a “reverse recapitalization,” with no goodwill or other intangible assets recorded, in accordance with GAAP. A reverse recapitalization does not result in a new basis of accounting, and the financial statements of the combined entity represent the continuation of the financial statements of WODI in many respects.

Under this method of accounting, FRLA will be treated as the “acquired” company for financial reporting purposes. For accounting purposes, WODI will be deemed to be the accounting acquirer in the transaction and, consequently, the transaction will be treated as a recapitalization of WODI (i.e., a capital transaction involving the issuance of stock by FRLA for the stock of WODI). Accordingly, the consolidated assets, liabilities and results of operations of WODI will become the historical financial statements of the Combined Company, and FRLA’s assets, liabilities and results of operations will be consolidated with WODI’s beginning on the acquisition date. Operations prior to the Business Combination will be presented as those of WODI in future reports. The net assets of WODI will be recognized at carrying value, with no goodwill or other intangible assets recorded.

Redemption Rights

Pursuant to FRLA’s Certificate of Incorporation, holders of Public Shares may elect to have their shares redeemed for cash at the applicable redemption price per share equal to the quotient obtained by dividing (i) the aggregate amount on deposit in the Trust Account as of two business days prior to the consummation of the Business Combination, including interest (net of taxes payable), by (ii) the total number of then-outstanding Public Shares of common stock. As of [     ], 2024, this would have amounted to approximately $[     ] per share.

You will be entitled to receive cash for any Public Shares to be redeemed only if you: (i) hold Public Shares, or; and (ii) prior to [     ], Eastern Time, on [     ], 2024, (a) submit a written request to VStock that FRLA redeem your Public Shares for cash and (b) deliver your Public Shares to VStock, physically or electronically through DTC.

If a holder exercises their redemption rights, then such holder will be exchanging their Public Shares for cash and will no longer own shares of the Combined Company. Such a holder will be entitled to receive cash for its Public Shares only if it properly demands redemption and delivers its Public Shares (either physically or electronically) to VStock in accordance with the procedures described herein. Please see the section titled “The FRLA Special Meeting — Redemption Rights” for the procedures to be followed if you wish to redeem your Public Shares for cash.

Vote Required for Approval

Along with the approval of the FRLA Charter Amendment Proposal, the FRLA Incentive Plan Proposal, the FRLA Director Election Proposal, and the FRLA Nasdaq Proposal, approval of this FRLA Business Combination Proposal is a condition to the consummation of the Business Combination. If this Business Combination Proposal is not approved, the Business Combination will not take place. Approval of this FRLA Business Combination Proposal is also a condition to the FRLA Charter Amendment Proposal, the FRLA Incentive Plan Proposal, the FRLA Director Election Proposal, and the FRLA Nasdaq Proposal. If the FRLA Charter Amendment Proposal, the FRLA Incentive Plan Proposal, the FRLA Director Election Proposal, and the FRLA Nasdaq Proposal are not approved, unless the condition is waived, this FRLA Business Combination Proposal will have no effect (even if approved by the requisite

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vote of our stockholders at the FRLA Special Meeting of any adjournment or postponement thereof) and the Business Combination will not occur.

This FRLA Business Combination Proposal (and consequently, the Business Combination Agreement and the transactions contemplated thereby, including the Business Combination) will be approved and adopted only if holders of at least a majority of the issued and outstanding FRLA Shares present in person by virtual attendance or represented by proxy and entitled to vote at the FRLA Special Meeting vote “FOR” the Business Combination Proposal.

Pursuant to the Sponsor Letter Agreement and the Sponsor Letter Agreement, the Initial Stockholders holding an aggregate of 2,283,750 FRLA Shares (or approximately 36% of the outstanding FRLA Shares) have agreed to vote their respective FRLA Shares in favor of each of the Proposals. As a result, only 26,650 Public Shares will need to be present in person by virtual attendance or by proxy to satisfy the quorum requirement for the FRLA Special Meeting. In addition, as the vote to approve the FRLA Business Combination Proposal is a majority of the votes cast at a meeting at which a quorum is present, assuming only the minimum number of FRLA Shares to constitute a quorum is present, no Public Shares, or must vote in favor of the Business Combination Proposal for it to be approved.

Board Recommendation

OUR BOARD RECOMMENDS THAT OUR STOCKHOLDERS VOTE “FOR” THE FRLA BUSINESS COMBINATION PROPOSAL.

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FRLA PROPOSAL 2 – THE FRLA CHARTER AMENDMENT PROPOSAL

Overview

Our stockholders are being asked to adopt the Amended Charter in the form attached to this proxy statement/prospectus/consent solicitation statement as Annex B, to be effective upon the consummation of the Business Combination. The Charter Amendment Proposal is conditioned on the approval of the Business Combination Proposal. Therefore, if the Business Combination Proposal is not approved, then the Charter Amendment Proposal will have no effect, even if approved by FRLA’s stockholders. The Charter Amendment Proposal is not conditioned on the separate approval of the FRLA Advisory Charter Proposals.

Reasons for the FRLA Charter Amendment Proposal

The Amended Charter was negotiated as part of the Business Combination. The following is a summary of the key amendments effected by the Amended Charter relative to the Current Charter, as well as the FRLA Board’s reasons for asking the stockholders of FRLA to approve the FRLA Charter Amendment Proposal. This summary is qualified in its entirety by reference to the full text of the Amended Charter, a copy of which is included as Annex B. All FRLA stockholders and other interested parties are encouraged to read the proposed Amended Charter in its entirety for a more complete description of its terms.

Changes to Authorized Capital Stock

 

The Amended Charter would increase the total number of shares of all classes that the Company is authorized to issue to provide that the total number of shares of all classes of capital stock which the Company will have authority to issue to 100,000,000 shares, of which are 80,000,000 shares are designated as common stock, par value $0.0001 per share (“Common Stock”), and 20,000,000 shares are designated as preferred stock, par value $0.0001 per share (the “Preferred Stock”).

Right of Stockholders to Act by Written Consent

The Amended Charter would provide the right of the stockholders of the Combined Company to act by written consent except to the extent otherwise provided in our bylaws.

Right of Stockholders to Call Meetings

The Amended Charter would provide the right of the stockholders of the Combined Company to call a special stockholder meeting to the extent otherwise provided in our bylaws.

Vote Required for Approval

Assuming that a quorum is present at the FRLA Special Meeting, the affirmative vote of holders of a majority of the issued and outstanding FRLA Shares on this Proposal 2 is required to approve the FRLA Charter Amendment Proposal. Accordingly, a stockholder’s failure to vote online during the FRLA Special Meeting or by proxy, a broker non-vote or an abstention will be considered a vote “AGAINST” Proposal 2.

This Proposal is conditioned on the approval of the FRLA Business Combination Proposal, the FRLA Incentive Plan Proposal, the FRLA Director Election Proposal, and the FRLA Nasdaq Proposal. If either of the FRLA Business Combination Proposal, the FRLA Incentive Plan Proposal, the FRLA Director Election Proposal, and the FRLA Nasdaq Proposal is not approved, Proposal 2 will have no effect even if approved by our stockholders.

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Because stockholder approval of this FRLA Proposal 2 is a condition to completion of the Business Combination under the Business Combination Agreement, if this Proposal 2 is not approved by our stockholders, the Business Combination will not occur unless we and WODI waive the applicable closing conditions.

Board Recommendation

THE BOARD RECOMMENDS A VOTE “FOR” ADOPTION OF THE FRLA CHARTER AMENDMENT PROPOSAL.

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FRLA PROPOSAL 3 – THE FRLA ADVISORY CHARTER PROPOSALS

General

We are asking our stockholders to vote on separate proposals with respect to certain governance provisions in the Amended Charter, which are separately being presented in accordance with SEC guidance to give stockholders the opportunity to present their separate views on important corporate governance provisions and which will be voted upon on a non-binding advisory basis. This separate vote is not otherwise required by Delaware law, but pursuant to SEC guidance, we are required to submit these provisions to its stockholders separately for approval. The stockholder votes regarding these proposals are advisory in nature, and are not binding on FRLA, the FRLA Board, the Combined Company or the Combined Company Board. Furthermore, the Business Combination is not conditioned on the separate approval of the FRLA Advisory Charter Proposals. Accordingly, regardless of the outcome of the non-binding advisory vote on these proposals, FRLA intends that the Amended Charter will take effect at the Closing, assuming adoption of the Business Combination Proposal. This summary is qualified in its entirety by reference to the full text of the Amended Charter, a copy of which is appended to this proxy statement/prospectus as Annex B.

Proposal 3A: Changes to Authorized Capital Stock

Description of Amendment

The Amended Charter would increase the total number of shares of all classes that the Company is authorized to issue to provide that the total number of shares of all classes of capital stock which the Company will have authority to issue to 100,000,000 shares, of which are 80,000,000 shares are designated as common stock, par value $0.0001 per share (“Common Stock”), and 20,000,000 shares are designated as preferred stock, par values $0.0001 per share (the “Preferred Stock”).

Reason for Amendment

This amendment provides for adequate authorized capital and flexibility for future issuances of Common Stock if determined by the Combined Company Board to be in the best interests of the Combined Company’s business, without incurring the risk, delay and potential expense incident to obtaining stockholder approval for a particular issuance.

Proposal 3B: Right of Stockholders to Act by Written Consent

Description of Amendment

The Amended Charter would provide the right of the stockholders of the Combined Company to act by written consent except to the extent otherwise provided in our bylaws.

Reason for Amendment

This amendment provides flexibility for the Combined Company to take certain actions by written consent and without the need for calling a special meeting.

Proposal 3C: Right of Stockholders to Call Meetings

Description of Amendment

The Amended Charter would provide the right of the stockholders of the Combined Company to call a special stockholder meeting to the extent otherwise provided in our bylaws.

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Reason for Amendment

This gives the shareholders the rights to call a special meeting if the holders of at least 25% of the voting power of the outstanding shares of the Corporation then entitled to vote.

Required Vote

The approval of each of the FRLA Advisory Charter Proposals, each of which is non-binding, requires the affirmative vote of a majority of the voting power of FRLA Shares, present in person (which would include presence at the virtual Special Meeting) or represented by proxy and entitled to vote thereon, voting together as a single class. Abstentions will have the same effect as a vote “AGAINST” the FRLA Advisory Charter Proposals but broker non-votes will have no effect on the FRLA Advisory Charter Proposals.

As discussed above, the FRLA Advisory Charter Proposals are advisory votes and therefore are not binding on FRLA or the FRLA Board. Furthermore, the business combination is not conditioned on the separate approval of the FRLA Advisory Charter Proposals. Accordingly, regardless of the outcome of the non-binding advisory vote on the FRLA Advisory Charter Proposals, FRLA intends that the Amended Charter will take effect upon consummation of the business combination.

Board Recommendation

THE BOARD RECOMMENDS A VOTE “FOR” ADOPTION OF THE FRLA ADVISORY CHARTER PROPOSALS.

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FRLA PROPOSAL 4 – THE FRLA INCENTIVE PLAN PROPOSAL

Overview

We are asking our stockholders to approve and adopt the Water on Demand, Inc. 2024 Equity Incentive Plan (the “Incentive Plan”) and the material terms thereunder.

The Incentive Plan is described in more detail below. A copy of the Incentive Plan is included in this proxy statement/prospectus/consent solicitation statement as Annex D.

The FRLA Board has approved and adopted, subject to FRLA stockholder approval, the Incentive Plan. If the Incentive Plan is approved by the stockholders, the Combined Company will be authorized to grant equity awards to eligible service providers following consummation of the Business Combination. The form of the Incentive Plan is attached to this proxy statement/prospectus/consent solicitation statement as Annex D.

Purpose of the Incentive Plan Proposal

The purpose of the Incentive Plan is to promote the long-term success of the Combined Company and the creation of stockholder value by encouraging service providers to focus on critical long-range corporate objectives and linking service providers directly to stockholder interests through increased stock ownership. FRLA believes that the Incentive Plan will be important in helping to attract and retain and motivate persons who make (or are expected to make) important contributions by providing these individuals with equity ownership opportunities and/or equity-linked compensatory opportunities. Reasons for the Approval of the Incentive Plan Proposal

Stockholder approval of the Incentive Plan is necessary in order for the Combined Company to (a) meet the stockholder approval requirements of the Nasdaq and (b) grant incentive stock options (“ISOs”). Stockholders are also being asked to approve an annual limitation on Incentive Plan awards granted to non-employee directors as part of their compensation for their services as directors.

Consequences if the Incentive Plan Proposal is Not Approved

If the Incentive Plan is not approved by FRLA’s stockholders, the Incentive Plan will not become effective and the Combined Company will not be able to grant equity awards under the Incentive Plan. FRLA believes that the Combined Company’s ability to recruit, retain and incentivize top talent will be adversely affected if the Incentive Plan is not approved.

Summary of the Incentive Plan

This section summarizes certain principal features of the Incentive Plan. The summary is qualified in its entirety by reference to the complete text of the Incentive Plan to be included as Annex D to proxy statement/prospectus/consent solicitation statement.

Material Terms of the Incentive Plan

The material terms of the Incentive Plan, as currently contemplated by FRLA’s Board, are summarized below. This summary, however, is not intended to be a complete description of the Incentive Plan and is qualified in its entirety by reference to the complete text of the Incentive Plan, the form of which is attached to this proxy statement/prospectus/consent solicitation statement as Annex D. To the extent there is a conflict between the terms of this summary and the Incentive Plan, the terms of the Incentive Plan will control.

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Plan Administration. The Combined Company Board, or a duly authorized committee of the Combined Company Board, will administer the Incentive Plan. The Combined Company Board may also delegate to one or more persons or bodies the authority to do one or more of the following: (i) designate recipients (other than officers) of specified stock awards, provided that no person or body may be delegated authority to grant a stock award to themselves (each individual participating in the Incentive Plan, a “Participant”); (ii) determine the number of shares subject to such stock award; and (iii) determine the terms of such stock awards. Under the Incentive Plan, the Combined Company Board also generally has the authority to effect, with the consent of any adversely affected participant:

 

•

the reduction of the exercise, purchase, or strike price of any outstanding award;

 

•

the cancellation of any outstanding award and the grant in substitution therefore of other awards, cash, or other consideration; or

 

•

any other action that is treated as a repricing under generally accepted accounting principles.

Types of Awards. The Incentive Plan provides for the grant of stock options, which may be incentive stock options (“ISOs”) or non-statutory stock options (“NSOs”), stock appreciation rights (“SARs”), restricted stock awards, restricted stock unit awards (“RSUs”) and other stock awards that the Incentive Plan Administrator determines are consistent with the purpose of the Incentive Plan and the interests of the Combined Company, or collectively, awards (each a “Stock Award”).

Share Reserve. Subject to certain capitalization adjustments, the aggregate number of shares of the Combined Company’s Common Stock that may be issued under the Incentive Plan will not exceed [____] shares (the “Share Reserve”). Subject to the Share Reserve and certain capitalization adjustments, the aggregate maximum number of shares of Common Stock that may be issued pursuant to the exercise of ISOs will be 100,000 shares of Common Stock. The stock issuable under the Plan will be shares of authorized but unissued or reacquired Common Stock, including shares repurchased by the Company on the open market or otherwise.

If a Stock Award or any portion thereof (i) expires or otherwise terminates without all of the shares covered by such Stock Award having been issued or (ii) is settled in cash (i.e., the Participant receives cash rather than stock), such expiration, termination or settlement will not reduce (or otherwise offset) the number of shares of Common Stock that may be available for issuance under the Incentive Plan. If any shares of Common Stock issued pursuant to a Stock Award are forfeited back to or repurchased by the Combined Company because of the failure to meet a contingency or condition required to vest such shares in the Participant, then the shares that are forfeited or repurchased will revert to and again become available for issuance under the Incentive Plan. Any shares reacquired by the Combined Company in satisfaction of tax withholding obligations on a Stock Award or as consideration for the exercise or purchase price of a Stock Award will again become available for issuance under the Incentive Plan. Shares issued under the Incentive Plan may be authorized but unissued shares or treasury shares. As of the date hereof, no awards have been granted under the Incentive Plan.

Annual Limitation on Compensation of Non-Employee Directors. The grant date fair value of awards granted to each non-employee director during any fiscal year of the Combined Company may not exceed $25,000 (on a per-director basis). This limit is increased to $30,000 in the fiscal year a non-employee director is initially appointed or elected to the Combined Company’s Board. The Combined Company’s Board may make exceptions to such limit for a non-employee chairperson or, in extraordinary circumstances, for other non-employee directors, provided the non-employee director receiving such additional compensation does not participate in the decision to award such compensation. Compensation paid to an individual for services as an employee or consultant and awards granted in lieu of cash retainers or other fees will not count towards these limitations.

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Eligibility. Employees (including officers), non-employee directors and consultants who render services to the Combined Company or a parent thereof (whether now existing or subsequently established) are eligible to receive awards under the Incentive Plan. ISOs may only be granted to employees of the Combined Company or a parent or subsidiary thereof (whether now existing or subsequently established). As of and assuming Closing of the Business Combination, approximately 35 employees, including 4 executive officers (1 of which is an employee director), 5 non-employee directors, and no consultants would be eligible to participate in the Incentive Plan.

Pursuant to the Incentive Plan, an employee holding more than 10 percent of the Common Stock of the Combined Company will not be granted an ISO unless the exercise price of such option is at least one hundred ten percent (110%) of the Fair Market Value (as defined in the Incentive Plan) on the date of grant and the option is not exercisable after the expiration of five years from the date of grant.

International Participation. The Incentive Plan Administrator has the authority to implement sub-plans (or otherwise modify applicable grant terms) for purposes of satisfying applicable foreign laws, conforming to applicable market practices or for qualifying for favorable tax treatment under applicable foreign laws, and the terms and conditions applicable to awards granted under any such sub-plan or modified award may differ from the terms of the Incentive Plan. Any shares issued in satisfaction of awards granted under a sub-plan will come from the Incentive Plan share reserve.

Repricing. The Incentive Plan Administrator has full authority to reprice (reduce the exercise price of) options and stock appreciation rights or to approve programs in which options and stock appreciation rights are exchanged for cash or other equity awards on terms the Incentive Plan Administrator determines.

Stock Options. A stock option is the right to purchase a certain number of shares of stock at a fixed exercise price which, pursuant to the Incentive Plan, may not be less than 100% of the fair market value of the Combined Company’s Common Stock on the date of grant. Subject to limited exceptions, an option may have a term of up to 10 years and will generally expire sooner if the optionee’s service terminates. Options will vest at the rate determined by the Incentive Plan Administrator. An optionee may pay the exercise price of an option in cash, or, with the administrator’s consent, with shares of stock the optionee already owns, with proceeds from an immediate sale of the option shares through a broker approved by us, through a net exercise procedure or by any other method permitted by applicable law.

Tax Limitations on Incentive Stock Options. The aggregate fair market value, determined at the time of grant, of the Combined Company’s Common Stock with respect to ISOs that are exercisable for the first time by an option holder during any calendar year under all of the Combined Company’s stock plans may not exceed $100,000. Options or portions thereof that exceed such limit will generally be treated as NSOs. No ISO may be granted to any person who, at the time of the grant, owns or is deemed to own stock possessing more than 10% of the Combined Company’s total combined voting power or that of any of the Combined Company’s affiliates unless (a) the option exercise price is at least 110% of the fair market value of the stock subject to the option on the date of grant and (b) the term of the ISO does not exceed five years from the date of grant.

Stock Appreciation Rights. An SAR provides the recipient with the right to the appreciation in a specified number of shares of stock. The Incentive Plan Administrator determines the exercise price of SARs granted under the Incentive Plan, which may not be less than 100% of the fair market value of the Combined Company’s Common Stock on the date of grant. Subject to limited exceptions, an SAR may have a term of up to 10 years and will generally expire sooner if the recipient’s service terminates. SARs will vest at the rate determined by the Incentive Plan Administrator. Upon exercise of a SAR, the recipient will receive an amount in cash, stock, or a combination of stock and cash determined by the Incentive Plan Administrator, equal to the excess of the fair market value of the shares being exercised over their exercise price.

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Restricted Stock Awards. Shares of restricted stock may be issued under the Incentive Plan for such consideration as the Incentive Plan Administrator may determine, including cash, services rendered or to be rendered to the Combined Company or such other forms of consideration permitted under applicable law. Restricted shares may be subject to vesting, as determined by the Incentive Plan Administrator. Recipients of restricted shares generally have all of the rights of a stockholder with respect to those shares, including voting rights, however any dividends and other distributions on restricted shares will generally be subject to the same restrictions on transferability and forfeitability as the underlying shares.

Restricted Stock Units. An RSU is a right to receive a share, at no cost to the recipient, upon satisfaction of certain conditions, including vesting conditions, established by the Incentive Plan Administrator. RSUs vest at the rate determined by the Incentive Plan Administrator and any unvested RSUs will generally be forfeited upon termination of the recipient’s service. Settlement of RSUs may be made in the form of cash, stock or a combination of cash and stock, as determined by the Incentive Plan Administrator. Recipients of RSUs generally will have no voting or dividend rights prior to the time the vesting conditions are satisfied and the award is settled. At the Incentive Plan Administrator’s discretion and as set forth in the applicable RSU agreement, RSUs may provide for the right to dividend equivalents which will generally be subject to the same conditions and restrictions as the RSUs to which they pertain.

Other Awards. The Incentive Plan Administrator may grant other awards based in whole or in part by reference to the Combined Company’s Common Stock and may grant awards under other plans and programs that will be settled with shares issued under the Incentive Plan. The Incentive Plan Administrator will determine the terms and conditions of any such awards.

Changes to Capital Structure. In the event of certain changes in capitalization, including a stock split, reverse stock split or stock dividend, proportionate adjustments will be made in the number and kind of shares available for issuance under the Incentive Plan, the limit on the number of shares that may be issued under the Incentive Plan as ISOs, the number and kind of shares subject to each outstanding award and/or the exercise price of each outstanding award.

Corporate Transactions. If the Combined Company is party to a merger, consolidation or certain change in control transactions, each outstanding award will be treated as described in the definitive transaction agreement or as the Incentive Plan Administrator determines, which may include the continuation, assumption or substitution of an outstanding award, the cancellation of an outstanding award after an opportunity to exercise or the cancellation of an outstanding award in exchange for a payment equal to the value of the shares subject to such award less any applicable exercise price. In general, if an award held by a participant who remains in service at the effective time of a change in control transaction is not continued, assumed or substituted, then the award will vest in full.

Change in Control. The Incentive Plan Administrator may provide, in an individual award agreement or in any other written agreement with a participant, that the award will be subject to acceleration of vesting and exercisability in the event of a change in control or in connection with a termination of employment in connection with or following a change in control.

Transferability of Awards. Unless the Incentive Plan Administrator determines otherwise, an award generally will not be transferable other than by beneficiary designation, a will or the laws of descent and distribution. The Incentive Plan Administrator may permit transfer of an award in a manner consistent with applicable law.

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Amendment and Termination. The Incentive Plan Administrator may amend or terminate the Incentive Plan at any time. Any such amendment or termination will not affect outstanding awards. If not sooner terminated, the Incentive Plan will terminate automatically 10 years after its adoption by the FRLA Board. Stockholder approval is not required for any amendment of the Incentive Plan, unless required by applicable law, government regulation or exchange listing standards.

Certain Federal Income Tax Aspects of Awards Under the Incentive Plan

This is a brief summary of the U.S. federal income tax aspects of awards that may be made under the Incentive Plan based on existing U.S. federal income tax laws as of the date of this this joint proxy statement/consent solicitation statement/prospectus. This summary covers only the basic tax rules. It does not describe a number of special tax rules, including the alternative minimum tax and various elections that may be applicable under certain circumstances. It also does not reflect provisions of the income tax laws of any municipality, state or foreign country in which a holder may reside, nor does it reflect the tax consequences of a holder’s death. Therefore, no one should rely on this summary for individual tax compliance, planning or decisions. Participants in the Incentive Plan should consult their own professional tax advisors concerning tax aspects of awards under the Incentive Plan. The discussion below concerning tax deductions that may become available to the Combined Company under U.S. federal tax law is not intended to imply that the Combined Company will necessarily obtain a tax benefit or asset from those deductions. The tax consequences of awards under the Incentive Plan depend upon the type of award. Changes to tax laws following the date of this proxy statement/prospectus/consent solicitation statement could alter the tax consequences described below.

Incentive Stock Options. No taxable income is recognized by an optionee upon the grant or vesting of an ISO, and no taxable income is recognized at the time an ISO is exercised unless the optionee is subject to the alternative minimum tax. The excess of the fair market value of the purchased shares on the exercise date over the exercise price paid for the shares is includable in alternative minimum taxable income.

If the optionee holds the purchased shares for more than one year after the date the ISO was exercised and more than two years after the ISO was granted (the “required ISO holding periods”), then the optionee will generally recognize long-term capital gain or loss upon disposition of such shares. The gain or loss will equal the difference between the amount realized upon the disposition of the shares and the exercise price paid for such shares. If the optionee disposes of the purchased shares before satisfying either of the required ISO holding periods, then the optionee will recognize ordinary income equal to the fair market value of the shares on the date the ISO was exercised over the exercise price paid for the shares (or, if less, the amount realized on a sale of such shares). Any additional gain will be a capital gain and will be treated as short-term or long-term capital gain depending on how long the shares were held by the optionee.

Nonstatutory Stock Options. No taxable income is recognized by an optionee upon the grant or vesting of an NSO, provided the NSO does not have a readily ascertainable fair market value. If the NSO does not have a readily ascertainable fair market value, the optionee will generally recognize ordinary income in the year in which the option is exercised equal to the excess of the fair market value of the purchased shares on the exercise date over the exercise price paid for the shares. If the optionee is an employee or former employee, the optionee will be required to satisfy the tax withholding requirements applicable to such income. Upon resale of the purchased shares, any subsequent appreciation or depreciation in the value of the shares will be treated as short-term or long-term capital gain or loss depending on how long the shares were held by the optionee.

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Restricted Stock. A participant who receives an award of restricted stock generally does not recognize taxable income at the time of the award. Instead, the participant recognizes ordinary income when the shares vest, subject to withholding if the participant is an employee or former employee. The amount of taxable income is equal to the fair market value of the shares on the vesting date(s) less the amount, if any, paid for the shares. Alternatively, a participant may make a one-time election to recognize income at the time the participant receives restricted stock in an amount equal to the fair market value of the restricted stock (less any amount paid for the shares) on the date of the award by making an election under Section 83(b) of the Code.

Restricted Stock Unit Awards. In general, no taxable income results upon the grant of an RSU. The recipient will generally recognize ordinary income, subject to withholding if the recipient is an employee or former employee, equal to the fair market value of the shares that are delivered to the recipient upon settlement of the RSU. Upon resale of the shares acquired pursuant to an RSU, any subsequent appreciation or depreciation in the value of the shares will be treated as short-term or long-term capital gain or loss depending on how long the shares were held by the recipient.

Stock Appreciation Rights. In general, no taxable income results upon the grant of a SAR. A participant will generally recognize ordinary income in the year of exercise equal to the value of the shares or other consideration received. In the case of a current or former employee, this amount is subject to withholding.

Section 409A. The foregoing description assumes that Section 409A of the Code does not apply to an award. In general, options and stock appreciation rights are exempt from Section 409A if the exercise price per share is at least equal to the fair market value per share of the underlying stock at the time the option or stock appreciation right was granted. RSUs are subject to Section 409A unless they are settled within two and one half months after the end of the later of (a) the end of the Combined Company’s fiscal year in which vesting occurs or (b) the end of the calendar year in which vesting occurs. Restricted stock awards are not generally subject to Section 409A. If an award is subject to Section 409A and the provisions for the exercise or settlement of that award do not comply with Section 409A, then the participant would be required to recognize ordinary income whenever a portion of the award vested (regardless of whether it had been exercised or settled). This amount would also be subject to a 20% U.S. federal tax and premium interest in addition to the U.S. federal income tax at the participant’s usual marginal rate for ordinary income.

Tax Treatment of the Combined Company. The Combined Company will generally be entitled to an income tax deduction at the time and to the extent a participant recognizes ordinary income as a result of an award granted under the Incentive Plan. However, Section 162(m) of the Code may limit the deductibility of certain awards granted under the Incentive Plan. Although the Incentive Plan Administrator considers the deductibility of compensation as one factor in determining executive compensation, the Incentive Plan Administrator retains the discretion to award and pay compensation that is not deductible as it believes that it is in the stockholders’ best interests to maintain flexibility in the approach to executive compensation and to structure a program that the Combined Company considers to be the most effective in attracting, motivating and retaining key employees.

Incentive Plan Benefits

Benefits to be received under the Incentive Plan are not determinable since they depend on discretionary decisions to be made by the Incentive Plan Administrator regarding which participants are selected and what awards are made under the Incentive Plan.

Registration with the SEC

If the Incentive Plan is approved by FRLA’s stockholders and becomes effective, FRLA intends to file a registration statement on Form S-8 registering the shares of the Combined Company’s Common Stock reserved for issuance under the Incentive Plan as soon as reasonably practicable after FRLA becomes eligible to use such form.

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Required Vote

This FRLA Incentive Plan Proposal will be approved and adopted only if holders of at least a majority of the issued and outstanding shares of common stock present in person by virtual attendance or represented by proxy and entitled to vote at the FRLA Special Meeting vote “FOR” the Incentive Plan Proposal.

This FRLA Incentive Plan Proposal is conditioned upon the approval and completion of the FRLA Business Combination Proposal, the FRLA Charter Amendment Proposal, the FRLA Director Election Proposal, and the FRLA Nasdaq Proposal. If any of the FRLA Business Combination Proposal, the FRLA Charter Amendment Proposal, the FRLA Director Election Proposal, or the FRLA Nasdaq Proposal are not approved, unless the condition is waived, this Proposal will have no effect even if approved by our stockholders.

Board Recommendation

OUR BOARD RECOMMENDS THAT OUR STOCKHOLDERS VOTE “FOR” THE FRLA INCENTIVE PLAN PROPOSAL.

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FRLA PROPOSAL 5 – THE FRLA DIRECTOR ELECTION PROPOSAL

Overview

Pursuant to the Business Combination Agreement, FRLA stockholders are being asked to elect the following six nominees as directors to serve on the Board until the completion of their term or until his or her successor shall have been elected and qualified:

·T. Riggs Eckelberry 

·Stephen Hall 

·Taron Lexton 

·Beau Vuillemot 

·Leslie Brock 

·Jean-Louis Kindler 

The following sets forth information regarding each nominee:

T. Riggs Eckelberry – Chief Executive Officer, Chairman of the Board of Directors, Secretary, Treasurer, and President

Mr. Eckelberry has served as OCLN’s Chief Executive Officer, Chairman, Secretary, Treasurer, and President since OCLN was acquired in October 2015. As co-founder, Mr. Eckelberry brings his veteran technology management skills to the Blue Technology sector. Prior to joining OCLN, Mr. Eckelberry served as President and COO of CyberDefender Corporation from 2005 to 2006, where he was instrumental in building the company and its innovative product line, helping to achieve initial funding and a NASDAQ IPO. From 2001 to mid-2005, he served as founder and President of TechTransform, a technology consulting firm. From 2003 to 2004, he served as a marketing consultant where he was a key member of the team that commercialized YellowPages.com, resulting in its sale for $100 million to SBC/BellSouth. In 2003, Mr. Eckelberry served as the U.S. General Manager of Panda Software. During the high-tech boom of the 1990s, he was responsible for the global brand success of the software product, CleanSweep; as Chief Operating Officer of MicroHouse Technologies, he helped to achieve a successful sale of the company to Earthweb; and he was a key member of the team that sale of venture-backed TriVida to what is now a division of ValueClick. Mr. Eckelberry does not have any arrangement or understanding between him and any other person(s) pursuant to which he was or is to be selected as a director or nominee.

Stephen Hall, Director

Stephen Hall has a diverse range of expertise spanning the fields of taxation, technology, and entrepreneurship. For over a decade, Mr. Hall has been the Chief Executive Officer of Robert Hall & Associates, a leading regional tax accounting firm. Stephen and his team of experts provide invaluable guidance and support in navigating the complexities of taxation. Under Mr. Hall’s leadership, Robert Hall & Associates has gained recognition for its exceptional services and industry insights. The firm’s expertise in the taxation of influencers online was recently highlighted by the Wall Street Journal, solidifying their position as thought leaders in the field. Mr. Hall also serves as a board member or advising several emerging companies in the food, technology, and gaming industries. Mr. Hall holds a bachelor of science from the University of Southern California in Management Consulting as well as Marketing and holds a title of Fellow from the National Enrolled Agents Society.

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Taron Lexton, Director

Taron Lexton is the founder of TXL Films, which he founded in 2004. Mr. Lexton was educated at the LA Film School. He has received the United Nations Award of Excellence and more than 100 film festival awards.  Mr. Lexton does not have any arrangement or understanding between him and any other person(s) pursuant to which he was or is to be selected as a director or nominee.

Leslie Brock, Director

Leslie Brock is an experienced business executive with an entrepreneurial interest in developing startups that feature innovative, proprietary products. Ms. Brock is an Executive Vice President with over 28 years’ experience in heavy-duty transportation manufacturing, Ms. Brock is a co-owner of ATRO Engineered Systems, which she founded in 1989. Ms. Brock holds a B.S. degree in Business from the University of Missouri - Columbia. Ms. Brock does not have any arrangement or understanding between her and any other person(s) pursuant to which she was or is to be selected as a director or nominee.

Beau Vuillemot, Director

Beau Vuillemot cofounded Viking Revolution LLC, an ecommerce business with a proprietary line of men’s grooming products, in October 2016. In 2018, Viking Revolution LLC was acquired and Mr. Vuillemot now serves as its Chief Marketing Officer.  Mr. Vuillemot does not have any arrangement or understanding between him and any other person(s) pursuant to which he was or is to be selected as a director or nominee.

Jean-Louis Kindler, Director

Mr. (“JL”) Kindler has served as our director since May 2022. As President of OriginClear Technologies, he led the commercialization of OriginClear’s breakthrough water treatment technology. Since 2019, he has been the CEO of Clean Energy Enterprises Inc., established to commercialize the Blue Tower biomass-to-hydrogen system he helped develop two decades ago in Japan. Mr. Kindler is a veteran of 25 years as both a top executive and engineer in environmental technologies. Before OriginClear, JL was co-founder and Chief Technology Officer of Ennesys, the company’s French joint venture, where he designed its patent-pending waste-to-energy system. Earlier, as founding CEO of MHS Equipment, a French nanotechnologies equipment manufacturing firm, he led the development of a breakthrough fuel cell process. And earlier still, his twenty-year career in Japan gave him unique insight into fast-growing Asian markets. There, as principal of technology incubator Pacific Junction, JL completed various assignments. These included technology sourcing for the French industrial group GEC-Altshom, building the first commercial unit of the Blue Tower (to which he has recently returned in its now-fourth generation), and market development for a fluids mixing technology that helped inspire early OriginClear inventions. Mr. Kindler holds a Master’s in Economics and Public Policy from the Institute of Political Science in Lyon, France, and an MBA in International Management in Paris. Mr. Kindler’s executive and management experience, and past involvement in the company’s technology and operations, qualifies him to serve as a member of our board of directors. Mr. Kindler does not have any arrangement or understanding between him and any other person(s) pursuant to which he was or is to be selected as a director or nominee.

Director Independence

Nasdaq listing rules require that a majority of the board of directors of a company listed on Nasdaq be composed of “independent directors,” which is defined generally as a person other than an officer or employee of the company or its subsidiaries or any other individual having a relationship, which, in the opinion of the company’s board of directors, would interfere with the director’s exercise of independent judgment in carrying out the responsibilities of a director. The Combined Company’s Board of Directors has determined that, upon the consummation of the Business Combination, each of Stephen Hall, Steve Glovsky, Taron Lexton, Beau Vuillemot and Leslie Brock, will be an independent director under the Nasdaq listing rules and Rule 10A-3 of the Exchange Act. In making these

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determinations, the Combined Company’s Board of Directors considered the current and prior relationships that each non-employee director has with WODI and will have with the combined company and all other facts and circumstances the Combined Company’s Board of Directors deemed relevant in determining independence, including the beneficial ownership of our common stock by each non-employee director, and the transactions involving them described in the section entitled “Certain Relationships and Related Party Transactions.”

Required Vote

Assuming that a quorum is present at the FRLA Special Meeting, directors are elected by a plurality of all of the votes cast by the stockholders present in person (which would include presence at a virtual meeting) or represented by proxy at the FRLA Special Meeting. This means that the six director nominees who receive the most affirmative votes will be elected. Stockholders may not cumulate their votes with respect to the election of directors. Accordingly, a stockholder’s failure to vote by proxy or to vote in person (which would include presence at a virtual meeting) at the FRLA Special Meeting, as well as an abstention from voting and a broker non-vote with regard to the FRLA Director Election Proposal, will have no effect on the FRLA Director Election Proposal.

This Proposal is conditioned on the approval of the FRLA Business Combination Proposal, the FRLA Charter Amendment Proposal, the FRLA Incentive Plan Proposal, and the FRLA Nasdaq Proposal. If either of the FRLA Business Combination Proposal, the FRLA Charter Amendment Proposal, the FRLA Incentive Plan Proposal, and the FRLA Nasdaq Proposal is not approved, Proposal 5 will have no effect even if approved by our stockholders.

Because stockholder approval of this FRLA Proposal 5 is a condition to completion of the Business Combination under the FRLA Business Combination Agreement, if this Proposal 5 is not approved by our stockholders, the Business Combination will not occur unless we and WODI waive the applicable closing conditions.

Board Recommendation

THE BOARD RECOMMENDS A VOTE “FOR” ADOPTION OF THE FRLA DIRECTOR ELECTION PROPOSAL.

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FRLA PROPOSAL 6 – THE FRLA NASDAQ PROPOSAL

Overview

We are proposing the Nasdaq Proposal in order to comply with Nasdaq Listing Rules 5635(a), (b), and (d). Under Nasdaq Listing Rule 5635(a), stockholder approval is required prior to the issuance of securities in connection with the acquisition of another company if such securities are not issued in a public offering and (A) have, or will have upon issuance, voting power equal to or in excess of 20% of the voting power outstanding before the issuance of common stock (or securities convertible into or exercisable for common stock); or (B) the number of shares of common stock to be issued is or will be equal to or in excess of 20% of the number of shares of common stock outstanding before the issuance of the stock or securities. Under Nasdaq Listing Rule 5635(b), stockholder approval is required prior to the issuance of securities when the issuance or potential issuance will result in a change of control.

Pursuant to the Business Combination Agreement, based on WODI’s current capitalization, we anticipate that we will issue to the WODI shareholders as consideration in the Business Combination, 3,542,691 shares of Common Stock. See the section titled “FRLA Proposal 1 – The FRLA Business Combination Proposal — Merger Consideration.” Because the number of shares of common stock we anticipate issuing as consideration in the Business Combination (1) will constitute more than 20% of our outstanding common stock and more than 20% of outstanding voting power prior to such issuance and (2) will result in a change of control of FRLA, we are required to obtain stockholder approval of such issuance pursuant to Nasdaq Listing Rules 5635(a) and (b).

Effect of Proposal on Current Stockholders

If the FRLA Nasdaq Proposal is adopted, FRLA would issue shares representing more than 20% of the outstanding shares FRLA Shares in connection with the Business Combination. The issuance of such shares would result in significant dilution to the FRLA stockholders and would afford such stockholders a smaller percentage interest in the voting power, liquidation value and aggregate book value of FRLA. If the FRLA Nasdaq Proposal is adopted, assuming that 3,542,691 shares of Common Stock are issued to the WODI shareholders as consideration in the Business Combination and no redemptions occur, the WODI shareholders will hold approximately 42.8% of our outstanding shares of Common Stock, the current FRLA public stockholders will hold 38.1% of our outstanding Common Stock, the Representatives will hold approximately 1.4% of our outstanding shares of Common Stock and the Sponsor will hold 17.7% of our outstanding Common Stock immediately following completion of the Business Combination. These percentages assume that no Public Shares are redeemed in connection with the Business Combination, and do not take into account any warrants or options to purchase our common stock that will be outstanding following the Business Combination or any equity awards that maybe issued under our proposed Incentive Plan following the Business Combination.

If the Nasdaq Proposal is not approved and we consummate the Business Combination on its current terms, FRLA would be in violation of Nasdaq Listing Rule 5635(a) and (b), which could result in the delisting of our securities from the Nasdaq Capital Market. If Nasdaq delists our securities from trading on its exchange, we could face significant material adverse consequences, including:

·a limited availability of market quotations for our securities; 

·reduced liquidity with respect to our securities; 

·determination that our shares are a “penny stock,” which will require brokers trading in our securities to adhere to more stringent rules, possibly resulting in a reduced level of trading activity in the secondary trading market for our securities; 

·a limited amount of news and analyst coverage for the post-transaction company; and 

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·a decreased ability to issue additional securities or obtain additional financing in the future. 

It is a condition to the obligations of FRLA and WODI to close the Business Combination that our common stock remain listed on the Nasdaq Capital Market. As a result, if the Nasdaq Proposal is not adopted, the Business Combination may not be completed unless this condition is waived.

Vote Required for Approval

Assuming that a quorum is present at the FRLA Special Meeting, the affirmative vote of holders of at least a majority of the issued and outstanding shares of common stock present in person by virtual attendance or represented by proxy and entitled to vote at the FRLA Special Meeting vote “FOR” the FRLA Nasdaq Proposal.

This Proposal is conditioned on the approval of the FRLA Business Combination Proposal, the FRLA Charter Amendment Proposal, the FRLA Incentive Plan Proposal and the FRLA Director Election Proposal. If either of the FRLA Business Combination Proposal, the FRLA Charter Amendment Proposal, the FRLA Incentive Plan Proposal or the FRLA Director Election Proposal is not approved, unless the condition is waived, the FRLA Nasdaq Proposal will have no effect even if approved by our stockholders.

Because stockholder approval of the FRLA Nasdaq Proposal is a condition to completion of the Business Combination under the Business Combination Agreement, if the FRLA Nasdaq Proposal is not approved by our stockholders, the Business Combination will not occur unless we and WODI waive the applicable closing condition.

Board Recommendation

OUR BOARD RECOMMENDS THAT OUR STOCKHOLDERS VOTE “FOR” THE FRLA NASDAQ PROPOSAL.

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FRLA PROPOSAL 7 – THE FRLA ADJOURNMENT PROPOSAL

The FRLA Adjournment Proposal, if adopted, will approve the chairman’s adjournment of the FRLA Special Meeting to a later date to permit further solicitation of proxies. The Adjournment Proposal will only be presented to our stockholders in the event, based on the tabulated votes, there are not sufficient votes received at the time of the FRLA Special Meeting to approve the other Proposals.

Consequences if the Adjournment Proposal is Not Approved

If the Adjournment Proposal is not approved by our stockholders, the chairman will not adjourn the FRLA Special Meeting to a later date in the event, based on the tabulated votes, there are not sufficient votes received at the time of the FRLA Special Meeting to approve the FRLA Business Combination Proposal, the FRLA Charter Amendment Proposal, the FRLA Incentive Plan Proposal, the FRLA Director Election Proposal or the FRLA Nasdaq Proposal.

Required Vote

This Adjournment Proposal will be approved and adopted only if holders of at least a majority of the issued and outstanding shares of common stock present in person by virtual attendance or represented by proxy and entitled to vote at the FRLA Special Meeting vote “FOR” the Adjournment Proposal.

The Adjournment Proposal is not conditioned on the approval of any other Proposal set forth in this proxy statement/prospectus/consent solicitation statement.

Board Recommendation

THE BOARD RECOMMENDS A VOTE “FOR” ADOPTION OF THE FRLA ADJOURNMENT PROPOSAL.

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WODI’S SOLICITATION OF WRITTEN CONSENTS

Consent Solicitation

The WODI Board is providing these consent solicitation materials. WODI shareholders are being asked to approve the Business Combination and adopt and approve the Business Combination Agreement and the transactions contemplated thereby (“WODI Business Combination Proposal”) by executing and delivering the written consent furnished with this proxy statement/prospectus/consent solicitation statement.

WODI Shareholders Entitled to Consent

Only WODI shareholders of record as of the close of business on [     ], 2024, the WODI record date (the “WODI Record Date”), will be entitled to execute and deliver a written consent. As of the close of the WODI Record Date there were 13,399,217 shares of WODI Common Stock outstanding entitled to execute and deliver a written consent with respect to the WODI Business Combination Proposal. Each holder of WODI Common Stock is entitled to one vote for each share of WODI Common Stock held as of the WODI Record Date.

Submission of Written Consents

You may consent to the proposals with respect to your shares by completing and signing the written consent furnished with this proxy statement/prospectus/consent solicitation statement and returning it to WODI on or before [     ], 2024, the date that the WODI Board has set as the targeted final date for receipt of written consents. WODI reserves the right to extend the final date for receipt of written consents beyond [     ], 2024 in the event that consents approving the WODI Business Combination Proposal have not been obtained by that date from holders of a sufficient number of shares of WODI Common Stock to satisfy the conditions to the Business Combination. Any such extension may be made without notice to the shareholders. Once all conditions of the Business Combination have been satisfied or waived, the consent solicitation will conclude.

If you hold shares of WODI Common Stock or preferred voting stock as of the WODI Record Date and you wish to give your written consent, you must fill out the enclosed written consent, date and sign it, and promptly return it to WODI. Once you have completed, dated and signed the written consent, you may deliver it to WODI by emailing a copy to Jon Peraza at jon@originclear.com.

Executing Written Consents; Revocation of Written Consents

You may execute a written consent to approve the WODI Business Combination Proposal (which is equivalent to a vote for the proposal) or disapprove each proposal (which is equivalent to a vote against the proposal). If you do not return your written consent, it will have the same effect as a vote against the proposals. If you are a record holder and you return a signed written consent without indicating your decision on a proposal, you will have given your consent to approve the Business Combination and adopt and approve the Business Combination Agreement and the transactions contemplated thereby.

Your consent to a proposal may be changed or revoked at any time before the consents of a sufficient number of shares to approve and adopt such proposal have been filed with WODI’s corporate secretary. If you wish to change or revoke a previously given consent before that time, you may do so by delivering a notice of revocation to Jon Peraza at jon@originclear.com or by delivering a new written consent with a later date.

Solicitation of Written Consents; Expenses

The expense of preparing, printing and mailing these consent solicitation materials is being borne by WODI. Officers and employees of WODI may solicit consents by telephone and personally, in addition to solicitation by mail. These persons will receive their regular salaries but no special compensation for soliciting consents.

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Recommendation of the WODI Board

THE WODI BOARD RECOMMENDS THAT WODI SHAREHOLDERS APPROVE THE BUSINESS COMBINATION AND ADOPT AND APPROVE THE BUSINESS COMBINATION AGREEMENT AND THE TRANSACTIONS CONTEMPLATED THEREBY BY EXECUTING AND DELIVERING THE WRITTEN CONSENT FURNISHED WITH THIS PROXY STATEMENT/PROSPECTUS/CONSENT SOLICITATION STATEMENT.

The WODI Board believes the Merger Consideration to WODI shareholders is fair, advisable and in the best interests of WODI and its shareholders. The Management of WODI and the WODI board, after careful study and evaluation of the economic, financial, legal and other factors, also believe the Business Combination could provide WODI with increased opportunity for profitable expansion of its business, which in turn should benefit the WODI shareholders who become shareholders of FRLA.

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MATERIAL U.S. FEDERAL INCOME TAX CONSEQUENCES

The following is a general discussion of the material U.S. federal income tax consequences (i) of the exercise of redemption rights by U.S. Holders and Non-U.S. Holders (defined below) of common stock, and(ii) of the Business Combination to U.S. Holders of WODI Common Stock.

This discussion is based on provisions of the Internal Revenue Code of 1986, as amended (the “Code”), the Treasury Regulations promulgated thereunder (whether final, temporary, or proposed), administrative rulings of the IRS, and judicial decisions, all as in effect on the date hereof, and all of which are subject to differing interpretations or change, possibly with retroactive effect. This discussion does not purport to be a complete analysis or listing of all potential U.S. federal income tax consequences that may apply to a holder as a result of the Business Combination. In addition, this discussion does not address all aspects of U.S. federal income taxation that may be relevant to particular holders nor does it take into account the individual facts and circumstances of any particular holder that may affect the U.S. federal income tax consequences to such holder, and accordingly, is not intended to be, and should not be construed as, tax advice. This discussion does not address the U.S. federal 3.8% Medicare tax imposed on certain net investment income or any aspects of U.S. federal taxation other than those pertaining to the income tax, nor does it address any tax consequences arising under any U.S. state and local, or non-U.S. tax laws. Holders should consult their own tax advisors regarding such tax consequences in light of their particular circumstances.

No ruling has been requested or will be obtained from the IRS regarding the U.S. federal income tax consequences of the Business Combination or any other related matter; thus, there can be no assurance that the IRS will not challenge the U.S. federal income tax treatment described below or that, if challenged, such treatment will be sustained by a court.

This summary is limited to considerations relevant to holders that hold common stock or WODI Common Stock as “capital assets” within the meaning of section 1221 of the Code (generally, property held for investment). This discussion does not address all aspects of U.S. federal income taxation that may be important to holders in light of their individual circumstances, including holders subject to special treatment under the U.S. tax laws, such as, for example:

·banks or other financial institutions, underwriters, or insurance companies; 

·traders in securities who elect to apply a mark-to-market method of accounting; 

·real estate investment trusts and regulated investment companies; 

·tax-exempt organizations, qualified retirement plans, individual retirement accounts, or other tax-deferred accounts; 

·expatriates or former long-term residents of the United States; 

·subchapter S corporations, partnerships or other pass-through entities or investors in such entities; 

·dealers or traders in securities, commodities or currencies; 

·grantor trusts; 

·persons subject to the alternative minimum tax; 

·U.S. persons whose “functional currency” is not the U.S. dollar; 

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·persons who received FRLA Shares or WODI Common Stock through the issuance of restricted stock under an equity incentive plan or through a tax-qualified retirement plan or otherwise as compensation; 

·persons who own (directly or through attribution) 5% or more (by vote or value) of the outstanding FRLA Shares or WODI Common Stock (excluding treasury shares); 

·holders holding FRLA Shares or WODI Common Stock as a position in a “straddle,” as part of a “synthetic security” or “hedge,” as part of a “conversion transaction,” or other integrated investment or risk reduction transaction; 

·controlled foreign corporations, passive foreign investment companies, or foreign corporations with respect to which there are one or more United States stockholders within the meaning of Treasury Regulation Section 1.367(b)-3(b)(1)(ii); or 

·the Sponsor or its affiliates. 

As used in this proxy statement/prospectus/consent solicitation statement, the term “U.S. Holder” means a beneficial owner of FRLA Shares or WODI Common Stock that is, for U.S. federal income tax purposes:

·an individual who is a citizen or resident of the United States; 

·a corporation (or other entity that is classified as a corporation for U.S. federal income tax purposes) that is created or organized in or under the laws of the United States or any State thereof or the District of Columbia; 

·an estate the income of which is subject to U.S. federal income tax regardless of its source; or 

·a trust (i) if a court within the United States is able to exercise primary supervision over the administration of the trust and one or more U.S. persons have the authority to control all substantial decisions of the trust, or (ii) that has a valid election in effect under applicable Treasury Regulations to be treated as a U.S. person for U.S. federal income tax purposes. 

A “Non-U.S. Holder” means a beneficial owner of FRLA Shares or WODI Common Stock that is neither a U.S. Holder nor a partnership (or an entity or arrangement treated as a partnership) for U.S. federal income tax purposes.

If a partnership, including for this purpose any entity or arrangement that is treated as a partnership for U.S. federal income tax purposes, holds FRLA Shares or WODI Common Stock, the U.S. federal income tax treatment of a partner in such partnership will generally depend on the status of the partner and the activities of the partnership. A holder that is a partnership and the partners in such partnership should consult their own tax advisors with regard to the U.S. federal income tax consequences of the Business Combination.

THIS SUMMARY DOES NOT PURPORT TO BE A COMPREHENSIVE ANALYSIS ORDESCRIPTION OF ALL POTENTIAL U.S. FEDERAL INCOME TAX CONSEQUENCES OF THE BUSINESS COMBINATION. IN ADDITION, THE U.S. FEDERAL INCOME TAX TREATMENT OF THE BENEFICIAL OWNERS OF FRLA SHARES OR WODI COMMON STOCK MAY BE AFFECTED BY MATTERS NOT DISCUSSED HEREIN AND DEPENDS IN SOME INSTANCES ON DETERMINATIONS OF FACT AND INTERPRETATIONS OF COMPLEX PROVISIONS OF U.S. FEDERAL INCOME TAX LAW FOR WHICH NO CLEAR PRECEDENT ORAUTHORITY MAY BE AVAILABLE. HOLDERS OF WODI COMMON STOCK SHOULD CONSULT WITH THEIR TAX ADVISORS REGARDING THE

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PARTICULAR TAX CONSEQUENCES TO THEM OF THE BUSINESS COMBINATION, INCLUDING THE APPLICABILITY AND EFFECTS OF U.S. FEDERAL, STATE, LOCAL, AND OTHER TAX LAWS.

Certain Material U.S. Federal Income Tax Consequences of Exercising Redemption Rights

U.S. Federal Income Tax Consequences to U.S. Holders

In the event that a U.S. Holder elects to redeem its Public Shares for cash, the treatment of the transaction for U.S. federal income tax purposes will depend on whether the redemption qualifies as a sale or exchange of the Public Shares under Section 302 of the Code or is treated as a corporate distribution under Section 301 of the Code with respect to the U.S. Holder. If the redemption qualifies as a sale or exchange of the Public Shares, the U.S. Holder will be treated as recognizing capital gain or loss equal to the difference between the amount realized on the redemption and such U.S. Holder’s adjusted tax basis in the Public Shares surrendered in such redemption transaction. Any such capital gain or loss generally will be long-term capital gain or loss if the U.S. Holder’s holding period for the Public Shares redeemed exceeds one year. It is unclear, however, whether the redemption rights with respect to the Public Shares may suspend the running of the applicable holding period for this purpose. Long term capital gain realized by a non-corporate U.S. Holder is currently taxed at a reduced rate. The deductibility of capital losses is subject to limitations.

If the redemption does not qualify as a sale or exchange of Public Shares, the U.S. Holder will be treated as receiving a corporate distribution. Such distributions generally will constitute dividends for U.S. federal income tax purposes to the extent paid from FRLA’s current or accumulated earnings and profits, as determined under U.S. federal income tax principles. Distributions in excess of current and accumulated earnings and profits will constitute a return of capital that will be applied against and reduce (but not below zero) the U.S. Holder’s adjusted tax basis in the Public Shares. Any remaining excess will be treated as gain realized on the sale or other disposition of the common stock. Dividends paid to a U.S. Holder that is a taxable corporation generally will qualify for the dividends received deduction if the requisite holding period is satisfied. With certain exceptions (including, but not limited to, dividends treated as investment income for purposes of investment interest deduction limitations) and provided certain holding period requirements are met, dividends paid to a non-corporate U.S. Holder generally will constitute “qualified dividends” that will be subject to tax at the maximum tax rate accorded to long-term capital gains. However, it is unclear whether the redemption rights with respect to the Public Shares may prevent a U.S. Holder from satisfying the applicable holding period requirements with respect to the dividends received deduction or the preferential tax rate on qualified dividend income, as the case may be.

Whether a redemption qualifies for sale or exchange treatment will depend largely on the total number of Public Shares treated as held by the U.S. Holder (including any Public Shares constructively owned by the U.S. Holder as a result of owning Public Warrants) relative to all of the FRLA Shares outstanding both before and after the redemption. The redemption of Public Shares generally will be treated as a sale or exchange of the Public Shares (rather than as a corporate distribution) if the redemption (i) is “substantially disproportionate” with respect to the U.S. Holder, (ii) results in a “complete termination” of the U.S. Holder’s interest in FRLA or (iii) is “not essentially equivalent to a dividend” with respect to the U.S. Holder. These tests are explained more fully below.

In determining whether any of the foregoing tests are satisfied, a U.S. Holder takes into account not only FRLA Shares actually owned by the U.S. Holder, but also FRLA Shares that are constructively owned by it. A U.S. Holder may constructively own, in addition to stock owned directly, stock owned by certain related individuals and entities in which the U.S. Holder has an interest or that have an interest in such U.S. Holder, as well as any stock the U.S. Holder has a right to acquire by exercise of an option, which would generally include FRLA Shares which could be acquired pursuant to the exercise of Public Warrants. In order to meet the substantially disproportionate test, (i) the percentage of our outstanding voting stock actually and constructively owned by the U.S. Holder immediately following the redemption of Public Shares must be less than 80% of the percentage of our outstanding voting stock actually and constructively owned by the U.S. Holder immediately before the redemption, (ii) the U.S. Holder’s percentage ownership (including constructive ownership) of our outstanding stock (both voting and nonvoting)

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immediately after the redemption must be less than 80% of such percentage ownership (including constructive ownership) immediately before the redemption; and (iii) the U.S. Holder must own (including constructive ownership), immediately after the redemption, less than 50% of the total combined voting power of all classes of our stock entitled to vote. There will be a complete termination of a U.S. Holder’s interest if either (i) all of the Public Shares actually and constructively owned by the U.S. Holder are redeemed or (ii) all of the Public Shares actually owned by the U.S. Holder are redeemed and the U.S. Holder is eligible to waive, and effectively waives in accordance with specific rules, the attribution of stock owned by certain family members and the U.S. Holder does not constructively own any other FRLA Shares. The redemption of the Public Shares will not be essentially equivalent to a dividend if a U.S. Holder’s redemption results in a “meaningful reduction” of the U.S. Holder’s proportionate interest in FRLA. Whether the redemption will result in a meaningful reduction in a U.S. Holder’s proportionate interest in FRLA will depend on the particular facts and circumstances. However, the IRS has indicated in a published ruling that even a small reduction in the proportionate interest of a small minority stockholder in a publicly held corporation who exercises no control over corporate affairs may constitute such a “meaningful reduction.” A U.S. Holder should consult with its own tax advisors as to the tax consequences of a redemption.

If none of the foregoing tests is satisfied, then the redemption will be treated as a corporate distribution. After the application of those rules regarding corporate distributions, any remaining tax basis of the U.S. Holder in the redeemed Public Shares will be added to the U.S. Holder’s adjusted tax basis in its remaining FRLA Shares, or, if it has none, to the U.S. Holder’s adjusted tax basis in its Public Warrants or possibly in other FRLA Shares constructively owned by it.

U.S. Federal Income Tax Consequences to Non-U.S. Holders

The characterization for U.S. federal income tax purposes of the redemption of a Non-U.S. Holder’s Public Shares as a sale or exchange under Section 302 of the Code or as a corporate distribution under Section 301 of the Code generally will correspond to the U.S. federal income tax characterization of such a redemption of a U.S. Holder’s Public Shares, as described above, and the corresponding consequences will be as described below.

Redemption Treated as Sale or Exchange

Any gain realized by a Non-U.S. Holder on the redemption of the Public Shares that is treated as a sale or exchange under Section 302 of the Code generally will not be subject to U.S. federal income tax unless:

·the gain is effectively connected with a trade or business of the Non-U.S. Holder in the United States (and, if required by an applicable income tax treaty, is attributable to a United States permanent establishment or fixed base of the Non-U.S. Holder); 

·the Non-U.S. Holder is an individual who is present in the United States for a period or periods aggregating 183 days or more in the taxable year of the disposition, and certain other conditions are met; or 

·we are or have been a “United States real property holding corporation” for U.S. federal income tax purposes at any time during the shorter of the five-year period ending on the date of disposition or the Non-U.S. Holder’s holding period for such Public Shares redeemed, and either (A) Public Shares are not considered to be regularly traded on an established securities market or (B) such Non-U.S. Holder has owned or is deemed to have owned, at any time during the shorter of the five-year period preceding such disposition and such Non-U.S. Holder’s holding period more than 5% of the outstanding FRLA Shares. There can be no assurance that shares of FRLA Shares will be treated as regularly traded on an established securities market for this purpose. 

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A non-corporate Non-U.S. Holder described in the first bullet point immediately above will be subject to tax on the net gain derived from the sale under regular graduated U.S. federal income tax rates. An individual Non-U.S. Holder described in the second bullet point immediately above will be subject to a flat 30% tax on the gain derived from the sale, which may be offset by certain United States source capital losses, even though the individual is not considered a resident of the United States, provided that the individual has timely filed U.S. federal income tax returns with respect to such losses. If a Non-U.S. Holder that is a corporation falls under the first bullet point immediately above, it will be subject to tax on its net gain in the same manner as if it were a United States person as defined under the Code and, in addition, may be subject to the branch profits tax equal to 30% (or such lower rate as may be specified by an applicable income tax treaty) of its effectively connected earnings and profits, subject to adjustments.

If the last bullet point immediately above applies to a Non-U.S. Holder, gain recognized by such Non-U.S. Holder on the redemption of Public Shares generally will be subject to tax at generally applicable U.S. federal income tax rates. In addition, we may be required to withhold U.S. income tax at a rate of 15% of the amount realized upon such redemption. We would generally be classified as a “U.S. real property holding corporation” if the fair market value of our “United States real property interests” equals or exceeds 50% of the sum of the fair market value of our worldwide real property interests and our other assets used or held for use in a trade or business, as determined for U.S. federal income tax purposes. However, we believe that we are not and have not been at any time since our formation a U.S. real property holding corporation and we do not expect to be a U.S. real property holding corporation immediately after the Business Combination is completed.

Redemption Treated as Corporate Distribution

With respect to any redemption treated as a corporate distribution under Section 301 of the Code, provided such dividends are not effectively connected with the Non-U.S. Holder’s conduct of a trade or business within the United States, FRLA will be required to withhold U.S. tax from the gross amount of the dividend at a rate of 30%, unless such Non-U.S. Holder is eligible for a reduced rate of withholding tax under an applicable income tax treaty and provides proper certification of its eligibility for such reduced rate (usually on an IRS Form W-8BEN or W-8BEN-E). Any distribution not constituting a dividend will be treated first as reducing (but not below zero) the Non-U.S. Holder’s adjusted tax basis in its FRLA Shares and, to the extent such distribution exceeds the Non-U.S. Holder’s adjusted tax basis, as gain realized from the sale or other disposition of the FRLA Shares, which will be treated as described above.

This withholding tax does not apply to dividends paid to a Non-U.S. Holder who provides a Form W-8ECI, certifying that the dividends are effectively connected with the Non-U.S. Holder’s conduct of a trade or business within the United States. Instead, the effectively connected dividends will be subject to regular U.S. income tax as if the Non-U.S. Holder were a U.S. resident, subject to an applicable income tax treaty providing otherwise. A Non-U.S. corporation receiving effectively connected dividends may also be subject to an additional “branch profits tax” imposed at a rate of 30% (or a lower treaty rate).

A new 1% U.S. federal excise tax is expected to be imposed on FRLA in connection with redemptions of FRLA Class A Common Stock

On August 16, 2022 the Inflation Reduction Act of 2022 (the “IR Act”) became law, which, among other things, imposes a 1% excise tax on the fair market value of certain repurchases (including certain redemptions) of stock by publicly traded domestic (i.e., U.S.) corporations and certain domestic subsidiaries of publicly traded foreign (i.e., non-U.S.) corporations. The excise tax will apply to stock repurchases occurring in 2023 and beyond. The amount of the excise tax is generally 1% of the fair market value of the shares of stock repurchased at the time of the repurchase. The U.S. Department of Treasury has been given authority to provide regulations and other guidance to carry out, and prevent the abuse or avoidance of, the excise tax; however, no guidance has been issued to date. While not free from doubt, absent such guidance, we currently expect that FRLA (whose securities are currently traded on the Nasdaq Capital Market) will be subject to the excise tax with respect to any redemptions of its FRLA Class A Common Stock in connection with the Business Combination that are treated as repurchases for this purpose. The

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extent of the excise tax that may be incurred would depend on a number of factors, including the fair market value of the FRLA Class A Common Stock redeemed, the extent such redemptions could be treated as dividends and not repurchases, and the content of any regulations and other guidance from the U.S. Department of the Treasury that may be issued and applicable to the redemptions. In addition, issuances of stock by a repurchasing corporation in a year in which such corporation repurchases stock may reduce the amount of excise tax imposed with respect to such repurchase. The excise tax is imposed on the repurchasing corporation itself, not the shareholders from which shares are repurchased and ultimately may cause the remaining shareholders to bear the economic impact of the excise tax. That said, the imposition of the excise tax could reduce the amount of cash available to FRLA for effecting the redemptions of FRLA Class A Common Stock such that the per-share redemption amount received by redeeming holders of FRLA Class A Common Stock may be less than $10.00 per share.

Tax Consequences of the Business Combination to U.S. Holders of WODI Common Stock

Subject to the qualifications and assumptions described in this proxy statement/prospectus/consent solicitation statement, the Merger will qualify as a “reorganization” within the meaning of Section 368(a) of the Code. Accordingly, WODI shareholders generally will not recognize gain or loss upon the exchange of their WODI Common Stock for FRLA Shares, except to the extent of cash received in lieu of a fractional share of Common Stock as described below. A U.S. holder who receives cash in lieu of a fractional share of Common Stock in the Merger will generally recognize capital gain or loss in an amount equal to the difference between the amount of cash received instead of a fractional share and the U.S. holder’s tax basis allocable to such fractional share. WODI shareholders generally will obtain a tax basis in the Common Stock they receive in the Merger equal to their tax basis in the WODI stock exchanged therefor, decreased by the amount of any tax basis allocable to a fractional share for which cash is received. The holding period of the Common Stock received by a WODI shareholder in the Merger will include the holding period of the shares of WODI stock surrendered in exchange therefor.

Neither FRLA nor WODI has requested, and neither intends to request, a ruling from the IRS as to the U.S. federal income tax consequences of the Merger. Consequently, no assurance can be given that the IRS will not assert, or that a court would not sustain, a position contrary to any of those set forth below. Accordingly, each holder of WODI stock is urged to consult its own tax advisor with respect to the particular tax consequence of the Merger to such holder. If the Merger is not treated as a “reorganization” within the meaning of Section 368(a) of the Code, then each U.S. holder of WODI stock generally will be treated as exchanging its WODI stock in a fully taxable transaction in exchange for Common Stock. WODI shareholders will generally recognize capital gain or loss in such exchange equal to the difference between such stockholder’s adjusted tax basis in the WODI stock surrendered in the Merger and the fair market value of the Common Stock received in exchange therefor. Any recognized capital gain or capital loss will be long-term capital gain or capital loss if the U.S. holder has held the shares of WODI stock for more than one year. The deductibility of capital losses is subject to limitations.

If a holder acquired different blocks of WODI stock at different times or different prices, it is urged to consult its tax advisor regarding the manner in which gain or loss should be determined in its specific circumstances, including the possible application of the installment sale rules.

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INFORMATION ABOUT FRLA

Overview

FRLA was incorporated in Delaware on February 1, 2021 and was formed for the purpose of entering into a merger, share exchange, asset acquisition, stock purchase, recapitalization, reorganization or other similar business combination with one or more businesses or entities. On November 5, 2021, FRLA closed its IPO. FRLA has until November 5, 2024 to consummate a business combination. If FRLA is unable to complete its initial business combination within such 36-month period, it will (i) cease all operations except for the purpose of winding up and (ii) as promptly as reasonably possible but not more than ten business days thereafter, redeem 100% of the outstanding Public Shares, at a per-P price, payable in cash, equal to the aggregate amount then on deposit in the Trust Account, including any interest not previously released to FRLA (net of taxes payable), divided by the number of then outstanding Public Shares, which redemption will completely extinguish public stockholders’ rights as holders of Public Shares (including the right to receive further liquidation distributions, if any), subject to applicable law. Public stockholders who redeem their Public Shares into their share of the Trust Account still have the right to continue to hold any Public Warrants they hold outside of such Public Unit; however, no fractional warrants will be issued upon separation of the Public Units and only whole warrants will trade. As promptly as reasonably possible following such redemption, subject to the approval of the remaining stockholders and the Board, FRLA will dissolve and liquidate, subject to its obligations under Delaware law to provide for claims of creditors and the requirements of other applicable law.

Trust Account

Following the closing of the IPO on November 5, 2021, including the underwriters’ partial exercise of over-allotment option, $99,705,000 from the net proceeds of the sale of the Public Units in the IPO and the sale of the Private Placement Shares was placed in a trust account maintained by Wilmington Trust, National Association, acting as trustee (the “Trust Account”). The funds held in the Trust Account were previously invested only in United States “government securities” within the meaning of Section 2(a)(16) of the Investment Company Act having a maturity of 185 days or less or in money market funds meeting certain conditions under Rule 2a-7 promulgated under the Investment Company Act which invest only in direct U.S. government treasury obligations, and are now held in cash, so that FRLA is not deemed to be an investment company under the Investment Company Act. Except with respect to interest earned on the funds held in the Trust Account that maybe released to FRLA to pay its income or other tax obligations, the proceeds will not be released from the Trust Account until the earlier of the completion of a Business Combination or the redemption of 100% of the outstanding Public Shares if FRLA has not completed a Business Combination in the required time period. The proceeds held in the Trust Account may be used as consideration to pay the sellers of a target business with which FRLA completes a Business Combination. Any amounts not paid as consideration to the sellers of the target business may be used to finance operations of the target business.

Business Combination Activities

On October 24, 2023, FRLA entered into the Business Combination Agreement. As a result of the transaction, WODI will become a wholly owned subsidiary of FRLA, and FRLA will change its name to “Water on Demand, Inc.” In the event that the Business Combination is not consummated by November 5, 2024, FRLA’s corporate existence will cease and we will distribute the proceeds held in the Trust Account to our public stockholders.

Selection of a Target Business and Structuring of the Business Combination

Under the Nasdaq rules, an initial business combination must occur with one or more target businesses that together have a fair market value of at least 80% of FRLA’s assets held in the Trust Account (excluding taxes payable on the income earned on the Trust Account count) at the time of the agreement to enter into the initial business combination. The fair market value of the target or targets will be determined by FRLA’s Board based upon one or more standards generally accepted by the financial community, such as discounted cash flow valuation or value of

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comparable businesses. Subject to this requirement, FRLA’s management has had virtually unrestricted flexibility in identifying and selecting one or more prospective target businesses, although FRLA was not permitted to effectuate an initial business combination with another blank check company or a similar company with nominal operations. In any case, FRLA determined that it would only complete an initial business combination in which we acquired 50% or more of the outstanding voting securities of the target or were otherwise not required to register as an investment company under the Investment Company Act.

Redemption Rights for Holders of Public Shares

Our stockholders (except the Initial Stockholders) will be entitled to redeem their Public Shares for a pro rata share of the Trust Account (currently anticipated to be no less than approximately $10.95 per Public Shares for stockholders) net of taxes payable. Public stockholders who redeem their Public Shares into their share of the Trust Account still have the right to continue to hold any Public Warrants they hold outside of such Unit; however, no fractional warrants will be issued upon separation of the Public Units and only whole warrants will trade. The Initial Stockholders and the Representative do not have redemption rights with respect to any Public Shares owned by them, directly or indirectly.

The redemption rights will include the requirement that a beneficial holder must identify itself in order to validly redeem its shares. As consideration for the receipt of Founder Shares and other covenants and commitments of FRLA made in connection with FRLA’s IPO, FRLA’s Sponsor and the Initial Stockholders have entered into a letter agreement with FRLA, pursuant to which they have agreed to waive their redemption rights with respect to any founder shares and any Public Shares held by them in connection with (i) the completion of FRLA’s initial business combination and (ii) a stockholder vote to approve an amendment to FRLA’s Current Charter that would affect the substance or timing of FRLA’s obligation to allow redemption in connection with FRLA’s initial business combination or to redeem 100% of FRLA’s public shares if FRLA has not completed an initial business combination within the period to consummate the initial business combination. There will be no redemption rights or liquidating distributions with respect to the Public Warrants, which will expire worthless if FRLA fails to complete FRLA’s initial business combination by November 5, 2024.

Submission of FRLA’s Business Combination to a Stockholder Vote

FRLA is providing its public stockholders with redemption rights upon consummation of the Business Combination. Public stockholders electing to exercise their redemption rights will be entitled to receive the cash amount specified above, provided that such stockholders follow the specific procedures for redemption set forth in this proxy statement/prospectus/consent/information statement relating to the stockholder vote on the Business Combination. Unlike many other blank check companies, FRLA’s public stockholders are not required to vote against the Business Combination in order to exercise their redemption rights. If the Business Combination is not completed, then public stockholders electing to exercise their redemption rights will not be entitled to receive such payments.

The Sponsor and Initial Stockholders have agreed to vote such common stock owned by them in favor of the Business Combination. In addition, as consideration for receipt of the Founder Shares and other covenants and commitments of FRLA in connection with FRLA’s IPO, the Sponsor and the Initial Stockholders have agreed to waive their redemption rights with respect to any capital shares they may hold in connection with the consummation of the Business Combination.

Limitation on Redemption Rights

Notwithstanding the foregoing, FRLA’s Current Charter provides that a public stockholder, together with any affiliate of such stockholder or any other person with whom such shareholder is acting in concert or as a “group” (as defined under Section 13 of the Exchange Act), will be restricted from seeking redemptions with respect to more than 15% of the shares sold in the IPO.

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Automatic Dissolution and Subsequent Liquidation of Trust Account if No Business Combination

If FRLA does not complete a business combination by November 5, 2024, it will trigger the automatic winding up, dissolution and liquidation pursuant to the terms of our Current Charter. As a result, this has the same effect as if FRLA had formally gone through a voluntary liquidation procedure under Delaware law. Accordingly, no vote would be required from FRLA’s stockholders to commence such a voluntary winding up, dissolution and liquidation. If FRLA is unable to consummate its initial business combination within such time period, it will, as promptly as possible but not more than ten business days thereafter, redeem 100% of FRLA’s outstanding Public Shares for a pro rata portion of the funds held in the Trust Account, including a pro rata portion of any interest earned on the funds held in the Trust Account and not necessary to pay its taxes, and then seek to liquidate and dissolve.

The proceeds deposited in the Trust Account could, however, become subject to claims of our creditors that are in preference to the claims of our public stockholders. Although FRLA will seek to have all vendors, service providers (excluding our independent registered public accounting firm), prospective target businesses and other entities with which we do business execute agreements with us waiving any right, title, interest or claim of any kind in or to any monies held in the Trust Account for the benefit of our public stockholders, there is no guarantee that they will execute such agreements or even if they execute such agreements that they would be prevented from bringing claims against the Trust Account including, but not limited to, fraudulent inducement, breach of fiduciary responsibility or other similar claims, as well as claims challenging the enforceability of the waiver, in each case in order to gain an advantage with respect to a claim against our assets, including the funds held in the Trust Account. If any third party refuses to execute an agreement waiving such claims to the monies held in the Trust Account, FRLA will perform an analysis of the alternatives available to it and will only enter into an agreement with a third-party that has not executed a waiver if management believes that such third-party’s engagement would be significantly more beneficial to us than any alternative. Examples of possible instances where we may engage a third party that refuses to execute a waiver include the engagement of a third-party consultant whose particular expertise or skills are believed by management to be significantly superior to those of other consultants that would agree to execute a waiver or in cases where management is unable to find a service provider willing to execute a waiver.

The Representatives have not executed agreements with us waiving such claims to the monies held in the Trust Account. In addition, there is no guarantee that entities will agree to waive any claims they may have in the future as a result of, or arising out of, any negotiations, contracts or agreements with us and will not seek recourse against the Trust Account for any reason. The Sponsor has agreed that it will be liable to ensure that the proceeds in the Trust Account are not reduced below $10.00 per Public Share by the claims of target businesses or claims of vendors or other entities that are owed money by FRLA for services rendered or contracted for or products sold to FRLA, but FRLA cannot assure that it will be able to satisfy its indemnification obligations if it is required to do so. FRLA has not asked the Sponsor to reserve for such indemnification obligations, nor has FRLA independently verified whether the Sponsor has sufficient funds to satisfy its indemnity obligations and believes that the Sponsor’s only assets are securities of FRLA. Therefore, FRLA believes it is unlikely that the Sponsor will be able to satisfy its indemnification obligations if it is required to do so.

In the event that the proceeds in the Trust Account are reduced below $10.00 per Public Share less taxes payable, and our Sponsor asserts that it is unable to satisfy its indemnification obligations or that it has no indemnification obligations related to a particular claim, our independent directors would determine whether to take legal action against our Sponsor to enforce its indemnification obligations. While FRLA currently expects that its independent directors would take legal action on its behalf against Sponsor to enforce its indemnification obligations to FRLA, it is possible that FRLA’s independent directors in exercising their business judgment may choose not to do so in any particular instance. Accordingly, FRLA cannot assure you that due to claims of creditors the actual value of the per-share redemption price will not be less than $10.00 per Public Share.

If FRLA files a bankruptcy petition or an involuntary bankruptcy petition is filed against it that is not dismissed, the proceeds held in the Trust Account could be subject to applicable bankruptcy law, and may be included in its bankruptcy estate and subject to the claims of third parties with priority over the claims of FRLA’s public stockholders. To the extent any bankruptcy claims deplete the Trust Account, FRLA cannot assure you it will be able

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to return $10.00 per Public Share to public stockholders. Additionally, if FRLA files a bankruptcy petition or an involuntary bankruptcy petition is filed against FRLA that is not dismissed, any distributions received by stockholders could be viewed under applicable debtor/creditor and/or bankruptcy laws as either a “preferential transfer” or a “fraudulent conveyance.” As a result, a bankruptcy court could seek to recover some or all amounts received by our public stockholders. Furthermore, the FRLA Board may be viewed as having breach edits fiduciary duty to our creditors and/or may have acted in bad faith, and thereby exposing itself and FRLA to claims of punitive damages, by paying public stockholders from the Trust Account prior to addressing the claims of creditors. FRLA cannot assure you that claims will not be brought against FRLA for these reasons.

Each of the Sponsor and the Representative has agreed to waive its rights to participate in any liquidation of the Trust Account or other assets with respect to the Private Placement Shares they hold.

Facilities

We maintain our principal executive offices at 13575 58th Street North, Suite 200, Clearwater, Florida 33760.

Legal Proceedings

To the knowledge of FRLA’s management, there are no legal proceedings pending against FRLA.

Employees

FRLA currently has one executive officer, Mr. Ryan Spick, who serves as FRLA’s Chief Financial Officer and Principal Executive Officer. Mr. Spick is not obligated to devote any specific number of hours to FRLA matters and intends to devote only as much time as he deems necessary to its affairs. FRLA does not intend to have any full-time employees prior to the consummation of a business combination.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF FRLA

The following discussion and analysis of the FRLA’s financial condition and results of operations should be read in conjunction with our audited financial statements and the notes related thereto which are included elsewhere in this proxy statement/prospectus/consent solicitation statement. Certain information contained in the discussion and analysis set forth below includes forward-looking statements. Our actual results may differ materially from those anticipated in these forward-looking statements as a result of many factors, including those set forth under “Cautionary Note Regarding Forward-Looking Statements.” The following discussion and analysis of our financial condition and results of operations should be read in conjunction with the financial statements and the notes thereto contained elsewhere in this report. Certain information contained in the discussion and analysis set forth below includes forward-looking statements that involve risks and uncertainties.

Overview

We are a blank check company formed as a Delaware corporation for the purpose of effecting a merger, capital stock exchange, asset acquisition, stock purchase, reorganization, or similar business combination with one or more businesses.

 

Effective December 22, 2022, Ka Wai Cheung, Koon Lin Chan, and Koon Keung Chan, our Sponsor, and WODI NV entered into a Membership Interest Purchase and Transfer Agreement pursuant to which they sold to WODI NV all right, title and interest in and to the membership interests held by each of Messrs. Cheung, Chan, and Chan in the Sponsor (an aggregate of 100 membership interests) for $400,000.

 

In addition, effective December 22, 2022, our Sponsor entered into a Securities Transfer Agreement with each of US Tiger Securities, Inc. (as designee of Lei Huang), Lei Xu, Yuanmei Ma, Norman C. Kristoff, David Xianglin Li, Michael Davidov, and Christy Szeto (the “Sellers”) pursuant to which the Sellers sold to the Sponsor an aggregate of 343,750 shares of FRLA Class B Common Stock for the purchase price of $3,506.25. Out of the issued and outstanding shares of FRLA Class B Common Stock, an aggregate of 100,000 shares remain owned by former management.

 

Lastly, on December 22, 2022, each of Koon Keung Chan, Lei Xu, and US Tiger Securities, Inc. assigned each of their promissory notes issued on November 4, 2022 in the aggregate amount of $733,750 to the Sponsor.

 

Since our inception, we have been actively searching for a suitable business combination target, and on October 24, 2023, we entered into the BCA, pursuant to which we have agreed to acquire all the outstanding securities of WODI based on certain material financial and business terms and conditions being met. We are not limited to a particular industry or geographic region for purposes of consummating an initial business combination except that we will not undertake our initial business combination with any entity with its principal business operations in China (including Hong Kong and Macau).

 

We will effectuate our business combination using cash (subject to potential reduction of the Trust Account by stockholder redemptions) derived from the proceeds of the IPO and the sale of the Private Placement Shares in a private placement (the “Private Placement”) to the Sponsor, additional shares, debt or a combination of cash, shares and debt.

 

We expect to continue to incur significant costs in the pursuit of our acquisition plans. We cannot assure you that our plans to complete a business combination will be successful. Our management has broad discretion with respect to the specific application of the proceeds of the IPO and the Private Placement that are held outside of the Trust Account, although substantially all the net proceeds are intended to be applied generally towards consummating a business combination and working capital.

 

Since our IPO, our sole business activity has been identifying and evaluating suitable acquisition transaction candidates. We presently have no revenue and have had losses since inception from incurring formation and operating

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costs. We have relied upon the sale of our securities and loans from the Sponsor and other parties to fund our operations.

 

Recent Developments

Extension of the FRLA’s Time to Consummate its Initial Business Combination

On November 4, 2022, an aggregate of $977,500 (the “First Extension Payment”) was deposited into our Trust Account for the public stockholders, representing $0.10 per public share, which enabled us to extend the period of time we had to consummate our initial business combination by three months from November 5, 2022 to February 5, 2023 (the “First Extension”). The First Extension was the first of the two three-month extensions permitted under our amended and restated certificate of incorporation prior to its amendment in April 2023. In connection with the First Extension Payment, we issued unsecured promissory notes (the “First Extension Notes”) to certain initial stockholders including (i) a note of $413,750 to Mr. Koon Keung Chan, the former manager of the Sponsor, (ii) a note of $150,000 to US Tiger Securities, and (iii) a note of $170,000 to Dr. Lei Xu, our former President and Chairwoman. The First Extension Notes were later assigned to our Sponsor on December 22, 2022.

 

On February 6, 2023, $977,500 (the “Second Extension Payment”) was deposited into the Trust Account, for the public stockholders, representing $0.10 per public share, which enabled us to extend the period of time we had to consummate our initial business combination by three months from February 5, 2023 to May 5, 2023 (the “Second Extension”). The Second Extension was the second and final of the two three-month extensions permitted under our amended and restated certificate of incorporation prior to its amendment in April 2023. In connection with the Second Extension Payment, we issued an unsecured promissory note (the “Second Extension Note”) to WODI.

 

On May 5, 2023, $330,064.50 (the “Third Extension Payment”) was deposited into the Trust Account, for the public stockholders, representing $0.0625 per public share, which enabled us to extend the period of time we had to consummate our initial business combination by one month from May 5, 2023 to June 5, 2023 (the “Third Extension”). The Third Extension was the first of the six one-month extensions permitted under our amended and restated certificate of incorporation after its amendment in April 2023. In connection with the Third Extension Payment, we issued an unsecured promissory note (the “Third Extension Note”) to WODI.

 

On June 5, 2023, $100,000 (the “Fourth Extension Payment”) was deposited into the Trust Account, for the public stockholders, representing $0.027 per public share, which enabled us to extend the period of time we had to consummate our initial business combination by one month from June 5, 2023 to July 5, 2023 (the “Fourth Extension”). The Fourth Extension was the second of the six one-month extensions permitted under our amended and restated certificate of incorporation after its amendment in April 2023. In connection with the Fourth Extension Payment, we issued an unsecured promissory note (the “Fourth Extension Note”) to WODI.

 

On July 5, 2023, $100,000 (the “Fifth Extension Payment”) was deposited into the Trust Account, for the public stockholders, representing $0.027 per public share, which enabled us to extend the period of time we had to consummate our initial business combination by one month from July 5, 2023 to August 5, 2023 (the “Fifth Extension”). The Fifth Extension was the third of the six one-month extensions permitted under our amended and restated certificate of incorporation after its amendment in April 2023. In connection with the Fifth Extension Payment, we issued an unsecured promissory note (the “Fifth Extension Note”) to WODI.

 

On August 4, 2023, $100,000 (the “Sixth Extension Payment”) was deposited into the Trust Account, for the public stockholders, representing $0.027 per public share, which enabled us to extend the period of time we have to consummate our initial business combination by one month from August 5, 2023 to September 5, 2023 (the “Sixth Extension”). The Sixth Extension was the fourth of the six one-month extensions permitted under our amended and restated certificate of incorporation after its amendment in April 2023. In connection with the Sixth Extension Payment, we issued an unsecured promissory note (the “Sixth Extension Note”) to WODI.

 

On September 5, 2023, $100,000 (the “Seventh Extension Payment”) was deposited into the Trust Account, for the public stockholders, representing $0.027 per public share, which enabled us to extend the period of time we have to

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consummate our initial business combination by one month from September 5, 2023 to October 5, 2023 (the “Seventh Extension”). The Seventh Extension was the fifth of the six one-month extensions permitted under our amended and restated certificate of incorporation after its amendment in April 2023. In connection with the Seventh Extension Payment, we issued an unsecured promissory note (the “Seventh Extension Note”) to WODI.

 

On October 5, 2023, $100,000 (the “Eighth Extension Payment”) was deposited into the Trust Account, for the public stockholders, representing $0.027 per public share, which enabled us to extend the period of time we have to consummate our initial business combination by one month from October 5, 2023 to November 5, 2023 (the “Eighth Extension”). The Eighth Extension was the sixth of the six one-month extensions permitted under our amended and restated certificate of incorporation after its amendment in April 2023. In connection with the Seventh Extension Payment, we issued an unsecured promissory note (the “Eighth Extension Note”) to WODI.

 

On November 6, 2023, $100,000 (the “Ninth Extension Payment”) was deposited into the Trust Account, for the public stockholders, representing $0.032 per public share, which enabled us to extend the period of time we have to consummate our initial business combination by one month from November 5, 2023 to December 5, 2023 (the “Ninth Extension”). The Ninth Extension was the first of the twelve one-month extensions permitted under our amended and restated certificate of incorporation after its amendment on October 25, 2023. In connection with the Ninth Extension Payment, we issued an unsecured promissory note (the “Ninth Extension Note”) to WODI.

 

On December 6, 2023, $100,000 (the “Tenth Extension Payment”) was deposited into the Trust Account, for the public stockholders, representing $0.032 per public share, which enabled us to extend the period of time we have to consummate our initial business combination by one month from December 5, 2023 to January 5, 2024 (the “Tenth Extension”). The Tenth Extension was the second of the twelve one-month extensions permitted under our amended and restated certificate of incorporation after its amendment on October 25, 2023. In connection with the Tenth Extension Payment, we issued an unsecured promissory note (the “Tenth Extension Note”) to WODI.

 

On January 5, 2024, $100,000 (the “Eleventh Extension Payment”) was deposited into the Trust Account, for the public stockholders, representing $0.032 per public share, which enabled us to extend the period of time we have to consummate our initial business combination by one month from January 5, 2023 to February 5, 2024 (the “Eleventh Extension”). The Eleventh Extension was the third of the twelve one-month extensions permitted under our amended and restated certificate of incorporation after its amendment on October 25, 2023. In connection with the Eleventh Extension Payment, we issued an unsecured promissory note (the “Eleventh Extension Note”) to WODI.

 

On February 5, 2024, $100,000 (the “Twelfth Extension Payment”) was deposited into the Trust Account, for the public stockholders, representing $0.032 per public share, which enabled us to extend the period of time we have to consummate our initial business combination by one month from February 5, 2024 to March 5, 2024 (the “Twelfth Extension”). The Twelfth Extension was the fourth of the twelve one-month extensions permitted under our amended and restated certificate of incorporation after its amendment on October 25, 2023. In connection with the Twelfth Extension Payment, we issued an unsecured promissory note (the “Twelfth Extension Note,” collectively with the First Extension Notes, the Second Extension Note, the Third Extension Note, the Fourth Extension Note, the Fifth Extension Note, the Sixth Extension Note, the Seventh Extension Note, the Eighth Extension Note, the Ninth Extension Note, the Tenth Extension Note and the Eleventh Extension Note herein referred to as the “Notes”) to WODI.

 

The Notes are non-interest bearing and payable (subject to the waiver against trust provisions) on the earlier of (i) consummation of our initial business combination and (ii) the date of our liquidation. The principal balance may be prepaid at any time, at our election. The holders of the Notes have the right, but not the obligation, to convert their Notes, in whole or in part, respectively, into private shares of our Class A Common Stock (the “Conversion Shares”), as described in our IPO prospectus (File Number 333-256511). The number of Conversion Shares to be received by the holders in connection with such conversion shall be an amount, up to $3,000,000, determined by dividing (x) the sum of the outstanding principal amount payable to such holders by (y) $10.00.

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Extension of Business Combination Deadline

On March 3, 2023, our board of directors approved a stockholder proposal to amend our amended and restated certificate of incorporation to extend, upon the request of our Sponsor and approval by our board of directors, the period of time for us to (i) consummate a business combination, (ii) cease our operations if we fail to complete such business combination, and (iii) redeem or repurchase 100% of the public shares, up to six times, each by an additional month, for an aggregate of six additional months (i.e. from May 5, 2023 to up to November 5, 2023) or such earlier date as determined by the board of directors.

 

On April 10, 2023, at a special meeting of stockholders, our stockholders approved the filing of an amendment to the Amended and Restated Certificate of Incorporation (the “Amendment”) to extend, upon the request of our Sponsor, and approval by our board of directors, the period of time for us to (i) consummate a business combination, (ii) cease our operations if we fail to complete such business combination, and (iii) redeem or repurchase 100% of the public shares, up to six times, each by an additional month, for an aggregate of six additional months (i.e. from May 5, 2023 to up to November 5, 2023) or such earlier date as determined by the board of directors. On April 11, 2023, we filed the Amendment with the Delaware Secretary of State. The stockholder vote to approve the Amendment also triggered a redemption right for the holders of the public shares of Class A Common Stock. As a result of the Amendment, 4,493,968 shares of Class A Common Stock were redeemed for a total redemption amount of $47,501,242.

 

As a result of the June 2, 2023 special meeting of stockholders of the Company, the Company filed with the Secretary of State of the State of Delaware an amendment to the Company’s amended and restated certificate of incorporation to amend the monthly extension amounts to be paid by the Sponsor (or its affiliates), to extend the period of time for the Company to consummate a merger, capital stock exchange, asset acquisition, stock purchase, reorganization or similar business combination involving the Company to be made upon the request of the Sponsor, and approval by the Company’s board of directors, from an amended price per unredeemed share of Class A Common Stock of $0.0625 to the lower of $100,000 or $0.05 per unredeemed share of Class A Common Stock.

 

On June 2, 2023, at a special meeting of stockholders, the holders of 1,666,080 public shares properly exercised their right to redeem their shares (and did not withdraw their redemption) for cash at a redemption price of approximately $10.76 per share, for an aggregate redemption amount of approximately $17,927,021. Following such redemptions, 3,614,952 public shares of Class A Common Stock remain outstanding.

 

On October 25, 2023, at a special meeting of stockholders, in connection with the votes to approve the extension of the Business Combination period for an additional twelve months, from November 5, 2023 to up to November 5, 2024, the holders of 452,404 public shares properly exercised their right to redeem their shares (and did not withdraw their redemption) for cash at a redemption price of approximately $10.96 per share, for an aggregate redemption amount of approximately $5.0 million. Following such redemptions, 3,162,548 public shares of Class A Common Stock remain outstanding.

 

Business Combination Agreement

On October 24, 2023, we entered into the BCA with Merger Sub and WODI.

 

The BCA provides, among other things, that Merger Sub will merge with and into WODI, with WODI as the surviving company in the merger and, after giving effect to such merger, WODI shall be a wholly-owned subsidiary of us (the “Merger”). We will change our name to “Water on Demand, Inc.” The Merger and the other transactions contemplated by the BCA are hereinafter referred to as the “Business Combination.” In accordance with the terms and subject to the conditions of the BCA, at the effective time of the Merger (the “Effective Time”), among other things: (i) each share of FRLA Class A Common Stock and each share of FRLA Class B Common Stock (except for FRLA Class B Common Stock held by the Sponsor which are subject to forfeiture pursuant to the Sponsor Letter Agreement) that is issued and outstanding immediately prior to the Merger will become one share of our common stock, par value $0.0001 per share, and (ii) each share of common stock of WODI (subject to limited exceptions) issued and outstanding as of immediately prior to the Effective Time shall be automatically canceled and extinguished and converted into the right to receive that number of shares of our common stock equal to an exchange ratio, calculated

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as (a) the aggregate equity value of WODI of $32.0 million, divided by the aggregate number of shares of WODI common stock outstanding immediately prior to the Effective Time, divided by (b) the FRLA Share Value, where “FRLA Share Value” means (i) the aggregate amount of cash on deposit in the Trust Account (without giving effect to stockholder redemptions) as of two business days prior to the closing date of the Merger, including interest not previously released to us to pay our taxes divided by (ii) the total number of then issued and outstanding shares of FRLA Class A Common Stock (without giving effect to stockholder redemptions).

 

Results of Operations

Our entire activity from inception to date was related to our formation, the IPO and general and administrative activities. Since the IPO, our activity has been limited to the evaluation of business combination candidates, and we will generate any operating revenues, if any, until the closing and completion of our initial business combination. We have generated non-operating income in the form of money market fund dividend income earned on investments held in the Trust Account. We are incurring expenses as a result of being a public company (for legal, financial reporting, accounting and auditing compliance), as well as for due diligence expenses.

 

For the three months ended September 30, 2023, we had a net income of $40,383 which consisted of dividend income earned on investments held in Trust Account of $487,742, offset by formation and operating costs of $393,380, franchise tax expenses of $38,000 and income tax provision of $15,979.

 

For the three months ended September 30, 2022, we had a net income of $176,285, which consisted of dividend earned on investment held in Trust Account of $450,819 and offset by formation and operating costs $225,934 and franchise tax expenses of $48,600.

 

For the nine months ended September 30, 2023, we had a net income of $391,662 which consisted of dividend earned on investment held in Trust Account of $2,342,684, offset by formation and operating costs of $1,353,037, franchise tax expenses of $110,400 and income tax provision of $487,585.

 

For the nine months ended September 30, 2022, we had a net loss of $276,541, which consisted of formation and operating costs $731,906 and franchise tax expenses of $145,200 and offset by dividend earned on investment held in Trust Account of $600,565.

 

For the year ended December 31, 2022, we had a net loss of $47,609, which consisted of formation and operating costs of $959,457, franchise tax expenses of $199,759 and income tax provision of $355,070, offset by dividend earned on investment held in Trust Account of $1,466,677.

 

For the period from February 1, 2021 (inception) through December 31, 2021, we had net loss of $132,164, which  consisted of $97,513 of operating costs and $35,961 franchise tax expenses, offset by $1,310 of dividend income earned on investments held in the Trust Account.

 

Liquidity and Capital Resources

As of September 30, 2023, we had cash outside the Trust Account of $111,745 available for working capital needs. All remaining cash is held in the Trust Account and is generally unavailable for our use prior to an initial business combination, and is restricted for use either in a business combination or to redeem the Public Shares. As of September 30, 2023, none of the amount on deposit in the Trust Account was available to be withdrawn as described above except for tax payments.

 

For the nine months ended September 30, 2023, there was $2,592,619 of cash used in operating activities resulting from dividend earned on investment held in Trust Account amounting to $2,342,684, non-cash deferred tax expense of $83,724, increase in prepaid expenses of $188,772, decrease in income tax payable of $271,346 and decrease in franchise tax payable of $199,759, offset by net income of $391,662, decrease in prepaid expenses – related party of $25,000, increase in due to a related party of $15,000, and increase in accounts payable and accrued expenses of $62,004.

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For the nine months ended September 30, 2022, there was $616,202 of cash used in operating activities resulting from net loss of $276,541 and dividend earned on investment held in Trust Account amounting to $600,565, offset by decrease in prepaid expenses of $149,852, increase in accounts payable and accrued expenses of $1,813, and increase in franchise taxes payable of $109,239.

 

For the nine months ended September 30, 2023, there was $64,749,327 of cash provided by investing activities resulting from the withdrawal of an investment held in the Trust Account amounting to $66,456,892, offset by the purchase of an investment held in Trust Account amounting to $1,707,565.

 

For the nine months ended September 30, 2022, there were no cash investing activities.

 

For the nine months ended September 30, 2023, there was $62,217,277 of cash used in financing activities resulting from the Public Share redemptions of $65,428,262, offset by the proceeds from the issuance of promissory notes to a related party amounting to $3,210,985.

 

For the nine months ended September 30, 2022, there were no cash financing activities.

 

For year ended December 31, 2022, cash used in operating activities was $689,068. As of December 31, 2022, we had cash outside the Trust Account of $172,314 available for working capital needs. As of December 31, 2022, none of the amount on deposit in the Trust Account was available to be withdrawn as described above except for tax payments.

 

Until consummation of the business combination, we will use the funds held outside the Trust Account, and any additional funding that may be loaned to us by our Sponsor, for identifying and evaluating prospective acquisition candidates, performing business due diligence on prospective target businesses, traveling to and from the offices, plants or similar locations of prospective target businesses, reviewing corporate documents and material agreements of prospective target businesses, selecting the target business to acquire and structuring, negotiating and consummating the business combination.

 

If our estimates of the costs of undertaking in-depth due diligence and negotiating a business combination are less than the actual amount necessary to do so, we may have insufficient funds available to operate our business prior to the business combination and will need to raise additional capital. In this event, our officers, directors or their affiliates may, but are not obligated to, loan us funds as may be required. If we consummate an initial business combination, we would repay such loaned amounts out of the proceeds of the Trust Account released to us upon consummation of the business combination, or, at the lender’s discretion, up to $3,000,000 of such loans may be convertible into shares of Common Stock of the post business combination entity at a price of $10.00 per share. In the event that the initial business combination does not close, we may use a portion of the working capital held outside the Trust Account to repay such loaned amounts, but no proceeds from our Trust Account would be used for such repayment. The terms of such loans by our initial stockholders, officers and directors, if any, have not been determined and no written agreements exist with respect to such loans.

 

Moreover, we may need to obtain additional financing either to consummate our initial business combination or because we become obligated to redeem a significant number of our public shares upon consummation of our initial business combination, in which case we may issue additional securities or incur debt in connection with such business combination. Subject to compliance with applicable securities laws, we would only consummate such financing simultaneously with the consummation of our initial business combination. Following our initial business combination, if cash on hand is insufficient, we may need to obtain additional financing in order to meet our obligations.

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In connection with our assessment of going concern considerations in accordance with Financial Accounting Standard Board’s Accounting Standards Update (ASU) 2014-15, “Disclosures of Uncertainties about an Entity’s Ability to Continue as a Going Concern,” management has determined that these conditions raise substantial doubt about our ability to continue as a going concern. Management’s plan in addressing this uncertainty is through the promissory notes – related parties and the Working Capital Loans. In addition, if we are unable to complete a business combination within the Combination Period by March 5, 2024 (or up to November 5, 2024, if the Company extends the time to complete a Business Combination), our board of directors would proceed to commence a voluntary liquidation and thereby a formal dissolution of the Company. There is no assurance that our plans to consummate a business combination will be successful within the Combination Period. As a result, management has determined that this additional condition also raises substantial doubt about our ability to continue as a going concern. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

 

Off-Balance Sheet Financing Arrangements

We have no obligations, assets or liabilities that would be considered off-balance sheet arrangements as of September 30, 2023 and December 31, 2022. We do not participate in transactions that create relationships with unconsolidated entities or financial partnerships, often referred to as variable interest entities, which would have been established for the purpose of facilitating off-balance sheet arrangements. We have not entered into any off-balance sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or purchased any non-financial assets.

 

Contractual Obligations

As of September 30, 2023 and December 31, 2022, we do not have any long-term debt, capital lease obligations, operating lease obligations or long-term liabilities. As of September 30, 2023 and December 31, 2022, we have $15,000 and $50,000, respectively, payable due to a related party. As of September 30, 2023 and December 31, 2022, we have $3,994,735 and $733,750, respectively, promissory notes issued to related parties.

 

We are obligated to pay the underwriters a deferred underwriters’ discount equal to 3.5% of the gross proceeds of the IPO. The deferred underwriters’ discount of $3,421,250 will become payable to the US Tiger Securities and EF Hutton, a division of Benchmark Investment LLC, the representatives of the several underwriters of the IPO (each, a “Representative”), from the amounts held in the Trust Account solely in the event that we complete a business combination.

 

Critical Accounting Policies and Estimates

Use of Estimates

The preparation of financial statements in conformity with U.S. GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of expenses during the reporting period. Actual results could differ from those estimates.

 

Warrants

We account for warrants as either equity-classified or liability-classified instruments based on an assessment of the warrant’s specific terms and applicable authoritative guidance in Financial Accounting Standards Board (“FASB”) ASC 480 “Distinguishing Liabilities from Equity” (“ASC 480”) and ASC 815, Derivatives and Hedging (“ASC 815”). The assessment considers whether the warrants are freestanding financial instruments pursuant to ASC 480, whether they meet the definition of a liability pursuant to ASC 480, and whether the warrants meet all of the requirements for equity classification under ASC 815, including whether the warrants are indexed to our own Common Stock and whether the warrant holders could potentially require “net cash settlement” in a circumstance outside of our control, among other conditions for equity classification. This assessment, which requires the use of professional judgment, is

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conducted at the time of warrant issuance and as of each subsequent quarterly period end date while the warrants are outstanding.

 

For issued or modified warrants that meet all of the criteria for equity classification, the warrants are required to be recorded as a component of equity at the time of issuance. For issued or modified warrants that do not meet all the criteria for equity classification, the warrants are required to be recorded as liabilities at their initial fair value on the date of issuance, and each balance sheet date thereafter. Changes in the estimated fair value of the warrants are recognized as a non-cash gain or loss on the statements of operations.

 

The Company accounted for the 4,887,500 Public Warrants issued with the Initial Public Offering as equity instruments in accordance with ASC 480, “Distinguishing Liabilities from Equity” and ASC 815-40, “Derivatives and Hedging: Contracts in Entity’s Own Equity”.

 

Class A Common Stock Subject to Possible Redemption

We account for our Class A Common Stock, $0.0001 par value per share (the “Class A Common Stock”), subject to possible redemption in accordance with the guidance in ASC Topic 480 “Distinguishing Liabilities from Equity.” Common Stock subject to mandatory redemption (if any) is classified as a liability instrument and is measured at fair value. Conditionally redeemable Class A Common Stock (including Class A Common Stock that features redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within our control) is classified as temporary equity. At all other times, Class A Common Stock is classified as stockholders’ equity. Our public shares feature certain redemption rights that are considered to be outside of our control and subject to occurrence of uncertain future events. Accordingly, as of September 30, 2023 and December 31, 2022, shares of Class A Common Stock subject to possible redemption are presented at redemption value of $10.95 and $10.39, respectively, per share as temporary equity, outside of the stockholders’ deficit section of our unaudited condensed balance sheets. We recognize changes in redemption value immediately as they occur and adjust the carrying value of redeemable Class A Common Stock to equal the redemption value at the end of each reporting period. Increases or decreases in the carrying value of shares of redeemable Class A Common Stock are affected by charges against additional paid in capital or accumulated deficit if additional paid in capital equals to zero.

 

Fair Value of Financial Instruments

ASC Topic 820 “Fair Value Measurements and Disclosures” defines fair value, the methods used to measure fair value and the expanded disclosures about fair value measurements. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between the buyer and the seller at the measurement date. In determining fair value, the valuation techniques consistent with the market approach, income approach and cost approach shall be used to measure fair value. ASC Topic 820 establishes a fair value hierarchy for inputs, which represent the assumptions used by the buyer and seller in pricing the asset or liability. These inputs are further defined as observable and unobservable inputs. Observable inputs are those that buyer and seller would use in pricing the asset or liability based on market data obtained from sources independent of us. Unobservable inputs reflect our assumptions about the inputs that the buyer and seller would use in pricing the asset or liability developed based on the best information available in the circumstances.

 

The fair value hierarchy is categorized into three levels based on the inputs as follows:

 

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Level 1 – Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that we have the ability to access. Valuation adjustments and block discounts are not being applied. Since valuations are based on quoted prices that are readily and regularly available in an active market, valuation of these securities does not entail a significant degree of judgment.

 

·

Level 2 – Valuations based on (i) quoted prices in active markets for similar assets and liabilities, (ii) quoted prices in markets that are not active for identical or similar assets, (iii) inputs other than quoted prices for the assets or liabilities, or (iv) inputs that are derived principally from or corroborated by market through correlation or other means.

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·

Level 3 – Valuations based on inputs that are unobservable and significant to the overall fair value measurement.

 

The fair value of our assets and liabilities, which qualify as financial instruments under ASC Topic 820, “Fair Value Measurements and Disclosures,” approximates the carrying amounts represented in the accompanying balance sheets, primarily due to their short-term nature.

 

Income Taxes

We account for income taxes under ASC 740 Income Taxes (“ASC 740”). ASC 740 requires the recognition of deferred tax assets and liabilities for both the expected impact of differences between the financial statement and tax basis of assets and liabilities and for the expected future tax benefit to be derived from tax loss and tax credit carry forwards. ASC 740 additionally requires a valuation allowance to be established when it is more likely than not that all or a portion of deferred tax assets will not be realized.

 

ASC 740 also clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements and prescribes a recognition threshold and measurement process for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities. ASC 740 also provides guidance on derecognition, classification, interest and penalties, accounting in interim period, disclosure and transition.

 

We recognize accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of September 30, 2023, December 31, 2022 and 2021. We are currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position.

 

We have identified the United States as its only “major” tax jurisdiction.

 

We may be subject to potential examination by federal and state taxing authorities in the areas of income taxes. These potential examinations may include questioning the timing and amount of deductions, the nexus of income among various tax jurisdictions and compliance with federal and state tax laws. Our management does not expect that the total amount of unrecognized tax benefits will materially change over the next twelve months.

 

Net Income (Loss) per Share

We comply with accounting and disclosure requirements of FASB ASC 260, Earnings Per Share. In order to determine the net income (loss) attributable to both the redeemable shares and non-redeemable shares, we first considered the undistributed income (loss) allocable to both the redeemable Common Stock and non-redeemable Common Stock and the undistributed income (loss) is calculated using the total net loss less any dividends paid. We then allocated the undistributed income (loss) ratably based on the weighted average number of shares outstanding between the redeemable and non-redeemable Common Stock. Any remeasurement of the accretion to redemption value of the Common Stock subject to possible redemption was considered to be dividends paid to the public stockholders.

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Recent Accounting Pronouncements

In August 2020, the FASB issued ASU 2020-06, “Debt – Debt Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40).” The amendment in this ASU is to address issues identified as a result of the complexity associated with applying generally accepted accounting principles (GAAP) for certain financial instruments with characteristics of liabilities and equity. For convertible instruments, the Board decided to reduce the number of accounting models for convertible debt instruments and convertible preferred stock per this ASU. Limiting the accounting models results in fewer embedded conversion features being separately recognized from the host contract as compared with prior GAAP. Convertible instruments that continue to be subject to separation models are (1) those with embedded conversion features that are not clearly and closely related to the host contract, that meet the definition of a derivative, and that do not qualify for a scope exception from derivative accounting and (2) convertible debt instruments issued with substantial premiums for which the premiums are recorded as paid-in capital. The amendments in this ASU are effective for public business entities that meet the definition of a Securities and Exchange Commission (SEC) filer, excluding entities eligible to be smaller reporting companies as defined by the SEC, for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. The Board specified that an entity should adopt the guidance as of the beginning of its annual fiscal year. We have not early adopted the ASU and it will become effective for us on January 1, 2024 as we are an emerging growth company. We believe the adoption of this ASU would not have a material effect on our financial statements.

 

Management does not believe that any recently issued, but not effective, accounting standards, if currently adopted, would have a material effect on our financial statements.

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INFORMATION ABOUT WODI

Overview

WODI (formerly Progressive Water Treatment, Inc.) is a subsidiary of OriginClear, Inc. (“OCLN”) and includes recently acquired operating companies Water on Demand, Inc., a Nevada corporation (“WODI NV”), and Modular Water Systems, Inc., a Nevada corporation (“MWS”).

Water on Demand, Inc.

In October 2015, OCLN acquired WODI (then known as Progressive Water Treatment, Inc.), an established designer and manufacturer of a complete line of water treatment systems for municipal, industrial and pure water applications. OCLN’s acquisition of WODI marked the beginning of a series of acquisitions of leading U.S. water services companies focused on specialized water treatment with the vision of creating an end-to-end water treatment offering to serve the growing demand for outsourced water. In 2015, WODI had already established robust design and manufacturing offerings as well as maintenance and service offerings. With respect to design and manufacturing, WODI utilized a broad range of technologies including chemical injection, media filters, membrane, ion exchange and SCADA (supervisory control and data acquisition) technology in turnkey systems. WODI’s service component includes a range of services such as maintenance contracts, retrofits and replacement assistance as well as equipment rental. WODI primarily serves customers in the United States and Canada, but offers a global reach with customers in Japan, Argentina and the Middle East.

Modular Water Systems, Inc.

In 2018, OCLN launched, and WODI subsequently acquired, MWS, a leader in onsite, pre-fabricated wastewater treatment systems made with sophisticated materials that can last decades. MWS offers modular wastewater treatment products designed for commercial development, RV parks and campgrounds, residential development, schools and institutions, hotels and resorts and various other applications. MWS’s modular water treatment systems are factory assembled before shipment and on-site installation. MWS’s pre-fabrication strategy significantly simplifies and expedites final installation.

MWS’s modular systems utilize the latest advancements in wastewater technology including fixed film biological treatment, membrane bioreactor filtration and real-time remote monitoring and control systems. MWS systems utilize high quality Structurally Reinforced ThermoPlastics (SRTP), which offers significant advantages over other treatment systems, including longevity and transportability.

Water on Demand NV

In 2023, OCLN launched WODI NV to offer private businesses the opportunity to outsource and finance water treatment and purification services on a per-gallon basis while gaining independence from traditional, centralized private water infrastructure. WODI NV’s value proposition is that by outsourcing water treatment and purification, private businesses can gain the water security of a private, decentralized infrastructure while avoiding the capital, technological and administrative burden required to design, finance, build, operate and maintain a water treatment solution. WODI NV uses a Design-Build-Own-Operate model for its pay-as-you-go water solutions for private businesses.

Combined Companies

As of September 2023, WODI, MWS and WODI NV have been consolidated under WODI with OCLN being the largest single shareholder of the combined companies. The combined companies have complementary offerings that create meaningful synergies with the goal of allowing WODI to emerge as a leader in offering end-to-end outsourced water treatment services.

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Industry Background

Traditional Water Treatment Practices

Public water utilities are responsible for both the collection and treatment of water for residential, medical and industrial use as well as the processing and treatment of wastewater. Water supply and treatment across much of the globe is handled on a municipal level at large treatment centers. Economies of scale have incentivized the development of larger and larger facilities which centralize the supply and treatment of water to increasingly larger populations. Of the 16,000 publicly owned wastewater treatment systems in the United States, the top 10% of treatment plants process over 80% of the total wastewater and more than half of the total wastewater treated is processed by just 1.35% of the total plants.

Wastewater treatment plants process wastewater from residential and commercial sources as well as ground runoff, which is delivered to the plant through a network of local and regional storm drains and sewer lines. Upon arrival at the plant, wastewater is typically processed in three phases: preliminary treatment, primary treatment and secondary treatment. In the preliminary treatment phase, mud and sand settle in a tank called a grit chamber, which is later disposed of in landfills for environmentally safe disposal. During the primary treatment, sewage flows into settling tanks, where up to 60% of the solids in the waste stream settle out as a mixture of sludge and water. While the primary treatment removes a majority of the solid waste from the sewage, it removes very few toxic chemicals. In the secondary treatment, oxygen is added to the wastewater in a process called aeration. Aeration accelerates the growth of microorganisms which regenerate quickly, reduce the production of hydrogen sulfide and methane gas, consume the wastes and settle to the bottom of the secondary settling tanks. After the secondary treatment, 80-90% of human waste and other solids and a significant proportion of toxic chemicals have been removed from the wastewater.

During the final phase of the secondary treatment, water is usually disinfected with chlorine, which kills more than 99% of harmful bacteria remaining in the water. Before discharging the treated water into the environment, the water is dechlorinated. As an alternative to chlorination and dichlorination, some facilities remove bacteria using ultraviolet light, carbon absorption, distillation and reverse osmosis.

Sludge from the primary and secondary treatment is processed further in sludge digesters which mix and heat the solids to reduce their volume and kill disease-causing bacteria. The processed solids are then typically processed by pelletizing plants, where they are heat-dried and converted to pellet fertilizer for use in agriculture, forestry and land reclamation.

This three-phase process is the standard for wastewater treatment around the globe. Given the industrial nature of the process and ability to reduce costs through economies of scale, treatment facilities are constructed on a massive scale with large facilities capable of processing over 1 billion gallons of water per day and construction costs in the billions of dollars.

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Infrastructure – Maintenance and Investment

In spite of the historical construction of large treatment facilities, U.S. investment in water infrastructure has lagged behind demand. Of the approximately 16,000 wastewater treatment plants (WWTPs) in the United States, 81% are functioning at their design capacity while 15% have reached or exceeded design capacity, according to the American Society of Civil Engineers. While large scale capital improvements have been made to systems experiencing sanitary sewer overflows, expansion efforts have slowed in recent years. Many facilities are also reaching the end of their life spans and are in need of increased maintenance and renovation.

The majority of WWTPs are designed with an average lifespan of 40 to 50 years, so systems that were constructed in the 1970s, around the passing of the Clean Water Act of 1972, are reaching the end of their service lives. Nationwide, drinking water and wastewater pipes in the ground are on average 45 years old, while some systems have pipes more than a century old. The typical expected lifespan for wastewater pipes is 50 to 100 years. As collection systems age and decline in condition, groundwater and stormwater enters the networks through cracks and joints, leading to overflows. Aging systems require increased capital investments which, at the municipal level increased nationally from $20 billion in 1993 to $55 billion in 2017. In 2019, the American Society of Civil Engineers estimated an $81 billion deficit in required water infrastructure investment, which is expected to grow to $434 billion by 2029 if left unaddressed.

Despite efforts at the municipal level to maintain water rates at affordable levels, water fee rates have continued to trend upward to reflect the true cost of water treatment. Between 2008 and 2016, water fee rates increased on average by 24% and since 2000, water and sewage fee rates have increased by nearly 200%, outpacing nearly all other Consumer Price Index components.

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Aging systems further increase costs as efficiency declines. On average, 14-18% of total daily treated potable water in the United States is lost through leaks. Decreases in federal spending also exacerbate the cost burden on state and local governments, and, in turn, users, as the federal government’s contribution to water infrastructure spending has fallen from 64% of total national capital spending in 1977 to just 9% of total capital spending in 2014, according to the Congressional Budget Office.

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Federal Spending on Transportation and Water Infrastructure, 1956 to 2017

 

Regulatory requirements for utilities continue to increase due to rising enforcement of long-standing requirements and the creation of new requirements. In February 2021, the EPA announced two actions to address levels of polyfluoroalkyl substances (PFAS), human-made chemicals used through industry and consumer products, in drinking water. In December 2020, the EPA finalized its revised Lead and Copper rule, compliance with which the American Society of Civil Engineers estimates will cost between $130 million and $286 million.

Privatization and Decentralization

As water utilities struggle to manage the increased costs of maintenance and operations with decreased federal support, few observers believe that significant ongoing rate increases are a viable option. According to McKinsey & Company, even before the COVID-19 pandemic, 20% of U.S. households in 2019 were paying more than 4.5 % of their household income on water bills—a level that is considered unaffordable. This figure rose to 24% in the first seven months of 2021. In 2020, 60% of utilities surveyed said they experienced or anticipated negative financial impacts during the pandemic due to revenue loss, water-shutoff moratorium policies and forgiveness of nonpayment of bills. Despite these challenges, utilities did not expect to implement rate increases until 2022.

The Drinking Water and Wastewater Infrastructure Act of 2021, which included $55 billion in funding, demonstrated some awareness by the federal government of the challenges to funding and maintaining water infrastructure, however, even large increases in federal funding cannot fully cover the needed investment. In November 2023, the Environmental Protection Agency (EPA) proposed amendments to the Lead and Copper Rule (LCR), which was established in 1991 and intended to regulate the control and monitoring of lead in drinking water. The proposed new rule requires water systems to replace all lead pipelines within 10 years (and faster when feasible), lowers the levels at which agencies must take additional steps to eliminate lead in drinking water, and contains provisions intended to improve accuracy in identifying where higher levels of lead in drinking water are within communities. Even a five-fold increase in federal funding would leave a 22% shortfall in the capital necessary to serve

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the growing need for water infrastructure. In response, investor and private-sector interest in water and wastewater services has increased and M&A transactions in the water sector have increased annually from 2012 to 2017.

Given increased utility prices and increased concerns surrounding the maintenance and operations of WWTPs and utilities, businesses are increasingly choosing to treat and purify their own water, in a trend known as Decentralized Water. Decentralized wastewater treatment consists of a variety of approaches for collection, treatment and dispersal/reuse of wastewater for individual dwellings, industrial or institutional facilities, clusters of homes or businesses, and entire communities. Decentralized water systems offer several advantages including the ability to tailor facilities to meet the cost and quality requirements of specific uses (i.e., medical vs. residential vs. industrial), flexibility in adapting to demographic shifts, reduced operating and maintenance costs, avoiding large capital costs, relative speed and ease of installation and ability to serve rural, suburban and urban settings.

Water Usage

While traditional water supply and treatment face particular challenges related to aging infrastructure, significant capital costs and shortfalls in funding, global water supply challenges are putting stress on the supply side of the water equation. Supply side risks, including climate change, migration, industrial reshoring, government regulation and industrial centralization, increase the need to rethink traditional water systems and supplement established programs.

Climate Change. Freshwater scarcity occurs when the demand for fresh water in an area exceeds the total available amount. Record-breaking heat waves and droughts have increasingly brought freshwater scarcity to the forefront of public policy and the national consciousness as a changing climate changes precipitation patterns across the United States. The combination of diminishing precipitation and rising demand has caused U.S. aquifer levels to decline more quickly than can naturally be replenished. As weather patterns become increasingly difficult to predict and precipitation becomes increasingly concentrated and more difficult to capture for productive use, the global supply of natural fresh water grows increasingly constrained.

Migration. Prior to the COVID-19 pandemic, domestic migration trends illustrated increasing populations in urban areas, however, following the pandemic these trends reversed. Regardless of whether migration trends away from urban centers continue, social, economic and environmental factors make it increasingly difficult to predict demographic trends and shifts in populations. Large WWTPs require decades for planning, financing and construction and decreasing confidence in planners’ ability to predict domestic migration trends counts in favor of decentralized water systems, which require significantly smaller capital investments and can be brought into use in a fraction of the time.

 

Reshoring of Manufacturing. While agricultural use continues to constitute the majority of water consumption, demand in the manufacturing sector has seen the largest increases in demand with increasing demand projected for the future. This pattern becomes particularly important in the context of increasing re-shoring as supply chains are reconfigured in response to the COVID-19 pandemic, the war in Ukraine, and shifting global economies. American political ambitions have also reinforced and promoted an increase in manufacturing as two successive presidents from opposing political parties have prioritized the development and increase of domestic manufacturing. As the manufacturing industry continues to use water resources more intensively and as domestic manufacturing continues to grow, these forces combine to increase demands on U.S. water supply.

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Regulatory and Public Funding Risk. As freshwater resources come under increasing stress, policymakers are increasingly challenging established water policies. The St. Louis Federal Reserve has expressed growing concern for the allocation of water resources and has called for “more optimal mechanisms for allocating water.” In November 2021, the U.S. Supreme Court ruled on claims between the State of Tennessee and the State of Mississippi regarding the apportionment of interstate groundwater. In the western United States, growing concerns regarding decreased supply and growing demand for water in the Colorado Basin have produced tensions and limited collaboration between seven western states. Disputes between states, municipalities and cities over water use and development are growing increasingly common and are yet another factor in the growing number of supply risks for water.

 

Industrial Centralization Risk. In an increasingly security conscious world, the centralization of water treatment substantially increases the risks of a single failure whether caused by natural disaster, financial factors or other security threats. Centralizing and concentrating water infrastructure creates a system with millions of individuals and businesses downstream from single failure points. Decentralizing water supply and treatment disperses risk and provides individuals and industry greater control over a critical resource.

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WODI’s Business

WODI provides financings for water development projects. The Water On Demand initiative enables businesses and communities to finance water projects by paying only for the water they use without the high cost of upfront capital expenditures.  End-users simply sign a long-term service contract, with regional water companies providing expert support. Innovative OriginClear modular systems are licensed to builders to standardize the fleet, leaving zero “new technology” risk as only proven technologies, systems, and methods are implemented.

According to a 2021 study by scientists at Utrecht University and United Nations University about half of global wastewater is released untreated into rivers, streams and aquifers. In addition, only 11% of the wastewater produced globally is currently being reused. Increasing this percentage is essential, because by 2025, two-thirds of the world’s population may face water shortages, according to the World Wildlife Fund. Compounding the problem in North America’s supply system, an estimated 20 to 50 percent of water is lost to leaks – a major issue as utilities contend with how to sustain a growing population in an era of water scarcity, according to a study published by Stanford University.  Additionally, about half of the river and stream miles and lake acres across the United States are too polluted for swimming, fishing or drinking, according to the Environmental Integrity Project. Awareness of the problem is growing: in a 2017 Gallup poll, 63% of Americans worried a great deal about pollution of drinking water, and 57% about pollution of rivers, lakes and reservoirs. In short, water management is a major issue, but awareness of the problem is strong, opening the door to a solution.

It is becoming more difficult for businesses to rely on giant, centralized water utilities to meet the challenge and more and more business users are doing their own water treatment and recycling. Whether by choice or necessity, those businesses that invest in onsite water systems gain a tangible asset on their business and real estate and can enjoy better water quality at a lower cost, especially if treated water is recycled.

WODI helps self-reliant businesses build “decentralized water wealth” for themselves while also helping their communities. Environmental, social and governance (ESG) investing guidelines, which drive about a quarter of all professionally managed assets around the world, specifically include the key factor of how well corporations manage water.

As civil infrastructure ages and fails and as the costs for new and replacement infrastructure increase year over year, we believe engineers and end-users will search for new ways and methods of deploying water and wastewater systems that are less expensive to deliver and much less expensive to own and operate, with the mission of substantially increasing the replacement intervals currently experienced by conventional construction materials and product delivery models.

WODI offers a unique product line of prefabricated water transport and treatment systems. WODI designs, manufactures and delivers (i) prefabricated water transport (pump and lift stations) under the EveraMOD brand, and (ii) WWTP products under the EveraSKID and EveraTREAT brands to customers and end-users that are required to clean their own wastewater, such as schools, small communities, institutional facilities, real estate developments, factories, and industrial parks.

Solution

Modular Water Systems. WODI provides a broad selection of standardized and custom engineered wastewater treatment products, packaged lift stations, and ancillary wastewater infrastructure solutions for agricultural, commercial, industrial, and municipal customers. Wastewater collection, treatment, and disposal systems reflect a substantial investment in both time and money and given the importance of protecting the environment and our precious water resources. WODI strives to deliver the industry’s most durable, sustainable, and affordable equipment packages. Our utilization of heavy plastic manufacturing combined with the integration of emerging treatment technologies creates a robust combination of capabilities that will significantly improve system performance, substantially extend continuous duty service life, and dramatically reduce operating costs.

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Packaged wastewater treatment systems have been around for more than 75 years. While typically out of sight and mind, they are a necessary component to many aspects of human life and provide an important service by protecting our health and the local environment. Unfortunately, decentralized wastewater treatment technologies have not evolved significantly over the past 50 years, especially when compared to things like personal computers, smart phones, solar panels, and the electric car. Older clunky treatment technologies that are expensive to construct and difficult to operate have been the norm for way too long. One of our goals is to simplify the delivery of packaged wastewater treatment systems. Buying and installing a treatment system must be easy and inexpensive.

WODI’s EveraSKID is a modular mobile packaged wastewater treatment system designed to treat domestic, municipal, and light industrial wastewaters. EveraSKID is factory assembled so that it ships as a finished product that is ready for immediate use once installed at its final site destination. In other words, it’s a “plug and play” system that commissions in less than one day. EveraSKID utilizes the lasted advancements in wastewater technology including fixed film biological treatment, membrane bioreactor filtration, and real-time remote monitoring and control systems. With two pipe connection points, one power connection, and an internet connection, we believe EveraSKID is the simplest to install treatment system in the market today.

 

With vessel service life lasting 75+ years—typically three times longer than conventional systems—SRTP materials represent a major advancement in the delivery and sustainability of industrial water and wastewater systems. Our water and wastewater treatment solutions will reduce both capital and operating expenses dramatically.

Civil Engineers and Utility Owners are faced with the daunting task of trying to service an ever-growing threat to the environment resulting from deteriorated and failing utility systems. Implementing sustainability requirements into water and wastewater processing solutions has become increasingly important. The implementation of SRTP tankage offers the first real significant material advancement in the last 50 years that will overcome these serious challenges to sustainability.

Because WODI’s Modular Water Systems use SRTP materials and high-tolerance factory assembly under controlled conditions, our units will reduce both installation time and costs, as well as total lifetime cost of product ownership.

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WODI’s product line of wastewater management systems is a preferred choice for decentralized wastewater treatment in residential, commercial, agricultural and many industrial and municipal settings. Treatment capacities in our standard units range from the modular 2,000-10,000 gallons per day (GPD) and 10,000-25,000 GPD standard compacts and 25,000 GPD up to 250,000 GPD in larger custom-built units. Some applications enable standard units used in tandem for average daily flows of up to 50,000 GPD.

Competitive Strengths

Marketing. WODI’s competitors in the mid-market decentralized water business tend to focus on sub-segments of the industry but fail to position their products as a practical solution in a variety of contexts. In contrast, WODI has positioned itself as a viable solution in a variety of residential, commercial and governmental contexts.

 

 

Materials. WODI utilizes high density polyethylene (“HDPE”) in constructing its water treatment products in contrast to competitors which use fiberglass, concrete, epoxy coated steel and rotomolded plastic. HDPE presents significant advantages related to reduced construction times, increased life span and transportability. Fiberglass construction is fragile, comes with high initial costs and is subject to UV destruction. Concrete and epoxy coated steel are durable but are extremely limited by shipping and transport issues. Rotomolded plastic offers faster construction times but is extremely limited in size. Typically, HDPE’s downfall is its higher development cost, however, WODI’s proprietary processes address this issue. Among its competitors, only WODI has a unique, patented materials solution which is superior to its competitors.

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Patents. WODI’s chief engineer, Dan Early, holds critical patents, which are exclusively licensed to WODI, which allow the company to utilize HDPE in its construction, and offer innovative wastewater treatment solutions.

 

WODI’s Team

WODI’s team brings together over a quarter century of experience in decentralized water systems as well as experience developing start-up companies, and managing middle-market and public companies.

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Riggs Eckelberry; Co-Founder, Chairman and CEO. Mr. Eckelberry has served as OCLN’s Chief Executive Officer, Chairman, Secretary, Treasurer, and President since OCLN was acquired in October 2015. As co-founder, Mr. Eckelberry brings his veteran technology management skills to the Blue Technology sector. Prior to joining OCLN, Mr. Eckelberry served as President and COO of CyberDefender Corporation from 2005 to 2006, where he was instrumental in building the company and its innovative product line, helping to achieve initial funding and a NASDAQ IPO. From 2001 to mid-2005, he served as founder and President of TechTransform, a technology consulting firm. From 2003 to 2004, he served as a marketing consultant where he was a key member of the team that commercialized YellowPages.com, resulting in its sale for $100 million to SBC/BellSouth. In 2003, Mr. Eckelberry served as the U.S. General Manager of Panda Software. During the high-tech boom of the 1990s, he was responsible for the global brand success of the software product, CleanSweep; as Chief Operating Officer of MicroHouse Technologies, he helped to achieve a successful sale of the company to Earthweb; and he was a key member of the team that sale of venture-backed TriVida to what is now a division of ValueClick.

Thomas Marchesello; Chief Operating Officer. Tom Marchesello has served as Chief Operating Officer of OriginClear since June 2018. From January 2015 to April 2019, he was a Corporate Development and Operations Consultant for Maxatech Group, a management consultant company. From October 2013 to December 2014, he was Director, Crypto, Data Tech & ESG Acquisitions for CME Group, a financial services company. From January 2011 to December 2013, he was Director of M&A for the Investment Banking Group of Bainbridge, Inc. Prior to that, he was Director of Media Business Intelligence at Thomson Reuters from 2005 to 2011, Fintech & eCommerce Investment Analyst at Morgan Stanley from 2002 to 2006, and Mobile Devices & Digital Asset Management Systems Product Manager at Sony from 1998 to 2002. He began his career in the U.S. Air Force, leading in aerospace operations and strategy at Air Force Space Command Headquarters from 1992 to 2000.  Tom holds a BS in Finance from Pennsylvania State University and an MBA from San Diego State University. He holds US Patent #7,613,634, for performing Electronic Retailing. He received two Air Force Achievement Medals, two Air Force Commendation Medals, and a Gulf War Service Medal.

Ken Berenger; Executive Vice President. Ken Berenger joined OriginClear in 2018 and serves as the Executive Vice President. Mr. Berenger has over twenty-five years of banking, investment, consulting, sales force training, and corporate finance experience.  His experience ranges from public markets, private debt and equity, to consumer debt counseling and resolution and real estate financing ─ working extensively with distressed homeowners and legal professionals during the foreclosure crisis of 2008. Mr. Berenger earned an Emeritus Credential In Fintech Revolution: Transformative Financial Services and Strategies from the Wharton School of the University of Pennsylvania.

Prasad Tare; Chief Financial Officer. Prasad Tare has served as the Chief Financial Officer of OriginClear since June 2021. From March 2019 to April 2021, he was the Chief Financial Officer of Vertical Global Investments LLC, a private investment group. Prior to that, he was a Director at CBIZ Risk Advisory Services, a national public accounting and consulting firm, from 2016 to 2019, a Manager at RSM US LLP from 2013 to 2016 and a Senior Manager at EisnerAmper from 2004 to 2013.

AJ Fikejs; Vice President of Marketing. AJ Fikejs joined OriginClear in November 2023 as Vice President of Marketing. From October 2022 to November 2023, Mr. Fikejs was a Product Manager at Nielsen Holdings. Prior to that he was a Product Owner at Philips Respironics from July 2015 to October 2022. Mr. Fikejs holds a BS in Business Administration from Westminster College and an MBA from Chatham University.

William Charneski; Vice President of Mergers & Acquisitions. Since William Charneski joined OriginClear in 2014 he has served as Director of Engineering, Operations Manager, International Licensee Manager and is currently the Vice President of Mergers & Acquisitions. Mr. Charneski began his career at Dow Chemical in 1968, initially as a process engineer and later as a project manager, superintendent of various plans and Regional Sales Manager of specialty chemicals in the Western United States. He holds an MBA from Central Michigan University as well as a BS in Mechanical Engineering from the University of Illinois.

Daniel M. Early, P.E.; Chief Engineer. Daniel Early has served as Chief Engineer of OriginClear since January 2020 and General Manager of MWS since July 2018. From 2017 to 2018 he was a Senior Engineer and National Sales Manager at Applied Technologies, Inc. He was the Chief Technology Officer of Apptech Solutions, LLC from August

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2010 to December 2016 and the President and Managing Partner of ACS Design, LLC from April 2002 to August 2010. Mr. Early holds a Bachelor of Science in Civil Engineering from Virginian Polytechnic Institute & State University (Virginia Tech) and is licensed as a Professional Engineer in Virginia, North Carolina, West Virginia, Montana, Pennsylvania, Maryland, New Mexico and North Dakota.

Marc Stevens; President, PWT Division. Marc Stevens founded Progressive Water Treatment, Inc. in 2000. In October 2015, OriginClear closed on the acquisition of PWT. Mr. Stevens started in the water industry in the 1980s as an assembler and shop helper, ultimately responsible for mechanical design, equipment fabrication, installation, startup and various service projects. He graduated to production and facility maintenance, and team management, before launching PWT. Marc is a graduate of DHP’s Water Treatment Certification Program (WTCP), the only high purity water treatment certification program in the industry.

Colin Sherman; Operations Manager, MWS. Colin Sherman joined OriginClear in January 2023 as Operations Manager. Mr. Sherman was self-employed as a business consultant from November 2021 to December 2022 and worked as a Commercial Manager at Poulin Cooling Air Condition and Refrigerating LLC from July 2020 to January 2021. Prior to that he was a Finance Manager/Consultant at Advanced Medical Integration from March 2020 to June 2020. Mr. Sherman emigrated to the United States from Australia in 2019 and did not work while awaiting work authorization related to his immigration status. From March 2011 to August 2018 Mr. Sherman worked as a Project Manager in various agencies of the New South Wales state government, including Transport for NSW, Office of Environment and Heritage, Ministry of Health, and New South Wales Treasury.

WODI’s Competition

Competitive Analysis

WODI’s competitors fail to differentiate in terms of technology and marketing, subjecting them to macro-industry opportunities and threats. In contrast, WODI stands out in terms of technology, product, installation and marketing.

 

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Intellectual Property

WODI holds several patents related to its MWS and WOD services. WODI has applied for a registered trademark for the mark “Water On Demand” and “Progressive Water Treatment” in the United States. WODI relies and expects to continue to rely on a combination of confidentiality agreements with its employees, consultants, and third parties with whom it has relationships, as well as trademark, copyright, patent, trade secret, and domain name protection laws, to protect its proprietary rights. In connection with the purchase of MWS, WODI acquired all of the intellectual property related to the MWS business, which include a license to certain patents, trade secrets and intellectual property assets. These patents include:

#

Owner

Jurisdiction

Description

Patent No.

Date Patent Issued

Expiration Date

1

Daniel Early

U.S.

Wastewater System & Method

US 8,372,274 B2 Applications: WIPO, Mexico

02/12/13

07/16/31

2*

Daniel Early

U.S.

Steel Reinforced HDPE Rainwater Harvesting

US 8,561,633 B2

10/22/13

05/16/32

3*

Daniel Early

U.S.

Wastewater Treatment System CIP

US 8,871,089 B2

10/28/14

05/07/32

4

Daniel Early

U.S.

Scum Removal System for Liquids

US 9,205,353 B2

12/08/15

02/19/34

5

Daniel Early

U.S.

Portable, Steel Reinforced HDPE Pump Station CIP

US 9,217,244 B2

12/22/15

10/20/31

*Patents 2 and 3 above are currently inactive and are in the process of being restored. Neither of these patents are considered core to the business.

Government Regulation

We are subject to various laws, regulations, and permitting requirements of federal, state, and local authorities, related to health and safety, anti-corruption and export controls. The foregoing may include the U.S. Foreign Corrupt Practices Act of 1977, the U.S. Export Administration Regulations, Money Laundering Control Act of 1986 and any other equivalent or comparable laws of other countries. We believe that we are in material compliance with all such laws, regulations, and permitting requirements.

Employees and Human Capital Resources

As of February 12, 2024, WODI had 32 full-time employees and seven contractors working for WODI. WODI has an arrangement with OriginClear, Inc. whereby OriginClear provides operational and administrative services for WODI.  Following the business combination, it is anticipated that approximately 32 employees and seven contractors will be employed by WODI and will work directly for the combined company.

Facilities

WODI’s corporate headquarters are located at 13575 58^th Street North, Suite 200, Clearwater, Florida 33760. WODI’s manufacturing facilities are located at 2535 E. University Drive, McKinney, Texas 75069, which includes five buildings totaling 12,400 square feet on 1.7 acres of land. The property includes additional space for several more assembly buildings when and if needed.

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Legal Proceedings

WODI is not involved in any litigation, and its management is not aware of any pending or threatened legal actions relating to its intellectual property, conduct of business activities or otherwise. From time to time, we may be involved in pending or threatened claims relating to contract disputes, employment, intellectual property and other matters that arise in the normal course of our business, which we do not deem to be material to the business.

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MANAGEMENT’S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS OF WODI

You should read the following discussion and analysis of WODI’s financial condition and results of operations together with our condensed consolidated financial statements and the related notes appearing at the end of this proxy statement/prospectus/consent solicitation statement. Some of the information contained in this discussion and analysis or set forth elsewhere in this proxy statement/prospectus/consent solicitation statement, including information with respect to WODI’s plans and strategy for its business and related financing, includes forward-looking statements that involve risks and uncertainties. As a result of many factors, including those factors set forth in the “Risk Factors” section of this proxy statement/prospectus/consent solicitation statement, our actual results could differ materially from the results described in or implied by the forward-looking statements contained in the following discussion and analysis. Unless otherwise indicated or the context otherwise requires, references in this section to “WODI,” “we,” “us,” “our” and other similar terms refer to WODI.

 

Water on Demand, Inc. (Texas)(Formerly Progressive Water Treatment, Inc.)

 

Business Combination Agreement

 

On October 24, 2023, WODI entered into the BCA with FRLA and Merger Sub.

 

The BCA provides, among other things, that Merger Sub will merge with and into WODI, with WODI as the surviving company in the merger and, after giving effect to such merger, WODI shall be a wholly-owned subsidiary of FRLA (the “Merger”). FRLA will change its name to “Water on Demand, Inc.” The Merger and the other transactions contemplated by the BCA are hereinafter referred to as the “Business Combination.” In accordance with the terms and subject to the conditions of the BCA, at the effective time of the Merger (the “Effective Time”), among other things: (i) each share of FRLA Class A Common Stock and each share of FRLA Class B Common Stock (except for FRLA Class B Common Stock held by the Sponsor which are subject to forfeiture pursuant to the Sponsor Letter Agreement) that is issued and outstanding immediately prior to the Merger will become one share of our common stock, par value $0.0001 per share, and (ii) each share of common stock of WODI (subject to limited exceptions) issued and outstanding as of immediately prior to the Effective Time shall be automatically canceled and extinguished and converted into the right to receive that number of shares of our common stock equal to an exchange ratio, calculated as (a) the aggregate equity value of WODI of $32.0 million, divided by the aggregate number of shares of WODI common stock outstanding immediately prior to the Effective Time, divided by (b) the FRLA Share Value, where “FRLA Share Value” means (i) the aggregate amount of cash on deposit in the Trust Account (without giving effect to stockholder redemptions) as of two business days prior to the closing date of the Merger, including interest not previously released to us to pay our taxes divided by (ii) the total number of then issued and outstanding shares of FRLA Class A Common Stock (without giving effect to stockholder redemptions).

 

Critical Accounting Policies

 

The Securities and Exchange Commission (“SEC”) defines “critical accounting policies” as those that require application of management’s most difficult, subjective or complex judgments, often as a result of the need to make estimates about the effect of matters that are inherently uncertain and may change in subsequent periods. Not all of the accounting policies require management to make difficult, subjective or complex judgments or estimates. However, the following policies could be deemed to be critical within the SEC definition.  The Company has a fiscal year end of December 31^st.

 

Revenue Recognition

 

Revenue will be received in the form of interest and fees in connection with financing projects.  Revenue is recognized at the time of receipt.

 

Revenues and related costs on construction contracts are recognized as the performance obligations for work are satisfied over time in accordance with Accounting Standards Codification (“ASC”) 606, Revenue from Contracts with

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Customers. Under ASC 606, revenue and associated profit, will be recognized as the customer obtains control of the goods and services promised in the contract (i.e., performance obligations). All un-allocable indirect costs and corporate general and administrative costs are charged to the periods as incurred. However, in the event a loss on a contract is foreseen, the Company will recognize the loss as it is determined. Revisions in cost and profit estimates during the course of the contract are reflected in the accounting period in which the facts for the revisions become known. Provisions for estimated losses on uncompleted contracts are made in the period in which such losses are determined. Changes in job performance, job conditions, and estimated profitability, including those arising from contract penalty provisions, and final contract settlements, may result in revisions to costs and income, which are recognized in the period the revisions are determined.

 

Use of Estimates

 

The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities, disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. Significant estimates include estimates used to review the Company’s goodwill, impairments and estimations of long-lived assets, revenue recognition on percentage of completion type contracts, allowances for uncollectible accounts, inventory valuation, valuations of non-cash capital stock issuances and the valuation allowance on deferred tax assets. The Company bases its estimates on historical experience and on various other assumptions that the Company believes to be reasonable in the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

 

Fair Value of Financial Instruments

 

Fair value of financial instruments requires disclosure of the fair value information, whether or not recognized in the balance sheet, where it is practicable to estimate that value. As of December 31, 2022, the amounts reported for cash, prepaid expenses, accounts payable and accrued expenses approximate the fair value because of their short maturities.

 

Results of Operations

 

WODI is the combination of three business units formed by OriginClear, Inc., which consists of Progressive Water Treatment (“PWT”), Modular Water Systems (“MWS”) and Water on Demand, Inc. (“WODI NV”).  The combined companies offer complementary offerings that create meaningful synergies with the goal of allowing WODI to emerge as a leader in offering end-to-end outsourced water treatment services.  In this section, the combined entity will be referred to as “WODI Combined”, as compared to WODI (formerly PWT combined with MWS) and WODI NV.

 

WODI designs and manufactures a complete line of water treatment systems for municipal, industrial and pure water applications. Its uniqueness is its ability to gain an in-depth understanding of customer’s needs and then to design and build an integrated water treatment system using multiple technologies to provide a complete solution for its customers. WODI utilizes a wide range of technologies, including chemical injection, media filters, membrane, ion exchange and SCADA (supervisory control and data acquisition) technology in turnkey systems. WODI also offers a broad range of services including maintenance contracts, retrofits and replacement assistance. In addition, WODI rents equipment in contracts of varying duration.  Customers are primarily served in the United States and Canada, with the company’s reach extending worldwide from Siberia to Argentina to the Middle East.

 

In 2018, OCLN launched MWS, a leader in onsite, pre-fabricated wastewater treatment systems made with sophisticated materials that can last decades. MWS offers modular wastewater treatment products designed for commercial development, RV parks and campgrounds, residential development, schools and institutions, hotels and resorts and various other applications. MWS’s modular water treatment systems are factory assembled before shipment and on-site installation. MWS’s pre-fabrication strategy significantly simplifies and expedites final installation.

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MWS’s modular systems utilize the latest advancements in wastewater technology including fixed film biological treatment, membrane bioreactor filtration and real-time remote monitoring and control systems. MWS systems utilize high quality Structurally Reinforced ThermoPlastics (SRTP), which offers significant advantages over other treatment systems, including longevity and transportability.

 

In 2023, OCLN launched WODI NV to offer private businesses the opportunity to outsource and finance water treatment and purification services on a per-gallon basis while gaining independence from traditional, centralized private water infrastructure. WODI NV’s value proposition is that by outsourcing water treatment and purification, private businesses can gain the water security of a private, decentralized infrastructure while avoiding the capital, technological and administrative burden required to design, finance, build, operate and maintain a water treatment solution. WODI NV uses a Design-Build-Own-Operate model for its pay-as-you-go water solutions for private businesses.

 

We are incurring expenses in connection with the operation of the business.

 

For the nine months ended September 30, 2023, WODI Combined had a net loss of $12,447,782 which represented sales of $5,181,199, offset by cost of goods sold in the amount of $4,646,349, operating expenses of $912,911, other income of $127,448, impairment of receivable from SPAC in the amount of $3,210,985, preferred stock incentive compensation in the amount of $576,617, conversion and settlement value added to note purchase agreements in the amount of $7,728,089, and interest and dividend expenses in the amount of $681,478.

 

For the nine months ended September 30, 2022, WODI and PWT had a net income of $497,669, which represented sales of $7,748,414, offset by cost of goods sold in the amount of $6,484,235, operating expenses of $745,384, and dividend expense in the amount of $21,126.

 

For the year ended December 31, 2022, WODI had a net income of $626,454 which consisted of $10,350,281 in sales less $8,881,276 in cost of goods and offset by operating expenses in the amount of $1,153,815 and other income and expenses in the amount of $311,264.

 

For the year ended December 31, 2021, WODI had net income of $26,802 which represents of $4,116,662 in sales less $3,574,060 in cost of goods and offset by operating expenses in the amount of $747,216 and other income and expenses in the amount of $231,421.

 

For the period from April 22, 2022 (Date of Inception) through December 31, 2022, WODI NV had no revenue but generated net loss in the amount of $947,508:

 

	April 22, 2022 (inception) through December 31, 2022
Revenue	$-
Cost of Goods Sold	-
Operating Expenses, Depreciation and Amortization	205,250
Loss from Operations before Other Income (Expense)	(205,250)
Other Income (Expense)	(742,258)
Net Income (Loss)	$(947,508)

 

WODI NV general administrative expenses for the period from April 22, 2022 (Inception) through December 31, 2022 was $205,250 which included marketing expenses, costs associated with securities offerings and other general administrative expenses. There was no other income for the period from inception through December 31, 2022.  For

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the period from inception through December 31, 2022, the Company incurred expenses related to the impairment of receivable and interest expense totaling $742,258.

 

Liquidity and Capital Resources

 

As of September 30, 2023, WODI Combined had total assets in the amount of $7,325,118, which consisted of cash in the amount of $943,802, contracts receivable $1,478,505, contract assets in the amount of $908,327, due from related party in the amount of $3,590,374, net property and equipment in the amount of $4,110 and other assets consisting of SPAC Class B common shares valued at $400,000 and had total liabilities in the amount of $19,638,166, which consisted of $1,114,742 in accounts payable, $667,495 in accrued expenses, $1,271,095 in contract liabilities, $13,600 tax liability, $143,503 in customer deposits, a warranty reserve in the amount of $20,000, $139,879 for a line of credit, due to related party in the amount of $495,763 and convertible promissory notes in the amount of $15,772,089. As of December 31, 2022 and 2021, WODI (TX) had total assets of $5,262,287 and $2,860,749, respectively, and total liabilities of $5,764,170 and $3,061,022, respectively.

 

For the nine months ended September 30, 2023 and 2022, cash used in investing activities for WODI Combined and PWT was $3,210,985 and $0, respectively.

 

During the period from April 22, 2022 (inception) through December 31, 2022, net cash used in operations by WODI NV was ($57,645).  As of December 31, 2022, WODI NV had working capital deficit of $909,269 and an accumulated deficit of $588,318. These factors, among others raise substantial doubt about our ability to continue as a going concern. Our independent auditors, in their report on our audited financial statements for the period from April 22, 2022 (inception) through December 31, 2022 expressed substantial doubt about our ability to continue as a going concern. The ability of us to continue as a going concern and appropriateness of using the going concern basis is dependent upon, among other things, additional cash infusion. We have obtained funds from investors in the period from April 22, 2022 (inception) through December 31, 2022, and we are pursuing various financing alternatives to fund the Company’s operations so it can continue as a going concern in the medium to long term. Management believes this funding will continue from our current investors and new investors. There can be no assurance that such funding will be available to the Company in the amount required at any time or, if available, that it can be obtained on terms satisfactory to the Company. Management believes the existing shareholders, the prospective new investors and future revenue will provide the additional cash needed to meet our obligations as they become due and will allow the development of our core business operations.

 

Cash Flow

 

The table below, for the periods indicated, provides selected cash flow information:

 

		April 22, 2022 (inception) through December 31, 2022
Net cash used in operating activities		$(57,645)
Net cash used in investing activities		1,137,267
Net cash provided by financing activities		1,372,500
Net increase in cash and cash equivalents		$177,588

 

At December 31, 2022, we had cash of $177,588.

 

During the period from April 22, 2022 (inception) through December 31, 2022, we raised an aggregate of $1,372,500 in convertible secured promissory notes and issuance of common stock. Our ability to continue as a going concern is dependent upon raising capital from financing transactions and future revenue, however, there cannot be any assurance that we will be able to raise additional capital from financings.

 

Net cash used in operating activities was $(57,645) for the period from April 22, 2022 (inception) through December 31, 2022.

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Net cash flows (used in) investing activities for the period from April 22, 2022 (inception) through December 31, 2022 was $(1,137,267).

 

Net cash flows provided by financing activities was $1,372,500 for the period from April 22, 2022 (inception) through December 31, 2022.

 

Although our proceeds from the issuance of convertible debt together with revenue from operations are currently sufficient to fund our operating expenses in the near future, we will need to raise additional funds in the future so that we can expand our operations and complete the business combination. Therefore, our future operations are dependent on our ability to secure additional financing. Financing transactions may include the issuance of equity or debt securities, obtaining credit facilities, or other financing mechanisms. However, a downturn in the U.S. equity and debt markets could make it more difficult to obtain financing through the issuance of equity or debt securities. Even if we are able to raise the funds required, it is possible that we could incur unexpected costs and expenses, fail to collect significant amounts owed to us, or experience unexpected cash requirements that would force us to seek alternative financing. Furthermore, if we issue additional equity or debt securities, stockholders may experience additional dilution or the new equity securities may have rights, preferences or privileges senior to those of existing holders of our common stock. The inability to obtain additional capital may restrict our ability to grow and may reduce our ability to continue to conduct business operations. If we are unable to obtain additional financing, we may have to curtail our marketing and development plans and possibly cease our operations.

 

We have estimated our current average burn and believe that we have assets to ensure that we can function without liquidation for a limited time, due to our cash on hand, future revenue, and our ability to raise money from our investor base. Based on the aforesaid, we believe we have the ability to continue our operations for the immediate future and will be able to realize assets and discharge liabilities in the normal course of operations. However, there cannot be any assurance that any of the aforementioned assumptions will come to fruition and as such we may only be able to function for a short time.

 

Common Control Transactions

 

The financial statements presented are based on common control accounting per Financial Accounting Standards Boards (“FASB”) Accounting Standards Codification (“ASC”) 805 as the Company's Executive Officer, T. Riggs Eckelberry, has a controlling financial interest in both WODI and PWT and therefore, WODI Combined. Mr. Eckelberry holds 1,000 shares of Series C preferred stock of OriginClear, Inc. which entitles Mr. Eckelberry 51% of the total voting power of OriginClear, Inc. stockholders.  As of September 30, 2023, OriginClear, Inc. owned 91% of WODI Combined.  OriginClear, Inc. provides operational, management  and administrative services to WODI including its Chief Executive Officer, Chief Financial Officer, Chief Operating Officer, full time employees and consultants.

 

Off-Balance Sheet Financing Arrangements

 

We have no obligations, assets or liabilities that would be considered off-balance sheet arrangements as of September 30, 2023 and December 31, 2022. We do not participate in transactions that create relationships with unconsolidated entities or financial partnerships, often referred to as variable interest entities, which would have been established for the purpose of facilitating off-balance sheet arrangements. We have not entered into any off-balance sheet financing arrangements, established any special purpose entities, guaranteed any debt or commitments of other entities, or purchased any non-financial assets.

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Contractual Obligations

As of September 30, 2023, WODI Combined had an aggregate of $19,638,166 in long-term liabilities including $495,763 payable to related parties.  As of September 30, 2023, WODI Combined had an aggregate of $3,590,374 in promissory notes issued to related parties.

Fair Value of Financial Instruments

 

ASC Topic 820 “Fair Value Measurements and Disclosures” defines fair value, the methods used to measure fair value and the expanded disclosures about fair value measurements. Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between the buyer and the seller at the measurement date. In determining fair value, the valuation techniques consistent with the market approach, income approach and cost approach shall be used to measure fair value. ASC Topic 820 establishes a fair value hierarchy for inputs, which represent the assumptions used by the buyer and seller in pricing the asset or liability. These inputs are further defined as observable and unobservable inputs. Observable inputs are those that buyer and seller would use in pricing the asset or liability based on market data obtained from sources independent of us. Unobservable inputs reflect our assumptions about the inputs that the buyer and seller would use in pricing the asset or liability developed based on the best information available in the circumstances.

 

The fair value hierarchy is categorized into three levels based on the inputs as follows:

 

·

Level 1 – Valuations based on unadjusted quoted prices in active markets for identical assets or liabilities that we have the ability to access. Valuation adjustments and block discounts are not being applied. Since valuations are based on quoted prices that are readily and regularly available in an active market, valuation of these securities does not entail a significant degree of judgment.

 

·

Level 2 – Valuations based on (i) quoted prices in active markets for similar assets and liabilities, (ii) quoted prices in markets that are not active for identical or similar assets, (iii) inputs other than quoted prices for the assets or liabilities, or (iv) inputs that are derived principally from or corroborated by market through correlation or other means.

 

·

Level 3 – Valuations based on inputs that are unobservable and significant to the overall fair value measurement.

 

The fair value of our assets and liabilities, which qualify as financial instruments under ASC Topic 820, “Fair Value Measurements and Disclosures,” approximates the carrying amounts represented in the accompanying balance sheets, primarily due to their short-term nature.

 

Income Taxes

 

We account for income taxes under ASC 740 Income Taxes (“ASC 740”). ASC 740 requires the recognition of deferred tax assets and liabilities for both the expected impact of differences between the financial statement and tax basis of assets and liabilities and for the expected future tax benefit to be derived from tax loss and tax credit carry forwards. ASC 740 additionally requires a valuation allowance to be established when it is more likely than not that all or a portion of deferred tax assets will not be realized.

 

ASC 740 also clarifies the accounting for uncertainty in income taxes recognized in an enterprise’s financial statements and prescribes a recognition threshold and measurement process for financial statement recognition and measurement of a tax position taken or expected to be taken in a tax return. For those benefits to be recognized, a tax position must be more-likely-than-not to be sustained upon examination by taxing authorities. ASC 740 also provides guidance on derecognition, classification, interest and penalties, accounting in interim period, disclosure and transition.

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We recognize accrued interest and penalties related to unrecognized tax benefits as income tax expense. There were no unrecognized tax benefits and no amounts accrued for interest and penalties as of December 31, 2022 and 2021. We are currently not aware of any issues under review that could result in significant payments, accruals or material deviation from its position.

 

We have identified the United States as its only “major” tax jurisdiction.

 

We may be subject to potential examination by federal and state taxing authorities in the areas of income taxes. These potential examinations may include questioning the timing and amount of deductions, the nexus of income among various tax jurisdictions and compliance with federal and state tax laws. Our management does not expect that the total amount of unrecognized tax benefits will materially change over the next twelve months.

 

We comply with accounting and disclosure requirements of FASB ASC 260, Earnings Per Share. In order to determine the net income (loss) attributable to both the redeemable shares and non-redeemable shares, we first considered the undistributed income (loss) allocable to both the redeemable Common Stock and non-redeemable Common Stock and the undistributed income (loss) is calculated using the total net loss less any dividends paid. We then allocated the undistributed income (loss) ratably based on the weighted average number of shares outstanding between the redeemable and non-redeemable Common Stock. Any remeasurement of the accretion to redemption value of the Common Stock subject to possible redemption was considered to be dividends paid to the public stockholders.

 

Recent Accounting Pronouncements

 

In August 2020, the FASB issued ASU 2020-06, “Debt – Debt Conversion and Other Options (Subtopic 470-20) and Derivatives and Hedging – Contracts in Entity’s Own Equity (Subtopic 815-40).” The amendment in this ASU is to address issues identified as a result of the complexity associated with applying generally accepted accounting principles (GAAP) for certain financial instruments with characteristics of liabilities and equity. For convertible instruments, the Board decided to reduce the number of accounting models for convertible debt instruments and convertible preferred stock per this ASU. Limiting the accounting models results in fewer embedded conversion features being separately recognized from the host contract as compared with prior GAAP. Convertible instruments that continue to be subject to separation models are (1) those with embedded conversion features that are not clearly and closely related to the host contract, that meet the definition of a derivative, and that do not qualify for a scope exception from derivative accounting and (2) convertible debt instruments issued with substantial premiums for which the premiums are recorded as paid-in capital. The amendments in this ASU are effective for public business entities that meet the definition of a Securities and Exchange Commission (SEC) filer, excluding entities eligible to be smaller reporting companies as defined by the SEC, for fiscal years beginning after December 15, 2021, including interim periods within those fiscal years. For all other entities, the amendments are effective for fiscal years beginning after December 15, 2023, including interim periods within those fiscal years. Early adoption is permitted, but no earlier than fiscal years beginning after December 15, 2020, including interim periods within those fiscal years. The Board specified that an entity should adopt the guidance as of the beginning of its annual fiscal year. We have not early adopted the ASU and it will become effective for us on January 1, 2024 as we are an emerging growth company. We believe the adoption of this ASU would not have a material effect on our financial statements.

 

Management does not believe that any recently issued, but not effective, accounting standards, if currently adopted, would have a material effect on our financial statements.

 

Recent Trends

 

Our primary goal remains meeting client demands for additional orders of our technology and ensuring consistent performance in the field. The Company is focused on scaling its business to meet incoming orders. Increasing demand, along with media coverage in the United States, has driven and continues to drive an increase in orders and client inquiries.

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Sales trends for the periods ended September 30, 2023 and December 31, 2022 showed demand across all of Water On Demand’s product service lines. The sales pipeline continues to grow and is strong, though similar to many business-to-business transactions, the enterprise sales cycle is extremely lengthy. Although we have executed contracts in less than 30 days, notionally these negotiations can range up to several years, taking into account the customer’s budget, finance, legal, facilities and other reviews. The sales process for this brand-new offering type requires significant streamlining and improvements, and we are taking steps to ensure our sales processes are robust, repeatable, and can enable our products to move through the sales pipeline quicker.

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UNAUDITED PRO FORMA CONDENSED COMBINED FINANCIAL INFORMATION 

The unaudited pro forma condensed combined financial statements combines the historical financial statements of Fortune Rise Acquisition Corporation (“FRLA”), the historical financial statements of Water on Demand, Inc. (“WODI”) and the historical financial statements of Progressive Water Systems, Inc. (“PWT”) as adjusted to give effect to the Transactions. WODI merged with PWT in September 2023.  The unaudited pro forma condensed combined balance sheet gives pro forma effect to the Transactions as if they had been consummated on September 30, 2023. The unaudited pro forma condensed combined statement of operations for the nine months ended September 30, 2023 and for the year ended December 31, 2022 gives effect to the Transactions as if they had occurred on January 1, 2022, the beginning of the earliest period presented.

 

On September 21, 2023, WODI entered into a merger agreement with PWT with PWT becoming the surviving entity. In connection with the merger with WODI, PWT changed its name to Water on Demand, Inc. The financial statements of PWT as of and for the nine months ended September 30, 2023 were included in the operations of WODI for the nine months ended September 30, 2023 as if the WODI merger with PWT was occurred on January 1, 2023. The financial statements of WODI and PWT as of and for the year ended December 31, 2022 were presented separately for pro forma presentation purposes.

 

The unaudited pro forma condensed combined financial statements were prepared in accordance with Article 11 of SEC Regulation S-X, as amended by the final rule, Release No. 33-10786, Amendments to Financial Disclosures about Acquired and Disposed Businesses. Release No. 33-10786 replaced the previous pro forma adjustment criteria with simplified requirements to depict the accounting for the Transactions (“Transaction Accounting Adjustments”) and other transaction effects that have occurred or are reasonably expected to occur (“Management’s Adjustments”). Management has elected not to present Management’s Adjustments and will only be presenting Transaction Accounting Adjustments in the unaudited pro forma condensed combined financial information. The adjustments presented in the unaudited pro forma condensed combined financial statements have been identified and presented to provide relevant information necessary for an understanding of the combined company reflecting the Transactions.

 

The unaudited pro forma condensed combined financial statements are provided for illustrative purposes only and are not necessarily indicative of what the actual results of operations and financial position would have been had the Transactions taken place on the dates indicated, nor are they indicative of the future consolidated results of operations or financial position of the combined company.

 

The unaudited pro forma condensed combined balance sheet as of September 30, 2023 has been prepared using, and should be read in conjunction with, the following:

 

●

FRLA’s unaudited condensed balance sheet as of September 30, 2023 and the related notes included elsewhere in this proxy statement/prospectus; and

 

●

WODI’s unaudited condensed balance sheet as of September 30, 2023 and the related notes included elsewhere in this proxy statement/prospectus.

 

The unaudited pro forma condensed combined statement of operations for the nine months ended September 30, 2023 has been prepared using, and should be read in conjunction with, the following:

  

●

FRLA’s unaudited condensed statement of operations for the nine months ended September 30, 2023 and the related notes included elsewhere in this proxy statement/prospectus; and

 

●

WODI’s unaudited statement of operations for the nine months ended September 30, 2023 and the related notes included elsewhere in this proxy statement/prospectus.

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The unaudited pro forma condensed combined statement of operations for the year ended December 31, 2022 has been prepared using, and should be read in conjunction with, the following:

 

●

FRLA’s statement of operations for the year ended December 31, 2022 and the related notes included elsewhere in this proxy statement/prospectus; and

 

	●	WODI’s statement of operations for the year ended December 31, 2022 and the related notes included elsewhere in this proxy statement/prospectus; and
	●	PWT’s statement of operations for the year ended December 31, 2022 and the related notes included elsewhere in this proxy statement/prospectus.

 

Description of the Business Combination

On October 24, 2023, FRLA, Merger Sub, and WODI entered into the Business Combination Agreement, as amended February 6, 2024, pursuant to which WODI will merge with and into Merger Sub, with Merger Sub surviving as a wholly-owned subsidiary of FRLA (the “Merger”) and FRLA will change its name to “Water on Demand, Inc.” which will continue as the surviving public corporation after the Closing (collectively, the “Business Combination”).

Pursuant to the Business Combination Agreement, at the Effective Time, (A) each share of FRLA Class A common stock, par value $0.0001 per share (“FRLA Class A Common Stock”) and each share of FRLA Class B common stock, par value $0.0001 per share (“FRLA Class B Common Stock”) (other than such shares of FRLA Class B Common Stock held by Fortune Rise Sponsor, LLC, a Delaware limited liability company (the “Sponsor”) which were forfeited pursuant to the Sponsor Letter Agreement (as defined below) that is issued and outstanding immediately prior to the Merger shall become one share of FRLA common stock, par value $0.0001 per share (“Common Stock”), (B) each share of capital stock of Merger Sub issued and outstanding immediately prior to the Effective Time will be automatically cancelled and extinguished and converted into one share of common stock, par value $0.0001, of WODI (“WODI Common Stock”); (C) each share of WODI Preferred Stock shall convert to WODI Common Stock in accordance with the terms thereof immediately prior to the Effective Time; (D) each share of WODI Common Stock (other than the WODI Common Stock held as treasury stock by WODI) issued and outstanding as of immediately prior to the Effective Time shall be automatically canceled and extinguished and converted into the right to receive that number shares of Common Stock equal to the Merger Consideration (as defined below); (E) any shares of WODI Common Stock that are restricted or subject to vesting shall automatically vest and be converted into shares of Common Stock granted as part of the Merger Consideration; (F) certain convertible promissory notes issued by WODI shall convert into shares of WODI Common Stock; and (G) each share of WODI Common Stock held by WODI as treasury stock immediately prior to the Effective Time will be automatically canceled and extinguished, and no consideration shall be paid with respect thereto.

WODI shareholders shall be entitled to, with respect to each outstanding share of WODI Common Stock, a number of shares of Common Stock, equal to the Exchange Ratio (the “Merger Consideration”, and the shares of Common Stock issued as Merger Consideration, the “Merger Consideration Shares”), where the Exchange Ratio is equal to the quotient of (A) (i) $32,000,000, divided by (ii) the sum of the aggregate number of shares of WODI Common Stock outstanding immediately prior to the Effective Time (including accelerated vested restricted stock grants and converted preferred stock), and (B) (i) the aggregate amount of cash on deposit in the Trust Account (without giving effect to the redemption of any shares by FRLA’s public stockholders) as of two business days prior to the Closing Date, including interest not previously released to FRLA to pay taxes of FRLA divided by (ii) the total number of then issued and outstanding shares of FRLA Class A Common Stock (without giving effect to the redemption of any shares by FRLA’s public stockholders).

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Concurrently with the execution of the Business Combination Agreement, the Sponsor, FRLA and WODI entered into a Letter Agreement (the “Sponsor Letter Agreement”), pursuant to which, among other things, the Sponsor agreed to (a) vote in favor of the Business Combination Agreement and the transactions contemplated thereby, (b) agree to or alternatively waive any adjustment to the conversion ratio set forth in the Certificate of Incorporation or other governing documents of FRLA or any other anti-dilution or similar protection with respect to the FRLA Class B Common Stock, such that the FRLA Class B Common Stock will convert into Common Stock at the Closing on a one-to-one basis, and (c) subject certain of the FRLA Class B Common Stock currently held by the Sponsor and certain FRLA Class A Common Stock issuable to the Sponsor on exercise of a warrant owned by the Sponsor to potential forfeiture, in each case, on the terms and subject to the conditions set forth in the Sponsor Letter Agreement.

Accounting for the Business Combination

The Business Combination will be accounted for as a “reverse recapitalization” in accordance with U.S. GAAP. Under this method of accounting, FRLA will be treated as the “acquired” company for financial reporting purposes. This determination is primarily based on the fact that subsequent to the Business Combination, WODI’s stockholders are expected to have a majority of the voting power of the Combined Company, WODI will comprise all of the ongoing operations of the Combined Company, WODI will comprise a majority of the governing body of the Combined Company, and WODI’s senior management will comprise all of the senior management of the Combined Company. Accordingly, for accounting purposes, the Business Combination will be treated as the equivalent of WODI issuing shares for the net assets of FRLA, accompanied by a recapitalization. The net assets of FRLA will be stated at historical costs. No goodwill or other intangible assets will be recorded. Operations prior to the Business Combination will be those of WODI.

Basis of Pro Forma Presentation

The unaudited pro forma combined financial information included in this proxy statement/prospectus has been prepared using the assumptions below with respect to the potential redemption into cash of FRLA Common Stock:

●

Assuming No Redemptions (Scenario 1): This presentation assumes that no Public Stockholders exercise their right to redeem their Public Shares (excluding the Redeemed Public Shares) for their pro rata share of the Trust Account, and thus, the full amount held in the Trust Account as of the Closing is available for the Business Combination; and

    

●

Assuming Maximum Redemptions (Scenario 2): This presentation assumes that a maximum of 3,162,548 Public Shares issued and outstanding as of the Closing are redeemed, resulting in an aggregate cash payment of approximately $34.6 million from the Trust Account based on an assumed redemption price of $10.95 per share as of September 30, 2023. As of the date of this proxy statement/prospectus, the redemption price increased from $10.95 per share to $11.08 per share which reflects $400,000 non-interest bearing loans from WODI and deposited into the Trust Account in order to extend the available time to complete the Business Combination to February 5, 2024.

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The following table illustrates estimated ownership levels in the Combined Company, immediately following the consummation of the Business Combination, based on the two scenarios of redemptions by the Public Stockholders and the following assumptions:

 

		Pro Forma Combined (Assuming No Redemptions)								Pro Forma Combined (Assuming Maximum Redemptions)
		Ownership in shares				Ownership %				Ownership in shares				Ownership %
FRLA Public Stockholders			3,162,548				38.1	%			-				-	%
FRLA Initial Stockholders			1,466,750				17.7	%			1,466,750				28.6	%
Representative Shares			120,000				1.4	%			120,000				2.3	%
WODI Shareholders(1)			3,542,691				42.8	%			3,542,691				69.1	%
Total			8,291,989				100.0	%			5,129,441				100.0	%

 

The table below shows possible sources of dilution and the extent of such dilution that non-redeeming public stockholders could experience in connection with the Closing of the Business Combination. In an effort to illustrate the extent of such dilution, the table below assumes the exercise of all FRLA Warrants, which are exercisable for one share of FRLA Common Stock at a price of $11.50 per share. The following table illustrates estimated ownership levels in the Combined Company based on the minimum and maximum scenarios of redemptions by the Public Stockholders with all possible sources of dilution and the following assumptions:

 

		Pro Forma Combined (Assuming No Redemptions)								Pro Forma Combined (Assuming Maximum Redemptions)
		Ownership in shares				Ownership %				Ownership in shares				Ownership %
FRLA Public Stockholders (2)			8,050,048				59.5	%			4,887,500				47.2	%
FRLA Initial Stockholders			1,466,750				10.8	%			1,466,750				14.2	%
Representative Shares			120,000				0.9	%			120,000				1.2	%
WODI Shareholders (1) (3)			3,883,026				28.8	%			3,883,026				37.4	%
Total			13,519,824				100.0	%			10,357,276				100.0	%

 

(1)Including the conversion of WODI’s convertible secured promissory notes into approximately 6.6 million shares of WODI common stock and the vesting of approximately 2.6 million shares of WODI’s unvested restricted stock issued to members of WODI’s Board, employees and consultants with vesting condition at the time of the consummation of the Business Combination. 

 

(2)Including the exercise of 4,887,500 of FRLA public warrants, for which, each warrant entitles the holder thereof to purchase one share of FRLA common stock at an exercise price of $11.50 per share. 

 

(3)Including 1,567,580 WODI warrants issued to investors to purchase WODI common stock at an exercise price of $0.0001 per share. These warrants will be assumed by FRLA at an exchange ratio of 0.217108213 upon consummation of the BCA.  

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