DRAFT — PRIVILEGED & CONFIDENTIAL — FOR DISCUSSION PURPOSES — SUBJECT TO REVIEW AND APPROVAL (Form 8-K)

DRAFT - PRIVILEGED & CONFIDENTIAL - FOR DISCUSSION PURPOSES - SUBJECT TO REVIEW AND APPROVAL

Blockfusion and Blue Acquisition Corp. Announce LOIs for Anchor Lease with a Leading AI Customer and $175 Million Convertible Note Financing and Non-Redemption Agreement, and Advancement of Planned Expansion of Niagara Falls Campus

NEW YORK, NY, June 30, 2026 /PRNewswire/ - Blockfusion USA, Inc. ("Blockfusion" or the "Company"), a rapidly growing developer transitioning to become an operator of high performance compute ("HPC") and AI infrastructure, and Blue Acquisition Corp. ("Blue") (Nasdaq: BACC), a publicly traded special purpose acquisition company, today announced a series of commercial, strategic and financing milestones in connection with their previously announced proposed business combination (the "Business Combination") to form a publicly traded company named Blockfusion Digital Infrastructure, Inc. ("Pubco"). These developments - a non-binding anchor lease letter of intent with a leading AI customer, non-binding term sheets for anticipated financing through a private placement of convertible notes and a non-redemption agreement, and entry into an exclusivity agreement relating to the Company's intended expansion of the Niagara Falls campus - represent the foundation for achievement of significant milestones ahead of the anticipated closing of the Business Combination.

Anchor Lease LOI for up to 300 MW

Blockfusion has entered into a non-binding letter of intent (the "LOI") with a leading AI customer for the lease of data center space and power capacity at the Company's flagship campus in Niagara Falls, New York.

Under the proposed lease terms, the offtaker would commit to up to 300 MW of total critical IT capacity at the campus, anchored by 85 MW of guaranteed take-or-pay capacity to be delivered in tranches, subject to due diligence and definitive lease terms. Each phase of capacity would carry a 15-year firm initial lease term, with two five-year renewal options.

The proposed lease structure is expected to provide long-term contracted revenue visibility supported by take-or-pay commitments, with contractual mechanisms designed to support financing and project-level debt capacity.

The LOI is non-binding, except with respect to certain provisions relating to confidentiality, exclusivity and governing law, and is subject to the negotiation and execution of definitive lease agreements for each tranche, including design and work requirements.

Based on the up to 85 MW of guaranteed take-or-pay capacity, the Company estimates that the potential aggregate lease revenue, assuming terms consistent with the LOI, could be approximately $2.8 billion over the initial 15-year lease term (or approximately $5.4 billion if the offtaker exercises both of its five-year renewal options, for a total term of 25 years), assuming that the lease agreement is executed on the terms currently contemplated, full performance, and no early termination.

Continued Expansion of the Niagara Falls Campus

In parallel, the Company is advancing the planned expansion of its Niagara Falls campus by entering into an exclusivity agreement with a landowner covering certain parcels of sufficient size and characteristics to support the full scope of the Company's contemplated campus expansion, including the development of in excess of 300 MW of total critical IT capacity over time, and is in advanced negotiations toward a definitive purchase and sale agreement for those parcels. The combination of this additional land, the Company's power position and anchor offtake demand is expected to position the Company to accelerate deployment while maintaining capital efficiency and operational control.

"Expanding our Niagara Falls campus would give us access to highly strategic, power-rich locations with existing energy infrastructure," said Kant Trivedi, Chief Operating Officer of Blockfusion.

Convertible Notes Financing and Non-Redemption Agreements

In connection with the proposed Business Combination, the Company and Blue have agreed to non-binding term sheets describing the principal terms of potential financing and non-redemption arrangements. These arrangements intend to support the capitalization of Pubco at closing, as well as the Company's initial build-out costs.

Such anticipated financing transactions include a private placement of $175 million in aggregate principal amount of convertible senior notes ("Convertible Notes"). The Convertible Notes are to be issued to certain qualified institutional buyers pursuant to the exemptions from the registration requirements of the Securities Act of 1933, as amended (the "Securities Act"), to be funded upon the closing of the Business Combination, subject to certain customary conditions and the satisfaction of conditions precedent including the consummation of the Business Combination, the execution of the anchor offtake lease agreement contemplated by the LOI described herein, and entry by the Company into agreements to acquire certain expansion sites. The Convertible Notes will convert at a premium to the business combination valuation with a cash pay coupon reflecting standard convertible note terms and duration. The Convertible Note financing is expected to be anchored by funds managed and/or advised by Sona Asset Management (US) LLC ("Sona"), an institutional credit asset manager.

In addition, Blockfusion, Blue, and Sona have entered into a non-binding term sheet for a non-redemption agreement ("NRA") pursuant to which NRA, if executed, Sona would agree not to redeem approximately 3.3 million public shares of Blue in connection with the shareholder meeting to approve the Business Combination in consideration for the delivery of certain additional shares to Sona. Blue potentially may enter into other non-redemption agreements prior to the closing of the Business Combination. The economic terms of the final Sona NRA and any other non-redemption agreement, if any, will be publicly disclosed upon the execution of any such agreements.

Proceeds from the proposed sale of Convertible Notes and funds retained in BACC's trust account at closing are expected to support the initial buildout of the Company's Niagara Falls campus as well as other working capital needs and transaction expenses.

"Together, these arrangements, if completed, would provide additional capital at closing, positioning us to execute our development pipeline plans" said Alex Martini, Chief Executive Officer of Blockfusion. "Our focus now is on completing the Form S-4 registration statement review process and closing the Business Combination as efficiently as possible."

The Convertible Note financing and proposed NRA are each subject to the negotiation and execution of definitive documentation and satisfaction of various conditions precedent, including, among other things, the concurrent closing of the Business Combination. The Convertible Notes, if and when such notes are issued, have not been and will not be registered under the Securities Act and may not be offered or sold in the United States absent registration or an applicable exemption from registration. Additional details regarding these arrangements will be included in the Company's and Blue's filings with the Securities and Exchange Commission (the "SEC").

Strengthening the Investment Thesis

Blockfusion and Blue believe that the developments described herein reinforce the investment thesis underlying the proposed Business Combination, highlighting Blockfusion's line of sight to securing long-term contracted demand, executing on a scalable development pipeline and delivering a capital-efficient path to growth:

Transaction Overview

Consummation of the proposed business combination transaction which is the subject of the Business Combination Agreement entered into by Blue and Blockfusion in November 2025, as amended, and as may be further amended, amended and restated or supplemented from time to time, remains subject to closing conditions customary for similar transactions, including satisfaction of minimum cash requirements at closing, approval by Blue and Blockfusion's shareholders and the satisfaction of applicable regulatory and exchange listing requirements. Upon closing, Pubco is expected to be a publicly traded, pure-play HPC and AI infrastructure platform. Additional information about the proposed transaction can be found in Blue's public filings and the registration statement on Form S-4 (as amended, and as may be further amended and supplemented from time to time, the "Registration Statement") filed by Pubco and Blockfusion with the SEC in connection with the proposed Business Combination, copies of which can be obtained free of charge from the SEC's website at www.edgar.gov.

Forward-Looking Statements