Company: ALCE
Filing Date: 2025-11-03
Form Type: 10-Q
Source: 0001213900-25-105077
Chunk: 156

Company: Alternus Clean Energy, Inc.
Filing Date: 2025-11-03
Form: 10-Q
Item: Part I, Item 8
Chunk 156
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 The three levels of inputs used to measure fair value are as follows:

Level 1 — Quoted prices in active
markets for identical assets or liabilities.

Level 2 — Observable inputs other
than quoted prices included in Level 1, such as quoted prices for similar assets and liabilities in active markets; quoted prices for
identical or similar assets and liabilities in markets that are not active; or other inputs that are observable or can be corroborated
by observable market data.

Level 3 — Unobservable inputs
that are supported by little or no market activity and that are significant to the fair value of the assets or liabilities. This includes
certain pricing models, discounted cash flow methodologies and similar techniques that use significant unobservable inputs.

As
of June 30, 2025, a summary of the Company’s assets and liabilities measured at fair value on a recurring basis is as follows, in
thousands:

    Fair Value Measurement 

    Level 1  
    Level 2  
    Level 3  
    Total 
  
    Convertible Notes 
    $-  
    $-  
    $1,601  
    $1,601 
  
    Derivative Warrant Liability 
     -  
     -  
     591  
     591 
  
    Total 
    $-  
    $-  
    $2,192  
    $2,192 

Valuation Techniques

●Convertible Note (fair value
option): Valued using unobservable inputs that are not corroborated by market data (Level 3).

●Warrant Liability: Valued using
unobservable inputs that are not corroborated by market data (Level 3).

As the remaining balances
on the convertible notes issued April 19, 2024 and October 1, 2024 have identical terms and maturity dates, the Company grouped them together.
The Company measures the April 19, 2024 and October 1, 2024 convertible notes, and April 19, 2024 private placement warrants using a Monte
Carlo simulation valuation model and applying the following assumptions as of June 30, 2025:

    Convertible Loan Notes 
  
    Risk-free rate 
     3.78%
  
    Underlying stock price 
    $6.40 
  
    Expected volatility 
     55%
  
    Term 
     0.5 years 
  
    Dividend yield 
     0%

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