Company: ALCE
Filing Date: 2025-06-06
Form Type: 10-K
Source: 0001213900-25-052242
Chunk: 720

Company: Alternus Clean Energy, Inc.
Filing Date: 2025-06-06
Form: 10-K
Item: Item 1B
Chunk 720
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 of the Company’s gross unrecognized tax benefits:

    Year Ended December 31, 

    2024  
    2023 

    (in thousands) 
  
    Unrecognized tax benefits at beginning of year 
            -  
           - 
  
    Gross increases – tax positions in prior periods 
    $360  
    $- 
  
    Gross increases – tax positions in current period 
     230  
     - 
  
    Unrecognized tax benefits at end of year 
    $590  
    $- 

Unrecognized tax benefits
are not expected to significantly increase or decrease within the next 12 months.

F-53

    25.
    Related Party

Financial assets and financial
liabilities are recognized when the Company becomes a party to the contractual provisions of the instrument.

AEG:

On October 12, 2022, AEG
entered into the Business Combination Agreement with the Company and Clean Earth Acquisition Sponsor LLC (the “Sponsor”)
which closed on December 22, 2023 (refer to Footnote 1). In conjunction with the Business Combination Agreement, AEG also entered into
an Investor Rights Agreement. The Investor Rights Agreement provides for certain governance requirements, registration rights and a lockup
agreement under which AEG is restricted from selling its shares in the Company for one year, or until December 22, 2024, other than 57,500
shares after March 22, 2024 and an additional 57,500 after June 22, 2024, provided the shares are registered under a registration statement
on SEC Form S-1. On July 31, 2024, these shares were registered. Alternus Energy Group Plc (“AEG”) was an 80% shareholder
of the Company as of December 31, 2023. As of December 31, 2024, AEG was a 48% shareholder of the Company.

In January 2024, the Company
assumed an €850 thousand ($938 thousand) convertible promissory note from AEG. The note had a 10% interest maturing in March 2025.
On January 3, 2024, the noteholder converted all of the principal and accrued interest owed under the note, equal to $1.0 million, into
52,800 shares of restricted common stock.

During the period ended December
31, 2024, the