Company: ALCE
Filing Date: 2025-06-30
Form Type: 10-Q
Source: 0001213900-25-059349
Chunk: 162

Company: Alternus Clean Energy, Inc.
Filing Date: 2025-06-30
Form: 10-Q
Item: Part I, Item 8
Chunk 162
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) 
     (492)
  
    Fair value movement of FPA Asset 
     -  
     (483)
  
    Gain on extinguishment of debt 
     -  
     179 
  
    Fair value movement of convertible debt 
     (806) 
     - 
  
    Fair value movement of warrant 
     811  
     - 
  
    Net Loss 
    $(2,989) 
    $(3,672)
  
    Consolidated Net Loss 
    $(180) 
    $(6,579)

19. Income Tax Provision

The Company’s provision
for income taxes for interim periods is determined using its effective tax rate expected to be applied for the full year. The Company’s
effective tax rate was 0.0% for the three months ended March 31, 2025, and 0.0%, respectively for the same period in the prior year, as
it maintains a full valuation allowance against its net deferred tax assets.

The Company assesses the realizability
of the deferred tax assets at each reporting date. The Company continues to maintain a full valuation allowance for its net deferred tax
assets. If certain substantial changes in the entity’s ownership occur, there may be an annual limitation on the amount of the carryforwards
that can be utilized. The Company will continue to assess the need for a valuation allowance on its deferred tax assets.

28

20. Related Party

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

AEG:

Alternus Energy Group Plc
(“AEG”) was a 72% shareholder as of March 31, 2024, a 48% shareholder as of December 31, 2024 and a 23% shareholder as of
March 31, 2025.

In January 2024, the Company
assumed a $938 thousand (€850 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 the Company’s restricted common stock.

During the period ended March
31, 2025, the Company and its subsidiaries and AEG and its subsidiaries had numerous financial transactions between each other which were
approved by each