Company: ALCE
Filing Date: 2025-06-06
Form Type: 10-K
Source: 0001213900-25-052242
Chunk: 369

Company: Alternus Clean Energy, Inc.
Filing Date: 2025-06-06
Form: 10-K
Item: Item 1A
Chunk 369
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 the first and fourth quarters of each
year. Therefore, the Company expects first and fourth quarter solar revenue to be lower than in other quarters. As a result, on average,
each solar park generates approximately 15% of its annual revenues in Q1 every year, 35% in each of Q2 and Q3, and the remaining 15% in
Q4. The Company’s costs are relatively flat over the year, and so the Company will always report lower profits in Q1 and Q4 as compared
to the middle of the year.

49

Interest Rates on Company Debt

Interest rates on the Company’s senior debt
are mostly variable for the full term of the debt at interest rates ranging from 6% to 30%. The relative certainty of cash flows provides
sufficient coverage ratios.

In addition to the project specific senior debt,
the Company uses a small number of promissory notes to reduce, and in some cases eliminate, the requirement for the Company to provide
equity in the acquisition of the projects. As of December 31, 2024, 62.2% of the Company’s total liabilities were project-related
debt.

Cash Distribution Restrictions

In certain cases, the Company, through its subsidiaries,
obtain project-level or other limited or non-recourse financing for Company renewable energy facilities which may limit these subsidiaries’
ability to distribute funds to the Company for corporate operational costs. These limitations typically require that the project-level
cash is used to meet debt obligations and fund operating reserves of the operating subsidiary. These financing arrangements also generally
limit the Company’s ability to distribute funds generated from the projects if defaults have occurred or would occur with the giving
of notice or the lapse of time or both.

Renewable Energy Facility Acquisitions and
Investments

The Company’s long-term growth strategy
is dependent on its ability to acquire additional renewable power generation assets. This growth is expected to be comprised of additional
acquisitions across the Company’s scope of operations both in its current focus countries and new countries. Our operating revenues
are insufficient to fund our operations, and our assets already are pledged to secure our indebtedness to various third party secured
creditors, respectively. The unavailability of additional financing could require us to delay, scale back, or terminate our acquisition
efforts as well as our own business activities, which would have a material adverse effect on the Company and its viability and prospects.

Management believes renewable power has been one
of the fastest growing sources of electricity generation globally