Company: ALCE
Filing Date: 2025-11-03
Form Type: 10-Q
Source: 0001213900-25-105077
Chunk: 172

Company: Alternus Clean Energy, Inc.
Filing Date: 2025-11-03
Form: 10-Q
Item: Part I, Item 8
Chunk 172
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 date of the Note (matures on August 5, 2025 based
on the June 30, 2025 amendment). Because the Company has been experiencing financial difficulties and because the terms of the amendments
resulted in a lower effective borrowing rate than the original Note terms, the Company has recognized the modifications as a troubled
debt restructuring (“TDR”). Due to the undiscounted cash flows on the modified debt exceeding the carrying value of the original
debt as of the modification date, no gain or loss was recorded and the Note has been adjusted to reflect the new borrowing rate implied
by the restructured cash flows from the date of the modification through the new maturity date.
As of June 30, 2025, after updating the 2024 Note to reflect the newly implied borrowing rate, the adjusted carrying value of the debt
was $1,689,894 (i.e., representing an updated face value of $1,818,182, less unamortized discount of $128,288). Refer to the Subsequent
Events Footnote 22 for information regarding additional amendments to the terms of the 2024 Note that have occurred between June 30, 2025
and the issuance date of the financial statements for the period ended June 30, 2025.

On May 29, 2025, the Company
entered into a Note Purchase Agreement (the “Purchase Agreement”), dated as of May 29, 2025, with an institutional investor
pursuant to which the Company issued a 20% Original Issue Discount promissory convertible note (the “2025 Note”) with a maturity
date in August 2025, which was extended to November 5, 2025, in the principal sum of $312,500. Pursuant to the terms of the 2025 Note,
the Company agreed to pay the entire principal amount on the Maturity Date, failing which and certain events of default (as described
in the 2025 Note), the 20% Original Issue Discount shall increase by 5% per month until the Note is fully repaid. The Purchase Agreement
contains customary representations and warranties by the Company and closed on the same date thereof. The Purchase Agreement resulted
in net proceeds of $250,000 to the Company, which the Company intends to use for working capital purposes.

The 2025 Note, issued pursuant
to the Purchase Agreement, is convertible at the option of the Holder at any time after the Maturity