Company: ALCE
Filing Date: 2025-06-06
Form Type: 10-K
Source: 0001213900-25-052242
Chunk: 2466

Company: Alternus Clean Energy, Inc.
Filing Date: 2025-06-06
Form: 10-K
Item: Item 7A
Chunk 2466
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 respectively.

As of December 31, 2022, the
Company’s wholly owned subsidiary, Solis Bond Company DAC, was in breach of the three financial covenants under Solis’ Bond
terms: (i) the minimum Liquidity Covenant that requires the higher of €5.5 million or 5% of the outstanding Nominal Amount, (ii)
the minimum Equity Ratio covenant of 25%, and (iii) the Leverage Ratio of NIBD/EBITDA to not be higher than 6.5 times for the year ended
December 2021, 6.0 times for the year ended December 31, 2022 and 5.5 times for the period ending on the maturity date of the Bond, January
6, 2024. The Solis Bond carries a 3 months EURIBOR plus 6.5% per annum interest rate, and has quarterly interest payments, with a bullet
payment to be paid on January 6, 2024. The Solis Bond is senior secured through a first priority pledge on the shares of Solis and its
subsidiaries, a parent guarantee from Alternus Energy Group Plc, and a first priority assignment over any intercompany loans.

F-34

In April 2023 the bond holders
approved a temporary waiver and an amendment to the bond terms to allow for a change of control in Solis (which allows for the transfer
of Solis and its subsidiaries underneath Clean Earth Acquisitions Corp. on Closing). In addition, bondholders received a preference share
in an Alternus Midco, which will hold certain development projects in Spain and Italy. The shares will have preference on any distribution
from Midco to Alternus up to €10.0 million, and Midco will divest assets to ensure repayment of the €10.0 million should the
bonds not have been fully repaid at maturity (January 6, 2024). Finally, bondholders will receive a 1% amendment fee, which equates to
€1.4 million.

On June 5, 2023, the bondholders
approved an extension to the waiver to September 30, 2023 and the bond trustee was granted certain additional information rights and the
right to appoint half of the members of the board of directors of Solis, in addition to the members of the board appointed by Alternus.
Under the waiver agreement, as extended, Solis must fully repay the Solid Bond