ACLEW 8-K
Alternus Clean Energy, Inc. (ACLEW)
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
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Item 1.01. Entry into a Material Definitive Agreement.
On September 30, 2025, Alternus Clean Energy, Inc. (the “Alternus” or the “Company”) entered into and closed a Securities Purchase Agreement (“SPA”) and a Joint Venture Operating Agreement (“JVOA”) with Hover Energy LLC (“Hover”), a Delaware company engaged in the business of developing, manufacturing and deploying distributed generation renewable energy projects featuring Hover wind powered generators together with varied generation and storage technologies (“Microgrid Projects”), pursuant to which Alternus sold a 49% interest in its subsidiary, EverOn Energy LLC (the “JV”) to Hover, and issued 20,000 shares of the Company’s Series B Convertible Preferred Stock (the “Series B”) to Hover, in exchange for which Hover contributed certain Microgrid Projects to the JV, including related supply and management services agreements to be entered into with the JV (together, the transaction hereinafter shall be referred to as the “Joint Venture”).
Additionally, one of the Company’s subsidiaries, Alt Alliance LLC, entered into a Settlement Agreement with Hover related to the termination of the Strategic Alliance Agreement dated October 31, 2023 (“SAA”) as the Joint Venture has superceded the SAA. As part of the settlement, the Company agreed to repay the total outstanding amount of $5,150,000 owed to Hover under the SAA through the following methods: i) $1,150,000 through the issuance of 1,150 shares of Series B, ii) $1,700,000 by Southern Point Capital through the settlement agreement and stipulation as previously disclosed in the Company’s SEC Current Report on Form 8-k filed on May 2, 2025, and iii) the remaining amount to be repaid in cash by the Company as mutually agreed upon by both parties from time to time.
The Company has determined the fair value of the Series B issued to Hover to be $1,000 per share, for an aggregate consideration value of approximately $21 million. The Joint Venture brings in a substantial pipeline of Wind Powered Microgridstm projects and clients in the UK and the US, and the Company believes that the Joint Venture will immediately improve Company’s stockholder’s equity. The Company has initially valued the future revenue streams and income from these projects at over $50 million, subject to third party valuation. The transaction represents a material acquisition exceeding 20 percent of the Company’s consolidated assets, requiring the filing of an amendment to this Form 8-K with financial statements and pro forma financial information pursuant to Item 9.01 of Form 8-K within 75 days.
The foregoing description of the Series B, SPA, JVOA and Settlement Agreement does not purport to be complete and is qualified in its entirety by reference to the full text, a copy of which is filed as Exhibit 3.1, 10.1, 10.2 and 10.3, respectively, to this Current Report on Form 8-K and which is incorporated by reference herein in its entirety.
Item 2.01. Completion of Acquisition or Disposition of Assets.
The information provided in Item 1.01 is hereby incorporated by reference.
Item 3.03. Material Modification to Rights of Security Holders.
The disclosure set forth in Item 1.01 and 5.03 below is hereby incorporated herein by reference.
Item 5.03. Amendments to Articles of Incorporation or Bylaws; Change in Fiscal Year.
Series B Convertible Preferred Stock
On September 30, 2025, the board of directors (the “Board”) of the Company declared the formation of, and approved the issuance of, an aggregate of 21,150 shares of Series B Convertible Preferred Stock, par value $0.0001 per share (“Series B”). The Company filed a certificate of designation (the “Certificate of Designation”) with the Secretary of State of the State of Delaware therein establishing the Series B Convertible Preferred Stock and describing the rights, obligations and privileges of the Series B. Concurrently, the Company issued 21,150 shares of Series B to Hover on the same date, in book-entry form. The following description of the Series B does not purport to be complete and is qualified in its entirety by reference to the Certificate of Designation, which is filed as Exhibit 3.1 to this Current Report and is incorporated herein by reference.
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General. The Series B consists of 21,150 shares. Each share of Series B has a par value of $0.0001 per share and a value of $1,000 per share. The Series B has no stated maturity and is not subject to any sinking fund.
Conversion Right. Each share of Series B shall convert into a number of fully paid and non-assessable shares of Common Stock equal to the value of each share ($1,000) divided by the Conversion Price in effect at the time of conversion, at the option of the Holder, at or after the earlier of (i) six months after the Company’s uplisting to a national exchange (the “Uplist”), or (ii) if no Uplist has occurred within the first nine months, then nine months from the Original Issue Date. The Conversion Price is $1.00 per share, subject to adjustment in accordance with the Certificate of Designation. The Series B ranks senior to the Company’s Series A Super Voting Preferred Stock and pari passu with the Company’s common stock with respect to rights upon liquidation
Adjustments of Conversion Price. If, from the Original Issue Date to December 31, 2026, the Company has issued any shares of Common Stock or convertible preferred stock (or any securities convertible into or exercisable for Common Stock) at a price per share less than the then-effective Conversion Price (the "Original Conversion Price") of the Series B (a "Dilutive Issuance"), then the Original Conversion Price shall be reduced to the lowest price per share of Common Stock or convertible preferred stock issued during this period.
Restriction on Conversion. In no event shall the Holder have the right or the Company be required to convert, as applicable, shares of Series B if as a result of such conversion the aggregate number of shares of Common Stock beneficially owned by such Holder and its Affiliates and any other persons whose beneficial ownership of Common Stock would be aggregated with the shareholder for purposes of Section 13(d) of the 1934 Act, would exceed 19.99% of the outstanding shares of the Common Stock following such conversion.
Restriction on Sales. Beginning on the month after the Holder is able to convert the Series B and utilize an exemption under SEC Rule 144, the Holder may sell a maximum amount of Common Shares per month not to exceed the average daily volume of the Company’s common stock in the prior month.
Voting Rights. Each holder of Series B has full voting rights and powers equal to the voting rights and powers of holders of common stock, and for so long as Series B is issued and outstanding, the holders of Series B shall vote together as a single class with the holders of the Company’s common stock and the holders of any other class or series of shares entitled to vote on all such matters equal to the number of whole shares of Common Stock into which the shares of Series B Preferred Stock held by such holder are convertible as of the record date for determining stockholders entitled to vote on such matter. (For avoidance of doubt, voting rights are on an ‘as-converted’ basis.)
Dividend Rights. The holders of Series B, as such, will not be entitled to receive dividends of any kind.
Liquidation Preference. The holders of Series B shall be entitled to receive distributions in the event of any liquidation, dissolution or winding up of the Company pari passu with the Common Stock.
Item 8.01. Other Events.
The transactions described in Item 1.01 of this Current Report on Form 8-K constitute a material acquisition of assets representing more than 20 percent of the consolidated assets of the Company, as determined pursuant to Rule 3-05 of Regulation S-X. As such, the Company is required to provide the financial statements of the acquired business and the related pro forma financial information required under Item 9.01(a) and (b) of Form 8-K. The Company intends to file an amendment to this Current Report on Form 8-K (sometimes referred to as a “Super 8-K”) no later than 75 days after the date on which this Current Report was required to be filed, to include such financial statements and pro forma financial information.
The Company has determined that each share of its Series B issued in connection with the Hover Joint Venture has a stated value of $1,000 per share, for an aggregate value of $21,150,000 for all 21,150 shares issued on September 30, 2025.
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Forward Looking Statements
All statements contained in this Current Report on Form 8-K other than statements of historical facts, including any information on the Company’s plans or future financial or operating performance and other statements that express the Company’s management’s expectations or estimates of future performance, constitute forward-looking statements. Forward-looking statements may be identified by the use of words such as “anticipate,” “believe,” “continue,” “could,” “estimate,” “expect,” “intend,” “may,” “might,” “plan,” “possible,” “potential,” “predict,” “project,” “should,” “would” and similar expressions, as they relate to the Company or its management team. Such forward-looking statements are based on the beliefs of management, as well as assumptions made by, and information currently available to, the Company’s management. Such statements are based on a number of estimates and assumptions that are subject to significant business, economic and competitive uncertainties, many of which are beyond the control of the Company. The Company cautions that such forward-looking statements involve known and unknown risks and other factors that may cause the actual financial results, performance or achievements of the Company to differ materially from the Company’s estimated future results, performance or achievements expressed or implied by the forward-looking statements. These statements should not be relied upon as representing the Company’s assessments of any date after the date of this Current Report on Form 8-K. The Company undertakes no obligation to update these statements for revisions or changes after the date of this release, except as required by law.
Item 9.01. Financial Statements and Exhibits.
(d) Exhibits.
| Exhibit No. | Description | |
| 3.1 | Certificate of Designation of Series B Convertible Preferred Stock, dated September 30, 2025 | |
| 10.1 | Joint Venture Operating Agreement, by and among Alternus Clean Energy Inc. and Hover Energy LLC dated September 30, 2025 | |
| 10.2 | Securities Purchase Agreement dated September 30, 2025 | |
| 10.3 | Settlement Agreement dated September 30, 2025 | |
| 104 | Cover Page Interactive Data File (embedded within the Inline XBRL document) |
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Date: October 6, 2025 | ALTERNUS CLEAN ENERGY, INC. | |
| By: | /s/ Vincent Browne | |
| Name: | Vincent Browne | |
| Title: | Chief Executive Officer, Interim Chief Financial Officer and Chairman of the Board of Directors | |
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Exhibit 3.1
CERTIFICATE OF DESIGNATION
OF
SERIES B CONVERTIBLE PREFERRED STOCK
OF
ALTERNUS CLEAN ENERGY, INC.
Alternus Clean Energy, Inc., a Delaware corporation (the “Company”) certifies that pursuant to the authority contained in ARTICLE IV of its Certificate of Incorporation, as amended (the “Certificate of Incorporation”), the Board of Directors of the Company (the “Board of Directors”), by unanimous written consent in lieu of a meeting effective September 30, 2025, duly approved and adopted the following resolution, which resolution remains in full force and effect on the date hereof:
RESOLVED, that pursuant to the authority vested in the Board of Directors by the Certificate of Incorporation, the Board of Directors does hereby authorize and provide for the issue of a series of preferred stock, having a par value of $0.0001 per share, which shall be designated as Series B Convertible Preferred Stock, and which shall have the voting powers, designations, preferences, limitations, restrictions, and relative rights as follows:
CERTIFICATE OF DESIGNATION OF
SERIES B CONVERTIBLE PREFERRED STOCK
OF ALTERNUS CLEAN ENERGY, INC.
1. Designation, Amount and Rank.
a. The Preferred Stock authorized under this Certificate of Designation shall be designated as the Series B Convertible Preferred Stock (the “Series B Convertible Preferred”), and the number of shares so designated shall be 21,150 having a value of One Thousand Dollars ($1,000.00) per share and $0.0001 par value per share and, subject to adjustment for any stock splits, stock dividends or similar transactions affecting the Series B Convertible Preferred or the underlying Common Stock, and which number shall not be subject to increase without the consent of each holder of the Series B Convertible Preferred (each, a “Holder”, and collectively, the “Holders”).
b. The Series B Convertible Preferred shall, with respect to dividends and distributions upon liquidation, dissolution or winding up of the Company, rank senior to the Series A Super Voting Preferred Stock, pari passu with all classes of Common Stock (the “Parity Securities”) and junior to any other series of Preferred Stock that is not, expressly by its terms, made junior to the Series B Convertible Preferred.
2. Dividends. The Holders of the Series B Convertible Preferred shall not be entitled to receive any dividend payment.
3. Voting Rights. On any matter presented to the stockholders of the Corporation for their action or consideration at any meeting of stockholders of the Corporation (or by written consent of stockholders in lieu of meeting), each holder of outstanding shares of Series B Preferred Stock shall be entitled to cast the number of votes equal to the number of whole shares of Common Stock into which the shares of Series B Preferred Stock held by such holder are convertible as of the record date for determining stockholders entitled to vote on such matter. (For avoidance of doubt, voting rights are on an ‘as-converted’ basis.) Except as provided by law or by the other provisions of the Certificate of Incorporation, holders of Series B Preferred Stock shall vote together with the holders of Common Stock as a single class.
4. Liquidation.
a. Upon any liquidation, dissolution or winding up of the Corporation, whether voluntary or involuntary (“Liquidation”), the holders of record of the shares of the Series B Preferred Stock shall be entitled to receive assets and funds on parity with the Parity Securities. If, upon such Liquidation, the assets of the Corporation available for distribution to the holders of Series B Preferred Stock and any Parity Securities shall be insufficient to permit payment in full to the holders of the Series B Preferred Stock and Parity Securities, then the entire assets and funds of the Corporation legally available for distribution to such holders and the holders of the Parity Securities then outstanding shall be distributed ratably among the holders of the Series B Preferred Stock and Parity Securities based upon the proportion the total amount distributable on each share upon Liquidation bears to the aggregate amount required to be distributed, but for the provisions of this sentence, on all shares of the Series B Preferred Stock, on an as converted basis, and of such Parity Securities.
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b. The Company shall mail written notice of any such Liquidation, not less than 45 days prior to the payment date stated therein, to each Holder.
5. Mechanics of Conversion.
a. Holder’s Conversion Rights. Each single one (1) share of Series B Preferred shall convert into a number of fully paid and non-assessable shares of Common Stock equal to the value of each share (provided in Section 1a) divided by the Conversion Price in effect at the time of conversion as defined below, at the option of the Holder thereof at or after the earlier of (i) six months after the Company’s uplisting to a national exchange (the “Uplist”), or (ii) if no Uplist has occurred within the first nine months, then nine months from the Original Issue Date. The Conversion Price shall be $1.00 per share, subject to adjustment in accordance with this Certificate of Designation (the “Conversion Price”).
b. A Holder shall effect conversions by surrendering to the Company the certificate or certificates representing the shares of Series B Preferred to be converted, together with a copy of the form of conversion notice attached hereto as Exhibit A (the “Conversion Notice”). Each Conversion Notice shall specify the Holder, the number of shares of Series B Preferred to be converted and the date on which such conversion is to be effected, which date may not be prior to the date the Holder delivers such Conversion Notice by electronic mail (the “Conversion Date”). If no Conversion Date is specified in a Conversion Notice the Conversion Date shall be the date that the Conversion Notice is deemed delivered pursuant to Section 11. Subject to Section 5(b) hereof, each Conversion Notice, once given, shall be irrevocable.
c. Restriction on Conversion by Either the Holder(s) or the Company. Notwithstanding anything herein to the contrary, in no event shall the Holder(s) have the right or the Company be required to convert, as applicable, shares of Series B Preferred if as a result of such conversion the aggregate number of shares of Common Stock beneficially owned by such Holder(s) and its Affiliates and any other persons whose beneficial ownership of Common Stock would be aggregated with the shareholder(s) for purposes of Section 13(d) of the 1934 Act, would exceed 19.99% of the outstanding shares of the Common Stock following such conversion (including for such purpose the shares of Common Stock issuable upon such conversion). For purposes of this Section, beneficial ownership shall be calculated in accordance with Section 13(d) of the Securities Exchange Act of 1934, as amended, and the rules and regulations promulgated thereunder. The limitations contained in this paragraph shall apply to a successor Holder of Preferred Stock. If the Company is restricted pursuant to this paragraph, the Company shall convert shares of Series B Convertible Preferred on the next available trading day after such beneficial ownership has fallen below 19.99%.
6. Restriction on Sales by the Holders. Beginning on the month after the Holder is able to convert the Series B Convertible Preferred Stock and utilize an exemption under SEC Rule 144, the Holder(s) may sell a maximum amount of Common Shares per month not to exceed the average daily volume of the Company’s common stock in the prior month.
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The Holder(s) shall deliver third party brokerage reports providing all the Holder(s) sales information on the Company’s Common Stock (“Sales Reports”) and the Holder(s) beneficial ownership reports to the Company prior to or concurrent with each Conversion Notice and on a monthly basis as soon as such reports are available. If the Sales Reports are not received by the Company in accordance with the above schedule, the Company has the right to disregard any subsequent Conversion Notice(s) until such Sales Reports are properly provided to the Company.
7. Reservation of Shares. The Company covenants that it will at all times reserve and keep available out of its authorized and unissued Common Stock, solely for the purpose of issuance upon conversion of the Series B Convertible Preferred and free from preemptive rights or any other actual contingent purchase rights of Persons other than the Holders of Series B Convertible Preferred , not less than 100% of such number of shares of Common Stock as shall be issuable (taking into account the adjustments of Section 8) upon the conversion of all outstanding shares of Series B Convertible Preferred (without regard to any limitations on conversion). The Company shall, from time to time in accordance with Delaware law, take all steps necessary to increase the authorized amount of its Common Stock if at any time the authorized number of shares of Common Stock remaining unissued shall not be sufficient to permit the conversion of all of the shares of the Series B Convertible Preferred. The Company covenants that all shares of Common Stock that shall be so issuable shall, upon issue, be duly authorized, validly issued, fully paid and non-assessable.
8. Adjustment of Conversion Price.
a. Down Round Anti-Dilution Protection. If, from the Original Issue Date to December 31, 2026, the Company has issued any shares of Common Stock or convertible preferred stock (or any securities convertible into or exercisable for Common Stock) at a price per share less than the then-effective Conversion Price (the “Original Conversion Price”) of the Series B Preferred Stock (a “Dilutive Issuance”), then the Original Conversion Price shall be reduced to the lowest price per share of Common Stock or convertible preferred stock issued during this period.
b. Common Stock Dividends; Common Stock Splits; Reclassification. If the Company, at any time after the Original Issue Date shall (a) subdivide outstanding shares of Common Stock into a larger or smaller number of shares or (b) issue by reclassification of shares of Common Stock any shares of capital stock of the Company, then the Conversion Price shall be multiplied by a fraction, the numerator of which shall be the number of shares of Common Stock outstanding before such event and the denominator of which shall be the number of shares of Common Stock outstanding after such event. Any adjustment made pursuant to this Section 8(b) shall become effective immediately after the record date for the determination of shareholders entitled to receive such dividend or distribution and shall become effective immediately after the effective date in the case of a subdivision or re-classification.
Simultaneously with any adjustment to the Conversion Price, the number of shares of Common Stock that may be purchased upon conversion of the Series B Convertible Preferred Stock shall be increased or decreased proportionately, so that after such adjustment the aggregate Conversion Price payable hereunder for the adjusted number of Common Shares shall be the same as the aggregate Conversion Price in effect immediately prior to such adjustment (without regard to any limitations on conversion contained herein).
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c. Rounding. All calculations under this Section 8 shall be made to the nearest cent or the nearest l/l00th of a share, as the case may be.
d. Notice of Adjustment. Whenever the Conversion Price is adjusted pursuant to this Section 7 the Company shall promptly mail to the Holders a notice setting forth the Conversion Price after such adjustment and setting forth a brief statement of the facts requiring such adjustment. Such notice shall be signed by the chairman, president or chief financial officer of the Company.
e. Notice of Certain Events. If:
(i) the Company shall declare a dividend (or any other distribution) on its Common Stock;
(ii) the Company shall declare a special nonrecurring cash dividend on or a redemption of its Common Stock;
(iii) the Company shall authorize the granting to the holders of its Common Stock rights, options or warrants to subscribe for or purchase any shares of capital stock of any class or of any rights;
(iv) the approval of any shareholders of the Company shall be required in connection with any reclassification of the Common Stock, any consolidation or merger to which the Company is a party, any sale or transfer of all or substantially all of the assets of the Company, or any compulsory share exchange whereby the Common Stock is converted into other securities, cash or property; or
(v) the Company shall authorize the Liquidation of the affairs of the Company;
then the Company shall cause to be filed at each office or agency maintained for the purpose of the conversion of the Series B Convertible Preferred , and shall cause to be delivered to the Holders at the address specified herein, at least 30 (thirty) calendar days prior to the applicable record or effective date hereinafter specified, a notice (provided such notice shall not include any material non-public information) stating (a) the date on which a record is to be taken for the purpose of such dividend, distribution, redemption, or granting of options, rights or warrants, or if a record is not to be taken, the date as of which the holders of Common Stock of record to be entitled to such dividend, distributions, redemption, rights, options or warrants are to be determined or (b) the date on which such reclassification, consolidation, merger, sale, transfer or share exchange is expected to become effective or close, and the date as of which it is expected that holders of record of Common Stock shall be entitled to exchange their shares of Common Stock for securities, cash or other property deliverable upon such reclassification, consolidation, merger, sale, transfer or share exchange; provided, however, that the failure to mail such notice or any defect therein or in the mailing thereof shall not affect the validity of the corporate action required to be specified in such notice. Nothing herein shall prohibit the Holders from converting shares of Series B Convertible Preferred held by such Holder during the 30-day period commencing on the date of such notice to the effective date of the event triggering such notice.
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9. Transferability. The holders of the Series B Convertible Preferred shall be entitled, at their option and at any time, to transfer the Series B Convertible Preferred to a third party, provided that such third party is an accredited investor and shall accept all terms and conditions set forth in this Designation of Series B Convertible Preferred Stock.
10. Redemption. Neither the Corporation nor the holders of the Series B Preferred Stock shall have any right at any time to require the redemption of any of the shares of Series B Preferred Stock, except upon and by reason of any liquidation, dissolution or winding-up of the Corporation, as and to the extent herein provided.
11. Definitions. For the purposes hereof, the following terms shall have the following meanings:
“Affiliate”
of any Person means any other Person directly or indirectly controlling or controlled by or under direct or indirect common control with
such Person. For the purposes of this definition, “control” when used with respect to any Person means the possession, directly
or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through ownership
of voting securities, by contract or otherwise; and the terms
“controlling” and “controlled” have meanings correlative to the foregoing.
“Common Stock” means the Company’s common stock, $.0001 par value per share, and stock of any other class into which such shares may hereafter have been reclassified or changed.
“Original Issue Date” shall mean the date of the first issuance of any shares of the Series B Convertible Preferred, regardless of the number of transfers of any particular shares of Series B Convertible Preferred and regardless of the number of certificates which may be issued to evidence such Series B Convertible Preferred .
“Person” means a corporation, an association, a partnership, organization, a business, an individual, a government or political subdivision thereof or a governmental agency.
“Underlying Shares” means the number of shares of Common Stock into which the Series B Convertible Preferred are convertible in accordance with the terms hereof.
“Per Share Market Price” means on the date the Conversion Notice is received by the Company (the “Date”), the closing price of the Common Stock on such exchange, quotation system or over-the-counter market, and provided that all determinations of the Per Share Market Price shall be appropriately adjusted for any stock dividends, stock splits or other similar transactions during such period.
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12. Notices. Except as otherwise provided in the event of conversion of shares of Series B Convertible Preferred, all notices or other communications required hereunder shall be in writing and shall be deemed to have been received (a) upon hand delivery (receipt acknowledged) or delivery by electronic mail (with confirmation) at the email address designated below (if received by 6:00 p.m. EST where such notice is to be received), or the first business day following such delivery (if received after 6:00 p.m. EST where such notice is to be received) or (b) on the second business day following the date of mailing by express courier service, fully prepaid, addressed to such address, or upon actual receipt of such mailing, whichever shall first occur; and shall be regarded as properly addressed if sent to (i) the Company, to Alternus Clean Energy, Inc., 17 State Street, Suite 4000, New York, NY 10004, email: [email protected] and (ii) if the Holder, at its respective addresses set forth in the books and records of the Company, or such other address as any of the above may have furnished to the other parties in writing by registered mail, return receipt requested.
13. Lost or Stolen Certificates. Upon receipt by the Company of evidence reasonably satisfactory to the Company of the loss, theft, destruction or mutilation of any stock certificates representing the shares of Series B Convertible Preferred, and, in the case of loss, theft or destruction, of any indemnification undertaken by the Holder to the Company in customary form and, in the case of mutilation, upon surrender and cancellation of such Series B Convertible Preferred stock certificate(s), the Company shall execute and deliver new preferred stock certificate(s) of like tenor and date; provided, however, the Company shall not be obligated to re-issue preferred stock certificates if the Holder contemporaneously requests the Company to convert such Series B Convertible Preferred into Common Stock.
14. Remedies Characterized; Other Obligations, Breaches and Injunctive Relief. The remedies provided in this Certificate of Designation shall be cumulative and in addition to all other remedies available under this Certificate of Designation, at law or in equity (including a decree of specific performance and/or other injunctive relief), but not including the Subscription Agreement, whose terms, conditions and remedies shall not be a part of the rights of the Holders as holders of Series B Convertible Preferred . No remedy contained herein shall be deemed a waiver of compliance with the provisions giving rise to such remedy and nothing herein shall limit a Holder’s right to pursue actual damages for any failure by the Company to comply with the terms of this Certificate of Designation. The Company covenants to each Holder of Series B Convertible Preferred that there shall be no characterization concerning this instrument other than as expressly provided herein. Amounts set forth or provided for herein with respect to payments, conversion and the like (and the computation thereof) shall be the amounts to be received by the Holder thereof and shall not, except as expressly provided herein, be subject to any other obligation of the Company (or the performance thereof). The Company acknowledges that a breach by it of its obligations hereunder will cause irreparable harm to the Holders of the Series B Convertible Preferred and that the remedy at law in the event of any such breach may be inadequate. The Company therefore agrees that, in the event of any such breach or threatened breach, the Holders of the Series B Convertible Preferred shall be entitled, in addition to all other available remedies, to an injunction restraining any breach, without the necessity of showing economic loss and without any bond or other security being required.
15. Specific Shall Not Limit General; Construction. No specific provision contained in this Certificate of Designation shall limit or modify any more general provision contained herein. This Certificate of Designation shall be deemed to be jointly drafted by the Company and all Holders and shall not be construed against any Person as the drafter hereof.
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16. Failure or Indulgence Not Waiver. No failure or delay on the part of a Holder of Series B Convertible Preferred in the exercise of any power, right or privilege hereunder shall operate as a waiver thereof, nor shall any single or partial exercise of any such power, right or privilege preclude other or further exercise thereof or of any other right, power or privilege.
17. Fractional Shares. Upon a conversion hereunder, the Company shall not be required to issue stock certificates representing fractions of shares of Common Stock, but may if otherwise permitted, make a cash payment in respect of any final fraction of a share based on the Per Share Market Value at such time. If the Company elects not, or is unable, to make such a cash payment, the Holder of a share of Series B Convertible Preferred shall be entitled to receive, in lieu of the final fraction of a share, one whole share of Common Stock.
18. Payment of Tax Upon Issue of Transfer. The issuance of certificates for shares of the Common Stock upon conversion of the Series B Convertible Preferred Shares shall be made without charge to the Holders thereof for any documentary stamp or similar taxes that may be payable in respect of the issue or delivery of such certificate, provided that the Company shall not be required to pay any tax that may be payable in respect of any transfer involved in the issuance and delivery of any such certificate upon conversion in a name other than that of the Holders so converted, and the Company shall not be required to issue or deliver such certificates unless or until the Person or Persons requesting the issuance thereof shall have paid to the Company the amount of such tax or shall have established to the satisfaction of the Company that such tax has been paid.
19. Shares Owned by Company Deemed Not Outstanding. In determining whether the Holders of the outstanding shares of Series B Convertible Preferred have concurred in any direction, consent or waiver under this Certificate of Designation, shares of Series B Convertible Preferred which are owned by the Company or any other obligor thereof shall be disregarded and deemed not to be outstanding for the purpose of any such determination; provided, that any Series B Convertible Preferred owned by the Holders shall be deemed outstanding for purposes of making such a determination. Shares of the Series B Convertible Preferred so owned which have been pledged in good faith may be regarded as outstanding if (i) the pledgee establishes to the satisfaction of the Holders and the Company the pledgee’s right so to act with respect to such shares and (ii) the pledgee is not the Company or any other obligor of the Company.
20. Communications. The holders of the Series B Convertible Preferred shall be entitled to receive, and the Company shall deliver pursuant to Section 11 hereof, all communications sent by the Company to the holders of the Common Stock.
21. Reacquired Shares. Any shares of Series B Convertible Preferred purchased, converted or otherwise acquired by the Company in any manner whatsoever shall not be reissued as part of the Company’s Series B Convertible Preferred and shall be retired promptly after the acquisition thereof. All such shares shall become, upon their retirement (and the filing of any certificate required in connection therewith pursuant to the General Corporation Law of the state of Delaware), authorized but unissued shares of Preferred Stock.
22. Effect of Headings. The section headings herein are for convenience only and shall not affect the construction hereof.
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IN WITNESS WHEREOF, Alternus Clean Energy, Inc. has caused this Certificate of Designation to be signed by its Chief Executive Officer on this 30th day of September, 2025.
| By: | /s/ Vincent Browne | |
| Name: | Vincent Browne | |
| Title: | Chief Executive Officer |
EXHIBIT A
NOTICE OF CONVERSION
AT THE ELECTION OF HOLDER
| (To be Executed by the Registered Holder in order to Convert shares of Series B Convertible Preferred Stock) |
The undersigned hereby elects to convert the number of shares of Series B Convertible Preferred Stock indicated below, into shares of common stock, par value $0.0001 per share (the “Common Stock”), of Alternus Clean Energy, Inc. (the “Company”) according to the conditions hereof, as of the date written below. If shares are to be issued in the name of a person other than undersigned, the undersigned will pay all transfer taxes payable with respect thereto and is delivering herewith such certificates and opinions as reasonably requested by the Company in accordance therewith. No fee will be charged to the Holder for any conversion, except for such transfer taxes, if any.
| Conversion calculations: | |
| ________________________________________________________ | |
| Date to Effect Conversion | |
| ________________________________________________________ | |
| Number of shares of Series B Preferred Stock to be Converted | |
| ________________________________________________________ | |
| Number of shares of Common Stock to be Issued | |
| ________________________________________________________ | |
| Applicable Conversion Price | |
| ________________________________________________________ | |
| Name of Person to whom Shares of Common Stock are to be Issued | |
| ________________________________________________________ | |
| Signature | |
| ________________________________________________________ | |
| Name | |
| ________________________________________________________ | |
| Address | |
| ________________________________________________________ | |
| US Tax ID Number |
Exhibit 10.1
OPERATING AGREEMENT
of
EverOn Energy LLC
This OPERATING AGREEMENT (this “Operating Agreement” or the “Agreement”) of EverOn Energy LLC, a Delaware limited liability company (the “Company” or the “JV”), dated as of September 30, 2025, is entered into by and among Hover Energy, LLC, a Delaware limited liability company (“Hover”), and Alternus Clean Energy Inc. (“Alternus”), and any other person who, after the date hereof, becomes a Member in accordance with the terms of this Operating Agreement (collectively with Hover and Alternus, the “Members”).
RECITALS
WHEREAS, Hover is in the business of i) developing distributed generation renewable energy projects featuring Hover wind turbines together with varied generation and storage technologies (“Microgrid Projects”) and ii) manufacturing and deploying proprietary wind turbine technology;
WHEREAS, Alternus is in the business of financing, management and operation of renewable energy projects;
WHEREAS, Hover owns or controls certain Microgrid Projects in various stages of development, more fully described on Exhibit A attached hereto and made a part hereof, (each, an “Initial Projects” and together, the “Initial Project Pipeline”), which Hover shall contribute to the Company on the Effective Date of this Agreement;
WHEREAS, Each of Alternus or Hover may mutually agree in writing with the JV to transfer to the JV for development Microgrid Projects that they originate and/or obtain control of in the course of their business after the Effective Date hereof (each a “Future Project”);
WHEREAS, On the Effective Date the Members entered into a membership purchase agreement whereby Alternus sold 49% of the Membership Interests in the Company to Hover (the “MIPA”); Following the execution of the MIPA, the entire issued and outstanding Membership Interest of the Company shall be held by the Members as follows: 49% owned by Hover and 51% owned by Alternus;
WHEREAS, Hover entered into a Strategic Alliance Ageement with an affiliate of Alternus (Alt Alliance LLC) on October 31, 2023, which provided for the provision of certain project evaluation and development services to Alt Alliance by Hover, which the parties intend to replace in its entirety with this JV. ;
WHEREAS, the Members wish to jointly finance and develop all Future Projects and Initial Projects (together, the “JV Projects”), based on a develop-to-own and/or develop-to-sell model;and
WHEREAS, the Members believe it to be advisable and in the best interests of the Company and the Members, for the purpose of creating provisions for the continuity and stability of the business and policies of the Company, to set forth its agreement with respect to the interests owned by the Members and the operations of the Company.
NOW, THEREFORE, in consideration of the mutual covenants contained herein and for other good and valuable consideration the receipt and sufficiency of which is hereby acknowledged, the Members hereby agree as follows:
Article
I
The Company
1.1 Formation. Alternus has formed the Company for this purpose, as a limited liability company pursuant to, and in accordance with, the Delaware Limited Liability Company Act (6 Del. C. §§ 18-101 et seq.), as amended from time to time (the “Act”), by the filing of a certificate of formation of the Company with the Secretary of State of the State of Delaware. Upon the effectiveness of this Operating Agreement, the Managers (as provided for in Article III) and any other person designated by the Managers is hereby designated an “authorized person” within the meaning of the Act to execute, deliver and file, or cause the execution, delivery and filing of, all certificates (and any amendments and/or restatements thereof) required or permitted by the Act to be filed with the Office of the Secretary of State of the State of Delaware.
1.2 Name. The name of the Company shall be “EverOn Energy LLC” and its business shall be carried on in such name with such variations and changes as the Board of Managers (as hereinafter defined) shall determine or deem necessary to comply with requirements of the jurisdictions in which the Company’s operations are conducted.
1.3 Business Purpose; Powers. The Company is formed for the purpose of i) financing and developing the JV Projects, and ii) engaging in such lawful activity for which limited liability companies may be formed, and exercising all powers and privileges now or hereafter granted to a limited liability company, under the Act, and doing any and all acts and things necessary, convenient, desirable or incidental to the foregoing purposes. The rights, powers, duties, obligations and liabilities of the Members and Managers (as hereinafter defined) and the Company will be determined in accordance with the Act and this Operating Agreement. To the extent that the rights, powers, duties, obligations and liabilities of any of the Member, the Managers and the Company are different by reason of any provision of this Operating Agreement than they would be under the Act in the absence of such provision, then this Operating Agreement shall control to the extent permitted by the Act.
| Operating Agreement – EverOn Energy LLC | ||
| 1 |
1.4 Registered Office and Agent. The location of the registered office of the Company in the State of Delaware is 16192 Coastal Highway, Lewes, DE 19958. The Company’s registered agent at such address shall be Harvard Business Services.
1.5 Offices. The principal business office of the Company shall be located at such place within or outside the State of Delaware as the Managers may from time to time designate.
1.6 Term. Subject to the provisions of Article VI below, the Company shall have perpetual existence.
1.7 Entity Classification. It is the intent of the Company and the Members that the Company shall be treated as a partnership for US, federal, state, and local income tax purposes. Neither any Manager nor any Member shall make any election for the Company to be classified as other than a partnership pursuant to Treasury Regulations Section 301.7701-3.
1.8 Company Subsidiaries. The JV shall incorporate two wholly owned subsidiaries, a US LLC and a UK LLC (the “Local OpCos”); and the JV Projects shall ultimately be held, developed, and financed by the Local OpCos or their dedicated wholly owned SPVs; the US LLC will hold JV Projects and their assets located in the US, and the UK LLC will hold JV Projects and their assets located in the UK. The JV and its Managers shall ensure that i) the Local OpCos shall be wholly owned and managed by the JV, ii) shall have no managers, directors or officers except for the JV, and iii) shall adopt Operating Agreements consistent with the JV’s project development obligaations described herein, including but not limited to Article IV hereof.
Article
II
Members; CAPITAL STRUCTURE AND CONTRIBUTION
2.1 Capital Structure. The capital structure of the Company consists of one class of limited liability company interests (the “Membership Interests”). All Membership Interests shall be identical with each other in every respect. As of the Effective Date of this Agreement and the MIPA, each of the Members owns that percentage of the Company’s issued and outstanding unit Membership Interests set forth on Exhibit C attached hereto opposite each Member’s name.
2.2 Capital Contributions.
(a) Hover Contribution. As of the Effective Date of this Agreement and the MIPA, Hover has made a capital contribution consisting of the Initial Projects and Pipeline as set forth in Exhibit A, and Alternus has made a capital contribution consisting of the OASIS software.
(b) No Member shall be paid interest on its capital contribution, capital account or Membership Interests. A Member will not receive from the Company or out of Company property and has no right to withdraw or demand and the Company shall not return to a Member, any part of that Member’s capital contributions or capital account except as this Operating Agreement provides.
| Operating Agreement – EverOn Energy LLC | ||
| 2 |
2.3 The Members. The name, address, number of units, and percentage interest and capital contribution of the Members are set forth on Exhibit C hereto, as it may be amended from time to time. The Company may issue certificates to the Members representing their units if the Board so determines. Certificates, if issued, will bear appropriate restrictive legends. If the Company does not issue certificates representing units, then solely this Operating Agreement and the records of the Company will evidence ownership of Membership Interests.
2.4 Actions by the Members; Meetings. The Company shall be a manager-managed Company pursuant to Article III, and except as provided in this Agreement or required pursuant to the Act, Members shall not have authority or responsibility for the general oversight, business, operations, or affairs of the Company. Except as provided in this Agreement including Section 3.8, any action of the Members shall require the vote of Members holding a majority of the Membership Interests at a meeting of such Members. Meetings of the Members may be called at any time by any Member. Any action the Members may take by vote at a meeting may also be taken by written consent of Members that would otherwise be sufficient to authorize such action at a meeting.
2.5 Power to Bind the Company. No Member acting in its capacity as such shall have any authority to bind the Company to any third party with respect to any matter.
2.6 Admission of Members. No new members shall be admitted to the Company except as expressly provided and authorized hereunder.
2.7 Loans to the Company. The Company may borrow money from any Member or any Affiliate (as hereinafter defined) of a Member (each a “Member Loan”). Member Loans shall be debts due from the Company and shall not be treated as capital contributions (except to the extent required by the Act or the US IRC).
Article
III
Management
3.1 Management by the Board of Managers. Except as otherwise expressly provided herein, the general oversight, decisions, business, operations, and affairs of the Company shall be managed by or under the direction of a board of managers of the Company (the “Board of Managers” or the “Board” and each member of the Board, individually, a “Manager”). The Managers shall not receive compensation from the Company for their services as Managers though the Managers or their respective affiliates may contract with the Company for services to the Company or its subsidiaries and receive compensation for such services. Each Manager shall receive reimbursement for reasonable expenses which they may incur in connection with their efforts in managing the business of the Company; provided that such expenses are reasonable and supported by adequate documentation and have been pre-approved by the Board. The Managers need not be Members.
| Operating Agreement – EverOn Energy LLC | ||
| 3 |
3.2 Composition of the Board of Managers. The Board of Managers shall be comprised of four Managers, two of whom shall be appointed by Hover and two of whom shall be appointed by Alternus, in each case, to serve until his or her successor has been duly elected and qualified, or until his or her earlier removal, resignation, death or disability. Either party may remove any Manager appointed by that party at any time, with or without cause. The Managers are set forth on Exhibit C-1 attached hereto, as it may be amended from time to time.
3.3 Resignation of Managers. The Managers may resign at any time upon written notice to the Company. Upon the resignation, removal, death or disability of a Manager, the Member that initially designated such Manager shall appoint a successor who shall serve the unexpired term of his or her predecessor in office.
3.4 Meetings of the Board; Action by the Board of Managers.
(a) Meetings of the Board of Managers shall be held at least monthly at such times and at such place or places as shall be determined by the Board, with written notice thereof delivered to each Manager, unless otherwise agreed to by the Board. A quorum for action by the Board shall consist of Managers representing at least 3/4 of the Board. Managers may participate in any meeting by means of conference telephone or similar communication medium if the Manager(s) participating in such meeting may hear one another for the entire discussion of the matter(s) to be voted upon; with participation in a meeting by telephone or similar communication medium constituting presence in person at such meeting. Each Manager shall be entitled to one vote on any matter to come before the Board for approval.
(b) Action required or permitted to be taken at a meeting of the Board may be taken without a meeting if the action is evidenced by one or more written consents describing the action taken and executed by at least a simple majority of the Board at which a quorum is present. In the event of a deadlock of the Board as to any matter to be acted upon, the Managers appointed by Hover and the Managers appointed by Alternus shall each designate an individual (each a “Manager Designee”) to represent them in good faith negotiations to resolve the deadlock. In the event that, after ten (10) days, the deadlock has not been resolved, the two Manager Designees shall present alternative solutions to their respective Members for review and re-vote by the Board. If a deadlock remains, then Alternus, as the owner of a 51% Membership Interest, shall cast the tie-breaking vote.
3.5 Standard of Care. The Managers and any Officers of the Company (as defined below) appointed pursuant to Section 3.2 shall owe to the Company and the Members duties of care and loyalty equivalent to those owed by the officers of a Delaware business corporation to such corporation and its stockholders.
| Operating Agreement – EverOn Energy LLC | ||
| 4 |
3.6 Officers. The Board of Managers may, from time to time, as it may deem necessary or advisable, appoint officers of the Company (each an “Officer”) and assign in writing titles (including, without limitation, Chief Executive Officer, President, Secretary, and Treasurer) to any such person. Unless the Board decides otherwise, if the title is one commonly used for officers of a business corporation formed under the General Corporation Law of the State of Delaware, then the assignment of such title shall constitute the delegation to such person of the authorities and duties that are normally associated with that office. Any delegation of duties to an Officer pursuant to this Section 3.6 may be revoked at any time by vote of the Board. The Officers of the Company shall hold office until their successors are chosen and qualified. Any Officer may be removed, for cause, at any time, by vote of the Board. Any vacancy occurring in any office of the Company shall be filled by the Board. The initial Officers are set forth on Exhibit C-2 attached hereto, as it may be amended from time to time.
3.7 Limited Liability. Except as otherwise expressly provided by the Act, the debts, obligations and liabilities of the Company, whether arising in contract, tort or otherwise, shall be the debts, obligations and liabilities solely of the Company, and neither the Members, the Managers or the Officers shall be obligated personally for any such debt, obligation or liability of the Company solely by reason of being a Member, a Manager or an Officer of the Company so long as the actions or omissions of such Member, Manager or Officer do not constitute conduct involving bad faith, willful or intentional misconduct or a knowing violation of law by such person.
3.8 Actions Requiring Approval of Members. Without the unanimous vote or written consent of all of the Members, the Company shall not, and shall not enter into any commitment to (and shall ensure that neither the Local OpCo’s nor their subsidiaries or affiliates shall not):
(a) amend, modify, or waive any provisions of the Certificate of Formation or this Operating Agreement; provided that the Board may, without the consent of the Members, amend its Certificate of Formation following any new issuance, redemption, repurchase, or Transfer (as hereinafter defined) of Membership Interests undertaken in accordance with this Operating Agreement;
(b) issue additional Membership Interests or other securities or, except in connection with a Permitted Transfer (as hereinafter defined), admit additional Members to the Company or approve any Transfer;
(c) incur any indebtedness in excess of $100,000, other than in the ordinary course of business, or guarantee any indebtedness, pledge or grant liens on any assets, assume, endorse, or otherwise become responsible for the obligations of any other Person, outside the ordinary course of business, either in a single transaction or series of related transactions, or in the aggregate at any time outstanding;
| Operating Agreement – EverOn Energy LLC | ||
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(d) make any loan or advance to, or a capital contribution or investment in, any Person;
(e) enter into or effect any transaction or series of related transactions involving the purchase, lease, license, exchange, or other acquisition (including by merger, consolidation, acquisition of equity interests, or acquisition of assets) by the Company, other than in the ordinary course of business consistent with past practice and not in excess of $100,000;
(f) enter into or effect any transaction or series of related transactions involving the sale, lease, mortgage, pledge, license, exchange, otherwise transfer or dispose of all or substantially all of the property or assets of the Company, or other disposition (including by merger, consolidation, sale of equity interests, or sale of assets) by the Company.
(g) authorize a transaction involving an actual or potential conflict of interest between a Member and the Company;
(h) change the nature of the business of the Company; or
(i) dissolve, wind up, or liquidate the Company or initiate a voluntary bankruptcy proceeding involving the Company.
For purposes of this Operating Agreement, “Person” shall mean an individual, corporation, partnership, joint venture, limited liability company, governmental authority, unincorporated organization, trust, association, or other entity.
Article IV Microgrid project development obligations
The Members shall enter into the following agreements, and perform the following actions, in furtherance of the successful development and ultimate disposition of the Microgrid Projects owned and controlled by the JV:
4.1 Exclusive Development. The JV shall have the exclusive right to develop the JV Projects. JV Projects shall be owned and controlled exclusively by the JV regardless of their origination whether by a Member or third-party, and their management, development, and financing shall be governed in all cases by this Agreement, whether such JV Project is held directly, by a wholly owned subsidiary Local OpCo or dedicated SPV, or otherwise.
4.2 The Company shall enter into a Management Services Agreement (“MSA”) with each of the Members, attached hereto as Exhbiit D-1 pursuant to which they will provide the agreed personel to direct and manage the development activities of the JV related to each Project, in all cases under the direction of the Managers.
| Operating Agreement – EverOn Energy LLC | ||
| 6 |
4.3 The Company shall also enter into an Equipment Supply Agreement with Hover, attached hereto as Exhibit D-2.
(a) The ESA shall provide that:
| ● | JV to purchase all wind turbine equipment required for all Projects from Hover (to the extent Hover’s product line is applicable); |
| ● | JV will directly source all equipment required for all Projects including any Hover equipment; and |
| ● | Hover warrants and agrees that the prices, terms, and conditions for the equipment supplied under the ESA shall be no less favorable than those offered by Hover to any other customer for the same or comparable equipment sold under substantially similar terms and conditions. Should Hover offer more favorable prices, terms, or conditions to any other customer for such equipment, it shall promptly notify the JV in writing and offer the JV such more favorable terms and conditions, effective as of the date they are granted to such other customer. |
4.4 Project Approval Process.
(a) Development Committee. The Company shall have a “Development Committee” consisting of four individuals, of whom 2 are designated by Alternus and 2 are designated by Hover; the Members shall designate individuals whose primary responsibilities and experience is in renewable energy project development. The Development Committee shall meet regularly as reasonably required (typically weekly) for the administration of its responsibilities below.
(b) Responsibilities. The Development Committee shall be primarily and directly responsible for the review and evaluation of prospective Microgrid Projects for acquisition, development, and/or financing by the JV, including but not limited to prospective Future Projects. The Development Committee shall also be primarily and directly responsible for monitoring the development of all JV Projects and making major operational and budgeting decisions therefor. The Board shall act as final decision maker and be arbitrator of any deadlocks of the Development Committee related to Project selection.
(c) Time is of The Essence. The Development Committee shall evaluate, and accept or reject, any prospective Microgrid Project promptly and in good faith, provided that in the case of any prospective Future Project, the JV shall have twenty (20) business days from the date such project isfirst introduced to the JV to evaluate, and accept or reject it. During such evaluation period, i) the Development Committee shall have the opportunity to assess and evaluate such Microgrid Project, visit the site proposed for such Microgrid Project and ask the potential customer, originating developer, or originating Member, as applicable, to provide such additional reasonable information and answer any reasonable questions in relation to such Microgrid Project, and, if applicable, the originating Member shall not sell, or offer for sale or negotiate the sale of, such Microgrid Project to any other potential buyers during this time. The Development Committee shall notify the Board in writing of its acceptance or its refusal of each prospective Microgrid Project. The Development Committee’s failure to accept a prospective Future Project in writing in the 20 business day period described above shall be considered a refusal by the JV. Any refusal by the JV of a prospective Future Project under this Section will entitle the originating Member to develop, or offer for sale, or discuss or negotiate the sale, to other third parties chosen in the sole discretion of the originating Member.
| Operating Agreement – EverOn Energy LLC | ||
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Article
V
INTELLECTUAL PROPERTY
5.1 Intellectual Property. All right, title and interest in and to inventions, software, improvements, know-how and/or technology, whether or not patentable or copyrightable (collectively, “Intellectual Property”), owned, created or developed by a Member or its affiliates are and will remain the property of such Member, and such Member or its affiliates shall have sole rights to any and all such Intellectual Property, except as mutually agreed in writing by the parties pursuant to a licensing agreement or other contract.
5.2 Joint Intellectual Property. All right, title and interest in and to Intellectual Property created or developed jointly by the JV (including but not limited to the Project Modelling Tool (“PMT”) aka OASIS jointly developed by the Members), or by the Members for the use of the JV, shall be jointly owned by Hover and Alternus (“JV IP”). Further, each Member Party agrees to grant to the Member an irrevocable, non-exclusive, royalty-free, non-transferable license for the use of such JV IP in perpetuity.
Article
VI
ALLOCATION OF Profits AND Losses and Distributions
6.1 Profits and Losses. For financial accounting and tax purposes, the Company’s net profits or net losses shall be determined on an annual basis in accordance with the manner determined by the Board, in each case consistent with the Code. In each year, profits and losses and components thereof, including individual items of gross income, gain, loss, deduction or credit, shall be determined for each period in accordance with income tax accounting methods that the Board adopts for the Company consistently applied and will be allocated between the Members based on their Membership Interest ownership percentage. Notwithstanding any other provision of this Operating Agreement, (i) “partner nonrecourse deductions” (as defined in Treasury Regulations Section 1.704-2(i)), if any, of the Company shall be allocated for each fiscal year to the Member that bears the economic risk of loss within the meaning of Treasury Regulations Section 1.704-2(i) and “nonrecourse deductions” (as defined in Treasury Regulations Section 1.704-2(b)) and “excess nonrecourse liabilities” (as defined in Treasury Regulations Section 1.752-3(a)), if any, shall be allocated to and among the Members in accordance with their Membership Interests. This Agreement shall be deemed to include “qualified income offset,” “minimum gain chargeback,” and “partner nonrecourse debt minimum gain chargeback” provisions within the meaning of Treasury Regulations under Section 704(b) of the Internal Revenue Code of 1986, as amended (the “Code”). All items of income, gain, loss, deduction, and credit of the Company shall be allocated between the Members for federal, state and local income tax purposes consistent with the manner that the corresponding items are allocated among the Members pursuant to this section, except as may otherwise be provided herein or under the Code.
| Operating Agreement – EverOn Energy LLC | ||
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6.2 Distributions. The Company shall make distributions of available cash to the Members at the times, to be addressed by the Board at least quarterly, and in the aggregate amounts determined by the Board, all profits from operations of Projects owned by the JV. Such distributions shall be paid to the Members reflecting their Membership Interests at that time. Notwithstanding any provision to the contrary contained in this Operating Agreement, the Company shall not make any distribution to Members if such distribution would violate Section 18-607 of the Act or other applicable law. In the event that any non-cash assets of the Company are to be distributed in kind, such assets will be distributed on the basis of the then fair market value thereof as determined in good faith by the Board. In the case of a liquidation, dissolution or sale of the Company, any amounts available for distribution to Members will be distributed in accordance with Section 7.2. Notwithstanding anything to the contrary in this Operating Agreement, the Company may forego making distributions to the extent necessary or appropriate to provide for the retention and establishment of reserves of, or payment to Persons of, amounts that the Board determines are necessary or appropriate to provide for the Company’s business needs or to achieve the Company’s purposes (including the payment or the making of provision for the payment when due of the Company’s obligations including present and anticipated debts and obligations, capital expenditures, expense reimbursements, reasonable reserves for contingencies and setting aside amounts for acquisitions and investments).
6.3 Books and Records. The Board shall keep or cause to be kept complete and accurate books of account and records with respect to the Company’s business. The Members and each of their duly authorized representatives shall have the right to examine the Company’s books, records and documents during normal business hours. The Company’s books of account shall be kept using the method of accounting determined by the Board. The Company’s independent auditor, if any, shall be an independent public accounting firm used by Alternus as part of its SEC and PCAOB reporting obligations.
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Article VII
Events of Dissolution
7.1 Event of Dissolution. The Company shall be dissolved upon the occurrence of any of the following events (each, an “Event of Dissolution”):
(a) the unanimous authorization or written consent of the Members;
(b) the sale, exchange, involuntary conversion, or other disposition or Transfer of all or substantially all of the assets of the Company;
(c) the bankruptcy, insolvency, or general assignment for the benefit of creditors, or any Member, or
(d) the entry of a decree of judicial dissolution of the Company under Section 18-802 of the Act.
7.2 Liquidation. The Company will terminate after its affairs have been wound up and its assets fully distributed in liquidation as follows after allocation of profit and loss pursuant to the provisions here:
(a) first, to the payment and discharge of all of the Company’s debts and liabilities, including any debts and liabilities owed to any Member, and to the expenses of liquidation;
(b) second, to the establishment of reserves to pay future costs or expenses that are reasonably anticipated to exceed cash available to pay such costs or expenses when due, as determined by the Board of Managers in their sole discretion;
(c) third, to each Member, according to their allocation of Distributions pursuant to Section 6.2.
7.3 Dissolution Activities. In the event of dissolution, the Company shall conduct only such activities as are necessary to wind up its affairs, and the assets of the Company shall be applied in the manner, and in the order of priority, set forth in Section 18-804 of the Act. The Company shall terminate when (i) all of the assets of the Company, after payment of or due provision for all debts, liabilities and obligations of the Company, shall have been distributed to the Members in the manner provided for in this Operating Agreement, and (ii) the Certificate of Formation shall have been cancelled in the manner required by the Act.
| Operating Agreement – EverOn Energy LLC | ||
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Article VIII
Transfer of Interests in the Company
8.1 General Restrictions on Transfer.
(a) Except as permitted pursuant to Section 8.2, no Member shall Transfer (as hereinafter defined) all or any portion of its Common Interest in the Company, except with the written consent of all Members. No Transfer of Membership Interests to a Person not already a Member of the Company shall be deemed completed until the prospective Transferee is admitted as a Member of the Company in accordance with provisions hereof. For purposes hereof, “Transfer” shall mean to sell, transfer, assign, gift, pledge, encumber, hypothecate, or similarly dispose of, directly or indirectly, voluntarily or involuntarily, by operation of law or otherwise, or to enter into any contract, option, or other arrangement or understanding with respect to the sale, transfer, assignment, gift, pledge, encumbrance, hypothecation, or similar disposition of, any Membership Interests or any interest (including a beneficial interest) therein; “Transfer” when used as a noun shall have a correlative meaning. “Transferor” and “Transferee” mean a Person who makes or receives a Transfer, respectively.
(b) Notwithstanding any other provision of this Operating Agreement (including Section 8.2), each Member agrees that it will not Transfer all or any portion of its Membership Interests in the Company, and the Company agrees that it shall not issue any Membership Interests:
| (i) | except as permitted under the Securities Act of 1933, as amended (the “Securities Act”) and other applicable federal or state securities or blue sky laws, and then, with respect to a Transfer of Membership Interests, only upon delivery to the Company of an opinion of counsel in form and substance satisfactory to the Company to the effect that such Transfer may be effected without registration under the Securities Act; |
| (ii) | if such Transfer or issuance would cause the Company to be considered a “publicly traded partnership” under Section 7704(b) of the Code within the meaning of Treasury Regulation Section 1.7704-1(h)(1)(ii), including the look-through rule in Treasury Regulation Section 1.7704-1(h)(3); |
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| (iii) | if such Transfer or issuance would affect the Company’s existence or qualification as a limited liability company under the Act; |
| (iv) | if such Transfer or issuance would cause the Company to lose its status as a partnership for federal income tax purposes; or |
| (v) | if such Transfer or issuance would cause the Company to be required to register as an investment company under the Investment Company Act of 1940, as amended. |
(c) Any Transfer or attempted Transfer of any Common Interest in violation of this Operating Agreement shall be null and void, no such Transfer shall be recorded on the Company’s books, and the purported Transferee in any such Transfer shall not be treated (and the purported Transferor shall continue be treated) as the owner of such Common Interest for all purposes of this Operating Agreement.
(d) Except as provided herein, no Transfer (including a Permitted Transfer) of Membership Interests to a Person not already a Member of the Company shall be deemed completed until the prospective Transferee (including a Permitted Transferee) is admitted as a Member of the Company in accordance with the provisions herein.
(e) For the avoidance of doubt, any Transfer of a Common Interest permitted by this Operating Agreement shall be deemed a sale, transfer, assignment, or other disposal of such Common Interest in its entirety as intended by the parties to such Transfer, and shall not be deemed a sale, transfer, assignment, or other disposal of any less than all of the rights and benefits described in the definition of the term “Common Interest,” unless otherwise explicitly agreed to by the parties to such Transfer.
8.2 Permitted Transfers. The provisions of Section 8.1(a) shall not apply to any Transfer by any Member of all or any portion of its Membership Interests to any parent entity owning 100% of the equity of such Member (a “Permitted Transferee” and, any such Transfer to a Permitted Transferee, a “Permitted Transfer”).
Lock-up
8.3 Except for a Permitted Transfer, neither Member is entitled to Transfer, without the prior written consent of the other Members, all or any of its Shares prior to the 3 year anniversary of the date of this Agreement, unless such Transfer is permitted or mandatory under this Agreement.
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8.4 If a Member wishes to accept a bona fide offer in writing received from one or more Interested Purchasers for all or a part of the Shares held by it, it is obliged to (i) immediately give written notice to the other Member (Notice) of the receipt of such offer, and (ii) allow the other Member to purchase the Offered Shares from it in accordance with Article 7.5, it being understood that, if the Offered Shares have not been accepted by the other Member in accordance with Article 7.5, the Member may effect that the Offered Shares are sold and transferred to the Interested Purchaser in accordance with Article 7.5.
8.5 If a Member wishes to exercise its right of first refusal to accept the Offered Shares it is required to give written notice to the other Member within 2 (two) weeks from the date of receipt of the Notice that it wishes to purchase all or a portion of the Offered Shares, at the same price and conditions as offered by the Interested Purchaser. If after such procedure not all of the Offered Shares would be acquired, the Member may effect the sale and transfer of all (and not less than all) of the Offered Shares to the Interested Purchaser. If after such procedure all (and not less than all) of the Offered Shares are accepted by the other Member, the Member shall be obliged to procure that (the relevant portion of) the Offered Shares shall be transferred to the other Member within 2 (two) weeks after acceptance. If the other Member does not or not timely exercise its rights under this Article 7.5, it agrees to refrain from exercising any other rights it may have under the Articles in relation to any pre-emptive rights and to give all reasonable co-operation which the Member may require to effect the sale and transfer of the (relevant portion of the) Offered Shares to the Interested Purchaser.
Expert valuation
8.6 If a Member deems the purchase price offered in relation to the Offered Shares not to represent a fair market value, it may appoint a reputable valuator (Expert) who shall determine the Fair Market Value of the Shares. If the purchase price offered in relation to the Offered Shares is less than the Fair Market Value, the other Member shall reimburse such difference on a euro-for-euro basis.
Article IX
NON-COMPETITION AND NON-SOLICITATION
9.1 Each Member and its Affiliates hereby covenants that it shall not compete, directly or indirectly, with the JV Projects, nor solicit, negotiate, or enter into any agreement related to any JV Project, except through the JV (or its Local OpCo’s or wholly owned SPVs) or with the written consent of the JV.
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9.2 Each of the Members covenants and agrees with the Company that, during the term of this Agreement neither the Members nor any of their Affiliates shall, and shall ensure that their officers, managers or directors (whether alone or jointly with another person and whether directly or indirectly and whether as shareholder, partner, promoter, director, officer, agent, manager, employee or consultant in or to any other person), shall not:
(a) solicit or endeavor to entice away or discourage from dealing with the Company related to Microgrid Projects, any client, customer or supplier or other person, who is at the time of the purported solicitation, enticement or discouragement or was during the 12 (twelve) months prior thereto a client, supplier, or customer of the Company, except to the extent such person;
(b) supply or provide any services related to Microgrid Projects to any person who is at the time of the supply or provision or was during the 12 (twelve) months prior thereto a customer of the Company, except to the extent such Member has a documented business relationship with such person that pre-existed this Agreement;
(c) solicit, entice away or endeavor to entice away, engage, hire or employ, in each case directly or indirectly, any employee or independent contractor of the Company, except to the extent such employee was employed directly by such Member in the prior 12 months;
(d) use any of the Company's intellectual property rights for any purpose other than (i) for work performed for the Company in accordance with any relevant agreement and/or in the ordinary course of business, or (ii) pursuant to Section [5] or, (iii) with the prior written unanimous approval of the Members; and
(e) use and/or disclose to a third party any knowledge each Member has in relation to the Company in a manner that would have a material adverse effect on the Business Plan.
9.3 Each of the covenants contained in Article 9 shall be deemed to constitute a separate covenant and shall be construed independently of the others and each of these covenants shall remain valid in relation to each of the Members for the period that the relevant Member is a party to this Agreement.
9.4 Each of the Parties hereby agrees that each of the covenants contained in Article 9 is reasonable and necessary for the protection of each of the Member’s interests in the Company. If, however, a court of competent jurisdiction should determine that any of the covenants in Article 8 is unenforceable by reason of the given period of time or the geographic scope stated herein, then the period of time and/or geographic scope shall be reduced to the maximum period or scope which would be enforceable.
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Article
X
Indemnification
10.1 Indemnification(a). To the fullest extent permitted by applicable law, any Members, any Affiliate of a Members, any officer, director, shareholder, partner, employee or member of a Member or of any Affiliate of such Member or any Manager, Officer or employee of the Company (each, a “Covered Person”) shall be entitled to indemnification from the Company for any loss, damage or claim (including any amounts paid in settlement of any such claims) including expenses, fines, penalties and counsel fees and expenses (collectively “Losses”) incurred by such Covered Person by reason of any act or omission performed or omitted by such Covered Person in good faith on behalf of the Company (or any of its affiliates) and in a manner reasonably believed to be within the scope of authority conferred on such Covered Person by this Operating Agreement, except that no Covered Person shall be entitled to be indemnified in respect of any Losses incurred by such Covered Person by reason of any action or inaction of such Covered Person which constituted fraud, gross negligence, or willful misconduct; provided, however, that any indemnity under this Section 10.1 shall be provided out of and to the extent of Company assets only, and no Member or Covered Person shall have any personal liability to provide indemnity on account thereof. For purposes of this Operating Agreement, “Affiliate” shall mean, with respect to any Person, any other Person who, directly or indirectly, controls, is controlled by, or is under common control with such Person and, for purposes of this definition, “control” when used with respect to any specified Person, shall mean the power, direct or indirect, to direct or cause the direction of the management and policies of such Person, whether through ownership of voting securities or partnership or other ownership interests, by contract, or otherwise; and the terms “controlling” and “controlled” shall have correlative meanings.
Article
XI
Accounting and Tax Matters
11.1 Inspection Rights. Upon reasonable notice from a Member, the Company shall afford the Member reasonable access during normal business hours to the corporate, financial, and similar records, reports, and documents of the Company, and shall permit the Member to examine such documents and make copies thereof.
11.2 Tax Matters Representative.
(a) Appointment; Resignation. The Members hereby appoint [Alternus] as the “partnership representative” as provided in Section 6223(a) of the Code (the “Tax Matters Representative”). The Tax Matters Representative can be removed at any time by a vote of Members holding all of the Membership Interests of the Company. In the event of the resignation or removal of the Tax Matters Representative, the holders of all of Membership Interests of the Company shall appoint a new Tax Matters Representative.
(b) Tax Examinations and Audits. The Tax Matters Representative is authorized and required to represent the Company (at the Company’s expense) in connection with all examinations of the Company’s affairs by any federal, state, local, or foreign taxing authority, including resulting administrative and judicial proceedings, and to expend Company funds for professional services and costs associated therewith.
(c) Authority. The Tax Matters Representative shall have sole authority to act on behalf of the Company in any such examinations and any resulting administrative or judicial proceedings, and shall have sole discretion to determine whether the Company (either on its own behalf or on behalf of the Members) will contest or continue to contest any tax deficiencies assessed or proposed to be assessed by any taxing authority.
(d) Indemnity of Tax Matters Representative. The Company shall defend, indemnify, and hold harmless the Tax Matters Representative against any and all liabilities sustained as a result of any act or decision concerning Company tax matters and within the scope of such Member’s responsibilities as Tax Matters Representative, so long as such act or decision was done or made in good faith and does not constitute fraud, gross negligence, or willful misconduct.
Article
XII
Miscellaneous
12.1 Goodwill and Publicity. Neither Party shall (a) make any press release or public announcement relating to the specific terms of this Agreement or the Projects (except for filings, other statements or releases as may be required by applicable law or stock exchange rules), or (b) use any name, trade name, service mark or trademark of the other Party in any promotional or advertising material without the prior written consent of the other Party such consent not to be unreasonably withheld conditioned or delayed. The Parties shall coordinate and cooperate with each other when making public announcements regarding this Agreement or the Projects and each Party shall promptly review, comment upon and approve any publicity materials, press releases or other public statements before they are made.
12.2 Amendments. Amendments to this Operating Agreement and to the Certificate of Formation shall be approved by Hover and Alternus. An amendment shall become effective as of the date specified in the approval of Hover and Alternus or if none is specified as of the date of such approval or as otherwise provided in the Act.
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12.3 Severability. In the event that any provision of this Operating Agreement is held to be invalid or unenforceable for any reason, such provision shall be ineffective to the extent of such invalidity or unenforceability; provided, however, that the remaining provisions will continue in full force without being impaired or invalidated in any way unless such invalid or unenforceable provision or clause shall be so significant as to materially affect the expectations of the Members regarding this Operating Agreement. Otherwise, any invalid or unenforceable provision shall be replaced by the Members with a valid provision which most closely approximates the intent and economic effect of the invalid or unenforceable provision.
12.4 Dispute Resolution.
(a) Informal Resolution. In the event a dispute, controversy or claim arises hereunder, the aggrieved Party shall promptly provide written notification of the dispute, controversy or claim to the other Party within ten (10) days after such dispute, controversy or claim arises. In such event the Parties shall undertake to meet within fourteen (14) days (as such number of days may be extended by mutual agreement of the Parties) of a Party’s receipt of such notice such meeting to be attended by representatives of each of the Parties with decision-making authority regarding the dispute, controversy or claim to attempt in good faith to negotiate a resolution of the dispute, controversy or claim.
(b) Mediation; Arbitration. In the event that the Parties are unable to resolve any dispute, controversy or claim as contemplated by Section 12.3(a) above, the dispute, controversy or claim shall be subject to mediation. The Parties shall endeavor to resolve their claims by mediation which, unless the Parties mutually agree otherwise, shall be administered in accordance with the Construction Rules and Mediation Procedures of the American Arbitration Association in effect on the date mediation is requested. The Parties shall bear equally the fees and costs associated with the engagement of the mediator. The mediation shall be held in the State of New York, unless another location is mutually agreed upon. Any agreements reached in mediation shall be enforceable as settlement agreements in any court having jurisdiction thereof. Any claim not resolved by mediation shall be subject to arbitration which, unless the Parties mutually agree otherwise, shall be administered in New York City in accordance with the Construction Industry Arbitration Rules of the American Arbitration Association in effect on the date of the demand for arbitration. The award rendered by the arbitrator or arbitrators shall be final and binding and judgment may be entered upon it in accordance with applicable law in any court having jurisdiction thereof. The prevailing Party shall be awarded reimbursement for all reasonable attorneys’ fees, expert fees, and all other third-party costs incurred by the prevailing Party.
12.5 Waiver. No waiver by any party of any of the provisions hereof shall be effective unless explicitly set forth in writing and signed by the party so waiving. No failure to exercise, or delay in exercising, any right, remedy, power, or privilege arising from this Operating Agreement shall operate or be construed as a waiver thereof, nor shall any single or partial exercise of any right, remedy, power, or privilege hereunder preclude any other or further exercise thereof or the exercise of any other right, remedy, power, or privilege.
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12.6 Notices. All notices, requests, consents, claims, demands, waivers, and other communications hereunder shall be in writing and shall be deemed to have been given:
(a) when delivered by hand;
(b) when received by the addressee if sent by a nationally recognized overnight courier;
(c) on the date sent by facsimile or email of a PDF document (with confirmation of transmission) if sent during normal business hours of the recipient, and on the next business day if sent after normal business hours of the recipient, but only if and to the extent explicitly acknowledged by the recipient; or
(d) on the third day after the date mailed, by certified or registered mail, return receipt requested, postage prepaid.
Such communications must be sent to the respective parties at the following addresses (or at such other address for a party as shall be specified in a notice given in accordance with this Section 12.6):
If to Hover to:
Hover Energy LLC
5420 LBJ Freeway, Suite 350
Dallas, TX 75240
Attention: Chris Griffin
Email: [email protected]
If to Alternus to:
Alternus Clean Energy, Inc.
17 State Street, Suite 4000
New York, NY 10004
Attention: Vincent Browne
Email: [email protected]
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12.7 Further Assurances. Upon the reasonable request of the other party, each party shall execute such further instruments, documents, and agreements, and shall give such further written assurances, as may be reasonably requested to carry into effect the intent and purposes of this Operating Agreement.
12.8 Interpretation. In construing this Operating Agreement, (a) the singular includes the plural and vice versa, (b) reference to any document means such document as amended, restated, or otherwise modified from time to time, (c) “include” or “including” means including without limiting the generality of any description preceding such term, (d) the word “or” is not exclusive, (e) references to this Operating Agreement or Sections or paragraphs of this Operating Agreement refer to this entire Agreement including all exhibits, schedules, and addendum attached hereto, as the same may be amended from time to time, and (f) headings and numberings contained herein are for convenience only and shall not affect the interpretation of this Operating Agreement.
12.9 No Presumption Against Any Party. Neither this Operating Agreement nor any uncertainty or ambiguity herein will be construed or resolved against any party, whether under any rule of construction or otherwise. Each of the parties to this Operating Agreement has had an opportunity to review this Operating Agreement with counsel of its choosing, and therefore it will be construed and interpreted according to the ordinary meaning of the words used so as to fairly accomplish the purposes and intentions of all parties.
12.10 Entire Agreement. This Agreement, together with the Certificate of Formation and all related Exhibits and Schedules, constitutes the sole and entire agreement of the parties to this Operating Agreement with respect to the subject matter contained herein and therein, and supersedes all prior and contemporaneous understandings, agreements, representations, and warranties, both written and oral, with respect to such subject matter.
12.11 No Third-Party Beneficiaries. This Operating Agreement is for the sole benefit of the parties hereto (and their respective heirs, executors, administrators, legal representatives, successors, and permitted assigns) and nothing herein, express or implied, is intended to or shall confer upon any other Person, including any creditor of the Company, any legal or equitable right, benefit, or remedy of any nature whatsoever under or by reason of this Operating Agreement.
12.12 Governing Law. This Agreement shall be governed by and construed in accordance with the laws of the State of Delaware without regard to the principles of conflicts of laws thereof.
[Signature Page Follows]
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IN WITNESS WHEREOF, the undersigned have duly executed this Operating Agreement as of the day first above written.
| HOVER ENERGY LLC | ||
| By: | /s/ Chris Griffin | |
| Name: | Chris Griffin | |
| Title: | Chief Executive Officer | |
| AltERNUS CLEAN ENERGY, INC. | ||
| By: | /s/ Vincent Browne | |
| Name: | Vincent Browne | |
| Title: | Chief Executive Officer | |
[Signature Page to EverOn Energy LLC Operating Agreement]
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Exhibit 10.2
SECURITIES PURCHASE AGREEMENT
This SECURITIES PURCHASE AGREEMENT (the “Agreement” or the “Purchase Agreement”), between Alternus Clean Energy Inc. (“ALCE” or the “Company”), a corporation formed under the laws of the State of Delaware, and Hover Energy LLC (the “Subscriber”), made as of the last date set forth by a Party on the signature page hereof.
This Agreement is being entered into simultaneously with, and conditional upon, the Parties also entering into the Joint Venture Operating Agreement and its related ancillary agreements related to EverOn Energy LLC (together, the “JVOA”). Capitalized terms used herein and not otherwised defined shall have the same meanings as defined in the JVOA.
W I T N E S S E T H:
WHEREAS, subject to the terms and conditions set forth in this Agreement and pursuant to Section 4(a)(2) and/or 4(6) of the Securities Act of 1933, as amended (the “1933 Act” or “Securities Act”), and Rule 506 of Regulation D as promulgated by the United States Securities and Exchange Commission (the “Commission”), the Company desires to issue and sell to the Subscriber, and the Subscriber desires to acquire from the Company, securities of the Company as more fully described in this Agreement (the “Offering”). Execution of this Subscription Agreement by the Subscriber shall constitute an offer by the Subscriber to purchase the securities on the terms and conditions specified herein.
WHEREAS, the Subscriber desires to acquire from ALCE in this Offering 20,000 shares of Series B Convertible Preferred stock of ALCE subject to that certain Certificate of Designation of Series B Convertible Preferred Stock of Alternus Clean Energy dated or about the Effective Date (the “Certifiate of Designation”) and a 49% membership interest in Ever On Energy LLC, a Delaware LLC and ALCE’s wholly owned subsidiary (the “JV”), subject to the provisions described herein (together, the “Securities”) on the terms and conditions hereinafter set forth; and
NOW, THEREFORE, in consideration of the premises and the mutual covenants herein contained, the parties hereto agree as follows:
1. Issuance, Sale and Delivery of the Securities.
(a) Subject to the terms and conditions set forth herein on the Closing Date (as defined below) ALCE shall issue, sell and deliver to Subscriber, and Subscriber shall acquire from ALCE, 20,000 shares of ALCE Series B Convertible Preferred stock and a 49% Membership Interest in the JV, in exchange for Hover entering into the JVOA, and including Hover’s contributions of the Initial Projects and Pipeline to the JV pursuant to the JVOA.
2. Closing Date. The “Closing Date” shall be upon the full execution of this Agreement and the JVOA. The consummation of the transactions contemplated herein shall take place at the offices of the Company, upon the satisfaction or waiver of all conditions to closing set forth in this Agreement. Subscriber shall purchase and the Company shall sell to Subscriber the Securities (the “Closing”).
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3. Representations and Warranties of ALCE. ALCE represents and warrants to Subscriber as follows:
(a) Organization ALCE is a Corporation duly formed, validly existing and in good standing under the laws of the State of Delaware. JV is a LLC duly formed, validly existing and in good standing under the laws of the State of Delaware. Each of the JV and ALCE has, or on or prior the Closing Date will or has, the authority to own and hold its properties, to carry on its business as currently conducted, to execute, deliver and perform this Agreement and to issue and deliver the Securities.
(b) Authorization of Agreements, Etc. This Agreement has, or on or prior to the Closing Date will have, been duly executed and delivered by ALCE and constitutes the valid and binding obligation of ALCE enforceable against it in accordance with its terms, except as may be limited by bankruptcy, insolvency, fraudulent conveyance, reorganization or similar laws affecting creditors’ rights generally or by general equitable principles, and except insofar as the enforceability of any provision hereof would be restricted or void by reason of public policy.
(c) No Conflicts. ALCE’s execution and delivery of this Agreement and ALCE’s consummation of the transactions contemplated hereby will not (i) violate, conflict with or result in an event of default under any material agreement or contract to which ALCE is a party or by which it is bound, (ii) violate any applicable law, ordinance, rule or regulation of any governmental body having jurisdiction over ALCE or its business or any order, judgment or decree applicable to ALCE, or (iii) violate any provision of its certificate of incorporation or by-laws, each as may be in effect as of the Closing Date.
(d) Indemnification. ALCE agrees to indemnify and hold harmless Subscriber and its agents, representatives and employees from and against all liability, damage, loss, cost, fee and expense (including reasonable attorneys’ fees) which they may incur by reason of failure of ALCE to fulfill any of the terms or conditions of this Subscription Agreement, or by reason of any inaccuracy or omission in the information furnished by ALCE herein or any breach of the representations and warranties made by ALCE herein or in connection with this Subscription Agreement, or in any document provided by ALCE to Subsciber.
4. Representations and Warranties of the Subscriber.
Subscriber represents and warrants to ALCE with respect to itself as follows:
(a) Organization, Power and Authority. Subscriber, if not a natural person, is duly incorporated or organized, validly existing and in good standing in its jurisdiction. Subscriber has full power and authority to enter into, deliver and perform this Agreement and has taken all action required to authorize the execution and delivery hereof and to consummate the transactions contemplated hereby, including the purchase of the Securities, and, if Subscriber is not a natural person, the person signing this Agreement on behalf of Subscriber has been duly authorized to act on behalf of and to bind such party.
(b) Authorization of Agreements, Etc. This Agreement has been duly executed and delivered by the Subscriber and constitutes the valid and binding obligation of the Subscriber, enforceable against the Subscriber in accordance with its terms, except as may be limited by bankruptcy, insolvency, fraudulent conveyance, reorganization or similar laws affecting creditors’ rights generally or by general equitable principles, and except insofar as the enforceability of any provision hereof would be restricted or void by reason of public policy.
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(c) No Conflicts. The execution and delivery of this Agreement and the consummation of the transactions contemplated hereby will not (i) violate, conflict with or result in an event of default under any material agreement or contract to which the Subscriber is a party or by the Subscriber is bound, (ii) violate any applicable law, ordinance, rule or regulation of any governmental body having jurisdiction over such party or its business or any order, judgment or decree applicable to the Subscriber, (iii) require the Subscriber to obtain the consent of any governmental agency or entity or any other third party, other than such consents as have already been obtained, or (iv) if not a natural person, violate any provision of the Subscriber’s certificate of in Limited Liability Company, certificate of limited partnership, certificate of formation or other formation or organizational instrument or document, as applicable, and by-laws, partnership agreement or operating agreement, as applicable.
(d) Investment Representations. Subscriber represents and warrants to ALCE that (i) it has completed the “Accredited Investor Certification” attached to this Agreement, (ii) it is an “accredited investor” as such term is defined in Rule 501 of Regulation D (“Regulation D”) promulgated under the Securities Act of 1933, as amended (the “Securities Act”) and (iii) it is acquiring the Securities for its own account for the purpose of investment and not with a view to or for sale in connection with any distribution thereof. Subscriber further represents that Subscriber has knowledge and experience in business and financial matters and prior investment experience, including investment in securities that are non-listed, unregistered and/or not traded on a national securities exchange and that Subscriber understands that (i) the Securities and the underlying common shares have not been registered under the Securities Act, by reason of their issuance in a transaction exempt from the registration requirements of the Securities Act pursuant to Section 4(2) thereof or pursuant to Regulation D promulgated there under, (ii) the Securities and underlying common shares must be held indefinitely unless a subsequent disposition thereof is registered under the Securities Act or is exempt from such registration, (iii) the underlying common shares will bear a legend to such effect, and (iv) ALCE will make a notation on its transfer books to such effect.
(e) Compliance with Securities Act. The Subscriber understands and agrees that the Securities have not been registered under the 1933 Act or any applicable state securities laws, by reason of their issuance in a transaction that does not require registration under the 1933 Act (based in part on the accuracy of the representations and warranties of the Subscriber contained herein), and that such Securities must be held indefinitely unless a subsequent disposition is registered under the 1933 Act or any applicable state securities laws or is exempt from such registration. Prior to the execution of this Agreement, the Subscriber and any affiliates of Subscriber have not participated in any hedging transactions involving the Common Stock and have not sold short any of the Common Stock. The Subscriber does not have a present arrangement or intention to effect any distribution of any of the Securities to or through any person or entity for purposes of selling, offering, distributing or otherwise disposing of any of the Securities.
(f) Securities Legend. The Securities shall bear the following or similar legend:
“THE ISSUANCE AND SALE OF THE SECURITIES REPRESENTED BY THIS CERTIFICATE HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933, AS AMENDED, NOR APPLICABLE STATE SECURITIES LAWS. THE SECURITIES MAY NOT BE OFFERED FOR SALE, SOLD, TRANSFERRED OR ASSIGNED (I) IN THE ABSENCE OF (A) AN EFFECTIVE REGISTRATION STATEMENT FOR THE SECURITIES UNDER THE SECURITIES ACT OF 1933, AS AMENDED, OR (B) AN OPINION OF COUNSEL (WHICH COUNSEL SHALL BE SELECTED BY THE HOLDER), IN A GENERALLY ACCEPTABLE FORM, THAT REGISTRATION IS NOT REQUIRED UNDER SAID ACT OR (II) UNLESS SOLD PURSUANT TO RULE 144 OR RULE 144A UNDER SAID ACT.”
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(g) Access to Information. The Subscriber represents that the Subscriber has been furnished by ALCE during the course of this transaction with all information regarding ALCE which the Subscriber has requested or desired to know, has been afforded the opportunity to ask questions of and receive answers from duly authorized officers of ALCE concerning the terms and conditions of the Offering and has received any additional information which the Subscriber has requested. The Subscriber has been furnished with or has had access to (i) the Securities and Exchange Commission’s website and all of the ALCE’s SEC filings, (ii) the Euronext website and all of the Company’s majority shareholder’s filings under the Euronext Growth Stock Exchange Reporting Standard through the Euronext News & Disclosure Service (collectively, the “Reports”). In addition, the Subscriber has received in writing from the Company such other information concerning its operations, financial condition and other matters (such information is collectively, the “Other Written Information”), and considered all factors the Subscriber deems material in deciding on the advisability of investing in the Securities. The Subscriber has relied solely upon the information provided by ALCE in this Agreement in making the decision to invest in the Securities. The Subscriber disclaims reliance on any other statements made or information provided by any person or entity in the course of the Subscriber’s consideration of the purchase of the Securities.
(h) Risk. SUBSCRIBER UNDERSTANDS THAT THIS INVESTMENT IN THIS COMPANY IS ILLIQUID AND INVOLVES A HIGH DEGREE OF SPECULATIVE RISK. The Subscriber recognizes that the purchase of the Securities involves a high degree of risk in that, among other things, (i) ALCE is an early stage business with a limited operating history and may require funding in addition to the proceeds of the Offering, which may be done through additional equity issuances which may cause additional dilution, (ii) an investment in ALCE is highly speculative, and only an investor who can afford the loss of the Subscriber’s entire investment should consider investing in ALCE and the Securities, (iii) the Subscriber may not be able to liquidate the Subscriber’s investment, and (iv) in the event of a disposition, the Subscriber could sustain the loss of the entire investment.
(i) No Commissions or NASD Affiliation. Subscriber has not paid or received any commission or other remuneration in connection with the Offering. The Subscriber is not associated with a member firm of the National Association of Securities Dealers, Inc. The Subscriber represents that it neither is nor will be obligated for any finders’ fee or commission in connection with this transaction or the purchase of the Common Stock. The Subscriber agrees to indemnify and to hold harmless ALCE from any liability for any commission or compensation in the nature of a finders’ fee (and the costs and expenses of defending against such liability or asserted liability) for which such Subscriber is responsible.
(k) Address. The Subscriber represents that the address of the Subscriber furnished on the signature page hereof is (i) the Subscriber’s principal business address if the Subscriber is not a natural person or (ii) the Subscriber’s principal residence if the Subscriber is a natural person.
(l) Indemnification. The Subscriber agrees to indemnify and hold harmless ALCE, Inc. and its agents, representatives and employees from and against all liability, damage, loss, cost, fee and expense (including reasonable attorneys’ fees) which they may incur by reason of failure of the Subscriber to fulfill any of the terms or conditions of this Subscription Agreement, or by reason of any inaccuracy or omission in the information furnished by the Subscriber herein or any breach of the representations and warranties made by the Subscriber herein or in connection with this Subscription Agreement, or in any document provided by the Subscriber to the Company.
(n) General Solicitation. The Subscriber is not purchasing the Common Stock as a result of any advertisement, article, notice or other communication regarding the Common Stock published in any newspaper, magazine or similar media or broadcast over television or radio or presented at any seminar or any other general solicitation or general advertisement.
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5. Miscellaneous.
(a) Expenses, Etc. Each party hereto will pay its own expenses in connection with the transactions contemplated by this Agreement, whether or not such transactions shall be consummated
(b) Survival of Agreements. All covenants, agreements, representations and warranties made herein shall survive the execution and delivery of this Agreement and the issuance, sale and delivery of the Securities pursuant hereto.
(c) Parties in Interest. All covenants and agreements contained in this Agreement by or on behalf of any of the parties hereto shall bind and inure to the benefit of the respective successors and permitted assigns of the parties hereto whether so expressed or not, except for transferees in a Public Sale. For the purposes of this Agreement, “Public Sale” means any sale of securities to the public pursuant to an offering registered under the Securities Act or to the public pursuant to the provisions of Rule 144 (or any successor or similar rule) adopted under the Securities Act.
(d) Notices. All notices and other communications given or made pursuant to this Agreement shall be in writing and shall be deemed effectively given, delivered and received upon the earlier of actual receipt or: (a) personal delivery to the party to be notified, (b) when sent, if sent by facsimile during normal business hours of the recipient, and if not sent during normal business hours, then on the recipient’s next business day, (c) five (5) days after having been sent by registered or certified mail, return receipt requested, postage prepaid, or (d) one (1) business day after deposit with a nationally recognized overnight courier, freight prepaid, specifying next day or next business day delivery, with written verification of receipt. All communications shall be sent to, if to the Subscriber, such Subscriber’s address as set forth on the signature page hereto, or, if to ALCE, to the principal office of ALCE and to the attention of Mr. Vincent Browne, or to such facsimile number or address as subsequently modified by written notice given in accordance with this Section 5(d), with an email copy to Mr. Browne at [email protected]
(e) Entire Agreement; Modifications. This Agreement, together with the Stockholders Agreement, constitutes the entire agreement of the parties with respect to the subject matter hereof and may not be amended or modified nor any provisions waived except in a writing signed by ALCE and Subscriber.
(f) Counterparts. This Agreement may be executed in two or more counterparts, each of which shall be deemed an original, but all of which together shall constitute one and the same instrument.
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(g) Governing Law. This Agreement, the performance of this Agreement and any and all matters arising directly or indirectly herefrom or therefrom, including the legal relations among the parties, shall be governed by, and construed and enforced in accordance with, the laws of the State of Delaware, without regard to its conflict of laws rules. The parties hereto hereby irrevocably and unconditionally (i) agree that any action or proceeding arising out of or in connection with this Agreement shall be brought only in the State of Delaware, and not in any other state or federal court in the United States of America or any court in any other country, (ii) consent to submit to the exclusive jurisdiction of the Delaware courts for purposes of any action or proceeding arising out of or in connection with this Agreement, (iii) waive any objection to the laying of venue of any such action or proceeding in a Delaware court, and (iv) waive, and agree not to plead or to make, any claim that any such action or proceeding brought in the Delaware court has been brought in an improper or inconvenient forum.
(h) The undersigned agrees that he shall not cancel, terminate or revoke this Subscription Agreement or any agreement of the undersigned made hereunder other than as set forth herein, and that this Subscription Agreement shall survive the death or disability of the undersigned.
THE SECURITIES BEING SOLD HEREUNDER HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND EXCHANGE COMMISSION, ANY STATE SECURITIES COMMISSION OR OTHER REGULATORY AUTHORITY, NOR HAVE ANY OF THE FOREGOING AUTHORITIES PASSED UPON OR ENDORSED THE MERITS OF THE OFFERING OR THE ACCURACY OR ADEQUACY OF THIS OFFERING. ANY REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
THE SECURITIES OFFERED HEREBY HAVE NOT BEEN REGISTERED UNDER THE SECURITIES ACT, AS AMENDED, OR THE SECURITIES LAWS OF ANY STATE AND ARE BEING OFFERED AND SOLD IN RELIANCE ON EXEMPTIONS FROM THE REGISTRATION REQUIREMENTS OF SAID ACT AND SUCH LAWS. THE SECURITIES ARE SUBJECT TO RESTRICTION ON TRANSFERABILITY AND RESALE AND MAY NOT BE TRANSFERRED OR RESOLD EXCEPT AS PERMITTED UNDER SAID ACT AND SUCH LAWS PURSUANT TO REGISTRATION OR EXEMPTION THEREFROM. SUBSCRIBER SHOULD BE AWARE THAT IT WILL BE REQUIRED TO BEAR THE FINANCIAL RISKS OF THIS INVESTMENT FOR AN INDEFINITE PERIOD OF TIME.
SUBSCRIBER SHOULD CONSULT ITS OWN LEGAL COUNSEL, ACCOUNTANT AND BUSINESS AND FINANCIAL ADVISERS AS TO ALL LEGAL, TAX AND RELATED MATTERS CONCERNING ANY INVESTMENT IN ALCE.
[Remainder of Page Intentionally Left Blank; Signature Page Follows]
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SUBSCRIBER SIGNATURE PAGE
TO ALTERNUS CLEAN ENERGY INC. PURCHASE AGREEMENT
IN WITNESS WHEREOF, the undersigned have caused this Purchase Agreement to be duly executed by their respective authorized signatories as of the date first indicated above.
Name of Subscriber: ________________________________________________________
Signature of Authorized Signatory of Subscriber: __________________________________
Name of Authorized Signatory: ____________________________________________________
Title of Authorized Signatory: _____________________________________________________
Email Address of Authorized Signatory: _____________________________________________
Tax ID Number of Subscriber: __________________________________________
Address for Notice to Subscriber: __________________________________________________
Address for Delivery of Securities to Subscriber (if not same as address for notice):
Date: ___________________________
[SIGNATURE PAGES CONTINUE]
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Acknowledged, Accepted and Agreed to by:
COMPANY:
| ALTERNUS CLEAN ENERGY INC. | ||
| By: | /s/ Vincent Browne | |
| Name: | Vincent Browne | |
| Title: | Director | |
| Date: | 9/30/25 | |
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Exhibit 10.3
SETTLEMENT AGREEMENT
This Settlement Agreement (“Agreement”), dated as of September 30, 2025 (the “Effective Date”), is entered into by and between Alternus Energy Americas Inc., Alt Alliance LLC (“ALT”) and Hover Energy LLC (“Hover”). Each party may be referred to as a “Party”, and together constitute the “Parties.” Terms not otherwise defined herein shall have the same definitions as defined in the Strategic Alliance Agreement by and among the Parties dated October 31, 2023.
RECITALS
WHEREAS, on October 31, 2023, the Parties entered into a Strategic Alliance Agreement (the “SAA”), pursuant to which Hover provided certain services to ALT;
WHEREAS, as a result of the Parties entering into a joint venture, the Parties desire to terminate the SAA, and settle all rights, obligations and payments that may be owed by one Party to another Party under the SAA, subject and pursuant to the terms and conditions described in this Agreement;
NOW THEREFORE, for good and valuable consideration the receipt and sufficiency of which is hereby acknowledged, it is agreed by and between the Parties that this matter shall be settled upon the following terms and conditions:
TERMS
1. Incorporation of Recitals. The Parties acknowledge the foregoing Recitals in this Agreement are true and correct, are contractual in nature, and are hereby incorporated by reference into and made part of this Agreement.
2. Settlement.
a. The Parties hereby agree to terminate the SAA, together with all future rights, obligations and responsibilities thereunder.
b. ALT agrees to pay, and Hover agrees to accept as full and final settlement of the payment obligations under the SAA, the total sum of Five Million One Hundred Fifty Thousand Dollars ($5,150,000) (the “Total Amount”).
(i) $1,150,000 of the Total Amount shall be paid through the issuance of 1,150 shares of Series B Convertible Preferred Stock of ALCE on or about the Effective Date. Of the remaining $4,000,000, $1,700,000 shall be paid in cash through a SEC 3(a)10 process with Southern Point Capital Corporation, and the remaining $2,300,000 shall be payable in cash by ALCE at times and in amounts mutually agreed by the Parties in writing from time to time (each a “Payment”).
(ii) Payment Instructions. The Payments shall be made via electronic wire in accordance with instructions provided by Hover.
(iii) Default. Default is defined as payment not received by 5:00 p.m. within ten (10) business days of the date a Payment is due. Upon Default, the remaining Payment amount outstanding shall once again fall due immediately, irrevocably and unconditionally and shall accrue interest thereafter at a rate of eight percent (8%) per annum.
3. Parties Representations and Warranties. This Agreement has been duly and validly authorized, executed and delivered on behalf of each Party and shall constitute the legal, valid and binding obligation of each Party enforceable against each Party in accordance with its terms, except as such enforceability may be limited by general principles of equity or to applicable bankruptcy, insolvency, reorganization, moratorium, liquidation and other similar laws relating to, or affecting generally, the enforcement of applicable creditors’ rights and remedies. The execution, delivery and performance by each Party of this Agreement and the consummation by each Party of the transactions contemplated hereby will not (i) result in a violation of the organizational documents of any Party or (ii) conflict with, or constitute a default (or an event which with notice or lapse of time or both would become a default) under, or give to others any rights of termination, amendment, acceleration or cancellation of, any agreement, indenture or instrument to which any Party is a party or by which it is bound.
4. Release.
Each Party hereby releases, waives, acquits and forever discharges the other Party, and each of their and its current or former officers, directors, employees, agents, affiliates, predecessors, successors, assigns, subsidiaries and all persons acting through or with them (the “Releasees”) from any and all accounts, actions, agreements, bonds, bills, causes of action, claims, contracts, controversies, costs, covenants, damages, disputes, debts, executions, judgments, lawsuits, liabilities, obligations, promises, reckoning, security agreements, specialties, suits, sums of money, trespasses, variances of whatever kind, nature, character or description, including without limitation, claims for monies, damages, costs, expenses, losses and attorneys’, accountants, and experts’ fees and expenses, whether known or unknown, anticipated or unanticipated, suspected or unsuspected, which one Party may have or may hereafter have claim to have related to the SAA, against the Releasees.
5. Authority. The Parties represent and warrant that they possess full authority to enter into this Agreement and to lawfully and effectively release the opposing Party as set forth herein, free of any rights of settlement, approval, subrogation, or other condition or impediment. This undertaking includes specifically, without limitation, the representation and warranty that no third party has now acquired or will acquire rights to present or pursue any claims arising from or based upon the claims that have been released herein.
6. Confidentiality. The Parties agree to keep the terms of this Agreement confidential, except as disclosure may be required to enforce the terms of this Agreement or to comply with a lawful subpoena and/or by a governmental taxing authority. The Parties may also share information concerning the terms of this Agreement with their attorneys and tax advisors as necessary for purposes of obtaining legal or tax advice.
7. Waiver or Modification. No modification, amendment or waiver of any of the provisions contained in this Agreement, or any representation, promise or condition in connection with the subject matter of this Agreement shall be binding upon any Party hereto unless made in writing and signed by such Party or by a duly authorized officer or agent of such Party.
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8. Predecessors, Successors, and Assigns. All persons or business entities granting releases hereby include any assignee, predecessor in interest, or successor in interest of the respective grantor. All persons or business entities released hereby include any predecessor in liability or successor in liability for the released liability.
9. Governing Law. This Agreement, the performance of this Agreement and any and all matters arising directly or indirectly herefrom or therefrom, including the legal relations among the Parties, shall be governed by, and construed and enforced in accordance with, the laws of New York, without regard to its conflict of laws rules.
10. Complete Agreement. This Agreement constitutes and contains the entire agreement and understanding between the Parties concerning the subject matter of this Agreement and supersedes all prior negotiations, agreements or understanding between the Parties concerning any of the provisions of this Agreement. This Agreement shall be construed without regard to any presumptions against the Parties causing the same to be prepared.
11. Miscellaneous. In the event of the litigation alleging breach of this Agreement, the prevailing party shall be entitled to its costs and reasonable attorneys' fees. If any portion of this Agreement is found to be unenforceable, the Parties desire that all other portions that can be separated from it, or appropriately limited in scope, shall remain fully valid and enforceable. This Agreement may be executed in counterpart copies which taken together shall constitute one and the same agreement even though no one copy bears the Parties' signatures.
12. Execution in Counterparts. This Agreement may be executed in one or more counterparts, each of which shall be deemed to be an original, but all of which together shall constitute one and the same instrument, provided that each Party receives a signed counterpart of the other Party. An executed counterpart copy delivered by facsimile or otherwise electronically transmitted (such as via e-mail in PDF format) shall be deemed an original and have the same force and effect as an original signature. This Agreement shall not be binding unless executed by and delivered to the Parties.
[Signature Page to Follow]
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IN WITNESS WHEREOF, the Parties hereto have executed this Agreement on the dates written below.
| Alt Alliance LLC | |
| /s/ Vincent Browne | |
| By: Vincent Browne, CEO | |
| Hover Energy LLC | |
| /s/ Chris Griffin | |
| By: Chris Griffin, CEO | |
| Alternus Energy Americas Inc. | |
| /s/ Vincent Browne | |
| By: Vincent Browne, CEO |
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