Cover
Cover - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Sep. 30, 2020 | Jun. 30, 2019 | |
Cover [Abstract] | |||
Entity Registrant Name | Alternus Energy Inc. | ||
Entity Central Index Key | 0001621499 | ||
Document Type | 10-K | ||
Amendment Flag | false | ||
Entity Voluntary Filers | No | ||
Current Fiscal Year End Date | --12-31 | ||
Entity Well Known Seasoned Issuer | No | ||
Entity Small Business | true | ||
Entity Shell Company | false | ||
Entity Emerging Growth Company | true | ||
Entity Current Reporting Status | Yes | ||
Document Period End Date | Dec. 31, 2019 | ||
Entity Filer Category | Non-accelerated Filer | ||
Document Fiscal Period Focus | FY | ||
Document Fiscal Year Focus | 2019 | ||
Entity Ex Transition Period | false | ||
Entity Common Stock Shares Outstanding | 120,520,492 | ||
Entity Public Float | $ 17,000,000 | ||
Document Annual Report | true | ||
Document Transition Report | false | ||
Entity Interactive Data Current | Yes |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Current Assets | ||
Cash and cash equivalents | $ 1,076,995 | $ 1,026,533 |
Accounts receivable | 210,032 | 307,307 |
Other receivables, sale of asset | 383,819 | 531,717 |
Unbilled energy incentives earned | 0 | 164,687 |
Prepaid expenses and other current assets, short term portion | 502,054 | 334,078 |
Taxes recoverable | 610,919 | 178,995 |
Total Current Assets | 2,783,819 | 2,543,317 |
Investment in Energy Property and Equipment, Net | 33,459,478 | 14,739,767 |
Construction in Process | 7,270,194 | 6,979,080 |
Prepaid expenses and other current assets, long term portion | 396,639 | 0 |
Goodwill | 1,353,998 | 0 |
Restricted cash | 349,434 | 8,857,966 |
Total Assets | 45,613,562 | 33,120,130 |
Current Liabilities | ||
Accounts payable and accrued liabilities | 3,700,796 | 1,696,200 |
Convertible and non-convertible promissory notes, current portion | 22,705,665 | 14,510,204 |
Capital lease, current portion | 87,785 | 85,325 |
Derivative liability | 0 | 338,861 |
Taxes payable | 61,575 | 27,451 |
Total Current Liabilities | 26,555,821 | 16,658,041 |
Convertible and non-convertible promissory notes, net of current portion | 14,109,417 | 10,320,240 |
Capital lease, net of current portion | 923,948 | 1,032,453 |
Asset retirement obligation | 146,215 | 75,032 |
Total Liabilities | 41,735,401 | 28,085,766 |
Commitments and Contingencies Note 8 | 0 | 0 |
Shareholder's Equity | ||
Preferred Shares, $0.001 par value; 50,000,000 shares authorized, 5,000,000 issued and outstanding (Liquidation value of $5,000 as of December 31, 2019) | 5,000 | 0 |
Additional paid in capital | 15,442,118 | 13,164,601 |
Accumulated other comprehensive loss | (642,682) | (260,424) |
Accumulated deficit | (11,009,458) | (7,980,540) |
Total Shareholders' Equity | 3,878,161 | 5,034,364 |
Total Liabilities and Shareholders' Equity | 45,613,562 | 33,120,130 |
Class A common stock [Member] | ||
Shareholder's Equity | ||
Total Shareholders' Equity | 68,183 | 110,727 |
Common stock value | 68,183 | 110,727 |
Class B Common Stock [Member] | ||
Shareholder's Equity | ||
Total Shareholders' Equity | 15,000 | 0 |
Common stock value | $ 15,000 | $ 0 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Shareholder's Equity | ||
Preferred stock, shares par value | $ 0.001 | $ 0.001 |
Preferred stock, shares authorized | 50,000,000 | 50,000,000 |
Preferred stock, shares issued | 5,000,000 | 5,000,000 |
Preferred stock, shares outstanding | 5,000,000 | 5,000,000 |
Preferred stock, liquidation value | $ 5,000 | $ 0 |
Class B Common Stock [Member] | ||
Shareholder's Equity | ||
Common stock, shares par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 15,000,000 | 0 |
Common stock, shares issued | 15,000,000 | 0 |
Common stock, shares outstanding | 15,000,000 | 0 |
Class A Common Stock [Member] | ||
Shareholder's Equity | ||
Common stock, shares par value | $ 0.001 | $ 0.001 |
Common stock, shares authorized | 435,000,000 | 450,000,000 |
Common stock, shares issued | 68,182,602 | 110,726,725 |
Common stock, shares outstanding | 68,182,602 | 110,726,725 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE LOSS | ||
Revenues | $ 2,585,568 | $ 2,592,964 |
Cost of revenues | (738,097) | (1,278,614) |
Gross Profit | 1,847,471 | 1,314,350 |
Operating Expenses | ||
Selling, general and administrative | 4,453,155 | 1,817,567 |
Loss on disposal of investment in energy asset | 0 | 681,421 |
Depreciation and amortization | 1,193,107 | 699,573 |
Total Operating Expenses | 5,646,262 | 3,198,561 |
Loss from Operations | (3,798,791) | (1,884,211) |
Other income (expense) | ||
Interest expense | (3,210,299) | (1,412,864) |
Other Income | 0 | 480 |
Change in fair value of derivative liability | (132,976) | 0 |
Gain on bargain purchase | 4,113,148 | 1,623,883 |
Total other income | 769,873 | 211,499 |
Net Loss before Provision for Income Taxes | (3,028,918) | (1,672,712) |
Provision for Income Taxes | 0 | (180,000) |
Net Loss | $ (3,028,918) | $ (1,852,712) |
Basic and diluted loss per share | $ (0.03) | $ (0.02) |
Weighted average shares outstanding: | ||
Basic and diluted | 97,969,579 | 75,195,218 |
Comprehensive loss: | ||
Net loss | $ (3,028,918) | $ (1,852,712) |
Unrealized loss on currency translation adjustment | (382,190) | (466,299) |
Comprehensive loss | $ (3,411,108) | $ (2,319,011) |
CONSOLIDATED STATEMENT OF CHANG
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS EQUITY - USD ($) | Total | Preferred Shares [Member] | Additional Paid-in Capital [Member] | Accumulated Other Comprehensive Income/(Loss) [Member] | Accumulated Deficit [Member] | Class A common stock [Member] | Class B Common Stock [Member] |
Balance, shares at Dec. 31, 2017 | 30,000,000 | 71,476,725 | |||||
Balance, amount at Dec. 31, 2017 | $ 6,129,273 | $ 30,000 | $ 11,949,748 | $ 205,875 | $ (6,127,827) | $ 71,477 | $ 0 |
Conversion of preferred shares Series D to commons shares, shares | (30,000,000) | 30,000,000 | |||||
Conversion of preferred shares Series D to commons shares, amount | 0 | $ (30,000) | 0 | 0 | 0 | $ 30,000 | $ 0 |
Restricted shares stock compensation, shares | 9,250,000 | ||||||
Restricted shares stock compensation, amount | 516,500 | 0 | 507,250 | 0 | 0 | $ 9,250 | $ 0 |
Warrant expense related to financing | 707,603 | 0 | 707,603 | 0 | 0 | 0 | 0 |
Unrealized loss on currency translation adjustment | (466,299) | 0 | 0 | (466,299) | 0 | 0 | 0 |
Net loss | (1,852,712) | $ 0 | 0 | 0 | (1,852,712) | $ 0 | $ 0 |
Balance, shares at Dec. 31, 2018 | 110,726,725 | ||||||
Balance, amount at Dec. 31, 2018 | 5,034,364 | $ 0 | 13,164,601 | (260,424) | (7,980,540) | $ 110,727 | $ 0 |
Unrealized loss on currency translation adjustment | (382,190) | 0 | 0 | (382,190) | 0 | 0 | 0 |
Net loss | (3,028,918) | $ 0 | 0 | 0 | (3,028,918) | $ 0 | $ 0 |
Transfer of Common Shares to Preferred Shares Series E, shares | 5,000,000 | (50,000,000) | |||||
Transfer of Common Shares to Preferred Shares Series E, amount | 0 | $ 5,000 | 45,000 | 0 | 0 | $ (50,000) | $ 0 |
Transfer of Class A Common Shares to Class B Common Shares, shares | (15,000,000) | 15,000,000 | |||||
Transfer of Class A Common Shares to Class B Common Shares, amount | 0 | 0 | 0 | 0 | 0 | $ (15,000) | $ 15,000 |
Stock Compensation, shares | 22,455,876 | ||||||
Stock Compensation, amount | 1,513,214 | 0 | 1,490,758 | 0 | 0 | $ 22,456 | $ 0 |
Fair value of debt discount | 269,922 | 0 | 269,922 | 0 | 0 | 0 | 0 |
Reclassification of derivative liability | 471,837 | $ 0 | 471,837 | 0 | 0 | $ 0 | $ 0 |
Balance, shares at Dec. 31, 2019 | 5,000,000 | 68,182,601 | 15,000,000 | ||||
Balance, amount at Dec. 31, 2019 | $ 3,878,161 | $ 5,000 | $ 15,442,118 | $ (642,614) | $ (11,009,458) | $ 68,183 | $ 15,000 |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Cash Flows from Operating Activities: | ||
Net loss | $ (3,028,918) | $ (1,852,712) |
Adjustments to reconcile net (loss) to net cash (used in) provided by operations | ||
Depreciation and amortization | 1,193,107 | 699,573 |
Stock compensation costs | 1,513,214 | 516,500 |
Amortization of debt discount | 269,922 | 707,603 |
Change in fair value of derivative liability | 132,976 | 0 |
Warrant liability | 0 | 338,861 |
Loss on sale of investment in energy asset | 0 | 681,421 |
Gain on bargain purchase | (4,113,148) | (1,623,883) |
Changes in assets and liabilities, net of acquisition and disposals: | ||
Accounts receivable and other short-term receivables | 28,630 | (655,334) |
Other short term receivables | 147,898 | 0 |
Prepaid expenses | (702,780) | (129,565) |
Energy incentives earned, not yet received | 146,285 | 428,083 |
Accounts payable and accrued liabilities | 1,943,751 | 943,229 |
Net Cash (Used in) Provided by Operating Activities | (2,469,063) | 53,776 |
Cash Flows from Investing Activities: | ||
Cash used for construction in process | (55,120) | (7,003,171) |
Cash acquired in acquisitions, net | 1,076,096 | 0 |
Proceeds from sale of energy property and equipment, net | 0 | 3,760,155 |
Deposits paid under acquisition contracts | (348,782) | 0 |
Cash paid for acquisition of subsidiaries | (8,486,927) | 0 |
Cash used for energy property, and equipment net | (1,250,478) | (6,871,219) |
Net Cash Used In Investing Activities | (9,065,211) | (10,114,235) |
Cash Flows from Financing Activities: | ||
Proceeds from debt, related parties | 0 | 147,000 |
Payments of debt principal, related parties | (159,563) | 0 |
Proceeds from debt, senior debt | 5,002,577 | 23,491,575 |
Payments on debt principal, senior debt | (373,741) | (3,836,815) |
Net proceeds from lines of credit | (35,346) | 5,033 |
Payments on notes payable related to acquisition of solar parks | (1,335,889) | (282,200) |
Net Cash Provided by Financing Activities | 3,098,038 | 19,524,593 |
Effect of exchange rate on cash | (21,834) | 289,999 |
Net (decrease) increase in cash, cash equivalents and restricted cash | (8,458,070) | 9,754,133 |
Cash, cash equivalents, and restricted cash beginning of the period | 9,884,499 | 130,366 |
Cash, cash equivalents, and restricted cash end of the period | 1,426,429 | 9,884,499 |
Supplemental Cash Flow Disclosure | ||
Cash paid for interest | 1,573,936 | 281,210 |
Reclassification of derivative liability | 471,837 | 0 |
2019 Acquisition of Zonnerpark Rilland | ||
Working Capital Net | 395,058 | |
Investment in Energy Property, Net | 9,853,884 | |
Senior Bank Loan Assumed | (8,007,696) | |
Related party promissory note assumed | (1,683,436) | |
Goodwill | 1,798,113 | |
Cash paid | 2,355,923 | |
2019 Acquisition of Risen Italian operating asset | ||
Investment in Energy Property, Net | 6,131,004 | |
Cash paid | $ 6,131,004 | |
2018 Acquisition Of Liquid Sun Italian Operating Asset: | ||
Working Capital Net | 131,394 | |
Investment in Energy Property, Net | 4,177,206 | |
Cash paid | 4,308,600 | |
2018 Disposal of Tre Vallie Italian operating company | ||
Investment in Energy Property, Net | 4,346,507 | |
Less: cash received prior to close | (586,352) | |
Net Working Capital Adjustment | 246,636 | |
Loss on Sale of Asset and Related Operating Companies | (681,421) | |
Cash proceeds from sale | $ 3,325,370 |
Organization and Formation
Organization and Formation | 12 Months Ended |
Dec. 31, 2019 | |
Organization and Formation | |
Note 1- Organization and Formation | Alternus Energy Inc. (formerly Power Clouds, Inc.) (“We”, “ALTN” or the “Company”) was incorporated in the State of Colorado on January 1, 2000, then reorganized as a Nevada corporation on November 8, 2006. On September 11, 2008 the corporation changed its name from Asset Realization, Inc. to World Assurance Group, Inc. On April 24, 2015, the Company changed its name from World Assurance Group, Inc. to Power Clouds Inc. On November 29, 2018, the Company changed its name from Power Clouds Inc. to Alternus Energy Inc. and related stock ticker symbol change from PWCL to ALTN. AE Europe B.V. (formerly Power Clouds Europe B.V ) In August of 2016, the Company incorporated a new wholly owned subsidiary in the Netherlands, AE Europe B.V. (formerly named Power Clouds Europe B.V.) This company was incorporated to ultimately hold the Company’s European operating companies and sub-holding companies as appropriate. PC-Italia-01 S.R.L. (Formerly Power Clouds Wind Italia S.R.L.) In June of 2015, ALTN incorporated a company in Italy, PC-Italia-01 S.R.L. (formerly named Power Clouds Wind Italia S.R.L.). This company was incorporated to acquire Italian special purpose vehicles (SPVs), power plants and / or other assets located in Italy. PC-Italia-02 S.p.A. (Formerly PC-Italia-02 S.R.L.) In August of 2016, the Company incorporated a new company in Italy, PC-Italia-02 SRL as a wholly owned subsidiary of AE Europe B.V. This company was incorporated to acquire Italian special purpose vehicles, power plants and/or other assets located in Italy. During the quarter ended March 31, 2017, this company completed the acquisition of the Sant’Angelo Energia S.r.l. in Italy which operates a 702kW PV solar park. Subsequently, in April of 2019, PC-Italia-02 acquired four additional SPVs in Italy, CIC Rooftop 2 S.r.l., CIC RT Treviso S.r.l., SPV White One S.r.l., CTS Power 2 S.r.l. PCG_HoldCo GmbH & PCG_GP UG In June of 2018, the Company acquired 100% of the share capital of two companies in Germany which were renamed as PCG_HoldCo GmbH and PCG_GP UG immediately thereafter. These two companies were acquired in order to acquire German special purpose vehicles, PV solar parks and/or other assets located in Germany. During the year ended December 31, 2018, PCG_HoldCo completed the acquisitions of 4 SPVs in Germany, PSM 20 GmbH & Co KG, GRK 17.2 GmbH & Co KG, GRT 1.1 GmbH and PSM 40 GmbH & Co KG. In December of 2018, the Company acquired 100% of the share capital of another company in Germany which was renamed to ALTN HoldCo UG. Alternus Energy International Limited In March of 2019, the Company incorporated a new wholly owned subsidiary in Ireland, Alternus Energy International Limited. This company was incorporated to establish our European operations center. AEN 01 B.V. In June of 2019, the Company incorporated a new wholly owned subsidiary in the Netherlands, AEN 01 B.V. This company was incorporated to acquire Netherlands special purpose vehicles (SPVs), project rights and other solar energy assets in the Netherlands. During the quarter ended December 31, 2019, this company completed the acquisition of Zonnepark Rilland B.V. in the Netherlands, which operates a 11.75MW PV solar park. In summary, Alternus Energy is a holding company that operates through the following twenty operating subsidiaries as of December 31, 2019: Subsidiary Principal Activity Date Acquired / Established ALTN Ownership Country of Operation Power Clouds SRL SPV March 31, 2015 99.5%* Romania F.R.A.N. Energy Investment SRL SPV March 31, 2015 99.5%* Romania AE Europe B.V. Holding Company August 2016 100% Netherlands PC-Italia-01 S.R.L. Sub-Holding June 2015 100% (via PCE) Italy PC-Italia-02 S.p.A. SPV August 2016 100% (via PCE) Italy Sant’Angelo Energia S.r.l. SPV March 30, 2017 100% (via PC_Italia_02) Italy PCG_HoldCo GmbH Holding Company July 6, 2018 100% Germany PCG_GP UG General Partner (Management Company) August 30, 2018 100% Germany PSM 20 UG SPV November 14, 2018 100% (via PCG_HoldCo) Germany PSM 40 UG SPV December 28, 2018 100% (via PCG_HoldCo) Germany GRK 17.2 GmbH & Co KG SPV November 17, 2018 100% (via PCG_HoldCo) Germany GRT 1.1 GmbH & Co KG SPV December 21, 2018 100% (via PCG_HoldCo) Germany ALTN HoldCo UG SPV December 14, 2018 100% (via PCG HoldCo) Germany Alternus Energy International Ltd. European Operational Centre March 1, 2019 100% Ireland CIC Rooftop 2 S.r.l. SPV April 23, 2019 100% (via PC-Italia-02) Italy CIC RT Treviso S.r.l. SPV April 23, 2019 100% (via PC-Italia-02) Italy SPV White One S.r.l. SPV April 23, 2019 100% (via PC-Italia-02) Italy CTS Power 2 S.r.l. SPV April 23, 2019 100% (via PC-Italia-02) Italy AEN 01 B.V. SPV June 13, 2019 100% Netherlands Zonnepark Rilland B.V. SPV December 20, 2019 100% Netherlands Summary: *Non-controlling interest is not material |
Going Concern
Going Concern | 12 Months Ended |
Dec. 31, 2019 | |
Going Concern | |
Note 2 - Going Concern | Our consolidated financial statements for the year ended December 31,2019 identifies the existence of certain conditions that raise substantial doubt about our ability to continue as a going concern for twelve months from the issuance of this Annual Report on Form 10-K. The accompanying consolidated financial statements have been prepared on a going concern basis, which contemplates the realization of assets and the satisfaction of liabilities in the normal course of business. As shown in the accompanying consolidated financial statements during the year ended December 31, 2019, the Company had net loss of ($3,028,918) and a net loss of ($1,852,712) for the year ended December 31, 2019 and 2018, respectively. The Company had accumulated shareholders’ equity of $3,878,161 and $5,034,364 as of December 31, 2019 and December 31, 2018, respectively, and a working capital deficit of $23,772,002 and $14,114,724 as of December 31, 2019 and December 31, 2018, respectively. At December 31, 2019, the Company had $1,076,995 of cash on hand. Our operating revenues are insufficient to fund our operations and our assets already are pledged to secure our indebtedness to various third party secured creditor, respectively. The unavailability of additional financing could require us to delay, scale back or terminate our acquisition efforts as well as our own business activities, which would have a material adverse effect on the Company and its viability and prospects. The terms of our indebtedness, including the covenants and the dates on which principal and interest payments on our indebtedness are due, increases the risk that we will be unable to continue as a going concern. To continue as a going concern over the next twelve months, we must make payments on our debt as they come due and comply with the covenants in the agreements governing our indebtedness or, if we fail to do so, to (i) negotiate and obtain waivers of or forbearances with respect to any defaults that occur with respect to our indebtedness, (ii) amend, replace, refinance or restructure any or all of the agreements governing our indebtedness, and/or (iii) otherwise secure additional capital. However, we cannot provide any assurances that we will be successful in accomplishing any of these plans. The recent outbreak of the corona virus, also known as “COVID-19”, has spread across the globe and is impacting worldwide economic activity. Conditions surrounding the corona virus continue to rapidly evolve and government authorities have implemented emergency measures to mitigate the spread of the virus. The outbreak and the related mitigation measures may have an adverse impact on global economic conditions as well as on the Company’s business activities. The extent to which the corona virus may impact the Company’s business activities will depend on future developments, such as the ultimate geographic spread of the disease, the duration of the outbreak, travel restrictions, business disruptions, and the effectiveness of actions taken in the United States and other countries to contain and treat the disease. These events are highly uncertain and as such, the Company cannot determine their financial impact at this time. |
Summary of Significant Accounti
Summary of Significant Accounting Policies | 12 Months Ended |
Dec. 31, 2019 | |
Summary of Significant Accounting Policies | |
Note 3 - Summary of Significant Accounting Policies | Basis of Presentation The consolidated financial statements include the consolidated balance sheet, statements of operations and comprehensive loss, changes in shareholders’ equity and cash flows of the Company and have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) from records maintained by the Company. Basis of consolidation The consolidated financial statements as of December 31, 2019 and December 31, 2018 and for the years then ended include the accounts of the Company and the aforementioned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. The results of subsidiaries acquired or disposed of during the respective periods are included in the consolidated financial statements from the effective date of acquisition or up to the effective date of disposal, as appropriate. Use of estimates The preparation of consolidated financial statements in conformity with GAAP. requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and reported amounts of revenues and expenses for the periods presented. The most significant estimates with regard to these statements relate to the assumptions utilized in the valuation of the assets acquired, calculation of stock and warrant compensation expense, asset retirement obligations and impairment of long-lived assets. Actual results could differ from these estimates. Cash and Cash Equivalents The Company considers cash, demand deposits and highly liquid investments with maturities of less than three months when purchased to be cash and cash equivalents. The Company maintains cash and cash equivalents with major financial institutions, which may at times exceed federally insured limits. The Company periodically assesses the financial condition of the institutions and believes the risk of loss to be remote. Accounts Receivable Accounts receivable are uncollateralized customer obligations due under normal trade terms requiring payment within that period. Accounts receivable are stated at the amount management expects to collect from balances outstanding at year-end. Management establishes an allowance for doubtful customer accounts through a review of historical losses, specific customer balances, and industry economic conditions. Customer accounts are charged off against the allowance for doubtful accounts when management determines that the likelihood of eventual collection is remote. The Company extends credit based on an evaluation of customers’ financial conditions and determines any additional collateral requirements. Exposure to losses on receivables is principally dependent on each customer’s financial condition. The Company considers invoices past due when they are outstanding longer than the stated term. Additionally, the Company monitors its exposure for credit losses and maintains allowances for anticipated losses. At December 31, 2019 and 2018, management determined that an allowance for doubtful accounts was not material. Energy Property and Equipment Acquired energy property and equipment is recognized at fair value at the date of acquisition, less depreciation. Energy property constructed by the Company is recognized at its cost, less depreciation. The Company provides for depreciation utilizing the straight-line method by charges to operations over the estimated useful lives of the solar energy facilities, which is twenty years. Expenditures during the construction of new solar energy facilities are capitalized to development in progress as incurred until achievement of the commercial operation date (COD). Expenditures for maintenance and repairs are charged to expense as incurred. Upon retirement, sale or other disposition of equipment, the cost and accumulated depreciation are removed from the accounts and the related gain or loss, if any, is reflected in the year of disposal. When the Company abandons the anticipated construction of a new solar energy facility during the development phase, costs previously capitalized to development in progress are written off. Goodwill and Indefinite-Lived Intangible Assets The Company has goodwill and certain indefinite-lived intangible assets that have been recorded in connection with the acquisition of a business. Goodwill and indefinite-lived assets are not amortized, but instead are tested for impairment at least annually. Goodwill represents the excess of the purchase price of an acquired business over the estimated fair value of the underlying net tangible and intangible assets acquired. For purposes of the goodwill impairment test, the Company has determined that it currently operates as a single reporting unit. If it is determined that an impairment has occurred, the Company adjusts the carrying value accordingly, and charges the impairment as an operating expense in the period the determination is made. Although the Company believes goodwill is appropriately stated in the consolidated financial statements, changes in strategy or market conditions could significantly impact these judgments and require an adjustment to the recorded balance. Intangible Assets Intangible assets consist of long-term operating contracts acquired through the acquisition of solar energy facilities. Intangible assets are initially recognized at their fair value and are amortized over the term of the related Power Purchase Agreement (PPAs) using the straight-line method. For solar energy facilities that are purchased and then put into construction, intangible assets are recorded at cost, and are amortized over the term of the related PPAs using the straight-line method. Impairment of Long-Lived Assets The Company reviews its investment in energy property and PPAs for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. When evaluating impairment, if the undiscounted cash flows estimated to be generated by the energy property are less than its carrying amount, the differential carrying amount is determined to be not recoverable. The amount of the impairment loss is equal to the excess of the asset’s carrying value over its estimated fair value. Asset Retirement Obligation In connection with the acquisition or development of solar energy facilities, the Company may have the legal requirement to remove long-lived assets constructed on leased property and to restore the leased property to its condition prior to the construction of the long-lived assets. This legal requirement is referred to as an asset retirement obligation (ARO). If the Company determines that an ARO is required for a specific solar energy facility, the Company records the present value of the estimated future liability when the solar energy facility is placed in service. AROs recorded for owned facilities are recorded by increasing the carrying value of investment in energy property and depreciated over the solar energy facility’s useful life, while an ARO recorded for a leasing arrangement is accounted for as a liability in the initial period recognized and amortized over the term of the solar energy facility’s useful life. After initial recognition of the liability, the Company accretes the ARO to its future value over the solar energy facility’s useful life. As of December 31, 2019 and 2018, the Company’s asset retirement obligations were not material. Revenue Recognition In May 2014, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) The Company derives revenues through its subsidiaries from the sale of electricity and the sale of solar renewable energy credits. Energy generation revenue and solar renewable energy credits revenue are recognized as electricity is generated by the solar energy facility and delivered to the grid at which time all performance obligations have been delivered. Revenues are based on actual output and contractual sale prices set forth in long-term contracts. Disaggregated Revenues The following table shows the Company’s revenues disaggregated by pricing plans offered to customers: Net Revenue, by Offtake Type 2019 2018 Feed in Tariff $ 1,653,186 $ 829,794 Green Certificates 631,740 789,740 Energy Offtake Agreements 300,642 973,430 Total $ 2,585,568 $ 2,592,964 During the year ended December 31, 2019, two customers represented 56% and 30% of revenues and 37% and 9% of accounts receivable balance. During the year ended December 31, 2018, one of same customer and one different customer represented 32% and 21% of revenues. Unbilled Energy Incentives Earned The Company derives revenues from the sale of green certificates for the Romania projects. The green certificates revenues are recognized in the month they are generated by the solar project and registered with the local authority. The Company considers them unbilled at the end of the period if they have not been invoiced to a third party customer. Taxes Recoverable The Company records taxes recoverable, when there has been an overpayment of taxes due to timing of the Value Added Tax (VAT) between vendors and customers. The VAT tax can also be offset against a Country’s income taxes where the VAT was registered. Risks and Uncertainties The Company’s operations are subject to significant risk and uncertainties including financial, operational, technological, and regulatory risks including the potential risk of business failure. Also see Note 2 regarding going concern matters. Fair Value of Financial Instruments The Company measures its financial instruments at fair value under GAAP establishes a framework for measuring fair value and disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, GAAP establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three (3) levels of fair value hierarchy are described below: Level 1 Quoted market prices available in active markets for identical assets or liabilities as of the reporting date. Level 2 Pricing inputs other than quoted prices in active markets included in Level 1 that are either directly or indirectly observable as of the reporting date. Level 3 Pricing inputs that are generally observable inputs and not corroborated by market data. Financial assets are considered Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption or input is unobservable. The Company has level 3 assets and liabilities consisting of asset retirement obligations and warrant liabilities. The asset retirement obligations are not material. As of April 15, 2019 the exercise price of the warrants previously issued in conjunction with the Inmost note became fixed at a price of $0.122 and the derivative liability of $471,837 was reclassified to equity. During the year ended December 31, 2019, the Company recorded a change in fair value of $132,976. December 31, 2019 December 31, 2018 Balance - beginning of the year 338,861 -- Derivative liability 338,861 Change in fair value of derivative liability 132,976 - Reclassification of derivative liability (471,837 ) - Balance - end of year - 338,861 We valued the derivative using the Black Scholes method. We calculated the stock price as of the data of revaluation, with a remaining term of the warrants of 2.5 years. The volatility was calculated at 3.3 using the historical stock price and share volume of the company. We used 2.94% as the risk free rate, based on the Treasury rates for the similar period. The warrants were valued using the floor price of $0.122 with a valuation date of April 15, 2019. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. If the inputs used to measure the financial assets and liabilities fall within more than one level described above, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument. The carrying amount of the Company’s financial assets and liabilities, such as cash, accounts payable, approximate their fair value because of the short maturity of those instruments. Income Taxes Deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences, operating loss and tax credit carry forwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax basis. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. As of December 31, 2019 and 2018, the Company has U.S. federal and state net operating loss carryovers of approximately $4,667,136 and $1,727,412 respectively, which will expire at various dates beginning in 2034 through 2037, if not utilized with exception of loss carryovers generated in 2018 and 2019. As a result of Tax Cuts and Jobs Act, net operating losses generated in 2018 and beyond have indefinite lives, but limited to 80% of taxable income in each year. Additionally, as of December 31, 2019 and 2018, the Company has U.S. federal capital loss carryovers of approximately $949,875 and $949,875 respectively, which will expire at various dates beginning in 2020 through 2022, if not utilized against capital gain income. In accordance with Section 382 of the internal revenue code, deductibility of the Company’s U.S. net operating loss carryovers may be subject to an annual limitation in the event of a change of control as defined under the Section 382 regulations. Quarterly ownership changes for the past 3 years were analyzed and it was determined that there was no change of control as of December 31, 2019. In assessing the realization of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. After consideration of all of the information available, management believes that significant uncertainty exists with respect to future realization of the deferred tax assets and has therefore established a full valuation allowance. For the years ended December 31, 2019 and 2018, the change in valuation allowance was $926,792 and $960,552, respectively. As of December 31, 2019 and 2018, the valuation allowance was $1,887,344 and $960,552, respectively. The Company evaluated the provisions of ASC 740 related to the accounting for uncertainty in income taxes recognized in their financial statements. ASC 740 prescribes a comprehensive model for how a company should recognize, present, and disclose uncertain positions that the company has taken or expects to take in its return. For those benefits to be recognized, a tax position must be more-likely-than- not to be sustained upon examination by taxing authorities. Differences between two positions taken or expected to be taken in a tax return and the benefit recognized and measured pursuant to the interpretation are referred to as “unrecognized benefits”. A liability is recognized for an unrecognized tax benefit because it represents an enterprise’s potential future obligation to the taxing-authority for a tax position that was not recognized as a result of applying the provisions of ASC 740. Penalties and interest assessed by income tax authorities would be included in income tax expense. For the period ended December 31, 2019 and 2018, the Company did not incur any penalties or interest. As of December 31, 2018, the Company accrued $180,000 related to noncompliance of administrative filing for their foreign entities for the periods 2012 – 2017. Stock-Based Compensation The Company accounts for stock-based compensation in accordance with ASC 718. Under the fair value recognition provisions of this statement, stock-based compensation cost is measured at the grant date based on the fair value of the award and is recognized as expense on a straight-line basis over the requisite service period, which is the vesting period. Net loss per common share Net loss per common share is computed pursuant to section 260 of the FASB Accounting Standards Codification. Basic net loss per common share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period. Diluted net loss per common share is computed by dividing net loss by the weighted average number of shares of common stock and potentially outstanding shares of common stock during the period to reflect the potential dilution that could occur from common shares issuable through contingent shares issuance arrangement, stock options or warrants. As of December 31, 2019, the Company had 5,000,000 shares of Series E Convertible Preferred Stock which convert into 50,000,000 shares of common stock, 13,053,235 of warrants, and 8,828,233 of convertible shares associated with debt issuance for a total of 71,881,468 shares of Class A common stock. As of December 31, 2018, the Company had 12,286,213 of warrants, and 4,360,105 of convertible shares associated with debt issuance for a total of 16,646,318 shares of Class A common stock. These shares were not included because they were anti-dilutive. Foreign Currency and Other Comprehensive Loss The functional currency of our foreign subsidiaries is typically the applicable local currency which is Romania Lei, Japanese Yen or European Union Euros. The translation from the respective foreign currency to United States Dollars (U.S. Dollar) is performed for balance sheet accounts using current exchange rates in effect at the balance sheet date and for income statement accounts using an average exchange rate during the period. Gains or losses resulting from such translation are included as a separate component of accumulated other comprehensive income. Gains or losses resulting from foreign currency transactions are included in foreign currency income or loss except for the effect of exchange rates on long-term inter-company transactions considered to be a long-term investment, which are accumulated and credited or charged to other comprehensive income. Transaction gains and losses are recognized in our results of operations based on the difference between the foreign exchange rates on the transaction date and on the reporting date. The Company had a immaterial net foreign exchange loss for the period ended December 31, 2019 and 2018, respectively. The foreign currency exchange gains and losses are included as a component of general and administrative expenses in the accompanying Consolidated Statements of Operations and Comprehensive (Loss). For the period ended December 31, 2019 and 2018, the increase (decrease) in accumulated comprehensive gain (loss) was ($382,190) and ($466,299), respectively. Preferred Stock We apply the accounting standards for distinguishing liabilities from equity under U.S. GAAP when determining the classification and measurement of our convertible preferred stock. Preferred Stock subject to mandatory redemption is classified as liability instruments and is measured at fair value. Conditionally redeemable Preferred Stock (including preferred stock that features redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within our control) is classified as temporary equity. At all other times, preferred stock is classified as permanent equity. As of December 31, 2019, the Company had 5,000,000 shares of Series E Convertible Preferred Stock issued and outstanding which convert into 50,000,000 shares of common stock. The Series E Convertible Preferred, with respect to dividends, rank pari passu with the Common Stock, and with respect to distributions upon liquidation, dissolution or winding up of the Company, rank senior to the Common Stock and junior to any other series of Preferred Stock. Subsequent Events The Company follows the guidance in Section 855 of the FASB Accounting Standards Codification for the disclosure of subsequent events. The Company will evaluate subsequent events through the date when the financial statements were issued. Pursuant to ASU 2010-09 of the FASB Accounting Standards Codification, the Company considers its financial statements issued when they are widely distributed to users, such as through filing them with OTC Markets. No subsequent events required disclosure except for those in Note 11. Recent Accounting Standards Adopted On January 1, 2019, the Company adopted ASU 2016-18. The adoption had an impact on the Company’s beginning of the period and end of the period cash and cash equivalents balance in its statement of cash flows. Restricted cash at the end of December 31, 2019 was related to debt service reserve and maintenance reserves required by third party senior lender. The restricted cash at the end of December 31, 2108 related to future acquisition of Italian parks that was completed in 2019. The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported in the consolidated balance sheet that equals the total of the same amounts reported in the consolidated statement of cash flows: December 31, 2019 December 31, 2018 Cash and cash equivalents $ 1,076,995 $ 1,026,533 Restricted cash 349,434 8,857,966 Total cash, cash equivalents, and restricted cash $ 1,426,429 $ 9,884,499 In June 2018, the FASB issued ASU No. 2018-07, Compensation – Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting st Recent Accounting Standards Not Adopted In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), to increase transparency and comparability among organizations by recognizing a right-of-use asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either operating or financing, with such classifications affecting the pattern of expense recognition in the income statement. ASU 2016-02 is effective for fiscal years beginning after December 15, 2019, and early adoption is permitted. ASU 2016-02 was recently delayed for emerging growth companies that elected to adopt new accounting standards on the adoption date required for private companies and will be effective for the Company’s annual reporting period in 2022 and interim periods beginning first quarter of 2023. The Company is evaluating the impact ASU 2016-02 will have on its financial statements and associated disclosures. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit losses (Topic 326). This new guidance will change how entities account for credit impairment for trade and other receivables, as well as for certain financial assets and other instruments. The update will replace the current incurred loss model with an expected loss model. Under the incurred loss model, a loss (or allowance) is recognized only when an event has occurred (such as a payment delinquency) that causes the entity to believe that a loss is probable (that is has been “incurred”). Under the expected loss model, a loss (or allowance) is recognized upon initial recognitions of the asset that reflects all future events that leads to a loss being realized, regardless of whether it is probable that the future event will occur. The incurred loss model considers past events and conditions, while the expected loss model includes expectations for the future which have yet to occur. ASU 2018-19 was issued in November 2018 and excludes operating leases from the new guidance. The standard will require entities to record a cumulative-effect adjustment to the balance sheet as of the beginning of the first reporting period in which the guidance is effective. As an Emerging Growth Company, the standard is effective for the Company’s 2022 annual reporting period and interim periods beginning first quarter of 2023. The Company is evaluating the impact of ASU 2016-13 will have on its financial statements and associated disclosures. On December 18, 2019, the FASB issued Accounting Standards Update 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (the ASU), as part as part of its overall simplification initiative to reduce costs and complexity of applying accounting standards while maintaining or improving the usefulness of the information provided to users of financial statements. The FASB’s amendments primarily impact ASC 740, Income Taxes, and may impact both interim and annual reporting periods. The Company is currently evaluating the effect that the adoption of ASU 2019-12 will have on its consolidated financial statement. The guidance is effective January 1, 2021 with early adoption permitted. |
Acquisitions and dispositions
Acquisitions and dispositions | 12 Months Ended |
Dec. 31, 2019 | |
Acquisitions and dispositions | |
Note 4 - Acquisitions and dispositions | 2019 Acquisition of Zonepark Rilland. On December 20, 2019, AEN 01 BV (“Buyer”), a Netherlands company and a wholly-owned subsidiary of Alternus Energy Inc. (“ALTN”), completed the acquisition of an 11.75 MW ground-mounted solar photovoltaic (PV) power plant in Rilland, the Netherlands (the “Project”) from Coöperatie Unisun Energy U.A., a Netherlands corporation (“Seller”) for $11.7 million plus a working capital adjustment (“Purchase Price”). The Purchase Price includes the assumption of a third-party senior bank debt facility in the amount $8.3 million, that amortizes equally over the next 14 years. We also acquired the various offtake and operations contracts for the solar plant. In addition to the Purchase Price, the Seller will be entitled to receive additional consideration from ALTN of up to a maximum $560,000 in the form of an earn-out payment based on net cash proceeds to equity received over and above a set annual power output of 10,865 MwH. (See Note 7 for details on the debt associated with the acquisition). The Project has been operational since January 2019 and enjoys a 15-year government counterparty ‘Feed-in-Tariff’ (“FiT”) contract at fixed sales prices, in addition to a Power Purchase Agreement (“PPA”) with a local energy operator. The combined contracts provide long-term predictable positive cash flows to Alternus. Based on current energy production Rilland is expected to add approximately $1.3 million in annual revenues for at least 15 years at average 75% gross margins to Alternus. The Buyer funded $2.1 million of the Purchase Price through the issuance of a $2.4 million issued to an accredited investor, bearing interest at 8%, amortizing over 8 years and secured by collateral, including the shares of the Buyer. ALTN incurred approximately $0.6 million in transaction fees related to the acquisition, some of which were paid from the proceeds of the Bond Subscription Agreement. Additionally, the Seller issued a $1.9 million loan to ALTN which is due by January 31, 2020 (the “Loan”), pursuant to a Loan Agreement by and among the Seller, the Buyer and ALTN. If ALTN does not repay the Loan by February 1, 2020, the investor has the right under the Call Option Agreement to require ALTN to sell the shares of Buyer to the investor in exchange for the total amount of the Loan (See note 12-subsequent events) . Cost of Acquisition Acquisition price $ 11,651,997 Net working capital acquired 419,011 Total Acquisition Cost 12,071,008 Fair Value of Assets Acquired Present value of the future cash flows 9,853,884 Net working capital acquired 419,011 10,272,895 Goodwill $ 1,798,113 2019 Acquisition of Risen Energy SPV. In April 2019, PC-Italia-02 S.R.l., a wholly owned subsidiary of Alternus Energy Inc.’s (the “Company”) Netherlands’ subsidiary, completed the acquisition of 100% of the share capital of 4 out of 5 SPVs (Special Purpose Vehicles) the Company planned to purchase under a definitive sale and purchase agreement signed with Risen Energy PV Holding Italy GmbH and Risen Energy (HongKong) Co., Limited. The total acquisition consisted of 7 operating photovoltaic plants located in Italy having a total installed capacity of 5.1 MWs in exchange for approximately $8.1M cash, less $1.5M held back for the acquisition of the 5 th Business Combinations. The fair value of the purchase consideration issued to the sellers of the project was allocated to the net assets acquired. The Company accounted for the acquisition as the purchase of a business under U.S. GAAP under the acquisition method of accounting, and the assets and liabilities acquired were recorded as of the acquisition date at their respective fair values and consolidated with those of the Company. The fair value of the net assets acquired was approximately $9.9 million. The excess of the aggregate fair value of the net tangible assets has been treated as a gain on bargain purchase in accordance with ASC 805. The purchase price allocation was based, in part, on management’s knowledge of the project and the results of a fair value assessment that the Company performed. The Company then undertook a review to determine what factors might contribute to a bargain purchase and if it was reasonable for a bargain purchase to occur. The main reason for the bargain purchase price was a motivated seller who was looking to exit the business. The seller is manufacture of product for the solar industry and not an operator. Part of their strategy to increase product sales is to develop and construct solar projects. The seller is not a long-term operator like Alternus, so their strategy is to not keep operating assets on their books for the long-term. Also, because of the small size of the operating assets we purchased and the fact that they were spread out across Italy made it more difficult for Risen to manage the assets since they are not an operator. This led to their willingness to sale the assets at a market discount. Subsequent to the acquisition of Risen facility, Alternus Energy signed a letter of intent with Risen to purchase an additional 10MWs of similar solar Projects at a price of 18.5M (euros). The price per MW was 1.85M (Euros) for an uninstalled asset as compared to the 1.35M (euros) they sold the operating asset for. This further supports that the Company position that Risen was a motivated seller and did not want to be an operator. Further, at the time of sale, Alternus has no side agreement or other commitment to purchase any assets from Risen. Total Cost of acquisitions Cash paid for assets $ 6,131,004 Total acquisition cost $ 6,131,004 Fair value of assets acquired Investment in energy property 9,939,414 Net working capital acquired 384,397 Asset retirement liability (65,114 ) $ 10,258,697 Gain on bargain purchase $ 4,127,693 2018 Acquisition of PSM 20 GmbH & Co KG: On June 7, 2018, ALTN entered into a Purchase and Transfer Agreement, to acquire PSM 20 GmbH & Co KG (“PSM”),$115 in cash paid and the deposit of approximately $1.3M in cash deposited into an escrow account pursuant to an Escrow Agreement by and among the Company, as part of the above transaction, the Seller is constructing 7 photovoltaic installations with a total of 3,084 KW of power. 2018 Acquisition of GRK 17.2 GmbH & Co KG: On November 20, 2018, Alternate Energy’s wholly owned German subsidiary, PCG_HoldCo UG (“PCG”) entered into a Purchase and Transfer Agreement (pursuant to which PCG purchased one hundred percent (100%) of GRK 17.2’s entire share capital in exchange for $115 in cash paid at Closing and the deposit of approximately $419,408 in cash deposited into GRK 17.2.As part of the above transaction, the Seller is constructing 7 photovoltaic installations s in Germany with a total of 2,521KW of power. 2018 Acquisition of PSM 40 GmbH & Co KG: On or about December 28, 2018, Alternate Energy’s wholly owned German subsidiary, PCG_HoldCo UG (“PCG”) entered into a Purchase and Transfer Agreement pursuant to which PCG purchased 100% of the share capital of PSM 40 in exchange for i) $115.00 in cash paid at Closing and ii) $570,000 in cash, a portion of which, $427,500, was immediately paid and the remaining $142,500 will be disbursed when certain conditions being met related to Grid Connection. As part of the above transaction, the Seller is constructing 6 photovoltaic installations in Germany with a total of 2,645kW of power. 2018 Acquisition of GRT 1.1 GmbH: On or about December 21, 2018 , PCG_HoldCo UG (“PCG”), a wholly owned German subsidiary of ALTN entered into a Share Purchase and Assignment Agreement for the purchase of 100% of the share capital of GRT 1.1 GmbH (“GRT 1.1”) in exchange for i) $26,434 in cash paid at Closing, ii) the repayment of a third party cash advance in the amount of $160,845, iii) full settlement of third party liabilities in the amount of $43,046, and iv) the assumption of a senior bank loan in the amount of $876,005. As part of the above transaction, the Seller is constructing 5 photovoltaic installations in Germany with a total of 2,100 KW of power. 2018 Acquisition of Liquid Sun S.R.L. On December 18, 2018, PC_Italia_02 S.R.l., a wholly owned subsidiary of Power Clouds Europe BV (“PC Europe”), ALTN’s Netherlands’ subsidiary, closed the acquisition of certain assets, agreements and liabilities of Liquid Sun Srl, an Italian company, related to three photovoltaic installations located on three power plants with a total of 2,244.37 KW of power located in the Budrio and Anagni regions of Italy in exchange for approximately $4.3M, plus working capital, and transaction costs, commissions and required Italian taxes. The fair value of the purchase consideration issued to the sellers of the project was allocated to the net assets acquired. The Company accounted for the acquisition as the purchase of a business under U.S. GAAP under the acquisition method of accounting, and the assets and liabilities acquired were recorded as of the acquisition date at their respective fair values and consolidated with those of the Company. The fair value of the net assets acquired was approximately $5.8 million. The excess of the aggregate fair value of the net tangible assets has been treated as a gain on bargain purchase in accordance with ASC 805. The purchase price allocation was based, in part, on management’s knowledge of the project and the results of a fair value assessment that the Company performed. The Company then undertook a review to determine what factors might contribute to a bargain purchase and if it was reasonable for a bargain purchase to occur. The main reason for the bargain purchase price was a motivated seller who was looking to exit the business. The seller is a supplier to the solar industry and their strategy is to not keep assets on their books for the long-term. Acquisition Cost Cash paid for assets $ 4,177,206 Taxes paid at closing 131,394 Total acquisition cost 4,308,600 Fair value of assets acquired NPV of discounted cash flow 5,790,731 Net working capital acquired 148,685 Less asset retirement obligation (57,013 ) Net fair value of assets acquired $ 5,882,403 Gain on bargain purchase $ 1,573,803 2018 Disposition of Tre Valli Energia S.R.L On September 30, 2018, PC Italia 01 S.R.L. sold 100% of the share capital of Tre Valli Energia S.R.L. The net aggregate consideration received in exchange for the sale was $3,760,155. Proceeds from sale $ 3,760,155 Net carrying cost of asset at time of sale (4,688,212 ) Net working capital adjustment 246,636 Loss on sale of asset and related operating companies $ (681,421 ) Proforma Results The following presents the twelve months unaudited proforma combined results of operations as if the entities were combined on January 1, 2018: 2019 2018 Revenues, net $ 4,347,671 $ 4,011,556 Net (loss) $ (6,544,295 ) $ (3,208,498 )) Net (loss) per share $ (0.07 ) $ (0.04 ) Basic weighted average number of shares outstanding 97,969,579 71,600,361 |
Investment in Energy Property a
Investment in Energy Property and Equipment, Net | 12 Months Ended |
Dec. 31, 2019 | |
Investment in Energy Property and Equipment, Net | |
Note 5 - Investment in Energy Property and Equipment, Net | As of December 31, 2019, the Company had $33,459,478 of net investment in energy property, as outlined in the table below. December 31, 2019 December 31, 2018 Solar energy facilities operating $ 36,123,412 $ 16,278,252 Less accumulated depreciation and amortization (2,663,934 ) (1,538,485 ) Net Assets $ 33,459,478 $ 14,739,767 The estimated useful life remaining on the investment in energy property and intangible asset is between 14 and 20 years. Depreciation and amortization expense for the nine months ended December 31, 2019 and 2018, was $1,193,107 and $699,573, respectively. The Company leases various equipment under capital leases. Assets held under capital leases are included in property and equipment as follows: December 31, 2019 December 31, 2018 Capitalized costs relating to PV plants $ 2,311,255 $ 2,358,588 Less accumulated amortization (321,821 ) (208,989 ) Net Assets $ 1,989,434 $ 2,149,599 |
Capital Leases
Capital Leases | 12 Months Ended |
Dec. 31, 2019 | |
Capital Leases | |
Note 6 - Capital Leases | We have acquired equipment through a capital lease obligations for the Sant’Angelo park in Italy. As of December 31, 2019, there was $1,011,734 remaining on the lease of which $87,785, net of interest, was the short-term portion. The lease commenced in 2011, has a term of 18 years and will expire in September 2029. Interest is calculated on the outstanding principal based on EURIBOR 3 months (EUR3M) plus an agreed margin for the lender. The average interest rate based on previous years is approximately 4.5% per annum. This interest amount may vary due to future changes in EUR3M index. Capital lease future minimum payments for each of the next five years and thereafter is as follows: 2020 140,009 2021 140,009 2022 140,009 2023 140,009 2024 140,009 Thereafter 606,704 1,306,749 Less Interest Expense (295,015 ) $ 1,011,734 |
Convertible and Unconvertible P
Convertible and Unconvertible Promissory Notes | 12 Months Ended |
Dec. 31, 2019 | |
Convertible and Unconvertible Promissory Notes | |
Note 7 - Convertible and Unconvertible Promissory Notes | The following table reflects the total debt balances of the Company as of December 31, 2019 and December 31, 2018: December 31, 2019 December 31, 2018 Short term line of credit $ 35,120 $ 73,560 Promissory notes related parties 48,821 207,753 Convertible notes related parties 291,540 284,000 Senior secured debt 19,575,794 10,192,603 Promissory notes 15,478,536 13,278,803 Convertible promissory notes 2,169,401 1,097,289 Gross debt 37,599,212 25,134,007 Debt discount (784,130 ) (303,563 ) Net debt 36,815,082 24,830,444 Less current maturities (22,705,665 ) (14,510,204 ) Long Term Debt, net of current maturities $ 14,109,418 $ 10,320,240 2020 2021 2022 2023 2024 Thereafter Total Gross debt $ 23,129,751 $ 1,102,888 $ 1,108,229 $ 1,113,219 $ 1,118,312 $ 10,026,813 $ 37,599,212 Debt discount (424,084 ) (360,046 ) (784,130 ) Net debt $ 22,705,667 $ 742,842 $ 1,108,229 $ 1,113,219 $ 1,118,312 10,026,813 $ 36,815,082 Line of Credit: In 2016, Power Clouds S.R.L entered into a 300,000 RON ($77,000) line of credit with OTP Bank. The credit line is a revolving credit facility available for the payment of trade payables up to the agreed limit. The initial term is twelve months which was renewed by agreement of both parties. Drawn funds accrue interest annually at a rate of ROBOR 3M + 3.3%, which was 6.64% as of December 31, 2019 and 6.6% as of December 31, 2018. The Company had used $35,120 and $73,560 of the facility as of December 31, 2019 and 2018. Related Party Promissory Notes: As of December 31, 2019 and 2018, there was an advance from PCH of $48,821 and $207,753 which is short term in nature and non-interest bearing. Related Party Convertible Notes: In February of 2019, the terms under which all cash previously loaned by VestCo Corp., a company owned and controlled by, the Company’s CEO, to the Company to date has been amended and restated, pursuant to which the Corporation executed a Securities Purchase Agreement with VestCo Corp. and issued to VestCo Corp. i) a convertible promissory note with a 15% OID, and therefore having a Principal Amount of $291,540, having a two year term, secured behind a third party accredited investor via a US UCC filing on all assets of the Corporation, having a call option right for the noteholder, a redemption right for the Corporation, and convertible at $0.20 per share, and ii) a warrant to purchase up to 619,522 shares of the Corporation’s Class A common stock, exercisable at $0.25 per share or through its cashless exercise provision and having a 4 year term. As at December 31, 2018, $284,000 was past due under loan notes issued to the CEO, VestCo Corp, and therefore classified as current. Senior secured debt: In 2016, the Company guaranteed a 6.5 million RON (equivalent to approximately US$1,592,500) promissory note issued by one of its subsidiaries, Power Clouds S.R.L., a Romanian company (“Power Clouds Romania”) to OTP Bank in Romania, which is secured in first position against the Romanian solar parks and customer contracts held by Power Clouds Romania, accruing interest annually at a rate of ROBOR 3M + 3.3% and having a term of 60 months. The Company had principal outstanding of $423,783 and $698,820 as of December 31, 2019 and 2018. The net book value of the collateralized asset was $2,766,577 and $3,055,976 as of December 31, 2019 and 2018. In October of 2018, in order to complete additional solar park acquisitions in Germany, the Company entered into the following agreements with a third party accredited investor (the “Lender”), in connection with the Company’s German subsidiary, PCG_HoldCo UG (PCG) with an interest rate of 12% and a term of 2 years. The Company had principal outstanding of $3,585,366 and $3,644,585 as of December 31, 2019 and 2018. In December of 2018, PSM 20 GmbH & Co KG entered into a senior secured loan with Sparkase Bank in Germany. This relates to the acquisition of 7 photovoltaic installations as part of the PSM 20 GmbH & Co KG acquisition with an interest rate of 2.10% and a term of 18 years. In April of 2018, PSM 40 GmbH & Co KG entered into a senior secured loan with GLS Bank in Germany. This relates to the acquisition of 6 photovoltaic installations as part of the PSM 40 GmbH & Co KG acquisition with an interest rate of 2.0% and a term of 18 years. The Company had principal outstanding of $2,515,866 and $2,529,212 as of December 31, 2019 and 2018. The net book value of the collateralized asset was $3,069,655 and $3,191,370 as of December 31, 2019 and 2018. In October of 2018, GRT 1.1 GmbH entered into a senior secured loan with MVB Bank in Germany. This relates to the acquisition of 1 photovoltaic installations as part of the GRT GmbH acquisition, with an interest rate of 2.05% and a term of 19 years. The Company had principal outstanding of $671,446 and $718,683as of December 31, 2019 and 2018. The net book value of the collateralized asset was $820,857 and $881,724 as of December 31, 2019 and 2018. In December of 2019, as part of the acquisition of Zonnepark Rilland BV In December of 2019, as part of the acquisition of Zonnepark Rilland BV we entered into a $2.4 million bond offering issued by an accredited investor, bearing interest at 8%, amortizing over 8 years. The Company had principal outstanding of $2,411,167 as of December 31, 2019. Promissory Notes: In December of 2018, in order to complete additional solar park acquisitions in Italy, the Company entered into the following agreements with a third party accredited investor (the “Lender”), in connection with the Company’s German subsidiary, PCG_HoldCo UG (PCG) issuing a loan note, with an interest rate of 12% and a term of 6 months. The Company had principal outstanding of $504,667 and $4,421,147 as of December 31, 2019 and 2018. In December of 2018, in order to complete additional solar park acquisitions in Italy, the Company entered into the following agreements with a third party accredited investor (the “Lender”), in connection with the Company’s Netherlands subsidiary, Power Clouds Europe B.V. (PCE) issuing a loan note, with an interest rate of 12% and a term of 6 months. The Company had principal outstanding of $8,857,656 as of December 31, 2018 and the loan was repaid in 2019. In March of 2019, in order to complete additional solar park acquisitions in Italy, the Company entered into certain loan agreement with a third party accredited investor (the “Lender”), in connection with the Company’s Netherlands subsidiary, AE Europe B.V, with an interest rate of 12% and a term of twelve months. The proceeds of which were used to pay down existing senior secured debt. The Company had principal outstanding of $3,398,063 as of December 31, 2019. In June of 2019, the Company entered into certain agreements with a third party accredited investor (the “Lender”), in connection with the Company’s Netherlands subsidiary, AE Europe B.V, with an interest rate of 7.5% until October of 2019 and then 10% thereafter and a term of ten months. The proceeds of which were used to pay down existing senior secured debt. The Company had principal outstanding of $9,676,069 as of December 31, 2019. The loan maturity date was extended until May 31, 2020. In December of 2019, as part of the acquisition of Zonnepark Rilland BV, we issued a $1.9 million loan to the Seller which is due January 31, 2020, with no interest rate. The Company had principal outstanding of $1,895,137 as of December 31, 2019 (see note 12 subsequent events). On September 30, 2015, as part of the transaction with World Global Assets Pte. Ltd. (WGA), in conjunction with the spin out of WRMT, $492,000 was assigned to various third parties, is not convertible, with interest of 7.5% and a maturity date of December 31, 2020. The Company had principal outstanding of $509,267 as of December 31, 2019 and December 31, 2018, which was included in convertible promissory notes in the above table. Convertible Promissory Notes: On September 30, 2015, the Company issued a convertible loan note for $1,000,000 to World Global Assets Pte. Ltd. (WGA), in conjunction with the spin out of WRMT. The note had a three-year term, accrued no interest, and was convertible at a fixed price of $0.20 per share, subject to certain triggers and restrictions. In 2016 a portion of the convertible loan note of approximately $300,000 was assigned to various third parties and is now convertible at market price, with a floor price of $0.20 per share. The Company had principal outstanding of $244,800 and $244,800 as of December 31, 2019 and 2018. In July of 2018, the Company issued a convertible promissory noteto a third party foreign investor in exchange for a cash provided to the Company for working capital purposes. The note accrues 15% annual interest and is convertible into shares of restricted common stock at $0.20 per share, at the noteholder’s option, and is repayable on January 30, 2020. As the conversion price was above the market price at the time of at the time of issuance of the note no beneficial costs were recorded. The Company had principal outstanding of $304,294 and $251,666 as of December 31, 2019 and 2018. In July of 2018, the Company issued a €80,000 convertible promissory note to a third party foreign consultant in exchange for sales commissions owed. The note accrues 15% annual interest and is convertible into shares of restricted common stock at $0.20 per share, at the noteholder’s option, and is repayable on January 30, 2020. As the conversion price was above the market price at the time of at the time of issuance of the note no beneficial costs were recorded. The Company had principal outstanding of $89,718 and $91,555 as of December 31, 2019 and 2018. In February of 2019, the Company entered into a Securities Purchase Agreement with 4 accredited investors (the “Lenders”), in connection with an investment of a total amount of $300,000, and pursuant to which the Company issued i) a convertible promissory note with a 15% OID, having a two year term, secured behind a third party accredited investor via a US UCC filing on all assets of the Company, having a call option right for the noteholder, a redemption right for the Corporation, and convertible at $0.20 per share., and ii) a warrant to purchase shares of the Corporation’s Class A common stock equal to 50% of the total number of shares if the Note is fully converted, divided by the Exercise Price of $0.25, (equal to a total of 750,000 warrants) subject to adjustment as provided therein, exercisable at $0.25 per share or through its cashless exercise provision and having a 4 year term. The Company recorded a debt discount of $123,805 related to the warrants issued for both the February 2019, related party note and convertible promissory note. The Company had principal outstanding of $294,118 as of December 31, 2019. In May of 2019, the Corporation entered into Securities Purchase Agreements with 4 accredited investors (the “Lenders”), in connection with an investment of up to a total amount of $150,000, and pursuant to which the Corporation issued a convertible promissory note with a 15% OID, having a two year term, secured behind an accredited investors via a US UCC filing on all assets of the Corporation, having a call option right for the noteholder, a redemption right for the Corporation, and convertible at $0.25 per share, and a warrant to purchase shares of the Corporation’s Class A common stock equal to 25% of such Lender’s investment divided by the Conversion Price of $0.25, subject to adjustment as provided therein, exercisable at $0.30 per share and having a 3 year term. We recorded $36,000 for the warrant cost allocated to debt discount and $110,118 for the beneficial conversion cost related to the convertible debt. The Company had principal outstanding of $176,471 as of December 31, 2019. In May of 2019, the Corporation entered into a Securities Purchase Agreement with another accredited investor (the “Lender”), in connection with an investment of $500,000, and pursuant to which the Corporation issued a convertible promissory note accruing 12% interest per annum with bi-annual interest payments, having a two year term, senior in priority to all obligations of the Company other than the Company’s obligations to an accredited investor and its affiliated investment funds, or a similar replacement thereto, having a call option right for the noteholder, a redemption right for the Corporation, and convertible at $0.25 per share. The Company had principal outstanding of $500,000 as of December 31, 2019. In November of 2019, the Company issued two convertible promissory notes to two accredited investors in the amount of $280,000 each, convertible at 70% of the lowest trading price of the Company’s Common Stock for the last 15 trading days prior to conversion, and accruing 12% interest per annum and each having a $25,000 original issue discount, with a maturity date of November 21, 2020. As part of the consideration for this investment, the Company issued 145,000 shares of restricted Class A common stock to each of the investors, as well as 725,000 shares of restricted Class A common stock to each investor that shall be returned to the Company provided that the Company repays the Notes in full by May of 2020. The Company had principal outstanding of $560,000 as of December 31, 2019. |
Commitments and Contingencies
Commitments and Contingencies | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies | |
Note 8 - Commitments and Contingencies | Litigation The Company is not currently involved in or aware of any litigation that could result in a loss, other than the following: On February 11, 2020 Unisun obtained leave from the interim relief judge of the Court of Amsterdam for three prejudgment attachments on the shares of 3 subsidiaries of Alternus, to secure an outstanding amount owed pursuant to an outstanding loan of EUR 1,689,864 plus interest and agreed penalties. Unisun also started proceedings on the merits to claim the amounts due under this loan and the penalties. The court proceedings commenced on September 16, 2020 and we have until October 28, 2020 to submit our statement of defense. On March 24, 2020, the Company entered into a securities purchase agreement with Ultramar Energy Ltd., an accredited foreign investor, pursuant to which the Company expected to receive gross proceeds of $3.0 million, before deducting transaction costs, fees and expenses. On April 7, 2020 the Company entered into a Settlement Agreement with Unisun to resolve and settle these claims. The Company intended to use a portion of the net proceeds from Ultramar Energy to repay this loan to Unisun in the amount of $2.0 million to resolve and settle the claim. However, as of the date of this filing, the proceeds have not been received from Ultramar Energy Ltd. and there is no guarantee that the Company will ever receive the proceeds; therefore the Settlement Agreement has been terminated. There is no other action, suit, proceeding, inquiry or investigation before or by any court, public board, government agency, self-regulatory organization or body pending or, litigation claim to the knowledge of the executive officers of the Company or any of its subsidiaries, threatened against or affecting the Company, our common stock, any of our subsidiaries or of our companies or our subsidiaries’ officers or directors in their capacities as such, in which an adverse decision could have a material adverse effect. Operating Leases On March 6, 2019, the Company signed a lease for office space located in Dublin, Ireland, having a term of ten years, with a break option at the end of year five. The estimated payments is $55,038 per annum, to be paid quarterly. Also the Company paid a six month security deposit in the sum of $36,820. As part of the Rilland acquisition, the company acquired a twenty-five year lease. The annual lease payment is $139,923 for the first fifteen years and $55,969 for years sixteen through twenty five. The Company’s Romanian operations lease the land for the solar park. The combined estimated annual cost of $16,331 for 2020 and $16,283 thereafter. The leases commenced in 2012 and run for 20 years. Total Lease Expense 2020 $ 211,291 2021 211,243 2022 211,243 2023 211,243 2024 211,243 Thereafter 2,309,328 $ 3,365,591 |
Shareholders Equity
Shareholders Equity | 12 Months Ended |
Dec. 31, 2019 | |
Shareholders Equity | |
Note 9 - Shareholder's Equity | Common Stock Issuances: For the year ended December 31, 2019, 5,855,000 shares of common stock were issued to consultants for services rendered, 600,876 shares were issued as fees related to third party investment and 16,000,000 shares were issued to officers and directors for continued services and performance. The total value was based on the closing stock price of our common stock on the various dates of issuance, and equal to $1,513,214. During the twelve months ended December 31, 2018, the Company issued a total of 9,250,000 shares of restricted Class A common stock in exchange for services rendered. The value was based on the stock price of the various dates of issuance equal to $516,500. Common to Common Class B Stock Exchange On October 9, 2019 a Stock Exchange Agreement was entered into by and among Company and VestCo Corp. (“VestCo”), a company owned and controlled by Vincent Browne, our Chairman and CEO, whereby VestCo returned 15,000,000 shares of ALTN common stock, which were cancelled and returned to the total authorized but unissued shares of Class A common stock of the Company, in exchange for 15,000,000 shares of Class B Common Stock of the Company. The rights of the holders of Class A Common Stock and Class B Common Stock shall be identical other than voting rights; the holder of each share of Class B Common Stock shall be entitled to five votes for each such share ( see note 12-subsequent events) Preferred Stock Issuance: On August 19, 2019 a Stock Exchange Agreement was entered into by and among Alternus Energy Inc. (the “Company”) and its majority shareholder, Growthcap Investments Inc. (“GII”) whereby GII returned 50,000,000 shares of ALTN Class A common stock, which were cancelled and returned to the total authorized but unissued shares of common stock of the Company, in exchange for 5,000,000 shares of Series E Convertible Preferred Stock of the Company. The shareholder has the right to convert at his discretion. The Series E Convertible Preferred, with respect to dividends, rank pari passu with the Common Stock, and with respect to distributions upon liquidation, dissolution or winding up of the Company, rank senior to the Common Stock and junior to any other series of Preferred Stock. The fair value attributed to the liquidation preference was not deemed material and was limited to the stated value of the preferred stock. Preferred Stock Conversion: On November 27, 2018 the 30,000,000 shares of Series D Convertible Preferred Stock held by Power Clouds Holdings Pte. Ltd. automatically converted into 30,000,000 shares of restricted Class A common stock due to the increase in total authorized common shares to 450,000,000. Stock Incentive Plan: In June, 2019, the Board of Directors approved the Company’s 2019 Stock Incentive Plan (the “2019 Plan”). The 2019 Plan provides for the grant of incentive stock options, nonstatutory stock options, stock appreciation rights, stock grants, and stock units (collectively, the “Awards”). Awards may be granted under the 2019 Plan to our employees, directors and consultants (collectively, the “Participants”). The maximum number of shares of common stock available for issuance under the 2019 Plan is 22,500,000 shares. The shares of common stock subject to stock awards granted under the 2019 Plan that expire, are forfeited because of a failure to vest, or otherwise terminate without being exercised in full will return to the 2019 Plan and be available for issuance under the 2019 Plan. As of December 31, 2019 no awards have been granted. Warrants: As of December 31, 2019, warrants to purchase up to 13,053,235 shares of restricted Class A common stock were issued and outstanding. For the year end December 31, 2019, the Company issued 1,257,022 warrants exercisable at $0.25 per share and having a 4 year term from the date of issuance. The Company also issued 150,000 warrants exercisable at $.30 per share having a 3 year term from the date of issuance. These warrants related to financing activities and were recorded as a debt discount using the relative fair value method. We valued the debt discount using the Black Shoals method. We calculated the stock price as of the data of revaluation, with a remaining term of the warrants of 3 and 4 years. The volatility was calculated at 3.2 using the historical stock price and share volume of the company. We used 1.9% as the risk free rate, based on the Treasure rates for the similar period. During December 31, 2018, warrants to purchase up to 11,646,213 shares of restricted common stock were issued and outstanding. The Company issued 1,687,500 warrants exercisable at $0.20 per share and having a 5 year term from the date of issuance, which was related to a short term bridge facility and was recorded as a debt discount in the current year. The Company also issued 4,659,328 warrants exercisable at $.122 and having a 3 year term from the date of issuance, which was related to a short term loan facility and was recorded as a debt discount in the current year The Company also issued 5,299,385 warrants exercisable at a floor of $.122 and having a 3 year term from the date of issuance, which was related to two year loan facility. The value of the warrant is based on 80% of the last 10 days trading six months after the warrants were issued, which as of December 31, 2018 was unknow and therefor created the warrant liability. For these warrants, the Company recorded a derivative liability and debt discount of $338,861. In 2018, the Company recorded amortization expense totaling $707,603 related to the aforementioned warrants. December 31, 2019 December 31, 2018 Weighted Average Weighted Average Warrants Exercise Price Warrants Exercise Price Balance - beginning of the year 12,286,213 $ 0.13 1,240,000 $ 0.20 Expired during the year (640,000 ) 0.20 (600,000 ) $ .20 Granted during the year 1,407,022 0.26 11,646,213 0.13 Balance - end of year 13,053,235 $ 0.15 12,286,213 $ 0.13 Exercisable - end of year 13,053,235 $ 0.15 12,286,213 $ 0.13 |
Related Party Transactions
Related Party Transactions | 12 Months Ended |
Dec. 31, 2019 | |
Related Party Transactions | |
Note 10 - Related Party Transactions | In October of 2018, the Company entered into a settlement agreement with the CTO and Telenergia Europe S.r.l., (TES) a company controlled by the CTO the Company agreed to pay $100,000 to TES in settlement of all amounts due and owed to the CTO and TES and the gain on the settlement was not material. John Thomas, a Director of the Company, is also the owner and managing director of a merchant bank offering advisory services. The Company contracted with the related party in June of 2017 to provide certain consulting services to the Company. The related party was paid $50,000 and $10,000 for the years ended 2019 and 2018 respectively. As of June 28, 2019, this agreement was terminated. |
Geographical Information
Geographical Information | 12 Months Ended |
Dec. 31, 2019 | |
Geographical Information | |
Note 11- Geographical Information | The Company has one operating segment and the decision-making group is the senior executive management team. The Company manages the segment by country focusing on gross profit by country. Revenues 2019 2018 Italy $ 1,533,298 $ 829,794 Romania 932,382 1,763,170 Germany 106,734 - Netherlands 13,154 - Total $ 2,585,568 $ 2,592,964 Cost of Revenues Italy $ 206,149 $ 132,776 Romania 490,001 1,145,838 Germany 41,947 - Netherlands - - Total $ 738,097 $ 1,278,614 Gross Profit Italy $ 1,327,149 $ 697,018 Romania 442,381 617,332 Germany 64,787 - Netherlands 13,154 - Total $ 1,847,471 $ 1,314,350 December 31, Investment In Energy Property and Equipment, Net 2019 2018 Romania $ 4,772,109 $ 5,272,802 Italy 17,067,553 8,048,477 Germany 1,661,516 - Netherlands 9,958,300 1,418,488 $ 33,459,478 $ 14,739,767 |
Subsequent Events
Subsequent Events | 12 Months Ended |
Dec. 31, 2019 | |
Subsequent Events | |
Note 12 - Subsequent Events | In accordance with ASC 855, Subsequent Events, we have evaluated subsequent events through the date of issuance of these financial statements. In January 2020, the Company entered into a Securities Purchase Agreement with another accredited investor (the “Lender”), in connection with an investment of $250,000, and pursuant to which the Company issued a convertible promissory note accruing 12% interest per annum with bi-annual interest payments, having a two year term, senior in priority to all obligations of the Company other than the Company’s obligations to an accredited investor and its affiliated investment funds, or a similar replacement thereto, having a call option right for the noteholder, a redemption right for the Corporation, and convertible at $0.20 per share. In January of 2020, ALTN HoldCo UG entered into a construction financing loan of $3.9 million with MVB Bank in Germany. This relates to the construction of 6 photovoltaic installations in Germany with an interest rate of 6.5% and a term of one year. In February of 2020, the Corporation entered into a Securities Purchase Agreement with another accredited investor (the “Lender”), in connection with an investment of $105,000, and pursuant to which the Company issued a promissory note convertible at 65% of the lowest trading price of the Company’s Class A Common Stock for the last 15 trading days prior to conversion, and accruing 10% interest per annum, with a maturity date of February 10, 2021. In the first quarter of 2020, the Corporation issued 135,368 shares of Class A common stock as fees related to third party investment, and 33,250 shares of restricted Class A common stock were issued to a consultant for services rendered. The total value was based on the closing stock price of our common stock on the various dates of issuance, and equal to $29,150. On March 20, 2020, the Company received a notice of conversion from Growthcap Investments Inc. (“GII”) to convert the entirety of its shares of Series E Convertible Preferred Stock, with a stated value of $0.001 per share, into an aggregate of 50,000,000 shares of the Company’s Class A Common Stock (the “Conversion”). On March 20, 2020, the Company effected the Conversion and issued to GII an aggregate of 50,000,000 shares of Class A Common Stock. On March 24, 2020 the Company and Ultramar Energy Ltd., a foreign institutional accredited investor (the “Investor”), entered into a $3.0 million securities purchase agreement (the “Securities Purchase Agreement”) pursuant to which the Company will sell and issue to the Investor an aggregate of 30,000,000 shares of the Company’s Class A Common Stock, par value $0.001 per share, at a price of $0.10 per share (the “Private Placement”). Pursuant to the Securities Purchase Agreement, the Company will also issue to the Investor a one-year warrant (“Class A Warrant”) to purchase up to 12,000,000 shares of the Class A Common Stock. Class A Warrant will have an exercise price equal to $0.125, subject to the additional terms of Class A Warrant. As of the date of the filing of this report, the Company has not received the proceeds from the $3.0 million Private Placement. The Company extended the closing of this Private Placement to April 30, 2020. As of the date of issuance of this report, the Company does not expect that it will ever receive these funds. On April 7, 2020 the Company entered into a Settlement Agreement with Unisun whereby the Company agreed to pay Unisun $2,000,000 as full settlement for all the outstanding amounts owed under the loan from Unisun and related to the acquisition of Zonnepark Rilland, other than the potential earn out as described in Note 4. As of the date of the filing of this report, the Company has not made the $2,000,000 payment to Unisun, due to the non-receipt of the proceeds from the $3.0 million Private Placement described above and the Settlement Agreement has therefore been terminated. As a result, Unisun started court proceedings to claim the amounts due under its loan and related penalties. The court proceedings commenced on September 16, 2020 and we have until October 28, 2020 to submit our statement of defense. On May 22, 2020, the Corporation issued 700,000 shares of Class A common stock to two consultants for services rendered. The total value was based on the closing stock price of our common stock on the various dates of issuance, and equals $77,000. On June 12, 2020, Alternus Energy International Limited (“Alternus” or the “Purchaser”), a wholly owned subsidiary of the Company, and Sycamore Capital (Italy) Limited (the “Seller”) entered into a Share Purchase Agreement (the “SPA”). Pursuant to the terms of the SPA, the Seller agreed to sell to Alternus 100% of the share capital of Solar Sicily S.r.l., an Italian SPV that owns and is acquiring the project rights to develop and construct a 102 MW ground-mounted solar photovoltaic (PV) power plant in Sicily, Italy (the “Project”), in exchange for approximately $15.4 million (€14 million), to be paid on closing (the “Purchase Price”). In July, the Company incorporated 3 new wholly owned subsidiaries, one in the Netherlands, AEN 02 B.V, and two in Italy, PC-Italia-04 Srl, which is wholly owned by AEN 02 BV, and PC-Italia-03 Srl, which is wholly owned by Alternus Energy International Ltd. These companies were incorporated to acquire various special purpose vehicles (SPVs), project rights and other solar energy assets in various locations across Europe. On August 12, 2020, the Company issued an option to purchase up to 100,000 shares of restricted common stock under the Corporation’s 2019 Stock Incentive Plan, having a three year vesting schedule and exercisable at $0.10 per share with a cashless exercise provision. On August 12, 2020, the Company guaranteed a 9.15 million RON (equivalent to approximately US$2.0M) promissory note issued by both of its subsidiaries, Power Clouds S.R.L., and F.R.A.N. Energy Investment SRL two Romanian companies to OTP Bank in Romania, which is secured in first position against the Romanian solar parks and customer contracts held, accruing interest annually at a rate of ROBOR 3M + 3.3% and having a term of 10 years. The recent outbreak of the corona virus, also known as “COVID-19”, has spread across the globe and is impacting worldwide economic activity. Conditions surrounding the corona virus continue to rapidly evolve and government authorities have implemented emergency measures to mitigate the spread of the virus. The outbreak and the related mitigation measures may have an adverse impact on global economic conditions as well as on the Company’s business activities. The extent to which the corona virus may impact the Company’s business activities will depend on future developments, such as the ultimate geographic spread of the disease, the duration of the outbreak, travel restrictions, business disruptions, and the effectiveness of actions taken in the United States and other countries to contain and treat the disease. These events are highly uncertain and as such, the Company cannot determine their financial impact at this time |
Summary of Significant Accoun_2
Summary of Significant Accounting Policies (Policies) | 12 Months Ended |
Dec. 31, 2019 | |
Summary of Significant Accounting Policies | |
Basic of Presentation | The consolidated financial statements include the consolidated balance sheet, statements of operations and comprehensive loss, changes in shareholders’ equity and cash flows of the Company and have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) from records maintained by the Company. |
Basis of consolidation | The consolidated financial statements as of December 31, 2019 and December 31, 2018 and for the years then ended include the accounts of the Company and the aforementioned subsidiaries. All intercompany accounts and transactions have been eliminated in consolidation. The results of subsidiaries acquired or disposed of during the respective periods are included in the consolidated financial statements from the effective date of acquisition or up to the effective date of disposal, as appropriate. |
Use of estimates | The preparation of consolidated financial statements in conformity with GAAP. requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the consolidated financial statements and reported amounts of revenues and expenses for the periods presented. The most significant estimates with regard to these statements relate to the assumptions utilized in the valuation of the assets acquired, calculation of stock and warrant compensation expense, asset retirement obligations and impairment of long-lived assets. Actual results could differ from these estimates. |
Cash and Cash Equivalents | The Company considers cash, demand deposits and highly liquid investments with maturities of less than three months when purchased to be cash and cash equivalents. The Company maintains cash and cash equivalents with major financial institutions, which may at times exceed federally insured limits. The Company periodically assesses the financial condition of the institutions and believes the risk of loss to be remote. |
Accounts Receivable | Accounts receivable are uncollateralized customer obligations due under normal trade terms requiring payment within that period. Accounts receivable are stated at the amount management expects to collect from balances outstanding at year-end. Management establishes an allowance for doubtful customer accounts through a review of historical losses, specific customer balances, and industry economic conditions. Customer accounts are charged off against the allowance for doubtful accounts when management determines that the likelihood of eventual collection is remote. The Company extends credit based on an evaluation of customers’ financial conditions and determines any additional collateral requirements. Exposure to losses on receivables is principally dependent on each customer’s financial condition. The Company considers invoices past due when they are outstanding longer than the stated term. Additionally, the Company monitors its exposure for credit losses and maintains allowances for anticipated losses. At December 31, 2019 and 2018, management determined that an allowance for doubtful accounts was not material. |
Energy Property and Equipment | Acquired energy property and equipment is recognized at fair value at the date of acquisition, less depreciation. Energy property constructed by the Company is recognized at its cost, less depreciation. The Company provides for depreciation utilizing the straight-line method by charges to operations over the estimated useful lives of the solar energy facilities, which is twenty years. Expenditures during the construction of new solar energy facilities are capitalized to development in progress as incurred until achievement of the commercial operation date (COD). Expenditures for maintenance and repairs are charged to expense as incurred. Upon retirement, sale or other disposition of equipment, the cost and accumulated depreciation are removed from the accounts and the related gain or loss, if any, is reflected in the year of disposal. When the Company abandons the anticipated construction of a new solar energy facility during the development phase, costs previously capitalized to development in progress are written off. |
Goodwill and Indefinite-Lived Intangible Assets | The Company has goodwill and certain indefinite-lived intangible assets that have been recorded in connection with the acquisition of a business. Goodwill and indefinite-lived assets are not amortized, but instead are tested for impairment at least annually. Goodwill represents the excess of the purchase price of an acquired business over the estimated fair value of the underlying net tangible and intangible assets acquired. For purposes of the goodwill impairment test, the Company has determined that it currently operates as a single reporting unit. If it is determined that an impairment has occurred, the Company adjusts the carrying value accordingly, and charges the impairment as an operating expense in the period the determination is made. Although the Company believes goodwill is appropriately stated in the consolidated financial statements, changes in strategy or market conditions could significantly impact these judgments and require an adjustment to the recorded balance. |
Intangible Assets | Intangible assets consist of long-term operating contracts acquired through the acquisition of solar energy facilities. Intangible assets are initially recognized at their fair value and are amortized over the term of the related Power Purchase Agreement (PPAs) using the straight-line method. For solar energy facilities that are purchased and then put into construction, intangible assets are recorded at cost, and are amortized over the term of the related PPAs using the straight-line method. |
Impairment of Long-Lived Assets | The Company reviews its investment in energy property and PPAs for impairment whenever events or changes in circumstances indicate that the carrying value of an asset may not be recoverable. When evaluating impairment, if the undiscounted cash flows estimated to be generated by the energy property are less than its carrying amount, the differential carrying amount is determined to be not recoverable. The amount of the impairment loss is equal to the excess of the asset’s carrying value over its estimated fair value. |
Asset Retirement Obligation | In connection with the acquisition or development of solar energy facilities, the Company may have the legal requirement to remove long-lived assets constructed on leased property and to restore the leased property to its condition prior to the construction of the long-lived assets. This legal requirement is referred to as an asset retirement obligation (ARO). If the Company determines that an ARO is required for a specific solar energy facility, the Company records the present value of the estimated future liability when the solar energy facility is placed in service. AROs recorded for owned facilities are recorded by increasing the carrying value of investment in energy property and depreciated over the solar energy facility’s useful life, while an ARO recorded for a leasing arrangement is accounted for as a liability in the initial period recognized and amortized over the term of the solar energy facility’s useful life. After initial recognition of the liability, the Company accretes the ARO to its future value over the solar energy facility’s useful life. As of December 31, 2019 and 2018, the Company’s asset retirement obligations were not material. |
Revenue Recognition | In May 2014, the Financial Accounting Standards Board (“FASB”) issued ASU No. 2014-09, Revenue from Contracts with Customers (Topic 606) The Company derives revenues through its subsidiaries from the sale of electricity and the sale of solar renewable energy credits. Energy generation revenue and solar renewable energy credits revenue are recognized as electricity is generated by the solar energy facility and delivered to the grid at which time all performance obligations have been delivered. Revenues are based on actual output and contractual sale prices set forth in long-term contracts. Disaggregated Revenues The following table shows the Company’s revenues disaggregated by pricing plans offered to customers: Net Revenue, by Offtake Type 2019 2018 Feed in Tariff $ 1,653,186 $ 829,794 Green Certificates 631,740 789,740 Energy Offtake Agreements 300,642 973,430 Total $ 2,585,568 $ 2,592,964 During the year ended December 31, 2019, two customers represented 56% and 30% of revenues and 37% and 9% of accounts receivable balance. During the year ended December 31, 2018, one of same customer and one different customer represented 32% and 21% of revenues. |
Unbilled Energy Incentives Earned | The Company derives revenues from the sale of green certificates for the Romania projects. The green certificates revenues are recognized in the month they are generated by the solar project and registered with the local authority. The Company considers them unbilled at the end of the period if they have not been invoiced to a third party customer. |
Taxes Recoverable | The Company records taxes recoverable, when there has been an overpayment of taxes due to timing of the Value Added Tax (VAT) between vendors and customers. The VAT tax can also be offset against a Country’s income taxes where the VAT was registered. |
Risks and Uncertainties | The Company’s operations are subject to significant risk and uncertainties including financial, operational, technological, and regulatory risks including the potential risk of business failure. Also see Note 2 regarding going concern matters. |
Fair Value of Financial Instruments | The Company measures its financial instruments at fair value under GAAP establishes a framework for measuring fair value and disclosures about fair value measurements. To increase consistency and comparability in fair value measurements and related disclosures, GAAP establishes a fair value hierarchy that prioritizes the inputs to valuation techniques used to measure fair value into three (3) broad levels. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. The three (3) levels of fair value hierarchy are described below: Level 1 Quoted market prices available in active markets for identical assets or liabilities as of the reporting date. Level 2 Pricing inputs other than quoted prices in active markets included in Level 1 that are either directly or indirectly observable as of the reporting date. Level 3 Pricing inputs that are generally observable inputs and not corroborated by market data. Financial assets are considered Level 3 when their fair values are determined using pricing models, discounted cash flow methodologies or similar techniques and at least one significant model assumption or input is unobservable. The Company has level 3 assets and liabilities consisting of asset retirement obligations and warrant liabilities. The asset retirement obligations are not material. As of April 15, 2019 the exercise price of the warrants previously issued in conjunction with the Inmost note became fixed at a price of $0.122 and the derivative liability of $471,837 was reclassified to equity. During the year ended December 31, 2019, the Company recorded a change in fair value of $132,976. December 31, 2019 December 31, 2018 Balance - beginning of the year 338,861 -- Derivative liability 338,861 Change in fair value of derivative liability 132,976 - Reclassification of derivative liability (471,837 ) - Balance - end of year - 338,861 We valued the derivative using the Black Scholes method. We calculated the stock price as of the data of revaluation, with a remaining term of the warrants of 2.5 years. The volatility was calculated at 3.3 using the historical stock price and share volume of the company. We used 2.94% as the risk free rate, based on the Treasury rates for the similar period. The warrants were valued using the floor price of $0.122 with a valuation date of April 15, 2019. The fair value hierarchy gives the highest priority to quoted prices (unadjusted) in active markets for identical assets or liabilities and the lowest priority to unobservable inputs. If the inputs used to measure the financial assets and liabilities fall within more than one level described above, the categorization is based on the lowest level input that is significant to the fair value measurement of the instrument. The carrying amount of the Company’s financial assets and liabilities, such as cash, accounts payable, approximate their fair value because of the short maturity of those instruments. |
Income Taxes | Deferred taxes are provided on a liability method whereby deferred tax assets are recognized for deductible temporary differences, operating loss and tax credit carry forwards and deferred tax liabilities are recognized for taxable temporary differences. Temporary differences are the differences between the reported amounts of assets and liabilities and their tax basis. Valuation allowances are established when necessary to reduce deferred tax assets to the amount expected to be realized. Deferred tax assets and liabilities are adjusted for the effects of changes in tax laws and rates on the date of enactment. As of December 31, 2019 and 2018, the Company has U.S. federal and state net operating loss carryovers of approximately $4,667,136 and $1,727,412 respectively, which will expire at various dates beginning in 2034 through 2037, if not utilized with exception of loss carryovers generated in 2018 and 2019. As a result of Tax Cuts and Jobs Act, net operating losses generated in 2018 and beyond have indefinite lives, but limited to 80% of taxable income in each year. Additionally, as of December 31, 2019 and 2018, the Company has U.S. federal capital loss carryovers of approximately $949,875 and $949,875 respectively, which will expire at various dates beginning in 2020 through 2022, if not utilized against capital gain income. In accordance with Section 382 of the internal revenue code, deductibility of the Company’s U.S. net operating loss carryovers may be subject to an annual limitation in the event of a change of control as defined under the Section 382 regulations. Quarterly ownership changes for the past 3 years were analyzed and it was determined that there was no change of control as of December 31, 2019. In assessing the realization of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities, projected future taxable income and tax planning strategies in making this assessment. After consideration of all of the information available, management believes that significant uncertainty exists with respect to future realization of the deferred tax assets and has therefore established a full valuation allowance. For the years ended December 31, 2019 and 2018, the change in valuation allowance was $926,792 and $960,552, respectively. As of December 31, 2019 and 2018, the valuation allowance was $1,887,344 and $960,552, respectively. The Company evaluated the provisions of ASC 740 related to the accounting for uncertainty in income taxes recognized in their financial statements. ASC 740 prescribes a comprehensive model for how a company should recognize, present, and disclose uncertain positions that the company has taken or expects to take in its return. For those benefits to be recognized, a tax position must be more-likely-than- not to be sustained upon examination by taxing authorities. Differences between two positions taken or expected to be taken in a tax return and the benefit recognized and measured pursuant to the interpretation are referred to as “unrecognized benefits”. A liability is recognized for an unrecognized tax benefit because it represents an enterprise’s potential future obligation to the taxing-authority for a tax position that was not recognized as a result of applying the provisions of ASC 740. Penalties and interest assessed by income tax authorities would be included in income tax expense. For the period ended December 31, 2019 and 2018, the Company did not incur any penalties or interest. As of December 31, 2018, the Company accrued $180,000 related to noncompliance of administrative filing for their foreign entities for the periods 2012 – 2017. |
Stock-Based Compensation | The Company accounts for stock-based compensation in accordance with ASC 718. Under the fair value recognition provisions of this statement, stock-based compensation cost is measured at the grant date based on the fair value of the award and is recognized as expense on a straight-line basis over the requisite service period, which is the vesting period. |
Net loss per common share | Net loss per common share is computed pursuant to section 260 of the FASB Accounting Standards Codification. Basic net loss per common share is computed by dividing net loss by the weighted average number of shares of common stock outstanding during the period. Diluted net loss per common share is computed by dividing net loss by the weighted average number of shares of common stock and potentially outstanding shares of common stock during the period to reflect the potential dilution that could occur from common shares issuable through contingent shares issuance arrangement, stock options or warrants. As of December 31, 2019, the Company had 5,000,000 shares of Series E Convertible Preferred Stock which convert into 50,000,000 shares of common stock, 13,053,235 of warrants, and 8,828,233 of convertible shares associated with debt issuance for a total of 71,881,468 shares of Class A common stock. As of December 31, 2018, the Company had 12,286,213 of warrants, and 4,360,105 of convertible shares associated with debt issuance for a total of 16,646,318 shares of Class A common stock. These shares were not included because they were anti-dilutive. |
Foreign Currency and Other Comprehensive Loss | The functional currency of our foreign subsidiaries is typically the applicable local currency which is Romania Lei, Japanese Yen or European Union Euros. The translation from the respective foreign currency to United States Dollars (U.S. Dollar) is performed for balance sheet accounts using current exchange rates in effect at the balance sheet date and for income statement accounts using an average exchange rate during the period. Gains or losses resulting from such translation are included as a separate component of accumulated other comprehensive income. Gains or losses resulting from foreign currency transactions are included in foreign currency income or loss except for the effect of exchange rates on long-term inter-company transactions considered to be a long-term investment, which are accumulated and credited or charged to other comprehensive income. Transaction gains and losses are recognized in our results of operations based on the difference between the foreign exchange rates on the transaction date and on the reporting date. The Company had a immaterial net foreign exchange loss for the period ended December 31, 2019 and 2018, respectively. The foreign currency exchange gains and losses are included as a component of general and administrative expenses in the accompanying Consolidated Statements of Operations and Comprehensive (Loss). For the period ended December 31, 2019 and 2018, the increase (decrease) in accumulated comprehensive gain (loss) was ($382,190) and ($466,299), respectively. |
Preferred Stock | We apply the accounting standards for distinguishing liabilities from equity under U.S. GAAP when determining the classification and measurement of our convertible preferred stock. Preferred Stock subject to mandatory redemption is classified as liability instruments and is measured at fair value. Conditionally redeemable Preferred Stock (including preferred stock that features redemption rights that are either within the control of the holder or subject to redemption upon the occurrence of uncertain events not solely within our control) is classified as temporary equity. At all other times, preferred stock is classified as permanent equity. As of December 31, 2019, the Company had 5,000,000 shares of Series E Convertible Preferred Stock issued and outstanding which convert into 50,000,000 shares of common stock. The Series E Convertible Preferred, with respect to dividends, rank pari passu with the Common Stock, and with respect to distributions upon liquidation, dissolution or winding up of the Company, rank senior to the Common Stock and junior to any other series of Preferred Stock. |
Subsequent Events | The Company follows the guidance in Section 855 of the FASB Accounting Standards Codification for the disclosure of subsequent events. The Company will evaluate subsequent events through the date when the financial statements were issued. Pursuant to ASU 2010-09 of the FASB Accounting Standards Codification, the Company considers its financial statements issued when they are widely distributed to users, such as through filing them with OTC Markets. No subsequent events required disclosure except for those in Note 11. |
Recent Accounting Standards Adopted | On January 1, 2019, the Company adopted ASU 2016-18. The adoption had an impact on the Company’s beginning of the period and end of the period cash and cash equivalents balance in its statement of cash flows. Restricted cash at the end of December 31, 2019 was related to debt service reserve and maintenance reserves required by third party senior lender. The restricted cash at the end of December 31, 2108 related to future acquisition of Italian parks that was completed in 2019. The following table provides a reconciliation of cash, cash equivalents, and restricted cash reported in the consolidated balance sheet that equals the total of the same amounts reported in the consolidated statement of cash flows: December 31, 2019 December 31, 2018 Cash and cash equivalents $ 1,076,995 $ 1,026,533 Restricted cash 349,434 8,857,966 Total cash, cash equivalents, and restricted cash $ 1,426,429 $ 9,884,499 In June 2018, the FASB issued ASU No. 2018-07, Compensation – Stock Compensation (Topic 718): Improvements to Nonemployee Share-Based Payment Accounting st |
Recent Accounting Standards Not Adopted | In February 2016, the FASB issued ASU 2016-02, Leases (Topic 842), to increase transparency and comparability among organizations by recognizing a right-of-use asset and a lease liability on the balance sheet for all leases with terms longer than 12 months. Leases will be classified as either operating or financing, with such classifications affecting the pattern of expense recognition in the income statement. ASU 2016-02 is effective for fiscal years beginning after December 15, 2019, and early adoption is permitted. ASU 2016-02 was recently delayed for emerging growth companies that elected to adopt new accounting standards on the adoption date required for private companies and will be effective for the Company’s annual reporting period in 2022 and interim periods beginning first quarter of 2023. The Company is evaluating the impact ASU 2016-02 will have on its financial statements and associated disclosures. In June 2016, the FASB issued ASU No. 2016-13, Financial Instruments-Credit losses (Topic 326). This new guidance will change how entities account for credit impairment for trade and other receivables, as well as for certain financial assets and other instruments. The update will replace the current incurred loss model with an expected loss model. Under the incurred loss model, a loss (or allowance) is recognized only when an event has occurred (such as a payment delinquency) that causes the entity to believe that a loss is probable (that is has been “incurred”). Under the expected loss model, a loss (or allowance) is recognized upon initial recognitions of the asset that reflects all future events that leads to a loss being realized, regardless of whether it is probable that the future event will occur. The incurred loss model considers past events and conditions, while the expected loss model includes expectations for the future which have yet to occur. ASU 2018-19 was issued in November 2018 and excludes operating leases from the new guidance. The standard will require entities to record a cumulative-effect adjustment to the balance sheet as of the beginning of the first reporting period in which the guidance is effective. As an Emerging Growth Company, the standard is effective for the Company’s 2022 annual reporting period and interim periods beginning first quarter of 2023. The Company is evaluating the impact of ASU 2016-13 will have on its financial statements and associated disclosures. On December 18, 2019, the FASB issued Accounting Standards Update 2019-12, Income Taxes (Topic 740): Simplifying the Accounting for Income Taxes (the ASU), as part as part of its overall simplification initiative to reduce costs and complexity of applying accounting standards while maintaining or improving the usefulness of the information provided to users of financial statements. The FASB’s amendments primarily impact ASC 740, Income Taxes, and may impact both interim and annual reporting periods. The Company is currently evaluating the effect that the adoption of ASU 2019-12 will have on its consolidated financial statement. The guidance is effective January 1, 2021 with early adoption permitted. |
Organization and Formation (Tab
Organization and Formation (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Organization and Formation | |
Schedule of Organization and Formation | Subsidiary Principal Activity Date Acquired / Established ALTN Ownership Country of Operation Power Clouds SRL SPV March 31, 2015 99.5%* Romania F.R.A.N. Energy Investment SRL SPV March 31, 2015 99.5%* Romania AE Europe B.V. Holding Company August 2016 100% Netherlands PC-Italia-01 S.R.L. Sub-Holding June 2015 100% (via PCE) Italy PC-Italia-02 S.p.A. SPV August 2016 100% (via PCE) Italy Sant’Angelo Energia S.r.l. SPV March 30, 2017 100% (via PC_Italia_02) Italy PCG_HoldCo GmbH Holding Company July 6, 2018 100% Germany PCG_GP UG General Partner (Management Company) August 30, 2018 100% Germany PSM 20 UG SPV November 14, 2018 100% (via PCG_HoldCo) Germany PSM 40 UG SPV December 28, 2018 100% (via PCG_HoldCo) Germany GRK 17.2 GmbH & Co KG SPV November 17, 2018 100% (via PCG_HoldCo) Germany GRT 1.1 GmbH & Co KG SPV December 21, 2018 100% (via PCG_HoldCo) Germany ALTN HoldCo UG SPV December 14, 2018 100% (via PCG HoldCo) Germany Alternus Energy International Ltd. European Operational Centre March 1, 2019 100% Ireland CIC Rooftop 2 S.r.l. SPV April 23, 2019 100% (via PC-Italia-02) Italy CIC RT Treviso S.r.l. SPV April 23, 2019 100% (via PC-Italia-02) Italy SPV White One S.r.l. SPV April 23, 2019 100% (via PC-Italia-02) Italy CTS Power 2 S.r.l. SPV April 23, 2019 100% (via PC-Italia-02) Italy AEN 01 B.V. SPV June 13, 2019 100% Netherlands Zonnepark Rilland B.V. SPV December 20, 2019 100% Netherlands |
Summary of Significant Accoun_3
Summary of Significant Accounting Policies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Summary of Significant Accounting Policies | |
Schedule of Revenue Recognition | Net Revenue, by Offtake Type 2019 2018 Feed in Tariff $ 1,653,186 $ 829,794 Green Certificates 631,740 789,740 Energy Offtake Agreements 300,642 973,430 Total $ 2,585,568 $ 2,592,964 |
Schedule of Fair Value of Financial Instruments | December 31, 2019 December 31, 2018 Balance - beginning of the year 338,861 -- Derivative liability 338,861 Change in fair value of derivative liability 132,976 - Reclassification of derivative liability (471,837 ) - Balance - end of year - 338,861 |
Schedule of Recent Accounting Standards Adopted | December 31, 2019 December 31, 2018 Cash and cash equivalents $ 1,076,995 $ 1,026,533 Restricted cash 349,434 8,857,966 Total cash, cash equivalents, and restricted cash $ 1,426,429 $ 9,884,499 |
Acquisitions and dispositions (
Acquisitions and dispositions (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Acquisitions and dispositions | |
Schedule of Acquisitions | Cost of Acquisition Acquisition price $ 11,651,997 Net working capital acquired 419,011 Total Acquisition Cost 12,071,008 Fair Value of Assets Acquired Present value of the future cash flows 9,853,884 Net working capital acquired 419,011 10,272,895 Goodwill $ 1,798,113 |
Schedule of commitment purchase | Total Cost of acquisitions Cash paid for assets $ 6,131,004 Total acquisition cost $ 6,131,004 Fair value of assets acquired Investment in energy property 9,939,414 Net working capital acquired 384,397 Asset retirement liability (65,114 ) $ 10,258,697 Gain on bargain purchase $ 4,127,693 |
Schedule of acquisition of long term | Acquisition Cost Cash paid for assets $ 4,177,206 Taxes paid at closing 131,394 Total acquisition cost 4,308,600 Fair value of assets acquired NPV of discounted cash flow 5,790,731 Net working capital acquired 148,685 Less asset retirement obligation (57,013 ) Net fair value of assets acquired $ 5,882,403 Gain on bargain purchase $ 1,573,803 |
Schedule of aggregate consideration received | Proceeds from sale $ 3,760,155 Net carrying cost of asset at time of sale (4,688,212 ) Net working capital adjustment 246,636 Loss on sale of asset and related operating companies $ (681,421 ) |
Schedule of proforma combined results | 2019 2018 Revenues, net $ 4,347,671 $ 4,011,556 Net (loss) $ (6,544,295 ) $ (3,208,498 )) Net (loss) per share $ (0.07 ) $ (0.04 ) Basic weighted average number of shares outstanding 97,969,579 71,600,361 |
Investment in Energy Property_2
Investment in Energy Property and Equipment (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Investment in Energy Property and Equipment, Net | |
Schedule of Investment in Energy Property and Equipment | December 31, 2019 December 31, 2018 Solar energy facilities operating $ 36,123,412 $ 16,278,252 Less accumulated depreciation and amortization (2,663,934 ) (1,538,485 ) Net Assets $ 33,459,478 $ 14,739,767 |
Schedule of capital leases | December 31, 2019 December 31, 2018 Capitalized costs relating to PV plants $ 2,311,255 $ 2,358,588 Less accumulated amortization (321,821 ) (208,989 ) Net Assets $ 1,989,434 $ 2,149,599 |
Capital Leases (Tables)
Capital Leases (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Capital Leases | |
Schedule of Capital Leases | 2020 140,009 2021 140,009 2022 140,009 2023 140,009 2024 140,009 Thereafter 606,704 1,306,749 Less Interest Expense (295,015 ) $ 1,011,734 |
Convertible and Unconvertible_2
Convertible and Unconvertible Promissory Notes (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Convertible and Unconvertible Promissory Notes | |
Schedule of Convertible and Nonconvertible Promissory Notes | December 31, 2019 December 31, 2018 Short term line of credit $ 35,120 $ 73,560 Promissory notes related parties 48,821 207,753 Convertible notes related parties 291,540 284,000 Senior secured debt 19,575,794 10,192,603 Promissory notes 15,478,536 13,278,803 Convertible promissory notes 2,169,401 1,097,289 Gross debt 37,599,212 25,134,007 Debt discount (784,130 ) (303,563 ) Net debt 36,815,082 24,830,444 Less current maturities (22,705,665 ) (14,510,204 ) Long Term Debt, net of current maturities $ 14,109,418 $ 10,320,240 2020 2021 2022 2023 2024 Thereafter Total Gross debt $ 23,129,751 $ 1,102,888 $ 1,108,229 $ 1,113,219 $ 1,118,312 $ 10,026,813 $ 37,599,212 Debt discount (424,084 ) (360,046 ) (784,130 ) Net debt $ 22,705,667 $ 742,842 $ 1,108,229 $ 1,113,219 $ 1,118,312 10,026,813 $ 36,815,082 |
Commitments and Contingencies (
Commitments and Contingencies (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Commitments and Contingencies | |
Schedule of Commitments and Contingencies | Total Lease Expense 2020 $ 211,291 2021 211,243 2022 211,243 2023 211,243 2024 211,243 Thereafter 2,309,328 $ 3,365,591 |
Shareholders Equity (Tables)
Shareholders Equity (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Shareholders Equity | |
Schedule of Shareholders' Equity | December 31, 2019 December 31, 2018 Weighted Average Weighted Average Warrants Exercise Price Warrants Exercise Price Balance - beginning of the year 12,286,213 $ 0.13 1,240,000 $ 0.20 Expired during the year (640,000 ) 0.20 (600,000 ) $ .20 Granted during the year 1,407,022 0.26 11,646,213 0.13 Balance - end of year 13,053,235 $ 0.15 12,286,213 $ 0.13 Exercisable - end of year 13,053,235 $ 0.15 12,286,213 $ 0.13 |
Geographical Information (Table
Geographical Information (Tables) | 12 Months Ended |
Dec. 31, 2019 | |
Geographical Information | |
Schedule of Geographical Information | Revenues 2019 2018 Italy $ 1,533,298 $ 829,794 Romania 932,382 1,763,170 Germany 106,734 - Netherlands 13,154 - Total $ 2,585,568 $ 2,592,964 Cost of Revenues Italy $ 206,149 $ 132,776 Romania 490,001 1,145,838 Germany 41,947 - Netherlands - - Total $ 738,097 $ 1,278,614 Gross Profit Italy $ 1,327,149 $ 697,018 Romania 442,381 617,332 Germany 64,787 - Netherlands 13,154 - Total $ 1,847,471 $ 1,314,350 December 31, Investment In Energy Property and Equipment, Net 2019 2018 Romania $ 4,772,109 $ 5,272,802 Italy 17,067,553 8,048,477 Germany 1,661,516 - Netherlands 9,958,300 1,418,488 $ 33,459,478 $ 14,739,767 |
Organization and Formation (Det
Organization and Formation (Details) | 12 Months Ended |
Dec. 31, 2019 | |
AE Europe BV [Member] | |
Principal Activity | Holding Company |
Date Acquired/Established | Aug. 1, 2016 |
ALTN Ownership | 100.00% |
County of Operation | Netherlands |
Zonnepark Rilland B.V. [Member] | |
Principal Activity | SPV |
Date Acquired/Established | Dec. 20, 2019 |
ALTN Ownership | 100.00% |
County of Operation | Netherlands |
AEN 01 B.V. [Member] | |
Principal Activity | SPV |
Date Acquired/Established | Jun. 13, 2019 |
ALTN Ownership | 100.00% |
County of Operation | Netherlands |
PSM 40 UG [Member] | |
Principal Activity | SPV |
ALTN Ownership | 100.00% |
County of Operation | Germany |
Date Acquired/Established | Dec. 28, 2018 |
CTS Power 2 S.r.l. [Member] | |
Principal Activity | SPV |
Date Acquired/Established | Apr. 23, 2019 |
ALTN Ownership | 100.00% |
County of Operation | Italy |
SPV White One S.r.l.[Member] | |
Principal Activity | SPV |
Date Acquired/Established | Apr. 23, 2019 |
ALTN Ownership | 100.00% |
County of Operation | Italy |
CIC RT Treviso S.r.l. [Member] | |
Principal Activity | SPV |
Date Acquired/Established | Apr. 23, 2019 |
ALTN Ownership | 100.00% |
County of Operation | Italy |
CIC Rooftop 2 S.r.l [Member] | |
Principal Activity | SPV |
Date Acquired/Established | Apr. 23, 2019 |
ALTN Ownership | 100.00% |
County of Operation | Italy |
Alternus Energy International Limited [Member] | |
Principal Activity | European Operational Centre |
Date Acquired/Established | Mar. 1, 2019 |
ALTN Ownership | 100.00% |
County of Operation | Ireland |
ALTN HoldCo UG [Member] | |
Principal Activity | SPV |
Date Acquired/Established | Dec. 14, 2018 |
ALTN Ownership | 100.00% |
County of Operation | Germany |
GRT 1.1 GmbH & Co KG [Member] | |
Principal Activity | SPV |
Date Acquired/Established | Dec. 21, 2018 |
ALTN Ownership | 100.00% |
County of Operation | Germany |
GRK 17.2 GmbH & Co KG [Member] | |
Principal Activity | SPV |
Date Acquired/Established | Nov. 17, 2018 |
ALTN Ownership | 100.00% |
County of Operation | Germany |
PSM 20 UG [Member] | |
Principal Activity | SPV |
Date Acquired/Established | Nov. 14, 2018 |
ALTN Ownership | 100.00% |
County of Operation | Germany |
PCG_GP UG [Member] | |
Principal Activity | General Partner (Management Company) |
Date Acquired/Established | Aug. 30, 2018 |
ALTN Ownership | 100.00% |
County of Operation | Germany |
PCG_HoldCo GmbH [Member] | |
Principal Activity | Holding Company |
ALTN Ownership | 100.00% |
County of Operation | Germany |
Date Acquired/Established | Jul. 6, 2018 |
Sant Angelo Energia SRL [Member] | |
Principal Activity | SPV |
Date Acquired/Established | Mar. 30, 2017 |
ALTN Ownership | 100.00% |
County of Operation | Italy |
PC-Italia-02 S.p.A. [Member] | |
Principal Activity | SPV |
ALTN Ownership | 100.00% |
County of Operation | Italy |
Date Acquired/Established | Aug. 1, 2016 |
PC-Italia-01 S.R.L. [Member] | |
Principal Activity | Sub-Holding |
Date Acquired/Established | Jun. 1, 2015 |
ALTN Ownership | 100.00% |
County of Operation | Italy |
F.R.A.N. Energy Investment SRL [Member] | |
Principal Activity | SPV |
Date Acquired/Established | Mar. 31, 2015 |
ALTN Ownership | 99.50% |
County of Operation | Romania |
Power Clouds SRL [Member] | |
Principal Activity | SPV |
Date Acquired/Established | Mar. 31, 2015 |
ALTN Ownership | 99.50% |
County of Operation | Romania |
Organization and Formation (D_2
Organization and Formation (Details Narrative) | 12 Months Ended |
Dec. 31, 2019 | |
Description of incorporation name changes | On September 11, 2008 the corporation changed its name from Asset Realization, Inc. to World Assurance Group, Inc. On April 24, 2015, the Company changed its name from World Assurance Group, Inc. to Power Clouds Inc. On November 29, 2018, the Company changed its name from Power Clouds Inc. to Alternus Energy Inc. and related stock ticker symbol change from PWCL to ALTN |
ALTN HoldCo UG [Member] | |
County of Operation | Germany |
ALTN Ownership | 100.00% |
Date Acquired/Established | Dec. 14, 2018 |
Principal Activity | SPV |
Going Concern (Details Narrativ
Going Concern (Details Narrative) - USD ($) | 12 Months Ended | ||
Dec. 31, 2019 | Dec. 31, 2018 | Dec. 31, 2017 | |
Going Concern | |||
Net loss | $ (3,028,918) | $ (1,852,712) | |
Shareholder's equity | 3,878,161 | 5,034,364 | $ 6,129,273 |
Working capital deficit | (23,772,002) | (14,114,724) | |
Cash and cash equivalents | $ 1,076,995 | $ 1,026,533 |
Summary of Significant Accoun_4
Summary of Significant Accounting Policies (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Net revenue, by offtake type | ||
Feed in tariff | $ 1,653,186 | $ 829,794 |
Green Certificates | 631,740 | 789,740 |
Energy offtake Agreements | 300,642 | 973,430 |
Total | $ 2,585,568 | $ 2,592,964 |
Summary of Significant Accoun_5
Summary of Significant Accounting Policies (Details 1) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Changes in derivative liabilities | ||
Balance - beginning of the year | $ 338,861 | $ 0 |
Derivative liability | 0 | 338,861 |
Change in fair value of derivative liability | 132,976 | 0 |
Reclassification of derivative liability | (471,837) | 0 |
Balance - end of year | $ 0 | $ 338,861 |
Summary of Significant Accoun_6
Summary of Significant Accounting Policies (Details 2) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Summary of Significant Accounting Policies (Details) | ||
Cash and cash equivalents | $ 1,076,995 | $ 1,026,533 |
Restricted cash | 349,434 | 8,857,966 |
Total cash, cash equvalents, and restricted cash | $ 1,426,429 | $ 9,884,499 |
Summary of Significant Accoun_7
Summary of Significant Accounting Policies (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Operating loss carryforwards, limitations on use | As a result of Tax Cuts and Jobs Act, net operating losses generated in 2018 and beyond have indefinite lives, but limited to 80% of taxable income in each year. | |
Accrued charges | $ 180,000 | |
Warrants | 13,053,235 | 12,286,213 |
Convertible shares | 8,828,233 | 4,360,105 |
Accumulated comprehensive gain (loss) | $ (382,190) | $ (466,299) |
U.S. federal and state net operating loss carryovers | $ 4,667,136 | 1,727,412 |
U.S. federal and state net operating loss carryovers expiration date | which will expire at various dates beginning in 2034 through 2037 | |
U.S. federal capital loss carryovers | $ 949,875 | 949,875 |
U.S. federal capital loss carryovers expiration date | which will expire at various dates beginning in 2020 through 2022 | |
Change in valuation allowance | $ 926,792 | 960,552 |
Valuation allowance | 1,887,344 | 960,552 |
Reclassification of derivative liability | $ 471,837 | $ 0 |
Customer [Member] | ||
Revenue | 56.00% | 32.00% |
Accounts receivable | 37.00% | |
Customer 1 [Member] | ||
Revenue | 30.00% | 21.00% |
Accounts receivable | 9.00% | |
April 15, 2019 [Member] | ||
Reclassification of derivative liability | $ 471,837 | |
Warrant fixed price | $ 0.122 | |
Change in fair value of derivative liability | $ 132,976 | |
Remaining warrants term | 2 years 6 months | |
Risk free interest rate | 2.94% | |
Warrants floor price | 0.122 | |
Class A common stock [Member] | ||
Common stock shares issued | 68,182,602 | 16,646,318 |
Common Stock [Member] | ||
Debt conversion converted instrument shares issued | 50,000,000 | |
Series E Convertible Preferred Stock [Member] | ||
Debt conversion converted instrument shares issued | 5,000,000 | |
Solar Energy Facilities [Member] | ||
Estimated useful lives | 20 years |
Acquisitions and dispositions_2
Acquisitions and dispositions (Details) | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Cost of Acquisition | |
Acquisition price | $ 11,651,997 |
Net working capital acquired | 419,011 |
Total Acquisition Cost | 12,071,008 |
Fair Value of Assets Acquired | |
Present value of the future cash flows | 9,853,884 |
Net working capital acquired | 419,011 |
Total Fair value of assets acquired | 10,272,895 |
Goodwill | $ 1,798,113 |
Acquisitions and dispositions_3
Acquisitions and dispositions (Details 1) | Dec. 31, 2019USD ($) |
Cost of acquisitions | |
Cash paid for assets | $ 6,131,004 |
Total acquisition cost | 6,131,004 |
Fair value of assets acquired | |
Investment in energy property | 9,939,414 |
Net working capital acquired | 384,397 |
Assets retirement liability | (65,114) |
Total | 10,258,697 |
Gain on bargain purchase | $ 4,127,693 |
Acquisitions and dispositions_4
Acquisitions and dispositions (Details 2) | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Acquisition Cost | |
Cash paid for assets | $ 4,177,206 |
Taxes paid at closing | 131,394 |
Total acquisition cost | 4,308,600 |
Fair value of assets acquired | |
NPV of discounted cash flow | 5,790,731 |
Net working capital acquired | 148,685 |
Less asset retirement obligation | (57,013) |
Net fair value of assets acquired | 5,882,403 |
Gain on bargain purchase | $ 1,573,803 |
Acquisitions and dispositions_5
Acquisitions and dispositions (Details 3) - USD ($) | 1 Months Ended | 12 Months Ended |
Sep. 30, 2018 | Dec. 31, 2018 | |
Acquisitions and dispositions | ||
Proceeds from sale | $ 3,760,155 | |
Net carrying cost of asset at time of sale | (4,688,212) | |
Net working capital adjustment | 246,636 | |
Loss on sale of asset and related operating companies | $ (681,421) | $ (681,421) |
Acquisitions and dispositions_6
Acquisitions and dispositions (Details 4) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Acquisitions and dispositions | ||
Revenue, net | $ 4,347,671 | $ 4,011,556 |
Net (loss) | $ (6,544,295) | $ (3,208,498) |
Net (loss) per share | $ (0.07) | $ (0.04) |
Basic weighted average number of shares outstanding | 97,969,579 | 71,600,361 |
Acquisitions and dispositions_7
Acquisitions and dispositions (Details Narrative) - USD ($) | 1 Months Ended | 12 Months Ended | |
Dec. 20, 2019 | Sep. 30, 2018 | Dec. 31, 2019 | |
Fair value of net assets acquired | $ 9,900,000 | ||
Description of acquisition | The total acquisition consisted of 7 operating photovoltaic plants located in Italy having a total installed capacity of 5.1 MWs in exchange for approximately $8.1M cash, less $1.5M held back for the acquisition of the 5th SPV, and less $0.4M held in escrow for 2 months from closing against certain tax open items and as a hold back for any unexpected items not found in due diligence. | ||
Description of Risen acquisition | Subsequent to the acquisition of Risen facility, Alternus Energy signed a letter of intent with Risen to purchase an additional 10MWs of similar solar Projects at a price of 18.5M (euros). The price per MW was 1.85M (Euros) for an uninstalled asset as compared to the 1.35M (euros) they sold the operating asset for | ||
Acquisition cost | $ 12,071,008 | ||
Business aquisition, purchase price | 11,651,997 | ||
Proceeds from sale | $ 3,760,155 | ||
Alternus [Member] | |||
Loan payable | 1,900,000 | ||
Annual revenues | $ 1,300,000 | ||
Gross margin percentages | 75.00% | ||
Acquisition related costs, transaction fees | $ 600,000 | ||
Due date | Jan. 31, 2020 | ||
July 29, 2019 [Member] | Accredited Investor [Member] | |||
Amortizing over year | 8 years | ||
Business aquisition, purchase price | $ 2,100,000 | ||
Proceeds from issuance of bond | $ 2,400,000 | ||
Interest rate | 8.00% | ||
Zonepark Rilland [Member] | |||
Description of acquisition | The Purchase Price includes the assumption of a third-party senior bank debt facility in the amount $8.3 million), that amortizes equally over the next 14 years. We also acquired the various offtake and operations contracts for the solar plant. In addition to the Purchase Price, the Seller will be entitled to receive additional consideration from ALTN of up to a maximum $560,000 in the form of an earn-out payment based on net cash proceeds to equity received over and above a set annual power output of 10,865 MwH. | ||
Amortizing over year | 14 years | ||
Senior bank debt facility | $ 8,300,000 | ||
Acquisition cost | $ 11,700,000 | ||
2018 Acquisition of Liquid Sun S.R.L. [Member] | December 18, 2018 [Member] | |||
Fair value of net assets acquired | $ 5,800,000 | ||
Description of acquisition | Netherlands’ subsidiary, closed the acquisition of certain assets, agreements and liabilities of Liquid Sun Srl, an Italian company, related to three photovoltaic installations located on three power plants with a total of 2,244.37 KW of power located in the Budrio and Anagni regions of Italy in exchange for approximately $4.3M, plus working capital, and transaction costs, commissions and required Italian taxes. | ||
2018 Acquisition of GRT 1.1 GmbH [Member] | December 21, 2018 [Member] | |||
Cash paid on aquisition | $ 26,434 | ||
Ownership percentages | 100.00% | ||
Full settlement of third party liabilities | $ 43,046 | ||
Repayment of third party | 160,845 | ||
Loan payable | 876,005 | ||
2018 Acquisition of PSM 40 GmbH & Co KG [Member] | December 28, 2018 [Member] | |||
Cash paid on aquisition | $ 115 | ||
Ownership percentages | 100.00% | ||
Cash | $ 570,000 | ||
Immediately paid in cash | 427,000 | ||
Remaining balance | 142,500 | ||
2018 Acquisition of GRK 17.2 GmbH & Co KG [Member] | November 20, 2018 [Member] | |||
Cash paid on aquisition | $ 115 | ||
Ownership percentages | 100.00% | ||
Cash | $ 419,408 | ||
2018 Acquisition of PSM 20 GmbH & Co KG [Member] | June 7, 2018 [Member] | |||
Cash paid on aquisition | 115 | ||
Cash | $ 1,300,000 | ||
2018 Disposition of Tre Valli Energia S.R.L [Member] | |||
Proceeds from sale | $ 3,760,155 | ||
Sold of the share capital percentages | 100.00% |
Investment in Energy Property_3
Investment in Energy Property and Equipment, Net (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Investment in Energy Property and Equipment, Net | ||
Solar energy facilities operating | $ 36,123,412 | $ 16,278,252 |
Less accumulated depreciation and amortization | (2,663,934) | (1,538,485) |
Net assets | $ 33,459,478 | $ 14,739,767 |
Investment in Energy Property_4
Investment in Energy Property and Equipment, Net (Details 1) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Investment in Energy Property and Equipment, Net | ||
Capitalized costs relating to PV plants | $ 2,311,255 | $ 2,358,588 |
Less accumulated amortization | (321,821) | (208,989) |
Net assets | $ 1,989,434 | $ 2,149,599 |
Investment in Energy Property_5
Investment in Energy Property and Equipment, Net (Details Narrative) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Net investment in energy property | $ 33,459,478 | |
Depreciation and amortization expense | $ 1,193,107 | $ 699,573 |
Minimum [Member] | ||
Estimate useful life of energy property and intangible asset | 14 years | |
Maximum [Member] | ||
Estimate useful life of energy property and intangible asset | 20 years |
Capital Leases (Details )
Capital Leases (Details ) - Capital Leases [Member] | Dec. 31, 2019USD ($) |
2020 | $ 140,009 |
2021 | 140,009 |
2022 | 140,009 |
2023 | 140,009 |
2024 | 140,009 |
Thereafter | 606,704 |
Total | 1,306,749 |
Less interest expense | (295,015) |
Net lease payable | $ 1,011,734 |
Capital Leases (Details Narrati
Capital Leases (Details Narrative) | 12 Months Ended |
Dec. 31, 2019USD ($) | |
Capital Leases | |
Short term portion of lease payable | $ 87,785 |
Remaining of the lease | $ 1,011,734 |
Term expected (in years) | 18 years |
Average interest rate | 4.50% |
Convertible and Unconvertible_3
Convertible and Unconvertible Promissory Notes (Details) - USD ($) | Dec. 31, 2019 | Dec. 31, 2018 |
Convertible and Unconvertible Promissory Notes | ||
Short term line of credit | $ 35,120 | $ 73,560 |
Promissory notes related parties | 48,821 | 207,753 |
Convertible notes related parties | 291,540 | 284,000 |
Senior secured debt | 19,575,794 | 10,192,603 |
Promissory notes | 15,478,536 | 13,278,803 |
Convertible promissory notes | 2,169,401 | 1,097,289 |
Gross debt | 37,599,212 | 25,134,007 |
Debt discount | (784,130) | (303,563) |
Net debt | 36,815,082 | 24,830,444 |
Less current maturities | (22,705,665) | (14,510,204) |
Long Term Debt, net of current maturities | $ 14,109,418 | $ 10,320,240 |
Convertible and Unconvertible_4
Convertible and Unconvertible Promissory Notes (Details 1) | Dec. 31, 2019USD ($) |
2020 [Member] | |
Gross debt | $ 23,129,751 |
Debt discount | (424,084) |
Net debt | 22,705,667 |
2021 [Member] | |
Gross debt | 1,102,888 |
Debt discount | (360,046) |
Net debt | 742,842 |
2022 [Member] | |
Gross debt | 1,108,229 |
Net debt | 1,108,229 |
2023 [Member] | |
Gross debt | 1,113,219 |
Net debt | 1,113,219 |
2024 [Member] | |
Gross debt | 1,118,312 |
Net debt | 1,118,312 |
Thereafter [Member] | |
Gross debt | 10,026,813 |
Net debt | 10,026,813 |
Total [Member] | |
Gross debt | 37,599,212 |
Debt discount | (784,130) |
Net debt | $ 36,815,082 |
Convertible and Unconvertible_5
Convertible and Unconvertible Promissory Notes (Details Narrative) | 12 Months Ended | |
Dec. 31, 2019USD ($)integer$ / sharesshares | Dec. 31, 2018USD ($) | |
Line of credit facility | $ 35,120 | $ 73,560 |
Promissory notes related parties | 48,821 | 207,753 |
Convertible debt | 36,815,082 | 24,830,444 |
Convertible notes related parties | 291,540 | 284,000 |
Debt discount | $ (784,130) | (303,563) |
July 2018 [Member] | Convertible Promissory Note [Member] | ||
Maturity date | Jan. 30, 2020 | |
Accrued interest rate | 15.00% | |
Conversion price | $ / shares | $ 0.20 | |
Remaining principal amount | $ 304,294 | 251,666 |
December 2019 [Member] | ||
Principal amount | $ 2,411,167 | |
Term of loan | 8 years | |
Interest rate | 8.00% | |
Bond issued | $ 2,400,000 | |
Foreign Consultant [Member] | July 2018 [Member] | Convertible Promissory Note [Member] | ||
Principal amount | $ 80,000 | |
Maturity date | Jan. 30, 2020 | |
Accrued interest rate | 15.00% | |
Conversion price | $ / shares | $ 0.20 | |
Remaining principal amount | $ 89,718 | 91,555 |
GLS Bank [Member] | April 2018 [Member] | ||
Principal amount | $ 2,515,866 | 22,529,212 |
Term of loan | 18 years | |
Interest rate | 2.00% | |
Net book value of the collateralized asset | $ 3,069,655 | 3,191,370 |
Power Clouds S.R.L [Member] | In 2016 [Member] | OTP Bank in Romania [Member] | ||
Principal amount | $ 423,783 | 698,820 |
Term of loan | 60 months | |
Net book value of the collateralized asset | $ 2,766,577 | $ 3,055,976 |
Senior secured debt | $ 1,592,500 | |
Accrued interest annually rate description | Power Clouds Romania, accruing interest annually at a rate of ROBOR 3M + 3.3% | |
Power Clouds S.R.L [Member] | In 2016 [Member] | OTP Bank [Member] | ||
Line of credit facility | $ 77,000 | |
Accrued interest rate | 6.64% | 6.60% |
Accrued interest annually rate description | Drawn funds accrue interest annually at a rate of ROBOR 3M + 3.3% | |
Line of credit, initial term | 12 months | |
Zonnepark Rilland BV One [Member] | ||
Principal amount | $ 1,895,137 | |
Loan issued to related party | $ 1,900,000 | |
Maturity date | Jan. 31, 2020 | |
Lender [Member] | February 2019 [Member] | Convertible Promissory Note [Member] | Securities Purchase Agreement [Member] | ||
Conversion price | $ / shares | $ 0.20 | |
Remaining principal amount | $ 294,118 | |
Original issue discount rate | 15.00% | |
Total investment | $ 300,000 | |
Expected term | 4 years | |
Exercise price | $ / shares | $ 0.25 | |
Debt discount | $ 123,805 | |
Number of investors | integer | 4 | |
Warrants issued to purchase common shares description | A warrant to purchase shares of the Corporation’s common stock equal to 50% of the total number of shares if the Note is fully converted, divided by the Exercise Price of $0.25, (equal to a total of 750,000 warrants) subject to adjustment as provided. | |
Lender [Member] | May 2019 [Member] | Convertible Promissory Note [Member] | Securities Purchase Agreement [Member] | ||
Conversion price | $ / shares | $ 0.25 | |
Remaining principal amount | $ 176,471 | |
Original issue discount rate | 15.00% | |
Total investment | $ 150,000 | |
Warrants cost | $ 36,000 | |
Expected term | 3 years | |
Exercise price | $ / shares | $ 0.30 | |
Debt discount | $ 110,118 | |
Number of investors | integer | 4 | |
Warrants issued to purchase common shares description | A warrant to purchase shares of the Corporation’s common stock equal to 25% of such Lender’s investment divided by the Conversion Price of $0.25, subject to adjustment as provided. | |
Lender [Member] | May 2019 [Member] | Convertible Promissory Note [Member] | Securities Purchase Agreement [Member] | Noteholder [Member] | ||
Accrued interest rate | 12.00% | |
Conversion price | $ / shares | $ 0.25 | |
Remaining principal amount | $ 500,000 | |
Total investment | 500,000 | |
Lender [Member] | AE Europe B.V. [Member] | In June of 2019 [Member] | ||
Principal amount | $ 9,676,069 | |
Interest rate description | An interest rate of 7.5% until October of 2019 and then 10% thereafter. | |
Term of loan | 10 months | |
Lender [Member] | AE Europe B.V. [Member] | In March of 2019 [Member] | ||
Principal amount | $ 3,398,063 | |
Term of loan | 12 months | |
Interest rate | 12.00% | |
Lender [Member] | PCG [Member] | ||
Principal amount | $ 504,667 | $ 4,421,147 |
Term of loan | 6 months | |
Interest rate | 12.00% | |
Lender [Member] | PCG [Member] | October 2018 [Member] | ||
Principal amount | $ 3,585,366 | $ 3,644,585 |
Term of loan | 2 years | |
Interest rate | 12.00% | |
Lender [Member] | Power Clouds Europe B.V. [Member] | ||
Principal amount | $ 8,857,656 | |
Term of loan | 6 months | |
Interest rate | 12.00% | |
World Global Assets Pte. Ltd. [Member] | September 30, 2015 [Member] | Convertible Promissory Note One [Member] | ||
Principal amount | $ 509,267 | $ 509,267 |
Maturity date | Dec. 31, 2020 | |
Interest rate | 7.50% | |
Convertible debt | $ 492,000 | |
World Global Assets Pte. Ltd. [Member] | September 30, 2015 [Member] | Convertible Promissory Note [Member] | ||
Term of loan | 3 years | |
Convertible debt | $ 1,000,000 | |
Conversion price | $ / shares | $ 0.20 | |
World Global Assets Pte. Ltd. [Member] | September 30, 2016 [Member] | Convertible Promissory Note [Member] | ||
Convertible debt | $ 300,000 | |
Remaining principal amount | $ 244,800 | 244,800 |
Floor price | $ / shares | $ 0.20 | |
Zonnepark Rilland BV [Member] | ||
Line of credit facility | $ 7,700,000 | |
Principal amount | $ 7,366,816 | |
Term of loan | 14 years | |
Interest rate | 1.70% | |
Net book value of the collateralized asset | $ 9,958,300 | |
MVB Bank [Member] | October 2018 [Member] | ||
Principal amount | $ 671,446 | 718,683 |
Term of loan | 19 years | |
Interest rate | 2.05% | |
Net book value of the collateralized asset | $ 820,857 | 881,724 |
Sparkase Bank [Member] | December 2018 [Member] | ||
Principal amount | $ 2,251,298 | 2,587,081 |
Term of loan | 18 years | |
Interest rate | 2.10% | |
Net book value of the collateralized asset | $ 2,775,033 | 2,763,652 |
VestCo Corp [Member] | February 2019 [Member] | Securities Purchase Agreement [Member] | ||
Principal amount | $ 291,540 | |
Term of loan | 4 years | |
Original issue discount rate | 15.00% | |
Debt instrument conversion price per share | $ / shares | $ 0.20 | |
Warrant issue to purchase Class A common stock | shares | 619,522 | |
Warrants exercisable price | $ / shares | $ 0.25 | |
Convertible notes related parties | $ 284,000 | |
Two Accredited Investors [Member] | November of 2019 [Member] | Convertible Promissory Note [Member] | ||
Principal amount | $ 280,000 | |
Maturity date | Nov. 21, 2020 | |
Interest rate | 12.00% | |
Remaining principal amount | $ 560,000 | |
Conversion description | Convertible at 70% of the lowest trading price of the Company’s Common Stock for the last 15 trading days prior to conversion | |
Restricted Class A common stock issued | shares | 145,000 | |
Original issue discount | $ 25,000 | |
Restricted Class C common stock issued | shares | 725,000 |
Commitments and Contingencies_2
Commitments and Contingencies (Details) - Operating Leases [Member] | Dec. 31, 2019USD ($) |
2020 | $ 211,291 |
2021 | 211,243 |
2022 | 211,243 |
2023 | 211,243 |
2024 | 211,243 |
Thereafter | 2,309,328 |
Operating Leases, Future Minimum Payments Due | $ 3,365,591 |
Commitments and Contingencies_3
Commitments and Contingencies (Details Narrative) - USD ($) | Mar. 06, 2019 | Dec. 31, 2019 |
Estimated payments (Quarterly) | $ 55,038 | |
Term of lease | 10 years | |
Security deposit | $ 36,820 | |
Term of security deposit | 6 months | |
Combined estimated annual cost (2020) | $ 16,331 | |
Combined estimated annual cost (Thereafter) | $ 16,283 | |
Term of lease commencement | 20 years | |
Outstanding loan | $ 1,689,864 | |
Zonepark Rilland [Member] | ||
Term of lease | 25 years | |
Annual lease payment (First fifteen years) | $ 139,923 | |
Annual lease payment (Years sixteen through twenty five) | 55,969 | |
Ultramar Energy Ltd [Member] | ||
Proceeds from private placement | 3,000,000 | |
Repayment of loans | $ 2,000,000 |
Shareholders' Deficit (Details)
Shareholders' Deficit (Details) - Warrant [Member] - $ / shares | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Warrants | ||
Warrants, Balance, January 1, 2019 | 12,286,213 | 1,240,000 |
Warrants, Expired during the period | (640,000) | (600,000) |
Warrants, Granted during the period | 1,407,022 | 11,646,213 |
Warrants, end of period | 13,053,235 | 12,286,213 |
Warrants, Exercisable end of period | 13,053,235 | 12,286,213 |
Average Exercise Price | ||
Weighted average exercise price, Balance, January 1, 2019 | $ 0.13 | $ 0.20 |
Weighted average exercise price, Expired during the period | 0.20 | 0.20 |
Weighted average exercise price, Granted during the period | 0.26 | 0.13 |
Weighted average exercise price, end of period | 0.15 | 0.13 |
Weighted average exercise price, Exercisable end of period | $ 0.15 | $ 0.13 |
Shareholders' Deficit (Details
Shareholders' Deficit (Details Narrative) - USD ($) | Oct. 09, 2019 | Aug. 19, 2019 | Dec. 31, 2019 | Dec. 31, 2018 |
Revised authorized common shares | 450,000,000 | |||
Stock compensation costs | $ 1,513,214 | $ 516,500 | ||
Derivative liability | 0 | 338,861 | ||
Amortization of debt discount | $ 269,922 | $ 707,603 | ||
Warrants issued | 13,053,235 | 12,286,213 | ||
Stock Incentive Plan [Member] | June, 2019 [Member] | ||||
Common stock available for issuance | 22,500,000 | |||
Class A common stock [Member] | ||||
Common stock shares issued for exchange of shares | 30,000,000 | |||
Restricted stock shares issued | 9,250,000 | |||
Restricted stock shares issued value | $ 516,500 | |||
Series D Convertible Preferred Stock [Member] | ||||
Conversion of Convertible Preferred Stock | 30,000,000 | |||
Class B Common Stock [Member] | ||||
Common stock shares issued for exchange of shares | 15,000,000 | |||
Warrant Three [Member] | ||||
Warrants issued | 5,299,385 | |||
Exercise price | $ 0.122 | |||
Expected term | 3 years | |||
Warrant One [Member] | ||||
Warrants issued | 1,257,022 | 1,687,500 | ||
Exercise price | $ 0.25 | $ 0.20 | ||
Expected term | 4 years | 5 years | ||
Warrants issued to purchase restricted common stock | $ 13,053,235 | $ 11,646,213 | ||
Volatility | 3.20% | |||
Risk free rate | 1.90% | |||
Warrant One [Member] | Maximum [Member] | ||||
Remaining term | 4 years | |||
Warrant One [Member] | Minimum [Member] | ||||
Remaining term | 3 years | |||
Warrant Two [Member] | ||||
Warrants issued | 150,000 | 4,659,328 | ||
Expected term | 3 years | 3 years | ||
Exercise price | $ 0.30 | $ 0.122 | ||
Officers And Director [Member] | ||||
Common stock shares issued for for continued services and performance | 16,000,000 | |||
VestCo [Member] | ||||
Treasury stock shares | 15,000,000 | |||
Growthcap Investments Inc. [Member] | ||||
Common stock, shares cancelled | 50,000,000 | |||
Convertible preferred stock, exchange shares | 5,000,000 | |||
Consultants [Member] | ||||
Common stock, shares issued for services | 5,855,000 | |||
Common stock, shares issued as fees | 600,876 |
Related Party Transactions (Det
Related Party Transactions (Details Narrative) - USD ($) | 1 Months Ended | 12 Months Ended | |
Oct. 31, 2018 | Dec. 31, 2019 | Dec. 31, 2018 | |
Proceeds from related party | $ 0 | $ 147,000 | |
TES [Member] | |||
Amount payable for settlement | $ 100,000 | ||
Director [Member] | |||
Proceeds from related party | $ 50,000 | $ 10,000 |
Geographical Information (Detai
Geographical Information (Details) - USD ($) | 12 Months Ended | |
Dec. 31, 2019 | Dec. 31, 2018 | |
Revenues | $ 2,585,568 | $ 2,592,964 |
Cost of Revenue | 738,097 | 1,278,614 |
Gross Profit | 1,847,471 | 1,314,350 |
Investment In Energy Property and Equipment, Net | 33,459,478 | 14,739,767 |
Italy [Member] | ||
Revenues | 1,533,298 | 829,794 |
Gross Profit | 1,327,149 | 697,018 |
Investment In Energy Property and Equipment, Net | 17,067,553 | 8,048,477 |
Cost of Revenue | 206,149 | 132,776 |
Romania [Member] | ||
Revenues | 932,382 | 1,763,170 |
Gross Profit | 442,381 | 617,332 |
Investment In Energy Property and Equipment, Net | 4,772,109 | 5,272,802 |
Cost of Revenue | 490,001 | 1,145,838 |
Germany [Member] | ||
Revenues | 106,734 | 0 |
Gross Profit | 64,787 | 0 |
Investment In Energy Property and Equipment, Net | 1,661,516 | 0 |
Cost of Revenue | 41,947 | 0 |
Netherlands [Member] | ||
Revenues | 13,154 | 0 |
Gross Profit | 13,154 | 0 |
Investment In Energy Property and Equipment, Net | 9,958,300 | 1,418,488 |
Cost of Revenue | $ 0 | $ 0 |
Subsequent Events (Details Narr
Subsequent Events (Details Narrative) - USD ($) | 1 Months Ended | 12 Months Ended | ||||||||||
Aug. 12, 2020 | May 22, 2020 | Apr. 07, 2020 | Mar. 31, 2020 | Mar. 24, 2020 | Mar. 20, 2020 | Feb. 29, 2020 | Jan. 31, 2020 | Dec. 31, 2019 | Dec. 31, 2018 | Jun. 12, 2020 | Dec. 31, 2017 | |
Expected gross proceeds from the Private Placement | $ 3,000,000 | |||||||||||
Owed amounts | $ 0 | $ 147,000 | ||||||||||
Class A common stock [Member] | ||||||||||||
Common stock shares issued | 68,182,602 | 16,646,318 | ||||||||||
Common stock shares issued | 68,182,601 | 110,726,725 | 71,476,725 | |||||||||
Italy [Member] | ||||||||||||
Purchase price | $ 15,400,000 | |||||||||||
Subsequent Event [Member] | ||||||||||||
Common stock, shares par value | $ 0.10 | |||||||||||
Subsequent Event [Member] | Zonnepark Rilland [Member] | Settlement Agreement [Member] | ||||||||||||
Expected gross proceeds from the Private Placement | $ 3,000,000 | |||||||||||
Owed amounts | $ 2,000,000 | |||||||||||
Subsequent Event [Member] | GII [Member] | ||||||||||||
Conversion of Series E Convertible Preferred Stock | $ 50,000,000 | |||||||||||
Stated value | $ 0.001 | |||||||||||
Class A common stock issued upon convesion of stock | 50,000,000 | |||||||||||
Subsequent Event [Member] | Class A common stock [Member] | Two Consultants [Member] | ||||||||||||
Common stock shares issued | 700,000 | |||||||||||
Closing stock price | $ 77,000 | |||||||||||
Subsequent Event [Member] | Class A Common Stock [Member] | ||||||||||||
Common stock shares issued | 135,368 | |||||||||||
Options issued aganist the purchase of restricted common stock | 100,000 | 33,250 | ||||||||||
Common stock issued per shares | $ 0.10 | |||||||||||
value of shares issued | $ 29,150 | |||||||||||
Subsequent Event [Member] | F.R.A.N. Energy Investment SRL and Power Clouds S.R.L. [Member] | ||||||||||||
Promissory note description | The Company guaranteed a 9.15 million RON (equivalent to approximately US$2.0M) promissory note issued by both of its subsidiaries, Power Clouds S.R.L., and F.R.A.N. Energy Investment SRL two Romanian companies to OTP Bank in Romania, which is secured in first position against the Romanian solar parks and customer contracts held, accruing interest annually at a rate of ROBOR 3M + 3.3% and having a term of 10 years. | |||||||||||
Promissory note issued | $ 9,150,000 | |||||||||||
Subsequent Event [Member] | MVB Bank [Member] | ||||||||||||
Term of loan | 1 year | |||||||||||
Interest rate | 6.50% | |||||||||||
Construction financing loan | $ 3,900,000 | |||||||||||
Subsequent Event [Member] | Investor [Member] | Securities Purchase Agreement [Member] | ||||||||||||
Common stock, shares par value | $ 0.001 | |||||||||||
Term of loan | 1 year | |||||||||||
Proceeds from issuance of common stock | $ 3,000,000 | |||||||||||
Common stock shares issued | 30,000,000 | |||||||||||
Warrant issue to purchase Class A common stock | 12,000,000 | |||||||||||
Warrants exercisable price | $ 0.125 | |||||||||||
Subsequent Event [Member] | Lender [Member] | Securities Purchase Agreement [Member] | ||||||||||||
Term of loan | 2 years | |||||||||||
Interest rate | 10.00% | 12.00% | ||||||||||
Conversion price | $ 0.20 | |||||||||||
Proceeds from convertible promissory note | $ 105,000 | $ 250,000 | ||||||||||
Conversion price description | promissory note convertible at 65% of the lowest trading price of the Company’s Class A Common Stock for the last 15 trading days prior to conversion | |||||||||||
Maturity date | Feb. 10, 2021 |