Westinghouse Solar Expands Distribution Business

Akeena Solar, Inc. d/b/a Westinghouse Solar, (Nasdaq:

), today announced that it is expanding its distribution business to include sales in California, the largest solar market in the U.S. T o implement this distribution expansion, the company will exit its solar panel installation business in the state, focusing exclusively on its manufacturing and distribution business. This move will position the company to sell its award-winning Westinghouse Solar Power Systems directly to dealers in California for the first time. As a result of its decision to exit the California installation business, the company will record a restructuring charge of approximately $2.5 million in the third quarter of 2010, primarily related to headcount reductions, equipment and inventory write offs, lease accelerations and write off of goodwill, the vast majority of which will be non-cash charges. The company also expects to incur transition expenses from its discontinued operations for the next two quarters, after which its quarterly cash operating expense run rate is expected to be approximately $1.5 million. This represents a reduction of over $3 million in quarterly cash operating expenses compared to levels during the first and second quarters of 2010. Under this pure manufacturing and distribution business model, the company's plan is to achieve cash flow breakeven at $9 million of quarterly revenue in mid-2011, with projected revenues for 2011 in the range of $25 to $30 million.