Westinghouse Solar and CBD Energy have jointly announced the signing of a definitive merger agreement. The merger has been approved by the Boards of Directors of both companies and consummation is targeted for third quarter 2012, subject to satisfaction of limited closing conditions and approval by both companies' shareholders.

The common shareholders of Westinghouse Solar will receive approximately 3.7 CBD common shares for each share held and its preferred shareholders will receive CBD preferred shares which will be convertible into CBD common shares.

On an as-converted basis the Westinghouse Solar common and preferred shareholders collectively would hold approximately 15% of the outstanding CBD common shares, calculated as-if the merger was consummated on the signing date.

Upon consummation of the merger, the combined company is expected to trade on a U.S. exchange.

Upon execution of the Merger Agreement, Margaret Randazzo (CFO of Westinghouse Solar) was also appointed Interim CEO; former CEO Barry Cinnamon is leaving the company.

Ms. Randazzo stated that, "From our initial meetings in December of 2011, it was evident to the management and directors of both companies that there were substantial benefits to be realized through a business combination.

"This transaction is expected to improve the financial standing of Westinghouse Solar allowing the company to better serve its established customers in the US and creating a more solid platform for international growth.

"Our team is excited about the enhanced opportunities this transaction provides both companies and the benefits for our shareholders. We look forward to being an engine of growth for CBD's global renewable energy business."

Interim Operations and Joint Business Development Initiatives
Westinghouse Solar will continue to produce and sell its innovative rooftop solar power systems in the US and will have near-term opportunities to distribute its systems in Australia and Europe through CBD. Westinghouse Solar has already implemented cost reductions in anticipation of the Merger that are expected to save in excess of $1.0 million annually.

Elimination of duplicative public listing costs, reduction of overlapping corporate overhead and supply-chain efficiencies are expected to yield additional benefits to the combined enterprise.

Westinghouse Solar and CBD have already begun exploring the development of commercial projects and partnerships in North America. In addition, CBD has begun introducing the Westinghouse Solar products to its Australian distribution partners and is pursuing opportunities to increase contract volumes with its current customers who would deploy the Westinghouse Solar technology.

CBD Energy Executive Outlook
Managing Director and CEO of CBD, Gerry McGowan, said "The merger with Westinghouse Solar is expected to be highly beneficial for CBD. The US market is rapidly developing into one of the largest and most stable end-markets for solar energy systems. The merger provides CBD an immediate point of access with an experienced management team capable of driving rapid expansion for the combined business.

We expect to leverage the Westinghouse Solar relationships to provide new opportunities for distributing energy-efficiency products and services produced by our Industrial Energy Efficiency Division and to create new outlets and applications for our proprietary energy storage technology.

The merger is an important step in CBD's strategy of growing a portfolio of revenue streams diversified across profitable customer segments, geographies, and technologies.

Also important for CBD's shareholders is the improved liquidity CBD anticipates will accompany the shift to a U.S. listing upon closing of the merger. CBD plans to apply for listing on NASDAQ because it is host to the world's largest collection of cleantech public companies and attracts a corresponding level of investor attention."

CBD Energy has experienced significant growth over the past three fiscal years ended June 30, with revenues growing from approximately A$17M for its fiscal year ended June 30 2009, to A$165M in FY2011. During the same three-year period EBITDA increased from a loss of A$3.3M in FY2009 to profits of A$7.9 in FY 2010 and A$4.8M in FY2011.

To capitalize on its European project pipeline, CBD recently announced the closing of a $25 million credit facility that will permit it to develop projects utilizing a Build-Operate-Transfer ("BOT") model to deliver turnkey projects to institutional acquirers of revenue-generating renewable assets. When fully utilized, the credit facility is sufficient to support the development and sale of solar projects totaling more than A$35 million revenue per quarter.

Consequently, CBD is now able to prioritize projects in its current pipeline, focusing on those with potential net contribution margins above 10%. CBD expects to expand this credit facility in the future for application to additional projects in North America that would utilize products and capabilities of Westinghouse Solar.