Exhibit 99.2
AKEENA SOLAR, INC.
INTRODUCTION TO PRO FORMA CONDENSED
COMBINED FINANCIAL STATEMENTS
(Unaudited)
The following unaudited pro forma condensed combined financial statements give
effect to the merger transaction between Akeena Solar, Inc. ("Akeena") and
Fairview Energy Corporation, Inc ("Fairview"). On August 11, 2006, Akeena merged
into Fairview whereby 100% of the shares of Akeena were exchanged for 8,000,000
shares of Fairview, a public shell corporation, and Fairview changed its name to
Akeena. As a result of the transaction, the former owners of Akeena became the
controlling stockholders of Fairview. Accordingly, the merger of Akeena and
Fairview is a reverse merger that has been accounted for as a recapitalization
of Akeena.
The following unaudited pro forma condensed combined balance sheet combines the
balance sheet of Akeena with Fairview as of March 31, 2006, as if the
recapitalization of Akeena occurred on that date. The following unaudited pro
forma earnings per share calculations are based upon the condensed combined
statements of operations which combine the results of operations of Akeena with
Fairview for the three months ended March 31, 2006 and for the year ended
December 31, 2005, as if the aforementioned transaction had occurred at the
beginning of the respective periods.
The unaudited pro forma balance sheet and earnings per share data should be read
in conjunction with the separate historical financial statements of Akeena,
appearing elsewhere herein, and the historical financial statements of Fairview,
as filed and included in Form 10-QSB for the quarterly period ended April 30,
2006 and Form SB-2 for the annual period ended October 31, 2005. The fiscal year
end of Akeena and Fairview is December 31 and October 31, respectively. The pro
forma condensed statement of income of Fairview is within the allowable 93 days
of the most recent quarterly period end of Akeena (Note 2). The unaudited pro
forma balance sheet and earnings per share data are not necessarily indicative
of the combined financial position, had the acquisition occurred on March 31,
2006.
AKEENA SOLAR, INC.
NOTES TO PRO FORMA CONDENSED COMBINED BALANCE SHEET
(Unaudited)
NOTE 1 - Merger Transaction
Akeena Solar, Inc. ("Akeena") entered into a merger agreement with Fairview
Energy Corporation, Inc. ("Fairview"), a public shell corporation, whereby
100% of the shares of Akeena were exchanged for 8,000,000 shares of
Fairview common stock. Fairview changed its name to Akeena and as a result
of the transaction, the former owners of Akeena became the controlling
stockholders of Fairview. Accordingly, the merger of Akeena and Fairview
(the "Merger") is a reverse merger that has been accounted for as a
recapitalization of Akeena.
NOTE 2 - Pro Forma Adjustments
The pro forma adjustments to the condensed balance sheet give effect to the
recapitalization of Akeena as if the transactions had occurred at the
beginning of the period.
Balance Sheet - March 31, 2006
a. Derived from the unaudited balance sheet of Akeena as of March 31,
2006.
b. Derived from the unaudited balance sheet of Fairview as of April 30,
2006.
c. Akeena common shares adjusted from $.01 par value to $.001 par value.
d. Cancellation of 1,000,000 shares of Akeena common stock upon closing
of the Merger.
e. Issuance of 197,692 shares of restricted stock at $.001 par value.
f. Cancellation of 3,877,477 shares of Fairview common stock in
connection with the Merger.
g. In connection with the Merger, Fairview will issue a maximum of
$3,000,000 of its common stock at $1.00 per share, in a private
placement (the "Private Placement") on terms acceptable to Akeena. As
of August 11, 2006, $2,527,500 has been issued at $1.00 per share.
h. Prior to the merger, each share of Fairview's 6,946,250 common shares
outstanding was converted into 1.084609 shares for a total of
7,533,965 common shares outstanding.
i. Elimination of Fairview accumulated deficit.
j. Adjustment made to reflect the costs relating to the Merger and the
Private Placement.
k. The 14,381,680 shares of common stock issued and outstanding consist
of 8,197,692 shares issued to the owners of Akeena and 6,183,988
shares issued to the owners of Fairview.
Earnings per share data - Three Months Ended March 31, 2006 and Year Ended
December 31, 2005
The following table sets forth the computation of pro forma basic and diluted
earnings per share for the three months ended March 31, 2006 and the year ended
December 31, 2005 as if the Merger occurred at the beginning of the respective
periods.
THREE MONTHS ENDED MARCH 31, 2006:
PRO FORMA ADJUSTMENTS PRO FORMA
AKEENA FAIRVIEW AKEENA FAIRVIEW COMBINED
(A) (B)
NET INCOME (LOSS) $ 19,630 $ (10,034) $ (265,000)(h) $ - $ (255,404)
=============== ================ =============== ================ ================
Earnings per common and common
equivalent share:
Basic $ 0.00 $ (0.00) $ (0.02)
=============== ================ ================
Diluted $ 0.00 $ (0.00) $ (0.02)
=============== ================ ================
Weighted average shares used in
computing earnings per common and
common equivalent share:
Basic 9,000,000 6,946,250 (1,000,000)(c) (3,877,477)(e) 14,381,680
=============== ================ =============== ================ ================
197,692 (d) 2,527,500 (f)
=============== ================
587,715 (g)
================
Diluted 10,000,000 6,946,250 (802,308) (762,262) 14,381,680
=============== ================ =============== ================ ================
(1,000,000)(i)
===============
YEAR ENDED DECEMBER 31, 2005:
PRO FORMA ADJMENTS PRO FORMA
AKEENA FAIRVIEW AKEENA FAIRVIEW COMBINED
(A) (B)
NET INCOME (LOSS) $ 1,852 $ (5,658) $ (265,000)(h) $ - $ (268,806)
=============== ================ =============== ================ ================
Earnings per common and common
equivalent share:
Basic $ 0.00 $ (0.00) $ (0.02)
=============== ================ ================
Diluted $ 0.00 $ (0.00) $ (0.02)
=============== ================ ================
Weighted average shares used in
computing earnings per common and
common equivalent share:
Basic 9,000,000 6,946,250 (1,000,000)(c) (3,877,477)(e) 14,381,680
=============== ================ =============== ================ ================
197,692 (d) 2,527,500 (f)
=============== ================
587,715 (g)
================
Diluted 10,000,000 6,946,250 (802,308) (762,262) 14,381,680
=============== ================ =============== ================ ================
(1,000,000)(i)
===============
a. Derived from the unaudited statement of operations of Akeena for the
three months ended March 31, 2006 and the year ended December 31,
2005, respectively.
b. Derived from the unaudited statement of operations of Fairview for the
three months ended April 30, 2006 and the three months ended January
31, 2006.
c. Cancellation of 1,000,000 shares of Akeena common stock upon closing
of the Merger.
d. Issuance of 197,692 shares of restricted stock at $.001 par value.
e. Cancellation of 3,877,477 shares of Fairview common stock in
connection with the Merger.
f. In connection with the Merger, Fairview will issue a maximum of
$3,000,000 of its common stock at $1.00 per share, in a private
placement (the "Private Placement") on terms acceptable to Akeena. As
of August 11, 2006, $2,527,500 has been issued at $1.00 per share.
g. Prior to the merger, each share of Fairview's common shares
outstanding was converted into 1.084609 shares for a total of
7,533,965 common shares outstanding.
h. Adjustment made to reflect the costs relating to the Merger and the
Private Placement.
i. Adjustment made to exclude warrants from diluted EPS calculation as
inclusion of the warrants would be antidilutive as a result of the pro
forma net loss.
AKEENA, INC.
Pro Forma Condensed Combined Balance Sheet
March 31, 2006
(Unaudited)
PRO FORMA ADJUSTMENTS
------------------------ PRO FORMA
AKEENA FAIRVIEW AKEENA FAIRVIEW COMBINED
---------- -------- --------- ---------- ----------
(A) (B)
ASSETS
Current assets
Cash and cash equivalents $ 23,245 $ 25,006 2,527,500 (g) $2,575,751
Accounts receivable, net 1,570,552 1,570,552
Inventory 1,244,579 1,244,579
Prepaid expenses and other current assets 365,348 365,348
---------- -------- --------- ---------- ----------
Total current assets 3,203,724 25,006 -- 2,527,500 5,756,230
Property and equipment, net 77,942 77,942
Due from related party 21,025 21,025
Other assets 3,927 3,927
---------- -------- --------- ---------- ----------
Total assets $3,306,618 $ 25,006 $ -- $2,527,500 $5,859,124
========== ======== ========= ========== ==========
LIABILITIES AND STOCKHOLDERS' EQUITY
Current liabilities
Accounts payable $1,906,401 $ 13,663 $1,920,064
Accrued liabilities 643,616 265,000 (j) 908,616
Deferred revenue 209,658 209,658
Credit facility 500,000 500,000
Current portion of long-term debt 16,060 16,060
---------- -------- --------- ---------- ----------
Total current liabilities 3,275,735 13,663 265,000 -- 3,554,398
Long-term debt, less current portion 21,772 21,772
---------- -------- --------- ---------- ----------
Total liabilities 3,297,507 13,663 265,000 -- 3,576,170
---------- -------- --------- ---------- ----------
Commitments and contingencies (Note 12)
Stockholders' equity:
Common stock 90,000 6,946 (81,000)(c) (3,877)(f) 14,382
(1,000)(d) 2,528 (g)
198 (e) 587 (h)
Additional paid-in capital -- 27,229 81,000 (c) 3,877 (f) 2,614,461
1,000 (d) 2,524,972 (g)
(198)(e) (587)(h)
(22,832)(i)
Retained earnings (accumulated deficit) (80,889) (22,832) (265,000)(j) 22,832 (i) (345,889)
---------- -------- --------- ---------- ----------
Total stockholders' equity 9,111 11,343 (265,000) 2,527,500 2,282,954
---------- -------- --------- ---------- ----------
Total liabilities and stockholders' equity $3,306,618 $ 25,006 $ -- $2,527,500 $5,859,124
========== ======== ========= ========== ==========
See accompanying notes to pro forma condensed combined balance sheet.
