Executive Summary

Company Snapshot Business Model - Overview

BUSINESS OVERVIEW
• Business Sector: Alternative Energy,
(Manufacturing - SOLAR)
• Maturity of Company: Development
Stage (Commercially Producing Modules)
• Main Business: The Company intends to
the the first to manufacture large, roll-
format, photo-voltaic (PV) modules in
commercial quantities.
• Origin: Ascent Solar was formed in
October 2005 from the spinout by ITN
Energy, Inc. (ITN) of its Advanced
Photovoltaic Division and its division's key
personnel and core technologies.
• Location: Thornton, Colorado (USA)
• Number of employees: 87
• Management: Deep management team
with decades of thin-film solar experience.
 CEO Dr. Farhad Moghadam(Intel, Applied Materials)
D
OPERATING STRUCTURE
  R & D: Drives competitive advantage through patented technology (6 patents), experienced R & D team (13 years
together) and decades of R & D investments.
  Manufacturing: Flexible PV modules are fabricated in an integrated sequential operation that forms complete PV
modules, eliminating traditional, costly back-end assembly of inter-cell connections.
  Sales and Distribution: Strategy is based on forming strategic relationships with key partners, including original
equipment manufacturers (OEMs) and distributors, who deal directly with installers and end-users in prime target markets.
PRODUCTS CUSTOMERS
  Products: Thin-film CIGS PV Modules on plastic substrate,   Commercial Builders & Architects: BIPV
which provide highest efficiency rates available, (Roof Tiles, Building Facades)
unprecedented flexibility and lightweight advantages.
  Consumer Electronics Manufacturers: EIPV
  Applications: Integrating solar power into various products for Consumer Electronics such as mobile phones,
and applications, including building integrated products iPods, GPS, etc.
(BPIV), electronic integrated and electronic portable
products (EIPV), defense, space, fabrics and non-flat
surfaces.   Government Military and Defense
Companies: Portable Power Packs

 Founder Dr. Mohan Misra (Lockheed Martin)

OPERATIONAL OVERVIEW
• Capacity: New manufacturing facility is in
the final stages of completion for 30 MW
plant.
 Production expected Q3 2010 with an UNIQUE SELLING POINT CUSTOMER VALUE PROPOSTION
annual rated capacity of 15 MW   High efficiency   For commercial customers: PV modules can be
 30 MW of annual capacity by Q1 2011 combined with a more readily integrated into building materials,
• Backlog: thin, lightweight, electronic products, military, and space applications,
 Supply agreement with Goal Zero LLC
flexible product that compared to competing technology.
is both low cost and
to supply up to 30,700 units of its “Premier” monolithic
module through 2010.   For military customers: By displacing
  Strategic relationship conventional fuels, the military can become more
 Supply agreement with FTL Solar LLC with Norsk Hydro cost effective by utilizing CIGS PV modules where
with a commitment of $6.5 million worth of provides direct there is no reliably operating electric grid.
access to a
PV modules over 3 years. potentially large
 Supply agreement with TurtleEnergy LLC customer base in the   For end users: There is a reduction in the overall
to supply up to 67 MW of PV modules over global BIPV market. system cost, installation cost and logistical cost-per-
watt for solar applications. 2
5 years.
 Executive Summary
Market Overview

 
Photovoltaic Market Size and Growth
Solar photovoltaics
D
Worldwide PV Installation Forecast in Megawatts  
Competitive Environment
Fragmented, intense competition
“On average, U.S. (including modules, system from C-Si PV manufacturers, other
components, and thin-film PV manufacturers and
solar companies are installation) will grow from a companies developing other solar
projecting 30-40 $30.7 billion industry in 2009 solutions, such as solar thermal and
percent annual to $898.9 billion by 2019. concentrated PV technologies.
growth in the next   Global installed watts for PV
systems will grow by 64% in The thin-film component of the
decade.” 2010, reaching 8.3 Gigawatts  
Center of Excellence (GW). As a result of solar industry is largely made up of a
and BW Research power’s benefits and broad mix of technology platforms
Partnership government support, the at various stages of development,
solar power market has seen and consists of a large and growing
number of medium- and small-
sustained and rapid growth. / sized companies.

Strategy

LOW COST PRODUCER DIFFERENTIATION STRATEGIC PARTNERS NEW MARKETS

“Steep dive in prices of
solar components
represents a permanent   Eliminate the need for costly   Differentiated, lightweight,   Strategic partnership business   In the space satellite and
ratcheting down of price back-end assembly of inter- flexible product – targeted at model to control costs, lower near space market, PV
structures that will cell connections to compete premium market segments SG&A and drive channel modules are uniquely
transform the industry as a low cost producer   Customizable and adaptable development. suited for applications
into a more competitive
  PV modules require less than manufacturing process   Announced Partnerships: requiring mobility,
marketplace.” 1% of the semiconductor   Norsk Hydro (BIPV) durability and lightweight.
Henning Wicht, senior
material to achieve same   Provo Craft (EIPV)
director PV systems power. Thus do not face the   FTL Solar (BIPV)
iSuppli Corp.
supply constraints and raw   TurtleEnergy (BIPV)
material costs that may affect   Energy Technologies (Defense)  
silicon-based manufacturers.

Investment Overview
Capital Structure
  Investment: Investors will acquire a 30% TRANSACTION $450,000,000
IRR 53%
interest in the target for $33.53m, based on $400,000,000
the VC IRR Method using an EBITDA Exit
multiple of 8.2x and Target IRR of 30%. Series A Convertible $350,000,000
30% $117,300,000
$168,872,871
Participating [Redeemable] $300,000,000

  Strengths: The Company already has a Preferred Shares $250,000,000

pipeline of backlog through several supply $200,000,000

major agreements. In addition, the Company $150,000,000
is jointly developing BIPV product solutions 70% $273,700,000
$100,000,000 !"!!!! $222,127,129
with a global building systems supplier. $50,000,000 $105,307,668

  Weaknesses: The Company has a limited $0

EQUITY - ENTRY (2010) EQUITY - PRE-EXIT PROCEEDS UPON EXIT
operating history and their business is based (2014) (2014) 3
on new and unproven technology COMMON - FOUNDERS & OPTION POOL PREFERRED - VC
 Company Overview
Business Overview Financial Overview
  Mission: D to be the first company to manufacture large,
The Company intends
Headquarters:
roll-format, PV modules in commercial quantities that use CIGS on a flexible,
Ascent Solar‎ Technologies, Inc. plastic substrate.
12300 Grant St   Technology: Their proprietary manufacturing process deposits multiple layers of
Thornton, Colorado 80241 materials, including a thin film of highly efficient copper-indium-gallium-
(720) 872-5000
ascentsolar.com‎
diselenide (CIGS) semiconductor material, on a flexible, lightweight, plastic
substrate and then laser patterns the layers to create interconnected PV cells, or
PV modules, in a process known as monolithic integration.
  Expansion: The Company intends to incrementally expand our aggregate
production capacity to 30 MW by attaining the following milestones within the
time frames indicated:
-  Second half of 2009: complete product certification with Underwriters Laboratory (UL) in
the U.S. and Technischer Überwachungs-Verein (TÜV) in Europe from 1.5 MW
production line.
-  Fourth quarter of 2009: begin qualification of production tools for the first 30 MW.
-  First half of 2010: begin production of the first half of initial 30 MW capacity.
-  Second half of 2010: commence ramp up to full 30 MW of rated capacity.

History

“ITN founded global solar in

1996 to manufacture flexible
CIGS thin-film technology using a
steel substrate. This experience led
to the development of Ascent
Solar's thin-film CIGS technology
on plastic substrates, the only
company producing thin-film on
flexible plastic today.”

4
 Products & Services
Product Offerings
 
D
BIPV Modules: BIPV, flexible solar modules modules laminate onto roofing, shading and building surfaces to decrease energy costs and provide a clean,
renewable source of energy.
  EIPV Modules: EIPV, flexible solar modules provide the flexibility necessary for easy integration to all types of materials including fabrics and plastic, specifically produced for
integrating solar power into electronic devices and consumer products. Applications include: cell phones, portable media devices and battery chargers.
  Defense Modules: Defense thin-film, flexible modules are specifically produced for creating solar-powered products that increase the efficiency of military operations.
Applications include: Tactical shelters, supplemental energy for conventional power systems and solar-powered communication devices, backpacks and battery chargers.

Advantages of CIGS on a Flexible Plastic Substrate

  CIGS versus a-Si: Although a-Si, like CIGS, can be deposited on a flexible
substrate, its conversion efficiency, which already is generally much lower than
that of CIGS, measurably degrades when it is exposed to ultraviolet light,
including natural sunlight. To mitigate such degradation, manufacturers of a-Si
solar cells are required to implement measures that add cost and complexity to
their manufacturing processes..
  CIGS versus CdTe: Although CdTe modules have achieved conversion
efficiencies that are generally comparable to CIGS in production, CdTe has
never been successfully applied to a flexible substrate on a commercial scale.
The use of CdTe on a rigid, transparent substrate, such as glass, makes CdTe
unsuitable for a number of the applications that the Company is targeting in the
BIPV and other markets. Also, CIGS can achieve higher conversion efficiencies
than CdTe.

Product Development Strategy

  The technology is an enabling technology. The Company’s
product development strategy is to work with potential
customers who are developing various products and
applications for BIPV and EIPV markets.
  The Company works with potential customers on a product
development plan, because those products are not on the
market yet. The Company starts with a product development
plan, and currently they have between 8 and 9 potential customers with
a product development plan in place, which leads to an LOI, and
5
eventually a purchase order. 5
 Business Model
D
While focused on speed to market, the Company believes that quality and consistency of product will be paramount to their success in the marketplace. Consequently, the
path to commercialization is defined by a highly disciplined, staged progression based upon the achievement of key milestones and supported by over fourteen years of
concerted research and development activity by their scientists.

RESEARCH & DEVELOPMENT MANUFACTURING

SALES AND DISTRIBUTION

Leveraging
Partnerships to
Expand Sales

6
 Customers
Customers
D
Commercial Builders & Architects: BIPV (Roof Tiles, Building Facades) Government Military: Portable Power Packs

Consumer Electronics Manufacturers: EIPV for Consumer Electronics NASA, Satellite & Aerospace Companies: Satellite and HAA

Customer Value Proposition

ELECTRONIC INTEGRATED PV AEROSPACE & DEFENSE APPLICATIONS BUILDING INTEGRATED PV

VALUE PROPOSITION VALUE PROPOSITION VALUE PROPOSITION

!  High Power and voltages density; eliminates need
for expensive power conditioning devices
!  No Glass; more durable in drop tests
!  Solar cell phones rapidly growing market segment,
particularly in Asia
!  Custom products to suit specific customer needs
!  Lightweight with excellent power density enabling
portable and deployable integrated systems
!  Match existing battery recharging ecosystems
!  Expands troop capabilities with increased supply
line independence
!  No Glass; more durable in handling tests
!  Dual value as building component and electricity
generation surface
!  Qualifies for higher feed-in tariffs
!  Power density competes with crystalline modules
!  Lower barrier to entry for architects/builders
!  Demand for >100MWp of modules
7
7
 Market
Global Photovoltaic Market Share Global Photovoltaic Market Size
“The growth of DShare Forecast
Global PV Market
PV installations in   Several new   Solar photovoltaics
2010 will be led by growth markets (including modules,
a newly energized
German market,
will come into system components,
which recovered
play in 2010, and installation) will
from sluggish
the most grow from a $30.7
performance in the significant of billion industry in
first half of 2009 which are the 2009 to $98.9 billion
to achieve gradual United States, by 2019.
growth in the second Italy and
half—a trend China.
expected to continue Together, thee   In 2010, total solar
for the first six
three markets cell production is
months of this year.
iSuppli
will account for expected to reach
50% of the 12.1GW, or 25%
growth growth over 2009.
projected to
occur in 2010.

“The entry of large Global Solar Cell Production Thin-Film PV Market by Application
Korea based
companies' market   Thin films are set to overtake crystalline silicon   Installations on residential, commercial, and industrial buildings to
participation such technologies through lower costs per watt. By account for more than 50% the thin film photovoltaic market in
as Samsung 2019, the market for thin film technologies will 2010.
Electronics, LG already be in excess of US$42 billion.
Electronics and
LG Display would Solar Cell Technology Market Share
accelerate mass
production era for
thin film solar cell
applied with
various technology"
and anticipated
market expansion
for thin film solar
cell in near
future..”
Mark Jee, senior
analyst at Energy
research division,
Displaybank

8
8
 Competitive Landscape
Competition
“While silicon
based   Market for PV products is dominated by large manufacturers of crystalline silicon technology. In 2008, the five largest of these manufacturers were; Q-
manufacturers cells (Germany), Suntech Power Holdings Co., Ltd. (China), Sharp (Japan), Kyocera (Japan), and Motech Industries (Taiwan).
currently dominate
the market, thin-
  The landscape of thin-film manufacturers encompasses a broad mix of technology platforms at various stages of development, and consists of a large
film manufacturers and growing number of medium and small sized companies.
will begin to capture   The two largest thin-film PV manufacturers are First Solar, Inc. and Energy Conversion Devices, Inc. Competitors currently developing or selling
an increasingly
CIGS-based PV modules include AVANCIS GmbH & Co. KG, Global Solar Energy, Inc., HelioVolt Corporation, Honda Soltec Co. Ltd., MiaSolé,
larger share of the
market.. NanoSolar, Inc., Solyndra, SoloPower, Inc. and Würth Solar GmbH & Co.

Competitors

“Some established
crystalline silicon
manufacturers are
starting to pursue
thin film technologies,
either in conjunction
with their crystalline
efforts, or more
recently as a way to
diversify their
technology portfolios
and insulate
themselves from
silicon supply
shocks.”

9

“Flexibility is thought to be an
important attribute of BIPV
for architectural features because
the PV must bend and twist to
conform to the shapes of the
underlying building materials or
able to be fused together with
roofing membrane materials.”
“NORSK HYDRO ASA
(NYSE:NHY) is a Fortune
500 energy and aluminum
company with 30,000
employees in nearly 40
countries. Hydro is a a major
aluminum and building systems
supplier and a leader in the
development of renewable
energy sources”
Unique Selling Point
Strategic Differentiation
UNIQUE PRODUCT ATTRIBUTES
Ascent Solar’s approach to thin film holds the promise of relatively high efficiency combined with a thin, lightweight, flexible product that is both
low cost and monolithic, compared to discrete manufacturing processes. Furthermore, its technology does not use silicon, so it is immune to the
silicon shortages that strike the rest of the industry.
 “Monolithic” refers to the manufacture of the module as one unit rather than the PV material being cut into individual cells and then re-attached in
multiple steps.
 “Discrete” implies that cells have to be assembled into a module, which requires several extra steps, additional cost, and tends to leave more open
surface area on the module that is not generating electricity.
STRATEGIC PARTNERSHIP ACCESS TO BIPV MARKET
Norwegian aluminum giant, Norsk Hydro ASA, owns a 35% stake in Ascent Technologiess The two (2) companies are also in partnership to to
integrate Ascent's PV products into certain products manufactured by Norsk's building products division.
 A stake by a much larger, well-established company may help Ascent's credibility with suppliers and potential customers.
 Strategic relationships with other parties (ITOCHU and Icopal) could open low-cost distribution channels for its BIPV and EIPV applications.
 Strategic relationship with Norsk Hydro provides us with direct access to a potentially large customer base in the global BIPV market.
Unique Product Attributes Strategic Norsk Hydro Relationship Offers Direct
Access to Global BIPV Market
Highlights of Norsk Hydro investment in Ascent Solar
 Immediately explore joint development of BIPV product solutions
 Explore integration of building integrated PV (BIPV) into Norsk
Hydro existing product brands
 Future deployment of BIPV building solutions through Norsk Hydro
market channels
 Further develop PV integration opportunities across Norsk Hydro
Aluminum businesses
10
 Market Opportunity
Ascent Solar’s opportunities in the photovoltaic manufacturing market are driven by (1) thin-film solar cells displacing crystalline Si solar cells due to equal
conversion efficiency, cheaper cost and better adaptability to bespoke applications (2) strong federal incentives for solar implementation for residential, commercial
and utilities applications, and (3) the system cost of solar implementations reaching cost competitiveness with utilities.

Thin-Film Market Expansion

PV production capacity by technology
  Thin-film solar has the potential to reach conversion
efficiency of crystalline Si solar cells, which comprise
approximately 90% of the market, with the added benefit
of low cost production. Thin film products may be suited
for applications that traditional crystalline silicon modules
may not be able to serve, which presents an opportunity to Market
steal market share from crystalline producers. Share

Federal Tax Incentives

  The U.S. will get a big boost from economic subsidies as

part of the financial rescue package through an 8-year
extension of a 30 percent tax credit for solar-electric
investments and the elimination of a $2,000 federal tax
credit cap. Market Penetration from Grid Parity
  Due to economomic subsidies, the U.S. has a shot to
become the biggest market for photovoltaics and one of
the largest producers over the next few years.

Grid Parity
  By 2015, two-thirds of the U.S. will have achieved grid
parity, the point at which electricity generated from
photovoltaics is equal in cost or less expensive than grid
power.
  The consensus is that grid parity for PV solar panels will
be achieved when they can be manufactured for less than
US$1 per Watt of peak power, after which a huge boom
in the number of solar installations is likely to occur.

11
 Corporate Strategy
LOW COST PRODUCER
  Large format, roll-to-roll
manufacturing process and
proprietary monolithic integration
techniques allow the Company to
achieve a per watt manufacturing
cost lower than most of the
flexible, lightweight, thin-film
competitors.
  Thin-film PV modules require less
than 1% of the semiconductor
material to achieve the same power
output as a c-Si-based PV device.
Costly and Wasteful
Wafer Substrate Manufacturing
D
DIFFERENTIATION
  The choice of a flexible
plastic substrate material
further differentiates the
Company from other thin-
film PV manufacturers.
  For markets that place a high
premium on weight, like
rooftop, defense, space and
near space markets, the
Company’s materials provide
attractive increases in the
power and voltage-to-weight
ratios than do competing
flexible PV thin-film
technologies.
Streamlined and Flexible
Plastic Roll (substrate)
STRATEGIC PARTNERSHIPS NEW MARKETS
  The Company’s   In the space and near
marketing and space markets the
distribution strategy is to power producing
form strategic modules are uniquely
partnerships to support suited for applications
their partners’ requiring mobility,
development, testing and durability and
certification of new lightweight.
integrated PV products.   Entry into the space
This should enable them and near space
to identify. and cultivate markets is based upon
promising market strategic relationships
segments. By cooperating with large players in
with strategic partners in these application areas.
this way, the Company
hopes to create sufficient
and consistent demand
for their PV modules.
 Management
Name Title Background

Dr. Mohan Misra Founder and

& Chairman
Chairman
Dr. Farhad Moghadam President & CEO
Gary Gatchell CFO
Ashutosh Misra SVP of Corporate Development
Rafael Gutierez SVP of Sales & Marketing
Zane Rakes VP of Manufacturing
Dr. Joe Armstrong CTO

Joseph McGabe VP of Business Development

Management Bios
Mohan S. Misra, Ph.D. Dr. Misra is the founder and
Chief Executive Officer of ITN Energy Systems.
Before founding ITN in 1994, Dr. Misra spent 19 years
with Martin Marietta in the areas of material research,
development and manufacturing. While at Martin
Marietta, Dr. Misra worked first as manager of
Research and Technology, then led the company's
development of long-term technology strategies. Dr.
Misra has helped develop and implement several key
Founder & Chairman technologies for aerospace applications including thin-
President & CEO
film photovoltaic, smart materials, advanced
composites and lightweight structures. Dr. Misra holds
a Ph.D. in Metallurgical Engineering from the
Colorado School of Mines.
Farhad Moghadam has been the Chief Executive
Officer and President of Ascent Solar Technologies Inc.
since August 3, 2009. Dr. Moghadam has extensive senior
executive experience in global operations, business
development and commercialization of complex, state-of-
the-art technologies. Prior to Ascent Solar Dr. Moghadam
served as Senior Vice President and General Manager of
Thin Films Product Business Group and Foundation
Engineering of Applied Materials Inc. He is an inventor
of approximately 65 patents and has more than 120
technical papers published in various technical journals
and periodicals. He earned both his Masters and
Doctorate degrees in Materials Science and Engineering
from Stanford University in 1979 and 1981, respectively.

Ascent’s management team includes a strong technology team with both academic and industry experience developing thin film.
13
 Income Statement
Revenue
For the Years Ended December 31,
GROWTH DRIVERS
INCOME STATEMENTS (ACTUAL $DOLLARS) 2007 2008 2009 2010 2011 2012 2013 2014
ACTUAL ACTUAL ACTUAL PROJECTED PROJECTED PROJECTED PROJECTED PROJECTED
  MW Capacity Increase: The Company will increase revenue Revenues $ 1,002,674 $ 1,499,729 $ 1,464,346 $ 7,800,000 $ 34,965,000 $ 74,439,375 $ 142,778,144 $ 239,577,808
based on the expected ramp-up of the Fab2 facility from 30 MW Cost of Gods Sold - - - 5,655,000 24,475,500 50,618,775 97,089,138 162,912,909
Gross Profit $ 1,002,674 $ 1,499,729 $ 1,464,346 $ 2,145,000 $ 10,489,500 $ 23,820,600 $ 45,689,006 $ 76,664,898
in 2011 to 110 MW in 2013 and then a 75% MW increase in 2014,
due to significant expansion into the BIPV market through Norsk Operating Expenses
Research & Development $ 4,802,538 $ 8,762,055 $ 14,908,209 $ 11,181,157 $ 5,590,578 $ 6,699,544 $ 8,566,689 $ 11,978,890
Hydro’s supply channels and distribution networks (APPENDIX). Depreciation & Amortization 102,416 1,415,424 2,582,706 8,332,917 11,904,167 23,808,333 23,808,333 23,808,333
  Capacity Utilization: The Company’s increasing revenue will also G&A Expenses 4,024,035 5,558,322 5,711,860.00 6,283,046 6,911,351 6,699,544 11,422,252 16,770,447
Total Operating Expenses $ 8,928,989 $ 15,735,801 $ 23,202,775 $ 25,797,119 $ 24,406,096 $ 37,207,421 $ 43,797,273 $ 52,557,670
be generated from increasing market demand for thin-film
products in target markets as well as existing backlog from long- Operating Income $ (7,926,315) $(14,236,072) $ (21,738,429) $ (23,652,119) $ (13,916,596) $ (13,386,821) $ 1,891,733 $ 24,107,228
term supply agreements. We are forecasting a steady rise in plant Other Income/(Expense)
capacity utilization from 52% in 2010 to 85% in 2014. Interest expense $ (424) $ (3,438) $ - $ - $ - $ - $ - $ -
Interest income 1,423,320 2,145,370 531,697 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000
100% $300,000,000
5% Realized Gain/(Loss) on Investments - (32,103) 59,383 - - - - -
90% 10%
18% $250,000,000 Realized Gain/(Loss) on Forward Contracts - (322,430) (541,771) - - - - -
80% 37%
48% Unrealized Gain/(Loss) on Forward Contracts - (766,403) 766,403 - - - - -
70% 95% $200,000,000 Total Other Income/(Expense) $ 1,422,896 $ 1,020,996 $ 815,712 $ 1,000,000 $ 1,000,000 $ 1,000,000 $ 1,000,000 $ 1,000,000
60%
90%
Income Taxes* - - - - - - - -
50% $150,000,000 Net Income $ (6,503,419) $(13,215,076) $ (20,922,717) $ (22,652,119) $ (12,916,596) $ (12,386,821) $ 2,891,733 $ 25,107,228
40% 82%
30% 63% $100,000,000 EBITDA $(7,823,899) $(13,941,584) $ (18,871,708) $ (15,319,203) $ (2,012,429) $ 10,421,513 $ 25,700,066 $ 47,915,562
52%
20% $50,000,000
10% * The Company has approximately $50,000,000 in NOLS and will incur additional operating losses in 2010 to 2012, which will offset any taxable income between 2013 and 2014.
0% $-
2010 2011 2012 2013 2014
For the Years Ended December 31,
Capacity Available Utilization Revenues INCOME STATEMENTS (COMMON SIZE) 2007 2008 2009 2010 2011 2012 2013 2014
ACTUAL ACTUAL ACTUAL PROJECTED PROJECTED PROJECTED PROJECTED PROJECTED
Research & Development Revenues 100% 100% 100% 100% 100% 100% 100% 100%
COGS & Operating Expenses Cost of Gods Sold
Total Revenues
-
100%
-
100%
-
100%
73%
28%
70%
30%
68%
32%
68%
32%
68%
32%

PROFIT DRIVERS Operating Expenses

Research & Development 479% 584% 1018% 143% 16% 9% 6% 5%
  COGS: We have relied on forecasts from Solar Sector Cost Depretiation & Amortization Expense 10% 94% 176% 107% 34% 32% 17% 10%
G&A Expenses 401% 371% 390% 81% 20% 9% 8% 7%
Review to estimate the 2010 COGS based on the Average All-In- Total Operating Expenses 891% 1049% 1585% 331% 70% 50% 31% 22%
Cost ($/W) for PV modules. We have estimated COG for 2011 to Operating Income -791% -949% -1485% -303% -40% -18% 1% 10%
2014 to improve through economies of scale, process cost
Other Income/(Expense)
reductions and improved cell efficiency. (APPENDICES). Interest expense 0% 0% 0% 0% 0% 0% 0% 0%
Interest income 142% 143% 36% 13% 3% 1% 1% 0%
  Operating Expenses: According to industry estimates, recurring Realized Gain/(Loss) on Investments 0% -2% 4% 0% 0% 0% 0% 0%
operating expenses account for 10-20% of revenue. SG&A costs Realized Gain/(Loss) on Forward Contracts
Unrealized Gain/(Loss) on Forward Contracts
0%
0%
-21%
-51%
-37%
52%
0%
0%
0%
0%
0%
0%
0%
0%
0%
0%
are typically around 5-15% of revenue and R&D costs around Total Other Income/(Expense) 142% 68% 56% 13% 3% 1% 1% 0%
5-6%. We have estimated 2010-2011 based on company guidance, Net Income -649% -881% -1429% -290% -37% -17% 2% 10%
as stated in the FYE 2010 Annual Report and smoothed
EBITDA -780% -930% -1289% -196% -6% 14% 18% 20%
2012-2014 to gradually decline to a long-term run rate of 22%.
14
 Balance Sheet

  PP&E: Property and

equipment are recorded
at the original cost to the
Company. Assets are
being depreciated over
estimated useful lives of
three to ten years using
the straight-line method,
commencing when the
asset is placed in service.

  Stockholder’s Equity:
The Company’s issued
capital stock consists of
95,000,000 shares of
common stock at
$0.0001 par value. Each
share of common stock
has the right to one vote.
Management has stock
options totaling
5,000,000 shares.

15
Cash Flow Statement

16
 Valuation
Valuation Investment Strategy
Comparative Valuation of Exit Value   Opportunity- The Company already has a pipeline of
Based on the EBITDA Guideline Companies Trina Solar Ltd. Suntech Power Holdings Co. Ltd. First Solar, Inc. Average Min
multiples and Sales TEV/EBITDA 8.2x 11.6x 12.7x 10.8x 8.2x backlog through several supply agreements to deliver
multiples from Pure-Play TEV/Sales 1.6x 1.7x 3.7x 2.3x 1.64x 67MW+ of product in the next five (5) years. In
PV module manufacturers. addition, the Company will jointly develop BIPV
Guideline Company Approach TEV/EBITDA TEV/Sales

This model implies an Exit

Estimated Ongoing Earnings 2014 E $47,915,562 $239,577,808 product solutions with Norsk Hydro, a global building
Pricing Exit Multiples 8.2x 1.64x
Value at the end of the systems supplier. Coupled with a high industry growth
Implied Value ($MM) $390,668,414 $393,343,157
investment period. rate, the Company represents an attractive investment
Exit Valuation ROUNDED $391,000,000 opportunity arising from strong growth that an
TARGET IRR: 30% investment in additional production capacity will
Entry Valuation $105,307,668 generate.
Source: CAPITALIQ
VCC IRR Method   Basis for Investing- An investment in the Company
VALUATION SUMMARY PROCEEDS EXIT 2014
The target IRR is will fund their manufacturing expansion plan, which
Investor Ownership % 30% Enterprise Value $391,000,000
estimated to be 30%
resulting in a pre-money
Required IRR 30% Less: Net Debt - entails the design, installation, qualification, testing and
Entry Year 2010 Total Equity Value $391,000,000 operation of additional production tools to increase
valuation of
Exit Year 2014 Less: Total Preference (63,184,601)
$73,715,368. This
Shares Outstanding Pre-investment 120,918,984 Less: Total Accrued Dividends (10,490,929)
their rated production capacity.
implies an EV/Revenue
Shares Outstanding Post-investment 172,741,406 Less: Participation (95,197,341)
(2010) of 13.5x.
Investors are paying for
Exit Multiple (EBITDA) 8.2x Equity Value to Common $222,127,129   Form of Investment - The investment consists of
Implied Entry Multiple (Revenue 2010E) 13.5x Series A Convertible Participating [Redeemable]
future revenue growth, Pre-Money Valuation $73,715,368 VC Preference $63,184,601
based on backlog from
Investment Tranches: VC Accrued Divends 10,490,929
Preferred Shares.
long-term supply Tranche 1: $10,530,767 VC Participating 95,197,341
contractual agreements
beginning in 2010.
Tranche 2: 10,530,767 Total Proceeds to VC $168,872,871   Valuation - The comparable valuation method was used
Tranche3: 10,530,767 to determine the Exit value of the Company in 2014.
Total Investment $31,592,300 Realized IRR 53%
Post-Money Valuation $105,307,668 Cash-on-Cash (CoC) 5.3x
There is no debt upon initiation of the transaction.
From the exit value, we applied the VC IRR method
Capital Structure and Transaction Proceeds with a 30% IRR to arrive at a Post-money valuation of
Upon exit, Founders Capital Structure
$105.3MM. Therefore, our 30% stake represents an
IRR 53%
and Management will $450,000,000
control 70% of the $400,000,000
initial investment of $31.6MM, resulting in a Pre-money
Company through $350,000,000 valuation of $73.7MM.
30% $117,300,000
common stock and $300,000,000 $168,872,871
management options. $250,000,000   Financial Returns - Based on our valuation and
The investors 30%
equity is comprised
$200,000,000
financial structuring, we expect an annualized return of
solely of convertible
$150,000,000
!"!!!!
70% $273,700,000
$222,127,129
53% upon exit at a base case Exit multiple of 8.2x
$100,000,000
participating EBITDA.
$50,000,000 $105,307,668
[redeemable] preferred
$0
shares
EQUITY - ENTRY (2010) EQUITY - PRE-EXIT
(2014)
PROCEEDS UPON EXIT
(2014)
  Exit Strategy- Investors will exit through an IPO or
COMMON - FOUNDERS & OPTION POOL PREFERRED - VC
Trade Sale at the end of a 5-year period.
17
 Sensitivity Analysis (IRR)
Risk Factors
The Company has a limited operating history and their business is based on new and unproven technology; therefore, an investment in the business is subject to
considerable risk. The ability to achieve their business, commercialization and expansion objectives will depend on a number of factors, including:

  The company can successfully begin commercial production on the equipment installed in FAB2;
  Failure to consummate strategic relationships with their key partners in various target market segments;
  Failure to further refine their technology and develop and introduce improved PV products could render their PV modules uncompetitive or obsolete; and
  Government regulations and policies may present technical, regulatory and economic barriers to the purchase and use of PV products

Therefore, we have considered any IRR below the Target IRR of 30% unsatisfactory.

Key Sensitivity Drivers Sensitivity Analysis

EXIT MULTIPLE IMPLIED IRR
  An exit multiple of 8.2x and a required IRR of 30% EBITDA Margin (2014E)
were used to the value of the firm at entry. Due to
risk inherent in the business cycle we have EXIT 10% 13% 17% 20% 23% 27% 30%
performed a sensitivity analysis with a range of +/- 4.1x 27.7% 31.3% 34.7% 37.7% 40.6% 43.3% 45.8%
50%. 5.4x 31.3% 35.8% 39.7% 43.3% 46.6% 49.7% 52.6%
6.8x 34.7% 39.7% 44.1% 48.2% 51.9% 55.3% 58.4%
REVENUE GROWTH 8.2x 37.7% 43.3% 48.2% 52.6% 56.6% 60.3% 63.7%
  According to our analysis and guidance from the 9.5x 40.6% 46.6% 51.9% 56.6% 60.9% 64.7% 68.3%
Company, 2014 will entail significant revenue growth 10.9x 43.3% 49.7% 55.3% 60.3% 64.7% 68.8% 72.6%
and will be the year of our exit. Revenue growth 12.2x 45.8% 52.6% 58.4% 63.7% 68.3% 72.6% 76.5%
rates will contribute to the valuation of the Company
upon exit; therefore, we have performed a sensitivity
Gross Margin (2014E)
analysis with a range of +/- 50%.
Revenue Growth (2014E)

EBITDA MARGIN & GROSS MARGIN 16% 21% 27% 32% 37% 43% 48%
EXIT MULTIPLE 0% 11.2% 29.0% 35.5% 41.1% 46.0% 50.4% 54.4%
  We have chosen to perform a a sensitivity analysis 8.2 x 23% 16.9% 31.6% 39.0% 45.2% 50.7% 55.5% 59.9%
with a range of +/- 50% on key two (2) key margins 45% 22.2% 34.2% 42.3% 49.1% 54.9% 60.1% 64.7%
that will affect the EBITDA in the terminal year: 68% 25.3% 36.5% 45.3% 52.6% 58.8% 64.3% 69.2%
EBITDA margin and Gross Margin. Gross Margin 90% 26.6% 38.8% 48.2% 55.8% 62.4% 68.2% 73.3%
provides an indicator of how well the company is 113% 27.8% 40.9% 50.9% 58.9% 65.7% 71.7% 77.0%
managing the manufacturing process, while EBITDA 136% 29.1% 43.0% 53.3% 61.8% 68.8% 75.0% 80.5%
margin includes this affect plus the cost of overhead.

18
 Sources & Uses
Overview - Uses of Funds

  Expansion: Ascent Solar is in the expansion stage and is seeking a infusion of growth
capital investment to finance a manufacturing expansion plan, which entails the design,
installation, qualification, testing and operation of additional production tools to
increase their rated production capacity.

  Capacity Expansion: The Company’s current plan is to bring on

Short line approximately 6 to 8 MW of capacity in FAB2 in 2010.
Term Initially, they expect that non-BIPV markets will constitute the
Strategy majority of our product shipments in 2010.

  Product Expansion: In order for market entry into the BIPV

Long market the Company needs additional capacity in anticipation of
Term joint development of BIPV product solutions with Norsk Hydro.
Strategy The expansion in production capacity offers the company an
opportunity to integrate their building integrated PV (BIPV) into
Norsk Hydro’s existing product and offers a low-cost distribution
channels and potentially large, global customer base.

Sources and Uses Table

Sources ($MM) Uses ($MM)

Series A Preferred Shares 31,592,300.42 Acquisition of New Manufacturing Equipment $30,012,685
Installation of New Equipment $1,184,711
Testing $394,904
TOTAL: $31,592,300 TOTAL: $31,592,300

19
 SWOT Analysis
Strengths
  Streamlined manufacturing approach.: Ascent’s
manufacturing process avoids some duplicative steps required in
other processes, performing the necessary scribes in one
manufacturing process, whereas others may have to scribe in
multiple steps.
  Cost-advantages over competitors: While many thin film
solutions promise low cost structures, few demonstrate the right
set of attributes to make them well-suited to be integrated into
building products (thin, lightweight, flexible, and monolithic) or
electronics (high voltages in small cells, easily customizable).
  Ability to easily enter new markets: They can manufacture
PV modules to enter different markets and develop customized
applications without altering their production processes.
Opportunities
  Thin-film market expansion: Thin-film solar has the
potential to reach conversion efficiency of crystalline Si solar
cells, which comprise approximately 90% of the market, with
the added benefit of low cost production.
  Economic subsidies: Due to economomic subsidies, the U.S.
has a shot to become the biggest market for photovoltaics and
one of the largest producers over the next few years.
  Critical mass at grid parity: The consensus is that grid parity
for PV solar panels will be achieved when they can be
manufactured for less than US$1 per Watt of peak power, after
which a huge boom in the number of solar installations is likely
to occur.
Weaknesses
  Early stage: The Company has a limited history of
operations, have not generated any revenue from operations
and have had limited production of our PV modules.
  Additional capital requirements: The Company’s planned
capacity expansion will require additional capital which they
may not be able to obtain on favorable terms, if at all or
without dilution to current stockholders.
  Development/scale-up risk: CIGS has proven notoriously
difficult to work with, which could lead to delays in scaling
manufacturing operations
  Subject to similar risks as those of other PV
manufacturers: such as management ability, capital access,
and economical access to raw materials, among others.
Threats
  Competition: Other CIGS companies have constructed
pilot and early stage commercial plants or are expected to do
so in the coming one to two years
  Technology risk: Other solar and PV solutions are being
pursued that, if successful, could make Ascent’s approach to
the space (and those of other players) uneconomical or
relatively less attractive.
  Government Regulation: Existing government regulations
and policies and changes to these regulations and policies
may present technical, regulatory and economic barriers to
the purchase and use of PV products, which may
significantly reduce the demand for PV modules.
20
 Basic Terms
Financial Structuring
  Pre-Money Valuation: $73,715,368
  Desired Ownership: 30%
  Stage: Growth Capital
  Industry: Clean Technology
  Investment Duration: 5 years
  Type of Structure: Staged Capital Commitment – 3 Tranches
at a price of $.6096/share for 17,274,141/Tranche. Tranche 1 is
due immediately, Tranche 2 will be invested FYE 2010 and
Tranche 3 FYE 2012 upon achieving of the minimum Revenue
Projections (Appendix).
  Financial Instrument: Series A Convertible Participating
[Redeemable] Preferred Shares
  Expanded Share Option Pool: The expansion of the share
option pool [prior to the investment] to represent a 15% of the
equity post-funding on a fully diluted basis.
  Milestones: Management options will be fully vested upon
achieving an IRR of at least 30% upon Exit.
  Dividend: Cumulative 8% dividend of the original investment.
  Convertible: Converts 1:1 to Common Stock at any time at
option of holder.
  Redeemable: Redemption price equal to the original
investment [plus a rate of return equal to 10% per year on the
original investment] minus the amount of cumulative dividends.
  Liquidation Preference: Preference to the holders of the
Common Stock a per share amount equal to 2x the Original
Issue Price plus any declared but unpaid dividends (the
Liquidation Preference).
  Participation: Fully Participating
Legal Structuring
  Anti-dilution: Full Ratchet Anti-Dilution
  Right of First Refusal: In the event that the Company is
to offer additional equity securities, the Investors have the
right to purchase a pro-rata percentage of shares in the new
offering, based on the Investors percentage ownership
interest in the company.
  Tag-along Rights: Were the management to sell their own
shares; Investors have the right to participate in the sale, at
the same price and under the same terms and conditions.
  Drag-along Rights: If the Investors decide to sell a part or
all its shares, all other owners of the company are required to
sell the same percentage of its shares to the potential
purchaser.
  Board Structure: The Board will consist of 9 members.
The holders of the Preferred Stock designate 1 director. Mr.
Justin G. Roberts (MD) Dawn Treader Capital, LLC on the
Ascent Solar Board. The remaining 8 directors will be
elected by the Common Stock and the Preferred Stock
voting as a single class.
  Veto Rights: The Investors will hold veto rights on the
following decisions (i) Appointing new directors (ii) issuing
additional share capital (iii) Transferring shares (iv) Incurring
new debt (v) Establishing new subsidiaries (vi) Changes in
Company statutes (vii) liquidity events
  Voting Rights: The Series A Preferred Stock shall vote
together with the Common Stock on an as-converted basis,
and not as a separate class
  Exit Rights: Investors will exit through IPO or Trade Sale
21
Appendices

22
 Indicative Term Sheet – Dawn Treader Capital, LLC

This summary of terms and conditions is preliminary and subject to change. Furthermore, this summary of terms and
conditions is not intended to define or describe all of the terms and conditions of the proposed transaction described
herein. The parties recognize that neither party shall have any liability or obligation to the other as a result of this
summary of terms and conditions, it being understood that only such provisions as shall be set forth in the final
documents shall have any legal effect. Each party acknowledges that certain information provided in connection with the
transaction is confidential. Each party agrees that it will not disclose such information to any other party except as
required for the completion of the transaction described herein or as required by law, regulatory requirements, a court
order or discovery procedures.

We are pleased to announce our proposal for an investment in Ascent Solar, Inc. (the “Company”)

1. Investment

1.1 Investors: Dawn Treader Capital, LLC (the “Investors”)

1.2 Investment Form: Convertible Participating [Redeemable] Preferred Shares (“Preferred

Shares”) at a price of $0.6096 per Preferred Share (the “Original
Issue Price”) for 51,822,422 Preferred Shares for a total investment
of $31,592,300.

1.3 Ownership Percentage: The investment will represent a 30% shareholding for the Investors
on a fully diluted basis following an expansion of the option pool,
detailed in paragraph 1.6.

1.4 Pre-Money Valuation: The investment will be made at a fully diluted pre-money valuation
of $73,715,368, including employee share options equal to 21.4% of
the fully diluted equity. Current Capitalization is set out in Appendix
1 and Capitalization Post-Funding is set out in Appendix 2.

1.5 Staged Investment The investment will be staged with (1/3) at completion (the “First
Tranche”), (1/3) invested (the “Second Trance”) FYE 2010 and
(1/3) invested (the “Third Tranche”) FYE 2012, upon completion of
certain Milestones detailed in paragraph 1.8.

1.6 Option Pool The expansion of the share option pool [prior to the investment] to
represent a 21.4% of the equity pre-funding on a fully diluted
basis/or 15% post-funding on a fully diluted basis. Options are
reserved for managers and are exercisable at the Original Issue Price.

1.7 Management Options 50% of the stock options will accrue to the managers upon achieving
the minimum Target IRR of 30% upon Exit and 100% will accrue
upon achieving an IRR greater than 50% upon on Exit.

1.8 Milestones Investments will be made at each Tranche upon completion of

minimum revenues set forth in the “Projections” (See Appendix 3).

1.9 Use of Funds: The use of funds will be for the 1st Fab2 expansion. The proceeds
will be used to purchase manufacturing and development equipment,
as well as installation and testing of said equipment.

2. Investment Conditions

2. 1 Review The investment will only take place after satisfactory completion of
the following due diligence:
• Conclusion of our commercial due diligence

2. 2 Dividends:
2.3 Optional Conversion
2.4 Liquidation Preference:
2.5 Participation
2.6 Redemption Rights:
2.7 Anti-Dilution Protection:
2.8 Exit Rights:
2.9 Right of First Refusal:
2.10 Tag-along Rights:
2.11 Drag-along rights:
2.12 Board Structure:
• Market, technology review and legal review by an
independent third party.
• References from customers, partners and management.
The investors will receive a cumulative dividend of 8% [compounded
annually] of the Original Issue Price. The Company will be
prevented from paying any dividends to other shareholders until the
dividend is paid to the Preferred Shares on Exit or redemption.
The Series A Preferred initially converts 1:1 to Common Stock at any
time at option of holder, subject to adjustments for stock dividends,
splits, combinations and similar events.
In the event of any liquidation or winding up of the company the
Preferred Shares shall be entitled to receive in preference to the
holders of the Common Stock a per share amount equal to 2x the
Original Issue Price plus any accrued dividends.
After the payment of the Liquidation Preference to the holders of the
Preferred Shares, the remaining assets shall be distributed pro-rata to the
holders of the Common Stock and the Preferred Shares on an as-
converted basis.
At election of the Investors, the Company may redeem Preferred Shares
at a redemption price equal to the Original Issue Price [plus a rate of
return equal to 10% per year on the Original Issue Price] minus the
amount of cumulative dividends owed to Preferred Shares.
The Investors will maintain the right to full percentage ownership at
the same level throughout the duration of the investment, and
subsequent to future rounds of financing – full ratchet protection.
Investors will exit through an IPO or Trade Sale at the end of a 5
year period or choose to redeem their shares.
In the event that the Company is to offer additional equity securities,
the Investors have the right to purchase a pro-rata percentage of
shares in the new offering, based on the Investors percentage
ownership interest in the company.
Were the management to sell their own shares; Investors have the
right to participate in the sale, at the same price and under the same
terms and conditions.
If the Investors decide to sell a part or all its shares, all other owners
of the company are required to sell the same percentage of its shares
to the potential purchaser.
The Board will consist of 9 members. The holders of the Preferred
Stock designate 1 director. Mr. Justin G. Roberts (MD) Dawn
Treader Capital, LLC on the Ascent Solar Board. The remaining 8
directors will be elected by the Common Stock and the Preferred
Stock voting as a single class.
2.13 Information Rights: For the duration of the sponsors investment, the Management will
deliver the company’s monthly actual vs. plan and prior year. The
company will also produce and distribute a comparison of the year’s
annual budget 60 days before the beginning of the fiscal year,
including direct access to the company’s auditors and bankers.

2.14 Voting Rights: Preferred shares have equivalent voting rights to ordinary shares in a
general meeting.

2.15 Veto Rights: The Investors hold veto rights on the following (i) Appointing new
directors (ii) Issuing additional share capital (iii) Transferring shares
(iv) Incurring new debt (v) Establishing new subsidiaries (vi) Changes
in Company statutes (vii) liquidity events

2.16 Expiration Date: The acceptance or rejection of the above terms no later than 14
days after receipt.

3. Good Leaver/Bad Leaver Provisions

3.1 Good Leaver/Bad Leaver: In the event of an employee shareholder [{other than a Founder}]
leaving the Company within 5 years of the commencement of
employment all the shares must be offered for sale:

(i) For a Bad Leaver, at the lower of market value and the
nominal value of the shares
ii) For a Good Leaver, at the market value of the shares

4. Law

4.1 Governing Law: This term sheet is governed by United States Law.

5. Confidentiality and Disclosure

5.1 Exclusivity: In lieu of the expenditure in time and professional fees invested by
the Investors in progressing this offer, the Company agrees and
undertakes an obligation to not solicit, directly or indirectly, further
offers of purchase of shares in the Company with any other party.

5.2 Restrictive Covenants: Each officer and key employee of the Company designated by the
Investors will enter into a non-competition, proprietary information
and inventions agreement in a form acceptable to the Investors

5.3 Monitoring: The Investors will be reimbursed for fees by the company to cover
internal and external costs incurred in connection with the
investment process.

5.4 Indemnity: The Company will certify that there are no outstanding
obligations of which the Investors are not aware.
TO: Ascent Solar, Inc.

………………………………………………………….. date ………........

Signed by Justin Roberts, on behalf of Dawn Treader, LLC

……………………………………………… date ……….......

[Founder]
 Appendix 1

Pre-money Capitalization Table

Pre-Option Pool Expansion:

Capitalization Table Preferred Common Shares Options Total Shares Fully Diluted
Pre-money Shares Granted %
Outstanding
Founders 95,000,000 95,000,000 95%
Dawn Treader Capital , LLC
Option Pool 5,000,000 5,000,000 5%
Total Shares Oustanding 95,000,000 5,000,000 100,000,000 100%

Post-Option Pool Expansion:

Capitalization Table Preferred Common Shares Options Total Shares Fully Diluted
Pre-money Shares Granted %
Outstanding
Founders 95,000,000 95,000,000 79%
Dawn Treader Capital , LLC
Option Pool 25,918,984 25,918,984 21%
Total Shares Oustanding 95,000,000 25,918,984 120,918,984 100%
 Appendix 2

Post-money Capitalization Table

Capitalization Table Preferred Common Shares Options Total Shares Fully Diluted
Post-money Shares Granted %
Outstanding
Founders 95,000,000 95,000,000 55%
Dawn Treader Capital , LLC 51,822,422 51,822,422 30%
Option Pool 25,918,984 25,918,984 15%
Total Shares Oustanding 51,822,422 95,000,000 25,918,984 172,741,406 100%

Price per Share $ 0.6096 Total Preferred Shares 51,822,422 Pre-money Valuation $ 73,715,368
Total Invested $ 31,592,300 Preferred Ownership 30% Post-money Valuation $ 105,307,668
 Appendix 3

Projections

For the Years Ended December 31,

INCOME STATEMENTS (ACTUAL $DOLLARS) 2007 2008 2009 2010 2011 2012 2013 2014
ACTUAL ACTUAL ACTUAL PROJECTED PROJECTED PROJECTED PROJECTED PROJECTED
Revenues $ 1,002,674 $ 1,499,729 $ 1,464,346 $ 7,800,000 $ 34,965,000 $ 74,439,375 $ 142,778,144 $ 239,577,808
Cost of Gods Sold - - - 5,655,000 24,475,500 50,618,775 97,089,138 162,912,909
Gross Profit $ 1,002,674 $ 1,499,729 $ 1,464,346 $ 2,145,000 $ 10,489,500 $ 23,820,600 $ 45,689,006 $ 76,664,898

Operating Expenses
Research & Development $ 4,802,538 $ 8,762,055 $ 14,908,209 $ 11,181,157 $ 5,590,578 $ 6,699,544 $ 8,566,689 $ 11,978,890
Depreciation & Amortization 102,416 1,415,424 2,582,706 8,332,917 11,904,167 23,808,333 23,808,333 23,808,333
G&A Expenses 4,024,035 5,558,322 5,711,860.00 6,283,046 6,911,351 6,699,544 11,422,252 16,770,447
Total Operating Expenses $ 8,928,989 $ 15,735,801 $ 23,202,775 $ 25,797,119 $ 24,406,096 $ 37,207,421 $ 43,797,273 $ 52,557,670

Operating Income $ (7,926,315) $(14,236,072) $ (21,738,429) $ (23,652,119) $ (13,916,596) $ (13,386,821) $ 1,891,733 $ 24,107,228

Other Income/(Expense)
Interest expense $ (424) $ (3,438) $ - $ - $ - $ - $ - $ -
Interest income 1,423,320 2,145,370 531,697 1,000,000 1,000,000 1,000,000 1,000,000 1,000,000
Realized Gain/(Loss) on Investments - (32,103) 59,383 - - - - -
Realized Gain/(Loss) on Forward Contracts - (322,430) (541,771) - - - - -
Unrealized Gain/(Loss) on Forward Contracts - (766,403) 766,403 - - - - -
Total Other Income/(Expense) $ 1,422,896 $ 1,020,996 $ 815,712 $ 1,000,000 $ 1,000,000 $ 1,000,000 $ 1,000,000 $ 1,000,000
Income Taxes* - - - - - - - -
Net Income $ (6,503,419) $(13,215,076) $ (20,922,717) $ (22,652,119) $ (12,916,596) $ (12,386,821) $ 2,891,733 $ 25,107,228

EBITDA $(7,823,899) $(13,941,584) $ (18,871,708) $ (15,319,203) $ (2,012,429) $ 10,421,513 $ 25,700,066 $ 47,915,562

* The Company has approximately $50,000,000 in NOLS and will incur additional operating losses in 2010 to 2012, which will offset any taxable income between 2013 and 2014.
 Projection Assumptions
Revenue
ASSUMPTIONS
  MW Capacity Increase: based on the guidance from the company
from the expected ramp-up of the Fab2 facility to 2013 and then an
increase of 100% in 2014, based on significant expansion into the
BIPV market through Norsk Hydro’s supply channels and distribution
networks.
  Factory Gate Price: based on the guidance from Daniel Tomlinson,
Senior Associate of Business Development at Ascent Solar, “Thin
film modules for factory gate prices for 2009/2010 are expected to be
priced from $1.90 to $2.20. “ Based on industry data from IMS
Research, I have chosen $2.00 as the 2010 starting price and included
a price decay of 7.5% per year to account for process cost reductions and
improved cell efficiency.
  Capacity Utilization: IC Insights is forecasting a steady rise in plant
capacity utilization from 52% in 2010 to 63% in 2011 and to 82% in
2013. We have relied on these estimates as it reflects the economic
realities of the mismatch between photovoltaic capacity expansions
and slumping market demand that occurred in 2007 to 2009 in the
industry. A strengthening global economy should bring supply in line
with demand.

COGS & Operating Expenses

ASSUMPTIONS
  COGS: We have relied on forecasts from Photon Consulting: Solar
Sector Cost Review to estimate the 2010 COGS based on the Average
All-In-Cost ($/W). COGS decrease from $1.45 in 2010 to $1.00 in
2014.
  Operating Expenses: According to industry estimates, recurring
operating expenses account for 10-20% of revenue. SG&A costs are
typically around 5-15% of revenue and R&D costs around 5-6%. We
have estimated 2010-2011 based on company guidance, as stated in
the FYE 2010 Annual Report and smoothed 2012-2014 to gradually
decline to 22% by 2014, slightly above the industry average.

23
 Sources
  Capacity Utilization:
“With PV manufacturers unable to abruptly curb additions to production plants, capacity utilization rates for solar devices are forecast to
plummet from 83% in 2008 to 54% in 2009 and to 52% in 2010. However, the report is forecasting a steady rise in plant capacity utilization
to 63% in 2011 and to 82% in 2013. The efforts to achieve high levels of capacity utilization will stretch out to the end of the forecast
period and will be an important contributor to the industry's reduction of the cost per watt of solar systems.”
http://www.1888pressrelease.com/solar-pv-capex-cuts-will-ease-capacity-growth-in-time-for-re-pr-127711.html

  Cost $/Watt:

http://www.pvgroup.org/AboutPVGroup/ctr_029584;
http://www.pv-tech.org/news/_a photon_consulting_picks_low_cost_solar_survivors/

Thin-Film Price:
Daniel Tomlinson - Senior Associate of Business Development at Ascent Solar

Low quality supply from China $1.80 to $2.20 (FOB)

Thin Film modules factory gate from $1.90 to $2.20
Px factory gate $2.40 to $2.80
Cz factory gate $2.60 to $3.00

http://www.renewable-energy-sources.com/2009/03/14/pv-panels-price-forecast-for-2009/ 24
 Sources (cont.)
  PV Module Price:

$2.00

~7.5% decrease/yr

http://www.solarfeeds.com/ims-research/10726-2009-pv-module-market--installations-and-shipments-up-revenues-down

  Gross Margin:

http://www.solarfeeds.com/ims-research/10203-quantifying-and-analyzing-pv-industry-q309-results 25
 Sources (cont.)
  Operating Expenses:

One of the main reasons mid-size vendors have remained economically viable against multinational suppliers like Kyocera (KYO),
Sharp, and BP is that R&D requirements for photovoltaics are extremely low once the product is released, with much of the
remaining investment going to incremental efficiency increases. First Solar (FSLR), Suntech (STP), and Sunpower (SPWRA) all have
R&D/revenue ratios under 6%. The relatively low research requirements following a product launch prevent larger firms from
gaining big advantages through larger budgets, and more importantly, leave little room to cut R&D costs by merging two suppliers
together.

In addition to low R&D costs, solar suppliers' have very low SG&A costs, typically around 5-15% of revenue. So while the top
third of a solar company's income statement can make some investors wary, the middle third is usually very pleasing, especially in
comparison to IT companies, who can cut much more overhead through mergers and acquisitions.

With recurring operating expenses a very low 10-20% of revenue, there are few costs to cut by merging solar suppliers. Moreover,
manufacturing efficiencies are hard to obtain by combining different materials or production processes, many of which are
proprietary. Therefore, to reduce manufacturing overhead, a typical solar manufacturer has to get larger, but will not see much
benefit from merging with a supplier that uses a different technology.

Most solar manufacturers have extremely low recurring

operating costs, with total R&D and SG&A costs under
20% of revenue. Suntech (STP), for example, reports total
SG&As and R&D at under 10% of revenue, while
Sunpower (SPWRA, Evergreen Solar (ESLR), and First
Solar are right around 15%.

http://70.32.84.178/freesky-research/10975-low-operating-costs-preventing-pv-supplier-mergers
http://70.32.84.178/freesky-research/10842-pv-profitability-its-all-about-the-manufacturing-overhead-costs 26
Competitive Industry Structure

27