A123 Systems and Wanxiang Group Corporation Execute Definitive Agreements for Wanxiang's Strategic Investment in A123
16 Août 2012 - 3:33PM
A123 Systems (Nasdaq:AONE), a developer and manufacturer of
advanced Nanophosphate® lithium iron phosphate batteries and
systems, today announced the execution of definitive agreements
with Wanxiang Group Corporation, which follows the non-binding
memorandum of understanding (MOU) that A123 signed with Wanxiang on
August 8, 2012. Wanxiang is China's largest automotive components
manufacturer and one of China's largest non-government-owned
companies. Under the terms of the agreements, Wanxiang plans to
invest up to $465 million in A123, which includes an initial credit
extension of $25 million that A123 expects to receive this week.
The full investment from Wanxiang is expected to provide A123 with
the capital necessary to strengthen the company's competitive
position in the global vehicle electrification and grid energy
storage markets.
"We consider today's announcement to be a strong validation of
A123's technology and the company's ability to compete in
high-growth markets," said David Vieau, CEO of A123. "We believe
that the significant commitment of capital from Wanxiang would help
strengthen A123's financial position, and by leveraging Wanxiang's
global capabilities, we expect to see increased demand for our
products. Further, Wanxiang has demonstrated its commitment to
partnering with and investing in U.S. companies, so we also believe
that we will continue to expand on our strong manufacturing and
systems engineering capabilities in Michigan and
Massachusetts."
Pursuant to the terms of the definitive agreements, Wanxiang
would provide A123 with up to $75 million in initial debt financing
under a Senior Secured Bridge Facility. In addition to the initial
credit extension of $25 million, $50 million would be funded after
the satisfaction of certain closing conditions. Subsequently, upon
satisfaction of certain closing conditions, Wanxiang would purchase
$200 million aggregate principal amount of A123's 8.00% Senior
Secured Convertible Notes. The agreements also include the
potential for Wanxiang to invest up to an additional $190 million
by exercising the warrants that will be issued in connection with
the Bridge Facility and the 8.00% Convertible Notes for cash.
Incurrence of the remaining $50 million of loans under the Senior
Secured Bridge Facility is subject to the satisfaction of certain
approvals and conditions, including receipt of favorable
determination from the Committee on Foreign Investment in the
United States and receipt of Chinese government approvals. Issuance
of the 8.00% Convertible Notes and the related warrants are also
subject to additional conditions, including approval from A123's
shareholders, termination of the Hart-Scott-Rodino waiting period,
the conversion or redemption of all the outstanding 6.00% Senior
Convertible Notes due 2013 and related warrants and the repurchase
or retirement of at least 90 percent of A123's outstanding 3.75%
Convertible Subordinated Notes due 2016.
If the entire amount of the initial debt financing is provided
to A123, the 8.00% Convertible Notes are issued and the full amount
of the warrants are exercised for cash, Wanxiang's total capital
investment in A123 from these agreements would total approximately
$465 million. The total amount of shares of A123's common stock
issuable upon exercise and conversion of the warrants and 8.00%
Convertible Notes would represent approximately 80 percent of the
fully diluted common stock of A123 outstanding at that time.
This press release shall not constitute an offer to sell nor a
solicitation of an offer to buy any of these securities, nor shall
there be any offer, solicitation or sale of these securities in any
state in which such offer, solicitation or sale would be unlawful
prior to the registration or qualification under the securities
laws of any such state.
Lazard served as financial advisor to A123 for the
above-described transactions.
About A123 Systems
A123 Systems, Inc. (Nasdaq:AONE) is a leading developer and
manufacturer of advanced lithium-ion batteries and energy storage
systems for transportation, electric grid and commercial
applications. The company's proprietary Nanophosphate® lithium iron
phosphate technology is built on novel nanoscale materials
initially developed at the Massachusetts Institute of Technology
and is designed to deliver high power and energy density, increased
safety and extended life. A123 leverages breakthrough technology,
high-quality manufacturing and expert systems integration
capabilities to deliver innovative solutions that enable customers
to bring next-generation products to market. For additional
information please visit www.a123systems.com.
The A123 Systems, Inc. logo is available at
http://www.globenewswire.com/newsroom/prs/?pkgid=6600
Safe Harbor Disclosure
This press release includes forward-looking statements within
the meaning of Section 27A of the Securities Act of 1933, as
amended, and Section 21E of the Securities Exchange Act of 1934, as
amended that are subject to risks, uncertainties and other
important factors, including statements with respect to the
expected benefits of Wanxiang's strategic investment in A123, the
expansion of A123's domestic and global capabilities and its
potential to create long-term value for A123's and Wanxiang's
customers, investors and other stakeholders, the satisfaction of
conditions to closing of the financings and the closing of these
financings. Among the factors that could cause actual results to
differ materially from those indicated by such forward-looking
statements are: failure to obtain required stockholder and U.S. and
Chinese government approvals, delays in the development of A123's
products, delays in the scale-up, revalidation and increased
efficiency of A123's manufacturing capacity, delays in A123's
production ramp, adverse economic conditions in general and adverse
economic conditions specifically affecting the markets in which
A123 and Wanxiang operate, and other risks detailed in A123
Systems' quarterly report on Form 10-Q for the quarter ended June
30, 2012 and other publicly available filings with the Securities
and Exchange Commission. All forward-looking statements reflect
A123's expectations only as of the date of this release and should
not be relied upon as reflecting A123's views, expectations or
beliefs at any date subsequent to the date of this release.
CONTACT: A123 Systems PR Contact:
A123 Systems
Dan Borgasano
617-972-3471
dborgasano@a123systems.com
A123 Systems IR Contact:
ICR, LLC
Garo Toomajanian
617-972-3450
ir@a123systems.com
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