A123 Systems Receives Interim Court Approval Of $50 Million DIP Financing
WALTHAM, Mass., Nov. 6, 2012 /PRNewswire/ -- A123 Systems, Inc. (Nasdaq: AONE) ("A123" or "the Company"), a developer and manufacturer of advanced Nanophosphate® lithium iron phosphate batteries and systems, today announced that the United States Bankruptcy Court for the District of Delaware (the "Court") has granted A123 interim approval to use $50 million of Debtor-in-Possession ("DIP") financing, which is being provided by Wanxiang Group Corporation ("Wanxiang"). The financing supplements the pre-petition $22.5 million of liquidity and letter of credit support that Wanxiang provided to A123, which will remain in place.
The hearing on bidding procedures with regard to the previously announced asset purchase agreement with Johnson Controls, Inc. (NYSE: JCI) that was initiated on Monday, November 5, 2012, has been adjourned until a hearing scheduled for November 8, 2012. Johnson Controls consented to adjourn the hearing on this motion so A123 and Johnson Controls could continue discussions with the recently formed Official Committee of Unsecured Creditors and attempt to resolve consensually any potential issues regarding the bidding procedures.
"We are pleased that the Court has granted A123 interim approval for the DIP financing agreement," said Dave Vieau, Chief Executive Officer of A123. "The DIP financing will allow A123 to operate our businesses and provides additional operational and financial stability as we proceed with the transaction process. It is important to note that being the DIP provider does not give Wanxiang or any other party control over or leverage in A123's court-supervised sale process. As we move through the transaction process, we will continue to act in the best interests of A123, its employees and its other stakeholders."
Additional information is available on A123's website at www.a123systems.com or by calling A123's Restructuring Hotline, toll-free in the U.S., at 1-800-224-7654. For calls originating outside the U.S., please dial +1 973-509-3190.
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.
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 the Wanxiang DIP agreement and the proposed asset sales, the potential of the transactions to create value for A123 and its stakeholders, the satisfaction of conditions to closing of the transactions, and the necessity of bankruptcy court and other approvals, including antitrust and other regulatory approvals, to conduct and complete the financing and other potential asset sales. Among the factors that could cause actual results to differ materially from those indicated by such forward-looking statements are: failure to obtain required bankruptcy court and other approvals, failure to satisfy the conditions to closing of the transactions, delays in the development of A123's products, adverse economic conditions in general and adverse economic conditions specifically affecting the markets in which A123, Wanxiang and Johnson Controls 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.
SOURCE A123 Systems, Inc.