WALTHAM, Mass., December 11, 2012 - A123 Systems, Inc., ("A123" or "the Company"), a developer and manufacturer of advanced Nanophosphate® lithium iron phosphate batteries and systems, today announced that it has received approval from United States Bankruptcy Court for the District of Delaware (the "Court") to sell substantially all of A123's assets to Wanxiang America Corporation ("Wanxiang"). The Court has also granted approval for A123 to sell its government business to Navitas Systems.

As previously announced, A123 and Wanxiang have agreed to terms on an asset purchase agreement through which Wanxiang would acquire substantially all of A123's assets for $256.6 million. The sale is subject certain closing conditions, including approval from the Committee for Foreign Investment in the United States (CFIUS). Excluded from the asset purchase agreement with Wanxiang is A123's Ann Arbor, Mich.-based government business, including all U.S. military contracts, which would be acquired for $2.25 million by Navitas Systems through a separate asset purchase agreement.

"Receiving Court approval of our asset purchase agreement with Wanxiang and Navitas is an important step toward finalizing the sale of A123's assets, and we are now focused on CFIUS approval of the sale to Wanxiang, which we are confident that we will receive given the structure of this transaction," said Dave Vieau, Chief Executive Officer of A123. "We believe an acquisition by Wanxiang will provide A123 with the financial support necessary to strengthen our competitive position in the global vehicle electrification, grid energy storage and other markets, and we look forward to completing the sale."

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. Court documents and additional information can be found at a dedicated website administrated by the Company's Claims Agent, Logan & Company: www.loganandco.com.

About A123 Systems
A123 Systems, Inc. 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 purchase 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 and consents, including antitrust and other regulatory approvals, to close the transactions contemplated by Wanxiang purchase agreement. Among the factors that could cause actual results to differ materially from those indicated by such forward-looking statements are: failure to obtain required CIFIUS and other required 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 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.

Media Contact:

Dan Borgasano
617-972-3471
dborgasano@a123systems.com


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