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A123systems.com

A123 Systems, Hydro-Quebec, and the University of Texas Settle Lithium Metal Phosphate
Battery Chemistry Patent Dispute

WALTHAM, Mass., Oct. 31, 2011 (GLOBE NEWSWIRE) -- (Nasdaq:AONE), Hydro Québec, and the Board of Regents of the University of Texas System, on behalf of the University of Texas at Austin (UT) today announced that they have settled their patent disputes regarding lithium metal phosphate technologies, entering into a Settlement Agreement and related Patent Sublicense Agreement that will resolve the existing litigations and create licenses going forward. All litigations will be dismissed and a license under these patents will be granted to A123, as agreed by the parties, under the settlement.
In July 2011, Hydro-Québec, Süd-Chemie, Université de Montréal and Centre National de la Recherche Scientifique (CNRS), created an alliance which resulted in the formation of LiFePO4+C Licensing AG, a Swiss-based entity, to promote the broad-based global marketing and licensing of technologies related to lithium metal phosphates, including the lithium metal phosphate patents involved in the present dispute. The alliance has previously granted four sublicenses to these technologies.
Under the terms of the Patent Sublicense Agreement, A123 receives rights to lithium metal phosphate patents developed at UT, a family of electrode material carbon-coating patents, and several lithium metal phosphate patents licensed to Hydro-Québec by Nippon Telephone and Telegraph (NTT). In return, LiFePO4+C Licensing AG receives rights to two recent battery material patents from A123. The A123 patents cross-licensed in this agreement are separate from the original Nanophosphate® patents from the Massachusetts Institute of Technology (MIT), which are not included as part of this settlement. The financial terms of the settlement are not being disclosed at this time.
"We are very pleased to have reached a settlement in this dispute," said Élie Saheb, Executive Vice President, Technology, for Hydro-Québec. "This agreement will help accelerate broad-based market penetration of lithium metal phosphate products." "The market has recognized the ability of phosphate-based lithium ion technology to meet the growing demand for reliable, high-performance energy storage in transportation, grid and commercial applications," said Dave Vieau, CEO of A123 Systems. "We believe this agreement represents a win-win for the entire industry by paving the way for faster adoption." 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® 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 . About Hydro Québec (
Hydro-Québec is a world-class public utility that generates, transmits and distributes electricity. Its sole shareholder is the Québec government. It primarily exploits renewable generating options, in particular hydropower, and supports the development of wind energy through purchases from independent power producers. Its research institute, IREQ, conducts R&D in energy efficiency, energy storage and other energy-related fields. Hydro-Québec invests more than $100 million per year in research. It has been conducting research on batteries for over 30 years, including extensive work on advanced materials, particularly molten salts, lithium iron phosphate and nanotitanates. It is helping to develop safe, high-performance lithium-ion batteries that can be charged more quickly and a greater number of times. The future success of plug-in vehicles largely depends on the battery. Innovation efforts cover both high-power batteries and high-energy batteries.
About the Board of Regents of the University of Texas System
The University of Texas System is one of the nation's largest higher education systems, with nine academic campuses and six health institutions. The UT System has an annual operating budget of $13.1 billion (FY 2012) including $2.3 billion in sponsored programs funded by federal, state, local and private sources. Preliminary student enrollment exceeded 215,000 in the 2011 academic year. The UT System confers more than one-third of the state's undergraduate degrees and educates nearly three-fourths of the state's health care professionals annually. With roughly 87,000 employees, the UT System is one of the largest employers in the state. For more information, visit . Safe Harbor Disclosure
This press release includes forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995 that are subject to risks, uncertainties and other factors, including statements with respect to the adoption of lithium metal phosphate products and the demand for energy storage in various markets. Among the factors that could cause actual results to differ materially from those indicated by such forward-looking statements are: delays in customer and market demand for and adoption of A123's products , delays in the development of A123's products, adverse economic conditions in general and adverse economic conditions specifically affecting the markets in which A123 operates and other risks detailed in A123 Systems' 10-Q for the quarter ended June 30, 2011 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: http://www.a123systems.com/Collateral/Documents/English-US/PRFeed/PDF/619445.pdf

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