Exhibit 10.13


 


LEASE CONTRACT OF WORKSHOP


 


Lessor (hereinafter
referred to as Party A): Changzhou High-Tech
District EPZ Investment & Development Co., Ltd, which is
located at No.2 Xinzhu road, Xinbei District, Changzhou


 


Lessee (hereinafter
referred to as Party B): A123 Systems (China)
Materials Co., Ltd, which is located in Changzhou Export Processing
Zone (EPZ)


 


Party
A and Party B have reached an agreement with regard to lease of standard
workshop in Changzhou EPZ to conclude the following contract:


 


Article 1.         Workshop


 


(1)    Location: The leased workshop
is located in standard workshop district of Changzhou High-Tech EPZ, the name
of the workshop is A7;


 


(2)    Area of structure: 13,353
square meters


 


(3)    Construction: Reinforced
concrete frame construction


 


(4)    Affiliated facilities
(electricity, water supply, sewage disposal facility and pipeline)


 


Article 2.         Use


 


Party
A and Party B mutually agree that the leased workshop will be used for
industrial production and handling official business. Party B shall not change
the use of the leased workshop unless obtaining the consent of Party A.


 


Article 3.         Lease
term: three (3) years


 


(1)    The lease term will be from 1st March 2009 to 29th February 2012.


 


(2)    Party B may require an
extension of the lease term to the oncoming of expiration day of this lease
contract, by necessarily sending a written notice to Party A three
(3) months before the expiration day of this lease contract. Both parties
shall re-sign this contract or sign a new lease contract for the extension of
the lease term.


 


Article 4.         Rent
and payment


 


(1)   Party B shall pay to Party A
for the rent and fees for property management.


 


The
rent will be RMB11 per square meter per month, RMB 0.5 for property management.


 


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(2)   Payment:


 


(1)       After execution of this lease contract, the deposit
Party B paid last quarter will be transferred as cash pledge for this quarter.


 


(2)       The rent and fees for property management shall be paid
every three (3) months, and shall be paid off within 5 days since the
beginning of the quarter.


 


(3)       Party A shall bear the tax relating to issuance of
invoice.


 


(4)       The payment will be fulfilled with cash or credit to
Party A, and currency of settlement shall be Renminbi (RMB).


 


Article 5.         Delivery and receiving


 


(1)   Party A shall delivery the workshop set forth in this
lease contract to Party B at the execution date of this lease contract.


 


(2)   Party A may deem that Party B has received the leased
workshop according to the term set forth in (1) of Article 5,
although Party B fails to do so on time.


 


(3)   Both parties shall jointly examine, check and receive
the leased workshop, its decoration and finishing, and affiliated facilities by
setting down in writing during delivery and receiving of the workshop.


 


Article 6.         Decoration and finishing and setting up of workshop,
replenishment of facilities


 


(1)     Party B shall appropriately maintain and protect the
leased workshop and the affiliated facilities, and shall preserve cleanliness
and safety. Party B shall not dismantle/remove, decorate or modify the workshop
or the facilities without consent of Party A and any objective reason.


 


(2)     Any necessary decoration, finishing and setting up action shall be done
on the basis of no alteration or modification to the original structure of
workshop. Moreover, Party B shall obtain the consent of Party A, and shall
report to Party A any accessorial facilities to be used in decoration,
finishing and setting up of the workshop for the record. Party B shall bear all
expenses and may restore the workshop to the original state or return it to
Party A together with all the decorations after expiration day of this lease
contract.


 


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Article 7.         Rights and liabilities


 


(1)   Party A shall deliver the leased workshop to Party B at the stipulated
time of this lease contract.


 


(2)   Party A shall ensure the validity and integrality of
use of the leased workshop and the land subject to the stipulation in this
lease contract, and shall guarantee that Party B can use the workshop without
interference from any third party.


 


(3)   Party A shall guarantee the security of use of the
leased workshop, and shall be responsible for common repair and management of
the workshop.


 


(4)   Party A has the right to supervise the use of the
workshop and facilities and the disposal of domestic garbage.


 


(5)   Party B has the right to start the inside decoration
and stringing/wiring for facilities installation after receiving the leased
workshop.


 


(6)   Party B shall pay to Party A the rent on schedule
subject to the stipulation of this lease contract.


 


(7)   Party B shall appropriately use and manage the leased
workshop, shall not sublease, transfer or under-lease the workshop, or conduct
any illegal activity in the workshop, or prejudice the public interests, or
change the use of the workshop without consent of Party A. Party B shall ensure
lawful operation, maintain fire prevention and sanitation.


 


(8)   Party B shall bear all expenses for water and
electricity supply incurring after receiving the workshop A7.


 


(9)     Party B shall conduct the preparation for restoration
of the workshop after termination of this lease contract.


 


Article 8.         Liabilities


 


(1)   This lease contract will come into legal force as soon
as it is signed by both parties; neither party shall breach this lease contract
by throwing the lease without mutual consent (except of force majeure).


 


(2)   Party B shall pay to Party A an amount being equal to
5‰ of the total rent per day as fine for delaying payment of rent and fees for
property management. Party A may deem a 60-day overdue payment by Party B to be
a serious breach of this lease contract, and reserves the right to unilaterally
terminate this lease contract.


 


(3)   Party A will deem the Party B to seriously breach this
lease contract 


 


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under any of the following
circumstances, and may terminate this contract before expiration day and
retract the leased workshop, the cash pledge received by Party A will not be
refunded to Party B, and Party A reserves the right to claim against Party B
for actual losses.


 


(1) The Lessee (Party B) sublease, transfer or under-lease the workshop
without consent of the Lessor (Party A);


 


(2)       The Lessee (Party B) conduct illegal activities in the
leased workshop, which prejudices public interests;


 


(3)       The Lessee (Party B) changes the use of the leased
workshop without consent of the Lessor (Party A) and approval of related
administrative authority;


 


(4)       The Lessee (Party B) alters/modifies the structure of
the workshop without consent of Party A, and destroys the workshop and
accessorial facilities.


 


Article 9.         Termination of this lease contract


 


(1)   Party B shall handle the procedure of restoration with Party A within 10
days after the expiration of the lease term, the contract will be terminated
after both parties check and affirm the workshop and accessorial facilities. If
no dissidence relating to restoration of the workshop, Party A shall refund the
cash pledge to Party B within 5 days after restoration of the workshop.


 


(2)   If either party needs to terminate this lease contract
during the lease term due to any objective reason, the party applying for
termination shall give one-month written notice to the other party, and handles
the procedures by consensus.


 


(3)   If this lease contract will be terminated in advance
due to Party B’s breach of this contract or other reasons, Party B shall handle
the procedure of restoration within 10 days after termination of this lease
contract or after receipt of notice from Party A.


 


(4)   Party A will reserve the right to doubly charge for
monthly rent as occupancy expense and claim against Party B for any other
economic loss, if Party B fails to pay for the rent for 30 days after termination
of this lease contract.


 


(5)   Party B shall compensate for all the losses and
shortages occurred on the leased workshop and accessorial facilities caused by
fault of 


 


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Party B found out in the restoration
procedures, and deduct from the cash pledge.


 


Article 10.       The construction company engaged by Party B shall sign a responsibility
pledge for appropriate construction with management authority of Changzhou EPZ
before entering into building site.


 


Article 11.       This lease contract will be governed by the law of the PRC. Any dispute
arising out of this lease contract shall be resolved by amicable consultation.
If any dispute cannot be resolved through consultation, either party shall
bring the dispute before the local court.


 


Article 12.       Any matter not mentioned herein shall be resolved through amicable
consultation by both parties.


 


Article 13.       This lease contract is written in five originals, and will come into
force after execution by duly authorized representatives of both parties and
finishing registration procedure. Party A shall be responsible for registration
of the lease to local management authority and bear the relative expenses.
Party A and Party B hold two originals respectively; the real estate management
authority keeps one original for the record.


 


Article 14.       The Supplementary Agreement of the A7 Lease Contract signed by Party A
and Party B on 20th February 2009,
which concerns the lease of the outdoor facility building, the outbuilding, the
parking shed and the passenger/goods lift, etc., by Party B from Party A,
serves as an attachment of this contract and shall be executed together with
this contract.


 


Party A:           Changzhou High-Tech District EPZ Investment &
Development Co., Ltd 


(official seal)


 


Representative:  Huang Zhen (signature)


 


Date:                 1st March 2009


 


Party B:           A123 Systems (China) Materials Co., Ltd


(official seal)


 


Representative:    Zheng Tao (signature)


 


Date:                 1st March 2009


 


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Supplementary
Agreement of the Lease Contract of Workshop A7


 


Lessor (hereinafter referred to as Party A): Changzhou
High-Tech District EPZ Investment & Development Co., Ltd, which
is located at No.2 Xinzhu road, Xinbei District, Changzhou


 


Lessee (hereinafter referred to as Party B): A123
Systems (China) Materials Co., Ltd, which is located at Building A7
of Changzhou Export Processing Zone (EPZ)


 


Unless otherwise provided, the terms
used in this agreement shall bear the same meanings as specified in the Lease
Contract of Workshop (hereinafter referred to as “the prime contract”) signed
by Party A and Party B on 23rd February 2008.


 


Whereas Party A and Party B
concluded the Lease Contract of Workshop on 23rd February 2008, in the spirit of mutual
benefit and through amicable consultation, the two parties hereby reached the
Supplementary Agreement with respect to the matters not mentioned in the Lease
Contract of Workshop.


 


Article 1. Add the following items to “Article 3 Scope of Lease” of the
prime contract:


 


1.     A7 Outdoor Water Tank 120T (Actual Volume: 100T): After
conclusion of the contract, Party A shall hire an institution of design for
design drawing. The construction work shall start upon the approval of the
design by Party B. The actual cost of the project will be paid back in 10
year’s time as lease rentals and will be collected together with the rent of
the workshop quarterly. Party B shall bear the regular cleaning expenses.


 


2.     Outdoor Facility Building constructed next to A7 (the
building was originally designed as a 4-floor structure; first floor covering
an area of 280 square meters was completed; the following construction
work shall stick to the original design.) 
: the rent will be RMB 11.5 pre square meter a month (property
management fee included) and will be collected together with the rent of the
workshop quarterly.


 


3.     Outbuilding, to the west of A7: area: 423 square
meters; the rent will be RMB11.5 pre square meter a month (property
management fee included) and will be collected together with the rent of the
workshop quarterly.


 


4.     Parking Shed, to the south of A7: area: 300 square
meters; contractual construction price: RMB 177,173.77; the actual
cost of the project will be paid back in 10 year’s time as lease rentals and
will be collected together with the rent of the workshop quarterly.


 


The parking shed previously
constructed by Party B costs RMB 65,594. Party 


 


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A shall pay the amount once Party B
provides the valid invoices and other receipts as proof of the cost. Party B
shall pay lease rentals for this parking shed together with the one constructed
by Party A.


 


The total lease rentals pre quarter
for the two parking sheds: RMB 6,069.2.


 


5.     A 10-Passenger Lift and a 2T goods lift: contractual construction
price: RMB 342,700; the actual cost of the project will be paid back in
10 year’s time as lease rentals and will be collected together with the rent of
the workshop quarterly. Party A shall bear the regular maintenance fee, while
Party B shall be responsible for any repair expenses caused by its own misuse
of the lifts. The lease rentals pre quarter for the lifts: RMB 8,567.5.


 


6.     Smoking Shed: contractual construction price:
RMB14,745.8; the actual cost of the project will be paid back in 10 year’s
time as lease rentals; the lease rentals pre quarter: RMB 368.6.


 


7.     Within 14 days after the conclusion of the contract,
Party B shall pay Party A RMB 100,000 as the down payment for the construction
of items specified in item1, 2 and 3. After Party B makes the formal
acceptance, lease rentals can be deducted from said down payment. When all the
down payment has been deducted, the lease rentals shall be paid together with
the rent of the workshop quarterly.


 


8.     The total lease rentals of item 4, 5 and 6 pre quarter:
RMB 15,005.3.


 


9.     Lease term: subject to the prime contract.


 


Article 2. Add the following items to “Article 4 Miscellaneous” of the
prime contract:


 


1.     In case Party B, without any just cause, refuses to takeover the
aforementioned items when Party A intent to hands them over after a proper
final acceptance of the construction, Party B shall bear all the construction
expenses occurred during the construction period.


 


2.     Lease rentals of the parking sheds and the smoking shed shall be collected
since 1st January 2009.


 


3.     Lease rentals of the building constructed next to the south-west side of
A7 since 1st June 2008: RMB 22,540; Lease
rentals of the lifts since 1st May 2008:
RMB 22,846; by 31st December 2008, the total payable lease
rentals is  RMB 45,386, which shall be paid in a lump-sum payment within
10 days after the conclusion of this contract. The later occurred lease rentals
shall be collected quarterly since 1st January 2009.


 


4.     Lease rentals of the uncompleted items shall be collected since the date
of formal acceptance. The payment shall be made in the same manor as described
above.


 


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5.     With respect to the construction of item 1, 2, 3, 4 and 6, Party B has
the right to have the qualities and costs of the facilities inspected and
audited by its own auditing firm. However, as long as the audited price fall
within the reasonable range, Party B must accept the auditing result provided
by Party A.


 


This agreement, when coming into
effect, shall be deemed as an indivisible part of the Lease Contract of
Workshop, which will be of the same effect as the Lease Contract of Workshop.


 


Except the articles specifically
amended in this agreement, the rest parts of the prime contract shall remain the
same with full effect.


 


Attachments:


 


Photocopies of the construction contract for item 4, 5 and 6.


 


This agreement is written in 2 originals, one for each party.


 


Party A:           Changzhou High-Tech District EPZ Investment &
Development Co., Ltd


(official seal)


 


Representative:


 


Date:                 20th February 2009


 


Party B:           A123 Systems (China) Materials Co., Ltd


(official seal)


 


Representative:


 


Date:


 


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