Why won't my PowerPivot for Excel 2010 workbook upgrade to Excel 2013?

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Recently we've seen an issue where some Excel 2010 workbooks containing PowerPivot models encounter errors when attempting to upgrade to Excel 2013. When opening a PowerPivot model that was created in Excel 2010 in Excel 2013 you will be prompted to upgrade with the following message:

This workbook has a PowerPivot data model created using a previous version of the PowerPivot add-in. You will need to upgrade this data model with PowerPivot for Excel 2013.

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