<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. 1)
Filed by the Registrant [X]
Filed by a Party other than the Registrant [ ]
Check the appropriate box:
<TABLE>
<S> <C>
[ ] Preliminary Proxy Statement [ ] Confidential, for Use of the Commission Only
(as permitted by Rule 14a-6(e)(2))
[X] Definitive Proxy Statement
[ ] Definitive Additional Materials
[ ] Soliciting Material Pursuant to (S)240.14a-11(c) or (S)240.14a-12
</TABLE>
EXIDE CORPORATION
(Name of Registrant as Specified In Its Charter)
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (check the appropriate box):
[ ] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(j)(2) or
Item 22(a)(2) of Schedule 14A.
[ ] $500 per each party to the controversy pursuant to Exchange Act Rule
14a-6(i)(3).
[ ] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
[X] Fee paid previously with preliminary materials.
[ ] Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11(a)(2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
<PAGE>
EXIDE CORPORATION
------------
NOTICE OF ANNUAL MEETING OF STOCKHOLDERS
Bloomfield Hills, Michigan
July 19, 1996
To the Stockholders:
The Annual Meeting of Stockholders of Exide Corporation will be held on August
14, 1996, at 10:00 a.m. at the Inn at Reading, 1040 North Park Road, Wyomissing,
Pennsylvania, for the following purposes:
1. To elect the Company's Board of Directors;
2. To approve the Company's fiscal 1997 bonus plan;
3. To approve the Company's 1996 Non-Employee Directors Stock Plan;
4. To approve the issuance of Common Stock upon conversion of the Company's
2.90% Convertible Senior Subordinated Notes due 2005;
5. To approve an amendment to the Company's certificate of incorporation to
increase the number of authorized shares of Common Stock from 30,000,000
to 60,000,000;
6. To ratify the appointment of Arthur Andersen LLP as independent auditors
for the Company for the current fiscal year; and
7. To transact such other business as may properly come before the meeting or
any adjournment or postponement thereof.
Only stockholders at the close of business on July 12, 1996 will be entitled
to vote at the meeting or any adjournment or postponement thereof.
By order of the Board of Directors
Bernard F. Stewart
Secretary
PLEASE COMPLETE, DATE AND SIGN THE ENCLOSED PROXY AND RETURN IT PROMPTLY IN
THE ENCLOSED ENVELOPE WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING IN PERSON.
YOUR VOTE IS IMPORTANT.
<PAGE>
EXIDE CORPORATION
1400 North Woodward Avenue
Bloomfield Hills, Michigan 48304
---------------
PROXY STATEMENT
---------------
July 19, 1996
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Exide Corporation (the "Company") to be
used at the Annual Meeting of Stockholders of the Company on August 14, 1996, to
be held at the Inn at Reading, 1040 North Park Road, Wyomissing, Pennsylvania.
This Proxy Statement and accompanying form of proxy are being mailed to
stockholders beginning on or about July 19, 1996. The Company's Annual Report to
stockholders for fiscal year ended March 31, 1996, is enclosed.
Only stockholders of record at the close of business on July 12, 1996 will be
entitled to vote at the meeting. As of such date, there were 20,927,103 shares
of Common Stock issued and outstanding. Each share of Common Stock entitles the
holder to one vote.
The enclosed proxy, if properly signed and returned, will be voted in
accordance with its terms. Any proxy returned without specification as to any
matter will be voted as to each proposal in accordance with the recommendation
of the Board of Directors. You may revoke your proxy at any time before the vote
is taken by delivering to the Secretary of the Company written revocation or a
proxy bearing a later date, or by attending and voting in person at the Annual
Meeting.
The cost of solicitation of proxies will be borne by the Company. In addition
to solicitation of proxies by use of the mail, proxies may be solicited by
directors, officers and regularly engaged employees of the Company. Brokers,
nominees and other similar record holders will be requested to forward
solicitation material and will be reimbursed by the Company upon request for
their out-of-pocket expenses.
Votes cast by proxy or in person at the meeting will be tabulated by the
election inspectors appointed for the meeting and the inspectors will determine
whether a quorum is present. The directors to be elected at the meeting will be
elected by a plurality of the votes cast by the stockholders present in person
or by proxy and entitled to vote. Votes may be cast for or withheld from each
nominee. Votes that are withheld will have no effect on the outcome of the
election because directors will be elected by a plurality of votes cast.
Abstentions may be specified on all proposals submitted to a stockholder vote
other than the election of directors. Abstentions will be counted as present for
purposes of determining the existence of a quorum regarding the other proposals.
Approval of the Company's fiscal 1997 bonus plan and 1996 Non-Employee Directors
Stock Plan and of the issuance of Common Stock upon conversion of the Company's
2.90% Convertible Senior Subordinated Notes due 2005 and ratification of the
appointment of the independent auditors each requires the approval of a majority
of the shares of Common Stock present in person or by proxy and entitled to
vote; and approval of the amendment to the Company's certificate of
incorporation to increase the authorized number of shares of Common Stock
requires approval of a majority of the outstanding shares of Common Stock. Thus,
abstentions on these proposals will have the effect of votes against them.
Under the rules of the New York Stock Exchange, brokers who hold shares in
street name have the authority to vote on certain routine matters on which they
have not received instructions from beneficial owners. For example, brokers
holding shares of Common Stock in street name who do not receive instructions
are entitled to vote on the election of directors, approval of the 1996 Non-
Employee Directors Stock Plan, approval of the increase in the Company's
authorized Common Stock and ratification of the appointment of the independent
auditors. However, brokers may not vote shares held
<PAGE>
for customers on the other proposals without specific instructions from such
customers. Under applicable Delaware law, "broker non-votes" (where a broker
submits a proxy but does not have authority to vote a customer's shares on such
proposal) with respect to the proposals to approve the Company's fiscal 1997
bonus plan and the issuance of Common Stock upon conversion of the Company's
2.90% Convertible Senior Subordinated Notes due 2005 will be considered not
entitled to vote on such proposals and thus will not be counted in determining
whether such proposals receive affirmative votes of a majority of the shares of
Common Stock present and entitled to vote at the Annual Meeting. Therefore,
broker non-votes with respect to such proposals will have no effect on the
outcome of such proposals, although broker non-votes are counted in determining
the existence of a quorum.
1. ELECTION OF DIRECTORS
The directors to be elected at this meeting will serve until the next annual
meeting or until their successors are elected. Each of the nominees for election
as a director has agreed to serve if elected. All of the nominees are presently
directors of the Company. In the event that any nominee should become
unavailable for election, the Board of Directors may designate a substitute
nominee, in which event the shares represented by proxies at the meeting will be
voted for such substitute nominee unless an instruction to the contrary is
indicated on the proxy card. Nominees receiving a plurality of votes of shares
of Common Stock present in person or by proxy at the meeting will be elected as
directors.
The following table sets forth certain information with respect to each
nominee.
<TABLE>
<CAPTION>
PRINCIPAL OCCUPATION
NAME AGE AND DIRECTORSHIPS
- ---- --- --------------------
<S> <C> <C>
Arthur M. Hawkins 53 President, Chief Executive Officer and Director of
the Company since 1985 and Chairman since October
1989. Mr. Hawkins is also a director of Yuasa-
Exide, Inc. which is 13.5% owned by the Company.
Prior to joining Exide in June 1985, Mr. Hawkins
was Group Executive of ITT's worldwide automotive
operations. He has spent twenty years in the
automotive industry including six years with
Tenneco Automotive as a Senior Vice President of
their Automotive Division, General Manager of
Walker Manufacturing Company and Operations Vice
President of Monroe Automotive Equipment Company.
Prior to joining Tenneco Automotive, he held
various managerial and executive positions with
Chrysler Corporation, including assignments to
Latin America, Mexico, Australia, Europe and North
America.
Douglas N. Pearson 52 Executive Vice President, President--North American
Operations of the Company primarily responsible
for its automotive business since June 1985 and a
director since March 1988. Prior to joining Exide,
Mr. Pearson was Vice President of Sales and
Marketing for Monroe Automotive Equipment Company,
a division of Tenneco Automotive. Mr. Pearson
spent fifteen years with Tenneco Automotive and
held various managerial and executive positions
within their Automotive Division including
Regional Sales Manager, Vice President of National
Account Sales and Vice President of Corporate
Planning, Development and Far East Operations.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
Principal Occupation
Name Age and Directorships
---- --- --------------------
<S> <C> <C>
Alan E. Gauthier 48 Executive Vice President and Chief Financial Officer
since October 1993 and a director since August
1995. Prior to that time he had been Vice
President--Finance since May 1989. Before joining
the Company, he was Senior Vice President and
Chief Financial Officer of Airwork Corporation and
prior to that held senior financial positions with
Commodore Business Machines, Inc. and General
Electric Co.
Earl Dolive 78 Director of the Company since October 1993. Prior to
his retirement, Mr. Dolive had been employed by
Genuine Parts Company since 1937. At Genuine Parts
Company, Mr. Dolive served in various capacities,
including Vice Chairman of the Board of
Directors, Executive Vice President and Chief
Financial Officer.
Robert H. Irwin 68 Director of the Company since July 1990. Mr. Irwin
is currently retired and serves various companies
in a consulting capacity. Prior to his retirement,
Mr. Irwin held the office of President of The
Batesville Casket Company, a subsidiary of
Hillenbrand Industries, for seven years. Mr.
Irwin's career also includes 30 years at Chrysler
Corporation in a variety of engineering and
managerial positions. Mr. Irwin is also a director
of Le Roy Industries, Inc. (a manufacturer of
automotive parts).
Arthur R. Taylor 67 Director of the Company since October 1993. Prior to
his retirement, Mr. Taylor gained 35 years of
financial and manufacturing experience in a
variety of positions, including Director--
Corporate Studies and Director--Finance &
Operations of Chrysler Corporation and Canadian
Representative for the Vertol Division of The
Boeing Company.
</TABLE>
Meetings of the Board of Directors and Committees; Compensation of Directors
The Board of Directors held eight meetings during fiscal 1996. Each director
attended at least 75% of the meetings of the Board of Directors and any
committee on which he served.
The Board of Directors has a Compensation Committee and an Audit Committee.
The nominees who are members of the Compensation Committee are Mr. Irwin
(Chairman), Mr. Dolive and Mr. Taylor. The responsibilities of the Compensation
Committee include reviewing and approving executive remuneration and supervising
the administration of the Company's employee benefit plans. The Compensation
Committee met two times during fiscal 1996. The nominees who are members of the
Audit Committee are Mr. Taylor and Mr. Dolive. Mr. Taylor has been appointed
Chairman of the Audit Committee effective August 14, 1996. The responsibilities
of the Audit Committee include recommending to the Board of Directors the
independent certified public accountants to be selected to conduct the Company's
annual audit and reviewing the accounting and financial controls used by the
Company. The Audit Committee met seven times during fiscal 1996. The Company
does not have a nominating committee.
<PAGE>
Directors who are not officers or employees of the Company receive a
quarterly retainer fee of $7,000 plus reimbursement of expenses for attending
each meeting of the Board of Directors or any committee thereof.
Stock Ownership
The following table sets forth, as of July 12, 1996, certain information
regarding beneficial ownership of Common Stock by the Company's directors and
executive officers and by each person and entity that, to the knowledge of the
Company based upon filings with the Securities and Exchange Commission ("SEC"),
beneficially owned more than five percent of the Common Stock. Except as
indicated in the notes to the following table, the holders listed below have
sole voting power and investment power over the shares beneficially held by
them. Except as otherwise indicated, the address of each person listed below is
the address of the Company.
<TABLE>
<CAPTION>
NUMBER OF PERCENT
NAME OF BENEFICIAL OWNER SHARES (A) OF CLASS
------------------------ ---------- --------
<S> <C> <C>
Arthur M. Hawkins....................... 2,345,942 11.2%
Douglas N. Pearson...................... 504,075 2.4%
William J. Rankin....................... 113,245 *
Alan E. Gauthier........................ 40,620(b) *
George J. Tinker -- --
Earl Dolive............................. 2,500 *
Timothy O. Fisher (c)................... 2,200 *
Robert H. Irwin......................... 7,200 *
Arthur R. Taylor........................ 200 *
Lawrence M. Wagner (c).................. 2,200 *
All directors and executive
officers of the Company as a
group (10 persons).................... 3,018,182 14.4%
FMR Corp (d)............................ 2,345,606 11.2%
82 Devonshire Street
Boston, MA 02109
T. Rowe Price Associates, Inc. (d)...... 2,415,980 11.2%
100 E. Pratt Street
Baltimore, MD 21202
Putnam Investments, Inc. (d)............ 2,181,600 10.4%
One Post Office Square
Boston, MA 02109
Wilmington Securities, Inc. (e)......... 1,890,884 9.0%
824 Market Street, Suite 900
Wilmington, DE 19801
State of Wisconsin Investment Board..... 1,665,000 8.0%
P. O. Box 7842
Madison, WI 53707
</TABLE>
- ----------------
* Less than 1%.
(a) The following numbers of the shares shown as beneficially owned are subject
to vesting requirements: Mr. Hawkins--240,406; Mr. Pearson--61,840; Mr.
Rankin--30,920; Mr. Gauthier--30,920; all directors and executive officers
as a group--364,086. See "Executive Compensation--Stock Award Plan."
Mr. Hawkins' shares include 5,000 shares owned by his children as to which
he disclaims beneficial ownership and Mr. Gauthier's shares include 700
shares held by his wife and children as to which he disclaims beneficial
ownership.
(b) Includes 8,000 shares issuable upon the exercise of presently exercisable
stock options.
(c) Mr. Fisher and Mr. Wagner have each determined not to stand for re-election
as a director at the Annual Meeting.
(d) These holders report that they are investment advisors with varying
degrees of power to direct investments and note securities which are,
in some cases, held by others. Certain of such reports disclaim beneficial
ownership of all or portions of the securities.
(e) This holder is an indirect wholly-owned subsidiary of The Hillman Company,
which is controlled by a trust for the benefit of Henry L. Hillman. The
trustees of such trust, Mr. Hillman, C.G. Grefenstette and Elsie H.
Hillman, share voting and investment power over the stock of Hillman.
Mr. Wagner, who is both a director and an officer of Hillman,
<PAGE>
and Mr. Fisher, who is an officer of Hillman, disclaim beneficial ownership
of the securities of the Company owned by this holder.
Executive Compensation
The table below shows information concerning compensation for the Company's
executive officers for each of the last three fiscal years.
<TABLE>
<CAPTION>
Summary Compensation Table
Long Term
Annual Compensation Compensation
----------------------- ---------------------------
Restricted Securities
Stock Underlying All Other
Fiscal Year Salary Bonus(1) Award(s)($)(2) Options (#) Compensation (3)
----------- ---------- ------------ -------------- ----------- ----------------
<S> <C> <C> <C> <C> <C> <C>
Arthur M. Hawkins.......................... 1996 $900,000 --0-- --0-- $ 7,950
President and Chief Executive Officer 1995 662,500 $349,900 --0-- --0-- 16,462
1994 550,000 550,000 --0-- --0-- 9,160
Douglas N. Pearson......................... 1996 $450,000 --0-- --0-- --0-- $15,887
Executive Vice President, President-- 1995 331,250 $174,900 --0-- --0-- 22,496
North American Operations 1994 275,000 275,000 --0-- --0-- 20,166
Alan E. Gauthier........................... 1996 $300,000 --0-- --0-- 40,000 $16,019
Executive Vice President and 1995 206,200 $ 84,000 --0-- --0-- 22,806
Chief Financial Officer(4) 1994 155,400 129,720 --0-- --0-- 20,529
George J. Tinker........................... 1996 $325,000 $210,000 --0-- --0-- --0--
Vice President and Chairman 1995 199,946 140,040 $64,500 (6) --0-- $12,835
Exide Holding Europe(5) 1994 --0-- --0-- --0-- --0-- --0--
William J. Rankin.......................... 1996 $230,000 --0-- --0-- --0-- $17,047
Executive Vice President--Group 1995 170,260 $ 72,000 --0-- --0-- 21,493
Operations 1994 150,250 120,000 --0-- --0-- 19,071
</TABLE>
- ----------------
(1) Bonus amounts shown are those accrued for and paid in or after the end of
the fiscal year listed.
(2) The number and value of the aggregate restricted stock holdings of each of
the named executive officers at March 29, 1996 was as follows: Mr. Hawkins,
240,406 ($5,619,490); Mr. Pearson, 61,840 ($1,445,510); Mr. Gauthier,
30,920 ($722,755); Mr. Tinker, none; and Mr. Rankin, 30,920 ($722,755).
The shares of restricted stock held by Messrs. Hawkins, Pearson, Gauthier
and Rankin will vest on the fifth anniversary of the original grant date.
See "Stock Award Plan" below. Each of such named executive officers is
entitled to dividends paid on such restricted stock holdings.
(3) Includes for fiscal 1996 (a) accrued contributions for the Exide Salaried
Retirement and 401(k) Plan, (b) contributions to a Long-Term Disability
Plan, and (c) split-dollar life insurance premiums as follows:
<TABLE>
<CAPTION>
(a) (b) (c)
------- ------- -------
<S> <C> <C> <C>
Mr. Hawkins $7,950 --- ---
Mr. Pearson 8,250 $6,987 $ 650
Mr. Gauthier 8,250 6,598 1,171
Mr. Tinker --- --- ---
Mr. Rankin 6,000 5,141 5,906
</TABLE>
<PAGE>
(4) Mr. Gauthier was appointed Executive Vice President and Chief Financial
Officer in October 1993. Prior to that time, he served as Vice President-
Finance.
(5) Mr. Tinker joined the Company in May 1994.
(6) This award was canceled in October 1995.
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE VALUE
AT ASSUMED ANNUAL RATES OF
STOCK PRICE APPRECIATION
INDIVIDUAL GRANTS FOR OPTION TERM
---------------------------------------------- ------------------------------------
<S> <C> <C> <C> <C> <C> <C> <C>
NUMBER OF % OF TOTAL
SECURITIES OPTIONS EXERCISE
UNDERLYING GRANTED TO OR BASE
OPTIONS EMPLOYEES IN PRICE (PER EXPIRATION
NAME GRANTED (#) FISCAL YEAR SHARE) DATE 0% 5%($)(1) 10%($)(1)
- ---- ----------- ------------ ----------- ---------- -- -------- ---------
Mr. Hawkins -0- N/A N/A N/A N/A N/A N/A
Mr. Pearson -0- N/A N/A N/A N/A N/A N/A
Mr. Gauthier(2) 30,000 29.4% $29.50 11/21/2000 -0- $ 272,747 $ 575,934
10,000 9.8% $50.00 11/17/2000 -0- ($114,084) ($13,022)
Mr. Tinker -0- N/A N/A N/A N/A N/A N/A
Mr. Rankin -0- N/A N/A N/A N/A N/A N/A
- -------------
</TABLE>
(1) The amounts shown in these two columns represent potential realizable
values using the options granted and the exercise prices. The assumed
rates of stock price appreciation are set by SEC rules and are not intended
to forecast the future appreciation of the Common Stock.
(2) Options become exercisable in 20% installments on each anniversary of the
dates of grant.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR END OPTION
VALUES
<TABLE>
<CAPTION>
Number of Securities Underlying
Unexercised Options at Fiscal Value of Unexercised In-the-Money
Year End (#) Options at Fiscal Year End ($)
------------------------------- ---------------------------------
SHARES VALUE
NAME ACQUIRED REALIZED ($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ---- -------- ------------ ----------- ------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Mr. Hawkins -0- N/A -0- -0- -0- -0-
Mr. Pearson -0- N/A -0- -0- -0- -0-
Mr. Gauthier -0- N/A -0- 40,000 -0- -0- (1)
Mr. Tinker -0- N/A -0- -0- -0- -0-
Mr. Rankin -0- N/A -0- -0- -0- -0-
- -----------
</TABLE>
<PAGE>
(1) No value is shown since, at the end of fiscal 1996, such options held by
the named officer had exercise prices that were higher than the stock's
market value at that time.
Stock Award Plan
The Company established an incentive stock plan effective April 1993. Under
this plan, the Company granted 811,662 shares of Common Stock to a broad group
of management employees. At the time of the grants, the Board of Directors
believed that the value of the shares was $2.26. The agreements relating to the
grants require the holders thereof to pay $2.25 per share to the Company prior
to receiving the shares. The shares vest in full at the fifth anniversary of
the original grant date and have certain restrictions related to sale and
transferability, as well as requirements of continued employment with the
Company. The following grants were made to the persons named in the Summary
Compensation Table set forth above: Mr. Hawkins--240,406 shares; Mr. Pearson--
61,840 shares; Mr. Gauthier--30,920 shares; and Mr. Rankin--30,920 shares.
Executive Employment Agreements
The Company entered into employment agreements with Mr. Hawkins in June
1985, Mr. Pearson in June 1985 and Mr. Rankin in June 1987. Each year, the Board
of Directors has authorized amendments to such employment agreements to provide
that the base salaries set by the Compensation Committee for such year are the
minimum salaries under such employment agreements. Such agreements currently
provide for annual base salaries of not less than $900,000, $450,000 and
$230,000, respectively, with the opportunity to earn bonuses under certain
circumstances. These agreements do not contain a stated termination date, but
may be terminated by either party on notice to the other. If the Company
terminates an agreement without cause, the Company will provide severance pay
equal to one year's salary at the rate in effect at the time of termination.
These agreements also prohibit each executive from engaging in certain
competitive activities for two years after termination.
-----------
The following Compensation Committee Report on Executive Compensation and
Performance Graph shall not be deemed incorporated by reference into any filing
under the Securities Act of 1933 or the Securities Exchange Act of 1934,
notwithstanding any general statement incorporating this Proxy Statement into
any such filing, except to the extent the Company specifically incorporates such
information by reference in such a filing.
Compensation Committee Report on Executive Compensation
The Company's compensation program for its executive officers is designed
to enable it to attract and retain highly qualified personnel and to motivate
them to achieve corporate performance objectives so as to enhance stockholder
value.
The principal elements of the senior executives' compensation consist of
base salary, incentive cash bonuses and long-term stock awards.
Prior to the Company's initial public offering in October 1993, executive
compensation decisions were generally made by the full Board of Directors,
rather than the Compensation Committee. Since the Company's shares have been
publicly traded, the Compensation Committee has had a larger role in this area,
although it continues to consider, as the full Board had in the past, the
recommendations of the Chief Executive Officer with respect to the compensation
of the other executive officers.
In determining base salaries for fiscal 1995 and prior years, the Board and
the Committee based their decisions on subjective and informal policies and
considered various factors, including, most importantly, the executive's level
of responsibility and individual performance and also the profitability of the
Company and the understanding of the Board
<PAGE>
members involved, from their personal business experience, of the general levels
of salaries being paid to senior executives in other industrial corporations.
Beginning in fiscal 1996, in anticipation of the Company's expansion into the
European battery market, the Compensation Committee has annually reviewed the
senior executives' compensation programs and recommended to the Board of
Directors compensation levels benchmarked to companies of similar size. Such
companies have not included the companies included in the Peer Group (as defined
below). Accordingly, for fiscal 1996 and 1997 salaries, less importance was
given to the factors referred to above and instead the benchmarking results were
given the greatest weight. As a result, in October 1994, the Compensation
Committee recommended, and the Board of Directors approved, an increase in the
base salaries of its senior executives to approximately the mid-point of the
range of salaries of senior executives with similar duties at the other
companies. Such increase was instituted in two steps--October 1994 and April
1995. For fiscal 1997, the benchmarking process resulted in no change in base
salaries. For additional information on annual base salaries, see "Executive
Compensation--Executive Employment Agreements" above.
Annual cash bonuses can represent a large portion of the total cash
compensation of the Company's executive officers and serve as an incentive to
achieve corporate goals for earnings before interest and taxes. The
Compensation Committee believes that, because the Company's most highly
compensated officers more significantly affect the Company's results of
operations than other officers, a larger portion of their compensation should be
in the form of a cash bonus. In setting fiscal 1996 bonuses, the Compensation
Committee established certain target levels based on earnings before interest
and taxes, as the Compensation Committee had done in the preceding fiscal year
(except that the required level of earnings before interest and taxes was higher
in fiscal 1996). The Company did not achieve the target levels set by the
Compensation Committee in fiscal 1996 with respect to the named executive
officers, except for Mr. Tinker whose target levels were based on European
results. Therefore, Mr. Tinker was the only named executive officer to receive
a bonus. In May 1996, the Compensation Committee established, and the Board of
Directors ratified, the bonus plan described in ''Approval of the Fiscal 1997
Bonus Plan'' below. The Compensation Committee considered the Company's cost
reduction goals for fiscal 1997 in setting the goals in the new bonus plan.
The compensation for the Chief Executive Officer for fiscal 1997 was
determined in the manner described above and no particular quantitative measures
were used in determining his compensation except as so described.
Section 162(m) of the Internal Revenue Code sets a $1 million limit on
deductions for the compensation of each executive officer. Certain performance-
based compensation is excluded from this limit. By virtue of the proposal
described in ''Approval of the Fiscal 1997 Bonus Plan'' below, the Compensation
Committee has structured the Company's annual bonus plan so as to attempt to
bring compensation under such plan within the Section 162(m) exclusion.
Compensation Committee
Robert H. Irwin, Chairman
Earl Dolive
Timothy O. Fisher
Arthur R. Taylor
Performance Graph
Set forth below is a graph comparing the cumulative total returns of (i)
the Company's Common Stock, (ii) the Standard & Poor's(R) 500 Composite Stock
Index ("S&P 500") and (iii) the average of the common stock prices of Echlin
Inc., Federal-Mogul Corporation, Standard Motor Products, Inc. and Stant Corp.,
automobile parts manufacturers (the "Peer Group"), from October 29, 1993 through
March 31, 1996. The graph assumes that $100 was invested on October 29, 1993 in
each (using the closing price of the Company's Common Stock on such date of
$26.875 per share following its initial public offering at $20.00 per share) and
that dividends were reinvested.
<PAGE>
COMPARISON OF CUMULATIVE TOTAL RETURN
AMONG COMPANY, S&P 500 INDEX AND PEER GROUP
FROM OCTOBER 29, 1993 TO MARCH 31, 1996
[GRAPH APPEARS HERE]
<TABLE>
<CAPTION>
- ------------------------------------------------------------
10/29/93 3/31/94 3/31/95 3/31/96
<S> <C> <C> <C> <C>
EXIDE CORPORATION $ 100.00 $ 137.46 $ 137.05 $ 87.34
PEER GROUP $ 100.00 $ 94.81 $ 103.04 $ 99.02
S&P 500 $ 100.00 $ 96.45 $ 111.46 $ 147.25
- ------------------------------------------------------------
</TABLE>
<PAGE>
CERTAIN TRANSACTIONS
In July 1988, the Company entered into a net lease with a corporation whose
stockholders include Messrs. Hawkins, Pearson and Rankin. This corporation owns
approximately 70 acres of land in Michigan which the Company uses for customer
meetings and other business purposes. The lease expires in August 1996 and
provides for rental payments of $26,250 per quarter. The Company believes that
this lease will be extended on terms no less favorable to the Company than those
currently applicable. The Company has the option, exercisable at any time during
the term of this lease and any extension thereto, to purchase the leased
property at its appraised market value.
2. APPROVAL OF THE FISCAL 1997 BONUS PLAN
In May 1996, the Compensation Committee established, subject to stockholder
approval, performance goals under the fiscal 1997 bonus plan for the six most
highly compensated officers of the Company. The business criteria on which the
performance goals are based is earnings before interest and taxes as calculated
in accordance with generally accepted accounting principles using audited
financial information. The maximum amount of compensation that any employee
could be paid under this bonus plan is $1,350,000.
The affirmative vote of a majority of the shares of Common Stock present in
person or by proxy and entitled to vote at the meeting is required for approval
of the fiscal 1997 bonus plan. Approval of this bonus plan is required for all
amounts awarded under the plan to qualify as compensation deductible by the
Company under Section 162(m) of the Internal Revenue Code.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR APPROVAL OF THE FISCAL 1997
BONUS PLAN.
3. APPROVAL OF 1996 NON-EMPLOYEE DIRECTORS STOCK PLAN
On May 23, 1996 the Board of Directors adopted and recommended for
submission to shareholders for their approval the 1996 Non-Employee Directors
Stock Plan (the "Director Stock Plan"). The purpose of the Director Stock Plan
is to provide compensation to non-employee directors of the Company that will
further link such directors' interest with those of the Company's shareholders.
If approved by shareholders, the Director Stock Plan would become effective on
August 14, 1996.
Participation in the Director Stock Plan is limited to directors of the
Company who are not employees of the Company or any of its subsidiaries. An
aggregate of 20,000 shares of Common Stock is reserved for issuance under the
Director Stock Plan. Such number of shares may be appropriately adjusted in the
event of certain changes in the Company's capitalization, such as stock
dividends, stock splits, recapitalizations and the like. Shares of Common Stock
issuable under the Director Stock Plan may be authorized and unissued shares
held in treasury or any combination thereof.
If the Director Stock Plan is approved by shareholders, for each fiscal
year beginning with the year which commenced April 1, 1996, each non-employee
director of the Company who is elected a director at the annual meeting of
Shareholders for such year or who is continuing as a director as of the annual
meeting for such year shall receive an award of 500 shares of Common Stock,
effective as of the conclusion of such Annual Meeting. Such shares may not be
sold, transferred or otherwise disposed of for a period of six months after
receipt (except in the case of the death or disability of the director).
The Director Stock Plan will be administered by the Compensation Committee
of the Board of Directors of the Company or such other committee of the Board as
may be appointed by the Board consisting of not less than three
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members of the Board. The Board of Directors may amend the Director Stock Plan
in any respect, provided that no amendment may be made without number of shares
of Common Stock available for issuance under the accruing to the participants
under the Director Stock Plan, or (iii) participating in the Director Stock
Plan, and provided, further, every six months except to comport with changes in
the Internal Revenue Code of 1986, as amended (the "Code"), or the rules
thereunder. The Board of Directors also has authority to terminate the Director
Stock Plan at any time.
Except as provided in the following sentence, a director will recognize
ordinary income six months following the date of receipt of the shares (i.e., at
the end of the period during which the director may not sell the shares) in an
amount equal to the fair market value of the shares at that time. Within 30 days
after the date the director receives the shares, the director may elect under
Section 83(b) of the Code to recognize taxable ordinary income at the time of
receipt in an amount equal to the fair market value of the shares at such time.
Receipt of the shares shall be considered to have occurred as of the date of the
annual meeting on which the award is effective.
A director's holding period for the shares for tax purposes will begin at
the time taxable income is recognized, and the tax basis in the shares will be
the amount of ordinary income so recognized. Any dividends received on the
shares prior to the date the director recognizes income as described above will
be taxable compensation income when received. The Company is entitled to a
federal income tax deduction equal to the amounts of income recognized by a
director.
The affirmative vote of the holders of a majority of the shares of Common
Stock that are present in person or by proxy and entitled to vote at the Annual
Meeting is required for approval of the Director Stock Plan.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR APPROVAL OF THE 1996 NON-EMPLOYEE
DIRECTORS STOCK PLAN.
4. APPROVAL OF CONVERSION STOCK PROPOSAL
BACKGROUND
The Company entered into a Placement Agreement, dated December 11, 1995
(the "Placement Agreement"), with Morgan Stanley & Co. Incorporated (the
"Placement Agent") under which the Company issued in a private placement $346
million aggregate principal amount at maturity of its 2.90% Convertible Senior
Subordinated Notes due 2005 (the "Notes") on December 15, 1995 and an additional
$51.9 million aggregate principal amount at maturity on January 10, 1996. Net
proceeds to the Company from the Note offering were approximately $279.9
million. The Notes were sold by the Placement Agent to qualified institutional
buyers and other institutional accredited investors. The Notes are convertible
at the option of the holders thereof at any time prior to maturity, at an
initial conversion rate of 12.5473 shares of Common Stock per $1,000 principal
amount at maturity of Notes (approximately $79.70 per share), subject to
adjustment from time to time upon the occurrence of certain events. If all of
the Notes were converted at such conversion rate, 4,992,571 shares of Common
Stock would be issued. The net proceeds from the sale of the Notes were used to
repay certain of the Company's indebtedness under its Credit Agreement.
The Notes are redeemable at any time on or after December 15, 1998 at the
option of the Company, in whole or in part, initially at a redemption price
equal to the issue price (72.329% of the principal amount at maturity) plus
accrued original issue discount, plus interest accrued, in each case to the
redemption date. The Notes may also be redeemed at the option of the holder if
there is a Fundamental Change (as defined in the Indenture under which the Notes
were issued). The interest payable on the Notes at 2.90% per annum plus the
27.671% original issue discount which is payable at maturity represent a 6.75%
per annum yield to maturity.
The initial conversion rate mentioned above is subject to adjustment (under
formulae set forth in the Indenture for the Notes) in certain events, including:
(i) the issuance of Common Stock as a dividend or distribution on Common Stock
of the Company (ii) certain subdivisions and combinations of the Common Stock;
(iii) the issuance to all holders of Common Stock of certain rights or warrants
to purchase Common Stock; (iv) the distribution to all holders of Common Stock
of shares of capital stock of the Company (other than Common Stock) or evidences
of indebtedness of the Company or assets (excluding those rights, warrants,
dividends and distributions referred to above and dividends
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and distributions in connection with the liquidation, dissolution or winding up
of the Company or paid in cash); (v) distributions consisting of cash, excluding
(x) any quarterly cash dividend on the Common Stock to the extent that the
aggregate cash dividend per share of Common Stock in any quarter does not exceed
the greater of (A) the amount per share of Common Stock of the next preceding
quarterly cash dividend on the Common Stock to the extent that such preceding
quarterly dividend did not require an adjustment of the conversion price
pursuant to this clause (v) (as adjusted to reflect subdivisions or combinations
of the Common Stock), and (B) 3.75 percent of the current market price (as
defined in the Indenture) of the Common Stock on the trading day immediately
prior to the date of declaration of such dividend, and (y) any payment in
respect of a tender or exchange offer by the Company or any subsidiary of the
Company for the Common Stock to the extent that the cash and value of any other
consideration included in such payment per share of Common Stock exceeds the
current market price per share of Common Stock on the trading day next preceding
the date on which the Company becomes irrevocably obligated to make such payment
and payments in respect of certain terms or exchange offers by others.
THE NYSE APPROVAL REQUIREMENT
The Board approved the issuance of the Notes because the Board believed the
application of the net proceeds as described above would provide the Company
with needed financial flexibility to fund the Company's business strategy at a
reasonable cost while minimizing the dilutive effect of the potential issuance
of additional stock on the Company's existing stockholders.
It is the policy of the New York Stock Exchange (the "NYSE"), on which the
Company's outstanding Common Stock is listed for trading, to require stockholder
approval of the issuance, other than in a public offering, of common stock or
securities convertible into Common Stock if such common stock (including Common
Stock issuable upon conversion of such convertible securities) has, or would
have upon issuance, voting power equal to or in excess of 20% of the voting
power outstanding before such issuance. If all of the shares issuable upon
conversion of the Notes were outstanding, such shares would represent
approximately 24% of the Common Stock currently outstanding immediately prior to
such issuance.
The stockholders are being asked to approve the issuance of Common Stock
upon conversion of the Notes in response to the policy of the NYSE. The
affirmative vote of a majority of the outstanding shares of Common Stock is
required to approve such proposal. If the required affirmative vote by the
stockholders is not obtained, the Notes will remain outstanding in accordance
with their terms, including the right to convert the Notes into Common Stock.
BECAUSE OF THE IMPORTANCE OF MAINTAINING A MARKET FOR THE TRADING OF THE
COMPANY'S COMMON STOCK ON THE NYSE, THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR
SUCH PROPOSAL. If the required stockholder approval were not obtained, the NYSE
could commence delisting proceedings. In such an event, the Company would seek
another exchange or market for the trading of its Common Stock.
5. APPROVAL OF AN INCREASE IN THE COMPANY'S AUTHORIZED COMMON STOCK
The Board of Directors proposes that the Company's certificate of
incorporation be amended to increase the total number of authorized shares of
Common Stock from 30,000,000 shares to 60,000,000. Currently, the certificate of
incorporation authorizes 30,000,000 shares of Common Stock $0.01 par value per
share, and 5,000,000 shares of Preferred Stock, $0.01 par value per share. As of
July 12, 1996, none of the Preferred Stock was issued and the Company had
20,927,103 shares of Common Stock outstanding, leaving 9,072,826 authorized
shares available for further issuance, of which 700,000 shares have been
reserved for issuance under the Company's 1993 Long Term Incentive Plan and
4,992,571 shares were reserved for issuance upon conversion of the Company's
2.90% Convertible Senior Subordinated Notes due 2005 (see item 4 above). In
addition, if the 1996 Non-Employee Directors Plan (see item 3 above) is
approved, an additional 20,000 shares will be reserved for issuance under such
plan.
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The Board of Directors believes that the availability of additional shares
will enhance the Company's flexibility in connection with possible future
actions, such as equity offerings, stock dividends, acquisitions or mergers, and
other corporate purposes. The Board of Directors will determine whether, when,
and on what terms the issuance of shares may be warranted in connection with any
of the foregoing purposes.
The availability for issuance of additional shares of Common Stock could
enable the Board of Directors to render more difficult or discourage an attempt
to obtain control of the Company. For example, by increasing the number of
outstanding shares, the interest of a party attempting to gain control of the
Company could be diluted. Also, the additional shares could be used to render
more difficult a merger or similar transaction.
If the proposed amendment is approved, all or any of the additional
authorized shares of Common Stock may be issued without further action by the
stockholders and without first offering such shares to the stockholders for
subscription. The issuance of shares otherwise than on a pro-rata basis to all
current stockholders would reduce current stockholders' proportionate interests.
However, in any such event, stockholders wishing to maintain their interests may
be able to do so through normal market purchases.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR APPROVAL OF THE PROPOSED
INCREASE. The affirmative vote of a majority of the outstanding shares of Common
Stock of the Company is required for approval of the proposed amendment. If the
proposed amendment is adopted by the stockholders, it will become effective upon
filing and recording a Certificate of Amendment as required by the Delaware
General Corporation Law.
6. RATIFICATION OF SELECTION OF INDEPENDENT AUDITORS
The Board of Directors proposes that the stockholders ratify the
appointment by the Audit Committee of Arthur Andersen LLP to serve as the
Company's independent auditors for the 1997 fiscal year. The Board of Directors
anticipates that representatives of Arthur Andersen LLP will be present at the
meeting to respond to appropriate questions, and they will have an opportunity,
if they desire, to make a statement.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR THE RATIFICATION OF THE
APPOINTMENT OF ARTHUR ANDERSEN LLP AS THE INDEPENDENT AUDITORS.
OTHER INFORMATION
Management has no reason to believe that any other business will be
presented at the Annual Meeting, but if any other business shall be presented,
votes pursuant to the proxy will be cast thereon in accordance with the
discretion of the persons named in the accompanying proxy.
Stockholder proposals to be presented at the 1997 Annual Meeting must be
received by the Company on or before April 16, 1997, for inclusion in the proxy
statement relating to that meeting. Proposals should be sent to the attention of
the Secretary of the Company. In addition, the Company's By-laws contain certain
requirements with respect to the submission of proposals and the nomination of
directors at any stockholder meeting.
The Company will furnish, without charge, to each person whose proxy is
being solicited, upon request of such person, one copy of the Company's Annual
Report on Form 10-K for the fiscal year ended March 31, 1996, as filed with the
Securities and Exchange Commission. Requests for copies of such report should be
directed to the attention of the Corporate Secretary, Exide Corporation, 645
Penn Street, Reading, Pennsylvania 19601-4205.
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PROXY
Solicited by the Board of Directors
EXIDE CORPORATION
1400 North Woodward Avenue, Suite 130
Bloomfield Hills, Michigan 48304
The undersigned hereby appoints Bernard F. Stewart and Alan E. Gauthier,
and each of them, proxies, with power of substitution and revocation, to vote
the stock of Exide Corporation which the undersigned is entitled to vote, at the
Annual Meeting of Stockholders to be held on August 14, 1996 and at any
adjournment or postponement thereof, with all the powers the undersigned would
possess if present, with respect to the following:
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" ITEMS 1 THROUGH 6.
1. Election of directors FOR all nominees [_] WITHHOLD AUTHORITY [_]
(except as indicated) to vote for all nominees
Nominees: Arthur M. Hawkins, Douglas N. Pearson, Alan E. Gauthier, Earl Dolive,
Robert H. Irwin and Arthur R. Taylor
(TO WITHHOLD AUTHORITY TO VOTE FOR ANY NOMINEE, STRIKE OUT THAT NOMINEE'S NAME.)
2. Approval of the Company's fiscal 1997 bonus plan.
[_] FOR [_] AGAINST [_] ABSTAIN
3. To approve the Company's 1996 Non-employee Directors Stock Plan.
[_] FOR [_] AGAINST [_] ABSTAIN
4. To approve the issuance of Common Stock upon conversion of the Company's
2.90% Convertible Senior Subordinated Notes due 2005.
[_] FOR [_] AGAINST [_] ABSTAIN
5. To approve an amendment to the Company's certificate of incorporation to
increase the number of authorized shares of Common Stock from 30,000,000 to
60,000,000.
[_] FOR [_] AGAINST [_] ABSTAIN
6. Ratification of the appointment of Arthur Andersen LLP as the Company's
independent public accountants.
[_] FOR [_] AGAINST [_] ABSTAIN
7. In their discretion, the proxies are authorized to vote upon any other
matter which may properly come before the meeting.
<PAGE>
THIS PROXY, WHEN PROPERLY EXECUTED, WILL BE VOTED IN THE MANNER DIRECTED
HEREIN BY THE UNDERSIGNED. IF NO DIRECTION IS MADE, THIS PROXY WILL BE VOTED FOR
ALL NOMINEES LISTED AND FOR ITEMS 2 THROUGH 6.
Please sign exactly as name appears. When shares are held by joint tenants, both
should sign. When signing as attorney, executor, administrator, trustee or
guardian, please give full title as such. If a corporation, please sign in full
corporate name by President or other authorized officer. If a partnership,
please sign name by authorized person.
Dated: , 1996
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(Signature)
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(Signature if held jointly)
