<PAGE>
SCHEDULE 14A INFORMATION
Proxy Statement Pursuant to Section 14(a) of the Securities Exchange Act of 1934
(Amendment No. __)
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] 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
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):
[X] No fee required.
[_] $125 per Exchange Act Rules 0-11(c)(1)(ii), 14a-6(i)(1), or 14a-6(i)(2) or
Item 22(a)(2) of Schedule 14A.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
[_] 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 14, 1997
To our Stockholders:
The Annual Meeting of Stockholders of Exide Corporation will be held on
August 12, 1997, at 10:00 a.m. at the Company's facility at 364 Exide Drive,
Bristol, Tennessee, for the following purposes:
1. To elect the Company's Board of Directors;
2. To approve amendments to the Company's 1996 Non-Employee Directors Stock
Plan;
3. To approve the Company's 1997 Stock Option Plan;
4. To ratify the appointment of Arthur Andersen LLP as independent auditors
for the Company for the current fiscal year; and
5. 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 7, 1997 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 14, 1997
This Proxy Statement is furnished in connection with the solicitation of
proxies by the Board of Directors of Exide Corporation (the "Company" or
"Exide") to be used at the Annual Meeting of Stockholders of the Company on
August 12, 1997, to be held at the Company's facility at 364 Exide Drive,
Bristol, Tennessee. This Proxy Statement and accompanying form of proxy are
being mailed to stockholders beginning on or about July 14, 1997. The
Company's Annual Report to stockholders for fiscal year ended March 31, 1997
is enclosed.
Only stockholders of record at the close of business on July 7, 1997 will be
entitled to vote at the meeting. As of such date, there were 21,336,772 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 of shares of Common Stock present in person or by proxy at the meeting.
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 amendments to the Company's 1996 Non-Employee
Directors Stock Plan and the Company's 1997 Stock Option Plan 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.
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 voting instructions from beneficial owners.
Consequently, brokers holding shares of Common Stock in street name who do not
receive voting instructions are entitled to vote on the election of directors
of the Company, approval of the amendments to the 1996 Non-Employee Directors
Stock Plan and ratification of the appointment of the independent auditors.
However, brokers may not vote shares held for customers on the approval of the
1997 Stock Option Plan without specific voting instructions from such
customers. Under applicable Delaware law, "broker non-votes" (where a broker
submits
<PAGE>
a proxy but does not have authority to vote a customer's shares on such
proposal) with respect to the proposal to approve the Company's 1997 Stock
Option Plan will be considered not entitled to vote on such proposal and thus
will not be counted in determining whether such proposal receives the
affirmative vote 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 proposal will have no effect on the outcome of such proposal,
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>
NAME AGE PRINCIPAL OCCUPATION AND DIRECTORSHIPS
---- --- ------------------------------------------------------
<C> <C> <S>
Arthur M. Hawkins 54 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 53 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.
Alan E. Gauthier 49 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 79 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 Senior Vice President, Vice Chairman of the
Board of Directors, Executive Vice President, Chief
Administrative Officer and Chief Financial Officer.
</TABLE>
2
<PAGE>
<TABLE>
<CAPTION>
NAME AGE PRINCIPAL OCCUPATION AND DIRECTORSHIPS
---- --- ----------------------------------------------------
<C> <C> <S>
Robert H. Irwin 69 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).
Thomas J. Reilly, Jr. 57 Director of the Company since 1996. Until 1996, Mr.
Reilly was a partner with Arthur Andersen LLP which
he joined in 1965.
Arthur R. Taylor 68 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.
James T. Watson 61 Director of the Company since 1997. Mr. Watson spent
32 years, until 1995, with Chrysler Corporation in
various management positions, including Director--
International Procurement. He is currently serving
as a director of North American procurement for
Porsche AG.
</TABLE>
MEETINGS OF THE BOARD OF DIRECTORS AND COMMITTEES; COMPENSATION OF DIRECTORS
The Board of Directors held five meetings during fiscal 1997. 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 present members of the Compensation Committee are Mr. Irwin (Chairman), Mr.
Dolive, Mr. Watson 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 1997. The present members of
the Audit Committee are Mr. Taylor (Chairman), Mr. Dolive and Mr. Reilly. 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 four times during fiscal
1997. The Company does not have a nominating committee.
Directors who are not officers or employees of the Company receive a
quarterly retainer fee of $7,000, plus $2,500 per quarter for committee chairs
plus reimbursement of expenses for attending each meeting of the Board of
Directors or any committee thereof. In addition, under the 1996 Non-Employee
Directors Stock Plan each such director will receive an award of 500 shares of
Common Stock effective as of the conclusion of each annual meeting at which he
is elected and, if the proposed amendments to such plan described below are
approved by the stockholders, a portion of the fees of such directors will be
paid in Common Stock and the recent one-time grants of additional Common Stock
will be confirmed.
3
<PAGE>
STOCK OWNERSHIP
The following table sets forth, as of July 7, 1997, certain information
regarding beneficial ownership of Common Stock by the Company's directors and
the executive officers named in the Summary Compensation Table below 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
SHARES OF
NAME OF BENEFICIAL OWNER (A) CLASS
------------------------ --------- -------
<S> <C> <C>
Arthur M. Hawkins........ 2,290,942 10.7%
Douglas N. Pearson....... 514,075 2.4%
William J. Rankin........ 113,245 *
Alan E. Gauthier......... 48,820(b) *
George J. Tinker......... -- *
Earl Dolive.............. 3,000 *
Robert H. Irwin.......... 30,000 *
Thomas J. Reilly, Jr..... 1,000 *
Arthur R. Taylor......... 500 *
James T. Watson.......... 1,000 *
All directors and
executive officers of
the Company
as a group (10 persons). 3,002,582 14.1%
State of Wisconsin
Investment Board........ 2,065,000 9.7%
P.O. Box 7842
Madison, WI 53707
Wilmington Securities,
Inc..................... 1,890,884 8.9%
824 Market Street, Suite
900
Wilmington, DE 19801
T. Rowe Price Associates,
Inc..................... 1,739,380 8.2%
P.O. Box 89000
Baltimore, MD 21289
Putnam Investments, Inc.. 1,515,000 7.1%
One Post Office Square
Boston, MA 02109
</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 16,000 shares issuable upon the exercise of presently exercisable
stock options.
4
<PAGE>
EXECUTIVE COMPENSATION
The table below shows information concerning compensation for the Company's
executive officers for each of the last three fiscal years.
SUMMARY COMPENSATION TABLE
<TABLE>
<CAPTION>
ANNUAL
COMPENSATION LONG TERM COMPENSATION
----------------- --------------------------
RESTRICTED SECURITIES ALL OTHER
FISCAL STOCK AWARD(S) UNDERLYING COMPENSATION
YEAR SALARY BONUS(1) ($)(2) OPTIONS (#) (3)
------ -------- -------- -------------- ----------- ------------
<S> <C> <C> <C> <C> <C> <C>
Arthur M. Hawkins....... 1997 $900,000 -0- -0- 130,000 $13,060
President and Chief
Executive 1996 900,000 -0- -0- -0- 7,950
Officer 1995 662,500 $349,900 -0- -0- 16,462
Douglas N. Pearson...... 1997 $450,000 -0- -0- 53,000 $11,312
Executive Vice
President, President 1996 450,000 -0- -0- -0- 15,887
--North American
Operations 1995 331,250 $174,900 -0- -0- 22,496
Alan E. Gauthier........ 1997 $300,000 -0- -0- 35,000 $10,448
Executive Vice
President and 1996 300,000 -0- -0- 40,000 16,019
Chief Financial Officer 1995 206,200 $ 84,000 -0- -0- 22,806
George J. Tinker........ 1997 $350,000 $210,000 -0- -0- -0-
Vice President and
Chairman of 1996 325,000 210,000 -0- -0- -0-
Exide Holding Europe(4) 1995 199,946 140,040 $645,500(5) -0- $12,835
William J. Rankin....... 1997 $230,000 -0- -0- -0- $16,411
Executive Vice
President-- 1996 230,000 -0- -0- -0- 17,047
Group Operations 1995 170,260 $ 72,000 -0- -0- 21,493
</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 31, 1997 was as follows: Mr.
Hawkins, 240,406 ($3,936,648); Mr. Pearson, 61,840 ($1,012,630); Mr.
Gauthier, 30,920 ($506,315); Mr. Tinker, none; and Mr. Rankin, 30,920
($506,315). 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 1997 (a) accrued contributions for the Exide Salaried
Retirement and 401(k) Plan and (b) payments for term life insurance as
follows:
<TABLE>
<CAPTION>
(A) (B)
------ ------
<S> <C> <C>
Mr. Hawkins............................................... $7,940 $5,120
Mr. Pearson............................................... 8,250 3,062
Mr. Gauthier ............................................. 8,250 2,198
Mr. Tinker................................................ -- --
Mr. Rankin................................................ 8,250 8,161
</TABLE>
(4) Mr. Tinker joined the Company in May 1994 and resigned in May 1997.
(5) This award was canceled in October 1995.
5
<PAGE>
OPTION GRANTS IN LAST FISCAL YEAR
<TABLE>
<CAPTION>
POTENTIAL REALIZABLE
VALUE AT ASSUMED ANNUAL
RATES OF STOCK PRICE
APPRECIATION FOR OPTION
INDIVIDUAL GRANTS TERM
----------------------------------------------- -----------------------
NUMBER OF % OF TOTAL
SECURITIES OPTIONS GRANTED EXERCISE OR
UNDERLYING TO EMPLOYEES IN BASE PRICE EXPIRATION 5%
NAME OPTIONS GRANTED (#) FISCAL YEAR(1) (PER SHARE) DATE 0% ($)(2) 10% ($)(2)
- ---- ------------------- --------------- ----------- ---------- --- -------- ----------
<S> <C> <C> <C> <C> <C> <C> <C>
Mr. Hawkins............. 130,000 31.9% $25.875 10/30/06 -0- $929,342 $2,053,603
Mr. Pearson............. 53,000 13.0% 25.875 10/30/06 -0- 378,886 837,238
Mr. Gauthier............ 35,000 8.6% 25.875 10/30/06 -0- 250,207 552,893
Mr. Tinker.............. -0- -- -- -- N/A N/A N/A
Mr. Rankin.............. -0- -- -- -- N/A N/A N/A
</TABLE>
- --------
(1) Options become exercisable in 20% installments on each anniversary of the
dates of grant.
(2) The amounts shown in these two columns represent potential realizable
values using the options granted and the exercise prices. The assumed rates
of stock price appreciation are set by SEC rules and are not intended to
forecast the future appreciation of the Common Stock.
AGGREGATED OPTION EXERCISES IN LAST FISCAL YEAR AND FISCAL YEAR END OPTION
VALUES
<TABLE>
<CAPTION>
NUMBER OF SECURITIES UNDERLYING VALUE OF UNEXERCISED
UNEXERCISED IN-THE-MONEY OPTIONS
OPTIONS AT FISCAL YEAR END (#) AT FISCAL YEAR END ($)(1)
SHARES VALUE ---------------------------------- -------------------------
NAME ACQUIRED REALIZED ($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
- ---- -------- ------------ ----------- ---------------- ----------- -------------
<S> <C> <C> <C> <C> <C> <C>
Mr. Hawkins............. -0- N/A -0- 130,000 -0- -0-
Mr. Pearson............. -0- N/A -0- 53,000 -0- -0-
Mr. Gauthier............ -0- N/A 16,000 59,000 -0- -0-
Mr. Tinker.............. -0- N/A -0- -0- N/A N/A
Mr. Rankin.............. -0- N/A -0- -0- N/A N/A
</TABLE>
- --------
(1) No value is shown since, at the end of fiscal 1997, such options held by
the named officers 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.
6
<PAGE>
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 is designed to enable the Company to
attract and retain highly qualified personnel to serve as executive officers
and to motivate them to achieve corporate performance objectives which will
enhance shareholder value. The principle elements of the Company's
compensation for its executive officers are base salary, incentive cash
bonuses and long term stock awards.
The base salary of the Company's executive officers is reviewed annually and
evaluated with those of consumer product manufacturers of similar complexity
and dollar volume. The executive salaries are commensurate with those of other
executives in comparable positions and the salaries of the domestic executive
officers were last adjusted in April 1995.
Annual incentive cash bonuses have not been awarded to any of the Company's
domestic executive officers in the past two fiscal years. Bonuses for the
domestic executives are predicated on the entire Company's prior year
performance and the new year's planned results. Based on this data, the
Committee sets aggressive bonus targets, based on profit before interest and
taxes, requiring significant improvement over the prior year's actual
performance. The Company must achieve this improvement before the domestic
executive officers become eligible for annual cash incentive bonuses. These
incentive bonuses can represent a significant portion of the short term total
cash compensation of the Company's executive officers and consequently they
are incentivized to achieve or exceed short term established objectives.
The long term incentives provided executives take the form of stock options
which vest in increments over predetermined periods of time. The exercise
price of the options is the share value on the day of the option grant.
Executives can only benefit from such options when the market price of the
Company's shares increase significantly over the predetermined time period
allowing the executive to buy at the exercise price and sell at the then
current market price when the options vest.
The Compensation Committee is composed only of non-employee directors and is
committed to structuring executive long term compensation programs which will
significantly reward the executives if the long term shareholder value
increases as reflected by continuing share price improvement.
Incentive programs which are both ambitious and realistic encourage
participants to achieve the goals, but, if the tasks given to the executives
to realize the intended benefits are unrealistic, the program will be counter-
productive and will not encourage the participants to maximize their
capabilities to the benefit of the Company and its stockholders. Being
cognizant of this fact, the Compensation Committee has developed programs and
is committed to structuring long term executive compensation programs that are
intended to significantly improve the long term shareholder value of the
Company.
Section 162(m) of the Internal Revenue Code sets a $1 million limit on
deductions for the compensation of each executive officer. Such provision
permits some performance-based compensation to be excluded from this limit.
However, the Committee has concluded that compliance with the conditions for
such exclusion would unduly limit its ability to structure appropriate bonus
plans for the executive officers and determined, in light of the small
deduction which might be lost, not to attempt to make such plans comply with
such conditions.
COMPENSATION COMMITTEE
Robert H. Irwin, Chairman
Earl Dolive
Arthur R. Taylor
James T. Watson
7
<PAGE>
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 and Standard Motor Products, Inc., which companies
are automobile parts manufacturers (the "Peer Group"), from October 29, 1993
through March 31, 1997. 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.
COMPARISON OF CUMULATIVE TOTAL RETURN
AMONG COMPANY, S&P 500 INDEX AND PEER GROUP
FROM OCTOBER 29, 1993 TO MARCH 31, 1997
[GRAPH APPEARS HERE]
<TABLE>
<CAPTION>
Measurement Period S&P
(Fiscal Year Covered) [Exide Corporation] 500 INDEX PEER GPOUP
- -------------------- ------------------- --------- ----------
<S> <C> <C> <C>
Measurement Pt-
10/29/93 $100 $100 $100
FYE 3/31/94 $137.46 $ 96.45 $ 94.85
FYE 3/31/95 $137.05 $111.46 $105.02
FYE 3/31/96 $ 87.34 $147.25 $101.54
FYE 3/31/97 $ 61.39 $176.44 $104.37
</TABLE>
SECTION 16(A) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
To the knowledge of the Company, all directors and executive officers of the
Company timely filed all reports required of them under Section 16 of the
Securities Exchange Act of 1934, except that Mr. Watson reported his
acquisition of 1,000 shares of Common Stock, which took place in February 1997,
in May 1997, rather than in March 1997 as required and the recipients of the
stock options referred to in the table above entitled "Option Grants in Last
Fiscal Year" reported the grant of such options in July 1997, rather than by
May 15, 1997 as required.
8
<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, which was extended
in August, 1996, expires on July 1, 2002 and provides for rental payments of
$26,204 per quarter. 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 AMENDMENTS TO 1996 NON-EMPLOYEE DIRECTORS STOCK PLAN
Last year the Board of Directors adopted and the Company's stockholders
approved 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 stockholders. 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 are 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 or shares
held in treasury or any combination thereof. Under the Director Stock Plan,
for each fiscal year each non-employee director of the Company who is elected
a director at the annual meeting of stockholders 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 is 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 members of the Board. The Board of Directors may amend the Director
Stock Plan and also has authority to terminate the Director Stock Plan at any
time.
In April 1997, the Compensation Committee reviewed survey data obtained by
management relating to the compensation paid to independent directors by
corporations comparable in size to the Company. Based upon such data, the
Committee recommended to the Board of Directors that the Director Stock Plan
be amended to provide for (i) a one-time grant to each non-employee director
of restricted Common Stock with a value of $40,600 effective on May 1, 1997,
the date of the next Board meeting, with the number of shares to be determined
based on the closing price of the Common Stock on such date on the New York
Stock Exchange ($16 5/8) and such shares to vest as described below, with
unvested shares to be forfeited if such director ceased during such period to
serve as a director and (ii) the payment of at least 50% of the director and
committee fees otherwise payable to each such director (or such greater
percentage as any such director might elect) to be made in the form of Common
Stock valued at the beginning of the quarter for which the fees are due
commencing with fees due with respect to the first quarter of fiscal 1998. The
Board of Directors adopted such amendments, subject to stockholder approval,
on May 1, 1997, and based on the closing price on such date, the number of
shares of restricted stock granted to each such director was determined to be
2,442. The non-employee directors will be entitled to vote the restricted
stock and receive dividends thereon, but will not be permitted to dispose of
such shares until they have vested. 20% of the restricted stock granted to
each non-employee director will vest upon his re-election as a director at an
annual meeting of the Company, commencing with the 1998 annual meeting.
Except as provided in the following sentence, a director will recognize
ordinary income six months following the vesting of the restricted stock in an
amount equal to the fair market value of the shares at the time. Within 30
days after the date the shares were granted the directors could elect under
Section 83(b) of the Internal Revenue 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.
A director's holding period for the restricted stock 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
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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 amendments to the Director
Stock Plan.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR APPROVAL OF THE AMENDMENTS TO
THE 1996 NON-EMPLOYEE DIRECTORS STOCK PLAN.
3. APPROVAL OF 1997 STOCK OPTION PLAN
The Board of Directors, pursuant to the recommendation of the Compensation
Committee, has adopted and recommends that the stockholders approve the
Company's 1997 Stock Option Plan (the "Plan"). The Board believes that the
Plan is necessary for the Company to continue to provide appropriate
incentives to key employees by linking rewards to increases in the price of
the Common Stock.
The Plan authorizes the granting of stock options to key employees of the
Company and its subsidiaries covering up to 2,000,000 shares of Common Stock,
with any shares covered by forfeited options becoming available again for
grant. A key feature of the Plan is that no options will become vested or
exercisable before May 1, 2007 unless the market price of the Common Stock
increases to certain levels. If it increases to $30.00 per share (the closing
price on the New York Stock Exchange was $23.00 on July 7, 1997), 40% of the
granted options become vested, if it reaches $50.00, another 40% become vested
and if it achieves $75.00 the remainder will become vested, provided, that in
the case of each such percentage which so vests, the vested options are then
only exercisable as follows: 40% on the date of vesting and 20% each on the
first, second and third anniversaries. The exercise price will be no less than
the fair market value of the Common Stock on the date of grant of the option
($16 5/8) and the optionee must continue in the Company's employ for the
options to be exercised, except that an optionee's estate may exercise an
option for one year after his or her death to the extent such option was
exercisable at the date of death. Except for such transfer upon death, options
are not transferable. The maximum number of shares as to which options may be
granted under the Plan to any single employee is 1,000,000. Optionees are
permitted to pay the exercise price with cash, delivery of shares of Common
Stock already owned or withholding of shares receivable upon the exercise
(valued at fair market value on the date of exercise) or a combination
thereof. They may also pay any income taxes due with respect to an exercise
through such withholding of shares.
The Plan is administered by the Compensation Committee who will have the
power to set the terms of options, interpret the Plan and options and make
adjustments for recapitalizations and take other actions affecting the Common
Stock and the options. It may be amended by the Board of Directors, although
the rights of holders of options may not be adversely affected. The Plan
terminates on June 1, 2007.
The following is a brief summary of the current federal income tax rules
(including proposed regulations) relevant to non-qualified stock options
granted to U.S. citizens or residents. The Plan provides that all options
granted under it will be non-qualified. The grant of a non-qualified option
under the Plan does not result in any taxable income to the recipient or
deduction for the Company. However, generally when any such option is
exercised, the excess of the fair market value on the exercise date of the
shares acquired over the aggregate exercise price (the "spread") will be
taxable to the holder as ordinary compensation income and the Company will
generally be entitled to a tax deduction in an amount equal to the income
taxable to the holder. The optionee's tax basis in shares acquired upon
exercise of a non-qualified option will equal the optionee's fair market value
on the exercise date and the optionee's holding period for such shares will
begin on the day after the exercise date. If an optionee delivers shares of
previously-acquired Common Stock ("old shares") in payment of the exercise
price of a non-qualified option, any appreciation or depreciation in the value
of the old
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<PAGE>
shares after their acquisition dates is not taxable as a result of such
delivery. The optionee's tax basis in, and holding period for, the old shares
will carry over to the same number of shares received at exercise on a share-
for-share basis. The fair market value of any additional shares received ("new
shares") at the exercise date will be taxable to the optionee as ordinary
compensation income. The tax basis for the new shares will equal their fair
market value on the exercise date and the holding period for such shares will
begin on the day after the exercise date. The Company will generally be
entitled to a tax deduction equal to the optionee's ordinary income.
The affirmative vote of the holders of a majority of the shares of Common
Stock that we present in person or by proxy and entitled to vote at the Annual
Meeting is required for approval of the 1997 Stock Option Plan.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE FOR APPROVAL OF THE 1997 STOCK
OPTION PLAN.
4. 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 1998 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 1998 Annual Meeting must be
received by the Company on or before March 16, 1998, 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, 1997, 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.
11
<PAGE>
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" ITEMS 1 THROUGH 4.
1. Election of directors
FOR all nominees WITHHOLD
(except as indicated) AUTHORITY
to vote for all nominees
[_] [_]
FOR AGAINST ABSTAIN
2. Approval of the amendments to
the Company's 1996 Non- [_] [_] [_]
Employee Directors Stock Plan.
3. Approval of the Company's 1997
Stock Option Plan. [_] [_] [_]
4. Ratification of the appointment
of Arthur Andersen LLP as the [_] [_] [_]
Company's independent public
accountants.
5. In their discretion, the proxies are authorized to vote upon any other matter
which may properly come before the meeting.
NOMINEES: Arthur M. Hawkins, Douglas N. Pearson, Alan E. Gauthier, Earl Dolive,
Robert H. Irwin, Thomas J. Reilly, Jr., Arthur R. Taylor and James T. Watson.
(To withhold authority to vote for any nominee, strike out that nominee's name.)
I plan to attend the meeting. [_]
Please sign exactly as name appears hereon. 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 in partnership name by authorized person.
Dated: 1997
-------------------------------
-------------------------------------------
(Signature)
-------------------------------------------
(Signature if held jointly)
PLEASE SIGN, DATE, AND RETURN THE PROXY CARD PROMPTLY USING THE
ENCLOSED ENVELOPE
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<PAGE>
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 12, 1997 and at any adjournment or postponement thereof, with all
| the powers the undersigned would possess if present, with respect to the
| following:
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