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XIDE » Topics » Annex A

This excerpt taken from the XIDE DEF 14A filed Jul 27, 2006.
Annex A
 
To the extent that terms and conditions herein overlap with the terms and conditions in the Standby Purchase Agreement and the Registration Rights Agreement (the “Definitive Agreements”), the terms and conditions in the Definitive Agreements shall govern.
 
     
     
Issuer
  Exide Technologies (the “Company”).
     
Aggregate Offering Size   $125.0 million, comprised of a $75.0 million rights offering and a $50.0 million additional subscription privilege for the Standby Purchasers.
     
Authorization   Prior approval of the Company’s board of directors (the ‘‘Board”) and subject to shareholder approval.
     
Rights Offering   The Company is distributing to holders of its common stock, at no charge, one subscription right for every one share of the Company’s common stock that holders owned as of the Record Date.
     
Subscription Privilege   Each subscription right entitles Eligible Participants to purchase, for every one share of common stock they owned as of the Record Date, between 1.02 and 0.68 shares of common stock upon payment of between $3.00 and $4.50 per share, depending on the Subscription Price formula described below.
     
Launch Date   The offering will be launched shortly after the mailing of the proxy statement for the Company’s annual shareholder meeting, which will be held in August 2006. The expected launch date is July 27, 2006.
     
Record Date   The Record Date is expected to be July 27, 2006 at 5:00 p.m., New York City time. Only the Company’s stockholders as of the Record Date (the ‘‘Eligible Participants”) will receive rights to subscribe for shares in the rights offering.
     
Expiration Date   It is expected that the rights would expire at or shortly after the Company’s annual meeting but in no event more than 40 days after the launch date. Rights not exercised by the Expiration Date will be null and void. The Company has the option, with the approval of the Standby Purchasers, to extend the expiration of the rights offering for any reason, for a period not to exceed 15 business days.
     
Subscription Price   Subscription Price will be payable in cash and set at a 20% discount to the average closing price of the Company’s common stock for the 30 trading day period ending July 6, 2006. Notwithstanding the above, at no time shall the Subscription Price be higher than $4.50 per share nor shall it be lower than $3.00 per share. All payments must be cleared on or before the Expiration Date.
     
Transferability of Rights   The subscription rights may not be sold, transferred or assigned.
     
Subscription Commitment of Tontine   Tontine Capital Partners, L.P. (‘‘Tontine”), who, as of June 15, 2006, beneficially owned approximately 9.9% of the Company’s common stock, will agree to act as a standby purchaser in the rights offering in the amount up to 54% of the unsubscribed shares.


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Table of Contents

       
Subscription Commitment of Legg Mason     Legg Mason Investment Trust, Inc. (‘‘Legg Mason”), who, as of June 15, 2006, beneficially owned 0.0% of the Company’s common stock, will agree to act as a Standby Purchaser in the rights offering in the amount up to 36% of the unsubscribed shares.
       
Subscription Commitment of Arklow     Arklow Capital, LLC. (‘‘Arklow”), who, as of June 15, 2006, beneficially owned 4.2% of the Company’s common stock, will agree to act as a Standby Purchaser in the rights offering in the amount up to 10% of the unsubscribed shares.
       
Reallocation of Percentage of Subscription     Tontine, Legg Mason and Arklow reserve the right to agree among themselves to reallocate the percentage of the unsubscribed shares that they shall each purchase (so long as Tontine, Legg Mason and Arklow purchase 100% of the unsubscribed shares in the aggregate).
       
Subscription Commitment Fee     Additional subscription privilege of $50.0 million to be allocated pro rata to Tontine and Legg Mason based on subscription commitments, subject to change of control limitations described below.
       
Additional Subscription Privilege for the Standby Purchasers     The Company is granting Tontine and Legg Mason the right to acquire between 11.1 million and 16.7 million shares of the Company’s common stock at the Subscription Price after completion of the Rights Offering. They will commit to purchase such shares.
       
Reallocation of Percentage of Additional Subscription     Tontine and Legg Mason reserve the right to agree between each other to reallocate the percentage of the additional subscription shares referred to above that they shall each purchase (so long as Tontine and Legg Mason purchase 100% of the additional subscription shares in the aggregate).
       
Change of Control     No purchaser, or group of which that purchaser is a member, may acquire shares in the equity offering that would result in a Change of Control under the Company’s Senior Credit Facility (30% fully-diluted ownership) or Second-Lien Notes agreement (50% of outstanding shares).
       
Subscription Agent     [TBD].
       
Use of Proceeds     Proceeds will be used to provide additional liquidity for working capital, capital expenditures and general corporate purposes.
       
Board of Directors     Tontine shall have the right to nominate 2 directors on the Board reasonably acceptable to the Board, which Board shall consist of not more than 9 members immediately after giving effect to such additional 2 directors; it being understood that the Board shall be free to change the size of the Board after the closing date of the rights offering to the extent permitted by the Company’s certificate of incorporation and by-laws and Delaware law.
       
Registration Rights     Tontine, Legg Mason and Arklow shall have registration rights, which shall consist of an immediate evergreen shelf registration statement, demand registrations if the shelf registration statement is not effective, unlimited Form S-3 registrations so long as the Company is eligible to use such Form and piggyback registration rights. 

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