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Exide Corporation Responds to News Reports of Criminal Investigation In Illinois

7 December 1999

Exide Corporation Responds to News Reports of Criminal Investigation In Illinois

    READING, Pa., Dec. 6 -- Exide Corporation ,
responded today to news reports last week of a federal investigation in
Illinois regarding Sears Roebuck & Co. and Exide.
    A subpoena issued to Sears requested documents related to the wheel
balancing business operated by Sears and the sale of DieHard batteries,
manufactured by Exide, and sold by Sears.
    Though Exide had not been contacted or subpoenaed regarding the inquiry,
the company contacted the United States Attorney's office in Illinois last
week and pledged the company's full cooperation in its probe.
    "We just want to set the record straight," explained Chairman and Chief
Executive Officer Robert A. Lutz.  "We will cooperate -- and have cooperated
-- with any court inquiries into the company's activities.  Additionally, we
informed Sears more than a year ago about these alleged payments," continued
Lutz.
    In response to potential charges cited in news reports, including alleged
illegal payments made by former Exide management and the sale of used
batteries as new through the Sears/Exide relationship, Exide management
emphasized several key points:
    -- No Exide executive or manager alleged to have made any illegal payment
       is presently employed by the company.
    -- Since these and other allegations first came to light in March 1998, as
       a result of an investigation conducted by the Florida Attorney
       General's Office, Exide has replaced its Board of Directors, Chairman
       and Chief Executive Officer, President, other members of management, as
       well as completely restructured its finance department.  In addition,
       the company has expanded its internal audit department and has improved
       its quality audit program for all sales branches.
    -- Exide notified Sears Roebuck & Co. in 1998 of the alleged payments.
       Exide has also brought these and the other issues raised by the Florida
       Attorney General's inquiry to the attention of the Securities and
       Exchange Commission.
    -- The conduct alleged in the reports would result in immediate dismissal
       from Exide if it occurred under the present management.
    -- The company has and will continue to cooperate with all authorities
       investigating former management's conduct.  The company is also
       pursuing legal action against former senior executives related in part,
       to the alleged improper conduct.
    John R. Van Zile, Exide general counsel, said, "The current management
team at Exide has changed both the culture and the personnel allegedly
responsible for these events.  Exide is committed to supplying its customers
with the highest quality products and services and will not tolerate the type
of activity alleged in the news releases.  It is unfortunate that some of the
articles last week did not reflect all of the relevant facts including a
historical perspective on the alleged events and the company's position on the
charges."
    Exide Corporation, with annual revenues of approximately $2.4 billion and
operations in 19 countries, is the world's largest manufacturer of automotive
and industrial lead-acid batteries.  Further information about Exide's
businesses and products is available at http://www.exideworld.com.