Exide Technologies is a producer and recycler of lead-acid batteries.

Several purported shareholder class action lawsuits have been filed against Exide and certain of its present and former executive officers and/or directors alleging Defendants violated sections 10(b) and 20(a) of the Exchange Act, and Rule 10b-5, by issuing a series of material misrepresentations to the market during the Class Period.

Specifically, the Complaint alleges that Exide was heavily dependent on financing to support its operations during the Class Period, having emerged from bankruptcy protection in May 2004. The Company had negotiated a $365 million senior secured credit facility which required the Company to comply with several financial covenants, including: (1) that the Company maintain a specified ratio of debt to equity (the “Leverage Ratio Covenant”), and (2) that the Company maintain minimum consolidated earnings before income, taxes, depreciation, amortization (“EBITDA”) (the “EBITDA Covenant”) (collectively, with the Leverage Ratio Covenant, the “Covenants”). Throughout the Class Period, Defendants represented that the Company could maintain compliance with the Covenants because, among other things, they had reorganized Exide’s business, successfully implemented cost-savings measures and increased productivity. In addition, Defendants stated that they had hedged against commodity price fluctuations, including the price of lead, which was the primary material used in the production of batteries. On February 14, 2005, Defendants revealed that the Company was in violation of the Leverage Ratio Covenant, however, assured investors that Exide’s lenders would waive the Leverage Ratio Covenant. Moreover, Defendants emphasized that the Company was in compliance with the EBITDA Covenant, and that it was not at risk of defaulting on the credit facility.

The Complaint further alleges that the truth began to emerge on May 16, 2005. On that day, after the market closed, Defendants issued a press release stating they expected Exide to violate the Covenants for the fiscal year-ended March 31, 2005 as a result of the “impact of commodity costs; the loss of overhead absorption due to an inventory-reduction initiative; other fourth-quarter inventory valuation adjustments; and costs associated with Sarbanes-Oxley compliance efforts.” In reaction to this announcement, the price of Exide stock, which had closed at $11.15 per share on May 16, 2005, fell to an opening price of $5.75 per share the following trading day, representing a one-day decline of $5.40, or 48%, and closed out the day at $6.88 per share on extremely heavy volume of over nine million shares, 50 times the daily average volume. On May 17, 2005, after the market closed, Defendant Gargaro made the following additional shocking revelations: (1) the Company expected to report adjusted EBITDA of $100 million to $107 million for the full-year 2005, and therefore, failed to satisfy the minimum EBITDA Covenant which required minimum EBITDA of $130 million; (2) several “unanticipated and unusual items,” including write-offs of obsolete and discontinued products, had resulted in a reduction of earnings of between $15 million and $20 million; (3) the Company lacked the ability to properly forecast its inventory requirements; and (4) the Company had violated the terms of a contract with a large customer and, consequently, was required to record an adjustment of $1.5 to $2 million. In reaction to this news, the price of Exide shares fell another $1.55, or 22 %, from their closing price of $6.88 on May 17, 2005, to close at $5.33 on May 18, 2005. Defendants were motivated to commit the fraud alleged herein so that Exide could complete a $350 million private placement of senior notes and floating rate convertible senior subordinated notes.

According to the Company’s FORM 10-Q for the quarterly period ended September 30, 2006, on August 29, 2005, District Judge Mary L. Cooper consolidated the Aviva Partners and Jarman cases under the Aviva Partners v. Exide Technologies, Inc. caption, lead docket number 05-3098 (MLC). On March 24, 2006 District Judge Cooper appointed the Alaska Hotel & Restaurant Employees Pension Trust Fund and Lakeway Capital Management co-lead Plaintiffs for the putative class of former Exide stockholders and appointed the law firms of Lerach Coughlin Stoja Geller Rudman & Robbins LLP and Schatz & Nobel, P.C. as co-lead Counsel for the putative class. On May 8, 2006 co-lead Plaintiffs filed their consolidated amended Complaint in which they reiterated the claims described above but purported to state a claim on behalf of those who purchased the Company’s stock between May 5, 2004 and May 17, 2005. Defendants moved to dismiss all claims against them. Discovery is stayed pursuant to the discovery-stay provisions of the Private Securities Litigation Reform Act of 1995.

On March 13, 2007, the Court denied Defendants’ motions to dismiss. Discovery then proceeded. On May 18, 2007, the Plaintiffs filed a motion for class certification. On December 5, 1007, the Court entered a Stipulation and Order certifying the class.

According to an article dated March 30, 2009, automotive battery producer Exide has agreed to pay $13.7 million to settle a consolidated class action alleging the Company deceived investors with sanguine reports shortly after emerging from bankruptcy in 2004. The settlement, submitted Friday for approval by Judge Mary L. Cooper of the U.S. District Court for the District of New Jersey, creates a $13.7 million settlement fund to resolve accusations the battery maker misled investors about its ability to meet covenants associated with loans the Company took on after reorganization.

On April 13, 2009, Judge Mary L. Cooper preliminarily approved the settlement. A Settlement Fairness Hearing is set for June 23, 2009, to determine, among other things, whether the proposed settlement of the Litigation on the terms and conditions provided for in the Stipulation is fair, reasonable, and adequate to the Class and should be approved by the Court.

On June 23, 2009, the Court entered the Order signed by Judge Mary L. Cooper granting the motion to approve the plan of allocation, awarding lead Plaintiff’s Counsel attorneys’ fees and expenses and signing the Final Judgment and Order of Dismissal with Prejudice. The civil case is now terminated.