December 20, 2007

Leonard P. Kiely
846 Fulton Avenue
Lansdale, PA 19422

Dear Leonard:

            C&D  Technologies,  Inc., a Delaware  corporation  (the  "Company"),
wishes to  continue  to employ  you in an  executive  capacity  and the  Company
desires to encourage such employment by providing certain protections for you by
entering  into  this  Agreement  with you,  in return  for which you agree to be
employed by the Company on the terms set forth  herein,  to refrain from certain
competitive  activity and to provide the Company with  certain  assurances  upon
your departure.  In consideration of same, the Company agrees to employ you, and
you agree to accept such employment, under the following terms and conditions:

            1.    Term of Employment. Your employment under this Agreement shall
continue in effect  until either party shall give to the other party at least 30
days prior written  notice (or such other notice  period as may be  specifically
provided  for in  this  Agreement)  of the  termination  of  this  Agreement  (a
"Termination  Notice"),  or until it is terminated in accordance with Section 8.
If a Termination Notice is given by either party the Company shall,  without any
liability to you, have the right,  exercisable  at any time after such notice is
sent to elect any other  person to the  office or  offices in which you are then
serving and to remove you from such office or offices.  The period  during which
you are employed under this Agreement is hereafter referred to as the "Term."

            2.    Compensation and Benefits.

            (a)   During the Term, you shall receive a salary for performance of
your  obligations  under this Agreement at an initial rate of $310,000 per year,
payable in such manner as is consistent with the Company's payroll practices for
executives  and subject to increase (but not decrease) by the Board of Directors
in its sole discretion. Such salary, as it may be adjusted from time to time, is
hereinafter referred to as the "Base Salary."

            (b)   During the Term, you shall have the benefit of and be entitled
to  participate  in such employee  benefit plans and programs,  including  life,
disability and medical insurance,  savings,  retirement and other similar plans,
as the Company now has or  hereafter  may  establish  from time to time,  and in
which  you are  entitled  to  participate  pursuant  to the terms  thereof.  The
foregoing,  however,  shall not be construed to require the Company to establish
any such plans or to prevent the Company from modifying or terminating  any such
plans, and no such action or failure thereof shall affect this Agreement.

<PAGE>

            (c)   During the Term, you shall be entitled (i) to participate in
the Company's  Management  Incentive  Compensation Plan or any successor thereto
each year in accordance  with criteria and for amounts  approved by the Board of
Directors, except as may otherwise be delegated to the Compensation Committee or
other relevant committee, and (ii) to be granted options to acquire stock of the
Company  or  other  equity  awards,  to the  extent  (if  any)  approved  by the
Compensation  Committee or the relevant  committee,  under the  Company's  stock
option or equity  incentive  plans in effect from time to time (all such options
and equity awards,  "Awards").  Without limiting the foregoing, you shall have a
minimum targeted bonus for each fiscal year of 35% of your Base Salary (with the
actual payment of any bonus being dependent on your or the Company's achievement
of targeted objectives except as otherwise set forth in this Agreement). Each of
the actual annual bonuses paid to you each year is hereinafter referred to as an
"Annual Bonus."

            (d)   You shall be entitled to payments and  benefits in  connection
with a Change of Control  Termination  (as  defined in Exhibit A hereto)  and to
certain  additional  payments if you are subjected to the federal  excise tax on
excess parachute payments, as more fully set forth in Exhibit A.

            (e)   To the extent  that any payment  hereunder  or under any plan,
program or policy is determined to be nonqualified deferred compensation that is
noncompliant  with Section 409A ("Section 409A") of the Internal Revenue Code of
1986, as amended (the "Code"),  and is therefore subject to additional taxes and
penalties,  the Company shall provide you with additional payments as more fully
set forth in Exhibit A. Any reference to Section 409A shall be deemed to include
any applicable guidance that has been provided thereunder.

            (f)   You shall be entitled to a minimum of four weeks of vacation
each calendar year during the Term. To the extent that Company  policy  provides
additional vacation days, you shall also be entitled to such additional vacation
days.  Any unused  vacation  days in any one year  shall  carry over to the next
calendar year.

            (g)   The Company  will  provide  you at its expense  with an annual
physical examination each year during the Term.

            3.    Duties.

            (a)   During the Term,  you shall serve and the Company shall employ
you as the Vice President and Chief Operating Officer of the Company,  with such
executive duties and responsibilities consistent with such positions and stature
as the Chief  Executive  Officer of the Company may from time to time determine.
Your  duties may be changed  at any time and from time to time  hereafter,  upon
mutual  agreement,  consistent  with the office or offices in which you serve as
deemed necessary by the Chief Executive Officer of the Company. You shall report
to, and act under the general  direction of, the Chief Executive  Officer of the
Company.  You shall use your best efforts to carry out the  instructions  of the
Chief  Executive  Officer of the  Company.  You also agree to perform such other
services  and  duties  consistent  with the  office or  offices in which you are
serving from time to time and those responsibilities as may from time to time be
prescribed  by the Board of  Directors.  You also  agree to serve as an  officer
and/or  director  of the Company  and/or any of the  Company's  other  direct or
indirect subsidiaries, in all cases in

                                       -2-

<PAGE>

conformity  with the  organizational  documents and the policies of the Board of
Directors of each such subsidiary,  without  additional  compensation.  You will
review and agree to comply  with the  Company's  then-current  Code of  Business
Conduct to the same extent required for other United  States-based  employees of
the Company.  You will perform all of your  responsibilities  in compliance with
all applicable laws.

            (b)   During the Term, you shall devote your entire business time
and energies  during  normal  business  hours to the business and affairs of the
Company and its  subsidiaries.  Nothing in this  Section 3 shall be construed as
prohibiting  you from investing your personal assets in businesses in which your
participation  is solely  that of a passive  investor  in such form or manner as
will not violate  Section 5 hereof or require  any  services on your part in the
operation  or  affairs  of  those  businesses.   You  may  also  participate  in
philanthropic  or civic  activities as long as they do not materially  interfere
with  your  performance  of your  duties  hereunder.  Service  on any  board  of
directors other than those of the Company and its subsidiaries must be approved,
in advance, by the Board of Directors of the Company.

            (c)   During the Term, you shall be subject to the Company's  rules,
practices and policies applicable to the Company's senior executive employees.

            4.    Expenses.  The Company shall  reimburse you for all reasonable
expenses incurred by you during the Term in connection with your employment upon
presentation  of  appropriate  documentation  therefor  in  accordance  with the
Company's  expense  reimbursement  practices.  In the event  during the Term the
Company's principal executive offices are relocated to a location that increases
your commute to work by more than 35 miles,  the Company  shall  reimburse  your
moving  expenses   (including   reasonable  costs  relating  to  interim  living
accommodations).

            5.    Restrictive Covenants.

            (a)   During the Term, and for the applicable Restricted Period (as
defined below)  thereafter,  you shall not,  without the written  consent of the
Board of Directors,  directly or  indirectly,  become  associated  with,  render
services  to,  invest  in,  represent,  advise or  otherwise  participate  as an
officer,  employee,  director,  stockholder,  partner  or  agent  of,  or  as  a
consultant for, any business  anywhere in the world that is competitive with the
business  in which the  Company  is engaged  or in which the  Company  has taken
affirmative  steps to  engage  (a  "Competitive  Business")  as of the time your
employment with the Company ceases;  provided,  however, that (i) nothing herein
shall  prevent you from  investing in up to 5% of the  securities of any company
listed on a  national  securities  exchange  or quoted on the  NASDAQ  quotation
system,  as long as your  involvement  with any such company is solely that of a
stockholder,  and (ii)  nothing  herein is  intended  to prevent  you from being
employed by, or  otherwise  rendering  services  to, any  business  other than a
Competitive  Business  following the  termination  of your  employment  with the
Company.  The Restricted  Period shall be the one-year period following the date
your employment terminates.  You acknowledge that the provisions of this Section
5 are reasonable in light of the Company's worldwide business operations and the
position in which you will serve at the Company and that the provisions will not
prevent you from obtaining employment after the termination of this Agreement.

                                       -3-

<PAGE>

            (b)   The parties hereto intend that the covenant  contained in this
Section 5 shall be deemed a series of separate  covenants  for each  appropriate
jurisdiction.  If, in any judicial  proceeding,  a court shall refuse to enforce
all of the separate covenants deemed included in this Section 5 on grounds that,
taken together,  they cover too extensive a geographic  area, the parties intend
that those covenants (taken in order of the least populous jurisdictions) which,
if eliminated,  would permit the remaining  separate covenants to be enforced in
that proceeding, shall, for the purpose of such proceeding, be deemed eliminated
from the provisions of this Section 5.

            6.    Confidentiality, Noninterference and Proprietary Information.

            (a)   In the course of your employment by the Company  hereunder you
will have access to  Confidential  or  Proprietary  Data or  Information  of the
Company.  You shall not at any time divulge or  communicate  to any person,  nor
shall you direct any Company  employee to divulge or  communicate  to any person
(other than to a person bound by  confidentiality  obligations  similar to those
contained  herein  and  other  than  as  necessary  in  performing  your  duties
hereunder)  or use to the  detriment  of the  Company or for the  benefit of any
other person,  any of such  Confidential  or  Proprietary  Data or  Information,
except to the extent the same (i) becomes  publicly  known other than  through a
breach of this  Agreement by you, (ii) was known to you prior to the  disclosure
thereof by the Company to you from a source that was entitled to disclose it, or
(iii) is  subsequently  disclosed  to you by a third  party  who  shall not have
received it under any obligation of confidentiality to the Company. For purposes
of this Agreement,  the term  "Confidential  or Proprietary Data or Information"
shall mean data or information not generally available to the public,  including
personnel information,  financial  information,  customer lists, supplier lists,
product  and  tooling  specifications,  trade  secrets,  information  concerning
product  composition  and  formulas,  tools and dies,  drawings and  schematics,
manufacturing processes, information regarding operations, systems and services,
know-how,  computer  and any  other  electronic,  processed  or  collated  data,
computer programs, and pricing, marketing, sales and advertising data.

            (b)   You  shall  not,  during  the  Term  and  for  the  applicable
Restricted Period after the termination of your employment with the Company, for
your own account or for the account of any other  person,  (i) solicit or divert
to any  Competitive  Business any individual or entity who is then a customer of
the Company or any  subsidiary or affiliate of the Company or who was a customer
of the Company or any subsidiary or affiliate during the preceding  twelve-month
period,  (ii) employ,  retain as a consultant,  attempt to employ or retain as a
consultant,  or solicit or assist  any  Competitive  Business  in  employing  or
retaining as a consultant  any individual who is then an employee of the Company
or any  subsidiary  or  affiliate  or who was  employed  by the  Company  or any
subsidiary  or affiliate  during the  preceding  twelve-month  period,  or (iii)
otherwise interfere in any material respect with the Company's relationship with
any of its suppliers,  customers,  employees or consultants;  provided, however,
that you shall not be prohibited  from  contacting  suppliers or customers after
termination of your  employment  with regard to matters that do not violate your
non-competition  or confidentiality  obligations  contained in Sections 5(a) and
6(a) or interfere in any material respect with the Company's  relationship  with
such parties.

                                       -4-

<PAGE>

            (c)   You shall at all times  promptly  disclose to the Company,  in
such form and manner as the Company  reasonably  may  require,  any  inventions,
improvements or procedural or  methodological  innovations,  programs,  methods,
forms,  systems,  services,  designs,  marketing  ideas,  products or  processes
(whether or not capable of being trademarked, copyrighted or patented) conceived
or developed  or created by you during and in  connection  with your  employment
hereunder  and  which  relate  to the  business  of the  Company  ("Intellectual
Property").  All such  Intellectual  Property  shall be the sole property of the
Company.  You shall execute such instruments and perform such acts as reasonably
may be  requested  by the  Company to transfer to and perfect in the Company all
legally  protectable  rights in such  Intellectual  Property.  If the Company is
unable for any reason to secure your signature on such  instruments,  you hereby
irrevocably  appoint the Company and its  officers and agents as your agents and
attorneys-in-fact  to execute  such  instruments  and to do such things with the
same legal force and effect as if executed or done by you.

            (d)   All written, electronic and other tangible materials,  records
and documents made by you or coming into your possession  during your employment
concerning any products, processes or equipment,  manufactured, used, developed,
investigated  or considered by the Company or otherwise  concerning the business
or affairs of the Company,  shall be the sole property of the Company,  and upon
termination of your  employment,  or upon the request of the Company during your
employment,  you  shall  deliver  the same to the  Company.  In  addition,  upon
termination  of your  employment,  or upon  request of the  Company  during your
employment,  you shall deliver to the Company all other Company property in your
possession or under your control,  including Confidential or Proprietary Data or
Information and all Company credit cards and computer and telephone equipment.

            7.    Equitable Relief.  With respect to the covenants  contained in
Sections 5 and 6 of this Agreement,  you acknowledge  that any remedy at law for
any breach of said covenants may be inadequate and that the Company, in addition
to its rights at law,  shall be entitled to  specific  performance  or any other
mode of injunctive or other equitable relief to enforce its rights hereunder.

            8.    Termination  of  Term.  The  Term  shall  terminate  upon  the
following terms and conditions:

            (a)   The Term shall automatically terminate upon your death.

            (b)   The  Term  may  be   terminated   by  the  Company  upon  your
Disability.  For  purposes  of this  Agreement,  "Disability"  shall  mean  your
inability,  due to reasons of physical or mental health, to discharge properly a
substantial  portion of your duties  hereunder  for any 180 days (whether or not
consecutive)  during any period of 365  consecutive  days,  as determined in the
opinion of a physician  reasonably  satisfactory to both you and the Company. If
the parties do not agree on a mutually  satisfactory  physician  within ten days
after written demand by one or the other,  a physician  shall be selected by the
president of the  Pennsylvania  Medical  Association,  and the physician  shall,
within 30 days thereafter,  make a determination as to whether Disability exists
and certify the same in writing. The services of the physician shall be paid for
by the  Company.  You  shall  fully  cooperate  with  the  examining  physician,
including submitting

                                       -5-

<PAGE>

yourself to such  examinations  as may be  requested  by the  physician  for the
purpose of determining whether you are disabled.

            (c)   The Term shall terminate immediately if the Company terminates
your employment for Cause.  For purposes of this Agreement,  "Cause" shall exist
upon a finding by the Board of Directors of any of the following:  (i) an act or
acts of willful  material  misrepresentation,  fraud or  dishonesty  by you that
results in the  personal  enrichment  of you or another  person or entity at the
expense of the Company;  (ii) your  admission,  confession  or conviction of any
felony or any other crime or offense  involving  misuse or  misappropriation  of
money or other  property;  (iii) any act involving  gross moral turpitude by you
that adversely and materially affects the Company; (iv) your continued breach of
any of your material  obligations under this Agreement 30 days after the Company
has given you notice thereof in reasonable  detail,  if such breach has not been
cured by you during such period; or (v) your willful  misconduct with respect to
your duties or gross misfeasance of office.

                  For   purposes of this Section 8(c), no act or failure to act,
on your part shall be considered  "willful"  unless it is done, or omitted to be
done,  by you in bad faith or  without  reasonable  belief  that your  action or
omission was in the best  interests of the Company.  Any act, or failure to act,
based upon authority given pursuant to a resolution duly adopted by the Board of
Directors  or  based  upon  the  advice  of  counsel  for the  Company  shall be
conclusively  presumed to be done,  or omitted to be done,  by you in good faith
and in the best interests of the Company.  Your  termination of employment shall
not be deemed to be for Cause unless prior to such termination you have received
a copy of a resolution duly adopted by the  affirmative  vote of not less than a
majority of the disinterested  membership of the Board of Directors at a meeting
of such Board of Directors  called and held for such purpose  (after  reasonable
notice is provided to you and you are given an  opportunity  to be heard  before
such Board of  Directors),  stating  the clause  pursuant  to which the Board of
Directors  has  effected  your  termination.  If you  appeal  this  decision  to
arbitrators  pursuant to Section 23, the arbitrators shall be required to make a
de novo  review  of the  circumstances  of your  termination  and  independently
determine whether facts exist to support such termination.

            (d)   The Term shall terminate if your employment is terminated in a
Change of Control Termination (as defined in Exhibit A).

            (e)   The Term shall  terminate  upon the  expiration  of the thirty
(30) day period after  delivery of a  Termination  Notice if your  employment is
terminated by the Company  without Cause or voluntarily by you (a termination by
you not due to Breach or a termination by you without Good Reason).

            9.    Compensation  Upon  Termination of Employment.  Separation pay
shall be paid in accordance with the schedule set forth below upon a termination
of employment  that  constitutes  a  "separation  from service" as defined under
Section 409A  ("Separation  from Service").  If a termination of employment does
not constitute a Separation  from Service,  separation pay shall be paid at such
later  time  that a  Separation  from  Service  occurs.  For  purposes  of  this
Agreement,  the default  definition of  Separation  from Service under the Final
Regulations promulgated under Section 409A shall be employed.

                                       -6-

<PAGE>

         (a) For  Any Reason. Upon  termination  of  employment: (i) you or your
estate,  as applicable,  shall be paid within  fifteen  business days after your
date of termination  (A) your accrued and unpaid Base Salary through the date of
termination,  (B) any  then-vested  and unpaid  Annual Bonus or other  incentive
compensation  that you may have earned  pursuant to the terms of any  applicable
incentive  compensation  or bonus plan of the Company with respect to any fiscal
year or other  performance  period  completed prior to your date of termination,
and (C) any  then-unused  accrued  vacation pay;  (ii) you,  your  beneficiaries
and/or  your  estate,  as  applicable,  shall be entitled  to any  payments  and
benefits under the benefits and incentive  plans and perquisite  programs of the
Company,  in accordance with the respective  terms of those plans and perquisite
programs (including without  limitation,  any conversion option available to you
under the Company's life insurance  plan(s));  and (iii) you or your estate,  as
applicable,  shall be reimbursed  for your business  expenses  incurred prior to
termination in accordance with Section 4 above.

         (b) Change of Control  Termination. Upon the termination of  employment
by reason of a Change of Control Termination, you shall receive the payments and
benefits set forth in Exhibit A.

         (c) Termination  without  Cause  or  Breach   Termination.   Upon  the
termination  of  employment  that  is not  by  reason  of a  Change  of  Control
Termination,  but results from either (1) a termination  by the Company  without
Cause (excluding a termination due to death or Disability), or (2) a termination
by you which is a Breach  Termination (as defined below), you shall also receive
the  following  payments;  provided,  however,  that any payment made under this
Section  9(c) shall be reduced by any amount paid or payable to you with respect
to the same type of payment  under any other plan  maintained  by the Company to
avoid duplication of payments:

                  (i)   The Company  shall pay you an amount  equal to your Base
            Salary at the rate in effect on the date of termination.  Payment of
            such amount will commence in the form of normal payroll installments
            through  the  period  ending  as of  the  end of  the  second  month
            following  the  later  of  (A)  the  calendar  year  in  which  your
            termination  of  employment  occurs or (B) the  taxable  year of the
            Company in which your termination of employment  occurs. The balance
            of such payments  shall be made in a single lump sum payable  within
            the fifteen day period immediately following the end of the month in
            which installment payments are to cease.

                  (ii)  If you  terminate  employment  on or after  May 1st of a
            fiscal  year,  you shall be  entitled  to an  Annual  Bonus for that
            fiscal year,  based on the actual bonus earned under the  applicable
            bonus plan for the fiscal  year,  pro-rated to reflect the number of
            business  days during the fiscal year in which you were  employed by
            the  Company.  This bonus shall be paid only when and if bonuses are
            paid to other senior  executives of the Company for such year,  but,
            if any such  bonus is  payable,  it shall be paid no later  than the
            15th  day of the  third  month  following  the  earlier  of (A)  the
            calendar year in which your termination of employment  occurs or (B)
            the  taxable  year of the  Company  in  which  your  termination  of
            employment occurs.

                                       -7-

<PAGE>

            As  used  in this  Section  9(c),  a  "Breach  Termination"  means a
termination of your employment by you by written Termination Notice given to the
Company  within 90 days  after the  occurrence  of any action or  inaction  that
constitutes  a material  breach by the Company of the  Agreement.  A Termination
Notice for a Breach  Termination  shall indicate the specific action or inaction
that constitutes the material breach,  shall set forth in reasonable  detail the
facts and circumstances  claimed to provide a basis for the Breach  Termination,
and shall provide the Company a minimum of 30 days in which to remedy such facts
or circumstances. Your failure to set forth in such Termination Notice any facts
or circumstances which contribute to the showing of Breach Termination shall not
constitute  your waiver of any right  hereunder or preclude  you from  asserting
such fact or  circumstance in enforcing your rights  hereunder.  The Termination
Notice for a Breach Termination shall provide for a date of termination not less
than 30 nor more than 60 days after the date such Termination Notice is given.

            Notwithstanding the foregoing, should a termination of employment by
the Company without Cause or a Breach  Termination occur within six months prior
to, or within two years after, a Change of Control,  your  termination  shall be
considered  a Change of Control  Termination  and you shall vest in the payments
and  benefits  set forth in Exhibit A. Any such  payments or  benefits  shall be
offset  by any  payments  or  benefits  that you may have been  already  paid or
received due to the  occurrence of the  termination  of employment  prior to the
Change of Control, and shall be paid in accordance with Exhibit A.

            (d)   The  payment  by  the  Company  of  any  compensation  or  the
provision of benefits,  if any,  pursuant to Section 9(c) and Exhibit A shall be
conditioned on your execution, without revocation, of a Release (a "Release") in
a form  provided  by and  acceptable  to the  Company.  Such  Release  shall  be
substantially in the form of Exhibit B hereto but may be modified by the Company
in its sole  discretion  as it deems  appropriate  to reflect  changes in law or
circumstances arising after the date of this Agreement;  provided, however, that
no such  modification  shall reduce your rights or increase your  obligations to
the Company over those  contemplated in this  Agreement,  including the Exhibits
hereto.  No Release shall be required for any benefits to which you are entitled
under the terms of any plan.

            10.   Indemnification.  At all times, prior to, on or after a Change
of Control,  the  Company  shall  indemnify  you for your acts as an officer and
director to the fullest  extent  permitted by law.  Further,  the Company  shall
provide you with advance attorneys fees and expenses to you as they are incurred
subject to presentation of invoices.

            11.   Representations. You hereby represent and warrant that you are
not subject to any  employment  agreement,  non-competition  or  confidentiality
agreement or other  commitment  that either  would be violated by your  entering
into or performing your obligations  under this Agreement or that would restrict
in any manner or interfere with the performance of your  obligations  under this
Agreement.  You hereby further  represent and warrant that you have not revealed
to the Company or any employee of the Company any  confidential  information  of
any former employer, and you agree that you will not do so in the future.

            12.   Entire Agreement; Modification;  Construction. This Agreement,
together  with the  Exhibits  hereto,  all employee  benefit  plans in which you
participate, and any outstanding awards, including,  without limitation,  equity
awards, constitute the full and complete

                                       -8-

<PAGE>

understanding   of  the  parties,   and  supersede  all  prior   agreements  and
understandings, oral or written, between the parties, including, but not limited
to the offer  letter  dated  April 3, 2006 and the  employment  agreement  dated
February 1, 2006,  with  respect to the  subject  matter  hereof.  Exhibit A and
Exhibit  B are  hereby  incorporated  by  reference  and  made  a part  of  this
Agreement.  Each party to this Agreement  acknowledges that no  representations,
inducements, promises or agreements, oral or otherwise, have been made by either
party,  or anyone  acting on behalf of either  party,  that are not set forth or
referred to herein.  This  Agreement may not be modified or amended except by an
instrument in writing signed by the parties.

            13.   Severability.  Any term or provision of this Agreement that is
held to be  invalid  or  unenforceable  in any  jurisdiction  shall,  as to that
jurisdiction,  be ineffective to the extent that invalidity or  unenforceability
without rendering invalid or unenforceable the remaining terms and provisions of
this Agreement or affecting the validity or  enforceability  of any of the terms
or provisions of this Agreement in any other jurisdiction.

            14.   Waiver of Breach.  The  waiver by either  party of a breach of
any  provision  of  this  Agreement,  which  waiver  must  be in  writing  to be
effective,  shall not operate as or be construed  as a waiver of any  subsequent
breach.

            15.   Notices.  All notices  hereunder shall be in writing and shall
be sent by messenger or by certified or registered mail, postage prepaid, return
receipt  requested,  if to you, to your residence set forth above, and if to the
Company,  to the Vice  President-Human  Resources,  at the Company's address set
forth above,  or to such other address as either party to this  Agreement  shall
specify to the other.

            16.   Assignability;  Binding  Effect.  This Agreement  shall not be
assignable by either party,  except that it may be assigned by the Company to an
acquirer  of all or  substantially  all of the  assets of the  Company  or other
successor  to the  Company,  subject  to your  rights  arising  from a Change of
Control as provided in Exhibit A and your other rights hereunder. This Agreement
shall  be  binding   upon  and  inure  to  the   benefit  of  you,   your  legal
representatives,  heirs and distributees, and shall be binding upon and inure to
the benefit and detriment of the Company, its successors and assigns. Prior to a
Change of Control, any successor to the Company shall be required to acknowledge
in writing its  obligations  hereunder as successor to the Company to the extent
that the  Company  has not  fulfilled  its  obligations  prior to the  Change of
Control  or any  amounts  or  benefits  are still due to you after the Change of
Control.

            17.   No Mitigation Required.  No Offset.  Following any termination
of your  employment  hereunder,  you  shall  have no  obligation  to seek  other
employment but shall not be prohibited from doing so, and no  compensation  paid
to you as the result of any other employment shall reduce any payment or benefit
required to be provided by the Company hereunder. Not in limitation of any other
rights which the Company may have,  including without limitation,  injunctive or
other  equitable  relief,  in  the  event  of a  violation  by you of any of the
covenants  set forth in Section 5,  Section 6 or Section 19 hereof,  the Company
may cease paying any compensation  and benefits,  if any, to you under Section 9
hereof and may seek recovery of any such amount paid to you during any period in
which you were in violation of the provisions of Section 5, Section 6 or Section
19. The cessation and/or recovery of any of the

                                       -9-

<PAGE>

payments  described in Section 9(c) in connection  with any such violation shall
not be deemed to be evidence  that monetary  damages are  sufficient to cure any
damage to the Company for any such violation.

            18.   Governing  Law.  All  questions  pertaining  to the  validity,
construction, execution and performance of this Agreement shall be construed and
governed  in  accordance  with the  laws of the  Commonwealth  of  Pennsylvania,
without giving effect to the conflicts or choice of law provisions thereof.

            19.   Nondisparagement.  You  agree  not to  publicly  or  privately
disparage the Company,  its personnel,  products or services  either during your
employment by the Company or during the Restricted Period.

            20.   Survival.  All of the  provisions  of this  Agreement  that by
their  terms are to be  performed  or that  otherwise  are to  endure  after the
termination  of this  Agreement  and/or  the  termination  of  your  employment,
including,  without  limitation,  Sections 5, 6, 7, 10, 17 and 19, shall survive
the  termination  of your  employment  and  shall  continue  in  effect  for the
respective periods therein provided or contemplated.

            21.   Headings.  The headings in this Agreement are intended  solely
for convenience of reference and shall be given no effect in the construction or
interpretation of this Agreement.

            22.   Counterparts.  This  Agreement  may  be  executed  in  several
counterparts,  each of which shall be deemed to be an original  but all of which
together shall constitute one and the same instrument.

            23.   Dispute  Resolution.  In the event of any claim or controversy
arising out of or relating to this Agreement or the  performance,  construction,
interpretation,  enforcement  or breach hereof  (excluding  injunctive and other
equitable relief regarding a dispute over the covenants contained in Sections 5,
6, and 19 hereof) (a "dispute"), the parties shall settle disputes in accordance
with this Section 23.

            (a)   Notice and Selection of  Arbitrators.  The parties shall first
attempt to settle any disputes amicably between themselves.  Should they fail to
do so,  either  party may,  upon written  demand from the claiming  party of the
specific nature of any purported  claims and the amount of damages  attributable
to each such  claim,  served  upon the  other,  submit  such  dispute to binding
arbitration.  The arbitration  panel shall consist of three  arbitrators,  shall
take place in  Philadelphia,  Pennsylvania  and shall proceed in accordance with
the employment dispute resolution rules of the American Arbitration  Association
("AAA").

            Within 15 days after the  commencement of  arbitrations,  each party
shall select one arbitrator  from a list of  arbitrators  provided by the AAA. A
third neutral arbitrator shall be designated by the arbitrators  selected by the
parties within 15 days of their appointment. In the event that any arbitrator is
not appointed within the prescribed time period,  then either party may apply to
the AAA for the  appointment of such  arbitrator.  Prior to the  commencement of
hearings, each of the arbitrators appointed shall provide an oath or undertaking
of impartiality.

                                      -10-

<PAGE>

            (b)   Hearings.   After  the  arbitrators  have  been  appointed  as
provided  above,  the  arbitrators  shall  hold  such  meetings  as a party  may
reasonably  request and at such  meetings  hear and consider any evidence that a
party  desires to  present.  Within 60 days after the  appointment  of the third
arbitrator, the arbitrators shall make their determination.

            (c)   Determinations.   The  determination  of  a  majority  of  the
arbitrators shall be final and binding on the parties, regardless of whether one
of  the  parties  fails  or  refuses  to  participate  in the  arbitration.  The
arbitrators  shall  have the power and  authority  to grant any remedy or relief
they deem just and equitable,  including injunctive relief, specific performance
(excluding,  however,  equitable  relief  regarding a dispute over the covenants
contained in Sections 5, 6 and 19 hereof),  and reasonable costs and expenses of
such  arbitration  and  attorneys'  fees.  Absent  any  specific  order  of  the
arbitrators,  the costs and expenses of the arbitration shall be paid equally by
the  parties.  The  arbitration  award,  decree or order shall be in writing and
shall be  accompanied  by a  reasoned  opinion.  The award may be entered in any
court of competent  jurisdiction,  and any judgment,  decree or order entered in
any such court and any related  orders may be  enforced  as any other  judgment,
decree or order of such court.  The  arbitration  proceedings and all materials,
submissions and documents relating thereto shall be confidential,  and except as
may be  required  by law  neither a party nor an  arbitrator  may  disclose  the
existence,  contents or results of any arbitration hereunder without the consent
of all parties  hereto.  All disputes  shall be resolved in accordance  with the
laws of the Commonwealth of Pennsylvania.

            (d)   Qualifications  of  Arbitrators.  Any arbitrator  chosen by or
through the AAA shall be chosen from a class of disinterested  experts qualified
by education, training and/or experience to resolve the particular issue(s) in a
dispute in an informed and efficient manner.

            (e)   Preservation  of  Remedies.   Notwithstanding   the  preceding
binding  arbitration  provisions,   the  parties  agree  to  preserve,   without
diminution, certain remedies that any party may exercise before, during or after
an  arbitration  proceeding  is  brought.  The  parties  shall have the right to
proceed in any court of proper  jurisdiction  or by  self-help  to  exercise  or
prosecute  the following  remedies,  as  applicable:  obtaining  provisional  or
ancillary remedies,  including injunctive and other equitable relief with regard
to disputes over the covenants contained in Sections 5, 6 and 19 hereof.

                                      -11-

<PAGE>

            If    you are in  agreement  with  the  foregoing,  please  sign the
duplicate original in the space provided below and return it to the Company.

                                      C&D TECHNOLOGIES, INC.

                                      By: /s/ Jeffrey A. Graves
                                          --------------------------
                                             Jeffrey A. Graves
                                      Title: President & Chief Executive Officer

Agreed as of the date
above written:

/s/ Leonard P. Kiely
---------------------------------
Leonard P. Kiely

                                      -12-

<PAGE>

                                    EXHIBIT A
                    TO EMPLOYMENT AGREEMENT (THE "AGREEMENT")
                        OF LEONARD P. KIELY ("EXECUTIVE")

(Capitalized terms used herein and not otherwise defined have the meanings given
to them in the Agreement.)

      I.    Change of Control  Termination.  A "Change  of Control  Termination"
            means the  occurrence  of any of the  following  within  six  months
            before or within 24 months  after a Change of  Control  (as  defined
            below):   (a)  the  Executive's   employment  with  the  Company  is
            terminated by the Executive pursuant to (1) a Breach Termination, if
            the  termination  occurs  within  six  months  prior to a Change  of
            Control, or (2) a Termination for Good Reason (as defined below), if
            the  termination  occurs  after  a  Change  of  Control;  or (b) the
            Executive's employment with the Company is terminated by the Company
            for any reason other than death, Disability or for Cause.

      II.   Certain Other Definitions.

                  (a) Change of  Control.  For  purposes  of  the  Agreement,  a
            "Change of Control" shall mean the first to occur of:

                        1.    The acquisition by any individual, entity or group
                        (within the  meaning of Section  13(d)(3) or 14(d)(2) of
                        the  Securities  Exchange  Act of 1934,  as amended (the
                        "Exchange  Act")) (a "Person") of  beneficial  ownership
                        (within the meaning of Rule 13d-3  promulgated under the
                        Exchange   Act)  of  30%  or  more  of  either  (A)  the
                        then-outstanding  shares of common  stock of the Company
                        (the  "Outstanding  Company  Common  Stock")  or (B) the
                        combined  voting  power of the  then-outstanding  voting
                        securities of the Company  entitled to vote generally in
                        the  election of  directors  (the  "Outstanding  Company
                        Voting  Securities");   provided,   however,  that,  for
                        purposes  of  this   Section   II(a)1,   the   following
                        acquisitions  shall not  constitute a Change of Control:
                        (i) any acquisition directly from the Company,  (ii) any
                        acquisition by the Company, (iii) any acquisition by any
                        employee  benefit plan (or related  trust)  sponsored or
                        maintained   by  the   Company  or  any   majority-owned
                        subsidiary of the Company,  or (iv) any  acquisition  by
                        any corporation  pursuant to a transaction that complies
                        with  Subsections  (A),  (B) and (C) of  Section  II(a)3
                        below.  Separation payments that constitute nonqualified
                        deferred  compensation set forth in this Exhibit A shall
                        be  paid  upon a  Change  in  Control  Termination  that
                        constitutes a Separation  from Service.  For purposes of
                        this Exhibit A, the default  definition  of  "Separation
                        from Service"  under the Final  Regulations  promulgated
                        under Section 409A shall be employed.

                        2.    Individuals who, as of the date hereof, constitute
                        the Board of Directors  (the  "Incumbent  Board") cease,
                        for any reason, to constitute at least a majority of the
                        Board  of  Directors;   provided,   however,   that  any
                        individual becoming a director subsequent to the date of
                        the Agreement whose election, or nomination for election
                        by the Company's stockholders, was approved by a vote of
                        at least

                                       A-1

<PAGE>

                        two-thirds  of  the  directors   then   comprising   the
                        Incumbent  Board  shall be  considered  as  though  such
                        individual  were a member of the  Incumbent  Board,  but
                        excluding,  for this purpose,  any such individual whose
                        initial  assumption  of office  occurs as a result of an
                        actual or  threatened  election  contest with respect to
                        the  election or removal of directors or other actual or
                        threatened  solicitation of proxies or consents by or on
                        behalf of a Person other than the Board of Directors.

                        3.    Consummation   of   a   reorganization,    merger,
                        statutory    share   exchange,    recapitalization    or
                        consolidation or similar corporate transaction involving
                        the Company or any of its subsidiaries,  a sale or other
                        disposition of all or substantially all of the assets of
                        the Company,  or the  acquisition  of assets or stock of
                        another entity by the Company or any of its subsidiaries
                        (each, a "Business  Combination"),  in each case unless,
                        following   such  Business   Combination,   (A)  all  or
                        substantially  all of the  individuals and entities that
                        were the beneficial  owners of the  Outstanding  Company
                        Common  Stock  and  the   Outstanding   Company   Voting
                        Securities    immediately   prior   to   such   Business
                        Combination  beneficially  own,  directly or indirectly,
                        more than 50% of the  then-outstanding  shares of common
                        stock   and   the   combined   voting   power   of   the
                        then-outstanding  voting  securities  entitled  to  vote
                        generally in the election of directors,  as the case may
                        be, of the  corporation  resulting  from  such  Business
                        Combination    (including,    without   limitation,    a
                        corporation that, as a result of such transaction,  owns
                        the Company or all or substantially all of the Company's
                        assets   either   directly   or  through   one  or  more
                        subsidiaries) in  substantially  the same proportions as
                        their  ownership  immediately  prior  to  such  Business
                        Combination of the Outstanding  Company Common Stock and
                        the Outstanding  Company Voting Securities,  as the case
                        may  be,  (B)  no  Person   (excluding  any  corporation
                        resulting from such Business Combination or any employee
                        benefit  plan (or related  trust) of the Company or such
                        corporation  resulting  from such Business  Combination)
                        beneficially owns,  directly or indirectly,  30% or more
                        of, respectively,  the then-outstanding shares of common
                        stock of the  corporation  resulting  from such Business
                        Combination   or  the  combined   voting  power  of  the
                        then-outstanding  voting securities of such corporation,
                        except to the extent that such  ownership  existed prior
                        to the Business Combination, and (C) at least a majority
                        of  the  members  of  the  board  of  directors  of  the
                        corporation  resulting  from such  Business  Combination
                        were members of the  Incumbent  Board at the time of the
                        execution  of the initial  agreement or of the action of
                        the  Board of  Directors  providing  for  such  Business
                        Combination; or

                        4.    Approval by the  stockholders  of the Company of a
                        complete liquidation or dissolution of the Company.

                  (b) Termination for Good Reason.  For purposes of this Exhibit
            A, a  "Termination  for  Good  Reason"  means a  termination  of the
            Executive's  employment  by the  Executive  by  written  Termination
            Notice given to the Company  within 90 days after the  occurrence of
            the Good Reason event.  A Termination  Notice for a Termination  for
            Good Reason shall  indicate the specific  provision in Section II(c)
            relied  upon,  shall set forth in  reasonable  detail  the facts and
            circumstances  claimed to provide a basis for  Termination  for Good
            Reason,  and shall provide the Company a minimum of 30 days in which
            to

                                      A-2

<PAGE>

            remedy such facts or circumstances.  The failure by the Executive to
            set forth in such  Termination  Notice  any  facts or  circumstances
            which  contribute  to the showing of Good Reason shall not waive any
            right  of  Executive   hereunder  or  preclude  the  Executive  from
            asserting  such  fact  or   circumstance  in  enforcing  his  rights
            hereunder.  The Termination Notice for a Termination for Good Reason
            shall  provide for a date of  termination  not less than 30 nor more
            than 60 days after the date such Termination Notice is given.

                  (c) Good Reason. For purposes of this Exhibit A, "Good Reason"
            shall mean the occurrence,  without the Executive's  express written
            consent,  of  any  of  the  following  circumstances,   unless  such
            circumstances  are fully  corrected prior to the date of termination
            specified  in the  Termination  Notice  for a  Termination  for Good
            Reason as  contemplated  in  Section  II(b)  above:  (i) a  material
            diminution    in   the    Executive's    authority,    duties,    or
            responsibilities;  (ii) a  material  diminution  in  the  authority,
            duties, or  responsibilities of the supervisor to whom the Executive
            is required to report,  including, if applicable. a requirement that
            the Executive  report to a corporate  officer or employee instead of
            reporting  directly  to the  board of  directors;  (iii) a  material
            diminution in the budget over which the Executive retains authority;
            (iv) a material  relocation  of the  Company's  principal  executive
            offices (or such other office to which the  Executive is required to
            report); (v) a material diminution in the Executive's Base Salary or
            (vi) any other action or inaction that constitutes a material breach
            by the Company of the Agreement.

III.  Payments and Benefits.

      Separation  pay  upon a Change  in  Control  Termination  shall be paid in
      accordance   with  this  Section  III  provided   that  such   termination
      constitutes  a  "separation  from  service" as defined  under Section 409A
      ("Separation from Service").  If a Change of Control  Termination does not
      constitute a Separation from Service, separation pay shall be paid at such
      later time that a Separation from Service occurs.

      Upon a Separation from Service occurring upon or after a Change of Control
      Termination,  the Executive  shall be entitled to receive,  subject to the
      execution  of the  Release,  the  payments and benefits set forth below in
      this Section III in consideration of the Executive's  agreements under the
      Agreement,  including but not limited to the Executive's  agreement not to
      compete  with the  Company  for a period  of one  year  after a Change  of
      Control Termination  pursuant to Section 5(a) of the Agreement;  provided,
      however,  that any payment made or benefit provided under this Section III
      shall be reduced by any amount paid or payable to the Executive and/or the
      Executive's  family  with  respect  to the same type of payment or benefit
      under any other plan  maintained  by the Company to avoid  duplication  of
      payments or benefits,  including without limitation, any amounts that were
      paid upon termination of employment prior to the Change of Control:

            (a) The  Company  shall pay to the  Executive  within  fifteen  days
      following  the Change of Control  Termination,  a lump sum amount equal to
      (i) two  times the sum of (x) the Base  Salary  as in  effect  immediately
      before the date of  termination  (disregarding  any  reduction  thereof in
      violation  of Section  2(a) of the  Agreement)  and (y) the  Annual

                                      A-3

<PAGE>

      Bonus Amount, plus (ii) $10,000.  The "Annual Bonus Amount" shall mean the
      greater of (i) the  average of the Annual  Bonuses  paid to the  Executive
      with respect to each of the three most recently  completed fiscal years of
      the Company before the date of termination for which a bonus has been paid
      or (ii) the Executive's  Targeted Bonus Amount. The Executive's  "Targeted
      Bonus Amount"  shall mean (x) the higher of 35% and the  percentage of the
      Executive's  targeted bonus in effect before the date of  termination  for
      purposes of determining the Executive's Annual Bonus for the year in which
      the  termination  occurs,  times (y) the  amount of the  Executive's  Base
      Salary as in  effect  for the year in which  the  Executive's  termination
      occurs (disregarding any reduction thereof in violation of Section 2(a) of
      the Agreement).

            (b) The Company shall, until the earlier of 18 months after the date
      of the  Change of  Control  Termination  and such time that the  Executive
      obtains  alternative  coverage,  pay or reimburse  the  Executive  for the
      Company's and the Executive's portion of the cost to provide the Executive
      and the Executive's  eligible  beneficiaries  (if  applicable)  health and
      medical  coverage  under the Company's  health and medical plans  provided
      that the  Executive  timely  elects COBRA  coverage  upon  termination  of
      employment.  In  addition,  for two years  after the date of the Change of
      Control,  the Company  shall  provide the  Executive  with life  insurance
      coverage under the Company's life insurance  policy.  Notwithstanding  the
      foregoing,  to the extent the Company's  plans do not permit the continued
      participation   by  the   Executive   and/or  the   Executive's   eligible
      beneficiaries  or such  participation  would have an adverse tax impact on
      such plans or on the other  participants  in such  plans or the  continued
      participation  is  otherwise  prohibited  by  applicable  law,  or if such
      continuance would constitute  nonqualified deferred compensation that does
      not comply with Section 409A, the Company may instead  provide  materially
      equivalent  benefits  to the  Executive  and/or the  Executive's  eligible
      beneficiaries   outside  such  plans.  For  purposes  of  this  Agreement,
      "materially  equivalent  benefits"  means the aggregate  premiums that the
      Company  would have paid to maintain the  Executive's  coverage  under the
      health, medical and life insurance plans. The Executive agrees to complete
      such  forms  and take  such  physical  examinations  as may be  reasonably
      requested by the Company in connection with life insurance coverage.

            (c) All  outstanding  Options and restricted  stock awards that have
      been granted to the  Executive by the Company at any time but have not yet
      expired  or  vested  and  upon  which  vesting  depends  solely  upon  the
      Executive's  remaining  employed by the Company for a specified  period of
      time, shall immediately vest or become nonforfeitable, as the case may be,
      and the Company  shall,  in the case of Options that are not  exercised or
      cashed out,  extend the period  during which such Options may be exercised
      to the greatest extent permitted by the applicable  plan,  Section 409A or
      other  applicable  law. The Company agrees to take all steps  necessary to
      implement the foregoing sentence.

            (d) The Company,  at its expense,  shall provide the Executive  with
      outplacement  services at a level appropriate for the most senior level of
      executive employees through an outplacement firm of the Executive's choice
      for a period  of up to one year  after the date of the  Change of  Control
      Termination.

                                      A-4

<PAGE>

IV.   Certain Additional Payments.

            (a)  Anything in the  Agreement  and this  Exhibit A to the contrary
      notwithstanding,  in the event it shall be determined  that any Payment or
      any  other  amounts  or  benefits  delivered  to the  Executive  under the
      Agreement  or any other  agreement,  plan,  policy or program,  including,
      without  limitation,  equity  awards,  would be subject to the Excise Tax,
      then the Executive shall be entitled to receive an additional payment (the
      "Gross-Up Payment") in an amount such that, after payment by the Executive
      of all taxes (and any interest or  penalties  imposed with respect to such
      taxes), including,  without limitation, any income taxes (and any interest
      and  penalties  imposed with respect  thereto) and Excise Tax imposed upon
      the  Gross-Up  Payment and after the payment of all  additional  taxes and
      interest imposed under Code Section  409A(a)(1)(B) on the Gross-Up Payment
      and any separation payment made to the Executive hereunder,  the Executive
      retains an amount of the Gross-Up  Payment equal to the Excise Tax imposed
      upon  the  Payments.  Notwithstanding  the  foregoing  provisions  of this
      Section IV(a), if it shall be determined that the Executive is entitled to
      the Gross-Up  Payment,  but that the Parachute  Value of all Payments does
      not exceed 110% of the Safe Harbor Amount,  then no Gross-Up Payment shall
      be made to the  Executive  and the amounts  payable  under this  Agreement
      shall be  reduced  so that the  Parachute  Value of all  Payments,  in the
      aggregate,  equals the Safe Harbor  Amount.  The  reduction of the amounts
      payable  hereunder,  if  applicable,  shall be made by first  reducing the
      payments  under Section III(a) of this Exhibit A and shall be made in such
      a manner as to maximize  the Value of all  Payments  actually  made to the
      Executive.  For  purposes  of  reducing  the  Payments  to the Safe Harbor
      Amount,  only amounts payable under this Agreement (and no other Payments)
      shall be  reduced.  If the  reduction  of the amounts  payable  under this
      Agreement  would not result in a reduction of the  Parachute  Value of all
      Payments to the Safe Harbor Amount,  no amount payable under the Agreement
      shall be reduced pursuant to this Section IV(a). The company's obligations
      under  this  Section  IV shall  not be  conditioned  upon the  Executive's
      termination  of employment  and they shall survive the  termination of the
      Executive's employment. In furtherance of the foregoing, the provisions of
      this IV(a) shall  supersede any provision of any equity award or agreement
      that limits payment of such award or agreement due to Section 280G or 4999
      of the Code, and the Company shall take any necessary action to amend such
      every such award or agreement to comply with this provision.

            (b)  Anything in the  Agreement  and this  Exhibit A to the contrary
      notwithstanding,  in the event it shall be determined  that any amounts or
      benefits  delivered  to the  Executive  under the  Agreement  or any other
      agreement,  plan,  policy or  program  shall be deemed to be  nonqualified
      deferred   compensation   that  does  not   comply   with   Section   409A
      ("Noncompliant 409A Payment"),  and that is therefore subject to the taxes
      and penalties  under Section 409A (the "409A  Taxes"),  then the Executive
      shall be entitled to receive an  additional  payment  (the "409A  Gross-Up
      Payment") in an amount such that,  after  payment by the  Executive of all
      taxes (and any interest or penalties  imposed with respect to such taxes),
      including,  without  limitation,  any income  taxes (and any  interest and
      penalties  imposed with respect  thereto) and taxes  imposed upon the 409A
      Gross-Up  Payment,  the  Executive  shall  retain  an  amount  of the 409A
      Gross-Up Payment equal to the 409A Taxes imposed upon the Payments.

                                      A-5

<PAGE>

            (c) Subject to the provisions of Section IV(d), all determinations
      required to be made under this Section IV, including whether and when a
      Gross-Up Payment or 409A Gross-Up Payment is required, the amount of such
      Gross-Up Payment or 409A Gross-Up Payment, and the assumptions to be
      utilized in arriving at such determination, shall be made by any
      nationally recognized certified public accounting firm as may be
      designated by the Executive (the "Accounting Firm"). The Accounting Firm
      shall provide detailed supporting calculations both to the Company and the
      Executive within 15 business days of the receipt of notice from the
      Executive that there has been a Payment or a payment that the Executive
      reasonably believes to be a Noncompliant 409A Payment, or such earlier
      time as is requested by the Company. In the event that the Accounting Firm
      is serving as accountant or auditor for the individual, entity or group
      effecting the Change of Control, the Executive may appoint another
      nationally recognized accounting firm to make the determinations required
      hereunder (which accounting firm shall then be referred to as the
      Accounting Firm hereunder). All fees and expenses of the Accounting Firm
      shall be borne solely by the Company. Any Gross-Up Payment, or 409A
      Gross-Up Payment, as determined pursuant to this Section IV, shall be paid
      by the Company to the Executive within five business days of the receipt
      of the Accounting Firm's determination, which determination shall be made
      no later than the end of the second month following the later of (1) the
      calendar year in which the Executive's employment with the Company
      terminates and (2) the taxable year of the Company in which the
      Executive's employment with the Company terminates. Payment of the
      Gross-Up Payment or the 409A Gross-Up Payment shall be made as soon as
      practicable after such determination has been made, but in no event shall
      payment be made later than the end of the Executive's taxable year next
      following the Executive's taxable year in which the Executive shall have
      remitted the related taxes.

            Any  determination  by the Accounting Firm shall be binding upon the
      Company  and  the  Executive.  As a  result  of  the  uncertainty  in  the
      application  of  Sections  4999  and  409A of the  Code at the time of the
      initial  determination  by the Accounting Firm  hereunder,  it is possible
      that Gross-Up  Payments and 409A Gross-Up Payments that will not have been
      made by the Company should have been made (the "Underpayment"), consistent
      with the  calculations  required  to be made  hereunder.  In the event the
      Company exhausts its remedies  pursuant to Section IV(c) and the Executive
      thereafter  is required to make a payment of any Excise Tax or 409A Taxes,
      the Accounting  Firm shall determine the amount of the  Underpayment  that
      has  occurred  and any such  Underpayment  shall be  promptly  paid by the
      Company to or for the benefit of the Executive.

            (d) The  Executive  shall notify the Company in writing of any claim
      by the Internal  Revenue  Service that, if  successful,  would require the
      payment  by the  Company  of the  Gross-Up  Payment  or the 409A  Gross-Up
      Payment.  Such notification shall be given as soon as practicable,  but no
      later than ten business days after the Executive is informed in writing of
      such claim.  The Executive shall apprise the Company of the nature of such
      claim  and the  date on which  such  claim is  requested  to be paid.  The
      Executive  shall not pay such claim prior to the  expiration of the 30-day
      period  following the date on which the Executive gives such notice to the
      Company  (or such  shorter  period  ending on the date that any payment of
      taxes with  respect to such claim is due).  If the  Company

                                      A-6

<PAGE>

      notifies the Executive in writing  prior to the  expiration of such period
      that the Company desires to contest such claim, the Executive shall:

            (1)   give the Company any information  reasonably  requested by the
            Company relating to such claim,

            (2)   take such action in connection  with  contesting such claim as
            the Company shall  reasonably  request in writing from time to time,
            including,  without limitation,  accepting legal representation with
            respect  to such claim by an  attorney  reasonably  selected  by the
            Company,

            (3)   cooperate   with  the  Company  in  good  faith  in  order  to
            effectively contest such claim, and

            (4)   permit the Company to participate in any proceedings  relating
            to such claim;

            provided,  however, that the Company shall bear and pay directly all
      costs and expenses (including  additional interest and penalties) incurred
      in  connection  with  such  contest,  and  shall  indemnify  and  hold the
      Executive  harmless,  on an after-tax  basis, for any Excise Tax or income
      tax  (including  interest  and  penalties)  imposed  as a  result  of such
      representation  and payment of costs and expenses.  Without  limitation on
      the foregoing  provisions of this Section IV(c), the Company shall control
      all proceedings  taken in connection  with such contest,  and, at its sole
      discretion,  may  pursue  or  forgo  any and all  administrative  appeals,
      proceedings, hearings and conferences with the applicable taxing authority
      in respect of such claim and may, at its sole  discretion,  either  direct
      the  Executive  to pay the tax claimed and sue for a refund or contest the
      claim in any  permissible  manner,  and the Executive  agrees to prosecute
      such contest to a determination before any administrative  tribunal,  in a
      court of initial  jurisdiction and in one or more appellate courts, as the
      Company shall determine;  provided,  however,  that if the Company directs
      the  Executive to pay such claim and sue for a refund,  the Company  shall
      advance the amount of such payment to the Executive,  on an  interest-free
      basis,  and  shall  indemnify  and  hold  the  Executive  harmless,  on an
      after-tax basis, from any Excise Tax or income tax (including  interest or
      penalties)  or 409A Taxes  imposed  with  respect to such  advance or with
      respect  to any  imputed  income  in  connection  with such  advance;  and
      provided,  further,  that any  extension  of the  statute  of  limitations
      relating to payment of taxes for the taxable  year of the  Executive  with
      respect  to which  such  contested  amount is claimed to be due is limited
      solely to such contested amount. Furthermore, the Company's control of the
      contest  shall be limited  to issues  with  respect to which the  Gross-Up
      Payment  or 409A  Gross-Up  Payment  would be payable  hereunder,  and the
      Executive shall be entitled to settle or contest,  as the case may be, any
      other issue  raised by the  Internal  Revenue  Service or any other taxing
      authority.

            (e) If, after the receipt by the Executive of a Gross-Up  Payment or
      409A  Gross-Up  Payment or an amount  advanced by the Company  pursuant to
      Section IV(d),  the Executive  becomes entitled to receive any refund with
      respect to the Excise Tax to which such Gross-Up  Payment  relates or with
      respect to such claim,  the  Executive  shall

                                      A-7

<PAGE>

      (subject  to the  Company's  complying  with the  requirements  of Section
      IV(c),  if  applicable)  promptly  pay to the  Company  the amount of such
      refund  (together  with any interest paid or credited  thereon after taxes
      applicable  thereto).  If, after the receipt by the Executive of an amount
      advanced by the Company pursuant to Section IV(c), a determination is made
      that the  Executive  shall not be entitled  to any refund with  respect to
      such claim and the Company does not notify the Executive in writing of its
      intent to contest such denial of refund prior to the expiration of 30 days
      after such  determination,  then such advance  shall be forgiven and shall
      not be required to be repaid and the amount of such advance  shall offset,
      to the extent thereof, the amount of Gross-Up Payment required to be paid.

            (f)  Notwithstanding  any other  provision  of this  Section IV, the
      Company may, in its sole discretion, withhold and pay over to the Internal
      Revenue Service or any other applicable taxing authority,  for the benefit
      of the  Executive,  all or any  portion  of any  Gross-Up  Payment or 409A
      Gross-Up Payment, and the Executive hereby consents to such withholding.

            (g)  Definitions.  The  following  terms  shall  have the  following
      meanings for purposes of this Section IV.

                 (i) "Code"  shall mean the Internal  Revenue  Code of 1986,  as
      amended, or any successor thereto.

                 (ii)  "Excise Tax" shall mean the excise tax imposed by Section
      4999 of the Code,  together  with any interest or  penalties  imposed with
      respect to such excise tax.

                 (iii)  "Parachute  Value" of a Payment  shall mean the  present
      value as of the date of the change of control for purposes of Section 280G
      of the Code of the portion of such Payment that  constitutes  a "parachute
      payment" under Section  280G(b)(2),  as determined by the Accounting  Firm
      for purposes of determining whether and to what extent the Excise Tax will
      apply to such Payment.

                 (iv) "Payment"  shall mean any payment or  distribution  in the
      nature of  compensation  (within the meaning of Section  280G(b)(2) of the
      Code) to or for the  benefit  of the  Executive,  whether  paid or payable
      pursuant to this Agreement or otherwise.

                 (v) "Safe Harbor Amount" means 2.99 times the Executive's "base
      amount," within the meaning of Section 280G(b)(3) of the Code.

                 (vi) "Value" of a Payment shall mean the economic present value
      of a Payment  as of the date of the  change of  control  for  purposes  of
      Section 280G of the Code, as determined by the  Accounting  Firm using the
      discount rate required by Section 280G(d)(4) of the Code.

            (h) The  Company's  obligations  under this  Section IV shall not be
      conditioned upon the Executive's termination of employment, and they shall
      survive the  termination of the  Executive's  employment and the Term with
      respect to any Payments or other payments

                                      A-8

<PAGE>

      that are determined by the Accounting  Firm to be either (i) contingent on
      a "change of  control"  (as  defined  in Section  280G of the Code) of the
      Company  that  occurs  during  the  Term,  or (ii)  nonqualified  deferred
      compensation that does not comply with Section 409A.

            (i) Any Gross-Up  Payment or 409A Gross-Up  Payment shall be made no
      later than the end of the  Executive's  taxable year following the taxable
      year in which the Executive remits the related taxes.

V.    Legal  Fees.  If,  following a Change of  Control,  the  Company  fails to
      perform any of its obligations  under this Agreement or the Company or any
      other person asserts the invalidity of any provision of this Agreement and
      the Executive incurs any costs in successfully  enforcing or defending any
      of the provisions of this Agreement, including legal fees and expenses and
      court costs,  the Company shall reimburse the Executive for all such costs
      incurred by him, unless the trier of fact in such dispute  determines that
      the  Executive  has  not  been  at  least  partially  successful  in  such
      enforcement or defense.  Any  reimbursement  under this Section V shall be
      made no later than the end of calendar year following the calendar year in
      which such costs are incurred by the Executive.

                                      A-9

<PAGE>

                                    EXHIBIT B

                                     RELEASE

            This Release is made this _____ day of _______________,  ____ by and
between C&D Technologies, Inc. ("Employer") and Leonard P. Kiely ("Employee").

                                    Recitals:

            WHEREAS,  the parties are parties to an  Employment  Agreement  (the
"Employment  Agreement") dated December 20, 2007, pursuant to which Employee was
employed by Employer; and

            WHEREAS,  Employee's  employment  and the Term,  as  defined  in the
Employment Agreement, have terminated; and

            WHEREAS, the execution and delivery of this Release by Employee is a
condition to the Employer's  obligations to pay certain compensation and provide
certain benefits to Employee under the Employment Agreement;

            NOW THEREFORE, the parties hereto, intending to be legally bound, in
consideration  of the mutual  promises and  undertakings  set forth  herein,  do
hereby agree as follows:

            1.    As of _____________________,  ____, Employee's employment with
Employer   shall   terminate,   and   Employee   shall  have  no   further   job
responsibilities to perform for Employer; provided, however, that Employee shall
cooperate  with Employer in  transitioning  Employee's job  responsibilities  as
Employer shall reasonably  request,  provided that Employee shall be entitled to
receive reasonable compensation for any services rendered prior to such date and
shall  not be  obligated  to take  any  action  that  would  interfere  with any
subsequent  employment of Employee or otherwise  result in economic  hardship to
Employee.

            2.    Employer  shall pay and  provide to  Employee  the amounts and
benefits  contemplated  pursuant to Section 9 [and Exhibit A] of the  Employment
Agreement, less applicable deductions; provided however, the first payment shall
not be due and  payable  until ten days  after the  execution  by  Employee  and
delivery to Employer of this Release..

            3.    For and in  consideration  of the monies and benefits  paid to
Employee by Employer,  as more fully described in Section 2 above, and for other
good and valuable  consideration,  Employee hereby waives,  releases and forever
discharges  Employer,  its assigns,  predecessors,  successors,  and  affiliated
entities,  and  its  current  or  former  stockholders,   officers,   directors,
administrators,   agents,   servants   and   employees,   individually   and  as
representatives of the corporate entity (hereinafter collectively referred to as
"Releasees"), from any and all claims, suits, debts, dues, accounts, reckonings,
bonds,  bills,  specialties,   covenants,   contracts,  bonuses,  controversies,
agreements,  promises,  charges,  complaints,  damages, sums of money, interest,
attorney's fees and costs, or causes of action of any kind or nature  whatsoever
whether in law or equity,  including, but not limited to, all claims arising out
of his employment or termination of employment with Employer, such as all claims
for  wrongful  discharge,   breach  of  contract,  either

                                      B-1

<PAGE>

express or implied,  interference  with  contract,  emotional  distress,  fraud,
misrepresentation,  defamation,  claims  arising  under the Civil Rights Acts of
1964 and  1991,  as  amended,  the  Americans  With  Disabilities  Act,  the Age
Discrimination  in Employment Act (ADEA),  the National Labor Relations Act, the
Fair Labor  Standards Act, the Employee  Retirement  Income Security Act of 1974
(ERISA),  as amended,  the Family and Medical Leave Act, the Pennsylvania  Human
Relations Act, the Pennsylvania  Wage Payment & Collection Law, the Pennsylvania
Minimum Wage Act of 1968, the Pennsylvania  Equal Pay Law, and any and all other
claims   arising  under  federal,   state  or  local  law,   rule,   regulation,
constitution, ordinance or public policy whether known or unknown, arising up to
and including the date of execution of this Release; provided, however, that the
parties do not release  each other from any claim of breach of the terms of this
Release.  This  release of rights does not extend to claims that may arise after
the date of this Release, including without limitation, for payments or benefits
described in Section 2 of this  Release,  nor to claims under  employee  benefit
plans that are qualified under Section 401(a) of the Internal  Revenue Code, nor
to any rights of  indemnification  by the Company or  advancement of expenses to
which the  Employee is  otherwise  entitled,  nor to any equity  awards that are
outstanding on the date of  termination.  Employee agrees that Employee will not
initiate  any charge or  complaint  or  institute  any claim or lawsuit  against
Releasees or any of them based on any fact or  circumstance  occurring up to and
including  the date of the  execution by Employee of this  Release  based upon a
claim that is released hereunder.

            4.    Employee agrees that the payments made and other consideration
received  pursuant to this  Release are not to be  construed  as an admission of
legal  liability  by Releasees or any of them and that no person or entity shall
utilize this Release or the  consideration  received pursuant to this Release as
evidence of any admission of liability since Releasees expressly deny liability.

            5.    Employee affirms that the only  consideration  for the signing
of this Release are the terms stated herein and in the Employment  Agreement and
that no other  promise or agreement of any kind has been made to Employee by any
person or entity whatsoever to cause Employee to sign this Release.

            6.    Employee and Employer affirm that the Employment Agreement and
this Release set forth the entire agreement  between the parties with respect to
the subject matter contained  herein and supersede all prior or  contemporaneous
agreements  or  understandings  between the parties  with respect to the subject
matter contained herein. Further, there are no representations,  arrangements or
understandings, either oral or written, between the parties, which are not fully
expressed herein.  Finally,  no alteration or other modification of this Release
shall be effective unless made in writing and signed by both parties.

            7.    Employee acknowledges that Employee has been given a period of
at least 21 days within which to consider this Release.

            8.    Following the execution of this Release, Employee has a period
of seven  days from the date of  execution  to  revoke  this  Release,  and this
Release shall not become  effective or enforceable  until the revocation  period
has expired.

                                      B-2

<PAGE>

            9.    Employee  certifies that Employee has returned to Employer all
keys,  identification  cards, credit cards, computer and telephone equipment and
other property or information of Employer in Employee's possession,  custody, or
control including, but not limited to, any information contained in any computer
files  maintained  by  Employee  during  Employee's  employment  with  Employer.
Employee  certifies  that  Employee has not kept the  originals or copies of any
documents,  files,  or other  property of Employer  which  Employee  obtained or
received during Employee's employment with Employer.

            10.   Employee  acknowledges  and agrees that the  execution of this
Release does not supercede any of the  provisions  of the  Employment  Agreement
which  otherwise  survive the  termination  of  Employee's  employment  with the
Employer, including without limitation, Section 5, 6, 7 and 19 thereof.

            11.   Employee   acknowledges  that  Employer  advised  Employee  to
consult with an attorney prior to executing this Release.

            12.   Employee   affirms  that  Employee  has  carefully  read  this
Release,  that  Employee  fully  understands  the  meaning  and  intent  of this
document,  that Employee has signed this Release voluntarily and knowingly,  and
that Employee intends to be bound by the promises  contained in this Release for
the aforesaid consideration.

            IN WITNESS WHEREOF,  Employee and the authorized  representative  of
Employer have executed this Release on the dates indicated below:

                                               C&D TECHNOLOGIES, INC.

Dated:                                         By
       _____________________________________       _____________________________

                                               Title:
                                                      __________________________

Dated:
      _____________________________________    _________________________________
                                               Leonard P. Kiely

                                      B-3

<PAGE>

                                  ENDORSEMENT

            I, Leonard P. Kiely,  hereby acknowledge that I was given 21 days to
consider the foregoing  Release and voluntarily  chose to sign the Release prior
to the expiration of the 21-day period.

            I  declare   under   penalty  of  perjury  under  the  laws  of  the
Commonwealth of Pennsylvania that the foregoing is true and correct.

            EXECUTED   this  ________  day  of   __________________,   ____,  at
____________________________, Pennsylvania.

                                               _______________________
                                               Leonard P. Kiely

                                      B-4