UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE l3D
Under the Securities Exchange Act of 1934
Artesyn Technologies, Inc.
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(Name of Issuer)
Common Stock, $0.01 par value
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(Title of Class of Securities)
043127109
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(CUSIP Number)
Colin W. Dunn, Vice President
Bel Fuse Inc.
206 Van Vorst Street
Jersey City, New Jersey 07302
(201) 432-0463
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(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
September 1, 2004
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(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule l3G to report
the acquisition that is the subject of this Schedule 13D, and is filing this
schedule because of Sections 240.13d-1(e), 240.13d-1(f) or 240.13d-1(g), check
the following box. [ ]
Note: Schedules filed in paper format shall include a signed original and five
copies of the schedule, including all exhibits. See Section 240.13d-7 for other
parties to whom copies are to be sent.
*The remainder of this cover page shall be filled out for a reporting person's
initial filing on this form with respect to the subject class of securities, and
for any subsequent amendment containing information which would alter
disclosures provided in a prior cover page.
The information required on the remainder of this cover page shall not be deemed
to be "filed" for the purpose of Section 18 of the Securities Exchange Act of
1934 ("Act") or otherwise subject to the liabilities of that section of the Act
but shall be subject to all other provisions of the Act (however, see the
Notes).
Cusip No. 043127109
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1) Names of Reporting Persons. I.R.S. Identification Nos. of above persons
(entities only):
Bel Fuse Inc., IRS Identification No. 22-1463699
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2) Check the Appropriate Box if a Member of a Group (See Instructions):
(a) [ ]
(b) [ ]
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3) SEC Use Only
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4) Source of Funds (See Instructions): WC
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5) Check if Disclosure of Legal Proceedings is Required Pursuant to Items
2(d) or 2(e):
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6) Citizenship or Place of Organization: New Jersey
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Number of 7) Sole Voting Power: 2,037,500
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Shares Beneficially 8) Shared Voting Power:
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Owned by
Each Reporting 9) Sole Dispositive Power: 2,037,500
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Person With 10) Shared Dispositive Power:
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11) Aggregate Amount Beneficially Owned by Each Reporting Person:
2,037,500
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12) Check if the Aggregate Amount in Row (11) Excludes Certain Shares (See
Instructions):
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13) Percent of Class Represented by Amount in Row (11): 5.2%
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14) Type of Reporting Person (See Instructions): CO
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Item 1. Security and Issuer
-------------------
This statement on Schedule 13D (the "Schedule 13D") relates to the
shares of common stock, $0.01 par value (the "Common Stock"), of Artesyn
Technologies, Inc. (the "Company"), whose principal executive offices are
located at 7900 Glades Road, Suite 500, Boca Raton, Florida 33434-4105.
Item 2. Identity and Background
-----------------------
Bel Fuse Inc. ("Bel") is a corporation organized under the laws of
the State of New Jersey. Bel is engaged in the design, manufacture and sale of
products used in networking, telecommunication, automotive and consumer
electronic applications. Bel maintains its principal executive offices at 206
Van Vorst Street, Jersey City, New Jersey 07302. Attached hereto is an Appendix
to Item 2 setting forth the name, present principal occupation or employment,
the current business address and citizenship of each director and executive
officer of Bel.
Neither Bel nor, to the best of its knowledge, any of its directors or
executive officers has, during the last five years, (a) been convicted in a
criminal proceeding (excluding traffic violations or similar misdemeanors) or
(b) been a party to a civil proceeding of a judicial or administrative body of
competent jurisdiction as a result of which such entity or person was or is now
subject to a judgment, decree or final order enjoining future violations of, or
prohibiting or mandating activities subject to, federal or state securities laws
or finding any violation with respect to such laws.
Item 3. Source and Amount of Funds or Other Consideration
-------------------------------------------------
In a series of transactions from July 29, 2004 through September 1,
2004, Bel, through its wholly-owned subsidiary, Bel Ventures Inc., acquired an
aggregate of 2,037,500 shares of Common Stock of the Company through open-market
purchases. Bel paid an aggregate of $16,339,780.91 (which amount includes the
cost of commissions) for these shares of Common Stock of the Company out of
working capital. The respective dates of acquisition of the shares of Common
Stock, the amount of shares of Common Stock purchased in each such acquisition,
and the purchase price per share with respect to each such acquisition are set
forth below:
Date of Acquisition Number of Shares Purchased Price Per Share
------------------- -------------------------- ---------------
07/29/04 30,000 $7.5000
07/29/04 266,700 7.5435
07/30/04 15,000 7.4250
08/02/04 5,000 7.4950
08/03/04 95,000 7.3748
08/04/04 19,000 7.2600
08/05/04 50,500 7.4401
08/06/04 103,500 7.2190
08/09/04 80,000 7.3122
08/10/04 40,000 7.4660
08/11/04 85,000 7.4453
08/12/04 100,000 7.4985
08/13/04 85,000 7.4959
08/19/04 152,500 8.3385
08/23/04 200,000 8.4500
08/24/04 160,000 8.4338
08/25/04 150,000 8.4667
08/26/04 10,000 8.4500
08/27/04 15,000 8.4600
08/30/04 207,800 8.5947
08/31/04 40,000 8.4900
09/01/04 95,000 8.5350
09/01/04 32,500 8.2992
Item 4. Purpose of Transaction
----------------------
By letter dated August 31, 2004, set forth as Exhibit 1 (the "August
Letter"), Bel informally approached the Company to discuss the possibility of a
merger involving Bel and the Company. The proposal in the August Letter is not
intended to be a formal exchange offer for Company shares, nor does it reflect
any intention by Bel to commence such an offer without first receiving the
consent of the Company's Board of Directors. As of the date of this filing, the
Company has not responded to the August Letter. Bel has attempted to contact the
Company for a response. Given the difficult conditions confronting the State of
Florida in the wake of Hurricane Frances, however, Bel has been unable to
contact the Chairman/Chief Executive Officer.
Bel intends to closely evaluate the performance of the Common Stock,
including, but not limited to, analyzing and evaluating the Company's business,
assets, operations, financial condition, capital structure, management and
prospects. Depending upon the Company's financial condition, results of
operations and future prospects, the Company's response to the August Letter and
other factors which Bel deems relevant, Bel may, and hereby reserves the right
to, (i) acquire additional shares of Common Stock of the Company or sell the
shares Bel owns, (ii) communicate with other shareholders of the Company or
persons who may desire to become shareholders of the Company regarding the
pursuit of a possible change of control transaction and/or change in the
composition of the Board of Directors, (iii) seek to amend the Articles of
Incorporation or By-laws of the Company to alter the size of the Board of
Directors and/or for any other purpose, (iv) solicit proxies, to be used at
either the Company's regular annual meeting or at a special meeting, or consents
in lieu of any such meeting, for the purposes described in (iii) above or for
the election of one or more nominees of Bel and/or other shareholders to the
Board of Directors of the Company, (v) seek to cause the Company to merge with
or into, consolidate with, transfer all or substantially all of its assets to,
or otherwise engage in any business combination with, one or more parties
(whether or not affiliated with or otherwise related to Bel), or (vi) take such
other action as Bel may determine.
Item 5. Interest in Securities of the Issuer
------------------------------------
Based upon information set forth in the Company's Quarterly Report on
Form 10-Q for the fiscal quarter ended June 25, 2004, there were 39,199,251
shares of Common Stock outstanding as of July 23, 2004. As of September 1, 2004,
Bel beneficially owned an aggregate of 2,037,500 shares of Common Stock, or 5.2%
of the outstanding shares of Common Stock.
Bel has the sole power to vote or to direct the vote and the sole
power to dispose or to direct the disposition of all 2,037,500 shares of Common
Stock beneficially owned by it.
Except as described in Item 3 of this Schedule 13D, during the past
sixty days, there were no purchases of the shares of Common Stock, or securities
convertible into or exchangeable for shares of Common Stock, by Bel or any
person or entity controlled by Bel or any person or entity for which Bel
possesses voting control over the securities thereof. During such sixty day
period, there were no sales of the shares of Common Stock, or securities
convertible into or exchangeable for shares of Common Stock, by Bel or any
person or entity controlled by Bel or any person or entity for which Bel
possesses voting control over the securities thereof.
No other person is known by Bel to have the right to receive or the
power to direct the receipt of dividends from, or the proceeds from the sale of,
the Common Stock beneficially owned by Bel.
Item 6. Contracts, Arrangements, Understandings or Relationships with Respect
to Securities of the Issuer
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No contracts, arrangements, understandings or similar relationships
exist with respect to the securities of the Company between Bel and any person
or entity, other than an engagement letter agreement (the "Engagement Letter")
between Bel and Stephens Inc. (the "Advisor"), dated September 1, 2004. Pursuant
to the Engagement Letter, Bel has retained the Advisor to assist the Company in
analyzing its investment in Artesyn. The Advisor, if requested, will also assist
the Company in structuring and analyzing the financial implications of a
potential business combination, joint venture or other business transaction with
Artesyn. The Engagement Letter obligates Bel to pay the Advisor fees that would
be customary for such assistance. A copy of the Engagement Letter is set forth
as Exhibit 2 to this filing.
The descriptions of the letters and agreements set forth in this
Schedule 13D are qualified in their entirety by reference to the complete
letters and agreements governing such matters, each of which are incorporated by
reference to this Schedule 13D as exhibits pursuant to Item 7 hereof.
Item 7. Material to Be Filed as Exhibits
--------------------------------
1. Letter, dated August 31, 2004, from Bel Fuse Inc. to the Company.
2. Engagement Letter Agreement, dated September 1, 2004, by and
between the Company and Stephens Inc.
Signature
---------
After reasonable inquiry and to the best of my knowledge and belief,
I certify that the information set forth in this statement is true, complete and
correct.
September 9, 2004
BEL FUSE INC.
By:/s/ Colin W. Dunn
----------------------------------
Name: Colin W. Dunn
Title: Vice President
Attention: Intentional misstatements or omissions of fact constitute
Federal criminal violations (See 18 U.S.C. 1001).
Appendix to Item 2
Name and Address* Position with Principal Employment
Bel Fuse Inc. and Address of Employer
------------------------------- ------------------------- ---------------------------------------
Daniel Bernstein** Executive Officer President and Chief Executive
and Director Officer of Bel Fuse Inc.
------------------------------- ------------------------- ------------------------------------------
Howard Bernstein Director Retired
21 Big Beech Lane
Colts Neck, NJ 07722
------------------------------- ------------------------- ------------------------------------------
Colin Dunn** Executive Officer Vice President Finance, Treasurer
and Secretary of Bel Fuse Inc.
------------------------------- ------------------------- ------------------------------------------
Joseph Meccariello*** Executive Officer Vice President of Manufacturing, Bel
Fuse Inc.
------------------------------- ------------------------- ------------------------------------------
Joseph Tweedy Director Independent consultant
26 Huron Road
Floral Park, NY 11001
------------------------------- ------------------------- ------------------------------------------
Robert H. Simandl Director Attorney
(see employer address)
24 North 3rd Avenue, Highland Park,
NJ 08904
------------------------------- ------------------------- ------------------------------------------
Peter Gilbert Director Director of PCA Aerospace, Inc.
(see employer address) Executive VP of PCA Industries, LLC
1818 East Rosslynn Avenue
Fullerton, CA 92831
------------------------------- ------------------------ ------------------------------------------
John S. Johnson Director Independent consultant for various
P.O. Box 1164 companies, including Bel Fuse Inc.
Queeche, VT 05059
------------------------------- ------------------------ ------------------------------------------
Avi Eden Director Independent consultant
335 South 16th Street
Philadelphia, PA 19102
------------------------------- ------------------------ ------------------------------------------
Dwayne Vasquez** Executive Officer Vice President of Sales
of Bel Fuse Inc.
------------------------------- ------------------------ ------------------------------------------
Dennis Ackerman** Executive Officer Vice President of Operation of
Bel Fuse Inc.
------------------------------- ------------------------ ------------------------------------------
* All of the Directors and Executive Officers of Bel Fuse Inc. are citizens of
the United States. Colin Dunn has dual citizenship and is also an Australian
citizen.
** Employer address is 206 Van Vorst Street, Jersey City, New Jersey 07302
*** Employer address 8/F, 8 Luk Hop Street, San Po Kong, Kowloon, Hong Kong
Exhibit 1
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Bel
Components for a
Connected Planet
Bel Fuse Inc.
206 Van Vorst Street
Jersey City, NJ 07302 USA
www.belfuse.com
tel 201.432.0463
fax 201.432.9542
August 31, 2004
Mr. Joseph M. O'Donnell
Chairman, Chief Executive Officer and President
Artesyn Technologies Inc
7900 Glades Road, Suite 500
Boca Raton, FL 33434
Dear Mr. O'Donnell:
I am writing following our earlier conversation in which I informed you that Bel
would shortly be filing a 13-D relating to its acquisition of Artesyn stock and
proposed that we enter into discussions to merge Artesyn and Bel in order to
create a premier supplier to the computing and communications industry.
We have a wonderful opportunity to create a company that is far stronger and
more valuable than either Artesyn or Bel can be standing alone. To this end, we
are proposing a stock for stock merger in which Bel would issue 0.265 of a share
of its Class B common stock for each share of Artesyn stock. Based on our
closing price today, the proposed transaction has a total equity value of over
$520 million, assuming approximately 52.0 million Artesyn shares outstanding
after the conversion of the convertible notes and the exercise of in-the-money
options. This offer represents a premium of about 26% over Artesyn's average
closing price for the last thirty trading days. (It should be noted that we have
accounted for approximately 25% of the total volume of Artesyn stock over the
last several weeks. During this time, Artesyn's stock price has risen
approximately 12%. We feel that our purchases have been a significant
contributor to this recent increase in value.)
The combined company would be a leading vendor of a broad array of
electro-mechanical components and subsystems to most of the leading computing,
networking and telecommunications companies in the world. While both companies
have a long history of serving the market leaders in these industries, this
expanded breadth of product offering is increasingly important as many of these
companies are now looking to reduce their vendor base to a smaller number of key
suppliers. This combination of companies would clearly emerge as one of the
world's leading electro-mechanical vendors. Both companies have a strong track
record of technology leadership coupled with cost-effective manufacturing and
focus on serving the market leaders.
Because of our common approach to the market, we see many opportunities for
improvements in operating performance, generating new business and other
combination benefits. We believe that not only will these benefits create
enormous value for the shareholders of both companies, but we are also convinced
that our expanded product offering and improved operating efficiencies will
prove valuable to our collective customers. Together, we will be best positioned
to meet our respective competitive challenges.
Bel has a stable and respected management team with a strong track record of
creating both shareholder and customer value through its recent acquisitions. In
fact, our shares have consistently outperformed many leading stock indices,
including the S&P 500 and the NASDAQ Composite Index, over the last five years.
While these indices have shown negative returns during this time period, Bel
stock has appreciated by about 140%. Given the historical performance of our
Company and the strength of our balance sheet, we strongly believe that a merger
of Artesyn and Bel would, both in the near-term and long-term, provide a far
superior return to Artesyn's stockholders than would otherwise be achieved. In
addition, our Class B common stock currently pays a quarterly dividend of $0.05
per share, and under the terms of our proposal we would plan to maintain this
dividend.
The Bel management team understands and appreciates Artesyn's stature in the
market and the relationship the company has built with strategic customers. We
also know and respect many of the talented managers and executives at Artesyn
whom we envision would also play a key role in managing the combined company. In
addition, we would welcome a number of mutually agreed upon directors from the
Artesyn Board joining the Board of the combined company.
Our proposal at this time is not intended to be a formal exchange offer for
Artesyn shares, nor does it reflect any intention by Bel to commence such an
offer without first receiving the consent of the Artesyn Board of Directors. We
are ready to undertake a mutual due diligence review at your earliest
convenience and to meet with your team to negotiate a transaction. We believe
that it would be in the best interest of our respective shareholders, customers
and employees to complete the merger in a timely fashion and believe that with
your cooperation we could complete the transaction within the current calendar
year. To that point, we are confident that all necessary approvals can be
obtained in a reasonable time period and expect that a combination of our
companies would have no significant contingencies other than customary
conditions that would be included in the definitive merger agreement. In order
to facilitate a possible transaction, we have retained Stephens Inc. to act as
our financial advisor.
We hope that the Artesyn Board will pursue the opportunity that this proposed
combination presents to your shareholders.
Very truly yours,
Daniel Bernstein
President and Chief Executive Officer
Bel Fuse, Inc.
Exhibit 2
---------
Stephens Inc.
September 1, 2004
Mr. Daniel J. Bernstein
President and Chief Executive Officer
Bel Fuse, Inc.
206 Van Vorst Street
Jersey City, NJ 07302
Dear Dan,
This letter summarizes the terms of engagement of Stephens Inc.
("Stephens") to act as exclusive financial advisor to Bel Fuse, Inc. (the
"Company") in connection with its investment in Artesyn Technologies, Inc.
("Artesyn").
In general, we will assist the Company in analyzing and positioning its
investment in Artesyn. We will also assist the Company, if requested, in
structuring and analyzing the financial implications of a potential Business
Combination, Joint Venture or other business transaction with Artesyn. Our
assistance will include preparing and making presentations to the Company's
Board of Directors, formulating negotiation strategies and conducting
negotiations, assisting with the preparation of agreements in principle and
definitive agreements, as appropriate, and in such other matters as may be
agreed upon from time to time by Stephens and the Company. As used in this
letter, the term "Business Combination" means any acquisition, directly or
indirectly, by the Company, or any of its affiliates, of more than 50% of the
capital stock or assets of Artesyn, by way of tender or exchange offer,
negotiated purchase or otherwise. The terms of any Business Combination will be
subject to the Company's approval, and Stephens is not authorized to make any
agreement or commitment on behalf of the Company.
Stephens will, if requested by the Board of Directors, render an opinion as
to the fairness, from a financial point of view, of the consideration payable by
the Company, or the exchange ratio, as the case may be, in connection with any
proposed Business Combination. If requested by the Board of Directors, our
opinion shall be delivered in writing. The nature and scope of the investigation
and analysis which we will conduct in order to be able to render our opinion, as
well as the form and substance of our opinion, will be such as we consider
appropriate. It is understood and agreed that any information or advice rendered
by Stephens or its representatives in connection with its engagement hereunder
is solely for the confidential use of the Board of Directors of the Company in
its evaluation of a Business Combination. The Company may not, and may not
permit any other person or entity to, publish or refer to our opinion (either in
its entirety or through excerpts or summaries) without the prior written
approval of Stephens. Any opinion rendered by Stephens and a summary discussion
of Stephens' underlying analyses and role as financial advisor to the Board may
be included in a proxy statement mailed to the Company's shareholders in
connection with the Business Combination provided that such opinion is
reproduced in its entirety and Stephens approves such disclosure prior to the
filing of such proxy statement with the United States Securities and Exchange
Commission.
Investment Bankers
WWW.STEPHENS.COM
111 Center Street Post Office Box 3507 Little Rock, Arkansas 72203-3507
501-374-4361 Fax 501-377-2674
September 1, 2004
Page 2
Our engagement hereunder may be terminated any time after August 31, 2005,
by either Stephens or the Company upon thirty days' prior written notice thereof
to the other party; provided, however, that the provisions of the
indemnification rider attached as Exhibit A, the confidentiality provisions of
the preceding paragraph, and the compensation and expense reimbursement
provisions of this agreement will survive such termination.
In the event that the Company makes a tender or exchange offer for
securities in connection with the Business Combination, the Company will retain
Stephens as sole dealer-manager for such offer and will enter into a separate
dealer-manager agreement with Stephens containing customary terms and conditions
to be mutually agreed upon, but not providing for the payment of any fees other
than those provided for in this letter.
In consideration of the services to be rendered by Stephens pursuant to
this agreement, the Company agrees to pay Stephens the following fees:
i. A fee for the rendering of any fairness opinion shall be $500,000
payable at the time such opinion is rendered. If the Board of
Directors requests Stephens to render additional opinions with respect
to amended or revised offers, the Company shall pay Stephens an
additional fee of $50,000 for each additional opinion; and
ii. A success fee shall be paid if a Business Combination with Artesyn is
closed during Stephens' engagement hereunder or if the Company or any
of its affiliates enters into an agreement during or within two years
after the termination of Stephens' engagement hereunder providing for
a Business Combination with Artesyn, and such Business Combination is
subsequently consummated. The amount of the success fee shall be
determined in accordance with the following table; provided that the
success fee shall be reduced by the amount of the fees previously paid
pursuant to section (i) immediately above.
Acquisition Premium Applicable Fee
30% or less $4,000,000
30-40% $3,500,000
40% or more $3,000,000
The acquisition premium is defined as the percentage increase between (i) the
average closing price per Artesyn share for the thirty trading days immediately
prior to the day this Engagement Letter is executed, and (ii) the price per
Artesyn share paid by the Company in a Business Combination. The success fee
shall he paid to Stephens on the closing date of the Business Combination.
September 1, 2004
Page 3
iii. In the event a Business Combination is not completed prior to the
occurrence of any of the events described in items (1), (2) and (3)
below, a disposition fee equal to 20% of the Company's gains, net of
all sales commissions and related fees, on all securities of Artesyn
purchased by the Company in the open market shall be paid to Stephens
immediately upon the earliest to occur of: (1) the sale or disposition
by the Company of any of the securities of Artesyn purchased by the
Company in the open market, (2) a merger or other business combination
between Artesyn and an entity that is not an affiliate of the Company,
or (3) the ninetieth day following termination of this Engagement
Agreement. If the company has not sold all of its securities of
Artesyn within 90 days of the termination of this Engagement
Agreement, then the effective sales price for calculating the
company's gains on any unsold shares will be equal to the average
closing price per Artesyn share for the thirty trading days
immediately prior to the ninetieth day after termination of this
Engagement Agreement. In no event shall the total disposition fee paid
to Stephens exceed $1,000,000.
In addition to the fees set forth herein (and regardless of whether a
Business Combination occurs), the Company shall reimburse Stephens, upon
request, for Stephens' out-of-pocket expenses incurred in connection with this
engagement, including travel expenses, database fees, overnight delivery and
courier fees, and the reasonable fees and disbursements of outside counsel.
Stephens will periodically provide invoices to the Company setting forth the
amount of such expenses. Additionally, Stephens shall notify the Company prior
to incurring total expenses in excess of $25,000, and the Company will have the
right to approve or disapprove additional expenditures above this threshold.
The Company will furnish Stephens (and will request Artesyn furnish
Stephens) with such information as Stephens believes appropriate to its
assignment (all such information so furnished being the "Information"). The
Company recognizes and confirms that Stephens: (i) will use and rely primarily
on the Information and on information available from generally recognized public
sources in performing the services contemplated by this letter; (ii) does not
assume responsibility for the accuracy or completeness of the Information and
such other information; (iii) will not inquire into the reliability of the
Information except to the limited extent necessary to provide a reasonable basis
for Stephens' analyses and opinion; and (iv) will not make an appraisal of any
assets or liabilities of the Company or Artesyn. The Company hereby warrants
that any Information relating to the Company that is furnished to Stephens by or
on behalf of the Company will be fair, accurate and complete in all material
respects and will not contain any material omissions or misstatements of fact.
The Company will promptly advise Stephens if any Information previously provided
becomes inaccurate or is required to be updated.
Please note that in the ordinary' course of business, Stephens and its
affiliates at any time may hold long or short positions, and may trade or
otherwise effect transactions as principal or for the accounts of customers, in
debt or equity securities or options on securities of the Company or any other
party that may be involved in a Business Combination.
September 1, 2004
Page 4
The Company agrees to indemnify and hold Stephens harmless in accordance
with the indemnification rider attached as Exhibit A. This agreement, including
the indemnification rider, incorporates the entire understanding of the parties
with respect to this engagement and supersedes all previous agreements, should
they exist.
If the Business Combination is completed and becomes a matter of public
record, Stephens shall be entitled, at its expense, to place announcements,
which may include the Company's corporate logo, in such newspapers and other
media as it may choose stating that Stephens acted as financial advisor to the
Company in the Business Combination. In addition, if requested by Stephens, the
Company shall include a mutually acceptable reference to Stephens in any press
release or other public announcement made by the Company regarding the matters
described in this letter.
This agreement has been and is made solely for the benefit of Stephens, the
Company, and of the persons, agents, employees, officers, directors and
controlling persons refer ed to in the indemnification rider and their
respective successors, assigns and heirs, and no other person shall acquire or
have any right under or by virtue of this agreement.
If this letter correctly states our agreement, please so indicate by
signing below and returning a signed copy to us. Upon receipt of a signed copy
of this letter, the terms of such letter shall constitute a binding agreement
between Stephens and the Company. We look forward to assisting you with your
investment in Artesyn.
Very truly yours,
STEPHENS INC.
By:_________________________________
James E. Johnson III
Vice President
ACCEPTED THIS 1st DAY OF SEPTEMBER, 2004.
BEL FUSE, INC.
By:_____________________
Title: President/CEO
EXHIBIT A
INDEMNIFICATION AND CONTRIBUTION
(a) The Company will indemnify and hold harmless Stephens Inc. ("Stephens")
and its affiliates, and their respective officers, directors, advisors,
representatives, agents, employees, and each other person controlling Stephens
or any of its affiliates within the meaning of either Section 15 of the
Securities Act of 1933, as amended, or Section 20 of the Securities Exchange Act
of 1934, as amended (each such party, including Stephens, an "Indemnified
Person"), from and against any and all losses, claims, damages and liabilities,
joint or several (collectively, "Damages"), related to or arising out of any
matter referred to in the engagement letter to which this Exhibit is appended
(the "Agreement"), including an Indemnified Person's services thereunder, except
to the extent such Damages are finally, judicially determined to have resulted
directly and primarily from the gross negligence or willful misconduct of an
Indemnified Person.
(b) The Company will also reimburse each Indemnified Person immediately
upon request for all expenses (including without limitation reasonable fees and
disbursements of legal counsel, and usual and customary expenses for an
Indemnified Person's involvement in discovery proceedings or testimony) incurred
in connection with any threatened or commenced inquiry, investigation, action or
legal, administrative or judicial proceeding (collectively, "Proceedings"),
related to or arising out of any matter referred to in the Agreement, including
an Indemnified Person's services thereunder. The reimbursement obligations
contained herein shall apply whether or not Stephens or any other Indemnified
Person is a formal party to any Proceeding and are intended to cover, among
other things, reimbursement of expenses incurred for reviewing, investigating or
responding to, or otherwise in connection with, any claims, demands,
allegations, discovery requests, depositions, investigative testimony, hearings,
arbitrations, trials, appeals or other proceedings related to or arising out of
any matter referred to in the Agreement, including an Indemnified Person's
services thereunder. In the event that any reimbursed expenses are finally,
judicially determined to have resulted directly and primarily from such
Indemnified Person's gross negligence or willful misconduct in performing the
services which are the subject of the Agreement, Stephens shall promptly refund
to the Company the portion of amounts advanced under this Exhibit in respect of
reimbursement of expenses which is attributable to expenses incurred in relation
to the act or omission of such Indemnified Person who is the subject of such
determination.
(c) The Company and Stephens agree that if, for any reason, any
indemnification or reimbursement sought pursuant to this Exhibit is unavailable
or is insufficient to hold any Indemnified Person harmless, then, whether or not
Stephens is the person entitled to indemnification, the Company and Stephens
shall each contribute to amounts paid or payable by the Indemnified Person in
respect of the Damages and expenses (including all legal and other fees and
expenses incurred in defending any action or claim) for which such
indemnification or reimbursement is unavailable or insufficient, in such
proportion as is appropriate to reflect (i) the relative benefits received (or
anticipated to be received) by the Company and its stockholders, on the one
hand, and Stephens, on the other, in connection with the transaction(s)
contemplated in the Agreement and (ii) such parties' relative fault in
connection with the matters as to which such Damages relate, as well as any
relevant equitable considerations; provided that in no event shall the amount to
be contributed by Stephens exceed the amount of fees actually received by
Stephens under the Agreement (excluding any amounts received by Stephens as
reimbursement of expenses). It is hereby agreed that the relative benefits to
the Company and its stockholders, on the one hand, and Stephens, on the other
hand, with respect to the Agreement shall be deemed to be in the same proportion
as (x) the total value paid, transferred, exchanged or received or proposed to
be paid, transferred, exchanged or received by the Company or its stockholders,
as the case may be, in connection with any transaction (whether or not
consummated) bears to (y) the fee(s) paid or payable to Stephens in connection
with the Agreement. The Company and Stephens agree that it would not be just and
equitable if contribution pursuant to this clause (c) were determined by pro
rata allocation or by any other method which does not take into account the
equitable considerations referred to herein.
(d) The Company also agrees that no Indemnified Person shall have any
liability to the Company for or in connection with the Agreement, except for
liability for Damages which are finally, judicially determined to have resulted
directly and primarily from the gross negligence or willful misconduct of the
Indemnified Person. In no event shall any Indemnified Person be responsible for
any indirect, special or consequential damages, even if the Indemnified Person
is advised of the possibility thereof.
(e) The Company will promptly notify an Indemnified Person of the assertion
against the Indemnified Person or any other person of any claim or the
commencement of any inquiry, investigation, action or proceeding, of which the
Company has knowledge, relating to or arising out of any matter referred to in
the Agreement, including an Indemnified Person's services under the Agreement.
Stephens will promptly notify the Company of the assertion of any claim for
which it contemplates seeking indemnity or contribution hereunder; provided,
however that no delay in giving such notification shall relieve the Company from
any of its obligations hereunder, except to the extent of any actual prejudice
arising out of such delay.
(f) The Company and Stephens agree to consult in advance with one another
with respect to the terms of any proposed waiver, release or settlement of any
Proceeding to which the Company or an Indemnified Person may be subject as a
result of the matters contemplated by the Agreement and further agree not to
enter into any such waiver, release or settlement without the prior written
consent of one another (which consent shall not be unreasonably withheld),
unless such waiver, release or settlement includes an unconditional release of
the Company or such Indemnified Person, as the case may be, from all liability
arising out of such Proceeding.
(g) The agreements of the Company under this Exhibit shall be in addition
to any liabilities the Company may otherwise have, shall be binding upon and
inure to the benefit of any successors, assigns, heirs and personal
representatives of the Company or an Indemnified Person, and shall apply whether
or not Stephens or any other Indemnified Person is a formal party to any
Proceeding.
(h) Any right to trial by jury with respect to any dispute as to the
respective rights and obligations of the Company and any Indemnified Person
hereunder is hereby waived.
(i) The foregoing agreements shall apply to any modification or extension
of the Agreement, and shall remain in full force and effect following the
termination of the Agreement, whether as a result of the completion of services
or otherwise.