Bel Fuse Inc. Announces Acquisition Completion & Financial Obligations

TL;DR

Bel Fuse just closed an acquisition and took on new debt. Big moves ahead.

AI Summary

On November 14, 2024, Bel Fuse Inc. entered into a Material Definitive Agreement related to the completion of an acquisition. The company also disclosed a direct financial obligation and an off-balance sheet arrangement. Specific details regarding the acquisition, financial obligations, and the counterparty were not fully elaborated in the provided text.

Why It Matters

This filing indicates significant corporate activity for Bel Fuse Inc., including the completion of an acquisition and the creation of new financial commitments, which could impact its future financial performance and strategic direction.

Risk Assessment

Risk Level: medium — The completion of an acquisition and the creation of financial obligations introduce financial and operational risks that require careful monitoring.

Key Players & Entities

• Bel Fuse Inc. (company) — Registrant
• November 14, 2024 (date) — Date of earliest event reported

FAQ

Key Financial Figures

• $0.10 — hich Registered Class A Common Stock ($0.10 par value) BELFA Nasdaq Global Selec
• $320 million — basis for (i) a cash purchase price of $320 million (subject to customary adjustments), plu
• $10 million — customary adjustments), plus (ii) up to $10 million in potential earnout payments for the 2
• $325.6 million — Bel paid an aggregate of approximately $325.6 million in cash in respect of the cash purchase
• $85.6 million — n through cash on hand of approximately $85.6 million and with approximately $240 million pro
• $240 million — ly $85.6 million and with approximately $240 million provided through incremental borrowings
• $5 million — ut Payments may become payable of up to $5 million for each of the fiscal 2025 and fiscal
• $2.5 million — ayment for such Earnout Period shall be $2.5 million. In the event that achievement for the
• $80 million — ion, will be a base amount equal to (x) $80 million (subject to adjustments to true-up the
• $175 million — nts described below, had provided for a $175 million 5-year senior secured revolving credit
• $325 million — m Revolving Amount from $175 million to $325 million in accordance with Section 2.10(b)(i)(A
• $300 million — the Credit Agreement was approximately $300 million. Pursuant to the Third Amendment, the

Filing Documents

• belfb20241105_8k.htm (8-K) — 70KB
• ex_747161.htm (EX-10.1) — 536KB
• ex_747163.htm (EX-10.2) — 57KB
• ex_747162.htm (EX-10.3) — 1122KB
• ex_743164.htm (EX-99.1) — 10KB
• logo.jpg (GRAPHIC) — 6KB
• 0001437749-24-035846.txt ( ) — 2225KB
• belfb-20241114.xsd (EX-101.SCH) — 4KB
• belfb-20241114_def.xml (EX-101.DEF) — 13KB
• belfb-20241114_lab.xml (EX-101.LAB) — 17KB
• belfb-20241114_pre.xml (EX-101.PRE) — 13KB
• belfb20241105_8k_htm.xml (XML) — 5KB

01. Entry into a Material Definitive Agreement

Item 1.01. Entry into a Material Definitive Agreement. The information set forth in Item 2.01 of this Current Report on Form 8-K under the caption "Shareholders' Agreement" is incorporated by reference into this Item 1.01. The information set forth in Item 2.03 of this Current Report on Form 8-K is incorporated by reference into this Item 1.01.

01. Completion of Acquisition or Disposition of Assets

Item 2.01. Completion of Acquisition or Disposition of Assets. Closing of Acquisition of Majority 80% Stake in Enercon Technologies, Ltd. As previously disclosed, on September 18, 2024, Bel Fuse Inc. (" Bel " or the " Company ") entered into a Share Purchase Agreement, dated as of September 19, 2024 (the " Purchase Agreement "), with Enercon Technologies, Ltd. (" Enercon "), FF3 Holdings, L.P., for itself and as Sellers' Representative (" FF3 "), and each of the other seller parties signatory thereto (together with FF3, each a " Seller " and collectively, the " Sellers "). The transactions contemplated by the Purchase Agreement (referred to collectively herein as the " Transaction ") closed on November 14, 2024 (the " Closing Date "). Under the terms of the Purchase Agreement, on the Closing Date, Bel acquired from the Sellers 80% of the issued and outstanding share capital of Enercon on a fully-diluted basis for (i) a cash purchase price of $320 million (subject to customary adjustments), plus (ii) up to $10 million in potential earnout payments for the 2025-2026 period (the " Earnout Payments "), as further described below. Bel may acquire the remaining 20% stake in Enercon and has the current intention to so purchase such remaining interest by early 2027 in accordance with the terms and subject to the conditions of the Shareholders' Agreement, as defined and described below. At the closing, Bel paid an aggregate of approximately $325.6 million in cash in respect of the cash purchase price (after giving effect to estimated adjustments taken at closing including for Enercon's cash, indebtedness, net working capital and unpaid transaction costs, and subject to further adjustment post-closing). Bel funded the closing of the Transaction through cash on hand of approximately $85.6 million and with approximately $240 million provided through incremental borrowings under the Company's revolving credit facility, as amended in connection with the Transaction. See Item

01. Regulation FD Disclosure

Item 7.01. Regulation FD Disclosure. On November 14, 2024, the Company issued a press release announcing the closing of the Transaction. A copy of the press release is attached hereto as Exhibit 99.1 and is incorporated herein by reference.

01. Financial Statements and Exhibits

Item 9.01. Financial Statements and Exhibits. (a) Financial statements of businesses or funds acquired. The Company intends to file the financial statements required by Item 9.01(a) by amendment to this Current Report on Form 8-K not later than 71 calendar days after the date that this Current Report on Form 8-K is required to be filed with respect to the closing of the Transaction. (b) Pro forma financial information. The Company intends to file the pro forma financial information relating to the Transaction required by Item 9.01(b) by amendment to this Current Report on Form 8-K not later than 71 calendar days after the date that this Current Report on Form 8-K is required to be filed with respect to the closing of the Transaction. (d) Exhibits. Exhibit No. Description 2.1 Share Purchase Agreement, dated as of September 19, 2024, by and among Bel Fuse Inc., Enercon Technologies Ltd., and the Shareholders of Enercon Technologies Ltd. (incorporated by reference to Exhibit 2.1 to the Company's Current Report on Form 8-K filed with the Securities and Exchange Commission on September 24, 2024)* 10.1 Shareholders' Agreement, dated November 14, 2024, by and among Bel Power Solutions s.r.o., FF3 Holdings, L.P., and Enercon Technologies Ltd.* 10.2 Third Amendment Agreement, dated November 14, 2024, to Amended and Restated Credit and Security Agreement, dated September 2, 2021, by and among Bel Fuse Inc., as the borrower, KeyBank National Association, as administrative agent, swing line lender and issuing lender, and the other lenders identified therein, as amended. 10.3 Conformed Amended and Restated Credit and Security Agreement, dated as of September 2, 2021 (reflecting changes thereto pursuant to First Amendment Agreement dated as of January 12, 2023, Second Amendment Agreement dated as of September 18, 2024, and Third Amendment Agreement dated as of November 14, 2024), by and among Bel Fuse Inc., as the borrower, KeyBank National Association, as a

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