SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(a)
OF THE SECURITIES EXCHANGE ACT OF 1934
(AMENDMENT NO. )
Filed by the Registrant |X|
Filed by a Party other than the Registrant |_|
Check the appropriate box:
|_| Preliminary Proxy Statement
|_| Confidential, for Use of the Commission Only (as permitted by
Rule 14a-6(e)(2))
|X| Definitive Proxy Statement
|_| Definitive Additional Materials
|_| Soliciting Material Pursuant to ss.240.14a-11(c) or ss.240.14a-12
BEL FUSE INC
--------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
--------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
|X| No fee required.
|_| Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
------------------------------------------------------------------------
(5) Total fee paid:
------------------------------------------------------------------------
|_| Fee paid previously with preliminary materials.
|_| Check box if any part of the fee is offset as provided by Exchange Act Rule
0-11 (a) (2) and identify the filing for which the offsetting fee was paid
previously. Identify the previous filing by registration statement number,
or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
------------------------------------------------------------------------
(2) Form, Schedule or Registration Statement No.:
------------------------------------------------------------------------
(3) Filing Party:
------------------------------------------------------------------------
(4) Date Filed:
------------------------------------------------------------------------
[GRAPHIC OMITTED]
NOTICE OF ANNUAL MEETING OF SHAREHOLDERS
OF
B E L F U S E I N C.
NOTICE IS HEREBY GIVEN that the Annual Meeting of Shareholders of Bel Fuse
Inc. will be held at the Hyatt Regency Jersey City, 2 Exchange Place, Jersey
City, New Jersey 07302, on Thursday, May 27, 2004 at 2:00 p.m. for the
following purposes:
1. To elect three directors for three year terms and one director for a
one year term.
2. To consider and act upon other matters which may properly come before
the meeting or any adjournment thereof.
The Board of Directors has fixed the close of business on April 14, 2004
as the date for determining the shareholders of record entitled to receive
notice of, and to vote at, the Annual Meeting.
By Order of the Board of Directors
COLIN DUNN, Secretary
Jersey City, New Jersey
April 21, 2004
---------------------
WE URGE YOU TO SIGN AND RETURN THE ENCLOSED PROXY AS PROMPTLY AS POSSIBLE,
WHETHER OR NOT YOU PLAN TO ATTEND THE MEETING IN PERSON. IF YOU DO ATTEND THE
MEETING, YOU MAY REVOKE YOUR PROXY AND VOTE IN PERSON.
---------------------
THIS NOTICE AND THE ACCOMPANYING PROXY STATEMENT ARE FURNISHED TO THE
HOLDERS OF THE COMPANY'S CLASS B COMMON STOCK, PAR VALUE $0.10 PER SHARE, FOR
INFORMATIONAL PURPOSES. HOLDERS OF CLASS B COMMON STOCK ARE NOT ENTITLED TO
VOTE AT THE ANNUAL MEETING IN ACCORDANCE WITH THE COMPANY'S CERTIFICATE OF
INCORPORATION, AS AMENDED.
B E L F U S E I N C.
----------------------
PROXY STATEMENT
---------------------
The following statement is furnished to the holders of the Class A Common
Stock, par value $0.10 per share (the "Class A Common Stock"), of Bel Fuse Inc.
("Bel" or the "Company"), a New Jersey corporation with its principal executive
offices at 206 Van Vorst Street, Jersey City, New Jersey 07302, in connection
with the solicitation by the Board of Directors of Bel of proxies to be used at
Bel's Annual Meeting of Shareholders. The Annual Meeting will be held at the
Hyatt Regency Jersey City, 2 Exchange Place, Jersey City, New Jersey 07302, on
Thursday, May 27, 2004 at 2:00 p.m. This Proxy Statement is also furnished to
the holders of Bel's Class B Common Stock, par value $0.10 per share (the
"Class B Common Stock"), for informational purposes. Holders of Class B Common
Stock are not entitled to vote at the Annual Meeting in accordance with Bel's
Certificate of Incorporation, as amended. This Proxy Statement and, as to
holders of the Class A Common Stock, the enclosed form of proxy are first being
sent to shareholders on or about April 21, 2004. As used in the remainder of
this Proxy Statement, the term "shareholders" shall refer to the holders of
Bel's Class A Common Stock.
VOTING; REVOCATION OF PROXIES
A form of proxy is enclosed for use at the Annual Meeting if a shareholder
is unable to attend in person. Each proxy may be revoked at any time before it
is exercised by giving written notice to the secretary of the meeting. A
subsequently dated proxy will, if properly presented, revoke a prior proxy. Any
shareholder may attend the meeting and vote in person whether or not he has
previously given a proxy. All shares represented by valid proxies pursuant to
this solicitation (and not revoked before they are exercised) will be voted as
specified in the form of proxy. If a proxy is signed but no specification is
given, the shares will be voted "FOR" the Board's nominees to the Board of
Directors.
PROXY SOLICITATION
The entire cost of soliciting these proxies will be borne by Bel. In
following up the original solicitation of the proxies by mail, Bel may make
arrangements with brokerage houses and other custodians, nominees and
fiduciaries to send proxies and proxy materials to the beneficial owners of
stock held of record by such persons and may reimburse them for their expenses
in so doing. If necessary, Bel may also use its officers and their assistants
to solicit proxies from the shareholders, either personally or by telephone or
special letter.
VOTE REQUIRED; SHARES ENTITLED TO VOTE; PRINCIPAL SHAREHOLDERS
The presence in person or by proxy of holders of a majority of the
outstanding shares of the Company's Class A Common Stock will constitute a
quorum for the transaction of business at the Company's Annual Meeting.
Assuming that a quorum is present, the election of directors will require the
affirmative vote of a plurality of the shares of Class A Common Stock
represented and entitled to vote at the Annual Meeting. For purposes of
determining the votes cast with respect to any matter presented for
consideration at the Annual Meeting, only those cast "for" or "against" are
included. Abstentions and broker non-votes are counted only for the purpose of
determining whether a quorum is present at the Annual Meeting. Holders of Class
A Common Stock are not entitled to cumulative voting in the election of
directors.
Holders of record of the Class A Common Stock at the close of business on
April 14, 2004 (the record date fixed by the Board of Directors) will be
entitled to receive notice of, and to vote at, the Annual Meeting. At the close
of business on the record date, there were 2,701,663 shares of Class A Common
Stock outstanding and entitled to vote at the meeting. Each such share is
entitled to one vote on all matters to come before the meeting.
The Company's management is not aware of any individual or entity that
owned of record or beneficially more than five percent of the Class A Common
Stock as of the record date other than Sybil Bernstein, Howard B. Bernstein,
FMR Corp. and Third Avenue Management LLC. Sybil Bernstein was the wife of
Elliot Bernstein, the Chairman of the Board and a Director of the Company until
his death in July 2001. Howard B. Bernstein is a Director of the Company. The
business address for Howard B. Bernstein is 206 Van Vorst Street, Jersey City,
New Jersey 07302. For information regarding the number of shares owned by
Howard B. Bernstein, see "Election of Directors."
NAME AND ADDRESS OF AMOUNT AND NATURE PERCENT OF
BENEFICIAL OWNER OF BENEFICIAL OWNERSHIP CLASS
------------------------------------- ------------------------- -----------
Sybil Bernstein ..................... 251,132(1) 9.3%
206 Van Vorst Street
Jersey City, NJ 07302
FMR Corp. ........................... 484,700(2) 17.941%
82 Devonshire Street
Boston, MA 02109
Third Avenue Management LLC ......... 276,650(3) 10.2%
622 Third Avenue
32nd Floor
New York, NY 10017-6715
---------------------
(1) The shares of Class A Common Stock beneficially owned by Ms. Bernstein
include: (i) 18,800 shares owned by a not-for-profit foundation of which
Ms. Bernstein is President and Trustee and (ii) 218,311 shares owned by
two family partnerships of which Ms. Bernstein is the general partner. Ms.
Bernstein also owns 724,484 shares of Class B Common Stock, or 8.5% of the
outstanding shares. The shares of Class B Common Stock beneficially owned
by Ms. Bernstein include: (i) 73,069 shares owned by a not-for-profit
foundation of which Ms. Bernstein is President and Trustee, and (ii)
633,690 shares owned by two family partnerships of which Ms. Bernstein is
the general partner.
(2) Pursuant to a filing made by FMR Corp. with the Securities and Exchange
Commission, Fidelity Management & Research Company ("Fidelity"), 82
Devonshire Street, Boston, MA 02109, a wholly-owned subsidiary of FMR
Corp. and a registered investment adviser, is the beneficial owner of the
shares listed above as the result of acting as investment advisor to
various investment companies. Pursuant to such filing, the ownership of
one investment company, Fidelity Low Priced Stock Fund, amounted to
381,500 shares or 14.121% of the Class A Common Stock outstanding. Edward
C. Johnson 3d, FMR Corp., through its control of Fidelity, and the funds
each has sole power to dispose of the 484,700 shares. The filing states
that the sole power to vote these shares resides with the boards of
trustees of the various funds.
(3) Pursuant to a filing made by Third Avenue Management LLC with the
Securities and Exchange Commission, Third Avenue Management LLC, a
registered investment advisor, has sole voting and dispositive power with
respect to the 276,650 shares.
2005 ANNUAL MEETING; NOMINATIONS
Shareholders intending to present proposals at the 2005 Annual Meeting of
Shareholders must deliver their written proposals to the Company no later than
December 22, 2004 in order for such proposals to be eligible for inclusion in
the Company's proxy statement and proxy card relating to next year's meeting
and no later than March 7, 2005 in order for such proposals to be considered at
next year's meeting (but not included in the proxy statement for such meeting).
2
ELECTION OF DIRECTORS
The Company's directors are elected on a staggered term basis, with each
class of directors being as nearly equal as possible, and standing for
re-election once in each three-year period. At the Annual Meeting, the holders
of the Class A Common Stock will elect three directors for three year terms and
one director for a one year term.
Unless a shareholder either indicates "withhold authority" on his proxy or
indicates on his proxy that his shares should not be voted for certain
nominees, it is intended that the persons named in the proxy will vote for the
election as directors of the nominees listed below to serve until the
expiration of their terms and thereafter until their successors shall have been
duly elected and shall have qualified. Discretionary authority is also
solicited to vote for the election of a substitute or substitutes for said
nominees if either of them, for any reason presently unknown, cannot be a
candidate for election.
The following sets forth information as of March 1, 2004 concerning the
nominees for election to the Board of Directors and comparable information with
respect to those directors whose terms of office will continue beyond the date
of the Annual Meeting. Unless otherwise indicated, positions have been held for
more than five years.
NOMINEES FOR DIRECTOR FOR TERMS WHICH
WILL EXPIRE AT THE 2007 ANNUAL MEETING
NAME AGE DIRECTOR SINCE BUSINESS EXPERIENCE
---------------------------- ----- ---------------- -----------------------------------------------------
Daniel Bernstein* .......... 50 1986 President (June 1992 to Present) and Chief Executive
Officer (May 2001 to Present) of the Company; Vice
President and Treasurer of the Company (prior years
to June 1992); Managing Director of the Company's
Macau subsidiary (1991 to Present).
Peter Gilbert .............. 56 1987 Director (1987 to Present) and Chairman of the
Board and Chief Executive Officer (1997 to Present)
of PCA Aerospace, Inc. (a manufacturer of machined
components for the aerospace industry); Executive
Vice President (2000 to May 2003) of PCA Industries
(manufacturer of cast aluminum automobile wheels);
President and Chairman of the Board (prior years to
1996) of Gilbert Manufacturing Co. (a manufacturer
of electrical components).
John S. Johnson ............ 74 1996 Independent consultant (April 1993 to Present) for
various companies, including the Company (during
1995); Corporate Controller of AVX Corporation
(manufacturer of electronic components) (1978 to
March 1993).
NOMINEE FOR DIRECTOR FOR A TERM WHICH
WILL EXPIRE AT THE 2005 ANNUAL MEETING
NAME AGE DIRECTOR SINCE BUSINESS EXPERIENCE
------------------- ----- ---------------- ------------------------------------------------------
Avi Eden .......... 56 -- Independent Consultant for Business Development,
including Mergers and Acquisitions (2004 to Present);
Vice Chairman of the Board of Directors, Executive
Vice President and General Counsel of Vishay
Intertechnology, Inc. (1996 to 2003); Of Counsel to
the law firm of Eckert Seamans Cherin & Mellott,
LLC (prior years).
3
CONTINUING DIRECTOR WHOSE TERM EXPIRES AT THE 2005 ANNUAL MEETING
NAME AGE DIRECTOR SINCE BUSINESS EXPERIENCE
--------------------------- ----- ---------------- -------------------------------------------------
Robert H. Simandl ......... 75 1967 Practicing Attorney; Member of the law firm of
Simandl & Gerr (January 1992 to January 1995);
member of the law firm of Robert H. Simandl,
Counselor of Law (prior years); Secretary of the
Company (prior years to May 2003).
CONTINUING DIRECTORS WHOSE TERMS EXPIRE AT THE 2006 ANNUAL MEETING
NAME AGE DIRECTOR SINCE BUSINESS EXPERIENCE
----------------------------- ----- ---------------- ---------------------------------------------------
Howard B. Bernstein* ........ 77 1954 Retired.
John F. Tweedy .............. 58 1996 Independent consultant (February 2000 to Present);
Director of Public Relations of GlobeSpan
Semiconductor Inc. (supplier of semiconductor
integrated circuit products) (January 1999 to
February 2000); Director of Corporate
Communications of Standard Microsystems Corp.
(supplier of semiconductor integrated circuit
products) (July 1995 to January 1999).
----------
*Daniel Bernstein is Howard B. Bernstein's nephew.
EXECUTIVE OFFICERS
The following sets forth information as of March 1, 2004 concerning the
Company's executive officers. Unless otherwise indicated, positions have been
held for more than five years.
OFFICER POSITIONS AND OFFICES WITH THE
NAME AND AGE SINCE COMPANY/BUSINESS EXPERIENCE
-------------------------------- --------- ---------------------------------------------------
Daniel Bernstein, 50 ........... 1985 President, Chief Executive Officer and Director
Colin Dunn, 59 ................. 1992 Vice President of Finance and Treasurer; Secretary
(May 2003 to present)
Joseph Meccariello, 53 ......... 1995 Vice President of Manufacturing
Dennis Ackerman, 41 ............ 2001 Vice President of Operations
Dwayne Vasquez, 41 ............. 2001 Vice President of Sales
Daniel Bernstein has served the Company as President since June 1992. He
previously served as Vice President (1985-1992) and Treasurer (1986-1992) and
has served as a Director since 1986. He has occupied other positions with the
Company since 1978. He was appointed Managing Director of the Company's Macau
subsidiary during 1991.
Colin Dunn joined the Company in 1991 as Finance Manager and in 1992 was
named Vice President of Finance and Treasurer. He was appointed Secretary of
the Company in May 2003. He is currently a director of Bel Fuse Ltd. and Bel
Fuse Macau LDA. Prior to joining the Company, Mr. Dunn was Vice President of
Finance and Operations at Kentek Information Systems, Inc. from 1985 to 1991
and had previously held a series of senior management positions with Braintech
Inc. and Weyerhaeuser Company.
Joseph Meccariello joined the Company in 1979 as a Manager of Mechanical
Engineering and in 1994 became the Deputy Managing Director of the Company's
Hong Kong subsidiary, Bel Fuse Ltd. In 1995 he was named Vice President of
Manufacturing with responsibility for Far East production operations.
Dennis Ackerman joined the Company in 1986 and has held the positions of
customer service manager, sales manager, purchasing manager and operations
manager. In 2001 he was named Vice President of Operations.
4
Dwayne Vasquez joined the Company in 2001 as Director of Sales. In October
2001 he was promoted to Vice President of Sales with responsibility for the
Company's worldwide sales organization. From 1997 to 2001 he was Director of
Sales and Marketing at Ericson Microelectronics, Power Module Division in
Richardson, Texas where he was responsible for driving revenue in the DC/DC and
board mounted power product markets.
BENEFICIAL OWNERSHIP OF THE COMPANY'S STOCK
The following table sets forth certain information regarding the ownership
of Bel's Class A Common Stock and Class B Common Stock as of March 1, 2004 by
(a) each director and nominee; (b) each of the Company's Chief Executive
Officer and the four other most highly compensated executive officers of Bel
during 2003 (the "Named Officers") and (c) all directors and executive officers
as a group. Unless otherwise stated in the footnotes following the table, the
nominees, directors, nominees and Named Officers listed in the table have sole
power to vote and dispose of the shares which they beneficially owned as of
March 1, 2004.
AGGREGATE NUMBER OF SHARES BENEFICIALLY OWNED (1)
----------------------------------------------------------------
CLASS A COMMON STOCK CLASS B COMMON STOCK
------------------------------- ------------------------------
PERCENT OF PERCENT OF
OUTSTANDING OUTSTANDING
NO. OF SHARES SHARES NO. OF SHARES SHARES
--------------- ------------- --------------- ------------
Daniel Bernstein (2) .......................... 116,076 4.3 347,410 4.1
Howard B. Bernstein (3) ....................... 140,000 5.2 349,000 4.1
Colin Dunn (4) ................................ 3,942 * 26,027 *
Avi Eden ...................................... -- -- -- --
Peter Gilbert (5) ............................. 500 * 6,000 *
John S. Johnson (6) ........................... 1,900 * 12,700 *
Joseph Meccariello (7) ........................ 328 * 17,997 *
Robert H. Simandl (8) ......................... 1,575 * 4,725 *
Dwayne Vasquez (9) ............................ -- -- 5,000 *
John F. Tweedy (10) ........................... 250 * 4,750 *
Dennis Ackerman (11) .......................... 850 * 12,797 *
All directors, nominees and executive
officers as a group (10 persons)(12) ......... 241,407 8.9 747,332 8.8
----------
(1) As of March 1, 2004, there were 2,701,663 and 8,515,192 shares of Class A
Common Stock and Class B Common Stock outstanding, respectively.
(2) The shares of Class A Common Stock beneficially owned by Daniel Bernstein
include 11,500 shares held by Mr. Bernstein as trustee for his children
and 1,577 shares allocated to Mr. Bernstein in the Company's 401(k) Plan
over which he has voting but no investment power. The shares of Class B
Common Stock beneficially owned by Daniel Bernstein include 24,000 shares
which may be acquired by him on or before May 1, 2004 upon the exercise of
stock options, 36,500 shares held by Mr. Bernstein as trustee for his
children and 6,913 shares allocated to Mr. Bernstein in the Company's
401(k) Plan over which he has no voting or investment power.
(3) The shares of Class B Common Stock beneficially owned by Mr. Bernstein
include 2,000 shares which may be acquired by him on or before May 1, 2004
upon the exercise of stock options.
(4) The shares of Class A Common Stock beneficially owned by Colin Dunn
include 1,014 shares which may be acquired by him on or before May 1, 2004
upon the exercise of stock options and 1,178 shares allocated to him in
the Company's 401(k) Plan over which he has voting but no investment
power. The shares of Class B Common Stock beneficially owned by Mr. Dunn
include 10,986 shares which may be acquired by him on or before May 1,
2004 upon the exercise of stock options and 5,291 shares allocated to him
in the Company's 401(k) Plan over which he has no voting or investment
power.
(5) The shares of Class B Common Stock beneficially owned by Mr. Gilbert
include 1,250 shares held of record by Mr. Gilbert's wife and 2,000 shares
which may be acquired by him on or before May 1, 2004 upon the exercise of
stock options.
(6) The shares of Class A Common Stock beneficially owned by Mr. Johnson
include 150 shares held by Mr. Johnson as custodian for his grandchildren.
The shares of Class B Common Stock beneficially owned by Mr. Johnson
include 2,000 shares which may be acquired by him on or before May 1, 2004
upon the exercise of stock options and 1,450 shares held by Mr. Johnson as
custodian for his grandchildren.
5
(7) The shares of Class A Common Stock beneficially owned by Mr. Meccariello
include 288 shares allocated to him in the Company's 401(k) Plan over
which he has voting but no investment power. The shares of Class B Common
Stock beneficially owned by Mr. Meccariello include 8,000 shares which may
be acquired by him on or before May 1, 2004 upon the exercise of stock
options, 720 shares held of record by Mr. Meccariello's wife, 414 shares
allocated to him in the Far East Plan over which he has no voting or
investment power and 863 shares allocated to him in the Company's 401(k)
Plan over which he has no voting or investment power.
(8) The shares of Class A Common Stock beneficially owned by Mr. Simandl
include 1,200 shares held of record by Mr. Simandl's wife. The shares of
Class B Common Stock beneficially owned by Mr. Simandl include 2,000
shares which may be acquired by him on or before May 1, 2004 upon the
exercise of stock options and 3,600 shares held of record by Mr. Simandl's
wife.
(9) Includes 5,000 shares of Class B Common Stock which may be acquired by Mr.
Vasquez on or before May 1, 2004 upon the exercise of stock options.
(10) Includes 2,000 shares of Class B Common Stock which may be acquired by Mr.
Tweedy on or before May 1, 2004 upon the exercise of stock options.
(11) The shares of Class A Common Stock beneficially owned by Mr. Ackerman
include 850 shares allocated to him in the Company's 401(k) Plan over
which he has voting but no investment power. The shares of Class B Common
Stock owned by Mr. Ackerman include 9,000 shares which may be acquired by
him on or before May 1, 2004 upon the exercise of stock options, and 3,797
shares allocated to him in the Company's 401(k) Plan over which he has no
voting or investment power.
(12) Includes 1,014 shares of Class A Common Stock and 66,986 shares of Class B
Common Stock which may be acquired on or before May 1, 2004 upon the
exercise of stock options and 3,893 and 17,285 shares of Class A Common
Stock and Class B Common Stock, respectively, allocated in the Company's
401(k) Plan and Far East Plan over which such persons have with respect to
the Class A Common Stock, voting but no investment power and with respect
to the Class B Common Stock, no voting or investment power.
* Shares constitute less than one percent of the shares of Class A Common Stock
or Class B Common Stock outstanding.
SECTION 16(a) BENEFICIAL OWNERSHIP REPORTING COMPLIANCE
Section 16(a) of the Securities Exchange Act of 1934 requires the
Company's directors, executive officers and greater than 10 percent beneficial
owners to file with the Securities and Exchange Commission certain reports
regarding such persons' ownership of the Company's securities. Directors,
officers and greater than 10 percent beneficial owners are required by
applicable regulations to furnish Bel with copies of all Section 16(a) forms
they file. Based solely upon a review of the copies of the forms or information
furnished to Bel, the Company believes that during 2003 all filing requirements
applicable to its directors, officers and greater than 10 percent beneficial
owners were satisfied on a timely basis, except that Daniel Bernstein
(President, Chief Executive Officer and a director of the Company) did not file
on a timely basis a report disclosing option exercises of Class A Common Stock
and Class B Common Stock that occurred on August 19, 2003 and the sale of the
shares acquired on exercise that occurred on August 20, 2003, and Howard
Bernstein (a director of the Company) did not file on a timely basis a report
disclosing sales of Class B Common Stock that occurred on November 11-13, 2003.
These late filings were inadvertent, and the required filings were made
promptly after noting the failure to file.
SUMMARY OF CASH AND CERTAIN OTHER COMPENSATION
The following table sets forth, for the fiscal years ended December 31,
2001, 2002 and 2003, the annual and long-term compensation of the Company's
Chief Executive Officer and the four other most highly compensated executive
officers of Bel during 2003 (the "Named Officers"):
6
SUMMARY COMPENSATION TABLE
LONG-TERM
ANNUAL COMPENSATION COMPENSATION AWARDS
------------------------------------- -----------------------
FISCAL OTHER(1) SECURITIES UNDERLYING ALL OTHER
NAME AND PRINCIPAL POSITION YEAR SALARY BONUS COMPENSATION OPTIONS/SARS(#) COMPENSATION(2)
----------------------------- ------- ----------- ---------- -------------- ----------------------- ----------------
Daniel Bernstein ............ 2003 $204,888 $63,028 -- -- $ 6,496
President and 2002 204,881 4,268 -- -- 10,496
Chief Executive Officer 2001 204,867 -- -- -- 10,496
Colin Dunn .................. 2003 164,256 50,538 -- -- 5,278
Vice President and 2002 164,225 3,422 -- -- 5,277
Treasurer 2001 164,233 -- -- -- 5,277
Joseph Meccariello .......... 2003 157,077 49,094 $57,076 -- 10,995
Vice President 2002 157,077 3,422 64,266 -- 10,995
2001 153,532 -- 79,230 -- 10,753
Dwayne Vasquez (3) .......... 2003 150,000 14,423 -- -- 4,850
Vice President 2002 150,012 3,125 -- -- 4,850
2001 137,099 -- -- 10,000 4,500
Dennis Ackerman ............. 2003 143,848 46,461 -- -- 4,880
Vice President 2002 116,644 2,430 -- -- 3,849
2001 116,644 -- -- -- 3,849
----------
(1) During the periods presented above, no Named Officer received perquisites
(i.e., personal benefits) in excess of 10% of such individual's reported
salary and bonus, except that Mr. Meccariello received housing allowances
of $51,692, $58,882 and $73,846, during 2003, 2002 and 2001, respectively,
and a travel allowance of $5,384 during 2003, 2002 and 2001.
(2) Compensation reported under this column for 2003 includes: (i)
contributions of $10,995 for Joseph Meccariello to the Company's Far East
Retirement Plan and contributions of $6,496, $5,278, $4,850 and $4,880,
for Daniel Bernstein, Colin Dunn, Dwayne Vasquez and Dennis Ackerman,
respectively, to the Company's 401(k) Plan, to match 2003 pre-tax elective
deferral contributions (included under "Salary") made by each Named
Officer to such Plans, such contributions currently being made in shares
of the Company's Class B Common Stock.
(3) Dwayne Vasquez became an executive officer of the Company in October 2001.
EMPLOYMENT AGREEMENT
Pursuant to an employment agreement previously entered into by the Company
and Mr. Elliot Bernstein, the Company's former Chairman of the Board, who died
in July 2001, the Company continued to pay to Mr. Bernstein's estate his salary
at the time of his death of $350,000 per year, through December 31, 2003.
STOCK OPTIONS
The Company maintains a Stock Option Plan (the "Plan") for employees. The
options granted under the Plan generally have terms of five years and terminate
at or within a specified period of time after the optionee's employment with
the Company ends. Options are exercisable in installments determined at the
date of grant. No stock options were granted to the Named Officers during the
year ended December 31, 2003.
OPTION EXERCISES AND HOLDINGS
The following table provides data regarding option exercises by the Named
Officers during 2003 and the number of shares covered by both exercisable and
non-exercisable stock options at December 31, 2003. Also reported are the
values for "in-the-money" options, which represent the positive spread between
the exercise price of existing options and either $29.90 or $32.63, the closing
sale price of the Company's Class A Common Stock or Class B Common Stock,
respectively, on December 31, 2003.
7
AGGREGATE OPTION/SAR EXERCISES IN LAST FISCAL YEAR
AND FISCAL YEAR-END OPTION/SAR VALUES
NUMBER OF
CLASS A/CLASS B VALUE OF
SHARES OF VALUE REALIZED SECURITIES UNDERLYING UNEXERCISED
CLASS A/ (MARKET PRICE UNEXERCISED IN-THE-MONEY
CLASS B STOCK ON EXERCISE OPTIONS/SARS AT YEAR END(#) OPTIONS/SARS AT YEAR END ($)
ACQUIRED ON DATE LESS ----------------------------- ----------------------------
NAME EXERCISE(#) EXERCISE PRICE)($) EXERCISABLE UNEXERCISABLE EXERCISABLE UNEXERCISABLE
------------------------ --------------- ------------------- ------------- --------------- ------------- --------------
Daniel Bernstein ....... 25,000/ 416,000/ --/ --/ --/ --/
25,000 489,500 24,000 8,000 334,320 111,440
Colin Dunn ............. 438/ 4,998/ 1,014/ --/ 24,235/ --/
25,250 562,364 10,986 4,000 171,711 62,520
Joseph Meccariello ..... --/ --/ --/ --/ --/ --/
-- -- 12,000 4,000 187,560 62,520
Dwayne Vasquez ......... --/ --/ --/ --/ --/ --/
-- -- 9,000 3,000 140,670 46,890
Dennis Ackerman ........ --/ --/ --/ --/ --/ --/
-- -- 5,000 5,000 15,650 15,650
EQUITY COMPENSATION PLAN INFORMATION
The following table provides information as of December 31, 2003 with
respect to shares of Class A and Class B Common Stock that may be issued under
the Company's existing equity compensation plans, which consist of the 2002
Equity Compensation Program and the Company's prior stock option plan (which
prior plan expired in April 2002), each of which has been approved by the
Company's stockholders.
(C)
NUMBER OF SECURITIES
(A) (B) REMAINING AVAILABLE FOR
NUMBER OF SECURITIES TO WEIGHTED-AVERAGE FUTURE ISSUANCE UNDER
BE ISSUED UPON EXERCISE EXERCISE PRICE OF EQUITY COMPENSATION PLANS
OF OUTSTANDING OPTIONS, OUTSTANDING OPTIONS, (EXCLUDING SECURITIES
PLAN CATEGORY WARRANTS AND RIGHTS WARRANTS AND RIGHTS REFLECTED IN COLUMN (A))
----------------------------------------- ------------------------- ---------------------- --------------------------
Equity Compensation Plans Approved Class A: 1,014 Class A: $17.00 Class A: --
by Security Holders .................... Class B: 711,586 Class B: $21.62 Class B: 925,000
Equity Compensation Plans Not
Approved by Security Holders ......... -- -- --
------------------------- ---------------------- --------------------------
Class A: 1,014 Class A: $17.00 Class A: --
TOTAL .................................. Class B: 711,586 Class B: $21.62 Class B: 925,000
THE BOARD OF DIRECTORS; COMMITTEES OF THE BOARD; DIRECTORS' COMPENSATION
Since the adoption of the Sarbanes-Oxley Act in July 2002, there has been
a growing public and regulatory focus on the independence of directors.
Recently, Nasdaq adopted amendments to its definition of independence.
Additional requirements relating to independence are imposed by the
Sarbanes-Oxley Act with respect to members of the Audit Committee. As noted
below, the Board has determined that the members of the Audit Committee satisfy
all such definitions of independence. The Board has also determined that the
following members of the Board satisfy the Nasdaq definition of independence:
Howard Bernstein, Peter Gilbert, John S. Johnson, John F. Tweedy, Robert
Simandl and, if elected, Avi Eden.
The Company's Board of Directors holds a regular meeting immediately
before the Annual Meeting of Shareholders and meets regularly throughout the
year. During 2003, the Board held six meetings.
Bel's Board has an Executive Committee, a Compensation Committee and an
Audit Committee. The Executive Committee is composed of Daniel Bernstein,
Robert H. Simandl and John F. Tweedy; the Compensation Committee is composed of
Peter Gilbert and Robert H. Simandl; and the Audit
8
Committee is composed of Peter Gilbert, John S. Johnson and John F. Tweedy. The
function of the Executive Committee is to act in the place of the Board when
the Board cannot be convened. The Nominating Committee, formed on May 22, 2003,
is composed of Howard Bernstein, Robert H. Simandl and John F. Tweedy.
The Compensation Committee is charged with the responsibility of
administering the Company's Stock Option Plan and also reviews the compensation
of Bel's executive officers.
The Audit Committee reviews significant audit and accounting principles,
policies and practices, and meets with the Company's independent auditors. The
Board of Directors has determined that John S. Johnson constitutes an "audit
committee financial expert", as such term is defined by the SEC. As noted
above, Mr. Johnson -- as well as the other members of the Audit Committee --
has been determined to be "independent" within the meaning of SEC and Nasdaq
regulations.
During 2003, the Executive Committee held no meetings, the Audit Committee
held six meetings, the Compensation Committee held one meeting and the
Nominating Committee held one meeting.
In 2003, non-employee directors of the Company received an annual retainer
of $12,000, plus $1,000 for each Board meeting they attended and $500 for each
committee meeting they attended. In 2003, directors who were executive officers
of the Company did not receive directors' fees. In 2003, directors of the
Company's foreign subsidiaries did not receive a retainer.
In 2003, each non-employee director of the Company was granted an option
to purchase 8,000 shares of Class B Common Stock in consideration of such
person's service as a director. For a description of legal services provided to
the Company by Robert H. Simandl during 2003, see "Compensation Committee
Interlocks and Insider Participation."
NOMINATING COMMITTEE MATTERS
Nominating Committee Charter. The Board has adopted a Nominating Committee
charter to govern its Nominating Committee. A copy of the Nominating
Committee's charter is attached hereto as Appendix A.
Independence of Nominating Committee Members. All members of the
Nominating Committee of the Board of Directors have been determined to be
"independent directors" pursuant to the definition contained in Rule
4200(a)(15) of the National Association of Securities Dealers' Marketplace
rules.
Procedures for Considering Nominations Made by Shareholders. The
Nominating Committee's charter describes procedures for nominations to be
submitted by shareholders and other third-parties, other than candidates who
have previously served on the Board or who are recommended by the Board. The
charter states that a nomination must be delivered to the Secretary of the
Company at the principal executive offices of the Company not later than the
close of business on the 90th day nor earlier than the close of business on the
120th day prior to the first anniversary of the preceding year's annual
meeting; provided, however, that if the date of the annual meeting is more than
30 days before or more than 60 days after such anniversary date, notice to be
timely must be so delivered not earlier than the close of business on the 120th
day prior to such annual meeting and not later than the close of business on
the later of the 90th day prior to such annual meeting or the close of business
on the 10th day following the day on which public announcement of the date of
such meeting is first made by the Company. The public announcement of an
adjournment or postponement of an annual meeting will not commence a new time
period (or extend any time period) for the giving of a notice as described
above. The charter requires a nomination notice to set forth as to each person
whom the proponent proposes to nominate for election as a director: (a) all
information relating to such person that is required to be disclosed in
solicitations of proxies for election of directors in an election contest, or
is otherwise required, in each case pursuant to Regulation 14A under the
Securities Exchange Act of 1934, as amended (including such person's written
consent to being named in the proxy statement as a nominee and to serving as a
director if elected), and (b) information that will enable the Nominating
Committee to determine whether the candidate or candidates satisfy the criteria
established pursuant to the charter for director candidates.
9
Qualifications. The charter describes the minimum qualifications for
nominees and the qualities or skills that are necessary for directors to
possess. Each nominee:
o must satisfy any legal requirements applicable to members of the
Board;
o must have business or professional experience that will enable such
nominee to provide useful input to the Board in its deliberations;
o must have a reputation for honesty and ethical conduct;
o must have a working knowledge of the types of responsibilities
expected of members of the board of directors of a public company; and
o must have experience, either as a member of the board of directors of
another public or private company or in another capacity, that
demonstrates the nominee's capacity to serve in a fiduciary position.
Identification and Evaluation of Candidates for the Board. Candidates to
serve on the Board will be identified from all available sources, including
recommendations made by shareholders. The Nominating Committee's charter
provides that there will be no differences in the manner in which the
Nominating Committee evaluates nominees recommended by shareholders and
nominees recommended by the Committee or management, except that no specific
process shall be mandated with respect to the nomination of any individuals who
have previously served on the Board. The evaluation process for individuals
other than existing Board members will include:
o a review of the information provided to the Nominating Committee by
the proponent;
o a review of reference letters from at least two sources determined to
be reputable by the Nominating Committee; and
o a personal interview of the candidate,
together with a review of such other information as the Nominating Committee
shall determine to be relevant.
Third Party Recommendations. In connection with the 2004 Annual Meeting,
the Nominating Committee did not receive any nominations from any shareholder
or group of shareholders which owned more than 5% of the Company's Class A
Common Stock or Class B Common Stock for at least one year.
AUDIT COMMITTEE MATTERS
Audit Committee Charter. The Audit Committee performed its duties during
2003 under a written charter approved by the Board of Directors, which is
attached to this proxy statement as Appendix B.
Independence of Audit Committee Members. The Class A and Class B Common
Stock are listed on the Nasdaq National Market and the Company is governed by
the listing standards applicable thereto. All members of the Audit Committee of
the Board of Directors have been determined to be "independent directors"
pursuant to the definition contained in Rule 4200(a)(15) of the National
Association of Securities Dealers' Marketplace Rules and under the SEC's Rule
10A-3.
Audit Committee Report. In connection with the preparation and filing of
the Company's Annual Report on Form 10-K for the year ended December 31, 2003:
(1) the Audit Committee reviewed and discussed the audited financial
statements with the Company's management;
(2) the Audit Committee discussed with the Company's independent
auditors the matters required to be discussed by SAS 61;
(3) the Audit Committee received and reviewed the written disclosures
and the letter from the Company's independent auditors required by the
Independence Standards Board Standard No. 1 (Independence Discussions with
Audit Committees) and discussed with the Company's independent auditors
any relationships that may impact their objectivity and independence and
satisfied itself as to the auditors' independence; and
10
(4) based on the review and discussions referred to above, the Audit
Committee recommended to the Board that the audited financial statements
be included in the 2003 Annual Report on Form 10-K.
By: The Audit Committee of the Board of Directors
Peter Gilbert
John S. Johnson
John F. Tweedy
SHAREHOLDER COMMUNICATION WITH THE BOARD
The Board of Directors has established a procedure that enables
shareholders to communicate in writing with members of the Board. Any such
communication should be addressed to the Company's Chief Executive Officer and
should be sent to such individual c/o Bel Fuse Inc., 206 Van Vorst Street,
Jersey City, New Jersey 07302. Any such communication must state, in a
conspicuous manner, that it is intended for distribution to the entire Board of
Directors. Under the procedures established by the Board, upon the Chief
Executive Officer's receipt of such a communication, the Company's Secretary
will send a copy of such communication to each member of the Board, identifying
it as a communication received from a shareholder. Absent unusual
circumstances, at the next regularly scheduled meeting of the Board held more
than two days after such communication has been distributed, the Board will
consider the substance of any such communication.
Board members are encouraged, but not required by any specific Board
policy, to attend the Company's annual meeting of shareholders. All of the
members of the Board attended the Company's 2003 annual meeting of
shareholders.
PERFORMANCE GRAPH
The following graph compares the cumulative total return on a hypothetical
$100 investment made at the close of business on December 31, 1998 in Bel's
Common Stock and, since the Company's recapitalization effected July 9, 1998,
in Bel's Class A Common Stock and Class B Common Stock with the Nasdaq Stock
Index and the Nasdaq Electronic Components Stock Index. The graph is calculated
assuming that all dividends are reinvested during the relevant periods. The
graph shows how a $100 investment in either the Class A Common Stock or the
Class B Common Stock would increase or
11
decrease in value over time, based on dividends and increases or decreases in
market prices. The market prices of the Class A Common Stock and the Class B
Common Stock were averaged.
[GRAPHIC OMITTED]
COMPENSATION COMMITTEE REPORT ON EXECUTIVE COMPENSATION
Decisions on compensation of Bel's executive officers generally are made
by the Compensation Committee of the Board of Directors (the "Committee").
Pursuant to Securities and Exchange Commission rules designed to enhance
disclosure of corporate policies regarding executive compensation, Bel has set
forth below a report submitted by the Committee addressing Bel's compensation
policies for 2003 as they affected Daniel Bernstein, the Chief Executive
Officer, and the other Named Officers.
12
The goals of Bel's compensation policies for executive officers are to
provide a competitive level of base salary and other benefits to attract,
retain and motivate high caliber personnel.
The Company's compensation program consists primarily of base salary and
long-term incentive awards. In making its compensation decisions, the Committee
analyzes the Company's performance, the individual's performance in terms of
the fulfillment of responsibilities related to the applicable position, and the
individual's contribution to the Company.
Executive officers receive performance and salary reviews each year.
Salary increases are based on an evaluation of the extent to which a particular
executive officer is determined to have assisted the Company in meeting its
business objectives and in contributing to the growth and performance of the
Company.
Daniel Bernstein's salary and Colin Dunn's salary remained virtually
unchanged from 2002 to 2003. Bonuses to the Named Officers were increased in
2003, reflecting the improvement in the Company's performance and the
contributions made by various individuals, including Daniel Bernstein and Colin
Dunn, to such performance.
The Company's long-term incentive award program includes the grant of
stock options. Stock options only produce value to executives if the price of
the Company's stock appreciates, thereby directly linking the interests of
executives with those of stockholders. All of the Company's outstanding stock
options have been granted at exercise prices at least equal to the market price
on the grant date. None of the Named Officers was granted a stock option during
2003.
Pursuant to the Company's domestic 401(k) Plan and Far East Retirement
Plan, the Company makes matching contributions of pre-tax elective deferral
contributions made by employees, including executive officers. The Company's
matching contributions under the 401(k) Plan are currently made in shares of
Bel's Class B Common Stock and under the Far East Retirement Plan are currently
made partly in shares of Bel's Class B Common Stock (approximately 10% of the
Company's contribution) and partly in cash (approximately 90% of the
contribution). Bel believes that these plans are an important element in
executive long-term compensation and foster the retention and motivation of
qualified executives.
During 1993, the Omnibus Reconciliation Act of 1993 was enacted. This Act
includes potential limitations on the deductibility of compensation in excess
of $1 million paid to the Company's five highest paid officers beginning in
1994. Based on regulations issued by the Internal Revenue Service and an
analysis by the Company to date, the Company believes that any compensation
realized in connection with the exercise of stock options granted by the
Company will continue to be deductible as performance-based compensation. The
Committee and the entire Board of Directors will continue to evaluate the
impact of this legislation on Bel's compensation program and intends to submit
appropriate proposals to stockholders at future meetings if necessary in order
to maintain the deductibility of executive compensation.
Respectfully submitted,
Robert H. Simandl
Peter Gilbert
COMPENSATION COMMITTEE INTERLOCKS AND INSIDER PARTICIPATION
Peter Gilbert and Robert H. Simandl served as members of the Compensation
Committee of the Company's Board of Directors during 2003.
Mr. Simandl served as the Company's Secretary through May 2003. Mr.
Simandl and his predecessor firms have served as general counsel to the Company
for more than five years. Fees received by Mr. Simandl's firm from the Company
during 2003 were not material. The Company will retain Mr. Simandl in 2004.
RELATIONSHIP WITH INDEPENDENT PUBLIC ACCOUNTANTS
Deloitte & Touche LLP, independent certified public accountants, has been
selected by the Board of Directors to audit and report on Bel's financial
statements for the year ending December 31, 2004.
13
Deloitte & Touche LLP began auditing Bel in 1983. A representative of Deloitte
& Touche LLP is expected to be present at the Annual Meeting and will have an
opportunity to make a statement if he so desires. The representative is
expected to be available to respond to appropriate questions from shareholders.
AUDIT FEES AND RELATED MATTERS
In accordance with the requirements of the Sarbanes-Oxley Act of 2002 and
the Audit Committee's charter, all audit and audit-related work and all
non-audit work performed by the Company's independent accountants, Deloitte &
Touche LLP ("Deloitte"), is approved in advance by the Audit Committee,
including the proposed fees for such work. The Audit Committee is informed of
each service actually rendered.
Audit Fees. Audit fees billed or expected to be billed to the Company by
Deloitte for the audit of the financial statements included in the Company's
Annual Reports on Form 10-K, and reviews of the financial statements included
in the Company's Quarterly Reports on Form 10-Q, for the years ended December
31, 2002 and 2003 totaled approximately $251,000 and $396,625, respectively.
Audit-Related Fees. The Company was billed $-0- and $53,911 by Deloitte
for the fiscal years ended December 31, 2002 and 2003, respectively, for
assurance and related services that are reasonably related to the performance
of the audit or review of the Company's financial statements and are not
reported under the caption "Audit Fees" above.
Tax Fees. The Company was billed an aggregate of $278,000 and $321,370 by
Deloitte for the fiscal years ended December 31, 2002 and 2003, respectively,
for tax services, principally advice regarding the preparation of income tax
returns.
All Other Fees. The Company was billed an aggregate of $-0- and $-0- by
Deloitte for the fiscal years ended December 31, 2002 and 2003, respectively,
for permitted non-audit services.
Other Matters. The Audit Committee of the Board of Directors has
considered whether the provision of the Audit-Related Fees, Tax Fees and All
Other Fees are compatible with maintaining the independence of the Company's
principal accountant.
Applicable law and regulations provide an exemption that permits certain
services to be provided by the Company's outside auditors even if they are not
pre-approved. The Company has not relied on this exemption at any time since
the Sarbanes-Oxley Act was enacted.
OTHER MATTERS
At the time this Proxy Statement was mailed to shareholders, management
was not aware that any matter other than the election of directors would be
presented for action at the Annual Meeting. If other matters properly come
before the Meeting, it is intended that the shares represented by proxies will
be voted with respect to those matters in accordance with the best judgment of
the persons voting them.
By Order of the Board of Directors
Colin Dunn, Secretary
Dated: April 21, 2004
A COPY OF THE COMPANY'S ANNUAL REPORT FOR THE YEAR ENDED DECEMBER 31,
2003, INCLUDING FINANCIAL STATEMENTS, ACCOMPANIES THIS PROXY STATEMENT. THE
ANNUAL REPORT IS NOT TO BE REGARDED AS PROXY SOLICITING MATERIAL OR AS A
COMMUNICATION BY MEANS OF WHICH ANY SOLICITATION IS TO BE MADE.
A COPY OF THE COMPANY'S ANNUAL REPORT ON FORM 10-K FOR THE YEAR ENDED
DECEMBER 31, 2003, FILED WITH THE SECURITIES AND EXCHANGE COMMISSION, IS
AVAILABLE (EXCLUDING EXHIBITS) WITHOUT COST TO SHAREHOLDERS UPON WRITTEN
REQUEST MADE TO JERRY KIMMEL, BEL FUSE INC., 206 VAN VORST STREET, NEW JERSEY
07302.
14
APPENDIX A
BEL FUSE INC.
NOMINATING COMMITTEE CHARTER
PURPOSES OF THE NOMINATING COMMITTEE
------------------------------------
The purposes of the Nominating Committee are:
o to consider proposals made by shareholders and others to nominate
specific individuals to the board of directors of Bel Fuse Inc. (the
"Company");
o to identify qualified individuals for membership on such board (the
"Board"); and
o to recommend to the Board the director nominees for election at each
annual meeting of shareholders and at each other meeting of
shareholders at which directors are to be elected.
MEMBERSHIP OF THE NOMINATING COMMITTEE
--------------------------------------
The Nominating Committee:
o shall consist of not less than three members of the Board, the exact
number to be established by the board of directors from time to time;
o shall consist solely of individuals who meet the independence
standards set forth in Securities and Exchange Commission rules and in
the listing standards applicable to the Company, except to the extent
that such listing standards permit one member of such committee not to
meet such independence standards; and
o shall consist solely of members who are appointed by, and who may be
removed by, the Board.
CRITERIA FOR NOMINATION TO THE BOARD OF DIRECTORS
-------------------------------------------------
Each individual nominated by the Nominating Committee to serve on the
Board of Directors shall, in the Nominating Committee's opinion, satisfy the
following criteria (the "Minimum Criteria") together with such other criteria
as shall be established by the Nominating Committee:
o such nominee shall satisfy any legal requirements applicable to
members of the Board;
o such nominee shall have business or professional experience that will
enable such nominee to provide useful input to the Board in its
deliberations;
o such nominee shall have a reputation for honesty and ethical conduct;
o such nominee shall have a working knowledge of the types of
responsibilities expected of members of the board of directors of a
public corporation; and
o such nominee shall have experience, either as a member of the board of
directors of another public or private corporation or in another
capacity, that demonstrates the nominee's capacity to serve in a
fiduciary position.
PROCEDURES TO BE FOLLOWED WITH RESPECT TO THE SUBMISSION OF NAMES FOR
---------------------------------------------------------------------
CONSIDERATION BY THE NOMINATING COMMITTEE.
------------------------------------------
The following procedures (the "Minimum Procedures") shall be utilized in
considering any candidate for election to the Board at an annual meeting, other
than candidates who have previously served on the Board or who are recommended
by the Board. A nomination must be delivered to the Secretary of the Company at
the principal executive offices of the Company not later than the close of
business on the ninetieth (90th) day nor earlier than the close of business on
the one hundred twentieth (120th) day prior to the first anniversary of the
preceding year's annual meeting; provided, however, that
A-1
if the date of the annual meeting is more than thirty (30) days before or more
than sixty (60) days after such anniversary date, notice to be timely must be
so delivered not earlier than the close of business on the one hundred
twentieth (120th) day prior to such annual meeting and not later than the close
of business on the later of the ninetieth (90th) day prior to such annual
meeting or the close of business on the tenth (10th) day following the day on
which public announcement of the date of such meeting is first made by the
Company. In no event shall the public announcement of an adjournment or
postponement of an annual meeting commence a new time period (or extend any
time period) for the giving of a notice as described above. Such notice shall
set forth as to each person whom the proponent proposes to nominate for
election as a director (a) all information relating to such person that is
required to be disclosed in solicitations of proxies for election of directors
in an election contest, or is otherwise required, in each case pursuant to
Regulation 14A under the Securities Exchange Act of 1934, as amended (including
such person's written consent to being named in the proxy statement as a
nominee and to serving as a director if elected), and (b) information that will
enable the Nominating Committee to determine whether the candidate satisfies
the Minimum Criteria and any Additional Criteria (as defined below) established
by the Nominating Committee.
In the event that a director is to be nominated at a special meeting of
shareholders or is to be elected by the Board, the Nominating Committee shall
develop procedures designed to conform, as nearly as practicable, to the
procedures applicable to elections of Board members at annual meetings.
The Nominating Committee may, but shall not be required to, develop other
procedures (the "Additional Procedures") designed to supplement the Minimum
Procedures.
PROCESSES TO BE FOLLOWED IN CONSIDERING CANDIDATES
--------------------------------------------------
Candidates to serve on the Board shall be identified from such sources as
shall be available to the Nominating Committee, including without limitation
recommendations made by shareholders.
There shall be no differences in the manner in which the Nominating
Committee evaluates nominees recommended by shareholders and nominees
recommended by the committee or management, except that no specific process
shall be mandated with respect to the nomination of any individuals who have
previously served on the Board. The evaluation process shall include (i) a
review of the information provided to the Nominating Committee by the
proponent, (ii) a review of reference letters from at least two sources
determined to be reputable by the Nominating Committee and (iii) a personal
interview of the candidate, together with a review of such other information as
the Nominating Committee shall determine to be relevant.
DUTIES OF THE NOMINATING COMMITTEE
----------------------------------
The Nominating Committee shall:
o determine whether other criteria (the "Additional Criteria"), beyond
the Minimum Criteria, should apply in nominating members of the Board,
such Additional Criteria to
o reflect, at a minimum, all applicable laws, rules, regulations and
listing standards applicable to the Company, and
o take into account a potential candidate's experience, areas of
expertise and other factors relative to the overall composition of the
board of directors;
o determine whether the Minimum Procedures should be supplemented with
Additional Procedures relating to the information to be submitted to
the Nominating Committee regarding prospective candidates;
o annually review the size, composition and needs of the Board and make
recommendations to the Board;
o recommend to the Board the director nominees for election at the next
annual meeting of shareholders;
A-2
o consider and recommend candidates for appointment to the Board to the
extent vacancies arise between annual meetings of shareholders;
o consider director candidates submitted by shareholders and other
third-parties, in accordance with the Minimum Procedures and any
Additional Procedures adopted by the Nominating Committee; and
o annually review the Nominating Committee charter and recommend to the
Board any changes it deems necessary or desirable.
MEETINGS OF THE NOMINATING COMMITTEE
------------------------------------
The Nominating Committee shall meet as often as necessary to carry out its
responsibilities, but not less than once each year. At the discretion of the
chairperson of the Nominating Committee, but at least once each year for all or
a portion of a meeting, the members of the Nominating Committee shall meet in
executive session, without any members of management present.
ADDITIONAL AUTHORITY OF THE NOMINATING COMMITTEE
------------------------------------------------
The Nominating Committee shall have the authority, in its discretion, to
retain outside counsel and other advisors.
A-3
APPENDIX B
AUDIT COMMITTEE CHARTER
The Audit Committee is appointed by the Board of Directors of Bel Fuse
Inc. ("Bel" or the "Company") to assist the Board in fulfilling its oversight
responsibilities. The Audit Committee's primary duties and responsibilities are
to:
o Assume direct responsibility for the appointment, compensation and
oversight of the work of the Company's independent auditors, including
resolution of any disagreements that may arise between the Company's
management and the Company's independent auditors regarding financial
reporting.
o Monitor the integrity of the Company's financial reporting process and
systems of internal controls regarding finance, accounting, and legal
compliance.
o Monitor the independence and performance of the Company's independent
auditors.
o Provide an avenue of communication among the independent auditors,
management and the Board of Directors.
o Encourage adherence to, and continued improvement of, the Company's
accounting policies, procedures, and practices at all levels; review
of potential significant financial risk to the Company; and monitor
compliance with legal and regulatory requirements.
o Monitor the performance of the company's internal audit function.
The Audit Committee has the authority to conduct any investigation
appropriate to fulfilling its responsibilities, and it has direct access to the
independent auditors as well as anyone in the organization. The Audit Committee
has the authority to retain, at the Company's expense, independent legal,
accounting, or other consultants or experts it deems necessary in the
performance of its duties.
Pursuant to this Charter:
1. THE COMMITTEE
Audit Committee members shall meet the applicable independence
requirements of the National Association of Securities Dealers (the "NASD"),
the Securities and Exchange Commission (the "SEC") and the Sarbanes-Oxley Act
of 2002 (the "Act"). The Audit Committee shall be comprised of three or more
directors as determined by the Board, each of whom shall be independent (as
defined by applicable rules of the NASD and the SEC) directors, free from any
relationship that would interfere with the exercise of his or her independent
judgment, and no Audit Committee member may, other than in the capacity of an
Audit Committee or board member, accept any consulting, advisory, or other
compensatory fee from the Company or its subsidiaries or be an affiliated
person of the Company or its subsidiaries. All members of the Audit Committee
shall have a basic understanding of finance and accounting and be able to read
and understand fundamental financial statements. It is the intention of the
Board to assure that at least one member of the Audit Committee shall satisfy
the requirements of a "financial expert" (as defined under the Act and pursuant
to regulations of the SEC).
Audit Committee members shall be appointed by the Board. If an Audit
Committee Chair is not designated or present, the members of the Audit
Committee may designate a Chair by majority vote of the Audit Committee
membership.
The Audit Committee shall meet at least four times annually, or more
frequently as circumstances dictate. The Audit Committee Chair shall prepare
and/or approve an agenda in advance of each meeting. The Audit Committee shall
meet privately in executive session at least annually with management and the
independent auditors, and as a committee to discuss any matters that the Audit
Committee or each of these groups believe should be discussed. In addition, the
Audit Committee shall meet quarterly with the independent auditors and
management to discuss the annual audited financial statements or quarterly
financial statements as applicable.
B-1
2. SCOPE
The Committee serves at the pleasure of the Board of Directors.
3. FUNCTIONS OF THE COMMITTEE
The Committee will satisfy its responsibilities by completing the
following functions:
Review Procedures
-----------------
(a) Review and reassess the adequacy of this Charter at least annually.
Submit this Charter to the Board of Directors for approval and have the
document published at least every three years in accordance with SEC
regulations.
(b) Require the independent auditors to advise the Audit Committee in
advance in the event that the independent auditors intend to provide any
professional services to the Company other than services provided in connection
with an audit or a review of the Company's financial statements ("non-audit
services").
(c) Review and pre-approve all audit and non-audit services provided by
the Company's auditors and obtain confirmations from time to time from the
Company's outside auditing firm that such firm is not providing to the Company
(i) any of the non-auditing services listed in Section 10A(g) of the Securities
Exchange Act of 1934, or (ii) any other non-audit service or any auditing
service that has not been approved in advance by the Audit Committee.
(d) Approve the provision of non-audit services that have not been
pre-approved by the Audit Committee, but only to the extent that such non-audit
services qualify under the de minimus exception set forth in Section 10A(i) (1)
(B) of the Securities Exchange Act of 1934. Record in its minutes and report to
the Board all approvals of audit services and non-audit services granted by the
Audit Committee.
(e) Review the Company's annual audited financial statements prior to
filing or distribution. Review should include discussion with management and
independent auditors of significant issues regarding accounting principles,
practices and judgments.
(f) In consultation with the management and the independent auditors,
consider the integrity of the Company's financial reporting processes and
controls. Discuss significant financial risk exposures and the steps management
has taken to monitor, control, and report such exposures. Review significant
findings prepared by the independent auditors together with management's
responses.
(g) Review Bel's quarterly financial results prior to the release of
earnings and/or the Company's quarterly financial statements prior to filing or
distribution. Discuss any significant changes to the Company's accounting
principles and any items to be communicated by the independent auditors in
accordance with SAS 61.
(h) Review the independence and performance of the independent auditors
and annually appoint the independent auditors or approve any discharge of
auditors when circumstances warrant, it being understood that the independent
auditors are ultimately accountable to the Audit Committee. The Audit Committee
shall require the independent auditors to submit, on an annual basis, a formal
written statement setting forth all relationships between the independent
auditors and the Company that may affect the objectivity and independence of
the independent auditors. Such statement shall confirm that the independent
auditors are not aware of any conflict of interest prohibited by Section 10A(i)
of the Securities Exchange Act of 1934. The Audit Committee shall actively
engage in a dialogue with the independent auditors with respect to any
disclosed relationships or services that may impact the objectivity and
independence of the independent auditors.
(i) Establish procedures for the receipt, retention and treatment of
complaints received by the Company regarding accounting, internal accounting
controls and auditing matters and for the confidential anonymous submission by
the Company's employees of concerns regarding questionable accounting or
auditing matters.
B-2
(j) On an annual basis, review and discuss with the independent auditors
all significant relationships they have with the Company that could impair the
auditors' independence.
(k) Prior to releasing the year-end earnings, discuss the results of the
audit with the independent auditors. Discuss certain matters required to be
communicated to audit committees in accordance with AICPA SAS 61.
(l) Consider the independent auditors' judgments about the quality and
appropriateness of the Company's accounting principles as applied in its
financial reporting and ensure the auditing firm reports to the Audit Committee
under the requirements set forth in Section 204 of the Act.
(m) Review the budget, plan, changes in plan, activities, organizational
structure and qualifications of the internal audit department, as needed.
(n) Commencing on such date as Section 102(a) of the Act becomes
effective, obtain confirmation from the independent auditors at the
commencement of each audit that such firm is a "registered public accounting
firm" as such term is defined under the Act.
(o) Require the independent auditors to report to the Audit Committee all
critical accounting policies and practices to be used, all alternative
treatments of financial information within generally accepted accounting
principles that have been discussed with the Company's management,
ramifications of the use of such alternative disclosures and treatments, the
treatments preferred by the independent auditors and other material written
communications between the independent auditors and the Company's management,
including management's letters and schedules of unadjusted differences.
(p) Set clear policies, compliant with governing laws and regulations, for
the hiring of employees or former employees of the independent auditor.
(q) Review with management the effect of regulatory and accounting
initiatives, as well as off-balance sheet structures, on the financial
statements of the Company.
(r) Review and approve all related party transactions.
(s) Within the time periods required by the Act and the regulations
promulgated thereunder, establish, review and update periodically a Code of
Ethics (the "Code") that complies with all applicable laws and regulations and
that applies to the Company's principal executive officer, principal financial
officer, principal accounting officer or controller, and persons performing
similar functions.
(t) Review the Company's major financial and accounting risk exposures and
the steps that management has undertaken to control them.
(u) Review, with the Company's counsel, any legal matter that could have a
significant impact on the organization's financial statements.
(v) Investigate or consider such other matters within the scope of its
responsibilities and duties as the Audit Committee may, in its discretion,
determine to be advisable.
OTHER AUDIT COMMITTEE RESPONSIBILITIES
--------------------------------------
(a) Annually, prepare a report to shareholders as required by the
Securities and Exchange Commission, such report to be included in the Company's
annual proxy statement.
(b) Annually, perform a self-assessment relative to the Audit Committee's
purpose, duties and responsibilities outlined herein.
(c) Perform any other activities consistent with this Charter, the
Company's by-laws, the Company's certificate of incorporation and governing
law, as the Committee or the Board deems necessary or appropriate.
(d) Maintain minutes of meetings and periodically report to the Board of
Directors on significant results of the foregoing activities.
B-3
While the Audit Committee has the responsibilities and powers set forth in
this Charter, it is not the duty of the Audit Committee to plan or conduct
audits or to determine that the Company's financial statements are complete and
accurate or are in accordance with generally accepted accounting principles.
This is the responsibility of management and the independent auditor.
Approved by the Bel Fuse Inc. Board of Directors
April 28, 2003
B-4
- FOLD AND DETACH HERE AND READ THE REVERSE SIDE -
--------------------------------------------------------------------------------
BEL FUSE INC.
THIS PROXY IS SOLICITED ON BEHALF OF THE BOARD OF
DIRECTORS FOR THE ANNUAL MEETING OF SHAREHOLDERS,
MAY 27, 2004
The undersigned hereby appoints Daniel Bernstein, Robert H. Simandl and
Colin Dunn, and each of them, attorneys and proxies, with power of substitution
in each of them, to vote for and on behalf of the undersigned at the annual
meeting of the shareholders of the Company to be held on May 27, 2004, and at
any adjournment thereof, upon matters properly coming before the meeting, as
set forth in the related Notice of Meeting and Proxy Statement, both of which
have been received by the undersigned. Without otherwise limiting the general
authorization given hereby, said attorneys and proxies are instructed to vote
as follows:
1. Election of the Board's nominees for Director. (The Board of Directors
recommends a vote "FOR".)
[ ] FOR the nominees listed below (except as marked to the contrary
below)
[ ] WITHHOLD AUTHORITY to vote for the nominees listed below
Nominees: Daniel Bernstein
Peter Gilbert
John S. Johnson
Avi Eden
INSTRUCTION: To withhold authority to vote for any individual nominee
listed above, write the nominee's name in the space provided
below.
2. Upon all such other matters as may properly come before the meeting
and/or any adjournment or adjournments thereof, as they in their
discretion may determine. The Board of Directors is not aware of any
such other matters.
- FOLD AND DETACH HERE AND READ THE REVERSE SIDE -
--------------------------------------------------------------------------------
UNLESS OTHERWISE SPECIFIED IN THE SQUARES OR SPACE PROVIDED IN THIS PROXY, THIS
PROXY WILL BE VOTED FOR THE BOARD'S NOMINEES.
Date ----------------------- , 2004
Signed ------------------------------------
-------------------------------------------
Please sign this proxy and return it
promptly whether or not you expect to
attend the meeting. You may nevertheless
vote in person if you attend.
Please sign exactly as your name appears
hereon. Give full title if an Attorney,
Executor, Administrator, Trustee, Guardian,
etc.
For an account in the name of two or more
persons, each should sign, or if one signs,
he should attach evidence of his authority.