3. ACQUISITION

On January 29, 2010 (the “Acquisition Date”), the Company completed its acquisition of 100% of the issued and outstanding capital stock of Cinch from Safran S.A. Bel paid $39.7 million in cash and assumed an additional $0.8 million of expenses in exchange for the net assets acquired. The transaction was funded with cash on hand. Cinch is headquartered in Lombard, Illinois and has manufacturing facilities in Vinita, Oklahoma; Reynosa, Mexico; and Worksop, England. The Company has made an election under IRC Section 338(h)10 to step-up the tax basis of the Cinch assets (held by the Cinch U.S., Cinch Mexico and Cinch U.K. entities) acquired to fair value. The elections made under Section 338(h)10 only affect U.S. income taxes (not those of the foreign countries where non-U.S. Cinch entities are incorporated).

Cinch manufactures a broad range of interconnect products for customers in the military and aerospace, high-performance computing, telecom/datacom, and transportation markets. The addition of Cinch's well-established lines of connector and cable products and extensive clientele has enabled Bel to broaden its customer base to include aerospace and military markets. The acquisition of Cinch has also created the opportunity for expense reduction and the elimination of redundancies. The combination of these factors has given rise to $2.3 million of goodwill ($1.2 million allocated to the Company's North America operating segment and $1.1 million allocated to the Company's Europe operating segment).

During the three and six months ended June 30, 2010, the Company expensed $0 and $0.2 million, respectively, of acquisition-related costs. These costs are included in selling, general and administrative expenses in the accompanying condensed consolidated statements of operations.

Cinch's results of operations have been included in the Company's condensed consolidated financial statements for the period subsequent to the Acquisition Date. Cinch contributed revenues of $24.7 million and estimated net earnings of $0.1 million to the Company for the period from the Acquisition Date through June 30, 2010. The unaudited pro forma information presents the combined operating results of the Company and Cinch. The following unaudited pro forma consolidated results of operations assume that the acquisition of Cinch was completed as of January 1, 2010 (in thousands):

	Six Months Ended
	June 30, 2010

Revenue	$	137,470
Net earnings		4,549
Earnings per Class A common share - basic and diluted		0.36
Earnings per Class B common share - basic and diluted		0.40