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Oaktree Affiliates to Acquire Pulse Electronics

Pulse Electronics Corporation announced that it has entered into a definitive agreement with certain affiliates of investment funds managed by Paul, Weiss client Oaktree Capital Management, L.P. Under the transaction, which will result in Pulse becoming a private company, Oaktree will invest a total of $17 million in Pulse and subsequently acquire 100 percent of the outstanding shares of Pulse.

Subject to terms of the merger agreement, Oaktree will provide within 30 days, $8.5 million of new loans to Pulse, which will be converted to common stock of Pulse at the closing of the transactions, and at the closing of the transactions, Oaktree will invest an additional amount of cash equal to $17 million less the principal amount of such loans, in exchange for common stock of Pulse. Upon closing of the transactions, expected in the second quarter of 2015, Oaktree will own over 80 percent of the outstanding shares of Pulse common stock and will cause a wholly owned subsidiary of Oaktree to be merged with and into Pulse in accordance with the applicable provisions of Pennsylvania's short-form merger statute, with Pulse surviving as a wholly owned subsidiary of Oaktree.

Oaktree made its original investment in Pulse in November 2012 in a recapitalization transaction pursuant to which Oaktree agreed to make investments in, and loans to, Pulse equal to approximately $102.7 million and become Pulse's principal lender and largest shareholder. The expected acquisition of 100 percent of Pulse by Oaktree will provide other shareholders with a source of liquidity and Pulse with financing required to address its liquidity needs, and will enable Pulse to deregister its common stock and suspend its reporting obligations under the Exchange Act, which is expected to generate significant cost savings for Pulse.

The Paul, Weiss team included, among others, corporate partners Kenneth Schneider and Eric Goodison and counsel Dorian Fogel; tax partner Patrick Karsnitz; and employee benefits partner Robert Fleder and counsel Reuven Falik.

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