As filed with the Securities and Exchange Commission on September 24, 1997.
Registration No. 333-
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
____________________________
FORM S-8
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
____________________________
SHELDAHL, INC.
(Exact name of registrant as specified in its charter)
Minnesota 41-0758073
(State or other jurisdiction of (I.R.S. Employer
incorporation or organization) Identification No.)
1150 Sheldahl Road
Northfield, Minnesota 55057
(Address of Principal Executive Offices and zip code)
____________________________
SHELDAHL, INC.
1994 STOCK PLAN
(Full title of the Plan)
____________________________
Copy to:
James E. Donaghy Charles P. Moorse
President Kristin L. Johnson
1150 Sheldahl Road Lindquist & Vennum P.L.L.P.
Northfield, Minnesota 55057 4200 IDS Center
(507) 663-8000 Minneapolis, MN 55402
(Name, address and telephone (612) 371-3211
number, including area code,
of agent for service)
CALCULATION OF REGISTRATION FEE
Proposed Proposed
Title of Maximum Maximum
Securities Amount Offering Aggregate Amount of
to be to be Price Offering Registration
Registered Registered Per Share(1) Price(1) Fee
Common Stock, 400,000 shares(2) $20.125 $8,050,000 $2,440.00
$.25 par value,
to be issued pursuant
to Sheldahl, Inc.
1994 Stock Plan
(1) Estimated solely for the purpose of determining the registration fee
pursuant to Rule 457(c) and (h) and based upon the average of the high
and low prices of the Company's Common Stock on the Nasdaq National
Market on September 19, 1997.
(2) 600,000 shares were registered on Form S-8 (File No. 33-58549) on April
12, 1995 and 400,000 shares are being registered herewith.
<PAGE>
INCORPORATION OF CONTENTS OF REGISTRATION STATEMENT
BY REFERENCE
A Registration Statement on Form S-8 (File No. 33-58549) was filed with
the Securities and Exchange Commission on April 12, 1995 covering the
registraton of 600,000 shares initially authorized for issuance under the
Company's 1994 Stock Plan (the "Plan"). A filing fee of $3,077.58 was paid
at the time that Registration Statement was filed. Pursuant to General
Instruction E of Form S-8 and Rule 429, this Registration Statement is being
filed to register an additional 400,000 shares authorized under the Plan. An
amendment to the Plan to increase the reserved and authorized number of shares
under the Plan by 400,000 was authorized by the Company's Board of Directors
on October 31, 1996 and such amendment was approved by the Company's
shareholders on January 8, 1997. This Registration Statement should also be
considered a post-effective amendment to the prior Registration Statement.
The contents of the prior Registration Statement are incorporated herein by
reference.
PART I
Pursuant to Part I of Form S-8, the information required by Items 1 and
2 of Form S-8 is not filed as a part of this Registration Statement.
PART II
Item 3. Incorporation of Documents by Reference.
_________________________________________________
The following documents filed with the Securities and Exchange
Commission are hereby incorporated by reference herein:
(a) The Annual Report of the Company on Form 10-K for the fiscal year
ended August 30, 1996.
(b) The Definitive Proxy Statement dated November 27, 1996 for the
1997 Annual Meeting of Shareholders held January 8, 1997.
(c) The Quarterly Reports of the Company on Form 10-Q for the quarters
ended November 29, 1996, February 28, 1997 and May 30, 1997.
(d) The description of the Company's Common Stock as set forth in the
Company's Form S-2 Registration Statement dated June 22, 1994
(Registration No. 33-79266), including any amendment or report
filed for the purpose of updating such description.
All documents subsequently filed by the Company pursuant to Sections
13(a), 13(c), 14 and 15(d) of the Securities Exchange Act of 1934, prior to
the filing of a post-effective amendment which indicates that all securities
offered have been sold or which deregisters all securities then remaining
unsold, shall be deemed to be incorporated by reference in this Registration
Statement and to be a part hereof from the date of filing of such documents.
Item 4. Description of Securities.
___________________________________
Not applicable.
Item 5. Interests of Named Experts and Counsel.
________________________________________________
Gerald E. Magnuson, Secretary of the Company, is Of Counsel with
Lindquist & Vennum P.L.L.P., which is the law firm passing on the validity of
the securities issued under the Plan.
Item 6. Indemnification of Directors and Officers.
___________________________________________________
Section 302A.521 of the Minnesota Business Corporation Act provides that
a corporation shall indemnify a person made or threatened to be made a party
to a proceeding by reason of the former or present official capacity of the
person against judgments, penalties, fines, including, without limitation,
excise taxes assessed against the person with respect to an employee benefit
plan, settlements, and reasonable expenses, including attorneys' fees and
disbursements, incurred by the person in connection with the proceeding, if,
with respect to the acts or omissions of the person complained of in the
proceeding, the person:
(1) Has not been indemnified by another organization or employee
benefit plan for the same judgments, penalties, fines, including,
without limitation, excise taxes assessed against the person with
respect to an employee benefit plan, settlements, and reasonable
expenses, including attorneys' fees and disbursements, incurred by
the person in connection with the proceeding with respect to the
same acts or omissions;
(2) Acted in good faith;
(3) Received no improper personal benefit and section 302A.255
(Director Conflicts of Interest), if applicable, has been
satisfied;
(4) In the case of a criminal proceeding, had no reasonable cause to
believe the conduct was unlawful; and
(5) In the case of acts or omissions occurring in the official
capacity described in subdivision 1, paragraph (c), clause (1) or
(2), reasonably believed that the conduct was in the best
interests of the corporation, or in the case of acts or omissions
occurring in the official capacity described in subdivision 1,
paragraph (c), clause (3), reasonably believed that the conduct
was not opposed to the best interests of the corporation. If the
person's acts or omissions complained of in the proceeding relate
to conduct as a director, officer, trustee, employee, or agent of
an employee benefit plan, the conduct is not considered to be
opposed to the best interests of the corporation if the person
reasonably believed that the conduct was in the best interests of
the participants or beneficiaries of the employee benefit plan.
Item 7. Exemption from Registration Claimed.
_____________________________________________
Not applicable.
Item 8. Exhibits.
__________________
4.1 Sheldahl, Inc. 1994 Stock Plan, as amended
5.1 Opinion and Consent of Lindquist & Vennum P.L.L.P.
23.1 Consent of Lindquist & Vennum P.L.L.P. (included in Exhibit 5.1)
23.2 Consent of Arthur Andersen LLP, independent public accountants
24.1 Power of Attorney (set forth on the signature page hereof)
Item 9. Undertakings.
______________________
(a) The undersigned registrant hereby undertakes:
(1) To file, during any period in which offers or sales are being
made, a post-effective amendment to this registration statement:
(i) To include any prospectus required by Section 10(a)(3) of the
Securities Act of 1933;
(ii) To reflect in the prospectus any facts or events arising
after the effective date of the registration statement (or the most
recent post-effective amendment thereof) which, individually or in the
aggregate, represents a fundamental change in the information set forth
in the registration statement;
(iii) To include any material information with respect to the
plan of distribution not previously disclosed in the registration
statement or any material change to such information in the registration
statement;
Provided, however, that paragraphs (a)(1)(i) and (a)(1)(ii) do not apply
if the registration statement is on Form S-3 or Form S-8 and the information
required to be included in a post-effective amendment by those paragraphs is
contained in periodic reports filed by the registrant pursuant to section 13
or section 15(d) of the Securities Exchange Act of 1934 that are incorporated
by reference in the registration statement.
(2) That, for the purpose of determining any liability under the
Securities Act of 1933, each such post-effective amendment shall be deemed to
be a new registration statement relating to the securities offered therein,
and the offering of such securities at that time shall be deemed to be the
initial bona fide offering thereof.
(3) To remove from registration by means of a post-effective amendment
any of the securities being registered which remain unsold at the termination
of the offering.
(b) The undersigned registrant hereby undertakes that, for purposes of
determining any liability under the Securities Act of 1933, each filing of the
registrant's annual report pursuant to Section 13(a) or Section 15(d) of the
Securities Exchange Act of 1934 that is incorporated by reference in the
registration statement shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of such
securities at that time shall be deemed to be the initial bona fide offering
thereof.
(h) Insofar as indemnification for liabilities arising under the Securities
Act of 1933 may be permitted to directors, officers, and controlling persons
of the registrant pursuant to the foregoing provisions, or otherwise, the
registrant has been advised that in the opinion of the Securities and Exchange
Commission such indemnification is against public policy as expressed in the
Act and is, therefore, unenforceable. In the event that a claim for
indemnification against such liabilities (other than the payment by the
registrant of expenses incurred or paid by a director, officer, or controlling
person of the registrant in the successful defense of any action, suit, or
proceeding) is asserted by such director, officer, or controlling person
connected with the securities being registered, the registrant will, unless in
the opinion of its counsel the matter has been settled by controlling
precedent, submit to a court of appropriate jurisdiction the question whether
such indemnification by it is against public policy as expressed in the Act
and will be governed by the final adjudication of such issue.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Act of 1933, the
registrant certifies that it has reasonable grounds to believe that it meets
all of the requirements for filing on Form S-8 and has duly caused this
registration statement to be signed on its behalf by the undersigned,
thereunto duly authorized, in the City of Northfield, State of Minnesota, on
September 19, 1997.
SHELDAHL, INC.
By /s/ James E. Donaghy
James E. Donaghy, President
POWER OF ATTORNEY
The undersigned officers and directors of Sheldahl, Inc. hereby
constitute and appoint James E. Donaghy and Gerald E. Magnuson, or either of
them, with power to act one without the other, our true and lawful attorney-
in-fact and agent, with full power of substitution and resubstitution, for us
and in our stead, in any and all capacities to sign any and all amendments
(including post-effective amendments) to this Registration Statement and all
documents relating thereto, and to file the same, with all exhibits thereto,
and other documents in connection therewith, with the Securities and Exchange
Commission, granting unto said attorney-in-fact and agent, full power and
authority to do and perform each and every act and thing necessary or
advisable to be done in and about the premises, as fully to all intents and
purposes as he might or could do in person, hereby ratifying and confirming
all that said attorney-in-fact and agent, or his substitutes, may lawfully do
or cause to be done by virtue hereof.
Pursuant to the requirements of the Securities Act of 1933, as amended,
this registration statement has been signed below by the following persons on
September 19, 1997 in the capacities indicated.
Signatures
__________
/s/ James E. Donaghy
James E. Donaghy, President,
Chief Executive Officer (Principal
Executive Officer) and Director
/s/ John V. McManus
John V. McManus, Vice
President and Chief Financial
Officer (Principal Financial
Officer)
/s/ James S. Womack
James S. Womack, Chairman of
the Board
/s/ Richard S. Wilcox
Richard S. Wilcox, Director
/s/ Kenneth J. Roering
Kenneth J. Roering, Director
/s/ William B. Miller
William B. Miller, Director
/s/ Gerald E. Magnuson
Gerald E. Magnuson, Director
/s/ John G. Kassakian
John G. Kassakian, Director
/s/ Beekman Winthrop
Beekman Winthrop, Director
<PAGE>
Exhibit 4.1
SHELDAHL, INC.
1994 STOCK PLAN
SECTION 1. General Purpose of Plan; Definitions.
_____________________________________
The name of this plan is the Sheldahl, Inc. 1994 Stock Plan (the
"Plan"). The purpose of the Plan is to enable Sheldahl, Inc. (the "Company")
and its Subsidiaries to retain and attract executives and other key employees,
consultants and non-employee directors who contribute to the Company's success
by their ability, ingenuity and industry, and to enable such individuals to
participate in the long-term success and growth of the Company by giving them
a proprietary interest in the Company.
For purposes of the Plan, the following terms shall be defined as set
forth below:
a. "Board" means the Board of Directors of the Company.
b. "Cause" means a felony conviction of a participant or the
failure of a participant to contest prosecution for a felony,
or a participant's willful misconduct or dishonesty, any of
which is directly and materially harmful to the business or
reputation of the Company.
c. "Code" means the Internal Revenue Code of 1986, as amended.
d. "Committee" means a Committee with the membership referred to
in Section 2 of the Plan or the Board.
e. "Company" means Sheldahl, Inc., a corporation organized under
the laws of the State of Minnesota (or any successor
corporation).
f. "Deferred Stock" means an award made pursuant to Section 8
below of the right to receive Stock at the end of a specified
deferral period.
g. "Disability" means permanent and total disability as determined
by the Committee.
h. "Disinterested Person" means a "non-employee director" as
defined in Rule 16b-3(b)(3)(i) as promulgated by the Securities
and Exchange Commission under the Securities Act of 1934, or
any successor definitions adopted by the Commission.
i. "Early Retirement" means retirement, with consent of the
Committee at the time of retirement, from active employment
with the Company and any Subsidiary or Parent Corporation of
the Company.
j. "Fair Market Value" means the value of the Stock on a given
date as determined by the Committee in accordance with Section
422(c)(7) of the Code and any applicable Treasury Department
regulations promulgated thereunder.
k. "Incentive Stock Option" means any Stock Option intended to be
and designated as an "Incentive Stock Option" within the
meaning of Section 422 of the Code.
l. "Non-Employee Director" means any member of the Board who is
not an employee of the Company, any Parent Corporation or
Subsidiary.
m. "Non-Qualified Stock Option" means any Stock Option that is not
an Incentive Stock Option, and is intended to be and is
designated as a "Non-Qualified Stock Option."
n. "Normal Retirement" means retirement from active employment
with the Company and any Subsidiary or Parent Corporation of
the Company on or after age 65.
o. "Parent Corporation" means any corporation (other than the
Company) in an unbroken chain of corporations ending with the
Company if, at the time of the granting of a Stock Option, each
of the corporations (other than the Company) owns stock
possessing 50% or more of the total combined voting power of
all classes of stock in one of the other corporations in the
chain as provided in Section 424(e) of the Code.
p. "Restricted Stock" means an award of shares of Stock that are
subject to restrictions under Section 7 below.
q. "Retirement" means Normal Retirement or Early Retirement.
r. "Stock" means the Common Stock, $.25 par value per share, of
the Company.
s. "Stock Appreciation Right" means the right pursuant to an award
granted under Section 6 below to surrender to the Company all
or a portion of a Stock Option in exchange for an amount equal
to the difference between (i) the Fair Market Value, as of the
date such Stock Option or such portion thereof is surrendered,
of the shares of Stock covered by such Stock Option or such
portion thereof, and (ii) the aggregate exercise price of such
Stock Option or such portion thereof.
t. "Stock Option" means any option to purchase shares of Stock
granted pursuant to Section 5 below.
u. "Subsidiary" means any corporation (other than the Company) in
an unbroken chain of corporations beginning with the Company
if, at the time of the granting of a Stock Option, each of the
corporations (other than the last corporation in the unbroken
chain) owns stock possessing 50% or more of the total combined
voting power of all classes of stock in one of the other
corporations in the chain as provided in Section 424(f) of the
Code.
SECTION 2. Administration.
_______________
The Plan shall be administered by the Board of Directors or by a
Committee of not less than three Disinterested Persons, who shall be appointed
by the Board of Directors of the Company and who shall serve at the pleasure
of the Board.
The Committee shall have the power and authority to grant to eligible
persons, pursuant to the terms of the Plan: (i) Stock Options, (ii) Stock
Appreciation Rights, (iii) Restricted Stock, or (iv) Deferred Stock awards.
In particular, the Committee shall have the authority:
(i) to select the officers and other key
employees of the Company and its Subsidiaries, and
consultants and other persons having a contractual
relationship with the Company or its Subsidiaries, to
whom Stock Options, Stock Appreciation Rights, Restricted
Stock and/or Deferred Stock awards may from time to time
be granted hereunder;
(ii) to determine whether and to what extent
Incentive Stock Options, Non-Qualified Stock Options,
Stock Appreciation Rights, Restricted Stock or Deferred
Stock awards, or a combination of the foregoing, are to
be granted hereunder;
(iii) to determine the number of shares to be
covered by each such award granted hereunder;
(iv) to determine the terms and conditions, not
inconsistent with the terms of the Plan, of any award
granted hereunder (including, but not limited to, any
restriction on any Stock Option or other award and/or the
shares of Stock relating thereto), and to amend such
terms and conditions (including, but not limited to, any
amendment which accelerates the vesting of any award);
and
(v) to determine whether, to what extent and
under what circumstances Stock and other amounts payable
with respect to an award under this Plan shall be
deferred either automatically or at the election of the
participant.
The Committee shall have the authority to adopt, alter and repeal
such administrative rules, guidelines and practices governing the Plan as it
shall, from time to time, deem advisable; to interpret the terms and
provisions of the Plan and any award issued under the Plan (and any agreements
relating thereto); and to otherwise supervise the administration of the Plan.
The Committee may delegate its authority to officers of the Company for the
purpose of selecting employees who are not officers of the Company for
purposes of (i) above.
All decisions made by the Committee pursuant to the provisions of the
Plan shall be final and binding on all persons, including the Company and Plan
participants.
SECTION 3. Stock Subject to Plan.
______________________
The total number of shares of Stock reserved and available for
distribution under the Plan shall be 1,000,000. Such shares shall consist, in
whole or in part, of authorized and unissued shares.
Subject to paragraph (b)(iv) of Section 6 below, if any shares that
have been optioned ceased to be subject to Options, or if any shares subject
to any Restricted Stock or Deferred Stock award granted hereunder are
forfeited or such award otherwise terminates without a payment being made to
the participant, such shares shall again be available for distribution in
connection with future awards under the Plan.
In the event of any merger, reorganization, consolidation,
recapitalization, stock dividend, other change in corporate structure
affecting the Stock, or spin-off or other distribution of assets to
shareholders, such substitution or adjustment shall be made in the aggregate
number of shares reserved for issuance under the Plan, in the number and
option price of shares subject to outstanding options granted under the Plan,
and in the number of shares subject to Restricted Stock or Deferred Stock
awards granted under the Plan as may be determined to be appropriate by the
Committee, in its sole discretion, provided that the number of shares subject
to any award shall always be a whole number. Such adjusted option price shall
also be used to determine the amount payable by the Company upon the exercise
of any Stock Appreciation Right associated with any Option.
SECTION 4. Eligibility.
____________
Officers, other key employees of the Company or its Subsidiaries,
Non-Employee Directors and consultants and other persons having a contractual
relationship with the Company or its Subsidiaries who are responsible for or
contribute to the management, growth and/or profitability of the business of
the Company and its Subsidiaries are eligible to be granted Stock Options,
Stock Appreciation Rights, Restricted Stock or Deferred Stock awards under the
Plan. The optionees and participants under the Plan shall be selected from
time to time by the Committee, in its sole discretion, from among those
eligible, and the Committee shall determine, in its sole discretion, the
number of shares covered by each award. Notwithstanding the foregoing, no
person shall receive grants of stock options and stock appreciation rights
which exceed 100,000 shares during any fiscal year of the Company.
SECTION 5. Stock Options.
______________
Any Stock Option granted under the Plan shall be in such form as the
Committee may from time to time approve.
The Stock Options granted under the Plan may be of two types: (i)
Incentive Stock Options and (ii) Non-Qualified Stock Options. No Incentive
Stock Options shall be granted under the Plan after October 14, 2004.
The Committee shall have the authority to grant any optionee
Incentive Stock Options, Non-Qualified Stock Options, or both types of options
(in each case with or without Stock Appreciation Rights). To the extent that
any option does not qualify as an Incentive Stock Option, it shall constitute
a separate Non-Qualified Stock Option.
Anything in the Plan to the contrary notwithstanding, no term of this
Plan relating to Incentive Stock Options shall be interpreted, amended or
altered, nor shall any discretion or authority granted under the Plan be so
exercised, so as to disqualify either the Plan or any Incentive Stock Option
under Section 422 of the Code. The preceding sentence shall not preclude any
modification or amendment to an outstanding Incentive Stock Option, whether or
not such modification or amendment results in disqualification of such Option
as an Incentive Stock Option, provided the optionee consents in writing to the
modification or amendment.
Options granted under the Plan shall be subject to the following
terms and conditions and shall contain such additional terms and conditions,
not inconsistent with the terms of the Plan, as the Committee shall deem
desirable.
(a) Option Price. The option price per share of Stock purchasable
under a Stock Option shall be determined by the Committee at the time of
grant. In no event shall the option price per share of Stock purchasable
under an Incentive Stock Option be less than 100% of the Fair Market Value of
the Stock on the date of the grant of the option. If an employee owns or is
deemed to own (by reason of the attribution rules applicable under Section
424(d) of the Code) more than 10% of the combined voting power of all classes
of stock of the Company or any Parent Corporation or Subsidiary and an
Incentive Stock Option is granted to such employee, the option price shall be
no less than 110% of the Fair Market Value of the Stock on the date the option
is granted.
(b) Option Term. The term of each Stock Option shall be fixed by
the Committee, but no Incentive Stock Option shall be exercisable more than
ten years after the date the option is granted. If an employee owns or is
deemed to own (by reason of the attribution rules of Section 424(d) of the
Code) more than 10% of the combined voting power of all classes of stock of
the Company or any Parent Corporation or Subsidiary and an Incentive Stock
Option is granted to such employee, the term of such option shall be no more
than five years from the date of grant.
(c) Exercisability. Stock Options shall be exercisable at such
time or times as determined by the Committee at or after grant. If the
Committee provides, in its discretion, that any option is exercisable only in
installments, the Committee may waive such installment exercise provisions at
any time. Notwithstanding the foregoing, unless the Stock Option Agreement
provides otherwise, any Stock Option granted under this Plan shall be
exercisable in full, without regard to any installment exercise provisions,
for a period specified by the Company, but not to exceed sixty (60) days,
prior to the occurrence of any of the following events: (i) dissolution or
liquidation of the Company other than in conjunction with a bankruptcy of the
Company or any similar occurrence, (ii) any merger, consolidation,
acquisition, separation, reorganization, or similar occurrence, where the
Company will not be the surviving entity or (iii) the transfer of
substantially all of the assets of the Company or 75% or more of the
outstanding Stock of the Company.
(d) Method of Exercise. Stock Options may be exercised in whole or
in part at any time during the option period by giving written notice of
exercise to the Company specifying the number of shares to be purchased. Such
notice shall be accompanied by payment in full of the purchase price, either
by certified or bank check, or by any other form of legal consideration deemed
sufficient by the Committee and consistent with the Plan's purpose and
applicable law, including promissory notes or a properly executed exercise
notice together with irrevocable instructions to a broker acceptable to the
Company to promptly deliver to the Company the amount of sale or loan proceeds
to pay the exercise price. As determined by the Committee, in its sole
discretion, payment in full or in part may also be made in the form of
unrestricted Stock already owned by the optionee or, in the case of the
exercise of a Non-Qualified Stock Option, Restricted Stock or Deferred Stock
subject to an award hereunder (based, in each case, on the Fair Market Value
of the Stock on the date the option is exercised, as determined by the
Committee), provided, however, that in the event payment is made in the form
of shares of Restricted Stock or a Deferred Stock award, the optionee will
receive a portion of the option shares in the form of, and in an amount equal
to, the Restricted Stock or Deferred Stock award tendered as payment by the
optionee. An optionee may elect to pay all or part of the option exercise
price by having the Company withhold from the shares of Stock that would
otherwise be issued upon exercise that number of shares of Stock having a Fair
Market Value equal to the aggregate option exercise price for the shares with
respect to which such election is made. No shares of Stock shall be issued
until full payment therefor has been made. An optionee shall generally have
the rights to dividends and other rights of a shareholder with respect to
shares subject to the option when the optionee has given written notice of
exercise, has paid in full for such shares, and, if requested, has given the
representation described in paragraph (a) of Section 12.
(e) Non-transferability of Options. No Stock Option shall be
transferable by the optionee otherwise than by will or by the laws of descent
and distribution, and all Stock Options shall be exercisable, during the
optionee's lifetime, only by the optionee.
(f) Termination by Death. If an optionee's employment by the
Company and any Subsidiary or Parent Corporation terminates by reason of
death, the Stock Option may thereafter be immediately exercised, to the extent
then exercisable (or on such accelerated basis as the Committee shall
determine at or after grant), by the legal representative of the estate or by
the legatee of the optionee under the will of the optionee, for a period of
one year (or such shorter period as the Committee shall specify at grant) from
the date of such death or until the expiration of the stated term of the
option, whichever period is shorter.
(g) Termination by Reason of Disability. If an optionee's
employment by the Company and any Subsidiary or Parent Corporation terminates
by reason of Disability, any Stock Option held by such optionee may thereafter
be exercised, to the extent it was exercisable at the time of termination due
to Disability (or on such accelerated basis as the Committee shall determine
at or after grant), but may not be exercised after one year (or such shorter
period as the Committee shall specify at grant) from the date of such
termination of employment or the expiration of the stated term of the option,
whichever period is the shorter. In the event of termination of employment by
reason of Disability, if an Incentive Stock Option is exercised after the
expiration of the exercise periods that apply for purposes of Section 422 of
the Code, the option will thereafter be treated as a Non-Qualified Stock
Option.
(h) Termination by Reason of Retirement. If an optionee's
employment by the Company and any Subsidiary or Parent Corporation terminates
by reason of Retirement, any Stock Option held by such optionee may thereafter
be exercised to the extent it was exercisable at the time of such Retirement,
but may not be exercised after three months (or such longer period as the
Committee shall specify at Retirement)from the date of such termination of
employment or the expiration of the stated term of the option, whichever
period is the shorter. In the event of termination of employment by reason of
Retirement, if an Incentive Stock Option is exercised after the expiration of
the exercise periods that apply for purposes of Section 422 of the Code, the
option will thereafter be treated as a Non-Qualified Stock Option.
(i) Other Termination. Unless otherwise determined by the
Committee, if an optionee's employment by the Company and any Subsidiary or
Parent Corporation terminates for any reason other than death, Disability or
Retirement, the Stock Option shall thereupon terminate, except that the option
may be exercised to the extent it was exercisable at such termination for the
lesser of three months (or such shorter period as the Committee shall specify
at grant) or the balance of the option's term, provided, however, that if the
optionee's employment is terminated for Cause, all rights under the Stock
Option shall terminate and expire upon such termination.
(j) Annual Limit on Incentive Stock Options. The aggregate Fair
Market Value (determined as of the time the Option is granted) of the Common
Stock with respect to which an Incentive Stock Option under this Plan or any
other plan of the Company and any Subsidiary or Parent Corporation is
exercisable for the first time by an optionee during any calendar year shall
not exceed $100,000.
(k) Non-Employee Directors. Each Non-Employee Director who on or
after the date this Plan is approved by the shareholders of the Company (A) is
elected or re-elected as a director of the Company at any annual meeting of
the shareholders of the Company, or (B) is elected as a director of the
Company at any special meeting of the shareholders of the Company, shall as of
the date of such election or re-election automatically be granted a Stock
Option to purchase 2,000 shares of Stock at the option price per share equal
to 100% of the Fair Market Value of a share of Stock on such date. In the
case of a special meeting, the action of the shareholders in electing a Non-
Employee Director shall constitute the granting of the Stock Option to such
director, and, in the case of an annual meeting, the action of the
shareholders in electing or re-electing a Non-Employee Director shall
constitute the granting of a Stock Option to such director; and the date when
the shareholders take such action shall be the date of grant of the Stock
Option. All such Stock Options shall be designated as Non-Qualified Stock
Options and shall be subject to the same terms and provisions as are then in
effect with respect to the granting of Non-Qualified Stock Options to officers
and key employees of the Company, except that (i) the term of each such Stock
Option shall be equal to ten (10) years, unless such Non-Employee Director
ceases to be a member of the Board, in which case the Stock Option shall
expire 30 days after such Non-Employee Director's departure from the Board and
(ii) no Stock Appreciation Rights may be granted to any Non-Employee Director
under this paragraph (k) or in any other manner under this Plan. Subject to
the foregoing, all provisions of this Plan not inconsistent with the foregoing
shall apply to Stock Options granted to Non-Employee Directors.
SECTION 6. Stock Appreciation Rights.
__________________________
(a) Grant and Exercise. Except as set forth in paragraph (k) of
Section 5, Stock Appreciation Rights may be granted in conjunction with all or
part of any Stock Option granted under the Plan. In the case of a Non-
Qualified Stock Option, such rights may be granted either at or after the time
of the grant of such Option. In the case of an Incentive Stock Option, such
rights may be granted only at the time of the grant of the option.
A Stock Appreciation Right or applicable portion thereof granted with
respect to a given Stock Option shall terminate and no longer be exercisable
upon the termination or exercise of the related Stock Option, except that a
Stock Appreciation Right granted with respect to less than the full number of
shares covered by a related stock Option shall not be reduced until the
exercise or termination of the related Stock Option exceeds the number of
shares not covered by the Stock Appreciation Right.
A Stock Appreciation Right may be exercised by an optionee, in
accordance with paragraph (b) of this Section 6, by surrendering the
applicable portion of the related Stock Option. Upon such exercise and
surrender, the optionee shall be entitled to receive an amount determined in
the manner prescribed in paragraph (b) of this Section 6. Stock Options which
have been so surrendered, in whole or in part, shall no longer be exercisable
to the extent the related Stock Appreciation Rights have been exercised.
(b) Terms and Conditions. Stock Appreciation Rights shall be
subject to such terms and conditions, not inconsistent with the provisions of
the Plan, as shall be determined from time to time by the Committee, including
the following:
(i) Stock Appreciation Rights shall be exercisable only at
such time or times and to the extent that the Stock Options to which
they relate shall be exercisable in accordance with the provisions of
Section 5 and this Section 6 of the Plan.
(ii) Upon the exercise of a Stock Appreciation Right, an
optionee shall be entitled to receive up to, but not more than, an
amount in cash or shares of Stock equal in value to the excess of the
Fair Market Value of one share of Stock over the option price per
share specified in the related option multiplied by the number of
shares in respect of which the Stock Appreciation Right shall have
been exercised, with the Committee having the right to determine the
form of payment.
(iii) Stock Appreciation Rights shall be transferable only
when and to the extent that the underlying Stock Option would be
transferable under Section 5 of the Plan.
(iv) Upon the exercise of a Stock Appreciation Right, the
Stock Option or part thereof to which such Stock Appreciation Right
is related shall be deemed to have been exercised for the purpose of
the limitation set forth in Section 3 of the Plan on the number of
shares of Stock to be issued under the Plan, but only to the extent
of the number of shares issued or issuable under the Stock
Appreciation Right at the time of exercise based on the value of the
Stock Appreciation Right at such time.
(v) A Stock Appreciation Right granted in connection with an
Incentive Stock Option may be exercised only if and when the market
price of the Stock subject to the Incentive Stock Option exceeds the
exercise price of such Option.
SECTION 7. Restricted Stock.
_________________
(a) Administration. Shares of Restricted Stock may be issued
either alone or in addition to other awards granted under the Plan. The
Committee shall determine the officers and key employees of the Company and
Subsidiaries to whom, and the time or times at which, grants of Restricted
Stock will be made, the number of shares to be awarded, the time or times
within which such awards may be subject to forfeiture, and all other
conditions of the awards. The Committee may also condition the grant of
Restricted Stock upon the attainment of specified performance goals. The
provisions of Restricted Stock awards need not be the same with respect to
each recipient.
(b) Awards and Certificates. The prospective recipient of an award
of shares of Restricted Stock shall not have any rights with respect to such
award, unless and until such recipient has executed an agreement evidencing
the award and has delivered a fully executed copy thereof to the Company, and
has otherwise complied with the then applicable terms and conditions.
(i) Each participant shall be issued a stock certificate in
respect of shares of Restricted Stock awarded under the Plan. Such
certificate shall be registered in the name of the participant, and
shall bear an appropriate legend referring to the terms, conditions,
and restrictions applicable to such award, substantially in the
following form:
"The transferability of this certificate and the
shares of stock represented hereby are subject to
the terms and conditions (including forfeiture)
of the Sheldahl, Inc. 1994 Stock Plan and an
Agreement entered into between the registered
owner and Sheldahl, Inc. Copies of such Plan and
Agreement are on file in the offices of Sheldahl,
Inc., 1150 Sheldahl Road, Northfield, MN 55057."
(ii) The Committee shall require that the stock certificates
evidencing such shares be held in custody by the Company until the
restrictions thereon shall have lapsed, and that, as a condition of
any Restricted Stock award, the participant shall have delivered a
stock power, endorsed in blank, relating to the Stock covered by such
award.
(c) Restrictions and Conditions. The shares of Restricted Stock
awarded pursuant to the Plan shall be subject to the following restrictions
and conditions:
(i) Subject to the provisions of this Plan and the award
agreement, during a period set by the Committee commencing with the
date of such award (the "Restriction Period"), the participant shall
not be permitted to sell, transfer, pledge or assign shares of
Restricted Stock awarded under the Plan. In no event shall the
Restriction Period be less than one (1) year. Within these limits,
the Committee may provide for the lapse of such restrictions in
installments where deemed appropriate.
(ii) Except as provided in paragraph (c)(i) of this Section 7,
the participant shall have, with respect to the shares of Restricted
Stock, all of the rights of a shareholder of the Company, including
the right to vote the shares and the right to receive any cash
dividends. The Committee, in its sole discretion, may permit or
require the payment of cash dividends to be deferred and, if the
Committee so determines, reinvested in additional shares of
Restricted Stock (to the extent shares are available under Section
3). Certificates for shares of unrestricted Stock shall be delivered
to the grantee promptly after, and only after, the period of
forfeiture shall have expired without forfeiture in respect of such
shares of Restricted Stock.
(iii) Subject to the provisions of the award agreement and
paragraph (c)(iv) of this Section 7, upon termination of employment
for any reason during the Restriction Period, all shares still
subject to restriction shall be forfeited by the participant.
(iv) In the event of special hardship circumstances of a
participant whose employment is terminated (other than for Cause),
including death, Disability or Retirement, or in the event of an
unforeseeable emergency of a participant still in service, the
Committee may, in its sole discretion, when it finds that a waiver
would be in the best interest of the Company, waive in whole or in
part any or all remaining restrictions with respect to such
participant's shares of Restricted Stock.
(v) Notwithstanding the foregoing, all restrictions with
respect to any participant's shares of Restricted Stock shall lapse,
on the date determined by the Committee, prior to, but in no event
more than sixty (60) days prior to, the occurrence of any of the
following events: (i) dissolution or liquidation of the Company,
other than in conjunction with a bankruptcy of the Company or any
similar occurrence, (ii) any merger, consolidation, acquisition,
separation, reorganization, or similar occurrence, where the Company
will not be the surviving entity or (iii) the transfer of
substantially all of the assets of the Company or 75% or more of the
outstanding Stock of the Company.
SECTION 8. Deferred Stock Awards.
______________________
(a) Administration. Deferred Stock may be awarded either alone or
in addition to other awards granted under the Plan. The Committee shall
determine the officers and key employees of the Company and Subsidiaries to
whom and the time or times at which Deferred Stock shall be awarded, the
number of Shares of Deferred Stock to be awarded to any participant or group
of participants, the duration of the period (the "Deferral Period") during
which, and the conditions under which, receipt of the Stock will be deferred,
and the terms and conditions of the award in addition to those contained in
paragraph (b) of this Section 8. The Committee may also condition the grant
of Deferred Stock upon the attainment of specified performance goals. The
provisions of Deferred Stock awards need not be the same with respect to each
recipient.
(b) Terms and Conditions.
(i) Subject to the provisions of this Plan and the award
agreement, Deferred Stock awards may not be sold, assigned,
transferred, pledged or otherwise encumbered during the Deferral
Period. In no event shall the Deferral Period be less than one (1)
year. At the expiration of the Deferral Period (or Elective Deferral
Period, where applicable), share certificates shall be delivered to
the participant, or his legal representative, in a number equal to
the shares covered by the Deferred Stock award.
(ii) Amounts equal to any dividends declared during the
Deferral Period with respect to the number of shares covered by a
Deferred Stock award will be paid to the participant currently or
deferred and deemed to be reinvested in additional Deferred Stock or
otherwise reinvested, all as determined at the time of the award by
the Committee, in its sole discretion.
(iii) Subject to the provisions of the award agreement and
paragraph (b)(iv) of this Section 8, upon termination of employment
for any reason during the Deferral Period for a given award, the
Deferred Stock in question shall be forfeited by the participant.
(iv) In the event of special hardship circumstances of a
participant whose employment is terminated (other than for Cause)
including death, Disability or Retirement, or in the event of an
unforeseeable emergency of a participant still in service, the
Committee may, in its sole discretion, when it finds that a waiver
would be in the best interest of the Company, waive in whole or in
part any or all of the remaining deferral limitations imposed
hereunder with respect to any or all of the participant's Deferred
Stock.
(v) A participant may elect to further defer receipt of the
award for a specified period or until a specified event (the
"Elective Deferral Period"), subject in each case to the Committee's
approval and to such terms as are determined by the Committee, all in
its sole discretion. Subject to any exceptions adopted by the
Committee, such election must generally be made prior to completion
of one half of the Deferral Period for a Deferred Stock award (or for
an installment of such an award).
(vi) Each award shall be confirmed by, and subject to the
terms of, a Deferred Stock agreement executed by the Company and the
participant.
SECTION 9. Transfer, Leave of Absence, etc.
________________________________
For purposes of the Plan, the following events shall not be deemed a
termination of employment:
(a) a transfer of an employee from the Company to a Parent
Corporation or Subsidiary, or from a Parent Corporation or Subsidiary to the
Company, or from one Subsidiary to another;
(b) a leave of absence, approved in writing by the Committee, for
military service or sickness, or for any other purpose approved by the Company
if the period of such leave does not exceed ninety (90) days (or such longer
period as the Committee may approve, in its sole discretion); and
(c) a leave of absence in excess of ninety (90) days, approved in
writing by the Committee, but only if the employee's right to reemployment is
guaranteed either by a statute or by contract, and provided that, in the case
of any leave of absence, the employee returns to work within 30 days after the
end of such leave.
SECTION 10. Amendments and Termination.
____________________________
The Board may amend, alter, or discontinue the Plan, but no
amendment, alteration, or discontinuation shall be made (i) which would impair
the rights of an optionee or participant under a Stock Option, Stock
Appreciation Right, Restricted Stock, Deferred Stock or other Stock-based
award theretofore granted, without the optionee's or participant's consent, or
(ii) which without the approval of the stockholders of the Company would cause
the Plan to no longer comply with Rule 16b-3 under the Securities Exchange Act
of 1934, Section 422 of the Code or any other regulatory requirements.
The Committee may amend the terms of any award or option theretofore
granted, prospectively or retroactively, but, subject to Section 3 above, no
such amendment shall impair the rights of any holder without his consent. The
Committee may also substitute new Stock Options for previously granted
options, including previously granted options having higher option prices.
SECTION 11. Unfunded Status of Plan.
________________________
The Plan is intended to constitute an "unfunded" plan for incentive
and deferred compensation. With respect to any payments not yet made to a
participant or optionee by the Company, nothing contained herein shall give
any such participant or optionee any rights that are greater than those of a
general creditor of the Company. In its sole discretion, the Committee may
authorize the creation of trusts or other arrangements to meet the obligations
created under the Plan to deliver Stock or payments in lieu of or with respect
to awards hereunder, provided, however, that the existence of such trusts or
other arrangements is consistent with the unfunded status of the Plan.
SECTION 12. General Provisions.
____________________
(a) The Committee may require each person purchasing shares
pursuant to a Stock Option under the Plan to represent to and agree with the
Company in writing that the optionee is acquiring the shares without a view to
distribution thereof. The certificates for such shares may include any legend
which the Committee deems appropriate to reflect any restrictions on transfer.
All certificates for shares of Stock delivered under the Plan
pursuant to any Restricted Stock, Deferred Stock or other Stock-based awards
shall be subject to such stock-transfer orders and other restrictions as the
Committee may deem advisable under the rules, regulations, and other
requirements of the Securities and Exchange Commission, any stock exchange
upon which the Stock is then listed, and any applicable Federal or state
securities laws, and the Committee may cause a legend or legends to be put on
any such certificates to make appropriate reference to such restrictions.
(b) Subject to paragraph (d) below, recipients of Restricted Stock,
Deferred Stock and other Stock-based awards under the Plan (other than Stock
Options) are not required to make any payment or provide consideration other
than the rendering of services.
(c) Nothing contained in this Plan shall prevent the Board of
Directors from adopting other or additional compensation arrangements, subject
to stockholder approval if such approval is required; and such arrangements
may be either generally applicable or applicable only in specific cases. The
adoption of the Plan shall not confer upon any employee of the Company or any
Subsidiary any right to continued employment with the Company or a Subsidiary,
as the case may be, nor shall it interfere in any way with the right of the
Company or a Subsidiary to terminate the employment of any of its employees at
any time.
(d) Each participant shall, no later than the date as of which any
part of the value of an award first becomes includible as compensation in the
gross income of the participant for Federal income tax purposes, pay to the
Company, or make arrangements satisfactory to the Committee regarding payment
of, any Federal, state, or local taxes of any kind required by law to be
withheld with respect to the award. The obligations of the Company under the
Plan shall be conditional on such payment or arrangements and the Company and
Subsidiaries shall, to the extent permitted by law, have the right to deduct
any such taxes from any payment of any kind otherwise due to the participant.
With respect to any award under the Plan, if the terms of such award so
permit, a participant may elect by written notice to the Company to satisfy
part or all of the withholding tax requirements associated with the award by
(i) authorizing the Company to retain from the number of shares of Stock that
would otherwise be deliverable to the participant, or (ii) delivering to the
Company from shares of Stock already owned by the participant, that number of
shares having an aggregate Fair Market Value equal to part or all of the tax
payable by the participant under this Section 12(d). Any such election shall
be in accordance with, and subject to, applicable tax and securities laws,
regulations and rulings.
SECTION 13. Effective Date of Plan.
________________________
The Plan shall be effective on October 14, 1994 (the date of approval
by the Board of Directors), subject to approval by a vote of the holders of a
majority of the Stock present and entitled to vote at the Annual Meeting of
the Company's Shareholders on January 11, 1995 to approve (i) the Plan and
(ii) an amendment to the Company's Articles of Incorporation to increase the
authorized shares. The Plan shall expire (unless terminated earlier) as of
October 14, 2004. Awards may be granted under the Plan prior to such
Shareholder approval, provided such awards are made subject to Shareholder
approval. Shareholder approval of the Plan was obtained on January 11, 1995.
The Plan was amended by the resolutions adopted by the Board of
Directors on August 18, 1996 and October 31, 1996. The Shareholders ratified
the amendments on January 8, 1997.
<PAGE>
Exhibit 5.1
September 19, 1997
Sheldahl, Inc.
1150 Sheldahl Road
Northfield, Minnesota 55057
Re: Opinion of Counsel as to Legality of 400,000 Shares of Common
Stock to be registered under the Securities Act of 1933
Ladies and Gentlemen:
This opinion is furnished in connection with the registration under
the Securities Act of 1933 on Form S-8 of 400,000 shares of Common Stock,
$0.25 par value, of Sheldahl, Inc. (the "Company") offered to officers, other
key employees and non-employee directors pursuant to the Sheldahl, Inc. 1994
Stock Plan (the "Plan").
We advise you that it is our opinion, based on our familiarity with
the affairs of the Company and upon our examination of pertinent documents,
that the 400,000 shares of Common Stock to be issued by the Company under the
Plan, will, when paid for and issued, be validly issued and lawfully
outstanding, fully paid and nonassessable shares of Common Stock of the
Company.
The undersigned hereby consent to the filing of this opinion with the
Securities and Exchange Commission as an Exhibit to the Registration Statement
with respect to said shares of Common Stock under the Securities Act of 1933.
Very truly yours,
LINDQUIST & VENNUM P.L.L.P.
/s/ Lindquist & Vennum P.L.L.P.
<PAGE>
EXHIBIT 23.2
CONSENT OF INDEPENDENT PUBLIC ACCOUNTANTS
As independent public accountants, we hereby consent to the incorporation of
our report and to all references to our firm included in or made a part of
this registration statement.
/s/ Arthur Andersen LLP
ARTHUR ANDERSEN LLP
Minneapolis, Minnesota
September 19, 1997
<PAGE>
