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SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF
THE SECURITIES EXCHANGE ACT OF 1934
Date of Report (date of earliest event reported): June 25, 2000
Sheldahl, Inc.
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(Exact name of Registrant as specified in its charter)
Minnesota 0-45 41-0758073
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(State or other jurisdiction (Commission (I.R.S. Employer
of incorporation) File Number) Identification No.)
1150 Sheldahl Road
Northfield, Minnesota 55057
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(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (507) 663-8000
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Item 5. Other Events
On October 26, 1999, Sheldahl, Inc., a Minnesota corporation (the
"Company"), announced it had retained USBancorp Piper Jaffray, Inc. as its
financial advisor to pursue and recommend various strategic alternatives
intended to maximize shareholder value. On June 26, 2000, the Company announced
that it was engaged in discussions with International Flex Technologies Inc.
("IFT") regarding a potential acquisition of IFT by the Company and an
investment in the Company by Morgenthaler Partners, the majority owner of IFT
and other potential investors.
No assurances have been given that an agreement will be signed or a
transaction consummated. Nevertheless, the Company and IFT have discussed a
proposal under which Sheldahl will acquire IFT in exchange for shares of
Sheldahl's common stock. In addition, Morgenthaler Partners and other potential
investors have proposed to infuse approximately $40 million in new capital into
Sheldahl in exchange for shares of a new series of Sheldahl's convertible
preferred stock at a conversion price of $4.62 per share. As a result of the
acquisition and new investment, Morgenthaler Partners, the IFT shareholders and
the other investors would hold securities representing beneficial ownership of
approximately 43% of Sheldahl. In addition, the Company, Morgenthaler Partners
and IFT have entered into an agreement pursuant to which they will deal
exclusively with each other until August 7, 2000 (the "Exclusivity Agreement").
Under the terms of the Exclusivity Agreement, the Company, Morgenthaler
Partners and IFT agreed that until the earlier of (i) the execution of a
definitive acquisition agreement, and (ii) August 7, 2000, they and their
representatives will not directly or indirectly initiate, solicit, accept or
discuss proposals or offers for either the Company (or any of its divisions) or
IFT or offers to acquire securities from or make a loan to the Company or IFT.
In addition, the Company agreed to cease any current discussions regarding any
other acquisition or financing proposals.
Pursuant to the Exclusivity Agreement, in the event either party
breaches the exclusivity arrangement and completes a business combination
transaction with another party in the next 225 days due to such breach, then
that party shall pay the other party's reasonable expenses.
Any transactions would be conditioned upon customary due diligence
review by the parties, execution of definitive agreements, absence of material
adverse change and governmental and third party consents and approvals,
including approval by Sheldahl's shareholders.
Under the terms of the Agreement Relating to Sheldahl dated November
18, 1998, Molex Incorporated ("Molex") will have the right to purchase shares of
common stock and shares of the new series of preferred stock to be issued in the
transactions on the same terms as offered in the transaction and in an amount
which would allow Molex to maintain its percentage interest in the Company.
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Item 7. Financial Statements, Pro Forma Financial Information and Exhibits.
Exhibit 99.1 Exclusive Letter Agreement among the Company,
Morgenthaler Partners and International Flex
Technologies Inc. dated June 25, 2000
Exhibit 99.2 Press Release
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SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned, thereunto duly authorized.
Sheldahl, Inc.
By /s/ Edward L. Lundstrom
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Edward L. Lundstrom, President and
Chief Executive Officer
Dated: June 26, 2000
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