1 EXHIBIT 2.1 AMENDMENT TO AGREEMENT AND PLAN OF MERGER FIRST AMENDMENT (this "Amendment"), dated as of December 28, 2000, to the Agreement and Plan of Merger, dated as of November 10, 2000, among Sheldahl, Inc., a Minnesota corporation ("Parent"), IFT West Acquisition Company, a Delaware corporation and wholly owned subsidiary of Parent ("Merger Sub"), International Flex Holdings, Inc., a Delaware corporation (the "Company") and all of the stockholders of the Company (the "Stockholders"). PRELIMINARY STATEMENT Parent, Merger Sub, the Company and the Stockholders entered into an agreement and plan of merger, dated as of November 10, 2000 (the "Merger Agreement"). Subsequent to the execution and delivery of the Merger Agreement, certain developments occurred as a result of which the parties thereto determined that certain adjustments would be appropriate in the Merger Agreement. In addition, certain parties thereto desire to update the Parent Disclosure Letter and the Company Disclosure Letter attached thereto. Accordingly, the parties hereto agree as follows: 1. The table at the end of section 1.7(a) shall be deleted in its entirety and replaced with the following: - -------------------------------------------------------------------------------- EACH SHARE OF THE FOLLOWING CLASS: WILL BE CONVERTED INTO THE FOLLOWING NUMBER OF SHARES OF PARENT STOCK: - -------------------------------------------------------------------------------- Common Stock 1.16996136 - -------------------------------------------------------------------------------- Class A Stock 1.19696195 - -------------------------------------------------------------------------------- Class B Stock 1.31442475 - -------------------------------------------------------------------------------- Preferred Stock 1.21149700 - -------------------------------------------------------------------------------- 2. The table at the end of section 1.7(d) shall be deleted in its entirety and replaced with the following: 2 - -------------------------------------------------------------------------------- CLASS OF SHARES: NUMBER OF SHARES NUMBER OF SHARES OF OUTSTANDING PRIOR TO PARENT STOCK ISSUABLE IN EFFECTIVE TIME: RESPECT OF THE INDICATED CLASS OF SHARES: - -------------------------------------------------------------------------------- Common Stock none none - -------------------------------------------------------------------------------- Class A Stock none none - -------------------------------------------------------------------------------- Class B Stock 2,038,462 2,679,405 - -------------------------------------------------------------------------------- Preferred Stock 5,000,000 6,057,485 - -------------------------------------------------------------------------------- 3. Section 1.10(c) shall be amended by adding the following clause after the "(ii)" and before the word "cause" in the last sentence of such section: "provided that the Parent stock continues to be listed on the Nasdaq National Market,". 4. The table at the end of section 1.10(f) shall be deleted in its entirety and replaced with the following: - -------------------------------------------------------------------------------- CLASS OF OPTION NUMBER OF SHARES NUMBER OF SHARES OF OR WARRANT: UNDERLYING THE PARENT STOCK UNDERLING THE OPTION OR WARRANT: CONVERTED OPTION OR WARRANT: - -------------------------------------------------------------------------------- Company Stock Options 302,140 shares of 353,492 Common Stock - -------------------------------------------------------------------------------- Nardin Option 100,000 shares of 116,996 Common Stock - -------------------------------------------------------------------------------- IFT Warrant 404,858 shares of 484,600 Class A Stock - -------------------------------------------------------------------------------- 5. Section 5.11 shall be amended by adding the following clause after the word "Time" in the preliminary sentence of such section: -2- 3 "and provided that the Parent stock continues to be listed on the Nasdaq National Market". 6. Section 6.2(e)(i) shall be amended by adding the following clause after the word "therein": ", as such agreement is amended, restated or modified from time to time". 7. Section 6.2(e)(ii) shall be amended by adding the following clause after the word "herewith": ", as such agreement is amended, restated or modified from time to time". 8. Section 6.2(g) shall be deleted in its entirety and replaced with the following: "On or prior to the Effective Time, Parent shall execute and deliver to the Stockholders a governance agreement among Parent and certain stockholders (the "Governance Agreement") in the form of Exhibit 6.2(g) hereto. 9. The Parent Disclosure Letter attached hereto as exhibit A shall supercede the Parent Disclosure Letter referred to in the preamble to Article IV of the Merger Agreement for all purposes; provided, however, that the Parent Disclosure Letter delivered upon execution of the Merger Agreement on November 10, 2000 shall continue to apply with respect to the representations and warranties of Parent and Merger Sub made in the Merger Agreement as of that date. 10. The Company Disclosure Letter attached hereto as exhibit B shall supercede the Company Disclosure Letter referred to in the preamble to Article II of the Merger Agreement for all purposes; provided, however, that the Company Disclosure Letter delivered upon execution of the Merger Agreement on November 10, 2000 shall continue to apply with respect to the representations and warranties of the Company made in the Merger Agreement as of that date. 11. The Governance Agreement attached hereto as exhibit 6.2(g) shall supercede the Governance Agreement attached to the Merger Agreement as exhibit 6.2(g) for all purposes. -3- 4 12. The legal opinion of Lindquist & Vennum, P.L.L.P. attached hereto as exhibit 6.2(m) shall supercede the legal opinion of Lindquist & Vennum, P.L.L.P. attached to the Merger Agreement as exhibit 6.2(m) for all purposes. 13. From and after the date hereof, all references to the Merger Agreement in the Merger Agreement and any ancillary documents in connection therewith shall mean the Merger Agreement as amended hereby. 14. Except as otherwise expressly set forth in this Amendment, nothing herein shall be deemed to constitute an amendment, modification or waiver of any of the terms and conditions of the Merger Agreement or the exhibits thereto, all of which terms and conditions shall remain in full force and effect as originally constituted and the undersigned shall remain obligated pursuant to the terms thereunder. 15. This Amendment shall be governed by and construed and enforced in accordance with the internal laws of the State of Minnesota without regard to the principles of conflicts of law thereof. 16. This Amendment may be executed in two or more counterparts, all of which when taken together shall be considered one and the same agreement. In the event that any signature is delivered by facsimile transmission, such signature shall create a valid and binding obligation of the party executing (or on whose behalf such signature is executed) the same with the same force and effect as if such facsimile signature page were an original thereof. -4- 5 IN WITNESS WHEREOF, each of the parties has caused this First Amendment to be executed on its behalf by its respective officer thereunto duly authorized, all as of the day and year first above written. SHELDAHL, INC. By: /s/ Edward L. Lundstrom ----------------------------------------- Name: Edward L. Lundstrom Title: Chief Executive Officer IFT WEST ACQUISITION COMPANY By: /s/ Edward L. Lundstrom ----------------------------------------- Name: Edward L. Lundstrom Title: Chief Executive Officer INTERNATIONAL FLEX HOLDINGS, INC. By: /s/ John D. Lutsi ----------------------------------------- Name: John D. Lutsi Title: President IFH STOCKHOLDERS: MORGENTHALER VENTURE PARTNERS V, L.P. By: /s/ John D. Lutsi ----------------------------------------- Name: John D. Lutsi Title: General Partner SOUND BEACH TECHNOLOGY PARTNERS, LLC By: /s/ Donald R. Friedman ----------------------------------------- Name: Donald R. Friedman Title: President and Chief Executive Officer -5-