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): December 30, 1997
KAMAN CORPORATION
(Exact name of issuer as specified in its charter)
Connecticut 0-1093 06-0613548
(State of (Commission (I.R.S.
Incorporation) File Number) Employer
Identification
No.)
1332 Blue Hills Avenue
Bloomfield, CT 06002
(Address of principal executive offices)
Registrant's telephone number, including area code: (860) 243-7100
Not Applicable
(Former name or former address, if changes since last report)
Item 2. Acquisition or Disposition of Assets.
On December 30, 1997, Kaman Corporation, a Connecticut
corporation (the "Company"), consummated the previously announced
disposition (the "Sciences Disposition") of its wholly owned
subsidiary Kaman Sciences Corporation, a Delaware corporation
("Kaman Sciences" or "KSC"), pursuant to a stock purchase agreement
(the "Agreement") between the Company and ITT Industries, Inc., an
Indiana corporation ("ITTI"). The Company sold all of the
outstanding capital stock of Kaman Sciences to ITTI for $135
million in cash, in accordance with the Agreement.
The Agreement, and the Press Release of the Company dated
December 30, 1997, relating to the consummation of the Sciences
Disposition are being filed as exhibits to this Report. Each of
such documents is incorporated herein by reference. The foregoing
description is qualified in its entirety by reference to such
exhibits.
Item 7. Financial Statements and Exhibits
(a) Financial Statements of Business Acquired:
Not Applicable.
(b) Pro Forma Financial Information:
The following Unaudited Pro Forma Condensed Consolidated
Statements are filed with this report:
Unaudited Pro Forma Condensed Consolidated Balance Sheet
as of September 30, 1997.
Unaudited Pro Forma Condensed Consolidated Statements
of Operations for the Year Ended December 31, 1996
and Nine Months Ended September 30, 1997.
The following Unaudited Pro Forma Condensed Consolidated
Balance Sheet as of September 30, 1997 reflects the
estimated impact of the Sciences Disposition on the
Company's consolidated financial position assuming that the
transaction had been completed as of September 30, 1997.
The following Unaudited Pro Forma Condensed Consolidated
Statements of Operations for the Year Ended December 31,
1996 and for the Nine Months Ended September 30, 1997
reflect the estimated impact of the Sciences
Disposition on the Company's consolidated statement
of operations assuming that the transaction had been
completed at the beginning of each period presented.
The unaudited pro forma consolidated financial statements
presented in this report have been prepared by the
Company based upon assumptions deemed proper, are shown
for illustrative purposes only, and are not necessarily
indicative of the financial position or results of
operations of the Company that would have actually resulted
had the Sciences Disposition occurred as of the date or at
the beginning of the periods presented, or that may result
in the future. The nonrecurring transactions related
directly to the Sciences Disposition are excluded from the
Unaudited Pro Forma Condensed Statements of Operations.
The unaudited pro forma condensed consolidated financial
statements should be read in conjunction with the
historical financial statements and related notes of the
Company for the year ended December 31, 1996 as filed on
Form 10-K and for the nine months ended September 30, 1997,
as filed on Form 10-Q.
(c) Exhibits:
(2) Stock Purchase Agreement, dated as of November 14,
1997, by and between Kaman Corporation and ITT
Industries, Inc.
(99) Press Release of Kaman Corporation dated December 30,
1997.
Kaman Corporation and Subsidiaries
Unaudited Pro Forma Condensed Consolidated Balance Sheet
(In thousands)
September 30, 1997
-------------------
Pro Forma Adjustments (Note 2)
------------------------------
(As Disposition Other (Pro
Reported) Of KSC(a) Adjustments Forma)
--------- ----------- ----------- ------
Current assets:
Cash and cash equivalents $ 10,040 (115) 45,600(b) 55,525
Accounts receivable 229,736 (21,857) - 207,879
Inventories 197,224 (2,769) - 194,455
Other current assets 30,777 (3,225) - 27,552
-------- ------- ------- -------
Total current assets 467,777 (27,966) 45,600 485,411
Property, plant &
equipment(at cost): 190,502 (41,265) - 149,237
Less accumulated
depreciation 117,089 (23,649) - 93,440
-------- -------- ------- -------
Net property, plant
& equipment 73,413 (17,616) - 55,797
Other assets 10,760 (6,041) - 4,719
-------- -------- ------- -------
Total assets $551,950 (51,623) 45,600 545,927
======== ======== ======= =======
Kaman Corporation and Subsidiaries
Unaudited Pro Forma Condensed Consolidated Balance Sheet
(In thousands)
September 30, 1997
-------------------
Pro Forma Adjustments (Note 2)
------------------------------
(As Disposition Other (Pro
Reported) Of KSC(a) Adjustments Forma)
--------- ----------- ----------- ------
Current liabilities:
Notes payable $ 14,920 (505) (10,000)(b) 4,415
Accounts payable 60,630 (3,692) - 56,938
Accrued liabilities 40,267 (13,919) - 26,348
Customer advances 101,789 - - 101,789
Other current liabilities 27,228 (279) - 26,949
Income taxes payable - - - -
-------- -------- ------- ------
Total current
liabilities 244,834 (18,395) (10,000) 216,439
Deferred credits 16,147 (2,822) - 13,325
Long-term debt, excluding
current portion 59,690 (1,822) (28,000)(b) 29,868
-------- -------- -------- -------
Total liabilities 320,671 (23,039) (38,000) 259,632
Shareholders' equity:
Series 2 preferred stock 57,140 - - 57,140
Other shareholders'
equity 174,139 (28,584) 83,600(c) 229,155
-------- -------- ------- -------
Total shareholders'
equity 231,279 (28,584) 83,600 286,295
-------- --------- ------- --------
Total liabilities
& shareholders'
equity $551,950 (51,623) 45,600 545,927
======== ========= ======= ========
See accompanying notes to Unaudited Pro Forma Condensed Consolidated Balance
Sheet.
KAMAN CORPORATION AND SUBSIDIARIES
NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED BALANCE SHEET
(IN THOUSANDS)
NOTE 1 - BASIS OF PRESENTATION
The pro forma adjustments to the condensed consolidated balance
sheet reflect the Sciences Disposition, as if the transaction
had been completed as of September 30, 1997.
NOTE 2 - PRO FORMA ADJUSTMENTS
(a) Reflects the Sciences Disposition by eliminating KSC's balance
sheet data from the condensed consolidated balance sheet of
Kaman Corporation and subsidiaries at September 30, 1997.
(b) Reflects the receipt of net cash proceeds from the Sciences
Disposition assuming the payment of related income taxes, the
repayment of bank debt, and the payment of certain transaction
expenses.
(c) Reflects net increase in shareholders' equity associated with
the Sciences Disposition. The change in shareholders' equity
of $55.0 million represents a pre-tax gain of approximately
$95.0 million and estimated income tax expense of $40.0
million. The actual gain and tax consequences recorded in 1997
will be dependent on the final book and tax basis.
Kaman Corporation and Subsidiaries
Unaudited Pro Forma Condensed Consolidated Statement of Operations
(In thousands, except per share amounts)
Year Ended December 31, 1996
-------------------------------------------------
Pro Forma Adjustments (Note 2)
------------------------------
(As Disposition Other (Pro
Reported) Of KSC(a) Adjustments Forma)
--------- ----------- ----------- ------
Revenues:
Net sales $948,106 (125,098) - 823,008
Other 5,548 - - 5,548
-------- --------- ------ -------
953,654 (125,098) - 828,556
Costs and expenses:
Cost of sales 708,505 (108,518) - 599,987
Selling, general and
administrative expenses 193,747 (8,536) - 185,211
Interest expense 10,023 (1,221) (5,350)(b) 3,452
Other expense 702 (231) - 471
-------- --------- ------- -------
912,977 (118,506) (5,350) 789,121
-------- --------- -------- -------
Earnings before income
taxes 40,677 (6,592) 5,350 39,435
Income taxes 17,100 (2,709) 2,250(c) 16,641
-------- -------- ------- --------
Net earnings $ 23,577 (3,883) 3,100 22,794
======== ======== ======= ========
Preferred stock dividend
requirement $ (3,716) - - (3,716)
========= ======== ======= =========
Earnings applicable to
common stock $ 19,861 (3,883) 3,100 19,078
======== ======== ======= =======
Per share:
Net earnings per
common share:
Primary $ 1.06 $ 1.02
Fully diluted $ 1.00 $ .97
Average common shares
outstanding:
Primary 18,736 18,736
Fully diluted 24,732 24,732
See accompanying notes to Unaudited Pro Forma Condensed Consolidated
Statements of Operations.
Kaman Corporation and Subsidiaries
Unaudited Pro Forma Condensed Consolidated Statement of Operations
(In thousands, except per share amounts)
Nine Months Ended September 30, 1997
--------------------------------------
Pro Forma Adjustments (Note 2)
------------------------------
(As Disposition Other (Pro
Reported) Of KSC(a) Adjustments Forma)
--------- ----------- --------- ------
Revenues 772,376 (110,208) - 662,168
Costs and expenses:
Cost of sales 583,791 (95,228) - 488,563
Selling, general and
administrative expenses 154,938 (7,528) - 147,410
Loss on sale of amplifier
business 10,400 - - 10,400
Interest expense 6,516 (880) (4,000)(b) 1,636
Other expense/(income),net 69 (173) - (104)
-------- -------- ------- --------
755,714 (103,809) (4,000) 647,905
-------- -------- -------- -------
Earnings before income taxes 16,662 (6,399) 4,000 14,263
Income taxes 7,262 (2,577) 1,700(c) 6,385
-------- -------- ------- -------
Net earnings $ 9,400 (3,822) 2,300 7,878
======== ======== ======= =======
Preferred stock dividend
requirement $ (2,787) - - (2,787)
========= ======== ======= ========
Earnings applicable to
common stock $ 6,613 (3,822) 2,300 5,091
======== ======== ======= =======
Per share:
Net earnings per
common share:
Primary $ 0.35 $ .27
Fully diluted $ 0.35 $ .27
Average common shares
outstanding:
Primary 19,144 19,144
Fully diluted * *
*Fully diluted shares are not shown as the calculation is antidilutive.
See accompanying notes to Unaudited Pro Forma Condensed Consolidated
Statements of Operations.
KAMAN CORPORATION AND SUBSIDIARIES
NOTES TO UNAUDITED PRO FORMA CONDENSED CONSOLIDATED
STATEMENTS OF OPERATIONS
NOTE 1 - BASIS OF PRESENTATION
The pro forma adjustments to the condensed consolidated statements
of operations reflect the Sciences Disposition as if the
transaction had been completed at the beginning of the period
for the year ended December 31, 1996 and for the nine months ended
September 30, 1997, respectively.
NOTE 2 - PRO FORMA ADJUSTMENTS
(a) Reflects the Sciences Disposition by eliminating KSC's
statement of operations data from the condensed consolidated
statement of operations of Kaman Corporation and subsidiaries
for the year ended December 31, 1996 and for the nine months
ended September 30, 1997.
(b) Reflects the interest savings from the repayment of bank debt
as if it were repaid at the beginning of the period.
(c) Reflects the increase in income taxes relating to the
elimination of interest expense due to the repayment of bank
debt.
SIGNATURES
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.
KAMAN CORPORATION
By: Robert M. Garneau
Executive Vice President and
Chief Financial Officer
Dated: January 13, 1998
EXHIBIT INDEX
Exhibit Description
2 Stock Purchase Agreement, dated as of
November 14, 1997, by and between
Kaman Corporation and ITT Industries, Inc.
99 Press Release of the Company, dated
December 30, 1997.