Exhibit 99.2
Kaman Corporation
Bloomfield, CT 06002
(860) 243-7100 NEWS
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KAMAN
KAMAN CORPORATION ANNOUNCES DEVELOPMENT CONCERNING PROPOSED RECAPITALIZATION
BLOOMFIELD, CONNECTICUT, (June 29, 2005) - In connection with the
recapitalization agreement between Kaman Corporation (NASDAQ: KAMNA) and
members of the Kaman family that was previously announced on June 7, 2005, the
company reported today that yesterday afternoon it received a letter from
Kaman family representatives indicating that the family intends to terminate
the recapitalization agreement in order to complete what they represent is a
"qualifying alternative transaction" contemplating a purchase of all of the
approximately 668,000 outstanding shares of the Company's Class B common stock
for $55.00 per share in cash.
The Company's Board of Directors has the right to terminate a "qualifying
alternative transaction" by approving a "substitute recapitalization proposal"
in accordance with the recapitalization agreement. The Board of Directors will
have ten business days (or if an arbitration were to be commenced until five
business days following completion of the arbitration) to determine whether to
approve and propose such a "substitute recapitalization proposal" to
shareholders. In that regard, the Company will have five business days within
which to determine whether to commence an arbitration. Pursuant to the
recapitalization agreement, the Kaman family has agreed to support any
"substitute recapitalization proposal" in the event one is approved by the
Board of Directors.
If approved by the Board and proposed to shareholders, a "substitute
recapitalization proposal" would amend the existing recapitalization proposal
to increase the number of voting common shares into which each share of Class
B common stock would be converted and would need to provide for a minimum
deemed value per Class B common share of at least $0.65 greater than the
$55.00 per share amount offered in the qualifying alternative transaction. For
this purpose, one share of the voting stock would be valued at $15.54, which
was the average closing price for the Class A common stock over the ten
trading day period prior to the recapitalization agreement being signed.
Accordingly, a substitute recapitalization proposal would need to have an
exchange ratio of at least 3.58 voting common shares for each share of Class B
common stock and a part stock/part cash alternative under which holders would
have the right to elect instead to receive for each of their shares of Class B
common stock at least 1.84 voting common shares and $27.10 in cash.
Additional details of the recapitalization agreement can be
found by reviewing the recapitalization agreement, which was filed as Exhibit
99.1 to the Company's current report on Form 8-K filed on June 7, 2005.
Additional details of the alternative transaction proposed by the Kaman family
can be found by reviewing the letter from the Kaman family's representatives
and its attachments, which is being filed as Exhibit 99.1 to the Company's
current report on Form 8-K filed on June 29, 2005.
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Kaman Corporation
June 29, 2005
Based in Bloomfield, Conn., Kaman Corporation conducts business in the
aerospace, industrial distribution and music markets. Kaman operates its
aerospace business through its Aerostructures, Fuzing, and Helicopters
divisions and its Kamatics subsidiary providing subcontract aerostructure
manufacturing for military and commercial aircraft, missile and bomb fuzing
products, SH-2G and K-MAX helicopters, and proprietary aircraft bearings and
products. Principal aerospace facilities are located in Connecticut, Florida
and Kansas. Kaman is the third largest North American distributor of power
transmission, motion control, material handling and electrical components and
a wide range of bearings offered to a customer base of more than 50,000
customers representing a highly diversified cross-section of North American
industry, with principal facilities in Alabama, California, Connecticut, New
York, Indiana, Kentucky and Utah. Kaman is also the largest independent
distributor of musical instruments and accessories, offering more than 17,500
products for amateurs and professionals, with principal facilities in Arizona,
Connecticut, California, New Jersey and Tennessee.
* * *
Forward-Looking Statements
This release may contain forward-looking information relating to the
corporation's business and prospects, including aerostructures and helicopter
subcontract programs and components, advanced technology products, the SH-2G
and K-MAX helicopter programs, the industrial distribution and music
businesses, operating cash flow, the benefits of the recapitalization
transaction, and other matters that involve a number of uncertainties that may
cause actual results to differ materially from expectations. Those
uncertainties include, but are not limited to: 1) the successful conclusion of
competitions for government programs and thereafter contract negotiations with
government authorities, both foreign and domestic; 2) political conditions in
countries where the corporation does or intends to do business; 3) standard
government contract provisions permitting renegotiation of terms and
termination for the convenience of the government; 4) economic and competitive
conditions in markets served by the corporation, particularly defense,
commercial aviation, industrial production and consumer market for music
products, as well as global economic conditions; 5) satisfactory completion of
the Australian SH-2G(A)program, including successful completion and
integration of the full ITAS software; 6) receipt and successful execution of
production orders for the JPF U.S. government contract including the exercise
of all contract options and receipt of orders from allied militaries, as both
have been assumed in connection with goodwill impairment evaluations; 7)
satisfactory resolution of the EODC/University of Arizona litigation; 8)
achievement of enhanced business base in the Aerospace segment in order to
better absorb overhead and general and administrative expenses, including
successful execution of the contract with Sikorsky for the BLACK HAWK
Helicopter program; 9) satisfactory results of negotiations with NAVAIR
concerning the corporation's leased facility in Bloomfield, Conn.; 10)
profitable integration of acquired businesses into the
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Kaman Corporation
June 29, 2005
corporation's operations; 11) changes in supplier sales or vendor incentive
policies; 12) the effect of price increases or decreases; 13) pension plan
assumptions and future contributions; 14) continued availability of raw
materials in adequate supplies; 15) satisfactory resolution of the supplier
switch and incorrect part issues at Dayron and the DCIS investigation; 16)
cost growth in connection with potential environmental remediation activities
related to the Bloomfield and Moosup facilities; 17) successful replacement of
the Corporation's revolving credit facility upon its expiration in November
2005; 18) risks associated with the course of litigation; 19) changes in laws
and regulations, taxes, interest rates, inflation rates, general business
conditions and other factors; 20) the effects of currency exchange rates and
foreign competition on future operations; and 21) other risks and
uncertainties set forth in Kaman's annual, quarterly and current reports, and
proxy statements. Any forward-looking information provided in this release
should be considered with these factors in mind. The corporation assumes no
obligation to update any forward-looking statements contained in this release.
Kaman intends to file with the Securities and Exchange Commission a
Registration Statement on Form S-4, which will contain a proxy
statement/prospectus in connection with the proposed recapitalization. The
proxy statement/prospectus will be mailed to the stockholders of Kaman when it
is finalized. STOCKHOLDERS OF KAMAN ARE ADVISED TO READ THE PROXY
STATEMENT/PROSPECTUS WHEN IT BECOMES AVAILABLE, BECAUSE IT WILL CONTAIN
IMPORTANT INFORMATION. Such proxy statement/prospectus (when available) and
other relevant documents may also be obtained, free of charge, on the
Securities and Exchange Commission's website (http://www.sec.gov) or by
request from the contact listed below.
Kaman and certain persons may be deemed to be participants in the solicitation
of proxies relating to the proposed recapitalization. The participants in such
solicitation may include Kaman's executive officers and directors. Further
information regarding persons who may be deemed participants will be available
in Kaman's proxy statement/prospectus to be filed with the Securities and
Exchange Commission in connection with the proposed recapitalization.
Contact: Russell H. Jones
SVP, Chief Investment Officer & Treasurer
(860) 243-6307
rhj-corp@kaman.com
www.kaman.com