Suit Is Brought Seeking to Compel Supermajority Vote on Kaman's Proposed Recapitalization
September 20 2005 - 7:52PM
PR Newswire (US)
BLOOMFIELD, Conn., Sept. 20 /PRNewswire-FirstCall/ -- In connection
with the previously announced proposed recapitalization
contemplated by the recapitalization agreement between Kaman
Corporation (NASDAQ:KAMNA) and members of the Kaman family, the
Company reported today that a lawsuit has been brought in federal
district court in Hartford, Connecticut by Mason Capital, Ltd.
against the Company and members of the Kaman family seeking, among
other relief, to enjoin the proposed recapitalization unless and
until the proposed recapitalization is approved by a
"supermajority" vote by the holders of two-thirds of the Company's
Class B common stock not owned by the parties to the
recapitalization agreement. Mason Capital has stated in the lawsuit
that it owns 4.76% of the outstanding Class B common stock. The
Company believes that, as structured, the proposed recapitalization
does not require the "supermajority" vote that Mason Capital claims
and the Company intends to vigorously pursue denial of all of the
relief requested by Mason Capital. The Company plans to hold the
special meetings of shareholders to approve the proposed
recapitalization as scheduled on October 11, 2005. As previously
reported, affiliates of Mason Capital are party to a share purchase
agreement with members of the Kaman family, pursuant to which, in
the event that the holders of the Class A common stock fail to
approve the proposed recapitalization or the proposed
recapitalization is otherwise not completed other than by reason of
a breach of the recapitalization agreement by the Kaman family, the
Kaman family can cause an affiliate of Mason Capital to purchase
the Kaman family's shares of Class B common stock at $55.00 per
share in cash and, upon the closing of the purchase from the Kaman
family, offer to purchase all remaining shares of Class B common
stock at $55.00 per share in cash. Further detail on the proposed
recapitalization and recapitalization agreement can be found in the
recapitalization agreement, which was filed as Exhibit 2.1 to a
Form 8-K filed by the Company on June 8, 2005 and proxy statement,
which was filed on September 2, 2005 and mailed to shareholders
shortly thereafter. 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 press release may contain forward-looking information relating
to the company's business and prospects, including the aerospace,
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 company
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 company, 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
company's leased facility in Bloomfield, Conn.; 10) profitable
integration of acquired businesses into the company '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) whether the proposed recapitalization is
completed; 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 the company 's annual, quarterly and current reports, and proxy
statements. Any forward-looking information provided in this press
release should be considered with these factors in mind. The
company assumes no obligation to update any forward-looking
statements contained in this press release. On August 18, 2005,
Kaman filed with the Securities and Exchange Commission a
Registration Statement on Form S-4, which has since been declared
effective by the Securities and Exchange Commission. The
Registration Statement on Form S-4 contains a proxy
statement/prospectus which describes the proposed recapitalization.
STOCKHOLDERS OF KAMAN ARE ADVISED TO READ THE PROXY
STATEMENT/PROSPECTUS, BECAUSE IT CONTAINS IMPORTANT INFORMATION.
Such proxy statement/prospectus and other relevant documents may be
obtained, free of charge, on the Securities and Exchange
Commission's website (http://www.sec.gov/) or from Kaman by
contacting Russell H. Jones, SVP, Chief Investment Officer &
Treasurer, by telephone at (860) 243-6307 or by email at . 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 is available in Kaman's proxy
statement/prospectus. DATASOURCE: Kaman Corporation CONTACT:
Russell H. Jones, SVP, Chief Investment Officer & Treasurer of
Kaman Corporation, +1-860-243-6307, Web site: http://www.kaman.com/
Company News On-Call: http://www.prnewswire.com/comp/480450.html
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