--------------------------------------------------------------------------------

Exhibit 10.1

 
LONG-TERM PERFORMANCE AWARD AGREEMENT
(Under the Kaman Corporation
2003 Stock Incentive Plan)

THIS AGREEMENT, made and entered into as of the ________ day of_____________,
20___, by and between KAMAN CORPORATION, a Connecticut corporation, with its
principal office in Bloomfield, Connecticut (the "Corporation"), and
________________________ ("Participant");

W I T N E S S E T H :

WHEREAS, it has been determined that the Participant is an Eligible Person under
the Corporation’s 2003 Stock Incentive Plan (the “Plan”) and

[WHEREAS, the Participant has been designated as a Covered Employee under the
Plan; and]

WHEREAS, the Committee wishes to grant to the Participant a Long-Term
Performance Award, as hereinafter described (the “Long-Term Performance Award”);
[and]

[WHEREAS, the Committee intends the Long-Term Performance Award to be a
Qualified Performance-Based Award meeting the criteria of the Section 162(m)
Exemption including Qualified Performance Criteria, as those terms are defined
in the Plan;]

NOW, THEREFORE, in consideration of the premises, and of the mutual covenants
and agreements contained in this Agreement, the parties confirm and agree as
follows:

1.  Long-Term Incentive Award.
 
(a)  Subject to the terms and conditions of this Agreement, the Participant is
awarded a Long-Term Performance Award which shall entitle the Participant to a
payment based upon the performance criteria, Performance Period, payment
computation formula and other factors set forth in Exhibit A to this Agreement
which is incorporated by reference. The Long-Term Performance Award is subject
to forfeiture as more particularly described in Section 2 of this Agreement.
 
-1-

--------------------------------------------------------------------------------

        (b)  In order for the Participant to be eligible to receive the payment
which the Participant may otherwise earn pursuant to the Long-Term Performance
Award, the Participant must execute and deliver a copy of this Agreement to the
President of the Corporation at its offices in Bloomfield, Connecticut within
sixty (60) days of the date on which the Participant has received this
Agreement. The Participant must execute both the signature page of this
Agreement and a copy of Exhibit A to this Agreement. In the event that this
Agreement is executed by the Corporation and the Participant prior to the
completion of Exhibit A, the Corporation shall complete Exhibit A within a
reasonable time. The Participant shall not be entitled to any payment under this
Agreement except in accordance with the performance criteria and other factors
with respect to such payment as shall have been set forth on a copy of Exhibit A
that shall have been executed by both the Corporation and the Participant and
attached to this Agreement.
 
        (c)  Notwithstanding the acceptance of Exhibit A by the Corporation and
the Participant, as evidenced by their execution and attachment hereto of a copy
thereof, the performance factors applicable to the Long-Term Performance Award
may be adjusted as the Committee deems necessary or appropriate in the manner
permitted by and subject to the Plan.
 
2.  Termination and Forfeiture.
 
        (a)  If a Participant terminates his or her employment or his or her
consultancy during the Performance Period related to the Long-Term Performance
Award because of death or Disability, the Committee may in its discretion
provide for an earlier payment and settlement of the Long-Term Performance
Award, which payment may be in such amount and under such terms and conditions
as the Committee deems appropriate.
 
        (b)  If a Participant terminates his or her employment or his or her
consultancy during a Performance Period because of Retirement, then such
Participant shall continue to be entitled to a prorata portion of any payment
with respect to the Long-Term Performance Award subject to such Performance
Period in accordance with the payment terms set forth in subsection (e) of
Section 9 of the Plan, determined by multiplying such payment, calculated as if
the Participant's employment or consultancy had not been terminated, by a
fraction the numerator of which is the number of days from the beginning of the
Performance Period to the date of such termination and the denominator of which
is the total number of days during the Performance Period.
 
-2-

--------------------------------------------------------------------------------

        (c)  If a Participant terminates employment or his or her consultancy
during a Performance Period for any reason other than death, Disability or
Retirement, then such a Participant shall not be entitled to any payment with
respect to the Long-Term Performance Award subject to such Performance Period,
unless the Committee shall otherwise determine in its discretion.
 
3.  Payment. The earned portion of the Long-Term Performance Award shall be paid
in cash within two hundred seventy (270) days following the close of the
applicable Performance Period, provided that the Committee may elect to pay up
to one-third (1/3) of such amount in whole shares of Stock or, at the discretion
of the Committee, such earned portion may be paid in whole shares of Stock to
the extent requested by the Participant. Any such shares of Stock shall be
valued at their Fair Market Value at the close of business on the most recent
trading day preceding the date of such payment.
 
4.  No Employment Rights. No provision of this Agreement shall:
 
        (a)  confer or be deemed to confer upon the Participant any right to
continue in the employ of the Corporation or any Subsidiary or shall in any way
affect the right of the Corporation or any Subsidiary to dismiss or otherwise
terminate the Participant’s employment at any time for any reason with or
without case, or
 
        (b)  be construed to impose upon the Corporation or any Subsidiary any
liability for any forfeiture of the Long-Term Performance Award which may result
under this Agreement if the Participant’s employment is so terminated, or
 
        (c)  affect the Corporation’s right to terminate or modify any
contractual relationship with the Participant if the Participant is not an
employee of the Corporation or a Subsidiary;
 
5.  No Liability for Business Acts or Omissions. The Participant recognizes and
agrees that the Board or the officers, agents or employees of the Corporation in
their conduct of the business and affairs of the Corporation, may cause the
Corporation to act, or to omit to act, in a manner that may, directly or
indirectly, affect the amount of or the ability of the Participant to earn the
Long-Term Performance Award under this Agreement. No provision of this Agreement
shall be interpreted or construed to impose any liability upon the Corporation,
the Board or any officer, agent or employee of the Corporation for any effect on
the Participant’s entitlement under the Long-Term Performance Award that may
result, directly or indirectly, from any such action or omission.
 
-3-

--------------------------------------------------------------------------------

6.  Change in Control.
 
        (a) Subject to the terms of any Employment or Change in Control
Agreement between the Corporation and the Participant, upon the occurrence of a
Change in Control followed by the termination of the Participant’s employment
during the succeeding thirty-six (36) months other than (A) by the Corporation
for Cause, (B) by reason of death or Disability, or (C) by the Participant
without Good Reason, then, and only then, the Long-Term Performance Award shall
be deemed fully vested and fully earned and shall be canceled in exchange for a
cash payment equal to 100% of the target value of such Award.
 
        (b) In the event that, following a Change in Control, and provided the
provisions of Section 15(i)(i) of the Plan are inapplicable, the Committee shall
determine in its sole discretion that the event(s) or transaction(s)
constituting the Change in Control have caused the Committee to be unable to
determine whether or not the performance factors and/or other criteria
applicable to one or more Long-Term Performance Awards granted and outstanding
under Section 9 of the Plan have (or have not), in fact been met or satisfied,
then, with respect to each such Long-Term Performance Award, the Committee
shall: (A) cancel the Award and make a payment to the Participant in an amount
equal to 100% of the initial target value of such Award as previously determined
by the Committee under Section 9(b) of the Plan; or (B) cancel the Award, modify
the provisions of Section 9 of the Plan as may be necessary to grant Long Term
Performance Awards which are substantially equivalent to those permitted prior
to such Change in Control, and grant to the Participant a new Long-Term
Performance Award under such terms and conditions as the Committee shall
establish under Section 9 of the Plan, which will provide a payment opportunity
to the Participant substantially equivalent to such cancelled Award.
 
7.   Committee’s Discretion. If the Committee has designated the Long-Term
Performance Award as a Qualified Performance-Based Award, as defined in the
Plan, then the Committee shall not exercise any discretion that it might
otherwise have the ability to exercise under Section 9(c), or any other section,
of the Plan in a way that would increase the amount of the Long-Term Performance
Award in a manner that is inconsistent with the exemption for performance-based
compensation set forth in Section 162(m) of the Code.
 
-4-

--------------------------------------------------------------------------------

8.   Changes in Capitalization.
 
        (a)  This Agreement and the issuance of any shares of Stock in payment
or partial payment of the Long-Term Performance Award shall not affect in any
way the right or power of the Corporation or its shareholders to make or
authorize any or all adjustments, recapitalizations, reorganizations or other
changes in the Corporation’s capital structure or its business, or any merger or
consolidation of the Corporation, or any issue of bonds, debentures, preferred
or prior preference stocks ahead of or affecting the Stock or the rights
thereof, or the transfer of all or any part of its assets or business, or any
other corporate act or proceedings, whether of a similar character or otherwise.
 
        (b)  In the event of recapitalization, stock split, stock dividend,
divisive reorganization or other change in capitalization affecting the
Corporation’s shares of Stock, an appropriate adjustment will be made in respect
of any shares of Stock delivered to the Participant in payment of any or all of
Participant’s entitlement under the Long-Term Performance Award.
 
     9.   Capitalized Terms. All capitalized terms not defined herein shall have
the meaning ascribed to them in the Plan.
 
    10.  Interpretation. This Agreement shall at all times be interpreted,
administered and applied in a manner consistent with the provisions of the Plan.
In the event of any inconsistency between the terms of this Agreement and the
terms of the Plan, the terms of the Plan shall control and the Plan is
incorporated herein by reference.
 
    11.  Amendment; Modification; Waiver. No provision of this Agreement may be
amended, modified or waived unless such amendment, modification or waiver shall
be authorized by the Committee and shall be agreed to in writing by the
Participant.
 
    12.  Complete Agreement. This Agreement contains the entire Agreement of the
parties relating to the subject matter of this Agreement and supersedes any
prior agreements or understandings with respect thereto.
 
-5-

--------------------------------------------------------------------------------

    13.  Agreement Binding. This Agreement shall be binding upon and inure to
the benefit of the Corporation, its successors and assigns and the Participant,
his heirs, devisees and legal representatives.
 
    14.  Legal Representative. In the event of the Participant’s death or a
judicial determination of his incompetence, reference in this Agreement to the
Participant shall be deemed to refer to his legal representative, heirs or
devisees, as the case may be.
 
    15.  Business Day. If any event provided for in this Agreement is scheduled
to take place on a day on which the Corporation’s corporate offices are not open
for business, such event shall take place on the next succeeding day on which
the Corporation’s corporate offices are open for business.
 
    16.  Titles. The titles to sections or paragraphs of this Agreement are
intended solely for convenience and no provision of this Agreement is to be
construed by reference to the title of any section or paragraph.
 
    17.  Notices.
 
      (a)  Any notice to the Corporation pursuant to any provision of this
Agreement will be deemed to have been delivered when delivered in person to the
President or Secretary of the Corporation or when deposited in the United States
mail, addressed to the President or Secretary of the Corporation, at the
Corporation’s corporate offices, or such other address as the Corporation may
from time to time designate in writing.
 
      (b) Any notice to the Participant pursuant to any provision of this
Agreement will be deemed to have been delivered when delivered to the
Participant in person or when deposited in the United States mail, addressed to
the Participant at this address on the shareholder records of the Corporation or
such other address as the Participant may from time to time designate in
writing.
 

 

-6-

--------------------------------------------------------------------------------

IN WITNESS WHEREOF, the parties have caused this Agreement to be executed as of
the date first written above.
 
Participant 
   
KAMAN CORPORATION
   
By
 
 
   
Its

 

--------------------------------------------------------------------------------

 

EXHIBIT A

LONG-TERM PERFORMANCE PROGRAM
[2006 - 2008] PERFORMANCE PERIOD

Performance Period

The performance period approved by the Personnel and Compensation Committee at
the [November 8, 2005] meeting measures Kaman performance for the period January
1, [2006] through December 31, [2008].

Participant and Target Awards

The participant was approved by the Personnel and Compensation Committee at the
[November 8, 2005] meeting for participation for this performance period and the
target award is:
   
 
 Target Award as % of Base Salary at
 Participant
 the Beginning of the Performance Period
 Name
XX%

   
This participant is designated as a Covered Employee under Section 2 (j) of the
Kaman Corporation 2003 Stock Incentive Plan.

Performance Measures

The specific performance measures and their weighting are:
    

 Performance Measure     Weighting        Average return on total capital  
 [40%]
 Growth in earnings per share  
 [40%]
 Total return to shareholders  
 [20%]

 
Average return on capital will be the simple average of total return on capital
achieved in each of the three (3) years of the performance priod.

Growth in earnings per share will be calculated by taking the simple average of
Kaman’s earnings per share for each of the three (3) years of the performance
period and computing the compound growth rate of that average over the
base period EPS. The base period EPS is the simple average of Kaman’s EPS for
the years [2003],[2004] and [2005].

Total return to shareholders will be calculated on a dividends reinvested basis
and will measure the change in value of an investment in Kaman shares for the
period January 1, [2006] through December 31, [2008].

--------------------------------------------------------------------------------

Benchmark for Performance:
 
Kaman performance will be measured on a relative basis against the performance
of the Russell 2000 index companies for the period January 1, [2006] through
December 31, [2008] using the same performance measures:

 
•
Average return on total capital

 
•
Growth in earnings per share

 
•
Total return to shareholders

In measuring the performance of the Russell 2000 companies, average return on
total capital and total return to shareholders will be measured in the same way
as Kaman’s performance is measured.

In measuring growth in earnings per share for the Russell 2000 index companies,
the calculation will be the same except that the base year will be the earnings
per share for [2005].
 
 
Determination of Earned Award
 
In determining the actual award earned, each performance measure will be
measured separately and the total of the three calculations will equal the total
award earned
 
The actual award earned for each performance measure will be based on a
comparison of Kaman’s performance as compared to that of the Russell 2000 index
companies as follows:
 

 Kaman Performance vs. Russell 2000 Companies     % of Target Award Earned      
 Below 25th percentile
 
 None
 25th percentile
 
 25%
 50th percentile
 
 100%
 75th percentile & above
 
 200%

 
The percent of the target award earned for actual performance between the 25th
and the 50th percentile and between the 50th and 75th percentile will be
determined on a straight-line interpolation.

All payments are meant to qualify as Qualified Performance-Based Awards under
Section 15 (c) of the Kaman Corporation 2003 Stock Incentive Plan.

IN WITNESS WHEREOF, the parties have caused this Agreement to be executed as of
the date first written above.

Participant 
   
KAMAN CORPORATION
   
By
 
Dated:
   
Its