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

NONQUALIFIED STOCK OPTION AGREEMENT
 
(Under the Kaman Corporation
 
2013 Management Incentive Plan)
 
THIS NONQUALIFIED STOCK OPTION AGREEMENT (this “Agreement”), is 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 “Company”), and «FIRST_NAME» «MI» «LAST_NAME» (the “Participant”).

 
Grant Date:
 
[Insert Date] 
     
Option Price per Share:
 
[Insert Exercise Price] 
     
Number of Option Shares:
 
[Insert Number of Shares] 
     
Expiration Date:
 
[Insert Expiration Date] 

       1.  Grant of Option.  Subject to the terms and conditions set forth in
this Agreement, the Company hereby grants to the Participant, effective as of
the Grant Date set forth above (the “Grant Date”), the right and option (the
“Option”), exercisable during the period commencing on the Grant Date and ending
on the Expiration Date set forth above (the “Expiration Date”), to purchase from
the Company from time to time, up to but not exceeding in the aggregate the
total number of shares of Common Stock of the Company equal to the number of
Option Shares set forth above (the “Option Shares”); provided, however, that the
exercise of the Option shall be restricted as set forth in Section 2 of this
Agreement.  This Option is granted under, and is subject to all of the terms and
provisions of, the Kaman Corporation 2013 Management Incentive Plan (the
“Plan”). All capitalized terms used but not otherwise defined herein shall have
the meanings ascribed to them in the Plan.
 
2.  Terms and Conditions of Option.  The following terms and conditions shall
apply to the Option:
 
(a)  Option Price.  The purchase price of each Share subject to the Option shall
be the Option Price Per Share set forth above (the “Option Price”), being the
closing price of a Share as reported by the New York Stock Exchange on the most
recent trading day immediately preceding the Grant Date.
 
(b)  Type of Option.  The Option is a Nonqualified Stock Option (as defined in
the Plan), which shall not be deemed to meet the requirements of an “incentive
stock option” under Section 422 of the Internal Revenue Code of 1986, as
amended, or any successor provision.
 
(c)  Acceptance of Option.  No later than sixty (60) days after the Grant Date,
the Participant must accept the Option by executing and delivering a counterpart
copy of this Agreement to the Chief Human Resources Officer of the Company at
the Company’s principal executive offices located in Bloomfield,
Connecticut.  By accepting the Option, the Participant acknowledges receipt of a
copy of the Plan and this Agreement.  The Participant represents and warrants
that the Participant has read and understands the terms and provisions of the
Plan and this Agreement, and the Participant hereby agrees to be bound by such
terms and provisions.
 
 
- 1 -

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

 
 
(d)  Period of Option.  The Option shall have a term of ten (10) years  from the
Grant Date; provided, however, that unless the Option shall have already expired
by its terms, the Option or the unexercised portion thereof (to the extent
exercisable on the date of termination of employment) shall terminate at the
close of business on the day three (3) months following the date on which the
Participant ceases to be employed by the Company or a Subsidiary, unless a
longer period is provided under subsection (g) of this Section in the case of
death, Disability or Retirement.  Notwithstanding the foregoing, if the
Participant’s employment is terminated for “Cause” (as defined below), the
unexercised portion of this Option shall terminate on the date the Participant
ceases to be employed by the Company or a Subsidiary.  For purposes of this
Option, “Cause” means (i) the willful refusal by the Participant to perform
proper responsibilities of the Participant’s position with the Company or a
Subsidiary, (ii) a violation of law by the Participant which adversely affects
the assets, financial position or reputation of the Company or a Subsidiary, or
(iii) a violation by the Participant of any code of ethics, code of conduct or
similar policy maintained by the Company or a Subsidiary.  A Participant’s
service shall be deemed to have terminated for Cause if, after the Participant’s
service has terminated, facts and circumstances are discovered that would have
justified a termination for Cause.
 
(e)  Exercise of Option.  The Option shall be exercisable with respect to twenty
percent (20%) of the Shares subject thereto on March 1, 20[__], and shall be
exercisable as to an additional twenty percent (20%) of such Shares on March 1
of each of the next succeeding four (4) years, on a cumulative basis, so that
the Option, or any unexercised portion thereof, shall be fully exercisable on
and after March 1, 20[__].  The Participant may not exercise the Option or any
part thereof unless at the time of such exercise the Participant shall be
employed by the Company or a Subsidiary and shall have been so employed
continuously since the Grant Date, except leaves of absence approved by the
Committee; provided, however, that an Participant may exercise the Option during
the periods described in subsections (d) and (g) of this Section following such
continuous employment unless the Option shall have already expired by its
terms.  The Option shall be exercised in the manner set forth in Section 3 of
this Agreement. Any obligation of the Company to issue the Shares as to which
such Option is being exercised shall be conditioned upon the Company’s ability
at nominal expense to issue such Shares in compliance with all applicable
statutes, rules or regulations of any governmental authority.  The Company may
secure from the Participant any assurances or agreements that the Committee, in
its sole discretion, shall deem necessary or advisable in order that the
issuance of such Shares shall comply with any such statutes, rules or
regulations.
 
(f)  Nontransferability.  The Option shall not be transferable by the
Participant otherwise than by will or by the laws of descent and distribution,
and the Option shall be exercisable, during the Participant’s lifetime, only by
the Participant.
 
 
- 2 -

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

 
 
(g)  Death, Disability or Retirement.
 
(i)  In the event of the death, Disability or Retirement of the Participant
while in the employ of the Company or a Subsidiary, the Option may be exercised
within the period of five (5) years succeeding such Participant’s death,
Disability or Retirement, but in no event later than the Expiration Date, by the
person or persons designated in the Participant’s will for that purpose or in
the absence of any such designation, by the legal representative of the
Participant’s estate, or by the Participant or the Participant’s legal
representative, as the case may be.
 
(ii)  During any period following termination of employment by reason of death,
Disability or Retirement during which the Option may be exercisable as provided
in subsection (g)(i) above, such Option shall continue to vest in accordance
with its terms and be and become exercisable as if employment had not ceased.
 
(iii)  As used in this Agreement, the term “Retirement” means the termination of
a Participant’s employment with the Company or a Subsidiary other than for Cause
(a) after attaining age 62 with at least five years of employment service or (b)
after attaining age 65, the term “Disability” or “Disabled” means permanent and
total disability as defined by Code Section 22(e)(3), and the term “Code” means
the Internal Revenue Code of 1986, as amended from time to time, and any
successor Code, and related rules, regulations and interpretations.
 
(h)  Shareholder Rights.  The Participant shall not be entitled to any rights as
a shareholder with respect to any Shares subject to the Option prior to the date
of issuance to the Participant of such Shares.
 
3.  Manner of Exercise of Option.
 
(a)  The Option shall be exercised by delivering to the Company from time to
time a signed statement of exercise specifying the number of Shares to be
purchased, together with cash or a check made payable to the order of the
Company for an amount equal to the aggregate Option Price of such
Shares.  Payment in full or in part may also be made by delivery of (i)
irrevocable instructions to a broker to deliver promptly to the Company the
amount of sale or loan proceeds to pay the aggregate Option Price, or (ii)
previously owned Shares not then subject to restrictions under any Company plan
(but which may include shares of Common Stock the disposition of which
constitutes a disqualifying disposition for purposes of obtaining incentive
stock option treatment for federal tax purposes), (iii) Shares otherwise
receivable upon the exercise of this Option, provided, however, that in the
event that, in any given instance, the exercise of this Option by withholding
Shares otherwise receivable would be unlawful, unduly burdensome or otherwise
inappropriate, the Company may require that such exercise be accomplished in
another acceptable manner, (iv) any other legal consideration that the Company
may deem appropriate, or (v) any combination of the foregoing.  For purposes of
this Section 3, any such surrendered Shares shall be valued at the closing price
of the Company’s Common Stock on the New York Stock Exchange on the most recent
trading day preceding the date of exercise on which sales of the Shares
occurred.
 
 
- 3 -

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

 
 
(b)  The issuance of optioned Shares shall be conditioned on the Participant
having either (i) paid, or (ii) made provisions satisfactory to the Committee
for the payment of, all applicable tax withholding obligations.  The Company and
its Subsidiaries shall, to the extent permitted by law, have the right to deduct
any such taxes from any payment of any kind otherwise due to the
Participant.  In addition, the Company in its discretion, but only upon the
written request of the Participant, may permit the Participant to satisfy any
and all applicable federal, state, local and foreign income tax withholding
requirements (including Participant’s FICA or employment tax obligations)
occasioned by the exercise thereof by the surrender of Shares otherwise to be
received on the exercise of such Option.  For purposes of this subsection (b),
such surrendered Shares shall be valued at the closing price of the Company’s
Common Stock in the New York Stock Exchange on the most recent trading day
preceding the date of exercise on which sales of the Shares occurred.
 
(c)  Within twenty (20) days after such exercise of the Option in whole or in
part, the Company shall use commercially reasonable efforts to cause the Shares
with respect to which the Option shall be so exercised to be issued in
uncertificated form in the Participant’s name, provided that, if the stock
transfer books of the Company are closed for the whole or any part of said
twenty (20) day period, then such period shall be extended accordingly.  Each
purchase of Shares hereunder shall be a separate and divisible transaction and a
completed contract in and of itself.
 
4.  Stock Reservations.  The Company shall at all times during the term of this
Agreement reserve and keep available such number of Shares as will be sufficient
to satisfy the requirements of this Agreement, and shall pay all original issue
taxes, if any, on the exercise of the Option, and all other fees and expenses
necessarily incurred by the Company in connection therewith.
 
5.  Termination of Option.  If the Participant shall no longer be a full-time
salaried employee of the Company or a Subsidiary, the Participant’s employment
being terminated for any reason other than death, Disability or Retirement, any
unexercised portion of the Option shall terminate at the close of business on
the day three (3) months following the date of the termination of Participant’s
employment, unless such Option shall have already expired by its terms.  This
Option shall be exercisable, if at all, during such three (3) month period only
to the extent exercisable on the date of termination of employment. For purposes
of this Option, a transfer of the employment of Participant from the Company to
a Subsidiary, or vice versa, or from one Subsidiary to another Subsidiary, shall
not be deemed a termination of employment.  Notwithstanding the foregoing, if
the Participant’s employment is terminated for Cause, any unexercised portion of
this Option shall immediately terminate on the date his or her employment
terminates.
 
6.  Effect on Changes in Capital Structure.  The existence of the Option shall
not affect in any way the right or power of the Company or its stockholders to
make or authorize any or all adjustments, recapitalizations, reorganizations or
other changes in the Company’s capital structure or its business, or any merger
or consolidation of the Company, or any issue of bonds, debentures, preferred or
prior preference stocks ahead of or affecting the Shares or the rights thereof,
or the dissolution or liquidation of the Company, or any sale or 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.
 
 
- 4 -

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

 
 
7.  Dilution or Other Adjustments.  In the event that prior to issuance by the
Company of all the Shares subject to the Option, the Company shall have effected
one or more stock splits, stock dividends, mergers, reorganizations,
consolidations, combinations or exchanges of shares, recapitalizations or
similar capital adjustments, the Board of Directors of the Company shall
equitably adjust the number, kind and Option price of the Shares remaining
subject to the Option in order to avoid dilution or enlargement of Option
rights.
 
8.  Compliance with Laws.  Notwithstanding any of the provisions hereof, the
Participant agrees for himself/herself and his/her legal representatives,
legatees and distributees that the Option shall not be exercisable, and that the
Company shall not be obligated to issue any Shares hereunder, if the exercise of
said Option or the issuance of such Shares shall constitute a violation by the
Option holder or the Company of any provision of any law or regulation of any
governmental authority.
 
9.  Notices.
 
(a)  Any notice to the Company 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 Company, when deposited in the United States mail, addressed to
the President or Secretary of the Company, at the Company’s corporate offices,
when delivered to the President or Secretary of the Company by electronic mail,
or when delivered to such other address as the Company 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, when deposited in the United States mail, addressed to the Participant
at the address on the shareholder records of the Company, when delivered to the
Participant by electronic mail, or when delivered to such other address as the
Participant may from time to time designate in writing.
 
10.  Administration and Interpretation.  The administration of the Option shall
be subject to such rules and regulations as the Committee deems necessary or
advisable for the administration of the Plan.  The determination or the
interpretation and construction of any provision of the Option by the Committee
shall be final and conclusive upon all concerned, unless otherwise determined by
the Board of Directors of the Company.  The Option shall at all times be
interpreted and applied in a manner consistent with the provisions of the Plan,
and in the event of any inconsistency between the terms of the Option and the
terms of the Plan, the terms of the Plan shall control, the terms of the Plan
being incorporated herein by reference.  By accepting the Option, the
Participant hereby consents to the transfer of such Participant’s personal data
in connection with, or as necessary or appropriate for, the administration of
this award and the Plan under which is it issued.
 
11.  Counterparts.  This Agreement may be executed in counterparts, each of
which shall be deemed an original but all of which together will constitute one
and the same instrument. Counterpart signature pages to this Agreement
transmitted by facsimile transmission, by electronic mail in portable document
format (.pdf), or by any other electronic means intended to preserve the
original graphic and pictorial appearance of a document, will have the same
effect as physical delivery of the paper document bearing an original signature.
 
 
- 5 -

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

 
 
12.  Electronic Delivery. In lieu of receiving documents in paper format, the
Participant agrees, to the fullest extent permitted by law, to accept electronic
delivery of any documents that the Company may be required to deliver
(including, but not limited to, prospectuses, prospectus supplements, grant or
award notifications and agreements, account statements, annual and quarterly
reports, and all other agreements, forms and communications) in connection with
this and any other prior or future incentive award or program made or offered by
the Company or its predecessors or successors.  Electronic delivery of a
document to the Participant may be via a Company e-mail system or by reference
to a location on a Company intranet site to which the Participant has access.
 
13.  Compensation Recovery.  The Company may cancel, forfeit or recoup any
rights or benefits of, or payments to, the Participant hereunder, including but
not limited to any Shares issued by the Company following the exercise of the
Option under this Agreement or the proceeds from the sale of any such Shares,
under any future compensation recovery policy that it may establish and maintain
from time to time, to meet listing requirements that may be imposed in
connection with the Dodd-Frank Wall Street Reform and Consumer Protection Act or
otherwise.  The Company shall delay the exercise of its rights under this
Section for the period as may be required to preserve equity accounting
treatment.
 
14.  Taxes; Limitation on Excess Parachute Payments.  The settlement of this
Award is conditioned on the Participant making arrangements reasonably
satisfactory to the Company for the withholding of all applicable federal,
state, local or foreign taxes as may be required under applicable law.  The
Participant shall bear all expense of, and be solely responsible for, all
federal, state, local or foreign taxes due with respect to any payment received
under this Agreement.  Notwithstanding any other provision in this Agreement to
the contrary, any payment or benefit received or to be received by the
Participant in connection with a Change in Control or the termination of
employment (whether payable under the terms of this Agreement or any other plan,
arrangement or agreement with the Company or one of its Subsidiaries
(collectively, the “Payments”) that would constitute a “parachute payment”
within the meaning of Section 280G of the Code, shall be reduced to the extent
necessary so that no portion thereof shall be subject to the excise tax imposed
by Section 4999 of the Code (the “Excise Tax”), but only if, by reason of such
reduction, the net after-tax benefit received by the Participant shall exceed
the net after-tax benefit that would be received by the Participant if no such
reduction was made.  Whether and how the limitation under this Section 14 is
applicable shall be determined under the Section 280G Rules set forth in Exhibit
A, which shall be enforceable as if set forth in this Agreement.
 
 
- 6 -

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

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

 
KAMAN CORPORATION
 
 
   By:      
 
Name:
   
Participant:
             
PARTICIPANT
     
«FIRST_NAME» «MI» «LAST_NAME»,
 

 
 
 
- 7 -

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

 

Exhibit A—Section 280G Rules

To Nonqualified Stock Option Agreement

The following rules shall apply for purposes of determining whether and how the
limitations provided under Section 14 are applicable to the Participant. 

1.  The “net after-tax benefit” shall mean (i) the Payments (as defined in
Section 14) which the Participant receives or is then entitled to receive from
the Company or a Subsidiary or Affiliate that would constitute “parachute
payments” within the meaning of Section 280G of the Code, less (ii) the amount
of all federal, state and local income and employment taxes payable by the
Participant with respect to the foregoing calculated at the highest marginal
income tax rate for each year in which the foregoing shall be paid to the
Participant (based on the rate in effect for such year as set forth in the Code
as in effect at the time of the first payment of the foregoing), less (iii) the
amount of Excise Tax imposed with respect to the payments and benefits described
in (i) above. 

2.  All determinations under Section 14 of this Agreement and this Exhibit A
will be made by an accounting firm or law firm that is selected for this purpose
by the Company’s Chief Executive Officer prior to a Change in Control (the “280G
Firm”).  All fees and expenses of the 280G Firm shall be borne by the Company. 
The Company will direct the 280G Firm to submit any determination it makes under
Section 14 of this Agreement and this Exhibit A and detailed supporting
calculations to both the Participant and the Company as soon as reasonably
practicable. 

3.  If the 280G Firm determines that one or more reductions are required under
Section 14 of this Agreement, the 280G Firm shall also determine which Payments
shall be reduced (first from cash payments and then from non-cash benefits, in
each such case first from amounts not subject to Section 409A of the Code and
then from amounts subject to Section 409A of the Code, with the Payments that
otherwise would be made last in time reduced first)  to the extent necessary so
that no portion thereof shall be subject to the excise tax imposed by Section
4999 of the Code, and the Company shall pay such reduced amount to the
Participant. 

4.  As a result of the uncertainty in the application of Section 280G at the
time that the 280G Firm makes its determinations under this Section, it is
possible that amounts will have been paid or distributed to the Participant that
should not have been paid or distributed (collectively, the “Overpayments”), or
that additional amounts should be paid or distributed to the Participant
(collectively, the “Underpayments”).  If the 280G Firm determines, based on
either the assertion of a deficiency by the Internal Revenue Service against the
Company or the Participant, which assertion the 280G Firm believes has a high
probability of success or controlling precedent or substantial authority, that
an Overpayment has been made, the Participant must repay to the Company, without
interest; provided, however, that no loan will be deemed to have been made and
no amount will be payable by the Participant to the Company unless, and then
only to the extent that, the deemed loan and payment would either reduce the
amount on which the Participant is subject to tax under Section 4999 of the Code
or generate a refund of tax imposed under Section 4999 of the Code.  If the 280G
Firm determines, based upon controlling precedent or substantial authority, that
an Underpayment has occurred, the 280G Firm will notify the Participant and the
Company of that determination and the amount of that Underpayment will be paid
to the Participant promptly by the Company. 
 
 
- 8 -

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

 
 
5.  The Participant will provide the 280G Firm access to, and copies of, any
books, records, and documents in the Participant’s possession as reasonably
requested by the 280G Firm, and otherwise cooperate with the 280G Firm in
connection with the preparation and issuance of the determinations and
calculations contemplated by Section 14 of this Agreement and this Exhibit A. 
 
 
 
- 9 -

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