[Form of Opinion]
Exhibit 8.2
____________, 1999
Camden National Corporation
P.O. Box 310
Camden, ME 04843
Ladies and Gentlemen:
We refer to the transaction described in a so-called "Agreement and Plan of
Merger by and among Camden National Corporation, Camden Acquisition Subsidiary,
Inc., KSB Bancorp, Inc., and Kingfield Savings Bank"(the "Agreement"), the most
recent draft of which is dated July 27, 1999. Any capitalized term used and not
defined herein has the same meaning given to it in said Agreement.
Pursuant to the terms of the Agreement, Camden Acquisition Subsidiary, Inc., a
newly-formed, direct, wholly-owned subsidiary of Camden National Corporation,
will be merged with and into KSB Bancorp, Inc.(the "Merger"). Subsequent to the
Merger, KSB Bancorp, Inc. will merge with and into Camden National Corporation
(the "Subsequent Merger"). Finally, United Bank will merge with and into
Kingfield Savings Bank (the "Bank Merger").
Xxxxx Xxxx XxXxxx & Xxxxxx, LLC (the "Firm") has been requested to provide an
opinion (the "Opinion") as to certain federal income tax consequences resulting
from the Merger. Specifically, with respect to these matters, you have asked the
Firm to address the federal income tax consequences of the following questions:
1. Whether the Merger and Subsequent Merger and Bank Merger will each
constitute a "reorganization" within the meaning of Section 368(a)(1) of
Internal Revenue Code of 1986, as amended (the "Code")?
2. Whether Camden National Corporation, Camden Acquisition Subsidiary, Inc.,
KSB Bancorp, Inc., United Bank, and Kingfield Savings Bank will each be a
"party to the reorganization" within the meaning of Section 368(b) of the
Code?
3. Whether gain or loss will be recognized to the Camden National Corporation
or its shareholders as a result of the transaction?
In rendering the Opinion, representatives of the Firm have relied upon the
accuracy and completeness of the facts, information, and representations
contained in the Agreement and other documents which we have deemed relevant and
necessary (these items are hereafter collectively
Camden National Corporation
, 1999
Page 2
referred to as the "Documents"). The Opinion is conditioned, among other things,
not only upon such accuracy and completeness as of the date of such documents,
but also upon the continuing accuracy and completeness thereof as of the
Effective Time and Subsequent Effective Time.
Additionally, the Opinion is explicitly conditioned upon representations
contained in a certain letter dated as of the date hereof from Camden National
Corporation, (the "Representation Letter"). In that regard, the Firm hereby
incorporates by reference all of the statements of facts and factual
representations contained in the Documents and Representation Letter and, for
purposes of rendering the Opinion, the Firm has assumed (without attempting any
independent verification) that all of the statements of facts and factual
representations set forth in the Documents and Representation Letter are true
and complete.
I. OPINION
Based upon the foregoing facts, factual assumptions and representations set
forth in Sections II and III hereof, and the Code, Committee Reports,
legislative history and the relevant Internal Revenue Service and judicial
precedents as of the date hereof, the Firm is of the Opinion that:
1. The Merger, Subsequent Merger and Bank Merger will each constitute a
"reorganization" within the meaning of Section 368(a)(1) of the Code.
2. Camden National Corporation, Camden Acquisition Subsidiary, Inc., KSB
Bancorp, Inc., United Bank, and Kingfield Savings Bank will each be a
"party to the reorganization" within the meaning of Section 368(b) of the
Code.
3. No gain or loss will be recognized to Camden National Corporation, its
shareholders, its members, and the resulting reorganized entities as a
result of the transactions.
II. FACTS
A. TRANSACTION
For what has been represented to be valid business reasons, pursuant to the
Agreement, the following transactions will occur:
1. Camden Acquisition Subsidiary, Inc. will be formed as described above.
2. Camden Acquisition Subsidiary, Inc. will merge with and into KSB Bancorp,
Inc. pursuant to the applicable state laws with KSB Bancorp, Inc. being the
surviving corporation. As described in Section 3.1(a) of the Agreement,
each share of common stock of KSB Bancorp, Inc. will be converted into and
become the right to receive 1.136 shares of Camden National Corporation
common stock.
3. Each outstanding share of Camden Acquisition Subsidiary, Inc will be
converted into and exchangeable for one share of common stock of KSB
Bancorp, Inc.
Camden National Corporation
, 1999
Page 3
4. No fractional shares of Camden Common Stock will be issued. In lieu
thereof Camden National Corporation will pay an amount of cash determined
pursuant to the provisions of Section 3.3 of the Agreement.
5. Soon after the Merger, Camden National Corporation shall cause KSB
Bancorp, Inc. to merge with and into Camden National Corporation (the
"Subsequent Merger".)
6. Soon after the Merger, Camden National Corporation shall cause United Bank
to merge with and into Kingfield Savings Bank (the "Bank Merger".)
III. REPRESENTATIONS
The following representations were made by the management of Camden National
Corporation. Camden National Corporation understands that these representations
form an integral part of the Firm's opinion regarding the Merger:
1. The Merger, Subsequent Merger and Bank Merger will be consummated in
compliance with the material terms of the Agreement and none of the
material terms and conditions therein have been waived or modified and
Camden National Corporation has no plan or intention to waive or modify
further any such material condition.
2. The ratio for the exchange of shares of stock of KSB Bancorp, Inc. for
common stock of Camden National Corporation in the Merger was negotiated
through arm's length bargaining. Accordingly, the fair market value of the
Camden National Corporation common stock to be received by KSB Bancorp,
Inc. stockholders in the Merger will be approximately equal to the fair
market value of the KSB Bancorp, Inc. stock surrendered by such
stockholders in exchange therefor.
3. The management of Camden National Corporation knows of no plan or
intention by any stockholder of KSB Bancorp, Inc. to sell, exchange,
transfer by gift or otherwise dispose of any of the shares of common stock
of Camden National Corporation to be received by them in the Merger. In
addition, the management of Camden National Corporation is not aware of
any transfers of KSB Bancorp, Inc. stock by any holders thereof prior to
the Effective Date which were made in contemplation of the Merger.
4. As a result of the Merger, KSB Bancorp, Inc. will transfer to Camden
Acquisition Subsidiary, Inc. at least ninety percent (90%) of the fair
market value of the net assets and at least seventy percent (70%) of the
fair market value of the gross assets of KSB Bancorp, Inc. held by it
immediately prior to the Merger. For this purpose, amounts used to pay
dissenters or to pay reorganization expenses, and all redemptions and
distributions (except for regular, normal dividends) made by KSB Bancorp,
Inc. immediately prior to the Merger will be considered as assets held by
KSB Bancorp, Inc. immediately prior to the Merger. The management of
Camden National Corporation is not aware of KSB Bancorp, Inc. having
redeemed any of its stock, having made any distribution with respect to
any of the its stock, or having disposed of any of its assets in
anticipation of or as a part of a plan for the acquisition of it by Camden
Acquisition Subsidiary, Inc.
Camden National Corporation
, 1999
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5. Prior to the Merger, Camden National Corporation will be in control of
Camden Acquisition Subsidiary, Inc. within the meaning of Section 368(c) of
the Code.
6. Camden National Corporation has no plan or intention to reacquire any of
its stock issued in the Merger.
7. Camden National Corporation is the owner of all of the outstanding stock of
Camden Acquisition Subsidiary, Inc.
8. The liabilities to which the transferred assets of KSB Bancorp, Inc. are
subject were incurred by KSB Bancorp, Inc. in the ordinary course of its
business. No liabilities of any person other than KSB Bancorp, Inc. will be
assumed by Camden National Corporation in the Subsequent Merger, and none
of the shares of KSB Bancorp, Inc. to be surrendered in exchange for Camden
National Corporation common stock in the Merger will be subject to any
liabilities.
9. Immediately after the Merger and Subsequent Merger, Camden National
Corporation intends to cause KSB Bancorp, Inc to continue the historic
business of KSB Bancorp, Inc. or use a significant portion of the historic
business assets of KSB Bancorp, Inc. in a business.
10. Camden National Corporation, Camden Acquisition Subsidiary, Inc. and KSB
Bancorp, Inc. will pay their respective expenses, if any, incurred in
connection with the Merger. Camden National Corporation, Camden Acquisition
Subsidiary, Inc. and KSB Bancorp, Inc. will not pay any of the expenses of
the stockholders of KSB Bancorp, Inc. incurred in connection with the
Merger.
11. There is no intercorporate indebtedness existing between Camden National
Corporation and KSB Bancorp, Inc. or between Camden Acquisition Subsidiary,
Inc. and KSB Bancorp, Inc. that was issued, acquired, or will be settled at
a discount.
12. Camden National Corporation is not an investment company as defined in
Section 368(a)(2)(F)(iii) and (iv) of the Code.
13. KSB Bancorp, Inc. is not under the jurisdiction of a court in a Title 11 or
similar case within the meaning of Section 368(a)(3)(A) of the Code.
14. On the date of the Merger, the fair market value of the assets of KSB
Bancorp, Inc. will exceed the sum of its liabilities (including any
liabilities to which its assets are subject).
15. No stock of Camden Acquisition Subsidiary, Inc. will be issued in the
Merger.
16. The payment of cash in lieu of fractional shares of stock of KSB Bancorp,
Inc. was not separately bargained for consideration and is being made for
the purpose of saving Camden National Corporation the expense and
inconvenience of issuing fractional shares.
Camden National Corporation
, 1999
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17. None of the compensation received by any stockholder-employee of KSB
Bancorp, Inc. (or its subsidiaries) pursuant to any employment, consulting
or similar arrangement is or will be separate consideration for, or
allocable to, any of his shares of KSB Bancorp, Inc. stock. None of the
shares of common stock of Camden National Corporation received by any
stockholder-employee of KSB Bancorp, Inc. (or its subsidiaries) pursuant to
the Merger (other than any such shares received in connection with the
termination in the Merger of certain stock options to purchase KSB Bancorp,
Inc. common stock) are or will be separate consideration for, or allocable
to, any such employment, consulting or similar arrangement. The
compensation paid to any stockholder-employee of KSB Bancorp, Inc. (or its
subsidiaries) pursuant to any such employment, consulting or similar
arrangement is or will be for services actually rendered and will be
commensurate with amounts paid to third parties bargaining at arm's length
for similar services.
IV. CAVEATS AND LIMITATIONS
It is assumed for the purpose of this Opinion that the management of Camden
National Corporation, Camden Acquisition Subsidiary, Inc., KSB Bancorp, Inc.,
United Bank, and Kingfield Savings Bank are not aware of any facts inconsistent
with those set forth above and in the Documents. Also, it is assumed that the
Documents accurately reflect all consummated and proposed transactions. The
existence of inconsistent facts and/or consummated or proposed transactions not
set forth in the Documents could materially alter our opinions.
Additionally, the opinions expressed herein are based upon the provisions of the
Code, Treasury Regulations promulgated thereunder, judicial decisions, revenue
rulings and procedures and related authorities issued to, and in effect on, the
date of this opinion.
Furthermore, no assurance can be given that the Internal Revenue Service or the
courts will not alter their present views, either prospectively or
retroactively, or adopt new views in respect of our opinions. In that event, the
opinions expressed herein would necessarily have to be reevaluated in light of
any change in such views. We assume no obligation to advise you of any change in
any such provisions or views which would affect our opinions set forth herein.
Our opinion is based solely upon the facts, representations and assumptions
contained herein, and we have not undertaken an independent investigation of any
such facts or representations. Our opinion would require reevaluation in the
event of any change in any such fact or representation.
The opinions expressed in this opinion reflect what we believe to be the Federal
income tax consequences of the transactions described herein. Nevertheless, they
are only opinions, and no assurance can be given that the Internal Revenue
Service will not challenge any position taken in such opinions. Furthermore, it
should be noted that we express no opinion regarding tax consequences under the
laws of any state or local jurisdiction.
Camden National Corporation
, 1999
Page 6
V. SUBSTANTIAL AUTHORITY
Without limiting the foregoing, providing the facts, assumptions, and
representations contained herein are correct, substantial authority, within the
meaning of Section 6662 of the Code, exists to each of the conclusions made in
this opinion.
VI. CONSENT
The opinions expressed herein are provided solely for the benefit of Camden
National Corporation, its shareholders, its members, and the resulting
reorganized entities. This letter should not be distributed to, nor may it be
relied upon by, any other organization or person; provided, however, that the
Firm hereby consents to the filing of this letter as an exhibit to the
Registration Statement.
Sincerely,
Xxxxx, Xxxx, XxXxxx & Xxxxxx, LLC
