-----BEGIN PRIVACY-ENHANCED MESSAGE----- Proc-Type: 2001,MIC-CLEAR Originator-Name: webmaster@www.sec.gov Originator-Key-Asymmetric: MFgwCgYEVQgBAQICAf8DSgAwRwJAW2sNKK9AVtBzYZmr6aGjlWyK3XmZv3dTINen TWSM7vrzLADbmYQaionwg5sDW3P6oaM5D3tdezXMm7z1T+B+twIDAQAB MIC-Info: RSA-MD5,RSA, GjN5rCkTNpWzx8OV/yS89Gitnn4jCFrgdNBsMm17GrlDVAkmoMdTUKp586Xaew86 +rJJxO7s2GKklPZpa+zFkg== 0000750686-96-000004.txt : 19960702 0000750686-96-000004.hdr.sgml : 19960702 ACCESSION NUMBER: 0000750686-96-000004 CONFORMED SUBMISSION TYPE: 10-Q PUBLIC DOCUMENT COUNT: 1 CONFORMED PERIOD OF REPORT: 19960331 FILED AS OF DATE: 19960514 SROS: NONE FILER: COMPANY DATA: COMPANY CONFORMED NAME: CAMDEN NATIONAL CORP CENTRAL INDEX KEY: 0000750686 STANDARD INDUSTRIAL CLASSIFICATION: 6021 IRS NUMBER: 010413282 STATE OF INCORPORATION: ME FISCAL YEAR END: 1231 FILING VALUES: FORM TYPE: 10-Q SEC ACT: 1934 Act SEC FILE NUMBER: 000-28190 FILM NUMBER: 96562231 BUSINESS ADDRESS: STREET 1: TWO ELM ST CITY: CAMDEN STATE: ME ZIP: 04843 BUSINESS PHONE: 2072368821 MAIL ADDRESS: STREET 1: 2 ELM ST CITY: CAMDEN STATE: ME ZIP: 04843 10-Q 1 UNITED STATES SECURITIES AND EXCHANGE COMMISSION Washington, D.C. 20549 FORM 10-Q QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 For the quarter ended March 31, 1996. Commission File No. 0-28190 CAMDEN NATIONAL CORPORATION (Exact name of registrant as specified in its charter) MAINE 01-04132282 (State or other jurisdiction (I.R.S. Employer incorporation or organization) Identification No.) 2 ELM STREET, CAMDEN, ME 04843 (Address of principal executive offices) (Zip Code) Registrants's telephone number, including area code: (207) 236-8821 Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter periods that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes [X] No [ ] Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practical date: Outstanding at March 31, 1996: Common stock (no par value) 2,340,924 shares CAMDEN NATIONAL CORPORATION Form 10-Q for the quarter ended March 31, 1996 TABLE OF CONTENTS OF INFORMATION REQUIRED IN REPORT PART I. ITEM 1. FINANCIAL INFORMATION PAGE Consolidated Statements of Income Three Months Ended March 31, 1996 and 1995 3 Consolidated Statements of Conditions March 31, 1996 and 1995 and December 31, 1995 4 Consolidated Statements of Changes in Stockholders' Equity Three Months Ended March 31, 1996 and 1995 5 Consolidated Statements of Cash Flows Three Months Ended March 31, 1996 and 1995 6 Analysis of Change in Net Interest Margin on Earning Assets Three Months Ended March 31, 1996 and 1995 7 Anaysis of Volume and Rate Changes on Net Interest Income & Expenses March 31, 1996 over March 31, 1995 8 ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS 9-11 PART II. ITEM 6. Exhibits and Reports on Form 8-K 12 SIGNATURES 13 EXHIBITS 14-20 PART I. ITEM I. FINANCIAL INFORMATION Camden National Corporation and Subsidiaries Consolidated Statements of Income (Unaudited) (In Thousands, except number of shares and per share data)
Quarter Ended March 31, 1996 1995 Interest Income Interest and fees on loans $ 7,016 $ 6,424 Interest on U.S. Government and agency obligations 2,168 2,281 Interest on state and political subdivisions 83 101 Interest on interest rate swap agreements 313 385 Interest on federal funds sold and other investments 141 112 ------- ------- Total interest income 9,721 9,303 Interest Expense Interest on deposits 3,624 2,938 Interest on interest rate swap agreements 286 383 Interest on other borrowings 799 1,094 ------- ------- Total interest expense 4,709 4,415 ------- ------- Net interest income 5,012 4,888 Provision for Loan Losses 217 186 ------- ------- Net interest income after provision for loan losses 4,795 4,702 Other Income Service charges on deposit accounts 243 262 Other service charges and fees 252 216 Other 165 172 ------- ------- Total other income 660 650 Operating Expenses Salaries and employee benefits 1,540 1,411 Premises and fixed assets 504 465 Other operating expenses 800 949 ------- ------- Total operating expenses 2,844 2,825 Less minority interest in net income (loss) (16) (14) ------- ------- Income before income taxes 2,627 2,541 Income Taxes 869 708 ------- ------- Net Income $ 1,758 $ 1,833 ======= ======= Per Share Data Earnings per share .75 .78 (Net income divided by weighted average shares outstanding) Cash dividends per share .18 .14 Weighted average number of shares outstanding 2,342,585 2,348,820
Camden National Corporation and Subsidiaries Consolidated Statements of Condition (Unaudited) (In Thousands, except number of shares and per share data)
March 31, March 31, December 31, 1996 1995 1995 Assets Cash and due from banks $ 12,789 $ 10,844 $ 16,356 Federal funds sold 1,150 0 1,700 Investment securities: Available for sale 26,694 9,636 26,196 Held to maturity 128,011 148,529 135,136 Residential mortgages held for sale 2,465 869 2,083 Loans 286,488 275,626 283,019 Less allowance for loan losses (4,203) (3,836) (4,080) --------- ------- -------- Net loans 282,285 271,790 278,939 Bank premises and equipment 8,487 7,746 8,495 Other real estate owned 1,279 1,606 1,086 Interest receivable 3,339 3,725 4,252 Other assets 6,313 6,898 6,442 --------- --------- --------- Total assets $472,812 $461,643 $480,685 ========= ========= ========= Liabilities Demand deposits $ 36,865 $ 35,572 $ 46,034 NOW deposits 37,811 32,287 42,192 Money market deposits 25,210 31,498 27,066 Savings deposits 63,447 69,823 63,503 Broker deposits 6,215 0 9,108 Certificates of deposit under $100,000 160,684 129,799 159,310 Certificates of deposit $100,000 and over 23,658 27,519 22,667 --------- --------- --------- Total deposits 353,890 326,498 369,880 Borrowings from Federal Home Loan Bank 45,209 59,667 39,387 Other borrowed funds 13,323 21,632 12,593 Accrued interest and other liabilities 5,512 4,541 5,056 Minority interest in subsidiary 74 90 89 --------- --------- --------- Total liabilities 418,008 412,428 427,005 Commitments Stockholders' Equity Common stock, no par value; (authorized 18,000,000, issued 2,376,082) 2,436 2,440 2,436 Surplus 1,226 1,233 1,226 Net unrealized appreciation on securities available for sale 31 153 104 Retained earnings 52,286 46,428 50,951 -------- -------- -------- 55,979 50,254 54,717 Less cost of 35,158, 31,843 and 31,521 shares of treasury stock on March 31, 1996 and 1995, and December 31, 1995 1,175 1,039 1,037 -------- ------- ------- Total stockholders' equity 54,804 49,215 53,680 Total liabilities and stockholders' equity $472,812 $461,643 $480,685 ======== ======== ========
Camden National Corporation and Subsidiaries Consolidated Statements of Changes in Stockholders' Equity Quarters Ended March 31, 1995 and 1996 (Unaudited) (In Thousands, except number of shares and per share data)
Net Unrealized Appreciation on Securities Common Retained Available Treas Total Stock Surplus Earnings For Sale Stock Equity Balance at 12/31/94 $2,440 $1,208 $44,922 $ 137 $ (445) $48,262 Net income for 1993 - - 1,833 - - 1,833 Change in unrealized gains (losses) on securities available for sale, net of tax benefit of $8,000 - - - 16 - 16 Purchase of treasury stock (24,741 shares) - - - - (929) (929) Sale of treasury stock (20,200 shares) - 25 - - 335 360 Cash dividends - - (327) - - (327) ------ ------ ------- ------ ------- ------- Balance at 3/31/95 $2,440 $1,233 $46,428 $ 153 $(1,039) $49,215 ====== ====== ======= ====== ======= ======= Balance at 12/31/95 2,436 1,226 50,951 104 (1,037) 53,680 Net income for 1995 - - 1,757 - - 1,757 Change in unrealized gains (losses) on securities available for sale, net of tax benefit of $37,000 - - - (73) - (73) Purchase of treasury stock (4,295 shares) - - - - (163) (163) Sale of treasury stock (658 shares) - - - - 25 25 Cash dividends - - (422) - - (422) ------ ------ ------- ------ ------- ------- Balance at 3/31/96 $2,436 $1,226 $52,286 $ 31 $(1,175) $54,804 ====== ====== ======= ====== ======= =======
Camden National Corporation and Subsidiaries Consolidated Statements of Cash Flows (Unaudited)
(In Thousands, except number of Quarter Ended March 31, shares and per share data) 1996 1995 Operating Activities Net Income $ 1,758 $ 1,833 Adjustments to reconcile net income to net cash provided by operating activities: Provision for loan losses 217 186 Depreciation and amortization 236 202 Decrease in interest receivable 913 628 Decrease (increase) in other assets 129 (2,052) Decrease in accrued interest (773) (524) Increase in other liabilities 1,229 517 Cash receipts from sale of residential loans 559 1,300 Origination of mortgage loans held for sale (941) (278) Other, net - 6 ------- ------- Net cash provided by operating activities 3,327 1,818 Investing Activities Proceeds from maturities and calls of securities held to maturity 12,856 2,574 Purchase of securities to be held to maturity (5,737) (76) Purchase of securities available for sale (566) (2,215) Increase in loans (3,563) (12,177) Net (increase) decrease in other real estate (193) 0 Purchase of premises and equipment (228) (400) Increase in minority position (15) (27) Net purchase of federal funds 550 0 ------- ------- Net cash used by investing activities 3,104 (12,321) Financing Activities Net decrease in demand deposits, NOW accounts, and savings accounts (15,462) (19,466) Net (decrease) increase in certificates of deposit (528) 5,720 Net increase in short-term borrowings 6,552 18,855 Acquisition of treasury stock (163) (929) Sale of treasury stock 25 335 Cash dividends (422) (327) ------- ------- Net cash provided by financing activities (9,998) 4,188 ------- ------- Decrease in cash and cash equivalents (3,567) (6,315) Cash and cash equivalents at beginning of year 16,356 17,159 ------- ------- Cash and cash equivalents at end of quarter $12,789 $10,844 ======= =======
ANALYSIS OF CHANGE IN NET INTEREST MARGIN ON EARNING ASSETS
Three Months Ending Three Months Ending March 31, 1996 March 31, 1995 ---------------------- ---------------------- Average Yield/ Average Yield/ Balance Int. Rate Balance Int. Rate ------- ----- ------ ------- ----- ------ ASSETS Securities-Taxable 147,451 2,288 6.21% 147,503 2,393 6.49% Securities-Nontaxable 7,891 125 6.34% 10,979 153 5.57% Federal Funds Sold 1,648 21 5.10% 0 0 0.00% Loans 287,980 7,043* 9.78% 271,633 6,426* 9.46% ------- ----- ----- ------- ----- ----- Total Earning Assets 444,970 9,477 8.52% 430,115 8,972 8.34% Cash and Due from Banks 12,733 11,822 Other Assets 19,919 17,707 Less Allowance for Loan Losses (4,225) (3,790) ------- ------- Total Assets 473,397 455,854 ======= ======= LIABILITIES & SHAREHOLDERS' EQUITY NOW Accounts 38,299 138 1.44% 39,279 166 1.69% Savings Accounts 63,153 531 3.36% 64,400 550 3.42% Money Market Accounts 26,143 204 3.12% 36,462 298 3.27% Certificates of Deposit 183,411 2,644 5.77% 153,583 1,924 5.01% Short-term Borrowings 56,018 799 5.71% 71,271 1,094 6.14% Broker Certificates of Deposit 7,119 107 6.01% ------- ----- ----- ------- ----- ----- Total Interest-bearing Liabilities 374,143 4,423 4.73% 364,995 4,032 4.42% Demand Deposits 39,619 37,465 Other Liabilities 5,744 3,294 Shareholders' Equity 53,891 50,100 ------- ------- Total Liabilities & Shareholders' Equity 473,397 455,854 ======= ======= Net Interest Income 5,054 4,940 (fully-taxable equivalent) Less: fully-taxable equivalent adjustment (42) (52) ----- ----- 5,012 4,888 ===== ===== Net Interest Rate Spread (fully-taxable equivalent) 3.79% 3.92% Net Interest Margin (fully-taxable equivalent) 4.54% 4.59% *Includes net swap income figures (in thousands) - March 1996 $27 and March 1995 $3. Notes: Nonaccrual loans are included in total average loans. Tax exempt interest was calculated using a rate of 34% for fully-taxable equivalent.
ANALYSIS OF VOLUME AND RATE CHANGE ON NET INTEREST INCOME AND EXPENSES
March 1996 Over March 1995 ----------------------------- Change Change due to due to Total Volume Rate Change ------ ------ ------ INTEREST-EARNING ASSETS: Securities-taxable (1) (104) (105) Securities-nontaxable (43) 15 (28) Federal Funds Sold 21 0 21 Loans 387 230 617 ---- ---- ---- Total Interest Income 364 141 505 INTEREST-BEARING LIABILITIES: NOW Accounts (4) (24) (28) Savings Accounts (11) (8) (19) Money Market Accounts (84) (10) (94) Certificates of Deposit 374 346 720 Short-term Borrowings (234) (61) (295) Broker Certificates 107 0 107 ---- ---- ---- Total Interest Expense 148 243 391 Net Interest Income 216 (102) 114 (fully taxable equivalent)
ITEM II. MANAGEMENT'S DISCUSSION OF FINANCIAL CONDITION AND RESULTS OF OPERATIONS FINANCIAL CONDITION At March 31, 1996, the Company had consolidated asset of $472.8 million, a decrease of $7.8 million or 1.6%, from December 31, 1995. The change in assets consisted primarily of a $6.6 million decrease in the investment portfolio. There were maturities and called securities during the first quarter of 1996 that were not replaced due to the low rate environment. Management used the funds to pay off borrowings until more favorable investment alternatives became available. In reviewing the balance sheet on March 31, 1996 as compared to March 31, 1995, the major change in assets was the growth in the loan portfolio by $10.8 million for the twelve month period. The liquidity needs of the Company's financial institution subsidiaries require the availability of cash to meet the withdrawal demands of depositors and the credit commitments to borrowers. Due to the potential for unexpected fluctuation in both these areas -- deposits and loans -- active management of the Company's liquidity is critical. As of March 31, 1996 the Company's level of liquidity exceeded its target level. Deposits still represent the Company's primary source of funds. During the past twelve months deposits have increased by $27.3 million. The largest growth was in the certificates of deposit accounts that increased $27.0 million or 17.2%. Since December 31, 1995 deposit have declined by $15.9 million or 4.5%, most of which has been in DDA and NOW accounts. These declines are the result of seasonal reductions that the Company normally experiences during the first quarter each year. Borrowings also provide liquidity in the form of federal funds purchased, securities sold under agreements to repurchase, treasury tax and loan accounts, and borrowings from the Federal Home Loan Bank. Total borrowings decreased during the past twelve months by $22 million or 28%. As loan demand increases and investment opportunities come available in the coming months, management anticipates that borrowing will increase to meet those funding needs. Normally loan growth in stronger during the first half of the year due to the seasonal business of many of our commercial loan customers. In determining the adequacy of the loan loss allowance, management relies primarily on its review of the loan portfolio both to ascertain whether there are probable losses to be written off, and to assess the loan portfolio in the aggregate. Nonperforming loans are examined on an individual basis to determine estimated probable loss. In addition, management considers current and projected loan mix and loan volumes, historical net loan loss experience for each loan category, and current and anticipated economic conditions affecting each loan category. No assurance can be given, however, that adverse economic conditions or other circumstances will not result in increased losses in the portfolio. The Company continues to monitor and modify its allowance for loan losses as conditions dictate. During the first quarter of 1996, $217,000 was added to the reserve for loan losses, resulting in an allowance of $4.2 million, or 1.47%, of total loans outstanding. Management believes that this allowance is appropriate given the current economic conditions in the Company's service area and the overall condition of the loan portfolio. Under Federal Reserve Board (FRB) guidelines, bank holding companies such as the Company are required to maintain capital based on "risk- adjusted" assets. These guidelines apply to the Company on a consolidated basis. Under the current guidelines, banking organizations must maintain a risk-based capital ratio of eight percent, of which at least four percent must be in the form of core capital. The Company's ratios at March 31, 1996, of 20.74% and 19.49% respectively, exceed regulatory guidelines. The principal cash requirement of the Company is the payment of dividends on common stock when declared. The Company is primarily dependent upon the payment of cash dividends by Camden National Bank to service its commitments. During the first quarter of 1996 Camden National Bank paid a dividend to the Company in the amount of $585,235. The Company paid dividends to shareholders in the amount of $422,025 and $163,210 was used for treasury stock transactions by the Company. RESULTS OPERATION Net income for the three months ended March 31, 1996 was $1,758,000, a decrease of $75,000 or 4.3% below first quarter 1995's net income of $1,833,000. In the first three months of 1995 the Company had a tax benefit of $134,000, due to stock options that were exercised. If the Company had not had the tax benefit in 1995, this year's first quarter earnings would have exceeded those of last year's. NET INTEREST INCOME Net interest income for the three months ended March 31, 1996 was $5,012,000, a 2.5% or $124,000 increase over first quarter 1995's net interest income of $4,888,000. Contributing to this increase was the fact that total interest income was $418,000 or 4.5% higher in the first three months of 1996 compared to the same period 1995. Interest income on loans increased by $617,000, of which $387,000 was due to an increase in volume and $230,000 was due to an increase in the average yield from 9.46% in the first three months of 1995 to 9.78% in 1996. The Company did, however, experience a decrease in interest income on investments during the first quarter of 1996 compared to the same period in 1995 due to a reduction in yields from 6.49% to 6.21%. As investments matured they were replaced with lower yielding instruments, due to the current rate structure. The Company's interest expense of $4,709,000 is a 6.7% or $294,000 increase over first quarter 1995's total interest expense of $4,414,000. The largest contributor to this increase in interest expense was interest paid on certificates of deposit, which increased by $720,000 due to increases in both volume and rates. During 1995 the Company had increased rates offered on certificates of deposit to stimulate deposit growth and meet funding needs. The Company did, however, experience a decrease of interest expense on borrowed funds in the first quarter of 1996 compared to the first quarter of 1995 of $295,000 due to both volume and rate declines. The Analysis of Change in Net Interest Margin on Earning Assets, and the Analysis of Volume and Rate Changes on Net Interest Income and Expenses are provided on pages 7 and 8 of this report to enable the reader to understand the components of the Company's interest income and expenses. The first table provides an analysis of changes in net interest margin on earning assets setting forth average assets, liabilities and stockholders' equity; interest income earned and interest expense paid and average rates earned and paid; and the net interest margin on earning assets for the three months ended March 31, 1996 and 1995. The second of these tables presents an analysis of volume and rate change on net interest income and expense from March 31, 1995 to March 31, 1996. The Company utilizes off-balance sheet instruments such as interest rate swap agreements that have an effect on net interest income. The net results were increases in net interest income by $27,000 and $2,000 in the first three months of 1996 and 1995, respectively. NONINTEREST INCOME There was a $10,000 or 1.5% increase in total noninterest income in the first quarter of 1996 compared to the first quarter of 1995. There was a decline in service charges on deposit accounts of $19,000, due to a change in the fee structure in the second quarter of 1995. Other fees, however, increased by $36,000, the result of increases in a number of income categories. The largest increase was in new fees collected for loan document preparation. There was a slight decrease in other income due to a number of small variances in a number of income categories. NONINTEREST EXPENSE There was a $19,000 or .6% increase in total noninterest expense in the first quarter of 1996 compared to the first quarter of 1995. Salaries and employee benefit cost increased $129,000 or 9.1% in the first quarter of 1996 compared to 1995. This increase was the result of normal annual increases, combined with higher pension benefit costs. The higher pension costs were due to the addition of employees at United Bank and a decrease in the discount rate. The Company also experienced an increase in fixed asset costs due to the depreciation of several large pieces of computer equipment that were purchased in the middle of 1995. These purchases were necessary to take advantage of new technologies that will provide new services and enhance customer satisfaction and, in the long term, assist in containing overhead costs. Lastly, there was a reduction in other operating expenses of $149,000 or 15.7% in the first quarter of 1996 compared to the first quarter of 1995. This reduction was due to the temporary decrease of the FDIC assessment by $170,000 in the first quarter of 1996 compared to the same period in 1995. RECENT ACCOUNTING PRONOUNCEMENTS SFAS 122, "Accounting for Mortgage Servicing Rights" was issued in May of 1995. Where mortgage loans are sold or securitized but the rights to service those loans are retained by the creditor, the standard requires that the total cost of such loans (whether originated or acquired) be allocated between the mortgage servicing rights and the loans themselves based on their relative fair values. SFAS 122 also addresses measurement of impairment of capitalized mortgage servicing rights. The Company has adopted SFAS 122 as of January 1, 1996. During the first quarter of 1996 activity in this area was minimal and had no material effect on the financial position and results of operations. PART II ITEM 6. Exhibits and Reports on Form 8-K (a). Exhibits (3.i) The Articles of Incorporation of Camden National Corporation, as amended to date. (3.ii) The Bylaws of Camden National Corporation, as amended to date, Exhibit 3.ii to the Company's Registration Statement on Form S-4 filed with the Commission on September 25, 1995, file number 33-97340, are incorporatied herein by reference. SIGNATURES Pursuant to the requirements of the Securities Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized. CAMDEN NATIONAL CORPORATION (Registrant) Keith C. Patten 05/13/96 Keith C. Patten President and CEO Susan M. Westfall 05/13/96 Susan M. Westfall Treasurer and Chief Financial Officer EXHIBITS (a). Exhibits (3.i) The Articles of Incorporation of Camden National Corporation, as amended to date. (3.ii) The Bylaws of Camden National Corporation, as amended to date, Exhibit 3.ii to the Company's Registration Statement on Form S-4 filed with the Commission on September 25, 1995, file number 33-97340, are incorporatied herein by reference. _______________________________________________________________________ CAMDEN NATIONAL CORPORATION Report of Incorporator's Action The following person acted as Incorporator: Rendle A. Jones Pursuant to authorization granted to incorporators under the Maine Business Corporation Act, the Incorporator took the following action: The name of the corporation shall be: Camden National Corporation The purpose of the corporation shall be all those purposes permitted corporations organized under the Maine Business Corporation Act. The name of the Clerk, who is a Maine resident, and the address of the Corporation's Registered Office shall be: Robert Worthing 2 Elm Street Camden, Maine 04843 The number of Directors constituting the initial Board of Directors of the Corporation shall be thirteen (13). The initial Directors, who shall serve until the first annual meeting of the shareholders, or until their successors are elected and qualified, and their addresses, are set forth in Exhibit A. The initial Bylaws of the Corporation are set forth in Exhibit B. There shall be only one class of shares; viz. common, which shall have no par value. There shall be authorized 150,000 shares. There shall be no preemptive rights. Meetings of the shareholders may be held outside the State of Maine. The foregoing action was adopted by the sole Incorporator on the dated set forth below. Camden, Maine Rendle A. Jones (signature) March 20, 1984 Incorporator _________________________________________________________________________ Filing Fee $50.00 plus fee based on authorized capital stock For Use By The Secretary of State For Use By The Secretary of State File No. _84153OD_ FILED Fee Paid _$150 - $50_ _March 21, 1984_ C.B. __--__ Xxxxxxxx Xxxxxxxxx (signature) Date __4-10-84__ Deputy Secretary of State A True Copy When Attested By Signature L. Evelin Grover (signature) Deputy Secretary of State STATE OF MAINE ARTICLES OF INCORPORATION OF Camden National Corporation (insert corporate name) Pursuant to 13A MRSA Section 403, the undersigned, acting as incorporator(s) of a corporation, adopt(s) the following Articles of Incorporation: FIRST: The name of the corporation is Camden National Corporation and it is located in Maine, at 2 Elm Street, Camden, ME 04843 SECOND: The name of its Clerk, who must be a Maine resident, and the address of its registered office shall be: Name Robert Worthing Street & Number 2 Elm Street City Camden, Maine 04843 THIRD: ("X" one box only) _X_ a. The number of directors constituting the initial board of directors of the corporation is 13 (See Section 703,1.A.) b. If the initial directors have been selected, the names and addresses of the persons who are to serve as directors until the first annual meeting of the shareholders or until their successors are elected and shall qualify are: Name Address David H. Montgomery c/o Allen Agency Main St, Camden, ME 04843 Kenneth C. Dickey c/o Haskell & Corthell 10 Main St, Camden, ME 04843 William S. Brawn c/o French & Brawn 1 Elm St, Camden, ME 04843 C.R. deRochemont 106 Pleasant St Rockland, ME 04841 E. Maynard Graffam, Jr. c/o Penobscot Bay Ice Co., Inc. Rockport, ME 04856 Frederick G. Hanley Camden National Bank 2 Elm St, Camden, ME 04843 Gilbert Harmon, Esq. Harmon, Jones & Sanford 20 Mechanic St, Camden ME 04843 Robert Heald Union Wood Products Union, ME 04862 Lawrence N. Hopkins 66 Washington St. Camden, ME 04843 John S. McCormick, Jr. Box 162 West Rockport, ME 04865 Keith C. Patten Camden National Bank 2 Elm St, Camden, ME 04843 Richard N. Simoneau 8 North Main St Rockland, ME 04841 Arthur E. Strout, Esq. 10 Masonic St Rockland, ME 04841 ___ There shall be no directors initially; the shares of the corporation will not be sold to more than twenty (20) persons; the business of the corporation will be managed by the shareholders. (See section 703,1.B.) FOURTH: ("X" one box only) The board of directors is _X_ is not __ authorized to increase or decrease the number of directors. If the board is so authorized, the minimum number, if any, shall be seven (7) directors, (See section 703,A.A.) and the maximum number, if any, shall be sixteen (16) directors. FIFTH: ("X" one box only) _X_ There shall be only one class of shares, viz, common. Par value of each share (if none, so state) none. Number of shares authorized 150,000. ___ There shall be two or more classes of shares. The information required by Section 403 concerning each such class is set out in Exhibit___________ attached hereto and made a part hereof. SUMMARY The aggregate par value of all authorized shares (of all classes) having a par value is $ none. The total number of authorized shares (of all classes) without par value is 150,000 shares. SIXTH: ("X" one box only) Meetings of the shareholders may _X_ may not ___ be held outside the State of Maine. SEVENTH: ("X" if applicable) There are no preemptive rights. _X_ EIGHTH: Other provisions of these articles, if any, including provisions of the internal affairs of the corporation, are set out in Exhibit _n/a_ attached hereto and made a part hereof. DATED: March 20, 1984 INCORPORATORS RESIDENCE ADDRESSES Rendle A. Jones (signature) Box 189 Rendle A. Jones (printed name) Camden ,Maine 04843 ________________________________________________________________________ For Use By The Secretary of State For Use By The Secretary of State No. _84153OD_ FILED Fee Paid _$250 - $10_ _September 10, 1984_ C.B. _271_ Xxxxxxxxx Xxxxxxx (signature) Date _10-12-84_ Deputy Secretary of State A True Copy When Attested By Signature L. Evelin Grover (signature) Deputy Secretary of State STATE OF MAINE ARTICLES OF AMENDMENT (Amendment by Incorporator) Pursuant to 13-A KRSA Section 803, the undersigned corporation adopts these Articles of Amendment. FIRST: The organizational meeting of the Board of Directors required by Section 407 has not yet occurred. SECOND: The amendments set out in Exhibit A attached were adopted by the sole Incorporator, by unanimous written consent on July 18, 1984. THIRD: The number of shares that the Corporation has authority to issue hereafter is as follows: Class Series (if any) No. of shares Par value (if any) common none 600,000 none The aggregate par value of all such shares (of all classes and series) having par value is none. The total number of all such shares (of all classes and series) without par value is 600,000 shares. FOURTH: The address of the registered office in Maine: 2 Elm Street Camden, Maine 04843 Dated: August 30, 1984 Camden National Corporation by: Robert E. Worthing (signature) Robert E. Worthing, Clerk _________________________________________________________________________ CAMDEN NATIONAL CORPORATION Report of Incorporator Action Pursuant to authorization granted to incorporators under the Maine Business Corporation Act, the Incorporator took the following action: The Articles of Incorporation of Camden National Corporation shall be amended as set forth in Exhibit A attached to this report. The Clerk of the Corporation shall file Articles of Amendment reflecting the changes set forth in Exhibit A. The foregoing represents the action of the sole incorporator of the Corporation adopted by consent. Camden, Maine July 18, 1984 Rendle A. Jones (signature) Incorporator ________________________________________________________________________ EXHIBIT A 1. The number of authorized shares of common stock with no par value shall be increased from 150,000 shares to 600,000 shares. 2. The Directors of the Corporation shall be divided into three classes and one-third of the Directors, or as near as one-third as possible, shall be assigned to each class. The initial Board of Directors shall consist of thirteen persons and Class A and Class B shall each consist of four Directors while Class C shall consist of five Directors. At the first annual meeting of Shareholders, Directors of all three classes shall be elected with the term of office of the Class A Directors expiring at the first annual meeting of Shareholders after their election, that of the Class B Directors expiring at the second annual meeting after their election and that of the Class C Directors expiring at the third annual meeting after their election. Thereafter, as the term of office of the Class of Directors expires, the Directors of that Class shall be elected for a three- year term. 3. When any vacancy occurs in the Board of Directors, including those created by an increase in the number of Directors, the remaining members of the Board may appoint a Director to fill such vacancy at any regular or special meeting of the Board. 4. Cumulative voting shall not be employed in voting for Directors or for any other purpose. 5. Bylaws may be amended, altered, or appealed at any regular meeting of the Board of Directors or Shareholders by a two- thirds vote of the Shareholders after notice of such intended action as required by law. 6. The Board of Directors, when evaluating any offer of another party to (a) make a tender or exchange offer for the equity securities of the corporation or any subsidiary, (b) merge or consolidate the corporation or any subsidiary with another corporation, or (c) purchase or otherwise acquire all or substantially all of the properties and assets of the corporation, or any subsidiary, shall, in connection with the exercise of its judgment in determining what is in the best interests of the corporation and its stockholders, give due consideration to all relevant factors, including by way of illustration, but not of limitation, any of the following: 6.1 Whether the offer is acceptable based on historical operating results, the financial condition of the corporation and its subsidiaries, and its future prospects; 6.2 Whether a more favorable offer could be obtained for the securities or assets of the corporation or its subsidiary in the foreseeable future; 6.3 The social, economic or other material impact which an acquisition of the equity securities of the corporation or substantially all of its assets would have upon the employees and customers of the corporation and its subsidiaries and the communities which they serve; 6.4 The reputation and business practices of the offeror and its management and affiliates as they would affect the employees and customers of the corporation and its subsidiaries and the future value of the corporation stock; 6.5 The value of the securities, if any, which the offeror is offering in exchanges for the corporation's or its subsidiaries' securities or assets based on an analysis of the worth of the corporation or of its subsidiaries as compared to the offeror corporation or other entity whose securities are being offered; and 6.6 Any anti-trust or other legal or regulatory issues that are raised by the offer. 7. If the Board of Directors determines that an offer of the type identified in paragraph 6 should be rejected, it may take any lawful action to accomplish its purpose including, but not limited to, any of the following: 7.1 Advising shareholders not to accept the offer. 7.2 Litigation against the offeror. 7.3 Filing complaints with any governmental and regulatory authorities. 7.4 Acquiring the corporation's securities. 7.5 Selling or otherwise issuing authorized but unissued securities of treasury stock or granting options with respect thereto. 7.6 Acquiring a company to create an anti-trust or other regulatory problem for the offeror. 7.7 Obtaining a more favorable offer from another individual or entity. 8. The provisions of paragraph 6 and 7 and this paragraph 8 may be amended only by the affirmative vote of two-thirds of the outstanding shares of common stock of the corporation and by the affirmative vote of two-thirds of the outstanding shares of preferred stock of the corporation, if any. ________________________________________________________________________ STATE OF MAINE ARTICLES OF AMENDMENT (Amendment by Shareholders Voting as One Class) Pursuant to 13-A MRSA Sections 805 and 807, the undersigned corporation adopts these Articles of Amendment: FIRST: All outstanding shares were entitled to vote on the following amendment as ONE class. SECOND: The amendment set out in Exhibit A attached was adopted by the shareholders (select one) _A._ at a meeting legally called and held on July 27, 1993. B. by unanimous written consent on THIRD: Shares outstanding and entitled to vote and shares voted for and against said amendment were: Number of Shares Outstanding Number Number and Entitled to Vote Voted For Voted Against 72,574 59,510 30 FOURTH: If such amendment provides for exchange, reclassification or cancellation of issued shares, the manner in which this shall be effected is contained in Exhibit B attached if it is not set forth in the amendment itself. FIFTH: (Complete if Exhibits do not give this information.) If the amendment changes the number of par values of authorized shares, the number of shares the corporation has authority to issue thereafter, is as follows: Class Series (If any) Number of Shares Par Value (ifany) Common n/a 2,500,000 no par value SIXTH: Address of the registered office in Maine: 2 Elm Street P.O. Box 310 Camden, ME 04843 MUST BE COMPLETED FOR VOTE Camden National Corporation OF SHAREHOLDERS (Name of Corporation) I certify that I have custody By R. E. Worthing (signature) of the minutes showing the Robert E. Worthing, Clerk above action by the shareholders. R. E. Worthing (signature) Dated: 9/27/93 -----END PRIVACY-ENHANCED MESSAGE-----