SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d)
OF THE SECURITIES EXCHANGE ACT OF 1934
June 14, 2002
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(Date of earliest event reported)
Ipswich Bancshares, Inc.
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(Exact name of registrant as specified in its charter)
Massachusetts 0-26663 04-3459169
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(State or other jurisdiction (Commission File Number) (IRS Employer
of incorporation) Identification No.)
23 Market Street, Ipswich, Massachusetts 01938
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(Address of principal executive offices) (Zip Code)
(978) 356-7777
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(Registrant's telephone number, including area code)
Not Applicable
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(Former name, former address and former fiscal year,
if changed since last report)
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Item 5. Other Events
Ipswich Bancshares, Inc. ("Ipswich"), the holding company for Ipswich
Savings Bank (the "Bank") and its subsidiary Ipswich Preferred Capital
Corporation ("IPCC"), a real estate investment trust which is 99% owned by the
Bank, reported that the Bank has received from the Commonwealth of Massachusetts
Department of Revenue (the "Department") a notice of intent (the "Notice") to
assess additional state excise taxes of $538,775.00 plus interest. As of the
date of the Notice, interest totaled $67,952.13. The assessment is based upon a
review of the financial institution excise return filed by the Bank for its tax
year ended October 31, 2000.
The Department contends that dividend distributions by IPCC to the Bank are
fully taxable in Massachusetts. Ipswich believes that the Massachusetts statute
that provides for a dividends received deduction equal to 95% of certain
dividend distributions applies to the distributions made by IPCC to the Bank.
Accordingly, no provision has been made in Ipswich's financial statements for
the amounts assessed or additional amounts that might be assessed in the future.
Ipswich intends to vigorously appeal the assessment and to pursue all available
means to defend its position.
Ipswich is aware that other financial institutions in Massachusetts have
real estate investment trust subsidiaries that operate in a manner similar to
IPCC and that they too have recently received notices of intent from the
Department to assess additional state excise taxes.
In connection with Ipswich's pending acquisition by Banknorth Group, Inc.
("Banknorth"), Banknorth has advised Ipswich that the Bank's receipt of the
Notice does not affect Banknorth's intention to proceed with its pending
acquisition of Ipswich.
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SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized.
IPSWICH BANCSHARES, INC.
By: /s/ Francis Kenney
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Name: Francis Kenney
Title: Treasurer and Chief
Financial Officer
Date: June 14, 2002
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