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the Roarks that this charitable split-dollar arrangement would be
a good fit for them since it would further their philanthropic
goals, as well as helping to provide for Mr. Roark’s family after
he died. The Roarks agreed, and Pippenger began putting the deal
in place in April 1998.
On April 13, 1998, Mr. Roark took the first step by opening
a donor-advised account with NCF, to be called the David C. Roark
Foundation. In keeping with NCF’s practice, Mr. Roark was
allowed to choose which charity would get 75 percent of the
distribution from his Foundation, and he picked the North
Chattanooga Gideons Camp. The Roarks then created the David
Roark Revocable Life Insurance Trust on April 16, 1998. Mr.
Roark, and Mrs. Roark in her capacity as trustee, applied to IDS
Life for a $2.2 million insurance policy on Mr. Roark’s life,
naming the Trust as beneficiary. Mr. Roark was both the grantor
of the Trust and its beneficiary during his lifetime. Mrs. Roark
was the Trust’s beneficiary if she survived her husband; the
remainder beneficiaries were the Roarks’ children.
Mrs. Roark, as trustee of the Trust, sent a letter to Curtis
Calihan, NCF’s Executive Director. The letter offered NCF an
option to buy a term insurance death benefit in the insurance
policy through the Roark Foundation. NCF’s chief counsel, Mark
Absher, testified that NCF applied stringent criteria to the life
insurance investments it was offered--NCF insisted on a
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