V.R. DeAngelis M.D.P.C. & R.T. Domingo M.D.P.C., V. R. DeAngelis M.D.P.C., Tax Matters Partner, et al. - Page 16

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          an actual claim for benefits, Mr. Pagano and the STEP plan                  
          administrator relied upon the documents submitted to them by the            
          claimant and did not perform an independent investigation or                
          verification of the claim.  If a participant’s claim for benefits           
          as submitted did not qualify for benefits under the STEP plan,              
          the STEP plan allowed the participant to reform his or her claim            
          in order to receive his or her anticipated benefits.                        
               F.  Version 4 of the STEP Plan9                                        
               Section 1.11, 1.13, and 1.14 of the STEP plan defines the              
          terms “Covered Employee”, “Eligible Employee”, and “Employee”.              
          Section 2.1(c) states that “The Employer shall transmit to the              
          Plan Administrator written notice of any substantial or unusual             
          change in a Covered Employee’s Compensation or status (e.g., from           
          fulltime to parttime) as it occurs, but in any event no later               
          than 30 days after the change occurs”.  Section 3.1 states that             
          “A Covered Employee’s Severance Benefit shall be determined in              
          accordance with the Severance Benefit formula elected in the                
          Adoption Agreement.  In no event, however, may a Covered                    
          Employee’s Severance Benefit exceed two times his Compensation              
          paid during the twelve full-month period immediately preceding              
          his Termination of Employment”.                                             

               9 In our findings of fact set forth under this subheading,             
          section references are to version 4 of the STEP plan.                       

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Last modified: March 27, 2008