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 22

                                       - 22 -                                         
          VI.  VRD/RTD’s Adoption of the STEP Plan                                    
               A.  Execution of Adoption Agreement                                    
               On or about December 20, 1993, Dr. DeAngelis executed an               
          adoption agreement for the STEP plan on behalf of VRD/RTD, making           
          VRD/RTD a participating employer in the STEP plan effective as of           
          January 1, 1993.  VRD/RTD consented in the agreement to any                 
          future amendment of the STEP plan.                                          
               VRD/RTD elected in the adoption agreement to provide                   
          severance benefits to its eligible employees in the amount of 10            
          percent of an employee’s compensation for each year of                      
          participation, with no credit for past service.  VRD/RTD also               
          elected not to provide the optional life insurance benefit.  Drs.           
          DeAngelis and Domingo understood that in order for VRD/RTD to               
          claim deductions for its contributions to STEP they had to couch            
          any subsequent application for benefits in terms that appeared to           
          make the severance event nonvolitional.                                     
               B.  Relevant Provisions in the Adoption Agreement                      
               Eligible employees were defined in the adoption agreement as           
          all full-time employees, other than controlling owners, who were            
          21 and had completed 1 year of service and whose job title was              
          “doctor” or “office administrator/business mgr”.  A “controlling            
          owner” was defined in the adoption agreement as a person who                
          owned more than a 25-percent voting interest in the participating           
          employer, unless four or fewer other persons owned in the                   

Page:  Previous  15  16  17  18  19  20  21  22  23  24  25  26  27  28  29  Next 

Last modified: March 27, 2008