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Dividends were credited to the policy, and insurance charges were
taken out of each of the policies to pay for the cost of
providing the covered employee with life insurance coverage.
STEP applied a factor to the cash value of the life insurance
policy on the covered employee’s life in order to compute the
benefit payable to the employee. The insurance policies (or the
cash derived therefrom) were distributed to VRD/RTD’s
participating employees without regard to STEP’s purported
computation of the allowable amounts of severance benefits.
XV. Dr. Domingo’s Receipt of Plan Benefits
On April 3, 1997, Dr. Domingo wrote to Mr. Katz requesting a
“legal opinionated [sic] letter” regarding his “intent to retire
within the time period of 3 years” for “business reasons and for
continuity of our surgical group.” Dr. Domingo requested that
any response be sent to him “Personal and Confidential.” Mr.
Katz relayed Dr. Domingo’s letter to Mr. Pagano. On May 1, 1997,
Mr. Pagano advised Dr. Domingo that he would receive full
benefits under the STEP criteria of “good cause” and “genuine
business purpose” if he resigned after being asked to retire.
Mr. Pagano advised Dr. Domingo that he would not qualify for
benefits if he agreed to work for VRD/RTD in a different
capacity.
On March 21, 2001, Dr. Domingo informed Teplitzky & Co. that
on January 1, 1999, he “retired completely from my surgical
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Last modified: March 27, 2008