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 47




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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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