This revised message is being sent to correct an inaccuracy that was contained in the first paragraph of the message you received previously, and also to provide an important clarification about the method of payment for some individuals.
Important Clarification: There are a small number of individuals who received their Pensioner Life distribution payment by direct deposit in mid-November. If you have already received a direct deposit payment for this interim HWT distribution on account of Pensioner Life, then you will not receive a cheque in December.
If you are a Nortel pensioner who has not received a direct deposit payment from the Nortel HWT in the past, then any HWT distribution you receive will be paid by cheque.
Nortel Pensioners - Cheques for Partial Payment of Pensioner Life Insurance Claims are Being Mailed
In November 2010, the Court approved a methodology for the allocation of the assets held in Nortel’s Health and Welfare Trust (HWT). In accordance with the court-approved methodology, pensioner Life Insurance (LIFE), LTD Life, LTD Optional Life and the Survivor and LTD Income Benefits will share in the assets of the HWT on a pro rata basis. A small group of LTD employees challenged that decision and it was not until June 2011 that the challenge was dismissed by the Supreme Court of Canada making the way clear for a distribution for Pensioner LIFE.
Because of the August 2011 cutbacks in pensioner payments, the NRPC pushed for a year end payout for pensioners from the HWT. The first instalment from the assets of the HWT is now being mailed by E&Y as a cheque. We expect the bulk of these mailings (over 8,100 cheques) to happen this week, but some 600 are awaiting clearance and may take until December 16th to process. We will let you know when the last mailing has taken place. We request that you wait until at least December 16 to contact E&Y if you do not have your cheque.
If on your Form A (in the claims package recently mailed to you by E&Y), you have an amount beside the line: “Pensioner Life (including ADB, if applicable)”, you should shortly be receiving a cheque for 20% of that claim amount minus withholding tax.
If you believe you have a valid claim for Life Insurance and it was not reflected in your Form A claims document, you should submit a Form C to E&Y. Please note that not all pensioners have Life Insurance claims.
As Nortel’s HWT proceeds to be wound up, we expect there will be a second and smaller distribution (~5 to 7%) from the HWT sometime in 2012. We will keep you apprised of developments.
The residual amount of your LIFE claim (total claim minus the two instalments from the HWT) will be a claim on the Nortel Canadian estate payable at cents on the dollar when the estate is settled (2012/13/1?).
Also note that the NRPC along with KM are working to remove the taxation of the Life Insurance benefits. If we are successful, you may have to re-file your 2011 income tax to recover taxes paid. Hold on to your tax documents. Again we will keep you apprised of developments.
Koskie Minsky LLP