2% S Corporation Shareholder

[Guest Buzzman]

10 years ago corporation institutes special post-retirement paid health insurance benefit for key executives (who are also 2%+ shareholders), pursuant to which these key execs would continue to receive company-paid health insurance for term of years after retirement - it was intended that the benefit be excludable from income.

At the time retiree health plan was implemented, corporation was a C corp. Two years ago corporation converted to S corp. and health insurance benefit to 2% shareholders became taxable.

Here's the question - upon retirement, key execs' stock is redeemed, so that at time receive retiree health benefit, they will not own any stock in the corporation, so does benefit revert to being excludable from income as typical retired employee health insurance benefit?