Northern Indiana Public Service Company - Page 9

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            through September 1986 included the accounts receivable that were                         
            listed in the assignment document.                                                        
                  Petitioner did not send a letter notifying the account                              
            debtors of the execution of the assignment document, nor did                              
            petitioner file financing statements, as that term is defined in                          
            the Uniform Commercial Code.  During the period the Euronotes                             
            were outstanding, petitioner engaged in no borrowing transactions                         
            in which any of its accounts receivable were pledged to an                                
            unrelated third party or otherwise subject to a security interest                         
            of an unrelated third party.  The balance of the accounts                                 
            receivable at all times relevant herein exceeded $28 million.                             
                  Finance received annual interest payments in 1982, 1983,                            
            1984, and 1985 in the amount of $12,775,000 from petitioner.                              
            Finance made annual interest payments in the amount of                                    
            $12,075,000 in 1982, 1983, 1984, and 1985 to the holders of the                           
            Euronotes.  Finance's aggregate income on the spread between the                          
            Euronote interest and the interest on petitioner's note was                               
            $2,800,000.  In addition, Finance earned interest income on its                           
            investments (exclusive of interest paid by petitioner on its                              
            note).                                                                                    
                  On October 10, 1985, petitioner repaid its note plus accrued                        
            interest and early payment premium to Finance.  The payment                               
            consisted of $70 million in principal, $12,775,000 in interest                            
            for the period ending October 15, 1985, and a $1,050,000 call                             
            premium.  On October 15, 1985, Finance redeemed the Euronotes by                          




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