Laidlaw Transportation, Inc. and Subsidiaries - Page 40

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          suggested by Haworth other than the provision to subordinate                
          loans.  It provided that LWSI or Transit would give LIIBV                   
          promissory notes and that the advances, which those notes                   
          represented, would be treated as if they had been made under the            
          loan agreement.  The second "as of September 1, 1986" agreement             
          substituted a demand feature for a fixed maturity date.  LIIBV              
          did not require Transit, Tree, and LWSI to have a reserve or                
          sinking fund to assure that they could repay the advances.  The             
          second "as of September 1, 1986" agreement governed all prior               
          advances by LIIBV to Transit or LWSI.                                       
               On July 7, 1987, LTI, Transit, LII, and LWSI signed new loan           
          agreements with LIIBV.  These agreements governed all advances              
          made by LIIBV to Transit and LWSI before July 7, 1987.  They                
          included the same terms as the "as of September 1, 1986"                    
          agreements, except that (1) the July 7, 1987, agreements                    
          eliminated the demand feature from the previous loan agreements             
          and established fixed terms with principal balances due September           
          1, 1989, unless the parties extended the due date by written                
          agreement, and (2) the parties added some enforcement provisions,           
          including an acceleration clause.  LIIBV did not require a                  
          reserve or sinking fund to assure that petitioners would repay              
          the advances.                                                               










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