TCR_Public/000223.MBX   T R O U B L E D   C O M P A N Y   R E P O R T E R

     Wednesday, February 23, 2000, Vol. 4, No. 37

ABLE TELECOM: Wellington Management Reports Holdings
ALPHA TUBE: Change of Composition of Committee
AMERICAN TRACK: Trustee Applies To Employ The Bayard Firm
AMERISERVE: Applies To Retain Robert Marston
ATC GROUP: 4th Amended Disclosure Statement Wins Court OK

BABCOCK & WILCOX: McDermott Announces Chapter 11 Reorganization
BABCOCK & WILCOX: McDermott Int'l Announces Quarter Earnings
BOSTON CHICKEN: Stockholders Asked to Volunteer for Committee
CARLETON: Files For Bankruptcy Protection
CASMYN CORP: Order Authorizes Committee to Employ Counsel

CASMYN CORP: Reports Approval of Disclosure Statement to SEC
CORSON MFG: To Shut Down In Spring - No Buyer
DIRECT POWER PLUS: Meeting of Creditors
GARGOYLES: Capital Group Holds No Common Stock
GSS STEEL: Seeks Extension of Exclusivity

ICO GLOBAL: Files Disclosure Statement and Reorganization Plan
INCOMNET: Reports Events Important to Common Shareholders
INCOMNET: Seeks Assignment of DIP Financing
JITNEY JUNGLE: Announces Store Closings

KCS ENERGY: Seeks Approval of Disclosure Statement
LOEWEN: Announces Results for the Quarter and Year-End
MCGINNIS: Notice of Order Confirming Plan
MESA AIR GROUP: Wellington Management Reports Holdings
MONDI OF AMERICA: Seeks Extension To Assume/Reject Leases

NEW WORLD COFFEE: FMR Corp and Johnson No Longer Hold Stock
PARAGON TRADE BRANDS: Exits Chapter 11 - Report To SEC
SERVICE MERCHANDISE: Announces 1999 Results and Business Plan
SERVICE MERCHANDISE: Second Motion To Extend Exclusivity
SUCCESS MULTIMEDIA: Plan and Disclosure Statement

SUCCESS MULTIMEDIA: Last Date For Filing Proofs of Claims
TAESA: Mexico's Airline Declared Bankrupt
TITAN INTERNATIONAL: United Steelworkers Berate Taylor
TURBODYNE: Updates On The Sale Of Its Light Metals Division
UNITED KENO HILL MINES: Applies For Protection Under CCAA

Meetings, Conferences and Seminars


ABLE TELECOM: Wellington Management Reports Holdings
Wellington Management Company, LLP, in its capacity as investment
adviser, may be deemed to beneficially own 764,000 shares of the
common stock of Able Telecom Holding Corp., which are held of
record by clients of Wellington Management Company. Wellington
shares voting power over 434,000 of the shares and shared
dispositive power over 764,000 shares.  The total amount held
represents 6.30% of the outstanding common stock of Able

ALPHA TUBE: Change of Composition of Committee
The Official Committee of Unsecured Creditors of Alpha Tube
Corporation submits a notice of change in its composition.

After notification that the Alpha Tube Corporation voted to
oppose further extensions of the period of exclusivity for Alpha
Tube, the following members of the Committee submitted their

Kerry Steel Inc., Marubeni America Corporation, United Materials
Co. Rouge Steel Company.

The following members have remained with the Alp-ha Tube
Committee and have not submitted resignations:

Alliance Steel, Inc
AK Steel Corporation and
Pittsburgh Logistics Systems, Inc.

The Alpha Tube Committee is informed and believes that another
member of the committee may resign as well.

Deutsche Bank purchased at least one claim held by a committee
member.  The Alpha Tube Committee is informed and believes that
there is an active claims purchasing program for Alpha Tube
Claims undertaken by Long Acre Funds and Deutcsche Bank and that
the composition of the creditors committee may change further due
to claims purchasing activity.

AMERICAN TRACK: Trustee Applies To Employ The Bayard Firm
Robert H. Slone, the Chapter 7 trustee in the Chapter 7 case of
American Track Systems International, Inc. filed an application
for authority to employ and compensate The Bayard Firm as
bankruptcy counsel for the debtor's Chapter 7 trustee nunc pro
tunc to January 13, 2000.

The rates for the principal attorneys working on this case are
$295 per hour and $160 per hour.

AMERISERVE: Applies To Retain Robert Marston
The debtors, AmeriServe Food Distribution, Inc. applies to employ
and retain Robert Marston Corporate Communications, Inc. as
public relations consultant to the debtors as of February 1,

The services of the firm will include:

Develop and implement a comprehensive public relations strategy
and plan designed to inform customers, vendors, employees,
creditors, the news media and other important audiences of
developments involving the debtors.

Provide strategies communications counseling; and

Represent the debtors before the news media covering the
bankruptcy proceedings and related issues.

The debtors have agreed to pay an engagement fee of $100,000 to
the firm.  The firm will file interim applications for approval
of its fees and expenses with the court.

ATC GROUP: 4th Amended Disclosure Statement Wins Court OK
ATC Group Services Inc. won court approval of the disclosure
statement on Tuesday related to its reorganization plan after
amending the document for the fourth time in response to the
objection of the U.S. Trustee acting in the case, according to an
order. The trustee sought more information from the company
regarding the nonbinding term sheets it received from both its
debtor-in-possession lenders, to provide a senior exit financing
facility, and from ATC Holdings  LLC, to provide a senior
subordinated exit financing facility.(The Daily Bankruptcy Review
and ABI Copyright c February 22, 2000)

BABCOCK & WILCOX: McDermott Announces Chapter 11 Reorganization
McDermott International, Inc. (NYSE: MDR) announced that its wholly
owned subsidiary, The Babcock & Wilcox Company (B&W), and certain
of B&W's subsidiaries, filed a voluntary petition in the
U.S. Bankruptcy Court for the Eastern District of
Louisiana in New Orleans to reorganize under Chapter
11 of the U.S. Bankruptcy Code. B&W is taking this action because
it offers the only viable legal process by which it can seek to
determine and comprehensively resolve asbestos liability claims.

"Unfortunately, the other avenues through which we might
reasonably resolve this issue appear to have been closed," said
Roger Tetrault, chairman of the board and chief executive officer
of McDermott International, Inc. "Historically it has been B&W's
practice to settle asbestos claims out of court. This has been
a reasonable and responsible approach for nearly 20 years, which
minimized costs to B&W and maximized payments to claimants.
However, recent increases in settlement demands from claimants,
coupled with a lack of legislative relief from the financial
burden presented by the increased demands, have forced us to
reexamine that approach. The asbestos claims, in the context in
which they are now presented, represent a serious threat to B&W's
future. This filing is the only means available to resolve them."

Included in the filing are The Babcock & Wilcox Company and its
subsidiaries Americon, Inc., The Babcock & Wilcox Construction
Company, Inc. and Diamond Power International, Inc. B&W Canada is
not part of the filing; however, B&W has requested that the Court
issue an injunction staying asbestos suits from being brought
against B&W Canada. No other B&W subsidiary, nor any other
McDermott subsidiary, such as BWX Technologies, Hudson Products,
the Delta companies, McDermott Technology and J. Ray McDermott,
is included in the filing.

To ensure that it has the capital necessary to meet letter of
credit and cash needs to continue to operate its business, B&W
has obtained a commitment of up to $300 million in debtor-in-
possession (DIP) financing provided by Citibank, N.A. and Salomon
Smith Barney, members of Citigroup. B&W has requested, on an
expedited basis, Court approval of this financing package.
McDermott International, Inc. and certain of its other
subsidiaries have obtained an additional $500 million of
financing provided by Citibank, N.A. and Salomon Smith Barney,
members of Citigroup, to ensure uninterrupted operations in the
balance of its operating segments. The additional financing
consists of up to $ 300 million at J. Ray McDermott and up to
$200 million at McDermott International, Inc.

"Our business remains solvent and strong. However, the recent
increased demands for settlement of asbestos claims represent a
real threat to B&W's long-term health unless we take this step
now," said James F. Wood, president of B&W. "Although it is not
unusual for B&W to receive high initial settlement demands, we
generally have been successful in negotiating those demands to
tolerable levels. Recently, however, this has not been the case.
As a result we are forced to make this Chapter 11 filing.

As part of a plan of reorganization to be filed at a later date,
B&W intends to establish a trust that will provide a process
through which future asbestos claims will be evaluated and

Like many other companies, B&W was a purchaser of asbestos rather
than a manufacturer. The material was used many years ago in the
power generation industry as insulation to protect people and
equipment from high temperatures inside industrial, utility and
marine boilers. The use of asbestos was specified and encouraged
by U.S. government agencies for decades. B&W utilized asbestos in
conformance with guidelines published by applicable regulatory
bodies. Like many other users of asbestos, B&W was unaware that
its use of asbestos posed health hazards. After government
regulations imposed low exposure thresholds for asbestos in the
early 1970s, asbestos use by B&W and others in industry was
phased out.

B&W was acquired by McDermott in 1978. In 1982, B&W began to
settle claims for asbestos exposure. As of December 31, 1999, B&W
had settled over 340,000 asbestos claims, with approximately
another 45,000 claims outstanding and presented for settlement.
The total cost of settling claims since 1982 has been over $1.6
billion, including payments to claimants, defense and legal
costs, and claims processing costs. The settlement costs were
borne by both B&W and its insurers.

In recent months, settlement demands from claimants' lawyers have
spiked to levels dramatically above the historical pattern. B&W's
effort to negotiate the increases down to tolerable levels has
been unsuccessful, which has precipitated today's filing.

"Recently, B&W saw a sharp increase in the price demanded by some
claimants' lawyers to settle asbestos claims against B&W. Those
increases were not justified by any change in the facts, the law,
or in B&W's liability posture, nor was the company offered any
reasonable explanation for these increases by the claimants'
attorneys. Under these circumstances, this step is the only way
approved by the courts to determine B&W's total asbestos
liability and to resolve legitimate asbestos claims," said Wood.
"A balance must be struck between the legitimate rights of
plaintiffs who were actually injured by asbestos exposure, and
who can establish that their injury was attributable to B&W, and
the interests of employees, shareholders and communities that
have suffered from this phenomenon."

The U.S. Supreme Court has on several occasions stated that the
asbestos issue requires legislative relief. In Ortiz et al. v.
Fibreboard Corporation et al. (1999), the Court stated that the
"elephantine mass of asbestos cases...defies customary judicial
administration and calls out for national legislation." While
legislation has been introduced into Congress, no action has
been concluded to date. The Supreme Court has also observed that
Chapter 11 - in contrast to class actions or other traditional
means of resolving mass claims in the legal system - offers the
only viable legal means for companies seeking to settle and
resolve asbestos exposure claims.

"We concur with the Supreme Court's position that there needs to
be a reasonable legislative solution to the asbestos issue,
particularly since the current targets of litigation are largely
not manufacturers of asbestos, but customers who were unaware of
the hazards it presented," said Tetrault. "It is unfortunate that
such legislation has not been implemented in time to help B&W
resolve its particular situation."

Babcock & Wilcox is a subsidiary of McDermott International,
Inc., a leading worldwide energy services company. McDermott
subsidiaries manufacture steam-generating equipment,
environmental equipment, and products for the U.S. government.
They also provide engineering and construction services for
industrial, utility, and hydrocarbon processing facilities, and
to the offshore oil and natural gas industry.

BABCOCK & WILCOX: McDermott Int'l Announces Quarter Earnings
McDermott International, parent company of Babcock & Wilcox

-- Operating income of $22.9 million

-- Net loss of $23.2 million or $0.39 a diluted share, including
loss of $ 37.8 million or $0.64 a diluted share on curtailment of
U.K. pension plan

-- Curtailment of plan will increase cash by about $21 million
later in 2000

-- Total backlog improves to $3.3 billion

McDermott International, Inc. (NYSE: MDR) reported a net loss of
$23.2 million or $0.39 a diluted share for the quarter ending
December 31, 1999. The quarter's results compare with net income
of$42.3 million or $0.71 a diluted share in the same quarter a
year ago.

For the new fiscal period(1) ended December 31, net income
was$0.4 million or $0.01 a diluted share in 1999 compared with
$215.5 million or $3.50 a diluted share in 1998. In the three and
nine months of 1999, a loss on the curtailment of a U.K. pension
plan reduced net income by $37.8 million. The nine months in
1998 included non-recurring after-tax gains of $91.1 million.

For the 1999 quarter, revenues were $647.3 million compared
with$800.8 million a year ago. Revenues for the new fiscal period
were$1.9 billion in 1999, compared with $2.4 billion in the final
nine months of 1998. The lower revenues in the 1999 periods are
primarily attributable to a decline at J. Ray McDermott, the
company's marine construction services unit.

Operating income was $22.9 million and $74.7 million for the
quarter and new fiscal period in 1999 respectively, compared
with$46.3 million and $230.4 million in the three and nine months
a year ago. Operating income in 1999 included losses from
investees of $3.9 million and $11.0 million in the quarter
and new fiscal periods, respectively, compared with income from
investees of $ 0.5 million and$14.3 million in the 1998 quarter
and nine months, respectively. The nine months in 1998 included
net gains on asset disposals and impairments of $37.0 million.

Other expense in the December 1999 quarter was $35.4 million and
for the new fiscal period was $39.6 million, including the
pension plan curtailment. This compares with other expense of
$10.4 million in the year ago quarter and other income of $1.6
million in the final nine months of 1998. Interest income,
interest expense and minority interest all decreased in the 1999

The company expects to receive cash of about $21 million later in
2000 as a result of the curtailment of the pension plan.

McDermott's Babcock & Wilcox subsidiary filed for protection
under Chapter 11 of the U.S. Bankruptcy Code. Babcock & Wilcox's
financial statements have previously been consolidated with
McDermott International's. However, generally accepted accounting
principles specifically require that any entity whose financial
statements are consolidated with its parent and who files for
protection under the U.S. Bankruptcy Code must be
deconsolidated in the future and presented on the cost method.
This is true whether the entity is solvent or insolvent.

The cost method will require McDermott to present the net assets
of B&W at February 22, 2000 as an investment and not recognize
any income or loss from B&W in the results of its operations
while B&W is in reorganization. When B&W emerges from the
jurisdiction of the Bankruptcy Court, the subsequent accounting
will be determined based on the terms of the reorganization plan.

McDermott International, Inc. is a leading worldwide energy
services company. The company's subsidiaries manufacture steam-
generating equipment, environmental equipment, and products for
the U.S. government. They also provide engineering and
construction services for industrial, utility, and hydrocarbon
processing facilities, and to the offshore oil and natural gas

BOSTON CHICKEN: Stockholders Asked to Volunteer for Committee
Stockholders of Golden, Colo.'s Boston Chicken are being asked to
consider volunteering their services for a committee appointed by
the U.S. Trustee, according to a newswire report. The committee
would represent Boston Chicken's debtors and equity holders.
Stockholders wishing to volunteer their services can find out
more information by visiting A list of
candidates will be submitted to the U.S. Trustee within the next
few days. (ABI 22-Feb-00)

CARLETON: Files For Bankruptcy Protection
The Kennebec Journal (Augusta, ME) reports on February 19, 2000
That Carleton Woolen Mills has filed for bankruptcy protection in
U.S. Bankruptcy court in Bangor.

The two woolen mills, which began reopening for business last
Monday and Tuesday, filed for Chapter 11 under the bankruptcy
code Thursday.  The reorganization allows Carleton to discuss
restructuring debts with its principal lender, Fleet Capital
Corporation, and talk to third party investors about loans
or a buyout, according to attorney Robert Keach, who represents

The company has been in discussion for two months with potential
investors, he said.  They include Tiroler Loden, an Innsbruck,
Austria, textile manufacturer, as well as a Canadian company, he

Although no further information about the companies was given by
Keach or Carleton management, the English version of Tiroler
Loden's Web site, at tirole.html, gives details of
some of the company's products.

Carleton closed its mills in late December of last year after its
parent company, Allied Textile Companies, withdrew financial

CASMYN CORP: Order Authorizes Committee to Employ Counsel
By order entered February 14, 2000, the US Bankruptcy Court for
the Central District of California, San Fernando Valley Division
entered an order authorizing the Official Committee of Unsecured
Creditors of Casmyn Corp. to employ Irell & Manella LLP as its
counsel effective January 6, 2000.

CASMYN CORP: Reports Approval of Disclosure Statement to SEC
Casmyn Corp. announces that on February 3, 2000, the United
States Bankruptcy Court, Central District of California, San
Fernando Valley Division, approved the Second Amended Disclosure
Statement Describing Debtor's Second Amended Plan of
Reorganization and authorized the distribution of documents to
both creditors and common and preferred shareholders for purposes
of voting on the Debtor's Second Amended Plan of Reorganization.

The Official Unsecured Creditors Committee recommends the Plan
and that other creditors and shareholders vote to accept the
Plan.  Ballots must be received by March 17, 2000 and the
confirmation hearing for the Plan has been set for March 31,

The Plan contemplates an equity recapitalization that will result
in the conversion into common stock of substantially all of the
company's debt and  all of the outstanding preferred stock.  The
company's gold mining operations in Zimbabwe are owned by
separate subsidiary companies which are not a part of the Chapter
11 filing and are continuing to conduct business as usual.

Copies of the Plan, the Disclosure Statement and other
solicitation materials are available at  
Creditors and shareholders may contact Richard Wynne, the
company's bankruptcy counsel, in Los Angeles, California, at
Wynne Spiegel Itkin, 310-551-1015, by fax at 310-551-3059,
or by e-mail at

CORSON MFG: To Shut Down In Spring - No Buyer
The Buffalo News reports on February 18, 2000, that packaging
maker Corson Manufacturing Co. in Lockport will shut down this
spring, erasing 235 jobs as the insolvent company gives up on
finding a buyer.

"It's difficult -- a lot of people put in a lot of years here,"
President Steven B. Gidwitz said.

Founded in 1907, Corson supplies printed cartons for Nabisco and
other companies. With two locations in Lockport, it makes boxes
for Triscut crackers and Milk Bone dog biscuits, among other

The company announced the pending shutdown to employees Wednesday
after efforts to sell the operation fell through earlier in the
week, Gidwitz said.

Corson filed for Chapter 11 bankruptcy reorganization on Dec. 15,
according to U.S. Bankruptcy Court records in Buffalo. It is
majority owned by the Gioia Management Group in Buffalo, owner of
Cello-Pack Corp. and Armor-Box Corp.

"The other two companies are not affected at all," Gioia chairman
Anthony D. Gioia said. Cello-Pack and Armor-Box, which employ
over 200 people in all, make different container products than
Corson and focus more on local markets, he said.

The bankruptcy filing came after the loss of an unnamed customer,
Gidwitz said. The lost business made it impossible for the
company to pay its bills. Layoffs will begin in April and the
shutdown of manufacturing will occur about mid-June, Gidwitz
said. Corson will sell off its plant and equipment through
auctions, completing the process sometime in July, he said. The
company will file notice of liquidation with the bankruptcy court
next week.

Severance terms aren't set, pending discussions with the Graphic
Communications International Union Local 27, which represents 188
Corson workers, Gidwitz said. Average pay for the printing
workers is about $ 13, he said.

Without a sale of the company, the Niagara County Industrial
Development Agency couldn't develop a package of incentives to
preserve jobs, Executive Director John Simon said. The agency met
with Corson officials and its power company, New York State
Electric & Gas Corp., in recent weeks, he said.

After sale negotiations fell through, it's "unlikely, but not
impossible" that a buyer of company assets might resume some
printing operations, Gidwitz said.

"If someone were to come in, they'd have to bring customers with
them," he said.

Excess capacity in the industry is squeezing makers of packaging.
Better technology has increased box-printers' volume faster than
growth in customer orders, he said.

In addition, Corson faced competition from box suppliers who
owned paper production operations, giving them greater
flexibility in pricing.

"The integrated company may make money on paper and take a hit"
on printing operations, Gidwitz said.

Corson was founded 93 years ago as the publisher of a newspaper
called the Lockport Union, he said.

DIRECT POWER PLUS: Meeting of Creditors
A chapter 11 bankruptcy case concerning Direct Power Plus LLC was
filed on January 20, 2000.  Attorney for the debtor is Tracy L.
Klestadt, The Chrysler Building, 405 Lexington Avenue, 42nd
Floor, New York, NY.  A meeting of creditors will be held on
March 15, 2000 at 2:00 PM at the US Bankruptcy Court, SDNY, 300
Quarropas Street, Room 243A, White Plains, NY.

GARGOYLES: Capital Group Holds No Common Stock
Capital Group International, Inc. reports that the Group no
longer holds common stock in Gargoyles Inc.

GSS STEEL: Seeks Extension of Exclusivity
Gulf States Steel, Inc. of Alabama seeks entry of a court order
extending its exclusive periods through April 30, 2000 and June
30, 2000, respectively.  The debtor states that it has completed
its revised business plan.  The plan now covers a ten year
period.  The plan is the foundation for the debtor's
reorganization, and forms the basis for the debtor's proposed new
capital structure.  It is also an essential component of the
effort to value the debtor's business and is the supporting basis
for the application under the Steel Act for a federal guaranty of
the debtor's financing from BofA.

The debtor states that it has not had sufficient time to
negotiate a plan of reorganization and prepare adequate
information.  The debtor also states that unresolved
contingencies warrant the extension of exclusivity.

ICO GLOBAL: Files Disclosure Statement and Reorganization Plan
ICO Global Communications, the global mobile communications
company, filed a motion seeking approval of its disclosure
statement and plan of reorganization in the U.S. Bankruptcy Court
in Delaware. A hearing before the U.S. Bankruptcy Court has been
scheduled for approval of the disclosure statement on March 21,

ICO announced on February 4 that Eagle River Investments LLC,
telecommunications pioneer Craig McCaw's private investment
company, had entered into a definitive agreement with ICO to
acquire control of the company.
ICO Global Communications (Nasdaq: ICOFQ) was established in
January 1995 as a private company to provide global mobile
personal communications services by satellite, including digital
voice, data, facsimile, high-penetration notification, and
messaging services. ICO Global Communications was listed on
Nasdaq in July 1998. The stock was suspended from trading when
the company filed for Chapter 11 protection on August 27, 1999.

Craig McCaw is chairman of Teledesic LLC, which is building a
global broadband Internet-in-the-Sky satellite communications
network. Mr. McCaw and Microsoft founder Bill Gates are the
company's two primary founding investors. Strategic investors
also include Motorola, Saudi Prince Alwaleed Bin Talal and
The Boeing Company. Teledesic (pronounced "tel-eh-DEH-sic") is a
private company based in Bellevue, Washington, a suburb of

Incomnet Communications Corporation, developed and launched a new
internet-based network marketing program called SIMPLE2NET. The
SIMPLE2NET product complements existing communications and
internet related services already offered by Incomnet
Communications Corporation.

SIMPLE2NET is an innovative internet-based network marketing
program offering a personalized web site and access to a planned
internet-based mall and offers a two stage compensation program.
The compensation program focuses on Incomnet Communications
Corporation customer acquisition and retention and marketing
organization development. SIMPLE2NET currently offers web site
sales and Incomnet Communications Corporation services.

George Blanco, Incomnet's Chief Operating Officer said, "We are
very excited about the quality and extent of interest in our
SIMPLE2NET marketing program. We believe that the SIMPLE2NET
program will position Incomnet's network marketing
program in the internet-age and into the new millennium. We are
confident that it will assist ICC in attracting and retaining
high quality marketers who will be properly compensated for
acquiring and retaining new customers."

INCOMNET: Reports Events Important to Common Shareholders
Incomnet, Inc., the parent company of Incomnet Communications
Corporation, an Orange County, California based sales and
marketing company providing innovative cost-saving communications
and internet related services, reports events important to its
common shareholders. As previously announced, on September 2,
1999, Incomnet, Inc. and its wholly owned subsidiary Incomnet
Communications Corporation each filed for voluntary
petitions for protection under Chapter 11 of the Federal
Bankruptcy Code in the United States Bankruptcy Court for the
Central District of California, Santa Ana Division.

On September 3, 1999, Incomnet, Inc.'s shares of common stock,
which traded under the symbol ICNTE, were de-listed from the
Nasdaq SmallCap Market. This action was taken as a result of
Incomnet, Inc.'s failure to meet the net tangible assets and
filing requirements. Management does not anticipate that
Incomnet, Inc.'s shares of common stock will be re-listed.

As a result of Incomnet, Inc.'s Chapter 11 reorganization
proceedings, management anticipates that shareholders of
Incomnet, Inc. will receive no value for Incomnet, Inc. common
shares. Management also believes that members of the class action
lawsuit will receive nothing from their previous settlement
agreement. Although a final determination has not yet
been made, it is management's opinion that after all secured and
unsecured creditors have settled with Incomnet, Inc. in
accordance with the Chapter 11 proceedings, no residual value
will be left for Incomnet, Inc. shareholders or class action

Incomnet, Inc. had net sales of $7.9 million (unaudited) and $7.7
million (unaudited) for the second and third quarters ended June
30, 1999 and September 30, 1999, respectively. The decrease in
revenues is primarily due to a decline in ICC subscribers and
long distance rates charged to customers in the highly
competitive telecommunications market. Through September, 1999,
Incomnet, Inc. continued incurring significant net losses

INCOMNET: Seeks Assignment of DIP Financing
Incomnet Communications Corporation received court approval for
the assignment of Incomnet Communications Corporation's debtor-
in-possession financing from Foothill Capital Corporation to
Ironwood Telecom LLP, Incomnet, Inc.'s largest secured creditor.
Incomnet will be obligated under substantially the same financing
terms with Ironwood as it was with Foothill. The assumption by
Ironwood allows Incomnet more time to execute its reorganization
efforts in the coming months. George Blanco, Incomnet's
Chief Operating Officer, said, "Foothill has been a very
important partner in Incomnet's reorganization efforts. We have
maintained a very positive relationship with Foothill and greatly
appreciate their spirit of cooperation and support during this

JITNEY JUNGLE: Announces Store Closings
Jitney Jungle Stores of America, Inc. announced the closing of
the following 5 stores on Saturday February 19th, 3366 Terry Road
Jackson, Ms., 311 West Northside Drive Jackson, Ms., 189 Peace
Street Canton, Ms., 2031 East Madison Ave. Bastrop, La., and 1102
East Admiral Doyle Drive New Iberia, La.  These closings are part
of the company's previously announced plan to close low volume
underperforming stores as part of its ongoing effort to emerge
from bankruptcy restructuring.

Ron Johnson President and Chief Executive Officer of Jitney
Jungle Stores of America said, "JJSA, Inc. has an 80 year history
of successful operations in its core markets.  Our objective is
to use the reorganization process on a fast track basis to create
a more manageable capital structure and strengthen our business
operations.  We are confident that by either selling or closing a
group of underperforming stores and streamlining operations JJSA,
Inc. can significantly enhance its profitability."  Each store
employed about 50 associates, all of whom were offered jobs at
other stores within the chain where openings were available.  
Johnson also said that there could possibly be two or three
additional store closings in the next two or three months and
that should complete our transition into a smaller but stronger

"Our plans are to emerge from bankruptcy by the end of the year
without debt and with a financial structure in place that should
enable this company to move forward for the next 80 years,"
Johnson said.

Jitney Jungle Stores of America, Inc. currently operates 172
grocery stores, 54 gas stations and 10 liquor stores located
throughout Mississippi, Alabama and Louisiana and in Tennessee,
Florida and Arkansas.

KCS ENERGY: Seeks Approval of Disclosure Statement
The debtors filed a motion seeking an order approving the
Disclosure Statement and fixing a date, time and place for a
confirmation hearing.  A hearing on the motion will be held on
February 25, 2000.  The debtors are seeking a hearing on the
confirmation of the plan on April 6, 2000 at 11:30 AM and
approval of the form of ballots.

LOEWEN: Announces Results for the Quarter and Year-End
The Loewen Group Inc. (NYSE, TSE: LWN), announced its unaudited
results for the year and quarter ended December 31, 1999 and
commented on the progress of its reorganization since the Company
was granted court protection from creditors on June 1, 1999.     
The Company achieved a 53 percent improvement in operating income
to $106.6 million for 1999, compared with operating income of $
69.9 million in 1998. The loss from operations in the fourth
quarter was $2.9 million, an improvement of $43.5 million over
the loss from operations of $46.4 million in fourth quarter of
1998. These are before a provision for asset impairment of $355.2
million in 1999 of which $340.1 million occurred in the fourth
quarter. Including the provision for asset impairment described
above, reorganization costs and the impairment and contingent
losses on two investments, the Company reported a net loss of
$465.2 million ($6.40 per share) on gross revenue of $1,030.4
million for the year ended December 31, 1999, compared with a net
loss of $599.0 million ($8.22 per share) on gross revenue of
$1,136.2 million for the year ended December 31, 1998. For the
quarter ended December 31, 1999, the Company reported a net loss
of $368.7 million ($5.00 per share) on gross revenue of $223.7
million compared with a net loss of $606.8 million ($8.22 per
share) on gross revenue of $260.7 million for the quarter
ended December 31, 1998.  John S. Lacey, Chairman of the Board,
said the results demonstrate that the Company's core business is
sound, both on an operating and on a cash basis.  "Our operating
performance over the past year may be overshadowed by the large
non-cash provisions we have made in the process of reorganizing
for the future,'' Mr. Lacey said. "The improvements we have
commenced in our operations have enabled the Company to generate
positive operating income in 1999 and provide a foundation upon
which management can continue to improve service to clients at
competitive prices while reducing costs.''

Funeral home revenues for the fourth quarter were $ 147.5
million, a decrease of 6.5 percent from $157.7 million in the
fourth quarter of 1998. This decrease was due to a reduced
average revenue per funeral service and fewer funeral services,
primarily, management believes, as a result of the bankruptcy
filings. On a same store basis, the number of funerals
performed was down 7.6 percent compared with the fourth quarter
of 1998. Overall funeral home gross margins in Q4 1999 increased
to 33.9 percent compared with 29.6 percent in Q4 1998. The
Company performed approximately 39,500 funeral services during
the fourth quarter of 1999 compared with 41,500 in the same
period a year earlier.  "The significance of these quarterly
results is that they were achieved during the second complete
quarter of operations since the Company filed for creditor
protection. The results demonstrate that our employees have
performed well under difficult conditions and have succeeded in
maintaining our level of service,'' Mr. Lacey said. Fourth
quarter cemetery revenues were down 32.1 percent to $53.5
million, compared with $78.8 million in the same quarter in 1998.
This reflects the sale of 124 cemeteries on March 31, 1999 and
the Company's previously announced changes to its commission
structure and pre-need sales program. Cemetery gross margin was a
loss of $8.5 million for the quarter compared with a loss of
$28.5 million for the same period last year. This includes, in
the fourth quarter of 1999, an increase in the cancellation
reserve of $6 million and approximately $10 million of
adjustments to reflect expected cemetery liabilities based on
current costs and adjustments to mausoleum inventory and projects
in progress. Before these adjustments, the cemetery gross margin
was $7.5 million or 11.2 percent of cemetery revenue. Cemetery
cash flow improved significantly to $2.8 million for the quarter
ended December 31, 1999 compared with negative cash flow of $86.9
million in the same period last year.  General and administrative
expenses were reduced by $13.6 million in the fourth quarter of
1999 from the same period in 1998. General and administrative
expenses of $26.2 million included provisions for certain former
employee and acquisition-related receivables. The Company
continues to reduce its ongoing general and administrative costs.     
The Company's results in the fourth quarter included a $340.1
million non-cash provision for asset impairment, primarily
related to the 201 funeral homes and 170 cemeteries in the
U.S. included in the asset disposition program previously
announced December 15, 1999. In addition, the previously recorded
loss of $13.5 million on the sale of 124 cemeteries on March 31,
1999 was reduced in the fourth quarter to $1.1 million. Other
1999 fourth quarter provisions included an aggregate $59.2
million for further impairment on the Company's investment in
Prime Succession Holdings, Inc. and an adjustment to the accrual
for contingent losses related to the potential future purchase
obligations for both Prime Succession and Rose Hills Holdings
Corp. The Company incurred $14.4 million in reorganization
costs during the quarter arising from expenses related to the
June 1, 1999 filings under Chapter 11 of the U.S. Bankruptcy Code
and under the Canadian Companies' Creditors Arrangement Act.

Revenues for 1999 were $1,030.4 million, compared with $1,136.2
million in 1998. Including non-operating charges during 1999, the
net loss for 1999 was $465.2 million ($6.40 per share). The loss
includes $92.8 million of primarily non-cash reorganization
charges relating to the Company's Chapter 11 and CCAA filings, a
$355.2 million provision for asset impairment primarily in
connection with the asset divestitures and $59.2 million for an
investment impairment and adjustment to contingent losses on the
Company's investments in Prime Succession and Rose Hills.     
Funeral home revenues in 1999 were $609.7 million, a 3.4 percent
decrease. On a same store basis, the number of funerals performed
was down 4.5 percent compared with 1998. Overall funeral home
gross margins remained constant at 35.3 percent compared with
35.5 percent in 1998. Approximately 162,400 funerals in 1999 were
performed compared with 163,400 in 1998. Cemetery revenues in
1999 declined 20.0 percent to $ 326.6 million. This reflects the
sale of 124 cemeteries on March 31, 1999 and the Company's
previously announced changes to its commission structure and
pre-need sales program. Cemetery gross margin increased to $52.8
million for the year compared with $51.3 million in 1998. Before
the fourth quarter adjustments, the cemetery gross margin was
$68.8 million or 21.1 percent of cemetery revenue.

Cemetery cash flow improved by $145.9 million to $32.1 million in
1999. Earnings from operations before provisions for asset
impairment in 1999 improved by $36.7 million, or 53 percent to
$106.6 million.

Management's business plan has been presented to the Company's
Board of Directors and to the court-appointed Official Unsecured
Creditors' Committee. The plan comprises a complete review and
evaluation of the Company's operations. The plan addresses both
the Company's strategic direction and an internal restructuring.     
Mr. Lacey commented: "The Company is committed to becoming a
superior operating company. We are encouraged by the cooperative
relationship we have with the Official Unsecured Creditors'
Committee, by the good performance of our employees during this
difficult period and by our ongoing capability to attract high-
caliber people to Loewen."  "I must emphasize that the Loewen
Group is faced with more than $2.2 billion of debt which, in
reorganization, will rank ahead of the Common and Preferred
shares. It is doubtful that the reorganization will result in
distribution of any consideration to our current common and
preferred shareholders."

In July 1999, the Loewen Group obtained $200 million in
debtors-in-possession ("DIP'') financing to be used as working
capital during the reorganization process. In 1999, the Company
borrowed a maximum of $15 million under the DIP facility and
today, the Company is using the facility only for letters of
credit aggregating $20 million. The Company and its DIP lenders
are undertaking a comprehensive review of the facility in
conjunction with its business plan. The Company believes that
sufficient cash resources currently exist to satisfy its near-
term obligations and is considering a reduction in the DIP

As the Company has announced previously, the New York Stock
Exchange is likely to begin the process of delisting the
Company's shares later this month. This has been expected because
of the Exchange's rule requiring, as a condition of continued
listing, an average and absolute share price of no less than $1
over a 30-day trading period. The Company expects that its shares
will continue to trade on The Toronto Stock Exchange.

The Company is currently divesting 371 non-core funeral and
cemetery operations through a process approved by the Bankruptcy
Court on January 21, 2000. The Company has received over 1,600
inquiries on the divestiture process and has sent out information
packages to over 600 potential bidders as a result. To date, the
Company has received over 250 letters of intent for various
groups of properties.

The Company's attached unaudited consolidated statement of
operations and deficit, balance sheet and cash flow statement
have been prepared on a "going concern'' basis in accordance with
Canadian generally accepted accounting principles. The going
concern basis of presentation assumes that the Company will
continue in operation for the foreseeable future and will
be able to realize its assets and discharge its liabilities and
commitments in the normal course of business. As a result of the
Chapter 11 and CCAA proceedings and circumstances relating to
this event, including the Company's debt structure, recent losses
and negative cash flow, such realization of assets and discharge
of liabilities are subject to significant uncertainty. The
consolidated financial statements do not reflect adjustments that
would be necessary if the going concern basis was not
appropriate. If the going concern basis was not appropriate for
these consolidated financial statements, then significant
adjustments would be necessary in the carrying value of assets
and liabilities, the reported revenues and expenses, and the
balance sheet classifications used. Additionally, the amounts
reported could materially change as part of a plan of
reorganization, since the reported amounts in these consolidated
financial statements do not give effect to all adjustments to the
carrying value of the underlying assets or amounts of liabilities
that may ultimately result. The appropriateness of the going
concern basis is dependent upon, among other things, confirmation
of a plan of reorganization, future profitable operations, the
ability to renegotiate and comply with the terms of the DIP
financing and the ability to generate sufficient cash from
operations and financing arrangements to meet obligations.

Based in Vancouver, The Loewen Group Inc. owns or operates more
than 1,100 funeral homes and more than 400 cemeteries across the
United States, Canada, and the United Kingdom. The Company
employs approximately 13,000 people and derives approximately 90
percent of its revenue from its U.S. operations.

MCGINNIS: Notice of Order Confirming Plan
On February 14, 2000, the US Bankruptcy Court for the Western
District of Texas entered an order confirming the plan and fixing
deadlines for filing administrative claims.

MESA AIR GROUP: Wellington Management Reports Holdings
Wellington Management Company, LLP, in its capacity as investment
adviser, beneficially owns 929,400 shares of the common stock of
Mesa Air Group Inc. over which it exercises shared voting power,
and 2,161,100 shares over which it has shared dispositive power.  
The shares are held of record for the clients of Wellington and
represent 6.39% of the outstanding common stock of Mesa Air

MONDI OF AMERICA: Seeks Extension To Assume/Reject Leases
The debtors, Mondi of America, Inc. and its debtor affiliates
seek an order extending the period within which the debtors may
assume or reject unexpired leases of nonresidential real property
to and including March 31, 2000.  A blanket extension of the
period with respect to all of the debtor's remaining leases is
reasonable, according to the debtor, in view of the fact that
most of the store closing sales have only recently concluded and
the complex nature of these cases.  The debtors believe that the
additional time will allow the debtors to wind up any ongoing
store closings at the certain of these remaining store locations
and, thereafter, assume and assign, or reject the underlying

NEW WORLD COFFEE: FMR Corp and Johnson No Longer Hold Stock
New World Coffee Manhattan Bagel Inc. announces that FMR Corp.,
Edward C. Johnson 3d and Abigail P. Johnson no longer hold stock
in the company, having divested themselves of their former

PARAGON TRADE BRANDS: Exits Chapter 11 - Report To SEC
Paragon Trade Brands, Inc. has exited Chapter 11 and investors
led by Wellspring Capital Management LLC have purchased the
company in accordance with Paragon's Modified Second Amended Plan
of Reorganization.  The Plan was previously confirmed by the
United States Bankruptcy Court for the Northern District of
Georgia. It provides for the surrender of the outstanding equity
shares of Paragon, the settlement of all outstanding
claims against the company and a recapitalization of the company.

Under the Plan, Wellspring purchased approximately 97% of the new
common stock of the company for approximately $115 million cash
with the balance of the new common stock going to former
shareholders, along with warrants to purchase up to 5% of the new
common stock.  In addition, the company issued $146 million in
11.25% Senior Subordinated Notes due 2005 and established a $95
million three-year, secured credit facility with Citicorp USA,
Inc., as Administrative Agent.  Creditors of the company will
receive,  pursuant to the Plan, a pro rata share of the purchase
price invested by Wellspring and a pro rata share of the $146
million Senior Subordinated  Notes.  The Plan also provides that
the creditors and former shareholders will share in the proceeds,
if any, of certain litigation claims that will remain with the
estate and be prosecuted by a Litigation Claims Representative
appointed under the Plan and supported by separate funding
provided for under the Plan.

Commenting on the closing of the Wellspring Transaction and
Paragon's exit from Chapter 11, Bobby Abraham, Chief Executive
Officer of Paragon, stated, "The closing of the Wellspring
Transaction and our emergence from Chapter 11 marks the beginning
of a positive new chapter for Paragon. Without the distractions
of Chapter 11, Paragon can better focus on serving the needs
of its customers with new and improved products and marketing
initiatives. The solid capital structure provided by the
Wellspring Transaction will allow us to achieve our goals for
sales growth and product innovations on an accelerated basis."

Wellspring Capital Management Partner, David Mariano, further
noted, "Our investment in Paragon is consistent with our strategy
of investing in companies where there is the opportunity for
substantial value creation. In line with that strategy, we have
worked closely with Paragon's financial and legal team to create
a financial structure that will allow the company to fund all of
its product development and marketing programs while at the
same time maximizing operating efficiencies.  Given the combined
strengths of the recapitalized company and the continuity of
experience provided by Paragon's management we are confident that
Paragon is on the path to successful growth and profitability."

Paragon Trade Brands is the leading manufacturer of store brand
infant disposable diapers in the United States and, through its
wholly owned subsidiary, Paragon Trade Brands (Canada) Inc., is
the leading marketer of store brand infant disposable diapers in
Canada.  Paragon manufactures a line of premium and economy
diapers, training pants, feminine care and adult incontinence
products, which are distributed throughout the United
States and Canada, primarily through grocery and food stores,
mass merchandisers, warehouse clubs, toy stores and drug stores
that market the products under their own store brand names.  
Paragon has also established international joint ventures in
Mexico, Argentina, Brazil and China for the sale of infant
disposable diapers and other absorbent personal care products.

SERVICE MERCHANDISE: Announces 1999 Results and Business Plan
Service Merchandise Company, Inc. (OTCBB:SVCDQ) reported EBITDAR
(earnings before interest, taxes, depreciation, amortization and
restructuring charges) from continuing operations of $25.2
million for the year ended January 2, 2000. EBITDAR from
continuing operations for the three months ended January 2, 2000
was $68.3 million compared to$49.1 million for the prior year
fourth quarter. EBITDAR from continuing operations for the nine
months ended encompassing reporting periods following the
commencement of the Company's voluntary Chapter 11 case on was
$47.6 million, exceeding the Company's 1999 Stabilization Plan by
$ 12.6 million, or 36.1 percent.

As key components of its 2000 Business Plan, Service Merchandise
also announced strategic initiatives involving the refinement of
its product mix with a heightened focus on jewelry and a more
targeted assortment of hardlines, and a convergence of its store
selling environments and established Internet structure.  The
Company's 2000 Business Plan also includes initiatives designed
to maximize the value in the Company's real estate holdings.

To fund its 2000 Business Plan as well as future operations, and
in anticipation of emergence from Chapter 11 in 2001, the Company
has obtained a fully underwritten commitment from Fleet Retail
Finance Inc., the co-agent under the Company's current $750
million debtor-in-possession (DIP) financing facility, for a new
four-year$600 million credit facility. This new facility will
replace the existing DIP financing and includes a commitment for
exit financing post-reorganization.

In connection with the completion of its independent audit for
the year ended January 2, 2000, the Company announced a net loss
of $243.7 million, or $2.45 per common share, for the fiscal
year, on net sales of $2.23 billion. For the prior year, the
Company reported a net loss of $110.3 million, or $1.11 per
common share, on net sales of$3.17 billion. For the 13 weeks
ended January 2, 2000, the Company reported net income of $28.0
million, or $.28 per share, on net sales of $835.7 million, as
compared with a net loss of $41.8 million, or a loss of $.42
per share, on net sales of $1.29 billion for the 14 weeks ended
January 3, 1999.

An important element of the Company's strategy is the convergence
of the Internet and store selling environments. Each Service
Merchandise store will feature Internet kiosks that will provide
immediate access to the Company's web site,, its bridal and gift registry, and its
store directory. Using the in-store Internet kiosks, customers
will be able to purchase and pick up merchandise from the store
or have it delivered to their homes. The Company also expects to
enter into additional vendor partnerships similar to its recently
announced alliances with brands such as Corning, Black and Decker
and Panasonic Home. Under these alliances, Service Merchandise
plans to offer a portion of each company's product line in its
stores and the entire product line via the Internet. The Company
is working to establish a system to offer the hardlines
categories which will no longer be carried in stores for
purchase via the Internet based on vendor ability to ship
directly to consumers.

The Company said that the 2000 Business Plan was the next step in
the strategic reorganization timeline established by the Company
and announced to creditors, shareholders, landlords, employees
and other interested parties at the outset of its Chapter 11
reorganization cases last year. The Company said that, after
successfully completing the Company's stabilization plan during
1999, the 2000 Business Plan, if also successfully implemented,
should provide the framework for a plan of reorganization to be
proposed, filed, prosecuted, confirmed and consummated by the
Company during 2001. The Company said that the plan or plans of
reorganization presently being considered by the Company
involve a debt conversion of the Company's prepetition unsecured
claims into new common equity of the reorganized company. Under
such circumstances, the existing common stock of the Company
would be cancelled and existing shareholders would not receive
any distribution in connection with the reorganization. The
Company said that the value of its common stock was highly
speculative since it was highly probable that it would be
cancelled and therefore worthless if the expected plan of
reorganization is consummated.

Following the expected approval of the Bankruptcy Court and
closing, the Company's new four-year, $600 million DIP and exit
credit facility will replace the Company's existing $750 million
DIP financing agreement and is expected to provide adequate DIP
financing as well as exit financing for ongoing capital
improvements, operating expenses and general working capital once
the Company emerges from Chapter 11. The new facility will be
agented by Fleet Retail Finance Inc., a co-agent of the current
DIP facility, and fully underwritten by FleetBoston Robertson
Stephens Inc. "We are very supportive of the Company and its 2000
Business Plan. We look forward to working with Service
Merchandise as it implements its Plan and successfully emerges
from Chapter 11," said Ward Mooney, President of Fleet Retail

The new credit facility is presently structured as a $600 million
revolver, although Fleet has reserved the right to allocate up to
$85 million to a term loan prior to closing. The facility also
includes a letter of credit subfacility of $150 million and
permits subordinated secured financing in amounts up to an
additional $50 million on terms reasonably satisfactory to Fleet.
The facility requires superpriority claim status and a first
priority security interest in all assets subject to existing
liens, and contains certain other customary priority provisions.

The financing is subject to various customary terms and
conditions, and must be closed by the Company no later than May
31, 2000. The facility will mature four years from closing but
can be converted to exit financing by the Company at
any time during the four-year term as long as applicable
conditions to conversion are satisfied. The interest rate during
the first year of the term is LIBOR plus 250 basis points or
prime plus 75 basis points; thereafter, the interest rate on the
facility is subject to quarterly adjustment pursuant to a pricing
grid based on availability and/or EBITDA with ranges of 200 to
275 basis points over LIBOR and 25 to 100 basis points over

The borrowing base under the facility is substantially similar to
the Company's existing $750 million DIP facility except for
increases in certain seasonal advance rates and total
availability based on real estate holdings. The facility has no
mandatory commitment reductions or mandatory prepayments except,
prior to exit from Chapter 11, the facility includes a daily
sweep of cash towards the revolver balance (subject to certain
exceptions). Following exit from Chapter 11, the daily sweep
would occur only during specified cash dominion events.

The facility includes various covenants designed to facilitate
implementation of the 2000 Business Plan and the Company's
anticipated emergence from Chapter 11 in 2001. To fund capital
expenditures, including the Company's planned two-year store
renovation program, the proposed facility will permit the Company
to invest up to $70 million of capital expenditures during 2000
(plus certain incremental amounts based on the amount of
subleased space completed during the fiscal year). In 2001, the
facility will permit capital expenditures up to $150 million less
actual capital expenditures invested during 2000. During 2002 and
2003, the Company may invest up to $50 million each year with 100
percent carry over of unexpended amounts from prior years. The
facility will include a financial covenant test similar to the
test in the current $750 million DIP facility. The Company would
not breach this financial covenant unless unused borrowing
availability falls below $50 million and the Company fails to
meet specified minimum EBITDAR performance. Excluded from the
EBITDAR calculation are revenues and expenses associated with
discontinued inventory lines, the Orlando and Montgomery
warehouses and the reduction in force plan (including payroll and
severance) except with respect to non-continuing EBITDAR amounts
in excess of $ 100 million.

There are no restrictions in the facility on the Company's
ability to sublease and lease store space pursuant to the 2000
Business Plan; lease all or part of the corporate headquarters;
sell, pursuant to sale-leasebacks or outright, the corporate
headquarters, the Orlando and/or the Montgomery distribution
centers; and/or implement a credit card receivables
securitization program. The Company also retains the ability to
complete intercompany restructurings, intercompany asset
transfers and intercompany/third-party real estate transactions.

Events of default under the facility include customary default
provisions as well as key management provisions that would
trigger a default in the event that both the current CEO and
President ceased to be employed, unless at least one of
them is replaced by a person reasonably satisfactory to Fleet
within 90 days and/or the acquisition by any one person or entity
of 50 percent of the voting stock of the company. Closing of the
proposed facility is subject to customary closing conditions,
including at least $155 million of availability at close and
no material adverse change at the time of closing. Conversion of
the DIP Facility to an exit facility is also based on customary
closing conditions, including the Agent's reasonable satisfaction
with capital structure, plan of reorganization and any materially
revised projections, as well as the achievement by the Company of
a specified trailing 12-month EBITDA (which varies depending on
time of exit) and certain minimum availability (which varies from
$ 50 to $100 million) depending on the time of exit.

"With our new financing commitment and with the Court's approval
earlier this month of our exclusive right to propose a
reorganization plan through April 2001, the Company's 2000
Business Plan should serve as the basis for the creation of
Service Merchandise's reorganization plan and emergence from
Chapter 11 in 2001," Mr. Cusano said. The Company said that it
will file the commitment letter agreed to between Fleet and the
Company as an exhibit to a filing on Form 8-K with the Securities
and Exchange Commission.

Service Merchandise and its subsidiaries filed voluntary
petitions for reorganization under Chapter 11 in the U.S.
Bankruptcy Court for the Middle District of Tennessee in
Nashville on March 27, 1999.

Service Merchandise Company, Inc. operates 221 stores in 32
states. Customers may also shop by phone at 800-JEWELRY and on
the web at

SERVICE MERCHANDISE: Second Motion To Extend Exclusivity
The 1999 Holiday Selling Season is over and Service Merchandise
believes it will see results consistent with its 1999
Stabilization Plan.  During 2000, the Debtors are set to put
their Business Plan into action.  With that in mind, until the
2000 Holiday Selling Season is completed, the Debtors are
in a position where they cannot propose a credible plan of
reorganization until early to mid-2001.  Accordingly, the Debtors
ask the Court, pursuant to 11 U.S.C. Sec. 1121, to extend their
exclusive period within which to file a plan of reorganization
through April 30, 2001, and grant a concomitant extension of
their exclusive period during which to solicit acceptances of
that plan through June 30, 2001.  

The length of this extension is without precedent, observe
Contrarian Capital Management, LLC, Touchstone Capital, LLC and
Varde Partners, holders of approximately $65 million of 9% Senior
Subordinated Notes and $18 million of trade claims.  A 14 month
extension of exclusive periods to file and obtain acceptances of
a plan of reorganization is contrary to the purpose of Bankruptcy
Code Sec. 1121, the Noteholders charge.  

The Noteholders believe that the Debtors' financial performance
in Chapter 11 underscores the dangers of giving them a lengthy
exclusivity extension. The Noteholders note that a formal
discovery and a hearing are necessary to understand issues, which
will not be possible until the Debtors have released their
audited financials for 1999 and their Business Plan for 2000
-- both scheduled to be in March 2000.

The Noteholders point out that in a bid to obtain the support of
the Official Creditors' Committee, the Debtors propose to give
the Committee a special say in future exclusivity disputes,
offering the Committee, and no one else, the opportunity to
examine the Debtor's Business Plan in March 2000 and, if the
Committee chooses, to require the Debtors to justify
continued exclusivity on May 2.  The Noteholders find this a
novel device which would divest the Court of a crucial portion of
its supervisory responsibilities over these cases, as well as
divesting the key constituencies of their right to be heard on
exclusivity matters.  The Noteholders point-out that even the
Debtors themselves acknowledge the reasonableness of the
Committee's insistence on seeing that information before
committing to continued exclusivity.

The Noteholders conclude that given the importance to all parties
of reviewing the Debtors' 1999 final results and 2000 Business
Plan, which are expected to be available in the next two months,
the Debtors' exclusive right to file a plan should be extended
only to the May 2, 2000 hearing.

The Bank of New York, as successor to First American National
Bank, acting as the Indenture Trustee with respect to the
$300,000,000 of 9% Senior Subordinated Debentures Due 2004 lends
its helping hand to the Noteholders, focusing the Court's
attention on procedural and due process issues.

Although it is still in the process of finalizing its December
results and annual audit, the Company provided the Court with
preliminary 1999 results. Those results, as subsequently refined,
indicate gross EBITDAR (earnings before interest, taxes,
depreciation, amortization and restructuring charges) of
approximately $62 million for the nine months ended exceeding
its 1999 Business Plan by $19 million or 44 percent -- based on
preliminary financial information.

Since the commencement of the Company's voluntary Chapter 11 case
in March 1999, Service Merchandise says it continues to make
significant progress in its restructuring initiatives:

-- Vendor support has improved significantly. Substantially all
jewelry vendors and more than 60 percent of hardlines vendors are
now extending payment terms to the Company, and the extension of
exclusivity is expected to help to continue vendor support
throughout the 2000 retail cycle.

-- Customer relations improved through the refocusing of the
stores' merchandise mix, the reestablishment of a private label
credit card program and the reduction of out-of-stock occurrences
from 14 percent at the commencement of the Chapter 11 case to 2
percent at the onset of the 1999 holiday season.

-- Beginning in March 1999, 122 underperforming stores were
closed. Inventory liquidation sales at those locations surpassed
projections, generating approximately $100 million in net

-- The Company sold its interests in 76 previously-closed store
locations and other surplus real estate properties throughout the
country to various retail chains, real estate developers and
landlords, generating more than $76 million of net cash proceeds.
Service Merchandise also divested its B.A. Pargh Company, Inc.
subsidiary, resulting in approximately $8 million in net

-- During 1999, the Company reduced its corporate workforce by
some 250 positions and closed two distribution centers and five
regional jewelry repair centers to adjust the cost structure to
correspond with the existing store base, resulting in annualized
savings of $25 million.

-- Liquidity remains strong. Throughout the critical fall season,
liquidity remained very strong, with minimum availability of $150
million at peak inventory and maximum excess availability of more
than $400 million.

"While much hard work remains ahead, based on the Company's
achievements during 1999, we believe Service Merchandise is well-
positioned to move forward in developing a foundation for the
completion of its restructuring and its exit from Chapter 11
early next year," CEO Sam Mr. Cusano said.

Following extensive evidentiary hearings, Judge Paine found that
the traditional factors used by bankruptcy courts to evaluate a
debtor's entitlement to an extension of its exclusive periods are
met in these cases.  The case is large and complex, it will take
time to negotiate and prepare adequate information, there is
evidence of good faith progress toward reorganization, post-
petition obligations are being honored, there are prospects for
the filing of a viable plan, negotiation is on-going,
and, among other things, the Debtors are not seeing the
extensions to improperly pressure their creditors.  

Leading the evidentiary challenge, Janice Stanton of Contrarian
told Judge Paine how the Debtors are "hemorrhaging cash," and
projected EBITDAR figures thrown around in the Business Plan are
misleading because they overlook restructuring and non-recurring
costs.  Contrarian calculates that some $40,000,000 of cash was
spent in 1999 that the Debtors don't account for in announcing
on-plan results.  

Finding David Resnick of Peter J. Solomon Company, Ltd., to be a
"highly persuasive and credible witness," and his counter-
explanation of Service Merchandise's financial health to be
"helpful," Judge Paine held that the evidence shows that Service
Merchandise is making progress toward being able to propose a
viable reorganization plan.  

As to all creditors and parties in interest, except the
Committee, the Noteholders and BNY, Judge Paine ruled that the
Debtors' exclusive periods shall be extended as requested.  
Following the release of final financial reports for 1999, the
Committee and the Noteholders may file motions to reduce the
Debtors' exclusive periods by April 3, 2000, and the Court will
entertain those motions at a hearing on May 2, 2000.  (Service
MErchandise Bankruptcy News Issue 10; Bankruptcy Creditors'
Service Inc.)

SUCCESS MULTIMEDIA: Plan and Disclosure Statement
On January 31, 2000, the debtors filed their Liquidating Plan of
Reorganization. The bankruptcy court has scheduled a hearing to
be held on March 9, 2000 at 10:000 AM to consider whether an
order should be entered approving the Disclosure Statement and
authorizing the debtor to solicit acceptances of the plan.

SUCCESS MULTIMEDIA: Last Date For Filing Proofs of Claims
On February 14, 2000, the US Bankruptcy Court for the southern
District of New York entered an order setting March 29, 2000 as
the last date upon which any party that has not already done so
may file a proof of claim against Success Multimedia Enterprises,
Inc. and its affiliates.

TAESA: Mexico's Airline Declared Bankrupt
On Monday, a bankruptcy court judge declared Mexico's Taesa
airline, the country's third largest, officially bankrupt,
according to Reuters. The airline, which had been grounded since
a November crash that killed 18 crew members and passengers, had
sought to suspend payments on its nearly $400 million in debt
earlier this month, but the judge rejected the petition.
Attorneys working on the case said that Taesa, which had $60
million in assets, did not have the means to pay its creditors.

TITAN INTERNATIONAL: United Steelworkers Berate Taylor
The United Steelworkers of America today issued the following:

The United Steelworkers of America (USWA) Dept. of Strategic
Projects released a searing, detailed and comprehensive 43-page
report titled "Bad for Business" last week outlining the
disastrous financial and legal situation of Titan International
Inc. (NYSE: TWI) -- based in Quincy, Ill. (The report is also
available in an 11-page summary version).

Titan International Inc. produces agricultural, off-road and
construction tires, wheels and assemblies.  It is a company that
only two years ago inspired hope of high profitability.  Then it
forced two USWA Local unions -- in Des Moines, Iowa and Natchez,
Miss. -- into Unfair Labor Practice (ULP) strikes. Today, it
plummets toward disaster.

Titan's CEO, Morry Taylor, is both the captain of the ship that
workers have named the "Titanic" and the primary cause of Titan's
sinking fortunes. Though he ceaselessly hypes himself as an
entrepreneurial success, Taylor is almost singularly responsible
for Titan's numerous woes.  His reckless management style has
resulted in:

-- Two major labor disputes and bitter labor relations at all
Titan facilities;

-- Significant omissions in SEC filings;

-- A spate of lawsuits and labor law violations with potential
liabilities running into tens of millions (possibly hundreds of
millions) of dollars;

-- Repeated failed start-ups of new products and companies;

-- Cannibalization of Titan subsidiaries to keep the parent
company afloat;

-- Consistent misrepresentations to cover up Titan's plummeting

-- Tens of millions of lost profit dollars and hundreds of
millions of lost equity;

-- Countless broken promises to the company's stakeholders; and

-- Business dealings with two associates separately named in
press reports and by federal agencies as a 'mob associate' and a
'money launderer.'

The report -- employing Securities and Exchange Commission
reports, documents acquired from various state and federal
regulatory agencies, court records, legal briefs, eyewitness
testimony, financial statements and published news reports from
the United States and abroad -- carefully describes Taylor's
abuses, mistakes, and persistent violations of labor law,
workplace safety regulations, environmental laws -- and lack of
sound business ethics.

In all, it paints a picture of rapidly growing risks for both
investors and other stakeholders in the company including
workers, taxpayers, lenders, customers and suppliers.

"We have been struggling with Taylor and his managers since they
first took our plant over in 1993," said John Peno, President of
the 670-member USWA Local 164 of Des Moines, Iowa.  "It's been
everything from the most basic of health and safety conditions,
to abuse of work rules, to massive forced overtime, to
insurance for our retirees, to the way they treat us as human
beings.  Two workers have died in our plant since Titan took
over, and there have been numerous serious injuries as well."

"On May 1, 1998, they illegally forced us into a ULP strike and
essentially, Taylor and Titan have failed to bargain in good
faith for nearly a year.  In retrospect, it now seems clear that
they have brought this company to the brink of financial ruin
because they want to deunionize the entire operation."

"If you look closely at the numbers, the situation is critical,"
added Leo "T-Bone" Bradley, President of USWA Local 303L of
Natchez, Miss.  Titan Tire Corp. of Natchez illegally forced 300
Local 303L members into a ULP strike on Sept. 14, 1998, in a
complex bankruptcy scheme that is typical of a Taylor-run
operation.  "The 1999 final financial numbers will be out any day
now and they will show exactly how bad off this company is.

"For two years, 1000 USWA families have borne the brunt of
Taylor's abuses and excesses.  But now, it has become absolutely
clear that all stakeholders stand to lose in the communities
which Taylor and Titan have polluted with toxic wastes and even
more toxic business practices.

"That is why the USWA is saying quite clearly and directly: 'If
Morry Taylor and Titan's current crop of managers are unwilling
and unable to manage this corporation in an efficient, effective,
profitable and humane manner, then they should get out of the way
and turn the reigns over to a management group that is competent
-- even if that means selling the company to new owners.'"

TURBODYNE: Updates On The Sale Of Its Light Metals Division
Turbodyne Technologies Inc. (EASDAQ:TRBD) announces the following
update on the bankruptcy sale of substantially all of the assets
of its subsidiaries, Pacific Baja Light Metals Corp., Baja
Pacific Light Metals Inc. and Optima Wheel Inc. (the "Debtors").

On December 14, 1999, the Bankruptcy Court entered an order
authorizing the sale of substantially all of the assets of the
Debtors to an assignee of Hawthorne Partners (the "Buyer") for a
combination of cash and other consideration totalling
approximately $14.4 million. Wells Fargo Bank, which had
a financing agreement with the Debtors, had earlier announced
that it would discontinue the financing by December 31, 1999, if
no sale was forthcoming. The Debtors had advised the Court that
no other source of financing was available to the Debtors. In
addition, certain of the Debtors' most significant customers had
announced that they would withdraw their business if a sale of
assets was not consummated by December 31, 1999. Based on the
foregoing and the absence of any other bona fide offers, the
Bankruptcy Court accepted the Buyer's offer and approved the

The purchase price of up to $14.4 million included the assumption
of certain liabilities of the Debtors and a cash payment to Wells
Fargo Bank. Wells Fargo Bank received $7.9 million towards monies
that it was owed and waived approximately $900,000.00 of its
claim. The amount waived will go toward the monies available for
the unsecured creditors of the Debtors. In addition, one
supplier waived a $1.2 million claim for post-petition raw
material advances.

Under the Bankruptcy Court approved sale, the Debtors are
responsible for all amounts currently due under leases which are
being assumed by and assigned to the Buyer. In addition, one real
estate lease was rejected by the Buyer and retained by the
Debtors. This real estate lease leaves Turbodyne as a guarantor
on the lease, and responsible for lease payments of approximately
$19,500.00 per month until May 31, 2009. Turbodyne is attempting
to reduce these ongoing lease obligations by seeking a sublessee.

While most of the equipment leases of the Debtors have been
assumed by the Buyer and, accordingly, the Debtors and Turbodyne,
as guarantor, are no longer obligated thereon, certain of the
leases have not yet been assumed or have been rejected by the
Buyer and their ultimate resolution remains with the Court.
Turbodyne currently is not able to determine the amount of
liability, if any, that it will have with respect to these
equipment leases. In addition, there is a claim against Turbodyne
for $1.8 million from a former vendor of the Debtors
who alleges that Turbodyne is a guarantor on this debt.

Turbodyne Technologies Inc., a California based high technology
company, specializes in the development of performance
enhancement, fuel economy and pollution control products for
internal combustion engines. Turbodyne Technologies Inc.'s
headquarters is located in Carpinteria, Calif.; the European
business location is Frankfurt, Germany. Additional information
about the company is available on the Internet at

UNITED KENO HILL MINES: Applies For Protection Under CCAA
United Keno Hill Mines Limited announced that it has applied to
the Superior Court of Ontario (the "Court") and has been granted
protection from its creditors pursuant to an Order made in
Toronto under the Companies' Creditors Arrangement Act ("CCAA")
on February 18, 2000. The Order, which may be extended by the
Court, stays all proceedings against the Company for an initial
period terminating on March 16, 2000.

Recently, the Company has been engaged in court proceedings in
Whitehorse, Yukon where a group of creditors holding miners'
liens is attempting to sell the Company's silver properties at
Elsa, Yukon. The stay of proceedings granted in the Order will
create a level playing field in which the interests of all
stakeholders of United Keno will be considered and will
allow the Company to negotiate with all its stakeholders in order
to develop a completely restructured company.

United Keno also announced that it has entered into a financing
agreement with Pacific Cart Services Ltd., a Nevada corporation
("PCS"). The agreement contemplates PCS providing and assisting
the Company in arranging the working capital and construction
capital needed by United Keno to complete pre-production
rehabilitation and underground development at United Keno's
mines and mill at Elsa, Yukon and to provide for its working
capital requirements until such time as commercial production is
resumed. PCS has agreed to lend United Keno an initial $150,000
(on the basis of a loan convertible into common shares of the
Corporation at $0.09 per share) with the option to advance up to
a further $4,000,000 on a similar basis, and is in advanced
discussions with a third party financier concerning the balance.

The proposed financings are subject to the approval of regulatory
authorities and the Court.

Meetings, Conferences and Seminars
February 24-26, 2000
      Chapter 11 Business Reorganizations
         Walt Disney World, Orland, Florida
            Contact: 1-800-CLE-NEWS

February 27-March 1, 2000
      Norton Bankruptcy Litigation Institute I
         Olympic Park Hotel, Park City, Utah
            Contact: 1-770-535-7722

March 2-5, 2000
      1st Annual Winter Conference
         Radisson Resort Hotel, Scottsdale, Arizona
            Contact: 1-561-241-7301 or 1-213-487-7550

March 8-10, 2000
      Healthcare Restructurings: Successful Strategies
      for Managing Distressed Finances
         The Regal Knickerbocker Hotel, Chicago, Illinois
            Contact: 1-903-592-5169 or   
March 10, 2000
      Bankruptcy Battleground West
         Century Plaza Hotel. Los Angeles, California
            Contact: 1-703-739-0800

March 10 & 11, 2000
      Spring Seminar
         Hotel Monteleone, New Orleans, Louisiana
            Contact: 1-803-252-5646 or

March 23-25, 2000
      26th Annual Southeastern Bankruptcy Law Institute
         Marriott Marquis Hotel, Atlanta, Georgia
            Contact: 1-770-451-4448

March 23-25, 2000
      Partnerships, LLCs, and LLPs -- Uniform Acts,
      Taxation, Drafting, Securities and Bankruptcy
         Doubletree Paradise Valley Hotel,
         Scottsdale, Arizona
            Contact: 1-800-CLE-NEWS

March 30-April 2, 2000
      Norton Bankruptcy Litigation Institute II
         Flamingo Hilton Hotel, Las Vegas, Nevada
            Contact: 1-770-535-7722

April 3-4, 2000
      22nd Annual Current Developments in
      Bankruptcy and Reorganization Conference
         PLI Conference Center, New York, New York
            Contact: 1-800-260-4PLI

April 5-8, 2000
      Spring Meeting
         The Pointe Hilton Squaw Peak Resort
         Phoenix, Arizona
            Contact: 1-312-822-9700 or
April 6-7, 2000
      Commercial Securitization for Real Estate Lawyers
         Walt Disney World, Orlando, Florida
            Contact: 1-800-CLE-NEWS

April 10-11, 2000
      22nd Annual Current Developments in
      Bankruptcy and Reoorganization Conference
         Grand Hyatt Hotel, San Francisco, California
            Contact: 1-800-260-4PLI

April 27-30, 2000
      Annual Spring Meeting
         J.W. Marriott, Washington, D.C.
            Contact: 1-703-739-0800

May 4-5, 2000
      Bankruptcy Sales & Acquisitions
         The Renaissance Stanford Court Hotel
         San Francisco, California
            Contact: 1-903-592-5169 or   

May 15, 2000
      2nd Annual New York City Bankruptcy Conference
         Association of the Bar of the City of New York,
         New York, New York
            Contact: 1-703-739-0800

May 26-29, 2000
      52nd Annual Meeting of the New England Region
         Colony Hotel, Kinnebunkport, Maine
            Contact: 1-617-742-1500 or

June 8-11, 2000
      7th Annual Central States Bankruptcy Workshop
         Grand Traverse Resort, Traverse City, Michigan
            Contact: 1-703-739-0800
June 14-17, 2000
      16th Annual Bankruptcy and Restructuring Conference
         Swissotel, Chicago, Illinois
            Contact: 1-541-858-1665 or

June 29-July 2, 2000
      Western Mountains Bankruptcy Law Institute
         Jackson Lake Lodge, Jackson Hole, Wyoming
            Contact: 1-770-535-7722

July 13-16, 2000
      7th Annual Northeast Bankruptcy Conference
         Doubletree Hotel, Newport, Rhode Island
            Contact: 1-703-739-0800
July 21-24, 2000
   National Association of Chapter 13 Trustees
      Annual Seminar
         Adams Mark Hotel, St. Louis, Missouri
            Contact: 1-800-445-8629 or

August 3-5, 2000
      Fundamentals of Bankruptcy Law
         Somewhere in Boston, Massachusetts
            Contact: 1-800-CLE-NEWS

August 9-12, 2000
      5th Annual Southeast Bankruptcy Workshop
         Hyatt Regency, Hilton Head Island, South Carolina
            Contact: 1-703-739-0800

August 14-15, 2000
      Advanced Education Workshop
         Loews Vanderbilt Plaza, Nashville, Tennessee
            Contact: 1-312-822-9700 or
September 12-17, 2000
         Doubletree Resort, Montery, California
            Contact: 1-803-252-5646 or

September 15-16, 2000
      Views From the Bench 2000
         Georgetown University Law Center, Washington, D.C.
            Contact: 1-703-739-0800

September 21-22, 2000
      3rd Annual Conference on Corporate Reorganizations
         The Regal Knickerbocker Hotel, Chicago, Illinois
            Contact: 1-903-592-5169 or   

September 21-23, 2000
      Litigation Skills Symposium
         Emory University School of Law, Atlanta, Georgia
            Contact: 1-703-739-0800

September 21-24, 2000
      8th Annual Southwest Bankruptcy Conference
         The Four Seasons, Las Vegas, Nevada
            Contact: 1-703-739-0800

November 2-6, 2000
      Annual Conference
         Hyatt Regency, Baltimore, Maryland
            Contact: 312-822-9700 or

November 30-December 2, 2000
      Winter Leadership Conference
         Camelback Inn, Scottsdale, Arizona
            Contact: 1-703-739-0800

The Meetings, Conferences and Seminars column appears
in the TCR each Tuesday.  Submissions via e-mail to are encouraged.  


S U B S C R I P T I O N   I N F O R M A T I O N
Troubled Company Reporter is a daily newsletter, co-published
by Bankruptcy Creditors' Service, Inc., Trenton, NJ, and Beard
Group, Inc., Washington, DC. Debra Brennan, Yvonne L. Metzler,
Edem Alfeche and Ronald Ladia, Editors.

Copyright 2000.  All rights reserved.  ISSN 1520-9474.

This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without
prior written permission of the publishers.  Information
contained herein is obtained from sources believed to be
reliable, but is not guaranteed.

The TCR subscription rate is $575 for six months delivered via
e-mail. Additional e-mail subscriptions for members of the same
firm for the term of the initial subscription or balance thereof
are $25 each. For subscription information, contact Christopher
Beard at 301/951-6400.

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