TCR_Public/000324.MBX   T R O U B L E D   C O M P A N Y   R E P O R T E R

     Friday, March 24, 2000, Vol. 4, No. 59  

ACME METALS: Seeks To Retain Ungaretti & Harris
AMERICAN HEALTH: Illinois HMO Suspended From Conducting Business
CLARIDGE HOTEL: Files Amendment to Joint Plan of Reorganization
COHO ENERGY: Modifications to Plan and Changes in CEO
CROWN VANTAGE: Closes on First Installment of DIP Financing

CWT SPECIALTY: Seeks To Reject Three Leases
DAEWOO MOTOR: Hyundai to evaluate assets
DFG ITALIA: Trustee Appointed to Investigate California Firm
FRUIT OF THE LOOM: Class Action Suit Filed Against Top Officers
FUJI CORP: Inventory Reduced 37%

HARNISCHFEGER: Key Employee Retention Program
HARNISCHFEGER: Taps The Blackstone Group
INCOMNET: Debtors Respond To Comments of US Trustee
KCS ENERGY: Reports Fourth Quarter and Full Year 1999 Results
MARINER: Announces Executive Management Changes

MEDPARTNERS: Seeks To Extend Time To Assume/Reject Leases
MICHAEL PETROLEUM: Order Authorizes Use of Cash Collateral
MITSUI MINING & SMELTING CO.: Speeds Up Debt Reduction
MTS INC: Moody's Lowers Ratings
OCELOT ENERGY: Changes Name and Moves to Jersey

PACIFIC INTERNATIONAL: Zaremba Group Agreement Approved By Court
PACIFIC NEVADA: Case Summary and Largest Unsecured Creditors
PHYSICIAN COMPUTER: Seeks Approval of Settlement Agreements
PRIMARY HEALTH SYSTEMS: Hospital Ordered Reopened
SHOE CORP: Seeks To Extend Time to Assume/Reject Leases
STAR NEWCO: Seeks Authority For Second Employee Severance Program


ACME METALS: Seeks To Retain Ungaretti & Harris
The Acme debtors seek to retain and employ Ungaretti & Harris as
special counsel  for advice on financial and securities matters.  
The debtors request that Ungaretti be retained to provide Acme
debtors advice with regard to the negotiation of a new secured
syndicated term loan facility, the proceeds of which are intended
to be used to pay down existing secured indebtedness, and
application of a guaranty of such term loan facility by the uS
government under the recently-enacted Emergency Steel Loan
Guaranty Program.  The debtors request that the retention be
effective as of January 20, 2000. The attorneys for the firm who
will be handli8ng this case charge current standard hourly rates
ranging from $155 per hour to $345 per hour.

AMERICAN HEALTH: Illinois HMO Suspended From Conducting Business
An Illinois-based health maintenance organization will stop doing
business in Arkansas as of March 31, the Arkansas Insurance
Department said.

Insurance Commissioner Mike Pickens said Wednesday the American
HMO/American Health Care Providers and the state Insurance
Department reached an agreement for the company to stop doing
business in the state.

Last month, the Illinois Department of Insurance filed a petition
for liquidation, alleging American Health Care Providers, the
parent company of American HMO, is financially insolvent.

The company's alleged financial troubles could affect about
90,000 customers, including 300 Arkansas residents, according to
Arkansas Insurance Department officials.

CLARIDGE HOTEL: Files Amendment to Joint Plan of Reorganization
Yesterday, The Claridge Hotel and Casino Corporation, its
wholly owned subsidiary, The Claridge at Park Place, Incorporated
and Atlantic City Boardwalk Associates, L.P. filed its First
Amended Joint Plan of Reorganization and First Amended Disclosure
Statement in the United States Bankruptcy Court in Camden, New
Jersey. Consistent with its Plan initially filed on January 27,
2000, the Plan proposed that the Partnership will transfer its
assets, which include, principally, the land, building and
furnishings of the Claridge Casino Hotel to the reorganized

The Plan provides for the holders of the Corporation's $85
million First Mortgage Notes to receive on a pro rata basis 100%
of the equity of the reorganized Claridge, outstanding on the
effective date of the Plan, and debt not to exceed $15 million in
the form of a new ten year secured Note carrying an 8% coupon

The Plan provides for unsecured creditors to be paid in six equal
installments over a five year period beginning on the effective
date of the Plan.  Total payments to unsecured creditors will not
exceed $5.5 million.

The Court plans to issue its opinion regarding the adequacy of
the Disclosure Statement, as amended, by mid-April.  Upon Court
approval of the Disclosure Statement, the Plan will be submitted
to creditors for a vote.

On August 16, 1999, The Claridge Hotel and Casino Corporation and
The Claridge at Park Place, Incorporated filed voluntary
petitions under Chapter 11 of the U.S. Bankruptcy Code in order
to facilitate a financial restructuring. On October 5, 1999,
Atlantic City Boardwalk Associates, L.P. filed a voluntary
petition under Chapter 11 of the U.S. Bankruptcy Code.  The
Claridge Hotel and Casino Corporation is a closely-held public
corporation and is the issuer of $85 million of 11-3/4% First
Mortgage Notes which are publicly traded on the New York Stock
Exchange under the symbol CLAR02.

COHO ENERGY: Modifications to Plan and Changes in CEO
Coho Energy, Inc. (OTCBB:COHO) announced on March 21, 2000 that
on March 20, 2000 the United States Bankruptcy Court for the
Northern District of Texas confirmed, with several modifications,
Coho's plan of reorganization.

The modifications to the plan include the retention by the common
shareholders as of Feb. 7, 2000 of 20% of any proceeds from
Coho's lawsuit against Hicks, Muse as well as 40% of any net sale
proceeds from the Company's Tunisia permit. The Company has also
announced a change in the number of shares to be outstanding
after the effectiveness of the plan. It had previously noted a
possible reverse stock split to proportionately reduce the number
of authorized and outstanding shares to help the Company satisfy
Nasdaq listing requirements. To more efficiently effect this
change, the Company amended its plan so that the change in
capitalization is effective as part of the plan of
reorganization. This change will entail the issuance of one share
of new common stock for each 40 shares of old common stock,
rather than the one-for-one exchange ratio previously planned.
The change will not affect the relative percentage ownership
interests among various groups of shareholders after the
effectiveness of the plan.

In addition to the modifications to the plan of reorganization
the Company also announced that its President and Chief Executive
Officer, Jeffrey Clarke, is expected to resign concurrently with
the effectiveness of the Company's confirmed plan of
reorganization. At that time, Mike McGovern, currently a Managing
Director of Pembrook Capital Corporation and formerly the
Chairman and Chief Executive Officer of Edisto Resources
Corporation, is expected to be elected as the new President and
Chief Executive Officer. The change in chief executive officer
results from the request of the majority holders of the Company's
8 7/8% bonds and was not a decision taken by the current board of
directors. The plan entails the issuance of more than a majority
of the Company's stock to the bondholders. The confirmed plan,
its effectiveness, and the concomitant change in the Company's
management, is anticipated to occur on March 31.

CROWN VANTAGE: Closes on First Installment of DIP Financing
Crown Vantage, Cincinnati, announced yesterday that it closed on
the first installment of its debtor-in-possession (DIP) financing
in the amount of $50 million, according to a newswire report. On
March 16, the Bankruptcy Court for the Northern District of
California approved the company's access to the first installment
of the funding under its previously announced $100 million DIP
financing arranged with Morgan Guaranty Trust Co. of New York as
administrative agent. Crown Vantage is one of the world's leading
manufacturers of value-added papers for printing, publishing and
specialty packaging. (ABI 23-Mar-00)

CWT SPECIALTY: Seeks To Reject Three Leases
The debtor, CWT Specialty Stores, Inc. seeks court approval to
reject three leases covering stores located in Brookline, MA,
Hadley, MA and Laconnia, NH.

Gordon Brothers Retail Partners notified the debtor that going-
out-of-business sales at certain store locations including the
three referenced herein would end as of March 19, 2000 and that
the premises would be vacated.  The debtors have reviewed the
leases covering these three locations and determined that the
store locations can not contribute positive value to the debtor's

DAEWOO MOTOR: Hyundai to evaluate assets
To move ahead with its bid to take over ailing competitor
Daewoo Motor, Hyundai Motor plans to kick off an asset
evaluation of Daewoo Motor starting from as early as next

Hyundai, which is the nation's largest automaker, said
Tuesday that the two firms are fine-tuning the details of
the schedule for the asset evaluation. The Hyundai
subsidiary also said the asset evaluation would cover
Daewoo Motor's foreign affiliates and production plants.
(Digital Chosun  21-March-2000)

DFG ITALIA: Trustee Appointed to Investigate California Firm
Bankruptcy Judge John E. Ryan (C.D. Calif.) has approved
creditors' request to appoint a trustee to take control of DFJ
Italia, a defunct Orange County, Calif., investment firm managed
by two ex-convicts who allegedly lured clients with promises of
big returns, the Associated Press reported. Documents filed in
bankruptcy court allege that DFJ lured investors, including L.A.
Rams stars and Hollywood stars, by boasting that the firm had
ties to Italian royalty and connections to the European economic
community. A group of five investors filed claims Monday to force
the company into chapter 7, and Judge Ryan appointed Thomas H.
Casey as trustee to investigate. An attorney for the investors
said that there is not any evidence that the money was ever
placed in suitable or appropriate investments. Federal
investigators have been looking into DFJ for months amid charges
that the firm ran a pyramid scheme that paid off old investors
with money from new investors. (ABI 23-Mar-00)

FRUIT OF THE LOOM: Class Action Suit Filed Against Top Officers
Milberg Weiss announced yesterday that a class action suit has
been filed in the U.S. District Court for the Western District of
Kentucky on behalf of purchasers of Fruit of the Loom Inc. Class
A common stock during the period between Sept. 28, 1998 and Nov.
4, 1999, the class period. The complaint charges the company's
two top officers with violations of the Securities Exchange Act
of 1934 and that during the third and fourth quarter of 1998, the
company told investors that it was materially reducing levels of
finished goods and raw materials inventory by curtailing
production for several days in each of those quarters, and that
the company expected strong sales growth in 1999-2000. On April
21, 1999, Fruit of the Loom reported its first quarter 1999
results, including a loss of $.13 per share. The company then re-
forecast 1999 sales, projecting better results in the second half
of the year. In November, the company revealed a loss of $166.4
million, or $2.49 per share, for the third quarter of 1999. The
firm filing the suit said the loss was not only due to the
company's poor and out-of-control operations, but also a massive
$60 million write-off of over-valued and non-existent inventory,
a $20 million loss on cotton futures contracts and a $10 million
charge for a loss on a supply contract from a previously sold
facility. In December, Fruit of the Loom ran out of money and
filed chapter 11. (ABI 23-Mar-00)

FUJI CORP: Inventory Reduced 37%
Fuji Corp. (8860) expects to report real estate inventory
of about 22.1 billion yen as of March 31, down 37% or 12.8
billion yen from a year ago.

The midsize housing developer's inventory has fallen to
roughly half the 44.1 billion yen peak reported at the
September 1991 midterm. As a result, interest-bearing
liabilities are also expected to contract to about 23
billion yen as of the end of this fiscal year, compared
with the peak of 46.5 billion yen.

Fuji was carrying losses mainly on properties acquired up
to 1992. It has been selling properties at a loss until
now, but this fiscal year it will take a write-down of
about 4.2 billion yen on the value of remaining properties,
eliminating unrealized losses.

Anticipating interest rate increases, the developer also
plans to further reduce interest-bearing liabilities.
(Nikkei  22-March-2000)

HARNISCHFEGER: Key Employee Retention Program
The Debtors ask Judge Walsh to approve four changes to their Key
Employment Retention Program.

First, the Debtors want to define change of control for purposes
of the KERP in the same way that COC is defined in the Debtors'
current KERP agreements with some modifications in light of the
current "Chapter 11 environment."

Second, the Debtors want to add two employees to the list of
current employees with whom they may enter into COC agreements.

Third, the Debtors want to clarify their authority, and establish
procedures for the Debtors to identify employees covered under
the Stay/Emergence and Severance components of the KERP.

Fourth, the Debtors want approval of the Annual Incentive Plan
component of the KERP for fiscal year 2000.   

The Debtors argue that the first amendment is warranted because
they are unable to agree with the creditors' Committee on a new
definition of change of control.  While the Debtors and the
Committee agree "in principle on the definition," they have not
agreed "on the exact language of the definition." The Debtors'
proposed language is similar to their prepetition agreements, but
adds a lengthy paragraph specifically dealing with confirmation
of a reorganization plan in Bankruptcy.

The second amendment is necessary because the Debtors want to add
two employees to their COC agreement list: Alan Jordan, Senior
Vice-President of the Rolls Division of Beloit; and Bob Harrison,
Senior Vice-President of the Pulping Division of Beloit.  The
Debtors assert that both of these employees are essential to the
divestiture of Beloit, but were inadvertently left off the list
of current employees with whom they are permitted to enter into
COC agreements.  The Creditors' Committee agrees to this

The third amendment is necessary to confirm the Debtors'
authority to change from time to time the employees who may be
covered under the Stay/Emergence and Severance components of the
KERP. The debtors will notify the Committee ten days before they
implement any such changes.  

The fourth amendment is necessary because the Debtors and the
Committee do not agree on the exact performance goals and
compensation percentages that can be awarded under the KERP's
Annual Incentive Plan.

The Debtors' proposed amendment provides a formula that specifies
the exact percentage of the covered employees' salary that can be
awarded as a bonus if the Debtors achieve specified financial
goals. For P&H Mining, the target level is $64,100,000. For Joy,
the target level is $56,600,000.  For HII, the target level is
$104,700,000.  These targets all apply for the fiscal year
beginning November 1, 1999.

The Debtors argue in their motion that these KERP amendments are
necessary to retain crucial employees and to maintain employees'
morale and confidence.

Judge Walsh finds the modification appropriate, provided that:

-- any change in the Stay/Emergence and Severance components of
the Employee Retention Program be subject to the Committee's
consent, and within the maximum amount of aggregate expenditures
approved under the Amended Order;

-- for an employee to receive compensation under the CEO
Discretionary Fund and/or the Employee Retention Program, the
employee must waive any claim for severance or COC payments
arising under a prepetition employment agreement or a COC
Agreement entered into with any Debtor. (Harnischfeger Bankruptcy
News Issue 21; Bankruptcy Creditors' Service Inc.)

HARNISCHFEGER: Taps The Blackstone Group
The Debtors ask the Court to authorize them to employ The
Blackstone Group L.P., as their Financial Advisors, nunc pro tunc
to November 15, 1999.

The Debtors believe Blackstone is well qualified and able to
provide HII with services necessary to maximize the value of the
estates in a cost-effective, efficient and timely manner.
Specifically, Blackstone will provide, subject to the Court's

  (1)  Assistance in the development and review of the Debtors'
business plans and related financial projections;

  (2)  Assistance in the development of financial data and
presentations to the Committee and Equity Committee and other
parties in interest;

  (3)  Evaluation of the Debtors' capital structure and debt

  (4)  Development of a financial foundation for a plan of
reorganization and analysis of plan of reorganization

  (5)  Valuation of the Debtors and their subsidiaries and of any
securities to be distributed as part of a plan of reorganization;

  (6)  Liaison with the Committee, the Equity Committee, and
other parties in interest and their respective professionals
regarding plan of reorganization issues and negotiations;

  (7)  Assistance in and advice to the Debtors concerning the
terms, conditions and impact of any proposed merger with the
Debtors, any acquisition by the Debtors, or any sale of the
Debtors or their divisions, subsidiaries or assets, except with
respect to any transaction involving Beloit Corporation and/or
its divisions, subsidiaries or assets;

  (8)  Assistance in securing senior exit financing for the
Debtors' domestic and foreign operations;

  (9)  Provision of expert testimony relating to the foregoing as
and when reasonably requested; and

  (10) Provision of other advisory services, as may be mutually
agreed, as to all financial matters concerning the Debtors'
obligations under the Bankruptcy Code relative to the execution
of the Debtors' chapter 11 cases.

The Debtors believe that the Services to be provided by
Blackstone, subject to the Court's approval, will not duplicate
the services that other financial advisors are already providing
to the Debtors in the chapter 11 case. In this regard, Blackstone
has agreed to make reasonable efforts to avoid such duplication.

The Debtors agree to pay Blackstone, subject final to Court

(1)  A Monthly Fee of $150,000;

(2)  A Reorganization Fee equal to 1.0% of the Reorganization
Value, less a 50% offset of the Monthly Fees, payable upon
consummation of the Debtors' plan of reorganization, but not
exceeding the amount of $5,000,000;

(3)  Reimbursement of all necessary and reasonable expenses.

(Harnischfeger Bankruptcy News Issue 21; Bankruptcy Creditors'
Service Inc.)

INCOMNET: Debtors Respond To Comments of US Trustee
In response to each of the objections of the US Trustee to the
Disclosure Statement of Incomnet, Inc. and its debtor affiliate,
the debtor has modified the Disclosure Statement to remedy some
of the US Trustee's objections.

The debtor supports its plan in the face of the US Trustee's
objections in the following instances:

The debtor states that Reorganized IC may prosecute any potential
preference actions involving transfers by IC's parent. Any
recoveries from these preference actions will inure to the
benefit of general unsecured creditors. Reorganized IC will serve
as disbursing agent with respect to the liquidation of IC's
parents' assets and the distribution of the proceeds to
creditors.  IC's employees are intimately familiar with IC's
parent's assets and liabilities and it is therefore appropriate
to designate reorganized IC as the representative of IC's
parent's estate for the purpose of prosecuting the IC's parent
preference actions.

The debtor also disagrees with the US Trustee's contention that
the debtors must take a position as to whether Ironwood is an
insider within the meaning of the Bankruptcy Code.  The debtor
also states that whether Ironwood is an insider may not ever
become relevant for plan confirmation purposes. The US Trustee
claims that there is no basis for Ironwood to "be deemed to
contribute assets of ICC's parent to ICC."  However, the debtor
states that a creditor is free to share its proceeds with third
parties.  According to the debtor, the trustee's claim to the
contrary confuses estate property and nonestate property.

The debtor also states that the plan provides that each holder of
a secured claim will be unimpaired and the US Trustee suggests
that the plan must separately classify each secured creditor
receiving this treatment.  The debtor believes that it would be a
waste of time and resources.

The US Trustee also suggests that the plan inappropriately
classifies all of Ironwoods' remaining secured and unsecured
claims against IC in a single class, Class 6.

KCS ENERGY: Reports Fourth Quarter and Full Year 1999 Results
KCS Energy, Inc. (NYSE: KCS) announced financial and operating
results for the fourth quarter and year ended December 31, 1999.  
Commenting on the Company's performance during the year, KCS
President and Chief Executive Officer James W. Christmas said,
"1999 was a turnaround year for KCS from an operational
standpoint.  We had solid drilling results, successfully
implemented our cost-reduction and property rationalization
programs and returned to profitability."

Net income for the year ended December 31, 1999 was $4.3 million,  
compared to a net loss of $296.5 million for the year ended
December 31, 1998.  

Excluding the effect of the 1998 non-cash asset writedowns, 1998
net loss was $8.1 million.  EBITDA for the year increased 14% to
$95.3 million, reflecting a 10% increase in average realized
natural gas and oil prices and lower operating and administrative
expenses, partially offset by $1.9 million of restructuring

In 54 separate transactions, the Company divested more than one-
third of its working interest wellbores, but less than 4% of its
reserves.  The Company also sold a group of overriding royalties
representing approximately 27% of its Volumetric Production
Payment (VPP) reserves.  In total, the Company sold reserves of
21.7 billion cubic feet equivalent (Bcfe) with net proceeds of
$27.7 million.  "These non-core property sales have enabled us to
reduce debt and sharpen our focus," Mr. Hahne said.

In 1999, KCS directed $60 million of available capital to its
three core business units -- the Mid-Continent, Onshore Gulf
Coast and Volumetric Production Payments.

Production in 1999 was lower than 1998 by 1.6 Bcfe, or 2.7%,
because of asset sales.

As previously announced, KCS is currently in default under its
bank credit facilities and its senior and senior subordinated
notes, and has been pursuing a financial restructuring
transaction which would significantly strengthen its balance
sheet.  On December 28, 1999, the Company announced that it had
reached an agreement on a proposed restructuring with holders of
more than two-thirds of the senior subordinated notes and holders
of a majority of the senior notes.  To effectuate this agreement,
the parties agreed that the Company would commence a case under
Chapter 11 of the Bankruptcy Code by January 18, 2000.  On
January 5, 2000, three holders of senior notes filed an
involuntary petition for relief against KCS Energy, Inc. (the
parent company only) under Chapter 11 of the Bankruptcy Code in
the U. S. Bankruptcy Court in Wilmington, Del.  On January
18, the Bankruptcy Court signed an order granting KCS relief
under Chapter 11 of the Bankruptcy Code.  Also on January 18,
2000, each of KCS Energy Inc.'s subsidiaries filed with the
Bankruptcy Court voluntary petitions under Chapter 11 of the
Bankruptcy Code.  On January 18, 2000, the Company also filed a
disclosure statement with the Court with respect to a proposed
plan of reorganization under Chapter 11 of the Bankruptcy Code.  
The disclosure statement and plan have been amended in subsequent
filings with the Court.  A hearing before the Court to consider
the adequacy of the disclosure statement is currently set for
April 11, 2000.  If the Court approves the disclosure statement
at the April 11 hearing, or shortly thereafter, the Company
intends to promptly begin soliciting votes to accept or reject
the plan of reorganization. However, there can be no assurance at
this time that the plan of reorganization proposed currently will
be confirmed by the Court.

KCS is an independent energy company engaged in the acquisition,
exploration and production of natural gas and crude oil with
operations in the Mid-Continent and Gulf Coast regions.  The
Company also purchases reserves (priority rights to future
delivery of oil and gas) through its Volumetric Production
Payment (VPP) program.  For more information on KCS Energy, Inc.,
please visit the Company's web site at

MARINER: Announces Executive Management Changes
Mariner Post Acute Network, Inc. today announced the appointments
of C. Christian Winkle to the position of chief executive officer
and Michael F. Gries chief restructuring officer, effective
immediately. Francis W. ("Butch") Cash will leave the Company
March 31, 2000.

"Over the past six months, Butch provided critical stability to
our Company during a difficult bankruptcy restructuring process
and we owe him a tremendous debt of gratitude for his efforts.
Today, our priorities focus on maximizing opportunities in our
core operations and continuing to provide high quality patient
care," said Gene E. Burleson, chairman of the board of directors
of Mariner. "This succession represents an affirmation of our
high regard for Chris Winkle's operating skills and validation of
the procedures Chris put in place when he joined the Company in
January 1999. Also, the addition of Mike Gries solidifies our
management team. As a founding member of Conway, Del Genio, Gries
& Company, Mike was a leader of our restructuring team and brings
continuity to our efforts."

Before joining Mariner in January, 1999, Winkle, 37, served in
several senior management positions at Integrated Health
Services. During his tenure, his responsibilities included the
management of more than 400 post-acute facilities. Gries served
as outside financial advisor to Mariner as a founding member of
Conway, Del Genio, Gries & Company, LLC.

Mariner Post-Acute Network, Inc, headquartered in Atlanta,
Georgia, operates more than 400 skilled nursing, sub-acute and
assisted living facilities with approximately 50,000 beds.
American Pharmaceutical Services, the Company's institutional
pharmacy group, operates approximately 40 institutional
pharmacies, serving more than 2,000 facilities, comprising
approximately 125,000 beds. In addition, the Company's Specialty
Hospital group operates 13 Long-Term Acute Care hospitals in key

MEDPARTNERS: Seeks To Extend Time To Assume/Reject Leases
MedPartners Provider Network, Inc., debtor, seeks an order
extending for ninety days, through and including June 6, 2000,
the time within which the debtor must assume or reject any and
all unexpired leases of non-residential real property wherein the
debtor is the lessee including the ground leases at 5000 and 5001
Airport Plaza Drive, Long Beach, California, leased from Long
Beach Airport Business Park.

Pending court approval of the divestiture of the properties and
completion of the debtor's review/assessment of the value of any
other leases, and in order to ensure the preservation of
potentially valuable assets and the ability to reject major
liabilities, the debtor seeks the extension.

MICHAEL PETROLEUM: Order Authorizes Use of Cash Collateral
A hearing on the second motion of debtors for order authorizing
further use of cash collateral and granting adequate protection
will be held before the Honorable Wesley W. Steen, US Courthouse,
515 Rust Street, Houston, Texas on April 3, 2000.

MITSUI MINING & SMELTING CO.: Speeds Up Debt Reduction
Mitsui Mining & Smelting Co. (5706) expects to show group
interest-bearing liabilities of about 235 billion yen as of
March 31, a decline of 56 billion yen from a year ago.

This means the nonferrous metal company will have
accomplished the debt reduction goal put forth in its
current business plan one year earlier than proposed. It
hopes to slash debt by another 10 billion yen next fiscal

The faster reduction is attributed to a rise in free cash
flow stemming from the concentration of its resources in
the profitable area of electronics materials in earlier
years. The company expects to generate free cash flow of 16
billion yen this fiscal year, and these funds are used to
repay debt. A gain of some 11 billion yen from the sale of
fixed assets will also be used to repay loans.

Thanks to its rising share price, the company's convertible
bonds have also undergone a wave of conversions, and the
combined outstanding balance of bonds issued up to last
fiscal year should decline by about 15.3 billion yen.
(Nikkei  22-March-2000)

MTS INC: Moody's Lowers Ratings
Moody's Investors Service lowered the debt ratings of MTS, Inc.
("Tower"), the wholly owned operating subsidiary of TOWER
RECORDS, INC., and of its Japanese subsidiary Tower Records K.K.
This concludes the review for possible downgrade started in July,
1999. The following ratings were affected by this action:

For MTS, Inc. -

Senior implied rating lowered to B2 from Ba3;

$125 million senior secured credit facility due 2001 to B2 from

Senior unsecured issuer rating to B3 from B1;

$110 million senior subordinated notes to Caa1 from B2.

For Tower Records K.K. -

Yen 19,414 million guaranteed revolving credit facility due 2001
to B2 from Ba2.

The rating outlook on all debt is stable.

The downgrades reflect a continuing weak sales trend in Tower's
key U.S. and European markets despite industry-wide growth in
sales of entertainment products, indicating deteriorating market
share;a high level of fixed costs; delays in implementing systems
and operational changes discussed in mid-1999; competition from
on-line and traditional retailers; and the expectation that gross
margins could remain depressed due to a shift toward lower-margin
product mix and selling channels. The ratings continue to reflect
Tower's high lease-adjusted leverage and high levels of fixed
costs; and potential volatility in margins and top line sales due
to competitive factors and availability of new entertainment

The ratings also consider the benefit of Tower's typical high-
cost, high-traffic locations around the world, which create
strong name recognition in urban markets; expectations that
interest coverage will remain adequate for the near term; the
company's continuing importance to vendors in the U.S. and Japan;
and the potential for new sales from the introduction of a
limited selection of electronic products into the stores.

The ratings outlook is stable. Future ratings actions will depend
on Tower's ability to stabilize its market position or gain
operating efficiencies which would improve profitability and cash

The downgrade of the bank facilities recognizes a decline in
asset coverage levels as average usage has climbed, as well as
the Tower's general deterioration in credit quality. The bank
facilities are secured by receivables and inventory, and as such
are structurally senior to other obligations. There is no direct
borrowing base controlling borrowings. There is an asset coverage
covenant requiring a minimum level of asset coverage to
borrowings, but Moody's believes this provides only moderate
protection to lenders. The banks also benefit from a pledge of
65% of the stock of MTS' foreign subsidiaries. All of the rated
debt is guaranteed by Tower's U.S. operating subsidiaries, and
the TRKK facility is guaranteed by MTS. The non-U.S. operations,
which generate about two-thirds of the company's revenues, do not
guarantee the notes.

For the near term, Tower has substantial liquidity remaining
under bank facilities which total $275 million. The bank lines
expire in 2001, however. Based on recent financial performance,
Moody's believes the company could come close to the 1.25 times
limit of the fixed charge covenant, which could result in a
renegotiation of the credit facilities.

Tower has failed to achieve expected operating improvements, and
has underperformed its peers in terms of same store sales growth
during a time of moderate growth in its combined product
segments. Moody's believes that entertainment megastores, which
sell a relatively high proportion of catalog product to new
releases, are more vulnerable to Internet-based competition than
mall stores. Gross margin continued its downward trend during the
first 6 months of fiscal 2000 (ending July 2000). Moody's expects
this trend to continue due to a lower-margin product mix in the
Far East, lower vendor discounts in the U.S. due to lower
purchasing volumes, and the growth of lower-margin Internet
sales. As a result, Tower is not receiving sufficient benefit
from sales growth to cover its high fixed costs and e-commerce
development expenses. In addition, the company has delayed
previously discussed changes in its buying and distribution model
which could enhance productivity.

Moody's expects gross EBITDA margin (before of foreign currency
translation adjustments) for the near future to be at or below
last year's levels despite an increase in revenues. Moody's
expects EBITDAR to fixed costs will hover at about 1.25 times,
and anticipates a potential increase in borrowings to finance
capital expenditures, development of Tower's Internet presence,
and working capital investments. Investment needs could be
reduced if the company decides to withdraw from less productive

About two-thirds of Tower's business comes from their overseas
operations. Moody's believes that foreign exchange risk is
relatively well hedged as a result of the yen-denominated bank
line and local sourcing of inventory.

MTS, Inc., headquartered in West Sacramento, California, is the
primary operating subsidiary of TOWER RECORDS, INC. The company
operates about 180 entertainment megastores in the U.S. and
around the globe. Revenues were $1,026 million in the fiscal year
ended July 1999.

OCELOT ENERGY: Changes Name and Moves to Jersey
Ocelot International Ltd. announces that it plans to change its
name to PanAfrican Energy Corporation Ltd. with a change
to its jurisdiction of incorporation to Jersey in the Channel
Islands. The name change reflects the company's primary focus on
long life, high margin energy development projects in Sub-Saharan
Africa.  The change in jurisdiction will simplify the company's
administrative structure.  The transaction will involve an
exchange of the issued share capital for identical shares of the
Jersey company and will be effected by a Court approved plan of
arrangement and presented to shareholders at a special
shareholders meeting to be scheduled in approximately 60 days.  
The plan of arrangement is also subject to regulatory
approval.  The company also intends to add a Luxembourg Stock
Exchange listing in the near future.

Ocelot International Ltd. is an international energy company
engaged in the exploration production and marketing of oil, gas
and electricity. Ocelot's asset portfolio includes oil production
in Gabon and the Democratic Republic of Congo, natural gas
development and co-generation projects in Tanzania and Cameroon,
together with an oil and natural gas development in Kazakhstan.

Ocelot International's Class B subordinate voting shares in Class
A common shares are listed for trading in the Toronto Stock
Exchange under the symbols OCE.B and OCE.A respectively.

PACIFIC INTERNATIONAL: Zaremba Group Agreement Approved By Court
Zaremba Group, LLC's Agreement with Pacific International
Enterprises was approved by the Los Angeles Bankruptcy Court on
March 22, 2000. This Agreement is for a term of three years and
is automatically renewable for successive three year terms.

Zaremba will market and resell PIE products; snowboards,
wakeboards,skateboards, skiboards, snow and water skis and other
sports products.

Zaremba will acquire clear title to all existing PIE assets and
will lease these assets to PIE at a base rent of $1 per annum.

Zaremba has obtained funding in the amount of $7 million that is
designated to support PIE's successful emergence from Chapter
11.$450,000 has been earmarked for moving PIE, Inc. to new
manufacturing facilities in Southern California, restarting its
business operations and funding its administrative expenses that
will need to be paid on plan confirmation.

Zaremba shall provide interest-free purchase order production
financing to PIE during the term of this Agreement.

The parties shall use their best efforts to be ready for
commencement of operations no later than May 5, 2000.

PACIFIC NEVADA: Case Summary and Largest Unsecured Creditors
Debtor: Pacific Nevada Investment Corp.
        1101 Las Vegas Blvd
        Las Vegas, NV 89101

Type of Business: Real Estate Investment

Petition Date: March 7, 2000   Chapter 11

Court: District of Nevada

Bankruptcy Case No.: 00-11604

Judge: Linda B. Riegle

Debtor's Counsel: PRO SE

Total Assets: $ 1,350,000
Total Debts:  $ 1,040,425

Largest Unsecured Creditors

County of Clark               $ 12,000
City of Las Vegas              $ 8,000
Nevada Power Company           $ 2,000
Maintenance Warehouse          $ 1,000
Silver State Disposal            $ 750
Southwest Gas                    $ 500
Las Vegas Valley Water            $ 50

PHYSICIAN COMPUTER: Seeks Approval of Settlement Agreements
The debtors, Physician Computer Network, Inc. and its debtor
affiliates seek court approval of the Settlement Agreements with
Oracle and GECC, which globally resolve the substantial disputes
among the parties.

The Oracle settlement provides that PCN will pay and Oracle will
accept the amount of $60,922 or less than half of the disputed
invoices, which amount will be due on or before May 26, 2000.  In
addition, the program licenses that were the subject of the
invoices will be terminated.

The GECC Settlement provides for allowance of a Class 4 claim
under the plan in favor of GECC in the amount of $95,000.  The
proposed allowance represents a more than 60% reduction of GECC's
filed claim amount.

PRIMARY HEALTH SYSTEMS: Hospital Ordered Reopened
A Cleveland hospital stopped admitting patients as a jointly
owned suburban hospital was ordered reopened by a bankruptcy
court judge.

The one-week reprieve for Mt. Sinai Medical Center-East in
suburban Richmond Heights was ordered by U.S. Bankruptcy Court
Judge Mary Walrath in Wilmington, Del., where the parent Primary
Health Systems Inc. of Wayne, Pa., is trying to reorganize its

Judge Walrath said closing the hospital could hurt chances to
find another buyer. University Hospitals Health System of
Cleveland has offered $10 million for Mt. Sinai-East and St.
Michael Hospital in Cleveland.

James Ricciardi, an attorney for PHS, told the judge that Mt.
Sinai-East barely had enough cash to make its payroll and
couldn't guarantee the safety of patients because so many
employees have already left.

Ricciardi said the order keeping Mt. Sinai-East open could kill a
$62.7 million deal with the Cleveland Clinic. Under the terms of
the deal, which the court must review, the Clinic agreed to buy
the two hospitals only if they are closed.

Walrath was expected to hear a motion today for an order
directing the reopening of St. Michael, which stopped admitting
patients on Wednesday and ordered its emergency room closed by

PHS announced two weeks ago that it would close St. Michael by
the end of the month and sell it to the Cleveland Clinic

Under pressure from the city, PHS later agreed to convert part of
St. Michael into a nursing home and to open a medical clinic at
the location.

The City Council and community leaders have been trying to find
an alternative to closing St. Michael, which serves the city's
Slavic Village neighborhood alongside Interstate 77, and Mt.

PHS, trying to resolve its financial problems in bankruptcy
court, said the plans for St. Michael reflected its attempt to
balance financial problems and the community's medical needs.

SHOE CORP: Seeks To Extend Time to Assume/Reject Leases
Shoe Corporation of America, Inc. seeks an order further
extending for an additional 60 days, up to and including June 8,
2000, the time within which the debtors must assume or reject
their unexpired leases of nonresidential real property.

There is one unexpired lease to which the debtor is a party, and
it is an integral part of the remainder of the liquidation being
conducted by the debtors.  An ultimate decision with regard to
the lease has not yet been made and the debtors need to complete
the liquidation process and to assess the value or potential
marketability of the unexpired lease and make determinations with
respect to whether the unexpired leases should be assumed and
assigned, or ultimately rejected.  The debtors believe this
process can be accomplished in the next 60 days.

STAR NEWCO: Seeks Authority For Second Employee Severance Program
The debtor, Star Newco, Inc. seeks an order authorizing and
approving the second employee severance program.

A hearing on the motion will be held before the Honorable Mary F.
Walrath on April 4, 2000 at 10:30 AM.

In connection with its core business, the debtor believes that it
is crucial to provide Mitch Hall, the most important employee in
its sales force with incentives to ensure that he remains with
the debtor during the period following the Asset Sales.  The
debtor seeks approval of a one time $20,000 payment and continued
medical benefits for six months.


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