TCR_Public/000524.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, May 24, 2000, Vol. 4, No. 102


ACME METALS: Seeks To Extend Exclusive Periods
ATLANTIC GULF: Announces First Quarter Results
BIRMINGHAM STEEL: Completes New Financing Agreements
BMJ MEDICAL: Third Motion To Extend DIP Financing
BOO.COM: Lots of Sizzle; No Steak

BOSTON CHICKEN: Motion To Assume & Assign and Reject Leases
CAMBIOR INC: Closing of the Zinc Asset Sale
CONNECTIVITY TECHNOLOGIES: Loss in Revenues and Income
CONTOUR ENERGY: Revenues Up; Net Loss Improves
CRAFTSHOP.COM: Case Summary and 20 Largest Unsecured Creditors

DIMAC HOLDINGS: Seeks Extension To Assume/Reject Leases
EAGLE FOOD CENTERS: Lower Revenues, Higher Net Loss
EMPLOYEE SOLUTIONS: Financial Situation Scaring Customers
EQUALNET COMMUNICATIONS: Revenues Increase; Losses Unchanged
GILEXO LLC: Involuntary Case Summary and 3 Largest Creditors

HARNISCHFEGER: Motion To Sell Shares of Beloit Poland, SA
HEDSTROM HOLDINGS: Committee Taps Whitman Breed
HVIDE MARINE: Alleged Improper Payments
INDIANHEAD MOUNTAIN:  Files for Chapter 11
INTEGRATED PACKAGING: Reports First Quarter 2000 Results

IOWA SELECT: Moody's Downgrades Ratings
IRIDIUM: Motorola Takes $ 1.2 Billion Write-Off
JITNEY JUNGLE: Closes Two Stores
KEY PLASTICS: Response to Motion For Additional Committee
KOREAN AIR: Posts Loss, as Fuel Costs Soar

MARINER: First Motion For Extension of Exclusivity
MARKETING SPECIALISTS: Moody's Lowers Sr Subordinated Notes
MOSSIMO: Big Board to Suspend Mossimo
PHC INC: Reports Net Loss for the Quarter
PRINCETON HOSPITAL: Lakeside Alternatives Acquires Company

SC NEW HAVEN: Order Confirms Joint Plan of Liquidation
SERVICE MERCHANDISE: Renders Monthly Operating Report
SOUTHERN MINERAL: Order Approves Disclosure Statement
STONE & WEBSTER: Stock Trades on OTC Board and NGB 'Pink Sheets'
SUN HEALTHCARE: Seeks To Spend $3.7MM For New Network Equipment

THIS END UP: Not All Customer Orders Will be Filled
US LEATHER: Seeks to Liquidate Milwaukee Properties
VENCOR: Court Approves Fifth Amendment To DIP Facility


ACME METALS: Seeks To Extend Exclusive Periods
The debtors, ACME Metals, Incorporated et al. seek a court order
extending for approximately one month the exclusive periods
within which the debtors may file a plan of reorganization and
solicit acceptances thereto, to and including June 30, 2000 and
August 31, 2000, respectively.  

The debtors believe that this brief extension of exclusivity is
necessary to resolve outstanding issues relating to exit
financing and to clarify the situation regarding a possible
third-party transaction.  The debtors believe events likely to
unfold during the requested extension will provide information
crucial to finalizing a reorganization plan.

The debtors negotiated a proposed exit financing facility with
Citicorp USA contingent upon approval of Citicorp's application
for a partial guarantee by the federal government under the
Emergency Steel Loan Act.  Citicorp has submitted an application
for a guarantee of the proposed exit financing, but, to date,
neither Citicorp nor any other applicant has received a response.  
The debtors hope that a decision by the Emergency Steel Guarantee
Loan Board will be acted upon by June 30, 2000.

ATLANTIC GULF: Announces First Quarter Results
Atlantic Gulf Communities Corporation (OTC Bulletin Board: AGLF)
reported results for the third quarter ending March 31, 2000.

Atlantic Gulf Communities, which is now beginning the final phase
of a restructuring program, reported a third quarter net loss of
$4.7 million or $.38 per share on revenues of $13.0 million. The
results a reserve of $1.1 million related to an investment in a
joint venture. In the first quarter 1999, the company reported a
net loss of $9.4 million or $0.77 per share.

Richard Ackerman, Atlantic Gulf Communities Corporation, CEO,
said, "We have nearly completed two out of three restructuring
phases -- reducing inventory and disposing of lower margin
inventory. Our focus in phase III is to build on the company's
remaining properties, WestBay and Chenoa, to restore

Atlantic Gulf Communities is a residential real estate developer.
Its current holdings include WestBay, a 696-unit community near
Naples, Florida, and Chenoa, a 577-unit community near Glenwood
Springs, Colorado.

BIRMINGHAM STEEL: Completes New Financing Agreements
Birmingham Steel Corporation (NYSE:BIR) announced it has
completed definitive documentation for new financing agreements
which provide additional operating flexibility, relief from
previous financial covenants and$25 million in new borrowing

John D. Correnti, Chairman and Chief Executive Officer of
Birmingham Steel, commented, "We are pleased to report the
conclusion of a new financing accord with our lenders. In
addition to providing more operating flexibility, the new
agreements effectively double the Company's previous liquidity
level. Together with other fundamental improvements that have
recently occurred in our operations, the new agreements signal
the end of the cash crunch that has hampered the Company for the
past nine months."

Correnti noted the new agreements did not change the interest
rates on the Company's existing debt, and no cash fees were
incurred in connection with the new agreement. As compensation
for the new agreements, lenders received warrants for 3 million
shares of the Company's common stock, exercisable over a ten-year
period at a price of $3 per share.

BMJ MEDICAL: Third Motion To Extend DIP Financing
The debtors, BMJ Medical Management, Inc., et al., request that
the court enter an order further extending the post-petition
debtor in possession financing under which the debtors currently
operate their business and manage their properties.  A hearing on
the motion will be held on June 7, 2000 at 2:00 PM.  The
objection deadline is May 31, 2000 at 4:00 PM.

The debtors seek to further extend the DIP Financing on the same
terms and conditions as set forth in the Second Amended Post-
Petition Credit Agreement as further amendd by a waiver and third
amendment to Credit and Guarantee Agreement.  

The debtors seek an extension of the DIP Financing to September
15, 2000 in order to allow the debtors sufficient time to
complete the process of evaluating their options with respect to
their remaining Medical Groups, complete negotiations with such
medical groups, file an amended plan reflecting agreement with
all their creditor constituencies, and ultimately confirm such
amended plan.  Until such time as a plan is consummated, however,
the debtors must continue to manage their properties in order to
maximize their going-concern value.

Today there are five remaining affiliated Medical Groups.
BMJ provides ongoing management services to all five of them. The
debtors other than BMJ have no active business operations. BMJ's
operations are concentrated in the South Florida marketplace. A
Joint Plan of Reorganization was filed in August, 1999.  The
debtors need to complete the analysis of what course of action to
take with respect to the remaining Medical Groups.  

BOO.COM: Lots of Sizzle; No Steak
In an article in The Wall Street Journal on May 23, 2000, Sarah
Ellison reported that in light of the decision to liquidate the
company, there was more wrong with than just its ads.'s founders, Ernst Malmsten and former model Kasja
Leander, set up a Web site in March 1999, two months before the
site was slated to go live for electronic commerce. They booked
media space for a formal launch last May and announced a two-
year, $65 million advertising budget after hiring London ad
agency BMP DDB. The agency created a campaign showing geeky kids
playing sports in cool clothes that would be available from

But the May launch didn't materialize, and the company reworked
the campaign with BMP DDB. Unfortunately, technical and
logistical difficulties prevented the site from launching until
November -- four months after beginning its ad campaign.

The company's shareholders included French entrepreneur
Bernard Arnault and Italy's Benetton family.

According to some, advertised early before seeing what
offers interested its customers. built up big
expectations and then seriously underperformed.

The company reported spent about $25 million -- much of it
still owed to the agencies that created and executed the ads.
The company also began by offering designer clothing at retail
prices, and then tried to change to bargain prices.  The
company's liquidation is now proving that with no clear
direction, and no customer base, even the best advertising
campaign may prove pointless.

BOSTON CHICKEN: Motion To Assume & Assign and Reject Leases
The Debtors tell the Court that they have assumed 92
nonresidential real property leases and there are 507 Remaining

Pursuant to the Asset Purchase Agreement between the Debtors and
GRO, the Debtors seek Court authorization to:

(i)   assign the Assumed Leases to GRO;

(ii)  assume and assign to GRO the Remaining Leases less leases
that the Debtors intend to reject, which the Debtors will refer
to as the GRO Leases;

(iii) reject leases and to notify landlords concerned accordingly
on the date of confirmation of the Plan.

The Debtors ask the Court to also authorize mutual release of
claims between the Debtors and the landlords and between
landlords and third parties pertaining to the assumption and
assignment of the leases.

The Debtors remind the Court that pursuant to the Asset Purchase
Agreement, the fixtures and equipment in the stores with respect
to the Assumed Leases and the GRO Leases will be sold to GRO.

With respect to the Rejected Leases, the Debtors plan to vacate
the premises during June, 2000, and to notify the respective
landlords of the dates in accordance with the Fifth Order for
extension of time to assume or reject unexpired leases on non-
residential real property.

As the lease provisions related to Store Location #1411 in New
Jersey restricts the use of the location to only a Boston Market
restaurant, the Debtors ask the Court to authorize that such
provision be stricken as unenforceable, pursuant to Section 365
of the Bankruptcy Code which permits the assignment of assumed
unexpired leases of a debtor despite such a provision, and in
line with Congressional policy which favors assumption and
assignment, as evidenced in Re Howe, 78 B.R. 226, 230 (Bkrtcy,
D.S.D. 1987), in which "The Bankruptyc Court will render
unenforceable any provision whose sole effect is to restrict

The Debtors believe that the financial strength of GRO provides
sufficient assurance that the landlords will be paid and that no
future defaults under the terms of the original leases will
occur. (Boston Chicken Bankruptcy News Issue 23; Bankruptcy
Creditors' Services Inc.)

CAMBIOR INC: Closing of the Zinc Asset Sale
All amounts are expressed in US dollars

Cambior Inc. announces the closing of the sale of the Bouchard-
Hebert and Langlois zinc mines, located in northwestern Quebec,
to Breakwater Resources Ltd. with an effective date of May 1st,

An amount of $45 million will be allocated to the partial
repayment of the credit facility.  Consequently, Cambior's total
debt due to its creditors will be reduced from $225 million to
$167 million, including the $13 million payment made after the
closing of the Glamis Gold and Jipangu transactions.  In
addition, the obligation to pay $75 million before June 30, 2000
will be partially met with these payments to creditors totaling
$58 million, leaving a balance of $17 million to be paid before
June 30, 2000.  Cambior's cash position, after giving effect to
the above debt repayment, will be approximately $10 million.

The evaluation process and preparation of offers by third parties
for each of Cambior's other non-gold assets are well underway.
Certain transactions are at an advanced stage of negotiation and
should be announced at the beginning of June 2000.  While there
can be no assurance to that effect, Cambior is confident to meet
its financial obligations.

Assuming the success of this strategy, Cambior will focus on gold
mining in the future, having retained all of its core gold
assets, and will be better able to develop its gold properties
and participate in the consolidation process expected in the gold
sector, to the greater benefit of its shareholders.

Cambior Inc. is a diversified international gold producer with
operations, development projects and exploration activities
throughout the Americas. Cambior's shares trade on the Toronto
and American (AMEX) stock exchanges under the symbol "CBJ".

CONNECTIVITY TECHNOLOGIES: Loss in Revenues and Income
Connectivity Technologies Inc. is principally engaged in the
manufacture and assembly of wire and cable through its
subsidiary, Connectivity Products Incorporated.  The major
markets served by the company are commercial and residential
security, factory automation, traffic and transit signal control
and audio systems. The company has no operations other than those
carried out by Connectivity Products Inc.

On November 15, 1999, the company executed a non-binding Letter
of Intent with Rome Group Inc.  The Letter of Intent provides for
the merger of CPI into a wholly-owned subsidiary of Rome.  If the
merger is consummated, the outstanding debt obligation of CPI is
expected to be satisfied and the company is expected to record a
loss on disposal in the range of $15-19 million,  But if the
merger does not take place, CPI would lack sufficient funds to
continue its operations and the company would lose its entire
investment in CPI, its only substantial asset, unless the company
were successful in promptly implementing interim measures such as
selling its subsidiary or a part thereof to another buyer,
concluding another interim arrangement with its lenders or
locating another source of financing. Although other potential
buyers have expressed an interest in acquiring CPI, the company
says it sees no immediate prospect of promptly implementing any
such interim measures.

As of May 1, 2000, the company had 182 full time employees.  Its
year-end, December 31, 1999 revenues were $42,308 with a net loss
of $2,022.  For the same period, the year ended December 31,
1998, the company's revenues were $45,167 and a net gain of
$3,714 was realized.

CONTOUR ENERGY: Revenues Up; Net Loss Improves
Contour Energy Co. (formerly Kelley Oil & Gas Corporation),
incorporated in Delaware in 1994, with its subsidiaries and
subsidiary partnerships, is engaged in the acquisition,
exploration, development and production of oil and natural gas.
The company indicates its strategy is to increase reserves,
production and cash flows in a cost-efficient manner through
strategic domestic acquisitions and a program of balanced
development and exploration activities.

In the year ended December 31, 1999, the company experienced a
net loss of $13,940 on revenues of $81,944. In the prior year,
ended December 31, 1998 the company's net loss was $61,557 on
revenues of $79,655

CRAFTSHOP.COM: Case Summary and 20 Largest Unsecured Creditors
Debtor: Craftshop.Com, Inc.
        25 Van Zan Street, Suite 19C
        East Norwalk, CT 06855

Type of Business: An e-commerce retailer with a web-site, which
provides craft related products, resources and finished items.

Petition Date: May 22, 2000    Chapter 11

Court: District of Delaware

Bankruptcy Case No.: 00-02062

Debtor's Counsel: Charlene D. Davis
                  The Bayard Firm
                  222 Delaware Avenue, Suite 900
                  PO Box 25130
                  Wilmington, DE 19899
                  (302) 655-5000

                  Jillian K. Aylward
                  Curran, Coffey & Moran, LLP
                  One Washington Mall
                  Boston, MA 02018
                  (617) 720-3626

Total Assets: $ 100 to 500,000
Total Debts:  $ 1,855,577

20 Largest Unsecured Creditors

DoubleClick                   $ 170,520
America Online, Inc.          $ 159,281
Ask Jeeves, Inc.              $ 146,333
CKS/USWebb Corp.              $ 106,977
Lycos Inc.                     $ 68,026
NBCI                           $ 51,201
Excite@Home, Inc.              $ 41,414
GO 2NET INC                    $ 35,143
Looksmart, Ltd.                $ 34,740
Infoseek Corp.                 $ 21,433
Primedia-1                     $ 20,760
Meredith Corporation           $ 17,117
County Sampler                 $ 16,830
Mary Engelbreit's Home
Companion                      $ 15,249
Cort Furniture Rental Corp.    $ 14,599
Pandesic File 733-57           $ 12,696
Primedia-Sew News              $ 12,500
AT&T                           $ 12,414
MCI Worldcom                   $ 10,875
Crafts 'n' Things              $ 10,710

DIMAC HOLDINGS: Seeks Extension To Assume/Reject Leases
The debtors, DIMAC Holdings, Inc., et al., seek an extension of
time within which they may assume or reject unexpired leases of
nonresidential real property.

A hearing on the motion will be convened at the Bankruptcy Court
for the District of Delaware before the Honorable Mary F. Walrath
on June 5, 2000 at 3:30 PM.

As of the Commencement Date, the debtors were lessees under 44
unexpired leases of nonresidential real property.  

The debtors expect that due to the size of their cases, they will
not have an adequate opportunity to review and analyze each of
the unexpired leases to determine the benefits or burdens of each
lease to the debtors' estates within sixty days.  The debtors
request that they be granted an extension to the Confirmation

EAGLE FOOD CENTERS: Lower Revenues, Higher Net Loss
Eagle Food Centers, Inc., a Delaware corporation,. is a regional
supermarket chain operating 84 supermarkets as of the 1999 fiscal
year end in the Quad Cities area of Illinois and Iowa, northern,
central and eastern Illinois, eastern Iowa, and the Chicago/Fox
River Valley and northwestern Indiana area under the trade names
"Eagle Country Market(R)" and "BOGO's." Most Eagle supermarkets
offer a full line of groceries, meats, fresh produce, dairy
products, delicatessen and bakery products, health and beauty
aids and other general merchandise, and in certain stores,
prescription medicine, video rental, floral service, in-store
banks, dry cleaners and coffee shops.

On February 29, 2000, the company filed a voluntary petition
under Chapter 11 of Title 11 of the United States Code. The
petition was filed in the United States Bankruptcy Court for the
District of Delaware. Eagle continues to manage its affairs and
operate its business as a debtor-in-possession while the
Bankruptcy Case is pending. According to the company, the
bankruptcy case, which is proceeding before the United States
District Court for the District of Delaware, was commenced in
order to implement a financial restructuring of the company that
had been negotiated with holders of approximately 29% of the
principal amount of the company's Senior Notes due April 15,

On March 10, 2000, the company filed a plan of reorganization to
implement the financial restructuring, which plan was
subsequently amended on April 17, 2000.  The Plan contemplates
the closing or sale of 20 underrperforming locations, which will
reduce the number of operating stores from 84 for the fiscal year
ended January 29, 2000 to 64. The company estimates that total
sales will decrease to approximately $800 million in fiscal 2000
as a result of the decrease in stores. During fiscal 1999, the 20
underperforming stores had sales of approximately $140 million
and operating losses of approximately $3 million, excluding
corporate allocations of overhead. As such, the company
anticipates that the closing of the stores will have a favorable
impact on operating income, excluding the expenses related to the
debt restructuring and the bankruptcy case.

In reporting on its latest fiscal year ended January 29, 2000,
Eagle shows revenues of $932,789 as compared to $943,805 for the
fiscal year ended Janaury 30, 1999.  Net losses for the fiscal
years 1999 and 1998 (ended 12/29/00 and 12/30/99) were $6,541 and
$3,925, respectively.

EMPLOYEE SOLUTIONS: Financial Situation Scaring Customers
The Arizona Republic reports on May 17, 2000 that Employee
Solutions, Inc. announced that its net losses broadened to $5.6
million, or 14 cents a share for the first quarter compared to a
net loss of $ 3.5 million, or 11 cents a share, in the same
period a year ago. Revenues for the quarter that ended March 31
fell 4 percent, to $ 190.5 million, from $ 198.9 million a year

EQUALNET COMMUNICATIONS: Revenues Increase; Losses Unchanged
Equalnet Communications Corp., incorporated in the state of Texas
on January 20, 1995 (previously known as EqualNet Holding Corp.),
is a holding company currently comprising three wholly-owned
operating subsidiaries, EqualNet Corporation, a long-distance
telephone company providing services to generally smaller
commercial and residential accounts nationwide, Netco Acquisition
Corp., the owner of nine telecommunications switches located in
major U.S. cities, and USC Telecom, Inc. formed in the
first quarter of fiscal 1999 to acquire the assets purchased from
SA Telecommunications, Inc.

As of June 30, 1999, EqualNet Communications employed
approximately 100 persons.  Various members of management left
the company during fiscal 1999. Robert H. Turner was removed by
the Board of Directors as Chief Executive Officer of the company
in July 1998. Bob Henson resigned as Chief Operating Officer in
July 1998. Maurie Daignean, who was appointed as the company's
Chief Operating Officer in July 1998 resigned in August 1998 to
pursue other opportunities.  David Kerr resigned as Interim Chief
Financial Officer in February 1999.

The company's revenues increased to $32.4 million in fiscal year
ended June 30, 1999, as compared to $24.9 million for the fiscal
year ended June 30, 1998.  Revenues for the fiscal year ended
June 30, 1997 were $46.6 million.  Losses in those fiscal years
were $18.0 million in each of 1999 and 1998, and $15.0 million in

GILEXO LLC: Involuntary Case Summary and 3 Largest Creditors
Alleged Debtor: Gilexo, L.L.C.
                A California Limited Liability Company
                420 Cesar E. Chavez Blvd
                Calexico, CA 92231

Involuntary Petition Date: May 18, 2000

Bankruptcy Case No.: 00-05111       Chapter 11

Court: S. District of California    Judge: John J. Hargrove

Petitioner's Counsel: F. Shaun Burns
                      185 West F Street, Suite 700
                      San Diego, CA 92101
                      (619) 338-9400


Allen Earley
420 Cesar E. Chavez       Breach of
Calexico, CA 92231        Contracts         $ 450,000

3 Largest Unsecured Creditors

Costello Sewing           Supplies            $ 9,732
Dara Thread               Supplies            $ 3,472
Hutchison Bloodgood                           $ 1,075

HARNISCHFEGER: Motion To Sell Shares of Beloit Poland, SA
The financial situation at Beloit Poland, S.A., the Debtors tell
Judge Walsh, is precarious.  Beloit Poland must be sold or it
will have to be liquidated through Polish insolvency proceedings.  
In the event of a liquidation, the Debtors would receive little,
if anything, on account of Intercompany Receivables and a
liquidator would press to collect on Beloit Poland's Intercompany

The Debtors turned to Michael Fox International to seek out
prospective purchasers for the Debtors' equity interest in Beloit
Poland.  MFI's international search produced one offer from one
buyer.  By this Motion, the Debtors ask the Court to approve the
sale of its shares in Beloit Poland to that Buyer.  

Inwestycja 2000 Prezedsiebiorstwo Produkcyjino-Handlowo-Uslugowe
Sp. z.o.o. and Mr. Aaron Braaten offer to acquire the Debtors'
shares in Beloit Poland in exchange for (i) a $50,001 cash
payment, (ii) the waiver of $22,998,654.45 in Intercompany
Receivables owed to Beloit Poland, (iii)assignment of a $189,737
Intercompany Receivable owed to Beloit Poland to Beloit
Corporation, and (iv) the Debtors' payment of $1.4 million owed
on a $3.4 million revolving facility under which Beloit Poland
borrows from Raiffaissen Centrobank S.A., Warsaw.  

Mark E. Readinger, Senior Vice President and President of Beloit
Corporation, tells Judge Walsh that the sale agreement with
Inwestycja and Mr. Braaten is the product of good faith, arm's-
length negotiation.  He is convinced that this is the best deal
available to the Debtors.  Mr. Readinger discloses that Mr.
Braaten serves as Vice President for the Beloit Europe, Paper
Group division.
                 *   *   *

Omega Papier Wernshausen GmbH cries that Beloit's motion for the
sale of shares of Beloit Poland S.A., does not attend to the
impact the sale will have on Beloit Poland, its creditors and its
obligations. Rather, under the terms of Beloit's proposed sale,
as Omega points out, the purchasers are not entitled to use
certain Harnischfeger technology. Given this, Beloit Poland may
not be able to complete the contract with Omega for the
construction of a paper manufacturing machine for Omega. In the
event this happens, the sale will increase Beloit USA's and
Harnischfeger's administrative claim liability claims under
certain post-petition guaranties. Omega Papier therefore argues
that the proposed sale is not in the best interests of the
Debtors' estates and should not be approved.

Omega Papier relates to the Court the series of events that lead
to the situation and Omega's conclusion:

In 1998-99, Omega solicited bids for the construction of a paper
manufacturing  machine at its Facility for a paper manufacturing
plant in Wernshausen, Germany. Specifically, Omega solicited bids
for a  "turn key" operation by which a single contractor was to
be responsible for the design, manufacture, installation and
future servicing of the Equipment. The "turn key" nature of the
project was critical to Omega's bid selection. Beloit USA in
conjunction with Beloit Austria submitted a bid to Omega. Omega
informed Beloit Austria that it expected the winning bidder to
handle all aspects of the Equipment installation. Beloit Austria
represented that it had all the resources necessary to undertake
the project on such terms with the backing and support of the
Beloit group of companies.

On February 12, 1999, Omega and Beloit Austria executed a
contract at a price of approximately US $13,722,706 for the
construction and installation of the Equipment, to be operational
by March 27, 2000. In connection with the Contract, Beloit
Austria entered into a sub-contract with Beloit Poland under
which Beloit Poland would provide certain parts and technical
services required to install the Equipment.

The Pre-Petition Guaranty

On February 18, 1999, Omega received a guaranty from Beloit USA
assuring Omega that, in the event of an insolvency or bankruptcy
of Beloit Austria GmbH, Beloit USA shall assume the obligations
arising out of the contract.

On March 8, 1999, Mark E. Readinger, President and Chief
Operating Officer of Beloit USA and Senior Vice President of
Harnischfeger, sent a guaranty to Omega stating that
"Harnischfeger Industries, Inc. stands behind Beloit both
financially and otherwise. Omega also received, certain
performance guaranties from Creditanstalt Bankverein of Austria
collectively for approximately US $6,549,953.

On June 8, 1999, the Debtors filed their chapter 11 cases.
Concerned about Beloit Austria's ability to perform according to
the terms of the Contract, Omega sought from Beloit USA and
Harnischfeger post-petition guaranties that the Contract would be

Post-petition Guaranties

On August 11, 1999, Mark E. Readinger signed a guaranty on behalf
of Beloit USA and Harnischfeger guaranteeing Beloit Austria's
performance of the contract. Specifically, Beloit USA
unconditionally confirmed that in the event of an insolvency or
bankruptcy of Beloit Austria GmbH, Beloit USA shall assume the
rights and obligations of Beloit Austria GmbH arising out of the
contract and Harnischfeger guaranteed that it would make
commercially reasonable efforts to cause Beloit to perform its
obligations under this Guaranty. At the time Omega sought the
Post-Petition Guaranty, Beloit Austria was seeking certain
payments from Omega under the Contract. Omega was reluctant to
make such payments because of Beloit Austria's financial standing
and the Beloit's bankruptcy filings. Relying on the post-Petition
Guaranties by Beloit USA and Harnischfeger, Omega resumed making
monthly payments under the Contract.

Beloit Austria Liquidation

In November, 1999, Beloit Austria was placed into liquidation
proceedings under the laws of Austria and an Austrian Liquidator
was appointed. The Austrian Liquidator contacted Mr. Scott Baker,
Senior Vice President of Beloit USA, who stated, that Beloit USA
was prepared to provide funding of the completion of the

In December, 1999, Baker and Ross J, Altman, Senior Vice
President, General Counsel and Secretary of Beloit USA, met a
representative from Omega in Vienna, Austria and informed him
that Beloit USA would not advance any funds to Beloit Austria to
enable it to complete the Contract. Beloit USA also told Omega
that it was not going to honor its Guaranties and that Omega
should finish the Contract on its own.  

Omega contacted Debit Walmsley ("Beloit UK") to acquire parts
necessary to complete the project. Baker contacted the
administrators of Beloit UK and told them not to deal directly
with Omega as Beloit USA was going to complete the Contract.
Omega was subsequently informed by the administrators of Beloit
UK that Beloit USA had again changed its position and would not
fulfill its obligations under the Post-Petition Guaranty.

Presently, Omega is attempting to obtain substitute parts and to
complete installation of the Equipment. This has been hindered
by: (1) the unavailability of such specialized parts; (2) delays
by Beloit USA and Beboit Austria in providing Omega with the
designs and specifications necessary for the proper installation
of the Equipment; (3) the higher cost of substitute parts; (4)
the relative lack of expertise of Omega's staff in the
installation of the Equipment and (5) the fact that Omega's staff
is generally occupied with other matters. Omega contends that due
to Beloit Austria's liquidation, Beloit USA's failure to honor
the Post-Petition Guaranty and Omega's difficulties in finding an
alternative means of installing the Equipment, the project is
delayed and the March 27, 2000 operational deadline for the
Facility has been missed.

On March 2, 2000, Omega filed a complaint against Beloit USA,   
Harnischfeger and Messrs. Altman, Baker and Readinger based on
the Post-Petition Guaranty. The Complaint alleges, among other
things, that Beloit USA and Harnischfeger (1) breached the Post
Petition Guaranties; (2) tortiously interferred with Omega's
business; (3) breached the covenants of good faith; (4) committed
fraud in inducing Omega to make payment; and (5) made negligent
misrepresentations; and that Messrs. Altman, Baker and Readinger
committed, among other things, (1) fraud in the inducement; and
(2) negligent
misrepresentations. To the extent that Beloit USA and
Harnischfeger are found liable, Omega will have an administrative
claim against the Debtors' estates.

In January, 2000, the Austrian liquidator assigned to Omega all
of its rights to and under the Poland/Omega Contract. Since that
time, Omega has been dealing directly with Beloit Poland, and
Beloit Poland has been rendering performance under the
Poland/Omega Contract directly to Omega.

Omega claims that performance of the Poland Contract is critical
to completion of the Equipment, but with the uncertainty over
this matter pursuant to the proposed sale of Beloit Poland, Omega
wishes to put the Court on notice that the proposed Sale could
increase any administrative claim that it has against Beloit USA
and Harnischfeger. (Harnischfeger Bankruptcy News Issue 23;
Bankruptcy Creditors' Services Inc.)

HEDSTROM HOLDINGS: Committee Taps Whitman Breed
The Official Committee of Unsecured Creditors of Hedstrom
Holdings, Inc., et al., seek approval of the retention of Whitman
Breed abbott & Morgan LLP as cousnel to the Committee.  The
firm's hourly rates rnage from $100 to $140 for apralegals, from
$150 to $300 for associates and from $300 to $500 for members of
the firm.

Included among the services which the firm may be called upon to
render to the Committee are the following: advising the Committee
and representing it with respect to proposals and pleading
submitted by the debtors or others to the court or the Committee;
representing the committee with respect to any plans of
reorganization or disposition of assets proposed in these cases;
attending hearings, drafting pleadings and generally advocating
positions which further the interests of the creditors
represented by the Committee; assisting in the examination of the
debtors' affairs and review of the debtors' operations;
investigating any potential causes of action which any of the
debtors or the Committee may bring against any third-party;
advising the Committee as to the progress of the Chapter 11
proceedings; and performing such other professional services as
are in the interests of those represented by the Committee.

HVIDE MARINE: Alleged Improper Payments
According to an article in the Sun-Sentinel, Fort Lauderdale, FL
on May 17, 2000, a federal investigation into alleged improper
payments to union boss Walter J. "Buster" Browne caps a string of
problems for Hvide Marine Inc., a Port Everglades-based business
that used to be a Wall Street darling.

By last September, the company was so deeply in debt that it was
forced to seek protection from creditors under Chapter 11
reorganization in federal bankruptcy court. It emerged from
bankruptcy in December, but remained financially troubled.

Last month, Hvide named its third chief executive in less than a
year: Gerhard Kurz, 60, the recently retired president of Mobil
Shipping and Transportation Co., a Mobil Oil-affiliate.

Kurz already faces serious challenges. He must find a way to pre-
pay banks $ 60 million in principal by Jan. 1 to keep Hvide in
compliance with terms from loans. And now, he must contend with
charges that the company improperly paid out $ 60,000 to Browne
when his union could organize employees at the company.

INDIANHEAD MOUNTAIN:  Files for Chapter 11
An alpine resort in Big Snow Country, Indianhead Mountain,
operating since 1959, has filed for reorganization under Chapter
11 of the U.S. Bankruptcy Court in Marquette reported assets of
$ 4.2 million and liabilities of $ 4.3 million.

The company's closing and releasing of all employees last month
has left owners of ski houses and condominiums worried about
their futures. The reorganization bankruptcy is an effort of the
company to continue operating in business and to have a secure
time frame from the court to work with creditors, attorney David
McDonald Jr. told the AP.

INTEGRATED PACKAGING: Reports First Quarter 2000 Results
Integrated Packaging Assembly Corporation (OTC:IPAC), reported
its results today for the first quarter ended April 2, 2000.

Revenues for the first quarter ended April 2, 2000 were
$7,075,000 compared with revenues of $3,775,000 for the same
period a year ago. The Company reported a net loss of
($2,006,000) or ($0.04) per diluted share, for the first quarter
of 2000, compared with a net loss of ($3,425,000) or ($.24) per
diluted share, for the first quarter of 1999.

"We have made significant progress this quarter," said Patrick
Verderico, President and Chief Executive Officer. "Revenues in
the first quarter increased 87% over the same period a year ago
and the Company's operating loss declined by 48% versus the same
period a year ago. This is the first full quarter that the
results of OSE, Inc. (OSEI), our newly acquired distributor, have
been reflected in our results. OSEI had revenues of $1,679,000
and net income of $653,000 for the first quarter. IPAC has
benefited from the current strong semiconductor industry market.
With a continuing strong market coupled with our on-going
improvement programs, we expect additional revenue growth to
further us on our path to profitability."

IOWA SELECT: Moody's Downgrades Ratings
Moody's Investors Services downgraded to Ca from Caa1 the $130
million 11 3/4% senior subordinated notes, due 2005, co-issued by
Iowa Select Farms, L.P. ("Iowa Select") and ISF Finance, Inc.,
and downgraded to B3 from B2 the $170 million bank credit
facilities of Iowa Select. The company's senior implied rating
has been downgraded to Caa1 from B2, and its senior unsecured
issuer rating has been downgraded to Caa2 from B3.

The ratings downgrades reflect Iowa Select's weak operating
results, primarily due to an extended period of depressed hog
prices, along with productivity challenges in its operations. The
company is dependent on access to availability under the bank
facilities to cover its June 1, 2000, coupon payment on the
senior subordinated notes. The company defaulted under bank
facility financial covenants in 4Q99 and 1Q00. It obtained
waivers for 4Q99 but does not anticipate that a waiver will be
granted for 1Q00 that would permit payment of the senior
subordinated note coupon.

The bank facilities are secured. The working capital facility is
secured by receivables and inventory. The term loan by a first
priority lien on the company's real property, fixtures, machinery
and equipment. The $130 million senior subordinated notes are
unsecured and not guaranteed.

Iowa Select Farms, L.P., based in Iowa Falls, Iowa, is a leading
farrow-to-finish producer of hogs.

IRIDIUM: Motorola Takes $ 1.2 Billion Write-Off
Motorola Inc., according to the Arizona Republic dated May 17,
announced that it took a $1.2 billion write-off for its
investment in the satellite communications systems, Iridium LLC
that filed for bankruptcy protection last August after defaulting
on $ 1.55 billion in bank loans.

According to a filing with the Securities and Exchange
Commission, Motorola Inc., said it also used $56 million for cash
payments for operating costs associated with the wind-down of
Iridium operations debt guarantees and has $ 1.8 billion of
reserves set aside for Iridium charges as of December 31 and that
these are enough to cover its Iridium exposures.

JITNEY JUNGLE: Closes Two Stores
Jitney Jungle Stores of America, Inc. today announced the closure
of two grocery stores on Saturday May 20th, located at 3313 Lorna
Road, Hoover, AL., and 652 Montgomery Highway, Vestavia Hills,

Ron Johnson, President and Chief Executive Officer of JJSA, Inc.
said, "The exit from the Birmingham market through the closure of
these two grocery stores is part of our transition into a smaller
more viable company.  Our objective since the bankruptcy filing
back in October 1999, has been to use the reorganization process
to strengthen our business operation and this exit is an
important step in achieving this objective."

The company currently operates 140 grocery stores, 43 gas
stations and 10 liquor stores in Mississippi, Alabama, Louisiana
and Florida.

KEY PLASTICS: Response to Motion For Additional Committee
Bank One, Michigan, as agent for the senior secured lenders to
the debtors, responds to the emergency joint motion for  
appointment of an additional committee of creditors.

M.A. Hanna Resin Distribution Company and Motor City Mold, filed
a motion seeking to obtain an order from the court directing the
US Trustee to restructure the creditors' committee or appoint an
additional committee.  The creditors states that their interests
are no longer adequately represents.

The lenders object to the motion on the grounds that the
creditors failed to establish an absence of adequate
representation. The lenders state that there is no concrete
articulation of any "inherent conflicts" or "substantial
differences" between the Bondholders and the trade creditors and
that there is no showing of distinct or separate interests.

KOREAN AIR: Posts Loss, as Fuel Costs Soar
Korean Air Lines posted a first-quarter net loss of 41.7 billion
won ($37.2 million) and said the loss was mainly the result of
increased fuel prices. The South Korean flag carrier, which is
also struggling to recover from a long series of accidents and
safety problems, had a pretax quarterly loss of 56.5 billion won,
on revenue of 1.23 trillion won ($1.1 billion). Beginning this
year, all listed Korean companies are required to report
quarterly results.

MARINER: First Motion For Extension of Exclusivity
At the Committees' behest, the Debtors contracted their request
by approximately 30 days.  Accordingly, Judge Walrath granted the
Debtors an extension of their exclusive period during which to
file a plan of reorganization to August 15, 2000, and a
concomitant extension of their exclusive period during which to
solicit acceptances of that plan to October 16, 2000.
(Mariner Bankruptcy News Issue 5; Bankruptcy Creditors' Services,

MARKETING SPECIALISTS: Moody's Lowers Sr Subordinated Notes
Moody's Investors Service lowered the rating on Marketing
Specialists Corporation's $100 million senior subordinated notes
due 2007 to Caa3 from Caa2. Moody's also lowered the company's
senior implied rating to Caa1 from B3 and its unsecured issuer
rating to Caa2 from Caa1. The rating outlook is negative. This
rating action concludes the review that commenced on April 6,

The rating action was prompted by the continuing weakness in the
company's operating performance following the August 1999 merger
of Merkert American and Richmont Marketing Specialists to form
the present company, and our expectation that even if operating
performance improves in coming periods leverage will remain very

Ratings continue to reflect the company's highly leveraged
financial condition, the industry's traditionally modest margins,
and manufacturer's pricing pressure that may further depress
margins. Additionally, the ratings consider that the company has
not achieved merger synergies as quickly as anticipated due to
unexpected client losses and slow overhead reductions.

However, the ratings recognize Marketing Specialist's
longstanding relationships with many important vendors and
retailers and the significant proportion of vendor/retailer sales
volume that the company often represents. The company's strategy
of growth through acquisition has improved geographic diversity
to achieve coverage across most of the country. Finally, equity
infusions have moderated leverage increases.

The Caa3 rating on the senior subordinated notes recognizes that,
while these are guaranteed by the company's subsidiaries, they
are subordinated to a significant amount of secured debt
including the bank facility and mortgage obligations. The senior
subordinate notes also rank equally to a sizable amount of
acquisition obligations. In a distressed scenario, we believe
that the senior subordinated notes would be moderately impaired.

The negative rating outlook reflects considers our belief that
the company may be unable to effectively leverages its costs
through winning profitable new business significantly in excess
of lost contracts.

Prior to the August 1999 merger, both companies had followed a
strategy of expansion through acquisition of small food brokers;
the combined entity has continued to expand geographic coverage
through small acquisitions. To induce the previous owners of
acquisitions not to compete, many of the deals were structured so
that non-compete agreements and deferred compensation will be
paid out over time. Required principal payment equals about $17
million in 2000 with similar amounts due in following years. We
believe that cash interest payments plus principal payments for
non-compete contracts and deferred compensation will demand a
significant portion of the company's free cash flow for the next
several years.

Several of the company's largest customers were lost to
competitors in the initial months following the August 1999
merger. More recently, the company has won significant new
contracts which may offset much of the lost revenue over the
course of the next year. The recent refinancing of the company's
bank facility increased borrowing capacity from $68.8 million to
$85.0 million. Provision was also made for debt baskets that
could increase debt by an additional $30.0 million (including $20
million incurred with the April 2000 acquisition of Sales Force);
beyond this, the company must match debt increases with new
equity. Since the beginning of the year, the largest owner of the
company has contributed $15.0 million in additional equity.

For the twelve months ending March 1999, EBITDA covered interest
expense about 1.0 times and adjusted debt to EBITDAR was
approximately 11.7 times. Following the seasonal peak during the
final quarter of the year, interest coverage during the first
quarter of 2000 fell to 1.0 times versus coverage of 1.6 times
during the fourth quarter of 1999. At least part of this decline
can be attributed to gap in net contract revenues as the company
focused on merger integration.

Marketing Specialists Corporation, headquartered in Dallas,
Texas, provides brokering services to food and consumer products
manufacturers across the United States.

MOSSIMO: Big Board to Suspend Mossimo
The Wall Street Journal reports on May 23, 2000 that
the New York Stock Exchange said trading in Mossimo Inc., which
resumes today, will be suspended before the opening of trading

The Big Board will apply to the Securities and Exchange
Commission to delist the sportswear designer.

The exchange attributed its decision to Mossimo's falling below
its continued listing criteria..

On May 17, Mossimo, Irvine, Calif., said three companies filed an
involuntary petition against it under the U.S. Bankruptcy Code.

PHC INC: Reports Net Loss for the Quarter
PHC, Inc. is a national health care company specializing in the
treatment of substance abuse, which includes alcohol and drug
dependency and related disorders, and in the provision of
psychiatric services. The company currently operates two
substance abuse treatment facilities: Highland Ridge
Hospital, located in Salt Lake City, Utah; and Mount Regis
Center, located in Salem, Virginia, near Roanoke and eight
psychiatric facilities: Harbor Oaks Hospital, a 64-bed
psychiatric hospital located in New Baltimore, Michigan; Harmony
Healthcare, a provider of outpatient behavioral health
services at two locations in Las Vegas, Nevada; Total Concept
EAP, a provider of outpatient behavioral health services in
Shawnee Mission, Kansas; and North Point-Pioneer, Inc. which
operates four outpatient behavioral health centers under the name
Pioneer Counseling Center in the greater Detroit metropolitan

The company also operates BSC-NY, Inc., which provides management
and administrative services to psychotherapy and psychological
practices in the greater New York City metropolitan area. Through
its subsidiary, Behavioral Health Online, Inc., the company
operates its web site,, which offers
behavioral health education, training and products for the
behavioral health professional.

The company reports net revenues of $4,488,751 for the quarter
ended December 31, 1999 and $8,871,560 for the six months ended
on that date.  Net losses were $578,165 for the quarter and
$638,117 for the six month period.

In the similar periods ended December 31, 1998 the company, in
its restated financial reports, netted revenues of $4,750,350 for
the quarter and $9,661,645 for the six months.  The net losses
were $1,073,167 for the 1998 quarter cited, and a net loss of
$1,059,694 for the restated six month 1998 period.

PRINCETON HOSPITAL: Lakeside Alternatives Acquires Company
On May 17, 2000, The Orlando Sentinel reports that bankrupt
Princeton Hospital will go to Lakeside Alternatives Inc., the
company which originally lost to Morningstar Healthcare LLC of
Little Rock in a $4.2 million bid two weeks ago.

When Morningstar's lawyer failed to produce money Tuesday, last
week at a bankruptcy court hearing, a judge quickly awarded
Princeton to Lakeside which offered to pay $3.9 million --
$400,000 more than its original offer.

About $2 million of the purchase price is expected to cover
administrative claims, including about $288,000 in unpaid wages
to 203 former Princeton workers. Another $1.2 million will go to
Naples Lending Group LC, which loaned the hospital money to cover
operating costs after it filed for reorganization. The remaining
$700,000 will go to the Bank of New York, which represents
bondholders of $45 million in Princeton debt.

SC NEW HAVEN: Order Confirms Joint Plan of Liquidation
The Honorable Peter J. Walsh, entered an order on May 2, 2000,
confirming the second amended joint plan of liquidation, as
modified, filed by SC New Haven Corporation (f/k/a Starter
Corporation) and its debtor affiliates.

SERVICE MERCHANDISE: Renders Monthly Operating Report
Service Merchandise Company, Inc., acting as debtor-in-
possession, rendered its monthly operating report for the period
2/28/00 to 04/02/00 in which it stated total revenues of $147,474
and a net loss of $10,844.

SOUTHERN MINERAL: Order Approves Disclosure Statement
The US Bankruptcy Court, Southern District of Texas, Victoria
Division entered an order on May 2, 2000, approving the
Disclosure Statement of the debtors, Southern Mineral Corporation
and its debtor affiliates.  A confirmation hearing will be held
on June 30, 2000 at 9:30 AM.

STONE & WEBSTER: Stock Trades on OTC Board and NGB 'Pink Sheets'
Stone & Webster, Incorporated (OTC Bulletin Board: SWBI)
announced that the Company's stock is trading as an over-the-
counter ("OTC") equity security under the symbol "SWBI."
Quotation service is provided by the OTC Bulletin Board
and the National Quotation Bureau, LLC "Pink Sheets."  Market
makers are providing orderly trading of the stock.  Investors
should call their brokers for daily pricing and volume

As previously announced on May 8, 2000, Stone & Webster has
signed a letter of intent with Jacobs Engineering Group Inc.
(NYSE: JEC) regarding a proposed transaction pursuant to which
Jacobs would acquire substantially all of Stone & Webster's
assets in exchange for $150.0 million in cash and stock, and the
assumption of substantially all of the Company's liabilities
shown on its March 31, 2000 balance sheet, standby letters of
credit, and its liabilities under a new credit facility entered
into on May 9, 2000 pursuant to which up to $50.0 million of
credit is being made available to the Company. The $50.0 million
credit facility is intended to enable the Company to address its
current liquidity difficulties and continue to operate its
business until the asset sale is consummated.  In addition, in
conjunction with and as a condition to these proposed
transactions with Jacobs, Stone & Webster intends to file a
voluntary petition for reorganization under Chapter 11 of the
U.S. Bankruptcy Code after it signs a definitive sale agreement
with Jacobs, which is expected to occur later this month.  
Subsequent to making these announcements, Stone & Webster was
notified by the New York Stock Exchange that it had suspended
trading in the Company's common stock and would apply to the
Securities and Exchange Commission to delist the stock.

Stone & Webster fully expects to continue operating its
businesses in the normal course both before and during the
Chapter 11 process.  The Company and Jacobs have had discussions
with many Stone & Webster clients about continuing their work
without interruption.  The Company's operations have remained
functional and its employees are expected to transition smoothly
into the Jacobs organization.

As Stone & Webster has previously stated, because the proposed
sale of assets is expected to occur in the context of a pending
Chapter 11 case, it is not possible to determine at the present
time what value, if any, will ultimately be received by Stone &
Webster's stockholders.  Such a determination can only be made
after negotiation of a definitive sale agreement, the completion
of the competitive bid process provided for under Chapter 11,
consummation of the asset sale transaction, and the substantial
resolution of Stone & Webster's contemplated Chapter 11 case.

Stone & Webster is a global leader in engineering, construction
and consulting services for power, process/industrial and
environmental/infrastructure markets.

SUN HEALTHCARE: Seeks To Spend $3.7MM For New Network Equipment
The Debtors tell Judge Walrath that the computer,
telecommunication and networking equipment leased from Oliver-
Allen by  Regency Health Services, Inc. and Sun is obsolete and
of poor quality, and is incompatible with the "ORCAS" system, a
modern and sophisticated software application which the Debtors
plan to implement in all of their facilities no later than the
fourth quarter of this year. Moreover, the Leases require high
maintaining cost.

The Debtors explain that Oliver-Allen Leases do not provide for
the option to purchase or buy-out the leased equipment at the end
of the lease term. New equipment must therefore be purchased or
leased for replacement if the Leases are not renewed upon
expiration. The Oliver-Allen Leases have different initial terms,
the earliest of which will expire on May 30, 2000, and the
longest term will expire on February 28, 2003.

If the Leases are not rejected before they expire:

(a) the aggregate lease payments will be approximately
$10,397,000, which has a 10% discounted present value of
approximately $9,088,000, if all expiring Leases are renewed
until February 28, 2003;

(b) the aggregate payments will approximate $3.63 million, which
means a discounted present value of about $3.4 million, if the
Leases are not renewed upon expiration of initial terms.

The estimated cost for the new ORCAS compatible equipment for
installation in the Regency facilities is approximately $3.7
million. By comparison, if the Debtors use the Oliver-Allen
equipment for ten months, the lease payments will aggregate over
$3.8 million. It clearly makes good business sense, the Debtors
say, to purchase/lease new equipment which is ORCAS-compatible
and to reject the Leases.

Attending to the cost of deinstallation of the old leased
equipment and installation of the new equipment, the Debtors say
this is unavoidable because it will occur upon termination of the
Leases, whether such termination is due to rejection or expiry.
The Debtors expect this to be an amount up to $838,000. The de-
installation and installation process, the Debtors anticipate,
will take about one month for all of the Regency facilities.

The Debtors tell the Judge that with a view to replace the
equipment, they have obtained competitive quotes from several
vendors, including Inacom Corp., Comdisco, Compucom and Microage.
After a thorough review and comparison of price quotes and other
factors, such as the vendors reputation in the industry and their
performance records, the Debors have chosen Inacom because it
proposed favorable terms and is a highly reputable company.

The Debtors believe that the estimated cost of $3.7 million is
reasonable, and represents an expenditure that will benefit their
estates and creditors.

Under an agreement signed by SunBridge Healtheare Corporation and
Inacom, Inacom agrees to provide services and products to
Sunbidge and its affiliates.

Judge Walrath grants the Debtors' motion for the rejection of the
Leases, pursuant to section 363(b) of the Bankruptcy Code, and
authorizes for the purchase of new equipment for replacement.
(Sun Healthcare Bankruptcy News Issue 11; Bankruptcy Creditors'
Services Inc.)

THIS END UP: Not All Customer Orders Will be Filled
The Associated Press reports on May 17, 2000 that customers of
This End Up, the bankrupt company which has thousands of orders
totaling roughly $24 million that remain unfilled, must wait two
or three more weeks to find out whether they will get the
furniture they ordered.

"Right now we are pulling all of that information together so we
can get a fix on what will get shipped and what will not be
shipped," said Richard A. Sebastiao, president of RAS Management
Advisors, the turnaround specialists hired by This End Up.  

One thing is for sure, he said: Not all of the orders will be

United States Exploration, Inc. (ASE:UXP) announced that it has
completed the settlement of its obligations to its principal
lender, ING (U.S.) Capital LLC.

At March 31, 2000, the Company owed ING $31,250,000, plus accrued
interest of approximately $2,222,500. These obligations were
settled on May 18, 2000, for an aggregate payment of $17,000,000.

The Company obtained the funds to effect the settlement from
several sources. First, the Company sold its interests in 60
producing wells and associated undeveloped acreage in the
Wattenburg field of Northeastern Colorado to an unaffiliated oil
and gas company for approximately $7.15 million, subject to
customary adjustments. Second, the Company sold 3,000,000 shares
of its common stock to Bruce D. Benson, its chairman of the
board, chief executive officer and president, for $1.10 per
share, or a total of $3.3 million. Third, Benson Mineral Group,
Inc. ("BMG"), a private company owned by Mr. Benson, provided $4
million in debt financing to the Company. The balance of the
payment to ING was made from internally generated Company funds.

The shares purchased by Mr. Benson were issued pursuant to an
agreement entered into on April 21, 2000. The closing price of
the Company's common stock on April 20, 2000, was $0.56 per
share. Pursuant to that agreement, at the time the shares were
purchased, Mr. Benson's employment agreement was amended to
extend its term for an additional year, or until August 6, 2001,
and Mr. Benson voluntarily relinquished options to purchase
4,000,000 shares of common stock that were granted pursuant to
his employment agreement. The amendment also provides for a
severance payment of $1 million to Mr. Benson in the event that
he is terminated by the Company without cause prior to the end of
the term of the agreement, a majority of the board of directors
changes during the period or the Company defaults under the

The proceeds of the debt financing provided by BMG were paid
directly to ING and ING assigned to BMG the Note, Credit
Agreement and related security documents entered into in
connection with the ING loan. Upon that assignment, BMG and the
Company entered into an amendment to the Credit Agreement and the
Note that reduces the outstanding principal balance of the Note
to $4 million, forgives all interest and fees accruing prior to
the date of the amendment, provides for interest on the reduced
principal amount at 9% per annum and requires the Company to pay
the Note in a lump sum no later than May 17, 2001. In that
amendment, the Company acknowledges that the financing was
provided by BMG as an accommodation and agrees to use its best
efforts to refinance or otherwise prepay the Note as soon as
possible. The Company intends to seek financing from a bank or
other lender to pay the Note held by BMG and to provide
funds for the further development of its properties. In addition,
the Note may be paid from Company cash flow or the proceeds of
additional property sales.

The Company had previously announced a letter of intent with a
lender to provide the funds necessary to settle with ING and to
develop its properties. The Company decided not to complete that
financing because the terms of the transactions described above
were significantly more favorable to the Company. The lender
would have required a 6% overriding royalty on all of the
Company's Colorado properties, in addition to interest at 10% per

At March 31, 2000, the Company had a stockholders' deficit of
approximately $ 4.55 million. If the ING settlement and related
transactions had been effected as of that date, the Company would
have had stockholders' equity of over $14 million. The Company
estimates that the operating cash flow from the properties
sold was approximately $423,000 in the quarter ended March 31,
2000, or approximately 25% of total operating cash flow for the
quarter. However, the cash savings to the Company of the
transactions described above, as compared to the 6% overriding
royalty interest and other costs of the proposed lending
arrangements previously announced, approximately offset the
reduction in operating cash flow from the properties sold. In
addition, with only $4 million of debt, as compared to $31.25
million under the ING loan or $12 million under the alternative
proposed lending arrangement, the Company is in a much stronger
financial position. The Company had been accruing interest at the
rate of over $ 300,000 per month at the default rate on the ING
loan. Interest accruals under the interim loan will be $30,000
per month.

Mr. Benson said: "We are glad to have resolved the uncertainty
that the Company has faced for the last 18 months. With our much
stronger balance sheet and continuing cash flow, we are confident
that we will be able to obtain the financing necessary to pay off
the bridge loan from BMG and pursue an aggressive development
program to realize the full potential of our properties. We look
forward to the future with great enthusiasm and optimism."

United States Exploration, Inc. is engaged in the acquisition,
exploration, development, production and marketing of natural gas
and crude oil in North America. The Company's principal reserves
and producing properties are located in northeast Colorado. The
Company's common stock trades on the American Stock Exchange
under the symbol UXP.

US LEATHER: Seeks to Liquidate Milwaukee Properties
United States Leather Inc. said it planned to seek permission in
U.S. Bankruptcy Court to put two former tanneries on the market
in an effort to liquidate its assets here.

"They are getting ready to put everything up for sale," company
spokeswoman Linda Stephenson said Monday.

The company, which earlier filed for protection from creditors
under Chapter 11 of the U.S. Bankruptcy Code, was scheduled to
seek permission for the sales at a hearing today.

The company put nearly 600 employees out of work in February when
it shut down the Pfister & Vogel and A.L. Gebhardt tanneries.

Workers were given only two days' notice of the plan to close the
plants, which produced leather for footwear and other items.
State law requires a 60-day notice for mass firings or layoffs.

The U.S. Labor Department last month approved additional benefits
for the fired employees under a special aid program related to
the North American Free Trade Agreement, after it found imports
from Mexico had contributed to the tannery closings.

The additional federal assistance may allow workers to get up to
78 weeks of unemployment compensation, instead of 26, and may
provide them with 104 weeks of job training.

VENCOR: Court Approves Fifth Amendment To DIP Facility
Under a Fifth Amendment to the DIP Credit Agreement, the DIP
Lenders agree to extend the Stated Maturity Date to June 30,
2000, providing Vencor with additional time to continue
negotiations on a plan of reorganization.  

The Debtors and the Lenders agree to reduce the Borrowing Base
from $75,000,000 to $67,842,286.  That amount is the level of the
Tranche A Commitments on February 23, 2000, taking account of
Commitment reductions to date in connection with Asset Sales.  
Additionally, the Debtors agree to provide the Lenders with a
monthly Eligible Receivables Report to help the Lenders calculate
the Effective Borrowing Base under the DIP Credit Agreement.  
Further, the Debtors covenant that the Net Amount of Eligible
Accounts will not fall below $350,000,000 at any point in time.  

The Debtors agree to pay a $400,000 Extension and Amendment Fee
to the DIP Lenders in consideration of the Fifth Amendment and
various non-material modifications contained in the Fourth

The Debtors agree that Consolidated EBITDAR, calculated on a
cumulative basis from March 1, 2000, shall be no less than:

       Month Ending               Minimum Cumulative EBITDAR
       ------------               --------------------------
       March 2000                       $25,000,000
       April 2000                       $55,000,000
       May 2000                         $89,000,000
       June 2000                       $119,000,000

Capital Expenditures shall be limited, on a cumulative basis from
March 1, 2000, to:

       Month Ending               Maximum Cumulative CapEx
       ------------               ------------------------
       March 2000                       $10,000,000
       April 2000                       $17,000,000
       May 2000                         $24,000,000
       June 2000                        $31,000,000

The Lenders consent to the Debtors' sale of 70 vehicles
associated with the Vencare business line and the sale of two
durable medical equipment storefronts previously associated with
the Vencare business.  

Operationally, the Debtors covenant that their Hospital Census
will not fall below:

       Month                   Minimum Daily Hospital Census
       -----                   -----------------------------
       March 2000                          2,830
       April 2000                          2,750
       May 2000                            2,650
       June 2000                           2,570

Joel B. Zweibel, Esq., of O'Melveny & Myers LLP serves as counsel
to the DIP Lenders; Karen Wagner, Esq., of Davis Polk & Wardwell
represents Morgan Guaranty Trust Company of New York.

Judge Walrath approved this Fifth Amendment in all respects.  
(Vencor Bankruptcy News Issue 12; Bankruptcy Creditors' Services


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