TCR_Public/000712.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, July 12, 2000, Vol. 4, No. 135


AMERICAN ARCHITECTURAL: Continues Discussions With Noteholders
APB ONLINE: Seeks Investment from Media Companies
ARM FINANCIAL GROUP: Disclosure Statement Approved
BABCOCK & WILCOX: Receives $20MM Contract from Fortum Engineering
CONTOUR ENERGY: Annual Meeting of Stockholders

COSTILLA ENERGY: Disclosure Statement Hearing
COSTILLA ENERGY: Order Authorizes Payment of Principal Amount
DEPOSITORY PRODUCTIONS: Involuntary Case Summary
DIMAC HOLDINGS: Bar Date Fixed As Of September 1, 2000
EAGLE FOOD: Court Confirms Amended Reorganization Plan

FORCENERGY: Forest Oil Offer $615 Million In Stock
FREDERICK'S OF HOLLYWOOD: Files For Bankruptcy Reorganization
FRUIT OF THE LOOM: Farley's Motion For Protective Order
GENESIS/MULTICARE: Multicare Taps Young Conaway as Local Counsel
GREAT TRAIN STORE: Rejection of Leases

HARNISCHFEGER: Seeks To Select Agent To Sell Asia Pulp Note
HARVARD PILGRIM:  Medicare Program To End For 11,000 Seniors
JENNA LANE: Files for Chapter 11 Reorganization
KENETECH: Annual Meeting Set For August 23, 2000
LOEWEN: Applicants' Third Motion For Extension of CCAA Stay

MASTER GRAPHICS: Receives Court Approval of First-Day Orders
NETWORK SYSTEMS: Announces Sale of Its Common Stock
PRANDIUM: Completes Sale of El Torito Division
PRIMARY HEALTH: Joint Motion To Extend Co-Exclusive Periods
RELIANCE LIFE: S&P Lowers Ratings to 'Bpi'

ROBERDS: Motion For Authority To Sell Remaining Leases
SAFETY-KLEEN: Applies To Employ Shaw Pittman as Special Counsel
SILVER CINEMAS: Taps Haynes and Boothe LLP as Special Counsel
SOGO: Government Bail Out Proposed

TITAN ENERGY: Customer Accounts To Be Auctioned
TRI VALLEY GROWERS: Taps Investment Firm
TRI VALLEY GROWERS: To Facilitate Restructuring Thru Chapter 11
WAXMAN INDUSTRIES: Announces Financial Restructuring Agreement
WESTERN DIGITAL: Offers 4.1 Million Shares of Common Stock


AMERICAN ARCHITECTURAL: Continues Discussions With Noteholders
American Architectural Products Corporation (OTC Bulletin Board:
AAPCE) announced continuing discussions with holders of its
11.75% Senior Notes due 2007 ("Senior Notes") regarding a
potential consensual restructuring of AAPC's indebtedness. AAPC
had previously announced its election to enter the 30-day grace
period as provided for in the Indenture for the Senior Notes and
to defer the payment of $7.3 million of interest on the Senior
Notes otherwise payable on June 1, 2000.

In light of the expiration of the 30-day grace period, AAPC is
working with noteholders to enter into standstill agreements
pursuant to which the noteholders would refrain from taking
certain enforcement actions during the agreed standstill period.
These standstill agreements would facilitate the process of
formulating a consensual plan for restructuring the Senior
Notes with the goal of payment of AAPC's trade creditors in full
and on a timely basis and will not require employee layoffs. So
far, noteholders representing approximately $32 million in
principal amount of the Senior Notes have executed standstill
agreements, and AAPC anticipates that standstill agreements will
be secured from a substantial majority of the noteholders.

During the standstill period AAPC will continue to work with its
financial advisor, Banc of America Securities LLC, to consider
options relating to refinancing, raising new capital,
restructuring existing funded debt obligations and potential
sales of non-core assets. AAPC will also continue to pursue the
possible refinancing of its senior secured bank revolver.

"We continue to be encouraged by our discussions with noteholders
and prospective new bank lenders," said Joseph Dominijanni,
Interim President and CEO of AAPC. "The standstill agreements
that we are negotiating with our noteholders would allow us to
continue working with these noteholders to formulate a sensible,
workable restructuring plan. We are optimistic that we will be
able to enter into standstill agreements and continue productive
discussions with a substantial portion of our noteholders as we
work to resolve this situation promptly."

The Company continues to have availability ranging from $5 to $7
million on its senior secured bank facility, and there are no
current unwaived defaults under that facility.

APB ONLINE: Seeks Investment from Media Companies
APB Online Inc., which reported total assets and liabilities of
$3.27 million and $8.2 million respectively, in its Chapter 11
filing in the U.S. Bankruptcy Court in New York last week, is
seeking investors who wants to acquire an interest in the
company, said Chairman Marshall V. Davidson.  

According to an affidavit filed in the bankruptcy court, the
company officials have had recent discussions with several media
companies but the chairman refused to specify which companies
were interested.  The two-year-old company has already gone
through $27 million in cash from investors and needs to raise
another $15 million to reach its break-even point by 2002.

ARM FINANCIAL GROUP: Disclosure Statement Approved In July 5
Arm Financial Group's disclosure statement was approved in a July
5 hearing in the U.S. Bankruptcy Court for the District of
Delaware, advancing the company's Chapter 11 liquidation plan.
District Court Judge Peter J. Walsh heard the case.  

The company will be back in Delaware's bankruptcy court on Aug.
21 for a hearing on the liquidation plan.  Arm voluntarily
initiated a Chapter 11 filing on Dec. 20, 1999, and in March sold
its subsidiaries, Integrity Life Insurance Co. and National
Integrity Life Insurance Co., to Western & Southern Life
Insurance Co., Cincinnati, for an estimated $119 million.  The
plan provides for liquidation of all of the company's remaining
assets and for distribution of liquidation proceeds to its
creditors and preferred shareholders.  (Bestwire 07-July-00)

BABCOCK & WILCOX: Receives $20MM Contract from Fortum Engineering
McDermott International Inc. announced that its wholly-owned
subsidiary, the Babcock & Wilcox Co. unit received a $20 million
contract from Fortum Engineering Ltd.'s Fortum Engineering Polska
Sp. z.o.o. unit to supply a coal-fired circulating fluidized-bed
boiler island to the new Tychy II power plant project in Tychy,
Poland.  Its capacity boiler is equivalent to 90 megawatts.  The
project features Babcock's third-generation internal
recirculating boiler design and also includes construction and
balance of boiler plant equipment.

As reported earlier, power plant builder Babcock & Wilcox sought
Chapter 11 bankruptcy protection on Feb. 22 in the U.S.
Bankruptcy Court for the Eastern District of Louisiana in New

CONTOUR ENERGY: Annual Meeting of Stockholders
Contour Energy will hold the annual meeting of stockholders in
the Park Avenue Room (Lobby Level) of the Hotel Inter-
Continental, 111 East 48th Street, New York, New York 10017, at
10:30 a.m. New York time on Tuesday, July 25, 2000.

At the meeting stockholders will elect a Board of Directors
comprised of seven members, plus two additional members that will
be elected by holders of the company's outstanding preferred
stock.  Also any other  business matter that properly comes
before the meeting will be considered.

Stockholders of record as of the close of business on Friday, May
26, 2000 are entitled to notice and to vote at the meeting.

COSTILLA ENERGY: Disclosure Statement Hearing
Costilla Energy Inc. filed its Disclosure Statement with respect
to debtor's plan of reorganizaiton (Liquidation) as amended on
July 7, 2000.  The court has set July 18, 2000 as the deadline
for filing any objects to the Disclsoure Statement.   The hearing
to approve the Disclosure Statement has been set for July 20,
2000 at 9:30 AM, US Bankruptcy Court for the Western District of
Texas, 615 E. Houston, San Antonio, Tx 78205.

COSTILLA ENERGY: Order Authorizes Payment of Principal Amount
By order entered on July 5, 2000, Costilla is authorized at its
discretion to pay the undisputed portion of the $26,452,852
principal amount of the Bank's Claim.

DEPOSITORY PRODUCTIONS: Involuntary Case Summary
Alleged Debtor: Depository Productions, Inc.
                826 Broadway
                New York, NY 10003

Involuntary Petition Date: July 7, 2000

Case Number: 00-41718            Chapter: 11

Court: Southern District of New York

Judge: Prudence Carter Beatty

Petitioners' Counsel: Heidi L. Snyder
                      McAuliffe & Assoc., P.C.
                      430 Lexingon Street
                      Newton, MA 02466
                      Tel:(617) 558-6889


Dan Ionescu
Architects        Architectural Services       $ 35,000

Erv Schultz       Unpaid consulting fees and
                  unreimbursed expenses        $ 26,019

SOP Acquisition
Corp.             Loan                          $ 3,500

RMB Marketing
Corp.             Loan                          $ 1,500

DIMAC HOLDINGS: Bar Date Fixed As Of September 1, 2000
By order entered on June 28, 2000, the US Bankruptcy Court for
the District of Delaware entered an order fixing September 1,
2000 as the last date for filing general proofs of claim.
Proofs of claim will be deeemd timely filed only if actually
received by DIMAC Claims Docketing Center on or before the Bar

EAGLE FOOD: Court Confirms Amended Reorganization Plan
Eagle Food Centers Inc., which filed for Chapter 11 bankruptcy
protection on Feb. 29, announced that the U.S. Bankruptcy Court
for the District of Delaware has confirmed its first amended
reorganization plan.  Under the plan, the senior noteholders will
get new senior notes due April 15, 2005 with an interest rate of
11% and a $15 million reduction of outstanding principal under
the plan's effective date.  The company said it has already
restructured its 8 5/8% senior notes dues April 15, 2000
according to its consensual agreements with about 29% of its
largest institutional holders.

Moreover, the company also rejected or terminated leasehold
interests in certain non-operating or underperforming stores.

FORCENERGY: Forest Oil Offer $615 Million In Stock
According to an article in The Financial Post on July 11, 2000,
Forest Oil Corp., a natural-gas and oil exploration company,
agreed to buy rival Forcenergy Inc. for about US$615-million in
stock to add wells in Alaska and the Gulf of Mexico, the two
biggest producing regions in the United States.

Forest will swap 1.6 shares for each Forcenergy share. That
values Forcenergy at US$25.60 a share, 21% more than Friday's
close. Forest holders will own 56% of the new company.

Forest said that it plans to rejuvenate drilling projects in the
Gulf of Mexico that Forcenergy curtailed in 1998 because of low
oil prices. Forcenergy also is developing oil deposits in the
Northwest Territories and has an oil field in Alaska.

Miami-based Forcenergy came out of Chapter 11 bankruptcy
protection in February. Denver-based Forest said the purchase
will immediately boost cash flow, almost double the company's
reserves to 1.41 trillion cubic feet of oil and gas, and more
than double its daily production to 490 million cubic feet.

John Selser, an analyst at RBC Dominion Securities in Houston was
quoted as saying that Forcenergy has a bit of a stigma from its
financial history but it's got a great base of assets in the Gulf
of Mexico.  He rates Forcenergy a 'strong buy' and said he may
raise his 'outperform' on Forest.

Forest's reserves will be about 59% natural gas and 41% oil,
compared with the current ratio of 73% gas and 27% oil.

Both companies' boards approved the takeover, and shareholders
representing about 67% of Forcenergy and about 37% of Forest
agreed to vote for it, the companies said.

Robert Boswell, Forest chairman and chief executive will retain
his positions at the combined company. Richard Zepernick Jr.,
Forcenergy chief executive, will be president and chief operating

FREDERICK'S OF HOLLYWOOD: Files For Bankruptcy Reorganization
According to a report in The Wall Street Journal on July 11,
2000, lingerie maker Frederick's of Hollywood Inc. filed for
bankruptcy reorganization.

In documents filed for its Chapter 11 case, the closely held
retailer says it has been unable to push up its earnings or
expand operations largely because of the lingering cost of its
1997 leveraged buyout. The bankruptcy filing, along with new
financing, will allow the company to firm up its cash flow and
move ahead with a planned makeover designed to de-emphasize the
more risque side of its business, executives say.

"There was some raunchy imagery . . . it was pretty tarnished at
one point in time," says the chief executive officer of
Frederick's, Linda LoRe.

In its filing, the company argues that its financial support
remains solid, despite heavy debts and an unresolved dispute with
its former auditor.

In the filing, Frederick's lists assets of about $66 million,
including a value of $32.8 million assigned to trademarks and
other intellectual property. The company also projects revenue of
about $140 million for the fiscal year ending July 31, and
officials say it will generate operating profit of $5 million to
$6 million before making debt payments.

Liabilities total about $67 million. The filing calls the biggest
chunk of debt, $32 million, "allegedly secured" and says it is
owed to a group of banks including Credit Agricole Indosuez.

Last month, Frederick's was bought by Wilshire Capital LLC, a Los
Angeles investment firm. Previously, Frederick's was privatized
by Chicago investment group Knightsbridge Capital Corp.
Knightsbridge executives didn't return phone calls. The company
will continue operating normally through the bankruptcy
proceedings, officials said.

FRUIT OF THE LOOM: Farley's Motion For Protective Order
William Farley tells Judge Walsh that is more than willing to
cooperate with the Debtors and the Committee in the Rule 2004
Examination process.  To facilitate the free exchange of
information, Mr. Farley asks Judge Walsh to enter a protective
order allowing he and his counsel to designate any personal
document that he or another party may produce as confidential.  

Additionally, Mr. Farley complains to Judge Walsh, he is confused
by the precise meaning of the words "document," "concerning," and
"time frame," as they are used by the Debtors in the request for
production of documents served on him by the Debtors.  Mr. Farley
asks that Judge Walsh direct the Debtors to refine the meanings
of those vague words.  

Nonsense, Fruit of the Loom says in response. There is
$65,000,000 at stake and any privacy concerns Mr. Farley may have
are trivial in comparison.  Mr. Farley wants the power designate
documents as confidential in an arbitrary fashion, the Debtors
observe, and there are several problems with this.  Mr. Farley
gives no definition or criteria on which he will base his
decisions to declare a document as confidential.  Fruit of the
Loom is a public firm, the loan guaranty is reported in public
filings and the collateral pledge is disclosed in public
Securities and Exchange Commission documents.  Fruit of the Loom
states that its proposed confidentiality order provides all
parties with adequate privacy.

Fruit of the Loom directs Judge Walsh's attention to Cipollone v.
Liggett Group Inc., 785 F.2d 1108, 1121 (3rd Cir. 1986), teaching
that, "an applicant for a protective order whose chief concern is
embarrassment must demonstrate that the embarrassment will be
particularly serious.  The business must show that the
embarrassment would cause significant harm to its competitive and
financial position."

Mr. Farley's request for permission to designate documents
produced by other parties as confidential is even more
inappropriate, the Debtors say.  Fruit of the Loom relates that
it has fulfilled numerous document requests from Mr. Farley.  
Accordingly, Mr. Farley could designate public company documents
as confidential when they were never intended as such.  Mr.
Farley would essentially be given control over the entire
discovery process, the Debtors argue.  

Considering the parties' arguments, Judge Walsh ruled that Mr.
Farley will be free to designate any document as confidential
during the examination process.  The Debtors -- any every other
party-in-interest -- with have the right to challenge that
designation.  Judge Walsh indicated that he is confident that
Mr. Farley and Mr. Farley's counsel would not engage in the type
of game-playing the Debtors describe in their response. (Fruit of
the Loom Bankruptcy News Issue 8; Bankruptcy Creditors' Service

GENESIS/MULTICARE: Multicare Taps Young Conaway as Local Counsel
The Multicare Debtors seek to employ and retain Young Conaway as
its local counsel, effective as of the Petition Date.

The Debtors selected Young Conaway because of the firm's
extensive experience and knowledge and because of its expertise,
experience and knowledge with respect to practice before the
Bankruptcy Court in Delaware, its proximity to the Court, and its
ability to respond quickly to emergency hearings and other
emergency matters in this Court.

Moreover, Young Conaway has become familiar with the Debtors'
businesses and affairs and many of the potential legal issues
which may arise in the context of Multicare's chapter 11 cases.

The Debtors contemplate that Young Conaway will:

(1)   provide legal advice with respect to the Debtors' powers
and duties as debtors in possession;

(2)   prepare and pursue confirmation of a plan and approval of a
disclosure statement;

(3)   prepare applications, motions, answers, orders, reports and
other legal papers;

(4)   appear in Court to protect the interests of the Debtors;

(5)   perform other legal services which may he necessary and
proper in the chapter 11  proceedings.

Subject to court approval, the Debtors will pay Young Conaway on
an hourly basis, plus reimbursement of actual necessary expenses.
The principal attorneys and paralegals presently designated to
represent Multicare and their current standard hourly rates,
which may be adjusted, are:

                   James L. Patton       $ 410
                   Robert S. Brady        $ 310
                   Maureen D. Luke       $ 270  
                   Dennis Mason           $ 100

The Debtors propose to employ Young Conaway under a general
retainer because of the extensive legal services that may he
required and the fact that the nature and extent of such services
are not known yet.

Young Conaway submits that the firm is a "disinterested person"
as that term is defined in section 101(14) of the Bankruptcy
Code. (Genesis/Multicare Bankruptcy News Issue 2; Bankruptcy
Creditors' Service Inc.)

GREAT TRAIN STORE: Rejection of Leases
The Great Train Store Company, Inc. and its debtor affiliates
reject the following leases:

Effective July 10, 2000
Woodland Hills Mall
7021 S. Memorial Drive, #118
Tulsa, OK

Effective July 8, 2000
Hamilton Place
2100 Hamilton Place Boulevard
Chattanooga, TN

Effective July 10, 2000
North Point Mall
1000 North Point Circle, #1030
Alpharetta, GA

Effective July 7, 2000
Tysons Corner Center
8045 Tysons Corner Center
McLean, VA

Effective July 13, 2000
Holyoke Mall at Ingleside
50 Holyokie Street, #B312
Holyoke, MA  

HARNISCHFEGER: Seeks To Select Agent To Sell Asia Pulp Note
The settlement of the Asia Pulp & Paper-related litigation closed
on April 6, 2000.  The Debtors received a $25,000,000 cash
payment and a $110,000,000 note issued by PT Indah Kiat Finance
(IV) Mauritius Limited and guaranteed by Asia Pulp & Paper
Company Ltd. and PT Indah Kait Pulp & Paper Tbk.  The Note is
payable in eight $13,750,000 quarterly installments, commencing
March 31, 2001, and 15% interest is payable semi-annually on
March 31 and September 30 of each year, commencing September 30,

The Debtors don't want to hold a note; they'd prefer to have

By this Motion, the Debtors ask the Court for permission to allow
the Debtors, in consultation with the Official Committee of
Unsecured Creditors and the Beloit Subcommittee, to select an
investment banker to sell the APP Note.  The Debtors, in turn,
will file an application for authority to employ the investment
banker pursuant to 11 U.S.C. Sec. 327(a).  The investment banker
will be charged with the selling the APP Note, in whole or in
part, on a competitive basis to achieve the highest overall
value.  The Debtors believe that if they were to market the APP
Note directly, they would not obtain the best price.  

Additionally, the Debtors ask Judge Walsh for explicit authority,
after the investment banker and the Debtors, with the consent of
the Official Committee of Unsecured Creditors and the Beloit
Subcommittee, select the offer or offers that yield the highest
overall value, to consummate the transactions without further
court approval.  The Debtors suggest that foreign entities
unfamiliar with the Bankruptcy Code are the likely buyers of the
APP Note.  The Debtors fear that the delays inherent in seeking
separate approval of the transactions would (i) deter potential
buyers from submitting offers for the APP Note or (ii) result in
a lower price. (Harnischfeger Bankruptcy News Issue 24;
Bankruptcy Creditors' Service Inc.)

HARVARD PILGRIM:  Medicare Program To End For 11,000 Seniors
HMO's across the country say, due to the low Medicare
reimbursements, they are losing millions of dollars.  Harvard
Pilgrim suffered losses of $25 million last year and expects
another $5 million to $7 million this year.   Together
with Harvard Pilgrim, Tufts Health Care announced the proposed
filing with the federal HCFA.  According to Geoff Wilkinson,
executive director of the MSAC, "The people don't count in the
business decisions these companies are making," and "They're
writing them off, like you write off bad debt." Harvard Pilgrim
will end its program with Worcester, Plymouth, Bristol and
Barnstable counties, but will retain providing for its 46,000
senior citizens in Suffolk, Middlesex, Norfolk and Essex

JENNA LANE: Files for Chapter 11 Reorganization
Jenna Lane, Inc. (NASDAQ:JLNY) announced on July 10, 2000 that in
response to an involuntary chapter 7 petition filed on June 30,
2000 against the Company it consented to the conversion of the
proceeding to one under Chapter 11 of the Bankruptcy Code.

The case is pending before Chief U.S. Bankruptcy Judge Stuart M.
Bernstein of the United States Bankruptcy Court for the Southern
District of New York, Case No. 00 B 41668 (SMB).  HSBC Business
Credit (USA) Inc., the Debtor's pre-petition factor, has agreed
to finance the Debtor's operations during the pendency of the
Chapter 11 case. The Debtor believes that continuing under the
protection of the bankruptcy court will enable it to maximize
assets and negotiate a plan with its creditors.

KENETECH: Annual Meeting Set For August 23, 2000
The annual meeting of stockholders of Kenetech Corporation, a
Delaware corporation, will be held at the Park Hyatt San
Francisco, 333 Battery Street, San Francisco, California, on
Wednesday, August 23, 2000, at 10:00 A.M., local time, for the
purpose of:

     1. Electing two Class I Directors of the company to hold
office for three-year terms;

     2. Considering and voting upon a proposal to amend the
Restated Certificate of Incorporation of the company to eliminate
the company's  Series U Preferred Stock;

     3. Considering and voting upon a proposal to amend the
Restated Certificate of Incorporation of the company to effect a
one-for-ten  reverse stock split of the issued and outstanding
shares of the company's  common stock, $0.0001 par value;

     4. Considering and voting upon a proposal to amend the
Restated Certificate of Incorporation of the company to decrease
the number of authorized shares of the ompany's common stock,
$0.0001 par value, from 110,000,000 to 11,000,000 and decrease
the number of authorized shares of the company's preferred stock,
par value $0.01, from 10,000,000 to 1,000,000;

     5. Ratifying the Board of Directors' appointment of
independent auditors to audit the financial statements of the
company for the 2000 fiscal year; and

     6. Acting upon all other matters which may properly come
before the meeting.

Stockholders of record at the close of business on June 26, 2000
are entitled to notice of, and to vote at, the meeting.

LOEWEN: Applicants' Third Motion For Extension of CCAA Stay
The Applicants are continuing to work diligently toward
presenting a Plan of Arrangement to their creditors and the Court
and continue to require the Court's protection, Derrick C. Tay,
Esq., of Mieghen Demers, told Mr. Justice Farley at a hearing
convened in Toronto convened for the purpose of considering a
third extension of the CCAA Stay through December 31, 2000.  

"The Company is very much aware of the fact it must, for the
benefit of all stakeholders, strive to complete the restructuring
process as quickly as possible," Bradley D. Stam, Loewen's Senior
Vice-President of Law and Asset Management, testified. "[We]
recognize[] that the protection afforded by the Insolvency
Proceedings is extraordinary and the Company appreciates the
confidence which stakeholders have shown to date. However, the
Company is also very much aware that the restructuring process
takes time, especially in these circumstances where the Company
is not only required to comply with the requirements of the
Insolvency Proceedings, but also is redesigning, for the benefit
of all stakeholders, the business of the Company to deal with the
challenges which have been presented.

"The Company strongly believes it must use its best efforts
through the restructuring process to remedy, or otherwise
address, the principal reasons why the restructuring was
necessary. Otherwise the Company may continue to suffer from its
historical problems and will not be in a position to maximize
recoveries for stakeholders." Mr. Stam indicated that, while
Loewen is anxious to close the insolvency-related chapter in its
corporate history, December 31, 2000, "is an aggressive target
for completion of the restructuring process."

Considering the Applicants' request, Mr. Justice Farley ruled
that the CCAA Stay shall be, and is, extended and continued to
December 31, 2000. (Loewen Bankruptcy News Issue 24; Bankruptcy
Creditors' Service Inc.)

MASTER GRAPHICS: Receives Court Approval of First-Day Orders
Master Graphics, Inc. (OTCBB: MAGR) announced it has received
Bankruptcy Court approval to, among other things, pay prepetition
and postpetition employee wages, salaries, commissions, workers
compensation, health benefits, and other employee obligations
during its voluntary restructuring under Chapter 11, which
commenced on July 7, 2000. The court also authorized the Company
to pay prepetition claims for consignment vendors and approved
procedures concerning consigned goods. The Company is also
authorized to continue certain prepetition customer rebate

In addition, the Court approved an agreement with the Companys
prepetition lenders, that provides liquidity to fund operations
and continue servicing customers in the ordinary course of
business. Discussions regarding debtor-in-possession financing
will continue in the interim.

The Court is scheduled to hear a motion the Company filed today
seeking approval of the implementation of a key employee
retention, incentive and severance program approved by the board
of directors. A hearing has been scheduled for August 3, 2000 to
hear pending motions.

Chief Executive Officer Michael Bemis said he was extremely
pleased by both the first-day orders entered by the Court, as
well as the support received at the first-day hearing by the
Companys noteholders and prepetition lenders. He noted that the
restructuring should have no impact on the day-to-day operations
of the Companys divisions or on its ability to serve its
customers. "There will be no interruption in operations at the
Companys divisions, and we will continue to purchase and pay for
goods and services from our suppliers." He also stated that
Master Graphics has already contacted a number of its major
vendors, who have indicated their support.

"With our first-day motions approved, we can now renew our focus
on the core operations of our business and concentrate on our key
constituencies -- our customers, our vendors and our employees.
We will continue our restructuring initiatives aimed at
increasing operating efficiencies, completion of our integration
and improving profitability. Concentrating on these areas will
enable Master Graphics to maximize the value of the business for
all of the Companys stakeholders," Mr. Bemis said.

In other actions, the Company filed papers to approve F. Duffield
"Duff" Meyercord, chief restructuring officer. Mr. Meyercord is
managing director of Carl Marks Consulting Group LLC, a New York
based firm that specializes in crisis management, turnarounds and
restructurings. Mr. Meyercord has extensive experience providing
advisory services to numerous public and private companies
in order to increase profitability and create stakeholder value
and includes many successes related to corporate restructurings.
The Company also filed papers for the appointment of J. Richard
Walker as interim chief financial officer, who is a senior
advisor of Carl Marks Consulting Group LLC.

Mr. Meyercord and his firm Carl Marks Consulting Group LLC have
been retained as consultants to assist the Company in evaluating
its strategic alternatives since June 5, 2000.

According to Michael Bemis, "Duff is the best person to help the
Company achieve its goals for creating a capital structure that
will support the operations of the business."

Master Graphics announced earlier today that it expects to reach
an agreement with the majority holders of the Companys 11 1/2%
Senior Notes due 2005 in the principal amount of $130 million to
convert substantially all of the bond debt into substantially all
of the future equity of the Company.

Master Graphics, Inc. and its wholly-owned subsidiary, Premier
Graphics, Inc. filed its Chapter 11 cases July 7, 2000 in the
U.S. Bankruptcy Court for the District of Delaware in Wilmington.

Master Graphics provides high-quality, general commercial
printing products to numerous customers throughout the United
States. The Cordova, Tennessee-based company employs
approximately 1,900 employees and operates 23 facilities in 14

NETWORK SYSTEMS: Announces Sale of Its Common Stock
Network Systems International, Inc. (NASDAQ: NESI), announced on
July 10, 2000 that it has entered into an agreement for the sale
of 1,666,667 newly issued shares of common stock at $0.60 per
share to seven investors in a private placement organized by
Millennium Holdings Group, Inc.

Network intends to use the proceeds from the sale of this stock
to reduce its outstanding indebtedness to Wachovia Bank, N.A. The
sale is expected to close in July.

During the past nine months, Network has experienced a
substantial reduction in revenues and has suffered large
operating losses. As a result of these two factors, Network is in
default of its financial loan covenants contained in its
revolving credit agreement with Wachovia. As stated in Network's
Quarterly Report on Form 10-QSB filed with the Securities and
Exchange Commission on May 15, 2000: "Until the Company can
renegotiate its current revolving credit agreement or secure
refinancing with another lender, the Company's principle
sources of liquidity are funds generated by operations. These
matters, along with the slowdown in software license sales, raise
doubt about the ability of the Company to continue as a going
concern." Network has been unable to arrange for adequate
financing to replace the Wachovia credit facility. After pursuing
a number of other alternatives, Network's Board of Directors
concluded that the sale of its stock to the Millennium investors
is the best alternative available at this time.

As a condition to the sale of stock, four of Network's current
management shareholders, Robbie M. Efird (the current Chairman of
the Board and Chief Executive Officer of Network), E.W. "Sonny"
Miller, Jr., David F. Christian and James W. Moseley, have agreed
to sell an aggregate of 2,700,000 of their shares of Network
stock to Herbert Tabin, a managing partner of Millennium, for
$ 1,500,000, or approximately $0.56 per share, in a second
private placement arranged by Millennium. The sale is also
conditioned upon all of the current directors of Network
resigning effective as of the closing date in favor of a
representative of the new investors. The current officers of
Network also plan to resign as of the closing date.

As a condition to completing the sale of the new shares to the
Millennium investors, Messrs. Efird, Miller, Christian and
Moseley will also grant Network an option, expiring in forty-five
days after the date of the stock sale, giving Network the right
to require the former management group to purchase all of the
operating assets of Network's business as currently conducted for
$3,000,000. During this 45-day period, Network will determine the
value of these assets and evaluate whether it is in the best
interests of Network and its shareholders for Network to sell the
assets to the former management group at the option price,
to sell the assets to a third party, to retain the assets or to
take other appropriate action.

If Network elects to exercise the option, the former management
group will make an initial cash payment of $1,500,000 for the
assets and will deliver a non-recourse promissory note in the
principal amount of $1,500,000, for the remaining purchase price.
The note will be secured by the former management group's
remaining 2,925,856 shares of Network stock. Millennium will use
its best efforts to place the pledged shares with accredited
investors on behalf of the former management group for at least
$1,500,000, or approximately $0.51 per share. Millennium will
remit the proceeds generated by the sale of the former management
group's remaining shares to Network to satisfy the remaining
balance of the purchase price for the assets. If the remaining
shares are sold for an amount greater than $1,500,000, Millennium
will retain the excess. Of the $ 3,000,000 paid for the assets,
it is intended that $2,000,000 will be used by Network to reduce
outstanding indebtedness to Wachovia under the revolving
credit arrangement. If Millennium cannot sell the remaining
shares for at least $1,500,000, Network will extinguish the
promissory note at maturity and retain the remaining shares in
satisfaction of the outstanding purchase price for the sale of
the assets.

Network Systems International, Inc. is a vertical market company
that specializes in providing industry specific solutions to the
textile, apparel, home furnishings and printing industries. The
Company's integrated applications provide customers a complete
system for managing the enterprise and supply chain. Founded in
1985, Network Systems International, Inc. is headquartered in
Greensboro, North Carolina with offices in Dallas, Texas and
Duncan, South Carolina.

PRANDIUM: Completes Sale of El Torito Division
Prandium, Inc. has completed the sale of its El Torito Restaurant
Division to Acapulco Acquisition Corp. of Long Beach, California.

Under the terms of the sale, Prandium received, subject to
certain post closing adjustments based on a closing balance
sheet, net cash proceeds of $114.7 million. Prandium expects to
record a pretax gain and positive earnings per share in the third
quarter of fiscal 2000 as a result of this transaction. A portion
of the net cash proceeds from the sale were used to repay certain
indebtedness. Additional alternative uses of the remaining
net cash proceeds are being explored by Prandium.

PRIMARY HEALTH: Joint Motion To Extend Co-Exclusive Periods
The Official Committee of Unsecured Creditors of Primary Health
Systems, Inc. and its debtor affiliates filed a joint motion for
order further extending the co-exclusive periods during which the
Official Committee of Unsecured Creditors and/or the debtors may
propose and file a plan of liquidation and solicit acceptances
thereof. The Committee and the debtors request that the court
enter an order extending the co-exclusive periods during which
the Committee or the debtors may file a plan of liquidation and
solicit acceptances thereof, through and including September 14,
2000 and November 13, 2000.

A hearing will be held on July 28, 2000 at 1:00 PM.

The joint motion seeks to extend the co-exclusive period for
filing a plan of liquidation to September 14, 2000 and the co-
exclusive period to solicit acceptances thereof to November 13,

Both the committee and the debtor are aware that these cases may
involve the filing of a liquidating plan.  The debtors are
currently seeking authorization to sell certain medical and other
equipment located at Mt. Sinai Medical Center- University Circle,
and are progressing toward the sale of the debtors' remaining
hospital facility - Deaconess Hospital.  In addition, the debtors
have recently successfully completed the sale of the St. Michael
Hospital, Mt. Sinai-East Hospital and the Integrated Medical
Campus facilities.

The committee and the debtors hope to develop and consummate a
consensual plan of liquidation, but require additional time to
analyze the possible results of the pending sales and any issues
which may present themselves relative thereto.

The debtors and the committee also require additional time to
analyze the debtors' unpaid administrative expense claims.  After
completion of the pending sales, the debtors may seek the court's
approval of r the establishment of an administrative claims bar
date in order to assist the debtor sand the committee to
understand the feasibility of proposing a liquidating plan.

RELIANCE LIFE: S&P Lowers Ratings to 'Bpi'
Standard & Poor's lowered its financial strength rating on
Reliance Life Insurance Co. (Reliance Life) to single-'Bpi'.

The rating action reflects the recent downgrade of the
counterparty credit rating on the company's parent, Reliance
Group Holdings Inc., to triple-'C' and the downgrade of the
financial strength rating on members of the Reliance Insurance
Co. Intercompany Pool to single-'B'.

Although the rating on Reliance Life is related to that of its
parent, the downgrade is mitigated by the benefits of Reliance
Life's regulatory shield, in accordance with Standard & Poor's
rating criteria.

Reliance Life is a life and health insurer licensed in 43 states,
the District of Columbia, and Canada, and writes credit life
insurance and credit accident and health coverage.

'pi' ratings, denoted with a 'pi' subscript, are insurer
financial strength ratings based on an analysis of an insurer's
published financial information and additional information in the
public domain. They do not reflect in-depth meetings with an
insurer's management and are therefore based on less
comprehensive information than ratings without a 'pi' subscript.
'pi' ratings are reviewed annually based on a new year's
financial statements, but may be reviewed on an interim basis if
a major event that may affect the insurer's financial security
occurs. Ratings with a 'pi' subscript are not subject to
potential CreditWatch listings.

Ratings with a 'pi' subscript generally are not modified with
'plus' or 'minus' designations. However, such designations may be
assigned when the insurer's financial strength rating is
constrained by sovereign risk or the credit quality of a parent
company or affiliated group, Standard & Poor's said.

ROBERDS: Motion For Authority To Sell Remaining Leases
Roberds, Inc., debtor, seeks an order authorizing the sale of
remaining real property leases and real property of the debtor by
auction or otherwise and setting a date to conduct an auction of
or otherwise sell the debtor's interest in real property leases
and real property of the debtor.

The debtor has determined that , in order to maximize the value
of its estate, it is in the best interests of the debtor and its
creditors to attempt to market and sell the leases and the real
property sites through an organized auction process utilizing the
services of DJM Asset Management, LLC, its real estate

The leases are as follows:
5300 Frontage Road, Forest Park, Georgia
975 Dawsonville Highway, Gainesville, Georgia
550 Franklin Road, Marietta, Georgia
6288 Dawson Blvd., Norcross, Georgia
2000 Holcombwoods Parkway, Roswell, Georgia

4741 East National Road, Indiana

1243 Ash Street, Piqua, Ohio
300 East Main Street, Springfield, Ohio
1100 East Central Avenue, West Carrollton, Ohio
1000 East Central Avenue, West Carrollton, Ohio
1100 East Central Avenue, West Carrollton, Ohio

Owned Real Property:
4465 Gandy Blvd. Tampa, Fla.
116 East Fletcher Avenue, North Tampa, Fla.
8905 US Highway 19 North, Port Richey, Fla.

4435 Atlanta Highway, Bogart, Georgia
5960 Stewart Parkway, Douglasville, Georgia
1302 Highway 85 North, Fayetteville, Georgia

2675 Fairfield Commons, Beavercreek, Ohio
6196 Poe Avenue, Vandalia, Ohio
2377 Commerce Drive, Fairborn, Ohio

SAFETY-KLEEN: Applies To Employ Shaw Pittman as Special Counsel
Safety-Kleen presents Judge Walsh with its application, pursuant
to 11 U.S.C. Sec. 327(e), to employ Shaw Pittman as special
counsel to represent the special committee of the board of

The Debtors advise Judge Walsh that, on March 6, 2000, Safety-
Kleen announced the initiation of an internal investigation of
certain alleged accounting irregularities in previously reported
financial results.  The Board immediately established a special
committee, consisting of four outside directors led by Mr. David
E. Thomas, Jr., to lead the investigation.  The special committee
promptly engaged the law firm of Shaw Pittman and the accounting
firm of Arthur Andersen LLP to conduct an independent
investigation of the alleged accounting irregularities and a
comprehensive review of the Debtors' financial reporting and
accounting practices and policies.  Pending the outcome of the
investigation, the board also placed SKC's Chief Executive
officer, Chief operating officer, and Chief Financial officer on
administrative leave. On May 12, 2000, these senior executives
resigned their positions.  

Shaw Pittman's proposed retention is for the purpose of
continuing its engagement to represent a Special Committee of the
Debtors' Board of Directors in conducting an investigation into
alleged financial reporting and accounting irregularities and to
provide representation on matters that relate to or arise from
the investigation.  The investigation is unrelated to the day-to-
day administration of these Chapter 11 cases.

Pursuant to an Engagement Letter dated as of March 4, 2000, Shaw
Pittman will assist the Special Committee in:

     (a) collecting and reviewing pertinent documents;

     (b) interviewing appropriate persons;

     (c) making findings and recommendations;

     (d) reporting such findings and recommendations to the
Special Committee and the board of directors of the Debtors;

     (e) retaining the services of Arthur Andersen LLP and such
other persons as Shaw Pittman regards as necessary to assist in
the investigation; and

     (f) counseling and advising the Special Committee on such
matters as Safety-Kleen requests.

Shaw Pittman's continued retention will be invaluable to the
Debtors as they seek to uncover the extent and nature of any
financial reporting and accounting irregularities with respect to
their past several fiscal years, Safety-Kleen says.

Shaw Pittman's customary hourly rates for attorneys range from
$135 per hour to $475 per hour and rates for legal assistants
range from $65 to $150 per hour.  The members and counsel
presently primarily expected to work on this matter, and their
hourly rates, are:

               Charles J. Landy           $375
               J. Thomas Lenhart          $375
               Philip J. Harvey           $350
               Alvin Dunn                 $275
               Marvin R. Lange            $325
               Gregory J. Phillips        $160

Shaw Pittman was paid a $285,000 retainer prior to the Petition

Charles J. Landy, a Shaw Pittman member based in Washington,
D.C., discloses that his Firm in the past has represented,
currently represents, and in the future likely will represent
certain creditors of the Debtors and other parties-in-interest in
matters unrelated to the Debtors, the Debtors' reorganization
cases or such entities, claims against or interests in the
Debtors.  Shaw Pittman's representation of any other entity will
not affect the firm's representation of the Debtors in these
cases, Mr. Landy says.  Mr. Landy stresses that Shaw Pittman does
not represent any other entities in any matter adverse or related
to the Debtors. (Safety-Kleen Bankruptcy News Issue 4; Bankruptcy
Creditors' Service Inc.)

Watson Pharmaceuticals, Inc. has reported that its tender offer
for shares of common stock of Schein Pharmaceutical, Inc., which
commenced on June 6, 2000, expired at 12:00 Midnight, New York
City time on Monday, July 3, 2000, and was not extended. During
the tender offer period, approximately 24,566,000 outstanding
Schein shares (representing approximately 74.4% of the total
outstanding Schein shares) were validly tendered and not

Watson Pharmaceuticals, Inc., headquartered in Corona, CA, is
engaged in the development, manufacture and sale of proprietary
and off-patent pharmaceutical products. Schein Pharmaceutical,
Inc., headquartered in Florham Park, NJ, is a pharmaceutical
company that has a diverse portfolio of both brand and generic

SILVER CINEMAS: Taps Haynes and Boothe LLP as Special Counsel
Silver Cinemas International, Inc., et al. seeks authority to
retain and employ Haynes and Boothe LLP as special counsel of the
debtors  for delivering opinions of counsel in connection with
financing, drafting, negotiating and general representation in
connection with real estate leasing and construction matters, and
general corporate advisory and representation matters.

The firm has agreed to be compensated on a time-spent basis,
based upon tis usual and customary hourly rates and fees as

Sue P. Murphy Partner $375/hour
Richard K. Martin Partner $350/hour
Steven L. Wilson Of Counsel $300/hour
Stephen M. Pezanosky Partner $300/hour
Craig S. Unterberg Associate $160/hour
Linda Breedlove Paralegal $110/hour

SOGO: Government Bail Out Proposed
Japan's prime minister, Yoshiro Mori, has ordered officials to
review a government bailout of Japanese department-store operator
Sogo that could cost taxpayers as much as 100 billion yen ($927
million), the Kyodo news agency reported.

TITAN ENERGY: Customer Accounts To Be Auctioned
About 50,000 customer accounts of Titan Energy, a natural gas
marketer that has filed for bankruptcy protection, will be sold
at an auction Wednesday in federal bankruptcy court.

Shell Energy, the No. 3 Georgia marketer, has bid $1.8 million
for the accounts, but other marketers will be able to bid under
an order Monday by U.S. Bankruptcy Judge W.H. Drake Jr.

Officials at Georgia Natural Gas Services, the state's largest
marketer, said they will not bid. A spokeswoman for SCANA Energy,
the second largest marketer, said a decision has not been made

Roswell-based Titan Energy of Georgia, the state's No. 6
marketer, was granted protection from creditors under Chapter 11
of the federal bankruptcy code last week. Its largest creditor is
Atlanta Gas Light Co., which distributes gas for the marketers.

Titan, which changed its name from United Gas Management this
year, is the second marketer to declare bankruptcy since
Georgia's natural gas market was deregulated last year.

Shell, which has bid $35 for each of Titan's customers, said it
is prepared to close the deal Wednesday and take on Titan's
customers Friday. The customers are free to choose another

TRI VALLEY GROWERS: To Facilitate Restructuring Thru Chapter 11
Tri Valley Growers, one of the nation's largest canned fruit and
tomato processors, announced on July 10, 2000 that, in order to
facilitate a restructuring of the company, it has filed a
voluntary petition for reorganization under Chapter 11 of the
Bankruptcy Code.

Concurrently, Tri Valley Growers announced it obtained a
commitment for approximately $270 million in debtor-in-possession
(DIP) financing from a group of financial institutions led by
Bank of America Business Credit to fund the company's operations
during its voluntary restructuring under Chapter 11. The
DIP financing, which is subject to Court approval, will provide
funds for post-petition supplier and employee obligations, as
well as the company's ongoing operating needs during the
restructuring process.

Tri Valley President and Chief Executive Officer Jeffrey P. Shaw
said that Tri Valley Growers' financial performance has been
impacted during the past two years by the effects of unfavorable
long-term contracts, industry wide oversupply of tomatoes and
plants running under capacity, which collectively stranded the
company's attempts to achieve profitability.  He noted that
despite the challenging conditions under which the company has
been operating, Tri Valley Growers has made tremendous progress
in many key areas during the past year.  "We reduced our short-
term debt by $60 million, cut inventory by $70 million and
significantly improved our levels of service.  Clearly, the
problems associated with the canned tomato market have hampered
our progress.  We are working hard at all levels of the
organization to facilitate the turnaround of Tri Valley Growers.

Tri Valley Growers produces or markets approximately half of the
nation's canned peaches and apricots.  The company also processes
and markets a sizable amount of the canned tomatoes.  Tri Valley
Growers' products are consumed in the U.S. and overseas.  They
are sold under branded and private labels to the retail grocery
and food service industries.

"We explored all the available alternatives, and we believe that
a voluntary Chapter 11 proceeding gives us the best opportunity
to rapidly reconfigure our operations, restructure our debt and
reposition our company for greater long term operational
efficiency, heightened sales success and strong profitability.
Today's action is critical to establishing a more appropriate
capital structure and a strong competitive future for Tri Valley

Tri Valley Growers said that while it completes its
restructuring, the company's food processing and canning
operations, warehousing, shipping and distribution system;
transportation network, consignment centers, equipment
leasing, and corporate offices would operate as usual.  Two
tomato facilities will be idled during this year's pack to
balance inventories in a difficult tomato industry.  The
company's employees will continue to be paid without
interruption, and it will continue to pay for all post-petition
purchases from growers and vendors utilizing the protection
provided by the Chapter 11 process.

The company filed its Chapter 11 petitions in the U.S. Bankruptcy
Court for the Northern District of California in Oakland.

TRI VALLEY GROWERS: Taps Investment Firm
Tri Valley Growers today announced the retention of Goldsmith-
Agio-Helms, a private investment banking firm, to help in the
restructuring of the company.

Tom Osetek, Tri Valley Growers' Group Vice President of Sales,
Marketing and Finance said, "Tri Valley is committed to exploring
all strategic alternatives that will maximize the value of the
business.  Goldsmith-Agio-Helms will pursue outside investments
in Tri Valley Growers' operations and potential buyers for the
company.  The Goldsmith-Agio-Helms investment banking team is an
important part of our company's reorganization and Chapter 11
bankruptcy restructuring process."

Tri Valley Growers filed a voluntary petition for reorganization
under Chapter 11 of the Bankruptcy Code today in Oakland.

Tri Valley Growers has a profitable canned fruit business with
strong retail and food service channels of distribution with
products are sold under numerous well-known branded and private
labels, including the popular S&W brand, which is owned by the
company.  Much of the Tri Valley Growers' current difficulties
have related to the tomato processing side of its business

Osetek said senior members of Goldsmith-Agio-Helms involved in
helping Tri Valley Growers secure investors or buyers include:
Kevin G. Jach, Managing Director; Barry D. Freeman, Director; and
Andrew R. Dowdle, Senior Associate. Interested parties may
contact Goldsmith-Agio-Helms at (612) 339-0500.

WAXMAN INDUSTRIES: Announces Financial Restructuring Agreement
Waxman Industries, Inc. (OTC Bulletin Board: WAXX), a holding
company for businesses supplying specialty plumbing and other
products to the U.S. repair and remodeling market, reported it
has reached agreements with, among others, a committee
representing its bondholders for the monetization of it ownership
of Barnett Inc. common stock and the financial restructuring of
Waxman Industries. These agreements include Waxman's agreement to
vote in favor of the acquisition of Barnett Inc. (Nasdaq: BNTT)
by Wilmar Industries Inc. for $13.15 per share, which was
announced today by Barnett.

The comprehensive financial restructuring plan includes the sale
of the 7.2 million common shares of Barnett Inc. owned by the
Company.  The sale proceeds will be used to pay certain
transaction related costs and reduce the Company's bank facility
by $9.9 million, to pay taxes, and to satisfy all of the $99.3
million of Waxman Industries' 12-3/4% Deferred Coupon Notes (the
"Deferred Coupon Notes") and $35.9 million of Waxman USA's 11-
1/8% Senior Notes (the "Senior Notes").  The agreement to sell
the Barnett shares is subject to certain conditions, including
regulatory and shareholder approval and certain financing
conditions, and is expected to close early in the fall of 2000.

The restructuring plan does not involve any of the Company's
operating subsidiaries, including Waxman Consumer Products Group,
Medal of Pennsylvania, Inc., WAMI  Sales Inc., or the operations
in Taiwan and China (TWI and CWI). The operating subsidiaries,
which have their own bank credit facility, will continue
to pay all of their trade creditors, employees and other
liabilities under normal trade conditions.

"We are pleased that the lengthy process to finalize the
agreements relating to the sale of Barnett and our financial
restructuring are complete, and look forward to the closing of
these transactions.  We are optimistic that these transaction
will translate into new business opportunities and confidence in
our future for our business partners and employees." said Armond
Waxman, President and Co-Chief Executive Officer.

The only creditors affected by this settlement are the Company's
Deferred Coupon Note holders.  After the sale of the Barnett
common stock is completed, Waxman Industries Inc. will file a
pre-negotiated plan of reorganization with the Bankruptcy Court,
that has been jointly developed and will be jointly sponsored by
the committee of Deferred Coupon Note holders (which represents
holders of approximately 87% of such notes), in order to more
effectively complete the transaction, and to cause the remaining
Deferred Coupon Note holders to accept the same discount as the
committee members.  The Company believes that the Joint Plan
should proceed quickly because it has the overwhelming support of
the Deferred Coupon Note holders, the only impaired class of
creditors.  The Company expects to complete the Plan by late --

WESTERN DIGITAL: Offers 4.1 Million Shares of Common Stock
Western Digital Corporation is offering 4,160,301 shares of its
common stock to an institutional investor. The common stock will
be purchased at a negotiated purchase price of $4.326610022 per
share. This price reflects the average of recent trading prices
of the company's common stock on the New York Stock Exchange, net
of a 4.25% discount. Western Digital will not pay any commissions
or other compensation in connection with this sale of common

The net proceeds to the company from this offering will be
$18,000,000 and the company plans to use the net proceeds for
general corporate purposes, including working capital.

Pending use of the net proceeds for any of these purposes, the
company may also invest in short-term investment grade
instruments, interest-bearing bank accounts, certificates of
deposit, money market securities, U.S. government securities or
mortgage-backed securities guaranteed by federal agencies.

As of May 27, 2000 before the issuance of the above cited shares
Western Digital had 139,364,874 shares of common stock


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

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

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