TCR_Public/000731.MBX T R O U B L E D   C O M P A N Y   R E P O R T E R

   Monday, July 31, 2000, Vol. 4, No. 148


AMERICA'S VOICE: Letter of Intent To Acquire Cable Channel
AMERISERVE: Equipment Division Sale Approved
AMERISERVE: DIP Financing Extended
CERPLEX, INC.:  Case Summary and 20 Largest Unsecured Creditors
CERPLEX INC: Files for Chapter 11 Bankruptcy

CERPLEX INC: Trouble Paying Its Bills
COMPLETE MANAGEMENT: To Sell Collection Rights
CONSECO: Announces Restructuring Program; Second Quarter Results
DEUTSCHE HYPOTHEKENBANK: Moody's Downgrades Ratings
DRKOOP.COM: Class Action Update

EATON'S: Former Employees Payout Moved To 6 Months
GLOBAL TISSUE: Case Summary and 20 Largest Unsecured Creditors
GORGES QUICK: Moody's Investors Service Downgrades Notes
GRAND UNION: Delisted From Nasdaq
HARNISCHFEGER: Beloit Taps Merrill Lynch To Sell APP Note

HARNISCHFEGER: Motion To Sell BWRC's Interests in Beloit Italy
INTEGRATED HEALTH: Announces New Management
KAUFMAN FOOTWEAR: Receivership Ends for Footwear
LEE COUNTY HOSPITAL: Files To Reorganize Under Chapter 11
LOGAN GENERAL: Lays Off 7% of Workers

MARINER: Oakwood To Lift Stay to Terminate Management Contracts
NORTHLAND CRANBERRIES: Renegotiated Loan Default Agreements
PLATINUM ENTERTAINMENT:  Case Summary and 20 Largest Creditors
TERRA INDUSTRIES:  Moody's Lowers Senior Notes From Caa1 to Caa2

VENCOR INC: Court Approves Extension of Exclusivity
WARNACO GROUP: May Possibly File For Bankruptcy Protection


AMERICA'S VOICE: Letter of Intent To Acquire Cable Channel
Two little-known companies have signed a letter of intent to
acquire bankrupt cable channel America's Voice.

The political-talk network plans to merge with Minneapolis-based
Wild Frontier Network Inc. and Deerfield Beach, Fla.-based
Carleigh Films Inc., according to a copy of the agreement filed
in bankruptcy court and obtained last week.

America's Voice also plans to convert its analog channel into
three or four digital channels, including one new service that
chief financial officer Rosemary Swanson said will be "something
that's along the Discovery Channel model."

The network will also look to lease space for digital channels to
start-up networks, and to offer both West Coast and East Coast
feeds for America's Voice, Swanson said.

But many issues remain unresolved, including how the sale will
affect a five-year deal America's Voice signed in March to allow
beleaguered 5th Avenue Channel Corp. to program 12 hours of its
schedule with its own programming. The US. Bankruptcy Court in
Washington, D.C., must also sign off on the deal.

Wild Frontier and Carleigh may spend up to $ 2 million in cash
for America's Voice, which counts 14 million subscribers,
including part-time subscribers.

Under the terms of the deal, Wild Frontier plans to acquire
Carleigh and simultaneously merge WFN/CFI into America's Voice.
WFN/CFI agreed to have $ 2 million in cash available at the
closing, and the combined company will commit $ 1.3 million of
the cash to pay off some of America's Voice creditors. The
network reportedly has $ 29 million in debt.

WFN/CFI also agreed to lend America's Voice between $ 200,000 and
$ 400,000.

America's Voice recently submitted the letter of intent to the
bankruptcy court. It plans to submit a reorganization plan to the
court within the next 10 days, David Mark, a bankruptcy attorney
at Roseman & Colin, which represents America's Voice, said last

America's Voice executives offered few details about the
backgrounds of their potential owners. Chairman Robert Sutton
said Carleigh chairman Irving Brand has "owned a lot of film
companies. He likes to take companies, put them together and make
a good business out of them."

America's Voice has struggled to gain cable carriage. Sutton said
the network counts 14 million subscribers, including part-time
carriage and over-the-air distribution.  He added that it only
has about 1 million cable subscribers on systems owned by AT&T
Broadband, MediaOne Group Inc. and Comcast Corp. Most of its
distribution comes from carriage on EchoStar Communications
Corp., C-band homes and PrimeStar, which is now owned by DirecTV

America's Voice has cut its staff from 90 employees to 52 since
the bankruptcy proceedings began, Sutton said.

AMERISERVE: Equipment Division Sale Approved
AmeriServe Food Distribution, Inc. announced that the United
States Bankruptcy Court in Wilmington, Del., has approved the
sale of AmeriServe's Equipment Division assets, subject to the
entry of a Sale Order by the Court, to North Texas Opportunity
Fund LP, for $26 million.  North Texas was the successful bidder
at the auction conducted by AmeriServe.  The approved sale is
scheduled to close on or before Aug. 15, 2000.  AmeriServe,
headquartered in Addison, Texas, a suburb of Dallas, is
one of the nation's largest distributors specializing in chain
restaurants, serving leading quick service systems such as KFC,
Long John Silver's, Pizza Hut and Taco Bell.

AMERISERVE: DIP Financing Extended
AmeriServe Food Distribution, Inc. and their DIP lenders have
agreed on an extension of the maturity date of the DIP financing
facility to and including September 28, 2000.  AmeriServe,
headquartered in Addison, Texas, a suburb of Dallas, is one of
the nation's largest distributors specializing in chain
restaurants, serving leading quick service systems
such as KFC, Long John Silver's, Pizza Hut and Taco Bell.

CERPLEX, INC.:  Case Summary and 20 Largest Unsecured Creditors
Debtor:  Cerplex, Inc.
          111 Pacifica Avenue, Suite 300
          Irvine, CA 92618-7428

Type of Business:  The debtor provides repair and logistics
services and parts sourcing and service management for
manufacturers of computer, communications and electronic office

Chapter 11 Petition Date:  July 27, 2000

Court:  District of Delaware

Bankruptcy Case No.:  00-03172

Judge:  Mary F. Welrath

Debtor's Counsel:  Norman L. Pernick
                    Saul, Ewing, Remick & Saul LLP
                    222 Delaware Avenue, P.O. Box 1266
                    Wilmington, DE 19899
                    Tel.: (302) 421-6824

Total Assets:  $ 10,490,461
Total Debts:   $ 40,594,892

20 Largest Unsecured Creditors

LG Electronics
201 James Record Road
Building #3
Huntsville, AL 35806
Tel.: (256) 772-4503
Fax : (256) 772-8987                 Trade         $ 459,643

Merrimack Valley Industrial
145 Rosemary Street-Entry E
Needham, MA 02194
Tel.: (781) 449-9000
Fax : (781) 449-9050                 Trade         $ 375,965

Purcell Staffing Inc.                Trade         $ 195,760

Video Display                        Trade         $ 146,290

Dell Financial Services              Trade         $ 107,887

Legacy Partners                      Trade          $ 86,881

Thunderbird Enterprises              Trade          $ 80,380

SysTech                              Trade          $ 78,122

Whittington Realty Partners          Trade          $ 77,704

Ingram Micro                         Trade          $ 74,528

Strategic Staffing                   Trade          $ 71,098

Priority Computer Parts              Trade          $ 69,491

Entegee/ATSI                         Trade          $ 62,552

Micro Product Distributors           Trade          $ 61,529

Innovative Computer & Networking     Trade          $ 56,514

Seacoast Electronics                 Trade          $ 54,370

Gates Arrow                          Trade          $ 52,244

North American Tech                  Trade          $ 43,789

Advanced Computer Services           Trade          $ 42,707

Micro Tech Consultants, Inc.         Trade          $ 40,357

CERPLEX INC: Files for Chapter 11 Bankruptcy
The Cerplex Group, Inc. (OTC Bulletin Board: CPLX) announced that
Cerplex, Inc., a wholly-owned subsidiary, has filed for Chapter
11 bankruptcy protection in the United States Bankruptcy Court
for the District of Delaware. This filing follows the previously
announced consent by The Cerplex Group, Inc., to an involuntary
bankruptcy petition filed against it on June 20, 2000 and
Cerplex's agreement to sell selected elements of its repair
business to Teleplan Holdings USA, a subsidiary of Teleplan
International, NV. (PRNewswire 7/27)

CERPLEX INC: Trouble Paying Its Bills
According to a report in the Los Angeles Times on July 28, 2000,
financially ailing Cerplex Group Inc. filed for bankruptcy
protection from its creditors to speed the sale of four units
after the Tustin provider of computer repair services failed to
make payments due on debt securities.

In documents filed Thursday in U.S. Bankruptcy Court in
Wilmington, Del., Cerplex listed $ 10.4 million in assets and
$ 40.5 million in debts.

Last week, the company said a U.S. unit of Dutch rival Teleplan
International NV would buy four Cerplex units in Kentucky,
Massachusetts and California.

Included in the sale would be the technical support call center
in Irvine. Cerplex would retain its headquarters, a business-to-
business online parts operation in Irvine and a repair facility
in Enfield, England.

As a condition of the transaction, Cerplex said, it voluntarily
filed a bankruptcy petition to reorganize debts under Chapter 11
of the federal bankruptcy code.

The filing was a response to an involuntary petition filed last
month by some holders of more than $ 10 million in certain
Cerplex debt securities. The company had failed to make a $ 2.2-
million payment due on the debt. Last week, the company said it
would consent to the involuntary petition.

Cerplex officials in May said the company was having trouble
paying its bills because of recurring operating losses.

Shares of parent company Cerplex Group Inc, which reported $ 93.3
million in 1999 sales, closed unchanged Thursday at 7 cents a
share in over-the-counter trading.

COMPLETE MANAGEMENT: To Sell Collection Rights
On August 9, 2000, at 9:30 a.m., in Courtroom 523 of the United
States Bankruptcy Court for the Southern District of New York,
before the Honorable Jeffry H. Gallet, United States Bankruptcy
Judge, Complete Management, Inc., a chapter 11 debtor in
possession ("CMI"), shall conduct an auction sale (the
"Sale Hearing") of its right, title and interest (the "Collection
Rights") in the collection of a portfolio of medical accounts
receivable (the "Receivables"), as more fully described in an
agreement, dated June 9, 2000 (the "Collection Agreement"), by
and among CMI and: (i) the Creditors' Committee in CMI's chapter
11 case (the "Committee"); (ii) Medical Receivables Corp.
("MRC"), a wholly-owned subsidiary of CMI that bought certain
Receivables and then pledged them as collateral for a loan; (iii)
Medical Management, Inc. ("MMI"), a wholly-owned subsidiary of
CMI that has operated magnetic resonance imaging facilities in
the New York City area; (iv) DVI Business Credit Corporation
("DVIBC"), which asserts a valid, duly-perfected first lien on
the Receivables, based on MRC's pledge of the Receivables as
collateral for DVIBC's loan; (v) Greater Metropolitan Neurology
Services, P.C., Complete Medical Services, P.C. and Objective
Medical Evaluation (collectively, "GMMS"), now-defunct medical
practices to which the majority of the Receivables are owed; and
(vi) HealthShield Capital Corporation ("HealthShield"), a 63.5%-
owned subsidiary of CMI which has proposed (in the Collection
Agreement) to undertake the collection of the Receivables, in
consideration of which HealthShield will receive certain
consideration, as defined in section 3 of the Collection

As additional consideration, and pursuant to a Reallocation
Agreement, HealthShield will also issue to CMI additional shares
of stock in HealthShield; CMI and its financial advisors have
estimated the value of this additional stock (the "HealthShield
Stock") at approximately $1,600,000. Please note that CMI does
not own the Receivables, but only a right to collect the

At the Sale Hearing, CMI will seek to sell its Collection Rights
in and to the Receivables to HealthShield in exchange for the
HealthShield Stock, subject to higher and better offers.  Copies
of (i) CMI's application to enter into the Collection Agreement
and Reallocation Agreement, (ii) its reply papers in further
support of its application (to which both the Collection
Agreement and Reallocation Agreement are annexed as exhibits), as
well as (iii) the July 21, 2000 order of the Bankruptcy Court,
authorizing CMI to put the Collection Rights up for auction at
the Sale Hearing, are available electronically by accessing the
Bankruptcy Court's website at

Potential bidders interested in making higher and better offers
for CMI's Collection Rights should contact CMI's financial
advisors, Loeb Partners Corporation, 61 Broadway, New York, New
York 10006, (212) 483-7086, attention: Harvey Tepner or Bruce
Kaufman, CMI's bankruptcy counsel, Salomon Green & Ostrow, P.C.,
485 Madison Avenue, New York, New York 10022, (212) 319-8500,
attention: Alec P. Ostrow, Esq., or Gary I. Selinger, Esq., in
advance of the August 9 hearing.

CONSECO: Announces Restructuring Program; Second Quarter Results
Gary C. Wendt, chairman and chief executive officer of Conseco,
Inc. (NYSE:CNC) announced a restructuring plan for the company's
Conseco Finance subsidiary as well as a program to sell or run
off several non-strategic assets. Separately, the company
reported second quarter results indicating that earnings from its
two primary business activities -- insurance and finance --
were essentially stable.


   -- Repayment of debt as due, particularly that scheduled for
the next 12 months.

   -- Restoration of credit ratings, particularly the A.M. Best
rating, which was decreased to B++ during the second quarter.

   -- Repositioning Conseco Finance so that it will be a cash
generator to, rather than a user from, the parent company.

   "To manage those three issues efficiently without diminishing
shareholder value, three of my former GE associates, Paul Street,
Mike Borom and Peter Keenoy, have joined our team of "restoration
activists." Their experience in managing similar situations while
working together at GE Capital is already being applied with
notable progress.


   Issue No. 1 -- Meeting our debt obligations.

   Several non-strategic assets have been identified and are
positioned to be sold or run off. They include:

   -- Assets acquired at the holding company through Conseco
Private Capital Group, including the Lawrenceburg riverboat and

   -- A sub-prime auto portfolio which has already resulted in
cash proceeds of approximately $150 million.

   -- Five units of Conseco Finance -- asset-based lending,
vendor finance, bankcards, transportation, and park construction,
will be sold or closed and run off.

   -- The bankcard portfolio has already been sold, resulting in
additional cash realized of $152 million.

   -- Additionally, enhanced utilization of assets held by
Conseco Finance can produce immediate cash benefits.

   -- Certain insurance lines which are not operating profitably
will, after some additional examination -- and unless they are
easily fixable -- be disposed of, thereby releasing capital.

   These actions have already generated cash sufficient to pre-
pay$300 million of principal due on Sept. 1, 2000. When fully
realized, these items should be sufficient to manage all
principal due this year and well into 2001.

The company intends to manage debt payments due from 2000 through
2002 while minimizing any change in our strategic position and/or
any loss to future income-generating potential. Management
believes this is a realizable goal. While reinsurance of existing
blocks of business can provide additional cash (if necessary, for
debt repayment), at this time, the company does not believe such
reinsurance will be necessary to manage current debt payment

   Issue No. 2 -- Restoring our ratings, particularly our "A-
level" A.M. Best rating for insurance activities.

To restore rating agency confidence in its insurance operations,
the company intends to demonstrate its ability to consistently
manage holding company debt obligations. Capital adequacy of the
combined insurance company is 2.54 times required capital (versus
the principal life companies of Equitable (2.37), John Hancock
(2.52) and Northwestern Mutual (2.37)). We can state that the
insurance company operations are very healthy and should require
only stabilization of the parent company's balance sheet to
restore the higher rating.

However, until the rating can be restored, the company will
actively pursue and implement "rented equity" (reinsurance) from
other insurance sources. These products are available in many
forms, and can be utilized in conjunction with Conseco products
so that the Conseco brand name will remain visible and
available to the public. The company believes that one form or
another of "rented equity" will be announced within the next 30

Issue No. 3: Conseco Finance.

"For the past several quarters, Conseco Finance has been
portrayed as the 'demon' in the Conseco house," Wendt said,
adding that several actions are being taken to remove this label:

-- The disposition of five business units.

-- Better utilization of existing assets so as to increase cash
available to the parent.

-- Restructuring cost cuts of approximately $155 million per
year, $137 million of which are associated with ongoing
businesses. The recurring cost savings comes from streamlining
the field force in manufactured housing finance (from 48 offices
to 33 offices) and home equity (from 158 offices to 127
offices). Conseco Finance management believes that this
streamlining of their organization can be done without
diminishing their market effectiveness.

-- Because of these moves, employment at CFC will decline by
approximately 2,000 over the next few months.

-- When completed, Conseco Finance will be operating under a new
business model, which will enable growth plus the ability to
upstream funds to the parent on an ongoing basis.

"My hat is off to the associates at Conseco Finance," Wendt said.
"They were aware of the issues confronting them when I arrived
and had already begun looking at various options that would solve
the problem. The combination of disposing of non-strategic
business units, streamlining the field force without
harming marketing capabilities and increasing the utilization of
non-core assets to pay corporate debt are excellent responses and
should allow them to enhance their business strengths and provide
positive support to the parent in the future."


-- Conseco Insurance pre-tax operating earnings were $154
million, up from $ 148 million in the first quarter of this year
and $110 million in the fourth quarter of 1999.

-- Conseco Finance reported marginally lower pre-tax operating
earnings than in the previous two quarters: $28 million versus
approximately $35 million. While 60+-day delinquency has risen,
it remains well within manageable levels and is not expected to
affect earlier predicted 2000 write-offs.

"Revenue and/or receivable generation also remained remarkably
good," Wendt said, "given the environment in which Conseco
associates have been working over the last two plus quarters."

-- Quarter-end managed receivables at Conseco Finance increased
by 2.1 percent (to $48.2 billion) over first quarter and up 5.3
percent over year-end 1999. On balance sheet receivables
increased by 15 percent over the first quarter and by 49 percent
over the end of 1999 as the business transitions itself from
"gain-on-sale accounting" to more traditional portfolio method

   -- Total collected premiums in the insurance and annuity
business were up 5 percent versus fourth quarter 1999, but down 1
percent versus 1Q00. Conseco's rating downgrade is affecting
premium production, however, thus far the impact has not been

"The changes adopted last year for Conseco Finance to move to
portfolio method accounting -- while clearly necessary -- make
usual comparisons in previous periods very difficult. However,
the recent change to the portfolio method will provide a much
better reflection of Conseco Finance's position in its
marketplace and allow for rapid earnings growth as the 'on-book
receivable' portfolio grows."


As expected, the holding company incurred significant special
items and charges during the second quarter. These items and
charges, which totaled $352.3 million after tax.

The total impact of holding company activities during the second
quarter including the charges summarized above, corporate
interest expense, minority interest, mark to market of the
company's investment in Tritel and other corporate income and
expense was $432.1 million after tax.

Consistent with the announcement regarding the Conseco Finance
restructuring, the company is reviewing all of its Finance
Company assets, which, management believes, will result in a
significant decrease in the capital investment in Conseco
Finance. Capital levels remain very strong in the insurance
operations. Corporate liquidity, excluding proceeds from recent
asset sales, remained stable with cash at the holding company of
approximately $460 million at June 30, 2000. The company is in
compliance with all debt covenants.

   "While perhaps appropriate for their time, the fluctuations in
GAAP earnings resulting from highly technical accounting issues
is something that the company must de-emphasize in the future,"
Wendt said. "Obviously some non-recurring, extraordinary items
will cause accounting effects while the restructuring process
takes place. We do not believe that these items will have
a significant balance sheet impact other than producing cash to
pay back debt."

Headquartered in Carmel, Ind., Conseco is one of middle America's
leading sources for insurance, investment and lending products.

DEUTSCHE HYPOTHEKENBANK: Moody's Downgrades Ratings
Moody's Investors Service has placed under review for possible
downgrade the C+ financial strength rating of Deutsche
Hypothekenbank Frankfurt-Hamburg AG (Deutsche Hyp). At the same
time, Moody's has confirmed the short- and long-term deposit and
debt ratings of Prime-1/Aa3 respectively. Moody's also confirmed
the Aaa/Aaa Public-Sector and Mortgage Pfandbrief ratings of
Deutsche Hyp.

The review of the mortgage bank's financial strength rating
follows the announcement that Deutsche Hyp will create an
additional gross loan loss provision of around Euro 200 million
during 2000, and that three board member have been suspended. The
loan loss provisions are primarily related to real estate
exposure in the Eastern Federal states dating back to a
period between 1995 and 1997 and follow the conclusion of a group
audit carried out in recent months by Deutsche Hyp's parent --
Dresdner Bank (rated Aa3/P-1/B with a negative outlook).

Moody's says that it views positively the creation of these
meaningful additional loan loss provisions. However, the review
will focus on the extent to which sufficient loan loss reserves
have been built-up in relation to the bank's significant East
German commercial real estate portfolio and also on the extent to
which Deutsche Hyp's financial flexibility, in part in the form
of operating reserves, is affected.

According to the rating agency , the confirmation of the Aa3
long-term deposit and debt ratings as well as the Aaa Pfandbrief
ratings reflect Moody's view that Deutsche Hyp is an integral
part of the Dresdner Bank group.

Deutsche Hypothekenbank Frankfurt-Hamburg AG is a German mortgage
bank, headquartered in Frankfurt, with consolidated assets of
Euro 92 billion as of December 31, 1999.

DRKOOP.COM: Class Action Update
On July 14, 2000, Finkelstein, Thompson & Loughran filed a
securities fraud class action lawsuit in the United States
District Court for the Western District of Texas on behalf of
investors who bought common stock of, Inc. (Nasdaq:
KOOP; "drkoop" or the "Company") between February 15, 2000 and
March 30, 2000, inclusive (the "Class Period").

The complaint alleges that the Company and certain of its
officers and directors, namely: Donald Hackett, Pres. & CEO; Dr.
C. Everett Koop, Chairman of the Board; Neal K. Longwill, Sr. VP
(Corporate Development); and Directors Nancy L. Snyderman and
John F. Zaccaro, violated the federal securities laws by making
materially false and misleading statements about the Company's
business and financial condition during the Class Period.
Specifically, on February 15, 2000, the Company's auditors signed
and delivered their opinion letter, which contained a "going
concern" qualification indicating that the auditors harbored
substantial doubt as to the Company's continuing viability. The
defendants concealed the going concern qualification and instead
made optimistic statements about the Company's earnings and

At the same time, the insider defendants were liquidating their
drkoop stock positions. Indeed, between February 18 and February
25, 2000, while in possession of the materially adverse non-
public information concerning the qualified auditor's opinion,
insiders sold more than 400,000 shares of drkoop stock, for
aggregate proceeds of more than $4.5 million.

It was not until March 30, 2000, when drkoop filed its Annual
Report on Securities and Exchange Commission ("SEC") Form 10-K,
that defendants disclosed for the first time the material fact
that its auditors doubted the Company's ability to continue as a
"going concern." Following these revelations, the Company's stock
plummeted from a previous close of $6.25 (which itself was down
from the Class Period high of $13 5/8) to a close of $3 11/16 on
March 31, 2000 -- a one day drop of approximately 41%.

Plaintiff seeks to recover damages on behalf of all investors who
purchased drkoop stock during the Class Period and who suffered
damages as a result, and is represented by the law firm of
Finkelstein, Thompson & Loughran, of Washington, DC, among
others. Finkelstein, Thompson & Loughran has over thirty years of
securities litigation experience, has broad experience in
representing defrauded investors in shareholder class actions,
and has been appointed to lead positions in many such actions in
federal and state courts throughout the United States.

If you are a member of the Class described above, and if you meet
certain other legal requirements, you may, not later than
September 12, 2000, move the Court to serve as a lead plaintiff.
If you wish to discuss this action or have any questions
concerning this notice or your rights or interests, please
contact Donald J. Enright with Finkelstein, Thompson & Loughran,
toll-free at 888-333-4409, or at 202-337-8000, or by e-mail at If you wish to learn more about Finkelstein,
Thompson & Loughran, you can visit the firm's Web page at (PRNewswire 7/27)

EATON'S: Former Employees Payout Moved To 6 Months
The Toronto Star reports on July 21, 2000 that department store
chain, T. Eaton Co. Ltd. will extend the date of its scheduled
payouts to its 13,000 former employees for another 6 months.  

According to Robert Harlang, acting liquidator of Montreal-based
Richter & Partners Inc., "We hope to have it substantially
completed before the end of the year, but realistically there are
a lot of claims that are in dispute."

The report cited more than $110 million in claims to former
employees who filed severance and termination claims and $52
million for long-term disability and health benefits for 10,000

GLOBAL TISSUE:  Case Summary and 20 Largest Unsecured Creditors
Debtor:  Global Tissue LLC
          400 Mahannah Avenue
          Memphis, TN 38107

Type of Business:  Manufacturer and Converter of paper napkins
any bathroom and facial tissues for private-label customers such
as supermarket chains and discount retailers

Chapter 11 Petition Date:  July 17, 2000

Court:  District of Delaware

Bankruptcy Case No.:  00-03104

Judge:  Peter J. Walsh

Debtor's Counsel:  Norman L. Pernick
                    Saul, Ewing, Remick & Saul LLP
                    222 Delaware Avenue, P.O. Box 1266
                    Wilmington, DE 19899
                    Tel.: (302) 421-6824

Total Assets:  $ 79,157,000
total Debts:   $ 93,095,000

20 Largest Unsecured Creditors

Ponderosa Fibres Of America
P.O. Box 1000 Dept. 410
Memphis, TN 38148-0410
Tel:(901) 525-0404
Fax:(901) 523-7637            Trade             $ 1,587,717

Treasurer, City Of Memphis
125 North Main, Room 375
Memphis, TN 38103-2080
Tel:(901) 522-1111
Fax:(9010 576-6304            Property Taxes    $ 1,030,953

Innovative Gas Services
101 East Second St. Ste 100
Owensboro, KY 42303
Tel:(270) 684-0459
Fax:(270) 684-8418            Utility             $ 994,394

Crystal Print, Inc.
500 Hart Court
Little Chute, WI 54140
Tel:(920) 739-9135
Fax:(920) 739-9130            Trade               $ 755,960

Bob Patterson, Trustee
Shelby County Trustee
P.O. Box 2751
Memphis, TN 38101-2751
Tel:(901) 521-1829
Fax:(901) 545-4880            Property Taxes      $ 749,156

Kieffer Pulp Mills, Inc.
1220 W. Spring St.
Brownstown, IN 47220
Tel:(812) 358-4150
Fax:(812) 358-4122            Trade               $ 708,381

International Florest Prod.
1 Boston Place, 35th Flr.
Boston, MA 02108
Tel:(617) 723-3455
Fax:(617) 723-3458            Trade               $ 501,451

CTS/Continental Traffic
Clark Tower 15th Flr.
5100 Poplar Avenue
Memphis, TN 38137
Tel:(901) 766-1500
Fax:(901) 766-1521            Trade               $ 432,355

Americraft Carton-Memphis
P.O. Box 87-6303
Kansas City, MO 6418-6303
Tel:(901) 725-5100
Fax:(901) 725-7115            Trade               $ 398,780

J & J South-Central
P.O. Box 102574
Atlanta, GA 30368-0574
Tel:(256) 859-5770
Fax:(256) 859-9755            Trade               $ 297,802

Jari International, Inc.
Box 5353 GPO
New York, NY 10087-5353
Tel:(416) 450-1057            Trade               $ 278,366

Hyster Credit Company
P.O. Box 78155
Phoenix, AZ 85062-8155
Tel:(800) 422-2738
Fax:(800) 832-0088            Lease               $ 254,894

Du Pont De Nemours &
Co., Inc.                     Trade               $ 233,292

Kruger, Inc.                  Intercompany
                               Advances            $ 223,573

Industries James Maclaren     Trade               $ 222,547

City Treasurer, Environ Engr  Utility             $ 209,954

Scott Paper Limited           Trade               $ 205,867

GL & V/Black Clawson-Ken      Trade               $ 205,315

Voith Fabrics                 Trade               $ 204,500

Marathon Pulp, Inc.           Trade               $ 195,533

GORGES QUICK: Moody's Investors Service Downgrades Notes
Moody's Investors Service downgraded the $52 million 11.5% senior
subordinated notes, due 2006, of Gorges/Quik-to-Fix Foods, Inc.
("Gorges") to Caa3 from Caa1. The senior implied rating has been
lowered to Caa1 from B2, and the senior unsecured issuer rating
has been lowered to Caa2 from B3. The company's new senior
secured credit facilities are not rated. The ratings outlook is
stable, recognizing recent liquidity support backed by
its major shareholder.

The downgrade reflects Gorges' ongoing weak volume trends in
1999/2000, which have reduced revenues and pressured financial
flexibility due to the company's high operating and financial
leverage. The volume declines stem from the company's October
1998 strategic decision to no longer manufacture lower margin
ground beef products, as well as an ongoing loss in sales
volumes of value-added products to national accounts. Resulting
weak credit measures have caused the company to repeatedly
violate bank facility covenants. Gorges, however, has
successfully negotiated covenant waivers to date, and the company
has received financial support from CGW Southeast Partners III,
L.P., a 74% shareholder. In addition, Gorges is engaged in
turnaround initiatives with a new management team, which include
consolidating production from three into two facilities by
relocating and upgrading production lines and mothballing a
plant, to enhance efficiency and reduce fixed costs. Yet, the
company's selling, general and administrative infrastructure
would be difficult to cut without potential impact on sales
volumes, and Moody's remains concerned that the company's high
operating and financial leverage, its almost sole product
concentration on beef, and the highly competitive market sector
landscape are likely to present ongoing challenges to Gorges.

Gorges/Quick-to-Fix Foods, Inc. based in Garland, Texas, is a
producer and marketer of processed beef products used in the
foodservice sector.

GRAND UNION: Delisted From Nasdaq
According to a report in The Record (Bergen County, NJ) on July
27, 2000, with its stock price down to 25 cents a share, Grand
Union Co. announced after the market closed  Wednesday that its
common stock was being delisted from the Nasdaq National Market,
effective immediately, and that the stock was not  eligible for
listing on Nasdaq's Small Cap Market.

Last month, the company announced that it would appeal the
action,  but with its stock at the current level, it decided an
appeal would be a  waste of time and money, a 1 person familiar
with the decision said.

The stock, which closed Wednesday down 9 3/8 cents in active
trading, will still be publicly traded but will be relegated to
the less prestigious OTC Bulletin Board.

Grand Union announced in May that it was being dropped from the
national listing after two years because the stock was trading
under $ 5 a share, the Nasdaq minimum.

Grand Union applied for inclusion on the Nasdaq Small Cap Market,
but the stock fell below that market's $ 1-a-share minimum, and
the application was not accepted.

The big drop in stock price has also reduced Grand Union's value,
with the market capitalization of what its top executive
described as a $2 billion company plummeting to $ 7.5 million.
That's a fraction of its  $330 million market capitalization
eight months ago.

Though unable to do much about the stock price and where it is
traded, company officials have been attempting to boost margins
through a new advertising campaign and emphasis on perishables,
said Gary Philbin, the president and chief executive.

Redesigned weekly circulars, which were introduced this month,
are "the most visible piece of what our customer research has
shown us, how customers shop today,"Philbin said.

"The new format makes it much more readable; it's more logically
laid out,"he said."It reflects much more on the perishable side,
which customers are saying is very important to them."

Perishables have been a focus as well in the limited number of
store makeovers and new-store construction the company has
completed in  recent months, he said."We're now focusing on our
core base of stores  ... to get customers to buy a little more in
those areas,"he said.

In the long term, Grand Union is exploring"various strategic
alternatives to improve its financial performance, which may
include  asset sales, store closings or a sale of the company,"
according to the  10K filing, the annual financial report, made
with the Securities and  Exchange Commission on June 30.

It has retained Merrill Lynch & Co."to provide investment banking  
advice"and Alvarez & Marsal Inc., a distressed-business
consulting  company, "to assist in the development of a strategic
business plan,"  the report said.

Grand Union announced Nasdaq's decision to delist it 1 May 16,
the  same day the company reported a 21 percent drop in sales,
which led to a  loss of $ 201 million in its fourth fiscal

The company appealed the delisting June 23, just before it was to
take effect. While waiting for the final determination, Grand
Union has remained on Nasdaq's National Market.

Grand Union first appeared on the Nasdaq National Market on Oct.
1, 1998, shortly after emerging from Chapter 11 bankruptcy
protection. Its stock opened at $ 8 a share, rose to nearly $ 14
in less than three months, and remained mostly in the $ 10 to $
14 range until January.

It has been all downhill since, sparked initially by a Feb. 22
earnings report that the company lost $ 35.6 million in the third
quarter, $ 9 million more than a year earlier. The stock closed
under $ 1 for the first time May 15, and, following a small
rally, has been stuck  under $ 1 since June 12.

The company's first financial quarter ended Saturday. Earnings
are expected to be announced around the time of its annual
meeting Aug. 17.

HARNISCHFEGER: Beloit Taps Merrill Lynch To Sell APP Note
Beloit Corporation seeks the court's authority to employ and
retain Merrill Lynch, Pierce, Fenner & Smith, Incorporated as
Placement Agent to sell the Asia Pulp & Paper Promissory Note, in
the aggregate principal face amount of $110,000,000 issued by PT
Indah Kiat Finance (IV) Mauritius Limited under certain indenture
between Indah Kiat Finance (IV) Mauritius Limited, as Issuer,
Asia Pulp & Paper Company Ltd. and PT Indah Kiat Pulp & Paper
Tbk, as Guarantors, and The Bank of ew York, as Trustee, dated
March 31, 2000.

Pursuant to the Merrill Lynch Agreement, Merrill Lynch will act
as agent, but not principal, in the secondary placement of the
APP Note on a best efforts basis.

Beloit asserts that the proposed services by Merrill Lynch are
necessary to enable Beloit to maximize the value of its estates
and to reorganize successfully because the sale of the APP Note
will bring a substantial sum of cash, and given the complexities
of APP and the sale of notes of an Indonesian company, Beloit
believes taht the best price will be achieved by using an
experienced placement agent to sell the APP Note.

The Debtors believe that Merrill Lynch is well-qualified to
provide the services to Beloit in a cost-effective, efficient and
timely manner.

Pursuant to the Agreement, Beloit has agreed to pay Merrill Lynch
1.125% of the principal amount of the APP Note, and to reimburse
Merrill Lynch for reasonable legal expenses.

Beloit also seeks authority to pay Merrill Lynch its fees and
expenses, pursuant to section 328 of the Bankruptcy Code, without
the need to comply with the Court's order governing the
reimbursement of fees and expenses for professionals and the
Committee in HII cases.

Beloit represents that the compensation arrangement provided for
in the Merrill Lynch Agreement is consistent with customary
practice. Beloit also represents that Merrill Lynch is a
disinterested person as the term is defined in section
101(14) of the Bankruptcy Code, as modified by section 1107(b) of
the Bankruptcy Code.

The United States Trustee objects to excusing Merrill Lynch from
complying with the Court Order governing the reimbursement of
expenses for professionals and committee members. UST says that
compliance with the order is not unduly burdensome given that
Merrill Lynch will have to compile summary of its expenses in
order to ascertain the amount of any reimbursement.
(Harnischfeger Bankruptcy News Issue 25; Bankruptcy Creditors'
Service Inc.)

HARNISCHFEGER: Motion To Sell BWRC's Interests in Beloit Italy
Beloit Italy, 99.98% owned by Debtor BWRC, is engaged in the
manufacture, sales, service, and supply of pulping equipment and
paper-making machinery.

Beloit and BWRC tell the Court that Beloit Italy is in a
precarious financial situation and it is sound business judgment
to sell the company. If not sold, Beloit Italy will have to be
liquidated through Italian insolvency proceedings.
Should this occur, the Debtors would receive little, if anything,
on account of Intercompany Receivables and an Italian liquidator
would press to collect on Beloit Italy's Intercompany
Receivables. In addition, under Italian insolvency laws, the
moving Debtors and ultimately HII might be exposed to claims of
Beloit Italy's creditors including claims for considerable
employee severance payments.

An international search produced two prospective purchasers.
Beloit has determined that the offer by Romano Nugo is the
highest and best offer for Beloit Italia's shares.

Accordingly, the Debtors ask the Court to authorize BWRC to sell
its shares of Beloit Italia S.p.a. pursuant to a Shares Sale
Agreement between BWRC and Romano Nugo S.p.A., a corporation
orgainized under the laws of Italy, or, to sell to a party that
makes a bona fide overbid at least two days prior to the Court's
hearing on this Motion, and to authorize Beloit to waive certain
intercompany claims and take other actions to effectuate the

Under the Shares Sale Agreement, the Buyer will:

(a)  pay BWRC $50,000 as consideration for the purchase;

(b)  cause Beloit Italy to assign to BWRC certain Beloit Italy
Intercompany Receivables as agreed, in the aggregate amount of
$6,238,844 estimated as of April 30, 2000;

(c) pay BWRC an amount of $1,600,000;

(d) use its best efforts to keep Beloit Italy in good
operational, financial and cash condition so that it remains
solvent for three years after the Closing;

(e) provide BWRC with a three-year personal guaranty of Mr.
Romano Nugo, the principal of the Buyer, for obligations of the
Buyer arising under the Agreement, initially in the amount of
$3,000,000 gradually diminishing to $2,000,000 for the second
year, and to $1,000,000 for the third year;

(f) manage Beloit Italy in a prudent way and fund its Interim
Costs for operation from the date of the execution of the
Agreement through the Closing (the Management Period);

(g) cease using the company name Beloit or any name or trade mark
of HII and the Harnischfeger Group, as well as any other
intellectual property of the Harnischfeger Group that had been
used by Beloit Italy upon the expiry of the IP License on October
31, except for Technology of the Site, which according to the
Agreement refers to "information in non-tangible form that,
without the intent to use the Harnischfeger Group's or a third
party's intellectual property for a purpose not permitted by the
Agreement, ... is retained in the memories of those persons who
have had authorized access to such intellectual property or
industrial property."

BWRC agrees to:

(a) cause Beloit to pay or relieve the Buyer of the liability for
certain specified Beloit Italy Intercompany Payables in the
aggregate amount of $8,625,823 estimated as of April 30, 2000;

(b) cause Harnischfeger ULC, a solvent non-debtor entity that has
continued to repay its obligations to Beloit Italy, to repay
Beloit Italy the balance of the intercompany loan that is due and
owing to Beloit Italy in the principal amount of $2,545,284, plus
$253,418 of accrued interest;

(c) stop actively soliciting an Alternative Offer after the
execution of the Agreement, and in the event BWRC accepts an
Alternative Offer, to remimburse all of the Interim Costs to the

The Buyer is purchasing the shares of Beloit Italy without any
representations or warranties, except as to title, and the
parties also agree that, if the transactions contemplated in the
Agreement do not take place by August 31, 2000, the Agreement
will become null and void.

Beloit and BWRC represent that the consideration to BWRC proposed
under the Agreement is fair and reasonable, the Agreement is the
product of good faith, arm's-length negotiations between Beloit
and the Buyer.

Beloit and BWRC also tell the Court that the proposed sale of the
shares of Beloit Italy is "under a plan" within the meaning of
section 1146 of the Bankruptcy Code. The consideration to be paid
under the Agreement will be required to fund administrative and
other claims under such plan. Consummation of the sale is
essential to the preparation and consummation of a liquidating
plan for the Moving Debtors. Therefore, the sale of BWRC's shares
of Beloit Italy should be exempt from the imposition of any stamp
or similar tax.

Accordingly, Beloit and BWRC sought and obtained the Court's
authority for:

(a)  BWRC to sell its shares in Beboit Italy pursuant to the
Agreement free and clear of transfer taxes;

(b)  Beloit (on behalf of itself and its non-debtor affiliates)
to release certain claims against Beloit Italy;

(c)  BWRC to sell the shares or assets of Beloit Italy to another
third party who, at least two days prior to the hearing on the
Motion, submits an Alternative Offer for such shares or assets
that, in Beboit's business judgment, is a higher and better offer
than that reflected in the Agreement;

(d)  the Moving Debtors to take all actions necessary to
effectuate the closing of the Agreement. (Harnischfeger
Bankruptcy News Issue 25; Bankruptcy Creditors' Service Inc.)

INTEGRATED HEALTH: Announces New Management
Integrated Health Services, Inc. (OTC Bulletin Board: IHSVQ)
announced that Joseph A. Bondi of the turnaround consulting firm
of Alvarez & Marsal, Inc., has been named as the Chief
Restructuring Officer of the Company. In connection with this
appointment, Robert N. Elkins, a founder of IHS, has agreed to
step down as Chairman, CEO and President upon approval by the
U.S. Bankruptcy Court for the District of Delaware of an
agreement between Dr. Elkins and IHS. At such time, Mr. Bondi
will be named as CEO.

Mr. Bondi and Alvarez & Marsal, Inc. have extensive experience in
the field of restructuring and reorganization. Mr. Bondi's prior
experience includes serving as Chairman-Restructuring of
MobilMedia, Inc., Chief Restructuring Officer of Iridium LLC and
Senior Vice President of Republic Health Corporation.
"Joe Bondi, the creditors and IHS realize that their first
commitment is to the continued maintenance of high quality
patient care," said Robert N. Elkins, Chairman and Chief
Executive Officer. "We all remain dedicated to this as our main

Integrated Health Services is a highly diversified health
services provider, offering a broad spectrum of post-acute
medical and rehabilitative services through its nationwide
healthcare network. IHS's post-acute services include home
respiratory services, subacute care, long term care and contract
rehabilitation services.

KAUFMAN FOOTWEAR: Receivership Ends for Footwear
The London Free Press reports on July 24, 2000 that  Ernst &
Young Inc. was appointed receiver and manager of the 93-year-old
bootmaker, Kaufman Footwear, ending the receivership of Kaufman's

SVP of Ernst & Young, Bill Goss says, he is very much confident
that he can find a buyer for the 700 employee bankrupt bootmaker
situated in Kitchener, Ontario.  "That's the absolute goal,"
[and] "The business has been here for 100 years, Goss added.  It
has been at this corner forever, for God's sake, and it should
stay here."  He also said that he will contact the only company
that offered to buy Kaufman, Red Wing Shoe Co. which is based in
Minnesota. According to the report, Red Wing's public relations
manager, Cindy Taube, said it was too soon to make another offer.

LEE COUNTY HOSPITAL: Files To Reorganize Under Chapter 11
Lee County Community Hospital has filed to reorganize its
finances under Chapter 11 federal bankruptcy protection.

The filing Wednesday said the 70-year-old hospital is $5.2
million in debt. The reorganization is expected to eliminate the
80-bed facility's obstetrics services and cost about 30 jobs.

The filing came less than three weeks after the hospital's former
administrator, James Luther Davis, pleaded guilty to racketeering
and conspiracy charges. Federal prosecutors said he and others
were part of an equipment-leasing scheme that netted about $7.4

Hospital officials have 120 days to submit a financial
reorganization plan.

Last year, the hospital delivered 125 babies - an insufficient
number to support keeping the obstetrics unit open and requiring
an annual subsidy of $ 365,000, said acting administrator G.K.U.

The hospital currently has about 270 employees. The goal is to
reduce that number to about 240, Kumar said.

LOGAN GENERAL: Lays Off 7% of Workers
Logan General Hospital laid off 7 percent of its staff Wednesday,
and demoted, transferred or cut the pay of another 9 percent
because of a $ 4 million budget shortfall, hospital officials

Some nurses and management, but not doctors, are included in the
shakeup at the Logan County hospital as it continues its efforts
to emerge from bankruptcy.

"Our emphasis in the cost reduction plan is to maintain quality
care and ensure minimal impact in nursing and clinical areas,"
hospital chief Tom Senker said. "This is a difficult process that
will affect many people."

All told, 49 of the hospital's 692 full-time workers lost their
jobs permanently, while another 64 will be reassigned or demoted
or lose pay, officials said.

Senker said the decision did not involve Genesis Affiliated
Health Systems. Logan General has agreed to join the alliance of
regional hospitals as part of its plan to emerge from Chapter 11.

Though signed, the Genesis agreement does not take effect until
after the bankruptcy is resolved, Senker said. Under the
agreement, Logan General will hand over some authority to the
Genesis board of directors. That board will include a Logan
General contingent.

The reorganization plan also outlines a five-year financial
projection for the 132-bed, non-profit hospital. Though the
hospital's expenses as of June 30 fell below that projection by $
760,000, its revenues failed to meet the projection by $ 4
million, Senker said.

"This serious fiscal situation must be addressed immediately not
only to meet our financial requirements, but more importantly to
ensure the viability of Logan General Hospital as a not-for-
profit, community hospital," Senker said.

The hospital has grossed $ 64.3 million in patient revenues this
year as of June, while it had grossed $ 71.7 million by this time
last year, its latest financial filings said. The hospital had
hoped to have grossed $ 70.1 million by this time.

The hospital once generated more patient revenues per bed than
any hospital in the state. It also employed more than 800 people
when it sought bankruptcy protection in October 1998.

Chronic cash-flow problems prompted the bankruptcy filing, as did
a creditor's request to oust longtime Logan General President C.
David Morrison. The creditor's concern and the poor cash flow
both traced back to Morrison's decision to build a Logan-area
mall with more than $ 20 million in hospital funds.

Though doctors are not among those laid off or otherwise
affected, several may retire or seek jobs elsewhere to help the
hospital cut costs, spokeswoman Ronna McClure said. McClure said
she was not aware of any hospital departments shutting down
entirely because of the staff shakeup.

The financially-strapped Logan General Hospital has a new leader.

The hospital board of directors has named Thomas Sphatt of
Cleveland as chief executive officer.  Sphatt will assume full-
time leadership Aug. 14.

He replaces interim CEO Tom Senker, who has been leading the
hospital through bankruptcy proceedings the past several months.

Sphatt has more than 20 years of senior management experience in
community hospitals, academic medical centers and health care
systems. Since 1998, he has worked with financially troubled
hospitals for Quorum Health Resources.

He said he is familiar with Logan General's problems and feels
confident the situation can be turned around.

The hospital made its latest budget cuts earlier this week,
laying off 49 workers and announcing plans to make position or
pay changes to 64 other employees.

Hospital officials said the reductions are necessary because of a
projected $ 4 million deficit for the first half of this year.
The hospital filed for bankruptcy in October 1998.

Former CEO C. David Morrison is to stand trial later this year in
federal court on embezzlement charges.

MARINER: Oakwood Seeks To Lift Stay to Terminate Management
Oakwood Living Centers of Massachusetts, Inc., and Oakwood Living
Centers of Virginia, Inc. move the Court for an order to compel
MPAN to turn over all records regarding Oakwood's facilities.

Oakwood complains that Mariner is not acting according to the
agreement reached during Oakwood's relief from the automatic stay
granted by the Court to deal with pre-petition contract disputes
over Mariner's management of the seven Oakwood facilities.

Oakwood asserts that the Term Sheet provides that Mariner would

   (a) take certain steps to improve its clinical support and
personnel functions to insure patient care at the facilities;

   (b) cooperate with Oakwood's attempts to refinance its
mortgage obligations;

   (c) provide outstanding financial reports; and the parties

   (d) would reconcile an asserted trade payable of Oakwood to an
entity known as Prism Rehab.

However, Oakwood alleges that

(1) Patient Care Issues Remain Unresolved

Oakwood representatives have received calls from facility
employees and management and patient families highlighting
deficiencies in patient care. In addition, Mariner has also
threatened to remove its administrators from the facilities on
short notice, demonstrating little concern for the well being of
the patients. Mariner also continues to utilize personnel in
these facilities with qualifications which are unsatisfactory to
Oakwood. +

(2) Mariner Did Not Cooperate With The HUD Refinancing Efforts

Despite knowledge of Oakwood's then pending HUD financing and the   
importance of Mariner's production of financial records to close
the loans, none of the requested information was supplied and the
HUD financing has been denied, resulting in the losss of in
excess of $484,000 in commitment fees and nonrefundable deposits.

(3) Mariner Continues To Fail To Provide Financial Information
Oakwood accuses Mariner of holding financial information hostage
in an effect to gain leverage over Oakwood in their financial
dealings. In some cases Mariner has failed to provide financial
information in a form usable by Oakwood and, in other cases,
failed to provide any financial information at all.

As a result, Oakwood Massachusetts's Cape Heritage Facility was
notified by the Health Care Financing Administration that HCFA
must find that Cape Heritage had been overpaid approximately
$750,000 and that absent repayment of these amounts, HCFA will
withhold future payments to this facility until it has offset
this $750,000.

In addition, Oakwood Virginia has been unable to supply the
Commonwealth of Virginia with a final 1999 audit due to Mariner's
unwillingness or inability to provide (a) Oakwood's accountants
with the requested information or (b) audited financials of its
own. Oakwood is concerned that Oakwood Virginia will be penalized
10% of all future reimbursement requests until that audit is
completed. This could cost Oakwood hundreds of thousands of

(4) Mariner Has Not Cooperated In The True-Up Process
The Term Sheet provides for a reconciliation process which
contemplated the free exchange of information between the
parties. However, Oakwood did not receive Mariner's initial
attempt to true up the asserted Prism Rehab obligation until May
18, 2000, and Mariner's "reconciliation" consisted solely of
providing Oakwood with the gross number that had previously been
asserted by Mariner to be due with no backup documentation.

In order to avoid further problems in attempts to refinance
Oakwood's mortgage obligation and obtain cost reimbursements,
Oakwood wants all books and records regarding the facilities be
turned over to it. Oakwood asserts that the books and records of
the facilities are the property of Oakwood, the information is
critical to Oakwood's ability to process its cost reports and
evaluate the management of its facilities, and Mariner should not
be permitted to hold hostage information regarding the management
of Oakwood's facilities and utilize it as "leverage" over Oakwood
in their business dealings.

Mariner Responds and Alleges Outstanding Management Fees

In response, Mariner accuses Oakwood of failing to pay management
fees under the Term Sheet which says that Oakwood will manage or
arrange for the management of the financial services and Mariner
will continue to provide clinical services required under the
Management Agreement through June 30, 2000 and the two parties
will share 50%-50% the management fees payable under the
Management Agreement for the period February 1, 2000 through June
30, 2000. Mariner asserts that the total amount due is $399,778.
Mariner also alleges that Oakwood has failed and refused to pay
reasonable expenses owed to Mariner, which includes salaries for
the facilities' administrators.

Mariner points out that Oakwood has no right to withhold
management fees or to refuse to enter into a new promissory note
for amounts owed to Mariner for rehabilitation services provided
to the Oakwood facilities.

Mariner argues that it has complied with the Term Sheet, any
deficiencies alleged by Oakwood are either not provided, not
true, or both, and even if the allegations stand, the sole remedy
provided to Oakwood is the right to terminate the Management
Agreements as of June 30, 2000.

With respect to financial reporting, Mariner points out that
compliance will give Mariner an opportunity under the Term Sheet
to resume financial management of the Oakwood facilities as of
July 1, 2000.

Mariner tells the Court it has provided all financial reports due
under the Management Agreements for Oakwood's fiscal year which
ended on December 31, 1999.

With regard to the HUD refinancing efforts, Mariner argues that
it has no obligation under the Term Sheet to provide specific
information to Oakwood in any predetermined format, but only to
cooperate in "good faith", which it has done.

About reconciliation process, Mariner tells the cout that on May
12, 2000, seven weeks before the deadline for the parties to
reconcile the amounts due to Mariner by Oakwood for
rehabilitation services, provided Oakwood with financial
information regarding the amount Mariner contends it is owed.
Mariner points out that Oakwood had not requested for the `title
up" process to begin prior to that. Supporting documents, Mariner
says, are maintained at the various Oakwood facilities and
accessible by Oakwood. Fighting back, Mariner accuses Oakwood of
failing to participate in the "true up" process since receiving
Mariner's information on May 12, 2000, and has provided no
documentation to indicate that the amounts due and owing are
subject to adjustment.

With respect to Oakwood's "expectation" of Mariner's "enhancing"
clinical support and personnel functions, Mariner argues that it
is not required under the Term Sheet or Order to make such change
or enhancement. Nevertheless, Mariner disputes Oakwood's
contention that it has not provided appropriate clinical
management to the Oakwood facilities. Moreover, the Term Sheet
provides Mariner an opportunity to continue on as the clinical
manager of the Oakwood facilities after June 30, 2000, if it
meets certain criteria set forth by Oakwood and performs to
Oakwood's satisfaction but Mariner has not been requested to
continue as clinical manager for the Oakwood facilities after
June 30, 2000.

Mariner tells the court hat nothing set forth in the Order or
Term Sheet entitles Oakwood to possession of the books and
records held by Mariner with respect to its management of the
Oakwood facilities.

Therefore, Mariner asks the court to deny the relief sought by
Oakwood and to enter an order compelling Oakwood to immediately
pay all management fees and reimbursable expenses due and owing
under the Court's prior Order and requiring Oakwood to execute a
promissory note by June 30, 2000, in the amount of approximately
$3,281,541.78 should Oakwood fail to provide information
supporting an adjustment.

Oakwood's Response

Oakwood contends that the Term Sheet and Order are written
documents which speak for themselves and Mariner's paraphrase of
those documents is incomplete and inaccurate.

According to Oakwood, Mariner is not entitled to be paid 50% of
the management fees as alleged, and the unpaid amount is
therefore not due and owing.

Oakwood tells Judge Walrath that Mariner has not responded to
each request for financial information, has not produced all
financial records Oakwood requested, and has not complied with
the additional requests from Oakwood's auditors. Moreover, the
information provided has been incomplete, untimely, improperly
formatted and has numerous other deficiencies associated with it,
Oakwood charges.

With regard to improper formatting, Oakwood specifies that the
information was improperly formatted based on a September 30 year
end when the Oakwood books and records required a December 31
year end. Accordingly, the information was not and could not be
properly adjusted for Oakwood's year end, and was of little
value to Oakwood or its auditors.

The reconciliated amount due to Prism as supplied by Mariner,
Oakwood notes, was the result of the same compilation of
information which the parties acknowledged previously was
insufficient to enable Oakwood to engage in the reconciliation

Oakwood contends that in order for it to meaningfully engage in
the process, Oakwood requires the books and records of the
facilities including those that Mariner has held hostage. Oakwood
tells the judge that it has attempted to participate in the "true
up" process but has been hindered due to a lack of information
from engaging in the process.

To the extent that Mariner seeks payment of expenses due Mariner
for, among other things, facilities administrators' salaries,
Oakwood tells the judge that these amounts have been paid.

Oakwood had a clear expectation that the clinical and other
services would be enhanced and patient care improved as a result
of the Term Sheet and Order. The Term Sheet and Order required
Mariner to provide the clinical services contracted for under the
Management Agreements, and Mariner was aware, in February, 2000,
of the deficiencies which existed. The continuation of these
deficiencies, post February 17, 2000 should not entitle Mariner
for compensation for services which were not provided.

Oakwood contends that it cannot be compelled to provide the Prism
Rehab note until all preconditions to providing the note have
been satisfied, including providing Oakwood with all credits due
and engaging in a good faith negotiating process which, by
necessity, includes a free exchange of information.

Accordingly, Oakwood asks the court to deny the Debtors'
crossmotion. (Mariner Bankruptcy News Issue 7; Bankruptcy
Creditors' Service Inc.)

NORTHLAND CRANBERRIES: Renegotiated Loan Default Agreements
Northland Cranberries recently completed renegotiating its bank
loan default agreements.  The SEC filings stated that Northland,
which faces higher debt with decreased sales, has agreed to pay
1.25% interest rate against the prime lending rate in its
headquarters in Wisconsin Rapids and Massachusetts.  Terry
Warfield, associate professor of accounting at UW-Madison says
that Northland could file for bankruptcy if creditors should
declare Northland in default of existing loans.  Northland, which
has a workforce of 300 and produces the Northland and Seneca
bottled juice brands, must have a restructuring plan to improve
its source of funding.

PLATINUM ENTERTAINMENT:  Case Summary and 20 Largest Creditors
Debtor:  Platinum Entertainment, Inc.
          2001 Butterfield Road
          Suite 1400
          Downers Grove, IL 60515

Type of Business:  The production, distribution, marketing and
sale of music

Chapter 11 Petition Date:  July 26, 2000

Court:  Northern District of Illinois

Bankruptcy Case No.:  00-21646

Judge:  Eugene R. Wedoff

Debtor's Counsel:  Michael B. Solow
                    Hopkins & Sutter
                    3 First National Plaza, Suite 4300
                    Chicago, Illinois 60602
                    Tel:(312) 558-6600

Total Assets:  $ 15,754,897
Total Debts :  $ 52,172,198

20 Largest Unsecured Creditors

Steve Devick
1901 Midwest Club Parkway
Oakbrook, IL 60521
Tel:(630) 769-0043
Fax:(630) 769-0048                     $ 1,079,746

Golden Rule Printing
1505 The Boardwalk
Huntsville, AL 35816
Tel:(256) 830-4653
Fax:(256) 830-5621                       $ 863,311

Nimbus Manufacturing, Inc.
P.O. Box 7247
Charlottesville, VA 22906-7427
Tel:(804) 985-1100x777
Fax:(804) 985-4692                       $ 576,851

2255 Markham Rd.
Scarborough, Ontario MIB 2W3
Tel:(877) 301-2255x382
Fax:(416) 298-1595                       $ 400,971

M.C.O.M., Inc.
1045 Firestone Parkway
Larergne, TN 37086
Tel:(615) 641-8510
Fax:(615) 641-8566                       $ 399,286

The Harry Fox Agency, Inc.
711 Third Avenue 8th Flr.
New York, NY 10017
Tel:(212) 922-3260
Fax:(212) 953-2471                       $ 327,966

Craig Duchossois
845 Larch Avenue
Elmhurst, IL 60126
Tel:(630) 530-6100
Fax:(630) 530-6057                       $ 320,252

Ernst & Young
225 Asylum St.
Hartford, CT 06103
Tel:(860) 524-3128
Fax:(860) 524-3123                       $ 264,750

Computer Associates-Platinum
Technology                               $ 247,988

Katten, Muchin & Zavis                   $ 241,008

Morrison & Foerster LLP                  $ 192,997

Born Again Records Inc.                  $ 133,508

CMC Internationl A/S                     $ 132,443

Gator Records                            $ 121,756

Ruf Records                              $ 113,712

Symbiotic, Inc.                          $ 111,029

United Parcel Service                    $ 103,626

Ramblin' Records, Inc.                    $ 92,426

Paul, Hastings, Janofsky & Wal            $ 86,547

TRC Temporary Services                    $ 83,033

TERRA INDUSTRIES:  Moody's Lowers Senior Notes From Caa1 to Caa2
Moody's Investors Service assigned a B2 rating to Terra
Industries, Inc.'s (Terra) $225 million secured asset based
credit facility, maturing 2003, lowered the ratings of its $200
million senior notes, due 2005, and its $159 million senior
notes, due 2003, to Caa2 from Caa1. The senior implied rating is
B3, the senior unsecured issuer rating is Caa2, and the rating
outlook is negative.

The ratings and rating outlook reflect the continued downcycle in
its cyclical commodity products (nitrogen fertilizers and
methanol), the expected continuing pressure on prices and margins
in the intermediate term from global overcapacity in these
products, the uncertain timing of recovery from the product
downcycles, and additional recent margin pressure from
significantly higher U.S. natural gas prices. The ratings also
reflect the high leverage, significant negative quarterly
operating earnings since the June 1999 sale of the distribution
business, possible future asset write-downs, and subordination
considerations. The ratings further consider agricultural market
risks, including the seasonal nature of agricultural sales, the
impact of weather, the effect of farm economies and corn and
wheat production on agricultural sales, and the influence of
government agricultural policies on planting decisions. However,
the ratings also recognize the company's leading positions in
nitrogen solutions in North America and in ammonium nitrate in
the UK, and the benefits and limitations of the new credit

The Caa2 rating of the senior notes reflects that the notes are
at the holding company level without the benefit of guarantees
and are therefore structurally subordinated to the debt
(including substantial senior secured debt) and obligations of
the subsidiaries that own substantially all of the assets.
Therefore the senior notes are notched down two from the Senior
Implied rating.

Nitrogen fertilizer products and methanol continue to experience
global overcapacity and downcycles with adverse price and margin
effects that are expected to continue for the next several years,
Moody's notes. Terra announced June 1, 2000 that it had shut down
its Blytheville, Arkansas ammonia and urea production for up to
six months and curtailed production rates at its other
manufacturing facilities by about 13%. However, on July 24 the
company announced that it will resume production at Blytheville
about August 15, 2000 at about 85% of capacity.

The company is highly leveraged with total debt as of 3/31/00 of
$651 million (including 1999 operating leases of $165 million at
$21 million times 8) compared with LTM revenues of $810 million.

Moody's ratings assume that in the intermediate term the company
will not distribute cash to public unitholders of TNCLP and will
not exercise the right to call the outstanding public units,
which would require a cash payment of about $18 million at the
current TNCLP stock price.

Terra Industries, Inc., headquartered in Sioux City, Iowa,
produces nitrogen fertilizer products (ammonia, urea, nitrogen
solutions, and ammonium nitrate) and methanol.

VENCOR INC: Court Approves Extension of Exclusivity
Vencor, Inc. announced that the United States Bankruptcy Court
for the District of Delaware (the "Court") has approved the
Company's motion to extend the Company's exclusive right to file
its plan of reorganization through August 17, 2000.

In support of its motion, the Company informed the Court that it
has continued to make progress in the reorganization. The Company
noted that it has made substantial progress in its discussions
with Ventas, Inc. (NYSE:VTR), the senior bank lenders, holders of
the Company's $300 million 9 7/8% Guaranteed Senior Subordinated
Notes due 2005 and the advisors to the official committee of
unsecured creditors toward a consensual plan of reorganization.
The Company also reported to the Court that it has continued its
conversations with the Department of Justice regarding a
settlement of the ongoing investigations and regarding the
negotiation of other agreements with the Company. The Company
informed the Court that it is optimistic that it soon will be in
a position to file a consensual plan of reorganization.

The Company and the lenders under the debtor-in-possession
financing (the "DIP Financing") have agreed to permit the Company
to seek an extension of the period of time to file its plan of
reorganization through August 17, 2000.

Vencor and its subsidiaries filed voluntary petitions for
reorganization under Chapter 11 with the Court on September 13,

Vencor, Inc. is a national provider of long-term healthcare
services primarily operating nursing centers and hospitals.

WARNACO GROUP: May Possibly File For Bankruptcy Protection
The distributor for clothes maker Calvin Klein (CK) whose sales
are suffering due to price markdowns and interest costs, may file
for bankruptcy.  The estimated revenues for this year were very
low compared to the expectations for Warnaco Group Inc.  Sales
flopped from $1.81 1/4 to $4.93 3/4 in NSYE and lost 82 percent
of the value of its stock for the past year.  The present lawsuit
with CK contributes to the present dilemma of Warnaco.  Matthew
Hershberg who is an analyst for the S&P Equity Group relates,
"They have a high level of debt," [and] "If they continue on the
same track, they'll likely file for bankruptcy."

Warnaco is also a major player in menswear with Calvin Klein and
Chaps by Ralph Lauren brands; its Authentic Fitness unit is the
North American distributor of Speedo swimwear.  The company sells
to discounters, department stores, and through outlets stores in
North America and Europe.  CEO Linda Wachner owns 7% of Warnaco.
The company is tangled in lawsuits with Calvin Klein, each
accusing the other of trademark violations.


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

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

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

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

                 * * * End of Transmission * * *