TCR_Public/001201.MBX         T R O U B L E D   C O M P A N Y   R E P O R T E R

            Friday, December 1, 2000, Vol. 4, No. 235


ADVANCE HOLDING: Moody's Upgrades Parent & Subsidiary Debt
AHT CORPORATION: Shares Subject to Delisting from Nasdaq
AMERIKING, INC: Moody's Downgrades Restaurant Operator's Ratings
BABCOCK & WILCOX: Court Establishes July 30, 2001 Claims Bar Date
BIRMINGHAM STEEL: Cleveland/Memphis Sale Delayed Until Jan. 31

CLARIDGE HOTEL: Sands Owner Files Competing Chapter 11 Plan
CONSECO, INC: CEO Wendt Articulates Restructuring Goals
DERBY CYCLE: Moody's Downgrades Senior Notes to Caa3
DICTAPHONE CORP: Case Summary & 20 Largest Unsecured Creditors
DYNEX CAPITAL: Board Now Has Five of Six Outside Directors

EMPRESA ELECTRICA: Fitch Lowers Currency Ratings, Stays Negative
FRUIT OF THE LOOM: Enters into EMC Software License Agreement
FTM MEDIA: Failure To Find Buyer May Force Bankruptcy Filing
GRAND COURT: Creditor Wants to File Class Action Lawsuit
GRAND UNION: Delays Quarterly Report, Expects Very Poor Results

GST TELECOMM: New Edge Offers 300 Customers Broadband Services
LERNOUT & HAUSPIE: Files for Chapter 11 Protection in Wilmington
LERNOUT & HAUSPIE: Case Summary & 20 Largest Creditors
NOMURA ASSET: Fitch Completes Mortgage Certificate Rating Review
NORTHLAND CABLE: Moody's Mulls Downgrade on $100MM Note Issue

NORTHLAND CRANBERRIES: Suffers $79.8MM Loss in Fourth Quarter
OPTIMA HEALTH: S&P Affirms HMO's Bpi Financial Strength Rating
OWENS CORNING: Engages Arthur Andersen as Auditors
PACIFICARE HEALTH: Milberg Weiss Files Shareholders' Lawsuit
PILLOWTEX: Employs Morris Nichols as Local Counsel

PSINET, INC: Files Motions to Dismiss Class Action Complaints
RELIANCE GROUP: Fails to Make Payments Due on November 15
RESOURCEPHOENIX.COM: Inks Asset Sale Agreement with Phoenix
SCB COMPUTER: Nasdaq Reverses Decision on Stock Delisting
SERVICE MERCHANDISE: Leasing & Subleasing 6 Stores to Michaels

THERMADYNE MFG: Moody's Junks 9-7/8% Senior Subordinated Notes
TOP AIR: Bank Lender Prefers Liquidation to Reorganization
UNAPIX ENTERTAINMENT: General Electric Extends $40MM DIP Pact
WHEELING PITTSBURGH: Judge Bodoh Enters Vendor Comfort Order
WICKES: Exchange Offer and Consent Solicitation Deadlines Near

* BOOK REVIEW: Going for Broke: How Robert Campeau Bankrupted the
               Retail Industry, Jolted the Junk Bond Market, and
               Brought the Booming 80s to a Crashing Halt


ADVANCE HOLDING: Moody's Upgrades Parent & Subsidiary Debt
Moody's Investors Service upgraded the debt of Advance Holding
Corp., and of its primary operating subsidiary, Advance Stores
Co., Inc. The following ratings were affected by this action:

Advance Holding Corp. (parent company)

     * 12.875% senior discount notes due 2009 to Caa1 from Caa2;
     * Senior unsecured issuer rating to Caa1 from Caa2.

Advance Stores Co., Inc. (operating subsidiary)

     * $125 million senior secured revolving credit facility and
       $340 million secured term loan facilities expiring 2004
       through 2006, to Ba3 from B1;
     * $170 million 10.25% sr. sub. notes due 2008 to B3 from

The company's senior implied rating was raised to B1 from B2. The
rating outlook on all debt is stable.

The upgrade reflects Moody's expectation that Advance will be able
to maintain its improved current financial profile even as its
industry segment continues to perform sluggishly. Although
operating margins and sales growth have been below expectations,
Advance was able to meet debt service obligations and finance
growth through internally generated cash flow.

Cash flow coverage is satisfactory given the industry risks and
Moody's expectation that coverage levels will remain stable in the
near term. EBITDAR less capex to interest plus rents is expected
to remain near current levels of 1.1 times, and debt to EBITDA
should continue to improve gradually from the 3.6 times LTM level.
Cash coverage is somewhat better, since about 15% of Advance's
interest cost reflect non-cash accrual of the parent company
discount notes.

The discount notes begin paying cash interest in 2003. Advance was
able to repay some long term debt this year and has sufficient
availability under its credit facilities to finance anticipated
needs. The ratings are also supported by Advance's size. The
company is the third-largest auto parts retailer in the U.S. by
revenue and it operates in 37 states, Puerto Rico and the Virgin
Islands, although its territory is primarily concentrated in the
eastern half of the country. Its size helps to leverage its
distribution infrastructure and receive favorable vendor terms.

The ratings also reflect high leverage; modest operating
profitability; low return on assets; and stagnant industry
conditions. Lease-adjusted debt to EBITDAR of 5.5 times is
relatively high for a retailer, and Moody's expects it to remain
stable or show gradual improvement over the near term. EBITDA
margins of about 7% and EBIT margins of about 4% are also modest,
and are a contributing factor to relatively low ROA of about 6.5%.
However, Moody's does not believe that these margins are subject
to significant deterioration in the medium term, and may
experience upward movement if Advance is able to improve operating
leverage. The ratings anticipate that gross margins of 39% for the
first nine months of 2000 may have a modest downward adjustment
during the next year due to somewhat slower sell through and a
normalization of vendor terms after remerchandising the Western
Auto stores in 1999.

The rating outlook is stable. Moody's believes that Advance Auto
has completed the integration of the Western Auto stores and is
unlikely to experience further impacts as a direct result of that
acquisition. Future rating actions will depend on Advance's
ability to maintain or improve its operating performance,
financial condition, and market position.

Moody's expects that growth in the auto supply retail segment will
remain sluggish, and that the business will continue to
consolidate to the benefit of the four major players. Moody's
expects the company will grow primarily through organic store
additions, and potentially through acquisition of smaller regional

Advance Holding Corp. and its subsidiaries, headquartered in
Roanoke, Virginia, operate the Advance Auto Parts chain of stores.

AHT CORPORATION: Shares Subject to Delisting from Nasdaq
AHT Corporation (Nasdaq:AHTC) announced that it received a Staff
Determination from Nasdaq on November 20, 2000 indicating that
based on AHT's failure to comply with the filing requirements set
forth in Marketplace Rule 4301(c)(14) as well as the Nasdaq
Staff's review of the company's September 22, 2000 filing under
Chapter 11 of the U.S. Bankruptcy Code and associated public
interest concerns as set forth under Marketplace Rules 4450(f) and
4330(a)(3), AHT's securities are subject to delisting from The
Nasdaq National Market.

AMERIKING, INC: Moody's Downgrades Restaurant Operator's Ratings
Moody's Investors Service downgraded all ratings of AmeriKing,
Inc. Ratings lowered include the $80 million secured revolving
credit facility to B3 from B2, the $45 million secured acquisition
facility to B3 from B2, the $100 million 10.75% senior unsecured
notes to Caa2 from B3, and the $48.9 million 13.5% exchangeable
preferred stock to "c" from "caa". Additionally, the senior
implied rating was lowered to Caa2 from B2 and the issuer rating
to Caa2 from B3. The rating outlook is negative.

The rating action was prompted by continued poor operating
performance at the company's Burger King restaurants, the
company's increasingly leveraged financial condition, and the
company's tight liquidity position. The company has lost access to
the revolving credit facility due to violation of a debt
incurrance test (otherwise there would be about $5 million
available on the $80 million facility). Uncertain management of
the Burger King brand over the longer term also constrains the

However, national marketing and promotions from the combined
resources of all 8,300 Burger King restaurants potentially benefit
the company. We also believe that the company's position as the
largest Burger King franchisee provide economies of scale in
operations and local marketing.

The B3 ratings on the revolving credit facility and the
acquisition line of credit (both due June 2002) recognizes that
the bank loans are guaranteed by the company's operating
subsidiaries and, to the extent permitted under the franchise
agreements with Burger King, secured by the subsidiaries assets.
While the two agreements are separate and distinct, the lenders
are supported equally by collateral. We note that the company has
very little borrowing capacity available on either of these two
bank loans and that the senior notes indenture would not allow the
company to issue additional debt given the cash flow to interest
expense incurrance test of 2.0 to 1.

The Caa2 rating on AmeriKing's senior unsecured notes considers
that these notes are subordinate to more senior debt including the
bank facilities and, through an intercreditor agreement, all
payments due Burger King and other unsecured trade creditors. The
ratings also consider that AmeriKing, a holding company, issued
these notes and its operating subsidiaries do not provide
guarantees. In a distressed scenario, we believe that these notes
could suffer a material loss.

The "c" rating recognizes that the exchangeable preferred stock is
subordinate to a significant amount of more senior debt. The
preferred stock is exchangeable, at the option of the company,
into subordinated debentures due 2008 assuming that the new debt
would not violate bank agreement incurrance tests. AmeriKing may
pay dividends in kind until December 2001. We believe that these
debentures would achieve virtually no recovery in a distressed

The negative rating outlook considers, besides the risks inherent
in operating the company without a liquidity reserve beyond cash
flow from operations, the possible effects on the ratings if the
company's restaurants, and the Burger King system generally, do
not begin to demonstrate permanent improvement within the next
several quarters. We believe that, especially as the June 2002
bank loans maturity date approaches, the company will need to
demonstrate that it is making progress.

The company borrowed heavily to finance an aggressive growth
through acquisition strategy. Since 1994 the company has purchased
332 restaurants from Burger King Corporation and other
franchisees, including many in turnaround situations. This
strategy resulted in purchasing a significant quantity of Burger
King restaurants at the beginning of an unexpected downturn in the
Burger King system. Since many of the restaurants were purchased
at fire-sale prices from distressed franchisees, we expect that
the restaurants can provide a reasonable return on investment as
soon as Burger King Corporation develops an effective marketing

Leverage has remained high with adjusted debt (adjusted for
operating leases) to EBITDA of 6.9 times for the twelve months
ending September, 2000 versus 6.5 times for the December 1999
fiscal year and 6.2 times for the December 1998 fiscal year.
Interest coverage has also remained tight with EBITDA to interest
expense of 1.8 times for the twelve months ending September 2000
versus 2.1 times for Fiscal 1999. Since the company has
drastically curtailed capital investments beyond completing two
restaurants currently under construction, we expect that the
company can meet cash interest payments and minimal maintenance
capital expenditures from cash on hand and operating cash flow for
the next two quarters until the company reaches the peak months
for cash generation during the spring and summer, assuming that an
unexpected event does not occur.

AmeriKing Inc, headquartered in Westchester Illinois, operates 378
Burger King restaurants across 13 Midwestern and Southern states.

BABCOCK & WILCOX: Court Establishes July 30, 2001 Claims Bar Date
The Court-ordered notification and claims process that began in
connection with the Chapter 11 reorganization involving The
Babcock & Wilcox Company and certain of its subsidiaries ("B&W")
includes claims related to contamination or radiation from the
former B&W nuclear processing facilities in Apollo, Pennsylvania
or Parks Township, Pennsylvania. To preserve a claim against B&W,
it must be filed and received by July 30, 2001 (the "Bar Date.")
On February 22, 2000, B&W filed for protection under Chapter 11 of
the U.S. Bankruptcy Code to determine and comprehensively resolve
its asbestos liability claims. As part of the reorganization
process, B&W must alert those who have claims related to
contamination or radiation from nuclear processing facilities in
Apollo, Pennsylvania or Parks Township, Pennsylvania. Generally,
this does not prohibit claims for injuries that are not currently
manifested as of the Bar Date from being filed in the future.

Those who do not file a claim by the Bar Date will lose the right
to bring such a claim against B&W in the future. Filing a claim
does not necessarily entitle claimants to compensation. For valid
claims, the amounts and dates when payments will be issued have
not been determined.

Prior to the Bar Date, notices will be mailed to potential
claimants and attorneys, and are scheduled to appear in newspapers
-- including many in the western Pennsylvania area relating to the
Apollo-Parks Township claims -- magazines, and on television
throughout the United States. Notices will also be disseminated in
Canada, the United Kingdom and the Philippines. Information about
the claims process will also be made available through the

Claimants may call toll free 1-877-657-9158, write to Claims
Agent, Re: Babcock & Wilcox, P.O. Box 9495, Minneapolis, MN 55440-
9495, USA, or visit the website at http://www.bwbardate.comto  
receive more information including a long form notice and claim
form. Claimants are asked not to contact the Courts.

B&W purchased the Nuclear Materials & Equipment Corp. plant in
Apollo, Pennsylvania from Atlantic Richfield Co. in 1971. The
plant processed uranium for nuclear reactors and Navy submarines.
The factory stopped producing uranium and shut down in 1986 under
B&W's ownership. Although the plant was razed in the early 1990s,
certain individuals including their families and heirs may have a
claim against B&W relating to exposure to or contamination by
radioactive material.

The Chapter 11 filing by The Babcock & Wilcox Company includes its
subsidiaries Americon, Inc., Babcock & Wilcox Construction
Company, Inc., and Diamond Power International, Inc. Because this
is a voluntary Chapter 11 filing and B&W remains solvent, the Bar
Date does not apply to unsecured creditors whose claims do not
relate to asbestos or certain nuclear contamination issues.
Accordingly, commercial creditors and suppliers need take no
action. Also, all employee wages, salaries, benefits and retiree
benefits are unaffected and protected.

The Bar Date also involves claims related to Asbestos Personal
Injury Claims, as well as Derivative Asbestos Claims or Asbestos
Property Damage Claims relating to asbestos exposure from a
worksite, including ships, that had a B&W boiler system, or
involving other B&W asbestos-related components. Complete
descriptions of the claims subject to the Bar Date including more
details about the claims process may be found in the long form
notice and claim form that is available at the official website or by calling the toll free call center
at 1-877-657-9158.

BIRMINGHAM STEEL: Cleveland/Memphis Sale Delayed Until Jan. 31
Birmingham Steel Corporation (NYSE:BIR) reported it has agreed to
a revised closing date of January 31, 2001, for the sale of its
Cleveland and Memphis SBQ operations to North American Metals,
Ltd. ("NAM"). The closing for the transaction had previously been
set for December 1, 2000.

Birmingham Steel said the transaction is subject to the approval
of the Company's board of directors and its lenders. John
Correnti, Chairman and Chief Executive Officer of Birmingham
Steel, commented, "NAM requested an extension of the Purchase
Agreement in order to finalize certain details regarding the
financing of the transaction. Based upon NAM's demonstrated
progress toward securing financial support for the transaction and
its recent success in attracting experienced management for the
venture, we have agreed to extend the deadline for closing the
purchase until January 31, 2001. However, we are optimistic the
transaction can be completed prior the revised closing date."
Birmingham Steel operates in the mini-mill segment of the steel
industry. Birmingham Steel's stock is traded on the New York Stock
Exchange under the symbol "BIR".

CLARIDGE HOTEL: Sands Owner Files Competing Chapter 11 Plan
The Sands Hotel & Casino announced that GB Holdings, Inc., the
parent company of the Sands Hotel & Casino, has filed a proposed
Disclosure Statement and Plan of Reorganization in the bankruptcy
cases involving the Claridge Hotel and Casino located in Atlantic
City, New Jersey.

Alfred J. Luciani, the President and CEO of the Sands said, "We
believe that we have proposed a transaction that will be
beneficial to the Sands stockholders and the Claridge and will
permit the combined companies to go forward as strong
competitors." Under the proposed plan, a total of 5,652,000 shares
of the common stock of the Company and certain cash would be
distributed for the benefit of the holders of the Claridge First
Mortgage Notes and trade creditors would receive a cash
distribution of a minimum of 75% of their allowed claim amount on
the effective date of the Plan or such higher amount as the
Bankruptcy Court permits.

Mr. Luciani stated that he anticipated that the regulatory
approvals necessary for the acquisition could be obtained
expeditiously. "GB Holdings, which is currently licensed to own
the Sands Hotel & Casino, would not face the type of opposition
based on economic concentration, as would be inherent in an
application by a large, multiple-licensed casino operator in
Atlantic City."

Park Place Entertainment Corporation has also filed a plan of
reorganization in this case, pursuant to which, inter alia, Park
Place would acquire the Claridge Hotel and Casino. For the
following reasons, the Company believes that its plan is superior
to Park Place's plan:

   (I) The Company believes that its Plan provides for a
distribution of a higher value to holders of First Mortgage Notes
and other creditors;

  (II) The distribution of common stock of the Company will allow
the holders of the First Mortgage Notes to participate in any
increase in value of the Company;

(III) While the Company intends to consolidate some of the
operating departments of the Sands and the Claridge, the Company
intends to keep the casino at the Claridge open and believes that
Park Place may plan to close the casino; and

  (IV) The Company believes that Park Place, self described as the
world's largest gaming company, which already operates four
casinos under three casino licenses in New Jersey, wields
significant purchasing power and adding a fifth casino to its
realm in Atlantic City would augment its purchasing power and
allow it to achieve cost savings at the expense of trade

CONSECO, INC: CEO Wendt Articulates Restructuring Goals
The attached "Turnaround Memo No. 4" from Conseco (NYSE:CNC) CEO
Gary C. Wendt was posted on Conseco's web site for shareholders
and/or electronically distributed to them.

Turnaround Memo No. 4

To: Conseco Shareholders

From: Gary Wendt, Chairman & CEO

Date: November 29, 2000

Far and away the biggest news since my last update is A.M. Best's
decision on November 7 to upgrade our rating to A-. The loss of
this rating in mid-June had prompted the following kinds of
conclusions from various analysts:

July 28: "The A.M. Best rating is of particular importance as
94% of all life insurance, 96% of all annuities and 84% of all
health insurance is sold by companies with an A- rating or

September 28: "... we suspect that CNC will need to
demonstrate continued progress in its stabilization plan
before ratings upgrades would be rewarded."

November 1: " ... we caution investors about assuming that (an
upgrade to A-) will occur by the end of 1Q01."

So, securing the upgrade this quickly was a very welcome event.

Shortly after joining Conseco, I identified three near-term goals:

   (1) restructure the bank debt;

   (2) implement a business model at Conseco Finance to produce
        cash instead of use it; and

   (3) restore the A- Best rating. With the recovery of the A-
        rating, Phase 1 of the Conseco turnaround is clearly on

As we noted in our 3rd quarter earnings release, the loss of this
rating for nearly four months did depress sales of annuities and
life insurance products and put some pressure on insurance
margins. Now, however, we are positioned to start 2001 with no
ratings impediment to sales or earnings.

Let me update you on a few other Turnaround developments that have
occurred since our 3rd quarter earnings release.

     1. Cash generation and debt repayment. As you know, our
Restoration Plan calls for the retirement of $2 billion in
debt. In September, we repaid $650 million of bank debt. On
December 15, we will retire $132 million in public debt. These
two repayments alone will reduce Conseco's annual interest
expense by approximately $68 million. Fully diluted and after
tax, that is approximately 11 cents per common share!
Progress continues on the sale or monetization of non-core
assets. We expect to announce the sale of one of our assets in
the next 10 days.

But, please also keep in mind that the original list of assets
to be monetized was a conservative list at conservative
valuations. Conseco is a large and vibrant company with a
short-range motto of "Cash is King." You should expect that we
will be generating cash from sources not anticipated when we
put our asset list together last summer. Just last week, we
recovered $30 million from Lehman Brothers as a refund of a
deposit against anticipated fees during the company's attempt
to sell Conseco Finance in the spring. The transaction has no
net effect on the income statement or balance sheet, but it is
a "new" source of cash for debt repayment.

Recent press articles about two of the assets we are in the
process of selling probably caught your attention. A quick
word on each:

   -- Tritel has completed its merger with Telecorp with analysts
giving positive reports on the combination. (Conseco holds 17.18
million shares of the merged entity, TLCP.) This asset is
scheduled for sale later in 2001.

   -- Our effort to realize maximum value for the Argosy gambling
boat continues to wind through the courts. Recently, the Illinois
Supreme Court ordered that Argosy may not halt our actions in
Indiana, where our pleadings are pending. Given the vast valuation
differences between the majority owner and ourselves, we think
enforcing our contracts in the courts is in Conseco's interests.

     2. Insurance Restructuring. In my last Turnaround Memo, I
described the "de-layering" of Conseco's management structure.
The second phase of restructuring our insurance operations is
shifting staff responsibilities from the corporate level to
the business operating level. We have been moving rapidly during
the past month to move these key business professionals into
positions at the operating level. So far, we have moved
approximately 400 accounting, finance, actuarial, marketing,
compliance and market conduct staff from corporate staff to
positions in operating businesses.

A large centralized bureaucracy at the parent company level is
a bad idea. My experience is that high returns and high quality
will be achieved when business staffs are as close to the front
lines as possible.

     3. Brand awareness. I thought you would be interested in the
following information just in. In its target markets, Conseco's
brand has reached a record 65% (October '00) awareness level, up
from just 8% in February '98. The study was conducted in October
by Communicus (CCS), a third party research firm that also
monitors brands for IBM, Quaker Oats, and BMW. The study measured
awareness, favorability, purchase intent, reputation and other
factors. Conseco continues to make steady progress on all fronts.
Interestingly, there is no indication that our target market,
middle income Americans, has been affected at all by news of this
past year's difficulties at Conseco.

     4. Investor Briefing. On December 14 we will host an investor
briefing here in Indianapolis. We will use this occasion to
release earnings guidance for 2001. That information will be
publicly released simultaneously. The briefing will begin at
10:30 a.m. and end at 12:30 p.m., followed by lunch here at
our conference center. Obviously our focus is on prospective
investors in Conseco, but we will be pleased to accommodate as
many current shareholders as possible. Contact our investor
relations department for more information.

As usual, please feel free to share your comments and
questions. We will continue to answer them directly or in
future Turnaround Memos.

DERBY CYCLE: Moody's Downgrades Senior Notes to Caa3
Moody's Investors Service downgraded to Caa3 from Caa1 the ratings
of The Derby Cycle Corporation's $100 million of 10% senior notes
and DM 110 million (US $49 million) of 9.375% senior notes, both
due 2008. Lyon Investments B.V., a wholly owned subsidiary of
Derby, is a co-issuer of the notes. As co-issuers both companies
are jointly and severally liable for these obligations. Moody's
also downgraded the rating of Derby's DM 209.5 million (US $94.5
million) secured revolving credit facility to B3, from B1. The
senior implied rating was downgraded to Caa1, from B2, and the
senior unsecured issuer rating to Caa3, from Caa2.

The outlook remains negative.

The downgrades reflect Derby Cycle's continued high leverage,
negative operating income and interest coverage resulting from
third quarter inventory adjustments and constraints on the
company's liquidity due to repeated covenant violations. The
company recently was unable to borrow under its credit facility
(due to covenant violations) while it was in negotiations with its
banks, which have now been completed.

Financial flexibility was constrained by a reduction in Derby's
credit facility from DM214 to DM183 ($83 million) on June 30, 2000
as a result of asset sales (related to a property sale in December
1999 and the sale of Sturmey Archer). On August 6th and October
1st of this year the company violated certain financial covenants,
which it subsequently received a waiver for through October 30,
2000. Derby recently completed negotiations with its bank group
and investors to increase borrowing capacity, amend the credit
agreement covenants and obtain additional equity. The bank group
has agreed to a seasonal increase to the revolving line of credit
of DM 26.5 million ($11.5 million), which is available to the
company during its peak borrowing period of January to May, along
with covenant amendments and an acceleration in the maturity date
to June 30, 2002. In addition, the existing sponsors and an
additional investor have committed new capital of $12 million.
This capital ($2.25 million each from Thayer Equity Investors III,
L.P. and Perseus Cycle, LLC and $7.5 million from Quantum
Industrial Partners, LDC, a Soros affiliate) is in the form of
preferred stock with a 30% annual non-cash dividend. The existing
sponsors have also converted their $7 million junior subordinated
note, plus PIK interest, into $7.4 million in preferred stock with
a 19% annual non-cash dividend. This note resulted from the July
2000 conversion of the sponsors' interest free bridge loan.

Revenue growth for the nine months ended October 1, 2000 was 3%
year over year. However, overall unit sales increased by 6% and
without adjustments for the decline in the EURO, revenue growth
would have been 11.5%. In the U.K. sales were lower on a nine-
month basis due to an overall market decline, increased
competition, under-stock in certain areas due to supply problems,
and the scale-back in purchases by a key customer. Derby USA
experienced a third quarter decline in revenues due to a
reorganization of the sales force and lower parts sales related to
the reorganization and continued integration of the Diamond Back
business. Although sales in Germany were up 10%, gross margins
were negatively impacted by inventory adjustments and increased
provisions related to the implementation of a new ERP system in
late 1999, a shift in product mix and the need to shut down plants
to reduce inventory levels. Derby recorded charges of $10.5
million in the third quarter related to these adjustments and an
additional $2.3 million for inventory reserves in the U.K. and
USA. Derby USA also took a $1.5 million receivable write-off
related to the Diamond Back business. For the third quarter ended
October 1, 2000, the company reported negative EBITDA of $23
million and LTM EBITDA of $6.3 million.

Total debt was $215 million resulting in extremely high leverage
in excess of 30 times and negative interest coverage for the third
quarter and LTM ended October 31, 2000.

The continued negative outlook reflects concern over Derby's
ability to generate positive operating results for the fourth
quarter and its ability to maintain on-going loan compliance via
profitable results for fiscal year 2000. The company's inability
to do so could result in further rating downgrades.

Headquartered in Stamford, Connecticut, The Derby Cycle
Corporation is one of the world's largest designers, manufacturers
and marketers of bicycles. Its operations are centered in the
U.K., The Netherlands, Germany, the United States and Canada;
with additional sales and marketing operations in Europe and South
Africa. Its brands include, among others, Raleigh, Nishiki,
Univega, Gazelle, Winora and Diamond Back.

DICTAPHONE CORP: Case Summary & 20 Largest Unsecured Creditors
Debtor: DictaPhone Corporation
         3191 Broadbridge Avenue
         Stratford CT 06614
         Fairfield County, CT

Type of Business: The debtor develops, manufactures, markets,
                  services and supports integrated voice and data
                  management systems and software, including
                  dictation, voice processing, voice response,
                  unified messaging, records management, call
                  center monitoring systems and communications

Affiliate: Lernout & Hauspie Speech Products N.V.
            L&H Holdings USA, Inc.

Chapter 11 Petition Date: November 29, 2000

Court: District of Delaware

Bankruptcy Case No.: 00-04397

Debtor's Counsel: Robert J. Dehney, Esq.
                  Morris, Nichols, Arsht & Tunnell
                  1201 North Market Street
                  PO Box 1347
                  Wilmington, Delaware 19899-1347
                  (302) 658-9200


                  Luc A. Despins, Esq.
                  Milbank, Tweed, Hadley & McCloy, LLP
                  1 Chase Manhattan Plaza
                  New York, NY 10005
                  (212) 530-5000

Total Assets: $ 1,018,820,000
Total Debts : $   389,698,000

Consolidated List of Dictaphone and
Lernout & Hauspie's 20 Largest Unsecured Creditors:

Havenlaan 2, 1080
Brussels, Belgium
Dirk De Bleser
Tel: 32 2 429 42 76
Fax: 32 2 429 49 20            Bank Loan             $ 145,804,347

Shawmut Bank Connecticut,
National Association,
Trustee relating to the
11 1/4 Sen Sub Notes
due Aug 1, 2005
777 Main Street
Hartford, CT 06115             Sen Sub Notes         $ 142,416,000

Fortis Bank N.V.
3 Montagne du Parc
100 Brussels, Belgium
Hans De Langhe
Corporate Credit Dept.
Tel: 32 02 228 06 05
Fax: 32 02 228 06 39           Bank Loan             $ 123,913,044    

Artesia Banking
Corporation N.Vv.
Koning Albert II Taan
30, Box 2, 1000
Brussels, Belgium
Piet Cordonnier
Tel: 32 02 204 52 61
Fax: 32 02 204 32 41           Bank Loan              $ 41,304,438

Deutsche Bank N.V.
Lange Gaethiestraat 9,
2000 Antwerp, Belgium
Peter Van Raemdonck
Tel: 32 02 551 64 88
Fax: 32 02 551 63 09           Bank Loan              $ 19,565,217

Dresdner Bank Luxembourg
Rue Du Marche-aux-Herbes
26, L-1728
Christian Kogge
Tel: 00352-4760-255
Fax: 0352-4730-824             Bank Loan              $ 19,413,044

Deutsche Bank AG
31 West 52nd Street
New York, NY 10019
Tel: 212-469-8000              Bank/Letter of
Fax: 212-469-8115              Credit Facility        $ 14,272,505

SG Cowen Capital
Securities Corporation
1221 Avenue of the
New York, NY 10020
Ben Howe
Tel: 212-278-4297
Fax: 617-946-3766              Professional Fees       $ 8,000,000

Wyle Electronics
15360 Barranca Pkwy
Irvine, CA 92618
Joe Jovene
Tel: 949-453-4387
Fax: 949-753-9890              Trade Debt              $ 4,433,491

Brown, Rudnick, Freed
& Geamer
One Financial Center
Boston, MA 02111
Tel: (617) 856-8200
Fax: (617) 856-8201            Legal Fees              $ 1,500,000

Finova Capital
2650 S. Decker Lake
Lane, 2nd Floor
PO Box 30028
Salt Lake City, UT
Tel: 800-748-44457 x3582
Fax: 801-924-2190              Trade Debt              $ 1,385,000

Victor Company of Japan,
Co., Ltd.
12, 3-chome, Moriya-cho,
Kanagawa-ku, Yokohama,
Tel: Kanagawa-pref. 221-8528
Fax: 011 81 45 4502568         Trade Debt                $ 719,064

Amherst Computer
10 Columbia Drive
Amherst, NH 03037
Tel: 603-889-6820
Fax: 603-577-9400              Trade Debt                $ 530,860

Predictive Technologies
560 Rustic Trail
Beavercreek, OH 45434
Tel: 937-272-2352
Fax: 937-320-9017              Trade Debt                $ 474,021

Olympus Optical Co., Ltd.
San-Ei Building
22-2, Nishi Shinjuku, 1-
chome Shinjuku, Tokyo,
H. Kakizaki
Logistics Development Dept.
Tel: 011-81-3-3345-0885
Fax: 011-81-3-3340-2201        Trade Debt                $ 469,664

Radisys Corporation
5445 NE Dawson Creek Dr.
Hillsboro, OR 97124
Tel: (800) 950-0044
Fax: (503) 615-1115            Trade Debt                $ 412,156

OSS Corporation
One Enterprise Drive
Suite 109
Shelton, CT 06484
Tel: (203) 925-1083
Fax: (203) 925-1303            Trade Debt                $ 364,838

Centennial Technologies
7 Lopez Road
Wilmington, MA 01887
Tel: (978) 988-8848
Fax: (978) 988-7661            Trade Debt                $ 266,257

Patton Boggs LLP               Legal Fees                $ 225,000

Sanyo Electric (HK) Ltd.       Trade Debt                $ 212,207

DYNEX CAPITAL: Board Now Has Five of Six Outside Directors
Dynex Capital, Inc. (NYSE: DX) announced that at a special meeting
held on November 21, 2000, its Series A, Series B and Series C
preferred shareholders elected Mr. Leon A. Felman and Mr. Barry
Igdaloff to the Company's Board of Directors.

The election of Mr. Felman and Mr. Igdaloff increases the number
of board members from four to six, five of whom are outside

Mr. Felman has been a director of Allegiant Bancorp, Inc., a St.
Louis, Missouri based bank holding company, since 1992. For
thirty-one years prior, Mr. Felman was the president and chief
executive officer of Sage Systems Inc., which operated twenty-
eight Arby's restaurants in the St. Louis, Missouri metropolitan
area. Mr. Felman graduated from Carnegie Institute of Technology
with a B.S. in Industrial Administration.

Mr. Igdaloff has been a Registered Investment Advisor and the sole
proprietor of Rose Capital in Columbus, Ohio, since 1995. Mr.
Igdaloff graduated from Indiana University in 1976 with a B.S.B.
in Accounting and in 1978 graduated from Ohio State University
with a J.D. in law.

Dynex Capital, Inc. is a financial services company that elects to
be treated as a real estate investment trust (REIT) for federal
income tax purposes.

EMPRESA ELECTRICA: Fitch Lowers Currency Ratings, Stays Negative
Fitch has downgraded the local and foreign currency ratings of
Empresa Electrica del Norte Grande S.A. (Edelnor) to `B-' and
maintained its Rating Watch Negative status. Approximately $340
million of debt is affected.

The rating action is a result of further analysis of the company's
prospective financial performance and liquidity concerns. The
ratings were placed on Rating Watch Negative earlier this year
following the rejection of Edelnor's Environmental Impact Study
(EIS) to burn petroleum coke (petcoke) in its coal-fired plants.
Edelnor is expected to submit a new EIS to the COREMA, the local
government environmental agency, during the first quarter of 2001.
However, even if Edelnor were able to burn petcoke, the system
spot price would still most likely be at the marginal cost of the
natural-gas generated energy and would not provide a material
short-term benefit to the company's margins or cash flow
coverages, a contributing factor in the current rating action.
Substantial new generation developed in the northern region of
Chile will greatly exceed demand for the next several years with
demand being served mostly by generation fueled by natural gas and
possibly petcoke-blended fuel. Node prices and spot prices have
been driven down putting pressure on Edelnor's margins and cash
flow. As the company becomes increasingly exposed to spot market
prices, cash flow will likely continue to be affected.

Edelnor reported EBITDA-to-interest of 1.42 times (x) through
September 2000, which included non-operating income of
approximately $12 million related to insurance proceeds. Excluding
this income, coverage ratios were below 1.0x. Edelnor's cash flow
will be impacted by the loss of the 58mw Escondida contract, which
expired in August 2000. Cash flow will likely be further affected
in 2002 following the loss of the EMEL supply contracts, which are
priced higher than current spot prices. The loss of the EMEL
contracts will reduce contracted capacity to less than 25% of
Edelnor's installed capacity of 653mw.

The company is also facing liquidity issues given its required
expenditures and payments in 2000 and 2001, making reliance on
positive internal cash flow important. The cash balance as of
Sept. 30, 2000 was $17 million, after a coupon payment of $9.687
million, including a $5 million executed line of credit which
matures in March 2001. The next coupon payment in the amount of
$4.725 million is due Dec. 15, 2000. Longer term, Edelnor may find
it difficult to access the funds required to meet its bullet
maturities in 2005 and 2006 based on its financial performance and
risk conditions of the Chilean electricity market.

Edelnor is a Chilean electric generating and transmission company
that supplies electricity under long-term purchased power
agreements to distribution companies and large industrial
consumers in Chile's northern region. Edelnor is owned primarily
by Southern Energy, Inc. (NYSE: SOE), which announced its intent
to sell its Chilean operations at year- end 1998.

FRUIT OF THE LOOM: Enters into EMC Software License Agreement
Union Underwear, a subsidiary of Fruit of the Loom, asks the
Court's permission to enter into a master lease and software
license agreement with EMC Corporation, Hopkins, Massachusetts.
The proposed agreement, lease No. 12394, grants Union Underwear a
non-exclusive, non-transferable license to use EMC core and
enterprise storage software, including host-based and symmetrix-
based software that manages and stores information systems data.
J. Kate Stickles Esq., on behalf of Union Underwear, tells Judge
Walsh that the EMC equipment provides critical information systems
and storage capacity, which allows more effective business

The aggregate three-year rent is $945,288, based on thirty-six
monthly rent payments of $26,258. The equipment has an original
cost of $863,000. The master lease requires a letter of credit for
30% of the aggregate rent or $284,790. In addition, EMC requests a
certificate that documents liability and property insurance
coverage for the leased equipment. Dan Abell, Vice President
Management Information Systems at Union Underwear, signed the
proposed agreement.

Ms. Stickles asserts that this transaction is in the ordinary
course of business. Entry into the lease is a reasonable business
decision. There is sound business justification for the
transaction. Union Underwear states that the terms were negotiated
at an arm's length and are fair.(Fruit of the Loom Bankruptcy
News, Issue No. 17; Bankruptcy Creditors' Service, Inc., 609/392-

FTM MEDIA: Failure To Find Buyer May Force Bankruptcy Filing
Suspending operations in October due to a cash crunch, FTM Media
Inc. now says it will need file for bankruptcy protection unless
it finds a buyer by mid-December, according to a report circulated
by Dow Jones.  FTM adds that it is already in talks with an
undisclosed prospective buyer.  Those talks focus on a sale or
merger of the firm or obtaining additional funding for operations.
"If these negotiations are not successful within thirty days of
the date of this report, (the) company will file for protection
under federal bankruptcy law," an SEC filing released Nov. 15
states.  The filing also stated that if the company does file for
bankruptcy, bondholders may lose all ownership or their stake
might be reduced to little or nothing.

FTM Media, whose shares trade on the Over-the-Counter Bulletin
Board, develops electronic media for major-market radio stations.

GRAND COURT: Creditor Wants to File Class Action Lawsuit
In a memorandum circulated to various parties-in-interest in the
on-going chapter 11 restructuring of Grand Court Lifestyles, Inc.,
Murray Shelton (561/499-8957 or urges fellow
creditors to "contact me as soon as possible regarding the
possibilities of collaborating together on a class action lawsuit
against Grand Court Lifestyles, Inc."  

Grand Court Lifestyles, Inc., filed for chapter 11 protection in
Newark, New Jersey, in March. At that time, the Company reported
$319 million in assets and $283.6 million in liabilities.
Grand Court syndicates and manages 56 senior living communities
and has a portfolio of about 100 multifamily properties, all of
which are owned by limited partnerships. However, none of these
partnerships are currently part of the chapter 11 proceeding. Jack
Zackin, Esq., of Sills Cummis Zuckerman Tischman Epstein & Gross
P.C. in Newark, N.J., represents the debtor along with colleague
Andrew Sherman, Esq.

GRAND UNION: Delays Quarterly Report, Expects Very Poor Results
Compared to the previous year's results, Grand Union Co. operating
results for the quarter ending Oct. 14 will be "significantly
worse."  Grand Union's operations have dwindled and after a
charge-off of $112 million for its reorganization, quarter results
will negatively impacted.  Grand Union made these disclosures in
the context of telling the SEC that its next Form 10-Q will be

Grand Union commenced its third Chapter 11 case in the U.S.
Bankruptcy Court in Newark, N.J., reporting assets of $749.5
million and debts of $804 million as of July 22.  The grocer is
rapidly liquidating its assets.

GST TELECOMM: New Edge Offers 300 Customers Broadband Services
New Edge Networks announced it has reached an agreement to offer
advanced broadband services to more than 300 GST
Telecommunications business customers whose service will be
discontinued in January.

Time Warner Telecom Inc., which has federal court approval to buy
most of GST's assets after bankruptcy proceedings, does not intend
to continue supporting or selling frame relay services and will
discontinue service. Affected customers are required to select and
transition their service to a new provider to avoid service
disruption on Jan. 10.

Under terms of the agreement, New Edge Networks and GST jointly
initiate contact with affected GST customers throughout the
Western United States with an offer to seamlessly convert their
Network-to-Network Interface (NNI) circuits, Virtual Private
Networks, Wide Area Networks (WAN) or frame relay services. New
Edge Networks will pay GST a sign-on bonus for customers who
convert their service to New Edge Networks. For New Edge Networks,
the agreement could boost by 50 percent its base of customers and
revenue from these advanced broadband services.

"GST and New Edge Networks will work closely together to
seamlessly transition existing service so customers avoid any
service disruptions or the need to find a new service provider
before service is discontinued in a few weeks," said Keith Rinne,
president of the WAN services group at New Edge Networks.
"Customers can expect improved network reliability and faster
access to new competitive services in more locations around the

Earlier this month New Edge Networks acquired West-Net, Inc., a
privately-owned data communications network service provider, to
jump-start New Edge Networks' strategic plans for offering
advanced broadband services such as WANs, virtual private
networks, computer LAN-to-LAN internetworking and frame relay.
West-Net forms the nucleus of New Edge Networks' new WAN services
group that provides service to a wide range of small companies to
large corporations on the Fortune 1000 list. For more information
about these advanced broadband products and service, visit

New Edge Networks operates one of the largest national ATM data
communications networks with 16 regional aggregation points in
major cities and more than 560 nodes around the country. Monitored
around the clock, the ATM network provides customers high
performance, fast access and widespread connectivity at lower

Based in Vancouver, Wash., New Edge Networks was founded in June
1999 to provide wholesale broadband DSL services nationally in
small, midsize and semi-rural markets through local, regional and
national Internet service providers, communications companies, and
other strategic relationships. The company is certified to provide
service in 49 states, and is focusing on introducing data service
first and later overlaying voice, video and other value add
services such as frame relay. The company's national ATM backbone
network currently has more than 560 nodes making it one of the
largest in the country. The company's Web site is

LERNOUT & HAUSPIE: Files for Chapter 11 Protection in Wilmington
Lernout & Hauspie Speech Products NV (NASDAQ: LHSP, EASDAQ: LHSP),
a world leader in speech and language technology, products and
services, announced that it has voluntarily filed a Chapter 11
petition for reorganization protection under the U.S. bankruptcy
code and that it would file a request for a concordaat
reorganization under Belgian law.

The chapter 11 filing, made in Wilmington, Delaware, will enable
L&H to continue addressing its past problems, while developing a
new strategic plan to leverage the Company's unparalleled base of
technology assets and market access, as well as restore
profitability. In addition to the filing, L&H is in active
negotiations to obtain debtor-in-possession financing.

John Duerden, President and Chief Executive Officer of L&H, said:
"We have tried, without success, to reach an acceptable
accommodation with our bank lenders. After an intensive analysis
of L&H's world-wide business operations and a careful assessment
of its financial position, we concluded that a voluntary
reorganization filing is both prudent and necessary to preserve
and rebuild our valuable customer base and technology assets."

Daniel Hart, General Counsel of L&H explained that, "an important
factor in the decision to seek reorganization protection was the
recent discovery of a very significant cash shortfall on the
balance sheet of the Korean subsidiary, the circumstances of which
we will vigorously investigate with the assistance of external

Mr. Duerden expressed confidence that this was the right decision
for the company at this time: "This court-supervised process will
enable us to focus on realizing the enormous commercial potential
of L&H's considerable technology resources, while continuing to
investigate and remediate problems emanating from the past."
Roel Pieper, Chairman of the Board, said, "Despite L&H's financial
situation, we remain a market and technology leader, which gives
us a strong foundation on which to build a new and profitable
company. With this reorganization we now have the opportunity to
chart a new course for L&H."

In the US, the filing was made by Lernout & Hauspie Speech
Products NV, Dictaphone Corporation, and L&H Holdings USA, Inc.,
the successor corporation to Dragon Systems Inc., for
reorganization under Chapter 11 of the U.S. Bankruptcy Code. In
Belgium, a concordaat reorganization filing will be made by
Lernout & Hauspie Speech Products NV.

Lernout & Hauspie (L&H) is a global leader in advanced speech and
language solutions for vertical markets, computers, automobiles,
telecommunications, embedded products, consumer goods and the
Internet. The company is making the speech user interface (SUI)
the keystone of simple, convenient interaction between humans and
technology, and is using advanced translation technology to break
down language barriers. The company provides a wide range of
offerings, including: customized solutions for corporations; core
speech technologies marketed to OEMs; end user and retail
applications for continuous speech products in horizontal and
vertical markets; and document creation, human and machine
translation services, Internet translation offerings, and
linguistic tools. L&H's products and services originate in four
basic areas: automatic speech recognition (ASR), text-to-speech
(TTS), digital speech and music compression (SMC) and text-to-text

LERNOUT & HAUSPIE: Case Summary & 20 Largest Creditors
Debtor: Lernout & Hauspie Speech Products N.V.
        52 Third Avenue, Burlington, MA 01803
        Middlesex County, MA

Affiliates: Dictaphone Corporation
            L&H Holdings USA, Inc.

Chapter 11 Petition Date: November 29, 2000

Court: District of Delaware

Bankruptcy Case No.: 00-04398

Debtor's Counsel: Robert J. Dehney, Esq.
                  Morris, Nichols, Arsht & Tunnell
                  1201 North Market Street
                  PO Box 1347
                  Wilmington, Delaware 19899-1347
                  (302) 658-9200


                  Luc A. Despins, Esq.  
                  Milbank, Tweed, Hadley & McCloy, LLP
                  1 Chase Manhattan Plaza
                  New York, NY 10005
                  (212) 530-5000

Total Assets: $ 2,372,776,000
Total Debts : $   255,311,000 (Short Term)
              $   234,297,000 (Long Term)

NOMURA ASSET: Fitch Completes Mortgage Certificate Rating Review
Fitch lowers its ratings for the following Nomura Asset Securities
Corporation mortgage pass-through certificates:

   --Nomura 1994-2 Group 2, Class 2M-3 ($356,900 outstanding),
     rated 'BB' and on Rating Watch Negative is downgraded to
     'CCC' and removed from Rating Watch Negative.

The action is the result of a review of the level of losses
incurred to date and the current high delinquencies relative to
the applicable credit support levels. As of the Oct. 25, 2000
distribution, Nomura 1994-2 Group 2 remittance information
indicates that 5.08% of the pool is over 90 days delinquent, and
cumulative losses are $1,028,023 or 2.37% of the initial pool.
Class 2M-3 currently has 0.61% of credit support, and class 2-B1
has no credit support remaining.

NORTHLAND CABLE: Moody's Mulls Downgrade on $100MM Note Issue
Moody's Investors Service placed the B3 rating for $100 million of
10-1/4% senior subordinated notes issued by Northland Cable
Television, Inc. (Northland) under review for possible downgrade.
The former Ba3 ratings for the company's senior secured bank
credit facilities have been withdrawn as these facilities have
been refinanced.  Northland's B2 senior unsecured issuer and B1
senior implied ratings were also placed under review for possible

The review is prompted principally by Moody's concerns about the
company's thin liquidity position, as dictated by fairly
conservative but very tight covenants under its new bank credit
facilities; still high capital expenditure requirements to
continue upgrading its cable systems, the financing of which
remains uncertain; and ongoing subscriber erosion to competing
multichannel video service providers, which has been greater than
anticipated to date and has caused a fundamental deterioration in
the company's operating performance and resultant credit profile.
Prior to concluding its review, Moody's will re-assess the
prospect of improved subscriber economics for Northland's cable
systems, and the ability of its current assets to adequately
support its current and anticipated future capital structure.

Northland Cable Television is a cable multiple system operator
serving approximately 125,000 subscribers located in predominantly
rural markets. The company maintains its headquarters in Seattle,

NORTHLAND CRANBERRIES: Suffers $79.8MM Loss in Fourth Quarter
Northland Cranberries, Inc. (Nasdaq: CBRYA), manufacturer of
Northland brand 100% juice cranberry blends and Seneca brand fruit
juice products, reported a substantial net loss for the fourth
quarter of fiscal 2000 and the year ended August 31, 2000.

For the three-month period ended August 31, 2000, Northland
reported a net loss of $79.8 million, or $3.93 per share, on
revenues of $61.2 million. During the comparable quarter last
year, the company earned $3.6 million, or $0.18 per share, on
revenues of $76.6 million. For the 12-month period ended August
31, 2000, the company recorded a net loss of $105.0 million, or
$5.16 per share, on revenues of $266.2 million. This compares to
fiscal 1999 year-end earnings of $5.6 million, or $0.28 per share,
on revenues of $236.8 million.

Included in the net loss for the year was a $57.4 million lower of
cost or market inventory adjustment (of which $30.4 million was
recorded in the fourth quarter), required by generally accepted
accounting principles due to the recent rapid decline in per
barrel prices of cranberries, and an $8.3 million restructuring
charge associated with the previously announced closing of its
manufacturing facility in Bridgeton, New Jersey and the
termination of certain manufacturing and sales personnel. Other
factors contributing to the loss included continued aggressive
marketing and promotional spending in response to the continued
price discounting of cranberry products by major competitors;
charges for inventory obsolescence; and unanticipated difficulties
and expenses associated with the implementation of a new
management information system.

Northland also announced that, due to its net loss, it is
currently not in compliance with several covenants of its
revolving credit agreement and other long-term debt agreements. As
a result, Northland's long-term repayment obligations under its
revolving credit facility and long-term debt agreements have been
classified for accounting purposes as current liabilities.

John Swendrowski, Northland's Chairman and Chief Executive
Officer, stated, "Fiscal 2000 was a year of extraordinary hardship
for Northland, calling for many difficult decisions that have
impacted our employees, contract growers, suppliers, creditors,
and even the communities in which we operate.

"While over half of our loss for the year was associated with
various unusual charges, the balance of the loss can be generally
attributed to our high cost of cranberry compared to declining
market prices, increased manufacturing costs and continued high
levels of marketing spending in response to continued heavy trade
discounting by the industry leader. "Despite the magnitude of our
net loss for the year, I believe we have identified and begun to
address the major problems facing the company and that we have
initiated the necessary steps to return to profitability. The
write down of our cranberry inventory to estimated market value
should result in meaningful increases in our gross margins.

Closing our Bridgeton plant and moving production to our other
plants should help us generate significant reductions in our
manufacturing cost during the coming year. We have reorganized
every department within our company, which should help to
substantially reduce overhead. In addition, we are currently
attempting to restructure our bank debt to enable Northland to
move forward with its marketing plan for fiscal 2001. That plan
includes aggressive promotion of our reformulated Northland 100%
juice cranberry blends, which now contain 27% cranberry juice
content across the entire product line. We believe our "27%
Solution" campaign, which highlights the documented health
benefits of cranberries, will establish a significant point of
difference in the minds of consumers and should result in
increased market share," Swendrowski said.

Northland is a vertically integrated grower, handler, processor
and marketer of cranberries and value-added cranberry products.
The company processes and sells Northland brand 100% juice
cranberry blends, Seneca brand juice products, Northland brand
fresh cranberries and other cranberry products through retail
supermarkets and other distribution channels. Northland also sells
cranberry and other fruit concentrates to industrial customers who
manufacture juice products. With 24 growing properties in
Wisconsin and Massachusetts, Northland is the world's largest
cranberry grower. It is the only publicly-owned, regularly-traded
cranberry company in the United States, with shares traded on the
Nasdaq Stock Market under the listing symbol CBRYA.

OPTIMA HEALTH: S&P Affirms HMO's Bpi Financial Strength Rating
Standard & Poor's has affirmed its single-'Bpi' financial strength
rating on Optima Health Plan.

The rating reflects the HMO's very weak risk-based capitalization
and extremely weak earnings, offset by good liquidity and implicit
support from its owner.

This nonprofit, nonstock corporation was incorporated in 1984 in
Virginia. Sentara HealthCare and Maryview Hospital are its sole
corporate members.

Major Rating Factors:

   -- Risk-based capitalization is very weak, as indicated by a
       Standard & Poor's capital ratio of 11.3% at year-end 1999.
       Total statutory capital at year-end 1999 was $12.1 million,
       of which $9.8 million is in surplus notes from Sentara
       HealthCare and Maryview Hospital.

   -- Operating performance has been weak, with a net loss of
       about $708,000 in 1999.

   -- Liquidity is good, with a Standard & Poor's liquidity ratio
       of 120.8%. Enrollment growth is very strong, averaging
       16.4% over the past three years.

OWENS CORNING: Engages Arthur Andersen as Auditors
Owens Corning asks Judge Walrath for judicial authority to employ
Arthur Andersen LLP, through their Toledo, Ohio office, as
auditors and tax, accounting, and financial advisors for the
Chapter 11 estates in bankruptcy. The firm is to assist the
Debtors with substantial and continuing auditing, tax, accounting
and financial advisory matters required by the Debtors' ongoing
business and operations. Specifically, Arthur Andersen is to
perform these duties:

   (a) Recurring audit work related to the expression of an
opinion on the consolidated financial statements of the Debtors
for the year ended December 31, 2000, and recurring limited review
work related to the quarterly financial information to be included
in the Debtor's quarterly reports filed with the Securities and
Exchange Commission;

   (b) Audits of the Debtor's various domestic employee benefit
plans for the year ended December 31, 2000;

   (c) Advising the Debtors with respect to any public financial
reporting requirements under the applicable securities laws;

   (d) Rendering tax consultative services;

   (e) Rendering accounting assistance in connection with reports
required by the Bankruptcy Court;

   (f) Reviewing cash or other projections and submissions to the
Court of reports and statements of receipts, disbursements, and

   (g) Assisting the Debtors with the preparation of business

   (h) Assisting with the preparation for the Debtors'
negotiations with lending institutions and creditors;

   (i) Assisting Debtors' legal counsel with the analysis and
revision of the Debtors' plan or plans of reorganization;

   (j) Consulting with the Debtors' management and legal counsel
in connection with other business matters relating to the
activities of the Debtors;

   (k) Reviewing the Debtors' liquidation analysis;

   (l) Providing expert testimony as required;

   (m) Working with accountants and other financial consultants
for committees and other creditor groups;

   (n) Assisting the Debtors with the preparation of the Schedules
of Assets and Liabilities and the Statements of Financial Affairs;

   (o) Assisting with analysis of sales of various assets of the
Debtors, if any; and

   (p) Assisting with such other matters as Debtors' management or
legal counsel and Arthur Anderson may agree from time to time.

Arthur Andersen will be requesting approval of compensation for
services rendered, except audit services, on an hourly basis at
the firm's customary rates. These customary rates are:

        Partners/Principals         $ 475-575
        Managers/Directors          $ 340-525
        Seniors/Associates          $ 175-300
        Staff/Analysts               $ 90-175

These rates are subject to revision during the year in the normal
course of business for Arthur Andersen. Additionally, certain
partners and consultants, primarily specialized tax and accounting
professionals, have rates in excess of $575 per hour; however, the
firm does not anticipate that these persons will spend substantial
time on this engagement.

The Debtors and Arthur Andersen have agreed, subject to judicial
approval, that Arthur Andersen will provide audit services for the
audit and quarterly limited reviews for the year 2000 for
$2,075,000, plus expenses, which the firm states is a reduction
from its normal billing rates. Of this amount, $938,650 has been
paid to date for services rendered prior to the commencement of
the Chapter 11 cases.

On October 4, 2000, Arthur Andersen was paid a retainer of
$350,000 for post-petition audit services to be applied to any
final allowance for compensation for those services; however,
Arthur Andersen will also be permitted to offset from the $350,000
retainer any post-petition fees and expenses owed by the Debtors.

Prior to commencement of the case, and in some instances on an on-
going basis, Arthur Andersen performs auditing or other accounting
services to certain of the non-debtor affiliates of Owens Corning,
and for certain unrelated matters for creditors and indenture
trustees, including Arab Bank, Bank of America, Bank of New York,
Bank of Tokyo-Mitsubishi, Ltd., Citibank, and others, and for
certain equity security holders of Owens Corning holding 5% or
more of Owens Corning common stock, including BZW Barclays Global
Investors, Fleet Investment Advisors, FMR Corporation, and
others. Arthur Andersen has also provided professional tax
services in unrelated matters to certain members of the Debtors'
senior management, including Domenico Cecere and Steven J.
Strobel, and for the Debtors' attorneys, Skadden, Arps, Saul
Ewing, and Bingham Dana. Arthur Anderson also had a past
relationship with Lazard Freres & Co., who has been proposed as
investment bankers for the Debtors; however, such relationship
was terminated on December 31, 1999. Thomas J. Allison, a partner
of Arthur Anderson, also serves as Trustee of the Forty-Eight
Insulations Qualified Settlement Trust, which is responsible for
the settlement of asbestos-related personal injury claims, and
which is likely to have handled claims of many of the same
individuals who have or will pursue personal injury claims against
the Debtors. In addition, Barclays Bank and Credit Suisse First
Boston and their affiliates, some of whom are creditors
of the Debtors, provide investment services to Professional
Services Insurance Company Limited, a Bermuda insurer, the
majority of whose shares are owned by various Arthur Andersen
firms around the world.(Owens-Corning Bankruptcy News, Issue No.
5; Bankruptcy Creditors' Service, Inc., 609/392-0900)

PACIFICARE HEALTH: Milberg Weiss Files Shareholders' Lawsuit
Milberg Weiss announced that a class action has been commenced in
the United States District Court for the Central District of
California on behalf of those who purchased or otherwise acquired
PacifiCare Health Systems, Inc. (NASDAQ:PHSY) securities during
the period between October 27, 1999 and October 10, 2000.

The complaint charges PacifiCare and certain of its officers,
directors and one of its largest shareholders with violations of
the Securities Exchange Act of 1934. The complaint alleges that
PacifiCare's interim results were false and materially misstated
due to its failure to properly record medical expenses,
particularly its under-accrual of incurred but not reported costs
("IBNR"). In order to inflate the price of PacifiCare's stock,
defendants caused the Company to falsely report its results for Q3
1999, Q4 1999, Q1 2000 and Q2 2000 by misstating its results
through its deliberate under-accrual of medical expenses and its
reserves for doubtful accounts receivable, all of which resulted
in artificially inflating PacifiCare's earnings per share ("EPS").
The complaint further alleges that defendants misrepresented that
the revenues PacifiCare was reporting were consistent with
Generally Accepted Accounting Principles ("GAAP"), which, together
with defendants' false representations that PacifiCare would post
Q3 EPS of $1.90, operated to artificially inflate the price of
PacifiCare stock to a Class Period high of $72-5/16 on June 16,
2000. While PacifiCare's shares were inflated, defendants sold
approximately $50,000,000 worth of PacifiCare stock. On October
10, 2000, PacifiCare revealed that it was in fact suffering a huge
decline in revenues, was not posting EPS growth as earlier
represented, and contrary to defendants' repeated assurances,
PacifiCare was forced to reveal the problems it had been
experiencing during the Class Period in attempting to grow its
business. This announcement caused its stock price to drop to as
low as $14-5/8 (or over $18 per share) on record volume of 5.6
million shares on October 11, 2000, causing tens of millions of
dollars in damages to members of the Class.

Contact William Lerach or Darren Robbins of Milberg Weiss at
800/449-4900 or via e-mail at or visit further details.   

PILLOWTEX: Employs Morris Nichols as Local Counsel
Pillowtex Corporation and its chapter 11 debtor-affiliates sought
and obtained the Court's authority to employ the Wilmington-based
law firm of Morris, Nichols, Arsht & Tunnell as their local
counsel in their chapter 11 cases retroactively to the Petition
Dates. In favor of the retroactive granting of this Application,
Morris Nichols has cited the complexity, intense activity, and
speed that have characterized these cases and which have required
that the professionals focus their immediate attention on time-
sensitive matters. Since only a short time has elapsed since the
Petition Dates, Morris Nichols states that no creditor or other
party in interest will be prejudiced by the retroactive approval
of their employment by the Debtors.

Specifically, Morris Nichols will:

   (a) perform all necessary services as the Debtors' counsel,
including, without limitation, providing the Debtors with advice
concerning their rights and duties as debtors in possession,
representing the Debtors, and preparing all necessary documents,
motions, applications, answers, orders, reports and papers in
connection with the administration of these chapter 11 cases on
behalf of the Debtors;

   (b) take all necessary actions to protect and preserve the
Debtors' estates during the pendency of their chapter 11 cases,
including the prosecution of actions by the Debtors, the defense
of any actions commenced against the Debtors, negotiations
concerning all litigation in which the Debtors are involved and
objecting to claims filed against the estates;

   (c) represent the Debtors at hearings, meetings, conferences,
etc. on matters pertaining to the affairs of the Debtors as
debtors in possession; and

   (d) perform all other necessary legal services.

The Debtors will pay Morris Nichols its customary hourly rates.
The attorneys and paralegals who are likely to play an active role
in this engagement will be billed at their current hourly rates:

      Partners                  $320-440
      Associates                $150-290
      Paraprofessionals         $100-125
      File Clerks                   $ 50

William H. Sudell, Jr., Esq., discloses that Morris Nichols
received approximately $100,000 from the Debtors for legal
services rendered and expenses incurred (including filing fees) in
contemplation of the preparation, commencement and prosecution of
these cases. Any portion of these amounts received by Morris,
Nichols that has not yet been applied to prepetition fees and
expenses will be applied when such amounts are identified, and
should any amounts remain after such application, the remainder
will be held as a retainer for and applied against postpetition
fees and expenses.

In this connection, Morris Nichols also filed a Motion requesting
the admittance of certain attorneys for the Debtors pro hac vice.
Specifically, Morris Nichols has requested that the following
attorneys at the offices indicated be admitted pro hac vice:

      David G. Heiman         Cleveland, Ohio
      Gregory M. Gordon       Dallas, Texas
      Brad A. Baldwin         Atlanta, Georgia
      Daniel P. Winikka       Dallas, Texas
      Joseph M. Witalec       Columbus, Ohio
      Brett J. Berlin         Atlanta, Georgia

(Pillowtex Bankruptcy News, Issue No. 2; Bankruptcy Creditors'
Service, Inc., 609/392-0900)

PSINET, INC: Files Motions to Dismiss Class Action Complaints
PSINet Inc. (Nasdaq:PSIX), announced that it has filed motions to
dismiss 15 purported class action complaints alleging violations
of securities laws by the company and certain of its senior
officers and directors that had been filed since November 3, 2000.

PSINet decided to promptly move for dismissal on the ground that
none of the complaints satisfy any of the fundamental requirements
to state a claim for violation of the securities laws. In its
motions, PSINet stated that all of the complaints fall within the
category of claims that Congress clearly prohibited under the
Private Securities Litigation Reform Act of 1995 and therefore
should be dismissed.

The rapidity with which the complaints were filed, along with the
repetition of obvious typographical and factual errors,
demonstrates that plaintiffs and their counsel made their claims
without engaging in reasonable investigation or factual inquiry
before asserting claims that are simply untrue.

"We stated when these complaints were filed that the company
intended to defend itself and its officers and directors
vigorously against these claims, and we mean it," stated PSINet
Chairman and Chief Executive Officer William L. Schrader. "We are
confident in our expectation that the company and its named
officers and directors will demonstrate that the claims made by
various plaintiffs' lawyers have absolutely no merit."

Headquartered in Ashburn, Va., PSINet is an Internet Super Carrier
offering global e-commerce infrastructure, end-to-end IT solutions
and a full suite of retail and wholesale Internet services through
wholly-owned PSINet subsidiaries. Services are provided on PSINet-
owned and operated fiber, satellite, web hosting and switching
facilities, providing direct access in more than 900 metropolitan
areas in 28 countries on five continents. PSINet information can
be obtained by e-mail at, by accessing the web site
at, or by calling in the U.S. (800) 799-0676.

RELIANCE GROUP: Fails to Make Payments Due on November 15
Reliance Group Holdings (NYSE:REL) announced that it has not made
the $291.7 million payment on its 9 percent Senior Notes that
matured on November 15, or the interest payment on the 9 3/4
percent Senior Subordinated Debentures due November 15.

The company said that it continues to discuss a restructuring with
its bondholders, bank lenders, and insurance regulators. As
previously announced, the company did not pay the bank credit
facility that matured on November 10, 2000.

"The bank group continues to be in discussions with the company on
the terms of a restructuring that is in the best interests of all
of its stakeholders," said a spokesperson for The Chase Manhattan
Bank, administrative agent for the bank lenders.

"Along with other advisors to the Reliance bondholders' committee,
we have been in discussions with the Company, its bank lenders and
the insurance regulators in trying to reach a consensual
restructuring of Reliance and we are hopeful that a deal will be
reached in the near term," said a spokesperson for Wasserstein
Perella & Co., Inc., financial advisor to the ad hoc committee of
holders of the company's Senior Notes and Senior Subordinated

"We appreciate the continued support of our bondholders, bank
lenders and the insurance regulators. In the meantime we are
moving forward with the run-off of our operations," said George
Baker, Reliance Group Holdings Chief Executive Officer.

RESOURCEPHOENIX.COM: Inks Asset Sale Agreement with Phoenix
----------------------------------------------------------- (Nasdaq:RPCX), announced that it has agreed to
sell substantially all of its assets to Phoenix American
Incorporated (PAI), an RPC affiliate, as part of an orderly
winding down of the company's operations. In this regard, PAI will
assume the company's obligations to its secured creditors. No
recovery to general unsecured creditors or shareholders is
anticipated at this time. In addition, the company announced the
layoff of approximately 80 of its 173 employees. The remaining
employees will be transitioned to the purchaser of the assets.
Gus Constantin, chairman, president and chief executive officer
stated, "I want to assure our customers that we will be working
with them to try to facilitate a smooth transition."

The announcement came after a lengthy and exhaustive effort to
both raise capital, dating back to early spring, or more recently,
to sell the company outright to a non affiliated entity. The
company contacted numerous financial and strategic prospects. The
company worked to maximize business efficiencies and eliminate as
many operating expenses as was prudent to conserve cash and to
provide more time to examine all options. In the end, however, the
result of these efforts was insufficient as no party was prepared
to provide capital or acquire the company.

SCB COMPUTER: Nasdaq Reverses Decision on Stock Delisting
SCB Computer Technology, Inc. (OTCBB:SCBI) announced that the
Nasdaq Listing and Hearing Review Council has reversed the
decision of the Nasdaq Listing Qualification Panel to delist SCB's
common stock from the Nasdaq National Market. The Nasdaq Listing
Council has remanded the matter to the Nasdaq staff to determine
whether SCB's common stock may again be listed on the Nasdaq
National Market.

There have been several previous developments relating to SCB's
listing on Nasdaq. On April 14, 2000, Nasdaq suspended the trading
in SCB's common stock on the Nasdaq National Market following
SCB's announcement of its intention to restate certain prior
financial statements. On May 26, 2000, the Nasdaq staff notified
SCB of its initial determination to delist SCB's common stock. On
June 1, 2000, SCB requested that the Nasdaq Panel review the
determination of the Nasdaq staff, which stayed the delisting
pending a decision by the Nasdaq Panel. On August 17, 2000, the
Nasdaq Panel issued its decision to delist SCB's common stock. The
delisting was effective as of August 18, 2000. On August 30, 2000,
SCB requested that the Nasdaq Listing Council review the decision
of the Nasdaq Panel. Finally, on November 22, 2000, the Nasdaq
Listing Council reversed the decision of the Nasdaq Panel and
remanded the matter to the Nasdaq staff.

In its decision, the Nasdaq Listing Council found that SCB has
taken several meaningful steps to address the public interest
concern cited by the Nasdaq staff and the Nasdaq Panel in their
delisting decisions. The Nasdaq Listing Council noted, however,
that SCB's common stock does not meet the minimum bid price of
$1.00 per share required by Nasdaq.  The Nasdaq Listing Council
granted SCB a 90-day period in which to achieve a minimum $1.00
bid price and to demonstrate its compliance with all other
continued listing requirements of the Nasdaq National Market. The
Nasdaq Listing Council instructed the Nasdaq staff to conduct a
full initial inclusion review of SCB and to include SCB's common
stock on the Nasdaq National Market if SCB is able to demonstrate
compliance with all applicable listing requirements and if there
are no adverse developments justifying the denial of listing.

To facilitate compliance with Nasdaq's minimum bid price
requirement, SCB intends to effect a reverse split of its common
stock. The reverse stock split would result in a decrease in the
number of outstanding shares of SCB's common stock. SCB believes
that the reverse stock split also would likely result in the bid
price of its common stock increasing above the minimum $1.00 bid
price requirement imposed by Nasdaq. The reverse stock split would
be accomplished through an amendment to the capital stock
provisions of SCB's charter. To become effective, the charter
amendment must be recommended by SCB's board of directors and
approved by its shareholders. SCB intends to proceed with the
reverse stock split in the very near future.

SCB Computer Technology, Inc., is a leading provider of
information technology management and technical services to
Fortune 1000 companies, state and local governments, and other
large organizations.

SERVICE MERCHANDISE: Leasing & Subleasing 6 Stores to Michaels
Pursuant to 11 U.S.C. section 363 and Rule 6004 of the Bankruptcy
Rules, the Debtors move the Court for entry of six orders,
authorizing them to enter into agreements with Michaels Stores,
Inc. to lease and to sublease to Michaels certain of the Debtors'
fee-owned and leased stores, as part of their Subleasing Program:

                       Total    Sq. Ft to  Current     Proposed
Store Location         Sq. Ft.  (sub)lease Annual Cost Annual Rent
----- --------         -------  ---------- ----------- -----------
57    Cincinnati, OH   50,000     25,841     434,931     197,684
91    Nashua, NH       50,000     24,300     670,238     218,700
260   Lakeland, FL     50,000     23,001     416,274     161,007
360   Richmond, VA     51,600     26,400     111,810     250,800
434   White Marsh, MD  60,200     23,095      84,158     254,045
436   Sanford, FL      50,000     24,620     462,500     221,580

As the White March Store is fee-owned by the Debtors, the Michaels
transaction will involve leasing of this store. The Richmond Store
is owned by SMC-SPE-l, Inc., and leased to Homeowners Warehouse,
Inc., pursuant to requirements of the Debtors major secured lender
relating to the Richmond Store. The Debtors advise that they
intend to lease Richmond Store to Michaels by way of a sublease,
but in all material respects the document mirrors the Lease for
the White Marsh Property.

The Debtors also request that the Court make findings that:

      * the applicable lease, mortgage and related documents as to
         which the Debtors are bound do not prohibit the
         subleasing of the Premises to Target, including, but not
         limited to, any necessary renovation to the Premises,
         installation of typical Michaels signage and the tenant's
         initial work;

      * the interests of the parties to such documents will be
         adequately protected as provided in the Order or as may
         otherwise be agreed to between the Debtors and such other

      * to the extent that any documents exist, to which the
         Debtors are not a party, that purport to prevent the
         proposed subleasing, such documents are not binding on
         the Debtors and, therefore, cannot prevent the
         consummation of the proposed transaction;

      * it would be unreasonable for a lessor under any Primary
         Lease or a lender holding a mortgage against any of the
         Properties to object or withhold its consent to the
         proposed Michaels Lease related to such Property;
         and approve

      * the offer of adequate protection of other parties'
         interests in such properties in connection with the
         Debtors' proposed use of this property, if necessary.

Michaels' intended use of the Properties is for the storage,
service and retail sale of arts, crafts and related supplies;
party, wedding and seasonal decorations; picture frames and
framing services and supplies; wearable art and supplies; and
other such merchandise as is typically found in other stores
operated by Michaels, or any other lawful retail use subject
to the restrictions, if any, contained in the Recorded Documents,
Michaels will not use these stores for the sale of jewelry or
"home goods."

The Debtors will renovate the retained portion of the Properties
to conform to the initiatives of the Debtors' 2000 Business Plan.
In addition, Michaels will renovate the Properties to be suitable
for a typical Michaels arts and crafts location.

With respect to the Sublease Transactions for stores other than
for White Marsh, Michaels will not sell, assign, mortgage, pledge,
franchise or transfer any of the Subleases or estate or sublet the
Properties or permit any licensee or concessionaire without the
prior written consent of the Debtors, provided, however, Michaels
may, without the consent of the Debtors, assign or sublet to
certain related entities, or to a retail entity which meets with
certain particular conditions and obligations, and in such event,
Michaels will remain liable for the obligations of a tenant. The
Debtors are obligated to obtain recognition and attornment
agreements from the Primary Landlords. Failure to do so gives rise
to termination rights.

For the Lease Transactions with respect to the Richmond Store and
the White Marsh Store that the Debtors own in fee simple, Michaels
will not sell, assign, mortgage, pledge, franchise or transfer the
Leases or estate or interest or sublet the Properties or any parts
thereof or permit any licensee or concessionaire therein without
the prior written consent of the Debtors, provided that Michaels
may without the consent of the Debtors, assign or sublet to
certain related entities, or to a retail entity which meets with
certain particular conditions and obligations, and in such event,
Michaels will remain liable for the obligations of a tenant. The
Debtors shall deliver non-disturbance and attornment agreements
from lenders or mortgagees that appear of record.

               The Debtors' Description of Michaels

Michaels is a national retailer dedicated to serving the arts,
crafts and decorative items marketplace. Michaels stores offer a
selection of competitively priced items, including general crafts,
home decor items, picture framing materials and services, art and
hobby supplies, party supplies, silk and dried flowers, wearable
art, and seasonal and holiday merchandise for the hobbyist and do-
it-yourself home decorator.

Michaels operates approximately 625 retail stores throughout the
United States, Canada and Puerto Rico. As of January 29, 2000,
Michaels had net annual sales of approximately $1.9 billion and
total assets of approximately $1.1 billion. Michaels has proposed
to use the Michaels Leased Premises as arts and crafts stores.

The Debtors submit that, based upon their review of the Primary
Lease, mortgages and related documents as to which they are bound,
nothing contained in such documents would prevent the use of the
Premises for the purposes contemplated by Michaels. As to
alterations and signage the Michaels Leases provide that any
alterations or signage must conform to requirements of local law
and any other Recorded Documents, and subject to the Debtors'
consent. Any refusal of a primary landlord to consent to the
proposed signage is unreasonable per se because the Debtors have
provided the primary landlords with adequate protection.

The Debtors tell Judge Paine that the quality of Michaels as a
tenant or subtenant cannot be doubted. They are convinced that the
proposed transactions will result in substantial future income and
represents an exercise of sound business judgment. (Service
Merchandise Bankruptcy News, Issue No. 14; Bankruptcy Creditors'
Service, Inc., 609/392-0900)

THERMADYNE MFG: Moody's Junks 9-7/8% Senior Subordinated Notes
Moody's Investors Service downgraded Thermadyne Mfg. LLC $430
million of secured credit facilities to B3 from B1, downgraded its
$207 million of 9 7/8% senior subordinated notes, due 2008, to
Caa2 from B3, and downgraded Thermadyne Holdings $126 million
(accreted value) of 12 1/2% senior discount debentures, due 2008
to Caa3 from Caa1. The senior implied rating is B3. The unsecured
issuer rating is Caa1. The outlook is negative.

The ratings reflect the company's excessive and increasing
leverage relative to its lackluster operating performance. Total
debt represents approximately 1.4x sales for the latest 12 months
("LTM") ended 9/30/00 and 2.3x total assets. Debt continues to
increase as a result of non-cash paying debt instruments whose
principal balances are accreting. Despite the company's strong
operating margins, Thermadyne's leverage growth is outpacing its
operating performance as a result of weaker-than-projected sales
due to general weakness in the U.S. and in most international
industrial economies. Furthermore, the balance sheet remains
extremely weak with $635 million of negative book equity, a
decline of $100 million since 12/31/99.

The negative outlook reflects expectations for continued softness
in the global welding industry. Should Thermadyne's operating
performance fail to improve, servicing its enormous debt
obligations could prove difficult, in Moody's opinion. In the
current weak industrial economic environment, the subordinated
debt instruments would likely suffer principal impairment. It is
also unclear what further sponsorship the company can expect from
DLJ Merchant Banking (which invested $140 million of equity in the
company when it bought it in 1998).

Thermadyne's strengths remain its leading market positions across
most product areas, strong brand name recognition, and stable
sales from consummable products. In addition, given the existence
structurally subordinated debt (in the form of $207 million of
senior subordinated notes, $126 million - accreted value - of
senior discount notes, and $65 million of other junior
subordinated debt, Moody's estimates that the $315 million of
senior secured bank debt and $21 million of capital leases would
likely be covered if the company were sold at a modest multiple of
LTM EBITDA. Under a liquidation scenario, however, tangible assets
of about $288 million would be insufficient to cover it.

For the 3 months ended 9/30/00 ("Q3-00"), revenues decreased by
2.3% to $124.9 million, due to general weakness in the U.S.
industrial economy. International sales also declined, depite
strong growth in Latin America and Canada, which was offset by
declines in Europe, Australia and Asia. EBIT, net of nonrecurring
charges of $10.8 million and one-time nonrecurring amortization
expense of $23.4 million, was $19 million in Q3-00 versus $17.1
million in Q3-99. Accelerated amortization expense resulted from
the write-down of certain of the company's Australian assets. The
company also incurred special charges (nonrecurring) of $10.8
million, related to relocation of production facilities and
changes in senior management. EBITA, net of nonrecurring expenses,
was $20.1 million in Q3-00 versus $18.6 million in Q3-99, covering
interest expense (cash and non-cash) of $20.1 million and $18.2
million, by 1x, respectively. Increases in gross profit and
margins, due to cost containment efforts, were offset by increased
operating expenses due to higher marketing costs. Adjusted EBITDA
of $24.1 million in Q3-00 provided 1.2x coverage versus adjusted
EBITDA of $22.8 million in Q3-99, which provided 1.2x coverage.

For the 9 months ended 9/30/00, revenues were $393.2 million
compared to $391.5 million in the comparable 1999 period. A slight
increase in domestic sales was offset by lower international
sales. Special charges were $29.2 million, for relocation and
management expenses mentioned above, as well as $7.7 million
related to the decision to exit a portion of the gas management
business. EBIT, net of those nonrecurring charges, and one-time
amortization expense of $23.4 million, was $61.1 million, or 15.5%
of sales, versus $57.3 million, or 14.6% of sales for the
comparable 1999 period. EBITA, net of nonrecurring charges, was
$64.8 million, covering interest expense (cash and non-cash) of
$60.2 million by 1.1x, compared to EBITA of $63.6 million in the
1999 comparable period, which covered interest expense (cash and
non-cash) of $53.5 million by 1.2x. Adjusted EBITDA of $77.4
million in the nine month 2000 period provided 1.3x coverage
versus adjusted EBITDA of $77.3 million in the 1999 comparable
period, which covered interest by 1.4x.

For LTM ended 9/30/00, revenues were flat at $522.8 million
compared to $521.1 million for the year ended 12/31/99. EBIT, net
of non-recurring charges and one-time amortization expense, was
$75.7 million versus $71.9 million for the 1999 year. EBITA, net
of nonrecurring charges, was $81 million, which covered interest
expense (cash and non-cash) of $79.1 million by 1x. Adjusted
EBITDA of $98.7 million for LTM 9/30/00 provided 1.2x coverage
versus EBITDA of $98.6 million for the year ended 12/31/99, which
covered interest by 1.4x.

Total debt at 9/30/00 was $735 million, or 9.2x LTM EBITA, net of
recurring charges. (7.6x LTM EBITDA). Book equity was negative
($635 million) compared to negative ($534 million) at 12/31/99.

Thermadyne Mfg. LLC, located in St. Louis, Missouri, manufactures
a broad range of cutting and welding products and accessories
under the "Victor", "Tweco", "Arcair", "Thermal Dynamics", and
"Cigweld" brand names, among others. End-users are engaged in the
aerospace, automotive, construction, metal fabrication, mining,
mill and foundry, petroleum and shipbuilding industries. For the
latest 12 months ended 9/30/00, revenues, adjusted EBITA and
adjusted EBITDA were $522.8 million, $81 milion, and $98.7
million, respectively.

TOP AIR: Bank Lender Prefers Liquidation to Reorganization
Top Air Manufacturing, Inc. (Amex: TPC) announced that it planned
to liquidate the assets of the Company, citing the recent
rejection by its bank lender of a proposed plan to restructure as
necessitating this action.

The Company stated that a group of potential investors, including
certain members of its Board, had submitted a proposal to the
Company's bank lender that contemplated, among other things, the
infusion by the investor group of a significant amount of cash
into the Company, conditioned upon and in connection with a
proposed restructuring of the Company that would have included the
write-down by the bank lender of a portion of the current
indebtedness of the Company to the bank lender. The Bank advised
the Company that the proposed restructure plan was not acceptable
to it and of its insistence on the liquidation of the Company.

The Top Air Board concluded that the Company had explored and
exhausted all known possibilities of restructuring its
capitalization and long-term debt, and, given the position of its
bank lender, the liquidation of the assets of the Company
represented the best means of preserving the assets of the Company
for the benefit of its creditors. It is not expected that any of
the liquidation proceeds would be available for distribution to
the shareholders of the Company. The Company intends to continue
to work with its bank lender to implement an orderly plan of
liquidation being developed by the Company and the Bank, which
could include the sale of all or substantially all of the assets
of the Company to a third party purchaser. The Company has been
advised that a third party has made such a proposal to the Bank.

Steven R. Lind, President and Chief Executive Officer of the
Company stated, "I was surprised and disappointed by the Bank's
rejection of the investment group's restructure proposal, which
was developed in consultation with consultants retained at the
request of the Bank, particularly in view of the Company's
improved operating performance over the past several months
leading into what has historically been the most productive period
for the Company to generate revenue and profitability. We are
hopeful that the Company's business can continue to be carried on
by a third party purchaser."

Top Air Manufacturing, Inc. is a leading manufacturer of high
quality agricultural equipment. The company trades on the American
Stock Exchange under the trading symbol TPC.

UNAPIX ENTERTAINMENT: General Electric Extends $40MM DIP Pact
Unapix Entertainment Inc., which recently filed for Chapter 11 in
the U.S. Bankruptcy Court for the Southern District of New York,
obtained a revolving debtor-in-possession credit facility of $40
million from primary lender, General Electric Capital Corp.  The
film, television and video distribution firm intends to hire Salem
Partners LLC to seek alternatives for the troubled company.  In
its chapter 11 petition, Unapix reported assets of $79.7 million
and debts of $45.7 million.

WHEELING PITTSBURGH: Judge Bodoh Enters Vendor Comfort Order
Appearing through Michael E. Wiles and Lorna G. Schofield of the
firm of Debevoise & Plimpton of New York, and James M. Lawniczak
and Schott N. Opincar of the Cleveland, Ohio, firm of Calfee,
Halter & Griswold LLP, Wheeling Pittsburgh and its debtor-
affiliates asked for, and Judge Bodoh entered, an order confirming
the administrative expense priority status of the Debtors'
undisputed obligations to suppliers arising from post-petition
delivery of goods and services, and authorizing
the Debtors to pay these expenses in the ordinary course of their

The principal assets of the Debtor Pittsburgh-Canfield Corporation
is in Canfield, Ohio. PCC is a wholly owned subsidiary of
Wheeling-Pittsburgh Corporation, the principal debtor in this
case. WPC's principal operating subsidiary is Wheeling-Pittsburgh
Steel Corporation, headquartered in Wheeling, West Virginia. All
of the remaining debtors are affiliates of PCC, WPC or WPSC.

WPSC is the ninth largest integrated steel manufacturer in the
United States. The Debtors, through the operating affiliates,
produce and sell a broad array of flat rolled steel products which
are sold to steel service centers, converters, processors, the
construction industry, and the container and appliance industries.

In the ordinary course of the Debtors' business, numerous
suppliers provide the Debtors with raw materials and supplies
necessary for the Debtors' operations. On the commencement of
these Chapter 11 cases, the Debtors had numerous pre-petition
purchase orders outstanding with numerous suppliers for various
categories of raw materials and supplies. The Debtors are
concerned that the suppliers may believe that shipments of raw
materials and supplies made after the Petition Date under a pre-
petition purchase order will render the vendor who makes such
shipment a general unsecured creditor of the Debtors' estates.
There is thus a real possibility that the suppliers will not ship
raw materials and supplies to the Debtors unless the Debtors issue
substitute purchase orders post-petition or obtain an Order of the
Court granting all obligations of the Debtors arising from
post-petition shipments an administrative expense priority status.

The Debtors, in order to obtain timely delivery of the raw
materials and supplies represented by the outstanding orders,
sought entry of an Order from Judge Bodoh confirming the priority
status of payment of these orders where the obligations were
undisputed by the Debtors and arose from shipments of raw
materials and supplies received and accepted by the Debtors
subsequent to the Petition Date but under pre-petition purchase

However, the Debtors did not make any such request with respect to
undisputed obligations if, under the explicit terms of the legal
documents governing the post-petition shipment, title to the raw
materials or supplies was explicitly transferred to the Debtors
prior to the Petition Date.

The Debtors, through their counsel, urged entry of the Order to
ensure the continuous supply of raw materials and supplies which
were characterized as vital to the Debtors' continuing operations
and integral to the Debtors' successful reorganization. Without
Judge Bodoh's Order, the Debtors could be required to expend
substantial time and resources to reissue the pre-petition and
outstanding purchase orders. The resulting disruption to the
continuous flow of raw materials and supplies to the Debtors would
impair the Debtors' ability to timely provide the products
purchased by their customers. The attorneys for the Debtors
suggested this would surely lower the Debtors' customers'
confidence at this critical juncture, and possibly cause customers
to fill their orders elsewhere, with the consequent derailment of
the Debtors' efforts to reorganize. (Wheeling-Pittsburgh
Bankruptcy News, Issue No. 2; Bankruptcy Creditors' Service, Inc.,

WICKES: Exchange Offer and Consent Solicitation Deadlines Near
Wickes (Vernon Hills, IL) has commenced a cash tender offer for
$100 million in outstanding principal amount on its 11.625% Senior
Subordinated Notes due 2003 for $605 per $1,000 principal amount
of Notes, plus accrued and unpaid interest. The Company is also
soliciting consents for the elimination of certain covenants in
the indenture relating to the Notes in exchange for consent
payments equal to $30 per $1,000 of principal. The tender offer
expires on December 20, 2000, while the consent solicitation
expires on December 12, 2000, F&D Reports notes in this week's
edition of a trade newsletter.

* BOOK REVIEW: Going for Broke: How Robert Campeau Bankrupted the
               Retail Industry, Jolted the Junk Bond Market, and
               Brought the Booming 80s to a Crashing Halt
Author: John Rothchild
Publisher: Beard Books
Softcover: 286 Pages
List Price: $34.95
Order a copy today from at

Review by Gail Owens Hoelscher

Robert Campeau, one of 14 children born to a French Canadian
mechanic and blacksmith, invested $5,000 in a modest house under
construction in Ottawa in 1949, doing most of the carpentry work
himself.  Foreseeing the post-war suburb boom, and virtually
creating the Ottawa skyline, he went on to build a successful,
sprawling $200 million real estate corporation.

Then, riding the tidal wave of leveraged buyouts of the late
1980s, he borrowed $11 billion from Wall Street to acquire Allied
Stores and Federated Department Stores, both successful and
relatively debt-free retail conglomerates, in hostile takeovers.  
Fortune magazine called the Federated buy "the biggest, looniest
deal ever."  Two years later, Allied, Federated, and Campeau
Corporation were plunged into Chapter 11 receivership.

Campeau was so many things: risk-taker extraordinaire, earnest,
eccentric, endearing, cocky, extravagant, persistent, impetuous,
commanding, frenetic, and capricous.  He shocked the conservative
Canadian business community with his brazenness, flamboyance and
quirky ways.  In 1980, he showed up at the home of the CEO of
Royal Trustco, Canada's largest trust company and real estate
brokerage, at breakfast time.  His English only passable, Campeau
told the astonished CEO that he was taking over Royal Trustco that
very day.  Campeau was summarily thrown out and the major business
players in Canada quickly got together and bought up all the
outstanding shares of Royal Trustco to thwart his plan.

Campeau was a total stranger to the U.S. investment banking world.  
His quest had begun with the intention of buying a U.S. bank or
S&L.  Reading about the hostile takeover of Macy's, however, he
abruptly ordered his Canadian financiers to look for a retail
company instead.  Once in contact with Wall Street, he bemused
them with his picturesque and baffling ways of doing business.

Blinded or dazzled by his eccentricities, enticed by the prospect
of colossal fees, and caught up in their times, investment bankers
assembled the funds needed for Campeau's adventure into retailing.  
He drastically overbid for both companies.  In the case of
Federated, Campeau paid a little over $8 billion for the company,
which had had a market value of $3 billion, and borrowed about $7
billion.  Allied was worth about $2 billion, but he paid more than
$4 billion.

Campeau never found the "synergy between real estate and retail"
he promised the shocked and angry management and employees of the
two companies.  Saddled with enormous debts, Campeau's complete
ignorance of the retail industry, his ridiculously high
expectations and broken promises, the companies went into a free-
fall. Casualties included upward of 10,000 employees laid off at
Federated and Allied alone, junk-bond investors, brokerages stuck
with bridge loans, other retailers forced to lower their prices as
Allied and Federated unloaded inventory, and creditors with claims
of over $8 billion.

The first line of Going for Broke reads "This is the story of a
marvelous financial calamity."  Read on and be amazed, amused, and

John Rothchild is a well-known journalist and writer.  He has
authored and co-authored eight books, including three co-authored
with Peter Lynch.


Bond pricing, appearing in each Monday's edition of the TCR, is
provided by DLS Capital Partners in Dallas, Texas.

A list of Meetings, Conferences and Seminars appears in each
Wednesday's edition of the TCR. Submissions about insolvency-
related conferences are encouraged. Send announcements to

Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals. All titles available
from -- go to
-- or through your local bookstore.

For copies of court documents filed in the District of Delaware,
please contact Vito at Parcels, Inc., at 302-658-9911. For
bankruptcy documents filed in cases pending outside the District
of Delaware, contact Ken Troubh at Nationwide Research &
Consulting at 207/791-2852.


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, Ronald
Ladia, and Grace Samson, Editors.

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

This material is copyrighted and any commercial use, resale or
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re-mailing and photocopying) is strictly prohibited without prior
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is obtained from sources believed to be reliable, but is not

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                * * * End of Transmission * * *