TCR_Public/001222.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 22, 2000, Vol. 4, No. 250

                           Headlines

ALAMOSA PCS: Moody's Confirms 12.875% Senior Notes at Caa1
APB ONLINE: A Month Behind on Payroll
ARMSTRONG WORLD: Look for Schedules & Statements on February 18
CENTRAL BENEFITS: S&P Lowers Financial Strength Rating to Bpi
CONTIFINANCIAL CORP: N.Y. Court Confirms Plan of Reorganization

CUMMINS ENGINE: S&P Places Ratings on CreditWatch Negative
GE CAPITAL: Fitch Downgrades Ratings on Home Equity Certificates
GENESIS/MULTICARE: Agrees to Lift Stay for Insured Claim
GENESIS HEALTH: Seeks Further Extension of Exclusive Periods
HARNISCHFEGER: U.S. Trustee Objects to Disclosure Statement

HARNISCHFEGER: Files Second Amended Plan of Reorganization
HEILIG-MEYERS: Aaron Rents Acquires 27 Leases in Auction
ICG COMMUNICATIONS: Inks $350MM DIP Financing Pact with Chase
ICG COMMUNICATIONS: Nasdaq Announces Decision to Delist Shares
INTERSTATE BAKERIES: Moody's Places Baa3 Ratings Under Review

MARINER POST: Selling Brazos' Geriatric Center for $2,800,000
PACIFIC GATEWAY: President & CEO and COO Tender Resignations
PATRICK INVESTMENTS: Case Summary & 20 Largest Unsecured Creditors
PNV, INC: Communications Servicer Seeks Chapter 11 in Florida
PNV, INC: Nasdaq Halts Trading & Requests More Information

PSINET INC: Moody's Lowers Senior Unsecured Debt Rating to Caa1
RELIANCE GROUP: Urges Noteholders to Ignore Ichan Tender Offer
SCOUR INC: CenterSpan Acquires Assets for $9 Mil in Cash & Stock
VENCOR, INC: Signs Stipulation with Lenox, Ventas and the Clarkes
VENCOR INC: Ventas Lenders Extend Vencor Plan Deadline to Mar. 31

WEST BUILDING: Seeks Chapter 11 Protection in Northern Georgia
WHEELING-PITTSBURGH: Hires Calfee Halter as Local Counsel
WINN-DIXIE: Moody's Places Ratings on Review for Downgrade

* BOOK REVIEW: Transcontinental Railway Strategy, 1869-1893: A
               Study of Businessmen

                           *********

ALAMOSA PCS: Moody's Confirms 12.875% Senior Notes at Caa1
----------------------------------------------------------
Moody's Investors Service assigned B2 rating to Alamosa LLC for
its $305 million in Senior Secured Credit Facilities.  Moody's
also confirmed the Caa1 rating on 12.875% Senior Notes due 2010 of
Alamosa PCS Holdings, Inc. as well as the company's senior implied
rating of B2.  The ratings outlook is stable.

The ratings reflect the early stage of the company's PCS
operations, the highly competitive nature of the wireless
communications industry, the expectation of negative cash flows
for at least the next year, and the addition of 4 million
predominantly unbuilt POPs. The ratings also reflect the strengths
and weaknesses of the issuer's relationship to and agreements with
Sprint PCS, as well as the success Alamosa has so far enjoyed in
building out its network and attracting subscribers. The rating on
the senior discount notes is notched down from the senior implied
rating due to the note's structural subordination to borrowings
under the $305 million secured credit facility.

This new credit facility consolidates two separate credit
facilities: the $175 million credit facility available to a
subsidiary of Alamosa PCS Holdings, Inc. and an anticipated $200
million standalone credit facility that was to have financed the
acquisition of Roberts Wireless and Washington Oregon Wireless
(WOW), two small Sprint PCS affiliates. When this transaction was
announced in July, Alamosa has planned to inject capital into
Roberts and WOW using funds from Alamosa PCS Holdings, and then
finance the rest of the cash requirements of this entity on a
standalone basis. Instead, the company will more efficiently
finance the Roberts and WOW properties together with its original
markets with a single credit facility.

The Roberts and WOW properties are less mature than the original
Alamosa markets, and thus their addition to the Alamosa asset base
dilutes the credit strength of Alamosa PCS Holdings as Alamosa
must now construct more network and bear additional operating
losses from these markets, in addition to paying a total of $16.5
million in cash to the former owners of Roberts and WOW. However,
the original Alamosa PCS markets have been performing better than
expected with subscribers, ARPU and roaming revenues all exceeding
Moody's expectations. Alamosa PCS Holdings was also able to
generate more proceeds from its IPO earlier this year than Moody's
had anticipated. Taken together, Moody's views the addition of the
4 million POPs from Roberts and WOW to have an essentially neutral
effect on the credit worthiness of Alamosa PCS Holdings, Inc.

While the new $305 million credit facility is secured by the stock
and assets of the borrower and its subsidiaries, this facility
represents a large portion of the company's debt capital.
Consequently, the facility is rated at the same level as the
company's senior implied rating.

Based in Lubbock, Texas, Alamosa PCS is the exclusive provider of
Sprint PCS products and services in territory covering
approximately 12.5 million people (pro forma for the pending
acquisitions of Roberts and WOW).


APB ONLINE: A Month Behind on Payroll
-------------------------------------
Once again, APBNews.com is back from the brink of death, but its
days could still be numbered, according to a newswire report.  A
month behind on payroll, the Web site's owner, SafetyTips.com,
faced a spontaneous staff mutiny.  The Massachusetts-based company
managed to deliver half of its missed payments to the full-time
editorial staff of 15.  These staffers are still due another
check, which has promised to be delivered, said Hoag Levins,
executive editor.  Levins said the newsroom continued normal
operations.  One APBNews reporter who asked not to be identified
said, "I'm skeptical about the company's future, obviously.  But
I'll keep working if we get paid."  The acclaimed crime news web
site was saved from bankruptcy court by SafetyTips.com in October.  
(ABI, 20-Dec-00)


ARMSTRONG WORLD: Look for Schedules & Statements on February 18
---------------------------------------------------------------
The Debtors say that, because of (a) the substantial size and
scope of the Debtors' businesses, as through AWI's divisions and
subsidiaries it ranks among the 500 largest publicly-held
companies in the United States and owns and operates 50
manufacturing plants in 15 countries, (b) the complexity of their
financial affairs, (c) the limited staffing available to perform
the required internal review of their accounts and affairs and (d)
the press of business incident to the commencement of these cases,
it was impossible to assemble, prior to the Petition Date, all of
the information necessary to complete and file their Schedules of
Assets and Liabilities and Statements of Financial Affairs
required under 11 U.S.C. Sec. 521 and Rule 1007 of the Federal
Rules of Bankruptcy Procedure. The Debtors note that they have
tens of thousands of vendors and other potential creditors and
approximately 18,300 employees. Further, they must ascertain the
pertinent information, including addresses and claim amounts, for
each of these parties to complete the Schedules and Statements on
a Debtor-by-Debtor basis.

Accordingly, the Debtors sought and obtained from Judge Farnan an
extension of their time within which to file their Schedules and
Statements to February 18, 2001. (Armstrong Bankruptcy News, Issue
No. 2; Bankruptcy Creditors' Service, Inc., 609/392-0900)


CENTRAL BENEFITS: S&P Lowers Financial Strength Rating to Bpi
-------------------------------------------------------------
Standard & Poor's lowered its financial strength rating on Central
Benefits National Life Insurance Co. (CBNL) to single-'Bpi' from
double-'Bpi'.

The rating is based on CBNL's reduced level of capitalization,
weak earnings, and strong liquidity.

Based in Columbus, Ohio, CBNL writes mainly group accident and
health insurance, with a specialization in hospital indemnity and
major medical coverages. The company's major states of Ohio,
Arizona, Wisconsin, Kansas, and Indiana constitute more than two-
thirds of its business, and its products are distributed primarily
through brokers.

CBNL (NAIC: 63541), which began operations in 1956, is licensed in
25 states. In December 1999, the company announced that it would
begin a plan to withdraw completely from the fully insured group
health insurance market, with a target completion date of
September 2000. CBNL also announced it would continue to market
self-insured groups, Medicare supplement, and group life business.
All outstanding common stock of the company is owned by Central
Benefits Mutual Insurance Co. (not rated), an insurance holding
company domiciled in the District of Columbia. CBNL owns 100% of
the outstanding common stock of both Central Benefits
Administrators Inc. and Central Benefits Managed Care Corp.
(CBMCC). CBNL had an agreement with CBMCC that gave the company
the right to market and underwrite CBMCC's managed care products.

Major Rating Factors:

   -- Capitalization at year ended 1999 was marginal, as indicated
       by a Standard & Poor's capital adequacy ratio of 17.9% and
       an NAIC risk-based capital ratio of 53.5%. CBNL's largest
       risk assets consist of $0.7 million in home office real
       estate, which represents 22.2% of total adjusted capital,
       and CMOs and loan-backed bonds account for 13.0% of total
       invested assets.

   -- Total adjusted capital was $3.2 million at year-end 1999
       versus $16.2 million in 1998, a decrease of 80.1%. The
       decline in surplus of $13.0 million from 1998 was caused
       primarily by a loss of $11.8 million in net income and
       negative $1.4 million in miscellaneous loss write-ins to
       surplus. Primarily responsible was the group accident and
       health segment, which had a $8.6 million decline from 1998
       levels based on pretax income before dividends to
       policyholders. This decline largely reflected the company's
       establishment of a deficiency reserve. In March 2000, the
       company's parent contributed $6.2 million in securities to
       strengthen the company's surplus position.

   -- Operating performance has been weak, with a five-year
       average ROR of negative 5.2% and a Standard & Poor's
       earnings adequacy ratio of negative 152.8%. In addition,
       the company has displayed an irregular pattern of operating
       earnings that, in conjunction with its current capital base
       of $3.2 million, limits the rating. Since 1995, ROR has
       varied from negative 17.0% to positive 0.7%.

   -- The company's liquidity remains extremely strong, with a
       liquidity ratio in excess of 260%.

The rating is based on stand-alone characteristics without implied
support from the Central Benefits Group.


CONTIFINANCIAL CORP: N.Y. Court Confirms Plan of Reorganization
---------------------------------------------------------------
ContiFinancial Corporation (OTC Bulletin Board: CFNI) said that
the United States Bankruptcy Court for the Southern District of
New York has approved its Plan of Reorganization to emerge from
Chapter 11 of the United States Bankruptcy Code. Pursuant to the
terms of the plan, the Company's assets will be transferred to a
Liquidating Trust, which will manage the assets to realize cash
for distribution to creditors.

ContiFinancial Corporation is a financial services company with
headquarters in New York City. The Company and its subsidiaries
filed for Chapter 11 protection on May 17, 2000.


CUMMINS ENGINE: S&P Places Ratings on CreditWatch Negative
----------------------------------------------------------
*** 5.65% Bonds trading in the high-60's
*** Next interest payment due March 1, 2001

Standard & Poor's placed its ratings for Cummins Engine Co. Inc.
on CreditWatch with negative implications.  The company's debt, as
of Sept. 24, 2000, totaled about $1.4 billion.

The CreditWatch placements reflect Cummins' weaker-than-expected
operating results. Cummins' weak operating results are occurring
during a period of elevated debt levels and could delay expected
improvement in the company's financial profile.

The company has announced that it expects to report a net loss in
its fiscal 2000 fourth quarter of approximately $13 million-$17
million, compared with net income of $70 million for the same
period in 1999. This follows a 50% drop in net income in the third
quarter. The drop in profitability is primarily related to the
sharp downturn in North American heavy-duty truck production and
deteriorating demand in a number of other end markets. Cummins'
shipments of engines for the heavy-duty truck market have
decreased more than 50% below last year and are now at least 5%-
10% below third-quarter levels.

Cummins also has been affected by weakness in automotive, medium-
duty truck, and construction equipment markets. DaimlerChrysler
AG's recent decision to reduce vehicle production levels is
expected to result in a 20% drop in Cummins' engine shipments for
the Dodge Ram pickup truck in the fourth quarter. The slowing
domestic economy has led to lower-than-expected sales to the
construction equipment, medium-duty truck, recreational vehicle,
and consumer small engine markets.

Additional concerns relate to the ongoing consolidation in diesel
engine markets, which could impair the company's long-term
competitive position. Cummins is currently considering strategic
options to address the ongoing weak returns of its heavy-duty
truck engine business, including partnering with another industry
player.

Acquisitions and heavy capital spending during the past few years
have led to increased debt levels, with total debt to capital at
51% as of Sept. 24, 2000. Standard & Poor's had expected total
debt to capital to average about 40%. A $160 million pretax
restructuring charge will be taken in the fourth quarter, further
increasing debt leverage. Restructuring actions are focused
largely in the company's engine business and include employee
terminations and layoffs; the cancellation or delay of several new
product programs; and the closing, consolidating, or exiting of
several businesses and facilities. The company expects to achieve
$55 million in annual savings.

Standard & Poor's will meet with management to review the
company's financial results and to discuss the likely time frame
for achieving operating improvements. If it appears that operating
improvements and debt reduction will be substantially delayed,
ratings could be lowered. -- CreditWire

RATINGS PLACED ON CREDITWATCH WITH NEGATIVE IMPLICATIONS

                                             RATINGS
Cummins Engine Co. Inc.
  Corporate credit rating                      BBB+
  Senior unsecured debt rating                 BBB+
  Subordinated debt rating                     BBB
  Sr unsecured debt shelf rating (prelim)      BBB+
  Commercial paper rating                      A-2
  Short-term corporate credit rating           A-2


GE CAPITAL: Fitch Downgrades Ratings on Home Equity Certificates
----------------------------------------------------------------
Fitch lowers the ratings of the following GE Capital Mortgage
Services, Inc. (GECMSI) home equity loan pass-through
certificates:

   a) series 1997-HE1 class B1 from `A' to `BBB-';

   b) series 1997-HE2 class B2 from `BBB' to `BB';

   c) series 1997-HE2 class B3 from `CCC' to `D'.

In addition, the series 1997-HE1 class B1 and the series 1997-HE2
class B2 remain on Rating Watch Negative.

The original credit enhancement level for the 1997-HE1 class B1
certificate was 3.00%. As of the November remittance period, the
credit enhancement level was 3.30%. Cumulative losses on the
underlying collateral equal to $2,800,480, or 1.42% of the
original collateral balance.

Original credit enhancement levels for the 1997-HE2 certificates
were 2.50% and 1.50% for the classes B2 and B3, respectively. As
of the November remittance period, the credit enhancement levels
were 2.43% and 0.00% for the classes B2 and B3, respectively.
Cumulative losses on the underlying collateral equal to
$3,444,018, or 1.41% of the original collateral balance.
Fitch's rating actions reflect the likelihood of loss to the
referenced classes, given the performance to date and the
outstanding 90+ day delinquent loans, including loans in
foreclosure and REO.

Fitch will continue to closely monitor the performance of these
transactions.


GENESIS/MULTICARE: Agrees to Lift Stay for Insured Claim
--------------------------------------------------------
Genesis Health Ventures, Inc., consented to, and in the absence of
objections, obtained the Court's approval of their agreement with
the estate of Elizabeth H. Gee by and through James T. Gee, as
personal representative, to modify the automatic stay to permit
the prosecution and defense by the parties of the State Court
Action (Case No. 99 31623 CICI) pending in the Seventh Judicial
Circuit of the State of Florida, in and for the County of Volusia,
against Genesis Health Ventures, Inc. Claimant may enforce or
execute (a) settlement, (b) judgment entered by a court of
competent jurisdiction or (c) other disposition of the underlying
claims in the State Court Action only to the extent such claims
are covered by proceeds from applicable GHV liability insurance
policies. (Genesis/Multicare Bankruptcy News, Issue No. 6;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


GENESIS HEALTH: Seeks Further Extension of Exclusive Periods
------------------------------------------------------------
Genesis Health Ventures, Inc. filed a motion seeking U.S.
Bankruptcy Court approval of an extension of the exclusive period
during which the company can file a plan of reorganization and
solicit acceptances thereof. The Court scheduled a January 4th
hearing to consider the motion; objections are due by December
27th. The Company has been operating under Chapter 11 protection
since June 22, 2000.  (New Generation Research, Inc., 20-Dec-00)


HARNISCHFEGER: U.S. Trustee Objects to Disclosure Statement
-----------------------------------------------------------
The United States Trustee for Region III objects to the First
Amended Disclosure Statement filed by Harnischfeger Industries,
Inc., in support of its First Amended Joint Plan of
Reorganization.  The objection has three bases:

   (1) Failure to File/Serve Exhibits

   (2) The Jay Alix Disqualification Motion by UST

   (3) Failure to Identify Directors/Officers of New HII and
       Failure to Identify Plan Administrator

                (1) Failure to File/Serve Exhibits

The UST relates frustration experienced by personnel in his office
trying to get a copy of the "Exhibits and Schedules Filed with the
Court but not Served" referred to in Page xiii of the First
Amended Disclosure Statement.

On November 29, 2000 at about 5:00 p.m. Joseph J. McMahon, Jr., a
Trial Attorney for the UST, called the number of BMC as identified
in a footnote in the Statement in an attempt to obtain a copy of
the Missing Exhibits/Schedules.

BMC personnel referred him to Ms. Tina Marie Feil, whol was
stationed in Milwaukee on that day.

Mr. McMahon contacted Ms. Feil via telephone shortly after 5:00
p.m. Ms. Feil indicated that BMC did not have copies of the
Missing Exhibits/Schedules but said that she would contact the
Debtors' counsel Kirkland & Ellis for that.

Ms. Feil returned before 6:00 p.m. and said she spoke with
Stephanie Simon, Esq. Of K&E but Ms. Simon said she was unable to
produce copies of the Missing Exhibits/Schedules because they were
not reduced to final format. Ms. Simon told Ms. Feil that the
Missing Exhibits/Schedules would not be filed until the next
amended version of the Disclosure Statement was filed.

The Debtors apparently take the position that, minus the Missing
Exhibits/Schedules, the First Amended Disclosure Statement
contains "adequate information;" a letter from Debtors' counsel to
Mr. McMahon dated December 4,2000 states that Debtors did not
intend the footnote about availabiltiy of those Exhibits/Schedules
to become operative until the First Amended Disclosure Statement
was approved.

The UST notes that the Missing Exhibits/Schedules are referenced
at numerous points in the First Amended Disclosure Statement. By
failing to File/Serve Missing Exhibits/Schedules, the Debtors
Violated Rules 30l6(b) and 3017 and renders the disclosure
inadequate, the UST alleges.

The UST notes that the Missing Exhibits/Schedules are referenced,
for example, in defining the scope of the exculpation being
granted to the Plan Administrator and its related entities

Furthermore, without the Missing Exhibits/Schedules, the Debtors'
First Amended Disclosure Statement does not contain "sufficient
detail" regarding post-confirmation estate administration.

           (2) The Jay Alix Disqualification Motion

Based upon Mr. Dangremond's testimony that he was serving as a
director of Beloit Corporation post-petition, the UST believes
that Mr. Robert Dangremond, a principal of Jay Alix & Associates,
may not be a "disinterested person" and/or may "hold or represent
an interest adverse to the estate" in contravention of section 327
of the Bankruptcy Code.

The UST then filed her Motion to (1) Disqualify Jay Alix &
Associates, (2) to Disgorge Compensation and Reimbursement Paid to
Jay Mix & Associates and (3) to Prospectively Deny Compensation
and Reimbursement to Jay Mix & Associates. The Jay Alix
Disqualification Motion has been assigned to Judge Walrath for
disposition.

In the Jay Alix Disqualification Motion, the UST leaves the issue
of the disallowance of compensation/reimbursement paid
to/requested by Jay Alix to the discretion of this Court. The UST
believes and avers that compensation/reimbursement paid
to/requested by Jay Alix totals at least $8 million. The UST notes
that after adjudicating the Jay Alix Disqualification Motion, the
Court may order reduction of compensation/reimbursement paid
to/requested by Jay Alix.

The UST alleges that there are several parts of the First Amended
Joint Plan of Reorganization which may affect adjudication of the
Jay Alix Disqualification Motion by the Court.

The UST also criticizes that the Debtors' First Amended Disclosure
Statement does not contain any information with respect to the Jay
Alix Disqualification Motion and parts of the Statement may
address Exculpation and Release of Jay Alix from the UST's Claims
in the Jay Alix Disqualification Motion.

The UST draws the Court's attention to:

(a) Exculpation of the Plan Administrator

     Paragraph V(C)(l2) of the Amended Statement requires the Plan
     Administrator to "subcontract with Jay Alix to perform the
     duties and to receive the compensation specified in the Jay
     Alix Contract."

     Paragraph V(C)(10) of Debtors' First Amended Disclosure
     Statement exculpates the Plan Administrator's professionals
     (vis a vis "parties in interest," among other entities) from

        any and all claims, causes of action, and other assertions
        of liability arising out of the discharge of the powers
        and duties conferred upon the Plan Administrator or the
        Advisory Committee by the Plan or any order of the
        Bankruptcy Court entered pursuant to or in furtherance of
        the Plan.

     The UST finds the scope of the proposed exculpation vague and
     raises the question of whehter the Court's prior order
     approving the retention of Jay Alix constitute an "order of
     the Bankruptcy Court entered pursuant to or in furtherance of
     the Plan"

(b) Exculpation of Directors and Professionals

     Paragraph IX(E)(l) of the First Amended Disclosure Statement
     (p. 158) indicates that, as of the Effective Date of the
     First Amended Joint Plan of Reorganization, the "Releasing
     Parties" will be deemed to issue a blanket release and waiver
     of all pre-Effective Date activity by Debtors' directors,
     officers, employees and Professionals.

     The UST notes that Jay Alix and its principal(s)/agent(s)
     fall into one or more of the categories identified in that
     Paragraph.

The UST points out that the Debtors do not specifically indicate
that confirmation of Debtors' First Amended Joint Plan of
Reorganization may extinguish any liability that Jay Alix has to
Debtors' estates, that confirmation means that Debtors may be
foregoing any court-ordered reduction of Jay Alix's paid/requested
compensation/reimbursement if the UST successfully prosecutes the
Jay Alix Disqualification Motion.

The UST believes that the Debtors' failure to explain the effect
Confirmation may have on adjudication of the Jay Alix
Disqualification Motion renders Disclosure inadequate.

           (3) Failure to Identify Plan Administrator
                 and Directors/Officers of New HII

The UST criticizes that the Debtors do not provide a definitive
answer as to who the Plan Administrator will be and what the Plan
Administrator will be paid. The First Amended Disclosure Statement
indicates that the Plan Administrator will be "BDO Seidman, LLP or
such other person or entity identified by the Beloit Committee on
or before the Confirmation Date as the Plan Administrator in an
appropriate pleading filed with the Bankruptcy Court and served on
appropriate parties in interest."

The UST also points out that the Debtors fail to disclose: (1) the
identity of the New HII Directors and Officers; (2) the identity
of the Executive Vice President/Treasurer/Chief Financial Officer
of New HII; and (3) the proposed compensation to all insiders.
The UST does not think that the Debtors' representation that the
directors and officers will not be receiving any additional
compensation for their services as insiders satisfies the section
1129(a)(5) which requires that Debtors disclose

   . . . the identity and affiliations of any individual proposed
to serve, after confirmation of the plan, as a director, officer,
or voting trustee of the debtor, an affiliate of the debtor
participating in ajoint plan with the debtor, or a successor to
the debtor under the plan; and (ii) the appointment to, or
continuance in, such office of such individual, is consistent with
the interests of creditors and equity security holders and with
public policy.

For the reasons cited, the UST does not think the Debtors' First
Amended Disclosure Statement contains "adequate information" as
that term is defined in 11 U.S.C. section 1125(a)(1).
(Harnischfeger Bankruptcy News, Issue No. 35; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


HARNISCHFEGER: Files Second Amended Plan of Reorganization
----------------------------------------------------------
Harnischfeger Industries, Inc. filed a Second Amended Plan of
Reorganization and related Disclosure Statement with the U.S.
Bankruptcy Court. The Company has been operating under Chapter 11
protection since June 7, 1999.  (New Generation Research, Inc.,
20-Dec-00)


HEILIG-MEYERS: Aaron Rents Acquires 27 Leases in Auction
--------------------------------------------------------
Aaron Rents Acquires Leases on 27 Heilig-Meyers Locations
Aaron Rents Inc., the nation's leader in the rental, rental
purchase and specialty retailing of residential and office
furniture, consumer electronics and home appliances, announced
that it has acquired 27 real estate leases auctioned off through
bankruptcy court proceedings by Heilig-Meyers, according to a
newswire report. In addition to these leased facilities, the
company also acquired one store in which the real estate was owned
by Heilig-Meyers. The Atlanta-based Aaron Rents plans to reopen
these stores over the next two quarters in its rental purchase
division as Aaron's Sales and Leasing stores. Aaron Rents Inc.
controls more than 545 company-operated and franchised stores in
42 states. (ABI 20-Dec-00)


ICG COMMUNICATIONS: Inks $350MM DIP Financing Pact with Chase
-------------------------------------------------------------
ICG Communications and its affiliated Debtors submitted a Motion
requesting that the U.S. Bankruptcy Court in Wilmington, Delaware,
review, approve and authorize them to obtain post-petition
financing in an aggregate principal amount not to exceed $350
million, including a $10 million sublimit for standby and letters
of credit from The Chase Manhattan Bank as agent for a syndicate
of financial institutions to be arranged by Chase as agent. This
Motion affects only operating companies owned directly or
indirectly by ICG Holdings, Inc., including ICG Telecom Group,
Inc., together with the subsidiaries of Holdings and Telecom. ICG
NetAhead and ICG Equipment, the Services Debtors, had filed a
separate Motion seeking approval of DIP financing for them.

In support of this request, the Debtors produced evidence that
their operations are conducted through two principal groups of
operating companies: the Telecom Debtors and the Services Debtors.
As of the Petition Date, the Telecom Debtors had approximately
$160 million of cash on hand, which is not subject to liens in
favor of any party and thus did not constitute cash collateral.
Conversely, all of the Services Debtors' assets are pledged to
secure the Prepetition Services Credit Agreement Obligations, and
on November 16, 2000, this Court approved a Stipulation and Order
providing for the use of the Services Debtors' cash collateral on
a consensual basis with the Prepetition Services Lenders.

Based upon cash budgets prepared by the Debtors, with the
assistance of their financial professionals in contemplation of
these Chapter 11 cases, the Debtors asserted that additional
liquidity in the form of third-party financing may be required to
fund the operations of the Telecom Debtors during these Chapter 11
cases. The Debtors do not believe that additional liquidity in the
form of third-party financing will be needed by the Services
Debtors to fund their operations, although if certain assumptions
underlying the Debtors' cash budgets prove incorrect, the Services
Debtors may also need such additional liquidity to fund their
operations.

Because the Telecom Debtors' existing cash on hand may not be
sufficient to fund the completion of their restructuring process,
the Debtors concluded that obtaining a firm commitment for
postpetition financing at the outset of these cases was necessary
and in the best interests of these estates. Accordingly, before
the Petition Date the Debtors approached numerous financial
institutions about providing postpetition financing.

In seeking to obtain a commitment for financing from potential
lenders, the Debtors sought to obtain separate financing for the
Telecom Debtors and the Services Debtors; i.e., financing for each
group of operating companies that would not require the other
group to be jointly and severally liable or have assets of either
group pledged to secure borrowings of the other. Despite these
efforts, no prospective lender made any proposal to the Debtors
for a loan to any of the Debtors that would not be the joint and
several obligation of all of the Debtors, secured by all of the
Debtors' respective assets.

The proposed Postpetition Financing from Chase was the most
favorable postpetition financing proposal received by the Debtors;
in fact, Chase's proposal was the only committed financing
proposed by any potential lender by the Petition Date. The Debtors
have thus determined that obtaining Postpetition Financing from
Chase is in the best interests of their estates. The Debtors
stated that the proposed Postpetition Financing is necessary for
them to operate their business and enable them to complete a
successful restructuring.

The Postpetition Financing Agreement's principal provisions are:

   (a) The Borrowers. Each of the Debtors as co-borrowers;

   (b) The Lenders. A syndicate of financial institutions,
including Chase, to be arranged by Chase;

   (c) The Commitment. $200 million fully underwritten by Chase
with a sublimit of $10 million for standby and import documentary
letters of credit to be issued for purposes that are satisfactory
to Chase as Agent, with up to $150 million of additional funds to
be made available (if elected by the Debtors) upon satisfactory
completion of an appraisal of the Debtors' assets by Chase and the
successful completion of a syndication of the loan, to be
conducted by Chase on a good faith commercially reasonable basis;

   (d) Availability. For working capital, the Debtors' other
general corporate purposes, and to repay the Prepetition Services
Credit Agreement obligations;

   (e) Term. Up to 18, but not less than 12, months from the
Petition Date;

   (f) Priority. Superpriority status, subject to the Carve-Out;

   (g) Liens. Any claim under the DIP Credit Agreement shall be
secured by the following liens, subject to the Carve-Out:

        (i)   A perfected first priority lien on all unencumbered
property of the Debtors (other than causes of action arising under
the Bankruptcy Code); and

        (ii)  A perfected junior lien on all the Debtors' property
subject to valid and perfected liens in existence as of the
Petition Date or to valid liens in existence as of the Petition
Date and perfected after the Petition Date as permitted by the
Bankruptcy Code;

   (h) Carve-out. In the event of an occurrence and during the
continuance of an Event of Default or an event that with the
passage of time will constitute an Event of Default:

        (i)   $3.0 million in fees and disbursements incurred by
professionals retained by the Debtors and any statutory committees
appointed in these cases (plus all professionals fees and
disbursements incurred prior to an Event of Default to the extent
allowed by the Bankruptcy Court); and

        (ii)  fees payable to the Office of the United States
Trustee and to the Clerk of this Court; provided that professional
fees and expenses either paid or accrued but unpaid prior to the
occurrence of an Event of Default may be paid and shall not reduce
the Carve-out;

   (i) Fees.

        (i)   An advisory and structuring fee of 1.5% of the
Initial Commitment (which was paid prior to the Petition Date);

        (ii)  A facility fee of up to 2.0% of the Initial
Commitment (to be paid upon entry of a final order approving the
proposed Postpetition Financing);

        (iii) An administrative agent fee of $250,000 per annum;

        (iv)  A commitment fee equal to 1.5% per annum on the
unused amount of the Commitment;

        (v)   Letter of credit fees equal to 4% per annum on the
outstanding face amount of each letter of credit plus customary
fees for fronting, issuance, amendment, and processing.

        (vi)  If the Additional Commitment is obtained and the
Debtors elect to accept it, an advisory and structuring fee of
1.5% of the amount of the Additional Commitment (payable when
obtained and accepted by the Debtors) and a facility fee of up to
2.0% of the amount of the Additional Commitment (payable when
obtained and accepted by the Debtors); and

        (vii) An "Early Termination Fee' that requires the Debtors
to pay to the Agent a recurring fee of 1% of the amount of the
Commitment payable on each of

                (a) the earlier of (x) 6 months after the Petition
Date And (y) a sale of a significant portion of the Debtors'
assets;

                (b) 12 months after the Petition Date; and

                (c) 18 months after the Petition Date.

   (j) Interest. Alternate Base Rate plus 3% or, at the Debtors'
option for 1 or 3 month periods, LIBOR plus 4%, payable monthly in
arrears;

   (k) Default Rate. 2% above applicable rate during period of
default on payments due under DIP Credit Agreement; and

   (l) Default/Remedies. On continuation of an event of default
beyond the applicable grace period, if any, the Agent may exercise
remedies without further Order or application to this Court, but
Agent must first provide five business days' written notice to the
Debtors, counsel for the Creditors, Committee, counsel to the
Prepetition Services Agent, and the United States Trustee before
exercising any remedies against the Debtors' property or any right
of setoff.

The Commitment is conditioned upon repayment in full of the
Prepetition Services Credit Agreement Obligations with and as a
condition to the first draw under the Postpetition Financing. The
Prepetition Services Credit Agreement Obligations total
approximately $85 million and are secured by substantially all of
the assets of ICG Equipment and ICG NetAhead. The book value of
these assets as of September 30, 2000, exceeds $1.3 billion.

The Debtors admitted that the Prepetition Services Credit
Agreement Obligations constituted valid indebtedness that is
secured by valid, perfected liens on collateral that has a value,
even on a liquidation basis, far in excess of $85 million.

According, the Debtors argued that repaying the Prepetition
Services Credit Agreement Obligations with borrowings under the
Postpetition Financing is appropriate and will not be detrimental
to these estates, and thus request authority to repay the
Prepetition Services Credit Agreement Obligations in full with
advances under the proposed Postpetition Financing. If the
proposed Postpetition Financing is approved, such repayment shall
occur when the Debtors determine that the first borrowings under
the Postpetition Financing to fund operations are necessary.

The Debtors propose that such repayment will be subject to a full
reservation of rights of the Creditors' Committee or any other
party in interest in these cases to challenge, within 90 days of
the date of entry of the proposed Order, the claims or liens of
the Prepetition Services Agent and the Prepetition Services
Lenders, after which time, if no such challenge is made, the
repayment of the Prepetition Services Credit Agreement Obligations
shall be binding on all parties in interest. In the event that the
Court were to make a final determination that all or a portion of
the Prepetition Services Credit Agreement Obligations do not
constitute allowed secured claims, the proposed Order accompanying
the Motion provides for disgorgement of such payments made to the
prepetition Service Lenders, with the proceeds returned to the DIP
Lenders to repay outstanding obligations under the Postpetition
Financing (with any excess returned to the Debtors) and the
commitment under the Postpetition Financing reduced by such
amount. (ICG Communications Bankruptcy News, Issue No. 2;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


ICG COMMUNICATIONS: Nasdaq Announces Decision to Delist Shares
--------------------------------------------------------------
Telephone and Internet services firm ICG Communications Inc. said
that the Nasdaq had decided to delist the company's shares as a
result of the company's chapter 11 filing in November, according
to a Reuters report. The Englewood, Colo.-based ICG filed for
chapter 11 on Nov. 14.  Earlier this month, both its chief
financial officer and president resigned.  (ABI 20-Dec-00)


INTERSTATE BAKERIES: Moody's Places Baa3 Ratings Under Review
-------------------------------------------------------------
Moody's today placed the Baa3 ratings for two senior unsecured
bank credit facilities for subsidiaries of Interstate Bakeries
Corporation (IBC) under review for possible downgrade. Moody's
also assigned prospective ratings of (P)Baa3 senior unsecured;
(P)Ba2 subordinated; and (P)"ba3" preferred stock for IBC's new
$500 million multi seniority shelf, with all of these newly
assigned prospective ratings also being placed on review for
possible downgrade. The review is prompted by IBC's recent
announcement of declining operating performance and weaker-than-
expected debt protection measures. Moody's review will focus on
the degree to which IBC can reasonably be expected to improve its
debt protection measures in the near term. The review will also
focus on the companies' financial flexibility given that its soft
operating performance has risen at a time when it must refinance
almost all of its debt in the credit markets within the next nine
months.

Ratings placed on review for possible downgrade

   I)   Interstate Brands Corporation

         - $350 million senior unsecured credit facility at Baa3

   II)  Interstate Brands Corporation and Interstate Brands West
         Corporation as Co Borrowers

         - $610 million senior unsecured credit facilities at Baa3

Prospective ratings assigned and placed under review for possible
downgrade.

   I)  Interstate Bakeries Corporation (parent), Interstate Brands
        Corporation, and Interstate Brands West Corporation.

        a) Senior unsecured shelf at (P)Baa3, under review for
            possible downgrade

        b) Subordinated shelf at (P)Ba2, under review for possible
            downgrade

   II) Interstate Bakeries Corporation

        a) Preferred stock at (P)"ba3", under review for possible
            downgrade Higher fuel and medical costs have
            contributed to IBC's soft operating performance.

Also, IBC has encountered manufacturing difficulties in some of
its plants, as well as lost market share in in its Northeast and
Northwest regions caused by these manufacturing difficulties, as
well as a strike earlier in the year.

Each of the bank credit facilities, as well as senior or
subordinated debt and preferred stock issued under the shelf, is
cross guaranteed by Interstate Bakeries Corporation (parent),
Interstate Brands Corporation, and Interstate Brands West
Corporation.

IBC, headquartered in Kansas City MO, is the largest baker and
distributor of fresh bakery products in the U.S.


MARINER POST: Selling Brazos' Geriatric Center for $2,800,000
-------------------------------------------------------------
Mariner Post-Acute Network, Inc., sought and obtained the Court's
authority to sell the assets of the Brazos Valley Geriatric
Center, free and clear of liens, claims, encumbrances, and other
interests, pursuant to an Asset Purchase Agreement between Weston
Inn Group, L.L.C., as buyer, and Living Centers of Texas, Inc.,
which is a wholly owned subsidiary of MPAN and a Debtor in these
cases, as seller, and to reject certsin executory contracts
related to the facility.

In exchange for the Assets, Weston shall pay to the Debtors $2.8
million in cash, subject to certain adjustments and prorations.
The Debtors estimate that their net proceeds will be approximately
$2.4 million. Weston has escrowed $100,000 that is currently non-
refundable unless the Debtors' senior secured prepetition lenders
do not consent ot the sale.

Brazos Valley Geriatric Center is a 136-bed licensed long-term
care nursing home, located at 1115 Anderson, College Station,
Texas. For the nine months ended June 30, 2000, the Facility
produced operating losses at an annualized rate of approximately
$1,083,929, before interest, taxes, depreciation and amortization
(EBITDA). The average occupancy of the Facility was approximately
fifty-eight percent. MPAN believes the Facility's poor financial
performance is largely a result of the significant insurance and
personal injury claims costs, which are currently in excess of
$1.2 million annually. If not for these insurance costs, the
EBITDA of the Facility is $147,353 but after accounting for
insurance costs, the Faciltiy suffers an annualized EBITDA loss of
$1,083,929.

In light of the financial performance, the Debtors believe it is
sound business judgement to sell the Facility. Selling an
unprofitable nursing facility such as the Brazos Valley Geriatric
Center, the Debtors note, is significantly less costly than
closing it. Besides getting rid of the economic burden of
incurring the losses, the Debtors will be able to realize
net proceeds of approximately $2.4 million through the Sale. In
accordance with their DIP financing arrangements, the Debtors will
be able to use 25% of such net proceeds for, "among other things,
their working capital needs" and the balance will be paid to the
Debtors' prepetition senior secured lenders as an "adequate
protection" payment.

The Debtors tell Judge Walrath that Weston's offer was the highest
offer the Debtors received, both in terms of the purchase price
and the amount of the earnest money deposit offered, and because
the offer was not subject to contingencies that could impair
Weston's ability to close the Sale.

Pursuant to the Purchase Agreement, LCT shall sell and assign to
Weston all of LCT's right, title and interest in and to the Assets
which include Real Property, Personal Property including all
licenses and permits, Intangibles, books and records, agreements
with residents and their guarantors, to the extent assignable, and
the going concern of the business including the name of the
business and the current telephone numbers.

The Debtors will also assume and assign to Weston the Medicare
provider agreement between LCT and the Health Care Financing
Administration relating to the Facility, on terms which have been
previously approved by HCFA and this Court in these cases with
respect to sales of similar facilities. The Debtors will seek
HCFA's approval of the same terms with respect to this
Sale.

Notwithstanding the assumption and assignment of the Medicare
Provider Agreement, any claim of Medicare, the applicable fiscal
intermediary, the Department of Health and Human Services (HHS),
or any other party against the Debtors under the Medicare Provider
Agreement arising prior to the Petition Date will continue to be
treated as a prepetition claim with the same rights, status, and
priority as if such Medicare Provider Agreement had been rejected,
so that such claims will not become or be treated as
administrative claims, and will not be offset against any of the
Debtors' claims arising after the Petition Date. Instead, HCFA
will be allowed to offset all such claims (to the extent valid,
and without prejudice to the Debtor's right to dispute such claim)
against any prepetition underpayment claim of the Debtors arising
with respect to the Debtors' "prudent buyer" claim against
Medicare, even if the claim and debt are not "mutual," as
ordinarily required by 11 U.S.C. section 553, and without further
order of the Bankruptcy Court.

The rights accorded the United States pursuant to the sale will
constitute "cure" under 11 U.S.C. section 365, so that Weston will
not have successor liability for any claim against any Debtors
under the Medicare Provider Agreement.

The Debtors submit that the consideration is fair and reasonable,
the transaction is the product of arms' length, good faith
negotiations, and is in the best interest of the MPAN Debtors and
their estates, and adequate and reasonable notice has been
provided.

In a limited objection filed with the Court, the Creditors'
Committee opines that the Debtors' strategy of disposing of under-
performing facilities under the Debtors' management and control
may not prove to be the best manner in which to maximize the value
of the Debtors' estates and properties. Assuming the Divestiture
Facilities are in fact to be divested, the Committee reminds
of an alternative manner, by means of a global transaction,
involving all or a majority of the Divestiture Facilities, as
opposed to a series of "one off" transactions. However, the
Committee indicated that they were not challenging the Debtors'
business judgment or requesting that the Court deny approval of
the Purchase Agreement and the Sale Motion. The Committee also
expressed that like the Debtors, they believed that proposed
sales, divestitures, closures and other dispositions of long-term
care facilities owned and operated by the Debtors must be
carefully analyzed and scrutinized.

County of Brazos, as Taxing Authorities, also filed a limited
objection. The Court found that the transfer of the Assets free
and clear of all Interests is appropriate under the circumstances
because the holders of such Interests have consented to such
transfer. Nevertheless, the Court's order provides that the
delinquent personal property taxes, in the amount of $3,365 plus
interest, to be calculated at the statutory rate of 1% per month
from February, 2000, are to be paid in full from the proceeds of
the sale, at the time of the closing of the sale transaction, and
all ad valorem tax liens on real and personal property for the
2000 tax year are expressly retained until the payment by the
purchaser of the year 2000 ad valorem taxes, and any penalties or
interest which may ultimately accrue to those year 2000 taxes, in
the ordinary cours of business. (Mariner Bankruptcy News, Issue
No. 11; Bankruptcy Creditors' Service, Inc., 609/392-0900)


PACIFIC GATEWAY: President & CEO and COO Tender Resignations
------------------------------------------------------------
Pacific Gateway Exchange, Inc. (Nasdaq: PGEX) announced that it
has accepted the resignations tendered by Howard Neckowitz,
formerly president and chief executive officer, and Gail Granton,
formerly chief operating officer.

Mr. Neckowitz and Ms. Granton left to pursue other interests.  Mr.
David Davis remains as the Company's chief financial officer and
as such will handle the Company's day-to-day operations.  

Development Specialists, Inc. remains as the Company's management
consulting company and will support Mr. Davis.


PATRICK INVESTMENTS: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------------
Debtor: Patrick Investments Corp.
         700 Monticello Avenue
         Norfolk, VA 23510

Type of Business: Hotel

Chapter 11 Petition Date: December 19, 2000

Court: Eastern District of Virginia - Norfolk Division

Bankruptcy Case No.: 00-72431

Debtor's Counsel: Frank J. Santoro, Esq.
                   Marcus, Santoro, Kozak & Melvin, P.C.
                   366 Crawford Parkway, Suite 700
                   P.O. Box 69
                   Portsmouth, VA 23705-0069
                   (757) 393-2555

Total Assets: $ 18,960,713
Total Debts : $ 14,670,515

20 Largest Unsecured Creditors:

IRS Special Procedures
Support Staff
P O Box 10025
Richmond, VA 23240-0025                                  $ 626,000

Radisson Hotels Worldwide
P.O. Box 1450
Minneapolis, MN 55485-7060                               $ 305,000

City of Norfolk                                          $ 130,876

Hampton Roads Utility Billing
Service                                                 $ 74,074

Virginia Employment Comm                                 $ 54,095

Commonwealth of Virginia                                  $ 46,798

Virginia Power                                            $ 34,815

North Carolina Department of
Revenue                                                  $ 21,691

Vistagraphics, Inc.                                       $ 16,392

MMG Worldwide                                             $ 15,328

US Lec Corp                                               $ 12,619

Virginia Natural Gas Inc.                                 $ 12,076

Cenit Commercial Mortgage                                 $ 11,139

Norfolk Convention & Visitors
Bureau                                                   $ 11,048

Lankford-Sysco Food Service                               $ 10,017

SGC Operating Company                                     $ 10,000

Virginia Sprinkler Company                                 $ 9,906

The Sabre Group, Inc.                                      $ 9,037

Cox Communications, Inc.                                   $ 8,529

Colours                                                    $ 8,218


PNV, INC: Communications Servicer Seeks Chapter 11 in Florida
-------------------------------------------------------------
PNV (Nasdaq: PNVN) announced that the company has filed a
voluntary petition with the U.S. Bankruptcy Court for the District
of Florida under Chapter 11 of the U. S. Bankruptcy Code 00-27807-
BKC-PGH. PNV elected to seek court protection in order to
facilitate the sale of its assets.

In its Chapter 11 filing, PNV management emphasized that the
filing has been organized to permit normal operations of its
communications, entertainment and Internet services to the
trucking industry until a decision can be reached about the sale
of the company. Several entities are currently considering
acquiring PNV's assets.

"We initiated the Chapter 11 filing to give us time to evaluate
the possibility of an orderly sale of the business and its assets.
In addition, the filing will ensure that PNV has the opportunity
to maximize the value of its business for the benefit of its
stakeholders," said Bob May, president and Chief Executive
Officer.

PNV (www.pnv.com), based in Coral Springs, FL, is a full-service
Cisco Powered Network certified communications and information
provider to the long haul trucking industry -- a $500 billion
market. PNV provides bundled communications, cable TV and Internet
services to professional truck drivers, operators, and fleets
through the company's private, integrated facilities- based
network deployed at nearly 300 truck stops in 43 states. PNV also
provides cable TV and Internet services to the participants in the
trucking community including families of professional drivers,
trucking industry suppliers and manufacturers.


PNV, INC: Nasdaq Halts Trading & Requests More Information
----------------------------------------------------------
The Nasdaq Stock Market(R) announced that the trading halt status
in PNV, Inc. (Nasdaq: PNVN) was changed to, "additional
information requested" from the company.  Trading in PNV, Inc. had
been halted today at 5:32 p.m., Eastern Time, for news pending at
a last sale price of 3/16. Trading will remain halted until the
company has fully satisfied Nasdaq's request for additional
information.

For news and additional information about the company, please
contact the company directly or check under the company's symbol
using InfoQuotes(SM) on the Nasdaq Web site.


PSINET INC: Moody's Lowers Senior Unsecured Debt Rating to Caa1
---------------------------------------------------------------
Moody's Investors Service has downgraded the senior unsecured debt
rating of PSINet, Inc. to Caa1 from B3. In addition, the senior
implied and senior secured ratings are downgraded to B3 from B2.
Other ratings affected are detailed below. All ratings remain on
review for a possible further downgrade.

Moody's action today reflects its concern that PSINet lacks
sufficient liquidity to fulfill its capital needs in the
intermediate term, that a scaled -back business plan may delay the
delivery of long-term cash flows required to service its scheduled
debt obligations, and that a sale of assets may not yield
meaningful proceeds.

As of September 30, 2000, PSINet recorded net property, plant and
equipment of $2.3 billion to support borrowings of $3.6 billion.
Unrestricted cash and short- term investments totaling $842
million were earlier considered by management to be insufficient
to meet its 2001 business plan. The company has commitments
totaling $489 million for acquired bandwidth and IRU's, as well as
long term lease commitments totaling $355 million.

Although PSINet plans to conserve cash by reducing planned capital
outlays by $200 to $300 million through 2001, the resulting
deceleration in its business plan would likely delay the company's
debt service coverage timetable. The Capex reduction will be
accomplished by delaying the construction of certain hosting
centers scheduled to open after the end of 2001. The hosting
center business is a critical component of PSINet's business
transition that will focus increasingly on providing managed web
hosting and managed applications services to data-centric business
customers. The company is considering the sale of its traditional
consumer ISP business, known as Inter.net Ltd., and is attempting
to sell its Xpedior i-services consulting business, which is
classified as a discontinued operation.

PSINet has engaged financial advisors to assist in considering
financial alternatives and exploring strategic considerations
including a possible sale of all or a portion of the company.
Although PSINet plans to dispose of certain non-strategic assets,
including its 80% interest in Xpedior, the timing and likely
proceeds from such sales are uncertain. The market value of i-
services consulting companies has decreased dramatically this
year, and the company has already taken a $504 million charge to
reflect a write-down of its Metamor assets as well as a $664
million accrual for the estimated loss on the disposal of Xpedior.
The company's ability to raise capital from other sources may be
difficult given present market conditions.

On November 3, 2000, Moody's placed the ratings of PSINet on
review for a possible downgrade, following the company's release
of third quarter results and its announcement that it had
suspended all guidance concerning 2001 revenues until February
2001. The company had earlier determined that capital requirements
under its 2001 business plan were greater than available capital
resources.

Moody's review will cover the results of the company's complete
financial and operational review that is expected to be complete
by February 2001, and will assess the progress that PSINet has
made in monetizing certain non-strategic assets.

The ratings downgraded and remaining on review for a possible
further downgrade are:

   a) Senior Implied to B3 from B2

   b) Issuer Rating to Caa1 from B3

   c) Senior Secured $110 million Credit Facility to B3 from B2

   d) 10.5% Senior Unsecured Eurobonds due 2006 to Caa1 from B3

   e) 11.5% Senior Unsecured notes due 2008 to Caa1 from B3

   f) 11.0% Senior Unsecured Notes due 2009 to Caa1 from B3

   g) 11.0% Senior Unsecured Eurobonds due 2009 to Caa1 from B3

   h) 10.5% Senior Unsecured Notes due 2006 to Caa1 from B3

   i) 10.0% Senior Unsecured Notes due 2005 to Caa1 from B3

   j) Preferred Stock to "Ca" from "Caa"

PSINet has its headquarters in Herndon, Virginia.


RELIANCE GROUP: Urges Noteholders to Ignore Ichan Tender Offer
--------------------------------------------------------------
Reliance Group Holdings, Inc. announced that it is aware of the
December 18, 2000 announcement by High River Limited Partnership,
an affiliate of Carl C. Icahn, of its intent to commence a partial
tender offer for the 9% Senior Notes issued by Reliance.

Reliance continues to work toward a consensual plan of
reorganization with an ad hoc committee of the 9% Senior Notes and
the 9.75% Senior Subordinated Debentures issued by Reliance and
the bank lenders to Reliance Financial Services Corporation, and
Reliance has kept its key insurance regulators informed of the
status of such negotiations. Reliance has made substantial
progress in its discussions with its various constituencies and
therefore urges the holders of the 9% Senior Notes not to take
action with respect to any tender by High River until a consensual
plan of reorganization has been announced.

"The Company hopes to successfully conclude its discussions with
the bondholder committee, the banks and the insurance regulators
and to publicly announce a consensual plan of reorganization in
the near future," stated George R. Baker, chief executive officer
of Reliance.


SCOUR INC: CenterSpan Acquires Assets for $9 Mil in Cash & Stock
----------------------------------------------------------------
CenterSpan Communications (Nasdaq:CSCC) announced that it has
closed its acquisition of the assets of Scour, Inc. for $9,000,000
in cash and common stock.

The specific terms required $5,500,000 in cash and $3,500,000 in
newly issued CenterSpan common stock, which represents 333,333
shares at a price of $10.50 per share. The cash portion of the
closing was delivered from funds provided by the financing
commitment announced on December 7, 2000. The $10.50 share price
was the closing price of CenterSpan's stock on the NASDAQ exchange
on Tuesday December 12, 2000, the date the auction was held in the
U.S. Federal Bankruptcy Court in Los Angeles.

CenterSpan's purchase of the assets of Scour under the
jurisdiction of the U.S. Bankruptcy Court enables the company to
take title to the Scour assets free and clear of any and all
liabilities.

About CenterSpan

CenterSpan Communications Corp. is a developer and marketer of
peer-to-peer Internet communication and collaboration solutions.
The company is developing a next generation peer-to-peer digital
distribution channel enabling members to publish, search and
purchase digital content, such as music and video files, in
a secure and legal environment. CenterSpan is an Intel Capital
portfolio company. Visit www.centerspan.com to learn more.


VENCOR, INC: Signs Stipulation with Lenox, Ventas and the Clarkes
-----------------------------------------------------------------
Vencor, Inc., asks Judge Walrath to approve, pursuant to section
105 of the Bankruptcy Code and Rule 9019(a) of the Bankruptcy
Rules, an agreement and Stipulation among Vencor and:

   (1) Lenox Healthcare, Inc., debtors and debtors in possession,
        in the Chapter 11 cases jointly administered under Case
        No. 99-4022 (MFW) filed on November 3, 1999;

   (2) Ventas, Inc. and Ventas Realty, Limited Partnership; and

   (3) Thomas M. Clarke and Linda M. Clarke, guarantors of Lenox.

The Debtors relate that, between February 1997 and April 1998,
they entered into certain agreements with the Lenox Debtors under
which the Lenox Debtors purchased, subleased, or agreed to manage
30 long-term care facilities in ten different states (the Lenox
Transactions). The Clarkes agreed to guarantee certain of the
obligations of the Lenox Debtors arising from the Lenox
Transactions. Currently, the Debtors and the Lenox Debtors
continue to be parties to certain of the subleases, and management
agreements, certain of which the Lenox Debtors intend to assume.

Prior to the Petition Date, the Lenox Debtors commenced a number
of lawsuits against Vencor in various fora alleging, among other
things, various causes of action with respect to the Lenox
transactions. The Vencor Debtors have responded to these lawsuits,
and filed several counterclaims seeking compensatory and exemplary
damages and declaratory relief. The Vencor Debtors filed proofs of
claim in the Lenox chapter 11 cases in the amount of $36,586,289.
Similarly, the Lenox Debtors filed proofs of claim in the Vencor
chapter 11 cases in the amount of $17,268,535.

                          The Settlement

The Lenox Debtors filed a Settlement Motion (D.I. #1001) in the
Lenox chapter 11 cases seeking approval of a term sheet
representing a settlement agreement between the parties, which was
approved on November 27, 2000. Pursuant to a confirmation hearing
on December 4, 2000, the Lenox Plan was confirmed subject to
submittal and approval of a confirmation order. The Debtors tell
Judge Walrath that the Settlement, the result of extensive
negotiations, represents a global resolution of those disputes
along with related disputes with the Clarkes and Ventas. The Lenox
Stipulation, however, only becomes effective after Court approval
in both the Lenox Debtors' and the Vencor Debtors' chapter 11
cases.

In this motion, Vencor tells Judge Walrath that the salient terms
of the Settlement provide that:

(1) The Debtors' will be allowed an unsecured claim against the
     Lenox Debtors in the amount of $17,772,850.00 in the Lenox
     Debtors' chapter 11 cases;

(2) The Lenox Debtors' general unsecured claim will be disallowed
     and expunged in the Vencor Debtors' chapter 11 cases;

(3) The Lenox Debtors will assume a certain sublease for property
     located in Smith County, Carthage, Tennessee, and pay rent to
     Vencor according to a schedule for the total amount of
     $3,406,666 plus an effective rate of interest of 7.25% on the
     unpaid principal until the date of payment;

(4) The Lenox Debtors will assume certain other subleases and
     management agreements, and the Lenox Debtors' maintenance and
     repair obligations with respect to such subleases and
     management agreements will ride through the Lenox Plan and
     are not discharged;

(5) Vencor and Lenox agree to mutual releases.

(6) The Lenox Debtors and the Debtors dismiss with prejudice
     certain litigation and counterclaims;

(7) There will be mutual releases between the Debtors and the
     Clarkes with respect to the guarantee obligations of the
     Clarkes;

(8) The Lenox Debtors will establish and fund an escrow to
     remediate the wastewater treatment system at the facility
     known as Table Rock Residential Center in Kimberling City,
     Missouri; and

(9) Nothing in the Stipulation affects or prejudices in any way
     any of the rights or claims as between Ventas and the
     Debtors.

The Debtors submit that the proposed Stipulation, as already
approved by the Court in the Lenox chapter 11 cases, is in the
best interests of their estates, creditors and all parties
concerned. It marks the end of the many and complex disputes
between the Debtors and the Lenox Debtors.

Details of these complex disputes are not included in this motion.
However, the series of events and agreements revealed in the Lenox
cases might give some suggestion:

-- As previously reported, on or about May 1, 1998 in which
    Ventas, Inc., formerly known as Vencor, Inc. (Old Vencor),
    reorganized its corporate structure into two separate publicly
    held corporations - the newly formed entity which assumed the
    name Vencor, Inc. and the change of Old Vencor's name to
    Ventas, Inc.;

-- In connection with the Spin-off, Ventas assigned to Vencor all
    rights and interests to certain Lenox Agreements, including:

        * the Agreement of Purchase and Sale of Assets, dated
           as of November 25, 1996, as amended;
        * the Definitive Mortgage Purchase Agreement, dated
           November 5, 1996 by and between First Healthcare
           Corporation (FHC), which was merged into Ventas, Inc.
           on September 30, 1998 and Zurich North American Capital
           Corporation, one of the Lenox Debtors, the guaranty by
           Lenox Healthcare, Inc., one of the Lenox Debtors;
        * the Agreement to Purchase Mortgage Loans, dated October
           10, 1996, between FHC and Lenox Healthcare, Inc., one
           of the Lenox Debtors (the Mortgage Loan Purchase
           Agreement);
        * the Subleases and Management Agreements;
        * the Fifth Avenue Sublease;
        * the Smith County Sublease;
        * the Bartlesville Partnership Agreement;
        * the Bartlesville Management Agreement;
        * the Consent to Transfer and the Clarke Guarantees and
           all related ancilliary agreements and Vencor assumed
           and undertook certain obligations, including
           indemnification obligations;

-- a sublease was entered into between Vencor Nursing Center West,
    LLC, one of the Vencor Debtors, and Lenox Healthcare of San
    Rafael, LLC, one of the Lenox Debtors, on February 28, 1997,
    for a skilled nursing home facility known as the Fifth Avenue
    Health Care Center in San Rafael, California;

-- a sublease was entered into between Vencor Nursing Center West,
    LLC, one of the Vencor Debtors, and Greylock Health
    Corporation of Independence-Lodge, L.P., one of the Lenox
    Debtors, on January 1, 1997, for the Lodge Facility located in
    Independence, Kansas which expires by its terms on December
    10, 2000;

-- a sublease was entered into between FHC, a predecessor in
    interest with respect of Vencor Nursing Centers Limited
    Partnership, one of the Vencor Debtors, and Lenox Healthcare
    of Carthage,, LLC, one of the Lenox Debtors, in February 1997,
    for a skilled nursing home facility known as the Smith County
    Health Care Center Facility in Smith County, Tennessee;

-- a management agreement was entered into between FHC and
    Greylock \ Health of Kimberling City - Manor, L.P., one of the
    Lenox Debtors, in January 1997 for the Table Rock Health Care
    Center;

-- a management agreement was entered into between FHC and
    Greylock Health of Kimberling City - Terrace, L.P., one of the
    Lenox Debtors, in January 1997, for a residential facility
    known as the Table Rock Village;

-- a manageemnt agreement was entered into between FHC and
    Greylock Health of Crane, L.P., one of the Lenox Debtors, in
    January 1997, for a residential facility known as the Ozark
    Mountain Regional Healthcare Center;

-- on July 31, 1997, FHC and LIC-HHE Limited Partnership entered
    into the Consent to Transfer of Partnership Interest and
    Management Agreement pursuant to which LIC-HHE consented to
    the transfer of FHC's interests in the Bartlesville Nursing
    Home Partnership to Lenox Healthcare of Bartlesville, LLC, one
    of the Lenox Debtors;

-- On August 1, 1997, Lenox Bartlesville purchased FHC's interest
    in the Partnership and FHC, LICHHE and Lenox Bartlesville
    entered into the Assumption and Assignment Agreement, whereby
    FHC withdrew from the Partnership and assigned its rights
    under the partnership agreement to Lenox Bartlesville;

-- FHC also assigned its interest in the Agreement To Provide
    Management Services To A Health Care Facility, dated December
    21, 1985, to Lenox Bartlesville;

-- the Clarkes have provided guarantees in favor of the Vencor
    Debtors with respect to various obligations of the Lenox
    Debtors;

-- the Vencor Debtors have paid under the Lease Agreement between
    FHC and Smith County, Tennessee, dated June 1, 1994, in the
    amount of $3,406,666;

-- the Vencor Debtors have not yet exercised the purchase option
    provided in section 11.3 of the Smith County Lease;

-- The proofs of claim filed by Vencor in the amount of
    $36,586,289 consists of a general unsecured claim in the
    amount of $29,978,639, a secured claim in the amount of
    $6,287,265 and a priority unsecured claim in the amount of
    $320,385 and the Vencor Debtors have filed a request for
    payment of administrative expenses in the amount of $473,948,
    plus other and further monetary and nonmonetary administrative
    claims;

-- on February 28, 2000, Ventas filed proofs of claim in the Lenox
    Chapter 11 Cases, asserting, among other things, any and all
    claims, rights, and/or remedies Ventas may have for
    indemnification, contribution, reimbursement, or subrogation
    based upon or relating to the relationship of Ventas and any
    of the Lenox Debtors arising under or on account of the
    Subleases and Management Agreements, the Fifth Avenue
    Sublease, and the Smith County Sublease;

-- On October 19, 2000, Ventas also filed proofs of administrative
    expense claims arising out of the Relationship;

-- on January 7, 2000, the Lenox Debtors filed proofs of claim in
    the Vencor Chapter 11 Cases in the amount of $17,268,534 as a
    general unsecured claim;

-- prior to the Lenox Petition Date, the Lenox Debtors had
    initiated certain litigation against the Vencor Debtors styled
    Lenox Healthcare. Inc. v. Vencor. Inc. (Los Angeles County
    (Calif.) Superior Court Case No. BC 208750) and Lenox
    Healthcare. Inc. v. Vencor. Inc. (United States District Court
    (W.D. Ky.) Case No. 3:99CV-348H) and the Vencor Debtors had
    asserted certain counterclaims against the Lenox Debtors in
    such Litigation;

-- prior to the Lenox Petition Date, Ventas and Lenox were named
    parties to litigation styled as Excelsior Care Centers, Inc.
    v. Ventas, Inc. and Lenox Healthcare, Inc. Case No. 99-59,
    Circuit Court of Page County, Virginia.

(Vencor Bankruptcy News, Issue No. 22; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


VENCOR INC: Ventas Lenders Extend Vencor Plan Deadline to Mar. 31
-----------------------------------------------------------------
Ventas, Inc. (NYSE:VTR) said that it received a waiver under its
existing long term amended credit agreement extending the deadline
for the Effective Date of the Plan of Reorganization for its
primary tenant, Vencor, Inc. (OTC/BB:VCRIQ.OB).

"Obtaining this waiver gives Ventas valuable flexibility so that
we can remain focused on helping the Vencor reorganization proceed
to completion," Ventas President and CEO Debra A. Cafaro said. "It
synchronizes the terms of our credit agreement with Vencor's
announced schedule for emerging from bankruptcy, which could occur
as early as the first quarter of 2001."

Ventas' Amended Credit Agreement had contained a provision that
would have made it an event of default if the Vencor Effective
Date did not occur by December 31, 2000. The Waiver extends that
deadline until March 31, 2001. Ventas has the option to further
extend the deadline by which the Vencor Effective Date must occur
for up to three additional months through June 30, 2001. The U.S.
Bankruptcy Court has set March 1, 2001 as the confirmation hearing
date for the Vencor reorganization plan.

Key economic terms of the Waiver are:

   -- With the granting of the Waiver, Ventas has paid $35 million
       in principal under Tranche A of its loan facility, leaving
       Tranche A with a current principal balance of approximately
       $113 million.

   -- Ventas will pay an additional $15 million in principal under
       Tranche A on the earlier of March 31, 2001 or 30 days after
       the Vencor Effective Date.

   -- Ventas will pay $20 million in principal under Tranche B of
       its loan facility on the earlier of March 31, 2001 or 30
       days after the Vencor Effective Date. This $20 million
       amortization payment will be credited against the $50
       million Tranche B payment that is due on December 31, 2003.

   -- Ventas has paid a fee of approximately $220,000 to lenders
       consenting to the Waiver for the first three months of the
       Waiver. If Ventas exercises its option to continue the
       Waiver period beyond March 31, 2001, it will pay those
       lenders between $110,000 and $450,000. The actual fee will
       depend on the extension period selected by Ventas and the
       outstanding principal balance of the loans at that time.

   -- All other economic terms and conditions of the Amended
       Credit Agreement are unchanged.

If all principal payments are made by Ventas as provided in the
Waiver, then by April 2, 2001, Ventas will have de-levered by at
least $122 million since entering into the Amended Credit
Agreement, without the sale of any material assets. These payments
would leave an aggregate balance under the Amended Credit
Agreement of $851 million. The Amended Credit Agreement provides
that Ventas can elect to pay up to 80 percent of its Funds From
Operation (FFO) as an annual dividend after it has repaid a total
of $200 million under the Amended Credit Agreement.

             VENTAS DECLARES ANNUAL DIVIDEND FOR 2000

Ventas also said today that its Board of Directors declared an
annual cash dividend of $0.29 per share for 2000, payable on
January 15, 2001, to shareholders of record on December 30, 2000.
The dividend represents 95 percent of the Company's estimated
taxable net income for 2000, which is the minimum it is required
to pay in order to maintain its REIT (Real Estate Investment
Trust) status. The payment of such minimum REIT dividend is
contemplated under Ventas' Amended Credit Agreement.

"In keeping with our commitment to our shareholders, today we
declared our second annual dividend, enabling us to continue our
status as a REIT," Cafaro said. "We have made every effort to
encapsulate the extraordinary, one-time financial consequences of
Vencor's difficulties in the year now ending. Our goal is to put
these issues behind us so that we will be positioned for stable,
normalized results in 2001."

The Company's estimate of its 2000 taxable net income is dependent
on a variety of assumptions, including the date by which Vencor
emerges from bankruptcy, the effectiveness of the proposed
settlement of Medicare related investigations with the Department
of Justice (DOJ), the timing of payments to be made thereunder,
and other tax-related matters. If the Company's actual taxable net
income is determined to be greater than its current estimate,
Ventas would expect to declare an additional dividend for 2000 to
preserve its REIT status. In such event, the Company would be
subject to an excise tax, plus any applicable interest or
penalties.

Taxable net income is calculated by making a variety of
adjustments to net income determined in accordance with generally
accepted accounting principles. These adjustments depend on
various matters, including the difference between book and tax
depreciation, the periods in which certain income items are
recognized, determinations received from the Internal Revenue
Service, use of the Company's historical tax attributes and
positions, and application of various Internal Revenue Code
sections and regulations to the specific fact patterns anticipated
by the Company.

                            OUTLOOK

Ventas also said today that its taxable net income for 2001 would
likely prove substantially higher than its estimated taxable net
income for 2000 if the Vencor reorganization is completed on the
terms and the schedule currently contemplated. Accordingly, the
Company expects its 2001 dividend to be significantly greater than
its announced dividend for 2000. The Company intends to distribute
at least 90 percent of its estimated 2001 taxable net income as a
dividend. The Company's 2001 taxable income will include the value
of the 9.99% equity stake in Vencor that the Company is expected
to receive on the Vencor Effective Date.

Ventas also anticipates that it will begin to make dividend
distributions in 2001 on a normalized quarterly schedule following
Vencor's emergence from its Chapter 11 proceedings. Ventas said
that the 2001 dividend could be satisfied by the distribution of
cash and/or Vencor securities. All dividend declarations are
subject to quarterly review by the Company's Board of Directors
and restrictions contained in the Amended Credit Agreement.

There can be no assurance of the Company's ability to pay future
dividends. The Company may from time to time update its publicly
announced expectations regarding future dividends, but it is not
obligated to do so. Additionally, there can be no assurance that
Vencor will be successful in obtaining the approval of its
creditors for a restructuring plan, that any such plan will be on
terms acceptable to Ventas, Vencor and its creditors, or that any
restructuring plan will not have a material adverse effect on
Ventas. There can be no assurance that any of the court-ordered
dates in the Vencor Bankruptcy case will not change. Nor can there
be any assurance that Vencor and Ventas will be able to reach a
settlement with the DOJ, or that any such settlement will be on
terms acceptable to Ventas, or that any settlement with DOJ will
not have material adverse effect on Ventas. Ventas and other
parties to the Vencor reorganization have reserved all of their
rights regarding the proposed Vencor reorganization plan and the
confirmation process.

                           OTHER MATTERS

The Company has been informed that a financial institution is the
pledgee of a large block of the Company's common stock under a
private transaction that is not related to the Company. This
financial institution has advised the Company that it has
foreclosed on those shares and has recently sold or intends to
sell them in one or more transactions pursuant to Rule 144 under
the Securities Act of 1933, as amended. According to the financial
institution, it has sold or intends to sell approximately 675,000
shares of the Company's common stock within the three-month period
that began on December 12, 2000.

Ventas is a real estate investment trust whose properties include
45 hospitals, 216 nursing centers and eight personal care
facilities operating in 36 states.


WEST BUILDING: Seeks Chapter 11 Protection in Northern Georgia
--------------------------------------------------------------
West Building Materials of Mississippi Inc., Atlanta, Ga., has
filed Chapter 11 in the U.S. Bankruptcy Court for the Northern
District of Georgia under case number 00-74992. No schedules were
listed in the filing. In addition, West Lumber Co., West Building
Materials of North Carolina, West Building Materials of Alabama,
West Building Materials of Florida, West Building Materials of
Georgia and West Building Materials of Louisiana, all listed at
the same address, have also filed Chapter 11. Their case numbers
are 74994, 74995, 74996, 74997, 74998 and 74999 respectively. Also
at the same address and filing Chapter 11 was Associated
Distributors Inc., which listed liabilities of $11.3 million and
no assets. (New Generation Research, Inc., 20-Dec-00)


WHEELING-PITTSBURGH: Hires Calfee Halter as Local Counsel
---------------------------------------------------------
Wheeling-Pittsburgh Corporation and its debtor-affiliates
presented an Application to Judge Bodoh seeking authority to
employ James Lawniczak, Bruce J. L. Lowe, Scott N. Opincar, and
Mark I. Wallach and the law firm of Calfee, Halter & Griswold,
LLP, of Cleveland, Ohio, as local counsel in these Chapter 11
proceedings. The primary responsibilities of this firm in these
cases will be:

   (a) Advising the Debtors with respect to their powers and
duties as debtors-in-possession in the continued management and
operation of their businesses and properties, including the rights
and remedies of the Debtors with respect to their assets and with
respect to the claims of creditors;

   (b) Taking the necessary legal steps relating to negotiation,
confirmation and implementation of a plan or plans of
reorganization;

   (c) Preparing on behalf of the Debtors as debtors-in-possession
necessary applications, motions, complaints, answers, orders,
reports and other pleadings and documents;

   (d) Appearing before this Court and other officials and
tribunals and protecting the interests of the Debtors in other
jurisdictions and other proceedings; and

   (e) Performing such other legal services for the Debtors, as
debtors-in-possession, as may be necessary and appropriate.

James Lawniczak, on behalf of Calfee Halter, stated to Judge Bodoh
that neither he nor any member of the firm had any connection with
the Debtors, their creditors, any party in interest, or their
respective attorneys and accountants, except that the firm
represented the Debtors for a short time prior to the inception of
these cases in preparation for the same, and the firm also
represents certain creditors of the Debtors in matters unrelated
to these proceedings.

Specifically, Mr. Lawniczak disclosed that

The attorneys primarily appearing on behalf of the Debtors, and
their respective hourly billing rates are:

        James Lawniczak                   $ 335
        Bruce J. L. Lowe                  $ 305
        Scott N. Opincar                  $ 137
        Lawrence N. Schultz               $ 345
        Mark I. Wallach                   $ 340
        Gregory Dziak (Legal assistant)   $ 135

Other attorneys and legal assistants may from time to time render
services to the Debtors in connection with these cases as well.

The billing rates of other attorneys and paralegals that may work
on these cases are currently $240 to $395 per hour for partners,
$128 to $235 for associates, and $100 to $158 for legal
assistants.

Mr. Lawniczak disclosed that the firm first began work for the
Debtors on November 10, 2000, and has received a cash retainer
from the Debtors of $100,000 which will be applied in part to any
unpaid prepetition charges. In addition, the firm received the sum
of $7500 for filing fees in these cases.

Mr. Lawniczak further disclosed that the firm had performed work
for certain creditors of the Debtors, such as Ohio Department of
Development in connection with a potential bond issuance to
Wheeling Pittsburgh which was not completed, and with a similar
transaction on behalf of the Ohio Department of Development to
Ohio Coatings Co., an entity in which the Debtors have a 50%
equity interest, but which is not itself a debtor. The firm also
represents OCC in litigation with Unisor Steel Corp., and received
a retainer of $10,000 from Wheeling Pittsburgh Steel Corp. for the
benefit of OCC which is reflected in an intercompany account.

The firm has also worked with Jay Alix and Associates on several
projects, and has performed legal services for Pricewaterhouse
Coopers LLP as receiver. The firm currently represents Bank One
Capital Markets as underwriter's counsel in two bond transactions,
and in other now concluded matters. The firm has represented other
creditors in the past, such as Crestar Bank and Citicorp
Securities. None of these representations, or other matters
disclosed by Mr. Lawniczak on behalf of the firm, have any
relation to the Debtors or these proceedings.

After review of these disclosures of representation and fees,
Judge Bodoh entered an Order authorizing Calfee, Halter &
Griswold, LLP to act as local counsel for the Debtors in these
cases. (Wheeling-Pittsburgh Bankruptcy News, Issue No. 3;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


WINN-DIXIE: Moody's Places Ratings on Review for Downgrade
-----------------------------------------------------------
Moody's Investors Service placed the ratings of Winn-Dixie Stores,
Inc. on review for possible downgrade based on concerns about the
competitive challenges to the company's business and weaker
financial flexibility relative to its peers. Moody's review will
focus on Winn-Dixie's progress in improving its operating
performance, as well as the company's plans to fund capital
expenditures and discretionary spending such as store acquisitions
and dividends.

Ratings placed on review for possible downgrade:

   a) Long term issuer rating at Baa3.

   b) Commercial paper at Prime-3.

While Winn-Dixie has a major supermarket franchise in the vibrant
south and southeastern United States, consolidated revenue growth
has been poor because the favorable population demographics of the
southeastern region have attracted persistent and intense
competition. In addition, Winn-Dixie's strategies and execution,
and their prior store prototype, were not effective in countering
this strong competition. The company's identical store sales have
been negative for the past three fiscal years, and fell again in
the first fiscal quarter ended September 20, 2000, dropping 3.2%.
Operating margin (before restructuring and other non-recurring
charges) for the fiscal year ending June 30, 2000, at only one
percent, trailed some of the company's competitors'. A major
initiative to reverse these trends is the retrofitting of
approximately 60% of the Winn-Dixie store base by the end of he
current fiscal year.

The company's financial policy during this time of challenged
performance remains aggressive. Winn-Dixie repurchased over $162
million of stock and paid dividends of nearly $149 million during
the recently ended fiscal year, and another $16.9 million and
$24.5 million respectively in the first fiscal quarter. A short
term debt increase in the first quarter funded these expenditures,
capital spending and negative cash flow from operations. Moody's
notes that the company has significant off balance sheet
contingent liabilities, primarily store leases and a synthetic
lease.

Headquartered in Florida, Winn-Dixie Stores, Inc. operates about
1079 supermarkets in the south, southeast, Midwestern United
States and the Bahamas.



* BOOK REVIEW: Transcontinental Railway Strategy, 1869-1893: A
               Study of Businessmen
--------------------------------------------------------------
Author: Julius Grodinsky
Publisher: Beard Books
Softcover: 439 Pages
List Price: $34.95
Order a copy today from Amazon.com at
http://www.amazon.com/exec/obidos/ASIN/1587980037/internetbankrupt

Review by Gail Owens Hoelscher

Railroads were pioneers of the American frontier.  Union Pacific;
Central Pacific; Kansas and Pacific; Chicago, Rock Island and
Pacific; Chicago, Burlington and Quincy; Atchison, Topeka and
Santa Fe: These names evoke boom times in America, the excitement
and tumult of seemingly limitless growth and opportunity,
frontiers to tame, fortunes to be made.  Railroads opened up vast
supplies of raw materials, agricultural products, metals, and
lumber.  The public gain was incalculable: job creation, low-cost
transportation, acceleration of westward immigration, and
settlement of the frontier.

The building of the western railway system in the United States
was described at the time as "one of the greatest industrial feats
in the world's history."  This book tells the story of the
trailblazers of the Western railway industry, men with a stalwart
willingness to take on extraordinary personal financial risk.  As
a group, these initial railroad promoters were smart, bold,
tenacious, innovative, and fiercely competitive.  Some were
cautious with their and their investors' money, some reckless.  
Most met with financial setbacks, some with total failure, some
time and time again.  They often sold out at great losses, leaving
their successors to derive the benefits later.

Bitter competition existed among these men.  They fought to
position their "roads" in a limited number of mountain passes,
rivers, and valleys; and to chart routes which connected major
production areas with major consumption areas.  They cajoled and
begged almost anyone for capital.  They created and tried to
defend monopolies.  They bullied each other, invaded each other's
territories, and retaliated against each other.  They staged wage
wars.  They agreed not to compete with each other, and bought each
other out.

The book opens in May of 1869, just after the completion of the
first transcontinental route joining the Union Pacific Railroad
and the Central Pacific Railroad in Ogden, Utah.  The companies'
long-term prospects were excellent, but right then they were
desperate for cash.  Union Pacific alone was more than $15 million
in debt.  Additional financing was proving scarce.  By 1870, more
than 40 railroads were floating bonds, "at almost any price for
ready cash," wrote one contemporary observer.  Still, funds were
raised and construction went on, both of transcontinental lines
and branch lines.

As railway lines in the West were built in relatively unsettled
areas, traffic was light and returns correspondingly low.  To
increase business, the companies found ways to encourage
population growth along their routes.  Much needed funding came
from immigration services set up by the railways themselves.  
Agricultural areas sprang up along the routes.  Sometimes volume
of traffic expanded too fast, and equipment shortage and
construction delays occurred.  Or, drought, recession, and low
agricultural prices meant more red ink.

This book takes the reader through the boom times and bust times
of the greatest growth of railways the world has ever seen.  The
author uses a myriad of sources showing painstaking and creative
researches, including contemporary news accounts; railway company
financial records and archives; contemporary industry journals;
Congressional records; and personal papers, letters, memories and
biographies of the main players.

It's a good, solid read.

                           *********

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
conferences@bankrupt.com.

Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals. All titles available
from Amazon.com -- go to
http://www.amazon.com/exec/obidos/ASIN/189312214X/internetbankrupt
-- 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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