TCR_Public/010123.MBX         T R O U B L E D   C O M P A N Y   R E P O R T E R

            Tuesday, January 23, 2001, Vol. 5, No. 16

                           Headlines

ARMSTRONG HOLDINGS: Employs Womble as Product Liability Counsel
ARYAN NATION: Property Auctioned to Pay $6.3 Million Judgment
CALIFORNIA POWER: To Close Doors Due to the Power Crisis
DRIGGS CORP.: Files for Bankruptcy Protection in Maryland
EDWARDS THEATRES: Assumes Entertainment Properties' Leases

FRD ACQUISITION: Moody's Downgrades Senior Notes To Caa3
FRUIT OF THE LOOM: Requests Extension of Rule 9027 Removal Period
HIT OR MISS: Walking Away from 10 More Burdensome Leases
ICG COMMUNICATIONS: Existing Cash Management System Maintained
INTRENET INC.: Files for Chapter 11 Protection in Ohio

LERNOUT & HAUSPIE: Noteholders Move to Appoint an Examiner
LERNOUT & HAUSPIE: AllVoice Can Proceed with Patent Litigation
LETSBUYIT.COM: Trustees Slam Management
LOEWEN GROUP: GE Capital Presses for Decision on Leases
LTV CORPORATION: Seeks Okay to Pay Critical Vendors & Suppliers

MASTER GRAPHICS: Stephenson Asset Sale Hearing Set for Thursday
MONEY'S FINANCIAL: Committee Taps Glass & Assoc. as Consultant
OPTICARE HEALTH: Shareholders Extend Secured Bridge Financing
OWENS CORNING: Enters into New Contract with Elk Corporation
PACIFIC GAS: S&P Lowers Related Issues to CC

PACIFIC GAS: Lenders Treat Utility Like a "Deadbeat Borrower"
PACIFIC GAS: Responds to Action by California Attorney General
PACIFIC GATEWAY: Wins Interim Okay to Borrow Under DIP Loan
SABRATEK CORP: Wants Exclusivity Extension through Jan. 29
SOUTHERN CALIFORNIA: Green Power Suppliers to Suspend Service

STELLEX TECHNOLOGIES: Court to Review Exclusivity on Thursday
SUN HEALTHCARE: Rejects Certain Equipment Leases
TEAR DROP: Creditors to Convene for 341 Meeting on Feb. 2
TRI-VALLEY: Plan Calls for Break-Up Among Four Buyers
VENCOR INC.: Selects Cyberview to Enhance Level of Data Analysis

VISION METALS: Hires PricewaterhouseCoopers as Financial Advisors
VISION METALS: Committee Selects Lowenstein Sandler as Counsel
WHEELING-PITTSBURGH: Bluestone Wants Supply Contract Decision Now

                           *********

ARMSTRONG HOLDINGS: Employs Womble as Product Liability Counsel
---------------------------------------------------------------
Armstrong Holdings, Inc., and its debtor-affiliates ask Judge
Farnan for an Order authorizing their employment of the law firm
of Womble, Carlyle, Sandridge & Rice PLLC of Winston-Salem, North
Carolina, as special counsel for business law and non-products
liability litigation.

The Debtors wish to employ the firm to provide services relating
to:

     (a) Antitrust and trade regulation litigation, advice and
compliance;

     (b) Environmental litigation, advice and compliance;

     (c) Creditors' rights;

     (d) Distribution, marketing and advertising litigation,
advice and compliance;

     (e) Prosecution, registration, licensing, litigation,, and
advice regarding patents, trademarks, copyrights, trade secrets
and other intellectual property;

     (f) Employment litigation, advice and compliance;

     (g) Litigation of all manner and kind, other than that
pertaining to asbestos and other product liability claims;

     (h) Contract negotiation, drafting and advice of all manner
and kind, other than employment contracts and collective
bargaining agreements; and

     (i) Preparing for, attending and participating in meetings,
and appearing before the Court, as may be requested by the
Debtors and their bankruptcy counsel.

Mark N. Poovey, Esq., a member of the firm, assures the Court
that the firm neither holds nor represents any interest adverse
to these bankruptcy estates or the Debtors in the matters for
which approval of employment is sought. However, Mr. Poovey
discloses that the firm has provided services to certain
creditors, underwriters, and lenders to the Debtors.
Specifically, the firm has represented AT&T, Air Products &
Chemicals, American Express, Bank One, Bank of America, Bayer
Corporation, Chase Manhattan Bank, Deutsche Bank AG, Farm Bureau
Life Insurance Company, and others, but not in any matters
connected with or relating to the administration of these Chapter
11 cases.

In the year before the Petition Date, the Debtors paid Womble
Carlyle $3,255,131.34 for fees and costs. In anticipation of
these filings, the Debtors also paid the firm $207,277 to cover
the period between November 15 and the Petition Date. In the
event that, after application of the fees and expenses earned
prior to the Petition Date, any balance remains it will either be
refunded or retained against post-petition services if the
Application for employment is granted.

Womble Carlyle's current customary hourly rates, while subject to
change from time to time, are $200 to $425 for partners, $115 to
$225 for associates, and $55 to $115 for paraprofessionals.
Because of its long-standing relationship with the Debtors, the
firm discounts its customary hourly rates to the Debtors by
fifteen percent for Mark N. Poovey and ten percent for other
professionals. (Armstrong Bankruptcy News, Issue No. 3;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


ARYAN NATION: Property Auctioned to Pay $6.3 Million Judgment
-------------------------------------------------------------
The successful bidder for the Aryan Nation's property next month
will get more than the 20-acre neo-Nazi compound, according to
the Associated Press. The compound, located in Coeur D'Alene,
Idaho, and all its contents will be sold to one bidder at the
Feb. 13 auction. The property will be sold by chapter 7 trustee
and past ABI president Ford Elsaesser and is listed on the joint
ABI/National Association of Bankruptcy Trustees web site,
bankruptcysales.com. The deal includes Nazi paraphernalia that
represents the life work of Aryan Nation's founder Richard
Butler, who lost a $6.3 million civil lawsuit last year and must
sell the compound to pay part of his bankruptcy judgment. The
buyer will also get the rights to the names "Aryan Nation" and
"Church of Jesus Christ Christian." Butler filed for bankruptcy
protection on Oct. 30. (ABI World, January 19, 2001)


CALIFORNIA POWER: To Close Doors Due to the Power Crisis
-----------------------------------------------------
Late last week The California Power Exchange announced it will
close its doors as a result of the California power crisis.
CalPX, Reuters relates, ran the market that allowed the state's
investor owned utilities to buy electricity and is the first
casualty of an electricity price crisis that has spiraled out of
control.

"Today, CalPX finds itself immersed in a situation not of our
making. The damage the markets have suffered has caused us to no
longer be able to deliver the services we so well performed,"
CalPX said.   

CalPX was launched in March 1998 under California's trailblazing
deregulation legislation, Nigel Hunt, writing for Reuters
explains. It was designed to bring more openness to electricity
trading, which has traditionally been conducted out of public
view.

"While we begin the orderly transition out of this market, CalPX
remains proud of the light it has shed on an industry that had
been previously regulated in virtual secrecy for over 125 years,"
said President and Chief Executive Officer George Sladoje.  But
as the state's free market experiment started to fall apart, the
exchange face considerable criticism from federal regulators who
believed that utilities purchased too much of their power though
CalPX's day-ahead market and should instead be signing long-term
deals with producers, Reuters says.


DRIGGS CORP.: Files for Bankruptcy Protection in Maryland
---------------------------------------------------------
The contractor building a seven-mile section of the Chesapeake
Expressway in Virginia filed for protection from creditors in
bankruptcy court, but that should not delay the long-awaited
project's completion, the contractor and city said. The
contractor -- The Driggs Corp. -- said work on the project will
continue and the road should be finished this summer, according
to the Associated Press. In the past few months, Driggs fell
behind on payments to its subcontractors, forcing it to file for
bankruptcy reorganization in Maryland, said attorney Lawrence
Coppel. Coppel said the company's bonding agent has agreed to
advance Driggs the money it needs to pay its subcontractors and
to continue work.

"No one should see any interruption in their work or in the
payment of suppliers and subcontractors as a result of this
case," said Coppel. Driggs will present its plan in bankruptcy
court today in Greenbelt, Md. City officials said they would
monitor the bankruptcy proceedings. Patricia C. Biegler, director
of the Public Works Department, said she didn't believe the
chapter 11 filing would have any impact on the Route 168 project.
(ABI World, January 19, 2001)


EDWARDS THEATRES: Assumes Entertainment Properties' Leases
----------------------------------------------------------
Entertainment Properties Trust (NYSE:EPR) announced that the
United States Bankruptcy Court for the Central District of
California, Santa Ana Division granted the motion for the
assumption of the Aliso Viejo, Calif., and Boise, Idaho, megaplex
theatres on January 18, 2001.

The megaplex theatres, located in Aliso Viejo, Calif., and Boise,
Idaho, were purchased by EPR in a 1998 sale/leaseback transaction
with Edwards Theatres. Both theatres were ranked in the top 75
highest-grossing theatres in the United States for the year 2000.
"We are pleased to announce final resolution of this matter
consistent with our expectations. This resolution reflects the
strength of the financial performance and cross default
characteristics of which we have spoken," said David Brain, CEO
of Entertainment Properties Trust.

Edwards Theatres filed for protection under Chapter 11 bankruptcy
on August 23, 2000. All rents due to EPR under the terms of the
leases have been paid throughout the bankruptcy proceedings.

Since becoming publicly traded in November of 1997, EPR has
acquired more than $500 million in theatre and related properties
throughout the United States which are operated by such first-run
movie exhibitors as AMC Entertainment, Loews Cineplex
Entertainment, Muvico Entertainment, Edwards Theatres and
Consolidated Theatres.

Entertainment Properties Trust is a specialty finance company
organized as a real estate investment trust (REIT) whose
principal business strategy is to acquire and develop a
diversified portfolio of high-quality properties leased to major
entertainment-related business operators. The Company's
common shares of beneficial interest are traded on the New York
Stock Exchange under the ticker symbol EPR.


FRD ACQUISITION: Moody's Downgrades Senior Notes To Caa3
--------------------------------------------------------
Moody's Investors service lowered the rating on the $156.9
million 12.5% senior unsecured notes of FRD Acquisition Co., due
2004, to Caa3 from Caa1.  The company is a wholly-owned
subsidiary of Advantica Restaurant Group, Inc.

Moodys' also confirmed the ratings of Advantica Restaurant Group,
Inc. as follows:
     
     (a) the rating of the $200.0 million bank revolving credit
         facility due 2008 at B1;
     
     (b) the rating of the $529.6 million 11.25% senior unsecured
         notes, due 2008 at B3;
     
     (c) the senior implied rating at B2; and
    
     (d) the issuer rating at B3.  

The outlook was revised to negative.

Moody's said the rating action was prompted by the decision to
delay the scheduled $9.8 million interest payment on FRD's senior
unsecured notes, continued poor operating performance at Coco's
and Carrow's (the two concepts that comprise FRD), and
Advantica's assumption of the (unrated) FRD $70 million credit
facility. Advantica, as guarantor of the FRD credit facility,
repaid the banks that granted the credit facility and became the
senior secured lender on January 8, 2001. However, Advantica does
not guarantee FRD's senior unsecured notes or other obligations.
According to Moody's, in a default scenario, Advantica likely
would achieve full recovery from the secured credit facility owed
by FRD, but the senior unsecured noteholders of FRD would suffer
a material loss.

Moody's ratings on the FRD senior notes reflect:

     (a) the probability that the company may default by not
         making the interest payment within the 30 day grace
         period;

     (b) the unresolved operating problems at Coco's and
         Carrow's; and
     
     (c) the loss likely to occur as part of the reorganization    
         process.

Advantica's ratings are supported by the modest operating
improvements at Denny's, Denny's name recognition and geographic
diversity, and the belief that Advantica has no contingent
responsibility for FRD's obligations.

The B1 bank facility rating incorporates the security of the
company's cash, accounts receivable, intangible assets, and
equity stakes and guarantees of Advantica's subsidiaries. The B3
rating on the senior unsecured notes (due 2008) considers that
these are structurally subordinate to significant amounts of
senior secured debt including the bank facility. The Caa3 rating
on the senior notes (due 2004) issued by FRD considers that,
while these are guaranteed by FRD's operating subsidiaries,
Advantica does not guarantee these notes, FRD has $70 million of
senior secured debt, and the default loss is likely to be
substantial, Moody's report.

With the negative outlook, Moody's states that ratings could
decline over the intermediate term if Denny's does not continue
making progress or if Advantica does not fully recover the FRD
credit facility in a timely manner.

After assuming the FRD loan, Moody's estimates that Advantica
currently has at least $50 million remaining available on the
revolving credit facility. Assuming complete recovery of the $70
million loan to FRD, Moody's believes that Advantica has adequate
liquidity resources over the longer term to accommodate normal
working capital fluctuation and to continue the remodel program
at Denny's. However, write-off of a significant portion of the
FRD loan (in addition to the expected charge-off of accrued
management fees payable) would restrict Advantica's flexibility
in developing the Denny's concept.

The performance of Coco's and Carrow's has consistently decline
over the past three years despite attempts to improve service,
modify the menu, and lightly remodel stores. This was measured in
terms of margins and comparable store sales. For the twelve
months ending September 2000, adjusted debt to EBITDAR for FRD
equaled 6.6 times. EBITDA covered interest expense 1.5 times but
was not sufficient to also cover capital expenditures. FRD had $1
million in cash and revolving credit availability of $12 million.
Moody's expect that reorganization value for FRD will be reduced
because of Coco's and Carrow's unresolved operating problems and
the necessity to revamp the entire store base.

Advantica Restaurant Group, Inc, headquartered in Spartanburg,
South Carolina, operates or franchises 1816 Denny's restaurants
and, through its FRD Acquisition Co. subsidiary, 480 Coco's and
144 Carrow's restaurants.


FRUIT OF THE LOOM: Requests Extension of Rule 9027 Removal Period
-----------------------------------------------------------------
Before the petition date, Fruit of the Loom, Ltd. was party to
numerous civil actions pending in multiple fora. These lawsuits
assert a wide variety of claims. At the Debtors' behest, Judge
Walsh granted Fruit of the Loom a third extension of the deadline
by which it must decide whether it wants to transfer those
lawsuits to the District of Delaware for continued litigation.
The new deadline advances the time to file removal notices 270
days through and including the later of September 17, 2001 or
thirty days after the entry of an order terminating the automatic
stay with respect to the particular civil action sought to be
removed.

Kate Stickles Esq., says Fruit of the Loom must evaluate many
issues in determining whether to request removal of any
particular prepetition action. At this juncture, Fruit of the
Loom has not had ample time to determine which prepetition
actions it will seek to remove. Rather, management has been
occupied with bankruptcy related matters, including business
stabilization and the formulation of a long-term business plan.
It is presently engaged in the difficult task of formulating and
negotiating a plan of reorganization. Ms. Stickles reminds the
Court that the exclusivity period gives Fruit of the Loom until
March 31, 2001, to file the plan. Assuming that a plan is filed
on or before that date, the confirmation process is likely to
take some time, considering the wide dispersal of Fruit of the
Loom's creditors, including its holders of public debt.

Without the requested extension, Fruit of the Loom says it may be
forced to make removal decisions prematurely. The extension
ensures that Fruit of the Loom has the time needed to make fully
informed decisions concerning removal of prepetition actions and
that management does not forfeit valuable rights under 28 U.S.C.
Section 1452.

Ms. Stickles relies on Pacor Inc., v. Higgins, 743 F. 2d 984, 996
n.17 (3rd Cir. 1984), which held that under Bankruptcy Rule
9006(b), "it is clear that the court may grant such an extension
of time to remove." (Fruit of the Loom Bankruptcy News, Issue No.
20; Bankruptcy Creditors' Service, Inc., 609/392-0900)



HIT OR MISS: Walking Away from 10 More Burdensome Leases
--------------------------------------------------------
Hit or Miss, Inc. seeks court authority to reject certain
unexpired leases of nonresidential real property.

A hearing will be held on January 29, 2001 at 10:00 AM before the
Honorable Novalyn L. Winfield, U.S. Bankruptcy Court, Newark, NJ

To date, the Debtor has rejected 59 real property leases. The
debtor now seeks to reject ten additional commercial real
property leases and to surrender possession of the stores
relating to the leases by January 31, 2001.

The properties are located in New York, Illinois, Massachusetts,
Virginia, Pennsylvania, Mississippi, Texas and Michigan.


ICG COMMUNICATIONS: Existing Cash Management System Maintained
--------------------------------------------------------------
ICG Communications, Inc. presented a Motion to the Bankruptcy
Court seeking authority to maintain and continue using the
Debtors' existing bank accounts, business forms, and cash
management system, and granting superpriority claim status to all
postpetition intercompany claims. The United States Trustee has
established operating guidelines for debtors-in- possession who
continue to operate their businesses. These guidelines require
Chapter 11 debtors-in-possession to, among other things, close
all existing pre-petition bank accounts and open new, post-
petition bank accounts. This requirement is designed to provide a
clear line of demarcation between pre-petition and post-petition
transactions and operations, and to help prevent an inadvertent
post-petition payment of a pre-petition claim by preventing banks
from honoring checks drawn prior to the filing of the petition.

Before the Petition Date, the Debtors, in the ordinary course of
their business, maintained a variety of bank accounts including,
but not limited to, payroll accounts, concentration accounts, and
operating accounts. To guard against improper transfers resulting
from the post- petition honoring of pre-petition checks, the
Debtors propose that, with limited court-approved exceptions, the
banks named not honor any checks drawn on these accounts prior to
the commencement of the case. The Debtors also asked that these
accounts be deemed debtor-in-possession accounts, and that the
Debtors be authorized to continue use of these accounts without
the appellation of "Debtor in Possession".

To minimize the expenses to these estates, the Debtors also asked
that they be authorized to continue to use all correspondence,
business forms, including letterhead, purchase orders and
invoices, and checks existing immediately prior to the Petition
Date without reference to the Debtors' status as debtors-in-
possession. The Debtors urged that parties doing business with
them would undoubtedly be aware, as a result of the size of these
cases, of the Debtors' bankruptcy status. Changing correspondence
and business forms would therefore be unnecessary, burdensome to
the Debtors' estates, expensive, and disruptive to business
operations.

Finally, the Debtors asked for authority to continue to use their
cash management system for all its business operations. Requiring
the Debtors to adopt a new cash management system at this
critical stage of these cases would be expensive, create
unnecessary administrative problems, and be much more disruptive
than productive. The practices employed by the Debtors in
administering the cash management system constitute ordinary,
usual and essential business practices. Funds move quickly and
efficiently, ensuring their availability. To avoid a disruption
in the ordinary and usual conduct of the Debtors' financial
affairs and cash management, the Debtors argued that it was
essential that they be permitted to continue these practices, and
the requested relief was granted.

Upon consideration of this Motion, the Bankruptcy Court
authorized the Debtors to continue to use their existing cash
management system and continue to engage in intercompany
transactions; provided, however, that the Debtors were ordered to
maintain strict records of all transfers so that all
transactions, including, but not limited to,, intercompany
transactions, may be readily ascertained, traced and recorded
properly on applicable accounts. The Court further authorized the
Debtors to use their existing bank accounts, and directed the
banks at which these accounts were located to continue to service
and administer the accounts of the respective Debtor as a debtor-
in-possession without interruption and in the usual and ordinary
course.

The Court further ordered that all intercompany claims between
and among the Debtors arising after the Petition Date were
accorded priority over any and all administrative expenses,
subject and subordinate to the priorities, liens, claims and
security interests granted under the DIP Facility or any order
authorizing adequate protection to the prepetition secured
lenders to the Services Debtors. (ICG Communications Bankruptcy
News, Issue No. 3; Bankruptcy Creditors' Service, Inc., 609/392-
0900)


INTRENET INC.: Files for Chapter 11 Protection in Ohio
------------------------------------------------------
Intrenet Inc. filed for chapter 11 protection in the U.S.
Bankruptcy Court for the Southern District of Ohio. The company's
operating subsidiaries, Advanced Distribution Systems Inc., Eck
Miller Transportation Corp., Roadrunner Trucking Inc., INET
Logistics Inc., and Roadrunner Distribution Services Inc. also
filed separate chapter 11 petitions. "The filing of the chapter
11 petition was a necessary and expected step," said Thomas J.
Noonan Jr., chairman of the board, president and chief executive
officer.  The Milford, Ohio-based company has reached an
agreement with The Huntington National Bank, the lender under
Intrenet's existing working capital credit facility, for limited
use of cash collateral to fund the liquidation. (ABI World,
January 19, 2001)


LERNOUT & HAUSPIE: Noteholders Move to Appoint an Examiner
----------------------------------------------------------
Conseco Capital Management, Inc., Magten Asset Management
Corporation, and Freen & Smith Investment Management LLC, holders
of Dictaphone Corporation 11-3/4% Senior Subordinated Notes due
2005, represented by Bruce R. Zirinsky, Esq., and Gregory M.
Petrick, Esq., at Calwalader, Wickersham & Taft in New York, move
for an Order appointing an examiner in the Dictaphone Chapter 11
case with expanded powers to investigate and report as to:

      (a) The validity and enforceability of any intercompany
claims or guarantees of affiliates' indebtedness or obligations
to third parties, and any defenses thereto, including by way of
offset, counterclaim, or equitable subordination;

      (b) The existence of claims of Dictaphone and its
creditors, including holders of publicly traded securities of
Dictaphone, for damages against L&H, its affiliates and third
parties based upon, related to, or arising out of fraud,
misrepresentation, concealment, mismanagement, breach of duty, or
otherwise;

      (c) The advisability and feasibility of having a separate
plan of reorganization for Dictaphone, including a possible sale
of the company as a going concern;

      (d) The advisability and appropriateness of appointing a
Chapter 11 trustee in the Dictaphone case;

      (e) Whether and if so, to what extent and in what manner,
the Dictaphone estate should be represented in any foreign
proceedings concerning L&H or its affiliates; and

      (f) Such other matters as the Court may deem appropriate.

The moving creditors tell Judge Judith Wizmur that in April 2000
Dictaphone was an independent, financially stable company.  It
was purchased by Lernout & Hauspie Speech Products N.V. in May,
2000, and less than six months later Dictaphone finds itself in
Chapter 11.  L&H, which, the Committee noted, had been touted as
the "Microsoft of Europe", faces a wave of lawsuits and
regulatory actions and investigations based on alleged fraud and
accounting irregularities.  The movants assert that, in the wake
of these actions, L&H seized upon its recently-acquired United
States subsidiaries, such as Dictaphone, and their valuable
assets as a means by which to seek relief in the Bankruptcy Court
and to fund L&H's crippled operations.  Before any further damage
is done to the Dictaphone estate, the moving parties seek the
appointment of an examiner to investigate and pursue the various
claims that Dictaphone and its creditors may have against L&H.

Since the commencement of these Chapter 11 cases, Dictaphone's
creditors have been barraged with disclosures relating to
allegations of fraud, accounting irregularities, conspiracies to
inflate revenues, and recalcitrance by L&H management to provide
relevant information. Despite the bankruptcy philosophy that
Chapter 11 should be a "transparent" process, creditors' main
sources of information in these cases has been newspaper reports,
from which reports have emerged that a law firm and accounting
firm hired by L&H determined that L&H may have engaged in
fraudulent practices, that L&H improperly recognized income from
start-up companies which resulted in a gross inflation of the
company's results, and that hundreds of millions of dollars have
"disappeared" into L&H subsidiaries around the world.  Because of
what the moving parties claimed was L&H's attempts to consolidate
the assets of these estates, and the appointment of a single
creditors' committee which the moving parties say is heavily
weighted in favor of L&H creditors, and the joint administration
of these cases, Dictaphone creditors have been left with no
effective official representation in these proceedings.  Without
the appointment of an independent fiduciary to safeguard
Dictaphone's interests, valuable claims and rights may be
lost.

The moving parties also direct the Court's attention to what they
characterized as "L&H's tangled web of allegedly disappearing
money, accounting irregularities, purported upstream guarantees
and transfers between affiliates", which the moving parties claim
characterize almost all of the bases upon which courts have
appointed examiners.  The moving parties further alleged that
from the onset of these cases L&H's counsel and financial
advisors are inherently conflicted on the major issues in these
cases and cannot adequately investigate the intercompany
relationships involving in these proceedings.  Further, the
composition of the Official Creditors' Committee, which includes
six creditors with direct claims against L&H and indirect claims
against Dictaphone, is said by the movants to make investigation
of the intercompany issues by the Committee unlikely, as these
very same creditors are beneficiaries of those intercompany
obligations.  Finally, the movants stated that the companies
themselves have refused to give the movants the most basic
information about the intercompany relationships, thus precluding
the movants from performing their own investigation.  The movants
concluded that without an impartial, court-appointed fiduciary to
investigate these issues, L&H's continued secrecy will
irreparably harm Dictaphone's creditors. (L&H/Dictaphone
Bankruptcy News, Issue No. 3; Bankruptcy Creditors' Service,
Inc., 609/392-0900)


LERNOUT & HAUSPIE: AllVoice Can Proceed with Patent Litigation
--------------------------------------------------------------
A British software maker won the right to proceed against
troubled Belgian technology company Lernout & Hauspie Speech
Products NV (L&H) with U.S. patent infringement litigation
involving a leading L&H product, according to Reuters.  U.S.
Bankruptcy Judge Judith Wizmur agreed that AllVoice Computing PLC
should be able to seek a preliminary injunction to stop L&H from
selling a voice recognition software product called
NaturallySpeaking.

AllVoice attorneys said the judge granted the British company
relief from an automatic bankruptcy court stay that had prevented
it from pushing ahead with two patent-infringement lawsuits in
Massachusetts, one in a U.S. district court and another at the
First U.S. Circuit Court of Appeals. Both lawsuits have been
filed and a federal judge has denied AllVoice's request for an
injunction in the case now at the appellate level. Wizmur's
decision came as a blow to L&H attorneys who had advised the
judge that NaturallySpeaking was a mainstay of L&H's stable of
products worth $50 million in annual revenues and would affect
the bankruptcy court reorganization if subject to injunction.
(ABI World, January 19, 2001)


LETSBUYIT.COM: Trustees Slam Management
---------------------------------------
Stricken Internet retailer LetsBuyIt.com virtually vanished from
the stock market on Thursday as management said it would fight
bankruptcy and trustees described the firm's administration as
"deplorable," according to a Reuters report.  A statement from
legal firm Van Doorne, appointed as trustees for LetsBuyIt.com
debt moratorium, said LetsBuyIt would oppose Van Doorne's own
application for LetsBuyIt's bankruptcy. "The present management
still sees chances for survival and has indicated it will put
forward a defense," Van Doorne said.

The trustees also released a report on the management of the UK-
based company, branding it "deplorable" and "a chaos," and citing
board-level bickering as one key factor behind the company's
troubles. If Letsbuyit is declared bankrupt, it will leave a
string of high-profile creditors empty-handed. Van Doorne said
Letsbuyit's largest creditor was U.S. technology support company
Sykes, owed a total of 7.5 million euros. Other major creditors
include Hewlett Packard, Icon Media and WinEasy, as well as
several marketing and hardware companies. (ABI World, January 19,
2001)


LOEWEN GROUP: GE Capital Presses for Decision on Leases
-------------------------------------------------------
GE Capital Modular Space, a division of Transport International
Pool, Inc. asks the Court to compel The Loewen Group, Inc. to
assume or reject certain unexpired Master Lease Agreements
between the Debtors and GE Capital and to pay all past due and
future post-petition payments to GE Capital until the Leases are
assumed or rejected.

GE tells the Court that, pre-petition, the Debtors leased
Equipment from GE Capital pursuant to certain leases between the
parties. After the commencement of the chapter 11 cases, GE
Capital has not received rental payments due under the Leases
from the Debtors for various time periods.

In GE's estimate, there is currently due and owing to GE Capital
a total of $80,195 under the Leases.

GE Capital is informed and believes that the Debtors are using
the Equipment in the operation of its business. (Loewen
Bankruptcy News, Issue No. 32; Bankruptcy Creditors' Service,
Inc., 609/392-0900)


LTV CORPORATION: Seeks Okay to Pay Critical Vendors & Suppliers
---------------------------------------------------------------
The LTV Corporation sought and obtained Judge Bodoh's
authorization to pay the prepetition claims of certain critical
vendors and service providers.  These claims are:

     * Processor and Warehouse Claims approximating $8,500,000.  
In connection with the day-to-day operation of their businesses,
the Debtors rely on certain outside processors and converters
that (a) receive work in process from the Debtors, (b) perform
processing necessary to finish the Debtors' products to the
Debtors' specifications, and (c) in some cases, ship the
processed materials or finished products to the Debtors or their
customers.  The Debtors also store both finished products and raw
materials, work in process, and supplies used in the Debtors'
manufacturing operations at a variety of third-party warehouse
facilities which typically are located near the Debtors'
manufacturing facilities or at key distribution points for
customer deliveries.  As a result, the processors and warehouses
have possession of the Debtors' materials or products in the
ordinary course of their businesses.  As of the Petition Date,
many of the processors and warehouses had claims for goods and
services previously provided to the Debtors.  

     * Shipping Claims approximating $16,000,000.  In connection
with the operation of their businesses, the Debtors also rely on
certain shippers, including trucking companies, railroads, and
barge operators to transport materials and work in process among
the Debtors' manufacturing facilities and to complete the
delivery of finished goods to the Debtors' customers.  On the
Petition Date, certain of the shippers had outstanding claims for
services previously provided to the Debtors.  Shipments are made
typically on a "just in time" basis, so disruptions from any
delay would have an immediate and adverse effect on the Debtors'
businesses.  

     * Regulatory Compliance Claims approximating $2,000,000.  In
the ordinary course of their businesses, the Debtors rely on a
number of service providers to assist the Debtors in complying
with environmental and other governmental laws and regulations.  
For example, the Debtors employ certain hazardous waste disposal
companies that remove a variety of hazardous substances from the
Debtors' facilities for proper disposal.  AS of the Petition
Date, certain regulatory compliance vendors had outstanding
claims for services previously provided to the Debtors.  If these
claims are not paid, certain of these vendors may refuse to
perform postpetition services for the Debtors, or may delay
performance for a period of time.  Any disruption in the
availability of the regulatory compliance vendors' services could
result in the Debtors' noncompliance with government regulations,
leaving the Debtors subject to injunctive relief, fines and
penalties.  

     * Small Business Claims approximating $2,000,000.  The
Debtors utilize a number of small, local businesses in their day-
to-day operations to perform essential specialized maintenance,
operational and manufacturing services at certain of the Debtors'
manufacturing facilities.  For example, the Debtors employ small
business vendors to maintain and service special-purpose steel
mill equipment and other specialized equipment at the Debtors'
facilities.  As of the Petition Date, certain small-business
vendors had outstanding claims for prepetition goods and services
provided to the Debtors.  Because of the specialized nature of
the services provided by the small business vendors and the
invaluable expertise and institutional knowledge developed by
these entities over time, the Debtors have no readily available
substitute vendors to provide these services.  Moreover, because
many of the small business vendors work primarily or exclusively
for the Debtors, the Debtors believe that these small business
vendors could not absorb losses resulting from the Debtors'
failure to pay
outstanding small business claims on ordinary business terms.  
Any delay in paying these claims could force these small business
vendors into bankruptcy or out of business, eliminating the
Debtors' sources for certain key services and jeopardizing the
Debtors' ability to maintain operations and reorganize
successfully.  

     * Singe Source Vendor Claims approximating $5,000,000.  
Certain essential raw materials, supplies, and other goods and
services required to manufacture the Debtors' products are
available only from a single supplier.  Because the Debtors do
not have any viable alternatives to obtain substitute goods or
services from other suppliers, the Debtors have determined that
they must be able to satisfy the prepetition claims of the single
source vendors to ensure that these essential single source goods
will continue to be available without interruption.  For example,
certain single source vendors provide steel, aluminum and copper
rods with particular characteristics or of a particular
composition that are essential to the Debtors' metal fabrication
business segment and cannot be obtained elsewhere.  Similarly,
other single source vendors supply the Debtors with unique or
specially-processed products or services - including molded,
coated or processed steel and specialty paints - that are made or
provided to the Debtors' exact specifications.  In some
instances, substitute goods from other potential suppliers
technically are available, but these alternative suppliers cannot
provide the single source goods that meet the Debtors'
requirements for quality, quantity or reliability - or cannot
ensure availability on a cost-efficient and timely basis in he
appropriate geographic areas - particularly where such goods must
be provided without delay to meet "just in time" schedules.  

The Debtors also requested and obtained an order from Judge Bodoh
authorizing its banks to receive, process, honor and pay checks
issued on all of the Debtors' accounts to pay these critical
vendors claims. LTV Bankruptcy News, Issue No. 2; Bankruptcy
Creditors' Service, Inc., 609/392-00900)


MASTER GRAPHICS: Stephenson Asset Sale Hearing Set for Thursday
---------------------------------------------------------------
Master Graphics, Inc. and its wholly-owned subsidiary Premier
Graphics, Inc. held an auction for the purchase of substantially
all of the assets relating to the Stephenson Printing Division
located in Arlington, Virginia.  Stephenson Acquisition, Inc.,
prevailed with its stalking-horse $11.5 million cash bid plus
additional consideration.  Lawyers at Skadden, Arps, Slate,
Meagher & Flom LLP will bring a sale motion before the Delaware
bankruptcy court for final approval on January 25, 2001 at 11:00
a.m.  


MONEY'S FINANCIAL: Committee Taps Glass & Assoc. as Consultant
--------------------------------------------------------------
The Official Committee of Unsecured Creditors of Money's
Financial LLC and its affiliated debtors seeks approval of
employment of Glass & Associates Inc. as financial analyst and
consultant in the US Bankruptcy Court, District of Delaware.

The hourly billing rates for Glass Professionals are:

     Jack R. Stone, Jr.        Principal         $350
     Janet Collinsworth        Senior Associate  $275
     Jim Rowe                  Senior Associate  $275
     Chris Kelly               Senior Associate  $275
     Rebecca Jarmon            Associate         $125

The Committee contemplates that Glass' professionals will:
"Investigate the acts, conduct, assets, liabilities, and
financial condition of the debtors and its affiliated companies,
including the debtors' parent company, Money's Mushrooms Ltd.,
the operation of the debtor's business and the desirability of
the continuance of such business, and any other matter relevant
to the case or to the formulation of a plan. Additionally, Glass
will perform any and all other financial services for the
Committee that the Committee determines are necessary and
appropriate."


OPTICARE HEALTH: Shareholders Extend Secured Bridge Financing
-------------------------------------------------------------
OptiCare Health Systems, Inc. (Amex: OPT) announced several
organizational and capital transactions undertaken as a part of
its overall restructuring.

The Company said that it has executed a definitive agreement for
the sale of its Connecticut operations, which was previously
announced. The transaction, which is anticipated to close in
February, is still subject to several closing conditions. The
closing of this transaction is expected to fulfill the company's
obligation under its second amendment to its bank facility.

Several members of the Company's Board of Directors have also
resigned. Martin Franklin and Ian Ashken tendered their
respective resignations effective January 3, 2001. Also, Allan
Barker tendered his resignation on January 9, 2001. The Company
is recruiting replacement directors, which it hopes to announce
in the near future. The Company has also reduced the size of its
corporate operations, which will help accelerate its plan to
return to profitability.

In addition, the Company also consummated a $500,000 secured
short-term loan with an investor group led by existing major
shareholders. As additional consideration for this facility, the
Company has issued 750,000 warrants at the then fair market value
of $.40. In addition, a warrant holder who was also an investor
of the group has agreed to surrender 250,000 previously issued
warrants.

Dean Yimoyines, Chairman and CEO of OptiCare, commenting on these
developments, stated: "We are making progress in our
restructuring efforts and, in particular, are pleased that the
agreement to sell our Connecticut operations has been executed.
We are optimistic that net income from continuing operations will
be re-established during 2001."

OptiCare Health Systems, Inc. is an integrated eye care services
company focused on managed care and professional eye care
services. It currently owns, operates, and develops laser and
ambulatory surgery centers and provides systems, including
Internet-based software solutions to eye care professionals.


OWENS CORNING: Enters into New Contract with Elk Corporation
------------------------------------------------------------
Owens Corning asks Judge Walrath to authorize the company to
assume two fiber purchase supply contracts with Elk Corporation
of Texas, and permit Owens Corning's Trumbull Asphalt Division to
enter into a new supply agreement with Elk.

Under these agreements, the term of which extends through
December 31, 2003, Owens Corning sells to Elk wet formed glass
fiber of various types and sizes.  The quantities vary,
increasing from the present volume of 67 million tons in 2001 to
89 million tons in 2003.  Under a second agreement for wet-formed
glass fiber, the term of which extends to December 31, 2001, the
quantity is based on Owen Corning's good faith estimated minimum.

Owens Corning also seek authority for its Trumbull Division to
enter into an asphalt purchase agreement providing for Owens
Corning's supply of 100% of the roofing asphalt requirements of
Elk's facilities in Ennis, Texas, Myerstown Pennsylvania, Shafter
California, and any new Elk facilities constructed in the future.

Elk is a manufacturer of fiberglass asphalt roofing shingles and
glass fiber mat, and is a major supplier to and customer of Owens
Corning.  Elk's purchases of glass fiber from Owens Corning under
the fiber purchase supply agreement represent a high percentage
of the total production capacity of Owens Corning's plant in
Jackson, Tennessee.  Elk's purchases are said by the Debtors to
generate more than $20 million in annual sales revenue for Owens
Corning.  Elk needs the glass fiber it purchases to produce the
glass fiber mat that Elk in turn sells to Owens Corning under the
wet shingle mat supply agreement.  The glass fiber mat that Owens
Corning buys from Elk is used in Owens Corning's manufacture of
Owens-Corning branded products. Without glass fiber mat produced
by Elk, Owens Corning would lose the annual sales revenue
generated by the sale of these products.

Elk asserts that, as of the Petition Date, Owens Corning owed Elk
$1,789,646 under the fiber agreements, consisting of (a)
$1,327,329 under the web formed mat supply agreement for
outstanding glass fiber mat invoices, and (b) $462,317 under the
fiber purchase supply agreement, for earned quantity rebates.  
Elk also asserts a claim for $71,039 for roofing shingles sold
prepetition to Norandex/Reynolds, now known as Exterior Systems,
Inc., one of the Debtors in these cases.  Although Owens Corning
is currently unable to verify these precise amounts, it
acknowledges that Elk holds a substantial prepetition claim.  
Owens Corning's books and records indicate that, on the Petition
Date, Elk owed Owens Corning approximately $800,000 under the
fiber agreements, including (a) approximately $700,000 under the
fiber purchase supply agreement for purchases of glass fiber, and
(b) approximately $100,000 under the wet formed mat products
supply agreement for earned quantity rebates.  Elk also
owed Owens Corning approximately $2.6 million for roofing asphalt
purchases by the Elk facilities.  Accordingly the total
prepetition amount owed by Elk to Owens Corning is approximately
$3.4 million.

Unless Owens Corning is authorized to assume the fiber
agreements, Elk has indicated that it will move for relief from
the automatic stay to permit Elk to set off amounts that Elk owes
to Owens Corning against amounts that Owens Corning owes to Elk.  
Owens Corning believes that if such a setoff was permitted, Elk
would set off as much as necessary to satisfy its prepetition
claim against Owens Corning in full.

Elk is a key customer and supplier to Owens Corning, and Owens
Corning believes that its continued performance under the fiber
agreements is in the best interests of the Debtors' estates and
their creditors.  Assumption of the fiber agreements will help
maintain Owens Corning's important business relationship with
Elk.  If assumption is approved, Owens Corning and Elk will
reconcile any discrepancy with respect to the prepetition amounts
owing between them as they would in the ordinary course of
business.  As explained above, Owens Corning believes that the
result of the reconciliation will be a substantial net payment to
Owens Corning.

With regard to a new agreement with Elk, Owens Corning's Trumbull
Asphalt Division has in the past sold roofing asphalt to Elk's
facilities for use in the manufacture of fiberglass asphalt
roofing shingles.  Under the asphalt agreement, Owens Corning's
Trumbull Asphalt Division will supply Elk with 100% of the
roofing asphalt requirements of the Elk facilities.

The asphalt agreement extends through December 31, 2005, with a
one-year renewal clause.  Owens Corning anticipates that it will
realize approximately $65 million in annual revenues from sales
under the asphalt agreement.  This agreement is a profitable
arrangement that will permit Owens Corning's Trumbull Asphalt
Division to take full advantage of its supply infrastructure.  
The asphalt agreement represents volumes and specifications
similar to those presented in other supply agreements that the
Trumbull Asphalt Division has entered into with other customers.  
Owens Corning believes that the asphalt agreement will permit it
to continue to grow and to maximize its profitability through the
efficient utilization of its operating facilities.(Owens Corning
Bankruptcy News, Issue No. 8; Bankruptcy Creditors' Service,
Inc., 609/392-0900)


PACIFIC GAS: S&P Lowers Related Issues to CC
--------------------------------------------
Standard & Poor's lowered its rating to double-'C' from triple-
'B'-minus on bonds issued by various issuers for the benefit of
Pacific Gas & Electric Co. (see list below). The ratings remain
on CreditWatch with negative implications where they were placed
Jan. 5, 2001.

The bonds are secured by direct payments from Pacific Gas &
Electric Co. to the trustee. In the event of nonpayment by
Pacific Gas & Electric Co., bondholders cannot look to any other
source of revenues to secure debt service payments. Therefore,
the ratings reflect the downgrade of Pacific Gas & Electric Co.
to double-'C'. Pacific Gas & Electric Co.'s downgrade reflects
the heightened probability of the utility's imminent insolvency
and the resulting negative financial implications for affiliated
companies because:

  -- Some of Pacific Gas & Electric's principal trade creditors
are demanding that sizable cash payments be made as a
precondition to the purchase of commodities necessary for ongoing
business operations.

  -- Neither legislative nor negotiated solutions to the state's
utilities' financial meltdown appear to be forthcoming in a
timely manner, which continues to impede access to financial
markets for the working capital needed to avoid insolvency.

  -- Southern California Edison Co.'s decision to default on its
obligation to pay principal and interest due on Jan. 16, 2001,
diminishes the prospects for Pacific Gas & Electric's access to
capital markets.

  -- Pacific Gas & Electric, as a participant in California's
generation markets, may be obligated by the California Power
Exchange's tariff to absorb a portion of Southern California
Edison's defaulted Jan. 16, 2001, payment to the Power Exchange
following that utility's decision to suspend Power Exchange
payments.

The CreditWatch negative listing reflects expectations that the
ratings will be further downgraded as Pacific Gas & Electric
Co.'s financial condition deteriorates.

Although there is still a possibility that federal or state
officials will act to rehabilitate the state's utilities'
financial health, such prospects appear increasingly remote.
California's governor is opposed to providing Pacific Gas &
Electric and Southern California Edison with rate relief beyond
the nominal one cent per kWh rate increase adopted by the Public
Utilities Commission at its Jan. 4, 2001, meeting.

The legislature is in special session to address the state's
power crisis and its utilities' weak financial condition. To
date, however, the legislature has prioritized long-term
solutions for California's power markets ahead of the utilities'
immediate financial needs. Consequently, capital markets remain
unwilling to advance funds to the utilities, which could scuttle
the legislature's long-term plans.

Pacific Gas & Electric's risk of insolvency is directly related
to the mechanisms underlying California's restructuring of its
electric industry. The legislative and regulatory framework for
that restructuring led to sizable imbalances between Pacific Gas
& Electric's operating expenses and revenues. An immediate plan
that provides sufficient confidence to the capital markets that
lenders will be repaid for existing and future debt obligations
remains the only way to restore the state's utilities to a sound
financial footing, Standard & Poor's said.


PACIFIC GAS: Lenders Treat Utility Like a "Deadbeat Borrower"
-------------------------------------------------------------
Treating Pacific Gas and Electric Co. (PG&E) like a deadbeat
borrower, lenders essentially cut up PG&E's credit card Wednesday
in a move that could mean even more rolling blackouts for
Northern Californians, staff reporters for the Associated Press
write.  Stripped of its financial lifelines, PG&E warned in a
shareholder update that it could be marooned in the power market.
In the shareholder documents filed with the Securities and
Exchange Commission (SEC), PG&E said it will be blocked from the
California Power Exchange beginning today unless it can negotiate
a deal that grants the utility more room to pay its bills.

A reprieve would require the cooperation of out-of-state energy
generators, many of whom are reluctant to sell electricity to
California without being paid in cash up front. The generators
fear California's two largest utilities are on the verge of
bankruptcy, a threat PG&E acknowledged as a distinct possibility
in its SEC filing. San Francisco-based PG&E said its financial
woes worsened Wednesday after losing access to the remaining $128
million available under two credit lines previously granted to
the utility and its parent company. PG&E said the power utility
and its parent company have a combined $1.05 billion in cash
remaining. PG&E estimates that $2.7 billion in electricity-
related bills will come due between early February and early
March. (ABI World, January 19, 2001)


PACIFIC GAS: Responds to Action by California Attorney General
--------------------------------------------------------------
Pacific Gas & Edison Corporation director of communications Shawn
Cooper issued the following statement in response to a petition
filed by the California Attorney General with the Federal Energy
Regulatory Commission asking the commission to set aside an order
it issued on January 12 approving a new corporate structure for
PG&E Corporation's National Energy Group business:

     "The Attorney General's action unfortunately follows
erroneous press reports that PG&E Corporation tried to shield
assets of its unregulated affiliates from utility creditors.

     "PG&E Corporation's action was designed to preserve the
value of its National Energy Group (NEG) by enhancing its ability
to obtain a separate credit rating that could be sustained even
in the event of a bankruptcy of the utility.

     "This action was completely neutral with respect to
creditors of Pacific Gas and Electric Company. "Further, PG&E's
followed all FERC notification requirements. And in addition,
PG&E provided a courtesy notice to the CPUC of its intention on
December 28th."


PACIFIC GATEWAY: Wins Interim Okay to Borrow Under DIP Loan
---------------------------------------------------------
Pacific Gateway Exchange Inc. has won interim court approval to
borrow up to $1.5 million under a $10 million debtor-in-
possession (DIP) loan provided by a group of its pre-petition
lenders led by agent Bank of America N.A. Judge Dennis Montali of
the U.S. Bankruptcy Court in San Francisco scheduled a final
hearing on the loan for Feb. 5 and set Jan. 31 as the deadline
for filing objections. (ABI World, January 19, 2001)


SABRATEK CORP: Wants Exclusivity Extension through Jan. 29
----------------------------------------------------------
Sabratek Corporation, et al. and its Creditors' Committee seek an
extension of the periods during which the debtors and the
Committee have the exclusive right to file a plan of
reorganization and to solicit acceptances thereto.

The debtors and Creditors' Committee seek an extension of 14
days, to January 29, 2001 for the exclusive right to file a plan
and an extension until March 30, 2001 to obtain acceptances of
any filed plan.

The debtors state that they have made substantial progress in
these cases, and request a reasonable amount of additional time
to prepare the Plan of Liquidation in a consensual manner with
the Creditors' Committee. The debtors are now focusing on the
sale of GDS Technology, Inc. and the formation of a plan of
liquidation and a Disclosure Statement. The debtors believe that
the requested extension of the exclusivity periods is clearly
justified.


SOUTHERN CALIFORNIA: Green Power Suppliers to Suspend Service
-------------------------------------------------------------
Cameron Ridge, LLC, Luz Solar Partners, Ltd VIII, Luz Solar
Partners, Ltd IX, Windpower Partners 1991, L.P., Victory Garden
Phase IV Partnership, Sky River Partnership, Ridgetop Energy,
LLC, Ormesa Geothermal, and Ormesa Geothermal II, Qualified
Facilities that provide electricity to Southern California
Edison, each announced that they have delivered notice to Edison
that they intend to suspend service to Edison.

The Qualified Facilities collectively provide Edison with
approximately 500 megawatts of electricity, enough for 500,000
homes. Each of the Qualified Facilities is a provider of "clean"
energy in that they generate power through renewable resources,
such as solar power, wind power, and geothermal power. They have
been reliable providers of electricity to California for over a
decade. The Qualified Facilities have not been selling to the
open market but have maintained sales of electricity directly to
Edison pursuant to long-term power purchase contracts that, since
June, have been at a fraction of the cost of out-of-state
generation.

Edison is in default to each of the Qualified Facilities under
power purchase agreements between Edison and the facilities.
Edison failed to respond to the Qualified Facilities' requests
for assurances that they would be paid.

In their letters to Edison notifying Edison of the suspensions,
each of the Qualified Facilities indicated regret that it had
been forced to take this step and that it remained open to any
proposals that Edison may have to resolve the situation.  Ken
Klee, Esq., a partner with Klee, Tuchin, Bogdanoff & Stern in Los
Angeles, who serves as counsel to the Qualified Facilities
stated, "Edison's failure to honor its contractual obligations
may cause serious financial injury to producers of clean energy
under long term contracts. The ripple effect of Edison's
financial situation could be catastrophic unless the state
provides credit enhancements to protect valuable supply
contracts."

The Qualified Facilities have tried to find a solution short of
suspending service but Edison and other parties have not
responded to efforts to assure payment. "This is unfortunate
given the important role that suppliers of clean energy play in
protecting the environment," said Klee.

The Qualified Facilities remain committed to selling electricity
to the California market provided it receives assurances that it
will be paid by the Department of Water Resources or another
creditworthy entity.


STELLEX TECHNOLOGIES: Court to Review Exclusivity on Thursday
-------------------------------------------------------------
Stellex Technologies, Inc., et al., sought an order under 11 USC
Section 1121(d) extending exclusive periods in which the debtors
may file a Chapter 11 plan or plans and solicit acceptances
thereto.  It is unclear to what date, if any, the Debtors have
requested that their exclusive right to propose a plan be
extended.  A hearing on the motion will be held on January 25,
2001, at 3:00 PM before the Honorable Mary F. Walrath, US
Bankruptcy Court, Wilmington, DE.


SUN HEALTHCARE: Rejects Certain Equipment Leases
------------------------------------------------
Pursuant to section 365 of the Bankruptcy Code, Sun Healthcare
Group, Inc. sought and obtained the Court's authorization to
reject 39 Leases for equipment each for one or more reasons:

  -- the leases are of no further use to the Debtors' continued
     operations in the event of a scale down;

  -- the leases are for equipment and the Debtors are accordingly
required under 11 U.S.C. Sec. 365(d)(l0) to maintain the lease
payments starting from 60 days after the commencement of the
chapter 11 cases if the leases are not rejected;

  -- the equipment is obsolete or has reached the end of its
useful life;

  -- the Debtors can obtain similar equipment for lower prices
from other sources.

  -- the Debtors are not satisfied with the equipment or the
services under the leases;

  -- prepetition arrearages make the cost of assuming the Leases
higher than for leasing similar equipment from an alternate
source;

In their business judgment, the Debtors have determined that
rejection of the leases is in the best interest of the estates
and creditors. For the purpose of rejection, the Debtors have
included secured sales that may not be true leases. The Debtors
make it clear that they do not admit that any of the leases are
true leases. (Sun Healthcare Bankruptcy News, Issue No. 17;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


TEAR DROP: Creditors to Convene for 341 Meeting on Feb. 2
---------------------------------------------------------
On December 4, 2000 Tear Drop Golf Company filed voluntary
petitions for relief under Chapter 11. A meeting of creditors
will be held on February 2, 2001, at 1:30 PM, 844 King Street,
Wilmington, DE. Counsel for the debtor is Mary M Maloney Huss, of
the law firm Wolf, Block, Schorr and Solis-Cohen.


TRI-VALLEY: Plan Calls for Break-Up Among Four Buyers
-----------------------------------------------------
Six months after troubled Tri-Valley Growers filed for
bankruptcy, the 68-year-old food-processing giant may be getting
some relief, according to a newswire report. A newly approved
plan will pay off more than $500 million of debt and split the
co-op among four buyers. According to a Tri-Valley spokesperson,
John Hancock Life Insurance will buy nine of the 10 Tri-Valley
canneries, Del Monte foods will acquire S&W Fine Foods, Furman
Foods of Pennsylvania will buy Tri-Valley's tomato cannery in New
Jersey and Alan Ebald will buy the rights to the Monarch brand
overseas. Tri-Valley's four buyers paid a total of $153.7 million
in cash. John Hancock Insurance, the co-op's largest creditor,
will assume $165 million in loans to Tri-Valley.

The situation allows Tri-Valley Growers to continue to have a
presence in the central valley and to continue working with
vendors, customers and growers. (ABI World, January 19, 2001)


VENCOR INC.: Selects Cyberview to Enhance Level of Data Analysis
----------------------------------------------------------------
CyberView Corporation, a leading supplier of medical Knowledge
Management tools, announced that Vencor has selected the
CyberView data visualization solution for their acute care
hospitals.

Vencor chose CyberView due to the many data views, ease of use,
multi-facility analysis capability and "out of the box"
integration with Meditech's Data Repository. Additionally,
CyberView will assist Vencor with complex data analysis across
multiple hospitals and with roll-up reports by region and
company.

Vencor owns and operates 56 long-term acute care hospitals.
Vencor also owns 300 nursing centers, a long-term care pharmacy
business, a rehabilitation services provider and sleep disorder
centers.

"We are looking forward to the implementation of the CyberView
system," said Rick Chapman, Chief Information Officer of Vencor.
"CyberView will provide Vencor an enhanced level of data analysis
across our 56 long term acute care hospitals. CyberView's
capabilities were an excellent match to our requirements for a
system that integrates with our Meditech Data Repository
application. In addition, CyberView's Web based client will
compliment Vencor's Intranet strategy."

"We are very excited about the addition of Vencor to our growing
CyberView customer base," said Daniel Chavez, President and Chief
Operating Officer of CyberView. "We are looking forward to the
exciting future of CyberView with new developments and
technologies on the horizon. With the addition of Vencor to our
client base we continue to solidify our position as a leader in
the Knowledge Management systems market."

                     About CyberView Corporation

CyberView Corporation develops knowledge management solutions for
the healthcare industry. These solutions are a data visualization
toolset that retrieves information from various application data
sources and combines that data with public practice data to
provide revealing insights into the provider's outcome
statistics. CyberView Corporation based in Austin, TX, is a
CyberPlus Company (www.cyberplus.com). (Vencor Bankruptcy News,
Issue No. 23; Bankruptcy Creditors' Service, Inc., 609/392-0900)


VISION METALS: Hires PricewaterhouseCoopers as Financial Advisors
-----------------------------------------------------------------
The US Bankruptcy Court, District of Delaware, entered an order
authorizing the employment and retention of PricewaterhouseCoopers
LLP as the financial advisors to Vision Metals, Inc., et al.


VISION METALS: Committee Selects Lowenstein Sandler as Counsel
--------------------------------------------------------------
The Official Committee of Unsecured Creditors of Vision Metals,
Inc. and Vision Metals Holdings, Inc. seeks court authority to
retain Lowenstein Sandler PC as counsel to the Committee.

The firm will provide the following services to the Committee,
among others:

     * Providing legal advice as necessary with respect to the
Committee's powers and duties as an official committee;

     * Providing legal advice as necessary with respect to any
disclosure statement and plan filed in this case and with respect
to the process for approving or disapproving disclosure
statements and confirming or denying confirmation of a plan;

     * Preparing on behalf of the Committee as necessary
applications, motions, complaints, answers, orders agreements and
other legal papers;

     * Appearing in court to present necessary motions,
applications and pleadings and otherwise protecting the interests
of the Committee and unsecured creditors of the debtors.

Pursuant to certification of counsel in support of application,
Sharon L. Levine, a member of Lowenstein Sandler states that
attorney likely to represent the Committee in this matter have
current standard hourly rates ranging between $195 and $340. The
legal assistants that will likely assist the attorneys who will
represent the Committee have current standard hourly rates of
$100 and $95.


WHEELING-PITTSBURGH: Bluestone Wants Supply Contract Decision Now
-----------------------------------------------------------------
Bluestone Coal Corporation, through its attorneys Steven L.
Thomas, Esq., of Kay Casto & Chaney PLLC in Charleston, West
Virginia, and Joseph C. Lucci, Esq., of Nadler Nadler & Burdman
Co., LPA, in Youngstown, Ohio, filed a motion seeking an Order
compelling Wheeling-Pittsburgh Steel Corporation to assume or
reject executory contracts for low volutility metallurgical
coal.

Under this contract, WPSC purchases all of its requirements of
low volutility metallurgical coal from Bluestone. The contract
price is $37.00 per ton, and WPSC is to pay for delivered coal
within 45 days after shipment. At the Petition Date, WPSC owed
Bluestone approximately $3,301,000, of which approximately
$2,000,000 was outside the contract payment period. The term of
this contract was to run through December 31, 2001, and
automatically renews for another year unless either Bluestone or
WPSC give notice of intention to terminate prior to December 31
of the preceding year.

Bluestone advises Judge Bodoh that it is a relatively small,
privately owned coal company. Approximately 40% of its yearly
production is devoted to WPSC (approximately 450,000 tons per
year). If the current receivable owed by WPSC to Bluestone is not
paid, it will materially affect Bluestone's operations. Further,
the present market price of low volatility metallurgical coal of
the type sold by Bluestone is substantially above $37.00 per ton.
If WPSC does not intend to assume this contract, and is not
compelled to make that determination and either cure the default
and assume the contract, or reject it, leaving Bluestone free to
secure other orders for this coal, Bluestone will be at a
substantial competitive disadvantage in being able to secure
orders for this volume of coal in the market place. The
consequence of this non-payment and uncertainty is that Bluestone
may be forced to commence its own Chapter 11 proceeding, in which
it could possibly reject the contract with WPSC so it would be
able to find substitute purchasers for this production.

Bluestone further advises Judge Bodoh that it believes WPSC has
already investigated the viability of rejecting its executory
contract with Bluestone by soliciting orders for low volatility
metallurgical coat and has found that this coal may not be
available at all, and if it is available, it will be at a
substantial premium above its contract price with Bluestone. Thus
WPSC may have already decided that it will need to assume its
contract with Bluestone, but has not yet taken any affirmative
steps to do so. Bluestone thus urged Judge Bodoh to enter an
Order compelling WPSC to make and act upon its decision to either
accept this contract, curing the arrearage and performing on a
current basis under the contract for its remaining term, or to
reject it so that Bluestone could attempt to replace its coal
output onto the general market. (Wheeling-Pittsburgh Bankruptcy
News, Issue No. 4; Bankruptcy Creditors' Service, Inc., 609/392-
0900)

                          *********

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 are
available at your local bookstore or through Amazon.com.  Go to
http://www.amazon.com/exec/obidos/ASIN/189312214X/internetbankrup
t to order any title today.  

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 USA, and Beard
Group, Inc., Washington, DC USA. Debra Brennan, Yvonne L.
Metzler, May Guangko, Aileen Quijano and Peter A. Chapman,
Editors.

Copyright 2001.  All rights reserved.  ISSN: 1520-9474.

This material is copyrighted and any commercial use, resale or
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