TCR_Public/010212.MBX          T R O U B L E D   C O M P A N Y   R E P O R T E R

             Monday, February 12, 2001, Vol. 5, No. 30

                            Headlines

BROADCASTAMERICA.COM: May Default on Postpetition Obligations
CAVION TECHNOLOGIES: Liberty Still Securing Customer Commitments
eCOUNTRIES: Succumbs to Dot-com Doom
FRUIT OF THE LOOM: Hires CEC to Sort-Out Environmental Problem
FURR'S RESTAURANTS: Long-Term Debt Obligations Come Due This Year

FURRS SUPERMARKETS: Files for Chapter 11 Protection in New Mexico
FURRS SUPERMARKETS: Case Summary & 24 Largest Unsecured Creditors
FURRS SUPERMARKETS: Court Approves $33 Million of DIP Financing
GARDEN BOTANIKA: To Sell Substantially All Assets & Close Stores
GRAHAM PACKAGING: Moody's Downgrades Ratings to Junk Status

HARNISCHFEGER INDUSTRIES: Soliciting Exit Financing Proposals
HASBRO INC.: Fitch Lowers Senior Notes & Debentures to BB Rating
IMPERIAL SUGAR: Summary of Debtors' Prepackaged Chapter 11 Plan
INTEGRATED HEALTH: Heller Presses Debtors To Decide On Contracts
JITNEY JUNGLE: Designates Feb. 6 as Effective Date of Plan

LERNOUT & HAUSPIE: To Sell Mendez Unit By June 30
LERNOUT & HAUSPIE: Inks $60MM DIP Pact with Ableco & Gabriel
LTV CORPORATION: Paying Employee and Contractor Wages & Salaries
MARINER POST-ACUTE: Wants LCA To Assume & Assign Lease To LCEI
METRICOM, INC.: Moody's Cuts Senior Debt Rating To Caa1

NORTHPOINT COMMUNICATIONS: Shares Delisted From NASDAQ
NORTHWESTERN STEEL: Gets Final Court Nod For $65 MM DIP Loan
ORBCOMM Global: Seeks Court Approval To Auction Ongoing Business
PILLOWTEX: Asks Court to Extend R. 9027 Removal Period to June 12
PLAY-BY-PLAY: Debt Restructuring Talks with Convertibles Collapse

PLAY-BY-PLAY: Cuts 50 Corporate Jobs to Immediately Reduce Costs
PLAY-BY-PLAY: Restructures Licensing Agreements With Warner Bros.
RELIANT ENERGY: Fitch Gives BBB+ Rating to New Debt Offering
RIVERSIDE GROUP: Default on 11% Notes Triggers Cross-Default
SAFETY-KLEEN: Enters Into New South Carolina Office Leases

SUNBEAM CORP.: Review & Summary of $285,000,000 DIP Facility
SUN HEALTHCARE: Rejects Forklift Lease With Associates Leasing
SUNSHINE MINING: Emerges From Bankruptcy
TRI-UNION: Plans Oil & Gas Asset Sales & Terminates Contango Deal
VENCOR INC.: Settles SERP Claims With W. Bruce Lunsford

VLASIC FOODS: Gets Okay to Maintain Existing Bank Accounts
WHOLETREE.COM: Files Chapter 7 Petition in Colorado

BOND PRICING: For the week of February 12 - 16, 2001

                            *********

BROADCASTAMERICA.COM: May Default on Postpetition Obligations
-------------------------------------------------------------
BroadcastAmerica.com may be unable to pay all the vendors who
provided it with services after the debtor filed for chapter 11
bankruptcy protection, according to the Portland Press Herald.
BroadcastAmerica, an Internet company based in Portland, Ore.,
has at least $4 million in debts. It is unclear how much pre-
petition debt and how much post-petition debt the company has. At
a recent court hearing, BroadcastAmerica lawyer Roger A. Clement
Jr. estimated the company's assets at $130,000, but several
court-approved payments to creditors have reduced that amount.

An auction of BroadcastAmerica's assets produced disappointing
results. The company and Clement had hoped before the auction
that a bidder would offer to buy the entire company. He declined
to comment on whether the company received any bids for the
entire company or on how many bids were submitted for the various
parts of the company. Clement said he has asked Judge James B.
Haines Jr. to schedule a second auction for March 31 of the
company's assets after the first auction failed to garner any
satisfactory bids for that property. The auctioneer, Keenan
Auction Co., has guaranteed it will raise $90,000 for the
physical property. If it doesn't, it would buy the property
itself. (ABI World, February 8, 2001)


CAVION TECHNOLOGIES: Liberty Still Securing Customer Commitments
----------------------------------------------------------------
Despite facing the challenges of securing credit union customer
agreements, negotiating with suppliers and creditors, and
responding to the requirements of the bankruptcy court, Liberty
Enterprises continues its efforts to acquire the assets of Cavion
Technologies.

As of Thursday afternoon, 80 Cavion customers had signed new
contracts with Liberty, contingent upon Liberty's acquisition of
Cavion. The customer commitments are keys to establishing a
foundation of positive cash flow and break-even operating income.
Liberty continues to solicit potential credit union customers.
"If we are able to secure 10 to 15 more customer commitments in
the next days, we would make dramatic progress toward meeting our
original financial model requirements, which are positive cash
flow and break-even operating income," said Robert D. Anderson,
Liberty president & chief executive officer.

According to Michael J. Provenzano, Liberty executive vice
president for Internet applications, the company has received
"remarkable cooperation" from all of Cavion's business providers
and that Liberty is "close to final terms with all major
suppliers." Last week, Liberty announced it had reached agreement
with two key partners, Convergent Communications Services, Inc.,
and Data Sales Company, Inc.  Provenzano said Liberty has also
made significant progress in negotiations with Cavion's key
creditors.

Liberty's acquisitions efforts received another boost yesterday
when the U.S. Bankruptcy Court in Denver set a hearing date of
Feb. 16 to review Liberty's letter of intent to purchase Cavion.
Liberty executives declined to speculate when a final acquisition
decision will be announced.

"We are still hopeful, which is why we are extending our
efforts," said Anderson. "Our final decision depends on several
factors, ranging from credit union customer commitment, to
creditor approval, to bankruptcy court review."

Liberty, the credit union movement's leading provider of payment
systems, marketing services and technology services, signed a
letter of intent to purchase the assets of the Denver-based
credit union technology provider on Jan. 19. Cavion filed for
Chapter 11 bankruptcy protection on Dec. 21, 2000.

                          About Liberty

Liberty partners with 5,000 credit unions in all 50 states, Guam
and Puerto Rico. Liberty's core product is the check, still
consumers' leading financial transaction vehicle. The company is
the credit union movement's leading provider of payment systems
(checks, card services, financial supplies), marketing services
(database marketing, creative services, outsource marketing,
market research) and technology solutions (data processing, Web-
site development and hosting, Internet banking). Liberty is
headquartered in Mounds View, Minn., a suburb of Minneapolis-St.
Paul. The company has also established marketing centers in Los
Angeles, St. Louis, Minneapolis and Hartford, Conn.

                          About Cavion

Cavion Technologies offers products and services for secure
business-to-business communications and secure Internet financial
products and services designed specifically for the needs of
credit unions. The company's Internet software products include
secure Internet access, online transactional banking, cellular
access, online bill payment, and online loan decision products,
along with enabling software for kiosks.

Cavion created a secure, private communications network called
CUiNET (Credit Union interactive Network) exclusively for the
credit union industry. CUiNET provides a secure, high-speed
communications platform for the delivery of services,
transactions and information to and from credit unions and
related organizations, such as trade organizations, corporate
credit unions and credit union vendors. The company's
headquarters are located at 6466 South Kenton Street, Englewood,
CO 80111. Its telephone number is 720-875-1900.


eCOUNTRIES: Succumbs to Dot-com Doom
------------------------------------
eCountries, the online news, information and business-to-business
marketplace targeted at growth companies looking to develop an
international presence, has halted operations after investors 3i,
Elderstreet, and Pi Capital pulled their backing, according to
Netimperative.com. The company had operations in London, New
York, Hong Kong and Dublin. 3i, Elderstreet, and Pi Capital,
injected $7 million into the venture last April. A spokesperson
for 3i, which led the funding, confirmed the closure and said
that the decision was made after management efforts to secure
further funds failed.

The spokesperson refused to say how much 3i had contributed to
the venture, but made it clear that they would not be coming to
eCountries' rescue. "Given the very difficult conditions, we
decided at this point that further funding would not be
forthcoming," he said. Elderstreet and Pi Capital have yet to
respond to inquiries over the closure. (ABI World, February 8,
2001)


FRUIT OF THE LOOM: Hires CEC to Sort-Out Environmental Problem
--------------------------------------------------------------
NWI Land Management Corp. manages remedial activities at certain
properties located within the U.S. on behalf of itself and
pursuant to contractual obligations. NWI is the former owner of
Velsicol Chemical Corporation, a chemical and pesticide
manufacturer. NWI and Velsicol were direct and indirect
subsidiaries of Fruit of the Loom, Ltd. following the acquisition
and restructuring of Fruit of the Loom in 1986.

Civil & Environmental Consultants Inc. ("CEC") is an
environmental, civil and geotechnical engineering firm possessing
extensive knowledge and experience in providing complex
environmental remediation and management services. The firm has
an excellent safety record and reputation. CEC personnel include
specialists in hydrogeology, environmental engineering,
remediation, risk assessment, life sciences, RCRA and CERCLA and
other related disciplines. CEC has offices in Pittsburgh,
Cincinnati, Columbus, Indianapolis and Nashville.

NWI Land Management Corp., a subsidiary of Fruit of the Loom,
asked Judge Walsh for permission to retain, employ, compensate
and reimburse Civil & Environmental Consultants Inc., as an
environmental manager.

Specifically, NWI desires to retain and employ CEC as
environmental manager to perform remediation activities at
covered sites. Norman L. Pernick Esq., said there are two primary
tasks. First, CEC will perform project file transfer and
maintenance. Second, it will provide environmental management
services including site file management, program reporting,
project accounting, contractor coordination and other related
activities NWI may request.

Subject to the Court's approval, CEC will charge a monthly
advisory fee of $45,000. There will be a $4,000 one-time charge
to transfer and set up the project files relating to covered
sites. CEC will also charge an administrative fee of 10% of the
cost of all subcontracted activities. CEC will charge NWI for
out-of-scope services based on CEC's hourly rates, which range
from between $40 to $150 per hour for professionals ands
paraprofessionals. CEC will bill for any out-of-pocket expenses
incurred. The agreement is terminable by either party upon 180
days written notice.

Mr. Pernick told Judge Walsh that CEC is a disinterested party
and holds no interest adverse to Fruit of the Loom.

Provided that the Court approves NWI's motion, NWI plans to
systematically terminate its workforce in accordance with
diminished operational needs, as CEC will be performing the
remedial activity management relating to the covered sites on
behalf of NWI. The employees to be retained will provide services
in their usual capacity. NWI asserted that such employees are
critical to effecting a seamless transition of remedial activity
management to CEC. To incentivize such employees, NWI proposed to
pay at its sole discretion, to each retained employee an
incentive bonus of one week's salary for each full week of
employment beginning January 1, 2001 until such employee is
terminated. To be eligible for this bonus program, the employee
must continue to work and remain in good standing until
instructed by NWI that his or her services are no longer needed.
NWI estimates that in the aggregate, incremental cost of this
program will not exceed $125,000.

As a further incentive, NWI proposed to pay up to $75,000 to
certain employees based on their performance and overall
contribution to an orderly and timely transfer to CEC of physical
records, electronic data, institutional knowledge and to the
closing of NWI's Downers Grove, Illinois offices. Mr. Pernick
stated that NWI employees who are needed to implement the
transition of activities to CEC and to close the Downers Grove
offices must be incentivized beyond normal compensation. The loss
of experienced employees would substantially inhibit NWI's effort
to achieve a seamless transition to CEC and may hinder a smooth
closure of the offices. Employees are more likely to cooperate
during the transition if offered tangible incentives.

NWI proposed to dispose, by sale or through a liquidator, office
furniture and fixtures. The aggregate current value of the
furniture is estimated to be less than $10,000. The proceeds of
the sale will be applied by NWI in accordance with the terms of
the financing order. NWI requests that the transfer be exempt
from any tax.

Vice President Kenneth R. Miller told the Court that CEC is a
private firm with 190 professionals. CEC researched its client
database and determined there is no fact or situation which would
represent a conflict of interest with regard to Fruit of the
Loom. (Fruit of the Loom Bankruptcy News, Issue No. 21;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


FURR'S RESTAURANTS: Long-Term Debt Obligations Come Due This Year
-----------------------------------------------------------------
Furr's Restaurant Group, Inc. (Amex: FRG) announced the election
of Robert N. Dangremond to the Company's Board of Directors last
week.  Mr. Dangremond is a principal with Jay Alix and
Associates, a restructuring management firm based in Southfield,
Michigan.  In addition to his responsibilities at Jay Alix
Associates, he currently serves as a Senior Vice President of
Harnischfeger Industries, Inc., a global manufacturer of mining
equipment and pulp and papermaking machinery.

"We are very fortunate to have Bob as a Furr's Restaurant Group
board member," said Damien Kovary, Chairman of Furr's Board of
Directors. "He is well known for his success in improving
shareholder value and will assist with both the short and long-
term development of the Company."

While the company said nothing further in connection with the
announcement of Mr. Dangremond's appointment, the company's
latest Form 10-K indicates that $50-some million of long-term
debt comes due on December 31, 2001.  With a balance sheet
showing liabilities in excess of assets, repayment may prove to
be problematical.  The Company's next Form 10-K should be filed
with the Securities and Exchange Commission in the last week of
March 2001.

Furr's Restaurant Group, Inc. operates 96 cafeterias under the
Furr's and Bishop's names in 12 midwestern, southwestern and
western states. The Company also operates Dynamic Foods, its food
preparation, processing and distribution division, in Lubbock,
Texas.


FURRS SUPERMARKETS: Files for Chapter 11 Protection in New Mexico
-----------------------------------------------------------------
Furrs Supermarkets Inc., in order to facilitate a financial
restructuring that will eliminate its burdensome debt structure
and enable it to compete more effectively, filed a voluntary
petition for reorganization under Chapter 11 of the United States
Bankruptcy Code in the United States Bankruptcy Court for the
District of New Mexico in Albuquerque.

Thomas Dahlen, Furrs' Chairman, President and CEO, stated that no
lay-offs will occur as a result of the filing. He emphasized that
Furrs employees and customers should notice no difference in
operations, except for the better, as a result of the filing.

Mr. Dahlen said that daily operations will continue as usual,
store hours will stay the same and all aspects of the business
will go on as before the filing

"Despite fierce competition, a weakening economy and tighter
trade requirements we are still the market share leader in both
New Mexico and El Paso. We will now resume the progress we had
been making in profitability, through sales and expense controls.
We will continue assessing our current store base and determining
the right-size for the company in the future."

Mr. Dahlen said that for some time now, management has been
working with its lenders to put in place an agreement that would
give the company the cash it needs to operate its business in an
effective and competitive manner.

"This prolonged process took much longer than anyone anticipated,
and had a serious impact on trade obligations and created
pressure on payables and product," Mr. Dahlen said. "Faced with
this liquidity squeeze, management and the Board reviewed various
alternatives. We concluded that it was in all of the company's
key constituents' long-term best interests -- our employees,
customers and vendors -- to (1) facilitate a financial
restructuring that would eliminate the company's burdensome debt
structure; (2) secure a means for obtaining additional financing;
and (3) enable Furrs to compete more effectively through the
filing of a voluntary petition for reorganization under Chapter
11 of the United States Bankruptcy Code.

"While this was a difficult decision for us to make, it was an
absolutely necessary one. Although we would have preferred to
effectuate a restructuring outside of the court, it became clear
that this would not be possible in a timely manner," Mr. Dahlen
said.

He continued, "By utilizing the Chapter 11 process, we believe we
can achieve an orderly restructuring that will enable us to
capitalize on opportunities resulting from improvements in
operations, cost reductions and improved cash flows. Furrs will
be able to create a capital structure that will support its
operations."

"The bottom line is that our company will be stronger as a result
of this filing, and we will be better able to compete in the
marketplace and meet the changing requirements of our customers,"
Mr. Dahlen said.

Headquartered in Albuquerque, New Mexico, Furrs is the state's
largest privately held company. Furrs operates 71 stores
throughout New Mexico and West Texas and employs approximately
5,000 people.


FURRS SUPERMARKETS: Case Summary & 24 Largest Unsecured Creditors
-----------------------------------------------------------------
Debtor: Furr's Supermarkets, Inc.
         a Delaware Corporation
         c/o Steven Mortensen, Sr. VP and CFO
         4411 The 25 Way N.E., Suite 100
         Albuquerque, NM 87109
         Fax No. 505-944-2692

Chapter 11 Petition Date: February 8, 2001

Court: District of New Mexico (Albuquerque)

Bankruptcy Case No.: 11-01-10779-SA

Judge: James S. Starzynski

Debtor's Counsel: Amy S. Park, Esq.
                   Alan J. Carr, Esq.
                   Stephen J. Lubben, Esq.
                   Jamie L. Edmonson, Esq.
                   Peter W. Clapp, Esq.
                   Jay Goffman, Esq.
                   Richard Levin, Esq.
                   Skadden, Arps, Slate, Meagher & Flom LLP
                   300 South Grand Avenue
                   Los Angeles, CA 90071-3144
                   213-687-5000
                   Fax: 213-687-5600

                          and

                   Robert H. Jacobvitz, Esq.
                   David T. Thuma, Esq.
                   Jacobvitz, Thuma & Walker, P.C.
                   500 Marquette NW #650
                   Albuquerque, NM 87102
                   505-766-9272
                   Fax: 505-766-9287

Estimated Assets: More than $100 million

Estimated Debts: More than $100 million

Debtor's 24 Largest Unsecured Creditors:

Entity                        Nature of Claim     Claim Amount
------                        ---------------     ------------
Metropolitan Life             Subordinated Debt   $27 Million
Insurance Company
200 Park Avenue
New York, New York 10166
Jerry Marcus
Vice President, Private Equity
(P) 212-692-5719
(F) 212-692-5784

Countrywide Logistics         Trade Creditor      $1.9 Million
9820 Railroad Drive
El Paso, Texas 79924
Carey Prather
(P) 915-757-1183
(F) 915-757-1180

Pinnacle Logistics            Trade Creditor      $1.8 Million
9820 Railroad Drive
El Paso, Texas 79924
Rick McDonald
(P) 915-757-1106
(F) 915-757-1112

Conagra Beef Co.              Trade Creditor      $1.5 Million
File 96364
P.O. Box 1067
Charlotte, North Carolina 28201
Christy Henry
(P) 970-395-8185
(F) 970-395-0671

Frito Lay Inc.                Trade Creditor      $1.5 Million
Rold Gold Foods Division
P.O. Box 200602
Dallas, Texas 75320
Mark Fleetwood
(P) 602-333-0411
(F) 602-333-0500

Anderson News Company         Trade Creditor      $1.1 Million
6815 Washington N.E.
Albuquerque, New Mexico 87109
Patrick Lundy
(P) 505-345-5508
(F) 505-344-9677

The Berton Company            Trade Creditor      $1.1 Million
Dept. 2907
135 S. LaSalle
Chicago, Illinois
Jun Prindiville
(P) 323-728-5080 ext 232
(F) 323-728-0036

Southern Wine & Spirits       Trade Creditor          $995,157
P.O. Drawer R.
Albuquerque, New Mexico 87102
Richard Crossland
(P) 505-247-4186
(F) 505-243-2438

Procter & Gamble              Trade Creditor          $895,658
Dept. 840039
Dallas, Texas 75284
Ron C. de Baca
(P) 915-587-5529
(F) 915-587-5529

Philip Morris                 Trade Creditor          $866,823
120 Park Avenue
New York, New York 10017
Joey Andrews
(P) 806-797-1891 ext 2
(F) 806-797-1429]

National Distributing Co.     Trade Creditor          $853,959
P.O. Box 27227
Albuquerque, New Mexico 87125
Graydon Filyk
(P) 505-345-4492 ext 3367
(F) 505-342-1648

Hussmann Corporation          Trade Creditor          $784,673
2423 Collection Center Drive
Chicago, Illinois 60693
Kathern Henry
(P) 770-291-2325
(F) 770-279-8750

Edison Source                 Trade Creditor          $597,758
Dept. 0518
Los Angeles, California 90084
Dan Bonner
(P) 505-344-1851
(F) 505-344-0297

Clougherty Packing Co.        Trade Creditor          $596,914
File No. 55409
Los Angeles, California 90074
John Amiedi
(P) 800-132-7637 ext 618
(F) 823-584-1619

Pilgrims Pride Corp.          Trade Creditor          $588,044
P.O. Box 911709
Dallas, Texas 75391
Nikisha Hollins
(P) 903-855-4312
(F) 903-856-2606

Mission Foods Tempe           Trade Creditor          $569,114
File No. 843777
P.O. Box 843777
Dallas, Texas 75384
Raul Alltore
(P) 505-341-4987
(F) 505-344-4965

Quaker                        Trade Creditor          $558,733
P.O. Box 730406
Dallas, Texas 75373
Anita Riley
(P) 678-461-6868
(F) 678-461-6902

McDonnell Douglas Finance     Trade Creditor          $548,137
File No. 53876
Los Angeles, California 90074
Julianne Gullo
(P) 562-997-3347
(F) 562-997-3328

Finova Capital Corporation    Trade Creditor          $535,379
P.O. Box 6194
Carol Stream, Illinois 60197
John Farrell
(P) 201-634-3498
(F) 201-634-3311

General Mills (Dry)           Trade Creditor          $516,453
P.O. Box 951281
Dallas, Texas 75395
Don Kennedy
(P) 405-348-1468
(F) 405-348-1468

Total Control Information     Trade Creditor          $504,403
17752 Skypark Circle
Ste. 160
Irvine, California 92614
Frank Lewis
(P) 949-476-1122 ext 3022
(F) 949-476-1133

Pepsi Cola Southwest          Trade Creditor          $485,721
P.O. Box 841918
Dallas, Texas 75284
Kip Owens
(P) 505-880-5019
(F) 505-883-4138

Premier Distribution          Trade Creditor          $485,375
P.O. Box 25806
Albuquerque, New Mexico 87125
Mary Lou Dar
(P) 505-344-0287
(F) 505-345-4351

Joe G. Maloof & Co.           Trade Creditor          $457,303
P.O. Box 1086
Albuquerque, New Mexico 87103
Jim Moore
(P) 505-761-0321
(F) 505-345-8817


FURRS SUPERMARKETS: Court Approves $33 Million of DIP Financing
---------------------------------------------------------------
Furrs Supermarkets Inc. said that in a special hearing Thursday
evening it received Court approval for debtor-in-possession (DIP)
financing provided under a loan agreement with the Company's
existing lenders consisting of Heller Financial, Inc., Fleet
Capital Corporation, Bank of America, N.A. and Metropolitan Life
Insurance Company.

On an interim basis, the Court approved use of up to $33 million
DIP financing intended to provide funding for all post-petition
trade and employee obligations, as well as the Company's ongoing
operating needs during the restructuring process. The Court
scheduled a final DIP hearing for March 2, 2001.

"We are pleased that the Court promptly approved the Company's
request for post-petition financing," said Thomas Dahlen, Furrs'
Chairman, President and CEO. "This funding will help provide our
vendors with additional financial assurances that we will be
operating on a business-as-usual basis." Also according to Mr.
Dahlen, the new funds will be used to ensure store shelves are
fully stocked and store conditions are improved.

In hearings yesterday, the Court also approved the Company's
requests to pay pre-petition and post-petition employee wages,
salaries, employee benefits and other employee obligations, as
well as requests relating to the administration of the case.


GARDEN BOTANIKA: To Sell Substantially All Assets & Close Stores
----------------------------------------------------------------
Garden Botanika, Inc. (OTCBB:GBOTQ) announced that it is seeking
U.S. Bankruptcy Court approval of the sale of certain of the
Company's manufacturing assets, trade names, trademarks,
formulas, the Company's web site and other intangible assets to
an undisclosed purchaser.

The Company also announced that it has begun the closure of 61
store locations and expects to close the balance of its 48 stores
as it completes the reorganization process. The Company intends
to apply the proceeds of its store liquidation sales to reduce
the Company's debt.

"Since the Company's voluntary Chapter 11 filing in April 1999,
management and the Board of Directors have been exploring various
alternatives that would result in maximum recovery to our
creditors and, at the same time, have the least impact on our
customers and suppliers," commented President Bill Lawrence.
"After careful consideration, it was determined that the sale of
the Company's trademarks, formulas and web site would be the best
course to realize the value of the Garden Botanika brand.
Management believes that under new ownership, the Garden Botanika
business will be able to capitalize on its industry position,
while having access to broader channels of distribution and
greater financial resources."

As part of its ongoing reorganization efforts, the Redmond-based
cosmetics and personal care products company will eventually be
eliminating the approximately 40 positions in its corporate
office, as well as the approximately 25 full and part-time
positions in its California-based manufacturing and distribution
centers. According to President Bill Lawrence, the decision to
eliminate jobs is a regrettable but necessary part of Garden
Botanika's broader reorganization efforts aimed at transitioning
the Company's business to new ownership. Lawrence thanked all
Garden Botanika employees for their hard work and commitment over
the past several years.


GRAHAM PACKAGING: Moody's Downgrades Ratings to Junk Status
-----------------------------------------------------------
Moody's Investors Service downgraded the ratings of Graham
Packaging Holding as follows:

      * $169 million senior discount notes, due 2009 to Caa2 from
        Caa1;

      * $150 million 8.75% senior subordinated notes, due 2008, to
        Caa1 from B3;

      * $75 million floating rate senior subordinated notes, due
        2008, to Caa1 from B3;

      * senior unsecured issuer rating to B3 from B2;

      * $825 million secured credit facility to B2 from B1; and

      * the senior implied rating to B2 from B1.

The ratings outlook is stable. Accordingly, this concludes the
ratings review initiated on December 8, 2000.

According to Moody's, the ratings actions reflect the sequential
reduction in profitability during the second half of fiscal 2000
which has resulted in poor liquidity, very high financial
leverage, and weak coverage of interest expense. This is said to
be primarily related to difficulties with European operations
(approximately 18% of total revenue) and delays in the ramp up of
several significant projects. Moreover, rising resin costs and
increased competition are also said to be pressuring margins and
driving the reduction in financial flexibility. Moody's says that
in spite of approximately $120 million of unused availability
under the combined working capital and growth revolvers,
liquidity is constrained by nominal cushion under existing
covenants.

In Moody's opinion, Graham's depressed financial condition may
require incremental capital, independent of the stated capital
call triggers built into the credit agreement, from the equity
sponsor, The Blackstone Group. The Blackstone Group has invested
approximately $235 million in Graham.

Moody's relates that The B2 rating assigned to the secured
facilities reflects the absence of full tangible asset coverage
while the Caa1 rating assigned to the subordinated notes reflects
their contractual subordination to senior debt and the increased
possibility and severity of default. The Caa2 rating assigned to
the senior discounted notes at Holdings reflects their structural
subordination, Moody's says.

Finally, the stable ratings outlook expresses Moody's belief that
the company appears to be taking appropriate and timely actions
to address operational shortfalls.

Pennsylvania-based Graham Packaging designs and manufactures
customized blow molded rigid plastic containers for the branded
food and beverage, household and personal care, and automotive
lubricants markets. The company has 57 plants throughout North
America, Europe, and Latin America.


HARNISCHFEGER INDUSTRIES: Soliciting Exit Financing Proposals
-------------------------------------------------------------
Aside from cash flow generated by the business operations,
Harnischfeger Industries, Inc.'s primary source of working
capital during its chapter 11 cases has been the proceeds of the
DIP Facility, which is available only until confirmation of the
Plan. The Plan, however, contemplates additional financing upon
its confirmation. In particular, Section VI(A)(4) of the Plan
provides that:

"To finance the Cash requirements to consummate this Plan and to
provide HII and its affiliates with working capital on a going-
forward basis, HII shall enter into the Exit Financing Facility
on the Effective Date. The Exit Financing Facility shall be in an
amount of not less than $400 million, and it may be secured by
certain assets of HII and/or its affiliates and may be guaranteed
by certain affiliates (including other Reorganizing Debtors)."

Moreover, Sections XII(A)(2) and XII(C)(3) of the Plan provides
that, as a condition precedent to confirmation and consummation
of the Plan, exit financing shall be available to the Debtors.

The Debtors told Judge Walsh that they and their professionals
have been discussing the exit financing needs of their chapter 11
cases with potential financial institutions since November 2000.
After conversations with the financial institutions, the Debtors
and their professionals have determined that, during the course
of the bankruptcy, the credit market has become increasingly
tight. The Debtors and their professionals contacted twelve
different financial institutions, met with seven to discuss the
proposed exit financing and the business prospects of Joy and
P&H. They are seriously discussing the exit financing with five
of the financial institutions, of which two are working together.

The Debtors represent that, in order to submit an exit financing
commitment letter, they must take certain acts and pay costs and
expenses including, but not limited to:

      * financial institutions' due diligence fees, work fees
        requested by some as compensation if they are not selected
        as the final provider of the exit facility, attorneys'
        fees and out-of-pocket expenses;

      * reasonable fees of consultants and experts;

      * reasonable fees and expenses of appraisers who will value
        the Debtors' assets.

The Debtors expect that these fees may be paid to multiple
financial institutions. These fees and expenses, in the Debtors'
estimation, will not exceed $1,500,000 in the aggregate.

In light of the needs, the Debtors sought the Court's authority,
pursuant to 11 U.S.C. sections 105 and 363, to take necessary
actions and make required payments to obtain an exit financing
commitment letter.

The Debtors assured that they will consult with the financial
advisors to the Harnischfeger Creditors Committee before agreeing
to pay such fees and expenses of the financial institutions and
appraisers. The Debtors further covenant that they will file a
motion seeking approval of any exit financing commitment letter
that is ultimately entered into.

The Debtors believe that the relief requested will allow them to
satisfy a condition precedent to confirmation of its Plan, and in
so doing, they will be able to (i) repay the DIP Facility and
(ii) fund general working capital needs after confirmation and
consummation of the Plan, thereby increasing the likelihood of
successfully emerging from these cases.

Therefore, the Debtors have determined, and submit that, the
relief requested is in the best interests of their estates and
creditors. (Harnischfeger Bankruptcy News, Issue No. 37;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


HASBRO INC.: Fitch Lowers Senior Notes & Debentures to BB Rating
----------------------------------------------------------------
Fitch assigned a rating of `BB+' to Hasbro, Inc.'s new $650
million secured revolving credit facility, and lowered its rating
of Hasbro's senior notes and debentures from `BB+' to `BB'.
The rating action follows the company's announcement that it has
received a commitment for the new bank facility, which is secured
by receivables, inventories and intellectual property, and
reflects the fact that the senior notes will now be subordinated
to the new facility. As of Dec. 31, 2000, Hasbro had total debt
outstanding of approximately $1.4 billion. The Rating Outlook is
Negative.

Hasbro's operations have been pressured by an earlier-than-
expected fall-off in the Pokemon trading card business and
additional weakness in the U.S. toy business. In response to the
weaker environment, Hasbro is moving ahead with a restructuring
announced in October to refocus on its core brands and become
less reliant on faddish, licensed product. As part of this
restructuring, Hasbro is making progress in reducing its cost
structure to bring it in line with a smaller revenue base.
However, the ultimate success of these initiatives remains
uncertain.

The rating assumes that the company's financial posture will
begin to rebound in 2001 as operating cash flow improves and debt
levels are reduced. The recent sale of Hasbro Interactive and
Games.Com enables Hasbro to eliminate substantial losses from
those businesses while providing the potential for future upside
through a licensing agreement. In addition, Hasbro is cutting its
dividend in half, saving $21 million per year. Fitch expects that
the proceeds from the sale and the dividend cut will be applied
to debt reduction, and that the company's credit protection
measures should recover in 2001 to a level that is appropriate
for the rating.

Nevertheless, the Negative Rating Outlook reflects uncertainty as
to the pace of improvement and the cyclical and shifting nature
of the toy industry.


IMPERIAL SUGAR: Summary of Debtors' Prepackaged Chapter 11 Plan
---------------------------------------------------------------
With a number of blanks to be filled-in over the next few weeks,
Imperial Sugar Company presented the Court with their Prepackaged
Plan of Reorganization and a Disclosure Statement in support of
their plan.

          Pre-petition Alternatives and Negotiations

Prior to making a decision to commence these Chapter 11 cases,
the Debtors first explored strategic alternatives, such as
increasing sales on high margin, value-added products, cost
reductions through office closures and workforce reductions, and
discontinuation of unprofitable can sugar refining at Clewiston,
Florida, and sugar beet processing at facilities in Tracy and
Woodland, California. The Debtors also attempted savings through
more efficient purchasing and control of manufacturing costs,
liquidated their portfolio of marketable securities to pay down
long-term debt, and explored a sale of the Debtors' nutrition
products operations. The liquidation of the Debtors' securities
portfolio generated $36.6 million to pay down senior term loans.
Realized securities gains were reported net of realized losses of
$0.5 million in fiscal 2000. Marketable securities at September
30, 2000, were pledged to secure certain insurance obligations.

In an effort to optimize the potential for a successful
reorganization, Imperial retained the services of the investment
banking firm Wasserstein Perella & Co., Inc., and the law firm
Baker Botts L.L.P., its longtime outside legal counsel. With
these entities' assistance, Imperial undertook a series of
discussions prior to the commencement of these cases with
representatives of various major creditors, including the Bank
Group, led by Harris Trust & Savings Bank, and an Ad Hoc
Committee of holders of Imperial Sugar subordinated Notes
consisting of noteholders who have represented that they
collectively hold approximately $140 million of $250 million of
outstanding principal face amount of Imperial Sugar Subordinated
Notes. Members of the Bank Group were represented in these
discussions by the law firm of Chapman & Cutler and the
Accounting firm of FTI/Policano & Manzo, while the Ad Hoc
Committee was represented by the law firm of Skadden, Arps,
Slate, Meagher & Flom (Illinois) and the investment banking firm
of Houilihan, Lokey, Howard & Zukin. The result was the
development of a prenegotiated structure to enable the Debtors to
emerge from bankruptcy quickly and with a capital structure more
appropriate to its current liquidity needs. Negotiations with the
Bank Group led to a framework for restructuring Bank Group claims
and an agreement to provide DIP financing. The Ad Hoc Committee
agreed in principle to a conversion of their unsecured debt to
equity in Reorganized Imperial, thus significantly enhancing the
Debtors' liquidity by eliminating over $250 million in debt
obligations.

The Debtors stated that these Chapter 11 cases were commenced to
implement the terms of these agreements in principle with the
Debtors' key creditor constituencies. The Plan if the product of
intensive efforts by the Debtors and certain creditors to develop
a plan of reorganization for the Debtors which the plan
proponents describe as "fair and equitable" to all concerned,
while allowing the Debtors to emerge from bankruptcy with a
rational and competitive capital structure.

          The Senior Credit Facility

As of the Petition Date, the Debtors had long-term secured and
unsecured debt and revolving credit obligations consisting of
$250 million on unsecured Imperial Senior Subordinated Notes due
2007, $83.4 million in secured Tranche A Term Loans, $66.2
million in secured Tranche B Term Loans, $152.6 million in
borrowings under the Revolving Credit Facility, and $25.1 million
in liability on long-term industrial development bonds. Imperial
is the principal obligor on both the Imperial Senior Subordinated
Notes and on obligations under the Senior Credit Agreement.
Biomass, Crown Express, Diamond Crystal, Diamond Crystal Brands,
Diamond Crystal Brands, L.P., Diamond Crystal Holdings, Dixie
Crystal, DSLT, FCI, Fort Bend, Great Lakes, Holly, Holly
Northwest, Imperial Distributing, Imperial-Savannah, Imperial
Sweeteners, King, Limestone, Menu magic, Michigan Sugar, Phoenix,
Ragus, Savannah Foods, Savannah Industrial, Savannah investment,
Savannah Molasses, Savannah Sugar, Wholesome Sweeteners Group,
and Wholesome Sweeteners are guarantors of Imperial's obligations
both to the Bank Group and to holders of Imperial Senior
Subordinated Notes.

Interest on the Debtors' senior, secured indebtedness under the
Tranche A Term Loans, the Tranche B Term Loans, and the Revolving
Credit Facility is at floating rates (either at a base rate plus
margin ranging from 0.75% to 3.0%, or a Eurodollar rate plus a
margin ranging from 1.75% to 4.0%). As of September 2000 these
rates effectively were fixed at a weighted annual average rate of
9.3% through interest rate swap agreements between Imperial and
major financial institutions. Borrowings under this Senior Credit
Agreement are secured by liens and security interests on
substantially all of the Debtors' assets, including the Debtors'
inventory, equipment and real property.

Prior to the commencement of these Chapter 11 cases, Imperial was
required to make prepayments, with some exceptions, equal to 100%
of the net proceeds of the disposition of assets (including
proceeds from the sale of the equity securities of any subsidiary
of Imperial) plus 75% of excess cash above operations and other
obligations. In addition, Imperial was to maintain quarterly
compliance with certain financial covenants, including a maximum
ratio of total debt to EBITDA, as well as a minimum adjusted
current ratio, minimum fixed charge coverage ratio working
capital ratio, minimum leverage of net worth, and commencing in
December 2000, an interest coverage ratio and a minimum fixed
charge coverage ratio.

The Tranche A Term loans has a maturity date of December 31,
2003, while the Tranche B Term Loans matures December 31, 2005.
The Revolving Credit Facility currently matures December 31,
2002.

          Imperial Senior Subordinated Notes

Imperial Senior Subordinated Notes are unsecured publicly-traded
debt securities bearing interest at a rate of 9-3/4% per annum
and subordinated in priority of payment to all other unsecured
debt of Imperial other than trade and non-financial debt. The
United States Trust Company of New York currently serves as
Indenture Trustee for the Imperial Senior Subordinated Notes.

As of the Petition Date, Imperial was in default on these notes,
having failed to make the scheduled December 15, 2000, interest
payment. The trust indenture provides for a 30-day grace period
in connection with this default, which expired January 14, 2001,
shortly before commencement of these Chapter 11 cases.

          Industrial Development Bonds

The Debtors are obligated on approximately $25.1 million under
six series of industrial development bonds issues related to
capital projects in California, Florida, Indiana and Michigan.
$5.1 million of the bonds were scheduled to mature in fiscal
2001, and the remaining $20 million have maturity dates ranging
from 2015 to 2025. All six series of bonds initially were backed
by letters of credit issued under the Senior Credit Agreement.
Four of the series, however, have become unsecured in accordance
with their terms when the interest rates on the bonds converted
from a variable rate to fixed. The remaining two series of bonds,
related to projects in Visalia, California, and Indianapolis,
Indiana, continue to be backed by letters of credit. The Bank of
New York is the trustee on each series of bonds other than the
City of Indianapolis, Indiana bonds where the trustee is Chase
Corporate Trust. A total of $5.1 million of these bonds continue
to be backed by letters of credit under the Senior Credit
Agreement.

          Receivables Securitization Facility

Imperial is a party to a five-year Receivables Purchase
Agreement, expiring June 2004, with an independent issuer of
receivables-backed commercial paper under which Imperial and
certain subsidiaries are allowed to sell certain accounts
receivable on a non-recourse basis at a commercial paper discount
rate plus a margin of 0.7%. This Agreement requires compliance
with certain financial covenants, including a maximum receivables
delinquency rate. As of the Petition Date, Imperial had sold
$67.5 million in receivables under this Agreement. This Facility
is backed by a liquidity line of credit issued in favor of the
receivables purchases which expired on January 16, 2001, and
under the terms of applicable documents, terminated the Debtors'
right to sell receivables. However, as part of a proposed DIP
financing, this Agreement may be continued to August 31, 2001.

               Seasonal CCC Borrowings

The Debtors periodically incur seasonal, short-term borrowings
from the CCC, although no such borrowings were outstanding as of
the Petition Date, to help the Debtors meet seasonal working
capital needs. These borrowing needs generally peak during the
second fiscal quarter when inventory levels are high and a
substantial portion of payments to raw material suppliers needs
to be made. Under the Senior Credit Agreement, the Debtors'
borrowings from CCC generally were limited to $50 million
annually and reduced dollar for dollar the availability of
borrowings under the Revolving Credit Facility. An additional $25
million in borrowings from the CCC was permitted under the Senior
Credit Agreement between November 15 and march 15 of each year
without reduction of the availability under the Revolving Credit
Facility.

Borrowings from the CCC are secured by the Debtors' beet sugar
inventories. Under the Farm Bill, the USDA utilizes the import
quota and the forfeiture penalty to affect sugar price supports
and preent forfeitures under the CCC loan program, which has the
effect of limiting the total available supply of sugar in the
United States by setting a punitive tariff on all sugar imported
for domestic consumption that exceeds the determined permitted
imported quantity and is designed to make the importation of the
over-quota sugar uneconomical. CCC loans mature September 30 of
each year and in no event more than nine months after the month
in which the loan was made.

Under the Farm Bill, processors may forfeit sugar that secures
CCC loans to the USDA in lieu of repaying the loans. However,
where the forfeited amount is inadequate to cover the loan
amount, the USDA may proceed against the processor to recover the
deficiency. Additionally, a processor will be required to pay a
penalty of approximately one cent per pound of sugar forfeited.
From July to September 2000 a total of 598,000 short tons of
refined sugar and 305,000 STRV of raw sugar were forfeited by
various industry participants in full satisfaction of outstanding
loans from the CCC in lieu of repaying the loans. Imperial
forfeited 100,000 short tons of refined sugar in full
satisfaction of $47.1 million of CCC loans.

In addition, decreasing demand for refined sugar and attendant
decrease in prices prompted Imperial to sell refined sugar
totaling $31.2 million to the government under a USDA tender
program in the third quarter of 1999. This tender of refined
sugar to the government was sold at a loss of $2.4 million.

               SUMMARY OF THE PLAN

Under the terms of the Plan, and on its Effective Date:

      (a) All existing common stock shall be deemed cancelled and
void for all purposes, with the need for further action by the
Debtors or the Court;

      (b) Imperial will continue its business operations as
Reorganized Imperial. Its capital and debt structure will be
transformed by:

         (i) conversion of substantially all of the Debtors'
             funded unsecured debt to equity in Reorganized
             Imperial; and

        (ii) restructuring of substantially all of the Claims of
             the Bank Group.

      (c) Reorganized Imperial will be managed by the board of
directors of that entity in accordance with an Amended and
Restated Certification of Incorporation and Amended and Restated
Bylaws. The new board will consist of seven members, serving
staggered three-year terms. The initial board of directors' names
have not yet been disclosed by the plan proponents. Mr. Kempner
was nominated to serve on the board of Reorganized Imperial by
the current board. The remaining directors of the board of
Reorganized Imperial will be nominated by the Creditors
Committee.

      (d) The assets and liabilities of all of the Debtors will be
substantively consolidated for purposes of the Plan, voting,
confirmation and distributions. However, the Reorganized Debtors
will continue to maintain their corporate existences for all
purposes other than for purposes of confirmation, voting and
distribution.

      (e) Deferred Compensation Plans and supplemental executive
retirement plans of former employees will be terminated on the
Effective Date, and all holders of these claims, except for
Inactive Non-Qualified Benefits Convenience Claims, will receive
a pro rat distribution of New Common Stock in satisfaction of
these claims. Inactive Non-Qualified Benefits Convenience Claims
will be paid in full as these obligations mature.

      (f) All property of the Debtors' estates will revest in and
become the property of the Reorganized Debtors on the Effective
Date, subject to the Liens of the Bank Group under the Senior
Credit Facility, the DIP Facility, and the Amended Senior Credit
Agreement. This includes all claims and causes of action,
including any avoidance actions under the Bankruptcy Code.

The holders of certain classes of claims against the Debtors will
be unimpaired by the terms of the Plan. These are administrative
claims, unsecured claims entitled to priority, such as wages and
retirement benefits, secured claims other than those of the
Lenders discussed below, critical vendor claims, secured IDB
claims, retiree insurance benefits claims, "convenience claims",
Inactive Non-Qualified Benefits Convenience Claims, and
intercompany claims.

          Specific Treatment of Impaired Classes

Of the claims impaired by the Plan, the following classes and
treatments are proposed:

               Priority Claims

Each holder of a tax claim entitled to priority of payment under
the Bankruptcy Code will received deferred cash payments for the
full allowed amount of the claim, commencing ten days after the
Effective Date of the Plan, with the final payment made on the
sixth anniversary of the assessment date of the tax. However, the
Debtors have reserved the right to pay these claims without
penalty at the Reorganized Debtors' election.

          Senior Credit Agreement Claims

The principal changes of the plan restructuring of these
obligations are:

      1) An extension of the maturity date of the Tranche A Term
         Loan from December 31, 2003, to December 31, 2004;

      2) An extension of the maturity of the Tranche B Term Loans
         from December 31, 2005, to December 31, 2006;

      3) An extension of the maturity of the Revolving Credit
         Facility with respect to Participating Lenders from
         December 31, 2002, to September 30, 2004; and

      4) Delay of the amortization of the Tranche A Term Loan and
         Tranche B Term Loans through June 30, 2002.

In addition, the Amended Senior Credit Agreement will provide
that a minimum of 85% of the proceeds from asset sales will be
used to prepay claims of the Bank Group. All prepayments will be
applied to reduce back-end amortization.

Lenders will be able to elect for treatment of the claims under
the existing Revolving Credit Facility. If a lender elects to be
a Participating Lender and provide exit financing, that lender's
allowed secured claim will be paid in accordance with the above
terms. However, if a lender elects not to provide exist
financing, the Non-Participating Lender will receive a Non-
Participating Lender Note, amortized on a twenty-year schedule,
to be issued by Reorganized Imperial on the Effective Date of the
Plan in the amount of its allowed secured claim, providing for
payment of interest at the rate of 12% per annum and annual
payments of principal and interest under the note matures on the
tenth anniversary of the Effective Date. This note will continue
to be secured by existing liens and security interests.

          Replacement of Receivables Securitization Facility

A condition for consummation and effectiveness of the Plan is
that the Reorganized Debtors have procured a replacement for the
Receivables Securitization Facility which, in conjunction with
financing to be provided under the Amended Senior Credit
Agreement, is said by the Debtors to be sufficient to provide for
the working capital needs of the Reorganized Debtors.

          Trade and Other General Unsecured Claims, and
                   Equity Interest Holders

Holders of general unsecured claims, other than critical vendor
claims, "convenience claims", Inactive Non-Qualified Benefits
Convenience Claims, and Intercompany Claims, are to receive a pro
rata share of Class 5 New Common Stock in full satisfaction of
these claims. In effect, the plan converts these creditors to
equity stakeholders in Reorganized Imperial. The Plan also allows
the existing shareholders of Imperial (including persons who
exercise a right to acquire shares of existing common stock prior
to the Record Date), to participate. To effectuate this goal, all
existing common stock will be cancelled automatically as of the
Effective Date and the holders of allowed claims in this class,
and the holders of Interests in Imperial (if the holders of the
equity interest in the Debtors as of the Petition Date accept the
plan) are to be issued New Common Stock on the Effective Date.

         Allocation of New Common Stock between Unsecured
           Creditors and Equity Interest Holders

Reorganized Imperial will issue and distribute 10,000,000 shares
of new Common Stock on the Effect Date. Of these shares, at least
9,800,000 shares will be distributed on a pro rata basis to the
holders of allowed unsecured claims.

In addition, the holders of existing common stock will be
entitled to receive pro rata distribution of 200,000 shares of
New Common Stock if such holders vote, as a class, to accept the
Plan. If the holders of existing common stock vote instead to
reject the plan, the shares of New Common Stock which would have
been distributed to them had they accepted the plan will be
included in the pool of New Common Stock and distributed on a pro
rata basis to the holders of allowed unsecured claims.

Collectively, the shares of New Common Stock issued on the
Effective Date will represent 81% of the outstanding shares of
Reorganized Imperial on a fully diluted basis after exercise of
Warrants, as described below, and management options discussed
below. If no warrants are issued, the interest of unsecured
creditors in Reorganized Imperial will be 90% on a fully diluted
basis after exercise of management options.

Three groups of unsecured creditors are excluded from this
distribution and will not be converted from debt to equity. These
are the critical vendor claims, which may be paid in full under
the Debtors' Motion, as discussed below, and "Convenience
Claims". The latter group will be paid in full in cash on the
distribution date under the plan. Inactive Non-Qualified Benefits
Convenience Claims are also excluded form debt to equity
transactions.

"Convenience Claims" include not only unsecured claims of less
than $5,000, but also all unsecured claims (excluding bondholder
claims) of more than $5,000 whose holders voluntarily elect to
reduce their respective claims to $5,000. If such an election is
made, the claimholder will be deemed to have waived and released
any amount owed on the claim in excess of $5,000. Such election,
once made, will be irrevocable absent an Order of the Bankruptcy
Court.

          Warrants Distributed to Equity Interest Holders

If and only if holders of existing common stock vote, as a class,
to accept the plan, Reorganized Imperial also will issue, on a
pro rata basis, Reorganized Imperial Warrants representing the
right to acquire up to an additional 1,111,111 shares of new
Common Stock (equal to 9% of the total shares of New Common Stock
on a fully diluted basis after exercise of management options).
No such warrants will be issued, however, if the holders of
existing common stock vote, as a class, to reject the plan. If
issued, Reorganized Imperial Warrants would be exercisable
initially at a price provided in the Warrant Agreement and
not included in the Plan at this time. The Warrants will be
exercisable for a period of seven years from the Effective Date,
at which point they will expire.

No liquidation analysis is included with the Plan at this time.
Wasserstein Perella is putting the finishing touches on that
document and it will be filed before the Court convenes a
Disclosure Statement hearing.

               New Common Stock

The charter of Reorganized Imperial provides that the company
will have the authority to issue up to 50,000,000 shares of New
Common Stock. Of these authorized shares, 10,000,000 shares will
be issued on the distribute date under the Plan, together with
Warrants. An additional 246,914 shares of New Common Stock also
may be acquired through management options to be granted in the
future under the terms of the Reorganized Imperial Stock Option
Plan. This stock will have no par value. The new Common Stock
will be registered and listed to trade on the American Stock
Exchange or other comparable securities exchange.

               Management Options

The Reorganized Imperial Stock Option provides for the issuance
of Management Options to key management personnel giving such
persons the right to acquire up to an additional 1,234,568 shares
of New Common Stock. These options will be issued under and
governed by the terms of the Reorganized Imperial Stock Option
Plan. At this time the Stock Option Plan is not included with the
Reorganization Plan. Collectively the management Options
represent the right to acquire up to 10% of the outstanding
shares of Reorganized Imperial on a fully diluted basis assuming
the holders of existing equity interests vote, as a class, to
accept the plan, and 10% of the outstanding shares of Reorganized
Imperial if that class votes to reject to the plan. Of the shares
in this category, the Reorganized Imperial Stock Plan is said to
provide that Reorganized Imperial will grant options to purchase
987,654 shares to current officers and employees on the Effective
Date and will reserve 246,914 shares for future distribution in
accordance with the terms of the Plan.

          Treatment of Non-Qualified Benefits Claims

This group of claims will be treated in three separate ways.
Claims held by persons who were employed by one of the Debtors on
the Petition Date will be assumed by the Debtors, with payment as
the claim becomes due under the documents and applicable law,
provided that the holder of such a claim agrees in writing that
any retention bonus payments received under the terms of a
Management Retention Plan will be applied as a credit against and
reduce the Debtors' obligations with respect to the benefit
claim.

With respect to persons who were not employed by any of the
Debtors on the Petition Date, these claims will be treated as
Inactive Non- Qualified Benefits Claims and included with general
unsecured claims, or as Inactive Non-Qualified Benefits
Convenience Claims if the aggregate of monthly payments is less
than $1,000, or if the holder of a claim with $1,000 or more each
month agrees to reduce aggregate payments to $1,000 per month.
The election, when made, will be irrevocable absent an Order of
the Bankruptcy Court.

Allowed Inactive Non-Qualified Benefits Claims included in the
unsecured class will be paid through issuance of New Common
Stock. For purposes of determining the pro rata distribution of
the New Common Stock, the Allowed Non-Qualified Benefits Claims
will be assigned a present value.

Allowed Inactive Non-Qualified Benefits Convenience Claims will
not be affected by the Chapter 11 cases and will be paid by the
obligors on the claims in accordance with the agreements or law
giving rise to the claims, provided that any defaults, including
acceleration of the obligations upon occurrence of an event of
default, shall be cured on or before the Effective Date of the
Plan.

All Deferred Compensation Plans and supplemental executive
retirement plans of persons who were not employed by the Debtors
on the Effective Date will be rejected as of the Effective Date
of the Plan. (Imperial Sugar Bankruptcy News, Issue No. 2;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


INTEGRATED HEALTH: Heller Presses Debtors To Decide On Contracts
----------------------------------------------------------------
Heller Financial Leasing, Inc. told the Court that Heller is the
successor-in-interest to Dana Commercial Credit Corporation
(DCC), and DCC is the assignee of the unexpired executory Master
Product License Agreement dated December 2, 1997 between
Integrated Health Services, Inc. and PTL. Therefore, Heller
asserted that the Agreement was assigned to Heller on February
10,1998.

In this alleged capacity, Heller asked the Court to compel the
Debtors to assume or reject the Agreement and to pay all past due
and future rental payments under the Agreement to Heller, until
the Agreement is rejected.

Heller alleged that pre-petition, the Debtor entered into the
Agreement with PTI and DCC. Pursuant to the Agreement, the Debtor
leased the License from PTI and Heller is the successor in
interest to DCC and to PTI.

                    Debtors' Response

The Debtors related that pre-petition, IHS and Platinum
Technology, Inc. executed an agreement, dated December 2, 1997,
pursuant to which the Debtors purchased a perpetual, non-
exclusive license for the use of software and related products.
The Agreement consists of the Master Product License Agreement
Number 1997071805, including the Addendum and the Product
Schedule.

As consideration for the Products, the Debtors were to pay a
fixed dollar amount, which could either be paid in the form of a
lump sum or financed by Platinum's wholly-owned subsidiary,
Platinum Technology Financial Services and repaid by the Debtors
in three annual installments of $220,480 (plus applicable taxes
subject to the laws of the state in which the products are
installed) with the first payment due on January 3, 1998 followed
by equal installments due on the same day of each year hereafter.

The Debtors told Judge Walrath they elected to exercise the
finance option. Accordingly, they paid the first two installments
under the Agreement. The third installment, which became due on
January 3, 2000, that is, one month prior to the Filing Date, was
not paid.

In response to Heller's motion, the Debtors contend that while
the documents indicate that Heller may have been assigned certain
of the benefits under the Agreement, the actual Agreement itself
does not appear to have been assigned to Heller.

The Debtors pointed out that annexed to the Motion is an
agreement dated December 30, 1997, between Platinum and Heller,
which relates to various licensing agreements to which Platinum
is a party, presumably including the Agreement, but Heller's
Motion does not explain the relevance of the Platinum-Heller
Agreement to motion. The Debtors told Judge Walrath that they
assume, without conceding, that the Agreement is one of the
license agreements referenced in the Platinum-Heller Agreement,
but Heller should be put to its proof on this issue. The Debtors
further point out that none of the Debtors are parties to the
Platinum-Heller Agreement.

The Debtors also challenged Heller's assertion that the Agreement
was assigned to Dana Commercial Credit Corp. without providing
any supporting documentation or evidence.

The Debtors asserted that the Agreement is not an executory
contract, but is rather a prepetition purchase agreement, the
breach of which gives rise to a general unsecured claim.

The Debtors contended that they cannot be compelled to pay "past
due and future rental payments" pursuant to section 365(d)(10) of
the Bankruptcy Code because (i) that section only applies to
personal property leases but the Agreement is not; (ii) the
Agreement does not provide for the payment of rents; and (iii)
they have no payment obligations first arising from or after 60
days after the Filing Date.

Even assuming arguendo that the Agreement is an executory
contract within the meaning of section 365 of the Bankruptcy
Code, the Debtors go on, Heller has failed to demonstrate a valid
reason why the Debtors should be compelled to assume or reject
the Agreement within a shortened time period. Moreover, since the
Agreement itself was never assigned to Heller, the Debtors
argued, Heller has no standing to seek relief on the timing of
the Debtors' assumption/rejection decision.

Therefore, the Debtors conclude that the Motion should be denied
in its entirety. (Integrated Health Bankruptcy News, Issue No.
13; Bankruptcy Creditors' Service, Inc., 609/392-0900)


JITNEY JUNGLE: Designates Feb. 6 as Effective Date of Plan
----------------------------------------------------------
Jitney Jungle Stores of America, Inc. disclosed that it and its
nine affiliates have designated February 6, 2001 to be the
Effective Date of its Second Amended Joint Liquidating Plan of
Reorganization. The Plan, which had been approved on December 15,
2000 by the United States Bankruptcy Judge for the Eastern
District of Louisiana, was substantially consummated as of the
Effective Date. Jitney Jungle and its affiliates had filed
voluntary petitions on October 12, 1999 to seek protection under
Chapter 11 of the Federal Bankruptcy Code.

Michael Salvati at Jitney Jungle Stores of America, Inc., serves
as the, Plan Administrator.  Mr. Salvati can be reached at
601-965-8268.


LERNOUT & HAUSPIE: To Sell Mendez Unit By June 30
-------------------------------------------------
A consultant for Lernout & Hauspie Speech Products NV (L&H)
testified on Wednesday that the Mendez unit of the troubled
speech recognition company would be sold by June 30 for at least
$185 million, according to Reuters. In a day-long hearing before
bankruptcy Judge Judith Wizmur, Joseph D'Amico, a restructuring
specialist for Price Waterhouse, said part of the proceeds would
be used to repay L&H's proposed $60 million debtor-in-possession
(DIP) financing from Cerberus Capital Management LP. The final
form of the deal will be considered at a hearing tomorrow
(Tuesday).

According to D'Amico, in the next 13 weeks the debtor will have
to borrow $31 million to cover the difference between their
expenses and income over that period. L&H attorney Luc Despins
told Judge Wizmur that the company's current DIP lender, the GECC
financing unit of General Electric, would not allow L&H to draw
down the $10 million remaining in its DIP facility, an assertion
he explained to her off-the-record.

Dhruv Narain of Credit Suisse First Boston testified that he
expected Mendez to sell for at least $185 million, based on
initial offers by five unnamed European financial companies, and
that it was likely a higher price could be negotiated. He noted
that there was substantial interest in different pieces of the
combined technologies. Visteon Corp., a Ford Motor Co. spin off
and automotive components supplier, is a licensee of Dragon's C-
REC speech recognition technology and told Narain it may be
willing to pay $10 million to $15 million to buy it. (ABI World,
February 8, 2001)


LERNOUT & HAUSPIE: Inks $60MM DIP Pact with Ableco & Gabriel
------------------------------------------------------------
Troubled Belgian-American company Lernout & Hauspie Speech
Products NV asked the U.S. Bankruptcy Court Wednesday for
approval of a $60 million debtor-in-possession financing package
offered by Ableco Finance llc and Gabriel Capital Group,
TheDeal.Com states.

Lernout & Hauspie claimed that DIP financing was needed to
continue operations during their restructuring process under
Chapter 11 in the U.S. and Belgium.

The Deal.Com relates that Joseph D'Amico, a restructuring
consultant from PricewaterhouseCoopers, testified on behalf of
L&H and said that without the DIP financing, the company would
get no more funding and so would end up in liquidation. "These
companies cannot continue to operate without financing - none of
them," he said.

Mr. D'Amico also said that for L&H and its subsidiaries to meet
its Feb. 15 payroll, the court must approve the financing at the
next hearing.

Accordingly, L&H still has $700,000 of financing left from a GE
Capital Corp. bridge loan and other cash to fund operations until
the court rules.

Former majority stakeholders of Dictaphone Corp. and Dragon
Systems Inc., two L&H subsidiaries that were acquired last year,
objected to the DIP financing, according to TheDeal.Com. Also,
Stonington Partners and Janet and James Baker filed motions
before the court objecting to the terms of the said financing.
TheDeal.Com relates that these two investors have already been
burned badly by their acquisition deals with L&H. The value of
Stonington's and the Bakers' holdings in L&H reportedly plummeted
as its stock price slid from more than $70 a share to $4.50
before being delisted from both the Nasdaq and Easdaq markets.

Due to the ongoing arguments against the financing and the fact
that Ableco Finance has not completed due diligence on the loan
it offered L&H, U.S. Bankruptcy Court judge Judith Wizmer did not
rule on the request. The court is said to continue the hearing on
Feb. 13.

According to legal sources, while the financial pain for the
investors is intense, they expect the U.S. Bankruptcy Court to
approve the DIP financing and deny any requests for a reversal of
the deals, TheDeal.Com says.


LTV CORPORATION: Paying Employee and Contractor Wages & Salaries
----------------------------------------------------------------
Judge Bodoh authorized The LTV Corporation, in accordance with
their stated policies, as such policies may be amended from time
to time, and in their sole discretion, to pay prepetition
compensation, business expenses, deductions, withholdings and
benefits and accrued but remained unpaid as of the Petition Date
to or for the benefit of employees and independent contractors.
(LTV Bankruptcy News, Issue No. 3; Bankruptcy Creditors' Service,
Inc., 609/392-00900)


MARINER POST-ACUTE: Wants LCA To Assume & Assign Lease To LCEI
--------------------------------------------------------------
Debtor LCA Operational Holding Company, a Delaware corporation,
as successor in interest to Van-Care, Inc. (another Debtor in the
MPAN cases), currently leases from The Medical Clinic Board of
the City of Montgomery - Southside two facilities, known as The
Cedar Crest Nursing facility and The Cedars (Assisted Living
Facility), under a single lease.

The two Facilities are located next to each other at 3300
Lynchburg Road in a residential neighborhood in Montgomery,
Alabama. Cedar Crest is a 121-bed long-term care skilled-nursing
facility with occupancy rate of 93% and Cedars is a 61-bed
assisted living facility with occupancy rate of 92%
approximately. Both Cedar Crest and Cedars are profitable, with
annual earnings before interest, taxes, depreciation,
amortization, and rent (EBITDAR) of $1,993,000 and $ 340,000
respectively. Cedar Crest is well-constructed and well-managed,
while Cedars needs a basic cosmetic upgrade.

Marine Post-Acute Network, Inc. have determined that it is in the
best interest of the estates to assume the Lease and purchase the
Facilities by exercising a Purchase Option under the Lease at a
purchase option price of $500.

However, the licensed operator of the Facilities is LCEI, a
wholly-owned subsidiary of LCA and also a Debtor in the MPAN
cases. As a result of a series of mergers and name changes since
the Lease was executed, LCEI has now operated the Facilities for
a number of years under an unrecorded assignment of the Lease,
the documentation for which cannot now be located. The Debtors
believe that, because LCEI is currently the licensed operator of
the Facilities, the assignment of the Lease to LCEI is important
for the purpose of formalizing the de facto situation which has
existed for a number of years. Moreover, the assignment of the
Lease to LCEI will entitle the true operator of the Facilities to
exercise the Purchase Option and avoid any disruption in
operations as title to the Facilities transitions from the Board
to the existing operator.

Accordingly, the Debtors asked the Court to: (i) authorize LCA to
assume and assign the Lease to LCEI; (ii) authorize LCEI to
assume the Lease; and (iii) authorize LCEI to exercise its option
under the Lease to purchase the Facilities.

      The Lease, the Mortgage and Trust Indenture and the Bond

The Board purchased a portion of the real property on which the
Facilities are located in 1981 and financed this purchase by
issuing its First Mortgage Revenue Bonds (Cedar Crest Nursing
Home Project) Series 1981 Bonds.

In order to raise funds for completing the Project, the Board in
1985 refinanced the Series 1981 Bonds by issuing a $4.2 million
"First Mortgage Revenue Bond (VanCare, Inc. Project), Series
1985", under the "Mortgage and Trust Indenture" between the Board
and Southtrust Bank of Alabama, National Association, as Trustee.

The Indenture provides that the board is obligated to pay the
principal of and interest on the Series 1985 Bond over a period
of fifteen years, with the last payment, in the approximate
amount of $473,000 coming due on December 1, 2000. The Series
1985 Bond is secured by a mortgage from the Board on the real and
personal property relating to the Facilities, by an assignment in
favor of the Trustee of the Lease and rent payable by LCA, and
the pledge of gross revenues contained in the Lease, in addition
to a security interest in certain other real and personal
property.

VCI entered into the Lease on or about December 1, 1985. The
Board entered into the Indenture at the same time as it executed
the Lease. The Lease was intentionally structured to parallel the
payment schedule and certain other relevant provisions set forth
in the Indenture. Accordingly, like the Indenture, the Lease has
a 15-year term.

For the purpose of administrative convenience, the Lease provides
that LCA is obligated to pay rent at such times and in such
amounts as are sufficient to make all debt service payments on
the Series 1985 Bond directly to the Trustee on behalf of the
Board.

The Lease permits assignments of the Lease without the consent of
the Board, the Trustee or the holders of the Series 1985 Bond, so
long as the assigning lessee remains primarily liable under the
Lease.

The Debtors advised the Court that they have successfully made
all of the regular monthly payments throughout the Indenture and
Lease terms in amounts corresponding to the monthly payments due
under the Series 1985 Bond.

Over the last year, the monthly Lease payments have been
approximately $44,000 per month. However, the Final Lease
Payment, which is the amount of the balloon payment due on
December 1, 2000 on the Series 1985 Bond, is in the approximate
amount of $473,000.

               The Purchase Option

The Lease provides that, if LCA pays all the rent and other
amounts due under the Lease and pays off all of the Indenture
indebtedness, LCA may purchase the Facilities from the Board for
the nominal purchase price of only $500.

The Purchase Option remains in effect for sixty days after LCA
receives notice from the Board that the Lease has expired. LCA
must give the Board written notice of its decision to exercise
the Purchase Option at least thirty days prior to the proposed
effective date of the purchase. If LCA does not assume the Lease
and make the Final Lease Payment on or by December 1, 2000, or
during the subsequent five-day grace period for payment defaults
under the Lease, LCA will be in default under the Lease, which
may jeopardize its ability to exercise the Purchase Option.

The Debtors believe that the assumption of the Lease and purchase
of the Facilities is in the best interest of the Debtors' estates
because the Facilities are well-managed, profitable, and in good
physical condition. The Debtors submit that they have made all of
the required Lease payments over the fifteen-year term of the
Lease, so that the only remaining obligation is the Final Lease
Payment. (Mariner Bankruptcy News, Issue No. 12; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


METRICOM, INC.: Moody's Cuts Senior Debt Rating To Caa1
-------------------------------------------------------
Moody's Investors Service downgraded Metricom, Inc.'s:

      (a) 13% Senior Notes due 2010 to Caa1 from B3, and

      (b) senior implied rating to Caa1.

These ratings were placed on review for possible further
downgrade.

According to Moody's, downgraded ratings were due to the very
slow subscriber uptake for the service, the inability to attract
a larger number of reseller partners to distribute the service,
and the significant shortfall in network construction from
Moody's expectations when it assigned the ratings in January
2000.

It is said that, by the end of December 2000, Metricom had only
34,000 subscribers to its wireless data service that it offered
in 15 markets in the US covering approximately 48 million people.
This substantially falls short of Moody's expectations. Moody's
also relates that Metricom has consumed considerably more capital
than anticipated, despite this more limited deployment. Thus, the
company needs more funds to sustain operations beyond the middle
of this year.

Accordingly, Moody's review will focus on the company's ability
to secure additional financing to support its current base of
operations, and the viability of the service given its smaller
footprint. Moody's notes that the company has on deposit in a
restricted pledge account funds to secure the next three
scheduled interest payments for its $300 million Senior Notes.

Metricom, located in San Jose, California, provides mobile
wireless data access to corporate networks and the Internet.


NORTHPOINT COMMUNICATIONS: Shares Delisted From NASDAQ
------------------------------------------------------
NorthPoint Communications (Nasdaq: NPNTQ) has been delisted from
the NASDAQ Stock Market.

In a recent correspondence, NASDAQ expressed concerns about
NorthPoint Communications' ability to sustain compliance with its
listing requirement in light of its recent filing for protection
under Chapter 11 of the U.S. Bankruptcy Code on Jan. 16, 2001.

NorthPoint Communications was advised after the NASDAQ
announcement, that the company's common stock has begun trading
on the Electronic Pink Sheets under the symbol NPNTQ.

NorthPoint Communications Group, Inc. is one of the leading DSL
services providers in the U.S. The company currently operates
DSL-based local networks in 109 U.S. metropolitan statistical
areas (MSAs). For additional information, visit
http://www.northpoint.net


NORTHWESTERN STEEL: Gets Final Court Nod For $65 MM DIP Loan
------------------------------------------------------------
The U.S. Bankruptcy Court in Rockford, Ill., signed a final order
authorizing Northwestern Steel & Wire Co. to obtain secured post-
petition financing and to use cash collateral. The lenders and
their agent, Fleet Capital Corp., are authorized to advance up to
$65 million in DIP loans to Northwestern Steel which has agreed
to pay the monthly interest payments and daily principal payments
set forth in the pre-petition agreement. In its motion,
Northwestern Steel said that in the absence of debtor-in-
possession financing and the use of cash collateral, it wouldn't
be able to continue operations, which would result in "serious
and irreparable harm" to the company and its estate. (ABI World,
February 8, 2001)


ORBCOMM Global: Seeks Court Approval To Auction Ongoing Business
----------------------------------------------------------------
ORBCOMM Global, L.P., (ORBCOMM) the operator of the world's first
fully operational low-Earth orbit satellite- based data
communication system, is seeking bankruptcy court approval to
begin an auction process to sell the business as a going concern.
ORBCOMM has been operating under Chapter 11 protection since
September 15, 2000. During this period, ORBCOMM has continued to
provide uninterrupted data communication services to its
customers and business partners around the world. ORBCOMM
indicated that the prospective investors with whom it has held
meaningful discussions have expressed a strong desire to continue
providing data communication services to the company's customers.

"We believe that the best way to complete a transaction that
provides funding for ORBCOMM within our time requirements is to
begin an auction process now," said Scott L. Webster, ORBCOMM's
Chairman and Chief Executive Officer. "We have reserved what we
believe to be sufficient funds to retain our current staff and
support ongoing operations, so as to continue to provide service
to our customers during the auction period," Webster added.

ORBCOMM indicated that over the past eight months, it has
identified and educated a large number of potential financial and
strategic investors about the overall business potential of the
company. During this same period, ORBCOMM has also significantly
reduced expenses, signed on new customers, and continued to
provide high quality service to about 37,000 subscriber devices
in use around the world. The company also reported that the
satellite constellation, ground stations, customer solutions, and
distribution networks are all working well, and demand for
ORBCOMM service has remained strong as evidenced by the current
number of customers and network usage.

If ORBCOMM receives bankruptcy court approval for the auction, it
plans to issue an invitation to submit bids to prospective
bidders shortly thereafter. The auction process would then take
place during the rest of the month of February. After evaluating
all bids received, ORBCOMM would seek to obtain bankruptcy court
approval of what it concludes represents the "highest and best"
bid in early March, with the transaction closing shortly
thereafter.

ORBCOMM provides two-way monitoring, tracking and messaging
services through the world's first commercial low-Earth orbit
satellite-based data communication system. ORBCOMM applications
include tracking of mobile assets such as trailers, containers,
locomotives, rail cars, heavy equipment, fishing vessels, barges
and government assets; monitoring of fixed assets such as
electric utility meters, oil and gas storage tanks, wells and
pipelines and environmental projects; and messaging services for
consumers and commercial and government entities.


PILLOWTEX: Asks Court to Extend R. 9027 Removal Period to June 12
-----------------------------------------------------------------
Pillowtex Corporation asked Judge Robinson to extend the time
period during which they may remove pending civil and
administrative actions to the District of Delaware for further
litigation. As of the Petition Date, the Debtors were parties to
numerous civil actions pending in multiple courts and tribunals.

The Debtors asked that the Court extend the time within which
they must decide whether to remove a pending case to the District
of Delaware to the earlier of (a) June 12, 2001 or (b) 30 days
after entry of an order terminating the automatic stay with
respect to the particular action sought to be removed.

To determine whether to remove any particular action, the Debtors
explained that they must examine and evaluate a variety of
issues. At this early stage of their Chapter 11 cases, the
Debtors told Judge Robinson they have not yet had an opportunity
to evaluate these matters and determine which, if any, of the
actions they will seek to remove. As a result of the nature and
complexity of these cases, the Debtors have devoted substantially
all of their time and resources since the Petition Date to
completing the smooth transition to operations in Chapter 11. For
this reason, the Debtors have not had sufficient time to analyze
each of the actions and make the appropriate determinations
concerning their removal prior to the expiration of the current
90-day deadline. Accordingly, an extension of the time period
during which the Debtors may determine which actions, if any,
should be removed is warranted.

This extension will afford the Debtors a sufficient opportunity
to make fully-informed decisions concerning the removal of each
action and will assure that the Debtors do not prematurely
forfeit valuable rights. Further, the Debtors urged that an
extension would not prejudice the rights of the adverse parties
to the action. If the Debtors remove any action to federal court,
the affected adverse party will retain its right to seek remand
of the removed action back to state court. (Pillowtex Bankruptcy
News, Issue No. 4; Bankruptcy Creditors' Service, Inc., 609/392-
0900)


PLAY-BY-PLAY: Debt Restructuring Talks with Convertibles Collapse
-----------------------------------------------------------------
Play-By-Play Toys & Novelties, Inc. (Nasdaq: PBYP) was unable to
reach an agreement with the holders of its Convertible Debentures
to extend the final maturity of the Convertible Debentures prior
to the expiration of the February 2, 2001 forbearance deadline.

The Debentures, with a current principal balance outstanding of
$14.6 million, were originally scheduled to mature on June 30,
2004; however, in October 1999, the Company restructured the
debentures and agreed to accelerate the final maturity to
December 31, 2000. The Company had secured forbearance of the
final maturity from the holders until February 2, 2001; however,
the Company was unable to secure an additional forbearance of the
final maturity. The Company remains in negotiations with the
holders of its existing Convertible Debentures relative to
modifying or restructuring the terms of the debentures, including
an additional extension of the final maturity date. However, if
the Company is unable to refinance or restructure the debt, the
holders of the Convertible Debentures have the contractual right
to control the Company's Board and have the right to convert
their debt to the Company's common stock at the average closing
stock price for the month of December 2000. They can also demand
payment of the outstanding indebtedness; however, they would be
unable to take legal action against the Company for a period of
six months without the consent of the Company's senior lender.


PLAY-BY-PLAY: Cuts 50 Corporate Jobs to Immediately Reduce Costs
----------------------------------------------------------------
Play-By-Play Toys & Novelties, Inc. announced that it has
eliminated 50 positions at its corporate headquarters and
distribution center located in San Antonio, Texas and has plans
to eliminate additional positions at its distribution centers
located in Los Angeles, Chicago and Puerto Rico as part of its
ongoing restructuring and cost saving initiatives.

To further reduce operating costs, the Company ceased stuffed toy
production operations at its San Antonio distribution facility
and will consolidate production at its facilities in Los Angeles
and Chicago. The Company is also finalizing plans for the
consolidation and elimination of excess distribution capacity at
its Los Angeles, Chicago and San Antonio distribution centers in
efforts to achieve additional cost savings. The Company recently
closed two distribution centers, one located in Miami, Florida
and the other located in Woodinville, Washington.

Arturo G. Torres, Chairman and Chief Executive Officer commented,
"While the personnel reductions we are making are painful, they
are necessary given the Company's current financial situation. We
are committed to making the changes required to return this
Company to more prosperous times."


PLAY-BY-PLAY: Restructures Licensing Agreements With Warner Bros.
-----------------------------------------------------------------
Play-By-Play Toys & Novelties, Inc. has finalized an agreement
with Warner Bros. Consumer Products that preserves the Company's
licensing rights for several popular Looney Toons characters in
Europe, Latin America and the United States until December 31,
2002 and provides for the rescheduling of the payment of royalty
obligations on terms more favorable to the Company.

Play-By-Play Toys & Novelties, Inc. designs, develops, markets
and distributes a broad line of quality stuffed toys, novelties
and consumer electronics based on its licenses for popular
children's entertainment characters, professional sports team
logos and corporate trademarks. The Company also designs,
develops and distributes electronic toys and non-licensed stuffed
toys, and markets and distributes a broad line of non-licensed
novelty items. Play-By-Play has license agreements with major
corporations engaged in the children's entertainment character
business, including Warner Bros., Paws, Incorporated, Nintendo,
and many others, for properties such as Looney Tunes(TM),
Batman(TM), Superman(TM), Scooby-Doo(TM), Garfield(TM) and
Pokemon(TM).


RELIANT ENERGY: Fitch Gives BBB+ Rating to New Debt Offering
------------------------------------------------------------
Fitch assigned a 'BBB+' rating and a Rating Watch Negative to
Reliant Energy Resources Corp.'s (RERC) $600 million Rule 415
debt shelf registration and expected issuance of up to $500
million of senior unsecured debt securities. In addition, RERC's
outstanding 'BBB+' senior notes and debentures and 'BBB'
convertible subordinated notes and trust preferred securities are
placed on Rating Watch Negative.

A Rating Watch Negative indicates that ratings could be lowered
or affirmed as a result of a specific development in the near
term. RERC (formerly NorAm Energy Corp.) is a wholly owned
subsidiary of Reliant Energy, Inc. (REI) and is engaged primarily
in the business of natural gas distribution, interstate
transmission and gas gathering.

Also, Fitch revised the status of REI's long-term credit ratings
to Rating Watch Negative from Rating Watch Evolving where they
were placed on July 27, 2000. The rating action for both REI and
RERC follows Fitch's review of management's plan to split REI
into two separate publicly traded companies by year-end 2001.
Rating actions for RERC are expected to occur by the end of 2001
upon the full spin-off of REI's domestic non-regulated and
European based operations, which will be held by a new company,
Reliant Resources, Inc. (RRI). Upon completion of the spin-off,
Fitch expects to lower RERC's outstanding senior notes and
debentures to 'BBB' and its convertible subordinated notes and
trust preferred securities to 'BBB-'. In addition, RERC's
commercial paper program is expected to be affirmed at 'F2'.

Upon completion of the spin-off of RRI, RERC is expected to
become a first tier operating subsidiary of a new SEC-registered
holding company (referred to as Regco) for REI's regulated
electric and gas businesses. Although RERC's standalone credit
profile is expected to remain largely unchanged under the new
structure, Fitch anticipates lowering RERC's long-term ratings
due to the added financial pressure resulting from increased debt
leverage at Regco, which is projected to remain above 80% for the
next several years. In particular, there are no general legal
restrictions that prevent the payment of dividends by RERC to
Regco and/or REI. A positive consideration is the recent transfer
of higher risk energy marketing and trading activities from RERC
to the newly formed RRI. This reduces business risk and results
in a more predictable cash flow stream at RERC as its operations
will now be focused primarily on regulated natural gas
distribution and interstate pipeline operations. Post-
restructuring, RERC's individual capital structure, including
short-term borrowings is expected to approximate 52% debt and 48%
equity. Assuming normal weather and favorable market conditions
for RERC's two interstate natural gas pipeline subsidiaries,
Reliant Energy Gas Transmission and Mississippi River
Transmission, pretax interest coverage and cash coverage of
interest should range above 2.3 times (x) and 3.0x, respectively.


RIVERSIDE GROUP: Default on 11% Notes Triggers Cross-Default
------------------------------------------------------------
Riverside Group, Inc. (OTC Bulletin Board: RSGI) announced that
it failed to make required payment on its 11% Secured Notes which
was due December 31, 2000. Riverside has received notice from the
agent for the noteholders declaring all amounts outstanding under
the notes immediately due and payable. Riverside has also been
advised that the agent will immediately commence foreclosure
proceedings on the collateral securing the notes. The collateral
includes certain real estate assets of Riverside and shares of
Wickes, Inc. and Greenleaf Technologies Corporation. The failure
to pay the 11% notes when due also constitutes a default under
Riverside's $7 million mortgage loan obligations to American
Founders Life Insurance Company.

Riverside has been negotiating a possible resolution with the
holders of the 11% notes, and such negotiations are continuing.
However, there can be no assurance that Riverside will be able to
reach a mutually acceptable resolution.


SAFETY-KLEEN: Enters Into New South Carolina Office Leases
----------------------------------------------------------
Safety-Kleen Corp. requested Judge Walsh's authority to enter
into two leases of non-residential real property currently
occupied by the Debtors and located at 1301 Gervais Street,
Columbia, South Carolina, and The Capitol Center, 1201 Main
Street, Columbia, South Carolina with Parkway Properties, Inc., a
Delaware limited partnership. These properties are currently
occupied by the Debtors' information technology and tax
departments, as well as the senior management of the Debtors'
Sales and Service Division. The existing leases expired as of
December 31, 2000.

The Debtors therefore urged Judge Walsh to approve this motion,
saying it is imperative that Services be authorized to enter into
new leases promptly in order to avoid the significant disruption
in the Debtors' businesses that would otherwise result.

Each of the Leases is a traditional lease, pursuant to which the
Landlord is responsible for paying all operating expenses, such
as taxes, insurance, utilities and repairs. The other salient
terms of the Leases are summarized below.

               The Gervais Street Lease

The Gervais Lease covers three separate office suites, totaling
approximately 15,178 rentable square feet in the Debtors'
corporate headquarters building. The Debtors currently use, and
intend to continue to use, the Gervais Premises for general
office purposes, including, but not limited to, offices for the
Debtors' information technology and tax departments, as well as
for the IT department's equipment storage and staging area.

The most pertinent terms of the Gervais Lease are:

      Term:                 3 years (1/l/01--12/31/03)

      Rent:                 Year 1: $20,237.33 per month
                            Year 2: $20,553.54 per month
                            Year 3: $20,869.75 per month

      Security Deposit:     $0

      Right to Extend:      Services will have the right to extend
                            for one (1) period of two (2) years,
                            commencing January 1, 2004 and
                            expiring December 31, 2005, in which
                            case the rent will be $22,134.58 per
                            month for each year so extended.

      Right to Terminate:   Services may terminate the lease upon
                            six months written notice to the
                            Landlord, which termination right may
                            initially be exercised after July 1,
                            2002. if Services elects to so
                            terminate, it will incur a
                            cancellation penalty calculated as six
                            times the monthly rent in effect on
                            the date of termination.

      Rights of Reduction:  Services will have two separate rights
                            to reduce the rentable square feet of
                            the Gervais premises (by a total of
                            1,669 rsf) upon thirty days writ- ten
                            notice to the Landlord, and without
                            penalty.

               The Capitol Center Lease

The Capitol Center Lease covers a single office suite comprised
of approximately 20,399 rentable square feet. The Debtors
currently use, and intend to continue to use, the Capitol Center
Premises for general business purposes, including offices for the
senior management of their Sales and Service Division.

The most salient terms of the Capitol Center Lease are:

      Term:                 3 years (1/l/01--12/31/03)

      Rent:                 Year 1: $28,898.58
                            Year 2: $29,323.56
                            Year 3: $29,748.54

      Security Deposit:     $0

      Right to Extend:      Services will have the right to extend
                            the Capitol Center Lease for one
                            period of two years, commencing
                            January 1, 2004 and expiring December
                            31, 2005, in which case, the rent will
                            be $31,448.46 per month for each year
                            so extended.

      Right to Terminate:   Services may terminate the Capitol
                            Center Lease upon six months written
                            notice, which termination right may
                            initially be exercised after July 1,
                            2002. If Services elects to terminate,
                            it will incur a cancellation penalty
                            calculated as six times the monthly
                            rent in effect on the date of
                            termination.

The Debtors told Judge Walsh that they believe that entry into
these leases may be done in the ordinary course of Services'
business; however, out of an abundance of caution and because
Services' future expenditures for, among other things, office
space is a matter of importance to its creditors and other
parties in interest, the Debtors brought this Motion seeking an
Order authorizing them to enter into these leases. The Debtors
undertook a comprehensive search for alternative space to these
leased premises, but have determined that these leases are not
only less expensive, but of higher quality, than other spaces
reviewed.

Taking heed of the Debtors' stated need for speed, Judge Walsh
entered an Order authorizing the Debtors' entry into the Gervais
and the Capital Center leases upon the terms stated. (Safety-
Kleen Bankruptcy News, Issue No. 13; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


SUNBEAM CORP.: Review & Summary of $285,000,000 DIP Facility
------------------------------------------------------------
Sunbeam Corporation and substantially all of its debtor-
subsidiaries, as guarantors, are obligated, jointly and
severally, to repay approximately $1,665,000,000 owed under the
1998 Prepetition Credit Facility to Morgan Stanley Senior
Funding, Inc., Bank of American, N.A., and First Union National
Bank.  The Debtors' obligations to the Prepetition Lenders under
the Prepetition Credit Facility are secured by a pledge of the
stock of substantially all of the Debtors and by liens on and
security interests in substantially all of the assets of Sunbeam
Corporation and the Debtor Guarantors.

The Debtors urgently require working capital to continue their
operations. In the ordinary course, the Debtors' working capital
requirements are satisfied through cash generated by the
operation of their businesses and financing provided through
their parent, Sunbeam Corporation. The uncertainty concerning
Sunbeam's financial condition has curtailed the Debtors'
availability of trade credit and acceptable credit terms and
limits. A steady and continual stream of raw materials used to
manufacture finished goods is essential to the maintenance and
enhancement of the Debtors' businesses. If the Debtors are unable
to obtain sufficient inventory, products and merchandise to
manufacture household and outdoor leisure products and supply
their retail customers, it may result in a permanent and
irreplaceable loss of business, to the detriment of Sunbeam and
all parties in interest.

In order to continue to operate their businesses following the
commencement of these chapter 11 cases, the Debtors have
determined, in the exercise of their sound business judgment,
that a postpetition credit facility which permits Sunbeam
Corporation and the Debtors, through Sunbeam Corporation, to
obtain up to $285,000,000 in funds is critical. Prior to the
Commencement Date, the Debtors and Sunbeam Corporation surveyed
various sources of postpetition financing. Because the
Prepetition Lenders have an extensive knowledge of the Debtors'
businesses and maintain liens on and security interests in
substantially all of the assets of Sunbeam Corporation and the
Debtors, Sunbeam Corporation and the Debtors concluded that
debtor-in-possession financing from the Prepetition Lenders
presented the best option for the preservation of the Debtors'
businesses. The proposal received from the Prepetition Lenders is
competitive and, together with availability to be provided under
a proposed postpetition receivables financing program with
General Electric Capital Corporation addresses the Debtors'
working capital and liquidity needs.

Prior to the Petition Date, Sunbeam engaged in extensive good
faith, arm's-length negotiations with the Prepetition Lenders.
These negotiations culminated in an agreement by the Prepetition
Lenders to provide postpetition financing to Sunbeam Corporation
on the terms and subject to the conditions set forth in the
Revolving Credit and Guarantee Agreement dated as of February 6,
2001, among First Union National Bank, as administrative agent,
and the lenders parties thereto from time to time.

The significant elements of the DIP Financing Documents are:

      (a) Borrower. Sunbeam Corporation.

      (b) Guarantors. All of the Sunbeam Debtors and, to the
extent set forth in the DIP Loan Agreement and requested, certain
non-debtor domestic subsidiaries and Foreign Subsidiaries.

      (c) Administrative Agent. First Union National Bank.

      (d) DIP Lenders. The Prepetition Lenders -- Morgan Stanley
Senior Funding, Inc., Bank of American, N.A., and First Union
National Bank -- and their respective permitted assignees.

      (e) DIP Commitments. The DIP Loan Agreement provides for
a total commitment of $285,000,000, with a $120,000,000 sublimit
for letters of credit. The letters of credit outstanding under
the Prepetition Credit Facility on the Commencement Date shall be
rolled into the DIP Facility.

      (f) Interim Advance. The DIP Loan Agreement provides for
an interim advance of $200,000,000, with a $110,000,000 sublimit
for letters of credit.

      (g) Term. The DIP Facility shall be available on a revolving
basis during the period beginning on the Closing Date and ending
on the earliest of (a) the date that is one year after the
Commencement Date, (b) the Termination Date and (c) the effective
date of a plan of reorganization in Sunbeam Corporation's Chapter
11 case, at which time the Loans shall be paid in full, any then
outstanding Letters of Credit shall be replaced or cash
collateralized and the Commitments shall terminate.

      (h) Use of Proceeds. The proceeds of the loans and letters
of credit under the DIP Facility shall be used (a) to repay any
Supplemental Revolving Loans under the Prepetition Credit
Facility outstanding on the Commencement Date and (b) in
accordance with a strict Budget, for working capital and other
general working capital needs of Sunbeam Corporation and the
Debtors, including to pay chapter 11 expenses, and to pay any
prepetition cash management losses of any DIP Lender.

      (i) Collateral/Priority. For all obligations under the DIP
Facility (including without limitation any DIP Lender's exposure
on account of cash management arrangements), the DIP Lenders
shall be secured by: (a) first liens on all unencumbered property
of the Debtors and Sunbeam Corporation, including 100% of the
stock of the first-tier Foreign Subsidiaries and the other stock
of foreign subsidiaries and foreign subsidiary assets to be
perfected under foreign law, if reasonably requested by the
Administrative Agent, including, to the extent set forth in the
Final Order, avoidance actions, (b) priming liens on all
collateral securing the Prepetition Credit Facility and (c)
junior liens on all property subject to a valid third party lien,
(d) superpriority claims on customary terms and conditions and
otherwise satisfactory to the Required DIP Lenders. Liens and
superiority claims shall be subject to a carve-out for (a) the
U.S. Trustee and court fees and (b) up to $3,000,000 after the
occurrence and during the continuance of an event of default, for
professionals retained by the Debtors, Sunbeam Corporation and
any committee. Prior to the occurrence and continuance of an
event of default, professional fees shall not reduce the carve-
out but shall be subject to the Budget.

      (j) Interest. Advances under the DIP Loan Agreement will
bear interest at a rate equal to the Base Rate plus 2.50% or, at
Sunbeam Corporation's election, the Eurodollar Rate plus 3.50%,
in either case, payable monthly in arrears.

      (k) Mandatory Commitment Reductions/Prepayments. The
aggregate Commitments under the DIP Facility shall be permanently
reduced by 100% of the net cash proceeds from asset sales outside
of the ordinary course of business. The aggregate Commitments,
and the aggregate Loan Sublimit, under the DIP Facility shall be
permanently reduced to $160,000,000 on April 30, 2001 (unless
already reduced by at least that amount by such date as a result
of consummation of asset sales).

There shall be a daily sweep of all cash in the concentration
account in excess of $15,000,000 to prepay outstanding loans,
without a corresponding permanent reduction in the Commitments.

      (l) Financial Covenants. The Debtors and Sunbeam Corporation
covenant with the Lenders that:

            (a) At the last day of each calendar month set forth
                below, Consolidated EBITDA for the period from
                January 1, 2001 through the last day of each month
                set forth below shall not be less than the amount
                set forth below opposite such month:

                       Month                   Consolidated EBITDA
                       -----                   -------------------
                     January, 2001                  ($11,000,000)
                     February, 2001                 ($11,000,000)
                     March, 2001                      $5,000,000
                     April, 2001                     $20,000,000
                     May, 2001                       $32,000,000
                     June, 2001                      $44,000,000
                     July, 2001                      $50,000,000
                     August, 2001                    $62,000,000
                     September, 2001                 $79,000,000
                     October, 2001                   $96,000,000
                     November, 2001                 $111,000,000
                     December, 2001                 $116,000,000
                     January, 2002                  $111,000,000

           (b) a Budget, to be tested at the end of each calendar
               month;

           (c) Consolidated Capital Expenditures at any time
               during each of the periods set forth below will not
               exceed the amount set forth below opposite such
               period:

                        Period                       Amount
                         ------                      ------
               January 1, 2001 - January 31, 2001     $6,000,000
               January 1, 2001 - February 28, 2001   $11,000,000
               January 1, 2001 - March 31, 2001      $16,000,000
               January 1, 2001 - April 30, 2001      $21,500,000
               January 1, 2001 - May 31, 2001        $26,000,000
               January 1, 2001 - June 30, 2001       $31,500,000
               January 1, 2001 - July 31, 2001       $37,000,000
               January 1, 2001 - August 31, 2001     $41,000,000
               January 1, 2001 - September 30, 2001  $45,500,000
               January 1, 2001 - October 31, 2001    $50,000,000
               January 1, 2001 - November 30, 2000   $54,500,000
               January 1, 2001 - December 31, 2001   $60,000,000
               January 1, 2001 - January 31, 2002    $66,000,000

           (d) At the last day of each calendar month set forth
               below, the aggregate amount of accounts payable due
               from the Borrower and its Subsidiaries (other than
               Foreign Subsidiaries) to their respective suppliers
               and vendors will not be less than the amount set
               forth below opposite such month:

                     Month                Minimum Accounts Payable
                     -----                ------------------------
                     February, 2001                 $100,000,000
                     March, 2001                    $115,500,000
                     April, 2001                    $112,000,000
                     May, 2001                      $115,500,000
                     June, 2001                     $118,000,000
                     July, 2001                     $129,500,000
                     August, 2001                   $134,500,000
                     September, 2001                $134,400,000
                     October, 2001                  $119,000,000
                     November, 2001                 $106,000,000
                     December, 2001                 $107,000,000
                     January, 2002                  $131,000,000

           (e) At the last day of each calendar month, the
               aggregate amount of intercompany receivables
               incurred after the Petition Date due from Foreign
               Subsidiaries to the Debtor Loan Parties will not
               exceed the amount set forth below opposite such
               month.

                                            Maximum Amount of
                       Month             Intercompany Receivables
                       -----             ------------------------
                   February, 2001                  $38,500,000
                   March, 2001                     $58,500,000
                   April, 2001                     $36,500,000
                   May, 2001                       $39,000,000
                   June, 2001                      $31,000,000
                   July, 2001                      $22,500,000
                   August, 2001                    $13,500,000
                   September, 2001                 $11,500,000
                   October, 2001                    $9,500,000
                   November, 2001                   $4,000,000
                   December, 2001                   $1,000,000
                   January, 2002                   $10,000,000

      (m) Fees and Expenses. Sunbeam Corporation is obligated to
pay:

           * A facility fee of 2.0% of the Commitments, payable on
             the Closing Date.

           * A commitment fee of 0.50% per annum on the average
             daily unused portion of the Commitments, payable
             monthly in arrears.

           * A Letter of Credit Fee of 3.50% on the face amount of
             the each such Letter of Credit (inclusive of a 0.25%
             fronting fee to the issuing bank), payable monthly in
             arrears.

           * An annual administrative agent's fee of $200,000.

      (n) Milestone Covenants.  The Debtors agree to three key
milestones in the course of their chapter 11 restructuring:

           (1) Approval on or before March 31, 2001 of a
               disclosure statement, in form and substance
               satisfactory to the Required Lenders and the
               Required Prepetition Lenders, with respect to the
               Borrower Plan of Reorganization and the
               Subsidiaries Plan of Reorganization.

           (2) Confirmation on or before June 15, 2001 by the
               Bankruptcy Court of the Borrower Plan of
               Reorganization and the Subsidiaries Plan of
               Reorganization.

           (3) Occurrence by July 1, 2001 of the effective date
               under the Borrower Plan of Reorganization and the
               Subsidiaries Plan of Reorganization.

Sunbeam tells the Court that its full working capital needs can
only be satisfied if Sunbeam Corporation is authorized to borrow
up to $285,000,000 under the DIP Loan Agreement and to use such
proceeds to fund the operations of the Subsidiaries and the
Foreign Subsidiaries. The credit provided under the DIP Loan
Agreement will enable the Debtors to obtain raw materials and
services in connection with their manufacturing operations,
obtain finished goods from suppliers, obtain necessary services
such a s maintenance and shipping, pay their employees and
operate their businesses in an orderly and reasonable
manner to preserve and enhance the value of their assets and
enterprise for the benefit of all parties in interest. The
availability of credit under the DIP Loan Agreement will give the
Debtors' vendors and suppliers the necessary confidence to resume
ongoing credit relationships with the Debtors. Finally, the
implementation of the DIP Loan Agreement will be viewed favorably
by all of the Debtors' employees, customers and creditors and
thereby help promote the Debtors' successful reorganization.

The terms and conditions of the DIP Loan Agreement are fair and
reasonable, Sunbeam is convinced, and were negotiated by the
parties in good faith and at an arms' length.  Accordingly, the
lenders under the DIP Loan Agreement should be accorded the
benefits of section 364(e) of the Bankruptcy Code in respect of
such agreement.  The Prepetition Lenders concur with the Debtors'
assessment that approval of the DIP Financing Documents is in the
best interests of the Debtors and their creditors. Such approval
will enable the Debtors to operate their businesses and enhance
values, to the benefit of all parties in interest.

The Debtors have an urgent and immediate need for cash to
continue to operate their businesses. Without cash to pay
vendors, the Debtors will be unable to fulfill orders to retail
customers. Unfulfilled orders may result in the permanent erosion
of the Debtors' customer base, to the detriment of all parties in
interest. The Debtors estimate that Sunbeam needs up to
$200,000,000 over the next 20 days in order to operate in the
ordinary course of business and pay down required amounts and
letters of credit under the Prepetition Credit Facility. The
Debtors' businesses and properties will be immediately and
irreparably harmed absent authorization from the Court to use
cash collateral and obtain secured credit, as requested, on an
interim basis pending a final hearing on the Motion. The
$200,000,000 amount is required, on an interim basis, due to the
fact that Sunbeam recently has commenced its seasonal inventory
build, resulting in increased working capital requirements. In
the short term, if the Debtors are unable to provide retailers
with a continuous supply of product, competitors will capitalize
on their inability to promptly fulfill the demands of their
customer base, which will likely have a long term negative impact
on the value of the Debtors' businesses, to the detriment of all
parties in interest.

As previously reported in the Troubled Company Reporter, Sunbeam
filed for chapter 11 protection and presented the U.S. Bankruptcy
Court for the Southern District of New York with a prearranged
plan of reorganization on February 6, 2001.  Harvey R. Miller,
Esq., and Marc D. Puntus, Esq., at Weil, Gotshal & Manges LLP,
represent Sunbeam.  Steven M. Fuhrman, Esq., at Simpson Thacher &
Bartlett, and Chaim Fortgang, Esq., at Wachtell, Lipton, Rosen &
Katz, represent Sunbeam's Bank Lenders.


SUN HEALTHCARE: Rejects Forklift Lease With Associates Leasing
--------------------------------------------------------------
Associates Leasing complained to the Court that Debtor Contour
Medical, Inc. has not performed its obligations under the leases
in making rental payments for forklifts. Accordingly, Associates
Leasing, Inc. asked the Court to compel Sun Healthcare Group,
Inc. to assume or reject unexpired leases of eight forklifts for
use in connection with the Debtor's business.

Pursuant a Master Rental Agreement and Rental Supplement
Agreements, Contour Medical leases certain forklifts from
Associates and is obligated to make a monthly rental to
Associates in the amount of $3,280 each month for sixty months.
As of the Petition Date, Debtor was due for the monthly rental
payments in the total amount of $9,840. Debtor has made most of
its post-petition monthly rental payments through the November 1,
2000 payment.

Subsequent to Associate Leasing's motion, the parties agreed that
the motion is granted and the Lease shall be deemed rejected
effective January 19, 2001.

Pursuant to the Stipulation and Order, Debtor will make
arrangements for and allow Associates to retrieve the forklifts
and Associates is granted relief from the automatic stay to
retake possession of the forklifts, if necessary.

Associates shall be allowed an administrative claim against
Debtor's estate pursuant to 11 U.S.C. section 503(b) in the
amount of $6,560 representing a claim for Monthly Rentals for
December 2000 and January 2001.

To the extent that Medical Contour retains possession of the
forklifts beyond the rejection date, Associates will have the
right to file an application for administrative claim and Debtor
will retain its right to object.

Moreover, Associates will retain its right to file an unsecured
claim based upon the lease rejection and will file such claim
within sixty days of the date of the entry of the Court's order.
(Sun Healthcare Bankruptcy News, Issue No. 18; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


SUNSHINE MINING: Emerges From Bankruptcy
----------------------------------------
Sunshine Mining and Refining Company (OTCBB:SSCF) announced that
its Third Amended Plan of Reorganization had become effective as
of February 5, 2001, allowing the Company to emerge from
bankruptcy.

As a result of the effectiveness of the Plan of Reorganization
and the Order of Confirmation issued by the U.S. Bankruptcy
Court:

      --  The "old common stock" of Sunshine was cancelled (as are
          all issues of previously issued warrants). Common
          stockholders with more than 100 shares of "old common
          stock" in their accounts as of the Effective Date will
          receive a pro rata distribution of approximately 3.4% of
          the "new common stock."
          Of the total new shares of stock outstanding (50 million
          shares) "old common stock" holders will receive
          approximately 1.7 million shares. (In other words, a
          holder of 1,000 shares of "old common stock" will
          receive approximately 35 shares of "new common stock.")
          No action by holders of "old common stock" is required.
          The Company will make an announcement when the new
          shares are delivered and available to trade.

      --  All of the Company's pre-bankruptcy funded debt and
          certain other liabilities (totaling approximately $49
          million) were cancelled and converted to equity.

      --  Approximately 90% of the new common stock will be held
          by affiliates of Elliott Associates, L.P. and Stonehill
          Capital Management LLC. They have appointed four members
          to the Company's five-member Board of Directors. In
          addition, the principal stockholders have a Call Option
          which allows them, upon the occurrence of certain
          adverse events, to acquire Sunshine Argentina, the owner
          of the Pirquitas Mine in Argentina, the Company's
          principal asset.

      --  Mr. William W. Davis became President, Chief Operating
          Officer and Chief Financial Officer. Mr. John S. Simko
          became Chairman of the Board of the Company, and the
          Company's principal executive office was moved to
          Dallas.

      --  The Company settled all of its environmental litigation
          in the Coeur d'Alene basin brought by the United States
          Department of the Interior, the EPA, and the Coeur
          d'Alene Tribe. The plaintiffs in this action had alleged
          up to $3 billion in natural resource damages against the
          defendants. The Company's release from this litigation
          removes a major uncertainty. The Company was also
          released from a 1994 Consent Decree which obligated it
          to remediate certain property in the Bunker Hill
          Superfund Site. In consideration for the releases, the
          Company has agreed to issue the plaintiffs ten-year
          warrants to acquire up to 4.975 million shares of the
          Company's stock at a strike price of $.66 per share; to
          deed to the plaintiffs certain timberland it owns in
          North Idaho; to pay a sliding scale royalty commencing
          at silver prices in excess of $6.00 per ounce on
          production from the Sunshine Mine; and to perform
          certain test work and remediation at the Con Sil mine
          site.

In another recent development, Sunshine has just been advised by
its primary customer that the smelter to which the Sunshine Mine
had been shipping its concentrates will close and is accepting no
more deliveries. Given continuing low silver prices and the cost
of developing access to additional reserves at the Sunshine Mine,
the Company does not feel that restarting its own refinery is
economically warranted at this time. The Company is analyzing
available alternatives for the sale of its concentrates from the
Sunshine Mine, but available markets in North America are
limited. If economically viable commitments are not in hand
shortly, the Company will commence the process of closing the
mine.

If the mine is closed, it likely will be placed on a care and
maintenance status pending an improvement in silver prices.
Having produced over 350 million ounces of silver in its more
than 100 year history, with significant areas as yet undeveloped,
the mine represents an extremely attractive exploration
opportunity.

The Company is funding operations with a $5 million credit
facility provided by its principal stockholders, which is also
being used to repay Debtor-in-Possession financing of
approximately $2.7 million which accumulated while the company
was in bankruptcy. The Company will be reviewing strategic
alternatives including joint venture arrangements, asset sales,
and merger possibilities. With a substantially debt-free balance
sheet, the Company is optimistic that it will be able to realize
substantial value for its new shareholders.


TRI-UNION: Plans Oil & Gas Asset Sales & Terminates Contango Deal
-----------------------------------------------------------------
Tri-Union Development Corporation stated that it is continuing
its efforts to reorganize and successfully exit its Chapter 11
proceeding. The proposed Plan of Reorganization will involve, in
part, the marketing and sale of some or all its oil and gas
properties. The proposed sale is taking place through a data room
organized and managed by Randall & Dewey Inc. The properties to
be sold are located in the Texas Gulf Coast, South Central Texas,
Louisiana, California and Offshore Gulf of Mexico areas. All
offers for the properties are due on Feb. 23, 2001.

Also, Tri-Union and Contango Oil & Gas Company announced the
termination of their letter of intent regarding a proposed
investment by Contango in Tri-Union. The letter of intent was
terminated when the parties could not reach agreement on certain
material terms in the proposed transaction. Tri-Union is
continuing with discussions with other parties interested in
strategic investment in Tri-Union or providing other financing
vehicles in a manner consistent with the Randall & Dewey
marketing process. While Tri-Union will pursue attractive
opportunities for equity infusion, the proposed Plan of
Reorganization to be filed by Tri-Union will not be conditioned
upon an equity investment.

Tri-Union is an independent oil and gas company that focuses on
exploration and development in Texas, Louisiana, California and
the Gulf of Mexico area. At the present time, Tri-Union's
properties consist of proved reserves of approximately 172 Bcfe.
Tri-Union is a debtor in possession in a Chapter 11 bankruptcy
proceeding. Tri-Union believes that the proceeds of the proposed
sale of its properties coupled with its current cash reserves
should be sufficient to obtain successful confirmation of a plan
of reorganization.


VENCOR INC.: Settles SERP Claims With W. Bruce Lunsford
-------------------------------------------------------
The Court approved the Stipulation between Vencor, Inc. and W.
Bruce Lunsford, a significant Ventas shareholder regarding proofs
of claim (Compensation Claim, the Separation Agreement Claim,
Indemnification Claim) filed by Mr. Lunsford.

The parties agreed and stipulated that:

      (A) With respect to the Compensation Claim in the amount of
$3,604,987 (Item I, the Deferred Compensation Claim) and II (the
Supplemental Executive Retirement Plan (SERP) Claim) are allowed
subject to their treatment in accordance with the Plan:

          -- Upon Vencor's assumption of the SERP and the Deferred
             Compensation Plan on the Effective Date, all payments
             owed to Lunsford under each of the SERP and the
             Deferred Compensation Plan willll be made in
             accordance with the terms of the SERP and the
             Deferred Compensation Plan. (The terms SERP, the
             Deferred Compensation Plan and the Effective Date are
             as defined in the Second Amended Plan and the SERP in
             the stipulation includes the amendments dated January
             15, 1999 and December 31, 1999, and any future
             amendments.)

         (i) Lunsford expressly consented to and agreed to abide
             by the SERP Amendments, including, without
             limitation, any future amendment to the SERP,
             including any future amendment eliminating or
             modifying the change in control provision contained
             in section 3.6 of the SERP (the Change In Control
             Amendment); provided that no such future amendment
             (except the Change In Control Amendment) shall defer
             the commencement of payments to Lunsford, or reduce
             the present dollar value of Lunsford's claim under
             the SERP, determined based on the actuarial
             assumptions that the SERP and other provisions of the
             SERP refer to.

        (ii) Lunsford expressly waived any claim under the SERP
             except as provided in the Stipulation and Order, and
             expressly waives any claim in respect of any change
             in control provision under the SERP.

      (B) Lunsford expressly waived any claim under the Separation
Agreement and Release of Claims between Lunsford and Vencor,
Inc., executed on or about January 22, 1999, as set forth in
Lunsford's Separation Agreement Claim in the amount of
$4,543,000.

         (i) Vencor will continue to make payments until the
             Effective Date for Mr. Lunsford's pre-existing
             coverage under the Vencor Health Insurance Plan and
             Dental Insurance Plan, Voluntary Life Insurance
             Benefit Plan, short-term and long-term disability
             insurance benefits, and an office suite and
             administrative assistant, provided by the Separation
             Agreement.

        (ii) In respect of Lunsford's Old Preferred Stock (as
             defined in the Second Amended Plan), Lunsford shall
             have an allowed Put Right (as defined in the Second
             Amended Plan) which will receive the treatment
             provided in paragraph 5.08 of the Plan, under which
             monetary damages in respect of Lunsford's allowed Put
             Right will be canceled in exchange for the
             cancellation of all of Lunsford's obligations arising
             under the Nontransferable Full Recourse Note in the
             original principal amount of $4,088,700 dated April
             30, 1998 (the Lunsford Preferred Equity Interest
             Loan).

      (C) In respect of alleged indemnification obligations of the
Debtors (the Indemnification Claim), Lunsford's unliquidated
claim will be allowed subject to the conditions in the
stipulation and all rights of indemnification, contribution,
and/or other similar relief of Lunsford against the Debtors or
any of them will be preserved, provided, however, that,

         (i) Debtors will use their commercially reasonable
             efforts to continue and maintain Lunsford's present
             rights to insurance coverage under any so-called
             directors' and officers' policy (a D&O Policy), and
             will afford Lunsford the same treatment afforded
             all ex-officers and directors respecting renewal or
             acquisition of insurance coverage; and

        (ii) any and all obligations of the Debtors to provide
             indemnification, contribution and/or other similar
             relief to Lunsford, including, without limitation,
             all obligations in respect of the Indemnification
             Claim, shall be satisfied only through payments made
             or funded under any available present or future D&O
             Policy.

Except for claims or rights allowed or preserved in the
Stipulation and Order, the Lunsford Releasors, release and acquit
forever the Debtors and other Lunsford Releasees from any and all
claims, liabilities, causes of action etc. except allowed claims
and reserved rights set forth in the Stipulation, and provided
that such release will not be deemed to limit Lunsford's rights
to coverage under any insurance maintained by any of the Debtors.
(The Lunsford Releasors refer to Lunsford, and his heirs,
executors, agents, attorneys, administrators, successors and
assigns, and such other persons or entities that may make any
claims derived under or through them; the Lunsfor Releasees refer
to the Debtors, their affiliates, subsidiaries, corporate
parents, and each of their present and former officers,
directors, managing directors, control persons, stockholders,
employees, agents, attorneys, administrators, successors and
assigns.)

The Lunsford Releasors also release, discharge and acquit forever
Ventas in respect of any claims arising under the SERP, the
Deferred Compensation Plan, the Old Preferred Stock, the Put
Right, the Lunsford Preferred Equity Interest Loan, any options
to acquire Old Common Stock, the Lunsford Employment Agreement,
and the Separation Agreement.

However, the Lunsford Releasors reserve all other claims and
rights against Ventas, including claims to indemnification,
contribution and/or other similar relief against Ventas.

The Debtor Releasors release, discharge and acquit forever
Lunsford, and the Debtor Releasees from claims, causes of action,
liabilities, etc. (Vencor Bankruptcy News, Issue No. 24;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


VLASIC FOODS: Gets Okay to Maintain Existing Bank Accounts
----------------------------------------------------------
Vlasic Foods International, Inc. reminded the Court that the
Office of the United States Trustee has established certain
operating guidelines for debtors-in-possession in order to
supervise the administration of chapter 11 cases. These
guidelines require chapter 11 debtors to, among other things:
(a) close all existing bank accounts and open new debtor-in-
possession bank accounts; (b) establish one debtor-in-possession
account for all estate monies required for the payment of taxes,
including payroll taxes; and (c) maintain a separate debtor-in-
possession account for cash collateral.

Joseph Adler, Vlasic's Vice President and Controller, told the
Court that the U.S. Trustee's guidelines won't work in Vlasic's
chapter 11 cases. Vlasic uses 13 bank accounts across the United
States through which the company manages cash receipts,
disbursements and investments for their entire domestic corporate
enterprises. The Debtors routinely deposit, withdraw and
otherwise transfer funds to, from and between such accounts by
various methods including check, wire transfer, automated
clearing house transfer and electronic funds transfer. In
addition, the Debtors generate thousands of accounts payable and
payroll checks per month from the Bank Accounts, along with
approximately 200 wire transfers each month.

The Debtors sought a waiver of the United States Trustees
requirement that the Bank Accounts be closed and that new
postpetition bank accounts be opened. If the Guidelines were
enforced in these cases, these requirements would cause enormous
and unnecessary disruption in the Debtors' businesses and would
significantly impair their efforts to reorganize.

Mr. Adler explained that the Debtors' Bank Accounts are part of a
carefully constructed and highly automated Cash Management System
that ensures the Debtors' ability to efficiently monitor and
control all of their cash receipts and disbursements.
Consequently, closing the existing Bank Accounts and opening new
accounts inevitably would result in delays in payments to
administrative creditors and employees, severely impeding the
Debtors' ability to ensure as smooth a transition into chapter 11
as possible and, in turn, jeopardizing the Debtors' efforts to
successfully confirm a plan in a timely and efficient manner.
Additionally, as a result of the Debtors' diminished staff which
is responsible for the cash management system, requiring the
Debtors to replace their Bank Accounts would impose a daunting
administrative burden. Finally, because the Debtors' disbursement
systems are integrated with their banks to allow for automatic
bank reconciliations, replacing the Bank Accounts would require
systemic changes which would be difficult to implement.

Accordingly, the Debtors requested that their pre-petition Bank
Accounts be deemed to be debtor-in-possession accounts, and that
the Company be permitted to maintain and continue use, in the
same manner and with the same account numbers, styles and
document forms as those employed prepetition, be authorized,
subject to a prohibition against honoring prepetition checks
without specific authorization from this Court.

Recognizing the need for relief from the U.S. Trustee's
Guidelines in multi-hundred-million-dollar chapter 11 cases, and
noting that in other cases of this size, courts have routinely
recognized that the strict enforcement of bank account closing
requirements does not serve the rehabilitative purposes of
chapter 11, Judge Robinson granted the Debtors' Motion in all
respects. (Vlasic Foods Bankruptcy News, Issue No. 2; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


WHOLETREE.COM: Files Chapter 7 Petition in Colorado
---------------------------------------------------
Wholetree.com, Inc., a provider of technology that enables
multilingual and multi-cultural global business transactions over
the Internet, and a wholly-owned subsidiary of LanguageWare.net
Ltd. (OTC Bulletin Board: LWNTF, LWNUF), announced that it has
filed a voluntary petition under Chapter 7 of the U.S. Bankruptcy
Code in the District of Colorado. A Chapter 7 filing involves the
liquidation of the company's assets by a trustee.

Additionally, the board of directors of LanguageWare.net has
authorized the filing of a liquidation application under Israeli
law on the grounds of insolvency. Management expects the
appropriate filings in Israel to be completed by February 15,
2001 to commence the liquidation proceeding. The proceeding under
Israeli law will involve the liquidation of the company's assets
by a trustee.

As previously announced, LanguageWare.net and its U.S. subsidiary
lack sufficient capital to fully meet their financial obligations
to creditors and to remain operating. LanguageWare.net has
exhaustively explored merger and acquisition partners as a source
of capital or to acquire the assets of the company and its
subsidiaries. Despite significant effort, the company has not
been successful in obtaining additional investments or in finding
a buyer for the company or its assets.


BOND PRICING: For the week of February 12 - 16, 2001
----------------------------------------------------
Following are indicated prices for selected issues:

AMC Ent 9 1/2 '09                   75 - 77
Amresco 9 7/8 '05                   50 - 54
Asia Pulp & Paper 11 3/4 '05        34 - 38
Chiquita 9 5/8 '04                  46 - 48
Conseco 9 '06                       88 - 90
Federal Mogul 7 1/2 '04             24 - 26
Globalstar 11 3/8 '04                8 - 9 (f)
Oakwood Homes 7 7/8 '04             42 - 44
Owens Corning 7 1/2 '05             26 - 28 (f)
PSI Net 11 '09                      28 - 30
Pacific Gas 6 1/4 '04               87 - 89
Revlon 8 5/8 '08                    46 - 48
Saks 7 '04                          84 - 86
Sterling Chemical 11 3/4 '06        55 - 57
Teligent 11 1/2 '07                  9 - 10
Tenneco 11 5/8 '09                  45 - 49
TWA 12 '02                          90 - 92 (f)


                           *********
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.bankrupt.com/books/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, 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
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
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herein is obtained from sources believed to be reliable, but is
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                      *** End of Transmission ***