TCR_Public/010223.MBX          T R O U B L E D   C O M P A N Y   R E P O R T E R

             Friday, February 23, 2001, Vol. 5, No. 38

                            Headlines

3DFX INTERACTIVE: Asks Shareholders to Approve Sale to NVIDIA
ARMSTRONG HOLDINGS: Hires Clifford Chance as Securities Counsel
ARMSTRONG: Talking to CVC Capital About Sale of European Unit
ATHEY PRODUCTS: Sold to Federal Signal For $12,301,000
B B WALKER: Reports Decreasing Revenues in 2000

BIRMINGHAM STEEL: Posts Weak Second Quarter Financial Results
BIRMINGHAM STEEL: Amends Financing Agreements With Lenders
BRANDMAKERS: Still Losing Money Despite Improved 2000 Results
CASTLE DENTAL: Hires Getzler & Co. & Discloses Management Changes
COVAD: Caa1 Rating Placed On Review For Possible Downgrade

CREDITRUST: Completes Portfolio Transaction with NCO Group
CROWN RESOURCES: Will Not Make Interest Payment on Debentures
E.SPIRE COMMUNICATIONS: Defaults on $15 Million Interest Payment
FRUIT OF THE LOOM: Rule 9027 Removal Period Extended To Sept. 17
HARNISCHFEGER: Presses Objections to Mitsui's $29.9 Million Claim

HOM CORPORATION: Looks for Funding to Sustain Operations
HOME HEALTH: Has Until May 14 to Decide on Leases
HOME HEALTH: Exclusive Period Extended through March 30
ICG COMM.: Has Until June 12 To Remove Lawsuits to Delaware
IMPERIAL SUGAR: Retains Wasserstein Perella as Financial Advisor

IMPERIAL SUGAR: Selling Nutritional Products Business to Hormel
INNOFONE.COM: Needs More Funds to Continue as a Going Concern
INTEGRATED HEALTH: Hiring & Paying Ordinary Course Professionals
JUMBOSPORTS: Taps Bilzin Sumberg as Committee's Counsel
KCS ENERGY: Plan Declared Effective & Emerges from Bankruptcy

LERNOUT & HAUSPIE: Committee Retains BDO Seidman as Accountants
LOEWEN GROUP: Nine Illinois Debtors Sell Assets For $1,520,000
LTV CORPORATION: Court Okays Tin Mill Business Sale to U.S. Steel
NETOBJECTS: Anticipates More Revenue Shortfalls in the Future
NORTHPOINT COMMUNICATIONS: Wins Final Court Nod On $38MM DIP Loan

OWENS CORNING: Assuming Joint Venture Agreement with Ikomat
PILLOWTEX CORPORATION: Rejects Aircraft Lease With Fleet Bank
PITTSBURGH-CANFIELD: Court Sets May 16 Bar Date for Filing Claims
RK POLYMERS: Moody's Lowers Proposed Senior Credit Facility To B1
SAFETY-KLEEN: Paying Officer and Director Defense Costs

TELIGENT INC.: Moody's Cuts Senior Debt Ratings To Ca From Caa1
TRANS WORLD: Court Denies Continental Bid To Halt Auction Process
TRW INC.: Moody's Cuts Senior Long-Term Debt Rating To Baa2
WHEELING-PITTSBURGH: Ohio Seeks Enforcement of Environmental Laws
WKI HOLDING: Moody's Downgrades Senior Subordinated Notes To Caa1

WORLD OF SCIENCE: Revised List of 20 Largest Unsecured Creditors

BOOK REVIEW: ITT: The Management of Opportunity

                            *********

3DFX INTERACTIVE: Asks Shareholders to Approve Sale to NVIDIA
-------------------------------------------------------------
A special meeting of shareholders of 3dfx Interactive, Inc. is to
be held on Tuesday, March 27, 2001, at 8:00 a.m. local time, at
the Marriott Hotel, 2700 Mission College Boulevard, Santa Clara,
California. At the special meeting, 3dfx will be seeking
stockholder approval of the winding up and dissolution of the
company, as well as approval of the sale of certain of its assets
to NVIDIA US Investment Company, an indirect wholly-owned
subsidiary of NVIDIA Corporation.

Under the terms of the asset purchase agreement, 3dfx will sell
certain of its assets to NVIDIA US Investment Company and will
receive a total consideration of $70 million in cash and
1,000,000 shares of NVIDIA common stock, subject to adjustment.

3dfx began encountering financial difficulties in the fall of
2000 due to a number of factors, including substantially reduced
demand in the retail channels for its products. At that time, the
company re-evaluated its business model and decided that it was
necessary to quickly reposition 3dfx to focus principally on the
development of graphics chips and related technologies, and to
further analyze the possible termination or sale of its graphics
board business. In seeking to implement this strategy, the
company entered into discussions with numerous parties to whom it
sought to sell its graphics board business or from whom it sought
to obtain financing necessary to the continuation of business.

None of these discussions resulted in the execution of any
definitive agreements, and in the meantime the financial
condition of the company has continued to deteriorate.


ARMSTRONG HOLDINGS: Hires Clifford Chance as Securities Counsel
---------------------------------------------------------------
Armstrong Holdings, Inc. applied for authority to employ the law
firm of Clifford, Chance, Rogers & Wells LLP as special corporate
and securities counsel.

The firm will be employed to provide legal advice concerning
certain securities, mergers, antitrust and acquisition-related
and other legal services to these Chapter 11 estates. CCR&W will
also provide day-to-day legal advice, management and supervisory
training concerning corporate, antitrust and securities matters.
In no event will Clifford Chance be employed to provide any
representation of the Debtors with relation to the prosecution of
these Chapter 11 cases, including the negotiation, proposal and
prosecution of any plan of reorganization.

Dennis J. Drebsky, on behalf of the firm, has averred that the
firm is disinterested within the meaning of the Bankruptcy Code
and neither holds nor represents any interest adverse to these
estates on the matters for which employment is sought.

The Debtors have employed Clifford Chance as their counsel to
handle certain securities, acquisitions and mergers, and
antitrust matters for approximately five years. Within one year
prior to the commencement of these Chapter 11 cases, the Debtors
paid CCR&W approximately $251,000 for services rendered and
expenses incurred, and have accumulated approximately $9,200 in
fees and expenses unbilled prior to the Petition Date. (Armstrong
Bankruptcy News, Issue No. 4; Bankruptcy Creditors' Service,
Inc., 609/392-0900)


ARMSTRONG: Talking to CVC Capital About Sale of European Unit
-------------------------------------------------------------
Armstrong DLW AG, a subsidiary of U.S.-based Armstrong Holdings,
Inc. (NYSE: ACK) said that it had entered into talks with CVC
Capital Partners on the possible sale of the European components
of its Textiles and Sports Flooring division, which operates
under the brand name Desso. The talks are expected to last
several months.

Desso, with approximately 1,300 employees, manufactures
commercial carpet and artificial sports flooring in The
Netherlands, Germany and Belgium. Based in Oss, The Netherlands,
the division had annual sales of approximately $313 million in
1999.

"An acquisition by CVC would enable Desso to receive the
investment it needs to grow and better serve its customers and
employees," said Armstrong DLW AG President and CEO Gerard Glenn.
"Armstrong's European flooring business is focused on resilient
products, and indeed we would use the proceeds from a sale to
grow this core business for us in Europe."

Although the Company is currently assessing the accounting for
the potential transaction, it is expected that there could be a
net loss on disposal of approximately $30-35 million before any
tax benefit. CVC Capital Partners, based in London, is a leading
European private equity firm that has interests in more than 200
companies throughout Europe with a total value of $30 billion.

Additionally, Armstrong Holdings, whose operating unit, Armstrong
World Industries, Inc., filed for Chapter 11 protection in
December to resolve its asbestos liability, reported that it
would disclose its financial results for 2000 in its 10-K report
to the SEC in late March. Although the financial reports are not
yet available, Chairman and CEO Michael D. Lockhart said that
fourth quarter 2000 performance was negatively impacted by a
decline in sales and profits as a result of the continued
slowdown in the economy, and higher raw material and energy
costs. For 2001, Lockhart said he expected economic conditions
not to improve and that Armstrong plans on revenues relatively
flat versus 2000 and operating income, excluding the effects of
asbestos and reorganization charges, to decline from 2000 levels.


ATHEY PRODUCTS: Sold to Federal Signal For $12,301,000
------------------------------------------------------
Athey Products Corporation (OTC Bulletin Board: ATPCQ), a
manufacturer of street sweeping and material handling equipment,
filed a voluntary petition for relief pursuant to Chapter 11 of
the Bankruptcy Code with the U.S. Bankruptcy Court for the
Eastern District, Raleigh Division, on December 8, 2000. On
February 20, 2001, upon motion of Athey and pursuant to a
previously approved overbid process, the Court approved the sale
to Five Star Manufacturing, LLC, a wholly owned subsidiary of
Federal Signal Corporation (NYSE: FSS), of substantially all of
the Company's assets for $12,301,000 in cash (subject to
contractual adjustments as applicable) and the assumption by Five
Star of certain obligations including existing sale agreements to
its customers, warranties, dealer agreements and various unfilled
purchase agreements with vendors.

An overbid fee of $200,000 is also to be paid to Alamo Group (NC)
Inc. as the unsuccessful initial bidder and as had been agreed
previously with the Company.

A final closing for the sale was set for March 5, 2001. In
addition, the Court approved the rejection of certain contracts
involving the sale of real estate and the employment of officers,
and denied the motion to reject the collective bargaining
agreement which expires by its terms on April 20, 2001.


B B WALKER: Reports Decreasing Revenues in 2000
-----------------------------------------------
The B B Walker Company manufactures and distributes high quality,
moderately-priced branded and private label footwear. The
company's product offerings to its customers consist principally
of either western boots or work/outdoor boots. It also
manufactures safety shoes with steel toe construction.

Net sales for fiscal 2000 were $22,156,000 compared to
$25,896,000 for the same period in 1999 or 14.4% decrease from
the prior year. The net loss for the year was $1,771,000 compared
to a net loss in 1999 of $592,000.

Revenues for 2000 decreased $3,740,000 (or 14.4%) from 1999. Work
branded shipments were down $1,607,000 (or 18.3%), and western
branded sales decreased $1,667,000 (or 12.1%). This deterioration
in revenues was due primarily to a continuation of the current
import penetration of over 95% of the U.S. footwear market, which
has made it easier for other companies to enter the footwear
market. This has resulted in a proliferation of brands full of
low-priced imports adversely affecting business. Due to this
increased competition, the company indicates it has taken the
following actions to preserve its position in the industry.

First, the company has decreased its workforce in fiscal 2000 by
another 13% compared to a 11% cutback during the prior year.
Second, following the limited success in selling footwear
manufactured in Mexico during fiscal 2000, the company will be
introducing work shoes and western footwear manufactured in Spain
and China, respectively, in early calendar 2001 to be more price
competitive.

The combined sales of the company's two retail outlets declined
$295,000 (or 13.5%) due to increased competition from major
discount retailers surrounding the retail outlets.

In spite of 2000's 14.4% decrease in net sales, the gross margin
as a percentage of sales decreased only 1.4% (from 28.1% in 1999
to 26.7% in 2000). This slight decrease indicates that variable
manufacturing expenses were effectively controlled during the
year. However, the losses from operations increased from $591,000
in 1999 to $1,449,000 in 2000, as declining revenues did not
satisfactorily cover the company's fixed manufacturing,
administrative, and debt service costs.


BIRMINGHAM STEEL: Posts Weak Second Quarter Financial Results
-------------------------------------------------------------
Birmingham Steel Corporation (NYSE:BIR) reported financial
results for the second quarter and six months ended December 31,
2000. The results for the current and comparable prior fiscal
year periods have been modified to present the Company's special
bar quality (SBQ) operations as discontinued operations. Results
for the Company's core operations are presented as continuing
operations.

The second quarter operating results reflect a continuing
economic downturn in the U.S. steel industry, as evidenced by
lower selling prices, reduced shipments, higher energy costs and
higher manufacturing costs associated with reduced production
levels. The results also reflect the impact of a decrease in
construction activity related to severe winter weather across the
U.S. However, compared with the same periods of the prior fiscal
year, the Company's core operations reported overall improved
financial results. Results for the second quarter and first six
months of fiscal 2001 reflect reductions in selling, general and
administrative expenses, start-up costs and other unusual
expenses.

For the three months ended December 31, 2000, the Company
reported a net loss from continuing operations of $17.3 million
($0.56 per share), compared with a loss of $41.7 million ($1.41
per share) in the same quarter of the prior fiscal year. Results
in the current year quarter reflect reductions of $3.8 million in
selling, general and administrative expenses associated with
aggressive cost reduction measures implemented during the past
year. The results for the prior-year quarter reflected $28.5
million of start-up and restructuring costs, as well as unusual
expenses related to the proxy contest which ended on December 2,
1999.

Steel shipments in the second quarter of fiscal 2001 were 562,000
tons, down from 607,000 tons in the same period last year.
Reflecting a general trend of declining industry selling prices,
the weighted average selling price per ton for shipments from the
core operations in the current year's quarter was $267, compared
with $279 last year.

For the six months ended December 31, 2000, the Company reported
a net loss from continuing operations of $24.1 million, compared
with a loss of $35.9 million for the same period of fiscal 2000.
The results reflect reductions of $4.6 million in selling,
general and administrative expenses. The results for the prior-
year period included $33.6 million of start-up and restructuring
costs and other unusual expenses associated with the proxy
contest. On a per share basis, the loss in the current six-month
period was $0.78, compared with $1.21 in the same period of the
prior year.

Steel shipments for the six months ended December 31, 2000, were
1,215,000 tons, down from 1,249,000 tons in the same period of
the prior year. The weighted average selling price per ton for
the Company's core operations was $271 in the current-year
period, compared with $279 in the first six months of fiscal
2000.

John D. Correnti, Chairman and Chief Executive Officer of
Birmingham Steel, commented, "Economic conditions in the domestic
steel industry today are the worst in 25 years. Steel producers
are under pressure from all directions. Selling prices have
dropped because of increased imports and high inventories, and
rising energy costs have had an adverse impact on margins. Also,
severe winter weather conditions restricted shipments during the
second quarter. The decline in shipments has forced producers to
curtail production in order to control inventories. As a result,
margins have been compressed by lower selling prices and higher
production costs."

Correnti continued, "During the past 12 months, Birmingham Steel
has significantly reduced SG&A, start-up and unusual costs.
Unfortunately, our progress has been overshadowed by the
deterioration in industry pricing and demand, which have
continued into the March 2001 quarter. Although we expect
difficult business conditions for the remainder of calendar 2001,
we believe the worst may be over."

Correnti stated, "We recently implemented a price increase of $20
per ton for rebar, which should begin to have a positive impact
on results in the month of March. We also announced an increase
of $20 per ton for merchant products. Although it is too soon to
determine whether the merchant price increase will hold, at this
time we do not foresee any further price decline. Although there
are signs the overall U.S. economy is slowing, shipments for both
rebar and merchant products should improve as we enter the
seasonally strong construction period."

Based upon the Company's decision to divest its special bar
quality (SBQ) facilities in Cleveland, Ohio, and Memphis,
Tennessee, and as required by generally accepted accounting
principles ("GAAP"), the Company's SBQ operations are now
presented as discontinued operations. For the quarter ended
December 31, 2000, the SBQ facilities generated a loss from
operations of $12.0 million. In accordance with GAAP, the second
quarter results also reflect charges of $89.9 million associated
with the pending sale of the SBQ facilities, including estimates
for loss on sale of the facilities and operating losses to be
incurred until disposal.

Commenting on the pending sale of the Company's SBQ facilities to
North American Metals, Ltd., Correnti said, "As we stated in a
press release dated January 31, 2001, the Hart-Scott-Rodino
filings necessary to complete the transaction have been approved
by the appropriate regulatory authorities, and NAM continues to
report progress in its efforts to complete the purchase. We are
hopeful that financing commitments from NAM's lenders will be in
place soon. Based upon the status of NAM's current progress, we
have targeted March 23, 2001, as the date for closing of the
transaction."

Correnti noted that, upon sale of the SBQ operations, Birmingham
Steel expects to reduce its debt and interest expense by
approximately 30%. In addition, the transaction will enable the
Company to relinquish an off-balance sheet leveraged lease
obligation associated with the Memphis facility. The transaction
is subject to the approval of Birmingham Steel's lenders.

Correnti said, "Without question, the U.S. steel industry is in a
recession, and we expect industry margins will remain under
pressure for the balance of 2001. For Birmingham Steel, our
challenges will be complicated by our high debt level. However,
we have an excellent workforce and management team, and we will
continue to aggressively pursue our plans to improve Birmingham
Steel's financial position. We will endeavor to respond to a very
difficult industry environment in a manner that will build value
for our shareholders."

Birmingham Steel operates in the mini-mill sector of the steel
industry and conducts operations at facilities located across the
United States. The common stock of Birmingham Steel is traded on
the New York Stock Exchange under the symbol "BIR."


BIRMINGHAM STEEL: Amends Financing Agreements With Lenders
----------------------------------------------------------
Birmingham Steel Corporation disclosed that it has amended its
long-term debt agreements with its lenders to provide
modifications to financial covenants and extend maturity dates
for principal payments that were previously due before March 31,
2002.  The new agreements maintain the interest rates or spreads
currently in effect for the Company's debt. The amendments also
limit the borrowings under its revolver and other credit
facilities to an aggregate of $300 million.  In consideration for
the financing agreement modifications, and in lieu of cash fees,
the exercise price for the common stock warrants held by the
Company's lenders has been reduced from $3.00 to $0.01 per share.

Birmingham Steel Corporation is party to bank loan agreements
under which Bank of America, N.A., as successor to NationsBank
N.A. (South), serves as Agent.  In addition to amending its bank
loan agreements on February 20, 2001, the Company also entered
into (i) a Third Amendment to Note Purchase  Agreement dated
February 20, 2001 re: Amended and Restated Note Purchase
Agreements  dated as of October 12, 1999 and $130 million Senior
Notes; (ii) a Third Amendment to Note Purchase Agreement dated
February 20, 2001 re: Amended and Restated Note Purchase
Agreements  dated as of October 12, 1999 and $150 million Senior
Notes; (iii) a Fifth Amendment to Reimbursement agreement, dated
February 20, 2001 between Birmingham Steel Corporation and PNC
Bank, Kentucky, Inc.; (iv) Amendment No. 1 to Warrant Agreement
dated February 20, 2001, between Registrant and the warrant
holders parties thereto; (v) Eighth Amendment to Credit Agreement
dated February 20, 2001 by and among Birmingham Steel
Corporation, the Borrower, the financial institutions party
thereto, and Bank of America, N.A. successor to NationsBank N.A.
(South), as Agent; (vi) a First Amendment to Credit  Agreement
dated February 20, 2001,  between Birmingham  Southeast,  LLC,
the Borrower,  the financial  institutions party thereto, as
lenders, and Bank of America, N.A., as agent; and (vii) a Letter
agreement dated February 20, 2001 between the Company and the
Memphis Leaseholders.  The Company said in its quarterly report
filed with the SEC this week that copies of these documents are
"to be filed by amendment" at some future date.

John D. Correnti, Chairman and Chief Executive Officer of
Birmingham Steel commented, "Because of the decline in overall
market conditions, we needed to amend certain financial covenants
contained in our financing agreements and extend the dates for
principal payments due within the next year. We are pleased that
our lenders continue to support management's efforts to return
the Company to profitability. We believe the amended financing
agreements will provide the Company with adequate financial
resources until we can refinance or restructure our debt on more
favorable terms. Although steel industry and general economic
conditions will influence the timing of our efforts, we expect to
refinance or restructure our debt within the next 12 months."

Correnti concluded, "Without question, the U.S. steel industry is
in a recession, and we expect industry margins will remain under
pressure for the balance of 2001. For Birmingham Steel, our
challenges will be complicated by our high debt level. However,
we have an excellent workforce and management team, and we will
continue to aggressively pursue our plans to improve Birmingham
Steel's financial position. We will endeavor to respond to a very
difficult industry environment in a manner that will build value
for our shareholders."

Birmingham Steel operates in the mini-mill sector of the steel
industry and conducts operations at facilities located across the
United States. The common stock of Birmingham Steel is traded on
the New York Stock Exchange under the symbol "BIR."


BRANDMAKERS: Still Losing Money Despite Improved 2000 Results
-------------------------------------------------------------
BrandMakers Inc.'s revenue increased 263% from $362,331 to
$953,335 for the three months ended December 31, 2000 compared to
December 31, 1999. The increase in revenues was primarily
achieved by the ZOOM Communications Division. The company had a
net loss of $144,084 for the period ended in 1999. However, due
to discontinued operations of K.W. Machines, goodwill in the
amount of $563,360 was written off increasing the total loss for
the three months ending December 31, 2000 to $635,506.

For the six-month period ended December 31, 2000 revenue
increased 284% from $733,937 to $2,087,110 compared to December
31, 1999. The company had a net loss of $205,237 for the period
ended in 1999 and a net loss of $1,232,938 in 2000 due to
increased operating expenses and a loss of $682,679 from the
discontinued operations of K.W. Machines.

The company has and continues to suffer from significant losses
and has a negative working capital. These factors raise
substantial doubt about the company's ability to continue as a
going concern.


CASTLE DENTAL: Hires Getzler & Co. & Discloses Management Changes
-----------------------------------------------------------------
Castle Dental Centers (Nasdaq: CASL), retained Getzler and Co., a
New York based turnaround specialist, to assist the Company in
addressing its operational issues and restructuring of the
Company's debt.

The Company's board of directors has appointed Getzler's
designee, Ira Glazer, to serve as the Company's acting Chief
Executive Officer. The Company is engaged in an executive search
for a permanent Chief Executive Officer. Jack Castle, Jr., the
Company's former Chief Executive Officer, will continue to serve
as the Company's Chairman of the Board.

The Company also announced that its President, Chief Operating
Officer, G. Daniel Siewert, III has resigned to pursue other
opportunities. These changes are part of the Company's plan to
enhance operating performance in 2001.

Castle Dental Centers, Inc. develops, manages and operates
integrated dental networks through contractual affiliations with
general, orthodontic and multi-specialty dental practices in the
U.S. The Company manages 100 dental centers with approximately
235 affiliated dentists in Texas, Florida, Tennessee and
California.


COVAD: Caa1 Rating Placed On Review For Possible Downgrade
----------------------------------------------------------
Moody's Investors Service placed Covad Communications Inc.'s
senior unsecured notes rated Caa1 on review for possible
downgrade. These are as follows:

      * $425 million 12% Senior Notes due 2010

      * $215 million 12.5% Senior Notes due 2009

      * $138 million Senior Discount Notes due 2008

      * $500 million Conv. Senior Notes due 2005


According to Moody's, this action follows Covad's recent
statement that it will delay the announcement of its year-end
operating results pending a further review of revenue recognition
procedures, restructuring charges, and the impact of adopting new
accounting procedures.

Moody's relates that Covad incurred a restructuring charge of
between $50 - $100 million, up from an earlier estimate of
approximately $20 million, an increase in the number of central
office closings to 260 from 200, a potential impairment in the
value of its investment in BlueStar Communications Inc., and a
reduction in full year 2000 revenue and EBITDA related to the
adoption of accounting procedure SAB-101of approximately $52
million and $17 million, respectively. Management is also said to
continue its review of internal procedures and controls regarding
the recognition of customer revenues.

On December 13, 2000, Moody's lowered the ratings of Covad and
changed the outlook to negative. The rating action agency stated
that the review will assess the degree to which the issues raised
in the company's recent statement will represent a further
deterioration of the company's operating and financial condition.

California-based Covad is a national broadband service provider
of high-speed Internet and network access utilizing Digital
Subscriber Line (DSL) technology.


CREDITRUST: Completes Portfolio Transaction with NCO Group
----------------------------------------------------------
NCO Group, Inc. (Nasdaq: NCOG), the world's largest provider of
accounts receivable collection services, and Creditrust
Corporation (OTC Bulletin Board: CRDT), an information-based
purchaser of delinquent Visa(R) and MasterCard(R) debt, announced
the completion of the previously announced merger between NCOG's
wholly owned subsidiary NCO Portfolio Funding Inc (NCOPF) and
CRDT. The newly combined entity will be called NCO Portfolio
Management Inc (OTC Bulletin Board: NCOP). Approximately 63% of
NCOP will be owned by NCOG and legacy shareholders of CRDT will
own approximately 11%. The remainder of NCOP will be owned by
certain former creditors and other stockholders as described
below. The merger is in conjunction with CRDT's plan of
reorganization, which was approved by the United States
Bankruptcy Court on January 18, 2001. Under the plan of
reorganization, all creditors of CRDT will be paid in full, in
cash, including accrued interest.

Highlights of the NCOP transaction are as follows:

      -- NCOP will focus on the purchase and management of
         delinquent accounts receivable portfolios.

      -- Each holder of record of a share of CRDT common stock on
         February 20, 2001 will initially receive 0.1388 shares of
         NCOP common stock, and will be eligible to receive up to
         an additional 0.0279 shares, currently held in escrow,
         based on the resolution of certain disputed claims. This
         equates to an equivalent market price of up to $4.50 per
         share, based on the closing bid price of CRDT yesterday
         of $0.75 per share.

      -- NCOP has approximately 13.6 million shares of stock
         outstanding.

      -- NCOP shares will initially trade on the Over the Counter
         ("OTC") market.  After approximately three weeks the
         stock is expected to transition to Nasdaq National
         Markets. Five brokers have indicated that they intend to
         make a market in NCOP's stock. Several of NCOG's research
         analysts intend to initiate coverage on NCOP shortly
         after the stock is listed on the Nasdaq. NCOP will be one
         of the largest publicly traded companies dedicated to the
         purchase of delinquent consumer debt.

      -- Michael J. Barrist, Chairman and CEO of NCOP, has
         purchased $2.0 million of common stock from NCOP at a
         price of $5.11 per share.

      -- Joseph K. Rensin, outgoing Chairman and CEO of CRDT, has
         purchased $1.0 million of common stock from NCOP at a
         price of $5.11 per share.

      -- NCOP will have a five-member board of which four
         directors will be independent. Two of the independent
         directors have been appointed by NCOG, one by a group of
         CRDT bondholders, and one by the CRDT legacy
         shareholders.

      -- NCOP entered into a ten-year exclusive agreement with
         NCOG whereby NCOG will refer all debt purchase
         opportunities in the United States to NCOP and NCOG will
         be the exclusive servicer of all NCOP portfolios.
         Additionally, NCOG purchased from NCOP all of the call
         center assets previously owned by CRDT, and employed a
         majority of the legacy CRDT call center employees.

      -- Joseph K. Rensin, CRDT's Chairman and CEO, has entered
         into a 3 year consulting agreement with NCOP whereby he
         will be available to assist with any transition related
         issues.

      -- Under an agreement with NCOG's lender group, NCOG has
         established a $50.0 million credit facility for the
         exclusive use of NCOP.

"We are very pleased with the way this transaction has worked
out," stated Joseph K. Rensin, outgoing Chairman and CEO of CRDT,
"Creditrust has a long history as an industry pioneer, and we are
confident that the synergies with NCO Group will only add value
for our shareholders and our employees."

"We are extremely excited about completing this transaction,"
stated Michael J Barrist, Chairman and CEO of NCOG, "NCO
Portfolio Management will be able to leverage the client
relationships and scale of the NCO Group infrastructure as well
as the portfolios, historical data and highly skilled workforce
of both Creditrust and NCO Group. We believe that NCO Portfolio
will be the premier player in the purchased debt marketplace and
will achieve the 'best in class' brand recognition that NCO Group
has already achieved in the accounts receivable marketplace."

NCOP Investor Guidance:

The bankruptcy process provides investors and analysts with a
voluminous amount of data, provided in a format to facilitate the
successful reorganization of a business in the bankruptcy
process. Accordingly, the following summary information is
provided by NCOP to facilitate financial modeling for the
investment community.

Initial Capitalization and Financing

NCOP is expected to have an initial net book value of
approximately $43.0 million consisting primarily of previously
purchased portfolios of delinquent accounts receivable
contributed by NCOPF and CRDT, as well as the proceeds from the
aforementioned sale of common stock. In addition to the ongoing
cash flow generated by the contributed portfolios, NCOP projects
that it will require approximately $50.0 million of financing,
with the initial use of funds as follows:

      Repayment of pre-existing warehouse facility    $13,200,000
      Repayment of pre-bankruptcy claims               18,600,000
      Estimated initial financing costs                 1,000,000
      Repayment of portfolios purchased by NCOG
        in excess of $25.0 million                      5,700,000
      Proceeds from sale of common stock               (2,300,000)
                                                      $36,200,000

The remaining $13.8 million in conjunction with the ongoing cash
flow from the existing portfolios will be used to purchase
approximately $4.5 million per month of new accounts receivable
portfolios during 2001.

Under an agreement with its senior lender, NCOG has established a
$50.0 million sub-limit within its existing $350.0 million credit
facility. This will enable NCOG to establish a $50.0 million
credit facility for NCOP's exclusive use. This credit facility
may be refinanced at a later date.

NCOG will charge NCOP 200 basis points over the rate NCOG is
charged by its senior lender. To the extent that NCOG borrows
funds under its credit facility to lend to NCOP, NCOG will pay
its lender an additional 100 basis points.


CROWN RESOURCES: Will Not Make Interest Payment on Debentures
-------------------------------------------------------------
Crown Resources Corporation said that it will not make its next
to last semi-annual interest payment on the US$15 million 5.75%
Convertible Subordinated Debentures while it seeks additional
financing.

The next interest payment of $431,250 is due February 27, 2001.
The Company will be in default under the terms of the Debentures
if Crown is unable to make the interest payment by March 29,
2001.The last interest payment and principal is due August 27,
2001.

Crown is seeking outside secured financing to make this interest
payment, facilitate debenture restructuring, and maintain and
enhance the assets of the Company for all its stakeholders. There
can be no assurance that Crown will be able to secure this
financing.

Christopher E. Herald, President and Chief Executive Officer of
Crown, stated: "After careful consideration of the options
available to the Company at this time, the Board of Directors
decided that this is the best course of action. We believe that
restructuring the Debentures is necessary to achieve full
valuations for all Crown stakeholders. We look forward to
advancing these discussions with all the Debenture holders."

Crown is a U.S. domiciled gold exploration company with
propertiesin the U.S. Crown is traded on the OTC Bulletin Board
under the trading symbol CRRS and the Toronto Stock Exchange
under the symbol CRO.


E.SPIRE COMMUNICATIONS: Defaults on $15 Million Interest Payment
----------------------------------------------------------------
E.spire Communications Inc., a Herndon, Va.-based
telecommunications firm, announced its default on a $15 million
interest payment due Tuesday after it failed to renegotiate the
terms of its debt with bondholders, according to the Washington
Post.

Negotiations are continuing, and "we are cautiously optimistic
that we will close on a new credit facility soon," said Brad
Sparks, chief financial officer of E.spire. E.spire also
announced that it achieved $500,000 in earnings-before interest,
taxes, depreciation and amortization-during its fourth quarter
that ended Dec. 31. That compares to a loss, excluding those
expenses, of $33.7 million over the same period a year ago. The
company's revenues were $93.9 million during the quarter, up from
$57.5 million the year before. (ABI World, February 21, 2001)


FRUIT OF THE LOOM: Rule 9027 Removal Period Extended To Sept. 17
----------------------------------------------------------------
Judge Walsh ruled that the date to remove actions under Rule 9027
is extended through and including (a) September 17, 2001 or (b)
30 days after entry of an order terminating the automatic stay
with respect to a particular action sought to be removed. (Fruit
of the Loom Bankruptcy News, Issue No. 22; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


HARNISCHFEGER: Presses Objections to Mitsui's $29.9 Million Claim
-----------------------------------------------------------------
Harnischfeger Industries, Inc. has filed with the Court a motion
for summary judgment, pursuant to Federal Rule of Civil Procedure
56 made applicable to the proceeding by Bankruptcy Rules 9014 and
7056, as to P&H's objection to the proof of claim (No. 7292) in
the amount of $29,996,168 plus an undetermined amount, filed by
Mitsui & Co. (U.S.A.), Inc.

The motion for summary judgment is made on the grounds that:

      (1) Mitsui has suffered no damages;

      (2) If Mitsui could somehow establish that it had suffered
          damages, any claims for damages are barred by provisions
          in the Draglines Contract and Draglines Warranty that
          specifically preclude any damages for lost profits, loss
          of use or for incidental or consequential damages of any
          kind, or expense;

      (3) A February 2000 Settlement Agreement, that was executed
          by Mitsui, OCP and P&H, settled the then existing
          disputes regarding the Draglines.

The Debtors attached with the motion excerpts of deposition by
Atsuro Ban (Mitsui's 30(b)(6) designee with respect to damages
issues and the General Manager of Mitsui's Plant & Energy Project
Development Department), the Declaration of Dominique Brown-
Berset (attorney at Froriep Renggli, the Debtors' special foreign
counsel retained for expertise regarding Swiss law) and other
documentary evidence.

As legal standard, the Debtors argued that Rule 56(c) of the
Federal Rules of Civil Procedure, incorporated in Bankruptcy Rule
7056, mandates judgment for the moving party if the "pleadings,
depositions, answers to interrogatories, and admissions on file,
together with the affidavits, if any, show that there is no
genuine issue of material fact, and the moving party is entitled
to judgment as a matter of law." "The moving party bears the
initial burden of demonstrating the absence of genuine issues of
material fact," the Debtors add, citing Bey v. Pennsylvania Dep't
of Corrections, 98 F.Supp.2d.650, 655 (E.D. Pa. 2000). An issue
is "genuine" only if there is a sufficient evidentiary basis on
which a reasonable trier of fact could find for the non-moving
party, and a factual dispute is "material" only if it might
affect the outcome of the suit under applicble law, the Debtors
go on.

The Debtors argued that once the moving party has demonstrated
the absence of genuine issues of material fact, the non-moving
party cannot rest on its pleadings but must "make a showing
sufficient to establish the existence of every element essential
to his case, based on the affidavits or the depositions and
admissions on file." "Speculation, conclusory allegations, and
mere denials are insufficient to raise genuine issues of material
fact." Bey, 98 F.Supp.2d at 656. If the moving party fails to
make a sufficient showing on an essential element of his case
with respect to which he has the burden of proof, the moving
party is entitled to judgment as a matter of law, the Debtors
assert, drawing the Court's attention to Celotex, 477 U.S. at
322.

In the present case, Mitsui cannot carry its burden, the Debtors
note. Accordingly, P&H requested that the Court grant them their
motion for summary judgment. (Harnischfeger Bankruptcy News,
Issue No. 37; Bankruptcy Creditors' Service, Inc., 609/392-0900)


HOM CORPORATION: Looks for Funding to Sustain Operations
--------------------------------------------------------
HOM Corporation, a Georgia corporation incorporated May 4, 2000,
is a holding company. HOM has two operating wholly-owned
subsidiaries, Homes By Owners, Inc., a Georgia corporation
incorporated December 6, 1999, and Direct Lending, Inc., a
Georgia corporation incorporated January 9, 1997 and formerly
named Southern States Lenders, Inc. Homes publishes and
distributes a monthly magazine, HOMES BY OWNERS, listing
residential properties in the Augusta, Georgia/Aiken, South
Carolina metropolitan area for sale by their owners. These
listings are also carried on Homes' website. Direct is a licensed
mortgage broker working with various financial institutions and
underwriters.

To become profitable the current operations of Homes need
resources that currently are not available. Although the company
is seeking such resources, it may be unsuccessful. To give Homes
added substance, Robert S. Wilson, the company's chairman, is
investing $25,000, and Bryce N. Batzer, the other director, has
invested an additional $25,000, in each case for 100,000 shares
of HOM common stock, to establish a $50,000 trading account for
Homes that Mr. Wilson will direct in an attempt to produce funds
for Homes and the rest of the company. Although Mr. Wilson has
been in the securities business and traded securities for many
years, no assurance can be given that such trading will be
successful or that the amounts placed in the trading account will
not be lost in full or substantial part. However, some of the
funds invested in the company by Mr. Wilson during the year 2000
were produced from his profitable trading, and he plans to give
the same attention to the Homes' trading account that he gives
his personal account.

Homes must attract more listings and other advertising if HOMES
BY OWNERS is to become profitable. Currently, the company lacks
the resources to expand the operations of Homes and its magazine,
HOMES BY OWNERS, sufficiently to enable its operation to become
profitable, much less engage in franchises or joint ventures. As
a result, it is considering a sale of the magazine or,
preferably, a joint venture that would involve the funding of
HOMES BY OWNERS until its operation becomes profitable. Although
the company is currently in discussions with various persons
concerning a sale or joint venturing of HOMES BY OWNERS and its
related website, there can be no assurance that such discussions
will be successful or that the company will realize any net
return from HOMES BY OWNERS or its website.

Revenues for the fiscal year ended September 30, 2000 decreased
$17,483 from $78,808 in fiscal year 1999, to $61,325, or 22.2%,
primarily as a result of a substantial decrease in the number of
mortgage financings closed. The decrease of $43,647 of mortgage
revenues was partially offset by revenues of $26,164 from the
magazine, HOMES BY OWNERS, and its associated website.
Net loss for the same period was ($394,039) in fiscal 2000 as
compared with net loss of ($87,592) in fiscal 1999.


HOME HEALTH: Has Until May 14 to Decide on Leases
-------------------------------------------------
By order of the U.S. Bankruptcy Court, District of Delaware,
entered on January 31, 2001, the time within which the debtors,
Home Health Corporation  fo aMerica, Inc., et al. may assume or
reject their unexpired leases is  extended for an additional 90
days or until May 14, 2001, subject to the rights of landlords to
object and seek a reduction of the time period.


HOME HEALTH: Exclusive Period Extended through March 30
-------------------------------------------------------
By order of the U.S. Bankruptcy Court, District of Delaware,
entered on January 31, 2001, Home Health Corporation of America,
Inc. et al. is granted a further extension of time during which
they have the exclusive right to file a plan or plans of
reorganization through March 30, 2001; and the debtors are
granted an extension of time to solicit acceptances of their plan
or plans of reorganization through May 29, 2001, during which
period no one else may file a plan of reorganization.


ICG COMM.: Has Until June 12 To Remove Lawsuits to Delaware
-----------------------------------------------------------
ICG Communications, Inc. and its subsidiary Debtors requested
that Judge Walsh extend the time period during which the Debtors
may remove pending litigation and administrative actions to the
federal district or bankruptcy courts by an additional 120 days,
or to the later to occur of (i) June 12, 2001, or (ii) 30 days
after entry of an order terminating the automatic stay with
respect to any particular action sought to be removed.

The Debtors are parties to numerous judicial and administrative
proceedings currently pending in various courts and
administrative agencies throughout the United States. Because the
Debtors have been primarily focused on stabilizing their
businesses and completing their extensive schedules of assets,
liabilities, and executory contracts and their statements of
financial affairs.

With no objection being interposed by any party-in-interest,
Judge Walsh entered an order extending the deadline as requested.
(ICG Communications Bankruptcy News, Issue No. 4; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


IMPERIAL SUGAR: Retains Wasserstein Perella as Financial Advisor
----------------------------------------------------------------
Imperial Sugar Company applied to Judge Robinson for authority to
employ and retain Wasserstein Perella & Co., Inc., as financial
advisors to the Debtors in these Chapter 11 proceedings.

The Debtors hired Wasserstein in June 2000, well in advance of
the commencement of the bankruptcy proceedings, to review the
Company's strategic position and capital structure and to explore
various recapitalization and restructuring alternatives.
Wasserstein also prepared various financial analyses of the
Debtors' business and made several presentations to the Debtors'
Board of Directors detailing and evaluating recapitalization and
restructuring alternatives.

The Debtors desire to retain Wasserstein to act as their
financial advisors to assist the Debtors in the analysis and
consideration of one or more of these possible transactions:

      (a) Recapitalization or Restructuring which may include any
exchange, conversion, cancellation, forgiveness, retirement
and/or a material modification or amendment to the terms,
conditions or covenants thereof, of the company's equity and/or
debt securities and/or other indebtedness, obligations or
liabilities;

      (b) Public or private issuance, sale or placement of their
equity or debt securities, instruments or obligations with one or
more lenders and/or investors, or any loan or other financing,
excluding any "debtor-in-possession financing" or "exit
financing" or a rights offering effectuated in connection with
the consummation of a confirmed Plan of Reorganization; and

      (c) Disposition to one or more third parties in one or a
series of related transactions of a:

          (i) Significant portion of the Imperial equity
              securities by the security holders; or

         (ii) Significant portion of Imperial's assets including
              the assignment of any executory contracts or
              businesses or its subsidiaries, in either case,
              including through a sale or exchange of
              capital stock, options or assets, a lease of assets
              with or without a purchase option, a merger,
              consolidation or other business combination, an
              exchange or tender offer, a recapitalization, the
              formation of a joint venture, partnership or similar
              entity or any similar transaction.

The Engagement Letter sets forth the following financial advisory
services to be rendered by Wasserstein to the Debtors:

      (a) To the extent necessary, appropriate and feasible, to
continue to familiarize itself with the business, operations,
properties, financial condition and prospects of the Debtors;

      (b) Advise and assist the Debtors in restructuring and
effecting the financial aspects of a restructuring, financing
and/or sale;

      (c) Provide financial advice and assistance in developing
and obtaining approval of a Restructuring Plan;

      (d) Provide financial advice and assistance in structuring
new securities to be issued under the Plan, if requested by the
Debtors;

      (e) Assist and/or participate in negotiations with entities
or groups affected by the Plan, if requested by the Debtors;

      (f) Participate in hearings before the Court with respect to
the matters upon which it has provided advice, including
providing relevant testimony in connection to such advice;

      (g) If the Debtors pursue Financing, to provide financial
advice and assistance regarding structuring and effecting a
financing, identifying potential investors and, at the Debtors'
request, contacting such investors;

      (h) If Wasserstein and the Debtors deem it advisable,
provide assistance in the development and preparation of a
memorandum to be used in soliciting potential investors;

      (i) Assist and/or participate in negotiations with potential
investors;

      (j) If the Debtors pursue a sale, provide financial advice
and assistance in connection with a sale, help identify potential
acquirers and, at the Debtors' request, contact such potential
acquirers;

      (k) If the Debtors pursue a sale, then at the Debtors'
request, Wasserstein shall assist in the preparation of a
memorandum to be issued in soliciting potential acquirers; and

      (l) If requested by the Debtors, assist the company and/or
participate in negotiations with potential acquirers.

The Debtors agree to pay Wasserstein:

      (a) a $150,000 Monthly Advisory Fee which first became due
and payable on July 1, 2000, and is due thereafter on each
monthly anniversary of that date. One-half of the amount of any
monthly advisory fee paid to the Firm is to be credited against
any sale transaction fee(s), restructuring transaction fee(s) or
financing transaction fee(s) payable to Wasserstein.

      (b) a Restructuring Transaction Fee, in connection with and
upon consummation of any restructuring equal to the sum of 0.5%
of the principal amount of Imperial's Senior Secured Funded
Indebtedness, plus 1.0% of the sum of the principal amount of the
Imperial's funded indebtedness or preferred stock, in each case,
junior to Imperial's Senior Secured Funded Indebtedness;

      (c) a Financing Transaction Fee, in connection with and
contingent upon the consummation of such financing equal to and
earned in full as of the close of the first stage of financing if
such is funded in one or more stages:

          (i) 2.0% of the gross proceeds of any secured and/or
              senior indebtedness issued;

         (ii) 3.0% of the gross proceeds of any general unsecured
              and/or senior subordinated indebtedness issued;

        (iii) 3.0% of the gross proceeds of any junior or equity-
              linked securities issued;

         (iv) 4.0% of the gross proceeds of any equity or equity-
              linked securities issued; and

          (v) with respect to any other securities or indebtedness
              issued, such placement fee or underwriting discount
              as shall be mutually agreed by the Debtors and the
              firm.

All of these fees are to be earned in full as of the closing of
the first stage of financing if done in stages.

      (d) a Sales Transaction Fee contingent upon the
consummation, and payable on the closing date, of a sale equal to
1.0% of the aggregate consideration received in connection with
any sale;

      (e) Reimbursements:

          (i) on a monthly basis for travel and other reasonable
              out-of-pocket expense incurred in connection with,
              or arising out of, the firms' activities under, or
              contemplated by the engagement; and

         (ii) for any sales, use or similar taxes incurred by the
              firm in connection with its engagement.

Kenneth Buckfire, a Managing Director of Wasserstein, declared
that:

      (i) The firm does not have any connection with the Debtors,
their creditors or any other party-in-interest, or their
respective attorneys or accountants;

     (ii) The firm does not hold or represent an interest adverse
to the estates; and

    (iii) The firm is a disinterested person.

Wasserstein disclosed that it and its affiliates may, from time
to time, make a market in, or have a long or short position in,
buy, sell, or otherwise effect transactions for customer accounts
or for their own accounts in the securities or liabilities of, or
perform investment banking or other services for, the Company,
but as to stock and liabilities transactions, only on an
unsolicited basis, and any investment banking services will not
be related to these Chapter 11 cases.

The engagement letter also contains an indemnification provision
whereby the Debtors will indemnify Wasserstein against all
losses, claims, damages, liabilities and expenses incurred by
them which are related to or arise out of actions or alleged
actions taken or omitted to be taken by Wasserstein under the
engagement, but not for the firm's gross negligence or willful
misconduct. (Imperial Sugar Bankruptcy News, Issue No. 3;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


IMPERIAL SUGAR: Selling Nutritional Products Business to Hormel
---------------------------------------------------------------
Imperial Sugar Company reached a definitive agreement to sell its
Diamond Crystal Brands nutritional products business to Hormel
Foods Corporation (NYSE: HRL) for $65 million in cash, subject to
certain post-closing adjustments. The transaction is subject to
approval by the U.S. Bankruptcy Court for the District of
Delaware as Imperial Sugar Company filed a petition for relief
under chapter 11 of the U.S. Bankruptcy Code on January 16, 2001.
Certain regulatory approvals have already been received,
including necessary clearances under the Hart-Scott-Rodino Act.
The transaction is expected to close during the second calendar
quarter of 2001.

Upon completion of the transaction and escrow, the Company
expects to apply approximately $50 million of the net after-tax
proceeds to permanently reduce debt. Included in the sale to
Hormel are product categories that are primarily sold to
hospitals and nursing homes -- Frozen Supplements, Dry and Ready-
to-Serve Supplements, modified products, and Thickeners and
Thickened and Pureed Products. The product lines, which are
included in the Company's foodservice segment, represented
approximately $50 million in net sales in the fiscal year ended
September 30, 2000. The asset sale does not include real property
or manufacturing facilities. Diamond Crystal Brands will continue
to manufacture specific products under a co-pack arrangement with
Hormel.

James C. Kempner, Chief Executive Officer, stated, "While Diamond
Crystal Brands nutritional products business has experienced
growth, it had become evident that the business did not fit the
strategic direction of Imperial Sugar. By selling the business,
Imperial Sugar will further reduce its debt, which remains a
priority as we continue to adjust our Company to industry
realities."

Walter C. Lehneis, President of Diamond Crystal Brands, stated,
"The divestiture of our nutritional products line will allow
Diamond Crystal Brands to streamline operations and refocus on
our core businesses of packets, kits, dessert and beverage mixes
and savory products. We will make every effort to provide a
seamless transition of our nutritional products business to
Hormel, ensuring that our customers are well serviced with the
quality products they have come to expect."

Imperial Sugar Company is the largest processor and marketer of
refined sugar in the United States and a major distributor to the
foodservice market. The Company markets its products nationally
under the Imperial(TM), Dixie Crystals(TM), Spreckels(TM),
Pioneer(TM), Holly(TM), Diamond Crystal(TM) and Wholesome
Sweeteners(TM) brands. Additional information about Imperial
Sugar may be found on its web site at www.imperialsugar.com.

                 About Hormel HealthLabs

Hormel HealthLabs, a subsidiary of Hormel Foods Corporation,
markets flavorful foods for people with special dietary needs,
such as dysphagia, bowel problems, malnutrition and diabetes.
Products are marketed to hospitals, nursing homes and other
health facilities. Originally known as American Institutional
Products (AIP), the business was acquired in 1994 and the
headquarters subsequently relocated to Austin, Minn. In December
2000, Hormel HealthLabs acquired the business and production
facility of Cliffdale Farms, located in Quakertown, Pa.


INNOFONE.COM: Needs More Funds to Continue as a Going Concern
-------------------------------------------------------------
Innofone.Com offers residential and small business long distance
telephone services, calling cards, Internet access and cellular
services through strategic "partnerships" with industry leaders
in the financial, retail and Internet markets. Currently, all of
its operations are conducted through its Canadian operating
subsidiary, Innofone Canada. The company has two other
subsidiaries, but they do not conduct operations at this time.

The company's independent auditors' report on its financial
statements includes additional comments for U.S. readers which
indicates that there exists certain factors that raise
substantial doubt as to the company's ability to continue as a
going concern.

Among the reasons cited as raising substantial doubt about the
ability to continue as a going concern is the fact that Innofone
has no current sources of financing. While it is attempting to
arrange private sources of financing, there can be no assurance
that it will be able to do so. Many investment bankers and
investors view companies with a "going concern" qualification as
less desirable for investment.

Accordingly, the company says it may have a more difficult time
raising equity capital or borrowing capital on acceptable terms
or at all. Its suppliers also might be less willing to extend
credit. In addition, its potential strategic partners might be
less willing to enter into a relationship with the company that
allows it to offer its services to their members if they believe
that Innofone will not be viable enough to provide service,
support, back-up, and follow-on products when needed. The
company's potential customers might be less willing to purchase
services for similar reasons.

Furthermore, the company feels it might be disadvantaged in
recruiting employees who might be concerned about the stability
of employment with Innofone. Therefore, the "going concern"
qualification can have severe adverse consequences to the
company.

Innofone says it will need additional funding to continue and
expand its business and to carry out its business plan. The
company currently has no revolving loans or lines of credit. In
addition, while the company is attempting to arrange funding
through private equity investments and other sources, there is no
assurance that these efforts will be successful.

Since August 1999, Innofone has raised a total of $2,806,602 from
private offerings. In addition, the company received a $500,000
"set up" fee from ePhone Telecom to ramp up its marketing
programs, which fee must be repaid or may be converted into stock
and warrants. The company advises that it cannot assure, however,
that it will be able to obtain the funds necessary to continue
and expand business on acceptable terms, or at all.

There is a limited operating history on Innofone.Com which can
evaluate its business and prospects, and it has not yet commenced
some of the services that it intends to offer in the future. It
has incurred net losses since inception.

For the year ended June 30, 2000, the company incurred net losses
of approximately $4,817,280. At June 30, 2000, there was
insufficient cash to fund its operations. The ability to achieve
and sustain profitable operations depends on many circumstances,
including Innofone's ability to establish effective distribution
channels, market demand, pricing and competition in the
telecommunications industry in the countries where it operates
and intend to operate. If it does not achieve and sustain
profitability, its ability to respond effectively to market
conditions, to make capital expenditures and to take advantage of
business opportunities could be negatively affected. In addition,
its prospects must be considered in light of the risks
encountered by companies like it developing products and services
in new and rapidly evolving markets. Its failure to perform in
these areas could have a material adverse effect on its business,
plan of operations and financial condition.


INTEGRATED HEALTH: Hiring & Paying Ordinary Course Professionals
----------------------------------------------------------------
Integrated Health Services, Inc. sought a further extension
through and including August 2, 2001 the authorization previously
granted under the Court's Prior Order pursuant to sections 327
and 328 of the Bankruptcy Code, to retain professionals that
render services to them in the ordinary course of their
businesses.

The Debtors also proposed that they be permitted to pay each
Ordinary Course Professional without a prior application to the
Court by such professional 100% of the fees and disbursements
incurrred, provided that an Ordinary Course Professional's fees
and disbursements do not exceed a total of $50,000 per month.

As the previous authorization expires on February 2, 2000, the
Debtors sought and obtained a bridge order to prevent the
expiration of this period pending the Court's entry of an order
on the motion. (Integrated Health Bankruptcy News, Issue No. 14;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


JUMBOSPORTS: Taps Bilzin Sumberg as Committee's Counsel
-------------------------------------------------------
The U.S. Bankruptcy Court, Middle District of florida, Tampa
Division, entered an order on February 5, 2001, granting approval
of the application of Jumbo Sports, Inc to employ the law firm
Bilzin Sumberg Sunn Baena Price & Axelrod, LLP as counsel for the
Official Committee of Holders of 4.25% Subrodinated Convertible
Debentures. The Court also approved the substitution of Scott
Baena and the Bilzin firm for Stroock & Stroock & Lavan LLP as
counsel for the Bondholders' Committee.


KCS ENERGY: Plan Declared Effective & Emerges from Bankruptcy
-------------------------------------------------------------
KCS Energy, Inc. (NYSE: KCS) completed the necessary steps for
its plan of reorganization to go effective and has emerged from
bankruptcy.

As previously reported, the plan was overwhelmingly accepted by
KCS' creditors and shareholders and confirmed by the United
States Bankruptcy Court for the District of Delaware, subject to
the issuance of $30 million of new convertible preferred stock
and the funding of a new exit facility in the form of either a
volumetric production payment or a new secured bank credit
facility.

For its exit facility, the Company entered into a volumetric
production payment with an affiliate of Enron North America Corp.
selling approximately 17.3% of its proven oil and gas reserves to
be delivered in accordance with an agreed schedule over the next
five years for net proceeds of approximately $176 million. These
funds together with the proceeds from the issuance of the
preferred stock and available cash were used to repay the
Company's two bank credit facilities in full, pay past due
interest on the Senior and Senior Subordinated Notes and repay
$60 million of Senior Notes. The remaining $90 million principal
amount of Senior Notes and $125 million principal amount of
Senior Subordinated Notes will be renewed under amended indenture
provisions, but without a change in interest rates. Trade
creditors will be paid in full on the effective date or in the
ordinary course of business and Shareholders will retain 100% of
their common stock, subject to dilution for conversion of the new
preferred stock.

"We are very pleased that the significant improvement in the
Company's performance and financial condition have enabled us to
complete our plan of reorganization and emerge from Chapter 11 a
much stronger company. Our debt has been reduced from over $400
million to $215 million today. In addition to the $185 million
reduction in debt, we expect to have over $30 million in cash on
hand at the end of February," said KCS President and Chief
Executive Officer James W. Christmas.

KCS is an independent energy company engaged in the acquisition,
exploration, development and production of natural gas and crude
oil with operations in the Mid-Continent and Gulf Coast regions.
The Company also purchases reserves (priority rights to future
delivery of oil and gas) through its Volumetric Production
Payment (VPP) program. For more information on KCS Energy, Inc.,
please visit the Company's web site at http://www.kcsenergy.com.


LERNOUT & HAUSPIE: Committee Retains BDO Seidman as Accountants
---------------------------------------------------------------
Michael Curran, at KBC BANK in New York, chairman of Lernout &
Hauspie Speech Products N.V. and Dictaphone Corp.'s Unsecured
Creditors Committee, asked Judge Judith H. Wizmur to authorize
the Committee's engagement and retention of BDO Seidman, LLP, in
New York, as accountants for the Unsecured Creditors Committee.

The Committee requested the engagement of the accountants to
perform the following services:

      (a) Analyze the financial operations of the Debtors both
pre- and postpetition, as necessary;

      (b) Perform forensic investigating services, as requested by
the Committee and counsel, regarding pre-petition activities of
the Debtors, in order to identify potential causes of action;

      (c) Analyze the Debtors' real estate interests, including
lease assumptions and rejections and potential real property
assets sales;

      (d) Perform claims analysis for the Committee, as necessary;

      (e) Verify the physical inventory of merchandise, supplies,
equipment and other material assets, such as intellectual
property, and liabilities, as necessary;

      (f) Assist the Committee in the review of monthly statements
of operation to be submitted by the Debtors;

      (g) Assist the Committee in its evaluation of cash flow
and/or other projections prepared by the Debtors;

      (h) Scrutinize cash disbursements of the Debtor on an
ongoing basis for the period subsequent to the Petition Date;

      (i) Analyze transactions with insiders, related and/or
affiliated companies;

      (j) Analyze transactions with the Debtors' financing
institutions;

      (k) Prepare and submit reports to the Committee, as
necessary;

      (l) Assist the Committee in its review of the financial
aspects of a plan of reorganization to be submitted by the
Debtors, or in arriving at a proposed plan of reorganization;

      (m) Attend meetings of creditors and confer with
representatives of the creditor groups and their counsel; and

      (n) Perform other necessary services as the Committee or the
Committee's counsel may request from time to time with respect to
the financial, business and economic issues that may arise.

To perform its work properly BDO Seidman will utilize the
services of various other member firms of BDO International;
however all work will be under the direct supervision of BDO
Seidman.

William K. Lenhart, a member of BDO Seidman, stated that for
services rendered, the firm shall receive compensation according
to its normal hourly rate plus reimbursement of out-of-pocket
expenses. The schedule of fees is as follows:

           Position                      Hourly rates
           --------                      ------------
           Partners .................... $300 to $450
           Senior Managers ............. $215 to $325
           Managers .................... $150 to $280
           Senior ...................... $100 to $170
           Staff ....................... $ 60 to $150

Mr. Lenhart declared that the firm has not had any business,
professional or other connection with the Debtors, their
attorneys or accountants or any other party in interest which
would prevent them from serving the Committee. However, Mr.
Lenhart disclosed that:

      (1) BDO Seidman, LLP, had been engaged by General Electric
Credit Corporation, the Debtors' post-petition secured lender, in
matters not related to the bankruptcy cases;

      (2) Various BDO International firm members have provided
services to Artesia Banking Corporation, N.V., and Bank Artesia,
a pre-petition unsecured lender to the Debtors matters not
related to the bankruptcy proceedings; and

      (3) BDO Germany had performed services for German affiliates
of State Street Bank & Trust, the indentured trustee for the
Dictaphone's unsecured bondholders and a member of the Unsecured
Creditors Committee in matters not related to the bankruptcy
proceedings. (L&H/Dictaphone Bankruptcy News, Issue No. 4;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


LOEWEN GROUP: Nine Illinois Debtors Sell Assets For $1,520,000
--------------------------------------------------------------
As part of The Loewen Group, Inc.'s Disposition Program, Elmwood
Acquisition Corporation and other Selling Debtors sought and
obtained the Court's authority: (i) to sell the funeral home and
cemetery businesses and related assets at the Sale Locations to
the Purchaser that the Debtors determine has submitted the
highest and best offer, free of all liens, claims and
encumberances; and (ii)to assume and assign to the Purchaser the
executory contracts and unexpired leases, pursuant to section 363
of the Bankruptcy Code.

Pursuant to the Asset Purchase Agreement dated December 18, 2000,
the Selling Debtors agreed to sell the cemetery businesses and
related assets at the Sale Locations to the Devonshire
Development, L.L.C. (the Initial Bidder) free of all liens,
claims and encumberances, at a purchase price of $1,520,000.

Qualified competing bid must exceed $1,565,000 i.e. 3% above the
Purchase Price. Any entity that desires to submit a competing bid
for the Sale Locations may do so in accordance with the Bidding
Procedures approved by the Disposition Order.

The Selling Debtors are:

      * Elmwood Acquisition Corporation, an Illinois corporation
      * Ruzich Funeral Home, Inc., an Illinois corporation
      * Ruzich Funeral Home, Inc., an Indiana corporation
      * Chapel Hill Memorial Gardens & Funeral Home Ltd., an
        Illinois corporation
      * Mittendorf Calvert Funeral Home, Ltd., an Illinois
        corporation
      * Memorial Gardens Association, Inc., an Illinois
        corporation
      * Glendale Memorial Gardens, Inc., an Illinois corporation
      * Mount Hope Woodlawn Corporation, an Illinois corporation
      * Pineview Memorial Park, Inc., an Illinois corporation

The Sale Locations are:

      (1) Ruzich Funeral Home, Inc., an Illinois corporation, dba
          Ruzich Funeral Home (2758)

      (2) Ruzich Funeral Home, Inc., an Indiana corporation, dba
          Ruzich Funeral Home (2759)

      (3) Chapel Hill Memorial Gardens & Funeral Home Ltd., an
          Illinois corporation, dba Chapel Hill Funeral Home
          (3446)

      (4) Mittendorf Calvert Funeral Home, Ltd., an Illinois
          corporation, dba Mittendorf-Calvert Funeral Home (3579)

      (5) Elmwood Acquisition Corporation, an Illinois
          corporation, dba Eden Memorial Park (2119)

      (6) Chapel Hill Memorial Gardens & Funeral Home Ltd., an
          Illinois corporation, dba Chapel Hill Memorial Park
          (5584)

      (7) Memorial Gardens Association, Inc., an Illinois
          corporation, dba Kankakee Memorial Gardens (5723)

      (8) Glendale Memorial Gardens, Inc., an Illinois
          corporation, dba Resthaven Memorial Gardens (5725)

      (9) Mount Hope Woodlawn Corporation, an Illinois
          corporation, dba Mount Hope Cemetery (5735)

     (10) Mount Hope Woodlawn Corporation, an Illinois
          corporation, dba Roselawn Cemetery (5736)

     (11) Mount Hope Woodlawn Corporation, an Illinois
          corporation, dba Woodlawn Cemetery (5737)

     (12) Mount Hope Woodlawn Corporation, an Illinois
          corporation, dba Lincoln Memorial Gardens (5738)

     (13) Pineview Memorial Park, Inc., an Illinois corporation,
          dba Pine View Memorial Park (5770)

One of the Sale Locations, the Ruzich Funeral Home in Whiting,
Indiana (the ROFR Location), is subject to a right of first
refusal granted by Ruzich Funeral Home, Inc. to David W. and
Judith A. Ruzich. Counsel to the Debtors has notified the ROFR
Holders of the Initial Bidder's offer for and allocation of
$567,000 of the Purchase Price to the ROFR Location, and also of
ROFR Holder's right to bid on and participate in any auction for
the ROFR Location in accordance with the Bidding Procedures. The
Debtors believe they have performed their obligations to the ROFR
Holders and may proceed with the sale of the ROFR Location.

Pursuant to section 365 of the Bankruptcy Code, the Selling
Debtors will assume 81 executory contracts and unexpired leases.
The Selling Debtors will subsequently assign its rights and
obligations under the Assignment Agreements to the Initial
Bidder. The Debtors do not believe that there are any monetary
defaults or cure costs associated with the assumption and
assignment of the Assignment Agreements. The Debtors tell the
Court that they are continuing to review each of the Assignment
Agreements and will notify the nondebtor party to an Assignment
Agreement immediately if they identify any cure obligation
associated with that agreement.

In accordance with the Net Asset Sale Proceeds Procedures, the
Debtors will use the proceeds generated to repay any outstanding
balances under the Replacement DIP Facility and deposit the net
proceeds into an account maintained by LGII at First Union
National Bank for investment, pending ultimate distribution on
court order.

Neweol would sell and the Initial Bidder would purchase certain
accounts receivable related to the Sale Locations, pursuant to a
purchase agreement between Neweol and the Initial Bidder. The
amount of the Neweol Allocation will be determined immediately
prior to closing. The Neweol Allocation will not be utilized or
deposited in the manner contemplated by the New Asset Sale
Proceeds Procedures. (Loewen Bankruptcy News, Issue No. 33;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


LTV CORPORATION: Court Okays Tin Mill Business Sale to U.S. Steel
-----------------------------------------------------------------
The LTV Corporation (OTC Bulletin Board: LTVCQ) said that the
U.S. Bankruptcy Court approved the sale of its Tin Mill Products
Business to the U. S. Steel Group of USX Corporation.

Under the terms of the agreement, U. S. Steel will lease the land
and take title to the buildings, facilities and inventory of the
Indiana Harbor tin operations, which it will operate as an
ongoing business. Tin mill employees at Indiana Harbor will
become U. S. Steel employees. U. S. Steel will also have the
right to transfer certain tin line equipment from LTV's Aliquippa
facility to U. S. Steel's tin operations.

The sale of the Tin Mill Products business will benefit LTV's
chapter 11 reorganization through U.S. Steel's assumption of
liabilities valued at about $80 million. The liabilities are
related primarily to tin mill employee obligations. LTV also will
receive a five- year contract to supply steel to U.S. Steel's tin
mill operations.

The LTV Corporation is a manufacturing company with interests in
steel and metal fabrication. LTV's Integrated Steel segment is a
leading producer of high-quality, value-added flat rolled steel,
and a major supplier to the transportation, appliance, electrical
equipment and service center industries. LTV's Metal Fabrication
segment consists of LTV Copperweld, the largest producer of
tubular and bimetallic products in North America and VP
Buildings, a leading producer of pre-engineered metal buildings
for low-rise commercial applications.


NETOBJECTS: Anticipates More Revenue Shortfalls in the Future
-------------------------------------------------------------
NetObjects Inc. provides both online and software solutions that
enable small businesses to build, deploy and maintain Internet
web sites, and applications to conduct e-business; and enable
large enterprises to create corporate intranets.

The company earns revenues from software license fees through
direct licenses to enterprises, through important strategic
relationships such as its relationships with IBM and through its
indirect (OEM) distribution channel.

NetObject has incurred substantial net losses in each fiscal
period since its inception and, as of December 31, 2000, had an
accumulated deficit of $122 million. Such net losses and
accumulated deficit resulted, according to the company, primarily
from the significant costs incurred in the development of
products and establishing brand identity, marketing organization,
domestic and international sales channels, and general and
administrative infrastructure. The company expects to continue to
incur substantial losses from operations for the foreseeable
future.

NetObject indicates that its future operating results must be
considered in light of its limited operating history and the
risks, expenses and difficulties frequently encountered by
companies in early stages of development, particularly companies
in rapidly evolving markets such as the market for web site
building software and services. To achieve the company's new
business objectives NetObject realizes it will need to do the
following:

      |X| Become a leading supplier of B2B online services for
partners that reach small business;

      |X| Continue to develop successfully new versions of its
product offerings;

      |X| Continue to be a leading provider of e-business product
solutions for building Web sites, and of online services to small
businesses;

      |X| Respond quickly and effectively to competitive, market,
and technological developments;

      |X| Control expenses;

      |X| Continue to attract, train, and retain qualified
personnel in the competitive online market place: and

      |X| Maintain existing relationships and establish new
relationships with leading Internet hardware, software and online
companies, such as its existing OEM resellers.

There is no assurance that the company will achieve or sustain
profitability. Moreover, particularly as NetObject's transition
to a new business model, it may be unable to adjust spending in a
timely manner to compensate for both anticipated and
unanticipated revenue shortfalls. Accordingly, any significant
shortfall of revenues in relation to expectations would cause
significant declines in the company's operating results.


NORTHPOINT COMMUNICATIONS: Wins Final Court Nod On $38MM DIP Loan
-----------------------------------------------------------------
Shortly after winning final bankruptcy court authorization to
borrow under a $38 million debtor-in-possession financing
agreement, NorthPoint Communications Group Inc. has won several
court victories that will allow it to move forward with its $1
billion pre-petition state court action against Verizon
Communications Inc. Judge Thomas Carlson of the U.S. Bankruptcy
Court in San Francisco approved the DIP financing, which a group
of NorthPoint's existing lenders will provide, led by agent
Canadian Imperial Bank of Commerce. The court also authorized
NorthPoint to use cash collateral.  (ABI World, February 21,
2001)


OWENS CORNING: Assuming Joint Venture Agreement with Ikomat
-----------------------------------------------------------
By agreement in 1999, Owens Corning and Ikomat, as successor to
Goldis Enterprises, Inc., and certain of its affiliates have
agreed to enter into a joint venture to build and operate a
fiberglass mat production facility in Danville, Illinois. IKO is
a Canadian roofing shingle manufacturer. The Fiberteq Facility
will be a state-of-the-art plant, capable of producing a low-cost
fiberglass mat in significant quantities. Glass mat is an
integral element of fiberglass residential asphalt roofing
shingles. The Fiberteq Facility is expected to be operational by
mid-year 2001.

Under the joint venture agreement, Owens and IKO will share
equally in the Fiberteq Facility's output, and will similarly
divide equally fixed costs and capital contributions to be paid
in connection with the Facility. The Facility is designed to be a
"zero-profit" enterprise in that both Owens and IKO will "take"
mat produced at the facility at cost.

Each party is liable for one-half of the Facility's construction
costs, which the parties anticipate will total approximately $50
million. The Joint Venture Agreement provides that Owens may
instruct the joint venture to borrow from IKO up to one-half of
Owens Corning's $25 million in estimated construction cost
obligations, and Owens is the guarantor of the joint venture's
obligations to IKO under such a loan. As of the Petition Date,
the joint venture had incurred liabilities to IKO in a principle
amount of $1.9 million. As of December 31, 2000, the Debtors had
committed approximately $7.8 million, in both cash and loan
guarantees, toward the construction of the Facility.

The Debtors believe the costs associated with assuming the Joint
Venture Agreement are justified by the significant benefits that
the Debtors expect to realize. First, the Debtors will be the
exclusive supplier of glass fiber, at market price, used to
produce glass mat at the Facility. Thus the Debtors will gain a
significant customer for their glass fiber. The Facility will
also provide the Debtors with needed glass mat production
capacity - capacity that will help the Debtors meet the
increasing demand for their roofing products.

Further, assumption of the joint venture agreement will
strengthen the business relationship between Owens Corning and
IKO. Clearly, continuity of this relationship is critical to
assure the smooth operation of the Facility - which in large part
will depend on cooperation between the parties. A strong business
relationship between Owens Corning and IKO will lead to
additional business opportunities for Owens Corning. This
relationship with IKO already has resulted in significant
additional sales, as the Debtors have obtained business from IKO
that previously went to competitors. The Debtors expect that the
sophisticated production capabilities of the Fiberteq Facility
may enable them to open new markets for their glass mat beyond
the roofing shingles market.

Because IKO is understandably hesitant to commit further funds to
a joint venture project like the Fiberteq Facility that the
Debtors may reject in these Chapter 11 cases, the Debtors believe
that their failure to assume the Joint Venture Agreement may
delay completion of the Fiberteq Facility through construction
delays, and have other harmful effects on Owens Corning's
interest in the joint venture. The Debtor Owens Corning therefore
asked Judge Walrath to authorize the assumption of the joint
venture agreement with IKO on the terms stated. (Owens Corning
Bankruptcy News, Issue No. 9; Bankruptcy Creditors' Service,
Inc., 609/392-0900)


PILLOWTEX CORPORATION: Rejects Aircraft Lease With Fleet Bank
-------------------------------------------------------------
Carl N. Kunz, III, Esq., at Murphy Spadaro & Landon, and C.
Edward Dobbs, Esq., of Parker Hudson Rainer & Dobbs LLP,
representing Fleet National Bank, signified their limited
objection to Pillowtex Corporation's Motion for rejection of the
aircraft lease.

The Debtors sought to reject the aircraft lease in its entirety.
While the Debtors continue to manage their business and assets as
Debtors-in-Possession, the aircraft remains in the Debtors'
possession. However, the relief sought in the Motion does not
specify what disposition is to be made of the aircraft after the
rejection of the lease.

Thus, the Lessor's objection to the Motion is based on the extent
to which the Motion does not contemplate, and the proposed Order
does not expressly provide, for the Debtor's abandonment of the
aircraft upon rejection of the Lease. The proposed Order also
does not provide for relief from automatic stay in order to allow
the Lessor to protect and preserve its interest in the aircraft
by taking possession of the aircraft and disposing it.

This limited objection is made without prejudice to the right of
the Lessor to file a proof of claim in the Chapter 11 case. The
Bank also reserves the right to recover any damages whether on
account of the rejection of the Lease or breaches of the Lease by
the Debtors.

After consideration of this limited objection, Judge Robinson,
authorized the Debtors Pillowtex Corporation, Beacon
Manufacturing Co., Fieldcrest Cannon, Inc., and Leshner
Corporation to reject the Aircraft Lease. However, Judge Robinson
held that the Debtor Lessees are deemed to have abandoned all
equipment and other property subject to such lease upon the
effectiveness of rejection.

Judge Robinson further ruled that Fleet is entitled to take
immediate possession of the Gulfstream aircraft on the rejection
date, and to exercise all of its rights and remedies under the
aircraft lease and applicable law with respect to repossession of
the aircraft. The Judge instructed the Debtor Lessees to
cooperate with Fleet in facilitating its taking possession of the
aircraft by delivering possession of the aircraft to a
representative of Fleet's agent, Aviation Management Consulting,
Inc., at the Gulfstream's hangar within three business days of
the rejection date. (Pillowtex Bankruptcy News, Issue No. 4;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


PITTSBURGH-CANFIELD: Court Sets May 16 Bar Date for Filing Claims
-----------------------------------------------------------------
On January 25, 2001, the U.S. Bankruptcy Court, Northern District
of Ohio, entered an order setting May 16, 2001 as the last date
by which holders of certain claims against any of the debtors
must file proofs of claim against Pittsubrgh-Canfield
Corporation, et al.


RK POLYMERS: Moody's Lowers Proposed Senior Credit Facility To B1
-----------------------------------------------------------------
Moody's Investors Service lowered its rating on RK Polymers LLC's
proposed $350 million senior secured credit facilities, maturing
2007-2009, to B1 from Ba3.

Other ratings are as follows:

      * The senior implied rating is at B1

      * The senior unsecured issuer rating is at B2

Rating outlook is stable.

Moody's says that the rating action is due to the lower sales and
earnings in the fourth quarter of 2000 than were previously
anticipated by the company at the time of the initial rating on
January 10, 2001, and resulting higher pro forma leverage and
reduced creditor protection more appropriate for this rating
category. Reportedly, fourth quarter sales and EBITDA were about
7% and 34% lower respectively than expected. The company
attributed the change primarily to the slowdown in the U.S.
economy, which adversely affected volumes and prices, and to a
weaker Euro, Moody's reports.

Based in Houston, Texas, RK Polymers LLC, is a leading global
producer of styrenic block copolymers, or SBCs, which are
synthetic elastomers used in products to impart characteristics
such as flexibility, resilence, strength, durability and
processability. According to Moody's, the company has been formed
to acquire the elastomers business from Royal Dutch/ Shell Group
of Companies (Shell).


SAFETY-KLEEN: Paying Officer and Director Defense Costs
-------------------------------------------------------
Judge Walsh authorized Safety-Kleen Corp. to make payments on
behalf of certain officer and defense costs and expenses, now or
becoming due on or before June 30, 2001, in connection with
litigation pending outside of the Bankruptcy Court for the
District of Delaware, but held that the aggregate amount of
defense costs paid under this Order may not exceed $600,000, and
further may not exceed $400,000 before March 31, 2001.

Further, the Judge directed that the defense costs will be
subject to review by the Debtors, counsel for the Debtors,
counsel for the Debtors' pre and postpetition lenders, and
counsel for the Creditors' Committee. Counsel for the officers
and directors are ordered to provide these parties with adequate
information, including information relating to fees and expenses,
taking into account the necessity of maintaining the
attorney/client privilege, to permit these parties to determine
the reasonableness of these fees and related expenses. Any
objections to these fees and expenses are to be served upon the
defense counsel within ten days of receipt of the work
application. If no objections are timely presented, the Debtors
are authorized, in their sole discretion, to make payments to the
defense counsel under this Order. (Safety-Kleen Bankruptcy News,
Issue No. 13; Bankruptcy Creditors' Service, Inc., 609/392-0900)


TELIGENT INC.: Moody's Cuts Senior Debt Ratings To Ca From Caa1
---------------------------------------------------------------
Moody's Investors Service downgraded Virginia-based Teligent,
Inc.'s senior unsecured debt rating to Ca from Caa1. Moody's also
lowered the following ratings:

      * the company's senior secured credit facility to Caa2 from
        B3,

      * senior implied rating to Caa3 from B3 and

      * issuer rating to Ca from Caa1.

The outlook remains negative.

Moody's relates that the company, on November 9, 2000, was in
discussions with shareholders, banking institutions and vendors
to raise additional funding. On December 7, 2000, Teligent
secured a commitment from Rose Glen Capital Management to
purchase up to $250 million of Teligent stock over an 18-month
period. However, this agreement includes a number of terms,
including a material adverse change provision, and conditions
relating to the market price of Teligent's stock and the amount
of Teligent stock that RCG may hold at any time, that may
preclude Teligent from drawing any or all of the $250 million.
Accordingly Moody's does not consider that the terms of the RGC
agreement can assure the company with the funding necessary to
continue its operations beyond mid 2001.

Moody's is concerned that, with the absent additional funding,
Teligent's current liquidity position will provide funding for
its operations only through the second quarter of 2001. The
rating agency also expressed its concern regarding the likely
recovery prospects of all debt-holders in a distress scenario.

The company is said to have recently implemented cost reducing
measures, including a workforce reduction, as well as a focus on
driving on-net sales and a wholesale-only sales effort in nine of
its markets. According to Moody's, while Teligent has
demonstrated good operational performance to date in terms of
growth in revenues, building connections and access lines, its
revenue base continues to include substantial levels of lower
margined long distance resale.


TRANS WORLD: Court Denies Continental Bid To Halt Auction Process
-----------------------------------------------------------------
U.S. Bankruptcy Judge Peter Walsh denied Continental Airlines
Inc.'s motion to put the auction process of Trans World Airlines
on hold until an appeal of the process can be decided by a higher
court, according to Reuters.

Continental Airlines Inc. reportedly objected to and appealed a
court order approving a March 5 auction of TWA's assets, alleging
that the process is slanted to favor a bid by American Airlines'
parent company AMR Corp. Along with Continental, Northwest and
investor Carl Icahn have also objected to the auction process,
saying that AMR's offer is "illusory," because it does not commit
AMR to buying any particular assets at any particular price, ABI
World relates.

Continental's expedited appeal before the Third Circuit Court, is
expected to be decided by late March or early April.

ABI World reports that at a weekend hearing last month that led
to Judge Robinson's auction order, Continental said it would
consider paying up to $400 million for certain TWA assets, a move
that would leave TWA smaller, but still freestanding. At the same
time, Northwest said it was interested in buying TWA's stake in
the ticket reservations company Worldspan that AMR valued at up
to $200 million while Icahn said he would help finance any bid
that would leave TWA an independent airline. All three parties
objecting to the takeover claim any rival bidder would be chilled
by the $65 million breakup fee that AMR will receive if TWA is
sold to a third party, ABI World says. AMR has offered to pay
$500 million in cash to buy TWA's assets.

According to a Reuters report, Walsh said Continental's assertion
that it might pay up to $400 million for certain TWA assets and
leave the airline smaller but freestanding, ``was totally
unrealistic in light of TWA's present circumstances.''

On March 9, a hearing will be held wherein Judge Walsh will rule
on whether to approve the auction results. Judge Walsh will also
consider a motion by TWA to reject its Karabu discount ticket
contract valued at $200 million with Icahn, TWA's former chief
executive.

AMR hopes to close the TWA acquisition by May 31, assuming it has
obtained federal regulatory approval by then and the appeals
court has not reverse Judge Robinson's order on the auction
process, Reuters reports.


TRW INC.: Moody's Cuts Senior Long-Term Debt Rating To Baa2
-----------------------------------------------------------
Moody's Investors Service downgraded TRW Inc.'s long-term senior
unsecured debt rating for debentures, medium term notes, IRB's,
and bank revolving credit facilities to Baa2 from Baa1.
Accordingly, this concludes the rating agency's pending review of
the company's debt ratings for possible downgrade.

TRW Inc's rating for the 415 shelf registration for senior
securities was also lowered to (P)Baa2 from (P)Baa1. While TRW's
short-term debt rating, which was not under review, is confirmed
at the Prime-2 level.

The rating action is due to the rapidly deteriorating automotive
end markets, particularly in North America, that have resulted in
the company's weakening financial results over the last half of
2000, as well as the prospects for continued operating challenges
during 2001, Moody's states. Also, the margins are also said to
have contracted in TRW's important aerospace and information
systems businesses, due largely to equity investments in TRW's
technology bank. Moody's notes that as a result, consolidated
cash flows have weakened and further debt reduction, a major goal
of management, will take longer than originally anticipated.

According to Moody's, the rating change also incorporates its
expectation that proceeds from additional asset sales will be
applied to reducing debt. Although the company has made good
progress in reducing debt since the LucasVarity acquisition,
absolute debt levels remain elevated, the rating action agency
says.

Moody's also relates that the Management's ability to continue to
take out costs and reduce debt through potential asset sales and
free cash flow in today's economic environment will be critical
in achieving improving credit metrics more suitable for the Baa2
rating category.

TRW Inc. is based in Cleveland, OH. It is a diversified company
that provides products and services with high technological
content to the automotive and space & defense markets.


WHEELING-PITTSBURGH: Ohio Seeks Enforcement of Environmental Laws
-----------------------------------------------------------------
The State of Ohio currently has a case pending in state court
against Wheeling-Pittsburgh Steel Corp. for the purpose of
enforcing Ohio's environmental laws protecting human health and
the environment. Ohio told Judge Bodoh that this state court case
is exempt from the restraints of the automatic stay of creditor
action attendant upon the filing of the petitions commencing
these cases because the case is a continuation of an action to
enforce the State's police and regulatory power. However, the
judge in the state court case has asked that the State obtain an
Order from Judge Bodoh granting relief from the stay to permit
the state court suit to proceed.

The State alleged that Wheeling-Pittsburgh Steel Corporation
generates wastes at its Steubenville and Yorkville plants in
Ohio, and that the Debtor has improperly managed and disposed of
its waste in the course of its activities in violation of Ohio's
hazardous waste laws and water pollution laws and rules. These
violations include the release of pollutants into the Ohio River,
the release of hazardous waste onto the ground, failure to ensure
adequacy of the new tank system design and construction, failure
to ensure secondary containment for the tank system, failure to
use spill prevention controls or practices for tank systems,
failure to respond to leaks or spills from tank systems, as well
as other violations of Ohio environmental laws.

In its state court suit, Ohio asked that the Debtor be
permanently enjoined and ordered to comply with Ohio's hazardous
waste and water pollution laws and regulations, and that a civil
penalty equaling $10,000 per day for each day of each alleged
violation be assessed for past violations of these laws.
(Wheeling-Pittsburgh Bankruptcy News, Issue No. 5; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


WKI HOLDING: Moody's Downgrades Senior Subordinated Notes To Caa1
-----------------------------------------------------------------
Moody's Investors Service lowered the ratings for WKI Holding
Company, Inc. and placed them on review for possible further
downgrade. Accordingly, this is pending the negotiation of an
amendment to the company's bank credit facilities.

The following ratings affected are:

      * $200M senior subordinated notes due 2008, Caa1 from B3;

      * $570 senior unsecured credit facilities, B2 from B1; ($275
        million revolving credit facility and $295 million term
        loan currently secured by a pledge of stock, but not
        assets)

      * Senior Implied Rating, B2 from B1;

      * Issuer Rating, B3 from B2

According to Moody's, the ratings show the company's high
effective leverage and weak debt protection measures resulting
from its 1999 acquisition of the EKCO Group, Inc. and General
Housewares Corp., and the negative impact related integration,
manufacturing and distribution issues have had on its operating
performance and cashflow. Moody's also took into account WKI's
strong brand name products, its relationships with the major mass
merchants and the support provided by its owners, KKR and
affiliates, mainly Borden Inc.

Moody's says that WKI is experiencing difficulties. With a new
CEO in place, it is said to address these with an evaluation and
implementation of further cost cutting measures and an amendment
to its bank credit facilities, that reflects its current
financial position and provides additional liquidity. The company
has begun negotiations in the fourth quarter of 2000 to amend the
credit facilities due to potential financial covenant violations
as of FYE 12/31/2000 while, in the interim, Borden Inc. has
provided WKI with a $40 million line of credit to meet its
seasonal working capital needs, Moody's reports.

The ratings have been placed on review subject to the final
structure of the amended credit facilities. The actual debt
ratings will be evaluated based upon the collateral granted and
the amount of the secured debt in relation to total debt, Moody's
says.

WKI, in Elmira, New York, manufactures and markets household
products under such names as Pyrex, Corelle, Revere Ware, and
Visions. The company's product categories include bakeware,
dinnerware, kitchen tools, range top cookware and cutlery.


WORLD OF SCIENCE: Revised List of 20 Largest Unsecured Creditors
----------------------------------------------------------------
World of Science, Inc., a New York, Corporation filed an amended
list of creditors holding the 20 largest unsecured claims (All
claims are disputed, trade claims):

      Creditor                             Amount of Claim
      --------                             ---------------
      Natural Science Industry Ltd.           $779,371
      Binary Arts Corp.                       $222,276
      Estes Industries                        $156,270
      Myland Enterprises                      $153,747
      Educational Designs, Inc.               $107,374
      New Creative Enterprises                 $84,772
      USGift.com                               $81,695
      Creativity for Kids                      $80,000
      Buffalo Games                            $62,258
      Toysmith                                 $54,865
      Top of the Line                          $49,988
      Pressman Toy Corp                        $48,468
      Andrews & McNeel                         $47,725
      Swarovski Consumer Goods Ltd             $46,638
      Retail Products Corporation              $44,981
      Workman Publishing Company               $44,052
      Figi Graphics                            $42,273
      Curiosity Kits                           $39,528
      Rupert, Gibbon & Spider Inc.             $38,384
      Sterling Publishing Co., Inc.            $31,408


BOOK REVIEW: ITT: The Management of Opportunity
-----------------------------------------------
Author:  Robert Sobel
Publisher: Beard Books
List Price:  $34.95
Review by Gail Owens Hoelscher

We all know how it ends, but whew, what a ride!  An enterprising
man envisions a world-wide telecommunications company and guides
it vigilantly through hard times; his successor radically changes
course, buying up hundreds of unrelated companies; economic
conditions and the national mood change; the conglomerate sags
under its own weight; the next CEO retrenches and then wards off
hostile takeovers; the company is sold.

This account of the ITT story was published in 1982, 15 years
before the end.  The author was given complete access to records
and files, and employees were instructed to be candid and
forthcoming. The result is evenhanded, thorough, and well
written, and provides solid historical background for and
thoughtful analysis of the various events.

ITT founder Sosthenes Behn was born in the Caribbean and educated
in Europe.  He and his brother began their hoped-for
"International System" of worldwide interconnected telephone
lines in 1920 by acquiring two small telephone companies in
Puerto Rico and Cuba.  Sobel recounts ITT's forays into Spain,
Mexico, and South America; attempts to purchase RCA
Communications in the late 1920s; acquisitions in France and
Germany; near insolvency during the Depression; Behn's
partisanship in the Spanish Civil War; and Behn's relationship
with Germany before World War II and with Argentina under Peron.
After the War, with his International System in shambles, Behn
turned to the U.S. market, but feeling inadequate to the task,
stepped down. Eventually, his successor was found in Harold
Geneen, an outsider from Raytheon.

Under Geneen, ITT quickly became one of the fastest growing
corporations in the U.S.   ITT once acquired some 20 unrelated
companies in one month.  Sales grew from $930 million in 1961 to
$8 billion in 1970. Geneen's acquisitions sometimes complemented
one another, such as Sheraton, Continental Baking, and Avis, but
were often random, such as The Hartford (insurance), Rayonier
(forest products), and O.M. Scott (lawn care).

ITT's descent began in 1966, when it tried to acquire ABC.
National sentiment against conglomerates had become vitriolic and
this merger became its target.  As Sobel put it, "Perhaps not
since the end of the war had so many large groups arrayed
themselves against a single corporation involved in a merger."
In the end, despite FCC approval of  the merger in two separate
rulings, ITT and ABC yielded to the Department of Justice, media
censure, and public opinion, and abandoned merger plans.

Next came a variety of allegations against ITT, some well
substantiated and all well publicized: funding Salvador Allende's
opponents in Chile's 1970 presidential elections; peddling of
influence in the Nixon White House to rid the DOJ of
trustbusters; and exchange of campaign donations for use of a
Sheraton hotel as the 1972 Republican National Convention
headquarters in San Diego. All the while, ITT's poor handling of
several antitrust cases were also making headlines. And then came
recession in 1973.

Geneen had difficulty adjusting to ITT's new business climate.
His theory that growth could serve as business strategy had been
disproved.  ITT's stock fell from 60 in early 1973 to 12 in late
1974. Under pressure from ITT's board, Geneen stepped down in
1977, but masterminded the dismissal of his successor, Lyman
Hamilton, and installation of Rand Araskog in 1978. When the book
ends in 1982, Araskog had begun a plan of coherent divesting and
reorganizing the company into more manageable segments, prelude
to the dismantling that was to take place in the hostile-takeover
wars.

Robert Sobel, who died in 1999, was a highly regarded academic
and business historian with a tremendous array of books and news
articles to his credit.

                           *********

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

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Each Friday's edition of the TCR includes a review about a book
of interest to troubled company professionals. All titles are
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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
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                      *** End of Transmission ***