TCR_Public/010620.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

             Wednesday, June 20, 2001, Vol. 5, No. 120

                            Headlines

360NETWORKS: Withdraws Plans to Acquire ISP NetRail
ADVOCAT INC.: Selling Canadian Unit to Counsel Corp. for $8 Mil
ARMSTRONG WORLD: Selling Pennsylvania Property To Connectiv
AVATEX: Reviewing Alternatives To Continue as A Going Concern
DRUG EMPORIUM: U.S. Trustee Kicks Four Members from Committee

EDISON INTERNATIONAL: Fitch Gives Comments On Ratings
EDISON: Trans-Elect To Offer $1.8B For SCE's Transmission Lines
FINOVA GROUP: Stipulation With First Union re Employee Motion
HARNISCHFEGER: Will Hold Post-Chapter 11 Presentation On June 25
HIH INSURANCE: Liquidator Obtains Injunction Against Creditors

HOLLYWOOD FUNDING: S&P Cuts Note Rating To D After Default
INDEPENDENT INSURANCE: Fitch Slashes Rating to DD From B
INDEPENDENT INSURANCE: AM Best Further Cuts Rating To F From B-
LECHTERS: Next Status Conference Scheduled for September 11
LIVING.COM: Big Lots Buys Bankrupt Internet Retailer's Inventory

LOEHMANN'S HOLDINGS: Annual Stockholders' Meeting Is On July 23
LTV CORPORATION: Modifies Nonunion Employee Severance Benefits
LTV CORP.: Says Banks Will Help With $250 Mil Loan Application
METAL MANAGEMENT: Set To Emerge From Chapter 11 Before Month-End
MIDLAND FOOD: Prevails in Contest over Use of Cash Collateral

NETSOL INTL: Obtains Restraining Order Against Shareholder Group
OWENS CORNING: Wants To Assume Roxboro NC Lease & Add Guaranty
PACIFICARE HEALTH: Fitch Rates Proposed Debt Issue at BB+
PHOENIX RESTAURANT: Appoints S. Pyeatt As New Head Of Operations
PIONEER CO.: Reaches Restructuring Agreement With Senior Lenders

PNI TECHNOLOGIES: Case Summary & 20 Largest Unsecured Creditors
POLAROID: Fitch Downgrades Senior Unsecured Debt Rating to CCC-
PRESIDENT CASINOS: Shareholders' Meeting Set For August 28
PSINET: Obtains Court Nod To Continue Customer-Related Practices
PYCSA PANAMA: S&P Cuts Senior Secured Bond Rating to D From CC

RELIANCE GROUP: Court Okays Use Of Existing Bank Accounts
SENIOR HOUSING: Issues $25 Million Trust Preferred Securities
SMARTEGG PRODUCTIONS: StrategyWeb Subsidiary Ceases Operations
SPINCYCLE INC.: Senior Discount Noteholders Approve Equity Swap
TITANIUM METALS: Names Patrick Murray As New Director

U.S. OFFICE: Wants More Time to File a Plan of Reorganization
VLASIC FOODS: Rule 9027 Removal Period Extended Through July 30
W.R. GRACE: APD Committee Retains Ferry & Joseph As Co-Counsel
WARNACO GROUP: Engages Skadden Arps As Special Counsel
WINSTAR COMMUNICATIONS: Committee Taps Bayard As Local Counsel

* Meetings, Conferences and Seminars

                            *********

360NETWORKS: Withdraws Plans to Acquire ISP NetRail
---------------------------------------------------
360networks (NASDAQ: TSIX and TSE: TSX) announced it no longer
intends to acquire NetRail, a wholesale Internet service
provider, in an all-stock transaction. The company announced
plans to acquire NetRail earlier this year.

                   About 360networks

360networks (NASDAQ: TSIX and TSE: TSX) offers network services
to telecommunications and data-centric organizations.
360networks is developing one of the largest and most
technologically advanced fiber optic mesh networks in the world.
By early 2002, the planned network will span approximately
140,000 kilometers (86,000 miles) and link approximately 100
major cities in North America, Europe, South America and Asia
with terrestrial routes, undersea cable systems and network
capacity.


ADVOCAT INC.: Selling Canadian Unit to Counsel Corp. for $8 Mil
---------------------------------------------------------------
Advocat Inc. (OTCBB:AVCA.OB) and Counsel Corporation (CXS.TSE)
have signed a letter of intent pursuant to which Counsel is to
acquire Diversicare Canada Management Services Co., Inc.,
Advocat's Canadian subsidiary. Under the letter of intent,
Counsel is to acquire 100% of the outstanding stock of
Diversicare Canada for U.S.$8 million. The transaction, expected
to close on June 29, 2001, is subject to receipt of applicable
approvals and the approval of a definitive purchase agreement.

"Upon consummation of the sale, the proceeds for Diversicare
Canada will be used, in part, to meet short-term obligations to
our lender, with the balance providing working capital and funds
for facility improvements," stated Dr. Charles W. Birkett,
chairman and chief executive officer of Advocat. "Although our
Canadian operations have been a strong support through difficult
times in the U.S. nursing home business, the proposed sale will
provide Advocat with an opportunity to better address
significant liquidity issues including negotiations with lenders
for loan covenant waivers and/or amendments."

While this letter of intent is subject to a variety of
conditions, including the negotiation of definitive agreements,
Advocat is encouraged that it will be able to complete the sale
of its Canadian Subsidiary. However, no assurances can be given
that a definitive agreement will be reached or that the sale
will be consummated.

"I want to personally express my appreciation to our loyal
Canadian associates who have been with us through the best and
the worst of times in the past two decades," continued Dr.
Birkett. "The Diversicare operations represent the beginnings of
our company, and this proposed sale represents our focus on
Advocat's U.S. operations that include 84 facilities, including
33 assisted living facilities with 2,582 units and 51 skilled
nursing facilities containing 5,436 licensed beds."

Diversicare Canada manages a number of nursing homes for Counsel
and other owners in Canada and, additionally, leases five
assisted living complexes from Counsel. The proposed sale will
include all of Advocat's Canadian operations, including 13
nursing homes and 23 assisted living facilities.

Advocat Inc. operates 120 facilities including 56 assisted
living facilities with 5,245 units and 64 skilled nursing
facilities containing 7,230 licensed beds as of March 31, 2001.
The Company operates facilities in 12 states, primarily in the
Southeast, and four provinces in Canada.


ARMSTRONG WORLD: Selling Pennsylvania Property To Connectiv
-----------------------------------------------------------
Armstrong World Industries asked Judge Farnan for his authority
and approval of a proposed sale of vacant land owned by and
located in East Donegal, Lancaster County, Pennsylvania, free
and clear of all liens, claims and encumbrances, to Connectiv
Mid-Merit, Inc., a Delaware corporation, or its assignee, and to
pay a broker's commission out of the sale proceeds of 6%.

Rebecca L. Booth, Esq., at Richards, Layton & Finger PA, told
Judge Farnan that AWI owns a piece of real property consisting
of approximately 98 acres at the east end of its Marietta plant
in East Donegal, Lancaster County, Pennsylvania. AWI purchased
the property in 1973 with the original intent of expanding the
Marietta plant. In July 1998, AWI determined that it had no
future need for the property and decided to sell it. AWI
contacted Commercial Industrial Brokers, Inc. to provide
brokerage services in connection with the sale of the property.
Throughout the course of two and one-half years Commercial has
engaged in extensive marketing efforts to sell the property.
These efforts included placing a conspicuous "for sale" sign on
the property, listing the property in real estate databases such
as LoopNet, Costar and Realty IQ, mailing property brochures to
real estate brokerage firms in the Lancaster County area,
soliciting offers of interest, via mail and telephone, from
developers and potential users of the property, and discussing
sale of the property with community businesses and investors.

During this time period only one party, other than the proposed
purchaser, expressed serious interest in the property. The other
party offered the same price per acre ($34,500) as the present
contract, but only wanted to purchaser 50 of the 98 acres. This
transaction was terminated by the other party because of various
obstacles to development. AWI assured Judge Farnan that the
obstacles encountered by the other party should not be issues
for the present purchaser.

AWI and Commercial believe there is a limited market for the
property for various reasons, including that it is situated in
an industrial area and zoned for industrial use. Notwithstanding
that there has been a substantial amount of industrial property
on the market in Lancaster County, very little industrial
property has sold in recent years. The Lancaster market has been
depressed, in part because neighboring counties have
substantially better access to highways, and have promoted
industrial growth more effectively than Lancaster County.

                 The Purchase Agreement

AWI has granted the Purchaser an option to purchase the
property. The salient terms and conditions are:

      (1) Option. AWI granted the Purchaser an option to purchase
the property at any time during a 27-month period, commencing on
the Effective Date. The Effective Date is the date on which
certain contingencies are satisfied: (a) the Board of Directors
or Executive Committee of AWI approves the contract; and (b) the
Bankruptcy Court enters an order approving and authorizing AWI's
entry into and consummation of the contract.

      (2) Option Fee. Within 2 days after the Purchaser receives
notice of the occurrence of the Effective Date, it must deposit
into escrow with an escrow agent the sum of $130,000 as the
option fee. This fee is to be held in escrow and invested in
accordance with the requirements of the Bankruptcy Code, or as
otherwise required by the Court. The option fee is to be
disbursed if and when:

          (a) The Purchaser terminates the contract prior to the
end of the initial due diligence period, $10,000 of the option
fee is disbursed to AWI, and the balance of the option fee
(including accrued interest, is disbursed to the Purchaser;

          (b) The Purchaser does not terminate the contract prior
to the end of the initial due diligence period, and does not
exercise the option, the entirety of the option fee will be
disbursed to AWI unless AWI has failed to fulfill its
obligations under the contract;

          (c) The Purchaser exercises the option but the closing
does not occur, the entirety of the option fee will be disbursed
to AWI unless AWI has failed to fulfill its obligations under
the contract; and

          (d) The option is exercised and the closing occurs, the
option fee is credited toward the purchase price.

      (3) Easements. In addition to the property, the Purchaser
has the option to acquire easements from AWI for underground
pipelines, utilities, a railroad siding connection, and access
over adjacent property that AWI will retain. AWI will reserve
easements over the property for access and utilities to benefit
the adjacent property that it is retaining.

      (4) Purchase Price and Deposit. The Purchase Price for the
property is $34,500 per acre, and the Purchase Price for the
easements is $17,250 per acre. The property and the easements
will be surveyed during the initial diligence period to
determine the exact acreage. The property is approximately 98
acres, so the Purchase Price will be approximately $3,361,000,
plus the amount calculated for the easements. The purchase price
is payable as:

          (a) The Option Fee of $130,000;

          (b) $100,000 as an earnest money deposit, which is to
be paid to the Escrow Agent upon the Purchaser's exercise of the
option and applied toward the Purchase Price at closing; and

          (c) The balance to be paid by the Purchaser at closing
in cash.

      (5) Closing. The closing will take place on a date which is
30 days after the exercise of the option, or the satisfaction of
all conditions to closing, whichever is later, unless such date
is changed in writing by AWI and the Purchaser.

      (6) Initial Due Diligence. The Purchaser has the right to
examine all aspects of the property during the period commencing
on the Effective Date, and ending 6 months thereafter.

      (7) AWI Representations. AWI makes various representations
to the Purchaser, including:

          (a) AWI owns the property and easements, and has the
authority to sell the same, subject only to obtaining
subdivision approval;

          (b) The property and easements are zoned for industrial
use;

          (c) AWI will take no action to initiate or support a
change in zoning unless requested by the Purchaser;

          (d) No outstanding leases or other agreements affect
the property or easements, except a farm lease;

          (e) AWI will not alter the property or easements in any
manner that would adversely affect the Purchaser's intended use;

          (f) AWI will not sell, encumber or dispose of the
property or easements, or convey any rights to third parties,
provided AWI can sell the property, subject to the contract
under certain circumstances;

          (g) there are no pending, or to the best of AWI's
knowledge, threatened litigation, condemnation or other
proceedings affecting the property or the easements;

          (h) there are no unpaid real estate taxes or
assessments due with respect to the property or the easements;

          (i) AWI has not received any notices of existing or
alleged violations of law, ordinances, orders or requirements;

          (j) AWI has not received any notice of assessment or
violation notice affecting or requiring work on the property,
the easements or abutting streets or sidewalks;

          (k) AWI has made no commitment to any governmental
authority that would require the Purchaser to install any
improvement on the property or easements;

          (l) AWI will not suffer or permit any lien or
encumbrance (including any of an environmental protection
agency) to be placed against the property or easements unless
the same can be discharged at closing by application of the
Purchase Price or bonded;

          (m) During the initial due diligence period, AWI will
provide the Purchaser with copies of all available sampling,
analyses, environmental tests and reports in AWI's possession,
other than privileged materials, related to the property and
AWI's adjacent property;

          (n) AWI will not store, treat, process or dispose of
any regulated substance on the property or easements, except
that the farm tenant may use pesticides, herbicides and
fertilizers in compliance with law;

          (o) AWI has not released any regulated substance at,
on, about, or under the property or easements in a manner that
would require investigation, remediation or other response, or
that could reasonably be expected to result in liability, injury
or damage;

          (p) AWI has not received from any governmental
authority any written request for information, complaint, order,
assessments, demand or other notification or written claim from
any other person, that AWI is, may be, or will be potentially
responsible with respect to any investigation, remediation, or
other response related to the presence or release of regulated
substances at the property or easements;

          (q) To AWI's knowledge, AWI is not required to place
any notice or restriction relating to the presence or release of
regulated substances in the deed to the property or easements,
and neither the property nor the easements has such a notice or
restriction in its deed;

          (r) The sale of the property does not constitute 51% of
more of AWI's assets and AWI is a not a "foreign person"; and

          (s) During the term of the contract, AWI will notify
the Purchaser of any occurrence that causes any of the foregoing
to no longer be true.

      (8) Conditions to Closing. After exercise of the option,
the Purchaser's obligation to close is conditioned upon (a)
AWI's title being good, marketable and insurable; (b) the
environmental condition being satisfactory; (c) the Purchaser
obtaining all permits, licenses, subdivision and development
approval from applicable governmental authorities for the
development of a gas-fired electrical generation facility and
related ancillary facilities on the property and related
easement areas; (d) all necessary utilities being available to
the property; (e) AWI's representations being true and correct;
(f) no material adverse change having occurred to the property
or easements, and AWI having performed all its obligations under
the contract; and (g) all governmental approvals to subdivide
the property and easements has been obtained.

      (9) Costs; Prorations. AWI and the Purchaser will split any
transfer tax stamps. The Purchaser will pay for its title
insurance and the survey work. Assessments and taxes, as well as
utilities and other customarily prorated expense, will be
prorated as of the Closing. The Purchaser will pay for the
preparation of the deed and AWI will pay the commission to the
broker. Each party pays its own attorney's fees.

     (10) Title/Survey Approval. The Purchaser will obtain a
commitment for title insurance and a survey of the property
within 45 days of the Effective Date. The Purchaser will have 45
days from the receipt of the commitment and survey to object to
any items disclosed. If the Purchaser gives timely notice of its
objection, AWI will be entitled, but not obligated to agree to
cure the same. AWI will advise the Purchaser whether it will
seek to cure within 30 days. If AWI is unwilling or unable to
cure any objection, the Purchaser will, within 30 days of notice
of such unwillingness or inability, have the right to either (a)
terminate the contract, in which case the option fee will be
refunded to the Purchaser, and neither party will have any
further rights or obligations under the contract, or (b) waive
the unsatisfied objection and proceed to closing.

     (11) Environmental Insurance. The Purchaser has applied for
environmental insurance for a policy term of 5 years, with
coverage of up to $5,000,000 for each incident, $10,000,000 in
the aggregate, and a deductible of $100,000. In the event the
Purchaser purchases this coverage, it will name AWI and AWI's
affiliates, successors and assigns as additional insureds, and
at closing the Purchaser will receive credit against the
Purchase Price of 50% of the premium up to $60,550.

     (12) Assignment. The rights and obligations of the Purchaser
under the contract may be assigned by the Purchaser by one or
more successive assignments, either before or after the exercise
of the option, without the prior written consent of AWI to (a)
any affiliate of the Purchaser; or (b) to one or more lenders,
financial institutions, or other entities providing financing of
the contemplated project (including a sale/leaseback
arrangement). Such an assignment without the consent of AWI will
not relieve the Purchaser of its obligations under the Contract.

The Purchaser may designate a nominee to take title to the
property and easements at closing. After closing, the designated
nominee will assume all rights and obligations under the
contract, but the Purchaser will not be relieved of its
obligations under the contract. If the assignee or nominee
provides to AWI reasonable assurance of its financial capacity,
ability, understanding and commitment to assume and comply with
the terms of the contract that survive closing, AWI agrees to
approve the transfer and to relieve the Purchaser of its
obligations under the contract.

     (13) Broker's Fee. Upon closing, AWI will pay the broker its
commission in the amount of 6% of the Purchase Price. The broker
is required to remit 20% of the commission to Armstrong Realty
Group, a subsidiary of AWI, as a referral fee.

            The Debtor's Sound Business Judgment

The Debtor agrees it is required to show that (i) a sound
business reason justifies this sale, (ii) the sale has been
proposed in good faith, (iii) the sale price is fair and
reasonable, and (iv) adequate and reasonable notice of the sale
has been given. In this case, AWI submits that adequate business
justification exists which merits judicial approval of the
proposed sale to the Purchaser. First, the contract represents
substantial value to AWI's estate in that it provides for
favorable terms for the sale of an asset that is not necessary
for AWI's reorganization. The property was acquired almost 20
years ago for future plant expansion. Almost 3 years asgo, AWI
determined that the property would not be so utilized and began
efforts to sell it. The property is "non-core" to AWI's business
and should be sold to provide additional funds for AWI's
reorganization.

As a result of the broker's extensive marketing efforts, the
contract represents the highest and best offer that AWI has
received to date. The contract also represents the end product
of good faith and arm's length negotiations between the parties.
AWI believes the Purchaser is creditworthy and possesses the
financial resources to close the transactions contemplated by
the Court.

                     Selling Free and Clear

In the instant case AWI told Judge Farnan that it owns the
property to be sold free of any financing liens or mortgages. To
the extent that any tax or other statutory lien, if any, may be
asserted against the property, since the property is being sold
at fair market value the holders of any such liens can be
compelled to accept money in satisfaction of the same. Any
liens, claims or encumbrances are to attach to the proceeds of
the sale; the Debtors therefore argue that the property can be
sold free and clear of all liens, claims and encumbrances,
except for exceptions permitted in the contract.

                      Higher and Better Offers

The Purchaser is cognizant of AWI's fiduciary duty to maximize
proceeds from the sale of assets for the benefit of these
estates and creditors. In that regard, AWI proposed to sell the
property to the Purchaser under the terms of the agreement, but
subject to any higher or better offers received by AWI on or
before the deadline for receiving objections to this Motion.

The property has been the subject of intensive marketing efforts
and the Debtor submitted that, for the purpose of soliciting
competing offers, the property need not be subject to additional
marketing attempts. Instead, AWI believes it is sufficient to
provide noticed of the proposed sale to all parties in interest
in these chapter 11 cases, including the party that previously
negotiated with AWI to purchase a portion of the property. If a
competing offer is received that AWI determines, in the exercise
of its reasonable business judgment, is higher or better than
the officer reflected by the agreement, AWI reserves the right
to seek approval to enter into the transaction reflected in the
competing offer during the hearing on this Motion.

                  Payment of the Broker's Fee

Although the agreement provides for payment of the commission to
the broker, and accordingly approval of the payment is implicit
in the approval of the contract, out of an abundance of caution
AWI asked Judge Farnan to approve payment of the sales
commission from the proceeds of the property. AWI said the
brokers' efforts were integral to effectuating the agreement.
Accordingly it would be inequitable for AWI to reap the benefits
of the sale without compensating the broker for its services in
connection with the sale. Therefore, payment of the broker's fee
is justified.

                 Exemption from Transfer Taxes

The exemption from stamp or similar taxes under the Bankruptcy
Code has been broadly construed by bankruptcy courts to include
asset sales and transfers prior to confirmation of a plan.
Preconfirmation sales or transfers of assets may be exempt from
state and local transfer taxes if done in contemplation of a
plan or in order to facilitate the proposal and confirmation of
a plan. The sale of the property is, the Debtors assured Judge
Farnan, part of AWI's overall business plan, and this plan
serves as the foundation for formulation of a chapter 11 plan
of reorganization. Selling the property prior to confirmation
reduces the cost to AWI in maintaining the property. The savings
will benefit AWI's estate and its creditors, and will facilitate
the successful reorganization. AWI therefore submits that the
sale of the property should be exempt from stamp or similar
taxes, including real property taxes. (Armstrong Bankruptcy
News, Issue No. 7; Bankruptcy Creditors' Service, Inc., 609/392-
0900)


AVATEX: Reviewing Alternatives To Continue as A Going Concern
-------------------------------------------------------------
Avatex Corporation is a holding company that, along with its
subsidiaries, owns interests in other corporations and
partnerships. Through Phar-Mor, its 47%-owned affiliate, it is
involved in operating a chain of discount retail drugstores.
Through Phar-Mor and CLAC, Avatex owns approximately 38%, and
control 50%, of the membership interests of Chemlink. Chemlink
is primarily engaged in the development, manufacture and
distribution of effervescent tablet and granule formulations for
consumers and businesses for use in cleaning, disinfecting and
sterilization applications.

Equity in income (loss) decreased $15,568 to a loss of $16,311
for the year ended March 31, 2001 compared to an equity in loss
of $743 for the year ended March 31, 2000. The change in equity
income (loss) of affiliates was primarily the result of $15,402
in increased losses at Phar-Mor that was due to declines in
operating income and investment results when compared to the
prior year. The Company's equity in investment income earned by
Phar-Mor for the year ended March 31, 2001 was $10,494 less than
in the prior fiscal year while its equity in operating income
was $4,908 less than in the prior year. Investment results were
lower principally due to write-downs related to technology
investments, primarily for on-line stores, while operating
results decreased due to lower sales revenue, higher interest
expense and lower profit margins than in the prior year. The
remainder of the $166 increase in Avatex' equity loss in the
current year was primarily a result of its equity in Cyclone's
results.

As of March 31, 2001, Avatex had cash and short-term investments
of approximately $13,666. During the year ended March 31, 2001,
it purchased preferred stock of RAS for $1,011, invested $150
for a 41.5% interest in a new limited liability company that
acquired the rights to the "Cyclone Fence" name, made an
additional investment in CLAC of $205, invested approximately
$81 in HPD and purchased $1,229 in Phar-Mor common stock raising
our ownership from 38.4% to 47.1%.

Company debt consists of the 6.75% notes issued by Avatex
Funding in connection with Avatex' merger with Xetava. Based on
the 6.75% notes outstanding at March 31, 2001, semi-annual cash
interest payments are approximately $878, and the remaining
principal balance of approximately $26,025 is due in December
2002. Since the Company has guaranteed the 6.75% notes and
Avatex Funding has no assets other than the Phar-Mor common
stock securing the notes, made and may make additional capital
contributions to Avatex Funding so it can satisfy its interest
and principal obligations on the notes. In April 2001, Avatex
purchased $11,744 face amount of the 6.75% notes for $7,055.
This purchase reduced the outstanding balance on the 6.75% notes
to approximately $14,281 and resulted in an extraordinary gain
on the early extinguishment of debt of $2,476 in the first
quarter of fiscal 2002. This will also reduce Company semi-
annual interest payments by $396. At the same time Avatex
purchased the 6.75% notes in April 2001, two of its pension
plans also purchased a total of $5,256 face amount of the 6.75%
notes for $3,154.

For corporate operations, cash requirements include the funding
of monthly operating activities, the payment of benefit
obligations, and the funding of environmental liabilities of
previously owned businesses. The amounts and timing of the cash
requirements for environmental liabilities are uncertain. Avatex
will likely be required to fund any cash to be paid by Avatex
Funding to its note holders. The Company expects to receive cash
from the collection of receivables, the sale of its investment
in HPD, and from interest and dividend income earned on its
investments. The Company continuously evaluates current and
potential investments in connection with an ongoing review of
its investment strategies and, as opportunities arise, may
continue to invest in publicly and privately held companies.

Avatex will rely on cash on hand, any excess cash from
investments and, if necessary, the sale of its investments to
meet future obligations. The Company is involved in litigation
which, if it were to lose, would have a material impact on its
financial condition, liquidity and results of operations.
The Company believes that in future the remaining issues
affecting its status as a going concern involve:

      - overcoming operating losses and providing cash for debt
repayments and for future growth; and

      - favorably resolving potential liabilities associated with
pending litigation.

Until these issues can be resolved, there is substantial doubt
as to Avatex' ability to continue as a going concern. In order
to overcome these remaining issues, it is taking the following
steps:

      - continuing to review the investment portfolio in order to
identify those investments which should be liquidated and those
which merit new or additional investment which will generate
earnings and/or cash for Avatex in the future; and

      - continuing its vigorous defense of remaining litigation
and pursue its lawsuit against McKesson.

The Company's primary market risk is in the fluctuation in the
fair or market value of its available for sale securities. These
are primarily long-term investments whose ultimate value depends
on the success of the investee in developing and selling its
products or technologies. Therefore, the change in the value of
these securities due to changes in current interest rates is not
considered material. The Company also holds short-term cash
investments which are subject to interest rate risk. Because of
the very short-term nature of these investments, the risk to the
fair value of these investments is not considered material
although there is cash flow exposure if rates significantly
change.


DRUG EMPORIUM: U.S. Trustee Kicks Four Members from Committee
-------------------------------------------------------------
In the Drug Emporium, Chapter 11 Case, F&D Reports relates, the
US Trustee has made official the removal from the Committee of
four members, reducing the membership to five. The companies
dropped from the Committee had made deals with the Company to
extend credit on favorable terms in exchange for a guaranteed
payment of a fixed percentage of their respective prepetition
claims, F&D learned.


EDISON INTERNATIONAL: Fitch Gives Comments On Ratings
-----------------------------------------------------
In response to investor inquiries, Fitch provided the following
comments on the credit implications for Edison International
(EIX) and Southern California Edison Co. (SCE) of a proposed
reduction of debt at EIX.

Edison International (EIX) has formed a subsidiary, Mission
Energy Holding Co. that is expected to offer $1.2 billion of
senior secured notes to qualified investors pursuant to SEC rule
144A. The notes will be secured with 100% of the stock of Edison
Mission Energy and an interest reserve fund. Proceeds of the
offering are to be paid as a dividend to Mission Energy
Holding's direct parent, The Mission Group, and then will be
lent to Mission Group's parent EIX. EIX intends to use the
proceeds to repay all EIX debt maturing in 2001.

The EIX issues to be retired include $618 million outstanding
loans under a bank revolving credit facility that expires on
June 30. The bank agreement includes a provision that would
trigger default upon the occurrence of an event of bankruptcy of
Southern California Edison Co. No other debt of EIX contains a
similar provision. Other debt expected to be retired with the
funds are senior notes due July 18 ($250 million) and Nov. 1
($350 million). As a result of these retirements, EIX's
remaining outstanding debt would be substantially reduced, cash
needs at EIX for interest and principal payments would be
minimal for several years, and the risk of cross default if SCE
files a bankruptcy petition would be eliminated. Remaining EIX
obligations would be $750 million of senior notes due in 2004
and quarterly trust preferred securities (subject to their
terms, quarterly dividends have been deferred and additional
dividends may be deferred for more than four years).

Upon successful completion of the debt issuance and reduction of
EIX debt, Fitch expects that the credit rating of remaining
senior debt of EIX will be raised from `CC' to `CCC'. Ratings
are unlikely to advance above the `C' range unless the State of
California works out a means to improve the solvency of SCE and
avoid bankruptcy. Favorably, SCE reports that it has made
progress in the past week on negotiating contracts that will
resolve disputes on defaulted payments owed to qualifying
facility (QF) power generators. Also, the California Public
Utility Commission last Thursday enacted three orders that are
modest stepping stones on the path to a solution. On the other
hand, there does not appear to be sufficient support in the
California legislature at this time to carry out the Governor's
memorandum of understanding. Ratings of EIX remain on Rating
Watch Negative, reflecting the continuing risk of bankruptcy of
SCE.

Currently, SCE is insolvent and has defaulted on over $900
million of debt obligations as well as payments to QF
generators. Its ability to remain out of bankruptcy depends on
its creditors' forbearance. Completion of the transactions above
could be viewed as slightly increasing the likelihood of a
bankruptcy petition by SCE, but management has simultaneously
invested considerable effort to work out a solution that avoids
bankruptcy. It is fair to say that the situation remains dire.
Ratings of SCE's securities currently reflect default or
imminent default and remain on Rating Watch Negative.

Fitch will review and revise ratings of EIX and SCE upon the
completion of the transactions described above. Fitch does not
rate the debt of Edison Mission Energy or Mission Energy Holding
Co.


EDISON: Trans-Elect To Offer $1.8B For SCE's Transmission Lines
---------------------------------------------------------------
Trans-Elect, a two-year-old private company headquartered in
Washington, D.C., will offer $1.8 billion - far less than
California's offer of $2.76 billion - next week, Trans-Elect
executive vice president Robert Mitchell told Dow Jones
Newswires. Mitchell said he will send a letter Wednesday to
Edison Chairman and Chief Executive John Bryson to buy the
company's 12,000 miles of high-voltage transmission lines.

Trans-Elect hopes to acquire a vast network of lines across the
United States. California reached an agreement with Southern
California Edison (SCE) on April 6 to buy its transmission lines
for $2.76 billion, or 2.3 times over book value. Under that
memorandum of understanding (MOU), the state would also allow
the utility to issue bonds to recover $3.5 billion in
uncollected power costs. Lawmakers have until Aug. 15 to pass
legislation implementing the MOU. The first hearing on the deal
is scheduled for Tuesday. (ABI World, June 18, 2001)


FINOVA GROUP: Stipulation With First Union re Employee Motion
-------------------------------------------------------------
To address reservations and concerns of First Union National
Bank in connection with The FINOVA Group, Inc.'s Motion for the
Implementation of Retention Plans And Compensation Agreements
And Approving The Debtors' Disclaimer Of All Interest In Certain
Funds Escrowed Prepetition (the "Employee Motion"), First Union
and the Debtors stipulated and agreed that:

      (1) The granting of the Employee Motion will not affect or
alter any rights of First Union to claim an express trust,
resulting trust, or constructive trust with respect to funds
allegedly received from Finova Mezzanine Capital, Inc. ("FMC")
from M2Direct, Inc.;

      (2) The granting of the Employee Motion shall be without
prejudice to any rights or claims asserted by First Union in its
adversary proceeding entitled First Union National Bank v.
Finova Mezzanine Capital. Inc., Adv. No 01-1067, and the Debtors
shall make no argument that the granting of this Employee Motion
somehow altered or affected the rights of First Union. Instead,
the granting of the Employee Motion shall be without effect on
the present status quo between First Union and the Debtors.

      (3) The source of the funds escrowed prepetition with
Security Title Agency, Inc., representing payments due to six
terminated executives, as described in the Employee Motion, was
not FMC but rather was The FINOVA Group Inc. and FIENOVA Capital
Corporation. (Finova Bankruptcy News, Issue No. 9; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


HARNISCHFEGER: Will Hold Post-Chapter 11 Presentation On June 25
----------------------------------------------------------------
Harnischfeger Industries, Inc. (OTC Bulletin Board: HFIIV)
announced that John Nils Hanson, Chairman, President and CEO,
and Kenneth A. Hiltz, Chief Financial Officer, will discuss the
Company's reorganization, performance, strategy and outlook at
the Company's first investor presentation following the
successful confirmation of its plan of reorganization. The
presentation will take place Monday, June 25, 2001 in New York.

Attendance is by reservation and interested parties can listen
to the presentation by dialing 800-810-0924 in the United States
or 913-981-4900 outside of the United States, access code
#730457, at least 15 minutes prior to the 12:30 PM EDT start
time. The accompanying slides to the presentation are expected
to be available on the Company's web site on the afternoon of
June 25, 2001. A rebroadcast of the meeting will be available
for two weeks by dialing 888-203-1112 or 719-457-0820, access
code #730457.

As previously announced, the Company's plan of reorganization
was confirmed on May 18, 2001, clearing the way for the Company
to emerge from bankruptcy as soon as its exit financing is
complete. Confirmation of the plan of reorganization was the
final court approval required for the Company's emergence from
Chapter 11.

Harnischfeger Industries Inc. is a worldwide leader in
manufacturing, servicing and distributing equipment for surface
mining through its P&H Mining Equipment division and underground
mining through its Joy Mining Machinery division.


HIH INSURANCE: Liquidator Obtains Injunction Against Creditors
--------------------------------------------------------------
KPMG, the provisional liquidator of HIH Insurance Ltd., received
a temporary restraining order in the U.S. Bankruptcy Court to
prevent creditors from taking parts of the collapsed company's
assets, according to Dow Jones. "We have been granted a
temporary restraining order and a preliminary injunction in the
U.S. Bankruptcy Court," KPMG's Tony McGrath said. The injunction
will ensure "the efficient administration of assets held by
companies in the HIH Group in the United States and will prevent
a 'piecemeal grab' of the assets of those companies by those
creditors," he said. HIH, which was Australia's second-largest
general insurer, collapsed in mid-March, just ahead of its plan
to detail a first half loss of 800 million Australian dollars
(US$419.6 million). In May, McGrath said that early estimates
for the total deficiency of the HIH Group of companies would be
between $2.7 billion(A) and $4 billion(A). The HIH group covers
about 200 companies located in the United States, Hong Kong, New
Zealand, the United Kingdom and Australia. (ABI World, June 18,
2001)


HOLLYWOOD FUNDING: S&P Cuts Note Rating To D After Default
----------------------------------------------------------
Standard & Poor's lowered its rating on Hollywood Funding No. 6
Ltd.'s $100.7 million notes to 'D' from triple-'C'-minus.
The rating action is the result of Hollywood Funding No. 6's
failure to make its final principal payment to investors on June
18, 2001, and Lexington Insurance Co.'s denial of payment of the
claim under the insurance policy that was put in place to
provide sufficient funds to pay the notes.

Standard & Poor's originally assigned a triple-'A' rating to the
Hollywood Funding No. 6 notes, on a confidential basis, due to
its reliance on the terms of an insurance policy issued by
Lexington, a wholly owned subsidiary of American International
Group, Inc.

The notes were downgraded to triple-'C'-minus from triple-'A' on
Feb. 2, 2001, reflecting Standard & Poor's understanding that
Lexington had notified the trustee for the noteholders that it
would not pay on a claim made under the Hollywood Funding No. 6
insurance policies, pending an investigation.


INDEPENDENT INSURANCE: Fitch Slashes Rating to DD From B
--------------------------------------------------------
Fitch, the international rating agency, has downgraded the
Insurer Financial Strength (IFS) rating of Independent Insurance
Company Limited (Independent) to 'DD' from 'B'.

The rating action follows the company's announcement that
provisional liquidators have been appointed, recognising the
potential insolvency of the company. The provisional
liquidators, PricewaterhouseCoopers, are currently assessing the
liabilities of the company, which Fitch anticipates are greater
than the total assets of the Independent. The agency believes
that creditors are likely to vote for a scheme of arrangement,
which will provide the most efficient route to partial payment
of outstanding liabilities. Fitch estimates that ultimate
payments to creditors in a liquidation will be in the range of
50-90%.


INDEPENDENT INSURANCE: AM Best Further Cuts Rating To F From B-
---------------------------------------------------------------
A.M. Best Co. has downgraded the rating of Independent Insurance
Company Ltd to F (In Liquidation) from B- (Fair) with developing
implications.

The downgrade follows the court application by Independent
Insurance Group to be placed in administration and the
appointment of PricewaterhouseCoopers (PwC) as provisional
liquidators.

PwC is reviewing the financial position of the company and will
be seeking to arrange a scheme that will enable the settlement
of claims to policyholders. It is also seeking buyers for parts
of the business that are still viable.

A.M. Best Co., established in 1899, is the world's oldest and
most authoritative insurance rating and information source. For
more information, visit A.M. Best's Web site at www.ambest.com.


LECHTERS: Next Status Conference Scheduled for September 11
-----------------------------------------------------------
In the Lechters Chapter 11 Case, F&D Reports relates, the US
Bankruptcy Court in New York City gave final approval for the
$86.0 million DIP Facility being provided by Fleet Financial and
the additional $12.5 million facility being provided by Back
Bay. All of the objections to the DIP Facility agreement raised
by Committee were resolved prior to the hearing. The Bankruptcy
Judge supervising the Company's reorganization also held a brief
"status conference," a procedure utilized by some of the Judges
in New York (and elsewhere) to familiarize themselves with
various ongoing issues in a Chapter 11 Case. The one First Day
Order that had been deferred, which authorized the payment of
prepetition sales and use taxes, was signed upon advice that the
Committee had no objection. The next status conference in the
Lechters case has been scheduled for September 11 at 11 am,
F&D's review of the Court's docket shows. The first meeting of
creditors pursuant to Section 341 of the Bankruptcy Code in this
case is scheduled for July 16 at 2:00 pm, at the Office of the
United States Trustee in NYC. One of the bondholders appointed
to the Committee has tendered its resignation and it appears
that the US Trustee will replace it with Chase Manhattan Bank as
Indentured Trustee, keeping the Committee at 7 members.


LIVING.COM: Big Lots Buys Bankrupt Internet Retailer's Inventory
----------------------------------------------------------------
Big Lots, the nation's leading broadline closeout retailer, has
purchased the inventory of bankrupt Internet home furnishings
giant Living.com.

"Living.com was one of the premier retailers for high quality,
name brand furniture online," said Michael Potter, chairman and
CEO at Big Lots.  "The opportunity to make this inventory
available through our stores helps enlighten customers about the
variety of merchandise and extreme savings Big Lots offers."

As pure player Internet companies like Living.com struggled to
build a company, a brand, and a fulfillment strategy at the same
time, there simply weren't enough customers to support the tasks
at hand.  Big Lots owns 70 percent of the buy-side of closeout
retailing, making them an appealing option for manufacturers
looking for a one-stop solution to their excess inventory needs.

"Our customers find these types of great deals unique and
exciting," Potter noted.  "With our new brand and strategic
initiatives underway, we believe customers will grow to
recognize the value, fun, and rewards of closeout shopping."

Living.com, which was highly touted as the "gold standard" for
online furniture and home furnishings, went from startup stardom
in 1998 to declaring bankruptcy in 2000.  The company's
inventory was recently made available for purchase.  Furniture
from name brand manufacturers including Broyhill, Century,
Thomasville, Lane, Natuzzi, Vaughah, Bernhardt, and others, are
part of the merchandise mix purchased by Big Lots.

The original retail value of this deal is estimated at $2
million.  Big Lots will retail this inventory at 50 to 80
percent off the original retail prices.  "While this deal is not
large enough to have a material impact on our results, it is
reflective of the types of unique product and shocking values we
are aggressively pursuing for our customers," Potter added.

This is the second Internet buyout of furniture and home
furnishings for the nation's largest broadline closeout
retailer.  Last March, Big Lots purchased inventory from
furniture.com -- another e-tailer angling for business from the
boom of the dot.com industry.  The inventory, distributed
through Big Lots stores at deep discounted prices, was a hit
with consumers and rapidly sold out.

Living.com's inventory, including bedroom, dining room, living-
room furnishings and more, will be made available at the Big
Lots stores in Central Ohio with an estimated sell through time
of two weeks.

To speak with a Big Lots representative, contact Keri Lucas at
614-278-7023.

Big Lots, Inc. (http://www.biglots.com)is the nation's largest
broadline closeout retailer with annual revenues exceeding $3
billion.  Headquartered in Columbus, Ohio, Big Lots operates
more than 1,300 retail stores serving 46 states.  Four regional
distribution centers throughout the country, ranging in size
from 1 million to 3 million square feet, provide the company's
stores with brand name products from more than 3,000
manufacturers.  Big Lots offers merchandise at 20 to 40 percent
below most discount retailers and up to 70 percent below
conventional retailers.  Founded in 1967, the company employs
more than 40,000 associates across the U.S.  By creating
excitement with brand name closeouts and bargains through a
unique shopping experience, Big Lots meets the needs of
customers by providing an assortment of merchandise including
consumables, seasonal products, furniture, housewares, toys, and
gifts.  Big Lots is currently traded on the New York Stock
Exchange under the symbol BLI.


LOEHMANN'S HOLDINGS: Annual Stockholders' Meeting Is On July 23
---------------------------------------------------------------
The Annual Meeting of the Stockholders of Loehmann's Holdings,
Inc., a Delaware corporation, will be held at the offices of the
Company at 10:00 a.m., July 23, 2001 to consider and vote
on the following:

      (1) The election of seven (7) directors to serve on the
Company's Board of Directors until the next annual meeting of
stockholders and until the election and qualification of their
respective successors;

      (2) The amendment of the Company's Amended and Restated
Certificate of Incorporation to authorize the issuance of
Preferred Stock.

      (3) The adoption of the Company's 2001 Stock Option Plan.

      (4) The ratification of the appointment of Ernst & Young
LLP as the Company's independent accountants for the fiscal year
ending February 2, 2002;

      (5) The transaction of such other business as may properly
come before the meeting or any adjournments thereof.

Only stockholders of record on the close of business on June 18,
2001 are entitled to notice of and to vote at the Annual
Meeting.


LTV CORPORATION: Modifies Nonunion Employee Severance Benefits
--------------------------------------------------------------
The LTV Corporation asked Judge Bodoh for authority, in their
sole discretion, to provide modified severance benefits to
certain nonunion salaried employees of LTV Steel Mining Company.
The Debtors reminded Judge Bodoh that Steel Mining, a wholly-
owned indirect subsidiary of LTV Steel, has its principal place
of business in Hoyt Lakes, Minnesota. As of the Petition Date,
Steel Mining employed approximately 1,400 people, 147 of whom
were nonunion salaried employees, and was the largest employer
in Hoyt Lakes. As a result of the precipitous decline in steel
prices and the softening of the market for steel products during
the second half of 2000, the Debtors, having already decided to
close Steel Mining, advanced the proposed closure date to
February 2001. Prior to the Petition Date, Steel Mining issued
notices under the Worker Adjustment and Retraining Notification
Act to (a) 71 employees informing them that their termination
date would be February 22, 2001, and (b) 6 employees informing
them their termination date would be March 31, 2001.

After the Petition Date the Debtors re-examined their shutdown
plans for Steel Mining and determined that immediate financial
constrains dictated that operations at Steel Mining could not be
sustained until February 2001. Accordingly, Steel Mining ceased
production on January 6, 2001, and began the wind-down of its
business operations. Two additional employees have received WARN
notices for March 31, 2001, and it is anticipated that up to ten
additional employees may receive WARN notices identifying later
termination dates.

In connection with the announcement of the anticipated closure
of Steel Mining in May 2000, LTV Steel announced certain
enhancements to its existing severance plan for salaried
employees to provide an incentive for employees to remain with
Steel Mining for as long as Steel Mining required their services
in connection with the wind-down of its operations, and to ease
the burden of the closure on the employees, most of whom likely
will have to relocate to find comparable employment. The
severance program was intended to cover 147 employees who
continued, or are continuing, to work for Steel Mining until the
termination of their employment due to the closure.

The primary components of the Severance Program are:

      (a) Basic Severance Pay: All employees, regardless of age
or time of service, would receive six months of base and
supplemental salary payable in bi-weekly installments, for a
six-month period. With one exception, the Basic Severance Pay
would be offset by earnings from another employer and by
unemployment compensation.

      (b) Employee Health Insurance: All employee health
insurance would continue to be provided through the earlier of
(i) six months following the employee's termination date, or (b)
the date on which the employee becomes eligible for benefits
provided by another employer.

      (c) Direct Contribution to Retirement Plan: Steel Mining
would continue to make direct contributions on behalf of each
employee to the LTV Steel Retirement Plan for six months after
the employee's termination date. An employee who is otherwise
eligible to do so may elect to receive a distribution from the
employee's retirement plan account upon the cessation of Basic
Severance Pay.

      (d) 70/80 Pension Supplement: Each employee who has at
least 15 years of service and either (a) is at least age 55, or
(b) has age and years of service that equal or exceed 80 years
as of the time of the cessation of the employee's Basic
Severance Pay would receive (i) an immediate pension benefit
form the LTV Steel Mining Company Pension Plan, and (ii) a $400
monthly supplement until age 62.

      (e) Rule of 65 Pension Supplement: Each employee who has
(a) at least 20 years of service, and (b) years of age and
service that equal or exceed 65, but are less than 80, as of the
time of the cessation of the employee's Basic Severance Pay,
would (i) receive an immediate pension benefit from the Pension
Plan, and (ii) a $400 monthly supplement until age 62. The Rule
of 65 Pension Supplement would be reduced $1 for each $2 of
income earned by the employee after retirement that exceeds
$17,000 in a calendar year.

      (f) Retiree Medical Coverage: Employees who are eligible
for benefits from the Pension Plan at the time of the cessation
of the employee's Basic Severance Pay would be eligible to
receive LTV Steel's standard retiree medical coverage and would
receive 100% of LTV Steel's contribution toward the cost of such
coverage. The Debtors estimate that their liability for retiree
medical coverage would increase as a result of early retirements
due to the closing of Steel Mining.

In addition to the Basic Severance Benefits, as part of the
Severance Program, LTV Steel agreed to provide additional
severance benefits to 27 key employees with specialized skills
and knowledge of the equipment and operations of Steel Mining.
This was offered through retention letters and letter
agreements. These fall into four general categories:

      (1) Two employees would receive Supplemental Severance
Benefits consisting of: (a) six additional months of Basic
Severance Pay that is not subject to offset, payable in six
monthly installments after the cessation of Basic Severance Pay,
and (b) six months of outplacement services with a professional
outplacement company.

      (2) Thirteen employees would receive Supplemental Severance
Benefits consisting of (a) a lump sum payment ranging from
$22,000 to $48,000, and (b) six months of outplacement services
with a professional outplacement company.

      (3) Seven employees who work at a power plant owned by
Steel Mining would receive Supplemental Severance Benefits
consisting of: (a) a lump sum payment ranging from $30,000 to
$41,000; (b) six months of outplacement services with a
professional outplacement company; and (c) a special severance
payment equal to 130% of the employee's last annual base salary
at Steel Mining, payable in six monthly installments, if the
employee becomes an employee of the new owner of the power plant
and the power plant remains in operation under new ownership,
and if the employee is terminated without cause by the new owner
within one year of the closing date.

      (4) Five employees who are or will become employees of
Cleveland-Cliffs Inc. would receive a Supplemental Severance
Benefit consisting of a lump sum payment ranging from $27,000 to
$38,000.

The Debtors estimate that the total cost of honoring their
obligations under the Severance Program would be approximately
$7.2 million.

Given their current financial constrains and their duty to
preserve their assets for the benefit of their estates and
creditors, the Debtors currently are evaluating all of their
existing severance programs in connection with their
implementation of a key employee retention and severance
program. To protect WARN employees from the precipitous loss of
all pay and benefits while new severance programs are
implemented, the Debtors sought Judge Bodoh's authority to
provide limited severance benefits to the WARN employees of:

      (a) two months of Basic Severance Pay;

      (b) two months of health insurance; and

      (c) two months of direct contributions to the Retirement
Plan for each WARN employee.

The estimated aggregate cost to provide these modified severance
benefits to the WARM employees will be (a) approximately
$775,000 for employees who have received WARN notices to date,
and (b) as much as approximately $114,000 for up to ten
additional employees who may receive WARN notices through the
date of the disposition of this Motion.

While the Debtors recognize that the WARN employees have relied
upon the existence of the Severance Program for the past several
months, the Debtors say that without the modified severance
benefits, which represent a substantial reduction from the
overall benefits established under the Severance Program, the
WARN employees could find themselves unemployed and with rapidly
dwindling means to support themselves and their families. The
Modified Severance Benefits provide the WARN employees with a
minimal safety net as they begin their search for other
employment.

               Response of the Unsecured Committee

The Official Committee of Unsecured Creditors believes that the
Debtors' proposal to pay modified severance benefits to the WARN
employees is reasonable in light of all of the circumstances
presented in the Motion. The Committee said it is willing to
consent to the payment of severance benefits only in accordance
with the Motion on condition that such payment does not
establish a precedent governing any future requests for
authority to pay severance benefits.

                        Judge Bodoh Rules

Judge Bodoh deemed the Creditors' Committee's response resolved,
and granted the Motion, authorizing the Debtors, in their sole
discretion, to provide modified severance benefits to the WARN
employees. (LTV Bankruptcy News, Issue No. 10; Bankruptcy
Creditors' Service, Inc., 609/392-00900)


LTV CORP.: Says Banks Will Help With $250 Mil Loan Application
--------------------------------------------------------------
LTV Corp. said National City Bank and KeyBank N.A. have agreed
to assist it in preparing an application for a federal guarantee
of a new $250 million loan that they might provide to the ailing
company, according to Dow Jones. Judge William T. Bodoh of the
U.S. Bankruptcy Court in Youngstown, Ohio, on June 5 authorized
the company to enter an expense reimburse agreement with the two
potential lenders in connection with their preparation of an
application under the Emergency Steel Guaranteed Loan Program,
reported Dow Jones. No objections to the matter were raised,
according to Judge Bodoh's order. The loan guarantee program
provides financial assistance to steel companies that have
suffered job, financial or production losses by guaranteeing up
to 85 percent of loans - up to a $250 million loan amount - made
to qualifying steel companies by private lenders. (ABI World,
June 18, 2001)


METAL MANAGEMENT: Set To Emerge From Chapter 11 Before Month-End
----------------------------------------------------------------
Metal Management, Inc. received court approval for its plan of
reorganization from the United States Bankruptcy Court for the
District of Delaware. The plan provides for the company's
emergence from Chapter 11 on or before June 29, 2001. According
to Metal Management, the plan of reorganization received the
overwhelming support of all of its creditor constituencies,
including some 90% of the general unsecured creditors voting on
the plan.

Upon effectiveness of the plan, Metal Management will have a new
board of directors comprised of Albert A. Cozzi, the company's
Chairman and Chief Executive Officer, John T. DiLaqua, Harold
"Skip" Rouster, Kevin P. McGuiness, and Daniel Dienst. Messrs.
DiLaqua, Rouster, and McGuiness are scrap metal industry
veterans, having spent decades with industry giants, Philips
Servcies/Luria Brothers, The David J. Joseph Company and
Simsmetal Australia, respectively. Mr. Dienst is a managing
director of CIBC World Markets, a financial services firm with
global business operations.

In accordance with the plan of reorganization, approximately
$215 million of indebtedness will be converted into common stock
of reorganized Metal Management, and approximately $4 million of
other prepetition debt of the company will be paid out at a
discount over time. The debt service obligation of the company,
as a result of the restructuring, will be reduced by
approximately $18 million annually. Existing shareholders of
Metal Management will receive on a pro rata basis 100,000 shares
of the new common stock.

Albert A. Cozzi remarked, "I am extremely pleased that Metal
Management is emerging from Chapter 11 before the end of this
month. The support for the plan of reorganization from our
senior lenders, bondholders and unsecured creditors has been
overwhelming. The deleveraging of our capital structure that
will result from the implementation of the plan will allow Metal
Management to continue to build on the base of business that we
were able to maintain intact during the bankruptcy."

Mr. Cozzi continued, "The loyalty, dedication and hard work of
our employees has enabled us to weather this storm and come out
with one of the strongest balance sheets in the industry. We
appreciate the confidence that our scrap metal suppliers have
shown in us, which has allowed us to maintain our market share.
I also look forward to working with our new board members, each
of whom brings divergent talents and experiences to our
company."

               About Metal Management, Inc.

Metal Management is one of the largest full service metals
recyclers in the United States, with over 40 recycling
facilities in 14 states and estimated annual revenues of
approximately $800 million.


MIDLAND FOOD: Prevails in Contest over Use of Cash Collateral
-------------------------------------------------------------
In the Midland Food Chapter 11 Case, after a lengthy hearing,
the Bankruptcy Court approved the Company's Motion to use Cash
Collateral over the objection of Bayview FMAC, and in doing so,
denied Bayview FMAC's request for monthly adequate protection
payments, according to a report circulated by F&D Reports this
week. The Court also approved the Company's request to assume
the Pizza Hut Franchise Agreements (also over the objection of
Bayview FMAC), F&D relates. In addition, for a "clean sweep,"
the Court denied Bayview's motion to terminate the exclusive
periods for the Company to file its Plan of Reorganization and
then solicit acceptances. Two other Motions of Bayview were
adjourned one seeks the appointment of an examiner and the other
seeks further depositions. The Debtor advised it had filed an
Amended Plan and Disclosure Statement, and accordingly, the
hearing on the adequacy of the previously filed disclosure
statement was adjourned. The Amended Plan and Disclosure
Statement provide for an auction of the equity of the Company.
Proposed bidding procedures for such an auction were also filed
with the Court and will be reported on when approval is given,
which is expected to occur in several weeks. The next hearing in
the case is scheduled for August 2, with a possible telephonic
hearing to be scheduled on the auction issues before the end of
June, F&D's review of the Court's docket shows.


NETSOL INTL: Obtains Restraining Order Against Shareholder Group
----------------------------------------------------------------
On June 11, 2001 NetSol International, Inc., under the direction
of CEO Najeeb Ghauri, obtained a restraining order preventing
the below-described action from continuing until Court hearing
on June 15, 2001. Netsol's management team and eight member
board of directors continue to run the company. Under the Nevada
court order, the insurgent shareholder group and the directors
it claims to have elected are prohibited from taking any action
whatsoever with respect to the company, at least until the court
hearing scheduled for Friday June 15, 2001. The Court found that
NetSol has shown a reasonable probability of success on the
merits of its claim, specifically that the defendants are not
properly elected members of the Board of Directors of NetSol,
and that their purported election violates Nevada law.

                        *   *   *

On June 8, 2001, the NetSol Shareholders Group, LLC delivered to
the Secretary of NetSol International, Inc. written consents,
solicited pursuant to a Definitive Proxy Statement filed June 7,
2001, executed on behalf of stockholders of the Company holding
more than majority of the voting power, which (a) amended the
Bylaws of the Company to increase the maximum number of
directors from nine (9) to fifteen (15) directors, and changed
the number of authorized directors from eight (8) to fifteen
(15), and (b) elected Jonathan Iseson, Gregory Martin, Peter
Sollenne, Timothy Moynagh, Eddy Verresen, Shelly Singhal and
Donald Danks as new Directors for the Company.

On June 10, 2001, a special meeting of the Board of Directors of
NetSol International, Inc. was held. Naeem Ghauri, Cary Burch,
Jonathan Iseson, Peter Sollenne, Gregory Martin, Timothy
Moynagh, Eddy Verresen, Shelly Singhal, and Donald Danks were
present. The Board voted to immediately remove from office the
following officers: Najeeb Ghauri as Chief Executive Officer,
Irfan Mustafa as Chairman of the Board, Salim Ghauri as
President, Naeem Ghauri as Chief Operating Officer, Nasim Ashraf
as Executive Vice President, Rick Poole as Secretary and Malea
Farsai as General Counsel. The Board elected the following new
officers: Cary Burch as Chairman of the Board and Chief
Executive Officer, Peter Sollenne as President and Chief
Operations Officer, Gregory Martin as Vice-President and
Secretary, and Robert Morrow as General Counsel and Assistant
Secretary.

On June 11, 2001, the new management team took physical control
of the Company's executive offices at 24025 Park Sorrento, Suite
220, Calabasas, California 91302, and began conducting
and inventory and review of the books and records of the
Company. Upon initial review, the financial and operational
records do not appear to be kept as such records are typically
maintained in the ordinary course of business. Management
believes it may take some time to conduct a thorough and
complete review.

In reviewing the Company records, new management became aware on
June 11, 2001, of a notice from the California Secretary of
State dated April 20, 2001, stating that the Company is
currently suspended by the California Secretary of State, and
that revivor action has been denied due to nonavailability of
corporate name. The matter has been referred to the Company's
legal counsel for review and appropriate handling.

"We believe that the insurgent shareholder group's public claim
of victory was irresponsible, and, at the very least, premature
since an independent party has not counted the votes cast to
date," stated Najeeb Ghauri, chief executive officer of Netsol.
"We are disappointed with the conduct of the insurgent group and
the manner in which they continue to conduct this contest, which
by no means is over."

Irfan Mustafa, Netsol's chairman of the board of directors, went
on to say "We remain confident that we will win this proxy
contest. We are looking forward to directing our energy towards
increasing shareholder value as opposed to fighting this
wasteful proxy contest."

NetSol International Inc. is an ISO-9001 certified software
developer in the global information technology industry. With an
international workforce of more than 400 employees, NetSol
specializes in software development, proprietary and asset-based
leasing and finance programs, IT consulting, and creation of
eBusiness and Web-based solutions for a growing list of blue-
chip customers worldwide. Clients include Daimler Chrysler
Taiwan; Mercedes Benz Financing, Australia; Mercedes Benz
Leasing, Thailand; CFS Groups U.K., St. George Bank,
Australia; GMAC in Australia, and Debis Porfolio Systems, U.K.
For more information about NetSol and its subsidiaries, visit
the company's web site at www.netsol-intl.com


OWENS CORNING: Wants To Assume Roxboro NC Lease & Add Guaranty
--------------------------------------------------------------
Owens Corning asked Judge Fitzgerald for authority to assume an
unexpired lease of non-residential real property in Roxboro,
North Carolina, and to provide a guaranty by amendment to that
lease.

In January 2000, Exterior Systems, Inc., one of the Debtors,
entered into a lease of approximately 76,600 square feet of
warehouse space at S.R. 1700 in Roxboro, North Carolina. This
lease provides for a base rent of approximately $20,426.66 per
month, and expires under its terms on August 31, 2010. The
landlord of this property is Bi-Sib LLC, a North Carolina
limited liability company.

Exterior's obligations to Bi-Sib under this lease are guaranteed
by Owens Corning under a Guaranty of Lease signed the same date
as the lease. Exterior has negotiated terms of an amendment to
the Roxboro Lease by which it would lease an additional 6,000
square feet of space from Bi-Sib in exchange for additional
lease payments of $10,000 per month. Under the terms of this
amendment, Bi-Sib would also construct additional office space
at the leased premises as well as additional office space for
Exterior's use. The term of the proposed amended lease would be
the same as the original lease, expiring on August 31, 2010.

As a condition to signing the lease amendment, Bi-Sib has
required (i) the Debtors to assume the Roxboro Lease, and (ii)
Owens Corning to provide an amended guaranty of the Roxboro
Lease by which Owens Corning would guarantee Exterior's
obligations under the lease as amended.

The Debtors assured Judge Fitzgerald that the decision to assume
this lease is within their sound business judgment, a rule which
"shields a debtor's management from judicial second-guessing".
Assumption of this lease will provide significant benefit to the
Debtors' estates. Exterior is in the process of relocating
certain office facilities to their fabrication center located in
these premises, and as a condition to this relocation (which
will obligate the landlord to construct tenant improvements),
has agreed to assume this lease. The Debtors strongly believe
that this relocation is in the best interests of their restates
and creditors, and that the proposed transactions are within the
Debtors' sound business judgment.

The Debtors told Judge Fitzgerald they believe that Exterior's
and Owens Corning's proposed execution of the lease amendment
and amended guaranty are transactions in the ordinary course of
business which do not require approval of the Court. They
nevertheless seek judicial approval of the lease amendment and
amended guaranty out of an abundance of caution. (Owens Corning
Bankruptcy News, Issue No. 12; Bankruptcy Creditors' Service,
Inc., 609/392-0900)


PACIFICARE HEALTH: Fitch Rates Proposed Debt Issue at BB+
---------------------------------------------------------
Fitch assigns a `BB+' rating to PacifiCare Health Systems,
Inc.'s proposed issuance of $500 million senior notes issued
under Rule 144A. The Rating Outlook is Stable.

The rating considers PacifiCare's current operational challenges
and their effect on the Company's profitability. Underlying
these challenges has been a provider-driven movement away from
capitated contracts and towards shared- risk contracts in the
company's chosen markets. This movement began in the 1st half of
2000 and, although the trend has certainly subsided, PacifiCare
remains in the midst of a business platform transition designed
to better equip the company to manage a higher portion of
shared-risk contracting.

The end result of these operational challenges has been an
increase in the company's medical cost ratio (MCR) and a
subsequent decrease in profitability. Net income for the year
ending Dec. 31, 2000 was $161 million, down from $279 million in
1999. Net income for the quarter ending March 31, 2001 was also
low (on a relative basis) at $13 million. Although Fitch
believes that the earnings trend has pretty much leveled off,
Fitch does expect low levels to continue through 2002, with some
improvement beginning after 2001.

PacifiCare is currently in the process of refinancing its debt.
Today, debt consists of approximately $700 million of a funded
bank revolver and $100 million of public senior notes. After the
refinancing, the company's pro-forma debt structure would
consist of a $350 million bank term loan and the $500 million of
senior notes, for a total of $850 million. The company would
have additional liquidity under a $150 million undrawn revolving
credit facility. On a pro-forma basis, PacifiCare's debt
leverage - as measured by the ratio of total debt to total
capitalization - would be 30%. On a pro-forma basis, Fitch
estimates cash interest coverage to exceed 2 times (x).

PacifiCare is one of the nation's leading publicly traded
managed care services companies, serving 3.7 million members (as
of March 31, 2001) in the commercial and Medicare risk lines of
business. Although operations are conducted in eight states and
Guam, a significant portion of the company's total business
(approximately 60% on a membership basis) is in California.
PacifiCare reported total assets of $5.4 billion and total
shareholders' equity of $2 billion at March 31, 2001.


PHOENIX RESTAURANT: Appoints S. Pyeatt As New Head Of Operations
----------------------------------------------------------------
Phoenix Restaurant Group, Inc. (OTC Bulletin Board: PRGP), the
owner and operator of the Black-eyed Pea restaurant chain and
one of the largest franchisees of Denny's restaurants, announced
that Samuel D. Pyeatt has joined the Company as head of
operations for Denny's Restaurants.

In his position, Pyeatt will be responsible for all operations
for the Denny's restaurants and take on specific training and
leadership development objectives within the Black-eyed Pea
concept. Pyeatt has more than 27 years experience in the
restaurant industry, most recently as owner of Top Line Pizza, a
Papa John's franchise. He was with Grandy's Restaurants for 14
years, where he served as Vice President of Operations for five
years.

"Sam is a highly regarded restaurant industry professional with
a strong background in operating family dining restaurants,"
said Robert A. Speck, Chief Operating Officer, Phoenix
Restaurant Group. "We are excited to have him on our team and
look forward to the positive impact we believe he will have
within our Company."

The Company reported that it had cured certain defaults which
had existed under its various franchise agreements for its
Denny's restaurants. On May 22nd, the Company announced that it
had received formal notification of its default under its
Denny's franchise agreements as a result of indebtedness owed to
its franchisor, Advantica, Inc. (and its affiliates), based in
Spartanburg, South Carolina.

The Company stated that it had received a letter from Advantica
confirming that, upon receipt of certain payments which were
made May 29, all amounts set forth in the previous notice of
default will have been satisfied. Defaults which might arise
after April 11, 2001 are not waived in the letter, the Company
noted.

The Company (formerly DenAmerica Corp.) currently operates 162
casual dining and family restaurants in 19 states. The Company
operates 91 Black- eyed Pea restaurants including 80 restaurants
in Texas, Oklahoma and Arizona. The Company also operates 71
Denny's restaurants including 56 restaurants in Texas, Florida,
Oklahoma and Colorado. The Company owns the Black-eyed Pea brand
and operates the Denny's restaurants under the terms of
franchise agreements.


PIONEER CO.: Reaches Restructuring Agreement With Senior Lenders
----------------------------------------------------------------
Houston-based Pioneer Cos. said it has reached a restructuring
agreement with a majority of its senior creditors, reported Dow
Jones. Under terms of the agreement, the company's U.S.
creditors would receive on a pro-rated basis 43 percent of the
total consideration and collateral paid. The Canadian creditors
will receive 57 percent of the total consideration and
collateral paid. As long as the agreement is in effect, the
Canadian creditors and U.S. creditors have agreed that they
won't support a restructuring plan that is not "consistent with
or does not implement or achieve the allocation." As reported,
Pioneer has said that a restructuring of the company's debt may
have to occur under the supervision of a U.S. Bankruptcy Court.
(ABI World, June 18, 2001)


PNI TECHNOLOGIES: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: PNI Technologies, Inc.
         850 Center Way
         Norcross, GA 30071

Type of Business: The company is a wireless network carrier
                   providing unbranded one-way messaging network
                   services to companies for resale to their
                   customers. PSI Technologies also provide
                   networking technology products providing
                   control and routing of telephony to telecom
                   carriers.

Chapter 11 Petition Date: June 15, 2001

Court: Northern District of Georgia (Atlanta)

Bankruptcy Case No.: 01-67595-jb

Judge: Joyce Bihary

Debtor's Counsel: Herbert C. Broadfoot II, Esq.
                   2400 International Tower
                   229 Peachtree St.
                   Atlanta, GA 30303
                   Tel: 404-588-0500
                   Fax: 404-588-1125
                   Email: Herbert.Broadfoot@psinet.com

Total Assets: $28,020,130

Total Debts: $42,019,245

Debtor's 20 Largest Unsecured Creditors:

Entity                                Claim Amount
------                                ------------
MCI Worlcomm                            $356,824
Attn: Jarred McCoy
6929 N. Lakewood
MD 1.2-108
Tulsa OK 74117

Pinnacle Towers                         $206,875

Winstar Communications                  $138,179

University Street Properties            $133,248
V, LLC

Motorola                                $125,119

Midwest Tower Partners                  $110,881

American Tower Co.                      $107,898

Crown Communication                      $47,399

Subcarrier Communications                $45,886

SBA Towers                               $45,000

Qwest                                    $44,860

AAT Communications                       $42,828

Teletouch                                $38,020

Aquis Communications                     $32,444

United Cellular                          $32,351

Ameritech Illinois                       $30,945

JD Edwards                               $30,944

Metcom                                   $26,694

In-Touch Management                      $24,478

Bellsouth                                $21,620


POLAROID: Fitch Downgrades Senior Unsecured Debt Rating to CCC-
---------------------------------------------------------------
Polaroid Corp.'s senior unsecured debt is downgraded to `CCC-'
from `B-' and its $350 million secured domestic bank facility is
lowered to `CCC+' from `B+'. Both ratings remain on Rating Watch
Negative. These actions reflect sustained losses in the second
quarter due to declining revenue from Polaroid's core instant
film product lines. In addition, a liquidity crisis is of
significant concern in light of $544 million of debt due within
seven months.

Net operating losses before special charges in the second
quarter are anticipated to mirror losses in of the first quarter
as consumers continue to migrate to digital imaging. Fitch
expects credit fundamentals to further deteriorate, with credit
protection measures for the senior unsecured bondholders
remaining particularly weak.

On March 23, 2001, Polaroid's total debt outstanding
approximated $970 million, with $544 million due within one year
($394 million in bank agreements due December 2001 and $150
million in senior notes due in January 2002). Polaroid received
waivers on its leverage and interest coverage ratio covenants
contained in its domestic and UK credit agreements through May
15, 2001, which were extended through July 12, 2001. The waiver
on the domestic facility grants the lenders a security interest
in substantially all of the company's personal property,
reducing asset coverage for the unsecured bondholders.

Polaroid has taken several steps to free cash flow for debt
reduction including the completion of two divestitures in the
second quarter of 2001 totaling about $106 million in gross
proceeds, as well as discontinuing its annual $27 million
dividend, reducing capital expenditures and working capital, and
restructuring operations. Nonetheless, Fitch remains concerned
about Polaroid's ability to repay its senior notes due in
January 2002. In addition, Fitch recognizes that Polaroid must
secure additional waivers by July 12.

Fitch will continue to monitor the company's refinancing plans
and assess the credit impact of any changes. The Rating Watch
Negative status is expected to be resolved following the
resolution of the company's financing plans, the impact of any
new terms on the unsecured bondholders, and the ability of the
company to repay its maturing debt. Also considered will be the
potential for continued earnings deterioration and the company's
ability to implement further asset sales.


PRESIDENT CASINOS: Shareholders' Meeting Set For August 28
----------------------------------------------------------
The 2001 Annual Meeting of Stockholders of President Casinos,
Inc. will be held on August 28, 2001 at 1:00 p.m., prevailing
local time, aboard the "Admiral" in Laclede's Landing, N. Leonor
K. Sullivan Boulevard, St. Louis, Missouri for the following
purposes:

      (1) To elect two Class II directors to hold office until
          the 2003 Annual Meeting of Stockholders or until their
          successors shall have been duly elected and qualified;

      (2) To elect two Class III directors to hold office until
          the 2004 Annual Meeting of Stockholders or until their
          successors shall have been duly elected and qualified;

      (3) To consider and vote upon a proposal to amend the
          Company's Amended Certificate of Incorporation to
          reduce the authorized number of shares of common stock,
          $.06 par value per share ("Common Stock") from
          100,000,000 shares to _____________ shares of Common
          Stock, and to reduce the authorized number of preferred
          shares, $.01 par value per share ("Preferred Stock")
          from 10,000,000 shares to ____________ shares of
          authorized Preferred Stock; and,

      (4) To transact such other business as may properly come
          before the meeting or any adjournment(s) or
          postponement(s) thereof. The close of business on July
          11, 2001 has been fixed as the record date for the
          meeting. Only stockholders of record at that date are
          entitled to notice of and to vote at the meeting and
          any adjournment(s) or postponement(s) thereof.

The Board of Directors of the Company believes that it is in the
best interests of the Company and its stockholders to decrease
the number of authorized but unissued shares of its Common Stock
and Preferred Stock. The Board of Directors believes that the
reduction in the number of authorized shares of Common Stock and
Preferred Stock will permit the Company to save approximately
$90,000 annually in Delaware franchise taxes, while still
maintaining a sufficient number of authorized shares to permit
the Company to act promptly with respect to possible future
financing, possible acquisitions, additional issuances, and for
other corporate purposes including implementation of the
Company's Stockholders Rights Plan Adopted 1997, if necessary.


PSINET: Obtains Court Nod To Continue Customer-Related Practices
----------------------------------------------------------------
PSINet Inc. and the affiliated Debtors have the practice of
issuing credit memos to customers to resolve service
deficiencies, institute billing adjustments, correct billing
errors, pay refunds from the United States government for the E-
Rate Program etc.

After the petition date, the honoring of a credit memo issued
prepetition may be deemed a payment or offset of prepetition
debt. However, the Debtors believe that if they are unable to
honor certain credit memos in the postpetition period, the
customers concerned would cease to do business with them,
adversely affecting the interests of their creditors and their
estates.

Accordingly, the Debtors sought and obtained the Court's
authorization to continue, in their discretion, in the ordinary
course of their businesses, where necessary and appropriate and
in accordance with past practice, certain prepetition customer-
related practices of issuing and honoring credit memos for
refunds and billing adjustments. In connection with this, Judge
Gerber also authorizes and directs all applicable banks and
other financial institutions to honor prepetition checks for
payment of refunds or credits, whether such checks were
presented prior to or after the petition date.

The Debtors reckon that they issued approximately $6.4 million
of credit memos during the first quarter of 2001. Approximately
$2.1 million of the total credit memos for the quarter were
related to the termination of service. The Debtors do not expect
to honor prepetition credit memos on a post-petition basis for
such cancellations, where there is no ongoing business
relationship with the customer. Accordingly, the Debtors expect
to honor, in the first month of their bankruptcy case, no more
than approximately $1.5 million in credit memos that were issued
prepetition. The Debtors anticipate that credit memos will
amount to approximately $1.5 million a month and substantially
all of the credit memos relating to prepetition activity will be
honored by the end of June 2001.

In the Debtors' business judgment, the amount to be honored,
while substantial, is insignificant in comparison with (i) the
value that the Debtors' estates will receive from the
uninterrupted generation of revenue from customers in the
postpetition period, and (ii) the approximately $4.5 billion in
prepetition unsecured claims against the Debtors as of the
Petition Date, the Debtors told the Court. Moreover, the
practice is consistent with standard practices in the industry
and is viewed by customers as a necessary term of doing business
with Internet service and/or web-hosting service providers.
Failing to continue this practice, the Debtors believe, would
alienate affected customers and jeopardize their continued
business with the Debtors.

Specifically, the credit memos relate to:

      (a) Refunds according to specified formulas for disrupted
service under contractual service guarantees.

      (b) Billing adjustments for service deficiencies and
disrupted service under contracts that do not provide service
guarantees with specified refund formulas.

      (c) Other billing adjustments to account for changes in a
customer's service requirements, such as downgrades or in
relation to disputed amounts for highly valued customers.

      (d) Adjustments to correct billing errors.

      (e) Refunds to eligible schools and libraries under E-Rate
Program when the Government subsequently refunds a portion of
the fees ranging from 30 to 90 percent through payments to the
Debtors

According to the Debtors' business practice, credit memos are
subject to specific authorization limits. Any credit memo for
more than $500 must be approved by a supervisor and a manager;
additional authorizations are required for credit memos in
increasing amounts. Credit memos typically are offset against
amounts receivable under customer accounts and are netted,
rather than paid to customers.

The Debtors specified in the motion that they have not sought to
either assume or reject their agreements with any of their
customers to the extent that there are agreements subject to
Section 365 of the Bankruptcy Code. (PSINet Bankruptcy News,
Issue No. 2; Bankruptcy Creditors' Service, Inc., 609/392-0900)


PYCSA PANAMA: S&P Cuts Senior Secured Bond Rating to D From CC
--------------------------------------------------------------
Standard & Poor's lowered its foreign currency rating on PYCSA
Panama S.A.'s $126.5 million senior secured bonds due 2012 to
'D' from double-'C' because PYCSA Panama did not make its June
15, 2001 bond payment of about $7.8 million, which includes
principal and interest. The bonds were on CreditWatch with
negative implications.

The company owns and operates a toll road in Panama City,
Panama. Traffic growth has been insufficient to meet the
financial obligations of the project, and the debt service
reserve fund has been fully exhausted. Although PYCSA Panama has
a 10-day cure period to make the June 15 bond payment, Standard
& Poor's does not expect Grupo PYCSA, the project sponsor, to
make a capital infusion to make the payment because Grupo PYCSA
has been negotiating with bondholders to restructure the debt.
Any restructuring that leads to a deferral or reduction in
interest and/or principal payments would cause a default under
Standard & Poor's criteria, which requires companies to adhere
to the original amortization schedule.

The following factors led to lower traffic volumes than
originally projected and the subsequent default on the bonds:

      * Access to the road was impeded by the Ministry of Public
Works (MOP) institution of directional lane changes on competing
free roads during rush hours, and reliance on manual traffic
control, which slows access to the toll road from central Panama
City. However, the MOP eliminated the lane reversals on Sept. 1,
2000, which increased traffic flow to the Northern Corridor. Yet
the project is not significantly benefiting from this change
because drivers are using the newly constructed Southern
Corridor to bypass the competing free road. Management would
like to expand the project to provide motorists with a better
alternative to either the free road or the Southern Corridor. If
undertaken, the expansion would cost $94 million.

      * Drivers are more reluctant to pay the toll than
originally forecast. The toll rate is high when compared to U.S.
urban road toll rates. Additionally, truck traffic is still well
below forecast because of delays in the installation of the
transponder system. The original transponder contractor
abandoned the project and management expects to install a new
system by year-end 2001.

PYCSA Panama, wholly owned by Grupo PYCSA, issued the bonds to
finance a portion of the cost to construct the 8.1-mile Northern
Corridor and 10.1-mile Madden segment tolls roads in and near
Panama City. PYCSA Panama operates under a 30-year concession.
Constructora Vial, wholly owned by Grupo PYCSA, completed the
Northern Corridor in early 1998, but did not complete the Via
Madden until May 1999, 11 months behind the originally scheduled
completion date of July 1, 1998, due to delays in obtaining
permits, the receipt of new heavy equipment, and rainy weather.
Autovias, wholly owned by Grupo PYCSA, operates the roads under
a long-term agreement, Standard & Poor's said.


RELIANCE GROUP: Court Okays Use Of Existing Bank Accounts
---------------------------------------------------------
Reliance Group Holdings and Reliance Financial Services told the
Court that a waiver of the account closing requirements
established by the Office of the United States Trustee is
necessary and appropriate in their chapter 11 cases. The
guidelines established by the U.S. Trustee require chapter 11
debtors to, among other things:

      (a) close all existing bank accounts and open new debtor-
in-possession bank accounts;

      (b) establish one debtor-in-possession account for all
estate monies required for the payment of taxes, including
payroll taxes; and

      (c) maintain a separate debtor-in-possession account for
cash collateral.

The Debtors told Judge Gonzalez if they were required to
establish new bank accounts according to the guidelines
established by the UST, disruption to their financial affairs
and business operations would result causing adverse impact on
their reorganization efforts, thus prejudicing their creditors
and estates.

The Debtors also sought permission to deviate from the strict
investment guidelines imposed by 11 U.S.C. Sec. 345(a) in order
to invest excess cash in the Merrill Lynch Premier Institutional
Fund on an interim basis. The Merrill Lynch Fund invests
primarily in short-term U.S. Government securities, U.S. agency
securities, bank obligations, commercial paper and repurchase
agreements. It may also invest in domestic and foreign bank
obligations and other short-term debt securities issued by
domestic and foreign entities.

The Debtors currently maintain bank accounts at Chase Manhattan
Bank. Both RGH and RFS maintain a concentration account into
which nearly all of the money received from subsidiaries or
third parties is deposited. Currently, there is no money in
RFS's concentration account. Money from RGH's concentration
account is used to fund RGH's payroll account and controlled
disbursement account-the accounts from which nearly all of the
Debtor's other disbursements are made to pay for, among other
things, accounts payable, benefits obligations, payroll and
other deductions.

The Debtors maintain bank accounts at various banks for
different purposes. From time to time and in the ordinary course
of business, the Debtors may open or close accounts as their
business needs change. These bank accounts, together with the
Cash Management System, enable the Debtors to monitor, regulate
and allocate their funds in an efficient, centralized and secure
manner. The Debtors believe that they should be allowed to keep
their existing Bank Accounts.

The UST guidelines, the Debtors noted, are designed to provide a
clear line of demarcation between prepetition and postpetition
transactions and operations and prevent the inadvertent
postpetition payment of prepetition claims. The Debtors told
Judge Gonzalez they have instructed their banks not to honor any
checks issued before the Petition Date unless payment is
authorized by Order of the Court. The Debtors further assure
Judge Gonzalez they have developed procedures to control all
postpetition disbursements from the bank accounts and will
cooperate with their banking institutions to ensure that no
postpetition disbursements are made on account of prepetition
liabilities in the absence of this Court's prior approval. These
alternative procedures, the Debtors submit, will serve the same
purposes as the U.S. Trustee's account-closing requirements,
while allowing the Debtors and their creditors to retain the
benefits obtained from continuation of their existing bank
accounts and cash management system.

Considering the Debtors' request, Judge Gonzalez rules:

      (1) that the existing bank accounts be deemed to be Debtors
in Possession accounts, subject to a prohibition against
honoring pre-Petition Date checks unless specifically
authorized by the Court, and

      (2) that the Debtors may maintain and continue to use their
existing bank accounts in the same manner and with the same
account numbers, styles, and document forms as those employed
before the petition date. (Reliance Bankruptcy News, Issue No.
2; Bankruptcy Creditors' Service, Inc., 609/392-0900)


SENIOR HOUSING: Issues $25 Million Trust Preferred Securities
-------------------------------------------------------------
Senior Housing Properties Trust (NYSE: SNH) announced that it
has priced an offer of one million 10 1/8 % Trust Preferred
Securities. The Trust Preferred Securities were priced at, and
have a liquidation amount of, $25 per Security. The distribution
rate is $2.53 per Security per year and is paid quarterly in
arrears on September 15, December 15, March 15 and June 15 of
each year beginning on September 15, 2001. The maturity of these
Securities is June 15, 2041, and they are callable at par on or
after June 15, 2006. The sale of these Securities is expected to
settle on June 21, 2001.

SNH will use the proceeds of the offering to repay outstanding
borrowings on SNH's revolving credit facility.

The Trust Preferred Securities are expected to be listed on the
New York Stock Exchange.

The joint book-running managers for the offering were UBS
Warburg and Salomon Smith Barney. Co-managers of this offering
were A.G. Edwards & Sons, Inc., First Union Securities, Inc.,
Prudential Securities, Credit Suisse First Boston and Tucker
Anthony Sutro Capital Markets.


SMARTEGG PRODUCTIONS: StrategyWeb Subsidiary Ceases Operations
--------------------------------------------------------------
StrategyWeb Communications Inc.(CDNX:SWC) announced that its
operating subsidiary, SmartEgg Productions, has ceased
operations. SmartEgg Productions was formerly the most active
operating subsidiary of StrategyWeb and operations were halted
due to unfavourable competitive and market conditions which have
made unprofitable computer and computer peripheral distribution
businesses generally and SmartEgg Productions' printer and
printer supply business specifically, with no reasonable
likelihood for a turnaround.

The closure of SmartEgg Productions has caused a delay in
completion of the consolidated financial statements of
StrategyWeb for the year ended December 31, 2000. The company
hopes that the financial statements will be available for
dissemination by the end of July, 2001 subject to its auditor
obtaining all necessary documents and completing its review.

StrategyWeb intends to continue to seek possible opportunities
to enhance value for shareholders.

Trading of common shares of StrategyWeb on The Canadian Venture
Exchange has been halted at the request of the company pending
dissemination of this news release.

StrategyWeb Communications Inc. is a Canadian technology company
dedicated to bringing cutting edge hardware and software
solutions to the workplace. StrategyWeb Communications Inc.
currently has 7,346,973 issued and outstanding shares.


SPINCYCLE INC.: Senior Discount Noteholders Approve Equity Swap
---------------------------------------------------------------
SpinCycle, Inc. has received the requisite number of votes to
approve its restructuring plan, consisting of a debt for equity
exchange. In April 1998, SpinCycle sold senior subordinated
discount notes in a 144A offering to qualified institutional
buyers. As of May 1, 2001, the notes represented $144,990,000 in
accreted principal amount. On April 6, 2001, SpinCycle, Inc.
commenced an exchange offer to the holders of its senior
discount notes due 2005 and a consent solicitation to a
prepackaged plan of reorganization to holders of record of the
notes as of April 2, 2001 as described in SpinCycle's
confidential restructuring memorandum dated April 6, 2001. In
accordance with the exchange offer, each noteholder will receive
26.19 shares of SpinCycle, Inc. stock in exchange for each
$1,000 principal (accreted value) of tendered notes. Holders of
the notes will not receive any additional consideration in
respect of any accrued interest. SpinCycle simultaneously
solicited the consent of its common and preferred stockholders
to the exchange and prepackaged plan of reorganization. As of
5:00 p.m. (EDT) on June 11, 2001, holders of 100% of the notes
outstanding had consented to the exchange offer and tendered
their notes for exchange. As of May 7, 2001, SpinCycle had also
received the requisite vote of each class of its stockholders to
the exchange and prepackaged plan. Upon consummation of the
exchange, SpinCycle's only outstanding indebtedness (other than
trade payables) will be to its bank lenders.


TITANIUM METALS: Names Patrick Murray As New Director
-----------------------------------------------------
Titanium Metals Corporation (NYSE: TIE) appointed Patrick M.
Murray as a director of Titanium Metals Corporation and a member
of its audit committee effective June 8, 2001. Mr. Murray is
currently President and Chief Executive Officer of Dresser, Inc.
Headquartered in Dallas, Texas, Dresser, Inc. is a worldwide
leader in the design, manufacture and marketing of highly
engineered equipment and services sold primarily to customers in
the flow control, measurement, and power systems segments of the
energy industry.

Prior to assuming his present position with Dresser, Inc., Mr.
Murray served as President of Halliburton Company's Dresser
Equipment Group Inc., and as Senior Vice President, Strategic
Initiatives and Vice President, Operations of Dresser
Industries, Inc. From 1988 through 1996, Mr. Murray served as
President of Sperry-Sun Drilling Services, a leading directional
drilling and measurement-while-drilling services company.

Titanium Metals Corporation, headquartered in Denver, Colorado,
is a leading worldwide integrated producer of titanium metal
products. Information on TIMET is available on the world wide
web at http://www.timet.com


U.S. OFFICE: Wants More Time to File a Plan of Reorganization
-------------------------------------------------------------
According to documents obtained by BankruptcyData.com, U.S.
Office Products Company filed a motion seeking U.S. Bankruptcy
Court approval of an extension of the exclusive period during
which the Company can file a plan of reorganization and solicit
acceptances thereof. The Court scheduled a July 2, 2001 hearing
to decide on the matter. (New Generation Research, June 18,
2001)


VLASIC FOODS: Rule 9027 Removal Period Extended Through July 30
---------------------------------------------------------------
Judge Walrath granted Vlasic Foods International, Inc. an
extension of the deadline, pursuant to Rule 9027 of the Federal
Rules of Bankruptcy Procedure, within which they can elect to
remove prepetition lawsuits to the District of Delaware for
further litigation through the longer of (a) July 30, 2001 or
(b) 30 days after entry of an order terminating the automatic
stay of any particular action sought to be removed, all without
prejudice to the Debtors' right to seek further extensions of
the time period to remove actions.

Robert A. Weber, Esq., at Skadden, Arps, Slate, Meagher & Flom
in Wilmington, Delaware, said that the Debtors seek a "modest"
90-day extension of the removal period to determine which
actions, if any, should be removed. More than two-dozen
litigation proceedings have been identified, from the Debtors'
respective schedules of assets and liabilities, and statements
of financial affairs, for which removal might be appropriate.

The Debtors believe the extension will give them sufficient
opportunity to make fully informed decisions concerning the
possible removal of any action, protecting the Debtors' valuable
right to adjudicate lawsuits in federal court, if the
circumstances warrant removal.

Mr. Weber assured that the extension will not cause any harm to
the Debtors' adversaries, if any, because they are not allowed
to pursue their actions if they are cannot obtain relief from
the automatic stay. The extension will not also prevent any
party to a removed proceeding from pursuing a remand, nor will
it prejudice the rights of other parties to any actions. (Vlasic
Foods Bankruptcy News, Issue No. 5; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


W.R. GRACE: APD Committee Retains Ferry & Joseph As Co-Counsel
--------------------------------------------------------------
The Official Committee of Asbestos Property Damage Claimants in
W. R. Grace & Co.'s chapter 11 cases, acting through its
Chairperson, Marco Barbanti, asked Judge Farnan to authorize the
retention of the law firm of Ferry & Joseph PA, nunc pro tunc as
of April 18, 2001, as local counsel for the Committee. The
professional services to be rendered by Ferry is the
representation of the Committee as local counsel, and the
performance of legal services for the Committee as may be
necessary.

Approval nunc pro tunc is warranted, Mr. Barbanti said, because
the complexity of these cases has necessitated that the
Committee's professionals, including Ferry, devote substantial
resources to their representation of the Committee and begin
service as soon as possible.  Further, the nunc pro tunc
approval of the application prejudices no party in interest,
since Ferry has been active in these cases since its retention
by the Committee and has, inter alia, appeared at several
hearings and filed and served papers in these cases.

Mr. Michael B. Joseph, a partner of the firm, told Judge Farnan
that the firm has no connection with the debtors, their material
secured or unsecured creditors, or any other significant parties
in interest or the respective attorneys, except that Mr. Joseph
is a Chapter 7 trustee in the unrelated case of High Strength
Steel, and Laura Jones, the Debtors' counsel, is counsel to the
Trustee. Ferry & Joseph also represents San Diego County,
California, as local counsel in the Montgomery Ward LLC
bankruptcy case.  Ferry & Joseph also represents Harris County,
Texas, the City of Houston, and the City of El Paso, Texas, as
local counsel, in Reading China & Glass, Inc., Montgomery Ward,
just for Feet, Discovery Zone, Venture Stores, Silver Cinemas
International, and Winstar Communications.  However, neither
Ferry & Joseph nor Mr. Joseph individually represent any
interest adverse to the debtors or to their estates in the
matters upon which engagement is sought.

Mr. Joseph advised that the current hourly rates for the
attorneys and paralegals that will be principally responsible
for the representation of the Committee are:

                 Partners               $250-$275
                 Associates             $150-185
                 Paralegals             $ 85
                 Case clerks            $ 50

(W.R. Grace Bankruptcy News, Issue No. 7; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


WARNACO GROUP: Engages Skadden Arps As Special Counsel
------------------------------------------------------
By application, The Warnaco Group, Inc. sought to employ
Skadden, Arps, Slate, Meagher & Flom LLP, as their special
counsel as of the Petition Date.

Since 1988, Skadden has represented the Debtors on various
specific corporate, financing, securities, tax, litigation, and
other significant matters.  Because of the firm's familiarity
with their businesses, the Debtors believe Skadden's continued
representation will be a great help in assisting their General
Bankruptcy Counsel.

Warnaco, Stanley P. Silverstein, vice-president of The Warnaco
Group relates, will look to Skadden to:

       (a) Advise the Debtors and assist General Bankruptcy
Counsel in connection with any contemplated sales of assets or
business combinations, including the negotiation of asset, stock
purchase, merger or joint venture agreements, the formulation
and implementation of bidding procedures, the evaluation of
competing offers, the drafting of appropriate corporate
documents with respect to the proposed sales and counseling the
Debtors in connection with the closing of such sales;

       (b) Advise the Debtors and assist General Bankruptcy
Counsel in connection with the Debtors' post-petition financing
and cash collateral arrangements and negotiating and drafting
documents relating thereto, provide advice and counsel with
respect to pre-petition financing arrangement, and provide non-
bankruptcy services and advice to the Debtors in connection with
emergence financing and capital structure, and negotiate and
draft documents relating thereto;

       (c) Assist General Bankruptcy Counsel in advising the
Debtors on matters relating to the evaluation of the assumption,
rejection or assignment of unexpired leases and executory
contracts;

       (d) Advice the Debtors and assist General Bankruptcy
Counsel in drafting a disclosure statement accompanying a plan
of reorganization;

       (e) Provide non-bankruptcy advice to the Debtors and
assist General Bankruptcy Counsel with respect to legal issues
arising in or relating to the Debtors' ordinary course of
business including attendance at senior management meetings,
meetings with the Debtors' financial and turnaround advisors and
meetings of the board of directors, and advising on employee,
workers' compensation, employee benefits, labor, tax,
environmental, banking, insurance, securities, corporate,
business operation, contracts, joint ventures, real property,
press/public affairs, and regulatory matters;

       (f) Continue to represent the Debtors (and to the extent
no divergence of interest exists and at the Debtors' request in
connection with the Debtors' indemnification obligations and
other corporate interests, the directors, employees and officers
thereof) in connection with specific matters involving the
Securities and Exchange Commission, all litigation matters in
which Skadden, Arps has appeared as of the commencement of the
Chapter 11 cases, and such other matters as shall arise from
time to time assigned by the Debtors to, and accepted by,
Skadden, Arps;

       (g) Advise the Debtor and assist General Bankruptcy
Counsel with respect to continuing disclosure and reporting
obligations, if any, under securities laws;

       (h) Attending meetings with third parties and
participating in negotiations with respect to the above matters;

       (i) Appear before the courts with respect to the matters
referred to above; and

       (j) Perform the full range of services normally associated
with matters such as this as the Debtors' special counsel which
Skadden, Arps is in a position to provide in connection with the
matters referred to above.

An Engagement Agreement dated April 23, 2001, provides for the
continuation of a retainer program.  The Debtors paid Skadden,
Arps a retainer of $975,000 during April and May 2001 for
professional services to be rendered and charges and
disbursements to be incurred on behalf of the Debtors.  In
addition to the initial retainer, the Debtors paid Skadden, Arps
a supplemental retainer of $400,000 in June and a filing
retainer of $750,000.

In the 90-day period preceding the Petition Date, the total
amount billed by Skadden, Arps was $1,712,272 and the total
collections they received during that period (excluding the
unused retainer disclosed above) reached $1,309,329.

Skadden's hourly rates, under its bundled rate structure, range
from:

         Partners                           - $445 to $670
         Counsel/Special Counsel            - $415
         Associates                         - $250 to $415
         Legal assistants and support staff - $80 to $160

These hourly rates are subject to periodic increases.  Skadden,
Arps also intends to apply to the Court for allowance of
compensation for professional services rendered and
reimbursement of expenses incurred in these cases.  Skadden,
Arps will also seek compensation for the services of each
attorney and paraprofessional acting on behalf of the Debtors in
these cases at the then-current standard bundled rate charged
for such services on a non-bankruptcy matter.  Skadden, Arps
will continue to charge the Debtors for all other services
including costs for telephone charges, photocopying (at a
reduced rate of 10 cents per page), travel, business meals,
computerized research, messengers, couriers, postage, witness
fees, and other fees related to trials and hearings.

John Wm. Butler, Jr., Esq., the Skadden member in charge of the
Firm's restructuring practice, discloses that Skadden might have
represented, represents and likely will represent certain
creditors of the Debtors and other parties-in-interest, but in
matters unrelated to the Debtors' reorganization cases.  Mr.
Butler is aware of these current and past representations of
parties-in-interest:

       (a) Secured Creditors: Bank of America N.A.; Bank Leumi
USA; Bank of Tokyo-Mitsubishi Trust Company; Citibank N.A.;
Citicorp; Commerzbank AG; First Union National Bank; Fleet Bank
N.A.; General Electric Capital Corporation; HSBC Bank USA; IBJ
Trust Company; IBJ Whitehall Bank and Trust Company; KBC Bank
N.V.; KBC Nederland N.V.; certain affiliates of Morgan Guaranty
Trust Company; National Westminster Bank; Nations Bank; Salomon
Smith Barney Inc.; Scotia Capital USA Inc., Societe Generale;
Sun Trust Bank; The Bank of New York; The Bank of Nova Scotia;
The Dai-Ichi Kangyo Bank Ltd; The Industrial Bank of Japan Ltd;
The Sanwa Bank Ltd; UniCredito Italiano; Union Bank of
California N.A.; and Wachovia Bank N.A.

       (b) Top 50 Unsecured Creditors (as of April 22, 2001):
Active Media Services Inc.; some affiliates of Fab Industries;
Kroll Associates Inc.; Milliken & Co.; some affiliates of
Liberty Fabrics; and Xerox Corporation.

       (c) Major Shareholders: Metropolitan Life Insurance
Company, Prudential Insurance of America; T. Row Price
Associates Inc.; and Linda J. Wachner.  The managing member of
Ilex Partners, LLC, a major shareholder of the Debtor, is
controlled by Michael H. Steinhardt.  Mr. Steinhardt has a
beneficial interest in certain firm clients.

       (d) Collateral Trustee: State Street Bank and Trust
Company, which is the collateral trustee in the October 6, 2000,
amendment and extension of the Debtors' existing financing
facilities.

       (e) Directors and Officers: William Finkelstein, Stanley
Silverstein, and Linda J. Wachner with respect to pending
shareholder litigation arising out of indemnification claims and
the current officers and directors of the Debtors solely in
connection with specific matters involving the Securities and
Exchange Commission (such representation by Skadden, Arps will
continue only so long as there is no disparate interests between
the Debtors and such officers and directors).  In the past,
Skadden, Arps has also represented directors Donald G. Drapkin
and Linda J. Wachner in their individual capacities in
connection with matters unrelated to the Debtors.  Although
Skadden, Arps does not represent any other current or former
officers or directors of the Debtors, certain officers or
directors also serve on the boards of, or own beneficial
interests, in companies that are clients of Skadden, Arps on
matters not in connection with the scope of representation of
the Debtors for which retention is sought.

       (f) Professionals: Deloitte & Touche LLP; S.G. Cowen
Securities Corp.; and UBS Warburg.

       (g) Non-Debtors Parties to Licence Agreements: Calvin
Klein; Fruit of the Loom, Inc.; Polo Ralph Lauren Corp.; and
Polo Sport Ralph Lauren.

       (h) 5 Largest Customers of the Debtors: Federated
Department Stores; The May Department Stores Company; Price
Costco Inc.; and Wal-Mart Stores Inc.

       (i) 5 Largest Vendors to the Debtors: Active Media
Service; Guilford Mills.

       (j) Significant Litigation Parties: J.C. Penny Company
Inc.; The Limited Inc., The May Department Stores Company;
McNeil Real Estate Fund IX Ltd.; Sears Roebuck and Company;
Service Merchandise Company Inc.; and United International Corp.

       (k) Major Insurance Carriers, Claims Service Providers and
Insurance Brokers/Consultants: ACE INA Insurance Company, AJG
Claims Services Inc.; Continental Casualty Company; Liberty
Mutual Insurance Company; Lumbermans Mutual Casualty; Ohio
Casualty Insurance Company; Reliance National; and St. Paul Fire
& Marine.

       (l) Holders of 5% or more of preferred securities issued
by Designer Finance Trust: Deutsche Bank AG.

       (m) Other matters: Prior to the Debtors' acquisition of
Designer Holdings Ltd.; Skadden, Arps represented Designer
Holdings Ltd. in several matters including its negotiation of a
jeanswear licensing agreement with Calvin Klein.

Mr. Butler assured the Court that Skadden does not and will not
represent any of these parties-in-interest in any matter related
to Warnaco's chapter 11 cases. (Warnaco Bankruptcy News, Issue
No. 2; Bankruptcy Creditors' Service, Inc., 609/392-0900)


WINSTAR COMMUNICATIONS: Committee Taps Bayard As Local Counsel
--------------------------------------------------------------
The Committee applied to retain The Bayard Firm, P.A, as its
local counsel in Winstar Communications, Inc.'s Chapter 11
cases.  The Committee picked Bayard because of its attorneys'
expertise and lack of conflict of interest in the Debtors'
cases.  Bayard's primary attorneys and paralegals expected to
represent the Committee, and their respective hourly rates, are:

                 Neil B. Glassman            $415
                 Steven M. Yoder             $260
                 Daniel K. Astin             $260
                 Christopher A. Ward         $210
                 Heide Snyder (paralegal)    $125

Other attorneys and paralegals will also render services to the
Committee as needed.  Bayard's hourly rates range from: $300 to
$415 per hour for directors, $175 to $260 per hour for
associates, and $115 to $125 per hour for paralegals.  The
hourly rates may change depending on economic and other
conditions.

Bayard also expects to be reimbursed of the actual and necessary
expenses that Bayard incurs, such as telephone and telecopier
charges, toll charges, mail and express mail charges, special or
hand delivery charges, document processing, photocopying
charges, travel expenses, expenses for "working meals",
computerized research, and transcription costs, as well as non-
ordinary overhead expenses like overtime for secretarial
personnel and other staff.

The services Bayard will render to the Committee include:

       (a) Provide legal advice with respect to its powers and
duties as an official committee appointed under the Bankruptcy
Code section 1102;

       (b) Assist in the investigation of the acts, conduct,
assets, liabilities, and financial condition of the Debtors, the
operation of the Debtors' businesses, and any other matters
relevant to the case or to the formulation of a plan of
reorganization or liquidations;

       (c) Prepare on behalf of the Committee necessary
applications, motions, complaints, answers, orders, agreements
and other legal papers;

       (d) Review, analyze and respond to all pleadings filed by
the Debtors and appearing in court to present necessary motions,
applications and pleadings and to otherwise protect the
interests of the Committee; and

      (e) Perform all other legal services for the Committee that
may be necessary and proper in these proceedings.

Bayard Director Neil B. Glassman assured Judge Farnan that
Bayard has no connection with the Debtors, their creditors, any
other parties-in-interest, the Debtors' attorneys, the United
States Trustee, or any person employed in the Office of the US
Trustee. Neither does Bayard hold or represent any entity with
adverse interest in connection with Winstar's cases, Mr.
Glassman added, except those disclosed to the Court.

Bayard disclosed past or current clients in matters unrelated to
the Debtors' Chapter 11 cases: The Bank of New York, Credit
Suisse First Boston, Dresdner Bank AG, Bank of Montreal, and
Chase Manhattan Bank USA National Association.  Bayard has also
previously served as Debtor's counsel to U.S. One Communications
Corp., whose assets were purchased by Winstar or an affiliate
thereof in 1997.  Bayard also reveals the past or current
parties that it may be currently, or in the past may have been,
adverse to in matters unrelated to the Debtors' Chapter 11
cases: General Electric Capital Corporation and affiliates,
Chase Securities Inc. and affiliates, and Chase Manhattan Bank
and affiliates.

Mr. Glassman maintained that Bayard is a "disinterested person".

Bayard also intends to work closely with Cadwalader, Wickersham
& Taft, the law firm that is eyed to act the Committee's lead
counsel, to ensure that there will be no unnecessary duplication
of services performed for or charged to the Debtors' estate.
(Winstar Bankruptcy News, Issue No. 5; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


* Meetings, Conferences and Seminars
------------------------------------
June 21-22, 2001
    RENAISSANCE AMERICAN MANAGEMENT & BEARD GROUP, INC.
       Bankruptcy Sales & Acquisitions
          The Renaissance Stanford Court Hotel,
          San Francisco, California
             Contact: 1-903-592-5169 or ram@ballistic.com

June 25-26, 2001
    TURNAROUND MANAGEMENT ASSOCIATION
       Advanced Education Workshop
          The NYU Salomon Center at the Stern School
          of Business, New York, NY
             Contact: 312-822-9700 or info@turnaround.org

June 28-July 1, 2001
    NORTON INSTITUTES ON BANKRUPTCY LAW
       Western Mountains, Advanced Bankruptcy Law
          Jackson Lake Lodge, Jackson Hole, Wyoming
             Contact: 770-535-7722 or Nortoninst@aol.com

June 28-July 1, 2001
    American Bankruptcy Institute
       Hawaii CLE Program
          Outrigger Wailea Resort, Maui, Hawaii
             Contact: 1-703-739-0800 or http://www.abiworld.org

June 30 through July 5, 2001
    National Association of Chapter 13 Trustees
       Annual Seminar
          Marriott Hotel and Marina, San Diego, California
             Contact: 1-800-445-8629 or http://www.nactt.com

July 12-15, 2001
    American Bankruptcy Institute
       Northeast Bankruptcy Conference
           Stoweflake Resort, Stowe, Vermont
             Contact: 1-703-739-0800 or http://www.abiworld.org

July 17-20, 2001
    INSOL International
       6th World Congress
          London, England
             Contact: tina@insol.ision.co.uk or
                  http://www.insol2001.com

July 19, 2001
    International Women's Insolvency and Restructuring
    Confederation (IWIRC)
       Latest Events in Chapter 11 Practice
          The Princeton Club, New York, NY
             Contact: 212-481-4369

July 26-28, 2001
    ALI-ABA
       Chapter 11 Business Reorganizations
          Hotel Loretto, Santa Fe, New Mexico
             Contact: 1-800-CLE-NEWS or http://www.ali-aba.org

August 1-4, 2001
    American Bankruptcy Institute
       Southeast Bankruptcy Conference
          The Ritz-Carlton, Amelia Island, Florida
             Contact: 1-703-739-0800 or http://www.abiworld.org

August 10-11, 2001
    Association of Insolvency and Restructuring Advisors
       Distressed M&A Conference
          Ocean Place Conference Resort, Long Branch, New Jersey
             Contact: aira@airacira.org

September 6-9, 2001
    American Bankruptcy Institute
       Southwest Bankruptcy Conference
          The Four Seasons Hotel, Las Vegas, Nevada
             Contact: 1-703-739-0800 or http://www.abiworld.org

September 7-11, 2001
    National Association of Bankruptcy Trustees
       Annual Conference
          Sanibel Harbor Resort, Ft. Myers, Florida
             Contact: 1-800-445-8629 or http://www.nabt.com

September 10-11, 2001
    RENAISSANCE AMERICAN MANAGEMENT, INC. & BEARD GROUP
       Fourth Annual Conference on Corporate Reorganizations
          The Knickerbocker Hotel, Chicago, IL
             Contact 1-903-592-5169 or ram@ballistic.com

September 13-14, 2001
    ALI-ABA
       Corporate Mergers and Acquisitions
          Washington Monarch, Washington, D. C.
             Contact:  1-800-CLE-NEWS or http://www.ali-aba.org

September 14-15, 2001
    American Bankruptcy Institute
       ABI/Georgetown Program "Views from the Bench"
          Georgetown University Law Center, Washington, D.C.
             Contact: 1-703-739-0800 or http://www.abiworld.org

October 3-6, 2001
    American Bankruptcy Institute
       Litigation Skills Symposium
          Emory University School of Law, Atlanta, Georgia
             Contact: 1-703-739-0800 or http://www.abiworld.org

October 12-16, 2001
    TURNAROUND MANAGEMENT ASSOCIATION
       2001 Annual Conference
          The Breakers, Palm Beach, FL
             Contact: 312-822-9700 or info@turnaround.org

October 16-17, 2001
    International Women's Insolvency and Restructuring
    Confederation (IWIRC)
       Annual Fall Conference
          Somewhere in Orlando, Florida
             Contact: 703-449-1316 or
                  http://www.inetresults.com/iwirc

October 28 - November 2, 2001
    IBA Business Law International Conference
    Including Insolvency and Creditors Rights Sessions
       Cancun, Mexico
          Contact: +44 (0) 20 7629 1206
             http://www.ibanet.org/cancun

November 26-27, 2001
    RENAISSANCE AMERICAN MANAGEMENT, INC. & BEARD GROUP
       Seventh Annual Conference on Distressed Investing
          The Plaza Hotel, New York City
             Contact 1-903-592-5169 or ram@ballistic.com

November 29-December 1, 2001
    American Bankruptcy Institute
       Winter Leadership Conference
          La Costa Resort & Spa, Carlsbad, California
             Contact: 1-703-739-0800 or http://www.abiworld.org

January 31 - February 2, 2002
    American Bankruptcy Institute
       Rocky Mountain Bankruptcy Conference
          Westin Tabor Center, Denver, Colorado
             Contact: 1-703-739-0800 or http://www.abiworld.org

January 11-16, 2002
    Law Education Institute, Inc
       National CLE Conference(R) - Bankruptcy Law
          Steamboat Grand Resort, Steamboat Springs, Colorado
             Contact: 1-800-926-5895 or
                  http://www.lawedinstitute.com

February 28-March 1, 2002
    ALI-ABA
       Corporate Mergers and Acquisitions
          Renaissance Stanford Court, San Francisco, California
             Contact: 1-800-CLE-NEWS or http://www.ali-aba.org

March 3-6, 2002 (tentative)
    NORTON INSTITUTES ON BANKRUPTCY LAW
       Norton Bankruptcy Litigation Institute I
          Park City Marriott Hotel, Park City, Utah
             Contact:  770-535-7722 or Nortoninst@aol.com

March 15, 2002 (Tentative)
    American Bankruptcy Institute
       Bankruptcy Battleground West
          Century Plaza Hotel, Los Angeles, California
             Contact: 1-703-739-0800 or http://www.abiworld.org

April 10-13, 2002 (tentative)
    NORTON INSTITUTES ON BANKRUPTCY LAW
       Norton Bankruptcy Litigation Institute II
          Flamingo Hilton, Las Vegas, Nevada
             Contact:  770-535-7722 or Nortoninst@aol.com

April 18-21, 2002
    American Bankruptcy Institute
       Annual Spring Meeting
          J.W. Marriott, Washington, D.C.
             Contact: 1-703-739-0800 or http://www.abiworld.org

May 13, 2002 (Tentative)
    American Bankruptcy Institute
       New York City Bankruptcy Conference
          Association of the Bar of the City of New York
          New York, New York
             Contact: 1-703-739-0800 or http://www.abiworld.org

June 6-9, 2002
    American Bankruptcy Institute
       Central States Bankruptcy Workshop
          Grand Traverse Resort, Traverse City, Michigan
             Contact: 1-703-739-0800 or http://www.abiworld.org

June 27-30, 2002
    NORTON INSTITUTES ON BANKRUPTCY LAW
       Western Mountains, Advanced Bankruptcy Law
          Jackson Lake Lodge, Jackson Hole, Wyoming
             Contact: 770-535-7722 or Nortoninst@aol.com

June __, 2002
    American Bankruptcy Institute
       Delaware Bankruptcy Conference
          Hotel Dupont, Wilmington, Delaware
             Contact: 1-703-739-0800 or http://www.abiworld.org

October 9-11, 2002
    INSOL International
       Annual Regional Conference
          Beijing, China
             Contact: tina@insol.ision.co.uk or
                  http://www.insol.org

December 5-8, 2002
    American Bankruptcy Institute
       Winter Leadership Conference
          The Westin, La Plaoma, Tucson, Arizona
             Contact: 1-703-739-0800 or http://www.abiworld.org

April 10-13, 2003
    American Bankruptcy Institute
       Annual Spring Meeting
          Grand Hyatt, Washington, D.C.
             Contact: 1-703-739-0800 or http://www.abiworld.org

December 5-8, 2003
    American Bankruptcy Institute
       Winter Leadership Conference
          La Quinta, La Quinta, California
             Contact: 1-703-739-0800 or http://www.abiworld.org

April 15-18, 2004
    American Bankruptcy Institute
       Annual Spring Meeting
          J.W. Marriott, Washington, D.C.
             Contact: 1-703-739-0800 or http://www.abiworld.org

The Meetings, Conferences and Seminars column appears in the
Troubled Company Reporter each Wednesday.  Submissions via
e-mail to conferences@bankrupt.com are encouraged.


                            *********


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

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

Each Friday's edition of the TCR includes a review about a book
of interest to troubled company professionals. All titles are
available at your local bookstore or through Amazon.com. Go to
http://www.bankrupt.com/books/to order any title today.

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


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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, Bernadette de Roda, Aileen Quijano and Peter A.
Chapman, Editors.

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

This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without
prior written permission of the publishers.  Information
contained herein is obtained from sources believed to be
reliable, but is not guaranteed.

The TCR subscription rate is $575 for 6 months delivered via e-
mail. Additional e-mail subscriptions for members of the same
firm for the term of the initial subscription or balance thereof
are $25 each.  For subscription information, contact Christopher
Beard at 301/951-6400.

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