TCR_Public/011108.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

            Thursday, November 8, 2001, Vol. 5, No. 219

                           Headlines

360NETWORKS: Court Extends Rule 9027 Removal Period To March 25
ABBEY FINANCIAL: Trustee Seeks Out Owners of Unclaimed Monies
ABC-NACO INC.: Proposes Bidding Procedures to Sell its Assets
AMF BOWLING: Committee Wants Disclosure Statement Hearing Delay
ANCHOR LAMINA: S&P Places Low-B Ratings on Credit Watch Negative

BETHLEHEM STEEL: Vendors Granted Administrative Priority Status
BETHLEHEM STEEL: Court Grants Final Approval of $450MM DIP Loan
CABLEVISION SYSTEMS: S&P Affirms Low-B Ratings, Outlook Negative
CAPITAL ENVIRONMENTAL: Reports $2.5MM Net Loss For Third Quarter
COHO ENERGY: Continues Sales Talks to Cure Borrowing Deficiency

COMDISCO INC.: Court Allows Banks To File One Proof of Claim
CORAM HEALTHCARE: Shareholders Intend To Fight Plan
E.SPIRE COMMS: Asks Court to Stretch Exclusive Period to Jan. 31
eNUCLEUS INC.: Emerges From Chapter 11 Bankruptcy
EXODUS COMMS: Sprint Demands Adequate Assurance of Payment

EXODUS COMMUNICATIONS: Court Okays $200 Million DIP Financing
FAIRFAX FINANCIAL: S&P Drops Senior Debt Rating to BB+ From BBB-
FEDERAL-MOGUL: Hiring Dykema & Gossett as Special Counsel
FIRSTPLUS FINANCIAL: Freedom Commercial Acquires Majority Stake
FREDERICK'S: Likely To File Chapter 11 Plan After the Holidays

GC COMPANIES: Seeks To Extend Lease Decision Period To Jan. 31
HERCULES: Exchange Offer & Withdrawal Rights To Expire On Dec. 7
HMG WORLDWIDE: Gets Interim Court Nod For DIP Financing Pact
HOUSE2HOME INC: Ratings Fall to D After Missed Interest Payment
HOUSE2HOME INC: Files Chapter 11 Petition in Santa Ana, Calif.

INTEGRATED BUSINESS: Shares Face Nasdaq Delisting
LOEWEN GROUP: Retains Bordelon Hamlin as Special Counsel
LTV STEEL: Agrees with USWA to Expand Retirement Opportunities
MADISON RIVER: Tight Liquidity Prods S&P to Put Ratings on Watch
NORTHLAND CRANBERRIES: Effects Reverse Split & Delists Shares

NORTHLAND CRANBERRIES: Sun Affiliate Takes-On Debt & Control
NORTHLAND CRANBERRIES: Sees $100-110 Million Loss For FY 2001
OWENS CORNING: Asbestos Panel Taps Prof. Warren as Consultant
PLAYTEX PRODUCTS: S&P Affirms Low-B Ratings With Neg. Outlook
POLAROID CORPORATION: Seeks Approval of KPMG's Employment

POLAROID: ID Unit Auction Draws Resistance from Creditors
RENT-WAY INC.: Makes Tender Offer To Exchange Securities Options
RESPONSE BIOMEDICAL: Creditors Accept Canadian BIA Proposal
SABENA: Asks To End Legal Composition & Files for Bankruptcy
SAFETY-KLEEN CORP: Employs Jefferson Wells as New Accountant

SPALDING HOLDINGS: Proposes Exchange Offer to Recapitalize
SUN HEALTHCARE: THCI Mortgage Seeks Relief From Automatic Stay
VLASIC FOODS: Lays-Out Case for Plan Confirmation
WARNACO: Asks Court To Permit D&O Insurer To Pay $3.3MM Claim
WINSTAR COMMUNICATIONS: Settles $8.2MM Claim Dispute With Lexent

                           *********

360NETWORKS: Court Extends Rule 9027 Removal Period To March 25
---------------------------------------------------------------
According to Judge Gropper, the period within which 360networks
inc. may seek to remove civil actions pending on the Petition
Date is enlarged and extended to and including the later to
occur of:

     (a) March 25, 2002, or

     (b) the day which is 30 days after entry of an order
         terminating the automatic stay with respect to the
         particular action sought to be removed.

(360 Bankruptcy News, Issue No. 11; Bankruptcy Creditors'
Service, Inc., 609/392-0900)    


ABBEY FINANCIAL: Trustee Seeks Out Owners of Unclaimed Monies
-------------------------------------------------------------
Robert Ercolini & Company LLP, under the liquidation plan of
Abbey Financial Corporation, invites all creditors and anyone
else who believes they are entitled to any compensation from
Abbey Financial Corporation to contact them immediately.

"We're making every effort possible to reach anyone who may be
entitled to compensation from now defunct Abbey Financial
Corporation," said Michael Bruno, Trustee of Abbey Financial
Creditors' Trust. "There are about 100 people in the states of
Florida, Georgia, Maryland, Massachusetts, North Carolina, New
Hampshire, Washington and the District of Columbia who we have
not been able to locate. We urge them to contact us before
November 30, 2001."

Anyone interested may contact the web site www.recpa.com and go
to the Abbey Link. There is a list of creditors who the Trustee
has been unable to contact with the last known address. If you
are one of these creditors, you are urged to contact Mr. Bruno
by telephone, facsimile, or E-mail immediately.

Mr. Bruno can be reached at the following address:

             Michael Bruno
             Robert Ercolini & Company LLP
             55 Summer Street
             Boston, MA 02110-1007
             Tel: (617) 482-5511, Ext. 156
             Fax: (617) 426-5252
             E-mail: abbey@recpa.com

Abbey Financial Corporation was founded in 1986 to engage in the
business of providing residential mortgage loans in
Massachusetts, and later expanded its operations in six other
states: Florida, Washington, Maryland, New Hampshire, Georgia,
North Carolina, and the District of Columbia. The firm's loan
origination volume in 1993 was approximately $1 billion. In
1994, the firm filed for Chapter 11 bankruptcy protection and
was later ordered to cease its lending operations and distribute
its assets.

Under the liquidation plan, monies realized from liquidation of
the Abbey Financial Corporation's assets were paid to Creditors'
Trust for distribution to creditors and consumer creditors.

"We have already made several rounds of monetary distributions
to creditors, and would like to make one more push to reach
those who have not yet claimed their money," added Mr. Bruno.


ABC-NACO INC.: Proposes Bidding Procedures to Sell its Assets
-------------------------------------------------------------
After filing last month for chapter 11 bankruptcy protection,
ABC-NACO Inc. has decided to seek a buyer or buyers for its
assets and businesses, Dow Jones reported.

"The debtors have determined that they are unable to obtain the
necessary funding to restructure their affairs as operating
entities," ABC-NACO, a railroad product maker and services
provider, said. Lombard, Illinois-based ABC-NACO is seeking
bankruptcy court approval of bid procedures it would use
to facilitate a quick sale or sales.

ABC-NACO attributed its need to seek bankruptcy protection to
the severe downturn in the rail supply industry and its large
debt burden. The company's chapter 11 petition, filed on October
18 with petitions for seven units, listed consolidated assets of
$383.1 million and consolidated debts of $370.9 million as of
August 31. (ABI World, November 6, 2001)


AMF BOWLING: Committee Wants Disclosure Statement Hearing Delay
---------------------------------------------------------------
The Official Committee of Unsecured Creditors of AMF Bowling
Worldwide, Inc. moves for an order adjourning the Disclosure
Statement Hearing, now scheduled for November 8, 2001, to
November 29, 2001 or another date convenient to the Court; and
for an order requiring an expedited response to its First
Request for Production of Documents served on Debtor AMF Bowling
Worldwide, Inc.

Jonathan L. Hauser, Esq., at Troutman Sanders LLP, in Norfolk,
Virginia, relates that the Committee seeks a brief three-week
adjournment of the Disclosure Statement Hearing in order for the
Debtors to obtain significantly more detailed information
regarding the exit financing and describe it in the Disclosure
Statement. An adjournment also will allow the Committee to
complete its discovery on the valuation of the Reorganized
Company, which is necessary to determine the adequacy of
supplemental disclosure that the Debtors must make if the
unsecured creditors are to evaluate the fairness of their
distribution under the Debtors' proposed plan of reorganization.

Mr. Hauser believes that adequate disclosure concerning the exit
financing and the Enterprise Value underlying the Plan can be
achieved only through a brief delay to the Disclosure Statement
Hearing. Detailed disclosure about the exit financing and the
Enterprise Value is essential so that the creditors can
understand whether the plan offers them a fair recovery that
should be supported.

Mr. Hauser informs the Court that the Committee has also sought
documents and depositions from the financial advisors for the
Debtors and for the Senior Lenders on a schedule that would
conform with the 3-week adjournment without the need for
judicial intervention. The Committee needs an order expediting
document discovery from the Debtors to meet the same schedule.
The Committee has already served Deposition Notices and
Subpoenas Duces Tecum on the Blackstone Group L.P., financial
advisor to the Debtors, and Wasserstein Perella & Co., Inc.,
financial advisor to the Senior Secured Lenders. The documents
are to be produced on or before November 12, 2001, and the
depositions are noticed for November 19 and 20, 2001. Mr. Hauser
adds that the Committee also served its First Request for the
Production of Documents on Debtor AMF Bowling Worldwide, Inc.,
served in connection with the Committee's Objection to the
valuation information in the Disclosure Statement.

Mr. Hauser submits that the Blackstone Group and Wasserstein
Perella, which were served with subpoenas may be required to
produce documents in less than 30 days. Given the proposed
schedule for approving the Disclosure Statement, the Debtors'
desire to proceed expeditiously, the limited range of documents
requested, and the obligation of the Blackstone Group and
Wasserstein Perella to respond to their subpoenas by November
12, the Committee believes that WINC should respond to the
document request on an expedited basis. (AMF Bankruptcy News,
Issue No. 11; Bankruptcy Creditors' Service, Inc., 609/392-0900)    


ANCHOR LAMINA: S&P Places Low-B Ratings on Credit Watch Negative
----------------------------------------------------------------
Standard & Poor's placed its ratings on Anchor Lamina Inc.
(Anchor Lamina) and its subsidiary, Anchor Lamina America Inc.,
on CreditWatch with negative implications.

The CreditWatch placement reflects dampened demand as a result
of the economic uncertainty, which has increased concerns for
Anchor Lamina's profitability and liquidity.

Anchor Lamina, with C$167 million in sales in fiscal 2001,
manufactures and distributes die sets, mold bases, and related
components used in the tool and die and mold bases industries in
North America and Europe. Demand, which is primarily driven by
product life cycles in the auto industry, is subject to sharp
volatility as manufacturers have reduced capital expenditures.

The company has undertaken several measures to restore
profitability, including staff reductions and plant closures.
Furthermore, Anchor Lamina has sold the majority of its
operations in Europe, and used the proceeds to reduce
outstanding debt. Nevertheless, as of August 31, 2001, the
company had an aggressive financial profile, with debt-to-total
capital in the mid-50% area, EBITDA interest coverage of just
more than 1.0 times, and constrained financial flexibility.
Standard & Poor's will meet with management shortly to review
plans for cost-cutting and enhancing Anchor Lamina's financial
flexibility to weather the uncertain economic environment.

            Ratings Placed On Creditwatch Negative

     Anchor Lamina Inc.

         Long-term corporate credit rating        B+
         Subordinated debt rating                 B-

     Anchor Lamina America Inc.

         Long-term corporate credit rating        B+
         Subordinated debt rating                 B-


BETHLEHEM STEEL: Vendors Granted Administrative Priority Status
---------------------------------------------------------------
Bethlehem Steel Corporation sought and obtained a comfort order
from the Court:

     (i) granting the Vendors administrative expense priority
         status under section 503(b) of the Bankruptcy Code for
         undisputed obligations arising from the Outstanding
         Orders for goods that are delivered to, and accepted
         by, the Debtors subsequent to the Petition Date; and

    (ii) out of an abundance of caution, authorizing the Debtors
         to satisfy such undisputed obligations to Vendors in
         the ordinary course of business under section 363(c) of
         the Bankruptcy Code.

George A. Davis, Esq., at Weil, Gotshal & Manges LLP, in New
York, New York, relates that numerous vendors and suppliers
provide the Debtors with millions of dollars of goods (i.e.,
supplies and materials) necessary for the operation of their
businesses. As of Petition Date, Mr. Davis notes, the Debtors
had numerous pre-petition purchase orders outstanding with
vendors and suppliers.

The Debtors anticipate that their vendors might be concerned
that delivery of goods after the Petition Date pursuant to pre-
petition Outstanding Orders will render them pre-petition
general unsecured creditors of the Debtors' estates.
Accordingly, the Debtors fear that the Vendors may refuse to
ship or deliver goods to the Debtors unless:

     (1) the Debtors issue substitute purchase orders, or

     (2) obtain an order of the Court providing that all
undisputed obligations of the Debtors arising from the post-
petition delivery of merchandise subject to pre-petition
Outstanding Orders are afforded administrative expense
status.

The Debtors estimate the Outstanding Orders to reach
$500,000,000 in supplies and materials.

Mr. Davis asserts that the Court should grant the relief
requested because it will ensure a continuous supply of goods
that are indispensable to the Debtors' operations. The Debtors
contend that the purchase obligations that arise in connection
with the post-petition delivery and acceptance of goods,
including goods ordered pre-petition, are in fact administrative
expense priority claims. Thus, Mr. Davis concludes, the granting
of the relief requested will not provide the Vendors with any
greater priority than they would otherwise have if the relief is
not granted.

On the other hand, if the Court will not grant this motion, Mr.
Davis says, the Debtors may be required to expend substantial
time and effort in reissuing the Outstanding Orders to provide
the Vendors with assurance of such administrative priority. This
could disrupt the continuous flow of goods to the Debtors and
result in insufficient supplies and materials with which to
provide the products and services bargained for by their
customers. Moreover, Mr. Davis expects that such a disruption
could lead to dissatisfied customers, potentially harming
customer confidence in the Debtors' ability to conduct their
businesses at this critical juncture and, thereby, jeopardize
the prospects for a successful reorganization. (Bethlehem
Bankruptcy News, Issue No. 3; Bankruptcy Creditors' Service,
Inc., 609/392-0900)


BETHLEHEM STEEL: Court Grants Final Approval of $450MM DIP Loan
---------------------------------------------------------------
A bankruptcy court has given bankrupt steelmaker Bethlehem Steel
Corp. final approval to borrow under a $450 million debtor-in-
possession (DIP) loan with General Electric Capital Corp., Dow
Jones reported.

The loan from the financial services unit of General Electric
Co. was approved at a hearing on Monday before the U.S.
Bankruptcy Court in Manhattan.

Some revisions to the deal were agreed to in advance. One of
revisions is that a carve out for the payment of professional
fees was increased to $5 million from $3.5 million. It was also
specified that the committee could use funds to investigate
issues related to the validity of the pre-petition lenders
liens. Objections to the loan by some secured lenders had been
settled before the hearing. Bank of America N.A. and RZB Finance
LLC had filed objections to the loan to stop GE Capital Corp.
and a pre-petition lending group from getting liens on property
securing their claims.  

The DIP line replaced Bethlehem Steel's $340 million receivables
purchase line, under which $260 million was outstanding.
Bethlehem Steel filed for chapter 11 bankruptcy protection on
October 15, listing $4.2 billion of consolidated assets and $4.5
billion of consolidated debts as of September 30. (ABI World,
November 6, 2001)


CABLEVISION SYSTEMS: S&P Affirms Low-B Ratings, Outlook Negative
----------------------------------------------------------------
Standard & Poor's revised its outlook on Cablevision Systems
Corp. and unit CSC Holdings Inc. to negative from stable.

At the same time, Standard & Poor's affirmed its ratings on
Cablevision and CSC Holdings.

The outlook revision is based on the company's aggressive
digital rollout plans and the expectation that the company will
need to use additional debt to finance most of this plan, which
would result in weak financial metrics for the rating in 2002.

Cablevision is one of the largest cable operators in the U.S.,
with more than three million subscribers predominately in the
metropolitan New York area. In comparison to some of its peers,
the company has been somewhat late to market with its rollout of
digital services, and only recently began to offer selective
services to customers.

The capital and operating expenses associated with the expected
full introduction of digital services in 2002 is expected to
require additional borrowings, especially since Cablevision
cancelled a planned preferred stock offering in early 2001 due
to poor market conditions. As a result, total debt to EBITDA is
expected to be in the 7.7 times to 8.0x range on a consolidated
basis during the 2001 to 2002 time frame, excluding
collateralized debt from monetization of its common stock in
other companies, such as AT&T Corp. and AT&T Wireless Services
Inc.

Cablevision benefits from a favorable business position in the
cable industry. Its franchise has attractive demographics, which
suggest good potential penetration for digital. Yet the
weakening economy, coupled with ongoing competition from direct
broadcast satellite, will challenge the company in growing its
digital base over the next year. These risks are somewhat
mitigated by the fact that the company has some flexibility to
reduce its capital requirements if demand does not materialize.
Cablevision also benefits from the significant asset value of
its cable subscriber properties, which are well-clustered in
attractive markets.

Moreover, the company has other valuable assets, including a
large number of very marketable programming assets and
ownerships in various sports teams and entertainment venues,
such as Madison Square Garden and Radio City Music Hall, which
are included in its overall 75%-owned Rainbow Media subsidiary,
as well as a 92% economic interest in personal communications
services (PCS) provider NorthCoast Communications. The
combination of these assets provides substantial financial
flexibility and accompanying bondholder protection relative to
Cablevision's $5.9 billion in total consolidated debt as of June
30, 2001.

The company's other operations include retail store chain The
Wiz, motion picture chain Clearview Cinemas, and programming
developer Sterling Digital. These ventures are expected to
require only a modest amount of additional debt over the next
year to fund operating losses and capital requirements.  

                    Outlook: Negative

Cablevision's financial profile is expected to be weak for the
rating over the next year as it rolls out its digital television
initiative to cable subscribers. The company derives some
flexibility from access to bank funding under its $2.4 billion
bank agreement and from a significant pool of programming and
other assets. Ratings could be lowered if consolidated debt
to EBITDA exceeds 8x, excluding collateralized debt from
monetization of Cablevision's common stock in other companies,
such as AT&T and AT&T Wireless.

                   Ratings Affirmed

     Cablevision Systems Corp.              RATING
          Corporate credit rating            BB+

     CSC Holdings Inc.
          Corporate credit rating            BB+
          Senior unsecured debt              BB+
          Subordinated debt                  BB-
          Preferred stock B+


CAPITAL ENVIRONMENTAL: Reports $2.5MM Net Loss For Third Quarter
----------------------------------------------------------------
Capital Environmental Resource Inc. is a regional, integrated
solid waste services company that provides collection, transfer,
disposal and recycling services. The Company was founded in May
1997 in order to take advantage of consolidation opportunities
in the solid waste industry in markets other than major urban
centers in Canada and the northern United States. The Company
began operations in June 1997 when it acquired selected solid
waste assets and operations in Canada from Canadian Waste
Services Inc. and its parent, USA Waste Services, Inc. From the
time of commencing operations, to September 30, 2001, the
Company acquired 46 solid waste services businesses in Canada
and the United States, including 43 collection operations, 11
transfer stations, 4 recycling processing facilities and a
contract to operate 4 landfills and 1 transfer station. In
addition, the Company owns and operates a landfill in
Coronation, Alberta.  

In the second quarter of 2001, the Company sold substantially
all of its assets in the United States for a total cash purchase
price of approximately $21.8 million. The Company has recorded a
loss on disposition of its United States assets of $4.9 million
relating to severance, lease buy outs, professional fees,
receivable allowances and provisions for sale agreement
adjustments.

Total revenues for the three months ended September 30, 2001
were $22.7 million compared to $31.7 million for the three
months ended September 30, 2000. The 28.2% decrease was
primarily as a result of the disposal of U.S. operations in the
second quarter of 2001.

Revenue in the Company's Canadian operations in the third
quarter of 2001 decreased versus the comparable period in 2000
as a result of modest price increases offset by reduced volume.
The Company's net loss for the three months ended September 30,
2001 was $ 2.5 million, as compared to the net loss in the same
quarter of 2000 of $ .7 million.


COHO ENERGY: Continues Sales Talks to Cure Borrowing Deficiency
---------------------------------------------------------------
Coho Energy, Inc. (OTCBB:CHOH) announced that its non-binding
letter of intent for the sale of its Mississippi oil and gas
assets, announced on September 14, 2001, expired pursuant to its
terms.

Although, discussions regarding the sale are continuing with the
third party that had executed the letter of intent, the Company
has reinitiated discussions with other potential purchasers of
the Company's oil and gas assets. The Company may not be able to
reach an agreement for the sale of its oil and gas assets, and
even if an agreement is reached, a sale may not be consummated.

On November 2, 2001, The Chase Manhattan Bank, as the
administrative agent under the Company's revolving credit
facility, notified the Company of a borrowing base deficiency as
of November 1, 2001 as a result of the redetermination of the
borrowing base to $175 million. Outstanding borrowings under the
credit facility are currently $195 million. Under the terms of
the credit facility, the Company must cure the borrowing base
deficiency within 90 days of receipt of the administrative
agent's notification. The Company intends to cure the borrowing
base deficiency by selling a portion of its oil and gas assets
and to apply the sales proceeds to reduce its outstanding
borrowings under the credit facility.  

The Company may not be able to consummate a sale or sales of a
portion of its oil and gas assets to cure the borrowing base
deficiency within the prescribed 90-day period in which case an
event of default under the credit facility would occur. The
Company intends to explore other available alternatives to avoid
a default under its revolving credit facility if the Company is
unable to cure the deficiency pursuant to a property sale.

Coho Energy, Inc. is a Dallas based oil and gas producer
focusing on exploitation of underdeveloped oil properties in
Oklahoma and Mississippi.


COMDISCO INC.: Court Allows Banks To File One Proof of Claim
------------------------------------------------------------
Comdisco, Inc. requested the Court's authorization to enter into
letter agreements with any or all of their pre-petition lender
groups to permit the agent of each bank group to file a single
proof of claim on behalf of the entire bank group.

The Bar Date Order requires each individual pre-petition lender
to file a proof of claim, George N. Panagakis, Esq., at Skadden,
Arps, Slate, Meagher & Flom, in Chicago, relates. However, Mr.
Panagakis tells Judge Barliant, requiring each of the pre-
petition lenders to file separate proofs of claim may be an
unnecessary burden to the Debtors and the pre-petition lenders
and will result in duplicate claims. According to Mr. Panagakis,
entering into agreements with the various bank groups that hold
claims in these cases to permit the filing of a master claim
will facilitate the processing of claims and ease this burden.
This procedure, Mr. Panagakis observes, will reduce any
unnecessary expense to the Debtors' estates that would be
incurred by requiring the pre-petition lenders to file and the
Debtors to review and reconcile multiple claims.

Mr. Panagakis explains that the proposed letter agreements will
require master claims to:

     (a) identify each pre-petition lender,
     (b) list the amounts owed to each pre-petition lender in
         the bank group, and
     (c) to identify the amounts owed by tranche, if applicable.

Upon filing of a master claim against a Debtor, Mr. Panagakis
continues, each pre-petition lender named therein, any successor
or assignee of any such pre-petition lender, shall be deemed to
have filed a proof of claim in the amount set in the master
claim in respect of its claims against the Debtors arising under
the relevant pre-petition credit agreement.

                       * * *

In granting the relief requested, Judge Barliant makes it clear
that the Debtors' decision to permit the filing of a Master
Claim is intended solely for the purpose of administrative
convenience. Judge Barliant further emphasizes that this order
and the Master Claim will not affect any substantive right of
any pre-petition lender, the Debtors, or any other party in
interest, including any right of each pre-petition lender:

     (a) to vote separately on any plan of reorganization
         proposed in the Debtors' chapter 11 cases, or

     (b) to receive separate distributions on account of its
         claims asserted in the master claim.

(Comdisco Bankruptcy News, Issue No. 13; Bankruptcy Creditors'
Service, Inc., 609/392-0900)    


CORAM HEALTHCARE: Shareholders Intend To Fight Plan
---------------------------------------------------
An added cash payout of up to $10 million hasn't placated the
equity committee in Coram Healthcare Corp.'s chapter 11 filing,
and shareholders plan to challenge a proposal that would hand
over ownership of the company to bondholders, according to The
Daily Deal.

On Monday at the U.S. Bankruptcy Court in Wilmington, Delaware,
the official equity committee took issue with an evaluation by
Goldin Associates Inc. (New York), which found Coram insolvent
and said its $252 million pre-filing debt exceeds its valuation.
If shareholders vote down the reorganization plan tabled by the
Denver-based Coram, management will seek court approval for it
anyway.

The company's disclosure statement in August included a
provision setting aside up to $10 million for shareholders, in a
bid to win their support. They will vote on the reorganization
plan on November 12. The first three days of hearings
challenging Coram's court-approved disclosure statement
kicked off Monday, as the equity committee seeks to undermine
two independent valuations - one by Goldin Associates and the
other by Chanin Capital Partners - which both concluded that
Coram's assets are worth less than its outstanding debt. The
hearings are scheduled to run until a confirmation hearing on
the reorganization plan on November 30 before Judge Mary
Walrath. (ABI World, November 6, 2001)


E.SPIRE COMMS: Asks Court to Stretch Exclusive Period to Jan. 31
----------------------------------------------------------------
e.spire Communications, Inc. moves to extend the exclusive
periods to file and solicit acceptances of its chapter 11 plan
to January 31, 2002 and April 1, 2002, respectively.

Originally, the Debtors' Plan Proposal and Solicitation Periods
were set to expire on July 20 and September 18, 2001. The Court
has already allowed the extension of the Plan Proposal Period to
October 19, 2001 and the Solicitation Period to December 19,
2001.

The Debtor explains that the size and complexity of the case
justifies the further extension of the Exclusive Periods
requested. In addition to handling administrative matters and
business complications that accompany the chapter 11 filing, the
Debtors have been working diligently and resolutely toward
developing, first, a business plan to serve as the cornerstone
of any plan of reorganization, and then a proposal for the
actual plan of reorganization. This process has been arduous and
time consuming given the size and complexity of the Debtors'
estates and the numerous creditor issues.

e.spire Communications, Inc. is a facilities-based integrated
communications provider, offering traditional local and long
distance dedicated internet access in 28 markets throughout the
United States. The Company filed for chapter 11 protection on
March 22, 2001 in Delaware Bankruptcy Court. Domenic E. Pacitti,
Esq., Maria Aprile Sawczuk, Esq. and Mark Minuti at Saul Ewing
LLP represents the Debtors in their restructuring effort.  


eNUCLEUS INC.: Emerges From Chapter 11 Bankruptcy
-------------------------------------------------
eNucleus, Inc. (NASDAQ OTC-BB: ENCSQ) announced that the
Company's Plan of Reorganization was confirmed by Robert E.
Ginsberg, Bankruptcy Judge, United States Bankruptcy Court for
the Northern District of Illinois, thereby enabling the Company
to successfully emerge from its Chapter 11 reorganization.

Pursuant to the confirmed Plan of Reorganization, creditors will
receive 1 share of common stock for every $3.00 of debt. Also
pursuant to the Plan, the Company's common stock has undergone a
1 for 6 reverse stock split resulting in current stockholders
receiving 1 share of new common stock for every 6 shares of old
common stock currently owned.

"The Company can now focus all of its attention and efforts to
expanding its business. The Company will also be making all
necessary filings to bring itself into compliance with the SEC
periodic reporting requirements." said John Paulsen, President
and CEO of eNucleus.


                     About eNucleus

Operating in Chicago and Atlanta, eNucleus (NASDAQ OTC-BB:
ENCSQ) helps growth-oriented middle-market companies innovate
and accelerate their business performance through a dynamic
solutions suite (eNucleus Powered Solution -"ePS"), dedicated
professionals and exceptional customer service, to achieve a
sustaining and scalable e-business capability linking business
processes, technology, client and partner communities.


EXODUS COMMS: Sprint Demands Adequate Assurance of Payment
----------------------------------------------------------
Exodus Communications, Inc. is a reseller of long distance
service and purchases other telecommunications services from
Sprint Communications Company L.P. pursuant to a Resale
Solutions Switched Services Agreement and other arrangements,
and then resell the Services to its customers. Pursuant to the
Agreement, the Debtors were indebted to Sprint and were past due
in its payment obligations owed in the amount of approximately
$1,873,251 pre-petition and continues to incur obligations for
the services approximately $937,979.45 per month.

Due to Sprint's normal billing practices, invoices for monthly
Services are typically mailed to ECI on the 15th day of the
month following the month in which the Services were provided.
Since the Filing Date, Sprint has continued to provide the
Debtor with the Services pursuant to the Agreement. Based on
these normal business practices, at any given time, Sprint's
credit exposure with ECI is for substantially in excess of 75
days of Services. Based on the average monthly usage of Services
set forth above, this credit exposure amounts to approximately
$2,344,948.62 at any given time.

By motion, Sprint Communications Company L.P. seeks the Court's
Order in:

A. Directing the Debtors to Provide Adequate Assurance of Future
       Performance;

B. Directing the Debtors to Assume or Reject Executory Contract;

C. Directing the Debtors to Provide Adequate Assurance of
       Performance as a Condition to Delaying Assumption of
       Executory Contract; or,
D. Granting Relief From the Automatic Stay to Permit Termination
       of Agreement.

Mark E. Felger, Esq., at Cozen O'Connor in Wilmington, Delaware,
claims that Sprint is a utility entitled to the adequate
protection while the Debtors is required to provide adequate
assurance of future performance to Sprint within 20 days of the
Filing Date. Mr. Felger submits that adequate assurance of
future performance in this case is the following:

A. an immediate cash deposit in the amount of $2,344,948.62;

B. alternatively, the Debtors shall make the payments to Sprint
       pursuant to these conditions:

       1. a payment to Sprint in the amount of $311,979.08
          immediately covering Services provided by Sprint to
          ECI for the period from the Filing Date through
          October 6, 2001;

       2. payment to Sprint on Wednesday, October 3, 2001 in the
          amount of $218,134.76 as a prepayment for Services to
          be provided for the period Sunday, October 10, 2001 to
          Saturday, October 13, 2001;

       3. a payment on Wednesday, October 10, 2001 and each
          Wednesday thereafter each in the amount of $218,134.76
          as prepayments for Services to be provided by Sprint
          to the Debtors for the week following the date of each
          of such payment;

       4. a payment within 5 days of receipt of the monthly
          invoice from Sprint equal to the difference between
          the Weekly Payments and the actual amount of Services
          provided by Sprint to the Debtors for the month that
          is the subject of the invoice;

       5. all such payments should be funded by wire transfer to
          Sprint pursuant to designated instructions from
          Sprint;

       6. billing disputes should be resolved pursuant to the
          terms of the Agreement;

       7. to the extent that the Debtors' usage of Services
          increases or decreases, Sprint shall notify the
          Debtors of the amount of such increase or decrease,
          and the Weekly Payment shall be recalculated and
          increased or decreased to account for the higher or
          lower usage of Services effective with the next
          payment due to Sprint. This new Weekly Payment shall
          be deemed to be the Weekly Payment subject to the same
          terms and conditions set forth above The parties are
          authorized to adjust the Weekly Payments to reflect a
          netting out of amounts owing by Sprint for its usage
          of the Debtors' services against the estimated amount
          of weekly usage by the Debtors of the Services;

       8. to the extent applicable, Sprint should be permitted
          to offset pre petition amounts owing by Sprint to the
          Debtors against pre-petition amounts that the Debtors
          owes to Sprint for services provided by Sprint to the
          Debtors.

C. the entry of an order directing that if ECI fails to timely
     make any payments due under the Agreement or perform any of
     the other terms and conditions set forth in the Agreement,
     Sprint shall have the right to terminate service to the
     Debtors immediately and without further order of the Court,
     and to the extent necessary, the automatic stay should be
     modified to permit Sprint to exercise such rights and
     remedies under the Agreement.

D. the entry of an order providing for the termination of
     Sprint's obligation to provide services on the earlier of
     the following:

       1. entry of an order approving any sale of all or
            substantially all of Debtors' assets that does not
            include the assumption and assignment of the
            Agreement,

      2. entry of an order converting any of Debtors' cases to a
            Chapter 7 liquidation or Chapter 11 trustee is
            appointed, or

      3. entry of an order dismissing any of Debtors' bankruptcy
            cases.

Alternatively, Mr. Felger relates that the Court should
immediately enter an order directing ECI to assume or reject the
Agreement as it constitutes an executory contract between Sprint
and the Debtors. Under the Agreement, Mr. Felger explains that
Sprint is providing substantial unsecured credit to the Debtors
since the Filing Date without any of the protections afforded to
a debtor-in-possession lender. Based on the harm to Sprint, Mr.
Felger contends that the Debtors should be directed to assume or
reject the Agreement immediately.

If the Debtors do not immediately assume or reject the
Agreement, Mr. Felger believes that Sprint is entitled to
assurances that the Debtors will make payments under the
Agreement. Absent the commencement of this bankruptcy case, Mr.
Felger argues that Sprint had the right under the Agreement and
applicable law to require ECI to provide adequate assurance of
payment, such as the protections set forth. In light of the
magnitude of unsecured credit provided by Sprint in this
bankruptcy case, Sprint submits that during the period of time
that the Debtors is determining whether to assume or reject the
Agreement, the protections should be afforded to Sprint. In the
absence of the protections being afforded to Sprint, Mr. Felger
asserts that cause exists to modify the automatic to permit
Sprint to terminate the Agreement immediately. (Exodus
Bankruptcy News, Issue No. 5; Bankruptcy Creditors' Service,
Inc., 609/392-0900)


EXODUS COMMUNICATIONS: Court Okays $200 Million DIP Financing
-------------------------------------------------------------
Exodus Communications Inc. received approval for a $200 million
debtor-in-possession (DIP) financing agreement with lenders led
by General Electric Co.'s General Electric Capital Corp.,
according to Dow Jones.

Exodus said it would use the DIP loan to fund operations and
assure vendors, customers and employees of its long-term
viability. The order, signed by Chief Judge Sue L. Robinson of
the U.S. Bankruptcy Court in Wilmington, Delaware, provides a $2
million carve-out for professional fees and expenses incurred
during the web-hosting company's time in chapter 11.

Prior to Monday's hearing, Exodus resolved objections filed by
several landlords who feared their liens would be secondary to
the DIP lenders. The landlords also expressed concern that
Exodus, and possibly the DIP lenders, may try to escape from
their obligations under the leases under certain circumstances,
such as the events of default under the DIP. The majority of the
objections were withdrawn after Exodus agreed to add language in
the order stating that all liens given to the DIP lenders are
junior to existing liens. Exodus is seeking bankruptcy court
approval to sell some of its California real estate and related
assets for $14.3 million, subject to higher offers.

Exodus said that in addition to providing cash for its
reorganization, the proposed sale would free it from having to
maintain a portion of the property that is no longer needed for
operations. Exodus will lease back from the buyer the part of
the property that has one of its Internet data centers. A
hearing on the matter has yet to be scheduled. Exodus, which
filed for chapter 11 bankruptcy protection on September 26,
listed consolidated assets of $5.99 billion and liabilities of
$4.45 billion as of June 30. (ABI World, November 6, 2001)


FAIRFAX FINANCIAL: S&P Drops Senior Debt Rating to BB+ From BBB-
----------------------------------------------------------------
Fitch lowered the senior debt rating of Fairfax Financial
Holdings Ltd. to `BB+' from `BBB-` following Fairfax's
announcement of gross reserve strengthening of US$600 million in
third quarter 2001, primarily emanating from its Crum & Forster
(C&F) and TIG Specialty (TIG) insurance units.

Approximately US$190 million of the charge is covered by
indemnities provided to C&F at the time of its acquisition by
Fairfax, and the net charge after indemnities and reinsurance is
US$187 million.

Fitch also affirmed the insurer financial strength (IFS) ratings
of Fairfax's majority owned Odyssey Re Group at `A- `, while
lowering the IFS ratings of Fairfax's wholly owned primary
insurance company subsidiaries to `BBB+' from `A-`. The Rating
Outlook for all entities is Stable, and all ratings have been
removed from Rating Watch Negative.

Fitch originally placed the ratings of Fairfax and its
subsidiaries on Rating Watch Negative in May 2001 due to various
operational and underwriting concerns. Subsequently, on August
2, 2001 Fitch announced an industry-wide review of commercial
lines insurance company loss reserve adequacy. This review
included Fairfax, and the reserve strengthening announced by
Fairfax in third quarter, which was driven primarily by
deficiencies on the 1998-2000 accident years on U.S. commercial
business, was consistent with the findings of Fitch's review.

The downgrades primarily reflect Fitch's belief that the
reserving and balance sheet profiles at the statutory level of
C&F and TIG have proven to be weaker than Fitch had anticipated
at the time of acquisition. Loss reserve development at these
companies has exceeded indemnities provided by former owners at
the time of acquisition. Fitch believes the addition of TIG and
C&F has weakened Fairfax's credit profile to levels reflective
of the current ratings.

A significant portion of the losses to statutory and GAAP
capital at the operating company level from the reserve
strengthening are being funded by finite risk reinsurance
contracts (including both existing prospective contracts and
recently purchased retrospective contracts). Fitch believes
that finite risk reinsurance provides a weak form of capital
enhancement from an economic perspective, but recognizes that it
provides accounting protection.

Fairfax has taken significant steps to bolster the holding
company balance sheet following the reserve strengthening,
including an equity issuance completed earlier today. Further,
Fairfax has raised its target of holding company cash from C$500
million to C$800 million. Fitch is encouraged that these actions
have stabilized Fairfax's ratings, which have been lowered
several times in recent years.

Fitch also recognizes that the current books of business written
by TIG and C&F under new management appear to be much stronger
than the books inherited by Fairfax as part of the acquisitions,
with better underwriting controls and discipline. Fairfax and
its subsidiaries should also be beneficiaries of the hard market
resulting from the September 11 events. Fitch believes Fairfax's
earnings outlook in 2002 and 2003 is much improved relative to
prior years.

The affirmation of the Odyssey Re ratings reflects improved
underwriting performance over the past several years. The
affirmation also reflects Fitch's belief that following its
initial public offering of 26% of its shares earlier this year,
Fairfax will maintain a strong balance sheet within Odyssey, and
will be less likely to view Odyssey as a source of capital, if
needed.

      Entity/Issue/Type        Action      Rating      Outlook

Fairfax Financial Holdings, Ltd.

   * Senior debt               Downgrade    BBB- to BB+ Stable

Members of The Fairfax Primary Insurance Group

  * Insurer financial strength Downgrade    A- to BBB+  Stable

Members of the Odyssey Re Group

  * Insurer Financial Strength   Affirm     A-          Stable

The members of the Fairfax Primary Insurance Group are: TIG
Insurance Company, Fairmount Insurance Company, TIG American
Specialty Ins. Company, TIG Indemnity Company, TIG Insurance
Company of Colorado, TIG Insurance Company of New York, TIG
Insurance Company of Texas, TIG Insurance Corporation of
America, TIG Lloyds Insurance Company, TIG Premier Insurance
Company, TIG Specialty Insurance Company, Industrial County
Mutual Insurance Co., Commonwealth Insurance Co., Commonwealth
Insurance Co. of America, United States Fire Insurance Co., The
North River Insurance Co., Crum & Forster Insurance Co., Crum &
Forster Underwriters of Ohio, Crum & Forster Indemnity Co.,
Lombard General Insurance Co. of Canada, Lombard Insurance
Co., Zenith Insurance Co. (Canada), Ranger Insurance Co.,
Federated Insurance Co. of Canada and Markel Insurance Co. of
Canada

The members of the Odyssey Re Group are: Odyssey Reinsurance
Corp., Compagnie Transcontinentale De Reassurance, Odyssey
America Reinsurance Corp. and ORC Re Ltd. (Ireland).


FEDERAL-MOGUL: Hiring Dykema & Gossett as Special Counsel
---------------------------------------------------------
David Sherbin, Federal-Mogul Corporation's Vice President and
Deputy General Counsel relates that Dykema & Gossett PLLC have
represented certain of the Debtors over the past 13 years with
respect to a variety of general corporate and transactional
issues, including antitrust, contract, employee benefit,
environmental, litigation, real estate, regulatory, securities
and tax issues. Through their representation of these Debtors,
Dykema attorneys have become uniquely and thoroughly familiar
with the Debtors and their business affairs, especially those
related to the automotive industry and the Debtors' automotive
suppliers and customers. Mr. Sherbin believes that the continued
representation of the Debtors by Dykema, in connection with
their general corporate issues arising in or related to the
ordinary course of their business, is essential to the Debtors'
successful reorganization and will provide a substantial benefit
to the Debtors, their estates and their creditors. The Debtors
anticipate that Dykema will provide the litigation and
transactional support required by the Debtors in connection with
their general corporate matters.

By application, the Debtors seek authorization to employ and
retain Dykema Gossett PLLC as its special corporate counsel in
their chapter 11 cases.

James J. Zamoyski, the Debtors' Senior Vice President and
General Counsel, anticipates that Dykema will provide these
services to the Debtors:

A. advising the Debtors and assisting the Debtors' general
   bankruptcy counsel in connection with any contemplated
   divestitures, sales of assets or business combinations
   relating to the Debtors Camshaft and Lighting Groups,
   including:

    1. the negotiation of asset, stock purchase, merger or joint
        venture agreements;
    2. formulation of bidding procedures;
    3. evaluating competing offers;
    4. drafting of appropriate corporate documents with respect
        to proposed divestitures, sales or combinations; and
    5. counseling the Debtors in connection with the closing of
        such divestitures, sales or combinations.

B. assisting Sidley in advising the Debtors on matters relating
   to the evaluation of the assumption, rejection or assignment
   of unexpired leases and contracts;

C. advising the Debtors and assisting Sidley in various
   bankruptcy litigation matters and other creditors' rights
   issues, whether in connection with court proceedings or
   including preference actions and other proceedings in which
   any of the Debtors is a creditor;

D. advising and representing the Debtors concerning certain
   strategic issues related to the automotive industry,
   including automotive supplier issues and customer issues
   relating to original equipment manufacturers and aftermarket
   customers;

E. providing non-bankruptcy advice to the Debtors and assisting
   Sidley with respect to legal issues arising or related to
   the Debtors' ordinary course of business, including
   attendance at senior management meetings, meeting with the
   Debtors financial and legal advisors, and advising the
   Debtors on various antitrust, contract, corporate, employee
   benefits, environmental, litigation, real property,
   regulatory, securities and tax matters.

F. lobbying and engaging in related public affairs and
   regulatory matters at the local, state and nationwide levels
   on behalf of the Debtors;

G. advising the Debtors and assisting Sidley with respect to
   continuing disclosure and reporting obligations under
   securities laws;

H. attending meetings with third parties and participating in
   negotiations with respect to the above matters;

I. representing the Debtors at hearing to be held before this
   Court, any arbitration or mediation panels and the U.S.
   Trustee with respect to these matters;

J. rendering such other services that may be in the best
   interests of the Debtors in connection with the foregoing;

Mr. Zamoyski, tells the Court that Dykema has agreed to be
compensated on an hourly basis plus reimbursement for all costs
and expenses incurred in these cases. The current hourly rates
of Dykema are:

      Attorneys               $135 to $355 per hour
      Para-professionals       $95 to $150 per hour

Mr. Zamoyski informs the Court that Dykema has received
$250,721.89 in retainers for the firm's representation of the
Debtors in various pre-petition corporate matters, a portion of
which was applied to the Debtors' outstanding balances. Mr.
Zamoyski states that the remainder of approximately $193,000,
which shall constitute as a retainer for future post-petition
services.

Aleksandra A. Miziolek, an equity member of Dykema, states that
the firm has conducted a series of searches of its records to
identify relationships with creditors and other parties, and
noted these discoveries:

A. joint representation of defendants, including the Debtors, in
   two environmental litigation in Super Fund and Allworth
   sites;

B. Represented defendants in asbestos related representations,
   including the Detroit Public School Management Team, Auto-
   Owners Insurance Company, The Walworth Company, BP
   Amoco/Standard Oil, Rex Roto, General Motors Corporation,
   Connell Industries L.P., SECO/Warwick, Fuller Company, U.S.
   Gypsum, Delphi Automotive, NBA-Shell Oil.

C. Represented in unrelated matters institutional lenders to the
   Debtors including ABN Amro Bank NV, Bank of America, Credit
   Suisse First Boston, Citicorp, Putnam Diversified Income
   Trust, SPS High Yield Loan Trading, Societe Generale,
   Natinal City Bank, Bear Sterns & Co., Mitsubishi Trust &
   Banking Corp., Comerica Bank, Goldman Sachs Credit Partners,
   LP, and Bank One.

D. Representation in unrelated matters members of the 20 largest
   unsecured creditors including Cummins, Leggett & Platt, Inc.,
   General Electric Company.

E. Representation in unrelated matters to the Debtors' major
   customers, including Caterpillar, Cummins, Daimler Chrysler,
   Renault, General Motors Corporation, Ford Motor Company,
   Fiat, AutoZone and Advance.

F. Representation in unrelated matters insurers of the Debtors,
   including ACE Insurance Company Ltd., AIG, Marsh USA Inc.,
   AON Risk Services, Swiss Re, Liberty Mutual, Travelers
   Property Casualty, Chubb Insurance Group.

G. Represents APS, a party with significant litigation with the
   Debtors, in unrelated matters.

H. Represents in unrelated matters PricewaterhouseCoopers LLP,
   one of the professionals retained by the Debtors.

(Federal-Mogul Bankruptcy News, Issue No. 4; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


FIRSTPLUS FINANCIAL: Freedom Commercial Acquires Majority Stake
---------------------------------------------------------------
FIRSTPLUS Financial Group, Inc. (Pink Sheets: FPFX) says it is
forming a residual trust for the benefit of its shareholders and
creditors and has acquired twenty-five percent of the
outstanding limited liability company interests of Freedom
Commercial Credit LLC.  The acquisition was in exchange for
25,000 shares of a new series of convertible preferred stock of
FIRSTPLUS and cash in the amount of $250,000, subject to
adjustment based on a final valuation of Freedom Commercial
Credit.  The preferred stock is convertible into 45,000,000
shares of FIRSTPLUS' common stock at the option of Freedom
Commercial Credit on or after the first anniversary date of the
issuance of the preferred stock, but votes with the common stock
prior to conversion.  As a result of the foregoing transaction,
Freedom Commercial Credit acquired control of FIRSTPLUS and now
holds approximately 51% of the outstanding voting securities of
FIRSTPLUS.  Also as a result of the foregoing transaction,
Freedom Commercial Credit has the right to replace management
and the board of directors of FIRSTPLUS.

In addition, the terms of the preferred stock provide that
neither Freedom Commercial Credit nor any of its affiliates and
assigns will be entitled to any of FIRSTPLUS' rights in the cash
flow from the derivative interests in mortgage-backed or asset-
backed securitization transactions ("Residuals") of FIRSTPLUS
Financial, Inc. ("FPFI").  The transaction was based upon an
independent third-party valuation of FIRSTPLUS, excluding any
cash flow rights from the Residuals.  Consequently, the
appraiser determined that there was no remaining net value in
FIRSTPLUS.

As previously disclosed, FIRSTPLUS' then main operating
subsidiary, FPFI, filed for reorganization under Chapter 11 of
the United States Bankruptcy Code on March 5, 1999.  On May 10,
2000, the bankruptcy plan for FPFI closed.  The Plan, as
approved, was initially filed on July 2, 1999 with the United
States Bankruptcy Court, Northern District of Texas, Dallas
Division. In connection with the Plan, a trust was formed in
order to facilitate implementation of the Plan, into which the
assets of FPFI, including the stock of FPFI owned by FIRSTPLUS,
were transferred for the benefit of the creditors of FPFI,
including FIRSTPLUS.  As a result, FIRSTPLUS no longer owns
FPFI, but as a creditor of FPFI through its intercompany claim,
it is a beneficiary of the FPFI Trust, last in line behind the
other creditors.

As a beneficiary of the FPFI Trust, FIRSTPLUS' only significant
asset is an instrument representing its portion of the cash flow
rights from the Residuals held by the FPFI Trust.  The Residuals
are illiquid (and encumbered) and may not produce cash flow to
the FPFI Trust for many years, if ever.  In any event, the first
cash flows from the Residuals are committed to funding a portion
of the monies owed to Plan creditors.  Contrary to public
speculation, FIRSTPLUS has not received any cash flows from the
Residuals through its cash flow instrument.

The terms of the preferred stock provide that neither Freedom
Commercial Credit, nor any of its affiliates or assigns, are
entitled to any of the cash flow from the Residuals.  The cash
flow instrument to FIRSTPLUS will be set aside in a trust.  The
beneficiary of the Residual Trust is FIRSTPLUS, for the benefit
of its shareholders and creditors, but excluding Freedom
Commercial Credit and its affiliates and assigns.  The Residual
Trust will be formed by FIRSTPLUS and managed by a trustee
appointed by FIRSTPLUS.  During the term of the Residual Trust,
the trustee will distribute to FIRSTPLUS all of the net income
from the Residual Trust.

Freedom Commercial Credit is a Utah limited liability company,
which, following the transaction, is owned 75% by New Freedom
Mortgage Corporation. It is in the business of buying,
repackaging and selling mortgage loans.

As previously disclosed, FIRSTPLUS has no operating business and
it is unlikely that FIRSTPLUS will reconstitute any of its
previous business plans, such as originating mortgage loans,
servicing mortgage loan portfolios, or investing in mortgage
loan portfolios and interest only strips.


FREDERICK'S: Likely To File Chapter 11 Plan After the Holidays
--------------------------------------------------------------
Lingerie retailer Frederick's of Hollywood Inc. will most likely
wait until after the holiday season to submit a chapter 11
reorganization plan with the bankruptcy court, company attorney
David A. Fidler told Dow Jones.

The company will probably delay formulating a plan so it can
concentrate on holiday sales and then evaluate results from the
season, Fidler said.

In September, the U.S. Bankruptcy Court in Los Angeles
authorized Frederick's to sign a letter of intent under which it
would sell its assets under a reorganization plan. The letter
calls for Newco, a newly formed entity organized by TGV Partners
and Cerberus Capital Management LP, to purchase substantially
all of the lingerie retailer's assets for $15 million in cash,
10 percent of the fully diluted common stock of Newco, and
warrants for an added 10 percent of Newco's shares.

On October 25, Judge Ernest M. Robles of the Los Angeles court
granted the company a further extension of the exclusive periods
in which only the company may file a chapter 11 plan and solicit
that plan's acceptance. Under the extension, the lingerie
retailer now has until December 3 to file a plan without the
threat of competing plans. If Frederick's were to file a plan by
that date, other entities would be further prohibited from
filing competing plans through February 4, while the company
collects votes for its plan. Without the extension, the
company's exclusive plan-filing period would have expired last
Friday.

The Hollywood, California-based retailer filed for chapter 11
bankruptcy protection July 10, 2000, listing assets of $66
million and liabilities of about $67 million. (ABI World,
November 6, 2001)


GC COMPANIES: Seeks To Extend Lease Decision Period To Jan. 31
--------------------------------------------------------------
GC Companies, Inc. (GCX) requests the Bankruptcy Court of the
District of Delaware to extend the time by which the Debtors
must assume or reject certain unexpired leases of nonresidential
real property until January 31, 2002.

The Debtors need more time to complete the process of
negotiating with the bidders and consult with the winning bidder
to determine whether to assume or reject each of the Leases.

A hearing on the motion will be held on December 20, 2001 at
11:30 a.m. at the United States District Court for the District
of Delaware if there are any objections regarding this motion.

GC Companies, which operates about 80 movie theaters in 19
states and the District of Columbia, filed for chapter 11
protection on October 11, 2000 in the U.S. Bankruptcy Court for
the District of Delaware. The firm is represented by Aaron A.
Garber, Esq., at Pepper Hamilton LLP. The company's 10Q Report
filed with the SEC lists assets of $232,595,000 and liabilities
of $249,179,000 as of July 31, 2001.


HERCULES: Exchange Offer & Withdrawal Rights To Expire On Dec. 7
----------------------------------------------------------------
Hercules, Inc., in its Exchange Offer for $400,000,000 of its
11-1/8% Senior Notes Due 2007 has advised that the Offer and
Withdrawal Rights will expire at 5:00 P.M., New York City time,
on December 7, 2001, unless extended.

If all of the conditions to the exchange offer are satisfied,
Hercules will exchange all of its 11-1/8% Senior Notes due 2007
issued on November 14, 2000, which the Company refers to as the
old notes, that are validly tendered and not withdrawn prior to
the expiration of the exchange offer, for 11-1/8% Senior Notes
due 2007, which the Company refers to as the new notes.

Holders of the notes may withdraw tender of old notes at any
time before the expiration of the exchange offer.

The new notes that are issued in exchange for the old notes will
be substantially identical to the old notes except that, unlike
the old notes, the new notes will not have certain transfer
restrictions or registration rights.

The new notes that are issued in exchange for the old notes are
new securities with no established market for trading.


HMG WORLDWIDE: Gets Interim Court Nod For DIP Financing Pact
------------------------------------------------------------
Judge Stuart M. Bernstein of the U.S. Bankruptcy Court in
Manhattan has granted HMG Worldwide Corp. interim approval for a
debtor-in-possession (DIP) financing agreement with its pre-
petition lenders, Dow Jones reported.

PNC Bank N.A. and Firstar Bank N.A., with PNC as agent, have
agreed to provide DIP financing. Judge Bernstein signed an
interim order last Thursday that allows HMG to get loans through
a final DIP hearing November 14.

New York-based HMG creates in-store advertising displays. It
filed for chapter 11 bankruptcy protection late last month,
listing $34.5 million in assets and $61.9 million in
liabilities. (ABI World, November 6, 2001)


HOUSE2HOME INC: Ratings Fall to D After Missed Interest Payment
---------------------------------------------------------------
Standard & Poor's lowered its corporate credit rating on
House2Home Inc. to 'D' from triple-'C' and lowered its
subordinated debt rating to 'D' from double-'C'.

The rating action follows the company's announcement that it did
not make the semi-annual interest payment, due November 1, 2001,
on its 5.25% convertible subordinated notes. The company has
been experiencing significant sales declines since the September
11, 2001, terrorist attacks, which have pressured the company's
cash position.

As a result, the company is exploring strategic and financial
alternatives. House2Home has attempted to convert itself to a
home furnishings concept from a home improvement format over the
past year, in response to increased competitive pressures from
Home Depot Inc. and Lowe's Cos. Inc.


HOUSE2HOME INC: Files Chapter 11 Petition in Santa Ana, Calif.
--------------------------------------------------------------
House2Home, Inc. (NYSE:HTH) announced that the company and its
subsidiaries filed voluntary petitions under Chapter 11 of the
Federal Bankruptcy Code. The filings were made in the U.S.
Bankruptcy Court in Santa Ana, California. The company intended
to file a motion Wednesday requesting Bankruptcy Court
authorization to liquidate and cease operating all 42 of its
House2Home home decorating superstores.

As previously reported, sales for the company's 42 House2Home
stores fell severely following the tragedy of the September 11
terrorist attacks, exacerbating an already difficult retail
environment. The company previously reported that second quarter
sales for the current year were lower than originally expected,
due to moderating growth in the economy and diminishing consumer
confidence. The continuing sales decline subsequent to September
11 led to extreme pressure on the company's cash position.

"The dramatic and sustained drop in sales that immediately
followed the terrorist attacks put an extraordinary strain on
cash flow, from which we could not recover," said Herbert
Zarkin, chairman and chief executive officer. "We had high hopes
for House2Home and still believe that the concept would have
been successful under different macro economic circumstances.
Unfortunately, several pivotal external factors were working
against us. At the time of the September 11 attacks, our
borrowings against our credit facility were approaching their
peak level with the August completion of the conversion program.
This also meant the vast majority of our House2Home stores had
been open a very short time prior to the September 11 attacks.
We never had the opportunity to build a solid customer base that
might have otherwise sustained the business through a difficult
period. Finally, all of this took place against the backdrop of
a softening economy."

In August of this year, the company completed its corporate
transition into the home decorating market, following the
competitive difficulties it was facing as a home improvement
retailer. The chain-wide conversion, which was based on a
successful five-store House2Home pilot program, involved closing
all of its 89 former HomeBase home improvement warehouses and
converting 42 of those stores into House2Homes.

Zarkin added, "Although this was a wrenching decision, our board
of directors believes that, with no other viable strategic
alternatives, a complete liquidation of operations is the only
course of action available to us at this time. The plan we
intend to file, which is subject to Court approval, will call
for the immediate and simultaneous liquidation of all 42 stores.
We would like to act quickly in order to take advantage of the
holiday selling season and move toward a swift resolution."

The company also noted that it has reached an agreement with its
bank group, led by Fleet Retail Finance, with respect to a cash
collateral stipulation. The anticipated stipulation, which will
be subject to Bankruptcy Court approval, will enable the company
to retain a predetermined portion of cash from anticipated store
liquidation sales. The company expects to use these funds to
help fulfill obligations associated with all business
operations, including payments to employees, suppliers, vendors
and other business partners for goods and services provided on
or after the Chapter 11 filing date. Once commenced, liquidation
of inventory at the 42 stores is estimated to take approximately
13 weeks.

Prior to Wednesday's action, the company had retained the
services of Barrington Associates, a Los Angeles-based
investment banking firm, to help explore various strategic
alternatives. Despite intense efforts, no viable strategic
transaction has materialized to date that would permit the
company to avoid liquidation.

The company added that it would retain some portion of its
employees through the completion of the liquidation process. No
further details were available concerning the timing of employee
terminations. The company currently employs approximately 4,700
people, including employees at its 42 stores and at its Irvine,
California, corporate office.

Sales for the third fiscal quarter, ended October 27, 2001, are
expected to total approximately $119 million. The company
expects to report third quarter financial results in mid to late
November.

The Chapter 11 petition for the company was filed Wednesday
morning in the U.S. Bankruptcy Court for the Central District of
California, Santa Ana Division. The case number is SA01-19244-
JB. The assigned judge is the Honorable James Barr.

Headquartered in Irvine, California, House2Home, Inc. operates
42 House2Home home decorating superstores in three western
states. Averaging more than 100,000 square feet, House2Home
stores offer an expansive selection of specialty home decor
merchandise across four broad product categories -- outdoor
living, indoor living, home decor and accessories, and seasonal
goods. For more information about the company and its stores,
visit the House2Home web site at  http://www.house2home.com


INTEGRATED BUSINESS: Shares Face Nasdaq Delisting
-------------------------------------------------
On October 30, 2001, Integrated Business Systems & Services,
Inc. the Company received a Nasdaq Staff Determination that the
Company fails to comply with the minimum market capitalization
requirement for continued listing set forth in the Nasdaq
Marketplace Rule 4450(b)(1)(A).

Consequently, the Company's common stock is subject to delisting
from the Nasdaq National Market, in which event the Company
intends to apply to transfer its listing to the Nasdaq SmallCap
Market. As permitted by Nasdaq, the Company has filed its
request for a hearing before the Nasdaq Listing Qualifications
Panel to review the Staff Determination, and will present the
Panel with the Company's plan for continued Nasdaq National
Market compliance.

There can be no assurance that the Qualifications Panel will
grant the Company's request for continued listing. However,
pending the final decision of the Qualifications Panel, the
Company's securities will continue to trade on the Nasdaq
National Market. Should the Qualifications Panel fail to grant
the Company's request for continued listing on the Nasdaq
National Market, the Company intends to transfer its listing to
the Nasdaq SmallCap Market.

IBSS, incorporated in 1990, is a national provider of
infrastructure, turnkey software that enables companies to
manage in real-time every aspect of their operations from
customer order entry through shipping. The Company's flagship
product, Synapse Manufacturing is designed to track and schedule
each process of the manufacturing operation and to efficiently
capture real-time data required for effective management. It is
the easy and rapid installation, low maintenance and versatility
of the Synapse software that allows Synapse users to realize a
true competitive advantage. The IBSS line of Synapse-based
products includes Synapse Manufacturing for manufacturing plant
automation; Synapse EAI+ for enterprise modeling and application
integration; and Synapse ASP for ASP enablement. IBSS has
offices in Columbia and Detroit. For more information about
IBSS' technology and services, visit http://www.ibss.net


LOEWEN GROUP: Retains Bordelon Hamlin as Special Counsel
--------------------------------------------------------
The Loewen Group, Inc. sought and obtained the Court's authority
to retain and employ Bordelon, Hamlin & Theriot as special
counsel in their chapter 11 cases, pursuant to section 327(e) of
the Bankruptcy Code and Bankruptcy Rule 2014, with respect to
certain matters arising in the State of Louisiana, including
corporate, employee benefits, intellectual property, real
estate, litigation and regulatory matters arising under United
States and Louisiana law.

Bordelon is a New Orleans, Louisiana-based law firm of
approximately seven lawyers. Bordelon has provided a variety of
legal services to the Debtors since 1998 with respect to
corporate, employee benefits, intellectual property, real
estate, litigation and regulatory matters arising in the State
of Louisiana.

For the four-month period from October 1, 2000 through January
31, 2001, Bordelon was employed and retained by the Debtors as
an Ordinary Course Professional with respect to certain legal
matters arising in the State of Louisiana. Bordelon and certain
other Ordinary Course Professionals were on average paid in
excess of the cap of $25,000 per month for services rendered to
the Debtors.

The Debtors attempted to seek an order removing the $25,000 per
month cap on payments to Ordinary Course Professionals but the
United States Trustee interposed. The Modification Motion and
the Objection were subsequently resolved on the terms set forth
in the Modification Order submitted to the Court. Under the
Modification Order, the subject professionals -- (i) Bordelon,
(ii) Hamlin & Theriot, (iii) Butzel Long, and (iv) Wyatt,
Tarrant & Combs -- are required to file retention applications
pursuant to section 327 of the Bankruptcy Code. Moreover, the
fees and expenses incurred by Bordelon on and after August 1,
2001 are subject to review by the Court, the United States
Trustee and interested parties pursuant to the interim and final
fee application procedures applicable to other estate
professionals in the Loewen chapter 11 cases. Bordelon, however,
is not required to file fee applications with respect to
attorneys' fees and expenses incurred prior to August 1, 2001.

               Services to Be Provided by Bordelon

Pursuant to this motion, which has been authorized by the Court,
Bordelon will perform, among others, the following legal
services relating to matters arising in Louisiana:

(a) review and analyze the nature and validity of all liens
    asserted against real and personal property in the State of
    Louisiana of the Debtors and nondebtor affiliates of the
    Debtors (collectively, the "Louisiana Property") with
    respect to the enforceability of these liens;

(b) advise the Debtors regarding litigation matters relating to
    the Louisiana Property;

(c) advise and assist the Debtors in connection with any
    potential dispositions of the Louisiana Property;

(d) advise the Debtors concerning executory contract and
    unexpired lease matters that are subject to Louisiana law;

(e) assist the Debtors in reviewing, estimating and resolving
    claims with respect to subject matter in the State of
    Louisiana, and representing the Debtors in litigation and
    arbitration conducted in the State of Louisiana with respect
    to these claims;

(f) commence and conduct litigation in the State of Louisiana as
    necessary or appropriate to assert rights held by the
    Debtors;

(g) provide general corporate, employee benefits, litigation and
    other nonbankruptcy services to the Debtors comparable to
    those services provided prior to the Petition Date or as an
    Ordinary Course Professional.

The Debtors require knowledgeable counsel to render these
essential professional services. The Debtors believe that
Bordelon is particularly well-suited for the type of
representation required by the Debtors. Bordelon's lawyers have
substantial experience representing large corporations in the
State of Louisiana with respect to corporate, employee benefits,
intellectual property, real estate, litigation and regulatory
matters arising under United States and Louisiana law. Bordelon
is well qualified to provide the services requested. Bordelon
has also worked closely with the Debtors' management and has
developed significant relevant experience and expertise
regarding the Debtors that will assist it in providing effective
and efficient services to the Debtors in the State of Louisiana.

                  Payment of Fees and Expenses

Subject to the Court's approval, Bordelon intends to:

(a) continue, as has been its practice, to charge the Debtors
    for its legal services on an hourly basis in accordance with
    its ordinary and customary hourly rates in effect on the
    date services are rendered; and

(b) seek reimbursement of actual and necessary out-of-pocket
    expenses.

Bordelon's hourly rates may change from time to time in
accordance with Bordelon's established billing practices and
procedures. These rates also differ based on, among other
things, the professional's level of experience.

Ms. Regina Scotto Wedig, an attorney and a member of Bordelon,
supplied the names of Bordelon and the hourly rates for their
services as of September 1, 2001:

   Professional             Position               Hourly Rate
------------------   ----------------------     --------------
Alvin J. Bordelon     Partner/litigation         $ 195.00/hour

William J. Hamlin     Partner/litigation,        $ 195.00/hour
                       general business,
                       and regulation

Donald E. Theriot     Partner/litigation         $ 195.00/hour

Regina S. Wedig       Partner/litigation,        $ 185.00/hour
                       general business,
                       and litigation

William C. Ellison    Partner/litigation         $ 185.00/hour

Joell M. Keller       Associate/litigation       $ 175.00/hour

Paul D. Hesse         Associate/litigation       $ 175.00/hour

Bordelon intends to apply to the Court for payment of
compensation and reimbursement of expenses in respect of
services provided from and after August 1, 2001, in accordance
with applicable provisions of the Bankruptcy Code, the
Bankruptcy Rules, the Local Rules of this Court, the interim and
final fee application procedures applicable to other estate
professionals in these chapter 11 cases and any other applicable
orders of the Court.

The Debtors made Prepetition Payments to Bordelon in the
aggregate amount of $144,464.32 during the year immediately
preceding the Petition Date on account of fees and expenses
incurred by Bordelon in respect of services provided to the
Debtors. The source of the Prepetition Payments was the Debtors'
operating cash funds.

Since the Petition Date, the Debtors have made payments to
Bordelon in its capacity as an Ordinary Course Professional in
the aggregate amount of $363,192.98 on account of fees and
expenses incurred by Bordelon prior to August 1, 2001 in respect
of services provided to the Debtors.

          Disclosure Concerning Conflicts of Interest

The Debtors represent that, to the best of their knowledge,
information and belief, in reliance, upon the Affidavit and the
Disclosure of Compensation of Ms. Wedig, other than in
connection with these cases, Bordelon has no connection with the
Debtors, their creditors, the United States Trustee or any other
party with an actual or potential interest in these chapter 11
cases or their respective attorneys or accountants, except that:

       -- Bordelon represents the Debtors' liability insurance
carrier, the CNA Insurance Companies, in litigation in Louisiana
covered by CNA's insurance policies with the Debtors. Bordelon
anticipates that it will continue providing services to CNA in
matters in which CNA is a named co-defendant with the applicable
Loewen entities. Bordelon, however, does not and does not intend
to represent CNA in any matters in which CNA is adverse to the
Debtors or in any matters relating to the Debtors' chapter 11
cases.

       -- Bordelon has represented, and likely will continue to
represent, certain creditors of the Debtors and various other
parties adverse to the Debtors in matters unrelated to these
chapter 11 cases.

       -- Bordelon has represented certain of the Debtors'
nondebtor affiliates in matters unrelated to these chapter 11
cases. For example, Bordelon has provided general corporate,
regulatory and litigation services to nondebtor affiliates
Advance Planning of Louisiana, Inc., Mayflower National Life
Insurance Company, New Orleans Limousine Service, Inc., Security
Plan Life Insurance Company, Security Plan Fire Insurance
Comapny and others. Bordelon anticipates that it will continue
providing services to such nondebtor affiliates in connection
with pending and future matters unrelated to these chapter 11
cases;

       -- It is possible that certain of Bordelon's 12 employees
or 5 partners hold interests in mutual funds or other investment
vehicles that may own debt or equity interests in the Debtors.

To the best of the Debtors' knowledge, information and belief,
Bordelon represents no interest adverse to the Debtors or their
respective estates in the matters for which Bordelon is proposed
to be retained.

The Debtors recognize that, despite the efforts in researching
its client database for the past three years to identify and
disclose Bordelon's connections with Interested Parties on the
29-page list provided by the Debtors, Bordelon is unable to
state with certainty that every client representation or other
connection has been disclosed, given that the Debtors are a
multinational enterprise with thousands of creditors and other
relationships.

Ms. Wedig covenants that, if Bordelon discovers additional
information that requires disclosure, Bordelon will file a
supplemental disclosure with the Court as promptly as possible.

Ms. Wedig declares that the proposed employment of Bordelon is
not prohibited by or improper under Bankruptcy Rule 5002, based
on what is known.

The Debtors submit that their employment of Bordelon would be in
the best interests of the Debtors and their respective estates
and creditors. (Loewen Bankruptcy News, Issue No. 48; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


LTV STEEL: Agrees with USWA to Expand Retirement Opportunities
--------------------------------------------------------------
The United Steelworkers of America (USWA) and LTV Steel agree to
expand retirement opportunities for steelworkers at the
company's Cleveland West facility as part of an Amendment to the
current Modified Labor Agreement. The Amendment includes
agreement to a shutdown of the facility and a plan to maintain
its assets for possible future use.

Citing the results of a Union revitalization study, current
depressed pricing in the steel market, the declining state of
the economy, and LTV's current financial condition, the USWA
said it had agreed with the company's determination that
continuing operations at the Cleveland West facility at this
time were not feasible.

As part of the amended agreement, the USWA secured a commitment
from LTV to build steelmaking capacity in Cleveland when the
company returns to viability and profitability, as well as
agreement to a preservation plan for Cleveland West that
maintains the facility's assets for future use.

"The thing of greatest significance for our members at Cleveland
West," said USWA District 1 Director David McCall, "is that
we've secured the right for those who qualify for the Rule of
70/80 or the Rule of 65 to take their pensions between now and
December 1." He said this provision would make those workers who
retired by December 1 eligible for added federal protection of
their pension benefits.

McCall said that the amended agreement prevents the shutdown of
Cleveland West from triggering elimination of the Union's
company-wide Employment Security clause, which would have been
the case without this change.

The amended agreement also extends the company's deadline for
securing investment capital through the Emergency Steel Loan
Guarantee program until December 15 and allows it to use an
additional $12 million of Voluntary Employee Benefit Association
(VEBA) funds to cover costs for retiree health insurance
payments.


MADISON RIVER: Tight Liquidity Prods S&P to Put Ratings on Watch
----------------------------------------------------------------
Standard & Poor's placed its ratings on Madison River Telephone
Company LLC and units Madison River Capital LLC and Madison
River Finance Corp. on CreditWatch with negative implications.

The CreditWatch placement is based on Madison River's tight
liquidity position, and the narrowing window on a $35 million
cash obligation due in April 2002 that the company currently
does not have funding for. In addition, the company announced
that it was exploring options with respect to its high yield
notes, though no decisions have been reached.

Standard & Poor's will meet with management to discuss these
issues before resolving the CreditWatch listing.

Ratings Placed On Creditwatch With Negative Implications

     Madison River Telephone Company LLC             RATING
          Corporate credit rating                       B

     Madison River Capital LLC
          Corporate credit rating                       B
          $250 mil. 13.25% senior unsecured notes
            (Co-issued by Madison River Finance Corp.)  CCC+
      
     Madison River Finance Corp.
          Corporate credit rating                       B


NORTHLAND CRANBERRIES: Effects Reverse Split & Delists Shares
-------------------------------------------------------------
Northland Cranberries, Inc. (OTC: NRCNA), manufacturer and
marketer of Northland 100% juice cranberry blends and Seneca
fruit juice products, announced that its Board of Directors
approved a one-for-four reverse stock split. As a result of the
reverse stock split, each four Northland shares outstanding is
being automatically converted and combined into a single share.
Fractional shares otherwise resulting from the reverse stock
split will be rounded up to the next highest share. Northland's
Board of Directors was previously provided with the authority to
effect this reverse split by Northland's shareholders at its
January 30, 2001 annual shareholders meeting.

Northland is effecting the reverse stock split to facilitate a
potential debt and equity restructuring that, if consummated,
would allow it to successfully avoid a bankruptcy proceeding.

Northland also announced that it voluntarily delisted its Class
A common shares from trading on the Nasdaq National Market
System effective as of the close of business on November 5, 2001
so that its shares could begin trading on the over-the-counter
bulletin board on November 6, 2001. Northland's shares will be
traded under the new trading symbol "NRCNA." The OTC bulletin
board is a regulated quotation service that displays real-time
quotes, last sale prices, and volume information in over-the-
counter equity securities.

Northland is a vertically integrated grower, handler, processor
and marketer of cranberries and value-added cranberry products.
The Company processes and sells Northland brand 100% juice
cranberry blends, Seneca brand juice products, Northland brand
fresh cranberries and other cranberry products through retail
supermarkets and other distribution channels. Northland also
sells cranberry and other fruit concentrates to industrial
customers who manufacture juice products.


NORTHLAND CRANBERRIES: Sun Affiliate Takes-On Debt & Control
------------------------------------------------------------
Northland Cranberries, Inc. (OTC Bulletin Board: NRCNA),
manufacturer and marketer of Northland 100% juice cranberry
blends and Seneca fruit juice products, announced that it
consummated a debt and equity restructuring that allows it to
successfully avoid a bankruptcy proceeding.  Northland expects
that this restructuring will provide it with sufficient working
capital and new borrowing capacity to once again aggressively
market and support the sale of its Northland and Seneca brand
juice products.

The debt restructuring was accomplished through the exchange by
the members of Northland's then current bank group of
approximately $151 million of total outstanding revolving credit
agreement indebtedness for a total of $38.4 million in cash, as
well as by Northland's issuance of revised debt obligations in
the total principal amount of $25.7 million and newly-issued
shares of common stock representing a total of 7.5% of
Northland's fully-diluted common shares to the certain bank
group members which decided to continue as lenders to Northland.
The debt restructuring occurred pursuant to an agreement for the
assignment and assumption by Sun Northland, LLC, an affiliate of
Sun Capital Partners, Boca Raton, Fla., of a portion of
Northland's bank group indebtedness.  The debt restructuring
resulted in the cancellation of approximately $87 million of the
Company's then existing outstanding revolving bank debt.
Financing for the debt restructuring, and for additional working
capital availability to Northland, was provided by Foothill
Capital Corporation, Los Angeles, Calif.  Foothill provided
Northland with $20 million in term loan financing and a new $30
million revolving credit facility.  As part of the consideration
to Foothill to provide the new credit facilities to Northland,
Foothill (and its assigns) received warrants to purchase up to a
total of 5% of Northland's fully-diluted common shares at an
exercise price equal to one cent per share.

Northland's equity restructuring was accomplished through an
investment of $7 million of equity capital into Northland by Sun
Northland, LLC, an affiliate of Sun Capital Partners, together
with the assignment of Sun Northland's rights to Northland's
cancelled bank debt of approximately $87 million, in exchange
for Class A common shares, a newly-created series of
convertible, voting preferred stock and a second newly-created
series of preferred stock, which together represent 77.5% of
Northland's fully-diluted common shares.

After giving effect to the debt and equity restructuring
transactions, as well as the anticipated future issuances of
stock options to key employees of Northland, Northland's
existing shareholders' ownership percentage is expected to
constitute approximately 5% of Northland's fully-diluted common
shares.

In connection with the equity restructuring and investment by
Sun Northland, LLC, Northland appointed a new Board of
Directors.  John Swendrowski, Northland's Chairman and Chief
Executive Officer, will continue as a member of Northland's
Board.  Additionally, five representatives of Sun Capital
Partners have been appointed to replace Northland's other
existing Board members.

John Swendrowski, Northland's Chairman and CEO, stated, "We have
worked diligently over the last year to restructure our balance
sheet and capital structure to reduce our debt burden and
provide us with the necessary working capital to again
aggressively compete on the juice aisle and start regaining the
lost market share of our Northland and Seneca brands through
renewed media and trade promotions.  After lengthy and difficult
negotiations, we reached the point where it was imperative to
reach an agreement with our current bank group and to refinance
our bank debt with a new lender, or else we were faced with
liquidating or reorganizing the company in a bankruptcy
proceeding in which our creditors would have likely received
substantially less value than they are now receiving and our
shareholders would have been completely wiped out.

"After a very lengthy exploration and pursuit of many possible
available strategic alternatives, we believe that this
restructuring provides our current shareholders and our
creditors with the maximum value attainable given the current
financial condition of our company and the current difficult
economic realities of the cranberry industry," said Swendrowski.

"Our restructuring will also help maintain both jobs for our
employees and our excellent ongoing relationships with our
customers, vendors, growers and trade creditors," said
Swendrowski.

M. Steven Liff, Vice President of Sun Capital Partners, Inc,
said:  "Sun Capital is very enthusiastic about its investment in
Northland Cranberries, Inc.  We believe there are tremendous
opportunities to promote Northland's brands and increase its
market position.  With our capital infusion and operational
expertise, coupled with John Swendrowski and his outstanding
management team, Northland should be well positioned to benefit
from a much healthier capital structure.  Furthermore, the new
capital base will allow for continued investment in Northland's
brands and its business in general."

Swendrowski said, "We couldn't be more pleased to have the
financial and operational support of Sun Capital to help us
aggressively begin the process of rebuilding our brands and
returning to profitability, so that we can again begin growing
our company and work towards increasing shareholder value over
the long-term.  Sun Capital has an outstanding reputation and
history of adding value to its portfolio companies and we think
this combination will make us a very strong competitor on the
juice aisle.

"We intend to launch a new advertising campaign focused on the
health benefits of our Northland juice line of products during
the week of Thanksgiving.  Over the next twelve months, in
addition to our new media campaign, we will focus on regaining
lost distribution and reinforcing our current trade promotional
programs," said Swendrowski.

Foothill Capital is a specialty financial services company that
provides asset-based financing to middle-market companies across
the United States and Canada.  Foothill has a proven track
record of nearly 30 years of service, excellent turnaround times
and an interactive loan approval process.  Foothill provides
secured commercial loans to a broad spectrum of industries,
under a variety of structures designed to fit a company's unique
financing needs. Foothill is a wholly-owned subsidiary of Wells
Fargo & Company, one of North American's largest financial
services companies with over $200 billion in assets.

Sun Capital Partners, Inc. is a leading merchant banking firm
focused on leveraged buyouts.  Sun Capital has invested in
approximately 30 companies during the past several years with
combined sales in excess of $2 billion. Sun Capital recently
completed the formation of its latest private equity fund, which
raised $200 million.  Participating in Sun Capital's fund are
leading fund-of-funds investors, university endowments, pension
funds, financial institutions and high net worth individuals,
families and trusts.

Northland is a vertically integrated grower, handler, processor
and marketer of cranberries and value-added cranberry products.  
The Company processes and sells Northland brand 100% juice
cranberry blends, Seneca brand juice products, Northland brand
fresh cranberries and other cranberry products through retail
supermarkets and other distribution channels.  Northland also
sells cranberry and other fruit concentrates to industrial
customers who manufacture juice products.


NORTHLAND CRANBERRIES: Sees $100-110 Million Loss For FY 2001
-------------------------------------------------------------
Northland Cranberries, Inc. (OTC Bulletin Board: NRCNA) relates
that, while its financial statements for its fiscal year ended
August 31, 2001 have not yet been finalized, it anticipates
reporting a pre-tax loss of approximately $100-110 million for
the fiscal year that will include charges of approximately $100
million, reflecting writedowns on various impaired assets,
including assets held for sale, cranberry properties, receiving
and concentrate production facilities and various inventory
items.  The writedowns are expected to consist of approximately
$18 million in writedowns to net realizable value in the
carrying value of raw cranberry and cranberry concentrate
inventories and approximately $82 million in writedowns for
cranberry bogs and other facilities and assets.  The impairment
resulted primarily from the continued deterioration in the long-
term prospects for the cranberry growing and processing industry
over the summer due, in part, to the implementation of an
inadequate USDA cranberry marketing order for the 2001 crop
year, continued large levels of excess cranberry inventories
held by Northland and other industry participants, as well as
continued long-term cranberry market prices which are under
growers' costs of production.  The post-writedown values of
Northland's assets are supported by appraisals and were
considered by Northland's lenders in connection with the debt
restructuring.


OWENS CORNING: Asbestos Panel Taps Prof. Warren as Consultant
-------------------------------------------------------------
The Official Committee of Asbestos Injury Claimants in Owens
Corning's chapter 11 case presents the Bankruptcy Court with its
application to employ Professor Elizabeth Warren as a special
Bankruptcy Consultant to Caplin & Drysdale, National Counsel for
the Committee, nunc pro tunc to August 1, 2001.

Matthew G. Zaleski, Esq., at Campbell & Levine LLC, in
Wilmington, Delaware, says that as of August 1, 2001, Caplin &
Drysdale engaged Professor Warren (the Leo Gottlieb Professor of
Law at the Harvard Law School) as a Special Bankruptcy
Consultant to the firm.

Mr. Zaleski relates that Professor Warren will provide very
limited services in these cases, adding that her billable hours
will generally not exceed 10 hours per month. The Committee
understands that Prof. Warren will work with Caplin & Drysdale
as a consultant in these cases -- and every other asbestos-
related case in which Caplin serves as counsel to a committee --
by providing guidance and advice to the Asbestos Committee
throughout the firm. Mr. Zaleski says that she will generally
focus her efforts in assisting Caplin & Drysdale with respect to
the Plan of Reorganization process and will not be involved in
the day-to-day administration of the case.

To avoid conflicts with Caplin & Drysdale's non-bankruptcy
clients, Mr. Zaleski tells the Court that Professor Warren will
not be a member of Caplin & Drysdale nor maintain a counsel
relationship with the firm. He says that Professor Warren will
maintain her own time records in compliance with the Court's
Administrative Order. Caplin & Drysdale will incorporate her
time entries in its billing statement and bill for Professor
Warren's services as part of the firm's monthly and quarterly
fee applications. Mr. Zaleski explains that this will facilitate
the administrative process and minimize her administrative time.

Mr. Zaleski assures the Court that Professor Warren is a
disinterested person. She neither holds nor represents any
interest adverse to the Debtors or their estates. She also has
not previously represented any other entity involved this case
in any matter related to these cases. Mr. Zaleski submits that
Professor Warren is a distinguished academician, with extensive
teaching experience and numerous publications in the field of
bankruptcy law.

          Unsecured Creditors Committee Objects

The Official Committee of Unsecured Creditors objects. As an
initial matter, Michael G. Wilson, Esq., at Morris Nichols Arsht
& Tunnell, in Wilmington, Delaware says that the application has
not provided specific facts showing the necessity for the
employment and provides no basis for the need for need for the
employment of Professor Warren. In addition, the services to be
rendered by Professor Warren remain unclear and anticipates only
that Professor Warren will provide very limited services and
that here billable hours will not exceed ten hours per month and
usually will be significantly less. After a review of the
Retention Application and Warren Statement, Mr. Wilson tells the
Court that it is unclear whether such a limited employment of
Professor Warren by Caplin & Drysdale is necessary. Further, it
is impossible to divine the true nature of the services to be
rendered by Professor Warren from the limited descriptions that
have been provided.

Mr. Wilson claims that the blanket statement in the Retention
Application and the Warren Statement that Professor Warren is
disinterested and neither holds nor represents any interest
adverse to the Debtors or the Debtors' estates is insufficient
to satisfy the disclosure requirements. Nowhere in the Retention
Application nor in the Warren Statement is there any explanation
of the investigation made by Professor Warren to determine that
she has no connection with any such relevant entity or person.
Therefore, Mr. Wilson concludes that since no mention is made of
what investigation has been undertaken regarding the
connections, it follows that the application must be denied.
Specifically, it is unclear what inquiry was made into the
activities, relationships, contracts and investments of Harvard
and its affiliated entities to determine whether there was any
connection with the Debtors, their creditors or any other party
in interest.

Mr. Wilson explains that the duty of disclosure of all actual
and potential conflicts of interests rests with the party
seeking employment and even where a party may believe that such
conflicts are outweighed by other considerations such conflicts
must still be disclosed. Given the lack of information
concerning the necessity for the employment of Professor Warren
and the lack of information provided concerning Harvard's
possible connections to interested parties in this or other
pending asbestos related chapter 11 cases, the Retention
Application must be denied. In the alternative, Mr. Wilson
submits that any hearing on the merits of the retention
application should be adjourned until such time as the Creditors
Committee has completed discovery of both Professor Warren and
Harvard.

Mr. Wilson claims that under the Bankruptcy Code only the
Committee appointed is allowed to select professionals to
represent or perform services for such committee. The Retention
Application, however, does not request the employment of
Professor Warren to represent or provide services to the
Asbestos Committee but rather, the Asbestos Committee is asking
that this Court approve the employment of Professor Warren to
serve as a consultant to its national counsel Caplin & Drysdale.
Mr. Wilson points out that the advice and guidance to be
provided to Caplin & Drysdale will not be specific to this case,
but rather will encompass all cases in which Caplin & Drysdale
represents the asbestos committee in a pending chapter 11 case.
While the Creditors Committee recognizes that the Asbestos
Committee could seek to employ Professor Warren to provide
services directly to the committee, the Creditors Committee is
unaware of any basis for seeking court approval for the
employment of a consultant to a law firm to be paid from the
debtor's estate, which consultant will be hired to provided
advice with respect to several cases in addition to that in
which the approval is sought.

Mr. Wilson notes that while Professor Warren's hourly rate of
$675 is commensurate with the rate of other professionals of her
age and experience level who have been employed in this case,
there may or may not be a question as to whether this rate is
excessive. Professionals charging this rate who are partners in
law firms do not directly and personally receive the full amount
of the per-hour charges but rather, such amounts are contributed
to their law firm and a portion of such amounts are used to pay
overhead. Accordingly, without knowing more about the terms of
Professor Warren's employment with Harvard and what role Harvard
may play in either supporting or limiting such employment, Mr.
Wilson asserts that it is impossible to form an opinion as to
the appropriateness of the employment or as to the proposed
hourly rate. (Owens Corning Bankruptcy News, Issue No. 21;
Bankruptcy Creditors' Service, Inc., 609/392-0900)   


PLAYTEX PRODUCTS: S&P Affirms Low-B Ratings With Neg. Outlook
-------------------------------------------------------------
Standard & Poor's revised its outlook for Playtex Products Inc.
to negative from stable. At the same time, the double-'B'-minus
corporate credit and senior secured bank loan ratings, and
single-'B' subordinated debt rating for the company were
affirmed.

Total debt was about $880 million at September 30, 2001.

The outlook revision is based on Playtex's weakened operating
and financial performance, which is below Standard & Poor's
earlier expectations for 2001. In addition, competitive industry
conditions and the challenging retail environment are expected
to further impact the company's results over the near term.

The ratings on Playtex reflect the company's high debt leverage
and small size in relation to competitors, partially offset by
the company's solid market position in the infant-care,
feminine-care, and sun-care categories.

Playtex maintains a dominant position in infant-care, and strong
No. 2 market share positions in both the feminine-care and sun-
care segments. The 1999 acquisitions of the Diaper Genie and
Baby Magic brands led to the infant-care division becoming
Playtex's largest category, accounting for over a third of total
revenues. Nevertheless, the company has lost market share in
this segment due to intense competition by financially stronger
rivals. Standard & Poor's believes that Playtex will continue to
be challenged to increase profits over the near term, while
maintaining its infant-care market share position.

Playtex reported a 1.4% revenue decline for the nine months
ended Sept. 30, 2001 compared to the same period last year due
largely to weakness in the company's infant-care segment. The
revenue decline resulted from a difficult operating environment
and intense competition in the category. Operating profits
(before depreciation and amortization) declined 8.9% for the
nine months ended September 30, 2001 compared to the same period
last year; primarily a result of increased advertising and sales
promotion spending to defend the company's infant-care market
share position.

Credit measures are weak for the rating given the company's high
debt leverage and reduced operating earnings. For the trailing
12 months ended September 30, 2001, EBITDA coverage of interest
expense was about 1.9 times, while debt to EBITDA (adjusted for
the accounts receivable securitization) was 5.2x. Standard &
Poor's anticipates that coverage ratios will remain weak over
the near term as a result of Playtex's high debt leverage and
difficult industry fundamentals in many of the company's
categories. The rating does not incorporate flexibility for
significant debt-financed acquisitions or share repurchases.

                      Outlook: Negative

Playtex's credit measures are currently weak for the rating. If
steps taken by management fail to result in an improvement of
credit measures over the intermediate term, the ratings could be
lowered.


POLAROID CORPORATION: Seeks Approval of KPMG's Employment
---------------------------------------------------------
Polaroid Corporation requests authority to retain and
employ KPMG LLP as their accountants and financial advisors.

Neal D. Goldman, EVP and Chief Administrative Officer of
Polaroid Corporation, advises the Court that the Debtors have
requested KPMG to conduct an audit with an objective of
expressing an opinion as to whether the Debtors' financial
statements conform with generally accepted accounting principles
and published rules and regulations of the Securities and
Exchange Commission.

In addition, KPMG will render these services:

(A) Accounting and Auditing Services

    (i) Analysis of accounting issues and advice to the Debtors'
        management regarding the proper accounting treatment of
        events;

   (ii) Performance of other accounting services for the Debtors
        as may be necessary or desirable.

(B) Tax Advisory Services

    (i) Advice and assistance to the Debtors regarding
        preparation of the tax provision for the financial
        statements issues, including, but not limited to,
        assistance in estimating net operating loss
        carryforwards, international taxes, and state and local
        taxes;

   (ii) Participation with the auditors in determining the
        reasonableness of the tax provision and tax valuation
        reserves; and

  (iii) Other consulting, advice, research, planning or analysis
        regarding tax issues as may be requested from time to
        time.


According to Mr. Goldman, the Debtors have selected KPMG because
of the firm's diverse experience and extensive knowledge in the
fields of accounting, auditing and taxation.  In addition, Mr.
Goldman highlights KPMG's considerable experience with rendering
services to debtors and other parties in numerous chapter 11
cases.

Pursuant to an engagement letter dated October 11, 2001, KPMG's
fees for examining the Debtors' 2001 consolidated financial
statements shall be performed for a fixed, negotiated fee of
$575,000.  Moreover, KPMG's compensation for additional
professional services will be based on customary hourly rates:

    Partners                                $600 - $500
    Directors/Senior Managers/Managers      $400 - $300
    Senior/Staff Accountants                $250 - $125
    Paraprofessionals                       $100 - $ 75

KPMG will also seek reimbursement for necessary expenses
incurred.  Mr. Goldman reports that KPMG has received an advance
payment retainer of $50,000.  Although the Debtors owe KPMG
$50,000 for services rendered prior to the Petition Date, KPMG
will waive any right to recover amounts owed to it by the
Debtors for pre-petition services.

Alfred Woollacott, III, a partner with the firm, declares that
KPMG does not hold or represent an interest adverse to the
estate that would impair KPMG's ability to objectively perform
professional services for the Debtors.  According to Mr.
Woollacott, KPMG is a "disinterested person" as defined in the
Bankruptcy Code.  KPMG has not provided and will not provide any
professional services to any of the creditors, other parties-in-
interest, or their respective attorneys and accountants with
regard to any matter related to this Chapter 11 case, Mr.
Woollacott assured Judge Walsh. (Polaroid Bankruptcy News, Issue
No. 3; Bankruptcy Creditors' Service, Inc., 609/392-0900)


POLAROID: ID Unit Auction Draws Resistance from Creditors
---------------------------------------------------------
Polaroid Corp.'s efforts to unload its identification card
business has faced intense resistance from the bankrupt
company's unsecured creditors committee as well as a potential
bidder -- both of whom warn that proposed bidding procedures
will chill the auction process, The Daily Deal reports.

In separate objections to the bidding procedures, the unsecured
creditors and ImageID Ltd., a three-year-old Israeli digital
imaging company interested in acquiring the ID business, said
the aggressive timetable Polaroid requested for the auction and
sale might prevent participation in the bid process.

Furthermore, the two parties claim in court documents that the
proposed bidding procedures are unfairly skewed toward the $32
million stalking-horse bid offered by PIDS Holding Inc., which
consists of the current senior management of the ID business.

Judge Peter Walsh in the U.S. Bankruptcy Court in Wilmington,
Delaware, yesterday gave final approval for Cambridge,
Massachusetts-based Polaroid to use $10 million of a $50 million
debtor-in-possession (DIP) financing package. He then held a
hearing regarding the bidding procedures. If Walsh approves the
proposed bidding procedures, competing bids are due on November
16 and must be at least $33.6 million, according to court
records. If a qualified competing bid is submitted, an auction
will be held on November 20. All subsequent bids must be
$500,000 more than the preceding bid. A sale hearing will be
held on November 26.


RENT-WAY INC.: Makes Tender Offer To Exchange Securities Options
----------------------------------------------------------------
Rent-Way, Inc. is making a Tender Offer to exchange outstanding
options to purchase approximately 2,287,403 shares of Rent-Way's
common stock, no par value, for new options. This offer excludes
options held by directors and executive officers of Rent-Way.
The number of shares of common stock subject to the New Options
will be equal to the number of shares of common stock subject to
options tendered, accepted for exchange and cancelled, as that
number may be adjusted for stock splits, reverse stock splits,
stock dividends and similar events.


RESPONSE BIOMEDICAL: Creditors Accept Canadian BIA Proposal
-----------------------------------------------------------
Response Biomedical Corp. (RBM: CDNX), developer of the RAMP(TM)
diagnostic system, announces that one hundred percent of the
voting creditors of the Company voted to accept the proposal
filed with the British Columbia Supreme Court under the
Bankruptcy and Insolvency Act. The Company will now seek
court approval and move to fulfill the terms of the proposal to
the satisfaction of the trustee.

Further to the October 9, 2001 meeting with the U.S. Food and
Drug Administration (FDA) in Washington D.C., the Company has
submitted its written response to the FDA's request for
additional information. The FDA has indicated that Response
Biomedical's 510(k) application for premarket clearance of the
RAMP Myoglobin Assay and RAMP Reader will now be removed
from its "on-hold" status.  

"Getting our FDA submission back on track and the approval of
the creditor proposal are two substantial steps towards
rebuilding value for all of our stakeholders," said Bill Radvak,
President & CEO of Response Biomedical. "I wish to thank the
creditors for their support through this process, thereby
providing the opportunity for our Company to move forward and
realize the potential of RAMP."

Response Biomedical develops quantitative, diagnostic tests for
use with its proprietary RAMP Reader intended to be used for
clinical, STAT-lab and point-of-care applications. The RAMP
System is expected to reduce the cost of healthcare by allowing
rapid and easy-to-use medical tests to be performed in
hospitals, clinics, laboratories and physicians' offices
worldwide. The Company's platform technology has the potential
to be used with more than 250 medical tests that are currently
performed by traditional laboratory methods. Response
Biomedical's shares are listed on the Canadian Venture
Exchange under the trading symbol "RBM". For further
information, visit the Company's Web site at
http://www.responsebio.com


SABENA: Asks To End Legal Composition & Files for Bankruptcy
------------------------------------------------------------
Mr. Fred Chaffart, Chairman of the Board of Directors of Sabena
SA/NV, informs that Sabena has been obliged to request the court
to end the legal composition ('Concordat judiciare') and to file
for bankruptcy. This means that the court most probably will
soon declare the company bankrupt.

The Board is forced to take this decision due to the
increasingly bad results of Sabena, caused by several factors:

     * The continued lack of profitability of the company;

     * The aggressive expansionist strategy of Swissair, its
sudden reversal in 2001, followed by the non-payment of a
contractually promised capital increase;

     * The legal composition of Swissair;

     * The wild strikes of the previous months;

     * The crisis in the aviation industry, dramatically
increased by the September 11 events in the USA.

Sabena takes all possible measures to confront the current
dramatic situation.

     * Plans are being developed, with Belgian investors and
financial institutions, and with Virgin Express, to start a
smaller, more adequate airline activity, based on the regional
airline DAT. This activity would focus on Europe, with possibly
some profitable long haul destinations. Objective is to keep the
country, out of Zaventem, linked with the rest of the world and
to guarantee employment possibilities for thousands of people;

     * There are continued efforts to transfer subsidiaries to
new and more stable owners while maintaining a maximum of
employment. Mention can be made of Sobelair, Sabena Technics,
Sabena Hotels, Atraxis Belgium and others.

     * Together with the Belgian Government employment and
assistance plans are foreseen. The trade unions have been
invited to start negotiations on the social plan with the
Belgian Government this evening, chaired by the social
conciliator. Objective is to define support and assistance for
all concerned employees;

     * Starting Tuesday evening, all European and
intercontinental flights of Sabena will be suspended. This will
also be the case for at least until Wednesday. The Company
therefore appeals Sabena passengers not to come to the airport.
The Company apologizes towards the passengers for the
inconvenience caused by this decision and try to limit the
consequences as soon as possible. The Company asks the
passengers to take up contact with their travel agent. More
clearity on possibilities of rebooking and refund is expected in
the coming days. Hope is expressed to start short haul
operations as soon as possible and that more information on an
eventual more extensive.


SAFETY-KLEEN CORP: Employs Jefferson Wells as New Accountant
------------------------------------------------------------
Larry W. Singleton, CEO of Safety-Kleen Corporation, asks Judge
Peter Walsh to authorize the Debtor and its direct and indirect
subsidiaries and affiliates for his approval of the Debtors'
employment, nunc pro tunc to September 27, 2001, of Jefferson
Wells International, inc., to provide accounting, tax and
internal audit implementation and support services.  Mr.
Singleton tells Judge Walsh that JWI is in the business
of providing temporary internal audit, accounting, tax and
technology services to large and mid-size companies throughout
the United States. JWI is not a public accounting or consulting
firm.

Pursuant to an engagement letter dated September 27, 2001 and a
Master Services Agreement dated September 27, 2001, the Debtors
have engaged JWI, subject to Judge Walsh's approval, to render
accounting, tax and internal audit implementation and support
services, including, but not limited to:

       (a) Review and assess data currently collected and
defined by Safety-Kleen's Accounting Procedure and Control
Initiative effort;

       (b) Design and implement required process modifications
to improve accuracy, efficiency and offset risk;

       (c) Design and implement required controls, monitoring,
and internal audit functions to ensure continued efficiency and
risk management;

       (d) Review standard costing systems and methodology
utilized by branch support groups including, the machine
manufacturing plant, solvent recycling plants, and oil re-
refining plants;

       (e) Provide analysis and recommendations to branch
accounting allocation of overhead costs such as disposal,
transportation, warehousing, and corporate;

       (f) Provide analysis and recommendations to increase the
integrity of overall data including the areas of chart of
accounts, pay-roll recording, intercompany accounts, and branch
expenses;

       (g) Make available from time to time, as requested by the
Debtors, professionals to assist with various accounting and
tax-related support needs of the Debtors; and

       (h) Provide ongoing internal audit services as requested
by the Debtors' management.

The Debtors assure Judge Walsh that JWI's services will not be
duplicative of any other outside professional services in this
case.

In their recent 10-K/A filing, the Debtors committed to
undertake certain projects to improve their accounting and
internal audit procedures. The Debtors have chosen JWI to
provide assistance in completing those projects and in assisting
the Debtors to improve business processes and controls.

JWI tells Judge Walsh that Safety-Kleen has recently
restructured by hiring a new executive management team and is
implementing recommended business improvements across its
businesses. Many of these business improvements are directly
related to the financial condition of the company with regard to
needed accounting and controls processes, establishment of
improved management reporting tools, and expansion of the
internal audit function.  Among the many challenges to improve
the business, three key objectives have been identified:

       (1) Safety-Kleen needs to timely file 10-Ks and 10-Qs
with confidence, and accuracy.

       (2) Safety-Kleen needs to improve its financial system,
processes and related internal controls so that its external
auditor can endorse the controls during the annual audit.

       (3) Safely-Kleen requires the implementation of processes
and controls that support and deliver accurate management
reporting data to support the new business structure and
executive team.

In addition, management has indicated that it has and will
continue to identify a number of accounting and tax-related
areas where additional support will likely be needed in the
coming months in order to meet its business objectives.

JWI's initial recommended strategy is two-fold: (1) pursue the
ultimate goal of long-term business process improvement and
controls. (2) Execute immediate improvements identified by
Safety-Kleen's Accounting Procedure and Control Initiative and
Financial Reporting Integrity Projects. JWI's project managers
will, JWI tells Judge Walsh, ensure a cohesive, consistent
approach throughout the Safety-Kleen business units. The
specific timeline for implementing immediate improvements
will be defined as an initial priority.  To elaborate further,
JWI recommends the use of a strategic team focused on the design
and implementation of an end-to-end process and control
environment to deliver accurate management and financial
reporting and internal controls. To implement real change as
swiftly as possible, the strategic team would be responsible for
recommending the formation of "tactical" teams to attack
immediate needs identified.

For the first two key company objectives outlined above, Safety-
Kleen has begun to address the deficiencies identified by the
APCI and FRIP projects. These teams have made significant
progress in documenting the existing accounting-related
procedures in place throughout the company. However, to assist
in the design and implementation of improved processes and
controls, Safety-Kleen is requesting JWI to:

       (1) Review and assess data currently collected and
defined by Safety-Kleen's APCI effort.

       (2) Design and implement required process modifications
to improve accuracy, efficiency and offset risk.

       (3) Design and implement required controls, monitoring,
and internal audit functions to ensure continued efficiency and
risk management.

For the third key company objective outlined above, JWI will
adapt and leverage the work performed to date in both the FRIP
and APCI projects. During JWI's discussions with Safety-Kleen,
the following concentrated areas in management reporting were
identified:

       (a) Review of standard costing system and methodology
utilized by branch support groups, including the machine
manufacturing plant, solvent recycling plants, and oil refining
plants.

       (b) Evaluate branch accounting allocation of overhead
costs such as disposal transportation, warehousing, and
corporate.

       (c) Assess the integrity of overall data including the
areas of chart of accounts, payroll recording, intercompany
accounts, and branch expenses.

In addition, JWI will make available from time to time, as
requested, professionals to assist with various accounting and
tax-related support needs to assist SK in meeting its business
objectives.

A JWI National Director will be assigned and regularly on site
at Safety-Kleen in Columbia.  Also, Engagement Managers will
document a weekly status report to summarize and communicate the
status of each identified project to Safety-Kleen management.

                           Compensation

JWI announces that it proposes a unique solution to provide
Safety-Kleen with maximum expertise while remaining sensitive to
cost constraints. The hourly professional fees for this
engagement are:

     National Director(s)                        $175
     Practice Director/Managing Director(s)      $150
     Engagement Manager(s)                       $140
     Team Leader(s)                              $115
     Information Technology Professional(s)      $125
     Accounting, Internal Audit and
               Tax Professional(s)               $105

JWI does not charge a premium for overtime hours worked. Note
that JWI may utilize certain professionals who are paid on an
hourly basis.

JWI will bill for services based upon its customary hourly
rates. At the present time, JWI's standard hourly rates range
from $105 for accounting, internal audit and tax professionals
to $175 for national directors. The Debtors also are required to
reimburse JWI for all reasonable travel and actual out-of-pocket
expenses incurred while performing the services described
herein. Payments of interim compensation to JWI shall be in
accordance with the local rules of the Bankruptcy Court for the
District of Delaware and that certain Administrative Order Under
11 U.S.C.  105(a) and 331 Establishing Procedures for Interim
Compensation and Reimbursement of Expenses of Professionals
entered by Judge Walsh in these proceedings.

Dennis J. Langer, the Director of Accounting Operations, avers
to Judge Walsh that JWI is a wholly-owned but separately
operating subsidiary of Manpower, Inc., a world-wide temporary
staffing agency. The services provided by JWI are different in
significant ways from those provided by Manpower. Therefore, Mr.
Langer warns that no attempt was made to ascertain whether
Manpower has any existing client relationships with the Debtors,
or their creditors, shareholders, parties-in-interest or
counsel.

Mr. Langer assures Judge Walsh that JWI is disinterested and
neither holds nor represents any interest adverse to the Debtor
in the matters for which his approval is sought.  However, JWI
may from time to time, or previously has provided, services to
known parties in interest or their respect affiliates in matters
unrelated to this bankruptcy case. These parties and the work
performed are:

       (1) Cenex Harvest States Transport -- Internal audit
controls review and IT implementation/process improvement;

       (2) Enterprise Transportation (Enterprise Rent-a-Car) --
IT implementation/process improvement;

       (3) Pitney Bowes Credit Corporation and Pitney Bowes
Office Systems -- Internal audit operations review;

       (4) Reynolds and Reynolds Co. -- Internal audit review;

       (5) Schneider National Carriers, Inc. -- Accounting and
finance analysis and modeling;

       (6) Bank of America -- Lender and internal audit
services;

       (7) Bank of Hawaii -- Contract audit;

       (8) Chase Bank -- General accounting services;

       (9) Citibank, N.A. -- General services;

       (10) Delta Airlines -- Regulatory compliance services;

       (11) Deutsche Financial Services -- Support for federal
return;

       (12) Fifth Third Bank -- Various accounting, financial,
and policy and procedures review services;

       (13) First Union -- Risk assessment;

       (14) FleetBoston Financial Corporation -- Audit level
risk services;

       (15) General Motors Corporation -- Operational review,
forensic, and analysis and modeling services;

       (16) Imperial Bank -- Contract audit;

       (17) Northern Trust Bank -- Process mapping and general
accounting services;

       (18) PNC Business Credit -- Lender services;

       (19) PNC Mortgage Securities Corporation -- Process
review and implementation;

       (20) Societe Generale -- Security audit and review and
controls review and testing; and

       (21) Textron Financial Corporation -- Lender services.

JWI may from time to time provide, or may previously have
provided, services to other creditors of the Debtors and parties
in interest not included in this list, but in no event in
matters which conflict with the Debtors or these estates.
(Safety-Kleen Bankruptcy News, Issue No. 22; Bankruptcy
Creditors' Service, Inc., 609/392-0900)    


SPALDING HOLDINGS: Proposes Exchange Offer to Recapitalize
----------------------------------------------------------
Spalding Holdings Corporation is continuing to work actively
with certain holders of more than 90% of its 10-3/8% Senior
Subordinated Notes due 2006 on a proposal to exchange the notes
for other securities as part of a recapitalization of the
Company. As previously announced, Spalding elected not to make
its October 1st interest payment on the senior subordinated
notes. The holders of more than 90% of the senior subordinated
notes have consented to an extension of the grace period from 30
days to 51 days pending recapitalization negotiations. The
Company has been in contact with the agent under its senior
credit facility, and the agent has expressed its support for the
Company's recapitalization efforts.

There can be no assurance that the negotiations with the holders
of the Company's senior subordinated notes will result in an
agreement among the parties, nor can there be any assurance that
the Company's bank creditors will be supportive of the Company's
decision to pursue these negotiations. Nevertheless, the Company
indicates that it has the liquidity to continue to pay its trade
creditors on a timely basis.


SUN HEALTHCARE: THCI Mortgage Seeks Relief From Automatic Stay
--------------------------------------------------------------
THCI Mortgage Holding Company LLC asks the Court to issue an
order

(1) granting it relief from the automatic stay in accordance
    with section 362(d) of the Bankruptcy Code and Bankruptcy
    Rule 4001(a)(1) in order to exercise its rights under Loan
    Documents governing certain notes, loan, mortgage and
    security that it holds by assignment from Meditrust Mortgage
    Investment, Inc. in relation to certain properties purchased
    by affiliates of Sun;

(2) restraining Sun Healthcare Group, Inc.'s use of cash
    collateral.

THCI tells the Court that Sun affiliates have defaulted payment
under Loan Agreements in relation to mortgaged properties as
follows:

(A) Boston, Massachusetts Property

    - purchased by Debtor Mediplex Rehabilitation of
      Massachusetts, Inc. in 1993 with a loan of $8,740,000 from
      Meditrust,

    - located at 910 Saratoga Street and 16-20 Trident Street in
      Boston, Suffolk County, Massachusetts.

    - the Boston Property is improved with (i) a 109-bed long
      term care facility and (ii) an approximately 2,740 square
      foot office building.

    - post-petition default totals $11,442,945 as of August 31,
      2001 (including $8,197,937 in principal, $2,873,377 in
      interest at the default rate, with per diem interest
      accruing at the rate of $4,099, $6,806 in late fees,
      $364,825 in additional interest, plus reasonable fees,
      costs and charges);

(B) Brookline, Massachusetts Property

    - purchased by Debtor Mediplex of Massachusetts, Inc. in
      1993 with a loan of $4,700,000 from Meditrust,

    - consists of 5 parcels of land located in Brookline,
      Norfolk County, Massachusetts which are improved with a
      120-bed skilled nursing facility known as Mediplex of
      Brookline (the Brookline Leasehold),

    - post-petition default totals $5,243,288 as of August 31,
      2001 (including $3,754,596 in principal, $1,315,986 in
      interest at the default rate, with per diem interest
      accruing at the rate of $1,877, $6,806 in late fees,
      $165,900 in additional interest, plus reasonable fees,
      costs and charges);

(C) Thornton, Colorado Property

    - purchased by Mediplex of Colorado, Inc. (an affiliate of
      Sun according to THCI) in 1994 with a loan of $11,000,000
      from Meditrust,

    - located at 8451-8515 Pearl Street in Thornton, Adams
      County, Colorado improved with (i) a 117-licensed bed
      rehabilitation nursing care facility and psychiatric
      hospital and (ii) a medical office building,

    - post-petition default totals $12,758,300 as of August 31,
      2001 (including $9,114,770 in principal, $3,194,727 in
      interest at the default rate, with per diem interest
      accruing at the rate of $4,630, $6,806 in late fees,
      $441,997 in additional interest, plus reasonable fees,
      costs and charges);

(D) Stamford, Connecticut Property

    - purchased by Debtor G-WZ in 1993 with a loan of $9,768,000
      from Meditrust,

    - located in Stamford, Fairfield County, Connecticut which
      is improved with a 120-bed skilled nursing facility,

    - post-petition default totals $12,887,707 as of June 30,
      2001 (including $9,260,232 in principal, $3,245,711 in
      interest at the default rate, with per diem interest
      accruing at the rate of $4,557, $6,806 in late fees,
      $374,958 in additional interest, plus reasonable fees,
      costs and charges.

THCI tells the Court that Sun Healthcare Group, Inc. and The
Mediplex Group, Inc. have guaranteed all obligations under the
Boston Loan Documents, the Brookline Loan Documents, the
Thornton Loan Documents and the Stamford Loan Documents. In
addition, the Loan Documents are cross-collateralized and, thus,
each mortgage debt is secured by the Boston Property, the
Brookline Property, the Thornton Property and the Stamford  
Property. Furthermore, the Loan Documents secure any and all
obligations by and between any Sun Healthcare Group, Inc.
affiliate and any Meditrust affiliate, including, without
limitation, certain leases.

THCI believes that relief from the automatic stay should be
granted  pursuant to section 362(d) of the Bankruptcy Code, on
the following bases,  among others:

        -- Sun has failed to provide adequate protection to
THCI's secured claim and cash collateral rights. Specifically,
Sun has failed to adequately protect THCI's interests in the
Properties and the income, rent and other cash proceeds
generated by the Properties (collectively, the Rents). Further,
on information and belief, Sun has commingled the Rents with
cash generated from its numerous other properties. Therefore,
THCI should be granted relief from the automatic stay under
section 362(d)(1) of the Bankruptcy Code, so that it may
safeguard its interests through foreclosure and similar state
law remedies.

        -- Sun has no equity in the Properties, and the
Properties are not necessary to Sun's effective reorganization.

        -- THCI has a properly perfected security in the Rents.
THCI's interest in the Rents is not being adequately protected,
due to Sun's  failure to segregate the Rents and take other
measures to safeguard THCI's  interests.

        -- State law determines the existence of an interest in
property  such as rents. As a result, the laws of the states in
which the Properties  are located, namely, Massachusetts,
Colorado, and Connecticut, govern  THCI's lien rights in the
Rents. Under the laws of Massachusetts, Colorado  and
Connecticut, a creditor may secure its interest in rents either
by  recording an assignment of interest in the rents in the
records of the  county recorder in which the property is
located, or by a conveyance of an  absolute assignment in the
pertinent documents which becomes perfected upon  default. In
each instance, Meditrust recorded its mortgages and assignment  
agreements in the appropriate state and county offices, and
thereby  perfected its liens in the Rents (which THCI now holds
by assignment).

        -- Section 552(b)(2) of the Code governs the post-
petition effect of  security interests in certain property
conveyed pre-petition, and provides  in relevant part as
follows:

                (2) if the debtor and an entity entered into a
        security agreement before the commencement of a case and
        if the security interest created by such security
        agreement extends to property of the debtor acquired
        before the commencement of the case and to amounts paid
        as rents of such property... then such security interest
        extends to such rents. . . acquired by the estate after
        the commencement of the case to the extent provided in
        such security agreement. . . and constitutes cash
        collateral under 11 U.S.C. section 363. 11 U.S.C.
        section 552(b)(2).

        -- By virtue of the actions taken by its assignor
(Meditrust) to  perfect its interests in the Rents under state
law, and by virtue of  section 552(b) of the Bankruptcy Code,
which governs the post-petition  effect of security interests in
certain property conveyed pre-petition,  THCI now holds a valid
and perfected first priority lien in the Rents  generated by
each of the Properties. To the extent that the Rents are  deemed
to be an asset which is subject to Article 9 of the Uniform  
Commercial Code, as adopted in Massachusetts, Colorado or
Connecticut, the Mortgage contains a lien grant with respect to
Sun's accounts, and that  lien grant, combined with the timely
filing of the Financing Statements,  vested Meditrust (and THCI,
as Meditrust's assignee) with senior liens on  the revenue of
the Properties, regardless of whether the Rents are  considered
to be an incident of the real estate or personal property.

        -- The Rents are cash collateral. (See 11 U. S. C.
section 552(b)(2) and 363 (a).) Sun, by virtue of the Loan
Agreements and also under applicable provisions of the
Bankruptcy Code, is prohibited from using  Rents, other than to
satisfy its obligations to THCI under the terms of the  
Agreements, unless THCI has consented to such use, or Sun has
provided  adequate protection to THCI.

THCI requests an accounting of Sun's post-petition use of the
Rents and requests that the Court enter an order restricting
Sun's further use of the Rents except to the extent necessary to
(a) maintain and operate the  Properties, within such budget as
may be consented to by THCI; and (b) to  pay principal, interest
and other fees, costs and expenses due to THCI  under the
Agreements.

To the extent that relief from the automatic stay as to Sun is
necessary in order to account for, segregate, collect and
enforce THCI's liens upon the Rents, including, without
limitation, the appointment of a receiver, THCI requests relief
from the automatic stay to do so. (Sun Healthcare Bankruptcy
News, Issue No. 25; Bankruptcy Creditors' Service, Inc.,
609/392-0900)   


VLASIC FOODS: Lays-Out Case for Plan Confirmation
-------------------------------------------------
Vlasic Foods International, Inc. insists that the plan complies
with the applicable provisions of the Bankruptcy code. Thus, the
Debtors assert the plan should be confirmed.

Robert A. Weber, Esq., at Skadden, Arps, Slate, Meagher & Flom,
in Wilmington, Delaware, maintains that the plan properly
designates classes of claims and interests.

The Debtors assert that the Plan's classification scheme
recognizes the differing legal and equitable rights of creditors
versus Interest holders, secured versus unsecured claims and
priority versus non-priority claims.

Mr. Weber observes that the objections of Campbell Soup Company
and The Money's Trust challenge the classification in Class 5 of
both general unsecured trade claims and claims of the holders of
Senior Subordinated Notes. But the Debtors assert that
classifying Senior Subordinated Note Claims together with
General Unsecured Claims is appropriate because the Senior
Subordinated Note Holders and the General Unsecured Creditors
have identical rights as against the Debtors. So, under the
terms of the plan, Mr. Weber notes that both the Senior
Subordinated Note Holders and the General Unsecured Creditors
will receive equal treatment from the Debtors. Because the plan
appropriately classifies the claims together in Class 5, the
Debtors assert that the objections should be overruled.

Mr. Weber informs the Court that the Committee has designated
Mr. Ben Branch to serve as the LLC Manager and identified Mr.
Noah Postyn, Mr. Nicholas Walsh, and Mr. Abe Siemens as the
initial Managing Board Members. As LLC Manager, Mr. Weber says,
Mr. Branch will serve as an authorized signatory of the Debtors
and will have responsibility for the management (subject to the
Managing Board's oversight) of the VFI LLC's affairs and Plan
implementation.

According to Mr. Weber, Money's and Campbell's claim -- that the
plan is flawed because the LLC Manager and the Managing Board
will suffer from a conflict of interest that will interfere with
the performance of their duty to pursue any viable Causes of
Action against the Bank Group -- is unsupported. In the absence
of any concrete factual allegations, Mr. Weber argues that the
objectors' assertions regarding potential breaches of fiduciary
duty should be given no weight.

Furthermore, Mr. Weber asserts that the plan was proposed in
good faith, the plan does not discriminate unfairly with respect
to deemed nonaccepting classes, the plan is "fair and equitable"
with respect to deemed nonaccepting classes.

Thus, the Debtors ask the Court to overrule any objections to
confirmation not previously withdrawn or settled and confirm the
Plan. (Vlasic Foods Bankruptcy News, Issue No. 14; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


WARNACO: Asks Court To Permit D&O Insurer To Pay $3.3MM Claim
-------------------------------------------------------------
The Warnaco Group, Inc. seeks a Court order that would
enable it to receive approximately $3,300,000 in cash under one
of its insurance policies. Also, the Debtors request Judge
Bohanon's permission to allow its insurance companies to
reimburse the costs and expenses of defense of its officers and
Officers and Directors, who are entitled to reimbursement out of
various insurance policies under which they are insured parties.

Shalom L. Kohn, Esq., at Sidley Austin Brown & Wood, in New
York, New York, relates Warnaco is a party to various pre-
petition insurance policies, which insure the Company and its
Officers and Directors with respect to various claims.

Specifically, Mr. Kohn relates that National Union Fire
Insurance Company of Pittsburgh, Pennsylvania sold to Warnaco
certain directors, officers and corporate liability insurance
policies with policy periods of September 6, 1997 to October 1,
2000 and October 1, 2000 to October 1, 2002, respectively.

According to Mr. Kohn, Coverage A of the primary insurance
policies provides coverage for "the Loss of each and every
Director or Officer of the Company arising from a Claim ... for
any actual or alleged Wrongful Act..." While Coverage B of the
primary insurance policies provides coverage for "the Loss of
the Company arising from a Securities Claim first made against
the Company, or Claim first made against the Directors or
Officers... for any actual or alleged Wrongful Act..."

Thus, Mr. Kohn notes, the Officers and Directors of Warnaco, as
well as Warnaco itself, are insured under the primary insurance
policies.

In addition, Mr. Kohn tells the Court, Warnaco purchased excess
insurance policies from these insurance companies to provide
coverage once the limits of the primary insurance policies have
been exhausted:

     (i) Columbia Casualty Company, Reliance Insurance Company
(now assumed by The Hartford Group), Federal Insurance Company;
and

    (ii) Continental Casualty Company, Twin City Fire Insurance
Company, Lumbermens Insurance Company, Greenwich Insurance
Company, Great American Insurance Company, Zurich Insurance
Company, and National Union.

Hence, Mr. Kohn says, the Officers and Directors of Warnaco, as
well as Warnaco itself, are also insured under the excess
insurance policies.

According to Mr. Kohn, National Union has agreed that coverage
exists under one of the primary insurance policies for an action
styled as Calvin Klein Trademark Trust and Calvin Klein, Inc. v.
Linda Wachner, Warnaco Group, Inc., Warnaco, Inc., Designer
Holdings, Ltd., CKJHoldings, Inc., Jeanswear Holdings Inc.,
Calvin Klein Jeanswear Co., and Outlet Holdings, Inc., No.
00-CIV-4052 (S.D.N.Y.).

In accordance with National Union's acknowledgment of coverage,
Mr. Kohn says, Warnaco began submitting schedules of invoices
for reimbursement by National Union relating to the legal fees
and costs incurred by Warnaco in the defense of its Officer and
Director in the Calvin Klein action. Mr. Kohn informs Judge
Bohanon that National Union made partial payments on that
reimbursement claim to Warnaco in January 2001, and again in May
2001.

After the Petition Date, Mr. Kohn says, National Union agreed
that an additional $3,299,073 was due and owing on Warnaco's
reimbursement claim in relation to the Calvin Klein action.
However, Mr. Kohn relates, National Union refused to pay unless
Warnaco first obtain the Court's order authorizing the payment.

Thus, Mr. Kohn explains, this motion is intended to satisfy
National Union's demand and to facilitate the receipt by the
estate of approximately $3,300,000 in cash.

Separately, Mr. Kohn informs the Court that National Union has
also admitted that coverage exists under one of the primary
insurance policies for two currently pending consolidated
securities class action lawsuits:

     (a) In re The Warnaco Group, Inc. Securities Litigation,
No. 00-CIV-6266 (LMM) (S.D.N.Y.); and

     (b) In re The Warnaco Group, Inc. Securities Litigation
(II), No. 01-CIV-3346 (MGC) (S.D.N.Y.)

Mr. Kohn says Warnaco and certain of its Officers and Directors
are named as defendants in the Securities Litigation.

Likewise, Mr. Kohn relates, Warnaco also submitted reimbursement
requests to National Union as to the legal fees and costs
incurred in the defense of its Officers and Directors in the
Securities Litigation. Similarly, Mr. Kohn notes, National Union
refused to make any payments under the primary insurance policy
of the legal fees and costs incurred in the defense of Warnaco's
Officers and Directors in the Securities Litigation until
Warnaco first obtain a Court order authorizing such payment.

In addition, Mr. Kohn tells Judge Bohanon that the Excess
Insurance Companies have also reserved their rights with respect
to the Securities Litigation. Warnaco contends that the Excess
Insurance Companies will be obligated to begin making payments
under the excess insurance policies once the limits of the
primary insurance policies have been exhausted. At that time,
the Debtors anticipate that the Excess Insurance Companies will
also doubtless demand a Court order as a prerequisite to any
such payments.

                       Responses

(A) Lead Plaintiffs

    The Lead Plaintiffs in the federal securities class action
pending in the United States District Court for the Southern
District of New York contend that the Debtors' motion is
unnecessary.

Michael S. Etkin, Esq., at Lowenstein Sandler, PC, in New York,
New York, observes that the Debtors indicate in the Motion that
absent the request of the Directors and Officers Insurers, "a
Court order would otherwise be unnecessary given the direct
contractual rights of the individual directors and officers".

However, Mr. Etkin notes that the case law cited by the Debtors
in the Motion stands for the proposition that the insurance
proceeds are not property of the Debtors' estate and, therefore,
a Court order is not required to pay proceeds on behalf of non-
debtor insureds covered by the Directors and Officers Policies.

"Since the Debtors and the individual directors and officers
have a contractual right to reimbursement under the Directors
and Officers Policies, this Court need not determine the
underlying issue of whether the proceeds of the Directors and
Officers Policies are property of the estate," Mr. Etkin
asserts. In fact, Lead Plaintiffs maintain that the proceeds are
not property of the estate.

Therefore, the Lead Plaintiffs ask Judge Bohanon that any order
entered in connection with the Motion specifically indicate that
that such order is not deemed to be a determination that the
proceeds of the Directors and Officers Policies are property of
the estate.

(B) Creditors' Committee

    The Official Committee of Unsecured Creditors of The Warnaco
Group, Inc., believes that the Directors and Officers Policies
clearly constitute property of the Debtors' estates. While
under the Directors and Officers Policies, Scott L. Hazan, Esq.,
at Otterbourg, Steindler, Houston & Rosen, PC, in New York, New
York, notes the Officers and Directors may be entitled to
reimbursement of defense costs and the Debtors' estates likewise
may have an interest in the proceeds.

According to Mr. Hazan, the Debtors and their estates have a
potentially valuable interest in the insurance proceeds, which
interest, the Committee is concerned the Officers and Directors
may exhaust simply because they are the first to make a claim
against the Directors and Officers Policies and the proceeds. At
this early stage of the Debtors' cases, Mr. Hazan tells the
Court, the Committee has yet to complete its Section 1103(c)
investigation of potential claims held by the estates.

Therefore, while at this time the Committee does not object to
the specific relief sought by the Debtors, the Committee
reserves its rights to object to further payments. In addition,
the Committee reserves its rights to seek Court authorization to
restrict or prohibit the Officers and Directors from exhausting
the proceeds of the Directors and Officers Policies to pay the
legal fees and expenses or satisfy any judgments. (Warnaco
Bankruptcy News, Issue No. 12; Bankruptcy Creditors' Service,
Inc., 609/392-0900)  


WINSTAR COMMUNICATIONS: Settles $8.2MM Claim Dispute With Lexent
----------------------------------------------------------------
Prior to the Petition Date, Lexent, Inc., provided general
construction services to Winstar Communications, Inc. under
certain purchase orders, work statements and other documents
evidencing the Services provided to the Debtors prior to the
Petition Date. Lexent asserts it is owed approximately
$8,200,000 for pre-petition services performed under the Work
Documents. Lexent also claims that it is entitled to assert
mechanics' liens against buildings occupied by the Debtors and
critical to the Debtors' operations to secure payment of all
such amounts owed to Lexent. Were all such mechanics' liens
filed and valid, the Debtors believe they would have to pay
approximately $8,200,000 to building owners to have such liens
removed; failure to remove such liens could jeopardize the
Debtors' ability to continue to operate at those buildings after
emerging from Chapter 11. Pending its settlement discussions
with the Debtors, Lexent has not yet filed any mechanics' liens
against the Debtors.

The Debtors paid certain amounts billed by Lexent, including
amounts validly charged for state sales taxes. The Debtors may
have been entitled to obtain exemptions from certain state sales
taxes invoiced by and paid to Lexent. The Debtors also may be
entitled to request refunds from various state taxing
authorities of sales taxes from which the Debtors were exempt
but for which they nonetheless paid. The Debtors estimate that
the maximum amount of refund they conceivably could recover if
all exempt state sales taxes paid to Lexent were recovered is
approximately $2,500,000. Recovery of any such amounts is
conditioned upon satisfactory negotiation with or litigation
against taxing authorities, the outcome of which is uncertain.

The Debtors and Lexent desire to avoid costly and time consuming
litigation over the amount of Lexent's claims and the amount of
such claims secured or which could be secured by mechanics
liens. Accordingly, the Debtors and Lexent sought and obtained
the Court's approval for the stipulation to settle the dispute.

M. Blake Cleary, Esq., at Young Conaway Stargatt & Taylor, LLP,
in Wilmington, Delaware, tells the Court that the parties have
agreed to the Stipulation and the payment terms in order to
continue their relationship in a cooperative, mutually
beneficial fashion, to avoid potentially costly litigation and
to provide valuable benefits to the Debtors' estates and to
Lexent. The Stipulation' generally provides that in order to
resolve the dispute as to the proper amount the Debtors should
be obligated to pay under the Work Documents, the Debtors will
pay $2,000,000 to Lexent and also will assign to Lexent all of
their right, title and interest in and the to Tax Refunds, and
all proceeds thereof. In consideration for the Settlement Amount
and the assignment of the Tax Refunds and proceeds thereof, Mr.
Cleary states that Lexent will agree to accept the Settlement
Amount and the Tax Refunds in lieu of the disputed amount owed
under the Work Documents.

Under the terms of the stipulation approved by Judge Farnan, the
Debtors will:

A. pay to Lexent the Settlement Amount, pursuant to the
       Mechanics' Lien Order,

B. assign all of their right, title and interest in and to the
       Tax Refunds, and all proceeds thereof, to Lexent and

C. agree not to take any action to collect any of the Tax
       Refunds.

In consideration therefore under the Stipulation, Lexent agrees:

A. to the assignment of the Tax Refunds,

B. to release all claims against and forever covenant not to sue
       any of the Debtors, assert any claim against or otherwise
       seek recovery from any of the Debtors on account thereof
       and

C. not to file any mechanics' liens against any building or any
       portion of any building in or on which Lexent has
       performed work by or on behalf of the Debtors prior to
       the Petition Date as a result of such work.

The Settlement Amount shall be paid in four equal installments
of $500,000 on the fifth business day after this Stipulation is
"So Ordered" by the Bankruptcy Court and thereafter on the
fifteenth calendar day of each of November 2001, December 2001
and January 2002. If the Debtors shall fail to make any such
payment, then:

A. Lexent shall be entitled to retain any payments made by the
       Debtors and

B. if the Debtors' failure to make such payment shall continue
       for a period of five business days after receipt of
       written notice of such failure to pay from Lexent, then

       1. the release and covenant not to sue granted by Lexent  
            to the Debtors shall be deemed null and void,

       2. the assignment of the Tax Refunds shall remain in full
            force and effect,

       3. Lexent will be authorized without further Order of
            this Court to file Mechanics' Liens, but only to the
            extent of the portion of the Settlement Amount that
            remains due and owing, and

       4. all claims of Lexent against one or more of the
            Debtors existing as of the date hereof which have
            not been satisfied shall be in full force and
            effect.

Upon the effective date of the Stipulation, except with respect
to actions arising under work performed under the Work Documents
and in connection with future performance under the Work
Documents, the Debtors will release any claims against Lexent
and Lexent will release any claims against the Debtors in
connection with the prepetition disputed amounts owed by the
Debtors to Lexent under the Work Documents. The Stipulation also
permits the Debtors to maintain a highly beneficial and valuable
business relationship with Lexent, one of their largest and most
valued contractors.

The Debtors submit that the Stipulation is reasonable and is in
the best interests of the Debtors, their estates and their
creditors. The Debtors have determined that the imposition of
the Mechanics' Liens would impair their on-going business
operations and can prevent the imposition of the Mechanics'
Liens and can realize substantial cash savings under the terms
of the Stipulation, both in terms of the absolute cost of
amounts owed for the Services and more significantly, in the
present and near term, cash payments due thereunder. Mr. Cleary
says that the cash component of the payment the Debtors would be
required to make under the Work Documents, claimed to be
approximately $8,200,000, of which $3,800,000 could potentially
be secured by valid, perfected mechanics' liens, would be
$2,000,000, with the remainder coming from the assignment of the
Tax Refunds, if any.  Mr. Cleary contends that the Debtors will
derive substantial benefit from this arrangement, as it will
prevent the assertion of the Mechanics Liens by Lexent and will
greatly reduce the amount paid in settlement of the disputed
amounts owed by the Debtors to Lexent for the Services. (Winstar
Bankruptcy News, Issue No. 17; Bankruptcy Creditors' Service,
Inc., 609/392-0900)   

                           *********

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

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

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

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

                          *********

S U B S C R I P T I O N   I N F O R M A T I O N

Troubled Company Reporter is a daily newsletter co-published by
Bankruptcy Creditors' Service, Inc., Trenton, NJ USA, and Beard
Group, Inc., Washington, DC USA. 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 240/629-3300.


                  *** End of Transmission ***