TCR_Public/011109.mbx        T R O U B L E D   C O M P A N Y   R E P O R T E R

           Friday, November 9, 2001, Vol. 5, No. 219

                          Headlines

AMF BOWLING: Unsecured Panel Demands Documents from Debtors
AMERICAN AIRLINES: Tie-Up with British Airways Meets Resistance
ASHTON TECHNOLOGY: Nasdaq Delists Securities Effective Nov. 7
ASPEON INC: Continues to Defer Preferred Share Dividends
BRM HOLDINGS: Wants More Time to Decide on Wilmington Lease

BETHLEHEM STEEL: Court Approves Sec. 345 Investment Guidelines
CHESAPEAKE ENERGY: Fitch Assigns B Rating To New Preferred Stock
CHESAPEAKE ENERGY: Issuing New Conv. Preferred Shares at $50
COMDISCO INC: Sungard Seeks Approval to Participate in Discovery
CREDIT ACCEPTANCE: Completes $62MM Financing to Repay Debts

CYBEX: Debt Restructuring Talks with Fleet National Bank Ongoing
DANKA BUSINESS: Improved Debt Structure Yields Better Q2 Results
DELTA FINANCIAL: Completes Restructuring Plan in Third Quarter
EXODUS COMMS: Proposes Accounts Receivable Settlement Protocol
EXODUS COMMS: Resolves Financial Issues with StorageNetworks

FEDERAL-MOGUL: Taps Penningtons as Counsel for Overseas Claims
FISHER COMMUNICATIONS: Intends to Sell Unit's Real Estate Assets
GENESIS HEALTH: Intends to Waive Wells Fargo Claims Re Wicomico
GENTEK INC: Says Third Quarter Performance "Essentially Flat"
HOUSE2HOME INC: NYSE Suspends Shares After Bankruptcy Filing

HOUSE2HOME: Case Summary & 20 Largest Unsecured Creditors
IMAGEMAX: Redirection in Operation Sees Decline in Revenue Trend
LOEWEN: Amends Michigan Cemetery Asset Purchase Agreement
LOEWS CINEPLEX: Beats Landlord out of $500K of Annual Rent
MARINER POST-ACUTE: Solicits Bids for Pharmaceutical Business

MERISTAR HOTELS: Posts $1.6MM Net Loss On $77MM Revenues In Q3
METROMEDIA FIBER: Net Loss More Than Doubles in Third Quarter
MONARCH DENTAL: Continues Talks For EBITDA Covenant Waiver
OWENS CORNING: Signs-Up Shumaker as Bankruptcy Co-Counsel
PAXSON COMMUNIATIONS: Gross Revenues Remain Flat in 3rd Quarter

PHAR-MOR: Wants More Time to Assume or Reject Unexpired Leases
PIONEER COMPANIES: Confirmation Hearing Adjourned Until Nov. 28
PIXTECH INC: Restructuring Efforts Reduce Cash Burn Rate by 23%
POLAROID CORP: Engages Bingham Dana As International Counsel
REBEL.COM: Telus Acquires Unix Outsourcing Division Assets

ROYAL AVIATION: Leblanc Offers to Take-Over Assets and Debts
SMTC CORP: Bank Group Agrees to Waive Covenant Violations
SAFETY-KLEEN: Court Okays Agreement to Indemnify EVP/CAO Arnst
SPACEHAB INC: Firms-Up Debt Workout Terms with Two Creditors
SUN HEALTHCARE: Court Approves Settlement with Worldcom Inc.

SUN HEALTHCARE: Changes Management to Begin Emergence Process
SUN HEALTHCARE: Files Joint Plan of Reorganization in Delaware
TELEX COMMS: Exchange Offer & Solicitation Expires On Nov. 20
VLASIC FOODS: Committee Names Initial Members of VFI LLC Board
WARNACO GROUP: Court Okays Bear Stearns As Financial Advisors

WESTPOINT STEVENS: DebtTraders Analyst Sees No Improvements
WINSTAR COMMS: CIT Lending Demands $268K Monthly Lease Payments

BOOK REVIEW: TRANSCONTINENTAL RAILWAY STRATEGY:
             A Study of Businessmen


                          *********

AMF BOWLING: Unsecured Panel Demands Documents from Debtors
-----------------------------------------------------------
The Official Committee of Unsecured Creditors of AMF Bowling
Worldwide asks the U.S. Bankruptcy Court to compel AMF Bowling
Worldwide Inc., AMF Bowling, Inc., and other AMF Affiliates to
produce a wide assortment of documents for examination,
inspection and copying and to deliver those documents to its
legal team led by Jonathan L. Hauser, Esq., at Troutman Sanders
LLP, on or before November 12, 2001:

A. All Documents reflecting or relating to the valuation of the
   Reorganized Company through "free cash flows" or the
   "discounted cash flow" approach.

B. All Documents reflecting or relating to the valuation of the
   Reorganized Company through "an analysis of public market
   valuation multiples".

C. All Documents reflecting or relating to the "group of
   publicly traded companies whose growth prospects and
   principal characteristics . . . are reasonably similar to
   those of the Debtors", including all Documents reflecting or
   relating to companies that were considered but rejected for
   inclusion in such group.

D. All Documents reflecting or relating to any studies and/or
   analyses made or used in the valuations.

E. All Documents reflecting or relating to any analysis,
   including preliminary, incomplete or tentative analyses,
   performed or reviewed by Worldwide in connection with any
   valuation, including preliminary, incomplete or tentative
   valuations, of any or all of the Debtors.

F. All Documents furnished by any or all of the Debtors, AMF
   Bowling, Inc., and/or the AMF Affiliates to Blackstone,
   Wasserstein Perella, or any other entity or person in
   connection with any valuation, including preliminary,
   incomplete or tentative valuations, of any or all of the
   Debtors.

G. All Documents relating to the estimation of the value of the
   New Warrants and/or the value of the initial grant of the
   New Management Options using the Black-Scholes option
   pricing method as described on pages 69 and 70 of the
   Disclosure Statement.

H. All Documents relating to any estimation, including
   preliminary, incomplete, or tentative estimations, of the
   value of the New Warrants and/or the value of the initial
   grant of the New Management Options other than the
   estimation described in the Disclosure Statement.

I. All Documents furnished by any or all of the Debtors, to any
   entity or person in connection with any estimation,
   including preliminary, incomplete, or tentative
   estimations, of the value of the New Warrants and/or the
   value of the initial grant of the New Management Options.

J. All Documents relating to any valuation, including
   preliminary, incomplete, or tentative valuations, of the
   New AMF Notes and/or the Senior Lender Facility Notes.

K. All Documents furnished by any or all of the Debtors to any
   other entity or person in connection with any valuation,
   including preliminary, incomplete, or tentative valuations,
   of the New AMF Notes and/or the Senior Lender Facility
   Notes. (AMF Bankruptcy News, Issue No. 11; Bankruptcy
   Creditors' Service, Inc., 609/392-0900)    


AMERICAN AIRLINES: Tie-Up with British Airways Meets Resistance
---------------------------------------------------------------
Sir Richard Branson, Chairman of Virgin Atlantic Airways,
slammed the proposed alliance between American Airlines and
British Airways in evidence given to a US Congressional hearing.

Speaking to an influential group of US Senators Branson said:
"What is before the regulators today is the future of a
competitive international aviation industry. I firmly believe
that allowing American and BA to proceed with their plans will
irrevocably damage an industry that is already on its knees.

"This alliance will mean less, not more competition. It will
mean increased domination by BA and its oneworld alliance
partners at Heathrow. An AA/BA alliance would be blatantly anti-
consumer and anti-competitive. This will be doubly true when
taken with the proposed Star Alliance immunity application for
UK-US services."

The proposed alliance is being reviewed by the US Department of
Transportation, the UK's Office of Fair Trading and the European
Commission's competition directorate. Branson questioned how the
alliance can be considered in the current circumstances and
forecast the bankruptcy of a number of airlines:

"It is beyond me how any competition authority can conduct a
relevant, robust and meaningful competition analysis of
American's and BA's plans given the state of turmoil and
constant change that the airlines industry finds itself
following the tragic events of 11 September. Airlines are
cutting schedules, grounding aircraft and making people
redundant. Some carriers are very close indeed to bankruptcy,
both in Europe and in the United States.

"It is impossible, therefore, to predict with any degree of
certainty what the future competitive landscape will look like.
I think the one certainty that we can rely on is that if AA/BA
is allowed to proceed unfettered, it can only hasten the demise
of certain carriers.

"At a time when we may be witnessing a forced reduction in
competition among airlines it is madness to actually encourage
even less competition by allowing dominant carriers to collude
in setting prices, agreeing schedules etc."

Branson outlined Virgin Atlantic's main objectives:

     -- American and BA will form a dominant force in the trans-
Atlantic market, with over 60% of all Heathrow-US services, and
over 50% of all passengers travelling between the US and the UK.
In 2000, AA and BA between them carried nearly 9 million
passengers between the UK and the United States. The next
largest airline carried less than 3.5 million.

     -- When coupled with their dominance at their respective
hubs, AA/BA will have the effect of eliminating competition.
AA/BA have nearly 200,000 slots per year at Heathrow. Virgin
Atlantic has less than 11,000.

     -- The sheer scale of this merger will mean that its effect
will not be felt solely in the trans-Atlantic market, but
throughout the globe.

     -- The establishment of an AA/BA alliance, and possibly a
United/bmi british midland alliance, will actually reduce
competition across the Atlantic. American and BA will act as one
rather than competing against each other as they currently do,
and bmi will not compete against United - something which they
have admitted in their own joint filing to the Department of
Transportation.

     -- The position of joint dominance that oneworld, the BA
and American led alliance, and Star, the alliance involving
United and bmi, enjoy at Heathrow, when coupled with the
undeniable fact that Heathrow is full, means that carriers
outside of these alliances will not be able to mount an
effective competitive challenge unless the regulators require
these groupings, and BA in particular, to give up significant
numbers of slots at Heathrow. Between them oneworld and Star
operate 85% of all Heathrow-US services, and control nearly
three-quarters of the slots at Heathrow. Past experience
suggests that this will produce a cosy duopoly rather than
intense competition.

He also gave the airline's position on Open Skies and slot
reform: "The key argument in this entire debate is Heathrow
access. Open Skies is being held up as a panacea by American and
BA in this respect. Any form of liberalization of outdated
bilateral agreements should be welcomed, and no-one has lobbied
stronger than Virgin Atlantic to replace the current restrictive
Bermuda II agreement governing air services between the US and
the UK by a truly open competitive regime. But in respect of
Heathrow-US services Open Skies will make no difference at all.
Put simply Heathrow is full and there are no prospects of
capacity increases in the foreseeable future.

"In order for Virgin Atlantic and the US carriers to compete
effectively in trans-Atlantic markets more slots are needed at
Heathrow, and the associated terminal facilities that go with
the slots. But the slots are simply not there. Not from the slot
pool; not from partner airlines; and not on the open market. If
slots were available, then Virgin would not have had the
struggles that it has had to obtain more slots in recent years.

"The only way that the regulators can ensure access to Heathrow
is to divest American and BA of slots at the airport. And not
just any old slots. They must be slots at the optimal times for
trans-Atlantic travel - not at the margins of the day."


ASHTON TECHNOLOGY: Nasdaq Delists Securities Effective Nov. 7
-------------------------------------------------------------
The Ashton Technology Group, Inc. (NASDAQ:ASTN) announced that
it received notice from the Nasdaq Listing Qualifications Panel
that its securities will be delisted from The Nasdaq National
Market effective November 7, 2001.

Ashton's securities will immediately begin trading on the OTC
Bulletin Board.

Ashton is an eCommerce company that develops and operates
electronic trading and intelligent matching systems for the
global financial securities industry.

Its focus is to develop and operate alternative trading systems,
serving the needs of exchanges, institutional investors and
broker-dealers in the U.S. and internationally. Its goal is to
enable these market participants to trade in an electronic
global trading environment that provides large order size,
absolute anonymity, no market impact and lower transaction fees.


ASPEON INC: Continues to Defer Preferred Share Dividends
--------------------------------------------------------
Aspeon Inc. announced a $2.5 million loss for the quarter ended
Sept. 30, 2001.

Revenues for the quarter were $11.7 million that compared with
$10.6 million for the preceding quarter.

In announcing the results, CEO Richard Stack said: "I am pleased
that our sales have improved from the preceding quarter. Our
continued losses are due to a high proportion of sales of older
products at reduced prices that have had a positive effect on
cashflow. In the current quarter we are transitioning fully to
our Viper product line which will produce normal margins." Stack
also mentioned that the ASP division has become a net
contributor of cash to the core operation.

Included in the loss is an amount of $554,500 accrued for
default interest on preferred shares. On the balance sheet there
is included as a current liability an amount of $14,671,000
representing the balance owing under the preferred share
agreement (in default). In the event that a settlement is
reached with the holder, this amount may be significantly
reduced and the majority of the amount remaining will be
classified as long-term debt.

As previously reported, the company's auditors, BDO Seidman,
LLP, have not had access to the working papers of the company's
previous auditors for the fiscal years ended June 30, 1999 and
2000, and therefore, BDO Seidman was not able to complete its
audit of the company's financial statements for the fiscal year
ended June 30, 2001.

Until such time that the company's auditors are able to complete
their audit of the company's financial statements for the fiscal
year ended June 30, 2001, the company will face certain
consequences, including that the company will not be able to
file its Annual Report on Form 10-K and its Quarterly report for
the three months ended Sept. 30, 2001 on Form 10Q with the
Securities and Exchange Commission, the company will not be able
to hold its annual stockholder meeting, and stockholders of the
company will not be able to rely upon Rule 144 or 145 of the
Securities Act of 1933 for the resale of restricted securities.

The company continues to explore alternatives as to how it might
be possible to proceed, however no assurances can be made that
the company's auditors will be able to complete their audit of
the company's financial statements for the fiscal year ended
June 30, 2001.

Aspeon is a leading manufacturer and provider of point-of-sale
(POS) systems, services and enterprise technology solutions for
the retail and foodservice markets. Visit Aspeon at
http://www.aspeon.com

As at the end of September, Aspeon's current liabilities
exceeded its current assets by $13.5 million, while
stockholders' equity deficit amounted to about $7.6 million.


BRM HOLDINGS: Wants More Time to Decide on Wilmington Lease
-----------------------------------------------------------
BRM Holdings, Inc., f/k/a US Office Products Company seeks to

(i)  extend the deadline by which the Debtors assume or reject
     unexpired lease of nonresidential real property located at
     261 Ballardvale Street, Wilmington, Massachusetts, which
     lease is included among the USFresh Assets through and
     including December 3, 2001, and

(ii) establish procedure for the subsequent assumption or
     rejection of the Lease.

The Lease was included among the USFresh Assets to be sold to
All Seasons. Since the closing date, All Seasons has been
obligated to pay monthly rent and fulfill other obligations
under the Lease. Considering that All Seasons will remain liable
for monthly rent and other charges under the Lease, granting
this Motion will cause no harm to the Landlord or to the
Debtors' estate.

BRM Holdings, Inc., one of the world's leading suppliers of
office products and business services to corporate customers,
filed for chapter 11 protection on March 5, 2001 in the US
Bankruptcy Court for the District of Delaware. Brendan Linehan
Shannon, Esq., at Young Conaway Stargatt & Taylor, LLP
represents the Debtors in their
restructuring effort.


BETHLEHEM STEEL: Court Approves Sec. 345 Investment Guidelines
--------------------------------------------------------------
Bethlehem Steel Corporation requests authorization to invest
their cash and cash equivalents in accordance with their
proposed Investment Guidelines in order to relieve the Debtors
from the obligation to obtain a bond from any entity with which
money is deposited or invested.

Harvey R. Miller, Esq., at Weil, Gotshal & Manges LLP, in New
York, New York, relates that among the assets of the Debtors'
chapter 11 estates are cash and cash equivalents generated by
the daily operation of their businesses.  To maximize the value
of the Debtors' estates, Mr. Miller explains, the Debtors need
to maintain these Funds in income-producing investments to the
fullest extent possible.  However, Mr. Miller notes, these
investments must be primarily short-term in nature considering
the need for liquidity in the operation of the Debtors'
businesses.

Prior to Petition Date, the Debtors followed its own Investment
Guidelines by maintaining or investing the Funds in:

    (a) bank accounts insured by the United States;
    (b) time deposits; or
    (c) repurchase agreements.

According to Mr. Miller, time Deposits may be placed with
approved banks whose long-term debt must be rated at least "A"
(S&P) or "A-2" (Moody's).  The Debtors' Investment Guidelines
allow them to invest up to $10,000,000 of funds in any domestic
bank rated at least "B/C" (Thomson Bankwatch) or in any foreign
bank rated at least "B" (Thomson Bankwatch).  Mr. Miller
emphasizes that time Deposit maturities may not exceed 2 months
and the Investment Guidelines limit the size of investments in
any one country or bank.

Pursuant to Repurchase Agreements, Mr. Miller tells the Court,
the Debtors may purchase securities from any approved government
securities dealer that, at the same time, agrees to buy the
securities back from the Debtors at a later date at the same
price plus an agreed-upon interest rate.  Mr. Miller states that
the underlying collateral for the purchased securities must be
United States Treasury Bills, securities issued by agencies of
the United States government or straight mortgages.  In
addition, Mr. Miller relates, such collateral must have a market
value of at least 102% of the original purchase price on the
investment date and have a current market value at all times
greater than or equal to 98% of the original purchase price and
accrued interest. Furthermore, Mr. Miller says, all collateral
must be delivered to an agent of the Debtors.

Likewise, Mr. Miller relates, Repurchase Agreement maturities
may not exceed 3 months.  Also, Mr. Miller notes, the Investment
Guidelines limit the size of investments with any one securities
dealer.

The Debtors contend that these Investment Guidelines will
maximize the value of their estates.  "Although these
investments may not strictly comply with the approved investment
guidelines identified in section 345 of the Bankruptcy Code in
all cases, such deposits and investments nevertheless are safe,
prudent and designed to yield the maximum reasonable net return
on the Funds, taking into account the safety of such deposits
and investments," Mr. Miller tells the Court.

The Debtors further assert that investments made within these
Investment Guidelines will still provide the protection,
notwithstanding the absence of a "corporate surety" requirement.
First, Mr. Miller explains, the Funds may only be invested in
prudent investments like highly rated banks or over-
collateralized securities.  Second, Mr. Miller notes, a bond
secured by the undertaking of a corporate surety would be
prohibitively expensive.

                        *     *     *

Persuaded by the Debtors' arguments, Judge Lifland grants the
Debtors motion.

In addition, the Court allows the Debtors to amend their
investment guidelines from time to time, subject to Court
approval, with notice limited to the United States Trustee, the
attorneys for the Debtors' pre-petition and post-petition
lenders and any statutory committee of unsecured creditors
appointed in these chapter 11 cases.

Judge Lifland states that the Debtors' compliance with these
Investment Guidelines shall be deemed to constitute compliance
with section 345 of the Bankruptcy Code.  Accordingly, the Court
relieves the Debtors from the obligation to obtain a bond from
any entity with which money is deposited or invested in
accordance with the Investment Guidelines. (Bethlehem Bankruptcy
News, Issue No. 3; Bankruptcy Creditors' Service, Inc., 609/392-
0900)


CHESAPEAKE ENERGY: Fitch Assigns B Rating To New Preferred Stock
----------------------------------------------------------------
Fitch has assigned a 'B' rating to Chesapeake Energy's
(Chesapeake) newly issued convertible preferred stock and
affirmed the 'BB-' rating on the company's senior notes and
'BB+' rating on its senior secured bank facility.

The Rating Outlook for Chesapeake is Stable.

Chesapeake Energy announced that it had priced $150 million of
convertible preferred stock. This transaction follows the
pricing of $250 million of 8.375% senior notes completed in late
October. The proceeds from the two offerings will be used to
reduce Chesapeake's bank facility and to fund three 'tuck-in'
acquisitions.

Chesapeake is negotiating for three acquisitions of primarily
Mid-Continent natural gas reserves for an aggregate cash
purchase price of approximately $330 million. If all  
transactions are finalized and closed, Chesapeake expects to add
as much as 287 Bcfe of proved reserves consisting primarily of
Mid-Continent developed natural gas reserves with initial
average daily natural gas production of approximately 55,000
Mcfe. This would increase reserves by approximately 18% and
daily production by about 14%. The valuation of the three
transactions is about $1.06 per Mcfe, lower than other recent
acquisitions made in this region. As a result of these
transactions, Chesapeake's pro forma total debt as of September
30, would be $1.3 billion, an increase of about $60 million from
quarter-end.

The ratings reflect Chesapeake's long-lived natural gas reserve
base, its expected cash flow over the intermediate term and its
credit profile, which assumes debt reduction over the next 18-
month period. Chesapeake's proved reserves, pro forma for the
recent divestiture and potential acquisitions (as of September
30, 2001) were approximately 1,885 Bcfe, approximately 90% of
which are natural gas.

At expected production rates, the company's reserve life would
exceed 11 years. Additionally, Chesapeake has generated robust
credit metrics over the last 12 months, which, in large part,
were driven by strong natural gas prices and its successful
hedging program. Coverages, as measured by EBITDA-to-interest,
are greater than 5.0 times for the latest 12-month period, and
debt-to-EBITDA is approximately 2.0x.

Fitch anticipates that Chesapeake will post weaker metrics in
2002 because of lower gas prices, which will be largely offset
by the company's hedges. Chesapeake will likely post EBITDA-to-
interest coverage, under a 'midcycle' pricing scenario, of
approximately 3.0x (excluding $160 million in hedge gains).
While Chesapeake's present debt on both an absolute and a proven
barrel of oil equivalent (BOE) basis is high for the rating,
Fitch expects debt to decrease over the intermediate term from
significant hedge proceeds. Debt-to-capital should decrease to
approximately 60% by December 31, 2002, from approximately 67%
presently.

Chesapeake is an Oklahoma City-based company whose primary focus
is the exploration, production and development of natural gas.
Chesapeake began operations in 1989 and completed its initial
public offering in 1993. Its proved reserves are predominantly
natural gas (91%), mostly proved developed (73%), and are based
in North America. Its operations are concentrated in the Mid-
Continent (85% of assets and 75% of production), the Gulf Coast
and the Permian Basin. The company has been active in increasing
its natural gas reserve base by making acquisitions within its
core areas of operation as well as through the drillbit.

                      *    *   *  

DebtTraders reports that Chesapeake Energy's 8.500% Bonds, due
2012 (CHESP3), are trading in the high 90s.  For real-time
pricing, see http://www.debttraders.com/details.cfm?sec_id=25407


CHESAPEAKE ENERGY: Issuing New Conv. Preferred Shares at $50
------------------------------------------------------------
Chesapeake Energy Corporation (NYSE: CHK) announced that it has
priced a private offering of 3.0 million shares of cumulative
convertible preferred stock at its liquidation preference of $50
per share.  Each share of preferred stock will be subject to an
annual cumulative cash dividend of $3.375 payable quarterly
when, as and if declared by the company, on the fifteenth day of
each February, May, August and November to holders of record as
of the first day of the payment month, commencing on February
15, 2002.  The preferred stock will not be redeemable.

Each preferred share will be convertible at any time at the
option of the holder into 6.4935 shares of Chesapeake common
stock, which is based on an initial conversion price of $7.70
per common share.  The conversion price is subject to customary
adjustments in certain circumstances.  The preferred shares will
be subject to mandatory conversion after November 20, 2004 into
Chesapeake common stock, at the option of the Company, in the
event Chesapeake's common stock trades at a 30% premium to the
conversion price (initially $10.01 per common share) for 20
trading days within any period of 30 consecutive trading days.  
The preferred shares will also be subject to a limited mandatory
conversion after November 20, 2006, at the option of the Company
at a conversion price based on the market price if less than
250,000 shares remain outstanding.

The preferred stock being sold by Chesapeake and the underlying
common stock issuable on its conversion will not be registered
under the Securities Act of 1933, as amended, and may not be
offered or sold in the United States absent registration or an
applicable exemption from registration requirements.  The
preferred stock will be eligible for trading under Rule 144A.
Purchasers of the preferred stock are being granted rights to
register resales of the preferred stock and underlying common
stock under the Securities Act.  The net proceeds from this
offering will be used for general corporate purposes, including
the funding of recently announced and future acquisitions.

Chesapeake Energy Corporation is among the 10 largest
independent natural gas producers in the U.S.  Headquartered in
Oklahoma City, the company's operations are focused on
exploratory and developmental drilling and producing property
acquisitions in the Mid-Continent region of the United States.


COMDISCO INC: Sungard Seeks Approval to Participate in Discovery
----------------------------------------------------------------
SunGard Data Systems, Inc. seeks the Court's authority to
participate in discovery, including, without limitation,
discovery initiated by the Official Committee of Equity Security
Holders of Comdisco, Inc.

According to Richard M. Bendix, Jr., Esq., at Schwartz, Cooper,
Greenberger & Krauss, Chartered, in Chicago, Illinois, the
Equity Committee has served subpoenas and document requests
pursuant to which document production has commenced and
depositions will take place.  Mr. Bendix tells the Court that
SunGard wants to obtain copies of documents being produced and
wishes to attend and participation in the depositions.  But the
Debtors and the Creditors' Committee are preventing SunGard from
doing so, Mr. Bendix complains.

Mr. Bendix relates that the Debtors have reserved its right to
deny SunGard the ability to participate in the scheduled
depositions because SunGard allegedly lacks standing.  "This
position is completely unfounded," Mr. Bendix asserts.

SunGard is not a "disappointed bidder", Mr. Bendix maintains.  
On the contrary, Mr. Bendix reminds the Court, SunGard is the
high bidder for the assets of Comdisco's Availability Solutions
business and SunGard has executed a purchase agreement with
respect to those assets.  Thus, Mr. Bendix asserts, SunGard is
obligated to defend both itself and the Debtors in a currently
pending suit under the Clayton Act filed by the Department of
Justice.  Mr. Bendix emphasizes that SunGard has spent and will
continue to spend millions of dollars defending the foregoing
Clayton Act action.

If SunGard is denied the right to participate in the discovery
and if it is denied the right to conduct its own discovery to
determine whether Hewlett-Packard and the Debtors have not acted
in good faith, Mr. Bendix warns, SunGard may be irreparably
injured.

Thus, SunGard asks Judge Barliant for an entry of an order:

    (a) directing the Debtors, the Official Committee of Equity
        Security Holders and the Official Committee of Unsecured
        Creditors to permit SunGard Data Systems, Inc. to fully
        participate in the discovery initiated by the Equity
        Committee; and

    (b) directing the foregoing entities to comply with
        discovery initiated by SunGard Data Systems, Inc.
        (Comdisco Bankruptcy News, Issue No. 14; Bankruptcy
        Creditors' Service, Inc., 609/392-0900)    


CREDIT ACCEPTANCE: Completes $62MM Financing to Repay Debts
-----------------------------------------------------------
Credit Acceptance Corporation (Nasdaq:CACC) announced the
completion of a $62 million non-recourse secured financing, its
seventh asset backed financing.

Pursuant to this transaction, the Company contributed dealer
advances having a net book value of approximately $96 million to
a wholly owned special purpose corporation and received
approximately $62 million in financing from the SPC through its
financing source Kitty Hawk Funding Corporation, a multi-asset
conduit owned by Bank of America.

The proceeds of the financing were used to repay outstanding
indebtedness.

The financing bears interest at a floating rate equal to the
commercial paper rate plus 50 basis points with a maximum rate
of 6.5%, is anticipated to fully amortize within 20 months, and
is secured by the dealer advances and the rights to collections
on the related installment contracts receivable contributed to
the SPC up to the sum of the related dealer advance and the
Company's servicing fee.

The Company will retain 8% of the cash flows related to the
underlying installment contracts to cover servicing expenses.
The remaining 92%, less amounts due to dealers for payments of
dealer holdback, will be used to repay the indebtedness.

Using a unique financing structure, the Company's contracted
relationship with its dealers remains unaffected with the
dealers' rights to future payments of dealer holdback preserved.
The Company will continue to receive its 20% servicing fee on
amounts collected.

Credit Acceptance is a financial services company specializing
in products and services for a network of automobile dealer-
partners in North America and Europe. Credit Acceptance provides
its dealer-partners with financing sources for consumers with
limited access to credit and delivers credit approvals instantly
through the internet. Other dealer-partner services include
marketing, sales training and a wholesale purchasing
cooperative. Through its financing program, Credit Acceptance
helps consumers change their lives by providing them an
opportunity to strengthen and reestablish their credit standing
by making timely monthly payments. Credit Acceptance is publicly
traded on NASDAQ under the symbol CACC. For more information,
visit http://www.creditacceptance.com


CYBEX: Debt Restructuring Talks with Fleet National Bank Ongoing
----------------------------------------------------------------
Cybex International, Inc. (AMEX: CYB), a leading exercise
equipment manufacturer, reported results for the third quarter
ended September 29, 2001.

Net sales for the quarter were $19,378,000, compared to
$31,783,000 for the comparable 2000 period. Net income for the
quarter was $173,000, compared to $147,000 for the comparable
prior year period. Net sales for the nine months ended September
29, 2001 were $62,841,000, compared to $97,811,000 for the
comparable 2000 period. Net income for the nine months ended
September 29, 2001 was $574,000, compared to net income before
nonrecurring items of $376,000 (or a net loss of $1,483,000
after nonrecurring items) for the comparable 2000 period.

Cybex gave guidance that the Company will be profitable for the
fourth quarter 2001 and full year 2001. John Aglialoro, Chairman
and Chief Executive Officer, stated: "The Cybex team has
reported three straight quarters of profit and we anticipate a
profitable fourth quarter, despite the declining economy and
reduced sales. Management has positioned the Company with a
lower cost structure while preparing for the launch of new
products."

Since the second quarter 2001, the Company has requested that
the banks, under its amended Credit Agreement, defer scheduled
monthly principal payments under the facility. Since that time,
the banks have provided two waivers which extended the due date
of these monthly installments and waived through the maturity of
the loans any then existing covenant defaults. The most recent
principal installment extension expired October 12, 2001 with
the result that the Company is currently in arrears of
approximately $1,688,000 in scheduled principal installments.

There is no assurance that the Company will be able to
restructure or refinance the credit facility. However, the
Company continues to negotiate with Fleet National Bank and
First Union National Bank to restructure the credit facility to
extend the maturity date of the loans, waive any defaults and
provide a more favorable principal installment schedule, and the
Company is actively exploring alternate funding sources,
including the total refinancing of its existing credit facility.
Management is optimistic that a satisfactory resolution will be
achieved.

Cybex International, Inc. is a leading manufacturer of premium
exercise equipment for consumer and commercial use. Cybex and
the Cybex Institute, a training and research facility, are
dedicated to improving exercise performance based on an
understanding of the diverse goals and needs of individuals of
varying physical capabilities. Cybex designs and engineers each
of its products and programs to reflect the natural movement of
the human body, allowing for variation in training and assisting
each unique user -- from the professional athlete to the
rehabilitation patient - to improve their daily human
performance. For more information on Cybex and its product line,
please visit the Company's web site at www.eCybex.com.


DANKA BUSINESS: Improved Debt Structure Yields Better Q2 Results
----------------------------------------------------------------
Danka Business Systems PLC (Nasdaq:DANKY) announced its results
for the second quarter ended September 30, 2001.

The Company reported operating earnings from continuing
operations before extraordinary items and discontinued
operations of $4.2 million for the three months ended September
30, 2001 compared to an operating loss from continuing
operations before extraordinary items and discontinued
operations of $62.8 million for the three months ended September
30, 2000. The prior year second quarter included non-cash
charges of $22.4 million for the write-down of analog inventory,
$10.5 million for the write-down of rental equipment and $18.8
million for the write-off of goodwill associated with the
Company's Australian subsidiary. Excluding these items, the
operating loss from continuing operations before extraordinary
items would have been $11.1 million in the prior year second
quarter.

Earnings before interest, taxes, depreciation, and amortization
(EBITDA) from continuing operations was $25.5 million or 6.7% of
revenue for the three months ended September 30, 2001 compared
to EBITDA of $17.3 million or 3.8% of revenue for the three
months ended September 30, 2000, after excluding the charges
discussed above. EBITDA increased by $8.2 million, or 47.4%, as
compared to the prior year pro-forma EBITDA, primarily due to
lower operating expenses.  

Danka's Chief Executive Officer, Lang Lowrey, commented: "This
marks the second straight quarter of EBITDA growth for the
Company. Furthermore, we were able to exceed our EBITDA
objectives in what is typically a slow, seasonal quarter during
an obviously difficult economic environment."

Total revenue for the second quarter of fiscal year 2002
declined by $71.6 million, or 15.8%, to $381.3 million, from
$452.9 million in the prior year second quarter. This decline
was due to a decrease in retail equipment sales in the U.S. and
reduced service, supplies and rentals in both the U.S. and
Europe. The decline in retail equipment sales was primarily due
to negative market trends, a weakening of the global economic
conditions and a decline in the number of the Company's U.S.
sales representatives that was partially offset by a 29%
increase in U.S. sales productivity. The reduction in sales
representatives is part of the Company's strategic plan to
improve sales productivity while reducing operating costs. The
decline in the Company's service, supplies and rental revenue
from the prior year is primarily due to the continuing
transition from analog to digital equipment.

The Company's combined gross profit margin for the second
quarter of fiscal year 2002 was 34.0% compared to 34.8%
sequentially and 33.5% for the prior year second quarter
excluding the inventory and rental asset write-down described
above. For the first six months of fiscal year 2002, the
Company's combined gross margin was 34.4%, compared to 35.1% for
the first six months of the prior year excluding the inventory
and rental asset write-down described above.

The retail equipment sales margin for the second quarter of
fiscal year 2002 was 23.4% as compared to 23.6% sequentially and
11.0% in the prior year second quarter. The prior year second
quarter was negatively impacted by the $22.4 million write-down
of analog inventory discussed above. Excluding the charge, the
prior year second quarter retail equipment margin would have
been 24.7%. The retail service, supplies and rental margin for
the second quarter of fiscal year 2002 was 41.0% as compared to
42.3% sequentially and 36.2% in the prior year second quarter.
The prior year second quarter was negatively impacted by the
$10.5 million write-down of rental equipment. Excluding the
charge, the prior year second quarter retail service, supplies
and rental margin would have been 40.1%.

SG&A expenses decreased by $27.7 million, to $127.4 million or
33.4% of revenue, for the second quarter of fiscal year 2002
from $155.1 million or 34.3% of revenue for the prior year
second quarter. Sequentially, SG&A expenses decreased by $8.3
million. This decrease was primarily due to lower selling
expenses as a result of the lower number of sales
representatives, as discussed above. The second quarter of
fiscal year 2002 includes a $2.0 million charge related to
the exit of a non-strategic facility. For the first six months
of fiscal year 2002, SG&A expenses decreased by $52.2 million,
to $263.1 million, from $315.3 million for the comparable prior
year period, primarily due to lower selling expenses.

The Company recorded a pre-tax restructuring charge of $7.4
million in the second quarter of fiscal year 2002 which includes
a $1.3 million charge for severance and a $6.1 million charge
for the exit of facilities. Additionally, the Company reversed
$9.4 million of prior year restructuring charges.

Other expense for the second quarter and the first six months of
fiscal year 2002 included foreign currency gains as compared to
foreign currency losses for the prior year. For the first six
months of fiscal year 2002, other expenses included a $1.1
million loss related to the sale of a business.

Interest expense for the second quarter and first six months of
fiscal year 2002 decreased by $8.6 million and $18.6 million,
respectively, as compared to the corresponding periods of the
prior year, due to significantly lower outstanding debt and
reduced bank waiver fees.

Danka's Chief Financial Officer, Mark Wolfinger, commented: "We
are operating under a much improved debt structure. Our recent
restructuring, lower market interest rates, and the Company's
ability to effectively manage its senior debt during the slower
summer months have all contributed to the significant decrease
in debt service costs."

The net loss for the three months ended September 30, 2001 was
$3.4 million and included an after tax loss from discontinued
operations of $1.3 million and an after tax extraordinary loss
from the early retirement of debt of $0.2 million. The net loss
for the three months ended September 30, 2000 was $60.2 million
and included after tax earnings from discontinued operations of
$4.4 million. The Company incurred a net loss from continuing
operations of $0.10 and $1.15 per American Depositary Share
("ADS") in the second quarter of fiscal year 2002 and the second
quarter of fiscal year 2001, respectively. Net earnings/(loss)
from discontinued operations were ($0.02) and $0.07 per ADS in
the second quarter of fiscal year 2002 and 2001, respectively.

Net income for the first six months ended September 30, 2001 was
$123.3 million and included after tax earnings from discontinued
operations of $4.1 million, a first quarter gain on the sale of
Danka Services International (DSI) of $107.7 million, and an
after tax extraordinary gain from the early retirement of debt
of $26.5 million. Net loss for the first six months ended
September 30, 2000 was $61.4 million and included after tax
earnings from discontinued operations of $9.4 million. The
Company incurred a net loss from continuing operations of $0.38
and $1.33 per ADS for the first six months of fiscal year 2002
and fiscal year 2001, respectively. Net earnings from  
discontinued operations were $1.81 and $0.16 per ADS for the
first six months of fiscal year 2002 and 2001, respectively. Net
earnings from extraordinary items were $0.43 per ADS for the
first six months of fiscal year 2002.

The Company generated free cash flow (cash flow from operations
less capital expenditures) of $25.6 million in the first six
months of fiscal year 2002 as compared to $13.4 million in the
comparable prior year period. The Company is focused on
increasing its free cash flow in order to pay down its existing
indebtedness. Sequentially, the company's total debt remained
constant at approximately $375 million.

"We are encouraged by this trend, especially after considering
that the second quarter is a low revenue generating quarter due
to seasonality trends that exist within our industry," commented
Wolfinger.

Lowrey concluded: "Overall, we are encouraged by the second
quarter results. We continued to make progress on our financial
performance in many areas, including: EBITDA, free cash flow and
operating expenses as well as in many operational areas. We will
continue to focus on our debt reduction efforts and, of course,
on providing excellent products and service for our customers."

The Company has a credit agreement with a consortium of
international bank lenders through March 31, 2004. The credit
facility requires that the Company maintain minimum levels of
adjusted consolidated net worth, cumulative consolidated EBITDA,
a ratio of consolidated EBITDA to interest expense and,
effective for the nine months ended March 31, 2002, a limitation
on the maximum levels of capital expenditures, each as defined
in the credit agreement. The Company was in compliance with all
of the applicable covenants as of September 30, 2001.


DELTA FINANCIAL: Completes Restructuring Plan in Third Quarter
--------------------------------------------------------------
Delta Financial Corporation (OTCBB:DLTO) announced results for
the third quarter ended September 30, 2001.

              The Corporate Restructuring Plan

"We are pleased to announce that during the third quarter 2001,
Delta Financial successfully completed the final stage of its
corporate restructuring plan, and with it accomplished its
previously announced objectives," said Hugh Miller, President
and Chief Executive Officer of Delta Financial Corporation. "At
the beginning of 2001, we set in motion a strategic course of
action to extinguish tens of millions of dollars of debt and
significantly reduce the amount of working capital necessary to
run our business. In executing this corporate restructuring
plan, we achieved our objectives and, as previously reported,
anticipate the Company to be profitable in the fourth quarter
2001."

The Company's corporate restructuring plan included the
following highlights:

     --  Delta successfully completed the transfer of its loan
servicing portfolio to Ocwen in May 2001, thereby eliminating
the cash drain associated with ongoing monthly delinquency and
servicing advance requirements as servicer, known as
"securitization advances." The transfer eliminated the Company's
high cost of servicing a seasoned loan portfolio, including
capital charges associated with making securitization advances.

     --  The Company successfully completed its debt-
restructuring plan in August 2001, extinguishing approximately
$139.2 million of its $150 million long-term debt it was due to
repay in 2004. With the debt extinguishment, the Company reduced
its annual long-term debt interest cost from $14.25 million to
approximately $1.0 million.

     --  By extinguishing substantially all its long-term debt,
the rating agencies that previously rated the Company and its
long-term debt have withdrawn their corporate ratings, removing
perceptions associated with their ratings.

                     Third Quarter Results

As anticipated, the Company reported a loss before extraordinary
item of $33.6 million, for the quarter ended September 30, 2001,
compared to a net loss of $11.2 million for the quarter ended
September 30, 2000. The extraordinary item, net of tax for the
quarter ended September 30, 2001, totaled $19.3 million. For the
nine months ended September 30, 2001, Delta reported a loss
before extraordinary item of $83.9 million, compared to a net
loss of $12.9 million for the nine months ended September 30,
2000. The extraordinary item, net of tax for the nine months
ended September 30, 2001, totaled $19.3 million. The overall
loss for the quarter ended September 30, 2001, was primarily
attributable to (1) an extraordinary loss and professional fees
associated with the Company's debt extinguishment in August
2001; (2) a fair value adjustment to the Company's remaining
interest-only and residual certificates related to changes in
its valuation assumptions; and (3) the Company not securitizing
in the third quarter 2001, which significantly reduced its
revenues for the quarter.

During the third quarter of 2001, the Company announced that it
had extinguished $139.2 million of long-term debt by completing
its exchange offer. In the exchange offer, holders of
approximately $138.1 million in principal amount of Delta's 9
1/2% Senior Secured Notes due 2004, and holders of approximately
$1.1 million in principal amount of Delta's 9 1/2% Senior Notes
due 2004, exchanged their Notes for commensurate interests in
(1) the voting membership interests in a newly-formed LLC, to
which the Company transferred all of the mortgage-related
securities previously securing the Senior Secured Notes; (2)
shares of common stock of a newly-formed management entity which
will manage the LLC; and (3) shares of the Company's newly-
issued preferred stock having an aggregate preference amount of
$13.9 million.

As part of the exchange offer, Delta obtained a non-voting
membership interest in the LLC which entitles Delta to receive
15% of the net cash flows from the LLC for the first three years
(through June 2004) and, thereafter, 10% of the net cash flows
from the LLC. Distributions from the LLC will be paid,
approximately on a quarterly basis, commencing in the fourth
quarter of 2001.

The Company incurred an extraordinary loss and professional fees
in connection with the exchange offer totaling $20.7 million on
an after-tax basis. The extraordinary loss of $19.3 million is
comprised of the non-cash difference between (1) the aggregate
value of the (a) mortgage-related securities transferred and (b)
preferred stock issued to the tendering note holders, and (2)
the reduction in the outstanding amount of the Company's long-
term debt and other related liabilities. Professional fees of
$1.4 million incurred in connection with the debt restructuring
include legal, accounting and printing expenses.

Also in the third quarter of 2001, the Company recorded a charge
to interest income to reflect a fair value adjustment to its
remaining interest-only and residual certificates totaling $19.7
million on an after-tax basis. The Company increased the
prepayment speed, loss and discount rate assumptions that the
Company uses to estimate the fair value of its interest-only and
residual certificates as follows:

    --  Increased the peak prepayment speed on its fixed rate
mortgages to 30% from 23%, and on its adjustable rate mortgages
to 75% from 50%;

    --  Increased the initial loss reserve to 5.0% of the total
loan amount securitized from 3.5%;

    --  Increased the discount rate to 15% from 13%.

Lastly, because the Company did not securitize in the third
quarter, due both to the events of September 11th and its
aftershock effect on the markets (including the asset-backed
market), the Company did not record a gain on sale of its
mortgage loans in the third quarter of 2001. As a result, the
Company recorded substantially lower than anticipated revenues
in the third quarter, as loans remained in inventory at
September 30, 2001. The Company did, however, successfully
complete a $180 million "senior-sub" securitization in October
2001.

Loan originations for the third quarter of 2001 were $146.6
million compared to $165.1 million in the second quarter of 2001
and $197.9 million in the third quarter of 2000. This decrease
in origination volume was not unexpected, as management
continued to devote much of its attention through the end of
August on completing the debt exchange offer. Additionally, the
Company's September production was negatively impacted by the
events of September 11th. Broker and retail originations in the
third quarter of 2001 accounted for 57% and 43%, respectively,
of the Company's overall loan production, compared to last
quarter where the broker and retail channels each accounted for
50% of total production. For the third quarter of 2000, broker
and retail originations and correspondent purchases represented
66%, 33% and 1% of total production, respectively.

"All of us at Delta were deeply saddened by the tragedy of
September 11 and our hearts go out to those who have been
affected in any way," said Miller. "Through our Community
Affairs Department -- originally established in early 2000 to
develop grassroots financial education programs and
corporate/employee community outreach initiatives -- we made, as
both individual employees and as a Company, significant
contributions to the relief efforts for victims."

"With the corporate restructuring successfully completed, our
Company and our shareholders have endured a tumultuous period of
financial difficulty," said Mr. Miller. "Management is now more
determined than ever to rebuild shareholder value."

Founded in 1982, Delta Financial Corporation is a Woodbury, New
York-based specialty consumer finance company engaged in
originating, securitizing and selling (and until May 2001,
servicing) non-conforming home equity loans. Delta's loans are
primarily secured by first mortgages on one- to four-family
residential properties. Delta originates home equity loans
primarily in 20 states. Loans are originated through a network
of approximately 1,500 brokers and the Company's retail offices.
Prior to July 1, 2000, loans were also purchased through a
network of approximately 120 correspondents. Since 1991, Delta
has sold approximately $6.9 billion of its mortgages through 30
AAA rated securitizations.


EXODUS COMMS: Proposes Accounts Receivable Settlement Protocol
--------------------------------------------------------------
In the ordinary course of Exodus Communications, Inc.'s
business, and primarily to resolve billing disputes, the Debtors
routinely settle accounts receivable matters with customers and
other parties that owe the Debtors money. In the course of
reaching such Account Settlements, the Debtors provide general
releases to the settling account debtor parties in exchange for
a reciprocal release and payment of cash.

The Debtors execute approximately 15 to 20 Account Settlements
per week resulting in weekly recoveries of approximately
$500,000 on past due accounts receivable. The Debtors believe
that unless they provide releases to settling account debtors,
such account debtors will be reluctant to settle and pay funds
to the Debtors on account of and in settlement of past due
accounts receivable, for fear that the Debtors will subsequently
seek to collect additional amounts from such customers. Absent
continuation of the Debtors' ordinary course accounts receivable
settlement practices, the Debtors' cash flows and liquidity will
be adversely affected to the extent a significant amount of
accounts receivable will not be collected by them.

Accordingly, The Debtors move for entry of an order authorizing
the Debtors to enter into Account Settlements with customers
with respect to billing disputes and establishing certain notice
procedures to enter into Account Settlements with respect to
accounts receivable between $1,000,000 and $3,000,000 as
reflected on the Debtors' records.

Mark S. Chehi, Esq., at Skadden Arps Slate Meagher & Flom, LLP,
in Wilmington, Delaware, contends that authorizing the Debtors
to continue to negotiate and consummate Account Settlements in
accordance with the Debtors' ordinary course historical
settlement practices without requiring the Debtors to obtain
Court approval for each proposed Account Settlement will greatly
ease administrative burdens associated with Account Settlements
that otherwise would be imposed on the Debtors and this Court.
Given the great number of Account Settlements that the Debtors
historically resolve on a weekly basis and given the complexity
of and administrative costs associated with the Debtors' cases,
Mr. Chehi argues that authorizing the Debtors to consummate
Account Settlements as proposed without requiring separate Court
approval of each such settlement will conserve scarce judicial
and estate resources and allow the Debtors and their
professionals to focus on more pressing core aspects of the
reorganization process - without distracting or diminishing the
results of the Debtors' historical accounts receivable
collection practices.

The Debtors propose that for Account Settlements of accounts
receivable appearing on the Debtors' records in amounts less
than $1,000,000, the Debtors be authorized to conclude such
settlements without further hearing or notice to parties in
interest. It is further proposed that, for Account Settlements
of accounts receivable appearing on the Debtors' books and
records in amounts equal to or exceeding $1,000,000, but less
than $3,000,000, the Debtors be authorized to conclude such
settlements in accordance with the Notice Procedures, which are
designed to afford all affected parties an opportunity to review
proposed Noticed Account Settlements and, if necessary, object
thereto.

The Debtors propose that for proposed Noticed Account
Settlements, the following procedures will be implemented and
govern in lieu of seeking further Court approvals:

A. The Debtors shall give notice of proposed Noticed Account
   Settlements to the Office of the United States Trustee,
   counsel to the Creditors' Committee and counsel to the DIP
   Lenders. Notices shall be served by facsimile, so as to be
   received on the date of service and shall specify:

       1. the account to be compromised and settled,
       2. the identity of the particular Debtor settling the
          account,
       3. the identity of the claimant,
       4. the terms of the Noticed Account Settlement, and
       5. a brief statement of the basis for the settlement.

B. The Notice Parties shall have 5 business days after the
   Notices are sent to object or to request additional
   information to evaluate the Noticed Account Settlement.

C. The Debtors shall seek Court approval for settlements of
   accounts receivable matters for receivables appearing on
   the Debtors' books and records in amounts equal to or in
   excess of $3,000,000.

D. A Notice Party must submit in writing by facsimile an
   objection to a proposed Noticed Account Settlement, or a
   request for additional time to evaluate or object to such
   settlement, to Skadden, Arps, Slate, Meagher & Flom LLP,
   Four Times Square, New York, New York 10036-6522 (Attn:
   Alan R. Dalsass, Esq.) (Fax: (212) 735-2000), so that such
   objection or request is actually received not later than
   the 5th business day following service of Notice of such
   proposed Noticed Account Settlement. If Skadden Arps
   receives no such written objection or written request for
   additional time to evaluate and object to a proposed
   Noticed Account Settlement prior to expiration of the
   applicable objection period, the proposed Noticed Account
   Settlement shall be deemed consented to by the Notice
   Parties and the Debtors shall be authorized to consummate
   such Noticed Account Settlement.

E. If a Notice Party objects to a proposed Noticed Account
   Settlement within the applicable period after the Notice is
   sent, the Debtors and such objecting Notice Party shall use
   good faith efforts to consensually resolve the objection.
   If the Debtors and the objecting Notice Party are unable to
   achieve a consensual resolution, the Debtors shall not
   proceed with the Noticed Account Settlement pursuant to
   these procedures, but may seek Court approval of the
   Noticed Account Settlement upon notice and a hearing.

F. Nothing in the foregoing Notice Procedures shall prevent the
   Debtors, in their sole discretion, from seeking Court
   approval at any time of any Noticed Account Settlement upon
   notice and a hearing.

Mr. Chehi submits that authorizing the Debtors to consummate
proposed Account Settlements through use of the Notice
Procedures without the necessity of further Court approval
constitutes the most efficient and cost-effective means of
resolving the accounts. Mr. Chehi contends that obtaining Court
approval of each proposed Account Settlement would result in
burdensome administrative expenses such as the time and cost of
drafting, serving and filing pleadings, and the time incurred by
attorneys in preparing for, and appearing at, Court hearings.

Moreover, the Debtors often face stringent time constraints in
meeting the deadlines established by claimants. Mr. Chehi
asserts that the expedited procedures will permit the Debtors to
be responsive to the needs of interested claimants, thereby
guarding against lost settlements, while still providing for a
review of more material Account Settlements by the affected
parties. Mr. Chehi tells the Court that the proposed Notice
Procedures provide an effective mechanism through which the
affected parties can be apprised of the Noticed Account
Settlements, properly evaluate them and if necessary, lodge
objections. (Exodus Bankruptcy News, Issue No. 5; Bankruptcy  
Creditors' Service, Inc., 609/392-0900)


EXODUS COMMS: Resolves Financial Issues with StorageNetworks
------------------------------------------------------------
StorageNetworks, Inc. (NASDAQ: STOR), the world's leading
provider of data storage management software and services, and
Exodus Communications, Inc., the leading provider of managed
hosting services, announced that they have reaffirmed their
cooperative business relationship and resolved all outstanding
financial matters between the companies.

Exodus has agreed to assume all material contracts between
Exodus and StorageNetworks, including the Joint Marketing and
Services Agreement under which StorageNetworks provides services
to customers located in Exodus' Internet Data Centers. The
agreement announced Wednesday ensures that the parties joint
customers will continue to receive uninterrupted storage
services and that the parties will receive the full economic
benefits of the relationship on both a historical and going
forward basis.

StorageNetworks will continue to leverage Exodus' state-of-the-
art data centers to deliver the full spectrum of data storage
solutions, from primary data storage to tape backup and restore
and business continuity solutions, to both existing and new
customers. All services are fully managed and supported by a
comprehensive service level agreement, 24x7 monitoring, an
extensive data storage infrastructure, and StorageNetworksr
STORos(SM) operating system, the industry's only storage-
specific operating system.

According to StorageNetworks' Chief Financial Officer Paul
Flanagan, "We are pleased with the mutually beneficial outcome
of our conversations with Exodus and our continued joint
cooperation. We look forward to continue working with Exodus.
Both companies are committed to providing our customers with
world-class data storage management solutions that address their
needs not only today, but as data requirements continue to grow
in the future."

StorageNetworks, Inc. (NASDAQ: STOR) is delivering the future of
data storage today. We are the world's leading provider of data
storage management services and software. Our unique services
and software enable enterprises, network service providers, and
system integrators to deliver cost-effective solutions to store,
manage, and protect information on a global basis. We simplify
data storage management and empower our customers and partners
with increased control and optimal utilization of their complex
storage environments. StorageNetworks, headquartered in Waltham,
Massachusetts, has offices worldwide.


FEDERAL-MOGUL: Taps Penningtons as Counsel for Overseas Claims
--------------------------------------------------------------
Federal-Mogul Corporation presents their application to employ
and retain Penningtons as their special counsel in connection
with overseas insurance and overseas claims.

James J. Zamoyski, the Debtors' Senior Vice President and
General Counsel, relates that they have selected Penningtons to
serve as their special counsel to represent them in connection
with certain overseas insurance policies and agreements and to
integrate various overseas claims. Over the last year, Mr.
Zamoyski submits that Penningtons has represented the Debtors
and certain of its affiliates and related entities, in
connection with the availability of coverage under the Asbestos
Liability Policy and the Reinsurance Agreement. In connection
with such representation, Mr. Zamoyski contends that Penningtons
have become familiar with the Debtors' business affairs,
historic liability exposures and their related insurance rights
under the Asbestos Liability Policy and the Reinsurance
Agreement, as well as certain asbestos-related claims asserted
against some of the English Debtors in England and arising out
of Africa and other overseas jurisdictions.

Mr. Zamoyski assures the Court that the partners, associates,
senior solicitors and solicitors of Penningtons who will
represent the English Debtors are well qualified to undertake
the matters upon which Penningtons is to be retained. The
Debtors believe that Penningtons' continued representation of
the English Debtors in connection with their insurance rights in
matters related to the Asbestos Liability Policy and the
Reinsurance Agreement, as well as the various asbestos-related
claims asserted against the Debtors in Africa and other overseas
jurisdictions, is essential to the English Debtors' successful
reorganization and will provide a substantial benefit to the
English Debtors and their estates.

Paul Hadow, a partner with the Penningtons, anticipates that
they will provide the legal support required by the Debtors in
connection with various insurance and overseas matters including
advising and representing the Debtors with respect to the
following:

A. advising and counseling the English Debtors regarding their
   rights in connection with the asbestos-related insurance
   policy  between Curzon Insurance Limited and T&N Limited;

B. advising and counseling the English Debtors regarding their
   rights in connection with the reinsurance agreement between
   Curzon and Centre Reinsurance International Company,
   European International Reinsurance Company Limited and
   Muenchener Rueckversicherungs Gesellschaft;

C. advising, counseling and representing the English Debtors
   regarding:

      1. any disputes between the English Debtors and Curzon
         concerning the availability of coverage under the
         Asbestos Liability Policy, and

      2. any disputes with the Reinsurers concerning the
         availability of coverage under the Reinsurance
         Agreement;

D. advising, counseling and representing the Debtors in matters
   arising out of the provisional liquidation of Chester Street
   Insurance Holdings Limited, the agreement between T&N
   Limited and certain of its affiliates and Chester Street
   Insurance Holdings Limited and certain of its then
   affiliates and any contribution claims asserted by Iron
   Trades against T&N Limited;

E. advising, counseling and representing the Debtors in matters
   concerning contribution claims asserted in England by former
   employers against T&N Limited;

F. assisting the English Debtors and their general bankruptcy
   counsel in preparing appropriate legal pleadings and
   proposed orders as may be required in support of positions
   taken by the English Debtors in matters related to the
   Asbestos Liability Policy and the Reinsurance Agreement, as
   well as preparing witnesses and reviewing documents relevant
   thereto;

G. negotiating with Curzon and/or the Reinsurers to secure
   recoveries for such asbestos-related liabilities through
   settlements;

H. managing the English Debtors' relationship and dealings with
   other non-debtor entities that may have rights and
   obligations in connection with such Asbestos Liability
   Policy and Reinsurance Agreement;

I. administering, integrating, negotiating and reporting certain
   asbestos-related personal injury claims asserted against the
   Debtors that allegedly arose outside of the U.S. or the U.K.

J. assisting in the development of a plan of reorganization,
   including advising the English Debtors with respect to any
   issues related to the Asbestos Liability Policy and the
   Reinsurance Agreement or any of the Overseas Claims;

K. rendering such other services as may be in the bests
   interests of the English Debtors in connection with any of
   the foregoing, as agreed upon by Penningtons and the Debtors.

Mr. Hadow relates that Penningtons has also been asked to
provide services directly to the Debtors in connection with the
English Cases, and therefore Penningtons shall be subject to the
sole and exclusive jurisdiction of the English Courts with
respect to the services provided to the Debtors in connection
with the English Cases, including (i) the retention and
remuneration and expenses of Penningtons, and (ii) the liability
of Penningtons to any person or entity in connection with the
English Cases.

Subject to this Court's approval, Mr. Hadow informs the Court
that Penningtons will charge the Debtors for its legal services
on an hourly basis and for reimbursement of all costs and
expenses incurred in connection with these cases. Penningtons'
billing rates currently range from:

   Position               Hourly Rate
   Partners            o195 to o275 (approximately $285 - $405)
   Associates          o165 (approximately $245)
   Solicitors          o130 to o160 (approximately $190 - $235)
   Trinees/Paralegals  o75 to o95 (approximately $110 - $140)

Mr. Hadow informs the Court that Penningtons has received
o40,000 (approximately $60,000) in retainers in connection with
Penningtons's representation of the Debtors in various pre-
petition matters, a portion of which has been applied to pre-
petition outstanding balances. Penningtons estimates that the
remaining balance of its retainer as of the Petition Date will
be o10,000 (approximately $15,000), which shall constitute a
retainer in respect of future services to be rendered and future
disbursements and charges to be incurred.

Mr. Hadow asserts that Penningtons, its partners, associates,
senior solicitors, and solicitors do not represent or hold any
material adverse interest to the Debtors or their estates with
respect to the matters upon which Penningtons is to be employed,
and do not have any connections with the Debtors, their
officers, affiliates, creditors or any other party in interest,
or their respective attorneys, except that:

A. Active unrelated representations to known institutional
   lenders of the Debtors such as Credit Suisse First Boston,
   HSBC Bank PLC, Lloyds TSB Bank PLC, National Westminster
   Bank PLC, and the Royal Bank of Scotland.

B. Active unrelated representation of Puegeot Motor Co., Ltd.,
   one of the Debtors' major customers.

C. Active unrelated representation of Winterarthur International
   and Marsh USA, one of the Debtors major insurers.

D. Active unrelated representation of PricewaterhouseCoopers
   LLP, one of the Debtors' retained professionals. (Federal-
   Mogul Bankruptcy News, Issue No. 4; Bankruptcy Creditors'
   Service, Inc., 609/392-0900)


FISHER COMMUNICATIONS: Intends to Sell Unit's Real Estate Assets
----------------------------------------------------------------
Fisher Communications, Inc. (NASDAQ:FSCI) announced that it
intends to sell the real estate assets held by its subsidiary,
Fisher Properties Inc., in order to focus exclusively on its
broadcasting and media businesses.

Among the properties expected to be included in the sale are
Fisher Business Center (Lynnwood), West Lake Union Center
(Seattle), Fisher Industrial Park (Kent), Fisher Commerce Center
(Kent), and Fisher Industrial Technology Center (Auburn).

Fisher Plaza, the company's digital hub and communications
community, will not be included in the sale since it provides
state-of-the-art infrastructure for Fisher's communications and
media enterprises. The first phase of the facility was completed
in mid-2000, and currently houses a variety of complementary
information technology providers and related ventures, as well
as Fisher-owned KOMO TV and media businesses. The second phase,
which involves an adjacent 100,000 square foot high tech
facility, is scheduled for completion in 2002.

In a meeting Tuesday afternoon with Fisher Properties employees,
Mark A. Weed, President & CEO of Fisher Properties Inc. told
those in attendance that "the quality and operational expertise
resident in our company and at our office and industrial
facilities could provide significant value to the portfolios of
potential buyers."

Fisher Communications President and CEO, William W. Krippaehne
Jr., also present at the meeting, noted that "this proposed
transaction is part of the ongoing restructuring of Fisher that
includes a new company name reflecting our concentration on
communications and media, the recent sale of the flour milling
and food distribution businesses, a major reduction in expenses
for 2002, and substantial changes in organizational structure."
Krippaehne added, "In the final analysis, I believe our decision
to sell these properties, though wrenching, is appropriate and
timely."

Fisher Communications, Inc. is a Seattle-based communications
and media company focused on creating, aggregating, and
distributing information and entertainment to a broad range of
audiences. Its 12 network-affiliated television stations are
located in the Northwest and Southeast, and its 26 radio
stations broadcast in Washington, Oregon, and Montana. Other
media operations include Fisher Entertainment, a program
production and distribution business, as well as Fisher
Pathways, a satellite and fiber transmission provider. Fisher
also specializes in the design and operation of innovative
communications properties, of which Fisher Plaza is the prime
example.

Last month, as reported in the Oct. 29 edition of the Troubled
Company Reporter, Fisher asked its lenders to waive certain
defaults under various credit agreements.  


GENESIS HEALTH: Intends to Waive Wells Fargo Claims Re Wicomico
---------------------------------------------------------------
Genesis Health Ventures, Inc.'s interest in Wicomico/Genesis
ElderCare, LLC n/k/a Peninsula Regional/Genesis Eldercare, LLC
(Wicomico) provides them with (i) GHV at Salisbury's share of
the Wicomico's annual net earnings, and (ii) approximately
$3,634,000 in annual revenues in management and ancillary
service contracts with Wicomico.

Wicomico owns and operates a 370 bed, long term care facility
known as the Salisbury Center located in Salisbury, Maryland
which enjoys one of the highest occupancy rates in the region.
The sole member of Wicomico is a joint venture (PRMC/GEC at
Salisbury Center LLC) which is 50% owned by GHV at Salisbury
Center, Inc., a non-Debtor, wholly-owned subsidiary of GHV, and
50% owned by PRLTC, Inc., an entity unrelated to the Debtors.

The Facility is situated in proximity to Peninsula Regional
Medical Center which is owned by the parent entity of the joint
venture partner PRLTC and is a major hospital in the area. The
location of the Facility and Wicomico's excellent working
relationship with Peninsula Regional has provided a steady
transition of patients requiring post acute services from
Peninsula Regional to the Facility.

In addition, GHV and certain of its subsidiaries enjoy annual
revenues aggregating approximately $3,634,000 through multiple
agreements with Wicomico and Peninsula Regional, as follows:

      (1) a management agreement between Wicomico and GENS
producing approximately $400,000 in annual revenue;

      (2) a dietary and clinical therapy services agreement
between Genesis ElderCare Hospitality Services, Inc. and
Wicomico producing approximately $104,000 in annual revenue;

      (3) a pharmaceuticals and medical supply services contract
between Wicomico and ASCO Healthcare, Inc. d/b/a NeighborCare,
producing approximately $1,460,000 in annual revenue;

      (4) a rehabilitation services contract between Wicomico
and Genesis ElderCare Rehabilitation Services, Inc. producing
approximately $1,590,000 in annual revenue; and

      (5) a respiratory services agreement between Wicomico and
Respiratory Health Services, LLC producing approximately $80,000
in annual revenue.

Furthermore, the Debtors, through GHV at Salisbury, have
benefited from Wicomico's financial performance. Wicomico is
projected to earn pre-tax net income of approximately $670,000
for fiscal year ending September 30, 2001. The Debtors project
that Wicomico's strong financial performance will continue in
the foreseeable future.

     Claims By Wells Fargo Bank and The Settlement Agreement

Wicomico, as borrower, and Morgan Guaranty Trust Company of New
York (Morgan), as lender, are party to a Fixed Rate Note dated
as of August 24, 1999, in the principal amount of $14 million
(the Mortgage Loan). The Note and obligations under the Mortgage
Loan are secured by substantially all of the assets of Wicomico
under the Purchase Money Deed of Trust and Security Agreement,
dated as of August 24, 1999. The current outstanding principal
amount owed by Wicomico under the Mortgage Loan is $13,470,412.

Morgan's rights and duties under the Loan Documents were
transferred to J.P. Morgan Commercial Mortgage Finance Corp.
(J.P. Morgan), pursuant to a Mortgage Loan Purchase Agreement,
dated as of January 1, 2000, by and between Morgan and J.P.
Morgan.

Pursuant to that certain Pooling and Servicing Agreement, dated
as of January 1, 2000, for Mortgage Pass-Through Certificates,
Series 2000-C9, as may be amended, J.P. Morgan securitized its
interest in the Loan Documents, as well as other secured
mortgage loans, unrelated to the Mortgage Loan, by depositing
the same into a Trust Fund, and appointing Wells Fargo Bank
Minnesota, National Association f/k/a and successor by merger to
Norwest Bank Minnesota, National Association (Wells Fargo Bank),
as Trustee, and ORIX Capital Markets, LLC f/k/a ORIX Real Estate
Capital Markets, LLC (ORIX), as Master Servicer and Special
Servicer.

Included in the Loan Documents is a guaranty agreement executed
by GHV in favor of Morgan, guaranteeing certain obligations.

Wells Fargo Bank asserts that the filing of the Debtors' chapter
11 cases constituted an event of default under the Note pursuant
to the terms of the Security Agreement and that such event of
default has, among other things, triggered GHV's obligations
under the Guaranty and Wicomico's obligation to repay the
Mortgage Loan under the Note. The Debtors and Wicomico dispute
the existence of an event of default under any of the Loan
Documents.

To resolve the claims asserted by Wells Fargo Bank, GHV, GENS,
and ORIX, as Special Servicer for Wells Fargo Bank, entered into
that a Settlement Agreement, dated as of August 30, 2001, which,
inter alia, provides for:

(1) the modification of the Guaranty with respect to the
    Guaranteed Obligations so as to delete any circumstance
    which would obligate GHV to repay the underlying Mortgage
    Loan,

(2) the obligation by the Debtors to assume the Management
    Agreement pursuant to section 365 of the Bankruptcy Code,

(3) an agreement by the parties that the Plan neither provides
    for nor effects a discharge of GHV's obligations under the
    Guaranty, as modified by the Settlement Agreement,

(4) the waiver of certain claims by Wells Fargo Bank against GHV
    and GENS under the Loan Documents,

(5) the withdrawal by Wells Fargo Bank of its Proofs of Claim in
    the Debtors' chapter 11 eases, dated August 27, 2000,
    December 18, 2000, and August 22, 2001,

(6) the payment by the Debtors to Wells Fargo Bank of reasonable
    fees and costs incurred by Wells Fargo Bank in connection
    with the Settlement Agreement (the "Fees and Costs"), and

(7) the waiver of any and all claims by GHV and GENS against
    Wells Fargo Bank.

The Debtors are not aware of any claims GHV or GENS may have
against Wells Fargo Bank. However, in an abundance of caution,
by this Motion, GHV and GENS request approval to waive the
Claims against Wells Fargo Bank.

The Debtors estimate that the Fees and Costs will aggregate an
amount not to exceed $15,000.

The Debtors believe that Ample cause exists for authorizing GHV
and GENS to waive the Claims against Wells Fargo Bank and pay
the Fees and Costs.

First, the waiver and payment are essential components of the
Settlement Agreement which is necessary in order for the Debtors
to continue to reap the benefits of their interest in Wicomico.

Second, inasmuch as Wells Fargo Bank has maintained that the
filing of the Debtors' chapter 11 cases constituted an event of
default under the Note pursuant to the terms of the Security
Agreement and that such event of default has, among other
things, triggered GHV's obligations under the Guaranty and
Wicomico's obligation to repay the Mortgage Loan under the Note,
should GHV and GENS refuse to waive the Claims against Wells
Fargo Bank or pay the Fees and Costs, the Settlement Agreement
would unravel which could possibly trigger Wells Fargo Bank's
foreclosure of the Mortgage Loan causing substantial harm to the
value of the Debtors' interests in Wicomico.

Third, the Debtors will not be prejudiced or harmed by the
waiver by GHV and GENS of the Claims against Wells Fargo Bank.
The Debtors submit that they are not aware of any claims against
Wells Fargo Bank, and therefore, there is minimal risk that the
Debtors are actually "using" property of the estate under
section 363(b)(1) of the Bankruptcy Code by waiving any Claims.

In addition, the amount of the Fees and Costs are de minirnus
when weighed against the substantial benefits the Debtors
receive from their interest in Wicomico.

Moreover, the Settlement Agreement was negotiated by the parties
in good faith and its terms falls within the range of
reasonableness.

The Debtors submit that the waiver of the Claims against Wells
Fargo Bank and the payment of the Fees and Costs are a valid
exercise of the Debtors' business judgment and is in the best
interests of the Debtors, their creditors, and all parties in
interest.

Accordingly, the Debtors seek the Court's authority, pursuant to
section 363(b)(1) of the Bankruptcy Code and Bankruptcy Rule
9019, to (a) waive claims against Wells Fargo Bank, and (b) pay
reasonable fees and costs pursuant to Settlement Agreement with
Wells Fargo Bank in connection with Wicomico Joint Venture.
(Genesis/Multicare Bankruptcy News, Issue No. 16; Bankruptcy
Creditors' Service, Inc., 609/392-0900)   


GENTEK INC: Says Third Quarter Performance "Essentially Flat"
-------------------------------------------------------------
For the three months ended Sept. 30, 2001, GenTek (NYSE: GK)
reported revenues of $299.7 million compared with $362.4 million
for the corresponding period of 2000.  Excluding restructuring
charges and other adjustments, earnings before interest, taxes,
depreciation and amortization (EBITDA) were $35.7 million
compared with $63.7 million for the third quarter of 2000.

Third quarter adjusted EBITDA excludes restructuring charges of
$2.9 million ($1.8 million after tax) principally related to
employee severance in the communications segment, and also
excludes $2.4 million ($1.4 million after tax) of costs related
to the operation of two, non-core research and development
facilities, which will be closed during the fourth quarter.  
Adjusted EBITDA for the third quarter of 2000 excludes a one-
time charge of $5.8 million ($3.5 million after tax).

The company's third-quarter results were negatively affected by
the continuing and severe downturn in the U.S.
telecommunications industry, as well as by lower volumes and
pricing in the North American automotive industry relative to
last year.

On a sequential basis, the company's third-quarter performance
was essentially flat compared with the prior quarter and was
consistent with the company's previous guidance that adverse
market conditions would continue for the remainder of 2001.

According to GenTek chairman Paul M. Montrone, "This quarter's
restructuring charge, in addition to the charge taken during the
second quarter, firmly demonstrates our resolve to align
GenTek's headcount and infrastructure with current economic
conditions. Additional charges may be taken in future quarters
as we continue tailoring the cost structure of our businesses to
deliver improved earnings and cash flow under current economic
conditions.  We are prudently managing our businesses under the
assumption that the level of business activity experienced
during recent quarters will continue."

Consistent with GenTek's outlook for the next several quarters,
the company has aggressively managed its capital spending and
now expects full-year capital expenditures to approximate $85
million, down $20 million from previous guidance.  As a result,
the company expects its year-end total debt balance to be at or
below third-quarter levels.

The company recorded net income of $0.2 million for the third
quarter. Excluding the adjustments previously discussed, net
income was $3.4 million compared with net income of $15.2
million in the third quarter of 2000.

For the first nine months of 2001, GenTek posted net sales of
$959.1 million compared with sales of $1,070.1 million for the
corresponding period of last year.  Excluding the year-to-date
effect of the adjustments previously discussed, and asset
impairment and other charges recorded during the second quarter,
net income was $8.5 million, compared with $45.1 million for the
first nine months of 2000.  Adjusted EBITDA through the first
nine months of 2001 was $122.0 million, compared with $184.9
million for the same period of last year.

GenTek Inc. is a technology-driven manufacturer of
communications products, automotive and industrial components,
and performance chemicals.  A global leader in a number of
markets, GenTek provides state-of-the-art connectivity solutions
for telecommunications and data networks, precision automotive
valve-train components, and performance chemicals for
environmental, technology, pharmaceutical and chemical-
processing markets. Additional information about the company is
available on GenTek's Web site at http://www.gentek-global.com

                            *  *  *

Fitch has lowered GenTek's senior secured debt rating to `BB-'  
from `BB' and lowered the company's senior subordinated debt  
rating to `B-' from `B+'.

The senior secured debt rating of `BB-' applies to the company's  
$800 million senior secured bank facility and the senior  
subordinated debt rating of `B-' applies to the company's $200  
million of outstanding senior subordinated notes due 2009. The  
Rating Outlook is Negative.

The original senior secured credit facility agreement contains  
various restrictions and covenants, including financial tests as  
measured by total debt-to-EBITDA (less than 5.0 times) and  
EBITDA-to-interest (greater than 2.5x).  

The company's senior secured credit facility was amended Aug. 9,  
2001. Prior to the amendment, secured creditors had security in  
common stock (equity). Under the current temporary amendment,  
secured creditors will receive security in substantially all  
assets of GenTek.  

Fitch has increased the notching between the secured debt and  
the subordinated debt from two notches to three notches to  
reflect the increased security and weaker overall credit  
profile. Under the temporary amendment, financial covenants have  
been relaxed through Dec. 31, 2002. If GenTek is able to improve  
credit statistics to the levels mentioned above before Dec. 31,  
2002, the terms of the credit agreement will revert to the  
original terms.


HOUSE2HOME INC: NYSE Suspends Shares After Bankruptcy Filing
------------------------------------------------------------
House2Home, Inc. said that it has been notified by the New York
Stock Exchange (NYSE) that trading in the common stock of the
company (NYSE:HTH) has been suspended.

House2Home filed Wednesday voluntary petitions under Chapter 11
of the Federal Bankruptcy Code and confirmed it has also filed a
motion with the Bankruptcy Court for authorization to liquidate
and cease operating all 42 of its stores. Accordingly, the
company said it will not appeal the NYSE's action, and
understands that application will be made by the NYSE to the
Securities and Exchange Commission to delist the issue.

The NYSE cited House2Home's Chapter 11 filing and the fact that
the company's shares have had an average closing price of less
than $1.00 per share for more than 30 consecutive days as
reasons for the suspension.

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


HOUSE2HOME: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------
Lead Debtor: House2Home Inc.
             3345 Michelson Drive
             Irvine, CA 92612

Chapter 11 Petition Date: November 7, 2001

Court: Central District of California (Sta. Ana)

Bankruptcy Case No.: 01-19244

Affiliates Filing Separate Chapter 11 Petition:

    Entity                         Case No.
    ------                         --------
    HBCA 1993 Realty Corporation   01-19245
    Homeclub Inc.                  01-19246
    HBOR Realty Corporation        01-19247
    HBNM 1994 Realty Corporation   01-19248
    Homeclub Inc of Texas          01-19249
    HBUT Realty Corporation        01-19250
    HCWA 1993 Realty Corporation   01-19251
    Fullerton Corporation          01-19252
    HBCO Realty Corporation        01-19253
    HBCA Vacaville Realty
    Corporation                    01-19254
    HBCO 1994 Realty Corporation   01-19255
    HCI Development Corporation    01-19256
    HBCA Pomona Realty Corporation 01-19257
    HBNM Realty Corporation        01-19258
    HCCA Realty Corporation        01-19259
    HCWA Realty Corporation        01-19260
    Homeclub First Realty Corp     01-19261

Type of Business: Headquartered in Irvine, California,
                  House2Home, Inc. is one of the West's leading
                  home furnishings retailers, operating 42
                  House2Home home decorating superstores in  
                  California, Arizona, and Nevada.

Judge: James N. Barr

Debtors' Counsel: Oscar Garza, Esq.
                  Gibson, Dunn & Crutcher
                  4 Park Plaza Ste 1400
                  Irvine, CA 92614-8557
                  Tel: 949-451-3800
                  Fax: 949-451-4220

Total Assets: $181,244,162

Total Debts: $192,961,553

Debtor's 20 Largest Consolidated Unsecured Creditors:

Entity                      Nature Of Claim       Claim Amount
------                      ---------------       ------------
State Street Bank and       Indenture Trustee:    $90,200,000
Trust Company of            51/4% Covertible
California, N.A.            Subordinated Notes
Scott C. Emmons             due November 1,2004
Vice President
633 West 5th Street
12th Floor
Los Angeles, CA 90071
Tel: 213-362-7369
Fax: 213-362-7357

Palisades Media Group,      Trade                  $1,716,101
Inc.  
Mercedes Tondre
1620 26th Street, #2050N
Santa Monica, CA 90404
Tel: 310-828-9100
Fax: 310-828-1805

Carat ICG                   Trade                  $1,614,472
Adrian Nash
2450 Colorado Avenue
Suite 300 East
Santa Monica, CA 90404
Tel: 310-255-1415
Fax: 310-255-1056

Masa Energy Systems         Trade                    $938,014
Charlie Fletcher
5 Vanderbilt
Irvine, CA 92618
Tel: 949-460-0460
Fax: 949-460-8812

Camco Pacific Constr.       Trade                    $641,379
Co. Inc.
Jeff Thompson
959 South Coast Drive, #450
Costa Mesa, CA 92626
Tel: 714-424-9500
Fax: 714-424-9600

Desa International          Trade                    $551,475
Mark Kline
2701 S. Harbor Blvd.
Santa Ana, CA 92704
Tel: 714-549-7060
Fax: 714-557-3819

UMA Enterprises Inc.        Trade                    $442,025
(D161)
Rattan
1300 West Artesia Boulevard
Compton, CA 90220
Tel: 310-631-1166
Fax: 310-631-2124

Treasure Chest              Trade                    $414,945
Advertising, Inc.
Hill Hale
250 West Pratt Street
18th Floor
Baltimore, MD 21201
Tel: 909-689-1122
Fax: 909-687-4342

Cord Crafts, Inc.           Trade                    $367,086
Alan Gordoni
2055 Main Street
Irvine, CA 92714
Tel: 949-724-9500
Fax: 949-724-9509

RAS Builders, Inc.          Trade                    $363,814
Wally Clark
13316 Mapledale Street
Norwalk, CA 90650
Tel: 562-404-9096
Fax: 562-404-8684

Design Accessories          Trade                    $320,193
International
Dean Brown
1099 Baker Street, Bldg. B
Costa Mesa, CA 92626
Tel: 714-241-8111
Fax: 714-241-9609

Nalco Products Corp.        Trade                    $311,202
Michael Litner
33 Factor Street
West Warwick, RI 02893
Tel: 800-828-8906
Fax: 401-823-7670

Norcal Pottery              Trade                    $297,245
Larry Bourland
2091 Williams Street
PO Box 1628
San Leandro, CA 94577
Tel: 510-895-5966
Fax: 510-483-0946

Sunbeam (Dept. 171)         Trade                    $289,859
David Brown
2381 Executive Center Drive
Boca Raton, FL 33431
Tel: 561-912-4637
Fax: 561-912-4567

Encompass Cleaning          Trade                    $286,959
System, Inc.
Randy Novac
1052 Grand Avenue, Suite E
Arroyo Grande, CA 93420
Tel: 800-649-9587 x 5202
Fax: 805-481-5060

FIGI (Dept 161-Elaine       Trade                    $282,808
Turney)
Janis Deady
3636 Gateway Center
San Diego, CA 92102
Tel: 858-824-9491
Fax: 858-824-9490

Kirsch/Newell Window        Trade                    $221,178
Furnishings

Noval Controls Corp.        Trade                    $217,196

Shaw Ind. S/O               Trade                    $203,591

O'Sullivan Industries Inc.  Trade                    $199,643


IMAGEMAX: Redirection in Operation Sees Decline in Revenue Trend
----------------------------------------------------------------
ImageMax, Inc. (OTCBB:IMAG) announced results for the quarter
and nine months ended September 30, 2001. Revenues, operating
loss, and net loss amounted to $10.6 million, $0.2 million, and
$0.6 million, respectively, for the quarter ended September 30,
2001, compared to $14.0 million, operating income of $0.4
million, and net loss of $0.1 million in the third quarter of
2000.

Revenues, operating income, and net loss amounted to $36.2
million, $0.1 million, and $1.2 million, respectively, for the
nine months ended September 30, 2001, compared to $44.7 million,
$2.4 million, and net income of $0.7 million in the first nine
months of 2000.

Earnings before interest, taxes, depreciation, and amortization
(EBITDA) and interest coverage (EBITDA divided by interest
expense), respectively, were $0.7 million and 1.9 for the
quarter ended September 30, 2001, $1.4 million and 2.6 for the
quarter ended September 30, 2000, and $4.2 million and 2.4 for
the trailing 12 month period from October 1, 2000 to September
30, 2001. EBITDA and interest coverage, respectively, were $2.9
million and 2.3 for the nine months ended September 30, 2001,
and $5.3 million and 3.2 for the nine months ended September 30,
2000. The ratio of debt to equity was 41% as of September 30,
2001 as compared to 47% as of December 31, 2000 and September
30, 2000.

Mark P. Glassman, Chief Executive Officer, commented, "In the
third quarter, we continued to make considerable progress under
our Strategic Plan. Our declining revenue trend is a result of
the extensive changes undertaken during the past 12 months, most
notably a transition towards digital based services in order to
satisfy customer needs and to redirect certain operations from
declining analog business. This transition necessitated a number
of changes in sales and delivery methods, including a
substantial turnover of the sales force that has occurred since
April. These efforts have yielded an expanded knowledge base,
enhanced products and services, and a national delivery model
that we believe positions ImageMax as a uniquely qualified
nationwide provider of document management solutions.

"As we move forward, the Company has a significant pipeline that
includes an array of data capture, software, and ASP based
services (via ImageMaxOnline) encompassing a number of
applications and vertical markets. Our ability to deliver a
complete solution - from data capture to workflow to online
retrieval - is an important differentiator in the marketplace,
particularly as more companies focus on core competencies and
seek strategic outsourcing partnerships in governing day-to-day
document management activities. During the next six months, we
believe that the recent widespread changes within our sales
force will take full effect and allow the Company to capitalize
on this momentum as we plan for revenue and profitability growth
in 2002.

"We are also excited at the opportunities around the release of
our ScanTRAX 4.0 capture software scheduled for the first
quarter of 2002. This software will complement an established
and reliable product in ScanTRAX Retrieval, providing a cost
effective means of converting and retrieving documents. The
Company intends to expand the marketing and distribution of
these products within service bureau and reseller channels, as
well as to standardize internal production facilities, which we
believe will yield long-term efficiencies.

"Operationally, we have closely managed production costs and
administrative expenditures. Gross margin percentage has
improved in connection with our transition towards digital based
services and efforts to maximize analog results. Our ability to
maintain or improve performance in these areas has been central
to generating operating cash flows used to de-leverage the
Company. Operating cash flows also continue to support sizeable
investments in sales and marketing, which includes revamping the
sales force (principally in order to sell a complete range of
digital based services) and expenditures relating to sales
automation tools, formal training programs, telemarketing, and
trade shows. Also, we have substantially completed the
transformation of our organization and management structure that
began in 2000 that emphasizes our objective to serve a broad
spectrum of customers seamlessly and on a national scale."

David B. Walls, Chief Financial Officer, added, "From a finance
perspective, although we incurred a technical default under our
senior credit agreement as of September 30 (relating to EBITDA
and net worth covenants), we funded all required debt service in
the quarter through operating cash flows. In addition, we expect
to further reduce our senior debt by $950,000 in the fourth
quarter, which includes $400,000 in proceeds received from the
sale of a non-strategic box storage unit in October. Moreover,
we have maintained a positive working relationship with our
lenders and anticipate revising the terms of the senior credit
agreement prior to the end of 2001, which the Company views as
favorable."

ImageMax is a leading provider of document management services
and products that enable clients to more efficiently capture,
index, and retrieve documents across a variety of media,
including the Internet. The Company operates from 30 facilities
across the country.

At the end of September, ImageMax had a working capital deficit
of $1.3 million, with cash and cash equivalents amounting to
$595,000, while its debts totaled almost $15 million.


LOEWEN: Amends Michigan Cemetery Asset Purchase Agreement
---------------------------------------------------------
Prior to the commencement of their chapter 11 cases, Loewen
Group and certain of its debtor-affiliates consummated 13
transactions by which they transferred to the LLCs certain
rights with respect to cemeteries located in the State of
Michigan. After the petition date, certain disputes arose
between The Loewen Group, Inc. and the LLCs. To resolve these
disputes, the parties entered into a Settlement Agreement and
obtained the Court's approval of it. However, other disputes
continued to exist between the parties regarding the legal
effect of the prepetition sale transactions and the parties'
performance thereunder. The Selling Debtors commenced a lawsuit
with respect to the post-settlement disputes. Notwithstanding
the disputes and legal proceedings, discussions went on between
the parties.

These culminated in the Prior Michigan Sale Motion in which the
Debtors sought and obtained the Court's approval to sell assets
of the Michigan Cemeteries to the LLCs at a purchase price of
$23,450,000 pursuant to the Original Purchase Agreement.

The transactions approved by the Prior Sale Order did not close.
Moreover, the Selling Debtors have been advised by the LLCs that
the LLCs have been unable to obtain financing to close the
transactions approved by the Prior Sale Order and are highly
unlikely to be able to obtain such financing in a timeframe
acceptable to the Selling Debtors. As a result, the Selling
Debtors and the LLCs have agreed to amend the Original Purchase
Agreement in several respects, including amendments to:

(a) reduce the purchase price by $1,450,000, from $23,450,000 to
    $22,000,O00; and

(b) provide that $15,000,000 of the purchase price will be paid
    by means of secured, interest-bearing Promissory Notes
    subordinate to the secured claims of Comerica Bank.

In addition, the parties seek to enter into the Credit Agreement
to govern the parties' rights with respect to the $15,000,000 of
Promissory Notes.

Moreover, the Selling Debtors are seeking approval of their
entry into an intercreditor agreement with Comerica Bank
pursuant to the Intercreditor Agreement Term Sheet. As explained
in the Prior Michigan Sale Motion, the LLCs are borrowers under
loans now held by Comerica Bank that are secured by
substantially all the personal property assets of the LLCs. The
Debtors are seeking to enter into an intercreditor agreement in
order to obtain the consent of Comerica Bank to the transactions
proposed by this Motion and to clarify the parties' respective
rights.

Finally, notwithstanding the revised transactional structure,
the Amended Purchase Agreement and the Termination Agreement
would terminate the parties' prior agreements, including the
Settlement Agreement, and would resolve most of the disputes
between the Debtors and the LLCs, as described in the Prior
Michigan Sale Motion.

The Debtors submit, in the exercise of their business judgment,
that entry into the Amended Purchase Agreement, the Credit
Agreement, the Termination Agreement and the intercreditor
agreement is in the best interests of their estates and
creditors and should be approved, pursuant to sections 363 and
365 of the Bankruptcy Code and Bankruptcy Rule 9019. Among other
things, the Selling Debtors note that their entry into the
Amended Purchase Agreement and the Termination Agreement will
result in the receipt of $7,000,000 in cash, the Promissory
Notes in the aggregate principal amount of $15,000,000 and the
release of most of the claims that the LLCs, Bush and their
affiliates may have against the Selling Debtors and their
affiliates. Moreover, the Termination Agreement will bring final
resolution to other contentious disputes and leal proceedings
between the parties.

By this Motion, the Selling Debtors seek the entry of an order
authorizing the Selling Debtors to:

(A) sell the Assets to the LLCs on the terms set forth in the
    Amended Purchase Agreement, free and clear of all liens,
    claims, encumbrances and other interests, pursuant to
    sections 363(b) and 363(f) of the Bankruptcy Code;

(B) assume and assign the Assignment Agreements to the LLCs,
    pursuant to section 365 of the Bankruptcy Code;

(C) enter into the Termination Agreement, the Credit Agreement
    and an intercreditor agreement on substantially the terms
    set forth in the Intercreditor Agreement Term Sheet; and

(D) enter into all related agreements and transactions. (Loewen
Bankruptcy News, Issue No. 48; Bankruptcy Creditors' Service,
Inc., 609/392-0900)


LOEWS CINEPLEX: Beats Landlord out of $500K of Annual Rent
----------------------------------------------------------
Loews Cineplex Entertainment Corporation (LCE) asks the United
States Code of the Southern District of New York to authorize
Plitt Theatres, Inc. (Plitt), one of the Debtors, to assume an
the amended, unexpired nonresidential real property lease
located in Seattle, Washington.

The Debtors paid to the Meridian Landlord were substantial
making the Theatre being only marginally profitable for the
Debtors. Under the terms of the Original Lease, the Rental
Charges the Debtors paid to the Meridian Landlord were
approximately $1,538,834 per annum. The Amended Lease reduces
the base rent paid by the Debtors to the Meridian Landlord by
approximately $480,000 per year which reduction will increase
over time as the Amendment eliminates base rent increases
scheduled for December 1 of 2001, 2006 and 2011. In exchange for
such reduction, the Meridian Landlord has agreed to accept a
greater share of the gross sales of the Theatre in excess of
certain thresholds set forth in the Amendment. As a result,
because of the significant reduction in the Rental Charges under
the Amended Lease, the Debtors believe that the profitability of
the Theatre will increase and that the Theatre should become a
significant cash contributor for the Debtors.

In addition, under the terms of the Amended Lease, the initial
term of the lease will expire on or before November 20, 2016;
this is a five year reduction of the initial term of the lease
pursuant to the Original Lease. Under the terms of the
Amendment, the tenant will have the option to extend the term
for two five-year extension periods.

Moreover, from and after November 30, 2006, if the annual
attendance and average annual gross sales over a three-calendar
year period fall below certain levels, then the Debtors may
terminate the Amended Lease upon 30 days' written notice. The
Amended Lease therefore provides the Debtors with the necessary
flexibility so that if the Theatre performs below the Debtors'
expectations, the Debtors may elect to terminate the Amended
Lease.

The reduced rent and the reduction in the initial lease term,
combined with the option to terminate based on the performance
of the Theatre, will together provide the Debtors with a
profitable theatre and the necessary flexibility to exit the
Amended Lease if the cash flows decline.

Loews Cineplex Entertainment Corporation is a major motion
picture theatre exhibition company with operations in North
America and Europe, filed for chapter 11 protection on February
15, 2001 in the Southern District of New York. Brad Eric
Scheler, Esq., Janice MacAvoy, Esq. at Fried, Frank, Harris,
Shriver & Jacobson represents the Debtors in their restructuring
effort.


MARINER POST-ACUTE: Solicits Bids for Pharmaceutical Business
-------------------------------------------------------------
           IN THE UNITED STATES BANKRUPTCY COURT
               FOR THE DISTRICT OF DELAWARE

In re                        )      Chapter 11
MARINER POST-ACUTE           )      Case Nos.
NETWORK, INC., et al.        )      00-0013-00214 (MFW)
          Debtors            )      (jointly administered)
-----------------------------)   
                             )
In re                        )      Chapter 11
MARINER HEALTH GROUP.        )      Case Nos.
INC., et al.                 )      00-00215-00301 (MFW)
        Debtors              )      (jointly administered)

           NOTICE OF SALE OF ASSETS AND OF DEADLINES
                FOR SUBMISSION OF CONFORMING
               OVERBIDS OR OBJECTIONS TO SALE

     Under the name American Pharmaceutical Services, certain of
the Debtors in the above-captioned cases own and operate one of
the largest institutional pharmacies in the United States  (the  
"Debtors" Pharmaceutical Business"), consisting of thirty-three
pharmacies that provide pharmacy products and services to
approximately 1,500 facilities.  As provided in the "MOTION
UNDER 11 U.S.C. Secs. 105 (a), 363, 364, 365 AND 1146 AND FED.
R. BANKR. P. 2002, 4001, 6004,6006, 9014 AND 9019 TO (A) SELL
DEBTORS' PHARMACEUTICAL BUSINESS FREE AND CLEAR OF LIENS AND
ENCUMBRANCES PURSUANT TO SALE PROCEDURES ORDER; (B) INCUR
INDEBTEDNESS AND COMPROMISE CLAIMS IN CONNECTION THEREWITH; (C)
ASSUME AND ASSIGN EXECUTORY CONTRACTS AND UNEXPIRED LEASES IN
CONNECTION THEREWITH; AND (D) GRANT RELIEF RELATED THERETO'
filed October 16, 2001, in the above-captioned cases (the
"Motion"), and subject to the procedures established by the
Bankruptcy Court for overbidding and an auction, the Debtors
propose to sell the assets comprising the Debtors'
Pharmaceutical Business free and clear of all liens,
encumbrances and claims, and to assume and assign numerous
executory contract and unexpired leases in connection therewith,
to Genesis Health Ventures, Inc. and NeighborCare Pharmacy
Services, Inc. pursuant to an Asset Purchase Agreement for a
cash payment at closing of $42,000,000 and payments over three
years totally $18,000,000, abject to adjustments as provided in
the Asset Purchase Agreement.  Any overbid by any other
interested purchaser for the Debtors' Pharmaceutical Business
must equal or exceed a cash payment at closing of at least
$44,5000,000, provide for payments over three years totaling at
least $18,000,000, and otherwise be in conformance with the
requirements set forth in the Motion and in the "ORDER GRANTING
MOTION TO (1) ESTABLISH BIDDING PROCEDURES FOR SALE OF DEBTORS'
PHARMACEUTICAL BUSINESS; (2) APPROVE BREAK-UP FEES; AND (3) SELL
ASSETS FREE AND CLEAR OF BANK LIEN" entered by the Bankruptcy
Court on October 16, 2001 (the "Overbid Order").

     PLEASE TAKE NOTICE that any conforming overbids, and
responses or objections to the Motion, including objections to
the sale of assets free and clear of liens or the assumption and
assignment of executory contracts and unexpired leases in
connection therewith, must be in writing, filed with the Clerk
of the United States Bankruptcy Court for the District of
Delaware, 824 Market Street, Wilmington, Delaware 19801, and
served upon and received by the undersigned counsel and certain
other parties in interest on or before 4:00 p.m. on November 21,
2001, all as more fully detailed in the Overbid Order and the
Motion.
     PLEASE TAKE FURTHER NOTICE that if conforming and qualified
overbids are received in compliance with the overbid Order, an
auction of the Debtors' Pharmaceutical Business is tentatively
scheduled to take place in the offices of Ashby & Geddes, 222
Delaware Avenue, Wilmington, Delaware 19899 on December 4, 2001,
at 10:00 a.m. in conformance with the Overbid Order.  All
interested buyers submitting conforming initial overbids should
be prepared to submit their highest and best offers at the time
of the auction.

     PLEASE TAKE FURTHER NOTICE that a hearing (the "Hearing")
on the Motion will be convened at the United states Bankruptcy
Court for the District of Delaware, 824 Market Street
Wilmington, Delaware 19801 (the "Bankruptcy Court") on December
5, 2001, at 2:00 p.m. to confirm the result of the auction (if
held) and to hear and determine any and all timely filed and
served objections to the relief requested in the Motion.

     Complete copies of the Motion, the Overbid Order and a
bidding package, including the required form of generic asset
purchase agreement to be used by over bidders and required
service lists, are available upon written or facsimile request
to William P. Bowden at the address set forth below:

                                    /s/
                               -------------------------
                               WILLIAM P. BOWDEN
                               ASHBY & GEDDES
                               222 Delaware Avenue
                               P.O. Box 1150     
                               Wilmington, DE 19899
                               Telephone:  (302) 654-1888
                               Facsimile:  (302) 654-2067
                               Attorneys for Debtors


                                    /s/
                               -------------------------
                               ALAN PEDLAR
                               STUTMAN, TREISTER & GLATT     
                               PROFESSIONAL COPRORATION
                               3699 Wilshire Boulevard, 9th Flr.
                               Los Angeles, California 90010
                               Telephone:  (213) 251-5100
                               Facsimile:  (213) 251-5288     
                               Attorneys for Debtors


MERISTAR HOTELS: Posts $1.6MM Net Loss On $77MM Revenues In Q3
--------------------------------------------------------------
MeriStar Hotels & Resorts (NYSE: MMH), the nation's largest
independent hotel management company, announced results for the
third quarter ended September 30, 2001.

For comparative purposes, the results for the three and nine
months ended September 30, 2000 are presented on a pro forma
basis as if the company's 106 leases with MeriStar Hospitality
Corporation (NYSE: MHX) that were converted to management
contracts on January 1, 2001 had been converted on January 1,
2000.

Third-quarter revenues for 2001 decreased 9.2 percent to $77.6
million. Excluding non-recurring items, net loss for the quarter
was $1.6 million, compared to net income of $2.8 million in the
2000 third quarter. Recurring earnings before interest, taxes,
depreciation and amortization (EBITDA) were $3.0 million,
compared to $9.7 million in the 2000 third quarter.

During the third quarter, the company recorded the following
non-recurring charges:

     --  $0.8 million of costs related to the write-down of
certain accounts receivable.

     --  $0.9 million of costs related to restructuring within
the BridgeStreet Corporate Housing Worldwide subsidiary and the
closing of operations in four secondary corporate housing
markets.

Same-store revenue per available room (RevPAR) for all full-
service managed hotels in the 2001 third quarter declined 15.5
percent to $66.29. Occupancy declined 11.2 percent to 65.9
percent and average daily rate (ADR) fell 4.9 percent to
$100.54. Same-store RevPAR for all limited-service, leased
hotels in the 2001 third quarter declined 9.2 percent to $50.95.
ADR rose 1.0 percent to $79.64, and occupancy decreased 10.1
percent to 64.0 percent.

"The terrible and unprecedented events of September 11 have had
an immediate and far-reaching impact on the hospitality
industry," said Paul W. Whetsell, chairman and chief executive
officer of MeriStar. "We were already in a difficult operating
environment with the economy weakening steadily since the first
quarter. We have been working closely with our owners to
optimize revenues and profitability and protect margins while
continuing to provide superior guest service."

MeriStar's BridgeStreet corporate housing operations accounted
for approximately half of the earnings decline as the slowing
U.S. economy and the terrorist attacks combined to sharply
curtail corporate travel. "The nature of the corporate housing
business allows us to expand and contract our inventory as
conditions warrant. We ceased operations in four smaller
secondary markets in the third quarter and have reduced
inventory in other U.S. markets," he said. "On a positive note,
we continue to see growth opportunities in Europe and opened our
first office in Paris during the third quarter."

The sluggish economy prior to and after the September 11 events
also had a negative impact on earnings at managed hotels.
MeriStar's managed hotels' results were most negatively
influenced by a sharp reduction in business travel, especially
meetings and convention business.

"RevPAR declined dramatically immediately after the attacks as
all travel came to a near halt," he said. "Occupancy has
improved from 47 percent at our full-service hotels the week
after the terrorist attacks to 67 percent in the last week of
October, but a return to more normal conditions continues to be
hampered by fears of additional attacks and the condition of the
economy."

The rapid decline in demand in September impacted certain of the
company's technical debt covenants. The company has obtained a
waiver of these covenants through February 2002. "We are in the
process of amending our debt facility through February 2003 to
provide the flexibility to achieve maximum operating results,"
said John Emery, president and chief operating officer. "Even
under current conditions, we are generating cash flow
substantially in excess of debt service, and as the recovery
continues we anticipate a return to historical financial
covenant ratios."

                         Outlook

"It is very difficult to provide meaningful guidance beyond 2001
until the aftereffects of the terrorist attacks become more
clear," Emery said. "We have cut our operating overhead at both
the corporate and property levels and believe we are properly
staffed with experienced managers to weather these unprecedented
economic conditions.

"Our core strength lies in our ability to operate successfully
under difficult economic conditions and to improve the operating
performance of our hotels," he said. "During tough periods,
hotels tend to change ownership more often, creating growth
opportunities for proven, experienced managers like MeriStar. We
are in a sound financial position and have the people and
systems in place to respond quickly and efficiently."

Emery said that the company anticipates a loss per share in the
2001 fourth quarter of $0.06 to $0.05 and full-year 2001 EBITDA
of $17 million to $18 million.

                 Key Financial Information

As of September 30, 2001:

     --  Total debt of $126 million
     --  Cash balance of $15.5 million
     --  Total debt to annual EBITDA of 5.8x
     --  Senior debt to annual EBITDA of 4.1x
     --  Annual interest coverage ratio of 2.1x
     --  Average cost of debt of 9.1 percent

MeriStar Hotels & Resorts operates 276 hospitality properties
with more than 57,000 rooms in 41 states, the District of
Columbia, and Canada, including 54 properties managed by
Flagstone Hospitality Management, a subsidiary of MeriStar
Hotels & Resorts. Through its Doral Golf division, MeriStar
manages 11 golf courses. BridgeStreet Corporate Housing
Worldwide, a MeriStar subsidiary, is one of the world's largest
corporate housing providers, offering upscale, fully furnished
corporate housing throughout the United States, Canada, the
United Kingdom, Paris, France and 35 additional countries
through its network partners.


METROMEDIA FIBER: Net Loss More Than Doubles in Third Quarter
-------------------------------------------------------------
Metromedia Fiber Network, Inc. (MFN) (Nasdaq: MFNX), the leading
provider of digital communications infrastructure solutions,
reported third quarter results for the period ended September
30, 2001.

Revenues for the quarter ended September 30, 2001 increased 76%
to $91.5 million, compared to $51.9 million reported for the
quarter ended September 30, 2000. Revenues were in the range of
the Company's revised guidance of $91.0 million to $93.0
million. For the nine months ended September 30, 2001, the
Company reported revenues of $260.2 million, which represented
an increase of 105% over revenues of $127.1 million for the nine
months ended September 30, 2000.

On October 2, 2001, the Company announced that it completed a
$611 million financing package. The Company also announced
several organizational and senior management changes. MFN's new
executive management team is comprised of Nick Tanzi, chief
executive officer, Mark Spagnolo, president and chief operating
officer, and Randall Lay, chief financial officer. Stephen
Garofalo, the founder of MFN, continues to serve as chairman of
the board.

In the third quarter, MFN also completed the integration of its
AboveNet and SiteSmith acquisitions and is now operating as a
single, unified company doing business under the MFN brand.
Through this process, the Company also reduced headcount as part
of a continuing effort to decrease expenses.

"Throughout the third quarter we focused and achieved our two
important goals - securing financing and streamlining
operations," said Nick Tanzi, chief executive officer of MFN.

"We have made significant strides in integrating MFN and its
subsidiaries, AboveNet and SiteSmith, into a single company,
thereby reducing our overall operating costs," said Mark
Spagnolo, president and chief operating officer of MFN. "We now
have a single sales, operations and infrastructure organization
to support and expand our customer base and take MFN to the next
stage of its development."  

The Company reported a net loss of $242.1 million for the third
quarter ended September 30, 2001, compared to a net loss of
$95.3 million, reported for the same period last year. For the
nine months ended September 30, 2001, the Company reported a net
loss of $595.7 million compared to a net loss of $272.5 million
for the same period in 2000. The increase in net loss was
primarily attributable to the acquisition of SiteSmith and the
related goodwill amortization and increased overhead and fixed
costs to support the Company's network expansion.

The Company's earnings before interest, other income and
expenses, taxes, depreciation, amortization and non-cash
deferred compensation expense (normalized EBITDA) improved to a
loss of $35.0 million for the third quarter of 2001, which was
in the range of the Company's revised guidance of a normalized
EBITDA loss of between $31 million and $35 million. The
normalized EBITDA loss for the third quarter of 2000 was $37.6
million. For the nine months ended September 30, 2001, the
Company reported a normalized EBITDA loss of $130.4 million
compared to a normalized EBITDA loss of $100.7 million for the
2000 nine month period.

For the third quarter of 2001, cost of sales was $63.4 million
compared to $50.7 million for the third quarter of 2000. For the
2001 nine month period, cost of sales was $205.5 million
compared to $133.5 million for the same period of 2000. The 2001
increase was primarily the result of costs associated with an
increased number of customers and higher fixed costs associated
with the operation of the Company's network.

Gross margins continued to improve increasing to 31% for the
third quarter of 2001 compared to 2% for the third quarter of
2000 and 16% for the second quarter of 2001. The improvement in
gross margins is the result of the reduction in headcount and
decreases in the Company's expenses for data circuits together
with increases in revenues.

Selling, general and administrative expense for the third
quarter of 2001 was $63.1 million, or 69.0% of revenues, as
compared to $38.7 million, or 75% of revenues, for the same
period last year. For the nine months ended September 30, 2001,
selling, general and administrative expense was $185.1 million,
or 71% of revenues, compared to $94.4 million, or 74% of
revenues, for the same period of 2000. While selling, general
and administrative expense increased primarily due to a year-
over-year increase in headcount and other overhead to support
the Company's network expansion, selling, general and
administrative expense decreased as a percentage of revenues
through recent cost reductions and more efficient operations.

Depreciation and amortization expense was $125.7 million for the
quarter ended September 30, 2001, compared to $46.0 million for
the quarter ended September 30, 2000. For the nine months ended
September 30, 2001, depreciation and amortization expense was
$288.9 million compared to $118.6 million for the same period in
2000. The 2001 increase was primarily the result of an increase
in amortization of goodwill relating to the acquisition of
SiteSmith and increased investment in the Company's fiber-optic
network and additional property and equipment acquired.

Some of the companies that signed contracts with MFN since June
30, 2001 include:

     -   Sony Pictures Digital Entertainment
     -   Microsoft Corporation's MSN Network
     -   GFINet, Inc.
     -   Homegain
     -   Lumenos
     -   InsideOut Technologies
     -   Topps

Below is additional information for the quarter.

     -   Internet infrastructure sales for the third quarter of
2001 were $56 million, or 61% of total revenues for the third
quarter of 2001. This represented an increase of 44% from
Internet infrastructure sales of $39 million for the third
quarter of 2000.

     -   Optical infrastructure sales were $36 million, or 39%
of total revenues for the third quarter of 2001. This
represented an increase of 177% from optical infrastructure
sales of $13 million for the third quarter of 2000. Carrier
revenues were $29 million, or 81% of optical infrastructure
sales, for the third quarter of 2001.

     -   MFN had approximately 2.1 million fiber miles deployed
at the end of the third quarter of 2001, consisting of
approximately 1.7 million intra-city fiber miles and 357,000
intercity fiber miles. This was an increase of 5% over last
quarter's reported 2.0 million fiber miles.

     -   As of September 30, 2001, MFN had fiber optic
infrastructure operational in 29 cities. This is unchanged from
last quarter as the Company prioritized its build out and
allocated its capital resources toward the cities that had the
greatest demand.

                   Management Outlook

Weakening economic conditions, which have been accelerated by
recent tragic events, have increased business uncertainty,
thereby making forecasting much more difficult for the Company.

     -   The Company reaffirmed its previous revenue and EBITDA
guidance for the fourth quarter of 2001. For the fourth quarter,
the Company previously provided revenue guidance of $100 million
to $103 million, which, when combined with the actual results
for the first three quarters of 2001, would represent an
increase of 91% to 93% in 2001 revenues compared to 2000
revenues. The normalized EBITDA guidance for the fourth quarter
of 2000 is a loss of $3 million to $9 million, which does not
include any one-time costs associated with the closing of the
Company's recent financing. As previously announced, due to
continued cost reductions and expense controls, the Company
expects to become EBITDA positive in early 2002.

     -   Capital expenditures were $388 million and $1.2 billion
for the third quarter and nine months of 2001, respectively. The
Company expects capital expenditures to be approximately $1.3
billion for 2001.

     -   Due to a lack of visibility into 2002 resulting from
extremely volatile economic conditions, the Company will not
provide 2002 guidance until early next year.

MFN is the leading provider of digital communications
infrastructure solutions. The Company combines the most
extensive metropolitan area fiber network with a global optical
IP network, state-of-the-art Internet Data Centers and award
winning managed services to deliver fully integrated, outsourced
communications solutions for Global 2000 companies. The all-
fiber infrastructure enables MFN customers to share vast amounts
of information internally and externally over private networks
and a global IP backbone, creating collaborative businesses that
communicate at the speed of light.

Customers can take advantage of MFN's complete, end-to-end
solution or select individual components to complement their
existing infrastructures. By leasing MFN's metropolitan and
regional fiber, customers can create their own, private optical
network with virtually unlimited, un-metered bandwidth at a
fixed fee. For more reliable, secure and high-performance
Internet connectivity, customers can use MFN's private IP
network to communicate globally without ever touching the
public-switched network. Moreover, MFN's comprehensive managed
services enable companies to create a world-class Internet
presence, optimize complex sites and private optical networks,
and transform legacy applications, all with a single point of
contact.  


MONARCH DENTAL: Continues Talks For EBITDA Covenant Waiver
----------------------------------------------------------
Monarch Dental Corporation (Nasdaq: MDDS) reported results for
the third quarter ended September 30, 2001.

Patient revenue, net was $51.7 million for the third quarter
compared to $52.0 million reported for the same period last
year.  Revenue per day for the third quarter was $821,000
compared to $825,000 for the same period last year.

The Company had net income for the quarter, excluding goodwill
amortization, of $736,000, compared to $1.2 million for the same
period last year. Including goodwill amortization, the Company
had a net loss for the quarter of $666,000 compared to a net
loss of $153,000 for the same period last year.

The Company attributed the decrease in revenue and net income in
the third quarter of 2001 to revenue declines in five specific
markets.  As reported in the second quarter, the Houston,
Philadelphia, Atlanta, New Jersey and Colorado markets have
experienced management changes and dentist turnover over the
past several months.  The combined revenue of these markets for
the third quarter decreased $2.0 million, or 15%, when compared
to the same quarter in 2000.  The combined EBITDA of the five
markets for the third quarter was $1.6 million, or 91%, less
than the same period last year.  Excluding these markets,
revenue for the Company increased $1.7 million, or 4%, and
EBITDA increased $301,000, or 7%, when compared to the third
quarter of 2000.  

The revenue decline in the five markets also contributed to a
minimum EBITDA financial covenant default under its credit
agreement with the Company's lenders. The Company has met all
other obligations, including all required principal and interest
payments, related to its credit agreement. The Company is
currently in negotiations with its lenders to obtain a waiver of
this financial covenant default.  The Company is optimistic that
a waiver of the default will be obtained.

For the nine-month period ended September 30, 2001, patient
revenue, net was $160.2 million, as compared to $161.2 million
in 2000.  Revenue per day for the nine-month period ended
September 30, 2001 remained constant with the same period in
2000 at $839,000.  Net income for the nine-month period ended
September 30, 2001, excluding goodwill amortization, was $4.0
million compared to net income, excluding goodwill amortization,
of $6.7 million for the nine-month period ended September 30,
2000.  Including goodwill amortization, the Company had a net
loss for the nine-month period ended September 30, 2001 of
$173,000, compared to net income of $2.5 million for the same
period last year.

Cash flow from operating activities for the quarter ended
September 30, 2001 was $3.7 million compared to $3.6 million for
the same period in 2000. For the nine-months ended September 30,
2001, cash flow from operating activities was $10.9 million
compared to $12.1 million for the same period in 2000.

W. Barger Tygart, Chairman and Chief Executive Officer, stated,
"While our financial results were negatively impacted by the
events of September 11th, the results were more significantly
impacted by the results of the five markets that experienced
management changes and doctor turnover during the last few
months.  We believe that the management and process changes that
we have implemented will begin to have a positive impact on the
financial results of the Company during the fourth quarter.  
Excluding these markets, the Company experienced solid revenue
growth and even stronger EBITDA growth."

Mr. Tygart continued, "We are most encouraged by the results of
our doctor recruitment efforts.  The number of doctors to whom
the Company is providing services has increased from 415 to 433
during the third quarter.  Our ability to grow revenue is
dependent on the Company's ability to increase the number of
dentists to whom it provides management and administrative
services.  The increase in the number of dentists during the
third quarter is an indication that our efforts are having
positive results.  The increase in the number of providers is
already starting to impact revenue in the fourth quarter.
Revenue per day in October 2001 increased approximately 2%-3%
over the same period last year."

Monarch Dental currently manages 184 dental offices serving 18
markets in 14 states.  The Company seeks to build geographically
dense networks of dental providers primarily by expanding within
its existing markets.


OWENS CORNING: Signs-Up Shumaker as Bankruptcy Co-Counsel
---------------------------------------------------------
On January 8, 2001, the Court entered an order authorizing the
employment and retention of Nathan, Roberts & Arnold, Ltd. as
Special Reorganization Counsel for Owens Corning effective the
petition date. On October 20, 2001, H. Buswell Roberts, Jr.,
Esq., the attorney at Nathan, Roberts & Arnold, Ltd. principally
responsible for the representation as special counsel to the
Debtors, left Nathan, Roberts & Arnold, Ltd. and is now a
partner of the Shumaker, Loop & Kendrick, LLP law firm.

The Debtors have determined that they require the continued
services of Mr. Roberts and Shumaker, Loop & Kendrick, LLP to
represent them regarding special bankruptcy related issues. As a
result of the Debtors' past professional relationship with Mr.
Roberts, the Debtors believe that Mr. Roberts and the Shumaker,
Loop & Kendrick, LLP firm are uniquely familiar with the
Debtors' business and affairs and are well qualified to
represent them. In addition, Shurnaker, Loop & Kendrick, LLP has
offices located in proximity to Owens Corning's World
Headquarters in Ohio.

By this Application, the Debtors seek to employ and retain the
firm of Shumaker, Loop & Kendrick, LLP effective as of August
20, 2001, as their local bankruptcy co-counsel and their local
real estate counsel.

Subject to further order of this Court and a division of
responsibilities among other counsel to the Debtors, the firm of
Shumaker, Loop & Kendrick, LLP will be required to render the
following services to the Debtors:

A. on site support regarding commercial matters, day-to-day
   contractual matters, real estate transactions and routine
   claim collection and recovery matters;

B. attend local meetings and negotiate with representatives of
   creditors and other parties in interest;

C. take all necessary action to protect and preserve the
   Debtors' estates, including, negotiations concerning
   commercial and contractual litigation in which the Debtors
   may be involved;

D. advise the Debtors locally in connection with ongoing
   business and commercial matters, many of which occur in the
   ordinary course of Debtors' business, including advising
   Debtors on, and bringing legal actions in connection with,
   collection of Debtors' accounts receivable, and prosecution
   of other legal and business claims by Debtors.

Norman L. Pernick, Esq., at Saul Ewing LLP, in Wilmington,
Delaware, tells the Court that the services of attorneys under a
general engagement are necessary to enable the Debtors to
execute faithfully their duties as debtors-in-possession.

Subject to Court approval, Mr. Roberts submits that compensation
will be payable to the firm on an hourly basis, plus
reimbursement of actual, necessary expenses incurred by the law
firm. The firm and the Debtors have also agreed that normal rate
structure will apply to these cases and to other post-petition
legal services performed for Owens Coming by the Shumaker, Loop
& Kendrick LLP firm. Presently, the firm's hourly rates are:

      Partners                   $175 to $320
      Counsel and Associates      145 to  175
      Legal Assistants                     80

Mr. Roberts explains that the hourly rates set forth above are
subject to periodic increases in the normal course of the firm's
business, often due to the increased experience of a particular
professional. The principal attorneys providing services to
Debtors with their hourly rates are:

      H. Buswell Roberts, Jr.     $220/hour
      David Coyle                  210/hour
      Joseph Rideout               250/hour
      Gregory Shumaker             250/hour
(Owens Corning Bankruptcy News, Issue No. 21; Bankruptcy
Creditors' Service, Inc., 609/392-0900)   


PAXSON COMMUNIATIONS: Gross Revenues Remain Flat in 3rd Quarter
---------------------------------------------------------------
Paxson Communications Corporation (AMEX:PAX), the owner and
operator of the nation's largest broadcast television station
group and the PAX TV network reaching 84% of U.S. households,
today reported its financial results for the three and nine
months ended September 30, 2001.

Financial Highlights:

     --  The Company had EBITDA of positive $2.5 million in the
third quarter of 2001, an improvement from EBITDA of negative
$10.4 million for the third quarter of 2000.

     --  Gross revenues for the third quarter remained
relatively flat with only a 1% decrease compared to the third
quarter of 2000, despite a challenging advertising market and
lost revenue of approximately $1 million due to the September
11th events.

     --  Cash operating expenses for broadcast operations and
SG&A decreased 16% compared to the third quarter of 2000.

     --  On September 17, 2001, the Federal Communications
Commission ("FCC") approved Paxson's plan for broadcasters to
clear the 700 MHz spectrum and on October 15, 2001, assigned
June 19, 2002 as the date for the 700 MHz spectrum auction.
Paxson is the largest station group owner in the 700 MHz band
with 19 stations.

Operating Highlights:

     --  PAX TV season-to-date primetime viewers are up 13% over
the same period last year.

     --  "The Ponderosa" is averaging over 1.6 million
households season-to-date; its season premiere was the highest
rated program ever for PAX TV.

     --  Season-to-date, "Doc" is registering ratings increases
of more than 100% over the year ago time period.

Gross revenues for the third quarter were $72.5 million, a
decrease of 1% compared with the quarter ended September 30,
2000. Gross revenues for the nine months ended September 30,
2001 were $231.7 million, an improvement of 1% over the prior
year period. The Company's relatively flat revenue for the three
and nine month periods primarily reflects the growing strength
of the PAX TV network despite softness in television station
broadcast revenues during such periods.

The Company's EBITDA improved $12.9 million to positive $2.5
million for the quarter ended September 30, 2001. The Company's
EBITDA improved to $11.0 million, a $23.0 million increase for
the nine months ended September 30, 2001. The Company's EBITDA
growth for the three and nine month periods resulted from cost
cutting measures in all areas of the Company's operations in
response to the ongoing recession in the advertising
marketplace. In furtherance of the Company's programming
strategy to increase viewership through the development of
quality original programming, the syndicated show "Touched By An
Angel" will be phased out of primetime into the daytime period.
The Company will replace "Touched By An Angel" with original
programming in primetime using its low cost production model. As
a result of this change in programming, the Company recorded a
charge of $67.0 million during the third quarter.

Led by its original programming, the PAX TV 2001-2002 broadcast
season is averaging nearly 1.4 million viewers in primetime, a
13% increase over the same time period a year ago. For both the
target demos of adults 25-54 and adults 18-49, season-to-date
ratings increased 10% over last year. PAX TV's new original
series "The Ponderosa" premiered on September 9, 2001 with a 2.4
HH rating, making its premiere the highest rated program ever on
PAX TV. Season to date, "The Ponderosa" is averaging 1.6 million
households and 2.3 million viewers and has more than doubled the
year ago time period delivery in all target demos. Returning for
a second season, "Doc" continues to post impressive ratings,
also averaging 1.6 million households and 2.3 million viewers.

Commenting on the outlook for the fourth quarter, Paxson Chief
Financial Officer Tom Severson said, "We currently expect our
revenues for the fourth quarter 2001 to be down in the high
single to low double digit range. Despite our expected revenue
decline in the fourth quarter, we are focused on growing EBITDA
through cost control efforts. We expect our fourth quarter
EBITDA to be in the positive $6 to $10 million range compared to
last year's fourth quarter EBITDA of $7.1 million. Our full year
EBITDA will be $17 to $21 million, an improvement of $22 to $26
million over last year despite an advertising market that is
seeing historically high decreases in ad spending."

700 MHz Spectrum:

On September 17, 2001 the FCC approved the Company's petition to
allow broadcasters to maintain their analog signal while also
clearing out of the 700 MHz band. This decision allows
broadcasters a means by which to clear the spectrum without
affecting their existing broadcast operations. On October 15,
2001, the FCC assigned June 19, 2002 as the date for the 700 MHz
spectrum auction. This auction involves the 700 MHz spectrum
currently used by U.S. television stations on UHF channels 59-69
and provides valuable spectrum to be used for next generation
wireless communication technologies. Paxson has 19 stations
assigned or operating on channels 59 to 69 and is the largest
group operator of stations utilizing the 700 MHz spectrum.
Investment bankers Allen & Company will be working with Paxson
and other broadcasters in the Spectrum Clearing Alliance to help
facilitate the 700 MHz auction process including the
compensation paid to broadcasters and time frames for clearing
the operation of UHF stations on channels 59 to 69.

Balance Sheet Analysis:

The Company's cash and short-term investments decreased during
the third quarter by $14.8 million to $60.0 million as of
September 30, 2001. The quarter's decrease in cash and short-
term investments primarily resulted from payments of interest
and dividends on financial instruments refinanced as part of the
Company's July refinancing transaction. The Company's total debt
increased from $414.4 million as of June 30, 2001 to $495.6
million as of September 30, 2001. The increase in total debt
resulted from expenses incurred in connection with the July
refinancing and debt incurred to redeem the Company's 12%
preferred stock.

Paxson Communications Corporation owns and operates the nation's
largest broadcast television station group and PAX TV, the
newest broadcast television network that launched in August of
1998. PAX TV reaches 84% of U.S. television households via
nationwide broadcast television, cable and satellite
distribution systems. Paxson owns and operates 65 stations
(including three stations operated under time brokerage
agreements). In September of 1999, Paxson entered into a
strategic alliance with NBC and through this relationship, PAX
and NBC have shared special runs of original drama series, NBC
movies and sports programs and the hit primetime quiz show,
"Weakest Link."

In addition, PAX airs its own original programming including
"It's A Miracle," "Mysterious Ways," "Encounters with the
Unexplained" and "Doc," starring recording artist Billy Ray
Cyrus. PAX TV's new season lineup includes the original series
"The Ponderosa," "Ed McMahon's Next Big Star" and "Candid
Camera." Additional Paxson properties include the PAX Family
Club, a branded affinity club that provides travel and product
discounts for families, parenting advice and valuable online
information. For more information, visit PAX TV's website at
http://www.pax.tv

At June 30, 2001, Paxson's liabilities exceeded assets by $323
million.  In July, the company completed a $500 million
refinancing transaction.  S&P continues to rate Paxson's 10-3/4%
Senior Subordinated Notes due 2008 at B-.  


PHAR-MOR: Wants More Time to Assume or Reject Unexpired Leases
--------------------------------------------------------------
To maximize the value of their Chapter 11 estates, Phar-Mor,
Inc. asks the US Bankruptcy Court of the Northern District of
Ohio to extend the time period to assume or reject unexpired
leases of real property at their non-core stores to January 22,
2002.

Although the Debtors have commenced the liquidation of their
assets at the non-core stores, the unexpired leases may be
valuable assets to the their estates. The Debtor says that they
will be unable to make reasonable decisions as to whether to
assume or reject all of the unexpired leases at the non-core
stores within the 60-day period which expires on November 23,
2001.

Furthermore, the Debtors do not want to forfeit their right to
assume any unexpired leases as deemed rejected by the Court, or
be compelled to assume certain of the Leases in order to avoid
rejections.

Phar-Mor, a retail drug store chain operating 139 stores, filed
for Chapter 11 Protection on September 24, 2001 in the US
Bankruptcy Court of the Northern District of Ohio. Michael
Gallo, Esq. at Nadler, Nadler and Burdman represents the Debtors
in their restructuring efforts.


PIONEER COMPANIES: Confirmation Hearing Adjourned Until Nov. 28
---------------------------------------------------------------
Pioneer Companies, Inc. (OTC Bulletin Board: PIONA) announced
that the hearing to confirm its Plan of Reorganization has been
adjourned until November 28, 2001 to complete the negotiations
for its exit financing.

Michael J. Ferris, President and Chief Executive Officer, said,
"All of the terms of the exit facility except one have been
agreed upon but that issue requires more time to resolve.  All
other prerequisites to confirmation, including the vote of the
necessary classes of creditors, have been accomplished.  We
appreciate the support shown by our Creditors' Committee and our
vendors and look forward to finalizing the credit agreement and
the confirmation of our Plan."

Pioneer, based in Houston, Texas, manufactures chlorine, caustic
soda, hydrochloric acid and related products used in a variety
of applications, including water treatment, plastics, pulp and
paper, detergents, agricultural chemicals, pharmaceuticals and
medical disinfectants.  The Company owns and operates five
chlor-alkali plants and several downstream manufacturing
facilities in North America.  Current financial information and
press releases of Pioneer Companies, Inc. can be obtained from
its Internet web site at  http://www.piona.com


PIXTECH INC: Restructuring Efforts Reduce Cash Burn Rate by 23%
---------------------------------------------------------------
PixTech, Inc. (Nasdaq:PIXT)(EASDAQ:PIXT) announced financial
results for the three-month period ended September 30, 2001.

PixTech reported revenues of $1.2 million for the third quarter
of 2001, approximately the same revenue recorded in the second
quarter of 2001. PixTech's loss from operations in the third
quarter of 2001 was $8.6 million, compared to $6.7 million in
the second quarter of 2001.

PixTech recorded a net loss of $8.5 million for the third
quarter of 2001, compared to $5.6 million in the second quarter
of 2001. The increased losses were mainly due to expenses
incurred in connection with the restructuring efforts. The net
loss, excluding restructuring costs of $3.4 million, would have
been $5.1 million.

During the quarter, PixTech streamlined the corporate structure,
distribution and production processes. As planned, the Company
closed the Boise, Idaho facility and transferred operations from
Boise, Idaho to Montpellier, France and Taiwan, ROC before the
end of September. The restructuring costs were approximately
$3.4 million, including $2.7 million of non-cash asset write-
offs. PixTech added three more U.S. manufacturers'  
representatives, increasing the distribution channel to
nine commission-based North American and four European
distributors.

In addition, PixTech concluded its DARPA agreement, started the
G2 product qualification process and completed the M2
qualification. G2 and M2 are PixTech's next generation
monochrome displays.

Ron Ritchie, PixTech's interim chief executive officer, said,
"During the quarter, we implemented our cost reduction program
and successfully transferred manufacturing and development
activities to the appropriate facilities; we consolidated all of
the 7-inch color development activity in Montpellier and
transferred the G1 back-end production to Taiwan. We believe we
have reduced our cash burn rate by 23%, and we anticipate saving
$1.5 million per quarter."

Ritchie continued, "Our goal remains to advance FED marketplace  
acceptance, build volume manufacturing and penetrate our target
markets. We have developed an aggressive color program, and we
anticipate releasing demonstration displays by mid-November 2001
and shipping the first commercial color units in the last half
of 2002. Our sales will be supported by our expanded
international distribution channel that reaches the appropriate
players in automotive, aerospace, medical, and industrial
equipment industries."

PixTech, Inc. is an advanced flat-panel display company
dedicated to commercializing its high-quality field emission
display (FED) technology. PixTech operates a flat-panel display
pilot manufacturing and a research and development facility in
Montpellier, France, and has offices in Santa Clara, California
and Rousset, France. To manufacture PixTech's FED products, the
company works with contract manufacturer, AU Optronics, formed  
by the merger of Acer Display Technologies Inc. and UNIPAC
Optoelectronics Corp. In addition to various design wins for the
5.2-inch monochrome display in both the medical and automotive
industries, PixTech recently announced the completion of the
first phase of the 7-inch Color Display FED and is now focused
on volume production and penetration of new markets for its
color displays. More information is available from the company's
web site at  http://www.pixtech.com

As at the end of September, the Company had a negative
stockholders' equity of $949,000. Also, total current
liabilities exceed total current assets by around $4 million.


POLAROID CORP: Engages Bingham Dana As International Counsel
------------------------------------------------------------
Polaroid Corporation desires to retain and employ Bingham Dana
LLP as international counsel to provide strategic advice and
assistance with respect to international contingency planning
matters.

Neal D. Goldman, EVP and Chief Administrative Officer of
Polaroid Corporation, explains that Bingham is particularly well
suited for the type of representation required by the Debtors
because it has both a national and international practice, and
has experience in all aspects of the law that may arise in these
chapter 11 cases.

The Debtors anticipate that Bingham will render international
bankruptcy and restructuring legal services to the Debtors as
needed, including:

  (i) advising the Debtors of the international aspects of their
      rights, powers and duties as debtors and debtors in
      possession continuing to operate and manage their
      businesses and properties under chapter 11 of the
      Bankruptcy Code while simultaneously continuing to operate
      in various foreign countries;

(ii) assisting the Debtors in the formulation and approval of
      bankruptcy protocols, agreements or concordats, where
      appropriate, between the United States Bankruptcy Court
      and various foreign courts in which insolvency proceedings
      involving the Debtors may commence;

(iii) advising and assisting the Debtors with respect to seeking
      recognition and relief in various foreign countries and
      foreign insolvency proceedings;

(iv) where needed, preparing on behalf of the Debtors all
      necessary and appropriate applications, motions, draft
      orders, other pleadings, notices, schedules and other
      documents, and reviewing all financial and other reports
      to be filed in these chapter 11 cases and in any related
      foreign countries or foreign proceedings;

  (v) advising the Debtors concerning, and preparing responses
      to, applications, motions, other pleadings, notices and
      other papers that may be filed and served in these chapter
      11 cases in connection with foreign proceedings initiated,
      including by the Debtors;

(vi) counseling the Debtors in connection with the formulation,
      negotiation and promulgation of a plan or plans of
      reorganization and any substantially similar schemes,
      compromises or plans which the Debtors may seek to propose
      in foreign insolvency proceedings; and

(vii) performing all other necessary or appropriate legal
      services in connection with these chapter 11 cases for or
      on behalf of the Debtors consistent with the limited role
      as international counsel.

Bingham will charge for its legal services on an hourly basis in
accordance with its ordinary and customary hourly rates.  Evan
D. Flaschen, a partner in the Bingham firm, identifies the
Bingham attorneys likely to render services in these cases and
their customary hourly rates:

    Attorney                  Designation         Hourly Rate
    --------                  -----------         -----------
    Evan D. Flaschen          Partner                $650
    William E. Kelly          Partner                 450
    Anthony J. Smits          Associate               390
    Anna M. Boelitz           Associate               275
    Leonhard Plank            Associate               215

Prior to the Petition Date, the Debtors paid Bingham a total of
$233,211.42 as retainer.  This has been applied on account of
legal fees and expenses incurred, and as of the Petition date,
$119,237.90 remained unapplied.  (Polaroid Bankruptcy News,
Issue No. 2; Bankruptcy Creditors' Service, Inc., 609/392-0900)


REBEL.COM: Telus Acquires Unix Outsourcing Division Assets
----------------------------------------------------------
TELUS Enterprise Solutions, the e.business division of TELUS,
has acquired the UNIX Outsourcing division of Rebel.com from
receiver KPMG and will assume Rebel.com's outsourcing services
contracts.

The acquisition of the Rebel.com division and its 30 highly-
skilled employees enables TELUS to offer the eastern Canadian
business market leading IT expertise in the UNIX outsourcing
area and a comprehensive suite of services that include UNIX
desktop services, satellite office support, project management,
firewall/mail/network support, and workstation effectiveness
management.

"This acquisition will expand TELUS' UNIX capabilities and give
us a significant presence in the eastern Canadian market," said
Garry Rasmussen, president of TELUS Enterprise Solutions. "It is
a reflection of TELUS' continued commitment to become a national
leader in IP, data and wireless services."

In addition, as a certified supplier of Government On-line (GOL)
services to the Federal Government, TELUS will leverage the
acquisition to bring innovative IT applications to the Federal
Government and the business community in Ottawa.

TELUS now has more than 300 employees based in Ottawa delivering
complete end-to-end IT solutions.

TELUS Corporation (TSE: T, T.A; NYSE: TU) is one of Canada's
leading telecommunications companies, providing a full range of
telecommunications products and services that connect Canadians
to the world. The company is the leading service provider in
Western Canada and provides data, Internet Protocol, voice and
wireless services to Central and Eastern Canada. For more
information about TELUS, visit http://www.telus.com

TELUS Enterprise Solutions is the e.business division of TELUS
Client Solutions. TELUS Enterprise Solutions is a leading and
comprehensive e.business services and Information Technology
(IT) outsourcing services provider.


ROYAL AVIATION: Leblanc Offers to Take-Over Assets and Debts
------------------------------------------------------------
Michel Leblanc, former President of Royal Aviation, presented
Canada 3000 with an offer to help ailing Royal Aviation avoid
declaring bankruptcy and preserve its several hundred jobs.

The decision to present this offer comes in the wake of Canada
3000's expressed intent to terminate Royal Aviation's operations
and lay off its 1,400 employees.

The offer, presented today to Canada 3000 management, outlines
the acquisition of the majority of the Royal Aviation assets at
fair market value, as well as the takeover of debts estimated at
approximately $24 million.

The proposal does not include the following assets: three leased
Boeing 757s, all equipment associated with these aircraft, and
the Royal Cargo and Royal Handling companies.

The offer is subject to a few major conditions, specifically
Canada 3000's cooperation in facilitating the transition for
Royal Aviation passengers, clients and employees; the receipt,
as was extended to other major air carriers, of a loan guarantee
in the amount of $30 million from the federal government; and
the renewal of all aircraft leases under acceptable conditions.

Lastly, the offer also calls for the return to the conditions
that prevailed as at March 20, 2001 before the two companies
merged, with regard to landing slots in Toronto, airport
facilities across Canada, and contracts between Royal Aviation
and Signature Vacances, Hola Sun and Conquest.


SMTC CORP: Bank Group Agrees to Waive Covenant Violations
---------------------------------------------------------
SMTC Corporation (Nasdaq: SMTX)(TSE: SMX), a global electronics
manufacturing services (EMS) provider to the technology
industry, reported its financial results for the third quarter
ended September 30, 2001.

Revenue for the third quarter of 2001 was $126.9 million, a
decline of 45.2 per cent from the $231.5 million recorded in the
third quarter of 2000. SMTC continued to be affected by the
broad-based decline in the technology markets in the third
quarter. Third quarter revenues included approximately $7.0
million of raw materials sales, reflecting the Company's
continued focus on reducing its inventory levels to align with
its reduced sales levels. These parts sales carried no margin.

Gross profits for the third quarter, before restructuring and
other charges, declined to a loss of $0.7 million from a profit
of $19.5 million in the same quarter last year. The operating
loss for the third quarter was $11.8 million, compared to an
operating profit of $8.5 million in the third quarter last year.

The adjusted loss for the quarter, excluding restructuring and
other charges and non-cash related acquisition charges was $7.5
million, or $0.26 per share against adjusted earnings of $4.4
million or $0.21 per share in the same period last year.

The Company has recorded charges in the third quarter related to
inventory and accounts receivable exposures, the cost of exiting
equipment leases and severance costs of $25.1 million, net of
tax. The Company expects to provide further restructuring and
other charges of up to $14 million, net of tax, in the fourth
quarter as the Company continues to adjust its cost structure to
prevailing market conditions.

The Company is responding proactively to the downturn in the
technology sector by remaining focused on the management of its
labor inputs, working capital, capacity utilization and
operating margins. Days sales outstanding and days of inventory
have declined to 65 days and 66 days, respectively, as at
September 30, 2001 from 86 days and 92 days, respectively, for
the same period last year. The Company has addressed its excess
capacity and declining operating margins by closing facilities
and continuing to drive down its cost base. The Company will
continue to focus on its competitive position by remaining
attuned to market conditions.

                    Bank Negotiations

The Company has received a proposed term sheet from its bank
group, under which the banks would:

     -  waive the Company's failure to comply with certain
        EBITDA-based covenants at the end of the third quarter,
        and

     -  revise the covenants that would apply for the next 12
        months to correspond to the Company's current business
        plan.

SMTC's management and board of directors were pleased to receive
the proposed term sheet and expect to reply promptly.

About the Company: SMTC Corporation is a global provider of
advanced electronic manufacturing services to the technology
industry. The Company's electronics manufacturing and technology
centers are located in Appleton-Wisconsin, Austin-Texas, Boston-
Massachusetts, Charlotte-North Carolina, San Jose-California,
Toronto-Canada, Cork and Donegal-Ireland and Chihuahua-Mexico.
SMTC offers technology companies and electronics OEMs a full
range of value-added services including product design,
procurement, prototyping, printed circuit assembly, advanced
cable and harness interconnect, high precision enclosures,
system integration and test, comprehensive supply chain
management, packaging, global distribution and after-sales
support. SMTC supports the needs of a growing, diversified OEM
customer base primarily within the networking, communications
and computing markets. SMTC is a public company incorporated in
Delaware with its shares traded on the Nasdaq National Market
System under the symbol SMTX and on The Toronto Stock Exchange
under the symbol SMX. Visit SMTC's web site  http://www.smtc.com
for more information about the Company.


SAFETY-KLEEN: Court Okays Agreement to Indemnify EVP/CAO Arnst
--------------------------------------------------------------
Judge Walsh approves Safety-Kleen Corp.'s agreement with Mr.
Arnst, and orders that he will have no liability in his capacity
as Executive Vice President and Chief Administrative Officer or
in any other capacity contemplated by the Arnst agreements to
any of the Debtors, the Debtors' affiliates, and/or any of their
respective creditors, shareholders, employees, officers and/or
bankruptcy estates, or to any superseding trustee appointed with
respect to such estates (whether under Chapter 11 or Chapter 7)
and/or to any other person or entity for any claim, loss, cost
or other damage of any nature, except only to the extent that
such liability, claim, loss, cost or other damage is finally
adjudged by a court of competent jurisdiction, after exhaustion
of all appeals, to have been caused by Mr. Arnst's gross
negligence or willful misconduct (and any actions, omissions, or
other matters taken with court approval will conclusively be
deemed not to constitute negligence, gross negligence or willful
misconduct. (Safety-Kleen Bankruptcy News, Issue No. 22;
Bankruptcy Creditors' Service, Inc., 609/392-0900)    


SPACEHAB INC: Firms-Up Debt Workout Terms with Two Creditors
------------------------------------------------------------
SPACEHAB, Inc. (Nasdaq: SPAB), a leading provider of commercial
space services, announced financial results for the first
quarter of fiscal 2002, ended September 30, 2001.

SPACEHAB reported a net loss of $2.9 million for the quarter, a
49 percent reduction from the net loss of $5.6 million reported
for the previous quarter.

SPACEHAB recorded revenues of $22.3 million for first quarter
2002 versus $29.9 million for fourth quarter 2001 and $27.0
million for first quarter 2001.  Gross profit was equal to $2.4
million for first quarter 2002 versus $2.8 million for fourth
quarter 2001 and $4.4 million for first quarter 2001.

While revenue declined between fourth quarter 2001 and first
quarter 2002, gross profit improved from 9.5 percent of revenue
to 10.9 percent of revenue in the first quarter due to cost
reduction efforts begun in fiscal 2001.  The decline in revenue
is primarily attributable to changes in the mix of business
within SPACEHAB's Space Flight Services and Johnson Engineering
business segments.  First quarter 2002 operating expenses
declined 18 percent from first quarter 2001, a direct result of
company-wide cost reduction efforts. Operating expenses
increased 16 percent, from $4.3 million in fourth quarter 2001
to $5.0 million in first quarter 2002, a result of investment in
new business development.  Noncash charges totaled $3.4 million
for first quarter 2002.

First quarter 2002 earnings before interest, taxes, depreciation
and amortization (EBITDA) were $1.9 million, compared to $2.4
million for fourth quarter 2001 and $0.5 million for first
quarter 2001.  For first quarter 2002, SPACEHAB recorded a small
provision for income taxes and no tax benefit for utilization of
current period tax losses in future periods.  In first quarter
2001, SPACEHAB recorded a $780,000 tax benefit equal to $0.07
per share.

"Our first quarter 2002 results reflect continued progress
toward improving liquidity and returning to profitability," said
SPACEHAB Senior Vice President, Finance and Chief Financial
Officer Julia Pulzone.  "We have executed the remaining elements
of our financial plan disclosed with our year end financial
results, and we are managing our business to exceed our baseline
financial plan established in June 2001 for fiscal year 2002.  
While continuing to meet commitments to our customers and
vendors, SPACEHAB made more than $5.1 million of principal
repayments on debt in the first quarter, and we continue to see
improvement in working capital over the previous quarter."

On October 29, 2001, SPACEHAB finalized terms for restructuring
of debt with Alenia Spazio S.p.A., lowering the interest rate
and extending the term for repayment through 2003.  The terms of
the restructuring require payments of $4.2 million in the
current fiscal year.  The remaining balance of $3.7 million will
be repaid in future periods.

SPACEHAB reached agreement with Bank of America on October 24,
2001, to restructure the terms and conditions of SPACEHAB's
credit facility, including structuring new covenants for the
facility.

On August 30, 2001, Astrotech entered into agreements for a $20
million financing of its Florida facility expansion.  The
financing was completed on September 10.  This facility
represents a $30 million investment on the part of Astrotech.  
Construction was completed on the facility, and it was dedicated
on October 25, 2001.

In November 2001, SPACEHAB concluded negotiations with NASA on
equitable- adjustment payments for STS-107 from October 1, 2001,
to the June 2002 current estimated launch date.  SPACEHAB also
is negotiating pricing with NASA for two new International Space
Station resupply missions currently scheduled to launch in 2003;
these negotiations are expected to conclude this month.

On September 27, 2001, SPACEHAB's majority-owned subsidiary
Space Media, Inc., obtained a $750,000 equity investment.  Space
Media completed preparations for a new school year with its
STARS Academy global education program during first quarter
2001.  Subsequent to the first quarter, The Space Store, Space
Media's online retail operation, established a partnership with
the multimedia company SPACE.com -- http://www.space.com-- to  
create a new distribution channel that will drive revenue by
increasing traffic between their respective Web sites.  
SPACE.com -- http://www.space.com-- reports that its Web site  
receives 20 million page views per month.

Founded in 1984, with more than $100 million in annual revenue,
SPACEHAB, Inc., is a leading provider of commercial space
services. The company develops, owns, and operates habitat and
laboratory modules and cargo carriers aboard NASA's Space
Shuttles.  It also supports astronaut training and space station
configuration management at NASA's Johnson Space Center in
Houston and builds space-flight trainers and mockups.  
SPACEHAB's Astrotech subsidiary provides commercial satellite
processing services at facilities in California and Florida.  
SPACEHAB's newest strategic growth initiative, SPACEHAB
Huntsville, offers customer-focused end-to-end services to the
space research community at NASA's Marshall Space Flight Center
in Huntsville, Alabama. SPACEHAB subsidiary Space Media, Inc.?,
brings space into homes and classrooms worldwide with
interactive education programs through STARS Academy --  
http://www.starsacademy.com --  and space merchandise from The  
Space Store --  http://www.thespacestore.com


SUN HEALTHCARE: Court Approves Settlement with Worldcom Inc.
------------------------------------------------------------
Sun Healthcare Group, Inc. sought and obtained the Court's
authority, pursuant to Rule 9019 of the Bankruptcy Rules, to
compromise and settle claims between the Debtors and Worldcom,
Inc., arising from billing and pricing under a telecommunication
services contract that has been rejected.

On September 10, 1996, prior to the Commencement Date, Regency
Health  Services, one of the Debtors, entered into a contract
with Worldcom for the  provision of telecommunication services.
Under the terms of the Contract,  Regency agreed to use Worldcom
as its exclusive telecommunications carrier  for at least 95% of
its aggregate voice and data services for a period of 3  years.
In exchange, Worldcom agreed to provide the use of several  
long-distance telephone circuits to Regency at a then-reduced
rate (approximately $0.22 per minute of long distance telephone
use) for the  duration of the Contract, with the Debtors' option
to extend the agreement  for an additional three years.

The Contract was automatically renewed  pursuant to its own
terms for an additional three year period on September  15,
1999. It was subsequently rejected as of May 15, 2001 in
accordance  with a Rejection Order by the Court.

                    The Disputed Amounts

(A) The Debtors' Claims

   (1) The Amtrak Billing Claim

       The Debtors assert that they were billed approximately
       $289,000 by Worldcom for the period October 1998, through
       March 2000, for the use of a telephone circuit that was
       operated by a third party and not the Debtors (the Amtrak
       Circuit). Worldcom has credited the Debtors' account in
       the amount of $150,529.84 for the period July 1999,
       through March 2000. The Debtors assert that they have not
       received credit for the remaining $138,000 billed by
       Worldcom for the Amtrak Circuit prior to July 1999.

       Worldcom asserts that this claim was resolved pursuant to
       a Stipulation and Order by and Among MCI
       Telecommunications Corporation and the Debtors Concerning
       Adequate Assurance of Payment for Post-Petition
       Telecommunications Services Pursuant to 11 U.S.C. section
       366(a), dated January 11, 2000.

   (2) The Credits Claim

       On January 6, 2000, the Debtors orally requested that
       Worldcom disconnect service on ninety-six (96) circuits.
       Pursuant to governing tariffs, Worldcorn has thirty days
       within which to disconnect service.

       The Debtors assert that a representative of Worldcom
       represented to Sun that such circuits would be
       disconnected but Worldcom did not begin to disconnect the
       circuits until March 23, 2000, well beyond the thirty-day
       disconnect period provided in the governing tariff.
       Moreover, the Debtors continued to receive invoices for
       certain of these circuits through September 2000.
       Worldcom has credited the Debtors for those circuits
       invoiced after April 3, 2000. The Debtors assert that
       they should be credited an additional $158,033.55,
       representing the amount they were billed following the
       expiration of the thirty-day period through April 3,
       2000.

       Worldcom asserts that the thirty-day disconnect period
       did not begin to run on January 6, 2000 but on February
       2, 2000 (the date on which the Debtors gave Worldcom a
       written disconnect notice) because the governing tariff
       requires that disconnect requests be made in writing.
       Worldcom also asserts that the Debtors agreed to give
       Worldcom an additional 30 days to disconnect the circuits
       beyond the thirty days provided for in the tariff.
       Therefore, Worldcom contends that the Debtors are not
       entitled to the credit for the period through April 3,
       2000.

(B) Worldcom's Claims

   (1) The Tariff Claim

       Worldcom asserts that the rejection of the Contract
       relieves it from the favorable pricing terms afforded to
       the Debtors under the Contract, retroactive to the
       Commencement Date, through May 15, 2001. Worldcom
       believes that the rate set forth in the Worldcom Tariff
       FCC No. I, rather than the favorable Contract rate, is
       the appropriate billing rate for the entire period
       service was provided to the Debtors.

       The Debtors assert that the Contract rate is the
       appropriate rate.

   (2) The Exclusivity Claim

       Worldcom also asserts that it is entitled to assert a
       claim against the Debtors as a result of the Debtors'
       violation of exclusivity provisions within the Contract.

       The Debtors object to this Claim.

   (3) The Underutilization Claim

       Further, Worldcom asserts that it is owed an amount for
       damages stemming from the Debtors' rejection of the
       Contract, comprised of, inter alia, monthly under-
       utilization charges for the duration of the Contract,
       which was set to expire on October 14, 2002.

       The Debtors dispute these assertions.

                   The Settlement Agreement

After extensive negotiations over approximately the last 3
months, the Debtors and Worldcom have come to a compromise and  
entered into the Settlement Agreement which resolves all issues
between the parties over the matter:

       (1) Worldcom shall issue to the Debtors a credit in the
amount of $100,000.00 in satisfaction of the Amtrak Billing
Claim and the Credits Claim.

       (2) In consideration of the Credit and the mutual release
by Worldcom, the Debtors shall release Worldcom from any and all
claims arising from Worldcom's provision of services to the
Debtors, including, but not limited to, the Amtrak Billing Claim
and the Credits Claim.

       (3) The Debtors shall owe Worldcom the sum of $448,417.26
as payment for issued and outstanding invoices for postpetition
telecommunications services provided by Worldcom. The sum of
$100,000.00, equal to the amount of the Credit, and the sum of
$265,519.19, equal to the amount of a security deposit held by
Worldcom plus interest, shall be applied by Worldcom as partial
payment of the $448,417.26, and the Debtors shall pay the
remaining amount, $82,898.07, in United States currency.

       (4) In consideration of the payment above, Worldcom shall
release the Debtors from/ any claims arising from Worldcom's
provision of services to the Debtors, including, but not limited
to, the Exclusivity Claim, the Underutilization Claim, and the
Tariff Claim.

The Debtors submit that the Settlement Agreement is fair and
equitable and falls well within the range of reasonableness as
it resolves the disputed claims litigation of which would be
complex and expensive. The Debtors also anticipate savings
relating to a potential substantial damage claim arising from
the Debtors' rejection of the Contract, as well as a potential
administrative expense claim.

The Debtors believe in their reasoned, good faith business
judgment, that the Settlement Agreement, viewed as a whole, is
in the best interest of their estates and creditors. (Sun
Healthcare Bankruptcy News, Issue No. 25; Bankruptcy Creditors'
Service, Inc., 609/392-0900)   


SUN HEALTHCARE: Changes Management to Begin Emergence Process
-------------------------------------------------------------
Sun Healthcare Group, Inc. (OTC: SHGE) announced several changes
in the Company's board of directors and management, as part of
the Company's plan to begin the process of emergence from
bankruptcy.

As is customary in many bankruptcy proceedings, Sun's president
and chief executive officer, Mark G. Wimer, submitted his
resignation to provide for an orderly management transition in
connection with a plan of reorganization recently negotiated
with the Company's principle creditor constituencies. Members of
the Company's board of directors filled several vacancies on the
board with independent directors and then submitted their
resignations as well.

New director candidates were proposed by representatives of
creditors who will be the majority shareholders of the Company
when it emerges from chapter 11.  The newly constituted board
appointed Richard K. Matros as the Company's chief executive
officer and chairman of the board.

The Company's reorganization plan, which is expected to be filed
with the U.S. Bankruptcy Court in the near future, would
extinguish the Company's outstanding common stock.  New common
stock will be issued to certain Company creditors, effectively
making those creditors the new owners of the Company.

Mark G. Wimer became chief executive officer of Sun Healthcare
Group in July 2000, after serving as the company's president and
chief operating officer.  He first joined Sun in 1993 and had
previously been senior vice president for inpatient services
and, before that, president of the company's skilled nursing
facility subsidiary, responsible for managing all of the
companies skilled nursing and assisted living facilities.

Richard K. Matros has held several chief executive positions in
the health care and health services industries, including
serving as chief executive of the former Regency Health Services
from 1994 to 1997, which was acquired by Sun Healthcare Group in
1997.  He presently serves as a director of several privately
held health care concerns, including CareMeridian and Geriatrix,
a community based provider of services to patients with head
trauma injuries and a senior health care organization
specializing in senior risk plans respectively.

The company's new directors are Gregory S. Anderson, Bruce C.
Vladek, Steven L. Volla, Milton J. Walters, and Richard K.
Matros.

Speaking for the resigning members of the Company's board of
directors, former chairman James R. Tolbert III, said: "Mark
Wimer's leadership during this extraordinarily challenging
transition period was absolutely critical to our ability to
reach an agreement on a plan of reorganization with our
creditors.  Under Mark's leadership, Sun disposed of under-
performing assets and significantly improved both the financial
and quality of care performance of the Company's nursing home
operations.  Most importantly, Mark Wimer was instrumental in
settling several legal actions that had been brought by state
and federal authorities, thereby eliminating many of the
uncertainties and liabilities that contributed to the Company's
delayed emergence from Chapter 11."

Headquartered in Albuquerque, N.M., Sun Healthcare Group, Inc.,
is a diversified long-term care provider.


SUN HEALTHCARE: Files Joint Plan of Reorganization in Delaware
--------------------------------------------------------------
Sun Healthcare Group, Inc. (OTC: SHGE) announced that it has
filed a plan of reorganization with the United States Bankruptcy
Court for the District of Delaware.  The plan has the support of
Sun's most significant creditor constituencies.

As filed, the plan provides for the issuance of new common
stock, of which approximately 90 percent would be issued to
Sun's senior lenders and approximately 10 percent to Sun's
general unsecured creditors.  Holders of Sun's senior
subordinated debt would receive warrants to purchase
approximately 5 percent of the new common stock.  Existing
holders of Sun's common stock, convertible subordinated debt,
and convertible trust-issued preferred securities would receive
no distribution under the plan.  

The plan is subject to approval by certain creditor classes and
the Bankruptcy Court. A disclosure statement and voting
instructions will be mailed following Bankruptcy Court approval
of the disclosure materials.

Sun and its subsidiaries voluntarily filed for chapter 11
protection on October 14, 1999, citing drastic cuts in Medicare
reimbursement and continued underpayment by most state-funded
Medicaid systems.

Wallace E. Boston Jr., Sun's chief financial officer, said, "Our
primary goals when we filed for chapter 11 were to restructure
our debt and to protect our ability to continue to provide care
to our patients and residents. Employees of Sun and its
subsidiaries have worked tirelessly to accomplish these goals
during the reorganization."

Copies of the filed plan, disclosure statement and a summary of
those documents will be posted in the reorganization section of
Sun's web site at http://www.sunh.com

Headquartered in Albuquerque, N.M., Sun Healthcare Group is a
leading long-term care provider in the United States, operating
more than 250 long-term and postacute facilities in 26 states
through its SunBridge subsidiary.  In addition, other Sun
Healthcare Group subsidiaries provide high-quality therapy,
pharmacy and other ancillary services for the healthcare
industry.


TELEX COMMS: Exchange Offer & Solicitation Expires On Nov. 20
-------------------------------------------------------------
Telex Communications, Inc. announced that it has further
extended the expiration date for its previously announced
Exchange Offer and Consent Solicitation in connection with its
proposed debt restructuring plan. The Exchange Offer and Consent
Solicitation relate to the Telex 10-1/2% Senior Subordinated
Notes Due 2007 (CUSIP No. 879569AD3) and Telex (formerly known
as "EV International, Inc.") 11% Senior Subordinated Notes Due
2007 (CUSIP No. 269263AC3).

The Exchange Offer and Consent Solicitation have been extended
to, and are now scheduled to expire at, 5:00 P.M., New York City
time on Tuesday, November 20, 2001. The Exchange Offer and
Consent Solicitation are being made pursuant to the Amended and
Supplemented Consent Solicitation Statement and Exchange
Offering Memorandum dated October 24, 2001 and the related
Consent and Letter of Transmittal which more fully set forth the
terms of the Exchange Offer and Consent Solicitation. Holders of
Senior Subordinated Notes may obtain further information by
calling Telex's Information Agent, Jefferies & Company, Inc.,
Attention: Adam Fakhri or Robert Basic, at (310) 575-5200, or by
facsimile at (310) 575-5165.

In order to effect the restructuring plan, including the
Exchange Offer, Telex is soliciting consents to authorize the
transfer of Telex's assets and liabilities to a new operating
company (if elected by Telex), to amend the indentures governing
the Senior Subordinated Notes to eliminate various restrictive
covenants and the restructuring transactions, and to waive
defaults under the indentures and the Senior Subordinated Notes,
as described in the Amended and Supplemented Consent
Solicitation Statement and Exchange Offering Memorandum.

Holders of the Senior Subordinated Notes are being offered the
opportunity to exchange all of the outstanding Senior
Subordinated Notes for securities to be issued by Telex or, if
the Telex assets are transferred to a new operating company, by
such new operating company.

Holders will have the option to exchange their Senior
Subordinated Notes for: (i) units consisting of an allocable
portion of 13% Senior Subordinated Discount Notes Due 2006 of
the issuer having an aggregate deemed issue price of $56.25
million, and an allocable portion of shares of the capital stock
of the issuer (at least approximately 99% of Telex if Telex is
the issuer, or 100% of any new operating company formed if the
Telex assets are transferred to the new operating company); or
(ii) units consisting of an allocable portion of Warrants to
purchase shares of the capital stock of the issuer which will
represent up to an aggregate of 25% of the capital stock of the
issuer subject to the satisfaction of specified EBITDA
requirements.

Telex's restructuring plan is intended to significantly reduce
Telex's outstanding debt, increase its financial flexibility and
improve its cash flow.

The Exchange Offer and Consent Solicitation are conditioned
upon, among other things, the consent of the lenders under
Telex's senior secured credit facility and senior secured notes
to the restructuring transactions, and waivers of defaults under
the senior secured credit facility and senior secured notes, and
obtaining additional senior secured financing. Telex is awaiting
approval by such lenders of proposed amendments to the senior
secured credit facility and the senior secured notes which,
among other things, would provide for the consent of such
lenders to the restructuring transactions, waivers of such
defaults and the issuance of $10 million of additional senior
secured notes.

As of this date, tenders of approximately $124,500,000 principal
amount (or 99.6%) of the 10-1/2% Senior Subordinated Notes, and
tenders of approximately $99,950,000 principal amount (or
99.95%) of the 11% Senior Subordinated Notes, have been received
pursuant to the Exchange Offer.

Telex is a leader in the design, manufacture and marketing of
sophisticated audio, wireless and multimedia communications
equipment for commercial, professional and industrial customers.
Telex provides high value-added communications products designed
to meet the specific needs of customers in commercial,
professional and industrial markets, and, to a lesser extent, in
the retail consumer electronics market.


VLASIC FOODS: Committee Names Initial Members of VFI LLC Board
--------------------------------------------------------------
The Official Committee of Unsecured Creditors of Vlasic Foods
International, Inc. notifies the Court of the identity of the
initial members of the board of directors of the Delaware
limited liability company, VFI LLC:

    (1) Mr. Noah Postyn
        TimesSquare Capital Management, Inc.
        Four Times Square, 25th Floor
        New York, New York 10036

    (2) Mr. Nicholas Walsh
        Gramercy Capital Advisors
        3 Sheridan Square, Suite 11E
        New York, New York 10014

    (3) Mr. Abe Siemens
        47 Princeton Drive
        Rancho Mirage, California 92270
(Vlasic Foods Bankruptcy News, Issue No. 14; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


WARNACO GROUP: Court Okays Bear Stearns As Financial Advisors
-------------------------------------------------------------
After due deliberation, Judge Bohanon approved The Warnaco
Group, Inc.'s application to retain and employ Bear Stearns &
Co., Inc. as financial advisors, nunc pro tunc to September 13,
2001.

Judge Bohanon decreed that the formulas used to calculate the
monthly fee and transaction fee as provided in the Letter
Agreement shall not be subject to challenge except under the
standard of review set by the Bankruptcy Code.  Nevertheless,
Judge Bohanon acknowledges the rights of the United States
Trustee to object to Bear Stearns' interim and final fee
applications on all grounds.

The Court order also provides that all requests of Bear Stearns
for payment of indemnity shall be made by means of an
application and shall be subject to review by the Court.  Judge
Bohanon makes it clear, however, that in no event shall Bear
Stearns be indemnified in the case of bad-faith, self-dealing,
breach of fiduciary duty (if any), gross negligence or willful
misconduct. (Warnaco Bankruptcy News, Issue No. 12; Bankruptcy
Creditors' Service, Inc., 609/392-0900)  


WESTPOINT STEVENS: DebtTraders Analyst Sees No Improvements
-----------------------------------------------------------
WestPoint Stevens announced its third quarter results on
Tuesday, October 23rd. Net sales for the third quarter increased
five percent from the same period last year to $513.1 million.
Operating earnings before non-recurring charges, however,
decreased $20.7 million to $55.7 million for the third quarter.

The Company blamed the lower operating earnings on increased raw
material and energy costs as well as on the continued
promotional sales activity. EBITDA for the third quarter was
$77.3 million, which was significantly lower than the $96.3
million EBITDA for the third quarter of last year. Net income
for the third quarter, excluding non-recurring charges, was $5.4
million, versus $27.8 million for the third quarter of last
year.

"We do not expect significant operating improvement in the
immediate future," Michael B. Kanner, at DebtTraders (1-212-247-
5300) says.  "For the fourth quarter, management stated that it
is expecting sales to be at the lower end of prior guidance,
which would be approximately $480 million. This would be an
increase of fifteen percent versus the same quarter of the prior
year. It is also expecting fourth quarter EBITDA of $60 to $65
million. Earnings per share for the fourth quarter, before non-
recurring charges, are projected to be $0.02 to $0.05. For
fiscal year 2002, the CEO stated that he is comfortable with a
57 cents EPS estimate. This roughly translates into a full year
EBITDA figure of approximately $270 million.

"Company management effectively is projecting that EBITDA will
approximate $215 million for the full year ended December 2001.
This is the second time that projections for the year were
lowered. When the Company pre-announced second quarter results
in July, it stated that full year EBITDA should be $225 million,
as opposed to the $295 to $315 million that had been projected
in April."

As of September 30, balance sheet debt totaled $1.71 billion. In
addition, there is $160 million of a receivables securitization
outstanding and off balance sheet.

"We do not have a formal investment opinion on the securities at
this time," Mr. Kanner continues.  "However, although the
liquidity situation has improved, we no longer believe the
outlook for the Company is positive. We believe that the Company
needs to demonstrate its ability to execute its plan over the
next few quarters."

Westpoint Stevens Inc.'s 7.875% Bonds Due '08 are trading in the
low 30's this week.  For real time pricing information, see
http://www.debttraders.com/price.cfm?dt_sec_ticker=WSTVN2


WINSTAR COMMS: CIT Lending Demands $268K Monthly Lease Payments
---------------------------------------------------------------
CIT Lending Services Corporation asks the Court to compel
Winstar Communications, Inc. to make lease payments to CIT and
to make a decision whether to assume or reject a certain lease
within 10 days.

Jan A.T. van Amerongen, Esq., at Reed Smith LLP, in Wilmington,
Delaware, relates that prior to the Petition Date, CIT Lending
leased certain telecommunications equipment to the Debtors.
Under the Lease Agreement, the Debtors are required to make
monthly payments of $268,136.18. However, Mr. Amerongen says,
the Debtors have failed to make any payment since July 2001.

On these grounds, CIT Lending requests the Court to compel the
Debtors to bring current its delinquent lease payments and make
ongoing lease payments on a timely basis. Mr. Amerongen points
out that the Bankruptcy Code requires a debtor to timely perform
all obligations under an unexpired lease of personal property
until such lease is assumed or rejected.

CIT Lending also requests that the Court compel the Debtors to
file a motion to assume or reject the Lease and, subsequently,
that the Court schedule a prompt hearing on such motion.

                       Debtors Object

Pauline K. Morgan tells the Court that CIT Lending's motion
seeks to compel payment of sums that the Debtors have already
paid. She asserts that the Debtors have paid all sums due under
the Lease Agreement for the periods of July, August, September,
and October 2001.

Additionally, since their representations of non-payment are
nonexistent, Ms. Morgan argues that CIT Lending has no basis to
request for the entry of an order establishing a deadline for
the Debtors to assume or reject the Lease. Moreover, she says
that the entry of such an order would improperly constrain the
Debtors' reorganization and may interfere with their efforts to
sell the business.

Ms. Morgan cites that a prospective purchaser of the Debtor's
business might be deterred by the large potential administrative
claims that would result if the Lease Agreement were assumed and
such purchaser would determine that the Lease was not a required
component of the business.  Accordingly, at this stage in these
cases, Ms. Morgan maintains that it is premature to establish a
deadline for assumption or rejection of a contract such as the
Lease Agreement.

Ms. Morgan says that the Debtors are presently working with CIT
Lending to track payments for August and September 2001. She
explains that CIT's difficulty in tracing these payments may be
attributable to the fact that CIT never notified the Debtors
that it had taken assignment of the Lease. Ms. Morgan relates
that without this knowledge of the assignment, the Debtors have
continued to make payments to AT&T.  Thus, she concludes, the
delay that CIT may have experienced in receipt of such payments
is attributable only to themselves. (Winstar Bankruptcy News,
Issue No. 17; Bankruptcy Creditors' Service, Inc., 609/392-0900)   


BOOK REVIEW: TRANSCONTINENTAL RAILWAY STRATEGY:
             A Study of Businessmen
-----------------------------------------------
Author:  Julius Grodinsky
Publisher:  Beard Books
Softcover: 439 pages
List Price: $34.95
Order your personal copy -- and one for a friend -- at
http://amazon.com/exec/obidos/ASIN/1587980037/internetbankrupt

Railroads were pioneers of the American frontier.  Union
Pacific; Central Pacific; Kansas and Pacific; Chicago, Rock
Island and Pacific; Chicago, Burlington and Quincy; Atchison,
Topeka and Santa Fe:  these names evoke boom times in America,
the excitement and tumult of seemingly limitless growth and
opportunity, frontiers to tame, fortunes to be made.  Railroads
opened up vast supplies of raw materials, agricultural products,
metals, and lumber. The public gain was incalculable:  job
creation, low-cost transportation, acceleration of westward
immigration, and settlement of the frontier.  

The building of the western railway system in the United States
was described at the time as "one of the greatest industrial
feats in the world's history."  This book tells the story of the
trailblazers of the Western railway industry, men with a
stalwart willingness to take on extraordinary personal financial
risk. As a group, these initial railroad promoters were smart,
bold, tenacious, innovative, and fiercely competitive.  Some
were cautious with their and their investors' money, some
reckless.  Most met with financial setbacks, some with total
failure, some time and time again.   They often sold out at
great losses, leaving their successors to derive the benefits
later.  

Bitter competition existed among these men. They fought to
position their "roads" in a limited number of mountain passes,
rivers, and valleys; and to chart routes which connected major
production areas with major consumption areas. They cajoled and
begged almost anyone for capital. They created and tried to
defend monopolies.  They bullied each other, invaded each
other's territories, and retaliated against each other.  They
staged wage wars.  They agreed not to compete with each other,
and bought each other out.

The book opens in May of 1869, just after the completion of the
first transcontinental route joining the Union Pacific Railroad
and the Central Pacific Railroad in Ogden, Utah. The companies'
long-term prospects were excellent, but right then they were
desperate for cash.  Union Pacific alone was more than $15
million in debt.  Additional financing was proving scarce.  By
1870, more than 40 railroads were floating bonds, "at almost any
price for ready cash," wrote one contemporary observer.  Still,
funds were raised and construction went on, both of
transcontinental lines and branch lines.  

As railway lines in the West were built in relatively unsettled
areas, traffic was light and returns correspondingly low.  To
increase business, the companies found ways to encourage
population growth along their routes.  Much-needed funding came
from immigration services set up by the railways themselves.  
Agricultural areas sprang up along the routes.  Sometimes volume
of traffic expanded too fast, and equipment shortages and
construction delays occurred.  Or, drought, recession, and low
agricultural prices meant more red ink.

This book takes the reader through the boom times and bust times
of the greatest growth of railways the world has ever seen. The
author uses a myriad of sources showing  painstaking and
creative research, including contemporary news accounts; railway
company financial records and archives; contemporary industry
journals; Congressional records; and personal papers, letters,
memoirs and biographies of the main players.  It's a good, solid
read.

                          *********

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
C. de Roda, Ronald P. Villavelez 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-
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are $25 each.  For subscription information, contact Christopher
Beard at 240/629-3300.

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