TCR_Public/011126.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

           Monday, November 26, 2001, Vol. 5, No. 230

                           Headlines

ANC RENTAL: Gets Okay to Continue of Cash Investment Practices
ADVANCED GLASSFIBER: S&P Drops Ratings on Weak Market Condition
AMERICAN SKIING: High Debt Level to Affect Future Operations
BGF INDUSTRIES: S&P Ratchets Ratings A Notch Lower
BETHLEHEM STEEL: Creditors' Panel Taps Kramer Levin as Counsel

BURLINGTON: Gets Approval to Maintain Cash Management System
CHAPARRAL RESOURCES: Delays Form 10-Q Filing for Sept. Quarter
CHEROKEE INTERNATIONAL: Lower Sales Prompts S&P to Junk Ratings
COLOR SPOT: Completes Restructuring of $100MM Senior Sub. Notes
COMDISCO: Seeks Plan Filing Exclusivity Extension to March 15

CONSECO FINANCE: Fitch Lowers Ratings to CCC on Possible Default
CONSECO INC: CFC Downgrade Prompts Fitch to Drop Ratings Again
CONSTELLATION 3D: Reaches Deal for $15MM in Equity Financing
EARTHCARE: PricewaterhouseCoopers Doubts Ability to Continue
ENRON CORP: Reaffirms Commitment to Proposed Merger with Dynergy

ETOYS INC: Wants Exclusive Period Extended to January 16
EXODUS COMMS: Seeks Okay to Assume Senior Executive Agreements
FEDERAL-MOGUL: Taps R.R. Donnelley as Noticing Agent
FOCAL COMMUNICATIONS: Fitch Junks Senior Notes and Bank Facility
FRUIT OF THE LOOM: Judge Walsh Rejects $30MM Termination Fee

GENESIS WORLDWIDE: Walter W. Stasik Appointed as New CEO
HEAFNER TIRE: S&P Lowers Ratings a Notch on Poor Performance
HOUSE2HOME INC: Commences Inventory Liquidation Process
JAM JOE: Court Extends Lease Decision Deadline to January 31
KELLSTROM: Faces Nasdaq Delisting Due To Form 10-Q Filing Delay

KEYSTONE: Prolonged Industry Slump Causes Strain on Liquidity
LTV CORP: Cleveland-Cliffs Assessing Impact of Shut-Down Plan
LODGIAN: S&P Further Cuts Junk Ratings & Maintains Watch
LOEWEN GROUP: Deems CTA-Related Fees 'Unrealistically High'
MATTRESS DISCOUNTERS: Likely Default Spurs S&P to Junk Ratings

METALS USA: Gets Okay to Use Existing Cash Management Systems
NATIONSRENT: S&P Junks Ratings & Expects Bankruptcy Filing
NETIA HOLDINGS: S&P Junks Ratings Over Higher Credit Risk Level
NETZEE: Sells Digital Visions to SS&C Tech. For $1.35MM + Debts
OWENS CORNING: Seeks to Defend & Indemnify Employee Defendants

PILLOWTEX: Wants Plan Filing Exclusivity Extended to March 15
PINNACLE HOLDINGS: S&P Junks Ratings Citing Liquidity Concerns
PRECISION AUTO: Net Loss Narrows to $1.9MM in September Quarter
RELIANCE GROUP: Hires LeBoeuf Lamb as Special Tax Counsel
SERVICE MERCHANDISE: Delays 10-Q Filing for September Quarter

SUNSHINE PCS: Ernst & Young Doubts Ability to Continue
TXU: Sells UK Distribution Business to London Electricity Group
TEAM MUCHO: Nasdaq to Delist Shares for 10-Q Filing Delinquency
TRICO STEEL: Selling Substantially All Assets to Nucor for $120M
TRUSERV CORPORATION: Appoints Pamela Forbes Lieberman as New CEO

US MINERAL: Seeks to Extend Exclusive Period to May 25, 2002
WINSTAR COMMS: Seeks Removal Period Extension Until March 14
XEROX CORP: Fitch Rates 144A Convertible Trust Preferred at B+

* BOND PRICING: For the week of November 26 - 30, 2001

                           *********

ANC RENTAL: Gets Okay to Continue of Cash Investment Practices
--------------------------------------------------------------
All of the excess funds of ANC Rental Corporation, and its
debtor-affiliates are presently on deposit with First Union
National Bank or PNC and are invested in an Evergreen Account or
a Provident Account which, in accordance with the Debtors'
credit agreement, can only invest such funds in the following
authorized investments:

a. marketable direct obligations issued by, or unconditionally
    guaranteed by, the United States Government or issued by
    any agency thereof and backed by the full faith and credit
    of the United States, in each case maturing within one year
    from the date of acquisition;

B. certificates of deposit, time deposits, eurodollar time
    deposits or bankers' acceptances having maturities of one
    year or less from the date of acquisition and overnight
    bank deposits issued by any lender or by any commercial
    bank having combined capital and surplus of not less than
    $500,000,000 and whose long-term debt is rated at the time
    of acquisition thereof at least A or the equivalent thereof
    by Standard & Poor's Rating Services or at least A or the
    equivalent thereof by Moody's Investors Service, Inc.;

C. commercial paper of an issuer rated at least A-2 by S&P or P-
    2 by Moody's, or carrying an equivalent rating by a
    nationally recognized rating agency, if both of the two
    named rating agencies cease publishing ratings of
    commercial paper issuers generally, and maturing within one
    year from the date of acquisition;

d. securities with maturities of one year or less from the date
    of acquisition issued or fully guaranteed by any state,
    commonwealth or territory of the United States, by any
    political subdivision or taxing authority of any such
    state, commonwealth, territory or by any foreign
    government, the securities of which state, commonwealth,
    territory, political subdivision, taxing authority or
    foreign government are rated at least A by S&P or A by
    Moody's;

E. securities with maturities of one year or less from the date
    of acquisition backed by standby letter of credit issued by
    any lender or any commercial bank satisfying the
    requirements of clause; and

F. shares of money market, mutual or similar funds which invest
    exclusively in assets satisfying the requirements of
    clauses (a) through (e).

By motion, the Debtors seek authorization to continue to invest
the excess cash remaining in the Debtors' accounts in Authorized
Investments under normal commercial terms.

Bonnnie Glantz Fatell, Esq., at Blank Rome Comisky & Macauley
LLP in Wilmington, Delaware, tells the Court that such
investment will enable the Debtors to maintain the security of
their investment, while at the same time providing the Debtors
with the ability to maximize their income. The Debtors believe
that their continued investment in the Authorized Investments
substantially complies with the requirements of section 345 of
the Bankruptcy Code but nevertheless, seek to waive the
application of section 345 to the extent that the Authorized
Investments do not technically conform to the investment
practices required therein.

Ms. Fatell submits that the investment of the Debtors' excess
cash in certain Authorized Investments provides the Debtors with
important income that is essential for the operation of the
Debtors' business while, at the same time, maintaining the
security of the Debtors' cash. The Authorized Investments are of
a type generally considered to be conservative, low risk
investments, with the primary goal of protecting principal and
the secondary goal of generating yield and providing liquidity.
The Debtors believe that it is unlikely that their customary
banking institutions would be willing to provide a bond as set
forth in section 345(b), and that such a requirement, in light
of the safety of the investment, would be costly and completely
unnecessary.

Ms. Fatell points out that strict compliance with the
requirements of section 345(b) in these cases would be
inconsistent with section 345(a) where the Debtors' investments
in the Authorized Investments will maximize their income while
providing the protection contemplated by section 345(b) of the
Bankruptcy Code, notwithstanding the absence of a "corporate
surety" requirement. Any corporate surety that might be obtained
to guarantee the safety of the Debtors' investment would likely
not have significantly greater financial strength than the
private entities in which the Debtors invest. Ms. Fatell adds
that a bond secured by the undertaking of a corporate surety
would be expensive, if such bond is available at all, and could
offset much of the financial gain derived from investing in
private as well as federal or federally guaranteed securities.
In other large chapter 11 cases in this district, courts have
waived the requirement of section 345(b) that a debtor obtain a
bond from any entity with which its money is deposited or
invested and replaced such requirement with alternative
procedures. In order not to deny the Debtors the opportunity to
earn this important income, Ms. Fatell asserts that the Court
should dispense with any bond requirement and approve the
investment in the Authorized Investments.

                          *   *  *

Finding the relief requested is necessary to the ongoing
operations of the Debtors' business and in the best interests of
the Debtors and their estates, and creditors, Judge Walrath
authorizes the Debtors to invest cash in authorized investments
and orders that the bond requirement is waived. (ANC Rental
Bankruptcy News, Issue No. 2; Bankruptcy Creditors' Service,
Inc., 609/392-0900)


ADVANCED GLASSFIBER: S&P Drops Ratings on Weak Market Condition
---------------------------------------------------------------
Standard & Poor's lowered its ratings on Advanced Glassfiber
Yarns LLC and placed them on CreditWatch with negative
implications.

The downgrade is the result of continued weakness in key
electronics and, to a lesser extent, industrial end markets. The
CreditWatch listing reflects uncertainty regarding the outcome
of negotiations to amend the company's bank credit agreement.
Management has indicated that the company is unlikely to be in
compliance with existing financial covenants as of December 31,
2001.

Aiken, South Carolina-based Advance Glassfiber is a leading
global supplier of glass yarns used in a variety of applications
including: printed circuit boards, roofing materials, filtration
equipment, and reinforced tapes.  Advanced Glassfiber's majority
(51%) owner is unrated France-based Porcher Industries Group
(Porcher), which also owns 100% of BGF Industries Inc.
(B/Negative/--), one of Advanced Glassfiber's major customers.
The remainder of Advanced Glassfiber is owned by Owens Corning.
Advanced Glassfiber relies on Owens Corning for critical support
in the supply of specialized equipment and other areas. No
disruption in operations related to Owens Corning's bankruptcy
has been experienced or is expected.

The ratings reflect Advance Glassfiber's good position in the
technically demanding manufacture of glass fibers, offset by a
relatively narrow product mix, sales to cyclical end markets,
customer concentration, and an aggressive financial profile.

Although cost reductions have kept operating margins (before
depreciation) fairly stable in the upper-20% area, lower sales
volumes and a negative product mix shift are depressing
earnings. Moreover, financial performance could come under
increased pressure if sales to construction end markets--which
have held up relatively well so far--decline. Although
reductions in inventories, capital spending, and operating costs
should permit the company to operate without increasing debt
significantly, cash flow generation is likely to remain weak
relative to already aggressive debt levels. In addition, the
company faces meaningful near-term debt maturities.

The ratings will be reviewed again once the outcome of
negotiations to amend the bank credit facility is known.

              Ratings Lowered and Placed on Creditwatch
                     With Negative Implications

                                               Ratings
Advanced Glassfiber Yarns LLC        To         From

         Corporate credit rating            B          B+
         Senior secured bank loan rating    B          B+
         Subordinated debt                  CCC+       B-


AMERICAN SKIING: High Debt Level to Affect Future Operations
------------------------------------------------------------
For the fiscal year ended July 29, 2001 American Skiing Company
had net revenues of $425,569 as compared to the year 2000 net
revenues of $424,140.  Net losses were $144,081 in fiscal 2001,
and $51,127 in fiscal 2000.

The Company is highly leveraged.  As of November 1, 2001, it had
outstanding $435.5 million of total indebtedness, including
$296.1 million of secured indebtedness, representing 66.3% of
the Company's total capital.

The high level of debt affects future operations in several
important ways.  First of all, American Skiing will have
significant cash requirements to service its debt which will in
turn reduce the funds available for operations, capital
expenditures and acquisitions. A decrease in the availability of
funds will make the Company more vulnerable to adverse  general
economic and industry conditions.  Secondly, the financial
covenants and other restrictions contained in Company debt
agreements require it to meet certain financial tests and
restrict its ability to borrow additional funds, make capital
expenditures or sell assets.

American Skiing's ability to make scheduled payments or
refinance its debt obligations will depend on its future
financial and operating performance, which will be affected by
prevailing economic conditions, financial, business and other
factors. There can be no assurance that Company operating
results, cash flow and capital resources will be sufficient
to pay Company indebtedness.  If operating results, cash flow or
capital resources prove  inadequate American Skiing could face
substantial liquidity problems and might be required to dispose
of material assets or operations to meet debt and other
obligations.  The Company also could be forced to reduce or
delay planned expansions and capital expenditures, sell assets,
restructure or refinance our debt or seek additional equity
capital.  There can be no assurance that any of these actions
could be effected on terms satisfactory to its business,
if at all.


BGF INDUSTRIES: S&P Ratchets Ratings A Notch Lower
--------------------------------------------------
Standard & Poor's lowered its ratings on BGF Industries Inc. The
current outlook is negative.

The downgrade stems from expectations that poor conditions in
electronics and filtration end markets will persist in the near
term, and that sales to the aerospace sector will deteriorate,
causing credit protection measures to weaken more than had been
expected. In addition, financial flexibility has been reduced
following a recent amendment to the company's bank credit
agreement.

Greensboro, North Carolina-based BGF is a leading manufacturer
of glass fiber and other high performance fabrics used in
electronic, aerospace, marine, filtration, insulation, and
construction products. The ratings reflect a relatively narrow
product mix and modest sales base, cyclical end markets,
significant customer and supplier concentration, and aggressive
debt leverage.

BGF is wholly owned by unrated France-based Porcher Industries
Group (Porcher), which also owns 51% of Advanced Glassfiber
Yarns LLC (B/CreditWatch Negative/--). The other 49% of Advanced
Glassfiber is owned by Owens Corning. Advanced Glassfiber is one
of BGF's two primary glass fiber yarn suppliers.

Sales of electronics fabrics used in multi-layer and rigid
printed circuit boards (historically about half of BGF's
revenues) have declined dramatically in conjunction with lower
capital spending in the information technology and
telecommunications industries. Sales for filtration
applications, less significant for BGF, have fallen due to fewer
large utility projects and a downturn in the steel and foundry
industries. BGF's second largest market, composite materials, is
likely to suffer a drop in orders from the aerospace industry
due to uncertainty over airline traffic recovery.

A recent amendment to BGF's bank credit agreement provided
needed covenant relief. However, availability declined
significantly following a reduction in the size of the facility
(to $50 million from $60 million) and use of the line to repay a
$15.6 million term loan, leaving $20 million available as of
Sept. 30, 2001.

In the near term, continued sales weakness and low capacity
utilization and are expected to keep EBITDA interest coverage
very weak at about 1 time. However, completion of a significant
capital project, lower inventories, and workforce reductions
should lessen cash needs meaningfully during the next few
quarters, curbing further deterioration in the credit profile.

                      Outlook: Negative

Worse-than expected market conditions or dwindling liquidity
during the next few months would lead to another downgrade.

                       Ratings Lowered

                                             Ratings

      BGF Industries Inc.                To           From
         Corporate credit rating         B            B+
         Senior secured bank loan rating B            B+
         Subordinated debt               CCC+         B-


BETHLEHEM STEEL: Creditors' Panel Taps Kramer Levin as Counsel
--------------------------------------------------------------
The Official Committee of Unsecured Creditors of Bethlehem Steel
Corporation seeks the Court's authority to retain Kramer Levin
Naftalis & Frankel LLP, as counsel, nunc pro tunc to October 23,
2001.

On behalf of the Committee, Michael Hughes of Electronic Data
Systems Corporation explains they have selected Kramer Levin
primarily because the firm's Bankruptcy Department has extensive
experience in the fields of bankruptcy and creditors' rights
and, in particular, has represented creditors' committees in
some of the largest and most complex chapter 11 reorganization
cases of recent years.  Furthermore, Mr. Hughes notes that
Kramer Levin's broad-based practice -- which includes expertise
in the areas of corporate and commercial law, litigation, tax,
intellectual property, employee benefits and real estate -- will
permit it to represent fully the interests of the Committee in
an efficient and effective manner.

The Committee expects Kramer Levin to render legal services that
the Committee may consider desirable to discharge the
Committee's responsibilities and further the interests of the
Committee's constituents in these cases.  In addition to acting
as primary spokesman for the Committee, Mr. Hughes says, Kramer
Levin's services will include, without limitation, assisting,
advising and representing the Committee with respect to these
matters:

     (a) The administration of these cases and the exercise of
         oversight with respect to the Debtors' affairs including
         all issues arising from the Debtors, the Committee or
         these Chapter 11 Cases;

     (b) The preparation on behalf of the Committee of necessary
         applications, motions, memoranda, orders, reports and
         other legal papers;

     (c) Appearances in Court and at statutory meetings of
         creditors to represent the interests of the Committee;

     (d) The negotiation, formulation, drafting and confirmation
         of a plan or plans of reorganization and matters related
         thereto;

     (e) Such investigation, if any, as the Committee may desire
         concerning, among other things, the assets, liabilities,
         financial condition and operating issues concerning the
         Debtors that may be relevant to these Chapter 11 Cases;

     (f) Such communication with the Committee's constituents and
         others as the Committee may consider desirable in
         furtherance of its responsibilities; and

     (g) The performance of all of the Committee's duties and
         powers under the Bankruptcy Code and the Bankruptcy
         Rules and the performance of such other services as are
         in the interests of those represented by the Committee.

In return for the services, Kramer Levin expects to receive
compensation and reimbursement in accordance with its standard
billing practices, in accordance with the provisions of the
Bankruptcy Code, or as otherwise ordered by the Court.  Mr.
Hughes outlines the principal attorneys expected to represent
the Committee in this matter and their current hourly rates:

            Thomas Moers Mayer     $ 525 per hour
            Mitchell A. Seider       435
            James C. McCarroll       300

In addition, Mr. Hughes says, other attorneys and
paraprofessionals may from time to time provide services to the
Committee in connection with these bankruptcy proceedings.  The
range of Kramer Levin's hourly rates for its attorneys and legal
assistants is:

            Partners           $400 - 575
            Counsel             420 - 575
            Associates          200 - 395
            Legal Assistants    150 - 165

Mr. Hughes advises the Court that Kramer Levin's hourly billing
rates are subject to periodic adjustments to reflect economic
and other conditions.  Moreover, Mr. Hughes notes, Kramer
Levin's hourly billing rates for professionals are not intended
to cover out-of-pocket expenses and certain elements of overhead
that are typically billed separately.  Accordingly, Mr. Hughes
explains, Kramer Levin regularly charges its clients for the
expenses and disbursements incurred in connection with the
client's case, including, inter alia, word processing,
secretarial time, telecommunications, photocopying, postage and
package delivery charges, court fees, transcript costs, travel
expenses, expenses for "working meals" and computer-aided
research.

Thomas Moers Mayer, a member of the Kramer Levin firm, reports
that they conducted a conflict check to determine whether Kramer
Levin has connections to the parties-in-interest in these cases.
Based on this review process, Mr. Mayer relates, it appears that
Kramer Levin does not hold or represent an interest that is
adverse to the Debtors' estates.  "Kramer Levin is a
disinterested person who does not hold or represent any interest
adverse to and has no connection with the Debtors, their
creditors or any party-in-interest in the matters upon which
Kramer Levin is to be retained," Mr. Mayer assures the Court.

Kramer Levin discloses that:

     (a) General Electric Capital Corporation is the lead DIP
         lender to Bethlehem Steel and the Administrative Agent
         under a Revolving Credit Agreement and Guaranty dated as
         of October 15, 2001.  In matters unrelated to the
         Debtors, Kramer Levin represents or has represented GE
         Capital and its affiliates, in connection with:

          (i) a variety of real estate, environmental litigation
              and general litigation matters, and

         (ii) the purchase and/or sale of distressed debt and
              securities.

         GE Capital has indicated that it expects to consent to
         Kramer Levin's representation of the Committee and has
         agreed that Kramer Levin may represent the Committee in
         matters adverse to GE Capital in the Debtors' cases,
         including the commencement of proceedings to block
         relief sought by GE Capital, excluding, however, any
         legal proceeding to seek affirmative recovery from GE
         Capital, such as damages for lender liability.

     (b) JP Morgan Chase is a pre-petition secured inventory
         lender and the agent for the inventory facility. In
         matters unrelated to the Debtors, Kramer Levin
         represents or has represented JP Morgan Chase (and/or
         its predecessors in interest variously called The Chase
         Manhattan Bank and Morgan Guaranty Trust Company) in
         connection with:

           (i) various federal and state tax issues,
          (ii) ERISA matters,
         (iii) certain corporate trust matters, and
          (iv) JP Morgan Chase's extension of credit to companies
               not related to the Debtors as a member of a bank
               syndicate represented by Kramer Levin.

         In addition, Kramer Levin represents or has represented
         the independent directors of certain funds that are
         managed or sponsored by JP Morgan Chase.  JP Morgan
         Chase has indicated to Kramer Levin that it will consent
         to Kramer Levin's representation of the Committee and
         has agreed that Kramer Levin may represent the Committee
         in matters adverse to JP Morgan Chase in the Debtors'
         cases, including the examination of liens and security
         interests securing JP Morgan Chase and the other secured
         inventory lenders and participation in proceedings to
         block relief sought by JP Morgan Chase, excluding,
         however, any legal proceeding to seek affirmative
         recovery from JP Morgan Chase, such as damages for
         lender liability.

     (c) UBS Warburg, AG is a pre-petition secured inventory
         lender.  In matters unrelated to the Debtors, Kramer
         Levin represents UBS, AG or its affiliates in connection
         with:

          (i) various employee benefit matters, and
         (ii) the purchase and/or sale of distressed debt and
              securities.

     (d) The Bank of New York is a pre-petition secured inventory
         lender and the paying agent for the Debtors' 10% notes
         and 8.45% debentures.  In matters unrelated to the
         Debtors, Kramer Levin represents and has represented The
         Bank of New York in connection with:

           (i) a private venture fund,
          (ii) various litigation matters, including the defense
               of a claim for pension benefits, and
         (iii) the issuance of bonds by the Province of Santiago
               del Estero.

     (e) Citibank, N.A. is a pre-petition secured inventory
         lender. In matters unrelated to the Debtors, Kramer
         Levin represents Citibank, N.A. with respect to various
         corporate, litigation, tax, intellectual property and
         ERISA matters.  Kramer Levin also uses Citibank, N.A. as
         its principal commercial bank.

     (f) Deutsche Bank provides custodial services for the
         Debtors' pension and insurance plan. In matters
         unrelated to the Debtors, Kramer Levin represented
         Deutsche Bank in connection with ERISA matters, and
         provides investment and legal advice to Deutsche Bank
         Asset Management, an affiliate of Deutsche Bank.

     (g) Fleet National Bank is a pre-petition secured inventory
         lender.  In matters unrelated to the Debtors, Kramer
         Levin represents Fleet National Bank in connection with
         a private venture fund, various litigation matters and
         as a participant in various bank groups. Kramer Levin
         also represents the independent directors of certain
         funds sponsored or administered by Fleet National Bank
         or an affiliate thereof.

     (h) Wilmington Trust is a pre-petition secured inventory
         lender and is listed in the Debtors' Schedules as a
         secured creditor party to a sale/leaseback transaction.
         Wilmington Trust is also indenture trustee for the
         Debtors' 8.45% debentures, and in that capacity is a
         member of the Committee.  In matters unrelated to the
         Debtors, Kramer Levin has represented Wilmington Trust
         in connection with Wilmington Trust acting as Corporate
         Trustee on certain corporate finance projects.

     (i) State Street Bank maintains the Debtors' hourly profit
         sharing plan account.  In matters unrelated to the
         Debtors, Kramer Levin has represented a bondholder group
         where State Street Bank was the Indenture Trustee.
         Prior to January 2001, Kramer Levin's Paris office
         represented State Street Banque, a French affiliate of
         State Street Bank and Trust Company, in several discrete
         transactions, but did not represent State Street itself.
         Beginning in January 2001, Kramer Levin's Paris office
         undertook a limited representation of State Street
         pertaining to the issuance of Exchange Traded Funds.
         This representation is ongoing. Two attorneys and one
         paraprofessional from Kramer Levin's Financial Services
         Department in New York have provided, and may continue
         to provide, limited services to Kramer Levin's Paris
         office with respect to the Paris Office State Street
         Retention.  No attorney or paraprofessional involved in
         the Bethlehem Steel bankruptcy case has done any work,
         or received any documents or information, with respect
         to the Paris Office State Street Retention.

     (j) Bank of America is a pre-petition secured inventory
         lender and has extended additional credit secured by a
         building and rolling mill at Port of Indiana, Indiana.
         In matters unrelated to the Debtors, Kramer Levin or has
         represented:

          (i) Bank of America as a participant in a bondholder
              group, a bank group and as an agent bank, and
         (ii) Independent Directors of Nations Funds, a group of
              registered investment companies that are managed by
              Bank of America.

     (k) PNC Bank, N.A. maintains several of the Debtors' trust
         accounts.  In matters unrelated to the Debtors, Kramer
         Levin represents PNC Bank in connection with its
         membership in a bank group.

     (l) In matters unrelated to the Debtors, Kramer Levin has
         represented CSX Transportation (one of the Debtors' 30
         largest unsecured creditors) in connection with
         environmental matters. That representation has
         terminated.

     (m) James McCarroll joined Kramer Levin Naftalis & Frankel
         LLP as an associate in its Creditors' Rights Department
         in 1999. Prior to joining Kramer Levin, Mr. McCarroll
         had worked as an attorney in the general counsel's
         office of the Pension Benefit Guaranty Corporation (one
         of the members of the Official Committee of Unsecured
         Creditors) from 1998 to 1999. While at Pension
         Corporation, Mr. McCarroll worked extensively on two
         steel industry related cases. However, Mr. McCarroll did
         not receive any information regarding the Debtors, nor
         did he have any contact with the Debtors.

     (n) As part of Kramer Levin's creditors' rights practice,
         Kramer Levin represents agent banks, bank groups,
         shareholder groups, bondholder groups and creditors'
         committee in connection with restructuring, bankruptcy
         and corporate matters. The Debtors have numerous
         creditors and other parties-in-interest. Kramer Levin
         may have in the past represented, and may presently or
         in the future represent or be deemed adverse to,
         creditors or parties-in-interest in addition to those
         specifically disclosed herein in matters unrelated to
         these cases. Kramer Levin believes that its
         representation of such creditors or other parties in
         such other matters has not and will not affect its
         representation of the Committee in these proceedings.

     (o) Kramer Levin's creditors' rights practice also involves
         representing buyers and sellers of distressed debt and
         securities. One or more clients of the firm may now or
         later purchase secured or unsecured claims against one
         or more Debtors. Kramer Levin believes that its
         representation of such parties in matters unrelated to
         the Debtors will have no effect on its representation of
         the Committee in these proceedings. Of course, Kramer
         Levin will not represent any entity in the purchase or
         sale of any debt or securities of the Debtors during
         Kramer Levin's representation of the Committee herein.

     (p) In addition to its creditors' rights practice, Kramer
         Levin is a full service law firm with very active real
         estate, intellectual property, corporate and litigation
         practices. Kramer Levin appears in cases, proceedings
         and transactions involving many different attorneys,
         accountants, financial consultants and investment
         bankers, some of which now or may in the future
         represent claimants or parties in interest in these
         cases.  Kramer Levin has not and will not represent any
         of such entities in relation to the Debtors in these
         chapter 11 cases nor have any relationship with any such
         entity, attorneys, accountants, financial consultants,
         and investment bankers which would be adverse to the
         Committee, the Debtors or their estates.

According to Mr. Mayer, none of these institutions, who are both
parties-in-interest and clients of Kramer Levin, accounted for
more than 1% of the firm's revenues in its last fiscal year.
(Bethlehem Bankruptcy News, Issue No. 5; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


BURLINGTON: Gets Approval to Maintain Cash Management System
------------------------------------------------------------
Prior to the Petition Date, Burlington Industries, Inc., and its
debtor-affiliates maintained 75 bank accounts, including,
deposit accounts, operating accounts, collateral accounts, or
miscellaneous, special purpose accounts, out of which they
managed cash receipts and disbursements.

The principal components of the Debtors' Cash Management System
and the flow of funds through the Pre-petition Bank Accounts in
that system are:

(A) Domestic Cash Collection and Concentration

    The Debtors maintain a concentration account at Wachovia Bank
    N.A.  Funds are transferred into the Concentration Account
    from 3 primary sources:

    (1) the Debtors' non-debtor subsidiary, BI Funding, Inc.,
    (2) various zero balance accounts, and
    (3) miscellaneous direct electronic transfers.

    BI Funding maintains 4 lockbox accounts: 2 at Wachovia, 1 at
    Bank of America, N.A., and 1 at First Union National Bank.
    On a daily basis, deposits collected in the Lockbox Accounts
    are deposited into BI Funding's main collection account at
    Wachovia and available funds are transferred on BI Funding's
    and the Debtors' books from the Receivables Account and
    credited to the Concentration Account.

    The Debtors maintain various zero balance accounts at
    Wachovia primarily for foreign denominated collections from
    non-factored customers and medical premiums collected from
    retirees.  Deposits into these zero balance accounts are
    transferred on the Debtors' books each day into the
    Concentration Account.

    Periodically, the Debtors receive electronic payments into
    the Concentration Account.  These payments result primarily
    from:

    (1) customers who have not paid by a check deposited into
        one of the Lockbox Accounts for payment of invoices, and

    (2) the sale of assets.

(B) Disbursements

    All of the Debtors' material disbursement accounts are funded
    from the Concentration Account.  Disbursements from General
    Disbursement Accounts primarily include accounts payable,
    payroll, multiple voluntary employee beneficiary association
    trust accounts, and foreign exchange.  All of the General
    Disbursement Accounts are maintained at Wachovia.

(C) Excess Funds

    On a given day, excess funds can be invested overnight by
    Wachovia or Bank One, N.A.  The funds are invested primarily
    in either A1-P1 commercial paper or Eurodollar time deposits.
    Alternatively, excess funds can be left in the Concentration
    Account for which the Debtors receive credits toward their
    monthly account analysis fees.

(D) Foreign Accounts

    The Debtors maintain a number of foreign accounts, including,
    collection accounts, deposit accounts, operating accounts,
    collateral accounts, or miscellaneous, special purpose
    accounts, out of which they manage cash receipts from or
    disbursements to foreign sources.  The Concentration Account
    is the primary funding source for these accounts, which
    include all of the peso accounts associated with the
    operations of the Debtors' non-debtor affiliates in Mexico.
    The Debtors also maintain 4 foreign accounts that are not
    funded from the Concentration Account:

    (1) ScotiaBank Canadian Dollar Lockbox Account

        Receipts for the Debtors' sales in Canada are deposited
        into this lockbox account.  Checks are issued against
        this account for any payables due in Canadian Dollars.
        The Canadian Dollar balance also is used periodically to
        settle maturing foreign exchange hedge contracts.

    (2) HSBC Bank ple Sterling Account

        Deposits are made to this account from customers of
        foreign export collections received in Sterling.  A
        target balance of approximately o50,000 Sterling is
        maintained.  Balances in excess of the target balance are
        periodically transferred to the Concentration Account or
        used to settle maturing foreign exchange hedge contracts.
        Checks are issued against this account for payables,
        value added taxes and duty payments due in Sterling.

    (3) HSBC Bank ple Dollar Account

        Various currencies received from customers for factored
        export collections are converted at least once per week
        and deposited as U.S. currency into this account.  On a
        weekly basis, the account balance is transferred by wire
        into the Bank of America general account.

    (4) Bank of America General Account

        Deposits are made into this account from the weekly
        transfers from the HSBC U.S. Dollar Account.  Funds from
        customers' letters of credit are also received in this
        account.  If excess funds build up in this account, the
        funds are transferred to the Concentration Account.

In the light of the substantial size and complexity of the
Debtors' affairs - John D. Englar, Burlington Industries' Senior
Vice President for Corporate Development and Law, asserts that a
successful reorganization of the Debtors, as well as the
preservation and enhancement of the Debtors' respective values
as going concerns, cannot be properly achieved if cash
management procedures are substantially disrupted.  Therefore,
Mr. Englar contends, it is essential that the Debtors be
permitted to continue to consolidate the management of cash and
transfer of money from entity to entity as needed, in the
amounts necessary to continue business operations and in
accordance with their existing cash management procedures.

According to Mr. Englar, the Debtors have utilized the Cash
Management System for many years and it constitutes a customary
and essential business practice.  The existing Cash Management
System allows the Debtors to:

     (a) control and monitor corporate funds,
     (b) invest idle cash,
     (c) ensure cash availability, and
     (d) reduce administrative expenses by facilitating the
         movement of funds and the development of timely and
         accurate account balance and presentment information.

These controls, Mr. Englar explains, are especially important
for the Debtors given the significant volume of cash
transactions - aggregating more than $4,000,000,000 annually -
that is managed through the Cash Management System.

If the Debtors are forced to establish an entirely new system of
accounts and a new cash management and disbursement system for
each separate legal entity, Mr. Englar says, it would be
difficult and unduly burdensome for the Debtors - given the
Debtors' organizational and financial structure and the number
of entities participating in the Cash Management System.

Thus, by this motion, the Debtors seek the Court's authority to
use the Cash Management System - as such system may be modified
pursuant to the requirements of the Debtors' proposed debtor-in-
possession financing facility.

Finding merit in the relief requested, Judge Walsh authorizes
the Debtors to continue to use the Cash Management System.
(Burlington Bankruptcy News, Issue No. 2; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


CHAPARRAL RESOURCES: Delays Form 10-Q Filing for Sept. Quarter
--------------------------------------------------------------
Chaparral Resources, Inc., owns an interest in oil and gas
properties in a foreign country through a subsidiary, which has
a 50% interest in a foreign entity that owns the interest in the
oil and gas properties. Chaparral has been advised that delays
have been encountered in completing the financial information
for such entities. Therefore, Chaparral Industries is unable to
obtain the required financial information for the quarter ended
September 30, 2001, in order for the Company's Quarterly Report
on Form 10-Q to be filed with the SEC within the prescribed time
period.

Chaparral expects to report a net loss between $1,400,000 and
$1,600,000 for the three months ended September 30, 2001, and
reported a net loss of $23,114,000 for the three months ended
September 30, 2000. The decrease in the loss was primarily due
to the September 2000 conversion of $20,846,000 in aggregate
principal amount of the Company's 8% Non-Negotiable Convertible
Promissory Notes, plus accrued interest, into 11,690,259 shares
of the Company's common stock at an exercise price of $1.86 per
share. Applying EITF 98-5, Accounting for Convertible Securities
with Beneficial Conversion Features or Contingently Adjustable
Conversion Ratios, the Company recorded additional debt discount
upon conversion of the Notes equal to the face value of the
Notes, less original discount, or $20,340,000. The additional
discount was expensed immediately upon discharge of the
underlying indebtedness. Otherwise, the Company's overall loss
decreased from the prior year due to increased equity income
from investment based upon revenues generated from the sale of
hydrocarbons from the Karakuduk Field.

Chaparral Resources is currently pursuing talks with Shell
Capital to restructure its defaulted $3.3 million loan.


CHEROKEE INTERNATIONAL: Lower Sales Prompts S&P to Junk Ratings
---------------------------------------------------------------
Standard & Poor's lowered its corporate credit and bank loan
ratings on Cherokee International LLC to triple-'C'-plus from
single-'B' and its subordinated debt rating to triple-'C'-minus
from triple-'C'-plus. At the same time, all the ratings were
removed from CreditWatch with negative implications where they
were placed August 17, 2001. The outlook is negative.

The ratings action is based on significantly lower sales and
profitability, resulting in very weak credit measures. Tustin,
California-based Cherokee is a leading designer and manufacturer
of a broad range of switch mode power supplies for original
equipment manufacturers primarily in the telecommunications,
networking, and high-end workstation industries.

The ratings reflect Cherokee's niche market position and highly
leveraged financial profile that leave the company susceptible
to weaker economic environment and a downturn in demand.
Cherokee generates the majority of its sales from the
communications market segment, particularly the networking and
telecommunications sectors. Reduced capital spending by
communication service providers negatively affected sales in the
last few quarters and could lead to further sales deterioration
in the near term, adversely affecting already weak operating and
financial performance.

Sales decreased by almost 40% to $26.0 million for the three
months ended September 30, 2001, from the same period in the
previous year. The sales decline was particularly pronounced in
Cherokee's North American operations where sales fell by just
more than one-half to about $15 million in the third quarter
compared to the same period last year. Consequently, operating
margins dropped by more than one-half to about 11% for the third
quarter and are likely to remain depressed in the near to
intermediate term.

Cash flow protection measures are very weak with EBITDA coverage
of interest deteriorating to below 1 times in the third quarter
because the company generated just $3 million in EBITDA.
Cherokee is highly leveraged with $156 million in debt and
EBITDA of $25 million during 12 months ended September 30, 2001.
However, nearly $15 million in cash from operations was
generated in the nine months ended September 2001 due to
improved management of working capital as demand slackened.
Financial flexibility is limited by availability under its $25
million facility that had less than $15 million available as of
September 30, 2001. Amortizations under its term facility of
$8 million in 2002 are considerable and further limit
flexibility.

                          Outlook: Negative

The ratings could be lowered in the near term unless the company
enhances its weak liquidity position.


COLOR SPOT: Completes Restructuring of $100MM Senior Sub. Notes
---------------------------------------------------------------
Color Spot Nurseries announced that it has closed its previously
communicated financial restructuring. As unanimously approved by
its bondholders, the restructuring materially reduces its debt
balance through the conversion of $100 million of its senior
subordinated notes into a combination of new senior subordinated
notes and preferred stock, which will immediately improve the
Company's cash flow and financial flexibility. The Company
contemporaneously closed a two-year renewal of its existing
senior secured credit facility with its senior lender, Fleet
Capital Corporation.

Dave Barrett, Chief Executive Officer, said, "We are pleased to
announce this successful closing of our financial restructuring
and credit facility. In light of a challenging economic and
banking climate, this closing is a validation of our results and
our vision for the future. Now is the time for us to pursue our
exciting growth plans and win in the marketplace by thrilling
our customers through flawless execution."

Color Spot is one of the largest wholesale nurseries in the
United States, based on revenue and greenhouse square footage.
The Company provides a wide assortment of high-quality plants as
well as extensive merchandising services primarily to leading
home centers and mass merchants, such as Home Depot, Lowe's,
Wal-Mart and Kmart. The Company distributes products to over
2,800 retail and commercial customers, primarily in the western
and southwestern regions of the United States.


COMDISCO: Seeks Plan Filing Exclusivity Extension to March 15
-------------------------------------------------------------
Comdisco, Inc., and its debtor-affiliates seek to further extend
their exclusive periods to file and solicit acceptances of the
Plan through March 15, 2002 and May 15, 2002, respectively.

According to Felicia Gerber Perlman, Esq., at Skadden, Arps,
Slate, Meagher & Flom, in Chicago, Illinois, cause exists to
grant the relief requested.  "It is undeniable that these cases
are large and complex," Ms. Perlman notes.  About 51 debtors,
foreign operations, over 100,000 creditors and parties-in-
interest and billions of dollars in assets and claims are
involved in these cases, Ms. Perlman reminds the Court.  In
addition, Ms. Perlman says, the Debtors are continuing with the
process of evaluating the sale of certain portions of their
Leasing business involving over a billion dollars of assets.

Furthermore, Ms. Perlman asserts that the Debtors have made
progress toward reorganization.   "Most significantly, the
Debtors have successfully completed the sale of their
Availability Solutions business," Ms. Perlman notes.  It was a
long and complicated sale process requiring both the Debtors and
their professionals to devote significant time and resources,
Ms. Perlman observes.  The result of this sale process brought
the estate approximately $850,000,000, including the working
capital adjustment, Ms. Perlman says.

In addition, Ms. Perlman relates, the Debtors have been
evaluating the sale of portions of the Leasing business.
According to Ms. Perlman, the Debtors have already concluded one
evaluative auction with respect to the electronics segment of
the Leasing business and have scheduled auctions with respect to
the five other segments of the Leasing business to begin on
November 29, 2001.  "The Debtors have been and will continue to
devote significant time to the potential sale of the various
Leasing business segments," Ms. Perlman emphasizes.

Moreover, Ms. Perlman reports, the Debtors' management has
expended enormous effort responding to the many exigencies and
other matters that are incidental to the commencement of any
chapter 11 case, but which are compounded by the size and
complexity of these cases.  Ms. Perlman tells the Court that the
Debtors have been consumed with the task of responding to a
multitude of inquiries and information requests made by the
Creditors' Committee and Equity Committee, the post-petition
lenders, as well as many foreign and domestic banks, vendors,
customers, landlords, bondholders, shareholders and other
parties-in-interest.

"The requested extension will allow the Debtors to turn to a
reorganization plan process at a logical point in their chapter
11 cases, and seek to emerge from chapter 11 in the spring of
2002, consistent with their stated objectives at the outset of
these cases," Ms. Perlman asserts.

Ms. Perlman assures Judge Barliant that the Debtors' request for
an extension of the Exclusive Periods is not a negotiation
tactic, but instead, merely a reflection of the fact that these
cases are not yet ripe for the formulation and confirmation of a
valuable plan of reorganization.  It is only after the Debtors
have concluded the sale processes that the Debtors will have the
opportunity to lay the groundwork for the development of a long-
term business plan, and ultimately, a plan of reorganization,
Ms. Perlman explains.

Also, Ms. Perlman notes, the Debtors have sufficient liquidity
and are paying their bills when they come due.  "There is really
no harm in granting the requested extensions now because it will
be without prejudice to the right of any party to request a
termination of exclusivity at any time," Ms. Perlman contends.
(Comdisco Bankruptcy News, Issue No. 15; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


CONSECO FINANCE: Fitch Lowers Ratings to CCC on Possible Default
----------------------------------------------------------------
Fitch lowers the long-term counterparty rating to 'CCC' from 'B'
and the short-term rating to 'C' from 'B' of Conseco Finance
Corp. (CFC), a wholly-owned subsidiary of Conseco, Inc.
(Conseco). The ratings are removed from Rating Watch Negative
where they were placed on October 3, 2001. The Rating Outlook
for CFC is Negative.

Ratings in the 'CCC' category indicate that default is a real
possibility. Capacity for meeting financial commitments is
solely reliant upon sustained, favorable business or economic
developments.

CFC's current ratings reflect the company's poor earnings
performance inclusive of asset writedowns, high-risk credit
profile, and dependence on secured funding facilities, which
effectively encumber most of the company's assets. CFC took a
$345 million pre-tax charge in the third quarter of 2001 to
revalue its interest-only (I/O) residual asset, mainly related
to manufactured housing loans, which were held on the company's
balance sheet.  While Fitch believes this charge has done little
to impact the financial profile of CFC, the I/O writedown and
corresponding loss for the third quarter of 2001 has placed the
company closer to being in violation with financial covenants in
its secured warehouse financing facilities. If the company lost
access to the capital markets, CFC will be unable to execute
securitizations, and thus will be unable to generate any
positive operating cash flow on a quarterly basis. The positive
cash flow from operations is needed to repay future debt
maturities in 2002 and 2003.

CFC has been accessing the securitization markets on a regular
basis to fund its assets over the longer-term. Good execution in
the securitization markets during 2001 has allowed the company
to generate increased net cash from operations. CFC has used the
proceeds of this cash along with other financing initiatives
mainly to repay its intercompany loan to its parent.  Fitch
believes that the repayment of intercompany loan obligations
through excess operating cash, in part generated from
securitizations, has effectively put other unsecured bondholders
in a more tenuous position, as approximately $330 million in
principal balances is needed to be repaid between June and
September 2002.

In part reflecting the valuation writedown of the I/O asset in
the third quarter of 2001, CFC has experienced declining asset
quality in the past few quarters, as witnessed by higher loss
rates in the company's subprime receivable portfolios,
particularly with respect to manufactured housing loans. Fitch
is concerned about further weakness in CFC's receivables
portfolio, especially in light of a decline in the economy over
the past year. Moreover, Fitch is concerned with the credit
quality of more recently originated loans in particular the
higher concentration of repossessed refinancings (repo refi's)
in the company's manufactured housing loan portfolio. CFC has
used repo refi's as part of their loss mitigation and
remarketing practices of foreclosed manufactured housing loans
for many years. Up-front recovery rates are substantially
greater on repo-refi's versus wholesale remarketing channels.

Fitch estimates, that without the use of repo-refi's in its
remarketing function, loan losses on a quarterly basis could
increase by more than 60%. However, asset quality data indicates
that credit risk in repo-refi loans is far greater than
traditional manufactured housing loans, leaving the potential
for higher loss levels in the future periods. The company is
attempting to offset the expected higher loss rates through
increased annualized percentage rates on repo-refi loans. CFC
incurs further risk through the $1.5 billion guarantee of
payments related to subordinated pieces in its securitization
structures.

Additionally, Fitch does not believe that CFC's parent, Conseco,
is capable of providing material financial support at this time.
Consequently, Fitch views the ratings of CFC to be on a stand-
alone basis.


CONSECO INC: CFC Downgrade Prompts Fitch to Drop Ratings Again
--------------------------------------------------------------
Fitch lowered the Conseco Inc. senior debt rating to 'B-' from
'BB-', preferred stock rating to 'CCC' from 'B' and the insurer
financial strength ratings of Conseco's insurance subsidiaries
to 'BBB-' from 'BBB'. A complete list of ratings is shown below.
The ratings are removed from Rating Watch - Negative where they
were placed on October 3, 2001. The Rating Outlook is Negative.

Separately, Fitch has lowered the long-term counterparty rating
of Conseco Finance Corp. (CFC) to 'CCC' from 'B'.

The rating action on Conseco reflects primarily the
deteriorating credit quality of Conseco Finance. Conseco is
dependent on cash flow from Conseco Finance to meet holding
company cash needs. Therefore, the ratings of Conseco are
constrained by the stand-alone credit quality of Conseco
Finance.

Fitch's ratings on Conseco's insurance subsidiaries remain in
the secure category. Fitch believes that the subsidiaries are
well-capitalized and possess good liquidity. The rating actions
at the insurance operating level reflect the increased pressures
placed on those companies as a result of the aforementioned
deterioration at Conseco Finance and, subsequently, the holding
company and are not indicative of the stand-alone credit quality
of the insurance operations. However, further deterioration at
Conseco or Conseco Finance could put downward pressure on the
insurer financial strength ratings.

Conseco remains highly leveraged with a capital structure of
debt at 37%, preferred stock of 17% and common equity of 46% at
September 30, 2001. Conseco has a significant goodwill balance,
71% of equity at quarter-end.

In 2002, Conseco and Conseco Finance will have debt maturities
of approximately $312 million and $330 million, respectively.
The company will have to refinance this debt or execute other
cash raising alternatives to meet these maturities. Fitch
believes these efforts will be challenging given the difficult
economic environment and the company's limited financial
flexibility. Fitch will monitor progress as the company develops
plans to meet the 2002 maturities.

           Entity    Issue/Type   Action Rating          Outlook
           ------    ----------   -------------          -------

      Conseco Inc.
          * Long term rating Downgrade 'BB-' to 'B-'     Negative
          * Senior debt rating Downgrade 'BB-' to 'B-'   Negative
          * Short-term rating Affirm 'B'
          * Commercial paper Affirm 'B'

      Conseco Financing Trust I-VII
          * Preferred securities  Downgrade 'B' to 'CCC' Negative

      Bankers Life & Casualty Company
      Conseco Annuity Assurance Company
      Conseco Direct Life Insurance Company
      Conseco Health Insurance Company
      Conseco Life Insurance Company
      Conseco Life Insurance Company of New York
      Conseco Medical Insurance Company
      Conseco Senior Health Insurance Company
      Conseco Variable Insurance Company
      Manhattan National Life Insurance Company

      Pioneer Life Insurance Company

          * Insurer Financial
            Strength         Downgrade 'BBB' to 'BBB-'   Negative


CONSTELLATION 3D: Reaches Deal for $15MM in Equity Financing
------------------------------------------------------------
Constellation 3D, Inc. (Nasdaq: CDDD) - developer of Fluorescent
Multilayer Disc (FMD) and Card (FMC) technologies, announced
that the Company entered into a financing agreement on November
17, 2001, with an overseas investment group (the "Investor") and
C3D's majority shareholder Constellation 3D Technology Ltd., for
the investment of up to $20 million into the Company.  The
financing is subject to certain closing conditions.  The
Investor is purchasing $15 million of convertible debentures
with the right to purchase an additional $5 million of
debentures on the same terms.

In addition, the Company announced that it has negotiated an
extension of its Promissory Note to Sands Brothers Venture
Capital LLC.  Upon the funding of the Investor transaction, $2
million of existing Sands debt will be repaid and the remaining
$2 million shall have a maturity date of September 24, 2003.

Further, on November 15, 2001 the Company terminated its equity
line with the Gleneagles Fund and restructured the terms of the
sale of the $1 million executed on August 16th.  In connection
with the restructuring, Gleneagles was issued an amended
adjustment warrant.  The terms of the warrant, as amended,
provide that Gleneagles can exercise its warrant into shares of
Common Stock (at a 6% discount to market).  As a point of
reference, assuming the pricing of the warrant for the sale of
the entire $1 million of stock was determined on November 15,
2001 (when the closing bid price of the Company's common stock
was $0.66 per share), the Company would issue approximately
824,176 additional shares.

The Company is the worldwide leader in the development of high
capacity Fluorescent Multilayer Disc and Card (FMD/C)
technology.  Constellation 3D holds or has made applications for
116 worldwide patents in the field of optical data storage, and
is supported by a team of world-class scientists. Headquartered
in New York City, the Company has additional offices and
laboratories in Texas, Israel and Russia.  More information is
available at www.c-3d.net.

As of September 30, the company had a working capital deficit of
over $5 million, while total stockholders' equity deficit stood
at $5.9 million.


EARTHCARE: PricewaterhouseCoopers Doubts Ability to Continue
------------------------------------------------------------
The report of PricewaterhouseCoopers LLP audited financial
statements of EarthCare Company for the year ended December 31,
2000, expressed substantial doubt regarding EarthCare Company's
ability to continue as a going concern.

At EarthCare Company's Audit Committee meeting on October 18,
2001, the members of the Audit Committee approved the
appointment of BDO Seidman LLP as the new independent
accountants, subject to the completion of certain client
acceptance procedures by BDO Seidman, LLP. On November 14, 2001,
EarthCare Company completed the engagement of BDO Seidman, LLP
as their new independent accountants by signing an engagement
letter with BDO Seidman, LLP.


ENRON CORP: Reaffirms Commitment to Proposed Merger with Dynergy
----------------------------------------------------------------
Enron Corp. (NYSE: ENE) announced that it has closed on the
remaining $450 million of a previously announced $1 billion in
secured credit lines from JP Morgan, the investment-banking arm
of JP Morgan Chase & Co., and Salomon Smith Barney, the
investment-banking arm of Citigroup Inc.  The $450 million
credit facility is secured by the assets of Enron's Northern
Natural Gas Company.  A $550 million credit facility, secured by
the assets of Enron's Transwestern Pipeline Company, closed on
Nov. 16. Proceeds are being used to supplement short-term
liquidity and to refinance maturing obligations.

Enron also reaffirmed its commitment to the merger with Dynegy
Inc. "We continue to believe that this merger is in the best
interests of our shareholders, employees, and lenders," said
Kenneth L. Lay, chairman and CEO of Enron.  "It offers the
opportunity to create a formidable player in the merchant energy
business with substantial growth prospects and a strong
financial position."

Enron also announced that it is in active discussions with its
primary lenders on a restructuring of its debt obligations to
further enhance liquidity.  "We have been in continuous contact
with our banks and believe we can identify a mutually beneficial
restructuring to enhance our cash position, strengthen our
balance sheet and address upcoming maturities," said Jeffrey
McMahon, executive vice president and chief financial officer of
Enron.  "For example, we have been informed by the lead bank on
the facility that the maturity on our $690 million note payable
obligation, disclosed on

Nov. 19 in a Form 10-Q filed with the Securities and Exchange
Commission, will be extended to mid-December, providing the time
necessary to restructure the facility.  We expect that extension
to be formalized shortly."

"We believe the interests of Chase and Enron's other primary
lenders are aligned in this restructuring effort," said James B.
Lee, vice chairman of JP Morgan Chase & Co.  "We will work with
Enron and its other primary lenders to develop a plan to
strengthen Enron's financial position up to and through its
merger with Dynegy."

Enron is one of the world's leading energy, commodities and
services companies. The company markets electricity and natural
gas, delivers energy and other physical commodities, and
provides financial and risk management services to customers
around the world. Enron's Internet address is
http://www.enron.com

The stock is traded under the ticker symbol "ENE."


ETOYS INC: Wants Exclusive Period Extended to January 16
--------------------------------------------------------
EBC I Inc, formerly known as eToys, Inc. asks the Delaware
Bankruptcy Court to further extend its Exclusive Periods.
The Debtor wants the Exclusive Periods to file Plan and solicit
consents for the Plan be extended through January 16, 2002 and
March 17, 2002, respectively.

eToys, Inc. now known as EBC I Inc, is a web-based toy retailer
based in Los Angeles, California. The Company filed for Chapter
11 Petition on March 7, 2001 in the U.S. Bankruptcy Court for
the District of Delaware. Robert J. Dehney, at Morris, Nichols,
Arsht & Tunnell and Howard Steinberg at Irell & Manella
represents the Debtors in their restructuring efforts. When the
company filed for protection from its creditors, it listed
$416,932,000 in assets and $285,018,000 in debt.


EXODUS COMMS: Seeks Okay to Assume Senior Executive Agreements
--------------------------------------------------------------
Exodus Communications, Inc., and its debtor-affiliates seek
authority to assume executive employment agreements with L.
William Krause, William Austin and Richard Stoltz.

The Debtors seek to assume the Executive Employment Agreements
as part of a comprehensive program designed by the Debtors to
minimize management and other key employee turnover by providing
incentives for employees, including senior management, to remain
in the Debtors' employ and to work toward a successful
reorganization of the Debtors' estates. The proposed assumption
of the Executive Employment Agreements is a necessary element of
the Key Employee Programs defined and described in the Employee
Retention Program Motion.

Mark S. Chehi, Esq., at Skadden Arps Slate Meagher & Flom LLP in
Wilmington, Delaware, informs the Court that the Debtors'
executives subject to this Motion are parties to Executive
Employment Agreements governing the terms of their respective
employments. Although each contract contains different terms
based upon the position and responsibility of each executive,
the Executive Employment Agreements all contain provisions
setting forth base pay, incentive award opportunities, equity
compensation, relocation assistance, health and welfare benefits
and severance benefits. The Debtors request that executives with
Executive Employment Agreements be entitled to receive the
greater of the severance benefits available under the employee
retention program or the severance benefits available under the
Executive Employment Agreements.

Mr. Chehi states that the Debtors, in consultation with
executive compensation consultants, reviewed the proposed terms
of the Executive Employment Agreements and believe such terms
are within industry standards and consistent with employment
contracts assumed in other large corporate restructurings, both
in and out of chapter. In particular, the Debtors believe that:

A. the salaries contained in the Executive Employment Agreements
    are within the range of competitive practice;

B. the amounts of the proposed bonuses, severance and other
    benefits contained within the Executive Employment
    Agreements are within the range of competitive practice;
    and

C. the Executive Employment Agreements contain terms and
    conditions comparable to those provided to members of
    senior management with similar positions and experience in
    technology and similar industries, and in other large
    chapter 11 cases.

The Debtors believe that prompt assumption of the Executive
Employment Agreements is necessary to quell fears among the
Debtors' top management that the Debtors will not honor their
agreements as the Debtors navigate through the reorganization
process. Without assumption of these agreements, the Debtors
believe that, a number of their key executives may leave their
positions for alternative, more secure employment or, at best,
will be distracted from focusing all of their energies on the
very formidable reorganization tasks that lie ahead. In either
case, Mr. Chehi submits that the Debtors and their estates will
suffer and the prospects for a successful reorganization will be
dimmed.

Mr. Chehi contends that it is especially critical that the
Executive Employment Agreements be assumed in order to offset
the inability of the Debtors to offer stock-based compensation
programs during the pendency of their chapter 11 cases, as well
as to further enhance the Debtors' ability to retain key
executives. Prior to the Petition Date, stock options and other
equity rights formed the most significant portion of total
compensation typically paid to top management. The Debtors
therefore believe that prompt assumption of the Executive
Employment Agreements is essential if the Debtors are to retain
their top executives during this period of uncertainty, and are
to remain competitive with other potential employers.

Mr. Chehi tells the Court that losing any of the top management
would severely harm the Debtors in many ways, including:

A. many of the executives have significant experience with, and
    a unique and extensive knowledge of, the Debtors' business
    that would be difficult to replace at any cost.

B. such executives are difficult to replace because experienced
    job candidates often find the prospect of working for a
    chapter 11 company unattractive.

C. to find suitable replacement senior management, the Debtors
    may have to pay substantial fees to executive search firms,
    as well as signing bonuses, reimbursement for relocation
    expenses and above-market salaries to induce qualified
    candidates to accept employment with a chapter 11 debtor.

D. the loss of any member of top management could lead to
    additional executive departures.

The Debtors have determined in the exercise of their business
judgment that assumption of the Executive Employment Agreements
is necessary in order to provide incentives for key management
to remain on the job until the Debtors' reorganization process
is complete. Mr. Chehi asserts that the assumption of their
contracts will send a strong signal to them that their services
are valued, their compensation awards are competitive, and the
Debtors have stabilized their operations and have confidence in
the ultimate success of the reorganization process. (Exodus
Bankruptcy News, Issue No. 7; Bankruptcy Creditors' Service,
Inc., 609/392-0900)


FEDERAL-MOGUL: Taps R.R. Donnelley as Noticing Agent
----------------------------------------------------
The hundreds of thousands of claimants and other parties in
interest involved in the chapter 11 cases of Federal-Mogul
Corporation and its debtor-affiliates may impose heavy
administrative and other burdens on this Court and the Office of
the Clerk of the Court. The most effective manner to relieve the
Clerk's Office of the burdens of these cases is to engage an
independent third party to act as a notice agent of the Court.

By this motion, the Debtors files an application to employ and
retain R.R. Donnelley & Sons Company as notice agent of the
Bankruptcy Court.

James J. Zamoyski, Esq., the Debtors' Senior Vice President and
General Counsel, tells the Court that Donnelley is one of the
country's leading commercial printers with expertise in
distribution. Mr. Zamoyski believes that the Debtors' estates
will benefit from Donnelley's significant experience as notice
agent if the Court approves the appointment of Donnelley in
these cases. Mr. Zamoyski certifies that Donnelley is fully
equipped to handle the volume involved in properly sending the
required notices to creditors and other interested parties in
these chapter 11 cases.

Donnelley will provide various services as notice agent,
including:

A. preparing and serving all notices required under any
    applicable Bankruptcy Rule, including:

     1. notice of commencement of these chapter 11 cases and the
        initial meeting of creditors;

     2. notice of any hearings on a disclosure statement and
        confirmation of a plan of reorganization;

     3. other miscellaneous notices to entities, as the Debtors
        or Court may deem necessary and proper for an orderly
        administration of these chapter 11 cases.

B. after mailing of a particular notice, filing with the Clerk's
    Office a certificate or affidavit of service, within 10 days
    after each service, that includes a copy of the notice, list
    of persons to whom it was mailed and the date mailed;

C. assisting the Debtors with the preparation and mailing of
    ballots for the purpose of voting to accept or reject any
    plan of reorganization proposed by the Debtors in these
    chapter 11 cases.

D. complying with applicable federal statutes, ordinances,
    rules, regulations, orders, and other requirements;

E. promptly complying with such other further conditions and
    requirements as the Clerk's Office or the Court may
    hereafter prescribe.

Donnelley will be compensated in these cases according to the
quantity of pieces prepared and served and the amount of
information included in those pieces, such as:

       Quantity          50,000     150,000     200,000
       Printing Cost    $ 4,364     $ 7,846     $ 9,028
       Mail Cost          4,620      10,175      13,200
       Envelope Cost      2,084       4,187       5,164
       Set-up Cost          250         250         250
       Total Cost        11,318      22,458      27,642
       Unit Cost        $   .23     $   .15     $   .14

In connection with its appointment as notice agent to the
Debtors in these cases:

A. Donnelley will not consider itself employed by any federal or
    state agency and will not seek any compensation from the
    government in its capacity as the notice agent in these
    chapter 11 cases.

B. By accepting employment in these cases, Donnelley waives any
    right to receive compensation from the Government.

C. In its capacity as the notice agent in these cases, Donnelley
    will not be an agent of the United States and will not act
    on behalf of the United States.

D. Donnelley will not employ any past or present employee of the
    Debtors in connection with its work as notice agent for
    these cases.

Carmel A. Sardone, President of R.R. Donnelley & Sons Company,
believes that Donnelley is a disinterested person in these cases
and does not hold or represent interest adverse to the Debtors'
estates for matters which Donnelley is to be employed. Ms.
Sardone relates that the firm has performed and may continue to
perform certain financial printing services for the Debtors in
matters unrelated to which Donnelley is to be engaged in.

Ms. Sardone certifies that Donnelley nor any of its officer or
employees has any connection with the Debtor and their
creditors, and other parties in interests that would conflict
with the scope of Donnelley's retention or create interest
adverse to the Debtors' estates or any other parties in
interest. (Federal-Mogul Bankruptcy News, Issue No. 5;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


FOCAL COMMUNICATIONS: Fitch Junks Senior Notes and Bank Facility
----------------------------------------------------------------
Fitch has downgraded Focal Communications' (Focal) senior
secured rating to 'CCC+' from 'B' and senior unsecured rating to
'CCC-' from 'CCC+'.

Focal's ratings are also removed from Rating Watch Negative. The
Rating Outlook is Negative.

The downgrades reflect the worse-than-expected improvement in
revenues in 2002, limited financial flexibility as the company
must continue to successfully target enterprise customers,
manage its data business churn and working capital position in
order to remain fully funded.

The Negative Rating Outlook incorporates the impact the soft
economy will continue to have on the company's revenues and
strained capital structure.

Revenues are lower-than-expected in 2002 due to higher- than-
expected Internet Service Provider (ISP) disconnects coupled
with the impact of a softer economy, worsened by the events of
Sept. 11. Fitch expects network and carrier settlement expenses
to improve as a percentage of revenue; therefore, EBITDA will be
moderately impacted by the reduction in revenue. The company has
very limited access to capital as its only source are the funds
available under its credit facility ($55 million through year-
end 2002 and $95 million thereafter). Positively, during the
restructuring and recapitalization, Focal was able to loosen the
bank facility covenants to provide it with operating
flexibility.

Moreover, Fitch continues to be concerned with the company's
ability to grow its telecom-related revenue to the level
necessary to remain fully funded as Fitch expect further
weakening in its data segment in 2002. Management is dedicating
more resources to target enterprise customers in 2002. Although
this is a significant opportunity for the company, as it needs
to only capture minimal market share to breakeven in a market,
it must rapidly reach the necessary level of sales productivity
to remain funded. As of Sept. 30, 2001, its mature markets
generated an EBITDA margin of 35.1%, excluding corporate
overhead expenses and restructuring costs. The remaining 16
(new) markets produced EBITDA of negative $1.2 million,
approaching breakeven.

Prior to the restructuring, Focal's accounts receivable days
outstanding lengthened and its payable days shortened, which was
a further drain on cash. The company expects its cash operating
cycle to improve as its restructuring affords it increased
leverage with customers and suppliers/vendors. However,
liquidity would be hampered if the company is unable to improve
its working capital position.

The company recently closed a recapitalization transaction,
which resulted in a $150 million capital infusion. This
consisted of $50 million of convertible preferred stock and a
$100 million secured convertible note, ranking subordinate to
the bank debt. Both securities are convertible into common
shares and will accrue 8% paid-in-kind (PIK) payments. This
recapitalization allowed Focal to decrease its debt outstanding
by approximately 50%.

Focal is the only competitive local exchange carrier (CLEC) that
solely targets large business customers, generating robust
revenue per salesperson. In addition, Focal has successfully
managed to decrease its exposure to reciprocal compensation,
increasing its corporate and value-added reseller (VAR) customer
base. Fitch expects Focal's telecom customer revenue to account
for all of its future revenue growth, compared to Fitch's
previous estimate of 70%.


FRUIT OF THE LOOM: Judge Walsh Rejects $30MM Termination Fee
------------------------------------------------------------
"I can't believe" Berkshire is entitled to a $30 million
termination fee, Judge Peter J. Walsh exclaimed Wednesday as he
struck-down bidding procedures crafted to test Berkshire
Hathaway's $835 million bid to purchase substantially all of
Fruit of the Loom's assets under a plan of reorganization.
Judge Walsh opines that that the $30 million termination fee
could have a coercive effect on creditors when asked to vote for
or against Fruit of the Loom's chapter 11 plan that would
transfer ownership of the company to Berkshire.

DDJ Capital Management, LLC, Lehman Brothers, Inc., and Mariner
Investments, Inc. -- holders of the Company's 8-7/8% Senior
Notes -- balked at the $30 million termination fee guaranteed to
Berkshire if it lost in bidding for Fruit of the Loom's assets.
The Bidding Procedures the Debtors and Berkshire propose, Bruce
Bennett, Esq., at Hennigan, Bennett & Dorman, charges, are "not
only an attempt to predetermine the terms of a plan but even
more importantly, improperly influence[] the voting and
confirmation process."

Luc A. Despins, Esq., at Milbank, Tweed, Hadley & McCloy, argued
in vain Wednesday morning that the bidding procedures are fair,
reasonable and the best means to ensure that Fruit of the Loom
obtains the highest and best offer for the Business.   Mr.
Despins reminded Judge Walsh that the Termination Fee is one of
the material inducements that brings Berkshire's $835 million
bid to the table.  Mr. Despins told Judge Walsh that the other
final round bidders in the Marketing Process orchestrated by
Lazard Freres & Co., LLC, Fruit of the Loom's financial
advisors, in conjunction with Chilmark Partners, the financial
advisors to Bank Steering Committee and with Houlihan Lokey
Howard & Zukin, each requested a termination fee in an
equivalent range, in amounts ranging up to $32,500,000
(including expense reimbursement).

"Bidding incentives encourage a potential purchaser to invest
the requisite time, money and effort to negotiate with Fruit of
the Loom and perform the necessary due diligence attendant to
the acquisition of Fruit of the Loom's assets, despite the
inherent risks and uncertainties of the chapter 11 process," Mr.
Despins continued.

Historically, Mr. Despins argued, bankruptcy courts have
approved bidding incentives similar to the Termination Fee and
Bidding Procedures under the "business judgment rule," which
forwns on judicial second-guessing of the actions of a
corporation's board of directors taken in good faith and in
the exercise of honest judgment, directing Judge Walsh's
attention to In re 995 Fifth Ave. Assocs., L.P., 96 B.R. 24, 28
(Bankr. S.D.N.Y. 1989) (bidding incentives may "be legitimately
necessary to convince a white knight to enter the bidding by
providing some form of compensation for the risks it is
undertaking").  More recently, Mr. Despins added, the Third
Circuit established standards for determining the
appropriateness of bidding incentives in the bankruptcy context.
Specifically, in Calpine Corp. v. O'Brien Envtl. Energy, Inc.,
181 F.3d 527 (3d Cir. 1999), the court held that even though
bidding incentives are measured 38 against a business judgment
standard in nonbankruptcy transactions, the administrative
expense provisions of Bankruptcy Code section 503(b) govern
in the bankruptcy context.  Accordingly, to be approved, bidding
incentives must provide some benefit to Fruit of the Looms'
estates. See id. at 533.  The O'Brien court identified at least
two instances in which bidding incentives may provide benefit to
the estate. First, benefit may be found if "assurance of a
break-up fee promoted more competitive bidding, such as
by inducing a bid that otherwise would not have been made and
without which bidding would have been limited." Id. at 537.
Second, where the availability of bidding incentives induces a
bidder to research the value of Fruit of the Loom and submit a
bid that serves as a minimum or floor bid on which other bidders
can rely, "the bidder may have provided a benefit to the estate
by increasing the likelihood that the price at which [Fruit of
the Loom] is sold will reflect its true worth." Id.

So, Mr. Despins explained, whether evaluated under the "business
judgment rule" or the Third Circuit's "administrative expense"
standard, the Bidding Procedures and Termination Fee pass muster
because:

       (a) the Agreement and the Bidding Procedures, including
           the Termination Fee, are the product of extended good
           faith, arm's-length negotiations between Fruit of the
           Loom and Berkshire;

       (b) the Bidding Procedures and Termination are fair and
           reasonable in amount, and are reasonably intended to
           compensate for Berkshire's risk of being used as a
           "stalking horse"; and

       (c) the Termination Fee and Bidding Procedures already
           have encouraged competitive bidding, in that Berkshire
           wouldn't have entered into the Agreement without these
           provisions.

The Termination Fee and Bidding Procedures thus have "induc[ed]
a bid that otherwise would not have been made and without which
bidding would [be] limited."  O'Brien, 181 F.3d at 537.
Similarly, Berkshire's offer, provides a minimum bid on which
other bidders can rely, thereby "increasing the likelihood that
the price at which the [Business will be] sold will reflect
its true worth."  Id.

Au contraire, Mr. Bennett responded.  The facts in FTL's case
don't follow the O'Brien decision.  Berkshire has already done
its due diligence.  The Debtors provide no evidence that a
Termination Fee is necessary to induce other bidders to make
offers.  In fact, the Debtors picked tapped Berkshire as the
stalking horse bidder from three offers on the table.  The only
purpose the Termination Fee serves is to chill bidding.

DDJ, Lehman and Mariner make no secret about why they're upset.
They are convinced that FTL is worth more reorganized than
liquidated.  The Three Bondholders remind the Court that, early
on in these cases, the Debtors stipulated that the value of the
Company's assets were $1.45 billion.  That stipulation paved the
way for the Secured Parties were oversecured.  Throughout these
cases, the Debtors have said over and over that the business is
improving.  How, then, the Bondholders wonder aloud, has FTL
concluded that a sale of substantially all of the assets for
$835 million (subject, Berkshire says to its shareholders in
announcing its third quarter results, to "significant
reductions") is a better deal for creditors?

Mr. Despins declined to address valuation-related arguments,
suggesting that confirmation is the appropriate time for
dissident creditors to put expert testimony and other evidence
before the Court to challenge confirmability of a plan under 11
U.S.C. Sec. 1129(a)(7).  Taking a final crack at the bat to
explain why the Termination Fee is appropriate in FTL's case,
Mr. Despins argued that the mere existence of the Bidding
Procedures and Termination Fee permits Fruit of the Loom to
insist that competing bids for the Business be materially higher
or otherwise better than the Agreement, and that provides a
clear benefit to Fruit of the Loom's estates.  In sum, Mr.
Despins continued, Fruit of the Loom's ability to offer the
Bidding Procedures and the Termination Fee enables the Debtors
to ensure the sale of the Business to a contractually-committed
bidder at a price the Board of Directors (and core creditor
constituencies) believe to be fair while, at the same time,
providing them with the potential of even greater benefit to the
estates. Thus, the Bidding Procedures and Termination Fee should
be approved.

Judge Walsh refused to budge.  Judge Walsh sees that creditors,
if inclined to reject the plan, would be faced with the prospect
of "throwing away $30 million."  That puts too much pressure on
creditors to vote to accept a deal they really don't like, so
the Termination Fee provision won't be approved, Judge Walsh
ruled.

It is unclear to what extent Judge Walsh's blow from the bench
unravels the Berkshire deal.  In the course of the hearing, and
in conversations with reporters afterward, professionals
representing Fruit of the Loom, Berkshire Hathaway, the
Unofficial Secured Bank Steering Committee, the Steering
Committee of the Informal Committee of Senior Secured
Noteholders, and the Official Committee of Unsecured Creditors
declined to speculate what the next step might be.  Company
officials at FTL and Berkshire headquarters were equally tight-
lipped.  By its own terms, the Berkshire deal provides that if
acceptable bidding procedures aren't in place by Nov. 30,
Berkshire walks.  But, if Warren E. Buffet is committed to "the
strength of the [Fruit of the Loom] brand and the managerial
talent of John Holland," as he indicated when the deal was
announced on Nov. 1, Berkshire has the option to waive the
Termination Fee provision and proceed without the guarantee of
the $30 million consolation prize.


GENESIS WORLDWIDE: Walter W. Stasik Appointed as New CEO
--------------------------------------------------------
Genesis Worldwide II, Inc. announced that it has hired Walter W.
Stasik as its new Chief Executive Officer. Stasik has over 30
years of capital equipment experience, most recently with Voest-
Alpine Industries in Pittsburgh, where he was the Vice President
for Special Projects. Stasik previously served as the Chief
Operating Officer of the Danieli Corporation from 1993 to 2000,
and before that was the Chief Financial Officer of Wean Inc.
from 1986 to 1993.

Genesis Worldwide II, Inc. was created by KPS Special Situations
Fund, L.P. and Pegasus Partners II, L.P. to purchase the
domestic businesses and assets of Genesis Worldwide, Inc. and
its subsidiaries in connection with a section 363 asset sale in
the Genesis Worldwide, Inc. chapter 11 bankruptcy proceeding. On
November 14, 2001, U.S. Bankruptcy Court Judge Thomas Waldron
approved the sale to Genesis Worldwide II, Inc. The transaction
is expected to close in the next weeks.

Following the closing of the transaction, Genesis Worldwide II,
Inc. will engineer high-quality metal coil processing, roll
coating and electrostatic oiling equipment in the United States
primarily through its Herr-Voss, Stamco and Gencoat business
units. The company also will provide mill roll reconditioning,
texturing and grinding services in addition to its rebuilding,
repairing and spare parts business.


HEAFNER TIRE: S&P Lowers Ratings a Notch on Poor Performance
------------------------------------------------------------
Standard & Poor's lowered its corporate credit and bank loan
ratings on Heafner Tire Group to single-'B'-minus from single-
'B', and its senior unsecured rating to triple-'C'-plus from
single-'B'-minus. In addition, the ratings were placed on
CreditWatch with negative implications.

Total debt as of Sept. 29, 2001, was about $288 million.

The rating actions reflect Heafner's weaker-than-expected
operating results, high debt leverage, constrained liquidity,
and Standard & Poor's concerns that financial measures will
remain below expected levels for the near to intermediate term.

Heafner is a leading independent supplier of passenger car and
light truck tires to the domestic replacement tire market. The
company's weak operating results have been caused by reduced
demand for consumer and commercial replacement tires and high
expense levels. Demand has declined due to the soft U.S.
economy. In addition, the Firestone tire recall during 2000 led
to the early replacement of some consumer tires, which has
depressed demand in 2001.

Ford Motor Company's 2001 recall of certain Firestone tires is
not benefiting Heafner because the replacement tires are being
shipped directly to Ford's dealers, bypassing the wholesale
distribution channel. For the first nine months of 2001,
industry shipments of replacement passenger and light truck
tires declined 3%. The events of Sept. 11 have also led to
weaker demand; Heafner's business remains 10% below the level
prior to Sept. 11. Lower demand has resulted in a more
competitive environment and heightened pricing pressures. Market
conditions are expected to remain weak in the near term.

Heafner's expenses have increased during the past year due to
several acquisitions completed during fiscal 2000. Although the
company reduced costs during the third quarter by closing
facilities and reducing its workforce, Heafner's expenses are
largely fixed, limiting its ability to adjust to sales declines.
Heafner has also taken charges related to doubtful accounts,
inventory write downs, facility closures, and employee
severance.

Despite a 6.5% increase in sales, Heafner's EBITDA (excluding
special charges) declined 27% for the first nine months of 2001.
Credit protection measures are weak, with total debt to EBITDA
of about 9 times and EBITDA interest coverage of about 1x.
Although the company's lenders recently agreed to revise
Heafner's bank financial covenants, future covenant requirements
remain restrictive. Liquidity is constrained, with only $18
million available under a revolving credit facility.

Standard & Poor's will review Heafner's recent operating
performance and assess the prospects and likely time frame for
achieving operating improvements. If it appears that financial
performance will fall below expected levels, operating
improvements will be substantially delayed, or liquidity will
become more constrained, the ratings could be lowered.


HOUSE2HOME INC: Commences Inventory Liquidation Process
-------------------------------------------------------
House2Home, Inc., announced financial results for the third
fiscal quarter and nine-month period, ended October 27, 2001. On
November 7, the company and its subsidiaries filed voluntary
petitions under Chapter 11 of the Federal Bankruptcy Code in the
U.S. Bankruptcy Court in Santa Ana, California. The company is
in the process of liquidating all 42 of its House2Home home
decorating superstores and will cease normal business operations
over the next three to four months.

The company reported a net loss for the fiscal third quarter of
$20.6 million. For the prior year period, the company reported a
net loss of $10.3 million. Sales for the company's 42 House2Home
stores totaled $119.4 million for the quarter. Sales totaled
$334 million for the third quarter a year ago when the company
operated 84 HomeBase stores and five House2Home test stores.

For the nine-month period, the company reported a net loss of
$187.9 million. The company reported a net loss of $10 million
for the corresponding prior year period. Sales for the current
nine-month period were $530.4 million. Net sales for the
corresponding prior year period were $1.1 billion, including
sales at both HomeBase and House2Home stores.

As previously reported, sales for the company's House2Home
stores fell severely following the September 11 terrorist
attacks, exacerbating an already difficult retail environment.
In addition, the company was approaching its peak borrowing
levels against its credit facility following the August
completion of the store conversion program. These factors, in
combination, led to extreme pressure on the company's cash
position. Despite intense efforts, no other strategic
alternatives materialized that would permit the company to avoid
liquidation.

Upon receiving Bankruptcy Court approval, inventory liquidation
sales began on November 14 at all 42 House2Home stores. The
inventory liquidation process is being conducted by a joint
venture, led by Gordon Brothers Retail Partners, LLC, and is
expected to take approximately 13 weeks to complete. The company
also reported that it has reached an agreement with the major
constituencies in the bankruptcy case, and, subsequently, has
received Bankruptcy Court approval, to honor outstanding pre-
petition House2Home gift certificates, gift cards and credit
vouchers. All House2Home stores are now accepting these forms of
store credit. In addition, a committee representing the
company's unsecured creditors has been established. The company
is also developing a process for the orderly disposition of its
owned and leased properties. Based on information currently
available, the company does not believe there will be equity
value remaining after proceeds from the liquidation of
inventory, real estate and other assets are used to repay
secured and unsecured creditors.

Headquartered in Irvine, California, House2Home, Inc. has 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, visit the House2Home Web site at
http://www.house2home.com


JAM JOE: Court Extends Lease Decision Deadline to January 31
------------------------------------------------------------
The United States bankruptcy Court for the District of Delaware
approved Jam Joe LLC's motion to extend the time to assume or
reject unexpired leases of nonresidential real property.

The deadline set by the Bankruptcy Court now runs through
January 31, 2002.

Jam Joe LLC filed for Chapter 11 Petition in the U.S. Bankruptcy
Court for the District of Delaware on July 23, 2001. Christopher
S. Sontchi, Esq., at Ashby & Geddes represents the Debtors in
their restructuring efforts.


KELLSTROM: Faces Nasdaq Delisting Due To Form 10-Q Filing Delay
---------------------------------------------------------------
Kellstrom Industries, Inc. (Nasdaq: KELL), announced it received
a Nasdaq Staff Determination on November 19, 2001 that its
common stock is subject to delisting from The Nasdaq National
Market, pending the outcome of the hearing.

The delisting determination was based on the failure of
Kellstrom to file its Form 10-Q for the quarter ended September
30, 2001 as required under Nasdaq Marketplace Rule 4310c(14).
Kellstrom intends to request an oral hearing before the Nasdaq
Listing Qualifications Panel to review the Staff Determination
and seek continued listing. When Nasdaq receives the hearing
request, the delisting of the common stock will be automatically
stayed pending the outcome of the hearing. As a result of
Kellstrom's failure to file the Form 10-Q, the trading symbol
for its common stock will be changed from "KELL" to "KELLE" at
the opening of business on November 21, 2001. The common stock
will continue to trade on The Nasdaq National Market pending the
outcome of these proceedings.

There can be no assurance the Panel will grant Kellstrom's
request for continued listing. Due to uncertainties relating to
the impact of the terrorist attacks against the United States on
September 11, 2001, which exacerbated the weak market conditions
existing in the commercial aviation market and specifically in
the commercial aviation aftermarket parts industry, Kellstrom is
unable to determine when it will be in a position to file the
quarterly report for such period. If Kellstrom is delisted from
The Nasdaq National Market, it will seek to have its shares
traded on an alternative trading venue, although there can be no
assurance that an alternative trading venue will be available.

Kellstrom is a leading aviation inventory management company.
Its principal business is the purchasing, overhauling (through
subcontractors), reselling and leasing of aircraft parts,
aircraft engines and engine parts. Headquartered in Miramar, FL,
Kellstrom specializes in providing: engines and engine parts for
large turbo fan engines manufactured by CFM International,
General Electric, Pratt & Whitney and Rolls Royce; aircraft
parts and turbojet engines and engine parts for large transport
aircraft and helicopters; and aircraft components including
flight data recorders, electrical and mechanical equipment and
radar and navigation equipment.


KEYSTONE: Prolonged Industry Slump Causes Strain on Liquidity
-------------------------------------------------------------
Keystone Consolidated Industries, Inc. (NYSE: KES), an
integrated wire and wire products producer, announced its
results for the third quarter and nine months ended September
30, 2001.  For the 2001 third quarter, Keystone reported a net
loss of $1.3 million compared to a net loss in the 2000 third
quarter of $3.1 million.  For the nine-month period ended
September 30, 2001, Keystone reported a net loss of $6.6 million
compared to a net loss of $8.4 million in the first nine months
of 2000.

Net sales of $82.3 million in the 2001 third quarter were down
$500,000 from $82.8 million during the same period during 2000.
This decline in net sales was due primarily to a 9% decline in
overall per-ton steel and wire product selling prices partially
offset by a 10% increase in shipments of Keystone's steel and
wire products.  Carbon steel rod shipments increased 44% during
the 2001 third quarter compared with the 2000 third quarter,
while per- ton selling prices declined .5%.  Industrial wire
shipments declined 26% while selling prices declined 6% and
fabricated wire products shipments declined 7% while selling
prices declined 2%.

Billet production during the 2001 third quarter declined to
190,000 tons from 196,000 tons during the third quarter of 2000.
Rod production during the 2001 third quarter declined to 174,000
tons from 185,000 tons during the 2000 third quarter.

Gross profit during the 2001 third quarter increased to $6.6
million from $3.9 million in the 2000 third quarter.  This
increase in gross profit was due primarily to lower costs for
utilities and scrap steel, Keystone's primary raw material,
lower rod conversion costs due to improved production
efficiencies and a favorable $1.7 million settlement with a
utility provider in connection with litigation over a 1999 fuel-
adjustment surcharge billed to the Company by the utility, all
partially offset by the lower overall per-ton selling price of
the Company's steel and wire products.

Selling expense was $1.5 million in the third quarter of both
2001 and 2000.

General and administrative expense increased to $4.7 million
during the third quarter of 2001 as compared to $4.4 million
during the third quarter of 2000 primarily due to higher legal
and professional costs partially offset by the impact of
reductions in salaried headcount resulting from employees
accepting Keystone's early retirement package during the fourth
quarter of 2000.

Keystone currently anticipates the total 2001 overfunded defined
benefit pension credit will approximate $3.0 million.

Interest expense in the third quarter of 2001 was lower than the
third quarter of 2000 due principally to lower interest rates
and lower borrowing levels.

                     Nine-Month Review

Net sales of $246.4 million in the first nine months of 2001
were down 10% from $274.6 million during the same period during
2000.  This decline in net sales was due primarily to a 5%
decline in shipments of Keystone's steel and wire products
combined with a 7% decline in overall steel and wire product
selling prices partially offset by a $1.4 million increase in
Garden Zone's sales during the first nine months of 2001.
Carbon steel rod shipments during the first nine months of 2001
increased 14% as compared to the first nine months of 2000 while
per-ton selling prices declined 3%.  Industrial wire shipments
declined 26% while per-ton selling prices declined 5%.
Fabricated wire products shipments during the first nine months
of 2001 declined 11% as compared to the first nine months of
2000 while per-ton selling prices declined 2%.

Billet production during the first nine months of 2001 increased
to 542,000 tons from 529,000 tons during the first nine months
of 2000.  The primary reason for the higher production levels
during the first nine months of 2001 was the abnormally low
production levels during the 2000 second quarter due to extended
outages incurred in connection with the correction of the
infrastructure problems related to Keystone's capital
improvements that were completed during 1998 and a "break-out"
that occurred at the Company's electric arc furnace during June
2000.  Keystone did not purchase any billets during the first
nine months of 2001 as compared to 8,000 tons purchased during
the first nine months of 2000.  Despite increased rod production
during the second quarter of 2001 as compared to the 2000 second
quarter, lower rod production during the first and third
quarters of 2001 resulted in a decline in rod production during
the first nine months of 2001 to 509,000 tons from 533,000 tons
during the first nine months of 2000.  The decline was due
primarily to intentional production curtailments during the
first quarter of 2001 designed to avoid using high cost natural
gas and to allow billet inventories to build in anticipation of
planned outages for repair and maintenance projects in the steel
mill during that quarter.

Gross profit during the first nine months of 2001 declined to
$13.9 million from $14.3 million in the first nine months of
2000 although the Company's gross margin increased from 5.2% in
the 2000 period to 5.6% in the first nine months of 2001.  This
decrease in gross profit was due primarily to the lower overall
per-ton selling price of the Company's steel and wire products
and higher natural gas costs, partially offset by lower costs
for scrap steel and purchased billets, $1.6 million of business
interruption insurance proceeds received in the 2001 first
quarter related to incidents in prior years and the $1.7 million
utility settlement received in the 2001 third quarter.  In
addition, the adverse impact on gross profit from production
outages amounted to approximately $800,000 during the first nine
months of 2001 and $5.3 million in the first nine months of
2000.  The lower per-ton selling price of the Company's steel
and wire products during the first nine months of 2001 adversely
impacted gross profit by $17.5 million while the effect of
higher natural gas costs adversely impacted gross profit by
$3.0 million.

Selling expense during the first nine months of 2001 of $4.8
million was, approximately $200,000 lower than the same period
in 2000, but was as a percentage of sales, comparable with
selling expense in the same period in 2000.

General and administrative expense declined from $13.7 million
during the first nine months of 2000 to $12.5 million during the
first nine months of 2001, primarily due to the reduction in
salaried headcount and a $650,000 reimbursement of legal fees
received in 2001, partially offset by an unfavorable legal
settlement and the higher legal and professional costs.

Interest expense during the first nine months of 2001 was lower
than the same period in 2000 due principally to lower interest
rates and lower borrowing levels.

                Outlook for the Remainder of 2001

Carbon steel rod imports continue to cause disruption in the
marketplace and market demand has weakened.  As a result,
management believes Keystone will record a net loss during the
fourth quarter of 2001 and will record a net loss for calendar
2001 due primarily to higher energy and interest costs,
continued high levels of imported rod and relative lower overall
product selling prices.

At September 30, 2001, the Company has recognized a net deferred
tax asset of $32.5 million.  The Company periodically reviews
the recoverability of its deferred tax assets to determine
whether such assets meet the "more-likely- than-not" recognition
criteria.  At September 30, 2001, based on all available
evidence, the Company concluded no deferred tax asset valuation
allowance was needed.  The Company will continue to review the
recoverability of its deferred tax assets, and based on such
periodic reviews, the Company could recognize a valuation
allowance related to its deferred tax assets in the future.

Although operating results improved in the 2001 third quarter
improved over that of the 2000 third quarter due to improved
operating efficiencies, medical cost sharing arrangements and
other initiatives, the prolonged downturn in the steel industry
continues to adversely effect Keystone's liquidity and capital
resources.  In response, the Company has been required to defer
capital expenditures, defer maintenance expenditures and delay
payments to vendors and other creditors to the extent possible.
Despite these measures, the Company's availability under its
primary revolving credit facility is limited ($4 million at
November 15, 2001 after consideration of outstanding payments to
creditors) and a significant portion of the Company's accounts
payable are past due compared to stated terms.  As a result of
the above factors, on August 1, 2001, Keystone did not make a
$4.8 million interest payment due on its Senior Secured Notes.

Under the governing indenture, a failure to make a scheduled
interest payment for thirty days gives the holders of the Notes
the right to accelerate the unpaid portion of the Notes.  Such a
failure also gives the trustee for the Notes the ability to take
certain actions and to exercise certain remedies on behalf of
holders of the Notes.  The Company has received consents from
holders representing more than 75% of the principal amount of
the Notes in which the noteholders agreed to defer exercising
their right to accelerate the payment of the Notes pursuant to
the acceleration provisions of the governing indenture until
December 7, 2001, and agreed to not direct the trustee of the
Notes through such date to take any action or exercise any
remedy available to the trustee as a result of the Company's
failure to make the interest payment. Keystone continues to
evaluate possible restructuring alternatives to improve its
overall financial condition, including the potential conversion
of the Notes into equity securities of the Company.  In this
regard, Keystone has entered into discussions with financial
advisors to assist the Company in the process of evaluating
restructuring alternatives.  Keystone has received an agreement
from its primary revolving credit lender to forbear remedies
available to it solely as a result of the Company's failure to
make the August 1, 2001 interest payment on the Notes.


LTV CORP: Cleveland-Cliffs Assessing Impact of Shut-Down Plan
-------------------------------------------------------------
Cleveland-Cliffs Inc (NYSE: CLF) said that it is assessing the
impact of LTV Corporation's (OTC Bulletin Board: LTVCQ)
announcement that it plans to cease its integrated steel
operations. LTV is a customer of Cliffs and is a 25 percent
owner of the Cliffs-managed Empire Mine.

Cliffs' pellet sales in the fourth quarter, which had been
projected to be in the range of 3.3 to 3.5 million tons, are now
projected to be about 2.6 million tons. This will result in
expected full year sales of approximately 8.3 million tons.
Cliffs has no trade accounts receivable exposure to LTV.

As a result of LTV's actions, the Empire Mine will idle
operations for an indefinite period.  The Empire Mine is owned
by subsidiaries of Ispat Inland Inc. (40%), LTV Corporation
(25%) and Cliffs (35%).

Cleveland-Cliffs is the largest supplier of iron ore products to
the North American steel industry and is developing a
significant ferrous metallics business. Subsidiaries of the
Company manage and hold equity interests in five iron ore mines
in Michigan, Minnesota and Eastern Canada. Cliffs has a major
iron ore reserve position in the United States and is a
substantial iron ore merchant. References in this news release
to "Cliffs" and "Company" include subsidiaries and affiliates as
appropriate in the context.


LODGIAN: S&P Further Cuts Junk Ratings & Maintains Watch
--------------------------------------------------------
Standard & Poor's lowered its ratings for Lodgian Inc. and
Lodgian Financing Corp. All ratings remain on CreditWatch with
negative implications.

The downgrade follows the announcement that the company is
currently not in compliance with its senior credit facility and
reflects management's expectations that it will not meet its
December 31 amortization payment on its senior secured credit
facility and its January 15, 2002, interest payment on its $200
million subordinated notes due 2009. Although management has
reached a forbearance agreement in principle with its lenders
until December 31, the outcome of its negotiations is still
uncertain. If amortization and interest payments are not made,
the issue ratings will be lowered to 'D' following each payment
date.

Based in Atlanta, Georgia, Lodgian owns or manages a portfolio
of 106 hotels with approximately 20,000 rooms in 32 states and
Canada. They are primarily full-service hotels.

Ratings remain on CreditWatch as Standard & Poor's monitors the
progress of Lodgian's negotiations with lenders.

         Ratings Lowered, Remaining On Creditwatch Negative

                                         TO        FROM
      Lodgian Inc.

        Corporate credit rating          CC        CCC+

      Lodgian Financing Corp.

        Senior secured bank loans*       CC        CCC+
        Subordinated notes*              C         CCC-
         (*Guaranteed by Lodgian Inc.)


LOEWEN GROUP: Deems CTA-Related Fees 'Unrealistically High'
-----------------------------------------------------------
The Loewen Group, Inc., and its debtor-affiliates do not object
to the reimbursing fees and expenses of any of the Principal CTA
Creditors or the Indenture Trustees.  However, the Debtors
believe that many of the estimated fee and expense amounts may
be unrealistically high given the current posture of these
chapter 11 cases.  Accordingly, Loewen has filed a provisional
objection to the estimated fee and expense amounts submitted by
the CTA Creditors and the Indenture Trustees in order to
preserve the Company's right to review and, if necessary, object
to the fees and expenses actually incurred through the Effective
Date.

Principal CTA Creditor  Total Amt.  Incurred Amt. Estimated Amt.
or Indenture Trustee    Asserted    Asserted      Asserted
----------------------  ----------  ------------- --------------
Oaktree Capital
Management LLC          $1,110,205    $  827,705     $282,500

Angelo Gordon & Co.
Franklin Mutual
Advisors, LLP           $  833,616    $  778,616     $ 55,000

Cerberus Capital
Management              $  217,566    $  199,066     $ 18,500

GSCP Recovery, Inc.     $  391,684    $  376,684     $ 15,000

Bank of Montreal        $2,461,184    $2,134,716     $326,468

Wachovia Bank, N.A.     $1,716,144    $1,216,144     $500,000

HSBC Bank U.S.A.        $  804,049    $  654,049     $150,000

U.S. Bank National
Association             $1,182,983    $  915,483     $267,500

Trust Company of
Bank of Montreal        $1,845,729    $1,590,729     $255,000

Bank One Trust
Company, N.A.           $2,175,621    $1,425,621     $750,000

Wells Fargo Bank, N.A.  $  353,479    $  348,479     $  5,000

Teachers Insurance
and Annuity
Association of America  $   95,810    $   70,810     $ 25,000

The UST objects to any allowance for the fees and expenses of
State Street's agents and attorneys based on the argument that,
because the Indentures "provide for State Street's continued
rights to compensation and reimbursement of fees and expenses
including, but not limited to, all fees and expenses of State
Street's agents and attorneys," State Street is entitled to
collect such fees and expenses from the Debtors under section
503(b)(1) of the Bankruptcy Code. The UST is not sure if State
Street is making such argument. To the extent State Street is,
the UST believes it should be rejected. The UST points out that
sections 503(b)(3)(D) and 503(b)(5) of the Bankruptcy Code
incorporate the "substantial contribution" standard with respect
to such matter. The UST notes that State Street does not
describe any act on its part which would constitute a
"substantial contribution" under Lebron; the mere fact that the
indenture trustee served note holders under the indenture does
not satisfy the Lebron test. (Loewen Bankruptcy News, Issue No.
49; Bankruptcy Creditors' Service, Inc., 609/392-0900)


MATTRESS DISCOUNTERS: Likely Default Spurs S&P to Junk Ratings
--------------------------------------------------------------
Standard & Poor's lowered its corporate credit and senior
unsecured debt ratings on Mattress Discounters Corp. to double-
'C' from triple-'C' and lowered its senior secured bank loan
rating to triple-'C'-minus from triple-'C'-plus. The outlook is
negative.

The downgrade is based on the company's limited liquidity and
heightened risk of payment default. Mattress Discounters' credit
facility is fully drawn and the company had about $5.2 million
in cash on hand as of September 29, 2001, which is only expected
to fund operations and cover interest payments in the near term.

Moreover, Mattress Discounters generated only $2 million of
EBITDA in the first nine months of 2001, but is required to make
an approximately $9 million interest payment on its senior notes
in January 2002. Because of these factors, the company needs to
obtain additional sources of capital to fund operations and debt
service. In addition, Mattress Discounters is not currently in
compliance with revised financial covenants on its senior credit
facility and anticipates that it will not be in compliance for
the remainder of 2001.

Operating performance has deteriorated due to significant and
prolonged comparable-store sales declines throughout the
company's markets. In addition, operating difficulties are
occurring at a time when a softening in the economy is
contributing to an overall industry slowdown.

Upper Marlboro, Maryland-based Mattress Discounters is a bedding
retailer in 15 markets in the U.S. The company sells both Sealy
manufactured bedding products and its own private-label Comfort
Source products.

                        Outlook: Negative

If Mattress Discounters is unable to generate positive cash
flow, amend its financial covenants, and arrange for alternative
financing, the ratings could be lowered.


METALS USA: Gets Okay to Use Existing Cash Management Systems
-------------------------------------------------------------
Metals USA, Inc., and its debtor-affiliates maintain two
centralized cash management systems -- one for Metals USA Inc.,
and one for Metals Receivables Corp. These cash management
systems have been in place since July 2001.  Debtors' cash
management system is integrated with the revolving credit
arrangements provided by Bank of America N.A., as administrative
agent for a group of institutional lenders under the Loan and
Security Agreement dated March 12, 2001 as amended and restated.

Cash receipts form collections of receivables from Metals USA's
customers are received in lock-box accounts maintained at Bank
of America, PNC Bank and at Bank One Texas, N.A. This cash is
forwarded on a daily basis from these lock-box accounts to
master depository accounts for the benefit of Bank of America,
where this cash partially repays the outstanding balance of
revolving loans made by Bank Group. When Bank of America lends
money to Metals USA, these proceeds go to the Metals USA Master
Disbursement/Operating Accounts which in turn fund 28 Metals USA
Accounts Payable Accounts, 19 Metals USA Payroll Accounts, 12
Metals USA Clearing Accounts and 5 Metals USA Management
Accounts. Checks and automatic fund transfers are paid to
vendors and employees on a daily basis out of these payment
accounts. The Debtors routinely deposit and withdraw funds from
these accounts primarily through a custom electronic cash
transfer system, by methods including check, wire transfer and
automated clearing house transfer.

By this motion, the Debtors sought and obtained entry of an
interim order:

     A. authorizing the Debtors' immediate continued use of their
        existing bank accounts, cash management system, checks
        and business forms; and

     B. scheduling a final hearing on this motion on November 28,
        2001.

Zack A. Clement, Esq., at Fulbright & Jaworski LLP in Houston,
Texas, submits that a waiver of requiring the Debtors to close
all pre-petition accounts and open new debtor-in-possession
accounts is appropriate in these cases. The Debtors' cash
management system provides an efficient and secure means of
managing and disbursing cash for the Debtors' daily operations
on a daily basis. Mr. Clement claims that closing of each of the
bank accounts and opening new accounts will substantially
disrupt the Debtors' business operations and cash management
system and hinder the smooth operation of the Debtors'
businesses during the critical initial stages of these cases.

Mr. Clement believes that commencement of these cases will place
a substantial strain on the Debtors' relationships with their
employees, vendors, and customers, each of which are essential
to the Debtors' continued operations. The delays, confusion and
disruption that will result if the Debtors are required to
substitute new debtor-in-possession accounts will further strain
these relationships. In addition, the Debtors' centralized cash
management system is beneficial to the Debtors, their estates
and creditors because it enables the Debtors to reduce the
administrative expenses involved in moving funds and to maintain
accurate information regarding receipts, account balances and
disbursements.

In an effort to ensure that pre-petition checks are not honored
absent an order of the Court, Mr. Clement assures the Court that
the Debtors will serve a copy of this motion and the proposed
form of order on all affected banks within 2 business days of
the filing of this motion with the Court. The Debtors will also
serve upon such banks a copy of any pleadings filed by the
Debtors on the petition date seeking to honor  pre-petition
checks and will provide each bank with a list of check numbers,
so that checks numbered lower these can be presumed to be pre-
petition and thus not paid.

Mr. Clement relates that the Debtors issue a large number of
checks in the ordinary course of business and it may be
impractical to obtain sufficient "Debtor-in-Possession" check
stock during the initial stages of these cases. As existing
check stock is depleted while the Debtors are operating in
chapter 11, the Debtors will obtain new check stock reflecting
their status as debtor-in-possession and listing the case number
under which these cases are being jointly administered. The
Debtors also utilize numerous standard business forms, including
invoices, purchase orders, form contracts and bills of lading.
As existing sock of pre-printed business forms is depleted while
the Debtors are operating under chapter 11, Mr. Clement says
that the Debtors will obtain new business forms reflecting their
status as debtor-in-possession and listing the case number under
which these cases are being jointly administered.

Judge Greendyke directs the Debtors to close all dormant and
unnecessary accounts and to change the signature cards on all
open accounts to reflect debtor-in-possession status and shall
open all post-petition accounts and debtor-in-possession
accounts.  He further orders the Debtors to immediately commence
a new series of check numbers and that the Debtors, counsel for
the Bank Group and the U.S. Trustee's Office shall use their
best efforts to resolve any objections to the entry of a final
order on the motion. (Metals USA Bankruptcy News, Issue No. 2;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


NATIONSRENT: S&P Junks Ratings & Expects Bankruptcy Filing
----------------------------------------------------------
Standard & Poor's lowered its ratings for NationsRent Inc. At
the same time, all the ratings were placed on CreditWatch with
negative implications. A $790 million credit facility and $175
million of rated long-term debt securities are affected.

The rating actions follow the announcement that the company does
not expect to make its $53.7 million principal payment on its
term loan portion of its credit facility due December 1, 2001.
Liquidity is very constrained with the company having less than
$20 million of availability under its revolving credit facility
as of September 30, 2001. NationsRent has suffered from poor
operating performance due to the weak economy, slower than
expected rental revenue growth, and ongoing operational issues
at several of its branches.  The company is considering various
options to address its capital structure, including a possible
bankruptcy filing.

The ratings will be lowered to 'D' should the company fail to
make its term loan payment or file for bankruptcy. Standard &
Poor's will monitor developments as they unfold.

           Ratings Lowered, Placed On Creditwatch Negative

      NationsRent Inc.                    TO      FROM

        Corporate credit rating           CC      B
        Bank loan                         CC      B
        Subordinated debt                 CC      CCC+


NETIA HOLDINGS: S&P Junks Ratings Over Higher Credit Risk Level
---------------------------------------------------------------
Following the recent announcement by Poland-based
telecommunications operator Netia Holdings S.A. that it has
launched a tender offer and consent solicitation for 85% of its
outstanding senior unsecured notes, Standard & Poor's lowered
its long-term corporate credit rating on Netia to double-'C'
from single-'B'-minus. At the same time, Standard & Poor's
lowered its senior unsecured debt ratings on guaranteed
subsidiaries Netia Holdings B.V. and Netia Holdings II B.V. to
single-'C' from triple-'C'. All ratings remain on CreditWatch,
where they were placed with negative implications on August
8, 2001.

The rating actions reflect the higher degree of risk for
creditors in view of the proposed cash offer for Netia's bonds.
Under the terms of the proposal, bondholders are being offered
between 11% and 14% of the nominal value for 85% of the
outstanding bonds in a modified Dutch auction. The overall
tender is contingent on the receipt of tender offers for a
minimum of 65% of the total outstanding notes and at least 50%
of each issue.

Netia is also seeking consent to remove or modify certain
negative covenants. If investors tender their bonds prior to
November 23, 2001, they will receive an additional 1% payment of
nominal value of the notes, bringing the total to between 12%
and 15% of nominal value. The combined nominal value of all the
notes in question is about EUR957 million ($856 million).

In addition, Netia has stated that it will not pay interest due
Dec. 15, 2001, on its EUR100 million 13.5% notes and $100
million 13.125% notes due in 2009, and that the tender price for
the EUR200 million 13.75% notes due in 2010 is inclusive of the
interest payment due Dec. 15, 2001. At this stage, it is unclear
as to the date and amount of interest that will be paid to
holders of the euro 2009 and U.S. dollar 2009 notes who do not
take up the offer. There is also a need to assess the
ramifications of a weakened covenant package pertaining to the
bonds that could remain outstanding in Netia's capital structure
after the offer is completed.

Netia intends to fund this buyback with existing cash and cash
equivalent of Polish zloty (PLZ) 643 million ($151 million) and
restricted cash of PLZ7 million at September 30, 2001. Standard
& Poor's estimates that the proposed buyback could cost up to
about $102 million. At this stage, it is uncertain if
bondholders of the required 65% of the notes will accept the
tender offer.

While successful completion of the offer would significantly
reduce Netia's debt burden, it would leave the company with
insufficient cash to continue operations beyond the first
quarter of 2001, based on the current cash burn rate of about
$25 million in the third quarter of 2001.

If the offer proves successful, Netia will have a less leveraged
balance sheet, although the company's financial flexibility will
remain constrained without the provision of extra funds. To
date, Netia's shareholders have not declared whether they will
provide additional funding for the company to continue
operations. Standard & Poor's would need to review Netia's
revised medium-term business plan in the light of a successful
completion of the tender offer.

Standard & Poor's views Netia's proposed offer as coercive, as
refusal to accept the offer may lead to even worse prospects for
bondholders. Completion of the offer would be treated as a
default with regard to the notes due in 2009, at which time the
corporate credit rating would be lowered to 'SD' (selective
default) and the ratings on the euro 2009 and U.S. dollar 2009
senior unsecured notes lowered to 'D'.


NETZEE: Sells Digital Visions to SS&C Tech. For $1.35MM + Debts
---------------------------------------------------------------
Netzee, Inc. (Nasdaq: NETZ), a leading provider of integrated
Internet banking products and services and Internet commerce
solutions, announced that it has sold its Digital Visions assets
to SS&C Technologies (Nasdaq: SSNC) for gross proceeds of
approximately $1.35 million in cash and the assumption of
certain liabilities.

These assets provided Internet-based financial information tools
for community banks and credit unions, delivered bond
accounting, interest rate analytic and asset liability services,
as well as information services designed to help retail and
small business lending officers.

"Over the past year, we have tightened our focus on the Internet
banking services offered by Netzee," said Donny R. Jackson,
Netzee president and chief executive officer.  "These assets no
longer fit into our core product offering.  We intend to use
proceeds from the sale to pay down debt and further strengthen
our financial position as we move Netzee towards a positive
EBITDA and cash flow position in the year 2002."

Netzee provides financial institutions with a suite of Internet-
based products and services, including full-service Internet
banking, bill payment, cash management, Internet commerce
services, custom web design and hosting, branded portal design,
access to brokerage services, as well as implementation and
marketing services.  Netzee was formed in 1999 as a subsidiary
of The InterCept Group, Inc. (Nasdaq: - ICPT), and as the
successor to a company founded in 1996.  Netzee became a public
company in November 1999.  The company's stock is traded on the
Nasdaq National Market under the symbol NETZ. Further
information about Netzee is available at http://www.netzee.com

                          *  *  *

Netzee's working capital deficit as of September 30, 2001 was
approximately $1.0 million compared to a working capital deficit
of $5.5 million at December 31, 2000. This increase in working
capital is primarily due to proceeds from the sale of the
company's regulatory reporting assets and certain bill payment
assets, offset by its operating and capital requirements as well
as the classification of its redeemable preferred stock as a
current liability. The company calculate its working capital
balances by taking its current assets net of current liabilities
plus borrowings available on our credit facility.


OWENS CORNING: Seeks to Defend & Indemnify Employee Defendants
----------------------------------------------------------------
Owens Corning and its debtor-affiliates seek authority to
indemnify their directors and officers for defense costs
incurred in connection with the Existing Litigation and/or Other
Litigation through March 29, 2002, to a maximum expenditure of
$600,000, without prejudice to the right of the Debtors to
request an increase of this amount and/or a modification of the
proposed time period.

J. Kate Stickles, Esq., at Saul Ewing LLP in Wilmington,
Delaware, tells the Court that certain present and past
directors and officers of the Debtors have been named as
defendants in a purported securities class action based upon
certain specified officers' and directors' alleged conduct with
respect to alleged misleading statements of fact and omissions
of material fact in connection with certain Registration
Statements filed with the Securities and Exchange Commission.
Separately, certain officers and/or directors of the Debtors
have been named in the Buchfield Litigation, which asserts what
are primarily employment liability claims arising out of the
plaintiffs' alleged plans to assume positions with
ServiceLane.com, an entity to which the Debtors contributed
assets pursuant to Court Order dated December 1, 2000. Ms.
Stickles points out that the allegations against the directors
and officers named in the Securities Litigation and the
Burchfield Litigation include conduct for which the Debtors'
directors and officers are entitled to indemnification pursuant
to the Debtors' Certificate of Incorporation and bylaws as well
as Delaware law.

Ms. Stickles informs the Court that the Debtors and their
present and former directors and officers are insured by Chubb
Group of Insurance Companies under a Directors and Officers
Liability Insurance Policy, which provides $20,000,000 in
coverage for claims made against the Debtors and their directors
and officers during the policy period of March 29, 2001 to March
29, 2002. In addition to the Chubb Policy, the Debtors and their
directors and officers are insured under a number of excess
directors and officers' liability insurance policies that
generally follow the terms and conditions of the Chubb Policy,
which additionally provides for $180,000,000 in coverage for
claims.

Ms. Stickles relates that the combined Chubb and the Excess
Policies afford the Debtors and their directors and officers
$200,000,000 in coverage for claims like those alleged in the
Existing Litigation. The D&O Policies currently in force were
renewed on March 29, 2001 in accordance with a materially
identical endorsement on the prior year's Chubb policy and total
premiums paid for the D&O Policies currently in force was
$1,488,340, the same amount paid for the prior year's policies.
Ms. Stickles explains that the Chubb Policy has a $1,000,000 per
claim retention for losses as to which the Debtors are legally
permitted to indemnify its directors and officers. If
indemnification is not legally permissible, or if the Debtors
are unable to indemnify their Directors and Officers solely
because of the Debtors' financial insolvency, the retention
amount is zero.

Ms. Stickles states that the directors and officers named in the
Securities Litigation have informed the Debtors that they intend
to defend themselves and have retained the Dechert law firm as
their defense counsel. It is the Debtors' understanding that
said firm will be entering an appearance in the Securities
Litigation and filing a responsive pleading on or before March
29, 2002, the Expiration Date of the D&O Policies. Although the
Burchfield Litigation was filed only very recently, the Debtors
expect their officers and directors named therein to retain
counsel to defend themselves. Significantly, Ms. Stickles
believes that the payment by Chubb of any defense costs or other
amounts in connection with the Existing Litigation, or in
connection with any other litigation or matter, prior to March
29, 2002, would jeopardize the Debtors' ability to renew the D&O
Policies automatically for, as stated above, aggregate annual
premiums of $1,488,340.

If the Debtors lose their contractual right to renew the D&O
Policies automatically, Ms. Stickles fears that the additional
costs of replacing the policies in March 2002 are expected to
include an overall premium increase of more than $1,000,000 to
purchase renewal coverage to take effect on March 29, 2002, and
payment of more than $1,000,000 to incumbent carriers to secure
"Discovery Period" coverage. Moreover, if the current D&O
Policies are not renewed on March 29, 2002, the Debtors would
likely purchase from the incumbent carriers so-called "Discovery
Period" protection, which provides them coverage under the
current D&O Policies for wrongful acts that occurred prior to
March 29, 2002, but that do not give rise to claims for one or
two years thereafter. The premium cost of this coverage would
exceed $1,000,000 and be payable above and beyond the additional
$1,000,000.

Thus, Ms. Stickles concludes that the additional costs of
securing the Discovery Period coverage and the additional
premiums to replace the D&O Policies, if they are not
automatically renewed, would be at least $2,000,000 more than
the aggregate premium of $1,480,000 million for the D&O
Policies, if they are automatically renewed. Separate and apart
from these anticipated costs, the Debtors may not be able to
secure $200,000,000 of equivalent replacement coverage if they
lose the benefit of the Guarantee Renewal Endorsement. Due to
the hardening of the directors and officers insurance market
prior to September 11, 2001 and the disruptions in the entire
insurance industry since September 11, 2001, Ms. Stickles claims
that there are serious market issues which call into question
the Debtors' ability to obtain equivalent replacement coverage.
It goes without saying that the maintenance of adequate
directors and officers coverage is critical to the Debtors'
ability to retain and attract highly qualified directors and
officers. More fundamentally, Ms. Stickles asserts that adequate
directors and officers coverage protects the Debtors' estates
from indemnity claims on account of post-petition actions of the
Debtors' officers and directors.

The Debtors believe it is in the best interest of the estates
and creditors for the Debtors to be authorized to indemnify
their directors and officers with respect to costs incurred in
connection with the Existing Litigation, as well as in
connection with any other litigation which may be filed based on
acts alleged to have occurred prior to the Petition Date or
arising prior to the Petition Date, in the manner, and subject
to the restrictions, outlined below. Such authority, if granted,
would permit the Debtors to realize savings of more than
$2,000,000 and would ensure their ability to maintain adequate
directors and officers insurance.

In order to provide the Court and creditors with comfort
regarding the relief requested, Ms. Stickles points out that the
proposed form of order restricts the Debtors' authority to
indemnify their directors and officers to defense expenses
incurred prior to March 29, 2002 in connection with the Existing
Litigation, and/or in connection with any Other Litigation, in
the maximum amount of $600,000, without prejudice to the right
of the Debtors to request an increase of these amounts and/or a
modification of the proposed time period, upon further notice
and an opportunity for a hearing. Based on the Debtors'
discussions with counsel to the directors and officers named in
the Securities Litigation, and upon the Debtors' understanding
of the Burchfield Litigation, $600,000 should be sufficient to
satisfy defense expenditures incurred in the Existing Litigation
and in the Other Litigation, if any, in the time period prior to
March 29, 2002. (Owens Corning Bankruptcy News, Issue No. 22;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


PILLOWTEX: Wants Plan Filing Exclusivity Extended to March 15
-------------------------------------------------------------
Pillowtex Corporation seek an order:

     (i) extending the period during which the Debtors have the
         exclusive right to file a plan or plans of
         reorganization by approximately 4 months, through and
         including March 15, 2001; and

    (ii) extending the period during which the Debtors have the
         exclusive right to solicit acceptances thereof through
         and including May 15, 2002.

The Debtors have made substantial progress in their
reorganization efforts, William H. Sudell, Jr., Esq., at Morris,
Nichols, Arsht & Tunnell, in Wilmington, Delaware, tells the
Court.  Most significantly, Mr. Sudell relates, the Debtors
completed their comprehensive 3-year strategic business plan,
which serves as the foundation for their reorganization efforts.
The Debtors have also completed the sale of substantially all of
the assets of their unprofitable blanket division and have
continued to implement identified cost reduction and asset
rationalization initiatives, Mr. Sudell adds.

Moreover, Mr. Sudell cites the size and complexity of the
Debtors' chapter 11 cases as justification for the requested
extension.  Mr. Sudell reminds the Court that "the Debtors and
their nondebtor affiliates comprise a large, complex and
geographically diverse organization that is one of the largest
North American designers, manufacturers and marketers of home
textile products."  Mr. Sudell further notes that the extension
of the exclusive periods is rendered more compelling by the fact
that the Debtors are now at the stage where they are negotiating
with the Secured Lenders and the Creditors' Committee regarding
the principal terms of a plan of reorganization.

Finally, Mr. Sudell assures the Court, the extension of the
exclusive periods will not harm the Debtors' creditors or other
parties in interest.  Neither the Debtors' creditors nor any
other party in interest would be in a position to formulate,
build a consensus around and obtain confirmation of a plan of
reorganization prior to the end of the extension of the
exclusive periods, Mr. Sudell claims.  Accordingly, Mr. Sudell
contends, the relief the Debtors are requesting will not delay
the plan-of-reorganization process.  Rather, Mr. Sudell says, it
will simply permit the process to move forward in an orderly
fashion.

By application of Del.Bankr.LR 9006-2, the current deadline is
automatically extended through the conclusion of the
December 18, 2001 hearing. (Pillowtex Bankruptcy News, Issue
No. 17; Bankruptcy Creditors' Service, Inc., 609/392-0900)


PINNACLE HOLDINGS: S&P Junks Ratings Citing Liquidity Concerns
--------------------------------------------------------------
Standard & Poor's lowered its ratings on independent tower
operator Pinnacle Holdings Inc. and subsidiary Pinnacle Tower
Inc. The ratings remain on CreditWatch with negative
implications.

The downgrade is based on Standard & Poor's heightened concerns
about the company's liquidity, in light of its announcement that
it is not in compliance with financial covenants under its bank
facility. The company is negotiating with the bank group to
obtain waivers and amendments to the bank covenants, though it
is uncertain whether Pinnacle will be successful in these
efforts. Absent receipt of this agreement in the near term, the
ratings will be lowered further.

The bank loan rating is the same as the corporate credit rating,
reflecting the uncertainty that exists as to whether the
company's tower portfolio would provide full recovery of the
fully drawn bank facility in a distressed scenario, based on the
value ascribed to the company's assets, including its portfolio
of nearly 2,500 owned revenue-producing towers.

Pinnacle Holdings' business position is very weak relative to
other tower operators. Unlike the other major independent tower
players, it does not have any anchor tenant contracts with large
national or regional wireless telephony carriers. As such, it
has been relatively more dependent on the financially fragile
paging and wireless data sector, which comprises 30% of the
company's revenues. During the third quarter of 2001, the
company's revenue base was adversely affected by the bankruptcy
and rescission of leases by two paging companies, and a lease
default by a third paging carrier. Gross tenant additions were
likewise soft for the quarter.

These factors, coupled with higher expenses for tower rents and
utilities, and increased headcount for managing the tower
portfolio, constrained the company's operating cash flows for
the third quarter and limit cash flow improvement prospects. The
company's asset impairment charge of $250 million for the
reevaluation of its tower portfolio has no immediate impact on
its credit quality, since Standard & Poor's had already valued
Pinnacle's tower assets at a discount to book value.

The company has targeted sales of non-core assets to improve its
liquidity and has pending agreements for the sale of several
collocation facilities for about $22 million. Pinnacle is also
seeking buyers for two other collocation facilities, as well as
for its U.K. tower investment and various domestic land parcels.
Under the amended bank agreement being negotiated, proceeds from
the pending sale of the collocation properties would be used
to pay bank amortization requirements, including about $7
million in bank amortization due in December 2001.

Moreover, 80% of prospective asset sales proceeds would be used
to pay off additional outstanding bank borrowings. Total bank
debt outstanding as of Sept. 30, 2001, was roughly $383 million.
Cash balances of only about $13 million provide limited
liquidity in light of the company's ongoing maintenance capital
expenditure requirements and interest payments, and limited
expectations for operating cash flow.

The investigation of the company's public accounting firm by the
SEC continues to create uncertainty as to whether Pinnacle will
be required to restate its financial reporting, and effectively
eliminated the company's ability to access the public capital
markets over the past year. With the recent weakening of the
overall economy and financial markets, the company's ability to
obtain additional funding remains extremely limited.

                   Ratings Lowered and Remaining
                      on Creditwatch Negative

      Pinnacle Holdings Inc.                    TO          FROM
        Corporate credit rating                 CCC+        B-
        Senior unsecured debt                   CCC-        CCC

      Pinnacle Towers Inc.
        $285 million secured revolving credit*  CCC+        B-
        $125 million secured term loan*         CCC+        B-
        $110 million secured term loan*         CCC+        B-
           *Guaranteed by Pinnacle Holdings Inc.


PRECISION AUTO: Net Loss Narrows to $1.9MM in September Quarter
---------------------------------------------------------------
Precision Auto Care, Inc. (Nasdaq: PACI) announced a loss of
$1.9 million for the fiscal quarter ending September 30, 2001,
compared with a loss of $2.7 million for the comparable prior
year quarter.

Lou Brown, President and CEO, stated "Even though the bottom
line is not where we want to it to be, I am pleased that the
Company showed improvement from the comparable period a year
ago. I believe that we are headed in the right direction and
that the operating results will continue to improve in both our
franchise business and our manufacturing and distribution
business." Robert Falconi, PACI CFO, stated, "The Company is
especially happy over the results in the manufacturing and
distribution division. A year ago, that division was losing a
great deal of money. This year, it is off to a good start. We
believe that we are beginning to see the dividends from the
consolidation of our car wash plant, Hydro-Spray, and our
modular building plant, Precision Building Solutions, in
Mansfield, Ohio."

Precision Auto Care, Inc. is the world's largest franchisor of
auto care centers, with over 500 operating centers as of
November 21, 2001.  The Company franchises and operates
Precision Tune Auto Care centers around the world, and offers a
vertically integrated organization with manufacturing and
distribution subsidiaries.

According to Troubled Company Reporter - October 4 Edition, is
currently negotiating extensions of Senior Debt. However, the
report said, in the event that the Company would be unable to
accomplish its strategic objectives or would be otherwise unable
to generate revenues sufficient to cover operating expenses and
pay other debt, the Company would not be able to sustain
operations at the current level. This would require the Company
to further reduce expenses and liquidate certain assets.


RELIANCE GROUP: Hires LeBoeuf Lamb as Special Tax Counsel
---------------------------------------------------------
Pursuant to the motion to employ ordinary course professionals,
Reliance Group Holdings, Inc. asks Judge Gonzalez for permission
to employ the law firm of LeBoeuf, Lamb, Greene & MacRae as
special tax counsel.  LeBoeuf maintains offices at 125 West 55th
Street in New York City, 10019.

John S. Breckinridge, Jr., Esq., files an affidavit in support
of his firm's retention.  Since 1954, LeBoeuf and predecessor
firms have represented the Debtors' insurance subsidiaries, and
indirectly the Debtors, in connection with income tax matters,
including income tax returns filed on a consolidated basis with
the Internal Revenue Service.  LeBoeuf has also helped RGH file
separate franchise tax returns with the State of New York and
certain other taxing jurisdictions in New York.

If it is retained as special counsel, Mr. Breckinridge states
that LeBoeuf expects to continue its representations of the
Debtors in the matters described above, except to the extent
that a conflict arises among the entities that were parties to
the Debtors' consolidated tax returns.

Mr. Breckinridge continues, although LeBoeuf represents no
parties adverse to RGH itself, LeBoeuf has clients and potential
clients, which are adverse to the interests of the Debtors'
insurance subsidiaries in the Pennsylvania liquidation
proceedings and other pending litigation.  Those representations
and potential representations do not involve tax issues, and
LeBoeuf intends to continue them.  In addition, because
LeBoeuf's prior tax work was on behalf of the entities that
participated in the Debtors' consolidated tax returns, including
the insurance subsidiaries, LeBoeuf cannot undertake to
represent the Debtors in any tax dispute that may arise between
the Debtors and the insurance subsidiaries, including, without
limitation, disputes concerning tax allocations, allocation of
tax refunds and allocation of tax losses.

LeBoeuf intends to apply for compensation for professional
services rendered at its customary hourly rates and for
reimbursement of expenses.  Mr. Breckinridge states that he is
the principal attorney designated to represent the Debtors and
his current hourly rate is $425.  He informs Judge Gonzalez that
other attorneys and paralegals may work on matters for RGH from
time to time.  He also states that in his opinion, LeBoeuf meets
the legal definition of a disinterested party.

In the retention questionnaire attached to the filing, it is
disclosed that Lee D. Hoffman, Esq., an associate attorney in
LeBoeuf's office in Hartford, Connecticut, owns 50 shares of RGH
common stock. (Reliance Bankruptcy News, Issue No. 15;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


SERVICE MERCHANDISE: Delays 10-Q Filing for September Quarter
-------------------------------------------------------------
Service Merchandise Company, Inc. was unable to file timely its
quarterly report on Form 10-Q for the quarter ended September
30, 2001 because it believes that there are circumstances and
events which may affect materially the information contained in
the 10-Q and which cannot be described in a complete and
accurate manner at this time without unreasonable effort or
expense. The 10-Q will be filed on or before the fifth calendar
day following the prescribed due date.

On March 15, 1999, five of the Company's vendors filed an
involuntary petition for reorganization under Chapter 11 of the
Bankruptcy Code in the United States Bankruptcy Court for the
Middle District of Tennessee seeking court supervision of the
Company's restructuring efforts. On March 27, 1999, the Debtors
filed voluntary petitions with the Bankruptcy Court for
reorganization under Chapter 11 and orders for relief were
entered by the Bankruptcy Court. The Chapter 11 Cases have been
consolidated for the purpose of joint administration
under Case No. 399-02649. The Debtors are currently operating
their businesses as debtors-in-possession pursuant to the
Bankruptcy Code.

The Company's Consolidated Statements of Operations included
below have been prepared without notes and are unaudited. They
have been prepared on a going concern basis, which contemplates
continuity of operations, realization of assets and liquidation
of liabilities and commitments in the normal course of business.
The Company's recent losses and the Chapter 11 Cases raise
substantial doubt about the Company's ability to continue as a
going concern.

                      Results Of Operations

Net sales for the Company were $178.9 million for the three
periods ended September 30, 2001 compared to $274.3 million for
the three periods ended October 1, 2000. The Company believes
the decline in net sales was primarily due to the increased
restructuring and remerchandising activities in fiscal 2000,
cross shop loss from exiting certain home product categories and
a weak economic environment.

Net sales from operations excluding exiting categories and
closed facilities were $178.9 million for the three periods
ended September 30, 2001 compared to $225.4 million for the
three periods ended October 1, 2000. Comparable store sales for
jewelry were down 16.3% and home products comparable store sales
were down 28.0% compared to the three periods ended October 1,
2000.  The jewelry comparable stores sales decrease was led by
declines in special events, watches/accessories and
diamonds/stones. The home products comparable store sales
performance was driven by declines in personal care, photo, and
housewares.

There were no net sales from exiting categories and closed
facilities for the three periods ended September 30, 2001
compared to $48.9 million for the three periods ended October 1,
2000. Sales from exiting categories and closed facilities
decreased due to the fact that the three periods ended October
1, 2000 reflects the sales of discontinued product lines that
were substantially completed by December 31, 2000.

Gross margin was $36.3 million for the three periods ended
September 30, 2001 as compared to $46.0 million for the three
periods ended October 1, 2000. The decrease in gross margin was
primarily due to a decrease in sales.

Gross margin after costs and expenses and excluding exiting
categories and closed facilities was $36.3 million or 20.3% of
net sales for the three periods ended September 30, 2001,
compared to $58.0 million or 25.7% of net sales for the three
periods ended October 1, 2000. The margin decrease was primarily
due to a decrease in sales with approximately the same occupancy
costs as the prior year.

There was no gross loss after costs and expenses for exiting
categories and closed facilities for the three periods ended
September 30, 2001 compared to (negative) $12.1 million for the
three periods ended October 1, 2000. The margin increase was
primarily due to the fact that the three periods ended October
1, 2000 reflects the sales of discontinued product lines that
were substantially completed by December 31, 2000.

Net sales for the Company were $636.6 million for the first nine
periods of 2001 compared to $1,034.9 million for the first nine
periods of 2000. The Company believes the decline in net sales
was primarily due to the increased restructuring and
remerchandising activities in fiscal 2000, cross shop loss from
exiting of certain home product categories and a weak economic
environment.

Net sales from operations excluding exiting categories and
closed facilities were $636.6 million for the first nine periods
of 2001 compared to $842.9 million for the first nine periods of
2000. Comparable store sales for jewelry were down 15.9% and
comparable store sales for home products was down 24.1% as
compared to the first nine periods of 2000. The jewelry
comparable store sales decrease was driven by declines in
special events, watches/accessories and diamond/stones. The home
products comparable sales decrease was driven by declines in
personal care, photo and housewares. The Company believes that
the decline in net sales was primarily due to cross shop loss
from exiting of certain home product categories and a weak
economic environment.

Net sales from exiting categories and closed facilities were
$0.05 million for the first nine periods of 2001 compared to
$192.0 million for the first nine periods of 2000. Sales from
exiting categories and closed facilities decreased primarily due
to the fact that the first nine periods of 2000 reflects the
sales of discontinued product lines that were primarily
completed by December 31, 2000 and were not reflected in the
first nine periods of 2001.

Gross margin was $166.5 million for the first nine periods of
2001 compared to $214.4 million in the first nine periods of
2000. The decrease was primarily due to a $398.3 million decline
in sales, partially offset by a $350.3 million decrease in cost
of goods sold.

Gross margin after costs and expenses and excluding exiting
categories and closed facilities was $167.0 million or 26.2% of
net sales for the first nine periods of 2001, compared to $234.0
million or 27.8% of net sales for the first nine periods of
2000. The margin decrease was primarily due to decreased sales.

Gross loss after costs and expenses for exiting categories and
closed facilities was a loss of $0.4 million, compared to a loss
of $19.6 million for the first nine periods of 2000. The margin
increase was primarily a result of decreased inventory clearance
sales for the first nine periods of 2001.


SUNSHINE PCS: Ernst & Young Doubts Ability to Continue
------------------------------------------------------
Sunshine PCS Corporation has incurred losses since inception and
will need to obtain capital for further build-out of facilities.
There can be no assurance that Sunshine can raise  sufficient
capital to finance the construction of its networks.
Accordingly there is substantial doubt about Sunshine's ability
to continue as a going concern.

Sunshine was incorporated in July 2000, as the successor to
Fortunet Communications, L.P., a  combination of five
partnerships that were awarded 31 personal communications
service licenses in the Federal Communications Commission's 1996
C-Block auction.  These licenses had an aggregate purchase price
of $216 million after a 25% bidding credit, and were financed
primarily by the Federal Communications Commission.   Fortunet
Communications, L.P.,   experienced substantial problems in
servicing this debt because a perception developed in both the
public and private debt and equity markets that the supply of
spectrum greatly exceeded  realistic customer demand.  While the
Federal Communications Commission offered Fortunet
Communications, L.P., a relief plan, this plan required Fortunet
Communications, L.P., to forfeit 30% of its down payment; as a
result of such anticipated forfeiture, in 1997 Fortunet
Communications, L.P., established a reserve of $6.6 million to
reflect the impairment in the value of its licenses.  In June
1998, Fortunet Communications, L.P., returned 28 of its
licenses, and 15 megahertz of its three 30 megahertz licenses,
and surrendered 70% of its down payment to the Federal
Communications Commission in exchange for credits, which were
used to pay all remaining indebtedness to the Federal
Communications Commission.  On April 15, 1999,  the Federal
Communications Commission completed a reauction of all the C-
Block licenses that were returned to it. Due to considerably
lower amounts bid for these licenses, in the quarter ended March
31, 1999, Fortunet Communications, L.P., recorded a further
reserve of $18.5  million to write down its investment in the
licenses, plus an additional $0.1 million of capitalized
expenses, leaving a net carrying value of $2.7 million at
December 31, 1999.

Because Sunshine has incurred losses since inception and have
not yet determined how to finance its operations, the report of
Ernst & Young LLP, its independent auditors, with respect to its
financial statements as of and for the year ended December 31,
2000, contains  an explanatory paragraph as to the Company's
ability to continue as a going concern. Such an  opinion may
adversely affect the Company's ability to obtain new financing
on reasonable  terms or at all.  Certain of the factors
considered by its auditors in making this determination have
been included in their report and have been disclosed in Note 1
to our financial  statements at December 31, 2001, that were
included in our Form 10-KSB  that was filed with the  Securities
and Exchange Commission.

                       Results of Operations

Neither Sunshine, nor its predecessors, have had any operating
history or revenues. Through  September 30, 2001, the Company
had cumulative net losses of $84,068,524, resulting from net
interest charges of $78,143,094, including commitment fees, and
reserves aggregating   $25,032,989 for impairment of its
personal communications service licenses.

In the three- and nine-month periods ending September 30, 2001,
as compared to comparable  periods in the prior year, results
predominantly reflected finance charges and varied due to
restructuring.

                    Liquidity and Capital Resources

At September 30, 2001, Sunshine had $216,162 in cash and current
payables of $623,857.  At the current level of operating
activity, operations will require approximately $300,000 to
$500,000 of cash flow on an annual basis.  When the Company
decides to employ an accelerated  business plan, significantly
higher levels of cash flow will be required.

On November 13, 2001, Sunshine announced a planned rights
offering to raise equity capital.  The proceeds from such rights
offering would be used to pay current liabilities and to fund
working capital needs over the next twelve months; there can be
no assurance, however, that such rights offering will be
successful in raising capital sufficient for such uses.


TXU: Sells UK Distribution Business to London Electricity Group
---------------------------------------------------------------
TXU (NYSE: TXU), a global energy company with operations on
three continents, announced the sale of its United Kingdom
distribution business and its 50 percent interest in 24seven to
London Electricity Group (LE Group) for GBP 1.310 billion
(US$1.873 billion).  The transaction provides total value to TXU
of GBP 1.450 billion (US$2.073 billion), after including the
assumption by London Electricity Group of GBP 890 million
(US$1.273 billion) fair market value (GBP 750 million (US$1.073
billion) face value) of debt.

TXU Europe's distribution business is the largest in the UK and
consists of the assets and wires that deliver electricity
through a 90,000 kilometer network in East Anglia and southeast
England.  24seven operates and maintains the networks for TXU
and London Electricity Group.

The sale of the distribution business is a major step towards
delivery of growth from the merchant energy business in Europe.
The transaction removes regulatory uncertainty, and in our
opinion, taking into account the value achieved for 24seven and
the market value of the transferred debt, represents a 26 per
cent premium to regulatory book asset value.  It also reduces
debt levels and improves interest coverage, strengthening TXU's
financial position through GBP1.310 billion (US$1.873 billion)
of debt reduction.  As a result of the sale, TXU has verified
with Standard and Poor's and Moody's bond rating agencies that
TXU Europe's current ratings of BBB+/Baa1, respectively, are
affirmed.

TXU's Chief Operating Officer, Europe, Paul Marsh said, "With
the recent legal separation of the retail business from the
distribution business in the UK and the lower returns and
declining profitability of the distribution business, now was
the right time for us to recycle capital into the faster growing
merchant energy business.  This sale will allow management to
focus solely on our core merchant energy business (generation,
trading and retail) and European growth prospects.  In addition,
the sale will remove regulatory uncertainty associated with the
distribution business."

"The employees in the UK distribution business and 24seven are
to be congratulated for their efforts in establishing the
efficiency frontier for distribution businesses in the UK and I
expect continued improvements in reliability and quality
customer service from the distribution business under LE Group's
new ownership," Marsh added.

"This is a very significant and strategic move for our European
operation and TXU as a whole," said Erle Nye, chairman and chief
executive of TXU.  "We have achieved a very good value for this
business which allows us to focus on the higher growth and
return potential in the merchant energy business.  With this
transaction, TXU will have more than three-fourths of our
business coming from the global merchant energy operations.
Combined with a stable dividend and a proven ability to deliver
value, this continues to demonstrate the value of this company."

TXU expects to incur one time charges of approximately $150
million (after tax) mainly associated with transaction and debt
restructuring costs.  The transaction requires approval from the
European Commission and certain bondholders.

Mike McNally, TXU's chief financial officer said that this
transaction further strengthens TXU's financial position with
the reduction of more than GBP1.310 billion (US$1.873 billion)
of debt.  "With total disposals of over $5 billion over the last
two years, we are well positioned to reduce net debt to total
capital to approximately 55 per cent by early next year.  This
transaction, along with growth in the merchant energy business,
will provide greater returns on invested capital.  With the sale
of this business, 2002 earnings expectations will be reduced by
approximately 39 cents per common share.  Growth from the
merchant energy business will replace that decrease within three
years. We are now comfortable with earnings estimates in a range
of $4.35 to $4.45 for 2002."

Both companies are pleased to report that there will be no
compulsory job losses as a result of last Monday's announcement.
There are 31 TXU employees in the UK distribution business and
2,500 in 24seven in total.

In a separate announcement, TXU has also announced the sale of
its 2,000 MW West Burton power station to London Electricity
Group for GBP 366 million (US$523 million).  In addition, London
Electricity Group will assume responsibility for the completion
of the installation of flue gas desulphurization plant at the
site already underway and reimburse TXU around GBP 60 million
(US$86 million for costs to date.

TXU is a global leader in electric and natural gas services,
merchant trading, energy marketing, telecommunications, energy
delivery and other energy-related services.  TXU is one of the
largest energy companies in the world with more than $28 billion
of annual revenue and $43 billion of assets. TXU is one of the
largest generators of electricity in the world and sells over
330 million megawatt hours of electricity and 2.8 trillion cubic
feet of natural gas annually.  TXU delivers or sells energy to
11 million customers primarily in the US, Europe and Australia.
Visit http://www.txu.comfor more information about TXU.

TXU was advised by Schroder Salomon Smith Barney on the
transaction.

In October, as reported in the Troubled Company Reporter,
holders of TXU's 7.17% Debentures due August 1, 2007, waived
certain indenture provisions.  As of September 2001, the
company's balance sheet showed strained liquidity with a current
ratio of 0.467 to 1.


TEAM MUCHO: Nasdaq to Delist Shares for 10-Q Filing Delinquency
---------------------------------------------------------------
TEAM Mucho, Inc. (Nasdaq: TMOS) announced that it had received a
Nasdaq Staff Determination on November 19, 2001 indicating that
the Company's failure to file its Form 10-Q for the period ended
September 30, 2001 was a violation of the continued listing
requirements set forth in Marketplace Rule 4310, and that its
common stock, therefore, is subject to delisting from The Nasdaq
SmallCap Market.  As a result of the delinquency, the trading
symbol for the Company's common stock will be changed from
"TMOS" to "TMOSE" at the opening of business on
November 21, 2001.

On or before 4:00 p.m. on November 26, 2001, the Company may
request a hearing before a Nasdaq Listing Qualifications Panel
to review the Staff Determination.  The Company presently
intends to request a hearing.  If the request for a hearing is
made by 4:00 p.m. on November 26, 2001, the delisting will be
stayed pending the Panel's determination.  There can be no
assurance the Panel will grant the Company's request for
continued listing.

As previously disclosed, on November 15, 2001, the Company filed
a Notification of Late Filing on Form 12b-25 relating to its
Form 10-Q for the quarter ended September 30, 2001.  As stated
in Form 12b-25, the delay is due to the Company's conversion to
new accounting software and integration of the accounting
software with its operating processes.  On November 19, 2001,
the Company filed on Form 8-K a press release entitled, "TEAM
Mucho, Inc. Third Quarter Update" which more fully described the
reasons for the delay.  The outstanding issue in the conversion
process is the reconciliation of approximately $500,000, mostly
related to accounts receivable.  Until the Form 10-Q is filed,
the Company will not answer detailed questions about the
Company's third quarter results.

S. Cash Nickerson, Chairman and CEO, has stated that "the
Company is working diligently to complete its Form 10-Q filing."

TEAM Mucho, Inc. is a leading Business Process Outsourcing
Company specializing in human resources.  TEAM Mucho, Inc. was
created by the December 2000 reverse merger of online business
center Mucho, Inc. and TEAM America Corporation, a market leader
in human resource and Professional Employer Organization (PEO)
services.  TEAM America currently has the number-one PEO market
share position in Ohio, Utah, Nevada, Oregon, Idaho, Tennessee
and Mississippi, and top-five positions in Northern and Southern
California.  TEAM America's Single-Point-Of-Contact Human
Resource Solution includes payroll, benefits administration, on-
site and online employee and employer communications and self-
service, employment practices and human resources risk
management, workforce compliance administration and severance
management.


TRICO STEEL: Selling Substantially All Assets to Nucor for $120M
----------------------------------------------------------------
Nucor Corporation (NYSE: NUE) announced that it has entered into
an agreement to purchase substantially all of the assets of
Trico Steel Company, LLC for $120 million.  Trico Steel Company,
LLC is in a Chapter 11 bankruptcy proceeding, having ceased
operations in March of 2001.  The agreement is subject to
approval by the bankruptcy court and the conclusion of a bidding
procedure under the auspices of the bankruptcy court as well as
a satisfactory resolution by Nucor of due diligence, regulatory
approvals, tax matters, and utility, equipment and other
contracts.

"The timing for start-up of this facility will depend upon
market conditions.  When successful, the addition of the Trico
assets will be a strong complement to our flat-rolled sheet
strategy," said Dan DiMicco, Nucor's president and chief
executive officer.

The Trico sheet steel mill facility, which originally began
operations in 1997, is located in Decatur, Alabama and has an
annual capacity of approximately 1.9 million tons.

Nucor is the largest recycler in the United States.  Nucor and
affiliates are manufacturers of steel products, with operating
facilities in ten states. Products produced are:  carbon and
alloy steel -- in bars, beams, sheet, and plate; steel joists
and joist girders; steel deck; cold finished steel; steel
fasteners; metal building systems; and light gauge steel
framing.


TRUSERV CORPORATION: Appoints Pamela Forbes Lieberman as New CEO
----------------------------------------------------------------
TruServ Corporation, the world's largest hardware and home
improvement cooperative, announced that Pamela Forbes Lieberman,
the co-op's Chief Operating Officer and Chief Financial Officer,
has been elected Chief Executive Officer.  Forbes Lieberman
joined TruServ in March as CFO and assumed the additional
position of COO following the July resignation of former CEO
Donald Hoye. She assumes her new responsibilities on November
16, 2001.

"The Board of Directors concluded after conducting an extensive
search that the ideal candidate to lead this company forward as
CEO is Pamela Forbes Lieberman," said Bill Blagg, TruServ's
chairman.  "Since assuming her new responsibilities in July,
Pamela has consistently demonstrated a drive, determination and
discipline that has resulted in the successful execution of
TruServ's restructuring plan," said Blagg.

After factoring out one-time restructuring and refinancing
charges, TruServ has returned to operating profitability,
despite lower revenues.

Blagg said Forbes Lieberman has been the key architect of
TruServ's successful turnaround plan and its execution.  "Under
her leadership in recent months, TruServ has consistently
exceeded its business plan in terms of strengthening the balance
sheet, reducing operating costs and improving margins," said
Blagg.  "She has the enthusiastic support of our board of
directors, employees, retail members, vendor community and our
lenders."

TruServ will operate without a chief operating officer and will
announce a new chief financial officer as soon as possible.

Prior to joining TruServ, Forbes Lieberman was senior vice
president and CFO of Shoptalk, Inc., a voice application
software company. Prior to Shoptalk, she was senior vice
president and CFO for the Martin-Brower Company, a distributor
in the McDonald's system.  From 1993 to 1998, Forbes Lieberman
was vice president and CFO for Fel-Pro Incorporated, where she
led the sale of the business to Federal Mogul.  She also spent
four years as vice president of finance acquiring and
integrating individual companies of Bunzl Building Supply, a
distributor of commodity and branded building products.  From
1975 to 1988, she held a variety of positions at Price
Waterhouse.

TruServ, headquartered in Chicago, is the world's largest
member-owned hardware cooperative with 2000 sales of $4 billion,
supporting annual retail sales of nearly $12 billion.  The
TruServ cooperative includes more than 7,300 independent
retailers worldwide operating under the store identities of True
Value Hardware, Grand Rental Station, Taylor Rental, Party
Central, Home & Garden Showplace and Induserve Supply.
Additional information on TruServ and its retail identities is
available at http://www.truserv.com


US MINERAL: Seeks to Extend Exclusive Period to May 25, 2002
------------------------------------------------------------
United States Mineral Products, doing business as Isolatek
International, ask the US Bankruptcy Court for the District of
Delaware to grant an extension on its Exclusive Periods.  The
Debtor wants the Exclusive Filing Period to move through March
25, 2002 and the Exclusive Solicitation Period through May 25,
2002.

United States Mineral Products filed for Chapter 11 Bankruptcy
Petition in the U.S. Bankruptcy Court for the District of
Delaware on June 23, 2001. Aaron A. Garber, David M. Fournier
and David B. Stratton at Pepper Hamilton LLP represent the
Debtor in its restructuring efforts.


WINSTAR COMMS: Seeks Removal Period Extension Until March 14
------------------------------------------------------------
Winstar Communications, Inc., and its debtor-affiliates ask the
U.S. Bankruptcy Court for the District of Delaware for an order
extending the period within which the Company may remove
prepetition actions and related proceedings to the District of
Delaware for continued litigation.  The Debtors propose that the
time by which they may file notices of removal in the bankruptcy
court with respect to civil actions pending on the Petition
Date, be extended to and including the latest to occur of
(i) March 14, 2001 or (ii) the day which is 30 days after entry
of an order terminating the automatic stay with respect to the
particular action sought to be removed.

Edwin J. Harron, Esq., at Young Conaway Stargatt & Taylor LLP in
Wilmington, Delaware, relates that the Debtors are party to
actions currently pending in the courts of various states. Since
the Petition Date, the Debtors have been devoting substantial
amounts of time to transitioning their businesses into chapter
11 and during this period, the Debtors have focused substantial
time and energy toward selling certain assets, as well as,
assessing leases and contracts and evaluating their business
options.  Accordingly, Mr. Harron says that the Debtors have not
had a full opportunity to fully investigate their involvement in
the pre-petition actions. The Debtors believe that it is prudent
to seek an extension to protect their right to remove the State
Court Actions.

The Debtors submit that the relief requested is in the best
interests of the Debtors, their estate and their creditors. Mr.
Harron explains that the extension sought will afford the
Debtors an additional opportunity to make fully informed
decisions concerning removal of each State Court Action and will
assure that the Debtors do hot forfeit valuable rights. Further,
the rights of the Debtors' adversaries will not be prejudiced by
such an extension because any party to a State Court Action that
is removed may seek to have it remanded to the state court.
(Winstar Bankruptcy News, Issue No. 18; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


XEROX CORP: Fitch Rates 144A Convertible Trust Preferred at B+
--------------------------------------------------------------
Fitch has assigned a `B+' rating to Xerox Corp.'s (Xerox) $900
million convertible trust preferred securities 144A issuance due
2021. Proceeds will be used for general corporate purposes and
debt reduction. The company's and its subsidiaries' `BB' senior
unsecured debt rating is affirmed. The Rating Outlook is Stable.
The outlook reflects the company's improved liquidity situation,
which provides some cushion for operational shortfalls as the
company continues to execute on its turnaround strategy. The `B'
ratings for Xerox's commercial paper (CP) program and Xerox
Capital de Mexico, S.A. de C.V.'s $200 million `B' U.S. CP
program are withdrawn.

Fitch recognizes the company's improved liquidity, the progress
made in asset dispositions and its $1 billion cost cutting
program, its strong, technologically competitive product line
and business position, its continued effort to improve working
capital management, and the commitment to continue its cost
cutting program beyond the initial $1 billion. The ratings also
consider the company's strained credit protection measures,
refinancing risk of its $7.0 billion revolver due October 2002,
the ongoing Securities and Exchange Commission investigation
into Xerox's Mexican accounting issues and other accounting
matters, and overall weaker economic conditions. Although the
company's financial flexibility has improved with forecasted
flat to down revenues, it is crucial that Xerox executes its
cost cutting programs in order to return the core operations to
profitability.

As of September 30, 2001, Xerox's cash position was $2.4 billion
with total debt at approximately $16.1 Billion, of which more
than half is from the customer financing operations. However,
with the current proceeds from the convertible trust preferred
securities as well as funds from several planned securitizations
of its financing receivables with General Electric Capital Corp.
(GECC), the company's cash positions should increase
substantially.  Debt maturities for the fourth quarter are
estimated to be $1.3 billion, with a further $1.3 billion due in
the first half of 2002. The company's revolver expires in
October 2002 and Xerox is currently in compliance with all
covenants. However, based on third quarter financial results,
the cushion for the company's tangible net worth covenant was
only $182 million, compared to $1.1 billion at the end of the
third quarter of 2000. However, the current convertible trust
preferred offering will increase the cushion by $900 million, as
the covenant definition includes the issuance as an addition to
tangible net worth.

Credit protection measures for the latest twelve months ending
Sept. 30, 2001, show Xerox's leverage, measured by total debt
(including the financing segment) to EBITDA, increasing to
greater than 20 times compared to 14x at December 31, 2000. For
the same time period, the company's core interest coverage
(defined as core EBITDA divided by core interest expense)
declined to less than 1.5x from 2.4x at Dec. 31, 2000. Fitch
anticipates core credit protection measures will continue to be
challenged for the near term, despite continued anticipated cost
reductions from the company's ongoing restructuring programs.

Xerox has made significant progress with its turnaround
strategy. Asset sales have totaled more than $2.0 billion,
including an agreement to outsource approximately half of its
manufacturing, the common stock dividend has been eliminated,
and the company exited the ink-jet market, which was a
significant cash drain. In addition, Xerox continues to make
progress in exiting the customer financing business, with GECC
eventually being the primary source of customer financing in the
U.S. and Canada. The previously announced $1 billion cost
cutting program has been achieved ahead of schedule, including a
10% headcount reduction from year-end 2000. The company has
indicated that it has identified further cost cuts of
approximately $200 million that could occur in the next two
quarters. In addition to Xerox Corp., the ratings affected are:
Xerox Credit Corp. and Xerox Capital (Europe) plc's rated senior
debt.


* BOND PRICING: For the week of November 26 - 30, 2001
------------------------------------------------------
Following are indicated prices for selected issues:

Amresco 9 7/8 '05              30 - 33(f)
Asia Pulp & Paper 11 3/4 '05   26 - 28(f)
AMR 9 '12                      91 - 93
Bethelem Steel 10 3/8 '03       5 - 6(f)
Chiquita 9 5/8 '04             82 - 84(f)
Conseco 9 '06                  58 - 60
Enron 9 5/8 '03                65 - 75
Global Crossing 9 1/8 '04      17 - 19
Level III 9 1/8 '04            57 - 59
McLeod 11 3/8 '09              21 - 23
Northwest Airlines 8.70 '07    75 - 77
Owens Corning 7 1/2 '05        33 - 35(f)
Revlon 8 5/8 '08               49 - 51
Royal Caribbean 7 1/4 '18      80 - 84
Trump AC 11 1/4 '06            65 - 67(f)
USG 9 1/4 '01                  72 - 74(f)
Westpoint 7 3/4 '05            31 - 33
Xerox 5 1/4 '03                87 - 89

                           *********

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

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is provided by DebtTraders in New York. DebtTraders is a
specialist in global high yield securities, providing clients
unparalleled services in the identification, assessment, and
sourcing of attractive high yield debt investments. For more
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Real-time pricing available at http://www.debttraders.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
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For copies of court documents filed in the District of Delaware,
please contact Vito at Parcels, Inc., at 302-658-9911. For
bankruptcy documents filed in cases pending outside the District
of Delaware, contact Ken Troubh at Nationwide Research &
Consulting at 207/791-2852.

                           *********

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

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