TCR_Public/011127.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

           Tuesday, November 27, 2001, Vol. 5, No. 231

                           Headlines

ANC RENTAL: Seeks Court Approval to Use Cash Collateral
AAVID THERMAL: S&P Junks Ratings Over Looming Default Scenario
ACT MANUFACTURING: S&P Cuts Ratings Seeing Weak Credit Measures
AMERICAN PLUMBING: S&P Revises Low-B Rating Outlook to Stable
BETHLEHEM STEEL: Chicago Cold Seeks Okay to Use Cash Collateral

BRIDGE INFO: Court Approves De Minimis Asset Sale Procedures
BURLINGTON: Gets Approval to Continue Inter-Company Transactions
CANADA 3000: Ontario Steps In to Help Travelers & Travel Agents
CAPTAIN D: Refinancing Concerns Spur S&P to Junk Credit Rating
CORAM HEALTHCARE: Wants Plan Filing Time Extended to December 31

ESTATION NETWORK: Inks Debt Restructuring Pact with IBM Canada
EXODUS: Proposes Designation Rights Pact with Global Crossing
FEDERAL-MOGUL CORP: Signs-Up R.R. Donnelley as Notice Agent
GLOBAL CROSSING: S&P Cuts Ratings On Likely Covenant Violations
GOLFGEAR INT'L: Continues to Run Short of Working Capital

HAMILTON BANCORP: Kaufman Replaces Deloitte & Touche as Auditors
HUNTSMAN: Heightened Financial Concerns Spur S&P to Drop Ratings
IMPERIAL METALS: Gets CCAA Protection to Reorganize in Canada
INTEGRATED HEALTH: UST Appoints 2nd Amended Creditors' Committee
IRON AGE: Weak Credit Protection Measures Spur S&P Downgrades

LERNOUT & HAUSPIE: Gets OK to Finance Premiums with Cananwill
LOEWEN GROUP: Agrees to Pay Green Service $2 Million on Claims
LORAL CYBERSTAR: Launches Exchange Offers for Senior Notes
MATLACK SYSTEMS: Selling Chicago Property to Polmax for $1.2MM
MATLACK SYSTEMS: Has Until December 24 to File Chapter 11 Plan

METALS USA: Taps Fulbright & Jaworski as Bankruptcy Counsel
NETMAXIMIZER.COM: Ability to Continue Remains Uncertain
OWENS CORNING: Seeks Okay to Buy Detroit Property from Magellan
PARK-OHIO: Weak Results Nudge Ratings to Low-B and Junk Levels
PILLOWTEX: Committee Balks at 4th Amended DIP Financing Facility

POLYMER GROUP: Onerous Debt Levels Prompt S&P to Cut Ratings
RELIANCE GROUP: Taps Latham & Watkins as Special Tax Counsel
SHARED TECHNOLOGIES: Chapter 11 Filing Delays 10-Q Completion
TELIGENT INC: Court Okays Further Restructuring of Operations
TELSCAPE INT'L: Trustee Wants Removal Period Extended to Jan. 22

TRUMP HOTELS: Continues Attempts to Renegotiate Public Debt
USG CORP: Panel Asks Court to Modify Securities Trading Order
VAIL RESORTS: S&P Rates $100MM Senior Subordinated Notes at B
WARNACO GROUP: Gets Nod to Implement Key Employee Retention Plan
WEIGH-TRONIX: Talks to Amend Bank Covenants Spur S&P Downgrades

WESTERN POWER: Fails to Comply with Nasdaq Listing Requirements
WESTSHORE TERMINALS: Trustees Tap CIBC to Review Alternatives
WHEELING-PITTSBURGH: Net Loss of $40MM in Sept. Quarter Expected
WICKES: S&P Lowers Rating a Notch Citing Marginal Cash Flow
WINSTAR: Court Okays Hiring Carolina Financial as Broker

WORLD AIRWAYS: May Violate Covenant if Losses Continue in Q4

                           *********

ANC RENTAL: Seeks Court Approval to Use Cash Collateral
-------------------------------------------------------
ANC Rental Corporation, and its debtor-affiliates seek authority
to use their Secured Lenders' Cash Collateral to fund post-
petition operating expenses reflected in their November Cash
Budget, including post-petition costs relating to the
maintenance of the various vehicles used by the Debtors and the
payment of rent, taxes, utilities, salaries and wages, employee
benefits and necessary capital expenditures.

In the ordinary course of the Debtors' business, the Debtors,
provide liquidity to certain of their non-debtor foreign
subsidiaries on an "as needed" basis to cover working capital
shortfalls at certain times of the year. These foreign
subsidiaries represent important assets of the Debtors and are
critical to the Debtors' ability to provide their customers with
complete North American as well as international service. The
use of Cash Collateral to continue this practice, in the
ordinary course, would enable the Debtors to maintain and
preserve the substantial value that these foreign subsidiaries
bring to the Debtors.

The Debtors seek to use Cash Collateral to fund other
administrative expenses incurred by the Debtors during the
pendency of their chapter 11 cases, including:

A. professional fees and expenses allowed by the Bankruptcy
    Court

B. reimbursement of allowed expenses incurred by the members of
    any official committee appointed by the Office of the
    United States Trustee in the Debtors' cases,

C. fees payable under 28 U.S.C. Sec. 1930 and related costs, and

D. other charges incurred in administering the Debtors' chapter
    11 cases.

Bonnnie Glantz Fatell, Esq., at Blank Rome Comisky & Macauley
LLP in Wilmington, Delaware, points out that the failure to
obtain authorization for use of Cash Collateral will be fatal to
the Debtors and disastrous to their creditors, equity holders
and employees. The Debtors fund their working capital needs
through cash generated from their business operations and except
for certain contingent letters of credit, the Debtors do not
rely on any credit facility to meet their regular working
capital needs.

As of the Filing Date, Ms. Fatell informs the Court that
approximately $100,000,000 is in the bank, and available cash is
expected to increase to $114,994,000 at November 30, 2001.

Ms. Fatell argues that the Senior Lenders are well protected by
a significant equity cushion that adequately protects their
liens against any diminution in collateral value resulting from
the use of Cash Collateral. If all of the claims of the lenders
with alleged security interests are allowed in full, such
lenders would hold claims in the aggregate principal amount of
approximately $454,000,000, which would be secured by assets
worth approximately $998,366,000. In light of this 100% equity
cushion in the Corporate Collateral, Ms. Fatell contends that
the Secured Lenders are adequately protected with respect to
their alleged security interests.

Without immediate access to cash collateral, Ms. Fatell believes
that the Debtors' ability to maintain operations in the short
term will be jeopardized, if not destroyed, which will result in
immediate and irreparable harm to the Debtors' estates and
creditors. In addition, use of the Cash Collateral to operate
the Debtors' business in the ordinary course will result in the
preservation and enhancement of the value of this business, and
thus will preserve and protect the value of the Corporate
Collateral. Even if the Debtors could temporarily survive this
difficult period without Cash Collateral to support operations,
Ms. Fatell fears that they face a substantial and devastating
loss of revenue and other irreparable harm from the cancellation
of rentals, loss of employees and deteriorating employee morale
and relationships with their automobile suppliers, all of which
will adversely impact the value of the Debtors' businesses and
thus, the value of the Secured Lender's collateral. The ability
of the Debtors to remain viable entities and reorganize under
chapter 11 of the Bankruptcy Code depends upon obtaining the
interim and final relief requested in this Motion. Accordingly,
in light of the fact that the Corporate Collateral will be worth
substantially more if the Debtors are permitted to use the Cash
Collateral, Ms. Fatell asserts that the Secured Lenders
interests in the Corporate Collateral are adequately protected.

In addition to the protection the Secured Lenders derive from
their substantial equity cushion, the projected increase in the
amount of Cash Collateral over the next few months, and the
preservation of the going concern value of the Corporate
Collateral, the Debtors propose that, to the extent the Secured
Lenders have valid and perfected security interests in and liens
upon the Debtors' Corporate Collateral and the proceeds thereof,
the Debtors will grant additional adequate protection to the
Secured Lenders in the form of replacement liens upon assets
acquired after the Filing Date, and the proceeds thereof and to
the extent authorized by the Court, such liens may be deemed
duly perfected and recorded under all applicable laws, without
further action required of the Secured Lenders.

Ms. Fatell contends that the Debtors' need to use Cash
Collateral during the course of this case is most compelling
because without authorization to use Cash Collateral, the
Debtors would have no choice but to shut down all operations on
"day one" of this case.  Although the Debtors presently have
substantial cash balances, without the ability to use the cash
generated by the business, the Debtors cannot meet their
obligations to vendors or obtain the services needed to maintain
their business operations, pay the wages, salaries, rent,
utilities and other expenses associated with operating their
business. Ms. Fatell informs the Court that they have been
exploring their available options regarding the prospects of
obtaining, and the potential terms of, debtor in possession
financing. Although the Debtors are evaluating these options,
there can be no assurances that the Debtors will find terms for
such financing that satisfy the Debtors' needs going forward.
Until such time as any debtor in possession financing is in
place, Ms. Fatell asserts that the use of Cash Collateral will
be the Debtors' sole source of working capital with which to
operate their businesses.

In filing this Motion, Ms. Fatell points out that the Debtors do
not admit that the Secured Lenders hold valid, perfected or
enforceable pre-petition liens and security interests in and to
any of the Cash Collateral and the Debtors do not waive the
right to contest the validity, perfection or enforceability of
the Lenders' alleged pre-petition liens and security interests
in and to any such property. During the initial stages of the
Debtors' chapter 11 cases, the Debtors' primary task will be to
stabilize their businesses as the first step toward their
reorganization under chapter 11. Ms. Fatell explains that
because the efficient operation of the Debtors' businesses will
preserve and enhance their value, and because a substantial
portion of the Debtors' assets may constitute the Secured
Lenders' collateral, the costs and expenses of preserving and
enhancing the Debtors' going-concern value should be recoverable
from the Secured Lenders' collateral.

Ms. Fatell argues that the benefit to the Debtors, their
estates, and their creditors, from the relief the Debtors seek,
is self-evident. Authorization to use the Cash Collateral for
the preservation of the Debtors' businesses will benefit secured
creditors, unsecured creditors and the Debtors alike. Ms. Fatell
claims that failure to obtain authorization to use the Cash
Collateral would cause the Debtors to be unable to fund their
businesses, maintain their going concern value and fund costs
associated with these chapter 11 cases. Moreover, it is
important to note that the Debtors' estates are worth
significantly less in liquidation than they are as a going
concern.

Pending the hearing in respect of the Proposed Final Order, Ms.
Fatell submits that the Debtors require immediate use of the
Cash Collateral in order to maintain day-to-day operations, to
pay the amounts required to be paid in the motions filed on the
Filing Date, and to meet all of the administrative expenses of
these chapter 11 cases. The Debtors' attempt to maximize the
value of their estates will be immediately and irreparably
jeopardized to the detriment of their creditors if interim
relief is not obtained. Accordingly, the Debtors request that,
pending the Final Hearing in respect of the Proposed Final
Order, the Proposed Preliminary Order be approved in all
respects and that the terms and provisions of the Proposed
Preliminary Order be implemented and be deemed binding upon the
Secured Lenders and the Debtors. (ANC Rental Bankruptcy News,
Issue No. 2; Bankruptcy Creditors' Service, Inc., 609/392-0900)


AAVID THERMAL: S&P Junks Ratings Over Looming Default Scenario
--------------------------------------------------------------
Standard & Poor's lowered its corporate credit rating on Aavid
Thermal Technologies Inc. to triple-'C' from single-'B'. At the
same time, the senior subordinated notes were lowered to double-
'C' from triple-'C'-plus, and the senior secured bank loan
rating was lowered to triple-'C'-plus from single-'B'-plus. The
outlook is negative.

The rating action is based on the company's announcement that it
may require additional funds to meet the scheduled interest
payment due in the first quarter of 2002 and that it is
currently not in compliance with certain financial covenants on
its credit facility.

Concord, N.H.-based Aavid's operating performance has
deteriorated throughout 2001 as the company's computing and
networking markets experience a severe industry downturn. Third-
quarter sales fell by one-third, to just $46.5 million, from the
like period in the prior year. The sales drop was particularly
significant in Aavid's Thermalloy division, where sales
decreased 43% from the same period in 2000. Thermalloy's thermal
management products primarily serve semiconductor products for
the industrial electronics, computing, and networking end
markets. The business outlook is likely to remain challenging
over the foreseeable future and to hamper any meaningful
improvement in financial performance despite management's
restructuring efforts.

The company's operating loss widened to $15 million on
much-lower-than-expected sales. Credit measures, which were
already poor, deteriorated as the company went from being
marginally profitable in the beginning of 2001 to having
operating losses in the third quarter. The company's EBITDA for
the nine months ended September 29, 2001, was just $7.7 million,
and its total debt is $178 million. The company is in violation
of covenants under its credit facility, of which $17 million is
outstanding under its revolving credit facility and $41 million
outstanding under its term facility.

                        Outlook: Negative

Aavid's financial position is vulnerable, with very little
liquidity.  Ratings are likely to be lowered unless management
can improve near-term liquidity.


ACT MANUFACTURING: S&P Cuts Ratings Seeing Weak Credit Measures
---------------------------------------------------------------
Standard & Poor's lowered its corporate credit and bank loan
ratings on ACT Manufacturing Inc. to single-'B'-minus from
single-'B'-plus and its subordinated note rating to triple-'C'
from single-'B'-minus. At the same time, the ratings were placed
on CreditWatch with negative implications.

The ratings action reflects the company's limited financial
flexibility due to violation of bank loan covenants and
operating losses that are likely to persist in the near term,
resulting in deteriorating credit measures.  Hudson,
Massachusetts-based ACT provides electronic manufacturing
services, primarily to the telecommunications and networking
markets.

Sales fell to just $225 million in the third quarter of 2001
from $445 million in the second quarter of 2001. In addition,
management expects sales to decline by as much as 25%
sequentially from its third quarter 2001, when ACT posted a
$34.8 million operating loss, triggering bank covenant
violations. On November 9, 2001, the company entered into a
limited waiver to the credit agreement with its lenders, waiving
non-compliance by ACT of certain borrowing restrictions and
reduces the revolving loan availability.

Standard & Poor's will review the financial effect of near-term
financing plans to enhance liquidity, restructuring efforts, and
operating performance prior to resolving the CreditWatch
placement.


AMERICAN PLUMBING: S&P Revises Low-B Rating Outlook to Stable
-------------------------------------------------------------
Standard & Poor's revised its outlook on American Plumbing &
Mechanical Inc. (AMPAM) to stable from positive, affecting about
$167 million in debt outstanding. At the same time, Standard &
Poor's affirmed its ratings on the company.

The outlook revision follows the company's announcement that it
has lowered its EBITDA guidance downward to $46 million - $47
million for 2001 (down from August guidance of $50 million,
which was reduced from $58 million earlier in the year). The
decline is due to weakening housing construction market, which
is further intensifying pricing pressures and higher than
expected labor and insurance costs. As a result, for 2001,
EBITDA to interest coverage is expected to decline to about 2.5
times from 3.5x at September 30, 2000. Financial flexibility,
which had been expected to modestly improve, will remain
limited, with about $24 million of availability under the firm's
$95 million bank credit facility.

The ratings on AMPAM reflect the company's leading niche
positions in large, highly fragmented, and cyclical markets, and
an aggressive financial profile.

AMPAM is a leading provider of plumbing and mechanical
contracting services in the U.S. According to the U.S. Census
Bureau, privately-owned housing units authorized by building
permits declined in September by 3% below the August seasonally
adjusted run rate. Some markets that AMPAM competes in,
particularly in the southeastern locations and in Texas, have
seen more pronounced declines, which has led many local industry
participants to aggressively price new construction projects.
Over time, however, the industry should benefit from outsourcing
of mechanical and plumbing contracting services.

AMPAM's strategy is to achieve leading positions in selective,
faster growing regions in the North American residential and
commercial mechanical and plumbing contract service market
segments. The residential market (both single and multifamily),
which accounts for about 73% of AMPAM's sales, is a niche that
other large industry participants have generally considered
noncore. Key competitors are local "mom and pop" and a few
regional shops.  AMPAM's competitive advantages include product
breadth, design capabilities, and geographic reach, which are
all important in obtaining national account projects. As a
result, the company has been growing faster than the market,
indicating that it is gaining market share.

Operations are run on a decentralized basis, which allows the
firm to price projects at the local level and helps preserve the
entrepreneurial spirit of the local operator. With about 85% of
sales tied to new construction activity, earnings and cash flows
are cyclical. In a downturn, however, the company should be able
to gain market share from local players that exit the business,
and reduce costs quickly due to its highly variable cost
structure. Nevertheless, pricing and volume declines will likely
lead to a weaker financial profile. AMPAM is expected to focus
on improving internal operations, particularly with purchasing
leverage, prefabrication practices, and enhanced national
account activity. Internal growth will come from increased cross
selling and the start-up of new offices in good growth markets.

The financial risk assessment reflects AMPAM's aggressively
leveraged balance sheet and fair cash flow protection measures.
EBITDA to interest coverage was about 2.6x, and total debt to
EBITDA was about 3.4x, at September 30, 2001, but are expected
to decline modestly in the near term. Operating cash flow
generation will be used to support branch openings and for debt
reduction. Total debt to EBITDA in the 3.5x-4.5x and EBITDA to
interest coverage averaging between 2.0x and 3.0x are expected,
which are appropriate measures for the ratings.

                         Outlook: Stable

Leading market positions, a highly variable cost structure, and
an internal growth strategy limit downside risk. Highly cyclical
end-markets, modest financial flexibility, and an aggressively
leveraged financial profile restrain upside rating potential.

              Ratings Affirmed, Outlook Revised To Stable

      American Plumbing and Mechanical, Inc.
        Corporate credit rating                 B+
        Senior secured rating                   BB-
        Subordinated debt rating                B-


BETHLEHEM STEEL: Chicago Cold Seeks Okay to Use Cash Collateral
---------------------------------------------------------------
Chicago Cold Rolling, one of the debtors in bankruptcy cases of
Bethlehem Steel Corporation, seeks the Court's authority to use
cash collateral pledged to its Lenders and grant adequate
protection to those Lenders.

Jeffrey L. Tanenbaum, Esq., at Weil, Gotshal & Manges LLP,
reminds the Court that Chicago Cold Rolling is a wholly owned
indirect subsidiary of Bethlehem Steel Corporation that provides
cold rolling steel processing services at Bethlehem Steel's Burn
Harbor Division.

Five years ago, Mr. Tanenbaum relates, Chicago Cold Rolling
borrowed funds from NationsBank, N.A. (now known as Bank of
America), as agent, and certain financial institutions acting as
lenders under a Prepetition Credit Agreement.  As security for
the repayment of all amounts outstanding under the Credit
Agreement and other loan documents, Mr. Tanenbaum says, Chicago
Cold Rolling granted Bank of America a security interest in all
of Chicago Cold Rolling's real and personal property, including
without limitation, Chicago Cold Rolling's facility in Portage,
Indiana and its accounts, inventory, equipment, deposit
accounts, and general intangibles.

According to Mr. Tanenbaum, Bethlehem Steel guaranteed Chicago
Cold Rolling's obligations to Bank of America and the Lenders
under the Credit Agreement.  To secure its obligations under the
Bethlehem Steel Corporation Guarantee, Bethlehem Steel granted a
second lien on its headquarters facility in Bethlehem,
Pennsylvania.

Mr. Tanenbaum relates that the obligations matured by their
terms on or about November 29, 1999, and all amounts outstanding
thereunder have been due and payable since that time.

       Principal                                $17,953,873
       Interest                                     122,972
       Attorneys' Fees and Costs of Collection        6,810
                                                -----------
                                         TOTAL  $18,083,655

Chicago Cold Rolling propose that Bank of America, for the
benefit of the Lenders, shall retain a first priority lien upon
all of Chicago Cold Rolling's real and personal property as of
Petition Date.  Then, as adequate protection of Bank of
America's and Lenders' interests in the Pre-petition Collateral
(including in regard to the use of cash collateral and the use,
sale, lease, depreciation or diminution in value of the Pre-
petition Collateral and cash collateral from and after the
Petition Date, and the imposition of the automatic stay), the
Debtors have agreed, subject to Court approval, to provide:

   (a) To secure payment of the Obligations in an amount equal to
       the aggregate diminution in value, if any, of the Pre-
       petition Collateral and the use of cash collateral, a
       first priority lien, nunc pro tunc as of Petition Date, in
       all of Chicago Cold Rolling's real and personal property,
       whether created or acquired before of after the Petition
       Date, and the proceeds and product of the foregoing.

   (b) To secure payment of the Obligations in an amount equal to
       the aggregate diminution in value, if any, of the Pre-
       petition Collateral and the use of cash collateral, a
       super-priority claim, nunc pro tunc as of the Petition
       Date, against Chicago Cold Rolling with priority over all
       claims against Chicago Cold Rolling under section 503(b)
       and 507(a) of the Bankruptcy Code.

   (c) Payment on a monthly basis of all accrued and outstanding
       interest in respect of the Obligations pursuant to the
       terms of the Loan Documents, whether accrued prior to or
       after the Petition Date.

   (d) Payment or reimbursement on a current basis of Bank of
       America's administrative fees and the reasonable
       attorneys' fees and expenses incurred by the Agent and the
       Lenders (including any pre-petition fees and expenses) in
       connection with matters relating to the Loan Documents.

   (e) Remittance of the approximate sum of $34,000 currently
       held in escrow by counsel for the Agent pursuant to pre-
       petition agreements, to the Lenders for application to
       principal amounts outstanding.

In light of the adequate protection proposed, Mr. Tanenbaum
claims that Bank of America and Lenders do not object to Chicago
Cold Rolling's use of cash collateral.

Mr. Tanenbaum urge Judge Lifland to authorize Chicago Cold
Rolling to use the cash collateral nunc pro tunc as of the
Petition Date in order to maintain Chicago Cold Rolling's
ongoing operations and avoid immediate and irreparable harm and
prejudice to Chicago Cold Rolling's estate and all parties-in-
interest.  Absent the Court's authorization to use the cash
collateral, Mr. Tanenbaum warns, Chicago Cold Rolling will be
unable to pay its operating expenses and will be immediately and
irreparably harmed. (Bethlehem Bankruptcy News, Issue No. 5;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


BRIDGE INFO: Court Approves De Minimis Asset Sale Procedures
------------------------------------------------------------
Having sold substantially all of their assets to various third
parties, Bridge Information Systems, Inc., and its debtor-
affiliates are now seeking to sell their remaining,
miscellaneous assets.

Thus, at the Debtors' behest, Judge McDonald authorizes the
Debtors to take such steps as necessary to market and sell
certain of the Debtors' property:

     (i) that has not been sold or transferred to another entity,
         and

    (ii) that has fair market value in the aggregate of less than
         or equal to $500,000.

Accordingly, the Court establishes these Miscellaneous Sale
Procedures:

     (a) The Debtors may determine to conduct an auction or
         auctions to solicit bids for the sale of miscellaneous
         assets;

     (b) Debtors shall provide notice of any auction through
         publication in newspaper, periodical, or other medium
         that is reasonably calculated to apprise potential
         buyers of the relevant miscellaneous assets of such
         auction;

     (c) The Debtors shall provide notice of such auction no less
         than 5 days prior to such auction to:

          (i) any known creditor(s) asserting a lien on the
              miscellaneous asset subject to sale at such
              auction, and

         (ii) any entity or person identified on the then-current
              Master Service List;

     (d) The Debtors or their agents are authorized and empowered
         to determine, in their reasonable discretion, the
         highest and best offer for each miscellaneous asset or
         group of miscellaneous assets;

     (e) The Debtors shall file with the Court and serve to the
         Pre-petition Lenders, the DIP Lenders, the Committee,
         General Electric Capital Corporation, the United States
         Trustee and any known creditor(s) asserting a lien on
         the applicable miscellaneous asset a notice of the
         highest and best offer for sale of a miscellaneous
         asset;

     (f) The notice of sale shall contain a description of the
         relevant miscellaneous asset, the name of the purchaser
         of the miscellaneous asset, the marketing efforts
         undertaken to sell the miscellaneous asset, the purchase
         price and the basis for the Debtors' conclusion that the
         sale is in the best interests of the estate;

     (g) Except as provided in this order, the Pre-petition
         Lenders, the DIP Lenders, the Committee, GE Capital, the
         United States Trustee or any known creditor(s) asserting
         a lien on the applicable miscellaneous asset may object
         to the sale by filing an objection with the Court and
         serving it upon the debtors within 3 business days after
         receipt of the notice of sale;

     (h) Except as provided in this order, is an objection is
         filed and served within such 3-day period that cannot be
         resolved consensually, the Debtors shall not transfer
         the miscellaneous asset to the buyer without further
         court order;

     (i) The sale of each of the miscellaneous assets shall be
         negotiated at arms-length, without collusion, and in
         good faith; and

     (j) Any and all liens, claims, interests and encumbrances in
         the relevant miscellaneous asset shall attach to the
         proceeds of the sale of such miscellaneous asset with
         the same validity, priority, force and effect as such
         lien, claim, interest and encumbrance had upon such
         miscellaneous asset immediately prior to the closing of
         the sale, subject to any claims and defenses the
         Debtors, Pre-petition Lenders, DIP Lenders, or GE
         Capital may have with respect thereto.

Additionally, Judge McDonald gave the Debtors permission to
market and sell any miscellaneous asset having a fair market
value that is less than or equal to $25,000 in the ordinary
course in accordance with their best business judgment, without
further hearing or order of the Court.

Judge McDonald directed the Debtors to provide notice of the
Miscellaneous Sale Procedures to:

   (a) any prospective offeror parties in interest, upon written
       request to the Debtors;

   (b) each entity or person identified on the current Master
       Notice List;

   (c) each entity or person identified on the current Master
       Service List. (Bridge Bankruptcy News, Issue No. 21;
       Bankruptcy Creditors' Service, Inc., 609/392-0900)


BURLINGTON: Gets Approval to Continue Inter-Company Transactions
----------------------------------------------------------------
Not all of Burlington Industries, Inc.'s affiliates, including
certain domestic and all of their foreign affiliates, filed for
bankruptcy.  Prior to the Petition Date, Daniel J. DeFranceschi,
Esq., at Richards, Layton & Finger PA, in Wilmington, Delaware,
relates that the Debtors and one or more of their Non-Debtor
Affiliates engaged in inter-company financial transactions and
asset transfers in the ordinary course of their respective
businesses.  "Transfers of cash to and from appropriate bank
accounts are made on account of the Inter-Company Transactions,
which typically are in the nature of payment of costs related to
the production of goods and services procured by Burlington from
the Non-Debtor Affiliates for the benefit of all of the
Burlington Companies," Mr. DeFranceschi explains.  The Inter-
Company Transactions also include payments for:

     (a) the funding, if necessary, of the Non-Debtor Affiliates'
         working capital and capital expenditure requirements;

     (b) goods purchased by the Debtors and Non-Debtor Affiliates
         from one or more of the Debtors, or vice-versa; and

     (c) ordinary course asset transfers from one company to
         another.

According to Mr. DeFranceschi, the majority of the funds
transferred to the Non-Debtor Affiliates are made in Mexican
Pesos.  For these transactions, Mr. DeFranceschi says, the
Debtors purchase Mexican Pesos in the spot foreign exchange
market through Wachovia.  On the other hand, Mr. DeFranceschi
notes, U.S. Dollars are transferred from the Zero Balance
Account at Wachovia used specifically for foreign exchange
transactions to another account at Wachovia, and the Mexican
Pesos are credited to one of the Non-Debtor Affiliates' accounts
at Bancomer, S.A. in Mexico.

The Debtors anticipate that, in the ordinary course of business,
they will be called upon to participate in Inter-company
Transactions after the Petition Date, Mr. DeFranceschi tells the
Court.  That's why the Debtors seek the Court's authority to
continue the Inter-company Transactions.  "These transactions
reduce the administrative costs incurred by the Debtors and
their Non-Debtor Affiliates," Mr. DeFranceschi asserts.  By
contrast, if the Inter-company transactions were to be
discontinued, Mr. DeFranceschi warns that the Cash Management
System and related administrative controls would be disrupted --
to the detriment of the Debtors and their Non-Debtor affiliates.

In connection with the Intercompany Transactions, Mr.
DeFranceschi further relates that funds generated by the
domestic business operations of each participant, after any
applicable disbursements, generally flow into a centrally
maintained concentration account.  As individual Debtors and
Non-Debtor Affiliates participating in the Cash Management
System require funds to meet current obligations, Mr.
DeFranceschi explains, cash automatically is transferred from
the Concentration Account into the appropriate disbursement
accounts, as required to meet such current obligations.  In
addition, Mr. DeFranceschi notes, cash is transferred between
the Concentration Account and accounts maintained by the Non-
Debtor Affiliates.  Accordingly, at any given time, Mr.
DeFranceschi says, there may be balances due and owing from one
Debtor to another Debtor or to a Non-Debtor Affiliate.  "These
balances represent extensions of inter-company credit," Mr.
DeFranceschi informs Judge Walsh.

Mr. DeFranceschi further assures the Court that the Debtors
maintain strict records of all transfers of cash and can readily
ascertain, trace and account for all Inter-Company Transactions.
Moreover, Mr. DeFranceschi adds, the Debtors will continue to
maintain such records, including records of all current inter-
company receivable and payable.  To ensure that each individual
Debtor will not, at the expense of its creditors, fund the
operations of another entity, the Debtors will request that an
order be entered confirming that all inter-company claims
arising after the Petition Date as result of Inter-Company
Transactions be accorded administrative status.

After due deliberation, Judge Walsh grants the relief requested.
(Burlington Bankruptcy News, Issue No. 2; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


CANADA 3000: Ontario Steps In to Help Travelers & Travel Agents
---------------------------------------------------------------
The Government of Ontario has made changes to Ontario Travel
Industry Act regulations to help protect travelers and travel
agents who have suffered losses due to the insolvency of the
Canada 3000 group of companies, Minister of Consumer and
Business Services Norm Sterling said.

"Consumers who deal with Ontario-registered travel agents now
have better protection if their airline or cruise line goes out
of business through the Travel Industry Compensation Fund," said
Sterling.

Under the Travel Industry Act travel agencies have been required
to reimburse consumers for losses. Consumers could access the
compensation fund directly only in the event the agents went
bankrupt. The changes announced today will enable travelers to
access the compensation fund directly and will increase
individual claim limits for the failure of an airline or cruise
line to $5,000 from $3,500 per event for each individual.

"Given the difficulties experienced by the travel industry since
the tragic events of September 11th, the Ontario government
believes that making the industry-sponsored fund directly
accessible to consumers for a situation such as this helps the
travelling public and an important sector of the economy."

The changes come into force on January 2, 2002. Claims that
resulted from any event that occurred in the six months prior to
this date, including the failure of Canada 3000, would be
eligible for payment from the fund. Total compensation from the
fund is limited to $5-million per major event. The changes will
help consumers to quickly regain their money in the event of a
failure and will help to prevent travel agents from being
bankrupted by consumers' claims.

Consumers who purchase airline tickets directly from scheduled
air carriers or domestic charter carriers are not protected by
Ontario's industry- supported fund, since the regulation of
airlines is a federal responsibility. To address this situation,
Sterling has written to federal Minister of Transportation David
Collenette asking the Government of Canada to establish federal
safeguards to compensate consumers who suffer losses due to
airline failure modeled after the provincial fund.

"Ontario has acted swiftly to provide increased protection for
consumers and businesses within the limits of our jurisdiction,"
said Sterling. "We call on the federal government to follow
Ontario's lead and establish safeguards to compensate consumers
who purchased their tickets directly from an airline."

Some reimbursement for consumers who had booked directly with
Canada 3000 may be available from the companies' reserve funds,
through application to the trustee of bankruptcy,
PricewaterhouseCoopers LLP.


CAPTAIN D: Refinancing Concerns Spur S&P to Junk Credit Rating
--------------------------------------------------------------
Standard & Poor's lowered its corporate credit rating on Captain
D's Seafood Restaurants to triple-'C'-plus from single-'B'-plus.
At the same time, the ratings remain on CreditWatch with
developing implications, where they were placed June 21, 2001.

The rating action is based on heightened concerns regarding
Captain D's ability to refinance its existing $120 million bank
loan that expires December 31, 2001. The corporate credit rating
on Captain D's is based on the credit worthiness of its parent,
Shoney's Inc. Poor operating performance has affected Shoney's,
which consists of Shoney's Restaurants and Captain D's Inc., and
further weakness could make it more difficult for Captain D's to
refinance its pending debt maturities.

Comparable store sales at Shoney's Restaurants declined 1.6% for
the 40 weeks ended August 5, 2001, following declines of 1.8% in
2000, 3.6% in 1999 and 4.7% in 1998. Comparable store sales at
Captain D's declined 4.1% in the third quarter and 3.2% for 40
weeks ended Aug. 5, 2001. Shoney's has experienced prolonged
operating difficulties during the past several years due to the
combination of intense industry competition, lack of operational
focus and management turnover.

Credit protection measures at Shoney's are very weak, with
EBITDA coverage of interest at about 1.5 times for 40 weeks
ended August 5, 2001, and it is highly leveraged with total debt
to EBITDA at about 6.5x for 40 weeks ended Aug. 5, 2001.
Financial flexibility is limited to a $30 million revolving
credit facility of which only $6.5 million was available as of
August 5, 2001. Financial flexibility is further limited by
Shoney's contingent liabilities of $27.5 million. Moreover,
Shoney's faces maturities of its $5.2 million subordinated
convertible debentures in July 2002 and its $30 million
revolving credit facility in September 2002.

The ratings could be raised if Captain D's is able to obtain
refinancing for its maturing bank loan or if other sources of
capital are secured to improve near-term liquidity. The ratings
could be lowered if there is no progress.

Shoney's restaurants are full-service, family dining restaurants
that serve breakfast, lunch, and dinner. As of August 5, 2001,
there were 218 company-owned and 195 franchised Shoney's
restaurants located in 25 states. Captain D's restaurants are
quick-service seafood restaurants, which offer in-store,
carryout or drive-thru service serving lunch and dinner. As of
August 5, 2001, there were 352 company-owned and 212 franchised
Captain D's restaurants located in 22 states.


CORAM HEALTHCARE: Wants Plan Filing Time Extended to December 31
----------------------------------------------------------------
Coram Healthcare Corp. and Coram, Inc. ask the U.S. Bankruptcy
Court for the District of Delaware for more time to file their
Chapter 11 plan and to solicit acceptances of the Plan.

The Debtors wish to extend their Exclusive Periods to December
31, 2001 and March 4, 2002. In the event confirmation of the
Second Plan is denied, no party, who wishes to file its own plan
would be prejudiced if exclusivity remained in place for a few
additional weeks.

Coram Healthcare, a provider of home infusion-therapy services
filed for Chapter 11 bankruptcy protection on August 8, 2000 in
the District of Delaware. Under the terms of its bankruptcy it
still operates its more than 70 branches in 40 states and Canada
while it restructures its debt. Goldman Sachs and Cerberus
Partners each own about 30% of the firm. Christopher James
Lhuiler, Esq., at Pachulski Stang Ziehl Young & Jones PC
represents the Debtors in their restructuring efforts.


ESTATION NETWORK: Inks Debt Restructuring Pact with IBM Canada
--------------------------------------------------------------
eStation Network Services, Inc., (CDNX:YST) announces it has
agreed to terms with regard to a private placement for total
gross proceeds of $1,000,000, and a debt restructuring agreement
with IBM Canada Inc., with regard to its lease financing that
includes a lump sum payment by eStation to pay down outstanding
obligations and principal, reduced monthly payments of the
Company over a 42 month period and the funding of an additional
$500,000 of computer equipment and ABM services by IBM.

It is proposed that the Private Placement is for 33,333,333
subscription receipts exercisable to acquire, at the holder's
option and for no additional consideration, 1 unit comprising of
either (i) 1 fully paid and non-assessable common share and 1
common share purchase warrant of the Company, or (ii) 1 fully
paid and non-assessable series C convertible preferred share and
1 series C convertible preferred purchase warrant of the
Company, subject to certain adjustment in certain events, in
respect of each Subscription Receipt held. eStation has agreed
to grant the holder registration rights whereby the Company will
be obligated to file, at the holder's request, with applicable
Canadian securities regulators a prospectus qualifying the
distribution of the Subscription Receipts and all underlying
securities issuable upon the exercise of the Subscription
Receipts. In addition, if a final receipt is not issued for a
prospectus pursuant to the registration rights on or prior to 90
days after the exercise of the registration request, each
Subscription Receipt will entitle its holder to acquire 1.1
Units, except that the registration request may not be made
until 50 days after the closing date of the Private Placement.
The purchase price for each Subscription Receipt will be $0.03.
Each common share purchase warrant shall entitle the holder to
acquire one common share at an exercise price of $0.04 for a
period of two years from the closing date of the Private
Placement. Each Series C Preferred Share Warrant shall entitle
the holder to acquire one Series C Preferred Share at an
exercise price of $0.04 for a period of two years from the
closing date of the Private Placement. The Series C Preferred
Shares shall have substantially the same rights and privileges
as the 7.5% series B convertible preferred shares offered for
sale by the Company pursuant to an April 2001 private placement.
The Company has obtained the consent of the required majority of
the holders of the previously issued and outstanding
Subscription Receipts in respect of this financing.

Currently, the Company has 75,265,210 issued and outstanding
common shares, 34,656,750 issued and outstanding Subscription
Receipts convertible into Series B Preferred Shares or common
shares, and 20,803,403 common share purchase warrants and
options comprising 130,725,363 fully diluted common shares. Each
Series C Preferred Share will be convertible at the option of
the holder, at any time on or prior to the date which is three
years from the date of issuance of the Series C Preferred
Shares, into one eStation common share for the first two years
and 0.91 eStation common shares in the third and final year.
Each Series C Preferred Share will have a right to an annual
dividend equal to 7.5 per cent of the issue price which will be
payable semi-annually. eStation will have the option of
satisfying any dividend payment on the Series C Preferred Shares
by way of a cash payment or by the issuance of additional Series
C Preferred Shares at a price equal to 95 per cent of the
weighted average trading price of the eStation common shares for
the 20-day trading period ending five trading days prior to any
dividend payment date. The Series C Preferred Shares will mature
on the Maturity Date, at which time eStation will be required to
redeem the shares for cash at the redemption price or, at a
holder's option but subject to the receipt of all regulatory
approvals, to issue freely tradable eStation common shares on
the conversion terms set out above.

The Private Placement will have one subscriber which is a Labour
Sponsored Investment Fund. The sole holder of the Subscription
Receipts will also have the right to appoint two of seven
directors to the Board of Directors of eStation.

Under the IBM Agreement, the Company will apply letters of
credit in favor of IBM to pay outstanding obligations and reduce
the principal of its IBM capital leases to $4,947,901.27 which
will be amortized over 42 months. The IBM Agreement includes new
funding of $500,000 for computer equipment and ABM services,
half of which the Company may draw down at any time with the
remaining $250,000 available after March 31, 2002. The IBM
Agreement also includes, among other things, a right of first
refusal in favor of IBM to match any bona fide offer to lease
and supply ATMs to the Company, a right of first refusal in
favor of IBM to provide transaction financing and advertising
outsourcing to the Company for a period of 36 months, and a
requirement that Kim Oishi and Peter Edwards remain employees of
the Company for a minimum of 6 months or that management
satisfactory to IBM be in place if either Kim Oishi or Peter
Edwards ceases to be an employee after the 6 month period.

The Company understands that the Canadian Venture Exchange will
require that the Company send out a notice, as soon as
practically possible pursuant to applicable laws, for a special
meeting of shareholders to consider a consolidation of at least
4:1 of the Company's currently issued and outstanding share
capital.

"The Private Placement and IBM restructuring will provide
eStation the resources it requires to continue expanding its ABM
network and increasing the profitability of its ABM Network,"
said Kim Oishi, Chairman and CEO of eStation, "This financing
and restructuring will enable eStation to focus its efforts on
building its core business. We are very excited with the
prospects for working with our business partners to realize on
the tremendous opportunities in the Canadian ATM and self-
service space."

eStation (CDNX:YST) offers turnkey ABM solutions to major retail
and hospitality chains. eStation leverages innovative technology
to generate multiple revenue streams through strategic corporate
partnerships while providing consumers with convenient access to
products and services by leveraging the Internet. Retailers and
service providers of all kinds can utilize eStation's ABM
solutions to target consumers with on-screen advertising and in-
store coupons and promotions. Visit us online at
http://www.estation.comfor more information


EXODUS: Proposes Designation Rights Pact with Global Crossing
-------------------------------------------------------------
Exodus Communications, Inc., and its debtor-affiliates request
entry of an order approving a Designation Rights Agreement,
dated as of October 30, 2001, between the Debtors and Global
Crossing, Ltd., (GX) pursuant to which the Debtors will transfer
the right to designate certain Global Crossing Guaranteed Leases
for assumption and assignment to third parties or for rejection.

Mark S. Chehi, Esq., at Skadden Arps Slate Meagher & Flom LLP in
Wilmington, Delaware, relates that on January 2001, the Debtors
acquired GlobalCenter, Inc. in a stock transaction with GX and
affiliated entities. GlobalCenter operated 10 IDCs throughout
the United States and overseas and also leased office space. In
addition, a number of the GlobalCenter IDCs and office spaces
are leased from third party landlords, which GX guaranteed for
timely performance. In order to reduce operating expenses, Mr.
Chehi informs the Court that the Debtors are in the process of
consolidating operations and eliminating underutilized IDCs, a
number of which are subject to GX Guaranteed Leases. The IDCs
that are subject to the GX Guaranteed Leases contain valuable
tenant improvements and other property, including power
generators, HVAC systems, and other valuable equipment, that
cost hundreds of millions of dollars to purchase and install.

The Debtors have identified ten GX Guaranteed Leases that, but
for entry into the Designation Rights Agreement, the Debtors
would have sought to reject within the next month. The Debtors
believe that there may be other IDCs and offices subject to GX
Guaranteed Leases that the Debtors may decide to close. In early
October, Mr. Chehi submits that GX proposed to pay current
obligations under the GX Guaranteed Leases until such leases
could be assigned to a third party or otherwise disposed in
order to immediately begin the remarketing process for these
locations.  The Designation Rights Agreement is the culmination
of the parties' discussions regarding GX's proposal.

The following is a brief summary of the terms of the Designation
Rights Agreement:

A. Transfer of Designation Rights - The Debtors will transfer to
    GX all rights to direct the assumption and assignment to an
    assignee or rejection of GX Guaranteed Leases subject to
    the Designation Rights Agreement. GX will provide
    assignment and rejection directions to the Debtors whom, in
    turn, will file motions seeking Court approval of the
    proposed assignments or rejections. GX also may direct the
    Debtors to seek an extension with respect to the GX
    Guaranteed Leases. As stated more fully in the Designation
    Rights Agreement, GX will reimburse certain of the Debtors'
    expenses in carrying out the directions.

B. Advance of Lease Obligations - GX immediately will pay Lease
    Obligations accruing after October 15, 2001, November 1,
    2001 and November 5, 2001 with respect to the A Leases, B
    Leases and C Leases, respectively. Thereafter, on the 25th
    day of each month, GX will pay lease obligations under the
    GX Guaranteed Leases subject to the Designation Rights
    Agreement that must be performed in the succeeding month.

C. Marketing of Leases - GX will have the sole and exclusive
    right to market the GX Guaranteed Leases unencumbered by
    any prior brokerage agreement. If GX receives proceeds from
    the sale of a GX Guaranteed Lease in excess of its
    guarantee obligations and marketing and disposal costs, GX
    shall pay 10% of the Net Proceeds to the Debtors. GX will
    be responsible for all marketing and disposal costs.

D. Removal of Property - The Debtors will have sixty days to
    remove fixtures and other personal property from the sites
    subject to the GX Guaranteed Leases under the Designation
    Rights Agreement. The sixty-day period will be tolled
    during any period in which GX, a landlord or other
    interested party contests the Debtors' ability to remove
    such property.

E. Additional Leases - The Debtors and GX may add additional GX
    Guaranteed Leases to the Designation Rights Agreement.

F. Security - GX will pay security deposits in the amount of one
    month's rent to landlords to secure GX's payment of lease
    obligations.

G. Termination. The Designation Rights Agreement - will
    terminate on the earlier of one year after the Court's
    approves the agreement, the date the Court enters a
    confirmation order, or a final order is entered converting of
    dismissing each of the Debtors' chapter 11 cases.

The Debtors will benefit under the Designation Rights Agreement
in a number of ways, including

A. GX immediately will pay lease obligations accruing after
    October 15, 2001, November 1, 2001 and November 5, 2001, as
    the case may be, under ten GX Guaranteed Leases. Thus, the
    Debtors immediately will eliminate substantial
    administrative liability totaling approximately $2,500,000
    per month under the GX Guaranteed Leases.

B. The Designation Rights Agreement will allow the Debtors sixty
    days to remove Tenant Improvements from the GlobalCenter
    IDCs. This provision will give the Debtors a reasonable
    time period to remove Tenant Improvements worth potentially
    millions of dollars from the GlobalCenter IDCs. Absent
    approval of the Designation Rights Agreement, the Debtors
    would be forced to either abandon this potentially valuable
    property to landlords to avoid incurring further
    administrative liability for rent or pay rent totaling
    approximately $2,500,000 per month to landlords during the
    pendency of removal of the Tenant Improvements and other
    personal property.

C. The Designation Rights Agreement will provide the Debtors
    with an opportunity to obtain the maximum value for the
    Tenant Improvements through sale to an assignee of the GX
    Guaranteed Leases that GX procures through its marketing
    efforts. In addition, the Debtors will be entitled to 10%
    of the proceeds from the sale of the GX Guaranteed Leases
    in excess of GX's guarantee obligation and marketing costs.
    Absent approval of the Designation Rights Agreement, it is
    highly unlikely the Debtors would obtain similar
    recoveries.

Accordingly, the Debtors believe that approval of the
Designation Rights Agreement is in the best interests of their
estates and stakeholders. (Exodus Bankruptcy News, Issue No. 8;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


FEDERAL-MOGUL CORP: Signs-Up R.R. Donnelley as Notice 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)


GLOBAL CROSSING: S&P Cuts Ratings On Likely Covenant Violations
---------------------------------------------------------------
Standard & Poor's lowered its ratings on Global Crossing Ltd.
and its wholly owned subsidiaries Global Crossing Holdings Ltd.
and Frontier Corp. At the same time, Standard & Poor's lowered
its ratings on Global Crossing's 58.8%-owned subsidiary Asia
Global Crossing Ltd. All ratings remain on CreditWatch with
negative implications.

The downgrade of the ratings on Global Crossing and its wholly
owned subsidiaries is based on the company's announcement that
it will violate certain bank covenants in the fourth quarter of
2001 due to lower than previously anticipated results. Moreover,
Standard & Poor's estimates that the company's liquidity
position will be weaker near term than previously anticipated.
Global Crossing is in negotiations with its banks to amend the
credit facility. However, the ratings could be lowered further
if the amendment is not obtained.

As of September 30, 2001, the company had an unrestricted cash
balance was about $2.26 billion. Based on moderately improving
EBITDA in 2002, cost control measures, and lower capital
expenditures, Standard & Poor's estimates that this cash balance
should fund the company's business plan through 2002. However,
if Asia Global Crossing decides to draw the $400 million credit
facility available to it from Global Crossing, Standard & Poor's
estimates that Global Crossing's business plan would only be
funded into the third quarter of 2002. Therefore, proceeds from
the sale of IPC Informations Systems Inc. and Global Marine
Systems will be essential to supporting the company's business
plan beyond the third quarter of 2002. The ratings remain on
CreditWatch pending the receipt of an amended credit facility
and Standard & Poor's review of an updated business plan.

The ratings on Asia Global Crossing were lowered only one notch
due to the degree of separation that Asia Global Crossing has
because of its board of directors, which is not controlled by
Global Crossing. In addition, the directors appointed by
Softbank Corp. and Microsoft Corp., which each own about 14% of
Asia Global Crossing, have effective veto rights regarding
certain actions, including the filing of voluntary bankruptcy.
Still, the ratings on Asia Global Crossing are influenced by the
credit quality of Global Crossing and, therefore, the resolution
of Global Crossing's CreditWatch listing will also influence
Asia Global Crossing's ultimate rating.

                     Ratings Lowered and Remaining
                        on CreditWatch Negative

      Global Crossing Ltd.                            TO     FROM
        Corporate credit rating                       B-      B+
        Preferred stock                               CCC-  CCC+

      Global Crossing Holdings Ltd.
        Corporate credit rating                       B-     B+
        Senior unsecured debt                         CCC    B-
        $800 million 9.625% senior unsecured notes
         (Guaranteed by Global Crossing Ltd.)         CCC    B-
        Senior secured bank loan                      B-     B+
        Preferred stock                               CCC-  CCC+

      Frontier Corp.
        Corporate credit rating                       B-     B+
        Senior unsecured debt                         CCC    B-
        Preferred stock                               CCC-   CCC+

      Asia Global Crossing Ltd.
        Corporate credit rating                       B      B+
        Senior unsecured debt                         CCC+   B-

DebtTraders reports that Global Crossing Holdings Ltd's 9.625%
bonds due in 2008 (GBLX3) trade between 17.50 and 19.  Go to
http://www.debttraders.com/price.cfm?dt_sec_ticker=GBLX3for
real-time bond pricing.


GOLFGEAR INT'L: Continues to Run Short of Working Capital
---------------------------------------------------------
GolfGear International Inc. (OTCBB:GEAR), announced its results
of operations for the three months ended Sept. 30, 2001,
reporting net sales of $417,362 and a net loss of $367,228, as
compared with net sales of $573,702 and a net loss of $382,428
for the three months ended Sept. 30, 2000.

For the nine months ended September 2001, GolfGear reported net
sales of $1,728,887 and a net loss of $755,633, as compared with
net sales of $2,633,127 and a net loss of $478,354 for the nine
months ended Sept. 30, 2000. Net loss applicable to common
stockholders for the nine months ended Sept. 30, 2001 was
$855,300, as compared with $573,024 for the nine months ended
Sept. 30, 2000.

Net sales decreased by $156,340 or 27% for the three months
ended Sept. 30, 2001 as compared with Sept. 30, 2000, and by
$904,240 or 34% for the nine months ended Sept. 30, 2001 as
compared with Sept. 30, 2000.

Commented Don Anderson, president of GolfGear: "2001 has been a
very difficult period for GolfGear. The decline in orders from
key retail customers and distributors has been the primary
reason for GolfGear reporting lower revenues and increased
operating losses during 2001.

"This softening in the market has exacerbated our existing
shortage of working capital available to fund operations. We are
responding to these developments by attempting to increase
revenues through various means, as well as reducing certain
operating and administrative costs."

Continued Anderson: "We are also continuing our efforts to raise
additional capital to fund operations. However, given the
current state of the capital markets, there can be no assurances
that we will be successful in this regard. If we are not
successful, we may not have sufficient cash resources to
continue to conduct operations."

Concluded Anderson: "We have recently noted that insert
technology has begun to proliferate throughout the golf
industry, and is being utilized in major product lines by
several market leading competitors of GolfGear.

"We believe that this development further validates our belief
that insert technology is the wave of the future in the design
and manufacture of golf clubs. We are following this development
with interest, particularly as it relates to our patent
portfolio."

GolfGear was founded by Anderson in 1989, and offers a full line
of proprietary golf equipment under various brand names,
including "GolfGear," "Players Golf," "Diva" and "Leading Edge."
GolfGear's patent portfolio with respect to insert technology is
the largest and most comprehensive in the golf industry, with
nine domestic and foreign patents issued related to forged face
insert technology.

These patents incorporate a wide variety of forged face insert
materials, including titanium, beryllium copper, stainless
steel, carbon steel, aluminum, and related alloys thereof, and
include technology relating to varying the face thickness of the
insert.

GolfGear's Series A Senior Convertible Preferred Stock is solely
owned by M.C. Corp. As of Sept. 30, 2001, 243,853 shares of
Series A Senior Convertible Preferred Stock were issued and
outstanding. The Series A Senior Convertible Preferred Stock
automatically converted into common stock on Oct. 29, 2001.

On Nov. 8, 2001, M.C. advised GolfGear that it believed that a
reset provision in the underlying preferred stock documentation
had been triggered, thus causing the conversion rate of the
preferred stock to be adjusted. Accordingly, M.C. has requested
that GolfGear issue 8,953,019 shares of common stock upon the
conversion of the 245,030 shares of Series A Senior Convertible
Preferred Stock that it owned on Oct. 29, 2001.

However, GolfGear disagrees with M.C.'s interpretation of the
reset provision and believes that 2,450,300 shares of common
stock are issuable upon the conversion of the 245,030 shares of
Series A Senior Convertible Preferred Stock. GolfGear intends to
evaluate the underlying facts of this situation and prepare a
response to M.C.'s assertion.

M.C. is also GolfGear's exclusive distributor for GolfGear's
products in Japan pursuant to a distribution agreement dated
Sept. 1, 1999. The distribution agreement specifies annual
purchases of not less than $500,000 for year one (2000) and
$1,000,000 for year two (2001), with a minimum purchase
guarantee after year one of $750,000.

In addition, there is a one-time grace period for the minimum
purchase guarantee for one year after year two. Purchases by
M.C. were $384,000 for 2000 and $243,000 for the nine months
ended Sept. 30, 2001. GolfGear is evaluating M.C.'s performance
to date under the distribution agreement, and intends to
commence negotiations with M.C. regarding the status of the
distribution agreement.


HAMILTON BANCORP: Kaufman Replaces Deloitte & Touche as Auditors
----------------------------------------------------------------
Hamilton Bancorp, Inc. is unable to file its Quarterly Report on
Form 10-Q for the quarter ended September 30, 2001 because on
October 10, 2001, the Company received notice from its
independent auditor, Deloitte & Touche LLP, of its resignation
as the Company's certifying accountant. On October 31, 2001, the
Audit Committee of the Board of Directors of Hamilton Bancorp
engaged the accounting firm of Kaufman, Rossin & Co. as its new
independent auditor for its fiscal year ending 2001, effective
on October 31, 2001. As it has only been recently retained,
Kaufman has been unable to complete its review of the financial
information required to be included in the Form 10-Q.

For the quarter ended September 30, 2000, the Company reported a
net loss of $17.9 million. The Company expects to report a
smaller loss for the quarter ended September 30, 2001, as a
result of a lower provision for credit losses in 2001 compared
to 2000 and recovery of allocated transfer risk reserves in
2001, offset by a lower level of net interest income in 2001
compared to 2000.

                          *  *  *

As reported in the August 28, 2001, edition of the Troubled
Company Reporter, Fitch has lowered its ratings for Hamilton
Bancorp Inc. (HABK), and its principal subsidiary, Hamilton
Bank, N.A (the bank) and has placed the firm's ratings on Rating
Watch Negative. Specifically, Fitch lowered the Individual
Rating for both HABK and the bank to 'E' from 'D' recognizing
HABK's precarious financial position following a $24 million
after-tax loss for 2Q01, which depleted capital by nearly 24%.
HABK does not have any public debt outstanding, however, Fitch
lowered its long-term issuer rating for HABK to 'CCC' from 'B'
and the short-term issuer rating to 'C' from 'B'.

While the bank's short-term deposit rating was affirmed at 'B',
the long-term deposit rating was lowered to 'B-' from 'B+'. This
rating action, which follows Fitch's June 15, 2001 and Nov. 8,
2000 downgrades, suggests that the firm's viability, in the
absence of a sale, is questionable. In an amended regulatory
notice filed on March 28, 2001, HABK's primary regulator (Office
of the Comptroller of the Currency or OCC) requested that
Hamilton Bank, NA build its capital ratios to 12% Tier I, 14%
Total and 9% Leverage.


HUNTSMAN: Heightened Financial Concerns Spur S&P to Drop Ratings
----------------------------------------------------------------
Standard & Poor's lowered its ratings on Huntsman International
Holdings LLC and its subsidiary, Huntsman International LLC. At
the same time, Standard & Poor's affirmed its ratings on
Huntsman Corp. and its subsidiary, Huntsman Polymers Corp. All
ratings remain on CreditWatch with negative implications, where
they were placed on May 22, 2001.

The downgrades of Huntsman International Holdings LLC and
Huntsman International LLC reflect heightened concerns related
to the company's aggressive financial profile, which has
deteriorated due to elevated debt levels and weaker than
expected operating results as of September 30, 2001. Recent
operating results have reflected a number of persistent
challenges including lower volume and pricing in key product
areas including PO/MTBE, petrochemicals, and TIO2. These
conditions are expected to persist at least throughout 2001, and
will limit any opportunity to improve an already subpar
financial profile. As of September 30, 2001, Huntsman
International's financial profile reflected total debt to EBITDA
near 6.5 times and EBITDA interest coverage below 2x.

In addition, Huntsman International has announced that it is not
in compliance with the leverage covenant contained within its
bank facilities. Until successfully amended, this condition will
restrict Huntsman International's access to its bank facility,
thereby eliminating alternative financial flexibility. The
company further disclosed that the collateral pledged to support
Huntsman Corp.'s bank facilities could trigger change of control
provisions related to Huntsman International's subordinated debt
obligations. While these issues elevate near-term risk given the
challenges facing Huntsman Corp., Standard & Poor's does
anticipate that either issue will result in an acceleration of
Huntsman International's debt obligations.

The ratings on Huntsman International Holdings LLC and Huntsman
International LLC remain on CreditWatch pending further
disclosure related to the outcome of Imperial Chemical
Industries PLC's effort to put its shareholdings to Huntsman
Specialty Corp. If Huntsman is unable to fund the purchase of
the shares, then ICI may seek to force a sale of its interests
in the company. If such a transaction is completed and
structured in a manner that provides sufficient rights to any
new outside investors to ensure that Huntsman International's
credit quality is not harmed by Huntsman Corp.'s financial
challenges, then ratings are likely to be affirmed. If Huntsman
Specialty is able to purchase the shares, ratings will likely be
lowered to reflect the increased control of Huntsman Corp.

          Ratings Lowered, Remain on CreditWatch Negative

                                              To        From
      Huntsman International Holdings LLC
        Corporate credit rating               B+        BB-
        Senior unsecured                      B-        B

      Huntsman International LLC
        Corporate credit rating               B+        BB-
        Senior secured                        B+        BB-
        Subordinated notes                    B-        B

         Ratings Affirmed, Remain on CreditWatch Negative

                                              RATINGS
      Huntsman Corp.
        Corporate credit rating               CCC+
        Subordinated debt                     CCC-

      Huntsman Polymers Corp.
        Corporate credit rating               CCC+
        Senior unsecured                      CCC-

                               *   *   *

According to DebtTraders, Huntsman Polymers Corp.'s 10.125%
bonds due in 2009 (HMAN4) are trading in the low 80s. Go to
http://www.debttraders.com/price.cfm?dt_sec_ticker=HMAN4for
real-time bond pricing.


IMPERIAL METALS: Gets CCAA Protection to Reorganize in Canada
-------------------------------------------------------------
Imperial Metals Corporation (TSE:IPM.) reports comparative
financial results for the three and nine months ended September
30, 2001 and September 30, 2000 as summarized below:

                     Three Months Ended     Nine Months Ended
(unaudited)        Sept 30,   Sept 30,   Sept 30,   Sept 30,
                     2001       2000       2001       2000
                    -------    -------    --------   --------
               (dollars in thousands except for share amounts)

Revenues           $29,502    $25,892    $95,456    $70,331
Operating Income
(loss)             $3,417    $(1,570)     $(709)   $(5,632)
Net Loss           $(5,415)   $(1,382)   $(9,938)   $(6,033)
Net Loss Per Share $(0.07)    $(0.02)    $(0.12)    $(0.08)

The results for the three and nine months ended September
30,2001 include $6.0 million of one time non-cash gains related
to closure of the Mount Polley mine.

                         Mount Polley

As previously announced, mining and milling operations at the
Mount Polley mine were suspended due to continuing low copper
and gold prices. Orderly shutdown procedures were followed and
the mine will be maintained on standby pending an improvement in
metal prices.

                    Corporate Reorganization

Due to challenges faced by the Company as a result of continuing
low copper and gold prices and the suspension of the Mount
Polley Mine, Imperial has voluntarily filed for, and has been
granted, protection by the Supreme Court of British Columbia to
allow it to reorganize its business by way of a Plan of
Arrangement under the Company Act of British Columbia and the
Companies' Creditors Arrangement Act.

The Plan will allow the Company to maximize the value of its
existing assets for the benefit of all stakeholders. The Plan
will also give the Company the means to strengthen its balance
sheet, secure new financing and focus on attracting and
developing new opportunities in both the mining and the oil and
natural gas businesses.

Under the Plan, it will be proposed that Imperial divide its
operations into two distinct businesses, one focused on oil and
natural gas and the other focused on mining. All of the
Company's existing oil and natural gas and investment assets
will be retained in Imperial and a new company, to be owned by
the shareholders of Imperial, will be established to hold the
mining assets. The shareholders of Imperial will benefit by
holding shares in two companies that are more clearly focused on
their respective mandates.

As part of the Plan, it will be proposed that Imperial's
convertible debentures and a portion of Imperial's secured debt
will be exchanged for common shares to strengthen Imperial's
capital base. The unsecured creditors of the Mount Polley mine
owed less than $5,000 will receive cash in full payment of
amounts owed, while creditors owed more than $5,000 will receive
a combination of cash and shares in payment of their debt.

It is expected the Plan will be presented to a meeting of the
Company's shareholders and debtholders in January 2002 for
formal approval. Implementation of the Plan will be subject to
court and regulatory approval.

Successful completion of the corporate reorganization under the
Plan will allow the Company to move forward and explore new
avenues for growth. The Plan applies to Imperial and two of its
wholly owned subsidiaries, Mount Polley Mining Corporation and
Mount Polley Holding Company Limited.


INTEGRATED HEALTH: UST Appoints 2nd Amended Creditors' Committee
----------------------------------------------------------------
Pursuant to Section 1102(a)(1) of the Bankruptcy Code, the
United States Trustee for Region III appoints the following
persons in its second amended appointment to the Committee of
Unsecured Creditors in connection with Integrated Health
Services, Inc., chapter 11 cases:

(1)  Oaktree Capital
            333 South Grand Avenue, 28" Floor
      Los Angeles, CA 90071
            Attn:  Mr. Marc Porosoff
            Phone: (213) 830-6300, Fax: (213) 830-8585

(2)  Van Kampen Investment Advisory Corp.
            One Parkview Plaza
            Oakbrook Terrace, IL 60181
            Attn:  Mr. Douglas J. Smith
            Phone: (630) 684-6052, Fax: (630) 684-6740

(3)  General Electric Capital Corporation
            60 Long Ridge Road
            Stamford, CT 06927
            Attn:  William Edwards Magee
            Phone: (203) 585-1405, Fax: (203) 316-7978

       (4)  U.S. Bank, N.A. as Indenture Trustee
            180 East Fifth Street
            St. Paul, Minnesota 55101
            Attn:  Mr. Timothy Jon Sandell
            Phone: (651) 244-0713, Fax: (651) 244-5847

       (5)  The Income Fund of America
            333 South Hope Street, 55th Floor
            Los Angeles, CA 90071
            Phone: (213) 486-9020, Fax: (213) 486-9455

       (6)  Credit Suisse First Boston Corporation
            11 Madison Avenue
            New York, NY 10023
            Attn:  Mr. Alex Lagetko
            Phone: (212) 325-3810, Fax: (212) 325-8290

       (7)  PharMerica, Inc.
            175 Kelsey Lane
            Tampa, FL 33619
            Attn:  Mr. Gerald R. Gerlach
            Phone: (813) 626-7788, Fax: (813) 623-1167

       (8)  Gulf South Medical Supply, Inc.
            4345 Southpoint Boulevard, Jacksonville
            Florida 32216
            Attn:  Mr. Matthew Norman Adkins
            Phone: (904) 332-3287, Fax: (904) 332-3223

       (9)  Bank of America, N.A.
            101 South Tryon, NC1-002-31-31
            Charlotte, NC28255
            Attn: Mr. John F. Register
            Phone: (704) 386-5390, Fax: (704) 386-1759

Citibank, N.A. resigned from the Committee effective July 27,
2001, replaced by General Electric Capital Corp. effective
immediately. (Integrated Health Bankruptcy News, Issue No. 22;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


IRON AGE: Weak Credit Protection Measures Spur S&P Downgrades
-------------------------------------------------------------
Standard & Poor's lowered its ratings on Iron Age Holdings Inc.
and subsidiary Iron Age Corp. At the same time, all the ratings
were removed from CreditWatch where they had been placed with
negative implications August 2, 2001. The outlook is negative.

The downgrade reflects the company's deteriorating credit
protection measures, weak operating results, and Standard &
Poor's expectation that credit measures will remain weak in the
intermediate term.

Iron Age's operating performance has been negatively affected by
a weakening general economy, resulting in plant closings and
employee layoffs that affected Iron Age's customers. Sales
declined 9% while EBITDA declined 20% for the first six months
of 2001, and operating margins slipped to 14% for the last 12
months ended July 2001 from 15% in fiscal 2000. In the
intermediate term, business conditions remain challenging
because of the contraction in demand due to a slumping economy
and increased competitive pressure from consumer brand products.
Although Iron Age's footwear products have good brand
recognition, competition from more recognized consumer brands
has intensified, further pressuring Iron Age's sales.

Iron Age's financial profile is highly leveraged, with total
debt to EBITDA of about 8.0 times and EBITDA coverage of cash
interest of about 1.5x for the last 12 months ended July 2001.
In addition, required quarterly amortization of about $1.6
million from its Acquisition Credit Facility further increases
liquidity needs. Due to its deteriorating financial performance,
Iron Age may need to seek further easing of financial covenants
under its credit facility. Financial flexibility is limited with
about $20 million available under its revolving credit facility.

Iron Age is a leading distributor of safety shoes in the U.S.
The company distributes work and uniform shoes, in addition to
safety shoes, under the Iron Age and Knapp brand names, and
manufactures shoes at its subsidiary, Falcon Shoe Mfg. Co.

The rating reflects high debt leverage relative to a small cash
flow base, thin credit protection measures, and the highly
competitive and mature nature of the U.S. safety shoe market.
These risks are somewhat mitigated by the company's good market
position.

                        Outlook: Negative

Standard & Poor's expects Iron Age to be challenged in
stabilizing its operating performance and remaining in
compliance with its bank covenants. The ratings could be lowered
if credit measures deteriorate further and financial flexibility
erodes.

            Ratings Lowered, Removed from Creditwatch

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

      Iron Age Corp.
        Corporate credit rating          B-    B
        Senior secured debt              B     B+
        Senior subordinated debt         CCC   CCC+


LERNOUT & HAUSPIE: Gets OK to Finance Premiums with Cananwill
-------------------------------------------------------------
Luc A. Despins, Allan S. Brilliant, and Matthew S. Barr, each of
the New York firm of MILBANK, TWEED, HADLEY & Mccloy LLP, as
lead counsel, and Donna L. Harris, Robert J. Dehney, and Gregory
W. Werkheiser of the Wilmington firm of Morris, Nichols, Arsht &
Tunnell, acting as local counsel, ask, on behalf of Lernout &
Hauspie Speech Products N.V. and its affiliated debtors
Dictaphone Corporation and L&H NV Holdings USA, Inc., Judge
Wizmur for entry of an order (i) authorizing L&H NV to enter
into the Commercial Insurance Premium Finance and Security
Agreement with Cananwill, Inc., and (ii) modifying the automatic
stay to a limited extent necessary to perfect the lien granted
in the Agreement.  The Debtors remind Judge Wizmur that on
January 25, 2001, she entered an order authorizing L&H NV to
enter into a similar agreement with Cananwill to finance
$1,621,176.87 in insurance premium payments due under certain
general liability and property insurance policies.

The Debtors tell Judge Wizmur that, in the ordinary course of
their businesses, the members of the L&H Group are required by
state and federal law to maintain insurance policies, including
automobile, general liability, workers' compensation, and
various other types of insurance coverage customarily maintained
by companies the size of the L&H Group. Prior to the Petition
Date, L&H NV maintained various general liability, workers'
compensation, automobile liability, and excess liability
policies for the benefit of all of its subsidiaries, including
the members of the L&H Group. On September 1, 2001, these
insurance policies expired according to their terms.

L&H NV has renewed and/or replaced these insurance policies for
12 months with (i) a renewal general liability insurance policy
with Chubb Insurance Company of New Jersey, (ii) a renewal
workers' compensation/employer's liability insurance policy with
Chubb, (iii) a renewal automobile liability insurance policy
with Chubb, (iv) a new umbrella insurance policy with Royal
Insurance Company of America (Illinois), (v) a new excess
liability insurance policy with Kemper Insurance Company, and
(vi) a new excess liability insurance policy with St. Paul Fire
& Marine Insurance, Policy No. to be determined.

In the aggregate the Insurance Policies provide $51 million in
liability coverage. L&H NV is required to pay a lump sum premium
of $1,340,011 for the Insurance Policies to secure this
coverage. If such payment is not made, the insurers can
terminate coverage. L&H NV wishes to finance the payment of the
premiums by entering into the Agreement with Cananwill.  L&H NV
is responsible for the premium payment due under the Insurance
Policies. The expense, however, will be allocated amongst the
members of the L&H Group and L&H NV's other subsidiaries based
on the coverage provided under the Insurance Policies.

                  Premium Finance And Security Agreement

A. Payments Due Under Agreement

L&H NV proposes to enter into the Agreement to finance the lump
sum premium payment of $1,340,011 owed under the Insurance
Policies. The Agreement provides for a cash down payment of
$469,004. The Agreement also provides for the financing of
$871,007 in seven monthly installment payments of $127,026.94 at
an annual percentage rate of 6.23%, for a total of payments to
Cananwill of $1,358,192.58.

B. Lien Granted In Favor Of Cananwill

The Agreement is on terms that are standard and customary in the
industry, including the granting of a lien by L&H NV in favor of
Cananwill on "all sums payable to [L&H NV] under the listed
[Insurance Polices], including, among other things, any gross
unearned premiums and any payment on account of loss which
results in a reduction of unearned premium." Because the
granting of such a lien is customary and usual in financings
such as the Agreement outside of bankruptcy, L&H NV does not
believe that Cananwill or any other insurance premium financer
would enter into a premium finance agreement without the benefit
of such a lien. In addition, L&H NV believes that it would be
extremely difficult to obtain terms for such financing as
advantageous as those provide by Cananwill.

The L&H Group further requests that Cananwill's security
interest under the Agreement be deemed duly perfected without
further action by Cananwill. Many courts have concluded that an
insurance premium financer's security interest in unearned
premiums is deemed perfected without the need for any further
action.

C. Modification Of Automatic Stay

In addition, Cananwill has informed L&H NV that it will not
provide the financing unless L&H NV obtains an order of this
Court (a) authorizing L&H NV to execute and deliver the
Agreement and any amendments thereto as L&H NV may deem
necessary or desirable to carry out this Court's order, and (b)
providing that if there is a default with respect to any of L&H
NV's payment obligations under the Agreement, then, upon ten
days' written notice to L&H NV and its counsel, the automatic
stay shall be modified without further application to (or order
by) the Court (unless L&H NV cures the default within such ten-
day period) to allow Cananwill to exercise all rights and
remedies available to it under the Agreement. Such service shall
be accomplished by overnight mail or facsimile transmission of
the notice to (i) as to L&H NV, as set forth in the Agreement
and (ii) as to L&H NV's counsel, to Milbank, Tweed, Hadley &
McCloy LLP.

As part of the Agreement, L&H NV and Cananwill will acknowledge
that among those rights is the right to cancel the Insurance
Policies and to obtain all unearned premiums returnable
thereunder, which shall be paid directly to Cananwill. Under the
Agreement, notice shall be deemed to be notice of intent to
cancel as required under any applicable state law and L&H NV and
Cananwill agree that no additional notice shall be required to
satisfy the requirements thereof.

Under the Agreement, Cananwill has agreed that if the funds
obtained upon cancellation are in excess of the sum then due by
L&H NV to Cananwill, upon the clearing of such funds, Cananwill
shall pay to L&H NV such excess amount. If the funds obtained
upon cancellation are insufficient to repay all of L&H NV's
obligations under the Agreement, the deficiency amount shall
constitute an administrative expense of the estate under section
503(b) of the Bankruptcy Code.

                      Good Faith Of Cananwill

L&H NV and Cananwill have negotiated the terms of the Agreement
in good faith and, accordingly, the L&H Group requests that the
Court find that Cananwill is extending credit in good faith.
The Bankruptcy Code provides that if the debtor-in-possession is
unable to obtain unsecured credit allowable as an administrative
expense under the Bankruptcy Code, then the Court, after notice
and a hearing, may authorize the debtor-in-possession to obtain
credit or incur debt on, inter alia, the following bases:

        (1) with priority over any or all administrative expenses
            of the kind specified in section 503(b) or 507(b) of
            the Code;

        (2) secured by a lien on property of the estate that is
            not otherwise subject to a lien; or

        (3) secured by a junior lien on property of the estate
            that is subject to a lien.

To succeed in a motion under this Code section, debtors must
show: (1) they are unable to obtain unsecured credit; (2) The
credit transaction is necessary to preserve the assets of the
estate; and (3) The terms of the transaction are fair,
reasonable, and adequate, given the circumstances of the debtor
borrower and the proposed lender").

             Insurance Premium Financiers Require
              A Lien On Unpaid Insurance Premiums

L&H NV wishes to finance the lump sum insurance premium payment
due under the Insurance Policies to preserve its cash. Cananwill
will not finance the insurance premium payment due under the
Insurance Policies without the benefit of a lien on the unpaid
premiums. As it is a customary and usual business practice for
insurance premium financiers to secure the unpaid premiums with
a lien (even outside of bankruptcy), L&H NV does not believe
that any other insurance premium financer would enter into a
premium finance agreement without the benefit of such a lien. In
addition, L&H NV believes that it would be extremely difficult
to obtain terms for such financing as advantageous as those
provided by Cananwill, which include, among other things, an
interest rate of 6.23%.

       Transactions Contemplated By Agreement Are Necessary
         To Preserve Assets of L&H Group And Its Estates

The members of the L&H Group are required by state and federal
law to maintain insurance policies, including automobile,
general liability, workers' compensation, and various other
types of insurance coverage customarily maintained by companies
the size of the L&H Group. In addition, in the absence of the
Insurance Policies, the L&H Group will be exposed to liability
relating to, among other things, workers' compensation and
automobile accident claims, which could deplete the assets of
the members of the L&H Group and their estates. L&H NV wishes
to finance the lump sum insurance premiums to preserve cash
which the L&H Group needs to successfully reorganize. If L&H NV
is not authorized to enter into the Agreement with Cananwill, it
will be forced to utilize its valuable cash to make the lump sum
payment. Accordingly, the transactions contemplated by the
Agreement are necessary to preserve the assets of the L&H Group
and its estate.

      Terms of Agreement Are Fair, Reasonable, and Adequate

Entering into the Agreement will allow L&H NV to finance the
lump sum insurance premiums required under the Insurance
Policies. The Agreement was negotiated in good faith and offers
favorable terms, including a 6.23% interest rate. The granting
of a lien on the unpaid insurance premiums is standard and
customary in the insurance premium financing industry.
Accordingly, the terms of the Agreement are fair, reasonable,
and adequate.

           Authorizing L&H NV To Enter Into Agreement
        Is In Best Interest of L&H Group And Its Estates

The members of the L&H Group are required by state and federal
law to maintain certain insurance policies. In addition, without
the Insurance Policies, the members of the L&H Group would be
exposed to liability that could deplete the assets of their
estates. If L&H NV is unable to enter into the Agreement, it
will be forced to utilize valuable cash that the L&H Group needs
to successfully reorganize to make the lump sum payment.
Accordingly, it is in the best interest of the members of
the L&H Group and their estates for L&H NV to enter into the
Agreement.

Moving promptly to dispose of one of the few non-controversial
items in this case, Judge Wizmur enters her order approving this
Motion and granting the stay relief to the extent requested.
(L&H/Dictaphone Bankruptcy News, Issue No. 15; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


LOEWEN GROUP: Agrees to Pay Green Service $2 Million on Claims
--------------------------------------------------------------
In 1996, LGII purchased the stock of Debtor Green Service
Corporation (GSC) from H. Michael Green. In connection with the
purchase, LGII and TLGI delivered a non-interest bearing
Promissory Note in an original principal amount of $4,500,000
payable to Green. The Promissory Note obligated LGH and TLGI to
make monthly payments of principal to Green in the amount of
$25,000 for 180 months, through January 2011 secured by property
owned by and interests of GSC.

The payments were stayed as a result of the commencement of the
LGII and TLGI chapter 11 cases. On the Petition Date, the
outstanding principal balance under the Promissory Note was
$3,500,000.

Green filed 3 proofs of claim:

(a) proof of claim numbered 4049 against the chapter 11 estate
     of LGII, asserting a secured claim in the amount of
     $3,500,000 plus interest, fees and costs under the
     Promissory Note and the Security Agreements;

(b) proof of claim numbered 4050 against the chapter 11 estate
     of TLGI, asserting a secured claim in the amount of
     $3,500,000 plus interest, fees and costs under the
     Promissory Note and the Security Agreements; and

(c) proof of claim numbered 4051 against the chapter 11 estate
     of GSC, asserting a secured claim in the amount of
     $3,500,000 plus interest, fees and costs under the
     Promissory Note and the Security Agreements.

Green subsequently filed his Motion for Relief from Stay to
pursue his remedies or alternatively, for adequate protection
The Debtors opposed Green's request for modification of the
automatic stay or the payment of adequate protection payments.

Under the Plan, secured claims, with certain exceptions, are
classified in Class 4 the treatment of which may be determined
by an agreement between the holder of the claim and the
applicable Debtors.

To resolve the parties' disputes regarding the relief requested
in the Stay Relief Motion and the Bankruptcy Claims, the parties
stipulate and agree that the GSC Claim will be an allowed,
secured claim in the amount of $2,000,000 and will be satisfied
in 3 installments the latest of which falls due on March 31,
2003.

The obligations of the Debtors to make the Payments shall
continue to be secured by the Collateral, the Security
Agreements and all other related documents.

Green agrees to release the Debtors of claims relating to the
Promissory Note and the Security Agreements and covenant not to
Sue except for his right to the Payments.

The Debtors and Green have agreed that, should the Debtors sell
substantially all of the Collateral or the shares of the entity
that owns the Collateral at any time prior to the date of the
final payment, the Debtors shall pay to Green the aggregate
amount of the remaining unpaid payments at the closing of the
sale.

Judge Walsh has given his stamp of approval to the stipulation.
(Loewen Bankruptcy News, Issue No. 50; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


LORAL CYBERSTAR: Launches Exchange Offers for Senior Notes
----------------------------------------------------------
Loral Space & Communications (NYSE: LOR) said that its wholly
owned subsidiary, Loral CyberStar, Inc., has commenced its
previously announced exchange offers and consent solicitations
for $927 million of its debt (plus accrued interest): the senior
notes due 2007 and the senior discount notes due 2007.

The exchange offers and consent solicitations will expire at
midnight, New York City time, on Thursday, December 20, 2001,
unless extended or terminated.

Under the terms of the offers, holders of these two Loral
CyberStar notes would receive in total up to $675 million
principal amount of new Loral CyberStar senior notes due July
15, 2006, together with five-year warrants to purchase up to
approximately 6.7 million shares of Loral Space & Communications
common stock (less than two percent of outstanding Loral shares)
at 110 percent of the market price of Loral stock calculated
over the ten consecutive trading days preceding the second
trading day before the closing of the exchange offers.

The interest rate on the new notes will be 10%, a reduction from
the 11.25% interest rate on the existing senior notes and the
12.5% rate on the existing senior discount notes. Because of the
lower interest rate and the $252 million reduction in debt
(assuming 100 percent acceptance), Loral's annual cash interest
payments will be reduced by $43 million.

The terms of the exchange offers also provide that notes not
tendered in exchange, if any, will remain outstanding at their
original principal amounts, maturities and interest rates, but
will lose the benefits of substantially all of their covenant
protections.

The $927 million of Loral CyberStar debt is comprised of senior
notes due 2007 (principal amount $443 million) and senior
discount notes due 2007 (principal amount $484 million, with
accreted value of $470 million as of October 15, 2001). If fully
exchanged, holders of senior notes and senior discount notes
will receive $332.4 million principal amount and $342.6 million
principal amount, respectively, in new notes.

Closing of the exchange offers is conditional on, among other
things, acceptance by holders of at least 85 percent of the
existing notes. Holders of more than 50 percent of the existing
notes have already agreed to participate in the exchange offers
and consent to the requested amendments. The new notes will be
guaranteed by Loral, while the existing notes are non-recourse
to Loral.

The lead manager and solicitation agent for the transaction is
Dresdner Kleinwort Wasserstein. In addition, Banc of America
Securities LLC, JPMorgan and Lehman Brothers Inc. are serving as
co-managers and solicitation agents.

Holders of the existing notes will receive the exchange offer
document, letter of transmittal and related documents by mail.
In addition, a copy of these documents and more information
about the exchange offer can be obtained by contacting the
information agent, Morrow & Co., Inc., at the numbers below.

         Banks & brokerage firms call:               800-654-2468

         U.S. noteholders call:                      800-607-0088

         International noteholders call collect:     212-754-8000

Loral Space & Communications is a high technology company that
concentrates primarily on satellite manufacturing and satellite-
based services. For more information, visit Loral's web site at
http://www.loral.com

Formerly Loral Orion (before that, Orion Network Systems), Loral
CyberStar is a subsidiary of Loral Space & Communications. The
company provides satellite transmissions for high-end Web
connections and multimedia communications, as well as global
Internet access, data networking, teleconferencing, and distance
learning. Its customers include cable and TV programmers, ISPs,
news and information networks, and telecommunications carriers.
CyberStar's satellite systems are designed to support the
delivery of data, voice, video, and Internet transmissions
around the globe.  At the end of June, Loral Cyberstar sustained
strained liquidity as its current liabilities exceeded its
current assets by about $84 million.


MATLACK SYSTEMS: Selling Chicago Property to Polmax for $1.2MM
--------------------------------------------------------------
Matlack Systems Inc. asks the U.S. Bankruptcy Court for the
District of Delaware to approve the sale of Chicago Property to
Polmax Trucking with a purchase price of $1,200,000 subject to
higher and better offers.

If the Court grants this motion, the proceeds of sale will be
distributed to Keen Realty Consultant and any other entity
holding a lien on the Chicago Property. The surplus sale
proceeds shall be retained by the Debtors' estates.

The Debtors will conduct an auction of the Chicago Property on
December 10 at the offices of their counsel, Klett, Rooney,
Lieber & Schorling.

Matlack, North America's #3 tank truck company, provides liquid
and dry bulk transportation, primarily for the chemicals
industry.  The company filed for chapter 11 protection last
March 29, 2001, in the U.S. Bankruptcy Court for the District of
Delaware, and is represented by Richard Scott Cobb, Esq., at
Klett Rooney Lieber & Schorling.  Matlack's 10Q Report, filed
with the Securities and Exchange Commission on March 31, 2001,
lists assets of $81,160,000 and liabilities of $89,986,000.


MATLACK SYSTEMS: Has Until December 24 to File Chapter 11 Plan
--------------------------------------------------------------
Judge Mary Walrath of the U.S. Bankruptcy Court for the District
of Delaware approves Matlack Systems Inc.'s motion to extend
Exclusive Periods. The Debtors' Exclusive Filing Period is
extended through December 24, 2001 and the Exclusive
Solicitation Period through February 22, 2002.

Matlack, North America's #3 tank truck company, provides liquid
and dry bulk transportation, primarily for the chemicals
industry.  The company filed for chapter 11 protection last
March 29, 2001, in the U.S. Bankruptcy Court for the District of
Delaware, and is represented by Richard Scott Cobb, Esq., at
Klett Rooney Lieber & Schorling.  Matlack's 10Q Report, filed
with the Securities and Exchange Commission on March 31, 2001,
lists assets of $81,160,000 and liabilities of $89,986,000


METALS USA: Taps Fulbright & Jaworski as Bankruptcy Counsel
-----------------------------------------------------------
Metals USA, Inc., and its debtor-affiliates present an
application to employ and retain Fulbright & Jaworski LLP to
represent them in these cases to perform legal services.

John A. Hageman, the Debtors' General Counsel, tells the Court
that the Debtors have selected Fulbright because it has
substantial expertise and experience in bankruptcy matters and
will be able to provide the full range of services they need in
their cases.

Mr. Hageman submits that Fulbright will render general
bankruptcy representation to the Debtors, including:

A. advising and consulting the Debtors about their powers and
    duties as a debtors-in-possession in the continued
    operation of their businesses and management of their
    properties;

B. representing Debtors in cash collateral and debtor-in-
    possession financing negotiations and litigation;

C. representing the Debtors in asset sales and other liquidity
    transactions;

D. representing the Debtors concerning disposition of their
    executory contracts;

E. assisting the Debtors in the development, negotiation,
    litigation and confirmation of a chapter 11 plan of
    reorganization and the preparation of a disclosure
    statement, concerning treatment of secured and unsecured
    claims including both trade debt and bond debt;

F. preparing for the Debtors' necessary applications, motions,
    complaints, adversary proceedings, answers, orders, reports
    and other pleadings and legal documents, in connection with
    matters affecting the Debtors and their estates;

G. taking actions as may be necessary to preserve and protect
    the Debtors' assets including the prosecution of avoidance
    actions and adversary proceedings on the Debtors' behalf,
    defense of actions commenced against the Debtors,
    negotiations concerning litigation in which the Debtors are
    involved, objection to claims filed against the Debtors'
    estate and estimation of claims against the estates; and

H. performing other legal services that the Debtors may request
    in connection with these cases.

Mr. Hagement relates that Fulbright will charge the Debtors with
its current customary hourly rates and intends to reimburse
expenses incurred in connection with these cases. The current
hourly rates for Fulbright professionals are:

       Partners          $305 to $500 per hour
       Associates        $120 to $235 per hour
       Paralegals        $ 80 to $140 per hour

The current hourly rate of Zack A. Clement, the Debtors'
attorney in charge is $405 per hour.

Zack A. Clement, a partner of Fulbright & Jaworski LLP, informs
the Court that the Debtors hired Fulbright on October 15, 2001
to do work concerning their financial reorganization, including
the possibility of bankruptcy filing, and which Fulbright
received a $500,000 retainer. Subsequently, Fulbright received
payment of approximately $99,000 for work done through November
8, 2001 and on November 14, 2001, Fulbright received an
additional payment of $53,648.75 for work done through November
13, 2001.

Mr. Clement states that to the best of their knowledge, the
partners, associates, and counsel of the law firm Fulbright &
Jaworski LLP do no hold or represent interest adverse to the
estate, are disinterested persons and are qualified to represent
the Debtors. Fulbright has however, represented these entities
in matters unrelated to these cases:

A. Members of the Debtors' bank lending group or certain members
    of the Debtors' bank lending group, who still have claims,
    including Bank of America NA, PNC Business Credit, The CIT
    Group, Firstar Bank NA, Guaranty Business Credit Corp.,
    AmSouth Bank, Transamerica Business Capital Corp., Congress
    Financial Corp., General Electric Capital Corp., GMAC
    Commercial Credit LLC, Fleet Capital Corp., and Bank One
    Texas NA.

B. Indenture Trustee and holders for Debtors' public bonds known
    to the Indenture Trustee, including U.S. Trust Company of
    California NA, The Bank of New York, Bank One Trust Company
    NA, Morgan Stanley DW Inc., PNC Bank, State Street Bank &
    Trust, Credit Suisse First Boston, First Union National
    Bank, The Chase Manhattan Bank, Bear Stearns Securities
    Corp., Brown Brothers Harriman & Co., Morgan Stanley & Co.,
    Northern Trust Co., Fifth Third Bank, Deutche Banc Alex
    Brown Inc., Goldman Sachs & Co., and Mark & Shirley
    Stevens.

C. Twenty largest unsecured creditors of each debtor, including
    Alcoa Engineered Products, Alcoa Extruded Construction,
    Alcoa Inc., AT&T, Baker Botts LLP, Bank of America
    Securities LLC, Alumax Mill Products, Alumax Mill Products
    of Alcoa, American Business Machines, Bethlehem Steel,
    Bracewell & Patterson LLP, Central Freight Lines, Apollo
    Paper Co., Aramark Uniform Services, Ardco Inc., Chaparral
    Steel Co., Crane Plastic Siding LLC, Doepken Keevican &
    Weiss, Arthur Andersen LLP, EDS Corporation, Esco Corp., GE
    Capital, Heritage Paper Co., IBM, Macsteel Inc., Manpower
    Temporary Services, Mattco Forge Inc., Mitsubishi
    International Steel Corp., Ipsco-Texas, Ipsco Minnesota
    Inc., Ipsco Steel Inc., Mitsui & Co. (USA) Inc., MSS Group
    Inc., Napco Inc., National Steel Corp., Kaiser Alum &
    Chemical Corp., Kansas City Power & Light Co., Lindberg
    Corp., National Union, North Star Steel Co., RMI Titanium
    Co., Rohm & Haas Co., SSI, Stanley Engineering, United
    Parcel Service, Valspar Corp., Yellow Freight Train System
    Inc., Reliance Steel Center Inc., Pechiney Rolled Products,
    Pactiv Corp., Revere Copper Products Inc., and McDonnell
    Douglas Corp. (Metals USA Bankruptcy News, Issue No. 2;
    Bankruptcy Creditors' Service, Inc., 609/392-0900)


NETMAXIMIZER.COM: Ability to Continue Remains Uncertain
-------------------------------------------------------
NetMaximizer.com's recurring losses from operations and
operating cash constraints are potential factors which, among
others, may indicate that the Company will be unable to continue
as a going concern for a reasonable period of time. The
independent auditors' report on the December 31, 2000 financial
statements stated that "... the Company's recurring losses
from operations and current cash constraints raise substantial
doubt about the Company's ability to continue as a going
concern."

The Company is an Internet marketing company that introduces
customers to those who sell goods and services. The Company
collects fees based on visitors who reach third party sites and
commissions on any purchases made by such customers. The Company
provides access to third party sites primarily to members of
affinity groups such as churches, schools and unions.

As of September 30, 2001, NetMaximizer.com's full operations had
not commenced, although it had begun revenue generating
activities by opening a small number of affinity group
originating sites. The Company intends to continue to open
additional affinity group and business originating sites through
the remainder of the year. Additionally, it plans to accelerate
marketing efforts on behalf of those and other affinity groups
and businesses. Prior to September 28, 2001, although it had
insignificant revenue generated from start-up operations, the
Company had no material or substantive transactions or results
of operations. As a result, no meaningful comparison can be made
between present operations and operations during the years ended
December 31, 1995 to December 31, 2000.

               Material Changes in Financial Condition

NetMaximizer's total assets were approximately $1,156,000 at
September 30, 2001, compared with $935,000 at December 31, 2000,
and $1,478,000 at June 30, 2001. The increase in assets during
the first nine months of calendar year 2001 was primarily
attributable to the Company's further development of its web
site. Notwithstanding the investment in its common stock, its
cash account declined due to its lack of revenue. Company cash
and short-term investments were $53,457 at September 30, 2001,
compared with $80,448 at December 31, 2000 and $242,143 at June
30, 2001. Current liabilities were $703,852 at September 30,
2001, compared with $751,881 at December 31, 2000 and $829,885
at June 30, 2001. This decrease was principally the result of
reduced operating costs.

During the three months ended September 30, 2001, the Company
had minimal active business operations, resulting in revenue
from operations of $699. Although NetMaximizer.com began opening
originating sites for actual operations as of September 28,
2001, because of the method by which it is compensated for
activities through the originating sites, no significant revenue
from those operations was earned during the quarter. For the
nine months ended September 30, 2001, the Company also had
revenue resulting from the liquidation sale of its inventory of
$40,126 during the second quarter when the sale was conducted,
and $2,778 during the first quarter.

During the nine months ended September 30, 2001 NetMaximizer.com
incurred costs and expenses of $1,843,548 as compared to
$3,187,326 for the nine months ended September 30, 2000. This
decrease was due primarily to the revision to its strategic
plan, reducing the number of employees, eliminating inventory
and certain infrastructure, and the recognition of deferred
compensation (which only occurred during 2000). The approximate
amounts of the components of the costs and expenses are as
follows: amortization of web site design $255,000; amortization
of debt discount $431,000; payroll $299,000; professional fees
$124,000; interest on promissory notes $135,000; rent $95,000;
consulting fees $76,000; commissions $61,000; telephone $17,000;
travel $22,000; insurance costs $18,000; Internet access
$13,000; depreciation $9,000; other operating costs $289,000. By
comparison, the components of the costs and expenses of
approximately $480,000 for the three-month period ending
September 30, 2001, are as follows: amortization of debt
discount $144,000; payroll $81,000; amortization of web site
design costs $97,000; professional fees $24,000; interest on
promissory notes $49,000; rent $18,000; consulting fees $0;
commissions $22,000; telephone $(3,500); travel $6,000;
insurance costs $4,000; Internet access $4,000; depreciation
$2,000; other operating costs $32,500.

                  Liquidity and Capital Resources

As of September 30, 2001, the Company had $53,457 in cash, as
compared with $80,448 at December 31, 2000. During this same
nine-month period ending September 30, 2001, the Company
received $1,640,000 of proceeds from the sale of stock and
warrants.

NetMaximizer.com intends to fund continuing operations of the
Company through revenues generated by fees and commissions which
are commencing as it establishes additional operating sites.
Nonetheless, it may be necessary for it to raise additional
capital through additional sales of unregistered shares of its
common stock conducted under exemptions provided by the
Securities Act or by the rules of the SEC. There can be no
assurance that it will be able to receive sufficient revenue for
operations or to raise additional capital on favorable terms and
in the time required. If unable to generate sufficient revenues
from operations or raise additional capital it is questionable
whether NetMaximizer.com could continue as a going concern.


OWENS CORNING: Seeks Okay to Buy Detroit Property from Magellan
---------------------------------------------------------------
As part of their strategy to expand their Automotive Solutions
business, Owens Corning have determined that it is desirable to
relocate certain of their operations, to the Detroit area, a
well-known center of the automotive industry in the United
States. Towards these ends, the Debtors negotiated a Lease
Agreement with Magellan Two, L.L.C. for the lease of the
premises located at 46500 Humboldt Drive, Novi, Michigan.

In connection with the final negotiations of the Lease, the
Debtors determined that a purchase of the Premises might be more
advantageous than a lease and a purchase option was accordingly
included in both the draft filed with the Court and the final
version of the Lease which was executed by the parties on
September 21, 2001. The Debtors, pending Court approval, have
exercised the Purchase Option, which permits the Debtors to
purchase the Premises for $7,000,000, paid in cash at closing.

Thus, the Debtors move for an Order authorizing and approving
their exercise of a post-petition real estate purchase
option and execution and consummation of a Purchase and Sale
Agreement with Magellan Two, L.L.C., with respect to a facility
in Detroit, Michigan.

The Debtors believe that the $7,000,000 purchase price, which is
less than the $7,400,000 appraised value of the Premises, is an
attractive purchase price and will yield higher value to the
Debtors' estates than the lease option, so long as the residual
value of the Premises at the end of what would have been the
ten-year Lease term is equal to or greater than $4,250,000.

J. Kate Stickles, Esq., at Saul Ewing LLP in Wilmington,
Delaware, relates that the Debtors have performed an analysis of
both the Premises' resale market and the lease market and have
determined that a conservative estimate of the value of the
Premises at the end of the ten-year Lease term is $6,700,000.
The Debtors, in the exercise of their business judgment, have
determined that it is in the best interest of the Debtors and
their creditors, and necessary to the Debtors' business
operations, that they purchase the Premises pursuant to the
Agreement, instead of lease the Premises pursuant to the Lease.

Ms. Stickles explains that the Debtors need the use of
facilities in the Detroit region for their Automotive Solutions
business, and believes that the transaction contemplated by the
Agreement represents the best available means to services the
Debtors' needs. In addition, the facilities are necessary for
the Debtors' ongoing business operations, without which, the
Debtors' Automotive Solutions strategy would be severely
impacted, to the detriment of creditors and parties in interest.
Therefore, Ms. Stickles concludes that it is important to the
Debtors' business goals to set up a facility in the Detroit
area.

As stated above, the Debtors have determined that the purchase
price under the Agreement is less than the appraised value of
the Premises. Ms. Stickles believes that the purchase price will
yield higher value to the Debtors' estates than the Lease
option, so long as the residual value of the Premises at the end
of what would have been the ten-year Lease term is equal to or
greater than $4.25 million. Given the Debtors' analysis that the
value of the Premises at the end of the ten-year Lease term will
be $6.7 million, the Debtors submit that their exercise of the
Purchase Option and execution of the Agreement is an exercise of
their sound business judgment.

The Debtors believe that the financial terms of the Agreement
are competitive with those otherwise available in the
marketplace, and are more favorable than leasing the Premises
pursuant to the terms of the Lease and believe that their
proposed purchase of the Premises represents the lowest and best
cost option available to the Debtors for the facility at issue.
(Owens Corning Bankruptcy News, Issue No. 22; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


PARK-OHIO: Weak Results Nudge Ratings to Low-B and Junk Levels
--------------------------------------------------------------
Standard & Poor's lowered its corporate credit and senior
secured ratings on Park-Ohio Industries Inc. to single-'B' from
single-'B'-plus and its subordinated debt rating on the company
to triple-'C'-plus from single-'B'-minus. The outlook is
negative.

The company's debt totaled about $354 million as of September
30, 2001.

The rating actions reflect Park-Ohio's weak operating results
during 2001 and the expectation that results will be weaker than
expected for the near to intermediate term. The company reported
a 14% decline in sales and a 50% decline in operating income
during the first nine months of 2001 (pro forma for an asset
sale). The poor results were caused by overall weakness in the
manufacturing economy, particularly in the heavy-duty truck and
automotive industries. In addition, the planned ending of
certain automotive sales contracts and the cessation of
production of low volume non-automotive products contributed to
the weaker sales levels and lower fixed cost absorption. The
automotive and truck markets are expected to remain weak during
2002.

Restructuring and cost reduction actions have been more than
offset by the decline in demand. Despite $9 million of debt
reduction in the third quarter of 2001, Park-Ohio's debt levels
have increased by about $7 million since the end of fiscal 2000
due to weak cash flow generation and working capital changes.
Cash flow protection is thin and debt leverage is high, with
EBITDA interest coverage of 1.5 times and debt to EBITDA of more
than 7.0x.

The ratings on Park-Ohio reflect the company's leading niche
positions in fragmented and cyclical markets, combined with an
aggressively leveraged financial profile.

The company operates diversified logistics and manufacturing
businesses serving a variety of industrial markets. The
logistics segment accounts for 60% of total sales, supplying
fasteners and related products via supply chain management and
wholesale distribution services, to companies in the
transportation, electrical, and lawn and garden equipment
industries. Manufacturing operations, which account for 40% of
sales, include various aluminum components such as transmission
pump housings, pinion carriers, and other products supplied
primarily to automotive manufacturers. Other manufactured
products include crankshafts and camshafts, custom-engineered
heating systems, and molded rubber products sold to the
aerospace, railroad, automotive, and truck industries.

Business risk comes from cyclical end markets, including the
automotive and truck manufacturing segments, which represent
about 30% of total sales. The more stable logistics business, a
fairly broad product line, and a large customer base mitigate
demand variability. The continuing outsourcing trend among U.S.
manufacturers provides good growth opportunities for logistics
services.

Park-Ohio's financial risk is high, resulting from weak
operating results, an aggressively leveraged capital structure,
and modest cash flow protection measures. In response to weaker
demand, the company is restructuring several of its businesses,
including the closure of manufacturing plants and logistics
warehouses. These actions should help to reduce costs in 2002,
but may be offset by continued weak demand. Liquidity is modest,
with only $25 million available under a $180 million revolving
credit facility. The company's bank financial covenants were
amended in the third quarter of 2001 but remain very
restrictive.

The ratings incorporate the assumption that Park-Ohio will
maintain access to its credit facility and liquidity will remain
sufficient. Over time, total debt to EBITDA is expected to
average about 5.0x-5.5x, and EBITDA interest coverage is
expected to average about 1.5x-2.0x, appropriate levels for the
ratings.

                          Outlook: Negative

Failure to improve operating results and reduce debt leverage
could result in lower ratings.


PILLOWTEX: Committee Balks at 4th Amended DIP Financing Facility
----------------------------------------------------------------
Pillowtex Corporation, its debtor-affiliates, and the DIP
Lenders inked an agreement to extend the maturity date of the
Post-Petition Credit Agreement and amend other provisions
applicable to that credit facility.

William H. Sudell, Jr., Esq., at Morris, Nichols, Arsht &
Tunnell, in Wilmington, Delaware, relates that pursuant to the
Fourth Amendment, the Debtors and the DIP Lenders have agreed to
extend the scheduled termination date of the Post-Petition
Credit Agreement to June 30, 2002.

In addition, Mr. Sudell says, the Fourth Amendment:

   (a) amends the Post-Petition Credit Agreement to reduce the
       commitment under the Post-Petition Credit Agreement from
       $125 million to $100 million,

   (b) increases the unused commitment fee from 0.50% to 0.75% on
       every dollar not borrowed by the Debtors,

   (c) increases the interest rate for borrowings and the fee for
       undrawn letters of credit by 0.50%,

   (d) adds a new covenant limiting operational restructuring
       costs that may be incurred by the Debtors related to the
       permanent closure of a plant facility or facilities and
       the relocation of the production to an alternative
       facility or facilities to:

                                                   Maximum
                    Period                    Restructuring Costs
                    ------                    -------------------
            3 fiscal months ending 12/29/01         $7,000,000
            6 fiscal months ending 03/30/02         $8,000,000
            9 fiscal months ending 06/29/02         $9,000,000

   (e) limits capital expenditures to $17,000,000 from November
       14, 2001 through June 30, 2002, and $9,000,000 in any
       fiscal quarter;

   (f) requires the Debtors to maintain an asset coverage ratio
       to be no less than:

                     Period                 Minimum Ratio
                     ------                 -------------
            09/30/01 through 10/31/01        1.21 to 1.00
            11/01/01 through 12/31/01        1.20 to 1.00
            01/01/02 through 03/31/02        1.17 to 1.00
            04/01/02 through 06/30/02        1.15 to 1.00

    (g) requires the Debtors to generate positive EBITDA of not
        less than:

                      Period                    Minimum EBITDA
                      ------                    --------------
            1 fiscal month ending 11/03/01        $1,065,000
            2 fiscal months ending 12/01/01        1,256,000
            3 fiscal months ending 12/29/01        3,286,000
            4 fiscal months ending 02/02/02        4,164,000
            5 fiscal months ending 03/02/02        6,636,000
            6 fiscal months ending 03/30/02       10,566,000
            7 fiscal months ending 05/04/02       12,244,000
            8 fiscal months ending 06/01/02       14,299,000
            9 fiscal months ending 06/29/02       19,831,000

   (h) puts these chapter 11 cases on a fast-track to emergence
       by adding additional events of default tied to the
       Debtors' progress towards emergence from bankruptcy.

Specifically, Mr. Sudell explains, it will constitute an event
of default -- with no grace period -- if the Debtors fail to:

   (a) file on or prior to December 31, 2001 a feasible plan and
       disclosure statement, substantially complete in form and
       substance, that complies with all applicable provisions of
       chapter 11 of the Bankruptcy Code, and provides for the
       cash payment in full of all outstanding loans under the
       Post-Petition Credit Agreement, the replacement or
       liquidation of all letters of credit and the cash payment
       of all administrative expenses;

   (b) obtain the Court's approval of a disclosure statement on
       or prior to March 1, 2002;

   (c) obtain confirmation of a plan of reorganization on or
       prior to May 15, 2002; or

   (d) cause a plan of reorganization to become effective on or
       prior to June 30, 2002.

Waiver of any of these defaults will require approval of the DIP
Lenders and payment of a fee equal to 0.50% of the total
commitment under the Post-Petition Credit Agreement, Mr. Sudell
affirms.

Finally, Mr. Sudell discloses, the Fourth Amendment provides
that the Debtors will pay an amendment fee of 50 basis points,
or $500,000.

Bank of America, N.A., continues to serve as the Administrative
Agent, Issuing Bank and as a Lender.  The other members of the
DIP Lending Syndicate are:

            * The Bank of Nova Scotia
            * Goldman Sachs Credit Partners, L.P.
            * Credit Lyonnais - New York Branch
            * Lehman Commercial Paper, Inc.
            * Fleet National Bank
            * PB Captial Corporation
            * Franklin Floating Rate Trust
            * General Electric Capital Corporation
            * OCM Administrative Services II, L.L.C.
                 by Oaktree Capital Management, LLC
            * Foothill Income Trust II, L.P.

Mr. Sudell tells the Court that a condition to the Fourth
Amendment is that the order authorizing the amendment must also
contain a clarification that proceeds from the liquidation of
accounts receivable and inventory pertaining to the Debtors'
Blanket Division can be used to pay down obligations under the
Debtors' Pre-petition Credit Facility.

In keeping with pre-petition negotiations over the Debtors'
post-petition financing, Mr. Sudell explains, the Final DIP
Financing Order provides that the net proceeds from the
liquidation or sale of the Blanket Division would be sued to pay
pre-petition indebtedness under the Pre-petition Credit
Facility.  Although the sale excluded accounts receivable and
inventory, Mr. Sudell says, the Final DIP Financing Order refers
only to proceeds from the sale of certain assets.  Thus, the
Debtors want it made clear that the proceeds from the
liquidation of the Blanket Division accounts receivable and
inventory may be applied to the pre-petition indebtedness.

Absent the Fourth Amendment, Mr. Sudell advises Judge Robinson,
the Debtors' access to post-petition financing will terminate on
November 14, 2001.  The Fourth Amendment will enable the Debtors
to continue with their reorganization efforts with the certainty
that post-petition financing is available to them, Mr. Sudell
declares.

With respect to the additional events of default, Mr. Sudell
assures the Court that the deadlines are substantially within
the Debtors' own internal timetable for emergence from
bankruptcy.  The modifications to the covenants are likewise
consistent with the Debtors' strategic plan, Mr. Sudell adds.

The reduction in the commitment from $125,000,000 to
$100,000,000 actually will benefit the Debtors' estates, Mr.
Sudell continues.  Mr. Sudell tells Judge Robinson that since
the Petition Date, the Debtors have borrowed under the Post-
Petition Credit Agreement only once in the amount of
approximately $10,000,000 in December 2000.  Moreover, Mr.
Sudell states, the Debtors currently have approximately
$41,000,000 of cash on hand.  The Debtors simply do not need
access to $125,000,000, Mr. Sudell concludes.  The reduction in
the commitment, Mr. Sudell points out, will reduce the amount of
the Debtors' monthly unused commitment fee.

Thus, the Debtors request Judge Robinson to enter an order:

   (i) authorizing the Debtors to enter into the Fourth Amendment
       to the Post-Petition Credit Agreement and to pay the
       related amendment fee, and

  (ii) clarifying that the Debtors may apply the proceeds from
       liquidation of the Blanket Division accounts receivable
       and inventory to the pre-petition indebtedness.

                Creditors' Committee Howls in Protest

Asserting that the Fourth Amendment seeks an unjustified
improvement in the position of the Debtors' Pre-Petition
Lenders, the Official Committee of Unsecured Creditors objects
to:

   (i) the application of the proceeds from the liquidation of
       accounts receivable and inventory of the Blanket Division
       to pay down obligations under the Pre-petition Credit
       Facility;

  (ii) the increase in the unused commitment fee from 0.50% to
       0.75%, and the corresponding reduction in the commitment
       under the Post-Petition Credit Agreement from $125,000,000
       to $100,000,000;

(iii) the restrictions placed on the Debtors to implement their
       3-year strategic business plan;

  (iv) the awarding of an amendment fee and predetermined waiver
       fees to the DIP Lenders; and

   (v) the undue restrictions placed on the Debtors with respect
       to their preparation of a plan of reorganization.

According to Pauline K. Morgan, Esq., at Young Conaway Stargatt
& Taylor, LLP, in Wilmington, Delaware, the DIP Lenders are
making overreaching efforts to obtain control over the Debtors'
cases to the detriment of the Debtors' estates and their
unsecured creditors.

(A) Proceeds Should Not Be Used to Satisfy Pre-Petition
     Indebtedness

Ms. Morgan says that conditioning the effectiveness of the
Fourth Amendment upon the use of the proceeds to pay obligations
under the Pre-petition Credit Facility is not supported by law
and places the Debtors and their estates in financial jeopardy.
The Final DIP Financing Order only provides that the proceeds
from the sale be applied to payment of pre-petition
indebtedness, Ms. Morgan reminds the Court.  This clearly does
not encompass proceeds from the ordinary course of liquidation
of accounts receivable and inventory, Ms. Morgan points out.
Indeed, Ms. Morgan adds, the Debtors' financial projections have
always contemplated that the proceeds will be retained and used
by the Debtors to satisfy post-petition obligations.

Even assuming that the Debtors and the lenders had agreed that
the proceeds would be used to pay the pre-petition indebtedness,
such agreement was never clearly detailed to this Court, Ms.
Morgan continues.  Moreover, according to Ms. Morgan, such
agreement would have been entered into at a time when the
Debtors believed that they:

     (a) would not have sufficient cash to satisfy their ongoing
         obligations, and

     (b) would therefore have an immediate and continuing need to
         borrow funds under the Post-Petition Credit Agreement.

But the Debtors have essentially been self-funding since the
Petition Date, Ms. Morgan remarks.

According to Ms. Morgan, the steep reduction in the Debtors'
cash would likely force them to borrow funds under the Post-
Petition Credit Agreement in the near term and, thereby, incur
significant interest expense.  If the Fourth Amendment is
approved, Ms. Morgan notes, the interest rate for borrowings is
to increase by 0.50%.  Requiring the Debtors to make such
payments would cause additional burden on the Debtors' current
financial woes and, at the same time, provide the DIP Lenders
with more income at the Debtors' expense, Ms. Morgan contends.

The application of the proceeds could also cause the Debtors to
violate certain financial covenants under the Post-Petition
Credit Agreement, such as the Asset Coverage Ratio, Ms. Morgan
continues.  Upon such a covenant default, Ms. Morgan predicts,
the DIP Lenders would likely require the Debtors to pay another
waiver or amendment fee in order to modify the applicable
covenant, further depleting the Debtors' cash.

If, as the Lenders say, the pre-petition indebtedness is
undersecured, then its repayment would not be prudent, Ms.
Morgan tells Judge Robinson.  Applying the proceeds to pre-
petition indebtedness would be favoring one unsecured creditor
over another, which is contrary to the equitable principles of
the Bankruptcy Code, Ms. Morgan states.  And even if the Lenders
assert that the Pre-petition Lenders are oversecured, Ms. Morgan
advises, the Creditors' Committee has potentially viable causes
of action to avoid a significant portion of the Pre-petition
Lenders' liens, which would then render them either undersecured
or unsecured.

Ms. Morgan further contends that using the proceeds to satisfy
the pre-petition indebtedness would also be at odds with the
provisions of the Final DIP Order which limited the "roll-up" of
the pre-petition obligations into post-petition obligations to
$150,000,000.  According to Ms. Morgan, the Creditors' Committee
consented to the cap largely because the Post-Petition Credit
Agreement provided for $150,000,000 in credit to be made
available to the Debtors.  And yet, if approved, the Fourth
Amendment would reduce the facility to $100,000,000, Ms. Morgan
notes.  Transferring the proceeds to the Pre-petition Lenders
grants them a windfall at the expense of the Debtors' estates
and their unsecured creditors and should not be permitted, Ms.
Morgan declares.

(B) The Fee Increases and Lowering of the Commitment Do Not
     Benefit the Debtors

Contrary to the Debtors' assertions, Ms. Morgan tells the Court
that the reduction in the commitment under the Post-Petition
Credit Agreement from $125,000,000 to $100,000,000 would not
benefit the Debtors' estates.  The Debtors are currently
required to pay an unused commitment fee of 0.50% on
$125,000,000, Ms. Morgan explains, which corresponds to a
monthly payment of $52,083 or $625,000 per year.  But upon the
approval of the Fourth Amendment, Ms. Morgan calculates, the
Debtors would be required to pay the DIP Lenders $62,500 per
month and $750,000 per year due to an increased 0.75% unused
commitment fee on $100,000,000.

(C) The Fourth Amendment Prevents the Debtors from Implementing
     the Business Plan

According to Ms. Morgan, the Fourth Amendment seeks to prevent
the Debtors from implementing their Business Plan by limiting
the Debtors' restructuring expenditures.  Neither the DIP
Lenders nor the Pre-petition Lenders should be permitted to
control the business, Ms. Morgan asserts.  The net effect of
preventing the implementation of the Business Plan, Ms. Morgan
complains, would be that the Debtors' unsecured creditors will
have funded the preparation of the Business Plan, while the Pre-
petition Lenders and the DIP Lenders will seek to reap all the
rewards for themselves when the Business Plan is implemented
after the Debtors emerge from chapter 11.

The only restrictions that should be placed on the Debtors in
implementing the Business Plan should be that they consult with
their primary creditor constituencies and obtain the approval of
this Court prior to taking any action outside the ordinary
course of business, Ms. Morgan adds.  In that regard, Ms. Morgan
says, any other provisions of the Fourth Amendment that would
limit implementation of the Business Plan should be revised to
prevent covenant defaults.

(D) The DIP Lenders Should Not Be Granted Fees In Connection
     With The Fourth Amendment or Any Subsequent Amendments

The DIP Lenders have found different ways to extract fee after
fee from the Debtors, the Creditors' Committee complains, and
the Pre-petition Lenders are making a career of extracting fees
from a faltering Pillowtex.  Ms. Morgan lists the post-petition
fees received by the Lenders to date:

     (a) an ongoing unused commitment fee, which the DIP Lenders
         are seeking to increase;

     (b) an agency fee of $5,000 per month;

     (c) a facility fee of 0.50% of the initial amount of the
         facility provided under the Post-Petition Credit
         Agreement ($150,000,000);

     (d) letter of credit fees;

     (e) $250,000 in connection with the First Amendment; and

     (f) in later August, $973,500 in connection with the Third
         Amendment.

Now, Ms. Morgan says, the DIP Lenders are seeking another
$500,000 from the Debtors in connection with the Fourth
Amendment, an amendment that the DIP Lenders knew would be
required when the Third Amendment was entered into less than 3
months ago.

According to Ms. Morgan, the Fourth Amendment is structured to
virtually assure the payment of additional "waiver" fees of
$500,000 per "waiver."  It is rare for a credit agreement to
stipulate the amount of a waiver fee before a default has even
occurred, Ms. Morgan relates.  But the way the facility is being
amended, Ms. Morgan says, it is highly probable that the Debtors
will breach certain financial covenants and other terms and be
forced to obtain additional waivers and/or amendments.  The
Fourth Amendment is intentionally structured this way to assure
the DIP Lenders of a continuing stream of waiver fees, Ms.
Morgan accuses.

"The Creditors' Committee acknowledges that the DIP Lenders are
in the business of making money and are not charitable
organizations," Ms. Morgan says.  Nevertheless, Ms. Morgan
contends, to continue to enable the DIP Lenders to extort fees
for amendments they know are going to be required when a prior
amendment is entered into is unconscionable.

(E) The DIP Lenders Should Not Be Permitted to Exert Undue
     Control Over the Plan Process

The DIP Lenders are seeking a de facto transfer of control over
the Debtors' exclusive right to control the plan process and, in
effect, over the Debtors themselves, Ms. Morgan tells Judge
Robinson.  The Creditors' Committee is concerned that the
artificially imposed deadlines could prevent the Debtors from
reviewing and considering a number of fiscal and operational
alternatives that would maximize value for the Debtors' estates
and all of their creditors.  The Fourth Amendment also provides
that it would be an Event of Default if the Plan does not
provide for the cash payment of all administrative expenses, Ms.
Morgan adds.  To the extent a third party is willing to accept
treatment other than payment in cash on account of its
administrative expenses, the Debtors should be free to negotiate
such alternative treatment, Ms. Morgan insists.

Thus, the Creditors' Committee urge Judge Robinson to deny the
Debtors' motion.

                         *   *   *

While the Debtors believe it is important to have DIP financing
in place, there is no critical need at this moment.  At the
present time, there are no borrowings under the DIP Facility and
the Debtors don't see an urgent need to draw on the facility
within the next few weeks.  Moreover, the Debtors have
sufficient cash on hand to fund their working capital
obligations for the next few weeks.  Accordingly, to allow Judge
Robinson time to sort through the Committee's objections, the
DIP Lenders agree to continue backing outstanding letters of
credit and otherwise maintain the status quo through the time
Judge Robinson can convene a hearing on the Fourth DIP Financing
Amendment. (Pillowtex Bankruptcy News, Issue No. 17; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


POLYMER GROUP: Onerous Debt Levels Prompt S&P to Cut Ratings
------------------------------------------------------------
Standard & Poor's lowered its ratings on Polymer Group Inc. All
ratings remain on CreditWatch with negative implications, where
they were placed on March 14, 2001.

The downgrade reflects heightened concerns related to the
company's near-term financial flexibility, onerous debt levels
and the continuation of unfavorable business conditions. Polymer
has been operating under a waiver of the financial covenants
contained in its bank facility that is due to expire, if not
amended further, on December 29, 2001. Failure to renegotiate
these terms would trigger a breach of certain financial
covenants, including leverage and fixed charge coverage tests,
resulting in a default of the terms of the bank facility
(Polymer's November 5, 2001, announcement of restructuring
charges will likely result in a further breach of a minimum net
worth covenant). These issues could result in the acceleration
of the company's outstanding bank debt if not waived or amended,
and heighten the risk of a default related to the firm's
outstanding subordinated notes even if the bank loans are
extended.

This action also reflects acknowledgement that Polymer's
initiatives to reduce debt during the current year through asset
dispositions or other strategic actions have not been successful
to date, and may prove more difficult than previously
anticipated due to challenging credit market and economic
conditions.

During the past year Polymer's profitability and cash flow have
deteriorated as a result of elevated raw material costs
(primarily polypropylene resins) and industry overcapacity that
has limited the firm's ability to pass on resin cost increases
to customers. Reduced contribution from higher-margin products
in the consumer group, and slower-than-anticipated contribution
from new product initiatives have also contributed to the weaker
results.  Significantly, these operating difficulties follow a
period of rapid expansion, much of it debt financed, and have
resulted in the meaningful deterioration of key financial
measures and financial flexibility.

Polymer is one of the world's largest nonwoven and oriented
polyolefins producers. The firm's woven and non-oven plastic
fabrics are used in an array of consumer and commercial
products; primary uses include facing for diapers and other
hygiene products, specialty and industrial fabrics, disposable
surgical gowns, and wipes for use in consumer, industrial, and
food service applications.

Standard & Poor's will resolve the CreditWatch once additional
information is available regarding the company's actions to
improve its operating performance and financial flexibility.

           Ratings Lowered and Remaining on CreditWatch
                    with Negative Implications

                                              Ratings
      Polymer Group Inc.                 To               From

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


RELIANCE GROUP: Taps Latham & Watkins as Special Tax Counsel
------------------------------------------------------------
Reliance Group Holdings, Inc., asks Judge Gonzalez to allow
Latham & Watkins to provide legal services as special tax
counsel.  Irving Salem, Esq., of Latham & Watkins, submits an
affidavit outlining the request.

Mr. Salem tells Judge Gonzalez that he has been practicing
Federal income tax law for 42 years, with particular emphasis on
consolidated return matters.  He led the Treasury/IRS task force
in rewriting the consolidated return regulations published in
1966, has headed the affiliated group sections of the ABA and
the NYSBA and has written numerous articles on consolidated
returns.

Mr. Salem explains to the Court that for a number of years, he
has provided RGH with tax advice on several Federal income tax
issues.  The only current matter is a consolidated return
dispute, which commenced, in early 2000.  The IRS has challenged
RGH's deduction for losses with respect to the sale of a
subsidiary, pursuant to the so-called "loss-disallowance"
regulations.  The case is pending at the Appeals Division of the
IRS.  L&W currently represents the Debtors', their subsidiaries
or affiliates, and/or their past or present officers and
directors only in the above described consolidated return issue.
In no case does it represent any party with interests currently
adverse to the Debtors.

L&W is currently representing approximately 15 clients adverse
to RIC in matters that relate to claims or litigation against
RIC.  L&W has obtained a conflict waiver from RGH with respect
to such representations.

L&W has no pre-petition claim against the Debtors other than
unbilled time charges of $9,626 and unbilled expenses of $41.88
related to the pending tax audit of the consolidated return
issue.

L&W intends to apply for compensation for professional services
rendered at its customary hourly rates and for reimbursement of
expenses.  Mr. Salem states that he is the principal attorney
designated to represent the Debtors and his current hourly rate
is $600.  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, L&W meets the legal definition
of a disinterested party. (Reliance Bankruptcy News, Issue No.
15; Bankruptcy Creditors' Service, Inc., 609/392-0900)


SHARED TECHNOLOGIES: Chapter 11 Filing Delays 10-Q Completion
-------------------------------------------------------------
Shared Technologies Cellular Inc. has informed the SEC that the
information necessary to complete Form 10-Q was not available in
a timely manner due to time constraints caused by the Company
filing a voluntary petition for relief under Chapter 11 of Title
11 of the United States Code in the United States Bankruptcy
Court for the District of Connecticut on September 28, 2001.  As
a consequence the filing of the Company's financial information
will be delayed.


TELIGENT INC: Court Okays Further Restructuring of Operations
-------------------------------------------------------------
Teligent, Inc., a Delaware corporation, has been restructuring
its operations to attract funding from investors and/or
purchasers to keep all of its current businesses operational.
Due to the Company's inability to attract a suitable investor
and/or purchaser in the timeframe anticipated, the Company is
taking steps to further restructure its operations.

On November 14, 2001, the Bankruptcy Court for the Southern
District of New York authorized the Company to substantially
reduce its workforce as necessary, file regulatory applications
and notices regarding the discontinuance of certain services to
a substantial number of customers in eleven markets, and issue
notices to such affected customers. The Company will continue to
provide facilities-based private line, transport, and wholesale
services as well as resold services in all 74 markets where it
holds fixed-wireless licenses.


TELSCAPE INT'L: Trustee Wants Removal Period Extended to Jan. 22
----------------------------------------------------------------
David Neier, Trustee of Telscape International in their Chapter
11 cases, asks the U.S. Bankruptcy Court for the District of
Delaware for a second extension of the Removal Deadline.

The deadline asked by the Trustee to file removal notices of
related proceedings is on January 22, 2001.

On and after the Petition Date, the Debtors had civil causes of
action and proceedings pending in the courts of various states.
Because the attention of the Trustee and the Debtors' personnel
has been focused primarily on administering their Chapter 11
cases, the Trustee has not had sufficient time to review the
pending actions and proceedings to determine whether he should
seek removal of any of these proceedings. He asserts that it is
most prudent and efficient course of action to extend the
Removal Period for the second time.

Telscape International is a leading integrated communication
providers serving the Hispanic markets in the United States,
Mexico and Central America, offering local and long distance
telephone, internet and pre-paid calling card services. The
Company filed for Chapter 11 petition on April 27, 2001 in the
District of Delaware. Brendan Linehan Shannon at Young, Conaway,
Stargatt & Taylor and Victoria Watson Counihan at Greenberg
Traurig, LLP represent the Debtors in their restructuring
efforts.


TRUMP HOTELS: Continues Attempts to Renegotiate Public Debt
-----------------------------------------------------------
Cash flows from operating activities are Trump Hotels & Casino
Resorts (THCR) principal source of liquidity. Although THCR and
its subsidiaries anticipate having sufficient liquidity to meet
their obligations during 2001, management cannot make any
assurances regarding THCR's and its subsidiaries' ability to
make future payments in light of the economic consequences of
the September 11th terrorist attacks on the World Trade Center
which have led New York State to approve the largest gambling
package in its history, which includes six casinos, three of
which will be ninety minutes away from Manhattan in the
Catskills, and video slot machines at numerous racetracks,
including Aqueduct in New York City and Yonkers.

Cash flow is managed based upon the seasonality of the
operations. Any excess cash flow achieved from operations during
peak periods is utilized to subsidize non-peak periods when
necessary.

On October 31, 2001, THCR announced that it is seeking to
negotiate the terms of the public debt and is withholding
interest payments thereon until such time as discussions between
THCR and the bondholders have been finalized. The following debt
issues of THCR and/or its subsidiaries are affected:

       (i) THCR Holdings and THCR Funding 15-1/2% Senior Secured
Notes due 2005, having a semi-annual interest payment due on
December 15, 2001;

      (ii) each of Trump AC and (A) Trump Atlantic City Funding,
Inc., (B) Trump Atlantic City Funding II, Inc. and (C) Trump
Atlantic City Funding III, Inc. 11-1/4% Mortgage Notes due 2006,
having an aggregate semi-annual interest payment of $73,125,000
which was due on November 1, 2001;

     (iii) Castle Associates and Castle Funding 10-1/4% Senior
Notes due 2003, having a semi-annual interest payment of
approximately $3,178,000 which was due on October 31, 2001;

      (iv) Castle Associates and Castle Funding 11-3/4% Mortgage
Notes due 2003, having a semi-annual interest payment of
approximately $14,226,000 due on November 15, 2001 and

       (v) Castle Associates and TCHI 10-1/4% Senior Notes due
2003, having a semi-annual interest payment of approximately
$256,000 which was due on October 31, 2001.

THCR is seeking to negotiate the terms of the public debt in
light of the economic consequences of the September 11th
terrorist attacks on the World Trade Center. THCR intends to pay
interest upon the completion of a successful negotiation.

Gaming revenues are the primary source of THCR's revenues. Table
games revenues represent the amount retained by THCR from
amounts wagered at table games (table game drop). The table win
percentage tends to be fairly constant over the long term, but
may vary significantly in the short term, due to large wagers by
"high rollers". The Atlantic City industry table win percentages
were 15.1% and 16.1% for the three months ended September 30,
2000 and 2001, respectively.

Table games revenues decreased $12.5 million or 11.2% to $98.8
million for the three months ended September 30, 2001 from
$111.3 million in the comparable period in 2000. Decreased table
drop at all four properties primarily contributed to the
decrease in revenues. Trump Taj Mahal Casino Resort, the Trump
Plaza Hotel and Casino and Trump Indiana had increased win
percentages in 2001 which primarily offset their respective
decreases in table drop. Trump Marina's decrease is due to
declines in both table drop and win percentage. Slot revenue
decreased $1.9 million or 0.8% to $238.0 million for the three
months ended September 30, 2001 from $239.9 million in the
comparable period in 2000.

Table games revenues decreased $26.6 million or 9.1% to $266.7
million for the nine months ended September 30, 2001 from $293.3
million in the comparable period in 2000. Decreased table drop
at all four properties primarily contributed to the decrease in
revenues. Trump Plaza had increased win percentages in 2001
which primarily offset its decrease in table drop. The Taj
Mahal and Trump Marina's lower table win percentage also
contributed to its lower table win.

Slot revenues increased $6.8 million or 1.0% to $661.0 million
for the nine months ended September 30, 2001 from $654.2 million
in the comparable period in 2000. Increased slot handle of
$149.1 million at the three Atlantic City casinos, due to
innovative marketing initiatives and sustained programs designed
specifically for the slot player, primarily contributed to the
increase in revenues. Trump Indiana's slot revenues in 2001
increased $3.2 million or 4.5% from the comparable period in
2000 due to a 0.7% increase in hold percentage, which totally
offset a $66.7 million or 6.0% decrease in slot handle from the
comparable period in 2000.

Net income for the three months ended September 30, 2001 was
$9.5 million as compared to net income of $ 9.0 million for the
same three months of 2000.  Net loss for the nine months ended
September 30, 2001 was $15.1 million as compared to the net loss
of $12.4 million for the same nine months of the year 2000.


USG CORP: Panel Asks Court to Modify Securities Trading Order
-------------------------------------------------------------
The Official Committee of Unsecured Creditors of USG
Corporation, through Michael R. Lastowski, Esq., asks Judge
Newsome to modify the Order Permitting Securities Trading Upon
the Establishment of an Ethical Wall dated October 22, 2001.
The Committee asks that the Order be clarified, reconsidered or
even vacated in response to a few key details, which remain
unclear.

The Committee explains that though it requested permission (for
itself and certain financial institutions) to trade in the
Securities of the USG Group, it did so out of an abundance of
caution and not out of the belief that such trading in
Securities is prohibited absent a Court Order.

During the September 20, 2001 hearing, the Court voiced concerns
about the proposed order.  In response, the Committee offered to
file a revised proposed order that would be more closely -- in
line with a similar order entered by Judge Farnan in Armstrong
Industries' chapter 11 case -- provide that the order did not
apply to trade claims and include language that would further
state that Committee Members could not trade "trade claims."
The Committee believed these changes were in line with what was
discussed at the hearing and offered transcripts of the related
exchanges between the Court and the Committee.

Judge Farnan's Order, which was referred to in the hearing
transcripts included language which permitted Committee members
to trade in Armstrong's "stock, notes, bonds, debentures,
participation in any of the Debtors' debt obligations or other
claims not covered by Bankruptcy Rule 3001(e)" upon the
establishment and implementation of ethical walls.  The
Armstrong Order does not permit, authorize or otherwise address
other types of claims, i.e. trade claims, but it doesn't forbid
them, either.

The addition of the phrase "applicable financial institutions"
is the only difference between the Armstrong Order approved by
Judge Farnan and the relief requested by the Committee in the
Trading Motion and referred to during the hearing.  The
introduction of "applicable financial institutions" was supposed
to expand the relief requested to include non-Committee
financial institutions and bank group members to trade in USG's
"Securities" if they too establish and implement ethical walls.

The Committee's revised proposal contained an additional
paragraph:

       ORDERED, that this Order shall not apply to the trading of
trade claims and that the Committee Members shall be prohibited
from purchasing and selling trade claims;

On October 22, 2001, the Court signed the Order after changing
the paragraph to read:

       Ordered, that this Order shall not apply to the trading of
trade claims and that the Committee Members shall be prohibited
from purchasing and selling bankruptcy claims;

The Committee wishes the Court to clarify the term "bankruptcy
claims" which is not defined in the Order and is ambiguous in
the context of the remainder of the Order.  The Committee
requests that the Court clarify the Order to make it clear that
it permits the trading of claims based on the Debtors'
Securities after the establishment of ethical walls, but
prohibits trading of all other types of claims, i.e. trade
claims, etc.

If the Court truly intended to prohibit Committee Members from
trading all types of claims while serving on the Committee,
including Securities-based claims, the Committee requests the
Court reconsider the Order in light of the type of relief
offered in the Armstrong Order, which allows the trading of
Securities, if proper ethical walls are established.

Lastly, if the Court doesn't want to clarify or modify the Order
as requested, the Committee asks that the Order be vacated as
the entered Order grants relief irrelevant to the relief sought
by the Trading Motion. (USG Bankruptcy News, Issue No. 13;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


VAIL RESORTS: S&P Rates $100MM Senior Subordinated Notes at B
-------------------------------------------------------------
Standard & Poor's assigned its single-'B' rating to Vail
Resorts, Inc.'s proposed $100 million senior subordinated notes
due in 2009. Net proceeds will be used to repay a portion of
indebtedness under the company's credit facility.

The ratings on Vail reflect good operating performance and a
diversified revenue mix, offset by limited geographic diversity
and the risks associated with operating in a highly seasonal and
cyclical industry. Financial risk is high, as weather patterns
can cause meaningful cash flow swings.

A weaker operating environment and increasingly challenging
business fundamentals are likely for fiscal 2002. Material
declines in leisure travel combined with economic uncertainty as
a result of the Sept. 11, 2001, attacks in the U.S., are
expected to negatively affect financial performance in the near
term. Longer-term visibility is poor, as skier visitation
trends--a key driver of profitability--could be pressured by
slowing economic conditions, softening demand for discretionary
leisure activities, and security issues related to travel.
Almost half of Vail's past customers drove to the company's
resorts, somewhat mitigating the business risk associated with
the current economic and political uncertainties. International
skier visits, approximately 10% to 15% of the total, are more
vulnerable, and tend to generate higher revenue per day.

Financial performance is vulnerable to changing weather
patterns. The company has some cushion to absorb weaker skier
visitation trends, but a decline in skier visits that exceeds
expectations, as a result of either tough operating conditions
or poor snowfall, could lead to a ratings downgrade.

Vail is an owner and operator of four main ski resorts in
Colorado (Vail, Beaver Creek, Keystone and Breckinridge) and
resorts in Jackson Hole, Wyoming, and maintains a portfolio of
real estate around its resorts. The company's Jackson Hole
resorts contribute important geographic and operating diversity.
The properties achieve peak revenues from April to November,
offsetting some of the ski business seasonality by increasing
the portion of Vail's revenues derived from summer activities to
more than 20% of total revenue. Ongoing acquisition activity is
a positive from a business risk perspective, helping to reduce
the company's weather dependence and seasonality, and improving
geographic and revenue diversity. However, Vail's expansion in
the hospitality segment increases its exposure to economic
uncertainty and current travel-related issues.

Skier visits have been flat across the industry, and the sector
went through a period of consolidation in the mid-1990s. Still,
the industry remains highly fragmented. Consolidation activity
has slowed, as the leading players are focused on investment
opportunities at existing resorts and acquisitions that reduce
the risks inherent in the ski business. Vail is well-positioned,
with 9% share of the U.S. skier market and more than 40% of the
Colorado ski market.

Improvements in operating performance in fiscal 2001 reflected a
return to more normal ski conditions, following a few years of
unfavorable weather patterns that negatively affected the
financial performance of the ski industry's leading operators.
For the fiscal year ended July 31, 2001, EBITDA plus rent
expense coverage of interest plus rent expense was about
3.2 times compared with 2.9x in fiscal years ended 2000 and
1999, respectively, and 5.5x in fiscal 1998. EBITDA margins are
about 23%. Amid the economic downturn and uncertain impact on
revenue growth, management is exercising disciplined cost
control. Lack of revenue visibility and the potential impact on
margins and profitability remain major concerns in the near
term.

At July 31, 2001, total debt to EBITDA was about 3x. Financial
flexibility benefits from borrowing availability under the
company's $421 million credit facility. Capital spending for
resort operations is expected to be modest in 2002. Maintenance
requirements are lower than budgeted capital spending, providing
an additional degree of flexibility. Acquisitions of high
quality, winter or summer resorts are likely in the near term.

                         Outlook: Negative

The ratings could be pressured if financial performance weakens
due to declining skier visits, further slowing in economic or
travel trends, unfavorable weather patterns, or increasing
competitive pressures, that cause key credit measures and
financial flexibility to deteriorate.


WARNACO GROUP: Gets Nod to Implement Key Employee Retention Plan
----------------------------------------------------------------
According to Kelley A. Cornish, Esq., at Sidley, Austin, Brown &
Wood, in New York, New York, The Warnaco Group, Inc., and its
debtor-affiliates have re-examined each of the employees to be
eligible to participate in the Retention Plan, along with their
categorization and treatment under the Retention Plan.  As a
result, Ms. Cornish tells the Court, the Debtors have determined
that the Retention Plan should cover a total of 245 employees,
rather than 233.  "This adjustment reflects among other things,
the elimination of certain participants due to their departure
from employment with the Debtors, and the addition of other
participants," Ms. Cornish explains.  Although there are now 12
more participants covered under the Retention Plan, Ms. Cornish
informs Judge Bohanon, the adjustments result in an overall
reduction in the total potential cost of the Retention Plan of
approximately $2,480,000, principally associated with a
reduction in the overall cost of the Stay Bonuses under the
Retention Plan.

Thus, the Debtors ask Judge Bohanon for authority to implement
the Retention Plan, as amended.

                          *     *     *

After due deliberation, Judge Bohanon concedes that the Debtors
have shown good and sufficient cause for the relief requested in
their motion.  Thus, Judge Bohanon authorizes and empowers the
Debtors to implement and make payments under the Retention Plan.
Judge Bohanon makes it clear that the Debtors are not subject to
any stay in the implementation, enforcement or realization of
the relief granted by the Court order, and the Debtors may, in
their discretion and without further delay, take any action and
perform any act authorized under this Order. (Warnaco Bankruptcy
News, Issue No. 14; Bankruptcy Creditors' Service, Inc.,
609/392-0900)


WEIGH-TRONIX: Talks to Amend Bank Covenants Spur S&P Downgrades
---------------------------------------------------------------
Following heightened concerns about the liquidity of U.S.-based
weighing instrument manufacturer Weigh-Tronix LLC, Standard &
Poor's lowered its long-term corporate credit rating on Weigh-
Tronix to triple-'C'-plus from single-'B'-minus. At the same
time, the senior secured and subordinated debt ratings on
guaranteed related entity SWT Finance B.V. were lowered to
triple-'C'-plus and triple-'C'-minus from single 'B'-minus and
triple 'C', respectively. All ratings remain on CreditWatch,
where they were placed with negative implications on October 10,
2001.

The rating actions reflect the company's current discussions to
amend banking covenants. Weigh-Tronix and its banks are
currently negotiating the terms of a waiver and amendment to its
credit agreement, of which it would otherwise be in violation,
due to the sale of its Berkel North America Slicer Business.

The downgrade also reflects Standard & Poor's heightened
concerns regarding Weigh-Tronix's liquidity. Financial
flexibility has become very constricted, as proceeds from
previously anticipated asset disposals have not yet been
realized, although the company expects to receive them in the
third quarter.

At the end of September 2001, Weigh-Tronix's financial
flexibility consisted mainly of a $50 million revolving credit
facility, of which a significant amount was drawn. Cash and the
unused portion of the revolving credit facility do not allow for
significant deviations from the operating cash flow forecasts.
Without noticeable proceeds from disposals, Standard & Poor's
expects that liquidity will remain tight in the foreseeable
future.  Nevertheless, Standard & Poor's expects Weigh-Tronix to
be able to make the coupon payment of EUR6.25 million ($5.5
million) due December 1, 2001, on the EUR100 million 12.5%
subordinated notes due June 2010.

Weigh-Tronix expects to report sales of $77.4 million and
adjusted EBITDA (excluding unusual and nonrecurring items) of
$8.7 million, giving weak interest coverage of 1.6 times.
Standard & Poor's views Weigh-Tronix's cash flow generation as
weak in the first two quarters of fiscal 2002 ending March 31,
2002. The company is expected to maintain high financial
leverage in the foreseeable future.

Standard & Poor's will continue to monitor Weigh-Tronix's
discussions regarding the bank covenants and its financial
flexibility, particularly in regard to the liquidity situation,
with a view to resolving the CreditWatch status.


WESTERN POWER: Fails to Comply with Nasdaq Listing Requirements
---------------------------------------------------------------
Western Power & Equipment Corp. (Nasdaq:WPEC) announces that it
has received a NASDAQ staff determination indicating that it had
failed to regain compliance with the proxy statement and annual
meeting filing requirements set forth in NASDAQ Marketplace
Rules 4350 (e) and (g), respectively.

The staff determination advised that the Company's securities
would therefore be subject to delisting from the NASDAQ SmallCap
Market. The Company is appealing the staff determination and has
requested a hearing. There can be no assurance that the Panel
will grant the Company's request for continued listing.

The Company has set a record date of December 10, 2001 for its
annual meeting of shareholders and intends to file a preliminary
Notice of Annual Meeting of Shareholders and Proxy with the
Securities and Exchange Commission in the near future and
schedule a shareholder's meeting in the early part of 2002.

Western Power & Equipment Corp. sells, leases, rents, and
services construction, industrial, and agricultural equipment
for Case Corporation and over 30 other manufacturers. The
company currently operates 18 facilities in Washington, Oregon,
northern Nevada, California, and Alaska.


WESTSHORE TERMINALS: Trustees Tap CIBC to Review Alternatives
-------------------------------------------------------------
Westshore Terminals Income Fund (TSE: WTE.UN) announced that the
Trustees have retained CIBC World Markets as a financial advisor
of the Fund to identify opportunities for the Fund to enhance
unitholder value.

No specific transaction has been identified but options to be
considered may include merger opportunities, restructuring of
the Fund and the outright sale of all the assets of the Fund.


WHEELING-PITTSBURGH: Net Loss of $40MM in Sept. Quarter Expected
----------------------------------------------------------------
Wheeling-Pittsburgh Corporation expects that, when filed, the
Form 10-Q Results of Operation will reflect a net loss of
approximately $40.1 million for the quarter ended September 30,
2001, as compared to a net loss of approximately $21.4 million
for the quarter ended September 30, 2000.

In addition, the Company expects to show an Operating Loss of
approximately $37.4 million for the third quarter of 2001 as
compared to an Operating Loss of approximately $19.1 million for
the third quarter of 2000.


WICKES: S&P Lowers Rating a Notch Citing Marginal Cash Flow
-----------------------------------------------------------
Standard & Poor's lowered its corporate credit rating on Wickes
Inc. to single-'B'-minus from single-'B' and lowered its senior
subordinated debt rating to triple-'C' from triple-'C'-plus. The
outlook is negative.

The rating action reflects the company's marginal cash flow and
liquidity, and Standard & Poor's concern regarding the company's
ability to improve operations if lumber pricing remains volatile
and the housing market slows significantly in light of the
weakening U.S. economy.

The ratings on Wickes are based on the volatility of lumber
prices, the company's participation in the competitive building-
material supply industry, marginal cash flow coverage and
liquidity, and high leverage.

Vernon Hills, Illinois-based Wickes is one of the largest
suppliers of building materials in the U.S., operating more than
99 sales and distribution facilities and 26 component
manufacturing facilities in 24 states. The company competes in a
highly fragmented industry that is closely linked to residential
building construction. The industry is cyclical, has substantial
volatility in lumber prices, and can be negatively affected by
adverse weather conditions.

A significant decline in lumber prices, which began in the
second quarter of fiscal 2000, resulted in negative same-store
sales in the first half of fiscal 2001 and the second half of
fiscal 2000. Although the company achieved positive same-store
sales of 4.5% in the third quarter of 2001, EBITDA has continued
to decline, and was $16 million for the first nine months of
2001 versus $25 million for the comparable period in 2000. As a
result, EBITDA coverage of interest is trending below 1.0 times,
compared with 1.8x in 1999. Lumber prices improved somewhat in
the first half of 2001, but pricing has since declined and
Standard & Poor's believes lumber prices will remain volatile
due to the weakening U.S. economy. Although the company has
implemented measures to help reduce costs, these factors may
limit Wickes' ability to significantly improve cash flow.

Financial flexibility is marginal, as Wickes had about $9
million of net availability under its borrowing base revolving
credit facility as of Sept. 29, 2001; the company must maintain
$25 million of excess availability to remain in compliance with
the facility. Although Wickes continues to manage working
capital to maintain availability under its bank facility, debt
maturities of $9 million over the next 12 months could further
pressure the company's liquidity.

                         Outlook: Negative

Standard & Poor's believes Wickes will be challenged to improve
cash flow and liquidity over the next year due to the volatility
of lumber prices and the weakening U.S. economy. A further
decline in cash flow or liquidity could result in a downgrade.


WINSTAR: Court Okays Hiring Carolina Financial as Broker
--------------------------------------------------------
Finding the relief requested necessary and in the best interests
of Winstar Communications, Inc., and their estates, creditors
and other parties-in-interest, Judge Farnan approves the
application to employ and retain Carolina Financial Group as
equity broadcasting broker in these cases effective as of the
commencement date of these cases.

Winstar Communications, Inc. and non-debtor Winstar Broadcasting
Corporation own and control significant debt and equity
interests in Equity Broadcasting Corporation, a private
broadcasting company based in Little Rock, Arkansas. Since March
2001, the Debtors have retained Carolina Financial Group, Inc.,
to market their EBC Assets to more than 40 potential customers.
To date, Carolina's efforts have resulted in a firm commitment
by Sycamore Ventures to purchase around 90,498 shares of EBC
Common Stock.

Under the agreement with Winstar Broadcasting Corp. and the
Debtors:

A. Carolina is entitled to compensation only in the event that
    it successfully arranges a sale of some or all of the
    Debtors' or Equity's EBC Assets. Upon such sale(s), it is
    entitled to receive 5% of the aggregate proceeds from
    equity securities sold and 2.5% of the aggregate sale
    proceeds from debt securities sold.

B. Carolina's engagement is not exclusive, and may be
    terminated by the Debtors or Equity at any time. (Winstar
    Bankruptcy News, Issue No. 18; Bankruptcy Creditors' Service,
    Inc., 609/392-0900)


WORLD AIRWAYS: May Violate Covenant if Losses Continue in Q4
------------------------------------------------------------
For the third quarter ended September 30, 2001, World Airways,
Inc.'s operating revenues were $85.2 million, the operating loss
was $1.7 million, the net loss was $2.3 million.  For the third
quarter ended September 30, 2000, the Company's operating
revenues were $67.5 million, operating income was $1.1 million
and net earnings was $43,000.

For the first nine months of 2001, the Company's operating
revenues were $235.5 million, the operating loss was $17.5
million, the net loss was $21.7 million.  For the first nine
months of 2000, the Company's operating revenues were $192.3
million, the operating profit was $0.1 million and the net loss
before the cumulative effect of a change in the method of
accounting was $2.9 million. Net earnings after the cumulative
effect of the accounting change was $19.3 million.

During the first nine months of 2001, the Company's business
relied heavily on its contracts with the U. S. Air Force's Air
Mobility Command and Garuda Indonesia.  In 2001, these customers
provided approximately 61% and 8%, respectively, of the
Company's revenues and 46% and 11%, respectively, of block hours
flown.  In 2000, AMC and Garuda provided approximately 39% and
12%, respectively, of the Company's revenues and 27% and 15%,
respectively, of block  hours flown.

Because of the September 11th events, the Company does not
expect to fly the 2002 Hadj for security and safety issues. The
Company's service to Air Mobility Command is not expected to be
adversely impacted by the September 11th events.

Total block hours increased 810 hours or 9.6% to 9,221 in the
third quarter of 2001 from 8,411 hours in 2000, with an average
of 13.7 available aircraft in 2001 compared to an average of 10
aircraft in 2000.   Average daily utilization (block hours flown
per day per aircraft) was 7.3 hours in the third quarter of 2001
compared to 9.1 hours for the same period in 2000.

Revenues from flight operations in the third quarter increased
$17.6 million, or 26.2%, to $84.9 million in 2001 from $67.3
million in 2000.  This increase is primarily due to a higher
average yield, or revenue per block hour, as a result of more
full service AMC flying in 2001 compared to 2000, and the
increase in block hours flown in 2001.

Total block hours increased 1,746 hours, or 7.5%, to 25,154
hours in the first nine months of 2001 from 23,408 hours in
2000, with an average of 12.3 available aircraft in 2001 and 10
available aircraft in 2000.   Average daily utilization (block
hours flown per day per aircraft) was 7.5 hours in 2001 and 8.5
hours in 2000. A decrease in cargo ACMI and commercial full-
service flying was more than offset by an increase in block
hours for AMC flying and commercial passenger ACMI flying.

Revenues from flight operations in the first nine months
increased $43.2 million, or 22.5%, to $234.8 million in 2001
from $191.6 million in 2000.  This increase was due primarily to
higher revenue per block hour, principally as a result of
increased flying  under the current 2001 fiscal year contract
with AMC that began October 1, 2000.

The Company is highly leveraged.  At September 30, 2001, the
Company's cash and cash equivalents totaled $3.3 million, which
included restricted cash of  $0.4 million, and the ratio of the
Company's current assets to its current liabilities was 0.6:1.
Also, as of September 30, 2001, the Company had outstanding
long-term debt and capital leases of $41.3 million and notes
payable and current maturities of long term obligations of $16.4
million.

In addition, the Company has significant long-term obligations
relating to operating leases for aircraft and spare engines. At
September 30, 2001, the Company had submitted all of its
available qualified receivables under its Accounts Receivable
Management and Security Agreement and the Company had $7.5
million additional available capacity.

As of September 30, 2001, the Company is in compliance with the
financial covenants in the Company's Accounts Receivable
Management and Security Agreement. However, it is likely that a
loss in the fourth quarter of 2001 together with write-downs
associated with the events of September 11th could cause the
Company to violate its covenants, unless they are modified.

                           *********

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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
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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.

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