TCR_Public/020104.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

              Friday, January 4, 2002, Vol. 6, No. 3


AMF BOWLING: Committee Has Until Monday to Raise Plan Objections
ABRAXAS PETROLEUM: Grey Wolf Gets CDN$150MM in Project Financing
ACTION STEEL: Chapter 11 Case Summary
AMERICA WEST: Will Defer $72 Million of Aircraft Lease Payments
AMERICA WEST: Performance Continues to Improve in November 2001

AMERICAN COMM'L: Taps Greenhill to Review Restructuring Options
ANALYTICAL SURVEYS: Senior Lenders Ink Debt Forgiveness Pact
ASHANTI GOLDFIELDS: Says Debt Workout Talks "Progressing Well"
BURLINGTON: Committee Members Want to Trade Debtors' Securities
CKE RESTAURANTS: Secures $100 Million in Bank Loan Commitments

CLARENT HOSPITAL: Closes Sale of 4 Acute Care Hospitals to HMA
CLARION TECHNOLOGIES: Fails to Meet Nasdaq Listing Requirements
COMDISCO INC: Court Extends Removal Period to April 30
CONSTELLATION 3D: Fails to Comply with Nasdaq Listing Criteria
CONTINENTAL AIRLINES: 2001 Load Factor Slides to 72.4%

COSERV ELECTRIC: Decides to Withhold Debt Payment to CFC
DYNASTY COMPONENTS: Gets Extension of CCAA Protection in Canada
E.SPIRE COMMS: Interland Talks About Acquiring Web-Hosting Units
ENRON CORP: Intends to Sell 51% of Wholesale Trading Business
EXODUS COMMS: Court Approves DIP Financing Facility Amendment

ICG COMMS: Disclosure Statement Hearing Set for February 1, 2002
INDYMAC: S&P Drops Housing Contract Subordinated B-2 Rating to D
INTEGRATED HEALTH: More Time to Decide on Palm Garden Leases
LODGIAN: Court Sets Final Hearing on DIP Financing for Jan. 23
LOEWEN GROUP: Alderwoods Group Rises from Loewen's Ashes

MARINER POST-ACUTE: Gets Okay to Hire Ashby as Conflicts Counsel
MCLEODUSA INC: Will Not Make Jan. Interest Payments on Sr. Notes
METALS USA: Court Approves Proposed Reclamation Claim Procedures
NATIONSRENT: Gets Interim Okay of Investment Deposit Guidelines
NETWORK PLUS: Taps UBS Warburg to Explore Restructuring Options

NEXTEL INTERNATIONAL: Changes Name to NII Holdings, Inc.
NOVO NETWORKS: Units File Amended Plan & Disclosure Statement
PACIFIC GAS: Seeks Preliminary Injunction vs. ORA Director
PACIFICARE HEALTH: Expects $90M in Savings from Improvement Plan
PAXSON COMMS: Launches Senior Sub. Discount Note Offering

PILLOWTEX CORP: Wants Approval to Expand Scope of KPMG's Work
SENIOR HOUSING: Revises Lease Terms with HEALTHSOUTH Corporation
TANDYCRAFTS: Asks for Removal Period Extension through April 11
TELSCAPE: Has Until February 18 to File Schedules & Statements
TRANSIT GROUP: Obtains Court Approval of First Day Orders

U.S. PLASTIC: Inks Agreement to Sell Clean Earth to New CEI Inc.
UPRIGHT INC: Files Joint Plan of Reorganization in California
VENTAS: Will Use Cash & Kindred Shares for 4th Quarter Dividend
VIZACOM INC: Completes Acquisition of SpaceLogix Assets
VLASIC FOODS: Retiree Panel Gets Okay to Hire Heiman as Counsel

W.R. CARPENTER: Files for Chapter 11 Reorganization in Fresno
W.R. CARPENTER: Chapter 11 Case Summary
WHEELING-PITTSBURGH: Lease Decision Period Extended to June 7

* Turnaround Firm JW & Company Opens Offices in Delaware Valley

* BOOK REVIEW: Creating Value through Corporate Restructuring:
                Case Studies in Bankruptcies, Buyouts, and


AMF BOWLING: Committee Has Until Monday to Raise Plan Objections
The Official Committee of Unsecured Creditors of AMF Bowling
Worldwide, Inc., and its debtor-affiliates, sought and obtained
an extension of the deadline to extend objection deadline for
the Debtors' Second Amended Reorganization Plan to December 24,
2001. The Court further orders that the deadline within which
the Debtors, the Pre-petition Agent, and the DIP Agent may
replies thereto is extended to January 7, 2002.

Jonathan L. Hauser, Esq., at Troutman Sanders LLP in Richmond,
Virginia, explains that the predicate to the agreed objection
deadline date of December 20, 2001 was a series of agreements
relating to pre-hearing discovery with the purpose that the
Committee obtain factual information necessary to prepare and
file on a timely basis an objection, and inform the Court of the
grounds for its objection to confirmation of the Plan.
Specifically, the Committee and the Debtors agreed that all
documents requested by the Committee will be produced to the
Committee on November 19, 2001. Additionally, the parties agreed
that the Committee would take the depositions of the Debtors'
factual and expert witnesses during the week of December 3,
2001.  Mr. Hauser submits that the idea behind this schedule was
that the Committee would have approximately two weeks from the
conclusion of depositions to prepare an informed objection.

Notwithstanding the foregoing agreement, Mr. Hauser contends
that the Debtors have, in the most grudging and uncompromising
fashion, delayed production of documents and witnesses.
Specifically, the Debtors have responded to the Committee's
various discovery requests as follows:

A. The Committee's document request response date was agreed to
    be November 19, 2001. Rather than comply with this
    agreement, the Debtors produced no documents before Friday,
    November 23, 2001, the day after Thanksgiving. The balance
    were produced during the week of November 26, 2001.

B. Secondly, the Debtors, rather than produce their witnesses on
    the week of December 3, 2001, have only made the deposition
    of their key expert witness on evaluation, one Arthur
    Newman, available on Friday, December 14, 2001, 6 days
    before the Committee's objection is due. The date for the
    other expert witness employed by the Bank Group will also
    be during the week of December 10, 2001.

Mr. Hauser points out that the foregoing discovery schedule is
in contravention of the agreement of the parties reached on the
date of the Disclosure Statement hearing and is unreasonable. By
its dilatory tactics, the Debtors have allowed the Committee
merely a few business days from the conclusion of depositions to
prepare informed objections to confirmation of the Plan. The
original agreement of the parties contemplated 2 weeks from the
conclusion of discovery until the Committee's objections were
due. (AMF Bankruptcy News, Issue No. 14; Bankruptcy Creditors'
Service, Inc., 609/392-0900)

ABRAXAS PETROLEUM: Grey Wolf Gets CDN$150MM in Project Financing
Abraxas Petroleum Corporation (AMEX:ABP) announced that its
wholly-owned subsidiary, Grey Wolf Exploration Inc., has entered
into an agreement with Mirant Canada Energy Capital Ltd. for a
CDN$150 million (approximately $96 million U.S.) project finance
facility to fund Grey Wolf's development and acquisition
activities in Canada.

The facility will replace Grey Wolf's existing bank facility and
provide funding initially for as many as 45 wells plus
associated land, seismic and infrastructure costs over the next
two years. The facility will be secured by the assets of Grey
Wolf and is non-recourse to Abraxas.

Abraxas' CEO, Bob Watson, commented, "This facility will permit
us to greatly accelerate our development operations in Canada
which will allow us to grow production and reserves at a much
greater rate than would otherwise be possible in the current
environment. In addition to providing an independent
verification of the unbooked upside of our Canadian assets, it
will also provide us with a vehicle to pursue favorable
acquisition opportunities that may become available. This
financing will help further our stated goal to aggressively
develop our existing asset base while maintaining financial

Mirant's Rob Lindermanis, Managing Director, commented, "We are
pleased to expand our relationship with Abraxas into Canada with
the Grey Wolf facility. Grey Wolf has a number of exciting
opportunities and we look forward to participating in their
future growth in Canada."

Abraxas Petroleum Corporation is a San Antonio-based crude oil
and natural gas exploitation and production company that also
processes natural gas. The Company operates in Texas, Wyoming
and western Canada. As at September 30, 2001, the company's
balance was upside-down, with total stockholders' equity deficit
of around $16 million.

Please visit http://www.abraxaspetroleum.comfor the most
current and updated information. The Web site is updated daily
to comply with the SEC Regulation FD (Fair Disclosure).

ACTION STEEL: Chapter 11 Case Summary
Debtor: Action Steel Supply, Inc.
         d/b/a Action Steel-Evansville
         d/b/a Arizona Steel
         d/b/a Goodman Steel
         d/b/a C. Henry Steel
         d/b/a Southside Steel
         d/b/a Steel House
         d/b/a Tube America
         d/b/a Brut Metals
         d/b/a Industrial metals
         d/b/a Prometco
         8301 East 33rd Street
         Indianapolis, IN 46226
         Tel: (317) 897-7283
         Fax: (317) 897-6268

Bankruptcy Case No.: 01-20162-FJO-11

Type of Business: Action Steel Supply is a full line service
                   center specializing in heavy carbon products
                   sold primarily in Indiana, Ohio, Northern
                   Kentucky and Eastern IL.

Chapter 11 Petition Date: December 28, 2001

Court: Southern District of Indiana - Indianapolis Division

Judge: Frank J. Otte

Debtors' Counsel: Jerald I. Ancel, Esq.
                   Sommer & Barnard
                   PO Box 44363, 111 Monument CIR 4000
                   Indianapolis, IN 46244

AMERICA WEST: Will Defer $72 Million of Aircraft Lease Payments
America West Airlines (NYSE: AWA) said it has chosen to defer
payments of approximately $72 million under certain aircraft
leases following the announcement on December 28, 2001, that
the Air Transportation Stabilization Board has conditionally
approved the company's application for federal loan guarantees.

The $445 million loan, of which $380 million is to be guaranteed
by the government, is expected to close by mid-January 2002.
The company anticipates making the aircraft lease payments
within the grace periods allowed under the relevant agreements.

AMERICA WEST: Performance Continues to Improve in November 2001
America West Airlines (NYSE: AWA) reported year-over-year
improvements in operations, including record on-time
performance, for the month of November 2001, as the airline
continued its trend of progress since it initiated sweeping
customer service initiatives in July 2000.

As stated in the U.S. Department of Transportation (DOT) Air
Travel Consumer Report for November 2001 released Wednesday,
America West's system-wide on-time performance was a record 86.0
percent, ranking the airline 5th out of the 11 major airlines
measured, and a dramatic improvement over the 67.5 percent on-
time performance reported in November 2000.  Industry average
was 84.7 percent.

America West's percentage of cancelled flights dropped 86
percent to 0.6 percent in November 2001, ranking the company 4th
out of 11 major airlines, compared to 4.2 percent in November
2000.  The airline also posted a 41 percent improvement in
mishandled baggage, from 5.56 per 1,000 passengers in November
2000 to 3.29 per 1,000 passengers in November 2001, 4th among
the 11 major airlines.  As a result of these improvements,
customer complaints to the DOT declined 63 percent from 4.44 per
100,000 passengers in November 2000 to 1.63 in November 2001.

"We are excited about our dramatic improvement in operations,"
said Douglas Parker, chairman, president and chief executive
officer.  "The progress continues, and we expect our December
results will be even better than November.  The 13,000 employees
of America West plan to continue running a great airline for our
customers throughout 2002."

At Phoenix, where America West is the leading airline and
operates nearly 75 percent of all its flights into or out of Sky
Harbor International Airport, America West's on-time arrival
percentage climbed to 90.9 percent, up from 68.9 percent in
November 2000, ranking it 1st among all carriers serving Sky
Harbor.  The airline's percentage of cancelled flights fell to
.3 percent, compared to 4.1 percent in the year prior, a 93
percent improvement.

America West Airlines, the nation's eighth-largest carrier,
serves 88 destinations in the U.S., Canada and Mexico.  Along
with its codeshare partners, America West serves more than 170
destinations worldwide.  America West Airlines is a wholly owned
subsidiary of America West Holdings Corporation, an aviation and
travel services company with 2000 sales of $2.3 billion.

This press release, as well as releases issued in the past year
by America West Holdings and its affiliates, can be accessed on
the America West Internet site at

AMERICAN COMM'L: Taps Greenhill to Review Restructuring Options
American Commercial Lines LLC (ACL) announced today that it is
reviewing opportunities to restructure its bank and bond debt.

To assist the company in this process, ACL has retained the
investment banking firm, Greenhill & Co., LLC. As ACL considers
its financial restructuring alternatives, the Company's cash
reserves and current revenue generation are more than sufficient
to maintain normal operations, including making timely payments
to all suppliers.

Consistent with its objective to review financial restructuring
opportunities, ACL has been in discussions with its senior note
holders and senior lenders to explore financial restructuring
opportunities. While discussions are ongoing, ACL has elected to
utilize the 30-day grace period provided under the terms of its
senior notes with respect to the $15.1 million interest payment
due on its 10.25 percent senior notes. The interest payment was
scheduled for December 31, 2001. Because ACL's cash reserves are
more than adequate to make the interest payment and maintain
normal business, the Company's decision to continue discussions
with its banks and senior note holders during the grace period
will not impact its day-to-day operations.

"ACL has a solid business. However, it also carries a
significant debt burden. Having operated under the constraints
of that debt for three years, together with unusually difficult
operating conditions in the early part of 2001, and the current
economic climate, ACL has decided to take aggressive action to
comprehensively resolve this issue," said Michael C. Hagan,
president and chief executive officer of ACL. "Following a
financial restructuring, ACL will be better positioned to build
on its eighty-six year history of industry leadership. We are
optimistic that discussions with our banks and senior note
holders will yield positive results for the Company, and expect
that a modified debt package will secure a bright future for
ACL's customers, suppliers and employees."

American Commercial Lines LLC is an integrated marine
transportation and service company operating approximately 5,100
barges and 200 towboats on the inland waterways of North and
South America. ACL transports more than 70 million tons of
freight annually. Additionally, ACL operates marine
construction, repair and service facilities and river terminals.

ANALYTICAL SURVEYS: Senior Lenders Ink Debt Forgiveness Pact
Analytical Surveys, Inc. (Nasdaq: ANLT), a provider of
customized data conversion and digital mapping services for the
geographic information systems (GIS) and related spatial data
markets, announced it has obtained a new Waiver Agreement and
Amendment to its Credit Agreement from its senior lenders.  The
Agreement, which was signed December 28, 2001, results in
substantial debt forgiveness.

The Agreement waives all financial covenant defaults, changes
loan maturity dates and continues principal prepayment
incentives.  Under the Agreement, senior lenders accepted a cash
payment of $1.25 million and non-convertible preferred stock
with a face value of $3.2 million as payment of ASI's $4.4
million line of credit and $6.7 million of its note payable,
which represents a total debt reduction of $11.1 million.  The
Agreement also provides for a remaining $3.0 million note
payable to be reduced to zero with a cash payment of up to
$875,000 by March 31, 2002.

Norman Rokosh, president and CEO, said, "The completion of our
new credit agreement and associated substantial reduction in our
overall debt load represents another significant strategic
accomplishment for our Company.  The prospect of fully
eliminating our current debt for an additional modest cash
payment is one of our most important financial goals for 2002.
We continue to pursue a variety of financing strategies that
will allow us to take full advantage of our debt forgiveness
opportunity and to improve our working capital position."

Rokosh added, "We remain committed to our first operational goal
of delivering valuable services to our customers in a timely,
cost effective manner.  We appreciate the continued support of
our customers, lenders, shareholders and staff as we improve our
balance sheet and operating results."

Analytical Surveys Inc. (ASI) provides technology-enabled
solutions and expert services for geospatial data management,
including data capture and conversion, planning, implementation,
distribution strategies and maintenance services.  Through its
affiliates, ASI has played a leading role in the geospatial
industry for more than 40 years.  The Company is dedicated to
providing utilities and government with responsive, proactive
solutions that maximize the value of the information and
technology asset.  In addition to corporate offices in
Indianapolis, Indiana, ASI maintains several facilities across
the United States and is listed on the Nasdaq under the symbol
"ANLT." For more information, visit

ASHANTI GOLDFIELDS: Says Debt Workout Talks "Progressing Well"
As stated in the announcement of Ashanti's third quarter results
on 30 October 2001, Ashanti has commenced discussions in
relation to a restructuring of the 5.5% Guaranteed Exchangeable
Notes due 2003 with an ad hoc committee of certain holders of
the Notes. These discussions are progressing well.

However, it should be noted that any restructuring of the Notes
would be dependent on reaching agreement with the Ad Hoc
Committee and certain other stakeholders in Ashanti and would be
subject to a number of conditions.

A further announcement will be made, if appropriate, in due

Close Brothers Corporate Finance Limited, which is authorized to
carry on investment business in the UK by the Financial Services
Authority, is acting for Ashanti and no one else in connection
with the restructuring and will not be responsible to anyone
other than Ashanti for providing the protections afforded to
clients of Close Brothers Corporate Finance Limited or for
giving advice in relation to the restructuring.

BURLINGTON: Committee Members Want to Trade Debtors' Securities
The Official Committee of Unsecured Creditors of Burlington
Industries, Inc., and its debtor-affiliates request the Court
for an order determining that those Committee members, acting in
any capacity, engaged in the trading of securities as a regular
part of their business will not have violated their duties as
Committee members by trading in the Debtors' stock, notes,
bonds, debentures, participations in any of the Debtors' debt
obligations, or other claims, including claims of the Debtors'
trade creditors, not covered by Bankruptcy Rule 3001(e) during
the pendency of the Debtors' cases, provided that any Committee
member carrying out such trades establishes and effectively
implements information blocking policies and procedures, to
prevent the misuse of non-public information obtained through
its activities as a Committee member.

Donald J. Detweiler, Esq., at Saul Ewing LLP, in Wilmington,
Delaware, explains that each of the Securities Firms is a
registered investment adviser providing investment advisory
services to institutional, mutual fund, and/or high net-worth
clients.  As an investment advisor, Mr. Detweiler says, each
Securities Firm has a fiduciary duty to maximize returns for its
clients through the buying and selling of securities. As a
result of the Securities Firms' membership on the Committee, Mr.
Detweiler continues, the Securities Firms and their affiliates
also owe a fiduciary duty to other creditors not to divulge any
confidential or inside information regarding the Debtors. Thus,
Mr. Detweiler points out, if a Securities Firm is barred from
trading the Securities during the pendency of these cases
because of such Securities Firm's duties to other creditors,
then such Securities Firm risks the loss of a beneficial
investment opportunity for its clients.  Alternatively, Mr.
Detweiler notes, if any Securities Firm resigns from the
Committee, the interests of its shareholders may be compromised
by virtue of such Securities Firm taking a less active role in
the reorganization process.

According to Mr. Detweiler, other members of the Committee may
also share the same issues and concerns as those of the
Securities Firms.  "The solution to these problems is to allow
those Committee members that adopt certain procedures to trade
in the Securities while remaining productive members of the
Committee," Mr. Detweiler asserts.

Mr. Detweiler explains that the term "Screening Wall" refers to
a procedure established by an institution to isolate its trading
activities from its activities as a member of an official
committee of unsecured creditors in a Chapter 11 bankruptcy
case. A Screening Wall includes, among other things, such
features as the employment of different personnel to perform
each function and physical separation of office and file space,
Mr. Detweiler relates.

The policies and procedures that each Securities Firm will use
to establish its Screening Wall in these cases are:

   (i) Securities Firm Committee personnel shall execute a letter
       acknowledging that they may receive non-public information
       regarding the Debtors and that they are aware of the
       information blocking procedures that are in effect with
       respect to the non-public information and the Securities;

  (ii) Securities Firm Committee personnel will not directly or
       indirectly share any non-public Committee information or
       non-public information concerning these cases with such
       Securities Firm's other personnel (except regulators,
       auditors and designated legal personnel for the purpose of
       rendering legal advice to such Securities Firm Committee
       personnel who shall not share such non-public

(iii) Securities Firm Committee personnel will maintain all
       files containing non-public information received in
       connection with or generated from Committee activities in
       files that are inaccessible to other employees of such
       Securities Firm;

  (iv) Securities Firm Committee personnel will not receive any
       information regarding such Securities Firm's trades in the
       Securities in advance of the execution of such trades,
       other than the usual and customary internal and public
       reports showing such Securities Firm's purchases and sales
       and the amount and class of securities owned by such
       Securities Firm, including the Securities; and

   (v) the compliance department personnel of a Securities Firm
       shall review from time to time the Screening Wall
       procedures to ensure compliance therewith and shall
       maintain records of such review.

"These procedures are meant to exemplify common steps taken to
establish a Screening Wall. They are not meant to be exclusive
of other measures and does not necessarily represent the precise
procedures that a Securities Firm shall institute," Mr.
Detweiler clarifies.

The Committee contends that its members that regularly trade
securities as a regular part of its business should be permitted
to trade in the Securities during the pendency of these cases,
provided that the Committee member establishes Screening Wall
procedures Committee requests that the Court enter an order:

   (i) approving the proposed information blocking procedures;

  (ii) determining that any Committee member, acting in any
       capacity, that engages in securities trading as regular
       part of its business will not have violated its duties as
       a Committee member, and, accordingly, will not subject its
       claims to possible disallowance, subordination, or other
       adverse treatment, by trading in the Securities during the
       pendency of these cases, provided, however, that such
       Committee member follows procedures substantially as set
       forth herein to separate its trading activities from its
       Committee related activities; (Burlington Bankruptcy News,
       Issue No. 5; Bankruptcy Creditors' Service, Inc., 609/392-

CKE RESTAURANTS: Secures $100 Million in Bank Loan Commitments
CKE Restaurants, Inc., (NYSE: CKR) announced it has received
loan commitments for an amended $100 million senior secured
revolving credit facility to replace the Company's $120 million
revolving facility which matures on February 1, 2002.  The
participants are the agent banks in the present facility and
include BNP Paribas as Agent, FirstBank and Trust, Wells Fargo
Bank, Fleet National Bank and U.S. Bank.  The amended facility,
expected to close this month, is for a two-year term, and is
extendable to five years under certain circumstances.

Dennis Lacey, CKE's Executive Vice President and Chief Financial
Officer, stated: "We are very pleased that our core lenders have
taken the time and interest to understand our business and the
turnaround that management of the Company is undertaking.  This
financing is a critical piece of our strategic plan which
provides for growing our principal brands, Carls' Jr. and

Andrew Puzder, CKE's President and Chief Executive Officer, went
on to say: "This new financing is particularly gratifying for
me.  When I assumed the CEO position at CKE about one year ago,
the bank situation was our most critical business issue because
we owed our lenders approximately $250 million.  We have repaid
our lenders and continue to make steady progress in returning
the Company to profitability.  This financing is a major
milestone in that journey."

CKE Restuarants, Inc. owns, operates and franchises
approximately 3,400 quick-service restaurants, primarily under
the Carls' Jr. and Hardees brand names.

As reported in the Troubled Company Reporter (Nov. 1, 2001
edition), Standard & Poor's affirmed its single-'B'-minus
corporate credit and senior secured bank loan ratings and
its triple-'C' subordinated debt rating on the company.

According to the report, S&P's ratings on CKE reflected its
participation in the highly competitive quick-service sector of
the restaurant industry, leveraged capital structure, and
weakened credit protection measures. The ratings also took into
account the poor operating performance at its Hardee's
restaurant concept, despite major efforts to revitalize the

The international rating agency also said that the company's
credit protection measures are weak, with EBITDA coverage of
interest expense only 1.5 times, and leverage is high, with
total debt to EBITDA at 3.6x. CKE had $67 million available
under the bank loan as of Aug. 13, 2001.

CLARENT HOSPITAL: Closes Sale of 4 Acute Care Hospitals to HMA
Clarent Hospital Corporation announced that effective January 1,
2002 it has completed the sale to Health Management Associates,
Inc. (NYSE: HMA) of the stock of four subsidiary corporations
owning or leasing four acute care hospitals in four states.  The
Company does not expect to incur a gain or loss on the

A definitive agreement for the sale was previously announced on
November 8, 2001.  The hospitals sold were: 117-bed Lancaster
Community Hospital in Lancaster, California; 129-bed Santa Rosa
Medical Center in Milton, Florida; 85-bed Fentress County
General Hospital in Jamestown, Tennessee; and 176-bed The
Medical Center of Mesquite in Mesquite, Texas.

Part of Clarent's net proceeds have been used to repay
$23,000,000 in outstanding loans under the Tyco Capital (f/k/a
The CIT Group/Business Credit)/G.E. Capital (f/k/a Heller
Healthcare Finance, Inc.) credit facility eliminating all
extension of credit under the facility other than certain
letters of credit.  In addition, the Company will apply net
proceeds to repurchase up to $130 million 11.5% senior notes,
which Clarent will offer to repurchase at 101% of par pursuant
to applicable Indenture provisions.

Robert L. Smith, Chief Executive Officer of Clarent, said, "This
sale has given us the ability to repay all of the Company's
outstanding indebtedness other than capitalized leases.  We
appreciate and applaud the tireless dedication of our physicians
and employees and the patronage of each of the communities these
hospitals have served."

Formerly known as Paracelsus Healthcare, the company is
attempting to emerge from Chapter 11 bankruptcy under its
approved plan of reorganization. Clarent owns or operates four
acute care hospitals in four states, primarily in the south. The
company targets small and midsized markets. After accounting
errors forced it to restate earnings from 1997 forward, the firm
filed for bankruptcy protection. As part of its reorganization
plan, the firm merged into one of its subsidiaries and
reincorporated as a private company with a new name. It also
sold a handful of hospitals to Health Management Associates in
order to pay off debt.

Additional Company information may be accessed through the
Company's website,

CLARION TECHNOLOGIES: Fails to Meet Nasdaq Listing Requirements
Clarion Technologies, Inc. (Nasdaq: CLAR) announced that it has
requested a hearing to appeal a Nasdaq staff determination that
the Company's common stock is subject to potential delisting
from the Nasdaq Small Cap Market.  The Company received a letter
from Nasdaq, dated December 21, 2001, notifying the Company of
Nasdaq's intent to delist the Company January 3, 2002.  The
delisting notification was based on Nasdaq's determination that
the Company has failed to comply with Nasdaq's continued listing
requirements under Marketplace Rule 4310c(2)(B) regarding
minimum tangible net assets and minimum shareholder's equity.

Clarion is appealing the Nasdaq determination and will be
presenting a plan to the Nasdaq for achieving the minimum
continued listing requirements. Under Nasdaq rules, the
delisting will be stayed until the outcome of the hearing.
Consequently, the Company's common stock will remain listed and
will continue to trade on the Nasdaq Small Cap Market.  The
Company understands that a hearing will occur within 45 days of
today's hearing request filing.

The Company intends to vigorously pursue the appeal and present
a plan that it feels will satisfy meeting the listing
requirements.  If the appeal is denied, the Company's common
stock would trade on the OTC Bulletin Board electronic quotation
system, or another quotation system or exchange in which the
shares of the Company's common stock may qualify.  The Company's
shareholders will continue to be able to obtain current trading
information, including last trade bid and ask quotations, as
well as share volume.

William Beckman, President of Clarion Technologies, Inc.
commented, "Clarion has been impacted by many of the economic
and market factors impacting the industries we serve as well as
the markets in general.  We intend to pursue this appeal with
the intent of presenting an acceptable plan to the Nasdaq to
achieve the continued listing requirements.  However, while we
would regret any delisting, we do not believe that such an
occurrence would have any adverse impact on our suppliers,
customers, or employees.  We also believe that the many
advancements made in information technology would allow the
Company's stock to trade in a viable, fair market."

Clarion Technologies, Inc. operates five manufacturing
facilities with a total of approximately 600,000 square feet
located in Michigan, Ohio and South Carolina.  Clarion's
manufacturing operations include approximately 155 injection
molding machines ranging in size from 50 to 5000 tons of
clamping force.  The Company's headquarters are located in Grand
Rapids, Michigan. Further information about Clarion Technologies
can be obtained on the web at
or by contacting James Hostetler, Vice President of Investor
Relations, at 847-490-6063

COMDISCO INC: Court Extends Removal Period to April 30
Comdisco Inc., and its debtor-affiliates now have until April
30, 2002, or 30 days after entry of an order terminating the
automatic stay with respect to the particular action sought to
be removed, to seek the removal of civil actions pending as of
Petition Date. (Comdisco Bankruptcy News, Issue No. 18;
Bankruptcy Creditors' Service, Inc., 609/392-0900)

CONSTELLATION 3D: Fails to Comply with Nasdaq Listing Criteria
Constellation 3D, Inc., (Nasdaq: CDDD) developer of Fluorescent
Multilayer Disc (FMD) and Card (FMC) technologies, announced
that the Company received a Nasdaq Staff Determination on
December 26, 2001 indicating that the Company fails to comply
with the net tangible assets, shareholders' equity, market
capitalization, total assets, total revenue and shareholder
approval of officer and director grants requirements, as set
forth in Nasdaq Marketplace Rules 4450(a)(3), 4450(b)(1) and
4350(i)(1)(A), and that its securities are, therefore subject to
delisting from the Nasdaq National Market.  The Company has
requested a hearing before the Nasdaq Listing Qualifications
Panel to review the Staff Determination.  There can be no
assurance the Panel will grant the Company's request for
continued listing.

The Company anticipates submitting a listing application to the
Nasdaq SmallCap Market.  There can be no assurance that the
Company's common stock will be accepted for quotation on the
Nasdaq SmallCap Market.

The Company is the worldwide leader in the development of high
capacity Fluorescent Multilayer Disc and Card (FMD/C)
technology.  The Company holds or has made applications for 122
worldwide patents in the field of optical data storage, and is
supported by a team of world-class scientists.  Headquartered in
New York City, the Company has additional offices and
laboratories in Texas, Israel and Russia.  More information is
available at

CONTINENTAL AIRLINES: 2001 Load Factor Slides to 72.4%
Continental Airlines (NYSE: CAL) reported a 72.4 percent load
factor for 2001, 2.1 points below last year's load factor.  For
December 2001, Continental reported record domestic,
international and systemwide December load factors of 72.5, 73.0
and 72.7, respectively.  The systemwide December load factor is
1.3 points above the previous record reported for December 2000.

Continental reported a record 82.9 percent on-time arrival rate
and a record 99.8 percent completion factor for the month of
December.  For 2001, Continental's on-time arrival rate, which
counts cancelled flights as delayed, was 80.7 percent and its
completion factor was 97.6 percent.  Excluding cancellations due
to the events of Sept. 11 and subsequent schedule reduction, the
on-time arrival rate was 82.2 percent and the completion factor
was 99.2 percent.

Continental ended 2001 with cash and short-term investments of
more than $1.1 billion, which includes $168 million of deferred
transportation taxes.

In December 2001, Continental flew 4.5 billion revenue passenger
miles (RPMs) systemwide and 6.2 billion available seat miles
(ASMs), resulting in a traffic decrease of 10.6 percent and a
capacity decrease of 12.3 percent versus December 2000.
Domestic traffic was 2.9 billion RPMs, down 10.3 percent from
December 2000, and domestic capacity was 4.0 billion ASMs,
down 11.3 percent from last year.

Lower year-over-year yields mitigated somewhat by higher load
factors resulted in a decrease in estimated systemwide passenger
revenue per available seat mile (RASM) of between 14 and 16
percent for December 2001, as compared to December 2000.  For
the month of November 2001, RASM declined 17 percent as
compared to November 2000.

Continental Express, a wholly owned subsidiary of Continental
Airlines, reported a load factor of 62.3 percent for 2001 and a
record 61.8 percent for December 2001.  The 2001 load factor is
essentially unchanged from the 2000 load factor, and the
December 2001 load factor is 0.4 points above the previous
record in December 2000.  Continental Express flew 280.5 million
RPMs and 454.0 million ASMs in December, resulting in a traffic
increase of 11.3 percent and a capacity increase of 10.7 percent
versus December 2000.

Continental Airlines serves more than 135 US cities and more
than 95 cities. The number 5 US carrier (trailing United,
American, Delta, and Northwest) has hubs in Cleveland, Houston,
and Newark, New Jersey. Continental Micronesia serves the
western Pacific from Guam, and regional carrier Continental
Express serves 70 US cities. Continental code-shares with
airlines such as Air France, Alitalia, and Virgin Atlantic. It
has a major alliance with Northwest Airlines, which includes
code-sharing as well as shared frequent-flyer programs. In the
wake of terrorist attacks in 2001, the airline is paring down
flights and laying off more than 21% of its workforce.

DebtTraders reports that Continental Airlines' 8.000% bonds due
in 2005 (CAL2) are trading between 84.5 and 86.5. See
real-time bond pricing.

COSERV ELECTRIC: Decides to Withhold Debt Payment to CFC
Citing the failure by National Rural Utilities Cooperative
Finance Corporation honor a March 15, 2001, agreement, CoServ
Electric today announced the company has withheld payment of its
regularly scheduled interest and principal payment that was due
to CFC on December 31, 2001.

"We have taken this action because CFC has failed to honor the
terms of the agreement that called for them to provide $15.1
million under a credit facility to fund the operation and growth
of our telephone and cable companies as specified in budgets and
plans CFC had reviewed and approved," said Bill McGinnis,
president and chief executive officer of CoServ Electric. "We
certainly have the funds to make this payment, but it would be
imprudent to do so without first resolving the differences
between our two organizations."

The principal and interest owed December 31, 2001, by CoServ is
approximately $8 million.

"Our position is clear and our reasons are well-founded," said
McGinnis. "We have abided by the terms of the March 15 agreement
with CFC, but CFC has breached that agreement. Starting in
September, CFC ceased funding valid draw requests as established
in our agreement, and further, CFC encouraged us to seek Chapter
11 protection for our telephone and cable companies. When we
sought a resolution to CFC's improper action, CFC filed a
lawsuit seeking to block us from exercising the rights and
remedies set forth in the March 15 agreement. This conduct by
CFC precipitated the filings by our telephone and cable
companies. Moreover," continued McGinnis, "we are in receipt of
a letter from Sheldon Petersen, CFC's Governor and Chief
Executive, that says, ``since September we have been encouraging
you to seek bankruptcy protection for Telecom. Your delay in
doing so, while inexplicable to us, has exacerbated in [sic] the
current situation.' Despite CFC's position stated in this
letter, CFC has claimed a default because the telecom companies
sought Chapter 11 protection. We are in ongoing discussions with
CFC, and it is our desire to resolve this matter quickly."

On November 30, 2001, CoServ sought Chapter 11 protection for
its telephone and cable companies. On December 20, 2001, CoServ
Telecom Holdings announced it had secured Debtor-in-Possession
("DIP") financing from CFC in the amount of $5.4 million.

For nearly 65 years, CoServ has provided dependable, affordable
electric power to thousands of customers in the North Texas
area. In 1998, the company expanded both its service area and
its service offerings to include a broad range of services.
Further information on CoServ is accessible at

DYNASTY COMPONENTS: Gets Extension of CCAA Protection in Canada
Dynasty Components Inc. (TSE:DCI) announced that, the Company
has obtained a 45 day extension of its protection under the
Companies' Creditors Arrangement Act (CCAA) in order to continue
its restructuring process. The effect of the Order is to
continue the stay of proceedings in respect of claims existing
against the Company as at Friday, November, 30, 2001 until
February 12, 2002.

Dynasty Components Inc., headquartered in Kanata, Ontario, is a
leader in connecting suppliers with customers. DCI has been
developing enduring value added relationships between customers
and suppliers in the IT industry since 1985. Recently DCI has
embarked on a new business strategy focused entirely on the
provision of specialized e-procurement and logistics management
services to the Information Technology (IT) industry across
North America. DCI's growth going forward will be driven by its
leading-edge Interactive Parts Ordering System(TM) (IPOS(TM))
technology, a proprietary internet-based logistics management
solution. DCI trades on The Toronto Stock Exchange under the
symbol "DCI". For more information visit our Web site at

E.SPIRE COMMS: Interland Talks About Acquiring Web-Hosting Units
Interland, Inc. (Nasdaq: INLD) confirmed that it is in
negotiations with e.spire Communications Inc. (OTC Pinksheets:
ESPIQ) to acquire certain assets of e.spire's web hosting
subsidiaries, FloridaNet, Inc. and CyberGate, Inc.   Any sale is
subject to procedures established by, and final approval by, the
U.S. Bankruptcy Court for the District of Delaware.

Interland, Inc. (Nasdaq: INLD) is the leading provider of
business-class Web hosting solutions for small and medium
businesses, offering a broad portfolio of standardized Web
hosting, e-commerce, and application hosting services, from
basic Web sites to managed dedicated hosting solutions. The
company manages more than 300,000 paid hosted Web sites.  More
information about Interland can be found at

e.spire Communications, Inc., an integrated communications
provider, offers traditional local and long distance, dedicated
Internet access, and advanced data solutions, including ATM and
frame relay.  e.spire also provides Web hosting, dedicated
server, and colocation services through its Internet subsidiary,
CyberGate, Inc., and its subsidiary ValueWeb.  e.spire's
subsidiary, ACSI Network Technologies, Inc., provides third
parties, including other communications concerns,
municipalities, and corporations, with turnkey fiber-optic
design, construction, and project management expertise.  More
information about e.spire is available at e.spire's Web site,

ENRON CORP: Intends to Sell 51% of Wholesale Trading Business
Enron Corporation's Wholesale Trading Business involves
marketing, and making markets for, energy commodities and
related risk management and financial services.  The Wholesale
Trading Business also includes EnronOnlineTM, the world's
largest e-commerce site for global commodity transactions.
Energy commodities include petroleum, petroleum products,
natural gas, power, metals, coal, crude and liquids, weather,
forest products and steel, energy in any form and commodities
that are derivatives or by-products of any of the foregoing, as
well as any swaps, caps, floors, collars, futures contracts,
forward contracts, options and other derivative instruments,
contracts or arrangements based on any of the foregoing energy
commodities and including, but not limited to, contracts for the
forward delivery of physical output or assets or physical load

Enron Corp., Enron North America Corp. and Enron Net Works LLC,
tell the Court that they have devoted significant effort to
maintaining their workforce and the inherent value associated
with their Wholesale Trading Business.  However, the Debtors
believe it unlikely that they will be able to successfully
maintain the Wholesale Business and its workforce without the
credit support of a substantial financial institution.  The
Debtors are convinced that a joint venture with a third party is
the optimal way to maximize the value of the Wholesale Trading
Business because:

     (1) The Debtors' Wholesale Business relies, to a large
         extent, on the quality of its traders and back office
         personnel. It is imperative that the Wholesale Business
         is sold in a quick and efficient manner to prevent the
         departure of key personnel to the Debtors' competitors
         thereby decreasing the value of the Wholesale Business;

     (2) The risks of the continued ownership of the Wholesale
         Business are substantial because:

          (a) The Debtor Sellers do not have the required capital
              funds to adequately fund its operations;

          (b) Without an on-going enterprise, personnel will
              leave for the Debtor Sellers' competitors; and

          (c) The Debtor Sellers' business will experience a
              significant loss of goodwill because its customer
              base will be irreparably diminished as customers
              leave the dormant Wholesale Business.

After discussing different scenarios with a variety of suitors,
the Debtors have decided that it is in the best interests of
their estates to enter into a joint venture as expeditiously as
possible so that the Wholesale Business can resume its previous
level of operations as quickly as possible.  The "timing is
crucial as, due to the nature of the Wholesale Business, each
passing day jeopardizes the value of one of the Debtor[s']
largest assets which only has significant value as a going
concern," Brian S. Rosen, Esq., at Weil, Gotshal & Manges LLP,
tells Judge Gonzalez.  "It is imperative that the customers of
the Wholesale Business are swiftly provided with the mechanism
to continue their trading activities and each day that the
Wholesale Business is not acting at full capacity is another day
for a competitor to lure customers, and even the Debtor Sellers'
traders, thereby decreasing the value of this business," Mr.
Rosen explains.

Mr. Rosen reminds the Court that Enron's had contact with many
potentially interested parties shortly after Dynegy terminated
the Merger Agreement.  Those negotiations culminated in a set of
Agreements being prepared that structure the Trading Business
Transaction this way:

     (A) Under a [Draft] Contribution Agreement, Enron Corp.,
         Enron North America Corp., and Enron Net Works L.L.C.,
         will contribute their:

          (a) Equipment and Fixed Assets and other tangible
              personal property used in the Wholesale Trading

          (b) Hardware and Software used in the Wholesale Trading

          (c) Information and Records relating to the Wholesale
              Trading Business or relating to Transferred
              Employees; provided, however, Enron can keep copies
              of everything except customer data (other than
              contact data and information), including without
              limitation, historical trade data with respect to
              any customers or personnel history or contract

          (d) Intellectual Property Rights and Know-How and all
              goodwill, if any, relating to the Trading Business,
              including three Patents:
                 Patent Title      Inventors          Serial No.
                 ------------      ---------          -----------
                 Single Party      Louise J. Kitchen  09/895,281
                 Buying & Selling  Jay C. Webb
                 Commodities with  Marcello Romano

                 Buying & Selling  Louise J. Kitchen  09/895,092
                 Goods & Services  Jay C. Webb         and
                 Using Automated   Marcello Romano    PCT/US01/
                 Method & Apparatus                   41239

                and two Trademarks:

                 Mark                                 Serial No.
                 ----                                 ----------
                 ONE STOP ENERGY SHOP                 75-832446
                 PUTTING THE ENERGY INTO E-COMMERCE   75-832534

                and, for no less than 60 days, redirection of all
                Web traffic from,
      , and to
                NETCO's designated Web site address after its
                Commercial Launch;

            (e) permits and licenses;

            (f) Third Party Claims, meaning the rights, claims,
                causes of action, defenses and rights of set-off
                relating to the Acquired Assets or the Assumed
                Liabilities; and

            (g) All real property interests included in the Real
                Property Leases used in the Trading Business; and

            (h) the assignment, transfer and contribution of all
                of Enron's right, title and interest in and to
               (and NETCO shall assume all of Enron's obligations
               under) all Real Property Leases, Personal Property
               Leases, Employment Contracts, Intellectual
               Property Contracts, used in the Trading Business;

           to The New Energy Trading Company, L.P. (NETCO, for
           short, as described in the DIP Financing Documents), a
           Delaware limited partnership that will be set-up by
           Enron's newly-found partner;

       (B) In exchange for its contributions to NETCO, Enron will
           receive $_________ in cash at the Closing and a 49%
           equity interest in NETCO;

       (C) For two years after the Closing, neither the Debtors,
           NETCO or NETCO's 51% owner will seek to discourage any
           trading counterparties of the Wholesale Business from
           continuing to do business with NETCO following the
           Closing Date; or either (i) hire, attempt to hire,
           contact or solicit with respect to hiring, any
           employee of NETCO engaged in the conduct of the
           Wholesale Business, (ii) induce or otherwise counsel,
           advise or encourage any employee of NETCO to leave the
           employment of NETCO or (iii) induce any representative
           or agent of NETCO to terminate or modify its
           relationship with NETCO;

       (D) The Partnership Agreement will contain certain "exit
           rights" for NETCO's partners, including:

         (1) Put/Call Options -- After the fifth anniversary of
             closing, each year the limited partners may put, and
             the general partner may call, up to 1/3 of the
             limited partners' initial partnership interests,
             until all such interests have been purchased;

         (2) Tag-Along and Drag-Along Rights -- If the general
             partner proposes to transfer all of the general
             partner's interest in the limited partnership, the
             limited partners shall have the right to participate
             in such transfer on the same terms and conditions as
             the general partner. If, in connection with a sale
             by the general partner of all of its partnership
             interest, the purchaser of such interest desires to
             purchase all of the interests of the limited
             partnership, then the general partner shall have the
             right to cause the limited partners to sell their
             limited partnership interests to such purchaser on
             the same terms and conditions as the general

         (3) Buy-Back Rights -- At any time prior to the fourth
             anniversary of closing, if:

            (x) NETCO has not distributed a return to the limited

            (y) any class of debt securities issued by NETCO or
                any direct or indirect holder of the general
                partnership interest in NETCO is rated lower
                than BBB+ by Standard & Poor's Corporation or
                Baa1 by Moody's Investors Service, Inc.,
                according to a Draft copy of the Amended and
                Restated Limited Partnership Agreement for The
                New Energy Trading Company, L.P., or

            (z) if, in the good faith judgment of the Debtor
                Sellers, any of the following have occurred:

                 * NETCO ceases to enter into contracts requiring
                   the physical delivery of gas or electric
                   power, or

                 * NETCO ceases to enter into trading contracts
                   for electric power, or

                 * NETCO ceases to enter into trading contracts
                   for natural gas, or

                 * NETCO suffers net attrition of certain key
                   employees of more than 50%, or

                 * NETCO's value at risk utilization is less than
                   $20 million, then the Debtor Sellers shall
                   either have the right to:

                   (1) cause the General Partner to effect the
                       sale of NETCO or

                   (2) repurchase the tangible and intangible
                       assets of NETCO at a specified price.

     (E) NETCO and the Debtor Sellers will execute a Transition
         Services Agreement pursuant to which NETCO will provide
         the Debtor Sellers certain services for the operations
         of their other business units and the Debtor Sellers
         shall provide certain services to NETCO relating to the
         operation of the Wholesale Business.

The Debtors propose to sell the Trading Business in an Auction
process designed to secure fair market value for the Wholesale
Business.  Furthermore, the divestiture of the Wholesale
Business and the nature of the securities to be received will
allow the Debtor Sellers to participate in the upside potential,
which the Debtor Sellers resolutely believe will occur.  The
Debtors submit that the benefits to be derived from all these
Sale-Related Agreements -- avoidance of future economic risk in
the Wholesale Business in exchange for the receipt of fair
market value for the Assets -- warrants this Court's approval of
the Agreements and authorization to consummate the transactions
contemplated therein. (Enron Bankruptcy News, Issue No. 5;
Bankruptcy Creditors' Service, Inc., 609/392-0900)

EXODUS COMMS: Court Approves DIP Financing Facility Amendment
Judge Robinson grants the motion and authorizes Exodus
Communications, Inc., and its debtor-affiliates to enter into
and perform under the Amended DIP Facility. Judge Robinson also
authorizes the Debtors to enter into any non-material amendments
to the DIP Loan Agreement without the need for further notice
and hearing provided that such amendments do not materially and
adversely affect the rights of any creditor, equity holder or
part-in-interest. (Exodus Bankruptcy News, Issue No. 11;
Bankruptcy Creditors' Service, Inc., 609/392-0900)

ICG COMMS: Disclosure Statement Hearing Set for February 1, 2002
In accordance with Bankruptcy Rule 3017(a), ICG Communications,
Inc., and its debtor-affiliates have obtained from the Office of
the Clerk a date and time for the hearing on the adequacy of the
Debtors' Disclosure Statement, which is 2:00 p.m. (prevailing
Eastern Time) on February 1, 2002, with a deadline for filing
objections to the Disclosure Statement of January 21, 2002. (ICG
Communications Bankruptcy News, Issue No. 15; Bankruptcy
Creditors' Service, Inc., 609/392-0900)

INDYMAC: S&P Drops Housing Contract Subordinated B-2 Rating to D
Standard & Poor's lowered its rating on the subordinate B-2
class of IndyMac Manufactured Housing Contract Pass-Thru Trust
1998-2 (IndyMac 1998-2) to 'D' from triple-'C' and removed it
from CreditWatch negative, where it was placed on May 4, 2001.
The ratings on the senior class A (A-2, A-3, and A-4), mezzanine
class (M-1 and M-2), and class B-1, remain on CreditWatch with
negative implications, where they were also placed on May 4,

The lowered rating reflects the likelihood of the investor
receiving timely interest, and the ultimate repayment of
original principal investment. Indymac 1998-2 reported an
outstanding liquidation loss interest shortfall in the amount of
$60,717.87 for the B-2 class on the November 2001 payment

The rating default of the B-2 class is indicative of the poor
performance of the underlying pool of manufactured housing
contracts and high projected cumulative net losses. After 40
months of performance, IndyMac 1998-2 displays a cumulative net
loss rate and a repossession inventory rate that significantly
exceed expectations at 7.07% of the original pool balance and
6% of the current pool balance, respectively. In addition,
recovery rates on liquidated collateral continue to be very low
(21.50% cumulative recovery rate for October 2001) and the
percentage of the collateral pool that consists of receivables
that are 90-or-more days delinquent is significant at 8.03%. In
the third quarter of 1998, IndyMac 1998-2 announced that it was
exiting the manufactured housing originations business. This has
negatively affected its dealer network relationships, and
consequently, its ability to liquidate repossessed collateral at
reasonable recovery levels.

Standard & Poor's previously downgraded the four subordinate
classes in October 2000, while placing the senior classes on
CreditWatch negative. At that time, the B-2 class was downgraded
to single-'B'-minus from double-'B'. In May 2001, Standard &
Poor's downgraded all IndyMac 1998-2  classes due toworse-than-
expected credit performance, at which time, the B-2 class was
downgraded to triple-'C' with CreditWatch negative implications
from single-'B'-minus.

High losses during the last year have reduced the transaction's
overcollateralization ratio to zero and have resulted in the
write down of the B-2 class from its original balance of
$10,327,900.00 to its current amount of $7,318,256.90. The
future liquidation of repossession inventory in conjunction with
IndyMac 1998-2's low recovery rate is expected to further effect
this credit support negatively. Standard & Poor's will continue
to monitor the ratings associated with the remaining classes.

INTEGRATED HEALTH: More Time to Decide on Palm Garden Leases
Previously, Integrated Health Services, Inc., asked the Court to
authorize rejection of certain of the 14 cross-defaulted nursing
home leases between Palm Garden Healthcare, Inc. and each of the
IHS-Subs and to preserve their right to assume or reject each of
the Preserved Leases at an appropriate time in the future
notwithstanding the cross-default provision in the leases. In
the First Rejection Motion, the Debtors sought to reject 5 and
preserve 9 of the leases. In the Second Rejection Motion, the
Debtors sought to reject 9 and preserve 5 of the Leases.

Upon the cross motion of Palm Garden in response to the Debtors'
First Rejection Motion, the Court issued an order which fixed
November 30, 2001 as the date for the Debtors to assume or
reject the 14 Palm Garden leases.

In this motion, the Debtors move the Court, pursuant to sections
105(a) and 365(b) of the Bankruptcy Code and Rule 60(b) of the
Federal Rules of Civil Procedure (the FRCP), as made applicable
to these proceedings by Rule 9024 of the Bankruptcy Rules, and
Bankruptcy Rule 9006, for an order modifying and amending the
previous order and to extend the time for the Debtors to submit
a motion for the assumption/rejection of the five Profitable
Leases until 10 days after the Court's ruling on the issue of
the enforceability of cross-default provisions contained in the

The Debtors tell the Court that the issue over assumption or
rejection of the leases is intertwined with and complicated by a
number of factors. Depending on these factors and what can be
negotiated, the Debtors might keep as few as five, and perhaps
all, of the Facilities.

According to the Debtors' financial analysis, the 14 Facilities
taken as a group are unprofitable under the Leases as presently
written; the Facilities' projected 2002 earnings, taken as a
whole, before interest, taxes, depreciation, and amortization
(EBITDA), was a negative $1,517,010. Thus, if the Debtors were
required to assume all 14 of the Leases collectively, the
Debtors would choose not to do so without significant rent and
other concessions from Palm Garden. In this scenario, the
simultaneous closure/transfer of all of the Facilities would
place a substantial financial and logistical burden on Palm
Garden, which would have to find new operators for each Facility
or alternatively, deal with the potentially devastating effect
of a mass closing.

However, not all of the Facilities are unprofitable: four of the
Facilities (located in Gainesville, Ocala, Vero Beach and West
Palm Beach, respectively) are profitable, and two of the
Facilities (WinterHaven and North Miami Beach, respectively),
are only marginally unprofitable. Five of the Facilities are
Profitable Facilities which the Debtors have continuously
expressed a serious interest in keeping.

What has complicated the Debtors' ability to divest the
unprofitable Facilities in the Palm Garden portfolio is the
presence of a cross-default clause in each of the Leases. The
Debtors take the position that these clauses do not, and cannot,
restrain the Debtors from selecting which Leases they wish to
assume, and in any case, that such provisions are unenforceable
as a matter of law.

Palm Garden disputes these contentions and maintains that the
Debtors must assume or reject all fourteen of the Leases as a

If the Court were to rule in the Debtors' favor and find that
the cross-default provisions are unenforceable, then the Debtors
would assume some but not all of the Leases, unless Palm Garden
were willing to renegotiate their terms. However, if the Court
were to rule in Palm Garden's favor and hold that the cross-
default provisions in the Leases are enforceable, the Debtors
would most likely reject all of the Leases unless Palm Garden
were willing to renegotiate those Leases.

Given these results, there is clearly room for the Debtors and
Palm Garden to conclude long-standing negotiations. As recently
as December 3 of this year, the parties were actively
negotiating terms under which the Debtors might keep the nine
unprofitable Facilities whose Leases the Debtors previously
moved to reject.

Complicating these issues is the fact that many landlords who
financed their facilities during boom times have found
themselves saddled with debt service on mortgages which leaves
them with little room for rent concessions. The ensuing
negotiations concerning the disposition of unprofitable
facilities are often protracted, extensive and time-consuming,
and frequently take months to conclude.

For the Debtors, the task of deciding what to do with an
unprofitable facility is a sensitive one which requires the
Debtors to balance significant financial, legal, and social
issues, given the unique and important role which healthcare and
nursing home facilities play in their communities, with the duty
owed to the Debtors' creditors to maximize the value of the
estates' assets.

               Actions Taken and the Dates Involved

Palm Garden filed its objection to the Debtors' First Rejection
Motion, and cross-moved for an order pursuant to section
365(d)(2) of the Bankruptcy Code setting November 30, 2001 as
the date by which the Debtors would be required to assume or
reject all of the Leases. Palm Garden requested, inter alia,
that "the Debtors' [First Rejection Motion] be denied unless the
Debtors are required to assume or reject all 14 leases or, in
the alternative, if the court authorizes the Debtors to 'cherry
pick' the 5 leases, the Debtors be ordered to move to assume
those it wishes to retain and move to reject those it wishes to
reject by no later than November 30, 2001." Palm Garden asserted
that a November 30 deadline was necessary because Palm Garden
needed to know which of the remaining nine Leases the Debtors
intended to assume by the end of 2001, in order for Palm Garden
to obtain timely renewals or extensions of letters of credit
which are allegedly due to expire in April, 2002 and required to
avoid declarations of default on "many of the mortgage loans for
the properties."

Palm Garden then requested that the Court enter an order
requiring the parties to fully litigate the issue of the
enforceability of the cross-default clauses before issuing a
ruling on the Debtors' First Rejection Motion.

Before the Court was afforded an opportunity to rule on the
Debtors' First Rejection Motion and Palm Garden's First
Objection and Cross-Motion, the Debtors moved the Court for an
omnibus order pursuant to section 365(d)(4) of the Bankruptcy
Code further extending the time within which the Debtors must
assume or reject unexpired leases of non-residential real
property under which the Debtors are lessees or sub-lessees
(which included therein the Palm Garden Leases), to and
including April 1,2002.

In response to the Debtors' 365(d) Motion, Palm Garden filed an
Objection (the "Second Objection"), which incorporated Palm
Garden's First Objection and Cross-Motion. Palm Garden renewed
its request for relief again under section 365(d)(2) that in the
event that the Debtors were granted an extension of time within
which to assume or reject unexpired leases of non-residential
real property pursuant to section 365(d)(4), that such extension
expire on November 30, 2001 with respect to the Leases.

Since the Debtors' First Rejection Motion was still pending and
the parties expected a speedy resolution to that motion, the
Debtors consented to the relief requested by Palm Garden and a
provision was added to the Court's order granting the Debtors'
motion under section 365(d)(4), which provides in relevant part
as follows:

     "ORDERED, that notwithstanding the foregoing, and absent any
      further orders of this Court, the Debtors shall assume or
      reject the Unexpired Leases which are the subject of the
      objection to the Motion filed by Palm Garden Healthcare,
      Inc. ["PGHI"] on or before November 30, 2001;" (First
      Quoted Decretal Paragraph)

However, Palm Garden was concerned that by fixing such a
deadline, Palm Garden was impliedly consenting to any relief
which the Debtors requested in their assumption or rejection
motion. Since a ruling by the Court on the cross-default issue
would be a prerequisite to this Court's consideration of a
motion to assume or reject any of the Leases, the following
provision was added to the Order:

     "ORDERED, that nothing in this Order shall be construed as a
      waiver of any arguments of the Debtors or PGHI with respect
      to any issues raised in connection with the Debtors' Motion
      for an Order Authorizing Rejection of Five Leases and
      Preservation of Nine Other Leases Each Related to Certain
      Non-Residential Real Property in the State of Florida
      [Docket No. 5070] and/or PGHI's objection thereto [Docket
      No. 5181];" (Second Quoted Decretal Paragraph)

The Debtors point out that the second quoted decretal paragraph
is temporally at war with the first one requiring an assumption
or rejection motion by November 30, 2001 because absent the
determination of the enforceability of the cross-default
provisions prior to November 30, the November 30 deadline became
an impossibility.

Nevertheless, the parties adjourned the Debtors' First Rejection
Motion on mutual consent to allow the parties an opportunity to
explore a consensual resolution of the issue of which Facilities
the Debtors would retain, if any. As those discussions and
negotiations wore on, the Debtors decided to reject an
additional four of the Unprofitable Leases based upon their
analysis of financial projections for 2002. Since the First
Rejection Motion expressly requested that the Court enter an
order preserving the Debtors' rights with respect to nine
Leases, and further since the Court's order of September 28,
2001 accomplished that, the Debtors withdrew their First
Rejection Motion with Palm Garden's consent.

On or about November 16, 2001, the Debtors filed their Second
Rejection Motion seeking to reject nine of the Leases. The
Debtors did not include the remaining five Profitable Leases in
its Second Rejection Motion in anticipation of amending that
motion to include those Leases depending upon the outcome of (i)
the ongoing negotiations between the parties over the future of
the nine Unprofitable Facilities, and/or (ii) a ruling by the
Court on the cross-default issue raised by Palm Garden.

The parties continued to negotiate and commenced face-to-face
meetings at which the parties engaged in an extensive review of
the performance of each of the Facilities, and discussed a
variety of scenarios including the possibility that the Debtors
would retain the unprofitable Facilities. They also exchanged
detailed term sheets which they agreed to maintain in

The nine leases which the Debtors sought to reject in its Second
Rejection Motion included the five Leases which the Debtors
sought to reject in their First Rejection Motion, and the four
Leases for their Jacksonville, North Miami Beach, Pinellas and
Sun City Center Facilities referred to in the preceding

On or about November 30, 2001, the date by which the Debtors
purportedly were to move to assume or reject, Palm Garden filed
its objection (the "Second Objection") to the Second Rejection
Motion, and once again requested, among other things, that the

(1) postpone its decision on the Debtors' Second Rejection
     Motion until such time as the parties could fully litigate
     whether the Debtors are authorized to "cherry pick" among
     the Leases;

(2) deny the Debtors' motion and require that the Debtors move
     to assume or reject all fourteen Leases at the same time;

(3) postpone a decision on the Debtors' motion until such time
     as historical financial data and 2002 projections with
     respect to the nine Unprofitable Leases had been provided to
     Palm Garden; and

(4) postpone a decision on the Debtors' motion until such time
     as the Debtors can propose an adequate procedure for

Palm Garden urged the Court in its opposition papers not to rule
on the Debtors' motion until after (i) discovery is taken by
both parties, (ii) a hearing is held. (iii) additional briefs
are submitted, and (iv) an order is entered by this Court
determining whether the Debtors could assume fewer than all
fourteen (14) of the Leases.

The following Monday (December 3, 2001), when IHS resumed its
negotiations with Palm Garden, Palm Garden took the position
during a meeting between Todd M. Lord, Palm Garden's Chief
Operating Officer, and Matthew Box, IHS' Senior Vice President,
that IHS had not complied with this Court's Order to file a
motion to assume by November 30, 2001.

The Debtors tell Judge Walrath they are surprised at the
position that Palm Garden took at this junction regarding the
November 30, 2001. The Debtors disagree with the position taken
by Palm Garden.

                     The Relief Requested

To eliminate any uncertainty concerning the effect of the
Court's Order, the Debtors request that the Court modify and
amend its terms to extend the time for the Debtors to assume the
five Profitable Leases which were not included in the Debtors'
motion seeking to reject the nine Unprofitable Leases. The
Debtors submit that under the circumstances, the interests of
justice warrants extension of the November 30, 2001 deadline for
the Debtors to move to assume the remaining five Profitable
Leases until ten days after the Court rules on the issue of the
enforceability of the cross-default provisions contained in the

The Debtors remind the Court that they timely moved to reject
the nine Unprofitable Leases in the Palm Garden portfolio, that
Palm Garden took the position in its papers that the cross-
default provisions required the Debtors to assume or reject the
Leases only in toto, that the unforceability of the cross-
default provisions is threshold, and that the parties have
engaged in extensive negotiations concerning the future of the
Facilities which are the subject of the Second Rejection Motion.
All of these, the Debtors submit, would have a major impact on
the Debtors' ultimate decision concerning the disposition of the
five Profitable Leases

           IHS/Palm Garden Lease Portfolio Financ1al Data

Debtor          Facility         EBITDAR   Rent          EBITDA
-------------   -----------     --------  ----------  ----------
IHS No.l, Inc.  Palm Garden     $383,883  $1,033,672  ($649,789)
                  of Clearwater

IHS No.3. Inc.  Palm Garden of   541,802     889,364   (347,562)

IHS No.4, Inc.  Palm Garden of   882,406   1,292,357   (409,951)

IHS No.5, Inc.  Palm Garden of   876,411     931,053    (54,641)
                  North Miami Beach

IHS No.7, Inc.  Palm Garden      612,300   1,146,980   (534,680)
                  of Orlando

IHS No.8, Inc.  Palm Garden      839,395   1,139,497   (300,102)
                  of Pinellas

IHS No.9, Inc.  Palm Garden of   305,803     676,643   (370,840)
                  Port St. Lucie

IHS No.10, Inc. Palm Garden of   611,630   1,009,086   (397,456)
                  Sun City Center

IHS No.11, Inc. Palm Garden     (88,484)     858,364   (946,848)
                  of Tampa

IHS No.2, Inc.  Palm Garden of  1,511,182     866,916    644,266

IHS No.6, Inc.  Palm Garden     2,544,049   1,577,766    966,283
                  of Ocala

IHS No.12, Inc. Palm Garden of  1,997,606   1,292,357    705,249
                  Vero Beach

IHS No.13, Inc. Palm Garden of  1,811,112  1,564,938     246,174
                  West Palm Beach

IHS No.l4, Inc. Palm Garden of    939,835  1,006,948    (67,112)
                               ---------- ----------  -----------
                  Total:       13,768,930 15,285,940  (1,517,010)

EDITDAR: earnings before interest, taxes, depreciation,
           amortization and rent.

EDITDA:  earnings before interest, taxes, depreciation and

                    IHS/Palm Garden Leases
            Which The Debtors Have Moved To Reject

Debtor          Facility         EBITDAR   Rent          EBITDA
-------------   -----------     --------  ----------  ----------
IHS No.1, Inc.  Palm Garden    $383,883  $1,033,672   ($649,789)
                  of Clearwater

IHS No.3, Inc.  Palm Garden of  541,802     889,364    (347,562)

IHS No.4, Inc.  Palm Garden     882,406   1,292,357    (409,951)
                  of Largo

IHS No.5, Inc.  Palm Garden of  876,411     931,053     (54,641)
                  North Miami Beach

IHS No.7, Inc.  Palm Garden     612,300   1,146,980    (534,680)
                  of Orlando

IHS No.8, Inc.  Palm Garden     839,395   1,139,497    (300,102)
                  of Pinellas

IHS No.9, Inc.  Palm Garden of  305,803     676,643    (370,840)
                  Port St. Lucie

IHS No.10, Inc. Palm Garden of  611,630   1,009,086    (397,456)
                  Sun City Center

IHS No.11, Inc. Palm Garden    (88,414)     858,364    (946,848)
                  of Tampa
                              ----------  ----------  -----------
                  Total:      4,965,146    8,977,016  (4,011,870)

                       IHS/Palm Garden Leases
            Which The Debtors Have Not Moved To Reject

Debtor          Facility         EBITDAR   Rent          EBITDA
-------------   -----------      --------  ----------  ---------
IHS No.2, Inc.  Palm Garden of $1,511,182   $866,916    $644,266

IHS No.6, Inc.  Palm Garden     2,544,049  1,577,766     966,283
                  of Ocala

IHS No.12, Inc. Palm Garden     1,997,606  1,292,357     705,249
                  of Vero Beach

IHS No.13, Inc. Palm Garden of  1,811,112  1,564,938     246,174
                  West Palm Beach

IHS No.14, Inc. Palm Garden of    939,835  1,006,948    (67,113)
                  Winter Haven
                                 ---------  ---------  ----------
                  Total:          8,803,784  6,308,925  2,494,859
(Integrated Health Bankruptcy News, Issue No. 26; Bankruptcy
Creditors' Service, Inc., 609/392-0900)

LODGIAN: Court Sets Final Hearing on DIP Financing for Jan. 23
Finding good cause for the entry of an interim order, Judge
Lifland authorizes Lodgian, Inc., and its debtor-affiliates to
borrow or obtain letters of credit pursuant to the DIP Credit
Agreement, and the Guarantors are hereby authorized to guaranty
such borrowings, up to a maximum aggregate principal amount of
$10,000,000, in accordance with the terms of the DIP Credit
Agreement which shall be used, for the purpose of providing
working capital for the Borrower and certain of the Guarantors.
A final hearing on the motion is scheduled on January 23, 2002
and objections are due on or before January 17, 2002. (Lodgian
Bankruptcy News, Issue No. 2; Bankruptcy Creditors' Service,
Inc., 609/392-0900)

LOEWEN GROUP: Alderwoods Group Rises from Loewen's Ashes
The beginning of January has brought more than the start of a
new year. It  has brought a new beginning for North America's
second largest funeral  services company.

Alderwoods Group, Inc. has been launched with approximately 920
funeral homes and 275 cemeteries in the United States, Canada
and the United Kingdom. The company employs approximately 10,000
dedicated professionals all committed to providing outstanding
service to customers, service that delivers an experience of
total care and convenience at a difficult time in their lives.

Paul Houston, President and Chief Executive Officer of
Alderwoods Group, said: "We're off to a great new beginning and
are very well positioned to compete going forward. Our objective
is to break the traditional industry barriers between funeral
and cemetery services, so that each of our professionals can
meet a full range of our customers' needs on a seamless basis.
After all, the people who come to us are either dealing with, or
planning for, a time of significant grief. We aim to make it as
easy as possible for them to make all of the necessary

Alderwoods Group is a U.S. company, incorporated in the State of
Delaware, with corporate offices in Cincinnati, Toronto and
Vancouver. The company has been created pursuant to the Plan of
Reorganization of The Loewen Group, which became effective
yesterday, January 2nd. Alderwoods Group has been launched with
a significantly stronger balance sheet, including liquidity of
approximately $100 million, comprised of cash and a revolving
credit facility, shareholders' equity of close to $700 million,
and total debt of approximately $835 million. The company has 40
million common shares outstanding, which will trade under the
symbol "AWGI" on the NASDAQ, with trading expected to begin

John Lacey, Chairman of Alderwoods Group, said: "Many pieces
have come together for us to reach this point. We're now looking
to the future as a company with committed employees, an
experienced management team and a talented Board of Directors,
all determined to generate value for our stakeholders. We have
everything we need to succeed, now it is time to execute."

For more information about Alderwoods Group, including a service
to find the location nearest you, please see the company's
website at

MARINER POST-ACUTE: Gets Okay to Hire Ashby as Conflicts Counsel
Mariner Post-Acute Network, Inc. Debtors' and Mariner Heath
Group Debtors' retention of Ashby & Geddes (A&G) as Delaware
counsel to the Mariner Group in matters in which Richards,
Layton & Finger (RLF), Delaware reorganization counsel
to the Debtors, has a conflict of interest, nunc pro tunc to
September 19, 2001, has been authorized by the Court. The
Debtors have retained A&G in connection with the Debtors' sale
of the Pharmaceutical Business in particular, and in other
matters in the event RLF is conflicted from representing the
Mariner Group.

The Mariner Group has retained the law firms of Stutman,
Treister & Glatt Professional Corporation (STG) and RLF as
reorganization counsel. While RLF represents Genesis Health
Ventures and its affiliates (the initial bidder for the Debtors'
Pharmaceutical Business) in their Chapter 11 bankruptcy
proceedings, STG has been responsible for issues involving
Omnicare Inc. which, together with APS Acquisition LLC,
submitted a competing bid for the Pharmaceutical Business.

Ashby & Geddes represents Omnicare or affiliates of Omnicare:

      (i) as Delaware counsel in defense of an action to recover
an allegedly preferential transfer in the bankruptcy proceedings
of Foxmeyer Corporation, Case No. 96-1329 (MBM) pending before
the same Court as the Mariner cases;

     (ii) as Delaware counsel in connection with an omnibus
claims objection in the bankruptcy proceedings of Vencor. Inc.,
Case No. 99-3199 (MFW) pending before this Court;

    (iii) as Delaware counsel in connection with a motion to
enlarge in the bankruptcy proceedings of Integrated Health
Services. Inc., Case No. 00-389 (MFW), pending before this
Court, and

     (iv) as counsel in the bankruptcy proceedings Carematrix mc,
Case No. 00-4159 (PJW) pending before this Court. Mr. William P.
Bowden of A&G declares that none of these matters is related in
anyway to the Debtors' bankruptcy proceedings.

Additionally, Omnicare has agreed to waive any potential
conflict of interest Ashby & Geddes may have in representing the
Debtors so long as Ashby & Geddes does not disclose any
confidential information, knowledge of business practices, or
negotiating strategies which Ashby & Geddes may have obtained in
its representation of Omnicare and its affiliates, and that
Ashby & Geddes not argue any motion or directly and actively
participate in Court proceedings in the Debtors' cases in a
manner adverse to Omnicare and its affiliates.

As previously reported, upon the PHCMI's Retention Application,
the Court has authorized the PHCMI Debtors' retention of Ashby &
Geddes as special counsel under section 327(a) of the Bankruptcy
Code in connection with matters in which the interests of the
PHCMI Debtors may diverge from those of the MPAN Debtors. The
Mariner Group and A&G do not believe that A&G's representation
of the Mariner Group in matters in which RLF has a conflict of
interest will conflict with A&G's representation of the PHCMI
Debtors as special counsel, given that the MPAN Debtors have
negotiated and obtained Court approval of a comprehensive
settlement agreement with Omega Healthcare Investors, Inc.
providing for a restructuring of Omega's Mortgages on the 16
skilled nursing facilities in which the PHCMI Debtors have an

The Court is satisfied that A&G represents no interest adverse
to the Mariner Group on the matters with respect to which it is
to be employed.

A&G will be compensated on an hourly basis and be reimbursed for
the actual, necessary expenses it incurs. The hourly attorneys
and paralegals proposed to represent the Mariner Group are:

      Attorney                        Position    Rate
      --------                        --------    ----
      William P. Bowden               Partner     $325 per hour
      Christopher S. Sontchi          Partner     $285 per hour
      Rafael X. Zahralddin-Aravena    Associate   $225 per hour
      Tammie J. Bello                 Paralegal   $100 per hour

In connection with the Debtors' sale of the Pharmaceutical
Business, A & G's fees and expenses will be allocated 82% to the
MPAN Debtors and 18% to the MHG Debtors, which is generally
consistent with the views of the Mariner Group's principal
secured creditors as to the relative allocation of the value of
the Pharmaceutical Business assets. (Mariner Bankruptcy News,
Issue No. 22; Bankruptcy Creditors' Service, Inc., 609/392-0900)

MCLEODUSA INC: Will Not Make Jan. Interest Payments on Sr. Notes
McLeodUSA Incorporated (Nasdaq:MCLD), one of the nation's
largest independent competitive local exchange carriers,
announced that consistent with its exchange offer and proposed
recapitalization transaction announced on December 3, 2001, it
has not paid the scheduled January 1, 2002 interest payment on
its $750 million 11-3/8% Senior Notes due 2009, nor will it pay
the scheduled January 15, 2002 interest payments on its $150
million 12% Senior Notes due 2008 and its $225 million 9-1/4%
Senior Notes due 2007. The payment of interest under the terms
of these notes is subject to a 30-day grace period.

The Company said that it is continuing discussions with the
holders of its bonds on the terms of the previously announced
exchange offer and recapitalization transactions.

McLeodUSA provides integrated communications services, including
local services, in 25 Midwest, Southwest, Northwest and Rocky
Mountain states. The Company is a facilities-based
telecommunications provider with, as of September 30, 2001, 393
ATM switches, 58 voice switches, 437 collocations, 520 DSLAMs,
over 31,000 route miles of fiber optic network and 10,700
employees. In the next 12 months, McLeodUSA plans to distribute
34 million telephone directories in 26 states, serving a
population of 58 million. McLeodUSA is traded on The Nasdaq
Stock Market(R) under the symbol MCLD. Visit the Company's web
site at

DebtTraders reports that McLeodUSA Inc.'s 8.125% bonds due in
2009 (MCLD1) are trading in the low 20s.  Go to
real-time bond pricing.

METALS USA: Court Approves Proposed Reclamation Claim Procedures
Metals USA, Inc., and its debtor-affiliates sought and obtained
an order from the Court:

A. providing that Reclamation Claimants must file with the Court
    and serve on counsel for Debtors a Motion to Approve
    Reclamation Claim, together with all evidence regarding the
    amount and validity of the claim, including whether the
    goods can be identified;

B. providing that Debtors shall use their best efforts to
    determine whether any goods subject to a valid reclamation
    claim were in Debtors' possession and were "identifiable"
    at the time any written, valid reclamation demand was

C. providing that after a determination made by Debtors that
    Reclamation Claimants have a valid reclamation claim,
    Debtors may, in their sole discretion, give these
    reclamation claimants an administrative expense priority
    claim in these cases or return such goods to Reclamation
    Claimants, if the goods are not necessary to

Zack A. Clement, Esq., at Fulbright & Jaworski LLP in Houston,
Texas, tells the Court that in the ordinary operation of the
Debtors' businesses, numerous vendors provide the Debtors with
millions of dollars of goods on a monthly basis. On a daily
basis, large quantities of goods are in transit to or from
Debtors' facilities, including goods needed to sustain the
Debtors' ongoing operations. These goods are often unique and
would be difficult, if not impossible to obtain from alternative
sources and therefore, the Debtors may need to keep some of the
goods subject to valid reclamation claims.

The Debtors have already received many reclamation demand
letters and believe that many additional vendors will attempt to
assert their right to reclaim goods delivered to the Debtors
shortly before the petition date.

The Court authorizes the Debtors to grant administrative
priority treatment to the claim of any reclamation claimant:

A.  who timely demands the reclamation of goods, whose goods the
     Debtors have accepted for delivery,

B. who properly identifies the goods to be reclaimed, whose
    goods the Debtors have accepted for delivery,

C. who properly identifies the goods to be reclaimed,

D. whose goods the Debtors do not agree to make available for
    pick-up by the reclamation claimant after:

      a. Reclamation Claimant files with the Court and serves on
         Counsel for the Debtors a motion to Approve
         Reclamation Claim, together with evidence concerning
         whether the goods can be identified and the amount and
         validity of the claim;

      b. Debtors determine that any goods subject to a valid
         reclamation claim were in Debtors' possession and were
         identifiable at the time reclamation demand was given;

      c. Debtors determine that vendors have a valid reclamation

The Debtors believe that the relief requested will ensure the
continuous supply of goods which are vital to the Debtors'
continuous operations and integral to Debtors' continued going
concern value.

The Debtors believe that an order approving the return of goods
to reclamation claimants for credit against their pre-petition
claims is in the best interest of the Debtors estates because it
will enable the Debtors to:

A. obtain trade credit to allow Debtors to obtain proper credit
    for otherwise unusable goods cost-effectively and without
    undue financial risk, and

B. affectively manage inventory, enhancing Debtors' financial
    performance, value of the assets of the estates and the
    prospects of a successful reorganization.

The Court also order that reclamation claimants are prohibited
from seeking to reclaim goods that have already been delivered
to Debtors' customers, contacting Debtors' customers to reclaim
goods that have already been delivered to Debtors' customers, or
interfering with the delivery of goods presently in transit to
the Debtors. (Metals USA Bankruptcy News, Issue No. 5;
Bankruptcy Creditors' Service, Inc., 609/392-0900)

NATIONSRENT: Gets Interim Okay of Investment Deposit Guidelines
The Court entered an order approving, on an interim basis,
NationsRent Inc.'s investment guidelines and, after notice and
an opportunity for hearing, approve the Investment Guidelines on
a final and permanent basis.

Daniel J. DeFranceschi, Esq., at Richards Layton & Finger, P.A.
in Wilmington, Delaware, submits that the Debtors are large,
sophisticated companies with a complex cash management system
that provides the Debtors with the ability to transfer funds
rapidly to ensure their safety. In light of these factors and
the safety of the investment vehicles that the Debtors propose
to utilize to invest excess funds and funds deposited into the
Investment Accounts, the Debtors believe that sufficient cause
exists under section 345(b) to allow the Debtors to deviate from
the investment guidelines established by the Bankruptcy Code.

The Debtors propose to make investments only in accordance with
the Investment Guidelines, pursuant to which the Debtors will
only invest in:

A. Marketable direct or guaranteed obligations of the United
    States of America that mature within 1 year from date of

B. demand deposits, certificates of deposit and time deposits of
    commercial bank in the U.S. or of foreign banks having
    unimpaired capital and surplus in excess of $250,000,000;

C. securities commonly known as commercial paper issued by a
    corporation organized and existing under the laws of the
    U.S. or any state thereof that at the time of purchase have
    been rated and the ratings for which are not les the "P1"
    if rated by Moody's and not less than "A1" if rated by
    Standard & Poor's;

D. Money market mutual funds which invest primarily in assets
    described above;

E. Extensions of credit in the nature of accounts receivable or
    notes receivable arising from the sale of lease of goods or
    services in the ordinary course of business;

F. Investments in RDO Equipment, Toromont Industries, United
    Rentals Inc., Western Power & Equipment Corp., National
    Equipment Services Inc., Neff Corp., Lowes, Home Depot,
    Mobile Mini, and Ashtead;

G. Loans investments with respect to swap, hedge, cap floor,
    swap options or other similar investments;

H. contributions to and payments of benefits under any employee
    benefit plan of the Debtors in accordance with the terms of
    such employee benefit plan; and

I. advances or loans made in the ordinary course of business not
    to exceed $5,000,000 in the aggregate outstanding at any

Under the Cash Management System, Mr. DeFranceschi explains that
funds generated by the business operations of each participating
Debtor ultimately flow into the Concentration Account, subject
to any applicable disbursements. As individual Debtors
participating in the Cash Management System require funds to
meet current obligations, cash is automatically transferred from
the Concentration Account into the appropriate disbursement
accounts to fund necessary disbursements. Accordingly, at any
given time, there may be balances due and owing from one Debtor
to another Debtor, which represent extensions of intercompany
credit.   Mr. DeFranceschi assures the Court that the Debtors
maintain strict records of all transfers of cash and can readily
ascertain, trace and account for all Intercompany Transactions.
The Debtors, moreover, will continue to maintain such records,
including records of all current intercompany accounts
receivable and payable.

To ensure that each individual Debtor will not, at the expense
of its creditors, fund the operations of another entity, the
Court orders that all intercompany claims against a Debtor by
another Debtor arising after the Petition Date as a result of
Intercompany Transactions through the Cash Management System be
accorded administrative expense status. If Intercompany Claims
are accorded administrative expense status, Mr. DeFranceschi
submits that each entity utilizing funds flowing through the
Cash Management System should continue to bear ultimate
repayment responsibility for such borrowings. (NationsRent
Bankruptcy News, Issue No. 2; Bankruptcy Creditors' Service,
Inc., 609/392-0900)

NETWORK PLUS: Taps UBS Warburg to Explore Restructuring Options
Network Plus Corp., (NASDAQ: NPLS), announced that it has
entered into a limited waiver of certain terms of its senior
credit facility. This waiver will expire on January 31, 2002.
Network Plus may borrow an additional $3 million under the
senior credit facility during the waiver period, subject to the
conditions in the senior credit facility.

Network Plus is continuing discussions with its lenders about
restructuring its senior credit facility. Under discussion with
its lenders are the amount of additional loans, the maturity
date of the senior credit facility, and other terms and
covenants associated with the senior credit facility.

Network Plus also announced that it has engaged UBS Warburg LLC
to examine financial and restructuring alternatives for Network

The amount of funding provided by the limited waiver under the
senior credit facility is approximately $50 million less than
the amount of borrowings required under Network Plus' current
business plan. There can be no assurance Network Plus will be
successful in extending this limited waiver, restructuring its
senior credit facility on either a short-term or long-term
basis, obtaining a replacement of its existing senior credit
facility to fund its additional business plan needs, or
otherwise obtaining necessary debt or equity financing. If it is
not successful, Network Plus may default under its senior credit
facility or may be required to substantially modify its current
business plan, including reducing or terminating all or
significant portions of its operations and any planned

Network Plus is a network-based integrated communications
provider headquartered in Randolph, Massachusetts. Network Plus
offers broadband data and telecommunications services, primarily
to small and medium-sized business customers located in major
markets in the Northeastern and Southeastern regions of the
United States. The Company's bundled product offerings include
local and long distance service as well as enhanced, high-speed
data and Internet services. For more information on Network Plus
Corp., please visit the Company's website at

NEXTEL INTERNATIONAL: Changes Name to NII Holdings, Inc.
On December 21, 2001, Nextel International, Inc. filed an
amendment to its certificate of incorporation with the Delaware
Secretary of State, changing its name from Nextel International,
Inc. to NII Holdings, Inc.

Nextel International primarily provides wireless services in
Argentina, Brazil, Chile, Mexico, and Peru. Because it employs
the same iDEN technology as Nextel Communications in the U.S.,
Nextel International is able to offer the Direct Connect
service. As at June 30, 2001, the company's balance sheet is
upside-down, with total stockholders' equity deficit of about
$170 million.

NOVO NETWORKS: Units File Amended Plan & Disclosure Statement
Novo Networks, Inc. (OTCBB: NVNWQ.OB) announced that certain of
its operating subsidiaries - including Novo Networks Operating
Corp., AxisTel Communications, Inc. and e.Volve Technology
Group, Inc. - filed an amended plan and disclosure statement
with the U.S. Bankruptcy Court for the District of Delaware on
December 31, 2001.

The filings contemplate a liquidation of the subsidiaries'
assets under Chapter 11 of the U.S. Bankruptcy Code, instead of
a reorganization as was previously planned.

The Company further announced that effective Wednesday, its
shares began trading on the OTC Bulletin Board under the symbol
"NVNWQ.OB." The Company's common stock had been quoted on The
Nasdaq National Market System under the symbol "NVNW"
(Nasdaq:NVNW), but its shares were delisted by The Nasdaq Stock
Market on December 31, 2001.

PACIFIC GAS: Seeks Preliminary Injunction vs. ORA Director
Pacific Gas and Electric Company has asked the U.S. Bankruptcy
Court for a preliminary injunction against the director of the
California Public Utilities Commission Office of Ratepayers
Advocates (ORA), noting the ORA "seeks to circumvent the
Bankruptcy Court's jurisdiction over administration of the
estate and the plan of reorganization (POR) confirmation

The ORA requested the utility produce the documents in a
proceeding opened by the CPUC to review the relationship between
the utility and its parent, PG&E Corporation.  The data request
covers documents related to the proposed POR, including
information relating to settlement offers with generators,
copies of Board of Directors meeting minutes relating to
bankruptcy discussions and financial work papers relating to the

In its filing, Pacific Gas and Electric Company noted "such
documents would typically be produced, if at all, only in
response to a discovery request related to plan confirmation
objections.  This is information that, if discoverable at all,
is properly requested only through discovery in this bankruptcy
case and supervised by this Court."

While some of these requests might be allowed, at least in
modified form, in discovery supervised by the Bankruptcy Court
and subject to timing, rules, relevance and privileges
determined by bankruptcy rules, they are inappropriate in a
collateral proceeding outside the Court's jurisdiction where
entirely different and conflicting interests may be served.

In a letter to the utility, ORA said they "would use the
requested information . . . in both the OII and the bankruptcy
proceeding."  The preliminary injunction seeks to prevent the
director of ORA from requesting and obtaining the documents
because the data request is an attempt to circumvent the
Bankruptcy Court's exclusive jurisdiction to administer the case
and control the plan confirmation process.

A hearing on the preliminary injunction request is scheduled for
February 4, 2002.

PACIFICARE HEALTH: Expects $90M in Savings from Improvement Plan
PacifiCare Health Systems Inc., (Nasdaq:PHSY) announced a profit
improvement program that is expected to produce annualized cost
savings of approximately $80 million to $90 million, increase
revenues and redirect the company's position in the evolving
health-care marketplace.

The program, to be implemented during the next three quarters,
will include:

      -- Consolidation of company operations;

      -- A 15% total reduction in staff;

      -- Outsourcing of PacifiCare's information technology
         production and software maintenance services;

      -- Increased and intensified marketing efforts to enhance
         awareness of the company's distinct brands and new
         consumer product offerings.

The company said the goal of the actions is to improve
profitability, reposition the company's brands and to generate
new membership through a major marketing effort in 2002, further
demonstrating PacifiCare's transition from a health maintenance
organization to a full-range consumer health company.

The company said that its profit improvement program will result
in a fourth quarter pre-tax charge of approximately $60 million,
or approximately $1.14 per share on a full-year basis, for
severance and associated facilities and fixed asset impairment
costs. PacifiCare said it remains and expects to remain in
compliance with the terms of its senior credit facility.

However, inasmuch as the charge creates a quarterly loss, the
company said it is desirable though not necessary to obtain
approval from a majority of the company's bank syndicate to
waive a requirement that PacifiCare retain a financial
consultant. PacifiCare said that it is working collaboratively
with its lead bank, Bank of America, to obtain this amendment.

       Company Sets 2002 EPS Guidance of $3.55 to $3.65

Gregory W. Scott, PacifiCare's chief financial officer, said
that 2002 earnings per share is expected to be in the range of
$3.55 to $3.65, including the positive impact of the elimination
of goodwill amortization under SFAS No. 142, which amounts to
approximately $1.60 per share. The guidance does not include
non-cash charges related to changes in accounting for the
balance sheet carrying value of goodwill that may be taken in

Howard G. Phanstiel, PacifiCare's president and chief executive
officer, added, "We expect profit margins to improve in 2002 as
new, profitable membership gains offset exits from unprofitable
markets. Earnings are expected to increase at least 15% in 2002,
excluding the effect of goodwill accounting changes."

In addition, PacifiCare disclosed that it expects to invest more
than $80 million in incremental selling, general and
administrative expenses to expand its core business and to
support new strategic initiatives in 2002.

     2002 Marketing Effort To Emphasize Company Track Record

PacifiCare said that as part of this effort, its 2002 marketing
campaign would feature print, TV, radio and billboard
advertising and would emphasize the company's track record of
achieving high levels of customer satisfaction and quality of

"In this campaign, we'll be telling consumers about the quality
of the doctors who participate in PacifiCare and Secure Horizons
health plans, and how we're building on our proven track record
of customer satisfaction to meet the consumer's changing and
expanding health-care needs," said Phanstiel.

PacifiCare said that it selected Doner, Detroit and Newport
Beach -- the largest independently owned advertising agency in
the United States -- to launch its 2002 marketing campaign after
an extensive competitive review process.

           PacifiCare's Commitment to Quality of Care
                 and Service Further Validated

The company said it was pleased that, in yet another validation
of PacifiCare's commitment to quality of care and service, the
national health plan accrediting association, NCQA, this month
ranked PacifiCare of Arizona its highest rating category of

According to Sam Ho, MD, corporate medical director, "Our
Arizona health plan joins our health plans in Washington, Oregon
and Oklahoma with Excellent designations, representing the top
10% of health plans reviewed by NCQA. We fully expect our
California health plan, PacifiCare's largest subsidiary, to
achieve Excellent accreditation status in the near future.
PacifiCare of California also received favorable ratings from a
leading consumer reporting publication."

          Corporate Restructuring and Workforce Reductions
         Enhance Efficiencies and Support Growth Objectives

The company further announced a reorganization designed to
enhance focus on its commercial business growth and to improve
its operational efficiency. Phanstiel stated that a key part of
the reorganization will be a structural change to create a new
division responsible for developing and distributing all of the
company's senior products and services.

Brad Bowlus, president and CEO of the company's Health Plans
Division, will continue to oversee all of the company's health
maintenance organizations, preferred provider organization
operations, and ancillary insurance product lines, PacifiCare
Behavioral Health and PacifiCare Dental and Vision.

Kathy Feeny, head of the Secure Horizons Medicare Supplement
insurance product, has been named to the new position of senior
vice president, Secure Horizons Senior Solutions. She will
report directly to Phanstiel and will be responsible for the
sales and marketing of all of the company's senior businesses,
including Medicare + Choice plans, Medicare Supplement and other
products and services designed especially for seniors.

Prescription Solutions, the company's pharmacy benefit
management subsidiary, will continue to report to Executive Vice
President Bary Bailey, who also has responsibility for the
company's information technology.

The company announced that it has signed a 10-year agreement
with IBM and reached an agreement in principle with Keane Inc.,
under which PacifiCare will outsource its information technology
operating and software maintenance functions to those companies.

"The $1.2 billion outsourcing agreements are expected to result
in savings of $380 million to $400 million over the term of the
contract, as well as provide access to state-of-the-art
solutions and best practices in information technology," said

"This corporate reorganization, together with the outsourcing of
information technology, furthers our efforts to operate as a
single company under a uniform business model and technology
platform and reduces our cost of doing business," said

Commenting further on the workforce reduction, Phanstiel said
that the 15% reduction, or approximately 1,300 positions, would
come from three primary sources:

      -- Job eliminations already implemented or announced in
         most states (which began in October 2001), as well as
         additional position eliminations over the remainder of

      -- Normal and customary attrition; and,

      -- Elimination of open positions.

These reductions are being achieved through consolidation and
standardization of company operations as well as from
significant investments recently made in technology and process

Phanstiel concluded: "In 2001 our focus was to keep pace with
medical cost inflation by implementing appropriate pricing
strategies, a stronger underwriting discipline and medical
management programs, by exiting unprofitable markets and
products and streamlining overhead. Now we enter 2002 with a
resolve to sharpen our focus on building membership in
profitable product lines and to continue our efforts to
diversify our business."

PacifiCare Health Systems is one of the nation's largest health-
care services companies. Primary operations include managed care
products for employer groups and Medicare beneficiaries in eight
Western states and Guam serving approximately 3.6 million
members. Other specialty products and operations include
pharmacy benefit management, behavioral health services, life
and health insurance, and dental and vision services.

In September of last year, Fitch affirmed PacifiCare Health
Systems, Inc.'s 'BB+' senior debt rating, while keeping negative
outlook on the rating. According to the international rating
agency, the rating considered the deterioration in PacifiCare's
operating performance, modest levels of capitalization at the
operating level, and high levels of debt refinance risk. The
Company's profitability challenges can be attributed to a
provider-driven movement away from capitated contracting and
towards shared risk contracting, as well as to a continued
poor operating environment in the Medicare + Choice marketplace.
At the end of June 2001, the company reported a strained
liquidity, with total current liabilities exceeding total
current assets by over $300 million.

More information on PacifiCare can be obtained at
http://www.pacificare.comor by calling 877/PHS-STOCK (877/747-

PAXSON COMMS: Launches Senior Sub. Discount Note Offering
Paxson Communications Corporation (AMEX:PAX) announced that it
has commenced an offering of senior subordinated discount notes.
Proceeds of the offering will be used to refinance the company's
12-1/2% exchange debentures due 2006 which will be issued in
exchange for the outstanding shares of the company's 12-1/2%
exchangeable preferred stock on or about the closing date of the
offering.  The senior subordinated discount notes which will be
due in 2009 are expected to generate gross proceeds of $310
million and will be guaranteed by the company's subsidiaries.
The company expects to issue the senior subordinated discount
notes in January, subject to market conditions.

The offering of senior subordinated discount notes will not be
registered under the Securities Act of 1933, as amended, and the
notes will be offered and sold only to "Qualified Institutional
Buyers" (as defined under Rule 144A under the Securities Act)
and outside of the United States in accordance with Regulation S
under the Securities Act. The Notes may not be offered or sold
in the United States absent registration or an applicable
exemption from registration. This news release shall not
constitute an offer to sell or the solicitation of an offer to
buy the Notes.

To facilitate the refinancing and the offering, Paxson also
announced today that they are soliciting consents to amend the
certificate of designation governing the company's 12 1/2%
Cumulative Exchangeable Preferred Stock and the indenture
governing the related 12 1/2% exchange debentures for which the
12-1/2% preferred stock is exchangeable.

The consent solicitation announced Wednesday will expire at
10:00 a.m., New York City time on January 4, 2002, unless
extended. Only holders of record of the 12 1/2% preferred stock
as of the close of business on Friday, December 28th will be
eligible to consent. Salomon Smith Barney is acting as
solicitation agent for the consent.

Paxson Communications Corporation owns and operates the nation's
largest broadcast television station group and PAX TV, the
newest broadcast television network that launched in August of
1998. PAX TV reaches 84% of U.S. television households via
nationwide broadcast television, cable and satellite
distribution systems. Paxson owns and operates 65 stations
(including three stations operated under time brokerage
agreements). PAX airs its own original programming including
"It's A Miracle," "Mysterious Ways," "Encounters with the
Unexplained" and "Doc," starring recording artist Billy Ray
Cyrus. PAX TV's new season lineup includes the original series
"The Ponderosa," "Ed McMahon's Next Big Star" and "Candid
Camera." Additional Paxson properties include the PAX Family
Club, a branded affinity club that provides travel and product
discounts for families, parenting advice and valuable online
information. For more information, visit PAX TV's website at

PILLOWTEX CORP: Wants Approval to Expand Scope of KPMG's Work
Pillowtex Corporation, and its debtor-affiliates seek the
Court's authority to expand the scope of KPMG LLP's retention
and employment as tax advisors in these chapter 11 cases.

Eric D. Schwartz, Esq., at Morris, Nichols, Arsht & Tunnell, in
Wilmington, Delaware, reminds the Court that KPMG is already
authorized to provide a broad spectrum of tax advisory services
to the Debtors.  Nonetheless, Mr. Schwartz says, the Debtors
seek to add more responsibilities to KPMG.  Specifically, Mr.
Schwartz relates, the Debtors want KPMG to implement specific
employment tax planning opportunities for the Debtors for which
KPMG will be paid a flat fee rather than the hourly rate basis
contemplated in the original Engagement Letter.

Pursuant to the Supplemental Engagement Letter, Mr. Schwartz
outlines the advisory tax services that KPMG will provide:

     (a) assisting in the formulation of employment tax planning

     (b) tailoring any employment tax planning opportunities to
         meet the Debtors' post-bankruptcy needs;

     (c) evaluating income, franchise, real estate, personal
         property and sales/use tax issues related to the
         implementation of the Fieldcrest Employee Restructuring;

     (d) evaluating and providing advice on non-tax issues
         related to any employment tax planning opportunities,
         including accounting, operational, technology or
         regulatory issues related to the implementation of the
         Fieldcrest Employee Restructuring;

     (e) preparing an economic cost study regarding sustainable
         intercompany pricing levels in connection with the
         implementation of the Fieldcrest Employee Restructuring;

     (f) performing a post-implementation review of the
         employment tax planning actions taken to evaluate
         whether those actions are achieving the intended
         benefits and to determine additional recommendations to
         strengthen the tax planning strategy;

     (g) communicating with taxing jurisdictions affected by the
         implementation of the employment tax planning strategy;

     (h) assisting in any defense of the employment tax planning
         opportunities in the unlikely event of an audit.

Mr. Schwartz emphasizes that all terms and conditions of the
Original Engagement Letter will remain in full force and effect,
except as expressly amended by the Supplemental Engagement
Letter.  Mr. Schwartz explains that fee arrangement under the
Supplemental Engagement Letter relates only to the development
and implementation of employment tax planning opportunities or
the pursuit of tax refund opportunities.  "Any additional
services related to other potential tax savings would be subject
to amendment of the Supplemental Engagement Letter," Mr.
Schwartz says.

As compensation for KPMG's services in connection with the
development and implementation of the employment tax planning
opportunities, Mr. Schwartz informs Judge Robinson that the
Debtors will pay KPMG a fixed fee of $275,000, which will be
paid in two equal installments.  According to Mr. Schwartz, the
first installment will be due upon Court approval of this
Application and the second installment will be due the later of
February 15, 2002 or the date the Debtors receive the North
Carolina state unemployment rate notices affected by the
implementation of the tax planning opportunities.  Mr. Schwartz
explains that the Fixed Fee is not dependent on the actual
amount of savings achieved by the Debtors.

In addition, Mr. Schwartz continues, KPMG will also be entitled
to reimbursement for all actual and necessary out-of-pocket
expenses, not to exceed 10% of the Fixed Fee.  Mr. Schwartz
tells the Court that these expenses will be billed with the
Fixed Fee installments, except that any Expenses incurred too
late to include with the second Fixed Fee installment will be
billed on April 1, 2002.

During the course of the engagement, Mr. Schwartz advises the
Court that KPMG may identify employment tax refund
opportunities, which will be shared with the Debtors.  "If KPMG
identifies significant tax refunds that the Debtors wish to
pursue, the Debtors will pay to KPMG 35% of any refund amount
realized by the Debtors as compensation for identifying and
assisting the Debtors in securing the refund," Mr. Schwartz

Mr. Schwartz assures the Court that KPMG will maintain records
of the professional services rendered to the Debtors and the
Expenses.  "KPMG will apply to the Court for payment of
compensation and reimbursement of expenses," Mr. Schwartz says.

Because of the need to implement the employment tax planning
opportunities and the Fieldcrest Employee Restructuring prior to
year end, Mr. Schwartz informs Judge Robinson that the Debtors
have requested KPMG to begin performing these supplemental
services since September 17, 2001.  Accordingly, the Debtors
seek the Court's approval of the expansion of KPMG's services
nunc pro tunc as of September 17, 2001.

J. Robert Lawter, Jr., a partner in KPMG LLP, tells the Court
that the firm has updated its prior search to determine, and to
disclose, whether it is providing services, or has provided
services, to the Original Interested Parties or to any
significant parties in interest in these cases that have been
identified since KPMG's original disclosure.

Despite such efforts, Mr. Lawter admits, KPMG is unable to state
with certainty that every client relationship or other
connection has been disclosed, considering the fact that the
Debtors are a large enterprise with thousands of creditors and
other relationships.  In this regard, Mr. Lawter promises the
Court that if KPMG discovers additional information that
requires disclosure, KPMG will file a supplemental disclosure as
promptly as possible.

Mr. Lawter swears that -- "To the best of my knowledge and
belief, insofar as I have been able to ascertain after
reasonable inquiry, neither I, nor KPMG, nor any partner,
principal or professional staff member who will provide services
to the Debtors:

     (a) is related to the Debtors, their creditors, the U.S.
         Trustee, anyone employed in the U.S. Trustee's office or
         any other party in interest in these cases; or

     (b) has any connection with or holds or represents any
         interest adverse to the Debtors, their estates, their
         creditors or any other party in interest or their
         respective attorneys,

in the matters for which KPMG has been, or is proposed to be,

Accordingly, Mr. Lawter assures the Court that KPMG continues to
be a "disinterested person," as defined in section 101(14) of
the Bankruptcy Code. (Pillowtex Bankruptcy News, Issue No. 19;
Bankruptcy Creditors' Service, Inc., 609/392-0900)

SENIOR HOUSING: Revises Lease Terms with HEALTHSOUTH Corporation
Senior Housing Properties Trust (NYSE: SNH) announced that it
has revised lease terms with HEALTHSOUTH Corporation (NYSE:
HRC), as follows:


      HEALTHSOUTH became a tenant of SNH for five nursing homes
when HEALTHSOUTH acquired Horizon/CMS Healthcare Corporation in
1997. Shortly thereafter, HEALTHSOUTH transferred operating
responsibilities for these five properties to Integrated Health
Services. In 2000, Integrated filed for bankruptcy and
HEALTHSOUTH resumed control of these properties. In September
2001, HEALTHSOUTH advised SNH that it would cease operations at
one of these properties. Although HEALTHSOUTH continued to pay
rents due SNH, SNH advised HEALTHSOUTH that its cessation of
operations was a lease default. Since September 2001, SNH and
HEALTHSOUTH have negotiated.

Revised Terms:

The revised lease terms are as follows:

      (i) Ownership of the five nursing homes owned by SNH will
be exchanged for ownership of two rehabilitation hospitals owned
by HEALTHSOUTH. The two hospitals will be leased by HEALTHSOUTH.
The five nursing homes have 762 licensed beds. The two
rehabilitation hospitals have 364 licensed beds and offer
outpatient rehabilitation services. The two rehabilitation
hospitals are Braintree Rehabilitation Hospital and New England
Rehabilitation Hospital; both are located in Massachusetts.

      (ii) The lease for the five nursing homes expired in four
years, on January 1, 2006. That lease included renewal and
tenant purchase options, but, because these nursing home
operations were not profitable, SNH did not expect that
HEALTHSOUTH would exercise these options. The revised lease will
be for 10 years through December 31, 2011, plus renewal and
purchase options thereafter. Based upon the profitable
historical operations of these hospitals, SNH currently expects
that these options may be exercised by HEALTHSOUTH.

      (iii) The rent to SNH for the five nursing homes was $10
million per year. The rent to SNH for the two hospitals will be
$8.7 million per year.

      (iv) The property exchange and revised lease terms were
effective on January 2, 2002; and

      (v) The lease will remain a full recourse obligation of
HEALTHSOUTH and the other lease terms will remain substantially

Commentary by SNH Management:

David J. Hegarty, President of SNH, made the following comments
concerning these revised lease terms:

      "I am pleased that SNH and HEALTHSOUTH were able to resolve
their differences. The two hospitals which SNH is acquiring have
been strong performers for HEALTHSOUTH and their historical
operations more than cover the pro-forma rent. SNH management
believes that the properties exchanged were of equivalent values
and that the extended lease term and the increased rent coverage
from historical operations is fair compensation for the reduced

Senior Housing Properties Trust (SHPT) is a real estate
investment trust (REIT) that deals exclusively in senior living
properties. The REIT has over 80 properties in about 25 states
which offer housing options for the elderly at various levels of
independence. Marriott International's senior living division is
the SHPT's largest tenant, but two others -- Integrated Health
Services and Mariner Post-Acute Network (which together provided
almost half of revenues) -- filed for bankruptcy in 2000; SHPT
established a subsidiary to operate most of their nursing homes
until new third-party tenants can be found. The company was spun
off from HRPT Properties Trust, which still owns about 45% of

TANDYCRAFTS: Asks for Removal Period Extension through April 11
Tandycrafts, Inc., seeks entry of an order further extending the
period within which the Debtors may remove actions and file
notices of removal through April 11, 2002 with respect to civil
actions pending as of the Petition Date.

The Debtors are party to several actions in various state and
federal courts. However, due to the myriad issues facing the
Debtors from the outset of these cases including stabilizing
their day-to-day operations, negotiating the use of cash
collateral and a debtor-in-possession financing facility with
their pre-petition lenders, negotiating proposed asset
dispositions, winding down their Mexican operations and
exploring stand-alone and third-party plan of reorganization
scenarios, the Debtors have not had an opportunity to develop
fully a strategy for handling the Pre-Petition Actions.

Tandycrafts, a leading manufacturer and marketer of picture
frames, mirrors and other wall decor products, filed for chapter
11 protection on May 15, 2001 in the U.S. Bankruptcy Court for
the District of Delaware.  Mark E. Felger, Esq., at Cozen and
O'Connor, represents the company in its restructuring efforts.
When the Company filed for protection from its creditors, it
listed assets of $64,559,000 and debts of $56,370,000.

TELSCAPE: Has Until February 18 to File Schedules & Statements
The U.S. Bankruptcy Court for the District of Delaware grants
Telscape International, Inc. an extension to file its schedules
of assets and liabilities; statements of financial affairs;
lists of equity security holders; and lists of executory
contracts and unexpired leases.  The new deadline is February
18, 2002.

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.

TRANSIT GROUP: Obtains Court Approval of First Day Orders
Transit Group, Inc. (OTC Bulletin Board: TRGP) announced that it
has received approved First Day Orders from the United States
Bankruptcy Court for the Middle District of Florida, supporting
normal business operations during the company's Chapter 11
financial reorganization.

Excluded from the filing is the company's Land Transportation
subsidiary, which governs relationships with trucking agents and

"These First Day Orders are key to ensuring continuity of our
normal business operations," said Philip A. Belyew, President
and CEO.  "They support our commitment to honor our ongoing
obligations to our workforce and our customers throughout our
financial reorganization."

The Court has approved an order granting transit the authority
to continue to manage its affairs on a normal course basis
throughout the restructuring process.  The Court also approved
the granting of a $7 million debtor-in- possession ("DIP")
financing facility from GE Capital Corporation. In addition, the
company has ongoing access to an operating line of credit
supported by its senior working capital lender.

The Court also authorized the company to continue to meet its
ongoing financial obligations to its employees, owner-operators,
agents, brokers and third-party carriers, which make up the
Transit workforce.

Transit Group, Inc., headquartered in Atlanta, Georgia, is one
of the largest truckload companies in the United States, with
operations in 48 states.

U.S. PLASTIC: Inks Agreement to Sell Clean Earth to New CEI Inc.
U.S. Plastic Lumber Corp. (Nasdaq:USPL), announced that its
Board unanimously approved a signed Purchase Agreement to sell
Clean Earth Inc., its environmental services and recycling
division, to New CEI, Inc., a corporation recently formed by
Founders Equity, an investment group headquartered in New York.
The Purchase Price consists of the following: (a) $45 million in
cash; (b) the retention of $5.5 million in debt in CEI; (c) the
issuance of Junior Preferred Stock with a stated value of $5
million and a 5% PIK coupon; and (d) the issuance of warrants to
purchase 4% of the Purchaser.

In addition, USPL will retain certain assets of CEI with a
current book value of approximately $4.5 million. The Purchase
Price is subject to adjustment primarily based upon the amount
of working capital and debt assumed at closing. The closing of
this transaction will be subject to government approval,
approval by the shareholders of USPL, consent from certain
lenders, and other conditions. It is the intent of the parties
to close this transaction by the end of February subject to
meeting all conditions precedent to closing.

Mark S. Alsentzer, USPL's Chief Executive Officer said, "We are
satisfied with the deal terms we received on the sale of CEI and
we will recommend our shareholders approve the transaction. We
will use the proceeds to significantly reduce our debt, and by
doing so, we anticipate the balance sheet and liquidity of USPL
will be much improved. This, coupled with the on-going
reorganization of our plastic operations, should position USPL
to have an improved financial condition, which we believe will
enable USPL to profitably grow its plastic business."

USPL also announced that it has signed a Forbearance Agreement
with its Senior Lenders in connection with USPL's Senior Credit
Facility. The Forbearance Agreement permits USPL to defer the
principal payments on its term loan that were due September 30,
2001 and December 31, 2001, and allows USPL to continue to
borrow and repay loans on its revolving credit facility. Under
the terms of the Agreement, the Senior Lenders have agreed to
take no action against USPL for not making the principal payment
due September 30, 2001 and for violations of financial covenants
as of that date.

               Important Notice To Stockholders

U.S. Plastic Lumber Corp. (USPL) will be filing a preliminary
proxy statement and definitive proxy statement with the
Securities and Exchange Commission in connection with the sale
of its wholly owned subsidiary, Clean Earth, Inc.

Stockholders of USPL are urged to read USPL's proxy statement
when it becomes available because it contains important
information about the sale of Clean Earth, Inc.

USPL intends to mail the definitive proxy statement to its
stockholders of record in January or February 2002 soliciting
the stockholders' approval of the sale of Clean Earth, Inc. at
the special meeting of the stockholders that USPL intends to
hold in February 2002. At the same time, investors and security
holders may obtain a free copy of the preliminary proxy
statement and definitive proxy statement, and any other relevant
documents filed by USPL with the Securities and Exchange
Commission, when they become available at the website of the
Securities and Exchange Commission (
Further, stockholders can obtain USPL's notice of the special
meeting and the definitive proxy statement, when they become
available, for free from USPL by contacting Bruce C. Rosetto at

USPL and certain of USPL's executive officers and directors may
be deemed to be participants in the solicitation of proxies from
the stockholders of USPL in favor of the sale of Clean Earth,
Inc. The executive officers and directors of USPL who may be
participants in the solicitation of proxies in connection with
the sale of Clean Earth, Inc. have not been determined as of the
date of this press release. A description of the interests of
USPL's executive officers and directors in USPL, as of the date
of such filing, is set forth in USPL's definitive proxy
statement for the annual meeting of stockholders held on May 31,
2001. Investors and security holders may obtain more current
information regarding the direct and indirect interests of
USPL's executive officers and directors by reading the
preliminary proxy statement and the definitive proxy statement
in connection with the sale of Clean Earth, Inc. when such
documents become available.

UPRIGHT INC: Files Joint Plan of Reorganization in California
UpRight, Inc., announced that a Joint Plan of Reorganization has
been filed by the Company with U.S. Bankruptcy Court for the
Eastern District of California, Fresno Division.

The Plan has been filed in conjunction with UpRight's parent,
W.R. Carpenter North America, Inc., which also filed a voluntary
chapter 11 petition today. This action is part of the overall
strategy designed to enable the reorganized entities to emerge
from Chapter 11 in the first half of 2002.

UpRight filed voluntary chapter 11 petition in mid-June 2001.
Since then the Company re-commenced production in early July,
and has continued uninterrupted since then. Product support,
warranty coverage, parts availability, sales and service
coverage have also been uninterrupted.

"In the past two months UpRight has announced a long term supply
agreement with a large global organization and has been
appointed a primary supplier for two major rental companies,"
commented Leigh Sparrow, V.P. Global Sales and Distribution. "We
also believe that with our global distribution network, full
product line, the UpRight reputation and modern production
facilities, we will be well placed to benefit from the upturn in
our industry that is expected to occur during the latter half of

"The Joint Plan of Reorganization filed [Wednes]day is the
result of extensive negotiations with the Committee of Unsecured
Creditors appointed in the UpRight case. This Plan has the full
support of the Committee and the equity holders of the
companies, and will result in very substantial distributions to
our creditors," commented Ian Menzies, President and CEO of
UpRight. "We further believe that the Plan, when implemented,
will create a sound capital structure with the merger of UpRight
and W.R. Carpenter. The ongoing enterprise will preserve hundred
of jobs, maintain relationships with vendors and make
distributions to creditors substantially in excess of that which
could be made under any other alternatives."

VENTAS: Will Use Cash & Kindred Shares for 4th Quarter Dividend
Ventas, Inc. (NYSE:VTR) said that the Company's previously
announced fourth quarter dividend of $0.26 per share would be
paid through a combination of cash and shares of common stock in
its primary tenant Kindred Healthcare, Inc. (Nasaq:KIND). For
every 200 shares of Ventas common stock, stockholders will
receive one share of Kindred common stock and $0.98 in cash. In
addition, stockholders will receive cash for all shares of
Ventas stock that are not exact multiples of 200. Stockholders
who own fewer than 200 shares of Ventas stock will receive all
cash. For purposes of this dividend, the Kindred stock was
valued on December 31, 2001 at $51.02 per share.

Ventas's fourth quarter 2001 dividend is composed of the regular
$0.22 per share dividend and a one-time adjustment of $0.04 per
share. The dividend is payable on January 7, 2002 to
stockholders of record on December 14, 2001.

"Distributing a portion of our stake in Kindred to our
stockholders enables the Company to use available cash on hand
to reduce both the amount and the cost of our debt," Ventas CEO
and President Debra A. Cafaro said. "In addition, this dividend
allows Ventas stockholders to benefit directly from any further
improvements in Kindred's performance and valuation."

Ventas received 1,498,500 shares of Kindred common stock in
conjunction with the successful restructuring of Kindred when it
emerged from Chapter 11 bankruptcy on April 20, 2001. In
November 2001, Ventas sold 83,300 of its Kindred shares in
Kindred's public offering.

Ventas also said that the common stock dividends it paid or
declared for 2001, including the dividend to be paid on January
7, 2002 to shareholders of record on December 14, 2001, qualify
to be treated as ordinary income in 2001, in accordance with
Internal Revenue Code Section 857 governing REITs (real estate
investment trusts). Shareholders are encouraged to consult with
their personal tax advisors as to their specific tax treatment
of the Ventas dividends.

            Ventas Reduces Leverage And Cost Of Debt

Ventas said that, on December 31, 2001, it paid $10 million to
reduce the outstanding principal balance of its Amended Credit
Agreement to $623 million. The remaining principal balance is
composed of $150 million in Tranche B debt, due December 31,
2005, priced at LIBOR plus 325 basis points and $473 million in
Tranche C debt, due December 31, 2007, priced at LIBOR plus 425
basis points. The Tranche B spread was reduced by 50 basis
points with the payment of $10 million of Tranche B debt on
December 31, 2001. With the Company's recently completed
Commercial Mortgage Backed Securitization (CMBS) transaction,
Ventas has reduced its weighted, all-in cost of debt to 5.6
percent (or 9.5 percent taking into account the Company's 5.985
percent LIBOR swap).

At December 31, 2001, the Company's long-term debt totaled $848
million, reflecting $38 million in aggregate debt paydown during
2001. At December 31, 2001, the Company had unrestricted cash
reserves of approximately $18 million and restricted cash of
approximately $20 million.

"Entering 2002 with reduced leverage and a lower cost of debt
accomplishes a significant milestone for Ventas, and sets the
stage for the Company to implement its business strategy of
disciplined, intelligent diversification," Cafaro said.

            Ventas Drip Available For 2002 Dividends

Ventas also said that the registration statement for its
Distribution Reinvestment and Stock Purchase Plan, previously
announced in July 2001, was declared effective by the Securities
and Exchange Commission on December 31, 2001. Ventas
stockholders may participate in the Plan beginning with the
first quarterly dividend for 2002.

Under the Plan's terms, existing stockholders may purchase
shares of common stock in Ventas by reinvesting all or a portion
of the cash distribution on their shares of Ventas common stock.
In addition, existing Ventas stockholders as well as new
investors may purchase shares of common stock in Ventas by
making optional cash payments. Information about the Plan will
be mailed to stockholders in January 2002.

           Thompson Promoted To Executive Vice President
                     And Chief Investment Officer

Ventas announced that John C. Thompson has been promoted to
Executive Vice President -- Chief Investment Officer, effective
immediately. In his new position, Thompson will lead the
Company's diversification efforts. Since 1998, Thompson, 34, has
been a vice president at Ventas, where he has played a
significant role in the restructuring of the Company's primary
tenant, as well as Ventas's refinancing efforts and its asset-
repositioning program.

"John has been a tremendous asset to the Company over the past
two years, and we are delighted he will now turn his full
attention to the responsibilities of overseeing the Company's
diversification efforts and building a team of experienced
healthcare investment professionals," Cafaro said.

Ventas, Inc. is a healthcare real estate investment trust whose
properties include 44 hospitals, 216 nursing homes and eight
personal care facilities in 36 states. Its website can be found

VIZACOM INC: Completes Acquisition of SpaceLogix Assets
Vizacom Inc. (Nasdaq: VIZY), a provider of professional internet
and technology solutions, announced that it has consummated its
acquisition of SpaceLogix, Inc., a New York City-based
privately held company specializing in co-location, hosting and
network management solutions.  At a special meeting of
stockholders, Vizacom's stockholders approved its issuance of
stock in this transaction, and also approved the other two
proposals before them, to increase the shares available
for grant under Vizacom's 2000 Equity Incentive Plan and to
issue an aggregate of 209,580 shares to Vincent DiSpigno and
David Salav pursuant to a purchase price adjustment under the
agreement under which they sold PWR Systems to Vizacom.

In connection with the SpaceLogix acquisition, Vizacom issued to
the SpaceLogix stockholders 1,950,000 shares of its common stock
and above-market warrants and options to purchase 625,656 shares
of its common stock.

In additional news, Vizacom also announced that:

      -- it has hired Paul Block, former Chairman and President
of Revlon International, as Executive Vice President of
Marketing and Administration, and has entered into a two-year
employment agreement with him;

      -- it had raised $150,000 from the private sale of a
convertible note;

      -- three directors have agreed to defer payment under notes
due to them until the earlier of March 1, 2002 or the first
closing under the Company's anticipated equity private
placement; and

      -- the employment of Andrew Edwards, the former president
of the Company's Vizy Interactive-New York subsidiary, has been
terminated, and the terms of his employment agreement have been

Vincent DiSpigno, Vizacom's president, stated that "We expect
that SpaceLogix's co-location and network services businesses
will compliment and strengthen the comprehensive data center and
professional services businesses of our PWR Systems subsidiary.
This should further develop our presence in these markets and
facilitate the accomplishment of our goal of generating a higher
percentage of our revenues from higher margin services business.
We believe that SpaceLogix's key employees provide us with the
resources to manage our growth in these areas.  We are also
thrilled to add a talented senior executive like Paul Block to
our management team, and we expect that he will greatly assist
us in achieving our goals."

Vizacom Inc., is a provider of comprehensive professional
internet and technology solutions.  Vizacom develops and
provides to global and top domestic companies a range of service
and product solutions, including: creative media solutions,
systems and network development and integration, telco grade,
carrier-neutral co-location services and managed network.
Vizacom attracts top, established companies as clients,
including: Martha Stewart Living, Verizon Communications, Sony
Music, Consolidated Edison and Morgan Stanley's Metronexus. At
the end of September 2001, Vizacom reported that its liquidity
was strained, with working capital deficit of about $2.3
million. Visit

VLASIC FOODS: Retiree Panel Gets Okay to Hire Heiman as Counsel
The Court authorizes the Committee of Retired Employees of
Vlasic Foods International, Inc., to employ and retain Heiman
Aber, Goldlust & Baker as its counsel, nunc pro tunc to October
11, 2001 -- the date of the Committee's formation. (Vlasic Foods
Bankruptcy News, Issue No. 17; Bankruptcy Creditors' Service,
Inc., 609/392-0900)

W.R. CARPENTER: Files for Chapter 11 Reorganization in Fresno
W.R. Carpenter North America, Inc., announced that it intends to
reorganize under chapter 11 of the U.S. Bankruptcy Code, and has
filed a voluntary chapter 11 petition with the U.S. Bankruptcy
Court for the Eastern District of California, Fresno Division.

In addition, the Company announced that it had filed a Joint
Plan of Reorganization with its subsidiary, UpRight, Inc.  On
June 12, 2001, W.R. Carpenter announced that UpRight had filed a
voluntary chapter 11 petition with the Bankruptcy Court.

W.R. Carpenter has serves as a holding company for its operating
subsidiary, UpRight, Inc., a manufacturer of aerial work
platforms, which are distributed through a network of domestic
and international dealers and industrial equipment rental
companies. The Company is headquartered in Selma, California.

W.R. CARPENTER: Chapter 11 Case Summary
Debtor: W.R. Carpenter North America, Inc.
         aka The Repair Center
         1775 PARK ST
         SELMA, CA 93662

Bankruptcy Case No.: 01-61990

Chapter 11 Petition Date: December 31, 2001

Court: Eastern District Of California (Fresno)

Judge: Whitney Rimel

WHEELING-PITTSBURGH: Lease Decision Period Extended to June 7
Since the Petition Date, Wheeling-Pittsburgh Steel Corp., and
its debtor-affiliates have been dealing with a multitude of
complex supply, employee and contract issues that typically
arise in large and complicated chapter 11 cases. Simultaneously,
the Debtors have been stabilizing operations and working towards
the ultimate goal of constructing a plan of reorganization by:
(a) working diligently to determine whether any third parties
have an interest in acquiring all or a part of the Debtors or
their facilities, and (b) investigating thoroughly various
possible reconfigurations of the Debtors' business that would
support continued operation as a stand-alone business.

The Debtors remind the Court that they have been working
diligently to continue to stabilize operations, reduce costs,
and construct a plan or plans of reorganization.  In addition,
the Debtors have proposed a settlement with WHX Corporation, and
a sale of the assets of Pittsburgh-Canfield to WHX Corporation.

The sheer size and volume of these chapter 11 cases and the
complex nature of the reorganization issues involved justify a
further extension of the period provided under the Code to
assume or reject. In addition, the decision to assume or reject
the leased properties is central to any plan or plans of
reorganization, but the Debtors have not had the time necessary
to intelligently appraise their financial situation and the
potential value of their assets in terms of the formulation of a
plan of reorganization.  The leased properties constitute a
number of business properties and the Debtors need additional
time to determine whether to assume or reject these leases.

The Debtors assure Judge Bodoh that, to the best of the Debtors'
knowledge, they have complied with all of their postpetition
obligations under the leases, and are paying their other
postpetition obligations as they become due, negotiating in good
faith with their creditors, keeping the Official Committees
fully apprised of their work and progress toward reorganization,
and are not seeking the extension to pressure creditors into
accepting an unsatisfactory plan.

Based on these arguments, Judge Bodoh held that the Debtors make
their case for a further extension of their time to decide
whether to assume or reject unexpired leases of non-residential
real property for an additional 180 days, to and including June
7, 2002. (Wheeling-Pittsburgh Bankruptcy News, Issue No. 15;
Bankruptcy Creditors' Service, Inc., 609/392-0900)

* Turnaround Firm JW & Company Opens Offices in Delaware Valley
JW & Company, a corporate renewal/turnaround-consulting firm,
opened its doors for business in the summer of 2001. Jack
Wisniewski, a turnaround CEO/COO in the capital equipment, metal
and plastics industries, formed JW & Company. As a well-known
executive in manufacturing, he has been the past recipient of
"The Philadelphia Quality Award," "The New Jersey Governor's Cup
for Entrepreneurial Excellence," and a finalist for the "Malcolm
Baldrige National Quality Award".

The mission of JW & Company is to provide middle market
manufacturing companies with the highest level of corporate
renewal services, drawing upon the founder's 25 years of
successful experience in turning around private and public
companies. These services include: interim CEO/COO
services, turnaround management, and growth management through
acquisitions and internal sales. As a manufacturing business
expert, Mr. Wisniewski has serviced markets from shipbuilding,
power generation, automotive, to medical scientific,
telecommunication, through to high tech electro-mechanical
assemblies. The company has affiliations with several different
service providers such as Cost Technology, Inc., founded by Dr.
Peter B. B. Turney, providing Activity Based Costing and
Activity Based Management services internationally.

"The present economy encourages under performing companies to
reevaluate their business strategy," Mr. Wisniewski stated.
"This creates an opportunity for organizations like JW & Company
to redirect the business model of client companies, to produce
value for their customers, shareholders and employees."

* BOOK REVIEW: Creating Value through Corporate Restructuring:
                Case Studies in Bankruptcies, Buyouts, and
Author:  Stuart C. Gilson
Publisher:  Wiley
Hardcover:  516 pages
List Price:  $79.95
Review by David M. Henderson
Buy a copy for yourself and one for a colleague on-line at:

Most business books fall into two categories.  The first is very
important. It is like that stuff you have to drink before you
have a colonoscopy.  You keep telling yourself, this is very
good for me, while you would rather be at the beach reading
Liar's Poker or Barbarians at the Gate.

Stuart Gilson, of the Harvard Business School, has managed to
write a book important to everybody in the distressed market
that is also quite enjoyable.  His prose is fluid and succinct
and a pleasure to read.  But don't take my word for it.  The
dust jacket endorsements come from Jay Alix, Martin Fridson,
Harvey Miller, Arthur Newman, and Sanford Sigoloff.  At a
collective gazillion dollars a billing hour, that's a lot of

Be advised that this is designed as a text book.  The case study
format might be off-putting to some.  The effect can be jarring
as you read the narrative history of the case and suddenly
confront the financial statements without any further clue as to
what to do, but this must be what it is like for the turnaround
manager.  Even after reading several of the cases, when I got to
the financials I had that sinking feeling of, what do I do now?
If you read carefully, clues to the solutions are in the

The book is divided into three "modules", bizspeek for sections:
Restructuring Creditors' Claims,. Restructuring Shareholders'
Claims, and Restructuring Employees' Claims. The text covers 13
corporate restructurings focusing on debt workouts, vulture
investing, equity spinoffs, tracking stock, assete divestitures,
employee layoffs, corporate downsizing, M & A, HLTs, wage give-
backs, employee stock buyouts, and the restructuring of employee
benefit plans.  That's a pretty comprehensive survey, wouldn't
you say?

Dr. Gilson's chapter on "Investing in Distressed Situations" is
an excellent summary of the distressed market and a good
touchstone even for seasoned vultures.

Even in the two appendices on technical analysis, this book is
marvelously free of those charts and graphs that purport to show
some general ROI of distressed investing.  Those are cute,
aren't they?  As Judy Mencher has famously said, "You can buy
the paper at 50 thinking it's going to 70, but it can just as
easily go to 30 if you are not willing to act on it."  Therein
lies the rub and the weakness, if inevitable, of this or any
book on corporate restructurings.  As Dr. Gilson notes, no two
are alike, and the outcome is highly subjective, in our out of
Court, but especially in Chapter 11. Is the Judge enthralled by
Jack Butler as Debtor's Counsel or intimidated by Harvey Miller
as Debtor's Counsel?  Are you holding "secured" paper only to
discover that when it was issued the bond counsel forgot to
notify the Indenture Trustee of the most Senior debt?    Is
somebody holding Junior paper that you think is out of the money
only to have Hugh Ray read the fine print and discover that the
"Junior" paper is secured?  This is the stuff of corporate
reorganizations that is virtually impossible to codify into a

That said, this is an especially valuable text for anybody
working in the distressed market.  As a Duke grad, I tend to be
disdainful of all things Harvard, but having read Dr. Gilson's
book, I am enticed to encamp by the dirty waters of the Charles
long enough to take his course, appropriately entitled,
"Creating Value Through Corporate Restructuring."


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

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

Bond pricing, appearing in each Thursday's edition of the TCR,
is provided by DebtTraders in New York. DebtTraders is a
specialist in global high yield securities, providing clients
unparalleled services in the identification, assessment, and
sourcing of attractive high yield debt investments. For more
information on institutional services, contact Scott Johnson at
1-212-247-5300. To view our research and find out about private
client accounts, contact Peter Fitzpatrick at 1-212-247-3800.
Real-time pricing available at

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

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


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

Troubled Company Reporter is a daily newsletter co-published by
Bankruptcy Creditors' Service, Inc., Trenton, NJ USA, and Beard
Group, Inc., Washington, DC USA. Yvonne L. Metzler, Bernadette
C. de Roda, Ronald P. Villavelez and Peter A. Chapman, Editors.

Copyright 2002.  All rights reserved.  ISSN: 1520-9474.

This material is copyrighted and any commercial use, resale or
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                      *** End of Transmission ***