TCR_Public/020704.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

             Thursday, July 4, 2002, Vol. 6, No. 131

                          Headlines

3DO COMPANY: Completes New Financing Arrangement with GE Capital
360NETWORKS: Still Not Publishing Financial Results
ACT MANUFACTURING: Benchmark Electronics to Buy Thai & UK Ops.
ANC RENTAL: Consolidating Operations at Reno/Tahoe Int'l Airport
ACCUHEALTH: Court Ends Donlin Recano Engagement as Claims Agent

ACME METALS: Court Approves DIP Facility Amendment
ADELPHIA COMMS: Hires Willkie Farr as Bankruptcy Counsel
AMERICA WEST: Revenue Passenger Miles Jump 2.3% in June
AMERICO LIFE: Fitch Puts Sub. Debt and Issuer Ratings at BB
AQUIS COMMS: Reaches Debt Restructuring Agreement with Lenders

AREMISSOFT CORP: N.J. Court Confirms Plan of Reorganization
ARMSTRONG: Trafalet Wins Nod to Hire PJ Solomon as Fin'l Advisor
BEYOND.COM: Selling GSG Assets & Contracts to Softchoice for $3M
CJF HOLDINGS: Chapter 7 Trustee Signs-Up Mihlstin as Accountant
CARIBBEAN PETROLEUM: Seeks 2nd Lease Decision Period Extension

CENTERPOINT FUNDING: Fitch Lowers Several Transactions' Ratings
COHO ENERGY: Citation Oil Pitches Best Bid for OK & TX Assets
CORRPRO COMPANIES: Fails to Beat Form 10-K Filing Deadline
COVANTA ENERGY: Panel Asks Court to Modify Cash Collateral Order
ENRON CORP: LNG Unit Selling Hoegh Charter Contracts for $21.5MM

ENRON CORP: LNG Unit Wants to Sell Excalibur Charter Contracts
EXIDE: Appoints Janice M. Jones as EVP, Global Human Resources
FFC HOLDING: Wants Exclusive Period Maintained Until July 15
FIRST VIRTUAL: Fails to Meet Nasdaq Minimum Listing Requirements
FLAG TELECOM: Court Okays Blackstone Group as Financial Advisors

FLAG TELECOM: Files Disclosure Statement & Reorg. Plan in NY
FUELNATION: Convertible Noteholder Files Suit after Default
GLOBAL CROSSING: Goldin Seeks Stay Relief to Prosecute Claims
HMG WORLDWIDE: Wants Plan Exclusivity Stretched Until Aug. 19
IT GROUP: Shaw Registers Estates' 1.7 Million Shares

ITC LEARNING: Case Summary & 20 Largest Unsecured Creditors
INACOM CORP: Taps Werb & Sullivan as Special Delaware Counsel
INT'L THUNDERBIRD: Defaults on $2.88MM Loans with MRG Entities
INTERSTATE GENERAL: Cures Default on $4.4MM Promissory Note
KMART CORP: Equity Committee Taps Goldberg Kohn as Local Counsel

LAIDLAW INC: AMR Agrees to Pay $20MM to Settle Civil Claims
LAIDLAW INC: Expects to Release Fiscal 2001 Results by July 15
LODGIAN INC: Asks Court, Again, to Extend Exclusivity to Oct. 21
LORAL SPACE: Will Release Second Quarter Results By Month-End
MCCRORY: Secures OK to Hire New & Neville as Real Estate Broker

MICRO COMPONENT: Violates Nasdaq Continued Listing Guidelines
NATIONAL STEEL: Grants Bondholders & NUF Adequate Protection
NATIONSRENT: Balks At John Hancock's 2nd Request for Documents
NEON COMMS: Wants Court to Appoint BSI as Notice Agents
NOMURA CBO: S&P Hatchets Class A-3 Notes Rating to CCC from BB+

NOMURA CBO: S&P Slashes Class A-2 Notes Rating to BB-
PACIFIC GAS: Wins Nod to Execute Terms Re Forbearance By Banks
PANAVISION INC: Repurchases $37MM 9-5/8% Sr. Sub. Discount Notes
POLAROID: Wants to Continue Employee Severance Plan thru Sept 30
PRANDIUM INC: Court-Confirmed Plan Takes Effect July 2, 2002

PRIME RETAIL: Lender Extends Payment Due Date to August 15, 2002
PRIMUS TELECOMMUNICATIONS: Expands Mobile Gateway Service
RANOR INC: Seeking Nod to Use Secured Lenders' Cash Collateral
REPUBLIC TECHNOLOGIES: Will Auction-Off Assets on Monday
SLI INC: Senior Bank Lenders Agree to Forbear Until July 31

SHOPKO STORES: Fitch Affirms Low-B Ratings on Facility & Notes
SPORTS AUTHORITY: Moody's Reviewing Low-B's for Possible Upgrade
SWAN TRANSPORTATION: Panel Taps Anderson as Insurance Counsel
SYSTEMAX INC: In Default Under Revolving Credit Agreement
TANDYCRAFTS: Wants to Tap Environmental Strategies as Consultant

US AIRWAYS: Fisher Asks Pres. Bush to Back $900MM Loan Guarantee
VIASYSTEMS GROUP: Moody's Further Junks $500MM Senior Sub. Notes
WASH DEPOT: Wants Until Sept. 3 to Make Lease-Related Decisions
WILLIAMS COMMS: Bittners Doubt Intentions in Bankruptcy Filing
WORLD AIRWAYS: Applies for $27 Million Federal Loan Guarantee

WORLDCOM: S&P Lowers Four Related Synthetic Deals' Junk Ratings
WORLDCOM: Bank Lenders Formally Declare $4.25BB Loan Defaults
WORLDCOM: Stratecast Says Crisis Will Cause Market Share Shifts
XO COMMUNICATIONS: Honoring Prepetition Employee Obligations
XO COMMS: Launches New Suite of Programs to Deliver More Choices

Z-TEL TECHNOLOGIES: Fails to Meet Nadaq Listing Requirements

* Jay Alix & Associates Changes Name to AlixPartners LLC
* O'Melveny & Myers Intends to Merge with O'Sullivan LLP

* DebtTraders' Real-Time Bond Pricing

                          *********

3DO COMPANY: Completes New Financing Arrangement with GE Capital
----------------------------------------------------------------
The 3DO Company (Nasdaq: THDO) has entered into a two-year
Revolving Credit Loan and Security Agreement on June 27, 2002
with GE Capital Commercial Services, Inc.  The Agreement with GE
Capital Commercial Services, Inc. is a $15 million line with
seasonal sub-limits and interest at a floating rate equal to
their index rate plus .75%.  Domestic receivables, inventories
and certain other assets secure advances made under the line.

As described in the recent 10-K filing of the company, the
credit line agreement requires the company to raise an
additional $4.6 million in equity or subordinated debt by
October 1, 2002.  Trip Hawkins, the Chairman and Chief Executive
Officer of 3DO, has indicated that he will personally provide
the $4.6 million in financing if necessary.  The company expects
that it can complete this financing and that by doing so the
company hopes to adequately meet the working capital funding
needs of the company for the balance of Fiscal Year 2003 as the
company pursues a return to profitability.

"This agreement represents an important step for increased
liquidity to meet our upcoming seasonal financing needs,"
Hawkins said.  "This new funding improves our financial position
and should provide both our customers and vendors with a comfort
level they need to continue extending credit and depending on
3DO for Fiscal 2003.  Our financing goals are to strengthen our
balance sheet, reduce our risks as a going concern, and put
ourselves in position to deliver on our growth and profit plans
for next year.  Our auditors have taken a conservative view
regarding the risks we face, which is understandable in this
business climate.  However, we feel that the company is in a
much better position than it was in last year or the year before
and we expect that we can finance the company's needs, which, as
a result of our improved operations, are far more modest than in
prior years."

The 3DO Company, headquartered in Redwood City, Calif.,
develops, publishes and distributes interactive entertainment
software for personal computers, the Internet and advanced
entertainment systems such as the PlayStation(R)2 computer
entertainment system, the Nintendo GameCube(TM) and the Game
Boy(R) Advance systems.

                         *    *    *

As reported in Troubled Company Reporter's June 28, 2002
edition, The 3DO Company disclosed that because its common stock
price has remained below $1.00 per share, it is not currently in
compliance with Nasdaq's minimum bid price requirement (Nasdaq
Marketplace Rule 4450(a)(5)). The Company received a Nasdaq
staff determination indicating non-compliance on June 21, 2002.
As a result, its securities are subject to delisting from the
Nasdaq National Market. The Company, however, intends to request
a hearing regarding the Nasdaq staff determination and will
present its plan of action, which may include a reverse stock
split, to maintain compliance with the Nasdaq National Market
continued listing standards. The request for a hearing will
suspend the delisting action until the Nasdaq Listing
Qualifications Panel reaches a final decision on the Company's
appeal, but there can be no assurance that the Panel will decide
in the Company's favor.


360NETWORKS: Still Not Publishing Financial Results
---------------------------------------------------
360networks announced the company continues to defer the
issuance of its 2001 annual and first quarter 2002 financial
results, and the related management's discussion and analysis.
The statements were due on May 21, 2002 and May 30, 2002
respectively.

As announced previously, the company continues to develop a plan
of reorganization with its senior bank lenders and unsecured
creditors. Until a plan is finalized, 360networks is unable to
complete the applicable financial statements and related
documents.

360networks is complying with the provisions of the Alternate
Information Guidelines contained in the Ontario Securities
Commission Policy 57-603, which includes issuing a default
status report every two weeks.

Monthly reports filed by the Canadian court-appointed Monitor
about 360networks' operations, finances and restructuring
efforts are available in the Restructuring section of the
company's Web site at http://www.360.net

360networks offers optical services and network infrastructure
to telecommunications and data communications companies in North
America. The company's optical mesh fiber network is one of the
largest and most advanced on the continent, spanning
approximately 40,000 kilometers (25,000 miles) and connecting
more than 50 major cities in the United States and Canada.

On June 28, 2001, the company and several of its operating
subsidiaries voluntarily filed for protection under the
Companies' Creditors Arrangement Act (CCAA) in the Supreme Court
of British Columbia. Concurrently, the company's principal U.S.
subsidiary, 360networks (USA) inc., and 22 of its affiliates
voluntarily filed for protection under Chapter 11 of the U.S.
Bankruptcy Code in the U.S. Bankruptcy Court for the Southern
District of New York. In October 2001, four operating
subsidiaries that are part of the 360atlantic group of companies
also voluntarily filed for protection in Canada. Insolvency
proceedings for several subsidiaries of the company have been
instituted in Europe and Asia. Additional information is
available at http://www.360.net


ACT MANUFACTURING: Benchmark Electronics to Buy Thai & UK Ops.
--------------------------------------------------------------
Benchmark Electronics, Inc. (NYSE: BHE) and ACT Manufacturing,
Inc. (OTC Pink Sheets: ACTMQ) have signed a Stock Purchase
Agreement in which Benchmark will acquire the stock of ACT
Manufacturing Thailand Public Company Limited and ACT
Manufacturing UK Ltd.  In previous press releases, ACT
Manufacturing, Inc. announced that it had entered into a
voluntary Chapter 11 bankruptcy process and had received court
approval to conduct an auction process, at which Benchmark
prevailed.

The transaction has been approved by the United States
Bankruptcy Court for the District of Massachusetts.  The
transaction is currently expected to close in July 2002, subject
to certain closing conditions.

The purchase price of $45.2 million will be funded through
Benchmark's currently available cash.  The transaction includes
the assumption of approximately $15 million of net debt under an
interest-bearing debt facility. Based on recent financial
information, Benchmark currently expects annual revenues from
this acquisition to be between $180 and $200 million.  On that
basis, the transaction is currently expected to be slightly
accretive to Benchmark's 2002 earnings, before any one-time
transaction and related charges.

Cary T. Fu, President and Chief Operating Officer of Benchmark
Electronics, Inc., said, "These acquisitions meet several of our
long range strategic objectives.  They will provide Benchmark
with a strong high-technology manufacturing presence in Asia and
several new customers in the medical, telecommunications and
industrial control industries."  Cary Fu added, "Both Benchmark
and ACT have very customer-focused cultures.  We welcome our new
customers, employees and suppliers and are committed to
achieving a smooth transition."

John Pino, Chief Executive Officer of ACT Manufacturing, Inc.,
said, "We are very pleased with the results of our court
approved auction process and are extremely excited that
Benchmark has emerged as the successful bidder to acquire our
Thailand and UK business operations."  He added, "Benchmark's
financial strength and engineering expertise will provide
excellent opportunities for ACT's customers, employees and
suppliers."

Benchmark Electronics, Inc. is in the business of manufacturing
electronics and provides its services to original equipment
manufacturers of telecommunication equipment, computers and
related products for business enterprises,
video/audio/entertainment products, industrial control
equipment, testing and instrumentation products and medical
devices.  Benchmark's global operations include facilities in
six countries.  Benchmark's Common Stock trades on the New York
Stock Exchange under the symbol BHE.

ACT Manufacturing, Inc., with headquarters in Hudson,
Massachusetts, provides electronics manufacturing services to
equipment manufacturers in networking and telecommunications,
computer and industrial and medical equipment markets.  ACT
provides OEMs with complex printed circuit board assembly
primarily utilizing advanced surface mount technology, electro-
mechanical subassembly, total system assembly and integration,
mechanical and molded cable and harness assembly and other
value-added services.


ANC RENTAL: Consolidating Operations at Reno/Tahoe Int'l Airport
----------------------------------------------------------------
ANC Rental Corporation and its debtor-affiliates want to reject
the National Concession and Lease Agreement and the National
Participation Agreement and, at the same time, assume the Alamo
Concession and Lease Agreement and the Alamo Participation
Agreement and assign them to ANC.  The agreements were entered
into by the Debtors with the Airport Authority of Washoe County,
a quasi-municipal corporation existing under the laws of the
State of Nevada, for the operation of the Debtors' brand names
at the Reno/Tahoe International Airport in Reno, Nevada.

Mark J. Packel, Esq., at Blank Rome Comisky & McCauley LLP in
Wilmington, Delaware, makes it clear that the concession
agreements do not prohibit dual branding by the concessionaire.

According to Mr. Packel, the participation agreements, both
dated April 1998, were entered into by each National, Alamo and
other concessionaires at the Reno Airport, under which they
agreed to construct a Quick Turnaround Area at the Reno Airport.

Mr. Packel relates that National owes the airport authority
$58,342 in prepetition expenses and $105,003 in postpetition
expenses.  Alamo, meanwhile, owes the airport authority $97,786
in prepetition expenses and is owed a post-petition credit of
$13,533.86 by the Authority.

Mr. Packel assures the Court that the Debtors have recognized
that they must cure, or provide adequate assurance that they
will promptly cure, all defaults existing under the Alamo
Concession and Lease Agreement and the Alamo Participation
Agreement.  The Debtors will also be paying all unpaid
postpetition amounts due and owing under the Alamo Concession
and Lease Agreement and the Alamo Participation Agreement.

Upon approval of the motion, Mr. Packel says that the airport
authority will make a claim, in the amount of the prepetition
debt against the Performance Bond that was posted by National
pursuant to the National Concession and Lease Agreement.  Upon
satisfaction of the pre-petition debt, the airport authority
will promptly release and return to National the Performance
Bond, marked "cancelled."  The Debtors, in addition, will pay
the airport authority any postpetition debt.

Mr. Packel believes that the approval of the Motion will give
the Debtors over $1,309,000 per year in fixed facility costs and
other operational cost savings. (ANC Rental Bankruptcy News,
Issue No. 15; Bankruptcy Creditors' Service, Inc., 609/392-0900)


ACCUHEALTH: Court Ends Donlin Recano Engagement as Claims Agent
---------------------------------------------------------------
Mark S. Tulis, the Chapter 7 Trustee supervising the liquidation
of Accuhealth, Inc., and the U.S. Trustee, in consultation with
the Clerk of Court, determined that these chapter 7 proceedings
no longer require the assistance of an outside claims agent.
For this reason, the Court ordered the termination of the
services of Donlin, Recano & Company, Inc., effective June 12,
2002.

Donlin Recano is directed to prepare a final claims registers
for the Clerk's Office and transport the claims to the Clerk of
the Court.

Before filing for bankruptcy, Accuhealth, Inc., was engaged in
the business of providing home health care services in the New
York metropolitan area. Gerard Sylvester Catalanello, Esq.,
James J. Vincequerra, Esq., at Brown Raysman Millstein Felder &
Steiner and Martin A. Mooney, Esq. at Deily, Dautel & Mooney,
LLP represent the Debtors as they wind-up their financial
affairs.


ACME METALS: Court Approves DIP Facility Amendment
--------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware approved
an extension of Acme Metals Incorporated's existing post-
petition credit facility with Bank America, NA.  The Court
authorized the amendment and extension until the earlier of:

     i) August 31, 2002,

    ii) the date that all letters of Credit which are
        outstanding on May 31, 2002 are returned to Bank of
        America and cancelled, and

   iii) the date no Letter of Credit are outstanding and all
        obligations have been paid.

The requested extension and amendment is for the sole and
exclusive purpose of securing the Acme Debtors' reimbursement
obligation for a certain $1 million Letter of Credit previously
issued under the Existing Facility.

The terms of the requested amendment and extension include a
monthly extension fee of $75,000.

Acme Metals, together with its debtor-affiliates, filed for
chapter 11 bankruptcy protection on September 28, 1998. Brendan
Linehan Shannon, Esq., and James L. Patton, Esq., at Young,
Conaway, Stargatt & Taylor represent the Debtors in their
restructuring efforts. When the company filed for protection
from its creditors, it listed assets of $813 million and
liabilities of $541 million.


ADELPHIA COMMS: Hires Willkie Farr as Bankruptcy Counsel
--------------------------------------------------------
By its application and pursuant to Section 327(a) of the
Bankruptcy Code, as modified by Section 1107(b), Adelphia
Communications seeks to employ Willkie Farr & Gallagher as their
attorneys under a general retainer to perform the legal services
necessary to prosecute their chapter 11 cases.

Randall D. Fisher, ACOM's Vice President and General Counsel,
recounts that on March, 2002, Willkie was retained by the ACOM
Debtors to represent them in Adelphia Business Solutions'
dueling chapter 11 proceedings.  Apart from the ABIZ matter, in
May 2002, the ACOM Debtors asked Willkie to assist them in
negotiating and implementing their own debt restructuring and,
if necessary, to file cases under chapter 11 of the Bankruptcy
Code.  Ultimately, the ACOM Debtors' out-of-court restructuring
efforts proved unsuccessful and the Debtors determined the most
prudent course of action was to file these cases.  Accordingly,
the Debtors expanded the scope of Willkie's services to include
the preparation of and, subject to entry of an order approving
the retention of Willkie, the prosecution of these chapter 11
cases.

The Debtors desire to retain Willkie to continue to provide such
other legal services as are necessary and requested by the ACOM
Debtors, including, without limitation, tax, real estate,
corporate finance, employee benefits and litigation services
relating to the Debtors' reorganization.  Mr. Fisher explains
that the ACOM Debtors have selected Willkie because it is
familiar with the Debtors' operations and businesses and
Willkie's attorneys have extensive experience and knowledge in
the fields of debtors' and creditors' rights, general corporate
and securities law, debt restructuring and corporate
reorganizations, tax law, real estate, employee benefits and
commercial litigation, among others.  Therefore, the ACOM
Debtors believe that Willkie is well qualified to represent them
in these cases.

Specifically, Willkie will:

A. provide advice, representation, and preparation of necessary
   documentation regarding financing, real estate, employee
   benefits, business and commercial litigation, tax, debt
   restructuring, bankruptcy and, if requested, asset
   dispositions;

B. take all necessary actions to protect and preserve the
   Debtors' estates during the pendency of their chapter 11
   cases, including the prosecution and defense of actions in
   which the Debtors are parties, negotiation concerning
   litigation in which the Debtors are involved, and prosecution
   of objections to claims filed against the estates;

C. prepare necessary motions, applications, answers, orders,
   reports and papers in connection with the administration of
   these chapter 11 cases;

D. assist in the negotiation and preparation of a plan of
   reorganization and accompanying disclosure statement;

E. counsel the Debtors with regard to their rights and
   obligations as debtors in possession; and

F. perform all other necessary legal services.

Marc Abrams, Esq., leads the Willkie Farr team representing
ACOM.  Mr. Abrams assures the Court that Willkie's members and
associates do not have any connection with the Debtors, their
creditors or any other party in interest, or their respective
attorneys.  Accordingly, Willkie is "disinterested" and does not
hold or represent an interest adverse to the Debtors' estates.
However, Willkie currently represents or in the past has
represented several parties-in-interests in matters unrelated to
these cases including:

A. Secured Lenders: ABN AMRO Bank N.V., Bank of America
   Securities LLC, Bank of New York, Bank of Nova Scotia, Bank
   of Tokyo Mitsubishi Trust Company, Bankers Trust Company,
   Banque Mees Pierson Gonet, Barclays Capital, BNP, Canadian
   Imperial Bank of Commerce, Chase Manhattan Bank, CIBC World
   Markets, Citicorp, Citibank, N.A., Corestates Bank, Credit
   Agricole Indosuez, Credit Lyonnais Americas, Credit Suisse
   First Boston, Deutsche Bank, DLJ Dresdner Bank, First
   Allamerica Financial Group, First Union National Bank, Fleet
   Securities, FleetBank Financial, General Electric Capital,
   Goldman Sachs, J.P. Morgan, Long-Term Credit Bank of Japan,
   Mellon Bank, N.A., Merrill Lynch, Morgan Guaranty Nippon
   Credit Bank Ltd., Pacific Life Insurance Company, PNC Bank,
   Royal Bank of Canada, Royal Bank of Scotland PLC, Salomon
   Brothers Holding Company Inc., Societe Generale, Sumitomo
   Trust and Banking Co. Ltd., TD Securities Inc., Travelers
   Insurance Company, and US Trust;

B. Indenture Trustees: Angelo Gordon & Co. L.P., Bank of
   America, Bank of New York, Oppenheimer & Co. Inc., and US
   Trust;

C. Other Creditors: AOL Time Warner, BankOne NA, Boeing,
   Clifford Chance, CNN, Deloitte & Touche LLP, Discovery
   Communications, Fox Sports Net, Home Box Office, in Demand,
   Lazard Freres, Morrison & Foerster, Motorola, National
   Broadcasting Company (NBC), Pepper Hamilton LLP,
   PricewaterhouseCoopers LLP, Schulte Roth & Zabel LLP,
   Speedvision Cable Programming Channel, Tech TV LLC, The
   Weather Channel, Tribune Media Services, Turner Broadcasting
   Company, Viacom International Inc., Weil Gotshal & Manges,
   Yankee Microwave Inc., and Quantum Corporate Funding Ltd.

Subject to Court approval, compensation will be payable to
Willkie on an hourly basis, plus reimbursement of actual and
necessary expenses incurred.  Willkie attorneys that are likely
to represent the Debtors in these cases have current standard
hourly rates ranging between $205 and $695.  The paralegals that
likely will assist the attorneys who will represent the Debtors
have current standard hourly rates ranging between $105 and
$145.

Since its initial retention, Mr. Abrams relates that Willkie has
received payments, including retainers, totaling $2,780,000.
(Adelphia Bankruptcy News, Issue No. 10; Bankruptcy Creditors'
Service, Inc., 609/392-0900)

Adelphia Communications' 10.875% bonds due 2010 (ADEL10USR1) are
quoted at a price of 42.25, DebtTraders reports. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=ADEL10USR1
for real-time bond pricing.


AMERICA WEST: Revenue Passenger Miles Jump 2.3% in June
-------------------------------------------------------
America West Airlines (NYSE: AWA) reported traffic statistics
for the month of June.  Revenue passenger miles (RPMs) for June
2002 were a record 1.8 billion, up 2.3 percent from June 2001.
The passenger load factor for the month of June was 76.7 percent
versus 78.1 in June 2001.  Capacity for June 2002 was a record
2.4 billion available seat miles (ASMs), up 4.1 percent from
June 2001.

America West also reported a record load factor for the second
quarter of 75.7 percent up 0.2 points over second quarter last
year.  RPMs decreased by 0.3 to 5.2 billion for the quarter.
ASMs decreased 0.7 percent from last year's second quarter to
6.9 billion for this year's quarter.

Year-to-date load factor was also a record of 73.1 percent, up
0.8 points from 2001.  Year-to-date revenue passenger miles were
9.4 billion, a 6.3 percent decrease from 2001.  Available seat
miles decreased 7.3 percent for the current year to 12.9
billion.

America West estimates that its June 2002 revenue per available
seat mile (RASM) declined versus June 2001 at approximately the
same rate as the U.S. domestic airline industry.  In April and
May, America West's year-over-year decline in RASM was
significantly less than the domestic industry average due to the
success of its new business-friendly pricing structure
introduced on March 24, 2002.  The June results continue to
reflect the significant benefits of the new pricing structure
but these benefits are somewhat offset by aggressive Southwest
Airlines pricing impacting America West markets beginning in
late May.

America West Airlines is the nation's largest low-fare, hub-and-
spoke airline.  Founded in 1983, it is the only carrier formed
since deregulation to achieve major airline status.  Today,
America West is the nation's eighth- largest carrier and serves
88 destinations in the U.S., Canada and Mexico. America West is
a wholly owned subsidiary of America West Holdings Corporation,
an aviation and travel services company with 2001 sales of
$2.1 billion.

As reported in Troubled Company Reporter's June 6, 2002 edition,
Standard & Poor's raised America West's junk corporate credit
rating to 'B-'.


AMERICO LIFE: Fitch Puts Sub. Debt and Issuer Ratings at BB
-----------------------------------------------------------
Fitch Ratings assigned a 'BB+' Long-Term issuer rating to
Americo Life, Inc. and a 'BB' subordinated debt rating to
Americo Life's $100 million 9.25% Senior subordinated notes, due
2005. The Rating Outlook is Positive.

In addition to the high credit quality and liquidity of Americo
Life's fixed income portfolio, the rating considers the
relatively high financial leverage at the holding company and
the insurance companies and the low level of consolidated
capital at the insurance companies.

Through its insurance subsidiaries, Americo Life offers
individual life insurance and individual annuities to select
markets. The products are distributed through independent
marketing organizations (IMOs) to the company's target markets
of individuals, public school teachers and administrators, and
seniors.

Historically, Americo Life's strategy was to acquire blocks of
insurance policies in order to develop sufficient scale. Once
the necessary scale was achieved, management shifted its focus
to growth through new policy sales. Beginning in 2001, Americo
Life focused all of its marketing efforts on Americo Financial
Life and Annuity Insurance Company (Americo Financial), which
was formerly known as The College Life Insurance Company. Fitch
believes that the company will be challenged with this growth
strategy because this market is a crowded one. Americo Life's
success is dependent upon successfully managing its
relationships with the IMOs.

GAAP revenue for Americo Life decreased by 6% during 2001 to
approximately $207 million. This was due in part to a decrease
in premiums from closed blocks of traditional life insurance and
lower surrender charges from annuities, offset by an increase in
premiums from pre-need insurance.

Historical earnings have been somewhat modest with return on
common equity, net of FAS 115 adjustments, averaging 6.9% over
the 1997 to 2001 period. In 2001, the company reported net
income after taxes of $12 million, compared to net income of $15
million in 2000. The decrease was due in large part to an
increase in death benefits and a decrease in surrender charge
income coupled with a restructuring charge incurred from closing
its Austin, Texas offices in 2001. Fitch believes that earnings
will increase in 2002 as a result of the restructuring.

Americo Life reported total assets of $4.4 billion and
shareholders' equity of $252.3 million at the end of 2001. The
company's total invested assets at year-end 2001 were allocated
mainly to fixed income securities, which represented 76% of the
total. Investments in mortgages and real estate accounted for
11%, policy loans 7%, equities 3%, and cash and short-term
investments 2%. Corporate securities represented the vast
majority of bond investments at 70%, with structured securities
accounting for the bulk of the remaining amount. The bond
portfolio had strong liquidity with 93% of bonds invested in
publicly traded securities and only 4% of bonds were rated below
investment grade.

Americo Life carries approximately $28 million of unaffiliated
assets at the holding company. This compares to total debt
obligations of $100 million, $8 million of which are owned by
life insurance subsidiaries. The holding company assets are
primarily equity investments. Fitch believes that maintaining
assets at the holding company is prudent given the restrictive
dividend limitations for insurance companies.

Americo Life's financial leverage is fairly high, with debt
representing 32% of total capital at year-end2001. This measure
has been trending downward during the last few years and the
company expects that it will decrease below 30% by the end of
2002. Fixed charge coverage was somewhat low at 2.9 times at the
end of 2001 and 3.9x at the end of 2000. Factoring out
restructuring charges incurred in 2001 would have resulted in
the fixed charge coverage equaling 3.9x for the year.

For the current rating levels, Fitch expects that Americo Life's
leverage will not markedly increase from its current level of
30% debt to total capital and a reduction in leverage has
positive implications for the assigned ratings. Additionally,
the composition of the investment portfolio should remain
basically unchanged; and an increase in GAAP profitability
should result in the return on equity reaching into the high
single digits in 2002. Fitch would view favorably the successful
management of IMO relationships that resulted in first year life
and annuity premium sales growth approximating that of the
industry.


AQUIS COMMS: Reaches Debt Restructuring Agreement with Lenders
--------------------------------------------------------------
Aquis Communications Group, Inc. (OTC Bulletin Board: AQIS)
entered into a Restructuring Agreement and a Securities Exchange
Agreement with its principal lenders, including Amro
International, which will provide, upon the completion of a
number of customary closing conditions, including the receipt of
requisite FCC approvals, for the entire restructuring of  Aquis'
debt.  Under the restructuring, the Company's senior lender will
exchange approximately $32.7 million in debt for a new
convertible preferred stock and warrants, which would represent
79.99 percent of the fully diluted shares of Aquis.  The new
convertible preferred stock and warrants will be issued to a
newly formed, wholly owned subsidiary of the Company's senior
lender.  The remaining debt payable to the Company's senior
lender, representing approximately $9 million, would be payable
over four years.  Aquis will also have the ability to have $2.0
million of this debt forgiven if it is successful in retiring
$7.0 million of its debt by a date certain.

The restructuring also contemplates that Aquis' subordinated
debt will be reduced from approximately $2.5 million to $1
million and in exchange, Amro would receive convertible
preferred stock and warrants, which would represent 9.9 percent
of the fully diluted shares of Aquis.  The restructuring finally
provides that the holders of the existing preferred stock will
receive $300,000 in new non-convertible preferred stock.
Existing common stockholders would retain 10.11 percent of the
outstanding common stock of the restructured company.

Aquis' debt restructure provides a foundation for long term
financial stability and a solid balance sheet.

"We are very pleased that our senior lender and the other debt
lenders have enough confidence in the long term prospects of the
Company to convert this substantial amount of debt into equity
in the Company," said Gene Davis, Aquis' Chief Executive
Officer.  "We believe that Aquis' current plan will generate
sufficient cash flows that should allow the Company to take
advantage of early payback options as well as maintain its
current operations well into the future."

"There are significant opportunities within the one-way paging
market, and we have focused our efforts to support the key
industries that continue to count on the reliability of this
service for their communication needs," said David Laible,
Aquis' Vice President of Sale and Marketing.  "While other
carriers are abandoning one-way paging service, we at Aquis
understand how critical this service is to many organizations,
and we will continue to embrace these opportunities and support
them with a high quality, cost effective messaging devise."

Aquis Communications Group, Inc. currently offers one-way and
two-way interactive messaging as well as national, regional and
local messaging services to customers in the Northeast and Mid-
Atlantic areas.  The Company also offers cellular, long distance
and data services.  Headquartered in Parsippany, NJ, Aquis
Communications maintains offices in Freehold, NJ and Tyson's
Corner, VA.  Ladenburg Thalmann & Co. Inc. acted as financial
advisor to Aquis Communications during the restructuring.  For
more information on Aquis Communications visit:
http://www.aquiscommunications.com


AREMISSOFT CORP: N.J. Court Confirms Plan of Reorganization
-----------------------------------------------------------
AremisSoft Corporation announced that the Honorable Joel Pisano
of the United States District Court for the District of New
Jersey has completed the confirmation hearing for the company's
plan of reorganization under Chapter 11 of the United States
Bankruptcy Code.

Judge Pisano said in court that he found all the requirements
for confirmation fulfilled and invited counsel to submit formal
papers for his signature. Judge Pisano also announced his
intention to approve a settlement of the class action litigation
brought against AremisSoft on behalf of security holders. Formal
papers approving this settlement and the effective date of the
plan are expected in the coming weeks, which will result in
AremisSoft's wholly owned subsidiary, SoftBrands, Inc., becoming
an independent company.

Highlights of the plan include:

     --  All secured and unsecured claims approved by the Court
         will be paid in full;

     --  AremisSoft will contribute its litigation claims and
         certain other assets to a liquidating trust that will
         pursue those claims and liquidate the assets primarily
         for the benefit of securities class action plaintiffs;

     --  Holders of AremisSoft common stock as of June 28, 2002
         will receive 39.5 percent and securities class action
         plaintiffs will receive 60.5 percent, respectively, of
         the common stock of SoftBrands; and

     --  All existing equity interests in AremisSoft will be
         cancelled.

The distribution of SoftBrands' common stock will take place
after the effective date. Shareholders of record as of June 28,
2002 will receive notification of the distribution from the
disbursing agent and will be asked to provide their AremisSoft
stock certificates and to submit an affidavit regarding their
ownership to effect this change.

George Ellis, chairman and CEO of AremisSoft and SoftBrands, who
was brought in to lead the restructuring effort, stated, "We are
very pleased that the Court, the Plaintiffs and our shareholders
all supported this effort to preserve the underlying value of
the business. The confirmation of the plan settles the class-
action litigation against AremisSoft and represents the
culmination of months of hard work by a very dedicated team. We
at SoftBrands welcome this new beginning and look forward to
focusing full-time on our primary mission--building a world-
class software company."


ARMSTRONG: Trafalet Wins Nod to Hire PJ Solomon as Fin'l Advisor
----------------------------------------------------------------
Judge Newsome approved the retention of Peter J. Solomon Company
as the investment banker and financial advisor of Dean Trafalet,
Legal Representative for Future Claimants, in Armstrong
Holdings, Inc.'s chapter 11 cases, nunc pro tunc to February 20,
2002.

The terms of this engagement, as revised, are:

     (1) Term:  Initial term of six months from February 20,
         2002, but retention may continue after that on a
         month-to-month basis without further application
         or judicial approval;

     (2) Termination:  After the initial six-month period,
         either the Futures Representative or PJSC may terminate
         this retention on 30 days' prior written notice;

     (3) Compensation:  As compensation, PJSC will charge the
         Futures Representative a monthly fee of $155,000,
         [reduced by $20,000] commencing on February 20, 2002,
         for a period of two years, and a monthly fee of
         $145,000 [a flat fee replacing a tiered structure
         ranging from $150,000 to $100,000] for the duration of
         these Chapter 11 cases;

     (4) Indemnity:  PJSC and its affiliates or any employee,
         agent, officer, servant, director, attorney,
         shareholder or any person who controls PJSC are
         entitled to be indemnified from and against certain
         losses and liabilities arising from or related to
         PJSC's performance of its services on behalf of the
         Futures Representative.  The indemnity will not apply
         to any liability that has been "judicially determined
         to have resulted from the gross negligence, fraud, lack
         of good faith, bad faith, willful misfeasance or
         reckless disregard of the obligations or duties of
         PJSC."

PJSC's services include:

       (1) valuation of the Company as an on-going concern, in
           whole or part;

       (2) valuation analyses of the Company's asbestos
           exposure;

       (3) review of and consulting on the financing options for
           the Company including proposed DIP financing;

       (4) review of and consulting on the potential
           acquisition, divestiture, and merger transactions of
           the Company;

       (5) review of and consulting on the capital structure
           issues for the reorganized Company, including debt
           capacity;

       (6) review of and consulting on the financial issues and
           options concerning potential plans of reorganization,
           and coordinating negotiations in that connection;

       (7) review of and consulting on the Company's operating
           and business plans, including an analysis of the
           Company's long-term capital needs and changing
           competitive environment;

       (8) general advice and consultation regarding the
           adequacy of funding of any trust contemplated by the
           Bankruptcy Code;

       (9) testimony in court on behalf of the Futures
           Representative as needed; and

      (10) any other necessary services as the Futures
           Representative or the Representative's counsel may
           from time to time request with regard to financial,
           business or economic issues that may arise.
           (Armstrong Bankruptcy News, Issue No. 24; Bankruptcy
           Creditors' Service, Inc., 609/392-0900)

Armstrong Holdings Inc.'s 9.0% bonds due 2004 (ACK04USR1),
DebtTraders says, are quoted at 58.5. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=ACK04USR1for
real-time bond pricing.


BEYOND.COM: Selling GSG Assets & Contracts to Softchoice for $3M
----------------------------------------------------------------
Beyond.com Corporation agrees to sell to Softchoice Corporation
substantially all of the assets and customer contracts related
to Beyond's Government Systems Group.

Under the terms of the asset purchase agreement, Softchoice has
agreed to pay US$ 3.3 million in cash to Beyond, subject to
adjustments and escrows as provided in the agreement. The
purchase of assets is subject to certain closing conditions,
including bankruptcy court approval.

Softchoice is not assuming liabilities of Beyond.com other than
the obligations under the Beyond.com Government Systems Group
customer contracts. Beyond expects that the total sale proceeds
of this transaction, together with the proceeds of the
previously announced sale of its eStore assets to Digital River
which was completed in March 2002 and the proceeds of
liquidation of its remaining office and technology assets, will
be insufficient to cover all of Beyond's liabilities and that,
therefore, Beyond's stockholders will not receive any
distribution upon completion of the bankruptcy proceedings.

Beyond.com Corporation filed a voluntary petition under Chapter
11 of the United States Bankruptcy Code in order to effect the
sale of its two operating businesses, eStores Group and
Government Systems Group. Beyond's eStore Group was a leading
provider of e-commerce technology and services. Beyond's eStore
Group was sold on March 31, 2002, subject to pending court
approval. The Government Systems Group, now the subject of the
asset purchase agreement with Softchoice Corporation, which is
subject to court approval, sells software and computer-related
products to the Federal Government. For more information visit:
http://www.beyond.com


CJF HOLDINGS: Chapter 7 Trustee Signs-Up Mihlstin as Accountant
---------------------------------------------------------------
Michael B. Joseph, the Chapter 7 Trustee overseeing the
liquidation of CJF Holdings, Inc., sought and obtained approval
from the U.S. Bankruptcy Court for the District of Delaware to
employ and retain Steven W. Mihlstin, Certified Public
Accountant, as his accountant.  The Trustee asserts that
retaining Mihlstin as his accountant is necessary to assist and
enable him to perform his duties and administer the estate.

Pursuant to an Engagement Letter, Mihlstin will:

     i) determine the taxable income from the corporate records
        of which the Trustee will provide (i.e. general ledger,
        cash disbursement, cash receipts, sales & purchased
        journals) and will not audit or review these financial
        statements;

    ii) prepare/ review tax returns:

        -- corporate tax returns
        -- payroll tax returns (including 1099's and W-2's) if
           necessary;

Mihlstin will be paid for its services on an hourly basis:

          Accountants               $125 per hour
          Administrative Support    $45 per hour

CJF Holdings, Inc. filed for voluntary chapter 11 protection on
November 28, 2001 and received Court approval to convert its
case to a chapter 7 liquidation proceeding on February 8, 2002.
Donna L. Harris, Esq. at Morris, Nichols, Arsht & Tunnell
represents the Debtor.  When the company filed for protection
from its creditors, it listed an estimated assets and debts of
$10 million to $50 million.


CARIBBEAN PETROLEUM: Seeks 2nd Lease Decision Period Extension
--------------------------------------------------------------
Caribbean Petroleum LP and its debtor-affiliates ask for a
second extension of their lease decision period from the U.S.
Bankruptcy Court for the District of Delaware.  The Debtors want
the deadline by which they must determine whether to assume,
assume and assign, or reject their unexpired nonresidential real
property leases extended through August 14, 2002.

The Debtors indicate that their Unexpired Leases constitute
significant assets in their bankruptcy estates.  An extension of
the lease decision period is required in order to evaluate the
value of the leases, the Debtors assert.  Premature assumption
or rejection of the leases may complicate the Debtors'
reorganization efforts, and may lead to unnecessary
administrative claims relating to assumed leases if later
rejected.

Caribbean Petroleum L.P. distributes petroleum products and
owns/leases real property on which service stations selling
petroleum products are stored and sold to retail customers. The
Company filed for chapter 11 protection on December 17, 2001.
Michael Lastowski, Esq., and William Kevin Harrington, Esq., at
Duane, Morris & Heckscher LLP represent the Debtors in their
restructuring efforts.


CENTERPOINT FUNDING: Fitch Lowers Several Transactions' Ratings
---------------------------------------------------------------
Fitch Ratings has downgraded the following Centerpoint Funding
Company I, L.L.C. transactions.

      Centerpoint Funding Company I, L.L.C., series 1998-1

        --Class A notes downgraded to 'BBB-' from 'A';

        --Class M notes downgraded to 'C' from 'BB'.

      Centerpoint Funding Company I, L.L.C., series 1999-1

        --Class B notes downgraded to 'BBB-' from 'BBB';

        --Class C notes downgraded to 'B' from 'BB';

        --Class D notes downgraded to 'CC' from 'B'.

All remaining notes of both series are placed on Rating Watch
Negative.

The rating actions reflect adverse collateral performance and
the deterioration of asset quality. Losses from defaulted leases
have significantly reduced the remaining credit enhancement
available for all classes of notes in both transactions. The
rating actions also reflect Fitch's concerns regarding the
financial condition and servicing procedures of Centerpoint
Financial Services, LLC, the servicer of both transactions, and
Centerpoint's ability to continue as servicer and to
appropriately service the transactions.

Fitch will continue to closely monitor these transactions and
may take additional rating action in the event of further
deterioration.


COHO ENERGY: Citation Oil Pitches Best Bid for OK & TX Assets
-------------------------------------------------------------
Coho Energy, Inc. (OTCBB:CHOH) announced the results of the
auction held in the U.S. Bankruptcy Court in Dallas on June 27,
2002 for the sale of all of its oil and gas properties. Citation
Oil & Gas Corp. made the winning bid of $165.5 million for Coho
Energy's oil and gas properties located in Oklahoma and Red
River County, Texas. Denbury Resources, Inc. was the winning
bidder for Coho Energy's oil and gas properties located in
Mississippi and Navarro County, Texas with a bid price of $50.3
million.

A hearing is scheduled on July 22, 2002 in the U.S. Bankruptcy
Court in Dallas for final approval of these oil and gas property
sales. If a competing plan of reorganization is filed by a third
party with the court, the court will either approve the plan of
reorganization or the oil and gas property sales at this
hearing.

The property sales are scheduled to be completed in late August
2002, subject to completion of title and environmental reviews
and final approval by the court.

Since the estimated claims of Coho Energy's creditors in its
bankruptcy proceedings aggregate in excess of $335 million, it
is unlikely that Coho Energy's shareholders will receive any
distribution upon liquidation of the company. Coho Energy's
creditors will be paid pursuant to U.S. Bankruptcy Court
approval.


CORRPRO COMPANIES: Fails to Beat Form 10-K Filing Deadline
----------------------------------------------------------
Corrpro Companies, Inc. (Amex: CO), the leading provider of
corrosion protection engineering services, systems and
equipment, has filed a Notification of Late Filing with the
Securities and Exchange Commission relating to its Form 10-K for
the year ended March 31, 2002.  Corrpro's Form 10-K would
otherwise have been due on July 1, 2002.

"As previously announced, the preparation and audit of our
financial statements have been delayed by the voluntary
administration proceedings and ongoing investigation of
Corrpro's Australian subsidiary," stated Chairman, President and
CEO Joseph W. Rog.  "We have experienced further delays due to
the Australian investigation and need additional time to
complete our Annual Report on Form 10-K.  Therefore, we have
filed for a 15-day extension.  While we can provide no
assurances, we anticipate filing our Annual Report on Form 10-K
within the 15-day extension period."

Commenting on current fiscal year results, Mr. Rog continued:
"Revenues for April and May 2002 met our expectations and
operating income exceeded internal projections.  While the
anticipated lower revenues and unusual consulting costs are
impacting the bottom line, we have achieved a gross margin
improvement and reduced our operating expenses compared with the
prior-year period."

With the assistance of strategic financial advisors, the Company
has developed and is implementing plans for operational changes
and debt reduction, which form the basis for ongoing discussions
with its senior lenders concerning previously reported covenant
violations and other alternatives for financing the business on
an ongoing basis. There can be no assurance, however, that the
Company will be able to complete negotiations or amendments to
its existing loan agreements. If such loan agreements are not
effectively amended so as to be reflected in the Company's
fiscal 2002 financial statements, further adjustments, including
potentially material non-cash charges to write down the value of
certain assets, may be required.

Corrpro, headquartered in Medina, Ohio, with over 60 offices
worldwide, is the leading provider of corrosion control
engineering services, systems and equipment to the
infrastructure, environmental and energy markets around the
world.  Corrpro is the leading provider of cathodic protection
systems and engineering services, as well as the leading
supplier of corrosion protection services relating to coatings,
pipeline integrity and reinforced concrete structures.


COVANTA ENERGY: Panel Asks Court to Modify Cash Collateral Order
----------------------------------------------------------------
The Official Committee of Unsecured Creditors, in Covanta Energy
Corporation's chapter 11 cases, asks the Court to modify the
Final Cash Collateral Order to align its Carve-Out provision
with the Carve-Out provisions in the GECC Cash Collateral Order.

Michael J. Canning, Esq., at Arnold & Porter, in New York,
relates that the GECC Cash Collateral Order and the Interim Cash
Collateral Order have two key provisions:

    (1) until a notice of an Event of Default is issued by the
        secured lenders under the DIP Agreement, cash contained
        in the Debtors' Centralized Cash Management System can
        be used without limitation for the payment of the
        Debtors' and the Committee's professional fees and
        expenses; and

    (2) upon issuance of notice of an Event of Default under the
        DIP Agreement, further use of the cash collateral of the
        payment of fees and expenses of professionals on a going
        forward basis will be subject to a cap of $2,500,000.

However, Mr. Canning notes, the Final Cash Collateral Order
contained a new provision in the Carve-Out that limited the
total amount of cash collateral to $2,500,000 that the trustees
of the Debtors' waste-to-energy projects would be required to
make available under the Final Cash Collateral Order.

The Debtors have taken the position that the effect of this
provision is only to limit the use of the WTE Cash Collateral
from the time a notice of an Event of Default is issued under
the DIP Agreement.  It will have no adverse effect on the
ability of the professionals to operate during the Course of
these cases prior to delivery of the notice of a default.  Mr.
Canning believes that this would still change the Carve-out so
that the WTE Cash Collateral, upon notice of an Event of Default
would be limited to $2,500,000 on a going forward basis, instead
of $2,500,000 going forward and unpaid fees incurred up to that
time.

Mr. Canning contends the at the language of the Order was not
approved by the Committee nor was it reviewed by any parties
except the Debtors' counsel prior to its entry by the Court.

Accordingly, the Committee proposes to insert a provision
similar to the GECC Cash Collateral Order clarifying that the
cap of $2,500,000 obtained by the WTE Trustees under the Final
Cash Collateral Order will not apply to funds that enter the
Debtors' Centralized Cash Management System prior to the
issuance of a notice of an Event of Default under the DIP
Agreement.

The Committee believes that the revision is necessary and
appropriate to clarify the ambiguity of the language, which
could potentially cripple the operation of the Chapter 11
proceedings. Furthermore, the Committee believes that its
position is fully consistent with the understanding of the
parties, including the Court, at the hearing of the Final Cash
Collateral Order, and is consistent with the Carve-Outs provided
under the Interim Cash Collateral Order, the Interim DIP Orders
and the GECC Cash Collateral Order.

In addition, the Committee also proposes to add this sentence to
the Final Cash Collateral Order:

    "Notwithstanding the preceding sentence, nothing in this
     Final Order is intended to restrict the use by the Debtors
     of any funds in the Debtors' Centralized Cash Management
     System as provided in the Cash Management Motion, including
     without limitation any project-related cash collateral or
     the proceeds thereof in the Centralized Cash Management
     System, to pay professional fees and expenses, whether
     or not a Carve-Out Notice has been given." (Covanta
     Bankruptcy News, Issue No. 8; Bankruptcy Creditors'
     Service, Inc., 609/392-0900)


ENRON CORP: LNG Unit Selling Hoegh Charter Contracts for $21.5MM
----------------------------------------------------------------
Martin A. Sosland, Esq., at Weil, Gotshal & Manges LLP, in New
York, tells the Court that Enron LNG Shipping Company was formed
under the laws of the Cayman Islands on January 20, 2000 to
facilitate practices related to Enron Global LNG LLC's LNG
businesses.  Mr. Sosland relates that the LNG Businesses engage
in merchant trading activities and provide for the
transportation of liquefied natural gas on behalf of various
Enron-related LNG infrastructure investments.

Enron LNG is a wholly owned subsidiary of Enron Global LNG which
serves as a holding company and coordinator of Enron's global
businesses related to LNG activities.  In turn, Enron Global LNG
is wholly owned by Atlantic Commercial Finance, Inc., a Delaware
corporation that is not a debtor in any proceeding.  Enron owns
Atlantic Commercial.

Mr. Sosland reminds the Court that Enron LNG filed its voluntary
petition for relief under Chapter 11 of the Bankruptcy Code on
January 24, 2002.  Since then, it has been procedurally
consolidated for administrative purposes with the Chapter 11
cases of the other Enron Debtors.  At the same time, Mr. Sosland
says, Enron LNG also filed a petition with the Grand Court of
the Cayman Islands seeking appointment of joint provisional
liquidators and a stay of proceedings pursuant to the laws of
the Cayman Islands.  This request was immediately granted.
According to Mr. Sosland, the Joint Provisional Liquidators,
with full authority under Cayman Islands law, now oversee and
otherwise liaise with the existing board of directors of Enron
LNG in effecting the winding-up or realization of the business
or assets under the supervision of the Grand Court and the
Bankruptcy Court.

To facilitate its liquidation, Mr. Sosland relates, Enron LNG
entered into a Purchase and Sale Agreement with Tractebel LNG
Trading S.A., which is an affiliate of Tractebel S.A., the sixth
largest independent power producer in the world.  Tractebel S.A.
is also associated with Suez, a major European conglomerate.

Under the Purchase and Sale Agreement, Mr. Sosland explains,
Enron LNG will sell and assume and assign these contracts to
Tractebel:

    (a) the LNG Vessel Time Charter for the vessel known as the
        H"egh Galleon, as amended;

    (b) the Deed of Guarantee of Owner Guarantor;

    (c) the voyage expense payment agreement; and

    (d) all of the remaining bunker fuel, remaining on board the
        Vessel, and all LNG Heel, remaining in the tanks on
        board the Vessel, as of the Closing.

                     The Charter Contracts

Enron LNG entered into the Charter Contracts as part of a
charter party transaction for use of the 87,000-cubic meter
capacity Vessel.

Mr. Sosland relates that Enron LNG and Hoegh Galleon Gas Ltd.
entered into the Time Charter, which term ends on December 31,
2018.  Hoegh agreed to charter and service the Vessel to Enron
LNG for the primary purpose of carrying liquefied natural gas as
cargo.  Full compensation to Hoegh is paid monthly at a hiring
rate consisting, principally, of these financial, operating and
capitalized operating cost components:

1. The Financial Component provides for ownership costs and all
   remuneration due to Hoegh under the Time Charter to be paid,
   daily, to Hoegh from the date of delivery of the Vessel to
   Enron LNG until a date specified and subject to amendment by
   the Parties;

2. The Operating Component provides for costs related to the
   operation of the Vessel and for the annual adjustment of the
   costs to reflect changes in these. For the purposes of
   adjustment, Hoegh and Enron LNG will meet at least 60 days
   prior to January 1 of each subsequent calendar year after the
   delivery date of the Vessel for the purposes of establishing
   estimated operating costs with respect to that year;

3. Capitalized Operating Costs provide for the excess costs,
   which are distributed over the remaining terms of the Time
   Charter, excluding any extension period unless otherwise
   stated in Section 2.2 of the Time Charter.  Included in the
   Capital Operating Costs are any cost payable by Enron LNG,
   which is in excess of $100,000 as well as any new equipment
   and machinery agreed upon by H"egh and Enron LNG;

Mr. Sosland notes that Enron LNG and Hoegh amended the Time
Charter, primarily to address maintenance, costs and delivery
dates, on these dates: October, 20, 2000, February 8, 2001 and
March 12, 2001.

At the same time of the execution of the Time Charter, Leif
Hoegh & Co. Shipping AS, a Norwegian Corporation,
unconditionally and irrevocably issued to Enron the Owner
Guarantee, up to and not to exceed $20,000,000, to ensure that
Hoegh would duly perform and comply with all of its obligations
under the Time Charter when due.

Six months later, in October 2000, Enron LNG and Hoegh entered
into the Voyage Expense Payment Agreement, under which Enron LNG
appointed Leif Hoegh & Co. ASA as paying agent for the purpose
of making payments of certain expenses for which Enron LNG is
responsible.  The term of the Voyage Expense Payment Agreement
ends on October 20, 2005.  The Agreement includes, among other
things:

    (a) fuel costs (excluding boiloff gas),
    (b) port charges,
    (c) agency fees,
    (d) commissions,
    (e) expenses of loading and discharging cargoes,
    (f) canal dues, and
    (g) expenses of towing, pilotage, and docking.

Pursuant to the Voyage Expense Payment Agreement, Mr. Sosland
explains, Enron LNG will reimburse Hoegh upon demand for all
payments made by Hoegh in respect of the Voyage Expenses, or as
otherwise provided under the Voyage Expense Payment Agreement.

                Marketing of the Charter Contracts

According to Mr. Sosland, Enron Global LNG initiated and
conducted a structured auction process that was designed to
ultimately result in Bankruptcy Court-approved transactions
involving the sale and assignment of the various Enron-related
LNG assets, including Enron LNG's right, title and interest to
and under the Charter Contracts.

Initially, the interest of 37 potential bidders was solicited in
connection with the possible sale of its LNG-related assets,
including the Charter Contracts.  Of that list, 24 potential
bidders executed and returned confidentiality agreements, and
Enron Global LNG provided the bidders with a detailed and
confidential information memorandum describing, among other
things, the Charter Contracts and the procedure for
participating in the bidding process.  Non-binding indicative
"Round I" bids were due on March 1, 2002.  These bids were based
solely on information contained in the Information Memorandum
and Enron Global LNG's written responses to approximately 136
preliminary questions submitted by interested bidders.

The group of interested bidders narrowed down to 11.  "Round II"
required the submission of firm bids and firm comments to Enron
Global LNG's proposed form of purchase and sale agreement.  The
bids were due on May 2, 2002.

Bidders were invited to the data room maintained at Enron Global
LNG's offices in Houston, which contained all information
relating to the Charter Contracts.  Enron Global LNG also
arranged for interested Round II bidders to visit and conduct an
above-the-waterline inspection of the Vessel during routine
cargo discharge operations at Penuelas, Puerto Rico on March 22
and 23, 2002.  Six Round II bidders participated in this Vessel
inspection.  As a result of these efforts, Enron Global LNG
received seven Round II firm bids, including five for the
Charter Contracts.

After a review, Enron LNG chose Tractebel as the preferred
bidder for offering the "best price" for the Assets.  The
parties immediately commenced negotiation of the definitive
Purchase and Sale Agreement.

                  The Purchase and Sale Agreement

The principal terms and conditions of the Purchase and Sale
Agreement are:

Purchase Price:  $21,500,000

                Tractebel also agrees to pay Enron LNG, at
                Closing, an amount equal to the Bunker Fuel and
                LNG Heel Value.

Escrow
Arrangements:   Tractebel will deposit by wire transfer in
                immediately available funds an amount equal to
                $2,150,000 to be held in escrow with JPMorgan
                Chase Bank, Houston Office, as escrow agent,
                pursuant to an escrow agreement among Tractebel,
                Enron LNG and the Escrow Agent.

Closing
Date Payment:   At the Closing, Tractebel will pay Enron LNG
                by wire transfer an amount equal to:

                   (i) the Purchase Price less the Deposit
                       (together with any interest earned in
                       respect of the Deposit) deposited in
                       Escrow, plus

                  (ii) that amount which is equal to the Bunker
                       Fuel and LNG Heel Value, all in
                       immediately available funds to the
                       account or accounts specified by Enron
                       LNG to Tractebel on or prior to the
                       Business Day immediately preceding the
                       Closing.

Tractebel's
Parent Guaranty: Contemporaneously with the execution of the
                Purchase and Sale Agreement, Tractebel will
                deliver to Enron LNG its Parent Guaranty to
                guarantee the deposit by Tractebel of the Escrow
                with the Escrow Agent in accordance with Section
                3.2 and all payment obligations of Tractebel
                arising under the Purchase and Sale Agreement.
                Tractebel will cause its Parent Guaranty to be
                maintained in full force and effect until Enron
                LNG has received full and final payment of the
                Purchase Price and the Bunker Fuel and LNG Heel
                Value.

Closing
Statement:      Not later than three Business Days prior to the
                Closing Date, Enron LNG must prepare and deliver
                to Tractebel a statement of the estimated
                Closing Date Payment.  This statement will set
                forth, in reasonable detail, the calculation of
                the Closing Date Payment.

Assumption of
Liabilities:    Effective upon the Closing Date, Tractebel
                agrees to assume and to pay, perform and fully
                satisfy when due only those liabilities, duties
                and obligations of Enron LNG under or pursuant
                to the Assumed Contracts that are attributable
                to the period from and after the Closing Date.

Non-Recourse Sale,
Disclaimer of
Representations
and Warranties: Except as otherwise expressly set forth in the
                Purchase and Sale Agreement:

                   (i) the assignment, sale, transfer, setting
                       over and delivery of the Assets will be
                       "as is, where is" and "with all faults";
                       and

                  (ii) Tractebel will have no recourse to Enron
                       LNG or any Affiliate, from and after the
                       Closing in connection with the Assets,
                       the Assumed Contracts, the Assumed
                       Liabilities or the Purchase and Sale
                       Agreement.

Seller's
Closing
Conditions:     The obligation of Enron LNG to proceed with the
                closing is subject, at its option, to the
                satisfaction on or prior to the closing date of
                all of these conditions:

                (a) Representations, Warranties, and Covenants

                    The representations and warranties of
                    Tractebel will be taken as a whole, true
                    and correct in all material respects, in
                    each case as of the date of the Purchase and
                    Sale Agreement and on and as of the Closing
                    Date, and the covenants and agreements of
                    Tractebel to be performed on or before the
                    Closing Date must have been duly performed
                    in all material respects in accordance with
                    the Purchase and Sale Agreement.

                (b) No Action

                    On the Closing Date, no Action (excluding
                    any matter initiated by Enron LNG or any of
                    its Affiliates) will be pending or
                    threatened before any Governmental Authority
                    of competent jurisdiction, including:

                       (i) the United States of America and the
                           Cayman Islands,

                      (ii) any state, province, country,
                           municipality, or other governmental
                           subdivision within the United States
                           of America or the Cayman Islands, and

                     (iii) any court or any governmental
                           department, commission, board,
                           bureau, agency or other
                           instrumentality of the United States
                           of America or the Cayman Islands or
                           of any state, province, country,
                           municipality, or other governmental
                           subdivision,

                    seeking to enjoin or restrain the
                    consummation of the Closing or recover
                    damages from Enron LNG or any Affiliate of
                    Enron LNG resulting therefrom.

                (c) U.S. Bankruptcy Court Order

                    The Bankruptcy Court must have entered an
                    order authorizing and approving the terms
                    and conditions of the Purchase and Sale
                    Agreement, and the order cannot have
                    been reversed, stayed, enjoined, set aside,
                    annulled or suspended;

                (d) Cayman Islands Court Order

                    The Grand Court of the Cayman Islands must
                    have entered an order authorizing and
                    approving the terms and conditions of the
                    Purchase and Sale Agreement, and the order
                    Cannot have been reversed, stayed,
                    enjoined, set aside, annulled or suspended.

                (e) Existing Guarantee

                    Effective as of the Closing Date:

                       (i) the Deed of Guarantee, dated April
                           11, 2000, executed by Enron for the
                           benefit of Hoegh pursuant to the Time
                           Charter and any related liabilities
                           must have been unconditionally
                           released as to Enron, the release in
                           form and substance satisfactory to
                           Enron LNG, and

                      (ii) substitute arrangements, if required,
                           in relation to Tractebel, must be in
                           effect;

Buyer's Closing
Conditions:     The obligation of Tractebel to proceed with the
                Closing contemplated is subject, at the option
                of Tractebel, to the satisfaction on or prior to
                the Closing Date of all of these conditions:

                (a) Representations, Warranties, and Covenants

                    The representations and warranties of Enron
                    LNG must be, true and correct in all
                    material respects, in each case as of the
                    date of the Purchase and Sale Agreement and
                    on and as of the Closing Date, and the
                    covenants and agreements of Enron LNG to be
                    performed on or before the Closing Date
                    must have been duly performed in all
                    material respects in accordance with
                    Purchase and Sale Agreement.

                (b) No action

                    On the Closing Date, no Action (excluding
                    any matter initiated by Tractebel or
                    any of its Affiliates) can be pending or
                    threatened before any Governmental Authority
                    seeking to enjoin or restrain the
                    consummation of the Closing or recover
                    damages from the Buyer or any Affiliate of
                    Tractebel resulting therefrom.

                (c) U.S. Bankruptcy Court Order

                    The Bankruptcy Court must have entered the
                    U.S. Bankruptcy Court Order, and the order
                    cannot have not been reversed, stayed,
                    enjoined, set aside, annulled or suspended.

                (d) Cayman Islands Court Order

                    The Grand Court of the Cayman Islands must
                    have entered the Cayman Islands Court Order
                    and the order cannot have not been reversed,
                    stayed, enjoined, set aside, annulled or
                    suspended.

                (e) No Material Adverse Effect

                    No material adverse effect on the physical
                    condition of the Vessel which deprives
                    Tractebel of the use thereof in the manner
                    intended under the Time Charter for a
                    continuous period of 120 days as determined
                    by a recognized industry expert qualified to
                    make the determination and mutually
                    acceptable to the Parties, can have
                    occurred or be continuing; it being
                    expressly acknowledged that, any effect
                    resulting from:

                    (1) any change in economic, industry, or
                        market conditions,

                    (2) any change in Law or regulatory policy,
                        or

                    (3) the U.S. Bankruptcy Case or the Cayman
                        Islands Proceeding will not constitute
                        a Material Adverse Effect; and

                (f) the Vessel must have been delivered to
                    Tractebel on Dropping Outbound Pilot from an
                    LNG terminal located at U.S.
                    Atlantic/Caribbean/U.S. Gulf of Mexico range
                    no later than July 31, 2002;

Closing:        Provided that the conditions set forth in
                Article 6 of the Purchase and Sale Agreement are
                fulfilled or waived at or prior to Closing,
                each Party agrees to close and consummate the
                transactions contemplated in the Purchase and
                Sale Agreement on the Closing Date at 10:00
                a.m., Houston, Texas time, at the offices of
                Andrews & Kurth L.L.P. at 600 Travis Street,
                Houston, Texas, 77002 or at another time or
                place as Enron LNG and Tractebel may otherwise
                agree in writing.

Seller's Closing
Obligations:    At the Closing, Enron LNG must execute and
                deliver, or cause to be executed and delivered,
                to Tractebel:

                (a) a certificate, dated the Closing Date and
                    executed by an authorized officer of Enron
                    LNG on its behalf, as to the matters set
                    forth in Section 6.2(a) of the Purchase and
                    Sale Agreement;

                (b) the Assignment and Assumption Agreement duly
                    executed by Enron LNG;

                (c) the Closing Statement duly executed by Enron
                    LNG;

                (d) the Assumed Contracts, together with a
                    certificate, dated the Closing Date and
                    executed by an authorized officer of Enron
                    LNG on its behalf, listing each Assumed
                    Contract and certifying that each Assumed
                    Contract is a true, correct and complete
                    original counterpart thereof; and

                (e) the Notice to the Escrow Agent duly executed
                    by Enron LNG;

Buyer's Closing
Obligations:    At Closing, Tractebel must deliver, or cause to
                be delivered, to Enron LNG:

                (a) the Closing Date Payment in immediately
                    available funds to the bank account as
                    provided in Section 3.2 of the Purchase and
                    Sale Agreement, and Enron LNG will be
                    allowed to keep and retain the Deposit;

                (b) a certificate, dated the Closing Date and
                    executed by an authorized officer of
                    Tractebel on its behalf, as to the matters
                    set forth in Section 6.1(a) of the Purchase
                    and Sale Agreement;

                (c) the Closing Statement duly executed by
                    Tractebel;

                (d) a duly executed copy of the Assignment and
                    Assumption Agreement;

                (e) certificates of resolutions or other action,
                    incumbency certificates and other
                    certificates of officers of Tractebel as
                    Enron LNG may require to establish the
                    identities of and verify the authority and
                    capacity of the officers of Tractebel who
                    are taking (or have taken) any action in
                    connection with the Purchase and Sale
                    Agreement, including the execution and
                    delivery hereof; and

                (f) the Notice to the Escrow Agent duly executed
                    by Tractebel.

Mr. Sosland assures the Court that the terms and conditions of
the proposed Purchase and Sale Agreement were negotiated at
arm's length and in good faith.  "Tractebel does not hold any
material interest in any of the Enron Companies, and is not
otherwise affiliated with any of the Enron Companies or their
officers or directors," Mr. Sosland asserts.  Enron LNG also
believes in the fairness of:

    (a) the design and conduct of the auction,

    (b) the selection of Tractebel as the successful bidder, and

    (c) the final terms reflected in the Purchase and Sale
        Agreement.

By this Motion, Enron LNG asks the Court to authorize and
approve:

    (a) the terms and conditions of the Purchase and Sale
        Agreement, and

    (b) authorize the consummation of the sale, free and clear
        of liens, claims and encumbrances, and the assumption
        and sale of the Charter Contracts to Tractebel.

Because the sale is subject to the approval and final order of
the Cayman Islands Court, Enron LNG is also seeking approval and
authorization for the sale of the Assets in the Cayman Islands.
(Enron Bankruptcy News, Issue No. 35; Bankruptcy Creditors'
Service, Inc., 609/392-0900)

Enron Corp.'s 9.125% bonds due 2003 (ENRON2), DebtTraders
reports, are quoted at a price of 9. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=ENRON2for
real-time bond pricing.


ENRON CORP: LNG Unit Wants to Sell Excalibur Charter Contracts
--------------------------------------------------------------
Two years ago, Enron LNG Shipping Company entered into an LNG
Vessel Time Charter Party with Exmar Excalibur Shipping Company
Limited, as successor in interest to Solaia Shipping Inc.
pursuant to that certain Novation Agreement between Exmar, Exmar
Lux S.A. and Enron LNG.

Melanie Gray, Esq., at Weil, Gotshal & Manges LLP, in New York
explains that the Time Charter governs the long-term charter of
a vessel called the Excalibur, which will be used to transport
liquefied natural gas.

Ms. Gray tells the Court that Solaia Shipping had contracted
with Daewoo Shipbuilding and Marine Engineering Co. Ltd. for the
construction of Excalibur.  Though construction of the Excalibur
is complete, Ms. Gray says, the ship has yet to be delivered to
Enron LNG in November 2002.

The Time Charter is for a term of 25 years, with an option to
extend for an additional 10 years.  The Time Charter commits
Enron LNG, or any assignee to make payments to the ship's owner
after delivery until the expiration of the Time Charter.

According to Ms. Gray, Exmar's parent, Exmar Lux S.A. granted to
Enron LNG a Deed of Guarantee of Owner Guarantor, which
guaranteed Solaia's obligations under the Time Charter in event
of a default of Solaia.  This is one of the Assets to be sold
along with the Time Charter.

Pursuant to a Lease Agreement between Lloyd's (Nimrod Machinery
Finance Limited and Solaia, Ms. Gray relates that the
Shipbuilding Contract was novated in favor of Lloyds and the
Excalibur was leased back to Solaia on June 29, 2001.  Ms. Gray
notes that Exmar has agreed to indemnify Solaia for any amounts
payable by Solaia to Lloyd's under the Lease Agreement.  Once
again, Exmar Lux S.A. guaranteed Exmar's obligations.

At the same time, Ms. Gray says, Solaia and a group of banks and
institutional lenders entered into a Loan Agreement to finance
construction of the Excalibur.  Four weeks later, Solaia novated
the Time Charter to Exmar.  The Novation is also one of the
Assets to be sold.

In addition, Ms. Gray notes, a Quiet Enjoyment Letter made for
the benefit of Enron LNG is included in the Assets to be sold.

Ms. Gray informs Judge Gonzalez that the Time Charter requires
that Enron LNG maintain a limited parent guarantee from Enron
Corporation covering certain of its payment obligations under
the Time Charter up to $74,500,000.  Furthermore, should the
credit rating of Enron Corp., as established by Standard & Poors
or Moody's Investor Services, fall below investment grade status
for a period exceeding 15 consecutive days, Exmar could require
Enron LNG, upon written notice, to replace the Enron Corp.
guarantee with a $75,000,000 revolving letter of credit within
45 days.  Ms. Gray relates that Enron LNG's obligations under
the Guarantee Requirements were reaffirmed in favor of Exmar in
connection with the Novation.

In the event that the Letter of Credit is not provided within 90
days of receipt of written notice from Exmar, Ms. Gray says,
Exmar can elect to treat the Time Charter as having been
repudiated.  On December 4, 2001, Ms. Gray recounts that Exmar
demanded the posting of the Letter of Credit as a result of the
decline in Enron Corp.'s credit rating.  Enron LNG commenced its
Chapter 11 cases on January 24, 2002, less than 90 days from the
date of Exmar's request for the Letter of Credit.

According to Exmar, Enron LNG's failure to satisfy the Guarantee
Requirements by posting the Letter of Credit triggered cross-
defaults of the Lease Agreement and the Loan Agreement.

As a result of the commencement of Enron LNG's Chapter 11 case,
Ms. Gray reminds the Court that Exmar filed a motion requesting
the Court enter an order compelling Enron LNG to assume or
reject the Time Charter immediately.  "Exmar's request for
relief was predicated on the fear that Lloyd's, pursuant to the
Lease Agreement, can terminate the Lease Agreement as a result
of the continuing default, and that the Lenders may have a
present right to foreclose on the Excalibur as a result of Enron
LNG's failure to satisfy the Guarantee Requirements," Ms. Gray
explains.  But Enron LNG contends that Exmar has not alleged
sufficient cause to compel them to assume or reject the Time
Charter at this time.

Even before the filing of its voluntary petition, Enron LNG has
already attempted to sell its assets including the Excalibur
Time Charter. (Enron Bankruptcy News, Issue No. 35; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


EXIDE: Appoints Janice M. Jones as EVP, Global Human Resources
--------------------------------------------------------------
Exide Technologies (OTCBB:EXDTQ), the global leader in stored
electrical energy solutions, announced the appointment of Janice
M. Jones as Executive Vice President, Global Human Resources.
She reports directly to Craig H. Muhlhauser, Exide's Chairman
and Chief Executive Officer.

Prior to joining Exide, Ms. Jones served as Senior Vice
President, Human Resources at American Express, where she was
responsible for a variety of areas including Benefits, HR
Systems, HR Finance, Strategic Planning and Health Services.
Prior to joining American Express, Ms. Jones was Vice President
of Human Resources at a subsidiary of Viad Corp (formerly the
Dial Corporation.) Ms. Jones received her Bachelors degree from
California State University at Hayward, and continued graduate
studies at the University of California - Berkeley. She also
earned a JD from the University of Michigan.

"With more than twenty years of human resources and legal
experience, Janice brings a wealth of knowledge to Exide. She is
a results-oriented, dynamic leader who will be responsible for
implementing global best practices and systems that will enhance
our human resource processes around the world. I am very pleased
to welcome her to my leadership team," said Muhlhauser.
"Janice's appointment reinforces that Exide is committed to
building a solid foundation for future success through
attracting, recruiting and developing people. Our restructuring
effort is moving forward on schedule and we are making excellent
progress in achieving the operational improvements defined in
our business plan."

Ms. Jones commented, "With operations in 89 countries, managing
human resources on a worldwide basis can be a challenge. But I
am looking forward to that challenge, and I am eager to work
with Craig, his team, and Exide's human resource managers around
the world to develop and implement policies and practices that
will become a benchmark for our industry."

Exide Technologies is the world's largest industrial and
transportation battery producer and recycler, with operations in
89 countries. Industrial applications include network-power
batteries for telecommunications systems, fuel-cell load
leveling, electric utilities, railroads, photovoltaic (solar-
power related) and uninterruptible power supply (UPS) markets;
and motive-power batteries for a broad range of equipment uses,
including lift trucks, mining vehicles and commercial vehicles.
Transportation uses include automotive, heavy-duty truck,
agricultural, marine and other batteries, as well as new
technologies being developed for hybrid vehicles and new 42-volt
automotive applications. The Company supplies both aftermarket
and original-equipment transportation customers. Further
information about Exide Technologies, its financial results and
other information can be found at http://www.exide.com

Exide Technologies' 10% bonds due 2005 (EXIDE2) are trading at
15, DebtTraders says. For real-time bond pricing, see
http://www.debttraders.com/price.cfm?dt_sec_ticker=EXIDE2


FFC HOLDING: Wants Exclusive Period Maintained Until July 15
------------------------------------------------------------
FFC Holding, Inc. and its debtor-affiliates want the U.S.
Bankruptcy Court for the District of Delaware to maintain their
exclusive periods.  The Debtors want an extension of their
exclusive period within which only the Company can propose and
file a chapter 11 plan through July 15, 2002 and the company
wants its time to solicit acceptances of that plan extended
through September 12, 2002.

The Debtors remind the Court that they have filed a plan of
reorganization and accompanying disclosure statement and have,
since then, been engaged in an ongoing plan negotiations and
review of their business plan and alternative strategies with
their creditors.

The Debtors also assert that they have achieved a certain of
their strategic and business objectives, including the sale of
their non-debtor foreign affiliates, Valdunes Holding, SAS and
its subsidiaries. Currently, they are pursuing cost reduction in
retiree benefits and pension plan payment obligations to achieve
a sufficient de-leveraging of their balance sheet and sufficient
increase in profitability.

Freedom Forge Corporation, the operating company of the U.S.
Debtors manufactures and sells railway wheels, railway axles and
other forged metal products. The Company filed for Chapter 11
protection on July 13, 2001. Christopher James Lhulier, Esq. and
Laura Davis Jones, Esq. at Pachulski Stang Ziehl Young represent
the Debtors in their restructuring efforts.


FIRST VIRTUAL: Fails to Meet Nasdaq Minimum Listing Requirements
----------------------------------------------------------------
First Virtual Communications, Inc., or the Company, (Nasdaq:
FVCX), a premier provider of rich media Web conferencing and
collaboration solutions, announced that the Company received a
Nasdaq Staff determination on June 25, 2002 indicating that the
Company fails to comply with the minimum bid price requirement
for continued listing set forth in Marketplace Rule 4450(a)(5),
and that its securities are, therefore, subject to delisting
from The Nasdaq National Market. The Company has requested a
hearing before a 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. In that
event, the Company plans to apply to transfer to The Nasdaq
Small Cap Market.

First Virtual Communications is a world leader in providing Web
conferencing and collaboration solutions to enterprises,
telecommunications service providers and government agencies. By
enabling interactive voice, video, chat and data collaboration
over IP, ISDN and ATM networks, First Virtual Communications
provides cost-effective, integrated end-to-end solutions for
large-scale deployments to enterprise desktops. The Company's
flagship product, Click to Meet(TM), provides a complete
framework for delivering a new generation of video-enabled Web
collaboration applications that address the real-time
communications needs of companies worldwide. Click to Meet(TM)
can be integrated seamlessly into popular messaging and
collaboration environments such as MSN Messenger and Microsoft
Exchange/Outlook. First Virtual Communications serves its
customers through a worldwide network of resellers and partners.
Additional information about First Virtual Communications can be
found on the Web at http://www.fvc.com


FLAG TELECOM: Court Okays Blackstone Group as Financial Advisors
----------------------------------------------------------------
FLAG Telecom Holdings Limited and its debtor-affiliates obtained
Court approval to employ Blackstone Group L.P. as their
financial advisor, nunc pro tunc to April 12, 2002.

                       Scope of Services

Specifically, Blackstone will:

     (a) Assist in the evaluation of the Debtors' businesses and
         prospects;

     (b) Assist in the development of the Debtors' long-term
         business plan and related financial projections;

     (c) Assist in the development of financial data and
         presentations to the Debtors' Board of Directors,
         various creditors and other third parties;

     (d) Analyze the Debtors' financial liquidity and evaluate
         alternatives to improve such liquidity;

     (e) Analyze various restructuring scenarios and the
         potential impact of these scenarios on the value of the
         Debtors and the recoveries of those stakeholders
         impacted by a Restructuring;

     (f) Provide advice with regard to restructuring or
         refinancing the Debtors' Obligations;

     (g) Evaluate the Debtors' debt capacity and alternative
         capital structures;

     (h) Participate in negotiations among the Debtors and their
         creditors, suppliers, lessors and other interested
         parties regarding a Transaction or a Restructuring;

     (i) Value securities offered by the Debtors in connection
         with a Restructuring;

     (j) Advise the Debtors and negotiate with lenders with
         respect to potential waivers or amendments of various
         credit facilities;

     (k) Provide testimony in these Chapter 11 cases concerning
         any of the subjects encompassed by the other financial
         advisory services;

     (l) Assist the Debtors in reviewing marketing materials in
         conjunction with a possible Transaction;

     (m) Assist in arranging debtor-in-possession financing for
         the Debtors, as requested;

     (n) Assist the Debtors in reviewing the terms, conditions
         and impact of any proposed Transaction;

     (o) Assist the Debtors in capital raising from third-party
         investors, as requested;

     (p) Attend meetings with the Debtors and other parties to a
         Restructuring as reasonably requested by the Debtors;
         and

     (q) Provide such other advisory services as are customarily
         provided in connection with the analysis and
         negotiation of a Restructuring or a Transaction, as
         requested and mutually agreed.

At the request of the Debtors, Blackstone may provide additional
services deemed appropriate or necessary to the benefit of the
Debtors' estate.

                       Terms of Retention

The Debtors have agreed to pay Blackstone:

  (a) a $225,000 monthly advisory fee, commencing on June 23,
      2002;

  (b) a Transaction Fee, equal to 0.75%
      multiplied by the total face/accreted value of any
      Obligations (less the total amount of gross proceeds of a
      financing in which Blackstone is entitled to receive a
      Capital Raising Fee if the proceeds were used in
      connection with restructuring Obligations) of the Company
      that is restructured, refinanced, repaid, acquired,
      assumed, satisfied, modified or amended, payable in cash
      promptly upon consummation of a Restructuring or a
      Transaction. These will not be included in the calculation
      of total Obligations:

      (1) the Company's guarantee to Alcatel if Alcatel's trade
          claim related to the FLAG North Asian Loop project is
          already included (in whole or in part) in the
          calculation of total Obligations or is paid or is
          otherwise satisfied, released or discharged in full
          or, to the relevant extent, in released or discharged
          in full or, to the relevant extent, in part;

      (2) any pre-petition trade claims in the aggregate of a
          creditor incurred in the ordinary course of business
          in an amount less than $10,000,000 that is paid in
          full with cash; and

      (3) any guarantee obligations of any of the Company
          entities should not be included if the primary
          obligation (in whole or in part) is already included
          in the calculation of the total Obligations.

      In no event, however, will the Transaction Fee be less
      than $7,000,000 if the Transaction Fee results from a
      Transaction and the Transaction is in relation to a
      transaction or series of transactions for (i) all or
      substantially all of the Debtors and its material
      subsidiaries or (ii) all or substantially all of the
      assets of the Debtors and its material subsidiaries.
      Notwithstanding anything to the contrary above, the
      payment of the Transaction Fee will be subject to the
      following limitations: (i) once a Transaction Fee is paid
      by the Company with regard to any indebtedness of the
      Company, no subsequent Transaction Fee will be payable
      with regard to such indebtedness; and (ii) no Transaction
      Fee will be payable with regard to indebtedness of the
      Company which is restructured, refinanced, acquired,
      assumed, satisfied, modified or amended in proceedings for
      liquidation of the Company unless that liquidation follows
      the sale or merger of any material part of the businesses
      or assets of the Company.

  (c) a DIP financing fee of 0.5% of the total facility size of
      any DIP financing provided by third party institutions,
      other than Barclays Bank plc and Westdeutsche Landesbank
      Girozetrale, and arranged by Blackstone, payable on
      approval of the DIP facility by final order of this Court
      (or a relevant court in a foreign jurisdiction) no longer
      subject to appeal, rehearing, reconsideration or petition
      for certiorari;

  (d) a capital raising fee of 4.0% of the gross cash proceeds
      received by the Company in connection with any transaction
      or series of transactions (excluding Transactions as
      defined in [b] above) whereby, directly or indirectly a
      third party or third parties provide financing for
      (including debt or equity capital, but exclusive of the
      DIP financing described in [c] above) the Debtors and/or
      their subsidiaries or affiliates, or any of their
      businesses or assets or any joint venture, incubator,
      operating company, collective investment or similar
      vehicle in which the Debtors or any of their subsidiaries
      or affiliates is a general partner, sponsor, investment
      manager or otherwise a material participant.  This is
      including, without limitation, through a sale or exchange
      of capital stock, options or assets, a merger,
      consolidation, re-capitalization or reorganization, the
      formation of a minority investment or partnership, or any
      similar transaction; and

  (e) reimbursement of all necessary and reasonable out-of-
      pocket expenses incurred during this engagement,
      including, but not limited to, travel and lodging, direct
      identifiable data processing and communication charges,
      courier services, working meals, reasonable fees and
      expenses of Blackstone's counsel and other necessary
      expenditures, payable upon rendition of invoices setting
      forth in reasonable detail the nature and amount of such
      expenses.  This is provided, however, that in the absence
      of the Debtors' prior written consent, which must not be
      unreasonably withheld, the Debtors will not be required
      to reimburse Blackstone for (i) the fees and expenses of
      its counsel in excess of $25,000 in the aggregate or (ii)
      any out-of-pocket expenses incurred by Blackstone in
      performing its engagement hereunder, including those of
      its counsel, in excess of $75,000 per calendar month.  In
      connection with this the Debtors will maintain a $50,000
      expense advance for which Blackstone will account upon
      termination of the engagement. (Flag Telecom Bankruptcy
      News, Issue No. 10; Bankruptcy Creditors' Service, Inc.,
      609/392-0900)


FLAG TELECOM: Files Disclosure Statement & Reorg. Plan in NY
------------------------------------------------------------
FLAG Telecom Holdings Limited (OTC:FTHLQ, LSE:FTL), together
with its subsidiaries that have filed in U.S. Bankruptcy Court
under Chapter 11, has filed a Plan of Reorganization and related
Disclosure Statement in the U.S. Bankruptcy Court for the
Southern District of New York. FLAG Telecom believes that it has
achieved an agreement in principle among its principal creditors
to support the main economic provisions of the Plan.

The Company believes that it can emerge from Chapter 11 and
related proceedings by September 2002 with its global network
intact, with a major reduction of its financial indebtedness and
a reduced operating expense level that will still enable FLAG
Telecom to service its customers. This timing assumes that the
requisite procedural steps can be accomplished on the schedule
anticipated by FLAG Telecom, and that the Plan receives the
requisite support from creditor groups and is confirmed by the
Court, and that the Schemes of Arrangement in the parallel
proceedings in Bermuda can be concluded on a similar time
schedule.

The reorganized holding company would have new shareholders as
summarized below, whereas current equity holders of FLAG Telecom
Holdings Limited would receive no consideration under the Plan.

Highlights of the filed Plan of Reorganization are as follows:

     1.  Holders of FLAG Telecom Holdings' 11-5/8% Senior Notes
would receive $245 million in cash, a $45 million promissory
note (callable at $30 million for 18 months) and 5% of the
common stock of Reorganized FLAG Holdings.

     2.  Holders of FLAG Limited's 8-1/4% Notes would receive
approximately 63% of the common stock of Reorganized FLAG
Holdings.

     3.  Bank lenders under a credit facility previously
extended to FLAG Atlantic Limited would receive approximately
26% of the common stock of Reorganized FLAG Holdings.

     4.  Certain significant trade creditors, such as Alcatel,
Reach and Ciena, would have their agreements with FLAG amended
and assumed and would receive other consideration which would
include notes and common stock of Reorganized FLAG Holdings and
cash, as detailed in the Plan.

     5.  Trade creditors of FLAG Telecom's entities other than
FLAG Atlantic Holdings and its debtor subsidiaries would receive
such treatment agreed to with FLAG, or reinstatement of their
claims or payment in full.

     6.  Trade creditors (other than Alcatel) of FLAG Atlantic
Holdings and those of its subsidiaries which are debtors in the
proceedings would receive only their pro rata rights to
preference actions.

Stefan Feuerabendt, Managing Director of the The Blackstone
Group, financial advisor to FLAG Telecom, observed, "FLAG
Telecom has worked diligently in intensive and complicated
negotiations with representatives of all of its major creditor
groups to present this Plan to the Court today. Upon
confirmation of this Plan, FLAG Telecom will have very
significantly reduced its financial obligations. When combined
with the Company's constructive operating plan, the deleveraging
of FLAG Telecom's balance sheet will leave the Company with a
materially improved financial position."

The FLAG Telecom Group is a leading global network services
provider and independent carriers' carrier providing an
innovative range of products and services to the international
carrier community, ASPs and ISPs across an international network
platform designed to support the next generation of IP over
optical data networks. On April 12 and April 23, 2002, FLAG
Telecom Holdings Limited and certain of its subsidiaries filed
voluntary petitions for reorganization under Chapter 11 of the
United States Bankruptcy Code in the United States Bankruptcy
Court for the Southern District of New York. Also, FLAG Telecom
Holdings Limited and the other companies continue to operate
their businesses as Debtors In Possession under Chapter 11
protection. FLAG Telecom Holdings Limited and certain of its
Bermuda-registered subsidiaries - FLAG Limited, FLAG Atlantic
Limited and FLAG Asia Limited - filed parallel proceedings in
Bermuda to seek the appointment of provisional liquidators to
obtain a moratorium to preserve the companies from creditor
actions. Provisional liquidators were appointed and part of
their role is to oversee and liaise with the directors of the
companies in effecting a reorganization under Chapter 11. Recent
news releases and further information are on FLAG Telecom's Web
site at: http://www.flagtelecom.com


FUELNATION: Convertible Noteholder Files Suit after Default
-----------------------------------------------------------
The Rosen Law Firm -- http://www.rosenlegal.com-- has filed a
lawsuit on behalf of a purchaser of a convertible promissory
note of FuelNation, Inc. (OTC BB:FLNT.OB).

The lawsuit alleges that FuelNation failed to pay interest on
the note when due. The noteholder subsequently declared
FuelNation in default on the note and has demanded full payment
of the principal and interest owed thereon. The complaint titled
Gianoukas v. FuelNation, Inc. was filed on June 21, 2002 in the
Superior Court of New Jersey, County of Hudson.


GLOBAL CROSSING: Goldin Seeks Stay Relief to Prosecute Claims
-------------------------------------------------------------
Goldin Associates LLC, asks the Court to grant relief from the
automatic stay so that it may pursue the affirmative claims
against Global Crossing.  Goldin Associates LLC submits this
Motion in its capacity as the Liquidating Trustee for the
Worldwide Direct Liquidation Trust created in accordance with
the Second Amended Consolidated Liquidating Chapter 11 Plan for
SmarTalk TeleServices, Inc., and Affiliates, proposed by the
Debtors and the Official Committee Of Unsecured Creditors.

Paul R. DeFilippo, Esq., at Wollmuth Maher & Deutsch LLP in
Newark, New Jersey, relates that on January 19, 1999, Worldwide
Direct, Inc., SmarTalk TeleServices, Inc. and SmarTalk's 18
direct and indirect subsidiaries, filed separate and voluntary
petitions seeking relief under Chapter 11 of the Bankruptcy
Code. These cases were commenced immediately upon the execution
on the Worldwide Petition Date of an asset purchase agreement
with AT&T for the sale of substantially all of the Worldwide
Debtors' assets.  Approximately 1,300 proofs of claims and
interests were filed in connection with the Delaware Proceeding.
Included in those proofs of claims are claim number 630 in the
amount of $24,253,530, and claim number 631 in the amount of
$14,347, both filed on behalf of Frontier Communications of the
West, Inc. and Frontier Communications International, now known
as or otherwise controlled by the Global Crossing.

According to Mr. DeFilippo, prior to the confirmation of the
Plan, on or about January 16, 2001, Global Crossing entered into
a "Stipulation, Order and Tolling Agreement Regarding Claims and
Causes of Action Against Frontier Corporation and Affiliates."
The Stipulation provides, among other things, for a suspension
of the applicable statute of limitations regarding the
commencement of any Action, for a period that is 60 days after
the Termination Date.  On that date, whatever time then
remaining under any applicable statute of limitations should
begin again to elapse. Notice of the Termination Date was
delivered effective March 11, 2002.

On March 15, 2002, Mr. DeFilippo accords that the Liquidating
Trustee filed with the Delaware Bankruptcy Court an "Objection
and Affirmative Defenses to the Proofs of Claim Numbers 630 and
631 Filed by Frontier Communications of the West, Inc. and
Frontier Communications International, Inc."  The Claims
Objection set forth several grounds supporting the Liquidating
Trustee's objection to the Proofs of Claim, including the fact
that the:

A. Proofs of Claims must be disallowed because the Debtors
   received preference payments totaling $3,803,462 in violation
   of Section 547 of the Bankruptcy Code;

B. The Debtors received postpetition overpayments in the amount
   of $577,639 and

C. The Debtors were liable in the amount of $4,209,832 for
   indemnification claims arising under a certain asset purchase
   agreement.

The Liquidating Trustee asks for relief from the automatic stay
to assert the Affirmative Claims, and if necessary, bring suit
on the Preference Claim in the Delaware Bankruptcy Court, as
part of the Claims Objection.  The Liquidating Trustee will
agree that it will not seek to execute on any judgment it may
recover on the Preference Claim, without further order of this
Court, but rather will raise any judgment as part of the Claims
Objection.

As an initial matter, notwithstanding the time constraints
imposed by the Stipulation, the relief requested in this Motion
is not time barred because of the protection afforded Global
Crossing pursuant to the automatic stay provision of Section 362
of the Bankruptcy Code which became effective on January 28,
2002.  Rather, Mr. DeFilippo says that the time by which the
Liquidating Trustee must commence the proposed litigation to
recover on the Affirmative Claims is controlled by Section
108(c)(2) of the Bankruptcy Code.  This Section provides that if
an agreement fixes a period for commencing or continuing a civil
action in a court other than a bankruptcy court on a claim
against a debtor, and that period has not expired before the
date of the filing of the petition, then that period does not
expire until the later of 30 days after notice of the
termination or the expiration of the stay under Sections 362,
722, 1201, or 1301 of this title with respect to that claim.
Therefore, the Liquidating Trustee has until 30 days after this
Court grants the relief requested herein to commence an action
seeking to recover on the Affirmative Claims.

In addition, Mr. DeFilippo claims that the Liquidating Trustee
has granted the Debtors' counsel several extensions of time to
file a reply to the Claims Objection.  The current deadline by
which Global Crossing must file and serve a response to the
Claims Objection is May 31, 2002.  As of the date of this
Motion, the Liquidating Trustee has not yet received a response
from Global Crossing.  The Debtors has suggested that it will
argue that the Claims Objection may not incorporate the
Preference Claim until there has been a determination of the
Debtors' liability for the Preference Claim.

Beginning December 7, 1998 through the Worldwide Petition Date,
in accordance with a series of letter agreements dated December
7, 1998, December 22, 1998, January 8, 1999 and January 15,
1999, Mr. DeFelippo contends that the Worldwide Debtors made
daily payments to the Global Crossing in the total amount of
$8,506,000.  The letter agreements provide that these payments
were to serve as:

A. prepayments for services rendered by Debtors from December 7,
   1998 and continuing forward in connection with Account
   Numbers 0202876973 and 0202866668, plus

B. a $480,000 security deposit to serve as additional security
   for services rendered by Global Crossing with respect to
   those accounts during that time.

Notwithstanding the foregoing, the Debtors' invoices indicate
that during the period from December 7, 1998 through the
Worldwide Petition Date, Debtors provided $6,098,544 worth of
services with respect to Account Numbers 0202876973 and
0202866668.  Accordingly, Mr. DeFilippo asserts that the
Worldwide Debtors overpaid Global Crossing in the amount of
$2,407,4565.  The letter agreements permit Global Crossing to
apply any overpayments to the unpaid prepetition balance due
from the Worldwide Debtors.  Those payments constitute payment
on account of an antecedent debt.  They are further avoidable as
preferential transfers pursuant to Section 547 of the Bankruptcy
Code.  In addition to the transfers noted above, the Worldwide
Debtors' records indicate that Global Crossing received
additional payments on account of antecedent debts in the amount
of $1,396,006.

In addition, Mr. DeFilippo believes that the Worldwide Debtors
made overpayments to Global Crossing. Beginning on January 22,
1999 and continuing through March 31, 1999, the Worldwide
Debtors made daily payments to Global Crossing in the total
amount of $10,093,000 pursuant to a stipulation dated February
4, 1999. The February Stipulation provides that those payments
constitute pre-payments for services to be rendered by Global
Crossing for account numbers 0202876973 and 0202866668 from the
Worldwide Petition Date.  The Worldwide Debtors' records
indicate that, during this postpetition period, Global Crossing
provided $9,515,361 worth of services with respect to account
numbers 0202876973 and 0202866668.  Thus, the Worldwide Debtors
overpaid Global by $577,639 for those post-petition services.
Despite the fact that the February Stipulation required the
overpayments to "be promptly returned to the [Worldwide]
Debtors," Global Crossing has failed to do so.  Accordingly,
Global Crossing's refusal to return the overpayments, has
resulted in an adjust enrichment in favor of Global Crossing.

Mr. DeFilippo adds that SmarTalk TeleServices, Inc. and SMTK NY-
1 Corp. and Global Crossing are parties to an Asset Purchase
Agreement dated as of October 22, 1997, by which the Worldwide
Debtors acquired certain prepaid phone card assets from Global
Crossing.  On December 9, 1998, the Worldwide Debtors delivered
to Global Crossing a notice of claims for indemnification under
said Asset Purchase Agreement.  That notice detailed $4,209,832
in claims, in addition to other unliquidated claims, relating
primarily to Global Crossing's breach of representations and
warranties regarding accounts receivable and other matters.
Accordingly, the Liquidating Trustee is entitled to pursue these
claims against Global Crossing on behalf of the Worldwide
Debtors.  In sum, Global Crossing is liable to the Worldwide
Debtors in the total sum of $8,590,933 as set forth above.
(Global Crossing Bankruptcy News, Issue No. 13; Bankruptcy
Creditors' Service, Inc., 609/392-0900)

Global Crossing Holdings Ltd.'s 9.625% bonds due 2008 (GBLX3)
are quoted at a price of 1.25, DebtTraders reports. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=GBLX3for
real-time bond pricing.


HMG WORLDWIDE: Wants Plan Exclusivity Stretched Until Aug. 19
-------------------------------------------------------------
HMG Worldwide Corporation and its debtor-affiliates want the
U.S. Bankruptcy Court for the Southern District of New York to
extend the exclusive periods during which only the Debtors may
file a chapter 11 plan and solicit acceptances of that plan.
The Debtors tell the Court that they need until August 19, 2002
to file a plan and until October 18, 2002 to solicit creditors'
acceptances.

The Debtors assure the Court that Counsel for the Committee has
been consulted on this matter and the Committee has indicated
its support for the Debtors request for an extension of the
Exclusive Periods.

The Debtors relate that they have been selling their assets,
have made diligent efforts to remedy problems that are holding
up closing the Bon-Art sale, and have closed on the sale of HMG
Griffith.

Additionally, the Debtors have liquidated their claims against
Kmart, settled potential claims with Aai.Foster Grant, rejected
leases and lifted the automatic stay to allow equipment lessors
to regain possession of their equipment, and are in the process
of marketing their remaining Reading, Pennsylvania property.

Presently, HMG Worldwide Corporation and its debtor-affiliates
are in the process of exiting the manufacturing portions of
their businesses and reorganizing as marketing, sales and design
companies, with third parties to do all required manufacturing.
The Company filed for chapter 11 protection on October 23, 2001.
Ira L. Herman, Esq. at Robinson Silverman et al., represents the
Debtors in their restructuring effort. When the Company filed
for protection from its creditors, it listed total assets of
$34,542,000 and total debts of $61,946,000.


IT GROUP: Shaw Registers Estates' 1.7 Million Shares
----------------------------------------------------
Gary P. Graphia, Secretary and General counsel of the Shaw
Group, Inc., delivered a copy of a Registration Rights Agreement
dated as of May 3, 2002, between The Shaw Group Inc. and The IT
Group, Inc. to the Securities and Exchange Commission to permit
registration of the Shaw shares The IT Group, Inc., and its
debtor-affiliates received pursuant to the Asset Purchase
Agreement, dated as of January 23, 2002.

"We entered into a registration rights agreement with IT Group
providing for certain registration and other obligations on our
part with respect to our common stock issued to IT Group as part
of the purchase price," Shaw tells the SEC.  "We issued these
shares in connection with our acquisition of substantially all
of the assets of The IT Group in May 2002.  We will not receive
any of the proceeds from the sale of shares by the selling
shareholder."

The purchase price for the acquisition was approximately
$52,500,000 in cash and 1,671,336 shares of Shaw's common stock
(the value of this stock was approximately $52,500,000 million
at closing). In addition, Shaw previously provided IT Group with
debtor-in-possession financing, which at the closing, was
approximately $50,000,000.

The Securities to be registered are:

       Securities:                  Common Stock, non par
                                    value per share
       Amount to be registered:     1,671,336 shares
       Maximum offering per share:  $30.48
       Aggregate offering:          $50,942

Shaw's expenses in connection with the issuance and distribution
of the shares of common stock:

        Registration fee                     $  4,687
        Fees & expenses of accountants         75,000
        Fees & expenses of legal counsel       75,000
        Printing & engraving expenses         100,000
        Miscellaneous                          15,313
                                             --------
        Total                                 270,000

The shares of Shaw common stock trade on the New York Stock
Exchange under the symbol "SGR."  On June 5, 2002, the last sale
price of the shares as reported on the New York Stock Exchange
was $31.28 per share.

A full-text copy of the Registration Rights Agreement is
available at no charge at:


http://www.sec.gov/Archives/edgar/data/914024/000095012902002968/0000950129-
02-002968.txt

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


ITC LEARNING: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: ITC Learning Corporation
        7600 Leesburg Pike, West Building
        Suite 450
        Falls Church, Virginia 22043

Bankruptcy Case No.: 02-83249

Type of Business: The Debtor is a provider of technical skills
                  training, via videotape, CD-Rom and intranet
                  delivery mediums, for the industrial
                  (processed and manufacturing) markets.

Chapter 11 Petition Date: July 1, 2002

Court: Eastern District of Virginia (Alexandria)

Judge: Stephen S. Mitchell

Debtor's Counsel: Stanley M. Salus, Esq.
                  Wickwire Gavin, P.C.
                  8100 Boone Blvd., #700
                  Vienna, Virginia 22182
                  703-790-8750
                  Fax : 703-448-1767

Total Assets: $2,600,000

Total Debts: $6,200,000

Debtor's 20 Largest Unsecured Creditors:

Entity                     Nature of Claim        Claim Amount
------                     ---------------        ------------
Internal Revenue Service   Taxes                      $180,350

County of Fairfax - Dept.  Taxes                       $91,748
of Tax

Lockheed Martin Systems    Integration Services        $84,065
Integration

Clarity Credit Corp.       Phone Lease Obligation      $68,893

Kirkpatrick & Lockhart LLP Legal Services              $58,763

Wisconsin Dept. of Revenue Taxes                       $57,398

Dyncorp                    Product Royalties           $42,954

Fulton County Tax          Taxes                       $47,004
Commissioner

InteliTarget Inc.          Telemarketing Services      $33,650

MCI Worldcom               Phone Service               $33,354

Grant Thornton LLP         Accountant                  $33,042

Power Team, Inc.           Programming Services        $32,638

SouthTrust Bank -          Car Lease Obligation        $31,766
Consumer Leasing Dep't.

Videologies, Inc.          Programming Services        $31,674

County of Fairfax - BPOL,  Taxes                       $31,748
Dept. of Tax

JM Field Marketing, Inc.   Product Fulfillment         $31,569

Interactive Training                                   $31,321
Solutions

MATRIX-T-1-Staples         Phone Lease Obligation      $28,505

Mintz, Levin, Cohn, Ferris Legal Services              $28,875

NIIT                       Product Licensing Agreement $24,327


INACOM CORP: Taps Werb & Sullivan as Special Delaware Counsel
-------------------------------------------------------------
Inacom Corp. and its debtor-affiliates sought and obtained
approval from the U.S. Bankruptcy Court for the District of
Delaware to engage Werb & Sullivan as Special Counsel, nunc pro
tunc to May 29, 2002.  Werb & Sullivan, as local Delaware
counsel, will work with Hahn Loeser & Parks, LLP to prosecute
the Debtors' possible avoidance actions under Chapter 5 of the
Bankruptcy Code.

The Debtors believe that Werb is uniquely qualified as their
local counsel because of the firm's knowledge of bankruptcy
practice and their familiarity with the Delaware courts.

Inacom will pay Werb & Sullivan for legal services at its
customary hourly rates:

   Professional             Position              Hourly Rate
   ------------             --------              -----------
   Duane W. Werb            Partner                  $395
   Joseph V. Bongiorno      Senior Law Clerk         $135
   Jennifer H. Unhoch       Law Clerk                $110
   Jonathon B. O'Neill      Law Clerk                $110
   Janet R. Corbett         Paralegal                 $95

Inacom is a single-source provider of information technology
services and products designed to enhance the productivity of
information systems primarily for Fortune 1000 clients. The
Company offers a comprehensive range of services to manage the
entire technology life cycle including: technology planning;
technology procurement; technology integration; technology
support; and technology management. InaCom sells its services
and products through a marketing network of approximately 90
business centers owned by the Company throughout the United
States that focus on serving large corporations. The Company has
international locations in Central America, South America, and
Mexico and international affiliations in Europe, Asia, the
Caribbean, Middle East, Africa, and Canada. The company filed
for Chapter 11 protection on June 16, 2000. Laura Davis Jones,
Esq., and Christopher James Lhulier, Esq., at Pachulski Stang
Ziehl Young & Jones PC represent the Debtors in their
restructuring efforts.


INT'L THUNDERBIRD: Defaults on $2.88MM Loans with MRG Entities
--------------------------------------------------------------
International Thunderbird Gaming Corporation (TSX:INB) is
pleased to announce that Salomon Guggenheim of Zurich,
Switzerland and Jean Duval of Carignan, Quebec have been
appointed to the board of directors of the Corporation,
effective June 28, 2002. These appointments fill vacancies on
the board left by Dave Michelson, the Chief Financial Officer
and Secretary of the Company, who advised the Company that he
would not stand for re-election as a director at the Annual
Meeting of the Company held on June 20, 2002, and by Clay
Hardin, who resigned as a director to create a vacancy to permit
these appointments. Both Mr. Michelson and Mr. Hardin continue
as officers of the Company.

As a result of these changes, the board now consists of five
directors who are Jack R. Mitchell and Albert W. Atallah, both
officers of the Company, Jorge Montano of Mexico City and
Messrs. Guggenheim and Duval, the latter three being outside
directors with diverse business backgrounds.

The new board has confirmed the reappointments of Mr. Mitchell
as President and Chief Executive Office, Mr. Atallah as Chief
Operating Officer and General Counsel, Mr. Hardin as Vice
President Operations and Dave Michelson as Chief Financial
Officer and Secretary.

The management of the Company believes that these appointments
resolve the proxy fight threatened by certain dissident
shareholders. In this threatened action, Alex Winch, the former
Chairman of the Board of the Corporation, notified Mr. Mitchell
and Mr. Atallah that he was leading a group of dissident
shareholders who were requesting the resignation of all of the
directors of the Corporation in favor of their appointees to the
board failing which they intended to solicit proxies from all
shareholders to appoint their slate of nominees to the board to
replace the existing directors. They further advised that if the
existing board would not agree to their request and they were
subsequently successful in electing their nominees to the board,
they would terminate the employment of all of the officers
without severance and relocate the head office of the Company to
Toronto.  Mr. Winch represented to Mr. Mitchell and Mr. Atallah
that he had the support of shareholders holding a sufficient
number of shares of the Company to carry out his objectives.
After making these demands and contacting a number of the
Company's business partners and lenders, the dissidents
concluded that they would not be in a position to carry on
successfully the various Company's business relationships
without the existing management, and Mr. Winch withdrew his
demands. This led to subsequent discussions between the existing
management and Mr. Guggenheim, who Mr. Winch had requested be
part of his dissident group, and he agreed to join the board.
Mr. Duval, a long time shareholder of the Company, was
recommended to the Company by other sources. The management
expects a good working relationship with both of the new
directors.

The disruption in management caused by the dissident group has
led the Company's primary lender and development partner, MRG
Entertainment LLC, to serve notices of default in respect of
loans totaling $2,880,000 made by MRG and its affiliates to the
Company. The Notices claim a default on the basis of a "change
of control" in management and in the composition of the board of
directors. The loan documents provide the Company with a 30 day
period to cure defaults, and the reconstitution of the board and
reappointments of the officers of the Company referred to above
rectify the circumstances on which default was claimed within
the 30 day cure period.

The Company will not proceed with the proposed merger of its
Nicaraguan operations with the Nicaraguan operations of Hopewell
Limited. The disruption of management by the dissident group
occurred during the Company's due diligence investigations of
the Hopewell transaction and adversely affected the Company's
relationship with MRG, to whom the Company had applied for its
financing in respect of the transaction. Although these factors
impacted the transaction negatively, the management of the
Company had become concerned during the due diligence process as
to the compatibility of the managements of the two companies,
leading to a mutual decision by the Company and Hopewell that it
was in neither company's best interest to proceed with the
merger.

In a matter unrelated to the recent management issues, the
Company has entered into a settlement with the Hopland Band of
Pomo Indians relating to claims made by the Company in respect
of the termination of the Company's revenue sharing arrangement
with the Band's gaming facility operated by the Band in
California which occurred in 1998. Under the terms of the
settlement, the Band will pay the Company a total of $750,000,
either in one lump sum if and when the Band successfully
completes a certain financing but in any event, over a 15 month
period at the rate of $50,000 per month without interest or over
a period of 36 months with interest at 12%. In either case, the
payments will commence on August 1, 2002 and the Band will
advise the Company whether it is electing the 15-month period or
the 36-month period prior to that time.

As a result of the disruptions to management which occurred due
to the threat of the dissident proxy fight, the Toronto Stock
Exchange halted trading in the common shares of the Company on
June 10, 2002 pending clarification of the Company's affairs.
The TSX has advised the Company that it is reviewing the
eligibility for continued listing of the common shares of the
Company on the TSX.

International Thunderbird Gaming Corporation is an owner and
manager of international gaming facilities. The Company's shares
trade on the Toronto Stock Exchange under the symbol INB.


INTERSTATE GENERAL: Cures Default on $4.4MM Promissory Note
-----------------------------------------------------------
Interstate General Company L.P. (Amex: IGC; PCX) has cured the
default previously announced relating to a promissory note in
the principal amount of $4,400,000.

The Company also announced that the Virgin Islands' Public
Service Commission (PSC) Monday granted certification to Caribe
Waste Technology "qualifying" its proposed waste plant as a
small power producing facility. The ruling means that the
Islands' public utility will be required to purchase CWT's
export electricity at the utility's avoided cost.  CWT
previously won a competitive procurement and reached agreement
in principle with the government on the terms of a waste
disposal contract, subject to an acceptable agreement with the
public utility.  Agreement with the utility has been delayed
pending the PSC ruling.  Final contract negotiations will now
commence.  Subsequent steps will be to obtain legislative
approval, permits, and financing prior to the start of
construction.


KMART CORP: Equity Committee Taps Goldberg Kohn as Local Counsel
----------------------------------------------------------------
In Chapter 11 megacases like Kmart Corporation's, a statutory
committee's out-of-town counsel is going to need local
assistance. Accordingly, the Equity Committee asks Judge
Sonderby to allow Goldberg, Kohn, Bell, Black, Rosenbloom &
Moritz Ltd to ride shotgun with Traub Bonacquist & Fox LLP.

Equity Committee Chairperson Ronald Burkle says that Goldberg
Kohn has extensive knowledge of, and experience with business
reorganizations, including retail reorganizations under Chapter
11 of the Bankruptcy Code.  Mr. Berkle points to the firm's
prior expertise representing Chapter 11 committees in workouts,
commercial litigation, securities issues, directors and officers
issues, and corporate governance issues.

According to Mr. Berkle, Goldberg Kohn is expected to:

  (a) provide legal advice to the Equity Committee with respect
      to its duties and powers in these cases;

  (b) assist the Equity Committee in its investigation of the
      acts, conduct, assets, liabilities and financial condition
      of the Debtors, the operation of the Debtors' businesses,
      the rationalization and disposition of the Debtors'
      assets, and any other matter relevant to the cases or to
      the formulation of a plan;

  (c) attend meetings and negotiate with the representatives of
      the Debtors and other constituencies;

  (d) assist the Equity Committee in the review, analysis and
      negotiation of any plan of reorganization (and
      accompanying disclosure statements that may be filed,
      including, but not limited to any valuation issues that
      may arise in connection therewith);

  (e) assist the Equity Committee in its investigation of inter-
      company relationships and any actions, litigations or
      other matters that may result;

  (f) assist the Equity Committee, in conjunction with the other
      interested constituencies in these cases, in the
      investigation of the action and activities of past and
      present officers and directors, together with the
      evaluation of any affirmative claims that may flow
      therefrom;

  (g) represent the Equity Committee in connection with matters
      concerning securities, securities fraud claims, and
      corporate governance issues; and

  (h) evaluate any valuation attributed by the Debtors or any
      other constituency to the equity in these cases.

Mr. Berkle tells the Court that Goldberg Kohn will coordinate
with Traub Bonacquist to ensure no duplication of efforts by the
two firms.  The Equity Committee believes that Goldberg Kohn and
Traub Bonacquist can manage and allocate the workload based on
each firm's respective area of expertise.

Goldberg Kohn's current hourly rates are:

                Partner             $300 - 450
                Associate            165 - 275
                Paralegal/Assistant   75 - 125

Randall L. Klein, Esq., a Goldberg Kohn principal, assures the
Court that the Firm does not represent or hold any interest
adverse to the interests of the Equity Committee or the Debtors'
estates.  Although the firm may have represented some parties in
interest in these cases, Mr. Klein emphasizes that these
representations have been withdrawn, terminated or concluded.
"To the best of my knowledge, neither I nor any principal,
associate or other employees of Goldberg, Kohn represents or is
otherwise associated with the Debtors, any of its creditors or
any other parties in interest, other than the Equity Committee,
in connection with the Debtors and these Chapter 11 cases," Mr.
Klein says.

Thus, the Equity Committee seeks the Court's authority to retain
Goldberg Kohn as local counsel, nunc pro tunc to June 14, 2002.
(Kmart Bankruptcy News, Issue No. 26; Bankruptcy Creditors'
Service, Inc., 609/392-0900)

Kmart Corp.'s 9.875% bonds due 2008 (KMART18), DebtTraders
reports, are quoted at a price of 45. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=KMART18for
real-time bond pricing.


LAIDLAW INC: AMR Agrees to Pay $20MM to Settle Civil Claims
-----------------------------------------------------------
The nation's largest ambulance provider has agreed to pay $20
million to settle civil claims filed in federal court alleging
improper Medicare billings.

United States Attorney Michael J. Sullivan, Joseph C. Moraski,
Regional Inspector General of the U.S. Department of Health and
Human Services, Office of Inspector General in New England, and
Charles S. Prouty, Special Agent in Charge of the Federal Bureau
of Investigation in New England, announced that American Medical
Response, Inc., a Colorado-based corporation with Massachusetts
offices located at 4 Tech Circle in Natick, has agreed to pay
$20 million to settle federal civil charges involving claims
submitted to the Medicare Program for non-emergency ambulance
transports provided throughout Massachusetts.

Under Medicare rules, non-emergency ambulance transports must be
medically necessary to qualify for reimbursement.  The civil
settlement resolves allegations by the United States that
between January, 1993 and December, 1998, thousands of false
claims were submitted to Medicare for non-emergency ambulance
transportation services provided in Massachusetts that were not
medically necessary or that lacked valid documentation to
support medical necessity.  The majority of the claims were
submitted by formerly independent Massachusetts providers that
AMR acquired, including Norfolk-Bristol Ambulance, Chaulk
Ambulance, Brewster Ambulance, Worcester Himmer Ambulance,
Frontline Ambulance, Careline-New England and Medtrans of New
England.  The settlement is being paid by AMR as well as through
funds contributed by the former owners of Norfolk-Bristol,
Chaulk and Brewster Ambulance.

"This case demonstrates the Government's steadfast commitment to
ensure that Medicare funds are paid out only for valid,
medically necessary services and to pursue recovery of all
payments that it finds were made in violation of those
standards," said U.S. Attorney Sullivan.

The United States asserts that the ambulance companies falsely
represented to Medicare that Massachusetts patients being
transported by ambulance on routine, scheduled non-emergency
calls were bed confined or had other medical conditions that
rendered it medically necessary for those patients to be
transported by ambulance when, in fact, the companies either had
no information to support the representations contained on the
Medicare claims forms or were in possession of information that
contradicted the representations made on the claims forms.

The United States contends that in connection with the
submission of false and fraudulent claims, the ambulance
companies engaged in the following specific acts:

    i. They submitted or caused to be submitted claim forms
       stating that patients were bed confined or unable to
       walk when they either had no information to support that
       statement or the information in their possession
       indicated that the patient was not bed confined and
       could walk;

   ii. They submitted or caused to be submitted claim forms
       stating "Y" to the question of whether ambulance
       transport was medically necessary when they either had
       no information to support that statement or the
       information in their possession contradicted the
       statement;

  iii. They caused or allowed their employees to falsify
       Certificates of Medical Necessity ("CMN's") attesting to
       the supposed need for transportation by ambulance by,
       for example, forging the signatures of doctors and
       nurses;

   iv. They caused or allowed their employees to fill out or
       add information to Certificates of Medical Necessity,
       notwithstanding the requirement that CMN's submitted to
       the Massachusetts carrier be the requirement that CMN
       submitted to the Massachusetts carrier be completed and
       signed only by physicians or nurses;

    v. They programmed their billing software to describe each
       and every patient as bed confined, by automatically
       inserting a "Y" in the corresponding data field on the
       electronic claims form, irrespective of the actual
       physical condition of the patients and even though
       information contained on the providers' own run reports
       frequently indicated that the patient had not been bed
       confined; and

   vi. They established, implemented and adhered to internal
       policies whereby they would not disclose or make refunds
       to the Massachusetts carrier of payments received from
       Medicare to which they knew they were not entitled
       because the providers knew, or later learned, that no
       medical necessity had existed for the trip.

Through the civil settlement announced today, the U.S.
Attorney's Office has recovered millions of dollars in Medicare
funds that were improperly paid to AMR and its predecessor
corporations, together with penalties and costs.

The underlying improprieties were brought to the attention of
the Government by two "whistleblowers," who will receive
$3,775,000 of the settlement amount.  Pursuant to the provisions
of a federal statute known as the False Claims Act, private
citizens may bring actions seeking to recover, on behalf of the
Government, federal funds improperly paid as the result of the
submission of false or fraudulent claims.  Successful plaintiffs
are entitled to receive between 15 and 25 percent of any
recovery obtained by the United States.

The case was handled by Assistant U.S. Attorney Michael J.
Pineault, assisted by agents from the Inspector General's office
of the Department of Health and Human Services and the Federal
Bureau of Investigation.

                      AMR Has This To Say . . .

American Medical Response had entered into a civil settlement
with the Massachusetts U.S. Attorney's Office to close an
investigation of AMR Massachusetts and seven predecessor
companies.

AMR agreed to pay $20 million to settle civil charges regarding
improper or not fully documented claims for reimbursement for
medical transportation to the Medicare Program. The Government's
investigation largely focused on the conduct of these companies
prior to being acquired by AMR.

Bill Sanger, President and CEO of AMR, said: "AMR fully
cooperated with the Government to uncover and correct
questionable practices that might have existed in some of the
small, independent companies that we acquired.  AMR operations,
across the U.S., have strong professional local management teams
supported by national resources to ensure that all government
regulations are followed.  We are pleased to close the door on
this issue and move forward."

Over the past four years AMR has developed a comprehensive
compliance program, among the most rigorous in the industry,
that includes extensive employee training, among the most
rigorous in the industry, that includes extensive employee
training, system oversight, and detailed reporting.  The
corporate integrity agreement reached between AMR and the Office
of Inspector General of the U.S. Health and Human Services
Department credits the AMR compliance department with
identifying and disclosing these irregularities.

AMR is the nation's largest provider of medical transportation
services with 20,000 employees providing service in 35 states.
(Laidlaw Bankruptcy News, Issue No. 19; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


LAIDLAW INC: Expects to Release Fiscal 2001 Results by July 15
--------------------------------------------------------------
Laidlaw Inc. currently expects to release its audited results
for the fiscal year ended August 31, 2001 by July 15, 2002. The
announcement revises its prior expectation regarding release of
this information prior to June 30, 2002. This delay is due to
the time required to complete and audit the financial
statements.

In June 2001, Laidlaw Inc., and five of its subsidiary holding
companies - Laidlaw Investments Ltd., Laidlaw International
Finance Corporation, Laidlaw One, Inc., Laidlaw Transportation,
Inc. and Laidlaw U.S.A., Inc. filed voluntary petitions for
reorganization under Chapter 11 of the U.S. Bankruptcy Code in
the United States Bankruptcy Court for the Western District of
New York. At the same time, Laidlaw Inc. and Laidlaw Investments
Ltd. filed cases under the Canada Companies' Creditors
Arrangement Act in the Ontario Superior Court of Justice in
Toronto, Ontario. Laidlaw's plan of reorganization, as filed,
contemplates no distribution of value to holders of Laidlaw's
equity.

Consistent with its January 2002 announcement, in accordance
with OSC Policy 57-603, Laidlaw will continue to abide by the
provisions of the alternate information guidelines until it has
satisfied its financial statement filing requirements by making
required filings with the relevant securities regulatory
authorities throughout the period in which it is not in
compliance with such requirements.

Laidlaw Inc. is a holding company for North America's largest
providers of school and intercity bus transportation, municipal
transit, patient transportation and emergency department
management services.


LODGIAN INC: Asks Court, Again, to Extend Exclusivity to Oct. 21
----------------------------------------------------------------
For a second time, Lodgian, Inc., and its debtor-affiliates ask
the Bankruptcy Court to extend their exclusive period in which
to propose and file a plan of reorganization through and
including October 21, 2002.  The Debtors also ask the Court to
extend their exclusive right to solicit acceptances of that plan
from their creditor constituencies through and including
December 18, 2002.  The Debtors make it clear that this second
request is without prejudice to their right to seek additional
extensions of the exclusive periods as may be appropriate.

According to Adam C. Rogoff, Esq., at Cadwalader Wickersham &
Taft in New York, the Debtors initially sought a six-month
extension of their Filing and Solicitation Periods through and
including October 21, 2002 and December 18, 2002, in their first
motion.  The Debtors plainly believe that there were more than
ample grounds to warrant an initial six-month extension --
particularly given the size and complexity of these Chapter 11
cases and the Debtors' business operations and financial
structure.  However, at the request of the Committee, and in
deference to the very productive negotiations between the
Debtors and the Committee regarding certain key elements of a
consensual plan or plans of reorganization, the Debtors
voluntarily modified their request to merely a three-month
extension.  At this time, by seeking a further short extension,
the instant Motion would grant the Debtors with the very same --
and reasonable -- six-month extension originally requested in
their first extension motion.  The requested extensions are
realistic and necessary given the activities and achievements to
date and the multiple tasks to be completed and issues to be
resolved before a confirmable plan can be proposed and
negotiated.

Mr. Rogoff points out that the Debtors are one of the largest
owners and operators of hotels located throughout the United
States (and one hotel in Canada) owning 105 hotels with almost
20,000 rooms and approximately $1,000,000,000 in debt.  To date,
the Debtors have identified in excess of 26,000 creditors.  The
size and complexity of the Debtors' businesses, together with
the Debtors' corporate structure and diverse financing
arrangements, place heavy demands on the Debtors' management and
personnel even in the best of times.  However, the poor economic
environment affecting the hospitality industry generally,
combined with the daily demands of operating in Chapter 11
(including litigation commended by various creditors
constituents including CCA and Hilton), have exacerbated the
demands upon a lean management.

By any reasonable measure, Mr. Rogoff claims that the Debtors'
Chapter 11 cases are sufficiently large and complex to warrant
an extension of the Filing and Solicitation Periods.  As noted
in the Debtors' original motion to extend the Exclusive Periods,
these cases, which involve 82 interrelated legal entities,
thousands of creditors, and close to one billion dollars in
liabilities, is among the larger and more complex Chapter 11
cases -- certainly by Nationwide standards.  Considering the
early stages of their Chapter 11 cases, as well as the size of
the estates and diversity of issues that must be resolved,
neither the Debtors nor any other party in interest could
realistically be in a position to formulate, promulgate and
build consensus for a plan or plans at this time.  The size and
complexity of the Debtors' cases is thus well beyond even the
minimum standards for extending the Exclusive Periods and thus
warrants the proposed additional three-month extension.

Mr. Rogoff assures the Court that the Debtors are continuing to
address the multitude of tasks necessary to the daily
administration of these Chapter 11 cases.  The Bar Date in these
cases was June 3, 2002, only a few weeks prior to the date of
this motion.  The Debtors have been advised that in excess of
3,940 proofs of claim have been filed against their estates.
Accordingly, neither the Debtors nor other parties in interest
have had sufficient time to evaluate and assess the thousands of
claims that have been asserted against the Debtors.  The Debtors
need sufficient time to analyze these claims - let alone prepare
a meaningful disclosure statement containing adequate
information.

Further, the Debtors' restructuring plans and discussions with
various secured and unsecured creditor constituencies regarding
the reorganization process has consumed the majority of the
Debtors' time and efforts in the few months since this Court
approved the Debtors' initial request for an extension, and will
continue to place a great demand on the Debtors' time and
efforts in the upcoming months.

Mr. Rogoff submits that the Debtors have made significant
progress in their plan process.  However, an extension of the
Filing and Solicitation Periods is necessary to allow the
Debtors sufficient time to continue to negotiate a plan or plans
and prepare a meaningful disclosure statement containing
adequate information.

Nonetheless, in spite of considerable distractions on the
Debtors attendant to the litigious activities of various parties
in these cases, the Debtors have made substantial progress
towards formulating a plan or plans of reorganization.  There
are four major issues which need to be resolved in order to put
forth a plan:

  * obtaining the agreement of major unsecured debt holders (the
    Unsecured Senior Subordinated Notes and the CRESTS
    representing approximately $400 million) to a restructuring
    of their interests;

  * obtaining agreement of major franchisors to assumption of
    license agreements and curing of defaults;

  * re-negotiation of high leverage secured debt on certain
    properties (including the properties of the CCA Borrowers);
    and

  * obtaining exit financing.

The Debtors have made significant progress in achieving these
objectives and will continue to focus on accomplishing the goal
of resolving these issues.

Mr. Rogoff informs the Court that an agreement in principle has
been reached with the Creditors' Committee, which is comprised
of the major creditor constituencies, regarding the treatment of
their claims and the future ownership of the reorganized
Debtors. Pursuant to this agreement, the holders of unsecured
senior subordinated notes due 2009, certain "minority interests"
of the Debtors (the "CRESTS"), and current equity will own most
of the equity of the reorganized Debtors.  The agreement should
minimize disputes amongst the constituency groups, and enable
the Debtors' reorganization to go forward on a cooperative
basis.

Mr. Rogoff believes that the Debtors' relationships with their
franchisors, and their ability to maintain quality franchise
flags at their properties, is critical to the reorganization of
the Debtors.  In order to preserve these relationships, it will
be necessary to bring each of the properties into compliance
with the quality assurance and maintenance standards that each
franchisor requires.  In connection with this process, the
Debtors have visited and site inspected 105 hotels, and have
developed budgets and a schedule to do the work necessary to
bring the properties into compliance.  Management has already
met with its major franchisors, and have made significant
strides towards reaching an agreement for the future treatment
of these properties.  These efforts have required extensive
travel and time commitment from senior management, but they are
an essential building block to the Debtors' reorganization.

The third task relates to the "high leverage" properties, which
generally are those properties where the amount of the secured
debt exceeds the value of the collateral.  Mr. Rogoff explains
that high leverage properties do not currently generate enough
cash flow from operations to service the debt associated with
the properties, pay taxes, complete necessary capital
expenditures and otherwise fund operations.  The Debtors have
commenced discussions with the lenders for approximately 30
properties in an effort to determine whether there is a mutually
acceptable basis upon which these properties may be included
within the reorganized Debtors. Negotiations with certain
lenders are still continuing.  These negotiations should be
allowed to progress in order to determine the core configuration
of the reorganized Debtors and to avoid otherwise disrupting the
Debtors' operations.

The fourth and final task which must be achieved in connection
with the plan process is to solicit and obtain exit financing.
Mr. Rogoff notes that the lenders on the Debtors' largest
facility have indicated a strong preference to have their debt
refinanced.  In order to accommodate these requests, and
perhaps, if possible, refinance other portions of the Debtors'
debt on better terms, the Debtors are assisting several
potential lenders with their due diligence activities.  The
Debtors expect that the due diligence process and negotiations
will be extensive and time consuming, but again, both an
integral part of any plan of reorganization.

Mr. Rogoff claims that the first six months of these cases have
been time-consuming, and heavily focused on stabilizing the
Debtors' business operations, and negotiating with franchisors,
secured lenders and the Committee to formulate a plan that is
feasible and that offers the greatest return for each creditor
constituency.  The Debtors have made material progress in their
operational and managerial restructuring.  There have been
various beneficial management changes and continued efforts to
centralize and streamline the Debtors' operations.  These
operational synergies, in turn, provide a foundation for
evaluating the core configuration of going-forward properties
that will be the foundation for the Debtors' Chapter 11 plan or
plans.

Despite the numerous steps taken by the Debtors to date, Mr.
Rogoff claims that they have not had sufficient time to make the
appropriate determinations concerning the best and most feasible
Chapter 11 plan or plans by the July 18, 2002 deadline.
However, the Debtors' progress toward reorganization made to
date has already been significant, and, as indicated above, the
Debtors intend to continue these efforts in the upcoming months.
In these cases, the Debtors' reorganization is proceeding at an
appropriate pace.  Only six months have passed since the Debtors
filed their chapter 11 petitions.  The Debtors' request for an
extension of the Filing and Solicitation Periods is not a
negotiation tactic, but instead, merely a reflection of the fact
that these cases are not yet ripe for the formulation and
confirmation of a viable plan or plans of reorganization.

Mr. Rogoff states that the Debtors have kept sight of the need
to deal with all of their disparate parties in interest in these
cases, including approximately 16 groups of secured lenders and
numerous bondholders, trade vendors, CREST holders, and
franchisers.  The Debtors and their professionals have
consistently conferred with these constituencies on all major
substantive and administrative matters in these cases, often
altering their position in deference to the views of the
Committee, the U.S. Trustee, the postpetition lenders under the
DIP Facility, or other parties in interest.  The Debtors have no
intention of discontinuing this dialog if this motion is
granted.

Mr. Rogoff tells the Court that at the present time, the Debtors
are working together with the Committee regarding the
development of a consensual plan or plans.  In short, in lieu of
"stalling" or "pressuring" creditors, the Debtors have been
concentrating their efforts on cooperating with their major
creditor constituents.  The Debtors have also sufficient
liquidity and are paying their bills as they come due.  This is
unlikely to change given this Court's approval of the Debtors'
use of cash collateral and their $25,000,000 DIP Facility under
which only $750,000 was used for letters of credit and
$24,250,000 remains accessible.

The Debtors submit, in light of the foregoing factors, the
Debtors' request for an additional three-month extension of the
Filing and Solicitation Periods is relatively modest.  As noted
from the cases cited above, this and other courts well-recognize
the benefits and practical necessities of extending a debtor's
Exclusive Periods in large complex cases - particularly when
there is no indication that the debtor is abusing the Chapter 11
process through these extensions. (Lodgian Bankruptcy News,
Issue No. 12; Bankruptcy Creditors' Service, Inc., 609/392-0900)


LOG ON AMERICA: Bankruptcy Filing Likely If Verizon Cuts Service
----------------------------------------------------------------
Log On America, Inc. (Pink Sheets: LOAX.PK) --
http://www.loa.com-- is currently in dispute with Verizon
(NYSE: VZ) -- http://www.verizon.com-- as a result of over
billing that took place over 18 months.  Log On America had
informed Verizon more than 15 months ago that the invoices it
was issuing to LOA were erroneous but Verizon continued to issue
such bills advising the company it was aware of the problem.
After 15 months of ignoring the problem Verizon issued a credit
for over billings to the company of $1.5 million, which the
company believes may be grossly inadequate.  Verizon now has
demanded significant payment on the remaining balance.  If
Verizon interrupts service the company may be forced to seek
protection under the United States Bankruptcy Code and will
review its legal remedies with counsel.

The company also has not received adequate consideration for the
sale of its dial-up unit to Earthlink (Nasdaq: ELNK) --
http://www.earthlink.com  The company asserts that Earthlink is
in breach of its agreement to provide true and accurate monthly
transition data.  Earthlink has failed to provide accurate
transition data for the months ending May and June. Should the
company need to seek protection under United States bankruptcy
code it anticipates filing a petition to unwind the transaction
and recover its 22,000 customer representing over $5.5 million
in annual revenue.

Log On America is a full service provider of business
communication technologies. We deliver a unique end-to-end
customer experience from consultation through professional
managed services. Our core services include: Business Telephone
& Voicemail Systems, Dial-up & High-speed Internet Access,
Website Creation & Hosting, Integrated Voice & Data Services,
Server Collocation, Niche ASP Applications, Managed Service
Level Agreements, and Network Consultancy, Architecture &
Implementation (LAN, WAN, VPN). Our expertise lies in a wide
array of business communication solutions all of which may be
customized and scaled to the specific needs of your business
today and in the future.


LORAL SPACE: Will Release Second Quarter Results By Month-End
-------------------------------------------------------------
Loral Space & Communications (NYSE: LOR) has revised some of its
performance expectations for 2002 and issued new guidance for
the year.

The continuation of the general economic slowdown, particularly
in telecommunications, is affecting Loral's performance this
year. Loral's operations remain healthy and EBITDA positive.
They continue to generate substantial amounts of cash, but the
growth expected this year in the fixed satellite services
segment has not yet materialized. Consequently, the company is
issuing new guidance for the year.

Current guidance for the full year is as follows:

     --  Loral's reported revenues for the year are expected to
rise to approximately $1.2 billion, a 15 percent increase over
last year; previous guidance called for a 20 percent increase.

     --  Loral's EBITDA is expected to decline approximately
five percent from the $223 million reported last year; previous
guidance called for a 15 percent increase.

     --  Consistent with previous guidance, Loral continues to
expect to end the year with $80-$90 million in cash and
available credit, after capital spending of $160 million ($125
million for satellite construction, $35 million for ground
systems), dividend and interest payments, and an investment of
$30 million in XTAR.

     --  The net loss is expected to improve from $276 million
last year to approximately $190 million this year before a
previously reported first-quarter goodwill charge.

     --  Net loss per share (excluding the goodwill write-off)
is expected to be approximately $0.50 versus last year's loss of
$0.86. Without an $0.11 per share non-cash accounting charge
related to the preferred exchanges in the second quarter, the
expected loss would have been slightly better than previous
guidance of $0.40-0.50 per share.

These estimates are better than, or equal to, last year's
results, reflecting an improvement in operating performance at
Loral's satellite manufacturing business. Skynet's business,
however, has been negatively affected by the economic climate
and the delay in demand for new applications and services,
especially broadband. This industry-wide trend is evidenced, for
example, by the postponement of broadband projects due to lack
of funding. In addition, recent events like the early-June
bankruptcy filing by one of Skynet's customers, a direct-to-
consumer broadband company, have adversely affected Skynet's
near-term growth. The company has assessed Skynet's current book
of business and does not believe that its future growth will be
affected by similar defaults. Skynet is expected to maintain its
share of the market this year.

These factors translate for Skynet into an expected capacity
utilization rate of 60 percent at year-end 2002 versus 68
percent at the end of last year. Lease rates for new capacity
have declined recently by about 10 percent. The effect on the
year-end average annual revenue per transponder, however, is a
slight decline from $1.6 million to $1.5 million due to Skynet's
existing, contracted long-term leases. The cost of insurance -
both launch and on-orbit - rose dramatically after the events of
September 11 and has not returned to traditional levels as
expected, adding to satellite operators' costs. Following is
2002 Skynet guidance:

     --  Skynet revenue is expected to decline to approximately
$340 million versus $389 million last year. The company had
previously expected single-digit growth for this unit in 2002.

     --  Skynet's EBITDA is expected to decline approximately 15
percent from $276 million last year. Its EBITDA margin is
expected to be about 68 percent, down from 71 percent last year.

     --  Skynet backlog at the end of the year is expected to be
$1.3 billion or nearly four times revenue, compared to $1.4
billion at the end of the prior year.

With regard to the satellite manufacturing business, 2002
guidance for Space Systems/Loral is as follows:

     --  SS/L revenue is expected to increase about 20 percent
over last year's revenue of $815 million, in line with previous
guidance.

     --  SS/L EBITDA is expected to exceed $40 million, an
improvement of 67 percent over last year's $24 million. SS/L has
aggressively reduced costs to match the current business
environment and is beginning to see benefits from improved
production processes put in place last year. As a result, it
expects that the year-end EBITDA margin will be an improvement
over last year's performance.

     --  SS/L is scheduled to deliver four more geosynchronous
satellites (for a total of eight, an SS/L record) by the end of
the year.

     --  Across the satellite manufacturing industry worldwide,
only one order for the construction of a new commercial
geosynchronous satellite has been placed in the last nine
months. By contrast, 25 contracts were awarded in all of 2001. A
recent increase in requests for proposals (RFPs) along with
recent customer activity, reaffirm Loral's confidence that
orders for satellite construction will pick up in the second
half and that SS/L will capture at least its market share.
SS/L's year-end backlog is expected to be approximately $800
million.

Loral continues to progress but at a slower pace than expected.
The company is managing its operations to match current and
expected business conditions, protect its margins and preserve
liquidity and financial flexibility. The current economic
environment, however, would indicate a delay in Loral's ability
to achieve net profit in late 2003 as previously forecast.

Loral will issue a release reporting its second quarter
performance at the end of July.

Loral Space & Communications is a high technology company that
concentrates primarily on satellite-based services and satellite
manufacturing, including broadcast transponder leasing and value
added services, domestic and international corporate data
networks, broadband data transmission and Internet services. For
more information, visit Loral's Web site at http://www.loral.com

As previously reported, Loral's March 31, 2002 balance sheet
shows that the company has a working capital deficit of about
$143 million.


MCCRORY: Secures OK to Hire New & Neville as Real Estate Broker
---------------------------------------------------------------
McCrory Corporation and its debtor-affiliates ask permission
from the U.S. Bankruptcy Court for the District of Delaware to
employ New & Neville Real Estate Services, Inc. as their real
estate broker to assist with the marketing and sale of the
Estates' interests in certain real property located in Portland,
Oregon.

New & Neville will be employed by the Debtors to perform a
highly specialized task.  The Debtors submit that, inasmuch as
New & Neville's compensation is result-oriented and directly
related to benefits received by the Debtors' Estates per
transaction, New & Neville's submission of fee applications is
unnecessary.  Pursuant to a written Agreement, the Debtors agree
to pay New & Neville a 6% commission from the total
consideration in any transaction.

McCrory Corporation filed for chapter 11 protection on September
10, 2001. Laura Davis Jones, Esq., at Pachulski, Stang, Ziehl,
Young & Jones P.C., represents the Debtors.


MICRO COMPONENT: Violates Nasdaq Continued Listing Guidelines
-------------------------------------------------------------
Micro Component Technology, Inc. (Nasdaq:MCTI) a leading
manufacturer of test handling and automation solutions, with the
largest installed IC test handler base of any manufacturer,
received notification from The Nasdaq Stock Market, dated June
25, 2002, that it does not meet the $50,000,000 market
capitalization requirement contained in Rule 4450(b)(1)(A) for
continued listing on the Nasdaq National Market.

MCT will request a hearing before a Nasdaq Listing
Qualifications Panel to appeal Nasdaq's determination. MCT
expects that it will be up to 45 days before the appeal is heard
by the panel. MCT's common stock will continue to be listed on
the Nasdaq National Market while the appeal is pending.

Roger E. Gower, MCT's Chairman and Chief Executive Officer,
commented: "MCT's common stock has suffered from the steep
decline that has affected the entire stock market, and
semiconductor stocks in particular. The major indexes are now at
levels not seen since September 11th. By way of comparison,
MCT's common stock has declined 19% in 2002, while the SOXX
Index of semiconductor stocks has declined 28% and the Nasdaq
Composite Index has declined 27%. Additionally, MCT has fallen
out of compliance with the Nasdaq listing standards in the past,
and each time has regained its listing status. We are
considering actions to provide the hearing board with sufficient
basis to eliminate or postpone this action by Nasdaq."

MCT is a leading manufacturer of test handling and automation
solutions satisfying the complete range of handling requirements
of the global semiconductor industry. MCT has recently
introduced several new products under its Smart Solutions(TM)
line of automation products, including Tapestry(TM),
SmartMark(TM), and SmartSort(TM), designed to automate the back-
end of the semiconductor manufacturing process. MCT has the
largest installed IC test handler base of any manufacturer, with
over 11,000 units worldwide. Headquartered in St. Paul,
Minnesota, with its Aseco Corporation subsidiary in Marlborough,
Massachusetts, the Company has sales and support offices
worldwide. MCT is traded on the Nasdaq National Market System
under the symbol MCTI.

For more information on the Company, visit its Web site at
http://www.mct.com


NATIONAL STEEL: Grants Bondholders & NUF Adequate Protection
------------------------------------------------------------
In a Court-approved stipulation, National Steel Corporation, its
debtor-affiliates and the Bondholders' Committee agree that:

   -- the Debtors will provide adequate protection on these
      terms:

      (a) Debtors will make provisional payments on a monthly
          basis of:

             (i) reasonable fees and expenses of legal
                 professionals for the Bondholders' Committee,
                 plus payment of reasonable legal fees and
                 expenses of outside counsel to the Trustee,
                 based upon submission of monthly fee statements
                 similar to those submitted by the professionals
                 for the Creditors' Committee;

            (ii) reasonable fees and expenses of one financial
                 advisor to the Bondholders' Committee, based
                 upon submission of monthly fee statements
                 similar to those submitted by the professionals
                 for the Creditors' Committee.  However, if the
                 financial advisor retained by the Bondholders'
                 Committee is to be compensated on a flat
                 monthly basis, the monthly fee shall not exceed
                 $125,000 per month; and

           (iii) reasonable expenses of members of the
                 Bondholders Committee if the expenses are
                 incurred in the performance of the duties of
                 the committee.  The fees and expenses will be
                 subject to the process for payment of fees and
                 expenses, as well as interim and final approval
                 by the Bankruptcy Court.

      (b) to secure the claims for the ratable benefit of all
          First Mortgage Bondholders, the Trustee will be
          granted liens and security in all of the Debtors'
          assets not constituting Petition Date Bondholders
          Collateral.  The Adequate Protection Liens shall be:

             (i) subject to the approved subordination terms,
                 junior and subordinate to the liens granted on
                 the Adequate Protection Collateral, and any
                 valid, enforceable liens in existence on the
                 Petition Date to which the Dip Facility liens
                 are subject;

            (ii) senior and superior to any liens granted on the
                 Adequate Protection Collateral that secure any
                 prepetition or postpetition claims of NKK
                 Corporation or its affiliates;

           (iii) subject and subordinate to the Carve-Out, which
                 Carve-Out will also be for the benefit of the
                 fees and expenses professionals retained by the
                 Bondholders Committee; and

            (iv) ratable liens on a pari passu basis with any
                 adequate protection liens granted by the
                 Debtors in the Adequate Protection Collateral.

   -- subject to the further approval of the Bankruptcy Court,
      the Debtors may also grant adequate protection liens on
      the Petition Date Bondholder Collateral as adequate
      protection to other secured creditors.  However:

      (a) the liens are junior, subject and subordinate in all
          respect to the Petition Date Bondholder Liens; and

      (b) the holders of the junior liens will be subject to an
          agreement with terms similar to those in the
          Subordination Agreement.

   -- The Adequate Protection Liens granted under this
      Stipulation will secure:

      (a) interest on the principal amount owing under the First
          Mortgage Bonds since the Petition Date at the default
          contract rate, but only to the extent that the First
          Mortgage Bondholders are entitled to be paid
          postpetition interest.  The Debtors reserve their
          rights to challenge the postpetition interest; and

      (b) the amount of diminution of the value of the Petition
          Date Bondholder Collateral from the Petition Date.

   -- consistent with the Final DIP Order, the DIP Lenders
      exercise their rights upon the Adequate Protection
      Collateral or Petition Date Bondholder Collateral.  The
      automatic stay will be deemed modified to allow the
      Trustee to exercise any rights they may have with respect
      to the Petition Date Bondholder Collateral and Adequate
      Protection Collateral;

   -- the Debtors waive any right to contest the validity and
      enforceability of the claims of the First Mortgage
      Bondholders as of the Petition Date, or the validity and
      enforceability of the Petition Date Bondholder Liens on
      the Petition Date Bondholder Collateral.  The Creditors'
      Committee and other parties have until the earlier
      of these dates to file appropriate pleadings to challenge
      the claims, the validity or priority of liens held by the
      Bondholders in the Petition Date Bondholder Collateral:

      (a) a date, which is 90 days from the date of a written
          notice from counsel to the First Mortgage Bondholders
          to counsel for the Creditors' Committee stating a date
          by which the claims must be brought; or

      (b) a date, which is 90 days from the date on which the
          First Mortgage Bondholders declare in writing that
          the Stipulation is terminated.  If no challenge or
          claim is made, then the claims and liens of the First
          Mortgage Bondholders shall be deemed valid and binding
          on all parties.

   -- the Debtors must cooperate in providing reasonable access
      as requested by the Bondholders Committee financial
      advisor to evaluate and analyze the Petition Date
      Bondholder Collateral for all valuation purposes;

   -- the Debtors must provide copies of all reports provided
      to the Creditors' Committee, subject to the execution of
      confidentiality agreements; however, materials relating to
      disputes or potential disputes with the First Mortgage
      Bondholders will not be provided;

   -- on not less than 30 days' notice to the Debtors, the
      Creditors' Committee, and Agent for the DIP Lenders, the
      Bondholders Committee may terminate this Stipulation, and
      seek further adequate protection for any reason.  Upon
      termination, all obligations of the Debtors will cease,
      provided that all rights existing as of the effective date
      of the termination shall remain in full force and effect;

   -- the Debtors, the Trustee and the Bondholders Committee
      reserve all rights with respect to all valuation issues.
      The Debtors reserve all rights as to whether the First
      Mortgage Bondholders are entitled to adequate protection.
      If the Debtors, the Trustee and the Bondholders Committee
      are unable to reach an agreement with respect to the
      amount and treatment of First Mortgage Bondholder claims
      or adequate protection claims, disputes will be resolved
      by the Bankruptcy Court;

   -- if the Debtors agree to provide adequate protection to a
      secured creditor, they may only agree to grant adequate
      protection on terms similar to those granted.  Nothing
      shall be deemed a waiver of the restrictions on the
      provision of adequate protection by the Debtors contained
      in the DIP Facility or the Subordination Agreement.  This
      shall only apply to adequate protection terms agreed to by
      the Debtors on a consensual basis;

   -- the Trustee may file a copy of this Stipulation as a
      financing statement.  This Stipulation will evidence the
      validity and priority of the Adequate Protection Liens
      without any need for the Indenture Trustee or First
      Mortgage Bondholders to file or record this Stipulation
      for the purpose of perfecting the interests granted.
      (National Steel Bankruptcy News, Issue No. 10; Bankruptcy
      Creditors' Service, Inc., 609/392-0900)

DebtTraders says that National Steel Corp.'s 9.875% bonds due
2009 (NSUS09USR1) are quoted at a price of 37. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=NSUS09USR1
for real-time bond pricing.


NATIONSRENT: Balks At John Hancock's 2nd Request for Documents
--------------------------------------------------------------
Debtors, NationsRent Inc., Nationrent of Indiana, Inc.,
NationsRent of Texas, Inc. and Logan Equipment Corporation
object to John Hancock's second batch of interrogatories and
document requests.

Michael J. Merchant, Esq., at Richards, Layton & Finger, P.A.,
in Wilmington, Delaware, observes that, in its second motion,
John Hancock tries to paint an emergency scenario that simply
does not exist.  The Debtors have compiled the information John
Hancock seeks.  On June 12, 2002, the Debtors over-nighted that
information to John Hancock.  John Hancock also exaggerates the
urgency surrounding its purported need for the information by
misconstruing the adequacy of the Debtors' Letter of Credit and
by misrepresenting the potential for further equipment losses.

Mr. Merchant claims that the Debtors have prepared and produced
an Operating Lease Disposal Report that provides information
with regards to John Hancock's leased equipment that has been
sold, lost, or stolen since January 1, 2001.  The Disposal
Report lists for the period September 14, 2001 through May 30,
2002, all leased equipment that has been lost, sold or stolen.
The Debtors have also implemented a Manager's Action Plan that
is designed to ensure greater control over leased equipment,
including special guidelines for the sale of leased and third-
party financed equipment.  A copy of the Disposal Report and
Manager's Action Plan were provided to John Hancock's counsel.

"Significantly, since Petition Date only 26 pieces of equipment
(out of a total of approximately 14,000 pieces of equipment)
have been disposed of, and of those 26 items, only six were
disposed of after the implementation of the Manager's Action
Plan in March 2002 -- equipment units were either stolen or
destroyed by the customer," Mr. Merchant reports.  "None of the
equipment was disposed of as a result of a sale by the Debtors.
Thus, John Hancock's allegation that 14,000 pieces of leased
equipment are imminent danger of disappearance is not only a
gross hyperbole but untrue and unfounded."

In addition, Mr. Merchant avers that John Hancock's professed
concern over the adequacy of the $500,000 Letter of Credit is
equally unfounded.  The sum was determined by the DIP Lenders
and the Debtors based upon the review of the Debtors' history
with leased equipment.  The Letter of Credit was intended to
provide security for postpetition, not prepetition, equipment
losses, and then only in the event the Debtors cease making
timely lease payments.  Notably, the Debtors have timely made
its postpetition equipment lease payments.

Mr. Merchant further argues that John Hancock is not entitled to
an award of attorneys' fees.  Despite statements to the
contrary, the Debtors served their responses to the discovery
requests on John Hancock's local counsel on May 28, 2002.  This
satisfied the deadline set in John Hancock's May 28, 2002 Letter
of Credit. The Debtors have also furnished John Hancock with the
Disposal Report and the Manager's Action Plan that contains the
information it seeks. (NationsRent Bankruptcy News, Issue No.
14; Bankruptcy Creditors' Service, Inc., 609/392-0900)


NEON COMMS: Wants Court to Appoint BSI as Notice Agents
-------------------------------------------------------
NEON Communications, Inc., and its debtor-affiliate, NEON
Optica, Inc., move the Court to appoint Bankruptcy Services LLC
as the official claims, noticing and balloting agent in their
chapter 11 cases.

The Debtors have identified hundreds of creditors and other
parties in interest to whom certain notices and voting documents
must be sent. The magnitude of the Debtors' creditor body makes
it infeasible for the Clerk's Office to undertake that task and
send notices to the creditors and other parties in interest.

Pursuant to the Agreement, the Debtors anticipate that BSI will:

     a. prepare and serve required notices in these chapter 11
        cases;

     b. within five business days after the service of a
        particular notice, file with the Clerk's Office a
        certificate or affidavit of service;

     c. maintain copies of all proofs of claim and proofs of
        interest filed in these cases;

     d. maintain an official claims register in this case by
        docketing all proofs of claim and proofs of interest in
        a claims database that includes the following
        information for each such claim or interest asserted;

     e. name and address of the claimant or interest holder and
        any agent thereof, if the proof of claim or proof of
        interest was filed by an agent;

     f. date the proof of claim or proof of interest was
        received by BSI and/or the Court;

     g. claim number assigned to the proof of claim or proof of
        interest; and

     h. asserted amount and classification of the claim;

     i. implement necessary security measures to ensure the
        completeness and integrity of the claims register;

     j. transmit to the Clerk's Office a copy of the claims
        register on a weekly basis, unless requested by the
        Clerk's Office on a more or less frequent basis;

     k. maintain an up-to-date mailing list for all entities
        that have filed proofs of claim or proofs of interest
        and make such list available upon request to the Clerk's
        Office or any party in interest;

     l. provide access to the public for examination of copies
        of the proofs of claim or proofs of interest filed in
        this case without charge during regular business hours;

     m. record all transfers of claims and provide notice of
        such transfers as required if directed to do so by the
        Court;

     n. comply with applicable federal, state, municipal and
        local statutes, ordinances, rules, regulations, orders
        and other requirements;

     o. provide temporary employees to process claims, as
        necessary;

     p. promptly comply with such further conditions and
        requirements as the Clerk's Office or the Court may at
        any time prescribe; and

     q. provide such other claims processing, noticing,
        balloting, and related administrative services as may be
        requested from time to time by the Debtors.

The customary rates charged by BSI in similar retention are:

          Kathy Gerber          $195 per hour
          Senior consultants    $175 per hour
          Programmer            $125 - $150 per hour
          Associate             $125 per hour
          Data Entry/Clerical   $40 - $60 per hour

NEON Communications, Inc. owns certain rights to fiber and all
of the outstanding stock of NEON Optica, Inc., which owns and
operates a fiber optic network services. The Company filed for
chapter 11 protection on June 25, 2002. David B. Stratton, Esq.
at Pepper Hamilton LLP represents the Debtors in their
restructuring efforts. When the Debtors filed for protection
from its creditors, it listed $55,398,648 in assets $19,664,234
in debts.


NOMURA CBO: S&P Hatchets Class A-3 Notes Rating to CCC from BB+
---------------------------------------------------------------
Standard & Poor's lowered its rating on the class A-3 notes
issued by Nomura CBO 1997-2 Ltd., an arbitrage CBO transaction
originated in October 1997, to triple-'C' from double-'B'-plus,
and removed it from CreditWatch with negative implications,
where it was placed on May 20, 2002. At the same time, the
triple-'A' rating assigned to the class A-1 and A-2 notes are
affirmed based on the high level of overcollateralization
available to support the two tranches. The rating assigned to
the class A-3 notes had previously been lowered to double-'B'-
plus from single-'A' on December 18, 2001.

This CreditWatch placement reflects factors that have negatively
affected the credit enhancement available to support the notes
since the December 18, 2001 rating action, primarily par erosion
of the collateral pool securing the rated notes.

As a result of asset defaults and credit risk sales at
distressed prices, the overcollateralization ratios for Nomura
CBO 1997-2 Ltd. have deteriorated. According to the most recent
monthly report (June 2, 2002), the class A overcollateralization
ratio was 105.29%, compared to a ratio of 111.92% as of the Dec.
2001 rating action, and substantially below the current minimum
required class A overcollateralization ratio of 121%. Currently,
$60.825 million (or 17.79%) of the assets in the collateral pool
come from defaulted obligors rated 'D' or 'SD' by Standard &
Poor's, and another $13.393 (or 3.93%) come from obligors rated
double-'C', considered highly vulnerable to default.

Standard & Poor's has reviewed the results of current cash flow
runs generated for Nomura CBO 1997-2 Ltd. to determine the level
of future defaults the rated tranches can withstand under
various stressed default timing scenarios while still paying all
of the rated interest and principal due on the notes. After the
results of these cash flow runs were compared with the projected
default performance of the current collateral pool, it was
determined that the rating assigned to the class A-3 notes was
no longer consistent with the credit enhancement available,
resulting in the lowered rating.

               RATING LOWERED; REMOVED FROM CREDITWATCH

                      Nomura CBO 1997-2 Ltd.

                  Rating
     Class     To       From                 Current Balance
     A-3       CCC      BB+/Watch Neg        $105.3 million

                         RATINGS AFFIRMED

                     Nomura CBO 1997-2 Ltd.

               Class   Rating     Current Balance
               A-1     AAA        $32.6 million
               A-2     AAA        $150.0 million


NOMURA CBO: S&P Slashes Class A-2 Notes Rating to BB-
-----------------------------------------------------
Standard & Poor's lowered its rating on the class A-2 notes
(current balance of $274.554 million) issued by Nomura CBO 1997-
1 Ltd., an arbitrage CBO transaction, to double-'B'-minus from
single-'A'-minus, and removed it from CreditWatch with negative
implications, where it was placed on May 20, 2002.

The lowered rating reflects factors that have negatively
affected the credit enhancement available to support the notes
since the transaction was originated in June 1997. These factors
include par erosion of the collateral pool securing the rated
notes and a downward migration in the credit quality of the
performing assets within the pool.

As a result of asset defaults, Nomura CBO 1997-1 Ltd.'s
overcollateralization ratios have deteriorated. According to the
most recent monthly trustee report (June 2, 2002), the class A-2
overcollateralization ratio was at 114.4%, versus the current
required minimum ratio of 126%. Currently, $58 million (or
16.6%) of the assets in the collateral pool come from defaulted
obligors rated 'D' or 'SD' by Standard & Poor's, and another
$11.75 million (or 3.4%) come from obligors rated double-'C',
considered highly vulnerable to default.

The credit quality of a number of the performing assets within
the collateral pool has also migrated downward. Currently,
$17.74 million (or 6.35% of the performing assets in the
portfolio) come from obligors with Standard & Poor's ratings in
the triple-'C' range, and $30.685 million (or 10.98% of the
performing assets) come from obligors with ratings that are on
CreditWatch negative.

Standard & Poor's has reviewed the results of current cash flow
runs generated for Nomura CBO 1997-1 Ltd. to determine the level
of future defaults the class A-2 notes can withstand under
various stressed default timing scenarios while still paying all
of the rated interest and principal due on the notes. The
results of these cash flow runs were compared with the projected
default performance of the current collateral pool and it was
determined that the rating previously assigned to the class A-2
notes was no longer consistent with the credit enhancement
available to support the tranche, resulting in the lowered
rating.


PACIFIC GAS: Wins Nod to Execute Terms Re Forbearance By Banks
--------------------------------------------------------------
Pacific Gas and Electric Company obtained Court approval, with
the support of the Creditors' Committee, to amend and restate
the terms of the Prior Term Sheet by entering into the Term
Sheet With Respect to Forbearance and Proposed Revised Treatment
of Letter of Credit Bank Claims in the Plan of Reorganization,
which PG&E has entered into with the various counter-parties.

As previously reported, Pacific Gas and Electric Company is
currently benefiting from certain below market-rate loans made
to PG&E by the California Pollution Control Financing Authority
with the proceeds from the sale of certain tax-exempt revenue
bonds. Pursuant to their terms, the bonds cannot remain
outstanding unless they continue to be secured by letters of
credit or certain other forms of credit enhancement, and PG&E is
obligated to repay the loans by reimbursing the Letter of Credit
issuing banks for all draws made on the letters of credit that
are used to pay the bonds. Defaults by PG&E would give the
letter of credit issuing banks the right to cause redemption of
the bonds through draws on their letters of credit.

PG&E did default -- as debtor in possession, it has not
reimbursed the Letter of Credit Issuing Banks for any of the
payments they have made pursuant to the several post-petition
draws on their Letters of Credit.

However, no declaration of default and no redemption of bonds
has occurred because the parties negotiated and entered into a
term sheet (the Prior Term Sheet) and obtained the Court's
approval of it, as reported at [00354] and [00329].

The Prior Term Sheet provides that, subject to certain
conditions, the letter of credit issuing banks will extend the
terms of their respective letters of credit, and will forbear
from exercising remedies that would result in the redemption of
the bonds, for a limited period, in exchange for the payment of
certain increased letter of credit fees and certain other
concessions by the Debtor.

Under the Prior Term sheet, one of the conditions for continued
forbearance by the banks is the confirmation, on or before
September 30, 2002, of a plan of reorganization which will
provide for the treatment of the claims of the letter of credit
issuing banks in the manner as then set forth in the Debtor's
plan of reorganization, or for alternative treatment which is
acceptable to the banks.

The Debtor has requested, and the letter of credit issuing banks
have agreed, subject to certain terms and conditions, to waive
this condition of the September 30, 2002 deadline for plan
confirmation, provided that a plan of reorganization which
provides for the treatment of their claims in the manner set
forth in the new Term Sheet, or for alternative treatment
acceptable to them, becomes effective on or before June 1, 2003.

The parties accordingly entered into the First Amended and
Restated Summary of Terms With Respect to Forbearance and
Proposed Revised Treatment of Letter of Credit Bank Claims in
the Plan of Reorganization (the Term Sheet). The terms of the
Term Sheet maintain the bulk of the provisions as the Prior Term
Sheet with some adjustments in fees and provisions under the
Plan of Reorganization in accordance with the change regarding
the deadline for confirmation of the plan.

In this motion, the Debtor asks for the Court's approval of the
Term Sheet. The Debtor tells the Court that the provisions of
the new Term Sheet will provide it with additional time to
confirm a plan of reorganization that would permit the
reorganized Debtor to retain the benefits of the tax-exempt
financing offered by the continued existence of the Letter of
Credit Backed PC Bonds. In the business judgment of the Debtor,
the increased fees and other adjustments encompassed in the Term
Sheet are fair and reasonable. The Debtor notes that the
substantial interest cost savings by maintaining the benefits of
the outstanding tax-exempt financing more than offset the cost
of the fees. The Debtor believes that entry into the Term Sheet
is in the best interest of the PG&E estate.

                 Salient Term Sheet Provisions

A.  Agreements by the Letter of Credit Issuing Banks.

(1) Forbearance:

    Each of the Letter of Credit Issuing Banks has agreed to

    (i) maintain its Letter of Credit outstanding in its current
    stated amount, and

    (ii) not provide the Bond Trustee with notice of any default
    under its Reimbursement Agreement or non-reinstatement of
    its Letter of Credit or take any other action which would
    result in the mandatory tender or redemption of any of the
    outstanding Letter of Credit Backed PC Bonds without the
    prior written consent of PG&E until the earlier of: (x) the
    last interest payment date on the related series of Letter
    of Credit Backed PC Bonds immediately preceding the
    expiration date of such Letter of Credit, as such expiration
    date will be extended in accordance with the terms of the
    Term Sheet, and (y) the occurrence of a "Termination Event."

    In addition to Termination Events as described in the Prior
    Term Sheet, under the Term Sheet, a "Termination Event" will
    have occurred if "a plan of reorganization of PG&E which
    provides for the treatment of Allowed Letter of Credit Bank
    Claims in the manner described in the Term Sheet or for
    alternative treatment of Allowed Letter of Credit Bank
    Claims which is acceptable to the Letter of Credit Issuing
    Banks does not become effective on or before June 1, 2003.

(2) Extension of Letter of Credit Expiration:

    Within 30 days after the date of this Motion, each of the
    Letter of Credit Issuing Banks will have extended the term
    of its Letter of Credit for at least one year.

B.  Agreements by the Debtor.

(1) Reimbursement of Interest Draws:

    Within 10 days after the date this Motion is approved by the
    Court, PG&E will reimburse the Letter of Credit Issuing
    Banks for the amounts drawn under their respective Letters
    of Credit for the payment of interest on the related Letter
    of Credit Backed PC Bonds, together with all accrued and
    unpaid interest due on such amounts, all to the extent
    provided in the Reimbursement Agreements. Thereafter, PG&E
    would currently reimburse the Letter of Credit Issuing Banks
    for all amounts drawn under their Letters of Credit for the
    payment of interest on the Letter of Credit Backed PC Bonds.

   Under the Prior Term Sheet, reimbursement would commence on
   the Confirmation Date.

   The Debtor points out that the proposed change from the terms
   of the Prior Term Sheet would merely accelerate the date such
   payments would be made by the Debtor but would not expand its
   obligations.

   The Debtor believes that the change is not only a reasonable
   concession to make to the Letter of Credit Issuing Banks for
   the extensions of the term of forbearance, but is also in the
   best interest of the Debtor's estate, considering that:

   -- the subject payments accrue interest from the date of each
      draw until paid at an average fluctuating annual rate of
      interest approximately equal to one and one-half percent
      in excess of the prime rate.

   -- in accordance with the Court's Order on Debtor's Emergency
      Motion for Order Authorizing Continuing Use of (1) Certain
      Bank Accounts, (2) Cash Management System, and (3)
      Corporate Investment Policy dated April 6, 2001, the funds
      the Debtor has available to satisfy such obligations have
      been, and are expected to continue to be, invested in
      short-term obligations which have an average yield
      substantially below the prime rate,

(2) Additional Fees:

   During the period from and after the Motion Approval Date and
   continuing until July 1, 2002, PG&E will be required to pay
   to each of the Letter of Credit Issuing Banks, quarterly, in
   arrears, the Original Letter of Credit Fee, together with an
   amount equal to the positive difference, if any, of an amount
   per annum equal to 2% of the Stated Amount of the Letter of
   Credit, less the Original Letter of Credit Fee (together, the
   Initial Letter of Credit Fee). This amount of total fee will
   accrue from and after December 1, 2001 and until July 1,
   2002, and will be payable on the same dates as are set forth
   for payment of Letter of Credit Fees in the applicable
   Reimbursement Agreement.

   During the period from and after July 1, 2002 and continuing
   until the Effective Date, PG&E will be required to pay to
   each of the Letter of Credit Issuing Banks, quarterly, in
   arrears, the Original Letter of Credit Fee, together with an
   amount equal to the positive difference, if any, of an amount
   per annum equal to 3% of the Stated Amount of the Letter of
   Credit, less the Original Letter of Credit Fee. This amount
   of total fee will accrue from and after July 1, 2002 until
  the Effective Date, and will be payable on the same dates as
   are set forth for payment of Letter of Credit fees in the
   applicable Reimbursement Agreement.

   The Term Sheet also provides that within 10 days after the
   Motion Approval Date, PG&E is required to pay to Deutsche
   Bank AG New York Branch an agency fee in the amount of
   $250,000 as additional compensation for acting as the
   administrative agent under the terms of its Reimbursement
   Agreement during the period from and after December 1, 2001
   through the Effective Date.  This is provided that if no
   Termination Event has occurred prior to June 30, 2002 and
   Deutsche Bank AG is not in default of its obligations under
   the Term Sheet, the agency fee will be deemed fully earned on
   the earlier of the Confirmation Date or June 30, 2002.

   The Debtor believes that the changes are reasonable and
   necessary.

(3) Professional Fees:

   The Term Sheet provides that PG&E will pay the reasonable
   fees and expenses of unrelated third party professionals
   retained by the Letter of Credit Issuing Banks, to the extent
   incurred subsequent to April 6, 2001 in connection with the
   Chapter 11 case of PG&E no later than 30 days subsequent to
   each date a reimbursement request is made in writing by the
   Letter of Credit Issuing Bank to PG&E.

   PG&E notes that the retention of this provision as in the
   Prior Term Sheet does not expand PG&E's obligations, but, in
   light of the full payment of creditors proposed in the
   Amended Plan, only serves to accelerate the timing of the
   reimbursement of the Letter of Credit Issuing Banks for such
   costs. Again, given the substantial benefits to PG&E from
   this deal, PG&E believes that such concession by PG&E was,
   and continues to be, minor and justified.

(4) Purchase in Lieu of Redemption:

   For United States federal income tax purposes, Letter of
   Credit Backed PC Bonds which have been purchased, rather than
   redeemed or cancelled, remain outstanding. However, the
   cooperation of the Banks is necessary in order to provide a
   mechanism by which the Letter of Credit Backed PC Bonds can
   be purchased. Thus, the Term Sheet retains the provision as
   in the Prior Term Sheet for PG&E and the Letter of Credit
   Issuing Banks to cooperate in a mutual attempt to amend the
   related bond documents to permit the Letter of Credit Issuing
   Banks to purchase the Letter of Credit Backed PC Bonds under
   certain circumstances in which the Letter of Credit Backed PC
   Bonds would otherwise be subject to redemption and
   cancellation. The Debtor tells the Court that such amendments
   to the respective Loan Agreements and Indentures would not be
   adverse to the interests of the holders of Letter of Credit
   Backed PC Bonds and would enhance PG&E's ability to maintain
   the benefits of  the tax-exempt financing provided by the
   Letter of Credit Backed PC Bonds.

   In relation to the change in provision regarding the date of
   confirmation of the plan, the Term Sheet provides that, in
   the event that a plan of reorganization acceptable to the
   Letter of Credit Issuing Banks does not become effective on
   or before June 1, 2003, then each Bank will have the right,
   but not the obligation, to cause the related series of Letter
   of Credit Backed PC Bonds to be tendered for purchase,
   subject to a first lien security interest in favor of the
   respective Letter of Credit Issuing Bank to additionally
   secure the obligations of PG&E under the related
   Reimbursement Agreement, and shall  not take any action which
   would cause the related series of Letter of Credit Backed PC
   Bonds to be called for redemption unless certain Termination
   Events occur.

   This change extends the date before which the Letter of
   Credit Issuing Banks are permitted to exercise the purchase
   right from June 30, 2002 to June 1, 2003, thus granting the
   Debtor additional time to confirm and consummate its plan of
   reorganization while maintaining the Letter of Credit Backed
   PC Bonds outstanding at the tax-exempt rate.

C.  Treatment of Allowed Letter of Credit Bank Claims.

(1) Proposed Plan Treatment:

   The Term Sheet provides that the plan of reorganization
   propounded by PG&E will treat Allowed Letter of Credit Bank
   Claims in substantially the same manner as the Prior Term
   Sheet with the following three exceptions:

     * First: that portion of Allowed Letter of Credit Bank
       Claims that were to be satisfied by the delivery of long-
       term notes under the Prior Term Sheet and the Amended
       Plan, will instead be paid in Cash on the Effective Date;

     * Second: Allowed Letter of Credit Bank Claims with respect
       to Letters of Credit that may hereafter be drawn for the
       payment of the redemption price of Letter of Credit
       Backed PC Bonds will not be subject to conversion to
       Prior Bond Claims (Class 41) as provided in the Prior
       Term Sheet and the Amended Plan, but will instead be
       treated under the No Bonds Option as described above; and

     * Third: the Term Sheet adds the payment of certain fees
       to the treatment of Allowed Letter of Credit Bank Claims
       provided in the Prior Term Sheet and Amended Plan in
       decreasing amounts from the Remarketing Option Incentive
       Fee, to the Purchase Option Incentive Fee, to the No
       Bonds Option Fee, in order to induce the Letter of Credit
       Issuing Banks to (i) maintain their Letter of Credits
       securing Letter of Credit Backed PC Bonds that

   In addition, regardless of the treatment option selected by
   the Debtor, the Term Sheet provides that in the event that on
   or prior to the Effective Date, the Amended Plan is further
   amended by the Debtor to increase the amount payable to the
   holders of Prior Bond Claims or General Unsecured Claims on
   the Effective Date, then on the Effective Date of the
   Debtor's plan of reorganization the Debtor would be required
   to pay to each Letter of Credit Issuing Bank an additional
   fee in an amount proportionately equal to the greater of (i)
   the average additional cash amounts that holders of Prior
   Bond Claims would receive on the Effective Date, or (ii) the
   average additional cash amounts that holders of General
   Unsecured Claims would receive on the Effective Date.

   The Debtor has agreed to pay the additional fees in the event
   that it elects to so amend its plan of reorganization as an
   inducement to the Letter of Credit Banks to enter into the
   Term Sheet and to extend the term of their forbearance.


PANAVISION INC: Repurchases $37MM 9-5/8% Sr. Sub. Discount Notes
----------------------------------------------------------------
Panavision Inc. (NYSE: PVI) has entered into a joint venture, to
be known as EFILM LLC, with Deluxe Laboratories, Inc., the
leading worldwide supplier of film processing services to major
motion picture studios and filmmakers.

The joint venture, of which Panavision will own 80% and Deluxe
20%, will provide digital laboratory services, including high-
resolution scanning of film, digital color timing, laser film
recording of digital video and high definition images to film
and digital mastering to major film studios, independent
filmmakers, advertisers, animators, large format filmmakers and
restoration clients. Panavision and Deluxe believe that the
joint venture will allow them to capitalize on the extremely
important and consistently increasing role of digital filmmaking
and film services in the entertainment industry.

Panavision is contributing its existing EFILM business to the
joint venture and Deluxe is contributing cash. In connection
with its entry into the joint venture, Panavision purchased the
stock of the company that owns the assets Panavision previously
leased to operate the EFILM business, for a $6.7 million note
and the assumption of certain obligations.

Separately, Panavision announced that it has retired $37,726,000
principal amount of its 9-5/8% Senior Subordinated Discount
Notes Due 2006. The Notes, on which there was approximately $1.5
million of accrued and unpaid interest, were acquired, along
with $10 million in cash, from Mafco Holdings Inc. in exchange
for 49,199 shares of a new Series B Cumulative Pay-In-Kind
Preferred Stock, having a liquidation preference of $1,000 per
share. The Preferred Stock pays dividends at an annual rate of
10% and is redeemable by Panavision at any time at the
liquidation preference plus accrued and unpaid dividends. At
Panavision's option, dividends may be paid in cash or by the
issuance of additional shares of Series B Preferred Stock.

Panavision also assigned to Mafco its April 1, 2002, Option
Agreement with certain holders of Panavision's Notes. Pursuant
to the assignment, Mafco made a $5.5 million payment due under
the Option Agreement and agreed to purchase $78,355,000
principal amount of Panavision's Notes in exchange for
$50,930,750 plus accrued interest.

Panavision also announced that Mafco has entered into an
agreement with M & F Worldwide Corp. (NYSE: MFW), Panavision's
controlling shareholder, granting M & F Worldwide Corp. certain
rights to purchase from Mafco the Series B Preferred Stock, as
well as the Notes being purchased pursuant to the Option
Agreement.

John S. Farrand, President and Chief Executive Officer of
Panavision, commented, "The steps we announce [Tues]day are part
of Panavision's ongoing efforts to position itself for the
future. They increase our financial flexibility and further
cement Panavision's leadership position in digital filmmaking. I
am particularly pleased that Deluxe is our new joint venture
partner in EFILM. Deluxe brings a wealth of knowledge,
experience, and client relationships to the venture."

Panavision is a leading designer, manufacturer and supplier of
high precision camera systems, comprising cameras, lenses and
accessories, for the motion picture and television industries.

                         *    *    *

As previously reported, Moody's Investors Service downgraded the
debt ratings of Panavision Inc.

Rating Action                                    To        From

   * $195 million of 9 5/8% senior subordinated   Ca        Caa1
     discount notes, due 2006,

   * $340 million of secured bank credit           B3        B2
     facilities,

   * the company's senior implied rating          Caa1       B2

   * senior unsecured issuer rating               Caa3       B3

In addition, Moody's assigned new ratings.

Rating Action                                    Assigned Rating

   * Panavision's $30 million senior                     B3
     secured revolving credit,

   * $150 million senior secured Term Loan B,            B3

   * $250 million senior secured notes due 2009         Caa2

Rating outlook is negative. And at the close of the proposed
transaction, Moody's will withdraw the ratings on Panavision's
existing bank facility.

The lowered ratings reflect Moody's belief that the company's
capital structure is over leveraged at present. Panavision is
subject to volatility of revenues and impact from threatened and
real strike activities. Panavision's revenue and cash flow
performance has also fallen short of Moody's expectations. If
the proposed transaction is successful, current note holders are
expected to receive less than par for their existing bonds.


POLAROID: Wants to Continue Employee Severance Plan thru Sept 30
----------------------------------------------------------------
According to Eric M. Davis, Esq., at Skadden, Arps, Slate,
Meagher and Flom, in Wilmington, Delaware, Polaroid
Corporation's Severance Program for current employees will
expire on June 30, 2002. However, the Debtors still wish to
further reduce the headcount of up to 200 more employees by the
third quarter.

Accordingly, the Debtors seek the Court's authority to extend
the implementation of the Severance Program through September
30, 2002 with the expected cost of $1,700,000.

Since the implementation of the Severance Program, Mr. Davis
says, the Debtors expect that they will have terminated
approximately 583 employees by June 30, 2002.  These employees
will have received about $3,100,000 from the Severence Program.
This cost is well below the $5,700,000 budget the Court approved
for the Severance Program to have terminated on December 30,
2001.  Thus, even with the additional cost that will be incurred
in the proposed extension of the Program, Mr. Davis notes that
it is still well below the previously approved budget.  Mr.
Davis attributes the cost savings to the large number of
employees who voluntarily terminate their employment with the
Debtors.

Pursuant to Section 105(a) of the Bankruptcy Code, Mr. Davis
asserts, the extension should be granted because:

  (a) it is extremely difficult to attract new qualified
      employees so the Severance Program is essential to retain
      existing employees until the Asset Sale is finalized; and

  (b) the cost associated with the extension is more than
      justified when weighed against the turmoil and loss of
      value that would be attendant to mass defection by the
      employees. (Polaroid Bankruptcy News, Issue No. 19;
      Bankruptcy Creditors' Service, Inc., 609/392-0900)

Polaroid Corporation's 11.50% bonds due 2006 (PRD3), DebtTraders
says, are trading at about 1.25. For real-time bond pricing, see
http://www.debttraders.com/price.cfm?dt_sec_ticker=PRD3


PRANDIUM INC: Court-Confirmed Plan Takes Effect July 2, 2002
------------------------------------------------------------
Prandium, Inc. (OTC Bulletin Board: PRDM) announced that its
Plan of Reorganization as confirmed by the U.S. Bankruptcy Court
in Santa Ana, California, on June 20, 2002, became effective
Tuesday, July 2, 2002.

"We look forward to beginning a new chapter in our company's
history," stated Kevin Relyea, Prandium Chief Executive Officer.
"Our very talented team has operated over the past 6 years under
the constraints of a capital structure that limited in
significant ways our competitive options.  As we come out of the
starting blocks, our management team is energized by the
prospects of running in the competitive race with a less
significant amount of debt."

Under the confirmed plan of reorganization, Prandium's 9-3/4%
Senior Notes were cancelled in exchange for 5 million shares of
common stock in Prandium, Inc.; the 14% Senior Secured Discount
Notes of FRI-MRD Corporation were exchanged at a discount for
cash; and the FRI-MRD 15% Senior Discount Notes were exchanged
at a discount for cash and new FRI-MRD 12% Notes (which will
require no cash principal or interest payments until January
2005).  Previous equity securities of Prandium, Inc. and
Prandium's 10-7/8% Senior Subordinated Discount Notes were
cancelled for no consideration.

The Company also announced that it has signed a new loan
agreement with Foothill Capital Corporation, its senior lender
since 1997, providing for a $15 million line of credit.

The record date for the exchange of the Company's 9-3/4% Senior
Notes for stock is June 28, 2002.  For a short period of time,
the Company stock will trade under the symbol of PRDMV.  For
details of the exchange, please see Prandium's Web site at
http://www.prandium.com

Relyea concluded, "We are also appreciative of our legal team at
Skadden, Arps, Slate, Meagher & Flom, LLP and our financial
advisors at Crossroads, LLC for their counsel over the past 18
months.  In addition, without the tremendous support of our
creditors, bankers, suppliers, business partners and employees,
this process would have been much more difficult."

Prandium operates a portfolio of full-service and fast-casual
restaurants including Chi-Chi's, Koo Koo Roo, and Hamburger
Hamlet.  Prandium, Inc. is headquartered in Irvine, California.
To contact the company call (949) 863-8500, or link to
http://www.prandium.com


PRIME RETAIL: Lender Extends Payment Due Date to August 15, 2002
----------------------------------------------------------------
Prime Retail, Inc. (OTC Bulletin Board: PMRE, PMREP, PMREO)
announced its mezzanine loan lender has elected to extend the
July 1, 2002 mandatory principal payment due date to the earlier
of (i) August 15, 2002 or (ii) the occurrence of an event of
default under the mezzanine loan.  Additionally, upon the
satisfaction of certain conditions, the Extended Date will be
further extended to the earlier of (i) October 31, 2002, (ii)
the occurrence of an event of default under the mezzanine loan,
or (iii) the closing or termination of certain asset sales. The
outstanding balance of the mezzanine loan was $35.4 million as
of June 30, 2002.  The Company was required to make mandatory
principal payments with net proceeds from asset sales or other
capital transactions of not less than (i) $8.9 million by May 1,
2002, (ii) $24.4 million, inclusive of the $8.9 million, by July
1, 2002 and (iii) $25.4 million, inclusive of the $24.4 million,
by November 1, 2002.  The Company made the May 1, 2002 mandatory
principal payment.

Prime Retail is a self-administered, self-managed real estate
investment trust engaged in the ownership, leasing, marketing
and management of outlet centers throughout the United States
and Puerto Rico.  Prime Retail currently owns or manages 43
outlet centers totaling approximately 12.2 million square feet
of GLA.  The Company also owns one community shopping center
totaling 27,000 square feet of GLA and 154,000 square feet of
office space.  Prime Retail has been an owner, operator and a
developer of outlet centers since 1988.  For additional
information, visit Prime Retail's Web site at
http://www.primeretail.com


PRIMUS TELECOMMUNICATIONS: Expands Mobile Gateway Service
---------------------------------------------------------
PRIMUS Telecommunications Group, Incorporated (NASDAQ: PRTL), a
global facilities-based Total Service Provider offering an
integrated portfolio of voice, data, Internet, and hosting
services, announced the successful expansion of its "Mobile
Gateway Service" to include calls originating in Canada, France,
Italy, Spain, the United Kingdom and the United States. As a
leader in global telephony with over 8 billion international and
domestic customer minutes in 2001, PRIMUS now completes calls
anywhere in the world which are originated with a mobile phone
in six of its operating markets.

"We developed this service to address a major disparity in the
market -- the excessive costs mobile customers have to pay for
international calls," said K. Paul Singh, Chairman and Chief
Executive Officer of PRIMUS. "By using our new service, those
customers can save in excess of 90% of the cost charged on their
regular in-country mobile originating international calls.

"Now available through six PRIMUS operating units around the
world, we are particularly pleased with this product because it
enables us to capitalize on the fast growing mobile phone
segment, which has been credited with taking share away from the
fixed line market. With our new Mobile Gateway Service product,
the "replacement technology" is, to an extent, being replaced.
In addition, the new service requires no capital expenditure to
deploy and no incremental cost to deliver.

"International telecommunications is our core competency and we
have developed a platform to deliver a number of services
regardless of the access method -- fixed line or mobile,
narrowband or broadband -- and protocol -- circuit or packet. We
are positioned to introduce new revenue generating services with
attractive margins which enable us to cost-effectively add
customers and, at the same time, provide value to those
customers. This is another example where PRIMUS can leverage its
global network and its local market presence to create a new
service which offers users substantial savings on their
international calls."

Mobile phone users can subscribe to PRIMUS's Mobile Gateway
Service even though they may not be using PRIMUS as their
traditional office or home provider for fixed line long distance
services. This new service is an example of how PRIMUS intends
to cost-effectively grow its share of the international
telecommunications market by offering potential and existing
customers both basic and value added services at reasonable
rates while ensuring a high quality of service. PRIMUS has begun
offering international termination for mobile phone calls to
many of its 2.4 million customers around the world, while cross-
selling new Mobile Gateway Service customers with a full suite
of voice, data, Internet and other communications services.

"The primary customer appeal of PRIMUS's Mobile Gateway Service
is its lower cost," said Andrew Reid, General Manager of PRIMUS
Telecommunications in the United Kingdom. "Due to the vast range
of tariffs and different savings options associated with mobile
phone plans, most people are not aware of their pricing plans
and simply accept paying a higher price for their calls, or they
keep mobile international calls to a minimum." PRIMUS can change
this by offering a product that allows mobile users to make
international calls at traditionally lower fixed voice plan
rates. Callers can simply dial a standard access number followed
by the desired destination number and their calls will be
connected though PRIMUS's global network.

"PRIMUS has gone a step further to make this service even more
compelling for customers," Mr. Reid added. "In the UK & Europe
PRIMUS has developed in-house an enhancement to the Mobile
Gateway Service which is offered through PRIMUS-owned and
operated data centers. The Company has innovatively integrated
its Mobile Gateway Service into a secure Web site to allow
customers to populate an interactive phonebook to speed-dial
international calls, view their registered users and view
completed calls. PRIMUS intelligently routes calls to the
desired international destination at a fraction of the direct
dial cost charged by many mobile phone plans. This process
reduces delays and eliminates short codes, pin codes and
navigation of complicated menus, while providing users with
complete control and visibility of their account. Users can
simply save access numbers onto the mobile handset in the normal
way and connect to the PRIMUS network immediately. This makes
the product sticky, creating lock-in and loyalty, which
contributes to securing revenues."

To subscribe or learn more about PRIMUS's Mobile Gateway
Services, please go to:

    * http://www.primustel.cain Canada;
    * http://www.primustelecom.frin France;
    * http://www.primustel.itin Italy;
    * http://www.primustel.comin Spain;
    * http://www.planet-talk.co.ukin the UK; and,
    * http://www.myprimus.comin the US.

PRIMUS Telecommunications Group, Incorporated (NASDAQ: PRTL) is
a global facilities-based Total Service Provider offering
bundled data, Internet, digital subscriber line (DSL), e-
commerce, web hosting, enhanced application, virtual private
network (VPN), voice and other value-added services. The Company
owns and operates an extensive global backbone network of owned
and leased transmission facilities, including over 300 IP
points-of-presence (POPs) throughout the world, ownership
interests in over 23 undersea fiber optic cable systems, 21
international gateway and domestic switches, and a variety of
operating relationships that allow the Company to deliver
traffic worldwide. PRIMUS has been expanding its e-commerce and
Internet capabilities with the deployment of a global state-of-
the-art broadband fiber optic ATM+IP network. Founded in 1994
and based in McLean, VA, the Company serves corporate, small-
and medium-sized businesses, residential and data, ISP and
telecommunication carrier customers primarily located in the
North America, Europe and Asia Pacific regions of the world.
News and information are available at the Company's Web site at
http://www.primustel.com

                         *    *    *

As previously reported in March, the senior unsecured debt
rating on international long-distance carrier Primus
Telecommunications Group Inc., was lowered on March 6, 2002 to
'CCC+'. The other ratings on company were affirmed at that time,
and all ratings were removed from CreditWatch, where they had
been placed on May 8, 2001, due to heightened liquidity
concerns.

The downgrade of the unsecured debt did not reflect a diminution
of the company's overall credit quality. Rather, it was based on
the fact that additional funding for the company is expected to
be largely secured in nature, which would cause the ratio of
priority obligations relative to a reasonable total asset value
to exceed 30%. Under Standard & Poor's criteria, this metric is
the threshold for rating debt two notches below the corporate
credit rating.

The affirmation of the company's corporate credit rating was
based on the fact that near-term concerns about Primus's
liquidity have been alleviated by its opportunistic buyback of a
portion of its debt, the equity conversion of some of its
subordinated convertible debt, and cost containment efforts.
Largely as a result of these factors, the company is most likely
funded through 2002.

                         *    *    *

Primus Telecommunications Group's 12.75% bonds due 2009 (PRTL4)
are quoted at a price of 44, DebtTraders reports. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=PRTL4for
real-time bond pricing.


RANOR INC: Seeking Nod to Use Secured Lenders' Cash Collateral
--------------------------------------------------------------
Ranor, Inc. wants the U.S. Bankruptcy Court for the Southern
District of New York to give it authority to use its Secured
Lenders' cash collateral and approve an adequate protection
package to secure those lenders' liens.  PNC Bank, National
Association, ING Capital LLC, Keybank National Association,
Sovereign Bank, Oceanfirst Bank, The Bank of New York, and U.S.
Bank National Association d/b/a Firststar Bank, N.A. are Ranor's
secured lenders.

The Debtor need immediate access to their lenders' cash
collateral to fund essential business operations and to preserve
the value of its estate, pending consummation of its intended
sale of substantially all of its assets.  The value of the
Debtor's estate will be maximized by the continuation of Ranor
as an ongoing business, and the use of cash collateral is
essential to the Company's operations, the Debtor adds.

Without the ability to use the lenders' Cash Collateral, it will
not be able to make payroll and sustain operations, to the
detriment of all of the Debtor's employees, creditors and the
estate at large.

The Debtors provide the Court with a copy of their budget,
showing projected expenses of $3,410,258 from June to September,
2002.

Ranor Inc. specializes in the fabrication and precision
machining of large metal components that exceed one hundred tons
for the aerospace, nuclear, military, shipbuilding and power
generation markets as well as national laboratories. The Company
filed for chapter 11 protection on June 25, 2002. J. Andrew Rahl
Jr., Esq., at Anderson Kill & Olick, P.C. represent the Debtor
in its restructuring efforts. When the Debtor filed for
protection from its creditors, it listed $18,211,284 in assets
and $7,655,775 in debts.


REPUBLIC TECHNOLOGIES: Will Auction-Off Assets on Monday
--------------------------------------------------------
Republic Technologies International LLC provided the following
update on its previously announced plans to sell its assets.

As of 4 p.m. Tuesday, Republic had received a total of 10
proposals to purchase various portions of the company's assets.
These proposals range in scope from significant portions of the
assets, to individual plants, to parcels of property. These
proposals are in addition to Republic's previously disclosed
asset purchase agreement with KPS Special Situations Fund and
Hunt Investment Group to sell a significant portion of the
company's assets.

By order of the U.S. Bankruptcy Court in Akron, Ohio, proposals
were due at noon Tuesday, and were open to any combination of
assets. An auction has been scheduled for Monday, July 8, among
qualified bids, with a sale approval hearing scheduled for
Tuesday, July 9.

The company is reviewing the proposals to determine whether they
are qualified, based on procedures and requirements ordered by
the bankruptcy court. Among the bid requirements are a cash
deposit and an asset purchase agreement without contingencies
for due diligence or financing. Republic plans to respond to
each bidder by the end of the week. The company will not comment
publicly on any of the bids nor disclose the identity of the
bidders.

"We continue to operate our facilities as we serve our customers
under business-as-usual conditions," said Joseph F. Lapinsky,
president and chief executive officer. "As soon as decisions are
made, we will communicate promptly with our customers,
employees, suppliers, union official and leaders of the
communities where we operate. We appreciate the support we have
received from all of these groups over the past year, and we
look forward to assuring a smooth transition."

Republic Technologies International, based in Fairlawn, Ohio, is
the nation's largest producer of high-quality steel bars. With
nearly 4,000 employees and 2001 sales of approximately $1
billion, Republic was included in Forbes magazine's 2001 and
2000 lists of the largest U.S. private companies. Republic has
plants in Canton, Massillon, and Lorain, Ohio; Beaver Falls,
Pa.; Chicago and Harvey, Ill.; Gary, Ind.; Lackawanna, N.Y.; and
Hamilton, Ont. The company's products are used in demanding
applications in the automotive, agricultural, aerospace, off-
highway, industrial machinery and energy industries.


SLI INC: Senior Bank Lenders Agree to Forbear Until July 31
-----------------------------------------------------------
SLI, Inc. (NYSE: SLI), one of the world's largest vertically
integrated lighting manufacturers, is not making its scheduled
principal payment due July 1, 2002.  The company also announced
that the company and its senior bank lenders have entered into a
forbearance agreement with respect to its current defaults,
including the payment default.

The company said the forbearance was for 30 days, and would last
until July 31, 2002, with the company continuing to negotiate a
long-term amendment with its senior lenders.

Frank M. Ward, Chairman and CEO commented, "The company is
continuing to explore all of its strategic alternatives to
provide for the company's current liquidity issues."

SLI Inc., based in Canton, MA, is a vertically integrated
designer, manufacturer and seller of lighting systems, which are
comprised of lamps and fixtures.  The company offers a complete
range of lamps (incandescent, fluorescent, compact fluorescent,
high intensity discharge, halogen, miniature incandescent, neon,
LED and special lamps).  They also offer a comprehensive range
of fixtures.  The company serves a diverse international
customer base and markets, has 37 plants in 12 countries and
operates throughout the world. SLI, Inc. is also the #1 global
supplier of miniature lighting products for automotive
instrumentation.


SHOPKO STORES: Fitch Affirms Low-B Ratings on Facility & Notes
--------------------------------------------------------------
Fitch Ratings has affirmed its ratings on Shopko Stores Inc.'s
(SKO) bank credit facility at 'BB-' and senior notes at 'B'. The
Rating Outlook remains Negative, reflecting the company's
weakened financial profile and competitive challenges longer
term. Approximately $550 million of debt is affected.

The ratings consider SKO's highly competitive operating
environment as well as difficulty in achieving meaningful
results from its Pamida division. The ratings also acknowledge
SKO as a niche operator with a large portfolio of owned stores
(approximately 60%).

SKO has competed against the top two specialty discounters (Wal-
Mart and Target) for some time, with the level of their
penetration in SKO's key markets continuing to increase.
Nonetheless, the Shopko division, which accounts for 75% of
total revenues, has recently shown a slight increase in
comparable store sales, up 2.9% for the first quarter of FY
2003. The Pamida division's sales continue to lag - with same
store sales for the quarter of -5.5%. Despite negative sales
trends operating margins at Pamida have improved as this
division appears to have controlled its inefficiencies in its
warehouse and inventory management.

Despite mixed operating results, the company has improved its
credit profile by focusing on debt reduction. The company has
retired approximately $200 million of total debt in the past
year by redirecting its focus from growing/adding new stores to
utilizing excess cash flow to retire long-term debt. While
capital expenditures will likely increase in 2002 from the
maintenance levels in 2001 ($17 million), further debt
retirement is anticipated. Debt repayment will be achieved via a
combination of cash from operations and availability on its bank
credit agreement. Approximately $170 million matures in 2003 and
2004. Longer term, the company's operating results need to
improve in order to shift the focus from debt refinancing to
becoming a more competitive operator. Also, the company is in
the midst of a search for a new CEO. Fitch anticipates that
there may be further operating changes once new management is in
place.


SPORTS AUTHORITY: Moody's Reviewing Low-B's for Possible Upgrade
----------------------------------------------------------------
Moody's Investors Service placed The Sports Authority, Inc. on
review for possible ratings upgrade following the company's
registration statement to sell common equity, whose proceeds
will be used to reduce debt.

Affected Ratings are:

     * Senior implied rating of B2

     * $335 million senior secured revolving credit facility
       rated B2

     * Senior unsecured issuer rating of B3.

The rating outlook has been positive based on improving
fundamental operating trends.

The Sports Authority, Inc. is the largest U.S. retailer of
sporting goods. The company is headquartered in Fort Lauderdale,
Florida.


SWAN TRANSPORTATION: Panel Taps Anderson as Insurance Counsel
-------------------------------------------------------------
In Swan Transportation Company's on-going chapter 11 proceeding,
the U.S. Bankruptcy Court for the Southern District of New York
gave its stamp of approval to the Official Unsecured Creditors'
Committee's request to retain Anderson Kill & Olick, PC as its
Insurance Counsel.

The Committee relates that the Debtor carries coverage with
respect to tort claims including to those referenced in Tyler
Technologies, Inc. at al. V. Aetna Casualty & Surety Co. at al.
The Debtor's claims under these policies are a significant asset
of the Debtor's estate.  Pursuit of those claims will require
substantial investigation into policies that covered the Debtor
and the extent of coverage.

The Committee selected Anderson Kill because of the firm's
expertise and experience in analyzing insurance coverage and
recovery issues.

Specifically, Anderson Kill will:

     a) advise the Committee regarding matters of Debtor's
        insurance coverage available for payment of claims of
        asbestos-related or other toxic exposure claims,
        including gaps in coverage, overlapping coverage
        provided by multiple carriers and availability of excess
        insurance coverage;

     b) exchange correspondence and information with
        insurance carriers regarding claims and defenses and
        provide settlement analyses to the Committee; and

     c) advise the Committee regarding insurance issues in
        connection with Debtor's chapter 11 case;

     d) advise the Committee regarding the Coverage
        Litigation involving Debtor; and

     e) render such other necessary advice as the Committee
        may require.

Anderson Kill's professionals will bill at their customary
hourly rates:

          Robert M. Horkovich              $525
          Rhonda D. Orin                   $325
          Michelle Gallagher               $290
          Robert Y. Chung                  $225
          Karen R. Rozinski (paralegal)    $140

Swan Transportation Company filed for chapter 11 protection on
December 20, 2001. Tobey Marie Daluz, Esq., Kurt F. Gwynne, Esq.
at Reed Smith LLP and Samuel M. Stricklin, Esq. at Neligan,
Tarpley, Stricklin, Andrews & Folley, LLP represent the Debtor
in its restructuring efforts. When the Company filed for
protection from its creditors, it listed assets and debts of
over $100 million.


SYSTEMAX INC: In Default Under Revolving Credit Agreement
---------------------------------------------------------
Systemax Inc. (NYSE: SYX) announced an initiative to reduce
costs and improve efficiency by combining two facilities in Port
Washington, New York, resulting in the net elimination of
approximately 50 positions. In addition, the Company announced
the discontinuance of the development of a new customer order
management software system that was being written for the
internal use of certain of the Company's domestic subsidiaries.
In connection with these decisions, Systemax will report a pre-
tax charge of approximately $13.5 million in the quarter ended
June 30, 2002.  The Company has determined that the software is
unusable and has filed a complaint in federal court seeking
restitution of all payments made to the software developers.

The charge has caused an event of default under the terms of the
Company's revolving credit agreement. Systemax currently
anticipates receiving a waiver of the default from its lenders.
There are currently no borrowings outstanding under the credit
agreement.

Richard Leeds, Chairman and Chief Executive Officer, said that
the Company remains focused on adjusting its expenses to current
business conditions and improving operating efficiency. "The
beneficial impact of these actions will commence in the third
quarter of this year," he commented.

Systemax -- http://www.systemax.com-- has developed an
integrated system of branded e-commerce Web sites, direct mail
catalogs, and relationship marketing to sell brand name and
private label PC hardware, related computer products, and
industrial products, to businesses in North America and Europe.
Systemax is a Fortune 1000 company.


TANDYCRAFTS: Wants to Tap Environmental Strategies as Consultant
----------------------------------------------------------------
Tandycrafts, Inc. and its debtor-affiliates want to bring-in
Environmental Strategies Corporation, as environmental
consultants to render environmental investigation services at
Tandycrafts' property located at 1400 Everman Parkway, in Ft.
Worth, Texas.

In connection with a proposed sale of the Property, the Debtors
relate that they were made aware of certain potential
environmental conditions at the Property that made it necessary
for them to conduct additional environmental investigations in
discrete areas.

In the exercise of their reasoned business judgment, the
Debtors, in the best interests of their estates and creditors,
retain Environmental Strategies as environmental consultants to
perform a limited Phase II environmental investigation at the
Property.

Pursuant to the Agreement, Environmental Strategies will perform
specified testing and laboratory analysis at the Property
including:

     a) Collecting samples of the liquid and sludge from the
        oil/water separator and analyzing same for volatile
        organic compounds and waste classification parameters.
        Removing the liquid and sludge from the oil/water
        separator and powerwashing and inspecting the oil/water
        separator for evidence of deterioration. Removing the
        liquid and sludge and properly disposing of those wastes
        off site;

     b) Soil borings will be drilled along each of the perimeter
        of the oil/water separator (four borings) and the
        perimeter of the maintenance building (four borings).
        Soil samples will be collected continuously from grade
        to the water table (approximately 8 feet below grade).
        Soil samples will be collected from 48-inch intervals
        using direct push sampling equipment. Each sample will
        be spilt into 6-inch intervals and screened for organic
        vapor using a PID. The samples with the highest PID
        reading or, if all PID readings are the same, the sample
        from the 6-inch interval above groundwater will be
        analyzed for volatile organic compounds;

     c) Four groundwater samples will be collected from the soil
        borings with the highest PID readings, if all PID
        readings are the same, the groundwater samples will be
        collected from the presumed downgradient boring
        locations. A field decontaminated stainless steel screen
        will be driven to approximately 3 feet below the
        soil/groundwater interface, a peristaltic pump will be
        used to purge groundwater from the screen until the
        groundwater is relatively clear, and dedicated tubing
        will be used to collect the samples. The samples will be
        analyzed for volatile organic compounds;

     d) Groundwater samples will be collected from the eight
        existing onsite monitoring wells and analyzed for
        volatile organic compounds;

     e) Preparation of a report in accordance with the Texas
        Natural Resource Conservation Commission requirements
        summarizing the field investigation and analytical
        results and evaluating environmental conditions at the
        Property; and

     f) Other services as may be requested by the Debtors.

Tandycrafts agrees to pay Environmental Strategies its usual and
customary hourly rates:

          president and
              vice-presidents      $125 - $170 per hour
          support staff            $40 - $60 per hour

The parties estimate total fees won't exceed $18,700.

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


US AIRWAYS: Fisher Asks Pres. Bush to Back $900MM Loan Guarantee
----------------------------------------------------------------
Attorney General Mike Fisher asked President George W. Bush to
support $900 million in federal loan guarantees from the Air
Transportation Stabilization Board for US Airways, which has
faced financial difficulties since the Sept. 11 terrorist
attacks.

"US Airways has been hard hit by the severe downturn the airline
industry has experienced since September 11th," Fisher wrote to
President Bush.  "We must do everything we can to see this vital
industry through these troubling times."

On Sept. 22, 2001, President Bush signed a law that created the
ATSB to compensate eligible air carriers for losses incurred as
a result of the Sept. 11 terrorist attacks.  The ATSB may issue
as much as $10 billion in federal credit instruments to assist
eligible airlines.  US Airways on Friday completed its
application to the ATSB for the loan guarantees.

"US Airways maintains hub airports in both Philadelphia and
Pittsburgh. Overall, it employs more than 16,000
Pennsylvanians," Fisher wrote.  "It is a critical part of the
Commonwealth's economy.  The airline's payroll in the Pittsburgh
region alone is almost $1 billion.  The impact on Pennsylvania's
workforce and families should US Airways not survive its
financial crisis would be devastating."

Fisher noted that US Airways is Pennsylvania's eighth largest
employer with more than $50 million in annual tax revenues.
Fisher said US Airways has taken every step to ensure it would
be able to meet the obligations of the debts it incurs.  He said
the airline's management has been engaged in negotiations with
its employee unions, its suppliers and its vendors to reduce its
operating costs by almost $1.2 billion a year.

"The chilling effect the September 11th tragedies has had on the
travel industry must not be allowed to force one of the nation's
largest carriers into bankruptcy or worse," Fisher wrote
President Bush.  "You and Congress acted swiftly in establishing
the Air Transportation Stabilization Board, which was
specifically designed to counteract the crisis US Airways finds
itself in now."

Fisher noted that US Airways is a dominant carrier in
Pennsylvania and the Northeast.  If it were allowed to fail, the
absence of US Airways in the Northeast market would hurt
consumers by reducing competition and result in higher fares.

US Airways Inc.'s 10.375% bonds due 2013 (USAIR3), DebtTraders
says, are trading at about 81.5. For real-time bond pricing, see
http://www.debttraders.com/price.cfm?dt_sec_ticker=USAIR3


VIASYSTEMS GROUP: Moody's Further Junks $500MM Senior Sub. Notes
----------------------------------------------------------------
Moody's Investors Service took several rating actions on
Viasystems Group, Inc.

Downgraded                                       To        From
                                                 ----      ----
   * $500 million 9-3/4% senior                  Ca        Caa3
     subordinated notes, due 2007;

   * Senior implied rating                       Caa2       B3

   * Senior unsecured issuer rating              Caa3      Caa1

Confirmed                                             Rating
                                                      ------
   * $148 million guaranteed senior secured tranche     B3
     B term loan, due 2007;

   * $289 million guaranteed senior secured Chips       B3
     term loans, due 2005;

   * $150 million guaranteed senior secured revolving   B3
     credit facility, due 2005, of which $71 million
     had been drawn as of March 31, 2002;

Outlook is revised to stable from negative.

The ratings downgrade reflect the increased uncertainty over the
principal amount recoverable on Viasystem's senior subordinated
notes. The risk lies in the company's ability to strengthen its
balance sheet and improve upon its free cash flow coverage of
fixed charges, made more urgent by Viasystem's missed interest
payment on the notes.

Moody's believe that the company still has adequate liquidity at
present to continue funding its operations although the
company's exposure to the telecommunications end market will
continue to pressure operating margins.

Viasystems Group, Inc. is a leading, full-service provider of
electronics manufacturing services. The company is headquartered
in St. Louis, Missouri.


WASH DEPOT: Wants Until Sept. 3 to Make Lease-Related Decisions
---------------------------------------------------------------
Wash Depot Holdings, Inc. and its debtor-affiliates ask the U.S.
Bankruptcy Court for the District of Delaware to further extend
their time to assume, assume and assign or reject unexpired
nonresidential real property leases.  The Debtors want their
Lease Decision Period extended until the earlier of:

     i) entry of a final order confirming a chapter 11 plan for
        the Debtors; or

     ii) September 3, 2002.

All of the Leases are assets of the Debtors' estates and are
integral to the Company's continued operations as it seeks to
reorganize.  The Debtors wish to preserve these leases as assets
of the estates until such time as the Company can make an
orderly determination whether each lease should be assumed or
rejected.

The Debtors have filed their chapter 11 plan and disclosure
statement.  This Court approved the Disclosure Statement and set
a confirmation hearing for July 31, 2002.

Wash Depot Holdings, Inc. which provides car washing services,
filed for chapter 11 protection on October 1, 2001 together with
its direct and indirect subsidiaries. Michael R. Lastowski, Esq.
at Duane, Morris & Heckscher LLP and Daniel C. Cohn, Esq. at
Cohn, Kelakos, Khoury, Madoff & Whitesell LLP represent the
Debtors in their restructuring efforts.


WILLIAMS COMMS: Bittners Doubt Intentions in Bankruptcy Filing
--------------------------------------------------------------
George E. Bittner and Kay A. Bittner ask the Court to reject
Williams Communications Group's bankruptcy filing.  In a
letter, dated June 10, 2002, addressed to Judge Bernstein, the
Bittners expresse disbelief as to WCG's true intentions in
seeking bankruptcy protection.

"We believe that The Williams Companies is an interested
stockholder, illegally attempting to form a combination with
WCG, as defined and prohibited under Section 203 of the Delaware
General Corporation Law," Mr. Bittner alleged.  WCG specifically
pointed out in a SEC POS AM filed in December 18, 2001 that is
subject to Section 203.  Mr. Bittner contends that a prima facie
affiliation is established as the result of financial agreements
between TWC and WCG.

WCG has reached separate agreements with TWC, and with certain
of the Lenders and certain Note-holders, which allow a
comprehensive financial restructuring and de-leveraging of the
Company's balance sheet.  The restructuring agreements, while to
be implemented through a Chapter 11 reorganization plan, will,
convert WCG's existing debt into 100% of the new common stock of
WCG.  The plan will also wipe out existing shareholder interests
and make no distributions to plaintiffs in prepetition class
action shareholder lawsuits.  The reorganized Debtors will also
install a new nine-member board of directors and grant two-year
Rights of First Offer to certain of the Note-holders who have
executed Lock-Up Agreements with respect to future debt and
equity offerings.

Mr. Bittner recounts that, prior to March 30, 2001, SEC filings
show that Keith E. Bailey was Chairman of the Board of both WTC
and WCG.  Also at that time, Howard E. Jenzen, and Steven J.
Malcom were members of WCG's board.  Publications by the firms
show that, Howard E. Jenzen, is President and CEO and Chairman
of WCG, and Steven J. Malcom, is President and CEO and Chariman
of Williams GP LLC.  They are currently both directors of BOK
Financial Corporation which banking and bank-related activities
are primarily performed through Bank of Oklahoma, N.A.  The Bank
of Oklahoma is listed as a creditor in this bankruptcy filing.

Mr. Bittner further alleges that WCG has also published press
releases from January 1, 2001 through April 22, 2002 making
positive statements about the company.  For instance, in a press
release on January 25, 2000 WCG stated that it "has raced past
the milestone of 26,000-route miles of fiber on track toward a
year-end objective of 33,000 miles."  They further stated that
the "turbo-charged" network construction plan got under way in
February 1999, squeezing the initially planned four-year project
into three in response to the exploding demand for bandwidth.
This plan increases Williams' original $2,700,000,000 financial
commitment to $4,700,000,000.

"It is completely unclear, why, with the network almost fully
complete, WCG found it necessary to seek additional massive
sources of capital," Mr. Bittner observes.  "Sophisticated
reorganization plans and business strategies cannot be prepared
overnight. The company surely must have known well in advance,
and may have known from the very beginning, where this would
end."

Specifically, little more than one year later, in a press
release on March 15, 2001, WCG stated that:

  "WCG Note Trust, a special purpose subsidiary, intends to
  issue $1,400,000,000 in structured notes due 2004 in a private
  placement by the end of the month. The proceeds will be used
  for capital spending on telecommunications assets."

If the assets were appropriately accounted for in the original
budget, what other significant capital spending took place, Mr.
Bittner points out.

"We believe that our investment of $73,000 is being stolen from
us," Mr. Bittner claims. He suggests that a close examination of
corporate records and officers would very likely show other
affiliations and should be the subject of a court ordered audit.

The Bittners are stockholders as joint tenants in common and
also as trustees and sole direct beneficiaries of certain
revocable trusts, holding a total of 16,000 shares in the
Williams Communications Group Inc. (Williams Bankruptcy News,
Issue No. 6; Bankruptcy Creditors' Service, Inc., 609/392-0900)


WORLD AIRWAYS: Applies for $27 Million Federal Loan Guarantee
-------------------------------------------------------------
World Airways, Inc. (Nasdaq: WLDA) announced that it filed an
application on Friday June 28, 2002, with the Air Transportation
Stabilization Board, pursuant to the Air Transportation and
System Stabilization Act established by Congress after the
September 11 terrorist attacks, for $27 million in federal loan
guarantees. If the loan guarantee request is approved, World
Airways plans to raise a total of $30 million.

"We believe we can make a compelling case to the ATSB," noted
Hollis Harris, chairman and CEO of World Airways. "The loan
would strengthen our working capital position and help us return
to profitability."

World Airways plays an essential role in the U.S. aviation
system, with a fleet of seven DC 10-30 and eight MD-11 aircraft.
The Company has been in continuous operation since 1948 and
produced $318 million in revenue for fiscal 2001. Its global
customer base includes the U.S. Air Force, the Company's largest
customer. World Airways has participated in the Civil Reserve
Aircraft Fleet (CRAF) program since its inception, and the
Company is the leading carrier in transporting long-haul
military passengers.

The tragic events of September 11 resulted in weakened passenger
and cargo demand, which had a significant, adverse impact on the
financial performance of World Airways. The Company has
developed a restructuring plan aimed at returning the airline to
profitability and enhancing cash flow. The plan includes
temporary aircraft lease payment concessions and instituting
company- wide line item cost reduction programs. The Company
also completed an Employee Salary Exchange Program, in which
employees exchanged 10 percent of their salary for World Airways
stock. All these initiatives have contributed to lower unit
costs and enhanced cash flow.

World Airways' loan application includes a detailed seven-year
business plan, which shows increased utilization of existing
aircraft, expanded sales efforts, continued support of the U.S.
Air Force Air Mobility Command program, lowered costs through
process improvements, and continued customer service
initiatives. As the Company's financial performance continues to
improve, the loan would be repaid from 2005 to 2009.

"Our business suffered greatly as a result of the September 11
tragedy, and this loan guarantee will be an important validation
of our role in U.S. aviation and our ability to return to
profitability and future financial success," noted Harris. "The
cost reductions we've taken to date, combined with our business
plan for future growth, will clearly demonstrate our ability to
repay the loan. We are hopeful that our discussions with the
ATSB will be fruitful, as we continue our recovery efforts
during 2002," he concluded.

Utilizing a well-maintained fleet of international range, wide-
body aircraft, World Airways has an enviable record of safety,
reliability and customer service spanning 54 years. The Company
is a U.S. certificated air carrier providing customized
transportation services for major international passenger and
cargo carriers, the United States military and international
leisure tour operators. Recognized for its modern aircraft,
flexibility and ability to provide superior service, World
Airways meets the needs of businesses and governments around the
globe.


WORLDCOM: S&P Lowers Four Related Synthetic Deals' Junk Ratings
---------------------------------------------------------------
Standard & Poor's lowered its ratings on four synthetic
securities related to WorldCom Inc. to double-'C' from triple-
'C'-minus. At the same time, the ratings remain on CreditWatch
with negative implications, where they were placed on April 17,
2002.

The rating actions follow the downgrade of WorldCom Inc.'s long-
term corporate credit and senior unsecured debt ratings on July
1, 2002.

These synthetic securities are weak-linked to the underlying
collateral, WorldCom Inc. debt. The lowered ratings reflect the
credit quality of the underlying securities issued by WorldCom
Inc.

A copy of the WorldCom Inc.-related press release, dated July 1,
2002, can be found on RatingsDirect, Standard & Poor's Web-based
credit analysis system.

       RATINGS LOWERED AND REMAIN ON CREDITWATCH NEGATIVE

    Corporate Backed Trust Certificates, Series 2001-17 Trust
          $25.000 million corporate-backed trust certs

                      Rating
          Class     To              From
          A-1       CC/Watch Neg    CCC-/Watch Neg

                PreferredPLUS Trust Series WCM-1
       $80.703 million corporate bond-backed trust certs

                      Rating
          Class     To              From
          Certs     CC/Watch Neg    CCC-/Watch Neg


               CorTS Trust For WorldCom Notes
       $57.156 million corporate-backed trust securities


                      Rating
          Class     To              From
          Certs     CC/Watch Neg    CCC-/Watch Neg

                 SATURNS Trust No. 2001-5
     $26.023 million debenture-backed securities

                      Rating
          Class     To              From
          Units     CC/Watch Neg    CCC-/Watch Neg


WORLDCOM: Bank Lenders Formally Declare $4.25BB Loan Defaults
-------------------------------------------------------------
Clinton-Mississippi-based WorldCom Inc.'s bank lenders have
formally notified the troubled telecommunications company that
it's in default of the terms of credit facilities totaling $4.25
billion, WorldCom said yesterday, reported Dow Jones.  According
to the newswire, the company also made other disclosures Monday
that, according to some investors and analysts, worsen the
already bleak outlook for the company.

In a press release issued on July 1, WorldCom announced that the
company's accounts receivable securitization program has been
terminated; the Nasdaq Stock Market plans to delist the
company's shares on Friday, July 5, because the company failed
to comply with certain filing and fee requirements; and the
audit committee of WorldCom's board is reviewing financial
records for 1999 and 2000. Sources say the disclosures mean that
WorldCom's cash position is under severe pressure, reported Dow
Jones. (ABI World, July 2, 2002)


WORLDCOM: Stratecast Says Crisis Will Cause Market Share Shifts
---------------------------------------------------------------
Given the new opportunities that will inevitably materialize as
a result of the problems at WorldCom and Qwest, AT&T's near-term
future is anything but bleak.

"Stratecast expects material shifts in service provider market
shares of large business customers," says Michael Suby, Senior
Research Analyst, Data/Internet Services Growth Strategies
(DSGS) Analysis Services, Stratecast Partners.

"Stratecast expects that it will be exceedingly difficult for
WorldCom to continue as a going concern in its current form, and
we believe it is likely that WorldCom will be compelled to seek
bankruptcy protection with hopes of restructuring," says Mike
Smith, Co-Founder & Chief Strategist, Stratecast. "Although
Qwest faces a multitude of challenges, we believe that the
appointment of Richard Notebaert as Chairman and CEO is a
positive move, particularly based on Notebaert's preliminary
statements regarding key company priorities and focus areas,"
adds Mr. Smith.

In a new report entitled Assessing the Competitive Impact of the
Crises at WorldCom and Qwest, Stratecast Partners assesses and
forecasts the impact of the recent crises at WorldCom (the
latest of which is $3.85 billion in operating expenses
inappropriately accounted for as capital expenditures) and Qwest
(the latest of which is the resignation of Joseph Nacchio as
Chairman and CEO, the arrival of Richard Notebaert and
continuing SEC inquiries). Our emphasis in the report is on how
these recent events will result in material shifts in service
provider market shares of large business customers.
Interpretation from the perspectives of AT&T, Sprint, Cable &
Wireless, Equant, BellSouth, SBC, and Verizon is included in the
report.

Please reach Matt Kellogg for details on this report, the DSGS
Analysis Service and how to purchase either at
mkellogg@stratecast.com or 530-893-1134.

Stratecast Partners' DSGS Analysis Service has developed and
adopted an R&A model that is truly unique. The overall objective
of DSGS is to assess the data/IP growth strategies of top tier
telecom service providers and ISPs, and to analyze the next-
generation technology platforms that will enable those services.
What ultimately differentiates DSGS is the analysis of
technology supplier products and strategies. DSGS focuses on
identifying and assessing the inter-relationships involving
data/IP service providers and their technology suppliers -- at
the product, service/support and business planning levels.

Stratecast Partners, a division of Frost & Sullivan, provides
strategic analysis of the telecommunications industry with a
focus on five key areas: data/IP growth initiatives of Tier 1
service providers and vendors; application hosting strategies
and technologies; OSS; infrastructure convergence; and,
competitive service providers. Stratecast provides its clients
with continuous actionable insight via its access-and-expertise-
based strategic intelligence solution.


XO COMMUNICATIONS: Honoring Prepetition Employee Obligations
------------------------------------------------------------
Only six of XO Communications, Inc.'s approximately 5,600 full-
time and part-time employees are employed by XO Communications
and each is a Contract Employee.  These Contract Employees
comprise a significant portion of the Company's executive
leadership, including its chief executive officer, chief
operating officer, chief financial officer, general counsel, and
president of market sales.

All of the Company's other employees are employed by XO
Services, Inc., a non-debtor Operating Subsidiary.  XO Services'
Employees render services to or on behalf of the various
entities of the Company, including the Debtor.  XO Services is
responsible for and pays the compensation and expenses of the
employees (including the Contract Employees).  As for Employee
Benefits, many of the agreements run between the Debtor and the
various providers of such benefits, and cover both the XO
Services Employees and the Contract Employees.  Intercompany
transactions are recorded accordingly.

Inasmuch as XO Services is not a debtor, XO Services intends to
make payments to the XO Services Employees in the ordinary
course, uninterrupted by the filing of the XO chapter 11 case.
Any compensation or expenses paid to XO Services Employees for
services rendered to or on behalf of the Debtor will be recorded
as a prepetition or post-petition intercompany claim, as
applicable, against the Debtor.

However, with respect to those employees who are direct
employees of the Debtor by virtue of its employment agreements
with XO, such as the Contract Employees, and with respect to
Employee Benefits for all employees, including the XO Services
Employees and the Contract Employees, for whom the Debtor runs
agreements with providers of benefits, the intervening chapter
11 filing signify there are accrued unpaid prepetition
Compensation and Expenses owed to the employees and related
third-parties such as employee benefit plan administrators. This
is so because employee obligations accrue on an ongoing basis,
but are paid periodically in arrears.

"If the Company is unable to pay the outstanding Prepetition
Employee Obligations, employees of the Debtor and its non-debtor
affiliate XO Services will endure significant stress, hardship,
and suffering," Wayne M. Rehberger, the Debtor's Chief Financial
Officer, told the Court, "Such a distraction would spawn waves
of anxiety throughout the entire Company, including the
Operating Subsidiaries who have not filed for relief under the
Bankruptcy Code."

The Contract Employees retained directly by XO are central to
the operations and decisions that will determine whether the
Debtor's restructuring is a success. The Debtor believes that
paying these employees their employee-related obligations will
allow them to focus their energies toward promoting higher
levels of morale throughout the entire Company. Many employees
also rely heavily on their employee benefits, such as Health
Benefits, Mr. Rehberger continued.

Maintaining the services and loyalty of the Company's employees
will be a crucial element in forging a successful reorganization
of the Debtor. "Nevertheless, the filing of a chapter 11
petition is a stressful and uncertain time for a debtor's
employees, most of whom are unfamiliar with the nuances of
bankruptcy that practitioners occasionally take for granted,"
Tonny K. Ho, Esq., at Willkie Farr & Gallagher notes.  "Such
stress and uncertainty often harm employee morale just at that
critical juncture where a debtor needs its employees to be most
loyal," Mr. Ho says.  Any deterioration in employee morale and
welfare at this critical time undoubtedly would have a
devastating impact on the Company, the value of its assets and
businesses, and ultimately, the Debtor's ability to reorganize,
Mr. Ho remarks.

Accordingly, the Debtor asks the Court to authorize payment of
all prepetition (i) Employee Wages, Salaries and other
Compensation, (ii) Employee Medical, Dental and Similar
Benefits, and (iii) Reimbursable Employee Expenses.

"Motion granted," Judge Gonzalez rules.  Judge Gonzalez further
orders that:

-- with respect to all Contract Employees, the Debtor is
   authorized to pay Employee Compensation, Reimbursable
   Expenses, and Employee Benefits costs, including, without
   limitation, payments relating to the prepetition period, and
   to remit all Employee Deductions to the appropriate third
   parties; provided, however, that the Debtor shall not pay any
   prepetition wages to any Contract Employee in excess of
   $4,650 without providing at least five business days prior
   written notice to any official creditors' committee formed in
   this case and in the event the creditors' committee asserts a
   written objection and such objection is not consensually
   resolved then no such payment shall be made without further
   order of the Court;

-- with respect to all XO Services Employees, the Debtor is
   authorized to pay Employee Benefits costs, including, without
   limitation, payments relating to the prepetition period, and
   to remit all Employee Deductions to the appropriate third
   parties;

-- the bank at which the Company maintains its Payroll Account
   (Bank of America, Partial Account Number 0289) is authorized
   and directed to honor checks issued and presented for payment
   to the extent that sufficient funds are on deposit in such
   account, and to continue to maintain and process such account
   in the ordinary course of business, consistent with its
   prepetition practices;

-- the Plan Administrators are authorized to continue to
   administer the Debtor's plans in the ordinary course,
   consistent with its prepetition practices.

         The Debtor's Prepetition Employee Obligations

* Wages, Salaries and Other Compensation

The Contract Employees are paid on a biweekly schedule on every
other Friday. The average payroll for any two-week pay period
for the Contract Employees is approximately $83,255, including
wages and salaries, federal and state withholding taxes,
employer payroll taxes, 401(k) contributions, and other
compensation.

Based upon the Company's records, the Debtor estimates that no
one Contract Employee is owed Unpaid Compensation or other
employee obligations in an amount which exceeds the $4,650
priority established under section 507(a)(3) of the Bankruptcy
Code. To the extent that this statement is in error, the Debtor
will file a notice and schedule with the Court identifying those
employees who have received more than $4,650.

ADP, Inc., the Payroll Administrator, is party to an agreement
with XO pursuant to which ADP processes the Company's payroll
for all of the employees, including both the XO Services
Employees and the Contract Employees. ADP also withholds
portions of certain employees' wages, and disburses such funds
directly to those third parties designated by such employees or
otherwise.  The administrative cost of ADP's payroll processing
is approximately $50,000 per month. The Company believes it is
current with such payments. To the extent that a portion of any
future payment may be deemed payment of a prepetition obligation
of the Debtor owed to ADP, the Debtor is authorized to pay such
prepetition amounts to ADP pursuant to the granting of the
motion.

The Company's employees are entitled to defer up to 20% of their
annual salary (up to the applicable statutory limit) into XO's
tax deferred savings plan (the 401(k) Plan). The trustee/record-
keeper of the 401(k) Plan is T. Rowe Price Group, Inc.  To the
extent an employee elects to participate in the 401(k) Plan, as
part of the employees' compensation, the Company contributes an
amount equal to 50% of the deferred amount up to 5% of such
person's annual salary.

* Reimbursable Business Expenses

In the ordinary course of business, the Company reimburses
employees for certain business expenses incurred in the scope of
their employment. The XO Services Employees will continue to
receive their reimbursement in the ordinary course. The Debtor
estimates that, as of the Petition Date, the Contract Employees
have incurred expenses aggregating approximately $12,000,
relating to, inter alia, business travel expenses and meals, car
rentals, and a variety of miscellaneous expenses for which they
have not been reimbursed and/or for which they have not yet
applied for reimbursement. The Debtor estimates that as of the
Petition Date, no one Contract Employee is owed more than $4,500
of Reimbursable Expenses.

* Employee Benefits

Certain third-party providers (such as ADP and Aetna Inc., among
others) are party to contractual agreements with the Debtor to
provide such Employee Benefits. In sum, because the premiums for
many of the Employee Benefits plans are paid in advance, the
Debtor believes that such premiums are paid through June 30,
2002.

(i) Health Insurance Plans

An important element of the Employee Benefits is the standard
medical and dental insurance, which the Company provides to
employees through a self-insured health plan administered by
Aetna Inc. The Company's employees share the cost of the
Company's Health Benefits. Collectively, the Company's employees
contribute, via payroll deductions, approximately $530,000 in
the aggregate each month. The average monthly Health Benefits
claims paid by the Company total in the aggregate approximately
$2,000,000. The average monthly cost of the administration
(excluding payment of claims) of the Company's Health Benefits
is approximately $905,000. The Debtor believes that it is
current with respect to such payments.

Based upon information supplied by the Plan Administrator, a lag
of approximately two weeks exists between an employee's
submission of a claim and the Plan Administrator's debiting of
the Payroll Account in order to pay such claim.  These Pipeline
Claims also may include claims for reimbursement of costs of
health services incurred by an employee but not yet submitted.
The Company estimates that as of the Petition Date, the amount
of potential Pipeline Claims or otherwise unpaid Self-Insured
Claims will be approximately $1,500,000.

(ii) Workers' Compensation

The Company is compelled by law to provide workers' compensation
benefits to all of its employees.  Except for the states of Ohio
and Washington, the Company maintains a premium-based workers'
compensation insurance plan for the benefit of Company employees
with St. Paul Mercury Insurance Co.  XO Management Services,
Inc., an Affiliate of the Debtor, pays approximately $25,000 on
a quarterly basis into a state workers' compensation fund with
respect to XO Services Employees located in the state of
Washington.  Each payment covers the prior three-month period.
XO Management Services, Inc. makes two payments per year of
approximately $5,000 into a state workers' compensation fund
with respect to XO Services Employees located in the state of
Ohio.

Each payment covers the prior six-month period. The next payment
is due in August 2002. Historically, the Company's average
monthly premiums under the Workers' Compensation Plan are
approximately $134,000.

(iii) Disability Insurance

XO maintains short-term and long-term disability programs with
Hartford Life and Accident Insurance Co. The STD Program
provides both XO Services Employees and Contract Employees with
short-term income protection in the event that they become
disabled from a covered accident, sickness, or pregnancy. The
historical monthly average premium payment made to Hartford Life
under the STD Program is approximately $150,000, which is
payable in advance. The Debtor believes that no accrued and
unpaid STD Program premiums are outstanding as of the Petition
Date. The LTD Program provides employees with protection against
loss of income should they become disabled from a covered
accidental bodily injury, sickness, or pregnancy for a period in
excess of 180 days. The historical monthly average premium
payment made to Hartford Life under the LTD Program is
approximately $73,500, which is payable in advance.

(iv) Other Employee Benefits

The Debtor maintains an employee assistance program with
Ceridian LifeWorks Services for the benefit of the XO Services
Employees and the Contract Employees. Under the EAP, employees
may receive counseling for substance abuse and other issues
which may directly affect their job performance, and their
overall ability to function in society. The historical monthly
average payment made under the EAP is approximately $13,000. The
Debtor believes they are current on the premium payments.

The Debtor maintains a Group Life Insurance program with
Hartford Life for Company employees. The Group Life Program
provides for life insurance benefits, accelerated death
benefits, and accidental death and dismemberment benefits. The
historical monthly average premium payment made under the Group
Life Program is approximately $143,000, which is payable in
advance. The Debtor believes that no accrued and unpaid premiums
are outstanding as of the Petition Date.

The Debtor maintains an Eye Care Plan with Vision Service Plan.
The Eye Care Plan is bundled together with the Health Benefits,
so that all XO Services Employees and Contract Employees covered
by the Health Benefits also are covered under the Eye Care Plan.
The Eye Care Plan provides for reimbursement benefits on certain
vision-related services, such as eye-glasses, contact lenses,
and vision examinations. The historical monthly average premium
payment made under the Eye Care Plan is approximately $70,000.
The Debtor believes that no accrued and unpaid premiums are
outstanding as of the Petition Date.

The Debtor maintains several other insurance plans with St.
Paul, which also contracts with the Debtor for the Workers'
Compensation Plan. The Debtor pays monthly premiums to St. Paul
of approximately $19,000 for a general liability plan,
approximately $11,000 for the first layer of an umbrella
liability plan, and approximately $40,000 for an auto liability
plan.

The Debtor maintains a $25,000 deductible for auto liability
claims.

The Debtor estimates that prepetition obligations due to St.
Paul would not be in excess of $19,000 for the general liability
plan, $11,000 for the first layer of the umbrella liability
plan, and $40,000 for the auto liability plan. (XO Bankruptcy
News, Issue No. 2; Bankruptcy Creditors' Service, Inc., 609/392-
0900)


XO COMMS: Launches New Suite of Programs to Deliver More Choices
----------------------------------------------------------------
Continuing to simplify telecommunications purchasing decisions
for businesses, XO Communications Inc. (OTCBB: XOXO), unveiled a
suite of programs designed to offer customers XO's innovative
service, coupled with enhanced flexibility and options.

For a limited time, customers can benefit from several
promotional offers including - flexible short-term agreements,
limited waivers of early termination charges and up to six
months of free service for certain commitments. Though
limitations and restrictions apply, by offering these new
promotional plans XO continues to demonstrate its focus on the
current telecommunications environment and its commitment to
meet business customers' telecommunication needs.

"In today's turbulent telecommunications landscape, XO
Communications wants our existing and prospective customers to
know that we stand solidly behind our commitment to provide a
full range of products and services designed to serve our
customers' needs," said President and Chief Operating Officer
Nate Davis. "We continue to offer a wide array of voice and data
services that are designed to meet the demands of business
customers of all sizes, all from a company where customer
satisfaction remains our primary focus."

XO recognizes that during this current period of uncertainty
business may have more questions than usual about XO services or
about the opportunities to become an XO customer. In response,
the company has added a special 24x7 hotline (888-575-6398).
Existing customers may also call their regular XO sales or
customer care contacts.

Although the XO parent holding company, XO Communications, Inc.
is currently in the process of restructuring its debt in a
Chapter 11 bankruptcy proceeding, the service providing and
operating units of XO continue to conduct business as usual and
continue to provide XO customers with innovative broadband
solutions throughout the United Sates. XO Customers continue to
believe in and draw value from the XO promise of an integrated
telecommunications solution for their business. Because XO
offers these services in locations across the country - all on
one bill, all from one company - business customers of all sizes
are able to rely on a single communications provider for a wide
variety of voice services including local, long distance,
calling card and inbound toll free services, data services
including Internet access, virtual private networks (VPNs),
private line, Ethernet and Web hosting services. XO customers
can also benefit from the convenience of combined voice and data
services offered by our XOptions packages. XO customers also
understand the value provided by our nationwide multiple OC 192
High Speed IP broadband Backbone network optimized for both IP
and SONET services that connects to our extensive metro networks
in 63 major markets allowing us to reach over 75 percent of the
businesses in the United States.

XO continues to add new customers like Fujitsu and hopeandcare
International who understand the value and convenience of XO
services. XO believes that this value proposition has been a
significant contributing factor towards its revenue growth of
20% in the first quarter of 2002 compared to the first quarter
of 2001.

XO Communications, Inc. is a leading provider of broadband
communications services offering a complete set of
communications services, including local and long distance
voice, conferencing, internet access, Virtual Private Networking
(VPN), Ethernet, wavelength, hosting and integrated voice and
data services. XO has assembled an unrivaled set of facilities-
based, transport networks and Tier One Internet peering
relationships in the United States. XO currently offers
facilities-based broadband communications services in 63 markets
throughout the United States.


Z-TEL TECHNOLOGIES: Fails to Meet Nadaq Listing Requirements
------------------------------------------------------------
Z-Tel Technologies, Inc. (Nasdaq: ZTEL), a leading provider of
local, long distance and enhanced telecommunications services,
received notification from Nasdaq on June 28, 2002, that the
Company does not meet the requirements for continued listing on
the National Market, specifically the $3 minimum bid price
requirement.

The Company has requested a hearing before the Nasdaq Hearing
Panel to appeal staff's decision. The Company is considering
various courses of action to regain compliance, including a
reverse stock split. There can be no assurance that the Company
will prevail at the hearing, and that its common stock will not
be delisted from the Nasdaq National Market. Until the Panel
issues a decision regarding the Company's continued listing, the
Company's securities will remain listed on the National Market.

Z-Tel was founded in the wake of the Telecommunications Act of
1996. With the establishment of the Unbundled Network Element-
Platform (UNE-P), competitive telecommunications companies
became able to provide telephone service to end-users over the
incumbent local telephone providers' network. Z-Tel was formed
around UNE-P with the vision of developing technology that would
imbue the telephone with "Intelligent Dial Tone," wherein
telephone service can be personalized to meet consumers' and
businesses' diverse communications needs in an intelligent,
intuitive way.

Z-Tel offers residential and business customers value-added
bundled local and long distance phone service with proprietary
Internet-accessible calling and messaging features. Z-Tel also
makes these services available on a wholesale basis. Z-LineHOMET
is available in 38 states, representing over 70% of the nation's
total residential phone market. Z-LineBUSINESST is available in
several states across the country. For more information about Z-
Tel's innovative services or about Z-Tel, please visit the
Company's Web site at http://www.ztel.com


* Jay Alix & Associates Changes Name to AlixPartners LLC
--------------------------------------------------------
Jay Alix & Associates, the nation's leading corporate turnaround
and financial advisory consulting firm, has changed its name to
AlixPartners, LLC and converted to a limited liability company
to signal the firm's broad array of services and professionals.

"Since our founding in 1981, our professionals have established
Jay Alix & Associates as the premier turnaround and
restructuring firm," said Jay Alix, founder. "But now our
expertise is considerably broader than that. We have
successfully leveraged our turnaround methods and skills to
apply to a much wider set of corporate challenges. We are
working with companies earlier to address situations that
require more than 'business as usual' attention."

Michael Grindfors, president of AlixPartners, said, "We changed
our name to bring more awareness to the unique continuum of
services we offer -- from litigation consulting and analytical
expertise, to implementing specific changes to overcome lagging
performance, to a complete operational and financial turnaround.
Regardless of whether we are working side-by-side with the CEO
or assisting a secured lender in a debt negotiation, our brand
stands for creating better outcomes for our clients. We do that
by focusing on implementation and results."

AlixPartners' services comprise four practice areas:

     Performance Improvement -- Helping otherwise healthy
companies identify and overcome specific challenges that hinder
operating and financial performance.

     Turnaround & Restructuring -- Guiding or managing companies
through an operating or financial restructuring, including out-
of-court workouts and formal reorganizations.

     Financial Advisory Services -- Providing analysis,
litigation consulting and expert testimony, valuation for a
variety of purposes and creditor advisory services to address
commercial and legal challenges. The practice also provides
technology-centered case-management administrative and
analytical services.

     IT Turnaround Services -- Analyzing companies' information
technology infrastructures and processes, and implementing
changes to better align the IT function with business
objectives. Implementation includes outsourcing management, pre-
merger due diligence, post-merger or multiple-platform
integration and special project management.

AlixPartners, LLC, a Delaware limited liability company --
http://www.alixpartners.com-- is an internationally recognized
leader in providing hands-on, results-oriented consulting to
solve operational, financial, transactional and legal challenges
for Fortune 1000 companies. It has more than 170 professionals
in its Detroit, New York, Chicago and Dallas offices.


* O'Melveny & Myers Intends to Merge with O'Sullivan LLP
--------------------------------------------------------
International law firm O'Melveny & Myers LLP and New York-based
private equity specialist O'Sullivan LLP have entered into a
letter of intent to merge their firms.

The combination, which is subject to partnership approval, will
create one of the top global transactional and private equity
law firms, with more than 800 attorneys in major markets from
New York to Hong Kong and 206 in New York.

The two firms have complementary practice capabilities, with
O'Sullivan providing a world class private equity capability to
O'Melveny's global expertise in litigation, bankruptcy, class
actions, intellectual property and transactional work. The
combination also represents a strategic move to expand and
deepen O'Melveny's transactional and litigation footprint in the
New York market. The merger will allow the combined firm to
offer diversified practice expertise on a global basis to fund
sponsors and their portfolio companies.

John Suydam, Chairman of O'Sullivan, said, "We believe we have
found the right partners at O'Melveny to expand our private
equity and litigation strengths. O'Melveny's geographic reach
and preeminence in a variety of practice areas enables us to
continue to meet the expanding needs of our clients and provides
our attorneys with the necessary resources to expand their
practices both nationally and internationally."

O'Melveny Chairman A.B. Culvahouse said, "O'Melveny has just
completed the most successful year in its history, and we have
been in strategic conversations with a wide range of potential
partners. As I have told our clients and colleagues, the only
business combinations we would consider are those that will
enhance our client service and create more opportunities for our
attorneys. A union with O'Sullivan meets these criteria.
O'Sullivan is a leader in the private equity arena - a strategic
focus for our firm - and shares our values of professionalism,
collegiality, and uncompromising excellence."

The terms of the proposed merger contemplate that the senior
partners of O'Sullivan will have significant leadership
positions in the combined firm.

O'Sullivan is a New York law firm specializing in the
representation of private equity investors and financial
institutions in leveraged acquisitions, venture and growth
financings, public and private offerings, fund formation,
litigation and corporate restructurings.

O'Melveny & Myers maintains 13 offices around the world. The
firm's expertise spans virtually every area of legal practice,
including Mergers and Acquisitions; Capital Markets; Banking and
Finance; Entertainment and Media; Copyright, Trademark and
Internet; Patent and Technology; Trade and International Law;
Labor and Employment; Litigation; White Collar; Real Estate and
Project Development and Finance; Tax; and Bankruptcy.


* DebtTraders' Real-Time Bond Pricing
-------------------------------------

Issuer               Coupon   Maturity  Bid - Ask  Weekly change
------               ------   --------  ---------  -------------
Crown Cork & Seal     7.125%  due 2002  97.5 - 99.5      +0.5
Federal-Mogul         7.5%    due 2004  20.5 - 22.5      -1.5
Finova Group          7.5%    due 2009  34.5 - 35.5      0
Freeport-McMoran      7.5%    due 2006    90 - 92        +1
Global Crossing Hldgs 9.5%    due 2009   1.5 - 2.5       0
Globalstar            11.375% due 2004     5 - 7         -1
Lucent Technologies   6.45%   due 2029    58 - 60        -3.5
Polaroid Corporation  6.75%   due 2002     1 - 2         -1
Terra Industries      10.5%   due 2005    85 - 88        0
Westpoint Stevens     7.875%  due 2005    63 - 65        0
Xerox Corporation     8.0%    due 2027    49 - 51        +1

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 http://www.debttraders.com

                          *********

Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par.  Prices
are obtained by TCR editors from a variety of outside sources
during the prior week we think are reliable.  Those sources may
not, however, be complete or accurate.  The Monday Bond Pricing
table is compiled on the Friday prior to publication.  Prices
reported are not intended to reflect actual trades.  Prices for
actual trades are probably different.  Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy
or sell any security of any kind.  It is likely that some entity
affiliated with a TCR editor holds some position in the issuers'
public debt and equity securities about which we report.

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

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 http://www.debttraders.com/

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

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

                          *********

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

Troubled Company Reporter is a daily newsletter co-published by
Bankruptcy Creditors' Service, Inc., Trenton, NJ USA, and Beard
Group, Inc., Washington, DC USA. Yvonne L. Metzler, Bernadette
C. de Roda, Donnabel C. Salcedo, 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
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without
prior written permission of the publishers.  Information
contained herein is obtained from sources believed to be
reliable, but is not guaranteed.

The TCR subscription rate is $625 for 6 months delivered via e-
mail. Additional e-mail subscriptions for members of the same
firm for the term of the initial subscription or balance thereof
are $25 each.  For subscription information, contact Christopher
Beard at 240/629-3300.

                     *** End of Transmission ***