TCR_Public/020802.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

             Friday, August 2, 2002, Vol. 6, No. 152     

                          Headlines

ADELPHIA BUSINESS: Hanover Seeks Stay Relief to Cancel Bonds
ADELPHIA COMMS: Seeks Approval of Consent Agreement with TCI
ALASKA COMMS: S&P Places BB Credit Rating on Watch Negative
ALPHARMA INC: Downward Earnings Revision for 2002 Concerns S&P
AMNIS SYSTEMS: Auditors Express Going Concern Doubt

AVAYA: Weak Operations Spur S&P to Put Rating on Watch Negative
BETHLEHEM STEEL: Intends to Enter into Robotic Scarfing Contract
BETHLEHEM STEEL: Leroy Schecter Discloses 5.7% Equity Stake
BROADBAND WIRELESS: Oklahoma Court Confirms Reorganization Plan
CALL-NET ENTERPRISES: Net Loss Tops $62.4MM in 2nd Quarter 2002

CALYPTE BIOMEDICAL: David Mun Gavin Discloses 5.75% Equity Stake
CENTRAL EUROPEAN MEDIA: VR Distressed Reports 5.2% Equity Stake
CHILDTIME LEARNING: Annual Shareholders' Meeting on Aug. 15
COMDISCO: Henriquez et al Wants to Initiate Rule 2004 Exam Again
CONCERO INC: Expects to Commence Trading on OTCBB by Wednesday

CORNERSTONE PROPANE: Defers Bond Payments & Hires Advisors
CORNERSTONE PROPANE: Northwestern Continuing Review of Workout
COUER D'ALENE: Sets Annual Shareholders' Meeting for Sept. 17
CYBEX INT'L: Shoos-Away Arthur Andersen and Hires KPMG LLP
DADE BEHRING: Files for Chapter 11 Reorganization in Chicago, IL

DADE BEHRING: Case Summary & 30 Largest Unsecured Creditors
DYNEGY: Downgrades Lessen Aquila's Chance to Acquire Cogentrix
DYNASTY COMPONENTS: TSX Knocks Shares Off Exchange
ELAN CORP: S&P Drops Rating to B- Over Debt Maturity Concerns
ENRON CORP: Court Defines Scope & Duties of Employees' Committee

ENRON CORP: Wind Unit Wins Okay to Sell Aircraft to Bos Diaries
ENRON CORP: Holliday Fenoglio Handling Enron Center South Sale
EXIDE TECHNOLOGIES: Court Extends Removal Period Until Year-End
FOUNTAIN VIEW: Calif. Court Fixes August 30 Claims Bar Date
GENESEE: Receives Full Payment of Management Buyout Bridge Loan

GENTEK INC: S&P Drops Rating to SD Following Interest Nonpayment
GRAHAM PACKAGING: Unit Sales Increase as Total Revenues Decline
HOLLINGER INTL: S&P Assigns BB- Rating to $350MM Credit Facility
HOULIHAN'S: Panel Says Disclosure Statement Lacks Information
IGO CORP: Maintains Nasdaq Listing Pending Completion of Merger

ISTAR FINANCIAL: S&P Affirms BB+ Long-Term Counterparty Rating
KAISER ALUMINUM: LA Scrap Asks Court to Okay Reclamation Rights
LAND O'LAKES: Moody's Reviewing Ratings for Possible Downgrade
LIN HOLDINGS: S&P Revises Outlook as Financial Profile Improves
MAJESTIC INVESTOR: May Seek New Financing to Satisfy Obligations

MYRIENT INC: May 31, 2002 Balance Sheet Upside-Down by $21 Mill.
NATIONAL STEEL: Government Asks Court to Extend Claims Bar Date
NEW WORLD PASTA: S&P Ratchets Up Corporate Credit Rating to B+
ORBITAL SCIENCES: Liquidity Issues Prompt S&P to Junk Rating
OWENS CORNING: Court Okays PwC to Replace Arthur Andersen

OWOSSO CORP: Fails to Comply with Nasdaq Listing Requirements
PACER: Improved Risk Profile Spurs S&P to Raise Rating to BB-
PACIFICARE HEALTH: Posts Improved 2nd Quarter 2002 Performance
PENN TREATY: Gets Approval for Long-Term Care Sales in Florida
PETROLEUM GEO: Fitch Slashes Debt Ratings to Lower-B Level

PHYCOR INC: Emerges from Chapter 11 Bankruptcy Effective July 30
PINNACLE: Expects to Close Fortress Purchase Pact by Aug. 20
PINNACLE TOWERS: Turns to Gordian Group for Financial Advice
SOUTHEAST BANKING: Trustee Makes $23MM Distribution to Creditors
SPECIAL METALS: Bank Group Agrees to Waive Technical Default

SPEIZMAN INDUSTRIES: SouthTrust Agrees to Forbear Until Year-End
SWAN TRANSPORTATION: Exclusive Period Extended until August 17
TANDYCRAFTS: Committee Balks at Proposed Kmart Receivable Sale
THOMSON KERNAGHAN: Regulator Explains Order Against Ex-Chairman
TRICO STEEL: Gets Okay to Maintain Exclusivity Until November 18

USG CORP: PI Committee Seeks Okay to File Affidavit Under Seal
VERITAS DGC: S&P Affirms BB+ Rating Following Merger Termination
WARNACO GROUP: Has Until October 31 to Decide on Milford Lease
WASH DEPOT: Gets Authority to Pay Hopkins for its 59th Appraisal
WHEELING-PITTSBURGH: Court Okays CDGG as Debtor's Fin'l Advisors

WILLIAMS COMMS: Classification & Treatment of Claim Under Plan
WILLIAMS COS: Closes Asset Sales with Net Cash Proceeds of $1.4B
WORLDCOM INC: Wants to Continue Workers' Compensation Program
XO COMMS: Committee Seeks Approval to Hire Akin Gump as Counsel

*BOOK REVIEW: The Oil Business in Latin America: The Early Years

                          *********

ADELPHIA BUSINESS: Hanover Seeks Stay Relief to Cancel Bonds
------------------------------------------------------------
The Hanover Insurance Company asks the Court for an order
granting it relief from the automatic stay to permit
cancellation of certain Surety Bonds issued by Hanover on behalf
of the Adelphia Debtors.  These Surety Bonds support or
guarantee various aspects of Adelphia's business operations.  
Hanover wants adequate protection for the period from the filing
of these bankruptcy cases to the effective date of the
cancellation of the Surety Bonds.

According to Steven H. Rittmaster, Esq., at Torre Lentz Gamell &
Rittmaster LLP in Jericho, New York, prior to the Filing Date,
Hanover issued over 850 bonds with an aggregate penal sum in
excess of $80,000,000, on behalf of the Adelphia Debtors, which
bonds remain outstanding.  In most instances, Hanover may cancel
or terminate a bond by providing 30 or 60 days prior written
notice to the obligee.  Prior to the Filing Date, Hanover sent
cancellation notices out with respect to 185 of the Surety Bonds
with an aggregate penal sum in excess of $60,662,472.

Mr. Rittmaster states that the Surety Bonds issued by Hanover
effectively guarantee the obligations and financial requirements
imposed upon the Debtors by the obligees of the Surety Bonds
under contracts, agreements and permits entered into between the
Debtors and the Obligees.  The Surety Bonds include:

  * "performance" and "franchise" bonds which guarantee the
    Debtors' obligations to municipalities under cable franchise
    agreements,

  * "pole attachment" bonds which guarantee Debtors' use of an
    owner's poles in connection with the Debtors' furnishing of
    television cable service,

  * "contract" and "permit" bonds which guarantee the Debtors'
    contractual or permit obligations to obligees,

  * "miscellaneous" bonds which guarantee the Debtors' prompt
    payment of all obligations and charges arising under the
    underlying agreement, and

  * "games of chance" bonds, as required by the General Business
    Law of the State of New York, guaranteeing the Debtors'
    obligations in engaging in games, contests or other
    promotions or advertising plans in New York.

Mr. Rittmaster submits that the Adelphia Debtors are obligated
to indemnify and reimburse Hanover for all payments made under
the Surety Bonds issued by Hanover pursuant to a general
agreement of indemnity dated November 20, 2001.  The Adelphia
Indemnity Agreement provides, in pertinent part, that the
Adelphia Debtors agrees:

  * to indemnify Hanover from any and all losses, damages, costs
    and expenses incurred by Hanover by reason of having
    executed the Surety Bonds, including unpaid premiums, and

  * to deposit with Hanover funds sufficient to meet all of
    Hanover's liability under the Surety Bonds promptly upon
    request and before Hanover may be required to make any
    payments.

In addition to the Adelphia Indemnity Agreement, Mr. Rittmaster
contends that under common law, Adelphia and the other bond
principals are also liable to Hanover for all losses and
expenses incurred in connection with the Surety Bonds, and
Hanover is subrogated to the rights of the Obligees as against
Adelphia and the other bond principals for any obligations which
Hanover pays under the Surety Bonds.

Prior to the Filing Date, Mr. Rittmaster relates that Hanover
and representatives of Adelphia discussed terms for Hanover
continuing surety credit.  Some of the discussions contemplated
that Hanover may provide a post petition surety credit facility
to Adelphia, if the terms for extending surety credit could be
approved by a bankruptcy court.  Hanover prepared a term sheet
setting for terms for the continued extension of surety credit.
However, Adelphia never responded to the proposed Term Sheet.

On June 14, 2002, in accordance with the Adelphia Indemnity
Agreement, Mr. Rittmaster informs the Court that Hanover
demanded that Adelphia post cash collateral by June 17, 2002 to
secure Hanover from all loss, cost and expense, and advised that
if no collateral was received, Hanover would proceed to cancel
the Surety Bonds.  Having received no collateral, Hanover
commenced sending cancellation notices to the Obligees on the
Surety Bonds on June 20, 2002.

Under the present circumstances, relief from the stay is clearly
warranted.  Mr. Rittmaster points out that Hanover has informed
the Debtors of its intent not to continue surety credit unless
the Debtors agreed to Hanover's proposed Term Sheet forwarded to
the Debtors but failed to respond to Hanover regarding this
matter.  Thereafter, Hanover demanded cash collateral and
advised that it would cancel the Surety Bonds if it did not
receive collateral.  Again, the Debtors failed to respond
causing Hanover to commence canceling the Surety Bonds.

Accordingly, since no terms acceptable to Hanover have been
agreed to (or even proposed or offered by the Debtors) regarding
Hanover's extension of postpetition surety credit, Mr.
Rittmaster believes that the Court should order that the Surety
Bonds be deemed terminated as of the Filing Date with respect to
any post-petition transaction in connection with the Underlying
Agreements.  In addition, the Court should grant Hanover relief
from the automatic stay and permit it to cancel those Surety
Bonds which were not cancelled prior to the Filing Date.  For
the Surety Bonds that require written notice to the obligee
prior to cancellation, such termination should occur after the
giving of the requisite notice by Hanover.  For the Surety Bonds
that have no cancellation provision, cancellation should be
deemed effective as of the Filing Date as the Debtors cannot
assume these financial accommodations.  With regard to those
Surety Bonds for which a cancellation notice was sent by Hanover
prior to the Filing Date, the Court should confirm that Hanover
does not need relief from the automatic stay to cancel those
bonds as the last act required to terminate them occurred pre-
petition.

In addition, since the Debtors are continuing to use the Surety
Bonds to guarantee their ongoing post-petition obligations under
the Underlying Agreements and will continue to do so up to the
effective date of the cancellation of the Surety Bonds, Hanover
requests that the Debtors be compelled to provide adequate
protection to Hanover either through the posting of collateral,
the granting of alien or by providing some form of assurance of
post-petition performance by the Debtors under the Underlying
Agreements and the Surety Bonds. (Adelphia Bankruptcy News,
Issue No. 12; Bankruptcy Creditors' Service, Inc., 609/392-0900)


ADELPHIA COMMS: Seeks Approval of Consent Agreement with TCI
------------------------------------------------------------
Adelphia Communications Debtors ask Court for an order
approving:

  (1) a Consent Agreement dated June 25, 2002 among ACOM, TCI
      Adelphia Holdings LLC and TCI California Holdings LLC; and

  (2) specific amendments to partnership agreements.

The Consent Agreement and the Partnership Amendments embody a
complete resolution and settlement of various contested issues
among certain of the Debtors and the Non-Debtor Partners with
respect to the Debtors' authority to commence chapter 11
proceedings and to incur debtor-in-possession financing for
certain Partnership Debtors.

                         Century-TCI

Paul V. Shalhoub, Esq., at Willkie Farr & Gallagher, in New
York, informs the Court that Century-TCI California
Communications, L.P., a Debtor in these chapter 11 cases, was
formed by:

  (1) Debtor Century Exchange LLC, 75% owner and general partner
      of Century-TCI; and

  (2) Non-debtor TCI California, a 25% owner and limited partner
      of Century-TCI.

The Century-TCI partners are parties to an Agreement of Limited
Partnership dated December 7, 1999, under which Century Exchange
is designated as the Managing General Partner of Century-TCI.
The Century-TCI Partnership Agreement provides that the Managing
General Partner may not undertake certain specifically
enumerated actions, including:

  -- commencing any bankruptcy or insolvency proceeding,

  -- incurring indebtedness above a certain limit,

  -- selling or disposing of certain assets having a total value
     over $50,000,000, and

  -- commencing or settling certain litigation, without the
     approval of TCI California.

                         Western NY

Mr. Shalhoub relates that Western NY Cablevision, L.P., a Debtor
in these chapter 11 cases, was formed by:

  (1) two general partners:

      -- Debtor Adelphia Western NY Holdings LLC, 66.57% owner
         of Western NY; and

      -- Non-debtor TCI Adelphia, a 33.33% owner of Western NY;
         and

  (2) one limited partner, Montgomery Cablevision, Inc., a 0.1%
      owner of Western NY.

The Western NY Partnership Agreement provides that the Board of
Representatives shall not undertake certain specifically
enumerated actions, including:

  -- commencing any bankruptcy or insolvency proceeding,

  -- incurring indebtedness above a certain limit,

  -- selling or disposing of a substantial portion of the
     partnership's assets, except under certain circumstances,
     and

  -- commencing or settling any material litigation, without the
     consent of both General Partners or the unanimous consent
     in person or in writing of all members of the Board of
     Representatives.

                           Parnassos

Parnassos Communications, L.P., a Debtor in these chapter 11
cases, also has:

    (1) two general partners:

        -- Adelphia Western, a 66.67% owner of Parnassos, and
        -- TCI Adelphia, a 33.33% owner of Parnassos, and

    (2) one limited partner -- Montgomery, a 0.1% owner of
        Parnassos.

The Parnassos Partnership Agreement also contains the same
prohibitions mentioned in the Western NY Partnership Agreement.

Prior to the Petition Date, Mr. Shalhoub recounts that General
Partners and Debtors -- Century Exchange and Adelphia Western
had discussions with their corresponding Non-Debtor Partners
regarding their desire to commence voluntary chapter 11
proceedings on behalf of the Partnership Debtors in connection
with Chapter 11 petitions to be filed by numerous other direct
and indirect Adelphia subsidiaries.  The Non-Debtor Partners
would not consent to the commencement of Chapter 11 proceedings
on behalf of their respective Partnership Debtors and that they
would not consent to their respective Partnership Debtors
incurring indebtedness, including the DIP Financing -- unless
certain disputed issues among the parties concerning the
financing, operations and corporate governance of the
Partnership Debtors were resolved.

After extensive negotiations between the General Partner Debtors
and the Non-Debtor Partners, Mr. Shalhoub tells the Court that
the parties reached agreement resolving the dispute with respect
to the Non-Debtors Partners' consent to the Partnership Debtors'
Chapter 11 filings and the ability of the Partnership Debtors to
incur DIP Financing.  The terms of this agreement were
memorialized by the parties in the Consent Agreement, which
provides for the Non-Debtor Partners' consent to the
commencement of chapter 11 proceedings by the Partnership
Debtors.

                        Consent Agreement

The Consent Agreement provides that the Non-Debtor Partners'
consent was effective immediately after the satisfaction of
these two conditions:

* execution of the Partnership Amendments to the Century-TCI
  Partnership Agreement, the Western NY Partnership Agreement
  and the Parnassos Partnership Agreement; and

* extension by the Partnership Debtors of an offer of employment
  to David R. Van Valkenburg to serve as an Independent Advisor
  to each of the Partnership Debtors in accordance with certain
  criteria.

These conditions have been satisfied.

                      Partnership Amendments

The amendments to the Partnership Debtors' Partnership
Agreements consist of:

  * Retention of Independent Advisor: Addition of provisions
    requiring the retention of an Independent Advisor to the
    Partnership Debtors.

  * Authority of Independent Advisor: Addition of provisions
    setting forth the scope of authority and responsibilities of
    the Independent Advisor including review, consultation and
    recommendations with respect to:

    a. operating and capital budgets, plans and projections;

    b. operations and finances;

    c. employment decisions;

    d. operational restructurings;

    e. strategic planning;

    f. contract assumption, rejection or termination;

    g. capital expenditures;

    h. asset disposition or acquisition;

    i. business combinations;

    j. certain conflict matters involving transactions, claims
       and management issues as between Adelphia and any of its
       subsidiaries and affiliates and the Partnership Debtors;
       and

    k. any and all other decisions concerning the business,
       operations and finances of the Partnership Debtors.

  * Conflict Matters: Addition of provisions specifying certain
    additional actions which cannot be taken by the General
    Partner Debtors with respect to their associated Partnership
    Debtor without the consent of the applicable Non-Debtor
    Partner including:

    a. assumption, rejection and amendment determinations with
       respect to agreements between the Partnership Debtors and
       Adelphia or any of its subsidiaries and affiliates;

    b. investigation and pursuit or settlement of claims the
       Partnership Debtors may have against Adelphia or any of
       its subsidiaries and affiliates;

    c. addressing claims Adelphia or any of its subsidiaries and
       affiliates may assert against the Partnership Debtors,
       including cost allocations and intercompany claims; and

    d. termination or amendment of the respective management
       agreements in place at the Partnership Debtors.

  * Budgets: Addition of provisions requiring the formulation of
    new operating budgets and capital budgets in consultation
    with the Non-Debtor Partners and the Independent Advisor
    prior to November 30, 2002.

  * DIP Financing: Addition of provisions pursuant to which the
    Non-Debtor Partners acknowledge their consent and
    authorization under the applicable Partnership Agreements to
    the Partnership Debtors' incurrence of DIP Financing on the
    terms and conditions as approved on an interim basis by this
    Court on June 28, 2002.

  * Bankruptcy Court Approval: Addition of provisions requiring,
    no later than 10 days prior to the entry of a final order
    approving the DIP Financing, that the parties obtain an
    order from this Court approving the retention of the
    Independent Advisor and the enforceability and binding
    effect of the amendments to the Partnership Agreements and
    the governance provisions contained therein.

The Debtors believe that the terms of the Consent Agreement and
the Partnership Amendments are in the best interests of their
estates and creditors.

Inasmuch as the Partnership Agreements provide certain veto
rights in favor of the Non-Debtor Partners, Mr. Shalhoub says,
the dispute threatens to create a potentially protracted
deadlock within the corporate governance of the Partnership
Debtors, which would be harmful to the Debtors' ability to
operate the Partnership Debtors during the pendency of these
chapter 11 cases and to provide effectively for their
reorganization.

While the Debtors believe that their actions did not violate the
Partnership Agreements and that they would have had viable
defenses to any claims asserted by the Non-Debtor Partners, the
Debtors contend that the certainty of an express waiver of any
claim by the Non-Debtor Partners is preferable to the
uncertainty and expense of litigation. (Adelphia Bankruptcy
News, Issue No. 13; Bankruptcy Creditors' Service, Inc.,
609/392-0900)

Adelphia Communications' 9.875% bonds due 2007 (ADEL07USR2),
DebtTraders reports, are trading at 43.5. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=ADEL07USR2
for real-time bond pricing.


ALASKA COMMS: S&P Places BB Credit Rating on Watch Negative
-----------------------------------------------------------
Standard & Poor's Ratings Services placed its double-'B'
corporate credit ratings on diversified telecommunications
carrier Alaska Communications Systems Group Inc., and subsidiary
Alaska Communications Systems Holdings Inc., on CreditWatch with
negative implications due to concerns that the company may not
be able to achieve a low-4 times debt-to-EBITDA leverage ratio
in the near term.

Anchorage, Alaska-based ACS had $606 million total debt
outstanding as of June 30, 2002.

"ACS's revenue levels and profit margins have been adversely
affected by lower customer premise equipment sales, the impact
of the weak economy, delays in implementation of the State of
Alaska telecommunications services contract, and expenses
associated with new customer-related initiatives," Standard &
Poor's credit analyst Catherine Cosentino said. "Based on the
company's guidance of between $29 million and $31 million in
EBITDA in the third quarter of 2002, ACS's total debt to EBITDA
is likely to be in the mid-to-high-4x area for the full year of
2002. Current ratings had incorporated the expectation that the
company would be able to achieve a low-4x leverage level in the
near term."

Standard & Poor's said it will meet with management to review
its business plans and will assess the effects of the business,
economic, and competitive environment on the company's
prospective financial profile to resolve the CreditWatch
listing.


ALPHARMA INC: Downward Earnings Revision for 2002 Concerns S&P
--------------------------------------------------------------
Standard & Poor's placed its double-'B'-minus corporate credit
and other long-term ratings for pharmaceutical maker Alpharma
Inc., on CreditWatch with negative implications. The action is
in response to Alpharma's recent downward earnings revision for
2002.

In addition, Standard & Poor's also placed its double-'B'-minus
corporate credit and other long-term ratings on Alpharma
Operating Corp., on CreditWatch with negative implications. The
lower 2002 earnings revision reflects the increasing competition
in Alpharma's animal health sector and a production slow-down at
its Baltimore manufacturing facility. The total amount of debt
affected as of March 31, 2002 was $932 million.

"Standard & Poor's plans to meet soon with Alpharma's management
to review the company's strategy for addressing Standard &
Poor's increased credit concern, in light of the company's
disappointing operating performance," said Standard & Poor's
credit analyst Arthur Wong.

Alpharma's animal health business accounts for roughly 25% of
the company's revenues. Recent increased generic competition to
several of the company's swine products have led to lower sales
and operating margins at the franchise.

Alpharma's U.S. human generics business, accounting for roughly
20% of total revenues, excluding the F.H. Faulding & Co.,
acquisition, also had a decline in revenues, due to a product
recall in early 2002 and continued production slow-down at the
company's Baltimore plant.

The FDA is currently conducting an inspection of the Baltimore
facility, and Alpharma hopes to receive the results sometime in
August.


AMNIS SYSTEMS: Auditors Express Going Concern Doubt
---------------------------------------------------
Amnis Systems Inc., was formed on July 29, 1998.  On April 16,
2001, it merged with Optivision, Inc., an operating company, in
an exchange of common stock accounted for as an acquisition
under the  purchase method of accounting.

Amnis' products are used to create, manage and transmit
compressed high-quality digital video over broadband computer
networks in a wide range of applications.  This is often
referred to as "streaming video." Applications for its products
include, for example, interactive distance learning, corporate
training, video content distribution, video surveillance and
telemedicine. The use of compressed  digital video for these
applications reduces the network bandwidth and storage
requirements when compared to uncompressed digital video
technologies.

The Company has received a report from its independent auditors
on its financial statements for  fiscal years ended December 31,
2001 and 2000, respectively, in which its auditors have included  
explanatory paragraphs indicating that its recurring net losses,
stockholders' deficit; working  capital deficit and negative
cash flow from operations cause substantial doubt about the
Company's ability to continue as a going concern. If recurring
operating losses, stockholders' deficit, working capital deficit
and negative cash flow from operations continue, Amnis business  
could be materially adversely affected.

Amnis has generated limited revenues and incurred significant
losses.  As of December 31, 2001 and March 31, 2002, it had an
accumulated deficit of approximately $21,797,659 and
$23,905,302, respectively. For the year ended December 31, 2001
and for the first quarter ended March 31, 2002,   consolidated
net losses were $21,684,606, which includes $17,877,694 of
goodwill amortization and  impairment adjustments, and
$2,107,643, respectively.  The Company has never been profitable
and continues to incur losses from operations.  Furthermore, it
expects to incur net losses over the next two years of between
$4 million and $6 million in  total.  In fact, it may never
generate sufficient revenue, income and cash flows to support
its operations.  Its future revenues could decline by  reason of
factors beyond its control such as technological changes and
developments, downturns in the economy and decreases in demand
for digital video networking and broadband Internet products.  
If it continues to incur losses, if its revenues decline or grow
at a slower rate, or if its expenses increase without
commensurate increases in revenues, its operating results will
suffer and the  price of its common stock may decline.

The Company currently expects to reach break even in 2004. So,
in order to sustain operations until  then, it currently
estimates that it will need additional funding of between $4
million and $6 million in total. However, its capital
requirements will depend on many factors, including, for
example, acceptance of and demand for its products, the extent
to which it invests in new technology and research and
development projects, general economic conditions, and the
status and timing of competitive developments. To the extent
that its existing sources of liquidity and cash flow from  
operations are insufficient to fund its activities, it will
continue to need to raise additional  capital.

If additional funds are raised through the issuance of equity
securities, the percentage of equity ownership of its existing
stockholders will be reduced. In addition, holders of these
equity securities may have rights, preferences or privileges
senior to those of the holders of its common stock. If
additional funds are raised through the issuance of debt
securities, the Company may incur significant interest charges,
and these securities could also impose restrictions on Amnis'  
operations. If additional financing is not available when needed
on terms favorable to Amnis or at  all, it will have to curtail
its operations.


AVAYA: Weak Operations Spur S&P to Put Rating on Watch Negative
---------------------------------------------------------------
Standard & Poor's Ratings Services placed its Avaya Inc.,
double-'B'-plus corporate credit rating on CreditWatch with
negative implications. The action reflected continuing weak
operating performance and Standard & Poor's concerns about
financial flexibility stemming from ongoing cash-based special
charges and potential covenant amendments.

Avaya, based in Basking Ridge, New Jersey, is the leading
supplier of enterprise voice communications equipment. It had
$914 million of debt outstanding as of June 30, 2002.

Avaya's announcement of earnings for the June quarter indicated
the prospect of additional softening in demand among enterprise
customers for Avaya's communications products. While Standard &
Poor's has previously stated that it expects sluggish business
conditions to persist for Avaya, sequential declines in
quarterly revenues and contracting EBITDA have resulted in debt-
protection measures that are subpar for the rating level.

The company stated that EBITDA fell to $39 million for the
quarter ended June 30, 2002, from $90 million in the March
quarter. While Avaya has not indicated that it is at risk of
covenant violation, it did state that it is talking with
creditors to amend its existing covenants.

"In addition operating performance, Standard & Poor's is
concerned that additional cash-based charges, outlined in
Avaya's press release of July 26, 2002, will put further
pressure on its cash balances," said Standard & Poor's credit
analyst Joshua G. Davis.

Avaya will incur $125 million to $135 million of cash charges,
to be paid out over the next several quarters, to reduce
headcount and consolidate facilities. The company had $406
million of cash as of June 30, 2002. While Avaya currently has
availability under its revolving credit line, Standard & Poor's
is concerned that ongoing charges combined with declining cash
generation from operations might constrict the company's
financial flexibility.

Standard & Poor's will meet with Avaya's management to discuss
industry conditions as well as Avaya's operating cost structure,
cash requirements, and liquidity before reviewing the rating.


BETHLEHEM STEEL: Intends to Enter into Robotic Scarfing Contract
----------------------------------------------------------------
"An important element in the production of steel is the removal
of surface defects from slabs produced by slab casters," Jeffrey
L. Tanenbaum, Esq., at Weil, Gotshal & Manges LLP, in New York,
explains.  To remove these defects, Bethlehem Steel Corporation,
and its affiliated debtors operate a "scarfing" facility and a
grinder at their operations in Burns Harbor, Indiana.  
Currently, the Debtors' scarfing and grinding operations are
manpower-intensive, and deliver less than maximal yield
performance and lower slab quality than the robotic "scarfing
torch" their competitors have adopted.

Accordingly, the Debtors seek the Court's authority to enter
into a Robotic Slab Scarfing Agreement with Levy Indiana Slag
Company, doing business as Indiana Flame Services.

Indiana Flame will provide the robotic scarfing facility, which
includes all equipment, tools and related property.  Indiana
Flame will design, construct, install, commission and test the
operability of the Facility.  Indiana Flame will continue to own
and operate the equipment in the area.  The area in Burns
Harbor, where the facility will be constructed and operated,
will be leased to Indiana Flame.

                       The Scarfing Agreement

On July 25, 2002, the Debtors and Indiana Flame entered into an
Agreement containing these terms:

A. Term:

   The Agreement shall be for 10 years and may be extended for
   successive two-year terms unless and until terminated by
   either party upon 12 months' notice.  The Parties may
   negotiate changes in the contract fees prior to every
   extension to reflect the amortization of Indiana Flame's
   fixed assets.

B. Construction Job:

   Indiana Flame shall design, construct, install, commission,
   test and otherwise do all things necessary to provide the
   Facility.

C. Scarfing Services:

   Indiana Flame shall perform all the work and provide all
   goods and services associated with the operation of the
   Facility, including the furnishing of all materials, tools,
   equipment, labor and supervision.

D. Fees:

   The Debtors will pay $49,500 per month while the variable fee
   will be calculated as:

   -- $4.90 per ton for the first 20,000 tons of slabs scarfed;

   -- $3.33 per ton for the second 20,000 tons;

   -- $2.33 per ton for the third 20,000 tons; and

   -- $2.13 per ton for all additional tons.

   The Fixed Fee shall be counted beginning on the 91st day
   after the first prime slab is successfully scarfed, provided
   that Indiana Flame produces slabs that meet certain quality
   specifications at the rate of 65,000 tons per month.  If
   Indiana Flame produces Quality Slabs prior to the 90th day,
   it will be entitled to a bonus the parties would agree on.

   The Construction Job cost shall not exceed $1,681,350 but not
   less than $1,375,650, to be paid on a set milestone.

E. Changes to Fees:

   The Debtors shall have the right to increase or decrease the
   amount of work to be performed by Indiana with the contract
   fees adjusted accordingly.

F. Assignment:

   Indiana Flame shall not assign its rights under the Agreement
   without the prior written consent of the Debtors, unless the
   assignment is to any affiliate or subsidiary of Indiana
   Flame.  The Debtors may assign the Agreement upon written
   notice to Indiana Flame to any person purchasing Burns Harbor
   Division or to a purchaser or any joint venture for Burns
   Harbor Division.  If the buyer or joint venture expressly
   assumes all the Debtors' obligations under the Agreement,
   the Debtors shall be released from their liabilities and
   obligations under the Agreement, except for those that arose
   before the assignment.  However, if the buyer or joint
   venture does not assume all the Debtors' liabilities and
   obligations under the Agreement as of the sale or transfer,
   or the Debtors do not make reasonably suitable contractual
   arrangements to enable Indiana Flame to continue to perform
   under the Agreement, then the Debtors shall terminate the
   Agreement for convenience.

G. Indemnification:

   Indiana Flame shall indemnify, defend and save harmless the
   Debtors from and against all loss or liability for or on
   account of any injury or damages received or sustained by
   Indiana Flame or any of its subcontractors:

   -- arising from the use of any of the Debtors' utilities,
      tools, equipment, or materials as well as in respect of
      any failure of the same to be suitable for the intended
      purpose, regardless of the Debtors' negligence,

   -- by any act or omission, whether negligent or otherwise, of
      the Debtors or any of their employees, agents or invitees,
      or the condition of the Leased Premises or the Debtors'
      other property, or

   -- by any act or neglect of Indiana Flame or any of its
      subcontractors, including any breach or alleged breach of
      the Agreement.

   Indiana Flame waives any workers' compensation statutory
   immunity as it may relate to Indiana Flame's indemnity of the
   Debtors for employee injuries, death, or damages.

   The Debtors shall indemnify, defend and save harmless Indiana
   Flame from and against all loss or liability for or on
   account of any injury or damages sustained by any with regard
   to activities on or within the Leased Premises.  Certain of
   the parties' obligations to indemnify shall be limited to
   $1,000,000 for judgments and settlements in excess of defense
   costs.

H. Termination Without Default:

   If during the term of the Agreement, new technologies are
   developed that materially decrease Indiana Flame's cost of
   performance, the Debtors may give Indiana Flame notice of
   its desire to renegotiate the fees payable to the Internal
   Revenue Service.  If an agreement is not reached within two
   months, the Debtors may terminate the Agreement on one year's
   written notice.  If the Debtors change their practices so
   that Indiana Flame's cost of performance is substantially
   increased, Indiana Flame may give the Debtors notice of its
   desire to renegotiate the fees payable to Indiana Flame.  If
   an agreement is not reached within two months, Indiana Flame
   may terminate the Agreement on one year's written notice.  If
   Indiana Flame's performance is repeatedly and frequently
   unsatisfactory, the Debtors may terminate the Agreement by
   three months' prior written notice.  If all or any part of
   the Burns Harbor Division is shut down or substantially
   curtailed by the Debtors, the Debtors' obligations to
   purchase Indiana Flame's services under the Agreement may be
   reduced or the Debtors may terminate the Agreement upon three
   months' written notice.  Either party may terminate the
   Agreement for convenience at any time upon written notice.

I. Termination for Default:

   If either party defaults in its performance under the
   Agreement and the default continues for one month after
   written notice of the default, the non-defaulting party may
   terminate the Agreement upon one month's written notice.

J. Disposition of Property Upon Expiration:

   In the event of the Agreement's expiration, during the 30-day
   period prior to the expiration date, the parties shall
   negotiate the Debtors' purchase of all or any portion of
   Indiana Flame's spare parts inventory at book value, and the
   Debtors' purchase of Indiana Flame's fixed assets at the
   Facility (excluding the Robotic Scarfing Unit, which the
   Debtors shall not have the right to purchase) at fair market
   value.  After the parties have determined which property the
   Debtors will purchase, Indiana Flame will remove the
   remaining property within 180 days.

K. Disposition of Property Upon Debtors' Termination Without
   Indiana Flame Breach, or Indiana Flame Termination Upon
   Debtors' Change in Practice:

   If the Debtors terminate the Agreement in the absence of a
   breach by Indiana Flame, or if Indiana Flame terminates the
   Agreement after a change in practice by the Debtors, the
   Debtors shall have the obligation to purchase all of Indiana
   Flame's fixed assets and spare parts inventory at the
   Facility, excluding the Robotic Scarfing Unit, at a price
   equal to the higher of fair market value or book value,
   calculated on a 10-year straight line basis, so long as
   Indiana Flame permits the Debtors to continue to use the
   Robotic Scarfing Unit by paying Indiana Flame $20,000 per
   month.  Indiana Flame shall remove any additional materials
   not purchased by the Debtors within 180 days.

L. Disposition of Property Upon Termination for Convenience by
   Indiana Flame or Breach by Indiana Flame:

   In the event of Indiana Flame's termination for convenience
   or the Debtors' termination for Indiana Flame's breach, the
   Debtors shall have the right, upon 30 days written notice, to
   purchase all of Indiana Flame's fixed assets at the Facility
   (excluding the Robotic Scarfing Unit) at a price equal to
   book value calculated on a 10-year straight line basis and
   the right to purchase any of Indiana Flame's spare parts
   inventory at book value. The Debtors shall also have the
   right to continue to use the Robotic Scarfing Unit by paying
   Indiana Flame $20,000 per month.  In addition, Indiana Flame
   shall pay $900,000 to the Debtors as liquidated damages, and
   not as a penalty.  Indiana Flame shall remove any additional
   materials not purchased by the Debtors within 180 days.

M. Disposition of Property Upon Termination for Convenience by
   Debtors or Breach by Debtors:

   In the event of the Debtors' termination for convenience or
   Indiana Flame's termination for the Debtors' breach, the
   Debtors shall purchase all of Indiana Flame's fixed assets at
   the Facility (excluding the Robotic Scarfing Unit) and
   Indiana Flame's spare parts inventory at a price equal the
   greater of fair market value or book value calculated on a
   10-year straight-line basis. In addition, the Debtors shall
   pay $900,000 to Indiana Flame as liquidated damages, and not
   as a penalty. Indiana Flame shall remove any additional
   materials not purchased by the Debtors within 180 days.

N. Most Favored Customer:

   Indiana Flame warrants that the prices, provisions concerning
   cost reductions, and other terms and conditions of the
   Agreement are the most favorable offered by Indiana Flame for
   the services provided in the Agreement for similar services
   to other domestic customers.

O. Legal Compliance:

   In performing the Work, Indiana Flame shall comply and shall
   cause its subcontractors, suppliers, agents and invitees to
   comply with all applicable federal, state and local laws,
   rules, regulations, permits and Presidential Executive
   Orders.  In addition, all Work delivered under this
   Agreement shall be in compliance with all applicable federal,
   state and local laws, rules, regulations, permits and
   Presidential Executive Orders.

P. Title:

   The Debtors, at all times, will have title to, and exclusive
   Ownership of, all slabs or steel products on which Indiana
   Flame is performing work under the Agreement and of the
   Leased Premises.  Any plans and specifications developed,
   excluding plans and specifications which are proprietary,
   shall be the Debtors' sole and exclusive property.
   Indiana Flame shall maintain the Debtors' property,
   including the Leased Premises, and shall be solely
   responsible for the protection thereof.

Q. No Liens:

   Neither Indiana Flame nor any assignee, subcontractor,
   workman, material man, or other person shall file or perfect
   any lien or attachment against the Debtors' property or
   against any monies then due or to become due by the Debtors
   to Indiana Flame for any labor, services, goods, or materials
   furnished in or for the performance of the Agreement.  If any
   Lien should be filed or perfected, Indiana Flame shall
   promptly discharge, by bond or otherwise, any Lien or
   attachment and indemnify, defend, and save harmless the
   Debtors against any loss or expense in connection therewith.

R. Taxes:

   The Debtors shall pay all federal, state, and local taxes and
   other assessments that may be levied or imposed upon the
   Leased Premises. Indiana Flame shall pay all federal, state,
   and local taxes and other assessments that may be levied or
   imposed against any machinery, equipment, or supplies or
   other property of Indian Flame.

                       The Lease Agreement

The Debtors and Indiana Flame also entered into the Lease
Agreement, dated July 25, 2002, in order for Indiana Flame to
exercise its rights and performance of its obligations under the
Scarfing Agreement.  The terms are:

A. Lease:

   The Debtors will lease to Indiana Flame the Leased Premises,
   known as the Stripper Building, located in Burns Harbor,
   Indiana, for the purpose of Indiana Flame's exercise of its
   rights and performance of its obligations under the
   Agreement in connection with the construction, operation, and
   maintenance of the Facility.

B. Term:

   The term of the Lease will extend six months after the
   Expiration or termination of the Scarfing Agreement.

C. Rent:

   Indiana Flame will pay no monetary rent for the use of the
   Leased Premises.

D. Taxes:

   Indiana Flame will pay all taxes, levies, and assessments
   that become due and payable with respect to Indiana Flame's
   use of the Leased Premises and with respect to any property
   of Indiana Flame located on the Leased Premises and the
   easement lands.

E. Assignment:

   Indiana Flame will not sell, assign, or encumber the Lease
   nor sublet the Leased Premises without the Debtors' prior
   written consent.

Mr. Tanenbaum maintains that the entry into the Agreement is
warranted because the Robotic Scarfing Facility requires
significantly less manpower, reduces yield loss and provides
improved slab quality, which can be equated to an average
$2,700,000 annual return.  Moreover, Mr. Tanenbaum assures the
Court that the Agreement was negotiated in good faith by the
parties to come up with a reasonable and fair terms.  The
Agreement also contains flexible "assignment" rights in the
event Burns Harbor Division is sold or combined with a third
party. (Bethlehem Bankruptcy News, Issue No. 19; Bankruptcy
Creditors' Service, Inc., 609/392-0900)

Bethlehem Steel Corp.'s 10.375% bonds due 2003 (BS03USR1) are
trading at 9.5 cents-on-the-dollar, DebtTraders says. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=BS03USR1for  
real-time bond pricing.


BETHLEHEM STEEL: Leroy Schecter Discloses 5.7% Equity Stake
-----------------------------------------------------------
Leroy Schecter beneficially owns 7,500,000 shares of the common
stock of Bethlehem Steel Corporation, representing 5.7% of the
outstanding common stock of that Company.  500,000 of these
shares are held of record by the Leroy Schecter Foundation, a
non-profit foundation of which Mr. Schecter is a director.  Mr.
Schecter has sole power to vote or direct the vote, and sole
power to dispose or to direct the disposition of the 7,000,000
shares, and shared voting and disposition power over the 500,000
shares.

Bethlehem Steel Corporation (NYSE: BS) is the nation's second-
largest integrated steel manufacturer. The Company, on October
15, 2001, filed for Chapter 11 Reorganization in the U.S.
Bankruptcy Court for the Southern District of New York.


BROADBAND WIRELESS: Oklahoma Court Confirms Reorganization Plan
---------------------------------------------------------------
Broadband Wireless International Corporation (OTC Bulletin
Board: BBANE) has received an Order Confirming the Plan of the
Chapter 11 Reorganization from the Federal Bankruptcy Court in
Oklahoma City.  Judge Richard L. Bohanan signed the order
prepared by Kline, Kline, Elliott, Castleberry & Bryant, P.C.,
following the July 30, 2002 scheduled hearing.

BBAN President, Dr. Ron Tripp commented, "We are extremely happy
about the order confirming the business plan and look forward to
the reorganization process finalizing in the near future.  It
has been a long and tedious process and this could not have been
accomplished without the valuable guidance of our attorney Tim
Kline and the day to day efforts of the EDTV executives, Keith
McAllister, Michael Williams, Richard Weddle, and Terry Gourley.  
I know our shareholders are excited about the upcoming
opportunities through EDTV's business model and strategies, and
I am excited about contributing as a member of the new Board of
Directors.  It has been a long time coming, but it is a great
feeling to see the vision and mission of Albie Shaffer, Bill
Higgins, and I come to a successful end."

EDTV CEO Terry Gourley and BBAN President Dr. Ron Tripp
testified before the court regarding the merger acquisition
between BBAN and EDTV and closing process of the final claims in
order to successfully exit the reorganization from Chapter 11
protection in the near future.  

The "Order Confirming the Plan" is available on BBAN's corporate
Web site at http://www.bbanwireless.com


CALL-NET ENTERPRISES: Net Loss Tops $62.4MM in 2nd Quarter 2002
---------------------------------------------------------------
Call-Net Enterprises Inc., (TSE: FON, FON.B; NASDAQ OTCBB:
CNEZF) announced its financial results for the quarter ending
June 30, 2002.

"The second quarter contained a mixture of significant progress
and difficult decisions for Call-Net. On the one hand we
completed our Plan of Arrangement removing $2 billion from our
balance sheet. We also signed a new comprehensive 10-year
agreement with Sprint Communications Company L.P. These two
transactions were key to a strategic, operational and financial
fresh start at Call-Net." said Bill Linton, president and chief
executive officer of Call-Net Enterprises. "On the other hand we
had to proactively respond to a disappointing CRTC decision and
a very difficult telecom market by curtailing our growth plans
and restructuring our workforce and near term priorities."

Call-Net's net loss for the quarter was $62.4 million resulting
in a $2.62 loss per share, based on 23.8 million shares
outstanding after the 20:1 consolidation that occurred as part
of the Plan of Arrangement.

Revenue for the second quarter was $197.9 million compared to
$227.2 million for the same period in 2001 and to $201.8 million
in the previous quarter.

Lower average revenue per long distance minute for business
traffic this quarter accounted for approximately $20.0 million
of the total $29.3 million decline compared to the same period
in 2001. Consumer long distance revenue fell $9.0 million
because of a decline in the number of long distance customers.
Consumer average revenue per minute was comparable to the second
quarter of the prior year. Business data revenue declined $9.1
million primarily as a result of a number of carrier customers
being lost either to bankruptcy or migration onto their own
networks. Pricing pressure also contributed to the decline in
data revenue. Consumer data revenue fell $2.4 million primarily
because of customers switching to high-speed offerings. A 89,000
increase in active local lines since last year to over 130,000
at June 30, 2002 improved business and residential local revenue
by $3.6 million and $7.2 million, respectively, partially
offsetting the decline in long distance and data revenue.

Revenue in the second quarter was down $3.9 million or 1.9% from
the first quarter of 2002. Residential revenue increased by $0.1
million as the $2.0 million decline in long distance and data
revenue was offset by $2.1 million of additional local revenue
from an increase of 35,700 local customers in the quarter.
However, business revenue fell $4.0 million, as the $1.5 million
improvement in local revenue was more than offset by a
$3.5 million and $2.0 million decline in long distance and data
revenue, respectively. Pricing and volume both contributed to
the decline in long distance and data revenue. While the rate of
local revenue growth will be slower than previously
contemplated, Call-Net still intends to pursue local and on-net
data business with the expectation that the revenue increase
from such a strategy should modestly outpace the anticipated
revenue decline from continued pressure on long distance and
data pricing.

Before unusual items, Call-Net's loss before interest, taxes
depreciation and amortization of $9.7 million this quarter was
down $49.9 million from EBITDA of $40.2 million in the second
quarter of 2001. A decline in revenue of $29.3 million and an
8.3% lower gross margin, primarily resulting from aggressive
price competition in the long distance and data services market,
accounted for most of the decline. Operating costs also
increased by $19.1 million this quarter compared to the same
period last year. The $4.8 million royalty on the new Sprint
technology and service agreement, the costs associated with the
Company's revenue growth initiatives and higher bad debt expense
related primarily to the financial difficulties of two major
carrier customers, all contributed to the increase in operating
costs.

In the second quarter, Call-Net's EBITDA before unusual items
declined $21.6 million from the first quarter of 2002. The
majority of the decline related to $16.1 million in higher
operating costs associated primarily with the new Sprint royalty
payment, development expenses related to the local growth
initiatives and higher bad debt expense. A $5.5 million lower
gross profit on $3.9 million lower revenue and a 1.9% lower
gross profit margin accounted for a portion of the decline.

In the second quarter, as part of its plan to streamline its
operations, Call-Net recorded an unusual charge of $14.9 million
in respect of the severance costs associated with the release of
350 employees as well as the facility and lease termination
costs of downsizing or closing five offices. A further unusual
charge of $10.7 million was incurred in the second quarter as a
provision against the value of redundant assets. After these
unusual charges, Call-Net's loss before interest, taxes,
depreciation and amortization was $35.3 million.

Call-Net's operating results are expected to improve in the
second half of the year for three reasons. First, the local
services initiative, the stronger Sprint relationship and a
larger enterprise sales force are all expected to provide some
revenue growth, more than offsetting the continued erosion of
the long distance and data pricing. Second, the price-cap
decision and internal carrier cost savings initiatives are
expected to improve the gross profit margin. Third, as a result
of Call-Net's plan to further streamline its organization in the
third quarter, operating expenses should be significantly lower
than in the second quarter.

"The decisions announced on June 27th to streamline our
operations and slow the introduction of local residential
service were difficult and disappointing for the Company, its
employees and investors. It means we have had to sacrifice near
term growth for a more secure future. However, it was imperative
that we improve cash flow proactively to maintain our financial
resources in this difficult market. By acting decisively now
Call-Net will have sufficient cash to fund its adjusted business
plan," said Bill Linton. "With our recapitalization behind us,
Call-Net is better positioned than its peers to survive the
current telecom downturn. We are confident balancing our
investment program to our current cash generating capabilities
is the right decision in today's telecom market place."

Call-Net Enterprises Inc., is a leading Canadian integrated
communications solutions provider of local and long distance
voice services as well as data, networking solutions and online
services to businesses and households primarily through its
wholly-owned subsidiary Sprint Canada Inc. Call-Net,
headquartered in Toronto, owns and operates an extensive
national fibre network and has over 125 co-locations in ten
Canadian metropolitan markets. For more information, visit the
Company's Web sites at http://www.callnet.caand  
http://www.sprint.ca


CALYPTE BIOMEDICAL: David Mun Gavin Discloses 5.75% Equity Stake
----------------------------------------------------------------
David Mun Gavin beneficially owns 4,500,000 shares of the common
stock of Calypte Biomedical Corporationwith sole voting and
disposition powers over the stock held.  The holding represents   
5.75% of the outstanding common stock of Calypte Biomedical.  
Mr. Gavin is a citizen of The Netherlands, with offices in
Amsterdam.

Calypte Biomedical's urine-based HIV-1 test is touted as having
several benefits over blood tests, and has received FDA approval
for use in professional laboratories. The test is also available
in China, Indonesia, Malaysia, and South Africa. The company
would like to extend its HIV test by making it faster and
adapting it for over-the-counter sale. The firm is working on
urine- and blood-based tests for other diseases and participates
in a national HIV testing service known as Sentinel. Calypte
Biomedical also owns about 30% of Pepgen, which is developing an
interferon-based drug to treat multiple sclerosis.

As of June 30, 2002, Calypte's balance sheet shows a total
shareholders' equity deficit of about $7.5 million.


CENTRAL EUROPEAN MEDIA: VR Distressed Reports 5.2% Equity Stake
---------------------------------------------------------------
VR Distressed Assets Fund Ltd., operating from Grand Cayman in
the Cayman Islands, beneficially owns 120,500 shares of the
common stock of Central European Media Enterprises, Ltd.,
representing 5.2% of the class.  The Fund has sole power to vote
or to direct the vote of, and sole power to dispose or to direct
the disposition of, the entire 120,500 shares.

Central European Media Enterprises Ltd., is a TV broadcasting
company with leading stations located in Romania, Slovenia,
Slovakia and Ukraine. CME is traded on the Over the Counter
Bulletin Board under the ticker symbol "CETVF.OB".

The Company's December 31, 2001, balance sheet shows a total
shareholders' equity deficit of about $88 million.


CHILDTIME LEARNING: Annual Shareholders' Meeting on Aug. 15
-----------------------------------------------------------
The Annual Meeting of Shareholders of Childtime Learning
Centers, Inc., will be held at Childtime Learning Centers, Inc.,
Corporate Office, 38345 W. Ten Mile Road, Suite 100, Farmington
Hills, MI 48335, on August 15, 2002, at 10:30 a.m., Eastern
Daylight Time, to consider and act upon the following matters:

    (1) The election of two directors to serve until the 2005
        Annual Meeting of Shareholders and until their
        successors shall have been duly elected and qualified.
    
    (2) The approval of the proposed grant of options, in favor
        of JP Acquisition Fund II, L.P., JP Acquisition Fund
        III, L.P. and certain of their designees, to acquire, in
        the aggregate, up to 400,000 shares of common stock.    

    (3) Such other business as may properly come before the
        meeting.
    
Only shareholders of record at the close of business on July 16,
2002 will be entitled to vote at the meeting.

Childtime Learning Centers provides care for children from six
weeks to 12 years of age. The company offers full-time and part-
time childcare and preschool services for more than 30,000
children year-round, five days a week, at about 300 Childtime
Children's Centers in 23 states and Washington, DC. Most
facilities are in suburban areas, but about 50 are on or near
company work sites. It has closed all 10 of its Oxford Learning
Centers of America, which offered tutoring and enrichment
programs for children ages 5 to 14, and is concentrating on
improving existing Childtime Children's Centers before opening
others. Two investment firms headed by chairman George Kellner
own about 70% of the company.

Childtime's March 30, 2002 balance sheet shows that its total
current liabilities exceeded its total current assets by about
$5 million.


COMDISCO: Henriquez et al Wants to Initiate Rule 2004 Exam Again
----------------------------------------------------------------
For the second time, Manuel Henriquez and Glen Howard ask the
Court to compel Comdisco, Inc., and its affiliated debtors, to
produce certain financial documents necessary for the accurate
calculation of their claims.

Douglas J. Lipke, Esq., at Vedder, Price, Kaufman & Kammholz, in
Chicago, Illinois, notes that for almost one year already, Mr.
Henriquez and Mr. Howard have been requesting for information
and documents without any success.

"As public companies, the Debtors are required to disclose to
their shareholders and the public, financial information
relating to their operations, including that of Comdisco
Ventures," Mr. Lipke says.

Every time, the Debtors and their counsel promise to produce the
requested documents and information, but that they needed
additional time due to the fact that:

    (a) the documents and information are not readily available;
        and

    (b) they did not have the right personnel to gather the
        information.

"The limited information finally received on July 9, 2002 is no
more than superficial summaries, representing at least 10% of
the requested information, and without any back-up whatsoever,"
Mr. Lipke adds.

Despite the Debtors' alleged difficulty to provide Mr. Henriquez
and Mr. Howard with the requested documents, both were able to
piece together the five-year estimated Profits and Losses of
Comdisco Ventures, based upon the various public filings of the
Debtors.  However, Mr. Henriquez and Mr. Howard require
additional back-up information and documents to calculate and
audit the Debtors' allocations of write-offs and expenses to the
1996 and 2000 Incentive Plans.  "Prior to the Petition Date, Mr.
Henriquez and Mr. Howard received quarterly reports of the
allocations, but have received none postpetition," Mr. Lipke
reports.  To date, Mr. Henriquez and Mr. Howard have not been
provided access to any of the Debtors' documents and back-up to
the public filings.  In essence, all Mr. Henriquez and Mr.
Howard are requesting is the reconciliation and allocations
relating to the previously filed public information. (Comdisco
Bankruptcy News, Issue No. 32; Bankruptcy Creditors' Service,
Inc., 609/392-0900)   


CONCERO INC: Expects to Commence Trading on OTCBB by Wednesday
--------------------------------------------------------------
Concero Inc. (Nasdaq:CERO), a provider of interactive television
solutions, has been notified by Nasdaq that as a failure to meet
the minimum bid price and market value of public float, its
common stock will begin trading temporarily on the Nasdaq
SmallCap Market, effective as of the opening of business on
Aug. 1, 2002.

Concero has determined not to file a formal application for
listing on the Nasdaq SmallCap Market. Consequently, Concero
anticipates that its common stock will be delisted from the
Nasdaq SmallCap Market as of the end of business on Aug. 6,
2002. After delisting from the Nasdaq SmallCap Market, Concero
anticipates that its common stock will trade on the OTC Bulletin
Board (OTCBB), effective as of the opening of business on Aug.
7, 2002.

The OTCBB is a regulated quotation service that displays real-
time quotes, last-sale prices and volume information in over-
the-counter equity securities. OTCBB securities are traded by a
community of market makers that enter quotes and report trades.
Concero's ticker symbol (CERO) will remain the same and can be
viewed at http://www.otcbb.com  

Concero Inc., is a provider of interactive television solutions.
Concero provides systems integration consulting services that
enable cable operators, content providers and application
providers to deliver compelling entertainment-on-demand services
and other VOD-enabled applications and intends to provide
related software products. Our solutions create engaging and
entertaining user experiences and drive profitable, on-demand
interactive services.

Concero possesses unique delivery capabilities for supporting
interactive television solutions. In conjunction with Motorola's
Horizon and Scientific-Atlanta's CreativEdge developer programs,
Concero operates state-of-the-art integration facilities with
head-ends, set-top boxes, VOD servers, operating systems and
middleware from Motorola, Scientific-Atlanta, SeaChange,
Concurrent and other major technology providers. These assets
combined with our dedicated and experienced team of interactive
television consultants and software engineers offer customers
substantial cost savings and rapid time-to-market benefits.


CORNERSTONE PROPANE: Defers Bond Payments & Hires Advisors
----------------------------------------------------------
CornerStone Propane Partners, L.P. (NYSE: CNO), is continuing to
review its financial restructuring and strategic options.  
Consistent with this review process, CornerStone has elected to
delay making the aggregate approximate $5.6 million interest
payment on three classes of its Senior Secured Notes which is
due on July 31, 2002.  The note agreements governing these
Senior Secured Notes contain a five business day grace period
with respect to the interest payments before the failure to make
the interest payments would constitute an event of default under
the note agreements.

CornerStone is continuing conversations with Credit Suisse First
Boston, the lead lender under its working capital facility, and
NorthWestern Corporation, the guarantor under its working
capital facility, to determine whether CornerStone will be able
to satisfy the conditions to making further drawings under its
working capital facility.  NorthWestern is CornerStone's largest
unit holder, and CornerStone Propane GP, Inc., a wholly owned
subsidiary of NorthWestern, manages the operations of
CornerStone.  In order to address its immediate liquidity needs,
CornerStone has entered into a loan agreement with SYN Inc., its
special general partner, whereby SYN will loan CornerStone
$3.0 million.  SYN is owned 82.5% by NorthWestern.  
Representatives of SYN have stated their willingness to make
additional loans, on short notice, to CornerStone to address its
immediate liquidity needs on a short-term basis, assuming that
SYN is satisfied with the progress made in Cornerstone's review
of potential restructuring and strategic options and its efforts
in that regard.  CornerStone has been informed by
representatives of SYN, that SYN has cash and liquid securities
of approximately $26 million.

In order to efficiently undertake its review of restructuring
and strategic options, CornerStone has taken a number of
important actions, including:

     *  retaining Everett & Solsvig, Inc., a consulting firm
        with expertise in providing interim management resources
        to companies evaluating restructuring options;

     *  retaining Greenhill & Co., LLC, an investment banking
        firm, to advise CornerStone on possible restructuring
        alternatives and other strategic options;

     *  retaining Kirkland & Ellis to act as restructuring
        counsel;

     *  appointing Curtis G. Solsvig III and Robert S. Everett,
        each principals of E&S, as Chief Executive Officer and
        Chief Restructuring Officer, respectively; and

     *  contacting its senior lenders to discuss possible
        restructuring options and alternatives.

CornerStone has made and, subject to applicable law or other
restrictions, intends to continue to make timely payments to all
suppliers.  CornerStone remains committed to continue to service
it customers without disruption.

CornerStone Propane Partners, L.P., is a master limited
partnership.  The Partnership is one of the nation's largest
retail propane marketers, serving approximately 440,000
customers in more than 30 states.  For more information, please
visit its Web site at http://www.cornerstonepropane.com


CORNERSTONE PROPANE: Northwestern Continuing Review of Workout
--------------------------------------------------------------
NorthWestern Corporation (NYSE: NOR) said it is reviewing
CornerStone Propane Partners, L.P.'s announcement that it has
elected to delay making an interest payment on its debt and is
continuing to review financial restructuring and strategic
opportunities.  In addition, NorthWestern reaffirmed its full-
year earnings target of $2.30 to $2.55 per share from continuing
operations.

NorthWestern's strategy is to focus on its growing energy and
communications businesses.  Consistent with NorthWestern's
strategic focus, in the first quarter of 2002, NorthWestern
adopted discontinued operations accounting for CornerStone and
recorded a non-cash, after-tax charge of $40 million reflecting
the change in the company's carrying value in the partnership.

"We are focusing our efforts on NorthWestern's continuing energy
and communications businesses, which are performing well," said
Merle D. Lewis, NorthWestern's chairman and chief executive
officer.  Mr. Lewis is also chairman of the general partner of
CornerStone.  "We are confident that we will reach our
previously announced earnings targets for 2002 of $2.30 to $2.55
per share from continuing operations, and we look forward to
discussing the positive results of our businesses in our
upcoming second quarter earnings release on August 8."

Among the arrangements between NorthWestern and CornerStone
which may be adversely affected by CornerStone's pursuit of
financial restructuring and strategic opportunities are:

     * NorthWestern's guaranty of CornerStone's working capital
facility. CornerStone has drawn $17.7 million of the $50 million
facility and has $8.3 million in additional letters of credit
for propane and other purchases.

     * NorthWestern's 82.5 percent interest in SYN, Inc., a
special non-managing general partner in CornerStone, which is
reflected in assets of discontinued operations and represents
approximately $20 million of SYN's approximately $26 million in
liquid assets.  As announced by CornerStone, SYN has agreed to
lend $3 million to CornerStone to address the partnership's
liquidity needs on a short-term basis.

     * Intercompany receivables, net of reserves, owed to
NorthWestern by CornerStone of $6 million.

     * NorthWestern's letters of credit of $6.5 million for
insurance loss claims.

NorthWestern will continue to evaluate CornerStone's financial
restructuring and the impact upon creditors of the partnership,
including NorthWestern, and would expect to reflect any
resulting financial implication in the company's third quarter
2002 results.  NorthWestern will release its second quarter 2002
financial results on Thursday, Aug. 8, 2002, before the market
opens.  NorthWestern's management will also discuss those
results in a live webcast conference call with interested
investors.

The webcast conference call is scheduled for August 8, at 10
a.m. Central time.  The online replay of the call will be
available starting at 3:30 p.m. on August 8.  The live webcast
and replay of the conference call will be available via the
Internet at NorthWestern's Web site at
http://www.northwestern.com  The webcast also will be  
distributed over CCBN's Investor Distribution Network. Investors
can listen to the conference call through CCBN's investor center
at http://www.companyboardroom.comor by visiting any of the  
investor sites in CCBN's Individual Investor Network.
Institutional investors can access the call via CCBN's password
protected management site, StreetEvents at
http://www.streetevents.com  

An audio replay of the call will be available from 3:30 p.m.
Central time on Aug. 8 until 11:59 p.m. Central time on Sept. 8,
2002.  To access the replay, dial 1-800-475-6701, access code
645384.

NorthWestern Corporation, a FORTUNE 500 company, is a leading
provider of services and solutions to more than 2 million
customers across America in the energy and communications
sectors.  NorthWestern's partner businesses include NorthWestern
Energy, a provider of electricity, natural gas and related
services to customers in Montana, South Dakota and Nebraska;
Expanets, a leading provider of networked communications
solutions and services in the United States; and Blue Dot, a
leading provider of air conditioning, heating, plumbing and
related services.


COUER D'ALENE: Sets Annual Shareholders' Meeting for Sept. 17
-------------------------------------------------------------
Couer d'Alene Mines Annual Meeting of Shareholders will be held
at The Coeur d'Alene Resort and Conference Center, Second Street
and Front Avenue, Coeur d'Alene, Idaho, on Tuesday, September
17, 2002, at 9:00 A.M., local time, for the following purposes:

     1. To elect a Board of Directors consisting of 10 persons
to serve for the ensuing year or until their respective
successors are duly elected and qualified;

     2. To approve an amendment of the Restated and Amended
Articles of Incorporation authorizing an increase in the number
of authorized shares of common stock from 125 million to 250
million shares;

     3. To amend the Executive Compensation Program to authorize
the reservation of an additional 1,000,000 shares of common
stock for issuance under the program;

     4. To amend the Non-Employee Directors' Stock Option Plan
to authorize the reservation of an additional 500,000 shares of
common stock for issuance under options to be granted under the
plan; and

     5. To transact such other business as properly may come
before the meeting.

Only shareholders of record at the close of business on Tuesday,
July 30, 2002, the record date fixed by the Board of Directors,
are entitled to notice of, and to vote at, the Annual Meeting.

Coeur d'Alene Mines Corporation is a leading international low-
cost primary silver producer, as well as a significant producer
of gold. The Company has mining interests in Nevada, Idaho,
Alaska, Chile, and Bolivia.

On July 22, 2002, Coeur d'Alene Mines Corporation advised the
firm of Arthur Andersen LLP that Arthur Andersen LLP would no
longer serve as the Company's independent accounting firm.
Arthur Andersen LLP had served in that capacity since October
1999. The Company's determination reflected the fact that on
June 15, 2002, the Securities and Exchange Commission announced
that Arthur Andersen LLP had informed the Commission that it
will cease practicing before the Commission by August 31, 2002.

Arthur Andersen's report dated February 15, 2002, stated that
the financial statements included in the Company's Annual Report
on Form 10-K for the year ended December 31, 2001, had been
prepared assuming that the Company will continue as a going
concern.


CYBEX INT'L: Shoos-Away Arthur Andersen and Hires KPMG LLP
----------------------------------------------------------
Karen Slein has resigned as Cybex International, Inc.'s Sr. Vice
President of Administration. This position has been eliminated
and the Company has re-distributed her responsibilities to other
officers.

Also, on July 22, 2002, Cybex International, Inc., upon the
recommendation and approval of its Audit Committee, dismissed
Arthur Andersen LLP as principal independent public accountants
for the Company and engaged KPMG LLP as the Company's principal
independent public accountants.

The Company has attempted to obtain a letter of accord from
Andersen but while the Company has received no information from
Andersen that Andersen has a basis for disagreement with Company
statements, the Company has been unable to obtain such a letter
due to the fact that the personnel primarily responsible for the
Company's account (including the engagement partner and manager)
have left Andersen.

Cybex International, Inc. is a leading manufacturer of premium
exercise equipment for consumer and commercial use.

At March 31, 2002, Cybex recorded a working capital deficit of
about $2.6 million.


DADE BEHRING: Files for Chapter 11 Reorganization in Chicago, IL
----------------------------------------------------------------
Dade Behring announced that it has reached a debt-to-equity swap
agreement with its banks, bondholders, and owners that will
eliminate approximately half of the company's debt and provide
its creditors with equity in the company. That agreement was
implemented Thursday through a voluntary, pre-packaged Chapter
11 filing, which will allow the company to continue operating
its business seamlessly and serve its customers while
implementing its debt for equity exchange in an orderly manner.
The company said it is taking this action to free up its strong
underlying operations for increased growth momentum and long-
term financial health.

"We believe this is the best possible move for the company's
future," said President and CEO Jim Reid-Anderson. "Dade Behring
has been performing consistently throughout 2001 and the first
half of 2002, with excellent year-over-year sales growth and
significant improvements in market share, profitability and
cashflow. This debt restructuring dramatically enhances our
capital structure by significantly reducing debt. We fully
intend to make the process transparent to our customers,
employees, and suppliers; in fact, we intend to pay our
suppliers and service our customers as if the case had not been
filed. Filing Chapter 11 helps to ensure that our business
continues without any kind of interruption. For Dade Behring,
this period will be business as usual, and we will emerge even
stronger than before."

The company emphasized that this pre-packaged Chapter 11 filing
will not impact day-to-day operations or affect its employees
and customers. In addition, the company's international legal
entities will not be impacted by the filing. First-day motions
have been filed to ensure that employee pay and benefits are
fully protected and suppliers will be paid in the ongoing course
of business.

In addition, the company has arranged for debtor-in-possession
(DIP) financing, with an initial commitment of $95 million, from
a syndicate led by Deutsche Bank. "The court's approval of our
$95 million in DIP financing, along with significant cash
reserves, provide additional reassurance to employees, customers
and suppliers that we can meet all of our ongoing commitments
with absolutely no interruption," said Reid-Anderson. The
company expects to emerge from the filing prior to the end of
October 2002, with publicly tradable stock.

"[Thurs]day's filing was made after a comprehensive and thorough
review of all of our options and with the full support of our
bankers, bondholders and owners," Reid-Anderson continued. "All
of the parties involved agree that this is a valuable business
with tremendous long-term prospects, which clearly should be
protected."

Prior to its filing, the company had received written
commitments from a majority of its banks and bondholders in
support of its proposed debt restructuring. Mark Cohen, head of
restructuring, from Deutsche Bank, the lead bank throughout the
debt restructuring negotiations, stated, "We fully support
management and believe that, freed of a significant amount of
its debt, this business will be well positioned for the future."

"Now that we have reached what we feel is the right solution for
our company," said Reid-Anderson, "we expect to emerge quickly
and cleanly, with an improved balance sheet and greater
operating flexibility. By reducing debt, we are able to invest
in additional customer oriented initiatives. We have
significantly increased our investments in new products and
customer support, and we are targeting further investments for
the future. R&D spending has increased by 13% to 9% of sales in
2002 and is targeted to increase to 10% of sales in 2003. I am
grateful for the steadfast support of our employees and the
loyalty of our customers and suppliers throughout the entire
negotiation process and am confident in this company's future."

With 2001 revenues of $1.2 billion, Dade Behring is among the
largest clinical diagnostics companies in the world, making it
today's best resource by offering a wide range of products and
systems for diagnostics testing. The company's products are used
in clinical chemistry, immunochemistry, cardiac diagnostics,
microbiology, plasma-protein testing, infectious-disease
testing, therapeutic-drug monitoring and drugs-of-abuse testing,
as well as hemostasis. Headquartered in Deerfield, Ill., the
company has operations in 43 countries. Additional company
information can be found on the Internet at
http://www.dadebehring.com

                         *    *    *

Dade Behring has made a strategic business decision that will
provide significant long-term benefits to its business and
customers.

Jim Reid-Anderson, President and CEO, stated, "As we have
communicated through press releases and other channels over the
past year, our operating business is very healthy, with six
successive quarters of impressive growth and profitability. At
the same time, we have carried a debt level that is simply too
high for the future health of the business and have been working
constructively and aggressively with our bankers, bondholders
and owners to restructure that debt.

"I am pleased to inform you that we have reached an agreement on
the debt restructuring, which will involve a debt-to-equity swap
that reduces our debt load significantly. To implement that
agreement in the most orderly and efficient manner possible, we
have made the strategic decision to file for a pre-packaged
Chapter 11 in the United States. That filing occurred Thursday,
August 1, in the United States. For us, Chapter 11 will be a
very quick process, lasting approximately two months. We believe
that this is the best choice for us, one that will protect our
employees and allow us to continue serving our customers with
superior products and service, while significantly reducing our
debt load. Dade Behring will emerge from this restructuring
stronger and more profitable than ever before.

The Company has developed a special section of the company Web
site -- http://www.dadebehring.com-- to provide interested  
parties with timely information throughout the restructuring
process. There is customized information for customers,
employees, suppliers and the media, as well as general
information about the pre-packaged Chapter 11 process, terms
associated with Chapter 11 and court documents. The Company will
be updating this information frequently.


DADE BEHRING: Case Summary & 30 Largest Unsecured Creditors
-----------------------------------------------------------
Lead Debtor: Dade Behring Holdings Inc.
             1717 Deerfield Road
             PO Box 778
             Deerfield, Illinois 60015

Bankruptcy Case No.: 02-29020

Debtor affiliates filing separate chapter 11 petitions:

     Entity                                     Case No.
     ------                                     --------
     Dade Behring Inc.                          02-29021
     Dade Microscan Inc.                        02-29022
     Dade Finance Inc.                          02-29023
     Syva Diagnostics Holding Company           02-29024
     Syva Company                               02-29026
     Syva Childcare Inc.                        02-29025
     Chimera Reasearch and Chemical, Inc.       02-29027     

Type of Business: The Debtors comprise the sixth largest
                  manufacturer and distributor of in vitro
                  diagnostic (IVD) products in the world. The
                  Debtors primarily sell diagnostic systems that
                  include instruments, reagents, consumables,
                  service and date management systems. As of May
                  31, 2002, Dade and DBI had approximately $1.6
                  billion in debt outstanding. Of the total
                  estimated $20 billion annual global IVD
                  market, the Debtors serve a $12 billion
                  segment targeted primarily at clinical
                  laboratories.
     
Chapter 11 Petition Date: August 1, 2002

Court: Northern District of Illinois

Judge: Bruce W. Black

Debtors' Counsel: James Sprayregen, Esq.
                  Kirkland & Ellis
                  200 East Randolph Street
                  Chicago, Illinois 60601
                  312-861-2000

Estimated Assets: More than $100 Million

Estimated Debts: More than $100 Million

Debtors' 30 Largest Unsecured Creditors:

Entity                     Nature of Claim        Claim Amount
------                     ---------------        ------------
Bear Stearns               11-1/8% Senior         $119,386,000
Proxy Dept.                Subordinated Notes     plus interest
One Metrotech Center North
4th Floor
Brooklyn, NY 11201
Attn: Lilian Mosely
Tel: (347) 643-2303
Fax: (347) 643-4625

Angelo Gordon & Co., LP    11-1/8% Senior          $65,810,000   
Brad Patelli               Subordinated Notes     plus interest
245 Park Avenue
26th Floor
New York, NY 10167-0034
Tel: (212) 692-2018
Fax: (212) 867-1388

Scoggin Capital Mgmt. LP   11-1/8% Senior          $32,000,000
Attn: Dev Chodry           Subordinated Notes     plus interest
660 Madison Avenue
29th Floor
New York, NY 10021
Tel: (212) 754-6026
Fax: (212) 355-7479

Gracie Capital, LP         11-1/8% Senior          $25,525,000
Ned Grier                  Subordinated Notes     plus interest
527 Madison Avenue
11th Floor
New York, NY 10022-4304
Tel: (212) 319-7894
Fax: (212) 888-9576

Seneca Capital             11-1/8% Senior          $25,015,000  
Alex Shingler              Subordinated Notes     plus interest
527 Madison Avenue
11th Floor
New York, NY 10022-4304
Tel: (212) 371-1300
Fax: (212) 758-6060


Deutsche Investment        11-1/8% Senior          $19,280,000
Management Americas,      Subordinated Notes     plus interest
Inc.
Alex Shingler
Tel: (212) 371-1300
Fax: (212) 758-6060

York I Capital Investment  11-1/8% Senior          $15,845,000
Limited                   Subordinated Notes     plus interest
Alan Coben  
350 Park Avenue
4th Floor
Tel: (212) 651-0514
Fax: (212) 651-0501

P. Schoenfeld Asset        11-1/8% Senior         $10,000,000  
Management                Subordinated Notes    plus interest
Douglas Polley
1330 6th Avenue, 34th Floor
New York, NY 10019
Tel: (212) 649-9507
Fax: (212) 262-0481

Oaktree Capital            11-1/8% Senior           $6,510,000
Management, LLC           Subordinated Notes     plus interest
Tim Andrews
333 South Grand Avenue,
28th Floor
Los Angeles, CA 90071
Tel: (213) 821-2782
Fax: (213) 830-6490

UBS O'Connor LLC           11-1/8% Senior           $5,000,000
Geoffrey A. Oltmans        Subordinated Notes     plus interest
299 Park Avenue
New York, NY 10014
Tel: (212) 821-2782
Fax: (212) 821-6534

PARA Advisors Inc.         11-1/8% Senior           $4,650,000
Ronald Ray                 Subordinated Notes     plus interest
520 Madison Avenue
8th Floor
New York, NY 10022
Tel: (212) 527-7341
Fax: (212) 888-5679

Harch Capital              11-1/8% Senior           $4,500,000
Management, Inc.          Subordinated Notes     plus interest
Michael Lewitt       
Boca Raton, FL 33487-8246
Tel: (561) 995-4900
Fax: (561) 995-4949

EOS Partners, LP           11-1/8% Senior           $2,905,290
Steven Friedman            Subordinated Notes     plus interest
320 Park Avenue
22nd Floor
New York, NY 10022-6815
Tel: (212) 832-5804
Fax: (212) 832-5815

Metropolital Capital       11-1/8% Senior           $2,325,000
Advisors Intl. Limited    Subordinated Notes     plus interest
Scott Cohen          
660 Madison Avenue
20th Floor
New York, NY 10021
Tel: (212) 486-8100
Fax: (212) 355-7480

Sysmex Corporation        Trade Debt                $2,276,899
Kazuya Obe           
1-5-1 Wakinohama-Kaigandori,
Chuo-ku
Kobe 651-0073 Japan
Tel: 81-78-265-0522
Fax: 81-78-265-0530

First Union                11-1/8% Senior           $2,000,000
Tim Dowling                Subordinated Notes     plus interest
301 S. College Street
Charlotte, NC 28288
Tel: (800) 528-4580
Fax: (704) 383-1401

Caywood -Scholl Capital    11-1/8% Senior           $1,250,000
Thomas Seake               Subrdinated Notes      plus interest
4350 Executive Drive - 125
San Diego, CA 92121-2110
Tel: (858) 452-3811
Fax: (858) 535-9068

Jefferson-Pilot Life       11-1/8% Senior           $1,000,000
Insurance Company         Subordinated Notes     plus interest
Hardee Mills
100 North Greene Street
17th Floor
Greensboro, NC 27401-2507
Tel: (336) 691-3384
Fax: (336) 691-3025

RH Capital Associates      11-1/8% Senior              $813,000
55 Harristown Road         Subordinated Notes     plus interest
Glen Rock, NJ 07452-3303
Attn: John Barr
Tel: (201) 444-2850
Fax: (201) 444-6020

Diagnostic Products Corp.  Trade Debt                 $608,106
Michael Ziering
5700 West 96th Street
Los Angeles, CA 90045-5594
Tel: 310-645-8200
Fax: 310-645-9999

Genzyme Diagnostics       Trade Debt                  $478,460
Don Pogorzelski    
One Kendall Square
Cambridge, MA 02139-1562
Tel: (617) 252-7750
Fax: (617) 252-7759

Electronic Instrumentation  Trade Debt                $297,539  
and Technology
Ron Ulle
108 Carpenter Drive
Stering, VA 20164
Tel: (703) 478-0700
Fax: (703) 478-0291

3M                         Trade Debt                 $287,832
Ben Hapke
3M Center  
Building 275-5W-05
St. Paul, MN 55144
Tel: 612-733-8455
Fax: 612-737-1994

Bit Analytical             Trade Debt                 $262,862
Instruments GmbH
Att: Ruediger Simonek
Am Kromberger Hang 3
Schwalbach 65825
Germany
Tel: 011-49-6196-806-101
Fax: 011-49-6196-806-111

Travelers Insurance        Insurance Vendor           $233,553
Company

Software Spectrum          Trade Debt                 $192,410

Calzyme Laboratories       Trade debt                 $179,694
Corp.

Nova Biomedical Corp.      Trade Debt                 $164,298

Piedmont Plastics Inc.     Trade Debt                 $159,103


DYNEGY: Downgrades Lessen Aquila's Chance to Acquire Cogentrix
--------------------------------------------------------------
Aquila, Inc., (NYSE:ILA) announced that recent downgrades of
Dynegy's credit ratings, together with other adverse
circumstances and events, have decreased the likelihood that
Aquila's acquisition of privately held Cogentrix Energy can be
completed as planned.

The pending transaction includes a purchase price of $415
million and the assumption of recourse and non-recourse debt.

Dynegy's downgrades by Standard & Poor's, Fitch Ratings and
Moody's Investors Service are expected to cause a Dynegy
subsidiary to default under a sizeable agreement to purchase
power from a Cogentrix subsidiary, calling into question the
Aquila-Cogentrix agreement. Aquila signed a definitive agreement
on April 29 to purchase 15 Cogentrix combined-cycle power plants
in service or under construction.

Based in Kansas City, Missouri, Aquila operates electricity and
natural gas distribution networks serving more than six million
customers in seven states and in Canada, the United Kingdom, New
Zealand and Australia. The company also owns and operates power
generation and mid-stream natural gas assets. At March 31, 2002,
Aquila had total assets of $12.3 billion. More information is
available at http://www.aquila.com


DYNASTY COMPONENTS: TSX Knocks Shares Off Exchange
--------------------------------------------------
The common shares of Dynasty Components Inc., are suspended from
trading effective immediately, for failure to meet the continued
listing requirements of TSX.


ELAN CORP: S&P Drops Rating to B- Over Debt Maturity Concerns
-------------------------------------------------------------
Standard & Poor's lowered its corporate credit rating on Elan
Corp., PLC to single-'B'-minus from double-'B'-minus, and all of
its other ratings on the specialty pharmaceutical company and
its affiliates. The ratings are removed from CreditWatch, where
they were placed on July 2, 2002, with negative implications.
The actions are due to Standard & Poor's increased concern over
Elan's ability to meet obligations as they come due.

The low speculative-grade rating on Dublin, Ireland-based Elan
reflects the company's declining pharmaceutical sales prospects,
significant upcoming debt maturities and other funding needs,
and the uncertain value of its investment portfolio, mitigated
somewhat by its still substantial cash position. The outlook is
negative.

"Elan is currently restructuring its operations, as it looks to
refocus on neurology, pain, and autoimmune therapeutic areas,
reduce its pharmaceutical sales force, and divest assets,
including select drugs from its portfolio," said Standard &
Poor's credit analyst Arthur Young.

Elan's pharmaceutical business has suffered various setbacks in
the past year, including slower-than-expected sales growth of
its newer products and the earlier-than-expected generic
competition now facing Zanaflex. Zanaflex, which generated $160
million in 2001, was one of the largest and faster growing
products in Elan's portfolio.

As the company transitions to a smaller operating base, it will
be challenged to produce break-even cash flows from continuing
operations, excluding cash restructuring charges.

As part of its restructuring, Elan hopes to raise $1.5 billion
from asset sales by the end of 2003. The timely receipt of
proceeds from asset divestitures is essential to the current
rating.


ENRON CORP: Court Defines Scope & Duties of Employees' Committee
----------------------------------------------------------------
Based on a proposal from the United States Trustee, counsel for
Enron Corporation and its debtor-affiliates -- Weil Gotshal &
Manges, counsel for the Creditors' Committee -- Milbank, Tweed,
Hadley & McCloy, and counsel to the Employment-Related Issues
Committee -- Kronish Lieb Weiner & Hellman, Judge Gonzales rules
that the Employment-Related Issues Committee has the duties and
responsibilities to:

    (a) Investigate, monitor and assist in the global resolution
        of prepetition unsecured claims held by the Debtors'
        current or former employees, either as a whole or a
        significant portion thereof, and arising from defined
        benefit or defined contribution plans, retiree benefit
        plans not covered under Section 1114 of the Bankruptcy
        Code, deferred compensation plans, ERISA and other
        employment related agreements, but excluding any claims
        as to which the holders' interests therein fall within
        the enumerated responsibilities of State Street Bank and
        Trust under the order dated April 19, 2002; provided,
        however, that the duties and responsibilities shall
        neither permit nor include the defense of any objection
        interposed to the allowance of Employment-Related
        Claims;

    (b) Investigate, monitor and otherwise assist in the
        resolution of claims for severance pay asserted by the
        Debtors' former employees, which are currently the
        subject of a joint settlement motion pending before the
        Court;

    (c) Investigate and, if appropriate, prosecute on behalf of
        the Debtors' estates avoidance actions against former
        Enron employees who received certain "90-day"
        prepetition retention bonuses, as more fully described
        in the Severance Settlement;

    (d) Communicate with holders of Employment-Related Claims
        regarding the progress of the Debtors' Chapter 11 cases
        generally and any specific issues or motions affecting
        the treatment of Employment-Related Claims, as distinct
        from prepetition general unsecured claims; and

    (e) Participate in the formulation of any plan of
        liquidation or reorganization for any of the Debtors
        solely to the extent of:

        (i) reviewing and negotiating the classification of
            Employment-Related Claims in the plan;

       (ii) reviewing whether a plan which separately
            classifies Employment-Related Claims or any portion
            thereof discriminates unfairly or is fair and
            equitable with respect to the particular class; and

      (iii) advising holders of Employment-Related Claims of
            the Employment-Related Issues Committee's
            determination as to the plan.

Furthermore, Judge Gonzalez adds, the Employment-Related
Issues Committee may file responses or objections or otherwise
participate as a party-in-interest on any matter uniquely
affecting the treatment of Employment-Related Issues and related
issues, as distinct from prepetition general unsecured claims
and related issues.  In the event the Employment-Related Issues
Committee seeks to engage in any activity beyond the scope
approved by the Court, the Employment-Related Issues will be
required to obtain approval of the expanded duties and
responsibilities by order of the Court, upon notice to the
Debtors, the Creditors' Committee and the US Trustee. (Enron
Bankruptcy News, Issue No. 38; Bankruptcy Creditors' Service,
Inc., 609/392-0900)

Enron Corp.'s 9.125% bonds due 2003 (ENRN03USR1), DebtTraders
reports, are trading at 11.5 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=ENRN03USR1
for real-time bond pricing.


ENRON CORP: Wind Unit Wins Okay to Sell Aircraft to Bos Diaries
---------------------------------------------------------------
Enron Wind Systems LLC obtained Court approval to sell to
Bos Dairies its eight-seater 1985 Cessna Citation SII (serial #
S550-0082) Aircraft and related property including:

    (a) the airframe;

    (b) engines bearing manufacturer's serial numbers 1002246
        and 1002259;

    (c) all records, logs, manuals, technical data, maintenance
        records and other materials and documents, which relate
        to the operation of the Aircraft, and:

           (i) are required to be maintained by the Federal
               Aviation Administration (or other applicable
               Governmental Authority, if the Aircraft is
               registered outside the United States), or

          (ii) are in the possession of Enron Wind at closing or
               from time to time thereafter; and

    (d) all appliances, parts, instruments, appurtenances,
        accessories, furnishings and other equipment of whatever
        nature, other than complete engines, which are from time
        to time incorporated or installed in or attached to the
        Airframe or any Engines.

Among the principal terms and conditions of the Purchase
Agreement are:

Purchase Price: $1,700,000, subject to adjustments;

Deposit Escrow: $50,000 to be deposited in trust with Aero
                 Records and Title Company;

Closing Date
Payments:       At the Closing, Bos Dairies shall:

                (1) pay and deliver to Enron Wind the Purchase
                    Price less the Deposit, and

                (2) instruct the Escrow Agent to deliver the
                    Deposit to Enron Wind;

Closing:        Five business days after satisfaction or waiver
                of the conditions to closing; (Enron Bankruptcy
                News, Issue No. 38; Bankruptcy Creditors'
                Service, Inc., 609/392-0900)


ENRON CORP: Holliday Fenoglio Handling Enron Center South Sale
--------------------------------------------------------------
Holliday Fenoglio Fowler, L.P., has been retained as agent in
the sale of Enron Center South, a newly constructed downtown
Houston office building containing approximately 1,156,636
rentable square feet of office space and trading floors. Also
included in the offering is an adjacent 1,300-car parking garage
and an entire block of downtown land, a portion of which houses
Enron's childcare center, encompassing 62,500 square feet.

The world-renowned firm of Cesar Pelli & Associates designed the
office tower and Hines Interests L.P., served as project
development manager for the base building construction. The
building boasts one of the most state-of-the-art trading
facilities in the world, including four 53,500-square-foot
trading floors and two data center floors. At this time, the
building's sole tenant is UBS AG, which occupies approximately
143,467 square feet of space. UBS purchased Enron's energy
trading operations earlier this year.

Over the next six weeks qualified interested parties may request
written material describing the building's physical components,
schedule tours of the property and review all due diligence
materials on site. Qualified bidders will then be invited to
attend a closed auction in New York in late September, where a
final purchaser will be selected for approval by the bankruptcy
court.

The sale is expected to close within several days of the auction
itself. Mark Gibson, Executive Managing Director in Holliday
Fenoglio's Dallas office and Jim Savage, Senior Managing
Director and Jeff Hollinden, Senior Director in the firm's
Houston office are leading the team that will market the
property.

With nineteen offices, Holliday Fenoglio Fowler is the country's
largest capital intermediary for commercial real estate. 2001
was a record-breaking year for the firm, with more than $12.2
billion in business volume. Since 1998, the national firm's
debt, equity/structured finance and investment sales
transactions have totaled more than $51.5 billion.


EXIDE TECHNOLOGIES: Court Extends Removal Period Until Year-End
---------------------------------------------------------------
Exide Technologies and its debtor-affiliates sought and obtained
a Court order extending the time to transfer prepetition
lawsuits pending against their Estates in to the District of
Delaware for continued litigation and resolution.  This
extension gives the Debtors the continued option of deciding
which court should resolve a prepetition lawsuit.  The Debtors
secured an extension through and including December 31, 2002.

Kathleen Marshall DePhillips, Esq., at Pachulski Stang Ziehl
Young & Jones P.C., in Wilmington, Delaware, informs the Court
that the Debtors have been evaluating those actions to determine
which actions might be suitable for removal.  "This process is
still continuing," Ms. DePhillips says.

Ms. DePhillips assures the Court that the rights of the Debtors'
adversaries will not be prejudiced by the extension.  Any party
to a prepetition action that is removed may seek to have it
remanded to the State Court from which the action was removed
pursuant to 28 U.S.C. Section 1452(b). (Exide Bankruptcy News,
Issue No. 8; Bankruptcy Creditors' Service, Inc., 609/392-0900)

Exide Technologies' 10% bonds due 2005 (EXDT05USR1), DebtTraders
says, are trading at around 15. For real-time bond pricing, see
http://www.debttraders.com/price.cfm?dt_sec_ticker=EXDT05USR1


FOUNTAIN VIEW: Calif. Court Fixes August 30 Claims Bar Date
-----------------------------------------------------------
The U.S. Bankruptcy Court for the Central District of
California, Los Angeles Division, establishes 5:00 p.m., Pacific
Time, on August 30, 2002 as the deadline for Creditors of
Fountain View, Inc., and its debtor-affiliates, to file proofs
of claims against the estates or be forever barred from
asserting that claim.  

Proofs of claims, to be deemed timely-filed, must be received by  
mail addressed to:

      Claims Agent: Fountain View, Inc.
      c/o Robert L. Berger & Associates, LLC
      10351 Santa Monica Blvd., Suite 101A
      PMB 1021
      Los Angeles, California 90025

or filed in person, by personal service or Federal Express
addressed to:

      Claims Agent: Fountain View, Inc.
      Robert L. Berger & Associates, LLC
      Attn: Robert L Berger
      16501 Ventura Blvd., Suite 440
      Encino, California 91436-2068

Separate proofs of claim are to be used for claims against
individual debtor-entities.

Proofs of Claim must be filed if:

      a. your claim has not been listed by any of the Debtors in
         their respective Schedules;

      b. you disagree with the amount of the claim scheduled by
         any of the Debtors in their respective Schedules;

      c. any of the Debtors have scheduled your claim as
         disputed, contingent or unliquidated;

      d. you believe your claim to be a secured claim, and any
         of the Debtors have not so scheduled your claim; or

      e. you believe your claim to be entitled to priority under
         the Bankruptcy Code, and any of the Debtors have not so
         scheduled your claim.  

Claims need not be filed if they are:

      1. Claims properly filed with the Clerk of the Bankruptcy
         Court prior to the mailing of this notice;

      2. Interest Claims as Equity Security Holders;

      3. Claims by 11-1/4% Senior Subordinated Noteholders
         unless you are the Indenture Trustee for the public
         notes.

Fountain View is a leading operator of long-term care facilities
and a leading provider of a full continuum of post-acute care
services, with a strategic emphasis on sub-acute specialty
medical care. The Company operates a network of facilities in
California and Texas, including 43 skilled nursing and six
assisted living facilities. In addition to long-term care, the
Company provides a variety of high-quality ancillary services
such as physical, occupational and speech therapy and pharmacy
services. The company filed for Chapter 11 protection on October
2, 2001. Vanessa L. Butnick, Esq. at Klee Tuchin Bogdanoff &
Stern is helping the Debtors in its restructuring efforts.

                
GENESEE: Receives Full Payment of Management Buyout Bridge Loan
---------------------------------------------------------------
Genesee Corporation (Nasdaq: GENBB) received payment in full
from High Falls Brewing Company of the $6 million seller bridge
loan that financed a portion of the purchase price in the
December 2000 management buyout of the Corporation's brewing
business.

As a result of these transactions, the Corporation declared a
partial liquidating distribution of $5.00 per share, payable on
August 26, 2002 to Class A and Class B shareholders of record on
August 19, 2002.  The partial liquidating distribution announced
today is the fourth paid by the Corporation pursuant to the plan
of liquidation and dissolution approved by the Corporation's
shareholders in October 2000 and brings the total of liquidating
distributions paid to date to $51.1 million.  Distributions
totaling $25.50 per share were paid to shareholders on March 1,
2001, November 1, 2001 and May 17, 2002.

Under the terms of the management buyout, the bridge loan was
due and payable by High Falls Brewing Company upon its receipt
of a Section 108 grant and loan from the U.S. Department of
Housing and Urban Development, which it recently received.

"We are very pleased that the strong performance of High Falls
Brewing Company allowed it to complete its HUD financing and pay
off the Corporation's bridge loan," said Mark W. Leunig, Senior
Vice President and Chief Administrative Officer of Genesee
Corporation.  With repayment of the bridge loan, only $4 million
remains unpaid from the $11 million in financing

provided by the Corporation to facilitate the management buyout.  
Of the remaining indebtedness, $1 million is due on December 15,
2002 and the remaining $3 million is due on December 15, 2003.

Taking into account the bridge loan payment and the $5.00 per
share liquidating distribution payable August 26, 2002, the
Corporation updated its estimate of net assets in liquidation to
$21.3 million, or $12.69 per share, compared to net assets in
liquidation at April 27, 2002 of $29.6 million, or $17.69 per
share.

The Corporation expects to make additional liquidating
distributions as other contingent liabilities from the sale of
the Corporation's brewing business are discharged and as it
receives payment on the $4 million balance outstanding from High
Falls Brewing Company.  The Corporation also expects to make
additional liquidating distributions as contingent liabilities
and post-closing obligations from the sale of the Corporation's
foods business are discharged and it receives up to $2.4 million
escrowed in connection with the sale of the foods business.  
This escrow is scheduled to expire in April 2003.


GENTEK INC: S&P Drops Rating to SD Following Interest Nonpayment
----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on specialty components and performance chemicals
manufacturer GenTek Inc., to 'SD' from triple-'C' following the
company's announcement that it has received a blockage of
interest payment notice from its senior lenders regarding the
company's 11% senior subordinated notes due 2009.

Additionally, Standard & Poor's removed the rating from
CreditWatch where it was placed March 29, 2002. Hampton, New
Hampshire-based GenTek has nearly $1 billion in debt securities
outstanding.

As a result of the notice from its senior lenders, GenTek will
be unable to make its August 1, 2002, interest payment on its
11% senior subordinated notes. GenTek's senior credit facility
permits the company's senior lenders to issue one payment
blockage notice in any 12-month period while the company is in
default of its senior credit facility. If GenTek is not
permitted to make the interest payment on or before the August
31, 2002, grace period, acceleration of payment for the
principal amount and all accrued interest on all outstanding 11%
senior subordinated notes may result.

"There is a high likelihood that GenTek will be unable to make
the interest payment within the 30 day grace period," said
Standard & Poor's credit analyst Eric Ballantine.

Additionally, GenTek is currently not in compliance with its
bank covenants, and its senior lenders now have the right to
accelerate payment on more than $700 million in bank debt.
GenTek is in negotiations with its senior lenders to resolve the
default, however, bank negotiations have been challenging.
GenTek continues to experience very difficult end market
conditions in both automotive and telecommunications.

Standard & Poor's will continue to monitor events as they
develop. The senior secured rating could be lowered or withdrawn
should impairment occur.


GRAHAM PACKAGING: Unit Sales Increase as Total Revenues Decline
---------------------------------------------------------------
Graham Packaging Holdings Company, parent company of Graham
Packaging Company, L.P., said its worldwide unit sales increased
4 percent in the second quarter of 2002 and 7 percent in the
first six months of 2002, compared to the same periods last
year.

Sales in dollars declined compared to the same periods last
year, primarily due to a decline in the average price of resin,
the primary raw material utilized to produce the units, combined
with the company's restructuring process in Europe, which
involves the sale or closure of six locations.

The European restructuring would have lowered 2001 sales by
approximately $60 million had it been in place at the beginning
of 2001, the company said. The restructuring is helping the
company refocus on key strategic customers, those with whom it
has on-site manufacturing operations utilizing the most
competitive technology.

Chief Financial Officer John E. Hamilton said worldwide adjusted
earnings before interest, taxes, and depreciation (adjusted
EBITDA) in the second quarter were 18 percent ahead of the same
period last year.

The earnings were achieved on worldwide sales of $236 million, 4
percent below the second quarter of 2001. Net income for the
quarter totaled $14 million, compared to a net loss of $1.2
million in the same period last year. Excluding locations
impacted by the European restructuring, sales in the second
quarter of 2002 would have been approximately equal to the sales
in the same period of 2001 and unit volume would have grown 11
percent.

"We continue to be very pleased with the improvement in
earnings," Hamilton said. "The economic environment of the past
two years has necessitated a strong focus on improving the
operating costs of our business through restructuring and
improved utilization, primarily in Europe. Although we currently
expect these and other restructuring activities will result in
total non-recurring charges of approximately $20 million in 2002
-- $6.4 million of which was incurred in the first half of 2002
-- the benefits of these efforts are beginning to be reflected
in the financial results of the company."

For the first six months of 2002, worldwide sales were $468
million, 3 percent below the same period last year. Adjusted
EBITDA for the first six months was more than 18 percent above
2001. Net income for the first six months of 2002 totaled $17.2
million, compared to a net loss of $7.4 million in the same
period last year. Excluding locations impacted by the European
restructuring, sales for the first six months of 2002 would have
increased approximately 1 percent on unit growth of 14 percent
as compared to the same period in 2001.

Based in York, Graham Packaging designs and makes customized
blow-molded plastic containers for branded food and beverage
products, household and personal care products, and automotive
lubricants. The company currently operates 56 plants and employs
approximately 4,000 people throughout North America, Europe, and
Latin America. It produced more than eight billion containers
and reported total worldwide sales of approximately $923 million
in 2001.

As reported in Troubled Company Reporter's June 19, 2002,
edition, Standard & Poor's assigned a B rating to Graham
Packaging's $700 million credit facility.


HOLLINGER INTL: S&P Assigns BB- Rating to $350MM Credit Facility
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its double-'B'-minus
rating to Hollinger International Publishing Inc.'s proposed
US$350 million three-tranche senior secured bank facility due
between 2008 and 2009. Net proceeds will be used to refinance
outstanding indebtedness, including the remaining US$239.1
million 9.25% senior subordinated notes due 2006 and a portion
of the 9.25% senior subordinated notes due 2007, and for general
corporate purposes.

"The double-'B'-minus rating on Hollinger International
Publishing's bank facility equals the long-term corporate credit
rating on the company and its 100% parent, Hollinger
International Inc.," said Standard & Poor's credit analyst
Barbara Komjathy.

The proposed US$350 million facility has three tranches: a US$50
million senior secured revolving credit facility due June 30,
2008; a US$50 million senior secured term loan A due June 30,
2008; and a US$250 million senior secured term loan B due June
30, 2009. The borrowers under the revolving facility are
Hollinger International Publishing and Telegraph Group Ltd.,
while under the term facilities the borrower is First DT
Holdings Ltd., which, together with the Telegraph Group,
represent the U.K. borrowers. The term loan A and B tranches of
the credit facility are secured by a first perfected lien on
Hollinger International Publishing's U.S. and U.K. assets and
capital stock of present and future subsidiaries, and also are
guaranteed by Hollinger International. The revolver tranche of
the credit facility has the same U.S. security and guarantees as
the term loan tranches, but only has a first priority pledge of
65% of the capital stock of present and future U.K.
subsidiaries.

The term loans have scheduled annual amortization payments, and
the company is required to use a portion of its excess cash flow
to permanently reduce borrowings. Financial covenants include
minimum interest coverage ratios and fixed-charge coverage
ratios, as well as maximum leverage ratios.

Although Standard & Poor's believes there is a strong
possibility of substantial recovery of principal in the event of
default or bankruptcy, its level of confidence in full recovery
is not sufficient to warrant the bank loan being rated one notch
higher than the long-term corporate credit rating. Elements of a
default scenario from a business perspective could include
deterioration in market position, readership, and circulation of
key newspapers, coupled with a sharp decline in advertising in
an escalating newsprint price environment. From a financial
perspective, elements of a default scenario could include
failure to achieve meaningful improvements in operating cash
flow generation. In addition, the bank loan rating did not
consider the US$305.1 million income taxes payable on the
company's balance sheet given Hollinger International
Publishing's indication that it is not likely to become payable.


HOULIHAN'S: Panel Says Disclosure Statement Lacks Information
-------------------------------------------------------------
The Official Committee of Unsecured Creditors appointed in the
chapter 11 case pertaining to Houlihan's Restaurants, Inc.,
objects to the Debtor's Disclosure Statement.  The Committee
tells the U.S. Bankruptcy Court for the Western District of
Missouri that the Disclosure Statement should not be approved
because it does not contain "adequate information" as required
under 11 U.S.C. Sec. 1125(b).

Specifically, the Committee complains, the Debtor's Disclosure
Statement:

     1) fails to provide adequate information regarding material
        changes in the Debtors' Plan, e.g. the Debtors'
        settlement with CNL;

     2) proposes to distribute a "Plan Supplement" which would
        contain information that should be, but is not
        currently, contained in the disclosure statement,
        including the details of executive compensation, the
        terms of the Term Debt, and the rights and powers of the
        Preferred and Common Stock to be issued to the Classes 1
        and 8;

     3) fails to provide adequate information regarding the
        approximately $33.9 million in contingent litigation
        claims against the Debtors; and

     4) fails to provide adequate information regarding the
        amount and planned disposition of the Debtors'
        litigation claims against others, such as preference and
        fraudulent transfer actions.

The Creditors' Committee assures the Court that it will continue
negotiating with the Debtor in good faith towards a consensual
plan.

Houlihan's Restaurants, Inc., filed for chapter 11 protection on
January 23, 2002. Cynthia Dillard Parres, Esq., and Laurence M.
Frazen, Esq., at Bryan, Cave LLP represent the Debtors in their
restructuring efforts.  Stephen B. Sutton, Esq., and Brian T.
Fenimore, Esq., at Lathrop & Gage LC represent the Official
Unsecured Creditors' Committee.  When the Company filed for
protection from its creditors, it listed estimated debts and
assets of more than $100 million.


IGO CORP: Maintains Nasdaq Listing Pending Completion of Merger
---------------------------------------------------------------
iGo Corporation (Nasdaq: IGOC), a leading mobile and wireless
accessories solution provider, received a letter from Nasdaq,
indicating that the Listing Qualifications Panel determined that
the company will remain listed on The Nasdaq National Market
pending the consummation of its merger with Mobility
Electronics, Inc. (Nasdaq: MOBE).  The Panel's determination
follows an oral hearing on July 11, 2002 in which the company
requested such an extension.

The Nasdaq Listing Qualifications Panel has given the company
until October 11, 2002 to consummate the merger with Mobility.  
Immediately thereafter, the company must voluntarily delist its
securities from The Nasdaq National Market.  In the event the
company fails to consummate the merger with Mobility, its
securities may be transferred to The Nasdaq SmallCap Market,
provided the company satisfies all requirements for continued
listing on that market, with the exception of the minimum bid
price standard, for which it would likely be granted an extended
grace period within which to regain compliance with that
standard.  The company currently meets all other listing
requirements for The Nasdaq SmallCap Market.

David Olson, Acting President and CEO of the company stated, "we
are of course very pleased that the Listing Qualifications Panel
has granted us this exception to allow our securities to remain
listed on The Nasdaq National Market pending the completion of
our merger with Mobility."

It is a requirement during the period of this exception from the
Nasdaq Marketplace Rules that the company provide prompt
notification to the Listing Qualifications Panel of any
significant developments.  If there is a material change in the
company's financial or operational characteristics, the Listing
Qualifications Panel reserves the right to reconsider the terms
of the exception granted to the company.  There can be no
assurance that the exception will remain in effect for any
specific period of time, or that the company's securities will
not ultimately be transferred to The Nasdaq SmallCap Market or
otherwise delisted.

iGo Corporation (Nasdaq: IGOC) is a leading business-to-business
developer and multi-channel marketer of parts and accessories
including batteries, adapters and chargers for notebooks, cell
phones and handheld devices.  The company's products address the
needs of mobile professionals and corporations with mobile
workforces that demand solutions to keep them powered up and
connected.  iGo enables many of the FORTUNE 500 to efficiently
purchase and receive mobile products and services.  iGo develops
its own line of mobile accessories under the Xtend and Road
Warrior brands.  iGo's products are available toll-free (1-800-
DIAL-IGO), on its award-winning Web site -- http://www.igo.com-
- and through dedicated corporate account teams.  Products are
also available through leading distributors, including Ingram
Micro and Tech Data, and over 1,100 resellers nationwide.  iGo's
alliances and business partners include companies such as Acer,
IBM and NEC.  For more information about iGo, please see "About
iGo" at http://www.igo.com  


ISTAR FINANCIAL: S&P Affirms BB+ Long-Term Counterparty Rating
--------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its ratings on iStar
Financial Inc., and its wholly owned subsidiary, TriNet
Corporate Realty Trust Inc., including both companies' double-
'B'-plus long-term counterparty credit ratings. Approximately
$800 million of debt and preferred stock is affected. The
outlook was changed to positive from stable.

The outlook revision reflects the company's strong asset-quality
performance, demonstrated through both a weak economic
environment and a difficult real estate market; substantial
capitalization of $1.9 billion in equity; and continued efforts
to term out its debt structure. iStar has continued to reduce
marginally the credit risk in its credit tenant leasing (CTL)
portfolio, and its mortgage portfolio has performed well since
September 11, 2001, and through the current weak economic
environment and volatile real estate market.

Nevertheless, the ratings continue to reflect the risks inherent
in a monoline commercial real estate company. The company's real
estate exposure to New York properties remains a concern, as
well as concentrations in office properties and the West coast.
While the company's nonaccrual list is short and the company has
not experienced a charge-off in its entire history, there are a
number of credits that iStar is monitoring that may pose a
potential future problem.

Additionally, Standard & Poor's remains concerned about iStar's
high level of secured debt, which would structurally subordinate
the unsecured bondholder. It would be prudent for iStar to
continue to raise unsecured debt in the capital markets, thereby
increasing the ratio of unsecured debt-to-total assets and
unencumbered assets-to-unsecured debt.

iStar's financial flexibility continues to be reduced because of
its REIT status; the company must pay out 90% of its taxable
income to shareholders. Leverage has continued to rise modestly,
but management still contends that the debt-to-equity ratio will
not exceed 2.0 times. Standard & Poor's believes that it would
be prudent for the company to continue to build capital and
reserves to cushion any future unforeseen large problem loans or
operating leases.

"A ratings upgrade is predicated on continued strong asset
quality performance through full economic and real estate
cycles, reduced dependency on secured debt, and continued
progress in minimizing its refinancing risk and laddering its
debt maturities. iStar would also be expected to continue its
momentum in building capital and reserves, keeping leverage in
balance," said credit analyst Lisa J. Archinow, CFA.


INTERNATIONAL MULTIFOODS: S&P Keeping Watch on BB/BB+ Ratings
-------------------------------------------------------------
Standard & Poor's placed its double-'B' long-term corporate
credit rating and its double-'B'-plus senior secured debt rating
for Minnetonka, Minnesota-based International Multifoods Corp.,
on CreditWatch with developing implications.

Total rated debt is about $650 million.

The CreditWatch placement follows International Multifoods'
announcement that it has entered into an agreement to sell its
foodservice distribution business to an affiliate of a private
equity firm, Wellspring Capital Management LLC, for about $180
million. Net proceeds from the transaction will be used to
reduce outstanding debt.

"The ratings could be lowered because the remaining business
will be a much smaller participant in the packaged foods
industry, which is dominated by larger players with significant
market positions and greater financial resources," said Standard
& Poor's credit analyst Susan Ding. "Conversely, the ratings
could be raised because there is potential for improved
financial measures resulting from the lower interest expenses
from the proposed debt reduction. The ratings could be affirmed
as International Multifoods looks to increase its remaining
packaged foods business."

Standard & Poor's will meet with the company to discuss its
operating and financial strategies.

  
KAISER ALUMINUM: LA Scrap Asks Court to Okay Reclamation Rights
---------------------------------------------------------------
Los Angeles Scrap Iron and Metal Corp. seeks the Court's
approval of its reclamation rights with respect to the scrap
metal it sold and shipped to Kaiser Aluminum Corp. between
January 31, 2002 and February 12, 2002.

Of the total amount owed to LA Scrap by Kaiser, the scrap metal
accounts for $669,890.

Donald J. Detweiler, Esq., at Saul Ewing LLP, in Wilmington,
Delaware, informs the Court that LA Scrap timely asserted
reclamation rights, as to those shipped scrap metal, under
Bankruptcy Code Section 546(c)(1) and Uniform Commercial Code
Section 2-702 (California Commercial Code Section 2702) by
letter dated February 26, 2002.

Mr. Detweiler relates that LA Scrap is actually owed $1,430,154
by Kaiser as of the Petition Date.  LA Scrap furnishes scrap
metal to Kaiser plants located in Los Angeles, as well as
Trentwood, Washington and other locales in the Pacific
Northwest. It has been doing business with Kaiser since 1993.
In the alternative, LA Scrap asks the Court to grant it either a
security interest or an administrative expense priority as
authorized under Bankruptcy Code Section 546(c)(2). (Kaiser
Bankruptcy News, Issue No. 12; Bankruptcy Creditors' Service,
Inc., 609/392-0900)   

Kaiser Aluminum & Chemicals' 12.75% bonds due 2003 (KLU03USR1),
DebtTraders reports, are trading at 17 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=KLU03USR1for  
real-time bond pricing.


LAND O'LAKES: Moody's Reviewing Ratings for Possible Downgrade
--------------------------------------------------------------
Moody's Investors Service places the ratings of Land O'Lakes,
Inc., and its trust subsidiary, Land O'Lakes Capital Trust I,
under review for likely ratings downgrade.

Ratings placed under review are:

                  Land O'Lakes, Inc.

           * Senior implied rating of Ba2;

           * Senior secured rating of Ba2;

           * Senior unsecured issuer rating of Ba3;

           * Senior unsecured rating at Ba3.

              Land O'Lakes Capital Trust I

           * Trust preferred securities at Ba3.

The action reflects the company's lower than expected operating
performance and its weakening credit measures. Land O'Lakes core
dairy business began generating operating losses as it
continually faces stiff competition from market overcapacity and
lower prices.

Moody's says that its review will focus on the actions the
company will take to improve operating performance and the
effectiveness of these actions to strengthen credit protection
measures.

Land O'Lakes, a branded dairy food, feed and agricultural supply
cooperative, is headquartered in Arden Hills, Minnesota.


LIN HOLDINGS: S&P Revises Outlook as Financial Profile Improves
---------------------------------------------------------------
Standard & Poor's Ratings Services has revised its outlook on TV
station operator LIN Holdings Corp., and its subsidiary LIN
Television Corp., to positive from stable based on continued
improvement to the company's financial profile.

Standard & Poor's said that at the same time it has affirmed its
ratings on the companies. Standard & Poor's corporate credit
ratings on the companies, which are rated on a consolidated
basis, are single-'B'-plus. Providence, Rhode Island-based LIN's
total pro forma debt at March 31, 2002, was about $880 million.

"The outlook revision is based on expectations that LIN will
further improve its financial profile following the May 2002
initial public offering of its parent company, LIN TV Corp.",
said Standard & Poor's credit analyst Eric Geil. "Also, LIN's
use of equity to temper potential acquisition risk, and
strengthening advertising demand are important to the revision".

Standard & Poor's noted that further financial profile
improvement from strengthening ad demand could contribute to the
longer term rating upside. Standard and Poor's will look for
consistent adherence to a deleveraging policy following a long
period of high leverage. Debt-financed acquisitions could limit
improvement over the near to intermediate term.

Standard & Poor's said that its ratings continue to reflect the
company's high financial risk from debt-financed TV station
acquisitions, expectations of further purchases that could limit
financial profile improvement, and mature growth prospects of
the TV station business. Tempering factors include the stations'
leading positions in medium-size markets, geographic and network
diversity, the inherent free cash flow potential of the
business, and good station asset values.

LIN has 24 TV stations reaching about 7% of U.S. households
through 21 markets ranked between 25 and 199. Included in the
portfolio are stations affiliated with the three major broadcast
networks in six of the top 50 markets.


MAJESTIC INVESTOR: May Seek New Financing to Satisfy Obligations
----------------------------------------------------------------
Majestic Investor Holdings LLC was formed on September 14, 2001
and commenced operations of the Fitzgeralds casinos on December
7, 2001, and accordingly has a limited operating history.
Therefore, the discussion of operations herein will focus on
events and the Company's revenues and expenses during the period
from inception (September 14, 2001) through December 31, 2001.
In addition, this section discusses the combined results of
operations of the three Fitzgeralds casino properties on a
historical basis.

Consolidated gross revenues were $12,832,000 for the period from
inception (September 14, 2001) through December 31, 2001.
Revenues for Fitzgeralds Tunica accounted for $6,708,000, or
52.3% of total revenues, Fitzgeralds Las Vegas accounted for
$3,445,000, or 26.8% of total revenues, and Fitzgeralds Black
Hawk accounted for $2,679,000, or 20.9% of total revenues.

The Company's business can be separated into four operating
departments: casino, rooms (except Fitzgeralds Black Hawk), food
and beverage and other. Consolidated casino revenues were
$10,359,000, of which $9,011,000, or 87.0% were derived from
slot machine revenues, and $1,348,000, or 13.0%, were
derived from table game revenues for the period from inception
through December 31, 2001.

Casino revenues attributed to Fitzgeralds Tunica were
$5,494,000, of which $4,800,000, or 87.4% were derived from slot
machine revenues, and $694,000, or 12.6% were derived from table
games revenues for the period from inception through December
31, 2001. Casino revenues attributed to Fitzgeralds
Las Vegas were $2,355,000, of which $1,764,000, or 74.9% were
derived from slot machine revenues, and $591,000, or 25.1% were
derived from table game revenues for the period from inception
through December 31, 2001. Casino revenues attributed to
Fitzgeralds Black Hawk were $2,510,000, of which $2,446,000, or
97.5% were derived from slot machine revenues, and $64,000, or
2.5% were derived from table game revenues for the period from
inception through December 31, 2001.

The consolidated average number of slot machines in operation
was 2,935 during the period from inception through December 31,
2001, of which Fitzgeralds Tunica accounted for 1,388, or 47.3%,
Fitzgeralds Las Vegas accounted for 951 or 32.4%, and
Fitzgeralds Black Hawk accounted for 596 or 20.3%. The
consolidated average win per slot machine per day was
approximately $123 for the period from inception through
December 31, 2001, with an average of approximately $138, $74
and $164 at Fitzgeralds Tunica, Fitzgeralds Las Vegas and
Fitzgeralds Black Hawk, respectively. The consolidated average
number of table games in operation during the period from
inception through December 31, 2001, was 64, of which Tunica
accounted for 34, or 53.1%, Fitzgeralds Las Vegas accounted for
24, or 37.5%, and Fitzgeralds Black Hawk accounted for 6, or
9.4%. The average win per table game per day during the period
from inception through December 31, 2001, was approximately
$843, with an average of approximately $839, $947, and $424 at
Fitzgeralds Tunica, Fitzgeralds Las Vegas and Fitzgeralds Black
Hawk, respectively.

Consolidated room revenues for the period from inception through
December 31, 2001 was $1,079,000, or 8.41% of the total revenue.
Of this amount, Fitzgeralds Tunica accounted for $544,000 or
50.4% with 507 rooms and Fitzgeralds Las Vegas accounted for
$535,000 or 49.6% with 638 rooms. At Fitzgeralds Tunica during
this period the average daily rate was $50 and the occupancy
rate was 86.5%. At Fitzgeralds Las Vegas during this period the
average daily rate was $42 and the occupancy rate was 79.8%.

Consolidated food and beverage revenues for the period from
inception through December 31, 2001, amounted to $1,190,000, or
9.3% of the total revenue. Of this amount, Fitzgeralds Tunica
accounted for $586,000, or 49.3%, Fitzgeralds Las Vegas
accounted for $448,000, or 37.6% and Fitzgeralds Black Hawk
accounted for $156,000 or 13.1%.

Other consolidated revenues consisted primarily of commission
and retail income and totaled approximately $204,000, or 1.6% of
total revenue. Of this amount, Fitzgeralds Tunica accounted for
$84,000 or 41.2%, Fitzgeralds Las Vegas accounted for
approximately $107,000 or 52.4%, and Fitzgeralds Black Hawk
accounted for $13,000 or 6.4%.

Promotional allowances included in the consolidated gross
revenues for the period from inception through December 31, 2001
were $2,311,000, or 18.0% of gross revenues. Of this amount,
Fitzgeralds Tunica accounted for $1,340,000, or 58.0%,
Fitzgeralds Las Vegas accounted for $365,000, or 15.8%, and
Fitzgeralds Black Hawk accounted for $606,000, or 26.2%.

Unfortunately the Company realized a net loss of $1,271,000 for
the period from inception through December 31, 2001.

Majestic has a significant amount of debt. It currently has
outstanding $152.6 million of long-term debt represented by the
Investor Holdings Senior Secured Notes. At December 31, 2001 it
also had $6.5 million outstanding under the $15.0 million
Investor Holdings Credit Facility. In addition, the Investor
Holdings Indenture and Investor Holdings Credit Facility will
permit it to incur additional debt in certain circumstances,
including to finance the purchase of furniture and equipment.

The Company might not be able to generate sufficient cash flow
to service its debt, to repay the Investor Holdings Senior
Secured Notes when due or to meet unanticipated capital needs or
shortfalls in its projections. The Company plans to be able to
service its debt and repay the Investor Holdings Senior Secured
Notes when due with cash from operations. The ability to
generate sufficient cash flow to satisfy obligations will depend
on the future performance of its gaming operations, which is
subject to many economic, political, competitive, regulatory and
other factors that it is not able to control. However, if cash
flows from operations are not sufficient to satisfy obligations,
the Company may need to seek additional financing in the debt or
equity markets, refinance the Investor Holdings Senior Secured
Notes, sell selected assets or reduce or delay planned
activities and capital expenditures. Any such financings or sale
of assets might not be available on economically favorable
terms, if at all, and may be difficult because of governmental
restrictions on ownership. In the event that Majestic is left
without sufficient liquidity to meet its debt service
requirements, an event of default would occur under the Investor
Holdings Indenture and the Investor Holdings Credit Facility.
The Investor Holdings Senior Secured Notes and the Investor
Holdings Credit Facility are secured by substantially all
Company current and future assets.  Further, the Company is
required to pay weekly liquidated damages under its senior
secured notes.

Majestic has not registered its Investor Holdings Senior Secured
Notes and accordingly it is obligated to pay liquidated damages
amounts until such notes are registered. Under the registration
rights agreement related to the Majestic Investor Holdings
Senior Secured Notes, the Company is required to pay an amount
per week per $1,000 principal amount of Registrable Securities
equal to $0.05 for the first 90-day period following April 5,
2002, increasing by an additional $0.05 per week with respect to
each subsequent 90-day period, up to a maximum amount of $0.20
per week.

Since Majestic is a holding company its ability to make payments
on the Investor Holdings Senior Secured Notes and to service
other debt depends on cash flow from its subsidiaries.


MYRIENT INC: May 31, 2002 Balance Sheet Upside-Down by $21 Mill.
----------------------------------------------------------------
As of May 31, 2002, Myrient, Inc., has negative working capital
of approximately $19,000,000, is in default on substantially all
notes payable, and has a stockholders' deficit of approximately
$21,000,000.

The Company hopes to continue to increase revenues from
additional revenue sources and increase margins as a result of
amending its contracts with vendors and other cost cutting
measures. In the absence of significant revenues and profits,
the Company intends to fund operations through additional debt
and equity financing arrangements which management believes may
be insufficient to fund its capital expenditures, working
capital, and other cash requirements for the fiscal year ending
August 31, 2002. Therefore, the Company may be required to seek
additional funds to finance its long-term operations. The
successful outcome of future activities cannot be determined at
this time and there are no assurances that if achieved, the
Company will have sufficient funds to execute its intended
business plan or generate positive operating results.

These circumstances raise substantial doubt about the Company's
ability to continue as a going concern.

Myrient, Inc., is an outsourced Information Technology solutions
provider that delivers managed services that allow enterprises
to conduct secure communications with remote offices, partners
and customers worldwide. The Company enables its customers to
outsource all of their communications needs, while ensuring the
highest level of security and reliability. The Company manages
and controls a nationwide data communications network that
allows it to offer high-quality integrated turnkey solutions.
The Company's services include Managed Virtual Private
Networking, Broadband Internet Access, Managed Web Hosting,
Storage and off-site disaster recovery services, Network and
Systems Management, and Professional Services.

Net Sales totaled approximately $2,543,567 for the three months
ended May 31, 2002, a $1,238,744 decrease over revenue of
$3,782,311 for the three months ended May 31, 2001. Revenues
generated from Broadband Internet Access decreased to zero
primarily due to the reduction of approximately 150 individuals
involved in reselling retail based business class digital
subscriber lines connectivity during the three months ended May
31, 2002 as compared to the three months ended May 31, 2001. The
decrease was offset by an increase in revenues generated from
Real Private Networking, Internet and Intranet based Web
Hosting, Hosted Application Services, Intelligent Routing and
Content Delivery Services, Managed Virtual Private Networking
and Professional Services, as well as a non-recurring increase
in revenue of $2,180,326 resulting from the sale of customer
premises equipment for the three months ended May 31, 2002 as
compared to the corresponding period of 2001.

Cost of sales for the three months ended May 31, 2002 was
$297,580, a decrease of $2,022,013 from $2,319,593 for the three
months ended May 31, 2001. Cost of sales consists primarily of
access charges from local exchange carriers, backbone and
Internet access costs, and the cost of customer equipment to
support network systems, and a non-recurring cost associated
with the purchase of customer premises equipment of $197,413.
The Company's Internet access costs significantly decreased
reflecting the decrease in revenues generated from Broadband
Internet Access during the three months ended May 31, 2002 as
compared to the corresponding period of 2001.

Gross profit increased $783,269 to $2,245,987 for the three
months ended May 31, 2002 from $1,462,718 for the three months
ended May 31, 2001 and the profit margin increased 49% to 88%
for the three months ended May 31, 2002 from 39% for the three
months ended May 31, 2001. The increase in gross profit and the
increase in gross profit margin resulted from a significant
decrease in revenues generated from the lower margin services
(Broadband Internet Access delivered over DSL) and an increase
in revenues generated from the higher margin services (managed
services including Real Private Networking, Internet and
Intranet based Web Hosting, Hosted Application Services,
Intelligent Routing and Content Delivery Services, Managed
Virtual Private Networking and Professional Services), as well
as a non-recurring increase in profit resulting from the sale of
customer premises equipment of $1,982,913 which accounted for
88% of the gross profit, during the three months ended May 31,
2002 as compared to the corresponding period of 2001.

The net result, after factoring in the Company's operational
expenses, showed that the Company incurred a net loss for the
three-month period ended May 31, 2002 of $3,581,403 compared to
a loss of $718,309 for the three months ended May 31, 2001.

           Results of Operation for the Nine Months
                      Ended May 31, 2002

Net sales decreased $4,792,534 to $7,530,889 for the nine months
ended May 31, 2002 from $12,323,423 for the nine months ended
May 31, 2001. Revenues generated from Broadband Internet Access
decreased to zero primarily due to the reduction of
approximately 150 individuals involved in reselling retail based
business class digital subscriber lines connectivity during the
nine months ended May 31, 2002 as compared to the nine months
ended May 31, 2001. The decrease was offset by an increase in
revenues generated from Real Private Networking, Internet and
Intranet based Web Hosting, Hosted Application Services,
Intelligent Routing and Content Delivery Services, Managed
Virtual Private Networking and Professional Services as well as
a non-recurring increase in revenue of $ 2,969,103 resulting
from the sale of customer premises equipment for the nine months
ended May 31, 2002 as compared to the corresponding period of
2001.

Cost of sales decreased $5,384,239 to $2,851,855 for the nine
months ended May 31, 2002 from $8,236,094 for the nine months
ended May 31, 2001. Cost of sales consists primarily of access
charges from local exchange carriers, backbone and Internet
access costs and the cost of customer equipment to support
network systems, and a non-recurring cost associated with the
purchase of customer premises equipment of $261,918. The
Company's Internet access costs significantly decreased
reflecting the decrease in revenues generated from Broadband
Internet Access during the nine months ended May 31, 2002 as
compared to the corresponding period of 2001.

Gross profit increased $591,705 to $4,679,034 for the nine
months ended May 31, 2002 from $4,087,329 for the nine months
ended May 31, 2001 and the profit margin increased 29% to 62%
for the nine months ended May 31, 2002 from 33% for the nine
months ended May 31, 2001. The increase in gross profit and the
increase in gross profit margin resulted from a significant
decrease in revenues generated from the lower margin services
(Broadband Internet Access delivered over DSL) and an increase
in revenues generated from the higher margin services (managed
services including Real Private Networking, Internet and
Intranet based Web Hosting, Hosted Application Services,
Intelligent Routing and Content Delivery Services, Managed
Virtual Private Networking and Professional Services), as well
as a non-recurring increase in profit resulting from the sale of
customer premises equipment of $2,707,185 which accounted for
58% of the gross profit during the nine months ended May 31,
2002 as compared to the corresponding period of 2001.

Here again, the Company experienced a net loss of $4,829,934 for
the nine months ended May 31, 2002 as compared to a net loss of
$4,251,301 for the nine months ended May 31, 2001.

The Company's independent certified public accountants have
stated in their report in the Company's Form 10-KSB for the year
ended August 31, 2001, that the Company had incurred operating
losses in the last two years, had a working capital deficit
(including a significant accrued payroll taxes due to under
payment of payroll taxes), a significant long-term borrowing
balance and a significant stockholders' deficit. The Company's
working capital deficit increased $1,720,335 to $19,116,843 on
May 31, 2002 from $17,396,508 on August 31, 2001 and the
stockholders' deficit increased $3,545,905 to $20,573,614 on May
31, 2002 from $17,027,705 on August 31, 2001. As stated above,
these financial conditions raise substantial doubt about the
Company's ability to continue as a going concern.


NATIONAL STEEL: Government Asks Court to Extend Claims Bar Date
---------------------------------------------------------------
The United States of America ask the Court to extend the
September 6, 2002 bar date for filing federal tax claims against
National Steel Corporation and its debtor-affiliates to January
31, 2003.

Patrick J. Fitzgerald, Esq., United States Attorney for the
Northern District of Illinois, explains that an audit of a
multi-million dollar group of corporations like the Debtors is
extremely complex and time-consuming.  Given the extent, scope
and complexity of the audits at issue, the Internal Revenue
Service will be unable to file accurate claims with respect to
the Debtors' federal income tax liabilities before September 6,
2002.  The Internal Revenue Service expects to complete their
review and analysis of all adjustments to the audit years on or
before December 31, 2002.

"It appears that there will be a significant adjustment of the
1997 federal income tax, however, the ultimate amount due from
the Debtors will depend on the availability of net operating
losses to carry back from the more recent years," Mr. Fitzgerald
says.

Mr. Fitzgerald tells the Court that the Debtors had requested
refunds of 1996, 1997 and 1998 federal income tax payments
reaching over $52,000,000.  However, the carryback adjustments
and computations, which will include a final report of the 2000
and 2001 federal income tax returns, are still subject to review
and approval by the Joint Committee on Taxation of the United
States Congress. (National Steel Bankruptcy News, Issue No. 12;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


NEW WORLD PASTA: S&P Ratchets Up Corporate Credit Rating to B+
--------------------------------------------------------------
Standard & Poor's raised its corporate credit rating on branded
pasta food manufacturer New World Pasta Co., to single-'B'-plus
from single-'B' and raised its bank loan rating to single-'B'-
plus from single-'B'. At the same time, Standard & Poor's raised
the $160 million senior subordinated notes rating to single-'B'-
minus from triple-'C'-plus.

The outlook is stable.

About $340 million of total debt was outstanding at March 30,
2002.

The ratings upgrade reflects improved operating performance
stemming from continued sales volume growth, strong market
share, and ongoing cost-saving initiatives, which have resulted
in a strengthening of the company's financial ratios.

"The ratings on the Harrisburg, Pa.-based company reflect the
challenging industry conditions under which the company operates
and its high debt leverage. Mitigating factors are the company's
leading market position in the U.S. dry pasta category and good
product portfolio diversity," said Standard & Poor's analyst
Ronald Neysmith.

The company holds the leading market position in the U.S. dry
pasta category. On a combined basis, the company holds about a
32% U.S. market share and about a 41% share in Canada. New World
has six of the top eight brands in the U.S. and Ronzoni is the
third largest pasta brand accounting for a 7.0% market share.
Products are sold under regional brand names, including Ronzoni,
San Giorgio, American Beauty, Skinner, Ideal, and P&R. The
branded dry pasta category is currently experiencing very
competitive industry conditions in the retail channel from
increased competition by private label manufacturers.

While the company's No. 1 market position has remained strong,
the company's sales (excluding the recent Borden Pasta Group
acquisition) declined 8.7% for the three-month period ended
March 30, 2002, due to reduced sales promotions on certain pasta
brands. However, New World initiated a number of restructuring
initiatives to consolidate facilities and improve operating
efficiency within its network of plants, completed the Borden
integration, and reduced headcount. As a result, total savings
are expected to be about $21 million annually.


ORBITAL SCIENCES: Liquidity Issues Prompt S&P to Junk Rating
------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on satellite and launch vehicle manufacturer Orbital
Sciences Corp., to triple-'C'-plus from single-'B' and placed
the ratings on CreditWatch with developing implications. At the
same time, the rating on Orbital's $100 million subordinated
convertible notes due October 1, 2002, was lowered to triple-
'C'-minus from triple-'C'-plus and also placed on CreditWatch
with developing implications. Orbital has approximately $130
million in debt.

"The rating actions reflect the constrained liquidity situation
at Dulles, Virginia-based Orbital and concerns that the company
will not be able to refinance or repay the $100 million of
subordinated convertible notes maturing in October 2002," said
Standard & Poor's credit analyst Christopher DeNicolo. Liquidity
($57 million cash and $12 million revolver availability at June
30, 2002) is likely adequate for day-to-day operations, but is
not sufficient to make the debt payment in October. Management
is exploring several alternatives to refinance the notes,
including issuing new debt or equity, as well as an exchange for
debt and equity securities. Current market conditions may
complicate the company's efforts to refinance. The company has
stated in its recent 10-Q filing with the SEC that its ability
to continue as a going concern is contingent on successfully
refinancing the notes.

Operating performance has improved significantly in 2002 after
the company sold a number of operations in 2001 and improved
operations at the remainder. Orbital was profitable for the
first two quarters of 2002, for the first time in several years.
The company has benefited from a contract with Boeing related to
the missile defense booster vehicle program and improvements in
its satellite operations.

The CreditWatch will be resolved when the company has either
arranged refinancing or fails to make its principal payment in
October. A failure to make the $100 million principal payment or
an exchange offer that does not give the noteholders what they
are contractually entitled to receive would result in the rating
on the notes being lowered to 'D' and the corporate credit
rating on Orbital being lowered to 'SD' (selective default). If
Orbital is successful in refinancing, ratings will likely be
raised.


OWENS CORNING: Court Okays PwC to Replace Arthur Andersen
---------------------------------------------------------
Owens Corning and its debtor-affiliates obtained permission from
the Court to expand the employment and retention of
PricewaterhouseCoopers LLP, the Debtors' Special Financial
and Tax Advisor, nunc pro tunc to April 4, 2002.  In addition to
the advisory services it has rendered, PwC will replace Arthur
Andersen LLP as the Debtors' independent public accountants.

PwC will render these additional services in the Debtors' cases:

A. Audit the consolidated financial statements of the Company at
   December 31, 2002 and for the year ending or those other
   years as the parties agree in future engagement letters;

B. Review the Company's un-audited quarterly financial
   statements and related data;

C. Provide information to be included in the Company's reports
   filed with the Securities and Exchange Commission;

D. Audit the financial statements of the Company's employee
   benefit plans for the year ended December 31, 2001 and other
   years as the parties agree in future engagement letters; and,

E. Provide other assurances related services including carve-out
   audits and other special projects as requested by the
   Debtors' management.

PwC will be paid in accordance with the hourly rates of its
professionals, who will be paid in accordance with billing
category range of the firm:

                  Position                       Range
                  --------                       -----
         Partner and Principals                $580-889
         Senior Managers and Managers           425-698
         Staff and Senior Associates            180-469
         Support/Administrative Staff            89-103

These professionals are expected to have primary responsibility
for providing the additional services to the Debtors, with their
hourly rates:

                  Peter Kelley    $682
                  Sharad Jain      682
                  Ted Young        733

PwC will also be paid its annual fees for auditing services,
pegged at $1,750,00, exclusive of out-of-pocket expenses. (Owens
Corning Bankruptcy News, Issue No. 35; Bankruptcy Creditors'
Service, Inc., 609/392-0900)   

Owens Corning's 7.7% bonds due 2008 (OWC08USR1) are trading at
38.75 cents-on-the-dollar, DebtTraders reports. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=OWC08USR1for  
real-time bond pricing.


OWOSSO CORP: Fails to Comply with Nasdaq Listing Requirements
-------------------------------------------------------------
Owosso Corporation (Nasdaq: OWOS) has completed the sale of its
Motor Products subsidiaries to a subsidiary of Hathaway
Corporation (Nasdaq: HATH) for $11.5 million in cash and a
$300,000 note guaranteed by Hathaway Corporation.

Owosso expects to recognize a pretax gain, net of expenses, on
the sale of approximately $6.0 million, and that the gain from
the sale will be sheltered by net operating losses.  The net
proceeds of the sale will be used to reduce Owosso's outstanding
bank debt.

Motor Products had revenues of $25.3 million, pretax income
before corporate allocation of $1.85 million, EBITDA of $2.8
million and total assets of $11 million for the fiscal year
ended October 28, 2001.

In addition, Owosso announced that it received a letter from the
Nasdaq Stock Market indicating that the Nasdaq Listing
Qualifications Panel extended until August 13, 2002 the date by
which Owosso is required to make a public filing with the
Securities and Exchange Commission and Nasdaq evidencing
shareholders' equity of at least $7.0 million dollars in order
to avoid the delisting of Owosso's securities from the Nasdaq
SmallCap Market. The filing must contain a balance sheet, no
older than 45 days, which includes pro forma adjustments for any
significant events or transactions occurring on or before the
filing date.  Owosso has also been informed by Nasdaq that
unless the closing bid price of its common stock is at least
$1.00 per share on or before August 13, 2002, and sustains a
closing bid price of $1.00 per share for a minimum of ten
consecutive trading days thereafter, its securities will be
delisted.  However, if Owosso meets certain initial listing
criteria of the Nasdaq SmallCap Market, on or before August 13,
2002, according to current Nasdaq policy, Owosso will have an
additional 180 calendar day grace period to demonstrate
compliance with Nasdaq's $1.00 bid price requirement. Owosso
believes that the estimated pretax gain to be recognized by
Owosso in connection with the sale of its Motor Products
business will allow it to meet the Panel's balance sheet
requirements in addition to applicable initial listing criteria
by August 13, 2002.  Owosso can make no assurances, however,
that this will be the case.

Owosso is a manufacturer of engineered component motor products.

To receive additional information on Owosso Corporation visit
Owosso's Web site http://www.owosso.com


PACER: Improved Risk Profile Spurs S&P to Raise Rating to BB-
-------------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit
rating on Pacer International Inc., to double-'B'-minus from
single-'B'-plus. Ratings were removed from CreditWatch, where
they were placed May 17, 2002. The rating action reflects
Pacer's improved financial risk profile following its June 2002
initial public stock offering. Concord, California-based Pacer,
which provides intermodal and logistics services, has about $500
million of debt (including off-balance sheet leases).

"Ratings reflect Pacer's high (albeit declining) debt leverage
and exposure to cyclical pressures (especially in its logistics
business), offset by a solid niche position in the
transportation and logistics industry and a somewhat variable
cost structure," said Standard & Poor's credit analyst Lisa
Jenkins. Pacer's operations are centered around two key business
areas: the wholesale intermodal business (57% of 2001 net
revenues and 73% of operating income) and the retail logistics
business (43% of 2001 net revenues and 27% of operating income).
Pacer's intermodal business transports cargo containers stacked
two high on specially designed railcars. Its logistics services
include intermodal marketing, truck transportation brokerage,
freight forwarding, freight consolidation and handling, and
supply chain management services. Pacer's intermodal operations
benefit from contractual arrangements that result in a fair
amount of stability in operating results. Its increased emphasis
on logistics services over the past few years, however, has
increased its exposure to competitive and cyclical pressures. To
mitigate cyclical pressures to some extent, Pacer relies on
contracts and operating arrangements with rail carriers,
independent trucking operators, and leasing companies. A
significant portion of its equipment leases allow for
cancellation within three months or less. While its reliance on
leased equipment and contracts for the use of others' facilities
reduces Pacer's capital spending requirements, it also makes
Pacer more vulnerable to equipment shortages and service
disruptions by its partners.

Acquisitions, investments, and cyclical pressures will likely
limit upside rating potential. The company's somewhat variable
cost structure, its emphasis on cost cutting, and the stability
provided by contractual arrangements in the intermodal
operations should limit downside risk.


PACIFIC GAS: Cashes-Out 4,000 Small-Dollar Claims for $4.3 Mill.
----------------------------------------------------------------
Pacific Gas and Electric Company paid more than $4.3 million to
approximately 4,000 creditors holding valid claims of $5,000 or
less.  The U.S. Bankruptcy Court earlier approved PG&E's request
to pay this group of creditors.

In Pacific Gas and Electric Company's Chapter 11 case, more than
13,000 proofs of claims were filed.  The approximately 4,000
claims that were paid today resolve about one-third of the total
claims filed in the case.

Creditors also received interest accrued at the Federal Judgment
Rate on the allowed amount of the claim from April 6, 2001
through June 30, 2002.

"We are pleased to be able to pay these creditors early,
especially since many of them are individuals and small
businesses that we have worked with for many years," said Gordon
R. Smith, president and chief executive officer of Pacific Gas
and Electric Company.

PG&E requested this early payment to reduce the inconvenience on
individuals and small businesses and to simplify the claims
resolution process going forward.  By paying these claims, PG&E
will be able to focus its resources on the larger and more
complex claims.  PG&E estimates the total amount owed to
creditors is about $13.3 billion, and its proposed plan of
reorganization pays all valid claims in full with interest.


PACIFICARE HEALTH: Posts Improved 2nd Quarter 2002 Performance
--------------------------------------------------------------
PacifiCare Health Systems Inc. (Nasdaq:PHSY), announced that pro
forma net income for the second quarter ended June 30, 2002,
increased to $31.8 million, compared with pro forma net income
of $29.5 million for the second quarter of 2001.

Pro forma second quarter 2002 EPS excludes a previously
disclosed non-cash write-down of $18.3 million ($11.5 million
net of tax) in unamortized senior credit facility fees and
recapitalization advisory fees.

Including the charge, reported second quarter 2002 net income
was $20.3 million, compared with second quarter 2001 reported
earnings of $15.3 million.

Adjusting for the effect of the adoption of SFAS 142, which
eliminated the amortization of goodwill beginning Jan. 1, 2002,
last year's second quarter net income would have increased by
$15 million.

Operating income (less net investment income of $2.9 million and
exclusive of one-time charges of $18.3 million) totaled $66.7
million, an increase of 102% year-over-year. Second quarter 2001
operating income totaled $33.1 million (including a $14.8
million adjustment for the effect of SFAS 142, less investment
income of $32.7 million).

"The increase we achieved in operating income is a solid measure
of PacifiCare's turnaround progress, confirming the positive
impact of steps we've taken over the past 18 months to increase
the profitability of the company's health plans division and
specialty businesses," said Howard G. Phanstiel, president and
chief executive officer.

"The health plans division continued to benefit from improved
pricing and health-care cost controls and the culling of
unprofitable membership. This significantly increased health
plan operating profit by $45 million year-over-year. Included in
this overall very positive result are pre-tax losses amounting
to $43 million incurred by our Texas health plan.

"These losses were a result of additional payments to providers
and reserves established for claims previously adjudicated but
where final payment amounts remained unresolved pending further
review.

"Most significantly in the quarter, we made major progress in
restructuring and strengthening the company's balance sheet. We
extended our long-term debt through an amended senior credit
facility and a $500 million senior note offering and reduced
debt through a combination of payments out of cash flow from
operations and asset sales."

                   Revenue and Membership

Second quarter 2002 revenue of $2.8 billion was 6% below the
same quarter a year ago due to a 20% decrease in Medicare+Choice
membership and a 9% decrease in commercial HMO membership.
Partially offsetting the impact of the membership declines were
increases in commercial per member per month (PMPM) premium
yields of 15%, net of benefit buydowns and increases in senior
PMPM premium yields of 7%.

PacifiCare's medical membership was approximately 3.3 million on
June 30, 2002, down 12% year-over-year and 2% below the first
quarter of 2002. The decrease in commercial medical membership
was primarily attributable to the implementation of premium rate
increases, planned exits from unprofitable commercial markets
and the termination of contracts with higher-cost network
providers.

The decrease in Medicare+Choice membership was primarily due to
county exits and member disenrollment resulting from benefit
reductions the company implemented at the start of the year.

Other income, principally from the company's specialty
businesses, grew 19% from the second quarter of 2001, primarily
due to increased mail service revenues earned by Prescription
Solutions. Although total specialty company membership decreased
approximately 7% year-over- year, reflecting the overall decline
in medical membership noted above, Prescription Solutions'
unaffiliated membership increased 53% year-over-year.

Net investment income decreased $30 million from the year-ago
quarter. In addition to the impact of lower interest rates on
marketable securities yields and realized losses, the company
also wrote down impaired investments totaling approximately $13
million ($8 million net of tax, or $0.22 per diluted share),
which included WorldCom bonds and the company's investment in
MedUnite Inc.

                       Health-Care Costs

The consolidated medical loss ratio (MLR) in the second quarter
was 87.7%, 220 basis points lower than the MLR in the second
quarter last year and 110 basis points better than the first
quarter of 2002. The commercial MLR decreased 170 basis points
from the same quarter last year to 87.5% and was comparable to
the first quarter this year.

The year-over-year improvement was due primarily to premium rate
increases, which were partially offset by higher inpatient and
physician service costs and increased pharmacy costs. The senior
MLR, which includes both the company's Medicare+Choice plans and
its Medicare Supplement products, decreased 250 basis points
from the second quarter of 2001 to 87.8%, primarily due to
premium rate increases and benefit reductions implemented in
2002.

The ratio decreased 200 basis points on a sequential quarter
basis due to several factors, including continued positive
emerging health-care cost trends related to benefit changes made
at the beginning of the year, as well as the favorable impact of
seasonality and disease management programs that resulted in
lower-than-expected utilization.

           Selling, General & Administrative Expenses

Selling, general and administrative (SG&A) expenses totaled $310
million in the second quarter, a 5% increase from the year-ago
quarter.

Although work force reductions have been implemented in
conjunction with market exits and membership declines, the
company increased SG&A spending in 2002 on new product,
technology and marketing initiatives designed to spur the
resumption of commercial membership growth beginning in 2003 and
to enhance efficiency and productivity.

The combination of increased spending and the reduction in
premium revenues resulted in the SG&A ratio rising to 11.2%,
excluding net investment income. This was 120 basis points above
the 2001 second quarter and 30 basis points higher than the 2002
first quarter.

                     Other Financial Data

Medical claims and benefits payable totaled approximately $1.1
billion at June 30, 2002, comparable to the balance at March 31,
2002. Days claims payable for the second quarter increased by
0.8 days to 39.9 days compared with the prior quarter.

At June 30, 2002, days claims receipts on hand was approximately
5.7 days, 36% below the amount on hand a year ago and a decrease
of 5% from the first quarter due to continuing improvements in
operational effectiveness.

The IBNR component of medical claims and benefits payable
decreased by $30.4 million, primarily due to lower shared-risk
health-care costs in the Senior line of business.

Earnings before interest, taxes, depreciation and amortization
(EBITDA), as well as before the non-cash write-down of bank fees
discussed above, totaled $88.7 million in the 2002 second
quarter. This represents a 9% increase from EBITDA in the first
quarter of $81.6 million, which excluded the effect of one-time
charges and credits and the cumulative effect of a change in
accounting principle.

Free cash flow, defined as net income plus depreciation and
amortization, less capital expenditures, was approximately $36
million. The cash balance at the parent company averaged $110
million during the second quarter.

                    Balance Sheet Restructuring

Several previously announced transactions significantly
strengthened the company's balance sheet in the second quarter.
The company executed an agreement with its lenders to extend the
maturity date of its senior credit facility by two years, to
Jan. 2, 2005, conditioned upon PacifiCare reducing the existing
facilities by $250 million prior to Jan. 2, 2003.

The company also completed a private placement of $500 million
in high yield senior notes due in June 2009. The note offering,
which was raised from $200 million due to strong demand,
provided funds sufficient to ensure the two-year extension of
the senior credit facility. Additionally, funds were set aside
in a reserve account for the repayment of the FHP notes due in
September 2003.

During the second quarter, the company repurchased a total of
approximately $41 million in FHP notes, leaving an outstanding
balance of approximately $44 million. The company also repaid
more than $52 million in indebtedness under the senior credit
facility out of cash flows from operations and repaid another
$10 million from the sale of property.

As previously disclosed, the company also completed a draw under
its equity commitment arrangement with Acqua Wellington North
American Equities Fund Limited, resulting in the issuance of
420,720 shares of PacifiCare stock on May 2 for approximately $9
million.

                  New Business Developments

The company's health plans and specialty businesses have
recently succeeded in landing new business that is anticipated
to expand PacifiCare's revenues and membership base.

For example, Prescription Solutions has sold new business
covering approximately 438,000 lives unaffiliated with
PacifiCare's own health plans, including 250,000 Labor and Trust
members. Also, the company's newly formed Secure Horizons Senior
Solutions division has launched a strategic marketing
partnership with Reader's Digest Financial Services Inc.,
through which Secure Horizons will become the exclusive Medicare
Supplement product to be endorsed by Reader's Digest.

An initial mailing will occur in August and the partnership is
being fully rolled out in October. The company believes this is
a significant step in expanding its connection with seniors
across the nation, giving Secure Horizons access to Reader's
Digest's extensive direct marketing experience.

"The positive results from our efforts to control and improve
our core operations have positioned us to intensify our focus on
commercial membership growth by expanding our product line, our
quality initiatives and our marketing efforts," Phanstiel said.

Gregory W. Scott, executive vice president and chief financial
officer, added: "Looking ahead to the remainder of 2002, we are
maintaining our previously announced EPS guidance of $3.37 to
$3.47 on a pro forma basis and now feel more comfortable with
the high end of that range. This guidance includes our plans to
continue investing heavily in strategic initiatives that are
integral to our future growth."

PacifiCare Health Systems is one of the nation's largest health-
care services companies. Primary operations include managed care
products for employer groups and Medicare beneficiaries in eight
Western states and Guam serving approximately 3.3 million
members.

Other specialty products and operations include pharmacy benefit
management, behavioral health services, life and health
insurance, and dental and vision services. More information on
PacifiCare can be obtained at http://www.pacificare.com  

                        *    *    *

As previously reported, Fitch Ratings upgraded PacifiCare
Health System, Inc.'s existing bank and senior secured debt
ratings to 'BB' from 'BB-'. Concurrently, Fitch upgraded
PacifiCare's senior unsecured debt rating to 'BB-' from 'B+'.
The Rating Outlook is Stable. The rating action affects
approximately $860 million of debt outstanding.

The rating action reflects the significant improvement in
PacifiCare's capital structure following the successful sale of
$500 million 10.75% senior notes due June 2009, the reduction in
outstanding bank debt, and the extension in the maturity of the
company's remaining bank debt. The sale of the notes settled on
May 21, 2002 at 99.389 to yield proceeds of $497 million.


PENN TREATY: Gets Approval for Long-Term Care Sales in Florida
--------------------------------------------------------------
Standard & Poor's Ratings Services said that Penn Treaty
American Corp.'s (CCC-/Stable/--) July 30, 2002, announcement of
an agreement via consent order with the Florida Insurance
Department, whereby it is authorized and approved to immediately
recommence sales of its long-term care insurance products in
Florida through its largest subsidiary insurer, Penn Treaty
Network America Insurance Co. (PTNA)(B-/Stable/--), will have no
effect on the ratings at this time. Florida has historically
been the company's largest point of production, accounting for
about 25% of past sales volume.

On May 23, 2002, Standard & Poor's stated that it would revise
its outlook on PTNA to positive should it receive approval from
the California and Florida state insurance departments to
underwrite new long-term care insurance in those states. The
company has not yet received such approval from the California
Insurance Department. Standard & Poor's will continue to monitor
PTNA's progress as it seeks approval from additional states to
underwrite new long-term care insurance business.


PETROLEUM GEO: Fitch Slashes Debt Ratings to Lower-B Level
----------------------------------------------------------
Fitch Ratings has downgraded Petroleum Geo-Services ASA (PGO)
senior unsecured debt rating to 'B' from 'BBB-' and downgraded
PGO's trust preferred securities to 'B-' from 'BB+'. The Rating
Outlook has been changed to Negative from Stable.

The downgrade of PGO's ratings is subsequent to the announcement
that the merger with Veritas has been terminated. PGO's
liquidity situation, access to capital and ability to generate
proceeds from asset sales is the justification for the
downgrade. As of June 30, 2002, PGO had approximately $65
million of cash on hand and only $70 million available though
its credit facility. The downgrade of PGO's credit ratings could
exacerbate its tight liquidity situation as some leases may
require collateral in the form of cash. In addition to this
potential cash requirement, management indicated on its
quarterly conference call that it planned on refinancing roughly
half of its $930 million of maturing debt through its banks
and/or the high yield market. Fitch is skeptical that management
will be able to follow through with this plan given the current
yield on its existing debt. Finally, in light of the difficulty
with which management has had in divesting its Atlantis assets,
Fitch has a cautious view of future asset sales used to reduce
debt. The downgrade also reflects the potential for a prolonged
weak seismic pricing environment. While PGO has a good seismic
backlog, the industry continues to experience weakness in the
demand for marine seismic data. In the near term this could
delay PGO's efforts to reduce the company's debt obligations
beyond the level expected from the sale of non-core assets.

PGO is a technologically focused oilfield service company
principally involved in two businesses: geophysical seismic
services and production services. PGO acquires, processes,
manages and markets 3D, time-lapse and multicomponent seismic
data. This data is used by oil and gas companies in exploration
for new reserves, development of existing reservoirs and
management of producing oil and gas fields. In its production
services business PGO own and operates four FPSOs and operates
numerous offshore production facilities for oil and gas
companies to produce from offshore fields more cost effectively.


PHYCOR INC: Emerges from Chapter 11 Bankruptcy Effective July 30
----------------------------------------------------------------
PhyCor announced that it successfully emerged from Chapter 11
bankruptcy reorganization on July 30, 2002, after satisfying the
conditions necessary to consummate PhyCor's plan of
reorganization. The United States Bankruptcy Court for the
Southern District of New York confirmed the plan of
reorganization on July 19, 2002. PhyCor filed for reorganization
relief under Chapter 11 of the United States Bankruptcy Code on
January 31, 2002. PhyCor has changed its name to Aveta Health,
Inc.

Aveta Health, which remains headquartered in Nashville, is a
healthcare risk management company that provides services to
630,000 individuals in California, Illinois, Tennessee and
Kansas. Aveta Health's North American Medical Management
subsidiaries arrange for the provision of healthcare services
through their owned and affiliated independent physician
associations and physician hospital organizations. Aveta Health
also provides contract management services to hospital-owned
physician groups through its Pivot Health division and
consulting and related services to physician groups through its
Medical Group Practice Systems division.


PINNACLE: Expects to Close Fortress Purchase Pact by Aug. 20
------------------------------------------------------------
Pinnacle Holdings Inc., (OTC Pink Sheets: BIGTQ) together with
its wholly owned subsidiaries, Pinnacle Towers Inc., Pinnacle
Towers III Inc. and Pinnacle San Antonio LLC, today announced
that the United States Bankruptcy Court for the Southern
District of New York entered an order Tuesday confirming their
amended joint plan of reorganization previously filed with the
Court.

It is currently contemplated that the Plan will be funded by two
new sources of capital: (1) an equity investment of up to $205.0
million by Fortress Investment Group and Greenhill Capital
Partners pursuant to the terms of the Securities Purchase
Agreement entered into as of April 25, 2002, and (2) an
approximately $340.0 million new credit facility.  Pinnacle and
the Investors continue to negotiate a proposed credit facility
with prospective lenders.  In connection with the consummation
of the transactions contemplated by the Purchase Agreement,
Pinnacle Holdings will be merged into a newly formed Delaware
corporation formed by the Investors with New Pinnacle being the
surviving corporation.

As previously announced, under the terms of the Purchase
Agreement with the Investors, Fortress will purchase up to
approximately 13,735,000 shares of common stock of New Pinnacle
and Greenhill will purchase up to approximately 6,765,000 shares
of common stock of New Pinnacle.  The Purchase Agreement
provides for the cancellation of the Senior Notes in exchange
for up to $114.0 million (or $350.77 per $1,000 par value bond)
in cash or, at the holder's election, a combination of cash and
up to 49.9% of New Pinnacle's outstanding common stock.  The
number of Investor Shares (and hence their cash investment) will
be proportionately decreased by the number of shares purchased
by holders of the Senior Notes.

The Purchase Agreement also provides for the cancellation of the
Convertible Notes in exchange for up to $500,000 in cash and
five-year warrants to purchase up to approximately 205,000
shares of New Pinnacle's common stock at approximately two times
the price of the Investor Shares. Convertible Note holders can
double this amount to a total of $1.0 million in cash and
warrants to purchase 410,000 shares, representing approximately
2% of New Pinnacle's equity capitalization, if the Convertible
Note holders agree to give certain releases.  The Purchase
Agreement further provides for cancellation of the outstanding
shares of Pinnacle common stock.  Former stockholders and
plaintiffs in a stockholder class action shall receive five-
year warrants to purchase up to 102,500 shares of New Pinnacle
common stock (representing approximately 1/2% of New Pinnacle's
equity capitalization) at approximately two times the price of
the Investor Shares.  This amount can be doubled to 205,000
shares, representing approximately 1% of New Pinnacle's
capitalization, if the stockholders agree to give certain
releases.  Trade and other creditors will be paid in full in the
ordinary course.

Pinnacle currently is working towards trying to close the
transactions contemplated by the Purchase Agreement on or before
August 20, 2002.  After such date, votes in favor of the Plan
could be withdrawn, which could result in the need to re-solicit
votes on the Plan.  The specific terms of a new credit facility
are currently being negotiated, and the ability of Pinnacle to
close the transactions contemplated by the Purchase Agreement is
subject to satisfying all of the conditions necessary to
consummate a new credit facility and the transactions
contemplated by the Purchase Agreement.  If certain of the terms
of the new credit facility were to vary materially from those
currently contemplated by Pinnacle, Pinnacle might need to amend
the Plan and/or re-solicit votes in favor of the Plan.  The
Purchase Agreement contains customary terms and conditions,
including exclusivity provisions that generally prohibit
Pinnacle from discussing or negotiating an alternative
restructuring transaction, unless Pinnacle first receives an
unsolicited bona fide proposal regarding such an alternative
transaction.  Pinnacle cannot enter into any agreement providing
for an alternative transaction, except in certain circumstances
where Pinnacle's board of directors determines that the
alternative transaction would provide a higher value to Pinnacle
than the transaction contemplated by the Purchase Agreement.  If
Pinnacle consummates such an alternative transaction, under
certain circumstances, Pinnacle would be required to pay the
Investors a break-up fee of up to $12 million.

Steven R. Day, Pinnacle's Chief Executive Officer, said, "The
Court's entering of the confirmation order represents a
significant milestone in our goal of implementing our previously
announced restructuring plan.  I am extremely pleased that we
are approaching final closure of the bankruptcy process.  I
continue to be appreciative of the cooperation and support or
our employees, customers, vendors and creditors."

Pinnacle is a provider of communication site rental space in the
United States and Canada.  At March 31, 2001, Pinnacle owned,
managed, leased, or had rights to in excess of 4,000 sites.  
Pinnacle is headquartered in Sarasota, Florida.  For more
information on Pinnacle visit its Web site at
http://www.pinnacletowers.com   

Pinnacle Holdings Inc.'s 10% bonds due 2008 (BIGT08USR1) are
trading at 26 cents-on-the-dollar, DebtTraders reports. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=BIGT08USR1
for real-time bond pricing.


PINNACLE TOWERS: Turns to Gordian Group for Financial Advice
------------------------------------------------------------
Pinnacle Towers III Inc., and its debtor-affiliates sought and
obtained approval from the U.S. Bankruptcy Court for the
Southern District of New York to retain Gordian Group, LP as
their financial advisor.

Gordian Group will provide financial advice and investment
banking services relating to a capital restructuring, including:

     a) evaluating and developing a strategy for Debtors in
        connection with a financial transaction including
        assisting Debtors in identifying and evaluating a
        prospective party;

     b) representing the Debtors in discussions and negotiations
        with various third parties, including creditors,
        potential investors and acquisition targets;

     c) negotiating and structuring of financial aspects of a
        proposed Financial Transaction;

     d) reviewing and evaluating Debtors' business plan, debt
        capacity and liquidation analysis;

     e) providing general restructuring advice;

     f) advising the Board of Directors of Debtors with respect
        to a Financial Transaction; and

     g) testifying in connection with any bankruptcy proceeding.

The Debtors will pay Gordian Group:

     a) a $15,000 monthly fee; and

     b) $4,000,000 minus the sum of the Monthly Fees previously
        paid by Debtors to Gordian Group.

Pinnacle Towers III, Inc., the leading independent providers of
wireless communications site space in the United States, filed
for chapter 11 protection on May 21, 2002.  Peter Alan Zisser,
Esq., and Sandra E. Mayerson, Esq., at Holland & Knight, LLP
represent the Debtors in their restructuring efforts. As of May
31, 2002, the Debtors listed $1,002,675,000 in assets and
$931,899,000 in liabilities.


SOUTHEAST BANKING: Trustee Makes $23MM Distribution to Creditors
----------------------------------------------------------------
The bankruptcy trustee for Southeast Banking Corporation has
made a further Interim Distribution of over $23 million to
creditors and bondholders in the company's Chapter 7 bankruptcy
case, to pay all of the timely-filed allowed claims in full,
without interest accruing since the bankruptcy filing. With this
payment, nearly $360 million in cash has been paid to creditors,
most of whom are holders of subordinated bonds issued by
Southeast over a period of several years prior to the bankruptcy
filing.

The distribution was made by Jeffrey H. Beck of J Beck &
Associates, Inc., of Boca Raton, the bankruptcy trustee and
attorney who was appointed successor trustee in the case in
April, 1998.  Mr. Beck also serves as Successor Agent to the
Federal Deposit Insurance Corporation as Receiver for the failed
Southeast Bank, N.A.  It was the seizure of Southeast Bank, N.A.
and its sister institution by federal and state regulators that
prompted Southeast Banking Corporation to file for Chapter 7
bankruptcy on September 20, 1991.

The bankruptcy estate had already made six prior Interim
Distributions to creditors and bondholders since 1993. The
present payout, previously approved by Bankruptcy Judge Paul G.
Hyman, Jr., as the second installment to the Sixth Interim
Distribution, leaves sufficient funds in both the Receivership
and the bankruptcy estate to pay late-filed and disputed claims,
anticipated costs of administration and litigation, and tens of
millions of dollars in interest accrued on all allowed claims in
the eleven years since the bankruptcy filing.

"We are delighted to have reached a stage in a very long case,
at which all creditors with timely filed and allowed claims have
received a full return of their principal," said Mr. Beck. "We
now proceed with the task of recovering and clearing additional
funds to pay interest that has accrued on those claims since the
bankruptcy case was filed in 1991."

The assets of the Southeast bankruptcy estate in 1991 consisted
of real estate and corporate investments, including the
ownership of Southeast Bank, N.A., claims against third parties,
claims in the receivership of Southeast Bank, N.A., tax refunds,
the reversionary interest in Southeast Banking Corporation's
retirement plan and other miscellaneous assets. Most of these
assets have now been liquidated and the proceeds reserved or
distributed. Remaining assets include real estate holdings in
Jacksonville, Florida and potential unresolved third party
claims.

"The creditors and the estate have been well served by a highly
competent and motivated group of professionals and staff members
who deserve credit for this most unusual and successful result,"
said Mr. Beck. "As with all substantial and successful
undertakings, results are obtained by teamwork and
professionalism. Such is the case in the Southeast Case as
well."

Professionals employed to assist in the liquidation of these
assets and administration of the bankruptcy estate have
included: Mark Bloom, Hilarie Bass, John Hutton, Luis Salazar
and others of the law firm Greenberg Traurig of Miami, who have
acted as general counsel and prosecuted litigation matters since
the estate's inception in September, 1991; Michael Josephs,
Tamara McKeown, Joseph Beasley and others of the law firm
Josephs, Jack, Miranda & McKeown of Miami, who have acted as
special litigation counsel since 1998; Kendall Coffey, Carla
Barrow and others of the law firm Coffey & Wright of Miami, who
have acted as special litigation and appellate counsel since
1996; James McCarthy, Arley Finley, Gregory Taylor and others of
the law firm Diamond, McCarthy, Taylor and Finley of Dallas and
Austin, Texas, who have acted as special litigation counsel
since 1998; Emmet Bondurant, Frank Lowery and others at the law
firm Bondurant, Mixson of Atlanta, Georgia, who have acted as
special litigation and appellate counsel since 1998; David
Rogers, Lawson Green and others at the law firm McDermott, Will
& Emery of Washington, D.C., who have acted as special employee
benefits and ERISA counsel to the estate since 1992; Soneet
Kapila, Maggie Smith, Sherry Bennett, Lesley Johnson and others
of the accounting firm Kapila & Co. of Fort Lauderdale, who have
acted as the estate's accountants and tax advisors since 1998;
Stephen Busey and others of the law firm Smith, Hulsey & Busey
of Jacksonville, who have acted as special litigation counsel to
the estate's subsidiary companies; T. R. Hainline, Susan
McDonald and others of the law firm Rogers Towers of
Jacksonville, who have acted as zoning and land-use counsel to
the estate's subsidiary companies; Douglas Miller, Peter Ma and
others of the engineering firm of England, Timms & Miller of
Jacksonville, who have acted as engineering consultants to the
estate's subsidiary companies; Jerry Malcolm and others of the
accounting firm PricewaterhouseCoopers of Miami, who have acted
as special tax accountants for the estate since 1996; Kenneth
Robinson and others of the law firm Rice, Pugatch, Robinson &
Schiller of Miami, who have acted as special litigation counsel
for the estate since 1996; and Craig Budner and others of Hughes
& Luce of Dallas, Texas, who have acted as special litigation
counsel to the estate since 1998.

Staff members employed by the estate include Daniel Owen, who
has served as chief financial officer since 1998; Karen Madsen,
who acted as employee benefits and retirement plan administrator
from 1991 to 2001; and Marilyn Davis, who served as
paralegal/administrative assistant from 1998 to 2001. Since his
appointment in 1998, Mr. Beck has employed Iris Mendoza in his
own office as his assistant for financial administration on the
Southeast case. Previous trustees of the Southeast estate
include William A. Brandt, Jr., James S. Feltman and Jules I.
Bagdan, all of Miami.


SPECIAL METALS: Bank Group Agrees to Waive Technical Default
------------------------------------------------------------
Special Metals Corporation (OTC: SMCXQ) did not meet its June
30, 2002 cumulative sales revenue covenant contained in its
Postpetition Credit Agreement but has obtained the agreement of
its bank group to waive the technical default.

The Company's revenue for the period from April 1, 2002 through
June 30, 2002 was $140.18 million, which was $2.89 million less
than the amount required by the terms of the credit agreement at
June 30, 2002. Special Metals met the five remaining financial
covenants for the month of June. In addition, the Company's
lenders agreed to a prospective waiver of the cumulative sales
revenue covenant for July 31, 2002.

The Company continues to maintain substantial cash resources
and, other than obtaining various letters of credit of
approximately $3.3 million, has not drawn on its availability
under the $60 million postpetition revolving credit facility. In
addition, the Company does not anticipate a need in the near
term to borrow funds under the credit facility.

Separately, Special Metals announced that the U.S. Bankruptcy
Court has approved a 90-day extension of the period in which the
Company and its U.S. subsidiaries, as the debtors-in-possession,
retain the exclusive right to file plans of reorganization. The
order extends the exclusivity period to November 1, 2002.

The Court also established September 30, 2002 as the bar date
for all potential creditors to assert claims against the Company
and its U.S. subsidiaries that arose before March 27, 2002.
Notice of the bar date and proof of claim forms were distributed
to all stakeholders and potential claimants of the Company on
July 26, 2002.

Special Metals is the world's largest and most-diversified
producer of high-performance nickel-based alloys. Its specialty
metals are used in some of the world's most technically
demanding industries and applications, including: aerospace,
power generation, chemical processing, and oil exploration.
Through its 10 U.S. and European production facilities and a
global distribution network, Special Metals supplies over 5,000
customers and every major world market for high-performance  
nickel-based alloys.


SPEIZMAN INDUSTRIES: SouthTrust Agrees to Forbear Until Year-End
----------------------------------------------------------------
Speizman Industries, Inc. (Nasdaq: SPZN), has entered into a
Fourth Amendment and Forbearance Agreement relating to its
credit facility with SouthTrust Bank.  The credit facility as
amended provides a revolving credit facility up to $13.0 million
and an additional line of credit for issuance of documentary
letters of credit up to $6.0 million.  The availability under
the combined facility is limited to a borrowing base as defined
by the bank.  The Company, as of July 31, 2002, had borrowings
with SouthTrust Bank of $5.6 million under the revolving credit
facility and had unused availability of $2.6 million.  The
Fourth Amendment requires monthly compliance on certain EBITDA
targets through December 2002.  The SouthTrust facility expires
on December 31, 2002.

Paul R.M. Demmink, Vice President and Chief Financial Officer,
said, "We are pleased that SouthTrust extended our facility
through December 31, 2002. We appreciate that SouthTrust
continues to be our partner as we pursue a longer term financing
solution designed to meet our credit needs for the next several
years."

Speizman Industries is a leader in the sale and distribution of
specialized industrial machinery, parts and equipment.  The
Company acts as exclusive distributor in the United States,
Canada, and Mexico for leading Italian manufacturers of textile
equipment and is a leading distributor in the United States of
industrial laundry equipment representing several United States
manufacturers.


SWAN TRANSPORTATION: Exclusive Period Extended until August 17
--------------------------------------------------------------
By order of the U.S. Bankruptcy Court for the District of
Delaware, Swan Transportation Company obtained an extension of
its exclusive periods.  The Court gives the Debtor, until August
17, 2002m the exclusive right to file its plan of reorganization
and until November 29, 2002 to solicit acceptances of that Plan
from creditors.

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.


TANDYCRAFTS: Committee Balks at Proposed Kmart Receivable Sale
--------------------------------------------------------------
The Official Committee of Unsecured Creditors of Tandycrafts,
Inc., and its debtor-affiliates objects to the Debtors' motion
to sell certain trade receivable owed by Kmart Corporation in
the secondary claims trading market.  The Kmart Receivable
allegedly consists of liabilities scheduled by Kmart as
undisputed in their pending chapter 11 case in the aggregate
amount of $1,717,415.10 plus an additional $2,753,677.00, as
reflected in the books and records of the Debtors.

The Committee complains to the Court that the Debtors have
failed to provide adequate information regarding the contacts
and solicitations received from claims traders for the Kmart
Receivable.  The Committee asserts that it needs to make a
meaningful analysis to determine whether the sale of the Kmart
Receivable would be in the best interests of the estates and the
unsecured creditors -- and lacks the information to do so.  

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. Michael L. Vild, Esq., at The Bayard Firm and Jeffrey
D. Prol, Esq., at Lowenstein Sandler PC serve as counsel to the
Official Unsecured Creditors Committee. When the Company filed
for protection from its creditors, it listed assets of
$64,559,000 and debts of $56,370,000.


THOMSON KERNAGHAN: Regulator Explains Order Against Ex-Chairman
---------------------------------------------------------------
The Ontario Securities Commission has released reasons for its
order dated July 8, 2002, issued against Mark Edward Valentine.
Valentine was the Chairman and largest shareholder of Thomson
Kernaghan & Co. Ltd., which is now in bankruptcy.

On June 17, 2002 the Commission issued a temporary order
suspending Valentine's registration as a stockbroker, and
requiring him to cease trading in securities for a period of 15
days. On July 2 and July 8, 2002, the Commission convened a
hearing to consider whether the temporary order should be
extended. At the conclusion of the hearing, the Commission
issued an order extending the temporary order until at least
January 31, 2003, to allow Staff to continue their investigation
of Valentine's actions.

In its reasons for decision, the Commission reviewed the
evidence presented concerning Valentine's role as the Registered
Representative for four private funds, namely the Canadian
Advantage Limited Partnership, Advantage (Bermuda) Fund Ltd., VC
Advantage Fund Limited Partnership and the VC Advantage
(Bermuda) Fund Ltd. It also considered evidence concerning
Valentine's role in the financing of JAWZ Inc.

The Commission found that it was "satisfied that Staff has
provided sufficient evidence of conduct that may be harmful to
the public interest and, accordingly justifies an extension of
the temporary order. There is little doubt that additional time
is required to complete the investigation and, unless the
temporary order is extended, there is a reasonable likelihood
that Valentine's alleged objectionable conduct may continue.
Such conduct would present a serious risk to the integrity of
Ontario's capital markets as well as to the protection of the
public interest".

Copies of the reasons for decision are available on the
Commission's Web site at http://www.osc.gov.on.caor from the  
Commission's offices at 20 Queen Street West, Toronto.


TRICO STEEL: Gets Okay to Maintain Exclusivity Until November 18
----------------------------------------------------------------
By order of the U.S. Bankruptcy Court for the District of
Delaware, Trico Steel Company LLC obtained a fourth extension of
its exclusive periods.  The Court gives the Debtor, until
November 18, 2002, the exclusive right to file its plan of
reorganization and until January 20, 2003, to solicit
acceptances of that Plan.

Trico Steel Company, LLC filed for chapter 11 protection on
March 27, 2001 in the U.S. Bankruptcy Court for the District of
Delaware. Edward J. Kosmowski, Esq., and Michael R. Nestor,
Esq., at Young Conaway Stargatt & Taylor represent the Debtor in
its restructuring effort.


USG CORP: PI Committee Seeks Okay to File Affidavit Under Seal
--------------------------------------------------------------
The Official Committee of Asbestos Personal Injury Claimants
seeks the Court's authority to file under seal Mark A.
Peterson's Affidavit, which was attached to their response to
USG Corporation and its debtor-affiliates' Motion for Entry of a
Case Management Order.

Matthew G. Zaleski, III, Esq., at Campbell & Levine, in
Wilmington, Delaware, explains that the Peterson Affidavit
recites information contained in documents provided by USG
Corporation and W.R. Grace & Co.  The documents were designated
as confidential.  Naturally, the PI Committee wants the
Affidavit filed under seal to protect the Debtors' and W.R.
Grace's interest in the confidential, commercial information and
its agreement to maintain the confidentiality of the information

Section 107(b) of the Bankruptcy Code provides that:

    "On request of a party in interest, the bankruptcy court
    shall, and on the bankruptcy court's own motion, the
    bankruptcy court may;

    (1) protect an entity with respect to a trade secret or
        confidential research development, or commercial
        information."

Bankruptcy Rule 9018 also provides that:

    "On motion or on its own initiative, with or without notice,
    the court may make any order which justice requires:

    (1) to protect the estate or any entity in respect of a
        trade secret or other confidential research,
        development, or commercial information,

    (2) to protect any entity against scandalous or defamatory
        matter contained in any paper filed in a cased under the
        Code, or

    (3) to protect governmental matters that are made
        confidential by statute or regulation."

Mr. Zaleski argues that the protective order requested is the
least intrusive means of protecting the integrity of the
judicial process, protecting legitimate confidential commercial
information, and fostering the creation of a full and fair
record for the Court's adjudication of disputes.  "It is a long-
standing practice in the federal courts for relevant evidence to
be received at trial in camera, so as to protect the non-public
character of qualified material while allowing the Court to
perform its adjudicative functions," Mr. Zaleski points out.

The PI Committee recognizes the Debtors' and W.R. Grace's
interest in preventing the information from becoming known to
their competitors and thereby jeopardizing the Debtors' and W.R.
Grace's reorganization efforts. (USG Bankruptcy News, Issue No.
30; Bankruptcy Creditors' Service, Inc., 609/392-0900)


VERITAS DGC: S&P Affirms BB+ Rating Following Merger Termination
----------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its double-'B'-plus
corporate credit rating on Houston, Texas-based Veritas DGC Inc.
The ratings are removed from CreditWatch with positive
implications, where they were placed on November 27, 2001
following the company's announced merger with Petroleum Geo-
Services ASA. The outlook is stable.

Veritas is the third-largest provider of seismic services to the
petroleum industry with approximately $135 million of
outstanding debt.

"The ratings affirmation and removal from CreditWatch results
from the termination of the merger with PGO," noted Standard &
Poor's credit analyst Daniel Volpi. "On July 30, 2002, Veritas'
Board of Director's withdrew its support for the merger with
PGO," he continued.

The combination of Veritas and PGO was expected to benefit the
industry by reducing the competitive landscape to two large
players. Standard & Poor's is concerned that Veritas may face an
intensified pricing environment as a result of PGO's precarious
financial condition.

Veritas is conservatively capitalized at roughly 20% debt to
capital as of April 30, 2002 and debt to EBITDA is likely to
remain around 1.0 times. Interest coverage measures are expected
to remain strong at above 8.0x. Investment in the company's
multiclient library and fleet additions during 2002 results in
an EBITDA-to-interest plus capital expenditures ratio below
1.0x. However, reduced future multiclient expenditures and
completion of the vessel program should result in modest free
cash flow in the near- to medium-term. Liquidity is strong with
$93 million available on the company's revolving credit facility
as of April 30, 2002, and the nearest maturity is its $135
million senior unsecured notes due in October 2003.

The stable outlook reflects expectations that Veritas will
continue to maintain a conservative financial profile.


WARNACO GROUP: Has Until October 31 to Decide on Milford Lease
--------------------------------------------------------------
For the fourth time, The Warnaco Group, Inc., its debtor-
affiliates, and Crown Milford LLC agree to extend the period
within which the Debtors may assume or reject their Office Lease
at 470 Wheeler Road in Milford, Connecticut with Crown Milford.  
The salient terms of their Court-approved Stipulation are:

  (a) The Stipulation is effective July 23, 2002;

  (b) The time to assume or reject the Milford Lease is further
      extended through and including October 31, 2002 without
      prejudice to the Debtors' rights to seek further
      extension or Milford's right to object;

  (c) In the event that the Debtors seek to reject the Milford
      Lease on or before October 31, 2002, the Debtors shall
      continue to fulfill all their administrative obligations
      under the Milford Lease, as the case may be, including,
      without limitation, timely payment of rent, until the
      later of:

          (i) the date of the entry of the order approving the
              rejection;

         (ii) the rejection effective date set forth in the
              order approving the rejection;

        (iii) the 90th day after receipt of notice of rejection
              by counsel of Milford, whether or not the Debtors
              retain possession of the property subject to the
              Milford Lease for the entire 90 days; and

         (iv) the date the Debtors surrender the leased
              property. (Warnaco Bankruptcy News, Issue No. 29;
              Bankruptcy Creditors' Service, Inc., 609/392-0900)  


WASH DEPOT: Gets Authority to Pay Hopkins for its 59th Appraisal
----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware gave its
stamp of approval to Wash Depot Holdings, Inc., and its debtor-
affiliates' application for a supplement order referring to the
59th appraisal by HVS, Inc. (d/b/a Hopkins Valuation Services).

The Debtors relate that pursuant to the Court-approved
Engagement Agreement, Hopkins Valuation was hired to appraise 58
Facilities in exchange for a $2,500 per Facility fee.

The company needed the going concern value to reflect the values
of particular stores to the enterprise as a whole.  The Company
requested Hopkins Valuation to prepare a 59th appraisal report,
which estimated the enterprise value of the Company as a whole.
The Court authorizes the Debtors to pay Hopkins Valuation
$10,000 for this additional valuation.

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. The Company's obligations
total approximately $120 million of secured or partially secured
loans owed primarily to financial institutions, unsecured trade
debt of approximately $4.5 million and other unsecured
obligations of approximately $7.5 million.  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.


WHEELING-PITTSBURGH: Court Okays CDGG as Debtor's Fin'l Advisors
----------------------------------------------------------------
Ira Bodenstein, United States Trustee for Region 9, observes
that since filing these cases, Wheeling-Pittsburgh Steel Corp.,
and its debtor-affiliates have retained the services of numerous
financial advisors, investment bankers, accountants and
restructuring consultants.  Interim fees and expenses currently
pending total $2,344,635.24.

On behalf of the U.S. Trustee, Andrew R. Vara, Esq., in
Cleveland, Ohio, points out that the WPSC's April Operating
Report discloses a $4,481,452 net operating loss.  Since the
Petition Date, operating losses total $358,726,742 while WPSC
incurred $18,054,519 in professional fees.  Now, the Debtors
seek to increase its payment of professional fees through
Conway, Del Genio, Gries & Co., LLC's retention.  While Debtors
indicate the total fees payable to CDGG will be capped at
$3,000,000, they do not indicate or identify any available
sources of cash for payments to CDGG.

Furthermore, the Debtors do not explain or assess the impact the
CDGG fees will have on the bankruptcy estate.  Given the
staggering post-petition operating losses sustained by this
estate and the professional fees incurred thus far, Mr. Vara
says, the Debtors "must offer compelling justification" to add
yet another professional person's fees.  The Debtors must also
address whether funds even exist to pay the proposed fees to
CDGG.

                       The Indemnification

Professionals retained under the Bankruptcy Code are
fiduciaries. Bankruptcy courts have consistently ruled that a
fiduciary should not be relieved of the consequences of her or
his actions through an indemnification clause.  In this
instance, the indemnification clause in the engagement letter
contains no limitation on the financial liability that may be
imposed on the bankruptcy estate.

While the UST recognizes that Judge Bodoh has permitted similar
indemnification provisions in these cases, the UST asserts that
an indemnification provision would place an undefined and
unlimited expense burden on a case already facing dire financial
circumstances. At this stage of the case, an indemnification
provision should be excluded "from the universe of reasonable
terms and conditions" defined by the Bankruptcy Code.

The Debtors have not sufficiently explained the necessity for
yet another financial advisor.  Given the number of
professionals employed in this case, it should be incumbent upon
the Debtors to:

    (a) detail the services now being provided by each entity;

    (b) explain the necessity for the continued retention of
        each entity;

    (c) estimate the monthly administrative expense burden posed
        by the retention of each entity;

    (d) indicate whether the Debtors believe the estate is
        administratively solvent; and

    (e) justify the need for imposing one more advisor upon
        this estate.

Mr. Vara contends that the Debtors' failure to answer these
questions establishes cause to deny the CDGG Application.

                    Unsecured Committee Objects:
                      Too Much and No Review

The Official Committee of Unsecured Trade Creditors joins the
U.S. Trustee in asking that this Application be denied.  
According to Michael A. Gallo, Esq., at Nadler Nadler & Burman
Co., LPA, in Youngstown, Ohio, the Trade Committee has been
advised that CDGG will work closely with RBC Dain in assisting
the Debtors to procure exit financing before the Emergency Steel
Loan Guaranty Board, and with additional post-confirmation
financing.  To that end, the Trade Committee does not object to
the retention of CDGG per se.  The Trade Committee is also
advised that the Debtors sought to re-engage Rothschild, its
previously retained investment bankers, but that request "was
rebuffed".  The Trade Committee believes that, while the Debtors
previously retained Rothschild and PwC Securities as bankers,
neither is providing the Debtors with investment banking
services at this time.

                  The Restructuring Fee Is Too High

The Trade Committee does object, however, to the $3,000,000
Restructuring Fee, which is to be automatically payable upon the
effective date of a plan of reorganization.  The Trade Committee
believes that, in light of recent positive developments in the
steel industry since the enactment of the Section 201 Tariffs in
March, the Debtors, if they were to be successful, would likely
effectuate a restructuring generally within the next six to
eight months. Accordingly, the payment of a $3,000,000
Restructuring Fee, even with the monthly credits, is excessive.

The Trade Committee believes that any order entered with respect
to CDGG's retention should clarify that its fees, including the
Restructuring Fee, will be reviewed under the reasonableness
standard of the Bankruptcy Code.  In addition, the proposed
retention order should include a provision that reserves the
Trade Committee's right to object to the reasonableness of
CDGG's fees, including the Restructuring Fee, at the appropriate
time.

                 The Noteholders' Committee Objects:
                  Focus on Sale; Too Much Money!

The Official Noteholders' Committee is not objecting to the
overall retention because it is hopeful that CDGG will provide
beneficial restructuring advice and will undertake its
responsibilities with respect to the sale process on a timely
basis.

However, the Noteholders' Committee does object to the
$3,000,000 Restructuring Fee, which is automatically payable
upon the effective date of a plan.  The Noteholders' Committee
does not believe that there should be any fixed Restructuring
Fee or any presumption of an entitlement by CDGG to the
$3,000,000 payment.  "It is impossible at this point to tell
whether the Restructuring Fee will be justified under the
circumstances," Lee D. Powar, Esq., at Hahn Loeser & Parks, in
Cleveland, Ohio, notes.  Rather, Mr. Powar asserts that CDGG
should be free to make an application to Judge Bodoh for the
Restructuring Fee at the conclusion of their engagement, and any
award should be made by Judge Bodoh based on the facts and
circumstances existing at that time with respect to the outcome
of the case and CDGG's contributions to restructuring.

Regardless of whether the fixed Restructuring Fee remains in the
retention agreement, Mr. Powar says, the Noteholders' Committee
and all parties-in-interest should retain their rights to object
to the reasonableness of the CDGG's fees when it is brought to
the Court for consideration.

                CDGG's Makes Additional Disclosures

In response to these objections, Robert P. Conway discloses that
CDGG has connections with Tyco International, GMAC Business
Cr4edit, IBJ Whitehall Business Credit, Congress Financial
Corporation, and GE Capital Corporation, lenders under the
Debtors' DIP Financing.  Mr. Conway says that that CDGG has
provided, and likely will continue to provide, services
unrelated to the Debtors' cases for some of these core
parties-in-interest.  Mr. Conway assures the Court that none of
these services will impair the Firm's "disinterestedness" in
Wheeling-Pittsburgh's chapter 11 cases.

                         *     *     *

At the hearing on this Application, the Noteholders' Committee
and the Trade Committee withdrew their objections.  Judge Bodoh
lost no time overruling the U.S. Trustee's objection and
granting the Application. But in deference to the Committees'
objection, Judge Bodoh orders that any compensation to CDGG,
including the Restructuring Fee, would be subject to his review
under the terms and provisions of the Bankruptcy Code.

As previously reported, CDG will provide such specific services
for the Debtors as CDG and the Debtors shall deem appropriate
and feasible in order to advise the Debtors in course of these
Chapter 11 cases, including:

   (a)  Restructuring Services:

        (i)  Performing general due diligence needed to evaluate
             the WPC's existing business plan;

       (ii)  Providing a valuation of the Debtors;

      (iii)  Assisting the Debtors, as necessary, in managing
             the Chapter 11 process with the goal of developing
             a confirmable plan of reorganization for the
             Debtors;

       (iv)  Advising the Debtors in all financial matters
             related to the structuring of and negotiations
             regarding a plan of reorganization;

       (v)   Rendering expert testimony, as necessary,
             concerning the valuation of the Debtors, the
             feasibility of a plan of reorganization and other
             matters; and

   (b)  Divestiture Services:

        (i)  Evaluating the sale process for WPC and/ or certain
             subsidiaries or assets;

       (ii)  Assisting management with the preparation of a
             timeline setting forth the critical dates in the
             divestiture process;

      (iii)  Assisting management in the preparation of a
             complete confidential memorandum to present to
             potential buyers;

       (iv)  Contacting potential buyers to determine
             preliminary interest;

        (v)  Conducting facilities visits for potential buyers;

       (vi)  Assisting in negotiations to reach an agreement in
             principle and/or definitive agreement.

As proposed, CDG will be compensated for these services,
pursuant to the provisions of Sections 330(a) and 331 of the
Bankruptcy Code and as described in the Retention Letter:

(a)  Monthly Fee:  The Debtors will pay a monthly fee of
     $150,000.  CDG will credit 100% of each Monthly Fee
     received towards the Restructuring Fee and any Divestiture
     Fee.

(b)  Restructuring Fee:  The Debtors will pay CDG a
     Restructuring Fee of $3,000,000 upon the effective date of
     a plan of reorganization for the Debtors.

(c)  Divestiture Fee:  If WPC chooses to sell substantially all
     of the Debtors, CDG will receive a Divestiture Fee of 1% of
     Aggregate Consideration upon the consummation of the sale.
     CDG will receive a Divestiture Fee of 0.75% of Aggregate
     Consideration upon the sale of Wheeling Corrugating
     Company, Ohio Coatings Company, the Debtors. coke ovens and
     Wheeling-Nisshin, Inc., and 1.5% of Aggregate Consideration
     upon the sale of any other business or other assets (other
     than the sale of inventory or accounts receivable in
     discrete transactions) of the Debtors.  In addition to the
     credit of the Monthly Fees, any Divestiture Fee received
     will be credited towards the Restructuring Fee. (Wheeling-
     Pittsburgh Bankruptcy News, Issue No. 24; Bankruptcy
     Creditors' Service, Inc., 609/392-0900)  


WILLIAMS COMMS: Classification & Treatment of Claim Under Plan
--------------------------------------------------------------
Williams Communications Group, Inc., and its debtor-affiliates'
First Amended Plan of Reorganization dated July 26, 2002 groups
all prepetition Claims and Equity Interests into classes and
explains how those claims and interests will be treated:

Class  Description          Treatment
-----  -----------          ---------
N/A  Administrative        Administrative Claims will be paid
                            in full on the Distribution Date or
                            in the ordinary course of the
                            Debtors' business.

N/A   Priority Tax Claims  Allowed Priority Tax Claims will be
                            paid in full over a 6-year period.

  1    Priority Non-Tax     Allowed priority non-tax claims are
       Claims               unimpaired by the Plan and will be
                            paid in the ordinary course of the
                            Debtors' business.

  2    Prepetition Secured  Allowed prepetition secured claims
       Claims               are principal asset under the
                            Company's senior secured credit
                            unimpaired by the Plan and will be
                            satisfied in accordance with the
                            Restated Credit Documents.

  3    Other Secured Claims Unless otherwise agreed, other
                            Secured Claims, if any, will retain
                            all of their rights and security
                            interests and will receive either
                            deferred Cash payments equal to the
                            value of the Collateral securing
                            the Claim or possession of the
                            Collateral.

  4    TWC Claims           In accordance with the TWC
                            Settlement Agreement, the Plan
                            provides that the TWC Assigned
                            Claims will be Allowed Claims in
                            the aggregate amount of
                            $2,362,117,000 and entitle their
                            holder (Leucadia) to receive 24.55%
                            of the New Equity, the estimated
                            value of which is $178,000,000
                            (subject to reduction to 23.55%
                            ($171,000,000) by shares issued to
                            the Securities Holder Channeling
                            Fund).  In the absence of the TWC
                            Settlement Agreement, the Debtors
                            estimate that, if allowed, the
                            holder of the TWC Assigned Claims
                            would be entitled to 38.5% of the
                            New Equity, the estimated value of
                            which is $280,000,000.

  5    Senior Redeemable    Each Senior Redeemable Notes Claim
       Note Claim           of a WCG Affiliate will be
                            disallowed in its entirety.  Each
                            holder of an Allowed Senior
                            Redeemable Notes Claims will receive
                            its Pro Rata Share of 55% of the New
                            Equity, the estimated value of which
                            is $398,750,000 (subject to
                            reduction to 51.3% ($372,000,000) by
                            shares issued to lock-up Noteholders
                            and shares issued to the Securities
                            Holder Channeling Fund).  In the
                            absence of the TWC Settlement
                            Agreement, the Debtors estimate that
                            holders of Allowed Senior Redeemable
                            Notes Claims would be entitled to
                            their Pro Rata Share of 41% of the
                            New Equity, the estimated value of
                            which is $298,000,000.

  6    Other Unsecured      Each holder of an Allowed Other
       Claim                Unsecured Claim will receive its Pro
                            Rata Share of 55% of the New Equity,
                            the estimated value of which is
                            $398,750,000 (subject to reduction
                            to 51.3% ($372,000,000) by shares
                            issued to Lock-Up Noteholders and
                            shares issued to the Securities
                            Holder Channeling Fund). In the
                            absence of the TWC Settlement
                            Agreement, the Debtors estimate that
                            holders of Allowed Other Unsecured
                            Claims would be entitled to their
                            Pro Rata Share of 41% of the New
                            Equity, the estimated value of which
                            is $298,000,000.

  7    Subordinated Claim   Each and every Subordinated Claim
                            will be fully and completely
                            discharged and the holder thereof
                            will receive no distribution under
                            the Plan on account of the Class 7
                            Claim.

  8    WCG Equity Interests On the Effective Date, each and
                            every Equity Interest in WCG will
                            be cancelled and discharged and the
                            holder thereof will receive no
                            distribution under the Plan on
                            account of the Class 8 WCG Equity
                            Interest.

  9    CG Austria Equity    On the Effective Date, each and
       Interests            every Equity Interest in CG Austria
                            will be reinstated as though the
                            Chapter 11 Cases had not been filed.
(Williams Bankruptcy News, Issue No. 8; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


WILLIAMS COS: Closes Asset Sales with Net Cash Proceeds of $1.4B
----------------------------------------------------------------
Williams (NYSE: WMB) announced a series of transactions that
resolve liquidity issues and greatly strengthen the company's
finances.  The transactions delivered net cash proceeds of $1.4
billion from asset sales and $2 billion in secured financing.

"The company's top priorities have been to improve our financial
position and resolve regulatory issues facing the company.  
These significant financial achievements, combined with the
progress that was announced last week on the regulatory front,
demonstrate that we are gaining traction in our efforts to move
forward on a stronger foundation," said Steve Malcolm, chairman,
president and CEO.

The following transactions have provided the company with $3.4
billion in cash or available credit:

     -- A $1.1 billion credit agreement providing for an amended
$700 million secured revolving credit facility and a new $400
million letter of credit facility.

     -- A $900 million senior secured credit agreement with a
group of investors led by Lehman Brothers Inc. and Berkshire
Hathaway.  This facility is secured by substantially all of the
oil and gas interests of Barrett Resources, which Williams
acquired last year.  The loan has been fully funded and Williams
has received the proceeds.

     -- The sale for approximately $1.2 billion of 98 percent of
Mapletree LLC and 98 percent of E-Oaktree, LLC to Enterprise
Products Partners L.P.  Mapletree owns all of Mid-America
Pipeline, a 7,226-mile natural gas liquids pipeline system.  E-
Oaktree owns 80 percent of the Seminole Pipeline, a 1,281-mile
natural gas liquids pipeline system.  The sale generated $1.1
billion in net cash proceeds.

     -- The sale of the company's Jonah Field natural gas
production properties in Wyoming for $350 million to EnCana Oil
& Gas (USA) Inc.  The company also completed the sale of the
vast majority of its natural gas production properties in the
Anadarko Basin to Chesapeake Exploration Limited Partnership for
approximately $37.5 million.  The sales generated $308 million
in net cash proceeds.

Malcolm said the company's board of directors approved
management's recommendation to continue to reduce Williams'
financial commitment and exposure to its energy marketing and
risk management business.

"Tough times require tough decisions.  We are committed to
repositioning Williams to compete effectively in the energy
industry of the future.  In addition to these actions, we are
continuing with our previously announced plans to sell assets
that are non-strategic," Malcolm said.  "At the same time, we
are increasing our efforts to exceed our annual cost-savings
goal of $150 million."

Late last week, the company announced it reached an agreement in
principle that it hopes will lay the framework for resolving its
California power issues.  Also, Williams last week reached a
settlement, which if approved by the court, would resolve the
bankruptcy proceedings involving its former telecommunications
subsidiary.  Separately, a senior Federal Energy Regulatory
Commission official said the company had adequately addressed
questions the agency raised in a June 3 order related to natural
gas and power trading in Western markets.

Williams owns and operates a balanced set of energy
infrastructure businesses - interstate pipelines, midstream
gathering and processing systems, and exploration and
production. These businesses and investments include:

     -- Interstate natural gas pipeline systems that span the
country, ultimately serving the equivalent of more than 40
million residential, commercial and industrial natural gas
users.

     -- A leading natural gas gathering and processing unit with
profile positions in the Rocky Mountains and U.S. Gulf Coast,
along with natural gas liquids storage, fractionation and
transportation businesses at Conway, Kan., and throughout
Louisiana.

     -- One of the largest independent producers of natural gas
in the United States, with significant production and reserves
in the Piceance, Powder River, Green River, Uinta, San Juan,
Raton, Niobara, Hugoton and Arkoma basins.  Following Thursday's
announced sales, production is expected to remain above 500
million cubic feet per day, with reserves in excess of 2.8
trillion cubic feet of natural gas.

     -- A 55-percent interest in Williams Energy Partners (NYSE:
WEG), a publicly held master limited partnership that owns
petroleum storage, terminals and pipeline transportation
services.

Lehman Brothers Inc., acted as lead financial restructuring
adviser. Lehman and Merrill Lynch advised on asset sales.  
Citigroup led the banks in the credit facility.  Skadden, Arps,
Meagher & Flom LLP acted as legal adviser.

Williams moves, manages and markets a variety of energy
products, including natural gas, liquid hydrocarbons, petroleum
and electricity.  Based in Tulsa, Okla., Williams' operations
span the energy value chain from wellhead to burner tip.  
Company information is available at http://www.williams.com


WORLDCOM INC: Wants to Continue Workers' Compensation Program
-------------------------------------------------------------
In connection with the operation of its businesses, Marcia L.
Goldstein, Esq., at Weil Gotshal & Manges LLP in New York,
relates that Worldcom Inc., and its debtor-affiliates maintain
various workers' compensation programs, insurance policies, and
related programs through several different insurance carriers.  
The Insurance Programs include coverage for claims relating to
workers' compensation, commercial general, excess liability,
commercial umbrella liability, commercial crime, transit,
environmental liability, errors and omissions, and property.

Under the laws of the various states in which they operate, the
Debtors are required to maintain workers' compensation policies
and programs to provide their employees with workers'
compensation coverage for claims arising from or related to
their employment with the Debtors.  The Debtors maintain
separate workers' compensation policies with Zurich American
Insurance Company in each of the states in which they operate to
cover their statutory obligations.  Prior to July 1, 2002, the
Debtors operated under a "large deductible" workers'
compensation program through Zurich.  However, Zurich indicated
that it would not renew the Debtors' workers' compensation
policies as they were being administered under the Large
Deductible Program.  As a result, the Debtors entered into
"guaranteed cost" workers' compensation program with Zurich on
July 1, 2002.

Currently, Ms. Goldstein states that the premiums for the
Guaranteed Cost Program are paid once a year and are based on a
fixed percentage of the Debtors' estimated annual workers'
compensation payroll.  The annual premium with respect to the
Guaranteed Cost Program for coverage period July 1, 2002 through
July 1, 2003 reached $17,786,743, which amount was paid to
Zurich on June 28, 2002.  The Debtors estimate that the premium
for coverage period July 1, 2003 through July 1, 2004 will total
$20,400,000.  For each settled workers' compensation claim that
arose or arises during the period covered by the Guaranteed Cost
Program, Zurich pays the full amount of the settlement to the
individual claimant.

Ms. Goldstein informs the Court that the Debtors' Large
Deductible Program from Zurich is administered by Gallagher
Bassett Services, Inc.  Under the Large Deductible Program,
employees who were injured during the period when the Large
Deductible Program was in place submit their claims directly to
Gallagher Bassett, who in turn issues payments to the injured
employees from a trust account established by the Debtors for
the specific purpose of paying workers' compensation claims
under the program.  In connection with the Large Deductible
Program, the Debtors had a $19,000,000 letter of credit granted
as security to Zurich to pay claims under the Large Deductible
Program in the event that WorldCom fails to pay claims under the
program.  The Debtors' average monthly expenditure in 2001 for
the Large Deductible Program was $450,000.

As of the Petition Date, Ms. Goldstein reports that there were
629 workers' compensation claims pending against the Debtors
arising out of injuries incurred by employees during the course
of their employment.  Because payment of the prepetition
Workers' Compensation Claims is essential to the continued
operation of the Debtors' businesses under the laws of the
various states in which they operate, the Debtors seek the
Court's authority to pay all amounts due and owing with respect
to any of the Workers' Compensation Programs, and to maintain
and continue prepetition practices with respect to the Workers'
Compensation Programs, including allowing workers' compensation
claimants to proceed with their claims under the applicable
insurance policy or program.  The Debtors estimate that, as of
the Petition Date, the Workers' Compensation Claims reach
$6,980,000.  Most of this amount is not a current obligation of
the Debtors, rather it will become payable over the next four
years.

Ms. Goldstein adds that the Debtors also maintain various
general liability and property insurance policies, which provide
insurance coverage for claims relating to commercial general,
excess liability, commercial umbrella liability, automobile
liability, directors' and officers' liability, fiduciary
liability, commercial crime, transit, environmental liability,
errors and omissions, and property.  These policies are
essential to the ongoing operation of the Debtors' businesses.  
The Debtors are required to pay premiums under the Liability and
Property Programs based upon a fixed rate established and billed
by each Insurance Carrier.  The aggregate annual premiums for
the Liability and Property Programs is about $36,837,000.  The
premiums for the Liability and Property programs are paid yearly
in advance and the vast majority of Debtors' premiums have been
paid for coverage periods ending June or July 2003.

Under the property liability program, Ms. Goldstein tells the
Court that the Debtors are required to pay a $2,500,000
deductible for each claim, which reduces the amount that the
Insurance Companies are required to pay for the claim.  For each
claim under a property program, the Debtors pay the deductible
and the insurance company pays the remainder of any claim.  On
average, the Debtors pay $328,000 each month for these
deductibles.

By this motion, the Debtors seek the Court's to continue the
Workers' Compensation Programs and maintain the Liability and
Property Programs on an uninterrupted basis, consistent with
prepetition practices, and pay when due and in the ordinary
course, all prepetition premiums, administrative fees and other
prepetition obligations to either the Insurance Brokers or the
issuers of the Insurance Policies to the extent due and payable
postpetition.  To the extent a premium payment or other costs of
the Workers' Compensation Programs, the Large Deductible Program
and the Liability and Property Programs relating to a period
prior to the Petition Date are outstanding, the Debtors also ask
seek the Court's permission to make these payments.

Some of the Insurance Policies contain deductible amounts for
each claim that is submitted or for the policy as a whole.  To
the extent a deductible payment or reimbursement relating to a
period prior to the Petition Date is outstanding with respect to
any Insurance Policy, the Debtors seek the Court's authority to
make the payments in the same manner that these payments were
made prepetition.

Ms. Goldstein notes that the failure to pay premiums when due
may affect the Debtors' ability to renew the Insurance Policies.  
If the Insurance Policies are allowed to lapse, the Debtors
could be exposed to substantial liability for damages resulting
to persons and property of the Debtors and others, which could
have an extremely negative impact on their ability to
successfully reorganize.  Additionally, continued effectiveness
of the directors' and officers' liability policies is necessary
to the retention of qualified and dedicated senior management.
Furthermore, the Debtors are obligated to remain current with
respect to certain of their primary insurance policies.

Ms. Goldstein asserts that the maintenance of the Workers'
Compensation Programs is indisputably justified, as applicable
state law mandates this coverage.  Furthermore, with respect to
the Workers' Compensation Claims, the risk that eligible
claimants will not receive timely payments with respect to
employment-related injuries could have a devastating effect on
the financial well-being and morale of the Debtors' employees
and their willingness to remain in the Debtors' employ.  A
significant deterioration in employee morale undoubtedly will
have a substantially adverse impact on the Debtors, the value of
their assets and businesses, and their ability to reorganize.
Departures by employees at this critical time may result in a
disruption of the Debtors' businesses to the detriment of all
parties-in-interest.

Ms. Goldstein notes that the amounts the Debtors propose to pay
in respect of the Insurance Programs are minimal in light of the
size of the Debtors' estates and the potential exposure absent
insurance coverage. (Worldcom Bankruptcy News, Issue No. 2;
Bankruptcy Creditors' Service, Inc., 609/392-0900)  

Worldcom Inc.'s 11.25% bonds due 2007 (WCOM07USA1) are trading
at 22.5, DebtTraders reports. For real-time bond pricing, see
http://www.debttraders.com/price.cfm?dt_sec_ticker=WCOM07USA1


XO COMMS: Committee Seeks Approval to Hire Akin Gump as Counsel
---------------------------------------------------------------
Akin Gump served as counsel to the Informal Committee, which
comprised of Senior Noteholders of XO Communications, Inc.  This
Informal Committee had negotiated with the Debtor for a
consensual restructuring of the XO's debt obligations.  When the
United States Trustee appointed the Official Committee of
Unsecured Creditors on June 24, 2002, the Informal Committee
dissolved.  Two of the five Informal Committee members are now
members of the Official Committee.

Accordingly, the Informal Committee released Akin Gump as its
counsel and the Official Committee selected Akin Gump to serve
as counsel.

By this application, the Committee seeks the Court's authority
to retain Akin Gump Strauss Hauer & Feld LLP as its counsel in
the Debtor's chapter 11 case, nunc pro tunc to June 24, 2002.  
The Committee asserts that Akin Gump has extensive knowledge and
expertise in the areas of law relevant to this case.  Akin Gump
is well qualified to represent the Committee in this Case.  Akin
Gump is expected to:

(a) advise the Committee with respect to its rights, duties and
    powers in this Case;

(b) assist and advise the Committee in its consultations with
    the Debtor relative to the administration of this Case;

(c) assist the Committee in analyzing the claims of the Debtor's
    creditors and the Debtor's capital structure and in
    negotiating with holders of claims and equity interests;

(d) assist the Committee in its investigation of the Debtor's
    acts, conduct, assets, liabilities and financial condition
    and the Debtor's operation of its businesses;

(e) assist the Committee in its analysis of, and negotiations
    with the Debtor or any third party concerning matters
    related to, among other things, the assumption or rejection
    of leases of non-residential real property and executory
    contracts, asset dispositions, financing of other
    transactions and the terms of a plan of reorganization for
    the Debtor;

(f) assist and advise the Committee as to its communications to
    the general creditor body regarding significant matters in
    this Case;

(g) represent the Committee at all hearings and other
    proceedings;

(h) review and analyze applications, orders, statements of
    operations and schedules filed with the Court and advise the
    Committee as to their propriety;

(i) assist the Committee in preparing pleadings and
    applications; and

(j) perform other legal services as may be required.

The Committee asks Judge Gonzalez that all legal fees and
related costs and expenses it incurs on account of Akin Gump's
services be paid as administrative expenses.  Akin Gump intends
to charge for its legal services on an hourly basis.  Akin Gump
will also maintain detailed records of actual and necessary
costs and expenses incurred in connection with the legal
services in this case.

The current hourly rates, subject to periodic adjustments, are:

           Partners                        $400 - 700
           Special Counsel and Counsel      285 - 600
           Associates                       185 - 430
           Paraprofessionals                 55 - 165

The names, positions and current hourly rates of the Akin Gump
professionals expected to have primary responsibility for
providing services to the Committee are:

      Daniel H. Golden (Partner)         - $675;
      David H. Botter (Partner)          - $450;
      Christopher A. Provost (Associate) - $350; and
      Kenneth Davis (Associate)          - $280.

Other Akin Gump professionals may provide services to the
Committee.

Akin Gump received a $300,000 retainer from the Debtor.  The
firm has applied the Retainer to certain fees and expenses
incurred in connection with prepetition services rendered to the
Informal Committee.  In addition, Akin Gump has applied the
Retainer to the fees and expenses incurred in connection with
services rendered to the Informal Committee postpetition through
the formation of the Committee.  Akin Gump has received
$1,687,961.39 payment from the Debtor for services rendered
prior to the formation of the Committee.  The current balance of
the retainer is $184,680.55.

David H. Botter, Esq., a member of Akin Gump, discloses that,
Mathew C. Weed, an associate with the Washington, D.C. office of
Akin Gump, is the son-in-law of Daniel F. Akerson, the Chairman
and Chief Executive Officer of the Debtor.  In order to avoid
any appearance or risk of impropriety, Akin Gump will establish
an ethical wall between the personnel working on behalf of the
Committee, on the one side, and Mathew C. Weed and his secretary
Janita C. Bise, on the other side.  Communications, documents,
and other material relating to the XO case shall not be
communicated to Mathew C. Weed or his secretary Janita C. Bise,
Mr. Botter assures the Court.

According to Mr. Botter, Akin Gump currently represents certain
parties-in-interest in matters wholly unrelated to the Debtor's
chapter 11 case.  Mr. Botter reports that Akin Gump's services
on behalf of each party-in-interest constitutes no more than 2%
of the firm's annual revenues for the 2001 fiscal year.  
Therefore, it does not comprise a material component of Akin
Gump's practice.

Mr. Botter asserts that Akin Gump is a "disinterested person"
within the meaning of the Bankruptcy Code.

Mr. Botter promises that, to the extent that Akin Gump discovers
additional information with respect to its representation of
interested parties, the firm will immediately disclose the
information to the Court on notice to creditors and the United
States Trustee.

Judge Gonzalez will conduct a hearing on the application on
August 7, 2002 at 10:00 a.m. (XO Bankruptcy News, Issue No. 5;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


*BOOK REVIEW: The Oil Business in Latin America: The Early Years
----------------------------------------------------------------
Author:  John D. Wirth Ed.
Publisher:  Beard Books
Softcover:  282 pages
List price:  $34.95
Review by Gail Owens Hoelscher
Buy a copy for yourself and one for a colleague on-line at
http://amazon.com/exec/obidos/ASIN/1587981033/internetbankrupt   

This book grew out of a 1981 meeting of the American Historical
Society. It highlights the origin and evolution of the state-
owned petroleum companies in Argentina, Mexico, Brazil, and
Venezuela.

Argentina was the first country ever to nationalize its
petroleum industry, and soon it was the norm worldwide, with the
notable exception of the United States. John Wirth calls this
phenomenon "perhaps in our century the oldest and most
celebrated of confrontations between powerful private entities
and the state."

The book consists of five case studies and a conclusion, as
follows:

     * Jersey Standard and the Politics of Latin American Oil
          Production, 1911-30 (Jonathan C. Brown)

     * YPF: The Formative Years of Latin America's Pioneer State
          Oil Company, 1922-39 (Carl E. Solberg)

     * Setting the Brazilian Agenda, 1936-39 (John Wirth)

     * Pemex: The Trajectory of National Oil Policy (Esperanza
          Duran)

     * The Politics of Energy in Venezuela (Edwin Lieuwen)

     * The State Companies: A Public Policy Perspective (Alfred
          H. Saulniers)

The authors assess the conditions at the time they were writing,
and relate them back to the critical formative years for each of
the companies under review. They also examine the four
interconnecting roles of a state-run oil industry and
distinguish them from those of a private company. First, is the
entrepreneurial role of control, management, and exploitation of
a nation's oil resources. Second, is production for the private
industrial sector at attractive prices. Third, is the
integration of plans for military, financial, and development
programs into the overall industrial policy planning process.
Finally, in some countries is the promotion of social
development by subsidizing energy for consumers and by promoting
the government's ideas of social and labor policy and labor
relations.

The author's approach is "conceptual and policy oriented rather
than narrative," but they provide a fascinating look at the
politics and development of the region. Mr. Brown provides a
concise history of the early years of the Standard Oil group and
the effects of its 1911 dissolution on its Latin American
operations, as well as power struggles with competitors and
governments that eventually nationalized most of its activities.
Mr. Solberg covers the many years of internal conflict over oil
policy in Argentina and YPF's lack of monopoly control over all
sectors of the oil industry. Mr. Wirth describes the politics
and individuals behind the privatization of Brazil's oil
industry leading to the creation of Petrobras in 1953. Mr. Duran
notes the wrangling between provinces and central government in
the evolution of Pemex, and in other Latin American countries.
Mr. Lieuwin discusses the mixed blessing that oil has proven for
Venezuela., creating a lopsided economy dependent on the ups and
downs of international markets. Mr. Saunders concludes that many
of the then-current problems of the state oil companies were
rooted in their early and checkered histories." Indeed, he says,
"the problems of the past have endured not because the public
petroleum companies behaved like the public enterprises they
are; they have endured because governments, as public owners,
have abdicated their responsibilities to the companies."

Jonh D. Wirth is Gildred Professor of Latin American Studies at
Standford University.

                          *********

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
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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
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                *** End of Transmission ***