TCR_Public/020812.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

              Monday, August 12, 2002, Vol. 6, No. 158

                          Headlines

ADELPHIA BUSINESS: Gets Final Approval of $15MM DIP Financing
ALTERNATE MARKETING: Fails to Satisfy Nasdaq Listing Guidelines
AMERICAN HOME: Gets Okay to Tap Houlihan Lokey for Fin'l Advice
AMES DEPARTMENT: Brings-In Deloitte & Touche to Replace Andersen
ANCHOR GLASS: Court Confirms Prenegotiated Recapitalization Plan

ARTESIA: Fitch Affirms Low-B Ratings to Class F & G P-T Certs.
BCE INC: Underwriters Use Over-Allotment Option for 11MM Shares
BRIGGS & STRATTON: Posts Improved Results for Fiscal 4th Quarter
BROADWAY TRADING: Case Summary & 20 Largest Unsecured Creditors
BUDGET GROUP: Wants to Continue Use of Cash Management System

CAITHNESS COSO: S&P Affirms BB Rating on $303M Sr. Secured Bonds
CALYPTE BIOMEDICAL: Townsbury Investments Acquires 900K Shares
CASTLE DENTAL: Closes Debt Workout Transaction with Sr. Lenders
CEDARA SOFTWARE: Names Abe Schwartz to the Board of Directors
CHARMING SHOPPES: Reaffirms Earnings Guidance for Second Quarter

CONSECO INC: Lazard and Kirkland Called-In for "Radical Change"
CORNERSTONE: Will Commence Trading on OTCBB Under CNPP Symbol
CRESCENT REAL: Second Quarter Results Meet Targets and Guidance
DADE BEHRING: Wants to Pay Essential Vendors' Prepetition Claims
ELCOM INT'L: Hosts First U.K. Public Sector Online Auction

EMAGIN: Sees Need to Restructure Debt to Execute Business Plan
ENRON CORP: Court Fixes October 15 Bar Date for Proofs of Claim
ENRON: Sells Oneida's Aircraft Interests to Compass for $10.3MM
FEDERAL-MOGUL: Inks Letter of Intent to Sell OE Lighting Assets
FRUIT OF THE LOOM: Settles Claims against William Farley

GSI GROUP: Engages BKD LLP to Replace Arthur Andersen
GENERAL DATACOMM: Closes $7MM Sale of Connecticut Real Estate
GLOBAL CROSSING: Providing E-xpedient with 35 Fast-E Ports
HAYES LEMMERZ: Gets Approval to Retain PRI as Internal Auditor
ICG COMMS: Supplemental Disclosure Statement Hearing on Aug. 23

ION NETWORKS: Deloitte & Touche Raises Going Concern Doubt
IT GROUP: Wants to Implement Employee Retention & Severance Plan
INACOM: Deloitte & Touche Gets Go-Signal to Withdraw Services
INTEGRATED HEALTH: Will Pay GE $1.6MM to Keep Leased Equipment
INTERLIANT: Gets Court Approval to Hire Kronish Lieb as Counsel

J.P. MORGAN: S&P Cuts Ratings on Class G & H Certificates
JANUS HOTELS: Fails to Maintain Nasdaq Listing Requirements
KMART: Equity Committee Brings-In Goldberg Kohn as Local Counsel
KMART CORP: Enters Into Settlement Deal with IBM Credit
LEXAM EXPLORATIONS: Evaluating Possible Reorganization Options

MAIL-WELL: Closes Sale of Filing Products Division to IFC Unit
MERRY-GO-ROUND: Trustee Attacks Fidelity's $20MM Melville Claim
MERRILL LYNCH: Fitch Hatchets Class F P-T Certs. Down to B-
METROLOGIC INSTRUMENTS: 2nd Quarter Sales Slides up 5% to $29MM
NEON COMMS: Court Fixes August 26, 2002 General Claims Bar Date

NEWPOWER: Seeking Interim Okay to Use Enron's Cash Collateral
PENN TREATY: S&P Says Option Exercise Will Not Affect Ratings
PHARMACEUTICAL FORMULATIONS: Rights Offering Extended to Oct. 23
PHAR-MOR: Court OKs Agency Pact Selling Assets to Hilco-Ozer JV
PLANVISTA CORP: Fails to Comply with Nasdaq Listing Standards

RSL COM: Gets Plan-Filing Exclusivity Extension Until October 11
READER'S DIGEST: Court Nixes Attempt to Enjoin Recapitalization
RUSSIAN TEA ROOM: Case Summary & 20 Largest Unsecured Creditors
SLI INC: NYSE Suspends Stock Trading
SAFETY-KLEEN: Committee Taps Genovese Joblove as Special Counsel

SALTON SEA: S&P Cuts Rating on $592MM Senior Secured Notes to BB
SILVER STAR FOODS: Zeller Weiss Expresses Going Concern Doubt
STAR TELECOMMS: Delaware Court Confirms Amended Liquidation Plan
US STEEL: Fitch Affirms BB Senior Unsecured Long-Term Rating
US AIRWAYS: ALPA Pilots Ratify Restructuring Plan Agreement

US AIRWAYS: Files for Chapter 11 Reorganization in Virginia
US AIRWAYS GROUP: Case Summary & 30 Largest Unsecured Creditors
US AIRWAYS: Machinists Tap Lowenstein and Sandler as Attorneys
VANGUARD AIRLINES: Taps Polsinelli Shalton as Bankruptcy Counsel
WEBLINK WIRELESS: Hires KPMG to Replace Andersen as Accountants

WORLDCOM: Seeks Approval to Employ Ordinary Course Professionals
WORLDCOM INC: SBC Seeks Payment for Future Services to MCI Unit
Z-TEL TECHNOLOGIES: June 30 Equity Deficit Reaches $83 Million
ZAMBA SOLUTIONS: June 30 Balance Sheet Upside-Down by $3 Million

* Fitch Discusses SEC Certifications and Companies' Ratings

* BOND PRICING: For the week of August 12 - August 16, 2002

                          *********

ADELPHIA BUSINESS: Gets Final Approval of $15MM DIP Financing
-------------------------------------------------------------
Adelphia Business Solutions (Pink Sheets: ABIZQ) has received
final approval from the U.S. Bankruptcy Court and closed on a
$15 million secured debtor-in-possession credit facility with
Beal Capital Markets, Inc., of Plano, Texas.  ABS believes that,
in conjunction with previously announced modifications to its
business plan, this Credit Facility will provide ABS with the
necessary liquidity to facilitate its emergence from the Chapter
11 process as a vibrant competitor in the telecommunications
industry.

"This is a significant step forward for the company," said Bob
Guth, president and CEO of Adelphia Business Solutions, Inc.
"We have modified our business plan to its profitable core, and
with this secured Credit Facility in place, we believe we have
the necessary funding to reach our projected Positive Free Cash
Flow milestone later this year."  Mr. Guth continued, "We are
pleased that Beal felt confident in making this investment in
ABS after its review of our business fundamentals and assets.
This closing evidences the viability of ABS' core business plan
and our sound strategic direction."

Ken Springfield of Beal also stated, "We're excited about our
role in ABS' restructuring, and we look forward to an expanded
business relationship as the company emerges a key player in the
telecommunications sector."

ABS offers its full line of products and services, including
local voice and data, intercity services, long distance,
Internet, and a number of other value-added services including
web-hosting and co-location in 35 company-owned markets, as well
as other company-managed markets and partnerships throughout the
nation.

Founded in 1991, Adelphia Business Solutions provides integrated
communications services including local and long distance voice
services, high-speed data and Internet services.  For more
information on Adelphia Business Solutions, please visit the
Company's Web site at http://www.adelphia-abs.com


ALTERNATE MARKETING: Fails to Satisfy Nasdaq Listing Guidelines
---------------------------------------------------------------
Alternate Marketing Networks, Inc., (Nasdaq: ALTM) reported has
received a Nasdaq Staff Determination indicating that the
Company's securities are subject to delisting from the Nasdaq
SmallCap Market because the Staff believes that the previously
announced acquisition of Hencie, Inc., constitutes a "reverse
merger" under Marketplace Rule 4330(f) and requires the Company
to satisfy Nasdaq's initial listing requirements in order to
remain on the exchange.

Alternate Marketing Networks said it has requested and received
approval for a hearing before a Nasdaq Listing Qualifications
Panel to appeal the Staff's classification of the transaction
and to review the delisting determination.  A hearing has been
scheduled for September 2002.  The Company's securities will
continue to be listed on the Nasdaq SmallCap Market pending the
outcome of the hearing, although there can be no assurances that
the Panel will grant the Company's request for continued
listing.

The Grand Rapids, Michigan-based national marketing and
technology services company would have to meet a minimum bid
price of $4.00 per share for its common stock and a market value
of the publicly held shares of at least

$5 million in order to satisfy Marketplace Rules 4310(C)(4) and
4310(C)(7) and remain listed on the Nasdaq SmallCap Market if
its appeal of the Staff's classification of the transaction is
unsuccessful.

"The board and management believe that continued listing on a
public exchange is an important element in our strategy to
provide value and liquidity for shareholders," said Phillip
Miller, chairman of Alternate Marketing Networks.  "We are
reviewing this situation closely with counsel to explore all
options to maintain our listing, including our intention to
present our case at a Nasdaq hearing on the benefits that this
acquisition brings to Alternate Marketing and to our continued
listing on the exchange."

Alternate Marketing Networks -- http://www.altmarknet.com-- is
a single-source provider of marketing and technology services
offering a broad range of products and services.  The Company
recently acquired Hencie, Inc., an Oracle Corp., e-business
solutions and applications provider.  Alternate Marketing
Networks offers comprehensive services in three primary areas:
advertising and marketing, logistics and marketing and
technology services. Alternate Marketing Networks serves the
newspaper, consumer package goods, automotive, technology,
discrete manufacturing, distribution, energy, travel and
hospitality industries.


AMERICAN HOME: Gets Okay to Tap Houlihan Lokey for Fin'l Advice
---------------------------------------------------------------
American Home Patient, Inc., and certain of its debtor-
affiliates, sought and obtained approval from the US Bankruptcy
Court for the District of Tennessee to employ and retain
Houlihan Lokey Howard & Zukin Capital as their Financial
Advisors in the Company's Chapter 11 cases.

The Debtors will turn to Houlihan for help in:

      a. Evaluating the Debtors' strategic options based upon
         Houlihan Lokey's initial review;

      b. Advising the Debtors generally as to available
         financing and capital restructuring alternatives,
         including recommendations of specific courses of
         action;

      c. Assisting the Debtors with the development, negotiation
         and implementation of a plan of reorganization,
         including participation as an advisor to the Debtors in
         negotiations with creditors and other parties involved
         in a restructuring;

      d. Assisting the Debtors with the design of any debt and
         equity securities or other consideration to be issued
         in connection with a Plan;

      e. Assisting the Company in communications and
         negotiations with its constituents, including
         creditors, employees, vendors, shareholders and other
         parties-in-interest in connection with any Plan;

      f. Providing Bankruptcy Court testimony, if required, with
         respect to any matter as to which Houlihan Lokey is
         rendering services; and

      g. Rendering such other investment banking or financial
         advisory services as may be requested by the Debtors or
         their counsel and agreed to by Houlihan Lokey.

Houlihan Lokey is entitled to receive, as compensation for its
services:

       a. a Monthly Fee of $125,000;

       b. a Transaction Fee equal to $1,500,000; and

       c. reimbursement of all reasonable out-of-pocket
          expenses.

American Homepatient, Inc., provides home health care services
and products consisting primarily of respiratory and infusion
therapies and the rental and sale of home medical equipment and
home care supplies. The Company filed for chapter 11 protection
on July 31, 2002. Glenn B. Rose, Esq., at Harwell Howard Hyne
Gabbert & Manner, PC represents the Debtors in their
restructuring efforts. When the Company filed for protection
from its creditors, it listed $269,240,077 in assets and
$322,129,850 in debts.


AMES DEPARTMENT: Brings-In Deloitte & Touche to Replace Andersen
----------------------------------------------------------------
On August 1, 2002, Deloitte & Touche LLP advised Ames Department
Stores, Inc.  that the Company had been accepted as an audit
client by Deloitte.  Subsequent to that, the Company informed
its former independent auditors, Arthur Andersen LLP that it had
been formally dismissed.  The Company's Board  of Directors,
upon recommendation of the Audit Committee of the Board of
Directors, had previously authorized the engagement of Deloitte
as the Company's new independent auditors. Deloitte will audit
the financial statements of Ames for the fiscal year ending
February 1, 2003 and will perform quarterly reviews for Fiscal
2002.  Because the Company is in bankruptcy proceedings, the
appointment of Deloitte will be subject to bankruptcy court
approval.

DebtTraders reports that Ames Department Stores' 10.000% bonds
due 2006 (AMES06USR1) are trading between 1 and 3. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=AMES06USR1
for real-time bond pricing.


ANCHOR GLASS: Court Confirms Prenegotiated Recapitalization Plan
----------------------------------------------------------------
Anchor Glass Container Corporation (OTC Bulletin Board: AGCCP)
received confirmation of a pre-negotiated plan of reorganization
filed last April, paving the way for reorganization to be
concluded by the end of August.  The plan was approved, on
schedule, by Judge C. Timothy Corcoran, III, of the U.S.
Bankruptcy Court for the Middle District of Florida, Tampa
Division.

Under terms of the re-capitalization approved by the Court
today, Anchor's secured bond holders retained $150 million of
first mortgage notes that are outstanding, plus received a
consent fee for a waiver of the change-of-control and pre-
payment provisions and other non-financial changes to the terms
of the notes.

The company's unsecured bondholders will be paid $50 million in
cash. Holders of Anchor Glass Series A preferred stock will
receive cash payments of $22.5 million.  All Series B preferred
stock and common stock will be cancelled.

The company said it received 100 percent affirmative votes on
the plan from "those voting on the plan".

In mid-March, Anchor signed an agreement with Cerberus Capital
Management LP, a New York City-based investment management firm,
to infuse Anchor with $100 million in new capital.

The filing was prompted by liquidity issues raised by change of
control provisions in the company's debt instruments.   The pre-
negotiated elements of the transaction provided for no
disruption to the company's employees, trade creditors,
customers and overall operations.

"We're pleased to have this behind us and to move forward with a
strengthened financial base," said Richard M. Deneau, President
and Chief Operating Officer of Anchor Glass.  "Looking ahead,
business remains very strong, and we are excited about the
Cerberus investment, which will allow us to continue to serve
our growing customer base."

Anchor Glass Container Corporation is the third largest
manufacturer of glass containers in the United States and
employs 2,900 at 12 U.S. locations. It supplies beverage and
food producers and manufacturers of consumer products worldwide.
The company has been based in Tampa, Florida since 1983.


ARTESIA: Fitch Affirms Low-B Ratings to Class F & G P-T Certs.
--------------------------------------------------------------
Artesia Mortgage CMBS, Inc.'s commercial mortgage pass-through
certificates, series 1998-C1, $41 million class A-1, $69.5
million class A-2, and notional class X are affirmed at 'AAA' by
Fitch Ratings. In addition, Fitch affirms the following classes:
$9.4 million class B at 'AA', $11.2 million class C at 'A', $9.8
million class D at 'BBB', $3.3 million class E at 'BBB-', $8.4
million class F at 'BB' and $5.6 million class G at 'B'. The
$8.4 million class NR is not rated by Fitch. The rating
affirmations follow Fitch's annual review of the transaction,
which closed in September 1998.

The certificates are collateralized by 221 loans that can be
characterized as 'micro loans' as the average loan size is
$753,918. The loans are secured by commercial and multifamily
properties with significant concentrations in retail (35%),
multifamily (27%), office (26%) and industrial (9%). The
properties are located in 28 states including California (23%),
Texas (17%), Arizona (9%), and Colorado (8%). As of the July
2002 distribution date, the pool's aggregate balance has been
reduced by 10.9% to $166.6 million from $187 million at
issuance.

Midland Loan Services, as master servicer, collected 2001
year-end operating statements for 93% of the loans in the pool.
The year-end weighted-average debt service coverage ratio for
comparable loans also reporting financials in 2000, has
increased to 1.78 times from 1.75x in YE 2000 and 1.61x at
issuance. The deal is diverse by loan size with the top five
loans accounting for only 5.9% of the entire pool balance. The
top five loans have a weighted-average YE 2001 DSCR of 1.79x
compared to 1.86x in YE 2000 and 1.71x at issuance.

Currently there are five loans, representing 2.5% of the pool,
in special servicing and 10 loans, representing 4.7% of the pool
on the servicer watchlist. This is a slight increase from the
2001 review when there was 2% of the pool in special servicing
and 2.7% of the pool on the servicer watchlist. Of the five
loans in special servicing three loans are REO and two loans are
current. The first REO property is an office building located in
Beaumont, TX. A mold problem was discovered in the property and
an indoor air quality report recommended total demolition of the
interior. The special servicer has decided to sell the building
in its current state because of the high remediation costs. The
next REO loan is a retail property located in El Paso, TX. The
property was formerly occupied by a Furr's Supermarket, who
filed bankruptcy in 2001, and subsequently vacated the property.
The special servicer is actively marketing the property. The
last REO loan is a retail property located in Carlsbad, NM. This
property was also formerly occupied by a Furr's Supermarket. The
special servicer is currently in negotiations with a prospective
purchaser. The fourth loan that is in special servicing is a
limited service hotel located in Leitchfield, KY. The loan was
90 days delinquent before the borrower brought the loan current
on July 11, 2002. The property is expected to return to the
master servicer after three consecutive payments are made. The
YE 2001 DSCR for this loan was 2.27x. The last specially
serviced property is a retail property located in Virginia. The
borrower has been in legal trouble and the United States
Government seized the property. The loan is current.

The rating affirmations are a result of the transaction's steady
performance and loan diversity. Fitch has concerns with the
increased amount of specially serviced and watchlist loans.
However, these loans continue to represent a small portion of
the overall transaction by balance. Fitch will continue to
monitor this transaction, as surveillance is ongoing.


BCE INC: Underwriters Use Over-Allotment Option for 11MM Shares
---------------------------------------------------------------
BCE Inc. (TSX, NYSE: BCE) announced that, in accordance with the
terms of the underwriting agreement for the public offering of
74 million common shares, the underwriters have exercised the
over-allotment option to acquire an additional 11 million common
shares, at a price of $24.45 per share. As a result, the total
gross proceeds of the offering will be approximately $2 billion.

The closing of the offering is scheduled to occur on August 12,
2002, and is subject to certain conditions set forth in the
underwriting agreement.

The common equity offering was placed by a syndicate of
underwriters with RBC Capital Markets acting as lead manager and
global book runner, Scotia Capital, co-lead and Canadian co-book
runner, Credit Suisse First Boston, co-lead and US co-book
runner and BMO Nesbitt Burns, co-lead manager.

Common shares offered outside the United States to non-US
persons will not be registered under the US Securities Act. The
portion of the common shares to be sold in the United States or
in circumstances where registration of the common shares is
required has been registered under a registration statement
filed with the US Securities and Exchange Commission. A copy of
the prospectus and related prospectus supplement may be obtained
from RBC Capital Markets, 1 Place Ville Marie, Suite 300,
Montreal, Quebec H3B 4R8.

BCE is Canada's largest communications company. It has 24
million customer connections through the wireline, wireless,
data/Internet and satellite services it provides, largely under
the Bell brand.


BRIGGS & STRATTON: Posts Improved Results for Fiscal 4th Quarter
----------------------------------------------------------------
Briggs & Stratton Corporation announced fiscal 2002 fourth
quarter net income of $30.6 million.  Net income for the fiscal
2001 fourth quarter was $4.5 million.  The increase in net
income between quarters was primarily the result of higher
engine unit sales and significantly higher engine plant
utilization.

For fiscal 2002, the Company reported net income of $53.1
million; for fiscal 2001 net income was $48.0 million.
Increased net income between years was primarily the result of
improved sales volume, cost reductions in manufacturing and
lower bad debt expense than experienced in fiscal 2001.

Engines:

Fiscal 2002 fourth quarter net sales of engines were $412.2
million versus $311.2 million in the prior year.  The 32%
increase is primarily the result of a 31% increase in engine
unit sales.  Net sales for fiscal 2002 were $1.37 billion, which
was $77.1 million or 6% higher than fiscal 2001.  On a year over
year basis, engine unit sales were up 8%. However, unit volume
increases were offset by changes in sales mix.  The entire unit
volume increase was composed of small horsepower, lower priced
engines and increased sales of lower priced models within
specific horsepower categories.

Income from operations for the fourth quarter of fiscal 2002 was
$52.6 million compared to $17.4 million in the fourth quarter
last year.  This $35.2 million improvement was primarily the
result of the higher sales volume discussed above and the
resulting benefit of spreading fixed costs over production
levels that were 45% higher than those in the fourth quarter
last year. During the fourth quarter last year we experienced
significantly reduced sales because of economic concerns.  In
addition, the Company cut back production levels significantly
to improve the level of its finished goods inventory.  During
the fiscal 2002 fourth quarter we experienced solid demand for
units.  Because production had been restrained in the early part
of the year to balance the inventory, we were able to maintain
strong production schedules for the full quarter.

The fiscal 2002 income from operations was $117.1 million, an
increase of $17.9 million or 18% over fiscal 2001 results.  The
net impact of an 8% unit volume increase and a 1% price increase
offset by an unfavorable sales mix to lower priced engines
provided about 35% of the $17.9 million improvement.  A year
long focus on reducing manufacturing expenses netted another 35%
of the improvement.  The balance of the improvement came from
lower bad debt expense as compared to last year when we were
affected by a large customer's bankruptcy.

Generac Portable Products:

Net sales of Generac products were $64.8 million in the fourth
quarter, up from $29.6 million a year ago because the Company
first acquired Generac on May 15, 2001.  The fiscal 2001 fourth
quarter net sales, covering both the Company's ownership and the
non-ownership period, were $56.2 million.  Fiscal 2002 net sales
were $216.0 million.  Sales for the comparable period last year,
when Briggs did not own Generac for the majority of the year,
were $192.2 million.

Fourth quarter fiscal 2002 net sales were up $8.6 million or 15%
from the $56.2 million in the fourth quarter of fiscal 2001.
Generator sales were up 3%.  The increase resulted from the mix
of product since volume was flat between years.  Pressure washer
sales were up 23% on a 26% volume increase between years.
Retail results for pressure washers were very strong due to the
implementation of successful promotional programs at key
retailers.

Net sales for fiscal 2002 increased $23.8 million or 12% over
the full fiscal 2001 results when Briggs did not own Generac for
the majority of the year.  Generator sales were up 16% on unit
volume increases of 10%.  A favorable mix of product accounts
for the remainder of the increase.  The volume increase was the
result of obtaining additional market share at a major retailer.
Pressure washer sales increased 11% on a 7% unit volume
increase. The volume increase resulted from the same factor
discussed for the quarterly improvement.

Income from operations in the fourth quarter and full year for
fiscal 2002 were $1.7 million and $2.1 million, respectively.
For the comparable periods last year, when Briggs did not own
Generac for a majority of the period, Generac had operating
losses of $3.2 million and $7.3 million for the respective
periods.  The $4.9 million improvement in fourth quarter
operating income is primarily the result of sales volume
increases and the reduction of operating expenses between years.
The expense decrease derives from the integration initiatives
that were put in place during the year and not having to
amortize goodwill in fiscal 2002.  The reasons for the fiscal
year operating income improvement of $9.4 million are the same
as for the fourth quarter.

General:

Interest expense was up in the fourth quarter and for the fiscal
year due to the long term debt issued in May, 2001, to fund the
acquisition of Generac and provide a more permanent source of
working capital funds.

Capital expenditures and depreciation for fiscal 2002 were $43.9
million and $60.2 million, respectively.  EBITDA for fiscal 2002
was $190.5 million, up from $162.2 million in fiscal 2001.

The Company accomplished its planned reduction of finished
engine inventory in fiscal 2002 and is planning similar targets
for engine inventory levels for the end of fiscal 2003.

On July 19, 2002 the Company announced it was going into
production on a five horsepower outboard motor.  Revenues and
operating income will not be significantly impacted in the first
year of production.  Because of the product's relatively
affordable price, we believe it has the potential to reach a
market segment of consumers that is not accessible to existing
outboard motor manufacturers with higher cost bases.

The U.S. Consumer Product Safety Commission is preparing to
announce that the Company has voluntarily agreed to recall
engines that it sold for fun-kart applications between 1992 and
1995.  The Company no longer sells engines for fun-kart
operations.  The entire estimated cost of the recall and a
related civil penalty imposed by the CPSC is reflected in fiscal
2002 net income at $1.5 million.

The Company's CEO and CFO plan to file the newly required
certifications on the fiscal 2002 financial results in
conjunction with the filing of Form 10-K in September 2002.

Outlook For Fiscal 2003:

The Company's current estimate for fiscal 2003 anticipates net
income of approximately $72 million.  Consolidated sales are
estimated to be up 4% between years.  Engine unit volume and mix
are projected to be similar between years so the majority of the
anticipated sales increase comes from a 2% price increase for
engines and expectations for increased volume in generators and
pressure washers at Generac.

Gross profit margin for the year is projected to be 19.6%.  This
rate reflects better engine plant utilization in fiscal 2003
resulting from successful efforts to control our inventory of
finished goods in fiscal 2002 through lower production.  The
Company believes engine production could be up 8-10% for the
year.  In addition, it continues to focus on control and
reduction of manufacturing costs.  Plans for fiscal 2003 include
reductions in costs that more than offset the effect of rising
cost categories such as health care.  Finally, Generac is
projected to benefit from higher volumes and lower operating
costs that reflect the impact of integration and cost cutting
efforts in fiscal 2002.

Operating expenses are estimated to be $167 million reflecting
increased product marketing plans and engineering for future
product development. Interest expense is estimated to be $42
million and we are assuming an effective tax rate of 34%.

The estimates for depreciation and capital expenditures are $60
million each.  EBITDA for fiscal 2003 is forecast to be
approximately $210 million.

                         *    *    *

As reported in Troubled Company Reporter's June 6, 2002 edition,
Standard & Poor's lowered its corporate credit rating on air-
cooled gasoline engine maker Briggs & Stratton Corp. to double-
'B'-plus from triple-'B'-minus, and removed all ratings from
CreditWatch where they had been placed on April 18, 2002. At the
same time, Standard & Poor's lowered its senior unsecured debt
and bank loan ratings, also to double-'B'-plus from triple-'B'-
minus. The downgrade reflects the company's weaker than expected
credit measures following its 2001 acquisition of Generac
Portable Products Inc.

"Despite some expected improvement in the company's fourth
fiscal quarter, Standard & Poor's remains concerned that Briggs
& Stratton's financial performance and credit protection
measures will not recover to or be sustained at levels
appropriate for a low investment grade rating over the medium
term," said Standard & Poor's credit analyst Jean C. Stout. This
concern, Standard & Poor's said, is also due to the increased
volatility of engine volume growth and the impact of economic
and weather conditions on Briggs & Stratton's products, combined
with existing high leverage.

The outlook for the Wauwatosa, Wisconsin-based Briggs & Stratton
is stable. The company had about $635 million of total debt
outstanding as of March 31, 2002.


BROADWAY TRADING: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------------
Lead Debtor: Broadway Trading, LLC
             417 Fifth Avenue
             6th Floor
             New York, NY 10016
             fka Marksmen Trading Partners, LLC

Bankruptcy Case No.: 02-13813

Debtor affiliates filing separate chapter 11 petitions:

     Entity                                     Case No.
     ------                                     --------
     Broadway Trading, LLC                      02-13813
     BT Holdings, Inc.                          02-13814
     JGM Securities, LLC                        02-13815
     Traders' Edge.net, LLC                     02-13817

Chapter 11 Petition Date: August 8, 2002

Court: Southern District of New York (Manhattan)

Judge: Cornelius Blackshear

Debtors' Counsel: William F. Gray, Esq.
                  Torys LLP
                  237 Park Avenue
                  New York, NY 10017
                  (212) 880-6000
                  Fax : (212) 682-0200

Estimated Assets: $10 to $50 Million

Estimated Debts: $10 to $50 Million

Debtor's 20 Largest Unsecured Creditors:

Entity                     Nature of Claim        Claim Amount
------                     ---------------        ------------
Watcher Technologies       Trade Debt --            $1,131,821
Alex Goor                  Technology Services
c/o Datek Online
70 Hudson Street
Jersey City, New Jersey 07302

Instinet Corp.             Trade Debt --            $1,107,470
3 Times Square             Technology Services
New York, New York 10036
Attn: Paul Mcrolla,
Jeff Letzler and
General Post Office
PO Box 26097
New York, NY 10087-6097

Robert Walford             Employee Compensation      $883,119
3 Van Wyck Lane
Lloyd Harbor, New York 11743

Marc McCord                Employee Compensation      $869,244
12 Woodbury Farms Drive
Woodbury, New York 11797

The NASDAQ Stock Market    Trade Debt --              $588,145
Inc.                      Technology Services
PO Box 7777-W9940
Philadelphia, PA 19175-9940
Avi Tele
(301) 978-4539

Spear Leeds & Kellog       Trade Debt --              $497,883
LiChi Hwu                  Technology Services
120 Broadway
20th Floor
New york, NY 10271
(212) 433-7601

The Brut ECN              Trade Debt --               $238,685
                          Technology Services

Archipelago LLC           Trade Debt --               $217,791
                          Technology Services

iCapital Markets          Trade Debt --               $198,497
                          Technology Services

B-Trade Services LLC      Trade Debt --               $190,772
                          Technology Services

The Island ECN            Trade Debt --               $184,719
                          Technology Services

Cushman & Wakefield Inc.  Trade Debt -- Rent           $96,292

AT&T                      Trade Debt -- Utility        $94,387

Market XT/Porter Capital  Trade Debt --                $93,427
Corp.                    Technology Services

GMR Capital Corp.         Trade Debt                   $93,272

Track-Data                Trade Debt --                $80,540
                          Technology Services

Piper Rudnick LLP         Trade Debt -- Attorney's     $62,982
                          Fees

Global Crossing           Trade Debt -- T1 Lines       $62,060

Standard & Poors          Trade Debt --                $45,008
                          Technology Services

Bradley Frericks          Employee Compensation        $41,195


BUDGET GROUP: Wants to Continue Use of Cash Management System
-------------------------------------------------------------
Budget Group Inc., and its debtor-affiliates, sought and
obtained the Court's approval to continue using its existing
cash management system.

Edward J. Kosmowski, Esq., at Young Conaway Stargatt & Taylor
LLP in Wilmington, Delaware, informs the Court that Budget Group
Inc. maintains a highly centralized finance function in that it
maintains only one Treasury, Tax and Controller department
covering all of its subsidiaries.  The Debtors operate an
integrated cash management system that relies heavily on inter-
company accounting and inter-company movement of funds.

The Cash Management System is an integrated, centralized network
of 146 bank accounts in the U.S. and an additional 14 bank
accounts outside the United States that facilitate the timely
and efficient collection, concentration, management and
disbursement of funds used by the Debtors.  In the normal course
of business, nearly all of the Debtors' funds flow into and out
of the main operating company, Budget Rent A Car Corporation.
The Debtors' cash is consolidated in a central Concentration
Account maintained by BRACC at Harris Bank.  The Concentration
Account is used to centralize the cash management and short-term
investments for the various rental locations of the Debtors'
operating entities.

Team Fleet Financing Corporation is a separate non-debtor entity
that maintains a stand-alone account structure outside of the
Cash Management System.

All of the Debtors' revenues are deposited to field depository
accounts that deposits daily on the Concentration Account.  The
field depository accounts are swept daily by ACH into the field
depository which then deposits into the Concentration Account.
Various corporate receivables are deposited into lockbox
accounts that also sweep into the field depository account and
then into the Concentration Account.  Franchisee royalty
payments are sent to a franchisee lockbox that flows directly
into the Concentration Account.  Ryder maintains a separate main
concentration account with Citibank that receives deposits from
various lockbox accounts and transfers amounts for accounts
payable to a master funding account held at PNC Bank.  Funds are
transferred daily between the Ryder's main Concentration Account
and the Concentration Account by manual wire process.

Funds are transferred from the Concentration Account into
disbursement accounts that are used for various purposes,
including general payroll and regional corporate field
disbursements.  Disbursements are made by check, wire transfer
or ACH debit.  The majority of these disbursement accounts are
zero-balance accounts and are funded directly and automatically
from the Concentration Account on an as-needed basis.  The
Debtors are also required to maintain separate disbursement
accounts for payment of the New York, California, Puerto Rico,
and Hawaii payrolls.

The Debtors also have stand-alone accounts at Harris Bank for
certain specialized disbursements like payroll taxes, DMV
registration payments, and fuel payments.  The accounts at
Harris Bank are funded through wire transfers from the
Concentration Account on an as-needed basis.

The Cash Management System outside of the United States is being
held through Budget Rent-A-Car International Inc. and consists
of seven accounts in the U.K., three accounts in Switzerland,
two accounts in South Africa, an account in Japan and an account
in Singapore.

BRACI's accounts in the U.K. are held with HSBC Holdings PLC and
facilitate the receipt and disbursement of funds between BRACH
and its non-debtor subsidiaries and franchisees throughout the
world.  BRACI's accounts in Switzerland are held with UBS AG.
The main Swiss account is used to process receipts and
disbursement from BRACI's vehicle rental operations in
Switzerland, while the two other Swiss accounts are used to
facilitate the purchase and sale of damaged fleet cars used in
the Swiss operations and Swiss payroll disbursements.

Both of BRACI's South African accounts, which are held at
Nedbank, are available to facilitate business activities in
South Africa.  The account in Japan is used for the operations
of BRACI's wholly-owned debtor subsidiary, Budget Rent A Car of
Japan, Inc., and similarly, the account in Singapore is used by
BRACI's wholly-owned debtor subsidiary, Budget Rent a Car
Asia-Pacific Inc.

One of the U K. accounts, known as the UK Credit Services
Account, receives deposits from UK, franchisees, licensees and
corporate customers in Sterling, some of which deposits relate
to receivables of BTI (U.K.) PLC, a non-debtor UK operating
subsidiary of BRACI that provides administrative services to
BRACI.  The UK Credit Services Account is swept overnight into a
BTI account, from which account BTI pays expenses on behalf of
both BRACH and itself.  BRACH and BTI are currently in the
process of imposing controls and adjusting their intercompany
accounting system to provide additional reporting relating to
this sweep mechanism.

In light of the substantial size and complexity of the Debtors'
operations, Mr. Kosmowski says, a successful reorganization of
the Debtors' businesses and the preservation and enhancement of
the Debtors' respective values as going concerns simply cannot
be achieved if the cash management procedures are disrupted.
The Cash Management System has been utilized by the Debtors for
at least 15 years.  It gives the Debtors numerous benefits
including the ability to:

   -- control and monitor corporate funds,

   -- invest idle cash,

   -- ensure cash availability, and

   -- reduce the administrative expenses by facilitating the
      movement of funds and the development of timely and
      accurate account balance and presentment information.

The Debtors' cash transactions managed through the Cash
Management System are projected to reach $250,000,000 to
350,000,000 per month. (Budget Group Bankruptcy News, Issue No.
2; Bankruptcy Creditors' Service, Inc., 609/392-0900)

DebtTraders reports that Budget Group Inc.'s 9.125% bonds due
2006 (BD06USR1) are quoted between 15 and 20. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=BD06USR1for
more real-time bond pricing.


CAITHNESS COSO: S&P Affirms BB Rating on $303M Sr. Secured Bonds
----------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its double-'B'
rating on Caithness Coso Funding Corp.'s $303 million senior
secured bonds, due 2009, and removed the rating from
CreditWatch. The outlook is developing.

The change in outlook reflects the potential for credit-strength
improvements at power offtaker Southern California Edison Co.
(SCE, BB/Developing/--).

Caithness Coso Funding Corp.'s rating was placed on CreditWatch
on December 21, 2000, as Standard & Poor's ratings on SCE fell
below investment grade. Standard & Poor's recently upgraded
various SCE debt issues as a result of a settlement in federal
court between SCE and the California Public Utility Commission
(CPUC) over recovery of purchased power costs. Nonetheless, the
continuing regulatory and political uncertainties that dominate
the credit profile for SCE keep the outlook developing for
Caithness Coso Funding Corp.

The CPUC settlement removes the immediate, but not the longer
term, threat of a bankruptcy filing, voluntary or otherwise,
that has confronted SCE for over a year. While Standard & Poor's
had expected that the regulatory situation would become clearer
by now (and indeed the CPUC represented that it entered into the
settlement with the goal of restoring SCE's creditworthiness to
investment grade), it is still impossible to determine SCE's
long-term creditworthiness.

Caithness Coso Funding is the funding vehicle for three 80 MW
geothermal power projects in California--the Navy I, Navy II,
and BLM facilities--that are owned by several different
partnerships and collectively known as the Coso partnership
projects.


CALYPTE BIOMEDICAL: Townsbury Investments Acquires 900K Shares
--------------------------------------------------------------
On July 23, 2002, Calypte Biomedical Corporation issued a draw
down notice to Townsbury Investments Limited in connection with
the common stock purchase agreement dated August 23, 2001
evidencing a standby equity-based credit facility between the
Company and TIL.  This notice required TIL to purchase up to
$177,056 of Calypte's common stock under a pricing formula in
the stock purchase  agreement.  The settlement period began on
July 24, 2002, ended on July 31, 2002, and settled on August 2,
2002. At the final settlement date on August 5, 2002, TIL
purchased a total of 900,950  shares of Calypte's common stock
at an average purchase price of $0.196 per share, resulting in
proceeds of $167,203 net of brokerage and escrow fees. Ladenburg
Thalmann & Co., received $8,853 in brokerage fees and the escrow
agent received $1,000 in escrow fees in connection with this
drawdown.

Because TIL may sell some or all of these shares, and because
there are currently no agreements,  arrangements or
understandings with respect to the sale of any of these shares,
the Company cannot estimate the actual amount of shares that
they will hold after the completion of the offering.

Calypte will not receive any of the proceeds from the sale of
shares by TIL. However, it did receive the sale price of common
stock sold to TIL. The Company expects to use the proceeds of
the sale of common stock for general corporate purposes.

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


CASTLE DENTAL: Closes Debt Workout Transaction with Sr. Lenders
---------------------------------------------------------------
Since June 2000, Castle Dental Centers, Inc. has been in default
under:

- its bank credit agreement with its senior secured lenders;

- its senior subordinated notes and subordinated convertible
  notes issued to Heller Financial, Inc. and Midwest Mezzanine
  Fund II, L.P.; and

- its subordinated notes and other subordinated indebtedness
  issued to various sellers of dental practices to the Company.

On July 19, 2002, the Company entered into a restructuring with
its Senior Secured Lenders and its Senior Subordinated Lenders
regarding the debt outstanding under the Old Credit Agreement,
the Senior Subordinated Notes and the Old Notes. Pursuant to the
Restructuring, the Company has:

- exchanged 32,002 shares of Convertible Preferred Stock, Series
  A-1, par value $.001 per share, for $3,624,771 in aggregate
  principal and interest of its Old Notes;

- exchanged 179,280 shares of Series A-1 Stock for $17,928,000
  in aggregate principal and interest of the Senior Subordinated
  Notes;

- amended and restated the Old Credit Agreement;

- issued warrants to purchase 60,859 shares of Convertible
  Preferred Stock, Series A-2, par value $.001 per share, to the
  Senior Secured Lenders;

- borrowed $1,700,000 from the Senior Subordinated Lenders and
  James M. Usdan

- issued convertible notes with an aggregate principal amount of
  $1,700,000 evidencing the amount borrowed from the New Money
  Lenders which notes are initially convertible into 3,105,618
  shares of the Company's common stock, par value $.001 per
  share; and

- issued warrants to purchase 17,974,062 shares of common stock
  to the New Money Lenders.

Heller exchanged $11,952,000 in aggregate principal and interest
of Senior Subordinated Notes for 119,520 shares of Series A-1
Stock. In its capacity as Senior Secured Lender, Heller was
issued warrants to purchase 10,984 shares of Series A-2 Stock in
exchange for entering into the amendment and restatement of the
Old Credit Agreement. In addition, Heller loaned $500,000 to the
Company in exchange for a $500,000 note initially convertible
into 913,417 shares of common stock and warrants to purchase
5,286,489 shares of common stock. Heller financed this loan with
its working capital.

Midwest exchanged $5,976,000 in aggregate principal and interest
of Senior Subordinated Notes for 59,760 shares of Series A-1
Stock. Midwest also loaned $500,000 to the Company in exchange
for a $500,000 note initially convertible into 913,417 shares of
common stock and warrants to purchase 5,286,489 shares of common
stock. Midwest financed this loan with its working capital.

James M. Usdan, the Company's Chief Executive Officer, loaned
$700,000 to the Company in exchange for a $700,000 note
initially convertible into 1,278,784 shares of common stock and
a warrant to purchase 7,401,084 shares of common stock. Mr.
Usdan financed this loan with personal funds.

Each share of Series A-1 Stock and Series A-2 Stock is currently
convertible into 182.7 shares of common stock and, once issued,
votes on an "as converted" basis on all matters submitted to the
holders of common stock of the Company. Holders of Series A-1
Stock, voting separately as a class, are entitled to elect a
majority of the directors of the Company. Heller's 119,520
shares of Series A-1 Stock currently represent approximately
48.5% of the Company's outstanding voting stock and Midwest's
59,760 shares of Series A-1 Stock currently represent
approximately 24.3% of the Company's outstanding voting stock.

If Heller's convertible note were converted into common stock,
its warrant to purchase common stock were exercised in full, and
its warrant to purchase Series A-2 Stock were exercised in full,
Heller would be able to cast 30,040,825 votes on all matters
submitted to stockholders for a vote. If Midwest's convertible
note were converted into common stock and its warrant to
purchase common stock were exercised in full, Midwest would be
able to cast 17,117,068 votes on all matters submitted to
stockholders for a vote. The 6,417,206 shares of common stock
and 211,282 shares of Series A Stock currently outstanding have
the aggregate ability to cast 45,014,928 votes on all matters
submitted to stockholders for a vote.

In connection with the Restructuring, the Company and the New
Money Lenders entered into an Investor Agreement which provides
that the Company's Board of Directors will consist of five
persons and that Heller is entitled to designate two directors,
Midwest is entitled to designate one director, and the Chief
Executive Officer of the Company will serve as a director.
Pursuant to the Investor Agreement, Heller has designated Ira
Glazer and Midwest has designated Paul Kreie to serve on the
Company's Board of Directors. In addition, Mr. Usdan, the
Company's Chief Executive Officer and a current director, and
Edward Kuntz have been designated to serve on the Company's
Board of Directors pursuant to the Investor Agreement. Heller
will designate a fifth director to serve on the Company's Board
of Directors by October 2, 2002. Robert J. Cresci, G. Kent Kahle
and Emmett E. Moore have resigned as directors of the Company
effective on the tenth day following the mailing of an
information statement required by Section 14(f) of the
Securities Exchange Act of 1934 to the stockholders of the
Company. The Board of Directors has appointed the designees
described above to the Board of Directors of the Company to fill
the positions vacated by the three resigning directors effective
on the tenth day following the mailing of the Information
Statement to the stockholders of the Company.

Castle Dental Centers manages and operates dental practice
networks in California, Florida, Tennessee, and Texas; its
centers in Texas account for some two-thirds of sales. The
company provides nondental management services to some 100
dental centers, which include general, orthodontic, and
multispecialty dental practices. Its administrative management
services include marketing and sales, human resources services,
equipment supply, insurance services, and financial and
accounting reporting and administration.

The company posted a total working capital deficit of about $68
million on March 31, 2002.


CEDARA SOFTWARE: Names Abe Schwartz to the Board of Directors
-------------------------------------------------------------
Michael M. Greenberg, Chairman and Chief Executive Officer of
Cedara Software Corp. (TSX:CDE/Nasdaq:CDSW), announced that
Abe Schwartz has been appointed to Cedara's Board of Directors,
and that William Breukelman has resigned from the Board.

Abe Schwartz, President of Schwartz Technologies Inc., a company
active in the development of emerging growth companies, has a
unique background as an entrepreneur and has been active in the
start-up and management of growth companies, primarily in the
software industry, for over 25 years.  Mr. Schwartz' first
start-up was Polaris Technology Corporation, a computer software
firm which he founded in 1977 and which he sold to Crowntek
Inc., in 1983. In 1987, Mr. Schwartz founded Schwartz
Technologies Corporation where he has developed a unique
methodology for successfully launching and growing start-ups. In
1993, Schwartz Technologies Corporation co-founded the Workflow
Automation Corporation, which achieved breakthroughs in web-
based software, and was sold to BEA Systems Inc. of San Jose in
2000.

"We are excited that Abe is joining our Board and is adding his
skills and experience to support the growth and success of the
Company," stated Michael Greenberg.

"On behalf of the Board and management, I would like to thank
Bill for his long valuable service and contributions as a
director over the last seven years. We have benefited from the
presence of Bill's wisdom, and will continue to draw on the
perspectives he imparted as we move forward," Michael Greenberg
also stated.

Cedara Software Corp., is a leading provider of medical imaging
software serving healthcare solution providers world-wide and is
positioned to deliver sustainable software value to its Original
Equipment Manufacturer (OEM) and Value Added Reseller (VAR)
partners.

Cedara's software enables healthcare devices and information
technology to perform medical imaging, image distribution,
diagnostic review and therapy guidance.

At December 31, 2001, Cedara Software reported a working capital
deficit of close to CDN$10 million, and a total shareholders'
equity deficit of CDN$99.8 million.


CHARMING SHOPPES: Reaffirms Earnings Guidance for Second Quarter
----------------------------------------------------------------
Charming Shoppes, Inc., (Nasdaq: CHRS), the retail apparel chain
specializing in women's plus-size apparel, reported that total
sales for the four weeks ended August 3, 2002 increased 50%
percent to $168,300,000 from $112,300,000 for the comparable
four weeks ended August 4, 2001. The current period's total
sales include sales from Lane Bryant, which was acquired August
16, 2001. Comparable store sales for Charming Shoppes, Inc., on
a consolidated basis, decreased 3% for the four weeks ended
August 3, 2002.

Total sales for the thirteen weeks ended August 3, 2002
increased 59% percent to $631,500,000 from $397,100,000 for the
comparable thirteen weeks ended August 4, 2001. Comparable store
sales for Charming Shoppes, Inc., on a consolidated basis,
increased 1% for the thirteen weeks ended August 3, 2002.

Commenting on the second quarter, Dorrit J. Bern, Chairman, CEO
and President said, "Strong inventory management, coupled with
early sell throughs in our summer merchandise, resulted in
higher merchandise margins for the quarter versus a year ago.
At the end of the quarter, inventory of summer merchandise,
across all brands, was down double digits as compared to the
prior year."

Total sales for the twenty-six weeks ended August 3, 2002
increased 59% percent to $1,262,400,000 from $791,500,000 for
the comparable twenty-six weeks ended August 4, 2001. Comparable
store sales for Charming Shoppes, Inc., on a consolidated basis,
were flat for the twenty-six weeks ended August 3, 2002.

For more detailed information on monthly sales, please call 1-
866-CHRS- NEWS (1-866-247-7639) to listen to Charming Shoppes,
Inc.'s prerecorded monthly sales commentary.  This recording
will be available until August 12, 2002.

The Company has reaffirmed earnings per share projections for
second quarter and fiscal year 2003 in ranges of approximately
$0.17 to $0.19, and $0.41 to $0.43, respectively.

Charming Shoppes, Inc., will host its Second Quarter Fiscal 2003
earnings conference call on Tuesday, August 20, 2002, at 9:15 am
(EDT).  Second quarter earnings results will be released over
the newswires prior to 9:15 am (EDT).

To listen to the conference call, please dial 1-888-689-9348
followed by the passcode 2594# approximately 10 minutes prior to
the scheduled event.  The conference call will also be simulcast
at www.companyboardroom.com and can be accessed by going to the
ticker symbol (CHRS) and clicking on the speaker icon in the
"listen" column. The general public is invited to listen to the
conference call via the webcast or the dial-in telephone number.

Charming Shoppes, Inc., operates 2,334 stores in 48 states under
the names LANE BRYANT(R), FASHION BUG(R), FASHION BUG PLUS(R),
CATHERINE'S PLUS SIZES(R), MONSOON(R) and ACCESSORIZE(R).
Monsoon and Accessorize are registered trademarks of Monsoon
Accessorize Ltd.  During the twenty-six weeks ended August 3,
2002, the Company opened 32, relocated 14, converted 9 and
closed 125 stores.  Please visit http://www.charmingshoppes.com
for additional information about Charming Shoppes, Inc.

                          *    *    *

As reported in Troubled Company Reporter's May 24, 2002 edition,
Standard & Poor's assigned BB- rating to Charming Shoppes' $130
million Senior Unsecured Notes.


CONSECO INC: Lazard and Kirkland Called-In for "Radical Change"
---------------------------------------------------------------
Gary Wendt, Chairman and CEO of Conseco, Inc. (NYSE:CNC), issued
the following statement to the company's stakeholders:

"Our board of directors has met several times over the past
two weeks to consider various financial options available to
the company. We have concluded that the barriers to further
progress on our Turnaround plan now require a different
approach.

"Our judgment is that the continued gradual financial
restructuring that was the goal of the Turnaround plan is no
longer the best course. Rather, 'radical change in the company's
capital structure' - as one rating agency called for last week -
is required.

"To that end, we are taking the following actions:

     1. We are exercising a 30-day grace period on upcoming bond
        interest payments; and

     2. We are engaging:

          * Lazard Freres & Co. as financial advisors and

          * Kirkland & Ellis as legal advisors

        for the purpose of beginning immediate discussions with
        our debt holders with a goal of restructuring the
        capital of the parent company.

"We cannot emphasize strongly enough our continued belief that
the Insurance and Finance businesses that comprise Conseco are
profitable businesses that serve important markets. The
businesses of Conseco are good businesses that can have bright
futures. The problem with Conseco has been the over-leveraged
capital structure of the parent. Two other important points:
First, none of our operating subsidiaries will be directly
involved in the planned restructuring; and, second, we are
comfortable that we will have more than ample liquidity to
operate our businesses throughout this restructuring period.

"Finally we note that time is of the essence. In order to
maximize the value of our businesses, we intend to move
quickly to agree on an appropriate restructuring with all
interested parties.

"In the next few days and weeks, we will be meeting with
regulators, rating agencies and other stakeholders to
articulate further our plan for this comprehensive
restructuring."

DebtTraders reports that Conseco Inc.'s 10.500% bonds due 2004
(CNC04USR2) are trading between 25 and 30. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=CNC04USR2for
more real-time bond pricing.


CORNERSTONE: Will Commence Trading on OTCBB Under CNPP Symbol
-------------------------------------------------------------
CornerStone Propane Partners, L.P., expects its common units to
commence trading on the "Over-the-Counter Bulletin Board under
the ticker Symbol "CNPP" on or after August 9, 2002.  The
Partnership's common units were previously traded on the New
York Stock Exchange under the ticker symbol.

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


CRESCENT REAL: Second Quarter Results Meet Targets and Guidance
---------------------------------------------------------------
Crescent Real Estate Equities Company (NYSE:CEI) announced
results for the second quarter 2002. Funds from operations for
the three months ended June 30, 2002 was $53.2 million, which
met the Company's guidance and analyst consensus. FFO for the
six months ended June 30, 2002 was $117.3 million. These compare
to $81.4 million, for the three months ended June 30, 2001 and
$153.6 million for the six months ended June 30, 2001.

According to John C. Goff, Chief Executive Officer, "We are
pleased to have met our earnings expectation for the second
quarter. While we look forward to a recovery in the national
economy, we feel the company is well positioned in the current
environment and will quickly benefit when the recovery occurs.
We recently completed a $500 million capital raising initiative
which strengthened our balance sheet, addressed our significant
debt maturities through 2004, and created substantial liquidity,
which will allow us to take advantage of investment
opportunities as they arise."

Net income available to common shareholders for the three months
ended June 30, 2002 was $6.7 million. Net income available to
common shareholders for the six months ended June 30, 2002 was
$17.3 million. These compare to $11.6 million for the three
months ended June 30, 2001 and $39.5 million for the six months
ended June 30, 2001. In accordance with SFAS 144, gains of $.01
per share and $.04 per share related to office property sales
were recorded as discontinued operations for the three months
and six months ended June 30, 2002, respectively.

                    Business Sector Review

Office Sector (67% of Gross Book Value of Real Estate Assets as
of June 30, 2002)

Office property same-store net operating income declined 1.5%
for the three months ended June 30, 2002 over the same period in
2001 for the 25.7 million square feet of office property space
owned during both periods. Average occupancy for these
properties for the three months ended June 30, 2002 was 89.6%
leased compared to 92.6% leased for the same period in 2001. As
of June 30, 2002, the overall office portfolio was 90.4% leased
based on executed leases. During the three months ended June 30,
2002 and 2001, Crescent received $0.6 million and $2.3 million,
respectively, of lease termination fees. Crescent's policy is to
exclude lease termination fees from its same-store NOI
calculation.

Office property same-store NOI declined 1.0% for the six months
ended June 30, 2002 over the same period in 2001 for the 25.7
million square feet of office property space owned during both
periods. Average occupancy for these properties for the six
months ended June 30, 2002 was 89.8% leased compared to 92.6%
leased for the same period in 2001. During the six months ended
June 30, 2002 and 2001, Crescent received $1.8 million and $4.0
million, respectively, of lease termination fees.

The Company leased 807,000 net rentable square feet during the
three months ended June 30, 2002, of which 473,000 square feet
was renewed or re-leased. The weighted average FFO net effective
rental rate (rental rate less operating expenses) increased 4%
over the expiring rates for the renewed or re-leased leases, all
of which have commenced or will commence within the next twelve
months. Tenant improvements related to these leases were $1.73
per square foot per year and leasing costs were $.92 per square
foot per year.

The Company leased 1.9 million net rentable square feet during
the six months ended June 30, 2002, of which 1.1 million square
feet was renewed or re-leased. The weighted average FFO net
effective rental rate (rental rate less operating expenses)
increased 9% over the expiring rates for the renewed or re-
leased leases, all of which have commenced or will commence
within the next twelve months. Tenant improvements related to
these leases were $1.06 per square foot per year and leasing
costs were $.67 per square foot per year.

Denny Alberts, President and Chief Operating Officer, commented,
"Although the national office market is challenging, we are
encouraged by the leasing velocity that we are seeing in
Houston. We have already signed or are in negotiations for 70%
of our leases expiring in Houston this year. Also, we have
recently signed two very important new customers - one is a
Houston company moving to Greenway Plaza for 215,000 square feet
and the other is a company relocating its headquarters to 5
Houston Center for 30,000 square feet. Further, we are in
serious negotiations with various existing customers for over 1
million square feet in Houston that, if consummated, would have
a positive impact to 2003 operating performance. In 2002, we
believe our office segment will produce between $320 million and
$329 million in FFO."

On May 29, 2002, Crescent closed on the sale of two buildings
within The Woodlands Commercial Properties Company, L.P.,
Venture Tech II and III, totaling 99,000 square feet. The sale
generated net proceeds and gain to Crescent of $3.2 million and
$1.9 million, respectively.

On August 1, 2002, Crescent closed on the sale of 6225 N. 24th
Street, a 86,000 square foot office building located in the
Camelback Corridor of Phoenix. The sale generated net proceeds
and gain to Crescent of $9.0 million and $1.3 million,
respectively. Resort and Residential Development Sector (22% of
Gross Book Value of Real Estate Assets as of June 30, 2002)
Destination Resort Properties Based on actual performance of
Crescent's five resort properties, same-store NOI declined 2%
for the three months ended June 30, 2002 over the same period in
2001. The average daily rate decreased 5% and revenue per
available room decreased 8% for the three months ended June 30,
2002 compared to the same period in 2001. Weighted average
occupancy was 63% for the three months ended June 30, 2002
compared to 65% for the three months ended June 30, 2001.

Based on actual performance of Crescent's five resort
properties, same-store NOI declined 7% for the six months ended
June 30, 2002 over the same period in 2001. The average daily
rate decreased 1% and revenue per available room decreased 6%
for the six months ended June 30, 2002 compared to the same
period in 2001. Weighted average occupancy was 69% for the six
months ended June 30, 2002 compared to 72% for the six months
ended June 30, 2001.

            Upscale Residential Development Properties

According to Alberts, "Our overall residential investment
generated $12.5 million in FFO for the second quarter, which was
in line with our expectation. After extensive operating reviews
with our residential partners, we believe that our overall
residential business will deliver between $61 million and $65
million in FFO this year. Last year the overall residential
business delivered $54 million in FFO."

Investment Sector (11% of Gross Book Value of Real Estate Assets
as of June 30, 2002)

                Business-Class Hotel Properties

Based on actual performance of Crescent's four business-class
hotel properties, same-store NOI increased 7% for the three
months ended June 30, 2002 over the same period in 2001. The
average daily rate decreased 3%, while revenue per available
room increased 1% for the three months ended June 30, 2002
compared to the same period in 2001. Weighted average occupancy
was 75% for the three months ended June 30, 2002 compared to 72%
for the three months ended June 30, 2001.

Based on actual performance of Crescent's four business-class
hotel properties, same-store NOI declined 5% for the six months
ended June 30, 2002 over the same period in 2001. The average
daily rate decreased 4%, while revenue per available room
decreased 7% for the six months ended June 30, 2002 compared to
the same period in 2001. Weighted average occupancy was 70% for
the six months ended June 30, 2002 compared to 72% for the six
months ended June 30, 2001.

            Temperature-Controlled Logistics Investment

AmeriCold Logistics' same-store EBITDAR (earnings before
interest, taxes, depreciation and amortization, and rent)
remained flat for the three months ended June 30, 2002, compared
to the same period in 2001. AmeriCold Logistics elected to defer
$6.2 million (of the $33.9 million contracted rent) for the
second quarter, of which Crescent's share was $2.5 million.

AmeriCold Logistics' same-store EBITDAR (earnings before
interest, taxes, depreciation and amortization, and rent)
remained flat for the six months ended June 30, 2002, compared
to the same period in 2001. AmeriCold Logistics elected to defer
$9.3 million (of the $69.0 million contracted rent) for the
first six months of 2002, of which Crescent's share was $3.7
million. Crescent recognizes rental income when earned and
collected and has not recognized the $3.7 million deferral in
its equity in net income.

                     Balance Sheet Review

On April 15, 2002, Crescent's operating partnership completed a
private offering of $375 million in 9.25% senior, unsecured
notes due 2009. Proceeds were used to repay existing
indebtedness and redeem preferred units of one of its
subsidiaries.

On April 26, 2002, Crescent completed a preferred stock issuance
of 2.8 million shares of its 6.75% Series A convertible
cumulative preferred stock to an institutional investor.
Proceeds of $50 million were used to redeem preferred units of
one of its operating partnership subsidiaries.

On May 10, 2002, Crescent completed a 9.5% Series B cumulative
redeemable preferred stock issuance, which, including the
underwriters' exercise of an over-allotment option, totaled 3.4
million shares. Proceeds of $85 million were used to redeem
preferred units of one of its operating partnership
subsidiaries.

In June 2002, the Company repurchased 1.5 million of its common
shares at an average price of $19.00 per share, for a total
purchase price of $28.5 million. From inception of the original
program in late 1999 to date, the Company has repurchased
approximately 20.3 million shares, or 16.6% of the Company's
outstanding common shares at December 31, 1999. The average
price per share was $19.04, for a total purchase price of $387
million. Repurchases are made in the open market at prevailing
prices or in privately negotiated transactions.

                         2002 Outlook

Crescent's management expects 2002 FFO in the lower end of its
original guidance range of $2.00 to $2.30 per share. Included in
the Company's second quarter supplemental and operating
financial data report is 2002 guidance by business segment, and
based on this information, we expect 2002 FFO to be in the range
of $2.00 to $2.10 per share. For the third quarter 2002 we
expect FFO to be in the range of $.40 to $.45 per share.

            Supplemental Operating and Financial Data

Crescent's supplemental and operating financial data report for
the second quarter is available on the Company's Web site --
http://www.cei-crescent.com-- in the investor relations
section. To request a hard copy, please call the Company's
investor relations department at (817) 321-2180.

Crescent Real Estate Equities Company (NYSE:CEI) is one of the
largest publicly held real estate investment trusts in the
nation. Through its subsidiaries and partners, Crescent owned
and managed, as of June 30, 2002, a portfolio of 74 premier
office buildings totaling over 28 million square feet and
centered in the Southwestern United States, with major
concentrations in Dallas, Houston, Austin and Denver. In
addition, the company invests in world-class resorts and spas
and upscale residential developments. With award-winning
customer service and industry-leading amenities, Crescent offers
an exceptional experience at every property, every day.

                         *    *    *

As reported in the April 3, 2002 edition of Troubled Company
Reporter, Standard & Poor's affirmed its ratings on Crescent
Real Estate Equities Co., and Crescent Real Estate Equities
L.P., and removed them from CreditWatch, where they were placed
on Jan. 23, 2002.  The outlook remains negative.

Crescent's financial profile is weak, with low coverage measures
and a largely encumbered portfolio that limits financial
flexibility. The company's core office portfolio performance has
been fairly stable but is highly concentrated in markets with
current weak fundamentals. Sustained portfolio weakness, coupled
with the potential for meaningful activity on the company's
share repurchase program (which has over $400 million
remaining), could stress financial measures further, prompting a
one-notch downgrade. Alternatively, a return to stable would be
driven by successful portfolio performance, despite the current
market softness, and a demonstrated commitment by management to
a more conservative financial profile with a tempered policy
toward share repurchases.

       Ratings Affirmed And Removed From CreditWatch

     Issue                           To            From

Crescent Real Estate Equities Co.
   Corporate credit rating          BB            BB/Watch Neg
   $200 million 6-3/4%
      preferred stock               B             B/Watch Neg
   $1.5 billion mixed shelf  prelim B/B+   prelim B/B+/Watch Neg

Crescent Real Estate Equities L.P.
   Corporate credit rating          BB            BB/Watch Neg
   $150 million 6 5/8% senior
      unsecured notes due 2002      B+            B+/Watch Neg
   $250 million 7 1/8% senior
      unsecured notes due 2007      B+            B+/Watch Neg


DADE BEHRING: Wants to Pay Essential Vendors' Prepetition Claims
----------------------------------------------------------------
Dade Behring Holdings, Inc., asks the U.S. Bankruptcy Court for
the Northern District of Illinois for permission to
provisionally pay, in the ordinary course of business,
prepetition claims of essential trade creditors.

The Debtors seek limited discretionary authority to pay certain
prepetition trade claims of Essential Trade Creditors, up to an
aggregate amount of $14.7 million.  This cap represents
approximately 71% of the Debtors' estimate of $20.7 million
prepetition trade claims in the aggregate.

The Debtors relate to the Court that they purchase specialized
goods, equipment and services from certain vendors, both foreign
and domestic. The Debtors' relationships with these Essential
Trade Creditors are crucial to create future revenue. The
Debtors' obligations include obligations to:

     (i) suppliers of raw materials, finished components and
         services used in manufacturing various product
         offerings,

    (ii) insurance companies,

   (iii) information service providers,

    (iv) providers of nonprofessional services and

     (v) suppliers of finished goods purchased for resale.

The Debtors point out that they have very little discretion in
choosing or changing suppliers since the Food and Drug
Administration regulates in vitro diagnostic medical device
manufacturers to minimize raw material or component failure that
may cause medical instrument recalls.

Many of the Debtors' vendors manufacture custom made products
for the Debtors or manufacture products that the Debtors resell
to their customers. In many instances, these vendors are the
Debtors' sole supplier of certain component parts because they
hold the specific molds, tooling and fixtures for Debtors'
closed system patented medical diagnostic instruments. In
addition, some of these suppliers have proprietary technology
that cannot be duplicated elsewhere.

Other vendors supply biological, chemical or pharmaceutical
materials for the Debtors' tests and panels which are patented,
or which have to be rigorously tested by the Debtors to ensure
that these materials meet the specifications.  Furthermore,
numerous components that go into the Debtors' finished products
contain perishable biological materials and must be maintained
at specific temperature levels until received by the ultimate
customer. Because of the perishable nature of these biological
materials and because the Debtors have sought to keep inventory
levels low in order to conserve cash, the Debtors maintain less
than 30 days inventory levels on certain key products.

The Debtors further point out that many of their vendors are
small, specialized manufacturers that often are small businesses
and are the sole available source for materials the Debtors
purchase for use in their medical instruments, any disruption
would cause enormous economic hardship on these vendors as well.

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. Of the total estimated $20 billion annual global IVD
market, the Debtors serve a $12 billion segment targeted
primarily at clinical laboratories. The Company filed for
chapter 11 protection on August 1, 2002. James Sprayregen, Esq.,
at Kirkland & Ellis represents the Debtors in their
restructuring efforts.


ELCOM INT'L: Hosts First U.K. Public Sector Online Auction
----------------------------------------------------------
Elcom International, Inc. (Nasdaq: ELCO), a leading
international provider of remotely-hosted eProcurement
marketplace solutions, announced that the Environment Agency of
the United Kingdom has successfully conducted its first ever
online OJEC compliant auction for the supply of environment
friendly "Green Electricity" supply using Elcom's Dynamic Trade
Centre.

Conducted in partnership with Cap Gemini Ernst & Young UK plc,
the electronic auction was conducted as part of the eProcurement
pilot programme being managed by the British Office of
Government Commerce. The process prior to the reverse auction
event followed the EU procurement directive process, with the
OJEC notice being issued in March 2002. Six expressions of
interest were received by the closing date. Bidders included
British Gas, London Electricity, Bizz Energy and Scottish &
Southern Energy.

Amanda Hadgkiss, the Environment Agency's Regional Procurement
Manager for the Midlands region and contract manager for the
Agency's energy contracts, stated, "The amount of effort
required to prepare and run the auction was about the same as
using the traditional approach.  The commodity being auctioned
was the supply of electricity to sub 100kw sites, for 100%
Climate Change Levy exempt, or "Green" energy, to 366
Environment Agency sites within the Agency's Anglian region."

Peter Thomas, Procurement Strategy Manager at the Environment
Agency, commented, "Electricity is a complex commodity and if
this can be auctioned successfully, we will be able to auction
just about anything.  By using Elcom's Dynamic Trading Centre,
we were able to deliver substantial cost savings in the
procurement of this energy."

Martin Cook, Vice President at Cap Gemini Ernst & Young,
commented, "The purpose of conducting this reverse auction was
to determine proof of concept of the use of eAuctions in the
public sector and to inform the development of public policy in
the UK and Europe as a whole. The team, comprised of the
Environment Agency, Cap Gemini Ernst & Young and Elcom, have
completed a successful event, auctioning a complex commodity and
have obtained a great result in the process. This has been
achieved whilst complying fully with all EU procurement
directives.  I think that we can now regard eAuctions as an
effective public sector procurement tool."

Bob Bradbury, Public Sector Manager of Cap Gemini Ernst & Young,
added, "Elcom's eNegotiation system worked very effectively and
efficiently and required no advanced training. The success of
this online auction for the Environment Agency combined with
Elcom's Dynamic Trade Centre system is a strong testimony to the
level of commitment that has been put forth for U.K. government
eCommerce initiatives. We are pleased to be an integral part of
this program along with Elcom."

Robert J. Crowell, Elcom International, Inc.'s Chairman and CEO,
stated, "The Environment Agency's decision to use Elcom's
Dynamic Trade Centre to conduct its first ever public sector
online auction was a strong vote of confidence for our
solutions. As the Office of Government Commerce drafts its Final
Report on its eProcurement pilot program, it is a positive sign
that the agency elected to test our Dynamic Trade Centre. We
were confident that Elcom and Cap Gemini Ernst & Young could
deliver additional benefits and cost savings to the Environment
Agency during this phase of the pilot program."

Michael Templeman, Elcom Systems' Managing Director
International, stated, "It's obviously a feather in Elcom's cap
that our technology was chosen to conduct the UK's first ever
OJEC compliant, public sector eAuction.  Our system performed
flawlessly, ultimately generating significant savings over what
might have been achievable previously.  We are delighted to have
the opportunity to prove once again, that eProcurement delivers
what it promises."

                      Elcom Product Offerings

The Dynamic Trade Centre is Elcom's eNegotiation engine and is
operated as a sourcing service on the Elcom eCommerce Network,
enabling trading partners to participate in trading partner
discovery and to leverage global competition to stimulate price
reductions. The Dynamic Trade Centre offers trading partners a
number of complex, online negotiation options that include
forward and reverse auction, request for quotation, offer to
sell and sealed bid. By supporting multiple trade models, the
Dynamic Trade Centre enables trading partners to select the
trade model which best suites the product or service they are
seeking to buy or sell.  The Elcom eCommerce Network enables the
delivery of functionally rich yet affordable eProcurement and
eMarketplace solutions by providing access to specific shared
capabilities that reside on our hosted network. Elcom's Dynamic
Trade Centre is a global eSourcing service of the Elcom
eCommerce Network that enables Elcom's eProcurement and
eMarketplace customers to conduct online negotiation of items
for purchase or sale with trading partners.

For further detailed information on Elcom's PECOS solutions,
please visit Elcom's Web site at
www.elcominternational.com/products.htm

The Environment Agency was set up by the 1995 Environment Act as
a non- departmental public body, which is sponsored largely by
the Department for Environment, Food & Rural Affairs and the
National Assembly for Wales to improve the land, air and water
environment. The Environment Agency is divided into eight
regions that provide both a focus of co-ordination and technical
and administrative support to the 26 area offices across England
and Wales. The Environment Agency is comprised of over 10,500
staff and an annual budget of #650 million. Additional
information can be found at http://www.environment-agency.gov.uk

The OGC has been set up to lead a wide-ranging programme to
modernize procurement in government.  Working at the heart of
government, OGC is developing an integrated procurement policy
and strategy across the UK government. OGC represents the UK on
procurement matters in Europe, in the World Trade Organization
and other international areas.

In close co-operation with departments, OGC is taking a fresh
approach to many important aspects of procurement policy and
practice. By improving performance, OGC is helping government to
realize 'Value for Money' in procurement.  OGC offers customers
and suppliers integrated, flexible and responsive support for
all aspects of procurement and supplier management in central
civil government. By working with departments and suppliers OGC
will help departments achieve value for money improvements in
commercial activities across government.  Further information on
the OGC is available at http://www.ogc.gov.uk

The Cap Gemini Ernst & Young Group is one of the largest
management and IT consulting organizations in the world. The
company offers management and IT consulting services, systems
integration, and technology development, design and outsourcing
capabilities on a global scale to help businesses continue to
implement growth strategies and leverage technology. The
organization employs around 55,000 people worldwide and reported
2001 global revenues of more than 8.4 billion euros.

More information about individual service lines, offices and
research is available at http://www.cgey.com

Elcom International, Inc. (Nasdaq: ELCO), operates two wholly-
owned subsidiaries: elcom, inc., a leading international
provider of remotely-hosted eProcurement and Private
eMarketplace solutions and Elcom Services Group, Inc., which is
managing the transition of the recent sale of certain of its
assets and  customer base.  elcom, inc.'s innovative remotely-
hosted technology establishes the next standard of value and
enables enterprises of all sizes to realize the many benefits of
eProcurement without the burden of significant infrastructure
investment and ongoing content and system management.  PECOS
Internet Procurement Manager, elcom, inc.'s remotely-hosted
eProcurement and eMarketplace enabling platform was the first
"live" remotely- hosted eProcurement system in the world.
Additional information can be found at
http://www.elcominternational.com

                         *     *     *

As reported in Troubled Company Reporter's August 5, 2002,
edition, the Company's common stock currently trades on the
Nasdaq National Market. Since April 1, 2002, the closing bid
price of the Company's common stock has not exceeded $1.00 per
share.  On May 14, 2002, the Company received notice from Nasdaq
that, for continued listing on the Nasdaq National Market, the
Company is required to comply with the $1.00 minimum bid
requirement for 10 consecutive trading days by August 12, 2002
or be subject to delisting from the Nasdaq National Market.
Alternatively, the Company may apply to transfer its common
stock to the Nasdaq SmallCap Market.  The Company believes that
it currently meets all of the listing requirements of the Nasdaq
SmallCap Market, with the exception of the $1.00 minimum bid
price requirement. If the Company's stock listing is
transitioned to the Nasdaq SmallCap Market, the Company would
have 180 calendar days from May 14, 2002 to satisfy the minimum
bid requirement for 10 consecutive trading days.  On August 1,
2002, the Company submitted its application to transfer its
common stock to the Nasdaq SmallCap Market.


EMAGIN: Sees Need to Restructure Debt to Execute Business Plan
--------------------------------------------------------------
In a letter to the shareholders of eMagin Corporation (AMEX:
EMA), the leading developer of active matrix organic light
emitting diode microdisplay technology, Chairman, President, and
CEO Gary Jones, remarked on the current status of the company:
"First, we are pleased to inform you that we have a backlog of
over $10 million in purchase agreements, with another almost $10
million in Letters of Intent for orders to be delivered over the
remainder of 2002 and 2003," said Mr. Jones. "We have delivered
OLED-on-silicon microdisplays to military, industrial, medical,
and consumer OEM customers, and currently are continuing to do
so. Some customers have indicated that they are planning new
product lines, or even new start-up companies, around our OLED
microdisplays."

Mr. Jones continued, "However, as we have previously stated,
sufficient capital is required in order to execute our business
plan. As a semiconductor-model company such as eMagin ramps into
production it must still support the fixed costs for a high
technology cleanroom operation and add the increased cost of
building inventory, receivables and other expenses of
production. Certain transactions, which we expected to have
concluded by now, were either delayed or terminated for a
variety of factors, including selling pressure depressing the
stock price, certain capital and debt structural issues that had
been impeding us, and the overall unfavorable equity and debt
market conditions. Lack of operating capital, along with some
materials supply delays, took a toll on our ability to realize
the volume of shipments we had targeted for completion in the
second quarter of 2002, although the volume of orders increased
and our yields further improved. Both our customers and we were
ready, but the financial markets were not. This, along with cash
balance and working capital issues, must be resolved and we are
pursuing a number of possible approaches for resolving this
serious cash crunch."

"It is clear that our payables and debt must be reduced or
restructured in order to allow the company to move forward,"
explained Mr. Jones. "Therefore, we are presently making a
serious effort to restructure our payables. While we can assure
you that we are making every effort to succeed in this
restructuring, we cannot assure you that all of the key
creditors will cooperate fully in this effort or that the
company will be able to continue operations should we not
succeed."

Mr. Jones concluded, "We would like to thank all those who have
continued to encourage us during these exciting yet extremely
difficult times. It has been gratifying to receive so much
support from individual investors, customers, and our employees.
We have a powerful technology, a unique product that can open
several emerging markets as well as provide a key tool for the
military, a strong customer demand, and a capability to
manufacture. We will continue to work hard to persevere, as we
always have, holding our stakeholders' interests foremost."

The letter is posted on the company Web site and was distributed
to subscribing investors via the company's eMail Alert system.

A leading developer of virtual imaging technology, eMagin
combines integrated circuits, OLED microdisplays, and optics to
create a virtual image similar to the real image of a computer
monitor or large screen TV. eMagin provides near-eye
microdisplays which can be incorporated in products such as
viewfinders, digital cameras, video cameras and personal viewers
for cell phones as well as headset-application platforms which
include mobile devices such as notebook and sub-notebook
computers, wearable computers, portable DVD systems, games and
other entertainment. eMagin's corporate headquarters and
microdisplay operations are co-located with IBM on its Hudson
Valley campus in East Fishkill, N.Y. Wearable and mobile
computer headset/viewer system design and full-custom
microdisplay system facilities are located at its wholly owned
subsidiary, Virtual Vision, Inc., in Redmond, WA. URL:
http://www.emagin.com


ENRON CORP: Court Fixes October 15 Bar Date for Proofs of Claim
---------------------------------------------------------------
To flush-out all of Enron's prepetition debts and define the
universe of claims against the Estates, the Debtors sought and
obtained a Court order fixing October 15, 2002 as the Bar Date
for creditors to file proofs of claim against 58 Enron Debtors.
For other Debtors that filed their Schedules after July 31,
2002, the Bar Date for their creditors will be the last business
day of the month that is two months after the date of filing.

The Court further establishes these guidelines:

   (a) the Debtors will mail the Bar Date Notice to all known
       creditors no later than August 16, 2002;

   (b) each person or entity with prepetition claim against any
       of the Debtors will file an original, written proof of
       claim, which substantially conform to Official Form No.
       10, received on or before the applicable Bar Date either
       by:

        (i) mailing their original proof of claim to:

               United States Bankruptcy Court - SDNY
               Enron Claims Docketing Center
               P.O. Box 5104
               Bowling Green Station, New York, NY 10274-5104

       (ii) by messenger or overnight courier to:

               United States Bankruptcy Court - SDNY
               Enron Claims Docketing Center, Mega Case Unit
               One Bowling Green
               New York, New York 10004-1408

   (c) the Enron Claims Docketing Center will not accept Proofs
       of Claim sent by facsimile, telecopy or electronic mail;

   (d) These persons or entities are not required to file a
       proof of claim:

         (i) any person or entity that has already filed with
             the Clerk of the US Bankruptcy Court of the
             Southern District of New York, a proof of claim
             which conforms to the Official Form No. 10;

        (ii) any person or entity whose Claim is listed on any
             of the Schedules and is not described as
             "disputed", "contingent" or "unliquidated" and who
             does not dispute the amount or nature indicated in
             the Schedule;

       (iii) any person or entity having a Claim under Section
             507(a) of the Bankruptcy Code as an administrative
             expense of the Debtors' chapter 11 case;

        (iv) any person or entity whose Claim has already been
             paid;

         (v) any person or entity that holds an interest in any
             Debtor, which interest is based exclusively upon
             the ownership of common or preferred stock,
             membership interests, partnership interests, or
             warrants or rights to purchase, sell or subscribe
             to a security or interest.  However, interest
             holders who wish to assert Claims against any of
             the Debtors that arise out of or relate to the
             ownership or purchase of an interest, including
             Claims arising out of or relating to the sale,
             issuance or distribution of the interest, must file
             proofs of claim on or before the Bar Date, unless
             another exception identified applies;

        (vi) any person or entity that holds a Claim against the
             Debtors that has been allowed by an order of this
             Court entered on or before the Bar Date;

       (vii) any person or entity that holds a Claim solely
             against any of the Debtors' non-debtor affiliates;

      (viii) any Debtor or majority owned non-debtor subsidiary
             of any of the Debtors that holds a Claim against
             another Debtor;

        (ix) any person or entity that holds a Claim solely
             against any Debtor that has not yet filed its
             Schedules;

         (x) any person or entity whose claim is limited
             exclusively to a claim for the repayment by the
             applicable Debtor of principal and interest under
             notes or other debt instruments issued by a Debtor
             pursuant to an indenture or the indenture in
             respect of any Notes; provided, however, that:

             -- the foregoing exclusion in this subparagraph
                will not apply to the indenture trustees under
                each of the Indentures;

             -- each of the Indenture Trustees will be required
                to file a proof of claim on account of the
                applicable Notes and Indentures for which it is
                trustee, on or before the Bar Date; and

             -- each Indenture Trustee and any holder of Notes
                that wishes to assert a claim arising out of or
                relating to the Notes or the Indentures, other
                than a Debt Claim, will be required to file a
                proof of claim on or before the Bar Date, unless
                another exception identified in the paragraph
                applies;

   (e) Claims arising out of rejection of Contracts and Leases
       must file a proof of claim by the later of:

        (i) the Bar Date applicable to the Debtor rejecting the
            Contracts and Leases or

       (ii) 30 days after the effective date of the rejection;

   (f) each Proof of Claim will:

         (i) be written in the English language;

        (ii) be denominated in US currency; and

       (iii) conform substantially with Official Form No. 10;

   (g) the Debtors will publish the Bar Date Notices in The
       Wall Street Journal and The New York Times and locally in
       a newspaper within the geographic scope of the relevant
       Debtor on at least one occasion at least 25 days prior to
       the applicable Bar Date;

   (h) In the event that a Debtor subsequently amends or
       supplements its Schedules, the Debtors will give notice
       of the amendment to the holders of claims affected and
       the holders will have 30 days from the date of notice to
       file their Proofs of Claim; and

   (i) any creditor who failed to file the proof of claim in
       accordance to the Order will be forever barred, estopped
       and enjoined from asserting a claim against the Debtors.

The Court also sets March 31, 2003 as the Bar Date for the
Internal Revenue Service to file a proof of claim or interest
against the Debtors, without prejudice to IRS's right to seek,
upon notice and hearing, an extension of the Bar Date and the
right of the Debtors and the Creditors' Committee to object to
any extension request.

To avoid confusion and facilitate the Claims reconciliation
process, the Debtors ask all creditors to file separate Proofs
of Claim with respect to each alleged claim and against each
Debtor. However, if a creditor has multiple contingent, disputed
or unliquidated Claims against the same Debtor, only one Proof
of Claim form will by mailed to that Creditor.

In addition, pursuant to Bankruptcy Rule 2002(a)(7), the Debtors
will mail the Proof of Claim Form and Bar Date Notice no less
than 45 days prior to Bar Date to:

   (a) the Office of the US Trustee for the Southern District of
       New York;

   (b) each member of the Creditors' Committee and their
       attorneys;

   (c) the attorneys for the Employment-Related Issues
       Committee;

   (d) ENA Examiner, Harrison J. Goldin;

   (e) Enron Corp. Examiner, Neal Batson;

   (f) all known holders of Claims listed on the Schedules of
       those Debtors to which the respective Bar Date applies at
       the addresses stated therein;

   (g) certain potential creditors who have done business with
       the Debtors within two years prior to the first Petition
       Date but not listed in the Schedules as having Claims;

   (h) the Internal Revenue Service;

   (i) the Securities and Exchange Commission; and

   (j) all persons and entities requesting notice pursuant to
       Bankruptcy Rule 2002 as of the business day immediately
       preceding the mailing of the Bar Date Notice. (Enron
       Bankruptcy News, Issue No. 39; Bankruptcy Creditors'
       Service, Inc., 609/392-0900)


ENRON: Sells Oneida's Aircraft Interests to Compass for $10.3MM
---------------------------------------------------------------
According to Martin A. Sosland, Esq., at Weil, Gotshal & Manges
LLP, in New York, Oneida Leasing, Inc., is a non-debtor
affiliate of Enron Corporation engaged in the business of
leasing certain types of assets, including aircrafts.  Oneida
owns all of the beneficial right, title and interest in and to a
McDonnell Douglas DC-9-82 and a Boeing 747-200 as well as the
Operative Documents relating to the Aircrafts, pursuant to:

   (i) that certain Trust Agreement 930 dated August 15, 1988,
       as amended, between Pegasus Capital Corporation --
       Oneida's predecessor-in-interest -- and Wells Fargo Bank
       Northwest, N.A., as Owner Trustee; and

  (ii) that certain Trust Agreement dated July 26, 1991, as
       amended and supplemented, between Potomac Capital
       Investment Corporation and Wells Fargo, as Owner Trustee.

Mr. Sosland relates that the McDonnell Douglas Aircraft is
subject to a lease to Continental Airlines, Inc. that will
expire in October 2006.  The Boeing Aircraft, on the other hand,
was leased to United Air Lines, Inc. until April 2002.

Consistent with their desire to divest themselves of assets
unrelated to its core operation, Enron and Oneida explored the
sale of the Aircrafts.  Prior to Petition Date, Enron retained
AVITAS, Inc., an aviation consulting firm, to provide its
opinion on the Aircraft value.  AVITAS assessed Boeing
Aircraft's current market value at $2,090,000 and the McDonnell
Douglas Aircraft at $3,900,000.  Enron also placed a present
value of the McDonnell Douglas Lease at $7,100,000 and a
$282,600 present residual value.

Thirteen potential bidders were contacted, three of which showed
interest:

   (a) NEA Holdings, Inc. offered $1,600,000 for the Boeing
       Aircraft, subject to the satisfaction of a number of
       contingencies including NEA's successful bid for a
       government contract with India and Oneida restoring the
       Boeing Aircraft to flight condition;

   (b) Aviation Systems International was not interested in
       purchasing either aircraft but would take the Boeing
       Aircraft on consignment; and

   (c) Compass Capital Corporation offered to pay $10,300,000
       for the Aircrafts if the transaction can be closed by
       December 21, 2001.

Enron then entered into a non-binding letter of intent to
transfer Oneida's beneficial interests in the Aircraft to
Compass prior to the Petition Date.

Accordingly, Enron Corp. sought and obtained the Court's
authority to sell Oneida Leasing, Inc.'s aircraft interests to
Compass Capital Corporation under the terms and conditions of
the Aircraft Interest Purchase Agreement dated June 20, 2002.
The Purchase Agreement contains these terms:

Consideration:    $10,300,000 plus interest from November 21,
                  2001 to the Closing Date, less an adjustment
                  for lease payments received by Oneida under
                  the McDonnell Douglas Lease and the United
                  Lease, which is estimated at $3,931,000.

Assets Required:  All the right, title and interest in and to
                  each of the Aircraft and their respective
                  Operative Documents and all of the legal
                  rights, title and interest in and to the Trust
                  Estates, but not including any right, title or
                  interest of each Owner Trustee in and to any
                  of the foregoing.

Representations
and Warranties:   Oneida represents and warrants, inter alia
                  that:

                     (i) the Aircraft and Aircraft Interests are
                         free of Liens;

                    (ii) the Trust Agreements are in full force
                         and effect and no default exists;

                   (iii) the applicable Owner Trustee holds
                         legal title to each of the Aircraft
                         free and clear of all Liens;

                    (iv) Oneida is the sole beneficial owner of
                         each of the Aircraft Interests;

                     (v) no event of default under the
                         applicable Operative Documents has
                         occurred;

                    (vi) to Oneida's knowledge, there have been
                         no offsets to the McDonnell Douglas
                         Lessee's obligation to pay rentals or
                         other amounts due under the McDonnell
                         Douglas Lease and it has no right to
                         offset rentals or other amounts due,
                         paid or payable thereunder;

                   (vii) there is no outstanding indebtedness
                         owed by Oneida in respect of the
                         Aircraft or the Aircraft Interests; and

                  (viii) other customary representations
                         regarding organization, due
                         authorization, execution, etc.

Limitations:      Compass represents and acknowledges that it is
                  relying on its own inspection and knowledge of
                  the Aircraft and, in acquiring the Aircraft
                  Interests, accepts the Aircraft in their "as
                  is, where is" condition.  Except as otherwise
                  expressly set forth in the Purchase Agreement
                  and in the Assignment Agreements, no
                  representations or warranties regarding
                  airworthiness, value, condition, design,
                  operation, merchantability, etc., are being
                  made with respect to the Aircraft or the
                  Aircraft Interests.

Closing
Conditions:       Closing subject to:

                    (i) Compass having delivered all of the
                        items specified in Section 3.1(b) of the
                        Purchase Agreement, and any other
                        documents required under the
                        Participation Agreement, the McDonnell
                        Douglas Purchase Agreement, each of the
                        Trustee Agreements and the McDonnell
                        Douglas Lease from a transferee of an
                        Aircraft Interest;

                   (ii) Oneida having delivered all of the items
                        specified in Section 3.1(a) of the
                        Purchase Agreement and having obtained a
                        final order from this Court approving
                        the sale of the Aircraft and the
                        Aircraft Interests to Compass free and
                        clear of liens, claims, interests and
                        encumbrances; and

                  (iii) other customary conditions.

Indemnification:  Oneida will indemnify and hold Compass
                  harmless from and against any and all claims,
                  losses, liabilities and damages, including,
                  without limitation, amounts paid in
                  settlement, reasonable costs of investigation
                  and reasonable fees and disbursements of
                  counsel, arising out of resulting from the
                  Aircraft Interests prior to Closing, or the
                  inaccuracy of any representation or warranty
                  of Oneida, or the breach by Oneida of any
                  covenant or agreement contained in the
                  Purchase Agreement or in any instrument or
                  certificate delivered pursuant to the Purchase
                  Agreement.

                  Compass will indemnify and hold Oneida
                  harmless from and against any and all claims,
                  losses, liabilities and damages, including,
                  without limitation, amounts paid in
                  settlement, reasonable costs or investigation
                  and reasonable fees and disbursements of
                  counsel, arising out of or resulting from the
                  Aircraft Interests prior to the Closing, or
                  the inaccuracy of any representation or
                  warranty of Compass, or the breach of Compass
                  of any covenant or agreement contained in the
                  Purchase Agreement or in any instrument or
                  certificate delivered pursuant to the Purchase
                  Agreement, except any claims, losses,
                  liabilities and damages asserted by creditors
                  in the Bankruptcy Case after entry of the
                  Approval Order by the Bankruptcy Court, which
                  claims, losses, liabilities and damages arose
                  prior to the Closing.

Mr. Sosland contends that sufficient business justification
exists for the sale under Section 105 and 363(b) of the
Bankruptcy Code because:

   (a) the divesture of the Aircraft Interests was appropriate
       and consistent with its desire to return to its core
       operations;

   (b) the Aircraft Interests are not integral to or
       contemplated to be part of Enron's reorganization;

   (c) the sale enables Oneida to avoid the credit risk
       associated with the McDonnell Douglas Lease and maximize
       the present value of the Aircraft Interests; and

   (d) the Purchase Agreement was negotiated at arm's-length and
       represents fair market value for the Aircraft Interests.

Judge Gonzalez further approves the sale of the Aircraft
Interests free and clear of liens, claims and encumbrances,
which have, or could have, been asserted by creditors or other
parties-in-interest, including the Debtors' estates, in
connection with the Debtors' Chapter 11 cases.  However, any
existing Interests, including the DIP Liens, will be transferred
and attached to the proceeds obtained for the Aircraft
Interests, with the same validity, enforceability, priority,
force and effect that they now have as against the Aircraft
Interests, subject to the rights, claims, defenses and
objections of the Debtors and all interested parties with
respect to these defenses.  Upon consummation of the Purchase
Agreement, Enron will not cause and Oneida will not use nor
distribute the proceeds until the earlier to occur of:

   (a) the consent by the Creditors' Committee to the release of
       the proceeds, or

   (b) further order of the Court.

The Purchase Agreement and any related agreements, documents or
other instruments may be modified, amended or supplemented by
the parties without further order of the Court but with prior
written consent of the Creditors' Committee; provided that the
changes are neither material nor changes the economic substance
of the agreed transaction. (Enron Bankruptcy News, Issue No. 39;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


FEDERAL-MOGUL: Inks Letter of Intent to Sell OE Lighting Assets
---------------------------------------------------------------
Federal-Mogul Corporation (OTC Bulletin Board: FDMLQ) has filed
a letter of intent with the U.S. Bankruptcy Court in Wilmington,
Delaware, to explore the possible sale of its original equipment
(OE) lighting operations to Decoma International Inc. (Nasdaq:
DECA), based in Toronto, Canada.

The two companies will explore the potential sale to Decoma of
Federal-Mogul's OE lighting business with manufacturing
facilities in Hampton, Virginia, and Matamoros, Mexico; a
distribution center in Brownsville, Texas; and an assembly
operation in Toledo, Ohio.  The letter of intent contains a
number of conditions that must be satisfied before a transaction
can be completed.

Federal-Mogul's OE lighting business has approximately 800
employees and produces primarily forward lighting modules.

Federal-Mogul is a global supplier of automotive components and
sub-systems serving the world's original equipment manufacturers
and the aftermarket. The company utilizes its engineering and
materials expertise, proprietary technology, manufacturing
skill, distribution flexibility and marketing power to deliver
products, brands and services of value to its customers.

Federal-Mogul is focused on the globalization of its teams,
products and processes to bring greater opportunities for its
customers and employees, and value to its constituents.
Headquartered in Southfield, Michigan, Federal-Mogul was founded
in Detroit in 1899 and today employs 49,000 people in 24
countries.  For more information on Federal-Mogul, visit the
company's Web site at http://www.federal-mogul.com


FRUIT OF THE LOOM: Settles Claims against William Farley
--------------------------------------------------------
Fruit of the Loom Liquidation Trust and William F. Farley,
Biotechvest L.P., Lia Inc., Biotechvest II, ONX Inc., OPT Inc.,
and Liam Ventures have drafted a Settlement Agreement resolving
their dispute.

                      The Dispute

Risa M. Rosenberg, Esq., at Milbank, Tweed, Hadley & McCloy,
reminds the Court that Fruit of the Loom was party to a guaranty
agreement with Bank of America and Credit Suisse First Boston.
Fruit of the Loom guaranteed a $65,000,000 loan to Mr. Farley.
Postpetition, the lenders asserted that Mr. Farley defaulted on
his obligations under the loan terms.  To date, the outstanding
principal balance of Mr. Farley's loan, excluding interest, fees
and amounts owed under letters of credit, reach $57,132,231.57.

Prepetition, NWI-I, Inc., formerly known as Fruit of the Loom
Inc., maintained a Senior Officer Deferred Compensation Plan and
Trust.  It was established around March 17, 1997 and held trust
assets.  Mr. Farley and the Debtors dispute whether the Rabbi
Trust assets continue to be held in the trust after the Petition
Date.  This Court established procedures and deferred
consideration of the ownership of these assets pending
resolution of an adversary proceeding commenced by Fruit of the
Loom.

On August 11, 2000, Mr. Farley filed proofs of claim asserting
various claims and rights of setoff against multiple Debtors.
The Debtors disputed these proofs of claim.  In connection with
the Settlement, Mr. Farley has agreed to withdraw his proofs of
claim.

On October 27, 2000, the Agent for the Lenders commenced an
action against Mr. Farley in the Supreme Court of New York,
County of New York, styled: Bank of America, N.A. v. Farley, No.
00CIV.9346 (DC). This action was removed to the U.S. District
Court for the Southern District of New York.  The Agent was able
to obtain a judgment against Mr. Farley.

                           The Settlement

Pursuant to the Plan of Reorganization, Bank of America and CSFB
transferred and assigned their Farley-related claims to the
Trust.  The Debtors' claims against Mr. Farley were transferred
and assigned to the Trust.  The Trust is the owner and holder of
these claims and was vested with the responsibility to resolve
the proofs of claim.  The Trust is authorized to settle matters
with Mr. Farley.  The Settlement Agreement provides that:

   (a) Mr. Farley pays $10,000,000 in cash on the settlement
       consummation date;

   (b) Mr. Farley delivers a promissory note to the Trust
       promising to pay $2,000,000 in cash by June 1, 2004;

   (c) Mr. Farley delivers to the Trust a letter of credit
       reimbursement agreement in which Mr. Farley agrees to
       reimburse Bank of America for all draws under
       outstanding letters of credit in the amount of
       $2,200,000 by August 31, 2003;

   (d) Mr. Farley delivers collateral documents mortgaging
       real property, pledging stock and perfecting security
       interests as directed by the Trust;

   (e) Mr. Farley surrenders life insurance policies and
       delivers the cash surrender value to the Trust;

   (f) Mr. Farley delivers artwork to the Trust.

Ms. Rosenberg argues that if the Settlement Agreement is not
approved, the estate will be faced with protracted, expensive
and uncertain litigation.  None of the adversary proceedings has
progressed beyond a preliminary stage and formal discovery is
not yet complete.  In a large measure, it has not even started.
Additionally, Mr. Farley has demonstrated that his ability to
satisfy any judgment obtained against him is limited. (Fruit of
the Loom Bankruptcy News, Issue No. 58; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


GSI GROUP: Engages BKD LLP to Replace Arthur Andersen
-----------------------------------------------------
On August 1, 2002, The GSI Group, Inc., decided to no longer
engage Arthur  Andersen LLP as the Company's independent public
accountants and engaged BKD LLP to serve as the Company's
independent public accountants for the fiscal year 2002.  BKD is
the 8th largest public accounting  firm in the United States,
according to "Public Accounting Report's: Top 100 for 2001"
published by Strafford  Publications, Inc.

Andersen was unable to provide GSI with a letter agreeing to the
Company's termination statements  due to the fact that Andersen
currently employs neither the engagement partner nor the
engagement  manager.

GSI is a leading manufacturer in niche agricultural equipment
markets. Products include grain-handling and storage equipment,
and swine- and poultry-raising equipment. The company posted a
total shareholders' equity deficit of about $16.5 million as of
March 29, 2002.


GENERAL DATACOMM: Closes $7MM Sale of Connecticut Real Estate
-------------------------------------------------------------
General DataComm Industries, Inc., announced that on July 31,
2002, it completed the sale of its former headquarters property
located at 1579 Straits Turnpike, Middlebury, Connecticut, for a
sale  price of $7,175,000.  The net proceeds (after payment of
local real estate taxes and realtor fees) of approximately
$6,800,000 were used to reduce outstanding mortgage
indebtedness. General DataComm  anticipates that for accounting
purposes it will report a gain on the sale of approximately
$3,300,000.

General DataComm Industries, Inc., a worldwide provider of wide
area networking and telecommunications products and services,
filed for Chapter 11 protection on November 2, 2001. James L.
Patton, Esq., Joel A. Walte, Esq., and Michael R. Nestor, Esq.,
represent the Debtors in their restructuring effort. When the
Company filed for protection from its creditors, it listed
$64,000,000 in assets and $94,000,000 in debts.


GLOBAL CROSSING: Providing E-xpedient with 35 Fast-E Ports
----------------------------------------------------------
Global Crossing is providing Metro e-services provider E-
xpedient with 35 Fast Ethernet (Fast-E) ports and Global
Crossing Dedicated Internet Access in Miami, Boston, San
Francisco, Atlanta, Houston, Chicago, New York, Los Angeles, San
Diego, Seattle, Dallas, Washington, D.C., Philadelphia and
Cleveland.  E-xpedient offers enhanced IP services over an
Ethernet infrastructure in major metropolitan centers across the
United States.  The company has recently expanded its service
area from 2 to 15 domestic markets including the cities listed
above and an extended region of Florida from Fort Pierce to Key
West. E-xpedient currently provides flexible, high-speed
Internet transit packages to businesses in over 750 buildings.

"We've expanded our offerings and market presence through
aggressive sales and acquisitions, and now have the ability to
support businesses in over 4,500 buildings in the U.S. while
achieving 500% revenue growth to date in 2002," said Mark
McGinness, chief executive officer of E-xpedient.  "It's
critical for us to select the right provider as we continue to
expand across the country and to sign new customers.  Global
Crossing is the logical choice: they offer us an unbeatable
combination of reliable, high-speed service, excellent customer
service and geographic fit."

"As a provider of data communications services to the world's
top 200 cities, we can support E-xpedient as it continues to
broaden its customer base and expand to new cities throughout
the U.S.," said John Legere, chief executive officer of Global
Crossing.  "We're pleased to be working with E-xpedient and look
forward to seeing the relationship grow."

Global Crossing's Dedicated Internet Access provides customers
with always on, direct high-speed connectivity to the Internet
at speeds ranging from sub-T1/E1 to OC48/STM16 and 10Base --
GigE on a global basis.

Fast-E users enjoy the benefits of transmission at speeds of up
to 100 megabits per second through the Ethernet protocol.
Ethernet is the standard used for local area networks.

Global Crossing provides telecommunications solutions over the
world's first integrated global IP-based network, which reaches
27 countries and more than 200 major cities around the globe.
Global Crossing serves many of the world's largest corporations,
providing a full range of managed data and voice products and
services.  Global Crossing operates throughout the Americas and
Europe, and provides services in Asia through its subsidiary,
Asia Global Crossing.

On January 28, 2002, certain companies in the Global Crossing
Group (excluding Asia Global Crossing and its subsidiaries)
commenced Chapter 11 cases in the United States Bankruptcy Court
for the Southern District of New York and coordinated
proceedings in the Supreme Court of Bermuda.  On the same date,
the Bermuda Court granted an order appointing joint provisional
liquidators with the power to oversee the continuation and
reorganization of the Bermuda-incorporated companies' businesses
under the control of their boards of directors and under the
supervision of the U.S. Bankruptcy Court and the Supreme Court
of Bermuda.  On April 23, 2002, Global Crossing commenced a
Chapter 11 case in the United States Bankruptcy Court for the
Southern District of New York for its affiliate, GT UK, Ltd.
Global Crossing does not expect that any plan of reorganization,
if and when approved by the Bankruptcy Court, would include a
capital structure in which existing common or preferred equity
would retain any value.

Please visit http://www.globalcrossing.comor
http://www.asiaglobalcrossing.comfor more information about
Global Crossing and Asia Global Crossing.

Headquartered in Cleveland, Ohio, E-xpedient is a national
Internet service provider delivering enhanced IP services over
an Ethernet infrastructure.  E-xpedient offers flexible and
affordable high-speed Internet transit and long distance
services to businesses in metropolitan areas throughout the
United States, including: San Francisco, San Diego, Seattle,
Chicago, New York, Philadelphia, Denver, Dallas, Houston,
Washington D.C., Boston, Pittsburgh, Cleveland, Miami, and the
Southern region of Florida from Fort Pierce to Key West.  The
expansive E-xpedient network allows faster connectivity and
higher reliability at very reasonable prices.

For more information about E-xpedient, visit
http://www.e-xpedient.com

DebtTraders reports that Global Crossing Holdings Ltd.'s 7.250%
bonds due 2004 (GBLX04USR1) are trading between 8 and 12. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=GBLX04USR1
for more real-time bond pricing.


HAYES LEMMERZ: Gets Approval to Retain PRI as Internal Auditor
--------------------------------------------------------------
Hayes Lemmerz International, Inc., and its debtor-affiliates,
sought and obtained the Court's authority to employ and retain
Professional Resources International Inc., as Internal Auditor.

Hayes-Lemmerz Chief Restructuring Officer Kenneth A. Hiltz
relates that PRI has been assisting the Debtors in performing
internal audit functions, and reporting to management and the
Audit Committee regarding its findings since July 1993.  With
the Court's approval, PRI will now be able to continue and
complete its internal audit for fiscal year 2002.  Mr. Hiltz
points out that PRI is well-qualified to act as an Internal
Auditor for the Debtors in light of its prior experience working
with the Debtors and its expertise in assisting companies in
outsourcing their internal audit functions.

Mr. Hiltz relates that PRI was included in the Ordinary Course
Professional list submitted with the Court.  However, the scope
of work by PRI has since been expanded and PRI has exceeded the
allowed monthly cap pursuant to the OCP Order.  For the period
from the Petition Date through June 15, 2002, PRI's fees and
expenses are $140,064, $74,438 of which is still unpaid because
it exceeds the allowed monthly limits provided for in the OCP
Order.

Accordingly, the Court authorized the Debtors to pay PRI for the
excess amount of services and compensation incurred over and
above the monthly payment caps under the Ordinary Course
Professionals Order.

As Internal Auditor, PRI will continue to:

A. review the inventory control procedures at certain locations
   and assist the Debtors in auditing the inventory and scrap
   balances to ensure their accuracy and completeness;

B. review the procedures for safeguarding cash at certain
   locations, including reviewing the segregation of duties and
   requirements for cash disbursement, and performing bank
   reconciliation;

C. perform a detailed financial account review at certain plant
   locations to ensure control procedures are followed and that
   procedures are in place for generating accurate and complete
   financial statements;

D. assist in the completion of information system audits by
   reviewing the general controls, functional areas, and
   application security to ensure only authorized individuals
   have access to certain information and data is adequately
   maintained and safeguarded;

E. assist in the review of the Standard of Business Conduct and
   Declaration of Interest Questionnaires distributed by Hayes;

F. prepare reports summarizing findings to management and assist
   management in developing and implementing procedures to cure
   deficiencies in the current control environment; and

G. prepare periodic reports to the Board of Directors and the
   Audit Committee of a summarization of findings and
   management's related responses.

Mr. Hiltz asserts that these professional services are necessary
in the ongoing operation and management of the Debtors'
businesses and assets, as well as beneficial to the Debtors'
restructuring efforts under Chapter 11 of the Bankruptcy Code.
Mr. Hiltz assures the Court that PRI's services will not
duplicate KPMG's services.

PRI President Robert H. Rohweder reports that the firm's
officers and employees do not have any connection with the
Debtors, their creditors, or any other party in interest, or
their respective attorneys or accountants.  PRI is a
"disinterested person" under Section 101(14) of the Bankruptcy
Code.  Mr. Rohweder adds that PRI does not hold or represent an
interest adverse to the Debtor's estates.  However, PRI
currently performs or has performed work for these entities:

A. Trade Creditors: Lake Erie Steel Co. Ltd., and Stelco USA
   Inc.

B. Contract Parties: Sanwa Fleet Capital

C. Other Parties: Daimler Chrysler North America LLC and
   CitiCapital Commercial Corp.

In return for its services, PRI will charge the Debtors its
customary hourly rates and will seek reimbursement for
reasonable and necessary out-of-pocket expenses.

           PRI's current hourly rates are:

      Directors                $145
      Managers                 $135 - $145
      Associates                $65 - $110

Mr. Rohweder tells the Court that PRI has waived its $156,634
prepetition claim, in connection with its retention as internal
auditor.  Within the year prior to the Petition Date, PRI's
total fees and expenses for internal audit services rendered on
behalf of the Debtors was $706,740.  PRI estimates that its fees
and expenses for the completion of its fiscal year 2002 internal
audit will not exceed $1,181,000. (Hayes Lemmerz Bankruptcy
News, Issue No. 15; Bankruptcy Creditors' Service, Inc.,
609/392-0900)


ICG COMMS: Supplemental Disclosure Statement Hearing on Aug. 23
---------------------------------------------------------------
ICG Communications, Inc., and its debtor-affiliates, announce
that a hearing will be held before Judge Walsh to consider the
adequacy of the information in the Second Supplement to the Plan
as modified, and if the Court finds the content adequate to
permit solicitation, to schedule a confirmation of the Plan as
modified.  This hearing is scheduled for August 23, 2002,
commencing at 11:30 a.m.  (ICG Communications Bankruptcy News,
Issue No. 28; Bankruptcy Creditors' Service, Inc., 609/392-0900)


ION NETWORKS: Deloitte & Touche Raises Going Concern Doubt
----------------------------------------------------------
ION Networks, Inc., designs, develops, manufactures and sells
infrastructure security and management products to corporations,
service providers and government agencies. The Company's
hardware and software products are designed to form a secure
auditable portal to protect IT and network infrastructure from
internal and external security threats. ION's infrastructure
security solution operates in the IP, data center,
telecommunications and transport, and telephony environments and
is sold by a direct sales force and indirect channel partners
mainly throughout North America and Europe.

Revenues for the year ended March 31, 2002 were $7,312,235 as
compared with revenues of $11,676,547 for the year ended March
31, 2001, a decrease of approximately 37%. This decrease is
attributable mainly to the reduction in the number of units sold
in fiscal 2002. The Company sold mostly the ION Secure 3000
series security appliances (formerly called the Sentinel 2000)
in both periods so there was no impact on revenue from a change
in product mix. The overall downturn impacting the information
technology and the telecommunications industry caused companies
to severely cut capital expenditures during fiscal 2002. The
Company's business historically has been dependent upon the
expansion of these company's networks and therefore the decrease
in revenues is a direct reflection of the environment in the
industries. The Company's unit sales volumes decreased by
approximately 1,100 units which contributed to approximately
$2.5 million of the revenue decrease year over year. The
Company's prices remained relatively consistent throughout most
of fiscal 2002 as compared to fiscal 2001.

The Company's cost of goods sold decreased to $3,484,132 for the
year ended March 31, 2002 compared to $7,184,666 for the year
ended March 31, 2001. Cost of goods sold as a percentage of
sales decreased from 61.5% for the previous comparable fiscal
period to 47.6% for this fiscal period. The decrease is due to
the impact of additional provisions of approximately $1,549,099
that were established at various points during fiscal 2001, to
recognize slow moving inventory. Without these reserves, cost of
goods sold would have been 48.3% of sales in fiscal 2001.

As a result of the Company's operating performance during the
first six months of FY2002, the Company, during the third
quarter of FY2002, announced the layoff of 17 employees to
reduce its overhead expenses. As a result, the Company reduced
its overhead expenses by approximately $1,600,000 in annual
salaries and employee benefits (approximately $135,000 per
month). The Company recorded approximately $217,467 of severance
and termination related costs. Termination benefits of
approximately $214,000 were paid during the third and fourth
quarters of FY2002. All of the affected employees have left the
Company as of March 31, 2002. As of April 30, 2002 the remaining
termination benefits of $3,467 were paid.

The Company had a loss before taxes of $6,905,015 for the year
ended March 31, 2002 compared to a loss before taxes of
$16,669,098 for the year ended March 31, 2001. The loss before
taxes improved primarily as a result of the Company's cost
reduction efforts and management's decision during year ended
March 31, 2001 to abandon certain products and technology
associated with the SolCom acquisition. At March 31, 2002 and
March 31, 2001 the Company had federal and state net operating
loss carryforwards of approximately $35.5 million and $27.4
million respectively. The expiration dates for its net operating
losses range from the years 2011 through 2022. The net loss for
the year ended March 31, 2002 was $6,929,379 compared to a net
loss of $16,676,666 for the prior fiscal year.

The Company's working capital balance as of March 31, 2002 was
$5,040,922 as compared to $6,918,057 at March 31, 2001. This
decline in working capital was due to continued operating losses
generated throughout fiscal 2002, which was partially offset by
$3,480,000 raised through the issuance of new shares in a
private placement of 4,000,000 shares of common stock at a price
of $0.87 per share. The Company's management believes that
working capital as of March 31, 2002 will fund the Company's
operations, as currently planned, until January 2003. However,
management also believes that a minimum of $2,000,000 in
additional capital will be needed in order to fund the Company's
planned operations through June 2003. The Company plans to seek
equity financing to provide funding for operations but the
current market for equity financing is very weak. If not
successful in raising additional equity capital to generate
sufficient cash flows to meet obligations as they come due, ION
plans to continue to reduce overhead expenses by the reduction
of headcount and other available measures. It may also explore
the possibility of mergers and acquisitions. If not successful
in increasing revenue, reducing expenses or raising additional
equity capital to generate sufficient cash flows to meet
obligations as they come due, the Company has indicated that it
may not be able to continue as a going concern.

Deloitte & Touche LLP's Auditors Report on ION Networks Inc. and
its Subsidiaries' consolidated balance sheet as of March 31,
2002 says: "[T]he Company's recurring losses from operations and
its difficulty in generating sufficient cash flow to meet its
obligations and sustain its operations raise substantial doubt
about its ability to continue as a going concern."


IT GROUP: Wants to Implement Employee Retention & Severance Plan
----------------------------------------------------------------
The IT Group, Inc.'s  and its debtor-affiliates' ability to
continue with their remaining business operations and preserve
the value of their estates is dependent on the continued
employment and dedication of certain Key Employees who possess
the knowledge, experience and skills necessary to support the
remaining business operations and wind-down the Debtors'
estates, according to Marion M. Quirk, Esq., at Skadden, Arps,
Slate, Meagher & Flom LLP, in Wilmington, Delaware.

With the present situation of the company, Mr. Quirk believes
that a Retention and Severance Program will aptly provide these
Key Employees with a greater sense of financial security, which
would otherwise distract them from the necessary tasks they need
to perform for the Debtors.  In addition, finding top-caliber
replacement employees at this time may not be easy, considering
the fact that the Debtors are about to fold up.

The Debtors ask the Court to approve the implementation of the
Key Employee Retention and Severance Program.

Mr. Quirk tells the Court that the Retention and Severance
Program is not new to the Debtors.  Historically, the Debtors
provided senior executives with severance payment in an amount
between one and two years of that senior executive's salary,
plus executive outplacement and the continuation of benefits
upon termination.  In addition, the Debtors have provided junior
executives with a severance payment along with outplacement
services.  Non-executive employees were also entitled to
severance payment upon termination.

Mr. Quirk states that the Severance and Retention Program is
designed:

* to ensure basic financial security by providing a severance
   benefit for Key Employees; and

* for the purpose of retaining the Key Employees during the
   pendency of these Chapter 11 cases.

The salient terms under Severance and Retention Program include:

A. Eligibility:  An employee covered under the Plan will be
   eligible for Severance and Retention Payment if he or she
   remains actively employed through and including the earlier
   of:

    * the employee's separation date; or
    * the effective date of a plan of reorganization.

   The Program divides key employees into three tiers:

           Tier    Key Employee      Position
           ----    ------------      --------
            1      Harry Soose       CEO, BOD member

            2      Richard Conte     current officers of
                   Frank Rice           the IT Group

            3      Brian Fournier    involved in the Northern
                   Miguel Martinez      California Sites
                   Richard Swanson

B. Payments:  Estimated payment amounts --

                  Tier 1      $200,000
                  Tier 2        20,000
                  Tier 3       100,000
                             ----------
                  TOTAL       $320,000

   The Severance and Retention Payment to each Key Employee
   amounts to no more than the annual salary of that Key
   Employee.  The Debtors also propose to give Tier 2 Key
   Employees with Severance and Retention Payment in the form of
   professional outplacement services, instead of cash payment.

C. Termination: Any Key Employee who:

   a. voluntarily leaves the Debtors' employment, or
   b. is terminated for cause,

   will forfeit his or her right to future payment under the
   program.

   Any amounts intended for that employee but are not paid due
   to his or her voluntary resignation or termination for cause,
   will be returned to the Debtors' estates.  That amount will
   be made available for distribution to the Debtors' secured
   and unsecured creditors.

D. Waiver of Certain Claims:  By accepting the Program, each Key
   Employee will be deemed to have waived all his or her claims
   against the Debtors under any prepetition employment
   agreements or policy existing between the Debtors and that
   Key Employee; provided, however, each Key Employee retains
   the right to assert claims, if any, against the Debtors for
   indemnification and contribution under the Debtors' by-laws,
   insurance or under applicable law.

   Key employees will no longer be eligible for:

   a. any payments under any other severance or retention
      programs offered by the Debtors -- except that the Key
      Employees are entitled to payment of accrued, unpaid
      vacation pay to the extent not already paid;

   b. outplacement services -- with the exception of two Key
      Employees whose Severance and Retention Payments will go
      directly towards outplacement services, as opposed to a
      cash payment; and

   c. the continuation of any employee benefits post-
      termination.

According to Mr. Quirk, the Severance and Retention Program is
the Debtors' end of the bargain in consideration of the
significant roles the Key Employees will be playing during the
pendency of these cases.  Mr. Soose has the knowledge and
expertise necessary to lead the wind-down of the Debtors'
estates and maximize the value of the estates.  His
responsibilities include:

A. maintaining operations within the constraints of the budget;

B. assisting with the preparation of a reorganization plan and
   disclosure statement;

C. managing the Debtors' operations at the Northern California
   Sites;

D. working to shutdown or sell the various international
   entities not purchased by Shaw;

E. monitoring and recording cash receipts and disbursements
   against the budget and obtaining necessary approvals for
   disbursements; and

E. identifying and collecting funds recoverable on contracts and
   projects that Shaw designated as excluded or completed
   projects.

Mr. Quirk states that Tier 2 employees are going to support Mr.
Soose in achieving his goals.  Tier 3 members are also necessary
in order to assist the Debtors with their business operations at
the Northern California sites, which consists of four landfills.
These employees are experts and knowledgeable in environmental
monitoring required by law and under applicable insurance
policies covering the Debtors' operations at these sites.
(IT Group Bankruptcy News, Issue No. 15; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


INACOM: Deloitte & Touche Gets Go-Signal to Withdraw Services
-------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware gave its
stamp of approval to Deloitte Consulting LP and Deloitte &
Touche LLP to withdraw as reorganization consultants of Inacom
Corp., and its debtor-affiliates.

Deloitte & Touche was retained by the Debtors and approved by
the Court to act as reorganization consultants to provide
necessary reorganization consulting services, in furtherance of
the Debtors' chapter 11 cases.

The Debtors have retained Hahn Loeser & Parks LLP to commence
avoidance actions under Chapter 5 of the Bankruptcy Code.
Deloitte & Touche was one of the professionals who received a
letter from Han Loeser stating that Deloitte & Touche had
received payments that may be avoidable by the Debtors under the
Bankruptcy Code.  Delloite & Touche believes that it is
appropriate for them to withdraw as reorganization consultants
to the Debtors and for them to cease providing any further
services to the Debtors in these chapter 11 cases.

Inacom Corp., providers of information technology products and
technology management services, filed for Chapter 11 petition on
June 16, 2000. Laura Davis Jones and Christopher James Lhulier
at Pachulski Stang Ziehl Young & Jones PC represent the Debtors
in their restructuring efforts.


INTEGRATED HEALTH: Will Pay GE $1.6MM to Keep Leased Equipment
--------------------------------------------------------------
General Electric Capital Commercial Equipment Financing and
Integrated Health Services, Inc., entered into three Master
Equipment Leases each in the years 1990, 1996 and 1997.  GECC
assigned certain Schedules under the 1997 Equipment Lease to
LaSalle and some other Schedules under the 1997 Equipment Lease
to Diamond Lease (U.S.A.) Inc.  GECC has continued to act as
fiscal agent for LaSalle and Diamond.

The Debtors are currently using the Equipment for data
processing and other purposes.

The Lessors allege that IHS owe them rent under the Equipment
Leases:

   -- $1,933,722.00 for post-petition periods, and

   -- $86,455.62 for unpaid and delinquent prepetition rental
      payments, plus costs to buyout the leases.

The Lessors have filed proofs of claim with respect to the
Prepetition Obligations.

To settle all issues arising out of the Equipment Leases, the
Lessors and the Debtors agree that:

   (a) the Debtors will pay to the Lessors $1,635,000.00;

   (b) in exchange, the Lessors will release and assign to the
       Debtors the rights, title and interest in the equipment,
       including execution of bills of sale and UCC-3
       termination statements;

   (c) they will not litigate the issue of whether the Equipment
       Leases are true leases or are, alternatively, financial
       arrangements.

While the Equipment may have little resale value, it continues
to have significant use and value to the Debtors.  Therefore,
the Debtors contend that the proposed settlement must be
approved. (Integrated Health Bankruptcy News, Issue No. 40;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


INTERLIANT: Gets Court Approval to Hire Kronish Lieb as Counsel
---------------------------------------------------------------
Interliant, Inc., and its debtor-affiliates sought and obtained
approval from the U.S. Bankruptcy Court for the Southern
District of New York to employ Kronish Lieb Weiner & Hellman LLP
as their counsel.

The Court determined that the employment of Kronish Lieb under a
general retainer is necessary to enable the Debtors to execute
faithfully their duties as Debtors in Possession and to develop,
propose, and consummate a Chapter 11 plan or plans. Kronish Lieb
will be employed to:

     a) take all necessary action to protect and preserve the
        estates of the Debtors, including the prosecution of
        actions on the Debtors' behalf, the defense of any
        actions commenced against the Debtors, the negotiation
        of disputes in which the Debtors are involved, and the
        preparation of objections to claims filed against the
        estates;

     b) prepare on behalf of the Debtors, as Debtors in
        Possession, all necessary motions, applications,
        answers, orders, reports, and papers in connection with
        the administration of the estates;

     c) prosecute, on behalf of the Debtors, a proposed plan or
        plans of reorganization and all related transactions and
        any revisions, amendments, etc.; and

     d) perform all other necessary legal services in these
        cases.

Kronish Lieb will charge the Debtors at its current hourly
rates:

     James A. Beldner (partner)                $495 per hour
     Cathy Hershcopf (partner)                 $425 per hour
     Richard S. Kanowitz (senior associate)    $360 per hour
     Christopher A. Jarvinen (associate)       $235 per hour
     Ryan M. Papir (associate)                 $205 per hour
     Joanna Bergmann (associate)               $205 per hour
     Rebecca Goldstein (paralegal)             $170 per hour

Interliant, Inc., is a provider of Web site and application
hosting, consulting services, and programming and hardware
design to support the information technologies infrastructure of
its customers. The Company filed for chapter 11 protection on
August 5, 2002. Cathy Hershcopf, Esq., and James A. Beldner,
Esq., at Kronish Lieb Weiner & Hellman, LLP represent the
Debtors in their restructuring efforts. When the Company filed
for protection from its creditors, it listed $69,785,979 in
assets and $151,121,417 in debts.


J.P. MORGAN: S&P Cuts Ratings on Class G & H Certificates
---------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on
classes G and H of J.P. Morgan Commercial Mortgage Finance
Corp.'s mortgage pass-through certificates series 1997-C5.
Concurrently, ratings are raised on classes B and C of the same
series. At the same time, ratings are affirmed on classes A-2,
A-3, D, E, and F of the same series.

The rating actions reflect the increased subordination levels,
due to amortization and loan prepayments, and stable operating
performance of the collateral. These factors are offset by
potential losses to the trust resulting from the delinquent
loans. Currently, there are 10 delinquent loans and two REO
loans ($36.5 million and 4.7%). The weighted average debt
service coverage (DSC) increased to 1.57 times (based on 91% of
the loan pool reporting year end 2001 information) from 1.44x at
issuance. As of July 2002, the pool balance totaled $768.58
million with 214 loans, down from $1.03 billion at issuance. To
date, cumulative realized losses total $3.2 million on three
loans, and appraisal reductions total $4.6 million on three
loans.

The REO loans total $12.9 million (1.7% of the loan pool
balance) are a $7.2 million loan that has been REO since
November 2001 and a $5.8 million loan that has been REO since
March 2002, resulting from a deed-in-lieu. The $7.2 million loan
is secured by a health care facility located in Mesa, Ariz. The
special servicer of the loan, Lend Lease Asset Management L.P.
(Lend Lease), applied an appraisal reduction of $3.5 million to
this loan in April 2002. The $5.8 million loan is secured by a
retail center located in Bullhead City, Ariz. The anchor tenant
at the retail is Albertson's Inc. (triple-'B'-plus), which
announced store closings in March 2002, did not include the
Bullhead City location among those scheduled to close. The
property is listed for sale at $5.3 million, and Lend Lease
anticipates a loss of about $1.0 million.

The three loans totaling $10.9 million that are 90-plus days
delinquent are a $4.3 million loan, secured by a multifamily
development in Dallas, Texas, appraised at $5.9 million in May
2002; a $4.3 million loan secured by industrial property located
in Indianapolis, Ind., which received an appraisal reduction of
$463,000 in April 2002; and a $2.4 million loan (0.31%), secured
by a Knights Inn Hotel located in Kissimmee, Florida, which
received an appraisal reduction of $620,000 in April 2002. Lend
Lease has initiated foreclosure on the $5.9 million and $4.3
million loans, and is discussing workout options with the
borrower regarding the $2.4 million loan.

There are seven loans that are 30 days delinquent, totaling
$12.7 million (1.6%). Five of the seven loans are being
specially serviced. The two largest loans of the seven
delinquent loans have unpaid balances totaling $5.0 million, or
0.66%. Both loans are secured by Days Inn hotels-one is located
in Orlando, Fla., and the other is located in Lewisville, Texas.
The borrower on the Orlando, Fla. hotel has a history of
delinquent payments.

Lastly, there are two additional loans being specially serviced
that are current with debt service payments. Of these two loans,
the $3.9 million loan secured by a single tenant retail property
located in Redding, Calif. Is of greatest concern to Standard &
Poor's. The property has been vacant since June 2002, due to the
bankruptcy filing of Home Base, the previous tenant, which
subsequently closed the store. The borrower continues to make
debt service payments and is attempting to lease or sell the
property. Lend Lease advised Standard & Poor's that the property
is not in a good retail location and that the borrower is
experiencing difficulty with securing a tenant or a prospective
buyer.

The master servicer, Midland Loan Services Inc. (Midland),
placed eight loans ($20.5 million, or 2.6%) on its watchlist.
Standard & Poor's is most concerned about two loans ($6.3
million, or 0.82%) that reported DSC ratios that are less than
1.0x. One loan, totaling $3.3 million, is secured by a nursing
facility located in Guttenberg, N.J. The other is a $2.9 million
loan secured by a Holiday Inn Hotel located in Alpharetta, Ga.
Based on discussions with the master and special servicers,
Standard & Poor's believes that the trust will likely incur
losses associated with many of the loans discussed above.
Consequently, selective specially serviced, delinquent, and
watchlist loans were stressed in Standard & Poor's loss
analysis. It was then determined that the resulting credit
levels warrant the rating changes.

The loan pool is diverse with respect to geographic location and
property type. Retail, multifamily, and office are the most
common property types, representing 33%, 23%, and 12% of the
outstanding pool balance, respectively. California (18%) is the
only state that exceeds a 10% concentration. The top 10 loans
represent 19% of the mortgage pool. Midland reported that the
property securing the ninth largest loan is in excellent
condition and the remaining properties securing the other top 10
loans are in good condition.

                       RATINGS LOWERED

          J.P. Morgan Commercial Mortgage Finance Corp.
        Mortgage pass-through certificates series 1997-C5

                           Rating
         Class      To        From     Credit Support%
         G          B-        B        2.98%
         H          CCC+      B-       2.31%

                      RATINGS RAISED

         J.P. Morgan Commercial Mortgage Finance Corp.
        Mortgage pass-through certificates series 1997-C5

                          Rating
       Class      To        From     Credit Support%
       B          AAA       AA+      31.07%
       C          AA        A+       23.72

                    RATINGS AFFIRMED

       J.P. Morgan Commercial Mortgage Finance Corp.
      Mortgage pass-through certificates series 1997-C5

          Class       Rating      Credit Support%
          A-2         AAA         37.76%
          A-3         AAA         37.76%
          D           BBB+        16.36%
          E           BBB-        14.35%
          F           BB          7.66%


JANUS HOTELS: Fails to Maintain Nasdaq Listing Requirements
-----------------------------------------------------------
Janus Hotels and Resorts, Inc. (Nasdaq:JAGI), a Florida-based
hospitality company, has been notified by The Nasdaq Stock
Market, Inc., that the Company's common stock has closed for
more than 30 consecutive trading days below the minimum $1.00
per share requirement for continued inclusion on the Nasdaq
SmallCap Market.

In accordance with Nasdaq rules, the Company has been afforded
until January 27, 2003 to regain compliance with the minimum bid
price requirements. If the Company cannot demonstrate compliance
by that date, the Company's common stock is subject to being
delisted from the Nasdaq SmallCap Market.

Louis S. Beck, the Chairman and Chief Executive Officer of the
Company stated, "Management will consider all available options
in order to regain full compliance with the Nasdaq listing
requirements."

Janus Hotels and Resorts Inc., is engaged in the business of
management and ownership of hospitality properties. The Company
currently owns thirteen hotels and manages thirty-eight hotels
totaling approximately 9,000 rooms under its management.


KMART: Equity Committee Brings-In Goldberg Kohn as Local Counsel
----------------------------------------------------------------
The Equity Committee in the Chapter 11 cases of Kmart
Corporation, and its debtor-affiliates, sought and obtained
approval from the U.S. Bankruptcy Court of the Northern District
of Illinois to retain Goldberg, Kohn, Bell, Black, Rosenbloom &
Moritz, Ltd., as local counsel nunc pro tunc to June 14, 2002,
and work with Traub Bonacquist & Fox LLP.

Goldberg Kohn will:

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

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

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

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

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

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

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

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

Goldberg Kohn will coordinate with Traub Bonacquist to ensure no
duplication of efforts by the two firms.

The firm's current hourly rates are:

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

(Kmart Bankruptcy News, Issue No. 29; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


KMART CORP: Enters Into Settlement Deal with IBM Credit
-------------------------------------------------------
On July 17, 2002, IBM Credit and Kmart Corporation entered into
a letter agreement settling the issues arising under the IBM
Credit Motion.  Subject to Court approval, the parties stipulate
and agree that:

A. Kmart will buy the EOL Equipment for $150,000, an amount
   already received by IBM Credit.  In additional, IBM Credit
   will be granted an allowed unsecured claim for all unpaid
   rental amounts under the EOL Lease.  Except for that allowed
   unsecured claim, IBM Credit releases Kmart from all liability
   with respect to the EOL Equipment;

B. Kmart will assume the 2000 POS Lease on these terms:

   a. Payments from the Petition Date to the end of lease will
      be reduced by 9.5% from the non-default contract rate, and
      IBM Credit will be granted an allowed unsecured claim
      representing the amount by which the 2000 POS Lease
      payments are reduced;

   b. IBM Credit will permit Kmart to terminate up to 25% of the
      2000 POS Equipment during the period from January 1, 2003
      to June 30, 2003, without cost or penalty except as
      provided in the Master Lease, which requires, among other
      things, that Kmart pay all costs associated with return,
      inspection, and qualification of the equipment.  However,
      those terminations will only be of 2000 POS Equipment
      which is located in closing stores, and only after Kmart
      has redeployed 2000 POS Equipment from closing stores to
      any Kmart stores which remain open at the time, and for
      which all point of sale equipment is not IBM SurePOS
      equipment; and

   c. IBM Credit agrees that The Coolidge Group LLC fka TC Group
      I LLC is the contracting party with respect to the 2000
      POS Lease and will invoice Coolidge Group with respect to
      the lease retroactive to September 29, 2000.  The parties
      will execute whatever documents are reasonably requested
      by the parties to confirm this, including, but not limited
      to, an agreement by Kmart to guaranty, as surety and
      guarantor, all obligations of Coolidge Group to IBM
      Credit;

C. Kmart will assume the Data Center Lease, except that Kmart is
   not assuming Supplement Numbers E00036061-2 and E00042765-2,
   which Kmart already identified as being rejected.  There is
   no cure payment with respect to the Data Center Lease;

D. Kmart will pay all post-petition rents as they come due on
   the 2001 POS Lease from the Petition Date and thereafter;

E. The postpetition cure payment for the assumed 2000 POS Lease
   and Data Center Lease will be made within five business days
   after approval of this Stipulation.  IBM Credit agrees to
   limit the prepetition cure payment for Assumed Leases to
   $1,000,000, which Kmart will pay within 60 days after Kmart's
   reorganization plan is confirmed, or in the event that
   Kmart's bankruptcy case is converted to a Chapter 7
   proceeding, IBM Credit will receive an allowed Chapter 11
   administrative claim, pursuant to Bankruptcy Code Sections
   503(b)(1)(A) and 507(a)(1), for $1,000,000;

F. IBM Credit will be granted a $1,150,073 allowed unsecured
   claim in full satisfaction of unpaid prepetition amounts
   that are not included in the cure payment for the Assumed
   Leases;

G. Kmart agrees that, upon receiving instructions and labels
   from IBM Credit, it will label the logic units of all leased
   IBM Credit SurePOS equipment; and

H. IBM Corporation has agreed to offer certain price reductions
   on the future purchase or lease of certain equipment upon
   certain conditions provided in the Term Sheet, which terms
   are confidential and proprietary information.  The Committees
   have been informed of the terms related to the price
   reductions. (Kmart Bankruptcy News, Issue No. 29; Bankruptcy
   Creditors' Service, Inc., 609/392-0900)


LEXAM EXPLORATIONS: Evaluating Possible Reorganization Options
--------------------------------------------------------------
Lexam Explorations Inc., (TSX VENTURE:LEX) recorded a loss of
$52,005 in the three months ended June 30, 2002, compared to a
loss of $70,623 during the corresponding period in 2001. During
the six months ended June 30, 2002, Lexam recorded a loss of
$72,776, down from $130,611 during the first half of 2001. The
reduced loss was the result of lower administration, exploration
and interest expense in 2002. The interest expense during 2001
related to a demand loan outstanding to Goldcorp Inc. During the
second quarter of 2001, the demand loan, along with accrued
interest, was settled in exchange for Lexam shares. The loss for
the six months ended June 30, 2002, was also partially offset by
a gain on sale of marketable securities of $11,427. During the
half, 155,000 shares of Hope Bay Gold Corporation Inc., were
sold for proceeds of $39,327.

In May of 2002, Hope Bay Gold amalgamated with Miramar Mining
Corporation. Shareholders of Hope Bay Gold received 0.263 of a
Miramar share for each Hope Bay Gold share. At June 30, 2002,
Lexam's 174,895 Miramar shares had a market value of $286,828.

During the second quarter of 2002, costs of $10,025 were
incurred on the Baca Property, the Company's oil & gas property
in Colorado. Expenditures during the six months ended June 30,
2002 were $35,362. The costs involved analysing seismic data
that was obtained in 2001 and keeping the property rights in
good standing.

                       Financial Condition

Lexam is currently not able to continue its exploration efforts
and discharge its liabilities in the normal course of business,
and may not be able to ultimately realize the carrying value of
its assets, subject to, among other things, being able to raise
sufficient additional financing to fund its exploration
programs. The Company is pursing several alternatives to address
these issues, including joint venturing certain properties,
seeking additional sources of debt or equity financing and
investigating possible reorganization alternatives.

As at June 30, 2002, Lexam's balance sheet shows that its total
current liabilities exceeded its total current assets by about
C$1.1 billion.

             Notes to Consolidated Financial Statements

1. Basis of Presentation and Going Concern

The consolidated financial statements are prepared in accordance
with generally accepted accounting principles and on the
assumption that Lexam Explorations Inc., will be able to realize
the carrying value of its assets and discharge its liabilities
in the normal course of business.

The Company has a significant working capital deficiency and is
not currently able to continue its exploration programs and
discharge its liabilities in the normal course of business, and
may not be able to ultimately realize the carrying value of its
assets, subject to, among other things, being able to raise
sufficient additional financing to fund its exploration
programs. There can be no assurance that the Company will be
able to raise sufficient additional financing to fulfill its
expenditure commitments or complete its exploration programs.

During 2001, subsequent to receiving shareholder and regulatory
approval, the Company issued 16,164,970 shares at $0.10 per
share as part of a plan to settle outstanding payables and other
liabilities. Various creditors accepted a total of 12,450,911
shares, reducing the Company's liabilities by $1,245,090, with a
corresponding increase in share capital of the same amount.
Goldcorp received 11,734,264 shares of Lexam in exchange for
settlement of $1,173,426 in payables, which included an
outstanding demand loan due to Goldcorp, along with accrued
interest, totaling $1,070,337. Goldcorp's equity interest in
Lexam, upon receiving shares for debt, increased from 31% to
47%.

Of the 16,164,970 shares issued, 3,782,678 were issued to Lexam
as custodian for certain creditors. These shares were issued to
be distributed to additional creditors that had not yet accepted
shares in exchange for payables. In 2002, the remaining
undistributed shares that were being held by Lexam as custodian,
totaling 3,714,059 shares, were cancelled.

The Company is pursuing several alternatives to improve its
financial position, including joint venturing certain
properties, seeking additional sources of debt or equity
financing and investigating possible reorganization
alternatives.

2. General

The unaudited interim period consolidated financial statements
have been prepared by the Company in accordance with Canadian
generally accepted accounting principles. The preparation of
financial data is based on accounting policies and practices
consistent with those used in the preparation of the audited
annual consolidated financial statements. The accompanying
unaudited consolidated financial statements should be read in
conjunction with the notes to the Company's audited consolidated
financial statements for the year ended December 31, 2001.

These unaudited interim consolidated financial statements
reflect all normal and recurring adjustments, which are, in the
opinion of management, necessary for a fair presentation of the
respective interim periods presented.

3. Changes in Accounting Policies

Effective January 1, 2002, the Company adopted the new
recommendations of the Canadian Institute of Chartered
Accountants in Handbook Section 3870, "Stock-based compensation
and other stock-based payments". Section 3870 is applied
prospectively to all stock-based payments to non-employees
granted on or after January 1, 2002.

The Company accounts for all stock-based payments to non-
employees granted on or after January 1, 2002, using the fair
value based method. Stock options granted to employees are
accounted for as a capital transaction. Grants made to non-
employees outstanding at January 1, 2002, the new
recommendations are applied retroactively, without restatement.
The changes have not had an impact on the Company's financial
position. The Company is also required to disclose the pro forma
effect of accounting for stock option awards granted to
employees subsequent to January 1, 2002, under the fair value
based method. During the six months ended June 30, 2002, the
Company has not awarded any stock options.

4. Capital Stock

At June 30, 2002, the Company had 38,107,436 common shares
outstanding. If all outstanding options had been exercised a
total of 42,027,436 shares would have been outstanding.


MAIL-WELL: Closes Sale of Filing Products Division to IFC Unit
--------------------------------------------------------------
Mail-Well, Inc., (NYSE: MWL) has consummated the sale of its
filing products division, for an undisclosed amount.  The
purchaser is International Filing Company, LLC, a privately held
company owned by IFC Filing, LLC, based in Exton, Pennsylvania.
IFC Filing, LLC was formed by Gerald Mahoney, the former
chairman of Mail-Well, Inc., along with management and other
investors to effect the purchase.

"The sale of our filing products division is a another important
step in the implementation of our strategic plan, narrowing our
lines of business and reducing our debt load," said Paul Reilly,
Mail-Well's chairman, president and CEO.  "International Filing
Company represents an exciting opportunity for the customers,
management and employees of the filing products division."

Mr. Reilly continued, "With this transaction, together with the
other dispositions previously announced, and with the cash set
aside for the redemption of the 5% convertible bonds, the
company faces no maturities on its debt before 2005."

Headquartered in Englewood, Colorado, Mail-Well specializes in
three growing multi-billion market segments in the highly
fragmented printing industry: commercial printing, envelopes and
printed office products.  These divisions achieved sales of $1.9
billion in 2001.  Mail-Well divested its label division in May
2002.  Mail-Well has over 11,000 employees and more than 80
printing facilities and numerous sales offices throughout North
America.

                         *    *    *

As reported in Troubled Company Reporter's July 22, 2002
edition, Mail-Well completed the refinancing of its bank debt by
securing a new $300 million senior secured credit facility. Part
of the availability of this new credit facility was used to pay
off existing bank debt. As a result of this refinancing, the
Company wrote-off deferred financing fees as an extraordinary
loss of $5.4 million, net of income taxes. As a result of the
foregoing, the Company's net loss was $34.3 million for the
quarter compared to a net loss of $92.5 million during the
second quarter of 2001. On a year to date basis, the Company's
net loss was $56.0 million compared to a net loss of $88.9
million for the comparable period of 2001.

Also, in a previous report, Standard & Poor's lowered its
corporate credit rating  on Mail-Well Inc., to double-'B'-minus
from double-'B', its subordinated debt rating to single-'B' from
single-'B'-plus, and its senior secured and senior unsecured
debt ratings to double-'B'-minus from double-'B'.

At the same time, Standard & Poor's assigned its double-'B'-
minus rating to Mail-Well I Corp.'s $300 million senior secured
revolving bank facility due 2005, which is guaranteed by its
holding company parent, Mail-Well Inc., and all non-borrower
subsidiaries.

The outlook is negative.


MERRY-GO-ROUND: Trustee Attacks Fidelity's $20MM Melville Claim
---------------------------------------------------------------
Way back in 1993, Melville Corp., (n/k/a CVS Corp.) sold 487
Chess King stores to Merry-Go-Round Enterprises, Inc.  When
Merry-Go-Round filed for bankruptcy in 1994, Melville was owed
$29.4 million under a note received in connection with the sale
of the Chess King division.  Additionally, at that time,
Melville guaranteed roughly $91 million of Chess King's rental
and lease-related obligations for 423 of the Chess King leases
sold.

Along came Belmont Capital Partners, II, L.P., Fidelity Capital
and Income Fund, Belmont Fund, L.P., and Fidelity Copernicus
Fund, L.P. (all affiliated with Fidelity Research and Management
Company), offering to buy Melville's claim for 86 cents-on-the-
dollar in cash on account of the Note and a promise to indemnify
Melville for 52.5% of any costs incurred under the lease
guarantees during Merry-Go-Round's bankruptcy.  Melville, as the
bankruptcy community knows, accepted the offer.

During the course of Merry-Go-Round's bankruptcy, Melville paid
$20,176,575.88 to Chess King landlords.  The Fidelity Entities,
in turn, filed a claim against Merry-Go-Round for these
payments.

Deborah H. Devan, the Chapter 7 Trustee overseeing Merry-Go-
Round's liquidation, now objects to Fidelity's $20 million
claim.  Cynthia L. Leppert, Esq., at Neuberger, Quinn, Gielen,
Rubin & Gibber, P.A., in Baltimore, argues that Merry-Go-Round
should have to pay the lease indemnification claims because the
Estate never got the chance to object.  Ms. Leppert explains
that the original Stock Purchase Agreement with Melville
contains a notice provision that nobody paid attention to.

Ms. Devan says that Fidelity hasn't explained why the payments
were reasonable, many landlord settlements appear to be high (to
the tune of 57% of remaining rent), and there's no indication of
what standard was applied to measure a landlord's damages.  For
these reasons, Ms. Devan asks Judge Derby to disallow Fidelity's
$20 million lease indemnification claim.


MERRILL LYNCH: Fitch Hatchets Class F P-T Certs. Down to B-
-----------------------------------------------------------
Merrill Lynch Mortgage Investors, Inc.'s commercial pass-through
certificates, series 1995-C2 $14 million class F is downgraded
to 'B-' from 'B' by Fitch Ratings and is removed from Rating
Watch Negative. In addition, Fitch affirms the remaining classes
as follows: $79.3 million class A-1, $21.4 million class A-2,
and interest-only class IO at 'AAA', $14.6 million class B at
'AA+', $17.6 million class C at 'A+', $17.6 million class D at
'BBB' and $13.9 million class E at 'BB'. The $26.3 million class
G is not rated by Fitch. The rating downgrade and affirmations
follow Fitch's annual review of the transaction, which closed in
October 1995.

The downgrade of class F is primarily due to expected losses on
several loans in special servicing. These losses are anticipated
to reduce the lowest, non-rated class of certificates by
approximately $20 million and significantly affect the credit
enhancement levels of class F. The losses are attributed to four
real estate owned loans (totaling 18.3% of the pool), one loan
in foreclosure (2.1%), and another loan in special servicing
where the property is vacant (3.4%). In January 2002 Fitch had
placed class F on Rating Watch Negative due to concerns of
losses and exposure to the bankrupt retailer, Kmart. The
downgrade is a result of additional specially serviced loans and
more accurate loss estimates.

Fitch also recognized that after expected losses, the
transaction will not be able to support the 'target credit
enhancement levels' described in the deal documents to maintain
the pro rata pay structure. It is expected that the losses will
lower the credit support beyond the target levels and the deal
will begin to pay sequentially.

The largest loan in the pool (8.45%), collateralized by an
anchored retail center in Athens, GA, received a new appraisal
resulting in an appraisal reduction in June 2001. The center is
currently REO and 40% occupied. The property is being marketed
and Fitch assumed losses in excess of $9 million, which accounts
for cumulative servicing advances, deferred interest and other
expenses.

The second largest loan (6.2%) is collateralized by an anchored
retail center in Humble, TX and is also REO. An appraisal
reduction was performed in October 2000 after a new appraisal
valued the property at $11.2 million. At this time, Fitch
assumed a loss of over $3 million on the total exposure of the
loan of $13.7 million and based on offers received from
prospective buyers.

The two other REO loans are collateralized by two other retail
centers. One (1.9%) is located in Bristol, TN and the other
(1.7%) in Apopka, FL. Both loans have received new appraisals
indicating the value to be less than the outstanding loan
balances, therefore Fitch assumed losses on these loans as well.

Excluding the four REO loans, there are three additional loans
in special servicing. These include a hotel in foreclosure
(1.5%) and two retail properties, both of which contain a vacant
former Kmart space. One is located in Niles, IL (3.4%) and the
other is located in Plainview, TX (1.5%).

Fitch reviewed each of the above loans in addition to the other
65 remaining loans. The overall debt service coverage ratio
using year-end 2001 financial information for the 73% of the
pool that reported is 1.51 times compared to 1.37x at issuance.
While the DSCR has improved, Fitch recognized that many loans of
concern, including loans with expected losses, did not report
financial statements and the overall DSCR does not accurately
reflect the performance of the entire pool. Fitch analyzed each
loan and assumed loans that were identified as a concern were to
default at high probability and loss severity. After liquidating
loans with expected losses, the resulting subordination levels
were insufficient to support the class F, thus prompting the
downgrade.


METROLOGIC INSTRUMENTS: 2nd Quarter Sales Slides up 5% to $29MM
---------------------------------------------------------------
Metrologic Instruments, Inc. (NASDAQ: MTLG), a leading
manufacturer of sophisticated imaging systems using laser,
holographic, camera and vision-based technologies, high-speed
automated data capture solutions and bar code scanners, reported
its financial results for the second quarter ended June 30,
2002.

Sales for the second quarter ended June 30, 2002 increased by 5%
to approximately $29.4 million compared with approximately $28.1
million for the same period a year ago. Sales for the second
quarter increased 7% compared with sales for the first quarter
of 2002 of approximately $27.5 million.

Pre-tax income was approximately $0.4 million before non-
recurring credit agreement-related charges of approximately $0.9
million related to the Company's negotiations of its previously
announced Amended and Restated Credit Agreement compared with a
pre-tax loss of $1.5 million for the same period a year ago.

The total costs related to the Amended Credit Agreement were
approximately $1.0 million, which includes approximately $0.59
million of legal and other professional fees, interest of $.13
million due to the default interest rate, a $.13 million write-
off of previously capitalized financing costs and $0.15 million
of costs capitalized at June 30, 2002, which will be amortized
over the life of the Amended Credit Agreement.

Net income before the credit agreement-related charges was
approximately $0.3 million compared with a net loss of
approximately $0.9 million for the same period a year ago. Net
loss for the three months ended June 30, 2002 after the non-
recurring credit agreement-related charges was approximately
$0.3 million.

Sales for the six months ended June 30, 2002 were $56.9 million
compared with $57.8 million for the same period a year ago. Pre-
tax income for the six months ended June 30, 2002 was
approximately $0.7 million before non-recurring charges related
to the Company's Amended Credit Agreement and severance costs
both totaling approximately $1.2 million compared with a pre-tax
loss of $11.3 million for the same period a year ago. Net income
before the non-recurring charges was approximately $0.5 million
compared with a net loss of approximately $7.0 million for the
same period a year ago. Net loss for the six months ended June
30, 2002, after the non-recurring charges, was approximately
$0.3 million.

Metrologic continued to generate positive cash flow from
operations of approximately $5.9 million and $8.3 million for
the three and six months ended June 30, 2002, respectively.
There was approximately $8.1 million of cash and restricted cash
at June 30, 2002. If the credit agreement had been executed by
June 30, 2002, approximately $7.7 million of this cash would
have been applied to the reported bank debt of approximately
$27.0 million. Upon execution of the Amended Credit Agreement,
the $7.7 million cash was applied to reduce the bank debt to
$19.3 million.

Commenting on the second quarter results, C. Harry Knowles,
Chairman and CEO of Metrologic stated, "We are glad to get the
bank negotiations behind us. We can now focus on increasing our
profits and cash flow by improving sales and decreasing costs.
We anticipate augmenting our sales through the introduction of
new products in each of our product categories: POS, OEM and
Industrial. We have now started to ship production units of our
new iQ(TM)180 vision systems camera on a $1.9 million contract.
Based on the number of customer orders for evaluation units, I
believe that there is significant potential for sales growth for
this powerful high speed imaging system. We anticipate that our
introduction of new POS and OEM products later this year should
help us expand our penetration in the these markets."

Mr. Knowles continued, "The cost reduction program initiated in
April, which reduced costs in excess of $3 million on an
annualized basis, began to pay off in Q2, and should continue to
help profits moving into Q3 and Q4. The recent trend in the
increasing value of the eurodollar relative to the US dollar
should provide additional profits on our European sales for Q3
and Q4. We will be continuing our reductions in costs through
selective programs where needed."

Thomas E. Mills IV, President and COO stated, "We continued to
improve the Company's working capital with further improvement
in accounts receivable collections and in reduced inventory
levels. The increase in the value of the euro relative to the US
dollar provided a boost to earnings in the second quarter,
however unplanned legal and other costs partly offset these
gains in the second quarter. Accordingly, we have adjusted our
forward projections for legal fees. The 2002 outlook below takes
the euro value and the other increased costs into
consideration."

                          2002 Outlook

Metrologic expects third quarter 2002 sales of approximately
$28.2 million and net income of approximately $0.01 to $0.03
diluted earnings per share. Based on the current global economic
conditions, Metrologic expects sales for the full year of 2002
to be approximately $114 million or approximately the same as in
2001. Metrologic believes that net income for the year ending
December 31, 2002 will be in the range of $0.20 to $0.25 diluted
earnings per share before various non-recurring charges.

Metrologic designs, manufactures and markets bar code scanning
and high-speed automated data capture systems solutions using
laser, holographic, camera and vision-based technologies.
Metrologic offers expertise in 1D and 2D bar code reading,
portable data collection, optical character recognition, image
lift, and parcel dimensioning and singulation detection for
customers in retail, commercial, manufacturing, transportation
and logistics, and postal and parcel delivery industries. In
addition to its extensive line of bar code scanning and vision
system equipment, the company also provides laser beam delivery
and control systems to semi-conductor and fiber optic
manufacturers, as well as a variety of highly sophisticated
optical systems. Metrologic products are sold in more than 100
countries worldwide through Metrologic's sales, service and
distribution offices located in North and South America, Europe
and Asia.

                         *     *     *

As reported in Troubled Company Reporter's July 15, 2002
edition, Metrologic Instruments executed an Amended and Restated
Credit Agreement with its banks.

In connection with the Agreement, the banks have waived all
existing defaults and have withdrawn the notice of default.
Additionally, the term of the Agreement is through May 31, 2003.
As a result of the execution of the Agreement, Metrologic
expects to file an amended Annual Report on Form 10-K for the
year ended December 31, 2001 with the Securities and Exchange
Commission, which should include an unqualified opinion from its
independent auditors and a reclassification of a portion of bank
debt from short-term to long-term liabilities.


NEON COMMS: Court Fixes August 26, 2002 General Claims Bar Date
---------------------------------------------------------------
The U.S. Bankruptcy Court for the District Of Delaware fixed
August 26, 2002 as the General Claims Bar Date by which NEON
Communications, Inc., and NEON Optica, Inc.'s creditors must
file proofs of claim or be forever barred from asserting that
claim.  The Court also established December 23, 2002 as the
Governmental Unit Bar Date

There are three exceptions to the Bar Date.  Creditors holding:

     * Claims against the Debtors are not listed as "disputed",
       "contingent" or "unliquidated" in the Debtors'
       Schedules; and

     * Claims previously allowed by this Court;

do not need to file proofs of claim.  Additionally:

     * Individual holders of the 12-3/4% Senior Notes due 2008,
       do not need to file proofs of claim because the Indenture
       Trustee will file one aggregate Claim for all of the
       12-3/4% noteholders.

To be validly and properly filed, Proofs of Claim must be
actually received by Bankruptcy Services LLC no later than 4:00
p.m. on the applicable Bar Date. If sent by mail, the proof of
claim must be mailed to:

     the Claims Agent at:

     NEON Communications, Inc./
     NEON Optica, Inc. Claims Processing
     P.O. Box 5270 FDR Station
     New York, N.Y. 10150-5270;

if sent by messenger or overnight courier, to:

     The Claims Agent at:

     NEON Communications, Inc. /
     NEON Optica, Inc. Claims Processing
     c/o Bankruptcy Services LLC
     70 East 55th street, 6th Floor
     New York, N.Y. 10022-3222

and a copy of the proof of claim to:

     Pepper Hamilton LLP
     1201 North Market Street, 16th Floor
     Wilmington, Delaware 19801

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


NEWPOWER: Seeking Interim Okay to Use Enron's Cash Collateral
-------------------------------------------------------------
The New Power Company and its debtor-affiliates ask the U.S.
Bankruptcy Court for the Northern District of Georgia for
authority to use the Enron's Cash Collateral on an interim
basis.

The Debtors believe that the Enron Creditors are the only
creditors who will be affected by this request.  The Enron
Creditors' claim against the Debtors consists of principal and
interest payable to the Enron Creditors arising in connection
with the Note. The Debtors tell the Court that they need to use
the Cash Collateral for their purchase of commodities to enable
them to meet their day-to-day supply obligations to their
customers pending the consummation of a Sale Transaction.

The Debtors intend to pay Enron Creditors all principal and
interest with the first available proceeds from any Sale
Transaction, but not later than August 31, 2002.

The Debtors contend that the Enron Creditors enjoy a substantial
"equity cushion" that adequately protects their interests with
respect to the Debtors' use of Cash Collateral. Nevertheless, to
enhance the protection of the Enron Creditors' claim, the
Debtors propose to provide the Enron Creditors with additional
collateral, in the form of valid and perfected first priority
replacement liens on all prepetition and post-petition Accounts
Receivable and Inventory.

Before commencing these cases, the Debtors negotiated the terms
of this Interim Motion with the Enron Creditors. The agreement
with the Enron Creditors has not been finalized but pending
final hearing and to continue their business operation, the
Debtors require the Court's authorization to use Cash Collateral
in accordance with the DIP Budget:

     Period                     Cash Inflow       Cash Outflow
     ------                     -----------       ------------
     June 10  - June 28         $26,212,000       $44,686,000
     July 1   - July 31          15,097,000        42,351,000
     August 1 - August 30         5,714,000        28,878,000
     Sept. 3  - Sept. 30          3,975,000        26,805,000

The Debtors, a provider of electricity and natural gas to
residential and small commercial customers in markets that have
been deregulated to permit retail competition, filed for chapter
11 protection on June 11, 2002. Paul K. Ferdinands, Esq., at
King & Spalding and William M. Goldman, Esq., at Sidley Austin
Brown & Wood LLP represent the Debtors in their restructuring
efforts. When the Company filed for protection form its
creditors, it listed $231,837,000 in assets and $87,936,000 in
debts.


PENN TREATY: S&P Says Option Exercise Will Not Affect Ratings
-------------------------------------------------------------
Standard & Poor's Ratings Services said Penn Treaty American
Corp.'s (CCC-/Stable/--) August 6, 2002, announcement that
Centre Solutions (Bermuda) Ltd. (a subsidiary of Zurich
Financial Services Group) has exercised its option to reinsure a
portion of the company's long-term care insurance policies
issued after January 1, 2002, and it will have no effect on the
ratings at this time or on its largest subsidiary insurer, Penn
Treaty Network America Insurance Co. (PTNA) (B-/Stable/--).
Consummation of the reinsurance transaction is subject to
agreement by the parties with definite terms and related
documentation.

The proposed reinsurance agreement, which would reinsure the
long-term care insurance policies on a limited quota share
basis, will aid Penn Treaty in managing the statutory capital
strain typically associated with new business production.
Standard & Poor's will continue to monitor the company's
progress as it attempts to reestablish its position in the long-
term care insurance market after previously having suspended new
sales.


PHARMACEUTICAL FORMULATIONS: Rights Offering Extended to Oct. 23
----------------------------------------------------------------
Pharmaceutical Formulations, Inc., (OTC Bulletin Board: PHFR) is
extending its current rights offering to shareholders and
employee stock option holders for a period of 75 days to October
23, 2002.  The rights offering had been scheduled to expire on
August 9, 2002.

Each person who was a holder of PFI common stock at the close of
business on May 7, 2002, other than ICC Industries Inc., has
received 2.8 subscription rights for each share of common stock
they hold.  Each employee of PFI who is holder of an option to
purchase common stock has received 2.8 rights for each share of
common stock covered by the option agreement.  The ratio of 2.8
rights for each share of common stock will enable non-ICC
stockholders to restore their percentage interests in the
Company substantially to the level that existed prior to the
recent ICC conversions. This was the objective used in the
determination of the number of rights per share.  Rights holders
will be entitled to purchase one share of common stock for each
right held at a price of $.34 per share.  An aggregate of
34,467,741 shares of common stock will be sold if all rights are
exercised.

PFI has undertaken this rights offering for two reasons:
firstly, to enable its stockholders, other than ICC, to be able
to purchase additional shares of its common stock at the same
price as was used to effectuate conversions of debt and
preferred stock by ICC in December 2001 and January 2002; and
secondly, to raise additional capital.

ICC Industries Inc., the holder of approximately 74.5 million
shares (approximately 87%) of the common stock of PFI, is a
major international manufacturer and marketer of chemical,
plastic and pharmaceutical products with 2001 sales in excess of
$1.6 billion.

As of June 30, 2001, Pharmaceutical Formulations has a total
shareholders' equity deficit of about $26 million.


PHAR-MOR: Court OKs Agency Pact Selling Assets to Hilco-Ozer JV
---------------------------------------------------------------
As previously reported, on September 24, 2001, Phar-Mor, Inc.
filed voluntary petitions for bankruptcy protection, on behalf
of itself and its eight operating subsidiaries, under Chapter 11
of the United States Bankruptcy Code in the United States
Bankruptcy Court for the Northern District of Ohio (Case Nos.
B-01-4-4007 through B-01-4-4015).

On July 18, 2002, the Company entered into an Agency Agreement
for the sale of substantially all of its inventory, pharmacy
prescription files and fixed assets with a joint venture
composed of Hilco Merchant Resources, LLC and The Ozer Group
LLC. The joint venture was the highest bidder at a bankruptcy
court approved auction held on July 16, 2002 and will pay the
Company $104,825,000, subject to adjustment as provided in the
Agreement, for the assets. The Agency Agreement was approved by
the Bankruptcy Court on July 18, 2002. The Company plans to
liquidate its remaining assets as soon as possible.


PLANVISTA CORP: Fails to Comply with Nasdaq Listing Standards
-------------------------------------------------------------
PlanVista Corporation (NYSE:PVC) intends to move to the NASDAQ
National Market upon completion of its pending offering. The
Company has filed a registration statement with the Securities
and Exchange Commission and expects to price this offering and
sign an underwriting agreement with the underwriters within the
next several weeks and could do so as early as Monday August 12,
2002. Conditioned upon completion of this offering, the Company
has been approved to list its shares on the NASDAQ National
Market subject to meeting the listing requirements of that
market which the Company expects to meet upon completion of the
offering.

The Company has received a notice from the New York Stock
Exchange that because of recent declines in the price of the
Company's stock, as of July 30, 2002, the Company is non
compliant with the Exchange's continued listing standards and,
as such is subject to suspension of trading. The Exchange has
further notified the Company that if it wants to submit a plan
to bring itself back into compliance with the listing
requirements within 18 months it must submit that plan on an
expedited basis before Wednesday, August 14, 2002, rather than
within 45 days as permitted by Exchange Rule 802. If the
offering is not priced by Wednesday, the Company intends to
submit such a plan.

The Exchange's letter indicates that the plan will be reviewed
for final disposition by the Listing and Compliance Committee of
the Exchange which will either accept the plan and the Company
will be subject to quarterly monitoring for compliance with the
business plan or the Committee will not accept the plan and the
Company will be subject to suspension by the Exchange and
delisting by the SEC. If the Committee does not accept the plan,
the Exchange has indicated that the Exchange would extend a
courtesy market for three trading days from the date of the
notice of the Committee's decision so as to allow the Company to
make alternate arrangements for the trading of its shares. If
the NYSE were to suspend trading in the Company's common stock
and delist the Company from the NYSE prior to the Company
signing an Underwriting Agreement with the underwriters in the
current offering and implementation of trading on the NASDAQ
National Market, the Company's Common Stock would only trade on
the OTC Bulletin Board until it meets the listing requirements
for and is listed on some other national exchange. Until and
unless the offering is completed the Company does not expect to
be able to meet the initial listing requirements of the NASDAQ
National Market System.

A registration statement relating to the Company's Common Stock
has been filed with the Securities and Exchange Commission but
has not yet become effective. These securities may not be sold
nor may offers to buy be accepted prior to the time that the
registration statement becomes effective. This press release
shall not constitute an offer to sell or the solicitation of an
offer to buy nor shall there be any sale of these securities in
any State in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the
securities laws of any such State.

PlanVista Solutions is a leading health care technology and
product development company, providing medical cost containment
for health care payers through one of the nation's largest
independently owned full-service preferred provider
organizations. PlanVista Solutions provides network access,
electronic claims repricing, and claims and data management
services to health care payers and provider networks throughout
the United States. Visit the Company's Web site at
http://www.planvista.com


RSL COM: Gets Plan-Filing Exclusivity Extension Until October 11
----------------------------------------------------------------
Judge Allan L. Gropper of the U.S. Bankruptcy Court in Manhattan
on Monday granted RSL Com USA Inc., an extension of the periods
in which only the company may file a chapter 11 reorganization
plan and solicit votes for its plan, according to a court order
obtained by Dow Jones Newswires.  RSL Com USA now has until
October 11 to file a reorganization without the threat of
competing plans being filed.  If the company files a plan by
that date, other entities would be further prohibited from
filing plans for RSL Com USA through December 9, while the
company collects plan votes, reported the newswire.

The Pittsburgh-based company filed for chapter 11 bankruptcy on
March 16, 2001, listing assets of $308.5 million and liabilities
of $536.9 million as of March 1, 2001. (ABI World, Aug. 8, 2002)


READER'S DIGEST: Court Nixes Attempt to Enjoin Recapitalization
---------------------------------------------------------------
The Reader's Digest Association, Inc., (NYSE: RDA, RDB)
announced that the Delaware Court of Chancery denied the motion
to enjoin its pending recapitalization transaction.

Reader's Digest stated that it is very pleased with the court's
decision.

The Reader's Digest Association, Inc., is a global publisher and
direct marketer of products that inform, enrich, entertain and
inspire people of all ages and cultures around the world.
Revenues were $2.4 billion for the fiscal year ended June 30,
2002.  Products include Reader's Digest magazine, the most
widely read magazine in the world, published in 19 languages, 48
editions and more than 60 countries.  Global headquarters are
located at Pleasantville, New York.  For information, visit
http://www.rd.com

                         *    *    *

As reported in Troubled Company Reporter's May 2, 2002, the
'BB+' bank loan rating on Reader's Digest Association Inc.'s
$1.14 billion credit facilities reflect its market positions in
the highly competitive publishing and direct marketing
industries, offset by weak profitability and increasing
financial risk resulting from the proposed debt-financed $760
million acquisition of Reiman Publications and a $100 million
share repurchase. Rating outlook is negative.


RUSSIAN TEA ROOM: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------------
Lead Debtor: Russian Tea Room Realty LLC
             150 W. 57th Street
             New York, NY 10019

Bankruptcy Case No.: 02-13855

Debtor affiliates filing separate chapter 11 petitions:

     Entity                                     Case No.
     ------                                     --------
     RTR, LLC                                   02-13856

Chapter 11 Petition Date: August 9, 2002

Court: Southern District of New York

Debtors' Counsel: Jordan A. Kroop, Esq.
                  Squire, Sanders & Dempsey L.L.P.
                  350 Park Avenue
                  New York, NY 10022-6022
                  (212) 872-9800

Estimated Assets: $10 million to $50 million

Estimated Debts: $10 million to $50 million

Debtor's 20 Largest Unsecured Creditors:

Entity                     Nature of Claim        Claim Amount
------                     ---------------        ------------
Arrow Linen Supply         Trade                       $26,140

Buckhead Beef              Trade                       $53,550

Caspian Star Cavier Inc.   Trade                       $36,192

Con Edison                 Utilities                   $34,261

Dairyland                  Trade                       $42,390

Envision Comm\Aventis      Banquet Deposit             $27,300

G.A.F Seelig               Trade                       $29,557

Gotham Seafood             Trade                       $38,131

H.E.R.E. Local 100         Contributions For           $43,001
                           Union Medical Insurance

Hereiu Welfare Funds       Trade                       $43,000

Ken Kimmelman              Trade                       $25,745

London Meat                Trade                       $35,657

Madison Performance Group  Banquet Deposit            $120,000

Minerva Cleaners           Trade                       $26,844

Peter's Fruit              Trade                       $36,588

Reuters America            Banquet Deposit             $32,500

Tavern On The Green Trade, Loans                    $1,351,582
1995 Broadway
18th Floor
New York, NY 10019

Tech Data                  Banquet Deposit             $30,000

Trager & Haymond           Banquet Deposit             $30,000

Urbani Truffles            Trade                       $26,299


SLI INC: NYSE Suspends Stock Trading
------------------------------------
SLI Inc., (NYSE: SLI) confirmed that the New York Stock Exchange
announced on August 5, 2002 that the common stock of SLI, Inc.
should be suspended immediately. Under the rules of the NYSE,
the Company has a right to a review of this determination by a
Committee of the Board of Directors of the NYSE.

The Company also confirmed that the NYSE application to the
Securities and Exchange Commission to delist the issue is
pending the completion of applicable procedures, including any
appeal by the Company of the NYSE staff's decision.

The Company continues to explore all available alternatives to
restructuring its existing debt and addressing its current
liquidity issues.

SLI Inc., based in Canton, MA, is a vertically integrated
designer, manufacturer and seller of lighting systems, which are
comprised of lamps and fixtures.  The Company offers a complete
range of lamps (incandescent, fluorescent, compact fluorescent,
high intensity discharge, halogen, miniature incandescent, neon,
LED and special lamps).  They also offer a comprehensive range
of fixtures.  The Company serves a diverse international
customer base and markets, has 31 plants in 30 countries and
operates throughout the world. SLI, Inc., is also the #1 global
supplier of miniature lighting products for automotive
instrumentation.

For more information, visit its Web site at
http://www.sliinc.com


SAFETY-KLEEN: Committee Taps Genovese Joblove as Special Counsel
----------------------------------------------------------------
The Official Committee of Unsecured Creditors in the Chapter 11
cases of Safety-Kleen Corp., and its debtor-affiliates, seeks
the Court's authority to retain Genovese Joblove & Battista PA,
nunc pro tunc to June 19, 2002, as special litigation lead
counsel in the adversary proceeding styled, "Official Committee
of Unsecured Creditors v. Toronto Dominion (Texas) Inc.

Committee Co-Chair Sharon Manewitz of the Teachers Insurance &
Annuity Association of America, tells the Court that Genovese's
services include the investigation and prosecution of the
adversary proceeding and any other litigation to challenge the
amount, validity, enforceability, perfection or priority of the
prepetition obligations of Safety-Kleen or the prepetition
Agent's liens on the prepetition collateral.

Genovese professionals will be compensated pursuant to the
firm's standard hourly rates.  The current hourly rates are:

              $400     senior partners
              $300     partners
              $255     associates
              $110     paralegals

These rates are subject to annual adjustments.

Establishing a bright-line contingency fee in cases like this is
complicated because values remain uncertain, particularly with
respect to distributions to unsecured creditors.  Accordingly,
the Committee and Genovese have agreed to define "success", for
purposes of a contingency fee, as a plan of reorganization
supported by the Committee.  To the extent that occurs, which
means a plan that provides a distribution to unsecured
creditors, Genovese will be entitled to receive a contingency
fee equivalent to the greater of $1,500,000, or three times the
fee incurred, but not previously paid, based on their hourly
rates.  The contingency fee will be reduced by the amount of
attorney hours paid, if any, pursuant to applications submitted
to the Court for approval.  Genovese is not required to, but
may, advance costs greater than $50,000.  The first funds
recovered into the estate from any source which are available
for use in litigation against the prepetition Agent and lenders
will be used to create a reserve to pay litigation expenses with
any remaining funds being used to pay expert fees in an amount
agreed upon by Genovese and the Committee.

If 180 days after its commencement the litigation has not been
resolved favorably, as determined by the Committee, to the
extent funds are recovered into the estate as proceeds from
litigation commenced by Genovese, Genovese's agreement will
revert to the maximum contingency rate allowed by law plus
reimbursement of costs, less any payments received on fee
applications submitted to the Court for approval.  To the
extent, after 180 days following the commencement of litigation
by Genovese, funds are not received into the estate from such
litigation, but there is a confirmed plan of reorganization
endorsed by the Committee that results in a distribution to the
Debtors' unsecured creditors, Genovese will receive a success
fee equivalent to the greater of $2,500,000, or three times the
fees incurred, but not previously paid, based upon the hourly
rates set forth in this Application.  The enhanced success fee
will be reduced by any amounts paid pursuant to the applications
submitted to the Court for approval.

John H. Genovese, a Genovese shareholder, assures the Court that
the firm does not hold any interest adverse to Safety-Kleen's
estates or their creditors in the matters on which Genovese is
to be engaged.  The firm is disinterested, Mr. Genovese asserts.
However, Mr. Genovese discloses that Charles H. Lichtman, Esq.,
a shareholder of the firm who resigned in 2001, represented, and
may currently represent, certain institutional Lenders in small
equipment leasing matters.  The attorneys who worked or
currently work on these matters are no longer with the firm.

Mr. Genovese further advises the Court that the firm has
recently been retained by Bank of America, as co-trustee with
two additional trustees on a lease obligation in the bankruptcy
proceedings of In re Fedco Pharmacies, Inc. to file a proof of
claim and defend any objections to the claim on behalf of the
trustees.  "The firm does not believe that this representation
is a conflict for the proposed retention, nor does it call into
question the firm's disinterestedness," Mr. Genovese contends.

                   Lenders' Limited Objection

Rebecca L. Booth, Esq., at Richards Layton & Finger PA, in
Wilmington, Delaware, notes that the Committee and its financial
advisors over the past two years expended 13,000 hours and over
$4,000,000 in professional fees and expenses investigating
potential claims against the secured lenders.  After this
mammoth investigation, the Committee now seeks authority to
engage additional professionals at the expense of the secured
lenders, as the economic stakeholders in the Debtors' estates,
to assist in the further investigation and prosecution of
potential claims against the secured lenders.

TD Securities (USA), Inc., on behalf of itself and as
administrative agent for 120 financial institutions holding over
$1,600,000,000 secured and unsecured claims against the Debtors,
is not too happy about this development.

"It is indisputable that the value of the Debtors' estates is
substantially less than the secured claims of the secured
lenders and that there are de minimis assets that are not
subject to the liens and security interests of the secured
lenders," Ms. Booth says.  Moreover, Ms. Booth adds, the value
of any such "free assets" would be consumed by the
extraordinarily high costs and expenses of administration of
these Chapter 11 estates.  Consequently, the Committee,
realizing any distribution to unsecured creditors is remote, has
threatened litigation against the secured lenders since the
inception of these cases for the purpose of extracting an
unwarranted recovery for its constituents.  According to Ms.
Booth, the proposed engagement of Genovese is a further segment
in the Committee's strategy of harassment and intimidation of
the Lenders.

Therefore, the Lenders object to the Committee's application and
the funding of additional professionals and duplicative
services.  The Lenders also object to the Committee's request to
create a reserve from funds of the Debtors' estates to pay for
Genovese. (Safety-Kleen Bankruptcy News, Issue No. 43;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


SALTON SEA: S&P Cuts Rating on $592MM Senior Secured Notes to BB
----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on Salton
Sea Funding Corp.'s $592 million of senior secured bonds, series
B, C, E, and F, to double-'B' from triple-'B'-minus and removed
the rating from CreditWatch. The outlook is developing.

The rating was lowered despite credit-strength improvements at
power offtaker, Southern California Edison Co. (SCE,
BB/Developing/--).

Salton Sea's rating was placed on CreditWatch on December 21,
2000, as Standard & Poor's ratings on SCE fell below investment
grade. Standard & Poor's recently upgraded various SCE debt
issues as a result of a federal court settlement between SCE and
the California Public Utility Commission (CPUC) over recovery of
purchased power costs. Nonetheless, the continuing regulatory
and political uncertainties that dominate the credit profile for
SCE can no longer support an investment-grade rating for Salton
Sea Funding Corp.

The CPUC settlement removes the immediate, but not the longer-
term, threat of a bankruptcy filing, voluntary or otherwise,
that has confronted SCE for over a year. While Standard & Poor's
had expected that the regulatory situation would become clearer
by now (and indeed the CPUC represented that it entered into the
settlement with the goal of restoring SCE's creditworthiness to
investment grade), it is still impossible to determine SCE's
long-term creditworthiness.

As a result of the CPUC settlement, SCE will pay Salton Sea a
fixed 5.37 cents per kilowatt-hour for the next five years in
lieu of the short-run avoided cost (SRAC) price, which was tied
to natural gas market prices. In addition, SCE will continue to
pay the original contract capacity prices through the tenor of
the contracts.


SILVER STAR FOODS: Zeller Weiss Expresses Going Concern Doubt
-------------------------------------------------------------
Silver Star Foods, Inc., has been a distributor of a wide range
of pre-packaged frozen pasta products in 11 states in the United
States, mainly in the New York metropolitan area. The Company
sells its products such as ravioli and tortellini, primarily to
supermarket chains and local distributors within these states.
The Company's products were not promoted during most of the
fiscal year ending March 31, 2002. However, there were a nominal
amount of sales in March 2002. Commencing April 2002, Silver
Star Foods re-established its promotional activities and
starting making presentations to additional customers within the
New York metropolitan area. As of April 2002, it has been re-
slotted in the New York metropolitan area in the Key Foods
stores. The Company's intention is to increase its
sales/revenues with the hope of creating its own manufacturing
facility in the United States. There is the belief within the
Company, although there can be no assurance, that acquiring
manufacturing capacity and entering into agreements with sales
representatives will enable it to expand its customer base to
supermarket chains and small distributors in other regional
markets and to large volume customers such as club stores,
restaurant chains and customers requiring a private label
manufacturer.

In 1930, the grandfather of the Company's President opened a
pasta shop in Brooklyn, New York under the name Silver Star
Ravioli & Macaroni Co., Inc. During the next twenty years, SSRM
developed an excellent reputation for its hand-made pasta around
New York. In the early 1950's, SSRM expanded by opening a 25,000
square foot factory with one of the first mechanized ravioli
machines.

With increased production capabilities, SSRM was able to supply
large supermarket chains with its food products. During this
time, SSRM distributed its food products to a number of grocery
chains and numerous independent stores in the five boroughs of
New York and Long Island. In addition to retail outlet stores,
SSRM opened institutional accounts that included airlines and
cruise ships. SSRM also expanded its geographic area and, with a
select network of brokers, began to distribute its food products
to the tri-state area, in addition to upstate New York,
Philadelphia, Baltimore, Florida, Arizona and California. During
this time, SSRM was owned and operated by members of the Trotta
family, including Michael Trotta, the present President and
Vincent Trotta, who serves as Company advisor.

By the late 1980's, SSRM's manufacturing equipment was outdated.
Competitors with newer factories and equipment were able to
produce products at lower cost and on a more flexible schedule.
As a result, sales margins suffered. SSRM's attempts to upgrade
the facility, which was over thirty years old, were ineffective.
Debts incurred in connection with the attempted upgrade
eventually led to the bankruptcy of SSRM.

In 1995, Michael Trotta formed the Company under the name Silver
Star Ravioli. The name was changed  to Silver Star Foods, Inc.
in July 1997. The Silver Star trademark had been in use since
the original Company was formed and acquired the trademark from
Vincent Trotta in 1997 for $205,000 and acquired the right to
use Vincent Trotta's name in connection with promotions in April
1998.

Today, retail pasta products sales in the United States total
over $500 million, as published in the trade magazine.

Silver Star Foods net sales were $3,890 for the year ending
March 31, 2002 as compared to $282,747 for the year ending March
31, 2001, a decrease of $278,857 (98%). The decrease is
attributable to management's decision to reduce the amount of
promotional activity during this time due to the amount of time
and effort required in connection with ongoing efforts to
complete a registered offering, and the Company's lack of
operating capital.

Costs of sales decreased during the year ending March 31, 2002
to $1745 from $245,090 for the year ending March 31, 2001, a
decrease of $243,345 (99%). The decrease corresponds to the
decrease in sales for the comparative periods. As a percentage
of net sales, costs of sales were approximately 45% and 87% for
the years ending March 31, 2002 and 2001 respectively.

Operating expenses increased to $275,920 from $258,603 for the
year ending March 31, 2002 as compared to 2001, an increase of
$17,317 (7%).

Amortization expense for the comparative periods was $13,677 in
each of the years ending March 31, 2002 and 2001 in relation to
the trade name.

The Company experienced net losses in both periods, a net loss
for the year ending March 31, 2002 of $287,442 and a net loss of
$234,613 for the year ending March 31, 2001, an increase of
$52,829 (23%). Zeller, Weiss & Kahn, LLP, of Mountainside, New
Jersey, and Silver Star's independent auditors, state in their
May 24, 2002 Auditors Report:  "[T]he Company has incurred
continuing losses. This condition raises substantial doubt about
its ability to continue as a going concern."


STAR TELECOMMS: Delaware Court Confirms Amended Liquidation Plan
----------------------------------------------------------------
STAR Telecommunications, Inc., announced that its First Amended
Plan of Liquidation of the Debtor and the Official Committee of
Unsecured Creditors has been confirmed by the United States
Bankruptcy Court for the District of Delaware. According to the
plan, all of STAR's assets will be transferred to a liquidating
trust, and the proceeds from the liquidation of those assets
will be distributed to STAR's creditors. When the plan becomes
effective, STAR shall be deemed dissolved under applicable state
laws.

STAR filed a voluntary petition for U.S. Bankruptcy Code Chapter
11 bankruptcy protection on March 13, 2001 and STAR's securities
were subsequently delisted by Nasdaq on April 4, 2001.


US STEEL: Fitch Affirms BB Senior Unsecured Long-Term Rating
------------------------------------------------------------
Fitch Ratings affirmed the senior unsecured long-term ratings of
U.S. Steel at 'BB' and assigned a 'BB+' rating to the company's
senior secured revolver. The Rating Outlook is Stable. Since the
beginning of the year, the prices of hot-rolled and cold rolled
steel sheet have risen dramatically and with them U.S. Steel's
profits. On shipment increases of 619 thousand tons and price
realizations of $12/ton more, U.S. Steel has turned an operating
loss of $61 million in the first quarter of 2002 into an
operating profit of $47 million in the second quarter. Price
increases have been announced effective in August and September;
the company's order book is extended into October; and the
weaker dollar in concert with 30% disputed steel tariffs should
temper future imports. U.S. Steel's seven domestic furnaces are
operating at near capacity, and the company is projecting a
profit for the year. Liquidity is strong following the company's
mid-May stock offering.

U.S. Steel will likely somehow figure into the politically
encouraged consolidation going on in the steel industry
(Nucor/Trico/Birmingham and Corus/CSN). Recent discussions have
included a potential combination with National Steel, and U.S.
Steel is continuing discussions with third parties. The company
purchased U.S. Steel Kosice (Slovak Republic) in November 2000.
Any substantive change in the business profile of U.S. Steel
could impact the company's ratings.


US AIRWAYS: ALPA Pilots Ratify Restructuring Plan Agreement
-----------------------------------------------------------
The pilots of US Airways, as members of the Air Line Pilots
Association, ratified its restructuring plan agreement with 76
percent approving.

"This is one of a number of steps necessary to restructure our
airline and return our company to profitability," said David N.
Siegel, US Airways president and chief executive officer.  "Our
negotiations with ALPA have been professional and constructive
and the ratification of this agreement clearly symbolizes the
new spirit of partnership and cooperation that we have worked to
develop with our employees.  I want to thank ALPA's leadership
and its members for ratifying this agreement."

"The US Airways ALPA pilots, through their membership vote, have
decided to participate in US Airways' restructuring and help our
company through difficult times and to assist its long-term
recovery," said Capt. Chris Beebe, chairman of the Master
Executive Council of the US Airways unit of ALPA.  "The pilots'
ratification of the US Airways - ALPA Restructuring Agreement
represents a tremendous sacrifice from all US Airways pilots,"
said Capt. Beebe.

While this ratification is a significant step in the
restructuring process, US Airways has yet to complete successful
restructuring plans with all stakeholders, including several
remaining labor unions, vendors, and aircraft lessors and
lenders.  There can be no assurance that these efforts will be
successful on a voluntary basis.  If such voluntary efforts are
not successful, a Chapter 11 filing may be required to obtain
the necessary relief from other key stakeholders that remain
unwilling to work with US Airways on a voluntary financial
restructuring.

US Airways has reached tentative agreements on its restructuring
plan with the Association of Flight Attendants, and the
Transport Workers Union dispatchers, simulator engineers, and
flight crew training instructors. Agreements have not been
reached yet with the International Association of Machinists,
representing separate mechanic and related positions, and fleet-
service worker units, and the Communications Workers of America.


US AIRWAYS: Files for Chapter 11 Reorganization in Virginia
-----------------------------------------------------------
US Airways Group, Inc. (NYSE: U), announced that, in order to
facilitate the prompt completion of its restructuring
initiatives, the Company and certain of its subsidiaries filed
voluntary petitions for reorganization under Chapter 11 of the
Bankruptcy Code.  The airline said Sunday's action will allow
the company to effect cost savings from aircraft lessors and
financiers and other key stakeholders as a means of ensuring the
Company's return to profitability.

"Ultimately, this effort is about our customers, employees, and
the communities we serve, as we seek to fix the airline's
finances and return to profitability.  US Airways will continue
to operate while we complete our financial restructuring, and
our customers should be confident that we will continue service
to the more than 200 communities in our network," said US
Airways President and Chief Executive Officer David Siegel.
"Our Dividend Miles program will continue to offer millions of
fliers significant award benefits throughout the restructuring
process and beyond, and the co-branded US Airways/Bank of
America credit card and similar programs will be unaffected.
Our employees, whose hard work and dedication are essential to
the success of our restructuring, will continue to be paid on
their regular payroll schedule and benefit programs will
continue.  Vendors will be paid in the ordinary course for goods
and services provided going forward."

The Company filed its petitions on Sunday evening in the U.S.
Bankruptcy Court for the Eastern District of Virginia in
Alexandria.  The Company's petitions listed assets of
approximately $7.81 billion and liabilities of approximately
$7.83 billion.  The Court has scheduled a hearing on the
Company's first day motions for 10:30 a.m. EDT today, Aug. 12,
2002, before the Honorable Robert G. Mayer in Courtroom No. 3 at
the Martin Bostetter Jr. U.S. Courthouse in Alexandria.

US Airways has secured commitments for $500 million in debtor-
in-possession (DIP) financing from a group of institutions led
by Credit Suisse First Boston and Bank of America Corp., with
participation from Texas Pacific Group, among others.  In a move
to strengthen its balance sheet, US Airways announced that Texas
Pacific Group has entered into a memorandum of understanding to
provide a $200 million investment in the new equity of the
airline upon its emergence from Chapter 11 protection, which the
Company anticipates will be coupled with the $1 billion
collateralized loan backed by the federal guarantee that has
been conditionally approved by the Air Transportation
Stabilization Board.  The Company expects that its court-
supervised restructuring will be accomplished on a "fast-track"
basis and has targeted emergence from Chapter 11 in the first
quarter of 2003.

Siegel said that the participation of top-tier institutions such
as Credit Suisse First Boston, Bank of America, and Texas
Pacific Group was a strong endorsement of the Company's
restructuring plan, the airline's franchise, and the overall
confidence in the eventual rebound of the airline sector.  Under
the terms of its memorandum of understanding, Texas Pacific
Group will make a $200 million investment in the equity of the
airline upon its emergence from Chapter 11 protection.  This
investment, which remains subject to continuing diligence and
final documentation, competing and/or higher offers, and court
approval, would result in Texas Pacific Group owning about 38%
of the airline post-emergence.  In addition, Texas Pacific Group
would hold seats on the reconstituted Board of Directors when US
Airways emerges from Chapter 11 protection.

"In the face of an uncertain and trying time for the industry,
we have been impressed by the major strides taken by US Airways'
management and employees to significantly improve the
competitiveness of the airline," said Richard P. Schifter,
partner, Texas Pacific Group.  "Given the progress made to date,
the time required in Chapter 11 to complete the restructuring
should be relatively brief.  We look forward to finalizing our
arrangements so that, together with the ATSB financing, our
capital and industry experience can contribute to the Company's
prompt emergence and long term prosperity."

US Airways was the hardest hit of U.S. airlines by the aftermath
of September 11.  The prolonged closure of Washington Reagan
National Airport, higher security costs, the economic recession,
and the cutback in travel along the east coast, all contributed
significantly to the Company's financial losses.  Siegel was
appointed president and chief executive officer of the airline
in March 2002, with the task of reversing financial losses which
have exceeded $1.5 billion over the previous four reported
quarters.  After a thorough strategic, operational and financial
review, the Company put in place a three-part restructuring plan
that involves improving liquidity, increasing revenues, and
reducing costs, to allow the Company to take advantage of its
competitive strengths and return to profitability.  So far, the
following milestones have been accomplished:

Improving Liquidity:

The Company said the $500 million DIP facility should provide it
with ample liquidity in the interim during its Chapter 11
proceeding. Additionally, on July 10, 2002, US Airways received
conditional approval from the ATSB for a federal guarantee of
$900 million of a $1 billion loan.  The Company expects to
satisfy all conditions set forth by the ATSB in the context of a
successful court-supervised restructuring in order to secure the
loan's proceeds upon emergence from Chapter 11.  The $1 billion
ATSB loan, and the Texas Pacific Group's $200 million equity
investment, coupled with significant cost reductions and revenue
enhancement initiatives, will dramatically improve the Company's
cash flow and balance sheet, as it implements all aspects of the
restructuring plan to achieve its goal of returning to
profitability.

Increasing Revenues:

In late July, the Company entered into an agreement for a
marketing alliance with United Airlines and submitted the plan
to the U.S. Department of Transportation for review.   The
alliance includes a codeshare agreement to allow passengers to
book tickets on both carriers to a wider array of destinations,
as well as to access both carriers' frequent flier programs and
airport lounges.  Patterned after existing marketing alliances
among other domestic and international carriers, the alliance is
expected to increase the Company's revenues up to $200 million
per year as it helps the airline expand its network beyond its
focus in the eastern U.S. and the Caribbean, providing broader
service to its customers.

In addition, US Airways continues to negotiate with two regional
jet manufacturers -- Embraer and Bombardier.  Both manufacturers
remain committed to providing the airline with a large number of
regional jets.  While commercial terms are nearly complete,
final selection of manufacturers, aircraft size and type depend
on the successful conclusion of an overall restructuring plan
and specific financing terms.  US Airways plans to execute an
order for up to 200 firm deliveries and 300 options for regional
jets, consistent with the RJ scope clause provisions negotiated
in the recently-ratified agreement with the Air Line Pilots
Association.

Reducing Costs:

The Company's restructuring plan is predicated upon achieving
binding commitments for cost-savings from employees, aircraft
lessors and financiers and other parties.   On the labor front,
the Company has ratified agreements with ALPA, the Association
of Flight Attendants, and the Transport Workers Union unit which
represents flight crew training instructors. The Company is
awaiting the ratification of agreements with TWU units for
dispatchers and simulator engineers.  In addition, officers,
management and non-union employees are taking pay cuts,
foregoing bonuses, and taking benefit cuts similar to unionized
workers.

The International Association of Machinists has informed the
Company that it will put out for ratification the final
restructuring package for the mechanics and related work group,
fleet service, and maintenance trainers, which will be
comparable to the cost savings targets set for all other labor
groups.  The remaining union, the Communications Workers of
America, has not yet reached an agreement with US Airways.
However, the Company has asked the CWA to put out for
ratification the restructuring package for customer service and
reservations agents, but has not yet received a formal response.
The Company remains committed to either reaching an agreement
with the CWA, or ensuring that savings are obtained through the
bankruptcy process.

While US Airways was able to successfully negotiate cost-savings
from many of its employee groups, the Company determined that it
was unlikely to conclude consensual negotiations with certain
vendors, aircraft lessors and financiers in a timeframe
necessary to complete an out-of-court restructuring. Siegel
cited as factors the large number of lessors and financiers and
the Company's inability to reject surplus aircraft leases and
return excess aircraft outside of Chapter 11.

"Our employees have not only been running a great airline, but
have also committed themselves to the Company's successful
restructuring.  We recognize the impact the sacrifices they are
making will have on them and their families.  In exchange for
their participation, we have committed that this will be a
labor-friendly Chapter 11 reorganization, in which we will honor
new agreements that have been ratified, and provide labor with a
voice in the Company's governance through representation on the
Board of Directors," Siegel said.  "Our efforts will now be
focused on renegotiating favorable terms with certain large
vendors, lenders and aircraft lessors, which is essential to
accomplish our restructuring initiatives.  Our reorganization is
critical not only to our employees, but also to the economies of
the communities we serve."

US Airways continues its exceptional service record,
consistently placing near the top in the DOT's monthly
statistics for on-time performance, baggage delivery, and
customer service throughout 2002.  In 2001, US Airways finished
first in three of the four DOT quality measurements and was
ranked as the top network carrier by the Airline Quality Rating
index.  The largest air carrier east of the Mississippi where
more than 60 percent of the U.S. population resides, US Airways
operates the seventh largest airline in the United States and
the fourteenth largest airline in the world with approximately

40,000 full-time and part-time employees.  US Airways carried
approximately 56 million passengers last year with regularly
scheduled service to approximately 200 destinations in 38 states
across the United States and in Canada, Mexico, the Caribbean
and Europe.  Operating revenues for the year ended December 31,
2001 were approximately $8.3 billion.

As part of the Company's timetable to emerge from Chapter 11
reorganization, the Company intends to file its disclosure
statement and plan of reorganization by December 31, 2002.  The
Company presently contemplates that one of the elements of any
plan of reorganization may be the cancellation of the Company's
existing equity securities without the prospects of any
distribution to existing holders.  There is no assurance as to
what values, if any, will be ascribed in the Chapter 11 cases as
to the value of the Company's existing common stock and/or any
other equity securities.  Accordingly, the Company urges that
the appropriate caution be exercised with respect to existing
and future investments in any of these securities as the value
and prospects are highly speculative.

DebtTraders reports that US Airways Inc.'s 10.375% bonds due
2013 (U13USR2) are trading between 81.5 and 83.5 . See
http://www.debttraders.com/price.cfm?dt_sec_ticker=U13USR2for
more real-time bond pricing.


US AIRWAYS GROUP: Case Summary & 30 Largest Unsecured Creditors
---------------------------------------------------------------
Lead Debtor: US Airways Group, Inc.
             2345 Crystal Drive
             Arlington, Virginia 22227

Bankruptcy Case No.: 02-83984

Debtor affiliates filing separate chapter 11 petitions:

     Entity                                     Case No.
     ------                                     --------
     US Airways, Inc.                           02-83985
     Allegheny Airlines, Inc.                   02-83986
     PSA Airlines, Inc.                         02-83987
     Piedmont Airlines, Inc.                    02-83988
     MidAtlantic Airways, Inc.                  02-83989
     US Airways Leasing and Sales, Inc.         02-83990
     Material Services Company, Inc.            02-83991

Type of Business: The Company's primary business activity is
                  the ownership of the common stock of US
                  Airways, Inc., Allegheny Airlines, Inc.,
                  Piedmont Airlines, Inc., PSA Airlines, Inc.,
                  MidAtlantic Airways, Inc., US Airways Leasing
                  and Sales, Inc., Material Services Company,
                  Inc. and Airways Assurance Limited, LLC
                  (collectively, the "Wholly-Owned
                  Subsidiaries"). The primary business activity
                  of the Wholly-Owned Subsidiaries is the
                  transportation of passengers, property and
                  mail.

Chapter 11 Petition Date: August 11, 2002

Court: Eastern District of Virginia (Alexandria)

Judge: Stephen S. Mitchell

Debtors' Counsel: Alexander Williamson Powell Jr., Esq.
                  David E. Carney, Esq.
                  Skadden, Arps, Slate, Meagher & Flom
                  1440 New York Ave. N.W.
                  Washington, DC 20005-2111
                  (202)371-7254
                  Fax : (202) 661-9154

                           and

                  Lawrence E. Rifken, Esq.
                  McGuireWoods LLP
                  1750 Tysons Boulevard, Suite 1800
                  McLean, Virginia 22102-3915
                  (703) 712-5337
                  Fax : (703) 712-5250

Total Assets: $7,807,000,000

Total Debts: $7,830,000,000

Debtor's 30 Largest Unsecured Creditors:

Entity                     Nature of Claim        Claim Amount
------                     ---------------        ------------
J.P. MORGAN TRUST COMPANY, Loan                    $71,140,000
NATIONAL ASSOCIATION
Douglas Wilson
One Oxford Center
301 Grant Street, Suite 1100
Pittsburgh, PA 15219 USA
Phone: (412) 291-2080
Fax: (412) 751-9301

WILMINGTON TRUST COMPANY   Trade - Aircraft        $49,989,085
Robert P. Hines, Jr.        Payments
Financial Services Officer,
Corporate Trust
Rodney Square North
1100 North Market Street
Wilmington, DE 19890 USA
Phone: (302) 636-6197
Fax: (302) 636-4140

ELECTRONIC DATA SYSTEMS    Trade - Contractual      $46,909,431
CORPORATION
Doug Frederick
President, Operation Solutions
5400 Legacy Drive
Mail Drop H3-5C-47
Plano, TX 75024 USA
Phone: (972) 797-4069
Fax: (972) 605-4555

STATE STREET BANK AND      Trade - Aircraft Def.   $36,114,451
TRUST CO.                  Payments
E. Decker Adams
Vice President
Global Investor Services
Group
Corporate Trust,
P.O. Box 778
Boston, MA 02102 USA
Phone: (617) 662-1754
Fax: (617) 662-1456 U

FIRST UNION NATIONAL BANK  Trade - Aircraft Def.   $16,285,791
Robert L. Bice              Payments
Corporate Trust Department
401 South Tryon Street
Charlotte, NC 28288 USA
Phone: (704) 715-3021
Fax: (704) 374-6682

GENERAL ELECTRIC CAPITAL   Trade - Aircraft Def.   $12,795,060
CORP.                       Payments
Ron Wainshal
GE Capital Aviation
Services-Structured Finance
201 High Ridge Road
Phone: (203) 316-7560
Fax: (203) 961-6906
Stamford, CT 06927 USA

AIRLEASE                   Trade - Return Claims    $5,814,634
Jad Mansour
Phone: (415) 765-1848
Fax: (415) 765-1817
555 California Street
San Francsisco, CA 94104 USA

ALLEGHENY COUNTY AIRPORT   Trade - Airport Authority $4,589,836
Edward Moeller
1000 Airport Blvd.
Pittsburgh, PA 15231 USA
Phone: (412) 472-5559
Fax: (412) 472-5725

CITY OF PHILADELPHIA       Trade - Airport Authority $3,167,485
Leslie Turner
Phone: (215) 937-5480
Fax: (215) 937-5480
Philadelphia International Airport
Philadelphia, PA 19153

CITY OF CHARLOTTE AIRPORT  Trade - Airport Authority $2,566,909
Carrie Blackwell
5501 Rc Josh Birmingham Parkway
Charlotte, NC 28219 USA
Phone: (704) 359-4023
Fax: (704) 359-4950

LSG SKY CHEFS              Trade - Food Service     $2,542,873
Mike Mesko
524 E Lamar Blvd
Arlington, TX 76011 USA
Phone: (817) 792-2303
Fax: (817) 792-2460

DEBIS                      Trade - Return Claims    $1,830,017
Tim Bergin
100 Ne Third Ave
Suite 800
Ft. Lauderdale, FL 33301 USA
Phone: (954) 760 7777
Fax: (954) 760 7716

BOEING COMMERCIAL          Trade - Aircraft Parts/  $1,297,012
AIRPLANES                  Maintenance
Jennifer Bergsma
635 Park Ave. N.
Mail Code Ms 6X Uj
Attn Cashier Ms 6X Cf
Renton, WA 98055 USA
Phone: (206) 655-1131
Fax: (425) 237-3830

AIR CARGO INCORPORATED     Trade - Cargo Handling   $1,269,841
Jenny White
1819 Bay Ridge Ave
Annapolis, MD 21403 USA
Phone: (410) 280-5568
Fax: (410) 263-8208

BOEING CAPITAL             Trade - Aircraft Def.    $1,090,000
Scott Nicholson             Payments
500 Naches Ave Sw
3Rd Floor Mc 6Y-14
Renton, WA 98055 USA
Phone: (425) 393-0970
Fax: (425) 393-2904

INTERBORO SCHOOL DISTRICT Trade - Airport Authority $1,058,793
Pamela Powell
Philadelphia International Airport Terminal
Philadelphia, PA 19153 USA
Phone: (610)461-6700
Fax: (610) 461-6700

FAIRCHILD DORNIER (NA)    Trade - Aircraft Parts/     $907,030
Ed Methot                  Maintenance
10823 North East Entrance
San Antonio, TX 78216 USA
Phone: (210) 804-7719
Fax: (210) 824-3021

CHARLES E SMITH           Trade - Real Estate         $893,382
COMMERCIAL REALTY          Services
Vicki Lauren
2345 Crystal Drive
Arlington, VA 22202 USA
Phone: (703)769-1254
Fax: (703)769-1190

SAN FRANCISCO AIRPORTS    Trade - Airport Authority   $841,464
COMMISSION
Jess Balageas
San Francisco International Airport
6Th Floor Rm 644
San Francisco, CA 94128 USA
Phone: (650)821-2843
Fax: (650)821-2846

AIRPLANES GROUP           Trade - Return Claims       $798,968
Fiona Roche
Aviation House
Shannon Co. Claire, Ireland
Phone: 353 61 706392
Fax: 353 86 8166392

CUDS UNITED HEALTHCARE    Trade - Medical & Dental    $777,096
Rory Doty
22703 Network Place
Chicago, IL 60673-1227 USA
Phone: (813)818-5613
Fax: (813)854-3359

THE ROYAL BANK OF SCOTLAND Trade - Aircraft Def.      $753,908
Francis Carey               Payments
Manager - Syndicated Loans Agency
135 Bishopsgate
5Th Floor
London, EC2 M 3U R Great Britain
Phone: 020 7648 3814
Fax: 020 7615 0106

HONEYWELL INTERNATIONAL    Trade - Aircraft Parts/     $687,911
INC                         Maintenance
Lori Habeger
875 W Elliot Rd
Ste 106
Tempe, AZ 85284 USA
Phone: (913)712-0400
Fax: (913)712-5867

HAMILTON SUNDSTRAND        Trade - Aircraft Parts/    $608,642
Steven Gabscheid            Maintenance
4747 Harrison Ave.
Rockford, IL 61125 USA
Phone: (815)394-2945
Fax: (815)394-3558

ROCKWELL COLLINS           Trade - Aircraft Parts/    $585,646
Brian J. Seeber             Maintenance
400 Collins Rd. Ne
Cedar Rapids, IA 52498 USA
Phone: (319)295-3293
Fax: (319)295-4092

HIGHWOODS FORSYTH LTD      Trade - Aircraft Parts/    $575,746
PARTNERSHIP                 Maintenance
Allison Saucy
380 Knollwood Street
Ste 430
Winston Salem , NC 27103 USA
Phone: (336)631-9000
Fax: (336)725-1969

TOWERS PERRIN             Trade - Other Professional  $567,848
Mark Duncan
1500 Market Street
Philadelphia, PA 19102-4790 USA
Phone: (416)960-2700
Fax: (416)960-2819

GREATER ORLANDO AVIATION  Trade - Airport Authority   $548,574
AUTHORITY
Patti Everst
One Airport Blvd
Orlando, FL 32827 USA
Phone: (407)825-2017
Fax: (407)825-2259

HILLSBOROUGH COUNTY       Trade - Airport Authority   $502,340
AVIATION AUTHORITY
Ginny Brewer
Tampa International Airport
3Rd Level
Tampa, FL 33607 USA
Phone: (813)870-8700
Fax: (813)875-6670

GOODRICH FAIRHOPE SERVICE Trade - Aircraft Parts/     $404,727
Tammy Simmons              Maintenance
1300 West Ave.
Alabama Service Center
Goodrich Aerostructures Grp
Foley, AL 36535 USA
Phone: (251)952-3377
Fax: (251)952-3376


US AIRWAYS: Machinists Tap Lowenstein and Sandler as Attorneys
--------------------------------------------------------------
"Our members will not give up on US Airways, and neither should
anyone else," said International Association of Machinists and
Aerospace Workers General Vice President Robert Roach, Jr. in
response to the announcement that the company will seek to
restructure the airline in bankruptcy.  "We believe US Airways
can successfully restructure while it continues to serve the
traveling public and provide employment for our members."

The Machinists Union has been meeting with US Airways since May
2002 to discuss IAM member participation in the company's
restructuring plan.  Sunday, IAM District 141-M received a
proposal from the company and will put that proposal to a vote
by its 6,800 Mechanic and Related members.

Additionally, an August 12 meeting is scheduled between the
company and IAM District 141 officials representing 5,450 Fleet
US Airways Service workers.

"The announcement of a bankruptcy filing does not change our
position regarding the company's restructuring plan," said
Roach.  "Our members at District 141-M will vote on the
company's proposal, and if we receive a proposal for our Fleet
Service members, we will present it to those members for their
consideration as well."

"We have retained attorneys Sharon Levine and Peter Ehrenberg
from the firm Lowenstein and Sandler to represent our members
interests," said Roach, "and we will be active participants in
the bankruptcy proceedings."

The IAM represents 12,250 active US Airways employees in the
Mechanic, Utility and Fleet Service classifications.  For more
information about the Machinists Union visit
http://www.goiam.org


VANGUARD AIRLINES: Taps Polsinelli Shalton as Bankruptcy Counsel
----------------------------------------------------------------
Vanguard Airlines, Inc., seeks approval from the U.S. Bankruptcy
Court for the Western District of Missouri to hire Daniel J.
Flanigan, Esq., and Polsinelli Shalton & Welte, P.C. as Counsel
in its Chapter 11 cases.

Vanguard needs Polsinelli on board to:

      (a) advise Vanguard with respect to its powers and duties
          as debtor and debtor in possession in the continued
          management and operation of its business and property;

      (b) attend meetings and negotiate with representatives of
          creditors and other parties in interest;

      (c) take all necessary action to protect and preserve
          Vanguard's estate, including the prosecution of
          actions on its behalf, the defense of any actions
          commenced against the estate, negotiations concerning
          litigation in which Vanguard may be involved, and
          objections to claims filed against the estate;

      (d) prepare on behalf of Vanguard all motions,
          applications, answers, orders, reports, and papers
          necessary to the administration of the estates;

     (e) negotiate and prosecute on Vanguard's behalf sales of
         assets, plan(s) of reorganization, disclosure
         statement(s), and all related agreements and/or
         documents, and take any necessary action on behalf of
         Vanguard to obtain confirmation of such plan;

     (f) appear before this Court, any appellate courts, and the
         United States Trustee, and protect the interests of
         Vanguard's estate before such courts and the United
         States Trustee; and

     (g) perform all other necessary legal services and provide
         all other necessary legal advice to Vanguard in
         connection with the Chapter 11 case.

The Debtor will pay the firm its customary hourly rates, plus
reimburse the firm for actual and necessary expenses incurred.
Compensation will range from:

           a. Partners:               $165 - $350
           b. Associates:             $110 - $180
           c. Paralegals:              $70 - $125
           d. Paralegal Assistants:    $35 - $50

Vanguard Airlines, currently shut-down, used to provide all-jet
service to 14 cities nationwide: Atlanta, Austin,
Buffalo/Niagara Falls, Chicago-Midway, Dallas/Ft. Worth, Denver,
Fort Lauderdale, Kansas City, Las Vegas, Los Angeles, New
Orleans, New York-LaGuardia, Pittsburgh and San Francisco. The
Company filed for Chapter 11 protection on July 30, 2002 at the
U.S. Bankruptcy Court for the Western District of Missouri.
Daniel J. Flanigan, Esq., at  Polsinelli Shalton & Welte, P.C.,
represents the Debtor in its restructuring efforts. When the
company filed for protection from its creditors, it listed total
assets of $39.7 million and total debts of $95.9 million.


WEBLINK WIRELESS: Hires KPMG to Replace Andersen as Accountants
---------------------------------------------------------------
On August 1, 2002, WebLink Wireless, Inc., dismissed Arthur
Andersen LLP as its independent accountants and appointed KPMG
LLP as its new independent accountants effective immediately.
The decision was approved by the Board of Directors of the
Company.

Andersen's report on the financial statements of the Company for
the fiscal years ended December 31, 2000 an 2001 contained a
going concern qualification.


WORLDCOM: Seeks Approval to Employ Ordinary Course Professionals
----------------------------------------------------------------
Worldcom Inc., and its debtor-affiliates need to employ
different professionals that will render a wide range of legal,
accounting, tax, real estate, and other services in the day-to-
day operations of their business.

Accordingly, the Debtors seek the Court's authority to retain
ordinary course professionals without having to submit separate
employment applications, affidavits and the issuance of separate
retention orders for each individual professional.

The Debtors propose to pay each Ordinary Course Professional,
without prior application to the Court, 100% of the fees and
disbursements incurred, after submission to, and approval by,
the Debtors of an appropriate invoice detailing the nature of
the services rendered and disbursements actually incurred.

The Debtors cap the payment at $100,000 per month per Ordinary
Course Professional or for a total of $2,000,000 per month for
all Ordinary Course Professionals.  In the event that an
Ordinary Course Professional seeks more than $100,000 in a
single month or $500,000 in the aggregate in the Debtors'
Chapter 11 cases, that particular professional will be required
to file, in accordance with Sections 330 and 331 of the
Bankruptcy Code, a fee application for the full amount of the
fees.

The prevailing procedures in the New York District Bankruptcy
Code requires that within 15 days after the entry of an Order
granting this Motion, or 15 days after engagement by the
Debtors, each Ordinary Course Professional will serve upon the
US Trustee and the Debtors, and file with the Court:

   (a) an affidavit certifying that such professional does not
       represent or hold any interest adverse to the Debtors or
       their estates with respect to the matter on which the
       professional is to be employed, and

   (b) a completed retention questionnaire.

Marcia Goldstein, Esq., at Weil, Gotshal & Manges LLP, in New
York, assures the Court that although certain Ordinary Course
Professionals hold unsecured claims against the Debtors for
prepetition services, the Ordinary Course Professionals do not
have an interest adverse to the Debtors, their creditors or
other parties-in-interest.  Thus, all of the Ordinary Course
Professionals proposed to be retained meet the special counsel
retention requirement under Section 327(e) of the Bankruptcy
Code.  Ms. Goldstein asserts that it would in the best interest
of the Debtors' estates that the proposed set-up for retaining
Ordinary Course Professionals is approved.  For one, it will
spare the Debtors' estates from incurring substantial expenses
associated with applying separately for the employment of each
professional.  It will also avoid the incurrence of additional
fees related to preparing and prosecuting interim fee
applications.  The outlined procedure will also relieve the
Court and the U.S. Trustee of the burden of reviewing numerous
fee applications involving relatively small amounts of fees and
expenses. (Worldcom Bankruptcy News, Issue No. 3; Bankruptcy
Creditors' Service, Inc., 609/392-0900)

DebtTraders reports that Worldcom Inc.'s 11.250% bonds due 2007
(WCOM07USA1) are trading between 22.5 and 27. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=WCOM07USA1
for more real-time bond pricing.


WORLDCOM INC: SBC Seeks Payment for Future Services to MCI Unit
---------------------------------------------------------------
SBC Communications Inc., (NYSE:SBC) asked a federal bankruptcy
judge in New York to adopt a plan that would ensure that SBC
receives prompt payment for telecommunications services it
continues to provide MCI WorldCom.

Under federal law, utilities must provide services to customers
after they have filed for bankruptcy protection. MCI WorldCom
owed SBC more than $300 million when it filed the single largest
bankruptcy case in history on July 21. Since then, it has
continued to rely on approximately $150 million a month in
services from SBC, adding to its overall debt.

William Daley, president of SBC Communications Inc., said SBC
took the action to protect the interests of its customers,
shareowners and employees. "While SBC and other creditors must
stand in line to collect at least some of what they are owed,
MCI WorldCom has asked the court to require us to continue to
provide service to MCI WorldCom without any adequate assurance
of payment. We should not be forced into being an involuntary,
unsecured lender."

In its filing with the U.S. Bankruptcy Court for the Southern
District of New York, SBC noted that it continues to provide
telecommunications services to MCI WorldCom that generate
significant revenue for the bankrupt carrier.

SBC said that it shared regulators' concerns that MCI WorldCom
customers "not suffer any avoidable interruption of phone
service." It proposed to the court a mechanism to protect those
customers from abrupt service terminations while reducing the
period during which SBC and other companies "would be required
to provide services for which they may not be paid."

SBC asked the court in part to:

     --  Grant SBC a "super-priority lien" in MCI WorldCom
         receivables and proceeds generated by
         telecommunications services provided by SBC;

     --  Require MCI WorldCom to provide a deposit to cover two
         months for all new services; and

     --  Require advance payment for any new or changes to
         existing collocation agreements.

SBC noted that it was asking for nothing more than what MCI
WorldCom itself had sought in a number of recent bankruptcy
cases, including that of Global Crossing where MCI WorldCom
demanded a two-month deposit to assure payment. SBC noted that
MCI WorldCom in its own bankruptcy case is attempting to treat
SBC "in precisely the manner it so vehemently opposed" in the
Global Crossing case.

Thursday's court filing is part of SBC's ongoing effort to
protect the company from the turmoil in the telecommunications
industry. SBC last week filed tariff changes with the Federal
Communications Commission (FCC) to protect the company from
financially troubled carrier customers which are not paying for
services they receive from SBC in a timely manner. In part, the
tariff changes would require non-creditworthy customers that owe
SBC at least $1 million to make a deposit or pre-pay for one
month's service.

"It is unfortunate that the behavior of a few companies and
individuals has had a negative impact on an entire industry,"
Daley said. "We hope the court recognizes that unless it acts
quickly, the fallout from MCI WorldCom will cause further damage
to companies that have steered the right course."

SBC Communications Inc. -- http://www.sbc.com-- is one of the
world's leading data, voice and Internet services providers.
Through its world-class network and its subsidiaries' trusted
brands - SBC Southwestern Bell, SBC Ameritech, SBC Pacific Bell,
SBC Nevada Bell, SBC SNET and Sterling Commerce - SBC companies
provide a full range of voice, data, networking and e-business
services, as well as directory advertising and publishing. A
Fortune 27 company, America's leading provider of high-speed DSL
Internet Access services, and one of the nation's leading
Internet Service Providers, SBC companies currently serve nearly
60 million access lines nationwide. In addition, SBC owns 60
percent of America's second largest wireless company -- Cingular
Wireless -- which serves more than 21 million wireless
customers. Internationally, SBC has telecommunications
investments in 28 countries.


Z-TEL TECHNOLOGIES: June 30 Equity Deficit Reaches $83 Million
--------------------------------------------------------------
Z-Tel Technologies, Inc. (Nasdaq:ZTEL), a leading provider of
local, long distance and enhanced telecommunications services,
announced the Company's financial results for the second quarter
of 2002. For the three-month period ended June 30, 2002, the
Company reported revenues of $62.2 million, compared to $73.1
million for the prior year period. Net income from operations
was $0.3 million versus a net loss from operations of $107.7
million for the second quarter of 2001. For the second quarter
of 2002, net loss attributable to common stockholders was $3.7
million compared to $110.8 million for the prior year period.

For the first time in Z-Tel's history, the Company achieved
positive earnings before interest, taxes, depreciation and
amortization, or "EBITDA." For the second quarter of 2002,
EBITDA was $7.4 million, compared to negative $101.4 million for
the second quarter of 2001. Included in the Company's second
quarter results were the following non-recurring items:

     --  A $9.0 million reduction in network-related costs,
which was attributable to access overpayments that the New York
Public Service Commission determined Z-Tel had made to Verizon
during prior periods

     --  A $1.9 million restructuring charge for employee-
related expenses and certain lease terminations associated with
a workforce reduction the Company implemented in April 2002

     --  A $1.3 million charge for possible exposure to carrier
receivables due to WorldCom's bankruptcy

     --  A $1.1 million write-down of assets attributable to the
April 2002 closing of the Company's North Dakota call centers.

Excluding these non-recurring adjustments, Z-Tel generated
positive EBITDA of $2.7 million during the second quarter of
2002, compared to negative $5.6 million reported during the
first quarter of 2002. In addition, excluding these non-
recurring items, the Company reported a net loss from operations
for the second quarter of $4.4 million compared with a net loss
from operations of $18.6 million for the second quarter of 2001,
excluding non-recurring bad debt and asset impairment charges
totaling $89.1 million. For the latest quarter, net loss
attributable to common stockholders was $8.4 million versus a
net loss attributable to common stockholders of $21.6 million
for the second quarter of 2001, excluding non-recurring bad debt
and asset impairment charges totaling $89.1 million.

Z-Tel Technologies' June 30, 2002, balance sheet shows a total
shareholders' equity deficit of about $83 million, as opposed to
$67 million recorded at December 31, 2001.

The following table shows the impact of the non-recurring items
the Company recorded during the second quarter of 2002 against
the Company's results reported under generally accepted
accounting principles (GAAP).

"We had a very solid second quarter that marked the Company
generating positive EBITDA for the first reporting period in its
history," stated Gregg Smith, president and chief executive
officer for Z-Tel. "Many of the initiatives that we put into
place during the latter part of 2001 are now beginning to
evidence themselves in our financial results. We have achieved
significant advancements in virtually every area of our
business, including enhanced subscriber metrics, improved
customer care and the overall reduction of overhead-related
expenditures. We also took solid steps forward within the
regulatory arena, both at the federal and state levels, and we
expanded our first commercial product, Z-LineBUSINESS(TM), into
eight new markets. The Company's continued progress is
gratifying to all Z-Tel constituents."

"As expected," Mr. Smith continued, "the implementation of our
wholesale agreement with MCI and the rapid expansion of their
local phone service initiative, The Neighborhood, contributed to
our improved financial results during the second quarter. MCI
has repeatedly stated that customer adoption of The Neighborhood
has substantially exceeded its expectations. According to MCI,
it has attracted more than 800,000 accounts to The Neighborhood,
a majority of which is using Z-Tel services. We are pleased to
note that sales of The Neighborhood continue to exceed expected
levels, even since WorldCom's bankruptcy filing, and it's clear
that the program is a success."

Trey Davis, chief financial officer for Z-Tel, stated, "While
our relationship with MCI did positively contribute to our
second quarter results, our underlying operating performance
fundamentally improved in several areas and contributed to the
Company's generation of positive operating cash flow during the
second quarter. Furthermore, we expect to realize additional
financial improvements over the second half of the year, due in
part to the monthly savings that are now being fully realized
from the workforce reduction and closure of our North Dakota
call center facilities that occurred in April 2002. July was the
first full month in which these incremental savings were
reflected on our Income Statement."

Mr. Davis added, "From a liquidity perspective, the Company
enjoyed some success during the second quarter and into July. We
renewed our accounts receivable facility with RFC Capital for an
additional two years, and MCI paid us $5.5 million during July
in connection with our wholesale services agreement. Currently,
our cash position exceeds the level reported at the end of the
second quarter."

"With regard to our wholesale services arrangement with MCI,
while we remain very enthusiastic about the prospects of further
growth of The Neighborhood and believe that our exposure level
to WorldCom's bankruptcy remains relatively low, we plan to
carefully analyze our expenditures related to our wholesale
relationship with MCI as we move forward. While we are working
with MCI to gain adequate assurance with respect to future
payments that we expect to earn in connection with our wholesale
agreement, we also remain committed to our partnership, and we
will continue to work diligently with MCI to achieve our mutual
goals."

"In addition to the growing success of our wholesale business,"
Mr. Smith added, "we are making solid strides in key operating
areas related to our retail business, including reduced customer
service costs, lower churn rates and improved provisioning
times. With a current retail base of approximately 200,000
active subscriber lines, we believe we have turned the corner
with respect to subscriber exposure, and we expect our
subscriber metrics to continue to improve over the course of the
second half of the year."

Mr. Smith concluded, "We have a great deal to look forward to
for the remainder of 2002. Building on our current success,
we've formed a business development group, headed up by Dumas
Garrett, senior vice president, that is dedicated to forging
new, lucrative wholesale and affiliate marketing relationships.
We are already seeing progress in these areas and are in
negotiations with several potential partners. We've also
augmented our sales force and have hired representatives in six
major cities to focus on marketing Z-LineBUSINESS. In addition,
while our speech recognition application is in alpha test phase,
we expect full commercial roll out during the fourth quarter.
Combined with a residential business that gets healthier every
day and our maturing wholesale business, we expect these
initiatives to keep us in a position to deliver comparable or
improved financial results over the remainder of 2002."

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

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


ZAMBA SOLUTIONS: June 30 Balance Sheet Upside-Down by $3 Million
----------------------------------------------------------------
ZAMBA Solutions (OTCBB:ZMBA), announced its results for the
second quarter of 2002. Revenues before reimbursement for direct
costs were $2,230,000, compared to $8,020,000 for the second
quarter of 2001. Net loss was $2,042,000 compared to a net loss
of $5,286,000 for the second quarter of 2001.

ZAMBA's June 30, 2002 balance sheet shows a working capital
deficit of about $4 million, and a total shareholders' equity
deficit of about $3 million.

"It is good to back on board, and I am very encouraged by the
progress we have made in my first five weeks" said Norm Smith,
President and Chief Executive Officer at ZAMBA. "We have great
people helping great clients become more competitive in a very
difficult economy. I strongly believe ZAMBA's unique strategic
sourcing and onsite/offsite (blended shore) business model will
help our clients address the need for more cost-efficient
services. We also want to accelerate our path to profitability
and enhance our relationship with our strategic partner, HCL."

ZAMBA Solutions is a leading technology services company,
providing strategic sourcing and integration services solutions
to large and medium-scale organizations. ZAMBA's unique
onsite/offsite (blended shore) business model helps our clients
address their need for more cost-efficient services and ongoing
support of an enterprise's technology and customer service
infrastructure.

ZAMBA's clients have included ADC, Aether Systems, Best Buy,
Blue Cross Blue Shield, Canon ITS, GE Medical Systems, Enbridge
Services, Hertz, General Mills, Microsoft Great Plains, Northrop
Grumman, Symbol Technologies, Towers Perrin, Union Bank of
California, and Volkswagen of America. The company has offices
in Denver, Minneapolis, San Jose, and Toronto. For more
information, contact ZAMBA at http://www.ZAMBAsolutions.comor
(800) 677-9783.


* Fitch Discusses SEC Certifications and Companies' Ratings
-----------------------------------------------------------
With the clock ticking on the Securities and Exchange
Commission's (SEC) Aug. 14, 2002 filing date for chief executive
officers and chief financial officers to certify their company's
financial statements, Fitch Ratings has been asked its opinion
on the certification's impact on corporations themselves, the
capital markets and Fitch's ratings. In response, Fitch is
actively monitoring and analyzing the situation and possible
rating implications; the process and some of the analytical
considerations are enumerated upon below.

Fitch believes the overwhelming majority of companies will meet
the certification deadline. While as of this morning (Friday
Aug. 9, 2002), only 104 companies have filed the certification,
Fitch believes the slow response reflects coordinating the
certification letter filing with the filing of the 10(Q)
financial statement. However, for those companies that fail to
file the certification, or file with nonstandard language, Fitch
believes the resultant financial implications as well as more
immediate liquidity pressures brought about by the market's
reaction, particularly the commercial paper market, may
lead to some rating actions.

                         BACKGROUND

Following a series of corporate financial restatements, some of
which involved fraud and other improprieties, The SEC, on June
27, 2002, mandated the chief executive officers and chief
financial officers of the largest 947 U.S. publicly traded
companies to certify the accuracy of their published financial
statements. By taking this action, the SEC hopes to reinforce
the integrity of financial reporting as well as restore investor
confidence. In order to enhance investor confidence, the SEC is
conducting this inquiry in the public arena, posting all of the
certification letters to its web site and encouraging all
companies filing to publicly release their certifications. The
SEC has provided a format and specific language for the
certification letters. With all letters available on the SEC web
site, those companies not filing a certification, or filing a
certification without the SEC standard language, will be subject
to SEC review as well as more immediate investor scrutiny.
Of the 947 companies, 745 are subject to the Aug. 14
certification deadline with the remainder subject to deadlines
extending into December. Those companies that have a later
certification deadline use audited fiscal years that do not
coincide with the calendar year. The SEC is not accepting
delayed certifications, unless it receives a formal request for
an extension. By sector, power generators, transmission, and
energy marketers, are among the largest with approximately 65
companies on the list, followed by banks and insurance
companies with approximately 50 each. The problematic telecom
sector is represented with 16 companies.

                   Court of Public Opinion

Fitch believes that the fallout from adverse publicity from a
company either failing to file a certification, or filing one
without the standard language, will be as great or greater than
any sanctions or penalties imposed by the SEC itself. An
extension to the filing may be requested, but Fitch believes any
company requesting an extension will also be subject to adverse
publicity.

                     Not Without Parallel

The certification requirement by the SEC is not without
parallel. The banking industry has been subject to similar
certifications, by both officers and directors, in all financial
reports submitted to banking regulators.

Ironically, while bank regulatory financial reports are not
audited, they have been proven to be extremely accurate and
reliable. Even the highly publicized financial restatement by
PNC Financial Group, necessitated by an off-balance sheet
structure, involved only the financial reports filed with the
SEC and not the bank regulatory financial reports. Once
restated, the SEC filed financial reports were in conformity
with the accounting treatment already used on the year-end
regulatory reports. With the banking industry heavily
represented on the SEC's required certification list, Fitch
believes the SEC certification will not present any substantive
issues for the U.S. banking industry.

                        Not a Panacea

While the intended benefits of the certification, increased
accounting integrity and investor confidence, are likely to be
achieved, the certification program does not address a lingering
concern as to the latitude given companies and independent
auditors to interpret Generally Acceptable Accounting Principles
(GAAP). This is further exacerbated by basic underlying
accounting treatments, including depreciation and amortization
and accounting for pension and retirement plans, which can vary
widely among companies. Hopefully, the certification program
will be both a discipline and a deterrent to financial
fraud and the abuse of liberal accounting practices. While
certification is welcome, Fitch would like to see the
development of a comparability benchmark for each industry or
sector, where each company's principal accounting practices
and assumptions would be publicly available and compared to
industry established norms. Such information would be an
invaluable tool for the investing public.

                     Not the Final Word

The certifications are only a part of the SEC's investigation,
'to ascertain facts, conditions, practices and other matters
relating to the financial statements and accounting practices of
certain large publicly traded companies.  In this regard, the
SEC may adopt or amend rules and regulations governing corporate
issuers' reporting and accounting practices and/or recommend
legislation to Congress.'  Given the heightened interest and
concern by investors and politicians, additional disclosures or
rules seem likely.

                    QUESTIONS AND ANSWERS

-- How is Fitch preparing for the Aug. 14 certification
   deadline?

Ratings implications for companies that fail to meet the Aug. 14
certification requirement, are probably most pronounced at
entities with Negative Outlooks, listed for Rating Watch
Negative, and are heavy users of short-term debt (particularly
commercial paper) or face large near term debt maturities. For
one reason or another, these companies were already facing some
stress, and their ratings were considered at risk. Fitch will
monitor these companies against the certification postings. In
addition, Fitch continues to closely monitor companies within
certain sectors that have already had identified accounting
issues, including telecom and energy merchants. Ultimately,
Fitch expects to review the certifications of all rated
companies subject to the certification requirement.

Approximately 77 rated companies affected by the certification
requirement currently carry Negative Outlooks, and another 19
are listed on Rating Watch Negative (all for reasons apart from
any concerns from the SEC certification requirement). From a
ratings distribution perspective, of the rated companies
subject to certification, 97 carry Fitch ratings of 'BBB-' or
below.

-- Are there ratings or other implications for companies that
   fail to file the certification by the Aug. 14 deadline?

The immediate concern is one of liquidity, particularly those
that are active commercial paper issuers or those with pending
debt maturities. The market reaction to those companies that
have previously announced accounting irregularities (WorldCom
and Qwest for example) has been immediate. Fitch believes the
market response for those companies that fail to file, and even
those requesting an extension, may limit their ability to access
commercial paper or even bank funding. Also, the SEC may impose
fines or make referrals for criminal charges depending on the
seriousness of the situation.

Within this scenario, there will be no automatic downgrades by
simply failing to file, or filing a certification without the
standard language. Some companies may be unable to file based on
already announced accounting restatements such as Qwest and CMS
Energy. While rare, pre-existing circumstances may preclude a
company from being able to file. Fitch believes some downgrades
would be inevitable, however, and will review each certification
issue on a case by case basis and examine the extent of the
problem or inaccuracy that has been revealed before considering
rating implications.

-- Are there ratings implications if a company restates its
   financials?

As with any restatement, Fitch will review the magnitude of the
restatement to determine whether any rating actions are
warranted. Many times, restatements do not result in rating
changes, as they may affect non-cash items. Some other
restatements have largely involved timing issues as reported
items may be recognized in different reporting periods.

-- What has been the impact on current debt issuance? How will
   this impact future debt issuance?

Corporate debt issuance in July was extremely light and is
expected to be the same in August. With the SEC certification
deadline approaching, Fitch believes corporate issuers were
reluctant to issue and investors were reluctant to purchase,
pending the certification of their financial statements. In
addition, corporate bond spreads remain wide, reflecting a
growing flight to quality. This is particularly true of autos
and utilities, which are typically among the largest issuers,
but both remain out of favor with investors. Once companies
have submitted their certifications, Fitch believes issuance
should rise reflecting the removal of this uncertainty as well
as pent-up demand.

-- What about non-U.S. corporations?

The SEC mandate applies only to U.S. public corporations.
Bermuda-based corporations, such as Tyco, are not subject to the
mandate. In the future, foreign issuers active in the U.S.
capital markets will be subject to the certification
requirements as per recent legislation (Sarbanes-Oxley Act of
2002).


* BOND PRICING: For the week of August 12 - August 16, 2002
---------------------------------------------------------

Issuer                                Coupon  Maturity  Price
------                                ------  --------  -----
ABGenix Inc.                           3.500%  03/15/07    67
AES Corporation                        4.500%  08/15/05    25
AES Corporation                        8.000%  12/31/08    35
AES Corporation                        8.750%  06/15/08    38
AES Corporation                        8.875%  02/15/11    31
AES Corporation                        9.375%  09/15/10    61
AES Corporation                        9.500%  06/01/09    60
Adaptec Inc.                           3.000%  03/05/07    73
Adelphia Communications                3.250%  05/01/21     7
Adelphia Communications                6.000%  02/15/06     7
Adelphia Communications               10.875%  10/01/10    30
Advanced Energy                        5.250%  11/15/06    72
Advanced Micro Devices Inc.            4.750%  02/01/22    69
Aether Systems                         6.000%  03/22/05    62
Alternative Living Services (Alterra)  5.250%  12/15/02     4
Alkermes Inc.                          3.750%  02/15/07    44
Alexion Pharmaceuticals Inc.           5.750%  03/15/07    63
Amazon.com Inc.                        4.750%  02/01/09    62
American Tower Corp.                   9.375%  02/01/09    54
American Tower Corp.                   2.250%  10/15/09    62
American Tower Corp.                   5.000%  02/15/10    45
American Tower Corp.                   5.000%  02/15/10    44
American Tower Corp.                   6.250%  10/15/09    52
American & Foreign Power               5.000%  03/01/30    58
Amkor Technology Inc.                  5.000%  03/15/07    45
Amkor Technology Inc.                  6.250%  10/15/09    52
Amkor Technology Inc.                  9.375%  02/01/09    54
Amkor Technology Inc.                 10.500%  05/01/09    70
AnnTaylor Stores                       0.550%  06/18/19    60
Armstrong World Industries             9.750%  04/15/08    42
AMR Corporation                        9.000%  09/15/16    73
AMR Corporation                        9.750%  08/15/21    74
AMR Corporation                        9.800%  10/01/21    74
Atlas Air Inc.                         9.250%  04/15/08    51
AT&T Corp.                             6.500%  03/15/29    71
AT&T Wireless                          7.875%  03/01/11    68
AT&T Wireless                          8.125%  05/01/12    61
AT&T Wireless                          8.750%  03/01/31    70
Best Buy Co. Inc.                      0.684%  06?27/21    67
Bethlehem Steel                        8.450%  03/01/05    14
Borden Inc.                            7.875%  02/15/23    60
Borden Inc.                            8.375%  04/15/16    68
Borden Inc.                            9.250%  06/15/19    62
Borden Inc.                            9.200%  03/15/21    70
Boston Celtics                         6.000%  06/30/38    64
Brooks Automatic                       4.750%  06/01/08    74
Browning-Ferris Industries Inc.        7.400%  09/15/35    64
Burlington Northern                    3.200%  01/01/45    44
Burlington Northern                    3.800%  01/01/20    63
CSC Holdings Inc.                      7.625%  07/15/18    71
CSC Holdings Inc.                      7.875%  02/15/18    73
CSC Holdings Inc.                      8.125%  07/15/09    74
Calpine Corp.                          4.000%  12/26/06    54
Calpine Corp.                          8.500%  02/15/11    52
Case Corp.                             7.250%  01/15/16    74
Centennial Cell                       10.750%  12/15/08    57
Century Communications                 8.875%  01/15/07    34
Champion Enterprises                   7.625%  05/15/09    52
Charter Communications, Inc.           4.750%  06/01/06    38
Charter Communications, Inc.           5.750%  10/15/05    41
Charter Communications, Inc.           5.750%  10/15/05    41
Charter Communications Holdings        8.250%  04/01/07    54
Charter Communications Holdings        8.625%  04/01/09    71
Charter Communications Holdings        9.625%  11/15/09    65
Charter Communications Holdings       10.000%  04/01/09    56
Charter Communications Holdings       10.000%  05/15/11    62
Charter Communications Holdings       10.250%  01/15/10    55
Charter Communications Holdings       10.750%  10/01/09    70
Charter Communications Holdings       11.125%  01/15/11    68
Ciena Corporation                      3.750%  02/01/08    59
Cincinnati Bell Telephone (Broadwing)  6.300%  12/01/28    64
Cincinnati Bell Inc. (Broadwing)       7.250%  06/15/23    74
CIT Group Holdings                     5.875%  10/15/08    74
Coastal Corp.                          6.375%  02/01/09    57
Coastal Corp.                          6.500%  05/15/06    71
Coastal Corp.                          6.500%  06/01/08    60
Coastal Corp.                          6.700%  02/15/27    67
Coastal Corp.                          6.950%  06/01/28    38
Coastal Corp.                          7.420%  02/15/37    40
Coastal Corp.                          7.500%  08/15/06    72
Coastal Corp.                          7.625%  09/01/08    63
Coastal Corp.                          7.750%  06/15/10    57
Coastal Corp.                          7.750%  10/15/35    42
Coastal Corp.                          9.625%  05/15/12    61
Coastal Corp.                         10.750%  10/01/10    69
Coeur D'Alene                          6.375%  01/31/05    73
Coeur D'Alene                          7.250%  10/31/05    70
Comcast Corp.                          2.000%  10/15/29    19
Comforce Operating                    12.000%  12/01/07    56
Computer Associates                    5.000%  03/15/07    72
Conseco Inc.                           8.125%  02/15/03    64
Conseco Inc.                           8.750%  02/09/04    20
Conseco Inc.                          10.500%  12/15/04    66
Continental Airlines                   4.500%  02/01/07    60
Continental Airlines                   7.568%  12/01/06    74
Corning Inc.                           3.500%  11/01/08    54
Corning Inc.                           6.300%  03/01/09    63
Corning Inc.                           6.750%  09/15/13    55
Corning Inc.                           6.850%  03/01/29    52
Corning Inc.                           8.875%  08/15/21    68
Corning Glass                          8.875%  03/15/16    72
Cox Communications Inc.                0.348%  02/23/21    68
Cox Communications Inc.                0.426%  04/19/20    37
Cox Communications Inc.                3.000%  03/14/30    27
Cox Communications Inc.                6.800%  08/01/28    71
Cox Communications Inc.                6.950%  01/15/28    73
Cox Communications Inc.                7.750%  11/15/29    26
Critical Path                          5.750%  04/01/05    63
Critical Path                          5.750%  04/01/05    63
Crown Castle International             9.000%  05/15/11    63
Crown Castle International             9.375%  08/01/11    64
Crown Castle International             9.500%  08/01/11    65
Crown Castle International            10.750%  08/01/11    71
Crown Cork & Seal                      7.375%  12/15/26    55
Crown Cork & Seal                      8.375%  01/15/05    72
Cubist Pharmacy                        5.500%  11/01/08    50
Cummins Engine                         5.650%  03/01/98    62
Dana Corp.                             7.000%  03/01/29    70
Dana Corp.                             7.000%  03/15/28    70
Delta Air Lines                        8.300%  12/15/29    69
Dillard Department Store               7.000%  12/01/28    74
Dobson Communications Corp.           10.875%  07/01/10    60
Dobson/Sygnet                         12.250%  12/15/08    74
Dresser Industries                     7.600%  08/15/96    60
Dynegy Holdings Inc.                   6.875%  04/01/11    74
EOTT Energy Partner                   11.000%  10/01/09    67
Echostar Communications                4.875%  01/01/07    68
Echostar Communications                5.750%  05/15/08    66
Echostar Communications                5.750%  05/15/08    69
El Paso Corp.                          7.750%  01/15/32    56
El Paso Energy                         6.750%  05/15/09    69
Enzon Inc.                             4.500%  07/01/08    70
Enzon Inc.                             4.500%  07/01/08    69
Equistar Chemicals                     7.550%  02/15/26    64
E*Trade Group                          6.750%  05/15/08    75
E*Trade Group                          6.750%  05/15/08    74
Finisar Corp.                          5.250%  10/15/08    55
Finova Group                           7.500%  11/15/09    31
Fleming Companies Inc.                 5.250%  03/15/09    74
Foster Wheeler                         6.750%  11/15/05    61
Goodyear Tire                          7.000%  03/15/28    72
Gulf Mobile Ohio                       5.000%  12/01/56    61
Hanover Compress                       4.750%  03/15/08    72
Hasbro Inc.                            6.600%  07/15/28    70
Health Management Associates Inc.      0.250%  08/16/20    69
Health Management Associates Inc.      0.250%  08/16/20    69
Human Genome                           3.750%  03/15/07    67
Human Genome                           3.750%  03/15/07    67
Huntsman Polymer                      11.750%  12/01/04    67
ICN Pharmaceuticals Inc.               6.500%  07/15/08    61
IMC Global Inc.                        7.300%  01/15/28    75
IMC Global Inc.                        7.375%  08/01/18    73
Ikon Office                            6.750%  12/01/25    67
Ikon Office                            7.300%  11/01/27    71
Inhale Therapeutic Systems Inc.        3.500%  10/17/07    49
Inhale Therapeutic Systems Inc.        3.500%  10/17/07    48
Inhale Therapeutic Systems Inc.        5.000%  02/08/07    55
Inland Steel Co.                       7.900%  01/15/07    58
Juniper Networks                       4.750%  03/15/07    67
Kmart Corporation                      9.375%  02/01/06    33
Kulicke & Soffa Industries Inc.        5.250%  08/15/06    62
LTX Corporation                        4.250%  08/15/06    71
Lehman Brothers Holding                8.000%  11/13/03    70
Level 3 Communications                 6.000%  09/15/09    36
Level 3 Communications                 6.000%  03/15/09    34
Level 3 Communications                 9.125%  05/01/08    61
Liberty Media                          3.500%  01/15/31    64
Liberty Media                          3.500%  01/15/31    64
Liberty Media                          3.750%  02/15/30    46
Liberty Media                          4.000%  11/15/29    46
Lucent Technologies                    5.500%  11/15/08    61
Lucent Technologies                    6.450%  03/15/29    46
Lucent Technologies                    6.500%  01/15/28    40
Lucent Technologies                    7.250%  07/15/06    64
Magellan Health                        9.000%  02/15/08    41
Medarex Inc.                           4.500%  07/01/06    70
Mediacom Communications                5.250%  07/01/06    67
Mediacom LLC                           7.875%  02/15/11    66
Mediacom LLC                           9.500%  01/15/13    70
Metris Companies                      10.125%  07/15/06    65
Mirant Corp.                           5.750%  07/15/07    62
Mirant Americas                        8.500%  10/01/21    66
Missouri Pacific Railroad              4.750%  01/01/20    67
Missouri Pacific Railroad              4.750%  01/01/30    62
Missouri Pacific Railroad              5.000%  01/01/45    58
Motorola Inc.                          5.220%  10/01/21    56
Motorola Inc.                          6.500%  11/15/28    74
MSX International                     11.375%  01/15/08    70
NTL Communications                     7.000%  12/15/08    16
Nextel Communications                  4.750%  07/01/07    69
Nextel Communications                  5.250%  01/15/10    53
Nextel Communications                  6.000%  06/01/11    57
Nextel Communications                  9.375%  11/15/09    54
Nextel Communications                  9.500%  02/01/09    53
Nextel Communications                 12.000%  11/01/11    74
Nextel Partners                       11.000%  03/15/10    59
Noram Energy                           6.000%  03/15/12    58
Northern Pacific Railway               3.000%  01/01/47    46
Northern Pacific Railway               3.000%  01/01/47    46
OSI Pharmaceuticals                    4.000%  02/01/09    75
PG&E National Energy                  10.375%  05/16/11    74
Pegasus Satellite                     12.375%  08/01/06    49
Primedia Inc.                          7.625%  04/01/08    71
Primedia Inc.                          8.875%  05/15/11    69
Public Service Electric & Gas          5.000%  07/01/37    70
Photronics Inc.                        4.750%  12/15/06    69
Quanta Services                        4.000%  07/01/07    48
Qwest Capital                          7.625%  08/03/21    64
Qwest Capital                          7.750%  02/15/31    61
RF Micro Devices                       3.750%  08/15/05    74
Rite Aid Corp.                         4.750%  12/01/06    66
Rite Aid Corp.                         7.125%  01/15/07    68
Rockwell Int'l                         5.200%  01/15/98    72
Royster-Clark                         10.250%  04/01/09    69
Rural Cellular                         9.625%  05/15/08    58
Ryder System Inc.                      5.000%  02/25/21    69
SBA Communications                    10.250%  02/01/09    57
SCI Systems Inc.                       3.000%  03/15/07    58
Sepracor Inc.                          5.750%  11/15/06    53
Sepracor Inc.                          7.000%  12/15/05    65
Silicon Graphics                       5.250%  09/01/04    54
Solutia Inc.                           7.375%  10/15/27    59
Sprint Capital Corp.                   6.875%  11/15/28    72
Time Warner Enterprises                8.375%  03/15/23    74
Time Warner Inc.                       6.625%  05/15/29    69
Time Warner Inc.                       6.950%  01/15/28    73
Time Warner Telecom                    9.750%  07/15/08    54
Tribune Company                        2.000%  05/15/29    63
Triton PCS Inc.                        8.750%  11/15/11    56
Triton PCS Inc.                        9.375%  02/01/11    61
Turner Broadcasting                    8.375%  07/01/13    74
US Airways                             6.820%  01/30/14    74
Ugly Duckling                         11.000%  04/15/07    60
United Air Lines                      10.670%  05/01/04    45
United Air Lines                      11.210%  05/01/14    37
Universal Health Services              0.426%  06/23/20    59
US Timberlands                         9.625%  11/15/07    61
US West Capital                        6.875%  07/15/28    67
United Air Lines                      10.670%  05/01/04    43
United Air Lines                      11.210%  05/01/14    45
Vesta Insurance Group                  8.750%  07/15/25    71
Viropharma Inc.                        6.000%  03/01/07    35
Weirton Steel                         10.750%  06/01/05    70
Weirton Steel                         11.375%  07/01/04    60
Westpoint Stevens                      7.875%  06/15/08    50
Williams Companies                     7.125%  09/01/11    64
Williams Companies                     8.125%  03/15/12    66
Williams Companies                     9.250%  03/15/04    33
Xerox Corp.                            0.570%  04/21/18    54
Xerox Credit                           7.125%  08/05/12    55
Xerox Credit                           7.200%  08/05/12    70


                          *********

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

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

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

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

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

                          *********

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

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

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

This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without
prior written permission of the publishers.  Information
contained herein is obtained from sources believed to be
reliable, but is not guaranteed.

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

                *** End of Transmission ***