TCR_Public/020829.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

            Thursday, August 29, 2002, Vol. 6, No. 171

                          Headlines

ADELPHIA BUSINESS: Court OKs Klee Tuchin as Committee's Counsel
ADELPHIA COMM: Has Until Dec. 26 to Make Lease-Related Decisions
ANC RENTAL: Obtains Approval of Cananwill Insurance Financing
AT&T CANADA: Petitions Cabinet to Modify CRTC Price Cap Ruling
BARCLO FINANCE: Fitch Downgrades Class D Notes to B- from B+

BIRCH TELECOM: Creditors' Meeting to Convene on Sept. 5, 2002
BIRCH TELECOM: Disclosure Statement Hearing Set for September 18
BRILL MEDIA: Regent Wins Approval to Acquire 12 Radio Stations
BUDGET GROUP: Obtains Relief to Settle Injury & Damage Claims
BURLINGTON: Seeks Approval to Hire Raz Realty as Condo Broker

CALPINE: Closes $106M Project Financing For Blue Spruce Center
CALPINE CORP: Initial Public Offering of New Income Fund Priced
CAPITOL COMMUNITIES: Dev't Unit Wants Chapter 11 Case Dismissed
CARIBBEAN PETROLEUM: Court Fixes October 10 Claims Bar Date
CHARMING SHOPPES: Files $150 Mill. Shelf Registration Statement

COMMUNICATE.COM: Must Raise New Capital to Meet Liquidity Needs
CONTOUR ENERGY: Seeks Approval to Hire H.J. Gruy Professionals
CORAM HEALTHCARE: Trustee Wants More Time to Decide on Leases
COVANTA ENERGY: Enters Into Compromise with Dominion Virginia
CYBERCARE INC: Continues Nasdaq Listing Pending Hearing Results

DIXON TICONDEROGA: Taps Wachovia Securities to Evaluate Options
DOR BIOPHARMA: Regains Compliance with AMEX Listing Requirements
DYNAMIC INTERNATIONAL: Ability to Continue Operations Uncertain
ENRON: Committee's Probe Targets 47 Financial Institutions
EOTT ENERGY: Forbearance Agreement on Credit Facilities Extended

EVOLVING SYSTEMS: Commences Trading on Nasdaq SmallCap Market
EXIDE TECHNOLOGIES: Court Okays Jefferies as Committee's Advisor
FEDERAL-MOGUL: Selling Wagner Business to Decoma for Up to $8MM
GALEY & LORD: Turns to Rothschild-Italia for Financial Advice
GENTEK: Fitch Corrects Downgrade Report on Bank Facility Rating

GLOBAL CROSSING: Asks Court to Approve Settlement with Alcatel
HAYES LEMMERZ: Keeps Plan Filing Exclusivity through December 16
ICG COMMS: Seeking Open-Ended Lease Decision Period Extension
IMMULOGIC PHARMA.: Will Transfer All Assets to Liquidating Trust
INSPIRE INSURANCE: Inks $22.2 Asset Sale Pact with CGI Group

INTEGRATED HEALTH: Sungard Seeks Payment of $1.18MM Admin. Claim
KMART CORP: Wants Okay to Enter into AFCO Financing Pact
LAIDLAW INC: Nov. 30, 2001 Balance Sheet Upside-Down by $1.06BB
LAIDLAW INC: Appoints Kevin E. Benson as New President and CEO
LORAL SPACE: Commences Exchange Offer for Preferred Shares

LTV CORP: Court Approves Hazelwood Works Sale to ALMONO LP
MALAN REALTY: Cohen Fin'l Completes Fund-Raising Transaction
METALS USA: Summary & Overview of Proposed Reorganization Plan
MTI TECHNOLOGY: Working Capital Deficit Tops $1.1M at July 6
NATIONAL GYPSUM: ACMC Case Summary & 40 Largest Unsec. Creditors

NATIONAL STEEL: Bondholders Block Illinois Power Compromise
NCS HEALTHCARE: Omnicare Responds to Statements on Tender Offer
NESTOR INC: Needs to Seek New Financing to Continue Operations
NORTEL NETWORKS: Takes Action to Lower Breakeven Cost Structure
POLAROID: Unsecured Creditors to be Paid with Purchaser's Shares

QUANTUM CORP: S&P Puts BB Corp. Credit Rating on Watch Negative
QWEST COMMS: Weak Operations Spur S&P to Ratchet Rating to B-
RELIANCE INSURANCE: Liquidator Sells Brazilian Unit for $3.5MM
ROCKWELL MEDICAL: Auditors Express Going Concern Doubt
TEMPLETON EMERGING: Shareholders Approve Plan of Liquidation

TEXFI: Trustee Hires Silverman Perlstein as Avoidance Counsel
TRAVEL SERVICES: Court Sets Sept. 3 Deadline for Admin. Claims
TRI UNION DEVELOPMENT: Auditors Raise Going Concern Doubt
UNIROYAL TECHNOLOGY: Court Grants Access to $15MM DIP Financing
US AIRWAYS: Intends to Honor Prepetition Maintenance Claims

US AIRWAYS: Reneges on Tentative Pact Between Allegheny & Pilots
US AIRWAYS: Implements New Set of Policies to Ensure Low Fares
VALENTIS INC: Fails to Comply with Nasdaq Listing Requirements
WEIRTON STEEL: Expresses Concern About 2002 Import Projections
WEIRTON STEEL: Says ITC Ruling Weakens Ability to Rebuild Sector

WHEELING-PITTSBURGH: Sells 84K Shares in Prudential Financial
WICKES INC: S&P Junks Credit Rating, Citing Marginal Liquidity
WORLDCOM INC: Signing-Up Smith Pachter as Special Counsel
W.R. GRACE: Fitch Withdraws Senior Debt & Comm'l Paper Ratings
XO COMMS: Committee Wins Nod to Hire Jefferies as Fin'l Advisors

XO COMMS: Carl Icahn's Tender Offer for Sr. Secured Debt Expires

* DebtTraders' Real-Time Bond Pricing

                          *********

ADELPHIA BUSINESS: Court OKs Klee Tuchin as Committee's Counsel
---------------------------------------------------------------
The Official Committee of Unsecured Creditors, in the chapter 11
cases involving Adelphia Business Solutions, Inc., and its
debtor-affiliates, obtained permission from the Court to retain
Klee Tuchin Bogdanoff & Stern LLP as special conflicts counsel,
nunc pro tunc to July 11, 2002.

Klee Tuchin professionals will be compensated on an hourly basis
and reimbursed for actual, necessary expenses incurred.  The
current standard hourly rates of the firm's professionals are:

       Partners                     $350 - 675
       Associates                    225 - 305
       Paralegals/Law Clerks         135 - 150

As special conflicts counsel to the Committee, Klee Tuchin's
responsibilities will include:

A. investigation and potential pursuit of one or more claims
   against Salomon Smith Barney Inc.;

B. representing the Committee in matters where Kasowitz Benson
   Torres & Friedman LLP has a conflict of interest or is unable
   to represent the Committee; and

C. other matters in which the Committee determines. (Adelphia
   Bankruptcy News, Issue No. 15; Bankruptcy Creditors' Service,
   Inc., 609/392-0900)


ADELPHIA COMM: Has Until Dec. 26 to Make Lease-Related Decisions
----------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
has extended Adelphia Communications and its debtor-affiliates'
lease decision period.  The ACOM Debtors now have until
December 26, 2002, to decide whether to assume, assume and
assign, or reject their unexpired nonresidential real property
leases.

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


ANC RENTAL: Obtains Approval of Cananwill Insurance Financing
-------------------------------------------------------------
ANC Rental Corporation, and its debtor-affiliates sought and
obtained the Court's authority to enter into a Premium Financing
Agreement with Cananwill Inc.  The Court also granted Cananwill
security interest in unearned or returned premiums and other
amounts due to the Debtors under the underlying property
insurance policies that are financed under the Financing
Agreement.

The insurance coverage is necessary to fully insure the Debtors'
assets and business operations, for the benefit and protection
of the Debtors' creditors.

Mark J. Packel, Esq., at Blank Rome Comisky & McCauley LLP,
in Wilmington, Delaware, informs the Court that the Financing
Agreement provides for $250,000,000 of property insurance
coverage, the first $100,000,000 of which provides earthquake
coverage from July 1, 2002 through June 30, 2003.  The premium
to be paid by the Debtors in connection with this agreement is
$9,192,089.  This consists of a $2,291,985 downpayment, with the
remaining $6,900,104 to be financed over nine months at an
annual percentage rate of 4.48%.  The Debtors' monthly payment
is pegged at $781,061.

Under the agreement, in the event of the Debtors' default in
payment, the automatic stay provisions of Section 362 of the
Bankruptcy Code will be immediately lifted.  Cananwill, after
providing the Debtors with sufficient notice, will have the
right to cancel the underlying policies.  Cananwill would also
be entitled to apply any unearned or return premiums due under
the Policies to any amount owing by the Debtors to Cananwill
without further Court application.  If after cancellation of the
Policies the unearned or returned premiums are insufficient to
pay the Debtors' total amount due to Cananwill under the Finance
Agreement, any remaining amount owing to Cananwill, including
reasonable attorneys' fees, will be granted an administrative
expense claim against the Debtors and entitled to priority
pursuant to Section 503 of the Bankruptcy Code.

Mr. Packel relates that the Debtors have investigated the
possibility of obtaining similar financing from alternative
sources but have determined that other financing arrangements
would be on less advantageous terms than the financing
arrangement provided by Cananwill. (ANC Rental Bankruptcy News,
Issue No. 18; Bankruptcy Creditors' Service, Inc., 609/392-0900)


AT&T CANADA: Petitions Cabinet to Modify CRTC Price Cap Ruling
--------------------------------------------------------------
AT&T Canada Inc. (TSX: TEL.B and NASDAQ: ATTC), filed its appeal
of the Canadian Radio-television and Telecommunications
Commission's May 30, 2002 Price Cap Decision. In filing its
appeal, the company has petitioned the Governor in Council to
endorse the proposition that the competitors to the former
monopoly telephone companies must have "competitively neutral"
access to the former monopoly network in order to sustain the
choice and benefits of competition in telecommunications to
Canadians and Canadian businesses and to direct the CRTC to take
specific steps to put that proposition into effect.

AT&T Canada makes clear in its petition to the Cabinet that
unless the CRTC decision is modified, it is doubtful whether a
significant competitive alternative to the incumbent telephone
companies will prosper. AT&T Canada emphasized that the CRTC
decision, as it stands, is completely inconsistent with the pro-
competitive telecommunications policy goals that the federal
government has pursued since 1993; goals that Canadians heartily
support.

Despite having invested billions of dollars in its own network,
AT&T Canada and other competitors still require access to the
former monopoly networks to complete customer connections and
will continue to do so for at least the duration of the next
Price Cap regime.

The petition notes, among other things, "the costs incurred by
competitors to access the incumbent network are as Minister John
Manley put it 'a barrier to entry.' In fact, the costs to access
network facilities and services represent 55% of AT&T Canada's
direct costs. Thus, AT&T Canada must pay 55% of its direct costs
or over $400 million annually, to the former monopolies it is
trying to compete against. This is a cost the incumbent does not
incur and is a source of revenue and margin for the incumbent."

AT&T Canada is prepared to pay "competitively neutral" costs for
network access which it regards as a fundamental necessity for
real competition to prosper.

John McLennan, Vice Chairman and CEO, said, "We believe it is
extremely important that the government take this action to
redress the existing inequities in the regulatory framework,
which has been reinforced by the CRTC's May decision. By
insisting on only "facilities-based competition," the CRTC has
strayed from the letter and intent of the 1993 Canadian
Telecommunications Act and propelled the industry back toward
re-monopolization.

"The past few years have demonstrated, and the government has
supported, the fact that a full and fair competitive
telecommunications marketplace is in the best interests of
Canadian businesses and the public to ensure that customers
receive increased choice, innovation and competitive pricing.
However, in its May decision, the CRTC has refused to recognize
that competitors must have competitively neutral access to the
existing telecommunications network."

AT&T Canada and other competitors have urged the CRTC, for the
past two years, to move towards full and fair competition by
opening up access to the former monopoly network on a
competitively neutral basis. However the May 30, 2002 decision,
in its disregard for full and fair competition, in favor of a
purely facilities-based form of competition, will only ensure
the increasing dominance and profitability of the former
monopolies with their existing, ubiquitous networks.

The CRTC's Price Cap framework has obliged competitors to
subsidize the already highly profitable former monopolies by
paying far more to them to access the existing network than
their actual costs. According to the CRTC's own recent decisions
on a few specific issues regarding access, competitors have over
paid the former monopolies by at least $850 million over the
past few years.

Eleven competitive providers have failed in the 18 months prior
to the May decision and only a handful of any significance
remain. While the economic environment of our industry has been
difficult for all new entrants, as the industry stabilizes, it
is important that the regulatory environment provide an
opportunity for the remaining competitors to prosper.

McLennan continued, "The trend that is glaringly obvious is that
telecommunications in Canada is very close to being re-
monopolized. We have never asked the regulator to solve our
business problems and AT&T Canada is making strong progress in
restructuring our capital structure and our business plan to
establish the company as a strong and growing competitor for the
long term. However the current regulatory environment hinders
us, and other competitors, from maximizing the full potential of
our business opportunity as expeditiously as we could in a full
and fair competitive environment.

The Cabinet has a clear role to play in ensuring that the
Canadian telecom environment is structured to support full and
fair competition by ensuring a competitive cost neutral
environment for all parties."

AT&T Canada also stated that it is encouraged and pleased that
the CRTC is addressing one specific aspect of the recent Price
Cap decision, but continues to believe that a review of the
decision must be expanded.

AT&T Canada is the country's largest competitor to the incumbent
telecom companies. With over 18,700 route kilometers of local
and long haul broadband fiber optic network, world class managed
service offerings in data, Internet, voice and IT Services, AT&T
Canada provides a full range of integrated communications
products and services to help Canadian businesses communicate
locally, nationally and globally. AT&T Canada Inc. is a public
company with its stock traded on the Toronto Stock Exchange
under the symbol TEL.B and on the NASDAQ National Market System
under the symbol ATTC. Visit AT&T Canada's Web site,
http://www.attcanada.comfor more information about the company.

As previously reported, AT&T Canada's June 30, 2002 balance
sheet shows a total shareholders' equity deficit of about $3
million.

AT&T Canada Inc.'s 10.75% bonds due 2007 (ATTC07CAR1),
DebtTraders says, are trading at 11 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=ATTC07CAR1
for real-time bond pricing.


BARCLO FINANCE: Fitch Downgrades Class D Notes to B- from B+
------------------------------------------------------------
Fitch Ratings downgrades the class D notes of BarCLO Finance
(1999) Ltd. The collateralized loan obligation, is a synthetic
CLO established by Barclays Capital Inc. to provide credit
protection on a $2 billion portfolio of investment grade bank
loans.

Fitch downgraded $20,000,000 of BarCLO's class D notes to 'B-'
from 'B+'.

Fitch's rating action reflects higher than expected defaults in
the underlying reference portfolio. Fitch will continue to
monitor this transaction.


BIRCH TELECOM: Creditors' Meeting to Convene on Sept. 5, 2002
-------------------------------------------------------------
On July 29, 2002, Birch Telecom, Inc., together with its debtor-
affiliates, filed for Chapter 11 protection in the U.S.
Bankruptcy Court for the District of Delaware.

The United States Trustee will convene a meeting of creditors on
September 5, 2002 at 10 a.m., prevailing Eastern Time to be held
at the J. Caleb Boggs Federal Building, 2nd Floor, Room 2112,
844 King St., Wilmington, Delaware.  This is the first meeting
of creditors as required pursuant to Section 341 of the
Bankruptcy Code.

The Debtors' representative must appear at the section 341
meeting of the creditors on the date and at the place set forth
for the purpose of being examined under oath by the United
States Trustee and creditors about the Debtors' financial
affairs and operations. Attendance by creditors at the meeting
is welcomed but not required. The meeting may be continued or
adjourned without further written notice.

Birch Telecom, serving small to mid-size businesses and
residential customers, offers a range of services on one bill --
including local and long-distance -- across more than 40 major
metro markets in 10 states.  Michael G. Busenkell, Esq., at
Morris, Nichols, Arsht & Tunnell represents the Debtors in their
restructuring efforts.  When the Debtors filed for protection
from its creditors, Birch Telecom, Inc., the lead debtor, listed
estimated assets of $1 to $10 million and estimated debts of
more than $100 million.


BIRCH TELECOM: Disclosure Statement Hearing Set for September 18
----------------------------------------------------------------
When Birch Telecom, Inc., and its debtor-affiliates, filed for
chapter 11 protection, the Debtors delivered their Disclosure
Statement and Prepackaged Joint Plan of Reorganization to the
U.S. Bankruptcy Court for the District of Delaware.

A combined hearing to approve the adequacy of the Disclosure
Statement, the solicitation procedures used to gather creditors'
votes, and to confirm the Plan will commence on September 18,
2002 at 10:30 a.m. prevailing Eastern Time, or as soon
thereafter as counsel can be heard, before the Honorable
John C. Akard.

Any objections to the adequacy of the Disclosure Statement or to
confirmation of the Plan must be received by the Clerk of the
Delaware Bankruptcy Court before 4:00 p.m., prevailing Eastern
Time, on September 11, 2002.  Copies must also be served on:

      (i) Martin N. Flics, Esq.
          Gregg D. Josephson, Esq.
          Latham & Watkins
          885 Third Avenue
          Suite 1000
          New York, New York 10022-4802
          Fax: (212) 751-4864

     (ii) William H. Sudell Jr., Esq.
          Morris, Nichols, Arsht & Tunnel
          1201 North Market Street
          Wilmington, Delaware 19801
          Fax: (302) 658-3989

    (iii) Office of the United States Trustee
          844 King Street, Suite 2313
          Lockbox 35
          Wilmington, Delaware 19801-3519
          Attn: Mark S. Kenney, Esq.
          Fax: (302) 573-6497

Birch Telecom, serving small to mid-size businesses and
residential customers, offers a range of services on one bill --
including local and long-distance -- across more than 40 major
metro markets in 10 states.  Michael G. Busenkell, Esq., at
Morris, Nichols, Arsht & Tunnell represents the Debtors in their
restructuring efforts.  When the Debtors filed for protection
from its creditors, Birch Telecom, Inc., the lead debtor, listed
estimated assets of $1 to $10 million and estimated debts of
more than $100 million.


BRILL MEDIA: Regent Wins Approval to Acquire 12 Radio Stations
--------------------------------------------------------------
Regent Communications, Inc., (Nasdaq:RGCI) received final
approval from the bankruptcy court to acquire 12 radio stations
from Brill Media Company LLC and related debtor entities, in
connection with Brill Media's federal bankruptcy proceeding.

Regent's acquisition is subject to receipt of all required
regulatory approvals. Regent anticipates closing this
transaction late in the fourth quarter of 2002 or the first
quarter of 2003.

As previously announced, Regent will pay approximately $62
million for the assets. Up to one half of the acquisition price
is expected to be paid in Regent common stock, subject to
Regent's option of substituting cash for the stock portion of
the transaction, in whole or in part, if the market price of
Regent's common stock is less than $7.50 per share within the
applicable time period preceding the closing date. The non-stock
portion of the purchase price will be paid entirely in cash, and
in no event will be less than $31.0 million.

Regent anticipates that it will begin operating the stations
pursuant to a local marketing agreement by mid-September 2002.
Given the anticipated timing of the operational takeover, the
acquisition will not have a material effect on the Company's
third quarter results. As a result, Regent is not adjusting its
financial guidance at this time.

Terry Jacobs, Chairman and Chief Executive Officer, commented,
"This acquisition provides us with an excellent opportunity to
drive strong revenue and cash flow growth over the long-term.
Over the next six months our focus will be on integrating these
stations into our portfolio. Specifically, we anticipate
reducing the commercial load on a number of properties to more
practical levels, as well as turning our construction permit in
Colorado into a live station. As a result, we would expect
significant margin improvements in these stations beginning in
the second half of next year, as the benefits of Regent's long-
term operational focus take hold. However, even with these
investments, we still expect these stations to contribute
incremental cash flow to our fourth quarter results."

"We also believe we are entering these markets on solid
financial terms," Mr. Jacobs continued. "In fact, adjusting for
stick value, this transaction was done at an attractive multiple
of approximately 13 times 2002 broadcast cash flow. In addition,
even with this acquisition we will maintain one of the strongest
balance sheets in the industry, providing us with the
flexibility to do further acquisitions which enhance our long-
term growth potential."

Regent is acquiring WIOV-FM and WIOV-AM serving Lancaster-
Reading, PA; WBKR-FM, WKDQ-FM and WOMI-AM serving the
Evansville, IN and Owensboro, KY markets; KTRR-FM and KUAD-FM
and a construction permit for an FM station serving Fort
Collins-Greeley, CO; and KKCB-FM, KLDJ-FM, KBMX-FM and WEBC-AM
serving Duluth, MN.

Regent Communications is a radio broadcasting company focused on
acquiring, developing and operating radio stations in middle and
small-sized markets. Upon the close of all announced
transactions, Regent will own and operate 73 stations located in
17 markets. Regent Communications, Inc., shares are traded on
the Nasdaq under the symbol "RGCI."


BUDGET GROUP: Obtains Relief to Settle Injury & Damage Claims
-------------------------------------------------------------
Budget Group Inc., and its debtor-affiliates and certain of
their non-debtor subsidiaries are confronted with 7,000 personal
injury and property damage claims pending throughout the United
States and 1,225 personal injury and property damage claims
pending outside the United States.  These claims arise from:

A. Vehicle accidents in which the Debtors' renters or other
   authorized drivers, who generally also are named as
   defendants, were the drivers, and

B. In a few instances, from vehicle accidents in which
   renters/drivers of vehicles rented by entities formerly owned
   by the Debtors were involved in accidents and for which
   accidents the Debtors have some liability exposure.

Most or all of the claims include as defendants, rental
customers/drivers, non-debtor subsidiaries and other non-debtor
entities for whom the Debtors are primarily liable or obligated
to defend, adjust and resolve claims for.

Robert S. Brady, Esq., at Young Conaway Stargatt & Taylor LLP,
in Wilmington, Delaware, informs the Court that 5,000 of the
claims related to the Debtors' U.S. operations are being handled
by the Debtors' self-administered liability department.  The
Debtors' insurance carriers handles all of the 1,225 claims
outside the U.S., while Claims America Inc. handles the 2,000
Claims relating to the Debtors' truck rentals as Third-Party
Administrator on behalf of the Debtors.  As of the Petition
Date, the Debtors owe $1,800,000 to various claimants for
prepetition claims that arose from the rental of the Debtors'
vehicles, which claims were settled or otherwise resolved prior
to the Petition Date.

By this motion, the Debtors seek the Court's authority:

  * to continue to defend and adjust, in the ordinary course of
    business, the Claims arising from the rental of Debtors'
    vehicles and to fulfill their obligations to AIG and other
    insurance carriers with respect to the AIG claims and non-
    U.S. claims;

  * to establish a uniform program to:

    a. manage the costs of defending the Claims, including,
       without limitation, the costs of attorneys' fees and
       claims and defense and loss adjustment expenses;

    b. allow the Debtors to continue to snake the statutorily
       required personal injury protection payments and payments
       relating to uninsured and wider-insured motorist
       coverage; and

    c. implement a range of settlement parameters that would
       permit settlement of the Claims and payment of the
       related settlement;

  * to fulfill all outstanding obligations relating to
    prepetition settlements or resolutions of claims that arose
    from the rental of the Debtors' vehicles; and

  * to pay in the ordinary course any amounts owing to the
    Third-Party Administrator as of the Petition Date

As of the Petition Date, the lawsuits against the Debtors and
Third Parties are at various stages of litigation: some in
discovery, others in trial and many in settlement discussions.
If the Court does not grant the requested relief, the Debtors
would be unable to defend the claims and pay costs related to
the claims.  In this situation, states may de-certify the
Debtors or revoke their vehicle registrations, and corporate
clients may divert their businesses elsewhere.  TFFC's
bankruptcy-remote status, on the other hand, may be jeopardized.
Certain states have vicarious liability statutes pursuant to
which the owner of a vehicle has absolute vicarious liability
for the damages and injuries caused by anyone driving the
owner's vehicle.  In those states, since the Debtors have
contractually indemnified TFFC and in many cases, its renters
and drivers, the Debtors will be liable, without defense, if the
renter and driver or the non-debtor subsidiary is found liable.
The Debtors' market position could be eroded.

The Debtors' proposed omnibus procedure for managing the costs
of the claims include:

A. The Debtors may continue to pay the First Party Coverage
   Costs and the Defense Costs without further notice or
   approval of the Court.  The Debtors will provide a quarterly
   report of the payment of all these costs to the Court, the
   United States Trustee and the Notice Parties;

B. The Debtors, in their sole discretion, may settle individual
   Claims without further notice and without further approval of
   the Court if the settlements are within these parameters:

   * the face amount of the settlement of any individual Claim
     is not more than $50,000;

   * the face amount of the settlement of any individual Claim
     is between $50,001 and $100,000, provided the settlement is
     not more than 80% of the amount reserved on the Debtors'
     books and records with respect to the Claim at the time of
     settlement; and

   * the face amount of the settlement of any individual Claim
     is between $101,000 and $300,000, provided the settlement
     amount is not more than 60% of the amount reserved;

C. If the Debtors settle an individual Claim in which the face
   amount of the settlement is between $50,001 and $300,000 but
   the settlement amount exceeds the percentage of Reserves set
   forth in subparagraphs, or if the settlement amount exceeds
   $300,000, in either event, the Debtors shall provide notice
   of the proposed settlement to the Notice Parties and the
   United State Trustee, each of whom shall have 15 days from
   the date the notice was sent in which to notify the Debtors
   of an objection to the proposed settlement.  If the Debtors
   are advised of an objection, the Debtors will file a motion
   seeking approval of the settlement with the Court providing
   appropriate notice only to the settling party, the United
   States Trustee, the Notice Parties and any party requesting
   notice in these cases;

D. The Debtors will provide a quarterly settlement report,
   including a Cost Report, of all settlements to the Court, the
   U.S. Trustee and the Notice Parties;

E. The Debtors may only settle Claims and pay the Costs,
   provided that the total quarterly payments of the Settlement
   Amounts, the Defense Costs and the First Party Coverage Costs
   do not, in the aggregate, exceed $18,000,000 per quarter.  If
   the Quarterly Cap is not reached in any given quarter, the
   unused portion will carry over to each succeeding quarter;
   and

F. The Notice Parties are:

   * counsel for any statutory committee formed in the Debtors'
     cases;

   * counsel to the prepetition secured lenders; and

   * counsel to the postpetition secured lenders.

                            *   *   *

Subject to the entry of a final order, Judge Walrath grants the
relief requested on an interim basis. (Budget Group Bankruptcy
News, Issue No. 2; Bankruptcy Creditors' Service, Inc., 609/392-
0900)


BURLINGTON: Seeks Approval to Hire Raz Realty as Condo Broker
-------------------------------------------------------------
Burlington Industries, Inc., and its debtor-affiliates intend to
dispose three residential condominium units located at Units
30B, 30D and 30H at Tower 53 Condominiums, 159 West 53rd Street
in New York.

Burlington Industries Inc. wants to employ Raz Realty in the
ordinary course of business, effective as of July 1, 2002, as
real estate agent and broker for the condominium units.

Paul N. Heath, Esq., at Richards, Layton & Finger, in
Wilmington, Delaware, emphasizes that Burlington requires a
knowledgeable and experience real estate agent and broker to
market the New York Condos.  Accordingly, Burlington believes
that Raz can maximize the Condos' value for the benefit of
Burlington's estates.  Raz has more than 11 years of experience
working in residential real estate in the New York area.  The
firm has completed numerous residential sales of value similar
to the New York Condos.

In connection with its efforts to sell the New York Condos, Mr.
Heath relates that Burlington entered into exclusive letter
agreements with Raz on July 1, 2002.  Under the Letter
Agreements, Raz is granted the exclusive right to show the New
York Condos to its clients.  Raz alone can solicit bids for the
purchase of the Condos within a 120-day period.  If, after 120
days, Raz is unsuccessful in its efforts to sell the New York
Condos, Burlington will be free to allow other real estate
agents to show the New York Condos to their customers.

Raz Realty owner Raphael Zeevi relates that his firm will:

      (i) advertise the New York Condos through promotional and
          marketing activities;

     (ii) distribute a standard brokerage flyer; and

    (iii) contact potential purchasers or lessors of the New
          York Condos regarding the potential sale.

For its services, Mr. Heath says, Raz is entitled to a broker's
fee in the event that its customer is the ultimate purchaser of
any of the Condos.  In the case of the sale of Unit 30D to James
G. Robertson and Kathleen J. Robertson, which are Raz customers,
the firm is entitled to a $22,175 Broker's Fee, which represents
5% of the gross consideration for Unit 30D.  Raz can collect the
sum upon the closing of the Unit 30D Sale.

Mr. Heath argues that the ordinary course retention of Raz is
warranted because, as provided under the Ordinary Course
Professionals Order:

(a) Raz has no material involvement in the administration of the
    Debtors' estates.  Raz's involvement in these Chapter 11
    cases is its services with respect to the New York Condos,
    which are non-core assets;

(b) Raz's Broker Fee is well within the four-month average cap
    which do not exceed $50,000; and

(c) Raz will not receive any payments until it has filed an
    affidavit with the Court, pursuant to Section 327(e) of the
    Bankruptcy Code.

According to Mr. Zeevi, Raz does not represent or hold any
interest adverse to the Debtors or their estates with respect to
matters on which it is to be employed.  In addition, Raz has not
been and is not currently employed by any parties-in-interest in
matters related or unrelated to these Chapter 11 cases.

If the Court is not inclined to approve Raz' retention under the
Ordinary Course Professionals Order, Burlington suggests that
the Court permit Raz's retention in accordance with Section
327(a) of the Bankruptcy Code.

                      U.S. Trustee Objects

On behalf of the United States Trustee, Maria D. Giannirakis,
Esq., in Wilmington, Delaware, asserts that RAZ is a
professional as contemplated by Section 327 of the Bankruptcy
Code and Third Circuit Law.  Accordingly, Raz's employment must
be conducted in compliance with the requirements of Section 327
and Federal Rule of Bankruptcy Procedure 2014.

Ms. Giannirakis also complains that the Debtors' Application
seeks to employ RAZ nunc pro tunc without establishing
extraordinary circumstances to justify the approval.

The United States Trustee leaves the Debtors to their burden and
reserves all discovery rights. (Burlington Bankruptcy News,
Issue No. 17; Bankruptcy Creditors' Service, Inc., 609/392-0900)


CALPINE: Closes $106M Project Financing For Blue Spruce Center
--------------------------------------------------------------
Calpine Corporation (NYSE: CPN) has completed a $106-million
non-recourse project financing for the construction of its 300-
megawatt Blue Spruce Energy Center.  Calpine will sell the full
output of the natural gas-fired peaking facility to Public
Service Co. of Colorado (Public Service) under the terms of
a ten-year tolling agreement.

A group of banks led by Credit Lyonnaise provided project
financing for the $150-million peaking facility, under a six-
year, non-recourse construction and term-loan facility.

"Credit Lyonnaise's financial commitment to Calpine further
demonstrates that modern energy centers, like the Blue Spruce
Energy Center, will continue to be the workhorses of the power
industry," stated Bob Kelly, Calpine CFO.

"This competitively priced financing will help ensure Calpine
delivers clean, reliable and low-cost electricity to help meet
Public Service's peak demand."

The project, currently under construction, is located in an
industrial area east of Denver in Aurora, and will interconnect
with Public Service's existing transmission lines, with access
to nearby natural gas pipelines serving the region.

Calpine expects to begin energy deliveries in May 2003 to help
Public Service meet its peak summer load and to ensure system
reliability.  Under the ten-year tolling agreement, Public
Service will have dispatch rights for all of the capacity and
energy produced by the facility and also will manage the
purchase and delivery of fuel used at the facility.  Output from
the facility will be added directly to Public Service's grid
when power is needed the most.

Based in San Jose, Calif., Calpine Corporation is an independent
power company that is dedicated to providing customers with
clean, efficient, natural gas-fired power generation.  It
generates and markets power through plants it develops, owns and
operates in 23 states in the United States, three provinces in
Canada and in the United Kingdom.  Calpine also is the world's
largest producer of renewable geothermal energy, and it owns 1.2
trillion cubic feet equivalent of proved natural gas reserves in
Canada and the United States.  The company was founded in 1984
and is publicly traded on the New York Stock Exchange under the
symbol CPN.  For more information about Calpine, visit its Web
site at http://www.calpine.com

Calpine's balance sheet showed a working capital deficit of
about $582 million on March 31, 2002.

Calpine Corp.'s 8.75% bonds due 2007 (CPN07USN1) are trading at
about 60, DebtTraders says. For real-time bond pricing, see
http://www.debttraders.com/price.cfm?dt_sec_ticker=CPN07USN1


CALPINE CORP: Initial Public Offering of New Income Fund Priced
---------------------------------------------------------------
Calpine Corporation (NYSE: CPN), a leading North American power
producer, has priced the initial public offering of its newly
established Canadian income trust fund -- the Calpine Power
Income Fund.

The Calpine Power Income Fund, with a market valuation of
approximately C$520 million, will indirectly own a 70% interest
in Calpine Power L.P., through Class A Priority Units, with
Calpine owning the remaining interest in the form of Class B
Subordinated Units.  Calpine Power L.P., holds interests in
Calpine's three Canadian power-generating assets, representing a
combined power generating capacity of approximately 550 net
megawatts.

Under this initial offering, Calpine Power Income Fund will
issue to the public 23 million of the approximately 52 million
total Trust Units outstanding for gross proceeds of C$230
million.  Calpine will retain the remaining Trust Units for
potential future sale.  To cover over-allotments, Calpine has
granted its underwriters an option to purchase up to 3.45
million Trust Units for a period expiring 30 days following the
closing of the offering.  The Trust Units were priced at C$10.00
per unit, to initially yield 9.35% per annum.

A final prospectus was filed with securities commissions in
Canada. The offering is expected to close on August 29, 2002,
with the first cash distribution expected to be paid on or about
October 20, 2002 to unitholders of record as of September 30,
2002.  The Calpine Power Income Fund will make monthly cash
distributions to its unitholders.

Standard & Poor's has assigned its second-highest Canadian
stability rating of "SR-2" to the Trust Units, with a stable
outlook.  The Toronto Stock Exchange has conditionally approved
the listing of the Trust Units, subject to the fulfillment of
customary conditions.  The Trust Units will trade under the
symbol CF.UN.

The Calpine Power Income Fund power-generating assets include
the 225-megawatt Island Cogeneration Facility located in British
Columbia, near Campbell River and the 300-megawatt combined-
cycle Calgary Energy Centre, currently under construction in
Calgary, Alberta.  The Calpine Power Income Fund also will make
a loan to a Calpine subsidiary, which indirectly holds a half-
interest in the 50-megawatt Whitby Cogeneration Facility,
located in Whitby, Ontario.

The offering was jointly led by Scotia Capital Inc., and CIBC
World Markets Inc., on behalf of a syndicate of underwriters
that includes National Bank Financial Inc., TD Securities Inc.,
Canaccord Capital Corporation, HSBC Securities (Canada) Inc.,
and Dundee Securities Corporation.

The securities offered have not been registered under the U.S.
Securities Act of 1933, as amended, and may not be offered or
sold in the United States absent registration or an applicable
exemption from the registration requirements.

Based in San Jose, Calif., Calpine Corporation is an independent
power company that is dedicated to providing customers with
clean, efficient, natural gas-fired power generation.  It
generates and markets power through plants it develops, owns and
operates in 23 states in the United States, three provinces in
Canada and in the United Kingdom.  Calpine also is the world's
largest producer of renewable geothermal energy, and it owns
1.2 trillion cubic feet equivalent of proved natural gas
reserves in Canada and the United States.  The company was
founded in 1984 and is publicly traded on the New York Stock
Exchange under the symbol CPN.  For more information about
Calpine, visit its Web site at http://www.calpine.com

Calpine's balance sheet showed a working capital deficit of
about $582 million on March 31, 2002.


CAPITOL COMMUNITIES: Dev't Unit Wants Chapter 11 Case Dismissed
---------------------------------------------------------------
Capitol Communities Corporation (OTC Bulletin Board: CPCY)
announced its wholly owned subsidiary, Capitol Development of
Arkansas, Inc., has filed a motion to dismiss its petition for
relief under Chapter 11 of the United States Bankruptcy Code.
The Company has paid its secured creditors in lieu of a plan of
reorganization.

The petition was originally filed in the United States
Bankruptcy Court for the Eastern District of Arkansas, Little
Rock Division on July 21, 2000. It was filed when a planned sale
of 1,000 acres of land it then owned in Maumelle, Arkansas fell
through and a secured creditor sought to foreclose on the land.
The US Bankruptcy Court has permitted Capitol Development to
operate as debtor in possession for the duration of the filing.
This year the Company completed land sales totaling
approximately $8.5 million and has paid off all of its secured
creditors.

Capitol Communities Corporation, through its subsidiary,
currently owns approximately 700 acres of land in the master
planned community of Maumelle, Arkansas.  Maumelle is a planned
city with about 12,000 residents located directly across the
Arkansas River from Little Rock.  Maumelle contains a full
complement of residential, industrial and commercial
development.


CARIBBEAN PETROLEUM: Court Fixes October 10 Claims Bar Date
-----------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware orders
that creditors of Caribbean Petroleum LP and its debtor-
affiliates' must file their proofs of claim or be forever barred
from asserting that claim.  The Court rules that any person
wishing to assert a claim against the Debtors' estates has until
October 10, 2002 to file a claim, and it must be received by:

          Poorman-Douglas Corporation
          Caribbean Petroleum LP, et al. Claims Processing
          PO Box 4390
          Portland, OR 97208-4390

Proofs of claim will be deemed timely-filed only if they are
received by the Claims Agent on or before 4:00 p.m. (prevailing
Pacific Time).

Five types of claims are excluded from the Bar Date:

     i) claims previously filed properly with the Court;

    ii) claims not listed as "disputed," "contingent," or
        "unliquidated" in the Debtors' Schedules;

   iii) claims previously allowed by order of the Court.

     iv) claims allowable as an expense of administration; and

      v) common stock or other equity interest claims.

Rejection damage claims arising from the Debtors' repudiation of
an executory contract or unexpired lease, must be filed before
the earlier of:

     i) the bar date established by the Court authorizing the
        rejection of such contract or lease, or

    ii) 45 days following the confirmation date of the Plan

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


CHARMING SHOPPES: Files $150 Mill. Shelf Registration Statement
---------------------------------------------------------------
Charming Shoppes, Inc. (Nasdaq: CHRS), the retail apparel chain
specializing in women's plus-size apparel, announced that a
shelf registration statement on Form S-3 registering for resale
its 4.75% Senior Convertible Notes due 2012 (and the shares of
common stock of Charming Shoppes issuable upon the conversion of
the Notes) was filed Monday with the Securities and Exchange
Commission.

As previously announced, the Notes were issued in a private
placement in May 2002.  Charming Shoppes will not receive any of
the proceeds from any resale of the Notes that may be made under
the registration statement.  This news release does not
constitute an offer to sell or the solicitation of an offer to
buy the securities.

As of August 3, 2002, Charming Shoppes, Inc., operated 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).

                              *    *    *

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


COMMUNICATE.COM: Must Raise New Capital to Meet Liquidity Needs
---------------------------------------------------------------
Troyden Corporation was incorporated October 10, 1995 under the
laws of the State of Nevada and, effective August 24, 2000,
changed its name from Troyden Corporation to Communicate.com
Inc.  Effective November 10, 2000 the Company acquired a 52%
controlling interest in Communicate.com Inc., an Alberta private
company and, during December 2000, acquired from minority
shareholders an additional 31% of the outstanding shares of
AlbertaCo.  After acquiring a further 10% of the outstanding
shares of AlbertaCo from minority shareholders in the second
quarter of 2002, CMNN owns 93% of the outstanding shares of
AlbertaCo.  On April 5, 2002 AlbertaCo changed its name to
Domain Holdings Inc.

AlbertaCo owns a portfolio of simple, intuitive domain names.
AlbertaCo's current business strategy is to seek partners to
develop its domain names to include content, commerce and
community applications. AlbertaCo has also entered into
agreements to sell or lease certain of its domain names.

The Company's consolidated financial statements have been
prepared on the basis of a going concern, which contemplates the
realization of assets and satisfaction of liabilities in the
normal course of business. At June 30, 2002 the Company has a
working capital deficiency of $767,632 (down from $1,222,706 at
June 30, 2001) and has incurred losses since inception raising
substantial doubt as to the Company's ability to continue as a
going concern.  The Company's continued operations are dependent
on its ability to obtain additional financing, settling its
outstanding debts and to maintain profitable operations.

In the second quarter of 2002, Communicate.com Inc., recorded
income from the utilization of its domain names (consisting
primarily of the lease of domain names, commissions on the sales
of products where its domain names are utilized, and fees
received from third parties calculated on the number of Internet
users who visit sites identified with its domain names and gain
or loss from domain name sales) of $31,300, a decrease of
approximately 56% from the second quarter of 2001. The decrease
resulted primarily from a loss recognized by the Company of
$81,200 on the sale of a health-related domain name to a third
party. Excluding the loss on sale of the domain name, revenue
for the second quarter would be $112,500, an increase of 58%
from the second quarter of 2001. Communicate.com recognized
approximately $44,700 from arrangements entered into with an
internet pay-per-click service provider, which will pay the
Company a fee for successful click-through traffic, in which
users navigating to a site associated with a domain name owned
by the Company are redirected to a site which sells goods and
services associated with the domain name. Communicate.com
recorded approximately $16,400 in income from pay-per-click
agreements from various different service providers in the
second quarter of 2001. Its sales reflect commission generating
arrangements with several of its health-related domains whereby
the Company earns a portion of any revenue generated from
customers introduced by the Company's domain names which
generated $17,000 during the second quarter of 2002 compared to
$18,000 in the second quarter of 2001. These agreements are
arranged on a month-to-month basis and there can be no assurance
that they will be renewed or, if renewed, that they will
continue to generate income on the same basis as in past
periods. In addition, Communicate.com also received the second
annual installment of approximately $33,000 from the leasing of
a geographic domain name and recognized deferred revenue to
generate $15,000 from the leasing of a sports domain name in the
second quarter of 2002. The operator of the leased sports domain
name has notified the Company that he will not exercise his
option to purchase the domain name and will not continue to
operate the site beyond September 13, 2002. Management will seek
other business opportunity for this and other domain names not
in use.

Management will continue to market selectively individual domain
names from its portfolio of domain names in fiscal 2002 and
identify potential purchasers who have substantial liquid assets
to complete any contemplated purchase transactions. Because of
the fluid nature of Internet-based businesses, Communicate.com
will require potential purchasers to advance funds as deposits
to better assure the consummation of these transactions.
Management believes that its portfolio of generic product or
services category domain names will continue to generate
interest from potential partners or purchasers despite a
softened and depressed domain names aftersales market because of
the intuitive and traffic-generating characteristics of its
domain names.

In the second quarter of 2002, Communicate.com generated other
revenue from a bad debt recovery of $7,300, and other
miscellaneous income of $4,700. Any cashflow generated, net of
monthly cash operating expenses, has been applied to reduce
debt. Management anticipates continuing this debt management
program for the foreseeable future.

At June 30, 2002 Communicate.com had current liabilities in
excess of current assets resulting in a working capital deficit
of $767,600.  During the six-month ended June 30, 2002 the
Company had a net income of $74,400 and an increase in cash of
$31,600, compared to a net loss of $183,300 and a decrease in
cash of $9,500 for the same six-month period of last year.
Operating activities generated cashflows of $308,700 primarily
from the sale of two domain names, from net income generated
during the quarter and after payments to trade creditors.  The
cashflows were used to repay a $150,000 loan, other loans and to
pay lease obligations. The Company has accumulated a deficit of
$593,500 since inception and has a stockholders' equity of
$2,305,700 at June 30, 2002.  Due to the working capital
deficit, there is substantial doubt about its ability to
continue as a going concern.  The Company will only be able to
continue operations if it raises additional funds, either
through operations or outside funding and cannot predict whether
it will be able to do so.

Communicate.com and the Subsidiary cannot satisfy its cash
requirements for the next 12 months without having to raise
additional funds. The Subsidiary's expected cash requirement for
the next 12 months is $200,000. The Company expects to raise any
additional funds by way of equity and/or debt financing, and
through the sale of non-strategic domain name assets.  However,
it not be able to raise the required funds from such financings,
particularly in light of existing market conditions and the
perception by investors of those companies that, like
Communicate.com, engage in e-commerce and related businesses. In
that case the Company will proceed by approaching current
shareholders for loans or equity capital to cover operating
costs.

Although these actions are expected to cover anticipated cash
needs for working capital and capital expenditures for at least
the next twelve months, no assurance can be given that
Communicate.com will be able to raise sufficient cash to meet
these cash requirements.


CONTOUR ENERGY: Seeks Approval to Hire H.J. Gruy Professionals
--------------------------------------------------------------
Contour Energy Co., and its debtor-affiliates ask for permission
from the U.S. Bankruptcy Court for the Southern District of
Texas to engage H.J. Gruy and Associates, Inc., as their
independent petroleum engineers, effective July 22, 2002.  The
Debtors tell the Court that because they are primarily an
exploration and production company, they require the continued
services of independent petroleum engineers during the pendency
of their chapter 11 cases.

H.J. Gruy offers a broad range of services to all levels of the
oil and gas business ranging from simple advice to sophisticated
technical analysis based upon the most updated technology.  H.J.
Gruy's professionals in Houston, Texas have provided services to
the Debtors.  As a result, the firm obtained an extensive
knowledge of the Debtors' properties and oil and gas reserves,
and the related issues facing the Debtors.

The professional services that H.J. Gruy will render include:

     a) petroleum reservoir engineering;

     b) geological and geophysical services; and

     c) year-end and interim reserves reporting for Securities
        and Exchange Commission valuation filings.

The Debtors will pay H.J. Gruy the Firm's customary hourly
rates:

          Senior Staff                        $150 - $250
          Junior Staff/Contract Employees     $100 - $210
          Technical Support Staff             $ 30 - $50

Contour Energy Co., a company engaged in the exploration,
development acquisition and production of oil and natural gas
primarily in south and north Louisiana, the Gulf of Mexico and
South Texas, filed for chapter 11 protection on July 15, 2002.
John F. Higgins, IV, Esq., at Porter & Hedges, LLP in Houston,
represents the Debtors in their restructuring efforts.  When the
Company filed for protection from its creditors, it listed
$153,634,032 in assets and $272,097,004 in debts.


CORAM HEALTHCARE: Trustee Wants More Time to Decide on Leases
-------------------------------------------------------------
Arlin M. Adams, the Chapter 11 Trustee of the bankruptcy estates
of Coram Healthcare Corp., wants more time to assume or reject
unexpired non-residential real property leases.  The Trustee
tells the U.S. Bankruptcy Court for the District of Delaware
that he needs until December 31, 2002 to make reasoned decisions
about whether to assume, assume and assign or reject Coram's
Unexpired Leases.

The Trustee tells the Court he requires additional time to
review both the opportunities to reorganize the Debtors' Estates
and the future of the Debtors' businesses.  Until that analysis
is done, it's impossible to fairly assess the Unexpired Leases'
benefits and burdens.

Mr. Adams believes the Unexpired Leases are important Estate
assets.  But, in light of the Trustee's recent March 2002
appointment, he has not had sufficient time to intelligently
appraise the value of each Unexpired Lease.  The Trustee
believes that an extension through year-end will facilitate
ongoing reorganization efforts and will minimize administrative
expenses, thereby benefiting the estate, creditors, and other
parties in interest.

Coram Healthcare, a provider of home infusion-therapy services
filed for Chapter 11 bankruptcy protection on August 8, 2000.
Goldman Sachs and Cerberus Partners each own about 30% of the
firm. Kenneth E. Aaron, Esq., at Weir & Partners LLP and Barry
E. Bressler, Esq., at Schnader Harrison Segal & Lewis LLP
represent the Chapter 11 Trustee in these proceedings.


COVANTA ENERGY: Enters Into Compromise with Dominion Virginia
-------------------------------------------------------------
Covanta Energy Corporation and its debtor-affiliates ask the
Court to:

    -- approve a compromise between Covanta Fairfax and Dominion
       Virginia Power, and

    -- lift the automatic stay to permit the set-off of mutual
       prepetition obligations owed by Dominion Virginia Power
       and Covanta Alexandria to each other.

                        Covanta Fairfax

Vincent E. Lazar, Esq., at Jenner & Block LLC, in Chicago,
Illinois, relates that Covanta Fairfax is the owner and operator
of a waste-to-energy facility located in Fairfax County,
Virginia.  Pursuant to a First Amendment and Restatement of
Power Purchase and Operating Agreement with Virginia Electric
and Power Company dated December 1, 1996 -- Fairfax PPA --
Covanta Fairfax agreed to sell and Dominion Virginia Power
agreed to purchase, electrical energy and capacity produced by
the Fairfax Facility. The County of Fairfax, Virginia and the
Fairfax County Solid Waste Authority are express third party
beneficiaries under the Fairfax PPA.

On February 3, 1994, the Virginia State Corporation Commission
issued the Order in which it held that gross receipt taxes
included in capacity payments made to certain power generators
would be disallowed from capacity payments passed through to the
ratepayers of Dominion Virginia Power retroactive to October 27,
1992.  Thus, Dominion contends that it may reduce the capacity
payments made to Covanta Fairfax under the Fairfax PPA to
reflect the Disallowance Order and that it may recover past
costs related to the gross receipts taxes and prior capacity
payments retroactive to October 27, 1992.  Mr. Lazar tells Judge
Blackshear that Covanta Fairfax disputes this claim.

Mr. Lazar explains that under the Fairfax PPA, Covanta Fairfax
and Dominion had agreed, inter alia, to defer until May 2002 the
payment of any amounts owed by Covanta Fairfax to Dominion as a
result of the Disallowance Order.  After which, Dominion is
entitled to deduct up to 75% of the amount owed to Covanta
Fairfax for capacity each month until all amounts owed to
Dominion by virtue of the Disallowance Order had been paid.

As of the Petition Date, Mr. Lazar says, Dominion owed Covanta
Fairfax $1,963,665 for energy and capacity sold by Covanta
Fairfax to Dominion during March 2002.  In the same manner,
Covanta Fairfax owed Dominion $25,031 for utility services
provided to Covanta Fairfax during March 2002.  The parties do
not dispute these amounts.

Mr. Lazar relates that Dominion is further asserting a right of
set-off $3,000,000 due under the Disallowance Order.  Covanta
Fairfax disputes this assertion.

Pursuant to Covanta Fairfax's agreements with the County and the
Authority, the County is effectively the third party beneficiary
of an amount equal to 88% of the amounts paid by Dominion to
Covanta Fairfax for energy and capacity.  Therefore, Mr. Lazar
contends, the County is the real party-in-interest with respect
to the majority of Dominion's asserted right of set-off.

To settle the disputes concerning the gross receipt taxes and
the effect of the Disallowance Order, Covanta Fairfax, Dominion,
the County and the Authority entered into a Settlement Agreement
wherein Dominion is granted a $1,600,000 prepetition claim, to
be set-of against the net prepetition amount owed by Dominion to
Covanta Fairfax.  Mr. Lazar reports that only $190,000 of the
settlement amount will ultimately affect Covanta Fairfax because
the County is entitled to the benefit of 88% of the proceeds.

Without this settlement, Mr. Lazar argues, the only option
available is to commence litigation with Dominion.  However, Mr.
Lazar points out, a litigation would be protracted, expensive,
wasteful and ultimately distracting to the Debtors and their
professionals in their efforts to reorganize their businesses.
Moreover, while the Debtors believe they might prevail in the
litigation, the outcome is still unpredictable.  Accordingly,
Mr. Lazar insists that the settlement is reasonable, fair and in
the best interest of the Debtors' assets and should be approved.

                       Covanta Alexandria

Covanta Alexandria is the owner and operator of a waste-to-
energy facility located in Alexandria, Virginia.  As of the
Petition Date, Dominion owed Covanta Alexandria $583,851 for
energy and capacity sold by Covanta Alexandria to Dominion
during March 2002.  Covanta Alexandria, on the other hand, owed
Dominion $185,046 for utility services provided to Covanta
Alexandria during March 2002.  The amounts owed by the
respective parties are not in dispute.

Accordingly, Mr. Lazar states, the Debtors consent to a set-off
by Dominion.  Right after, Dominion will remit the balance of
$398,804 to Covanta Alexandria upon Court approval of the set-
off. (Covanta Bankruptcy News, Issue No. 12; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


CYBERCARE INC: Continues Nasdaq Listing Pending Hearing Results
---------------------------------------------------------------
CyberCare, Inc. (Nasdaq:CYBR), announced that it had been
notified by the Nasdaq Stock Market, Inc., that its common stock
will be delisted from the Nasdaq Stock Market, effective with
the open of business on August 28, 2002. The Company has
submitted an appeal of such decision and such hearing will stay
the delisting pending a hearing.

As of August 19, 2002, the Company has not regained compliance
in accordance with the Marketplace Rule 4310(C)(8)(D), and is
not eligible for an additional 180 calendar grace period given
that it does not meet the initial inclusion requirements of The
Nasdaq SmallCap Market under Marketplace Rule 4310(C)(2)(A).
Specifically, the Company does not comply with the stockholders
equity/market value of listed securities/net income from
continuing operations inclusion requirement set forth in
Marketplace Rule 4310(C)(2)(B).

Nasdaq records indicate that the Company has not yet paid its
Nasdaq SmallCap Market pro-rata Annual Fee in the amount of
$3,479.17, which was due on July 12, 2002 and Listing of
Additional Shares fees totaling $39,836.14, which were due as of
December 4, 2001 and May 10 and June 17, 2002, respectively, in
accordance with Marketplace Rule 4500 Series.

Lastly, Nasdaq notified the Company that it did not comply with
the independent director and audit committee requirements for
continued inclusion set forth in Marketplace Rules 4350(C) and
4350(d)(2), respectively.

If a favorable result is achieved from the appeal, the Company
hopes to continue its SmallCap listing. If not, the Company's
common stock will trade on the over-the-counter market.

CyberCare, Inc., is a holding company, which is primarily
composed of a services business comprising both a physical
therapy and rehabilitation business and a pharmacy business, and
a healthcare technology solutions business. Our overall goal is
to improve the delivery and quality of healthcare for patients
while adding incremental value to our customers' clinical and
business processes. Our physical therapy and rehabilitation
business operates clinics throughout the State of Florida. Its
caring staff of clinicians and therapists compliment traditional
primary care, orthopedic and neurological physician services and
serves a wide range of patients requiring physical and
occupational therapy and other rehabilitation services. Our
pharmacy business supports thousands of patients and residents
in assisted living and other long-term care facilities located
in Florida. It also is licensed for mail order distribution
across all fifty states.

Our healthcare technology business utilizes its intellectual
property, including patented technology, to deliver tele-health
solutions addressing the entire continuum of care. Its
Electronic HouseCall(R) (EHC(TM)) hardware and software
technology focuses on the chronically ill, wellness management,
compliance and wound care. The EHC(TM) family of products and
services permit enhanced physician supervision and oversight and
enable remote medical and wellness monitoring and real-time
interactive communications between patients and caregivers. This
is made possible through various monitoring devices, hardware
and software applications and our ability to establish an
interactive network across the health care continuum and among a
community of users and providers. In combination with our
customers' clinical and business processes, the Electronic
HouseCall(R) system allows for effective and efficient data
collection, integration and security, while successfully
supporting case management and promoting personal participation
and interaction. CyberCare, Inc., is headquartered in Boynton
Beach, Florida. Visit its Web site at http://www.cybercare.net


DIXON TICONDEROGA: Taps Wachovia Securities to Evaluate Options
---------------------------------------------------------------
Dixon Ticonderoga's revenues for the quarter ended June 30,
2002, increased $206,000 from the same quarter last year.  U.S.
Consumer revenue volume increases in the retail and educational
channel were partially offset by lower prices offered to enhance
inventory reduction efforts.  Foreign Consumer was slightly
lower overall as higher volume was more than offset by the
effects of  devaluation of the Mexican peso (approximating
$280,000) and Mexico price reductions in response to competitive
pricing pressure.

Revenues for the nine months ended June 30, 2002, increased
$866,000 from the same period last year.  The U.S. Consumer
revenue decrease was primarily in the educational market as
distributor  consolidations led to reduced purchases in an
effort to lower their inventory levels.  Foreign Consumer
revenue increased primarily in Mexico primarily due to increased
sales to existing mass  market customers and additional
government business.

Operating income in the quarter ended June 30, 2002 decreased
$790,000 from the same quarter last year.  Overall gross profit
margins remained stable, as this decrease was predominantly due
to higher selling and administrative costs, partially offset by
lower restructuring costs. U.S. administrative costs for the
prior year quarter and nine months ended June 30, 2001,
reflected a reduction of approximately $600,000 for legal
recoveries from a settlement with certain insurance companies.
In addition, the current year period reflects higher U.S.
selling costs associated with increased sales  in the retail
mass market and higher bank financing charges.   These factors
were primarily responsible for an increase in selling and
administrative costs (28.0% of sales as compared to 23.7% of
sales in the prior year quarter).  Restructuring costs decreased
$294,000 from the prior year, when Mexico consolidated its
operations into a new facility.

Operating income for the nine months ended June 30, 2002
decreased $937,000.  As discussed above,  overall gross profit
margins were comparable and the reduction in operating income
was due to the factors contributing to higher selling and
administrative costs (32.6% of sales as compared to 30.6% of
sales in the prior year period), partially offset by lower
restructuring costs in the period.

The Company's primary financing arrangements are with a
consortium of lenders, initially providing a total of up to
$42.5 million in financing through September 2004. The financing
agreements, as amended, include a revolving line of credit
facility in the amount of $30 million, which bears interest at
either the prime rate plus 1.15%, or the  prevailing LIBOR rate
plus 2.65%, through September 2004. The agreements also provide
for the payment of various bank fees approximating $14,000 per
month.  Borrowings under the revolving credit facility are based
upon eligible accounts  receivable and inventories of the
Company's U.S. and Canada operations, subject to reserves for
anticipated subordinated debt payments and certain other items,
as defined in the loan  documents.  The loan and security
agreements also include a term loan in the initial amount of
$7.5 million. The term loan is payable in monthly installments
of $125,000, plus interest, through September 2004. The loan
bears interest based upon the same prevailing rate described
above in connection with the  revolving credit facility.

Dixon Ticonderoga executed an interest rate swap agreement that
effectively fixed the rate of interest on $8 million of these
borrowings at 8.98% through August 2005.   The Company entered
into the  interest rate swap agreement to balance and manage
overall interest rate exposure and minimize  overall cost of
borrowings.

These financing arrangements are collateralized by the tangible
and intangible assets of the U.S., and Canada operations
(including accounts receivable, inventories, property, plant and
equipment, patents and trademarks) and a pledge of the capital
stock of the Company's subsidiaries.  The loan and security
agreement contains provisions pertaining to the maintenance of
certain financial ratios and annual capital expenditure levels,
as well as restrictions as to payment of cash dividends.  As of
June 30, 2002, the Company had approximately $15 million
outstanding under the revolving credit facility.  In addition,
the Company's Mexico subsidiary currently has approximately $14
million in bank lines of credit ($3 million unused at June 30,
2002) expiring at various dates that bear  interest at a rate
based upon either a floating U.S. bank rate or the rate of
certain Mexican government securities.  The Company is awaiting
approval on at least $3 million of additional Mexico lines of
credit and is presently reviewing other debt proposals for its
Mexico subsidiary.  The Company's Mexico subsidiary cannot
assure that its lines of credit will continue to be available
after their respective expiration dates, or that additional
lines of credit will be secured.  The Company relies heavily on
the availability of the lines of credit in the U.S. and Mexico
for liquidity in its operations.

The Company also has outstanding $16.5 million of 12% Senior
Subordinated Notes valued at their face amount, due September
2003. The subordinated note agreement provides for an interest
rate of 13.5%  through June 2002 and 12.25% through maturity in
2003. The note agreement, as amended, contains  provisions that
limit dividends and other payments, and requires the maintenance
of certain financial covenants and ratios.

In September 2001, a waiver of compliance with one provision of
the Company's existing primary lending agreement expired and its
senior lenders prohibited the payment of $5.5 million in
principal due to senior subordinated noteholders on September
26, 2001. The subordinated notes payment due date was extended
by the noteholders on various dates since (most recently through
August 19, 2002) to allow the Company more time to address its
debt issues to the mutual satisfaction of all parties involved.

The Company says it is close to reaching terms with a new senior
lender and its existing subordinated lenders to refinance and
restructure its present U.S. debt through 2005.  The new lender
has  preliminarily agreed to provide a three-year $28 million
senior debt facility which would replace the  Company's existing
senior debt with a consortium of lenders.  The new senior debt
arrangement would provide $5 million in increased working
capital liquidity that would be available for operations and to
make certain subordinated debt payments.

The senior debt facility would include a $25 million revolving
loan, which would bear interest at either the prime rate, plus
0.75%, or the  prevailing LIBOR rate, plus 3.5%. The agreement
would also provide for a closing fee of 1% of the maximum credit
line and a fee of 0.25% on the first and second anniversary of
the loan; a monthly maintenance fee of $5,000; and certain
additional transactional  fees.  Borrowings under the revolving
loan would be based upon 85% of eligible U.S. and Canada
accounts receivable, as defined; 50% of certain accounts
receivable having extended payment terms;  and varying advance
rates for U.S. and Canada raw materials and finished goods
inventories. The facility would include term loans aggregating
$3 million, which would bear interest at either the prime rate,
plus 1.5%, or the prevailing LIBOR rate, plus 4.5%. These loans
are expected to be payable in monthly installments of $50,000,
plus interest.  The loan agreement would also contain
restrictions regarding subordinated debt payments, a requirement
to maintain a minimum level of  operating cash flow and net
worth and a limitation on the amount of annual capital
expenditures.

The Company also reached tentative agreement with the holders of
$16.5 million of Senior Subordinated  Notes to restructure the
notes, extending the maturity date to 2005. The Company would
pay  approximately $6.5 million to its subordinated lenders over
the next three years, at which time the balance of approximately
$10 million would be due.  Payments to the subordinated lenders
would be subject to certain restrictions imposed under the
pending senior debt facility.  At the time of the expected
closing of the new senior debt facility described above, the
Company would pay all  subordinated debt accrued interest
(approximately  $1.9  million) and $1 million in principal.
Interest on the balance of subordinated debt would be paid
quarterly thereafter.  If the Company would be unable to make
any portion of the remaining $5.5 million by 2005 (due to
restrictions imposed  under the new senior debt facility or
otherwise) the noteholders would receive warrants equivalent to
approximately 2.27% of the diluted common shares outstanding for
each $1 million in unpaid principal, in addition to warrants
(expiring in September 2003) now held by them. Any warrants
received or earned would be relinquished if the notes were to be
paid in full during the term of the new agreement.  The
agreement would also grant the subordinated lenders a lien on
Company assets (junior in all aspects to the new senior debt
lender).  The interest rate on the subordinated notes has been
13.5% through June 30, 2002 (12% payable in cash and 1.5% PIK)
plus an additional 2% on the past due amount of $5.5  million.
At closing, the interest rate on the notes would change to 12.5%
(without PIK) through maturity in 2005.  The new subordinated
note agreement would include certain other provisions, including
the elimination or adjustment of financial covenants contained
in the original agreement.

The closing of the  restructuring of the Company's senior and
subordinated debt is subject to the lenders completing an
intercreditor agreement and to final negotiation and
documentation. All parties are working toward a closing by
September 2002.  Although the Company believes that the debt
restructuring will be consummated on substantially the terms
described above, there can be no assurance that that will be the
case.

During its debt negotiations, the Company has improved its cash
management processes and believes it has sufficient lines of
credit available under its present senior debt and other
agreements to fulfill all current and anticipated operating
requirements of its business until it closes its contemplated
new debt agreements. Moreover, the present senior lenders have
consistently supported the Company by continuing normal funding
under their agreements throughout the ongoing negotiations.  The
Company  expects to finalize the new borrowing arrangements
described above before the end of its current fiscal year.
However, the Company cannot assure that they will close on these
new  orrowing arrangements or that changes in the terms
described above will not be made prior to closing.  In light of
the circumstances regarding the Company's various existing loan
arrangements, the report of the Company's independent
accountants (with respect to its fiscal 2001 financial
statements) included an explanatory paragraph as to substantial
doubt about the Company's ability to continue as a going
concern.

The Company has retained Wachovia Securities (formerly First
Union Securities) and certain other [unidentified] outside
consultants to advise and assist it in evaluating certain
strategic alternatives, including capital restructuring, mergers
and acquisitions, and/or other measures designed to resolve the
Company's issues with its lenders while maximizing shareholder
value.


DOR BIOPHARMA: Regains Compliance with AMEX Listing Requirements
----------------------------------------------------------------
DOR BioPharma Inc., (Amex: DOR) has received notice from the
American Stock Exchange that AMEX considers DOR to have achieved
compliance with all of AMEX's continued listing requirements.
Further, the delisting process which began in May, 2002 is
deemed over and DOR will continue to trade on AMEX.

In May 2002, DOR received a notice from AMEX that DOR was
subject to a delisting procedure due to DOR's failure to
maintain adequate stockholders' equity as required by AMEX's
continued listing standards.  In July, DOR submitted a response
in which it demonstrated DOR's immediate achievement of all of
AMEX's continued listing requirements.  In its most recent
notice, AMEX accepted the DOR's response and stated that it
deems the delisting process to be over with no further action
required.

DOR stated, "recognizing the high importance to our stockholders
of maintaining our listing on AMEX, we are gratified with the
decision reached by AMEX and the timely successful outcome of
this procedure."

DOR BioPharma, Inc., is a specialty pharmaceutical company
specializing in the oral delivery of approved chemical entities
and oral non-live vaccines for the treatment of a variety of
disorders.  Its lead product, orBec(R) (oral beclomethasone
dipropionate), is currently in a pivotal, multi-center, phase
III clinical trial for the treatment of intestinal Graft-Vs.-
Host Disease (GVHD) and has been designated "Fast Track" status
by the FDA for this lead indication.  For further information
regarding DOR BioPharma, please visit the company's Web site
located at http://www.dorbiopharma.com


DYNAMIC INTERNATIONAL: Ability to Continue Operations Uncertain
---------------------------------------------------------------
Dynamic International, Inc., was formed on August 31, 2000, as a
wholly owned company of Dynamic International Ltd.  Pursuant to
an Equity Transfer and Reorganization Agreement dated August 10,
2000, between Ltd., certain of its shareholders, Emergent
Management Company, LLC, and several holders of membership
interests in Emergent Ventures, LLC (an affiliate of Emergent),
Ltd. transferred all of its assets to the Company.  In addition,
the Company assumed all of the liabilities of Ltd. (other than
outstanding bank debt in the amount of $250,000).  Immediately
following that transfer of assets and the assumption of
liabilities, Ltd. transferred to its shareholders, on a pro-rata
basis, all issued and outstanding shares of common stock of the
Company.

Dynamic International is engaged in the design and marketing of
sports bags and luggage, which are marketed primarily under the
licensed name JEEP(TM) and under its own name, Polaris
Expedition(TM).  In addition, it has been engaged in the design,
marketing and sale of a diverse line of hand exercise and light
exercise equipment, including hand grips, running weights, jump
ropes and aerobic steps and slides.  It marketed these products
under the licensed trademarks SPALDING(TM) and KATHY IRELAND(TM)
as well as under its own trademarked name SHAPE SHOP(TM).  Under
an agreement dated in June 2000, the Company sold its inventory
of exercise products, excluding the Spalding(TM) Rotaflex(TM),
and entered into an agreement not to sell any product that would
compete with the items sold for a period of five years.  The
Company's objective is to become a designer and marketer of
goods that are associated with a free-spirited lifestyle and
leisure time.

The Company's auditors, Israeloff, Trattner & Co, P.C., in
Garden City, New York, indicate in their report dated August 6,
2002, that there is substantial doubt regarding Dynamic's
ability to continue as a going concern as a result of its
significant net losses of approximately $696,000 and $1,238,000
for the fiscal years ended April 30, 2002 and April 30, 2001.
The Company generated approximately $1,379,000 of cash for the
fiscal year ended April 30, 2002.  In addition, as a result of
the terminated credit arrangement with Chase Manhattan Bank in
June of 2000, the Company will need to continue and possibly add
to its borrowing facility with an affiliate unless alternative
funding can be arranged.  These factors raise substantial doubt
about the Company's ability to continue as a going concern.

          Results of  Operations  for the Fiscal Year
                    Ended April 30, 2002

Sales for the fiscal year ended April 30, 2002,decreased by
$1,925,000, or 20.0%, to $7,601,000 from  $9,526,000 for the
fiscal year ended April 30, 2001.  Sales for the fiscal year
ended April 30, 2001  included the sale of the Company's
exercise products, under an agreement with Bollinger Industries,
L.P., for approximately $871,000. After excluding the sale to
Bollinger from the Company's sales for the fiscal year ended
April 30, 2001, the Company's sales for the fiscal year ended
April 30, 2002 decreased by $1,054,000, or 12.2%. During the
fiscal year ended April 30, 2002, sales to Kohl's  Department
Stores, Sears Roebuck and Office Depot Inc. decreased by
approximately $1,176,000, $677,000 and $241,000, respectively.
These decreases were offset by increased sales to Mervyn's (a
new customer) and BJ'S Wholesale Club of approximately $911,000
and $169,000, respectively. Allowances granted to customers were
9.6% of net sales for the fiscal year ended April 30, 2002
compared to 10.4% for the fiscal year ended April 30, 2001.
Allowances for the fiscal year ended April 30, 2001 included
approximately $224,000 in allowances granted to Bollinger for
the sale of the Company's exercise products which equaled
approximately 2.4% of the net sales. This was offset by
increases in allowances granted to Mervyn's of approximately
1.5% of net sales for the fiscal year ended April 30, 2002.

The Company's gross profit of $1,729,000 for the fiscal year
ended April 30, 2002 was $301,000 less than the gross profit of
$2,029,000 for the fiscal year ended April 30, 2001.

The gross profit percentage improved from 21.3% in fiscal 2001
to 22.74% in 2002.  Sales for the fiscal year ended April 30,
2001, included the sale of the Company's exercise products,
under an agreement with Bollinger Industries, L.P., for
approximately $871,000. The sale of the Company's hand held
exercise product line to Bollinger in June 2000 was at cost,
generating no gross margin. After excluding the sale to
Bollinger, the gross margin for the fiscal year ended April 30,
2001 was 23.3%.

The Company's pretax loss of $696,000 for the fiscal year ended
April 30, 2002 represents a $542,000  change from a pretax loss
of $1,238,000 for the fiscal year ended April 30, 2001. However,
as stated above, the Company has incurred losses of
approximately $696,000 and $1,238,000 during the years ended
April 30, 2002 and 2001, respectively. These factors raise
substantial doubt about the Company's ability to continue as a
going concern.


ENRON: Committee's Probe Targets 47 Financial Institutions
----------------------------------------------------------
The Official Committee of Unsecured Creditors appointed in the
chapter 11 cases involving Enron Corporation and its debtor-
affiliates, asks the U.S. Bankruptcy Court for the Southern
District of New York for an order under Rule 2004 of the Federal
Rules of Bankruptcy Procedure authorizing the issuance of
subpoenas for the production of documents and oral examination
of witnesses concerning the Debtors' transactions with various
financial institutions.

Stephen D. Lerner, Esq., at Squire, Sanders & Dempsey, in
Cincinnati, Ohio, relates that the Committee wants to issue
subpoenas to force production of documents and perpetuate oral
testimony from these 47 financial institutions:

     -- ABN AMRO Bank N.V.
     -- Allstate Insurance
     -- Bank of America
     -- BankBoston, Corp.
     -- Bank of New York
     -- Bankers Trust Company
     -- Barclays Bank, PLC
     -- Bear Stearns & Co., Inc.
     -- BNP Paribas
     -- Canadian Imperial Bank of Commerce
     -- The Chase Manhattan Bank
     -- Citibank N.A.
     -- Citigroup, Inc.
     -- Credit Lyonnais
     -- Credit Suisse First Boston (DLJ)
     -- Crescent/Mach I Partners, L.P.
     -- Deutsche Bank AG
     -- Deutsche Banc Alex Brown
     -- Deutsche Bank Securities, Inc.
     -- DLJ Investment Funding (or successor)
     -- DLJ ESC II LP (or successor)
     -- Dresdner Bank AG
     -- EN-BT Delaware, Inc.
     -- First Union National Bank
     -- Fleet Boston
     -- Fleet Bank, N.A.
     -- ING Baring (USA) Capital Markets
     -- John Hancock Life Insurance Company
     -- John L. Wortham & Sons, LLP
     -- J P Morgan Chase & Co.
     -- KBC Bank
     -- Lehman Brothers Inc.
     -- Merrill Lynch & Co.
     -- Merrill Lynch Pierce Fenner & Smith, Inc.
     -- Morgan Guaranty Trust Company
     -- National Westminster Bank plc
     -- Principal Life Insurance Companies
     -- Rabo Merchant Bank
     -- Royal Bank of Canada
     -- Royal Bank of Scotland, plc
     -- Scotia Capital (USA) Inc.
     -- Signature 1A (Cayman), Ltd.
     -- TCW Leveraged Income Trust LP
     -- UBS AG
     -- Wachovia Corp
     -- Watercress I LLC
     -- Westdeutsche Landesbank Girozentrale

Mr. Lerner explains that the documents concern:

    (i) the property of the Debtors;

   (ii) the liabilities and financial condition of the Debtors;

  (iii) matters that may affect the administration of the
        Debtors' estate; and

   (iv) the identification and prosecution of potential claims
        against third-parties by a representative of the
        Debtors' estates.

Mr. Lerner tells the Court that these financial institutions are
parties with the Debtors under various credit agreements and
loan transactions, prepaid commodities contracts, derivative
transactions, special purpose entity financings and other
investment banking and commercial banking agreements.  "Given
the scope and complexity of the Debtors' financial transactions,
the Committee expects to seek additional discovery," Mr. Lerner
adds. The Committee is authorized to investigate the acts,
conduct, assets, liabilities and financial condition of the
Debtors. Thus, a thorough and complete examination of the
Debtors' relationships and dealings with the Financial
Institutions is crucial to the Committee's investigation.

According to Mr. Lerner, the Committee wants to fully understand
the financial structure, legal and financial obligations,
valuation, and other critical information regarding the Debtors
and their related entities.  Additionally, the Committee seeks
the production of documents from the Financial Institutions in
connection with their continuing investigation of the Debtors'
related off-balance sheet entities.

In accordance with Bankruptcy Rule 2004(d), the Committee seeks
the Court's permission to provide the Financial Institutions
with 30 days' notice of the proposed oral examinations.  In
addition, the Committee seeks to compel production of the
documents requested within 20 days from the date of issuance of
subpoenas as authorized by an Order from this Court. (Enron
Bankruptcy News, Issue No. 40; Bankruptcy Creditors' Service,
Inc., 609/392-0900)

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


EOTT ENERGY: Forbearance Agreement on Credit Facilities Extended
----------------------------------------------------------------
EOTT Energy Partners, L.P., (NYSE: EOT) announced an extension
of the forbearance agreement on its credit facilities with
Standard Chartered Bank and its subsidiaries to October 30,
2002.  This extension agreement provides continued assurance to
EOTT's customers and suppliers of its ability to provide credit
support for its October and November crude oil marketing
activities.

Pursuant to the terms of the extension agreement, EOTT will
utilize its 30-day grace period with respect to its bond
interest payment due on October 1, 2002.  During this time, EOTT
intends to meet with its senior noteholders to negotiate
restructuring alternatives and continues active discussions with
Enron to resolve outstanding issues.  Although EOTT cannot
predict the outcome of discussions with senior noteholders or
Enron, this extension demonstrates the commitment of EOTT and
Standard Chartered Bank to maintain the value of EOTT's customer
and supplier relationships.

EOTT Energy Partners, L.P., is a major independent marketer and
transporter of crude oil in North America.  EOTT transports most
of the lease crude oil it purchases via pipeline that includes
8,000 miles of active intrastate and interstate pipeline and
gathering systems and a fleet of 260 owned or leased trucks.
EOTT Energy Corp., a wholly owned subsidiary of Enron Corp., is
the general partner of EOTT Energy Partners, L.P., with
headquarters in Houston. The Partnership's Common Units are
traded on the New York Stock Exchange under the ticker symbol
"EOT".

Eott Energy Partner's 11% bonds due 2009 (EOT09USR1) are trading
at 86 cents-on-the-dollar, DebtTraders reports. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=EOT09USR1for
real-time bond pricing.


EVOLVING SYSTEMS: Commences Trading on Nasdaq SmallCap Market
-------------------------------------------------------------
Evolving Systems, Inc. (Nasdaq: EVOL), a leading provider of
innovative operations and enhanced services software solutions
to blue chip clients in the communications industry, announced
that its common stock commenced trading on The Nasdaq SmallCap
Market, effective at the opening of the market on August 28,
2002.

Evolving Systems will retain the ticker symbol "EVOL".

The Company has been trading on The Nasdaq National Market, but
recently received notice from Nasdaq that it was not in
compliance with all of The Nasdaq National Market continued
listing requirements.

Evolving Systems will be given until November 25, 2002 to
demonstrate compliance with the Nasdaq SmallCap Market
requirements, specifically the requirement that the closing bid
price for the Company's common stock be at least $1.00 per share
for 10 consecutive trading days. If compliance with all of the
SmallCap Market listing requirements is not achieved by November
25, 2002, the Company may be granted an additional 180 calendar
days grace period to demonstrate compliance if certain
additional initial listing requirements are met, such as minimum
shareholder equity of $5,000,000.

If Evolving Systems has not met the minimum bid price
requirement at the expiration of all grace periods, its common
stock may be subject to delisting from the SmallCap Market, in
which case the Company may trade on the OTC Bulletin Board.

Evolving Systems, Inc., (Nasdaq: EVOL) provides innovative
operations and enhanced services software solutions to blue chip
clients in the communications industry. The company is the
nation's leading provider of local number portability solutions
and offers software products that enable carriers to comply with
the FCC's number conservation mandates intended to extend the
life of the North American Numbering Plan. The company's
enhanced services presence and availability management product
is poised to help revolutionize personal communications.
Evolving Systems' unique competence as both an operations
support system and enhanced services software product provider,
positions the company to accelerate the automation and
availability of tomorrow's enhanced services for today's tier
one carriers and application service providers. For additional
information visit http://www.evolving.com


EXIDE TECHNOLOGIES: Court Okays Jefferies as Committee's Advisor
----------------------------------------------------------------
Judge Akard approves the Official Unsecured Creditors'
Committee's retention of Jefferies as its financial advisors, in
the chapter 11 cases involving Exide Technologies, nunc pro tunc
to April 29, 2002, including the $150,000 monthly compensation,
Success Fee and reimbursement.  The indemnification provisions
are also approved subject to these conditions:

A. The Debtors are authorized to indemnify, and will indemnify
   Jefferies in accordance with the terms of the Jefferies
   engagement letter for any claim arising from, related to, or
   in connection with the Jefferies' engagement, but not for any
   claim arising from, related to, or in connection with
   Jefferies' postpetition performance of any services other
   than those in connection with the engagement, unless the
   postpetition services and indemnification are approved by the
   Court;

B. Notwithstanding any provision of the Jefferies Engagement
   Letter to the contrary, the Debtors will have no obligation
   to indemnify Jefferies, or provide contribution or
   reimbursement to Jefferies for any claim or expense that is
   either:

   1. judicially determined to have arisen solely from
      Jefferies' bad faith, gross negligence or willful
      misconduct; or

   2. settled prior to a judicial determination at to Jefferies'
      bad faith, gross negligence or willful misconduct, but
      determined by this Court, after notice and hearing, to be
      a claim or expense for which Jefferies is not entitled to
      receive indemnity, contribution or reimbursement under the
      terms of the Jefferies Engagement Letter;

C. If before the earlier of the:

   1. entry of an order confirming a Chapter 11 plan in these
      cases, and

   2. entry of an order closing these Chapter 11 cases,

   Jefferies believes that it is entitled to payment of any
   amounts by the Debtors on account of the Debtors'
   indemnification, contribution and reimbursement obligations
   under the Engagement Letter, including the advancement of
   defense costs, Jefferies must file an application therefore
   in the Court and the Debtors may not pay any amount to
   Jefferies before the entry of an order by the Court approving
   the payment;

D. The United States Trustee will have the right to object to
   the indemnification provisions approved herein if, during the
   Debtors' cases, the United States Court of Appeals for the
   Third Circuit issues a ruling with respect to the appeal from
   the decision of the United States District Court for the
   District of Delaware with respect to indemnification rights
   in re United Artists Theatre Company, et al., Case No. 00-
   3514 (SLR); provided that the United States Trustee will be
   required to file any objection within 120 days after the
   date the United States Court of Appeals for the Third Circuit
   issues a ruling; provided, further, that in the event of
   any objection, nothing herein will shift or otherwise
   alter the applicable burden of proof with respect to the
   indemnification provisions and, further provided, that if the
   United States Trustee appeals any decision to the United
   States Supreme Court, Jefferies agree to be bound by any
   decision of the United States Supreme Court on this issue.

                          *    *    *

Specifically, Jefferies is expected to:

A. become familiar, to the extent Jefferies and the Committee
   deem appropriate, with and analyze the business, operations,
   properties, financial condition and prospects of the Debtors;

B. advise the Committee on the current state of the
   "restructuring market";

C. assist and advise the Committee in developing a general
   strategy for accomplishing the Restructuring;

D. assist and advise the Committee in implementing a plan of
   Restructuring with the Debtors;

E. assist and advise the Committee in evaluating and analyzing a
   Restructuring including the value of the securities, if any,
   that may be issued to certain creditors under any
   Restructuring plan; and

F. render other financial advisory services as may from time
   to time be agreed upon by the Committee and Jefferies. (Exide
   Bankruptcy News, Issue No. 9; Bankruptcy Creditors' Service,
   Inc., 609/392-0900)


FEDERAL-MOGUL: Selling Wagner Business to Decoma for Up to $8MM
---------------------------------------------------------------
James E. O'Neill, Esq., at Pachulski, Stang, Ziehl, Young &
Jones, PC, in Wilmington, Delaware, relates that, in August
2000, Federal-Mogul Corporation and its debtor-affiliates'
management reviewed their strategy in investing various
businesses and technologies within the organization.  As a
result of this analysis, the Debtors determined that the
Lighting Group, a division of the Visibility Group, which
includes the wiper and lighting products businesses, was beyond
the core strategy and product focus of their overall business.

Subsequently, in March 2001, the Debtors sought the services of
Ernst & Young Corporate Finance LLC as an advisor in connection
with the divesture of the Lighting Group.  The divestiture will
either be in total or in a series of smaller transactions
involving individual business units or portions of the Lighting
Group.  The Debtors, with E&Y's assistance, prepared a
"Confidential Memorandum" to assist prospective buyers in
considering their interest in the Lighting Group.

By January 2002, the Debtors received an indication of interest
in the Wagner Original Equipment Lighting Products, a division
of the Lighting Group, from Decoma International Inc.  The
Wagner lighting business has 800 employees and produces
primarily forward lighting modules.  It is owned by Debtor
Federal-Mogul Ignition Company.  Decoma is a subsidiary of
Canadian auto parts supplier Magna International.

In order to draft an official proposal, Decoma requested
information from the Lighting Group management throughout a
period that extended from February to May 2002.  During this
period, Mr. O'Neill relates that members of Decoma's management
team visited various Wagner OE manufacturing facilities and met
with the management of each facility.  In early June 2002,
Decoma submitted a proposal for specific assets of the Wagner OE
business.  After a thorough review, the Debtors determined that
Decoma's proposal was superior to any other proposal that the
Debtors received.  Therefore, the Debtors elected to enter into
negotiations with Decoma for the sale of the Wagner OE business,
which resulted into a Letter of Intent dated August 7, 2002.

The salient terms under the Letter of Intent include:

Assets:  A. Wagner OE assets including personal property at the:

            1. manufacturing facilities in Hampton, Virginia and
               Matamoros, Mexico;

            2. distribution center in Brownsville, Texas; and

            3. assembly operation in Toledo, Ohio.

         B. all contract rights of Federal-Mogul Ignition
            related to the Wagner Assets;

         C. the Intellectual property rights, with the exception
            of trademark rights and trade names of Federal-Mogul
            related to the Wagner Assets; and

         D. applicable rights to machinery and equipment located
            at the facilities;

         The Debtors will retain all cash, accounts receivable,
         trademarks, intercompany accounts receivable, and
         certain other assets.

Buyer:   Decoma International Inc. or its affiliate

Price:   $5,000,000 to $8,000,000

         The amount is subject to a dollar-to-dollar adjustment
         based on the value of certain inventory at the date of
         the closing of the transaction.  The Buyer will also
         assume certain liabilities.  When including the
         estimated $10,000,000 in inventory and $13,000,000 in
         retained net assets, the Debtors value Decoma's offer
         at $28,000,000 to $31,000,000.

         The Debtors anticipate setting forth the sale of the
         Wagner OE assets to Decoma in a definitive sale
         agreement that will consummate the transaction
         contemplated by the Letter of Intent.

Payment: via a wire transfer at the Closing

Deposit: $200,000

         The Buyer agrees that, upon the execution of the
         Definitive Agreement, and provided the LOI is not
         terminated, it will deliver the refundable deposit to
         an interest bearing trust account.

By this motion, the Debtors seek the Court's authority to
consummate the sale of the Wagner Assets in accordance with the
terms of Decoma's letter of intent, subject to higher and better
offers.

       Equity Committee: Establish Definite Purchase Price

Ian Connor Bifferato, Esq., at Bifferato, Bifferato &
Gentilotti, in Wilmington, Delaware, informs the Court that the
Official Committee of Federal-Mogul's Equity Security Holders
Committee is currently conducting limited due diligence into the
fairness of the consideration proposed to be paid by the
stalking horse bidder.  This due diligence is not yet complete
because necessary information requested from the Debtors has not
yet been provided.

"Pending provision by the Debtors of information needed by the
Equity Committee's professionals to evaluate the sale and
complete limited due diligence, the Equity Committee reserves
the right to supplement this response and object at hearing to
the adequacy of consideration and the proposed bidding process,"
Mr. Bifferato says.

Nevertheless, Mr. Bifferato notes that one component of the
proposed purchase price is a cash payment of between $5,000,000
and $8,000,000.  Unless the amount of the proposed payment is
established, no competing bidder will be able to formulate its
bid.  To establish a fair bidding procedure for these assets, a
number in this range must be fixed.

Mr. Bifferato further tells Judge Newsome that the Equity
Committee is also investigating the potential asbestos-related
and other liabilities of Federal-Mogul Corporation and its
various subsidiaries and affiliates.  The Equity also takes in
to account that the Seller of the Lighting Business Assets,
Federal-Mogul Ignition Corporation, is a wholly owned subsidiary
of Federal Mogul Corp., and any proceeds of the sale must
therefore be paid directly to Federal-Mogul Corp.

In view of that, the Equity Committee requests an accounting of
the sale proceeds that observes the corporate distinction
between Federal-Mogul Corp., the 100% owner of the Seller,
Federal-Mogul Ignition, on one hand, and any other subsidiaries
or affiliates of the Debtors, on the other hand, so that the
proceeds of the sale are not used to satisfy asbestos or non-
asbestos liabilities of entities other than Federal-Mogul Corp.
(Federal-Mogul Bankruptcy News, Issue No. 22; Bankruptcy
Creditors' Service, Inc., 609/392-0900)

Federal-Mogul Corporation's 8.80% bonds due 2007 (FMO07USR1),
DebtTraders reports, are trading at 20 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=FMO07USR1for
real-time bond pricing.


GALEY & LORD: Turns to Rothschild-Italia for Financial Advice
-------------------------------------------------------------
Galey & Lord, Inc., and its debtor-affiliates ask for authority
from the U.S. Bankruptcy Court for the Southern District of New
York to engage Rothschild-Italia SPA, nunc pro tunc to August 1,
2002.  The Debtors want Rothschild-Italia to provide financial
advisory services in connection with the disposition of
substantially all equity interests in or assets of three wholly
owned G&L, Inc., subsidiaries:

    * Klopman International SRL, Klopman AG (Switzerland),
    * Klopman GmbH (Germany), and
    * International Textile SA (Tunisia),

The Debtors relate that Rothschild-Italia is a member of the
Rothschild Group, one of the world's leading independent
investment banking groups, with expertise in domestic and cross
border mergers and acquisitions, restructurings, privatization
advice, and other financial advisory services.  The Debtors
point out that Rothschild Group is experienced in providing high
quality financial advisory services, and valuation and
investment banking services to financially troubled companies
through its Financial Restructuring Group, based in New York.

The Debtors tell the Court that Rothschild-Italia is prepared
to:

     a) Study and evaluate Klopman and its business prospects.

     b) Identify and analyze the financial alternative available
        to the Debtors with respect to Klopman.

     c) Develop the strategy and tactics to be used in
        evaluating these alternatives in the market.

     d) If a Sale is pursued:

          i) Identify potential investors or purchasers and a
             strategy for approaching them;

         ii) Assist in the preparation of an Offering Memorandum
             describing Klopman and the opportunities that
             Klopman provides to prospective investors or
             purchasers to be used in soliciting the interest of
             such prospective investors or purchasers with
             respect to a Sale;

        iii) Provide analysis and advice in connection with the
             consideration of offers received relating to a
             Sale.

         iv) As directed by the Debtors, assist in the
             negotiation of a definitive agreement with a
             prospective investor or purchaser.

The Debtors agree to pay Rothschild-Italia:

     a) An EUR21,250 monthly financial advisory fee;

     b) A Transaction Fee equal to a percentage of the aggregate
        consideration received in a Sale:

           Aggregate Consideration            Transaction Fee
           -----------------------            ---------------
           EUR70,000,000 or less                   0.85%
           EUR70,000,001 to EUR 80,000,000         1.02%
           EUR80,000,001 to EUR 90,000,000         1.28%
           More than EUR90,000,001                 1.70%

G&L, a leading global manufacturer of textiles for sportswear,
including cotton casuals, denim, and corduroy, and is a major
international manufacturer of workwear fabrics, filed for
chapter 11 protection on February 19, 2002 together with its
affiliates. When the Company filed for protection from its
creditors, it listed $694,362,000 in total assets and
$715,093,000 in total debts.

Galey & Lord Inc.'s 9.125% bonds due 2008 (GYLD08USR1),
DebtTraders reports, are trading at 14 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=GYLD08USR1
for real-time bond pricing.


GENTEK: Fitch Corrects Downgrade Report on Bank Facility Rating
---------------------------------------------------------------
(This is an amended version of a news release that appeared in
the Monday, August 26, 2002, Edition of the Troubled Company
Reporter.  The senior secured bank facility rating is being
downgraded to 'CC' and the loan is not in default.)

Fitch Ratings has downgraded GenTek Inc.'s (GenTek) senior
secured bank facility rating to 'CC' from 'CCC' and the rating
on the senior subordinated notes to 'C' from 'CCC-'.

The ratings downgrade is based upon the recent payment blockage
relating to GenTek's scheduled Aug. 1, 2002 interest payment on
the 11% senior subordinated notes; the violation of certain
credit facility financial covenants and technical default on the
credit facility; and potential payment default on the senior
subordinated notes. GenTek's technical default on the credit
facility came about when the company's independent auditors
issued with the 2001 10k filing an explanatory paragraph with
respect to GenTek's ability to continue as a going concern. In
addition, GenTek violated certain financial covenants related to
the credit agreement at the end of the first quarter and second
quarter of 2002. More recently, GenTek's senior lenders issued a
payment blockage notice pursuant to its senior credit facility
preventing GenTek from paying interest due to the senior
subordinated noteholders. If GenTek is not permitted to make the
scheduled interest payment on or before Aug. 31, 2002, then they
will have defaulted on the senior subordinated notes and these
noteholders may accelerate payment of the outstanding principal
and accrued interest. At that time, Fitch will downgrade the
rating on the senior subordinated notes to 'D' due to payment
default.

GenTek is a diversified manufacturer with business segments
focused on manufacturing, performance products, and
communications. In 2001, GenTek had $1.2 billion in revenue and
$143 million in EBITDA.


GLOBAL CROSSING: Asks Court to Approve Settlement with Alcatel
--------------------------------------------------------------
Pursuant to various agreements, Global Crossing Ltd., and its
debtor-affiliates contracted Alcatel to construct:

    -- the Mid-Atlantic Crossing System,
    -- the First MAC System Upgrade,
    -- the South American Crossing System,
    -- the First SAC System Upgrade,
    -- the Cook's Crossing Upgrade, and
    -- the UK-Ireland System.

In addition, Alcatel agreed to maintain the Pan European
Crossing System and certain cable stations.  The Debtors regard
Alcatel as a strategic capital program vendor going forward due
to the large network embedded base that it developed and
constructed.

Michael F. Walsh, Esq., at Weil Gotshal & Manges LLP, in New
York, tells the Court that Alcatel asserts claims against the
Debtors aggregating $193,000,000, including administrative
expense claims for nonpayment related to prepetition
construction and equipment, and reimbursements for duties, taxes
and title transfer costs.  The Debtors dispute the existence,
amount, extent and priority of Alcatel's claims.  The Debtors
also assert a variety of claims against Alcatel including
preference claims and other claims aggregating $31,500,000 for
liquidated damages and reimbursement of overpayments.

To resolve the dispute, the parties entered into a Settlement
Agreement that provides:

A. Global Crossing Parties:  Global Crossing Ltd.; South America
   Crossing Ltd.; Global Crossing Ireland Ltd.; Global Crossing
   Network Center Ltd.; Mid-Atlantic Crossing Ltd.; Global
   Marine Systems Limited; and Pan American Crossing Ltd;

B. Alcatel Parties:  Alcatel; Alcatel Submarine Networks; and
   Alcatel Submarine Networks, Inc;

C. Initial Payment by Global Crossing to Alcatel:  $40,000,000
   within 10 business days after the Court's order approving the
   Settlement Agreement becomes a final order;

D. Emergence Payment:  $20,000,000 on the effective date of the
   Plan of Reorganization;

C. Termination Payment:  $500,000 in connection with the mutual
   termination of the Operations and Maintenance Agreement dated
   October 15, 1999, between Alcatel Submarine and GC Network
   Center;

D. Allowed General Unsecured Claim:  The Alcatel Parties will
   jointly have a single allowed general unsecured claim not to
   exceed $30,000,000 against a Debtor to be designated by
   Alcatel;

E. Title:  To the extent not previously transferred, Alcatel
   will take all actions required under the applicable Alcatel
   Agreements to effectuate title transfer to the appropriate
   Global Crossing affiliate free and clear of liens, claims and
   encumbrances;

F. Warranties:  The term of all warranties provided by the
   Alcatel Parties will be:

   -- 1 year from the effective date of the Plan of
      Reorganization with respect to all Alcatel Agreements
      Other than the Project Development and Construction
      Contract dated July 30, 1999, between South America
      Crossing and Alcatel Submarine; and

   -- 2 years from May 30, 2002, with respect to the South
      America Crossing Agreement other than with respect to the
      Las Toninas Cable Landing Station in Argentina and all
      equipment located therein;

   -- with respect to the Landing Station, the earlier of:

       a. 2 years from the date on which Alcatel Submarine
          completes the repairs on the roof of the Landing
          Station, and

       b. the date on which the Bankruptcy Court will, upon 10
          days prior written notice, have determined that the
          repair on the roof have been adequately completed;

G. Global Crossing Release:  On the date the Court approves the
   Settlement Agreement, the Debtors will release the Alcatel
   Parties from all claims relating to the Alcatel Agreements
   other than:

   -- claims arising under warranties contained in the Alcatel
      Agreements or applicable law, and

   -- the Debtors' claims against the Alcatel Parties relating
      to route and cable type selection and installation in
      connection with the Project Development and Construction
      Contract dated as of September 30, 1999, as amended,
      between Alcatel Submarine, Global Marine and GC Ireland;

H. Alcatel Release:  As of the Effective Date, the Alcatel
   Parties release the Debtors from all claims relating to the
   Alcatel Agreements other than claims of the Alcatel Parties
   against the Debtors relating to route and cable type
   selection and installation in connection with the Ireland-UK
   Agreement; and

I. Assumption of Executory Contracts:  The Debtors will assume
   these Alcatel Agreements, provided that no payments will be
   required in connection with the assumption:

   -- Project Development and Construction Contract dated as of
      June 2, 1998, as amended, among Alcatel Submarine and Mid-
      Atlantic Crossing;

   -- South America Crossing Agreement;

   -- Upgrade Contract dated as of October 16, 2001, as amended,
      between Alcatel Submarine and Pan American Crossing; and

   -- Ireland-UK Agreement. (Global Crossing Bankruptcy News,
      Issue No. 19; Bankruptcy Creditors' Service, Inc.,
      609/392-0900)


HAYES LEMMERZ: Keeps Plan Filing Exclusivity through December 16
----------------------------------------------------------------
Judge Walrath extends Hayes Lemmerz International, Inc., and its
debtor-affiliates' exclusivity periods.  The Debtors will
maintain the exclusive right to propose and file a Plan of
Reorganization through and including December 16, 2002, and the
Company has the exclusive right to solicit acceptances of that
plan from creditors through and including February 17, 2003.
(Hayes Lemmerz Bankruptcy News, Issue No. 16; Bankruptcy
Creditors' Service, Inc., 609/392-0900)

Hayes Lemmerz Int'l Inc.'s 11.875% bonds due 2006 (HLMM06USS1)
are trading at 67 cents-on-the-dollar, DebtTraders reports. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=HLMM06USS1
for real-time bond pricing.


ICG COMMS: Seeking Open-Ended Lease Decision Period Extension
-------------------------------------------------------------
For the fourth time, ICG Communications Inc., and its debtor-
affiliates ask the Court to extend the time within which the
Debtors may assume or reject their unexpired leases of
nonresidential real property until the effective date of the
Modified Plan, subject to the rights of each lessor under the
leases to ask for an order shortening the Extension Period, and
specifying a period of time in which the Debtors must determine
whether to assume or reject a particular Unexpired Lease.

Timothy R. Pohl, Esq., at Skadden Arps Slate Meagher & Flom, in
Chicago, Illinois, explains that the Debtors are filing this
motion out of an abundance of caution to:

      (a) confirm that they may assume or reject the Unexpired
          Leases by amending Schedule 7.3 to the Modified Plan
          at any time prior to the hearing on confirmation of
          the Modified Plan, and

      (b) seek an extension of the time to assume or reject the
          Unexpired Leases until the effective date of the
          Modified Plan.

Article VII of the Modified Plan continues to provide for the
assumption, assumption and assignment or rejection of each of
the Unexpired Leases.  The Debtors anticipate changing their
decisions as to some leases or contracts.  Accordingly, Schedule
7.3 of the Modified Plan will be amended prior to the Second
Confirmation Hearing.

The Debtors are lessees to over 900 Unexpired Leases.  Most of
the Unexpired Leases are for equipment facilities,
telecommunications switch sites, warehouses, and offices where
the Debtors operate their businesses.  The Unexpired Leases and
the premises covered are integral to the Debtors' continued
operations as they proceed toward a successful reorganization.
Consistent with the Original Plan, the Modified Plan designates
each Unexpired Lease for either assumption or rejection.

The Debtors contend that extending the deadline and allowing the
Debtors to assume or reject the Unexpired Leases until the
effective date of the Modified Plan is prudent and appropriate
to protect the interests of all creditors.  Court generally rely
on these factors to determine whether "cause" exists for an
extension of the assumption or rejection time period:

    * Whether the leases are primary assets and the decision
      to assume or reject such leases would be central to a
      plan of reorganization;

    * Whether the debtor has had sufficient time to analyze
      its financial situation and the potential value of its
      assets in terms of its reorganization strategy; and

    * Whether the lessor continues to receive postpetition
      rental payments.

Mr. Pohl tells Judge Walsh that these three factors are amply
satisfied in these cases because:

    * The premises governed by the Unexpired Leases are
      numerous and contain equipment facilities,
      telecommunications switch sites, warehouses and
      offices that are essential to the operation and
      ultimate reorganization of the Debtors' businesses;

    * Because of the failure of the Original Plan to
      become effective, the Debtors were required to
      modify their ongoing business plan to comport with
      the amount of liquidity they will have under the
      Modified Plan; the Debtors need additional time
      to re-evaluate certain of the Unexpired Leases in
      light of those changes; and

    * The Debtors "generally are current" on their
      postpetition rental obligations under the
      Unexpired Leases and have the financial
      wherewithal to remain so.

Thus, the Debtors contend that ample "cause" exists to grant the
requested extension.

Mr. Pohl assures the Court that extending the lease decision
deadline will not prejudice the lessors of the properties
subject to the Unexpired Leases because:

    * the Debtors are currently making required payments
      of monthly rent attributable to the postpetition
      period;

    * the Debtors have the financial ability and intend
      to timely perform all of their obligations under the
      Unexpired Leases as required by Section 365(d)(3)
      of the Bankruptcy Code;

    * in all instances, the Debtors propose to give
      individual lessors the express right to ask the
      Court to fix an earlier date by which the Debtors
      must assume or reject an Unexpired Lease, in
      accordance with Section 365(d)(2) of the Bankruptcy
      Code, without shifting the burden of proof to the
      lessor; and

    * the Debtors expect that a hearing on confirmation of
      the Modified Plan will be held within two months.

By application of Del.Bankr.LR 9006-2, the current deadline is
automatically extended through the conclusion of the August 29,
2002 hearing. (ICG Communications Bankruptcy News, Issue No. 29;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


IMMULOGIC PHARMA.: Will Transfer All Assets to Liquidating Trust
----------------------------------------------------------------
ImmuLogic Pharmaceutical Corporation (OTC Bulletin Board: IMUL)
will transfer all of its assets into a liquidating trust in
order to complete the liquidation and dissolution of the
corporation. Keith D. Lowey, of the accounting firm Verdolino &
Lowey, P.C., will serve as the Trustee. As of August 27, 2002,
the effective date of the Trust, the Corporation's stock
transfer books will be closed to further transfers of
outstanding shares of Common Stock. Thereafter, ImmuLogic's
stockholders will own a beneficial interest in the liquidating
trust equal to the percentage ownership of their ImmuLogic's
Common Stock at the time the stock record books closed. If there
is a final distribution to shareholders, it will be issued
before August 27, 2007.

The Corporation also announced that it filed Form 15 with the
Securities and Exchange Commission, a Certification and Notice
of Termination of Registration Under Section 12(g) of the
Securities Exchange Act of 1934 and Suspension of Duty to File
Reports Under Section 13 and 15(d) of the Securities Exchange
Act of 1934, pursuant to which the Corporation is seeking to
terminate the registration of the Corporation's Common Stock and
terminate the Company's reporting obligations under the
Securities and Exchange Act of 1934. As a result of the filing,
the Company's obligation to file quarterly, annual and special
reports with the SEC has been temporarily suspended. The
termination of registration of the Common Stock shall take
effect in 90 days, or such shorter period as the SEC may
determine. The Company's obligations to file any reports
required under Section 13(a) of the Exchange Act will
permanently cease within 90 days, unless the SEC denies the Form
15.

In August 1999, the Corporation's stockholders approved a Plan
of Complete Liquidation and Dissolution pursuant to Section 275
of the Delaware General Corporation Law. The Corporation filed a
Certificate of Dissolution with the Secretary of State of
Delaware on August 27, 1999 and will therefore be dissolved
under Delaware law effective August 27, 2002.


INSPIRE INSURANCE: Inks $22.2 Asset Sale Pact with CGI Group
------------------------------------------------------------
Inspire Insurance Solutions Inc., has entered into a non-binding
letter of intent to sell its operating assets to CGI Group Inc.,
for $8.2 million in cash plus the assumption of up to $14
million in liabilities, Dow Jones reports.  According to a Form
8-K filed with the Securities and Exchange Commission, Inspire
determined that reorganizing the company as an independent
entity "is not feasible."  The company filed for chapter 11
bankruptcy protection on Feb. 15 in the U.S. Bankruptcy Court in
Dallas. (ABI World, August 27, 2002)


INTEGRATED HEALTH: Sungard Seeks Payment of $1.18MM Admin. Claim
----------------------------------------------------------------
Prior to the Petition Date, Integrated Health Services, Inc.,
and its debtor-affiliates entered into a Recovery Services
Agreement with SunGard Recovery Services Inc.

The Agreement, as amended, provided for computer services to be
rendered by SunGard in case of a "Disaster" -- defined as "any
unplanned event or condition that renders IHS unable to use a
Location for its intended computer processing and related
purposes."

The Agreement provided for a basic monthly fee even in the
absence of a declaration of a Disaster, and for specified fees,
if the services were ever used in case of a Disaster.

There never was any declaration of a Disaster, and the Debtors
never used any of SunGard's computer support facilities.  The
Agreement was rejected effective June 6, 2000.

SunGard filed a proof of claim for $1,185,493, which consists
of:

  (i) an administrative expense priority claim for $105,874, and

(ii) an unsecured non-priority claim for $1,079,619.

The parties dispute over the $105,874 administrative expense
claim for basic monthly fees for the period from the Petition
Date to June 6, 2000.

SunGard asserts that it is entitled to an Administrative Expense
Priority Claim under Section 503(b)(1)(A) of the Bankruptcy Code
because it provided postpetition services to the Debtors and
these were actual, necessary services that benefited the estate.
SunGard argues that the maintenance and dedication of the
computer system it provided in the event of a Disaster is akin
to an insurance agreement, and postpetition insurance costs may
be granted administrative expense priority.

                         Debtors Object

The Debtors contend that SunGard is not entitled to the
allowance of an administrative expense because its claim fails
to meet the criteria under Section 503(b)(1)(A) of the
Bankruptcy Code.

James L. Patton, Jr., Esq., at Young Conaway Stargatt & Taylor
LLP, points out that to be allowed as an administrative expense:

      i. the debt must arise from a transaction with the debtor-
         in-possession; and

     ii. the payment must be beneficial to the debtor-in-
         possession in the operation of the business.

The policy behind the priority, Mr. Patton explains, is to
encourage creditors to extend credit and supply debtors with
goods and services postpetition in order to increase the
likelihood that a successful reorganization will occur.

SunGard's Administrative Claim fails to meet the criteria for
entitlement to first priority under Section 503(b)(1)(A), Mr.
Patton contends.

First, the debt does not arise from a transaction with the
Debtor-in-Possession.  SunGard never had any dealings with the
debtor-in-possession, but only with the prepetition debtor.
Moreover, the policy of encouraging transactions with debtors-
in-possession or trustees is not furthered by allowing this
claim, Mr. Patton argues.

Second, any service supplied was not beneficial to the Debtor-
In-Possession.  Mr. Patton notes that IHS made no postpetition
use whatsoever of the SunGard's services.

Thus, the Debtors ask the Court to deny SunGard's Administrative
Claim Motion in its entirety. (Integrated Health Bankruptcy
News, Issue No. 41; Bankruptcy Creditors' Service, Inc.,
609/392-0900)


KMART CORP: Wants Okay to Enter into AFCO Financing Pact
--------------------------------------------------------
In preparation for the yearly insurance renewal, and with the
assistance of Marsh USA, Inc., according to John Wm. Butler,
Jr., Esq., at Skadden, Arps, Slate, Meagher & Flom, in Chicago,
Illinois, Kmart Corporation and its debtor-afffiliates conducted
a comprehensive search for renewal insurance at the best
possible price.  Marsh approached several different insurance
carriers about providing insurance coverage for the Debtors.
Ultimately, Marsh succeeded in assembling a package of insurance
policies from a number of carriers, including CNA, IRA, Allied
World Assurance Company, and Crum & Forster.  The new policies
issued by these Carriers provide property insurance on Kmart's
stores and distribution centers.

The total annual cost of the premiums under the New Policies is
$9,600,000.  Although this amount is higher than the cost of the
company's current policies, Mr. Butler says the higher cost is
attributable primarily to market and other conditions.
Nevertheless, the Debtors' believe that they have negotiated the
best possible terms and prices for the New Policies.

Mr. Butler further states that the Debtors also determined to
pay the premiums under the New Policies in monthly installments.
The Debtors made this decision, in part, to manage their cash
flows. In order to make payments in monthly installments, the
Debtors obtained a commitment from AFCO Premium Credit, LLC to
pay the Carriers the full amount of the premiums and allow the
Debtors to finance the payments pursuant to the Finance
Agreement.  The Debtors propose to finance an amount equal to
$6,720,000.

Under the AFCO Finance Agreement:

(a) the Debtors are required to make a $2,880,000  down payment
    to AFCO upon the Court's approval of the Finance Agreement;

(b) the Debtors are also required to pay eight equal monthly
    installments to AFCO at $854,238 each.  The first
    installment is payable on September 1, 2002.  There is a
    $113,905 finance charge for this financing plus interest at
    4.5% annual percentage rate.  The total amount of monthly
    payments is $6,833,905;

(c) AFCO is granted a security interest in:

    (1) the gross unearned premiums which would be payable in
        the event of cancellation of the New Policies;

    (2) loss payments which reduce the Unearned Premiums subject
        to any mortgagee or loss payee interests; and

    any interests that may arise under state insurance guarantee
    fund relating to the New Policies.

    The Finance Agreement authorizes AFCO to cancel the financed
    policies and obtain the return of any unearned premiums in
    the event of a default in the payment of any installment
    due;

(d) In the event that the Debtors default under any terms of the
    Finance Agreement, AFCO may:

    (1) exercise rights as it may otherwise have under state
        law, notwithstanding the pendency of the Debtors'
        reorganization proceedings and without the necessity of
        further application to this Court;

    (2) cancel all insurance policies financed by the Finance
        Agreement or any amendment thereto; and

    (3) receive and apply all Unearned Premiums to the account
        of the Debtors.

    However, AFCO must provide to the Debtors and their counsel
    at least 10 days written notice of intent to cancel the
    financing prior to exercising their rights under the Finance
    Agreement; and

(e) In the event that, after application of any Unearned
    Premiums after an event of default, any sums still remain
    due to AFCO pursuant to the Finance Agreement, that
    deficiency shall be deemed an administrative expense of the
    Debtors' estates pursuant to Section 503(b) of the
    Bankruptcy Code.

The Debtor's believe that the terms of the Finance Agreement
represent the best possible terms for financing a portion of the
premiums of the New Policies.  "Insurance financing companies
such as AFCO often require debtors to make larger down payments
than required of the Debtors under the Finance Agreement and
charge higher interest rates," Mr. Butler asserts.  "Under the
Finance Agreement, however, the Debtors are being charged an
annual interest rate of only 4.50%.  The estate therefore will
benefit by the cost savings of obtaining this financing from
AFCO."

In view of that, the Debtors request for permission to enter
into a Commercial Premium Finance Agreement with AFCO. (Kmart
Bankruptcy News, Issue No. 31; Bankruptcy Creditors' Service,
Inc., 609/392-0900)

Kmart Corp.'s 9.0% bonds due 2003 (KM03USR6), DebtTraders
reports, are trading 17 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=KM03USR6for
real-time bond pricing.


LAIDLAW INC: Nov. 30, 2001 Balance Sheet Upside-Down by $1.06BB
---------------------------------------------------------------
Laidlaw Inc., announced financial results for the first quarter
of fiscal 2002 (ended November 30, 2001), as well as for the
second quarter (ended February 28, 2002) and first six months of
fiscal 2002.

                   Consolidated Revenue

For the six months ended February 28, 2002, the consolidated
revenue for the Company's Contract Bus services (school busing,
municipal and paratransit), Greyhound, and Healthcare services
(healthcare transportation and emergency department management
services) declined to $2.267 billion from the $2.274 billion
reported for the first six months of fiscal 2001.

For the quarter ended November 30, 2001, the Company's
consolidated revenue declined slightly to $1.162 billion from
the $1.169 billion reported for the comparable period in fiscal
2001.

                     Consolidated EBITDA

Consolidated earnings before interest, taxes, depreciation and
amortization (EBITDA) for the first six months of fiscal 2002,
before the goodwill impairment charge at Greyhound discussed
below, declined to $270.3 million compared to the $288.6 million
for the first six months of fiscal 2001.

Consolidated EBITDA for the first quarter of fiscal 2002, before
the Greyhound goodwill impairment charge, was $147.9 million
compared with $175.5 million for the prior year quarter.

            Recontinuance of Healthcare Businesses

As previously reported, during the fourth quarter of the
Company's 2001 fiscal year, the Company determined that the
Healthcare services businesses no longer qualified for
classification as discontinued operations. The Company intends
to operate these service businesses with a view towards
maximizing long-term value. The Healthcare services operating
results for the prior periods, which previously were reported as
discontinued operations, have been reclassified as continuing
operations. Certain items in the fiscal 2001 results have been
reclassified to present all operations as "continuing" in
the comparative fiscal period.

                   Goodwill Impairment

During the three months ended November 30, 2001, the Company
incurred a goodwill impairment charge of $123.5 million at
Greyhound. The Company reviewed the value assigned to goodwill
because the following factors indicated that a permanent
impairment in value existed at the Greyhound operations. A
significant decrease in the market value of the business had
occurred primarily due to reduced passenger loads as a result of
September 11, 2001 and an unrelated October 2001 incident
involving a Greyhound passenger. In addition to these factors,
Greyhound was adversely impacted by generally negative economic
conditions. The goodwill impairment was calculated based on
independent valuations of the underlying businesses.

The Company is continuing to review its ability to recover the
carrying value of goodwill. Upon completion of this review it is
anticipated that further goodwill impairment charges will be
taken during the third quarter of fiscal 2002.

                             Net Loss

The Company reported a net loss of $61.1 million for the six
months ended February 28, 2002 compared with a net loss of $90.0
million for the same fiscal 2001 period.

For the quarter ended November 30, 2001, the Company reported a
net loss of $79.9 million compared with a net loss of $15.7
million for the same fiscal 2001 period.

                          Segment Results

In addition to reporting the Healthcare businesses as continuing
operations, as previously discussed, the Company has changed the
reportable segments for the fiscal 2002 periods described in
this release as compared to fiscal 2001. The former Education
Services segment, which consisted solely of the school busing
operations, has been combined with the municipal and paratransit
operations to form the Contract Bus services segment. The former
Inter-city, Transit and Tour services segment, which consisted
of Greyhound operations and the municipal and paratransit
operations, now consists only of the Greyhound operations and
has been renamed Greyhound.

                        Contract Bus Services

During the six months ended February 28, 2002, revenue for the
Company's Contract Bus services segment increased 1.5% to $1.001
billion from $986.6 million for the comparable period in fiscal
2001. EBITDA at the Contract Bus services level was $202.5
million for the first six months of fiscal 2002 compared with
$197.0 million reported for the comparable period in fiscal
2001.

During the first quarter of fiscal 2002, revenue for the
Company's Contract Bus services segment increased 0.6% to $
527.0 million from $523.8 million for the comparable period in
fiscal 2001. For the quarter ended November 30, 2001 EBITDA at
Contract Bus services was $117.7 million compared with EBITDA of
$119.7 million reported for the first quarter of fiscal 2001.

                          Greyhound

For the six months ended February 28, 2002 revenue at the
Greyhound operations declined 3% to $565.7 million from the
$583.3 million reported for the first six months of fiscal 2001.
EBITDA at the Greyhound level, before the $123.5 million
goodwill impairment charge, was $18.3 million, versus EBITDA of
$26.5 million reported for the comparable fiscal 2001 period.

Revenue at Greyhound operations for the quarter ended November
30, 2001 declined 3.4% to $284.2 million compared with $294.2
million reported for the comparable fiscal 2001 period. EBITDA
at the Greyhound level, before the $123.5 million goodwill
impairment charge, declined to $5.2 million for the quarter
ended November 30, 2001 from EBITDA of $21.3 million reported
for the first quarter of fiscal 2001.

                     Healthcare Services

Healthcare services' revenue was $700.4 million for the six
months ended February 28, 2002, a 0.5% decline from the $704.2
million reported for the first six months of fiscal 2001. EBITDA
at Healthcare services was $49.5 million compared with EBITDA of
$65.1 million reported for the comparable 2001 period.

Healthcare services' revenue for the quarter ended November 30,
2001 was virtually unchanged at $350.6 million compared with
$350.8 million reported for the comparable period in fiscal
2001, while EBITDA for the first quarter of fiscal 2002 at the
Healthcare services level decreased to $25.0 million compared
with $34.5 million reported for the first quarter of fiscal
2001.

Revenue growth at the Contract Bus services level is primarily
attributable to price and volume increases. The revenue decline
in Greyhound reflects the impact of September 11, 2001 and the
October 2001 incident involving a Greyhound passenger. Increased
automobile use resulting from decreased fuel prices and the
general economic downturn were also factors in the decline in
revenue at Greyhound.

EBITDA declines (before the goodwill impairment charge at
Greyhound) in all segments are primarily attributable to
increased accident claim and personnel-related costs. In
addition, reduced inter-city ridership and tour cancellations
affected Greyhound.

Laidlaw Inc., is a holding company for North America's largest
providers of school and inter-city bus transportation, public
transit, patient transportation and emergency department
management services. All dollar amounts are in U.S. dollars.

At November 30, 2001, Laidlaw Inc.'s balance sheet shows a total
shareholders' equity deficit of about $1.065 billion.


LAIDLAW INC: Appoints Kevin E. Benson as New President and CEO
--------------------------------------------------------------
The Laidlaw Board of Directors has appointed Kevin E. Benson as
president and CEO of the Company.  Mr. Benson is expected to
assume his new duties as president and CEO on September 16,
2002.  Mr. Benson most recently served as president of the Jim
Pattison Group, Canada's third largest privately held company,
and as the president and CEO of the Insurance Corporation of
British Columbia. He previously served as CEO of Canadian
Airlines from 1996 until the sale of the company to Air Canada
in 2000. Prior to joining Canadian Airlines in 1995, he served
in various capacities with Trizec-Hahn, a Canadian real estate
development company with property holdings in the U.S. and
Canada, joining the company in 1977 and becoming chief financial
officer in 1983, president in 1986 and CEO in 1987. Mr Benson
also serves as a director of Manulife Financial.

"The stakeholders of Laidlaw Inc., are indeed fortunate to have
secured a leader with the transportation management experience
of Mr. Benson," says Peter Widdrington, Chairman of the board of
directors at Laidlaw. "His depth of knowledge and leadership
style are excellent compliments to the needs of the company at
this point and into future."

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

Laidlaw Inc.'s 8.25% bonds due 2023 (LDM23USR1), DebtTraders
reports, are trading at 61.5 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=LDM23USR1for
real-time bond pricing.


LORAL SPACE: Commences Exchange Offer for Preferred Shares
----------------------------------------------------------
Loral Space & Communications (NYSE: LOR) has commenced an
exchange offer for all of its outstanding preferred stock as
part of its ongoing strategy to reduce debt and increase its
financial flexibility, it was announced by Bernard L. Schwartz,
chairman and chief executive officer.

The company said it continues to generate substantial positive
cash flow from operations and has decided to take this step to
enhance its balance sheet by further reducing its fixed
obligations. Loral has successfully implemented previous
exchanges for its preferred stock.

Loral said that it is offering to exchange $1.92 in cash and
four shares of Loral common stock for each share of its Series C
and Series D preferred stock. The offer represents a total of
$3.96 for each share of Series C and D preferred stock, based on
today's closing price of $.51 for Loral common stock.

As of June 30, 2002, there were 8,084,174 outstanding shares of
the Series C preferred stock and 3,391,688 outstanding shares of
the Series D preferred stock. If all of the preferred shares
participate, Loral will exchange $22 million in cash and 45.9
million common shares for preferred stock that has a liquidation
preference of $574 million.

The offer is contingent on participation of a minimum of 50
percent, in the aggregate, of all outstanding shares of the two
series of preferred stock.

The offer extends to all outstanding shares of the Series C and
D Preferred issues, and remains open until 12:00 a.m. midnight,
New York City time, September 25, 2002, unless extended.

In connection with this financial strategy, Loral's Board of
Directors has approved a plan to suspend indefinitely the future
payment of dividends on its two series of preferred stock.
Accordingly, Loral will defer the payment of quarterly dividends
due on its Series C preferred stock on November 1, 2002, and its
Series D preferred stock on November 15, 2002. Dividends on the
two series will continue to accrue.

Documents describing the exchange offer in greater detail are
being mailed to holders of Series C and Series D Preferred
Stock. Series C and D shareholders who wish to participate in
the exchange offer should contact the company's information
agent, Morrow & Co., Inc., at (800) 607-0088. Exchanges will be
effected by The Bank of New York, the exchange agent for the
offer.

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

As previously reported, Loral's June 30, 2002 balance sheet
shows a $68.3 million working capital deficit and $1.1 billion
of shareholder equity evaporated in the first half of 2002.


LTV CORP: Court Approves Hazelwood Works Sale to ALMONO LP
----------------------------------------------------------
The U.S. Bankruptcy Court in Youngstown approved the sale of
LTV's former Hazelwood Works to ALMONO, LP, a non-profit
partnership of four Pittsburgh foundations and the Regional
Industrial Development Corporation of Southwestern Pennsylvania.

RIDC serves as general partner for the group, which also
includes Claude Worthington Benedum Foundation, The Heinz
Endowments, Richard King Mellon Foundation and the McCune
Foundation.  Formal transfer of the 178-acre site bounded by
Second Avenue and the Monongahela River should occur in the next
30 days.

"We are delighted that this partnership will now be able to move
forward with its vision of creating an exemplary mixed-use site
on this important property," said Frank Brooks Robinson, Sr.,
president of RIDC.  "The court's approval brings to a close over
18 months of discussion and negotiation with LTV.  We intend to
move ahead with the redevelopment effort as quickly as
possible."

"We're especially pleased to have the support of the mayor for a
vision that we both share to develop this property quickly and
appropriately," added Robinson.  "While the bankruptcy process
delayed the formal acquisition of this prime site, it did give
us time to complete preliminary planning work so that we are
ready to move forward."

Robinson again emphasized that the ALMONO partnership will
continue with a comprehensive community involvement process
involving city officials, redevelopment experts, university
officials, representatives of the Hazelwood community and
others, who will finalize the requirements for development of a
site master plan and the selection of a consultant to complete
it.

Development of the site is subject to approvals from a variety
of city and state agencies.

RIDC is recognized as one of Pennsylvania's largest and most
successful not-for-profit economic development agencies.  RIDC
has been active in the development of urban and suburban
business parks in the ten counties of southwestern Pennsylvania.
In addition, RIDC acts as loan sponsor on behalf of business
enterprises throughout the region with a variety of city, state
and federal agencies.


MALAN REALTY: Cohen Fin'l Completes Fund-Raising Transaction
------------------------------------------------------------
Cohen Financial announced the completion of a challenging
assignment on behalf of Malan Realty Investors, Inc.,
(NYSE:MAL).

The transaction was highlighted by the on-deadline retirement of
a $57.8 million loan -- a transaction that in itself was made
possible only through an aggressive property sales initiative,
paralleled by financing back-ups, that Cohen Financial
successfully completed during the same time frame.

Cohen Financial completed the sale of six properties and closed
three financings that generated proceeds to repay the loan, a
real estate mortgage conduit. It was not feasible to extend the
term of this type of securitized bond obligation and it had to
be retired on time. The six properties were sold for a total of
$14.8 million.

Jack Cohen, CEO, Cohen Financial, said, "We provided a huge
benefit to our client. In a similar situation, a client would
retain a pure investment sales broker to sell assets. Then he
would come to the conclusion that he would also require a
financing back-up, and he'd also hire an intermediary to work
the capital markets."

He added, "Even assuming the sales broker and the intermediary
were able to get up to speed quickly, the client would be faced
with managing two vendors with competing interests - against a
running clock. Cohen Financial did all that for Malan Realty
Investors. We were a single point of contact, managing both
paths of execution to a successful closing."

                         The Challenge

Malan Realty Investors is a publicly traded retail real estate
investment trust, based in Bingham Farms, MI. Malan originally
retained Cohen Financial as its financial advisor in the spring
of 2001, evaluating alternative strategies available to the REIT
- either through sales or refinancings - to create maximum value
for their shareholders. Malan authorized Cohen Financial in
early 2002 to sell a pool of assets in order to pay off the
REMIC.

Cohen Financial analyzed Malan's properties, prioritized each
asset by its expected sale proceeds, existing debt structure,
market appeal and future value-creation potential, and assembled
a proposed pool of properties to take to market for sale.

At the direction of Malan's management and Board, Cohen
Financial's focus was on the sale of properties to pay off the
REMIC. "Due to the short time period remaining on the REMIC and
the necessity to pay it off by maturity," explained Rick
Tannenbaum, managing director of Advisory Services, "Cohen
Financial implemented a plan to back up sale contracts with
financing commitments in order to ensure the timely repayment of
the REMIC."

                         Unforeseen Challenges

During this process, Kmart, a tenant accounting for one-quarter
of Malan's revenues, filed for bankruptcy protection. Mr.
Tannenbaum said, "This caused us to revisit the pool of
properties we would take to market based on the additional
dimension of market perception of the strength of the asset,
absent Kmart as a long-term tenant. Ultimately, we marketed the
Kmart assets but increased the number of non-Kmart properties to
be offered."

Cohen Financial went to market in the spring of 2002 with 25
Kmart anchored centers, five Wal-Mart anchored centers, and 13
shadow-anchored Wal-Mart centers. The loan maturity date was
August 10, 2002.

                         Mission Accomplished

Cohen Financial arranged the sale of six properties in the
Midwest for $14.8 million, comprising 467,685 square feet of
gross leasable area to help retire the REMIC. They included
Sherwood Plaza in Springfield, IL; Kmart Plaza in Salina, KS;
South City Center in Wichita, KS; Kmart Plaza in Jefferson City,
MO; Pine Ridge Plaza, Lawrence, KS, and Kmart Plaza, Janesville,
WI.

Cohen Financial refinanced three Malan retail portfolios that
include mostly Kmart stores with Wal-Mart and target stores in
one portfolio. The total loan amount of three bridge loans to
refinance the properties is approximately $43 million.

John Vander Zwaag, managing director, Cohen Financial Capital
Markets Unit, said, "All three loans have one-year terms with
the expectation that the bridge loan positions will be removed
with the sales of properties." He added, "We have a number of
sales transactions pending against properties in these loan
portfolios already which we expect to close shortly. We will be
actively marketing the balance of them throughout the next
year."

Mr. Cohen said, "This multi-role assignment illustrates why
commercial real estate companies hire Cohen Financial instead of
somebody else. This was a Herculean effort, but we successfully
helped our client accomplish their objectives."

Cohen Financial is a national commercial real estate investment
and finance company offering a wide range of products and
services. The company is the nation's third-largest originator
of commercial real estate loans, manages more than $3 billion of
investments (including $300 million of its own investments) and
has provided financial advisory services on more than $1 billion
of assets. The company has offices in 10 major US markets, more
than 135 experienced real estate and finance professionals on
staff, and a market capitalization value in excess of $100
million.

                         *    *    *

As reported in Troubled Company Reporter's August 5, 2002
edition, the Company's board adopted a plan of complete
liquidation of the company, which was presented to shareholders
yesterday for acceptance.  This plan, approved by the board in
July 2002, provides for the orderly sale of assets for cash or
such other form of consideration as may be conveniently
distributed to shareholders, payment of or establishing reserves
for the payment of liabilities and expenses, distribution of net
proceeds of the liquidation to common shareholders, the wind-up
of operations and dissolution of the company.


METALS USA: Summary & Overview of Proposed Reorganization Plan
--------------------------------------------------------------
Metals USA proposes to cancel all existing equity interests in
the company and discharge all unsecured debts against the
Estates, including the 8.625% Notes.  Metals USA's assets will
revest in Reorganized Metals USA and the stock in that
substantially deleveraged entity will be used to compromise
unsecured creditors' claims against the Debtors.  Warrants (wish
certificates, perhaps) will be delivered to current
shareholders.

The Debtors believe that their Chapter 11 Plan of Reorganization
filed with the U.S. Bankruptcy Court in Texas provides the best
possible outcome for the Company's stakeholders.  The Debtors
stress that the Plan is the product of negotiations with the
Creditors' Committee.

The DIP Lenders (projected to be owed $100 to $125 million on
the Effective Date), Administrative Claimants, Priority Tax
Claimants and Other Priority Creditors will be paid in full in
Cash on the Effective Date.  Any other Secured Debts will be
reinstated, paid in full in cash, or will be satisfied by
returning the collateral securing the claim.  The Reorganized
Debtors will obtain the funds necessary to make these cash
payments from the proceeds of (x) an Exit Credit Facility or (y)
Cash on hand.

Approximately $378.5 million of Unsecured Debt will be
discharged and exchanged for 20 million shares of New Common
Stock in the Reorganized Parent Company on the Effective Date.
On the Effective Date, the Holders of Allowed General Unsecured
Claims will own substantially all of the outstanding shares of
the New Common Stock.  The Debtors project the value of the new
stock will provide for a 52.6% recovery to Unsecured Creditors.

Holders of Existing Common Stock of the Parent Company as of the
Distribution Record Date will receive 5-year Warrants to
purchase shares of the New Common Stock representing an
aggregate of 15% of all of the shares issued or issuable on the
Effective Date.  The Warrants will have an exercise price that
will be the price-per-share that must be achieved for the shares
of the New Common Stock issued to the Holders of Allowed General
Unsecured Claims on the Effective Date to be worth 100% of the
aggregate dollar amount of Allowed General Unsecured Claims that
are discharged on the Effective Date pursuant to the Plan.
(Metals USA Bankruptcy News, Issue No. 18; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


MTI TECHNOLOGY: Working Capital Deficit Tops $1.1M at July 6
------------------------------------------------------------
MTI Technology Corp. (Nasdaq:MTIC), a provider of enterprise
storage solutions, announced financial results for its fiscal
2003 first quarter ended July 6, 2002.

For the fiscal 2003 first quarter ended July 6, 2002, MTI
reported total revenue of $18 million, compared with $29.8
million for the fiscal first quarter last year and $25.7 million
for the fourth quarter of fiscal 2002. Net product revenue for
the first quarter 2003 was $7.1 million, compared with $17.3
million in the year ago period and $14.7 million in the
immediately preceding quarter.

Service revenue for the first quarter 2003 was $10.9 million,
compared with $12.6 million in the year ago period and $11
million in the fourth quarter of fiscal 2002. Gross profit
margin for the first quarter of fiscal year 2003 was 5.8%
compared with 18% in the same period last year and 27.6% for the
fourth quarter of fiscal 2002.

The company recorded additional charges for excess and obsolete
inventory of $2.6 million and the write-off of fixed assets of
$900,000 as a result of the company's continued restructuring
efforts.

The company also recorded an additional restructuring charge of
$1 million related to the abandonment of either underutilized or
historically unprofitable facilities, headcount reductions and
the completion of the transition of its manufacturing facilities
to Dublin, Ireland. Before giving effect to the non-cash
inventory charges, gross profit margin would have been 20.5%.

Gross profit was significantly affected by lower operating
efficiencies as a result of lower production volumes and product
mix.

The pretax loss for the quarter was $10.5 million including the
$1 million restructuring charge, the additional $2.6 million of
inventory related charges and the $900,000 write-off of fixed
assets. The company reported a net loss of $0.32 per share,
compared with a net loss of $1.13 per share for the like quarter
of the prior year and $0.33 per share in the fourth quarter of
fiscal 2002.

As of July 6, 2002, the company had $8.2 million in cash and
cash equivalents, no long-term bank borrowings, a short-term
note payable of $1.9 million and negative working capital of
$1.1 million. The company has a line of credit with an
affiliated company for $7 million.

Early in the second quarter of 2003, the company borrowed $1.9
million against the line of credit, paid off the short-term note
payable that was also payable to the affiliated company, and
then, through the sale of its stock holdings in Caldera
International Inc., paid down the line of credit by
approximately $1 million.

In addition, in the second quarter of 2003, the company borrowed
an additional $750,000 to meet domestic vendor payment
obligations as a result of second quarter revenue shipments and
backlog commitments. As of Aug. 27, 2002, the company has $5.35
million available on the line of credit.

MTI's mission is to provide Continuous Access to Online
Information(SM) through fault-tolerant, cross-platform data
storage servers for the enterprise. MTI develops, manufactures,
sells and services data server solutions for Global 2000
companies on a worldwide basis.

With headquarters in Anaheim, the company offers services and
support from offices in the United States and Europe and
complies with ISO 9001 quality system standards. For more
information, visit the company's Web site at http://www.mti.com


NATIONAL GYPSUM: ACMC Case Summary & 40 Largest Unsec. Creditors
----------------------------------------------------------------
Debtor: Asbestos Claims Management Corporation
        2716 Lee Street, #500
        Greenville, Texas 75401

Bankruptcy Case No.: 02-37124

Chapter 11 Petition Date: August 19, 2002

Court: Northern District of Texas (Dallas)

Judge: Steven A. Felsenthal

Debtors' Counsel: Michael A. Rosenthal, Esq.
                  Gibson, Dunn & Crutcher
                  2100 McKinney Ave., Suite 1100
                  Dallas, TX 75201
                  214-698-3100

                      - and -

                  Janet M. Weiss, Esq.
                  Gibson, Dunn & Crutcher
                  200 Park Avenue
                  New York, NY 10166
                  212-351-4000

Estimated Assets: More than $100 Million

Estimated Debts: More than $100 Million


Debtor's Unsecured Creditors:

List of law firms representing Asbestos Bodily Injury Claims:

All Claims are unliquidated.

Law Firm                                   Estimated Claimants
--------                                   -------------------
Weitz & Luxenberg                                   13,298
Perry Weitz
180 Maiden Lane
New York, NY 10038
(212) 558-5500

Silber Pearlman, LLP                                 6,559
Steven Baron
2711 N. Haskell Avenue
5th Floor LB 32
Dallas, TX 75204
(214) 874-7400

Williams & Bailey Law Firm                           5,578
Steve Kherkher
8441 Gulf Freeway
Suite 600
Houston, Texas 77017
(713) 230-2258

Foster & Sear, LLP                                   5,344
Damon Chargois
360 Place Office Park
1201 N. Watson Road, Suite 145
Arlington, TX 76006
(817) 633-3355

Provost & Umphrey Law Firm                           5,063
Walker Umphrey
490 Park Street
PO Box 4905
Beaumont, Texas 77704
(409) 835-6000

Peter G. Angelos, Esq.                               4,703
2001 Front Street
Building 3 Suite 330
Harrisburg, PA 17102
(717) 232-1886

Baron & Budd                                         4,413
Russell Budd
3102 Oak Lawn Avenue
Suite 1100
Dallas, Texas 75219
(214) 521-3605

Kelley & Ferraro, LLP                                4,026
James L. Ferraro
1300 East North Street
1901 Bond Court Building
Cleveland, Ohio 44114
(216) 575-0777

Reaud, Morgan & Quinn, Inc.                          3,965
Glen W. Morgan
801 Laurel Street
PO Box 26005
Beaumont, TX 77720-6005
(409) 838-1000

Pierce Raimond & Associates                          3,925
Robert F. Daley
949 3rd Avenue, Suite 201
Huntington, WV 26003

Goldberg, Persky, Jennnings & White, PC              2,785
Joel Persky, Esq.
1030 Fifth Avenue
Third Avenue
Pittsburgh, PA 15219-6295
(412) 471-3980

Deakle Law Firm                                      2,560
John Deakle
PO Box 2072
802 Main Street
Hattiesburg, MS 39403
(601) 544-4218

Nix, Patterson & Roach, LLP                          2,344
Tim Larsen
205 Linda Drive
Daingerfield, TX 75638
(903) 645-7333

LeBlanc & Waddell, LLC                               2,071
J. Burton LeBlanc, IV
Essen Center, Suite 420
5353 Essen Lane
Baton Rouge, LA 70809

Campbell, Cherry, Harrison, Davis & Dove             2,068
Craig Cherry
5 Ritchie Road
PO Drawer 21387
Waco, Texas 7672
(254) 761-3300

Manley Burke Lipton & Cook                           2,063
Timothy Burke
225 West Court Street
Cincinnati, Ohio 45202
(513) 721-5525

Cascino Vaughan Law Offices                          1,970
Michael Cascino
220 S. Ashland Avenue
Chicago, Illinois 60607-5308
(213) 944-0600

Doffermyre Shields Canfield Knowles et al            1,690
Everette Doffermyre
1355 Peachtree Street
Suite 1600
Atlanta, Georgia 30309
(404) 881-8900

Jaques Admiralty Law Firm                            1,678
Maritime Asbestosis Legal Clinic
1370 Penobscot Building
Detroit, Michigan 48226-4192
(313) 961-1080

Glasser & Glasser                                    1,566
Michael Glasser
Crown Center Building, Suite 600
580 Main Street
Norfolk, Virginia 23510
(757) 625-6787

Hartley, O'Brien, Parsons, Thompson & Hill           1,306
2001 Main Street
Suite 600
Wheeling, WV 56003
(304) 233-0777

Edward O. Moody                                      1,194
Moody & Ritchie
801 West Fourth
Little Rock, AR 72201
(501) 376-0000

Ness, Motley, et al - Mt. Pleasant, SC               1,188
Ron Motley
28 Bridgeside Boulevard
PO Box 1792
Mount Pleasant, SC 29464

James F. Humpreys & Associates LC                    1,092
Bank One Center
707 Virginia Street E - Suite 1113
Charleston, WV 25301
(304) 347-5050

Barrett Law Offices                                  1,051
404 Court Square North
PO Box 987
Lexington, Ms. 39095-2628
(662) 834-2376

Ferraro & Associates P.A.                            1,040
James L. Ferraro
200 S Biscayne Blvd.
Suite 3800
Miami, FL 33131-2310
(305) 375-0111

Climaco Climaco Lefkowitz & Garofoli PA              1,037
1228 Euclid Avenue
Suite 900
Cleveland, Ohio 44115-1891
(261) 621-8484

John F. Dillon                                       1,002
1515 Paydras Street
Suite 2080
New Orleans, LA 70112

Wallace & Graham PA                                    975
525 North Main Street
Salisbury, NC 28144
(704) 633-5244

Robert A. Pritchard                                    946
1325 Canty Street
PO Drawer 1707
Pascagoula, Ms. 39568-1707

Donnie Young                                           907
600 Carondelet Street
Suite 900
New Orleans, LA 70180

Parker & Parks                                         882
Chris Parks
One Plaza Square
Prot Arthur, Texas 77642
(409) 985-8814

Hissey, Kientz & Herron, PLLC                          807
723 Main Street
Suite 510
Houston, TX 77002
(713) 224-7670

John J. Duffy & Associates                             759
Brendan Place
23823 Lorain Road, Suite 270
North Olmstead, OH 44070
(440) 779-6636

Harvit & Schwartz, LC                                  741
2018 Kanawha Boulevard
East Charleston, WV 25311
(304) 343-7561

Odom & Elliott, Attorneys at Law                       732
Don R. Elliot
PO Box 1868
1 East Mountain
Fayettesville, AR 72701
(479) 442-7575

David Lipman, PA                                       709
5901 Southwest 74th Street
Suite 304
Miami, FL 33143-5186
(305) 662-2600

Lanier Parker & Sullivan                               655
1331 Lamar
Suite 1550
Houston, TX 77010
(281) 537-7521

Louis S. Robles, PA                                    638
100 South Biscayne Boulevard
Suite 900
One Bayfront Plaza
Miami, FL 33131
(305) 371-5944


NATIONAL STEEL: Bondholders Block Illinois Power Compromise
-----------------------------------------------------------
The Committee of First Mortgage Bondholders in the chapter 11
cases involving National Steel Corporation contends that there
is no provision in the Bankruptcy Code that allows for the
payment of a prepetition unsecured claim prior to plan
confirmation, unless the payment is part of a cure to be made on
the assumption of an executory contract or unexpired lease.  In
this case, the Debtors have sought to reject the lease instead.
Therefore, the proposed payment of Illinois Power Company's
$1,700,000 prepetition general unsecured claim should not be
allowed.

Steven B. Towbin, Esq., at D'Ancona & Pflaum, LLC, in Chicago,
Illinois, argues that the payment of selected prepetition claims
prior to plan confirmation violates the priority provisions of
the Bankruptcy Code.  Moreover, that payment has the effect of
subordinating all other similarly situated creditors and
violates the fundamental tenet of bankruptcy law of equality of
treatment for similarly situated creditors.

In addition, Mr. Towbin points out that the payment of Illinois
Power's claim is troubling due to the fact that Illinois Power
is a utility.  Section 366 of the Bankruptcy Code is intended to
protect debtors, their estate, and their creditors from
utilities using their status as utilities to force debtors from
impermissibly paying prepetition general unsecured claims to
utilities for fear of disparate treatment.

Mr. Towbin also observes that, although the Debtors assert that
the Proposed Agreement would yield a $3,600,000 savings from the
rate of the Contract they seek to reject, the savings come at a
cost of the $1,700,000 payment made on account of Illinois
Power's prepetition general unsecured claim.  The savings also
comes without assurances as to the rate at which services will
be provided in future years.  "This undermines the assertion
that the Proposed Comprise is in the best interest of the
estates and their creditors," Mr. Towbin says. (National Steel
Bankruptcy News, Issue No. 13; Bankruptcy Creditors' Service,
Inc., 609/392-0900)


NCS HEALTHCARE: Omnicare Responds to Statements on Tender Offer
---------------------------------------------------------------
Omnicare, Inc. (NYSE: OCR), a leading provider of pharmaceutical
care for the elderly, sent a letter to the Board of Directors of
NCS HealthCare, Inc. (NCSS.OB). The full text of the letter
follows:

August 27, 2002

BY FACSIMILE AND OVERNIGHT COURIER

Board of Directors
NCS HealthCare, Inc.
3201 Enterprise Parkway
Suite 220
Beachwood, Ohio 44122

Gentlemen:

"We have reviewed the Schedule 14D-9 filed by NCS HealthCare,
Inc., on August 20, 2002, in response to Omnicare, Inc.'s tender
offer of $3.50 per share in cash for all of the outstanding
shares of Class A and Class B common stock of NCS and the recent
public statements made by NCS regarding Omnicare's tender offer.
We feel compelled to respond to your public statements regarding
Omnicare's tender offer so that your stockholders will have the
facts and not continue to be misled.

"1. LET US MAKE ONE FACT PERFECTLY CLEAR.  OMNICARE'S TENDER
    OFFER IS NOT CONDITIONED ON DUE DILIGENCE.

"You have stated that Omnicare's tender offer is conditioned on
due diligence.  This statement is false.  As is clear on the
face of our Offer to Purchase, OMNICARE'S TENDER OFFER IS NOT
SUBJECT TO ANY DUE DILIGENCE AND DOES NOT INCLUDE A DUE
DILIGENCE CONDITION.

"2. THE CONDITIONS TO OUR TENDER OFFER RELATE PRIMARILY TO THE
    ILLEGAL AGREEMENTS THAT NCS AND MESSRS. OUTCALT AND SHAW
    HAVE ENTERED INTO WITH GENESIS.

"You also claim that our tender offer is highly conditional and
that the conditions to our tender offer are not capable of being
satisfied.  That is just wrong.  In fact, most of the conditions
to our tender offer are necessitated only by the illegal
NCS/Genesis Merger Agreement and the voting agreements entered
into by Messrs. Outcalt and Shaw, in clear violation of your
fiduciary duties.  The satisfaction of these conditions is well
within your control.  It is disingenuous of you to claim that
our offer is highly conditional when such conditions are
primarily the result of your illegal actions.

"Moreover, Omnicare has supplemented its Offer to Purchase to
make clear that any determination relating to the satisfaction
of any of the conditions to the tender offer will be made on a
reasonable basis.

"3. OMNICARE'S TENDER OFFER IS "SUPERIOR" TO THE GENESIS
    TRANSACTION.

"Our $3.50 per share fully financed, all-cash offer is superior
to the Genesis offer, which, based on yesterday's closing stock
price, is worth approximately $1.57 per share.  We would rather
have $3.50 per share than $1.57 and assume that your
stockholders also would conclude that $3.50 is superior to
$1.57.  The primary barriers to our offer are those that result
from your illegal actions and are barriers that you can remove.

"4. OMNICARE HAS ALSO MADE A "SUPERIOR" MERGER PROPOSAL.

"As an alternative to our tender offer, Omnicare also has made a
bona fide proposal in writing to acquire the Shares for $3.50
per share in cash in a negotiated merger transaction.  Although
this proposal (like Omnicare's tender offer) provides
significantly greater value to NCS stakeholders than the
proposed NCS/Genesis transaction, NCS HAS AGAIN IGNORED
OMNICARE.

"In a letter to you, dated August 15, 2002, we agreed to execute
a merger agreement substantially identical to the NCS/Genesis
Merger Agreement.  Unlike the alleged NCS/Genesis Merger
Agreement, however, our proposed agreement does not include a
"break-up" fee and other provisions intended to preclude a
superior proposal.  It specifically gives you a "fiduciary-out,"
which enables you to terminate the NCS/Omnicare Merger Agreement
if a superior offer should emerge.

"5. OMNICARE'S MERGER PROPOSAL IS NOT CONDITIONED ON DUE
    DILIGENCE.

"As is the case with our tender offer, Omnicare's merger
proposal is not conditioned on due diligence.  Omnicare is
willing to execute the NCS/Omnicare Merger Agreement, and our
agreement contains no conditions other than those already agreed
to by NCS in the NCS/Genesis Merger Agreement.

"In our efforts to negotiate a transaction with NCS for almost a
year, we have, like all buyers in a negotiated transaction,
including Genesis, requested confirmatory due diligence
materials from NCS.  This request was not only standard and
customary, but was, in fact, invited by NCS.  We assume that
Genesis was given access to all of the due diligence materials
that it requested from NCS.

"To avoid any doubt on your part, we reiterate that Omnicare
does not require any period of due diligence before purchasing
Shares in its tender offer (as is clear on the face of our Offer
to Purchase) or executing the NCS/Omnicare Merger Agreement.
Neither our tender offer nor the proposed merger is subject to a
due diligence condition.

"6. NCS BONDHOLDERS AND OTHER CREDITORS WILL RECEIVE
    EQUAL TREATMENT.

"You also claim that our tender offer does not contain a binding
commitment to provide full and complete recovery to the
creditors of NCS.  This statement is false.  We have committed
publicly, on several occasions, that, in the case of our tender
offer and our merger proposal, NCS bondholders and other
creditors would be treated exactly the same as they are proposed
to be treated in the NCS/Genesis transaction.  This claim is
merely another poor attempt to move the focus from the real
issues - Omnicare's offer is superior to the proposed
NCS/Genesis transaction and you have breached your fiduciary
duties by not even discussing our demonstrated interest or
negotiating with us.

"7. OMNICARE IS WILLING TO DISCUSS ALL ASPECTS OF ITS
    SUPERIOR OFFER.

"You also claim that Omnicare's offer does not provide NCS
stockholders with the opportunity to participate in any long-
term appreciation in the value of Omnicare's stock.  As detailed
below, Omnicare's offer provides NCS stockholders with
significantly greater value than the proposed NCS/Genesis
transaction.  In addition, we have stated publicly, on several
occasions, that we are willing to discuss all aspects of our
tender offer and merger proposal, including structure, price and
form of consideration.

"We reiterate our willingness to discuss all aspects of our
offer, including structure, price and the form of consideration
to be paid to NCS stakeholders in a transaction with Omnicare.

"We, again, point out that Omnicare's fully financed, all-cash
offer represents more than twice the value of the proposed
NCS/Genesis transaction and is nearly five times the value of
NCS's closing stock price of $0.74 on July 26, 2002 (the last
trading day before Omnicare publicly announced its acquisition
proposal and before NCS announced its proposed transaction with
Genesis).  Based on yesterday's closing stock prices, the value
of the Genesis offer is approximately 27% below the value of NCS
common stock.  In addition, as detailed above, we have committed
to treating NCS bondholders and other NCS creditors exactly the
same as they are proposed to be treated in the NCS/Genesis
transaction, and we are willing to execute the NCS/Omnicare
Merger Agreement (which is more favorable to NCS than the
NCS/Genesis Merger Agreement that was approved by you).

"Pursuant to the terms of the NCS/Genesis Merger Agreement, you
are permitted to consider a "Superior Proposal."  We cannot
understand how, in light of the foregoing, the NCS Board could,
in a manner that is consistent with the discharge of its
fiduciary duties, refuse to declare Omnicare's offer a "Superior
Proposal" under the NCS/Genesis Merger Agreement.  If Omnicare's
offer, which provides significantly greater value for NCS
stockholders is not a "Superior Proposal," the provision in the
NCS/Genesis Merger Agreement permitting the NCS Board to
consider other proposals is meaningless.

"Omnicare is committed to completing a transaction with NCS.  We
have attempted to negotiate a transaction with NCS for more than
a year.  Prior to executing the NCS/Genesis Merger Agreement,
you were aware of Omnicare's clearly superior proposal.  You
chose, for reasons that obviously have nothing to do with
delivering value to NCS stockholders, to accept a significantly
lower value transaction with Genesis.  You should be honest with
your stockholders.

                         *    *    *    *

"We would prefer to discuss these matters directly with you and
not engage in record-creating letter writing exercises and
litigation.  However, until you are willing to deal directly
with us, we are compelled to use these means to explain
ourselves to you and your stockholders."

Sincerely,

Joel F. Gemunder
President and Chief Executive Officer

Dewey Ballantine LLP is acting as legal counsel to Omnicare and
Merrill Lynch is acting as financial advisor.  Innisfree M&A
Incorporated is acting as Information Agent.

Omnicare, based in Covington, Kentucky, is a leading provider of
pharmaceutical care for the elderly. Omnicare serves
approximately 738,000 residents in long-term care facilities in
45 states, making it the nation's largest provider of
professional pharmacy, related consulting and data management
services for skilled nursing, assisted living and other
institutional healthcare providers. Omnicare also provides
clinical research services for the pharmaceutical and
biotechnology industries in 28 countries worldwide. For more
information, visit the company's Web site at
http://www.omnicare.com

                         *    *    *

As of June 30, 2002, NCS Healthcare's balance sheet shows a
total shareholders' equity deficit of about $108 million.


NESTOR INC: Needs to Seek New Financing to Continue Operations
--------------------------------------------------------------
Nestor, Inc., organized two wholly-owned subsidiaries, Nestor
Traffic Systems, Inc., and Nestor Interactive, Inc., effective
January 1, 1997.  Effective November 7, 1998, the Company ceased
further investment in the Interactive subsidiary. In 1999 and
2000, NTS sold shares of its common stock to private investors,
bringing the Company's ownership of NTS to 34.62%. On September
12, 2001, NTS was merged into a wholly owned subsidiary of the
Company. Accordingly, its consolidated financial statements
include NTS balance sheet accounts at December 31, 2001 and June
30, 2002, and operating results for the period from September
13, 2001 through year end and for the quarter and six months
ended June 30, 2002. All intercompany transactions and balances
have been eliminated.

On May 18, 2001, Nestor, Inc., ceased direct product
development, sales and support in the fields of fraud detection,
financial risk management, and customer relationship management.
Through  license agreements entered into with Applied
Communications, Inc., on February 1, 2001, and with Retail
Decisions, Inc., on May 18, 2001, co-exclusive development,
licensing and support  rights were granted to these resellers in
fraud and risk management; and non-exclusive rights in the field
of CRM were granted to ReD. Nestor continues to receive
royalties from ACI licensing revenues realized from licensing of
the Company's products. In addition, all expenses associated
with development, support and selling these products were
transferred to these parties.

The Company is currently expending cash in excess of cash
generated from operations, as revenues are not yet sufficient to
support future operations. These conditions raise substantial
doubt about the Company's ability to continue as a going concern
without additional financing. On July 15, 2002, the Company
entered into a Memorandum of Understanding, assigning certain of
the Company's rights to ACI royalty income in exchange for
$3,100,000 in cash. The Memorandum also provides a schedule for
advances of up to $1,300,000 to provide interim financing to the
Company prior to the closing. This funding will be adequate to
support the Company's operating expenses through the remainder
of the year.

The Company had consolidated cash and cash equivalents of
approximately $2,295,000 at December 31, 2001 which were fully
expended by June 30, 2002. The Company had restricted cash of
approximately $122,000 at June 30, 2002, and $944,000 at
December 31, 2001. At June 30, 2002, the Company had a working
capital deficit of $2,239,000 as compared with working capital
of $1,853,000 at December 31, 2001. During the period July 1
through August 14, 2002, the Company has received $740,000 in
advances towards the purchase of ACI royalty  rights pursuant to
the Memorandum of Understanding.

The Company's net worth at June 30, 2002 was $8,310,000, as
compared with a net worth of $16,392,000 at December 31, 2001.
The decrease in net worth results primarily from the net
operating loss reported in the current period including the
write-down of goodwill and certain capitalized system costs, as
well as recorded restructuring costs.

Additional capital will be required to enable the Company to
carry out product delivery efforts under current contracts, to
underwrite the delivery costs of future systems delivered under
turnkey agreements with municipalities, for continued
development and upgrading of its products, for customer support,
and for other operating uses. If the Company does not realize
additional equity and/or debt capital and revenues sufficient to
maintain its operations at the current level, management of the
Company would be required to modify certain initiatives
including the cessation of some or all of its operating
activities until additional funds become available through
investment or revenues.

As of June 30, 2002, the Company had 111 CrossingGuard
approaches under contract, of which 74 approaches were in
various stages of analysis and delivery. To complete these
approaches, the Company will be required to raise additional
capital to cover the equipment, construction and delivery costs.

The Company has retained investment advisors and is actively
pursuing the raising of additional capital. The possible success
of these efforts, and the effect of any new capital on the
current structure of the Company, cannot be determined at this
time.


NORTEL NETWORKS: Takes Action to Lower Breakeven Cost Structure
---------------------------------------------------------------
Nortel Networks Corporation (NYSE:NT)(TSX:NT.) expects revenues
from continuing operations for the third quarter of 2002 to be
lower than its previously stated guidance, primarily due to
further reductions in spending by service providers in the
United States.

In light of the additional pressure on spending in the near
term, and the continuing expectation for ongoing pressure on
customer capital spending well into 2003, the Company is also
taking additional actions to lower its quarterly breakeven cost
structure.

"We continue to see reductions in near term spending plans by
service providers especially in the United States," said Frank
Dunn, president and chief executive officer, Nortel Networks.
"Despite the reduction in capital spending and revenues, we
continue to expect ongoing sequential pro forma(a) bottom line
improvement in the third quarter and fourth quarters of 2002,
reflecting the impact of our ongoing restructuring activities.
We now expect revenues from continuing operations in the third
quarter of 2002 to be lower than second quarter 2002 revenues by
up to approximately 10%, compared to our previous view of
'essentially flat'."

Dunn continued, "Our top priority remains to return to
profitability by the end of June 2003. In our drive to achieve
this goal, and in light of the ongoing pressure on customer
capital spending plans globally, we are taking steps to further
reduce our quarterly breakeven cost structure (not including
costs related to acquisitions and any special charges or gains)
to below US$2.6 billion. This compares to our previously stated
quarterly breakeven cost structure, on the same basis, of
approximately US$3.2 billion. Our focus will be on simplifying
the structure around our three businesses and ensuring that a
more direct connection exists between our operations and
customer facing teams. This approach will allow us to be even
more responsive to our customers' needs, while reducing our cost
structure."

"We are making excellent progress with our customer engagement
and the development and deployment of our leadership portfolio.
However, the market environment continues to be challenging with
lower spending levels than previously expected and a more
prolonged industry transition. While we continue to align our
business to this environment, we remain committed to our
previously stated priorities to:

     --  return to profitability in the near term;

     --  focus on providing quality solutions that meet our
         enterprise and service provider customer needs; and

     --  drive for market leadership through technology
         innovation," concluded Dunn.

These actions will result in additional charges associated with
workforce reductions and related facilities closures and
streamlining activities. Although the plans and associated costs
are in the process of being finalized (and will be provided as
part of the Company's third quarter 2002 results), the Company
noted that it has sufficient liquidity to fund both these
actions and its operations, without utilizing its bank
facilities (all of which remain available and undrawn).

The Company expects the restructuring activities to be
substantially completed by end of the fourth quarter of 2002.
When ultimately completed, the Company expects a workforce of
approximately 35,000.

Nortel Networks is an industry leader and innovator focused on
transforming how the world communicates and exchanges
information. The company is supplying its service provider and
enterprise customers with communications technology and
infrastructure to enable value-added IP data, voice and
multimedia services spanning Metro and Enterprise Networks,
Wireless Networks and Optical Networks. As a global company,
Nortel Networks does business in more than 150 countries. More
information about Nortel Networks can be found on the Web at
http://www.nortelnetworks.com

Nortel Networks Ltd.'s 6.125% bonds due 2006 (NT06CAN1),
DebtTraders says, are trading at 55 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=NT06CAN1for
real-time bond pricing.


POLAROID: Unsecured Creditors to be Paid with Purchaser's Shares
----------------------------------------------------------------
The Official Committee of Unsecured Creditors of the former
Polaroid Corporation issues this release for the purpose of
clarifying issues of relevance to the unsecured creditors of Old
Polaroid relating to the recent sale of Old Polaroid's assets
and the distribution of sale proceeds.  As previously announced,
on July 31, 2002, Old Polaroid sold substantially all of its
assets to OEP Imaging Corporation, an affiliate of One Equity
Partners, the private equity arm of Chicago-based Bank One,
creating a new company that will operate under the Polaroid
Corporation name, which was purchased along with the other
intangible assets in the transaction.

As part of the sale, which was conducted with the approval of
the U. S. Bankruptcy Court as part of Old Polaroid's pending
bankruptcy proceedings, in addition to the $255 million cash
consideration paid by OEPIC, a substantial portion of which was
financed with cash on hand, Old Polaroid also received 35
percent of the outstanding shares of capital stock of OEPIC.

According to representatives of the Official Committee, of the
cash received by Old Polaroid, plus cash on hand, $228.0 million
was paid to Old Polaroid's pre-petition secured lenders in
satisfaction of their claims against the company, approximately
$8.3 million was used to pay or provide for the payment of
certain non-assumed liabilities, approximately $4.7 million was
reserved for the payment of various foreign and domestic taxes,
and approximately $14.0 million was reserved for the payment of
various claims against the Old Polaroid bankruptcy estate and
the costs and expenses incurred in connection with the final
wind-down of Old Polaroid.  Certain segregated funds may be
refunded or returned to Old Polaroid pending the final
resolution of various other tax and related business issues.

Representatives of the Official Committee announced that the
holders of allowed claims against Old Polaroid will be paid in
strict compliance with the priority rules established under the
U.S. Bankruptcy Code, with creditors that hold secured claims,
priority claims and administrative claims incurred in the
ordinary course of Old Polaroid's business after it filed for
bankruptcy protection paid first, followed by the payment of the
allowed claims of general unsecured creditors.

According to representatives of the Official Committee, it is
anticipated that Old Polaroid will have sufficient cash
resources to pay all of its secured claims, priority claims and
administrative claims.  However, representatives of the Official
Committee indicated that, if the amount of such claims exceeds
the cash currently in Old Polaroid's estate, OEPIC and Old
Polaroid's pre-petition secured lenders have agreed to
contribute up to an additional $10 million in the aggregate to
Old Polaroid for use in satisfying any such excess claims.

If, after the contribution and application of the additional $10
million in funds to be furnished by OEPIC and Old Polaroid's
pre-petition secured lenders, Old Polaroid does not have
sufficient cash resources to pay all of its allowed secured
claims, priority claims and administrative claims, Old Polaroid
has the right to sell to OEPIC up to 4 percent of the capital
stock of OEPIC that it received in connection with the sale of
its assets, for a purchase price up to $4.5 million depending on
the amount of such capital stock sold to OEPIC.  According to
the Official Committee, the funds received by Old Polaroid from
OEPIC as part of any such sale of stock would then be used by
Old Polaroid to pay any such excess claims.  In the unlikely
event that, after application of all such proceeds, there still
remain unpaid allowed secured, priority or administrative
claims, which are unforeseen, further portions of the capital
stock of OEPIC that Old Polaroid received in connection with the
sale of its assets will have to be applied to such excess
claims.

A spokesman for the Official Committee indicated that, subject
to the payment of all allowed secured, priority and
administrative claims against the Old Polaroid bankruptcy
estate, it is anticipated that, in the summer of 2003, Old
Polaroid will distribute all of the shares of capital stock of
OEPIC that it then holds to the holders of allowed general
unsecured claims against Old Polaroid, in final satisfaction of
all such claims.  Equity holders of Old Polaroid are not
expected to obtain any recovery on account of their interests in
Old Polaroid's capital stock.

Houlihan Lokey Howard & Zukin is an international investment
bank established in 1970 and headquartered in Los Angeles. The
firm provides a wide range of services, including mergers and
acquisitions, financing, corporate alliances, financial opinions
and advisory services, financial restructuring and merchant
banking. Houlihan Lokey has ranked among the top 20 M&A advisors
in the U.S. for the past 10 years, and its financial
restructuring practice is the largest in the world. The firm has
over 500 employees in North America and Europe. It annually
serves more than 1,000 clients ranging from closely held,
middle-market companies to Fortune 500 and FTSE Eurotop 300
corporations. For more information, visit Houlihan Lokey's Web
site at http://www.hlhz.com

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technology.  For additional information, please visit its Web
site at http://www.akingump.com


QUANTUM CORP: S&P Puts BB Corp. Credit Rating on Watch Negative
---------------------------------------------------------------
Standard & Poor's Ratings Services placed its double-'B'
corporate credit rating and single-'B'-plus subordinated debt
ratings on tape-based enterprise storage company, Quantum Corp.,
on CreditWatch with negative implications. The action is results
from weakened operating performance. Quantum, based in Milpitas,
Calif., had $390 million of debt outstanding as of June 30,
2002.

"Quantum's operating performance reflects the ongoing slump in
spending by enterprise customers on information technology.
Revenues of $211 million in the quarter ended June 30, 2002
declined 13% sequentially. Despite being at the beginning of a
positive product cycle, Quantum is suffering from weak volume
demand, pricing pressure in certain product areas, and increased
tape media inventories in the channel," said Standard & Poor's
credit analyst Joshua Davis.

Standard & Poor's will meet with management to discuss industry
conditions, the company's restructuring initiatives, and the
prospect for restoring and sustaining profitability. A review of
the rating will follow.


QWEST COMMS: Weak Operations Spur S&P to Ratchet Rating to B-
-------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on diversified telecommunications provider Qwest
Communications International Inc., to single-'B'-minus from
single-'B'-plus based the company's weakened operations, a
result of lower than expected performance for its telephone
operations in the second quarter of 2002.

At the same time, the CreditWatch implications were revised to
negative from developing. As of June 30, 2002, Denver, Colorado-
based Qwest had about $26 billion of consolidated debt
outstanding.

"Qwest's EBITDA declined 33% sequentially in the second quarter
of 2002 due to a number of factors, including heightened
competition and a continued weak economy," Standard & Poor's
credit analyst Catherine Cosentino said. "Because of its
weakened operations, the company revised its operating cash flow
guidance for 2002 to between $5.4 billion and $5.6 billion from
the previous guidance of between $6.4 billion and $6.6 billion.
This was the second revision of guidance for 2002, from the
initial guidance of between $7.1 billon and $7.3 billion given
in December 2001."

Standard & Poor's said the lower cash flow expectations for 2002
are also attributable to Qwest's continued relatively high cost
structure, despite cost reduction measures implemented in the
first half of 2002. It said this cost structure was designed for
a much higher level of revenue and concomitant operating cash
flow than has materialized. Moreover, performance for the data
and IP services business was particularly disappointing for the
first half of 2002.

Given current performance expectations, the company anticipates
being out of compliance with the third quarter 4.25 times debt-
to-EBITDA test under the bank facility at Qwest Capital Funding
Inc., absent receipt of amendments or waivers from the banks.
The company is in negotiations with its bank group to amend its
bank facility, including the financial covenants and maturity.
In conjunction with these amendments, Qwest has stated that it
is seeking a senior secured bank facility of $500 million or
more at its directories subsidiary to increase liquidity, the
receipt of which is contingent on receipt of the amendments for
the existing credit facility. In addition, the changes to the
facility are subject to 100% agreement by the bank syndicate.

Although the recently announced agreement for the two-stage sale
of the company's directories business for $7.05 billion is a
positive development, the negative CreditWatch listing reflects
significant concern about future operating performance, as well
as the potential for restructuring the public debt. Qwest's
inability to obtain amendments or waivers to its bank facility
before the end of September 2002 could lead to a further
downgrade.

Qwest Corp.'s 7.625% bonds due 2003 (QUS03USS9), DebtTraders
reports, are trading at 91 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=QUS03USS9for
real-time bond pricing.


RELIANCE INSURANCE: Liquidator Sells Brazilian Unit for $3.5MM
--------------------------------------------------------------
M. Diane Koken, Pennsylvania Insurance Commissioner and
Liquidator of Reliance Insurance Company, has sold Reliance
National Brasil Seguros, S.A. to QBE Insurance Corporation for
$3,525,000.

Reliance National Brasil Seguros is a wholly owned subsidiary of
Reliance National Insurance Ltd., which is in turn owned by RIC.
In July 1999, RIC acquired RNBS for nominal consideration.  RNBS
joined a network of RIC subsidiaries in Latin America that
included operations in Argentina and Mexico.  Due to
underwriting losses, in December 1999, RIC was forced to infuse
$5,000,000 in capital into RNBS to stabilize the subsidiary.
After the infusion, RNBS continued to incur substantial
underwriting losses.  In late 2000, RIC decided to sell all of
its Latin American subsidiaries, including RNBS.

RIC contacted nine insurance and reinsurance companies to
solicit interest in RNBS:

      1) ITAU Insurance-Brasil;
      2) W.R. Berkley & Co.;
      3) Travelers Insurance Company;
      4) Cologne/ Gen Re Brasil;
      5) Claredon Insurance Company;
      6) GE Capital;
      7) Fortis/American Bankers;
      8) The Hartford Insurance Group; and
      9) Mony Inc.

None submitted a bid or expressed significant interest.

RIC's auditors and attorneys, KPMG-Brasil and Demarest &
Almedia, also tried to solicit offers from potential purchasers.
But they were also unsuccessful.  According to Ms. Koken, the
potential purchasers offered several reasons for their lack of
interest including:

      a) RNBS' limited distribution channels;

      b) RNBS' immature portfolio;

      c) the lack of any "Reliance" trademark value;

      d) concern over the Brazilian economy and uncertainty
         about the potential of the Brazilian government to
         devalue its currency;

      e) the ability of the potential purchasers to acquire a
         new license cheaply in Brazil; and

      f) the high expense structure in place at RNBS due to its
         start-up nature.

In late 2000, RIC contacted QBE to gauge its interest in buying
RIC's subsidiaries in Latin and South America.  QBE had
expressed an interest in expanding its business into those
regions.  In early 2001, RIC and QBE negotiated a letter of
intent for the purchase of RIC's Latin and South American
subsidiaries.  The parties commenced due diligence.  On June 14,
2001, QBE agreed to purchase RNBS and Reliance Mexico for 65% of
their respective net asset values.  It would be financed with
70% cash and 30% in the form of a note.

The sale under these terms did not materialize due to a failed
condition precedent.  However, QBE continued to express interest
in RNBS.  Under the terms, QBE would pay $3,055,000 in cash,
which was 65% of net asset value, with 70% cash and 30% being a
note holdback.

The Investment Committee and operating management of RIC
rejected this offer.  It countered with an offer to sell RNBS
for 75% of the net asset value, amounting to $3,525,000, with no
holdback and indemnification capped at $1,000,000.  QBE accepted
this offer.

RIC is required to indemnify QBE for:

1) The amount of any adverse reserve development, which is the
   sum of net combined loss reserves excluding unallocated loss
   adjustment expenses, reinsurance recoveries received or
   claimed and recoverable by RNBS, reinsurance commutations
   received by RNBS during the indemnity period, and recoveries
   by RNBS under salvage, subrogation or other rights less the
   sum of gross losses and loss adjustment expenses paid during
   the indemnity period and net combined loss reserves;

2) Unrecoverable reinsurance claims;

3) Labor litigation arising under employment, compensation,
   incentive, bonus, pension, retirement, benefit or similar
   agreements of arrangements to which RNBS is a party; and

4) Tax litigation, administrative actions and proceedings with
   respect to RNBS to the extent aggregate damages exceed the
   established reserves.

The transaction received local regulatory approval in Brazil.
In the filing with the Commonwealth Court, Ms. Koken emphasized
that time was of the essence.  If losses continued, RNBS could
have been placed under control of the governing insurance
regulatory agency in Brazil.  This risk was heightened by the
fact that RIC could not infuse any more capital into its
subsidiary to offset the operating losses.

The Liquidator told the Commonwealth Court that the QBE offer
was likely the only one it expected to receive.  The Liquidator
reminded the Court that all previous efforts to market RNBS
failed, even though the potential purchasers had existing
business within the Brazilian insurance market.  Ms. Koken
further relates the Court that RNBS experienced underwriting
losses for the last four years.  Its expense ratios "have been
dismal due to its start-up nature and the resultant inability to
spread its expenses."  For example, in the first nine months of
2001, RNBS produced a net loss of $800,000.  Additionally, the
adverse economic conditions in Brazil portend a continued slump
for its insurance industry, causing RNBS' market value to likely
decline in the future. (Reliance Bankruptcy News, Issue No. 28;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


ROCKWELL MEDICAL: Auditors Express Going Concern Doubt
------------------------------------------------------
Rockwell Medical Technologies, Inc., manufactures, sells and
distributes hemodialysis concentrates and other ancillary
medical products and supplies used in the treatment of patients
with End Stage Renal Disease "ESRD". The Company supplies
medical service providers who treat patients with kidney
disease. The Company's products are used to cleanse patients'
blood and replace nutrients lost during the kidney dialysis
process. The Company primarily sells its products in the United
States.

Rockwell Medical is regulated by the Federal Food and Drug
Administration under the Federal Drug and Cosmetics Act, as well
as by other federal, state and local agencies. The Company has
received 510(k) approval from the FDA to market hemodialysis
solutions and powders. The Company also has 510(k) approval to
sell its Dri-Sate Dry Acid Concentrate product line and its Dri-
Sate Mixer.

Sales in the second quarter of 2002 were $2,562,594 and were
17.9% higher than the second quarter of 2001. Unit volume growth
in the Company's concentrate product lines accounted for the
majority of the revenue increase in the second quarter of 2002.
Acid concentrate sales increased 15% while sales of bicarbonate
products were up 12% in the second quarter of 2002 compared to
the second quarter of 2001. Ancillary sales growth increased
substantially in the second quarter of 2002 with the majority
due to new products including blood tubing and a new line of
fistula needles which were first introduced by the Company
during the first quarter of 2002. Growth in ancillary products
represented about 22% of the Company's growth in the second
quarter of 2002 compared to the second quarter of 2001. Freight
revenue remained at approximately the same level as the second
quarter of 2001 despite higher utilization of the Company's
truck fleet for delivery of the Company's products reducing
their availability for backhaul revenue.

Gross profit in the second quarter was $264,100 and was at
approximately the same level as the second quarter of 2001.
During 2001, the Company increased its productive capacity with
the addition of new manufacturing equipment and two new
manufacturing facilities. These two new facilities, each in
excess of 51,000 square feet replaced the Company's previous
facility which was under 35,000 square feet. As a result of
these changes the Company's overall operating costs were
increased. These increased costs have been partially offset by
increased revenue. The Company's gross profit margins decreased
1.6 percentage points to 10.3% in the second quarter of 2002 as
compared to the same quarter in 2001. The Company believes that
the new equipment, the new facilities and improved proximity to
customers will increase its efficiency and gross profit margins
in the future. In addition, the Company anticipates that gross
profit margins will improve to the extent the Company's sales
volumes increase.

Net Loss aggregated $378,798 which was higher than the year
earlier quarter by $23,052 primarily due to a $50,000 expense in
the second quarter of 2002 related to settlement of claims for a
leased facility it exited in the second quarter of 2001. Loss
per share of $.05 per share in the second quarter of 2002 was
$.01 lower than the second quarter of 2001 with all of the
improvement due to an increase in the number of common shares
outstanding.

Sales for the first six months of 2002 were $5,007,924 and
increased 13.2% over the first half of 2001. Increased sales
volumes of the Company's concentrate product lines were the
primary drivers generating the overall sales improvement.
Similarly, the Company's ancillary product sales increased
substantially with new product sales for blood tubing and
fistula needles generating the majority of the ancillary sales
growth. The Company's freight revenue for the six month period
declined approximately $16,000 due to increased utilization of
its truck fleet in making deliveries of the Company's products
as compared to performing as common carriers.

The Company realized increases in all of its product lines with
a 16% increase in acid concentrate sales in the first half of
2002 as compared to the first half of 2001. In addition,
bicarbonate product line sales increased 7.6% over the first
half of 2001 with strong sales of the Company's SteriLyte(TM)
Liquid Bicarbonate contributing more than half of the
bicarbonate product sales growth as a result of a 60% unit
volume increase. Overall, bicarbonate powder sales growth
comparisons over the prior year were affected by a substantial
order from a competitor in the first half of 2001 which did not
recur.

In comparison with the first half of 2001, the Company realized
substantial growth in its ancillary products business with
ancillary product sales up over 19% with the majority of the
increase due to sales from new product lines. During the first
half of 2002, the Company introduced blood tubing into its
product offering and a new line of fistula needles. These new
products were the catalyst behind the majority of the increase
in ancillary sales.

Gross profit margins decreased by 2.2% of sales from the first
half of 2001, largely as a result of adding additional plant
capacity to support anticipated growth in the Company's dialysis
concentrate powder product lines. In July of 2001, the Company
relocated its Midwest facility to a new 52,000 square foot
manufacturing facility in Wixom, Michigan. During the third
quarter of 2001, the Company commenced operations in its
Grapevine, Texas facility. Increased costs for these facilities
were partially offset by additional revenue. However, gross
profit decreased by $42,900 as compared to the first half of
2001 largely due to higher operating costs for the new
facilities including depreciation which increased $86,000 over
the first half of 2002. The Company installed new production
equipment in both facilities during the first quarter of 2002
that it believes will provide it with the productive capacity to
efficiently process increased sales volumes and increase
manufacturing efficiency in the future. In addition, the Company
anticipates that gross profit margins will improve to the extent
the Company's sales volumes increase.

Net Loss aggregated $725,012 which was higher than the first six
months of 2002 by $83,600. Loss per share of $.10 per share in
the first six months of 2002 was $.02 lower per share than the
$.12 per share loss in the first half of 2001. Reported loss per
share in the first six months of 2002 would have been $.03 per
share higher without an increase in the number of common shares
outstanding.

                  Liquidity and Capital Resources

The Company has utilized cash since its inception and
anticipates that it will require additional cash to fund its
development and operating requirements. The Company has incurred
operating losses since inception. During the first half of 2002,
the Company raised net equity funding aggregating $1,110,000.
The Company anticipates that it will continue to require cash to
fund its operations and develop its business. In addition, the
Company has commenced several strategic initiatives that will
require additional capital resources.

Rockwell Medical's long term strategy is to expand its
operations to serve dialysis providers both in North America and
abroad. The Company believes that it has sufficient
manufacturing capacity to achieve a profitable level of
operations. The Company believes that it may be able to expand
existing customer relationships to a level where it may become
profitable.

In order to fund the working capital and capital expenditure
requirements to achieve a profitable level of operations and to
continue to execute its new product development strategy, the
Company will require additional financing. The Company recently
obtained the global rights covering patents related to the
delivery of water soluble iron in its dialysate products. The
Company is seeking FDA approval for these products which will
include clinical trials. The Company estimates the cost to fund
its new product development efforts will be between $2,000,000-
$3,000,000 over the next 1-3 years. The Company is attempting to
raise the capital required to fund these strategic initiatives
and to expand its operations through either debt or equity
financing arrangements. The Company has identified potential
sources of financing and is currently in negotiations with
potential lenders and investors; however, there can be no
assurance that the Company will be successful in raising
additional funds through either equity or debt financing
arrangements. If the Company is not successful in raising
sufficient funds, its ability to continue these product
development efforts and to reach a profitable level of
operations will be jeopardized.

In 2001, the Company entered into a working capital line with
Heller Healthcare Finance, now "GE Healthcare Finance" for a $2
million working capital line of credit secured by the Company's
accounts receivable and other assets. The working capital line
has a sub-limit of $1 million and is expandable to $2 million.
As of June 30, 2002, the Company had outstanding borrowings of
$780,570 under this line of credit.

In 2001, the Company entered into a $1 million note payable with
GE Healthcare Finance for the purchase of equipment for its two
new manufacturing facilities. During the first quarter of 2002,
the Company completed its capital spending plan to upgrade its
new plants funded by the proceeds from this note payable. The
Company does not currently have plans for any additional
material plant capital spending for production equipment.

During the first half of 2002, Rockwell Medical had received
equity funding of approximately $1,110,000. In addition, the
Company is currently in negotiation with potential lenders and
investors with respect to additional funding.

There can be no assurance that the Company will be able to
achieve the planned efficiencies and increase its sales levels
and market share to sustain its operations. There can be no
assurance that the Company has sufficient funds should the
business plans not yield the expected results. These factors,
among others, raise substantial doubt about the Company's
ability to continue as a going concern.


TEMPLETON EMERGING: Shareholders Approve Plan of Liquidation
------------------------------------------------------------
Templeton Emerging Markets Appreciation Fund, Inc. (NYSE:TEA), a
closed-end management investment company, announced the final
results of voting at the 2002 Annual Meeting of Shareholders
held on August 26, 2002. Shareholders approved the election of
Directors and also approved an Agreement and Plan of Acquisition
between the Fund and Templeton Developing Markets Trust, a
registered open-end management investment company, that provides
for the acquisition of substantially all of the assets of the
Fund by Developing Markets Trust in exchange solely for shares
of Developing Markets Trust-Advisor Class, the distribution of
these shares to the Fund's shareholders, and the complete
liquidation and dissolution of the Fund.

The transaction, which is expected to be a tax-free
reorganization, currently is anticipated to become effective on
or about September 26, 2002, or such later date as may be
determined by the Fund and Developing Markets Trust. As set
forth in the Plan of Acquisition, shareholders will receive
shares of Developing Markets Trust-Advisor Class having the same
aggregate net asset value as their shares of the Fund. The
exchange of shares will be based on each fund's relative net
asset value per share as of the close of business on the Closing
Date. For the six months after the reorganization, former Fund
shareholders who redeem Advisor Class shares of Developing
Markets Trust received in the reorganization, will pay a 2%
redemption fee. Fund shareholders will receive written materials
that will provide detailed information about the exchange.

The Fund also announced its final distribution from net
investment income of $0.2500 per share, payable on September 13,
2002 to shareholders of record on September 6, 2002 (Ex-Dividend
Date: September 4, 2002). A portion of this distribution may be
reclassified as a nontaxable distribution (return-of-capital)
for tax purposes. In January 2003, shareholders will receive
Form 1099-DIV which will report the amount and character of the
Fund's distributions paid in calendar year 2002.

The Fund's investment adviser is Templeton Asset Management
Ltd., an indirect wholly owned subsidiary of Franklin Resources,
Inc. (NYSE:BEN), a global investment organization operating as
Franklin Templeton Investments. Franklin Templeton Investments
provides global and domestic investment management services
through its Franklin, Templeton, Mutual Series and Fiduciary
Trust subsidiaries. The San Mateo, CA-based company has over 50
years of investment experience and more than $257 billion in
assets under management as of July 31, 2002. For more
information, please call 1-800/DIAL BEN(R) (1-800-342-5236).


TEXFI: Trustee Hires Silverman Perlstein as Avoidance Counsel
-------------------------------------------------------------
Stephen S. Gray, the Chapter 11 Trustee of Texfi Industries,
Inc.'s bankruptcy estate, obtained authority from the U.S.
Bankruptcy Court for the Southern District of New York to retain
Silverman Perlstein & Acampora, LLP, nunc pro tunc to July 30,
2002, as his special avoidance claims counsel in this Chapter 11
case.

Silverman Perlstein will assist the Trustee, without limitation,
in:

     a) pursuing all avoidance actions on behalf of the Trustee
        and the estate under Bankruptcy Code Sections 544, 547,
        and 549;

     b) taking necessary action to protect and preserve the
        Debtor's estate, as directed by the Trustee, including
        the prosecution of avoidance actions on behalf of the
        Debtor and negotiations concerning the avoidance claims;

     c) furnishing certain information requested by parties-in-
        interest;

     d) representing the Trustee in any bankruptcy proceedings
        initiated by the parties receiving the avoidance
        transfers; and

     e) rendering such other legal services to the Trustee as
        may be necessary and appropriate in these proceedings.

Silverman Perlstein will charge for its legal services at its
customary and usual hourly rates:

          partners           $240 to $425
          associates         $150 to $235

The Trustee anticipates that the blended hourly rate for
Silverman Perlstein's services will approximate $240 per hour.

Texfi Industries, Inc., filed for chapter 11 protection on
February 15, 2000.  Barbra R. Parlin, Esq., and David Craig
Albalah, Esq., at McDermott, Will & Emery represent the Debtor
in its restructuring efforts. Joel H. Levitin, Esq., and Stephen
J. Gordon, Esq., at Dechert serve as counsel for the Chapter 11
Trustee.


TRAVEL SERVICES: Court Sets Sept. 3 Deadline for Admin. Claims
--------------------------------------------------------------
               UNITED STATES BANKRUPTCY COURT
               SOUTHERN DISTRICT OF NEW YORK

   In re                           ) Chapter 11
   TRAVEL SERVICES, INC., et al.,  ) Case No. 02-10509 (REG)
                 Debtors.          ) (Jointly Administered)

            NOTICE OF DEADLINE FOR REQUESTS FOR
      THE ALLOWANCE OF ADMINISTRATIVE EXPENSE CLAIMS

NOTICE IS HEREBY GIVEN THAT:

      1. The Court has established September 3, 2002 at 5:00
p.m. (prevailing New York City Time) as the day and time by
which all persons and entities, including, without limitation,
individuals, partnerships, corporations, estates, trusts and
governmental units, holding Administrative Claims against
Council Travel Services, Inc., Council Travel Services USA,
Inc., or Council Charter, Inc., must file a request for
allowance of Administrative Claim.  For purposes of this Notice,
an "Administrative Claim" is any claim arising on or after
February 5, 2002 with respect to which a holder intends to seek
priority of payment pursuant to sections 503 and 507(a)(1) of
the Bankruptcy Code, except that holders of the following types
of administrative expense claims need not file requests for
allowance of such Administrative Claims by the Administrative
Claims Bar Date: administrative claims of (a) professionals
retained pursuant to section 327 or 328 of the Bankruptcy Code
and (b) all fees payable to unpaid under 28 U.S.C. Sec. 1930.

      2. Any person who asserts an Administrative Claim (arising
on or after February 5, 2002) and wishes to have such
Administrative Claim allowed by the Court and paid by the
Debtors must file a request for allowance of such Administrative
Claim either by mail to:

       United States Bankruptcy Court
       Southern District of New York
       Re: Travel Services, Inc.,
       P.O. Box 5081
       Bowling Green Station
       New York, NY 1004

Or if delivered in person, by hand delivery or expedited
courier, to:

       Clerk of the United States Bankruptcy Court,
        Southern District of New York
       Re: Travel Services, Inc.,
       One Bowling Green, Room 534,
       New York, NY 1004

All forms must be received by the Administrative Claims Bar
Date. All requests for allowance of Administrative Claims must
be submitted in a form in accordance with the Bankruptcy Code,
the Bankruptcy Rules and the Local Bankruptcy Rules of the
United States Bankruptcy Court of the Southern District of New
York. SHOULD YOU FAIL TO FILE A TIMELY REQUEST FOR ALLOWANCE OF
ADMINISTRATIVE CLAIM, SUCH CLAIM SHALL NOT BE ALLOWED BY THE
COURT OR PAID BY THE DEBTORS.

      3. This is not a Bar Date for the filing of general,
unsecured, non-priority claims, arising before February 5, 2002.

          OLSHAN GRUNDMAN FROME ROSENZWEIG & WOLOSKY LLP
          Attorneys for the Debtors
          Schuyler G. Carroll, Esq.
          505 Park Avenue
          New York, New York 10022
          (212) 753-7200


TRI UNION DEVELOPMENT: Auditors Raise Going Concern Doubt
---------------------------------------------------------
Tri-Union Development Corporation, successor to Tribo Petroleum
Corporation, was incorporated in the State of Texas in September
1992. The Company, with its subsidiary, is an independent oil
and natural gas company engaged in the acquisition, operation
and development of oil and natural gas properties primarily in
areas of Texas and Louisiana, offshore in the shallow waters of
the Gulf of Mexico, and in the Sacramento Basin of northern
California.  Prior to July 2001, the Company was a wholly owned
subsidiary of Tribo. In July 2001, the Company and Tribo merged
and the surviving corporation was the Company.

On June 1, 2002, the Company was required to make a $28,125,000
payment of principle and interest on its senior secured notes,
and an additional scheduled interest payment of approximately
$7,400,000 is due on December 1, 2002. In addition, the Company
has a scheduled principal and interest payment of approximately
$28,700,000 due June 1, 2003. The Company made its scheduled
principal payment of $20,000,000 due on June 1, 2002, but
refinanced its scheduled interest payment of $8,125,000 into
additional promissory notes under the terms of a Waiver,
Agreement and Supplemental Indenture. The Waiver contained
additional covenants, one of which required the Company to
obtain clear title to an oil and gas property subject to lien by
no later than August 2, 2002. As the Company was unable to
obtain clear title by that date, an event of default occurred to
the Waiver and the original Indenture whereby the senior secured
notes became due on demand. While the Company continues to delay
certain of its workover and capital improvement projects in
order to maximize available cash to meet its debt obligations,
the foregoing event of default could considerably impact the
Company's ability to meet its debt and working capital
requirements. Should the noteholders demand payment on the
notes, the Company will not have the ability to generate
sufficient resources to satisfy this obligation. These
conditions raise substantial doubt about the Company's ability
to continue as a going concern.

The Company is considering marketing certain of its oil and gas
properties in order to meet these debt obligations and working
capital requirements. Several offers to purchase certain of the
Company's oil and gas properties have been received to date
which, if accepted, and combined with the Company's cash
balances at August 1, 2002 of approximately $1.0 million, would
provide the Company with sufficient capital to meet its upcoming
December 1, 2002 scheduled debt obligation. However, to date, no
definitive agreement to sell these properties has been secured.

To the extent the cash generated from oil and gas property sales
and continuing operations are insufficient to meet the Company's
scheduled debt obligations and its projected working capital
needs, the Company will have to raise additional capital. No
assurance can be given that additional funding will be
available, or if available, will be on terms acceptable to the
Company. Uncertainty regarding the amount and timing of any
proceeds from the Company's plans to raise additional capital
raises substantial doubt about the Company's ability to continue
as a going concern.

For the three months ended June 30, 2002, consolidated net loss
was $6,693,373 as compared to consolidated net income of
$4,399,933 for the three months ended June 30, 2001.

On July 3, 2002, the Company entered into a Waiver, Agreement
and Supplemental Indenture in which the holders of its senior
secured notes agreed to permit the Company to make the June 1,
2002, accrued cash interest payment due on the Notes, plus
interest due on such interest, through the issuance of
additional promissory notes on terms identical to the terms of
the original notes except with respect to the issuance date and
the aggregate principal amount.  In addition, the New Notes have
not immediately been registered under the Securities Act of 1933
and will not be freely tradable until such time as a
registration statement with respect to the New Notes has been
declared effective by the Securities and Exchange Commission.
The New Notes have been issued under the Indenture as Series A
Notes and as Tack-on Senior Secured Notes, and have an accreted
value of $1,000 per Note. The Company further agreed to issue to
the noteholders pro rata in accordance with their respective
principal amounts of notes held, an aggregate of 76,667 class A
common shares. The value of the additional shares, which has yet
to be determined, will be recorded as debt issuance costs and
amortized using the interest method over the remaining life of
the notes. Additionally, the Company agreed to certain covenants
including the following:

         a)  The Company will not permit Base EBITDA, as
adjusted to exclude the non-cash effects of any oil and natural
gas hedge contracts, for the third fiscal quarter of 2002, to be
less than $4.0 million and, as of the end of each fiscal quarter
thereafter, to be less than Base EBITDA compounded by an
additional 5%. The Company will not permit volumes of average
daily production of oil and natural gas (reported for each
fiscal month) from the oil and gas assets of the Company subject
to the lien of the Indenture to be less that 28.5 Mmcfe per day.

         b)  The Company will subject its entire interest in
certain oil and gas assets located in Grimes County, Texas, to
the lien of the Indenture and the Security Documents no later
than 30 days after the Effective Date of the Agreement.

         c)  On or before the Effective Date, the Company will
take any or all actions required to sever its business
relationships with certain related parties to the extent such
severance can be accomplished in a manner that is not
detrimental to the Company or its subsidiary.

         d)  With respect to the Company's previous Chief
Executive Officer and President, the Company and its subsidiary
will not enter into any severance agreement, or allow the former
to serve as an agent, independent contractor, employee or
consultant without the approval of at least 66-2/3% in principal
amount of the then outstanding notes.

In August, 2002, the Company notified the holders of its senior
secured notes that it did not obtain clear title to the Champion
#1-H well in the 30 day period required pursuant to the Waiver.
The failure to obtain clear title to the Champion #1-H well
constitutes an event of default pursuant to the terms of the
Waiver and the Indenture. If any event of default occurs and not
cured, the noteholders may by notice to the Company, declare all
the notes then outstanding to be due and payable upon demand.
Although no such declaration or demand has been made upon the
Company, the senior secured notes have been classified as
current at June 30, 2002.


UNIROYAL TECHNOLOGY: Court Grants Access to $15MM DIP Financing
---------------------------------------------------------------
Uniroyal Technology Corporation (Nasdaq: UTCI) announced that
the U.S. Bankruptcy Court for the District of Delaware in
Wilmington has approved a series of first-day orders, including
authorizing a debtor-in-possession financing facility of up to
$15 million on an interim basis.

"Our primary commitment is to building a strong and more
competitive organization with a bright future, and we hope the
decision by management to defer its own compensation makes that
message clear," said Uniroyal Chairman and Chief Executive
Officer Howard R. Curd.

In addition to authorizing use of the DIP financing, the Court
also approved first-day orders on Uniroyal's requests:

     --  To pay pre-petition trade claims in full to vendors who
agree to continue providing goods and materials on normal terms
to the Company's Uniroyal Engineered Products (Naugahyde)
division.

     --  To pay pre-petition claims of critical subcontractors
of its Sterling Semiconductor unit.

     -  To pay pre- and post-petition wages, compensation and
benefits to employees.

     -  To honor all customer warranty and rebate programs.

"We are gratified by the Court's prompt action," Mr. Curd said.
"This will allow us to meet obligations to employees, suppliers
and customers. Their dedication and support have been crucial in
the past and will be vital in the future."

Mr. Curd noted, "The reorganization proceeding should have
virtually no impact on daily operations.  Our facilities will
remain open, and transactions will proceed in the ordinary
course of business.  Our customers should experience no
interruption in the supply of our products."

Uniroyal Technology's Compound Semiconductors & Optoelectronics
business segment includes Uniroyal Optoelectronics, LLC,
Sterling Semiconductor, Inc., and NorLux Corp.  Uniroyal
Optoelectronics manufactures high brightness light emitting
diodes (HB-LEDs), a rapidly growing market with applications
such as traffic signals, indoor/outdoor signage and automotive
applications.  Brand names include POWER-Ga(i)N and POWER-
BR(ite).  Sterling Semiconductor is a producer of silicon
carbide (SiC) substrates, epitaxial thin films on SiC substrates
and is developing SiC devices for wireless communications,
industrial process control, and power amplification.  NorLux
Corp. specializes in the design and manufacture of custom
lighting solutions utilizing light emitting diodes (LEDs).  The
Company's Coated Fabrics Segment includes the well-known brand
name Naugahyde.  The Company has a total of approximately 400
employees at offices and manufacturing operations in six states.
The Company's common stock and warrants trade on the Nasdaq
SmallCap market under the symbols UTCI and UTCIW, respectively.


US AIRWAYS: Intends to Honor Prepetition Maintenance Claims
-----------------------------------------------------------
US Airways Group is required to perform significant maintenance
and overhaul work to maintain its fleet of aircraft properly and
safely and in accordance with the regulations of the Federal
Aviation Administration.  Although the Debtors perform a large
part of their aircraft maintenance and repair work with their
own personnel, they also rely on Outside Maintenance Providers
to perform a material part of their aircraft, engine and other
equipment maintenance and repair work.  Most of the Outside
Maintenance Providers perform maintenance and repair work
pursuant to ongoing maintenance and service contracts, or on a
credit basis and deliver invoices to the Debtors.  Some of the
Outside Maintenance Providers offer "on-call" maintenance and
repair services at various destinations, which enable the
Debtors to avoid maintaining complete repair facilities and
employee mechanics at every destination city.  As part of their
maintenance and repair work, the Outside Maintenance Providers
also supply and sell aircraft component parts.

The Debtors have developed strong long-standing relationships
with their Outside Maintenance Providers over the course of
several years that has allowed them to negotiate favorable
pricing and trade credit terms.  The Debtors fear that their
failure to honor their prepetition obligations to the Outside
Maintenance Providers would jeopardize these relationships.
Because the universe of qualified Outside Maintenance Providers
is limited, the Debtors believe that it would be difficult to
replace the majority of these providers on economically viable
terms.  Additionally, many of the Outside Maintenance Providers
are currently in the possession of aircraft, engines and other
equipment that are vital to the Debtors' operations and may
assert possessory liens refusing to redeliver these properties
to the Debtors until they are paid the prepetition amounts.

The Debtors use domestic and foreign commercial common carriers,
movers, shippers, freight forwarders/consolidators, delivery
services, customs brokers, shipping auditing services, and
certain other third-party services providers to ship, transport,
store, move through customs, and deliver goods through
established national and international distribution networks in
their maintenance and repair operation.  The Debtors rely
extensively on these Shippers to transport parts to and from
their Outside Maintenance Providers.  The services are critical
to the Debtors' day-to-day operations.  At any given time, there
are numerous shipments en route to or from the Outside
Maintenance Providers.  Therefore, some Shippers are currently
in possession of engines and other equipment that is vital to
the Debtors' operations.  They may refuse to deliver or release
these to the Debtors until they are paid prepetition amounts.

The Debtors have reviewed disbursements made during the period
from January through June 2002 to Outside Maintenance Providers
and Shippers.  The average total monthly payments were
$25,000,000 for the Outside Maintenance Providers, and $800,000
for the Shippers.  The Debtors estimate that outstanding
prepetition obligations owed to the Outside Maintenance
Providers are between $10,000,000 to $11,000,000, and to
Shippers between $500,000 and $1,000,000, as of the Petition
Date.  Accordingly, the Debtors seek the Court's authority to
pay the Outside Maintenance Providers and Shippers.

The Debtors also rely on Contractors, subcontractors and
professional service firms to perform construction, maintenance
and repairs at their facilities.  To the extent these or other
similar parties could have a valid statutory or possessory lien
on the Debtors' assets, the Debtors seek the Court's authority
to pay these parties.  The average monthly expenditure for these
Contractors is estimated to be $800,000 per month.  The Debtors
estimate that the amount of outstanding prepetition obligations
owed to the Contractors is between $500,000 and $1,000,000, as
of the Petition Date.

In some instances, the Debtors oversee construction projects
where they manage and monitor the construction process and act
as a conduit for the remittance of payments to Contractors
called Pass Through Projects.  The construction of the new
terminal at the Philadelphia International Airport, where the
Debtors are overseeing its construction on behalf of The
Philadelphia Authority for Industrial Development and the City
of Philadelphia is an example.  As part of their management
responsibilities, the Debtors review and verify whether or not
invoiced work has been performed or goods and services have been
provided.  The Debtors verify and submit invoices to the bond
trustee who is responsible for processing the invoices and
remitting payments to the Contractors and other parties.  As the
Debtors' duties and responsibilities do not implicate assets of
the Debtors' estates, the Debtors also seek the Court's
permission to continue managing and monitoring the Pass Through
Projects. (US Airways Bankruptcy News, Issue No. 2; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


US AIRWAYS: Reneges on Tentative Pact Between Allegheny & Pilots
----------------------------------------------------------------
In a strange turn of events, the US Airways Group, Inc., has
forced Allegheny Airlines and its pilots, as represented by the
Air Line Pilots Association, International, out of a tentative
agreement, based on an issue related to successorship.  The TA
was reached on August 11, 2002, to address the US Airways
Group's restructuring plan.

While the US Airways Group has made no specific indication that
it plans to sell Allegheny, a wholly owned subsidiary, the Group
says it will withdraw the tentative agreement unless the
successorship clause can be amended.  As agreed to, the clause
states that if Allegheny is sold or if any transfer or change of
control of the company is implemented, with the exception of a
merger with another wholly owned subsidiary, the original terms
of the Allegheny pilots' contract would be reinstated.

Allegheny and its pilots have conducted contract talks since
April 2002 to address the US Airways Group's weakening financial
position.  The Group received approval for a $900 million
guarantee of a conditional $1 billion Air Transportation
Stabilization Board loan, subject to certain terms including the
seeking of concessions from its employees.  On August 11, 2002,
the US Airways Group filed for Chapter 11 bankruptcy.

Acting Master Executive Council Chairman John Carlisle, leader
of ALPA's Allegheny pilot unit, stated, "We're perplexed by this
last-minute change in position.  Pulling the tentative agreement
from the table leads us to wonder if US Airways wanted Allegheny
and its pilots to have this deal in the first place."

Allegheny Airlines operates as a US Airways Express carrier and
serves 38 cities in twelve states in the eastern United States
with over 380 daily flights.

ALPA is the world's oldest and largest pilots union,
representing 66,000 members at 43 airlines in the U.S. and
Canada. Visit the ALPA Web site at http://www.alpa.org

US Airways Inc.'s 10.375% bonds due 2013 (U13USR2) are trading
at 10 cents-on-the-dollar, DebtTraders reports. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=U13USR2for
real-time bond pricing.


US AIRWAYS: Implements New Set of Policies to Ensure Low Fares
--------------------------------------------------------------
US Airways has introduced a new set of policies designed to
ensure its ability to continue to offer low fares for its most
cost-conscious customers, while protecting the value of less
restrictive fares for business travelers.  The policies continue
to reward higher paying passengers with options that reflect
their willingness to pay more for their tickets in exchange for
added benefits and flexibility. In addition, fees for various
services are being implemented and fare rules and restrictions
are being strictly enforced.

"These changes are a necessary response to the rapidly-changing
marketplace for air travel," said B. Ben Baldanza, senior vice
president of marketing at US Airways.  "Economic pressures
continue to impact both air travelers and the airline industry.
US Airways is seeking to retain valuable benefits for our
premium travelers while trimming costs in a manner that allows
us to maintain low fares for cost-conscious travelers to the
hundreds of communities in our system."

Effective immediately, non-refundable fares for all US Airways
domestic, Caribbean, U.S. to and from Canada and U.S. to Europe
destinations must be used for the specifically ticketed flight
and will have no value once the flight has departed.  Changes
may be made to the non-refundable itineraries before scheduled
departure, subject to certain restrictions and fees.  Under
the previous policy, the value of an unused non-refundable
ticket could be credited toward the purchase of another US
Airways ticket, less the applicable reissue fee, for up to one
year.

"This change makes purchasing airline tickets like many other
products that people buy for a specific date and time such as
Broadway shows and sporting events.  If you miss the event, your
ticket isn't good for the next day," said Baldanza.  "Since most
people travel as originally ticketed, most customers will not be
impacted by this change.  This policy does not change our
commitment to provide a high level of service to all US Airways
passengers."

Ray Pierce, chairman of Washington D.C.-based Executive Travel
Associates, a member of the Travel Management Alliance, said,
"This is the most sensible thing that US Airways can do.  It
makes a non-refundable ticket truly non-refundable and allows
the airline to price accordingly.  I applaud US Airways
for taking this action.  I'm glad an airline has the business
sense to do this."

Other Policy Changes to Non-refundable Fares

    * Customers ticketed on non-refundable fares will continue
to earn full Dividend Miles credit.  Effective for travel
Jan. 1, 2003, and beyond, miles and segments earned on most non-
refundable fares will not count toward Dividend Miles Chairman's
Preferred, Gold Preferred and Silver Preferred status.

    * Corporate discount programs will no longer be applicable
for certain non-refundable fare classes, generally those with
advance purchase and minimum stay requirements.

    * Customers who have non-refundable tickets will not be
allowed to stand-by for alternate flights.

    * Tour and consolidator tickets will become non-refundable
and have no value after the ticketed travel date.

"Customers have clearly shown their preference for low fares.
These moves allow US Airways to offer these fares in a more
economic way while maintaining the benefits extended to higher
paying passengers, such as the ability to refund and exchange
tickets, stand-by for other flights and earn Dividend Miles
credit toward Preferred status," said Baldanza.

In addition to the rule changes, US Airways, like other
carriers, has implemented the following changes:

    * Existing fare rules and restrictions, as well as policies
on the collection of fees, will be strictly enforced.

    * Customers ticketed by US Airways that qualify for an e-
ticket and request a paper ticket will be charged $25 per
ticket.

    * On transatlantic flights, alcoholic beverages will no
longer be offered for free to Economy class passengers.

    * US Airways also has reduced its utilization of certain
distribution channels, including online sites which do not
specify the airline prior to the travel purchase, and domestic
consolidators.  The airline will continue to focus on making its
lowest fares available on its Web site and via other effective
low-cost channels.

"US Airways is recognizing a new competitive reality and
tailoring our product accordingly," Baldanza said.  "These
incremental changes will be the first of many that will
positively impact our bottom line.  By improving US Airways'
revenues and our long-term viability, we will provide customers
with continued competition and choice in the marketplace."


VALENTIS INC: Fails to Comply with Nasdaq Listing Requirements
--------------------------------------------------------------
Valentis, Inc., (Nasdaq: VLTS) received a Nasdaq Staff
Determination letter on August 22, 2002 indicating that the
Company fails to comply with the minimum $50,000,000 market
capitalization requirement set forth in Marketplace Rule
4450(b)(I)(A), and that its securities are therefore subject to
delisting from The Nasdaq National Market, effective at the
opening of business on August 30, 2002, unless the Company
requests a hearing prior to that time.

The Company has requested an oral hearing before a Nasdaq
Listing Qualifications Panel to review the Staff Determination.
The hearing is expected to be scheduled within 45 days of the
filing of the hearing request. The Company has been advised that
the hearing request will stay the delisting of the Company's
securities, pending a decision by the Panel. The Company will be
presenting a plan to Nasdaq for achieving the requirements for
continued listing, but there can be no assurance the Panel will
grant the Company's request for continued listing.  If the
Company's securities are delisted from The Nasdaq National
Market, holders of the Company's preferred stock will have the
right to require the Company to redeem some or all of the
preferred stock.

Valentis is Converting Biologic Discoveries into Innovative
Products. Valentis has three product platforms for the
development of novel therapeutics:  the GeneMedicine,
GeneSwitch(R) and DNA vaccine platforms. The GeneMedicine
platform includes a comprehensive array of proprietary nucleic
acid delivery systems, including the broad cationic lipid
portfolio, from which appropriate formulations and modalities
may be selected and tailored to fit selected genes, indications,
and target tissues.  The del-1 GeneMedicine therapeutic is the
lead product for the GeneMedicine platform of non-viral gene
delivery technologies.  Del-1 is an angiogenesis gene that is
being developed for peripheral arterial disease and ischemic
heart disease.  The EpoSwitch(TM) therapeutic for anemia is the
lead product for the GeneSwitch(R) platform and is being
developed to allow control of erythropoietin protein production
from an injected gene by an orally administered drug.  We have
developed synthetic vaccine delivery systems based on several
classes of polymers.  Our proprietary PINC(TM) polymer-based
delivery technologies for intramuscular administration provide
for higher and more consistent levels of antigen production.
Additional information is available at http://www.valentis.com


WEIRTON STEEL: Expresses Concern About 2002 Import Projections
--------------------------------------------------------------
Weirton Steel Corp.'s chief executive said while 2002 could be
among the highest years for steel imports, the situation could
be far worse if not for tariffs the Bush administration lodged
against imports earlier this year.

U.S. Census Bureau preliminary data released today revealed that
steel imports jumped 5.7 percent from June's 2.8 million net
tons to 2.9 million net tons in July.  Through July of this
year, 17.8 million net tons of foreign steel entered the U.S.
When annualized, the total net tonnage for 2002 is 30.7 million.

The past five years have been the highest on record for steel
imports. The annual net tonnage totals include: 1997, 31.1
million; 1998, 41.5 million (record year); 1999, 35.7 million;
2000, 37.8 million; and 2001, 29.8 million.

"Without the tariffs, prices would be much lower and imports
totals would be much higher.  While we are not comfortable with
this year's import projections, we will take the opportunity
three years of tariffs will provide to improve our
competitiveness," said John H. Walker, Weirton Steel president
and chief executive officer.

Weirton Steel is the seventh largest U.S. integrated steel
company.

                           *   *   *

As reported in Troubled Company Reporter's August 20, 2002
edition, Standard & Poor's Ratings Services raised its corporate
credit rating on integrated steel producer Weirton Steel Corp.,
to triple-'C' from 'D' following the company's debt
restructuring.

Standard & Poor's also assigned its triple-'C'-minus rating to
the Weirton, West Virginia-based company's new senior secured
facilities. The current outlook is developing.

The restructuring involved Weirton's exchange of its existing
senior notes for a combination of senior notes and preferred
stock. The company also replaced its senior secured borrowing
base facility with a larger facility, which is also secured and
subject to a borrowing base.


WEIRTON STEEL: Says ITC Ruling Weakens Ability to Rebuild Sector
----------------------------------------------------------------
Weirton Steel Corp.'s President and Chief Executive Officer John
H. Walker said Tuesday's negative decision by the U.S.
International Trade Commission was not supported by the
evidence.

The ITC voted 4 to 1 that 20 countries did not violate U.S.
pricing and/or subsidy laws by exporting cold-rolled steel to
domestic markets.  The ITC rendered its decision despite a
recent contrary opinion by the U.S. Commerce Department which
prompted it to issue preliminary tariffs against the countries.

"We're disappointed.  Our case was sound.  This ruling together
with other recent events will make it more difficult to rebuild
the domestic steel industry after years of suffering through
illegally imported steel," Walker said.

"The tariffs President Bush has provided gives us limited time
to recuperate from the flood of unfair steel imports during the
past four years. But [Tues]day's ruling, coupled with tariff
exclusions granted since June, will greatly hamper the process.
And, we still have to deal with tariff appeals pending before
the World Trade Organization."

Weirton Steel and six other U.S. steelmakers filed a trade case
with the ITC in October 2000 claiming cold rolled imports from
the 20 countries violated antidumping laws from early 2000
through late 2001.

"Recent editorials in national news publications have criticized
us for pursuing this case after President Bush enacted the
tariffs.  But with the exclusions and the possibility of the
tariffs being weakened next year during a procedural review, the
trade case system provides a safeguard against unfair trade.
The public rarely, if ever, reads in these publications that in
recent years it has been proven through such steel import trade
cases that many countries have violated U.S. trade laws.  Why
aren't these facts ever publicized?" Walker remarked.

The countries named in the cold rolled case included Argentina,
Australia, Belgium, Brazil, France, Germany, India, Japan, South
Korea, The Netherlands, New Zealand, China, Russia, South
Africa, Spain, Sweden, Taiwan, Thailand, Turkey and Venezuela.

In addition to Weirton Steel, the other complainants in the case
were Bethlehem Steel, National Steel, Nucor, Steel Dynamics,
U.S. Steel and WCI Steel.

Weirton Steel is the seventh largest U.S. integrated steel
company.

Weirton Steel Corporation's 11.375% bonds due 2004 (WRTL04USR1)
are trading at 34.5 cents-on-the-dollar, DebtTraders says. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=WRTL04USR1
for real-time bond pricing.


WHEELING-PITTSBURGH: Sells 84K Shares in Prudential Financial
-------------------------------------------------------------
Wheeling-Pittsburgh Steel Corp., gives notice that it has sold
84,113 shares of the common stock of Prudential Financial, Inc.
on the New York Stock Exchange for $2.53 million.  Neuberger
Berman brokered the shares and received a $4,200 commission.
(Wheeling-Pittsburgh Bankruptcy News, Issue No. 25; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


WICKES INC: S&P Junks Credit Rating, Citing Marginal Liquidity
--------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on building materials supplier Wickes Inc., to triple-
'C'-plus from single-'B'-minus based on the company's marginal
liquidity.

The outlook is negative. Vernon Hills, Illinois-based Wickes has
about $64 million of rated debt.

"Wickes had about $5 million of availability under its revolving
credit facility, net of the $25 million minimum availability
requirement, as of June 29, 2002; current debt maturities of $10
million; and $64 million of senior subordinated notes that
mature in December 2003," Standard & Poor's credit analyst
Patrick Jeffrey said. "Although Wickes has improved its cost
structure in recent quarters, we believe the company will need
to obtain additional sources of liquidity to meet its debt
maturities through 2003."

Standard & Poor's said it believes Wickes will be challenged to
improve cash flow and liquidity over the next year, and that a
further decline in cash flow or liquidity could result in a
downgrade. It said the company has faced a challenging operating
environment as lumber price declines have impacted sales and
earnings.

A significant decline in lumber prices, which began in the
second quarter of fiscal 2000, has resulted in negative same-
store sales trends through much of this operating period.
Standard & Poor's believes lumber prices will remain depressed
due to the weakened U.S. economy. Cost savings initiatives and
lower debt levels have resulted in EBITDA coverage of interest
trending at 1.4 times.

Wickes is one of the largest suppliers of building materials in
the U.S., operating 91 sales and distribution facilities and 24
component manufacturing facilities in 22 states. The company
competes in a highly fragmented industry that is closely linked
to residential building construction. The industry is cyclical,
has substantial volatility in lumber prices, and can be
negatively affected by adverse weather conditions.


WORLDCOM INC: Signing-Up Smith Pachter as Special Counsel
---------------------------------------------------------
Worldcom Inc., and its debtor-affiliates want to employ and
retain Smith Pachter McWhorter & Allen PLC, nunc pro tunc to the
Petition Date, as their special government contracts counsel
pursuant to Sections 327(e) and 328(a) of the Bankruptcy Code.

The Debtors expect Smith Pachter to:

A. advise them as to government contract law issues;

B. represent them as needed before the Federal Aviation
   Administration, the FAA Office of Dispute Resolution for
   Acquisition, and the General Accounting Office regarding
   their present and future government contracts;

C. assist them in evaluating FAA debriefing materials and
   represent them as necessary in any bid protests filed under
   FAA's SIR No. DTA01-00-S-00FTI;

D. advise and assist them in preparing and prosecuting
   contract appeals to the Armed Services Board of Contract
   Appeals or the Court of Federal Claims as to certain requests
   for compensation for additional work performed under their
   Defense Information Systems Network contract with the
   Department of Defense; and

E. provide any other necessary legal services and advice in
   related matters.

WorldCom Senior Vice President Susan Mayer relates that since
June 2002, Smith Pachter and certain of its members and
associates have rendered legal services to the Debtors in
connection with government contract matters.  Smith Pachter's
services have primarily related to counseling the Debtors on
federal procurement issues arising from the Debtors' pursuit of
government contract opportunities with the FAA.  As a
consequence of its representation of the Debtors, Smith Pachter
is intimately familiar with the complex legal issues that have
risen and are likely to arise in connection with the Debtors'
pursuit of award of a FAA contract under SIR No. DTA01-00-S-
00FTI.  The Debtors believe that both the interruption and the
duplicative cost involved in obtaining substitute counsel to
replace Smith Pachter's unique role at this juncture would be
harmful to their estates and creditors.

Were the Debtors required to retain counsel other than Smith
Pachter in connection with the specific and limited matters upon
which Smith Pachter's advice is sought, Ms. Mayer believes that
the Debtors, their estates and all parties-in-interest would be
unduly prejudiced by the time and expense necessary to replicate
Smith Pachter's ready familiarity with the intricacies of the
Debtors' business operations, corporate and capital structure,
and strategic prospects with the FAA.  In addition, the Debtors
may not be able to meet the strict time limits imposed by FAA's
procurement procedures if they were required to retain counsel
other than Smith Pachter.

The Debtors contend that Smith Pachter is well qualified and
uniquely able to provide the specialized advice sought by the
Debtors on a going forward basis.  Ms. Mayer points out that
Smith Pachter is widely recognized for its government contract
law expertise.  Smith Pachter handles matters in virtually every
aspect of government contract law, including bid protests,
responsibility determinations, agency investigations, and
debarments.  The firm counsels government contract clients in
transactional, contract negotiation, litigation, and bid protest
issues.  The firm's practice includes advising clients on
procurement matters related to their operations at the U.S.
federal level, all 50 states, U.S. territories, and many
international markets.  Ms. Mayer adds that Smith Pachter has
represented numerous contractors in procurement matters before
the FAA, including hearings before FAA's Office of Dispute
Resolution.

Ms. Mayer recounts that on July 15, 2002, the FAA awarded a
contract under SIR No. DTA01-00-S-00FTI to Harris Corporation,
one of the Debtors' competitors.  In accordance with the FAA's
request, the Debtors submitted debriefing questions by 12:00
p.m. on July 26, 2002.  The debriefing was to occur within ten
days.  From the debriefing date, the Debtors will have five
business days to evaluate debriefing materials and file a bid
protest, if warranted, challenging the FAA's contract award to
Harris. Therefore, the Debtors will need counsel well versed in
the federal procurement laws and procedures of the United States
and the requirements of FAA SIR No. DTA01-00-S-00FTI.

Jonathan D. Shaffer, a member of the Smith Pachter firm, assures
the Court that the partners and other attorneys of the Firm do
not represent or hold any interest adverse to the Debtors and
their estates with respect to the matters on which Smith Pachter
is to be retained in these cases.  In addition, the Firm has no
connection with the Debtors, the Debtors' creditors or any other
party-in-interest, or their respective attorneys and
accountants, the United States Trustee, or any person employed
in the Office of the United States Trustee that would affect the
Firm's ability to represent the Debtors in these cases.  Smith
Pachter will conduct an ongoing review of its files to ensure
that no conflicts or other disqualifying circumstances exist or
arise. If any new facts or relationships are discovered, the
Firm will supplement its disclosure to the Court.

Compensation will be payable to Smith Pachter on an hourly
basis, plus reimbursement of actual, necessary expenses and
other charges.  The hourly rates charged by Smith Pachter's
attorneys that are currently expected to work on this matter
are:

       Partners               $320 - 395
       Other Attorneys         190 - 270
       Law Clerks              135

For this engagement, Mr. Shaffer says, the Firm will provide a
10% discount from these rates. (Worldcom Bankruptcy News, Issue
No. 5; Bankruptcy Creditors' Service, Inc., 609/392-0900)


W.R. GRACE: Fitch Withdraws Senior Debt & Comm'l Paper Ratings
--------------------------------------------------------------
Fitch Ratings has withdrawn its rating on WR Grace & Co.'s
senior unsecured notes and commercial paper program. The senior
unsecured notes were rated 'DD' and the short-term rating was
'D'.  Grace announced in April 2001 that it had filed for
reorganization under Chapter 11 of the U.S. Bankruptcy Code in
response to a rising tide of asbestos claims.


XO COMMS: Committee Wins Nod to Hire Jefferies as Fin'l Advisors
----------------------------------------------------------------
XO Communications, Inc.'s Official Unsecured Creditors'
Committee obtained the Court's permission to employ and retain
Jefferies & Company Inc., as financial advisor, nunc pro tunc to
June 24, 2002.

At the request of the Committee, Jefferies has been rendering
services since June 24, 2002.  Pursuant to the Jefferies
Engagement Letter, Jefferies will provide postpetition services
to:

(a) become familiar with and analyze the business, operations,
    properties, financial condition and prospects of the
    Company;

(b) advise the Committee on the current state of the
    restructuring market;

(c) assist and advise the Committee in developing a general
    strategy for accomplishing a restructuring; and

(d) assist and advise the Committee in evaluating and analyzing
    a restructuring including the value of the securities, if
    any, that may be issued under any restructuring plan.

In return for its services, Jefferies will be compensated:

(a) a monthly cash retainer fee equal to $150,000 per month;

(b) at the closing of a Restructuring completed by the
    Committee, a fee in cash -- or at the Committee's option, in
    like-kind securities -- equal to the sum of:

      (i) 0.50% of that portion of the Total Consideration paid
          or delivered to the holders of the Senior Notes in
          respect of their Senior Notes above $464,400,000 up
          to and including $893,000,000, plus

     (ii) 1.0% of that portion of the Total Consideration paid
          or delivered to the holders of the Senior Notes in
          respect of their Senior Notes above $893,000,000 up
          to and including $1,786,000,000, plus

    (iii) 2.0% of that portion of the Total Consideration paid
          or delivered to the holders of the Senior Notes in
          respect of their Senior Notes above $1,786,000,000.

Total Consideration will mean the total proceeds and other
consideration in cash or, in the form of notes, securities and
other property, in connection with a Restructuring, including
amounts in escrow.

Non-cash consideration will be valued:

(x) publicly traded securities will be valued at the average of
    their closing prices -- as reported in The Wall Street
    Journal -- for the five trading days prior to the closing of
    a Restructuring; and

(y) any other non-cash consideration will be valued at the fair
    market value on the day prior to closing as determined in
    good faith by the Company and Jefferies.

If the parties are unable to agree on the value of any other
property, its value will be determined by arbitration in
accordance with the rules of the American Arbitration
Association and judgement upon the award entered by the
arbitrators may be entered in any court having jurisdiction.

In addition, the Debtor and its estate will reimburse Jefferies
for all reasonable out-of-pocket expenses.

The Debtor and its estate are to indemnify Jefferies, its
agents, principals and employees for all claims, damages,
liabilities and expenses incurred as a result of the parties'
involvement with the provision of financial advisory services,
except to the extent these liabilities resulted from gross
negligence or willful misconduct.  The Committee tells Judge
Gonzalez that indemnification is a standard term of the market
for investment bankers and financial advisors. (XO Bankruptcy
News, Issue No. 7; Bankruptcy Creditors' Service, Inc., 609/392-
0900)


XO COMMS: Carl Icahn's Tender Offer for Sr. Secured Debt Expires
----------------------------------------------------------------
Carl Icahn's tender offer for Senior Secured Debt of XO
Communications, Inc., expired with approximately $362 million
face amount being tendered. Together with the confirmations for
approximately $414 million face amount entered into on August
23, 2002, and the $171 million already owned, the purchase of
the Senior Secured Debt will bring Icahn's ownership to $947
million out of the total of $1 billion face amount of such Debt
outstanding. The Closing is scheduled today, August 29, 2002.

Mr. Icahn stated that he was extremely pleased by the results of
the tender offer. "This gives us the biggest stake in what we
consider one of the finest CLEC's in the business. While I
supported the Company's Plan of Reorganization founded on the
Forstmann-Telemex agreement which was confirmed by the
Bankruptcy Court on Monday, if, for any reason that transaction
does not take place, I look forward to working very closely with
the Company's fine management team in achieving the great
potential that is inherent in the XO assets."

Mr. Icahn indicated that he and his advisors continue to study
the Company's alternate Stand-Alone Plan of Reorganization to
see whether all parties concerned could help him overcome his
objections to the Plan as presently constituted. He stated,
"While I continue to be hopeful that the Forstmann-Telemex deal
will ultimately close, I am working to make the Stand-Alone Plan
palatable so that, in the event that confirmation is sought for
that Plan, it provides a sound capital structure that will
enable the Company to finance its future growth."


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

Issuer               Coupon   Maturity  Bid - Ask  Weekly change
------               ------   --------  ---------  -------------
Crown Cork & Seal     7.125%  due 2002    98 - 100       +2
Federal-Mogul         7.5%    due 2004    24 - 26        +2
Finova Group          7.5%    due 2009    28 - 30        0
Freeport-McMoran      7.5%    due 2006    87 - 89        -1
Global Crossing Hldgs 9.5%    due 2009   0.5 - 1.5       0
Globalstar            11.375% due 2004     3 - 5         0
Lucent Technologies   6.45%   due 2029    64 - 66        +5
Polaroid Corporation  6.75%   due 2002   5.5 - 7.5       0
Terra Industries      10.5%   due 2005    79 - 81        0
Westpoint Stevens     7.875%  due 2005    49 - 51        -1
Xerox Corporation     8.0%    due 2027    38 - 40        +1.5

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

                          *********

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

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

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

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

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

                          *********

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

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

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

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

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

                *** End of Transmission ***