TCR_Public/021018.mbx         T R O U B L E D   C O M P A N Y   R E P O R T E R

            Friday, October 18, 2002, Vol. 6, No. 207    

                          Headlines

ACORN PRODUCTS: Fails to Comply with Nasdaq Listing Guidelines
AKAMAI TECHNOLOGIES: Sept. 30 Balance Sheet Upside-Down by $113M
AMERCO: Fitch Drops Senior Unsecured Debt Rating to DD from B+
AMERICAN BANKNOTE: Emerges from Bankruptcy with Flying Colors
AQUILA INC: Total Asset Sales Nearly Reaches Planned $1BB Mark

ARBEK OAK: Machinery and Equipment to be Auctioned-Off Today
BANYAN STRATEGIC: Closes Sale of Northlake Assets for $20.4 Mil.
BIRMINGHAM STEEL: Court OKs Ernst & Young Retention as Auditors
BUDGET GROUP: Bags Nod to Settle Prepetition Franchisee Claims
CENTRAL RECYCLING: Sells Scrap Facility for Non-Ferrous Metals

CHAMPION ENTERPRISES: Third Quarter Net Loss Balloons to $39MM
COMMUNICATION DYNAMICS: Gets Okay to Use Interim Cash Collateral
COMPUSPORT LLC: Will Auction Off Assets on November 4, 2002
CONSECO, INC.: Banks Agree to Forebear until Nov. 26, 2002
CROWN CORK & SEAL: Reports Improved Results for Third Quarter

CUMMINS: S&P Drops Rating to BB- Amid Adverse Market Conditions
DELIA*S CORP: Taps Peter J. Solomon to Evaluate Alternatives
DESA HOLDINGS: Has Until Dec. 5 to Make Lease-Related Decisions
DICE INC: Sept. 30 Balance Sheet Insolvency Widens to $37 Mill.
DYNEGY: Will Exit Marketing & Trading Business in NA & Europe

EBIX.COM INC: Stays on Nasdaq SmallCap Pending Hearing Outcome
ENRON CORP: Asks Court to Allow Settlement with British Energy
ENVIRONMENTAL SAFEGUARDS: AMEX Halts Trading Effective Oct. 15
EOTT ENERGY: Intends to Implement Key Employee Retention Plan
EOTT ENERGY: Secures Court's Nod for $575 Million DIP Financing

EXIDE TECHNOLOGIES: Committee Wants More Time to Challenge Liens
FEDERAL-MOGUL: Wants to Pull Plug on Headquarters Lease Contract
FOAMEX INT'L: Talking with Bank Lenders to Amend Fin'l Covenants
FRONTLINE CAPITAL: Seeks to Extend Exclusivity Until February 7
GILAT SATELLITE: Commences Debt Restructuring Talks with Lenders

GLOBAL CROSSING: Court Approves Lucent Settlement Agreement
GS MORTGAGE: Fitch Junks Rating on Class J 1998-C1 Certificates
HIGH SPEED ACCESS: Sets Annual Shareholders' Meeting for Nov. 27
HURRY INC: Special Shareholders' Meeting Slated for November 25
ICO INC: Extends Amended Senior Notes Tender Offer to October 30

INFORMATION RESOURCES: Working Capital Deficit Tops $27 Million
INTEGRATED HEALTH: Selling IHS-126 Assets to Baltic for $2.6MM
INTEGRATED INFORMATION: Completes Comprehensive Fin'l Workout
INTEGRATED TELECOM: Taps Pachulski Stang as Bankruptcy Counsel
INTERLIANT INC: Obtains Approval to Access $5MM DIP Financing

KAISER ALUMINUM: Secures Approval to Hire Mercer as Consultants
KASPER ASL: Wants Benedetto Gartland to Continue as Advisors
KMART CORP: Obtains Court Approval to Expand PwC Engagement
LERNOUT: Wants Until Year-End Solicit Votes on Chapter 11 Plan
LTV CORP: Opts to Reorganize Copperweld as a Stand-Alone Company

LTV: Copperweld Names McGlone Pres. & Chief Operating Officer
MARINER POST-ACUTE: Has Until Feb. 28, 2003 to Challenge Claims
METALS USA: Court OKs Indiana Property Sale to Butler for $1.4M+
NEON COMMUNICATIONS: Court Approves $12.5 Million DIP Financing
NETIA: Receives Ruling from Polish Court re Millennium Deal

NETWORK ACCESS: Maintains Plan Filing Exclusivity Until Dec. 31
NEXIQ TECH: Voluntary Chapter 11 Case Summary
NOGA ELECTRO-MECHANICAL: Fails to Meet Nasdaq Listing Guidelines
NOMURA ASEET: Fitch Places B-Rated Class B-2 Notes on Watch Neg.
NOMURA ASSETS: Fitch Drops Ratings on 1994-MD1 B-3 Classes to D

NOVA CDO: S&P Puts Four B-Rated Note Classes on Watch Negative
OWENS CORNING: Seeks Approval to Modify and Extend DIP Financing
PACIFIC BASIN: Files for Chapter 7 Liquidation in California
PG&E NATIONAL: Moody's Hatchets Units' Ratings to Lower-B Levels
POLAROID: Gets Okay to Hire Barnes Richardson as Trade Attorneys

PORTA SYSTEMS: Fails to Meet AMEX Continued Listing Conditions
SEALY CORP: September 1 Equity Deficit Narrows to $124 Million
SECOND CHANCE: Leonard Waldman Steps Down as Company President
SOUTHERN UNION: Selling Texas Division to ONEOK for $420 Million
TAYLOR CAPITAL: Fitch Plucks Lowered Ratings from Watch Negative

TELAXIS COMMS: Fails to Maintain Nasdaq Listing Requirements
TELESOFT CORP: Will Commence OTCBB Trading Effective October 24
TENFOLD CORP: Initiates Restructuring of US-Based Operations
TRANSTECHNOLOGY: Posts Improved Operating Performance for Q2
UNITED AIRLINES: Third Results Coming Today; Chapter 11 Possible

U.S. STEEL: Signs Pact to Sell Businesses to Transtar for $500MM
VION PHARMACEUTICALS: Will Appeal Nasdaq Delisting Notification
WILLIAMS COMMS: Leucadia Acquires 44% Equity Stake in WilTel
WORLDCOM INC: Asks Court to Okay Proposed Asset Sale Procedures
W.R. GRACE: Asbestos Claimants Want a Trustee Appointed

W.R. GRACE: Wants More Time to Make Lease-Related Decisions

* BOOK REVIEW: The Phoenix Effect: Nine Revitalizing Strategies
               No Business Can Do Without

                          *********

ACORN PRODUCTS: Fails to Comply with Nasdaq Listing Guidelines
--------------------------------------------------------------
Acorn Products, Inc., (Nasdaq:ACRN) has received a Nasdaq Staff
Determination on October 11, 2002, indicating that the Company
fails to comply with the minimum market value of publicly held
shares requirement for continued listing as set forth in
Marketplace Rule 4310, and that its common stock, therefore, is
subject to delisting from The Nasdaq SmallCap Market. The
Company intends to request a hearing before a Nasdaq Listing
Qualifications Panel to appeal the Staff Determination.

The Company believes that upon completion of its previously
announced rights offering, the Company will regain compliance
with all Nasdaq listing requirements. However, there can be no
assurance the Panel will grant the Company's request for
continued listing.

Acorn Products, Inc., through its operating subsidiary
UnionTools, Inc., is a leading manufacturer and marketer of non-
powered lawn and garden tools in the United States. Acorn's
principal products include long handle tools (such as forks,
hoes, rakes and shovels), snow tools, posthole diggers,
wheelbarrows, striking tools, cutting tools and watering
products. Acorn sells its products under a variety of well-known
brand names, including Razor-Back(TM), Union(TM), Yard 'n
Garden(TM), Perfect Cut(TM) and, pursuant to a license
agreement, Scotts(TM). In addition, Acorn manufactures private
label products for a variety of retailers. Acorn's customers
include mass merchants, home centers, buying groups and farm and
industrial suppliers.


AKAMAI TECHNOLOGIES: Sept. 30 Balance Sheet Upside-Down by $113M
----------------------------------------------------------------
Akamai Technologies, Inc. (NASDAQ: AKAM), a leading provider of
products and services that enable enterprises and government
agencies to extend and control their e-business infrastructure,
reported financial results for the third quarter ended September
30, 2002. Revenue for the third quarter 2002 was $35.4 million.

"In the third quarter of 2002, we continued to build upon our
EdgeSuite success and took proactive steps to accelerate our
drive to profitability, which we believe will position the
Company for long-term success," said George Conrades, chairman
and CEO of Akamai. "We are pleased with the steady growth in the
number of major enterprise customers validating our solutions in
spite of declining IT expenditures."

Wednesday morning, Akamai implemented a 29 percent reduction in
its global workforce, expecting to end the year with 550
employees, while realigning its go-to-market and service
offerings to focus on its most productive enterprise
opportunities. "By prioritizing our marketing and development
efforts on EdgeSuite, including Edge Computing, and focusing on
global enterprises, government, and only the top Web properties,
we are positioning the Company squarely in the sweet spot of our
technology advantage and customer opportunity," said Conrades.

Net loss, in accordance with United States generally accepted
accounting principles (U.S. GAAP), for third quarter 2002 was
$47.5 million, compared to a net loss for the second quarter
2002 of $42.2 million, and for the third quarter 2001 a net loss
of $55.4 million.

Net loss for the third quarter 2002 before interest, taxes,
depreciation, amortization and other one-time and non-cash
charges (EBITDA) was $6.7 million, as compared to the second
quarter 2002 EBITDA loss of $8.3 million, down 60 percent from
the third quarter 2001 EBITDA loss of $16.6 million. EBITDA is
calculated as gross profit less research and development
expenses, sales and marketing expenses, and general and
administrative expenses.

Normalized net loss for third quarter 2002 totaled $31.5
million, or $0.28 per share, in line with First Call's consensus
summary net loss of $0.28 per share. Normalized net loss is
calculated as EBITDA less net interest expense, provision for
income taxes and depreciation. Second quarter 2002 normalized
net loss was $32.8 million and third quarter 2001 normalized net
loss was $38.2 million.

Third Quarter 2002 Highlights:

                           Customers

During the quarter, Akamai added 32 net new EdgeSuite customers,
including adidas-Salomon AG, America Online, Inc., The Bombay
Company, Inc., Federal Express, FOXSports.com, Rational
Software, Washington Post Newsweek Interactive, and Yum! Brands,
Inc. (the parent company of A&W All-American Food, KFC, Long
John Silver's, Pizza Hut and Taco Bell). The third quarter also
generated several key customer renewals, including Symantec
Corp. and Yahoo! Resellers accounted for approximately 22
percent of third quarter revenue, which is comparable to the
level of sales through channel partners in the prior two
quarters.

"Revenue from EdgeSuite was 39 percent of total revenue for the
quarter, up from 36 percent in the second quarter," said
Conrades. "As we expand our relationships with Fortune 1,000
companies and federal government agencies, the quality of our
revenue and customer base has significantly improved."

Further solidifying the Company's traction in the government
sector, Akamai announced during the third quarter that it has
been awarded a five-year schedule contract by the U.S. General
Services Administration. As a result, Akamai's services are now
included among the range of professional information technology
offerings provided by the GSA to federal agencies for
facilitating e-government programs.

                          Financials

"We exited the quarter with $142 million in cash and marketable
securities, and our business plan remains fully funded," said
Timothy Weller, chief financial officer of Akamai. "We have
consistently maintained our solid balance sheet in a difficult
economy through a shift to higher margin services, across-the-
board cost reductions, and a strong record of collections from
our customers with days sales outstanding at 43 days for the
second consecutive quarter."

At September 30, 2002, the Company had approximately $142
million of cash, cash equivalents, and short-term and long-term
marketable securities as compared to $160 million at June 30,
2002.

Capital expenditures for the quarter were $7.0 million, which
included $4.4 million of one-time expenditures to move Akamai's
headquarters into 8 Cambridge Center. This move is expected to
produce $9 million dollars in annual lease savings.

At September 30, 2002, the Company had 116.6 million shares of
common stock outstanding. At September 30, 2002, common stock
outstanding and unexercised stock options and warrants totaled
134.9 million shares.

Also, at September 30, 2002, the Company's balance sheets show a
total shareholders' equity deficit of about $113 million.

                            Network

In the third quarter, Akamai continued to optimize its server
network around the world, including an enhanced deployment with
America Online. Akamai has 12,942 servers located in 1,105
networks in 66 countries.

                        Management Change

Akamai also announced today that Timothy Weller has decided to
leave the Company by the end of the year. A search for his
replacement is underway. "We want to thank Tim for his many
contributions to Akamai's success," Conrades said. "We have been
privileged to have someone with his high intellect and integrity
on our team for three years, and we appreciate that he will
remain with the Company through an orderly transition process to
bring in a new CFO."

Akamai provides products and services that enable our customers
to extend and control their e-business infrastructure. Our
globally distributed computing platform enables the secure
delivery of networked information and applications, improving
cost, quality and time to market. With a computing platform
comprising more than 12,900 servers in more than 1,100 networks
in 66 countires, Akamai ensures the highest levels of
availability, reliability, and performance. Headquartered in
Cambridge, Massachusetts, Akamai provides products and services,
matched with world-class customer care, to hundreds of
successful enterprises, government entitites, and leading Web
businesses worldwide. For more information, visit
http://www.akamai.com  


AMERCO: Fitch Drops Senior Unsecured Debt Rating to DD from B+
--------------------------------------------------------------
Fitch Ratings lowers AMERCO's senior unsecured debt and
preferred stock ratings to 'DD' and 'D' from 'B+' and 'B-',
respectively. Senior unsecured debt guaranteed by AMERCO is also
lowered to 'DD'. The commercial paper rating is lowered to 'D'
from 'B'. All ratings are removed from Rating Watch.
Approximately $690 million of senior debt is covered by Fitch's
action.

Fitch's actions reflect the announcement by the company on Oct.
15, 2002 that it suspended payment of its Series 1997-C Bond
Backed Asset Trust. The company had a $100 million bond issue
due on October 15, 2002. A 'DD' rating indicates default but
that potential recoveries on the defaulted securities could
range between 50% and 90%.

In addition, AMERCO announced that it had retained Crossroads,
LLP as its financial advisor to assist in assessing its
strategic alternatives as the company moves to strengthen its
financial position.

Based in Reno, Nevada, AMERCO is a holding company whose
principal subsidiaries are U-Haul International, Inc., Republic
Western Insurance Co., Oxford Life Insurance Co., and AMERCO
Real Estate Co.  U-Haul is the leading consumer truck and
trailer rental company in North America and maintains a strong
market position in the self-storage market.


AMERICAN BANKNOTE: Emerges from Bankruptcy with Flying Colors
-------------------------------------------------------------
American Banknote Corporation announced that, as of October 1,
2002, the Company's Plan of Reorganization became effective,
emerging the Company from United States bankruptcy protection
for the first time since December 1999.

Under the terms of the reorganization, American Banknote
Corporation emerges with a restructured balance sheet, featuring
a reduction of debt of more than $100,000,000 (including accrued
but unpaid interest), and a significant increase in shareholder
equity.

Under American Banknote's reorganization plan, holders of its
11-1/4% debentures converted their debt into nearly 90% of the
reorganized Company's equity. In addition, American Banknote
exchanged approximately $12,000,000 of its 11-5/8% note claims,
which would have matured in August 2002, for its 10-3/8%
debentures, and extended the maturity date of the 10-3/8%
debentures through January 2005. Moreover, the Company received
the option to pay all interest on its remaining 10-3/8%
debentures in-kind rather than in cash.

According to the Company's Chief Financial Officer, Patrick
Gentile, "We are very pleased to leave the bankruptcy behind us,
and to emerge with strengthened resources and liquidity."

Added American Banknote Chief Executive Officer, Steve Singer:
"These are really exciting times for us at ABN, as we are
finally able to focus exclusively on our operating businesses.
There remain many real challenges ahead, particularly in light
of our continued dependence on the volatile Brazilian economy.
However, with our new capital structure, we believe that there
is the potential to build something special here."

Following the Company's emergence from bankruptcy, its Board of
Directors recently authorized management to repurchase up to $15
million face amount of its outstanding 10-3/8% debentures at a
discount to par value, either in the open market, or through
privately negotiated block transactions. Stated Gentile, "Any
repurchase decision will depend upon the availability of cash,
as well as future corporate developments."

American Banknote is a holding company, which operates through
its subsidiary companies. Its major subsidiaries are: The
American Bank Note Company, based in Trevose, Pennsylvania;
American Bank Note Grafica, based in Rio de Janeiro, Brazil;
Leigh-Mardon, based in Melbourne, Australia; CPS Technologies,
based in Lyon, France; and Transtex, based in Buenos Aires,
Argentina. Through these subsidiaries, the Company manufactures,
markets and distributes (and supplies related services to), a
variety of secure documents, media, fulfillment and
reconciliation systems. These include plastic cards (such as
ATM, credit, debit, loyalty and gift cards), smart cards,
business forms, electronic printing, documents of identity,
checks, money orders, stock and bond certificates and electronic
media.

Speaking of the subsidiary companies, Singer observed that,
"some of these business units are extraordinary assets, with a
wealth of history and strong brand-name recognition, dating back
to 1795. More than that, they are highly trusted by governments,
banking institutions and industry leaders, positioning them as a
leading secure source of, and service provider for, documents,
instruments and data of inherent value. We believe that we can
build on these resources, to enhance value for the Company's
stakeholders."

American Banknote Corporation traces its roots to 1795 and Paul
Revere, as an original printer of United States currency. For
2001, despite its bankruptcy, revenues exceeded $220,000,000 and
Earnings Before Interest, Depreciation and Amortization exceeded
$25,000,000. For complete details on American Banknote's
restructuring, kindly refer to the Company's reports on Form 8-
K, filed August 28, 2002, September 4, 2002 and October 16,
2002, and its Fourth Amended Plan of Reorganization in its
entirety. For complete details on American Banknote's recent
financial results, kindly refer to its 2001 Form 10-K, filed
April 1, 2002, and its First Quarter and Second Quarter 2002
Forms 10-Q, filed May 15, 2002 and August 14, 2002,
respectively.


AQUILA INC: Total Asset Sales Nearly Reaches Planned $1BB Mark
--------------------------------------------------------------
Aquila, Inc. (NYSE:ILA) -- whose preferred stock is currently
rated by Fitch at BB+ -- reported additional asset sales under
its previously announced restructuring program, bringing the
current total of assets it has sold or agreed to sell to $976.6
million. The company's stated goal since May has been to sell at
least $1 billion in assets to strengthen its balance sheet and
credit.

"We are continuing to focus on our transition back to our roots
as a regulated utility company and our exit from the elements of
our previous energy merchant strategy that are not consistent
with our current business model," said Aquila Chairman,
President and Chief Executive Officer Richard C. Green, Jr.

An Aquila subsidiary has sold to Black Hills Corporation for
$30.5 million a credit facility it provided to Mallon Resources
Corporation and Mallon Oil Company in 1999. The financing was
for development of oil and gas properties in New Mexico.

On October 15, Aquila sold 8 million common shares of Quanta
Services, Inc., (NYSE:PWR) for $3.00 per share in a privately
negotiated transaction. Through open market and private sales
since July, Aquila has sold more than 16 million Quanta shares
for total proceeds of about $44 million. It now holds
approximately 12.8 million shares and has a 14.3 percent equity
interest in Quanta, which builds and maintains energy and
communications networks across the United States.

As part of the ongoing reduction in Aquila's energy marketing
and trading activities, the company is on track with plans to
close its European headquarters in London and its office in
Essen, Germany by the end of this month. The office in
Sandefjord, Norway has been closed and all of Aquila's trading
through Nord Pool, the trading organization that handles energy
in Scandinavia, has ceased. Aquila also has terminated or
restructured the majority of its historical trading positions in
Europe and the remainder will be managed by Capacity Services
staff at its headquarters in Kansas City.

Aquila's announced agreements to sell assets are listed below.
The transactions closed to date total $796.6 million.

Aquila Asset Sales As of October 15, 2002      Net Proceeds
                                               (Millions)
----------------------------------      -----------------------
Completed:
----------
Lockport, N.Y., power project                           $  37.5
Natural gas pipeline and processing assets                265.0
UnitedNetworks (New Zealand distribution utility)         362.0
U.K. gas storage assets                                    34.9
Quanta Services stock (open market and private sales)      44.0
Mallon credit facility                                     30.5
Other businesses and assets                                22.7

                                                         -------
Subtotal                                                  796.6

Pending:
--------
Texas gas storage assets                                  180.0
                                                         -------
Total asset sales closed or pending                      $976.6

Based in Kansas City, Missouri, Aquila operates electricity and
natural gas distribution networks serving customers in seven
states and in Canada, the United Kingdom, and Australia. The
company also owns and operates power generation assets. At June
30, 2002, Aquila had total assets of $11.9 billion. More
information is available at http://www.aquila.com


ARBEK OAK: Machinery and Equipment to be Auctioned-Off Today
------------------------------------------------------------
Arbek Oak Furniture's machinery and equipment will be auctioned
off at 10 a.m. today, October 18 at the company's manufacturing
plant, 13780 Central Avenue, in Chino, winding down a going-out-
of-business sale which began in mid-September.

A preview of 1,500 lots -- including wood working machinery and
equipment, shop and hand tools, warehouse equipment and office
furnishings -- will be held at 10 a.m. on October 17.

Buxbaum/Century Services, which is managing the going-out-of-
business sale, will also auction off any of Arbek's remaining
furniture inventory at 10 a.m. on October 19. The items include
full sets and individual pieces.

Bidders on both auction days can pay by cash, Visa or
MasterCard. Checks are not accepted.

Arbek, which was founded in 1982, is shutting its doors
following a bank foreclosure. The company had sold its oak
furniture through more than 1,000 retailers nationally, ranging
from the Haverty, Wickes and Levitz chains, to independent
merchants.

Calabasas, California-based Buxbaum/Century is a joint venture
between Buxbaum Group and Century Services, a leading specialist
in industrial equipment appraisals and liquidations,
headquartered in Calgary, Alberta. Buxbaum/Century Services was
formed in 2000 to provide machinery and equipment appraisal and
auction services for financial institutions and corporations
throughout North America.

Buxbaum Group, also headquartered in Calabasas, provides
inventory appraisals, auctions on both fixed and liquid assets,
turnaround and crisis management, as well as other consulting
services for banks and other financial institutions with retail,
industrial, wholesale/distribution and consumer-product
manufacturing clients. The firm also provides liquidation
services on an equity or consultative basis for consumer-product
inventories, machinery and equipment. Additionally, Buxbaum buys
and sells consumer-product inventories on a closeout basis.


BANYAN STRATEGIC: Closes Sale of Northlake Assets for $20.4 Mil.
----------------------------------------------------------------
Banyan Strategic Realty Trust (OTC Bulletin Board:  BSRTS)
announced the completion of the sale of its last remaining real
estate asset - The Northlake Tower Festival Shopping Center in
Atlanta, Georgia - to Northlake Festival, LLC for a gross
purchase price of $20.4 million.  Northlake Tower Festival
Shopping Center is a 322,000 square foot power center on 38
acres located in suburban Atlanta. It is currently ninety-seven
percent (97%) leased to forty-nine tenants including: Toys R-Us,
Office Max, PetSmart, Haverty's, AMC Theaters and Bally Total
Fitness.

Upon closing, Banyan credited to the purchaser the outstanding
balance on the first mortgage loan ($16.73 million), which the
purchaser has assumed. Banyan also paid $0.43 million in real
estate commissions, closing costs, prorations and transaction
expenses, resulting in net proceeds of $3.24 million ($0.21 per
share).

L.G. Schafran, Interim President, Chairman and CEO of Banyan,
commenting upon the Northlake transaction, said:  "We are
pleased to announce the closing of our final real estate asset,
completing within a span of less than twenty- two months the
disposition portion of our Plan of Termination and Liquidation,
adopted in January of 2001.  We can now direct all of our
attention to a resolution of the Levine litigation, which we
hope to accomplish not later than the end of the second quarter
of 2003.  Further, assuming we are successful in obtaining the
no-action relief we have sought from the Securities and Exchange
Commission, we are poised and ready to dissolve the Trust on
December 31, 2002, and unless the Levine litigation is resolved
by that time, to transfer all remaining liabilities and assets
into a liquidating trust on that date.  If the Levine litigation
has been resolved by December 31, 2002, we expect to complete
our dissolution and make a final distribution of all cash,
without the necessity of a liquidating trust."

Banyan emphasized that once it transfers all of its assets and
liabilities into a liquidating trust, which is expected to occur
on December 31, 2002, there will be no further trading in
Banyan's shares of beneficial interest. In order to fund the
litigation and other operations of the liquidating trust and to
maintain adequate reserves, Banyan indicated that there would be
no distribution to shareholders of any portion of the net
proceeds of the Northlake disposition.  Instead, all funds
remaining on hand at the completion of the litigation and
conclusion of the liquidating trust will be distributed to
shareholders at that time.

Banyan Strategic Realty Trust -- http://www.banyanreit.com-- is  
an equity Real Estate Investment Trust that adopted a Plan of
Termination and Liquidation on January 5, 2001. On May 17, 2001,
the Trust sold approximately 85% of its portfolio in a single
transaction. Other properties were sold on April 1, 2002, May 1,
2002 and October 15, 2002.  Banyan intends to dissolve on
December 31, 2002 and, on that date, to transfer all of its
remaining assets and liabilities into a liquidating trust.  
There will be no further trading of Banyan's shares of
beneficial interest after the formation of and transfer to the
liquidating trust.  Since adopting the Plan of Termination and
Liquidation, Banyan has made liquidating distributions totaling
$5.45 per share.   As of this date, the Trust has 15,496,806
shares of beneficial interest outstanding.


BIRMINGHAM STEEL: Court OKs Ernst & Young Retention as Auditors
---------------------------------------------------------------
Birmingham Steel Corporation and its debtor-affiliates sought
and obtained approval from the U.S. Bankruptcy Court for the
District of Delaware to retain Ernst & Young LLP as their
Auditor, nunc pro tunc to June 3, 2002.

The professional services that Ernst & Young will render
include:

  a) Assisting Debtors in their record keeping and compliance
     duties, including assisting in identifying, obtaining and
     safeguarding key accounting records, and assisting in the
     preparation of financial statements;

  b) Performing any and all general accounting services required
     by the Debtors in connection with the Debtors' bankruptcy
     cases;

  c) Performing any and all other accounting services required
     by the Debtors as part of their general business operation;
     and

  d) Conducting any other activities and providing other
     information and assistance as the Debtors or their
     bankruptcy counsel may deem necessary.

The Debtors will compensate Ernst & Young at the Firm's current
hourly rates:

        Partners and Principals   $480 - $500 per hour
        Senior Managers           $380 - $420 per hour
        Managers                  $250 - $316 per hour
        Seniors                   $155 - $168 per hour
        Staff                     $107 - $130 per hour

Birmingham Steel Corporation manufacture and distribute steel
for construction industry and merchant steel products for
fabricators and distributors across North America. The Company
filed for chapter 11 protection on June 3, 2002. James
L. Patton, Esq., Michael R. Nestor, Esq., Sharon M Zieg, Esq.,
at Young Conaway Stargatt & Taylor, LLP and John Whittington,
Esq., Patrick Darby, Esq., Lloyd C. Peeples III, Esq., at
Bradley Arant Rose & White LLP represent the Debtors in their
restructuring efforts. When the Company filed for protection
from its creditors, it listed $487,485,834 in assets and
$681,860,489 in total debts.


BUDGET GROUP: Bags Nod to Settle Prepetition Franchisee Claims
--------------------------------------------------------------
Budget Group Inc., and its debtor-affiliates obtained permission
from the U.S. Bankruptcy Court for the District of Delaware to
maintain, in the ordinary course of business, their fully
integrated business relationship with their franchisees,
licensees and dealers operating in North America, Europe, the
Middle East, Africa, the Caribbean, Latin America, Asia and the
Pacific Rim -- excluding Australia and New Zealand -- through
payment, setoff or recouping of prepetition amounts due to them.

The Debtors estimate that the prepetition amounts owed to the
franchisees aggregate $2,350,000, while the franchisees owe the
Debtors an estimated $17,050,000.  In addition to these amounts,
for the certain select markets in which the Debtors act as sub-
licensees to a master franchiser, the Debtors estimate the net
prepetition amounts owed to the master franchisers at
$1,950,000. In the markets in which the Debtors provide an
electric vehicle product, the Debtors estimate that the net
prepetition amount owed to EV Rentals is $230,000.  The Debtors
peg the prepetition amounts owed to the dealers at $12,470,000,
while the dealers owe an estimated $6,300,000 to the Debtors.
(Budget Group Bankruptcy News, Issue No. 9; Bankruptcy
Creditors' Service, Inc., 609/392-0900)    

DebtTraders reports that Budget Group Inc.'s 9.125% bonds due
2006 (BD06USR1) are trading at 17 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=BD06USR1for  
real-time bond pricing.


CENTRAL RECYCLING: Sells Scrap Facility for Non-Ferrous Metals
--------------------------------------------------------------
Tranzon Driggers announced the immediate sale of Central
Recycling, Inc., in Clearwater, FL. The Scrap Facility for non-
ferrous metals has been ordered Sold by Sealed Bid Auction by
the U.S. Bankruptcy Court, the Honorable Chief Judge Thomas E.
Baynes, Jr. presiding (Case No. 01-23423-8B7).  

"This long established industry has evolved from a regional
business into the global market, with greater price and
availability factors; it is an exciting opportunity," said
Sharon Lefler, Marketing Coordinator for Tranzon Driggers, the
auction company coordinating the event.

Central Recycling, Inc., has state of-the-art scrap metals
capabilities. Established since 1986, at 15122 63rd St. N.,
Clearwater, FL 33760, this business site also benefits from its
close proximity to St. Petersburg, Tarpon Springs, and Tampa,
with easy access to major thoroughfares.  This auction includes
three individual parcels; the recycling center with trucks &
equipment as a turn-key business opportunity, an abutting
property with home, and vacant lot across from the center; to be
sold individually or as one.

The Assets of Central Recycling, Inc., are being sold via Sealed
Bid subject to Bankruptcy Court approval. Bidders must deliver
sealed bids together with a good faith deposit of 10% of the
full purchase price to Tranzon Driggers on or before Monday,
October 28, 2002 at 3:00 PM E.T.  Those interested in bidding on
the assets of Central Recycling, Inc. are invited and encouraged
to attend the preview scheduled on Monday, October 21, 2002 from
12:00 PM to 2:00 PM E.T.

Contact:  Sharon Lefler, Marketing Coordinator, Tranzon
Driggers, Auction & Marketing Specialists, of Hernando, FL, at
352-726-1047 or slefler@tranzon.com


CHAMPION ENTERPRISES: Third Quarter Net Loss Balloons to $39MM
--------------------------------------------------------------
Champion Enterprises, Inc. (NYSE: CHB), the nation's leading
housing manufacturer, reported results for its third quarter
ended September 28, 2002.  For the quarter, Champion had total
revenues of $374 million and a net loss of $38.9 million in
2002, compared to $428 million of revenues and net income of
$2.5 million in 2001.  For the nine months ended September 2002,
the company reported revenues of $1.0 billion and a net loss of
$250.1 million.  For the nine months ended September 2001,
Champion had net sales of $1.2 billion and a net loss of $23.1
million.  Goodwill amortization expense for the three and nine
months ended September 2001 was $2.2 million after tax and $6.6
million after tax, respectively.

Excluding restructuring charges of $42.9 million ($30.4 million
after tax), the company had a net loss of $8.5 million for the
three months ended September 2002.  These charges were to close
65 retail sales centers, close and consolidate seven
manufacturing facilities and adjust certain development
investments to fair market value.  Closing-related expenses
consisted of $33.4 million for non- cash asset impairment
charges, $3.5 million for warranty costs, $2.1 million for
severance costs, $1.8 million for lease termination costs and
$2.1 million for miscellaneous expenses.  In addition, the
company recorded a pretax charge of $5.6 million to adjust its
self-insurance reserves based on an actuarial study completed by
an independent third party during the third quarter.  For the
year-to-date period of 2002, Champion had a net loss of $29.8
million, excluding closing- related expenses and the second
quarter's gain on debt retirement and charges for goodwill
impairments and deferred tax asset valuation allowance.

Chairman, President, and Chief Executive Officer, Walter R.
Young, commented, "We're encouraged that our 116 ongoing retail
stores were at breakeven this quarter.  As we manage for cash,
retail operations reduced inventories by 635 new homes, or 21%
of the June 2002 balance.  We're pleased that our manufacturing
operations continued to be profitable excluding closing-related
expenses.  In addition, HomePride's growth continues at a
controlled pace with high quality loans."

                              Operations

Manufacturing - For the quarter, wholesale revenues decreased
17% to $302 million from $362 million one year earlier.  
Manufacturing segment income was $14.1 million excluding $26.3
million of plant closing costs and $5.6 million of self-
insurance reserves.  Closing-related expenses consisted of $21.0
million for non-cash asset impairment charges, $3.5 million of
additional warranty costs and $1.8 million for severance
expenses.  The segment reported income of $25.9 million in the
third quarter of 2001.

For the nine months ended September, manufacturing had segment
income of $25.8 million, excluding the $26.3 million of closing-
related expenses and the insurance reserve adjustment, in 2002,
compared to $38.1 million, excluding $3.3 million of impairment
charges, in 2001.  Champion had unfilled wholesale orders of $41
million at 39 plants this September, compared to $54 million at
49 plants a year earlier.  On a per plant basis, unfilled orders
were down 5% year-over-year, but up 86% from this year's second
quarter.  Losses related to independent retailer defaults in the
first nine months dropped to $0.9 million in 2002 from $3.5
million in 2001.

Retail - For the quarter, retail revenues were $105 million,
down 12% from a year ago, and the segment had a loss of $5.6
million excluding closing- related expenses.  In the third
quarter of 2001, retail operations had revenues of $120 million
and reported a loss of $6.1 million.  Third quarter same store
sales were flat from a year ago, while the average number of new
homes sold per sales location increased 17% due to the closing
of under performing retail locations.

Since the beginning of the year the company has closed 102
retail locations.  Pretax charges to close retail locations
totaled $14.0 million in this year's third quarter, consisting
of $11.3 million for non-cash asset impairment charges, $1.8
million for lease termination costs and $0.9 million for other
closing expenses.  For the nine-month period, pretax charges for
retail closing-related expenses were $18.9 million, including
$13.2 million of non-cash asset impairment charges, $3.0 million
for lease termination costs and $2.7 million for other closing
expenses.

Finance - HomePride Finance Corp., originated $22.7 million of
loans for the quarter and $28.9 million year-to-date.  The
company received $17.9 million of proceeds for $23.6 million of
loans placed in the warehouse facility.

Corporate - General corporate expenses for the quarter include
$300,000 of severance costs and a $2.3 million restructuring
charge related to development investments, of which $1.1 million
was a non-cash asset impairment charge. Champion sold its
interest in the SunChamp joint venture, which consisted of 11
leased communities, to Sun Communities as of October 1, 2002.  
With Sun's purchase of the joint venture's debt, both parties
decided that it was in the best interest of all involved to sell
to Sun.  Champion will continue to sell homes in these
properties.

                  Liquidity and Capital Structure

Champion ended the quarter with $92.4 million in unrestricted
cash and $37.1 million in restricted cash primarily for letter
of credit collateral. For the three-month period, the company
generated $17.9 million in cash flow from operations, consisting
primarily of new home inventory liquidations. EBITDA losses
related to closed manufacturing and retail locations totaled
$8.6 million in the third quarter of 2002 and $21.2 million in
the year-to-date period.  Excluding closing-related expenses and
EBITDA losses at closed plants and retail centers, the company
had adjusted EBITDA of $8.8 million for the third quarter of
2002 compared to $22.9 million in the same quarter a year ago.

Total debt outstanding at September 28, 2002 was $354.4 million,
excluding $17.9 million outstanding under the warehouse line.  
During the quarter the company amended its $150.0 million
warehouse line that supports HomePride's operations and a $15.0
million floor plan facility to allow more flexible covenants.  
At the end of September, the company had $9.2 million
outstanding on its $30.0 million of total available floor plan
credit lines.  The company is in compliance with all debt
covenants.  In October Champion entered into an agreement to
provide an additional $13.1 million in letters of credit, which
will be cash collateralized, to its largest surety bond
provider.  During the year-to-date period, $30.0 million in
Senior Notes due 2009 were retired for $23.8 million, resulting
in a gain of $0.07 per diluted share.

                          Industry View

Year-over-year industry wholesale shipments declined 7.9% in the
first eight months of 2002 and 14.9% in July and August.  For
the year the company estimates industry wholesale shipments of
170,000 homes, down 12% from 2001 levels, and substantially
below the peak of 373,000 in 1998.  Champion estimates 2002
industry retail sales of 195,000 new homes, down 8% from 2001
levels.  These estimates are based on industry new home
inventory dropping by 25,000 homes this year.  The company
estimates that cash and land home/real estate mortgages now
represent at least 60% of industry consumer funding.

                       Corporate Governance

The company also announced that its Board of Directors has
formed a nominating committee.  In addition, the Board of
Directors has voted to rescind the 1996 Shareholders Rights Plan
as of December 31, 2002.

                             Outlook

Young concluded, "As we enter the seasonally slow fourth and
first quarters, we will continue to evaluate all locations so
that we maximize profitability and liquidity.  Our actions in
the third quarter better position us for the months ahead, but
we still expect to report losses for the next two quarters.  
While we continue to focus on liquidity and cash flow during
this period, we are positioning the company for the industry's
eventual upturn with the actions we are taking to work through
this remaining down cycle."

Champion Enterprises, Inc., headquartered in Auburn Hills,
Michigan, is the industry's leading manufacturer and has
produced nearly 1.6 million homes since the company was founded.  
The company operates 37 homebuilding facilities in 16 states and
two Canadian provinces and 116 retail locations in 24 states.  
Independent retailers, including 636 Champion Home Center
locations, and approximately 600 builders and developers also
sell Champion- built homes.  The company also provides financing
for retail purchasers of its homes.  Further information can be
found at the company's Web site.  

                          *     *     *

As reported in the Troubled Company Reporter's Aug. 20, 2002
edition, Standard & Poor's Ratings Services placed its ratings
on Champion Enterprises Inc., and its subsidiary, Champion Home
Builders Co., on CreditWatch with negative implications. The
CreditWatch placements follow Champion's announcement
that it will incur significant restructuring charges as it
attempts to further rationalize its operations in the face of a
prolonged recession in the manufactured home building industry.

The manufactured housing industry has entered its fourth year of
a down cycle that was initially caused by poor lending
practices. A previously anticipated recovery continues to be
forestalled by the persistent scarcity of retail consumer
financing. According to the Manufactured Housing Institute,
manufactured home shipments were down another 2.6% during the
first five months of 2002. The Institute's current projections
of relatively flat shipments for the full year 2002 now appear
overly optimistic, given the continued limited availability of
consumer financing, and in particular, the present difficulties
faced by Conseco Inc. ('SD'), the nation's largest supplier of
retail consumer financing for the manufactured housing industry.

             Ratings Placed On CreditWatch Negative

                                           Rating
                                     To               From
      Champion Enterprises Inc.
        Corporate Credit Rating          BB-/Watch Neg     BB-
        $200 mil. 7.625% senior unsecured
        notes due 2009                   B/Watch Neg       B
      Champion Home Builders Co.
        Corporate Credit Rating          BB-/Watch Neg     BB-
        $150 mil. 11.25% senior unsecured
        notes due 2007                   B/Watch Neg       B

Champion Enterprises Inc.'s 7.625% bonds due 2009 (CHB09USR1)
are trading at 30 cents-on-the-dollar, DebtTraders reports. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=CHB09USR1for  
real-time bond pricing.


COMMUNICATION DYNAMICS: Gets Okay to Use Interim Cash Collateral
----------------------------------------------------------------
Communication Dynamics, Inc., the parent company of TVC
Communications, has received Bankruptcy Court approval for
continued use of interim cash collateral.  The Company will seek
final approval for use of cash collateral at the final hearing
scheduled for November 6, 2002.

"The Company is pleased to have received approval of further use
of interim cash collateral and we look forward to working with
our lenders and the Creditors' Committee in advance of our
hearing on November 6," said Robert W. Ackerman, CDI's president
and chief executive officer.

CDI has increased its cash position by more than $4 million
since it announced on September 23, 2002 that it began the
process of restructuring its debt and operations by filing for
reorganization under Chapter 11 of the U.S. Bankruptcy Code.  
The Company has been authorized to purchase inventory in the
amount of $19.8 million for the period Sept. 23, 2002 to Nov. 6,
2002.

"We are happy with the supportive response from our vendors and
customers," said Ackerman.  "We value our long-term
relationships with our business partners and are working closely
with them to ensure they continue to receive the same level
service to which they are accustomed."

Communication Dynamics, Inc., is the parent company of TVC
Communication.  TVC provides the products and services that have
helped build the communications infrastructure in the United
States, Canada, South America and Europe.

Founded in 1952, TVC is backed by close working relationships
with top manufacturers and a deep understanding of the
technology behind the products it sells.  TVC has proven itself
to be a valued partner to both the broadband cable and
telecommunications industries.

For further information please contact Brenda Adrian, +1-310-
788-2850, or Dana Coleman, +1-212-573-6100, both of Sitrick And
Company, for Communication Dynamics, Inc.


COMPUSPORT LLC: Will Auction Off Assets on November 4, 2002
-----------------------------------------------------------
An auction of substantially all of CompuSport LLC's assets,
including intellectual property, will be held at the U.S.
Bankruptcy Court for the District of Nevada on November 4, 2002
at 1:30 p.m., Pacific Time under the supervision of the
Honorable Robert Clive Jones.

Only qualified bids, conforming with the previously approved
uniform Bidding Procedures will be eligible for participation at
the auction.  The Deadline for submitting a bid is October 30,
2002.

Any winning bid will be subject to the approval of the Court.  A
hearing to approve the winning bid will be held simultaneously
with a Motion to approve the Sale Transaction under Sec. 363 of
the Bankruptcy Code.  

A.J. Kung, Esq., represents the Debtor as it liquidates.


CONSECO, INC.: Banks Agree to Forebear until Nov. 26, 2002
----------------------------------------------------------
Lenders to Conseco, Inc. (OTCBB:CNCE) executed a Forbearance
Agreement granting the Company waivers of certain covenant
violations through November 26, 2002.   The Forbearance
Agreement grants Conseco a contining temporary waiver by its
senior lenders of certain cross-default provisions under the
Company's credit agreement and non-compliance with a 0.400:1.0
debt to capitalization ratio covenant as of June 30, 2002, as
well as a limited waiver of potential non-compliance of a
0.375:1.0 debt to capitalization ratio covenant as of September
30, 2002.  Similar forbearance agreements, Conseco says, were
also executed on the various loans guaranteed by the company
under the 1997, 1998 and 1999 Directors and Officers (D&O) Loan
Programs.

The Wall Street Journal reported earlier this month that the Ad
Hoc Noteholders' Committee is demanding full ownership of the
company.  The Journal's sources say that "because Conseco's
debts exceed estimates of the company's value, its bondholders
are likely to gain at least a controlling stake in the
restructured company."  

The Ad Hoc Noteholders' Committee is also credited with forcing
Gary Wendt to step down as Conseco's CEO.  The Journal says that
"a representative of the bondholders told the restructuring  
committee of Conseco's board that Mr. Wendt's 'usefulness had
come and passed and we want him gone,' according to one person
at [a] meeting [a couple of weeks ago]."

Journal reporters Mitchell Pacelle and Joe Hallinan relate that
bondholders have presented the company with a written proposal
demanding full ownership of the restructured company . . . but
might be willing to give a nominal amount of warrants to
existing equity holders.  

Standard & Poor's Ratings Services has revised all of Conseco's
counterparty credit ratings to 'D' (default) from 'SD'
(selective default).  Standard & Poor's also lowered senior debt
and preferred stock ratings on Conseco to 'D' from double-'C'.
The single-'B'-plus counterparty credit and financial strength
ratings on Conseco's insurance subsidiaries remain on Credit
Watch with negative implications, where they were placed on
Aug. 9, 2002.

"The 'D' rating reflects Standard & Poor's view that Mr. Wendt's
resignation is a prelude to an ultimate bankruptcy filing,"
explained Standard & Poor's credit analyst Jayan U. Dhru.
"Therefore, Standard & Poor's expects that Conseco's future
payments on principal and interest will be adversely affected."

The ratings on the insurance entities will remain on CreditWatch
until there is more clarity about the impact of the parent
company's travails on the insurance operations. Standard &
Poor's believes the insurance policyholders have a priority over
the debtholders and that the regulators are ensuring that
appropriate risk-based capital is maintained at the operating
companies.


CROWN CORK & SEAL: Reports Improved Results for Third Quarter
-------------------------------------------------------------
Crown Cork & Seal Company, Inc., (NYSE: CCK) announced its
results for the third quarter and nine months ended September
30, 2002.

Third quarter net income from continuing operations increased
sharply to $0.34 per diluted share compared to a loss of $0.10
per diluted share in the third quarter of 2001.  On an as-
reported basis, third quarter net income rose to $0.45 per
diluted share after an extraordinary gain of $0.02 per diluted
share on the early extinguishment of debt compared to the loss
of $0.10 per diluted share reported for the third quarter of
2001.  Year-to-date, net income from continuing operations was
$0.61 per diluted share compared to a net loss of $0.42 per
diluted share for the first nine months of 2001.  For the nine
months ended September 30, 2002, after an extraordinary gain of
$0.20 per diluted share on the early extinguishment of debt and
a non-cash charge of $7.32 per diluted share for the impairment
of goodwill recorded as a cumulative effect of a change in
accounting, the as-reported result was a net loss of $6.73 per
diluted share.

Net sales in the third quarter were $1.9 billion compared to
$2.0 billion in the third quarter of 2001, reflecting divested
operations which accounted for $55 million in the third quarter
of 2001, the pass-through of lower raw material costs, and
volume decreases in certain product lines. These factors were
partially offset by the positive effects of $64 million in
stronger foreign currencies as well as increased selling prices
and improved volumes across certain product lines.

Gross profit (net sales less cost of products sold) as a
percentage of net sales in the third quarter increased to 18.7%
compared to 15.4% in the same period last year.  The improvement
resulted from price increases, improved operating performance
and continuing cost-reduction efforts.

Third quarter operating income increased to $165 million, or
8.7% of net sales, an improvement of 47.3% over the $112
million, or 5.6% of net sales, reported in the 2001 third
quarter.  Excluding the impact of goodwill amortization from
last year's third quarter results and non-cash pension
expense/income from both the third quarter of 2002 and 2001,
respectively, operating income increased to $173 million, or
9.1% of net sales. This reflected an improvement of $45 million,
or 35.2% over operating income in last year's third quarter of
$128 million, or 6.4% of net sales.

For the nine months, after excluding goodwill amortization and
pension expense/income, operating income was $448 million, or
8.5% of net sales. This was an improvement of $92 million or
25.8% over operating income in the comparable period last year
of $356 million, which was 6.4% of net sales.

John W. Conway, Chairman and Chief Executive Officer, commented,
"During the quarter, we drove continued improvement across all
divisions, as shown by the measures we consider important to
this Company's success.  Productivity was improved and costs
were tightly controlled.  Working capital was managed carefully
and showed substantial improvement compared to the prior year.  
The pricing environment and associated margins are stable to
improving, and industry fundamentals in the regions in which we
operate continued to be good."

In the Americas Division operating income in the third quarter
increased to 7.9% of net sales over the 4.6% in last year's
third quarter.  Excluding the impact of goodwill amortization
from the prior year and non-cash pension expense from both the
2002 and 2001 third quarters, operating income rose to 9.6% of
net sales compared to the 6.1% in the third quarter of 2001. For
the nine months ended September 30, 2002, operating income
increased to 9.2% of net sales compared to 5.8% in the
comparable period a year ago.

In the European Division operating income in the third quarter
increased to 12.0% of net sales from 9.0% in last year's same
quarter.  Excluding the impact of goodwill amortization from the
prior year and non-cash pension income from both the 2002 and
2001 third quarters, operating income improved to 11.2% of net
sales in the quarter from 9.1% in the prior year period. Year-
to-date, operating income increased to 10.2% of net sales
compared to 9.7% for the same nine-month period of 2001.

In the Asia-Pacific Division, third quarter operating income
improved to 12.8% of net sales from 9.4% in the third quarter
last year. In the nine-month period operating income increased
to 11.7% of net sales compared to 7.9% for the same period of
2001.

Mr. Conway added, "Notwithstanding our excellent operating
performance through the first nine months, we remain focused on
strengthening our balance sheet through debt reduction.  
Consistent with the delevering strategy we outlined last year,
total debt declined by more than $1.0 billion to $4.6 billion at
the end of the third quarter versus $5.6 billion on September
30, 2001.  Business cash flow (cash flow from operations less
capital expenditures) continued to improve compared to the prior
year with $196 million generated in the third quarter of 2002
compared to $112 million in the same prior year period.  Through
the first nine months our businesses generated cash of $138
million compared to using cash of $223 million for the nine
month period last year."

Net interest expense in the third quarter was $82 million, down
$31 million from the same period last year.  The decrease
reflects both lower average debt outstanding and lower average
borrowing rates.

During the third quarter, the Company recorded a tax credit of
$24 million from the carryback of U.S. tax losses.

As previously announced, effective January 1, 2002, the Company
adopted "SFAS 142," the accounting pronouncement which requires
that goodwill and certain other long-lived intangible assets no
longer be amortized but be assessed for impairment, at least
annually.  Amortization of goodwill amounted to $28 million
($0.22 per diluted share) in the third quarter of 2001 and $85
million ($0.68 per diluted share) for the nine months ended
September 30, 2001.

The Company entered into privately negotiated debt for equity
exchanges with holders of the Company's outstanding notes during
the third quarter, with 9.0 million shares of common stock
exchanged for $61 million of debt and $1 million of accrued
interest.  Through September 30, 2002, the Company exchanged
33.4 million shares of common stock for $271 million of
principal amount outstanding notes plus $6 million of accrued
interest.  The Company recorded an extraordinary gain on the
early extinguishment of debt, net of tax, of $3 million ($0.02
per diluted share) in the third quarter of 2002 and $28 million
($0.20 per diluted share) for the nine months ended September
30, 2002.

Crown Cork & Seal's 8.375% bonds due 2005 (CCK05USR1),
DebtTraders reports, are trading at 68 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=CCK05USR1for  
real-time bond pricing.


CUMMINS: S&P Drops Rating to BB- Amid Adverse Market Conditions
---------------------------------------------------------------
Standard & Poor's Rating Services lowered its corporate credit
rating on Cummins Inc., a leading producer of heavy- and medium-
duty truck engines and power generation equipment, to double-
'B'-plus from triple-'B'-minus.

At the same time, Standard & Poor's removed the rating from
CreditWatch were it was placed September 25, 2002. The outlook
is now negative. As of June 30, 2002, Cummins had approximately
$925 million in rated debt securities outstanding.

"As a result of declining power generation sales and weak heavy-
and medium-duty truck demand, Cummins' financial results are
well below Standard & Poor's expectations," said Standard &
Poor's credit analyst Eric Ballantine.

Although near-term financial results are expected to show a
temporary improvement related to the "pre-buy" of truck engines
resulting from the October 1, 2002, emission standard deadline,
sustained improvement is not expected until late 2003.
Additionally, power generation sales continue to soften due to
the weak industry fundamentals.

Cummins continues to focus on improving its cost structure by
reducing excess overhead, consolidating facilities, and
improving its global sourcing of components. These initiatives
should help improve the company's financial performance in the
longer term. Cummins' good geographic diversity, with about 47%
of sales generated outside the U.S., partially mitigates
regional economic volatility. Outsourcing, tight cost controls,
and significant investments in production efficiency have
improved the company's ability to weather market volatility.

If market conditions remain depressed beyond current
expectations, further stretching the company's financial
profile, the ratings could be lowered.


DELIA*S CORP: Taps Peter J. Solomon to Evaluate Alternatives
------------------------------------------------------------
dELiA*s Corp. (Nasdaq:DLIA), a leading multichannel retailer to
teenage girls and young women, announced that the company has
retained Peter J. Solomon Company to explore and evaluate
strategic alternatives for the company.

Stephen Kahn, Chief Executive Officer, stated, "Our decision to
explore strategic alternatives reflects the Board's commitment
to maximizing shareholder value."

There can be no assurance that the company's review of strategic
alternatives will result in a transaction.

dELiA*s Corp., is a multichannel retailer that markets apparel,
accessories and home furnishings to teenage girls and young
women. The company reaches its customers through the dELiA*s
catalog, http://www.dELiAs.comand its 65 dELiA*s retail stores.


DESA HOLDINGS: Has Until Dec. 5 to Make Lease-Related Decisions
---------------------------------------------------------------
DESA Holdings Corporation and its debtor-affiliates sought and
obtained an extension from the U.S. Bankruptcy Court for the
District of Delaware of their lease decision period.  The Court
determined that the extension is essential to the continued
operation of the Debtors' businesses and in the best interest of
the Debtors' estates and parties in interests.  The Debtors have
until December 5, 2002 to determine whether to assume, assume
and assign, or reject unexpired nonresidential real property
leases.

DESA, a leading manufacturer, distributor and marketer of vent-
free heating appliances, outdoor heaters, motion sensor
lighting, wireless doorbells, lawn and garden electrical
products and consumer fastening systems in the United States,
filed for chapter 11 protection on June 8, 2002. Laura Davis
Jones, Esq., at Pachulski, Stang, Ziehl Young & Jones represents
the Debtors in their restructuring efforts.


DICE INC: Sept. 30 Balance Sheet Insolvency Widens to $37 Mill.
---------------------------------------------------------------
Dice Inc. (Nasdaq: DICE), the leading provider of online
recruiting services for technology professionals, reported
results for the quarter ended September 30, 2002.

                       Quarterly Results

Revenues for the quarter were $7.8 million, a decrease of 7%
compared to the $8.4 million recorded in the second quarter of
2002 and a decrease of 40% compared to the year ago quarter.

Earnings before interest, taxes, depreciation and amortization
totaled $63,000 for the quarter, compared to $213,000 in the
second quarter of this year and $2.0 million in the third
quarter of 2001.  In each period, EBITDA excludes the one-time
items described below.

In the current quarter, Dice Inc. recorded a net loss of $2.4
million, excluding amortization of intangibles of $615,000, one-
time charges totaling $3.8 million for the noteholder options
purchased in April 2002 and an arbitration award announced in
August 2002, and a previously deferred gain of $488,000 on the
repurchase of convertible notes.  Including amortization, one-
time charges, and the net gain, the net loss was $6.4 million.  
In the second quarter, the company reported a net loss of $2.4
million, excluding amortization of intangibles of $615,000.  In
the year ago quarter, Dice Inc. recorded a net loss of $228,000,
excluding amortization of goodwill and intangibles of $4.2
million and a net gain of $5.6 million on the repurchase of
convertible notes.

The revenue decrease compared to the prior quarter and to the
third quarter of 2001 reflected the impact of a continued weak
business environment on demand for technology job postings from
customers and the cumulative impact of net decreases in the
number of customer accounts over the previous year. The total
subscription customer base declined by 7% in the third quarter
to approximately 2,600 from approximately 2,800 at June 30,
compared to a 24% sequential decline in the year ago quarter,
and to a 4% sequential decline in the June 2002 quarter.  The
new Classified product line, launched in the second half of
2001, has been sold to nearly 1,100 customers since January 1.

Dice continued to tighten its cost structure, while launching
the new version of its website and expanding its reach in a
broader array of technology disciplines. Cost of revenues and
operating expenses (excluding depreciation, amortization and
one-time charges) were $450,000 less than in the previous
quarter and $3.2 million less than a year ago, a year over year
reduction of 29%.

At September 30, 2002, the Company's total shareholders' equity
deficit widens to about $37 million.

                    Comments from Management

"In September, we launched a new version of our dice.com
recruiting Web site, providing greater access to our tech talent
pool as well as new features to our job seekers," said Scot W.
Melland, Chairman, President and CEO of Dice Inc. "At the same
time, we have broadened our reach into additional areas within
the technology sector, and have recently launched DiceDiversity,
a new program to help customers attract qualified technology
candidates from diverse backgrounds.

"Labor markets have continued to be vulnerable in this period of
economic uncertainty," Melland continued.  "Even though the
business environment is difficult, we are continuing the
strategic review process we launched in the spring. While we did
not exercise the noteholder options, we continue to actively
pursue a full range of strategic alternatives because we believe
it is important for our company to create the best long term
capital structure for our business and for us to manage our
future proactively in this consolidating industry."

Michael P. Durney, Senior Vice President and CFO of Dice Inc.,
commented further, "We continue to demonstrate the ability to
manage the cost structure of the business in difficult markets
to maximize our operating profit line. We focus on each and
every cost in our business relentlessly.  Our cost control has
enabled us to generate, once again, positive EBITDA, as well as
to invest our capital where it matters most, namely, launching
the new version of dice.com.

"We are winning new subscription customers to nearly offset the
decline in total customers resulting from reduced hiring needs
or rapidly filled jobs. At the same time, we are seeing a steady
expansion in our classified customer base -- as this product
better serves today's more limited hiring needs for many
customers.  Coupled with the reduced cost structure, we are
firmly positioned to reap gains from this greater operating
leverage when our customers' hiring needs increase.  As further
evidence of the continuing trend of stabilization, our deferred
revenue has remained above $5 million throughout 2002.

"Our $9 million in cash is more than sufficient to manage
through this cyclical trough in the labor markets while
servicing the carrying costs on the convertible notes due in
2005," Durney continued.

                      Dice.com Customer Wins

Dice attracted 670 new and returning subscription customers in
the current quarter, compared to 720 last quarter and 620 in the
third quarter of 2001, with customer retention rates remaining
comparable to the first and second quarters of 2002.  New and
returning subscription customers during the quarter included
Rockwell Collins, Matsushita Avionics Systems, Baxter
BioScience, Boeing, and Compaq. In the Classified product line,
Dice continued to demonstrate success in broadening its
awareness among direct employers, with new and repeat orders
booked from a wide range of customers.

                         New Site Launch

In September, Dice launched a new version of its website, adding
features and functionality designed to give job seekers and
customers faster, more efficient tools and more control over
their job search or recruiting experience.

The new site provides greater access to a larger and broader
tech talent pool, a new and improved look and feel, and a series
of features that make the site more useful to both customers and
job seekers.  A key new customer benefit is the ability to
search the database for passive job seekers -- candidates who
are not actively looking, but willing to consider the right
opportunity.  This group represents a significant new addition
of searchable, unique tech skills, and further enhances the
quality of talent Dice provides to its customers.  Job seekers
can also elect to remain confidential and can take advantage of
many job search enhancements -- all designed to streamline
users' experience with the site.

Capital expenditures totaled $729,000 for the three months ended
September 30, 2002, the majority of which was related to
development of and hardware purchases for the new version of the
dice.com website launched this quarter.

                  Other Items during the Quarter

During the quarter, Dice recorded a $1.0 million charge for the
arbitration award announced in August 2002 relating to the
purchase of certain websites by EarthWeb Inc. (now known as Dice
Inc.) in 1999 from Mr. Scott Wainner.  Dice has not made any
payment on this award, and is seeking to recover that amount
from Jupitermedia Corporation (formerly known as INT Media and
internet.com) under the terms of the Asset Purchase Agreement of
December 2000 pursuant to which Jupitermedia acquired these
websites from the company. The probability of recovery is not
determinable, and thus the entire amount of the award was
recorded as an expense in the third quarter. The company also
recorded a previously deferred gain of $488,000 (net of deferred
financing costs) from the repurchase of $1.76 million in
convertible subordinated notes for $1.24 million in cash in
April 2002 and a charge of $2.8 million reflecting the cost of
the option agreements with three bondholders announced in April
2002, as the options were not exercised prior to their
expiration on October 3, 2002.

The company recorded a charge related to the early termination
of a portion of its lease in Des Moines, which will be paid
during 2003 through 2007, and a charge for severance, which will
be paid in the fourth quarter of 2002.  These and other small
items were partially offset by the favorable resolution of
outstanding liabilities from the content business and the
reversal of a portion of the accruals for year-end bonuses
recorded earlier in 2002. The net expense from these items was
$175,000, which is included in EBITDA.

                    Current Business Outlook

Many external economic indicators have continued to show
weakness in the labor markets and corporate spending overall.  
Dice currently anticipates that revenues for the fourth quarter
of 2002 will be $7.1 to $7.3 million, with an EBITDA loss of
$0.5 to $0.7 million and a net loss of $3.3 to $3.5 million,
excluding amortization of intangibles of $615,000. The company's
cash balance is anticipated to be $8.0 to $8.5 million at the
end of December, excluding the impact of any payment related to
the Wainner arbitration award.

                     NASDAQ Notification

Dice received a NASDAQ Staff Determination on October 8, 2002,
indicating that the Company fails to comply with the $3.00
minimum bid price requirement for continued listing set forth in
Marketplace Rule 4450(b)(4) and that its common stock is,
therefore, subject to delisting from the NASDAQ National Market.
On October 15, 2002, the company requested a hearing before a
NASDAQ Listing Qualifications Panel to review the Staff
Determination.  There can be no assurance that the Panel will
grant the Company's request for continued listing. Throughout
the review process, Dice's common stock will continue to be
listed on the NASDAQ National Market.

Dice Inc., (Nasdaq: DICE) -- http://about.dice.com-- is the  
leading provider of online recruiting services for technology
professionals.  Dice Inc. provides services to hire, train and
retain technology professionals through dice.com, the leading
online technology-focused job board, as ranked by Media Metrix
and IDC, and MeasureUp, a leading provider of assessment and
preparation products for technology professional certifications.

Dice Inc.'s corporate profile can be viewed by clicking on
Investor Relations at http://about.dice.com  


DYNEGY: Will Exit Marketing & Trading Business in NA & Europe
-------------------------------------------------------------
Dynegy Inc., (NYSE:DYN) is implementing a restructuring plan
designed to improve operational efficiencies and performance
across its lines of business. In a marked shift, Dynegy will
adopt a decentralized business structure consisting of a
streamlined corporate center and operating units in power
generation, natural gas liquids, regulated energy delivery and
communications.

The company also announced it will exit the marketing and
trading business in the United States, Canada and Europe. In
connection with this exit, President and Chief Operating Officer
and Dynegy board member Steve Bergstrom has decided to resign
and withdraw his name as a candidate for chief executive
officer.

"The objective of the restructuring is to maximize the potential
and profitability of our existing operating divisions by
requiring each business unit to develop its own strategy while
being responsible for its performance and delivering value to
our stakeholders," said Dan Dienstbier, chairman and interim
chief executive officer of Dynegy Inc. "This new structure
allows our divisions to leverage their unique strengths in
operations, customer relationships and leadership, while the
corporate center will be responsible for enabling, monitoring
and measuring success and administering the appropriate
financial and regulatory controls," he added.

"In his many years of service, Steve Bergstrom provided
outstanding leadership and made immeasurable contributions to
our company and the industry," said Dienstbier. "His vision and
knowledge were driving forces in the development of the
marketing and trading business and the creation of an asset-
backed energy delivery network that has served our customers
reliably over the past 17 years."

Steve Bergstrom said, "I fully support the steps leadership is
taking to address current market conditions and position the
company for the future. The new organizational direction is the
right course for Dynegy to take to maximize value to all
stakeholders and to capitalize on its talent pool and excellence
in operational performance."

The restructuring is the result of a detailed assessment of the
company's corporate functions and business units. Concurrent
with the company's ongoing capital and liquidity plan, Dynegy's
leadership conducted a thorough review of its corporate
strategy, the financial performance of each operating division
and its organizational structure and staffing.

The company's operating divisions are Dynegy Generation, Dynegy
Midstream Services, Illinois Power and Dynegy Global
Communications. Each division chief executive officer will
report to Dynegy's new chief executive officer, whom the company
expects to name within the next few weeks. The business units
are as follows:

     --  Dynegy Generation owns and operates approximately
17,500 gross megawatts of domestic and international generating
capacity. Alec Dreyer, president of the company's generation
business since 2000, will serve as chief executive officer of
this unit. Dynegy Generation will continue to focus on
optimizing the company's owned and controlled generation assets
and on the production and delivery of wholesale power.

     --  Dynegy Midstream Services (DMS) ranks as one of North
America's largest natural gas liquids marketers. Steve
Furbacher, president of DMS since 1996, will serve as chief
executive officer. DMS will continue to pursue business
opportunities in areas related to its North American midstream
liquids processing and marketing business and global natural gas
liquids marketing and transportation operations.

     --  Dynegy's regulated utility, Illinois Power (IP),
continues its focus on safe, reliable delivery of electricity
and natural gas to its 650,000 customers across a 15,000-square-
mile area of Illinois. Larry Altenbaumer, IP's president since
1999, will serve as chief executive officer of this unit.

     --  The company's communications division, Dynegy Global
Communications, owns and operates a 16,000-route-mile, optically
switched mesh network reaching 44 U.S. cities. Dynegy continues
to pursue opportunities intended to reduce its financial
exposure in this business. DGC continues operations to meet
current customer commitments and obligations. Ken Snyder, DGC's
current president, will serve as chief executive officer.

Dynegy's corporate center will provide governance, policy,
reporting and control support to the operating divisions.
Corporate center leadership includes: Dan Dienstbier, chairman
and interim chief executive officer; Ken Randolph, executive
vice president and general counsel; Hugh Tarpley, executive vice
president, corporate development; Mike Mott, senior vice
president and chief accounting officer; and Louis Dorey,
executive vice president, finance. Blake Young has been named
executive vice president, technology and administration.
Formerly president of Global Technology, Young will add internal
audit, risk management, corporate communications, human
resources and corporate shared services to his functional areas
of responsibility.

Dynegy intends to exit the marketing and trading business over
the next several months. The company will make appropriate
arrangements with respect to its longer-term contractual
obligations, including retaining personnel and risk management
capabilities and continuing capacity to support its customer
commitments. Matt Schatzman, currently president of commercial
operations, will manage the exit in the United States and Canada
and Mike Flinn, currently president of Dynegy Europe, will
manage the exit in Europe. The decision to exit this business is
expected to reduce the company's collateral requirements and
overall corporate expenses.

As a result of its organizational restructuring and exit from
marketing and trading, the company will undergo a significant
work force reduction. The exact timing, areas affected and
number of employees impacted will be announced in the near
future.

Dynegy Inc., owns operating divisions engaged in power
generation, natural gas liquids, regulated energy delivery and
communications. Through these business units, the company serves
customers by delivering value-added solutions to meet their
energy and communications needs.

Dynegy Holdings Inc.'s 8.75% bonds due 2012 (DYN12USR1),
DebtTraders reports, are trading at 26 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=DYN12USR1for  
real-time bond pricing.


EBIX.COM INC: Stays on Nasdaq SmallCap Pending Hearing Outcome
--------------------------------------------------------------
ebix.com, Inc. (Nasdaq: EBIXD), a leading international supplier
of software and e-commerce solutions to the property and
casualty insurance industry, announced that a NASDAQ Listing
Qualifications Panel has determined to continue listing ebix's
common stock on the NASDAQ SmallCap Market.  The decision
follows ebix's October 3 appeal before the Panel of a NASDAQ
Staff Determination on August 20, 2002 that its common stock was
subject to delisting from the NASDAQ SmallCap Market for failure
to comply with the $1 per share minimum bid price requirement
for continued listing set forth in Marketplace Rule 4310(C)(4).

In reaching its decision, the Panel determined that ebix has
evidenced compliance with the minimum bid price requirement by
demonstrating a closing bid price for its common stock of at
least $1 per share for the 10 consecutive trading days ended
October 14, 2002.  The Panel also noted that ebix appears to
satisfy all other requirements for continued listing on the
NASDAQ SmallCap Market and has demonstrated an ability to
sustain compliance with those requirements over the long term.

Founded in 1976, ebix.com, Inc., formerly known as Delphi
Information Systems, Inc., is a leading international supplier
of software and e-commerce solutions to the property and
casualty insurance industry. The name change to ebix.com, Inc.,
aligns the identity of ebix with its strategic focus of using
the Internet to enhance the way insurance business is
transacted, through solutions that encompass both e-commerce and
web-enabled agency management systems. ebix hosts a one stop
insurance portal for both consumers and insurance professionals.
Recently, ebix launched an end-to-end e-commerce system for
agencies, ebix.ASP, on a self hosted or application service
provided basis, targeted at the personal lines, life, health and
commercial lines agencies and brokers around the world. ebix
hosts a personal line exchange connecting consumers to multiple
agencies and carriers, in addition to providing download, claims
inquiry and billing inquiry services to insurance companies
across more than 30 different agency systems through its
ebixExchange service.  An independent provider, ebix employs
insurance and technology professionals who provide products,
support and consultancy to more than 3,000 customers on six
continents.


ENRON CORP: Asks Court to Allow Settlement with British Energy
--------------------------------------------------------------
On April 1, 1996, Enron Capital & Trade Resources International
Corp. entered into a financially settled electricity derivative
contract with British Energy Generation Limited formerly known
as Nuclear Electric Limited, a wholly owned subsidiary of
British Energy Plc.  On June 19, 1998, ECTRIC assigned all
rights and obligations of the Contract to Enron Capital & Trade
Europe Financial LLC -- a wholly owned non-debtor subsidiary of
ECTRIC -- under a Novation Agreement.

Under the terms of the Contract as novated, British Energy and
ECTEF are to make payments to each other calculated by reference
to a specific pricing index based on a specific market for the
trading of electricity in England and Wales or, in the absence
of an index, on a mutually agreed basis -- the Difference
Payments. The specific pricing index no longer exists, and the
parties have been unable to agree upon an alternative pricing
index.

According to Martin A. Sosland, Esq., at Weil, Gotshal & Manges
LLP, in New York, ECTEF assigned its rights to any Difference
Payments under the Novated Contract on June 26, 1998 to Enron
Cash Company No. 6 LLC in return for a $56,200,000 cash payment.
Also on that date, CashCo 6, pursuant to a Sale Agreement,
transferred an asset equal to the Difference Payments to the
Contractual Asset Securitization Holding Trust VI in return for
a $56,200,000 cash payment from the Cash 6 Trust.  In turn, the
Cash 6 Trust paid ECTRIC a purchase price to enter into four
monthly-settled financial swap agreements with State Street and
Trust Company of Connecticut, National Association, including a
commodity swap, PPI swap, currency swap and interest swap to
eliminate cash flow volatility.

To fund the purchase of the Contractual Asset from CashCo 6 and
to purchase the Swaps, the Cash 6 Trust issued $56,200,000 in
notes to Barclays.  ECTRIC is the servicer of the Contract and
Barclays acts as the administrative agent.  The Difference
Payments service the debt incurred by issuing the Notes.

Mr. Sosland reports that since the Petition Date, ECTRIC has
conducted a review of its operations and has decided to enter
into a Settlement Agreement with British Energy regarding the
termination of the Contract.

Accordingly, ECTRIC sought and obtained the Court's authority
for:

    (a) ECTRIC's execution by and delivery of settlement
        agreement and related agreements by British Energy in
        satisfaction of all the parties' obligations under the
        Swap Agreement; and

    (b) execution by, and delivery of, a letter agreement by
        ECTRIC and ECTEF with CashCo 6, Barclays and State
        Street.

                     Settlement Agreement

Under the Settlement Agreement, British Energy agrees with
ECTRIC and ECTEF that British Energy will immediately make a
Final Termination Payment of GBP51,500,000, subject to certain
adjustments.  Upon British Energy's payment of the Final
Termination Payment, the Parties agree that: (i) each of the
Parties, (ii) British Energy Plc, in respect of the guarantee
dated April 12, 1996 it executed for British Energy's
obligations under the Novated Contract and in respect to the
second guarantee dated July 9, 1998, and (iii) Enron, in respect
of the guarantee dated April 1, 1996 in favor of British Energy
to cover ECTRIC's obligations under the Novated Contract, will
each be released from all of its respective and continuing
obligations, if any, under the Agreement together with the
intent that, effective from Completion, the Agreements will
cease to be of any further force and effect.

Mr. Sosland points out that the Settlement Agreement will
realize the maximum value available under the Contract since the
continued performance of the Contract by the various parties is
being jeopardized by the lack of a mutually agreeable reference
index by which to calculate the Difference Payments.

                        Letter Agreement

ECTRIC, ECTEF, CashCo 6, Barclays and State Street have
negotiated a Letter Agreement, specifying certain terms and
condition:

    -- that must be satisfied before ECTRIC and ECTEF will
       execute and deliver the Settlement Agreement; and

    -- which will govern certain related matters after the
       execution and delivery of the Settlement Agreement.

The Letter Agreement establishes an understanding between the
parties regarding the treatment of the funds received from
British Energy pursuant to the Settlement Agreement.  Moreover,
Mr. Sosland adds, the Letter Agreement will clarify matters
related to the Settlement Agreement, including, among other
things:

    (i) required approvals of the Settlement Agreement and the
        Letter Agreement;

   (ii) obtaining the required consents and agreements;

  (iii) providing for the termination of the Swaps and setting
        forth the terms and provisions related thereto;

   (iv) obtaining Barclay's representations that it is the
        absolute owner of the Note, as defined in the Sale
        Agreement;

    (v) providing for the necessary escrow procedures relating
        to funds credited to the Completion Funds Account; and

   (vi) setting the terms and provisions relating to the
        Completion Funds Account.

Pursuant to Section 363 of the Bankruptcy Code and Rule 9019 of
the Federal Rules of Bankruptcy Procedure, Mr. Sosland contends
that the Debtors' entry into the Agreements is beneficial to the
Debtors because:

    (a) all issues under the Contracts will be resolved without
        any litigation, saving ECTRIC additional and unnecessary
        expense;

    (b) it realizes the value of ECTRIC's assets;

    (c) it eliminates or avoids associated price risks, hedging
        costs, operational risks and any rejection damages
        British Energy could claim in connection with a forced
        rejection of the Contracts; and

    (d) it saves substantial administrative expenses and
        preserves the assets of ECTRIC's estate. (Enron
        Bankruptcy News, Issue No. 45; Bankruptcy Creditors'
        Service, Inc., 609/392-0900)

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


ENVIRONMENTAL SAFEGUARDS: AMEX Halts Trading Effective Oct. 15
--------------------------------------------------------------
Environmental Safeguards, Inc., announced that, pursuant to the
Company's request, The American Stock Exchange suspended trading
of its common stock after the close of trading Tuesday, October
15, 2002.  The stock had traded on the American Stock Exchange
under the symbol EVV.  The suspension is in anticipation of the
forthcoming voluntary delisting requested by the Company in late
August.

James S. Percell, the Company's chairman and president, said
that Environmental Safeguards had applied for a listing of its
shares on the OTC Bulletin Board, and that it was anticipated
that trading in this market would commence shortly.


EOTT ENERGY: Intends to Implement Key Employee Retention Plan
-------------------------------------------------------------
Critical to the success of these Chapter 11 cases is the
stabilization and motivation of Employees at both the corporate
and operational levels, Robert D. Albergotti, Esq., at Haynes
and Boone, LLP, tells the Bankruptcy Court.  Certain of EOTT
Energy Partners, L.P., and its debtor-affiliates' Key Employees
were given assurances by management at the time of the filing of
these cases that the Company would seek court approval of a
retention plan in exchange for the Employees remaining employed
with the EOTT through these reorganization efforts.  The
Critical Employees are Employees whose departure or employment
by a competitor would have an immediate and material impact on
the value and/or operations of the Debtors.  Mr. Albergotti
emphasizes that the Critical Employees are vital to the Debtors'
continued success and reorganization efforts.

The Debtors, therefore, propose three retention and special
compensation programs to encourage and motivate the Employees
identified in the programs to remain employed with the Debtors
through their reorganization efforts and ask Judge Schmidt for
his blessing.

               Special West Coast Retention Program

The Debtors participate in a special West Coast Retention
Program, which was designed to incentivize Employees to continue
employment with EOTT Energy Corp. and to create organizational
stability during the July 1, 2002 through December 31, 2002 six-
month period in order to adequately transition all business
activities to Houston or Bakersfield during the closing of the
Long Beach, California location.  The transition is to be
completed no later than December 31, 2002.  The West Coast
Retention Program was implemented for critical Employees whose
voluntary termination of employment would have a detrimental
impact on the transition of the business activities and
completion of wind up activities in closing the Long Beach
office.

The West Coast Retention Program includes an expense and
obligation for reimbursement of expense for four participants up
to $70,000 in the aggregate.  To be eligible for this benefit,
the Employees must remain employed with EOTT Energy Corp. until
the company identified a termination date and must maintain
satisfactory performance during that period.  The West Coast
Retention Program does not affect the Employee's severance
payment in the event of position elimination.  Payment under the
West Coast Retention Program are accelerated in the event of
accelerated termination date. In the event of voluntary
termination by the Employee, the Employee forfeits retention
payments, payable on termination.

                 U.S. Special Compensation Program

The Debtors participate in a Special Compensation Program,
effective June 1, 2002, which was designed to incentivize
Employees to continue employment with EOTT during period of
uncertainty related to the deposition of EOTT Energy Corp. and
to create organizational stability during the next 12 months to
adequately transition the business to a new owner or to pursue
other strategic alternatives.

EOTT's obligations under this program are due in two Phases:

      Phase I -- Special Retention Arrangements
                 Cost: $1,270,000 (excluding payroll taxes)
                 Covers 30 participants

Special Retention and Non-compete agreements were executed for
Critical Commercial Employees.  Critical Commercial Employees
were defined as those Employees that would have an immediate and
material impact on the value of the company if Employees were to
become employed by a competitor or leave the company.  Employees
covered by Phase I of the Special Retention Program were limited
to commercial personnel.  Employees were required to sign a non-
compete agreement (for varying periods of time based on level of
position and amount of payments or 6-month period in the event
of voluntary termination).

Half of the total retention payments were made in July 1, 2002.
For the Vice President/General Manager positions, the remaining
50% will be paid on May 31, 2003.  For all other positions, the
remaining 50% will be paid on January 15, 2003.  Employees must
remain employed with EOTT until last payment date and must
maintain above satisfactory performance.  This program does not
impact 2002 bonus eligibility and does not affect severance
payment in the event company is sold or position is eliminated.
Payment is accelerated in the event of job elimination prior to
last payment date.

      Phase II -- Special Guaranteed Bonus Arrangements
                  Cost: $1,205,000 (excluding payroll taxes)
                  Covers 58 participants

Special guaranteed minimum bonus agreements were executed for
Key Business Support Employees.  Key Business Support Employees
are defined as those Employees that the loss of whom would have
a detrimental impact on the operations of the Company and the
replacement of whom would result in additional costs to the
Company.  To be eligible for the bonus, the Employee must remain
employed with EOTT and must maintain above satisfactory
performance.  The bonus agreements will be considered in the
2002 bonus distribution with any additional bonus monies beyond
the guaranteed minimum being discretionary.  The program does
not affect severance payment in the event the Company is sold.
Payment will be accelerated in the event of job elimination  
prior to March 31, 2003.  Payment will be made during the 2002
bonus distribution process in 2003 but in no event later than
March 31, 2003.

                 Special Canadian Retention Program

The Debtors participate in a Special Canadian Retention Program,
effective June 1, 2002, which was designed to incentivize the
Canada Employees to continue employment with EOTT during period
of uncertainty related to the deposition of EOTT and to create
organizational stability during the next 7 months to adequately
transition the business to a new owner or to pursue other
strategic alternatives.  The total expense obligation for
reimbursement and expense is $150,000 relating to 8
participants. Special Retention Arrangements have been
implemented for Critical Commercial Employees and Key Business
Support Employees. Critical Commercial Employees are defined as
Employees that would have an immediate and material impact on
the value of the company if Employees were to become employed by
a competitor or leave the company.  Key Business Support
Employees were defined as Employees that the loss of whom would
have a detrimental impact on the operations of the company and
the replacement of whom would result in additional costs to the
company.

The payment schedule is specific to employee position but all
payments will be made by December 31, 2002.  Payments under this
program are staggered over time:

               Amount        When Payable
               ------        ------------
              $670,000     2002 2nd Quarter
               366,000     2002 3rd Quarter
               100,000     2002 4th Quarter
             1,292,500     2003 1st Quarter
               295,000     2003 2nd Quarter
            ----------
            $2,723,500

Payments will be accelerated in the event of job elimination
prior to last payment date.  Employees must remain employed
until the last payment date and must maintain above satisfactory
performance.  The program does not impact 2002 bonus eligibility
and does not affect severance payment in the event company is
sold or position is eliminated. (EOTT Energy Bankruptcy News,
Issue No. 1; Bankruptcy Creditors' Service, Inc., 609/392-0900)

DebtTraders reports that Eott Energy Partners' 11% bonds due
2009 (EOT09USR1) are trading at 57 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=EOT09USR1for  
real-time bond pricing.


EOTT ENERGY: Secures Court's Nod for $575 Million DIP Financing
---------------------------------------------------------------
EOTT Energy Partners, L.P., (OTC Pink Sheets: EOTPQ) has
received interim approval from the Bankruptcy Court to use the
$575 million in Debtor-in-Possession (DIP) financing provided by
its lenders.  The facilities provide up to $325 million for
letters of credit and $250 million of loans.  The company
believes this interim financing approval will enable EOTT to
restore the level of business activity that existed before the
impacts of the Enron bankruptcy.

The order allows immediate issuance of letters of credit so that
the company can continue its ongoing business activities without
interruption.  A final hearing on the DIP facility is scheduled
on October 24, 2002.

"We are pleased with the Court's interim approval of our DIP
financing," said EOTT President Dana Gibbs.  "We have received
very positive responses from our crude oil and feedstock
suppliers, critical vendors and employees in the days since our
filing.  The interim approval of our DIP financing provides
assurance to our customers that we will satisfy all of our
obligations as we complete our restructuring plan.  Moreover,
the approval of the financing enables the company to begin to
grow its business."

On October 9, the Court approved first-day orders authorizing,
among other things, that EOTT's crude oil and feedstock
suppliers, critical vendors, and employee regular pay and
benefits be paid in the ordinary course of business for both
pre-petition claims and post-petition business.  Under EOTT's
restructuring plan filed October 8, EOTT will significantly
reduce its debt, restructure its finances, and formalize a
complete legal separation from Enron.  EOTT anticipates the
restructuring will be completed in early 2003.

For current information on the plan of reorganization, please
see updates at http://www.eott.com  

EOTT Energy Partners, L.P., is a major independent marketer and
transporter of crude oil in North America.  EOTT also processes,
stores, and transports MTBE, natural gas and other natural gas
liquids products.  EOTT transports most of the lease crude oil
it purchases via pipeline that includes 8,000 miles of
intrastate and interstate pipeline and gathering systems and a
fleet of more than 230 owned or leased trucks.  The
partnership's common units are traded under the ticker symbol
"EOTPQ:PK".


EXIDE TECHNOLOGIES: Committee Wants More Time to Challenge Liens
----------------------------------------------------------------
The Official Committee of Unsecured Creditors, in the chapter 11
cases involving Exide Technologies and its debtor-affiliates,
asks the Court to extend the period within which it may
investigate, commence actions and object to, contest, or raise
any defenses to the validity, perfection, priority or
enforceability of the liens, indebtedness or claims of the
Debtors' prepetition lenders or to assert or prosecute any
action for preferences, fraudulent conveyances, other avoidance
power claims or any other claims or causes of action against any
of the Prepetition Lenders, the agent for the Prepetition
Lenders or their representatives.

Under the DIP Financing Order, the Court set November 18, 2002
as the last date by which the Committee was permitted to
commence an action to assert any Claims and Defenses unless the
Prepetition Agent consented to an extension.

David B. Stratton, Esq., at Pepper Hamilton LLP, in Wilmington,
Delaware, tells the Court that the Committee has been
investigating possible Claims and Defenses since the early
stages of these cases.  Although the Committee has been pursuing
any and all possible theories diligently, this investigation has
begun to progress only recently as the Committee has begun to
receive documents responsive to its requests and critical to its
investigation.

However, the recent decision by the United States Court of
Appeals for the Third Circuit in Cybergenics Corp. vs. Chinery,
raises issues as to whether the Committee has the power to
assert avoidance claims on behalf of the Debtors' estates
against the Prepetition Lenders, the Prepetition Agent and their
representatives.  Mr. Stratton reminds the Court that in
Cybergenics, the Third Circuit Court of Appeals ruled that an
official committee of unsecured creditors lacks standing to
assert a Chapter 5 avoidance claim.  This decision raises
significant issues about the Committee's ability to bring an
avoidance action against the Prepetition Lenders, the
Prepetition Agent and their representatives.  The Committee
believes that the Court should indefinitely extend the Objection
Deadline until the issues presented in the Cybergenics decision
are resolved.

The Committee contends that the effect of Cybergenics on its
ability to assert any Claims and Defenses is ample "cause" for
this Court to exercise its discretion by extending the Objection
Period.

This Court has held that it has the inherent power to extend the
deadline to assert actions against prepetition lenders
established in final DIP financing.  In the Chapter 11
proceeding In re Conxus Communications, Case No. 99-1147 (MFW),
Judge Mary Walrath held that the Court has the inherent power to
extend the period within which a creditors' committee may
conduct its investigation of prepetition lenders' liens and the
existence of claims against prepetition lenders.  Chief Judge
Peter Walsh also exercised this power to extend the period
within which a creditors' committee could object to claims and
liens of debtors' prepetition lenders in In re Hechinger
Investment Company of Delaware, Inc., et al., Case No. 99-2261
(PJW) over the objection of the prepetition lenders.  Mr.
Stratton explains that the requested relief simply preserves the
status quo and gives the parties time to consider the
appropriate way to address the issues raised by the Third
Circuit's decision in Cybergenics in the context of the facts
and circumstances of these cases.

Mr. Stratton asserts that the Court should exercise its
discretion and extend the Objection Deadline to relieve the
Committee and the Debtors from the unanticipated consequences of
the Cybergenics decision.  The Prepetition Agent is considering
the Committee's request.  "Should the Prepetition Agent choose
to not consent, the absence of consent to the requested
extension should not cause the Court to stay its hand," Mr.
Stratton says.

To the extent necessary, the Committee asks the Court to relieve
it from the provision of the DIP Financing Order that requires
the Prepetition Agent to consent to the extension of the
Objection Deadline sought in this motion.  "It is beyond
argument that neither the Prepetition Agent or the Committee, or
even this Court, anticipated that a decision like Cybergenics
would call into question the mechanism established under the DIP
Financing Order for the procedures related to investigating and
challenging the validity of the Prepetition Lenders' claims,"
Mr. Stratton says.

Moreover, Mr. Stratton insists that it would be both inequitable
and injurious to the interests of the Debtors and their
creditors if potentially valuable claims were lost because the
Committee may lack standing to assert them, notwithstanding the
fact that the Prepetition Lenders, the Debtors, the Committee
and the Court all agreed that the Committee should have the
right to assert any Claims or Defenses. (Exide Bankruptcy News,
Issue No. 12; Bankruptcy Creditors' Service, Inc., 609/392-0900)

  
FEDERAL-MOGUL: Wants to Pull Plug on Headquarters Lease Contract
----------------------------------------------------------------
Federal-Mogul Corporation and its debtor-affiliates' corporate
headquarters in Southfield, Michigan consists of 360,000 square
feet of indoor office space located on 16 acres of land.  The
Headquarters Facility itself is comprised of four different
buildings housed within two adjoining structures -- Wings -- and
is surrounded by landscaped property and a large parking lot.  
The Wings were constructed at different points in time and the
Debtors used two different third-party lessors as a mechanism to
finance the construction of the Wings. But both Wings are
uniform in architectural design and generally indistinguishable
to the typical visitor.

According to Laura Davis Jones, Esq., at Pachulski, Stang,
Ziehl, Young & Jones, P.C., the Debtors occupy the older portion
of the Headquarters structure pursuant to certain leases with
Northwestern Associates Limited Partnership.  The Northwestern
Wing leases include a series of 1982 agreements that, in turn,
includes a ground lease and an improvements lease.  Under the
Northwestern Ground Lease, the Debtors leased the land
underneath the Northwestern Wing and sold the Northwestern Wing
itself to Northwestern.  In exchange, Northwestern assumed the
Debtors' mortgage obligations for the construction of the
Northwestern Wing.  Northwestern also leased the Northwestern
Wing back to the Debtors under the parties' Improvements Lease.  
Both Leases prevent either the Debtors or Northwestern from
terminating the Northwestern Leases before June 29, 2007.

Meanwhile, the Debtors occupy the newer portion of the Facility,
which comprises three separate adjoining building units, under a
series of 1998 lease agreements with Federal Southfield Limited
Partnership.  Ms. Jones relates that the lease agreements
include a ground lease and an improvements lease.  Under the
Federal Ground Lease, the Debtors chartered the land underneath
the Federal Wing and sold the Wing itself to Federal.  In
exchange, Federal assumed the Debtors' mortgage obligations for
the construction of the Federal Wing.  Pursuant to the Federal
Improvements Lease, Federal leased the Federal Wing back to the
Debtors.  The Federal Leases exist until January 21, 2008.  The
Federal Ground Lease also grants Federal an option to purchase
the land underlying the Federal Wing along with its easements
and appurtenant rights at any point following the termination or
expiration of the Federal Improvements Lease.

Ms. Jones reports that the estimated total cost to the Debtors
for the Headquarters Facility, including rent under the Leases,
operating expenses, and taxes, will be $9,000,000 to $10,000,000
annually for each of the next five years.  In view of that, the
Debtors have undertaken a thorough analysis of alternatives to
remaining in the Headquarters Facility.  Consequently, they
found numerous facilities available in the region that would
provide comparable facilities at a significant savings.  The
Debtors obtained firm offers for three sites ranging in average
annual costs from $4,600,000 to $7,000,000.  By contrast,
according to Ms. Jones, extensive good-faith efforts by the
Debtors to renegotiate the Leases with Northwestern and Federal
have not been productive.

The Debtors further believe that relocating their corporate
headquarters could result in greater efficiency and further cost
savings that cannot be quantified at this time.

Ultimately, the Debtors have decided to reject the Leases and
pursue securing a different facility to serve as their new
corporate headquarters.  The Debtors seek to reject the Leases
on a prospective basis in order to provide all of the Debtors'
existing and potential lessors greater certainty regarding their
ability to reject the Leases.  Hence, the Debtors suggest that
the rejection of the Leases be made effective on the date that
they vacate and surrender the Headquarters Facility.

Ms. Jones tells the Court that the Debtors are presently
negotiating a lease for their new headquarters.  They anticipate
being able to vacate the current Headquarters within 18 months.
In the meantime, the Debtors propose to provide quarterly
progress updates to Northwestern and Federal regarding their
timetable to vacate the Facility.  The Debtors also propose to
continue performing all of their obligations under the Leases
during all times in which they remain in possession of the
Facility.

                     Effects of Rejection

In conjunction with the termination of their corporate
headquarters leases, the Debtors want to make clear their
position about the effect of the rejection.  They also want to
promote discussions with Northwestern and Federal about the
future of the Headquarters Facility following the lease
rejection.

Ms. Jones explains that, although the Debtors intend to relocate
their corporate headquarters, if Northwestern and Federal
offered sufficient incentives to stay before the Debtors enter
into an agreement for a new facility, the Debtors might remain
in the Headquarters Facility.

"Recognizing that the [rejection] depicts an unpleasant scenario
for Northwestern and Federal, the Debtors are prepared to enter
into discussions with Northwestern and Federal to the extent
that doing so might resolve outstanding issues concerning the
Headquarters Facility following the rejection of the Leases,"
Ms. Jones tells the Court.  In addition, Ms. Jones notes that,
if both lessors are prepared to make fair offers to purchase the
Debtors' remaining interests in the Headquarters Facility or the
surrounding land, the Debtors are prepared to negotiate.

The Debtors allege that it might be difficult for Federal and
Northwestern to make profitable use of the Headquarters Facility
without substantial cooperation with one another as well as with
them.

A. Effects Ground Lease Rejection

As lessees under the Ground Leases, Northwestern and Federal
either could elect to:

-- treat their Ground Leases as terminated and abandon any
   interest in the Headquarters Facility; or

-- remain in possession of their portions of the Headquarters
   Facility and offset their damages against the rent they must
   pay the Debtors.

If Northwestern and Federal choose to remain in possession of
the Headquarters Facility, their rights to recover any rejection
damages as a result of the Debtors' termination of the Ground
Leases are limited to a right of offset against the amount of
rent that Northwestern and Federal would owe the Debtors under
the Ground Leases -- a total of $130,000 per year between the
two Ground Leases.

Ms. Jones explains that both Northwestern and Federal have
rights to only a portion of the Headquarters Facility.  Although
the Headquarters Facility does consist of the two separate
Wings, the Wings are sufficiently adjacent and adjoining to
prevent easy division into two separate structures.  Therefore,
as a practical matter, if Northwestern and Federal intend to
lease their respective portions of the Headquarters Facility
after the Debtors vacate it, Northwestern and Federal probably
either must locate a single tenant to occupy both Wings and work
together to act as a single lessor or significantly remodel the
Headquarters Facility.

To complicate matters, Federal, which owns the improvements
constituting the Federal Wing, has an option to purchase the
ground where Federal Wing sits as well as the associated
easement and appurtenant rights once the Debtors cease to be
tenants under the Federal Improvements Lease.  Unfortunately,
Northwestern does not possess any right to purchase the land
where the Northwestern Wing sits.  Therefore, absent further
negotiation and cooperation from the Debtors, it would appear
unlikely that Northwestern and Federal could obtain clear and
marketable title to the Headquarters Facility beyond the term of
the Leases.

Additionally, Ms. Jones indicates that the possible claims of
Federal with respect to the termination of the Improvements
Lease -- and the eventual non-performance of the purchase option
-- would be subject to offset against Federal's rental
obligations.

B. Effect of Rejection of Improvements Leases

Northwestern and Federal's lease rejection damages claims would
be subject to the cap imposed by Section 502(b)(6) of the
Bankruptcy Code.  As lessors of the terminated Improvement
Leases, both would be entitled to the amount of rent the Debtors
owe for one year or 15% of three years.  Given that, the total
claims of Northwestern and Federal for lease rejection damages
will be $6,000,000, a total amount of rent due for one year
under the Improvements Leases. (Federal-Mogul Bankruptcy News,
Issue No. 25; Bankruptcy Creditors' Service, Inc., 609/392-0900)


FOAMEX INT'L: Talking with Bank Lenders to Amend Fin'l Covenants
----------------------------------------------------------------
Foamex International Inc. (NASDAQ: FMXI), the world's leading
manufacturer of flexible polyurethane and advanced polymer foam
products, expects to report a net loss for the third quarter
ended September 29, 2002, primarily as a result of previously
disclosed price increases of an unprecedented magnitude from its
raw material suppliers, combined with higher than expected SG&A
expenses principally related to one-time fees.

The Company expects to report EBITDA in the range of $7-$9
million for the same period, excluding any restructuring charges
or credits.

In light of these results, the Company has obtained a waiver
from its bank lenders of its financial covenants for the period
ended September 29, 2002. This waiver will be effective until
November 30, 2002. The Company is currently in discussions with
its bank lenders to amend its financial covenants. Foamex
expects to receive the necessary covenant amendments by November
30, 2002, although there can be no assurance that the covenants
will be amended.

Tom Chorman, Chief Financial and Administrative Officer, stated:
"The substantial price increases imposed by our chemical
suppliers have significantly impacted our earnings. In addition,
we incurred higher than expected SG&A expenses, primarily due to
one-time fees related to the formation of Symphonex and the now
terminated negotiations concerning the sale of our GFI carpet
cushion business."

Mr. Chorman continued: "We are working with our customers to
address pricing issues, as well as taking steps to expand our
supply base in an effort to mitigate raw material pricing
pressures. At the same time, we are taking action to increase
efficiency and reduce costs."

Foamex, headquartered in Linwood, PA, is the world's leading
producer of comfort cushioning for bedding, furniture, carpet
cushion and automotive markets. The Company also manufactures
high-performance polymers for diverse applications in the
industrial, aerospace, defense, electronics and computer
industries as well as filtration and acoustical applications for
the home. For more information visit the Foamex Web site at
http://www.foamex.com  

At June 30, 2002, Foamex's balance sheet shows a total
shareholders' equity deficit of about $81 million.


FRONTLINE CAPITAL: Seeks to Extend Exclusivity Until February 7
---------------------------------------------------------------
FrontLine Capital Group asks the U.S. Bankruptcy Court for the
Southern District of New York for an extension of its exclusive
periods.  The Debtor seeks to maintain its exclusive right to
file a chapter 11 plan until February 7, 2003 and extend its
exclusive period in which to solicit acceptances of that plan
until April 11, 2003.

The Debtor tells the Court additional time is needed to complete
its assessment of claims and to continue its discussions with
its creditors.  Currently, the Debtor is in the process of
reviewing and assessing the claims that have been filed.  This
process will have a significant impact on the Debtor's ability
to develop and file a plan of reorganization. The Debtor has
also been diligently working with its two largest unsecured
creditors, BT Holdings (NY), Inc., and Reckson Operating
Partnership, LP, which together hold in excess of 90% in amount
of the unsecured claims in this case, to develop and file a
consensual plan of reorganization.

During the course of this case the Debtor has continued to make
steady progress in connection with its reorganization efforts,
the Debtor tells the Court. The progress includes establishing a
bar date so the Debtor could know the total universe of claims
and interests for purposes of plan formulation.

The Debtor will use this time to formulate and promulgate its
plan of reorganization. The Debtor believes that this will best
ensure that the values of its assets are preserved and maximum
distributions are available for creditors in this case.

FrontLine Capital Group, a holding company that manages its
interests in a group of companies that provide a range of office
related services, filed for chapter 11 protection on June 12,
2002. John Edward Westerman, Esq., at Westerman Ball Ederer &
Miller, LLP represents the Debtor in its restructuring efforts.
As of March 31, 2002, the Company listed $264,374,000 in assets
and $781,374,000 in debts.


GILAT SATELLITE: Commences Debt Restructuring Talks with Lenders
----------------------------------------------------------------
Gilat Satellite Networks Ltd. (NASDAQ: GILTF), a worldwide
leader in satellite networking technology, announced that it,
its largest banking creditor, and bondholders holding a majority
of the US$350 million (face value), 4.25 percent Convertible
Subordinated Notes due 2005, have agreed to commence
negotiations to restructure the Company's debt to the Bank and
the Bondholders.

These negotiations will be based on certain agreed guidelines
that will include concessions from its creditors and lenders.
The guidelines anticipate a partial conversion of a major
portion of the face value of the Bonds into common equity and
options, and a partial exchange of the remaining face amount
into new long-term convertible bonds with a grace period for
interest payments. The guidelines also anticipate that a certain
portion of the principal of the Company's debt to the Bank will
be deferred by a few years and that the remaining debt will be
converted into equity and new convertible bonds. The Company
intends to negotiate better payment terms with its other major
lenders and to obtain concessions from its major suppliers. The
Company, the banks and bondholders holding a majority of the
bonds have agreed to cooperate in crafting a detailed
restructuring plan by setting up a fast track timetable (30
days) and to submit the proposed plan to the Bondholders and
banks for their approval as soon as feasibly possible.

"We expect that the Company's debt level will be significantly
reduced by approximately US$300 million by converting a
substantial amount of debt to equity or options to acquire
equity in the Company," said Yoel Gat, Chairman and CEO of Gilat
Satellite Networks. "Post restructuring financing costs are
expected to be relatively minimal (less than US$5 million cash
per year) for the first few years," he added.

Based upon the progress reached with major lenders and
bondholders holding majority of the bonds, and in order to
accelerate the completion of the process, the Company Wednesday
filed an application with the Israeli District Court in Tel Aviv
to commence the approval for the restructuring plan and a stay
of action by the bondholders. The stay will be effective in
Israel and the Company will seek a similar stay in the US. The
stay in Israel will be in effect for a period of 30 days subject
to the Company's compliance with certain matters requested by
the Court. The stay is intended to allow the proper completion
of a detailed restructuring plan and its further submission to
bondholders and banks. The approved stay will enjoin the
Company's bondholders from exercising any rights that could
hamper the plan.

The Company's petition filed with the Court is supported by it
largest banking creditor, the Company's other Israeli banks and
bondholders holding a majority of the bonds.

The Company, its banks and bondholders holding majority of the
bonds are working consistently and steadfastly to complete the
restructuring plan. While this process is taking shape, the
Company's ongoing operations do continue as usual and are
unaffected by the restructuring process.

"This final phase of the restructuring process is nearing
completion and we are encouraged by the progress made thus far,"
said Yoel Gat, Chairman and CEO of Gilat. "After the
restructuring process is complete, Gilat will have significantly
less debt and improved liquidity, ensuring long-term viability
and positioning the Company for growth," he added.

Gilat Satellite Networks Ltd., with its global subsidiaries
Spacenet Inc., and Gilat Latin America, is a leading provider of
telecommunications solutions based on Very Small Aperture
Terminal (VSAT) satellite network technology - with nearly
400,000 VSATs shipped worldwide. Gilat markets the Skystar
Advantage, DialAw@y IP, FaraWay, Skystar 360E and SkyBlaster(a)
360 VSAT products in more than 70 countries around the world.
The Company provides satellite-based, end-to-end enterprise
networking and rural telephony solutions to customers across six
continents, and markets interactive broadband data services. The
Company is a joint venture partner in SATLYNX, a provider of
two-way satellite broadband services in Europe, with SES GLOBAL
and, following the execution of a definitive agreement and
regulatory approval, Alcatel Space and SkyBridge, subsidiaries
of Alcatel. Skystar Advantage(R), Skystar 360(TM), DialAw@y
IP(TM) and FaraWay(TM) are trademarks or registered trademarks
of Gilat Satellite Networks Ltd. or its subsidiaries. Visit
Gilat at http://www.gilat.com ((a)SkyBlaster is marketed in the  
United States by StarBand Communications Inc., under its own
brand name.)


GLOBAL CROSSING: Court Approves Lucent Settlement Agreement
-----------------------------------------------------------
Global Crossing Ltd., and its debtor-affiliates obtained
permission from the U.S. Bankruptcy Court for the Southern
District of New York to enter into Settlement Agreement with
Lucent Technologies.

As previously reported, Lucent asserted claims against the
Debtors for $123,000,000, including administrative expense
claims under Section 503 of the Bankruptcy Code with respect to
certain Debtors and claims having priority or preference under
applicable law against certain non-debtor entities.  However,
the Debtors dispute the amount, extent and priority of Lucent's
claims and assert that they may have a claim against Lucent for
$25,000,000 under Section 547 of the Bankruptcy Code.

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

-- Global Crossing Parties:  Global Crossing Ltd. and all of its
   debtor and non-debtor subsidiaries and affiliates, excluding
   Asia Global Crossing Ltd. and its direct subsidiaries;

-- Lucent Parties:  Lucent Technologies Inc. and all of its
   subsidiaries and affiliates;

-- Initial Payment by Global Crossing to Lucent:  Global
   Crossing to pay $15,000,000 to Lucent within 10 business days
   of Court approval of the Lucent Settlement Agreement;

-- Global Crossing Release:  Within 10 business days of Court
   approval of the Lucent Settlement Agreement, Global Crossing
   releases Lucent from all claims (from the beginning of time
   through and including the date of the Lucent Settlement
   Agreement) other than claims arising under any warranties
   contained in the Lucent Agreements, as modified;

-- Lucent Release:  As of the Effective Date, Lucent releases
   Global Crossing from all claims (from the beginning of time
   through and including the date of the Lucent Settlement
   Agreement) with these claims totaling $123,000,000;

-- Conveyance of Title to Systems, Segments and Equipment:
   Lucent will transfer to Global Crossing all title to the
   cable segments, systems, systems upgrades and equipment free
   and clear of liens, claims and encumbrances that arise by or
   through Lucent.  The title will vest in Global Crossing on
   the Effective Date.  The order approving the Lucent
   Settlement Agreement will confirm transfer of title free and
   clear of liens, claims and encumbrances that arise by or
   through Lucent to Global Crossing;

-- Transfer/Return Ethernet Cards:  Upon receipt of the Initial
   Payment, Lucent will convey 300 ethernet cards to Global
   Crossing, with conveyance to be on an "AS IS, WHERE IS"
   basis. In exchange, the Debtors will give Lucent a release of
   all claims and liabilities associated with the Cards.  The
   Debtors will return to Lucent 50 unused, boxed Cards to
   Lucent within 30 days of the Court's approval of the Lucent
   Settlement Agreement;

-- Subsequent Cash Payment by Global Crossing to Lucent:  Global
   Crossing to pay $10,000,000 to Lucent upon the earlier of:

    a. confirmation of Global Crossing's plan of reorganization,
       or

    b. March 31, 2003.

-- Payment for Services:  Global Crossing to pay $25,000,000 to
   Lucent for, among other things, work, material, product,
   services, purchase orders and other matters provided or
   ordered by December 31, 2002, less any amounts previously
   paid by Global Crossing to Lucent as described in Schedule
   2.1(b) of the Lucent Settlement Agreement, i.e., about
   $14,500,000. Global Crossing is required to make the Services
   Payment on or before December 31, 2002;

-- Allowed Unsecured Claim:  Lucent will jointly have a single
   allowed general unsecured claim of $20,000,000 against the
   Debtors on a joint and several basis;

-- Amendment to June 2001 Services Agreement:  The June 2001
   Services Agreement will be amended and clarified to provide
   for:

   a. Lucent commits to purchase services from Global Crossing
      in the amount of the $30,000,000 over the next 6 years;
      and

   b. Global Crossing will retain the balance of the $15,000,000
      prepayment made by Lucent during the period of July 2001
      to July 2002 and the prepayment will not reduce the
      Services Commitment;

-- Responsibilities and Remedies Remaining under Existing
   Contracts:  The Lucent Agreements are modified so that the
   term of all warranties for products and services provided by
   Lucent to Global Crossing will conclude on the earlier to
   occur of:

   a. the end of the remaining warranty period for the product
      and service as provided in the applicable contracts; or

   b. September 30, 2004.

   All "design life warranties" will be governed by the original
   terms and conditions of the Lucent Agreements;

-- Payment Terms under Existing Contracts:  Within 30 days of
   the effective date of a confirmed plan of reorganization,
   Lucent and Global Crossing will meet and discuss payment
   terms in good faith.  Until then, for products and equipment,
   Global Crossing will pay upon shipment the purchase price of
   all products and equipment, including any costs or charges
   set forth under the appropriate agreement.  For services and
   maintenance, Global Crossing will prepay in full on the last
   business day of the preceding month.  Within 5 business days
   after invoice, Global Crossing will pay any additional and
   undisputed amounts incurred for additional services and
   maintenance.  For project development, construction and
   installation contracts, Global Crossing will prepay semi-
   monthly on the first business day on or after the first and
   fifteenth day of the month;

-- Assumption of Executory Contracts:  The Debtors will assume
   the Lucent Agreements, provided that no cure or other
   payments will be required or made in connection with the
   assumption; and

-- Right of Global Crossing to Assume and Assign Lucent
   Agreements:  Global Crossing will be permitted to assign any
   or all Lucent Agreements and Lucent waives any right under
   Section 365 of the Bankruptcy Code; provided, however, that
   Global Crossing will not be permitted to assign any or all of
   the Lucent Agreements to any competitor of Lucent or any
   reseller of Lucent equipment and that Global Crossing will
   not be permitted to assign any license or right granted with
   respect to any Lucent intellectual property in a Lucent
   Agreement separate from the assignment of the entire
   agreement itself. (Global Crossing Bankruptcy News, Issue No.
   24; Bankruptcy Creditors' Service, Inc., 609/392-0900)


GS MORTGAGE: Fitch Junks Rating on Class J 1998-C1 Certificates
---------------------------------------------------------------
Fitch Ratings downgrades GS Mortgage Securities Corp. II's
commercial mortgage pass-through certificates, series 1998-C1,
$23.3 million class J to 'CCC' from 'B-'. As a result of this
action, the class is removed from Rating Watch Negative. In
addition, Fitch affirms $115.4 million class A-1, $436.0 million
class A-2, $624.5 million class A-3, and interest-only class X
at 'AAA', the $102.4 million class B at 'AA', $102.4 million
class C at 'A', $107.0 million class D at 'BBB', $32.6 million
class E at 'BBB-', $23.3 million class G at 'BB', and $55.8
million class H at 'B'. Fitch does not rate classes F and K. The
rating downgrade and affirmations follow Fitch's annual review
of the transaction, which closed in October of 1998.

The class J was placed on Rating Watch Negative on February 12,
2002, due to the exposure to Kmart Corp, in addition to the
other loans of concern. There are 11 loans collateralized by 11
properties with exposure to Kmart comprising 3% of the pool. Of
these, Kmart has rejected five leases. At this time two (0.3%)
are expected to cause losses.

To date approximately $8.3 million in losses have been realized
in 2002, which is attributed to the disposition of five hotel
loans.

The downgrade of class J is primarily attributed to the losses
expected on two real estate owned assets and 11 other delinquent
loans, which include the two Kmart loans. The class J is not
expected to realize a principal loss from these 13 assets,
however, the credit enhancement after the losses are realized
will not be sufficient to maintain the rating. Four of the 13
loans, Holiday Inn - Lewisville, Holiday Inn Express - Franklin,
Comfort Inn - Franklin, and Days Inn - Franklin, have been sold
and the $3.5 million loss associated with the loans will be
realized as of the October distribution. Fitch estimated total
losses on the additional 9 loans to be approximately $13.3
million.

As of the September 2002 distribution date, the aggregate
collateral balance has been reduced by 9.2% to $1.69 billion
from $1.86 billion at issuance. GMAC Commercial Mortgage Corp.,
the master servicer, collected year-end 2001 financial
statements for 76% of the pool balance. According to this
information, the 2001 weighted average debt service coverage
ratio is 1.73 times, compared to an issuance DSCR of 1.55x for
the same loans. The pool also consists of six credit tenant
lease loans (0.5%) that are not included in the DSCR
calculations.

The pool continues to benefit from property type and geographic
diversification. The pool consists primarily of retail (25%),
office (17%), multifamily (16%), hotel (16%), and industrial
(13%) with geographic concentrations in New York (9%),
California (9%), Virginia (7%), and Texas (6%).

The Americold loan (8.1%), of which 50% participation interest
is in this transaction, is secured by 28 cold-storage warehouses
totaling 6.2 million square feet and 1.4% of the loan is
defeased. The DSCR for the trailing twelve months ending June
2002 (TTM 6/02) is 1.75x compared to 1.71x for YE 2001. Given
the performance of this loan it maintains an investment-grade
credit assessment.

The Four Winds Portfolio (1.8%) is comprised of two cross-
collateralized and cross-defaulted loans on two psychiatric
facilities totaling 263 beds: one is in Katonah, NY (175 beds)
and the other is in Saratoga Springs, NY (88 beds). The TTM 6/02
DSCR for the portfolio fell to 1.41x from 2.87x at closing, but
has increased from 1.23x at TTM 6/01. As of June 2002, the
occupancy for both facilities was approximately 98%. Given the
performance of this loan it maintains the below investment-grade
credit assessment assigned at last review.

The downgrade reflects the losses to be realized as of the
October distribution date and future expected losses. Fitch will
continue to monitor this transaction, as surveillance is
ongoing.


HIGH SPEED ACCESS: Sets Annual Shareholders' Meeting for Nov. 27
----------------------------------------------------------------
High Speed Access Corp., (OTC Bulletin Board: HSAC) will hold
its annual shareholder meeting November 27, 2002, at 10:00 a.m.,
Eastern time, at the offices of Frost Brown Todd LLC, 400 West
Market Street, 32nd Floor, Louisville, Kentucky.  The company's
board of directors has fixed the close of business on October
21, 2002, as the record date for the determination of
shareholders entitled to notice of and to vote at the annual
meeting.

As reported in Troubled Company Reporter's August 16, 2002
edition, High Speed Access Corp.'s board of directors
unanimously approved a plan of liquidation and dissolution and
adopted a resolution recommending the plan of liquidation and
dissolution be submitted to its stockholders for approval.  
Under Delaware law, holders of a majority of HSA's common stock
must approve a plan of liquidation and dissolution.


HURRY INC: Special Shareholders' Meeting Slated for November 25
---------------------------------------------------------------
Hurry, Inc., (OTC BB:HURY.PK) announced that its Board of
Directors has called a Special Meeting of shareholders to be
held Monday, November 25, 2002.

The Company also stated that shareholders of record on October
18, 2002 will receive the proxy materials concerning the Special
Meeting and will be entitled to vote at the Special Meeting.

At the Special Meeting, shareholders will be asked to consider
and vote upon a Plan of Liquidation and Dissolution pursuant to
which the Company would be liquidated and dissolved. If the Plan
of Liquidation and Dissolution is approved, the Company intends
to begin the liquidation and dissolution process immediately
after the Special Meeting, as will be more particularly
described in the proxy materials.

Hurry, Inc., which was formerly known as Harry's Farmers Market,
Inc., is in the process of winding up its operations. The
Company previously owned as many as three megastores and six
convenience stores specializing in perishable food products,
poultry, seafood, fresh bakery goods, and freshly made ready-to-
eat, ready-to-heat and ready-to-cook prepared foods as well as
deli, cheese and dairy products.


ICO INC: Extends Amended Senior Notes Tender Offer to October 30
----------------------------------------------------------------
ICO, Inc., (Nasdaq: ICOC) announced the modification and
extension of its tender offer to acquire its outstanding 10-3/8%
Series B Senior Notes due 2007 that commenced on September 19,
2002.  ICO will now offer to repurchase all of the outstanding
Senior Notes at a price of 97.25% of face value plus accrued
interest to the date of purchase.  "This deal is good for
bondholders and good for shareholders," said Jon Biro, ICO's
Chief Financial Officer.  "At this price, we expect our offer to
be overwhelmingly accepted.

"ICO management has received informal indications from a group
purporting to represent holders of approximately 70% of the
outstanding Senior Notes that they intend to accept the modified
tender offer," Biro added.  ICO expects to fund the bond
repurchase from working capital including the proceeds it
received on September 6, 2002 from the sale of its oilfield
services business segment.  "Following this transaction, our
balance sheet will be substantially deleveraged, providing us
with the opportunity to continue the process of restructuring
and expanding our polymers business," Biro said.

Each tendering noteholder will be deemed to have consented to
amendments to certain indenture covenants and default provisions
applicable to the Senior Notes.  These amendments will delete
most of the covenants in the indenture for the Senior Notes and
several events of default.  Tendering noteholders will also be
deemed to have waived the covenant that ICO offer to repurchase
its Senior Notes using the proceeds of the sale of its oilfield
services business segment.  ICO will execute a supplement to the
indenture effecting the amendments and the waiver immediately
prior to closing the tender offer if it has received consents
representing at least a majority of the outstanding principal
amount of the Senior Notes.

The modified tender offer will expire at 12:00 midnight, New
York City time, on Wednesday, October 30, 2002, unless further
extended.  Tendered notes may be withdrawn at any time prior to
the expiration time.

The full terms and conditions of the modified tender offer and
the related consent solicitation are contained in ICO's Amended
Offer to Purchase and Consent Solicitation Statement, dated
October 16, 2002.

ICO's obligation to complete the modified tender offer is
subject to customary conditions, although ICO may waive any of
these conditions.  Subject to applicable law, ICO may also
further extend or terminate or otherwise amend the offer.

This announcement is not an offer to purchase, a solicitation of
an offer to purchase, or a solicitation of an offer to sell
securities with respect to the Senior Notes.  The modified
tender offer may only be made pursuant to the terms of the
Amended Offer to Purchase and Consent Solicitation Statement and
the accompanying consent and letter of transmittal.

Jefferies & Company, Inc., is acting as dealer manager and
solicitation agent and Mellon Investor Services LLC, New York,
New York, is acting as the depositary and information agent in
connection with the modified tender offer. Copies of the Amended
Offer to Purchase and Consent Solicitation Statement, including
the consent and letter of transmittal, may be obtained by
calling Harvey Eng from Mellon Investor Services LLC at (917)
320-6286.  Additional information concerning the terms of the
modified tender offer, including all questions relating to the
mechanics of the offer, may be obtained by contacting either Mr.
Eng of Mellon (the depositary and information agent) or Joseph
F. Maly of Jefferies & Company, Inc. (the dealer manager and
solicitation agent) at (415) 229-1487.

Through its ICO Polymers, Inc., subsidiary, ICO, Inc., engineers
and produces specialty polymer powders for the rotational
molding industry, produces specialty concentrates for the film
industry, and provides other polymer processing services.  ICO
Polymers operates from 21 plants in ten countries worldwide.


INFORMATION RESOURCES: Working Capital Deficit Tops $27 Million
---------------------------------------------------------------
Information Resources, Inc., (Nasdaq: IRIC) reported its third
quarter results.

                    Third Quarter 2002 Results

For the quarter ended September 30, 2002, IRI reported net
income of $0.9 million. This compares to a net loss of $0.5
million, including restructuring and other charges, for the
third quarter of 2001. Excluding these charges, IRI reported net
income of $2.1 million for the third quarter of 2001.

Consolidated revenue of $140.6 million was 2% better than prior
year. U.S. revenue was $104.2 million, or 1% lower than last
year, while international revenue increased 10% to $36.4
million. The international increase was due to the favorable
impact of currency over the prior year.

At September 30, 2002, Information Resources' balance sheets
show that its total current liabilities eclipsed its total
current assets by about $27 million.

"Our earnings for the quarter fell below expectations, primarily
due to the lack of topline growth," said Chairman and CEO Joe
Durrett. "IRI made excellent progress in a number of areas,
including a record quarter from the U.S. analytics business
which reported 18% growth. However, overall results are
overshadowed by the poor performance of our German operations
and the continued industry pressures facing our business,
including CPG industry consolidation, pricing competition, and
the adjustment to the absence of Wal- Mart POS data.  We are
working through these issues but there are no easy solutions.  
Nonetheless, we have a large and diverse client base, an
encouraging product pipeline and a healthy balance sheet to help
us address these challenges.  IRI had excellent cash flow in the
third quarter, generating almost $12 million on strong
collections and positive operating income," said Durrett.

                   YTD Third Quarter 2002 Results

For the nine months ended September 30, 2002, the Company
reported net income, before restructuring and other charges and
the cumulative effect of an accounting change for goodwill, of
$3.3 million.  This compares to net income, before restructuring
and other charges, of $3.6 million for the nine months ended
September 30, 2001. In accordance with the new accounting rules
for goodwill, the Company performed an impairment test in the
second quarter to determine the fair value of the goodwill
recorded on its books.  Based on this test, the Company wrote
off all of its goodwill in order to comply with the new
accounting rules.  The result was a $7 million charge recorded
in accordance with Generally Accepted Accounting Principles
(GAAP) as the cumulative effect of an accounting change in the
financial statements.  GAAP required this charge to be taken in
the first quarter of 2002.  Including the impact of the goodwill
charge, as well as restructuring and other costs, the Company
reported a net loss of $8.2 million for the nine months versus a
net loss of $4.2 million for the prior year.

Consolidated revenue of $413.5 million for the nine months ended
September 30, 2002 was $1.9 million lower than the prior year.  
U.S. revenue of $309.0 million was 2% lower than last year while
international revenue of $104.5 million was up 4% over last
year.  Excluding the impact of currency, international revenue
increased 1% over the prior year.

Information Resources, Inc., is a leading provider of UPC,
scanner-based business solutions to the consumer packaged goods
industry, offering services in the U.S., Europe and other
international markets.  The Company supplies CPG manufacturers,
retailers and brokers with information and analysis critical to
their sales, marketing and supply chain operations.  IRI
provides services designed to deliver value through an enhanced
understanding of the consumer to a majority of the Fortune 500
companies in the CPG industry.


INTEGRATED HEALTH: Selling IHS-126 Assets to Baltic for $2.6MM
--------------------------------------------------------------
IHS Acquisition No. 126, Inc., and the other Integrated Health
Services, Inc. Debtors seek the Court's authority to:

A. sell real property, improvements and personalty owned by IHS-
   126 comprising a 100-bed skilled nursing facility, located at
   130 Buena Vista Street in Baltic, Ohio and known as IHS
   Horizon Baltic, to Baltic Realty LLC, as Buyer, free and
   clear of all liens, claims, interests and encumbrances,
   except for certain Permitted Encumbrances as set forth in the
   Contract of Sale by and between IHS-126 and the Buyer dated
   as of October 4, 2002; and

B. transfer the operations of the Facility to Baltic Health Care
   Corporation, as Transferee and New Operator of the Facility,
   pursuant to the Operations Transfer Agreement by and between
   IHS-126 and the New Operator, dated as of October 4, 2002.

According to Robert S. Brady, Esq., at Young Conaway Stargatt &
Taylor, LLP, in Wilmington, Delaware, IHS-126 is a successor-in-
interest to Horizon Healthcare Corporation, the Facility's prior
owner.  IHS-126 is also a successor-borrower of a $3,000,000
mortgage loan.  The loan documents were originally by and
between Horizon and LTC Properties, Inc.  LTC Properties was
eventually succeeded by LTC REMIC Corporation.

Mr. Brady informs the Court that the current Loan Balance is
$2,556,040.  Pursuant to the Loan Documents, IHS-126 is liable
for repayment of the outstanding Loan balance.  In addition,
IHS-126's debt service obligations under the Loan Documents were
guaranteed by Integrated Health Services, Inc.  The Debtors are
convinced that they must divest themselves of the Facility and
its operations.

The operations of the Facility constitute a cash drain on the
Debtors' resources and estates, both presently and on a
projected basis.  The Debtors present these operating results as
evidence:

-- For the year ended December 31, 2001, the Facility generated
   EBITDA in the amount of $302,893.  Taking into account the
   mortgage interest, the Facility was only nominally cash flow
   positive;

-- For the first 7 months of year 2002, the actual year-to-date
   EBITDA was $68,690.  Taking into account over $20,000 in
   monthly mortgage interest expense, the Facility's cash flow
   was negative $70,000 through July, 2002; and

-- For the calendar year 2002, it is projected that the Facility
   will experience an even greater negative cash flow.

In addition, the Loan will mature on December 1, 2002.  The
Debtors do not believe it appropriate to devote the estates'
resources to the payment of the Loan, given the Facility's value
and poor financial performance.

Early this year, Mr. Brady relates that the Debtors started to
market the Facility.  Only two potential purchasers for the
Facility emerged.  After discussions, one potential purchaser
did not show further interest.  The other one presented the
Debtors with an offer to purchase the facility for $2,000,000.  
However, negotiations with this prospective purchaser did not
result in a mutually agreeable contract of sale for the
Facility.  The Debtors believe that, due to its lackluster
EBITDA, the Facility is relatively unmarketable.

An appraisal of the Facility on July 18, 2002 pegged its value
at $1,550,000.  Thus, any closure of the Facility would result
in a mortgage deficiency claim, albeit unsecured, for about
$1,000,000 against IHS-126's estate.

With the goal of unburdening these Chapter 11 estates, Mr. Brady
relates that the Debtors approached the Lender and proposed that
the Lender seek a new operator for the Facility to which the
Debtors would transfer the Facility's operations.  The Lender
located a New Operator, Baltic Health Care Corporation.  During
the negotiation of the Transfer Agreement, Baltic expressed a
serious interest in purchasing the Facility by and through a
related entity, Baltic Realty, LLC.

After substantial arm's-length and good faith negotiations
between the Debtors, the Lender, the Buyer, and the New
Operator, the parties agreed to the terms of two separate but
intertwined agreements -- the Sale Contract with the Buyer and
the Transfer Agreement with the related New Operator.

Pursuant to the Sale Contract, Mr. Brady explains that IHS-126
will sell substantially all its assets -- real property,
improvements, personal property -- to the Buyer, free and clear
of all liens, claims, interests and encumbrances, except for the
Permitted Encumbrances specified in the Sale Contract, for
$2,600,000.

The Sale proceeds will be sufficient to satisfy only the
Lender's secured interest.  Therefore, only the Lender's secured
interest in the Facility will attach to the Sale proceeds.  The
Debtors are not aware of any other Liens.

Mr. Brady notes that the Transfer Agreement provides a
structural framework for accomplishing the orderly transition of
the Facility's operations to the New Operator.  Specifically,
the Transfer Agreement provides for IHS-126 to transfer to the
New Operator, all of the Facility's inventory, resident lists
and records, furnishings, fixtures, equipment and supplies
located at the Facility, and the Facility's Resident Trust
Funds, without recourse, representation or warranty, except as
specifically set forth in the Transfer Agreement, to the extent
transferable under applicable law.  In addition, the Transfer
Agreement:

a. sets forth the procedures applicable to the New Operator's
   hiring of the Facility's employees,

b. governs the disposition of unpaid accounts receivable, pro-
   rations of utility charges, real and personal property taxes
   and any other items of revenue or expense attributable to the
   Facility, and

c. affords the New Operator the opportunity to elect to take
   assignment of the Operating Contracts.

The New Operator is not assuming the Debtors' Medicare or
Medicaid reimbursement provider agreement.  The Debtors will
take appropriate steps to dispose these reimbursement provider
agreements.

In accordance with the terms and conditions of the Transfer
Agreement, the New Operator must, within 10 days following the
Execution Date, identify those Operating Contracts for which it
seeks to take assignment.  The Debtors will provide reasonable
assistance to the New Operator in effecting the assumption and
assignment of the Operating Contracts that the New Operator
seeks to obtain.

The Debtors believe that an auction of the Facility is not
required.  Mr. Brady reminds Judge Walrath that a debtor has
broad discretion in determining the manner in which its assets
are sold. Rule 6004 of the Federal Rules of Bankruptcy Procedure
sets forth the procedural parameters for asset sales outside of
the ordinary course of business, and provides that sales may be
by either public or private sales.  Accordingly, a debtor may
sell assets of the estate outside of the ordinary course of
business without conducting a public auction, or, as the case
may be, soliciting a bid higher or better than that contained in
a privately negotiated purchase agreement.

However, a debtor is obligated to maximize the return to its
estate resulting from an asset sale, whether public or private.
In the context of bankruptcy sales, courts have held that a
purchase price equivalent to 75% of the value of the assets
constitutes fair and valuable consideration.  In this case, Mr.
Brady points out that the aggregate purchase price covers the
total remaining Loan debt.  Moreover, the $2,600,000 purchase
price relieves the Debtors of all liabilities under the Loan
Documents relating to the Facility and provides a recovery well
in excess of the appraised value of the Facility.  Accordingly,
the Sale price is fair and reasonable.

The soundness of the Debtors' decision to sell the Facility to
the Buyer and to transfer the Facility's operations to the New
Operator is manifest in the benefit realized by the Debtors'
estates.  Mr. Brady points out that the complete divestiture of
the Facility will unburden the Debtors' estates from the
Facility's negative cash flow, eliminate any administrative and
ongoing expenses and liabilities associated with operating the
Facility, and effect the release of the Debtors from all
obligations under or in connection with the Loan and the Loan
Documents.

The Debtors also ask the Court to grant the Buyer the
protections of a good faith purchaser.  Section 363(m) of the
Bankruptcy Code protects good faith purchasers of estate
property sold pursuant to Section 363(b) from reversal, on
appeal, of an order authorizing a sale, or transfer, of estate
property.  The Third Circuit holds that a purchaser's good faith
relates to the purchaser's integrity in the context of the asset
sale.  Abbotts Dairies, 788 F.2d at 147.  Thus, a purchaser who
does not engage in fraud or collusion, and does not attempt to
obtain an unfair advantage is a good faith purchaser and should
be appropriately protected by the courts. The Debtors submit
that Buyer has acted in good faith in connection with the Sale
and, therefore, is a good faith purchaser under the Abbots
Dairies analysis.

Mr. Brady notes that the sale and operations transfer do not
dictate the terms of a plan of reorganization because the sole
effect is the transfer of certain assets of IHS-126's estate, no
distribution of the Debtors' assets will be made in the
transaction.

Divesting the Facility is essential to the Debtors'  
reorganization. Accordingly, the Debtors ask the Court to exempt
the divestiture of the Facility from all taxes. (Integrated
Health Bankruptcy News, Issue No. 44; Bankruptcy Creditors'
Service, Inc., 609/392-0900)   


INTEGRATED INFORMATION: Completes Comprehensive Fin'l Workout
-------------------------------------------------------------
Integrated Information Systems, Inc. (Nasdaq:IISX), a leading
provider of secure integrated information solutions, announced
the completion of a comprehensive settlement with creditors and
a substantial bank credit facility.

The creditor settlements significantly discount IIS' obligations
under vacated offices, equipment leases and other general
payables. Approximately $23 million of creditor obligations have
been settled. The bank credit facility funds creditors'
settlements and provides ongoing working capital. These actions
substantially strengthen IIS' balance sheet and operations
ability going forward and also result in a very significant
increase in IIS stockholders' equity.

With completion of this comprehensive financial restructuring
and bank credit facility, IIS will continue to consolidate with
like-minded peer consultancies, with the objective to be the
premier national Microsoft-focused IT services provider for U.S.
mid-market businesses. Notwithstanding the past two years of
industry contraction, IIS has already expanded through
consolidative acquisitions and organic growth into a number of
key regions including Northwest, Southwest, Rocky Mountain,
Midwest and Northeast.

"IIS rapidly expanded in 1999 and early 2000 prior to and after
the completion of our IPO," stated Jim Garvey, Chairman, Chief
Executive Officer and President of IIS. "That expansion required
us to make many commitments to support the then generally
perceived growth potential in our industry. Most of these
commitments were made at top of market. Subsequently, as a
result of the precipitous industry downturn that commenced in
late 2000, it became impossible for us to put these expansion
assets to effective and profitable use. In May, with 2002
shaping up as another tough market, we formulated the
comprehensive creditor settlement solution. The settlement
restructures our balance sheet, reduces our cost of ongoing
operations and establishes a regular bank credit facility. We
are happy to have implemented a balanced solution that was not
dilutive to our stock and option holders."

"The next significant wave of corporate spending will require
the secure integration of information systems across the entire
business value chain," continued Garvey. "IIS believes that web
services architectures and Microsoft(R).NET technology provide
the most cost effective and powerful platform for corporations
to dramatically change the way they do business in order to
obtain market advantage, significant productivity improvements
and substantial cost savings. IIS is well positioned at the
forefront of this new wave of value chain integration. In each
of the nationwide markets we serve, we remain committed to the
creation of significant shareholder value and substantial gain
for our customer, employee, supplier, financial and equity
stakeholders."

Integrated Information Systems(TM) is a leading provider of
secure integrated information solutions. IIS specializes in
securely optimizing, enhancing and extending information
applications and networks to serve employees, partners,
customers and suppliers. Founded in 1988, IIS employs more than
200 professionals, with offices in Boston; Denver; Madison;
Milwaukee; Phoenix; Portland, Oregon and Bangalore, India.
Integrated Information Systems' common stock is traded on The
Nasdaq SmallCap Market under IISX.

For more information on Integrated Information Systems, please
visit its Web site at http://www.iis.com


INTEGRATED TELECOM: Taps Pachulski Stang as Bankruptcy Counsel
--------------------------------------------------------------
Integrated Telecom Express, Inc., asks for permission from the
U.S. Bankruptcy Court for the District of Delaware to employ the
law firm of Pachulski, Stang, Ziehl, Young & Jones, PC as its
bankruptcy counsel.

The Debtor tells the Court that it needs to hire Pachulski Stang
under a general retainer effective as of the Petition Date to:

  a) provide legal advice with respect to its powers and duties
     as a debtor in possession in the operation and
     reorganization of its business and its properties;

  b) provide legal advice with respect to the liquidation of the
     Debtor's assets in this chapter 11 case;

  c) prepare and pursue confirmation of a liquidating plan and
     approval of a disclosure statement;

  d) prepare on behalf of the Debtors necessary applications,
     motions, answers, orders, reports, and other legal papers;

  e) appear in Court and protect the interest of the Debtor
     before the Court; and

  f) perform all other legal services for the Debtor that may be
     necessary and proper in these proceedings.

Pachulski Stang will bill the Debtor at its current and
customary hourly rates. The hourly rates for the professionals
presently designated to represent the Debtor in this case are:

          Laura Davis Jones           $550 per hour
          Tobias S. Keller            $390 per hour
          David W. Carickoff, Jr.     $280 per hour
          Ramon M. Naguiat            $225 per hour
          Patricia J. Jeffries        $140 per hour
          Cheryl A. Knotts            $120 per hour

Integrated Telecom Express, Inc., provides integrated circuit
and software products to the broadband access communications
equipment industry. The Company filed for chapter 11 protection
on October 8, 2002. When the Debtor filed for protection from
its creditors, it listed $115,969,000 in total assets and
$4,321,000 in total debts.


INTERLIANT INC: Obtains Approval to Access $5MM DIP Financing
-------------------------------------------------------------
Interliant, Inc. (OTCBB: INIT), a leading provider of managed
infrastructure solutions, announced that the U.S. Bankruptcy
Court for the Southern District of New York has approved its
agreement for Debtor-in-Possession financing with Access
Capital, Inc., a New York City based lender. Access Capital is
providing Interliant with a revolving credit facility with
maximum availability of $5 million. The credit facility is
secured by Interliant's accounts receivable, with additional
security in the company's assets.

Under a Final Order, signed by the bankruptcy court on October
9, 2002, Interliant now has a credit facility with $5 million
maximum availability. An Interim Order was entered by the court
on September 20, 2002 limiting Interliant's availability under
its credit facility to $1.5 million dollars through October 20,
2002. Interliant announced the closing of the agreement with
Access Capital on September 26, 2002.

"We are pleased that the court has given us its final approval
of this financing," said Francis J. Alfano, Interliant's
president and CEO. "This gives Interliant an added source of
funds to help us through our Chapter 11 reorganization and move
forward with our ongoing operations."

On August 5, 2002, Interliant filed for reorganization under
Chapter 11 of the U.S. Bankruptcy Code. The company is
reorganizing to focus on its core businesses that provide
recurring revenue and utilize its data center infrastructure:
managed messaging, managed hosting, and managed security
services, along with related professional services.

Interliant, Inc., is a leading provider of managed
infrastructure solutions, encompassing messaging, security and
hosting plus an integrated set of professional services that
differentiate and add customer value to these core solutions.
The company makes it easier and more cost-effective for its
customers to acquire, maintain and manage their IT
infrastructure via selective outsourcing. Headquartered in
Purchase, NY, Interliant has forged strategic alliances and
partnerships with the world's leading software, networking and
hardware manufacturers, including Check Point Software
Technologies Inc., IBM and Lotus Development Corp., Microsoft,
Oracle Corporation, and Sun Microsystems Inc. For more
information about Interliant, visit http://www.interliant.com


KAISER ALUMINUM: Secures Approval to Hire Mercer as Consultants
---------------------------------------------------------------
Kaiser Aluminum Corporation and its debtor-affiliates obtained
approval from the District of Delaware to sign-up Mercer Human
Resources Consulting as their employee compensation consultants
in these Chapter 11 cases, nunc pro tunc to April 17, 2002.  

With the Court approval, Mercer will perform these services:

A. review and analyze the Debtors' current and proposed
    compensation structure, focusing on key employees;

B. evaluate the competitiveness of the Debtors' compensation
    levels for key employees;

C. compare the Debtors' compensation programs to other companies
    that have gone through similar restructuring;

D. assist and advice the Debtors in developing and implementing
    new employee compensation and retention programs;

E. develop a severance program for the Debtors' employees and
    assist the Debtors in implementing that program; and,

F. provide other employee compensation and human resources
    consulting services as may be requested by the Debtors.

Pursuant to the terms of Mercer's engagement letter and subject
to the Court's approval, Mercer will be compensated for its
professional services in accordance with its customary billing
procedures plus reimbursements of actual and necessary out-of-
pocket expenses. Mercer's hourly rates are fixed:

A. $600 per hour for the services provided by Marshall Scott;
    and,

B. a maximum of $415 per hour for services provided by all other
    professionals employed by Mercer. (Kaiser Bankruptcy News,
    Issue No. 16; Bankruptcy Creditors' Service, Inc., 609/392-
    0900)   


KASPER ASL: Wants Benedetto Gartland to Continue as Advisors
------------------------------------------------------------
Kasper A.S.L., Ltd., and its debtor-affiliates want to continue
employing Benedetto, Gartland & Company, Inc., as their
financial advisors.

The Debtors received approval from the U.S. Bankruptcy Court for
the Southern District of New York to employ Benedetto Gartland
on an interim basis. The Debtors wish to extend this retention
until 60 days after the Debtors emerge from chapter 11.  

Specifically, Benedetto Gartland has and will:

  a) assist in satisfying creditors' information needs,
     including coordinating responses to creditors' information
     requests and assisting in timely dissemination of such
     information;

  b) assist in the preparation of various forms, reports,
     schedules and statements required by the Court and other
     regulatory agencies;

  c) continue analysis of business operations including
     evaluating financial modeling and cash flow forecasting
     processes;

  d) assist in monitoring, analyzing and preparing reports
     relating to the financial and operating performance of the
     Debtors' businesses;

  e) continue analysis of employee compensation and retention
     arrangements;

  f) confer with the Debtors on the preparation of financial
     projections and submissions to parties-in-interest;

  g) assist with analyses of potential sales of various assets
     of the Debtors, if any, including meetings and discussions
     with potential acquirers, appraisals and or valuations of
     certain assets or businesses as requested;

  h) advise and assist the Debtors in developing and negotiating
     capital structure scenarios;

  i) attend meetings and provide advisory assistance to the
     Debtors during their negotiations with banks and other
     lenders, the creditors' committee appointed in these
     chapter 11 cases, the United States Trustee for the
     Southern District of New York, other parties in interest,
     and professionals hired by the same, as requested;

  j) update enterprise valuation of Debtors' assets and
     businesses for plan of reorganization and other purposes
     and, where requested, written reports of same;

  k) render expert testimony and litigation support services, as
     requested from time to time by the Debtors and their
     counsel, regarding the feasibility of a plan of
     reorganization and other matters as may be requested by the
     Debtors and or Debtors' counsel; and

  l) provide other consultation or services as may be requested
     by the Debtors or their legal counsel in the operation and
     reorganization of the Debtors' businesses.

Under the terms of the Engagement Letter, Benedetto is paid
$250,000 for the term of the engagement.

In addition to the interim engagement, Benedetto Gartland will:

  a) provide an updated valuation of the company and its assets
     in connection with the proposed Plan in order to take into
     account changes in the Debtors' performance and in the
     financial markets since the initial valuation was
     completed;

  b) provide a further updated valuation at the time of the
     confirmation of the Debtors' Plan;

  c) at the Debtors' request, independently value the Debtors'
     trademarks for the financial institutions providing exit
     financing;

  d) at the Debtors' request, update the trademark valuation at
     the time of exit from bankruptcy and the drawdown of the
     exit financing; and

  e) provide an analysis and valuation to Ernst & Young of
     certain good-will and intangible accounts as required by
     FAS 142.

Benedetto will receive $100,000 for these additional services,
an initial payment of $50,000 upon the signing of the Amended
Engagement Letter, and $25,000 beginning on the first day of
each of the next two months.

Kasper A.S.L., Ltd., one of the leading women's branded apparel
companies in the United States filed for chapter 11 protection
on February 05, 2002. Alan B. Miller, Esq., at Weil, Gotshal &
Manges, LLP represents the Debtors in their restructuring
efforts. When the Company filed for protection from its
creditors, it listed $308,761,000 in assets and $255,157,000 in
debts.


KMART CORP: Obtains Court Approval to Expand PwC Engagement
-----------------------------------------------------------
Kmart Corporation and its debtor-affiliates obtained the green-
light from the U.S. Bankruptcy Court for the Northern District
of Illinois to amend the scope of the retention and employment
of PwC to include additional audit-related and certain tax
services on an as-needed basis in these Chapter 11 cases:

(1) Audit-Related Services

PwC has been engaged to audit the Debtors' consolidated
financial statements as of January 29, 2003 and for the year
then ending. Upon completion of the audit, PwC will provide the
Debtors with an audit report on the financial statements for the
year ending January 29, 2003.  In conjunction with the annual
audit, PwC will perform reviews of the Debtors' unaudited
consolidated quarterly financial statements and related data for
each of the first three quarters in the year ending January 29,
2003.

PwC estimates that its fees for this audit engagement will be
$1,900,000, exclusive of out-of-pocket expenses while the out-
of-pocket expenses and internal charges with respect to the
audit-related services will reach $100,000.

PwC may provide additional audit-related services as the Debtors
and PwC deem appropriate, including, but not limited to:

    (a) other related accounting services;
    (b) restructuring activities;
    (c) controls testing of System changes; and
    (d) implementation of new accounting standards.

These additional services will be the subject of separate
written agreements.

PricewaterhouseCoopers LLP is presently employed to provide
routine audit, audit-related and tax services to the Debtors as
an ordinary course professional.  

Additional services will be billed at an agreed upon rate, not
to exceed PwC's Audit Standard Hourly Rates:

              Professional                Rate
              ------------                ----
              Sr. Mgr. -- Partner      $515 - 680
              Managers                  425 - 460
              Sr. Associates            280 - 315
              Associates                180 - 215
              Interns                   145

Additionally, depending upon the nature of the additional
services, the audit professionals may seek other expertise
within the firm.  In this regard, PwC's Global Risk Management
Solutions practice is currently assisting the audit
professionals in a controls review of the Debtors' new general
ledger package. GRMS's services will also be billed at an agreed
upon rate, not to exceed the GRMS Standard Hourly Rates:

              Professional                Rate
              ------------                ----
              Director -- Partner      $645 - 890
              Manager -- Sr. Manager    475 - 670
              Sr. Associates            315 - 470
              Associates                200 - 290

(2) Tax Services

From time to time, PwC also may perform tax services for the
Debtors on an hourly basis or pursuant to a fixed-fee
arrangement at the direction of the Debtors' tax or human
resources departments.  In view of that, the fees for tax
consulting matters will typically be established on an hourly
basis at an agreed upon rate, not to exceed PwC's Tax Standard
Hourly Rates:

              Professional                Rate
              ------------                ----
              Director -- Partner      $563 - 720
              Manager -- Sr. Manger     463 - 666
              Sr. Associates            309 - 425
              Associates                219 - 282
              Intern                    142 - 229
              Administrator             103 - 140

On the other hand, fees for most tax compliance matters and
certain tax consulting matters will be on a fixed-fee basis.
However, fixed-fee projects and significant hourly fee projects
will be the subject of an engagement letter requiring the
approval of the Debtors' Vice President of Tax or other
appropriate representative of the Debtors, and all agreements
and fees related to tax services will be subject to the review
and objection rights of the United States Trustee, the Statutory
Committees and the Debtors' Audit Committee.

PwC also will separately bill the Debtors for reasonable out-of-
pocket expenses and internal charges for certain support
activities related to the provision of tax compliance and tax
consulting services to the Debtors.

(3) Non-Audit Services

On July 24, 2002, PwC publicly announced that it has entered
into a definitive agreement to sell its Business Recovery
Services practice to FTI Consulting, Inc.  This transaction
closed effective August 31, 2002 and the BRS Practice has
concluded its work with the Debtors as of the Closing Date.

However, PwC will continue to provide other non-audit services,
such as bankruptcy tax and other financial advisory services, to
the Debtors.

(4) Other Services

PwC may be requested or authorized by the Debtors or required by
government regulation, subpoena, or other legal process to
produce its working papers or its personnel as witnesses with
respect to the audit engagement, including the pending
investigations of the Debtors, so long as PwC is not a party to
the proceeding in  which the information is sought.  In that
event, the Debtors will pay PwC for its professional time and
expenses, as well as the fees and expenses of PwC's counsel.
(Kmart Bankruptcy News, Issue No. 35; Bankruptcy Creditors'
Service, Inc., 609/392-0900)

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


LERNOUT: Wants Until Year-End Solicit Votes on Chapter 11 Plan
--------------------------------------------------------------
As the only Debtor remaining without a confirmed plan, Lernout &
Hauspie Speech Products, NV, asks Judge Wizmur to extend once
more its exclusive period to solicit acceptances of its plan
through and including December 31, 2002.

Luc A. Despins, Esq., Matthew S. Barr, Esq., and James C. Tecce,
Esq., at Milbank Tweed Hadley & McCloy LLP, in New York, and
Robert J. Dehney, Esq., Gregory W. Werkheiser, Esq., and Donna
L. Harris, Esq., at Morris Nichols Arsht & Tunnell, in
Wilmington, Delaware, tell the Court that in light of the SEC
complaint, this may be a more difficult undertaking than what is
usually encountered in large Chapter 11 cases. Even before the
SEC complaint was filed, the Motion for this extension was
conditioned on L&H NV's agreement that the L&H Creditors'
Committee can seek to terminate exclusivity at any time, and in
that event L&H NV will bear the burden of proving that "cause"
exists for exclusivity to continue.

Mr. Werkheiser points out that these Chapter 11 cases nearly
have completed their third and final phase.  With the completion
of the Dictaphone and Holdings cases, attention is now directed
entirely toward L&H NV.  Mr. Werkheiser notes that "significant
progress" has been made with respect to L&H NV and the
resolution of its case. Following extensive negotiations among
the Curators, the L&H Creditors' Committee, and certain of L&H
NV's prepetition lenders, L&H NV has modified the joint plan,
transforming it into a Chapter 11 plan relating exclusively to
claims against and equity interests in L&H NV. Only a few issues
remain subject to final negotiation.  Indeed, L&H NV anticipates
resolving these matters shortly and intends to file the L&H NV
Disclosure Statement and L&H NV Plan in October 2002.

L&H NV, therefore, seeks an extension of the solicitation period
in order to provide sufficient time to seek approval of the L&H
NV Disclosure Statement, and thereafter, to solicit acceptances
of the L&H NV Plan.  The requested extension is narrowly
tailored to afford L&H NV sufficient time to accomplish these
objectives.  Furthermore, the L&H NV Creditors' Committee has
indicated that it does not oppose the requested extension.

By application of Del.Bankr.LR 9006-2, the current deadline is
automatically extended through the conclusion of the October 22,
2002 hearing. (L&H/Dictaphone Bankruptcy News, Issue No. 31;
Bankruptcy Creditors' Service, Inc., 609/392-0900)  


LTV CORP: Opts to Reorganize Copperweld as a Stand-Alone Company
----------------------------------------------------------------
The LTV Corporation has decided to reorganize Copperweld as a
stand-alone company.  The Company and its creditors are
developing a separate plan of reorganization by which Copperweld
would emerge from bankruptcy at the earliest opportunity. LTV
said that the restructuring effort would focus on preparing
Copperweld to achieve long-term success as an independent
business.

Copperweld is the largest producer of welded steel tubing in
North America and the largest manufacturer of bimetallic wire
products in the world.  It operates 17 facilities in the US,
Canada and Great Britain and employs approximately 2900 people.

"The reorganization of Copperweld as a stand-alone business will
provide the greatest value to the greatest number of people,
including our employees, customers, suppliers, and creditors.  
We are very encouraged about the opportunity to emerge from
chapter 11 with all of our resources focused on serving the
needs of our customers who have demonstrated their loyalty to us
throughout this challenging period," said John Turner, chairman
and chief executive officer of the Copperweld Corporation.

Copperweld, which has maintained profitable operations
throughout LTV's bankruptcy, will continue to serve its
customers with the highest quality products, pay its post-
petition suppliers, and pursue its objective of consistent
profitability and long-term growth.  Copperweld has debtor-in-
possession financing (separate from that of The LTV Corporation
and LTV Tubular Products Company) through GE Commercial Finance.

LTV has also announced that it has agreed to sell the assets of
its LTV Tubular Products business to Maverick Tube Corporation.  
LTV Tubular has headquarters and operations in Youngstown, Ohio,
and also operates plants in Elyria, Ohio; Ferndale, Michigan;
Counce, Tennessee; and Cedar Springs, Georgia.  The business
employs approximately 430 people.

The LTV Corporation, along with 48 subsidiaries, filed voluntary
petitions for relief under Chapter 11 of the U.S. Bankruptcy
Code on December 29, 2000. The cases were filed in the U.S.
Bankruptcy Court, Northern District of Ohio, Eastern Division
and jointly administered as Case No. 00-43866.

The LTV Corporation believes that shares of its common stock are
worthless because the value expected to be generated by the sale
of assets and the reorganization of the Copperweld operations
will be insufficient to provide any recovery for common
shareholders.


LTV: Copperweld Names McGlone Pres. & Chief Operating Officer
-------------------------------------------------------------
Copperweld announced the promotion of Dennis McGlone to
President and Chief Operating Officer in a management
restructuring that prepares the company to emerge from Chapter
11 as a stand-alone company.  John D. Turner continues as
Chairman and Chief Executive Officer of the steel tubing and
bimetallic products firm.

Thomas W. Muth has been named to replace Mr. McGlone as Vice
President, Marketing & Sales, Tubular Products Group.

"The restructuring of our senior management team will prepare us
to emerge as quickly as possible from the bankruptcy process,"
Mr. Turner said.  "The resulting Copperweld will retain all of
our original core businesses as well as the previously acquired
Welded Tube Company of America.  The assets of our Pipe &
Conduit Group, the former LTV Tubular Products Company, are
being sold separately by The LTV Corporation."

Mr. Turner added that, "Copperweld Canada, Inc., which includes
our Automotive Group as well as structural and mechanical tubing
facilities in Ontario and Manitoba, and our bimetallics plant in
Telford, England, have not and will not be a part of the
bankruptcy restructuring.  These businesses will, however,
remain a part of Copperweld as the rest of the company
restructures and emerges from Chapter 11."

Mr. Turner said that he will focus on the strategic and
restructuring issues facing Copperweld, working closely with its
primary secured lender, GE Commercial Finance, while Mr. McGlone
directs the company's day-to-day operations.  "We feel that this
will best meet our objective of providing stability and security
for our customers, suppliers and employees," he concluded.

Reporting to Mr. Turner in the new management structure will be
Douglas E. Young, Vice President and Chief Financial Officer,
William F. Morgan, Vice President, Information Systems, and
Eugene R. Pocci, Vice President, Human Resources, as well as
David L. Carroll, Vice President and General Manager, Pipe &
Conduit Group.

Reporting to Mr. McGlone will be Douglas J. Hahn, Vice President
and General Manager, Automotive Group; Steven E. Levy, Vice
President and General Manager, Bimetallic Products; James R.
Baske, Vice President Operations, Mechanical Group; David W.
Seeger, Vice President Operations, Structural Group; T. Rhett
Heyward, Vice President, Materials & Services, and Mr. Muth.

Mr. McGlone, Copperweld's new President, has had more than 26
years of experience in the steel industry.  Prior to joining
Copperweld in 2001 as Vice President of Sales, Tubular Products
Group, he had been Vice President- Commercial and a corporate
officer of AK Steel, heading the national and international
sales of its specialty products.  Previously he served as Senior
Vice President, Marketing & Sales, for Armco, Inc., which merged
with AK Steel in 1999, and, before that, as President of Armco's
Coshocton Stainless Division.  He holds a B.S. degree in
metallurgical and materials engineering from the University of
Pittsburgh.

Mr. Muth joined Copperweld in 1991 as Manager, International
Market Development.  He has held positions of increasing
responsibility in the company's steel tubing marketing and sales
organization, serving most recently as General Manager,
Marketing & Sales for the North American Structural Group. He
holds a BA degree from Mount Saint Mary's College and a Masters
degree from the University of Pittsburgh's Graduate School of
Public and International Affairs.

Copperweld is the largest producer of steel tubing in North
America and the world leader in the manufacture of bimetallic
wire products.  The company is headquartered in Pittsburgh and
operates manufacturing facilities in 17 locations in the United
States, Canada and the United Kingdom.

LTV Corporation's 11.75% bonds due 2009 (LTVC09USR1) are trading
at half a penny on the dollar, DebtTraders reports. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=LTVC09USR1
for real-time bond pricing.


MARINER POST-ACUTE: Has Until Feb. 28, 2003 to Challenge Claims
---------------------------------------------------------------
The Mariner Post-Acute Network, Inc. Debtors sought and obtained
a Court order extending the deadline for filing objection to
claims in their Chapter 11 cases until February 28, 2003.

To date, the Debtors have resolved 26,000 of the nearly 32,000
filed and scheduled claims in the Chapter 11 cases in the MPAN
and MHG cases.  The Debtors admit that the resolution of the
claims has been more difficult than expected because of:

    (a) the need to adjust scheduled amounts based on payments
        made on account of critical vendors,

    (b) the need to compare scheduled claims to the lists of
        assumed contracts,

    (c) the need to compare scheduled claims to orders entered
        approving compromises, and

    (d) problems related to matching filed claims to scheduled
        claims, particularly in circumstances where numerous
        claims were filed of the same vendor.

The Debtors explain that resolution of filed claims entails the:

    (a) review of trade claims by the Reorganized Debtors'
        accounts payable department, including the need to
        reconcile scheduled amounts with claims, which may have
        been filed by several branches of the same vendor on a
        regional basis,

    (b) review of assumed and rejected unexpired leases and
        executory contracts by numerous different working groups
        within the Reorganized Debtors,

    (c) analysis of damage claims arising from the rejection of
        unexpired leases and executory contracts,

    (d) review of all prior settlements in the cases for
        releases involving claims,

    (e) identification of duplicate and superseded claims,

    (f) identification of claims for reimbursement, contribution
        and indemnity,

    (g) identification and analysis of unliquidated and
        contingent claims,

    (h) review of asserted claims for priority or administrative
        status,

    (i) reconciliation of paid claims to taxing authorities,

    (j) review of claims based upon shareholders interests or
        damage claims relating to the purchase or sale of the
        Debtors' securities,

    (k) review and reconciliation of claims filed in one or both
        of the MPAN and MHG cases, that assert claims against
        the estates in both the MHAN and MHG cases, and

    (l) continuing efforts to resolve personal injury claims.

The Debtors expect to complete their analysis of the remaining
unresolved claims and to conclude their initial efforts to
negotiate settlements without the need for filing formal
objections by January 2003.  Hence, the Court afforded the
Debtors until February 2003 to prepare objections to any claims
that remain unresolved by the end of January 2003.

Under the Reorganization Plan, the term "Claims Objection
Deadline" is defined to mean the later of:

      (i) the 180th day after the Effective Date,

     (ii) with respect to a specific Claim, the 180th day after
          proof of the Claim is filed,

    (iii) with respect to a Claim that is subject to the ADR
          Procedure, the 90th day after the holder of the Claim
          either has opted out of the ADR Procedure by executing
          the necessary stipulation or has completed the
          requirements of the ADR Procedure, or

     (iv) the greater period of limitation as may be fixed or
          extended by the Bankruptcy Courts or by agreement
          between a Debtor and the holder of the Claim. (Mariner
          Bankruptcy News, Issue No. 35; Bankruptcy Creditors'
          Service, Inc., 609/392-0900)  


METALS USA: Court OKs Indiana Property Sale to Butler for $1.4M+
----------------------------------------------------------------
Metals USA, Inc., and its debtor-affiliates obtained the go-
signal from the U.S. Bankruptcy Court for the Southern District
of Texas to proceed with the sale of its Butler, Indiana
facility to Butler Properties, LLC, an Indiana limited liability
company, for $1.425 million.

The Debtors' Butler, Indiana facility, was used as a metal
service center for the processing of metals.  The Debtors are
not reaping any profits from the operation of this facility.  
Hence, the Debtors decided to sell the facility.  

The Second Asset Purchase Agreement with Butler, governing the
proposed sale, includes these terms:

A. Real Property to be purchased:  The real property situated at
   4211 County Road 61 in Dekalb County, Indiana, together with
   certain fixtures, equipment, and other personal property;

B. Proposed Buyer:  Butler Properties, LLC, an Indiana limited
   liability company;

C. Purchase Price:  $1,425,000.  The Purchase Price consists of
   two components, which include:

    -- $1,350,000 for the real property and other fixtures,
       equipment and personal property, and

    -- $75,000 for the Stamco Slitter, which is a large item of
       equipment used in metal work;

D. Broker Commissions:  2.5% of the purchase price. (Metals USA
Bankruptcy News, Issue No. 21; Bankruptcy Creditors' Service,
Inc., 609/392-0900)


NEON COMMUNICATIONS: Court Approves $12.5 Million DIP Financing
---------------------------------------------------------------
The Honorable Judge Peter Akard granted Neon Communications,
Inc., and Neon Optica, Inc., authority to obtain $12.5 million
of postpetition financing pursuant to the terms of the
Postpetition Credit Agreement.  The Credit Agreement was entered
into by and among Mackay Shields LLC, Commnwealth Advisors,
Inc., Romulus Holdings, Inc., Lutheran Brotherhood, Lampe,
Conway & Co., LLC, Bay Harbour Management, and Loeb Partners
Corp., and other qualified creditors who elect to participate up
to their Pro Rate Share of not less than $25,000.

The Court has determined that an immediate and ongoing need
exists for the Debtors to obtain financing in order to preserve
the value of their business and assets as debtors-in-possession
under chapter 11 of the Bankruptcy Code and to minimize the
disruption of the Debtors as going concern.

The Debtors were unable to obtain financing in the form of
unsecured credit allowable under the Bankruptcy Code as an
administrative expense.  Other than the financing from the DIP
Lenders, the Debtors are unable to obtain financing in the form
of credit secured by liens on property of the Debtors' estates.

The term of the DIP financing arrangement ends on the earliest
of:

     i) November 15, 2002, or

    ii) the effective date of any confirmed plan of
        reorganization, or

   iii) the date on which the payment of the DIP Loans becomes
        due providing for the acceleration of the Loans and the
        termination of the Postpetition Facility.

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


NETIA: Receives Ruling from Polish Court re Millennium Deal
-----------------------------------------------------------
Netia Holdings S.A. (WSE:NET), Poland's largest alternative
provider of fixed-line telecommunications services (in terms of
value of generated revenues), announced that on October 15, 2002
it received a ruling of the Polish Chamber of Commerce
Arbitration Court dated October 1, 2002, regarding the case
between the Company and Millennium Communications S.A., and
Newman Finance Corporation in connection with the Share
Subscription Agreement dated August 8, 2000.

The Arbitration Court dismissed Millennium and Newman's direct
claims against the Company for: (i) declaration of the Share
Subscription Agreement void and ineffective and (ii) payment of
PLN 11,500,000 by the Company. The Arbitration Court also
dismissed the Company's counter-claim for damages in the amount
of PLN 8,500,000.

The Company's management board intends to petition the proper
court of law to set aside the Ruling, claiming, among other
things, material breaches of material law and arbitration
procedures by the Arbitration Court.

A separate action by the Company against Millennium for the
repayment of a loan in the amount of PLN 11,500,000 is still
pending before the District Court in Warsaw.

Netia Holdings BV's 13.75% bonds due 2010 (NETH10NLN1), with
Netia Holdings SA as underlying issuer, are trading at 16 cents-
on-the-dollar, DebtTraders says. For real-time bond pricing, see
http://www.debttraders.com/price.cfm?dt_sec_ticker=NETH10NLN1


NETWORK ACCESS: Maintains Plan Filing Exclusivity Until Dec. 31
---------------------------------------------------------------
By order of the U.S. Bankruptcy Court for the District of
Delaware, Network Access Solutions Corporation and NASOP, Inc.,
obtained an extension of their exclusive periods.  The Court
gives the Debtors, until December 31, 2002, the exclusive right
to file their plan of reorganization and until March 3, 2003 to
solicit acceptances of that Plan.

Network Access Solutions Corporation is a provider of broadband
network solutions and internet service to business customers.  
The Company filed for chapter 11 protection on June 4, 2002.
Bradford J. Sandler, Esq., at Adelman Lavine Gold and Levin, PC
represent the Debtors in their restructuring efforts. When the
Company filed for protection from its creditors, it listed
$58,221,000 in assets and $84,946,000 in debts.


NEXIQ TECH: Voluntary Chapter 11 Case Summary
---------------------------------------------
Debtor: Nexiq Technologies, Inc.
        aka WPI Group, Inc.
        6405 Nineteen Mile Road
        Sterling Heights, MI 48314

Bankruptcy Case No.: 02-63996

Chapter 11 Petition Date: October 11, 2002

Court: Eastern District Of Michigan (Detroit)

Judge: Walter Shapero

Debtor's Counsel: I. William Cohen, Esq.
                  Pepper, Hamilton & Scheetz
                  100 Renaissance Center
                  36th Floor
                  Detroit, Michigan 48243
                  313-393-7341

Total Assets: $12,645,359 (as of June 30, 2002)

Total Debts: $49,711,072 (as of June 30, 2002)


NOGA ELECTRO-MECHANICAL: Fails to Meet Nasdaq Listing Guidelines
----------------------------------------------------------------
In accordance with NASDAQ Marketplace Rule 4815(b), Advocate
Zuriel Lavie, the Trustee appointed by the Court, hereby gives
notice that on October 8, 2002 the Company received a NASDAQ
Staff Determination indicating that after reviewing the Form 8-K
dated September 18, 2002 in which the Company disclosed that it
has filed an application in the Court, similar to filing for
protection under Chapter 11 of the U.S. Bankruptcy Code in the
United States, requesting that the Court issue the Order to
suspend all legal proceedings against the Company and also to
appoint a trustee to manage the Company's operations until
either a settlement is reached with the Company's creditors or a
receiver is appointed and/or a winding up order is issued by the
Court, and such other information as is publicly available, and
in accordance with Marketplace Rules 4330(a)(1)* and
4330(a)(3)**, NASDAQ Staff has determined that the Company's
securities will be delisted from the NASDAQ Stock Market at the
opening of business on October 15, 2002, unless the Company
requests a hearing in accordance with Marketplace Rule 4800
Series. The Staff determination is based on the following
factors:

     -- The Filing and associated public interest concerns
raised by it;

     -- Concerns regarding the residual equity interest of the
existing listed securities holders;

     -- Concerns about the suspension of all of the Company's
operations;

     -- Concerns that there has been a transfer of all
management powers to the Trustee, effectively replacing the
Company's officers and directors; and

     -- Concerns about the Company's ability to sustain
compliance with all requirements for continued listing on the
NASDAQ Stock Market.

As a result of the Filing, the fifth character "Q" has been
appended to the Company's trading symbols. At the opening of
business on October 7, 2002, the trading symbols for the
Company's ordinary shares and warrants were changed from NOGAF
to NOGAQ and NOGWF to NOGWQ, respectively.

The Trustee, on behalf of the Company, will appeal the Staff's
determination to the Panel, pursuant to the procedures set forth
in the NASDAQ Marketplace Rule 4800 Series. A delay was
requested and denied. Therefore, the appeal will be sent to the
Hearings Department by no later than 4:00 p.m. Eastern Time on
October 14, 2002.

The Company has not paid the annual invoice dated January 24,
2002 in the amount of $10,000.00 that was due in accordance with
Marketplace Rule 4500 Series. Therefore, the Company does not
comply with Marketplace Rule 4310(C)(13), and it must either pay
the fees within the next seven calendar days. Failure to do so
will constitute an additional basis for delisting. In accordance
with the requirements of the law of Israel, the Trustee is
required to apply to the Court for permission to pay the fees.

     * Marketplace Rule 4330(a)(1) states that "Nasdaq may, in
accordance with Rule 4800 Series, deny inclusion or apply
additional or more stringent criteria for the initial or
continued inclusion of particular securities or suspend or
terminate the inclusion of an otherwise qualified security if an
issuer files for protection under any provision of the federal
bankruptcy laws."

    ** Marketplace Rule 4330(a)(3) states that "Nasdaq may, in
accordance with Rule 4800 Series, deny inclusion or apply
additional or more stringent criteria for the initial or
continued inclusion of particular securities or suspend or
terminate the inclusion of an otherwise qualified security if
Nasdaq deems it necessary to prevent fraudulent and manipulative
acts and practices, to promote just and equitable principles of
trade, or to protect investors and the public interest."


NOMURA ASEET: Fitch Places B-Rated Class B-2 Notes on Watch Neg.
----------------------------------------------------------------
Nomura Asset Securities Corp.'s commercial mortgage pass-through
certificates, series 1996-MDV $33.7 million class B-2 rated 'B'
is placed on Rating Watch Negative. The $91.2 million class A-
1A, $352.0 million class A-1B, $7.5 million class A-1C, and
interest-only classes CS-1 and CS-2 are affirmed at 'AAA'. In
addition, the following classes are affirmed as follows: the
$45.0 million class A-2 'AA+'; the $52.4 million class A-3 'A+';
the $48.7 million class A-4 'BBB'; the $11.2 million class A-5
'BBB-'; the $48.7 million class B-1 'BB'; and the $24.4 million
class S-1 'BBB-'. Fitch does not rate class B-2H. The rating
actions follow Fitch's annual review of the transaction, which
closed in March 1996.

The Horizon factory outlet center pool and all the hotels, in
particular the Marriott Residence Inn II Pool, have had
declining operating performance. The placement of the B-2 class
on Rating Watch Negative is primarily due to the deterioration
of the operating performance of Marriott Pool loan. Unless the
RevPAR and/or net cash flow for the Marriott Pool improve by
year-end 2002, a downgrade of the B-2 class is likely. The class
will remain on RWN until the operating information is available.
Currently, 58% of the loans by pool balance have an investment
grade credit assessment, compared to 43% at issuance. This
improvement, coupled with the paydowns due to amortization,
counterbalance the concerns on the hotel loans and the Horizon
loan with respect to the other classes in the transaction.

As of the October 2002 distribution date, the pool's total
principal balance has been reduced by 7.6% to $714.9 million
from $773.7 million at issuance due to amortization on eight of
the ten loans. The pool consists of ten fixed-rate loans secured
by 92 geographically diverse retail, industrial, office and
hotel properties. In addition, 16 properties in two pools, with
an original outstanding allocated loan balance of $21 million,
were defeased at 125%. Six loans are crossed mini pools and four
loans are secured by single assets.

As part of its review, Fitch analyzed the performance of each
loan and the underlying collateral. Fitch compared each loan's
debt service coverage ratio at issuance to the trailing twelve
months ended March 2002 DSCR and the TTM June 2001 DSCR. DSCR's
are based on Fitch adjusted net cash flow and a stressed debt
service based on the amortized balance. The overall Fitch
stressed weighted average DSCR for TTM March 2002 decreased to
1.89 times from 2.01x as of TTM June 2001, but increased from
1.56x at issuance.

The Marriott Residence Inn II Loan, representing 18.9% of the
pool, is collateralized by 22 extended stay hotels, which are
located in 16 states. Adjusted NCF for TTM March 2002 declined
by 10.1% from TTM June 2001 and 20.0% from issuance. The
corresponding DSCR, based on a 10.48% hypothetical mortgage
constant, is at 1.24x compared to 1.36x for the prior year and
1.43x at closing. TTM March 2002 RevPAR declined significantly
from year-end 2000, reflecting the effects of 9/11 and the
downturn in the economy.

The Horizon Loan, representing 8.6% of the pool, is
collateralized by four factory outlet centers, in Wisconsin,
Washington, and Indiana. Adjusted NCF for TTM March 2002 has
declined by 10.5% from TTM June 2001 and 14.0% from issuance.
The corresponding DSCR, based on a 10.09% hypothetical mortgage
constant, is at 1.45x compared to 1.60x for the prior year and
1.55x at closing. The drop in overall occupancy of the pool to
86% as of June 2002 is of particular concern.

The other hotel properties, Shaner Hotel Pool Loan (Shaner),
Buena Vista Palace (Buena), and Innkeepers Pool (Innkeepers)
have also had declining operating performance. Adjusted NCF for
TTM March 2002 has declined by 11.0%, 16.6%, and 34.5%,
respectively, from TTM June 2001. However, the adjusted NCF for
Buena and Innkeepers remain above the NCF at issuance.

The Shaner Loan is divided into two parts: the standard note,
which is part of the overall pool (representing 9.4% of the
pool) and the junior flexible note which is rated on a stand
alone basis and forms its own separate tranche, class S-1.
Adjusted NCF for TTM March 2002 for the twenty-three properties
remaining in the pool has declined by 33.6% from closing. The
decline in net cash flow is due to the decline in RevPAR and
increases in expenses such as utilities and repairs and
maintenance. The standard note benefits from the amortization of
the whole loan applied entirely to the standard note and from
the partial defeasance of the allocated loan balance of twelve
properties ($17 million) at 125%. The corresponding DSCR for the
standard note, based on a 10.48% hypothetical mortgage constant,
is at 2.44x compared to 2.50x for the prior year and 2.26x at
closing. The corresponding DSCR for the standard and junior
flexible note together is at 1.59x compared to 1.72x for the
prior year and 1.76x at closing. The corresponding DSCR for the
notes together based on an actual debt service is at 1.22x.

The Crescent Pool is the largest loan, representing 23.3% of the
pool. The loan is collateralized by 12 properties (two full-
service hotels, nine office buildings and one anchored retail
center) in four states. Adjusted NCF for TTM March 2002 has
decreased 4.7% compared to TTM June 2001, but has increased
58.3% from issuance. The corresponding DSCR, based on a 9.56%
hypothetical mortgage constant, is at 2.32x compared to 2.44x
for the prior year and 1.47x at closing. The drop in NCF is
mostly attributable to the decline in operating performance of
the two hotels, Hyatt Regency hotels in Albuquerque, NM and
Beaver Creek, CO, and an office property in Colorado Springs,
CO. Average occupancy for the office and retail properties at
March 2002 was 89.6%, down from 94.2% as of June 2001.

The other retail properties have performed well compared to
issuance. TTM March 2002 DSCR's compared to TTM June 2001 and at
issuance are as follows: Bay Plaza (9.5% of the pool), 1.92x,
1.81x, and 1.35x; Beltway Plaza (8.7%), 1.31x, 1.26x, and 1.25x;
and Barnes Mall (6.1%), 1.62x, 1.36x, and 1.22x.

The adjusted NCF for the First Industrial Pool Loan (5.4%)
properties have declined due to a drop in occupancy as of
6/30/2001. However, occupancy has increased back to 92.7% as of
6/30/2002. In addition, 10% of First Industrial has been
partially defeased at 125%. This loan matures in January 2003.

Fitch will continue to monitor this transaction, as surveillance
is ongoing.


NOMURA ASSETS: Fitch Drops Ratings on 1994-MD1 B-3 Classes to D
---------------------------------------------------------------
Nomura Asset Securities Corporation, commercial mortgage pass-
through certificates, series 1994-MD1 class B-3A, B-3B and B-3P
are downgraded to 'D' from 'C'. The classes are also removed
from Rating Watch Negative. In addition to the downgrade, the
following classes remain on Rating Watch Negative due to
interest shortfalls: $22.3 million class A-3 and interest-only
class A-3X rated 'AAA', the $26.7 million class B-1 rated 'CCC'
and the $24.6 million class B-2 rated 'C'.

The downgrade follows the realized loss in the amount of $31.6
million that was applied to the B-3 classes. The realized loss
is attributed to the disposition of the Rolling Acres loan. The
classes will remain on Rating Watch Negative until the
cumulative interest shortfalls on the classes are paid in full.
The likelihood of a full recovery of the interest shortfalls on
the B-1 and B-2 classes depends on the timing of the resolution
of the Canton Centre loan and the timely receipt of debt service
payments on the Oly Realty loan.

The realized loss on the Rolling Acres loan was equal to the
full outstanding principal balance of the loan. Net liquidation
proceeds were $2.75 million. Due to unrecoverable advances, the
total loss to the bondholders will be $35.6 million, some of
which will be realized as a principal realized loss and the
remainder will be captured by not distributing interest and
principal payments to bondholders until the advances have been
repaid in full.

Two loans remain in the pool, Canton Centre and Oly Realty One.
The Canton Centre loan, secured by a regional mall in Canton, OH
is real estate owned. The property does not produce sufficient
cash flow after expenses to cover debt service payments. The
master servicer, GMAC Commercial Mortgage (GMACCM), has deemed
the loan non-recoverable and has stopped advancing. The Oly
Realty One loan is secured by 20 limited service hotels. The
loan continues to perform and currently pays debt service of
$714,330 per month. This debt service payment is currently being
used to reimburse GMACCM for the remaining advances due on
Rolling Acres. GMACCM will be fully repaid in four months, at
which time class A-3 and A-3X will begin recouping prior
shortfalls.


NOVA CDO: S&P Puts Four B-Rated Note Classes on Watch Negative
--------------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings on the
class B, C-1, C-2, D-1, and D-2 notes issued by NOVA CDO 2001
Ltd., an arbitrage CBO transaction, on CreditWatch with negative
implications. At the same time, the rating on the class A notes
has been affirmed based on a financial guarantee insurance
policy issued by Financial Security Assurance Inc.

The CreditWatch placements reflect factors that have negatively
affected the credit enhancement available to support the rated
notes since the transaction was originated in May of 2001. These
factors include par erosion of the collateral pool securing the
rated notes, deterioration in the credit quality of the
performing assets within the pool, and a reduction in the
weighted average coupon generated by the performing assets
within the pool.

As a result of asset defaults and credit risk sales at
distressed prices, the overcollateralization ratio for the
transaction has deteriorated significantly since the transaction
was originated. As of the Sept. 16, 2002 trustee report, the
class B overcollateralization ratio test was failing, with a
ratio of 109.53% versus the minimum required ratio of 111.5%.
The class C and D overcollateralization ratios were passing, but
have seen deterioration since origination. The class C
overcollateralization ratio was 104.12%, compared with a ratio
of 110.19% on the effective date; and the class D
overcollateralization ratio was 101.40%, compared with a ratio
of 105.08% on the effective date.

The credit quality of the collateral pool has also deteriorated
since the transaction was originated. Currently, $30.4 million
(or approximately 11%) of the performing assets in the
collateral pool come from obligors whose ratings are on
CreditWatch negative.

Furthermore, according to the most recent trustee report, the
weighted average coupon test was failing with an average of
9.954% versus the required minimum of 10%.

Standard & Poor's will be reviewing the results of current cash
flow runs generated for NOVA CDO 2001 Ltd., to determine the
level of future defaults the rated tranches can withstand under
various stressed default timing and interest rate scenarios
while still paying all of the interest and principal due on the
notes. The results of these cash flow runs will be compared with
the projected default performance of the performing assets in
the collateral pool to determine whether the ratings assigned to
the notes remain consistent with the credit enhancement
available.

               Ratings Placed On Creditwatch Negative

                         NOVA CDO 2001 Ltd.

                         Rating
          Class     To              From       Balance (Mil. $)
          B         BBB/Watch Neg   BBB        17.10
          C-1       BB-/Watch Neg   BB-        3.50
          C-2       BB-/Watch Neg   BB-        9.70
          D-1       B-/Watch Neg    B-         9.40
          D-2       B-/Watch Neg    B-         3.60

                          Rating Affirmed

                         NOVA CDO 2001 Ltd.

          Class        Rating                Balance (Mil. $)
          A            AAA                   237.00


OWENS CORNING: Seeks Approval to Modify and Extend DIP Financing
----------------------------------------------------------------
Owens Corning and its debtor-affiliates ask the Court to extend
and modify the Debtors' current DIP Financing, which is set to
expire on November 15, 2002.

J. Kate Stickles, Esq., at Saul Ewing LLP, in Wilmington,
Delaware, tells the Court that the Debtors have entered into
discussions with their Lenders regarding their Postpetition
Credit Agreement to provide for, among other things:

-- an extension of its termination date,

-- a reduction in the maximum Commitment under the Postpetition
   Credit Agreement from $500,000,000 to an amount up to
   $300,000,000, and

-- a modification of certain financial and other covenants
   and provisions or representations and warranties contained in
   the Postpetition Credit Agreement.

Ms. Stickles relates that although the Lenders have not yet
provided any commitment, the Debtors anticipate that their
negotiations with the Lenders will result in an agreement for a
mutually acceptable amendment to the Postpetition Credit
Agreement.  The Debtors are only filing this motion in order to
give creditors and parties-in-interest notice of the nature of
the contemplated Amendment at the earliest possible time.

The Debtors tell Judge Fitzgerald to expect a supplemental
motion once the amendments are finalized. (Owens Corning
Bankruptcy News, Issue No. 39; Bankruptcy Creditors' Service,
Inc., 609/392-0900)   

Owens Corning's 7.7% bonds due 2008 (OWC08USR1), DebtTraders
reports, are trading at 30 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=OWC08USR1for  
real-time bond pricing.


PACIFIC BASIN: Files for Chapter 7 Liquidation in California
------------------------------------------------------------
On October 11, 2002 Pacific Basin Foods, Inc., a wholly owned
subsidiary of San Diego, CA based Steakhouse Partners, Inc.,
(OTC: SIZLQ) filed for bankruptcy protection under Chapter 7 of
the United States Bankruptcy Code in the Central District of
California located in Riverside.  

The Company reported in the documents filed with the Bankruptcy
Court that total assets of Pacific Basin Foods, Inc., were $0.2
million and total liabilities were $1.4 million as of the filing
date.

The Company also announced that it has signed a contract with a
UniPro Distributor, Southwest Traders, Inc., to distribute food
and other products to its West coast units that were previously
supplied by Pacific Basin Foods, Inc.  Management of the Company
does not anticipate any disruption in service to its West coast
restaurant units during this transition.  In June the Company
contracted with two UniPro Distributors, Abbott Foods Inc., and
EG Forrest Co., to supply its Midwest units.

Steakhouse Partners, Inc., operates 53 full-service steakhouse
restaurants located in ten states.  The Company's restaurants
specialize in complete steak and prime rib meals, and offer
fresh fish and other lunch and dinner dishes. The Company
operates principally under the brand names of Hungry Hunter's,
Hunter's Steakhouse, Mountain Jack's, and Carvers.


PG&E NATIONAL: Moody's Hatchets Units' Ratings to Lower-B Levels
----------------------------------------------------------------
Moody's Investors Service lowered the credit rating of several
units of PG&E Corporation's subsidiary PG&E National Energy
Group.

Wednesday's action by Moody's lowered the ratings of the
following wholly owned PG&E NEG units:

-- PG&E Gas Transmission, Northwest Corporation to Baa3 from
   Baa2

-- USGen New England, Inc. to Ba3 from Baa3

-- Attala Generating Company, LLC to Ba3 from Baa3

Moody's left in place its current rating of B1 for PG&E NEG.  
The ratings agency indicated, however, that it continues to
review the current credit ratings of PG&E NEG and its units for
possible future downgrade.

PG&E Corporation noted that Moody's revised rating on PG&E Gas
Transmission, Northwest Corporation to Baa3, still kept the unit
at an investment grade credit level, although Standard & Poor's
October 11, 2002 downgrade of PG&E Gas Transmission, Northwest
Corporation (downgraded to BB- from BBB+) fell below investment
grade.

PG&E Corporation -- http://www.pgecorp.com-- said it is  
continuing to explore options for the PG&E NEG including sales
of assets and businesses, debt restructuring, and reorganization
of existing operations.


POLAROID: Gets Okay to Hire Barnes Richardson as Trade Attorneys
----------------------------------------------------------------
Pursuant to Sections 327(e), 328 and 329 of the Bankruptcy Code,
Polaroid Corporation and its debtor-affiliates obtained the U.S.
Bankruptcy Court for the District of Delaware's authority to
employ and retain Barnes, Richardson & Colburn as their counsel
for certain customs and international trade matters.

Barnes will be required to render various services in connection
with the representation of the Debtors in customs and
international trade matters including, among others, the
challenges to certain Harbor Maintenance Fees.

The Debtors will pay Barnes as an ordinary course professional
with respect to its being their international trade and customs
counsel.  In connection with the challenges to the Harbor
Maintenance Fees, the Debtors propose to pay Barnes a contingent
fee of 25% of any recovery (Harbor Maintenance Fees plus
interest thereon) in addition to any expenses incurred by
Barnes. (Polaroid Bankruptcy News, Issue No. 25; Bankruptcy
Creditors' Service, Inc., 609/392-0900)

Polaroid Corporation's 11.50% bonds due 2006 (PRDC06USR1) are
trading at 4.5 cents-on-the-dollar, DebtTraders reports. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=PRDC06USR1
for real-time bond pricing.


PORTA SYSTEMS: Fails to Meet AMEX Continued Listing Conditions
--------------------------------------------------------------
Porta Systems Corp., (ASE:PSI) has been notified by the American
Stock Exchange that the exchange will suspend trading in Porta
common stock prior to the opening of trading on October 22, 2002
and will have Porta's common stock delisted from the exchange.

The delisting is based on Porta's previously reported failures
to meet several of the exchange's conditions for continued
listing. Porta also announced that, effective upon the
suspension of trading on the exchange, Porta will seek to have
its common stock traded on the OTC Bulletin Board. Because of
the stock price, Porta's common stock will be subject to the
Securities and Exchange Commission's "penny-stock" rules.

Porta Systems Corp., designs, manufactures, markets and supports
communication equipment used in telecommunications, video and
data networks worldwide.


SEALY CORP: September 1 Equity Deficit Narrows to $124 Million
--------------------------------------------------------------
Sealy Corporation, the world's largest manufacturer of bedding
products, announced results for its third quarter, ended
September 1, 2002.

For the quarter, Sealy reported sales of $313.6 million, a
decrease of 0.9% from $316.4 million for the same period a year
ago.  Adjusted earnings before interest, taxes, depreciation and
amortization (Adjusted EBITDA) were $43.0 million, compared with
$40.2 million a year earlier.  Sealy reported third quarter net
income of $8.4 million, compared with a net loss of $21.7
million a year earlier.  The net loss from last year included a
significant non-cash charge to write off investments in
affiliates.

Reported net sales for the third quarter of 2002 and 2001
reflect Sealy's adoption of Financial Accounting Standards Board
Emerging Issues Task Force 01-09, "Accounting for Consideration
Given by a Vendor to a Customer or a Reseller of the Vendor's
Product."  Under EITF 01-09, cash consideration is a reduction
of revenue, unless specific criteria are met regarding goods or
services that the vendor may receive in return for this
consideration. Historically, Sealy classified costs such as
volume rebates and promotional money as marketing and selling
expenses.  These costs are now classified as a reduction in
revenue.  This had the effect of reducing net sales and selling,
general and administrative (SG&A) expenses each by $17.3 million
for the third quarter of 2002 and by $14.2 million for the third
quarter of 2001.  These changes did not affect the Company's
financial position or results of operations.

Domestic sales volume increased 0.2% reflecting the sluggish
overall economy, while average unit selling price declined 1.7%
as a result of the reclassification of rebates and allowances
under EITF 01-09.  Overall domestic sales declined 1.5%.  
International sales increased 1.8% in the latest quarter.

For the nine months ended September 1, 2002, Sealy reported
sales of $905.1 million, an increase of 7.9% from $839.0 million
a year earlier. Adjusted EBITDA for the nine months ended
September 1, 2002 was $102.8 million, compared with $107.0
million for the same period in 2001.  Year-to- date 2002
Adjusted EBITDA reflects a specific bad debt charge of $19.5
million recognized in the second quarter related to affiliates.  
Net income was $8.4 million, an improvement from the loss of
$16.1 million last year.

At September 1, 2002, the Company's total shareholders' equity
deficit narrowed to about $124 million, from about $133 million,
as recorded at December 2, 2001.

"In spite of the challenging economic environment, we maintained
sales and gross margin before EITF 01-09 adjustments, and
improved Adjusted EBITDA against a strong 2001 third quarter.  
The EITF 01-09 adjustments resulted in a decline of 40 basis
points in gross margin and contributed to a 110 basis point
decline in SG&A," said David J. McIlquham, Sealy's president and
chief executive officer.  "We also completed the rollout of our
new Stearns & Foster product that has been well received by
retailers and consumers," said McIlquham.

Sealy is the largest bedding manufacturer in the world with
sales of over $1 billion in 2001.  The Company manufactures and
markets a broad range of mattresses and foundations under the
Sealy(R), Sealy Posturepedic(R), Sealy Crown Jewel(R), Sealy
Correct Comfort(R), Stearns & Foster(R), and Bassett(R) brands.  
Sealy has the largest market share and highest consumer
awareness of any bedding brand in North America.  Sealy employs
more than 6,000 individuals, has 31 plants, and sells its
products to 3,200 customers with more than 7,400 retail outlets
worldwide.  Sealy is also a leading supplier to the hospitality
industry.  For more information, please visit
http://www.sealy.com  


SECOND CHANCE: Leonard Waldman Steps Down as Company President
--------------------------------------------------------------
Second Chance Corporation (CDNX-SND) announces that its
President, Leonard Waldman, and certain other directors and
officers of the Company have resigned.  Mr. Waldman stated "I
regret that because of current market conditions, the Company's
lack of funds and the fact that a significant number of the
Company's shares continue to be effectively paralysed by the
bankruptcy of Buckingham Securities, I see virtually no prospect
of being able to reactivate the Company."


SOUTHERN UNION: Selling Texas Division to ONEOK for $420 Million
----------------------------------------------------------------
Southern Union Company (NYSE:SUG) has entered into a definitive
agreement with ONEOK, Inc., of Tulsa, Oklahoma, to sell its
Southern Union Gas Company Texas division and related assets to
ONEOK for approximately $420 million in cash.

Southern Union Chairman and Chief Executive Officer George L.
Lindemann stated, "This is an excellent deal for our
shareholders. This transaction represents the first step in our
plan to create value for our shareholders by strengthening our
balance sheet and by providing sufficient liquidity to explore
investments in other energy-related opportunities."

Southern Union Gas Company is Southern Union's oldest natural
gas distribution operating division. Headquartered in Austin, it
serves approximately 535,000 customers, including the cities of
Austin, El Paso, Brownsville, Galveston and Port Arthur. Related
assets being sold to ONEOK include SUPro Energy Company,
Southern Transmission Company, Mercado Gas Services, Inc., and
the Company's natural gas distribution investments in Mexico.
ONEOK is a diversified energy company that distributes natural
gas to approximately 1.4 million customers in Kansas and
Oklahoma.

The transaction, which has been approved by the boards of
directors of both companies, will close as soon as possible
following clearance by the Federal Trade Commission under the
Hart-Scott-Rodino Act and approval by certain Texas
municipalities.

J.P. Morgan Securities Inc., acted as financial advisor to
Southern Union Company on this transaction. Southern Union
Company is an energy distribution company serving nearly 1.5
million customers through its natural gas operating divisions in
Texas, Missouri, Pennsylvania, Rhode Island, Massachusetts and
Mexico. For more information, visit
http://www.southernunionco.com  

In its June 30, 2002 balance sheets, Southern Union Company
recorded that its total current liabilities eclipsed its total
current assets by about $186 million.


TAYLOR CAPITAL: Fitch Plucks Lowered Ratings from Watch Negative
----------------------------------------------------------------
Fitch Ratings has downgraded the ratings of Taylor Capital Group
and has removed the company from Rating Watch Negative. At the
same time Fitch has affirmed the ratings of TCG's main operating
subsidiary Cole Taylor Bank. Fitch's action is taken in
conjunction with TCG's final settlement of longstanding
litigation and an initial public offering related to that
settlement. In addition, Fitch has assigned new ratings to TAYC
Capital Trust I, an entity established to issue capital
securities.

TCG will resolve litigation related to former affiliate Reliance
Acceptance Group by issuing roughly $37 million of common stock
and $43 million in capital securities. From the total proceeds,
roughly $64.5 million will be paid to the litigants. The balance
will be used to reduce external bank debt. Although the
resolution of this issue is advantageous to TCG and Cole Taylor,
a major negative side effect is the resultant significant
reduction in common equity and the weakening of the capital
structure.

In order to recognize the less robust capital structure, Fitch
has lowered TCG's long-term and individual ratings. The
settlement, while removing a major uncertainty from the
company's prospects, considerably increases the holding
company's interest burden. Although management has been able to
raise some new sources of capital, the transaction is still
dilutive to capital ratios.

However, raising new capital has relieved some of the potential
pressure on Cole Taylor Bank's ratings. The consolidated company
will have a stronger capital base, meeting the regulatory
definition of a well-capitalized company. Fitch believes that
this makes it less likely that Cole Taylor will be required to
support its parent. Accordingly, Cole Taylor Bank's long-term
rating will remain at BBB-,' its Individual Rating will remain
at 'B/C' and its short-term rating at 'F3'.

Junior instruments, such as preferred stock and trust preferred
securities, will play a significant role in TCG's capital
structure. Fitch would normally rate such instruments one notch
below senior debt. However, in light of the degree of reliance
on these instruments to provide a capital cushion, Fitch has
placed the rating for these instruments at two notches below
holding company senior.

Investors should note that the settlement of this difficult
issue has some major long-term positive implications for TCG.
The resolution of this issue eliminates a large distraction from
management's agenda, allowing the company to devote more
resources to strategic issues. Management is in fact refining
its strategic focus to concentrate on lending to small and
middle market businesses. This market segment has long been one
of the strengths of TCG's franchise, and Fitch views this
renewed focus positively.

                    Ratings Lowered and Removed
         From Rating Watch Negative, Rating Outlook Stable:

                       Taylor Capital Group

    --Long-term Senior Debt from 'BBB-' to 'BB+';
    --Individual Rating from 'B/C' to 'C';
    --Preferred Stock from 'BB+' to 'BB-';

                   Ratings Affirmed and Removed
         From Rating Watch Negative, Rating Outlook Stable:

                      Taylor Capital Group

    --Support '5'.

                        Cole Taylor Bank

    --Long-term Senior Debt 'BBB-';
    --Long-term Deposits 'BBB';
    --Short-term Deposits 'F2';
    --Short-term senior debt 'F3';
    --Individual Rating 'B/C';
    --Support '5'.

              New Rating Assigned, Rating Outlook Stable:

                        TAYC Capital Trust I

    --Trust Preferred Securities 'BB-'.


TELAXIS COMMS: Fails to Maintain Nasdaq Listing Requirements
------------------------------------------------------------
Telaxis Communications Corporation (Nasdaq:TLXS), a developer of
wireless fiber optic connectivity products, recently received a
NASDAQ Staff Determination indicating that Telaxis fails to
comply with the minimum $1.00 bid price requirement for
continued listing set forth in NASDAQ Marketplace Rule
4450(a)(5) and that its securities are therefore subject to
delisting from the NASDAQ National Market at the opening of
business on October 18, 2002.

Telaxis has requested a hearing before a NASDAQ Listing
Qualifications Panel to review the Staff Determination. This
request stays the delisting. There can be no assurance that the
Panel will grant Telaxis' request for continued listing.

Telaxis is developing its FiberLeap(TM) product family to enable
direct fiber optic connection to wireless access units and to
transparently transmit fiber optic signals over a wireless link
without the use of conventional modems. Taking advantage of
Telaxis' high-frequency millimeter-wave expertise, the
FiberLeap(TM) product family is being developed to use the large
amounts of unallocated spectrum above 40 GHz to provide data
rates of OC-3 (155 Mbps), OC-12 (622 Mbps), and Gigabit
Ethernet. Telaxis has recently demonstrated its initial
EtherLeap(TM) product, an 802.11-based Ethernet Local Area
Network (LAN) radio operating at millimeter-wave frequencies.
For more information about Telaxis, please visit its Web site at
http://www.tlxs.comor contact the company by telephone at 413-
665-8551 or by email at IR@tlxs.com.


TELESOFT CORP: Will Commence OTCBB Trading Effective October 24
---------------------------------------------------------------
Telesoft Corp., (Nasdaq:TSFT) received a Nasdaq Staff
Determination today indicating that Telesoft has failed to
comply with the market value of public float requirement for
continued listing set forth in Nasdaq Marketplace Rule
4310(c)(7), and that its common stock will be delisted from The
Nasdaq SmallCap Market at the opening of business on Oct. 24,
2002. Telesoft does not plan to request a hearing before a
Nasdaq Listing Qualifications Panel to review the Nasdaq Staff
Determination.

Telesoft expects its common stock to begin trading on the OTC
bulletin board on Oct. 24, 2002 under the symbol TSFT.

Michael Zerbib, CEO of Telesoft, commented, "The Nasdaq
delisting has no bearing on the fundamentals of our business.
Our stock repurchase program over the last three years,
including our `Dutch auction' self-tender offer in 2000, has
reduced the company's outstanding public float and has made it
more challenging for the company to comply with the Nasdaq
requirements. In addition, in light of the general concerns
about corporate governance, it is becoming increasingly
difficult for us to attract and retain a majority of independent
directors for our audit committee, as required by Nasdaq."

Telesoft Corp., provides billing and customer care solutions to
educational institutions, corporations and government agencies.


TENFOLD CORP: Initiates Restructuring of US-Based Operations
------------------------------------------------------------
TenFold Corporation (Nasdaq: TENF), provider of the Universal
Application(TM) and large-scale applications, announced the
restructuring, including significant layoffs, of its US-based
operations as a result of the continued unprecedented slowdown
in technology purchases.

"We have a talented, best-in-class workforce and we are
disappointed to be taking this action," said Nancy Harvey,
president and CEO of TenFold Corporation.  "Nonetheless, with
the continued uncertainty in the market, we are compelled to
take prudent steps designed to conserve cash to help enable
TenFold to weather the coming months."

"Our highest priority remains continuing to provide quality
service and technology to our development and production
customers, and we have focused our resources around those
customers and their needs," said Jeanne Marie Kiss, Senior Vice
President of Operations of TenFold Corporation.

TenFold Corporation (NasdaqSC: TENF) is a provider of the
Universal Application(TM), an applications development platform,
and large-scale applications for customers in communications,
energy, financial services, healthcare, insurance, and other
industries.  Using its patented Universal Application, TenFold
delivers dynamic packaged applications that meet customers'
needs in rapidly changing business environments, and that are
flexible to adapt to changing needs over time.  For more
information, call (800) TENFOLD or visit http://www.10fold.com  

At June 30, 2002, TenFold's balance sheets show a total
shareholders' equity deficit of about $30 million.


TRANSTECHNOLOGY: Posts Improved Operating Performance for Q2
------------------------------------------------------------
TransTechnology Corporation (NYSE:TT) reported a loss from
continuing operations of $1.3 million for the second fiscal
quarter ended September 29, 2002 compared to a loss from
continuing operations of $1.3 million for the same period one
year ago.

The current quarter's results included a $1.2 million after-tax
non-cash charge associated with an amendment to the company's
subordinated notes and a related change in the value of warrants
to purchase the company's stock during the quarter.

Net sales for the second quarter of fiscal 2003 increased 6% to
$17.3 million from $16.3 million in the same quarter a year ago.
Including a loss from discontinued operations of $4 million, the
company reported a net loss for the second quarter of fiscal
2003 of $5.2 million. For the same period last year the company
reported a net loss of $54.6 million including a loss from
discontinued operations of $53.3 million.

The company reported operating earnings before interest and
taxes of $3.3 million for the quarter, up 76% compared to $1.9
million in last year's second quarter, after adjusting for last
year's second quarter charges for forbearance fees and corporate
office restructuring costs. Operating earnings before interest,
taxes, depreciation and amortization (EBITDA) rose 39% from last
year's second quarter level, and free cash flow, or net income
after cash taxes plus depreciation, amortization and non-cash
mark-to-market adjustments less capital expenditures, rose to
$113 thousand, compared to negative free cash flow of $1.8
million in last year's second quarter.

The company reported that the loss from discontinued operations
in the current quarter included operating income from
discontinued businesses of $416,000; allocated interest expense
of $507,000; an $895,000 non-cash charge to recognize increased
loss reserves associated with units previously divested; and the
recognition of accumulated currency translation losses
associated with the sale of the company's Brazilian operation of
$4.9 million, which were offset by a tax benefit of $1.9
million. The loss from discontinued operations reported for the
second quarter of fiscal 2002 included the gain realized on the
sale of the hose clamp business in July 2001, the anticipated
loss on the sale of the engineered components business which was
pending at the end of that quarter but closed in the third
quarter, increases in the losses anticipated upon the sale of
the various retaining rings businesses (the last of which were
sold in the second quarter of fiscal 2003), the forecasted
operating income and interest expense associated with the
industrial products segment through the anticipated closing
dates of the divestitures of those units, and the accrual of
certain phase out costs through the completion of the
restructuring process.

For the six months ended September 29, 2002, the company
reported a loss from continuing operations of $838 thousand,
compared to a loss of $1.2 million in the prior year's six month
period. For the first half of fiscal 2003 the company reported a
loss from discontinued operations of $5.1 million. For the same
period of the prior year the company reported a loss from
discontinued operations of $52.6 million. The net loss for the
six months ended September 29, 2002 was $6.0 million, compared
to a net loss of $53.8 million in the prior year's six month
period. Sales for the first six months of fiscal 2003 were $37.2
million compared to $34.9 million in the prior year's same
period, an increase of 6.6%.

               Military Sales Continue To Drive Growth

Both of the company's aerospace businesses reported stronger
operating profits during the second quarter of fiscal 2003 than
in the prior year's second quarter. A favorable mix of repair
and overhaul business to new equipment deliveries resulted in
strong operating profit growth at Breeze Eastern on a 17% sales
increase, while Norco reported an 11% gain in operating income
for the quarter on an 11% sales decrease. The sales decrease at
Norco had been anticipated as the result of lower commercial
airframe OEM orders that were caused by the decline in
commercial aircraft production. The decline in the commercial
OEM sector was offset, however, by an increase in military spare
parts orders. Norco sales of products to airlines and into the
aftermarket remained constant with last year's second quarter
levels. Norco's profitability was increased in the face of this
sales decline as a result of the higher margins carried by
aftermarket sales, both military and commercial, and the rapid
implementation of a cost reduction program in the business.
Breeze-Eastern has not been and is not expected to be impacted
by the slowdown in the commercial airframe industry, as all of
its sales are to the US or foreign military or government
agencies. The company's backlog at the end of the second quarter
remained flat to that at the end of the first quarter at $47
million, although it was up 3% for the first half of the fiscal
year.

Michael J. Berthelot, Chairman and Chief Executive Officer of
the company, said, "Our aerospace defense business had a very
good second quarter, with both units performing at or above our
operating targets. The second quarter results were heavily
influenced by the leveraged state of our balance sheet and the
high interest rates we are currently paying, with our interest
expense allocated to continuing operations up $1.3 million, or
$.13 per share, from last year's second quarter, even though
total interest paid was reduced by $3 million from last year's
second quarter. While our corporate office expenses increased
during the current year's second quarter from last year's level,
this increase was due to the payment of incentive compensation
during the quarter ($400 thousand) and the amortization of fees
and costs associated with the refinancing of our senior debt and
the amendment of our subordinated debt ($800 thousand). At the
end of September, our weekly corporate office expenses were down
to our annual forecasted run rate of $4.1 million, excluding the
amortization of these various financing fees."

"The outlook for the future of our aerospace business remains
strong", Mr. Berthelot continued, "We expect that increased
military spending, especially on aftermarket parts, and the
higher margins we realize on aftermarket sales to both
commercial and military users, will offset most, if not all, of
the possible lost commercial airframe OEM revenues. Our second
half revenues and profitability will be heavily influenced by
the mix of this aftermarket business as well as the commencement
of shipping the HLU-196 Bomb Hoist for the U.S. Navy, for which
we currently have over $12 million of booked orders. "

           Restructuring Process Essentially Completed

The company reported that during the second quarter it had
substantially completed its restructuring program, begun in
fiscal 2001. With the second quarter sales of the UK and
Brazilian retaining ring businesses, the refinancing of the
company's senior debt, and the amendment of its subordinated
debt, the company ended its operation under forbearance
agreements with its senior and subordinated lenders. The company
completed the relocation of its corporate office into its
Breeze-Eastern facility in July, 2002, and it has downsized to 9
people from its earlier level of 24. At the end of the second
quarter, the company had one remaining operation included in
discontinued operations and assets held for sale. That
operation, TCR Corporation, a Minneapolis manufacturer of
specialty screw machine and cold-headed products, is currently
being marketed for sale by Goldsmith, Agio & Helms. The company
hopes to complete its divestiture before the end of the current
fiscal year.

With regard to the current quarter's charge from the warrant
amendment, Joseph F. Spanier; Vice President and Chief Financial
Officer, said, "In association with the refinancing of our
senior debt, we amended the subordinated debt agreement and the
associated warrants. Under the terms of that amendment, if the
warrants remain outstanding on December 31, 2002, the exercise
price of the warrants drops to $.01 per share from the stated
value of $9.9375 per share. After reviewing these factors with
our auditors, Deloitte & Touche, we determined that, under GAAP,
this amendment constitutes a derivative financial instrument. As
such, it results in a reduction to our equity of $4.5 million,
the value of the warrants at $.01 measured against our stock
price on the amendment date, and the establishment of a long-
term liability of the same amount, effective with the date of
the amendment, August 7. By the end of the second quarter, our
share price had risen to $13.46 compared to $10.64 on August
7th, which resulted in a "mark-to-market" charge to our
operating results of $1.2 million. Until the provisions of the
amended warrants that provide their holders the ability to "put"
the warrants to the company for $5 per share are extinguished,
at the end of each subsequent quarter, we will recognize income
or loss based upon changes in the company's common stock price.
Upon the termination of the put rights, the original amount of
the liability and the adjustment to paid in capital as increased
or decreased by the amounts of any income or expense recognized
from the quarterly mark-to- market adjustments, will be reversed
out of both the liability and equity portions of our balance
sheet. The long-term economic impact of the warrant amendment is
that, if the sub-debt is not retired and the warrants redeemed
by December 31, the company will have 427,602 additional shares
outstanding in computing earnings per share, a dilution factor
of approximately 7%. The maximum cash exposure of the company
related to these warrants and their put rights, if any, is the
$2.1 million that would be required to redeem the warrants or
the underlying shares in the event there were a sale of the
entire company or either of our aerospace units. Exercising the
put rights under those circumstances would only be economically
feasible to the holders of the warrants if the share price were
$5 or less. There is no cash exposure to the company whatsoever
from the liability established or the operating charge
recognized during this quarter, rather, those items are shown
purely as the accounting requirement to report them in this
fashion."

Mr. Berthelot stated "We are nearing the end of our analyses of
how to address the final restructuring issues of our balance
sheet, which, as it currently sits, is too highly leveraged. We
are also completing the evaluation of a number of strategic
alternatives relative to the maximization of shareholder value.
Our advisors, Quarterdeck Investment Partners LLC and Friedman,
Billings, Ramsey & Co., Inc., are finalizing their activities
and we expect our Board to reach a conclusion and begin to
implement a course of action during this fiscal quarter."

TransTechnology Corporation is the world's leading designer and
manufacturer of sophisticated lifting devices for military and
civilian aircraft, including rescue hoist, cargo hooks, and
weapons-lifting systems, as well as aircraft engine nacelle
hold-open rods. The company, which employs over 280 people at
its facilities in New Jersey and Connecticut, reported sales of
$72.3 million in the fiscal year ended March 31, 2002.


UNITED AIRLINES: Third Results Coming Today; Chapter 11 Possible
----------------------------------------------------------------
United Airlines (NYSE: UAL) will release its third-quarter
financial results as scheduled on Friday, October 18.  The
previously announced conference calls for analysts and members
of the press, however, will be scheduled for a time in the near
future when the company will be able to discuss greater details
of its financial recovery plan, which is the matter of greatest
interest for call participants.

United continues its vigorous pursuit of solutions to its
current financial crisis on a number of important fronts.  As it
pursues these remedies, the company's first priority continues
to be accomplishing a restructuring outside of the bankruptcy
courts, although, United says, "a Chapter 11 filing can't be
ruled out."

     -- The company has held discussions about labor cost
savings with the United Airlines Union Coalition and also, as
planned, with Coalition members individually.  These meetings
have continued throughout the week.

     -- In addition, United is engaged in discussions with
lenders, suppliers and others to secure short- and long-term
sources of capital.

     -- Furthermore, a company task force is making significant
progress in identifying new sources of revenue and non-labor
expense reductions.

United intends to file an updated business plan soon with the
Air Transportation Stabilization Board that makes a compelling
case for federal loan guarantees as well as for the company's
ability to return to financial health and profitability.  This
process is progressing rapidly and United is moving quickly to
finalize the structure and content of this plan.


U.S. STEEL: Signs Pact to Sell Businesses to Transtar for $500MM
----------------------------------------------------------------    
United States Steel Corporation (NYSE: X) has signed a letter of
intent to sell its Clairton, Pennsylvania, and Gary, Indiana,
coke operations, its Minnesota iron ore operations, and its
wholly owned transportation services subsidiary Transtar, Inc.,
to an entity formed by affiliates of Apollo Management, L.P. of
New York City.

The transaction is subject to the negotiation of definitive
agreements and other customary conditions, including approvals
from the board of directors, lenders and regulatory agencies.
The parties plan to reach definitive agreements by year-end 2002
with closing expected to follow in the first quarter of 2003.

Under terms of the letter of intent, it is anticipated that U.
S. Steel would receive approximately $500 million in cash and
retain about a 20 percent interest in the new company, with the
new company assuming all collective bargaining agreements,
certain employee benefit obligations and certain other
liabilities. U. S. Steel currently estimates the transaction
could result in a pre-tax loss of up to $300 million.

The new company and U. S. Steel plan to enter into long-term
contracts to supply U. S. Steel with its domestic iron ore and
coke requirements and to provide U. S. Steel with transportation
services.

U. S. Steel Chairman, CEO and President Thomas J. Usher said,
"This sale would enable us to redeploy capital to other
potential uses such as strategic acquisition opportunities, debt
reduction, or voluntary contributions to employee benefit
plans."

He added, "This would be an important step in our strategy to
focus on growing our higher value-added domestic operations and
to continue to expand globally. At the same time, we would
secure a stable, long-term supply of our critical raw material
requirements at market-based prices and preserve the vital
transportation services provided through Transtar.

"We believe the sale of these assets would be in the best
interests of all of our stakeholders. We are also pleased to
participate as a minority equity owner with Apollo in the growth
of these excellent businesses in the years ahead."

Charles C. (Chuck) Gedeon, currently executive vice president-
raw materials for U. S. Steel, would leave U. S. Steel to lead
the new company. Gedeon, who started in the steel industry as a
laborer, has more than 40 years of experience covering virtually
every aspect of the steelmaking process. He has been responsible
for the raw materials operations since he joined U. S. Steel in
1986. Operating managers and employees of Clairton Works, Gary
Coke, Minntac and Transtar would also join the new company.

Josh Harris, a founding partner of Apollo, said, "We are
extremely pleased to be partnering with the domestic industry's
premier steel producer and excited about the growth prospects
for the new company. The leadership of Chuck Gedeon, the
experienced management team and the corps of dedicated employees
at these facilities are a strong formula for success."

Apollo, formed in 1990, is a private equity fund based in New
York.  Since its inception, Apollo and its affiliates have
managed the investment of over $13 billion in capital in a wide
variety of industries.

Clairton Works and Gary Coke operations are both ISO 14001
certified and are leaders in environmental stewardship. Clairton
Works employs about 1,500 people and is the country's largest
coke producer, with an annual capacity of 4.6 million net tons.
Gary Coke operations, with approximately 550 employees, has an
annual capacity of 2.1 million net tons.

Minntac, U. S. Steel's taconite mining operations in Mt. Iron,
Minn., mines iron-bearing taconite and converts it into high-
iron content pellets in a process called beneficiation. With an
annual production capacity of 16.4 million net tons, Minntac is
the largest producer of taconite pellets in North America and
employs about 1,550 people. At the end of 2001, U. S. Steel had
695 million net tons of iron ore reserves, all of which were and
would continue to be assigned to Minntac.

Transtar owns several rail lines, a barge line and a number of
transportation-related entities and has approximately 1,700
employees. All of Transtar's direct and indirect operating
subsidiaries would be included in the proposed transaction,
except Transtar Logistics, LLC, which provides transportation
management services to U. S. Steel and third parties. The
operations to be sold include the Birmingham Southern Railroad
Company and its subsidiary Fairfield Southern Company, Inc.; the
Elgin, Joliet and Eastern Railway Company; the Lake Terminal
Railroad Company; the McKeesport Connecting Railroad Company;
the Union Railroad Company; the Warrior & Gulf Navigation
Company and its subsidiary, the Mobile River Terminal Company,
Inc.; and Tracks, Traffic and Management Services, Inc.
    
For more information about U. S. Steel visit
http://www.ussteel.com

                           *   *   *

As reported in the August 12, 2002 edition of the Troubled
Company Reporter, Fitch Ratings affirmed the senior unsecured
long-term ratings of U.S. Steel at 'BB' and assigned a 'BB+'
rating to the company's senior secured revolver. The Rating
Outlook is Stable.


VION PHARMACEUTICALS: Will Appeal Nasdaq Delisting Notification
---------------------------------------------------------------
Vion Pharmaceuticals, Inc., (Nasdaq: VION) will appeal Nasdaq's
determination to delist Vion's common stock from The Nasdaq
National Market by requesting a hearing before a Nasdaq Listing
Qualifications Panel.

The delisting proceedings will be stayed and the Company's
common stock will continue to be listed on The Nasdaq National
Market pending resolution of this appeal.  There can be no
assurance that the Panel will grant the Company's request for
continued listing on The National Market.

Vion received notification from Nasdaq on October 15, 2002 that
the Company's common stock will be delisted from The Nasdaq
National Market because the Company did not comply with Nasdaq's
minimum bid price requirements.  Specifically, Vion did not
comply with Marketplace Rule 4450(a)(5) when the bid price of
the Company's common stock closed at less than $1.00 per share
for 30 consecutive trading days.  After receiving initial
notification from Nasdaq on July 14, 2002, the Company was not
able to regain compliance in accordance with Marketplace Rule
4450(e)(2) during the 90-day period ending October 14, 2002.

If Vion's appeal is unsuccessful, the Company intends to apply
to transfer its common stock to The Nasdaq SmallCap Market.  
Although there can be no assurances that it will do so, if
Nasdaq approves the transfer to the SmallCap Market, shares of
Vion common stock would continue to be listed under their
existing ticker symbol, VION.  As with The Nasdaq National
Market, the SmallCap Market requires listed companies to have a
minimum closing bid price of $1.00 per share.  On the SmallCap
Market, however, Vion would be eligible for an additional grace
period ending January 13, 2003, to achieve compliance with the
minimum closing bid requirements.

The Company may also be eligible for an additional 180-day grace
period beyond that initial SmallCap Market 90-day period, if it
complies with the initial listing requirements of The SmallCap
Market.  If Vion is successful in qualifying for the additional
180-day grace period, the Company will have until July 10, 2003
to achieve compliance with the minimum closing bid price
requirements.  If during these SmallCap grace periods, the
closing bid price of Vion's common stock is $1.00 per share or
more for 30 consecutive trading days, the Company will have
regained compliance with Nasdaq's minimum bid price requirements
and may also be eligible to transfer its common stock back to
The Nasdaq National Market, provided that the Company has
maintained compliance with other continued listing requirements
on that market.

Vion Pharmaceuticals, Inc., is a biotechnology company
developing novel agents for the treatment of cancer.  Vion's
portfolio of agents includes: Triapine(R), a potent inhibitor of
a key step in DNA synthesis and repair; VNP40101M, a unique DNA
alkylating agent; and TAPET(R), a modified Salmonella vector
used to deliver anticancer agents directly to tumors. For
additional information on Vion and its product development
programs, visit the company's Internet Web site at
http://www.vionpharm.com


WILLIAMS COMMS: Leucadia Acquires 44% Equity Stake in WilTel
------------------------------------------------------------
Leucadia National Corporation (NYSE and PCX:LUK) has acquired
44% of the outstanding equity of WilTel Communications Group,
Inc., a newly formed Nevada corporation that emerged today from
the chapter 11 bankruptcy proceedings of Williams Communications
Group, Inc.  The aggregate purchase price of $330 million, in
the form of irrevocable letters of credit, has been deposited
into escrow pending receipt of requisite regulatory approval
from the Federal Communications Commission.

The WilTel stock was acquired by Leucadia under Old WCG's
chapter 11 Restructuring Plan pursuant to a claims purchase
agreement with The Williams Companies, Inc. and an investment
agreement with Old WCG. The Plan, which became effective on
October 15, 2002, was consummated under special temporary
authority granted by the FCC. WilTel expects requisite approvals
will be received from the FCC prior to the end of this year; at
such time the purchase price will be released from escrow. Upon
receipt of requisite approvals from the FCC, Leucadia will
account for this investment under the equity method of
accounting.

Leucadia has appointed four members (including Ian M. Cumming
and Joseph S. Steinberg, Leucadia's Chairman and President,
respectively) to the newly constituted board of directors of
WilTel and has entered into a stockholders agreement with WilTel
pursuant to which Leucadia has agreed to certain restrictions on
its ability to acquire or sell WilTel stock.

Leucadia National Corporation is a holding company engaged in a
variety of businesses, including banking and lending
(principally through American Investment Bank, N.A.),
manufacturing (through its Plastics Division), winery
operations, real estate activities, development of a copper mine
(through its 72.8% interest in MK Gold Company) and property and
casualty insurance and reinsurance. The Company also currently
has equity interests of more than 5% in the following domestic
public companies: AmeriKing, Inc. (6.8%), Carmike Cinemas, Inc.
(11.1%), GFSI Holdings, Inc. (6.9%), Jackson Products, Inc.
(8.8%) and Jordan Industries, Inc. (10.1%).


WORLDCOM INC: Asks Court to Okay Proposed Asset Sale Procedures
---------------------------------------------------------------
Marcia L. Goldstein, Esq., at Weil Gotshal & Manges LLP, in New
York, tells the Court that prior to the Petition Date, Worldcom
Inc., and its debtor-affiliates frequently sold assets no longer
useful in the operation of their businesses, including real
property, excess, broken, decommissioned and obsolete fixtures
and equipment, and other personal property and interests in
property obtained by the Debtors in connection with business
combinations and corporate acquisitions.  The Debtors have an
experienced internal department that is devoted entirely to
asset dispositions.  This department works closely on asset
dispositions with consultants from Lazard FrSres & Co. LLC and
JA&A Services, LLC, both of which are highly experienced in
bankruptcy sales.

In order to maximize value and to avoid the unnecessary costs
and delays to the estates of seeking Court authorization for
each proposed sale, the Debtors seek the Court's authority to
continue selling property or interests in property, in
accordance with prior practice and with oversight from Court-
approved consultants, without the need to obtain further Court
approval.

The Debtors propose the implementation of these procedures for
the sale of property or interests in property having a sale
price of not more than $10,000,000:

A. If the sale price is less than $1,000,000, the Debtors will
   be authorized to sell the property without further notice or
   further order of the Court;

B. If the sale price is from $1,000,000 to $10,000,000:

   -- The Debtors will give notice via e-mail, facsimile, or
      overnight delivery service of each proposed sale to the
      attorneys for Creditors' Committee, the United States
      Trustee, and their postpetition lenders.  The notice
      will specify the assets to be sold, the identity of the
      purchaser, and the sale price;

   -- The Notice Parties will have five business days from the
      date on which the Sale Notice is sent to object to, or
      request additional time to evaluate, the proposed
      transaction.  Any objection or request should be in
      writing and delivered to the Debtors' counsel, Weil,
      Gotshal & Manges LLP.  If no written objection or written
      request for additional time is received by Debtors'
      counsel prior to the expiration of the five-day period,
      the Debtors will be authorized to consummate the proposed
      sale transaction and to take any action reasonable or
      necessary to close the transaction and obtain the sale
      proceeds.  If any Notice Party timely provides a written
      request to the Debtors' counsel for additional time to
      evaluate the proposed transaction, the Notice Party will
      have an additional 10 calendar days to object to the
      proposed transaction.  The Debtors may consummate a
      proposed sale promptly upon obtaining approval of the
      Notice Parties;

   -- If any Notice Party delivers an objection to the proposed
      transaction so that it is received by Debtors' counsel on
      or before the fifth business day after the Sale Notice is
      sent, the Debtors and the objecting Notice Party will use
      good faith efforts to resolve the objection.  If the
      Debtors and the objecting Notice Party are unable to
      achieve a consensual resolution, the Debtors will not
      proceed with the proposed transaction pursuant to these
      procedures, but may seek Court approval of the proposed
      transaction upon expedited notice and a hearing, subject
      to the Court's availability; and

   -- Nothing in these procedures will prevent the Debtors, in
      their sole discretion, from seeking the Court's approval
      at any time of any proposed transaction upon notice and a
      hearing;

C. If the sale price is greater than $10,000,000, the Debtors
   will be required to file a motion with the Court requesting
   approval of the sale pursuant to Section 363 of the
   Bankruptcy Code; and

D. The Debtors will file with the Court, on a quarterly basis,
   reports of all sales with a sale price greater than
   $1,000,000 during the quarter pursuant to the authority
   requested in this motion.  The reports will set forth a
   description of the property, the name of the purchaser and
   the sale price.

The Debtors believe that the sales of these assets in the manner
proposed constitute the most efficient and cost-effective means
of maximizing the value to be realized.  Obtaining Court
approval for each sale transaction would result in unnecessary
administrative costs attendant to drafting, serving and filing
pleadings, as well as time incurred by attorneys for appearing
at Court hearings, which could drastically reduce the ultimate
net value of these assets.  The Debtors believe the proceeds
generated by many of the sales transactions do not warrant the
incurrence of these expenses.

Ms. Goldstein assures the Court that the Debtors and their
advisors have significant experience with these sales and are
very well versed in obtaining the best sale price possible.
Moreover, the Debtors often face stringent time constraints in
meeting the closing deadlines established by interested
purchasers and in selling the assets before there is a
significant decline in value.  The expedited procedures will
permit the Debtors to be responsive to the needs of interested
purchasers, thereby guarding against lost sales due to delay,
while still providing for a review of the proposed transaction
by the Notice Parties.

While the Debtors seek authorization to sell assets for a
purchase price up to $10,000,000, the Debtors believe that many
individual transactions will, in fact, be for substantially
less.  Ms. Goldstein contends that the proposed sale price
limitations are de minimis and appropriate in view of the
circumstances and size of the Debtors' estates.  The estates are
further protected by the opportunity for the Creditors'
Committee, the U.S. Trustee and the Debtors' postpetition
lenders to review and object to any proposed transaction.

The Debtors are unaware of any liens against the property to be
sold pursuant to this motion, other than those held by their
postpetition lenders.  In order to facilitate the proposed sale
transactions, the Debtors further ask the Court to authorize the
sales of property pursuant to this motion to be free and clear
of any and all liens, claims and encumbrances with any Liens to
be, at the Debtors' discretion, either:

-- satisfied from the proceeds of the sale, or

-- transferred and attached to the net sale proceeds. (Worldcom
   Bankruptcy News, Issue No. 10; Bankruptcy Creditors' Service,
   Inc., 609/392-0900)   

Worldcom Inc.'s 8.0% bonds due 2006 (WCOM06USN1), DebtTraders
reports, are trading at 13 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=WCOM06USN1
for real-time bond pricing.


W.R. GRACE: Asbestos Claimants Want a Trustee Appointed
-------------------------------------------------------
The Official Committee of Asbestos Personal Injury Claimants
tells Judge Wolin that there is only one way to ensure that a
proper representative of W.R. Grace's chapter 11 estates is
empowered to prosecute avoidance actions under 11 U.S.C. Sec.
544(b) against Sealed Air Corporation, unwind that spin-off
transaction and recover value for the benefit of W.R. Grace's
estate and its creditors.  That solution, the Committee says, is
to appoint a Chapter 11 Trustee.  

The Committee stresses the potential value of Grace's claims and
causes of action against Sealed Air: $3.8 billion -- more than
the value of all assets listed on Grace's balance sheet today.  

Nathan D. Finch, Esq., at Caplin & Drysdale, Chartered,
representing the Committee, tells Judge Wolin that W.R. Grace
has already made it clear that it won't prosecute the Sealed Air
claims.  Grace contends that it was solvent at the time of the
Sealed Air Transaction and that fact defeats any fraudulent
conveyance claim.  In a pleading filed with the Court on June
20, 2002, the Debtors went so far as to say they "den[y] that
the claims have any merit."  Grace isn't troubled at all that it
gave away its $5 billion Packaging Business in 1998 and only got
$1.2 billion in return, the Committee complains.  And, to the
creditors' detriment, Grace has made it clear it won't pursue
recovery on account of the Sealed Air Transaction.  

The Third Circuit Court of Appeals' Cybergenics decision now
calls the Committee's ability to prosecute the claims into
question.  The Committee thinks an Examiner appointed under 11
U.S.C. Sec. 1106 could probably litigate the claims, but
additional legal research calls that into question.  A chapter
11 trustee, appointed under 11 U.S.C. Sec. 1104, the Committee
concludes, is the one person who could step into the Debtors'
shoes to litigate without dispute.

To establish cause for appointment of a Chapter 11 Trustee, the
Committee points to:

     * Grace's "strange position" in the Sealed Air litigation
       seeking to defeat claims that would greatly benefit the
       estates;

     * Grace supporting Sealed Air's arguments in various
       motions before the Court;

     * Grace instructing its employees and agents not to answer
       certain questions and objecting to other questions during
       Grace Employee depositions the Committee's taken from
       time-to-time;

     * Grace's refusal to produce relevant documents the
       Committee wants to put their fingers on;

     * Grace's uncooperativeness causing the Special Master to
       issue 14 separate discovery orders; and

     * Grace taking the lead role in deposing the Asbestos
       Claimants' Committee's personal injury claims estimation
       expert.  

Failure to appoint a Chapter 11 Trustee, the Committee contends,
will be clearly adverse to the interests of Grace's creditors
and other parties-in-interest.  Failing to appoint a Trustee
given the Cybergenics problem and the enormous value of the
claims would be unquestionably wrong, the Committee warns Judge
Wolin, would constitute an abuse of the Court's discretion.  

Although there's a general presumption against appointing a
trustee because the debtor-in-possession is a fiduciary of the
creditors and, as a result, has an obligation to refrain from
acting in a manner which could damage the estate, or hinder a
successful reorganization, the Committee argues, that
presumption fails where the Debtor takes steps to undermine the
value of the estate to its creditors.  The Committee directs
Judge Wolin's attention to the Third Circuit's teaching on this
point in In re Marvel Entertainment, 140 F.3d 463, 471, 478 (3d
Cir. 1998) (citing Petit v. New England Mort. Servs., 182 B.R.
64, 69 (D. Me. 1995).  In Marvel, the Third Circuit upheld the
District Court's appointment of a Trustee where (1) acrimony
between the debtor and its creditors rose to the level of
"cause" under Sec. 1104 and (2) appointment of a Trustee was
found to be in the best interests of the parties and estate).  
The Committee also points Judge Wolin to In re Sharon Steel
Corp., 871 F.2d 1217, 1228 (3d Cir. 1989) (holding that
appointment of a trustee was appropriate where the debtor
engages in pre-bankruptcy systematic siphoning of assets to
other companies under common control).  

                              *   *  *

In the event that Judge Wolin grants the Committee's request for
a Chapter 11 Trustee, the Court and other core parties-in-
interest are not oblivious to the result:

     * the DIP Financing Facility would go into immediate
       default;

     * covenants under other debt instruments may be breached as
       well;

     * most of Grace's Top Management Employment Contracts would
       trigger constructive discharge provisions;

     * a trustee would be faced with the same potential conflict
       the Debtors face -- arguing the same set of facts two
       different ways to prove solvency for one purpose and
       disprove it for another purpose;  

     * Kirkland & Ellis would probably lose a client ("I take it
       that if I were to appoint a trustee, that's sayonara to
       Kirkland & Ellis representing W.R. Grace," Judge Wolin
       queried at a recent status conference?  "I don't know.  
       The thought has not crossed my mind.  God bless, I'm very
       busy with a lot of matters," David Bernick, Esq.,
       responded.);  

     * delay, a new layer of professionals, a likely neutered
       board of directors, and, potentially, new management;

Additionally, while Trustees can come in different brands and
with differently colored stripes, there is no clear authority in
the Third Circuit that permits appointment of a trustee for the
sole purpose of prosecuting lawsuits.  (W.R. Grace Bankruptcy
News, Issue No. 30; Bankruptcy Creditors' Service, Inc.,
609/392-0900)


W.R. GRACE: Wants More Time to Make Lease-Related Decisions
-----------------------------------------------------------
For the third time, W. R. Grace & Co., and its debtor-affiliates
ask Judge Fitzgerald to extend the deadline to decide whether to
assume, assume and assign, or reject unexpired non-residential
real property leases.  The Debtors ask for an extension until
April 1, 2003.

The Debtors make it clear this request is without prejudice to
the Company's right to request a further extension of the
deadline, and without prejudice to any lessor's right to request
to shorten the lease decision period on a particular lease.

The Debtors remind Judge Fitzgerald that they are parties to
several hundred unexpired leases that fall into two major
categories:

    (a) real property leases for offices and plants throughout
        the United States and Puerto Rico; and

    (b) leases where the Debtors are lessees of commercial real
        estate, often retail stores, restaurants, and other
        similar facilities most of which have been sub-leased to
        other tenants.

These leases are important assets of the estate, such that the
decision to assume or reject is central to any plan of
reorganization.  Furthermore, these cases are large and complex,
and involve many leases.  Since the first extension order
was entered, the Debtors' management and professionals have been
consumed with the operation of the Debtors' businesses and the
resolution of a number of complex business decisions.
Furthermore, the Debtors have focused on defining the mounting
asbestos-related litigation liabilities that they contend
precipitated these Chapter 11 cases.  Resolution of these issues
will involve significant litigation that will take time.  The
Debtors have not yet intelligently appraised each lease's value
to its plan, and until the asbestos issues are resolved, little
progress can be made toward developing a viable plan of
reorganization.

The Debtors assure Judge Fitzgerald that they are current in all
of their postpetition rent payments and other contractual
obligations with respect to the unexpired leases.  The Debtors
intend to continue to timely pay all rent obligations on leases
until they are either rejected or assumed, and will continue to
timely perform their contractual obligations with respect to the
assumed leases.  As a result, the Debtors' continued occupation
of the relevant real property (whether directly or as
sublessees) will not prejudice the lessors of the real property
or cause the lessors to incur damages that cannot be recompensed
under the Bankruptcy Code.

By application of Del.Bankr.LR 9006-2, the current deadline is
automatically extended through the conclusion of the October 28,
2002 hearing. (W.R. Grace Bankruptcy News, Issue No. 29;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


* BOOK REVIEW: The Phoenix Effect: Nine Revitalizing Strategies
                No Business Can Do Without
----------------------------------------------------------------
Authors: Carter Pate and Harlann Platt
Publisher: John Wiley & Sons, Inc.
Softcover: 244 Pages
List Price: $27.95
Review by Gail Owens Hoelscher
Buy a copy for yourself and one for a colleague on-line at
http://amazon.com/exec/obidos/ASIN/0471062626/internetbankrupt  

Think of all the managers of faltering companies who dream of
watching those companies rise from the ashes all around them!
With a record number of companies failing in 2001, and another
record-setting year expected for 2002, there are a lot of ashes
from which to rise these days.

Carter Pate and Harlan Platt highly value strong leadership able
to sharpen a company's focus and show the way to the future.
They believe that all too often, appropriate actions required to
improve organizations are overlooked because upper management
either isn't aware of the seriousness of the issues they face or
they don't know where to turn for accurate information to best
address their concerns. In the Phoenix Effect, the authors
present their ideas to "confront, comprehend, and conquer a
company's ills, big and small."

These ideas are grouped into nine steps: (i) Find out whether
the company needs a tune-up, a turnaround, or crisis management.
Locate the source of "the pain." (ii) Analyze the true scope of
the company's operations. Decide whether to stay in the same
businesses, withdraw from existing businesses, or enter new
ones. (iii) Hold the company to its mission statement. If it
strives to be "the most environmentally friendly." Figure out
how. (iv) Manage scale. Should the company grow, stay the same
size, or shrink? (v) Determine debt obligations and work toward
debt relief. (vi) Get the most from the company's assets.
Eliminate superfluous assets and evaluate underused assets.
(vii) Get the most from the company's employees. Increase output
and lower workforce costs. (viii) Get the most from the
company's products. Turn out products that are developed and
marketed to fill actual, current customer needs. (ix) Produce
the product. Search for alternate ways to create the product:
owning or leasing facilities, outsourcing, etc.

The authors believe that "how you're doing is where you're
going." They assert that the "one fundamental source of life  in
companies, as in people,.is the capacity for self-renewal, the
ability to excite your team for game after game. to go for broke
season after season." This ability can come from "(g)enetics,
charisma, sheer luck, stock options - all  crucial, yes, but the
best renewal insurance is a leader who always knows exactly how
his or her company is doing."

There are a lot of books written on this topic. Pate and Platt
successfully bridge the gap between overgeneralization and too
detail. They are equally adept at advising on how to go about
determining a business's scope and arguing for Monday rather
than Friday for implementing layoffs. They don't dwell on sappy
motivational techniques. They don't condescend to the reader or
depend too much on folksy vernacular and clich,. Their message
is clear: your company's phoenix, too, can rise from its ashes.

* Carter Pate is a well known turnaround expert at
PricewaterhouseCoopers with more than 20 years experience
providing strategic consulting and implementation strategies.

* Harlan Platt is a professor of finance at Northeastern
University and author of the book Principles of Corporate
Renewal.

                          *********

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-
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are $25 each.  For subscription information, contact Christopher
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                *** End of Transmission ***