TCR_Public/021230.mbx          T R O U B L E D   C O M P A N Y   R E P O R T E R

             Monday, December 30, 2002, Vol. 6, No. 256

                           Headlines

360NETWORKS: Secures Nod to Enter into T-System Settlement Pact
ACORN PRODUCTS: Completes Recapitalization Plan via Debt Swap
ADVANCED GLASSFIBER: Look for Schedules & Statements by Feb. 10
ALLIANT ENERGY: Unit Completes $300MM Sr. Debt Private Offering
ALOHA AIRLINES: Secures $45 Million ATSB-Guaranteed Financing

AMERICA WEST: Reaches Tentative Labor Agreement with Pilots
AMERICAN GREETINGS: Reports Improved Third Quarter Performance
AMERICAN MILLENNIUM: Funds Insufficient to Meet Capital Needs
ANACOMP INC: Moves into New Headquarters in San Diego, Calif.
ANC RENTAL: Wins Nod to Consolidate Operations in Portland, OR

AVAYA: Commences Exchange Offer for Liquid Yield Option Notes
AVAYA INC: Nominates Bruce R. Bond to Board of Directors
BETHLEHEM STEEL: Court OKs Stipulation Settling Genesee's Claim
CENTENNIAL COMMS: S&P Ratchets Corp. Credit Rating Down a Notch
CHIEF CONSOLIDATED MINING: Auditors Express Going Concern Doubt

CLAXSON INTERACTIVE: Strikes New Int'l TV Deal with Playboy Ent.
CLICKNSETTLE.COM: Fails to Comply with Nasdaq Listing Standards
CMS ENERGY: S&P Affirms BB Rating on Pipeline Sale Announcement
COMMUNICATION DYNAMICS: Panel Taps Young Conaway as Co-Counsel
CONSECO INC: Taps Kirkland & Ellis as Lead Bankruptcy Counsel

CONSOLIDATED FREIGHTWAYS: Court Fixes February 7 Claims Bar Date
CONTINUCARE: Terminates One of Independent Practice Associations
CORRECTIONAL SERVICES: Sells Florence Arizona Facility for $10MM
COX TECHNOLOGIES: Net Capital Deficit Widens to $2.4M at Oct. 31
CTC COMMUNICATIONS: Gets Nod to Hire CXO as Turnaround Manager

DENBURY RESOURCES: Provides Update on Drilling Operations
DENNY'S CORP: S&P Assigns BB- Senior Secured Bank Loan Rating
DIAMOND BRANDS: Del. Court Sets January 29 Confirmation Hearing
EEL RIVER SAWMILL: State Takes Over Workers Compensation Program
EGAIN COMMS: Secures Additional Credit Line of Up to $5 Million

ENCOMPASS SERVICES: Court Grants Priority on Postpetition Goods
ENRON CORP: Faulconer Demands Payment of $8-Million Admin. Claim
EOTT ENERGY: Court to Consider Chapter 11 Plan on January 30
FEDERAL-MOGUL: Appoints Aon to Manage Employee Stock Programs
FOCAL COMMS: S&P Drops Rating to D After Bankruptcy Filing

GENUITY INC: Signs-Up Baker & McKenzie as Special Counsel
GLOBAL CROSSING: Court Okays Cooperman's Appointment as Examiner
GOODYEAR TIRE: S&P Hatchets Credit Rating Down 2 Notches to BB-
GOODYEAR TIRE: Expresses Disappointment with S&P's Downgrades
GREEN FUSION: Seeking New Financing to Continue Ops. & Pay Debts

GROUP TELECOM: Ontario Court OKs Plan of Arrangement & Reorg.
HECLA MINING: Will Defer Payment of January 1 Preferred Dividend
HOLLINGER INT'L: Closes Private Placement of 9% Senior Notes
HORIZON GROUP: Selling Partnership Interests to Pleasant Lake
INSILCO TECH: Secures Nod to Pay $500K of Critical Vendors Claim

IVG CORP: Wrinkle Gardner Resigns as Certifying Accountants
J. CREW GROUP: Completes New $180MM Credit Facility Arrangement
KMART CORP: Taps S&P Corporate Value as Valuation Consultant
MAGNUM HUNTER: Redeems $30,000,000 of 10% Senior Notes Due 2007
MASSEY ENERGY: W. Virginia Court Reverses WVDEP Suspension Order

NAT'L CENTURY: Mid Atlantic et al Seeks Relief from Injunction
NATIONAL STEEL: Court Approves Stipulation with Portside Energy
NCS HEALTHCARE: Omnicare Amends Tender Offer Expiring on Jan. 7
NERVA: Fitch Cuts 4 Note Classes Ratings to Junk & Low-B Level
OAKWOOD HOMES: Fitch Further Junks Manufactured Housing Deals

PACIFIC GAS: Wins Court Approval to Hire Vantage Consulting
PALADYNE CORP: Independent Auditors Express Going Concern Doubt
PERKINELMER: Completes Refinancing and Extends Debt Maturities
PROVANT INC: Enters Pact to Sell Drake Beam Morin-Japan for $30M
QWEST: S&P Drops Ratings to SD After Debt Exchange Completion

RECOTON CORP: Completes Two Asset Dispositions for $35 Million
RESTORAGEN: Selling Rights to Phase 2 GLP-1 Program to Amylin
RFS ECUSTA: Committee Brings-In CVH as Industry Consultant
RIBAPHARM: Delaware Court Imposes TRO Against Company Directors
RIBAPHARM: Denies ICN's Statements and Cites Solid Fin'l Results

ROYAL HAVEN: Has Until Jan. 17 to File Schedules & Statements
SALOMON BROTHERS: Fitch Rates Class B-4 and B-5 at Low-B Levels
SEVEN SEAS PETROLEUM: AMEX Halts Trading Effective December 24
STRUCTURED ENHANCE: Fitch Cuts Series 1999-1 $47MM Notes to BB-
TESORO PETROLEUM: Completes Asset Sale to Kaneb Pipe for $100MM

TOWN SPORTS INT'L: S&P Affirms B Corporate Credit Rating
TRENWICK GROUP: Renews $182 Million Lloyd's Letters of Credit
UNICCO SERVICE: S&P Downgrades & Keeps Ratings on Watch Negative
UNITED AIRLINES: Signs-Up Deloitte & Touche as Accountants
UNITED AIRLINES: Reports Record 90.7% Revenue Load Factor

UNITED AIRLINES: Files Request for Approval to Impose Wage Cuts
UNOCAL CORP: Lowers Earnings Guidance for Fourth Quarter 2002
US AIRWAYS: Simulator Engineers Ratify Cost-Saving Agreement
US AIRWAYS: Gets Nod to Begin Code Sharing with Windward Airways
VENTURES NATIONAL: Stonefield Josephson Airs Going Concern Doubt

WARNACO GROUP: Court Approves Wachner Claim Settlement Agreement
WESTAR ENERGY: Receives FERC Subpoena to Produce Documents
WORLDCOM: Posts $205MM Net Loss on $2.3BB Revenue for October
WORLDCOM INC: Wants to Pull Plug on Sprint Backhaul Agreement

* BOND PRICING: For the week of Dec. 30, 2002 - Jan. 3, 2003

                           *********

360NETWORKS: Secures Nod to Enter into T-System Settlement Pact
---------------------------------------------------------------
Pursuant to Section 365(a) of the Bankruptcy Code and Rule 9019
of the Federal Rules of Bankruptcy Procedure, 360 USA obtained
the Court's authority to:

     (a) assume a Communications Service Agreement, as amended
         pursuant to the Amended Agreement; and

     (b) enter into a Settlement Agreement with T-Systems USA,
         Inc.

As previously reported, 360 USA and T-Systems are parties to a
Communications Service Agreement wherein T-Systems was to
purchase wavelengths, dark fiber, equipment space within
collocation facilities and other capacity services on the
network of 360 USA and its affiliates.  The Service Agreement
had a term of at least 20 years.  During the first two years of
the Service Agreement, T-Systems agreed to a "take or pay"
arrangement, under which T-Systems was required to purchase at
least $50,000,000 in products and services from 360 USA.
Although that two-year period was to expire on December 15,
2002, Mr. Lipkin informs Judge Gropper, T-Systems has fulfilled
less than 25% of its commitment.

In addition, numerous disputes arose regarding the parties'
performance and payment obligations under the Service Agreement.
On August 28, 2002, T-Systems filed a motion for stay relief and
alleged that 360 USA had materially breached the Service
Agreement, was incapable of performing under the Service
Agreement, and had no means to satisfy the requirement of
Section 365 to cure defaults or to provide adequate assurance of
future performance under the Service Agreement.  T-Systems also
maintained that 360 USA's alleged breached had caused
irreparable harm to T-Systems' business.  The Debtors denied all
of the allegations.

The Parties then engaged in substantial discovery and arm's-
length negotiation.  Accordingly, the Parties reached an
agreement that is formalized under the Settlement Agreement and
the Amended Agreement.

The salient terms of the Settlement Agreement are:

A. Consideration.  360 USA and T-System will enter into the
    Amended Agreement by the date that the Bankruptcy Court
    approves the Settlement Agreement and authorizes 360 USA's
    assumption of the Amended Agreement;

B. Assumption of Communications Services Agreement.  Upon
    closing, 360 USA will assume the Amended Agreement in
    accordance with Section 365;

C. Predicates to Assumption.  Assumption of the Service
    Agreement, as amended by the Amended Agreement, will be on
    these terms:

     (a) No cure amounts will be required; 360 USA and T-Systems
         will waive any and all prior defaults under the Service
         Agreement; and

     (b) 360 USA will have no obligation to provide adequate
         assurance of future performance in order to assume the
         Amended Agreement.

C. Mutual Releases.  360 USA will release T-Systems from any
    and all claims, demands, obligations, actions, causes of
    action, rights or other damages arising out of any contract
    that is subject of the Settlement Agreement and T-Systems
    will release 360 from any and all claims, demands, actions,
    causes of action, rights or other damages arising out of any
    contract, which is subject of the Settlement Agreement;

D. Disallowance of Claims.  T-Systems consents to the
    disallowance with prejudice of any claims it filed in the
    Debtors' Chapter 11 cases or any claims filed by T-Systems in
    the related CCAA cases in Canada;

E. Court Approval.  The Settlement Agreement and assumption of
    the Amended Agreement are subject to the approval of this
    Court; and

F. Construction of Contracts.  For purposes of the Settlement
    Agreement, 360 USA and T-Systems agree to treat the Amended
    Agreement as an executory contract within the meaning of
    Section 365.  By entering into the Settlement Agreement, no
    party is waiving, nor will be deemed to have waived, any
    rights or positions that it has asserted or might in the
    future assert in connection with any contract, agreement,
    claim, matter or entity outside the scope of the Settlement
    Agreement.

On the other hand, the principal provisions of the Amended
Agreement are:

A. New Agreement.  The Amended Agreement replaces and supercedes
    the Service Agreement in all respects and the Amended
    Agreement constitutes the entire agreement with regard to
    Products and Services;

B. Products and Services Covered.  T-Systems will purchase, and
    360 USA will provide, wavelengths, equipment space within
    certain facilities and related construction, and installation
    and maintenance services from time to time through a written
    purchase order;

C. Minimum Commitment.  T-Systems commits to purchase from 360
    USA almost $66,000,000 of wavelength products and services
    over the next seven years.  The Amended Agreement contains
    annual minimum commitments and provisions that ensure
    T-Systems will satisfy its annual Minimum Commitment;

D. Term.  The term of the Amended Agreement would commence on
    the execution date of the Amended Agreement and expire on
    the latest expiration date of the term of a Product offered
    pursuant to the Amended Agreement, unless otherwise
    terminated in accordance with the Amended Agreement.
    Expiration of the term would not affect T-Systems'
    obligation to pay the Minimum Commitment;

E. Component Parts.  The Amended Agreement consists of general
    terms and conditions, a wavelength schedule, a co-colocation
    facilities schedule, a price schedule, a technical
    requirements schedule, an SLA schedule, each order and any
    amendments thereto; and

F. Confidentiality.  The Amended Agreement, and all related
    information, data, software and other data associated with
    either party to the Amended Agreement will be confidential
    and will not be disclosed without the prior written consent
    of the non-disclosing party. (360 Bankruptcy News, Issue No.
    40; Bankruptcy Creditors' Service, Inc., 609/392-0900)


ACORN PRODUCTS: Completes Recapitalization Plan via Debt Swap
-------------------------------------------------------------
Acorn Products, Inc., (Nasdaq:ACRN) has completed its previously
announced Recapitalization Plan.

In connection with the Recapitalization, the Company issued
3,857,973 shares of common stock to funds and accounts managed
by TCW Special Credits and Oaktree Capital Management upon
conversion of 12% Convertible Notes and Series A Preferred Stock
held by the funds. The funds collectively own approximately 89%
of the Company's outstanding shares. All amounts converted by
TCW and Oaktree converted at $5.00 per share, worth
approximately $19 million in aggregate before expenses.

Also as part of the Recapitalization Plan, the Company completed
its Rights Offering to existing stockholders on December 23,
2002. Minimal participation was recorded.

The result of the conversion and the completed rights offering
is that the Company has 4,905,834 shares outstanding.

Additionally, on December 20, 2002, the Company again began
trading under the ticker symbol "ACRN" on the Nasdaq SmallCap
Market. The ticker symbol had temporarily changed to "ACRND" for
20 trading days following the Company's reverse stock split on
November 21, 2002.

A. Corydon Meyer, President and Chief Executive Officer of
Acorn, was elected to the additional office of Chairman at a
December 10th board meeting. He commented, "We are excited to
have successfully completed our recapitalization and the move to
our new distribution facility in the fourth quarter of this
year. We believe our conservative capital structure, including
over $8 million in cash and availability, and our strengthened
operating platform provide us with the tools and resources
necessary to profitably build our business and service our
customers."

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, and cutting tools. 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.

                          *   *   *

                  Going Concern Uncertainty

Acorn Products' September 29, 2002 balance sheet shows that its
total current liabilities exceeded total current assets by about
$16 million.

In its Form 10-Q filed with the Securities and Exchange
Commission on November 13, 2002, the Company reported:

"The Company's consolidated financial statements have been
presented on a going concern basis, which contemplates the
realization of assets and the satisfaction of liabilities in the
normal course of business. The Company is substantially
dependent upon borrowing under its credit facility.

"On June 28, 2002, the Company entered into a recapitalization
transaction, obtaining a new $10.0 million investment from its
majority stockholders representing funds and accounts managed by
TCW Special Credits and Oaktree Capital Management, LLC. The
Company also entered into a new $45.0 million credit facility,
agented by CapitalSource Finance, LLC, consisting of a $12.5
million term loan and a $32.5 million revolving credit
component. The term loan bears interest at prime plus 5.0% and
the revolving credit component bears interest at prime plus
3.0%. The Lender's facility terminates initially in December
2004 which is automatically extended to June 2007 upon
completion of an offering of common shares to minority
stockholders and conversion of certain convertible notes and
preferred stock described below. The majority of the proceeds
from this transaction went to pay off borrowings under the
Company's previous credit facility ($33.7 million was borrowed
as of June 27, 2002), that otherwise expired on June 30, 2002.
Relative to the extension and termination of its previous credit
facility, the Company paid $2.0 million of success fees during
the second quarter of fiscal 2002. At September 29, 2002, the
Company had $8.4 million available to borrow under its new
credit facility."


ADVANCED GLASSFIBER: Look for Schedules & Statements by Feb. 10
---------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware gave
Advanced Glassfiber Yarns LLC and its debtor-affiliate an
extension of the deadline to file their schedules of assets and
liabilities, statements of financial affairs and lists of
executory contracts and unexpired leases as required under 11
U.S.C. Sec. 521(1).  The Debtors have until February 10, 2003,
to file these documents.

Advanced Glassfiber Yarns, LLC and its debtor-affiliate, AGY
Capital Corp., are affiliates of Owens Corning.  They are one of
the largest manufacturers and global suppliers of glass yarns.
The Company field for chapter 11 protection on December 10,
2002.  Mark E. Felger, Esq., at Cozen O'Connor and Alan B.
Hyman, Esq., at Scott K. Rutsky, Esq., represent the Debtors in
their restructuring efforts.  When the Company filed for chapter
11 protection, it listed $194.1 million in total assets and $409
million in total debts.


ALLIANT ENERGY: Unit Completes $300MM Sr. Debt Private Offering
---------------------------------------------------------------
Alliant Energy Corporation (NYSE: LNT) said its subsidiary,
Alliant Energy Resources, Inc., completed a private placement of
$300 million aggregate principal amount of senior notes.  The
senior notes have an interest rate of 9.75% and will be due in
2013.  Alliant Energy Corporation has agreed to unconditionally
guarantee the payment of principal and interest on the senior
notes.

Alliant Energy Resources will apply the approximately $288.8
million of net proceeds from the private placement to repay
short-term debt.

The private placement of senior notes was conducted in
accordance with Rule 144A under the Securities Act of 1933.  The
senior notes have not been registered under the Securities Act
of 1933 and may not be offered or sold absent registration under
such Act or an applicable exemption from the registration
requirements.

Alliant Energy is an energy-services provider that serves more
than three million customers worldwide. Providing its regulated
customers in the Midwest with electricity and natural gas
service remains the company's primary focus. Other key business
platforms include the international energy market and non-
regulated domestic generation. Alliant Energy, headquartered in
Madison, Wis., is a Fortune 1000 company traded on the New York
Stock Exchange under the symbol LNT. For more information, visit
the company's Web site at http://www.alliantenergy.com

Alliant Energy's September 30, 2002 balance sheet shows that
total current liabilities eclipsed total current assets by about
$400 million.


ALOHA AIRLINES: Secures $45 Million ATSB-Guaranteed Financing
-------------------------------------------------------------
Aloha Airlines announced the completion of a $45 million loan
from Citibank along with the final approval and issuance of a
$40.5 million loan guarantee from the Air Transportation
Stabilization Board.

The loan was arranged by Salomon Smith Barney and Mercer
Management Consulting acted as financial adviser.

Glenn R. Zander, Aloha's President and Chief Executive Officer,
expressed thanks and appreciation to Aloha's employees,
shareholders, banks, and aircraft lessors for the concessions
made as part of the loan process. Additionally, he noted that
the support of Hawaii's Congressional Delegation, led by U.S.
Senator Daniel K. Inouye, was instrumental in demonstrating the
key role Aloha plays in the region's transportation system.

"[This] marks a new beginning for Aloha," said Zander.  "With
the completion of this financing, Aloha will be able to move
forward with its plans for the future, which include further
increases of service to the U.S. Mainland and Pacific islands,
as well as continuing to serve the people of Hawaii in our
traditional inter-island transportation niche.  The support of
the lenders, lessors, the ATSB and our employees is greatly
appreciated."

Aloha Airlines is a privately held carrier that has served
Hawaii's inter-island market since 1946.  Beginning in February
2000, Aloha expanded its service to West Coast markets including
Oakland, Orange County and Burbank, California; Las Vegas,
Nevada; Phoenix, Arizona; and Vancouver, Canada. Aloha also
serves destinations in the Pacific, including Rarotonga in the
Cook Islands and Majuro in the Marshall Islands.


AMERICA WEST: Reaches Tentative Labor Agreement with Pilots
-----------------------------------------------------------
America West Airlines (NYSE: AWA) has reached a tentative
agreement for a new contract with the Air Line Pilots
Association (ALPA), which represents the airline's 1,700 pilots.

"We are pleased that an agreement has been reached," said
Douglas Parker, chairman and chief executive officer.  "Full
credit goes to the negotiating teams of America West and ALPA,
along with the federal mediator, for their dedication,
persistence and professionalism throughout this process, and for
their determination to bring these discussions to a conclusion
during this holiday period.

"We will continue to work with the leadership of ALPA with the
goal of having the agreement ratified by our 1,700 pilots as
quickly as possible."

The agreement is subject to ratification by ALPA membership.
Terms of the agreement were not disclosed.

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

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


AMERICAN GREETINGS: Reports Improved Third Quarter Performance
--------------------------------------------------------------
American Greetings Corp., (NYSE: AM) announced a $40.4 million
increase in reported net income over prior year, on sales growth
of 2.2 percent, for the third quarter of fiscal year 2003.
Excluding prior year's special charges, third quarter net income
was up 15 percent compared to prior year.

The Corporation realized net income of $47.0 million, or 62
cents per share, for the third quarter ended Nov. 30, 2002.
These results compare to net income before special charges of
$40.9 million for the third quarter of fiscal 2002. Including
all special charges in the third quarter of the prior year, the
Corporation reported net income of $6.6 million.

Reported net sales in the third quarter were $588.8 million, a
2.2 percent increase compared to reported net sales of $575.9
million in the third quarter of last year. Excluding prior
year's special charges, net sales were down 4.7 percent.

Chairman and chief executive officer Morry Weiss said the
Corporation's results for the third quarter were very
encouraging. "We are very pleased that our cost savings
initiatives drove double-digit EPS growth, despite previously
disclosed account losses," Weiss said. "We are also pleased that
cash flow continues to improve compared to the prior year."

For the first three quarters of fiscal 2003, the Corporation
reported net income of $75.7 million. Included in these results
is a favorable impact of 10 cents per share from the sale of an
investment. This compares to last year's net income excluding
special charges of $31.3 million. Prior year's reported net loss
was $109.2 million.

Year to date net sales were $1.47 billion, a 7.7 percent
increase compared to $1.365 billion in the same period last
year. Excluding prior year special charges, net sales for the
first nine months were up 0.5 percent. This year's results
reflect the adoption of EITF Issue No. 01-09, "Accounting for
Consideration Given by a Vendor to a Customer/Reseller;" last
year's results have been reclassified to reflect this new
pronouncement. These reclassifications in the prior year
resulted in decreases in the material, labor and other
production costs and selling, distribution and marketing
captions, with a corresponding decrease in net sales and had no
effect on net income.

Certain covenants of the Corporation's debt agreements are based
on calculations of adjusted earnings before interest, taxes,
depreciation and amortization (EBITDA). As such, adjusted EBITDA
was $113.4 million for the third quarter, compared to adjusted
EBITDA of $109.1 million (which excludes special charges) for
the same period last year. EBITDA for the trailing four quarters
(which excludes special charges) was $343.4 million, compared to
adjusted EBITDA for the year-ago trailing four quarters of
$287.1 million.

                          Business outlook

Weiss reaffirmed the Corporation's previously announced full-
year earnings estimate of $1.45 to $1.55 per share (excluding
the one-time gain on the sale of an investment). "We expect the
challenging retail conditions that we encountered this quarter
to continue for the balance of the year, but our cost-savings
initiatives will continue to benefit our bottom line," Weiss
said. "As such, we remain comfortable with our earnings
estimate."

American Greetings Corporation (NYSE: AM) is the world's largest
publicly held creator, manufacturer and distributor of greeting
cards and social expression products. Its staff of artists,
designers and writers comprises one of the largest creative
departments in the world and helps consumers "say it best" by
supplying more than 15,000 greeting card designs to retail
outlets in nearly every English-speaking country. Located in
Cleveland, Ohio, American Greetings generates annual net sales
of approximately $2 billion. For more information on the
Corporation, visit http://corporate.americangreetings.comon the
World Wide Web.

                          *     *     *

As previously reported, Standard & Poor's affirmed its triple-
'B'-minus corporate credit and senior secured debt ratings and
its double-'B'-plus subordinated debt rating for American
Greetings Corp., and removed the ratings from CreditWatch where
they were placed January 23, 2002.

The outlook is negative.

A successfully completed major corporate reorganization of the
core greeting cards business to rationalize its brands,
products, and facilities in the fiscal year ended February 2002
is expected to generate pretax savings of about $90 million this
fiscal year.


AMERICAN MILLENNIUM: Funds Insufficient to Meet Capital Needs
-------------------------------------------------------------
American Millennium Corporation, Inc., is an information
management company specializing in the provision of
services for monitoring remote, high value assets using
proprietary hardware and data management software and wireless
communications based on the Vistar Telecommunications geo-
stationary satellite system.

The Company's primary focus today is on providing information
management services for the oil and gas industry through the
development of a telemetry system for the installed base of gas
compressors in North America. The AMCI Sentry product line
includes proprietary hardware and sensors as well as SatAlarm,
the Company's back-end server software, all of which has been
fully integrated into a reliable, easy to use system. The
essential function of this product line is to provide an alert
when a gas compressor stops operating allowing field maintenance
personnel the opportunity to quickly go to the inoperative unit
and get it back up.

During the three months ended October 31, 2002, revenues
decreased approximately 16% to $214,282 compared to the same
period in 2001. This decrease in year over year revenue was due
to fact that the Company had held up production of its inventory
pending its Class I, Division 2 certification, which it received
on October 14, 2002.

The Company had a net loss of $485,242 on revenues of $214,282
for the three months ended October 31, 2002 compared to a net
loss of $368,456 on revenues of $254,646 for the period ended
October 31, 2001. The increase in net loss was primarily
attributable to increased consulting and professional fees, and
an increase in interest expense.

American Millennium says it understands that cash and
equivalents on hand at October 31, 2002, are not adequate to
meet its short-term capital needs. On October 11, 2002 the
Company issued 1,000,000 shares of its Series A Preferred stock
and it received net cash proceeds of $2,500,000. The majority of
this cash was used to make deposits on equipment and inventory
to be used in its South American Operations. Although the
Company believes that its current, and several new investors,
are committed to American Millennium's future success, there can
be no assurance that additional funds will be available when
needed on commercially reasonable terms.

As a result of net losses incurred, the Company has used
substantial working capital in its operations. There is
substantial doubt as to its ability to continue as a going
concern without additional financing or capital infusion.


ANACOMP INC: Moves into New Headquarters in San Diego, Calif.
-------------------------------------------------------------
Anacomp, Inc. (OTC Bulletin Board: ANCPA), a global provider of
information outsourcing, maintenance support, and imaging and
print solutions, has opened the doors for business at its new
Corporate headquarters building in the Carmel Mountain Ranch
area of San Diego.

"Our new facility will provide Anacomp with an enhanced
corporate presence, and our employees with an improved working
environment in which to serve valued stakeholders better," said
Jeff Cramer, president and chief executive officer of Anacomp.

Also included at the new location is Anacomp's San Diego Data
Center, which provides outsourced CD, print and micrographic
services to some 40 customers through its extensive distribution
network.  Combined with its service and support facility in
Vista, Anacomp's San Diego County work force encompasses
approximately 325 personnel.

The Company also announced that it will host a conference call
for the investment community on January 7, 2003 to discuss the
results of its fourth quarter and fiscal year ended September
30, 2002.  The conference call, which will begin at 8:30 a.m.
PST, may be accessed at 1-800-857-9602, Leader: Jeff Cramer,
Passcode: Analyst.  The conference call replay number will be
1-800-685-1821, Passcode 10703.  It will replay for one week
until January 14, 2003.

Lastly, Anacomp will hold its 2003 Annual Meeting of
Shareholders at the Company's new corporate headquarters on
February 25, 2003, at 1 p.m. PST.  All Anacomp Shareholders are
invited to attend the Meeting.

Contact information for Anacomp's new offices is as follows:
Anacomp, Inc., 15378 Avenue of Science, San Diego, CA  92128-
3407, (858) 716-3400.

Anacomp, Inc., provides comprehensive information outsourcing,
maintenance support, and imaging and print solutions to
approximately 7,000 businesses and organizations in
approximately 70 countries either directly or through its
worldwide network of dealers and distributors.  Founded in 1968
and headquartered in San Diego, Anacomp offers a full range of
solutions for the secure capture, production, presentation,
retrieval and archive of critical business documents, as well as
professional services for mass storage, computing and networking
equipment.  Current product and service offerings include
digital document services, document imaging services, print and
micrographic services, business continuity services, multi-
vendor services and support, and imaging and print systems and
supplies.  For more information, visit Anacomp's Web site at
http://www.anacomp.com

Anacomp's June 30, 2002 balance sheet reported a working capital
deficit of about $16 million.


ANC RENTAL: Wins Nod to Consolidate Operations in Portland, OR
--------------------------------------------------------------
ANC Rental Corporation and its debtor-affiliates obtained
permission from the Court to reject all of Alamo's agreements
with the Portland International Airport in Portland, Oregon, and
assume National's agreements and assign them to ANC Rental Corp.

ANC has agreed to deposit with the airport authority a security
deposit equal to 50% of the Minimum Annual Guarantee under the
National's concession agreement.  The current Minimum Annual
Guaranty is $1,100,004.  With the Court's approval, a $550,000
security deposit will be deposited with the airport authority.

The consolidation of operations is expected to generate savings
over $1,387,000 per year in fixed facility costs and other
operational cost savings. (ANC Rental Bankruptcy News, Issue No.
24; Bankruptcy Creditors' Service, Inc., 609/392-0900)


AVAYA: Commences Exchange Offer for Liquid Yield Option Notes
-------------------------------------------------------------
Avaya Inc., (NYSE: AV) a leading global provider of
communications networks and services to businesses, announced
the commencement of an offer to exchange up to $660,542,000
aggregate principal amount at maturity of its Liquid Yield
Option(TM) Notes due 2021 that were issued in October 2001,
representing approximately 70 percent of the aggregate principal
amount at maturity of the outstanding LYONs.

Warburg Pincus Equity Partners, L.P., and affiliated investment
funds are participating in the exchange offer with Avaya.
Warburg Pincus is a significant shareholder of Avaya and owns
approximately 14.5 percent of Avaya's outstanding common stock.

The offer will expire at midnight New York City time on Jan. 22,
2003, unless extended. Tendered LYONs may be withdrawn at any
time prior to the expiration date.

Tendering LYON holders will have the option to receive in
exchange for each LYON either: (1) mixed consideration having an
aggregate value equal to $407.74 consisting of $203.87 in cash
plus a number of shares of Avaya common stock having an offer
value equal to $203.87 subject to a collar; or (2) $389.61 in
cash. The number of shares issuable as part of the mixed
consideration will be based on the five-day volume-weighted
average price of Avaya's common stock ending on the second day
prior to the expiration date, subject to a collar of not more
than 102 shares or less than 76 shares per LYON. The mixed
consideration based on the offer value represents a 12.5 percent
premium, and the cash consideration represents a 7.5 percent
premium, to $362.43, the last reported price of the LYONs on
Dec. 20, 2002.

The offer will be prorated so that (i) no more than $660,542,000
aggregate principal amount at maturity of LYONs are accepted for
exchange, (ii) all LYONs tendered for the mixed consideration
are accepted before any are accepted for the cash consideration
and (iii) not more than $200 million in cash is paid in the
offer.

The purpose of the tender offer is to reduce Avaya's outstanding
indebtedness and provide Avaya with greater financial
flexibility. Given current market conditions, the cost to Avaya
to repurchase the LYONs in the offer would be lower than if
Avaya were required to repurchase such LYONs pursuant to their
terms on Oct. 31, 2004.

Under the terms of the agreement entered into between Avaya and
Warburg Pincus, Avaya will provide up to $100 million, and
Warburg Pincus will provide up to $100 million, of the $200
million in cash available to repurchase the LYONs in the
exchange offer. Warburg Pincus has agreed to exchange all LYONs
it purchases into common stock. For its financing commitment and
participation in the exchange offer Warburg Pincus will receive
warrants to purchase additional shares of common stock. Avaya
will issue all of the common stock in connection with the mixed
consideration.

Avaya also announced that Anthony Terracciano resigned from its
board of directors on Dec. 19, 2002. Under New York Stock
Exchange rules, Mr. Terracciano, a board member nominated by
Warburg Pincus, was required to resign from Avaya's board prior
to approval of the offer involving Warburg Pincus.

Under the agreement entered into by Avaya and Warburg Pincus,
Warburg Pincus has the right to nominate one individual to
Avaya's board of directors. Warburg Pincus has nominated
Joseph P. Landy, co-president of Warburg Pincus, for election to
the Avaya board. Avaya expects Mr. Landy will be elected as a
director of Avaya with a term expiring in 2004. In addition, if
Warburg Pincus provides at least $25 million for the purchase of
LYONs in the exchange offer, Warburg Pincus will have the right
to nominate an additional unaffiliated individual for election.

The terms and conditions of the exchange offer and the terms of
the arrangement between Warburg Pincus and Avaya are described
in the offer documents dated Dec. 23, 2002, and mailed to all
holders of the LYONs. The completion of the offer for the LYONs
is subject to the conditions described in the offer documents.

Subject to applicable law, the offerors may waive any condition
applicable to the offer or extend, terminate or otherwise amend
the offer. The tender offer is not conditioned on a minimum
amount of LYONs being tendered.

Morgan Stanley & Co., Incorporated is acting as dealer manager
for the exchange offer. Georgeson Shareholder Communications,
Inc. is the information agent, and The Bank of New York is the
exchange agent. Copies of the offer documents may be obtained at
no charge from the information agent at 866-296-4337 or 212-440-
9800 or from the SEC's Web site at http://www.sec.gov
Additional information concerning the terms of the exchange
offer, including all questions relating to the mechanics of the
offer, may be obtained by contacting the information agent at
866-295-4337 or Morgan Stanley at 212-761-5409 (collect).

A registration statement relating to the Avaya common stock
being offered has been filed with the Securities and Exchange
Commission but has not yet become effective. Such securities may
not be sold nor may offers to buy be accepted prior to the time
the registration statement becomes effective. This news release
shall not constitute an offer to sell or the solicitation of an
offer to buy nor shall there be any sale of the Avaya common
stock in any state in which such an offer, solicitation or sale
would be unlawful prior to registration or qualification under
the securities laws of any such state. The offer may only be
made pursuant to the Offer to Exchange/Prospectus and the
accompanying Letter of Transmittal.

Avaya Inc., designs, builds and manages communications networks
for more than 1 million businesses worldwide, including 90
percent of the FORTUNE 500(R). Focused on businesses large to
small, Avaya is a world leader in secure and reliable Internet
Protocol telephony systems and communications software
applications and services. Driving the convergence of voice and
data communications with business applications -- and
distinguished by comprehensive worldwide services -- Avaya helps
customers leverage existing and new networks to achieve superior
business results. For more information, visit the Avaya Web site
at http://www.avaya.com

                            *   *   *

As previously reported in Troubled Company Reporter, Standard &
Poor's Ratings Services lowered its corporate credit rating on
enterprise communications equipment and services provider Avaya
Inc., to double-'B'-minus from double-'B'-plus, lowered its
senior secured debt rating to single-'B'-plus from double-'B'-
minus, and lowered its senior unsecured debt rating to single-
'B' from double-'B'-minus. At the same time, Standard & Poor's
removed the ratings from CreditWatch, where they were placed on
July 31, 2002. The outlook is negative.


AVAYA INC: Nominates Bruce R. Bond to Board of Directors
--------------------------------------------------------
Avaya Inc., (NYSE: AV) a leading global provider of
communications networks and services to businesses, has
nominated Bruce R. Bond to its board of directors.

Bond is a former chairman and CEO of PictureTel Corporation.
Bond also was president and CEO of ANS Communications and a
managing director for BT in London where he headed the company's
Product and Services Group and the National Business
Communications Group.  He began his career with Ohio Bell and
held positions of increasing responsibility with AT&T in product
management, strategic planning and systems development.  He was
corporate vice president, strategic planning with US West prior
to moving to BT.

"Bruce Bond's broad and deep knowledge of the communications
industry make him a valuable addition to Avaya's board," said
Don Peterson, chairman and CEO, Avaya.  "As we accelerate our
focus on helping customers use communications solutions to drive
revenue and improve their operations, Bruce's experience will
add to our understanding of how businesses use communications to
improve results."

Bond has an M.A. from the Sloane School at the Massachusetts
Institute of Technology, and M.B.A. from the University of
Dayton.

Avaya Inc., designs, builds and manages communications networks
for more than 1 million businesses worldwide, including 90
percent of the FORTUNE 500(R). Focused on businesses large to
small, Avaya is a world leader in secure and reliable Internet
Protocol telephony systems and communications software
applications and services. Driving the convergence of
voice and data communications with business applications -- and
distinguished by comprehensive worldwide services -- Avaya helps
customers leverage existing and new networks to achieve superior
business results.  For more information, visit the Avaya Web
site at http://www.avaya.com


BETHLEHEM STEEL: Court OKs Stipulation Settling Genesee's Claim
---------------------------------------------------------------
Prior to Petition Date, Bethlehem Steel Corporation and its
debtor-affiliates, and Genesee & Wyoming Inc., entered into the
Purchase and Sale Agreement under which Bethlehem sold all of
the common stock of South Buffalo Railway Company to Genesee for
$33,000,000, of which $3,000,000 was deferred and deposited into
the Escrow Account.

The Purchase and Sale Agreement provides that the Debtors will
indemnify Genesee for a number of general liabilities arising
from the conduct of the business of South Buffalo prior to the
Closing Date.

Genesee asserts certain claims against the Debtors arising from
the Purchase and Sale Agreement in connection with settled
disputes specifically:

     (a) Retained Lawsuits
     (b) Retained Earnings Dispute; and
     (c) Locomotives Dispute.

The Debtors dispute certain of the amounts claimed by Genesee in
respect of the Settled Disputes.  Subsequently, in a Court-
approved Stipulation, the Parties agree to resolve the disputed
matter.

In particular, the parties stipulate:

   (a) the Debtors' liability to Genesee/South Buffalo on
       account of the Settled Disputes will be $1,583,485;

   (b) the Escrow Agent will transfer the settlement amount from
       the Escrow Account to Genesee;

   (c) South Buffalo will, at its own cost and expense, deliver
       to the Debtors and the Railroad Subsidiaries to an
       interchange point on South Buffalo's railroad tracks as
       designated by Bethlehem possession of the Locomotives in
       substantially the same condition as the Locomotives were
       in on October 1, 2001;

   (d) the Escrow Agent will be entitled to rely upon and fulfill
       Bethlehem's instructions in the form of the Payment
       Request;

   (e) upon receipt of the settlement payment by Genesee, any
       and all of its and South Buffalo's claims of any type or
       nature, legal or equitable, past, present or future
       against the Debtors and the Railroad Subsidiaries arising
       from, in connection with or in any way related to the
       Settled Disputes are deemed automatically and irrevocably
       satisfied and forever released;

   (f) upon the Debtors' and the Railroad Subsidiaries receipt of
       the Locomotives under the stipulated terms, any and all of
       its claims of any type or nature, legal or equitable,
       past, present or future against Genesee or South Buffalo
       arising from, in connection with or in any way related to
       the Settled Disputes are deemed automatically and
       irrevocably satisfied and forever released; and

   (g) Genesee or South Buffalo will undertake good faith efforts
       to obtain releases from Third Parties or any of South
       Buffalo's co-defendants, of any and all claims of any type
       or nature, legal or equitable, past, present or future
       against the Debtors' arising from, in connection with or
       in any way related to the Chapman Lawsuit, the Coffed
       Lawsuit and the Crushed Stone Lawsuit, respectively.

       In the event that Genesee or South Buffalo is unable to
       obtain a release from any of Third Parties, both  will
       have joint and several liability to indemnify the Debtors
       for any:

        (i) claims successfully asserted by the Third Parties
            against the Debtors; and

       (ii) costs and expenses, including attorneys' fees,
            incurred by the Debtors in defending itself from the
            claims. (Bethlehem Bankruptcy News, Issue No. 27;
            Bankruptcy Creditors' Service, Inc., 609/392-0900)

Bethlehem Steel Corp.'s 10.375% bonds due 2003 (BS03USR1) are
trading at about 2 cents-on-the-dollar, DebtTraders reports. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=BS03USR1for
real-time bond pricing.


CENTENNIAL COMMS: S&P Ratchets Corp. Credit Rating Down a Notch
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Centennial Communications Corp., to 'B' from 'B+'.
Centennial is primarily a wireless provider with some
competitive local exchange carrier and cable TV operations.

The rating remains on CreditWatch with negative implications. As
of November 30, 2002, the Wall, New Jersey-based company had
about $1.7 billion total debt outstanding.

"The downgrade reflects our assessment that a weaker business
profile will persist through the remainder of the fiscal year
ended May 31, 2003 and beyond. The company's domestic markets
have been subject to heightened competition from the larger,
more national players, such as AT&T Wireless and Cingular," said
Standard & Poor's credit analyst Catherine Cosentino. "As a
result, the cost per gross customer add in its U.S. markets has
remained fairly high at $365 for the three months ended
November 30, 2002. The company also lost about 10,000
subscribers in its U.S. wireless market since May 31, 2002,
against a backdrop of overall growth for the industry."

The CreditWatch on the company reflects Standard & Poor's
continued concerns about the Centennial's liquidity through the
fiscal year ended May 31, 2003. Standard & Poor's is also
concerned about the company's ability to meet financial
maintenance covenants under its secured bank loan agreement,
especially if operating cash flow from the Caribbean wireless
and broadband businesses do not grow materially in the remainder
of fiscal 2003 from fiscal 2002 levels.

If the company is not able to obtain additional liquidity
cushion and demonstrate its ability to meet bank financial
covenants in the near term, the ratings are likely to be lowered
by more than one notch.

Moreover, even if the company is able to address Standard &
Poor's concerns about near-term liquidity, the ratings could
still be subject to further downgrade based on Standard & Poor's
assessment of the company's business plans and execution
prospects for the second half of fiscal year 2003 as well as
fiscal 2004. This review will focus on the company's ability to
improve its overall level of operating cash flows during this
timeframe.


CHIEF CONSOLIDATED MINING: Auditors Express Going Concern Doubt
---------------------------------------------------------------
During the year ended December 31, 2001, Chief Consolidated
Mining Company began mining ore from the Trixie Mine and began
processing ore in the Company's Tintic Mill in January 2002. On
March 28, 2002, the Company encountered unstable mining
conditions and suspended mining and processing operations. As a
result of the suspended mining and processing operations, the
Company is not generating ongoing revenues and does not have
sufficient funding to make the significant safety improvements
required in the Trixie Mine or to continue exploration efforts
related to the Burgin Mine. Management and the Board of
Directors are currently pursuing efforts to obtain additional
sources of financing to allow the Company to proceed with its
operations. The Company is also studying and investigating
selling or developing portions of its land surface rights in
order to generate additional operating capital.

As of September 30, 2002, the Company had $950,000 of land and
mining claims and $756,363 of mining related buildings,
machinery and equipment, which in aggregate, represent
approximately 74 percent of total assets. The Company's
buildings, machinery and equipment consist principally of the
Tintic Mill located at the Trixie mine.  The realization of the
Company's investment in land and mining claims and mining
related buildings, machinery and equipment is dependent upon
various factors, including the outcome of: (i) the Company's
success in exploration efforts to discover additional mineral
resources and in proving the technical feasibility and
commercial viability of the identified mineral resources, (ii)
the Company's ability to obtain necessary funding to continue
exploration of the mining properties and to finance operations
while the Company pursues real estate development alternatives
for portions of the Company's land, (iii) the Company's success
in finding a joint venture partner to provide capital funding
for the Company's continued exploration of its mining
properties, (iv) the Company's ability to profitably lease the
Tintic Mill or its mining claims to outside entities, and (v)
the Company's success in selling or developing certain of its
land surface rights to fund its continued mining and exploration
activities.

During the last several months, the Company has been in
discussions with a group of Chief's significant stockholders in
connection with a plan to recapitalize the Company.  To the
extent such plan is completed, funds would be available for (i)
future exploration and development of the Company's mining
and/or real estate assets, (ii) the reduction of outstanding
indebtedness (including accounts payable), and (iii) other
general corporate purposes. The development of the Company's
mining and real estate assets may be performed in conjunction
with joint venture or strategic partners if appropriate.  Should
these efforts to recapitalize the Company not be successful, it
may be required to seek protection under the United States
Bankruptcy Code.

On December 10, 2002, the Board approved a subscription
agreement to raise up to $3 million from the issuance of
convertible secured debentures to accredited investors.  The
Debentures, if issued, will have a maturity date one year from
the date of issuance, unless earlier converted or extended by
agreement.  The Debentures may be converted into a new series of
convertible common stock at the rate of 5,000 shares for each
$1,000 principal amount of Debentures at each subscribers option
at any time after the Company's stockholders have approved
certain changes to the Company's articles of incorporation.  The
Debentures will earn interest at a rate of 6% per annum, payable
in lump sum at the time of repayment of the Debentures.  The
Debentures will be secured by a first mortgage security interest
on equipment and real estate assets of the Company with a forced
sale value (as determined by each subscriber) equal to at least
150% of the principal amount of the Debentures. If approved, the
new series of convertible common stock will have a liquidation
preference of $0.20 per share, subordinate to holders of
preferred stock with a liquidation preference of $0.50 per
share.  For liquidation purposes, the new series of convertible
common stock will share equally with the current outstanding
series of convertible common stock.  The new series of
convertible common stock will have voting rights of one vote per
share, whether or not converted, and will vote as a class with
the existing series of convertible common stock.  Warrants will
be issued in conjunction with the convertible debentures to
purchase an additional 10% of the new series of convertible
common stock.

Purchasers of the first $2 million in Debentures will have the
right to elect four Directors to the Board of the Company.  DS&P
shall reduce its right to representation on the board to one
Director.  As of December 11, 2002, the Company has received
approximately $1.3 million under the Debenture offering which
remains in escrow pending resolution of certain closing
conditions.  These conditions include (a) satisfactory
resolution of the Company's accounts payable presently
outstanding, (b) the grant of the security interest in form
satisfactory to each subscriber, (c) agreement by Dimeling,
Schreiber & Park Reorganization Fund II, L.P. to eliminate the
8% dividend on its Convertible common stock; and (d) agreement
by Dimeling, Schreiber & Park Reorganization Fund II, L.P., to
vote its shares in favor of the changes to the Articles of
Incorporation contemplated by the agreement.

The Company's financial statements have been prepared assuming
that it will continue as a going concern, however, the Company
has suffered net losses of $3,907,507 and $5,321,244 for the
three and nine months ended September 30, 2002, and its
operating activities used $750,211 of cash for the nine months
ended September 30, 2002.  Additionally, as of September 30,
2002, Chief Consolidated Mining had a working capital deficit of
$1,701,738 and an accumulated deficit of $34,536,105. These
matters raise substantial doubt about the Company's ability to
continue as a going concern.


CLAXSON INTERACTIVE: Strikes New Int'l TV Deal with Playboy Ent.
----------------------------------------------------------------
Playboy Enterprises, Inc., (NYSE: PLA PLAA) and Claxson
Interactive Group Inc., completed a new deal, which replaces
their joint venture, Playboy TV International, LLC. Under the
terms of the new agreements, PEI's equity in the venture's
international networks and television distribution outside of
Latin America and Iberia increases to 100% from 19.9% in return
for the release of Claxson from future library and programming
payments. Claxson and PEI will retain their existing 81%/19%
respective ownership splits in Playboy TV Latin America and
Iberia.

PTVI was created in 1999 as a joint venture between PEI and an
affiliate of the Cisneros Group, which in 2001 combined with
other entities to become Claxson. PEI owned 19.9% of the venture
with the option to buy up to 50%, while Claxson owned 80.1%.
PTVI's mission was to launch, own and operate Playboy TV
networks outside of the United States and Canada. Since its
formation, PTVI has launched 16 Playboy TV and movie networks in
36 countries. Today, these networks, combined with those that
PEI had launched prior to 1999, collectively reach approximately
34 million households.

As part of the original 1999 agreement, PEI was scheduled to
receive from PTVI $100 million primarily in international
television programming and trademark payments in exchange for
rights to its then existing library. Of the $100 million, $42.5
million has been paid to date with $57.5 million remaining
outstanding. In addition, through September 30, PEI also
received $34.2 million in quarterly payments as part of the
original PTVI long-term output agreement for the international
television rights to programming. Under the new arrangement,
these payments from PTVI to PEI will end, and Claxson will not
be required to fund the remaining capital contributions under
the original operating agreement.

Under the new agreements, PEI is assuming ownership of 27
networks in Europe and Asia. PEI said that even without the
programming payments, it expects the international TV business
to contribute positive cash flow in 2003. PEI also said that the
PTVI networks will be consolidated into its Entertainment Group
for financial reporting purposes.

Likewise, Claxson will obtain control over PTVLA's management
and will consolidate its operations into its Pay TV division for
financial reporting purposes. Going forward, PTVLA will consist
of the Playboy TV and movie networks in Latin America, Spain and
Portugal, including 100% of a local adult channel, Venus. PEI
will receive an annual license fee of 17.5% of PTVLA's revenues
with a guaranteed annual minimum in return for programming and
trademark rights.

Christie Hefner, chairman and chief executive officer of PEI,
said: "Our international TV networks have proven to be highly
successful and represent significant growth potential both in
existing territories where household penetration is only 10% now
and new countries."

Roberto Vivo, chairman and chief executive officer of Claxson,
said: "With this new agreement, Claxson solidifies its financial
position and continues to develop a long-term partnership with
one of the leading brands in the world. By combining our
expertise in managing Playboy TV in Latin America and Iberia
with PEI's brand awareness and programming expertise, we are
sure that we can continue to add value to both companies'
international operations."

Other terms of the agreement include the following:

      * PEI obtains 100% ownership of Playboy TV en Espanol, the
US Hispanic network reaching more than three million households,
paying a fee of 20% of U.S. Hispanic revenues for the PTVLA
feed;

      * Claxson returns to PEI its approximately 3% equity stake
in Playboy.com;

      * The two companies agree to restructure their Latin
American internet joint venture in favor of revenue share and
promotional agreements for their respective internet businesses
in Latin America.

      * The agreements are effective April 1, 2002.

Playboy Enterprises is a brand-driven, international multimedia
entertainment company that publishes editions of Playboy
magazine around the world; operates Playboy and Spice television
networks and distributes programming via home video and DVD
globally; licenses the Playboy and Spice trademarks
internationally for a range of consumer products and services;
and operates Playboy.com, a leading men's lifestyle and
entertainment Web site.

Claxson Interactive Group Inc., is a multimedia company
providing branded entertainment content targeted to Spanish and
Portuguese speakers around the world. Claxson has a portfolio of
popular entertainment brands that are distributed over multiple
platforms through its assets in pay television, broadcast
television, radio and the Internet. Claxson was formed on
September 21, 2001 in a merger transaction, which combined El
Sitio, Inc., and other media assets contributed by funds
affiliated with Hicks, Muse, Tate & Furst Inc., and members of
the Cisneros Group of Companies. Headquartered in Buenos Aires,
Argentina, and Miami Beach, Florida, Claxson has a presence in
all key Ibero-American countries, including without limitation,
Argentina, Mexico, Chile, Brazil, Spain, Portugal and the United
States.

As previously reported, Claxson's September 30, 2002 balance
sheet shows a total shareholders' equity deficit of about $14
million.


CLICKNSETTLE.COM: Fails to Comply with Nasdaq Listing Standards
---------------------------------------------------------------
clickNsettle.com, Inc., (Nasdaq: CLIK) the leading global
provider of innovative dispute resolution solutions, received a
Nasdaq Staff Determination on December 23, 2002, indicating that
the Company fails to comply with the minimum $2,500,000
stockholders' equity requirement for continued listing set forth
in Marketplace Rule 4310(C)(2)(B), and that its securities are,
therefore, subject to delisting from The Nasdaq SmallCap Market.
The Company intends to request a hearing before a Nasdaq Listing
Qualifications Panel to review the Nasdaq Staff Determination.
There can be no assurance the Panel will grant the Company's
request for continued listing.

Previously, on September 25, 2002, the Company received a letter
from the Nasdaq Staff that its common stock had failed to
maintain a minimum market value of publicly held shares of
$1,000,000. As a result, the Company has been provided 90
calendar days, or until December 24, 2002, to regain compliance.
The Company has not been able to regain compliance.
Additionally, on November 6, 2002, the Company received a letter
from the Nasdaq Staff that its common stock had failed to
maintain a minimum bid price of $1.00 over the previous 30
consecutive trading days. As a result, the Company has been
provided 180 calendar days, or until May 5, 2003, to regain
compliance.

Headquartered in Great Neck, New York, clickNsettle.com, Inc.,
provides dispute resolution services and software/web-enabled
tools designed to enhance and streamline the traditional and
often time-consuming and expensive legal process.
clickNsettle.com offers customized solutions built upon a
sophisticated technology platform that enables users to resolve
disputes more quickly and efficiently than ever before possible.
clickNsettle.com features a comprehensive suite of dispute
resolution tools and access to a network of approximately 1,500
highly qualified hearing officers in the United States and
abroad. clickNsettle.com provides an interactive portal of
communication and information between client and administrator.

                          *    *    *

                Liquidity and Capital Resources

In its SEC Form 10-QSB filed on November 14, 2002, the Company
stated:

"At September 30, 2002, the Company had a working capital
surplus of $1,589,721 compared to $1,833,092 at June 30, 2002.
The decrease in working capital occurred primarily as a result
of the loss from operations.

"Net cash used in operating activities was $129,618 for the
three months ended September 30, 2002 versus $172,325 in the
prior comparable period. Cash used in operating activities
principally declined due to a reduction in the loss from
operations which was offset by a decrease in non-cash charges
for advertising and changes in operating assets and liabilities.

"Net cash used in investing activities was $56,947 for the three
months ended September 30, 2002 versus net cash provided by
investing activities of $12,466 in the comparable prior period.
The change in cash from investing activities was primarily due
to a higher level of net purchases of marketable securities in
the current period.

"Net cash used in financing activities was $0 for the three
months ended September 30, 2002 versus $61,952 in the prior
comparable period. In the prior period, we purchased 28,567
shares of our common stock for an aggregate cost of $61,952.

"We have incurred net losses and had negative cash flow from
operations during the last six years and through September 30,
2002. Cash and cash equivalents arising principally from equity
transactions have provided sufficient working capital to fund
losses incurred and capital expenditures, as well as to provide
cash to redeem preferred stock outstanding and to purchase
treasury stock. As of September 30, 2002, we had $1,730,501 in
aggregate cash and cash equivalents. We believe that, through
the proper utilization of these existing funds, from revenue
generated from existing and new services and from expense
reductions achieved by streamlining operations through the
utilization of an enhanced processing system, we will have
sufficient cash to meet our needs over the next twelve months."


CMS ENERGY: S&P Affirms BB Rating on Pipeline Sale Announcement
---------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'BB' corporate
credit ratings on CMS Energy Corp., and subsidiary Consumers
Energy Co., following the announcement that Southern Union
Panhandle, a newly formed unit of Southern Union Co., and AIG
Highstar Capital L.P., will purchase CMS Panhandle Pipeline Cos.

At the same time, the rating on CMS Panhandle Pipeline was
placed on CreditWatch with positive implications, reflecting the
potential higher credit ratings dependent on the ultimate
financing strategy for Southern Union Panhandle. The outlook for
CMS Energy and Consumers Energy remains negative.

Michigan-based CMS Energy has about $7 billion in debt.

"The ratings affirmation for CMS Energy and Consumers Energy
reflects the company's dramatically improved liquidity position
due to the sale of its CMS Panhandle Pipeline unit for nearly
$1.8 billion, including the assumption of about $1.2 billion of
debt," said Standard & Poor's credit analyst William Ferara.

The Panhandle Pipeline sale will enable the company to
adequately meet about $1.3 billion of debt and bank facility
maturities in 2003. The sale is consistent with the company's
intent to improve its liquidity position and deleverage its
balance sheet by selling assets to bolster its financial
profile. CMS Energy should be able to continue its financial
improvement due to the recently announced sale of its natural
gas trading book, as well as through additional planned asset
sales. Once completed, the ultimate effect could be a
stabilization in the company's credit profile.

CMS Energy's key credit protection measures should benefit from
debt reduction and its refocused business strategy. On a
consolidated basis, adjusted funds from operations to average
total debt of about 15% and adjusted FFO interest coverage of
between 2.5x and 3x are slightly weak for current ratings.
However, these measures are expected to stabilize and modestly
improve over time. Adjusted debt leverage is expected to trend
down to near 60% when the company's debt-reduction goals are
met.

The negative outlook for CMS Energy and its subsidiaries
reflects challenges including executing additional planned asset
sales, maintaining an adequate liquidity position, restoring
investor confidence, and generating cash flow and reducing debt
sufficient enough to produce credit protection measures
commensurate for its current rating.


COMMUNICATION DYNAMICS: Panel Taps Young Conaway as Co-Counsel
--------------------------------------------------------------
The Official Committee of Unsecured Creditors of Communication
Dynamics asks for permission from the U.S. Bankruptcy Court for
the District of Delaware to hire Young Conaway Stargatt &
Taylor, LLP, as its co-counsel, nunc pro tunc to October 14,
2002.

The Committee previously sought permission to employ Paul,
Weiss, Rifkind, Wharton & Garrison as its lead counsel.  The
Committee explains that Young Conaway will assist the Committee
on matters relating to local custom and practice as well as the
general administration of these chapter 11 cases.  Paul Weiss
and Young Conaway has discussed an appropriate division of
responsibilities between them and will make every effort to
avoid any unnecessary duplication of effort.

In conjunction with Paul Weiss, Young Conaway will:

   a) advise and consult with the Committee concerning legal
      questions arising in administering the Debtors' estates,
      and the unsecured creditors' rights and remedies in
      connection with these cases;

   b) assist the Committee in preserving and protecting the
      Debtors' estates;

   c) consult with the Debtors on behalf of the Committee
      concerning the administration of the cases;

   d) prepare any pleading, motions, answers, notices, orders and
      any reports that are required for the protection of the
      Committee's interests and the orderly administration of the
      Debtors' estates; and

   e) perform any and all other legal services for the Committee
      that the Committee determines are necessary and appropriate
      to faithfully discharge its duties.

The attorneys and paralegals presently designated to represent
the Committee and their current standard hourly rates are:

           Pauline K. Morgan       $380 per hour
           Sharon M. Zieg          $240 per hour
           Alfred Villoch, III     $180 per hour
           Kimberly A. Beck        $110 per hour

Communication Dynamics, Inc., together with its Debtor and non-
Debtor affiliates, is one of the largest multinational suppliers
of infrastructure equipment to the broadband communications
industry. The Debtors filed for chapter 11 protection on
September 23, 2002.  Jeffrey M. Schlerf, Esq., at The Bayard
Firm, represents the Debtors in their restructuring efforts.
When the Company filed for protection from its creditors, it
listed more than $100 million both in estimated assets and
debts.


CONSECO INC: Taps Kirkland & Ellis as Lead Bankruptcy Counsel
-------------------------------------------------------------
Conseco Inc., Conseco Finance and their debtor-affiliates seek
the Court's authority to employ the law firm Kirkland & Ellis as
their lead counsel to prosecute their chapter 11 cases.

Kirkland's represented the Debtors pre-bankruptcy in connection
with their restructuring efforts.  In this process, Kirkland has
become familiar with the Debtors' business affairs and many of
the legal issues that may arise.  Accordingly, the Debtors
believe that Kirkland is both well qualified and uniquely able
to represent them in these Cases in an effective and efficient
manner.

Kirkland & Ellis is expected to:

   (a) advise the Debtors with respect to their powers and duties
       as debtors and debtors-in-possession in the continued
       management and operation of their business and properties;

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

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

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

   (e) take any necessary action on behalf of the Debtors to
       obtain confirmation of the Debtors' plan of
       reorganization;

   (f) represent the Debtors in connection with obtaining
       postpetition loans;

   (g) advise the Debtors in connection with any potential sale
       of assets;

   (h) appear before the Court, any appellate courts, and the
       U.S. Trustee, and protect the interests of the Debtors'
       estates before courts and the U.S. Trustee;

   (i) consult with the Debtors regarding tax matters; and

   (j) perform all other necessary legal services and provide all
       other necessary legal advice to the Debtors in connection
       with these Chapter 11 cases.

Subject to periodic adjustments -- and a planned firm-wide
increase on January 1, 2003 -- Kirkland & Ellis will bill United
for legal services at its customary hourly rates.  At the
beginning of 2002, those rates were:

            Position                   Hourly Rates
            --------                   ------------
            Partners                   $390 to $710
            Of-Counsel                 $270 to $685
            Associates                 $225 to $510
            Paralegals                  $55 to $215

Kirkland will also seek reimbursement for all other expenses
incurred in connection with the case including photocopying,
witness fees, travel expenses, filing and recording fees,
telecommunications, postage, messenger charges and other
expenses.

James H.M. Sprayregen, Esq., leads the engagement from Kirkland
& Ellis' offices in Chicago.  Mr. Sprayregen discloses that
Kirkland & Ellis received $9,020,000 for prepetition
restructuring services within the year prior to the Petition
Date.  K&E does not indicate how much of that amount, if any, is
held as a retainer.

Mr. Sprayregen assures that Court that Kirkland does not hold or
represent any adverse interest and that Kirkland is a
"disinterested person" as defined in Section 101(14) of the
Bankruptcy Code.  Out of an abundance of caution, Mr. Sprayregen
discloses that K&E also represents non-debtors Conseco Services,
LLC and Conseco Capital Management, Inc.  In the event any
matter adverse to the Debtors erupts in these cases, the Conseco
Debtors will be represented by lawyers at Baker & Daniels and
the Conseco Finance Debtors will be represented by lawyers at
Dorsey & Whitney.

Mr. Sprayregen tells the Court that Kirkland will continue to
review its files during these Chapter 11 proceedings to ensure
that no conflicts or other disqualifying circumstances arise.
(Conseco Bankruptcy News, Issue No. 2; Bankruptcy Creditors'
Service, Inc., 609/392-0900)

DebtTraders reports that Conseco Inc.'s 10.75% bonds due 2008
(CNC08USR1) are trading at about 11 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=CNC08USR1for
real-time bond pricing.


CONSOLIDATED FREIGHTWAYS: Court Fixes February 7 Claims Bar Date
----------------------------------------------------------------
The U.S. Bankruptcy Court for the Central District of
California, Riverside Division, established February 7, 2003, at
4:00 p.m., as the Claims Bar Date for creditors of Consolidated
Freightways Corporation and its debtor-affiliates to file their
proofs of claim or be forever barred from asserting those
claims.

An original proof of claim and one photocopy must be filed with
the Court.  If sent by U.S. Mail, the documents must be
addressed to:

       Consolidated Freightways
       Office of the Clerk
       U.S. Bankruptcy Court
       P.O. Box 872
       Riverside, California 92502

If by hand delivery or overnight mail, to:

       Consolidated Freightways
       Office of the Clerk
       U.S. Bankruptcy Court
       3420 Twelfth Street
       Riverside, California 92501

Proofs of Claim need not be filed if they are on account of:

       i. Claims not listed as contingent, unliquidated, or
          disputed;

      ii. Claims already properly filed with the Bankruptcy
          Court;

     iii. Claims previously allowed by Order of the Court;

      iv. Administrative claims but not including those claims
          related to freight delivery, which arose from the
          Petition Date through October 31, 2002;

       v. equity interests held by equity security holders.

                      Alternative Bar Dates

The Governmental Claims bar date is set for March 3, 2003.

Entities such as co-debtors, sureties and guarantors who are
authorized to file claims pursuant to 11 U.S.C. 501(b) and Rule
3005 of the Bankruptcy Court must file their proofs of claims by
March 7, 2003.

Holders of claims for the rejection of executory contracts or
unexpired leases must file their proofs of claim by the later
of:

       a. the Bar date; or

       b. 30 calendar days after the order approving the
          rejection of the contract was served.

Consolidated Freightways Corporation (Nasdaq:CFWY) is a
transportation company primarily providing LTL freight
transportation throughout North America using its system of 300
terminals. The Debtors filed for Chapter 11 protection on
September 3, 2002. Michael S. Lurey, Esq., at Latham & Watkins,
represents the Debtors in their restructuring efforts. As of
June 30, 2002, the Debtors listed total assets of about $783
million and total debts of about $791 million.


CONTINUCARE: Terminates One of Independent Practice Associations
----------------------------------------------------------------
Continucare Corporation (AMEX:CNU), intends to terminate the
Medicare and Medicaid lines of business for all of the physician
contracts associated with one of its Independent Practice
Associations. This initiative is intended to streamline our cost
structure and stem current as well as anticipated losses from
the division. Continucare's Staff Model and Home Health business
will be unaffected by these terminations. The termination will
take effect January 1, 2003.

The terminated IPA contributed approximately $9.5 million in
revenue annually to the company's total revenue for fiscal 2002
and was comprised of approximately 1,000 lives.

"[Thurs]day's announcement reaffirms our commitment to improving
and growing profitable lines of business while streamlining non
profitable lines of business from our operations," said Spencer
J. Angel, Continucare's chief executive officer.

Continucare Corporation, headquartered in Miami, Florida, is a
holding company with subsidiaries engaged in the business of
providing outpatient healthcare and home health services through
managed care, Medicare direct and fee for service arrangements,
in the Florida market.

                          *   *   *

                Liquidity and Capital Resources

Continucare's September 30, 2002 balance sheet shows that total
current liabilities exceeded total current assets by about $8
million.

In its SEC Form 10-Q filed on November 12, 2002, the Company
reported:

"Although our financial statements have been prepared assuming
we will continue as a going concern, there is a significant
uncertainty as to whether we will be able to fund our
obligations and satisfy our debt obligations as they become due
in Fiscal 2003. At September 30, 2002, the working capital
deficit was approximately $7,997,000, total indebtedness
accounted for approximately 93% of our total capitalization and
we had principal and interest of approximately $2,800,000
outstanding under the credit facility. Because our cash flow
from operations during the first quarter of Fiscal 2003 was not
sufficient to satisfy our debt obligations as they became due
and fund our capital expenditures, we funded our cash deficit by
drawing down the full amount available under the credit
facility. Prior to the end of the first quarter of Fiscal 2003,
we were able to repay a portion of the outstanding balance.
However, as of the date of this filing, we have again fully
drawn down the amount available under the credit facility. The
credit facility matures on March 31, 2003. We obtained this
credit facility in Fiscal 2000 based on the personal guarantee
of Dr. Phillip Frost and an entity controlled by Mr. Charles
Fernandez, former members of the board of directors.  Dr. Frost
and entities affiliated with Dr. Frost, owned approximately 50%
of our outstanding common stock as of September 30, 2002,
assuming conversion of stock options and a convertible
promissory note. Their guarantee is effective through the
March 31, 2003 maturity date. Based on our current cash flow
projections, it appears unlikely that we will have sufficient
funds available to fully repay the credit facility by March 31,
2003. While we intend to either extend or replace the credit
facility, either in whole or in part, uncertainty exists as to
whether we will be able to extend or replace the credit facility
without either the Guarantors extending their guarantee or other
individuals providing a personal guarantee. If personal
guarantees are required, there can be no assurance that we will
be able to obtain such guarantees. There can be no assurance
that we will be successful in our attempts to either repay,
extend or replace the credit facility and, if so, if this will
occur on terms acceptable to us."


CORRECTIONAL SERVICES: Sells Florence Arizona Facility for $10MM
----------------------------------------------------------------
Correctional Services Corporation (Nasdaq:CSCQ) announced the
sale of its 600 bed Florence Arizona facility to the Industrial
Development Authority of the County of Pinal. The Industrial
Development Authority financed the acquisition of the Florence
facility through the issuance of tax-exempt contract revenue
bonds. Debt service obligations under the contract revenue bonds
are special limited obligations and payable exclusively from the
revenues and receipts generated from the facility, and are not
guaranteed by the Company or the State.

The Company received approximately $10.0 million in gross
proceeds from the facility's sale. The net proceeds were used to
paydown the remaining balance under the Company's revolving
credit facility. The transaction included the sale of all of the
Company's interests in the facility's assets including its
property, plant and equipment.

The Company will continue to manage the facility having been re-
awarded its management contract with the Arizona Department of
Corrections. The new contract is for a base period of 10 years
with two five-year renewal options. The Company has managed the
facility since its opening in 1997. The facility provides 400
beds for specialized services to felony offenders convicted
under Arizona's DUI statutes and 200 beds for adult males
awaiting hearings for alleged parole violations.

James F. Slattery President and CEO stated: "I am very pleased
we were able to close this transaction which completes our plan
to sell the company's major real estate assets and use the
proceeds to eliminate our bank debt. Most important is that
after these facilities were sold the company continues to have
long term contracts to manage and operate the facilities." Mr.
Slattery further stated: "Our efforts this year to complete our
asset sale and debt reduction plan has been highly successful.
We continue to work towards improving facility contributions and
we expect to complete the analysis of under-performing
facilities by close of the 4th quarter. I am very please with
the positive momentum achieved this year and look forward to
continued improvement in 2003!"

Through its Youth Services International subsidiary, the Company
is the nation's leading private provider of juvenile programs
for adjudicated youths with 23 facilities and 3,400 juveniles in
its care. In addition, the Company is a leading developer and
operator of adult correctional facilities operating 12
facilities representing approximately 4,500 beds. On a combined
basis, the Company provides services in 15 states and Puerto
Rico, representing approximately 7,900 beds including aftercare
services.

                            *    *    *

                 Liquidity and Capital Resources

In its SEC Form 10-Q file on November 14, 2002, the Company
reported:

"At September 30, 2002 the Company had $759,000 of cash and
working capital of $8.2 million compared to December 31, 2001
when the Company had $932,000 in cash and a working capital
deficit of $7.9 million. The increase in working capital is
primarily related to the decrease in the Company's senior debt
and the refinancing of the debt on a non-current basis.

"At September 30, 2002 the Company had $3.2 million outstanding
under the amended revolving line of credit, and $6.2 million in
availability.

"At September 30, 2002 the Company had $13.3 million outstanding
under the amended operating lease-financing facility, and has no
availability on this facility. The Company had no construction
commitments at September 30, 2002; however, the Company is
pursuing projects that will require additional funding. There
can be no assurances that the Company will be awarded these
projects, or if awarded, that the Company will be able to obtain
such funding. The Company has made non-refundable deposits of
approximately $430,000 in pursuit of one of the projects
mentioned above. The Company was awarded this project in July
2002; however, there can be no assurances that the Company will
be able to obtain financing to fund this project.

"The amended financing agreements matured on October 30, 2002,
at which time the Company entered into a new long-term financing
agreement. The new agreement is subject to compliance with
various financial covenants and borrowing base criteria. The new
agreement is secured by all of the assets of the Company and
consists of the following components:

      *   A $12 million term loan that matures on October 30,
2004, accrues interest at the lesser of LIBOR plus 5% or prime
plus 3%, with monthly principal payments of $50,000 plus
interest and a balloon payment of approximately $10.8 million
due upon maturity. The proceeds were used to primarily satisfy
the Company's obligation under its operating lease-financing
facility, which became due November 15, 2002. Concurrent with
the satisfaction of the operating lease-financing obligation,
the associated assets were recorded on the Company's financial
statements;

      *   A $19 million revolving line of credit that matures on
October 30, 2005, and accrues interest at the lesser of LIBOR
plus 4.0%, or prime plus 2.0%. As of October 30, 2002, the
Company had approximately $3.5 million of availability.

"On July 31, 2002, the Company entered into a transaction with a
not-for-profit entity with respect to the Company's Phoenix,
Arizona facility and received approximately $8.5 million from
the issuance of tax-exempt contract revenue bonds, issued by the
Industrial Development Authority of Maricopa County, Arizona.
The bondholders have a security interest in the facility. The
bonds will be paid exclusively from revenue generated by the
facility, and are non-recourse to the Company. The Company used
the proceeds to reduce the balance of its revolving line of
credit facility. In conjunction with the transaction, the State
of Arizona has an option to purchase the facility for an initial
purchase price of $8.5 million. The State's option price will
decline over time. In the event that the State exercises its
option, there may be a shortfall between the proceeds of the
sale and the funds needed to redeem the bonds. The Company has
provided to the bondholders a letter of credit, secured by a
certificate of deposit, which would be utilized to fund the
aforementioned shortfall, if any. The letter of credit has an
initial balance of $1.4 million and decreases over time as the
calculated difference between the sale proceeds that would be
due from the State and the unpaid principal balance of the bonds
narrows. After 2010, the sale proceeds from the State would be
sufficient to satisfy the redemption requirement. The Company
will continue to operate the facility under a management
agreement through 2012, subject to two five-year renewal
options, exercisable by the State. Due to the Company's
continuing involvement in the operation of the facility, and its
partial guarantee of the redemption proceeds by virtue of the
letter of credit, the Company has not recorded the transaction
as a sale in accordance with SFAS No. 66, Accounting for Sales
of Real Estate and SFAS No. 98 Accounting for Leases. The book
value of the facility in the amount of $8.6 million net of
accumulated depreciation of $2.1 million continues to be
reflected in the Company's financial statements. The Company has
also recorded a long-term obligation equal to the net proceeds
from the transaction of $8.4 million. Upon the earliest
occurrence of either 1) the State exercising its purchase
option, 2) the expiration or termination of the Company's
management agreement with the State or 3) when conditions exist
such that the transaction is deemed to have been a sale in
accordance with the generally accepted accounting principles, as
discussed above, the sales transaction will be reflected in the
financial statements and a gain of approximately $1.9 million
will be recorded.

"The Company has plans to sell a facility to its contracting
agency. The proceeds from the sale are expected to reduce the
Company's senior debt obligation by approximately $12.5 million.
The Company also expects to sell another facility to its
contracting agency over the next 6 to 12 months. The Company
expects to continue operating the facility through a management
agreement. There can be no assurances that the Company will be
successful in its negotiations to sell the facilities. The
assets owned by the Company will only be sold upon certain
conditions being met, and are not generally marketed for sale.
Accordingly, the assets are not classified as held for sale.

"The Company expects to continue to have cash needs as it
relates to financing start-up costs in connection with new
contracts that would improve the profitability of the Company.
There can be no assurances that the Company's operations
together with amounts available under its expected financing
facility will continue to be sufficient to finance its existing
level of operations, fund startup costs and meet its debt
service obligations. Also, a decline in the Company's financial
performance, as a result of decreased occupancy or increases in
operational expenses could negatively impact the Company's
ability to meet its financial covenants. If the Company is
unable to generate sufficient cash flow from operations or meet
its covenant requirements, it may be required to amend or
restructure its financing facility, sell additional assets or
obtain additional financing. There can be no assurance that the
Company will be able to obtain amendments to the financing
facility, sell additional assets or obtain additional
financing."


COX TECHNOLOGIES: Net Capital Deficit Widens to $2.4M at Oct. 31
----------------------------------------------------------------
Cox Technologies, Inc., (COXT.OB) reported an improvement in
cash flow for the first six months of fiscal 2003 as compared to
the same period in fiscal 2002.

Cash flow in fiscal 2003 improved as a result of the strategic
restructuring and cost cutting measures implemented during
fiscal 2002 and to the sale of the oilfield subleases on
September 30, 2002. For the first six months of fiscal 2003,
cash flow from operating activities increased to $43,000 as
compared to a negative cash flow of $363,500 for the same period
in fiscal 2002.

The net loss of $128,200 for the first six months of fiscal 2003
reflected a $755,200 improvement as compared to the net loss of
$883,400 for the same period last year. The net loss for the
three months ended October 31, 2002 was $209,800 as compared to
a net loss of $340,700 for the three months ended October 31,
2001.

At October 31, 2002, Cox Technologies' balance sheet shows a
total shareholders' equity deficit of about $2.4 million.

Dr. James L. Cox, Chairman, President and Chief Executive
Officer stated, "During the first six months of fiscal 2003, we
continued to realize benefits from our restructuring and cost
cutting measures. Cash flow continues to improve and we are
pleased with the decreased level of operating expenses as
compared to fiscal 2002. Operationally, sales in units of the
Cox1 graphic recorder decreased 14%, but the sale in units of
the DataSource(R) electronic data logger increased 72% for the
six months ended October 31, 2002 as compared to the same period
last year." Dr. Cox further stated, "Although revenues from the
sale of Cox1 graphic recorders decreased to 72% of total
revenues in the first six months of fiscal 2003 as compared to
85% in the same period last year, our redirected marketing focus
to pursue sales in electronic data logger products resulted in
revenues from the sale of these products increasing to 22% of
total revenues in the first six months of fiscal 2003 as
compared to 14% in the same period last year."

Jack G. Mason, Chief Financial Officer stated, "I am pleased
with the positive cash flow from operating activities during the
first six months of fiscal 2003. Overall, cash decreased $53,600
as a result of the Company paying an additional $240,000 of
principal on the loans with RBC Centura Bank during the period.
The decrease in operating expenses as compared to last year
reflects our commitment to manage expenses while returning to
profitability and generating positive cash flow during fiscal
2003." Mr. Mason added, "The Company recently executed documents
with Centura to extend the maturity dates of our loans to March
15, 2003. We are in the process of raising a minimum of
$450,000, in either equity or debt capital, to pay additional
principal on those loans which will allow us to extend the
maturity dates even further."

Sales revenues for the six months ended October 31, 2002
decreased 3%, or $115,900, as compared to the prior year period,
primarily due to a decrease in Cox1 product sales and a decrease
in average sales price for all products due to increased
competition in the industry, partially offset by an increase in
electronic data logger product sales. The cost of sales for the
first six months of fiscal 2003 decreased 12%, or $344,500, as
compared to the prior year period. This decrease is due to a
decrease in labor and benefits costs, supplies used in the
manufacturing process and a reduction in the price of raw
material components, offset slightly by increased repair and
maintenance expenses and retriever fees.

General and administrative expenses decreased 20%, or $280,300,
and selling expenses decreased 27%, or $201,400, in the first
six months of fiscal 2003 as compared to the same period last
year. The decreases are primarily related to a decrease in labor
and benefits costs and legal fees, partially offset by an
increase in insurance and outside services.

Cox Technologies is engaged in the business of producing and
distributing transit temperature recording instruments, both
domestically and internationally. The Cox1 graphic recorder and
the DataSource(R) and Tracer(R) electronic data loggers are
marketed under the trade name Cox Recorders and produce a record
that is documentary proof of temperature conditions.


CTC COMMUNICATIONS: Gets Nod to Hire CXO as Turnaround Manager
--------------------------------------------------------------
CTC Communications Group, Inc., and its debtor-affiliates sought
and obtained permission from the U.S. Bankruptcy Court for the
District of Delaware to retain and employ CXO, L.L.C., as their
crisis and turnaround manager.

The Debtors relate that CXO has been CTC's principal advisor
with respect to all issues concerning its restructuring since
September 3, 2002.  CXO has been advising CTC with respect to
issues related to its financial distress and Michael
Katzenstein, one of CXO's principals, subsequently assumed the
role of Chief Executive Officer to direct CTC's restructuring in
mid-September, 2002. Since that date, CXO has assumed
responsibility for executive management of CTC.

CXO continues to coordinate all CTC efforts regarding its
Chapter 11 filings and related activities. CXO negotiated the
cash collateral order with CTC's senior secured lenders and is
negotiating service continuation arrangements with all major
telecommunications carriers. CXO reached an interim service
continuation agreement with Verizon, CTC's largest
telecommunications carrier and largest unsecured creditor.

To the best of CTC's and CXO's knowledge, CXO has no actual
conflict or materially adverse interest to the Debtors and their
estates in connection with the matters for which CXO is to be
employed.

CXO is expected to provide crisis and turnaround management
services to CTC, including:

   a. Michael E. Katzenstein, a principal of CXO, will serve as
      interim chief executive officer of CTC during the term of
      the engagement and other CXO representatives will, upon
      written request of the Board, serve in executive officer
      positions with CTC, each without further compensation.

   b. Advise and assist CTC in developing and executing business
      restructuring solutions, as well as provide day-to-day
      management of the company and direct oversight of employees
      and officers;

   c. Provide oral and written reports to the Board, as may be
      requested by the Board, and participating in meetings with
      some or all of the Board members;

   d. Advise and assist CTC In evaluating, renegotiating and
      restructuring its personal property leases, as well as in
      evaluating its unexpired real property leases and executory
      contracts in connection with the assumption or rejection;

   e. Assist CTC with respect to oversight of third-party service
      providers;

   f. Communicate and report to the Prepetition Lenders, the
      Committee (once appointed) and their respective
      professionals on matters related to financial reporting,
      contract compliance and asset dispositions;

   g. Provide expert advice and expert testimony on matters
      related to the reorganization, and on any other matter as
      to which CTC is rendering services hereunder,

   h. Assist on a part-time basis in the completion of the sale
      of business units, which are in the advance stages of
      negotiation;

   i. Assist CTC in the preparation of its bankruptcy schedules
      and statements of financial affairs; and

   j. Render such other interim management or turnaround
      consulting services as may be mutually agreed to by CTC and
      CXO.

Compensation will be payable to CXO on a daily basis:

           Principal           $4,000 per day
           Director            $2,500 per day
           Associate           $1,500 per day

CTC Communications Group, Inc., a source provider of voice,
data, and Internet Communications services to medium and larger
sized business customers, filed for chapter 11 protection on
October 3, 2002. Pauline K. Morgan, Esq., at Young, Conaway,
Stargatt & Taylor, represents the Debtors in their restructuring
efforts. When the Company filed for protection from its
creditors, it listed $306,857,985 in total assets and
$394,059,938 in total debts.


DENBURY RESOURCES: Provides Update on Drilling Operations
---------------------------------------------------------
Denbury Resources Inc., (NYSE:DNR) gave an update on certain of
its drilling results.

                    North Padre Island Discovery

The Company has drilled and logged its initial well at North
Padre Island Block A-9, offshore Texas and based on initial
internal estimates, believes that it has made a new field
discovery with total potential gross natural gas reserves of
approximately 90 Bcf (34 Bcf net to the Company). The Company is
currently in the process of reviewing this well data with its
independent engineers as part of the preparation of its year-end
reserves, but anticipates that little, if any, of these reserves
will be proven at year-end primarily due to the lack of
production flow tests. Positive results from future wells, flows
tests and production results will be required in order to
classify these potential natural gas reserves as proven. None of
this testing is expected until late 2003.

The Company is expected to spud its second well in this field in
a different fault block within the next week which, if
successful, could add an additional 35 Bcf of gross reserve
potential (13 Bcf net). This second well should reach total
depth by late January. There may also be additional wells
drilled in this field in late 2003 or during 2004 to test other
additional potential in this block. The production facilities
necessary to produce any reserves in this block are not expected
to be installed until late 2003.

                    New CO2 Well on Production

The Company has recently put the first CO2 well it has drilled,
the Denkmann #1, on production at initial rates up to 22 million
cubic feet of CO2 per day, bringing the Company's total CO2
production capacity to about 140 million cubic feet of CO2 per
day. The Company expects to further increase the production rate
on this well in early 2003 to production rates as high as 30
million cubic feet per day. The Company's second CO2 well, the
IP 15-4, is currently drilling at approximately 14,800 feet,
with two additional CO2 wells scheduled for 2003.

                       Natural Gas Hedges

Separately, the Company announced that as part of its regular
hedging program it has recently hedged natural gas for calendar
2005 in the form of a no-cost natural gas collar for 15 MMcf/d,
consisting of a price floor of $3.00 per MMBtu and an average
price ceiling of $5.50 per MMBtu. Although the Company has not
completed its production forecast for 2005, it expects that this
hedge will cover between 10% and 15% of its anticipated 2005
natural gas production.

Denbury Resources Inc. -- http://www.denbury.com-- is a growing
independent oil and gas company. The Company is the largest oil
and natural gas operator in Mississippi and holds key operating
acreage onshore Louisiana and in the offshore Gulf of Mexico.
The Company increases the value of acquired properties in its
core areas through a combination of exploitation drilling and
proven engineering extraction practices.

                            *   *   *

As previously reported, Standard & Poor's raised the corporate
credit rating on Denbury Resources Inc., to double-'B'-minus
from single-'B'-plus and revised its outlook to stable from
positive.

The upgrade on Denbury's corporate credit rating reflects:

      -- Management's continuing maintenance of leverage that is
consistent with the double-'B' rating category; since the severe
industry downturn of 1998-1999 when Denbury's financial
resources were strained, the company has operated with a more
disciplined financial philosophy, including protecting cash
flows with commodity price hedges, when appropriate.

      --Expected improvement in the company's financial profile
resulting from likely elevated oil prices in 2002.

      --Expectations for prudent reinvestment of upcycle cash
flows. --Good production growth during the next two years from
Denbury's long lead-time development projects in Mississippi,
which will further enhance the company's debt-service capacity.


DENNY'S CORP: S&P Assigns BB- Senior Secured Bank Loan Rating
-------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB-' senior
secured bank loan rating to family dining restaurant operator
Denny's Corp.'s $125 million senior secured revolving credit
facility. The new facility will be used to refinance the
existing credit facility.

At the same time, Standard & Poor's raised its corporate credit
rating on the company to 'B' from 'B-'. The outlook is stable.
Spartanburg, South Carolina-based Denny's had total debt of $606
million as of September 25, 2002.

"The upgrade is based on the successful refinancing of the
company's credit facility which eliminated a significant near-
term concern, said Standard & Poor's credit analyst Robert
Lichtenstein.

The ratings on Denny's reflect the challenges of improving the
operations of Denny's restaurants amid a highly competitive
restaurant industry, the company's weak cash flow protection
measures, and its significant debt burden. These risks are
somewhat offset by the company's relatively well-known brand
name and regional market position.

Comparable-store sales in the first nine months of 2002 declined
by 0.7% after rising 2.7% in all of 2001. The company's
operating margin for the 12 months ended September 25, 2002,
increased to 18.5% from 16.3% in the same period of 2001. The
improvement was due to the closure of underperforming stores, a
higher percentage of franchised units in its system, and lower
product and utility costs. The company has sold more than 200
company-owned units to franchisees since 2000 and, in the
future, will refranchise units on a limited basis.

The stable outlook reflects Denny's improved liquidity position
after refinancing its credit facility, paying down debt from the
proceeds of the divestiture of FRD Acquisition, and
refranchising. Still, the company's highly leveraged capital
structure and the challenge of improving operations in the
competitive restaurant industry could hinder progress.


DIAMOND BRANDS: Del. Court Sets January 29 Confirmation Hearing
---------------------------------------------------------------
A hearing to consider confirmation of the Reorganization Plan
proposed by Diamond Brands Operating Corp., and its debtor-
affiliates, will convene in the U.S. Bankruptcy Court for the
District of Delaware on January 29, 2002, before the Honorable
Randall J. Newsome.

The Bankruptcy Court also fixes January 22, 2003, at 4:30 p.m.,
as the last day for filing objections to the Debtors' Plan.

Jarden Corporation (NYSE: JAH) will purchase Diamond's business
assets and certain liabilities of Diamond Brands Operating Corp.
and its affiliates under the proposed Plan.  The net value of
the transaction is approximately $90 million.  The acquisition
is expected to close by the end of January 2003, subject to
final confirmation by the Bankruptcy Court, Hart-Scott-Rodino
approval, execution of a definitive purchase agreement and other
customary closing conditions.

The acquisition will increase Jarden's revenue base by
approximately $100 million while adding the well-known Diamond
Brands(R) and Forster(R) trademarks to its existing brands.
Jarden is a leading provider of niche consumer products used in
home food preservation.  Jarden's consumer products group is the
U.S. market leader in home vacuum packaging systems and
accessories, under the FoodSaver(R) brand and home canning and
related products, primarily under the Ball(R), Kerr(R) and
Bernardin(R) brands.  Jarden's materials based group is the
country's largest producer of zinc strip and manufactures
plastics parts for other equipment manufacturers.  Furthermore,
Diamond Brands will provide a new family of products that are
sold through similar distribution channels.

Diamond Brands, based in Cloquet, MN, employs approximately 600
people and is a leading manufacturer and marketer of niche
consumer products for domestic use including matches,
toothpicks, disposable plastic cutlery, straws, clothespins and
wooden crafts, sold primarily under the Diamond Brands and
Forster trademarks. The company filed for Chapter 11 protection
on May 22, 2001. Timothy R. Pohl, Esq., Gregg M. Galardi, Esq.,
and Patricia A. Widdoss, Esq., at Skadden, Arps, Slate, Meagher
& Flom, represent the Debtors in their restructuring efforts.


EEL RIVER SAWMILL: State Takes Over Workers Compensation Program
----------------------------------------------------------------
California Department of Industrial Relations Acting Director
Chuck Cake ordered the state's Self Insurers' Security Fund to
take over payment of Eel River Sawmill's workers' compensation
claims following the company's default on payment of benefits.

Eel River Sawmill, self insured since 1980, advised California's
Self Insurance Plans Dec. 10 that it was defaulting because it
was unable to pay benefits on its remaining self-insured
workers' compensation liabilities.

"Employees receiving workers' compensation benefits for
workplace injuries are first protected from a self-insured
company's inability to pay benefits with a security deposit
employers are required to post," said SIP manager Mark Ashcraft.
"The second protection is the Security Fund's guarantee to pay
all benefits due that exceed the deposit posted. Eel River
Sawmill defaulted on benefit payments so we turned their
security deposit and workers' compensation liabilities over to
the Security Fund, which will ensure continued benefit payments
to injured workers."

As a result of an audit, SIP found the company understated its
liability on 142 open indemnity claims by $2,159,824 and had a
total remaining liability on its worker's compensation claims
estimated at $7,021,506.

Eel River Sawmills operated a lumber sawmill and power
generation plant in Fortuna. The sawmill closed a year ago
leaving workers' compensation claims, which were being paid by
proceeds from the power plant. The power plant is now closing.

The Security Fund is a private, nonprofit mutual benefit
corporation that guarantees the payment of all self-insured
workers' compensation claims in California. The state has one of
the largest workers' compensation self-insurance programs in the
nation. Employers choose to self insure their workers'
compensation liabilities because of cost effectiveness, greater
control over their claims program, and increased safety
incentives that come with improved loss-control results.

For more information on self-insurance, visit
http://www.dir.ca.gov/SIP/


EGAIN COMMS: Secures Additional Credit Line of Up to $5 Million
---------------------------------------------------------------
eGain Communications Corporation (Nasdaq:EGAN), a leading
provider of knowledge-powered customer service software and
services for the Global 2000, announced that its co-founder and
CEO, Ashutosh Roy, has extended a $5 million credit facility to
the company. This facility includes a $2 million initial loan,
followed by additional loans of up to $3 million subject to the
company meeting certain performance milestones.

"Calendar 2002 has been all about reaching breakeven and
developing our next-generation 6.0 product suite," said Mr. Roy.
"I am proud of the progress the eGain team has made towards
achieving these goals, while right-sizing the business to
operate effectively in a demanding economic environment.
Calendar 2003 will continue to be a year of focused execution -
we will seek prudent growth built on a platform of
differentiated product offerings and sustained customer
satisfaction. This credit line strengthens our balance sheet and
further validates our confidence in eGain."

eGain (Nasdaq:EGAN) is a leading provider of software and
services that enable knowledge-powered multi-channel customer
service. Selected by 24 of the 50 largest global companies to
transform their traditional call centers into knowledge-powered
multi-channel contact centers, eGain solutions measurably
improve operational efficiency and customer retention,
delivering a significant ROI. eGain eService Enterprise, the
company's software suite, also available as a hosted service,
includes applications for knowledge management, web self-
service, email management, and web collaboration, as well as
certified integrations with existing call center infrastructure
and business systems. Additionally, eGain offers a comprehensive
set of professional services including business consulting,
implementation services, 24x7 support, education, and training.

Headquartered in Sunnyvale, California, eGain has an operating
presence in 18 countries and serves over 800 enterprise
customers worldwide, including ABN AMRO, DaimlerChrysler, and
Vodafone. Visit http://www.eGain.comfor more information on the
Company.

At September 30, 2002, eGain's balance sheets show a working
capital deficit of about $2.7 million, while total shareholders'
equity further dwindled to about $9 million from $15 million at
June 30, 2002.


ENCOMPASS SERVICES: Court Grants Priority on Postpetition Goods
---------------------------------------------------------------
Encompass Services Corporation and its debtor-affiliates
obtained the Court's approval granting their vendors
administrative expense priority status for the undisputed
obligations arising from the Outstanding Orders that are
delivered subsequent to the Petition Date; and authorizing them,
in their sole discretion in the exercise of their business
judgment and in accordance with their customary business
practices, to satisfy those undisputed obligations to the
vendors in the ordinary course of business.

The Debtors believe that they have $24,000,000 in undisputed
obligations to the vendors arising from the Outstanding Orders.
As of the Petition Date, Encompass Services Corporation and
debtor-affiliates had numerous pending outstanding orders for
materials, supplies, goods, products and related items from
their vendors.  But as a result of their Chapter 11 filing, the
Debtors believe that many of the vendors may be concerned that
the postpetition delivery or shipment of goods with respect to
prepetition purchase orders will render the vendors general
unsecured creditors of the Debtors' estates. (Encompass
Bankruptcy News, Issue No. 3; Bankruptcy Creditors' Service,
Inc., 609/392-0900)


ENRON CORP: Faulconer Demands Payment of $8-Million Admin. Claim
----------------------------------------------------------------
Vernon E. Faulconer, Inc., asks the Court to compel Enron North
America Corporation to pay its administrative expense claim for
$8,082,832, pursuant to Section 503 of the Bankruptcy Code.

Aaron R. Cahn, Esq., at Carter Ledyard & Milburn, in New York,
relates that ENA and Faulconer entered into a Master Agreement
dated May 17, 2001, which established operating procedure
relating to transactions in existence, as well as those
contemplated to come into existence.  Each transaction would be
evidenced by a Confirmation.  Under the terms of the Master
Agreement, the Confirmation, as to each particular transaction,
establishes the fixed price and the method and date of
calculation of the market price, as well as the date of payment.

There are six pertinent Confirmations.  Confirmation Number
V64627.1 and V81043.1 terminated under their own terms on
December 31, 2001.  Confirmation Number VN9436.1 terminated
under its terms in July of 2002.  Still in full force and effect
are Confirmation Numbers V64627.2, V81042.1 and VT9200.1.

Mr. Cahn explains that in the ordinary course of its business,
ENA established a business model in which it would enter into
contracts with natural gas users who had vested interests in
eliminating the risk of market fluctuations in the price of
natural gas, which would adversely affect the users' cost.  In
each Determination Date, ENA would forward to Faulconer
settlement invoices reflecting the net obligations of the
parties under the terms of the transactions.  Under these
transactions, $8,082,832 is due from ENA for the period
December 5, 2001 through October 7, 2002.

Mr. Cahn relates that Faulconer has continued to comply with all
of its obligations and responsibilities under the Master
Agreement and has continued its contractual obligations to pay
the monies owed to ENA should the market price of natural gas
exceed the fixed price under any of the Confirmations.  Also,
postpetition, ENA continued to implement and carry its business
model and reaped risk-fee income under the Master Agreement,
except to pay the net proceeds due under the Master Agreement.

Thus, Mr. Cahn asserts, ENA should pay the owed amount as an
administrative expense of the estate.

In the alternative, Faulconer suggests that any amount of the
administrative claim not determined to be a proper
administrative claim should be recognized as a prepetition
unsecured claim pursuant to Section 503(b)(1)(A) of the
Bankruptcy Code. (Enron Bankruptcy News, Issue No. 51;
Bankruptcy Creditors' Service, Inc., 609/392-0900)

DebtTraders reports that Enron Corp.'s 9.875% bonds due 2003
(ENRN03USR3) are trading at about 13 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=ENRN03USR3
for real-time bond pricing.


EOTT ENERGY: Court to Consider Chapter 11 Plan on January 30
------------------------------------------------------------
On the same day EOTT Energy Partners, L.P. filed its Third
Amended Disclosure Statement and Plan of Reorganization, Judge
Schmidt approved the Disclosure Statement, finding that it
contains sufficient information to enable claimants or equity
interest holders to make an informed judgment concerning the
Plan.  The Court overruled all objections to the Disclosure
Statement that were not voluntarily withdrawn.

Furthermore, Judge Schmidt approved the Debtors' Solicitation
Materials, which may include a solicitation letter from the
Official Committee of Unsecured Creditors supporting the Plan.

The Confirmation hearing to consider the merits of the company's
plan will be conducted on January 30, 2003, at 10:00 a.m.,
Central Standard Time.  The last day to file and serve written
objections to confirmation of the plan is January 23, 2003, at
4:00 p.m., Central Standard Time.

The Solicitation Package will be composed of these documents:

         -- a copy of this Order;

         -- the Disclosure Statement and Plan;

         -- an appropriate form of ballot;

         -- the solicitation letter from the Debtors;

         -- if applicable, the solicitation letter from the
            Committee; and

         -- a postage-prepaid return envelope;

December 6, 2002 is the "Voting Record Date" for purposes of
establishing the holders of the $235,000,000 aggregate principal
amount of 11% Senior Notes due 2009 and holders of Class 7.1A
Common Units entitled to vote on the Plan.

The Voting Deadline to accept or reject the Plan is January 23,
2003 at 3:00 p.m., Central Standard Time. (EOTT Energy
Bankruptcy News, Issue No. 7; Bankruptcy Creditors' Service,
Inc., 609/392-0900)


FEDERAL-MOGUL: Appoints Aon to Manage Employee Stock Programs
-------------------------------------------------------------
Federal-Mogul Corporation has appointed Aon Fiduciary
Counselors, Inc., as its independent fiduciary to manage the
Federal-Mogul Common Stock Fund, the Federal-Mogul Corporation
Series C ESOP Convertible Preferred Stock.  Both funds are
investment options in one or more of Federal-Mogul Corporation's
employee-related plans:

  (i) the Federal-Mogul Corporation Employee Investment Program;

(ii) the Federal-Mogul Corporation Salaried Employees'
      Investment Program; and

(iii) as of December 9, 2002, the Federal-Mogul Corporation
      401(k) Investment Program.

The appointment became effective December 2, 2002.

Pursuant to a Schedule 13G filed by AON with the Securities and
Exchange Commission, AON reported that Federal-Mogul has amended
the Plans to confer on it the full authority, inter alia, to:

   -- continue to offer either Fund (as relevant) as an
      investment option under the Plan on the terms and
      conditions as AON deems prudent and in the interest of the
      Plan and its participants and beneficiaries, including
      without restriction prohibiting or limiting (e.g., as a
      percentage of a participant's account) further purchases or
      holdings of Fund units or increasing the Common Stock
      Fund's holding of cash or cash equivalent investments;

   -- terminate the availability of either Fund (as relevant) as
      an investment option under the Plan on the terms and
      conditions as AON will deem prudent and in the interest of
      the Plan and its participants and beneficiaries (and
      notwithstanding any participant or beneficiary investment
      directions to the contrary), including determining the
      manner and timing of termination of the Fund and the
      orderly liquidation of its assets and designation of an
      alternative investment fund from among those already
      available for the investment of the proceeds pending
      further investment directions of the Plan's participants
      and beneficiaries; and

   -- convert or not to convert shares of Preferred Stock held in
      the Preferred Stock Fund into Common Stock, and on a
      conversion, thereafter to act with respect to the Common
      Stock in the same manner as under the Common Stock Fund.
      Under the terms of the Plans, the dividends paid on the
      Common Stock held by the Funds, if any, are generally
      reinvested and used to buy additional shares of Common
      Stock.

AON further stated that the participants in the Plans are
allowed to provide confidential directions on how the shares of
Common Stock attributable to their accounts should be voted or
tendered.

AON and its parent company, AON Corporation, disclaimed any
beneficial ownership of:

   (a) the 11,312,396 shares of Common Stock -- assuming
       conversion in full of the Preferred Stock; and

   (b) the 439,937 shares of Preferred Stock pursuant to Exchange
       Act Rule 13d-4.

AON ascertained that it does not have any economic interest in
the shares of Common Stock held by the Plans.  Each Plan
participant has the power to direct the receipt of dividends
from, or the proceeds from the sale of, the shares of Common
Stock held in that participant's account subject to the
fiduciary powers of AON.  In addition, each participant has sole
voting power over the Common Stock held in that participant's
account. To AON's knowledge:

   (a) no participant has any of the foregoing rights with
       respect to more than five percent of the Federal-Mogul's
       Common Stock; and

   (b) there is no agreement or understanding with AON
       Corporation to act together for purposes of acquiring,
       holding, voting or disposing of any the shares.

A copy of the Schedule 13G filing is available at no extra
charge at the SEC:

http://www.sec.gov/Archives/edgar/data/34879/000089968102000458/federal-13g_121102.htm


(Federal-Mogul Bankruptcy News, Issue No. 28; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


FOCAL COMMS: S&P Drops Rating to D After Bankruptcy Filing
----------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Focal Communications Corp., to 'D' from 'CC' following
the company's filing of a voluntary, prenegotiated Chapter 11
bankruptcy petition on December 19, 2002. The ratings were
removed from CreditWatch.

As of September 30, 2002, Chicago, Illinois-based Focal had
total debt outstanding of about $489 million, including about
$109 million of convertible notes.

The company is an integrated communications service provider
that offers voice and data services to large enterprise and
Internet service provider customers in 23 metropolitan markets.

The company has reached an agreement with its senior bank
lenders and senior secured convertible noteholders, whereby the
senior secured convertible notes will be exchanged into new
common equity and $65 million of redeemable preferred equity,
and the company will prepay $15 million under its senior secured
bank credit facility. Focal is targeting the first half of 2003
for emergence from Chapter 11.

Focal Communications' 12.125% bonds due 2008 (FCOM08USR1) are
trading at about a penny on the dollar, DebtTraders says. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=FCOM08USR1
for real-time bond pricing.


GENUITY INC: Signs-Up Baker & McKenzie as Special Counsel
---------------------------------------------------------
Genuity Inc., and its debtor-affiliates request authority to
employ Baker & McKenzie, nunc pro tunc to the Petition Date, to
serve as Special Counsel focused on global telecommunications
law issues.

Sally McDonald Henry, Esq., at Skadden, Arps, Slate, Meagher &
Flom, in New York, explains that the Debtors have selected Baker
as their Special Counsel because of the firm's prepetition
experience with and knowledge of the Debtors and their
businesses, as well as its experience and knowledge in the field
of international corporate, securities and tax matters.  The
Debtors submit that continued representation of the Debtors by
Baker is critical to the success of the Debtors' reorganization
because Baker is uniquely familiar with the Debtors' business
and legal affairs.

According to Ms. Henry, Baker has performed extensive legal work
for the Debtors since 19998 in connection with certain
corporate, securities, tax and communication law related
matters.  Baker has also advised on matters concerning the
Debtors' relationship with foreign subsidiaries; Baker has
provided advice on corporate matters concerning issues specific
to the Debtors' foreign affiliates, securities law services
under French law, and on international issues.  As a result of
representing the Debtors on these matters, Baker has acquired
extensive knowledge of the Debtors and their businesses, as well
as their capital structure, financing documents and other
material agreements.

Subject to further order of this Court, Baker will be required
to render various services to the Debtors including provision of
ongoing services regarding the Debtors' relationships with their
various non-U.S. affiliates and on a number of related domestic
and international corporate, securities and tax issues.

Anthony G. Stamato, Esq., a Baker & McKenzie Partner, assures
the Court that the members, counsel and associates of Baker do
not hold or represent any interest adverse to the estates.
However, Baker represented, represents and likely will represent
certain creditors of the Debtors and other parties-in-interest
in matters unrelated to the Debtors, the Debtors' reorganization
cases or these entities' claims against or interests in the
Debtors.

Mr. Stamato informs the Court that GTE Internetworking, a
predecessor of Genuity, entered into an engagement agreement
with Baker, dated November 18, 1998, pursuant to which, the
Debtors retained Baker in connection with various matters,
including global telecommunications law advice.  In connection
with entry into the Engagement Agreement, Baker was not
initially paid a retainer for professional services and expenses
charged by Baker. Prior to the filing of the Debtors' Chapter 11
cases, Baker submitted invoices to the Debtors on a regular,
periodic basis, for professional fees and expenses.  With
respect to these invoices, the Debtors paid $2,000,000 for
services that were rendered by Baker's offices around the world
and as reimbursement for charges and disbursements.  Since the
summer of 2002, Baker has billed the Debtors bi-monthly, and is
currently holding a deposit of $150,000.  On November 26, 2002,
Baker sent the Debtors an invoice in the amount of $26,607.86
for services provided and costs incurred through November 15,
2002.

As promptly as practicable after all fees and charges accrued
prior to the Petition Date have been finally posted, Mr. Stamato
tells the Court that Baker will issue a final billing statement
for the actual fees, charges, and disbursements for the period
prior to the Petition Date.  The Final Billed Amount will be
paid from amounts presently held by Baker and the balance will
be held as a postpetition retainer to be applied against any
unpaid fees and expenses approved by the Court with respect to
Baker's final fee application in these cases.

Baker will be providing professional services to the Debtors
under its standard billing practices.  Presently, the standard
hourly rates under the firm's rate structure range from:

        Partners                               $305 - 550
        Associates                             $160 - 380
        Legal assistants and support staff      $75 - 210

These hourly rates are subject to periodic increases in the
normal course of the firm's business, often due to the increased
experience of the particular professional. (Genuity Bankruptcy
News, Issue No. 3; Bankruptcy Creditors' Service, Inc., 609/392-
0900)


GLOBAL CROSSING: Court Okays Cooperman's Appointment as Examiner
----------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
approved the appointment of Martin E. Cooperman as the Examiner
for the Global Crossing Ltd., et. al.

Martin E. Cooperman is a managing partner of the New York area
offices of Grant Thornton LLP.  Mr. Cooperman will charge the
Debtors $450 per hour, subject to periodic adjustments. (Global
Crossing Bankruptcy News, Issue No. 31; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


GOODYEAR TIRE: S&P Hatchets Credit Rating Down 2 Notches to BB-
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Goodyear Tire & Rubber Co., to 'BB-' from 'BB+'.

At the same time, the rating on the company's $1.3 billion
senior bank facility and other senior unsecured debt was lowered
to 'BB-' from 'BB+'. All ratings on the company were removed
from CreditWatch, where they were placed October 31, 2002. The
outlook is now negative. The Akron, Ohio-based company's 'B'
commercial paper rating was withdrawn. Total debt was about
$5 billion at September 30, 2002.

The rating actions reflect Standard & Poor's concerns regarding
Goodyear's timely execution of its plan to improve profitability
in its North American tire operation.

"Poor recent operating performance has diminished financial
flexibility and made the timing of long-term profit potential
uncertain. As a result, Standard & Poor's believes that
liquidity issues could arise over the next two years, if
measurable improvements do not occur in 2003, given Goodyear's
expected operating cash flow relative to substantial debt
maturities ($1.6 billion between 2003-2005), cash pension
funding of up to $550 million through 2004 (with the potential
for further significant pension contributions beyond 2004
depending on market conditions), and the uncertain outcome of
upcoming labor contract negotiations," commented Standard &
Poor's credit analyst Nancy C. Messer.

Longer term, profit potential is challenged by difficult
industry fundamentals and the constraints posed by the company's
capital intensive character, which has inhibited Goodyear from
responding effectively to industry pressures and changes.
Although Standard & Poor's believes that the actions taken by
Goodyear to improve working capital management, reduce operating
and capital costs, and better position the company from a
marketing perspective will lead eventually to improved financial
performance, the improvement is taking far longer than
originally anticipated.


GOODYEAR TIRE: Expresses Disappointment with S&P's Downgrades
-------------------------------------------------------------
The Goodyear Tire & Rubber Company (NYSE: GT) commented on
Standard & Poor's Ratings Services' decision Tuesday to lower
its rating of Goodyear debt by two degrees, or "notches," from
BB+ to BB-.

Certain of the company's accounts receivable financing
arrangements in the U.S. and Europe require a minimum S&P credit
rating as a condition to borrowing.  This S&P ratings action
puts the company at the minimum required rating but does not
affect its ability to access these financing arrangements.

In response to S&P's action, Robert J. Keegan, president and
chief operating officer, and incoming chief executive officer of
Goodyear, said: "We are disappointed in the S&P decision.  While
we understand their assessment that we need to improve our
operational and financial performance, we already have a plan in
place to achieve these objectives.  That plan involves
revitalizing our North American consumer replacement tire
business, building on the strong improvements we have made in
other operations, and restoring revenue and earnings growth
momentum, which in turn will build value for all our
stakeholders."

"Our North American Tire business clearly faces several
challenges and we have already taken decisive action to regain
momentum in the market.  We are also improving our operational
performance including ongoing cost-cutting efforts and the
implementation of successful initiatives that have worked well
in our six other divisions.  These initiatives are being
spearheaded by the new president of North American Tire whose
track record includes the turnaround of our Chemicals business."

"Goodyear remains fundamentally sound with many strengths to
build on.  We have some of the world's most recognizable brands,
a solid management team in place and outstanding people
throughout the company.  We are achieving continued strong
operational performance in six of our seven divisions, which
have dramatically improved their results throughout 2002.  We
believe that with the continued support of our key
constituencies, we will have adequate cash flow and liquidity to
meet our financial obligations.  We will continue to provide
quality products and services to our customers and to be a
reliable customer for our suppliers."

Keegan concluded: "The year 2003 clearly will be a transition
year for Goodyear, as we take the steps necessary to properly
position the company strategically, operationally and
financially for long-term strength and success.  We believe that
these steps will result over time in a restoration of our credit
ratings to investment grade levels."

Goodyear is the world's largest tire company.  Headquartered in
Akron, Ohio, the company manufactures tires, engineered rubber
products and chemicals in more than 90 facilities in 28
countries.  It has marketing operations in almost every country
around the world.  Goodyear employs about 95,000 people
worldwide.

Goodyear Tire & Rubber's 7.0% bonds due 2028 (GT28USR1) are
trading at about 55 cents-on-the-dollar, DebtTraders says. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=GT28USR1for
real-time bond pricing.


GREEN FUSION: Seeking New Financing to Continue Ops. & Pay Debts
----------------------------------------------------------------
Green Fusion Corporation was incorporated on March 5, 1998 in
the state of Nevada and is listed on the OTC Bulletin Board
under the GRFU symbol. Effective May 1, 2002, the Company
acquired all of the issued and outstanding shares of House of
Brussels Holdings Ltd., which owns and operates Brussels
Chocolates Ltd.  Brussels Chocolates is a manufacturer and
wholesaler of premium Belgium-styled chocolates.  On May 10,
2002 the Company also acquired all of the issued and outstanding
shares of GFC Ventures Corp., a company that had been supplying
management services to Green Fusion and had facilitated the
purchase of Brussels chocolates by Green Fusion.

The Company has a working capital deficiency and is not paying
its debts in a timely manner.  The Company is actively seeking
new financing to fund future operations and to pay existing
liabilities.  There is no assurance that the Company will be
successful.  These conditions raise substantial doubt about the
Company's ability to continue as a going concern.

Green Fusion Corporation achieved revenues in the amount of
$1,302,681 for the six months ended October  31, 2002, compared
to revenues of $1,046,254 for the six months ended October 31,
2001, representing an increase of $256,427, or 24.5%.  Revenues
increased to $944,894 for the three months ended October 31,
2002 from $618,787 for the three months ended October 31, 2002,
representing an increase of $326,107, or 52.7%.  All revenues
for both periods were attributable to the business operations of
House of Brussels Chocolates.   The increase in revenues is
attributable to new wholesale contracts that the Company has
obtained for the Christmas season.   These new wholesale
contracts include sales to SLC Sweets and to major retailers,
including Costco.  The plan is to continue to work with SLC and
major retailers to continue to expand the Company's wholesale
distribution base.

Green Fusion did not earn any revenues from sales of products
under its license agreement with Sega of  America during the
second quarter.  The Company is working with Sega of America to
launch a line of chocolates products using the Sonic the
Hedgehog character in late third quarter or fourth quarter.
Green Fusion will be responsible for undertaking all selling and
marketing efforts and expenses to achieve sales of this product
line.  It may incur these selling expenses in its third and
fourth quarters prior to  achieving revenues from this product
line in subsequent quarters.

The Company has achieved this increase in revenues despite the
drop in retail revenue that resulted from  the closure of seven
retail outlets and the sale of the remaining four retail stores.
Revenues for the Company's first quarter included $65,000 of
licensing fees associated with the sale of the four retail
stores in July 2002 and the entering into of license
arrangements with the purchaser for the operation of  these
stores.  The license fees paid were one-time license fees.  The
purchaser has agreed under the terms of the licensing
arrangement to purchase product from Green Fusion on a wholesale
basis but will not pay ongoing license fees.

Green Fusion's loss decreased to $311,235 for the six months
ended October 31, 2002 from $442,074 for the six months ended
October 31, 2001, representing a decrease of $130,839, or 29.6%.
The Company had a net profit of $105,950 for the three months
ended October 31, 2002 compared to a loss of $187,749 for the
three months ended October 31, 2001.  The increase in
profitability of $294,699 for the three months ended  October
31, 2002 over the three months ended October 31, 2001 reflects
increased revenues and decreased  selling, general and
administrative expenses.

The Company had a cash deficit in the amount of $157,219 as of
October 31, 2002, compared to cash in the amount of $8,444 as of
April 30, 2002.  The working capital deficit decreased to
$295,129 as of October 31, 2002, compared to a working capital
deficit of $562,115 as of April 30, 2002.

Accounts receivable increased to $994,207 as of October 31,
2002, compared to $186,244 as of April 30 and is net of any
doubtful accounts.  The increase is a result of the high sales
that were generated during Green Fusion's second quarter.

The Company's accounts payable increased to $1,133,396 as of
October 31, 2002, compared to $630,076 as of April 30.  The
increase in accounts payable is attributable to increased
purchasing for the Christmas season production and the Company's
inability to pay for accounts payable from cash reserves.
Included in this amount are unpaid management fees owing to two
of the Company's officers, Mr. Grant Petersen and Mr. L. Evan
Baergen.

Green Fusion incurred an increase to bank indebtedness in the
amount of $163,711 during the six months ended October 31, 2002.
This bank indebtedness represents a bank overdraft that was
incurred to cover shortfalls in cash resources, and cheques
issued in excess of cash.   There are no stated terms of
repayment and the Company is paying interest at the rate set
from time to time by the bank.  The overdraft, although smaller,
remains outstanding.


GROUP TELECOM: Ontario Court OKs Plan of Arrangement & Reorg.
-------------------------------------------------------------
GT Group Telecom Services Corp., GT Group Telecom Services
(U.S.A.) Corp., and London Connect Inc., announced that the
Ontario Superior Court of Justice sanctioned and approved their
plan of arrangement and reorganization, following approval by
the secured and unsecured creditor classes, as announced on
December 19, 2002.

"We are very pleased that the plan has been approved and want to
thank the creditors for their support through this process,"
said Dan Milliard, chief executive officer, Group Telecom. "We
expect to implement the plan before February 15, 2003, just
prior to Group Telecom's closing of the transaction with
360networks."

Group Telecom is a Canadian independent, facilities-based
telecommunications provider, with a national fibre-optic network
linked by 454,125 strand kilometres of fibre-optics, at
March 31, 2002. Group Telecom's unique backbone architecture is
built with technologies such as Gigabit Ethernet for delivery of
enhanced network performance and Synchronous Optical Network for
the highest level of network reliability. Group Telecom offers
next-generation high-speed data, Internet, application and voice
services, delivering enhanced communication solutions to
Canadian businesses. Group Telecom operates with local offices
in 17 markets across nine provinces in Canada. Group Telecom's
national office is in Toronto. For more information, please
visit http://www.gt.ca


HECLA MINING: Will Defer Payment of January 1 Preferred Dividend
----------------------------------------------------------------
Hecla Mining Company (NYSE:HL) (NYSE:HL-PrB) announced the
decision by the board of directors not to pay the January 1,
2003, quarterly payment of dividends to the holders of Hecla
Series B Cumulative Convertible Preferred Stock.

Hecla Mining Company, headquartered in Coeur d'Alene, Idaho,
mines and processes silver and gold in the United States,
Venezuela and Mexico. A 111-year-old company, Hecla has long
been well known in the mining world and financial markets as a
quality silver and gold producer. Hecla's common and preferred
shares are traded on the New York Stock Exchange under the
symbols HL and HL-PrB.

                         *    *    *

As previously reported in Troubled Company Reporter, Standard &
Poor's revised its outlook on Hecla Mining Co., to positive from
negative based on the company's improved cost position.

Standard & Poor's said that its ratings on the company,
including its triple-'C'-plus corporate credit rating, are
affirmed. Standard & Poor's preferred stock rating on Hecla
remains at 'D', as the company is not current on its dividends.
Hecla, headquartered in Coeur d'Alene, Idaho, has about $19
million in total debt.

Standard & Poor's ratings on Hecla continue to reflect its well
below average business position due to its limited reserve base,
operating diversity, and tight liquidity.


HOLLINGER INT'L: Closes Private Placement of 9% Senior Notes
------------------------------------------------------------
Hollinger International Inc., (NYSE: HLR) announced the closing
of the private placement of $300 million of 9% Senior Notes due
2010 of Hollinger International Publishing Inc., one of its
subsidiaries.  The Notes are guaranteed by Hollinger
International Inc.

HIPI received net proceeds of approximately $291.7 million from
the sale of the Notes before expenses associated with the
offering.  The offering of the Notes was not registered under
the Securities Act of 1933.  The Notes may not be offered or
sold in the United States absent registration or an applicable
exemption from the registration requirements.

The placement of the Notes closed contemporaneously with the
closing of HIPI's amended $310 million senior secured credit
facility with a group of financial institutions arranged by
Wachovia Securities, Inc.  This facility consists of a $45
million revolving credit facility which matures on
September 30, 2008, a $45 million amortizing term loan which
matures on September 30, 2008, and a $220 million amortizing
term loan which matures on September 30, 2009.  Borrowings under
the senior credit facility are subject to certain coverage
ratios, advance limits and other conditions. Berenson Minella &
Company acted as financial advisor to Hollinger on these
financings.

Hollinger International Inc., intends to use the proceeds from
the Notes offering and borrowings under the amended $310 million
credit facility, together with available cash on hand, to redeem
existing notes of HIPI, to repay all amounts owed by Hollinger
International Inc., under its loan agreement with Trilon
International Inc., to retire the equity forward purchase
agreements (Total Return Equity Swaps) between Hollinger
International Inc., and certain Canadian chartered banks, and
for general corporate purposes.  All of the revolving credit
facility will be undrawn at close and will remain available
should the need arise.

Conrad Black, Chairman of the Company, commented: "We are very
pleased to have completed our previously announced comprehensive
financing initiative, which has significantly simplified the
Company's capital structure.  Under our new financing
arrangements, we have achieved several important benefits for
Hollinger International Inc., including extending the average
maturity of the Company's indebtedness, reducing the Company's
effective borrowing rate, and obtaining more advantageous
borrowing terms.

"A portion of the debt issues will be used to retire fully the
balance of the Total Return Equity Swaps. As a result of changes
to accounting rules with effect from the fourth quarter of 2000
the company has reported accounting losses, in addition to
interest expense, on these instruments. For the full year 2001
these accounting losses amounted to $61.5 million and for the
first nine months of the current year, $18.1 million. After the
fourth quarter of 2002 those accounting losses will stop. In
addition the cancellation of these instruments will reduce the
issued and outstanding shares for Earnings per Share purposes by
about seven million from 96.1 million issued down to 89.2
million on a fully diluted basis."

Hollinger International Inc., owns English-language newspapers
in the United States, United Kingdom, and Israel.  Its assets
include The Telegraph Group Limited in Britain, the Chicago Sun-
Times, the Jerusalem Post, a large number of community
newspapers in the Chicago area, a portfolio of new media
investments and a variety of other assets.

For more information on Hollinger International Inc., please
visit its Web site at http://www.hollinger.com

                        *     *     *

At September 30, 2002, the Company's balance sheets show a
working capital deficit of about $112 million.

                 Update on Financing Initiative

As previously announced, the Company is continuing to pursue a
comprehensive financing initiative in order to extend debt
maturities and provide more advantageous borrowing terms. This
initiative may include a new amended syndicated credit facility
for which Wachovia Securities Inc., would act as lead-arranger
and bookrunner. Additionally this initiative may include the
sale, in a private placement, of long-term debt securities.
Completion of these transactions will be subject to market
conditions, conclusion of definitive agreements and satisfaction
of conditions in such agreements. The long term debt securities
have not and will not be registered under the Securities Act of
1933 and may not be offered or sold in the United States absent
registration under that Act or an applicable exemption from the
registration requirements.

As reported in Troubled Company Reporter's December 13, 2002
edition, Standard & Poor's placed its ratings on Hollinger Inc.,
and its subsidiaries, including Hollinger International Inc.,
and Hollinger International Publishing Inc., on CreditWatch with
negative implications.

At the same time, the 'BB-' rating was assigned to Hollinger
International Publishing's proposed US$300 million senior
secured three-tranche bank facility due between 2008-2009, and
the 'B' rating was assigned to Hollinger International
Publishing's announced US$300 million senior unsecured notes due
2010. Net proceeds from the new issuances will be used to
refinance outstanding indebtedness, including the remaining
US$240 million 9.25% senior subordinated notes due 2006 and
US$265 million 9.25% senior subordinated notes due 2007,
repayment of US$90 million debt at Hollinger International, and
for general corporate purposes. Following completion of the
announced refinancing, Standard & Poor's will withdraw its
senior subordinated debt ratings on the company.


HORIZON GROUP: Selling Partnership Interests to Pleasant Lake
-------------------------------------------------------------
Horizon Group Properties, Inc., (Nasdaq: HGPI) an owner,
operator and developer of factory outlet and power centers,
entered into an agreement to sell up to 145,349 limited partner
units in Horizon Group Properties, L.P., to Pleasant Lake Apts.,
Ltd.  The purchase price is $5.16 per unit.  The funds from the
transaction will be provided to Horizon Group Properties, L.P.
HGP is the sole general partner of Horizon Group Properties,
L.P. and currently owns approximately 84% of the total units
outstanding.  The units HGP proposes to sell represent
approximately 4.2% of the total units outstanding.

The sale of the units is conditioned upon the receipt of consent
of partners representing the majority ownership of Horizon Group
Properties, L.P., with respect to certain amendments to the
partnership agreement in connection with the transaction.
Closing of the transaction is expected to occur on December 31,
2002.  Pleasant Lake Apts., Ltd. is an affiliate of Howard M.
Amster, a current limited partner in Horizon Group Properties,
L.P., the owner of approximately 29.5% of HGP's shares and a
director of HGP.

HGP entered into an extension agreement with National City Bank
to extend the maturity date of a loan secured by HGP's
corporate office building in Norton Shores, Michigan until
April 30, 2003. The loan has a current principal balance of $2.3
million and was originally scheduled to mature on December 27,
2002.  The interest rate during the extension period is LIBOR
plus 5.5%, adjusted monthly, with a total required monthly
payment of $50,000.  HGP paid a fee of $5,000 in connection with
the extension.

Based in Chicago, Illinois, Horizon Group Properties, Inc. has
11 factory outlet centers and one power center in 8 states
totaling more than 2.5 million square feet.

                          *     *     *

In its SEC Form 10-Q filed on November 14, 2002, the Company
said that is in default with respect to the obligations of two
loans originated by JP Morgan in July 1999 with an aggregate
principal balance of $45.5 million at September 30, 2002
(excluding accrued interest and penalties). The defaults are the
result of the Company's failure to pay in full the amounts due
under the loans commencing with the payment due October 1, 2001.
Each loan is secured by a group of three properties. The loans
are non-recourse to HGPI, subject to limited customary
exceptions.

The Company remits monthly all available cash flow, after a
reserve for monthly operating expenses, as partial payment of
the debt service. The failure to pay the full amount due
constitutes a default under the loan agreements which allows the
respective lenders to exercise their various remedies contained
in the loan agreements, including application of escrow balances
to delinquent payments and foreclosure on the properties which
collateralize the loans. The Company and the servicers of the JP
Morgan Loans are currently attempting to negotiate a
restructuring of the loans, but the Company can give no
assurance that such negotiations will result in any modification
of the terms of the loans.

The JP Morgan Loans require the monthly funding of escrow
accounts for the payment of real estate taxes, insurance and
capital improvements which totaled $331,000 at September 30,
2002. In addition, $2.3 million of monthly available cash flow
remitted as debt service has been placed in special purpose
escrow accounts by the loan servicers, rather than being applied
to the balances due on the loan. The Company continues to manage
the properties pursuant to a management agreement which is
subject to cancellation by the servicers of the loans. The
Company receives fees of approximately $25,000 per month for
such services.

The declining results of operations resulting in the inability
to service the JP Morgan Loans was judged to represent an
indication of possible impairment in the value of the properties
which secure the loans. In the third quarter of 2001, the
Company estimated the current value of the six centers which
secure the loans and concluded that the carrying value of four
of the centers exceeded the fair values of those centers.
Accordingly, the results of operations for the three and nine
months ended September 30, 2001, include a provision for asset
impairment of $18.0 million, representing a write-down of the
carrying values of the assets to their estimated fair value. The
aggregate carrying value of the real estate of the properties
collateralizing the JP Morgan Loans approximates $37.8 million
at September 30, 2002. This value is less than the current
outstanding loan balances totaling $45.5 million, excluding
accrued interest and penalties. If the lender were to foreclose
on the collateral properties in full satisfaction of the loans,
the Company would record a gain for the difference between the
carrying value of the properties and related net assets and the
outstanding loan balances plus accrued interest and penalties.
The estimation of the fair value of the six centers securing the
JP Morgan Loans involved estimates by management with respect to
future cash flows, market conditions and valuations applicable
to such properties. Future events could occur which would cause
the Company to conclude that the carrying values of the
Company's properties may need to be further adjusted.


INSILCO TECH: Secures Nod to Pay $500K of Critical Vendors Claim
----------------------------------------------------------------
Insilco Technologies, Inc., and its debtor-affiliates obtained
permission from the U.S. Bankruptcy Court for the District of
Delaware to pay up to $500,000 of prepetition Critical Vendor
claims.

The Debtors manufacture a wide range of highly specialized
electronic interconnection components and systems.  Nearly 90%
of these highly sophisticated products are produced as custom
orders from Critical Vendors.

Payment of the Critical Vendors claims is essential to
completion of the Going Concern Sales.  As previously reported
in the Troubled Company Reporter, Insilco has agreed to sell its
passive components business to Bel Fuse Ltd., for approximately
$35 million; a substantial majority of the custom assembly
business to Amphenol Corporation for approximately $10 million;
the North Myrtle Beach custom assembly business to LL&R
Partnership, a private investor group, for $1.7 million; and the
stamping business to SRDF Acquisition Company LLC, a private
investor group, for approximately $13 million. Insilco
Technologies, Inc., has also signed a contract to sell the
Ireland-based custom assembly business to that facility's
general manager, thus resolving approximately $1.8 million of
liabilities that would otherwise have been triggered by a plant
shutdown. Insilco anticipates that a competitive bidding process
in the bankruptcy proceedings will be conducted for each
business in an effort to obtain higher or otherwise better
offers prior to the close of these transactions.  The
preservation of the relationship with each Critical Vendor is
crucial to the continued operation of the Debtors' ordinary
course of business, which is a requirement under the "stalking
horse" asset purchase agreements that the Debtors signed prior
to filing their chapter 11 petition.

Insilco Technologies, Inc., a leading global manufacturer and
developer of highly specialized electronic interconnection
components and systems, serving the telecommunications, computer
networking, electronics, automotive and medical markets, filed
for chapter 11 petition on December 16, 2002. Pauline K. Morgan,
Esq., Sharon M. Zieg, Esq., Maureen D. Luke, Esq., at Young,
Conaway, Stargatt & Taylor and Constance A. Fratianni, Esq.,
Scott C. Shelley, Esq., at Shearman & Sterling, represent the
Debtors in their restructuring efforts.  When the Debtors filed
for protection from its creditors, it listed $144,263,000 in
total assets and $611,329,000 in total debts.


IVG CORP: Wrinkle Gardner Resigns as Certifying Accountants
-----------------------------------------------------------
The certifying accountant for IVG Corporation, Wrinkle, Gardner
& Company, P. C., Certified Public Accountant has resigned
effective November 22, 2002, and the Company has not yet
retained a new auditor.

IVG Corp., is a human resources and technology holding company
that acquires promising revenue-generating companies and assists
them by providing financial guidance, business model creation
and implementation, access to equity resources and technology.
To date, Its portfolio companies consist of SES-Corp., Inc., a
Professional Employer Organization that provides employee
payroll, human resource and benefit services; Swan Magnetics,
Inc., a developer of a proprietary ultra-high-capacity flexible
disk drive technology and the owner of 46% of the common stock
of iTVr, Inc., which is developing next generation digital video
recording technology; and CyberCoupons.com, Inc., a source for
consumers to obtain coupons for grocery, household and beauty
products via the Internet. The Company also has a division,
GeeWhizUSA.com, which is building a vertically integrated supply
chain of patented or proprietary novelty, gift and branded
products.

At September 30, 2002, the Company's balance sheet shows a
working capital deficit of close to $6 million, and a total
shareholders' equity deficit of about $5 million.


J. CREW GROUP: Completes New $180MM Credit Facility Arrangement
---------------------------------------------------------------
J. Crew Group, Inc., entered into a new $180 million credit
facility with Wachovia Bank, N.A. and Congress Financial
Corporation.  The facility consists of a $160 million revolving
credit and letter of credit facility and a $20 million
supplemental loan available on a seasonal basis.  The new three-
year agreement replaces an existing $175 million secured
facility with JP Morgan Chase that was due to expire on
October 17, 2003.

The new credit facility is secured by all of the assets of the
Company. Total borrowings under the facility are subject to
limitations based upon specified percentages of eligible
receivables, eligible inventories and certain real estate.
Initial availability at the time of the closing was
approximately $100 million.

J. Crew Group, Inc., is a leading retailer of men's and women's
apparel, shoes and accessories.  As of November 30, 2002, the
Company operated 152 retail stores, the J. Crew catalog
business, jcrew.com, and 43 factory outlet stores.

                          *    *    *

As previously reported, Standard & Poor's lowered its corporate
credit rating on J. Crew Group Inc., to single-'B'-minus from
single-'B' based on the company's poor operating performance
over the past 16 months and  weakening credit protection
measures. J. Crew is a leading mail order and store retailer of
women's and men's apparel, shoes, and accessories.

The outlook is negative.

"The poor operating performance has hurt credit protection
measures. EBITDA coverage of interest fell to 1.4 times in the
trailing four quarters ended May 4, 2002, from 1.5x in 2001 and
2.2x in 2000," Standard & Poor's credit analyst Diane Shand
said. "Moreover, significant improvement in the near term is not
expected due to the soft U.S. economy and the intensely
competitive retail environment."


KMART CORP: Taps S&P Corporate Value as Valuation Consultant
------------------------------------------------------------
Kmart Corporation and its affiliated debtors seek to employ
Standard & Poor's Corporate Value Consulting, a division of The
McGraw-Hill Companies, Inc., as valuation consultant to appraise
their tangible and intangible assets as necessary for their
emergence from Chapter 11.

Mark A. McDermott, Esq., at Skadden, Arps, Slate, Meagher &
Flom, tells the Court that, as part of their intention to file a
joint plan of reorganization and disclosure statement as soon as
practicable, and no later than February 25, 2003, the Debtors
need to apply fresh-start accounting principles to the
Reorganized Debtors' balance sheet upon emergence from Chapter
11.  This is a necessary aspect of the Plan and the Disclosure
Statement.  According to Mr. McDermott, the application of
fresh-start accounting principles will require a determination
of the Reorganized Debtors' post-confirmation value.  The value
of the Reorganized Debtors must be allocated to different asset
pools on its balanced sheets.

This is where CVC comes in, Mr. McDermott says.  The firm will
estimate the value of the Debtors' other tangible and intangible
assets that will not be covered by the valuation analyses to be
conducted by Miller Buckfire Lewis & Co. LLC, Abacus Advisory &
Consulting Corp., LLC and Rockwood Gemini Advisors.  In
particular, CVC's analysis will include the valuation of the
Debtors' tangible and intangible assets, including but not
limited to:

     (i) the furniture and fixtures at 1,800 stores, and the
         Debtors' headquarters and distribution centers;

    (ii) all leasehold improvements at leased stores and leased
         distribution centers;

   (iii) Kmart-related brand rights like names and marks;

    (iv) key brand license agreements;

     (v) the pharmacy lists at 1,300 stores;

    (vi) proprietary software;

   (vii) Kmart.com and Bluelight.com domain names;

  (viii) certain contractual agreements; and

    (ix) the Debtors' equity interest in the Meldisco
         subsidiaries of Footstar, Inc., which operate footwear
         departments in Kmart stores.

Upon completion of its valuation analysis, CVC will provide the
Debtors with a final report on its findings.

Mr. McDermott asserts that CVC is the best service provider
available to conduct the valuation analysis.  Formerly a
division of PricewaterhouseCoopers LLP, CVC was acquired by
McGraw-Hill in August 2001.  Mr. McDermott further explains that
CVC has been advising clients on valuation and corporate finance
services for over 30 years.  It is one of the U.S. market
leaders in providing valuation and value analysis to major U.S.
companies for financial reporting, tax, business combination,
corporate restructuring, capital allocation and capital
structure purposes. The firm also extensive experience in
providing valuation analysis for reorganizing debtors applying
for fresh-start accounting principles upon emergence from
Chapter 11, including Federated Department Stores, Inc., Hayes
Lemmerz International, Inc., Montgomery Ward &Co., Inc., and
Harmony Records & Tapes, Inc.

The Debtors propose to compensate CVC for its services in
accordance with its customary hourly rates.  The Debtors will
also refund the firm its necessary out-of-pocket expenses.
CVC's hourly rates are:

                  Professional            Rate
                  ------------            ----
                  Managing Director       $395
                  Director                 375
                  Manager                  325
                  Senior Associate         245
                  Associate                175
                  Analyst                  110
                  Administrative            50

CVC's Steven J. Shanker attests that his firm and its respective
principals and professionals:

     -- do not have any connection with the Debtors, their
        creditors, or any other party in interest, or their
        respective attorneys or accountants;

     -- are "disinterested persons" under Section 101(14) of the
        Code; and

     -- do not hold or represent an interest adverse to the
        estates. (Kmart Bankruptcy News, Issue No. 40; Bankruptcy
        Creditors' Service, Inc., 609/392-0900)

Kmart Corp.'s 9.00% bonds due 2003 (KM03USR6), DebtTraders
reports, are trading at about 13 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=KM03USR6for
real-time bond pricing.


MAGNUM HUNTER: Redeems $30,000,000 of 10% Senior Notes Due 2007
---------------------------------------------------------------
Magnum Hunter Resources, Inc., (NYSE: MHR) said that pursuant to
the Indenture dated May 29, 1997, between Magnum Hunter
Resources, Inc., a Nevada corporation, the Subsidiary Guarantors
named therein, and Wachovia Bank, National Association, as
successor to First Union National Bank, as Trustee, as amended
and supplemented by that certain Supplemental Indenture dated
January 27, 1999, it has elected to redeem $30,000,000 in
aggregate principal amount of its outstanding 10% Senior Notes
due 2007 (CUSIP No. 55972F AA 2).  At close of business at 5:00
p.m., Eastern time on January 27, 2003, the Company will pay the
Holders of the Redeemed Notes the redemption price of 105% of
the $30 million aggregate principal amount of the Notes, or
$31.5 million plus accrued and unpaid interest through the
Redemption Date of $475 thousand.

The Company currently has outstanding $140 million in principal
amount of its 10% Senior Notes due 2007 and the Redeemed Notes
will be chosen by lot. The Company today is mailing to all
Holders of Notes to be redeemed the notice required under the
Indenture.  Approximately $10.5 million of the outstanding
$140 million 10% Senior Notes due 2007 are already owned by an
unrestricted subsidiary of Magnum Hunter.

Commenting on the partial redemption of the Company's 10% Senior
Notes, Mr. Gary C. Evans, Chairman, President and CEO stated
"Magnum Hunter continues to delever its balance sheet and this
is just another way for us to reduce our cost of funds.  We are
essentially taking 10% money and funding it with 3% money under
our senior bank credit facility which saves us over $2 million
annually in interest expense.  Due to our success in completing
$100 million of non-core asset sales during 2002, our liquidity
under our senior bank credit facility is sufficient to allow for
this partial redemption."

Magnum Hunter Resources, Inc., is one of the nation's fastest
growing independent exploration and development companies
engaged in three principal activities: (1) the exploration,
development and production of crude oil, condensate and natural
gas; (2) the gathering, transmission and marketing of natural
gas; and (3) the managing and operating of producing oil and
natural gas properties for interest owners.

                        *     *     *

As previously reported, Standard & Poor's raised the corporate
credit ratings of Magnum Hunter Resources Inc., to BB- and its
senior unsecured debt rating to B+.


MASSEY ENERGY: W. Virginia Court Reverses WVDEP Suspension Order
----------------------------------------------------------------
Massey Energy Company (NYSE: MEE) learned that the Circuit Court
of Raleigh County, West Virginia had reversed an order by the
West Virginia Department of Environmental Protection (WVDEP)
requiring a 9-day suspension of operations at subsidiary Marfork
Coal Company's refuse impoundment.

The 9-day suspension had been ordered by the WVDEP following a
"show cause" hearing in which Marfork was required to show why
its operations should not be suspended.  The circuit court found
that the show cause hearing was not conducted in an impartial
manner by the WVDEP and that the hearings therefore violated
Marfork's due process rights.  The court remanded the matter
back to the WVDEP for an impartial hearing.  In a previous
appeal to the West Virginia Surface Mine Board, the suspension
was reduced from 14 to 9 days because of the same due process
issues.

"We are extremely gratified to learn of the circuit court's
decision, as we have long maintained that the DEP did not give
Marfork a fair hearing," said Don L. Blankenship, Massey
Energy's Chairman and CEO.  "Since the time of the violations
cited by the DEP, we have put in place a variety of safeguards
to improve environmental compliance throughout our organization
and we hope the WVDEP will work with us in the future to
continually improve our performance."  The Company reported that
a similar appeal of a suspension order at Massey's Independence
Coal Company is still pending a circuit court decision.

Massey Energy Company, headquartered in Richmond, Virginia, is
the fifth largest coal producer by revenue in the United States.

As reported in Troubled Company Reporter's December 4, 2002
edition, Standard & Poor's lowered its long-term corporate
credit rating on coal mining company Massey Energy Co., to non-
investment-grade 'BB' from 'BBB-' based on concerns regarding
the Richmond, Virginia-based company's access to capital
markets. Standard & Poor's said that it has also withdrawn its
'A-3' short-term corporate credit and commercial paper ratings
on the company.

The company has $585 million in debt outstanding. The current
outlook is developing. A developing outlook indicates that the
ratings could be raised, lowered, or affirmed.

Standard & Poor's said that at the same time it has assigned its
'BB+' senior secured bank loan rating to Massey's $400 million
of secured revolving credit facilities.


NAT'L CENTURY: Mid Atlantic et al Seeks Relief from Injunction
--------------------------------------------------------------
Mid Atlantic Home Health Network, Inc., National Nurses
Services, Inc., Oak Springs Nursing Home, LLC, Hunt Country Home
Health, Inc., and Hunt Country Nursing Services, Inc., ask the
Court for relief from the automatic stay and relief from the
injunction entered in National Century Financial Enterprises,
Inc.'s chapter 11 cases.

Charles H. Cooper, Jr., Esq., at Cooper & Elliot, LLC, in
Columbus, Ohio, relates that except for Oak Springs Nursing
Homes, LLC, the Movants are both creditors and debtors of the
Debtors.

Mr. Cooper relates that the Debtors are indebted to the Movants
pursuant to the Sale and Subservicing Agreements between the
Movants, as sellers, and NPF VI, Inc., as purchaser.  The
Movants are likewise indebted to the Debtors pursuant the terms
and conditions of the same Agreements.

The Movants owe the Debtors $3,500,000, while the Debtors have
collateral in the nature of the Movant's current receivables
valued at $4,800,000, pledged to secure the Debt.

Mr. Cooper stresses that under the Agreements, the Debtors,
particularly NPF VI, are obligated to purchase all "Eligible
Receivables" and to pay the contractual purchase prices, as
submitted for funding.  However, the Debtors have failed to
comply with the Agreement terms and ceased to pay the purchase
price for the Eligible Receivables submitted to them for
purchase.

Moreover, Mr. Cooper continues, the Debtors failed to comply
with the Agreements by wrongfully using or misappropriating the
moneys in the escrow reserve accounts for purposes other than
permitted under the Agreements.  The moneys in the escrow
reserve accounts do not belong to the Debtors and the wrongful
taking from the Movants amounts to $816,000 that the Debtors owe
to the Movants.

The Debtors have perfected security interests in all of the
Movant's accounts receivables.  Thus, Mr. Cooper assures the
Court that that they will not challenge that lien status in the
event that relief is granted by the Court.

However, Mr. Cooper explains, the Movants will be forced out of
business if the relief sought is not granted.  The Movants will
be forced to terminate around 3,000 employees that will leave
thousands of patients without nursing care.  In addition, the
existing $4,800,000 worth of collateral held to secure the
Movants' indebtedness to the Debtors will become difficult to
collect and likely only worth 20% of the value it is worth while
the Movants continue as ongoing businesses.

Mr. Cooper argues that allowing the Movants to collect and use
the purchased receivables to continue business will create
additional collateral to secure the amounts owed to the Debtors,
in the form of new, good, receivables, in excess of the amount
of the moneys used from collection of the receivables.  The
Movants will also submit a report on these activities on a
weekly basis to the Court.  Furthermore, during the period the
Court allows the Movants to collect receivables and continue in
business, they will aggressively seek a new financing source to
pay out the Debtors.

The Movants ask the Court to modify the automatic stay and the
Court's prior injunctive Order to permit them to collect
purchased receivables up to $816,000 and use the amounts
necessary to continue their business operations for a period of
90 days.  The Movants will replace the collateral with new
receivables for $955,000, representing a 17% premium. (National
Century Bankruptcy News, Issue No. 4; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


NATIONAL STEEL: Court Approves Stipulation with Portside Energy
---------------------------------------------------------------
Settling this dispute, Judge Squires signs a Stipulation between
National Steel Corporation and Portside Energy providing that:

A. The Debtors will pay tolling fees due to Portside Energy for
    the period from and after November 1, 2002, on these terms:

    -- Portside Energy will submit an invoice for $390,000 as
       Monthly Interim Payment to the Debtors on or before the
       5th day of each month.  In turn, the Debtors will remit
       their Monthly Interim Payment to Portside Energy on or
       before the 15th calendar day of that same month, except
       with respect to those months when an outage in excess of
       seven days of either generator is planned by Portside
       Energy.  In this case, the Monthly Interim Payment will be
       $195,000, rather than $390,000;

    -- Beginning December 1, 2002, the Monthly Invoice will, in
       addition to the Monthly Interim Payment, include a detail
       of the actual tolling fees due to Portside Energy under
       the parties' tolling agreement, ground lease, easement,
       license and service agreement, and operating and
       maintenance agreement, for the prior month.  If Portside
       Energy delivers the Monthly Invoice to the Debtors on or
       before the 5th calendar day of the month, then on or
       before the 15th calendar day of the month in which the
       Monthly Invoice was issued, the Debtors will remit payment
       of the Monthly Interim Payment for the current month:

       * plus -- where the Actual Charges exceed the prior
                 month's Monthly Interim Payment; or

       * minus -- where the prior month's Monthly Interim Payment
                 exceeds the Actual Charges,

       the difference between the Actual Charges and the prior
       month's Monthly Interim Payment -- the True-Up.

       In the event that the True-Up calculation results in a
       number that is less than zero, the True-Up will constitute
       a credit against the next month's Monthly Invoice;

B. Beginning November 1, 2002, the Debtors will make any and
    all monthly payments due under the O&M Agreement at the
    beginning -- not later than the 4th business day -- of each
    month;

C. Portside Energy will pay to the Debtors $151,628 as O&M
    Payment of the $175,000 originally claimed by the Debtors in
    connection with the O&M Agreement through October 31, 2002.
    The difference between the originally claimed amount and the
    O&M Payment is a credit for $23,372 for O&M due to Portside
    Energy.  The Debtors agree that Portside Energy is entitled
    to withhold and recoup against any prepetition amounts due to
    it under the O & M Agreement;

D. Beginning November 1, 2002, Portside will continue to remit
    timely payment to the Debtors of all amounts which come due
    after November 14, 2002 pursuant to the terms and conditions
    of the O&M Agreement;

E. If Portside Energy fails to receive timely any payment
    required in this Stipulation, it may serve a Notice of
    Default on the Debtors.  If the Debtors fail to cure the
    default within eight business days after the service of the
    Notice of Default, then the stay will be automatically and
    immediately modified so that Portside Energy may, without
    further order of Court, discontinue supplying its services
    and terminate its performance to the Debtors under the
    Agreements.  However, Portside Energy cannot discontinue its
    services in the case where the default or failure to cure is
    based only on any right of setoff the Debtors exercised
    pursuant to the Agreements or applicable law as a result of
    Portside Energy's failure to remit any payment required under
    the terms of the O&M Agreement or this Stipulation.  Portside
    Energy reserves the right to dispute the validity of a setoff
    the Debtors asserted, but it may not, without further order
    of Court, discontinue supplying its services or terminate its
    performance to the Debtors under the Agreements based on a
    dispute over the validity of a setoff asserted by the
    Debtors;

F. Any notice or payment that is due on a Saturday, Sunday or
    legal holiday may be delivered or paid on the next business
    day; and

G. The Debtors will negotiate with Portside Energy in good faith
    to restructure the Agreements with the goal of attempting to
    reduce their costs under the Agreements while attempting to
    maintain the economics of the Agreements for Portside Energy.
    (National Steel Bankruptcy News, Issue No. 19; Bankruptcy
    Creditors' Service, Inc., 609/392-0900)


NCS HEALTHCARE: Omnicare Amends Tender Offer Expiring on Jan. 7
---------------------------------------------------------------
Omnicare, Inc. (NYSE: OCR), a leading provider of pharmaceutical
care for the elderly, announced that, in connection with its
Agreement and Plan of Merger with NCS HealthCare, Inc.,
(NCSS.OB), it has amended its tender offer for all of the
outstanding shares of Class A common stock and Class B common
stock of NCS. Omnicare's amended tender offer is for $5.50 per
share in cash.

The tender offer is scheduled to expire at 12:00 midnight, New
York City time on January 7, 2003, unless extended.

NCS stockholders who already have tendered shares of Class A
common stock or Class B common stock and have not withdrawn such
shares need not take any additional action with respect to
Omnicare's amended tender offer.  These stockholders will
receive the increased offer price of $5.50 per share in
Omnicare's tender offer.

As of the close of business on December 20, 2002, a total of
10,759,862 shares of Class A common stock of NCS had been
tendered, which represents approximately 58% of the outstanding
shares of Class A common stock, and a total of 24,782 shares of
Class B common stock had been tendered, which represents less
than 1% of the outstanding shares of Class B common stock.

The NCS Board of Directors has unanimously approved the Omnicare
tender offer and merger and unanimously recommends that NCS
stockholders tender their shares in the offer.  Omnicare has
been advised by NCS that each of the directors and executive
officers of NCS intends to tender all shares owned by such
person pursuant to the tender offer.  As a group, all of the
directors and executive officers of NCS own approximately
1,173,738 shares of Class A common stock and approximately
4,810,806 shares of Class B common stock. Following completion
of the tender offer, the merger agreement provides for the
merger of a wholly-owned subsidiary of Omnicare into NCS,
pursuant to which those shares not tendered will be converted
into the right to receive $5.50 per share in cash.

The transaction will enhance Omnicare's position as a leading
provider of pharmacy services for the elderly by combining NCS's
approximately 199,000 residents served with the approximately
746,000 residents already served by Omnicare.  The combined
company will have a nationwide network of pharmacies serving
long-term care providers in 47 states.  Based upon results
for Omnicare and NCS for the quarter ended September 30, 2002,
Omnicare's combined annualized revenues will approximate $3.3
billion.

NCS HealthCare provides pharmaceutical and related services to
long-term care facilities, including skilled nursing centers,
assisted living facilities and hospitals.  NCS serves
approximately 199,000 residents of long-term care facilities in
33 states and manages hospital pharmacies in 10 states.

NCS Healthcare's September 30, 2002 balance sheet shows a total
shareholders' equity deficit of about $111 million.

Omnicare, based in Covington, Kentucky, is a leading provider of
pharmaceutical care for the elderly. Omnicare serves
approximately 746,000 residents in long-term care facilities in
45 states, making it the nation's largest provider of
professional pharmacy, related consulting and data management
services for skilled nursing, assisted living and other
institutional healthcare providers. Omnicare also provides
clinical research services for the pharmaceutical and
biotechnology industries in 28 countries worldwide. For more
information, visit the company's Web site at
http://www.omnicare.com


NERVA: Fitch Cuts 4 Note Classes Ratings to Junk & Low-B Level
--------------------------------------------------------------
Fitch Ratings has downgraded the following classes of notes
issued by Nerva Ltd.:

      --$513,573,683 class A floating-rate notes due 2014 to 'B'
        from 'AAA';

      --$12,000,000 class B floating-rate notes due 2014 to 'C'
        from 'AA';

      --$30,000,000 class C floating-rate notes due 2014 to 'C'
        from 'BBB';

      --$12,000,000 class D floating-rate notes due 2014 to 'C'
        from 'BB'.

All classes were also removed from Rating Watch Negative. The
above referenced securities have been downgraded as a result of
credit deterioration, higher than expected default rates, and
lower recovery expectations.

As of the most recent trustee report, Nov. 30, 2002, Nerva Ltd.
was failing all of its OC tests as follows: class A (trigger vs.
actual) 108 vs. 97.86; class B (trigger vs. actual) 107 vs.
95.63; class C (trigger vs. actual) 104 vs. 90.47; and class D
(trigger vs. actual) 102 vs. 88.55.

The class A notes are currently receiving their coupon, however,
the uncertainty of the timing and extent of loss may lead to an
impairment of the principal amount as well as future rating
actions. The transaction has exposure to underperforming sectors
such as manufactured housing, aircraft securitizations and
collateralized debt obligations. As such, this transaction has
exposure to distressed credits that were material in Fitch's
analysis. Distressed credits include, but are not limited to,
subordinate class(es) of Corvus Investments Ltd., Dorset CDO
Ltd., Flavius CDO Ltd., Marv I and Marv II Ltd., R.F. Alts
Finance I Ltd. Series 2, Savannah II CDO Ltd., Taunton CDO Ltd.,
Tullas CDO Ltd., as well as a mezzanine class of South Street
CBO 2000-I Ltd.. Fitch will continue to monitor this transaction
and take additional action if warranted.


OAKWOOD HOMES: Fitch Further Junks Manufactured Housing Deals
-------------------------------------------------------------
Fitch Ratings downgrades 12 class B-2 bonds to 'C' from 'CCC' in
12 Oakwood Manufactured Housing transactions. Following Oakwood
Homes' (Oakwood) Chapter 11 bankruptcy filing on Nov. 15, 2002,
Oakwood elected not to make guarantee payments to the bonds in
the relevant transactions. Additionally, servicing of Oakwood's
manufactured housing portfolio was transferred to Oakwood
Servicing Holdings Co., a newly created limited purpose wholly-
owned subsidiary of Oakwood Acceptance Corporation. OSHC and OAC
entered a sub-servicing agreement under which OAC will continue
the daily servicing operations of the MH loans. The deals were
structured with a 100 basis points (bps) servicing fee.
Depending on the transaction, either 100 bps is subordinated to
the bonds or 50 bps is paid first in the waterfall and 50 bps is
subordinated. With the current servicing transfer, all servicing
fees are now at the top of the waterfall. This change will
reduce the available cash payable to the deals.

If losses exceed the amount of excess spread, the B-2 classes
will incur a principal write-down. However, the financial
structures provide for interest to be paid on both written down
principal as well as carryover interest amounts. In addition,
balances on the written down amount may be written back up to
the degree there is cash available. Without these interest
payable and write-up provisions, the classes would be rated 'D'.
Whether there will be sufficient cash available in the future to
make these payments depends upon collateral and servicing
performance. Oakwood Homes is currently operating in Chapter 11
Bankruptcy.

Oakwood MH transactions with B-2 limited guarantee classes
downgraded to 'C' from 'CCC' are:

      -Series 1997-A;

      -Series 1997-B;

      -Series 1997-C;

      -Series 1997-D;

      -Series 1998-B;

      -Series 1998-C;

      -Series 1999-A;

      -Series 1999-B;

      -Series 1999-C.

The following Oakwood MH transactions' B-2 classes are
downgraded to 'C' from 'CCC':

      -Series 1996-A;

      -Series 1996-B;

      -Series 1996-C.


PACIFIC GAS: Wins Court Approval to Hire Vantage Consulting
-----------------------------------------------------------
Pacific Gas and Electric Company obtained authority from the
Court to employ Vantage Consulting, Inc., to conduct an
independent audit to verify PG&E's compliance with the Affiliate
Transaction Rules adopted by the California Public Utilities
Commission for the period covering January 1, 2001 through
December 31, 2001.

PG&E has entered into a contract with Vantage dated December 10,
2001. Vantage is a management consulting firm with particular
expertise in the area of utility operating functions. Subject to
the Court's approval, the Contract provides for Vantage to
conduct the independent audit to verify PG&E's compliance with
the Affiliate Transaction Rules, with a draft report to be
submitted to PG&E by March 5, 2002, and a final audit and
written report to be submitted to PG&E by April 12, 2002. The
maximum fee under the Contract (including reimbursable expenses)
is $297,826, with hourly billing rates ranging from $225 (Senior
Consultant and Senior Accountant) to $275 (Project Director).

PG&E and Vantage acknowledge that all fees incurred and expenses
to be reimbursed shall be subject to final approval by the
Court, in accordance with Bankruptcy Code Section 330, the
Court's Guidelines for Compensation and Expense Reimbursement of
Professionals and any other applicable rules or orders, upon
filing of an appropriate application, after notice and a
hearing.

Given the short duration of the Contract and maximum fee
provided, PG&E requests authorization to pay Vantage its fees
and expenses on a monthly basis based on invoices received,
provided such fees and expenses do not collectively exceed the
maximum fee set forth in the Contract, without necessity of any
prior notice or Court order and provided that Vantage shall mail
copies of its invoices to the United States Trustee concurrently
with its transmittal of such invoices to PG&E, and any fees and
expenses paid to Vantage shall remain subject to approval by a
Final Fee Order. (Pacific Gas Bankruptcy News, Issue No. 50;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


PALADYNE CORP: Independent Auditors Express Going Concern Doubt
---------------------------------------------------------------
Paladyne Corp., through its subsidiary e-commerce support
centers, inc., provides customer relationship management
solutions out of its customer contact center in Jacksonville,
NC. ecom serves the CRM marketplace as well as traditional
contact center marketplaces with telemarketing, professional
services, and customer and technical support as an outsource
provider.

On February 1, 2001, Paladyne merged with ecom, which was a
privately held provider of third party customer and technical
support. Paladyne brought a proprietary data cleansing and
integration software capability marketed as Datagration(TM) to
enhance the CRM capabilities of ECOM'S state-of-the-art customer
contact center.

The Company's revenues of $8,755,369 and $6,488,865 for the
years ended August 31, 2002 and 2001, respectively reflect an
increase of $2,266,504, or 34%. This increase is due entirely to
2002 including twelve months of operations while 2001 included
only seven months of operations, beginning with the merger
with ecom on February 1, 2001. Revenue has declined on a monthly
basis as a result of the general economic downturn in the U.S.
economy, reduction in the volume of the Gibralter contract, loss
of the Lowe's contract and reduced marketing activities dictated
by cash restraints.

This revenue and all other related operating activity is
attributable to Company's call center activities that were
acquired in the Merger with ecom.

The Company has accumulated approximately $11,655,000 of net
operating loss carryforwards as of August 31, 2002, which may be
offset against taxable income and income taxes in future years.
The use of these losses to reduce future income tax liabilities
will depend on the generation of sufficient taxable income prior
to the expiration of the net operating loss carryforwards.

The Company is not generating any cash from operations and it
has no cash resources. The Company is in default on the $350,000
loan agreement with a bank and has been unable to meet its
obligations under the $5,000,000 notes to Gibralter Publishing,
Inc. The payments on various capital leases are also in arrears.
This situation and the anticipated need for working capital for
the Company to increase its marketing and revenue base has
resulted in the Board of Directors taking certain actions
intended to stabilize the Company and provide it with a chance
to succeed in the future. In December 2002, the Company an
Gibralter Publishing, Inc. agreed to exchange the $5,000,000 in
notes for 1,000,000 shares of Series D Preferred shares.

The Board of Directors has also approved the proposed
transaction with WAG Holdings, LLC, Glen H. Hammer and A.
Randall Barkowitz that will add sufficient capital to help
relieve the Company's short-term cash flow crisis. The Board
anticipates that the Investor Group will be able to locate
sufficient additional funding to address the Company's longer-
term financial needs, although there can be no assurance that
such funding will be obtained. This transaction provides that in
exchange for $750,000 the Investor Group will receive 70% of the
Company's fully diluted post transaction common stock. Although
not required, the Company is seeking the approval of the
transaction by the Company's shareholders at a Special Meeting
to be held in early 2003. As a condition to the consummation of
the proposed transaction, the Company intends to effect a 1-for-
10 reverse stock split, the approval for which will be sought at
the same Special Meeting of Shareholders.

The independent auditors report on the Company's August 31, 2002
and 2001 financial statements states that the Company's
recurring losses raise substantial doubts about the Company's
ability to continue as a going concern.


PERKINELMER: Completes Refinancing and Extends Debt Maturities
--------------------------------------------------------------
PerkinElmer, Inc., (NYSE: PKI) substantially completed its
previously announced refinancing plan to repay existing debt in
order to extend existing shorter-term debt maturities. Thursday,
the company repaid its existing bank debt and synthetic lease by
completing the sale of $300 million aggregate principal amount
of ten-year senior subordinated notes and entering into new
senior secured credit facilities for a $315 million six-year
term loan and a $100 million revolving credit facility.

PerkinElmer also accepted for payment $110,319,000 aggregate
principal amount of its outstanding 6.80% Notes due October 15,
2005 pursuant to its cash tender offer and consent solicitation.
The final step of the refinancing plan, PerkinElmer's pending
cash tender offer to purchase its Zero Coupon Convertible
Debentures due August 7, 2020, is scheduled to expire at 12:00
midnight, New York City time, on Friday, December 27, 2002.

     Senior Subordinated Notes and Secured Credit Facilities

PerkinElmer sold $300 million aggregate principal amount of
senior subordinated notes in an institutional private placement.
The notes have been guaranteed on a senior subordinated basis by
certain of PerkinElmer's domestic subsidiaries.

PerkinElmer borrowed the full amount available under the term
loan at the closing of the new senior secured credit facilities.
PerkinElmer did not draw upon the $100 million revolving credit
facility, which remains available for the company's working
capital needs. The revolving credit facility has a five-year
term. A portion of the proceeds from the term loan is being used
to purchase the tendered 6.80% notes and a portion of the
proceeds, together with proceeds from the sale of the company's
senior subordinated notes, will be used to purchase the zero
coupon convertible debentures that are tendered.

                           6.80% Notes

The tendered 6.80% notes represented approximately 96% of the
total outstanding 6.80% notes. PerkinElmer will pay an aggregate
of $111,768,350.37 for the tendered 6.80% notes. Each holder who
tendered 6.80% notes and the related consents at or before 5:00
p.m., New York City time, on December 6, 2002, the consent
expiration date, will receive $1,013.41 for each $1,000
principal amount of tendered 6.80% notes, including a $15
consent payment. Each holder who tendered notes and the related
consents after the consent expiration date will receive $998.41
for each $1,000 principal amount of tendered 6.80% notes.

The 6.80% notes tender offer commenced on November 22, 2002 and
expired at 10:00 a.m., New York City time, on Thursday,
December 26, 2002. It is anticipated that State Street Bank and
Trust Company, as Depositary for the tender offer and consent
solicitation, will pay noteholders on or about December 26,
2002. On December 6, 2002, the expiration date for the 6.80%
notes consent solicitation, PerkinElmer announced that it had
received the requisite consents to amend the indenture under
which the 6.80% notes were issued. PerkinElmer and State Street
Bank and Trust Company, as Trustee, executed a supplemental
indenture, which became effective as of December 26, 2002,
eliminating substantially all of the restrictive covenants from
the indenture, as more fully described in PerkinElmer's Offer to
Purchase and Consent Solicitation Statement dated November 22,
2002.

PerkinElmer has filed with the SEC a Schedule TO in connection
with the tender offer for the zero coupon convertible
debentures. The Schedule TO contains important information about
PerkinElmer, the zero coupon convertible debentures, the tender
offer and related matters. Debenture holders are urged to read
the Schedule TO carefully.

PerkinElmer, Inc., is a global technology leader focused in the
following businesses - Life and Analytical Sciences,
Optoelectronics, and Fluid Sciences. Combining operational
excellence and technology expertise with an intimate
understanding of its customers' needs, PerkinElmer creates
innovative solutions - backed by unparalleled service and
support - for customers in health sciences, semiconductor,
aerospace, and other markets whose applications demand absolute
precision and speed. The company markets in more than 125
countries, and is a component of the S&P 500 Index. Additional
information is available through http://www.perkinelmer.com

                          *     *     *

As reported in Troubled Company Reporter's December 13, 2002
edition, Standard & Poor's lowered its corporate credit and
senior unsecured note ratings on PerkinElmer Inc., to 'BB+'
from 'BBB-', based on weak credit measures for the rating and
subpar operating performance in 2002. At the same time, Standard
& Poor's assigned a 'BB+' bank loan rating to the proposed $445
million senior secured credit facilities due 2008 and a 'BB-'
rating to the proposed $225 million of senior subordinated notes
due 2012. Ratings were removed from CreditWatch where they were
placed on October 30, 2002.

The prior bank loan rating and the short-term rating were
withdrawn.

The outlook on the Wellesley, Mass.-based diversified technology
provider is stable. Total debt outstanding is $661 million
(including synthetic leases and accounts receivable
securitization).


PROVANT INC: Enters Pact to Sell Drake Beam Morin-Japan for $30M
----------------------------------------------------------------
On December 15, 2002, Provant, Inc., announced that it has
entered into an agreement calling for the sale for $30 million
to Drake Beam Morin-Japan (DBM-J), a leading Japanese human
resource services provider, of Provant's Performance Solutions,
Technology and Development, Vertical Markets and Project
Management groups and Learning and Strategic Alliances
businesses. Provant will retain its Government and Leadership
Consulting groups.

The purchase price will consist of $23.5 million cash, subject
to a working capital adjustment, and the assumption by DBM-J of
substantially all of Provant's non-bank indebtedness. No taxes
will be payable by Provant as a result of the transaction.
Provant intends to use the cash proceeds less expenses to reduce
bank debt. The transaction is subject to necessary bank and
third-party consents and other customary closing conditions. The
parties anticipate a closing at year-end. DBM-J is a publicly
held company in Japan and an independent licensee of DBM, Inc.,
a subsidiary of Thomson Inc.  DBM, Inc., is not involved in this
transaction.

The principal businesses to be sold are J. Howard and
Associates, BT.Novations, Project Management, Strategic
Interactive, Executive Education Institute, MOHR Learning, KC-
EP, Provant Media and Decker Communications. In fiscal 2002
those businesses had aggregate revenues of slightly less than
half of Provant's revenues for that year. After the sale,
Provant's businesses will be its Government and Leadership
Consulting Groups, consisting principally of Star Mountain and
Senn-Delaney Leadership.

As a leading provider of performance improvement training
services and products, Provant helps its clients maximize their
effectiveness and profitability by improving the performance of
their people. With over 1,500 corporate and government clients,
the Company offers blended solutions combining web-based and
instructor-led offerings that produce measurable results by
strengthening the performance and productivity of both
individual employees and organizations as a whole.

For more information visit http://www.provant.com

                          *    *    *

As reported in Troubled Company Reporter's November 7, 2002
edition, Provant continues to be in default under its credit
facility agreement, and "believe[s] [the Company is] close to
finalizing the terms of an extension to it that would
end the current default."

The terms of this extension will, among other things, extend the
due date of the facility to April 15, 2003, subject to the
Company's continued obligation to take actions that would result
in the early repayment of our indebtedness to the banks. The
Company continues to pursue various strategic alternatives,
which include the sale of Provant or various of its assets.


QWEST: S&P Drops Ratings to SD After Debt Exchange Completion
-------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Qwest Communications International Inc., to 'SD' from
'CC'. Standard & Poor's also lowered its senior unsecured debt
rating on Qwest Capital Funding Inc. to 'D' from 'C'.

These actions reflect Qwest Communications International's
completion of its recent debt exchange. Standard & Poor's views
this transaction as a distressed exchange under its corporate
criteria, and, therefore, the transaction is treated as a
selective default under these criteria.

"The transaction resulted in $5.2 billion of senior unsecured
debt at Qwest Capital Funding exchanged into about $3.3 billion
of new debt representing three new note issues at Qwest Services
Corp. Upon completion of its review of the new capital
structure, we will reassign the corporate credit rating of Qwest
Communications International and the senior unsecured debt
rating for the untendered debt at Qwest Capital Funding," said
Standard & Poor's credit analyst Catherine Cosentino.

While the corporate credit rating of the parent is likely to be
'B-' in line with the rating prior to this exchange, Qwest
Capital Funding's debt may be either 'CCC' or 'CCC+', depending
on Standard & Poor's assessment of the degree of priority
obligations relative to total assets under the new capital
structure. Standard & Poor's will also assess the impact on
the ratings for debt at Qwest Communications International and
Qwest Communications Corp. The three new debt issues at Qwest
Services Corp. are likely to be rated 'CCC+', given the fact
that there is significantly less debt structurally superior to
these notes versus the untendered debt at Qwest Capital Funding.

Qwest Communications' 7.25% bonds due 2008 (Q08USR2) are trading
at about 72 cents-on-the-dollar, DebtTraders reports. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=Q08USR2for
real-time bond pricing.


RECOTON CORP: Completes Two Asset Dispositions for $35 Million
--------------------------------------------------------------
Recoton Corporation (Nasdaq: RCOT), a leading global consumer
electronics company, closed two asset dispositions, selling its
AAMP-mobile and security after-market accessory business and its
NHT (Now Hear This) loudspeaker business, in separate
transactions, for total gross proceeds aggregating approximately
$35 million.

The AAMP sale was made to an affiliate of ICV Capital Partners,
L.L.C., a New York based private equity firm, while the NHT
sales was made to Rockford Corporation (Nasdaq: ROFO). Detailed
terms of both agreements were not disclosed. The Company stated
that substantially all net proceeds of both sales will be used
to pay down existing Recoton debt.

The AAMP operations are headquartered in Clearwater, Florida
with manufacturing or warehouse operations located in
Springfield, Missouri, Reno, Nevada and San Diego, California.
AAMP currently has three of the industries leading brand names -
Stinger(R), Peripheral(R) and Best Kits(R) - and markets these
products to leading retailers, and service/installation shops
nationwide. Micah Ansley, founder and president of AAMP, and Ron
Freeman will remain an integral part of the new operations.

NHT, located in Benicia, California, designs high-quality
loudspeakers for the home theater, stereo, custom installation
and professional audio markets under the brand names of
Evolution, Super Audio and Architectural. NHT's products are
positioned to sell at premium price points through high-end
specialty audio stores and customer installation design
showrooms.

Robert L. Borchardt, Chairman, President and Chief Executive
Officer of Recoton, commented, "These two sales are part of the
Company's previously announced total restructuring of Recoton,
which, at its conclusion, is expected to reduce the Company's
overall debt structure, enhance cash flows and restore
profitability. While we expect being able to announce the sale
of additional non-strategic assets in the coming weeks, there
can be no assurances that any such asset sales will be
consummated."

He concluded, "Recoton maintains an industry-leading position in
the consumer electronics audio and accessories marketplace. We
remain committed to strengthening our presence in this industry
by leveraging our well-known family of accessory and audio brand
names, introducing new and exciting technologies, and elevating
customer service and support to establish new industry-
standards."

Recoton Corporation is a global leader in the development and
marketing of consumer electronic accessories, audio products and
gaming products. Recoton's more than 4,000 products include
highly functional accessories for audio, video, car audio,
camcorder, multi-media/computer, home office and cellular and
standard telephone products, as well as 900MHz wireless
technology products including headphones and speakers;
loudspeakers and car and marine audio products including high
fidelity loudspeakers, home theater speakers and car audio
speakers and components; and accessories for video and computer
games. The Company's products are marketed under three business
segments: Consumer Electronics Accessories, Audio and Video
Gaming. CE Accessory products are offered under the Ambico(R),
Ampersand(R), AR(R)/Acoustic Research(R), Discwasher(R),
InterActa, Jensena, Parsec(R), Recoton(R), Ross(TM),
SoleControl(R) and SoundQuest brand names. Audio products are
offered under the Advent(R), AR(R)/Acoustic Research(R),
HECO(TM), Jensen(R), MacAudio(R), Magnat(R), Phase Linear(R) and
Recoton(R) brand names. Gaming products are offered under the
Game Sharko, InterActa and PerformanceO brand names.

ICV-AAMP Holdings is a New York-based private-equity investment
firm that is currently investing a fund of $130.5 million that
it raised from a group of blue-chip investors in 2000. The firm
puts a priority on investments in companies that operate or hire
in inner cities or are owned by ethnic minorities or serve
minority markets and seeks to invest in companies that have
market-leading positions and strong management teams. Additional
information about ICV is available at the firm's Web site,
http://www.icvcapital.com

Rockford is a designer, manufacturer and distributor of high-
performance audio systems for the mobile, professional, and home
theatre audio markets. Rockford's mobile audio products are
marketed under the Rockford Fosgate and Lightning Audio and Q-
Logic brand names. Rockford's professional audio and home
theatre products are marketed under the Hafler and Fosgate
Audionics brand names. Rockford recently completed an investment
in SimpleDevices, which licenses its patented, standards-based
SimpleWareT and SimpleMedia ServicesT software to consumer
electronics, PC, automotive and network equipment OEMs.


RESTORAGEN: Selling Rights to Phase 2 GLP-1 Program to Amylin
-------------------------------------------------------------
Amylin Pharmaceuticals, Inc., (Nasdaq: AMLN) signed a definitive
agreement with Restoragen, Inc., to acquire rights to a Phase 2
program utilizing continuous infusion of glucagon-like peptide 1
(GLP-1), targeted for the treatment of congestive heart failure
in patients ineligible for transplant. GLP-1 is a naturally
occurring hormone produced in the gut in response to food
intake. In connection with this transaction, Amylin will also
acquire rights to various GLP-1 related patents.

On December 17, 2002, Restoragen, formerly BioNebraska, Inc.,
filed a voluntary petition for reorganization under Chapter 11
of the Bankruptcy Code. Completion of this transaction is
subject to certain conditions, including bankruptcy court
approval. If completed, Amylin will pay Restoragen approximately
$4 million, plus contingent milestone payments, and royalties on
product sales.

"This is an excellent opportunity for us to leverage our
extensive expertise in metabolic diseases and peptide drug
development to potentially help people with congestive heart
failure who are ineligible for transplant procedures," said
Alain D. Baron, MD, Senior Vice President of Clinical Research
for Amylin Pharmaceuticals. "The preliminary clinical data look
promising and we look forward to continuing the program."

Nearly 5 million people in the US are afflicted by congestive
heart failure, with approximately 550,000 new cases diagnosed
each year. CHF can be caused by common conditions such as high
blood pressure, coronary heart disease, diabetes, and heavy
alcohol consumption. CHF carries a risk of morbidity and
mortality. It is estimated that approximately 80,000 people with
CHF are transplant ineligible. Congestive heart failure is
accompanied by shortness of breath and fatigue and occurs when
the heart cannot sufficiently pump oxygenated blood throughout
the body, resulting in impaired kidney function and an
accumulation of fluid in the lungs and other body tissues.

Amylin Pharmaceuticals is engaged in the discovery, development
and commercialization of potential drug candidates for the
treatment of diabetes and other metabolic disorders. The
Company's lead drug candidate, SYMLIN(TM) (pramlintide acetate),
is targeted as a treatment for people with diabetes who use
insulin. In October 2001, the Company received an FDA approvable
letter for SYMLIN. Approval in the U.S. is subject to
satisfactory completion of additional clinical work currently
underway. Amylin Pharmaceuticals' second diabetes drug
candidate, AC2993, is targeted for the treatment of type 2
diabetes and is currently in Phase 3 development. A long-acting
release formulation of AC2993, or AC2993 LAR, is in Phase 2
development. In September 2002, Amylin and Eli Lilly and Company
announced a global agreement to collaborate on the development
and commercialization of AC2993. Amylin Pharmaceuticals' third
drug candidate, AC3056, is currently in Phase 1 evaluation as a
potential treatment for metabolic disorders relating to
cardiovascular disease. Amylin also maintains a focused research
and development program to discover and in-license additional
drug candidates for metabolic diseases. Further information on
Amylin Pharmaceuticals and its pipeline in metabolism is
available at http://www.amylin.com


RFS ECUSTA: Committee Brings-In CVH as Industry Consultant
----------------------------------------------------------
The Official Committee of Unsecured Creditors, appointed in the
chapter 11 cases of RFS Ecusta Inc., and RFS US Inc., asks for
permission from the U.S. Bankruptcy Court for the District of
Delaware to engage CVH Enterprises, Inc., as its Industry
Consultant.

The Committee may ask CVH to:

   a) analyze and advise the Committee regarding the pulp and
      paper industry;

   b) analyze and evaluate motions filed by the Debtors including
      the Debtors' motion to borrow monies from an insider for
      the purpose of restarting the Mill and the Debtors' motion
      to provide a prepetition rebate to a former customer;

   c) analyze the desirability and feasibility of continuing the
      Debtors' business;

   d) assist the Committee in its identification of potential
      purchasers and assist in developing a strategy to maximize
      the net proceeds from a sale;

   e) assist the Committee in the evaluation of proposals
      received from prospective purchasers and provide analysis
      and advice with respect to the structuring and negotiation
      of any sale or reoganization of the Debtors;

   f) attendance at meeting of the Committee and participation in
      telephonic conferences with members of the Committee and or
      Counsel; and

   g) perform such other consulting and advisory services as may
      be required and in the interest of creditors as requested
      by the Committee or Counsel to the Committee which are in
      the best interest of the creditors.

For its consulting services, CVH will receive:

       (i) $150 per hour for advisory and consulting services
           regarding the industry and the operations of the
           Debtor; and

      (ii) $10,000 for identifying potential purchasers to the
           Committee.

RFS Ecusta Inc., and RFS US Inc., were leading manufacturers of
high quality premium paper products for the tobacco and
specialty and printing paper products.  The Company filed for
chapter 11 protection on October 23, 2002.  Christopher A. Ward,
Esq., at The Bayard Firm, and Joel H. Levitin, Esq., at Dechert,
represent the Debtors in their restructuring efforts.  When the
Debtors filed for protection from its creditors, they listed
estimated debts and assets of more than $10 million each.


RIBAPHARM: Delaware Court Imposes TRO Against Company Directors
---------------------------------------------------------------
ICN Pharmaceuticals, Inc., (NYSE: ICN) obtained a temporary
restraining order restricting the ability of the Board of
Directors of Ribapharm Inc., (NYSE: RNA) to take actions outside
of the ordinary course of business pending effectiveness of
ICN's removal of Ribapharm directors.  ICN announced yesterday
that it is seeking removal of five of the six current Ribapharm
directors.

The order was obtained from the Delaware Chancery Court.  Under
the order, the Ribapharm directors would be required to provide
written notice to ICN at least ten business days prior to
Ribapharm taking action outside of the ordinary course, enabling
ICN to seek a further order prohibiting such action. The order
includes restrictions on, among other things:  issuances of
securities, incurrence of indebtedness, acquisitions and
dispositions, and licensing transactions.

ICN owns in excess of 80 percent of Ribapharm's outstanding
stock.

ICN is an innovative, research-based global pharmaceutical
company that manufactures, markets and distributes a broad range
of prescription and non-prescription pharmaceuticals under the
ICN brand name.  Its research and new product development
focuses on innovative treatments for dermatology and infectious
diseases.

Additional information is also available on the company's Web
site at http://www.icnpharm.com

Ribapharm Inc.'s September 30, 2002 balance sheet shows a total
shareholders' equity deficit of about $349 million.


RIBAPHARM: Denies ICN's Statements and Cites Solid Fin'l Results
----------------------------------------------------------------
Ribapharm Inc., (NYSE: RNA) said that public statements made by
parent company ICN Pharmaceuticals (NYSE: ICN) in its attempt to
remove all but one of Ribapharm's Board of Directors are false
and misleading. The company said this action by ICN was in
retaliation for attempts by Ribapharm to clarify ICN's plans
regarding its spin-off, as well as a related tax-sharing
arrangement between the two companies.

"Ribapharm is a well run company, generating solid financial
results, that is committed to best practices in governance and
compensation policy alike," said Johnson Y.N. Lau, M.D.,
Chairman, President and CEO of Ribapharm. "The shareholders of
ICN and of Ribapharm have clearly expressed their desire to see
the completion of the long planned spin-off from ICN. It is
deeply troubling that ICN's management and board of directors
have chosen to make unfounded attacks on Ribapharm management
and its directors-rather than tell Ribapharm, its shareholders,
and ICN shareholders its intentions with respect to the spin-
off.

"It is key to Ribapharm's ability to sustain and enhance its
solid financial performance that it pursue a focused bio-pharma
strategy, implemented by seasoned bio-pharma management-
essentially the very same vision presented to ICN shareholders
by ICN's current management during last May's proxy fight. We
believe ICN's pharma business model is fundamentally
incompatible with Ribapharm's bio-pharma model, if shareholder
value is to be enhanced," Dr. Lau continued.

                Ribapharm Calls for Discussion
           of Its Restructuring Proposal to Benefit
                   ICN and ICN Shareholders

Ribarpharm remains committed to maximizing stock value for both
Ribapharm and ICN shareholders. In fact, Ribapharm presented the
ICN Board with a creative, preliminary debt restructuring
proposal that would benefit both ICN and Ribapharm shareholders
just four weeks ago, but ICN has not responded to this good
faith proposal, except with attacks on the integrity of the
managers and directors of Ribapharm. The company said it is
still awaiting ICN's response.

                Incentive Compensation Conforms
                     to Industry Standards

Criticisms by ICN of cash bonuses and stock options granted by
Ribapharm's Board to senior management at Ribapharm are without
merit. Salary and bonuses extended to all employees, including
senior managers at Ribapharm, were contingent upon thorough
evaluation and counsel made by highly respected, outside
compensation consultants to the company. These were reviewed and
discussed extensively by the board's compensation committee.
They are consistent with biotech industry standards. Annual
bonuses awarded to Ribapharm employees and managers were
distributed in December in recognition of the company's strong
performance this year-and in order to place the company's
incentive compensation awards on a calendar-year basis, as is
common among many companies.

             Ribapharm Clarifies Recent Court Ruling

In addition, Ribapharm said that it was pleased with the
December 24, 2002 decision rendered by the Delaware Court of
Chancery in an action brought by ICN. In that action, ICN was
unsuccessful in obtaining the extreme form of temporary
restraining order that it sought. Under the Order entered by the
Court, which was agreed to by both Ribapharm and ICN following
the hearing, the Ribapharm directors are required to provide
written notice to ICN ten business days prior to Ribapharm
taking action outside the ordinary course. The Court also stated
that nothing in the Order required Ribapharm to make payments
under the tax sharing agreement with ICN.

"It is unfortunate that ICN has chosen spin over substance in
its public comments about our company and about the results of
the December 24th court action," the company said.

"Since we became an independent, publicly-traded company in
April, Ribapharm has exceeded its stated financial objectives as
well as its anticipated research and development milestones,"
said Dr. Lau. "ICN's irresponsible claims should not be allowed
to obscure the truth-that Ribapharm is doing the job it was
formed to do."

            The Right Team to Deliver Shareholder Value

The directors and management team now leading Ribapharm have
clearly demonstrated that they are the right team to deliver
enhanced shareholder value to the shareholders of both Ribapharm
and ICN. Many current Ribapharm managers were indispensable in
the original development of ribavirin, the company said.

Citing strong sales of ribavirin, used in the treatment of
chronic hepatitis C, significant advances in the research and
development program and the company's continued financial
strength, Ribapharm management responded specifically to the
claims and accusations made by ICN in their December 23, 2002
letter to the Board of Directors of Ribapharm.

Ribapharm recently announced that net income for the first nine
months of the year was $90.0 million, versus $42.2 million for
the same period in 2001, reflecting an increase of more than 113
percent. Royalty payments received from the sales of ribavirin,
an antiviral drug licensed to and marketed by Schering-Plough,
totaled $186.4 million through September this year, as compared
to $89.0 million for the same period last year.

"Our enviable record of accomplishment within a few short months
speaks to the dedication and commitment of our employees, senior
managers and the Board of Directors at Ribapharm," said Dr. Lau.
"As such, we take strong exception to the comments and opinions
expressed by ICN and will seek those venues that will further
allow us to ensure that the shareholders of both companies are
accurately and fully informed about these issues."

Ribapharm is a biopharmaceutical company that seeks to discover,
develop, acquire and commercialize innovative products for the
treatment of significant unmet medical needs, principally in the
antiviral and anticancer areas.

At September 30, 2002, Ribapharm's reported an upside-down
balance sheet showing a net capital deficit of about $349
million.


ROYAL HAVEN: Has Until Jan. 17 to File Schedules & Statements
-------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Indiana
gave Royal Haven Builders, Inc., an extension of the deadline to
file comprehensive schedules of assets and liabilities, and
statements of financial affairs, as required under 11 U.S.C.
Sec. 521(1).  The Debtors have until January 17, 2003 to file
these documents.

Royal Haven Builders, Inc., a general construction contractor,
builder and developer, filed for chapter 11 protection on
December 3, 2002.  John W. Graub II, Esq., at Rubin & Levin,
P.C., represents the Debtor in its restructuring efforts.


SALOMON BROTHERS: Fitch Rates Class B-4 and B-5 at Low-B Levels
---------------------------------------------------------------
Salomon Brothers Mortgage Securities VII, Inc., Sovereign Bank
Mortgage Loan Trust, series 2002-1 $532 million residential
variable-rate mortgage pass-through certificates, classes A-1
through A-4 are rated 'AAA' by Fitch Ratings. In addition, Fitch
rates class B-1 ($18 million) 'AA', class B-2 ($4.8 million)
'A', class B-3 ($2.8 million) 'BBB', class B-4 ($2.8 million)
'BB' and class B-5 ($1.7 million) 'B'.

The 'AAA' rating on the class A senior certificates reflects the
5.75% subordination provided by the 3.20% privately offered
class B-1, the 0.85% privately offered class B-2, the 0.50%
privately offered class B-3, the 0.50% privately offered class
B-4, the 0.30% privately offered class B-5, and the 0.40%
privately offered class B-6 (not rated by Fitch). Classes B-1,
B-2, B-3, B-4, and B-5 are rated based on their respective
subordination.

Fitch believes the amount of credit enhancement will be
sufficient to cover credit losses, including limited bankruptcy,
fraud, and special hazard losses. The ratings also reflect the
quality of the underlying collateral and Fitch's confidence in
the integrity of the legal and financial structure of the
transaction.

The mortgage pool consists of four loan groups of fully
amortizing, adjustable-rate mortgage loans. The four loan groups
are cross-collateralized.

Group 1 consists of loans that will have their next adjustment
date within 17 months of the closing date. The group has an
aggregate principal balance of approximately $170,093,388 as of
the cut-off date and a weighted average remaining term to
maturity of 271 months. The average outstanding principal
balance is $130,240. The weighted average amortized loan-to-
value ratio for the mortgage loans is approximately 65.36%. The
states that represent the largest portion of mortgage loans are
PA (41.39%) and NJ (28.75%)

Group 2 consists of loans that will have their next adjustment
date between 18 and 36 months of the closing date. The group has
an aggregate principal balance of approximately $64,990,806 as
of the cut-off date and a weighted average remaining term to
maturity of 329 months. The average outstanding principal
balance is $188,927. The weighted average ALTV for the mortgage
loans is approximately 70.71%. The states that represent the
largest portion of mortgage loans are PA (28.38%),NJ (27.83%),
and MA (13.79%).

Group 3 consists of loans that will have their next adjustment
date 37 months or more following the closing date. The group has
an aggregate principal balance of approximately $243,556,241 as
of the cut-off date and a weighted average remaining term to
maturity of 350 months. The average outstanding principal
balance is $204,497. The weighted average ALTV for the mortgage
loans is approximately 76.94%. The states that represent the
largest portion of mortgage loans are NJ (23.43%), MA (22.46%),
PA (20.71%), and CT (10.57%).

Group 4 has an aggregate principal balance of approximately
$85,864,027 as of the cut-off date and a weighted average
remaining term to maturity of 290 months. The average
outstanding principal balance is $127,206. The weighted average
ALTV for the mortgage loans is approximately 72.48%. The states
that represent the largest portion of mortgage loans are PA
(53.28%), and NJ (24.27%).

SBMS VII, Inc. deposited the loans in the trust, which issued
the certificates, representing undivided beneficial ownership in
the trust. For federal income tax purposes, an election will be
made to treat the trust as a real estate mortgage investment
conduit.  U.S. Bank National Association will act as trustee.


SEVEN SEAS PETROLEUM: AMEX Halts Trading Effective December 24
--------------------------------------------------------------
Seven Seas Petroleum Inc., (Amex: SEV) announced that the
American Stock Exchange halted trading of the Company's shares
effective December 24, 2002. The AMEX's decision is in response
to the involuntary bankruptcy petition filed by the holders of
the majority of the Company's $110 Million Senior Subordinated
Notes on December 22, 2002. As previously announced, the Company
does not intend to appeal the AMEX's decision to delist and
expects a delisting of the Company's shares on December 27,
2002. The Company plans to pursue quotation of its shares on the
OTC Bulletin Board.

As previously announced, Seven Seas will consider various
responses and alternatives prior to taking any action with
respect to the involuntary petition.

Seven Seas Petroleum Inc., is an independent oil and gas
exploration and production company operating in Colombia, South
America.


STRUCTURED ENHANCE: Fitch Cuts Series 1999-1 $47MM Notes to BB-
---------------------------------------------------------------
Fitch Ratings downgraded the Notes of Structured Enhanced Return
Vehicle Trust, series 1999-1 (SERVES 1999-1). The transaction is
a synthetic collateralized loan obligation that enables
investors to gain exposure to the economics of a reference loan
portfolio via a total rate of return swap between the trust and
Bank of America, N.A., the Swap Provider, on a leveraged basis.

     The following security has been downgraded:

     -- $47,500,000 notes to 'BB-' from 'BBB'.

SERVES 1999-1, was establish to enter into a total rate of
return swap with the Swap Provider referencing a $300 million
high-yield loan portfolio. The transaction has experienced
defaults and trading losses that have led Fitch Ratings to
believe that the Notes are no longer representative of a 'BBB'
rating.

Fitch will continue to monitor this transaction.


TESORO PETROLEUM: Completes Asset Sale to Kaneb Pipe for $100MM
---------------------------------------------------------------
Tesoro Petroleum Corporation (NYSE:TSO) -- whose Corporate
Credit Rating has been downgraded by Standard & Poor's to
'double-B-minus' -- completed the sale of the Northern Great
Plains Products System to Kaneb Pipe Line Partners L.P.
(NYSE:KPP) for $100 million, $50 million of which will be used
to pay down term debt.

Tesoro Petroleum Corporation, a Fortune 500 Company, is an
independent refiner and marketer of petroleum products and
provider of marine logistics services. Tesoro operates six
refineries in the western United States with a combined capacity
of nearly 560,000 barrels per day. Tesoro's retail-marketing
system includes nearly 600 branded retail stations, of which
over 200 are company operated under the Tesoro(R) and
Mirastar(R) brands.


TOWN SPORTS INT'L: S&P Affirms B Corporate Credit Rating
--------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B' corporate
credit rating on fitness club operator Town Sports International
Inc. based on the company's announcement that it is not
currently pursuing a recapitalization.

At the same time, Standard & Poor's removed the rating from
CreditWatch, where it was placed on Sept. 26, 2002, with
negative implications.

The outlook is stable. As of Sept. 30, 2002, Town Sports had
$153.3 million of total debt outstanding.

The rating action reflects the company's decision to not pursue
in the immediate future a previously announced recapitalization.
Nevertheless, Town Sports plans to explore opportunities if
favorable market conditions develop.

"Town Sports' financial risk is high, elevated by its relatively
small cash flow base, capital spending-related discr
etionary cash flow deficits, and ongoing expansion plans. There
is limited cushion in the ratings for a potential
recapitalization that would increase debt leverage," said
Standard & Poor's credit analyst Andy Liu. "Liquidity and access
to capital markets have also been of some concern. These are
balanced by good comparable club revenue growth, driven by
increasing membership dues, and ancillary services."

The rating on Town Sports reflects the company's strong market
share in its clustered markets and good same-club revenue
growth, balanced by financial risk associated with an aggressive
growth strategy.

The company's ability to maintain adequate liquidity is
important for rating stability.


TRENWICK GROUP: Renews $182 Million Lloyd's Letters of Credit
-------------------------------------------------------------
Trenwick Group Ltd., entered into definitive final agreements
with its Lloyd's letter of credit providers with respect to the
renewal of $182 million of letters of credit supporting
Trenwick's Lloyd's underwriting operations. With additional
capital provided by Trenwick and National Indemnity Company,
Trenwick's anticipated Lloyd's underwriting capacity for 2003 is
up to $500 million.

Trenwick is a Bermuda-based specialty insurance and reinsurance
underwriting organization with two principal businesses
operating through its subsidiaries located in the United States,
the United Kingdom and Bermuda. Trenwick's reinsurance business
provides treaty reinsurance to insurers of property and casualty
risks from offices in the United States and Bermuda. Trenwick's
international operations underwrite specialty insurance as well
as treaty and facultative reinsurance on a worldwide basis
through its London operations.

As reported in Troubled Company Reporter's December 12, 2002
edition, Trenwick's total debt to capital ratio (total
indebtedness divided by total indebtedness, preferred capital
securities, preferred shares and common shareholders' equity)
decreased to 14.9% at September 30, 2002, from 31.2% on
December 31, 2001, due to the repayment of the $195 million in
principal amount outstanding under the term loan portion of
Trenwick's bank credit facility.

The continuation of an event of default under the credit
facility, the restrictions on Trenwick's ability to pay
dividends to preferred and common shareholders and the potential
demand for cash collateral by the letter of credit providers may
cause additional events of default to occur under the
instruments governing the outstanding indebtedness and preferred
shares of Trenwick and its subsidiaries.

Trenwick's ability to refinance its existing letter of credit
obligations or raise additional capital is dependent upon
several factors, including financial conditions with respect to
both the equity and debt markets and the ratings of its
securities as established by the rating agencies. During the
past year, Trenwick's senior and preferred share debt ratings
have been downgraded significantly by Standard & Poor's
Corporation and by Moody's Investors Service. At this time,
Trenwick's senior debt rating from Standard & Poor's Corporation
is CCC+ and Moody's Investors Service is B3. Trenwick's ability
to refinance its outstanding letter of credit and debt
obligations, as well as the cost of such borrowings, could be
adversely affected by these ratings downgrades or if its ratings
were downgraded further.

Should Trenwick's subsidiaries be unable to meet any letter of
credit reimbursement obligations as they fall due, and such
repayments are not refinanced, Trenwick would become liable for
such repayments under the terms of the guarantees. Because
Trenwick America Corporation, Trenwick Holdings Limited and
Trenwick are holding companies, their principal source of funds
consists of permissible dividends, tax allocation payments and
other statutorily permissible payments from their respective
operating subsidiaries. As a result of recent losses incurred by
Trenwick's operating subsidiaries, their cash distribution
capacities have been significantly reduced.

Also, Standard & Poor's commented on Trenwick Group Ltd., and
its subsidiaries. The ratings on these companies, including the
'CCC+' counterparty credit rating on Trenwick Group Ltd., remain
on CreditWatch with negative implications, where they were
placed on Oct. 21, 2002.


UNICCO SERVICE: S&P Downgrades & Keeps Ratings on Watch Negative
----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on UNICCO Service Co., to 'B' from 'B+' and the company's
senior secured debt rating to 'B+' from 'BB-'. At the same time,
the subordinated debt rating was lowered to 'CCC+' from 'B-'.
The ratings remain on CreditWatch with negative implications,
where they were placed on October 1, 2002.

Auburndale, Massachusetts-based UNICCO, is a North American
outsourcing facilities services company. It had about $75
million of debt outstanding as of its last public filing, for
the quarter ended March 31, 2002.

The rating actions reflect Standard & Poor's heightened concerns
regarding continued challenging industry conditions and the
uncertainty surrounding the company's insurance accrual and its
potential impact on covenant compliance under its senior secured
credit facility. The company has filed for extensions for the
filing of its Form 10-K for the year ended June 30, 2002, and
its Form 10-Q for the quarter ended Sept. 29, 2002, reflecting
the ongoing actuarial review of UNICCO's Workers' Compensation
and general liability self-insurance risks.

"We will meet with management to review UNICCO's operating and
financial plans and monitor its discussions with its senior
lenders, before resolving the CreditWatch listing," said
Standard & Poor's credit analyst David Kang.

UNICCO provides maintenance, operations, engineering, cleaning,
lighting, and administrative/office services to 1,000
commercial, corporate, industrial, education, government, and
retail customers.


UNITED AIRLINES: Signs-Up Deloitte & Touche as Accountants
----------------------------------------------------------
UAL Corporation and its debtor-affiliates ask the Court for
authority to employ Deloitte & Touche as their independent
auditors, accountants and tax service providers, pursuant to
Sections 327(a) and 328(a) of the Bankruptcy Code.  The Debtors
need Deloitte to continue to perform auditing and accounting
services, tax return preparation and planning, and other
accounting, tax and advisory services.

James H.M. Sprayregen, Esq., at Kirkland & Ellis, tells the
Court that the Debtors previously employed Deloitte as its
independent auditors, accountants and tax service providers.  An
affiliate of Deloitte, Deloitte Consulting L.P., had also
provided services for certain of the Debtors.  On account of
this previous employment, Deloitte has considerable knowledge
concerning the Debtors and is already familiar with the Debtors'
business affairs to the extent necessary for the scope of the
proposed and anticipated services.  This experience and
knowledge will be valuable to the Debtors in its efforts to
reorganize.

Mr. Sprayregen further relates that Deloitte is a national
professional services firm with more than 1,600 partners and
over 15,000 professional staff.  The firm's experience in
auditing, accounting, and tax matters is widely recognized, and
it regularly provides services to large and complex business
entities.  Deloitte has extensive experience in delivering
auditing, accounting, and tax services in Chapter 11 cases.
Additionally, Deloitte is well qualified and able to perform
auditing, accounting and tax services for the Debtors in a cost-
effective, efficient and timely manner.

The general nature and extent of services that Deloitte may
perform for the Debtors include:

    (a) auditing and reporting on the consolidated financial
        statements of the Debtors and their non-debtor affiliates
        for the year ending December 31, 2002, and thereafter;

    (b) reviewing quarterly financial information to be included
        in reports of the Debtors filed with the United States
        Securities and Exchange Commission;

    (c) performing agreed upon procedures on the schedule of
        passenger facility charges collected, withheld,
        refunded/exchanged and remitted for the year ending
        December 31, 2002, and thereafter;

    (d) auditing and reporting on the schedule of calendar year
        2000 costs for passenger and property screening;

    (e) auditing and reporting on the schedule of airport
        improvement fees remitted to the Calgary Airport
        Authority for the year ending December 31, 2002, and
        thereafter;

    (f) auditing and reporting on the financial statements of the
        United Air Lines Foundation for the year ending
        December 31, 2002, and thereafter;

    (g) providing property tax services to assist United Air
        Lines in connection with its property tax costs for its
        California properties;

    (h) providing temporary tax staffing to assist in the
        preparation of amended federal and state income tax
        returns;

    (i) providing expatriate tax and international administration
        services, including preparation of federal, state, and
        foreign income tax returns; exit and entrance
        orientations; tax equalization calculations; tax
        noticing; other compliance services; year-end w-2
        processing; fiscal year compensation reporting; 2001 tax
        equalization processing; post-assignment support
        services; and compensation worksheet calculations for
        calendar year 2002 for the Debtors' expatriated
        employees;

    (j) assisting the Debtors in connection with the preparation
        and filing of their registration statements required by
        the SEC in relation to their debt and equity offerings;

    (k) providing other audit, accounting and tax services, as
        may be requested by the Debtors and as may be agreed to
        Deloitte; and

    (l) as agreed to by Deloitte, attending and participating in
        administrative or court appearances consistent with these
        services.

Deloitte will charge the Debtors a base fee that is predicated
on these assumptions:

    (1) timely and accurate completion of the information
        included in the client participation schedule;

    (2) no inefficiencies during the audit process or changes in
        scope caused by events beyond Deloitte's control,
        including, without limitation, procedures relating to the
        application of AICPA Statement of Position 90-7
        (Financial Reporting by Entities in Reorganization under
        the Bankruptcy Code);

    (3) a minimal level of audit adjustments (recorded or
        unrecorded);

    (4) adherence to Deloitte's timing assumptions; and

    (5) timely payment of Deloitte's invoices as they are
        rendered.

To the extent that additional services are required because any
of these assumptions are not realized or Deloitte is asked to
provide additional services, like consultation on accounting or
financial reporting issues related to regulatory, bankruptcy, or
SEC matters, Deloitte will bill the additional time at its
regular hourly rates.

Deloitte will charge base fees for services based on their
hourly rates.  The rates by classification are, at present:

           Senior                  $150 to 270
           Staff                    100 to 225
           Paraprofessional          75 to 125

Deloitte will charge base fees based on a fixed fee per service
or per tax return basis.  To the extent that Deloitte is
required to perform unanticipated work, Deloitte will charge
extra fees. In lieu of detailed time and activity records,
Deloitte's eventual interim fee applications encompassing the
services will briefly summarize the work, except insofar as
Deloitte seeks compensation beyond the base fees.  Deloitte
understands that compensation beyond the base fees will be
subject to the Application, approval and payment procedures that
govern Deloitte's other hourly billings.  This special
arrangement is appropriate because these services represent a
customary and recurring need independent of the Debtors'
bankruptcy process.

For other services, or if Deloitte is required to perform
unanticipated work, Deloitte will charge fees based on its
regular hourly rates.  The rates by classification are, at
present:

           Partner/Director             $570 to 620
           Senior Manager                420 to 500
           Manager                       250 to 480
           Senior                        250 to 360
           Staff                         230 to 260
           Paraprofessional               75 to 125

The hourly rates charged by Deloitte's professionals differ
based on, among other things, each professional's level of
experience, geographic differentials and the complexity of the
service being provided.  In the normal course of business,
Deloitte revises its regular hourly rates to reflect changes in
responsibilities, increased experience, and increased costs of
doing business. Changes in regular hourly rates will be noted on
the invoices for the first time period in which the revised
rates become effective.

The professional fees charged for Deloitte's services are
calculated from the actual hours expended in providing the
services multiplied by the normal hourly billing rates for the
specific personnel involved.  In addition, Deloitte's expenses,
including but not limited to travel, report production and
delivery services will be included in the total amount billed.
Deloitte will maintain detailed, contemporaneous records of time
incurred in connection with the fees charged based on hourly
billing rates by category and nature of the service rendered.

Prior to the Petition Date, Deloitte received a $250,000
retainer for services rendered or to be rendered.  As of the
Petition Date, approximately $215,000 of the Retainer remained
unapplied. The Debtors ask the Court to allow Deloitte to offset
the Retainer against amounts due Deloitte for services rendered
and expenses incurred pursuant to its first interim fee
application. According to Deloitte's books and records, during
the 90-day period prior to the Petition Date, Deloitte received
approximately $1,400,000 (including the Retainer) from the
Debtors for professional services performed and expenses
incurred.  Deloitte was paid approximately $1,500,000 (including
the Retainer) by the Debtors for its professional services and
expenses incurred in the year preceding the Debtors' Petition
Date.

Paul V. Haack of Deloitte relates that the firm researched its
client databases and performed reasonable due diligence to
determine whether it had any relationships with any parties-in-
interest.  Despite these efforts to identify and disclose
Deloitte's connections with the parties-in-interest, because
Deloitte is a nationwide firm with tens of thousands of
employees, and because the Debtors are a large enterprise,
Deloitte is unable to state with certainty that every client
relationship or other connection has been located.  If Deloitte
discovers additional information that requires disclosure, it
will file a supplemental disclosure with the Court promptly.
Additionally, Mr. Haack notes that some professionals that were
formerly associated with Arthur Andersen joined Deloitte.  While
at Andersen, some of these professionals worked on matters
pertaining to the Debtors.  However, these individuals will be
in new and/or separate engagements. (United Airlines Bankruptcy
News, Issue No. 3; Bankruptcy Creditors' Service, Inc., 609/392-
0900)


UNITED AIRLINES: Reports Record 90.7% Revenue Load Factor
---------------------------------------------------------
United Airlines (NYSE: UAL) established a company record revenue
load factor of 90.7 percent on Saturday, Dec. 21, 2002. The
revenue load factor measures the percentage of available seats
filled with revenue-paying passengers.

"Last Saturday United filled the greatest percentage of seats
with revenue passengers of any single day in the airline's 77-
year history dating back to 1926," said Pete McDonald, executive
vice president.  "We are grateful for the support of the nearly
250,000 customers who flew with us that day, the tens of
millions of customers who fly with us year-round and the
employees of United who are delivering exceptional service."

The 90.7 percent load factor shattered a mark of 90.5 percent
that was set Dec. 1, 2002 during the Thanksgiving holiday travel
season.

News releases and other information about United Airlines can be
found at the company's Web site http://www.united.com


UNITED AIRLINES: Files Request for Approval to Impose Wage Cuts
---------------------------------------------------------------
In a filing with the U.S. Bankruptcy Court Friday afternoon, UAL
Corp. (NYSE:UAL), the parent company of United Airlines,
restated that it is moving quickly to address three imperatives
confronting the company and its employees: a financial
imperative driven by the terms of its Debtor-in-Possession
financing, which impose strict deadlines on United's cost-
reduction targets; a transformational imperative, requiring the
company to revamp its business model and compete profitably on a
sustainable basis; and a labor relations imperative, requiring
the company to permanently revamp its wage structures and work
rules to ensure the company can provide well-paying and stable
jobs at a vibrant enterprise.

In its filing, the company said it has reached tentative
agreement with the leadership of four of its six U.S. union
groups -- representing pilots, flight attendants, dispatchers
and meteorologists -- on significant interim wage reductions,
paving the way for United to "exhaust every conceivable means by
which (it can) address (its) transformational and labor
relations imperatives on a collaborative and consensual basis."

United said it expects the interim wage reductions to be put out
for ratification by January 8, 2003.

Additionally, United's motion seeks the court's authority to
impose wage reductions on the company's employees that are
represented by the International Association of Machinists,
which has not agreed to the wage reduction proposals.

"The agreements [Fri]day are a crucial first step in our efforts
to change the way we do business at United," says Glenn Tilton,
chairman, president and chief executive officer. "Our goal
through this whole process is to create a more competitive
airline that develops new business opportunities, responds
creatively to the marketplace and provides stable jobs,
sustainable growth and durability through economic cycles.
[Fri]day, we begin the process of reaching agreements on the
critical work of taking costs out of our system. As we continue
to move forward, we will focus on work rules and scope of work
changes that will give us the flexibility we need to accomplish
our transformation."

The filing was a conditional motion under Section 1113(c) of
Chapter 11 of the U.S. Bankruptcy Code that could ultimately
lead to the rejection of the company's collective bargaining
agreements and the securing of interim wage relief from its
unionized employees. United filed the motion with the U.S.
Bankruptcy Court in the Northern District of Illinois.

United said in its motion that, if approved by the Court and
ratified by union membership, the proposed wage concessions will
take effect January 1, 2003 and will be a significant step in
helping the company to meet the immediate requirements of its
debtor-in-possession financing agreements, which require that
substantial cost reductions be in place by February 15, 2003. In
addition, United told the court that transformation of its
business will require long-term modifications to its labor
agreements -- including work rules and scope of work clauses --
to make the company more competitive.

United said that if the proposed wage concessions are ratified
by the four unions and the Court approves immediate wage relief
from the IAM141 and IAM141-M, it will not seek to proceed to a
Section 1113(c) hearing until March 2003. However, today's
filing of the conditional Section 1113(c) motion would enable
the company, if necessary, to ask Judge Eugene R. Wedoff to set
a Section 1113(c) hearing in time to implement required labor
cost reductions.

Other information about United Airlines can be found at the
company's Web site at http://www.united.com

United Airlines' 10.67% bonds due 2004 (UAL04USR1) are trading
at about 9 cents-on-the-dollar, DebtTraders reports. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=UAL04USR1for
real-time bond pricing.


UNOCAL CORP: Lowers Earnings Guidance for Fourth Quarter 2002
-------------------------------------------------------------
Unocal Corporation (NYSE: UCL) is revising its estimates for
earnings in the fourth quarter.

Unocal said it expects adjusted earnings of 40 to 45 cents per
share. This compares with the company's previous guidance of 50
to 60 cents per share and a Thompson First Call estimate of 51
cents on December 23, 2002.

Changes in commodity prices account for approximately 11 cents
of the revision, with the NYMEX benchmark price per barrel of
crude oil down $1.65 to $28.10 and the NYMEX price of gas per
million British thermal units (mmBtu) down 20 cents to $3.90.

The revision to the earnings estimate also reflects a 4 cent
decrease due to a non-cash charge for Pure Resources, Inc. stock
options that have been converted to options on Unocal common
stock.  These options, covering 4.3 million shares, are treated
as variable compensation.  Since Unocal's acquisition of the
outstanding minority interest in Pure on October 30, Unocal's
share price has increased $4.01 as of December 26.  Accordingly,
this price increase requires an $11 million after-tax charge to
compensation expense for the increased value of these options in
the fourth quarter.

Estimates for fourth quarter production volumes and dry hole
costs are still within the range of estimates disclosed on
October 24, 2002.

The revised estimate for net earnings includes all of the
factors mentioned above as well as a special item for
environmental remediation of sites presently and formerly owned
by the company. This special item accounts for approximately 10
cents of the decrease in Unocal's revised net earnings estimate
for the fourth quarter of between 30 and 35 cents per share.

Unocal is one of the world's leading independent natural gas and
crude oil exploration and production companies.  The company's
oil and gas activities are in North America, Asia, Latin
America, the North Sea, and West Africa. Unocal is also one of
the world's largest producers of geothermal energy with
operations in the Philippines and Indonesia.

At September 30, 2002, Unocal Corp.'s balance sheet shows that
total current liabilities exceeded total current assets by about
$273 million.


US AIRWAYS: Simulator Engineers Ratify Cost-Saving Agreement
------------------------------------------------------------
US Airways simulator engineers, represented by the Transport
Workers Union (TWU) Local 546, ratified an agreement reached in
mid-December on the company's restructuring and efforts to
further reduce costs.

"These employees have done their part in helping to secure their
future and the future of the company. Each ratified agreement
brings us that much closer to a successful restructuring and our
plans to emerge from Chapter 11 in March 2003," said Jerry A.
Glass, US Airways senior vice president of employee relations.

The US Airways Air Line Pilots Association (ALPA) Master
Executive Council, with approximately 4,000 members, ratified
their tentative cost-savings agreement on Dec. 14, 2002. Since
then, tentative agreements have been reached with all other
labor unions. In addition to ALPA, US Airways employees are
represented by the Association of Flight Attendants (AFA), with
approximately 7,500 members; Communications Workers of America
(CWA), with approximately 6,300 members (representing
reservations sales representatives; airport ticket counter and
gate agents); International Association of Machinists (IAM),
with approximately 11,100 members (Locals 141 and 141-M,
representing fleet service workers and mechanics and related),
and TWU, with approximately 300 members (representing
dispatchers, flight crew training instructors, and simulator
engineers).


US AIRWAYS: Gets Nod to Begin Code Sharing with Windward Airways
----------------------------------------------------------------
US Airways and Windward Island Airways received U.S. government
approval to begin code sharing, giving customers the ability to
immediately start making reservations for flights that will
begin on Jan. 13, 2003.

The code share flights, which will connect at St. Maarten, will
bring US Airways customers expanded access to six Caribbean
destinations: Anguilla, Saba, St. Eustatius, St. Kitts, Nevis
and St. Barthelemy, and customers on flights from the Caribbean
will be able to access all 203 cities served by US Airways
across the U.S., Canada and Europe.

Code share flights offer the convenience of single-carrier
ticketing, schedule coordination at St. Maarten, and check-in
through to the destination by either US Airways or Winair at the
originating station.

"This code share is the next forward step in our GoCaribbean
expansion," said Douglas Leo, US Airways vice president of
international.  "As a result, US Airways anticipates the
continuation of daily service to St. Maarten through the summer
for the first time beginning in 2003, based on the strength
of the GoCaribbean network relationship with Winair."

"This is a significant step in guaranteeing greater breadth of
service through convenient connections with Winair at our in-
transit facility.  We are both pleased and proud to have reached
this important code-share agreement with US Airways," said John
Strugnell, Winair managing director.  "With more than 42 years
of service to the surrounding islands, we look forward to our
new relationship with US Airways."

Customers can connect to Winair via US Airways flights from two
of its three hubs -- Charlotte, N.C., and Philadelphia -- to St.
Maarten.

The agreement also provides affiliation through US Airways'
Dividend Miles frequent traveler program, enabling travelers to
earn and redeem miles on all Winair flights starting Jan 13,
2003, including those operated under the code share.  Miles and
segments earned on Winair will count toward earning Dividend
Miles Preferred status.  The new partnership also introduces an
intra-Caribbean award for 15,000 Dividend Miles, valid on all
Winair flights throughout the Caribbean.  Visit
http://www.usairways.comfor full terms and conditions.

US Airways currently serves the following Caribbean
destinations: Antigua, Aruba, Barbados, Belize, Bermuda, Cancun,
Cozumel, Grand Bahama Island, Grand Cayman, Grenada, Montego
Bay, Nassau, Providenciales, Punta Cana, San Juan, Santo
Domingo, St. Croix, St. Kitts, St. Lucia, St. Maarten, and St.
Thomas. US Airways Express also serves North Eleuthera,
Governors Harbour, Marsh Harbour and Treasure Cay from select
cities in Florida.

DebtTraders says that US Airways Inc.'s 9.625% bonds due 2003
(U03USR1) are trading at about 10 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=U03USR1for
real-time bond pricing.


VENTURES NATIONAL: Stonefield Josephson Airs Going Concern Doubt
----------------------------------------------------------------
Ventures National Inc., is a manufacturer of time sensitive,
high tech, prototype and pre-production printed circuit boards
with the equipment capability for expansion to include backplane
assembly. It provides time-critical printed circuit board
manufacturing services to original equipment manufacturers and
electronic manufacturing services providers. Its prototype
printed circuit boards serve as the foundation in many
electronic products used in telecommunications, medical devices,
automotive, military applications, aviation components,
networking and computer equipment. Its time sensitive and high
quality manufacturing services enable its customers to shorten
their time-to-market cycle time throughout their product's
research and development phase as well as their product's
introduction and ramp-up phase, thus increasing their
competitive position. The Company's focus is on high quality
niche printed circuit boards consisting of complex, multi-
layered, fine-lines and high-performance materials with delivery
cycles between 24 hours and standard 10 day lead times at a
value-added price.

Beginning in the year 2001, Titan began acquiring cutting edge
technology equipment and processes from competitors unable to
remain in business due to a severe market downturn and
overwhelming debt. Titan has also obtained customer lists and
orders from several of these firms, resulting in new business
opportunities.  The Company has no material operations other
than those of Titan.

For the fiscal year ended August 31, 2002, Ventures derived 41%
of its revenues from sales of printed circuit boards to ten
customers. As of August 31, 2002, it had a working capital
deficit of $2,733,403, and total stockholders' deficit of
$519,857. It generated revenues of $8,321,292 for the year ended
August 31, 2002 and incurred a net loss of $1,730,801. In
addition, during the year ended August 31, 2002, net cash used
in operating activities was $539,868.

The following is an excerpt from the report of Stonefield
Josephson, Inc., Certified Public Accountants in Irvine,
California.  It was directed to Ventures National's Board of
Directors and stockholders of the Company regarding their audit
of the Company and is dated October 25, 2002.

"The accompanying consolidated financial statements have been
prepared assuming that the Company will continue as a going
concern. As discussed in Note 1 to the accompanying consolidated
financial statements, the Company's working capital deficit and
significant operating losses raise substantial doubt about its
ability to continue as a going concern. The consolidated
financial statements do not include any adjustments that might
result from the outcome of this uncertainty."


WARNACO GROUP: Court Approves Wachner Claim Settlement Agreement
----------------------------------------------------------------
The Warnaco Group, Inc., and its debtor-affiliates obtained the
Court's approval of their Settlement Agreement with Linda J.
Wachner, which was entered into on November 15, 2002.

Under the Settlement Agreement, the Parties agree that:

    (i) Ms. Wachner will hold an Allowed Administrative Claim in
        these cases for $200,000 that will be paid in full in
        cash on the effective date of a plan of reorganization
        for the Debtors and an allowed prepetition, non-priority
        unsecured claim in these cases for $3,500,000, which will
        be treated under Class 5 of the First Amended Plan;

   (ii) Ms. Wachner will withdraw the Wachner Claim with
        prejudice; and

  (iii) Ms. Wachner will fully release, among others, the
        Debtors, the Debt Coordinators, the Debtors' prepetition
        secured lenders and the Committee. (Warnaco Bankruptcy
        News, Issue No. 39; Bankruptcy Creditors' Service, Inc.,
        609/392-0900)


WESTAR ENERGY: Receives FERC Subpoena to Produce Documents
----------------------------------------------------------
Westar Energy, Inc., (NYSE: WR) received on Dec. 16, 2002, a
subpoena from the Federal Energy Regulatory Commission seeking
details on power trades with Cleco Corporation and its
affiliates, documents concerning power transactions between
Westar Energy's system and marketing operations, and information
on power trades in which Westar Energy or other trading
companies acted as intermediaries.

Cleco publicly disclosed in November that Cleco and its
affiliates had engaged in certain trades that may have violated
FERC affiliate transaction rules applicable to Cleco. The
affiliate transactions involved power sales from one Cleco
affiliate to Westar Energy and then back to another or the same
Cleco affiliate. The transactions totaled approximately $3.4
million in 2000, $12.6 million in 2001 and $3.8 million in 2002.
These amounts on average represented less than 2 percent of
Westar Energy's total power marketing revenues and less than 0.5
percent of Westar Energy's total revenues in 2000 and 2001.

"Despite FERC's notification to us that this matter is non-
public and despite our belief that our participation in these
transactions did not violate FERC rules and regulations, we
believe disclosure of the subpoena is prudent given the
heightened scrutiny of the power trading industry by FERC," said
James Haines, Westar Energy's president and chief executive
officer. "We will provide full and complete responses to the
subpoena."

Among the issues being reviewed by FERC are transactions Westar
Energy conducted with third parties to facilitate power
transfers between Westar Energy's system and marketing
operations. These transactions and other power marketing and
trading activities were recently reviewed in a Kansas
Corporation Commission ordered audit of Westar Energy's power
marketing operations by Navigant Consulting. The audit found no
irregularities in the structure or pricing of the transactions.
The audit report is available on the Kansas Corporation
Commission web site, in the News Releases area of the Westar
Energy web site or by contacting Westar Energy.

Westar Energy, Inc., (NYSE: WR) is a consumer services company
with interests in monitored services and energy. The company has
total assets of approximately $7 billion, including security
company holdings through ownership of Protection One, Inc.,
(NYSE: POI) and Protection One Europe, which have approximately
1.2 million security customers. Westar Energy is the largest
electric utility in Kansas providing service to about 647,000
customers in the state. Westar Energy has nearly 6,000 megawatts
of electric generation capacity and operates and coordinates
more than 34,700 miles of electric distribution and transmission
lines. Through its ownership in ONEOK, Inc. (NYSE: OKE), a
Tulsa, Okla.- based natural gas company, Westar Energy has a
44.7 percent interest in one of the largest natural gas
distribution companies in the nation, serving more than 1.4
million customers.

For more information about Westar Energy, visit us on the
Internet at http://www.wr.com

                         *     *     *

As reported in Troubled Company Reporter's November 13, 2002
edition, Standard & Poor's stated that the ratings on
Westar Energy, Inc., (BB+/Watch Neg/--) and its subsidiary
Kansas Gas & Electric Co., (BB+/ Watch Neg/--) would not be
affected by the indictment of president and chief executive
officer David Wittig on federal charges of conspiracy, fraud,
misapplication of funds and money laundering in connection with
an Arizona real estate deal. The indictment involves Wittig's
personal conduct and does not appear to be related to Westar
Energy. The company has placed Wittig on administrative leave
and intends to promptly appoint an acting president and chief
executive officer. Standard & Poor's said it would continue to
monitor the company for any revisions in strategic direction
that may be occur as a result of the managerial change.


WORLDCOM: Posts $205MM Net Loss on $2.3BB Revenue for October
-------------------------------------------------------------
WorldCom, Inc., filed its October 2002 Monthly Operating Report
with the U.S. Bankruptcy Court for the Southern District of New
York. During the month of October 2002, WorldCom recorded $2.3
billion in revenue, $300 million in earnings before interest,
taxes depreciation and amortization (EBITDA) and a net loss from
continuing operations of $205 million. WorldCom's capital
expenditures for the month were approximately $53 million,
including $22 million for property and equipment and $31 million
for related software.

WorldCom ended October with approximately $2.1 billion in cash
on hand, an increase of $600 million from the beginning of the
month with approximately half of the increase the result of non-
recurring receivables collections.

The financial results discussed in this release and the October
2002 Monthly Operating Report exclude the results of Embratel.
However, this Monthly Operating Report includes a supplemental
schedule that reflects WorldCom's consolidated Statement of
Operations for the third quarter of 2002 ended September 30,
2002, which includes Embratel results. Until WorldCom completes
a thorough balance sheet evaluation, including reviews of
goodwill, property and equipment, accrual balances and
allowances for doubtful accounts, the Company will not issue a
balance sheet or cash flow statement as part of its Monthly
Operating Report.

The Monthly Operating Reports are available on WorldCom's
Restructuring Information Desk at http://www.worldcom.com

Based on current information and a preliminary analysis of its
ability to satisfy outstanding liabilities, WorldCom believes
when it emerges from bankruptcy proceedings, its existing
WorldCom and Intermedia preferred stock and WorldCom group and
MCI group tracking stock issues will have no value.

WorldCom, Inc., (WCOEQ, MCWEQ) is a pre-eminent global
communications provider for the digital generation, operating in
more than 65 countries. With one of the most expansive, wholly-
owned IP networks in the world, WorldCom provides innovative
data and Internet services for businesses to communicate in
today's market. In April 2002, WorldCom launched The
Neighborhood built by MCI - the industry's first truly any-
distance, all-inclusive local and long- distance offering to
consumers for one fixed monthly price. For more information, go
to http://www.worldcom.com

DebtTraders reports that Worldcom Inc.'s 7.875% bonds due 2003
(WCOM03USN1) are trading at about 23 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=WCOM03USN1
for real-time bond pricing.


WORLDCOM INC: Wants to Pull Plug on Sprint Backhaul Agreement
-------------------------------------------------------------
Lori R. Fife, Esq., at Weil Gotshal & Manges LLP, in New York,
recounts that on July 7, 2000, debtor MCI International, Inc.,
entered into a Backhaul Agreement with Sprint Communications
Company L.P. whereby Sprint agreed to lease eight STM-1s of
backhaul capacity to the Debtors for ten years.  In exchange,
the Debtors agreed to pay Sprint a $33,287 monthly charge per
STM-1 of Sprint Backhaul, plus all applicable taxes.  Based on
the lease of eight STM-1s, the monthly charge is $266,296 in the
aggregate and the annual charge is $3,195,552.

Ms. Fife explains that the term "backhaul" means the fiber-optic
transmission cables and related equipment linking an undersea
cable network from the beachfront landing stations of the
undersea cable to the site interface points, which are the
input/output jacks located at a telecommunications carrier's
network access point.  The Debtors already owned or otherwise
obtained capacity on the undersea cable network between the
United States and China, but entered into the Agreement in order
to obtain capacity to transport its telecommunications traffic
from that network to the WorldCom network.

At the time the Agreement was executed, Ms. Fife relates that
the Debtors did not own or have access to sufficient backhaul
capacity with respect to the United States-China Network.  Since
that time, over the course of the past year, the Debtors have
completed construction of their own backhaul for the United
States-China network.  The Debtors' backhaul capacity is
sufficient to carry its current traffic and has ample excess
capacity to satisfy any future requirements.  After completion,
the Debtors began to transfer traffic from the Sprint Backhaul
to its own backhaul.  The transition process was completed on
September 10, 2002 and since that date, the Debtors have not
used any of the Sprint Backhaul capacity under the Agreement.
Consequently, the Debtors no longer need nor utilize the Sprint
Backhaul and they have decided to reject the Agreement.

In view of these factors, the Debtors seek authority to reject
the Agreement effective as of December 4, 2002.

In the course of reviewing their network costs and capacity
needs, the Debtors determined that the Sprint Backhaul was no
longer of any value or utility to them.  According to Ms. Fife,
the Debtors no longer require the capacity provided by the
Agreement, and it is currently sitting idle.  By rejecting the
Agreement, the Debtors will save the estates $3,195,552 in
administrative expense per annum.  Moreover, the Debtors
explored assuming and assigning the Agreement.  However, the
Debtors ascertained that assignment was not a viable option as
the contract rates under the Agreement are currently above
market value. (Worldcom Bankruptcy News, Issue No. 16;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


* BOND PRICING: For the week of Dec. 30, 2002 - Jan. 3, 2003
------------------------------------------------------------

Issuer                                Coupon  Maturity  Price
------                                ------  --------  -----
Adelphia Communications                3.250%  05/01/21     7
Adelphia Communications                6.000%  02/15/06     7
Adelphia Communications               10.875%  10/01/10    38
Advanced Micro Devices Inc.            4.750%  02/01/22    63
AES Corporation                        4.500%  08/15/05    45
AES Corporation                        8.000%  12/31/08    55
AES Corporation                        9.375%  09/15/10    62
AES Corporation                        9.500%  06/01/09    62
Agro-Tech Corp.                        8.625%  10/01/07    73
Akamai Technologies                    5.500%  07/01/07    39
Alaska Communications                  9.375%  05/15/09    74
Allegheny Generating Company           6.875%  09/01/23    74
Alkermes Inc.                          3.750%  02/15/07    62
Alpharma Inc.                          3.000%  06/01/06    74
Amazon.com Inc.                        4.750%  02/01/09    74
American Tower Corp.                   2.250%  10/15/09    70
American Tower Corp.                   5.000%  02/15/10    65
American Tower Corp.                   6.250%  10/15/09    67
American & Foreign Power               5.000%  03/01/30    60
Amkor Technology Inc.                  5.000%  03/15/07    48
AMR Corp.                              9.000%  09/15/16    47
AMR Corp.                              9.750%  08/15/21    48
AMR Corp.                              9.800%  10/01/21    48
AMR Corp.                             10.000%  04/15/21    50
AMR Corp.                             10.200%  03/15/20    51
Argo-Tech Corp.                        8.625%  10/01/07    72
AMR Corporation                        9.000%  09/15/16    74
AMR Corporation                        9.750%  08/15/21    75
AMR Corporation                        9.800%  10/01/21    75
BE Aerospace Inc.                      8.875%  05/01/11    71
Best Buy Co. Inc.                      0.684%  06?27/21    68
Borden Inc.                            7.875%  02/15/23    55
Borden Inc.                            8.375%  04/15/16    60
Borden Inc.                            9.250%  06/15/19    57
Borden Inc.                            9.200%  03/15/21    61
Boston Celtics                         6.000%  06/30/38    65
Brocade Communication Systems          2.000%  01/01/07    71
Building Materials Corp.               8.000%  10/15/07    72
Building Materials Corp.               8.000%  12/01/08    71
Burlington Northern                    3.200%  01/01/45    52
Burlington Northern                    3.800%  01/01/20    73
Calair LLC/Capital                     8.125%  04/01/08    46
Calpine Corp.                          4.000%  12/26/06    49
Calpine Corp.                          8.500%  02/15/11    45
Case Corp.                             7.250%  01/15/16    72
Cell Therapeutic                       5.750%  06/15/08    61
Champion Enterprises                   7.625%  05/15/09    40
Charter Communications, Inc.           4.750%  06/01/06    17
Charter Communications, Inc.           5.750%  10/15/05    23
Charter Communications Holdings        8.625%  04/01/09    46
Ciena Corporation                      3.750%  02/01/08    70
Cincinnati Bell Telephone (Broadwing)  6.300%  12/01/28    67
Cincinnati Bell Inc. (Broadwing)       7.250%  06/15/23    68
CNET Inc.                              5.000%  03/01/06    65
Comcast Corp.                          2.000%  10/15/29    23
Comforce Operating                    12.000%  12/01/07    56
Commscope Inc.                         4.000%  12/15/06    74
Conexant Systems                       4.000%  02/01/07    46
Conexant Systems                       4.250%  05/01/06    51
Conseco Inc.                           8.750%  02/09/04     8
Continental Airlines                   4.500%  02/01/07    43
Continental Airlines                   7.560%  12/01/06    45
Corning Inc.                           3.500%  11/01/08    70
Corning Inc.                           6.300%  03/01/09    75
Corning Inc.                           6.750%  09/15/13    66
Corning Inc.                           6.850%  03/01/29    54
Corning Inc.                           8.875%  08/15/21    70
Corning Glass                          8.875%  03/15/16    75
Cox Communications Inc.                3.000%  03/14/30    33
Cox Communications Inc.                0.348%  02/23/21    71
Cox Communications Inc.                0.426%  04/19/20    45
Cox Communications Inc.                7.750%  11/15/29    29
Crown Cork & Seal                      7.375%  12/15/26    70
Cubist Pharmacy                        5.500%  11/01/08    49
Cummins Engine                         5.650%  03/01/98    62
Dana Corp.                             7.000%  03/01/29    73
Dana Corp.                             7.000%  03/15/28    73
DDI Corp.                              5.250%  03/01/08    19
DDI Corp.                              6.250%  04/01/07    16
Delta Air Lines                        7.900%  12/15/09    72
Delta Air Lines                        8.300%  12/15/29    56
Delta Air Lines                        9.000%  05/15/16    66
Delta Air Lines                        9.250%  03/15/22    63
Delta Air Lines                        9.750%  05/15/21    66
Delta Air Lines                       10.375%  12/15/22    70
EOTT Energy Partner                   11.000%  10/01/09    67
Echostar Communications                4.875%  01/01/07    74
Echostar Communications                5.750%  05/15/08    73
Edison Mission                         9.875%  04/15/11    29
Edison Mission                        10.000%  08/15/08    36
El Paso Corp.                          7.000%  05/15/11    68
El Paso Corp.                          7.750%  01/15/32    59
El Paso Energy                         6.750%  05/15/09    73
El Paso Energy                         8.050%  10/15/30    64
El Paso Natural Gas                    7.500%  11/15/26    57
El Paso Natural Gas                    8.625%  01/15/22    66
Emulex Corp.                           1.750%  02/01/07    72
Enron Corp.                            9.875%  06/15/03    16
Enzon Inc.                             4.500%  07/01/08    74
Equistar Chemicals                     7.550%  02/15/26    75
E*Trade Group                          6.000%  02/01/07    74
Finova Group                           7.500%  11/15/09    36
Fleming Companies Inc.                 5.250%  03/15/09    51
Ford Motor Co.                         6.625%  02/15/28    75
Fort James Corp.                       7.750%  11/15/23    74
General Physics                        6.000%  06/30/04    51
Geo Specialty                         10.125%  08/01/08    57
Georgia-Pacific                        7.375%  12/01/25    72
Great Atlantic                         9.125%  12/15/11    70
Gulf Mobile Ohio                       5.000%  12/01/56    62
Health Management Associates Inc.      0.250%  08/16/20    67
Health Management Associates Inc.      0.250%  08/16/20    67
Human Genome                           3.750%  03/15/07    65
Human Genome                           5.000%  02/01/07    72
I2 Technologies                        5.250%  12/15/06    59
Ikon Office                            6.750%  12/01/25    66
Ikon Office                            7.300%  11/01/27    70
Imcera Group                           7.000%  12/15/13    75
Imclone Systems                        5.500%  03/01/05    67
Inhale Therapeutic Systems Inc.        3.500%  10/17/07    55
Inhale Therapeutic Systems Inc.        5.000%  02/08/07    61
Inland Steel Co.                       7.900%  01/15/07    47
Internet Capital                       5.500%  12/21/04    37
Isis Pharmaceutical                    5.500%  05/01/09    73
Juniper Networks                       4.750%  03/15/07    73
Kmart Corporation                      9.375%  02/01/06    13
Kulicke & Soffa Industries Inc.        4.750%  12/15/06    56
Kulicke & Soffa Industries Inc.        5.250%  08/15/06    61
LTX Corporation                        4.250%  08/15/06    65
Lehman Brothers Holding                8.000%  11/13/03    64
Level 3 Communications                 6.000%  09/15/09    42
Level 3 Communications                 6.000%  03/15/10    41
Level 3 Communications                 9.125%  05/01/08    62
Liberty Media                          3.500%  01/15/31    64
Liberty Media                          3.750%  02/15/30    52
Liberty Media                          4.000%  11/15/29    55
LTX Corp.                              4.250%  08/15/06    63
Lucent Technologies                    5.500%  11/15/08    48
Lucent Technologies                    6.450%  03/15/29    45
Lucent Technologies                    6.500%  01/15/28    43
Lucent Technologies                    7.250%  07/15/06    57
Magellan Health                        9.000%  02/15/08    25
Mail-Well I Corp.                      8.750%  12/15/08    65
Medarex Inc.                           4.500%  07/01/06    63
Mikohn Gaming                         11.875%  08/15/08    74
Mirant Corp.                           5.750%  07/15/07    42
Mirant Americas                        7.200%  10/01/08    49
Mirant Americas                        7.625%  05/01/06    65
Mirant Americas                        8.300%  05/01/11    43
Mirant Americas                        8.500%  10/01/21    36
Missouri Pacific Railroad              4.750%  01/01/20    72
Missouri Pacific Railroad              4.750%  01/01/30    69
Missouri Pacific Railroad              5.000%  01/01/45    60
Motorola Inc.                          5.220%  10/01/21    64
MSX International                     11.375%  01/15/08    66
NTL Communications Corp.               7.000%  12/15/08    19
National Vision                       12.000%  03/30/09    50
Natural Microsystems                   5.000%  10/15/05    58
Nextel Communications                  5.250%  01/15/10    71
Nextel Partners                       11.000%  03/15/10    67
NGC Corp.                              7.625%  10/15/26    56
Noram Energy                           6.000%  03/15/12    72
Northern Pacific Railway               3.000%  01/01/47    51
Northern Telephone Capital             7.875%  06/15/26    60
ON Semiconductor                      12.000%  05/15/08    73
ONI Systems Corporation                5.000%  10/15/05    74
OSI Pharmaceuticals                    4.000%  02/01/09    71
Owens-Illinois Inc.                    7.800%  05/15/18    68
PG&E Gas Transmission                  7.800%  06/01/25    60
Providian Financial                    3.250%  08/15/05    74
PSEG Energy Holdings                   8.500%  06/15/11    74
Quanta Services                        4.000%  07/01/07    56
RF Micro Devices                       3.750%  08/15/05    74
RF Micro Devices                       3.750%  08/15/05    74
Redback Networks                       5.000%  04/01/07    25
SBA Communications                    10.250%  02/01/09    56
SC International Services              9.250%  09/01/07    66
SCI Systems Inc.                       3.000%  03/15/07    70
Sepracor Inc.                          5.000%  02/15/07    62
Sepracor Inc.                          5.750%  11/15/06    66
Silicon Graphics                       5.250%  09/01/04    54
Sotheby's Holdings                     6.875%  02/01/09    75
TCI Communications Inc.                7.125%  02/15/28    74
TECO Energy Inc.                       7.000%  05/01/12    73
Tenneco Inc.                          11.625%  10/15/09    68
Teradyne Inc.                          3.750%  10/15/06    72
Tesoro Pete Corp.                      9.000%  07/01/08    66
Transwitch Corp.                       4.500%  09/12/05    60
Tribune Company                        2.000%  05/15/29    73
US Airways Passenger                   6.820%  01/30/14    73
Universal Health Services              0.426%  06/23/20    64
US Timberlands                         9.625%  11/15/07    61
Veeco Instrument                       4.125%  12/21/08    72
Vertex Pharmaceuticals                 5.000%  09/19/07    73
Weirton Steel                         10.750%  06/01/05    50
Weirton Steel                         11.375%  07/01/04    52
Westpoint Stevens                      7.875%  06/15/08    24
Williams Companies                     6.625%  11/15/04    65
Williams Companies                     6.750%  01/15/06    65
Williams Companies                     7.125%  09/01/11    73
Williams Companies                     7.625%  07/15/19    63
Williams Companies                     7.750%  06/15/31    59
Williams Companies                     7.875%  09/01/21    63
Williams Companies                     9.375%  11/15/21    73
Witco Corp.                            6.875%  02/01/26    69
Xerox Corp.                            0.570%  04/21/18    63

                           *********

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.

Each Tuesday edition of the TCR contains a list of companies
with insolvent balance sheets whose shares trade higher than $3
per share in public markets.  At first glance, this list may
look like the definitive compilation of stocks that are ideal to
sell short.  Don't be fooled.  Assets, for example, reported at
historical cost net of depreciation may understate the true
value of a firm's assets.  A company may establish reserves on
its balance sheet for liabilities that may never materialize.
The prices at which equity securities trade in public market are
determined by more than a balance sheet solvency test.

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

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

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

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

                           *********

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

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

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

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

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

                 *** End of Transmission ***