TCR_Public/030110.mbx          T R O U B L E D   C O M P A N Y   R E P O R T E R

              Friday, January 10, 2003, Vol. 7, No. 7


ACORN PRODUCTS: Will Remain Listed on Nasdaq SmallCap Market
ADELPHIA: SDNY Court Extends Schedule Filing Period to April 23
ADVANCED GLASSFIBER: Proskauer Rose Hired as Bankruptcy Counsel
AGERE SYSTEMS: Inks $150 Million Supply Agreement with Samsung
ALLMERICA FIN'L: Initiating Steps to Improve Capital Position

ALLMERICA: Selling $90-Mil. Life Insurance Unit to John Hancock
AMERCO: Reaches Agreement with Bank Group to Restructure Debt
AMERICREDIT: Extends Exchange Offer of 9-1/4% Notes to Jan. 21
ASPECT COMMS: Settles UK Property Lease Dispute with USS
ATLAS AIR: Obtains Covenant Default Waiver from Bank Lenders

AVATEX CORP: Gets Interim Nod to Hire Neligan Tarpley as Counsel
AVITAR: Recurring Losses Prompt Going Concern Uncertainty
BIKE ATHLETIC: Committee Retains Trenwith as Investment Banker
BUDGET: Court Allows $2MM Loan for Budget Germany Equity Boost
BULL RUN: Shareholders to Convene on February 13 in Atlanta, GA

CASTLE DENTAL CENTERS: Annual Meeting Set for January 28, 2003
CENDANT: Using $2B Senior Notes Offering Proceeds to Repay Debts
CONNECTOR 2000: S&P Lowers Toll Road Revenue Bond Rating to B-
CONSECO INC: Seeks to Bring-In Lazard as Investment Banker
COVANTA ENERGY: Obtains Court Nod to Enter into Two Unwind Pacts

COVISTA COMMS: Maintains Nasdaq National Market Listing
COVISTA COMMS: Completes Shareholder-Approved Equity Financing
DICE INC: Scott Wainner's Arbitration Award Claim Paid in Full
DIRECTV L.A.: Turning to AlixPartners for Restructuring Advice
DLJ COMMERCIAL: Fitch Junks Ratings on Class B-8 & B-9 Notes

EMMIS COMMS: Posts Improved Financial Results in Third Quarter
ENCOMPASS SERVICES: Honoring $160 Million Critical Vendor Claims
ENRON CORP: James Curry Taps Hinton's Services as Counsel
EOTT ENERGY: Court Grants OK to Assume Premium Financing Pacts
EXIDE TECHNOLOGIES: Brings-In AGC as Environmental Consultant

FREDERICK'S OF HOLLYWOOD: Emerges from Chapter 11 Bankruptcy
GEMSTAR-TV GUIDE: Discloses Two Senior Management Appointments
GENTEK INC: Court Permits Issuance of $8-Mil. Cash-Secured Bonds
GENUITY INC: Employing Skadden Arps as Special Counsel
GEOWORKS: For Want of a Quorum, Cancels Wed.'s Special Meeting

HASBRO INC: Will Webcast 4th Quarter Conference Call on Feb. 13
HECLA: Files Registration Statement for Planned Equity Offering
JACK IN THE BOX: S&P Gives BB+ Rating to Planned $300MM Facility
KAISER: Proposes Martin Murphy as Futures Representative
KENTUCKY ELECTRIC: Violates Nasdaq Market's Listing Requirements

KING PHARMACEUTICALS: Meridian Shareholders Approve Acquisition
KMART CORP: Court Fixes Jan. 22, 2003 as Supplemental Bar Date
KSAT: Expects $17.9 Mil. Net Capital Deficiency at December 2002
LERNOUT & HAUSPIE: Settles CFSB Dispute over Mendez Sale Fees
LUBY'S: November Working Capital Deficit Balloons to $5.1 Mill.

LUMENON INNOVATIVE: LILT Unit Granted CCAA Protection in Canada
LYONDELL: Venezuelian Oil Situation Spurs Negative Implications
MAGELLAN HEALTH: Names Rene Lerer Chief Operating Officer
METALS USA: Wants Court to Approve National Steel Stipulation
NAT'L CENTURY: Obtains 60-Day Extension to Lease Decision Period

NEXTEL COMMS: President Airs Greatly Improved Finances in 2002
OWENS: Asks to Stretch Summons Deadline Until March 31, 2003
PACIFICARE HEALTH: Discloses Financial Outlook for 2003
PANACO: AMEX to Delist Shares for Violating Listing Requirements
PHOTOWORKS: Says Existing Cash Sufficient to Fund Near-Term Ops.

QWEST: S&P Raises Ratings on Two Related Transactions to CCC+
SASKATCHEWAN WHEAT: Nonfinancial Default Spurs S&P's Ratings Cut
SEDONA CORP: Shares Knocked Off Nasdaq, Now Trading on OTCBB
SL INDUSTRIES: Sells German Unit Electro-Metall for $11.6 Mill.
SORRENTO: Convertible Debt Holders Support Restructuring Plan

STARWOOD HOTELS: Sets Q4 Earnings Release Date for Jan. 29, 2003
SYBRON DENTAL: First Quarter Conference Call Set for January 28
TEREX CORP: J.C. Watts, Jr. Elected to Board of Directors
TYCO INT'L: Appoints W. Mark Schmitz as Vice President, Finance
TYCO INT'L: Exercises Option to Buy Additional $750MM Debentures

UNITED AIRLINES: Flight Attendants Ratify Interim Relief Pact
UNITED AIRLINES: Applauds Flight Attendants' Support of Pact
UNITED AIRLINES: Seeks to Employ Paul Hastings as Labor Counsel
UNITED STATIONERS: Reports Preliminary Fourth Quarter Results
VENTURE HOLDINGS: Rating on $205M Sr. Notes Cut to Default Level

WORLDCOM INC: Hires PricewaterhouseCoopers as Special Advisors
WORLD HEART: Completes Private Equity Placement

* Wachovia Corporate Reports Changes Within WICG

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


ACORN PRODUCTS: Will Remain Listed on Nasdaq SmallCap Market
Acorn Products, Inc. (Nasdaq:ACRN) announced that the Nasdaq
Listing Qualifications Panel had determined to allow the
continued inclusion of Acorn Products' common stock on the
Nasdaq SmallCap Market, noting that the Company appears to
comply with all quantitative listing requirements.

The Company has been asked to provide additional materials to
the Listing Qualifications Panel to verify that it complies with
all listing requirements. Effective with the open of business on
January 9, 2003, the Company's trading symbol will be changed to
"ACRNC." The "C" will be removed from the Company's symbol once
the Listing Panel has confirmed compliance with all listing

Acorn Products, Inc., through its operating subsidiary
UnionTools, Inc., is a leading manufacturer and marketer of non-
powered lawn and garden tools in the United States. Acorn's
principal products include long handle tools (such as forks,
hoes, rakes and shovels), snow tools, posthole diggers,
wheelbarrows, striking tools 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.

                          *   *   *

As previously reported in the December 30, 2002, issue of the
Troubled Company Reporter, 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.

                   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."

ADELPHIA: SDNY Court Extends Schedule Filing Period to April 23
Judge Gerber of the U.S. Bankruptcy Court for the Southern
District of New York granted Adelphia Communications and its
debtor-affiliates' an extension of their deadline to file their
list of creditors, list of equity security holders, schedules of
assets and liabilities, schedules of executory contracts and
unexpired leases, and statements of financial affairs to April
23, 2003. (Adelphia Bankruptcy News, Issue No. 26; Bankruptcy
Creditors' Service, Inc., 609/392-0900)

ADVANCED GLASSFIBER: Proskauer Rose Hired as Bankruptcy Counsel
Advanced Glassfiber Yarns LLC, and its debtor-affiliates ask for
approval from the U.S. Bankruptcy Court for the District of
Delaware to retain Proskauer Rose LLP as their Bankruptcy

Proskauer Rose is expected to:

      a) advise the Debtors with respect to their powers and
         duties as debtors-in-possession;

      b) represent the Debtors at all hearings on matters
         pertaining to their affairs as debtors-in-possession;

      c) prosecute and defend litigated matters that may
         arise during these Chapter 11 cases;

      d) counsel and represent the Debtors in connection
         with the assumption or rejection of executory contracts
         and leases, administration of claims and numerous other
         bankruptcy-related matters arising from these cases;

      e) assist the Debtors in obtaining confirmation of a
         plan of reorganization, approval of a disclosure
         statement and other matters related thereto;

      f) counsel the Debtors with respect to various corporate
         and litigation matters relating to these Chapter 11
         cases including, but not limited to, employee, finance,
         real estate and tax matters;

      g) counsel the Debtors with respect to general corporate
         advice relating to these Chapter 11 cases, including
         negotiating, structuring, documenting and closing
         business transactions; and

      h) perform all other legal services that are desirable
         and necessary for the efficient and economic
         administration of the Debtors' Chapter 11 cases.

The Firm has indicated its willingness to be retained under a
general retainer and to render legal services at these rates:

           partners            $425 to $700 per hour
           senior counsel      $390 to $525 per hour
           associates          $215 to $400 per hour
           paraprofessionals   $100 to $180 per hour

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., and Scott K. Rutsky, Esq., at Proskauer Rose LLP,
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.

AGERE SYSTEMS: Inks $150 Million Supply Agreement with Samsung
Agere Systems (NYSE: AGR.A, AGR.B) announced an agreement with
Samsung to supply wireless data chipsets and software for use in
Samsung's new generation of advanced mobile phones. With this
supply agreement, valued at more than $150 million over 12
months, Samsung phones will incorporate Agere's Global Packet
Radio System solution.

Samsung's GPRS-enhanced phones offer features that meet the
demands of today's highly sophisticated mobile users, including
high-speed Internet access, digital photo imaging, video
downloading, high-resolution color LCD displays, polyphonic
sound, and Java-enabled video games. Samsung, ranked No. 3 in
global mobile phone sales*, is currently deploying these new
phones worldwide.

"The combination of Agere's system-level expertise with
Samsung's leadership in handset design, display technology and
multi-function integration has produced the most versatile
mobile phones available for consumers today," said Cho Byung-
Duck, Senior Vice President, Samsung Electronics. Samsung
recently recognized Agere with its Best Supplier Award for 2002.

GPRS cell phones are based on the Global System for Mobile
communications standard, which is used in nearly 70 percent of
the world's cell phones. Called 2.5-generation (2.5G)
technology, GPRS is a global technology that enables the
widespread adoption of advanced mobile data services, with the
potential to generate new revenue streams for wireless

"We are extremely pleased to have the opportunity to work with
the rising star in the mobile phone industry," said Luc
Seraphin, vice president of Agere's Mobile Terminals division.
"Our GPRS chipset and software solution provides a flexible
platform that Samsung can easily adapt to create innovative,
next-generation features that differentiate their phones in a
highly competitive market. Agere has enjoyed a long and
productive relationship with Samsung in developing mobile
terminal products, and we are honored to receive its Best
Supplier Award for 2002."

Samsung is offering high-performance, fully featured Class 8
GPRS mobile phone handsets that can receive data at up to 50
kilobits per second. Samsung's SGH-S200 and SGH-S300 phones
feature compact size, tri-band capability, 40-tone polyphonic
sound, high-resolution displays, short messaging capability and
sleek designs. The SGH-V205 phones add a built-in digital camera
and offer multimedia messaging service (MMS) for uploading and
downloading photos.

Agere Systemswhose, $220 million Convertible Notes are rated by
Standard & Poor's at 'B', is a premier provider of advanced
integrated circuit (IC) solutions that access, move and store
network information. Agere's IC solutions form the building
blocks for a broad range of communications and computing
applications. The company is the leader in providing storage
solutions for hard disk drives with its read-channel chips,
preamplifiers and system-on-a-chip solutions, and the No. 2
provider of Wi-Fi solutions for wireless LAN applications. For
network equipment providers, Agere is a leading supplier of ICs
for wired communications, network switching and access, and ATM
and SONET/SDH solutions. In addition, Agere is the No. 2
supplier of application-specific ICs (ASICs) for communications
applications. More information about Agere Systems is available
from its Web site at

ALLMERICA FIN'L: Initiating Steps to Improve Capital Position
Allmerica Financial Corporation (NYSE: AFC) announced a series
of transactions which will significantly improve the statutory
capital positions of its life insurance companies. The benefits
of these actions will be reflected in the statutory capital of
the company's life insurance subsidiaries as of December 31,
2002. Statutory capital is the measure of capital utilized by
insurance industry regulators.

The specific transactions are as follows:

-- Entering into a definitive agreement to sell its fixed
    universal life insurance block of business to John Hancock
    Life Insurance Company

-- Retirement of long-term funding agreements at amounts less
    than statutory carrying values, both through open market
    repurchases and a tender offer

-- Implementation of a new guaranteed minimum death benefit
    (GMDB) mortality reinsurance program

-- Redomestication and reorganization of the internal ownership
    structure of its life insurance subsidiaries

Including the benefit of these actions, statutory capital at
December 31, 2002 is estimated at approximately $475 million for
the combined life insurance subsidiaries, an increase of 46%
from the September 30, 2002 level of $326 million. In addition,
the Risk Based Capital ratio of Allmerica Financial Life
Insurance and Annuity Company, the lead life insurance company
as of December 31, 2002, increased from 133% as of September 30,
2002 to approximately 235% as of December 31, 2002. RBC is a
regulatory method of measuring the minimum amount of capital
appropriate for an insurance company. The first level of
regulatory involvement required as a result of RBC levels, the
so-called "Company Action Level", is between 100% and 125%.

"We are very pleased to announce the completion of the several
initiatives we undertook as part of the restructuring of our
Allmerica Financial Services business to significantly increase
the statutory capital levels of our life insurance
subsidiaries," said Edward J. Parry, III, President of
Allmerica's Asset Accumulation Companies and Allmerica Financial
Corporation's Chief Financial Officer. Parry added, "Most
importantly, these improvements substantially reduce the
sensitivity of our life companies' capital bases to fluctuations
in the equity markets. We estimate that AFLIAC's RBC level as of
December 31, 2002 could have withstood a decline of
approximately 60% in the S&P 500 index from the actual level on
that date before reaching the first RBC level for required
regulatory action."

                Further Details on the Actions

Agreement to sell the company's universal life insurance line of

On December 31, 2002, Allmerica Financial Corporation signed a
definitive agreement to sell through a reinsurance arrangement
its interest in a block of fixed universal life policies to John
Hancock Life Insurance Company, a wholly-owned subsidiary of
John Hancock Financial Services, Inc. (NYSE: JHF). The
transaction, which is subject to customary closing conditions,
including receipt of regulatory approvals and customary
representations and warranties regarding the business being
transferred, is expected to close in January and produce an
increase in statutory surplus of approximately $106 million in
2002. Under the agreement, John Hancock will receive reserves
and a recurring stream of premium payments on the book of
business. John Hancock will assume responsibility for
Allmerica's fixed universal life policies, including claims
payments and other obligations under the policies. Retirement of
long-term funding agreements at amounts less than statutory
accounting carrying values. On December 20, 2002, Allmerica
Financial Corporation successfully completed a tender offer
through which it retired additional long-term funding
agreements. The tender offer was made available to non-United
States holders of certain series of notes previously issued
under a medium term note program. This transaction, together
with open market repurchases of long-term funding agreements
that occurred in the fourth quarter, resulted in the retirement
of a total of $551 million par value of funding agreements at
amounts below face value. This resulted in a net increase in
statutory surplus of the combined life insurance subsidiaries of
approximately $90 million. Implementation of a new guaranteed
minimum death benefit (GMDB) mortality reinsurance program.
Effective December 1, 2002, the company's life subsidiaries
entered into a new mortality reinsurance program covering the
incidence of mortality on its variable annuity policies. This
program provides statutory GMDB reserve relief by reducing the
assumed mortality cost in the establishment of statutory
reserves for GMDB. In addition, the program reduces the
volatility in GMDB reserves associated with future fluctuations
in equity market values. This new agreement is expected to
provide a statutory capital benefit of approximately $40 million
as of December 31, 2002. This benefit will include a capital
contribution of $20 million from Allmerica Financial
Corporation, the holding company, to the life insurance
subsidiaries in consideration of the relief of the holding
company's obligations under an existing GMDB reinsurance
agreement. Redomestication and change in the internal ownership
structure of the life insurance subsidiaries. Effective December
31, 2002, AFLIAC, previously a Delaware domiciled life insurance
company, became a Massachusetts domiciled insurance company and
a direct subsidiary of Allmerica Financial Corporation as well
as the immediate parent of First Allmerica Financial Life
Insurance Company (FAFLIC), which remains a Massachusetts
domiciled insurance company. Under the previous internal
ownership structure, FAFLIC was the immediate parent of AFLIAC
and a direct subsidiary of Allmerica Financial Corporation.

These actions enhance the overall capital position of the life
insurance subsidiaries. AFLIAC will receive the benefit of
FAFLIC's capital base for statutory capital and RBC purposes
through consolidation. AFLIAC's statutory capital and RBC ratios
have increased as a result, and its ability to withstand equity
market volatility is greatly enhanced. In addition, FAFLIC will
have greater insulation from fluctuations in the equity market
as a result of the fact that its financial results will no
longer include those of AFLIAC.

As part of this transaction, AFC's commitment to the
Massachusetts Division of Insurance to maintain a minimum level
of 100% RBC in FAFLIC was replaced by an identical commitment

Goldman, Sachs & Co. advised Allmerica on both the sale of its
fixed universal life block and the funding agreement tender
offer. The company expects to announce fourth quarter results on
February 3, 2003.

                Chief Executive Officer Search Update

The company also has advanced its search for a president and
chief executive officer to succeed John F. O'Brien, who resigned
late last year. Russell Reynolds Associates, a global executive
recruitment and management assessment firm, has been retained as
Allmerica's search partner.

"The process is progressing well," said Michael P. Angelini,
chairman of Allmerica's Board of Directors. "This will continue
to be a priority over the next several months as we plan for an
effective leadership transition."

Allmerica Financial Corporation is the holding company for a
diversified group of insurance and financial services companies
headquartered in Worcester, Mass.

                             *   *   *

As previously reported in the October 30, 2002, edition of the
Troubled Company Reporter, Standard & Poor's Ratings Services
removed from CreditWatch its counterparty credit rating on
Allmerica Financial Corp., and lowered it to double-'B'-minus
from double-'B' following discussions with AFC's management
regarding capitalization and liquidity at the consolidated
insurance company and holding company levels.

Standard & Poor's also said that it removed from CreditWatch and
lowered its various ratings on AFC's operating companies.

The outlook on all these companies is negative.

ALLMERICA: Selling $90-Mil. Life Insurance Unit to John Hancock
John Hancock Financial Services, Inc. (NYSE: JHF) and Allmerica
Financial Corporation (NYSE: AFC) announced that John Hancock
has signed an agreement to reinsure the fixed universal life
insurance business of Allmerica. The transaction, which is
subject to customary closing conditions and representations and
warranties regarding the business being transferred, is valued
at approximately $90 million, and is expected to close in the
first quarter of 2003.

Under the agreement, John Hancock will receive reserves and a
re-occurring stream of premium payments on the book of business.
John Hancock will assume liability for Allmerica's fixed
universal life policies, including claims payments and any other
policy obligations.

"The purchase of Allmerica's fixed universal life business
continues John Hancock's ongoing strategy of growing our core
life businesses," says David F. D'Alessandro, chairman and chief
executive officer of John Hancock. "We are accomplishing this
through sales growth, where we are outpacing the industry as of
third quarter 2002, and by making strategic acquisitions like

The deal provides for Allmerica's in-force fixed universal life
insurance business to be administered by John Hancock, following
a transition period. Integration of John Hancock and Allmerica's
fixed universal life operations is expected to be seamless to
policyholders, without change in the ways policies are
administered. The transaction will not result in any change to
the terms or conditions of the policies.

At closing, the transaction is expected to immediately increase
John Hancock's in-force fixed universal life business by about
20 percent. John Hancock will acquire a business that at
September 30, 2002 had approximately $650 million in account
balances and approximately 48,000 policies in force. The
transaction is expected to be slightly accretive to earnings in
2003, but within overall guidance.

"This transaction is one element of a broader, strategic
restructuring effort that has enabled us to strengthen the
capital of our life insurance companies," said Edward J. Parry,
III, president of Allmerica's Asset Accumulation Companies and
Allmerica's chief financial officer. "We are confident our
clients will benefit from John Hancock's strong customer service
operation and its commitment to further expand its presence in
the universal life insurance business."

"This acquisition will bolster John Hancock's position in the
fixed universal life insurance market," said Michael Bell,
senior executive vice president of Hancock's Retail Sector. "It
gives us a more sizeable block of fixed universal life business
that will provide economies of scale, allowing us to spread
expenses over a broader base. The acquisition also will enable
John Hancock to leverage its investment capabilities to benefit
policyholders and investors."

As of September 30, 2002, John Hancock had fixed universal life
insurance sales of $66.0 million and over 62,000 fixed universal
policies in force, accounting for $3.141 billion in fixed
universal life account value.

John Hancock Financial Services is a leading U.S. financial
services company, providing a broad array of insurance and
investment products and services to retail and institutional
customers. As of September 30, 2002, John Hancock and its
subsidiaries had total assets under management of $121.2
billion. John Hancock was advised on this transaction by Bear,
Stearns & Co. Inc.

Allmerica Financial Corporation is the holding company for a
diversified group of insurance and financial services companies
headquartered in Worcester, Massachusetts.

AMERCO: Reaches Agreement with Bank Group to Restructure Debt
AMERCO (Nasdaq: UHAL), the parent company of U-Haul
International, Inc., announced that, as part of its debt-
restructuring process, it has reached agreements with Bank of
America and Citibank to restructure approximately $26.5 million
in obligations that were in default.

On October 15, 2002, when AMERCO did not make a $100 million
principal payment due to its Series 1997-C Bond Backed Asset
Trust (BBAT) holders, it also did not make payments to Citibank
and Bank of America on related obligations. As a part of the
overall restructuring plan, AMERCO has agreed to pay this and
certain other defaulted obligations by March 31, 2003.

"This is another important step in restructuring AMERCO's debt,"
said Dennis Simon, of Crossroads LLC, a nationally recognized
restructuring firm hired last October to lead the restructuring
effort for AMERCO. "We are pleased with the progress and
appreciate the support from Bank of America and Citibank, and
the confidence that creditors have generally shown."

On December 20, 2002, AMERCO announced that it had received
proposals and had executed term sheets with two other major
financial institutions for up to $650 million in connection with
the Company's planned debt restructuring.

On November 27, 2002, the Company's bank group, of which
Citibank and Bank of America are participants, entered into a
standstill agreement during the pendency of the new financing.
Standstill agreements with other lenders to the Company and with
bondholders are being negotiated and are expected to be in place
as part of the total restructuring picture by the end of

AMERCO is the parent company of U-Haul International, Inc.,
Republic Western Insurance Company, Oxford Life Insurance
Company and Amerco Real Estate Company. U-Haul is the largest
do-it-yourself moving and storage operator in North America.

For more information about AMERCO, visit

AMERICREDIT: Extends Exchange Offer of 9-1/4% Notes to Jan. 21
AmeriCredit Corp. (NYSE:ACF) is revising the extension of its
offer to exchange its 9 1/4% Senior Notes Due 2009 which have
been registered under the Securities Act of 1933, as amended,
for any and for all of its outstanding 9 1/4% Senior Notes Due

The Exchange Offer, originally scheduled to expire at 5:00 p.m.,
New York City time, on January 6, 2003, will now expire at 5:00
p.m., New York City time on January 21, 2003, unless extended.
All other terms and conditions of the Exchange Offer remain the

The Old Notes have not been registered under the Securities Act
and may not be offered or sold except pursuant to an exemption
from, or in a transaction not subject to, the registration
requirements of the Securities Act and applicable state
securities laws.

This press release shall not constitute an offer to sell or the
solicitation of an offer to buy nor shall there be any sale of
the Old Notes or the New Notes in any state in which such offer,
solicitation or sale, would be unlawful prior to registration or
qualification under the securities laws of any such state. The
offer is subject to all the terms and conditions set forth in
the Prospectus, dated December 6, 2002, previously distributed
to holders of the Old Notes.

AmeriCredit Corp. (NYSE:ACF) is the largest independent middle-
market auto finance company in North America. Using its branch
network and strategic alliances with auto groups and banks, the
company purchases retail installment contracts made by auto
dealers to consumers who are typically unable to obtain
financing from traditional sources. AmeriCredit has more than
one million customers throughout the United States and Canada
and more than $15 billion in managed auto receivables. The
company was founded in 1992 and is headquartered in Fort Worth,
Texas. For more information, visit

                          *   *   *

As reported in Troubled Company Reporter's Oct. 1, 2002 edition,
Fitch affirmed the 'BB' rating for AmeriCredit Corp.'s senior
unsecured debt and removed the Rating Watch Negative following
their announcement of the completion of an equity offering in
the amount of $502 million. The Rating Outlook is Stable.
Approximately $375 million of debt is affected by this action.

ASPECT COMMS: Settles UK Property Lease Dispute with USS
Aspect Communications Corporation (Nasdaq: ASPT), the leading
provider of enterprise customer contact solutions, completed a
settlement agreement ending its dispute with Universities
Superannuation Scheme Limited (USS) regarding an Agreement to
Lease between the company and USS.

The settlement finally resolves a long-standing dispute over the
lease of certain real property in the United Kingdom. Under the
agreement, Aspect paid USS approximately US$14,700,000 in
December 2002 and accounted for this settlement in its
restructuring accrual at September 30, 2002.

Commenting on the agreement, Gary A. Wetsel, executive vice
president of finance, chief financial officer and chief
administrative officer for Aspect, noted, "We are pleased to
have reached an agreement with USS that avoids continued,
uncertain and expensive litigation."

Aspect Communications Corporation is the leading provider of
business communications solutions that help companies improve
customer satisfaction, reduce operating costs, gather market
intelligence and increase revenue. Aspect is a trusted mission-
critical partner with over two-thirds of the Fortune 50, daily
managing more than 3 million customer sales and service
professionals worldwide. Aspect is the only company that
provides the mission-critical software platform, development
environment and applications that seamlessly integrate voice-
over-IP, traditional telephony, e-mail, voicemail, Web, fax and
wireless business communications, while guaranteeing investment
protection in a company's front-office, back-office, Internet
and telephony infrastructures. Aspect's leadership in business
communications solutions is based on more than 17 years of
experience and over 8,000 implementations deployed worldwide.
The company is headquartered in San Jose, Calif., with offices
around the world and an extensive global network of systems
integrators, independent software vendors and distribution
partners. For more information, visit Aspect's Web site at
http://www.aspect.comor call 877-621-3692.

                         *   *   *

As previously reported, Standard & Poor's Ratings Services said
that its ratings on Aspect Communication Corp. remain on
CreditWatch with negative implications where they were placed on
October 25, 2002. Standard & Poor's said it will affirm Aspect's
corporate credit rating at 'B' and its subordinated debt ratings
at 'CCC+' following the completion of the sale of $50 million of
preferred convertible stock to a private investor. Completion of
the sale, subject to SEC and shareholder approval, is expected
before the end of the March 31, 2003, quarter. At that point,
Standard & Poor's expects to remove the ratings from
CreditWatch, and the outlook will be negative.

The pending affirmation of the rating is based on Standard &
Poor's assessment of Aspect's capacity to meet the put option on
its subordinated convertible debentures in August 2003.
Bondholders have the right to put the bonds back to Aspect for
settlement in cash or stock or a combination of the two at an
accreted value of $129 million based on the amount of bonds
outstanding as of September 30, 2002.

Aspect has suffered from a difficult purchasing environment and
depressed profitability, combined with limited financial

ATLAS AIR: Obtains Covenant Default Waiver from Bank Lenders
Pursuant to a Jan. 8, 2003, 8K filing, Atlas Air, Inc., a wholly
owned subsidiary of Atlas Air Worldwide Holdings (NYSE: CGO),
announced that it has entered into an amendment and waiver with
its bank lenders to amend certain loan agreements and to waive
certain events of default arising under the loan agreements and
related aircraft leases.

Compliance with various financial covenants has also been waived
through March 31, 2003. The Company expects to discuss financial
covenant levels for the balance of 2003 with its bank lenders
later in the first quarter.

Atlas Air Worldwide Holdings, Inc., is the parent company of
Atlas Air, Inc. and of Polar Air Cargo, Inc. Atlas Air offers
its customers a complete line of freighter services,
specializing in ACMI (Aircraft, Crew, Maintenance, and
Insurance) contracts, utilizing its fleet of B747 aircraft.
Polar's fleet of Boeing 747 freighter aircraft specializes in
time-definite, cost-effective, airport-to-airport scheduled
airfreight service.

DebtTraders reports that Atlas Air Inc.'s 10.750% bonds due 2005
(CGO05USR1) are trading between 35 and 37. See
real-time bond pricing.

AVATEX CORP: Gets Interim Nod to Hire Neligan Tarpley as Counsel
Avatex Corporation and its debtor-affiliates obtained interim
approval from the U.S. Bankruptcy Court for the Northern
District of Texas to employ Neligan, Tarpley, Andrews & Foley,
LLP as their Bankruptcy Counsel.

As Counsel to the Debtors, Neligan Tarpley is expected to:

        a) advise the Debtors of their rights, powers, and duties
           as debtors and debtors-in-possession;

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

        c) prepare on behalf of the Debtors, as debtors-in-
           possession, all necessary motions, applications,
           answers, orders, reports and papers in connection with
           the administration of these estates;

        d) propose on behalf of the Debtors the plan of
           reorganization, related disclosure statement, and any
           revisions, amendments, etc., relating to the foregoing
           documents, and all relates materials; and

        e) perform all other necessary legal services in
           connection with these chapter 11 cases and any other
           bankruptcy related representation which the Debtors

The professionals expected to have primary responsibility for
providing services to the Debtors are:

           Patrick J. Neligan, Jr.  Partner         $425 per hour
           David Ellerbe            Partner         $375 per hour
           Monica Blacker           Associate       $250 per hour
           Cynthia Williams Cole    Associate       $165 per hour
           Carolyn Perkins          Legal Assistant $100 per hour

Avatex Corporation, aka National Intergroup, Inc., aka FoxMeyer
Health Corporation is a holding company with a nearly 50% stake
in drugstore chain Phar-Mor, which has around 75 stores in about
25 states operating under such names as Phar-Mor, Pharmhouse,
and Rx Place.  The Debtors filed for chapter 11 petition on
December 11, 2002.  Patrick J. Neligan, Jr., Esq., at Neligan,
Tarpley, Andrews & Foley, LLP represents the Debtors in their
restructuring efforts.  As of September 30, 2002, The Company
listed $14,758,000 in total assets and $23,318,000 in total

AVITAR: Recurring Losses Prompt Going Concern Uncertainty
Avitar, Inc., through its wholly-owned subsidiary Avitar
Technologies, Inc. develops, manufactures, markets and sells
diagnostic test products and proprietary hydrophilic
polyurethane foam disposables fabricated for medical,
diagnostics, dental and consumer use. During Fiscal 2002, the
Company continued the development and marketing of innovative
point of care oral fluid drugs of abuse tests, which use the
Company's foam as the means for collecting the oral fluid
sample.  The Company also through United States Drug Testing
Laboratories, Inc., a wholly-owned subsidiary of Avitar,
operates a certified laboratory and provides  specialized drug
testing services primarily utilizing hair and meconium as the

Sales for the fiscal year ended September 30, 2002 increased
$3,074,952, or approximately 47%, to $9,617,364 from $6,542,412
for the fiscal year ended September 30, 2001. The results for
Fiscal 2002 primarily reflect  the increase in sales of its
ORALscreen products of approximately $ 2,159,000.

The Company had a net loss of $4,146,066 for Fiscal 2002
compared to a net loss of $6,088,976 for Fiscal 2001.

At September 30, 2002 and September 2001, the Company had
working capital deficiencies of $901,757 and  $958,293
respectively, and cash and cash equivalents of $503,204 and
$245,409, respectively.  Net cash used in operating activities
during Fiscal 2002 amounted to $3,695,518 resulting primarily
from the operating  loss of $4,146,066, a decrease in the
provision for accounts receivable of $51,795 an increase in
inventories of $278,176, an increase in prepaid expenses and
other current assets of $13,440, an increase in other assets of
$38,962 and a decrease in deferred revenue of $350,000;
partially offset by depreciation and amortization of $175,765,
amortization of goodwill of $309,992, a non cash charge for
services of $26,900,  a decrease in accounts receivable of
$224,547 and an increase in accounts payable and accrued
expenses of $445,617.  Net cash provided by financing and
investing activities during Fiscal 2002 was $3,953,313 which
included proceeds from the sale of common stock and warrants of
$1,332,601, proceeds from the exercise of options and warrants
of $1,257,423, net proceeds from short and long term debt of
$1,414,660, proceeds from the collection of subscription
receivable of $60,641, proceeds from the sale of equity
investment and equipment of $31,891; offset in part by purchases
of property and equipment of $143,903.

For the balance of fiscal year 2003, the Company's cash
requirements are expected to include primarily the funding of
operating losses, the payment of outstanding accounts payable,
the repayment of certain notes  payable, the funding of
operating capital to grow the Company's drugs of abuse testing
products and services, and the continued funding for the
development  of its ORALscreen product line.

However, as a result of the Company's recurring losses from
operations and working capital deficit, the report of its
independent certified public accountants relating to the
financial statements for Fiscal 2002  contains an explanatory
paragraph stating substantial doubt about the Company's ability
to continue as a going concern. Such report states that the
ultimate outcome of this matter could not be determined as the
date of such report (November 26, 2002). The Company plans to
address the situation.  However, there are no assurances that
these endeavors will be successful or sufficient.

BIKE ATHLETIC: Committee Retains Trenwith as Investment Banker
Trenwith Securities LLC, an investment banking affiliate of BDO
Seidman LLP, one of the nation's leading professional service
organizations, has been retained by the Official Committee of
Unsecured Creditors of Bike Athletic Company as its exclusive
investment banker to market the assets of Bike -- free of all liabilities and
pending litigation claims pursuant to an auction process in
accordance with section 363 of the U.S. Bankruptcy Code.

Interested parties are encouraged to submit bid proposals by
Thursday, January 23, 2003 or to otherwise participate in the
Sale Auction scheduled for January 29, 2003.

"Founded in 1874 and headquartered in Knoxville, Tennessee, Bike
is a prominent sports products manufacturer and marketer of a
broad range of branded athletic products including team
uniforms, performance and sideline garments, sports medicine
products and protective equipment for both men and women," said
Rick Chance, Managing Director Investment Banking at Trenwith
Securities. "These assets should be particularly attractive to
companies seeking access to the approximately $30 billion
athletic apparel industry or existing competitors seeking to
expand the breadth of their product offerings and market share."

Additionally, an acquisition of Bike's assets will afford the
winning bidder a number of significant growth opportunities,
including the:

- ability to leverage Bike's 129 year old brand name recognition
   and reputation in the markets in which it competes,

- access to Bike's broad line of athletic products,

- ability to create value through increased operational

- ability to accelerate the development of new products,

- potential cross-selling of other related products and/or

For additional information on participation in the Bike auction
process, please contact one of the following Trenwith Securities
professionals: Rick Chance, Managing Director at (714) 668-7364,
Atul Kavthekar, Senior Vice President at (714) 668-7360 or Erik
Jordan, Vice President at (714) 668-7366, or visit Trenwith
Securities on the Web at

Trenwith Securities LLC is an investment banking firm serving
the middle market through restructuring services, institutional
private placements of subordinated debt and equity, M&A advisory
services, recapitalizations and private equity investments.
Established in 1981, Trenwith Securities and its professionals
have advised companies on over 600 transactions with over $20
billion in value.

BDO Seidman, LLP is a leading tax consulting organization and a
national professional services firm providing tax, assurance,
financial advisory and consulting services to private and
publicly traded businesses. For more than 90 years, we have been
dedicated to providing quality service and leadership through
the hands-on involvement of our most experienced and committed
professionals. BDO Seidman serves clients through more than 35
offices and 175 alliance firm locations nationwide. As a member
firm of BDO International, BDO Seidman serves clients by
leveraging a global distribution network of resources comprised
of more than 590 member firm offices in 99 countries.

BUDGET: Court Allows $2MM Loan for Budget Germany Equity Boost
Budget Group Inc., and its debtor-affiliates sought and obtained
Court authority to loan funds to Budget Rent A Car International
Inc. and for BRACII to make equity contributions to Budget
Deutschland GmbH, Autovermietung Westfehling GmbH, and Autohansa
Autovermietung E. Seubert GmbH.

The equity contribution is necessary to avoid the liquidation of
Budget Germany under German law.

Judge Walrath authorizes the Debtors to:

     -- loan funds to Budget International for it to make Equity
        Contributions to Budget Germany;

     -- the amount of cash, if any, transferred pursuant to this
        Order will not exceed $2,000,000;

     -- no Equity Contribution will be made under the terms of
        the Order without the prior approval of the Committee;

     -- the characterization of any amounts paid to Budget
        International or Budget Germany as a "loan" or "equity"
        investment pursuant to the Order or any other order
        relating to infusion of funds into the Debtors' overseas
        operations will be without prejudice to any inter-
        creditor rights or claims among Budget International,
        Budget Group and the other Debtors and their creditors,
        provided however, that in all respects, any
        characterization will remain in effect and be controlling
        for purposes of determining the liability of any director
        or officer of Budget International, Budget Group, or any
        Debtor or any other subsidiary of the Debtors in
        connection with the cash infusion authorized in this
        Order. (Budget Group Bankruptcy News, Issue No. 13;
        Bankruptcy Creditors' Service, Inc., 609/392-0900)

Budget Group Inc.'s 9.125% bonds due 2006 (BD06USR1),
DebtTraders say are trading at 22 cents-on-the-dollar. See
real-time bond pricing.

BULL RUN: Shareholders to Convene on February 13 in Atlanta, GA
The Annual Meeting of Stockholders of Bull Run Corporation, a
Georgia corporation, will be held at 10:00 a.m., local time, on
February 13, 2003, at the offices of Bull Run, 4370 Peachtree
Road, N.E., Atlanta, Georgia, for the following purposes:

         1.  To elect directors.

         2.  To authorize an amendment to Bull Run's Articles of
             Incorporation to effect a stock combination (reverse
             stock split) pursuant to which every 10 shares of
             outstanding common stock would be reclassified into
             one share of common stock, and reducing the
             authorized number of shares of common stock from
             100,000,000 to 25,000,000 shares, if such amendment
             is necessary to maintain compliance with the
             continued listing requirements of The Nasdaq Stock

         3.  To ratify the selection of PricewaterhouseCoopers
             LLP as Bull Run's independent auditors for its
             fiscal year ending August 31, 2003.

         4.  To consider and act upon such other business as may
             properly come before the meeting.

The Board of Directors has fixed the close of business on
January 3, 2003 as the record date for determining the holders
of common stock having the right to receive notice of, and to
vote at, the meeting. Only holders of record of common stock at
the close of business on such date are entitled to notice of,
and to vote at, the meeting.

At August 31, 2002, Bull Run's balance sheet shows a working
capital deficit of about $32 million.

CASTLE DENTAL CENTERS: Annual Meeting Set for January 28, 2003
The 2002 Annual Meeting of Stockholders of Castle Dental
Centers, Inc., will be held at the law offices of Haynes and
Boone, LLP, located at 1000 Louisiana Street, Suite 4300,
Houston, Texas 77002 at 10:00 a.m. on Tuesday, January 28, 2003,
for the following purposes:

      (1)  To elect five directors of the Company to serve on the
           Board of Directors until the Company's 2003 annual
           meeting of stockholders and until their respective
           successors shall have been duly elected and qualified.

      (2)  To amend Article IV of the Company's Certificate of
           Incorporation to authorize the issuance of up to
           82,000,000 additional shares of the Company's common

      (3)  To amend the Company's Certificate of Incorporation in
           order to reduce the par value of the Company's common
           stock and preferred stock from 0.001 to 0.000001.

      (4)  To amend the Company's Certificate of Incorporation to
           delete Article IX in order to permit action by written
           consent of holders of the Company's outstanding voting

      (5)  To amend the Bylaws of the Company to delete Section
           2.14 thereof which requires advance notice by
           stockholders of nominations of directors and all
           matters to be brought before meetings of stockholders.

      (6)  To approve the Castle Dental Centers, Inc. 2002 Stock
           Option Plan.

      (7)  To ratify the selection of PricewaterhouseCoopers LLP
           as the Company's independent certified public
           accountants to audit the Company's consolidated
           financial statements for the year ending December 31,

      (8)  To transact such other business as may properly be
           brought before the meeting or any adjournment thereof.

The holders of record of the Company's common stock and Series
A-1 Convertible Preferred Stock at the close of business on
December 16, 2002 are entitled to notice of and to vote at the
meeting with respect to all proposals.

CENDANT: Using $2B Senior Notes Offering Proceeds to Repay Debts
Cendant Corporation (NYSE: CD) sold in a public offering $2
billion in senior unsecured notes, of which $800 million are to
be issued as five year notes due January 2008 and $1.2 billion
as ten year notes due January 2013.  The proceeds will be used
to repay bank debt of $600 million, resulting primarily from the
Budget acquisition, and to pay debt maturing in 2003, including
$860 million principal amount at maturity of zero coupon
convertible notes putable in May 2003 and $970 million of term
notes due November 2003.  As previously announced, JP Morgan and
Salomon Smith Barney are the joint book-running managers for the
transaction.  The completion of this transaction is scheduled
for Monday, January 13, 2003, subject to customary closing

Cendant's Chief Financial Officer, Kevin M. Sheehan, stated:
"The proceeds from the issuance of these notes, together with
the recently closed $2.9 billion 3-year revolving credit
facility and the Company's anticipated $2.0 billion of free cash
flow in 2003, provide Cendant with ample liquidity and
flexibility to achieve our financial goals."

Cendant Corporation is primarily a provider of travel and
residential real estate services. With approximately 90,000
employees, New York City-based Cendant provides these services
to businesses and consumers in over 100 countries.

At September 30, 2002, Cendant's balance sheet shows that total
current liabilities exceeded total current assets by about $1.3

CONNECTOR 2000: S&P Lowers Toll Road Revenue Bond Rating to B-
Standard & Poor's Ratings Services lowered its rating to 'B-'
from 'BBB-' on Connector 2000 Association Inc., S.C.'s
outstanding senior toll road revenue bonds based on the
continued failure of the association's traffic and revenue to
reach projected levels, among other factors. The outlook on the
bonds, which had been negative, is now stable.

"The association's Southern Connector toll road, which opened in
March 2001, has experienced substantially lower traffic demand
than anticipated-resulting in drastically reduced revenue
performance," said Standard & Poor's credit analyst Laura
Macdonald, who added that traffic has been diminished by the
slowing development in the area. Another credit weakness is the
association's recent tapping of its debt service reserve
account-and the likely continued need to tap this account
through fiscal 2004.

The lowered rating affects approximately $153.6 million in
outstanding toll road revenue bonds.

The Connector 2000 Association Inc. is a nonprofit organization
that was formed in 1996 to construct and operate the Southern
Connector, a 16-mile, four-lane start-up toll road that extends
from the intersection of I-85/185 to the intersection of I-385
in Greenville, South Carolina.

CONSECO INC: Seeks to Bring-In Lazard as Investment Banker
Lazard Freres & Company is an investment banking firm focused on
providing financial advice.  Lazard maintains a presence in the
capital markets and has an asset management business.  It is a
registered broker-dealer and a member of the New York and
American Stock Exchanges, as well as the National Association of
Securities Dealers.

Accordingly, Conseco Inc., and its debtor-affiliates seek Judge
Doyle's authority to employ Lazard as their investment banker.

The Debtors believe that Lazard is uniquely qualified to
represent them since the firm has substantial expertise in
advising troubled companies, debt restructuring, and mergers and
acquisitions.  As the Debtors' prepetition investment banker,
Lazard has developed knowledge of its financial and business
operations.  For example, Lazard has assisted the Debtors in
analyses of financial projections, potential debt capacity,
forecasted cash flows, optimal capital structures, valuations,
creditor strategies and other financial advice.

As postpetition investment banker, Lazard has agreed to:

     (a) identify and/or initiate potential Transactions;

     (b) review and analyze the Debtors' assets and the operating
         and financial strategies of the Debtors;

     (c) review and analyze the Debtors' business plans and
         financial projections by testing assumptions and
         comparing them to historical data and industry trends;

     (d) evaluate the Debtors' debt capacity in light of
         projected cash flows and assist in determining an
         appropriate capital structure;

     (e) review the terms of any proposed Transaction and
         evaluate alternative proposals;

     (f) determine a range of values for the Debtors and any
         securities offered by the Debtors in a Transaction or

     (g) advise the Debtors on the risks and benefits of a
         Transaction and other strategic alternatives to maximize
         the business enterprise value;

     (h) review and analyze proposals the Debtors receive from
         third parties, including proposals for debtor-in-
         possession financing;

     (i) assist in negotiations with parties-in-interest
         including creditors and/or shareholders;

     (j) advise and attend meetings of the Debtors' Board of
         Directors, creditor groups, official constituencies and
         other interested parties;

     (k) participate in hearings before the Bankruptcy Court and
         provide testimony with miscellaneous matters or in
         connection with a proposed Plan;

     (l) assist and evaluate candidates for a potential Conseco
         Finance Transaction, a CCM Sale Transaction or other
         Sale Transactions; and

     (m) render other investment banking services as agreed upon
         by the Debtors and Lazard.

Lazard will seek compensation for its services at $250,000 per
month and reimbursement for expenses.  Lazard will be also
compensated with a $11,000,000 cash fee upon completion of a
Restructuring.  Furthermore, Lazard will be compensated up to
$5,000,000 in a Conseco Finance Restructuring and stands to
receive $1,000,000 if the CCM unit is sold.  Lazard will be paid
additional fees for any other transactions that may be
consummated.  Lazard will file interim and final applications
for allowance of its fees with the Court.  The Debtors are
advised that investment bankers do not keep detailed time
records similar to those of attorneys.

The Debtors disclose that they paid Lazard $2,500,000 for
prepetition services, $123,934 for prepetition out-of-pocket
expenses and $4,000,000 as advance payment for fees.

Frank A. Savage, Managing Director at Lazard, tells the Court
that Lazard undertook a database search to determine whether it
had any conflicts of interest against the Debtors.  Mr. Savage
assures the Court that while the firm may have represented or
currently represents certain parties-in-interest in these cases,
the representation "is only on matters that are totally
unrelated to the Debtors or these cases."  If additional
relationships that warrant disclosure are discovered, Lazard
will promptly file a supplemental affidavit with the Court.

Additionally, through its asset management arm, Lazard Asset
Management, and its Capital Markets unit, Lazard may act as
broker or investment advisor for or trade Conseco securities on
behalf of creditors, equity holders or other parties-in-
interest. Mr. Savage relates that Lazard has in place compliance
procedures to ensure that no confidential or non-public
information will be made available to employees of LAM or CM.
LAM and CM are operated as separate and distinct business units
and are sealed by ethical walls. (Conseco Bankruptcy News, Issue
No. 3; Bankruptcy Creditors' Service, Inc., 609/392-0900)

COVANTA ENERGY: Obtains Court Nod to Enter into Two Unwind Pacts
Covanta Energy Corporation and its debtor-affiliates sought and
obtained Court authority for Covanta Energy Corporation to enter

   (a) a Class A Unwind Agreement pursuant to the term of which
       Covanta would transfer certain Class A distress preferred
       shares to Palladium Finance Corporation I in return for a
       certain senior term loan payable by Palladium being
       transferred to Covanta; and

   (b) a Class II Unwind Agreement, pursuant to which Covanta
       would transfer certain Class II distress preferred shares
       to Senator Finance Corporation II in return for a certain
       secured subordinated loan payable by OSHC being
       transferred to Covanta.

                       Class A Unwind Agreement

Deborah M. Buell, Esq., at Cleary, Gottlieb, Steen & Hamilton,
in New York, relates that in April 1997, Covanta borrowed
$97,000,000 from a syndicated headed by Deutsche Bank AG to
purchase a loan that NationsBank of North Carolina, N.A. and
other had made to Palladium in 1994 in connection with the
construction of the Arena.  The Term Loan was secured by a first
lien on the assets relating to the Arena, and by Covanta's
guarantee of the Manager's obligation to make certain working
capital advances to Palladium.

Pursuant to a Canadian Customs Revenue Agency tax ruling dated
as of December 19, 1997, a special purpose affiliate of
Palladium, Palladium Finance Corporation I -- FinanceCo I --
issued in December 1997, 135,800,000 Class A distress preferred
shares to a consortium of Canadian banks, including the Canadian
Imperial Bank of Commerce for CND$1 per share.  The Class A DPS
transaction was to temporarily reduce the effective cost to
Palladium of servicing the Term Loan.

With the proceeds of the Class A DPS issuance, FinanceCo I
purchased the Term Loan from Covanta, which in turn used the
proceeds to repay the Deutsche Syndicate's loan in full.

As part of the transaction, Covanta and CIBC, as agent of the
Palladium DPS Holders, entered into the Ogden Put/Call Agreement
A, which provided the Palladium DPS Holders with the right to
put the Class A DPS to Covanta for CND$135,8000,000 after five
years or, if earlier, on the occurrence of an Event of
Retraction. Covanta's put obligation under the Ogden Put/Call
Agreement A was secured by a $95,000,000 letter of credit issued
by the Deutsche Syndicate.  Covanta was obligated to reimburse
the Deutsche Syndicate for any amount drawn on the Deutsche
Letter of Credit.

After a series of Events of Retraction in 2002, The Palladium
DPS Holders exercised their rights to put the Class A DPS to
Covanta in March 2002.  In the same month, CIBC drew $86,200,000
from the Deutsche Letter of Credit as payment for the Class A
DPS.  Hence, the Term Loan currently remains in the hands of
FinanceCo I, while Covanta holds the Class A DPS.

Ms. Buell reports that FinanceCo I failed to declare and pay in
full dividends the Class A DPS, which constitute Events of
Retraction.  An Event of Retraction triggers the rights of
Covanta, as holder of Class A DPS, to call the Term Loan
FinanceCo I hold.  Covanta decided to exercise that call option
to protect its interests.  The Debtors, Palladium and other
interested parties propose to enter into the Class A Unwind
Agreement that will contain these basis provisions:

     (a) the parties recognize that Events of Retraction have
         occurred with respect to the Class A DPS, and that
         Covanta has duly exercised its option to call the Term
         Loan from FinanceCo I pursuant to the terms of the Debt
         Put/Call Agreement A;

     (b) Covanta will pay for the purchase of the Term Loan by
         transferring the Class A DPS to FinanceCo I in full
         consideration thereof;

     (c) Palladium consents to the transaction between FinanceCo
         I and Covanta, and agrees that the interest on the Term
         Loan will begin to accrue as of the date of the Class A
         Unwind Agreement; and

     (d) Covanta reserves its right to demand and receive any
         unpaid dividend on the Class A DPS that has accrued and
         remains unpaid as of the date of the Class A Unwind

                     Class II Unwind Agreement

Ms. Buell relates that in January 1999, Covanta made a
CND$30,000,000 subordinated loan to OSHC, secured by
substantially all the assets of the Team, including the National
Hockey League franchise.  Pursuant to a CCRA tax ruling dated as
of January 13, 1999, a special purpose affiliate of OSHC,
Senator Finance Corporation II -- Team FinanceCo II -- issued in
January 1999 30,000,000 of Class II distress preferred shares to
CIBC and HSBC Bank of Canada for CND$1 per share.  Team
FinanceCo II used the Class II DPS proceeds to purchase the
Subordinated Loan from Covanta.

Covanta agreed that the Team DPS Holders could put the Class II
DPS to Covanta for the purchase price of Class II DPS, plus
accrued and unpaid dividends, after five years or upon the
occurrence of an Event of Retraction.  Covanta's obligation to
purchase the Class II DPS was secured by a letter of credit
Fleet Bank issued.  Covanta though has to reimburse Fleet Bank
for any drawn amount on the Fleet Letter of Credit.

A year prior to Petition Date, OSHC failed to comply with
certain financial covenants that constitute an Event of
Retraction.  This triggered the Team DPS Holders' right to put
the Class II DPS to Covanta.  In March 2002, the Team DPS
Holders exercised their right to put the Class II DPS to
Covanta.  CIBS, as agent of the Team DPS Holders, obtained
payment for the Class II DPS by drawing on the Fleet Letter of
Credit.  Accordingly, Fleet Bank demanded from Covanta immediate
reimbursement.  With Covanta's insufficient liquidity, it was
unable to reimburse Fleet Bank for the drawn Fleet Letter of

Thus, Ms. Buell informs Judge Blackshear, the Subordinated Loan
is currently held by Team FinanceCo II while Covanta holds the
Class II DPS.  Covanta decided to call the Subordinated Loan
from Team FinanceCo II to protect its investments.  The
transaction will be bound by the Debtors, OSHC and other
interested parties' entry into the Class II Unwind Agreement for
Covanta to transfer the Class II DPS to Team FinanceCo II in
return for the Subordinated Loan.  The Class II Unwind Agreement
will substantially contain the same terms as the Class A Unwind
Agreement when finalized. (Covanta Bankruptcy News, Issue No.
20; Bankruptcy Creditors' Service, Inc., 609/392-0900)

COVISTA COMMS: Maintains Nasdaq National Market Listing
Covista Communications, Inc. (NASDAQ symbol: CVST) announced
that it will maintain its listing on The Nasdaq National Market.

The Company appeared at an oral hearing of the Nasdaq Listing
Qualifications Panel on December 5, 2002, at which it presented
a detailed definitive plan which the Panel determined would
enable Covista to evidence compliance, within a reasonable
period of time, with all requirements under Nasdaq's Maintenance
Standard 1, and then for sustaining compliance with those
requirements over the long term.

In reviewing the plan, The Listing Qualifications Panel was of
the opinion that Covista will likely report compliance with
Nasdaq's $10,000,000 shareholders' equity standard within the
near term as a result of the recently-approved equity infusions.
The Panel further expressed confidence in Covista's ability to
sustain compliance with the minimum standard given the Company's
projections. The Panel also determined that the Company will
likely evidence compliance with the audit committee requirement
as a result of the recent appointment of W. Thorpe McKenzie to
Covista's Board of Directors. Finally, the Panel acknowledged
Covista's compliance with Nasdaq's minimum market maker
requirement as well as the Company's apparent compliance with
all other requirements for continued listing on The Nasdaq
National Market.

John Leach, President and Chief Executive Officer of Covista,
expressed satisfaction with the determination of the Panel. "We
have never wavered in our belief in the long-term strength and
stability of the Company," said Mr. Leach. "Now that our
confidence has been sustained by the Nasdaq Panel, we look
forward to the continued growth of our business and Covista's
return to profitability."

Covista is a facilities-based long distance telecommunications,
Internet and data services provider with a substantial customer
base in the residential, commercial and wholesale market
segments. Its products and services include a broad range of
voice, data and Internet solutions, including long distance and
toll-free services, calling cards, frame relay, Internet access,
VPN, directory assistance and teleconferencing services. The
wholesale division provides domestic and international
termination services to carriers worldwide. Covista currently
owns and operates switches in New York City, Newark, New Jersey,
Philadelphia, Dallas and Chattanooga, and has announced plans to
expand to an additional switch site in Minneapolis. Covista
operates Network Operations, call center and information
technology facilities in Chattanooga to monitor its switched
network and to coordinate its various services. For information
on becoming a Covista customer, please telephone 800-805-1000 or
visit the Company's Web site at

Covista Communications' July 31, 2002, balance sheet shows that
total current liabilities exceeded total current assets by about
$13 million.

COVISTA COMMS: Completes Shareholder-Approved Equity Financing
Covista Communications, Inc. (NASDAQ symbol: CVST) announced
completion of the previously-reported equity financing approved
by shareholders at the Company's Annual Shareholders Meeting
held on December 19, 2002.

The financing resulted in an increase in Covista's equity of
$13,933,500; elimination of $7,000,000 debt; an increase in
fixed assets, primarily telephone switching equipment, of
$3,400,000; and a cash infusion of $3,533,500. The equity
sources, as previously announced, are $12,500,000 from Covista
Chairman Henry G. Luken, III and $1,433,500 from newly-elected
Director W. Thorpe McKenzie.

John Leach, President and Chief Executive Officer of Covista,
said, "The completion of this equity deal and Mr. McKenzie's
agreement to join the Covista Board accomplish two immediate and
significant objectives. They demonstrate to our customers,
vendors, shareholders and the financial community at large, that
Covista has survived the difficult aftermath of September 11,
2001 and will continue to be a premier provider of
telecommunications services on a national scale." "In addition,"
added Mr. Leach, "the financing dramatically improves the
Company's balance sheet, an objective toward which we have been
working for many months. This is a supreme vote of confidence in
the Company's future, for which we are deeply gratified and
which we believe will be entirely justified."

Covista is a facilities-based long distance telecommunications,
Internet and data services provider with a substantial customer
base in the residential, commercial and wholesale market
segments. Its products and services include a broad range of
voice, data and Internet solutions, including long distance and
toll-free services, calling cards, frame relay, Internet access,
VPN, directory assistance and teleconferencing services. The
wholesale division provides domestic and international
termination services to carriers worldwide. Covista currently
owns and operates switches in New York City, Newark, New Jersey,
Philadelphia, Dallas and Chattanooga, and has announced plans to
expand to an additional switch site in Minneapolis. Covista
operates Network Operations, call center and information
technology facilities in Chattanooga to monitor its switched
network and to coordinate its various services. For information
on becoming a Covista customer, please telephone 800-805-1000 or
visit the Company's Web site at

DICE INC: Scott Wainner's Arbitration Award Claim Paid in Full
Dice Inc. (Nasdaq: DICE), the leading provider of online
recruiting services for technology professionals, reported that
Mr. Scott Wainner was paid $628,000 in full satisfaction
of a $1 million arbitration award issued in August 2002 in favor
of Mr. Wainner against Dice Inc.

As a result of this payment in late December 2002, the company
recorded in the fourth quarter 2002 a reversal of approximately
$400,000 of the $1 million charge taken in the third quarter
2002.  Mr. Wainner has relinquished all rights to any further
claims against the company.

Dice is continuing to seek recovery of the $628,000 from
Jupitermedia Corporation (formerly known as INT Media and under the terms of an Asset Purchase Agreement
dated as of December 22, 2000 pursuant to which Jupitermedia
assumed certain obligations of the company.  Due to the inherent
uncertainties of litigation, the probability of recovery is not
determinable; therefore, no estimate of recovery has been

Dice also reported the early termination of its obligations with
respect to a portion of the space it leases in Urbandale, Iowa.
The company and its landlord have amended the lease to provide
for the company to relinquish all rights to approximately 45,000
sq. ft. of office space beginning in January 2003.  As part of
this transaction, the company will pay to the landlord
approximately $34,000 per year from 2003 through 2011.  The
company recorded a charge, including fees and costs of the
transaction, of approximately $460,000 in the fourth quarter
2002, which is reflected as a reduction of EBITDA.  Of this
amount, $260,000 will be paid during 2003, and the remainder
will be paid during 2004 through 2011.  In addition, the company
will record a non-cash write-off of leasehold improvements of
approximately $400,000.

As a result of the early termination, the company's net lease
obligations will be reduced by approximately $650,000 annually
beginning in 2003 and continuing through 2011.  Dice continues
to lease approximately 24,000 sq. ft. at its Urbandale facility.

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

Dice Inc.'s corporate profile can be viewed by clicking on
Investor Relations at

At September 30, 2002, Dice Inc.'s balance sheet shows a total
shareholders' equity deficit of about $37 million.

DIRECTV L.A.: Turning to AlixPartners for Restructuring Advice
DIRECTV Latin America, LLC, the leading direct-to-home satellite
television service in Latin America and the Caribbean, announced
that it has initiated discussions with certain programmers,
suppliers, lenders and business associates to address the
Company's current financial and operational challenges. The
Company also announced that it has retained AlixPartners, LLC, a
leading turnaround and management services firm, to assist with
its restructuring initiative. Michael A. Feder, a principal at
AlixPartners, has been named Chief Restructuring Officer of
DIRECTV Latin America, reporting to Kevin N. McGrath, Chairman
of DIRECTV Latin America.

DIRECTV Latin America is a Delaware limited liability company
owned by DIRECTV Latin America Holdings, a subsidiary of Hughes
Electronics Corporation; Darlene Investments, LLC, an affiliate
of the Cisneros Group of Companies; and Grupo Clarin.

"We are moving aggressively to implement a plan for DIRECTV
Latin America that is consistent with our overall objectives of
enhanced competitiveness and profitable growth," McGrath said.

"We have started discussions with certain programmers,
suppliers, lenders and business associates in an effort to
resolve issues that have affected the financial performance of
DIRECTV Latin America in recent years, including excessive fixed
costs and a substantial debt burden during a time of economic
deterioration throughout Latin America," McGrath said. "There
are some significant contracts that need to be realigned with
the realities of the marketplace. We will also continue to
encourage programmers and suppliers to share directly and
appropriately the risks of exchange rate fluctuation and
currency devaluation."

McGrath continued, "Our Company's current financial condition is
unacceptable and an effective solution must be executed
urgently. Accordingly, if our discussions do not result in a
reasonable agreement in the near future, we would consider other
options available to the Company, including restructuring the
Company under Chapter 11 of the U.S. bankruptcy law."

The Company does not expect any of the actions it is currently
taking or considering to negatively impact its business
operations in Latin America and the Caribbean. There are no
plans for any of the local operating companies to seek court
protection. Even if the U.S. parent (DIRECTV Latin America, LLC)
does seek court protection, the Company expects that the local
operating companies will continue normal operations.

Over the past 18 months, in response to difficult conditions in
the markets where it operates, DIRECTV Latin America has
concentrated on improving business efficiencies and reducing its
operating costs and cash requirements. Among other actions, the
Company has significantly reduced general and administrative
expenses and headcount, and eliminated all non-essential
business activities and capital expenditures.

"We remain firmly committed to continuing normal business
operations in all of our markets across Latin America and
providing our customers with the best service and widest array
of entertainment options," McGrath said.

                 About AlixPartners, LLC

AlixPartners, LLC, a Delaware limited liability company
(, is an internationally recognized leader
in providing hands-on, results-oriented consulting to solve
operational, financial, transactional and legal challenges for
Fortune 1000 companies. It provides services in performance
improvement, turnaround and restructuring, financial advisory
and information technology. It has more than 170 professionals
in its Detroit, New York, Chicago, Dallas, London and Munich

                 About DIRECTV Latin America

DIRECTV Latin America is the leading direct-to-home satellite
television service in Latin America and the Caribbean. Currently
the service reaches more than 1.6 million customers in the
region, in a total of 28 markets. DIRECTV is currently available
in: Argentina, Brazil, Chile, Colombia, Costa Rica, Ecuador, El
Salvador, Guatemala, Honduras, Mexico, Nicaragua, Panama, Puerto
Rico, Trinidad & Tobago, Uruguay, Venezuela and several
Caribbean island nations.

DIRECTV Latin America, LLC is a multinational company owned by
DIRECTV Latin America Holdings, a subsidiary of Hughes
Electronics Corporation; Darlene Investments, LLC, an affiliate
of the Cisneros Group of Companies, and Grupo Clarin. DIRECTV
Latin America has offices in Buenos Aires, Argentina; Sao Paulo,
Brazil; Cali, Colombia; Mexico City, Mexico; Carolina, Puerto
Rico; Fort Lauderdale, USA and Caracas, Venezuela. For more
information on DIRECTV Latin America please visit

HUGHES is a leading provider of digital television
entertainment, broadband services, satellite-based private
business networks, and global video and data broadcasting. The
earnings of HUGHES, a unit of General Motors Corporation, are
used to calculate the earnings attributable to the General
Motors Class H common stock (NYSE: GMH).

DLJ COMMERCIAL: Fitch Junks Ratings on Class B-8 & B-9 Notes
Fitch Ratings downgrades DLJ Commercial Mortgage Corp., series
2000-CKP1, $16.1 million class B-8 to 'CCC' from 'B' and $6.4
million class B-9 to 'C' from 'B-'. Fitch also affirms the
following classes: $186.3 million class A-1A and $789.4 million
class A-1B at 'AAA'; $51.6 million class A-2 at 'AA'; $58
million class A-3 at 'A'; $16.1 million class A-4 at 'A-'; $16.1
million class B-1 at 'BBB+'; $25.8 million class B-2 at 'BBB';
$12.9 million class B-3 at 'BBB-'; $33.9 million class B-4 at
'BB+'; $17.7 million class B-5 at 'BB'; $9.7 million class B-6
at 'BB-'; and $9.7 million class B-7 at 'B+'. The $16.1 million
class C is not rated by Fitch. The rating actions follow Fitch's
annual review of the transaction, which closed in October 2000.
The downgrades are primarily attributed to the pool's large
exposure to the bankrupt retailer, Kmart. Currently there are 10
loans representing 6.1% of the pool secured by properties with
exposure to Kmart. Kmart has rejected the leases on three of the
properties representing 2% of the pool. Significant losses are
expected on these three loans. As of the December 2002
distribution date, the pool's aggregate certificate balance was
$1.3 billion, down 1.9% from closing.

Key Commercial Mortgage, the master servicer, provided year-end
2001 financials for 99% of the loans by balance. The YE 2001
weighted average debt service coverage ratio was 1.48 times,
compared to 1.39x at YE 2000 and at origination. At YE 2001,
4.9% of the pool reported DSCRs below 1.0x. In addition, nine
loans (4.1%) are currently being specially serviced.

Two loans have investment grade credit assessments by Fitch; the
437 Madison Avenue loan and the Hercules Plaza loan. The 437
Madison Avenue loan, secured by a 783,000 square foot office
property in midtown Manhattan, had a borrower-reported YE 2001
DSCR of 2.60x, compared to an underwritten DSCR of 1.75x. Key
noted that the increase was due to scheduled rent bumps. The
property is currently 98% occupied of which The Omnicom Group,
Inc., rated 'A' by Fitch, occupies 40% of the leasable area
through 2010. The Hercules Plaza loan, secured by a 533,000
square foot single tenant office property in Wilmington, DE, had
a borrower reported YE 2001 DSCR of 2.95x, compared to an
underwritten DSCR of 2.41x. The property is 100% leased to
Hercules, Inc.

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

EMMIS COMMS: Posts Improved Financial Results in Third Quarter
Emmis Communications Corporation (Nasdaq: EMMS) announced
results for its third fiscal quarter ending November 30, 2002.

For its third fiscal quarter, Emmis' broadcast cash flow was
$67.8 million, compared to $49.7 million for the same quarter of
the prior year, an increase of 36%. Net revenue for the quarter
was $155.5 million compared to $138.3 million for the same
quarter of the prior year, an increase of 12%.

"This really was a remarkable period for our company," Emmis
Chairman and CEO Jeff Smulyan said. "We have continued to
dramatically de-lever our balance sheet, and our New York radio
performance has seen a tremendous rebound. Our television group
has performed spectacularly by all measurable standards -- in
addition to great ratings, they outperformed in 13 of the 14
Emmis Television markets."

These results significantly exceed the company's previous
guidance as well as Wall Street estimates for revenues and
broadcast cash flow. Earnings Per Share was $0.16 compared to
($0.29) for the same quarter of the prior year.

On a pro forma basis, net revenue for the quarter increased 15%
and domestic radio net revenue increased 7%. Further, for the
3rd Quarter, Free Cash Flow was $26.6 million compared to $3.6
million in the same quarter of the prior year.

Emmis' after-tax cash flow was $35.6 million, an increase of 86%
from the same quarter of the prior year. ATCF per share in the
third quarter was $0.67, up from $0.40 in the same quarter of
the prior year.

Fall 2002 ratings information for the New York market was
released by Arbitron earlier this week, and Emmis had stellar
results. WQHT ranked a solid #1 in its target demographic (18-
34) with a 9.4 share, 2.6 share points in front of its direct
format competitor. WRKS' best ratings performance since Fall
1999 moved it to #3 25-54 with a 5.0 share, up from 12th place
just last year. WQCD ranked #7 25-54 with a 4.0 share. As a
cluster on a 12+ basis, Fall 2002 marked the highest aggregate
Fall cluster share since 1997.

Emmis' total debt-to-EBIDTA leverage (including senior discount
notes) is now under 7x, compared with Emmis' February 28, 2002
leverage of 9.3x. Based on the guidance for its fiscal fourth
quarter, Emmis' total debt-to-EBITDA leverage should be
approximately 6.5x at February 28, 2003, with the company's
senior bank leverage expected to be under 4x and Emmis Operating
Company's total debt-to-EBITDA leverage expected to be under

During the company's 3rd Quarter, Emmis signed a definitive
agreement with Pegasus Communications Corporation to purchase
WBPG-TV, the WB affiliate in Mobile/Pensacola, which will give
Emmis a second television station in the nation's #63 market.
The transaction is expected to close by the end of March 2003.

Barry Mayo, a radio industry and New York City market veteran,
was named as Senior Vice President/Market Manager of Emmis-New
York in December. Mayo is a co-founder of Broadcasting Partners
Incorporated and has served as a media consultant since 1995.

Paul Fiddick, the co-founder of Heritage Media Corporation and
former President of Multimedia, was named as President of Emmis
International during Emmis' 3rd quarter. In December, an
agreement was reached with the Hungarian broadcasting authority
that resolved pending issues and extended Emmis' national
license in Hungary through 2009.

Also after the quarter end, Peter Lund, the former President and
Chief Executive Officer of CBS Inc. and CBS Television and
Cable, joined the Emmis Board of Directors.

Emmis employees were informed Sept. 6, 2002, of the continuation
of a 10% wage cut which is being supplemented with a
corresponding 10% Emmis stock award. The extension of the plan,
which is completing its first year, is expected to yield cash
savings of approximately $14 million over the next twelve

The Company evaluates performance of its operating entities
based on broadcast cash flow and publishing cash flow.
Management believes that BCF and PCF are useful because they
provide a meaningful comparison of operating performance between
companies in the industry and serve as an indicator of the
market value of a group of stations or publishing entities. BCF
and PCF are generally recognized by the broadcast and publishing
industries as a measure of performance and are used by analysts
who report on the performance of broadcasting and publishing

BCF and PCF are not measures of liquidity or of performance in
accordance with accounting principles generally accepted in the
United States, and should be viewed as a supplement to, and not
a substitute for, our results of operations presented on the
basis of accounting principles generally accepted in the United
States. Specifically, BCF and PCF do not take into account
Emmis' debt service requirements and other commitments and,
accordingly, BCF and PCF are not necessarily indicative of
amounts that may be available for dividends, reinvestment in
Emmis' business or other discretionary uses. Moreover, BCF and
PCF are not standardized measures and may be calculated in a
number of ways. Thus, our calculation of these non-GAAP measures
may not be comparable to such non-GAAP measures calculated by
other companies. Emmis defines BCF and PCF as revenues net of
agency commissions and station operating expenses, excluding
non-cash compensation.

After Tax Cash Flow is defined by the company as net income plus
depreciation and amortization, plus non-cash compensation, plus
non-cash taxes, less preferred dividends, and plus non-cash and
non-recurring items.

The company defines Free Cash Flow as net revenues less segment
operating expenses (other than non-cash compensation), corporate
expenses (other than non-cash compensation), interest expense
(including interest associated with its 12-1/2 % Senior Discount
Notes), cash taxes, capital expenditures, and preferred

            Emmis Communications - Great Media,
              Great People, Great Service(SM)

Emmis Communications is an Indianapolis-based diversified media
firm with radio broadcasting, television broadcasting and
magazine publishing operations. Emmis' 18 FM and 3 AM domestic
radio stations serve the nation's largest markets of New York,
Los Angeles and Chicago as well as Phoenix, St. Louis,
Indianapolis and Terre Haute, IN. In addition, Emmis owns two
radio networks, three international radio stations, 15
television stations, award-winning regional and specialty
magazines, and ancillary businesses in broadcast sales and

                         *    *    *

As reported in Troubled Company Reporter's August 5, 2002
edition, Standard & Poor's Ratings Services assigned its single-
'B'-plus bank loan rating to the $500 million senior secured
term loan B of Emmis Operating Co. All other ratings on Emmis
and its parent company, Emmis Communications Corp., including
the single-'B'-plus corporate credit rating, are affirmed. The
outlook is stable.

ENCOMPASS SERVICES: Honoring $160 Million Critical Vendor Claims
Encompass Services Corporation and its debtor-affiliates
estimate they owe roughly $180,000,000 in trade accounts payable
and that of these outstanding accounts payable, approximately
$160,000,000 is owed to Critical Vendors -- suppliers of
materials, equipment, goods and services with whom the Debtors
continue to do business and whose materials, equipment, goods
and services are essential and critical to the Debtors'

Consequently, Encompass Services Corporation sought and obtained
authority from the U.S. Bankruptcy Court for the Southern
District of Texas to pay the $160 million without further

The Court entered an order providing that:

        (a) When feasible and appropriate in the Debtors'
            business judgment, the Debtors are authorized to
            satisfy a Critical Vendor Claim from available funds
            on these conditions:

             (1) all Critical Vendor Claims will be paid by check
                 or by wire transfer of funds;

             (2) by accepting payment under the terms of the
                 Order, the Critical Vendor agrees to continue
                 extending credit and supplying materials,
                 equipment, goods and/or services to the Debtors
                 and, that credit must generally be provided on
                 ordinary and acceptable terms and conditions
                 that are at least as favorable or better than
                 those provided to the Debtors 120 days prior to
                 the Commencement Date; and

             (3) the Debtors will transmit a copy of the Order to
                 each Critical Vendor to which any payment
                 permitted hereunder is made; and

        (b) A Critical Vendors' acceptance of payment for a
            Critical Vendor Claim is deemed acceptance of the
            terms of the Order. (Encompass Bankruptcy News, Issue
            No. 4; Bankruptcy Creditors' Service, Inc., 609/392-

ENRON CORP: James Curry Taps Hinton's Services as Counsel
James Calvin Curry, a former Enron Corporation Employee, seeks
the Bankruptcy Court's authority for the Debtors to retain
Hinton Sussman Bailey & Davidson LLP as his counsel for an
ongoing government investigation, nunc pro tunc to the March 29,
2002 Swidler Order.

Charles A. Davidson, Esq., at Hinton Sussman Bailey & Davidson,
in Houston, Texas, relates that Mr. Curry was formerly a Tax
Agent at Enron Corporation's Property Tax Department.  As a
result of Mr. Curry's former position, the Harris County
District Attorney's Office issued a grand jury subpoena for him
to appear and give testimony and produce documents in his
possession regarding Enron's property tax rendition practices.
Accordingly, Mr. Curry contacted his Enron supervisor, Warren
Schick, who referred him to Eric S. Hagstette, Esq.  However,
Mr. Hagstette could not represent Mr. Curry due to an actual or
potential conflict of interest between Mr. Curry and Mr. Schick,
his current client.  Mr. Hagstette instead suggested to Mr.
Curry to contact Hinton Sussman about legal representation with
respect to the Investigation.

On July 3, 2002, Hinton Sussman and Mr. Curry entered into a
retainer agreement wherein Hinton Sussman will represent Mr.
Curry with respect to all matters in connection with the ongoing
investigation.  Pursuant to the Agreement, Mr. Curry agreed to
pay hourly billing rates that are generally in effect from time
to time and reimburse Hinton Sussman for its out-of-pocket
costs. Hinton Sussman's current hourly rates for this matter are
$350 each for Mr. Davidson and Joe W. Bailey and $100 for legal
assistants and law clerks.  Hinton Sussman agreed to initially
seek full reimbursement of Mr. Curry's fees and expenses from
the Debtors, then, if unsuccessful, from Mr. Curry directly.

Mr. Davidson explains that even though Mr. Curry is requesting
that the Debtors be responsible for Hinton Sussman's reasonable
attorney's fees and expenses, Hinton Sussman represents only Mr.
Curry and his interests alone.  Thus, the attorney-client
relationship only exists and will continue to exist solely
between Mr. Curry and Hinton Sussman.

According to Mr. Davidson, Hinton Sussman is a "disinterested
person" as that term is defined in Section 101(14) of the
Bankruptcy Code because Hinton Sussman, its partners, counsel
and associates:

     (a) are not creditors, equity security holders or insiders
         of the Debtors;

     (b) are not and were not investment bankers for any
         outstanding security of the Debtors; and

     (c) have certain relationships with certain creditors, other
         parties-in-interest, and other professionals in
         connection with unrelated matters, but has not
         represented any party in connection with matters
         to the Chapter 11 cases, which would preclude Hinton
         Sussman from being retained and paid by the Debtors.

Mr. Davidson contends that the application should be approved
based on Sections 105(a), 327(e) and 363(b) of the Bankruptcy
Code since:

     (a) the Debtors have the authority to retain Hinton Sussman
         to represent Mr. Curry based on the Swidler Retention

     (b) the retention and compensation of counsel for the
         Debtors' current and former employees, who are simply
         witnesses in the Investigation, is a use of the estate's
         property other than in the ordinary course of business;

     (c) the retention and compensation of counsel for the
         Debtors' former employees facilitate the Debtors'
         interest and the public interest in full disclosure.

                            *     *     *

Accordingly, Judge Gonzalez authorizes the Debtors' retention of
Hinton Sussman as counsel for James Calvin Curry in connection
with and through the completion of the Investigation, from June
17, 2002 to October 1, 2002 only.  The Debtors are further
authorized to pay Hinton Sussman $37,708 for the period covered.
Hinton Sussman cannot seek any further compensation for services
rendered to the same period. (Enron Bankruptcy News, Issue No.
52; Bankruptcy Creditors' Service, Inc., 609/392-0900)

EOTT ENERGY: Court Grants OK to Assume Premium Financing Pacts
EOTT Energy Partners, L.P., and its debtor-affiliates must
maintain insurance customary in their business as well as
casualty insurance, workers' compensation insurance, general
liability insurance and product liability insurance, and make
all premium payments on these insurance when due.

Prior to the Petition Date, the Debtors financed their general
liability, property and casualty, and workers' compensation
insurance premiums through Imperial A.I. Credit Companies and
Cananwill, Inc.

Accordingly, the Debtors sought and obtained the Court's
authority to assume the Premium Financing Agreements to give
Imperial and Cananwill the assurances they need to continue
doing business with them.

The Debtors may be required during these Chapter 11 cases to
enter into similar premium financing agreements on new policies
to renew or replace existing policies.  Thus, the Debtors
further obtained the Court's authority to enter into new premium
financing agreements from time to time, as appropriate, without
further Court order.

Instead of filing a new motion to the Court, the Debtors will
notify the U.S. Trustee, the Official Committee of Unsecured
Creditors and secured lenders in writing of their intention to
enter into a new premium financing agreement.  If no objection
is received within five business days after notice, the Debtors
will enter into the new premium financing agreement without
further Court order.  Otherwise, the Debtors will file a motion
with the Court requesting authority to enter into the new
premium financing agreement. (EOTT Energy Bankruptcy News, Issue
No. 8; Bankruptcy Creditors' Service, Inc., 609/392-0900)

DebtTraders reports that EOTT Energy Partners/Fin.'s 11.000%
bonds due 2009 (EOT09USR1) are trading at 57 cents-on-the-
dollar. See
real-time bond pricing.

EXIDE TECHNOLOGIES: Brings-In AGC as Environmental Consultant
Exide Technologies and its debtor-affiliates sought and obtained
the Court's authority to employ Advanced Geoservices Corporation
as its environmental consultant nunc pro tunc to August 1, 2002.

The Debtors previously employed AGC as an ordinary course
professional. However, it is now clear that AGC's fees will
regularly exceed the $50,000 monthly cap provided for in the OCP

As Environmental Consultant, AGC will:

     -- plan and implement environmental compliance,
        investigation and remediation projects;

     -- oversee contractors on several EPA and state-led
        remediation projects; and

     -- render any other environmental consulting services as are
        necessary and appropriate.

AGC will charge its fees based on the time worked on the project
by AGC's professionals, technicians and clerical staff in
accordance with this schedule:

        Field Professional I                     $66
        Field Professional II                     71
        Staff Professional I                      77
        Staff Professional II                     80
        Senior Staff Professional I               87
        Senior Staff Professional II              92
        Senior Staff Professional III             97
        Project Professional                     103
        Senior Project Professional              115
        Associate Project Professional           125
        Project Consultant                       136
        Senior Project Consultant                147
        Consultant                               157
        Senior Consultant                        170

(Exide Bankruptcy News, Issue No. 16; Bankruptcy Creditors'
Service, Inc., 609/392-0900)

FREDERICK'S OF HOLLYWOOD: Emerges from Chapter 11 Bankruptcy
Frederick's of Hollywood announced it has emerged from Chapter
11 bankruptcy. Frederick's emerges with a strong balance sheet,
new financing and positive sales momentum for the first half of
the company's fiscal year.

Frederick's has been operating under Chapter 11 bankruptcy
protection since July 2000. Under Chapter 11, the company has
been implementing its brand turnaround, opening or remodeling
more than 20 stores, introducing numerous new product lines, and
building its website into one of the top 10 retail sites in the
US. The emergence from bankruptcy comes on the heels of a better
than anticipated sales season and at the onset of the key
Valentine's Day selling period.

"We are very pleased to have reached the end of this
reorganization, and to have accomplished so much at the same
time," stated Linda LoRe, CEO and President, Frederick's of
Hollywood. "While under Chapter 11, we made substantial progress
on our efforts to evolve the brand and are poised for positive
growth with new financing, a strong management team and a
reenergized customer base. We all are looking forward to our
continued success in the coming years."

The key elements of the plan include: the conversion of
significant debt to equity by the company's lender group and
general unsecured creditors, the provision of additional
liquidity by members of the company's lender group, a new
revolving credit facility that will allow the company to devote
significant cash to capital expenditures and marketing, the
assumption of substantially all of the company's current store
leases, and the anticipated continuation of the company's senior
management team.

Since 1946, Frederick's of Hollywood has been the leading
innovator in the lingerie industry, creating many of today's top
lingerie styles such as the push-up bra and thong panty.
Customers can shop for Frederick's of Hollywood merchandise at
its 167 stores, via catalog and online at .

GEMSTAR-TV GUIDE: Discloses Two Senior Management Appointments
Gemstar-TV Guide International, Inc. (NASDAQ: GMSTE) named
Stephen H. Kay, a former Hogan & Hartson, L.L.P., partner, as
Executive Vice President and General Counsel and that Jonathan
Orlick, who has been Executive Vice President and General
Counsel for the company, has been appointed to the newly-created
position of President of Intellectual Property for the company.

With his new responsibilities, Mr. Orlick has resigned his
position on the Company's Board of Directors. Both Messrs. Kay
and Orlick will report to Jeff Shell, Gemstar-TV Guide's Chief
Executive Officer.

"Over the past several months, Gemstar-TV Guide has made
significant progress in bolstering our executive team," said Mr.
Shell. "These key senior management appointments are a critical
step in building the world class management team necessary to
reinvigorate our Company's exciting portfolio of assets. With
Steve, we have added an executive who has proven expertise and a
record of achievement in the area of corporate and securities
law that will be a great asset to Gemstar-TV Guide as it
addresses key legal issues. Moreover, it also enables Jon to
devote his full energy and expertise to the management and
development of our crown jewels: our patent portfolio and base
of technology."

In his position, Mr. Kay will manage Gemstar-TV Guide's internal
and external legal teams as they address a wide variety of
business and legal matters. He will also work together with
other key senior management team members as they implement
strategic growth initiatives, providing legal counsel and
expertise on joint ventures, licensing and other transactions.
Mr. Kay joins the Company on a full-time basis this week and
will be based in Los Angeles.

"I'm excited about the opportunity to work with Jeff and the
other senior executives at the company as we pursue Gemstar-TV
Guide's future growth strategy," said Mr. Kay. "I look forward
to using the insight, perspective and experience that I have
gained working with a wide variety of media and technology
companies over the past 15 years to help guide Gemstar towards
realizing its full potential."

Mr. Orlick, as President of Intellectual Property, will be
responsible for managing the intellectual property portfolio for
the company and expanding and building upon the company's key
assets - patents and technology. In addition, he will continue
to provide counsel to the company in his specialized field of
expertise, which includes patent and technology law. He will
continue to be based in Los Angeles.

"This is the ideal opportunity for me to focus more closely on
an area for which I am passionate about - intellectual
property," said Mr. Orlick. "I look forward to working closely
with Jeff as he leads the development of this company in the
years ahead."

Mr. Kay joins Gemstar-TV Guide from Hogan & Hartson L.L.P.,
where he was a partner in the New York office and a member of
the firm's Business and Finance group. Mr. Kay's practice
focused on transactional work, including mergers and
acquisitions, licensing, equity offerings, debt financings,
joint ventures, and venture capital transactions. He also
counseled clients regarding day-to-day general corporate and
securities law matters and worked extensively with clients in
the formation and financing of new ventures. Mr. Kay represented
privately and publicly held corporations, limited liability
companies and partnerships across a wide range of industries. He
negotiated, structured and documented transactions for media and
technology clients, including publishing, television, Internet,
software, film, and sports businesses. Mr. Kay also advised
technology and new media clients on the unique business and
legal issues encountered in the development and
commercialization of innovative technologies and products. Over
the past several years, Mr. Kay has worked extensively with News
Corporation and its Fox Entertainment Group subsidiary, with
particular emphasis on mergers and acquisitions and joint
ventures in the domestic and international pay television area.

Mr. Kay became a partner at Hogan & Hartson in March 2002, as
part of the firm's merger with Squadron, Ellenoff, Plesent &
Sheinfeld, LLP. At Squadron Ellenoff, he was a member of the
Executive Committee and Co-chair of the Corporate, Securities
and Finance department. He joined Squadron Ellenoff in 1987,
becoming a partner of the firm in 1995.

He received his J.D., magna cum laude, from Boston University in
1987 and received his B.A. from the University of California at
Berkeley in 1983.

Prior to his position at Gemstar-TV Guide as Executive Vice
President and General Counsel, Mr. Orlick served from 1996
through March of 2002 as the Deputy General Counsel and as
Senior Vice President, Intellectual Property and Licensing of
the company. He also served as Vice President, Intellectual
Property and Licensing, and General Counsel for StarSight
Telecast, Inc., now a wholly owned subsidiary of Gemstar-TV
Guide, and held various positions at StarSight beginning in

Prior to joining StarSight, Mr. Orlick was Director of
Intellectual Property of AST Research Inc. from 1993-1996,
overseeing all worldwide intellectual property matters,
including intellectual property acquisition, US and foreign
patent prosecution, US and foreign trademark prosecution, patent
and trademark licensing, trade secret protection and litigation
management. During his tenure, he was responsible for technology
dependent contracts and worked closely with inventors and
engineers to facilitate invention disclosure activity in
connection with the company's patent policy.

Mr. Orlick's experience in patent law also includes several
other key positions at leading technology and electronics
companies including Pioneer Electronics (Discovision) and the
Tandy Corporation. He began his law career as a patent attorney
in private practice in Tampa, Florida from 1984-1986 and then as
a patent attorney at the Rockwell International Corporation from

Mr. Orlick received his J.D. and M.B.A from Nova Southeastern
University in 1984 and received his B.S.E.S. in Computer
Engineering Science from the University of South Florida in

Gemstar-TV Guide International, Inc., is a leading media and
technology company focused on consumer television guidance and
home entertainment. The Company's businesses include: television
media and publishing properties; interactive program guide
services and products; and technology and intellectual property
licensing. Additional information about the Company can be found

                       *    *    *

As reported in Troubled Company Reporter's Sept. 9, 2002
edition, Standard & Poor's lowered its corporate credit
and bank loan ratings on Gemstar-TV Guide International Inc., to
double-'B' from double-'B'-plus.

Standard & Poor's said that all of the ratings remain on
CreditWatch with negative implications, where they were placed
on August 15, 2002.

GENTEK INC: Court Permits Issuance of $8-Mil. Cash-Secured Bonds
GenTek Inc., and its debtor affiliates sought and got the
Court's authority to issue ordinary course cash-secured surety
bonds in an amount not to exceed $8,000,000.  The Debtors also
obtained permission to tap, at most, $2,000,000 of the surety
bonds on an interim basis.

Jane M. Leamy, Esq., at Skadden, Arps, Slate, Meagher & Flom
LLP, explained that the Debtors need the issuance of cash-
secured surety bonds in connection with the upcoming bids and
work for municipalities and other customers. In the coming weeks
before the December 3, 2002 omnibus hearing, the Debtors
estimated that bid and performance bonds up to a face amount of
$2,000,000 may be required in connection with the work to be bid
or performed for governmental municipalities and other
customers.  The $2,000,000 cash-secured bonds will prevent the
risk of losing valuable business income streams to competing
bidders, which would result in immediate and irreparable harm to
the Debtors' estates. (GenTek Bankruptcy News, Issue No. 7;
Bankruptcy Creditors' Service, Inc., 609/392-0900)

GENUITY INC: Employing Skadden Arps as Special Counsel
D. Ross Martin, Esq., at Ropes & Gray, in Boston, Massachusetts,
recounts that on the Petition Date, Genuity Inc., and its
debtor-affiliates filed an Application for Order Under Sections
327(a) and 329 of the Bankruptcy Code authorizing the employment
and retention of Skadden Arps Slate Meagher & Flom LLP as
Attorneys for the Debtors.  However, after review of the
Application, the Court noted concerns about Skadden Arps'
representation of Verizon Communications, Inc.  On
December 9, 2002, the Court indicated it believed that Skadden
Arps should not serve as counsel to the
Debtors under Section 327(a).

The Debtors seek to retain the firm of Skadden Arps Slate
Meagher & Flom LLP, as of the Petition Date, to represent the
Debtors as their Special Counsel in connection with their
Chapter 11 cases to perform the legal services that will be
necessary during their Chapter 11 cases.

Mr. Martin explains that the Debtors have requested that Skadden
Arps continue to act as their Special Counsel because of the
firm's prepetition experience with and knowledge of the Debtors
and their businesses, as well as the firm's experience and
knowledge in the field of mergers and acquisitions and numerous
other areas of the law.  The Debtors submit that continued
representation of the Debtors by Skadden Arps is critical to the
success of the Debtors' proposed asset sale to Level 3 because
Skadden Arps is uniquely familiar with all facets of this
proposed transaction, as well as the Debtors' business and legal
affairs generally.

Mr. Martin informs the Court that Skadden Arps will continue to
provide corporate and transactional services with respect to the
proposed asset sale to Level 3 and any alternative bids.
Skadden Arps will not, however, be representing the Debtors
before the Court or handling bankruptcy matters or handling any
matters relating to Verizon or its subsidiaries.  The services
to be provided by Skadden Arps include:

     -- advice with respect to the Asset Purchase Agreement;

     -- negotiating and advising the Debtors with respect to
        alternative bids and related agreements; and

     -- all other corporate and transactional services related to
        or in connection with the transactions contemplated by
        the Asset Purchase Agreement or any alternative asset
        purchase agreements.

Although Ropes & Gray will now be responsible for the Debtors'
bankruptcy matters, Mr. Martin admits that Skadden Arps has been
working on a number of transitional issues, and the Debtors
anticipate that further transitional work will be required to
assist Ropes & Gray in taking over the representation of the
Debtors in bankruptcy matters.  This transitional work will
include coordinating projects underway with the goal of a fluid
transition, informing Ropes & Gray and the Debtors' employees of
the status of numerous matters and contacts from parties-in-
interest, and assisting with and helping to coordinate the
notices required to complete the Level 3 transaction. (Genuity
Bankruptcy News, Issue No. 4; Bankruptcy Creditors' Service,
Inc., 609/392-0900)

GEOWORKS: For Want of a Quorum, Cancels Wed.'s Special Meeting
Geoworks Corporation (OTC Bulletin Board: GWRX), a provider of
leading-edge software design and engineering services to the
mobile and handheld device industry, cancelled its January 8,
2003, special stockholders meeting due to a lack of a quorum.
The meeting was originally scheduled for December 11, 2002 and
was adjourned until on Wednesday.

"Since the votes cast were overwhelmingly in favor of the
company's proposals to sell its UK professional services
business and to liquidate, we are very disappointed that there
were simply not enough votes cast despite numerous mailings and
phone calls," said Steve Mitchell, president and CEO of the
company. "We thank those shareholders who did return their
ballots and our proxy solicitors for all of their efforts. The
company must now rapidly assess its alternatives, including
seeking bankruptcy protection."

Geoworks Corporation is a provider of leading-edge software
design and engineering services to the mobile and handheld
device industry. With nearly two decades of experience
developing wireless operating systems, related applications and
wireless server technology, Geoworks has worked with industry
leaders in mobile phones and mobile data applications including
Mitsubishi Electric Corporation and Nokia. Based in Emeryville,
California, the company also has a European development center
in the United Kingdom. Additional information can be found on
the World Wide Web at

GLOBE-X CANADIANA: Files Defense & Counterclaim Against CINAR
On July 12, 2002 CINAR Corporation announced that it had
petitioned the Supreme Court of Bahamas for permission to wind-
up Globe-X Canadiana Limited and Globe-X Management Limited and
to appoint PricewaterhouseCoopers as liquidator. Such
proceedings were granted on September 5, 2002 and
PricewaterhouseCoopers was appointed as liquidator. Globe-X
subsequently appealed from such decision and such appeal is

Subsequent to petitioning the Supreme Court of Bahamas for
permission to wind-up Globe-X, CINAR petitioned the High Court
of Justice of Anguilla for enforcement of the Bahamas winding-up
order, or alternatively for a winding-up order in Aguilla, since
Globe-X has continued its incorporation under the laws of
Anguilla. Globe-X has filed a Defense and Counterclaim in the
High Court of Justice of Anguilla claiming damages from CINAR
Corporation aggregating CDN$66 million for alleged breach of
contract, defamation and/or malicious falsehood. CINAR
Corporation considers that this Defense and Counterclaim is
without merit and that the allegations of Globe-X are baseless.
CINAR Corporation will continue to vigorously pursue its
proceedings against Globe-X and the recovery of all amounts

CINAR Corporation is an integrated entertainment and education
company involved in the development, production, post-production
and worldwide distribution of non-violent, quality programming
and educational products for children and families. CINAR's web
site is

HASBRO INC: Will Webcast 4th Quarter Conference Call on Feb. 13
Hasbro, Inc. (NYSE:HAS) will webcast its fourth quarter
conference call via the Internet. The call will take place on
Thursday, February 13, 2003, at 9:00 a.m. EST, following the
release of Hasbro's quarterly financial results. The call will
be available to investors and the media on Hasbro's investor
relations home page, at, click on
"Corporate Info", click on "Investor Information", then click on
the webcast microphone.

The audio webcast platform is Microsoft's Windows Media Player.T
To install Windows Media Player prior to the webcast, log on to
and follow the directions.

Hasbro is a worldwide leader in children's and family leisure
time entertainment products and services, including the design,
manufacture and marketing of games and toys ranging from
traditional to high-tech. Both internationally and in the U.S.,
and WIZARDS OF THE COAST brands and products provide the highest
quality and most recognizable play experiences in the world.

                           *   *   *

As previously reported, Fitch Ratings affirmed Hasbro, Inc.'s
'BB' senior unsecured debt rating. In addition, the company's
new $380 million secured bank credit facility was rated 'BB+'.
The new facility, which replaced its previous 'BB+' rated
$650 million facility, continues to be secured by receivables,
inventories and intellectual property.

The ratings reflect the company's strong market presence and its
diverse portfolio of brands balanced against the cyclical and
shifting nature of the toy industry. The ratings also consider
the challenges the company continues to face in refocusing its
strategy on its core brands and its weak financial profile. The
Negative Outlook reflects uncertainty as to the company's
ability to successfully execute its strategy and its ability to
achieve revenue targets for its core brands as well as Star Wars
in 2002.

HECLA: Files Registration Statement for Planned Equity Offering
Hecla Mining Company (NYSE:HL) filed a Registration Statement
with the Securities and Exchange Commission relating to a
proposed underwritten public offering of up to 23 million shares
of its common stock.

Hecla anticipates that the offering may be accomplished within
the next 2-3 weeks. Hecla plans to use the net proceeds of the
offering to fund future exploration and development, working
capital requirements, capital expenditures, possible future
acquisitions and for other general corporate purposes.

Merrill Lynch & Co. is serving as lead manager, and Salomon
Smith Barney and CIBC World Markets Corp. are serving as co-

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

The offering is made only by means of a prospectus constituting
a part of the Registration Statement. A copy of the prospectus
may be obtained from Merrill Lynch & Co., 4 World Financial
Center, New York, New York 10080.

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.

Hecla's Home Page can be accessed on the Internet at:

                           *   *   *

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.

JACK IN THE BOX: S&P Gives BB+ Rating to Planned $300MM Facility
Standard & Poor's Ratings Services assigned its 'BB+' rating to
quick-service restaurant operator Jack in the Box Inc.'s
proposed $300 million senior secured credit facility. Proceeds
from the new credit facility will be used to refinance existing
debt and for general corporate purposes, permitted acquisitions,
and fees and expenses.

At the same time, Standard & Poor's affirmed its 'BB+' corporate
credit rating on Jack in the Box. The outlook is stable. The San
Diego, California-based company had $250 million of funded debt
as of September 29, 2002.

"Jack in the Box's focus on improving food and service resulted
in solid growth in same-store sales growth from 1999 to 2001
despite a very competitive industry environment. However, Jack
in the Box's same-store sales slipped 0.8% in 2002 due to
increased competition and the slower economy," said Standard &
Poor's credit analyst Diane Shand.

Standard & Poor's expects that the company's good operating
efficiency and management's established operating track record
will allow Jack in the Box to maintain its credit quality
despite intense industry competition and expansion into new

Jack in the Box's $300 million secured credit facility is rated
'BB+', the same as the corporate credit rating. The facility is
secured by a first priority perfected interest in 100% of the
capital stock of the subsidiaries and all tangible and
intangible assets (other than real property).

Standard & Poor's believes that Jack in the Box would be
reorganized under a default scenario rather than liquidated
based on its established brand. Furthermore, Standard & Poor's
expects that secured lenders would realize substantial recovery
of principal in the event of a default or bankruptcy.

KAISER: Proposes Martin Murphy as Futures Representative
Kaiser Aluminum & Chemical Corporation has been named as one of
many defendants in a significant number of asbestos-related
lawsuits.  The lawsuits include class action suits alleging
personal injuries due to the plaintiffs' exposure to:

     -- asbestos during, and as a result of, their employment
        with the Debtors; or

     -- products containing asbestos produced or sold by the
        Debtors, especially those products the Debtors have
        manufactured more than 20 years ago.

As of the Petition Date, there were more than 100,000 asbestos-
related personal injury claims pending against the Debtors.
Aside from the existing claims, the Debtors believe that claims
of similar nature may also come into the open.  These claims may
come from individuals who may have been exposed to asbestos or
asbestos-containing products but who have not yet manifested
symptoms of asbestos-related diseases resulting from the

The Debtors believe that the resolution of their asbestos
liabilities in a fair and equitable manner is one of the major
issues they must address as part of their reorganization.  But
to adequately address the asbestos liabilities and to protect
the long-term value of their businesses for all stakeholders,
the Debtors anticipate that they will ultimately need to obtain
certain relief applicable to the Future Claimants.

Presently, the Debtors anticipate that one of the key elements
of a reorganization plan may be a channeling injunction under
Section 524(g) of the Bankruptcy Code, pursuant to which all
current and future asbestos-related personal injury claims and
demands against them will be channeled to a trust established to
assume their liabilities with respect to the asbestos-related
claims and demands.  However, a Section 524(g) channeling
injunction may be issued only if a number of specific conditions
are met, including the appointment of a legal representative for
the purpose of protecting the rights of persons who might
subsequently assert asbestos-related claims or demands against
the Debtors.  Against that backdrop, the Debtors ask the Court
to appoint Martin J. Murphy as the Legal Representative for
Future Asbestos Claimants, nunc pro tunc to December 19, 2002.

Daniel J. DeFranceschi, Esq., at Richards, Layton & Finger,
tells the Court that the Debtors and their advisors have
evaluated several potential candidates to serve as a Futures
Representative.  The Debtors also discussed the appointment of a
Futures Representative with the statutory committees.  Following
careful consideration of the potential candidates for Futures
Representative, the Debtors have determined that Mr. Murphy is
well qualified to represent the interests of the Future
Claimants.  Mr. DeFranceschi notes that both the Creditors'
Committee and the Asbestos Committee support Mr. Murphy's
retention and appointment.

For more than 25 years, Martin Murphy has handled asbestos-
related claims and issues, as well as other mass tort and
product liability matters.  Mr. Murphy served as a Principal for
Davis & Young Co., LPA from 1976 to 1999.  From 1980 to 1990,
Mr. Murphy served as managing principal of Davis & Young and
currently holds a position as Of Counsel with the firm.  During
his tenure with Davis & Young, Mr. Murphy supervised asbestos-
related and product liability cases and represented major
defendants in litigation. Since 1980, he also has consulted for
various entities regarding asbestos claims handling practices
and represented insurers and insureds in asbestos claims
coverage issues.

Mr. Murphy is a fellow in the American College of Trial Lawyers
and the International Academy of Trial Lawyers and the
International Society of Barristers.  He is a Life Delegate of
the Eighth District Judicial Conference.  He is a member of the
litigation section of the Cleveland Bar Association (past
chair), the Ohio State, Cuyahoga County and American Bar
Associations. Mr. Murphy is also a member of the Defense
Research Institute, the Cleveland Association (past president)
and Ohio Association of Civil Trial Attorneys.

The Debtors ask the Court to appoint Mr. Murphy under these
terms and conditions:

A. Appointment

     Mr. Murphy will be appointed for the purpose of protecting
     the rights of persons or entities that may subsequently
     assert future asbestos-related claims or demands against the
     Debtors. Mr. Murphy will have no other obligations except
     those that may be prescribed by Court Orders and those that
     he may accept.

B. Standing

     Mr. Murphy will have standing under Section 1109(b) of the
     Bankruptcy Code to be heard as a party-in-interest in all
     matters relating to the Debtors' Chapter 11 cases and will
     have the powers and duties of a committee as set forth in
     Section 1103 as are appropriate for a Futures

C. Engagement of Professionals

     Mr. Murphy may retain attorneys, and other professionals,
     consistent with Sections 105, 327 and 524(g), subject to
     prior Court approval.

D. Compensation

     Compensation, including professional fees and reimbursement
     of expenses, will be payable to Mr. Murphy and his
     professionals from the Debtors' estates, as appropriate.
     The Debtors will compensate Mr. Murphy at the rate of $400
     per hour.

E. Liability

     Mr. Murphy will not be liable to any person or entity for
     any damages arising from or relating to his performance as
     Futures Representative, including acts or omissions in
     connection with his performance as Futures Representative,
     except for damages caused by his gross negligence or willful
     misconduct.  Mr. Murphy will not be liable to any person as
     a result of any action or omission he may take or make in
     good faith.

F. Indemnification

     The Debtors will indemnify Mr. Murphy for any damages
     arising from or relating to the performance of his duties as
     Futures Representative, except for damages caused by his
     gross negligence or willful misconduct.  The Debtors will
     indemnify Mr. Murphy for damages resulting from an action or
     omission he may take or make in good faith.

G. Right to Receive Notices

     Mr. Murphy and any professionals he retained will be deemed
     members of the "Core Group Service List".

H. Termination of Appointment

     Unless otherwise ordered by this Court, Mr. Murphy's
     appointment as Futures Representative will terminate on
     the confirmation of a reorganization plan in these cases.
     In addition, Mr. Murphy's appointment as Futures
     Representative may be terminated at any time by the entry of
     a Court order, either on its own motion or on a motion of
     any party-in-interest, for cause, including Mr. Murphy's
     death, incapacity or inability to serve as the Futures

The Debtors assure the Court that Mr. Murphy does not hold any
adverse interest to their estates and is a "disinterested
person" within the meaning of Section 101(14) of the Bankruptcy
Code.  He is not affiliated with or representing any person or
entity with claims against, or any other interest in, the
Debtors' estates. (Kaiser Bankruptcy News, Issue No. 20;
Bankruptcy Creditors' Service, Inc., 609/392-0900)

KENTUCKY ELECTRIC: Violates Nasdaq Market's Listing Requirements
Kentucky Electric Steel, Inc. (Nasdaq:KESI) received a Nasdaq
Staff Determination letter indicating that the Company fails to
comply with the market value of publicly-held shares requirement
for continued listing set forth in Marketplace Rule 4310c(7),
and that its securities are therefore subject to delisting from
The Nasdaq SmallCap Market. The Company has decided not to
appeal the Staff Determination. Accordingly, the Company expects
that its common stock will be delisted from the Nasdaq SmallCap
Market at the opening of business on January 10, 2003, as stated
in the Staff Determination.

The Company currently anticipates that its common stock will be
immediately eligible for quotation on the OTC Bulletin Board.
The OTC Bulletin Board is a regulated quotation service that
displays real-time quotes, last-sale prices, and volume
information in over-the-counter securities. Further information
about the OTC Bulletin Board is available at

Independent of the expected delisting from the Nasdaq SmallCap
Market, the Company will remain a reporting company under the
Securities and Exchange Commission rules. The delisting of the
Company's common stock from Nasdaq could have a material adverse
effect on the market price of, and the efficiency of the trading
market for, the Company's common stock.

Kentucky Electric Steel, Inc. is a publicly held company which
operates a specialty steel mini-mill, manufacturing special
quality steel bar flats for the leaf-spring suspension, cold
drawn bar conversion, truck trailer support beam, and steel
service center.

                         *   *   *

As reported in the Troubled Company Reporter's January 3, 2003,
edition, Kentucky Electric Steel, Inc., was unable to file its
Form 10-K financial statements with the SEC for its fiscal year
ended September 28, 2002, within the required period without
unreasonable effort and expense because it is negotiating a
restructuring of its indebtedness under its revolving credit
facility and under its senior notes; if accomplished, such
restructuring is anticipated will have a significant impact on
certain classifications and disclosures required in the
Company's financials and other portions of its Form 10-K.  The
Company's Form 10-K will be filed by the 15th calendar day
following its prescribed due date.

KING PHARMACEUTICALS: Meridian Shareholders Approve Acquisition
King Pharmaceuticals, Inc. (NYSE: KG) and Meridian Medical
Technologies, Inc. (Nasdaq: MTEC) reported that the shareholders
of Meridian approved the previously announced planned
acquisition of Meridian by King. Pursuant to the terms of
the acquisition, Meridian shareholders will receive a cash price
of $44.50 per share of Meridian common stock, totaling $247.8

King, headquartered in Bristol, Tennessee, whose $400 million
bank facilities are currently rated by Standard & Poor's at BB+,
is a vertically integrated pharmaceutical company that
manufactures, markets, and sells primarily branded prescription
pharmaceutical products. King, an S&P 500 Index company, seeks
to capitalize on opportunities in the pharmaceutical industry
created by cost containment initiatives and consolidation among
large global pharmaceutical companies. King's strategy is to
acquire branded pharmaceutical products and to increase their
sales by focused promotion and marketing and through product
life cycle management.

Meridian Medical Technologies, a specialty pharmaceuticals
company, is a world leader in sales of auto-injector drug
delivery systems. Meridian develops health care products
designed to save lives, reduce health care costs and improve
quality of life.

KMART CORP: Court Fixes Jan. 22, 2003 as Supplemental Bar Date
Judge Sonderby establishes January 22, 2003, as the supplemental
bar date for certain personal injury and related creditors of
Kmart Corporation.

                        *   *   *

Pursuant to the Bar Date Order, on April 1, 2002, Kmart
Corporation and its debtor-affiliates sent notice of the July
31, 2002 Bar Date to 1,000,000 potential claimants including:

A. all employees who had worked for them within two years of the
    Petition Date;

B. thousands of vendors who had done business with them in the
    months leading up to the Petition Date, regardless of whether
    the Debtors' books and records listed a balance owing to
    those vendors;

C. thousands of parties to executory contracts and unexpired
    leases, including roughly 5,000 landlords and subtenants; and

D. roughly 20,000 personal injury and related claimants,
    including 3,500 claimants who were involved in pending
    litigation against the Debtors as of the Petition Date.

In preparing the lists, the Debtors' employees and their
financial advisors spent a significant amount of time carefully
reviewing and compiling computer and other files to ensure that
the lists were as complete as possible.

Despite their best efforts, the Debtors recently learned that
the names and addresses of 4,000 personal injury and related
litigation claimants were omitted from the Schedules of Assets
and Liabilities and Statement of Financial Affairs they filed
with the Court on April 15, 2002.  As a consequence, those
claimants were not sent direct mail notice of the Bar Date.

To compensate for their mistakes, the Debtors have prepared --
and will soon file -- an amendment to Schedule F of their
Schedules to reflect the general unsecured creditors that were
previously overlooked.  The Debtors propose to give the
claimants another opportunity to file their claims.

Against that backdrop, the Debtors asked Judge Sonderby to:

    1. establish January 22, 2003 as the deadline for all
       claimants listed on the amendment to the schedules and
       holding or wishing to assert a claim against any of the
       Debtors to file a proof of their claim in these cases; and

    2. establish the later of the Supplemental Bar Date or 30
       days after an amendment notice is served as the deadline
       for current claimants to revise their scheduled claims.

              Parties Required to File Proofs of Claim

The Supplemental Bar Date would apply to any person or entity:

    (a) newly listed in the Amended Schedules whose claim is
        listed as "disputed," "contingent," or "unliquidated" and
        that desires to participate in any of these Chapter 11
        cases or share in any distribution in these Chapter 11

    (b) whose claim is improperly classified in the Amended
        Schedules or is listed in an incorrect amount and that
        desires to have its claim allowed in a classification or
        amount other than as set forth; and

    (c) whose claim against is not listed in the Amended

In addition, any person or entity whose claim arises:

    * from, or as a consequence of a further amendment to the
      Amended Schedules subsequent to service of the Supplemental
      Bar Date Notice; or

    * as a result of any further amendment to the schedules
      subsequent to service of the amendment notice,

may file its proof of claim within 30 days after the amendment
notice is served or be forever barred from doing so.

Mr. Butler advises that those persons or entities required to
file a proof of claim by the Supplemental Bar Date but fails to
do so in a timely manner will be forever barred, estopped, and
enjoined from:

    -- asserting any claim that:

         (i) exceeds the amount, if any, that is set forth in the
             Schedules or the Amended Schedules; or

        (ii) is of a different nature or in a different
             classification -- Unscheduled Claim; and

    -- voting, or receiving distributions under, any
       reorganization plan with respect to an Unscheduled Claim.

                        Claims Not Applicable

These entities need not file their proofs of claim:

    (a) those:

        (1) who agree with the nature, classification, and amount
            of their claim as set forth in the Amended Schedules

        (2) whose claim is not listed as "disputed,"
            "contingent," or "unliquidated" in the Amended

    (b) any entity that has already properly filed a proof of
        claim against the correct Debtor;

    (c) any entity asserting a claim allowable under Sections
        503(b) and 507(a)(1) of the Bankruptcy Code as an
        administrative expense of the Debtors' Chapter 11 cases;

    (d) any entity whose claim previously has been allowed by, or
        paid pursuant to, a Court Order.

Nevertheless, the Debtors retain the right to:

      -- dispute, or assert offsets or defenses against any filed
         claim or any claim listed or reflected in Amended
         Schedules as to the nature, amount, liability,
         classification, or otherwise; or

      -- subsequently designate any claim as disputed,
         contingent, or unliquidated.

               Supplemental Bar Date Notice Procedures

Mr. Butler, relates that the Debtors' claims agent, Trumbull
Services LLC, have already sent all known potential claimants
including the additional claimants a notice of the Supplemental
Bar Date together with a Proof of Claim Form on December 19,
2002.  The Proof of Claim Form states:

      * whether the claimant's claim is listed in the Amended

      * the dollar amount of the claim, if listed;

      * the Debtor for which the claim is scheduled; and

      * whether the claim is listed as disputed, contingent or

The Debtors believe that a 30-days minimum lead-time is more
than enough to allow the claimants to respond to the Notice.
"This time frame is more than adequate given the fact that these
Chapter 11 cases have now been pending for almost a year, and
all personal injury claimants therefore should have, at a
minimum, constructive notice of the pendency of these cases,"
Mr. Butler tells Judge Sonderby.  Mr. Butler also contends that
those personal injury claimants who have not yet filed proofs of
claim clearly should be aware by now of the Chapter 11 cases.

For any Proof of Claim Form to be validly and properly filed:

    -- a signed original of the completed Proof of Claim Form,
       together with accompanying documentation, must be
       delivered  so as to be received by the Claims and Noticing
       Agent no later than 4:00 p.m., Eastern Standard Time, on
       the Supplemental Bar Date at either of these addresses:

         All Mailings:

                     Kmart Corporation, et. al.
                     c/o Trumbull Services LLC
                     P.O. Box 426
                     Windsor, CT 06095

         Overnight Packages Only:

                     Kmart Corporation, et. al.
                     c/o Trumbull Services LLC
                     Griffin Center
                     4 Griffin Road North
                     Windsor, CT 06095

    -- the creditors must submit the proofs of claim in person or
       by courier service, hand delivery or mail.  Facsimile
       submissions will not be accepted.  Proofs of claim will be
       deemed filed when actually received by the Claims and
       Noticing Agent.  If a creditor wishes to receive
       acknowledgment of receipt of its proof of claim, it must
       submit a copy of the proof of claim and a self-addressed,
       stamped envelope;

    -- all persons and entities who wish to assert claims against
       more than one Debtor must file a separate Proof of Claim
       Form for each Debtor.  This is to avoid confusion as well
       as facilitate the maintenance of separate Claim registers
       for each Debtor; and

    -- the creditor must identify on each Proof of Claim Form the
       particular Debtor against which its claim is asserted if
       the claim is against multiple Debtors.  This is to
       expedite the Debtors' review of proofs of claim in these
       cases.(Kmart Bankruptcy News, Issue No. 42; Bankruptcy
       Creditors' Service, Inc., 609/392-0900)

KSAT: Expects $17.9 Mil. Net Capital Deficiency at December 2002
KSAT Satellite Networks Inc. (TSX Venture - KSA) has determined
that it expects to have an unaudited shareholders' deficiency of
approximately US$17.9 million as at December 31, 2002.

During the past year, the growth of mobile phone users in China
has increased significantly, making it difficult for paging
operators to maintain their subscriber base. Accordingly, paging
operators have either cut back on capital expenditures or
reduced their existing paging infrastructure to match the
reduction in their subscriber base and the reduced operating

The Corporation's previous expectation that China's membership
in the World Trade Organization would create new business
opportunities for the Corporation did not yield the anticipated
opportunities and accordingly the expected increase in demand
for VSAT Satellite Communication equipment and related services
in the Chinese market did not materialize for the Corporation.

In addition, major state-owned telecommunications companies have
undergone a period of restructuring and consolidation, which has
had a negative impact on capital expenditures for the expansion
and upgrading of existing systems and on the sales the
Corporation was able to close in fiscal 2002.

The increase in the shareholder's deficiency as at December 31,
2002 is the result of the abovementioned changes and economic
pressures in the Corporation's area of focus, the
telecommunications and satellite industry in China in fiscal

These economic conditions and the difficult operating
environment for paging operators in China have led management of
the Corporation to recommend, and the board of directors of the
Corporation to approve, the proposed write down and creation of
provisions against certain assets of the Corporation, namely
inventory, trade receivables and capital assets totaling US$5.5
million as at December 31, 2002. The proposed write down and the
creation of provisions are reflected in the unaudited
shareholders' deficiency of US$ 17.9 million as at December 31,

The Corporation is maintaining its commitment to service their
customers of its One Way Receiver business, which have been
secured over the past two years. In addition the Corporation
continues to negotiate an extension of the repayment of its
shareholder loans and convertible debentures with two of its
shareholders. The outcome of this matter is still uncertain.

LERNOUT & HAUSPIE: Settles CFSB Dispute over Mendez Sale Fees
On Lernout & Hauspie Speech Products N.V. and Dictaphone Corp.
and its debtor-affiliates' behalf, Luc A. Despins, Esq., and
Matthew S. Barr, Esq., at Milbank, Tweed, Hadley & McCloy LLP,
in New York, and Gregory W. Werkheiser, Esq., at Morris Nichols
Arsht & Tunnell, in Wilmington, Delaware, signed a stipulation
settling a dispute over the allocation of the fees charged by
Credit Suisse First Boston as the Debtors' exclusive financial
advisor in connection with the sale of Mendez SA.

Notwithstanding the provisions of its Court-approved engagement
letter or any other agreement or arrangement, CSFB agreed to
accept a one-time payment of $2,875,000 in full and final
satisfaction of any obligation of any member of the Debtors to
CSFB other than:

        (a) the indemnity under the engagement letter between
            the parties, and

        (b) any payment owed to CSFB from the sale of the assets,
            securities or businesses of Mendez S.A.;

CSFB filed a Second Amended and Final Fee Application seeking
approval and allowance of the $2,875,000 payment.  The Debtors
agree that, subject to the Bankruptcy Court's allowance of the
CSFB Final Fee Application for $2,875,000, they would allocate
the CSFB payment among them as:

               Debtor                         Amount
               ------                         ------
               L&H NV                     $1,387,187.28
               L&H Holdings                  712,812.28
               Dictaphone                    775,000.00

If the Bankruptcy Court allows the CSFB Final Fee Application in
an amount other than $2,875,000, the Debtors will file a
subsequent notice allocating any allowed amount.

In addition to the compensation of $2,875,000, Dictaphone
planned to pay CSFB $750,000 in Dictaphone stock as set forth in
the Dictaphone plan of reorganization.  Dictaphone will
distribute the $750,000 in Dictaphone stock to L&H NV as part of
the Allocation. (L&H/Dictaphone Bankruptcy News, Issue No. 34;
Bankruptcy Creditors' Service, Inc., 609/392-0900)

LUBY'S: November Working Capital Deficit Balloons to $5.1 Mill.
Luby's Inc.'s sales decreased $7.0 million, from $95 million to
$88 million, or 7.3%, in the first quarter of fiscal 2003
compared to the first quarter of fiscal 2002.  Of the total
decline, $4.3 million was due to the closure of 22 restaurants
since August 31, 2001, and $4.6 million was due to a 5.1%
decrease in same-store sales.  These contributors to the total
decline were offset by the positive impact of two additional
days of sales of $1.9 million.

Net loss for the quarter ended November 21, 2002 was $3,101, as
compared to the net loss of $5,345 for the comparable quarter of

Cash decreased by $1.4 million from the end of the preceding
fiscal year to November 20, 2002, primarily due to capital
expenditures and operating cash flow needs.

Excluding the reclassification of the credit facility balance,
the Company had a working capital deficit of $5.1 million at
November 20, 2002, in comparison to a working capital deficit of
$1.1 million at August 28, 2002.  The increase in the deficit
was primarily attributable to a reduction in short-term

Capital expenditures for fiscal 2003 are expected to approximate
$15 million.  Management continues to focus on improving the
appearance, functionality, and sales at existing restaurants.
These efforts also include, where feasible, remodeling certain
locations to other dining concepts.  During the current quarter,
the Company remodeled and reopened a previously closed location
as its first steak buffet.  The new dining themes for the other
three planned remodels in fiscal 2003 are still under

At August 28, 2002, the Company had a credit facility balance of
$118.4 million with a syndicate of four banks.  In accordance
with provisions of the credit facility, the Company paid the
outstanding balance down by $4.9 million from proceeds received
from the sale of real and personal property.  As a result, the
balance was lowered to $113.5 million at the end of the first
quarter of fiscal 2003.  The interest rate was prime plus 1.5%
at both November 20, 2002, and August 28, 2002.

Under the agreement terms, the Company was required to meet
certain indicated EBITDA levels.  EBITDA is defined in the
credit agreement as earnings before interest, taxes,
depreciation, amortization, and noncash executive compensation.
The annual EBITDA requirement was met for fiscal year 2002.
However, the Company fell short of its fourth quarter EBITDA
requirement.  Effective November 25, 2002, management obtained a
waiver for the fourth-quarter and an amendment to the debt
agreement.  The amendment extended the debt's maturity to
October 31, 2004, and increased the applicable interest rate
from prime plus 1.5% to prime plus 2.5%.  Additionally, the
financial covenant was changed from quarterly and annual EBITDA
measurements to one that assesses liquidity and future debt
service.  Management believes the new covenant is achievable and
considers it to be more appropriate for the collateralized
credit facility.

In addition, the Company executed a commitment letter with
another financial entity for an $80 million loan.  Its purpose
is to replace that amount of debt in the existing credit
facility.  Thus, the amendment discussed above requires that the
entire proceeds from the other financial entity be used to pay
down the credit facility.  In the event the Company is unable to
make the $80 million payment as currently planned, the amended
loan would be in default.  The existing lenders would then have
the right to exercise any and all remedies, including the right
to demand immediate repayment of the entire outstanding balance
or the right to pursue foreclosure on the assets pledged as

As of November 20, 2002, $241.6 million of the Company's total
book value, or 72.0% of its total assets, including the
Company's owned real estate, improvements, equipment, and
fixtures, was pledged as collateral under the credit facility.

The nonbinding commitment letter with the new lender is subject
to conditions the Company must satisfy before the actual
financing can occur.  Management is currently working toward
this goal and has high confidence that the transaction will be
completed and the financing closed by January 31, 2003. The
Company also could pursue other options if its current
refinancing plans cannot be finalized.  Those options include
financing through high-yield debt at higher than commercial
rates or conducting additional equity security sales through
public or private offerings.  Dilution to existing shareholders
would result in the case of equity security sales.

Assuming the $80 million is financed with a third party, the
amended facility also mentions two principal payments.  The
first is a target of $15 million that is also to be paid by
January 31, 2003, from either proceeds from the sale of property
or operating cash flow.  A total paydown of less than $15
million would result in a 1% increase in the applicable interest
rate from prime plus 2.5% to prime plus 3.5%.  The second
payment, from property sales or operating cash flow, is an
additional $10 million by September 1, 2003.  Again, total
payments of less than $10 million would result in another 1%
increase in the applicable interest rate.

LUMENON INNOVATIVE: LILT Unit Granted CCAA Protection in Canada
Lumenon Innovative Lightwave Technology, Inc. (Nasdaq:LUMM),
announced that its wholly owned Canadian operating subsidiary
LILT Canada Inc. has filed a Petition under the Canadian
Companies' Creditors Arrangement Act with the Superior Court of
Quebec and obtained an order granting it certain relief,
including a stay of proceedings and protection from creditors.
All of Lumenon's operations and activities are performed through

Pursuant to the order, all payments in respect to any debt or
obligations of LILT existing on or before January 8, 2003 are
stayed and suspended pending development by LILT of a
restructuring plan. The order provides for an initial stay
period of 30 days, which could be extended by the court. During
this period, LILT will continue its current operations and to
develop its product(s). Richter & Associes Inc. has been
appointed by the court to act as monitor pursuant to the
provisions of the CCAA.

LILT's petition under the CCAA will constitute a default under
the terms of certain agreements to which Lumenon is a party,
including under the terms of Lumenon's amended and restated
convertible notes. If Lumenon fails to restructure its
obligations under the notes or if the noteholders exercise the
default remedies that they are entitled to exercise upon a
default under the notes, Lumenon will be required to seek
protection under Chapter 11 of the U.S. Bankruptcy Code. Lumenon
is currently in discussions with the noteholders to explore the
options related to restructuring its obligations under the

Commenting on the petition, Gary Moskovitz, Lumenon's President
and Chief Executive Officer, stated, "The deterioration and the
continuing uncertainty in the telecommunications sector has made
it extremely difficult to obtain adequate financing to allow
Lumenon to continue its operations. We believe that this step is
in the best interest of all our stakeholders."

Lumenon Innovative Lightwave Technology, Inc., a photonic
materials science and process technology company, designs,
develops and builds optical components and integrated optical
devices in the form of packaged compact hybrid glass and polymer
circuits on silicon chips. These photonic devices, based upon
Lumenon's proprietary materials and patented PHASIC design
process and manufacturing methodology, offer system
manufacturers greater functionality in smaller packages and at
lower cost than incumbent discrete technologies. Lumenon is a
trademark of Lumenon Innovative Lightwave Technology, Inc.

For more information about Lumenon Innovative Lightwave
Technology, Inc., visit the Company's Web site at

LYONDELL: Venezuelian Oil Situation Spurs Negative Implications
Standard & Poor's Ratings Services placed its ratings, including
its 'BB' corporate credit rating, on Lyondell Chemical Co. on
CreditWatch with negative implications based on concerns about
the reliability of crude oil deliveries from Venezuela to one of
its affiliates.

"The CreditWatch placement reflects elevated concerns related to
58.75%-owned LYONDELL-CITGO Refining LP (LCR), and the potential
that recent operating disruptions caused by the lack of crude
oil deliveries from Venezuela, if not resolved soon, could
negatively affect credit quality at Lyondell", said Standard &
Poor's credit analyst Kyle Loughlin. LCR reportedly has reduced
its production by almost half in response to a general strike
against the Chavez administration and related disruptions
at the state-owned oil company, PDVSA.

Mr. Loughlin stated that these developments and the lack of
clear resolution that will enable LCR to resume normalized
production levels, raise concerns that previously anticipated
cash distributions from LCR to Lyondell are likely to fall well
below expectations. "The CreditWatch placement will allow time
to evaluate additional risk factors, such as Lyondell's ability
to amend restrictive financial covenants associated with bank
facilities that may be breached partly as a result of LCR's
operating shortfalls, and the potential that LCR's parents,
including Lyondell, could consider supporting LCR's business
operations in a form that absorbs valued credit capacity at

Concurrently, Standard & Poor's said that it has affirmed its
'BB' corporate credit rating on Equistar Chemical LP to reflect
Standard & Poor's view that a modest Lyondell downgrade would
not necessarily result in credit deterioration at Equistar.
Standard & Poor's believes that Millennium Chemicals Inc.'s
ownership stake in Equistar and rights under the partnership
agreement provide a measure of protection to Equistar creditors.

Lyondell Chemical Co.'s 10.875% bonds due 2009 (LYO09USR1),
DebtTraders say, are trading between 85 and 87. See
real-time bond pricing.

MAGELLAN HEALTH: Names Rene Lerer Chief Operating Officer
Magellan Health Services, Inc., (OCBB:MGLH), announced that Rene
Lerer, M.D., has been named chief operating officer.

Lerer brings to Magellan more than 20 years of health care
experience, including particular skills in all aspects of
operations, as well as expertise in product development and
health care carve-out management.

Lerer has held positions as chief operating officer with
Prudential Healthcare and The Travelers Health Network, as well
as senior vice president of operations, pharmacy and disease
management with Value Health, Inc., a specialty managed care
organization that comprised the largest managed behavioral
health care organization at the time.

Lerer most recently served as president of Internet Healthcare
Group, an organization he co-founded with Steven Shulman. He
holds a doctor of medicine degree from the State University of
New York at Buffalo and is board certified in internal medicine.

Steven J. Shulman, Magellan's CEO, stated, "Having worked
closely with Rene for over a decade in the health care industry,
I have supreme confidence in his expertise, his judgment and his
ability to build quickly on the progress Magellan has made over
the past year in our overall level of service and operational
efficiency. Magellan is the leading behavioral health managed
care company, and with our talented and dedicated professionals
I am confident we can be a world class company as well."

Lerer stated, "I am looking forward to contributing my full
energies and operational experience to completing the work
designed to improve Magellan's service and efficiency that's
already underway, and to aggressively pursuing new opportunities
for raising Magellan's performance even further."

Lerer succeeds Jay J. Levin, who has agreed to continue in his
capacity as president for a transitional period, supporting the
company in its current efforts.

Headquartered in Columbia, Md., Magellan Health Services, Inc.
(OCBB: MGLH), is the country's leading behavioral managed care
organization, with approximately 68 million covered lives. Its
customers include health plans, government agencies, unions, and

                           *   *   *

As previously reported, Magellan Health Services, Inc.,
(OCBB:MGLH) entered into an amendment to its Credit Agreement
that provides for, among other things, extensions of waivers of
any default of its financial covenants through January 15, 2003.

The amendment is consistent with the Company's previously stated
intention, which it reiterated, to seek appropriate waivers
under its Credit Agreement as it proceeds with its efforts to
reduce its debt and improve its capital structure.

METALS USA: Wants Court to Approve National Steel Stipulation
Metals USA, Inc., and its debtor-affiliates ask the Court to
approve a stipulation with National Steel Corporation to reduce
National Steel's general unsecured claim from $5,842,942.90 to

Johnathan C. Bolton, Esq., at Fulbright & Jaworski LLP, in
Houston, Texas, informs the Court that National Steel filed
these general unsecured claims for steel sold to the Debtors:

        Claim No.           Claim Amount
        ---------          -------------
           3594               $29,503.65
           3595                22,566.97
           3596               124,008.72
           3597             1,240.813.63
           3598                68,766.43
           3599               624,885.04
           3600             3,730,398.46
          Total            $5,840,942.90

After carefully reviewing their books and records, the parties
have agreed that the proper aggregate amount for National
Steel's general unsecured claim against the Debtors is less than
the filed claim amount.

The Debtors believe that they have a claim against National
Steel in its own Chapter 11 case for $173,000.  National Steel
intends to set off its claims against the Debtors against the
Debtors' Claim.  The Debtors have agreed to allow the setoff of
its claim as part of the resolution of the amount of National
Steel's claim in these Chapter 11 cases.

The salient terms of the stipulation are:

     A. National Steel will have an Allowed Class 4 General
        Unsecured Claims against the Debtors amounting to

     B. The allowed claim is, and will remain, a valid,
        undisputed, liquidated, non-contingent, general unsecured
        claim against the Debtors and there are no legal and
        equitable defenses, counterclaims or offsets that have
        been or may be asserted by or on the Debtors' behalf to
        reduce the amount of the allowed claim or affect its
        validity or enforceability, and the allowed claim is not
        and will not be subject to any claim or right of setoff,
        reduction, recoupment, impairment, avoidance,
        disallowance or subordination, including any remaining

     C. No portion of the allowed claim is a claim for
        reclamation and the allowed claim does not arise under an
        executory contract;

     D. There are no preference or other avoidance actions
        pending or threatened against the allowed claim;

     E. The $430,942.90 amount of the filed claim, which exceeds
        the allowed is disallowed;

     F. The Debtors agree to waive their claims against National
        Steel for steel ordered prior to National Steel's Chapter
        11 petition, including the $173,000 Claim, except Metals
        USA Carbon Flat Rolled Inc.'s timely-filed proof of claim
        against National Steel for $137,080.29; provided,
        however, that the Debtors do not waive any claims against
        National Steel for any steel delivered to the Debtors
        during National Steel's bankruptcy case, including any
        claims related to the quality of the material provided;

     G. The allowed claim may be assigned by National Steel and
        the Debtors will have no right to set off the remaining
        claim against the allowed claim. (Metals USA Bankruptcy
        News, Issue No. 25; Bankruptcy Creditors' Service, Inc.,

NAT'L CENTURY: Obtains 60-Day Extension to Lease Decision Period
National Century Financial Enterprises, Inc., together with its
debtor-affiliates are party to a number of unexpired non-
residential real property leases.

Charles M. Oellermann, Esq., at Jones, Day, Reavis & Pogue, in
Columbus, Ohio, notes that Section 365 of the Bankruptcy Codes
provides that:

     "If the trustee does not assume or reject an unexpired lease
     of nonresidential real property under which the debtor is
     the lessee within 60 days after the date of the order for
     relief, or within such additional time as the court, for
     cause, within the 60-day period, fixes, then such lease is
     deemed rejected, and the trustee shall immediately surrender
     the non-residential property to the lessor."

As to the Debtors' case, the 60-day period expires on January
17, 2003.  Consequently, unless the time period to assume or
reject non-residential real property leases is extended, the
Debtors will be required to make decisions concerning the Leases
by that date.  However, Mr. Oellermann relates that the Debtors
have focused their efforts principally on completing the smooth
transition of operations in Chapter 11.

In light of the press of business and litigation matters
incident to the commencement of these cases, the Debtors have
not been able to:

     (a) identify and evaluate the Leases thoroughly,

     (b) determine which of the Leases will contribute to their
         operations during these Chapter 11 cases or,

     (c) solicit the views of the Creditors' Committee, their
         prepetition bank lenders and bondholders, and other
         constituencies regarding the appropriate treatment of
         each Lease.

"The Debtors already have made progress in assessing their needs
for leased properties and they intend to reject certain of these
Leases," Mr. Oellermann reports.  However, the Debtors believe
it would be imprudent for them to elect whether to assume,
assume and assign, or reject each of the Leases within the 60-
day period specified in Section 365(d)(4).

Without the extension of the 60-day period, Mr. Oellermann says,
the Debtors are at risk of prematurely and improvidently
assuming Leases that they may later discover to be burdensome;
or prematurely and improvidently rejecting Leases that they may
later discover are critical to their operations during these
Chapter 11 cases.

Accordingly, the Debtors sought and obtained a Court order
extending the lease decision deadline to March 18, 2003.
(National Century Bankruptcy News, Issue No. 5; Bankruptcy
Creditors' Service, Inc., 609/392-0900)

NEXTEL COMMS: President Airs Greatly Improved Finances in 2002
In a keynote speech at the Salomon Smith Barney
Telecommunications and Media conference in La Quinta,
California, Nextel Communications Inc. (NASDAQ:NXTL) President
and CEO Tim Donahue told investors that 2002 was a breakthrough
year for the wireless company and he looks forward to another
stellar year in 2003 as well.

"By all measures, 2002 was an extremely successful year for
Nextel," according to Donahue. "Not only did we accomplish our
goal to gain more than 1.9 million net new subscribers, but we
expect to generate at least $3.1 billion in operating cash flow
and also reduce capital expenditures by more than 20 percent
over 2001, to under $1.9 billion. In addition, during 2002 we
significantly improved our balance sheet by reducing debt, and
achieved positive net income, which are record achievements for

The details of the 2002 year-end financial results will be
announced during Nextel's 4th Quarter earnings call that will be
held toward the end of February. Sales in December were the
strongest in Nextel's history, driven in part by robust sales
across all channels, particularly lower-cost distribution

"Even in this challenging climate, we continue to see great
opportunity for growth in the FORTUNE 1000, small and mid-sized
businesses, government, other vertical industries and the high-
end individual decision-maker," said Donahue. "All our
indications are pointing to achieving positive free cash flow in
2003. We'll do this by maintaining our focus of attracting and
keeping the most valuable customers in the wireless industry
while at the same time streamlining our cost structure. We'll
also continue to lead the industry with rational pricing of
wireless service, price plan packages and equipment subsidies.
Because we deliver what no other company can with our nationwide
packet data network and Nextel Direct Connect(R), the digital
long-range walkie-talkie feature, we're able to price our
service to deliver greater value, while giving our customers an
obvious return on their investment through greater

Nextel Communications, a Fortune 300 company based in Reston,
Virginia, is a leading provider of fully integrated wireless
communications services and has built the largest guaranteed
all-digital wireless network in the country covering thousands
of communities across the United States. Nextel and Nextel
Partners, Inc., currently serve 197 of the top 200 U.S. markets.

Through recent market launches, Nextel and Nextel Partners
service is available today in areas of the U.S. where
approximately 240 million people live or work.

DebtTraders reports that Nextel Communications Inc.'s 12.000%
bonds due 2008 (NXTL08USR2) are trading between 50 and 52. See
for real-time bond pricing.

                          *   *   *

As reported in the November 18, 2002, edition of the Troubled
Company Reporter, Fitch Ratings has revised the Rating Outlook
on Nextel Communications Inc., to Stable from Negative. The
Stable Rating Outlook applies to Nextel's senior unsecured note
rating of 'B+', the senior secured bank facility of 'BB' and the
preferred stock rating of 'B-'.

The Stable Rating Outlook reflects Fitch's view that favorable
financial trends will continue over Nextel's current rating
horizon based on the positive momentum created from the
accelerated improvement in operating performance, significant
reduction in debt and associated obligations and strong cost
containment despite a somewhat unfavorable climate within the
wireless industry and weak economic environment. Fitch believes
Nextel's operating performance, improvement to its capital
structure and remaining liquidity offsets existing credit risk
leaving a margin of safety consistent with a stable 'B+' rated
credit. Expectations are for Nextel to further strengthen credit
protection measures in 2003 to 4.0 times debt-to-(LTM) EBITDA or
less. The improving cash flows should lead to at least a free
cash flow neutral position for 2003. Nextel may also benefit
from further potential debt reduction.

OWENS: Asks to Stretch Summons Deadline Until March 31, 2003
Pursuant to Section 546 of the Bankruptcy Code, in the absence
of the appointment of a trustee, adversary actions may not be
commenced more than two years after the Petition Date.  Norman
L. Pernick, Esq., at Saul Ewing LLP, in Wilmington, Delaware,
reminds the Court that this two-year period expired on
October 5, 2002.

Mr. Pernick recounts that in anticipation of the expiration of
the two-year limitations period for bringing adversary actions,
Owens Corning and its debtor-affiliates' representatives
conducted an examination of possible actions and, on July 31,
2002, met with representatives of the Creditors and Asbestos
Committees to discuss and to decide what adversary actions
should be brought and by whom.

Prior to September 20, 2002, Mr. Pernick relates, official
committees were generally believed to have the power to bring
adversary actions on behalf of the estate with bankruptcy court

Two judicial determinations, however, changed the circumstances
regarding the filing of adversary actions:

     (1) In Official Committee of Asbestos Personal Injury
         Claimants v. Sealed Air Corp. (In re W.R. Grace & Co.),
         2002 Bankr. LEXIS 766 (Bankr. D. Del., July 29, 2002)
         (Wolin, U.S.D.J.), Judge Wolin provided guidelines for
         determining the insolvency of an entity facing asbestos-
         related tort liability.  Given the latency periods
         inherent in the continuing development of asbestos-
         related injuries, the Grace opinion makes clear that
         entities like Owens Corning and its affiliate,
         Fibreboard Corporation, both of which are subject to
         asbestos claims, may have been insolvent far earlier
         than previously understood.

         The Grace decision had the effect of increasing the
         number of transactions to be analyzed as potential
         fraudulent transfers because it expanded the period of
         time during which those Debtors with asbestos liability
         may have been insolvent.  After the Grace decision,
         every transaction made by Owens Corning or Fibreboard
         Corporation, within the appropriate statute of
         limitations, was re-analyzed to determine whether the
         transaction was subject to avoidance under the
         Bankruptcy Code and applicable state law; and

     (2) On September 20, 2002, the United States Court of
         Appeals for the Third Circuit issued its opinion in
         Official Committee of Unsecured Creditors of Cybergenics
         Corp. v. Chinery, 2002 U.S. App. LEXIS 19731 (3d Cir.,
         Sept. 20, 2002), vacated, reh'g en banc granted, 310
         F.3d 785 (3d Cir. 2002).  Cybergenics precludes a
         creditor's committee from obtaining the court's
         permission to file adversary actions under 11 U.S.C.
         544(b), as had previously been the accepted practice.

In light of the Grace and Cybergenics decisions and the demands
from the Committees, the Court directed the Debtors to obtain
tolling agreements from certain putative defendants or to bring
the adversary actions.

Between September 30 and October 4, 2002, the Debtors commenced
18 adversary actions.

According to Mr. Pernick, the Debtors also negotiated and filed
167 tolling agreements with putative defendants, thus preserving
causes of action against them beyond the otherwise applicable
limitations period.

On October 16, 2002, the Debtors filed a "Motion for Order
Staying Adversary Actions Pending Introduction and Confirmation
of Plan of Reorganization.  The Motion to Stay is currently
scheduled for hearing on January 27, 2003.  Pending a hearing on
the Motion to Stay, the Court has, with limited exception,
extended the time for defendants to answer, move or otherwise
respond to the Adversary Actions until March 3, 2002.

The Adversary Actions name a total of 165 Defendants.  Between
October 5, 2002 and December 23, 2002, the Debtors have served
146 of the 165 Defendants.  Despite their best efforts, the
Debtors have so far been unable to serve 19 of the total 165
Defendants.  These 19 remaining unserved Defendants relate to
these Adversary Actions:

     (1) Owens Corning v. Sanford C. Bernstein & Co. LLC, et al.,
         Adv. Proc. No. 02-5820;

     (2) Owens Corning v. John D. Roach, et al., Adv. Proc. No.
         02-5826; and

     (3) Owens Corning v. Credit Suisse First Boston, et al.,
         Adv. Proc. No. 02-5829.

Mr. Pernick explains that the Debtors have made a good faith
effort to serve these 19 Defendants.  The Debtors recorded their
last known addresses via a variety of means, including the
Internet, and sent copies of the Complaint and Summons to each
of the 19 Defendants via first class mail and certified mail.
Also, in connection with Owens Corning v. Sanford C. Bernstein &
Co. LLC, et al., Adv. Proc. No. 02-5820 and Owens Corning v.
John D. Roach, et al., Adv. Proc. No. 02-5826, both of which are
putative class actions, the Debtors published public notices --
Notice of Class Actions -- in The New York Times, from October
3, 2002, through and including October 5, 2002, and in The Wall
Street Journal, from October 3, 2002 through and including
October 4, 2002.

The Debtors are continuing their efforts to locate and to serve
these 19 remaining unserved Defendants.

According to Bankruptcy Rule 7004(a), Rule 4(m) of the Federal
Rules of Civil Procedure applies in adversary proceedings.  Rule
4(m) provides that if service of the summons and complaint are
not made within 120 days of filing the complaint, the court may
dismiss the complaint.  Thus, the last day for service --
employing the earliest filing date of September 30, 2002 -- is
January 28, 2003.

By this Motion, Debtors ask the Court to extend the time to
serve the Summons and Complaints on the Defendants in the
Adversary Actions for 62 days after January 28, 2003 or until
March 31, 2003.

Mr. Pernick argues that good cause is exists to extend the
Debtors' time to serve process.  Mr. Pernick points out that the
Debtors have acted diligently.  There is no harm to Defendants,
as the Debtors are only seeking a brief extension, all
have notice of the Adversary Actions, and there is a pending
Motion to Stay the Adversary Actions.

Mr. Pernick relates that the Debtors have diligently attempted
to effectuate service in the Adversary Actions.  It was
difficult since many of Debtors' records did not contain the
proper legal names or addresses of the Defendants.  Due to the
amount of time needed to produce the first mailing, the number
of return certified mail receipts received, the number of
returned envelopes, and the need to verify assertions in
correspondence from those purporting to be wrongfully served,
the Debtors' counsel has been unable to determine fully,
properly and effectively if service has been effected on certain
of the Defendants.

Currently, Mr. Pernick says, they are attempting to serve any
Defendant whose Summons and Complaint were returned unserved.

"If the Court does not extend the Debtors' time to serve
process, a Defendant could move to dismiss the claim for failure
to serve process timely, and the Debtors may be time barred from
re-filing the complaint," Mr. Pernick notes.

Mr. Pernick contends that the Debtors' request enables the
Debtors to achieve the goal of maximizing the estates' assets.
Furthermore, Mr. Pernick explains, the Debtors made this request
prospectively to prevent any needless and costly motions to
dismiss for failure to serve process timely. (Owens Corning
Bankruptcy News, Issue No. 43; Bankruptcy Creditors' Service,
Inc., 609/392-0900)

PACIFICARE HEALTH: Discloses Financial Outlook for 2003
PacifiCare Health Systems Inc. (Nasdaq:PHSY), provided its
financial outlook for 2003. The company expects earnings for the
full year to range from $4.25 to $4.35 per diluted share.

This guidance reflects management's expectations for net income
growth of approximately 15% from 2002 levels as the company
benefits from strong commercial premium rate increases, an
improved commercial medical loss ratio, and the continued strong
performance of its specialty businesses.

The 2003 EPS guidance also reflects the negative impact of an
estimated 5% annual rise in weighted average shares outstanding,
to approximately 37.7 million shares.

Howard G. Phanstiel, PacifiCare's president and chief executive
officer, said: "We are pleased to announce our expectations for
continued solid earnings growth in 2003, which follows on the
heels of a strong year in 2002 that surpassed both internal and
external earnings expectations. The turnaround in the company's
performance challenged us to revise our business model, to alter
our business mix, and to complete a major recapitalization

"We have responded to this challenge by reinvigorating our
commercial business while reducing our reliance on the
Medicare + Choice product. This has been achieved by introducing
many new products, by enhancing our marketing and advertising,
and by significantly growing our specialty businesses beyond
PacifiCare's own membership. While there is still much left to
accomplish in 2003 and beyond, the progress we made in 2002 gave
us considerable momentum as we enter the new year."

Excluding the loss of the 185,000 member CalPERS account,
PacifiCare's commercial membership is estimated to rise 4% from
2002 to the end of 2003. Medicare + Choice membership is
expected to decline by 11%, due primarily to benefit design
changes and the company's exit from five counties affecting
37,000 members.

However, the company's senior segment is expected to benefit
from a more than five-fold increase in Medicare Supplement
membership to about 90,000 members by year-end.

Operating revenue in 2003 is estimated to decline 1 to 2%. This
reflects expected membership declines of about 4% in the
company's commercial business, and about 1% in the company's
senior business. Although the CalPERS account is the main reason
for the drop in the company's commercial HMO business, this
membership will be partly offset by a gain of approximately
120,000 members from new or expanded accounts, and the expected
growth in the PPO business which was launched in 2002.

Expectations for growth in specialty product revenue are due
largely to recent efforts by Prescription Solutions, the
company's pharmacy benefit management subsidiary, and PacifiCare
Behavioral Health, to add new business that is not affiliated
with PacifiCare's own health plans. This will result in an
increase in other income of more than 50%.

Another year of strong commercial premium rate increases will
offset the revenue impact of lower membership. In the commercial
segment, per member per month premium yield increases are
expected to average in the mid- to high-teens after benefit
buydowns as a result of product and business mix changes. The
commercial medical loss ratio (MLR) is expected to improve by at
least 200 basis points to about 85%, consistent with the
company's previously announced turnaround goal.

The senior MLR, on the other hand, is expected to rise
approximately 200 basis points to about 89%, as government
premium increases continue to lag behind the higher cost of
treating the Medicare + Choice population and the company
pursues its strategy of optimizing gross profit with this

Selling, general and administrative (SG&A) expense, currently
running near 12.5% of revenue, is expected to again range
between 12.5 and 13% of revenue in 2003. The company continues
to invest in new technology and new product launches to expand
its commercial and senior businesses. This year's SG&A expense
will also reflect a significant increase in broker commissions
as a result of a greater emphasis on small group and individual
health insurance products.

Interest income is projected to grow by about 10%, primarily
because the company does not anticipate a recurrence of last
year's write-down of impaired investments. Interest expense is
estimated to be flat to down slightly from the prior year.

Earnings before interest, taxes, depreciation and amortization
(EBITDA) is forecast to range between $400 million and $425
million in 2003, while free cash flow, defined as net income
plus depreciation and amortization, minus capital expenditures,
is expected to total about $175 million.

Gregory W. Scott, executive vice president and chief financial
officer, commented on the outlook for the first quarter of 2003:
"Although we expect net income in the first quarter to be up
from the same period in the prior year, EPS is anticipated to be
flat with that quarter, in the range of $0.85 to $0.95. This is
primarily attributable to a greater than 8% expansion of our
average shares outstanding since last year's first quarter,
through the addition of a stock match to our 401(k) plan, the
introduction of an employee stock purchase plan, option grants,
the sale of shares under an equity commitment arrangement and
debt-for-equity swaps which were completed in 2002.

"Profits in the first quarter will also be dampened by costs
associated with administering claims for members who left at the
end of 2002, which should abate by the second quarter."

PacifiCare Health Systems is one of the nation's largest
consumer health organizations with approximately $11 billion in
annual revenues. Primary operations include managed care
products for employer groups and Medicare beneficiaries in eight
Western states and Guam serving about 3 million members.

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

                       *   *   *

As reported in Troubled Company Reporter's December 4, 2002
edition, Standard & Poor's assigned its 'B' rating to PacifiCare
Health Systems Inc.'s $125 million 3% convertible subordinated
debentures, which are due in 2032 and are being issued under SEC
Rule 144A with registration rights.

Standard & Poor's also said that it revised its outlook on
PacifiCare to stable from negative.

"The rating is based on PacifiCare's good business position as a
regional managed care organization and improved earnings
performance," said Standard & Poor's credit analyst Phillip C.
Tsang. "Offsetting these strengths are PacifiCare's marginal
capitalization and high percentage of goodwill in its capital."
PacifiCare expects to use the net proceeds from the issue to
permanently repay indebtedness under its senior credit facility,
with the remainder for general corporate purposes.

PANACO: AMEX to Delist Shares for Violating Listing Requirements
PANACO, Inc. (Amex: PNO), an oil and gas exploration and
production company, received a notification from the American
Stock Exchange regarding its intention to proceed with the
filing of an application with the Securities and Exchange
Commission to strike the Company's common stock from listing and
registration on the Amex. The Amex notification states that the
Company is not currently in compliance with Amex listing
standards related to the Company's SEC filings, recent results
of operations and financial condition. Although the Company may
appeal this decision, such appeal would be based on the merits
of a plan prepared by the Company showing how it might regain
compliance with the listing standards cited by the Amex staff.
Consistent with its decision not to submit such a plan in
response to an Amex notification of November 29, 2002, the
Company's Board of Directors has similarly concluded not to
appeal the Amex determination to seek delisting given the
Company's pending Chapter 11 proceedings, its ongoing efforts to
develop a plan of reorganization and its current financial

PANACO, Inc. is an independent oil and gas exploration and
production Company focused primarily on the Gulf of Mexico and
the Gulf Coast Region. The Company acquires producing properties
with a view toward further exploitation and development,
capitalizing on state-of-the-art 3-D seismic and advanced
directional drilling technology to recover reserves that were
bypassed or previously overlooked. Emphasis is also placed on
pipeline and other infrastructure to provide transportation,
processing and tieback services to neighboring operators.
PANACO's strategy is to systematically grow reserves,
production, cash flow and earnings through acquisitions and
mergers, exploitation and development of acquired properties,
marketing of existing infrastructure, and a selective
exploration program.

PHOTOWORKS: Says Existing Cash Sufficient to Fund Near-Term Ops.
PhotoWorks, Inc., is a photo services company dedicated to
providing its customers with innovative ways to enjoy and use
their photos. In February 2000, the Company name was changed
from Seattle FilmWorks to PhotoWorks to reflect the Company's
corporate mission to be the leading mail-delivered digital photo
printing service. The Company offers an array of complementary
services and products primarily under the brand names
PhotoWorks(R) and Seattle FilmWorks(R).

Net revenues decreased 25.7% to $42,093,000 in fiscal 2002
compared to $56,690,000 in fiscal 2001. Net revenues decreased
30.9% to $56,690,000 in fiscal 2001 from $82,061,000 in fiscal
2000. The decreases in net revenues for fiscal years 2002 and
2001 were primarily due to declines in film-based processing
volumes which management attributes to increased competition,
primarily mass merchants, and declines in the effectiveness of
its customer acquisition programs. During fiscal 2002, net
revenues from digital-based processing increased to
approximately 3% of total net revenues compared to approximately
1.5% in fiscal year 2001. The Company's marketing expenditures
in fiscal 2002 and 2001 declined significantly as compared to
fiscal 2000, which contributed to the decline in processing
volumes. In addition, the photofinishing industry is
experiencing lower sales, which the Company believes may be due
to general economic conditions and changes in the photofinishing
industry in general. Net revenues are expected to decline
further in fiscal year 2003. Net revenues from ancillary
businesses declined approximately $600,000 in fiscal 2002 as
compared to fiscal 2001. In fiscal 2001, net revenues from
ancillary businesses declined approximately $2,300,000 as
compared to fiscal 2000. The decline in fiscal 2002 was
primarily due to lower sales of the Company's reloadable camera.
During fiscal 2002, the Company exited this business due to
issues related to its camera design. The decline in net revenues
from ancillary businesses in fiscal 2001 was primarily due to
declines in sales of wholesale film, which the Company phased
out in September 2000.

Net income for fiscal 2002 was $3,581,000, compared to a net
loss for fiscal 2001 of $12,122,000 and net loss of $34,794,000
for fiscal 2000. Net income for fiscal 2002 was primarily due to
income tax benefits of $5,673,000 as a result of the "Job
Creation and Worker Assistance Act" enacted by Congress in March
2002. The bill provided for an economic stimulus package of
temporary business tax incentives. The Company benefited from a
business tax incentive contained in the bill, which allows a
business to extend the net operating loss carry-back period to
five years (previously two years) for net operating losses
arising in taxable years ending in 2001 and 2002. In fiscal
2002, the Company had lower net revenues as compared to fiscal
2001, which were partially offset by lower operating expenses.
The net loss for fiscal 2001 as compared to the net loss for
fiscal 2000 was lower primarily due to a substantial decrease in
operating expenses, primarily marketing expenses. Operating
results will fluctuate in the future due to a number of factors
including lower sales, the level and nature of marketing
activities, price increases by suppliers, introductions of new
products, research and development requirements, actions by
competitors, economic conditions, and conditions in the online
and direct-to-consumer market and the digital imaging and
photofinishing industry in general.

As of December 13, 2002, the Company's principal sources of
liquidity included approximately $2,167,000 in cash and cash
equivalents. In addition, in September 2002 the Company made
certain prepaid expenditures of approximately $3,500,000,
primarily for prepayment of postage amounts, which will be
utilized in fiscal 2003.  The Company currently anticipates that
existing cash and cash equivalents, the $1,808,000 tax refund
and projected future cash flows from operations will be
sufficient to fund its operations, including any capital
expenditures, and to service its indebtedness through at least
September 30, 2003. However, if the Company does not generate
sufficient cash from operations to satisfy its ongoing expenses,
the Company may be required to seek external sources of
financing or refinance its obligations. Possible sources of
financing include the sale of equity securities or bank
borrowings. There can be no assurance that the Company will be
able to obtain adequate financing in the future.

QWEST: S&P Raises Ratings on Two Related Transactions to CCC+
Standard & Poor's Ratings Services raised its ratings on
PreferredPLUS Trust Series QWS-1 and PreferredPLUS Trust Series
QWS-2, and removed them from CreditWatch with negative
implications, where they were placed on November 25, 2002.

The PreferredPLUS trusts are swap-independent, synthetic
transactions that are weak-linked to the rating of the
underlying collateral, Qwest Capital Funding Inc.'s senior
unsecured 7.75% notes due February 15, 2031. Qwest Capital
Funding Inc. is a wholly owned subsidiary of Qwest
Communications International Inc.

On December 26, 2002, Standard & Poor's assigned its 'CCC+'
rating to Qwest Capital Funding Inc.'s remaining senior
unsecured debt that was not tendered in connection with Qwest
Communications International Inc.'s recent exchange offer
concerning various debt of Qwest Capital Funding Inc.

The trustee for the PreferredPLUS trusts advised Standard &
Poor's that the trusts did not participate in the exchange
offer, as they are not characterized as qualified institutional


               PreferredPLUS Trust Series QWS-1
             $40 million trust certs series QWS-1

         Class            To             From
         Certificates     CCC+           C/Watch Neg

               PreferredPLUS Trust Series QWS-2
            $38.75 million trust certs series QWS-2

         Class            To            From
         Certificates     CCC+          C/Watch Neg

Qwest Capital Funding's 7.000% bonds due 2009 (Q09USR1),
DebtTraders reports, are trading between 63 and 65. See
real-time bond pricing.

SASKATCHEWAN WHEAT: Nonfinancial Default Spurs S&P's Ratings Cut
Standard & Poor's Ratings Services lowered its long-term
corporate credit and senior secured debt ratings on Saskatchewan
Wheat Pool to 'CCC-' from 'B+'.

At the same time, the ratings were removed from CreditWatch,
where they were placed September 17, 2002. The outlook is

The ratings downgrade reflects Standard & Poor's opinion that
even though the company is not in violation of its newly
renegotiated financial covenants, SWP's banks have notified the
company that it is not in compliance with certain nonfinancial
covenants of existing credit agreements. This has been
challenged by SWP, with the banks having agreed to examine the
company's financial condition on a daily basis up until the
completion of the restructuring plan, due Jan. 31, 2003.

"The ratings also take into account the impact of a severe
drought on financial results, and a liquidity position that is
limited to SWP's existing credit facilities (the company had
C$95 million in bank line availability at year-end July 31,
2002), given that the company had no cash on hand as at fiscal
year-end  and asset disposals were, for the most part,
complete," said Standard & Poor's credit analyst Don Povilaitis.

Credit protection measures remain extremely weak, with full-year
fiscal 2002 adjusted EBITDA interest coverage at 1.1x, declining
from 1.7x in fiscal 2001, while EBIT interest coverage weakened
to 0.1x in fiscal 2002 from 0.8x in 2001. Fiscal 2002 year-end
debt to EBITDA grew to 7.6x. The company posted a fiscal 2002
net loss of C$92.2 million, versus a net loss of C$44.1 million
the previous year, while in the latest quarter, losses continue
to mount, with a first-quarter (ended Oct. 30, 2002) net loss of
C$15.6 million versus a loss of C$12.4 million in 2001. SWP's
management continues to implement cost-cutting and balance-sheet
management in the context of one of the worst ever periods of
drought to affect Canada.

The pool is currently in the midst of a financial restructuring
that has yet to be approved by either its banks or bondholders.
The proposed amendments call for an increase and extension of
SWP's senior secured facilities of up to C$375 million, in
combination with a proposed refinancing of existing bank debt
into new public notes. The new facilities would be used to
refinance existing bank debt, to finance the phase-out of the
company's securitization program, and to provide a source of
working capital.

Standard & Poor's will closely monitor upcoming events, namely
January 18, 2003, when SWP's next interest payment is due, as
well as whether a successful restructuring may be successfully
implemented by month's end. Failure in either case may result in
a lowering of the credit ratings on the company.

SEDONA CORP: Shares Knocked Off Nasdaq, Now Trading on OTCBB
SEDONA(R) Corporation (Nasdaq:SDNA) --
-- a provider of Internet-based Customer Relationship Management
solutions for small and mid-sized financial services companies,
announced that its class of Common Stock will be delisted from
the Nasdaq Small Cap Market and will be quoted on the OTC
Bulletin Board effective with the open of business on January 9,
2003 under the symbol SDNA.

SEDONA Corporation (Nasdaq:SDNA) provides Customer Relationship
Management (CRM) solutions specifically tailored for small and
mid-sized financial services businesses such as community banks,
credit unions, insurance companies, and brokerage firms. By
using SEDONA's CRM solutions, financial institutions can
effectively identify, acquire, foster, and retain loyal,
profitable customers. SEDONA Corporation is an Advanced Level
Business Partner of IBM(R) Corporation.

For additional information, visit the SEDONA web site at
http://www.sedonacorp.comor call 800/815-3307

As previously reported in the November 22, 2002 edition of the
Troubled Company Reporter, SEDONA(R) announced that a funding
that would have provided needed working capital was not
completed last week as had been anticipated, and it has taken
steps to limit its expenses while it seeks additional funding.

The Company has been successful in aligning itself with some of
the finest financial services companies in the market as their
provider of a comprehensive analytical CRM solution for their
customers and it has continued to demonstrate improvements in
revenues and reduced operating expenses. Nevertheless, the
Company has experienced lengthened timeframes for raising the
necessary working capital.

The Company is aggressively pursuing several alternatives and
anticipates this concern will be resolved. If such funding does
not become available on a timely basis, however, the Board will
explore additional alternatives to preserving value for our
creditors and stockholders which may include a sale of all or
part of the Company or a reorganization or liquidation of the

SL INDUSTRIES: Sells German Unit Electro-Metall for $11.6 Mill.
SL Industries, Inc. (NYSE and PHLX:SL), sold its German
subsidiary, Electro-Metall Export GmbH for a purchase price of
$11.6 million, which consisted of cash, purchaser notes and
assumption of bank debt.

The purchaser notes are comprised of a $3 million secured note
that bears interest at the prime rate plus 2% and matures no
later than May 1, 2003, and a $1 million unsecured note that
bears interest at an annual rate of 12% and matures April 3,
2004. Cash proceeds were used to pay down debt. After giving
effect to such debt repayment, the Company's outstanding bank
debt is approximately $10.4 million.

EME is a producer of electronic actuation devices and cable
harness systems sold primarily to original equipment
manufacturers in the aerospace and automotive industries. Its
operations are located in Ingolstadt, Germany and Paks, Hungary.
EME is expected to report sales of approximately $ 27 million
and net income of approximately $1.7 million for the 2002
calendar year.

As a result of the transaction, SL's net worth is expected to
decrease by approximately $3.5 million. The transaction is not
anticipated to be a taxable event.

The Company further announced that it entered into a three-year
senior secured credit facility with LaSalle Business Credit LLC.
The credit facility provides for a maximum indebtedness of $20
million, with a revolving tranche and a term debt tranche.
Outstanding indebtedness under this facility bears interest
ranging from the prime rate plus fifty basis points to the prime
rate plus 2%.

The credit facility is secured by all of the Company's U.S.
assets and requires that the Company maintain specified
financial ratios. Loan proceeds were used to retire the
Company's pre-existing debt, which matured on December 31, 2002,
and for working capital purposes.

Warren Lichtenstein, Chairman and Chief Executive Officer of SL
Industries, Inc., said, "We are pleased to report the sale of
the Company's EME subsidiary. These transactions represent
strategic steps to maximize the value of the Company for its

Lichtenstein continued, "I would also like to note the
significance of the Company's new credit arrangement with
LaSalle Business Credit LLC. We believe that this credit
facility will provide ample liquidity to take advantage of
market opportunities and sufficient flexibility to maintain a
balanced capital structure. More importantly, we expect that the
new credit facility will provide much needed financial stability
by substituting a new lender interested in developing a
cooperative business relationship. We look forward to working
with LaSalle Business Credit LLC as we continue to implement the
Company's business plan."

SL Industries, Inc. designs, manufactures and markets Power and
Data Quality (PDQ) equipment and systems for industrial,
medical, aerospace, telecommunications and consumer
applications. For more information about SL Industries, Inc. and
its products, please visit the Company's web site at

                            *   *   *

As reported in Troubled Company Reporter's Nov. 8, 2002,
Edition, SL Industries said that "despite [their] best efforts,
[the Company was] unable to complete the refinancing of the
Company's line of credit by October 31, 2002. As a result, the
Company paid its lenders a facility fee of $780,000, as provided
in its credit agreement, which will impact fourth quarter
financial results. [The Company is] continuing to work towards
refinancing the credit line prior to the maturity date of
December 31, 2002."

On May 23, 2002, the Company and its lenders reached an
agreement, pursuant to which the lenders granted a waiver of
default and amended certain financial covenants of the Company's
revolving credit facility, so that the Company is in full
compliance with the revolving credit facility after giving
effect to the Amendment.

SL Industries, Inc., has retained Imperial Capital, LLC to act
as its financial advisor.

SORRENTO: Convertible Debt Holders Support Restructuring Plan
Sorrento Networks (Nasdaq NM: FIBR), a leading supplier of
intelligent optical networking solutions for metro and regional
applications, provided an update on its progress in completing
the capital restructuring plan announced on December 11, 2002.

The Company announced that all of its convertible debenture
holders have executed waiver and consent forms in which they
agree to support the capital restructuring plan announced in
December. Accordingly, the convertible debenture holders were
paid an aggregate consent fee of $320,000 on Jan. 7, 2003, in
lieu of the quarterly interest payment, which would have been
approximately $785,000.

The Company continues to work towards completing the
restructuring plan by the end of March 2003, subject to, among
other things, execution of definitive agreements with the Series
A investors and the convertible debenture holders, and approval
of a majority of common shareholders.

"Receiving consent from 100% of the convertible debenture
holders is a strong indication of the commitment of our
investors to survival and success of the Company," commented
Phil Arneson, Sorrento Networks' Chairman and Chief Executive
Officer. "While there is still much work ahead of us, we are
encouraged by the progress that we have achieved and look
forward to the remaining challenges to complete this capital

Sorrento Networks, headquartered in San Diego, is a leading
supplier of intelligent optical networking solutions for metro
and regional applications worldwide. Sorrento Networks' products
support a wide range of protocols and network traffic over
linear, ring and mesh topologies. Sorrento Networks' existing
customer base and market focus includes communications carriers
in the telecommunications, cable TV and utilities markets. The
storage area network (SAN) market is addressed though alliances
with SAN system integrators. Recent news releases and additional
information about Sorrento Networks can be found at

At October 31, 2002, Sorrento's balance sheet shows a working
capital deficit of about $30 million. The Company's total
shareholders' equity deficit widened to about $19.8 million,
from a deficit of about $18 million (Jan. 31, 2002).

STARWOOD HOTELS: Sets Q4 Earnings Release Date for Jan. 29, 2003
Starwood Hotels & Resorts Worldwide, Inc. (NYSE: HOT) will
release the Company's fourth quarter financial results prior to
market open on Wednesday, January 29, 2003, followed by a
conference call at 10:30 a.m. (eastern).

The conference call will include a brief discussion of the
quarter followed by questions and answers. The call will be
moderated by Dan Gibson, Senior Vice President, Corporate
Affairs and will include remarks by Barry Sternlicht, Chairman
and Chief Executive Officer and Ron Brown, Executive Vice
President/Chief Financial Officer.

Participants may listen to the simultaneous webcast of the
conference call by logging onto the company website,choosing "Press Releases" within the
Investor Relations section of the website at 10:30 a.m.

In addition, a replay has been arranged, which will air from
Wednesday, January 29 at 1:30 p.m. (eastern) through Wednesday,
February 5 at 8:00 p.m. The replay will be available on the
Company's website or by dialing 719-457-0820 (access code is

Starwood Hotels & Resorts Worldwide, Inc. -- whose
$1.3 billion bank facility is currently rated by Fitch at BB+ --
is one of the leading hotel and leisure companies in the world
with more than 750 properties in more than 80 countries and
110,000 employees at its owned and managed properties. With
internationally renowned brands, Starwood is a fully integrated
owner, operator and franchisor of hotels and resorts including:
St. Regis, The Luxury Collection, Sheraton, Westin, Four Points
by Sheraton, W brands, as well as Starwood Vacation Ownership,
Inc., one of the premier developers and operators of high
quality vacation interval ownership resorts. For more
information, please visit

SYBRON DENTAL: First Quarter Conference Call Set for January 28
Sybron Dental Specialties, Inc. (NYSE: SYD), announced that on
Tuesday, January 28, 2003 at 1:00 p.m. ET, it will host a
conference call to discuss its first quarter financial results
for the period ended December 31, 2002.

      The dial-in numbers for the teleconference will be:
      Domestic Callers (800) 450-0819
      International Callers (612) 332-0820

This call is being webcast by CCBN and can be accessed at Sybron
Dental Specialties web site at

A replay of the call will be accessible from January 28, 2003 at
7:30 p.m. ET through January 31, 2003 at 11:59 p.m. ET by

      Domestic Callers (800) 475-6701
      International Callers (320) 365-3844
      Access Code:  670573

The subsidiaries of Sybron Dental Specialties are leading
manufacturers of value-added products for the dental and
orthodontic professions and products for use in infection
control.  The primary subsidiaries of Sybron Dental are Kerr and
Ormco.  Kerr Corporation develops, manufactures, and sells
through independent distributors a comprehensive line of
consumable general dental and infection prevention products to
the dental industry worldwide.  Ormco develops, manufactures,
markets and distributes an array of consumable orthodontic and
endodontic products worldwide.

                          *   *   *

As previously reported, Standard & Poor's assigned a single-'B'
rating to Sybron Dental Specialties Inc.'s proposed $150 million
10-year senior subordinated notes. Sybron, a leading
manufacturer of professional dental products, plans to use the
proceeds from this offering to repay bank debt and lengthen its
maturity schedule. At the same time, Standard & Poor's assigned
a double-'B'-minus rating to Sybron's $350 million dollar senior
secured credit facility. Total rated debt outstanding for the
company is approximately $360 million.

The speculative-grade ratings on Sybron reflect its position as
a leading manufacturer of professional dental products, offset
by the challenges of effectively operating its expanding
business while shouldering debt associated with its late-2000

TEREX CORP: J.C. Watts, Jr. Elected to Board of Directors
The Board of Directors of Terex Corporation (NYSE:TEX), a global
manufacturer of heavy equipment for the construction, mining,
and aggregates industries, announced the election of former U.S.
Congressman J.C. Watts, Jr., 45, to the Company's Board.

Congressman Watts represented Oklahoma's 4th District in the
U.S. House of Representatives for eight years until January 7,

Widely recognized for his unique leadership abilities,
Congressman Watts was elected Chairman of the House Republican
Conference, the fourth highest position in that body, in 1998
and was re-elected to the post unanimously two years later. He
served on a number of key committees during his tenure in
Congress, including the Armed Services Committee, the Select
Homeland Security Committee, the Military Readiness
Subcommittee, and the Procurement Subcommittee. As a rising star
in his party, Congressman Watts also served as Honorary Co-
Chairman of the 2000 Republican National Convention that
nominated George W. Bush for the presidency.

Commenting on the appointment of Terex's newest Board member,
Terex Chairman and CEO Ronald M. DeFeo said, "In an era when
corporate governance is under such intense scrutiny, we are
especially pleased to have someone with J.C. Watts' stature and
reputation joining our Board. His exemplary service in Congress
won him universal respect and admiration from both sides of the
aisle. Having represented a state where Terex has major
facilities, he knows our company and its operations. J.C. Watts'
independence, judgment, insights, and experience will make a
major contribution to shaping our company's future direction and

Mr. DeFeo went on to add, "Congressman Watts has earned a solid
reputation both in Oklahoma and nationally as a perceptive,
passionate, and eloquent spokesman for improving and re-
developing local communities, fiscal discipline, strengthening
education, upholding family values, and bolstering the nation's
defense. The Congressman has also been a long-time supporter of
historically black colleges, trade with Africa, and using tax
incentives to support community development in impoverished

Football fans remember J.C. Watts as one of the college game's
authentic heroes. Before graduating from the University of
Oklahoma in 1981 with a bachelor's degree in journalism,
Congressman Watts quarterbacked the Sooners to two Big Eight
Championships and two Orange Bowl victories. Following college,
he turned professional and played for five seasons in the
Canadian Football League.

Most recently, Congressman Watts has been traveling the country,
promoting his new book, "What Color is a Conservative. My Life
and My Politics," published by HarperCollins. He and his wife,
Frankie, are the parents of five children and currently reside
in Norman, Oklahoma.

Terex Corporation is a diversified global manufacturer based in
Westport, Connecticut, with pro forma 2001 annual revenues of
$3.4 billion. Terex is involved in a broad range of
construction, infrastructure, recycling and mining-related
capital equipment under the brand names of Advance, American,
Amida, Atlas, Bartell, Bendini, Benford, Bid-Well, B.L. Pegson,
Canica, Cedarapids, Cifali, CMI, Coleman Engineering, Comedil,
CPV, Demag, Fermec, Finlay, Franna, Fuchs, Genie, Grayhound, Hi-
Ranger, Italmacchine, Jaques, Johnson-Ross, Koehring, Lectra
Haul, Load King, Lorain, Marklift, Matbro, Morrison, Muller,
O&K, Payhauler, Peiner, Powerscreen, PPM, Re-Tech, RO, Royer,
Schaeff, Simplicity, Square Shooter, Telelect, Terex, and Unit
Rig. More information on Terex can be found at

                          *   *   *

As reported in Troubled Company Reporter's Sept. 18, 2002
edition, Standard & Poor's assigned its double-'B'-minus secured
bank loan rating to Terex Corp.'s proposed $210 million new term
loan C maturing in December 2009. Proceeds from this loan and
about $60 million in Terex common stock will be used to finance
the acquisition of Genie Holdings Inc. for $270 million. In
addition, the double-'B'-minus corporate credit rating was
affirmed on Westport, Connecticut-based Terex, a manufacturer of
construction and mining equipment. Total rated debt is $1.6
billion. The outlook is stable.

"Terex has a highly leveraged capital structure due to its
aggressive growth strategy. However, the company's cash flow
generation and sizable cash balances, along with its use of
equity as currency for acquisitions, should permit Terex to
continue to make moderate-size acquisitions without material
deterioration in its financial profile," said Standard & Poor's
credit analyst John Sico. Terex maintains a $300 million
revolving credit facility and has a cash position of more than
$200 million.

The bank loan is rated the same as the corporate credit rating.
The total senior secured credit facility of $885 million is
comprised of a revolving credit facility of $300 million, a term
loan B of $375 million, and the new term loan C of $210 million.
The facility is secured by substantially all of the company's
assets. Under Standard & Poor's simulated default scenario, the
company's cash flows were stressed and the resulting enterprise
value would not be sufficient to cover the entire bank loan in
the event of a default. However, there is reasonable confidence
of meaningful recovery of principal, despite potential loss

TYCO INT'L: Appoints W. Mark Schmitz as Vice President, Finance
Tyco International Ltd. (NYSE: TYC; BSX: TYC; LSE: TYI)
announced the appointment of W. Mark Schmitz as Vice President,
Finance of Tyco Fire and Security.  Mr. Schmitz succeeds Skip
Heger, who retired as Vice President of Finance after 22 years
of service to Tyco Fire and Security and its predecessor

As Tyco Fire and Security's top financial officer, Mr. Schmitz
will report to David FitzPatrick, Executive Vice President and
Chief Financial Officer of Tyco.

Mr. FitzPatrick said:  "I have worked with Mark Schmitz in the
past and have great confidence in his ability.  Mark joins the
Company with a solid background in manufacturing and service
companies, which, together with his experience in international
finance, will make him an important asset to Tyco Fire and
Security's finance team.  I look forward to working with him
again in our important Fire and Security division."

Jerry R. Boggess, President of Tyco Fire and Security, said:  "I
am pleased to have Mark Schmitz become a member of our executive
team.  His vast experience and knowledge of corporate finance
will make him a great asset to the Company.  He is an
outstanding leader with an exceptional reputation in the
financial community."

Mr. Schmitz said:  "Tyco Fire and Security is a great business
with tremendous potential for growth, given the increasing
global concerns about every aspect of safety.  I am excited
about the challenges of this new opportunity and I look forward
to working closely with my new colleagues."

Mr. Schmitz joins Tyco from Plug Power Inc., where he had served
as Vice President and Chief Financial Officer since 2001.  Prior
to joining Plug Power, Mr. Schmitz spent 22 years at General
Motors Corporation.  While at GM, Mr. Schmitz served as Vice
President and Chief Financial Officer of DirecTV Latin America
where he was responsible for finance and operations throughout
Latin America and the Caribbean.  He also held numerous
positions while working for General Motors do Brasil in Sao
Paulo, Brazil, including Executive Director of Finance,
Treasurer, Controller and President of GM's finance company in
Brazil, Banco General Motors.

Earlier in his career, Mr. Schmitz was an Executive Assistant to
the President and CEO of GM in Detroit.  He also held various
analyst and managerial positions at General Motors, including
controllership of one of the North American car groups and
Director of Capital Analysis and Planning in the New York
Treasurer's Office.  Mr. Schmitz received his MBA in Finance
from Ohio State University and a BA in Chinese Language and
Literature from Ohio State University.

Tyco International Ltd. is a diversified manufacturing and
service company.  Tyco is the world's largest manufacturer and
servicer of electrical and electronic components; the world's
largest designer, manufacturer, installer and servicer of
undersea telecommunications systems; the world's largest
manufacturer, installer and provider of fire protection systems
and electronic security services and the world's largest
manufacturer of specialty valves.  Tyco also holds strong
leadership positions in medical device products, and plastics
and adhesives.  Tyco operates in more than 100 countries and had
fiscal 2002 revenues from continuing operations of approximately
$36 billion.

                  About Tyco Fire and Security

Tyco Fire & Security designs, manufactures, installs and
services electronic security systems, fire protection, detection
and suppression systems, sprinklers and fire extinguishers.
Tyco Fire & Security includes more than 60 brands, which are
represented in more than 100 countries.  Its products are used
to safeguard firefighters, prevent and fight fires, deter
thieves and protect people and property.

DebtTraders reports that Tyco International Group's 6.875% bonds
due 2002 (TYC02USR1) are trading at 96 cents-on-the-dollar. See
real-time bond pricing.

TYCO INT'L: Exercises Option to Buy Additional $750MM Debentures
Tyco International Ltd. (NYSE - TYC, BSX - TYC, LSE - TYI)
announced that the initial purchasers of its announced private
placement of $2.5 billion principal amount of 2.75% Series A
Convertible Senior Debentures due 2018 and $1.25 billion
principal amount of 3.125% Series B Convertible Senior
Debentures due 2023 through its wholly-owned subsidiary, Tyco
International Group S.A., have exercised their option to buy up
to an additional 20% of debentures in full, resulting in the
sale of an additional $500 million principal amount of 2.75%
Series A Convertible Senior Debentures due 2018 and $250 million
principal amount of 3.125% Series B Convertible Senior
Debentures due 2023.  With the exercise of the option, the total
size of the offering rises to $4.5 billion.  The placement of
all of the debentures is expected to close on January 13, 2003.
Tyco intends to use the net proceeds to repay debt and for
general corporate purposes.

The debentures will be offered to qualified institutional buyers
in reliance on Rule 144A under the Securities Act of 1933.  The
debentures will not be registered under the Securities Act.
Unless so registered, the debentures may not be offered or sold
in the United States except pursuant to an exemption from, or in
a transaction not subject to, the registration requirements of
the Securities Act and applicable state securities laws.

Tyco International Ltd. is a diversified manufacturing and
service company. Tyco operates in more than 100 countries and
had fiscal 2002 revenues from continuing operations of
approximately $36 billion.

UNITED AIRLINES: Flight Attendants Ratify Interim Relief Pact
United Airlines flight attendants, represented by the
Association of Flight Attendants, AFL-CIO, agreed to make
extraordinary sacrifices today by ratifying an Interim Letter of
Agreement with the airline that provides for a temporary nine
percent cut in total flight attendant compensation.

The AFA United Master Executive Council recommended flight
attendants vote "FOR" the agreement. Sixty-two percent of
eligible flight attendants voted, with 94 percent of valid
ballots cast "FOR" ratification of the agreement.

"This cut is very painful, especially since flight attendant
compensation is so minimal to begin with," said United AFA MEC
President Greg Davidowitch. "Flight attendants have once again
shown that we are committed to seeing our airline successfully
emerge from bankruptcy."

The nine percent interim cut in total flight attendant
compensation will be accomplished through the elimination of
COLA (cost of living) payments for the duration of the interim
agreement, and an 8.16% reduction in base wage rates and all
other pay factors including reserve override, understaffing pay,
training pay, qualified and non-qualified purser pay, language
qualified and language incentive pay, night pay, and ground pay.

The interim agreement will become effective if the airline gets
similar voluntary or court-mandated agreements on interim
concessions with all other work groups at the airline. If all
groups participate in providing interim relief through
ratification or court order, United will be able to meet the
strict requirements of its financers in the bankruptcy process
earlier than expected, allowing the parties an extended period
of negotiations over a final, comprehensive agreement on flight
attendant participation in United's restructuring.

"United management has been less than forthcoming with the
information necessary for our full participation in the
airline's restructuring," Davidowitch said. "The flight
attendants are willing to work with management to successfully
restructure, but airline executives have to provide us with
access to the information we need and with a clear plan and
reasons for the changes they are requesting going forward.

"Recognizing the contributions of frontline employees is a key
to this process because bankruptcy doesn't end well when the
workers and management are not on the same page," said

More than 50,000 flight attendants, including the 24,000 flight
attendants at United, join together to form AFA, the world's
largest flight attendant union. Visit

UNITED AIRLINES: Applauds Flight Attendants' Support of Pact
UAL Corp. (NYSE: UAL), the parent company of United Airlines,
commented on the ratification of an agreement on interim wage
reductions by the Association of Flight Attendants, the union
representing United's flight attendants. The memberships of
three other unions representing United employees -- the Air Line
Pilots Association, Professional Airline Flight Control
Association  and Transport Workers Union -- announced that their
members voted to ratify their own interim wage reductions.

Glenn Tilton, chairman, president and chief executive officer of
UAL, said, "We are grateful for the support the AFA membership
has shown in voting for this agreement. We know this was a very
difficult decision for them to make. The ratification by all
four unions confirms what we have been hearing from employees
throughout the company: That they are committed to United and
ready to do the work that it will take to make this organization
a long-term success. We look forward to continuing to meet and
work with our unions to reach consensual agreements that will
enable us to create a more durable and competitive business."

The wage reduction agreements were ratified by the unions in
conjunction with UAL's filing of an 1113c motion as part of the
company's Chapter 11 case. Pending court approval, these
agreements will help the company meet the terms of its DIP
financing and provide more time for negotiation of long-term
wage and work rule changes between UAL and the unions. In
addition, United has asked the court to impose interim wage
reductions under Section 1113(e) of the Bankruptcy Code for
employees represented by the International Association of
Machinists and Aerospace Workers (IAM) District 141 and 141-M,
because this union did not reach interim agreements on wage
reductions with the company. The Court is expected to rule on
UAL's 1113(e) motion against the IAM by January 10, 2003.

                        About UAL

United Airlines operates more than 1,700 flights a day on a
route network that spans the globe. News releases and other
information about United Airlines can be found at the company's
website at

UNITED AIRLINES: Seeks to Employ Paul Hastings as Labor Counsel
United Airlines Inc. and its debtor-affiliates submit an
Application for authority to employ and retain the law firm of
Paul, Hastings, Janofsky & Walker LLP, as special labor counsel
and special litigation counsel in these Chapter 11 cases.

The Debtors seek to retain Paul Hastings to handle the Special
Counsel Matters because of:

    (a) Paul Hastings' extensive experience and expertise with
        labor law issues in the airline industry, especially with
        the Railway Labor Act;

    (b) Paul Hastings' extensive experience and expertise on
        labor law issues in airline bankruptcy proceedings;

    (c) Paul Hastings' extensive experience and expertise in
        general litigation matters and court proceedings; and

    (d) the general knowledge and information that Paul Hastings
        obtained regarding the Debtors and their businesses and
        operations as a result of Paul Hastings' prepetition
        services to the Debtors.

Paul Hastings' has extensive prior experience in airline labor
law, airline bankruptcy proceedings, and the interplay between
labor law and the Bankruptcy Code.  Paul Hastings' attorneys
have represented numerous air carriers on a broad range of
Railway Labor Act issues for many years, including collective
bargaining, arbitration and litigation.  Paul Hastings'
attorneys have also served as special labor counsel to debtors
in prior airline bankruptcy cases.  For example, Paul Hastings'
attorneys served as labor counsel for Continental Airlines in
its negotiations with Frontier Airlines while Frontier was in
Chapter 11; those negotiations resulted in the Frontier-
Continental Job Protection Agreement, which provided for the
transition of Frontier employees to Continental.  Paul Hastings'
attorneys have also written a white paper entitled "An Unhappy
Crossroads: The Interplay of Bankruptcy and Airline Labor Lawc"
(American Law Institute of American Bar Association, Seminar on
Airline and Railroad Labor and Employment Law, April 4-6, 2002)
(at 723-752).

The Debtors seek authorization to retain Paul Hastings as
special labor counsel to provide services as requested by the
Debtors on issues that may arise during the Chapter 11 cases
related to:

    1) all aspects of labor relations, including issues related
       to the International Association of Machinists, collective
       bargaining issues, and issues arising under the Railway
       Labor Act and under Sections 1113 and 1114 of the
       Bankruptcy Code; and

    2) litigation related to such issues.

Paul Hastings has represented the Debtors on labor law issues
since 2000, James H.M. Sprayregen tells the Court.  In
particular, Paul Hastings represented the Debtors in the
preparation and presentation of United's case before the
Presidential Emergency Board, which was convened to investigate
United's collective bargaining dispute with the International
Association of Machinists and Aerospace Workers, District 141 M.
Also, Paul Hastings represented the Debtors in pre-petition
collective bargaining with the IAM District 141 and IAM District
141M.  As a result of its efforts over the past two years, Paul
Hastings is intimately familiar with the complex legal issues
that have arisen and are likely to arise in connection with the
Debtors' labor issues.

Additionally, Paul Hastings has handled general litigation
matters for the Debtors since 1985.  Paul Hastings has
represented the Debtors in several matters since as early as
2000.  Paul Hastings is particularly well suited to serve as
special litigation counsel because of its experience in handling
litigation matters for airline clients.

The interruption and the duplicative cost involved in obtaining
substitute counsel to replace Paul Hastings' unique role at this
juncture would be extremely harmful to the Debtors, their
estates, and their creditors.  Were the Debtors required to
retain other counsel, all parties in interest would be unduly
prejudiced by the time and expense to replicate Paul Hastings'
ready familiarity with the intricacies of airline labor law, its
interface with the Bankruptcy Code, and the specific issues
confronting the Debtors.  Further, Paul Hastings has a national
and international reputation and extensive experience and
expertise in airline labor law and litigation.  The Debtors
submit that Paul Hastings is well qualified and uniquely able to
provide the specialized legal advice sought by the Debtors on a
going-forward basis.  Paul Hastings' retention as special
counsel is in the best interest of the Debtors and their

John J. Gallagher, Esq., assures the Court that no person at
Paul Hastings has any connection with the Debtors, their
creditors, the United States trustee or any other party with an
actual or potential adverse interest to the Debtors.

Mr. Gallagher discloses that his firm represented and represents
both Rolls Royce and General Electric Capital Corporation.
However, the Debtors have consented to the request for a written
waiver of any potential conflicts of interest in the event that
Paul Hastings' services are requested by Rolls-Royce or GECC in
matters relating to the Debtors, provided that Paul Hastings
maintains complete separation in an Ethical Wall between the
attorneys, files and information relating to representation of
Debtors and those relating to representation of Rolls-Royce
and/or GECC.  Paul Hastings will not represent Rolls-Royce
and/or GECC in matters where it seeks to be employed in these

Mr. Gallagher indicates that subject to the Court's approval,
Paul Hastings intends to

    a) charge for its legal services on an hourly basis in
       accordance with its ordinary and customary hourly rates in
       effect on the date services are rendered; and

    b) seek reimbursement of actual and necessary out
       of pocket expenses.

Paul Hastings' rates may change from time to time.  Paul
Hastings will maintain detailed, contemporaneous records of time
and any actual and necessary expenses incurred in connection
with legal services and the nature of services.  The Lead
Attorneys who will work on United-related matters are:

            Name                    Hourly Rate
            -----                   -----------
            John J. Gallagher          $475
            Robert S. Span             $490
            Dianne C. Coombs           $360
            Jami L. Copeland           $335
            Scott M. Flicker           $415
            Jon A. Geier               $425
            John S. Gibson             $450
            Douglas C. Griffith        $365
            Neal D. Mollen             $400
            J. Mark Poerio             $495
            John R. Sabatini           $315
            Margaret H. Spurlin        $405
            Alan K. Steinbrecher       $490
            Katherine A. Traxler       $485
            David M. Walsh             $465
            C. Scott Williams          $285
            Ken M. Willner             $415

Paul Hastings received from the Debtors a total of approximately
$1,792,000 for services rendered, and costs and expenses
incurred.  Before the Petition Date, Paul Hastings also received
a Retainer of approximately $300,000 for services to be
rendered, and costs and expenses to be incurred, in connection
with these cases.  Paul Hastings placed the Retainer in a client
trust account, from which it intends to draw down funds.

Paul Hastings and the Debtors considered many factors in
determining the amount of the Retainer, including: (a) the size
and nature of the Debtors' operations; (b) the probable duration
for the chapter 11 cases and the time that Paul Hastings will
need to devote to the Debtors; and (c) the fact that Paul
Hastings expects to incur significant out-of-pocket expenses in
the course of rendering its professional services. (United
Airlines Bankruptcy News, Issue No. 4; Bankruptcy Creditors'
Service, Inc., 609/392-0900)

UNITED STATIONERS: Reports Preliminary Fourth Quarter Results
United Stationers Inc. (Nasdaq: USTR) reported preliminary sales
and earnings for the three months ended December 31, 2002. The
preliminary results are subject to the closing of United's
financial records and completion of the 2002 annual audit.

               Preliminary Fourth Quarter Results

Preliminary sales for the fourth quarter ended December 31,
2002, are expected to be approximately $923 million, down 1.4%,
compared with $936 million a year ago. Sales per workday were
lower in December than November and were particularly soft in
the last two weeks of the month due to the midweek timing of the
holidays. The lower sales also reflect continued weakness in the
overall economy.

Gross margin remained under pressure in the fourth quarter, with
the weak economy contributing to an unfavorable product mix. The
lower-margin computer consumables product category grew as a
percentage of total sales, while higher-margin categories, such
as furniture and office supplies, declined as a percentage of
total sales. In addition, the lower sales and shift in product
mix resulted in a fourth quarter downward adjustment of volume
allowances earned from the company's suppliers for 2002. As a
result, gross margin for the quarter is expected to be
approximately 13.7%, compared with 14.6% in the third quarter of
2002 and 15.6% in the fourth quarter of 2001.

The operating expense ratio for the fourth quarter of 2002 will
be higher than originally anticipated primarily due to lower
sales volume and other incremental expenses. These incremental
fourth quarter expenses include costs relating to the company's
chief executive officer succession (including the previously
announced $1.8 million charge relating to the retirement of
United's former president and chief executive officer). The
company expects to reduce its operating expenses in future
quarters through operational initiatives.

United will record pre-tax restructuring and other charges, as
described below, of approximately $9 million, or $0.17 per share
after-tax, in the fourth quarter of 2002. These charges are
comprised of future cash payments of $7 million and a non-cash
charge of $2 million.

As a result of all these factors, including the restructuring
and other charges, the company expects reported earnings per
share for the fourth quarter of 2002 to be in the range of $0.02
to $0.05 per share, compared with $0.57 per share in the fourth
quarter of 2001.

               Restructuring and Other Charges

The company approved a restructuring plan in the fourth quarter
of 2002. This plan includes additional charges related to
revised real estate sub-lease assumptions as compared to those
used in the 2001 restructuring plan; a further downsizing of The
Order People operation, including severance and anticipated exit
costs related to a portion of the company's Memphis distribution
center; and closure of the Milwaukee, Wisconsin distribution
center. Other charges include the write-off of certain e-
commerce-related investments.

The restructuring charge is expected to result in annual pre-tax
savings of approximately $2 million beginning in 2003.

"The excess capacity in our Memphis distribution center related
to The Order People would have continued to put pressure on
earnings," said Dick Gochnauer, president and chief executive
officer. "This is a necessary step to rationalize our

                       2003 Outlook

"We are very disappointed with our financial performance in
2002. However, we are working hard to deliver better results in
the future. On a positive note, our strong balance sheet gives
us the resources to weather the current economic pressures and
also allows us to continue to repurchase our stock," added

"Entering 2003, we look back at a year that has been
particularly challenging for United. While we are making
operational improvements to drive efficiencies, sales and margin
erosion present an ongoing challenge. With the downsizing of
corporate America, there are fewer consumers of office products.
Given today's uncertain business climate, lowering our cost base
is one of our top priorities this year. We are confident the
actions we are taking to do this will position us to capitalize
on future market opportunities," concluded Gochnauer.

               Fourth Quarter Conference Call

United Stationers will report its financial results for the
fourth quarter and year-end on Thursday, January 30. This will
be followed by a conference call with a question and answer
session on Friday, January 31, at 9:00 a.m. CT, to provide
further details of its restructuring plan and to discuss its
recent performance. To listen to the conference call, visit the
investor relation's section of the company's Web site at at least 15 minutes before the call,
and follow the instructions provided to ensure that the
necessary audio application is downloaded and installed. This
program is provided at no charge to the user. In addition,
interested parties can access an archived version of the call,
which also will be located on the investor relations section of
United Stationers' Web site, about two hours after the call ends
and for the following week.

                     Company Overview

United Stationers Inc., with annual sales of approximately $3.7
billion, is North America's largest wholesale distributor of
business products and a provider of marketing and logistics
services to resellers. Its integrated computer-based
distribution system makes more than 40,000 items available to
approximately 20,000 resellers. United is able to ship products
within 24 hours of order placement because of its 35 United
Stationers Supply Co. distribution centers, 24 Lagasse
distribution centers that serve the janitorial and sanitation
industry, two Azerty distribution centers in Mexico that serve
computer supply resellers, and two distribution centers that
serve the Canadian marketplace. Its focus on fulfillment
excellence has given the company an average order fill rate of
98%, a 99.5% order accuracy rate, and a 99% on-time delivery
rate. For more information, visit

The company's common stock trades on the Nasdaq National Market
System under the symbol USTR and is included in the S&P SmallCap
600 Index.

As previously reported, Standard & Poor's affirmed United
Stationer's BB Corporate Credit Rating.

VENTURE HOLDINGS: Rating on $205M Sr. Notes Cut to Default Level
Standard & Poor's Ratings Services lowered its rating on Fraser,
Michigan-based Venture Holdings Co. LLC's $205 million senior
notes due 2005 to 'D' from 'CC' following the company's failure
to make the January 1, 2003, interest payment due on the notes.
The rating was removed from CreditWatch, where it was placed on
December 19, 2001. The corporate credit rating on the company is
'SD' (selective default). The 'CCC' senior secured debt rating
remains on CreditWatch with negative implications.

A forbearance agreement with its bank lending group dated Oct.
21, 2002, prevents Venture from paying interest on its public
bonds. The forbearance agreement expires on April 15, 2003.
Venture is working with its creditors, customers, and
shareholder to restructure and recapitalize the company
following the Oct. 1, 2002, commencement of formal insolvency
proceedings of its German subsidiary, Peguform GmbH. Venture had
opposed the insolvency proceedings. Peguform, which accounted
for 70% of Venture's 2001 sales, is being sold by a court-
appointed administrator. The potential magnitude and ultimate
distribution of sale proceeds in excess of Peguform's
obligations are unclear.

"Although the loss of Peguform's cash flow has severely weakened
Venture's ability to service its financial obligations, the
company continues to make required bank loan payments," Standard
& Poor's credit analyst Martin King said. In addition, Venture's
sole equity holder, Larry Winget, has provided secured

WORLDCOM INC: Hires PricewaterhouseCoopers as Special Advisors
Worldcom Inc., and its debtor-affiliates sought and obtained the
Court's authority to employ PricewaterhouseCoopers LLP as
advisors to the Special Committee of the Board of Directors as
well as special advisors to the Debtors on accounting, tax and
financial matters in these Chapter 11 cases.

WorldCom Chief Financial Officer John S. Dubel relates that as
of July 1, 2002, Wilmer, Cutler & Pickering engaged PwC on its
own behalf and in connection with its representation of the
Audit Committee of the Debtors' Board of Directors.
Historically, PwC provided special accounting, tax and financial
consulting services to the Debtors.  As of the Petition Date,
these services include:

   -- Services rendered to the Special Committee:

       * Forensic accounting, related investigation and
         consulting services for the Audit Committee of
         WorldCom's Board of Directors with respect to accounting
         and financial reporting matters affecting the Debtors,
         including related assistance with any regulatory
         proceedings and litigation; and

   -- Special accounting, tax and financial consulting services
      to the Debtors:

       * Performing a comprehensive analysis of the Debtors'
         federal income tax account as well as employment and
         excise taxes for all open tax periods, as applicable.
         The purpose of this review is to locate potential errors
         and, if appropriate, secure refunds for the Debtors.
         PwC expects that for most entities this will encompass
         tax years beginning with 1991;

       * Preparing 2001 and, if applicable, prior periods
         corporate income tax returns for WorldCom's entities in
         these jurisdictions: Austria, Denmark, Finland, France,
         Germany, Ireland, Italy, Netherlands, Norway, Spain,
         Sweden, Switzerland, Canada, South Africa, Belgium,
         Portugal, Russia, China, Luxembourg, Greece, Hungary,
         Israel, Poland, Hong Kong, Korea, Singapore, India,
         United Kingdom, Japan, Malaysia, Philippines, Czech
         Republic, Australia, Taiwan, Indonesia, and New Zealand;

       * Providing testing of the telecommunications services
         provided by the Debtors at facilities run by the
         Department of Corrections-Commonwealth of Virginia;

       * Developing and configuring software for the Debtors to
         help identify and capture cost reductions;

       * Performing agreed-upon procedures for the Debtors and GE
         Information Systems with regard to a network services
         billing dispute between the Debtors and GE Information
         Systems; and

       * The Debtors seek to have PwC continue rendering services
         on the preceding projects in place as of the Petition
         Date.  PwC will not undertake any new engagements for
         the Debtors without first obtaining the approval of the
         Debtors and the Special Committee.

The services to be provided by PwC to the Debtors will not be
unnecessarily duplicative of those provided by any of the
Debtors' professionals.  PwC will coordinate any services
performed at the Debtors' request and any other of the Debtors'
financial advisors, auditors and counsel, as appropriate, to
avoid duplication of effort.

PwC's customary hourly rates are:

        Partners                            $620 - 700
        Directors/Senior Managers            520 - 680
        Managers                             415 - 480
        Senior Associates                    280 - 350
        Associates                           180 - 230
        Administrative Assistants/Analysts    60 - 140

These rates are subject to periodic adjustment for normal rate
increases and promotions.  PwC believes that these rates are in
line with comparable market rates for comparable services.

The Court authorizes PwC's employment nunc pro tunc to July 21,
2002. (Worldcom Bankruptcy News, Issue No. 16; Bankruptcy
Creditors' Service, Inc., 609/392-0900)

DebtTraders reports that Worldcom Inc.'s 7.375% bonds due 2003
(WCOE03USA1) are trading at 26 cents-on-the-dollar.

WORLD HEART: Completes Private Equity Placement
World Heart Corporation (TSX: WHT, OTCBB: WHRTF) has now
completed the final closing of its previously announced private
placement, through Northern Securities Inc., of 712,225 units at
a price of CDN$1.28 per Unit, for gross proceeds of $911,648.
Each Unit comprises one common share, and one warrant to
purchase a common share. Each warrant will be exercisable into
one common share at an exercise price of CDN$1.60 per share for
a period of five years. This closing brings total gross proceeds
from the private placement to $3,000,000.

As previously announced, the Corporation expects to close in the
next few weeks an additional $10 million of term debt financing.
Following the final closing, WorldHeart has 20,313,877 common
shares issued and outstanding.

The common shares, including those underlying the warrants, have
not been registered under the U.S. Securities Act of 1933 and
may not be offered or sold in the United States or to U.S.
persons unless an exemption from such registration is available.

WorldHeart's Novacor(R) LVAS is an electromagnetically driven
pump that provides circulatory support by taking over part or
all of the workload of the left ventricle. Novacor(R) LVAS is
approved in Europe without restrictions for use by heart failure
patients; and in the United States and Canada as a bridge
to heart transplantation. It is approved for use in Japan by
cardiac patients at risk of imminent death from non-reversible
left ventricular failure for which there is no alternative but a
heart transplant.

World Heart Corporation, a global medical device company based
in Ottawa, Ontario and Oakland, California, is currently focused
on the development and commercialization of pulsatile
ventricular assist devices. Its Novacor(R) LVAS (Left
Ventricular Assist System) is well established in the
marketplace and its next-generation technology,
HeartSaverVAD(TM), is a fully implantable assist device intended
for long-term support of patients with end-stage heart failure.

World Heart's September 30, 2002 balance sheet reported a total
shareholders equity deficit of about C$35.4 million.

* Wachovia Corporate Reports Changes Within WICG
Wachovia Corporate and Institutional Trust announced that it has
added new management and enhanced capabilities to Wachovia
Information Consulting Group (WICG). The group provides
comprehensive, cost-effective consultation for claims processing
and similar information management needs of corporations, law
firms and government agencies.

"The goal of Wachovia Information Consulting Group is to provide
accurate, client-based solutions to organizations that must
process populations of claims, transactions or other types of
paper or electronic data," said Linda Delaney, managing director
of Corporate Trust. "We are delighted to add Tony Reid to our
group. His consulting expertise will help us deliver the best
possible service to our clients."

"Wachovia Information Consulting Group is a full-service
operation that not only helps clients plan and implement
processing solutions, but also offers banking and investment
services through other Wachovia units, such as escrow, positive
pay, check clearing and account reconciliation," said Tony Reid,
executive managing director of Wachovia Information Consulting
Group. "I look forward to helping build this unique group in
order to better serve our clients."

WICG services include:

      * Information management consulting
      * Class action settlement administration
      * Mass tort/complex claims management
      * Bankruptcy claims management
      * Data collection and conversion
      * Litigation discovery services
      * Escrow and investment management
      * Call center operations

Before joining Wachovia, Reid was a principal at Navigant
Consulting Inc., where he specialized in claims processing and
operations management consulting. Prior to that, Reid held
management-level positions for several banking institutions.
Reid obtained his B.S. in business from Arizona State University
and has completed graduate level courses in finance at
Washington University in St. Louis, Mo.

Wachovia Corporate and Institutional Trust is part of the
Capital Management Group of Wachovia Bank, N.A., which offers
retirement services, bond administration, custody services,
insurance products and investment management to institutional
clients worldwide. Based in Charlotte, N.C., Wachovia Corporate
Trust has regional locations in 15 states from Boston to

Wachovia Corporation (NYSE: WB), created through the September
1, 2001, merger of First Union and Wachovia, had assets of $334
billion and stockholder's equity of $32 billion at September 30,
2002. Wachovia is a leading provider of financial services to 20
million retail, brokerage and corporate customers throughout the
East Coast and the nation. The company operates full-service
banking offices under the First Union and Wachovia names in 11
East Coast states and Washington, D.C., and offers full-service
brokerage with offices in 49 states and global services through
more than 30 international offices. Online banking and brokerage
products and services are available through

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

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

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

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

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

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

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

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


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

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

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 Go 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 2003.  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 $675 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 ***