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         T R O U B L E D   C O M P A N Y   R E P O R T E R

            Wednesday, January 29, 2003, Vol. 7, No. 20

                           Headlines

21ST CENTURY TECH.: Board OKs Reverse Split and Capital Workout
ADELPHIA BUSINESS: Selling Detroit Market Assets for $2.45 Mill.
ADELPHIA COMMS: Wants Approval of Proposed Niagara Hockey Sale
ADMIRAL CBO: S&P Keeps Watch on 3 Junk-Rated Classes of Notes
AES CORP: Records $2.7B Charges Due to Impacts of Market Changes

AIRNET COMMS: Secures $6 Million Interim Financing Commitment
ALLIANCE PHARMACEUTICAL: Inks Oxygent Workout Pact with Baxter
ALLIED HOLDINGS: Beck Mack Discloses 12.77% Equity Stake
ALPHA TECHNOLOGIES: Red Ink Continues to Flow in Fiscal 2002
AMERICAN COMMERCIAL: Messrs. Hagan & Wolff Resign from Danielson

AMES: Wants Approval to Dispose of Six Unexpired Store Leases
ANALYTICAL SURVEYS: Hires Lori Jones as New Chief Fin'l Officer
AT&T CANADA: Three Brascan Representatives to Resign from Board
BANK OF HAWAII CORP: Reports Improved Financial Results for 2002
BROCADE COMMS: Must Address Market Needs to Ensure Viability

BUDGET GROUP: Court Approves Payment of Avis $1.2MM Break-Up Fee
CALPINE CORP: Signs 100-Megawatt Nevada Power Sales Agreement
CANWEST: Selling Small Market Publications to Osprey Media
CHOICE ONE: Completes Employee Stock Option Exchange Program
CONSECO INC: Finance Debtors Want to Honor Loan Obligations

DELTA AIR LINES: Board of Directors Declares Cash Dividend
DEUTSCHE NICKEL: Fitch Lowers Senior Unsecured Rating to BB-
DIGITAL TELEPORT: CenturyTel Opens with a $38 Million Bid
E*TRADE GROUP: Elects Mitchell H. Caplan Chief Executive Officer
EB2B COMMERCE: Names Robert Priddy & Thom Waye to Company Board

ENCOMPASS SERVICES: UST & Committee Balk at Deloitte Engagement
ENRON CORP: Wants to Implement 2nd Key Employee Retention Plan
EOTT ENERGY: Brings-In H. Keith Kaelber as New EVP and CFO
FLEETWOOD ENTERPRISES: Completes Credit Facility Restructuring
FOAMEX INT'L: William D. Witter Discloses 6.4% Equity Stake

FRONTLINE COMMS: Provo Acquisition Revised to Exclude Kiboga
GENUITY INC: Earns Nod to Hire Skadden Arps as Special Counsel
HUMAN GENOME: Establishes New European Subsidiary in Germany
HYDRO ONE: Ontario Electricity Fin'l Selling All Hydro One Debt
INTEGRATED HEALTH: Competing Bidders Going to Court this Morning

KMART: Fitch Says Store Closings Trigger Few CMBS Downgrades
KMART CORP: Proposes Uniform Store Closing Sales Procedures
LANDSTAR INC: Will Publish Fourth Quarter Results on February 6
LEAR CORP: Working Capital Deficit Stands at $538MM at Dec. 31
LEGACY HOTELS: Dec. 31 Working Capital Deficit Reaches C$130MM

LEVI STRAUSS: Fitch Rates $750MM Secured Bank Facility at 'BB'
LIN HLDGS: S&P Ups Rating to BB- over Fin'l Profile Expectations
LTV CORP: Resolves Conflict over Use of Copperweld's Tax Refund
LUCENT: Teams Up with Iusacell for Mexico's 3-G Mobile Network
LYNX THERAPEUTICS: Initiates 2% Total Workforce Reduction

LYONDELL CHEMICAL: Reports 2003 Capital Expenditure Budget
MATLACK SYSTEMS: Ch. 7 Trustee Taps Palmer Biezup as Co-Counsel
MEMC ELECTRONIC: Narrows Net Capital Deficit to $22MM at Dec. 31
MERRY-GO-ROUND: Chapter 7 Prepares to Make 30% Distribution
METROMEDIA: Takes Action to Keep Network Free of Global Worm

ML CBO VI: S&P Keeps Watch on CCC+ Ser. 1996-C-2 Class A Rating
MORTGAGE CAPITAL: Fitch Hatchets & Affirms Low-B & Junk Ratings
NAT'L CENTURY: Court Appoints Logan as Claims & Noticing Agent
NETIA HOLDINGS: Gets Nod to Re-List on Nasdaq SmallCap Market
NORTHWESTERN CORP: Wins Nod for First Mortgage Bonds Issuance

OWENS CORNING: Wants More Time to File Disclosure Statement
PALADYNE CORP: Independent Auditors Express Going Concern Doubt
PERKINELMER INC: Fourth Quarter 2002 Results Show Improvement
PHOTOCHANNEL NETWORKS: Tinkers with Agreement Terms with Skana
PLAYTEX PRODUCTS: Says Significant Cash Flow Cuts Debt in 2002

POPE & TALBOT: Widens Net Loss to $12 Million in Fourth Quarter
PORTOLA PACKAGING: Says Cash Resources Sufficient to Fund Ops.
PRIVATE BUSINESS: Defaults on Covenants Under Senior Loan Pact
READER'S DIGEST: Reduces Working Capital Deficit to $27 Million
REGUS BUSINESS: Schedules and Statements Should be Filed Today

ROWECOM INC: divine inc Lauds Asset Sale Transaction with EBSCO
RUSSELL CORP: Look for Fourth Quarter 2002 Results by Feb. 13
SEAVIEW VIDEO: Auditors Doubt Ability to Continue Operations
SHEFFIELD PHARMACEUTICALS: Renegotiates $475K of Unsecured Debt
SMTC CORP: Will Host Q4 Results Teleconference on February 13

STAR TELECOMMS: Entry of a Final Decree Deferred to Jan. 9, 2004
STEEL DYNAMICS: Posts Improved 2002 Full-Year Financial Results
SUN MEDIA CORP: Full-Year 2002 Results Show Marked Improvement
SYBRON DENTAL: Reports Strong Fiscal First Quarter Results
THERMOGENESIS CORP: Atlas II et. al. Disclose 6.8% Equity Stake

UBIQUITEL: Issuing New 14% Senior Notes via Private Placement
UNITED AIRLINES: Court Okays Deloitte & Touche as Accountants
UNITED STATIONERS: Will Publish Q4 and 2002 Result Tomorrow
US AIRWAYS: Intends to Pull Plug on Orlando Airport Lease Pact
US MINERAL PRODUCTS: Delaware Court Fixes Feb 20 Claims Bar Date

U.S. STEEL: Extends Sourcing Agreement with Procuri by 3 Years
USG CORP: Will Publish Fourth Quarter 2002 Results on Monday
VALLEY MEDIA: Court Okays Exclusivity Extension through Feb. 12
VENTAS INC: Publishing 2002 Annual Earnings by February 26, 2003
WEBVAN: Closing Webvan Operations and Webvan Bay-Area Cases

WHEELING-PITTSBURGH: Committees Sign-Up Kroll Zolfo as Advisor
WHEREHOUSE: U.S. Trustee Holding Creditors' Meeting on Feb. 28
WORLDCOM INC: Committee Seeks Approval of Kelley Drye Engagement
WORLDCOM INC: Intends to Sell Douglas Lake Ranch in Canada

* Atlas Partners Scouting for $3+ Million Real Estate Deals
* Dewey Ballantine Appoints Seven New Partners and One Counsel

* Meetings, Conferences and Seminars

                           *********

21ST CENTURY TECH.: Board OKs Reverse Split and Capital Workout
---------------------------------------------------------------
Arland D. Dunn, Chairman of the Board and CEO of 21st Century
Technologies, Inc., announced that the Board of Directors has
approved a 100:1 reverse split of common stock, an increase in
the post-split authorized capital of the company, and the
issuance of preferred stock.

"These changes in the capitalization of 21st Century are
necessary so that we may proceed with our plans to make this
company a major factor in the world market for environmental and
security solutions. Our ability to raise capital is greatly
enhanced by this unanimously-approved resolution. This, in turn,
will permit proper capital expenditures to be made which, in
turn, will increase our competitive position. All in all, these
changes represent a great step forward," Mr. Dunn stated.

Authorized capitalization is increased from 200,000,000 shares
to 350,000,000 shares, including 50,000,000 of preferred stock
that may be issued by the Board of Directors without approval of
the shareholders. In addition, the restructure will result in
the issuance of 60,315,173 shares of common stock in redemption
of 60,315,173 of the company's outstanding Preferred Warrants.

The Board of Directors expects to receive written consent from a
majority of the voting interests entitled to vote on the
restructure before the end of February 2002.

As reported in Troubled Company Reporter's December 3, 2002
edition, 21ST Century Technologies, Inc., incurred an operating
loss of $97,442 for the 3 months ending September 30, 2002.
Recapitalization expense of $130,995 increased the loss for the
period to $228,309.  For the nine months ended September 30,
2002, the Company has net income of $33,682 compared to a net
loss of $1,917,536 loss for the same period during the previous
year.  General and administrative expenses of $378,066 have been
sharply reduced for the 9 months ending September 30, 2002
compared with $869,038 for the 9 months ending September 30,
2001. Due to the reduction of mid level and upper management,
compensation costs are likewise reduced from $1,151,338 in 2001
to $314,761 in 2002.

The Company is dependent upon cash on hand and revenues from the
sales of its products.  At present the Company needs cash for
monthly operating expenses in excess of its historic sales
revenues, and will  continue to need additional capital funding
until sales of products increases.  The Company will finance
further growth through both public and private financing,
including equity resources in the event of recapitalization.
Shareholders' interests may be diluted.  If the Company is
unable to raise sufficient funds to satisfy either short term or
long term needs, there would be substantial doubt as to whether
the Company could continue as a going concern on either a
consolidated basis or through continued operation of any
subsidiary.  It might be required to significantly curtail its
operations, significantly alter its business strategy or forego
market opportunities.


ADELPHIA BUSINESS: Selling Detroit Market Assets for $2.45 Mill.
----------------------------------------------------------------
Judy G.Z. Liu, Esq., at Weil Gotshal & Manges LLP, in New York,
relates that Adelphia Business Solutions, Inc., and its debtor-
affiliates, together with their financial advisors, Jefferies &
Co., actively marketed and solicited bids for the various
telecommunications assets and related executory contracts and
unexpired leases associated with the markets that they intend to
close.  These extensive marketing efforts recently resulted in
the approved sale to Gateway Columbus, LLC of assets relating to
certain of the previously closed markets.  Similar marketing
efforts by the ABIZ Debtors have resulted in the execution of a
proposed asset purchase agreement for certain assets related to
the Detroit metropolitan area.

Pursuant to the Agreement, Ms. Liu explains that the ABIZ
Debtors have agreed to sell certain assets, and assume and
assign certain executory contracts and unexpired leases to
Global Visions Communications LLC, for $2,450,000, plus the
assumption of certain contractual liabilities.  The sale is
subject to higher and better offers that may be received as a
result of an auction. Global Visions has already deposited
$245,000 -- i.e., 10% of the Purchase Price -- with the
designated escrow agent pursuant to an escrow agreement executed
by the parties.  The Earnest Money Deposit will be refunded to
Global Visions after the closing of the proposed Sale
Transaction.

During the period commencing on August 5, 2002 and concluding on
January 31, 2003, Ms. Liu explains that Global Visions will pay
to the Debtors $420,000 to compensate them for all commercially
reasonable interim operating expenses relating to the Sale
Assets and the Assumed Liabilities.  The Aggregate Burn Amount
is an additional component of the total consideration.  In the
event the Closing Date occurs prior to January 31, 2003, the
Aggregate Burn Amount will be decreased by $2,794.52 per day,
and if the Closing Date is after January 31, 2003, then the
Aggregate Burn Amount will be increased by $2,794.52 per day
until the Closing occurs.

Ms. Liu insists that the proposed sale of the Assets is well
within the Debtors' sound business judgment.  Several months
ago, the Debtors announced their intention to discontinue
operations in the Detroit Market because it is not part of their
future business plans.

The Debtors believe that any net sale proceeds realized from the
Auction will represent the fair market value for the Sale Assets
and that the Auction is the most appropriate mechanism to
generate maximum value from the closure of the Detroit Market.
Notwithstanding the extensive marketing process that the
Debtors, with the assistance of its financial experts, have
undertaken over the last several months, they believe that an
auction for these assets is in their best interests and will
ensure that the highest and best offer is obtained.

"Other than the liens granted to Beal Bank, SSB, as postpetition
lender under the credit agreement with Beal Bank dated as of
August 7, 2002, and the liens granted to ACOM in respect of the
limited postpetition funding pursuant to the credit agreement
dated as of March 27, 2002, the Debtors are not aware of any
liens relating to the Sale Assets, except for certain purchase
money security interests asserted by Lucent Technologies, Inc.,"
Ms. Liu asserts.  "The Court should authorize the Debtors to
sell the Sale Assets, free and clear of any and all liens,
claims, and encumbrances with any of the same to be transferred
and attached to the net proceeds of the sale, with the same
validity and priority that these liens, claims, and encumbrances
had against the Sale Assets." (Adelphia Bankruptcy News, Issue
No. 27; Bankruptcy Creditors' Service, Inc., 609/392-0900)


ADELPHIA COMMS: Wants Approval of Proposed Niagara Hockey Sale
--------------------------------------------------------------
Adelphia Communications Corp., and its debtor-affiliates seek
the Court's authority to support the proposed sale of certain
assets of Niagara Frontier Hockey, L.P. and its affiliates to
North American Sports L.L.C., or any other party that may submit
a higher or better offer.

Marc Abrams, Esq., at Willkie Farr & Gallagher, in New York,
informs the Court the National Hockey League, on behalf of John
Rigas, individually, and Patmos, Inc., currently intends to
enter into a purchase agreement with North American Sports LLC
for the sale of certain assets and assumption of certain
identified liabilities of Niagara.  Except for the Assumed
Liabilities, the sale of the Purchased Assets is to be free and
clear of all liens.  In consideration for the Purchased Assets,
North America Sports is to offer consideration that is estimated
to yield the ACOM Debtors:

     -- a cash payment between $8,000,000 to $18,000,000;

     -- assumption of the Concession Loan;

     -- warrants to purchase 5% of the equity in the purchasing
        entity for nominal consideration; and

     -- assumption of the Broadcast Term Sheet.

As a condition precedent to entry into the sale of the Purchased
Assets, North American Sports requires certain concessions from
the State of New York and Erie County.

Section 363(b)(1) of the Bankruptcy Code provides that "[t]he
trustee, after notice and hearing, may use, sell or lease, other
than in the ordinary course of business, property of the
estate." In addition, Section 105(a) provides that the Court
"may issue any order, process, or judgment that is necessary or
appropriate to carry out the provisions of [the Bankruptcy
Code]."

Mr. Abrams contends that the Debtors' consent to the sale of the
Purchased Assets has sound business justifications.  In
connection with the sale of the Purchased Assets, the Debtors
estimated they will receive cash payment from North American
Sports between $8,000,000 to $18,000,000 and warrants to
purchase 5% of the equity in the purchasing entity.
Additionally, Niagara will assume the Broadcast Term Sheet.  In
addition to these benefits flowing into the Debtors' estates,
the Debtors will be relieved of the exposure under the
Concession Loan and the Letters of Credit.  By consent to the
sale of the Purchased Assets, the Debtors' recovery from the
assets of the Niagara Debtors will relieve the Debtors of
certain contingent liabilities and the risks associated with the
Niagara Debtors' Chapter 11 cases.

The Debtors do not believe that any creditors hold liens or
security interests in any of their interests in the Purchased
Assets.  Accordingly, the Debtors submit that it is appropriate
to authorize them to consent to the sale of the Purchased Assets
free and clear of liens, interests and encumbrances. (Adelphia
Bankruptcy News, Issue No. 27; Bankruptcy Creditors' Service,
Inc., 609/392-0900)


ADMIRAL CBO: S&P Keeps Watch on 3 Junk-Rated Classes of Notes
-------------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings on the
class A-1, A-2, B-1, and B-2 notes issued by Admiral CBO
(Cayman) Ltd., an arbitrage CBO transaction originated in August
1999, on CreditWatch with negative implications. At the same
time, the rating assigned to the class C notes is affirmed.

The rating on the class A-2 notes was previously lowered in
September 2002; the ratings on class B-1 and B-2 were previously
lowered in April and September 2002; and the rating on the class
C notes was previously lowered in August 2001, April 2002, and
September 2002.

The current CreditWatch placements reflect factors that have
negatively affected the credit enhancement available to support
the notes since the previous rating action in September 2002.
These factors include continuing par erosion of the collateral
pool securing the rated notes, a negative migration in the
overall credit quality of the assets within the collateral pool,
and a decline in the weighted average coupon generated by the
performing assets within the pool.

As a result of asset defaults, the overcollateralization ratios
have deteriorated since the September 2002 rating action.
According to the most recent available monthly report (Jan. 2,
2003), the class A overcollateralization ratio was at 110.43%,
versus the minimum required ratio of 127%, compared to a ratio
of 115.66% at the time of the September 2002 rating action; the
class B overcollateralization ratio was at 92.48%, versus its
required minimum ratio of 111.0%, compared to a ratio 97.32% at
the time of the September 2002 rating action; and, the class C
overcollateralization ratio was at 86.69%, versus its required
minimum ratio of 100.0%, compared to a ratio 91.37% at the time
of the September 2002 rating action.

The credit quality of the collateral pool has deteriorated since
the September 2002 rating action. Including defaulted assets,
32.91% of the assets in the portfolio currently come from
obligors rated 'CCC+' or below by Standard & Poor's, and 17.56%
of the performing assets come from obligors with ratings on
CreditWatch negative. These values compare to 24.17% and 13.48%,
respectively, at the time of the September 2002 rating action.
In addition, Standard & Poor's Trading Model test, a measure of
the amount of credit quality in the current portfolio to support
the ratings assigned to the liabilities, is currently out of
compliance.

The weighted average coupon generated by the assets in the
portfolio has also declined. As of the Jan. 2, 2003 monthly
report, the weighted average coupon was 10.132%, versus the
minimum required of 10.25%, and 10.306% as of the September 2002
rating action.

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

     Ratings Placed on Creditwatch with Negative Implications

                     Admiral CBO (Cayman) Ltd.

                     Rating               Balance (Mil. $)
      Class    To                From    Current   Original
      A-1      AAA/Watch Neg     AAA     153.407   171.500
      A-2      BBB+/Watch Neg    BBB+    47.500    47.500
      B-1      CCC-/Watch Neg    CCC-    14.000    14.000
      B-2      CCC-/Watch Neg    CCC-    25.000    25.000

                          Rating Affirmed

                     Admiral CBO (Cayman) Ltd.

                Class     Rating    Balance (Mil. $)
                C         CC        16.000


AES CORP: Records $2.7B Charges Due to Impacts of Market Changes
----------------------------------------------------------------
The AES Corporation (NYSE:AES) will recognize charges associated
with asset and goodwill impairments during the fourth quarter of
2002 aggregating $2.7 billion, primarily related to its
investments in operating businesses in the UK and Brazil as well
as projects under construction in the US that will be sold or
terminated.

Paul Hanrahan, CEO, stated, "These charges reflect the impacts
of changes in electricity markets and economic conditions in the
UK and US, and weak currency and economic conditions in Brazil
during 2002. These non-cash charges will not impact AES's parent
company liquidity position or violate any covenants in our
corporate financing agreements, or those of AES's other
operating subsidiaries. Following on from the successful
completion of AES's corporate refinancing last month, we
continue to move forward in our efforts to strengthen our
balance sheet and improve the performance of our businesses
around the world."

United Kingdom

The financial distress of certain TXU Europe companies during
the fourth quarter of 2002, which has resulted in the issuance
of an administration order for TXU Europe Energy Trading and TXU
Europe Group plc, led to the termination of the long-term
electricity sales hedging arrangement at AES Drax (a 4,000 MW
coal-fired plant), and a tolling agreement at AES Barry (a 230
MW gas-fired combined cycle plant), both in the UK.

As a result of these terminations, the Company will incur an
asset impairment charge for these two facilities in the amount
of $1.0 billion after income taxes.

Brazil

In conjunction with the Company's annual goodwill impairment
review and as a result of the unfavorable economic and
regulatory environment in Brazil, AES will also incur goodwill
and other asset impairment charges, after income taxes, related
to its investment in Eletropaulo (an electric distribution
company in Sao Paulo) of approximately $706 million, and an
impairment charge of $587 million to reflect the write-down to
fair value of the Company's equity method investment and a
related deferred tax asset in Cemig (an integrated utility in
Minas Gerais).

Other

As part of AES's efforts to strengthen its balance sheet by
restructuring certain businesses, reducing discretionary capital
spending, and selling or terminating the construction or
operations of several businesses, the Company announced
additional charges, primarily in the US.

The most significant of these are related to Mountainview, a
1,182 MW gas-fired business in California and Lake Worth, a 205
MW gas-fired plant under construction in Florida. These actions
result in estimated losses on sale and termination totaling $398
million after income taxes.

2002 Parent Operating Cash Flow and Earnings

AES announced that Parent Operating Cash Flow for 2002 was
$1.095 billion for the year ended December 31, 2002.

Additionally, the Company expects to report income from
recurring operations for 2002 of approximately $0.78, reflecting
the fourth quarter impacts of the loss of the TXU contracts at
two businesses in the UK and continued slower recovery of
electricity demand to pre-rationing levels in Brazil.

Income from recurring operations excludes asset and goodwill
impairments and losses from discontinued operations ($6.06), the
cumulative effect of losses from accounting changes ($0.65),
South America foreign currency transaction losses ($0.66) and
marked to market gains from FAS No. 133 of $0.08.

As a result, the Company currently expects to report a fully
diluted loss per share of approximately $6.51 for 2002. AES also
announced that it will hold a conference call on February 13,
2003 at 9:00 am (eastern) to discuss its plans and expectations
for 2003 as well as to present complete financial results for
2002.

AES is a leading global power company comprised of contract
generation, competitive supply, large utilities and growth
distribution businesses.

The company's generating assets include interests in 176
facilities totaling over 60 gigawatts of capacity, in 33
countries. AES's electricity distribution network sells 108,000
gigawatt hours per year to over 16 million end-use customers.

For more general information visit the Company's Web site at
http://www.aes.com

As reported in Troubled Company Reporter earlier this month,
Standard & Poor's affirmed its 'BB' ratings on The AES Corp.'s
$1.62 billion senior secured bank facility and $350 million
senior secured exchange notes. Approximately $258 million of
exchange notes were issued. The ratings have been changed to
final from preliminary.

"Standard & Poor's views the default risk of the bank facility
and exchange notes as equal to the 'B+' corporate credit rating
of AES, but the two-notch elevation of the ratings on these
instruments reflects Standard & Poor's high degree of confidence
that the collateral package provides enough value for secured
lenders to realize 100% recovery in a default or stress
scenario," said credit analyst Scott Taylor.

AES Corporation's 10.250% bonds due 2006 (AES06USR1) are trading
at about 46 cents-on-the-dollar, DebtTraders reports. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=AES06USR1for
real-time bond pricing.


AIRNET COMMS: Secures $6 Million Interim Financing Commitment
-------------------------------------------------------------
AirNet Communications Corporation (Nasdaq:ANCC) received an
interim debt financing commitment of $6 million. The interim
financing is being provided by TECORE Wireless Systems, an
existing customer, and SCP Private Equity Partners, an existing
investor. The Company also announced that this debt is secured
and is expected to be replaced by long term financing. The debt
will accrue interest at the annual rate of prime plus two
percent.

"For the last few months, we have focused our efforts on
evaluating all of our strategic financial options in an effort
to obtain funding of our business plan. We have narrowed those
available options and are currently negotiating a larger long
term financing transaction with TECORE and SCP," said Glenn
Ehley, President & CEO of AirNet. "Our ultimate goal is to make
this Company profitable while supplying GSM operators with world
class wireless solutions such as our adaptive array Super
CapacityT base station."

"As AirNet's largest customer, [Mon]day we demonstrate TECORE's
commitment to AirNet's long-term success and to their technology
as an attractive solution for GSM network operators around the
world," said Jay Salkini, President & CEO of TECORE. "We hope to
further strengthen our alliance in the very near future."

"As a long time investor in AirNet, we are pleased with the debt
facility concluded [Mon]day and look forward to working on the
larger debt facility in the near future," said James W. Brown,
Chairman of AirNet Communications and a Partner with SCP Private
Equity Partners.

In conjunction with this bridge financing, AirNet also announced
that it was implementing a corporate restructuring with a goal
of saving the Company approximately $2.5M in operational expense
in fiscal year 2003. Approximately 12% of the Company's
employees and contractors will be affected by the restructuring.

The debt securities described herein will not be registered
under the Securities Act of 1933, and will not be available for
sale absent registration or an exemption from registration under
that act.

TECORE Wireless Systems was formed with a singular focus and
mission to serve wireless service providers in rural and
emerging markets across the world. The company mission is to
deliver software based solutions that allow these operators to
adopt newer technologies while still supporting their existing
subscriber base. The company's AirCore(R) system supports the
Mobile Switching Center, Home Location Register, Visitor
Location Register, Authentication Center functionality and
incorporates prepaid services and gateway tandeming capabilities
in a single yet extremely compact unit. The AirCore system is
also the only MSC switching solution for smaller markets to
simultaneously support GSM, CDMA, TDMA and GPRS/IP, as well as
cross-roaming between GSM and ANSI-41 networks.

With over twenty-five systems worldwide, TECORE has also
achieved certification to the prestigious ISO 9001:2000 Quality
Standard. Named one of the "20 Firms for the Next Generation,"
TECORE, Columbia, Maryland, is a global leader in converging
wireless and IP networks and wireless enterprise systems
solutions. For more information, please visit the TECORE Web
site at http://www.tecore.com

SCP Private Equity Partners is a private equity firm focused on
later stage companies in high growth industries, with an
emphasis on technology. SCP generally invests in companies with
commercially proven technologies that need capital to implement
and market their business concepts. SCP targets the information
technology, internet infrastructure, financial services,
wireless communications, life sciences, security and education
sectors. SCP supports its investment portfolio with a rich base
of strategic, operating and financial expertise and an extensive
networking capacity to access capital, recruit management and
facilitate favorable strategic alliances.

AirNet Communications Corporation is a leader in wireless base
stations and other telecommunications equipment that allow
service operators to cost effectively and simultaneously offer
high-speed data and voice services to mobile subscribers.
AirNet's patented broadband, software-defined AdaptaCell(R) base
station solution provides a high capacity base station with a
software upgrade path to high speed data. The Company's Digital
AirSite(R) Backhaul Free(TM) base station carries wireless voice
and data signals back to the wireline network, eliminating the
need for a physical backhaul link, thus reducing operating
costs. AirNet has 69 patents issued or pending. More information
about AirNet may be obtained by visiting the AirNet Web site at
http://www.airnetcom.com

                          *    *    *

           Liquidity and Going Concern Considerations

The Company reported in its Form 10-Q filed on November 14,
2002: "The [Company's] condensed financial statements have been
prepared on a going concern basis, which contemplates the
realization of assets and the satisfaction of liabilities in the
normal course of business; and, as a consequence the financial
statements do not include any adjustments relating to the
recoverability and classification of recorded asset amounts or
the amounts and classifications of liabilities that might be
necessary should the Company be unable to continue as a going
concern. The Company has experienced net operating losses since
inception and as of September 30, 2002 had an accumulated
deficit of $220.8 million. It is probable that cash flow from
operations will be negative for the near term as the Company
continues to experience net losses from operations. At September
30, 2002, the Company's principal source of liquidity was $4.3
million of cash and cash equivalents. Such conditions raise
substantial doubt that the Company will be able to continue as a
going concern without receiving additional funding in the fourth
quarter of 2002. As of November 11, 2002 the Company's cash
balance was $5.2 million and the Company had a revenue backlog
of $4.5 million at that date. There is doubt regarding the
Company's ability to continue operating without additional
funding in the fourth quarter of 2002 because the current
backlog, without new orders, is not adequate to defer the
requirement for additional funding through 2002. The Company
continues to seek both additional customer orders and additional
funding to sustain existing operations and avoid a significant
reduction in size and/or bankruptcy.

"The Company's future results of operations involve a number of
risks and uncertainties. The worldwide market for
telecommunications products such as those sold by the Company
has seen dramatic reductions in demand as compared to the late
1990's and 2000. It is uncertain as to when or whether market
conditions will improve. The Company has been negatively
impacted by this reduction in global demand. Other factors that
could affect the Company's future operating results and cause
actual results to vary from expectations include, but are not
limited to, ability to raise capital, dependence on key
personnel, dependence on a limited number of customers (with one
customer accounting for 52% of the revenue for the first nine
months of 2002), ability to design new products, the erosion of
product prices, the ability to overcome deployment and
installation challenges in developing countries which may
include political and civil risks and risks relating to
environmental conditions, product obsolescence, ability to
generate consistent sales, ability to finance research and
development, government regulation, technological innovations
and acceptance, competition, reliance on certain vendors, and
credit risks. The Company's ultimate ability to continue as a
going concern for a reasonable period of time will depend on its
increasing its revenues and/or reducing its expenses and
securing enough additional funding to enable it to reach
profitability. The Company's historical sales results and its
current backlog do not give the Company sufficient visibility or
predictability to indicate when the required higher sales levels
might be achieved, if at all. The Company believes additional
funding will be required prior to reaching profitability and
several alternatives are possible, including private placement
financing. The Company continues to seek a new financial
advisor; however no assurances can be made that either a
transaction or additional equity or debt financing will be
arranged on terms acceptable to the Company, if at all.

"The Company will have to secure additional funding to maintain
cash levels necessary to sustain its operations through 2002
unless significant new customer orders with sufficient down
payments are secured. It is unlikely that the Company will
achieve profitable operations in the near term and therefore it
is likely that the Company's operations will consume cash in the
foreseeable future. The Company has limited cash resources and
therefore the Company must maintain neutral or minimally
negative cash flows in the near term to continue operating or it
must secure additional funding. There can be no assurances that
the Company will succeed in achieving its goals of securing
additional funding or adequate new orders to sustain the
operations into 2003. Its failure to do so in the near term will
have a material adverse effect on its business, prospects,
financial condition and operating results and the Company's
ability to continue as a going concern. As a consequence, the
Company may be forced to seek protection under the bankruptcy
laws. In that event, it is unclear whether the Company could
successfully reorganize its capital structure and operations, or
whether the Company could realize sufficient value for its
assets to satisfy fully its debts or its liquidation preference
obligations to its preferred stockholders. Accordingly, should
the Company file for bankruptcy, there is no assurance that
there would be any value received by the Company's common
stockholders."


ALLIANCE PHARMACEUTICAL: Inks Oxygent Workout Pact with Baxter
--------------------------------------------------------------
Alliance Pharmaceutical Corp., (OTC Bulletin Board: ALLP) signed
a letter of intent with Baxter Healthcare Corporation under
which Alliance would acquire an option to purchase Baxter's
ownership interest in PFC Therapeutics, LLC, the joint venture
established by Alliance and Baxter in May 2000 to commercialize
Oxygent(TM), an intravascular oxygen carrier, in North America
and Europe. The definitive agreement for the purchase of the
option will provide that Alliance would pay Baxter a royalty on
the sales of Oxygent by PFC Therapeutics, its licensees, or its
assignees following regulatory approval. In addition, Alliance
would have six months to exercise its option to purchase
Baxter's ownership interest in PFC Therapeutics. Under the terms
of the letter of intent, Baxter would retain a right of first
offer to market Oxygent in the U.S. Oxygent (perflubron
emulsion) is intended to avoid the need for donor blood in
elective surgery and other situations.

Alliance also announced that it has retained Burrill & Company,
a life sciences merchant bank, to assist Alliance and PFC
Therapeutics in seeking strategic and financial partners to
provide the resources necessary to conduct pending international
Phase 3 clinical studies with Oxygent. Alliance has obtained
regulatory and clinical site approvals in select European
countries to commence the Phase 3 protocol, which was designed
using data from a successful multinational Phase 3 study with
general surgery patients as reported in the journal
Anesthesiology last month.

"This letter of intent and subsequent definitive agreement
regarding PFC Therapeutics, together with the engagement of
Burrill & Company, should enable Alliance to obtain the
financial support needed to re-initiate the Oxygent clinical
program, which we hope to begin this summer," said Duane J.
Roth, Chairman and CEO of Alliance. "The development of a safe
and effective 'blood substitute' continues to be an important
medical need as availability of donor blood decreases while
surgical and emergency blood usage escalate. An oxygen
therapeutic that can be produced on a large scale and marketed
at a reasonable cost could have a positive impact on health
care. Oxygent has the beneficial attributes of being a sterile
emulsion that does not contain human or animal blood components.
It is universally compatible with all blood types and has a
shelf-life of approximately two years.

"This intended restructuring allows Alliance to work with
Burrill & Company to pursue financing from investors and
strategic partnerships to implement the Phase 3 clinical
program, while preserving the opportunity for Alliance to work
with Baxter in the United States at a later time," Roth noted.

Alliance has been using its perfluorochemical and surfactant
technologies to develop therapeutic and diagnostic products in
addition to Oxygent. On November 25, 2002, Alliance announced
that it had signed a term sheet for Photogen Technologies, Inc.
to acquire Imagent(R) (perflexane lipid microspheres), an
ultrasound contrast agent that was recently approved by the FDA
for marketing in the United States.

In conjunction with the intended restructuring of the Oxygent
agreement and the pending Photogen acquisition, Theodore D. Roth
has resigned his position as Alliance's President and COO, but
will remain a member of the Board of Directors and will serve as
an unpaid consultant to the Company. Current members of the
Board of Directors are Pedro Cuatrecasas, MD, Carroll O.
Johnson, Stephen M. McGrath, Donald E. O'Neill, Jean G. Riess,
Ph.D., Duane J. Roth, and Theodore D. Roth. Helen M. Ranney, MD,
a renowned hematologist, has retired from the Board, but will
continue to advise the Company regarding scientific and medical
matters.

Additional information about Alliance is available on the
Company's Web site at http://www.allp.com

As reported in Troubled Company Reporter in mid-December,
Alliance Pharmaceutical believed it lacked sufficient working
capital to fund operations for the entire fiscal year ending
June 30, 2003 and cannot fund its current obligations.
Therefore, substantial additional capital resources will be
required to fund the ongoing operations related to the Company's
research, development, manufacturing and business development
activities. The Company's current financial condition raises
substantial doubt about its ability to continue as a going
concern.

Management believes there are a number of potential alternatives
available to meet the continuing capital requirements such as
public or private financings or collaborative agreements. In
September, October and November 2002 the Company received a
total of $1.1 million through the issuance of 8% Convertible
Secured Promissory Notes to institutional investors. The Company
is negotiating the issuance of comparable notes of up to $1.9
million to provide additional funding for operations. An
Imagent-related financing is also being negotiated, however
there can be no assurance that either of these financing
arrangements will be consummated in the necessary time frames
needed for continuing operations or on terms favorable to the
Company.


ALLIED HOLDINGS: Beck Mack Discloses 12.77% Equity Stake
--------------------------------------------------------
Beck, Mack & Oliver LLC beneficially own 1,075,750 shares of the
common stock of Allied Holdings Inc., representing 12.77% of the
outstanding common stock of that Company. The stocks are owned
by the investment clients of Beck, Mack & Oliver LLC, and these
clients have the right to receive or the power to direct the
receipt of dividends from, or the proceeds from the sale of,
such securities.  Consequently Beck, Mack & Oliver LLC share
only the power to dispose of, or to direct the disposition of,
the 1,075,750 shares.

As previously reported in Troubled Company Reporter, Standard &
Poor's affirmed its 'B' corporate credit rating on automobile
transporter Allied Holdings Inc., and at the same time, removed
the ratings from CreditWatch. The action reflected Allied
Holdings' announcement that it has refinanced an unrated $230
million revolving credit facility and $40 million in unrated
subordinated debt.

Allied Holdings, based in Decatur, Ga., is the largest North
American motor carrier of new and used automobiles and light
trucks. The company has about $370 million in debt and operating
leases.


ALPHA TECHNOLOGIES: Red Ink Continues to Flow in Fiscal 2002
------------------------------------------------------------
Alpha Technologies Group, Inc., (Nasdaq:ATGI) reported that for
the fiscal year ended October 27, 2002, revenue was $55,574,000
compared to revenue of $67,914,000 for fiscal 2001. The net loss
for the year, before a $15,602,000 goodwill impairment charge, a
$2,097,000 loss on the sale of land and building and a $561,000
loss associated with debt extinguishments and modifications, was
$514,000. The net loss for fiscal 2002, including the pre-tax,
non-recurring items above, was $11,488,000. Net income from
continuing operations in fiscal 2001, excluding $822,000 in
restructuring and other non-recurring charges and losses of
$650,000 associated with debt extinguishment and modifications,
was $990,000.

"Fiscal 2002 was a difficult year with many challenges. Despite
these challenges, Alpha's fiscal 2002 cash flow, as measured by
earnings before interest, taxes, depreciation and amortization
(EBITDA) and before the unusual, non-cash charges mentioned
above, was approximately $5,100,000. We plan to report complete
fourth quarter and fiscal 2002 earnings on February 10, 2003 and
file the 10K on February 11, 2003," said Lawrence Butler,
Chairman and CEO of Alpha Technologies Group, Inc.

                          Conference Call

Alpha has scheduled a conference call at 11:00 AM EST on
February 10, 2003, to discuss its financial results for fiscal
2002. A simultaneous WebCast may be accessed at
http://www.alphatgi.com/pr.html A replay will be available
after 1:00 PM EST at this same internet address. For a telephone
replay, dial (800) 633-8284, reservation #21114383 after 1:00 PM
EST.

Alpha Technologies Group Inc. -- http://www.ALPHAtgi.com-- is
engaged in the manufacture, fabrication and sale of thermal
management products and aluminum extrusions. The Company is one
of the leading manufacturers of thermal management products in
the United States. Thermal management products, principally heat
sinks, dissipate unwanted heat generated by electronic
components. The Company's thermal management products serve the
automotive, telecommunication, industrial controls,
transportation, power supply, factory automation, consumer
electronics, aerospace, defense, microprocessor, and computer
industries. The Company also sells aluminum extrusions to
various industries including the construction, sporting goods
and other leisure activity markets.

                          *     *     *

                 Liquidity and Capital Resources

The Company, in its SEC Form 10-Q filed on September 11, 2002,
reported:

On January 9, 2001, the Company and its subsidiaries, as
guarantors, entered into a Credit Agreement with several banks
and other financial institutions. The Credit Agreement consisted
of a revolving credit facility and a term loan. Borrowings under
the Credit Agreement are secured by a first lien on and the
assignment of all of the Company's assets. Under the Credit
Agreement, the Company must meet certain covenants. During the
fiscal year ended October 28, 2001 and during the three months
ended January 27, 2002, the Company did not meet certain
financial covenants. As a result, all outstanding loan balances
under the Credit Agreement were classified as current
liabilities at October 28, 2001.

On January 28, 2002, the Lenders amended the Credit Agreement to
revise certain financial covenants and waive certain events of
non-compliance at October 28, 2001 and January 27, 2002. Under
this first amendment to the Credit Agreement, interest on the
revolving credit facility and the term note increased by rates
ranging from .5% to .75% depending on the amount of financial
leverage. Interest is now payable monthly on the revolver and
the portion of the term loan that is not covered by the swap
agreement. Interest on the portion of the term loan that is
covered by the swap agreement is payable quarterly. In addition,
availability under the revolving credit facility was reduced
from $15 million to $5 million, the expiration date for the
revolving credit facility was amended from January 9, 2006 to
June 30, 2003, and modifications were made to the remaining
payment schedule on the term loan.

On March 12, 2002, the Company and its Lenders entered into a
second amendment to the Credit Agreement, which amended certain
financial and other covenants. It also required the Company to
make a $5 million principal payment on June 28, 2002 which the
Company contemplated making from the sale or refinancing of the
Company's Pelham, New Hampshire facility. Fees paid to the
Lenders for the January 28, 2002 and March 12, 2002 amendments
to the Credit Agreement, including the fair value of warrants to
purchase the Company's common stock, totaled approximately
$600,000 and were expensed during the second quarter.

On June 28, 2002, the Company did not make the $5 million
principal payment as a result of its inability to complete a
sale and leaseback transaction by that date. On July 24, 2002,
the Company and its Lenders entered into a third amendment to
the Credit Agreement, by which the $5.0 million payment due on
June 28, 2002 was delayed until September 30, 2002; the Company
was allowed to satisfy the difference between the $5.0 million
obligation and the proceeds from the sale and leaseback
transaction with additional borrowings from its revolving credit
facility; the date by which warrants granted pursuant to the
Second Amended Credit Agreement must be registered, was delayed
to February 4, 2003; loan covenants were adjusted to reflect the
impact on EBITDA of the Company's most recent financial
projections as well as the sale and leaseback transaction. Fees
paid to the Lenders for the third amendment to the Credit
Agreement totaled approximately $66,000 and are being amortized
over the remaining life of the loan.

Under the Amended Credit Agreement, the revolving credit
facility accrues interest on outstanding borrowings at LIBOR
plus 3.5% (5.32% on July 28, 2002) and expires on June 30,2003.
There is also an unused line fee equal to .75% per annum. The
Company may borrow up to the lesser of $5 million or 60% of
eligible accounts receivable ($4.9 million at July 28, 2002). As
of July 28, 2002, $2.2 million has been drawn and is outstanding
on the revolving credit facility.

A portion of the outstanding term loan ($14.5 million on
July 28, 2002) is covered by an interest rate swap (the "hedged
loan"). The hedged loan accrues interest at a fixed rate of
8.47%. The balance of the term loan not covered by the swap,
$12.9 million on July 28, 2002, consists of two notes which
accrue interest at the relevant LIBOR rate plus 3.5% (5.88% on
$3.7 million and 5.36% on $9.2 million on July 28, 2002).

The Amended Credit Agreement contains financial and other
covenants with which the Company must comply. These covenants
include limitations on the amount of financial leverage the
Company can incur, minimum fixed charge coverage, limits on
capital spending, required minimal amounts of net worth, and
required levels of earnings before interest, taxes, depreciation
and amortization (EBITDA). The maximum financial leverage
ratio, which is calculated by dividing funded debt by EBITDA,
must not exceed 5:00:1, 3:90:1, 3.45:1, and 3.15:1 for the third
quarter of fiscal 2002, full year of fiscal 2002, first quarter
of fiscal 2003 and second quarter of fiscal 2003 respectively.
The fixed charge coverage ratio, which is calculated by dividing
fixed charges by EBITDA, must not exceed 1.15:1, 1.15:1, 1.10:1
and 1.05:1 for the third quarter of fiscal 2002, full year of
fiscal 2002, first quarter of fiscal 2003 and second quarter of
fiscal 2003 respectively. Capital spending is limited to
$500,000, $700,000, and $1.0 million for fiscal years 2002, 2003
and thereafter, respectively. Minimum Net Worth must be no less
than $33,050,000 plus 75% of future Net Income plus 100% of the
Net Proceeds of future Equity Offerings. This amount is reduced
by Permitted Stock Repurchases and charges related to the
issuance of warranty agreements in connection with the Loan
Documents. The "Minimum Net Worth" covenant excludes goodwill
write off in accordance with the provisions of FAS No.142 up to
a maximum of $20 million. EBITDA must be no less than $4.6
million and $6.1 million on an annual basis at the end of the
third quarter and full year of fiscal 2002, respectively. There
is no minimum annual EBITDA requirement beyond fiscal year 2002.
The Company is currently in compliance with all of the financial
covenants under the Credit Agreement.

On July 28, 2002, cash balance totaled approximately $492,000 as
compared to $2.7 million on October 28, 2001. For the nine
months ended July 28, 2002, $1.5 million was provided by
operating activities and $3.3 million was used by financing
activities to pay the quarterly installment of its term loan.
Deferred tax assets which is classified as "Other Assets, net "
in the Balance Sheet increased by $5.9 million due primarily to
the tax affect of the goodwill impairment charge. Capital
equipment purchases during the first nine months of fiscal 2002
were $369,000 compared to $1.1 million during the same period
last year. The Company's capital equipment purchases are
restricted by its credit agreement with its Lenders and can not
exceed $500,000 during fiscal 2002. The Company believes that
its current equipment in place is sufficient to meet current and
future business demand. The equipment is not subject to rapid
obsolescence and has the capability of handling significant
increased volume.

Working capital on July 28, 2002 was $4.0 million as compared to
a negative balance of $18.1 million on October 28, 2001. Working
capital on October 28, 2001, excluding $25.9 million of long-
term debt classified as a current liability due to the Company's
non-compliance with certain financial covenants, totaled
approximately $7.7 million. A change in the loan amortization
schedule as a result of amendments to the bank Credit Agreement
which increased the current maturities of long term debt was the
primary contributor to the decrease in working capital from $7.7
million to $4.0 million. Other factors included decreases in
cash and accounts receivable, which were partially offset by
increases in inventories and decreases in accrued compensation
and other accrued liabilities. The Company believes that its
available cash and future cash flow from operations will be
sufficient to fund operations over the next twelve months.
However, the Company will need to utilize borrowings under its
revolving credit facility to make a portion of the $5 million
principal payment on its term loan which is due on September 30,
2002. The revolving credit facility expires on June 30, 2003. It
is likely that the Company will need to extend or replace this
revolving credit agreement in order to have the funds necessary
to pay off any remaining outstanding balance on the revolver and
to fund future growth.

The Company has orally accepted an offer of $4.75 million for a
sale and leaseback transaction of its Pelham, New Hampshire
facility which will provide net cash proceeds of approximately
$4.5 million from a group which includes a director of the
Company and two other private investors. The director has a 50%
ownership interest in this group. This transaction includes the
issuance of 250,000 warrants of Company stock to the buyers at
the market price of the Company's common stock on the date the
transaction closes. The parties are currently in the final
stages of documenting the transaction. The Company understands
that the Purchasers are in the process of completing their
final documents to finance the acquisition. The Agreement
includes a 15-year lease for the building. The lease, which will
be accounted for as an operating lease in accordance with SFAS
No. 13, "Accounting for Leases", requires minimum annual rental
payments of approximately $629,000 subject to annual adjustments
ranging from 2% to 2.5%. The book value of the land, buildings
and improvements is approximately $6.3 million. Selling costs
are anticipated to be approximately $260,000. The value of the
250,000 warrants of Company stock using the Black-Scholes
valuation method is expected to be approximately $208,000. The
expected loss on the sale of the property will be approximately
$2.0 million. The Company expects to complete the sale and
leaseback transaction before September 30, 2002. If it does not,
it will be in default under the Credit Agreement and its Lenders
will have the right, among other things to declare the entire
amount to be due and owing.


AMERICAN COMMERCIAL: Messrs. Hagan & Wolff Resign from Danielson
----------------------------------------------------------------
Michael C. Hagan has resigned as a member of the Board of
Directors of Danielson Holding Corporation and James J. Wolff
has resigned as the Chief Financial Officer of Danielson Holding
Corporation in order to allow themselves to continue to fully
focus their efforts on the financial restructuring of American
Commercial Lines LLC.  Both resignations were effective as of
January 22, 2003.  Messrs. Hagan and Wolff are continuing in
their roles as Chief Executive Officer and Chief Financial
Officer, respectively, of American Commercial Lines and each
will remain as Members of the American Commercial Lines Board of
Managers.

American Commercial Lines LLC is an integrated marine
transportation and service company. ACL provides barge
transportation and ancillary services throughout the inland
United States and Gulf Intracoastal Waterway Systems, which
include the Mississippi, Ohio and Illinois Rivers and their
tributaries and the Intracoastal canals that parallel the Gulf
Coast.  In addition, ACL is the leading provider of barge
transportation services of the Orinoco River in Venezuela and
the Parana/Paraguay River System serving Argentina, Brazil,
Paraguay, Uruguay and Bolivia.

As reported in Troubled Company Reporter's Tuesday Edition,
American Commercial Lines received letters from JPMorgan Chase
Bank, the agent under its senior credit facility, and Bank One,
N.A., the provider of its receivables facility, noticing a
cross-default related to ACL's failure to pay interest on its
notes and reserving their respective rights under the credit
agreement and receivables facility. ACL is actively engaged in
discussions with its lenders regarding a possible restructuring.


AMES: Wants Approval to Dispose of Six Unexpired Store Leases
-------------------------------------------------------------
After announcing their plan to close down their operations, Ames
Department Stores, Inc., and its debtor-affiliates engaged in
negotiations with certain landlords regarding the consensual
disposition of unexpired leases and any of the Debtors'
obligations under the leases.  The discussions culminated in
offers or agreements providing for:

    (i) the rejection -- or assumption and assignment if a
        landlord requests -- of the Lease;

   (ii) the landlord's waiver of claims against the Debtors
        regarding the Lease and the Store; and

  (iii) the landlord's agreement to compensate the Debtors in
        consideration for the rejection of the Lease.

Thus, the Debtors seek the Court's authority to consummate their
transactions with the landlords of six unexpired leases, absent
higher or better offers:

   Store No.   Location               Landlord
   ---------   --------               --------
       72      Pennsburg, PA          Pennsburg Associates
      601      Athens, OH             Chesapeake Realty Limited
      510      Baltimore, MD          Martin Financial Associates
     2141      East Hartford, CT      Loren J. Andreo
     2155      North Dartmouth, MA    PR North Dartmouth, LLC
     2157      South Attleboro, MA    Amalgamated Financial Group

Neil Berger, Esq., at Togut, Segal & Segal LLP, in New York,
relates that Debtors have concluded that the Agreements are in
the best interests of their estates.  The Debtors and their
advisors have determined, among other things, that the offers
they received for the Leases represent the best overall written
proposals to date for each of the Leases.  The overall value
that the Debtors will obtain, in cash for each lease, plus the
Landlords' waivers of their claims, also represents a
significant recovery for the benefit of the estates.

Mr. Berger also notes that the Debtors' decision to dispose of
the Leases pursuant to Agreements is consistent with the ongoing
the liquidation of their assets as part of the Wind-Down.  The
liens and security interests in Kimco's favor pursuant to the
Kimco Agreement will attach to the proceeds of the Leases.
Moreover, Kimco has no objection to the transactions
contemplated by the Agreements.

The relevant terms of the Agreements include:

   (a) Each of the Leases will be deemed rejected, or assumed
       and assigned to a third party designee of the Landlords,
       on the date the Debtors surrender and deliver possession
       of the store to the Landlords;

   (b) On the Termination Date:

         (i) the Landlords will be deemed to have waived any and
             all scheduled, filed or asserted claims they may
             have against the Debtors under or relating to a
             particular Lease or the Store:

             Landlord               Amount    Nature of Claim
             --------               ------    ---------------
             Pennsburg Associates   $10,277   prepetition
                                        278   postpetition

             Chesapeake Realty       18,194   December rent

             Martin Financial        22,591   prepetition
                                     29,900   postpetition

             Loren J. Andreo        110,165   prepetition
                                     21,869   December rent

             PR North Dartmouth      84,856   prepetition
                                     26,115   postpetition

             Amalgamated             92,795   prepetition rent
                                              CAM charges, Real
                                              Estate Taxes
                                     18,748   postpetition CAM
                                     80,223   December base rent

        (ii) the Debtors and Pennsburg Associates also agree that
             Pennsburg will receive a $10,000 credit against the
             Purchase Price for Store No. 72 on account of clean-
             up and repair costs at the store premises.
             Pennsburg will retain a contingent general unsecured
             environmental indemnification claim;

       (iii) Chesapeake agrees to waive administrative claims,
             other than for December pro rata rent, for any
             additional postpetition rent and other charges due
             and owing under the Store No. 601 Lease.  Chesapeake
             also agrees to waive any and all claims resulting
             from the termination of the Lease;

        (iv) the Debtors and Martin Financial separately agree
             that the prepetition cure amounts with respect to
             Store No. 501 will only be waived if the Lease is
             assigned to Martin Financial's designee.  Martin
             Financial also insists that the postpetition cure
             amount will be paid by adjusting the Purchase Price;

         (v) the Landlords reserve all claims that they may have,
             independent of the Agreements, for indemnification
             against the Debtors to the extent of any claim for
             damages asserted against the Landlords by any third
             party relating to the Debtors' occupancy and
             operation of the Store;

   (c) The Debtors will release the Landlords from any claims
       related to the Store.  However, the Debtors reserve all
       claims that they have for indemnification against the
       Landlords to the extent of any claim for damages asserted
       against them by any third party related to their occupancy
       and operation of the Store and any claim for damages
       asserted against them by any third party subsequent to the
       surrender of the Store; and

   (d) Subject to the Debtors' surrender of the Store, the
       Landlords will pay a purchase price in immediately
       available funds as consideration of the Lease rejection:

                     Store No.    Purchase Price
                     ---------    --------------
                         72             $190,000
                        601               25,000
                        510               50,000
                       2141              630,000
                       2155            1,750,000
                       2157            1,100,000

       * The Purchase Price for the Store No. 601 Lease is
         subject to adjustment on account of December pro rata
         rent due as of Termination Date.

                            Auction

If another party submits a higher or better offer for one of the
Leases, the Debtors propose to utilize the uniform bidding and
auction procedures established by the Court.  Mr. Berger advises
that any succeeding offers from other interested parties must
exceed the Landlords' offer by at least $100,000.  During the
Auction, the Debtors will impose a $50,000 minimum as subsequent
bid increment.  The Pennsburg, Chesapeake and Baltimore Store
Leases, however, will follow a $10,000 minimum initial overbid
and at least $5,000 as bid increment.  The East Hartford Lease
will follow a $50,000 Initial Bid Increment and at least $10,000
as subsequent bid increment.

All bids made at the Auction will remain open and irrevocable
until 11 days after the Sale Hearing and the second best bid, as
determined by the Debtors, will remain open and irrevocable
until a closing on the Transaction.  Mr. Berger relates the
second highest bid may be accepted and consummated subject to an
appropriate Court order if the bid selected at the Auction and
approved by the Court is not consummated at the Closing.

                          *     *     *

After reviewing the merits of the case, Judge Gerber authorizes
the Debtors to consummate the transactions with respect to these
stores:

(1) Store No. 2141

     The Debtors will assign the East Hartford Lease to LMA/USA
     Limited Partnership, as Loren J. Andreo's designee pursuant
     to the Agreement.

(2) Store No. 2155

     No other offers matched or bested PR North Dartmouth's, and
     accordingly, the Debtors reject the lease pursuant to the
     Agreement.

(3) Store No. 2157

     Amalgamated Financial's designee, Burlington Coat Factory
     Warehouse of South Attleboro, Inc., emerged as the
     successful bidder after offering $2,500,000 for the store
     lease at the auction.  Therefore, the Debtors will assume
     and assign the lease to Burlington.

     Judge Gerber rules that Burlington will not be responsible
     for any claims or obligations arising under the Lease before
     the Closing under the Agreement.  Judge Gerber instructs the
     Debtors to pay $234,556 to Amalgamated plus $726 per day
     starting January 1, 2003 until the Closing Date. (AMES
     Bankruptcy News, Issue No. 32; Bankruptcy Creditors'
     Service, Inc., 609/392-0900)


ANALYTICAL SURVEYS: Hires Lori Jones as New Chief Fin'l Officer
---------------------------------------------------------------
Analytical Surveys, Inc. (Nasdaq: ANLT), a provider of
customized data conversion and digital mapping services for the
geographic information systems and related spatial data markets,
announced today the appointment of Lori A. Jones to the position
of Chief Financial Officer.  Ms. Jones' appointment was
effective on January 20, 2003.

Ms. Jones has 18 years experience in financial management with
both privately held and publicly traded companies, including
high growth and start up ventures.  She has an extensive
background in financial reporting, public and private equity
placements, SEC reporting and strategic planning.  In her new
post, Ms. Jones will oversee financial and administrative
functions as ASI continues to provide quality services and
expand its product and service offerings to new and existing
customers.

A long-term San Antonio resident and active participant in the
local business community, Ms. Jones is a graduate of Howard
Payne University and holds an MBA in finance from the University
of Texas at San Antonio.  Ms. Jones also is a Certified Public
Accountant.

In announcing the appointment, Norman Rokosh, ASI President and
CEO, stated, "Ms. Jones joins ASI at a very exciting time for
the Company.  While we are clearly focused on delivering quality
in the present, we also are planning our future with great
anticipation.  We welcome Lori to our team at this important
time.  Her addition will us help us fulfill our current mission
and move toward new strategic targets.  She is a seasoned
financial professional and a well-respected local personality
who will make a major contribution to ASI as we pursue
significant growth opportunities in our core markets."

"ASI is a dynamic organization that is in the midst of pursuing
a great growth opportunity," Ms. Jones said.  "I'm looking
forward to applying my knowledge and experience to help ASI
continue to grow its position as a premier provider of data
management services in the GIS marketplace."

Analytical Surveys Inc., provides technology-enabled solutions
and expert services for geospatial data management, including
data capture and conversion, planning, implementation,
distribution strategies and maintenance services.  Through its
affiliates, ASI has played a leading role in the geospatial
industry for more than 40 years.  The Company is dedicated to
providing utilities and government with responsive, proactive
solutions that maximize the value of information and technology
assets.  As of January 1, 2003, ASI is headquartered in San
Antonio, Texas and maintains facilities in Indianapolis, Indiana
and Waukesha, Wisconsin.  For more information, visit
http://www.anlt.com

                         *    *    *

In its SEC Form 10-K filed on December 19, 2002, the Company
reported: "The [Company's] financial statements have been
prepared on a going concern basis, which contemplates the
realization of assets and the satisfaction of liabilities in the
normal course of business. During the fiscal years of 2000
through 2002, the Company experienced significant operating
losses with corresponding reductions in working capital and net
worth, excluding the impact of debt forgiveness, and does not
currently have any external financing in place to support
operating cash flow requirements. The Company's revenues and
backlog have also decreased substantially during the same
period. The Company's senior secured convertible note also has
certain immediate call provisions that are outside the Company's
control, which if triggered and exercised, would make it
difficult for the Company to meet these debt payments. These
factors among others raise substantial doubt about the Company's
ability to continue as a going concern.

"To address the potential going concern issue, management
implemented financial and operational restructuring plans
designed to improve operating efficiencies, reduce and eliminate
cash losses and position the Company for profitable operations.
Financial steps included restructuring the Company's bank debt
through the issuance of preferred stock and convertible debt,
subsequent collection of the federal income tax refund and sale
of non-core assets. Operational steps included the consolidation
of production services to two solution centers, reduction of
corporate and non-core spending activities, outsourcing certain
components of projects and deploying a new sales and marketing
team.

"The financial statements do not include any adjustments
relating to the recoverability of assets and the classifications
of liabilities that might be necessary should the Company be
unable to continue as a going concern. However, management
believes that its turnaround efforts, if successful, will
improve operations and generate sufficient cash to meet its
obligations in a timely manner.

"In the absence of a line of credit and limitations on securing
additional debt, the Company depends on internal cash flow to
sustain operations. Internal cash flow is significantly affected
by customer contract terms and progress achieved on projects.
Fluctuations in internal cash flow are reflected in three
contract-related accounts: accounts receivable; revenues in
excess of billings; and billings in excess of revenues. Under
the percentage of completion method of accounting:

      - "Accounts receivable" is created when an amount becomes
due from a customer, which typically occurs when an event
specified in the contract triggers a billing.

      - "Revenues in excess of billings" occur when the Company
has performed under a contract even though a billing event has
not been triggered.

      - "Billings in excess of revenues" occur when the Company
receives an advance or deposit against work yet to be performed.

"These accounts, which represent a significant investment by ASI
in its business, affect the Company's cash flow as projects are
signed, performed, billed and collected. At September 30, 2002,
the Company had multiple contracts with three customers that
represented 72% (43%, 17% and 12%, respectively) of the total
balance of net accounts receivable and revenue in excess of
billings. At September 30, 2001, these customers represented 44%
(18%, 14% and 12%, respectively) of the total balance of net
accounts receivable and revenue in excess of billings. Billing
terms are negotiated in a competitive environment and, as stated
above, are based on reaching project milestones. The Company
anticipates that sufficient billing milestones will be achieved
during fiscal 2003 such that revenue in excess of billings for
these customer contracts will begin to decline.

"The Company's operating activities provided positive cash flow
of $2.3 million in fiscal 2002, $0.3 million in fiscal 2001 and
breakeven in fiscal 2000. Contract-related accounts described in
the previous paragraph declined $6.0 million, $8.7 million and
$15.0 million in fiscal 2002, 2001 and 2000, respectively. A
significant portion of this decline in 2000 resulted from
contract cost-to-complete adjustments, which reduced revenues in
excess of billing without providing cash flow. Accounts payable
and accrued expenses decreased $2.0 million in fiscal 2002, $3.5
million in fiscal 2001 and increased $1.8 million in fiscal
2000. The decrease in fiscal 2001 reflects the Company's reduced
size of operations, in part due to the sale of its Colorado
Springs, Colorado office.

"Cash provided by investing activities principally consisted of
proceeds from sales of assets, offset by the purchases of
equipment and leasehold improvements. In fiscal year 2001, the
Company enhanced cash flow by $8.6 million from the sale of
assets, primarily from the sale of Colorado assets. The Company
purchased equipment and leasehold improvements totaling $0.4
million, $0.4 million and $1.7 million in 2002, 2001 and 2000,
respectively.

"Cash used by financing activities for fiscal years 2002, 2001
and 2000 was $0.5 million, $10.1 million and $2.1 million,
respectively. Financing activities consisted primarily of net
borrowings and payments under lines of credit for working
capital purposes and net borrowings and payments of long-term
debt used in operations and the purchase of equipment and
leasehold improvements. The Company reduced debt by $6.0 million
with proceeds from the sale of its Colorado Springs, Colorado
office in fiscal 2001."


AT&T CANADA: Three Brascan Representatives to Resign from Board
---------------------------------------------------------------
AT&T Canada Inc., Canada's largest competitor to the incumbent
telephone companies, announced a change in the composition of
its board of directors.

The three representatives of Brascan Financial Corporation -
Jeffrey Blidner, Robert Harding and George Myhal - have resigned
their seats on the basis that Brascan will not hold an equity
interest in AT&T Canada upon implementation of AT&T Canada's
restructuring plan filed on January 22, 2003.

Purdy Crawford, AT&T Canada's Chairman of the Board, said, "On
behalf of the Board, I would like to thank these three directors
for their contributions to our Board. The fact that we are
poised to emerge from our restructuring as an independent and a
financially stronger company is a credit to the Board. These
three individuals representing Brascan have been most
constructive throughout our restructuring process."

The vacancies created by today's announcement will not be
filled. The remaining six directors will continue to serve until
a new board assumes office upon implementation of the
restructuring plan. The new board's nominees, identified in the
plan itself, include some of Canada's top business and telecom
leaders: Purdy Crawford, John McLennan, Gerald E. Beasley,
William A. Etherington, Deryk I. King, Ian D. Mansfield, Ian M.
McKinnon, Jane Mowat and Daniel F. Sullivan.

With the recent filing of AT&T Canada's restructuring plan and
the establishment of new commercial agreements with AT&T Corp.,
the Company expects to emerge from CCAA proceedings at the end
of March, 2003.

AT&T Canada is the country's largest national competitive
broadband business services provider and competitive local
exchange carrier, and a leader in Internet and E-Business
Solutions. With over 18,700 route kilometers of local and long
haul broadband fiber optic network, world class data, Internet,
web hosting and e-business enabling capabilities, AT&T Canada
provides a full range of integrated communications products and
services to help Canadian businesses communicate locally,
nationally and globally. Visit AT&T Canada's Web site at
http://www.attcanada.comfor more information about the Company.

AT&T Canada Inc.'s 7.650% bonds due 2006 (ATTC06CAR1) are
trading at about 18 cents-on-the-dollar, DebtTraders says. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=ATTC06CAR1
for real-time bond pricing.


BANK OF HAWAII CORP: Reports Improved Financial Results for 2002
----------------------------------------------------------------
Bank of Hawaii Corporation (NYSE:BOH) reported diluted earnings
per share for 2002 of $1.70, compared to diluted earnings per
share of $1.46 in 2001. Net income for the year was $121.2
million, up $3.4 million from $117.8 million reported in the
previous year. The return on average assets in 2002 was 1.22
percent, up 31.2 percent compared to 0.93 percent in 2001. The
return on average equity was 10.24 percent, an increase of 16.9
percent from 8.76 percent in 2001.

"We are pleased with several aspects of Bank of Hawaii's results
for 2002," said Michael E. O'Neill, Chairman and CEO. "Our
people are much more focused on our key markets in Hawaii, Guam
and American Samoa. Our credit quality has improved, our margin
has strengthened, our share repurchase program has returned $530
million to shareholders and our technology conversion program is
on schedule. Importantly, our customer and employee satisfaction
measures have strengthened and our banking businesses are poised
for growth in 2003. We remain optimistic that we can continue to
improve our efficiency and benefit from an improved economy this
year."

Diluted earnings per share for the fourth quarter of 2002 were
$0.44, up $0.10 or 29.4 percent from $0.34 per diluted share for
the same period last year. Net income in the fourth quarter was
$28.9 million, up 9.9 percent from net income of $26.3 million
in the fourth quarter last year. The presence of non-core items
and the effect of business divestitures in 2001 continue to have
a significant impact on the comparability with prior year
results. Included in the fourth quarter of 2002 were charges of
$7.0 million related to the information technology systems
replacement project and $0.4 million in net restructuring
expenses from the closure of four branches in the West Pacific
that were partially offset by a reversal of reserves related to
the divestiture program. Earnings for the fourth quarter of 2001
included gains on divestitures and restructuring items that
increased net income by $6.4 million, or $0.08 per diluted
share. Supplemental information has been provided in Table 11
that summarizes the continuing business operating results for
the last eight quarters.

                     Financial Highlights

Net interest income for the fourth quarter of 2002 on a fully
taxable equivalent basis was $90.2 million, down $2.0 million
from the third quarter of 2002 primarily due to decreased
interest rates. Net interest income was down $16.0 million from
the fourth quarter of 2001 primarily due to lower average
earning assets related to the divestitures and the managed
reduction of loans in an effort to reduce credit risk.

The net interest margin was 4.05 percent for the fourth quarter
of 2002, a 2 basis point increase from 4.03 percent in the
previous quarter and a 12 basis point increase from 3.93 percent
in the same quarter last year. The net interest margin
improvement was largely due to lengthening the maturities of
some short-term investments, reductions in short-term borrowings
and time deposits, as well as debt repurchases, which lowered
the Company's cost of funds.

Given continued improvements in Bank of Hawaii Corporation's
credit quality, the Company did not recognize a provision for
loan and lease losses during the fourth quarter of 2002. This
resulted in a $11.6 million reduction in the allowance for loan
and lease losses, which equaled the amount of net charge-offs
for the quarter. The Company did not recognize a provision for
loan and lease losses during the third quarter of 2002. The
provision for loan and lease losses was $14.5 million in the
fourth quarter of 2001.

Non-interest income was $51.1 million for the quarter, an
increase of $3.7 million, or 7.8 percent, from non-interest
income of $47.4 million in the third quarter of 2002. Non-
interest income of $79.0 million for the fourth quarter of 2001
included $28.7 million in net gains on sales of the Company's
South Pacific operations that were partially offset by write-
downs on venture investments. Excluding these items, non-
interest income increased $0.9 million, or 1.7 percent from the
same quarter last year.

Non-interest expense for the fourth quarter of 2002 was $97.5
million, including the previously mentioned $7.4 million in
information technology system replacement and restructuring
costs. Excluding these items, non-interest expense increased by
$4.5 million, or 5.3 percent, to $90.0 million compared to $85.5
million in the previous quarter. The increase was largely the
result of severance expenses, damage from Typhoon Pongsona in
Guam and professional fees accrued at year-end. Non-interest
expense of $140.0 million for the fourth quarter of 2001
included restructuring and other related costs of $18.5 million.
Excluding these items, non-interest expenses declined $31.5
million, or 25.9 percent, from the same quarter last year and
were largely due to savings associated with the divested
businesses.

The efficiency ratio was 65.0 percent for the full year of 2002.
Excluding the systems replacement project costs and non-
recurring items, the efficiency ratio was 62.2 percent compared
to the continuing business efficiency ratio of 63.4 percent last
year. The Company anticipates that the efficiency ratio
excluding systems replacement costs will be approximately 58.0
percent by the end of 2003.

The effective tax rate of 35.4 percent for 2002 is a decrease
from the prior year as the effective tax rate in 2001 reflected
the impact of divestitures and foreign taxes. The unusually low
effective tax rate for the fourth quarter of 2001 was due to the
impact of foreign tax and other credits recognized in the
quarter as well as adjustments in the effective tax rate for the
full year of 2001.

                          Asset Quality

Bank of Hawaii Corporation's credit quality improved during the
fourth quarter of 2002 as measured by reductions in non-
performing assets and continued improvement in the Company's
internal credit risk ratings.

Non-performing assets were $54.4 million at the end of the
fourth quarter of 2002, a decrease of $8.9 million, or 14.1
percent, from non-performing assets of $63.3 million at the end
of the third quarter. Compared to the same period last year,
non-performing assets declined $25.3 million, or 31.7 percent.
At December 31, 2002 the ratio of non-performing assets to total
loans plus foreclosed assets and non-performing loans held for
sale was 1.01 percent, down from 1.20 percent at September 30,
2002 and down from 1.40 percent at December 31, 2001.

Non-accrual loans were $45.0 million at December 31, 2002, a
reduction of $0.7 million from $45.7 million at September 30,
2002 and down $15.8 million, or 26.0 percent, from $60.8 million
at December 31, 2001. Non-accrual loans as a percentage of total
loans were 0.84 percent at December 31, 2002, down from 0.87
percent at the end of the previous quarter and down from 1.07
percent at December 31, 2001.

Net charge-offs for the fourth quarter of 2002 were $11.6
million, or 0.88 percent, of total average loans (annualized).
Charge-offs of $15.0 million, which includes an $8.8 million
write-off of an aircraft lease, were partially offset by
recoveries of $3.4 million. Net charge-offs of $27.7 million for
the full year of 2002 were 0.51 percent of total average loans
(annualized), a significant improvement from net charge-offs of
$121.4 million, or 1.57 percent in the prior year.

The allowance for loan and lease losses was $142.9 million at
December 31, 2002, a decrease of $11.6 million compared with
September 30, 2002 and a decrease of $16.1 million from December
31, 2001. The ratio of the allowance for loan and lease losses
to total loans was 2.67 percent at December 31, 2002 compared
with 2.94 percent at the end of the third quarter and 2.81
percent at the end of the same quarter last year.

The concentration of credit exposure to selected industries and
the amount of the Company's syndicated exposure are summarized
in Table 6.

                     Other Financial Highlights

Total assets were $9.5 billion at the end of December 31, 2002,
down from $10.6 billion at December 31, 2001 and down slightly
from $9.7 billion at the end of September 30, 2002. The most
significant decrease compared to the previous year was
commercial loans as the Company made strategic risk reductions
in the portfolio. Compared to September 30, 2002, total assets
decreased $186 million from $9.7 billion largely due to
reductions in short-term investments as excess liquidity was
utilized for share repurchase and debt reduction during the
quarter.

Total deposits at December 31, 2002 were $6.9 billion, up $242
million from December 31, 2001 and up $293 million from the end
of September 30, 2002. Quarterly deposit levels are summarized
in Table 9. Strong growth in demand and savings deposits more
than offset managed decreases in time and foreign deposits. The
Company continues to manage down higher cost funds, including
time deposits, purchased funds and long-term debt.

During the fourth quarter of 2002, Bank of Hawaii Corporation
repurchased 3.3 million shares of common stock at a total cost
of $94.1 million. The average cost per share was $28.90 during
the quarter. At December 31, 2002, the Company had repurchased a
total of 20.1 million shares under its previously announced
share repurchase programs. Through December 31, 2002, a total of
$527.9 million had been returned to the shareholder at an
average cost of $26.21 per share. An additional program to
repurchase up to $230 million of common stock was announced on
December 13, 2002. This new authorization, combined with the
Company's previously announced authorizations of $570 million,
brings the total repurchase authority to $800 million. Through
January 24, 2003, the Company repurchased an additional 1.4
million shares of common stock at a cost of $30.29 per share.
Remaining buyback authority was $230.4 million at January 24,
2003.

The Company's capital and liquidity remains exceptionally
strong. At December 31, 2002 the Tier 1 leverage ratio was 10.34
percent compared to 11.20 percent at December 31, 2001 and 11.07
percent at September 30, 2002.

The Company's Board of Directors declared a quarterly cash
dividend of $0.19 per share on the Company's outstanding shares.
The dividend will be payable on March 14, 2003 to shareholders
of record at the close of business on February 24, 2003.

         Information Technology Systems Replacement Project

Bank of Hawaii Corporation signed an agreement with Metavante
Corporation in July 2002 to serve as the Company's primary
technology systems provider. The seven-year outsourcing
arrangement is on schedule to be operational in the third
quarter of 2003 and is expected to provide annual cost savings
of over $17 million compared to current expense levels. In
connection with this decision, the Company estimates that it
will recognize transition charges of approximately $35 million
over the five-quarter conversion period that began in the third
quarter of 2002. During the fourth quarter, $7.0 million in
transition costs were incurred, bringing the total cost to $13.6
million in 2002. System conversion costs are estimated to be
approximately $7.7 million in the first quarter of 2003.
Additional details on this project may be found in Table 10.

                      Economic Outlook

The current macroeconomic forecast for Hawaii in 2003 is real
economic growth of 3.1 percent after modest inflation of 1.8
percent with 2.0 percent job growth, part of which is still
recovery from 9/11. Tourism growth for 2003 is forecast at 4.7
percent for domestic travel markets and at 4.8 percent for
international travelers. Construction and real estate investment
will continue to drive the economy forward in 2003, despite
lingering geopolitical risks. For more economic information,
visit the Company's Web site http://www.boh.com/econ/

                          Earnings Outlook

Bank of Hawaii Corporation updates its earnings guidance to $131
million in net income for the full year of 2003. Net income is
expected to increase in the second half of 2003 after completion
of the systems conversion project. Based on current conditions,
the Company does not expect to record a provision for loan
losses in 2003. However, the actual amount of the provision for
loan losses will depend on determinations of credit risk that
will be made near the end of each quarter. Earnings per share
and return on equity projections continue to be dependent upon
the terms and timing of share repurchases.

Bank of Hawaii Corporation is a regional financial services
company serving businesses, consumers and governments in Hawaii,
American Samoa and the West Pacific. The Company's principal
subsidiary, Bank of Hawaii, was founded in 1897 and is the
largest independent financial institution in Hawaii. For more
information about Bank of Hawaii Corporation, see the Company's
Web site at http://www.boh.com

                          *     *     *

As previously reported, Fitch Ratings upgraded the Individual
rating of Bank of Hawaii Corporation, formerly Pacific Century
Financial Corporation, to 'B/C' from 'C' and revised its Rating
Outlook to Positive from Stable. The upgrade of the Individual
rating and the change in its Rating Outlook largely reflects the
progress the company has made in reducing the risk profile of
the company and the prospects for improved operating
performance.

Fitch's ratings also take into account the company having a
solid Hawaiian banking franchise, which provides them with a
stable core funding base and a healthy liquidity position.
Further, the ratings incorporate BOH's strong capital and
reserve positions, which temper concerns regarding the number of
problem or potential problem credits that remain in the
portfolio.


BROCADE COMMS: Must Address Market Needs to Ensure Viability
------------------------------------------------------------
Brocade Communications Systems, Inc., develops, markets, sells,
and supports data storage networking products and services. It
provides a line of storage networking products that enables
companies to implement highly available, scalable, manageable,
and secure environments for data storage applications. Companies
use its products to connect servers and storage through a
storage area network.  Its products are installed around the
world at companies, institutions, and other entities of all
sizes, ranging from large enterprises to small businesses. Its
products and services are marketed, sold, and supported
worldwide to end-users through its distribution partners,
including original equipment manufacturers, value-added
distributors, systems integrators, and value-added resellers.

In recent quarters, unfavorable economic conditions and reduced
global IT spending rates have adversely affected Brocade's
operating results and led to a decline in its growth rates
compared to historical trends. The Company has indicated that it
is unable to predict when IT spending rates will return to
historical levels, if at all. If there are further reductions in
either domestic or international IT spending rates, or if IT
spending rates do not return to historical levels, the Company's
revenues, operating results and financial condition may be
adversely affected.

The Company's future success depends upon its ability to address
the rapidly changing needs of its customers by developing and
introducing high-quality, cost-effective products and product
enhancements on a timely basis, and by keeping pace with
technological developments and emerging industry standards. In
the second quarter of fiscal 2002, it introduced the SilkWorm
12000 Core Fabric Switch targeted at expanding its existing
market and gaining market share in the high-end enterprise-class
market. The Company expects to launch new products and product
enhancements during the next year that will further expand the
market opportunity for the SilkWorm 12000 Core Fabric Switch. It
expects that its future revenue growth will be dependent on the
success of the SilkWorm 12000 Core Fabric Switch, the success of
other members of its current line of products, new product
enhancements, and the continued development of new products. In
the past Brocade has experienced delays in product development;
such delays could occur in the future. In addition, if unable to
achieve market acceptance of its new products, its business and
results of operations could be harmed.

Brocade's ability to successfully implement the Company business
plan, develop and offer products, and manage its business in a
rapidly evolving market requires a comprehensive and effective
planning and management process. Management continues to change
the scope of operations domestically and internationally,
including managing headcount appropriately. In addition, the
expected acquisition of Rhapsody and its integration into
Brocade could present additional management challenges. Changes
in business, headcount, organizational structure and
relationships with customers and other third parties has placed,
and will continue to place, a significant strain on Brocade's
management systems and resources. Failure to continue to improve
upon operational, managerial, and financial controls, reporting
systems, and procedures, and failure to continue to train and
manage its work force worldwide, could seriously harm Brocade's
business and financial results.

Brocade Communications' 2.000% bonds due 2007 are presently
trading at about 75 cents-on-the-dollar.


BUDGET GROUP: Court Approves Payment of Avis $1.2MM Break-Up Fee
----------------------------------------------------------------
If Budget Group Inc., and its debtor-affiliates close the sale
for the EMEA Assets with a bidder other than Avis Europe plc,
Avis Europe will be entitled to a Termination Amount equal to:

     (i) $500,000, plus

    (ii) a $750,000 documented expense reimbursement in
         connection with a termination by the Debtors to accept a
         Competing Proposal.

This Termination Amount will have a superpriority administrative
expense status under the Bankruptcy Code and will be
collateralized by the assets pledged to collateralize the EMEA
Financing Facility.

Joseph A. Malfitano, Esq., at Young Conaway Stargatt & Taylor
LLP, asserts that ample support exists for the approval of the
Termination Amount as contemplated in the Purchase Agreement in
light of:

     A. the benefit to the Debtors' estate realized by having the
        benefit of Avis Europe's extensive due diligence efforts
        and a fully negotiated Purchase Agreement;

     B. the stalking horse risk Avis Europe faces if a Successful
        Bidder materializes; and

     C. the size of the Termination Amount as compared to the
        transaction.

Mr. Malfitano believes that the Termination Amount is fair and
reasonable in view of the amount of intensive analysis, due
diligence investigation and negotiation undertaken by the
Purchaser in particular, given the multi-jurisdictional
complexities in the transaction and the collateral benefit this
work product provides to the estates in the form of a negotiated
asset purchase agreement and a market-tested valuation of the
Purchased Assets.  The Debtors believe that other persons
interested in the Debtors' business, none of whom have been
willing to enter into a definitive agreement for the purchase of
the Purchased Assets, will be more inclined to present a higher
offer than they otherwise would, now that they have obtained, at
no cost to themselves, the benefit of Avis Europe's extensive
efforts.

                            *     *     *

Judge Walrath rules that the termination amount will be equal to
a termination fee and liquidated damages amounting to $250,000,
plus actual, reasonable and documented expenses of up to
$1,000,000; provided further, that prior to receiving any
expenses, Avis Europe will provide to the U.S. Trustee and the
Committee copies of all invoices comprising the expenses and the
U.S. Trustee and the Committee will have 10 days from receipt of
invoices to object to the reasonableness of the expenses.
(Budget Group Bankruptcy News, Issue No. 14; Bankruptcy
Creditors' Service, Inc., 609/392-0900)

Budget Group Inc.'s 9.125% bonds due 2006 (BD06USR1) are trading
at about 23 cents-on-the-dollar, DebtTraders reports. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=BD06USR1for
real-time bond pricing.


CALPINE CORP: Signs 100-Megawatt Nevada Power Sales Agreement
-------------------------------------------------------------
Calpine Corporation (NYSE: CPN), the nation's leading
independent power company, has entered into a three-year power
purchase agreement with Nevada Power Company, a subsidiary of
Sierra Pacific Resources (NYSE: SRP).  The arrangement calls for
the delivery of 100 megawatts of on-peak and 50 megawatts of
off-peak power.  Calpine expects the contract to generate annual
revenue of approximately $43 million.

The agreement has been executed with Nevada Power and is pending
final approval by the Public Utilities Commission of Nevada.
The contract is scheduled for PUCN review this March and power
deliveries are expected to begin June 1, 2003.

"Calpine is pleased to be expanding our valued business
relationship with Nevada Power through this contract," said
Calpine's Curt Hildebrand, Vice President, Sales & Marketing.
"We view Nevada as an important power market for Calpine, and
this agreement further highlights the value of our South Point
Energy Center.  Its location and superior efficiency provide
Calpine a distinct advantage in securing contracts to serve one
of the region's fastest growing power markets."

Energy delivered under the Nevada Power contract will primarily
originate from Calpine's South Point Energy Center located at
the Fort Mohave Indian Reservation near Bullhead City, Ariz. at
the California/Arizona border. Online since June 2001, South
Point represents the first merchant power plant to begin
operation in Arizona and the first facility of its kind to be
developed on Native American tribal lands.  The facility was
built specifically to serve the Tri-state wholesale power market
comprised of Western Arizona, Southern Nevada and Southern
California.

Comparable to the majority of Calpine's energy centers, South
Point uses a combined-cycle design that enables it to generate
electricity 40 percent more efficiently than traditional natural
gas-fired facilities, and the project incorporates the best
available emissions control technology resulting in up to 90
percent fewer emissions compared to older-technology power
plants.

Based in San Jose, Calif., Calpine Corporation is a leading
independent power company that is dedicated to providing
wholesale and industrial customers with clean, efficient,
natural gas-fired power generation.  It generates and markets
power through plants it develops, owns, leases and operates in
23 states in the United States, three provinces in Canada and in
the United Kingdom.  Calpine is also the world's largest
producer of renewable geothermal energy, and it owns
approximately one trillion cubic feet equivalent of proved
natural gas reserves in Canada and the United States.

The company was founded in 1984 and is publicly traded on the
New York Stock Exchange under the symbol CPN.  For more
information about Calpine, visit its Web site at
http://www.calpine.com

DebtTraders reports that Calpine Corp.'s 10.50% bonds due 2006
(CPN06USR2) are trading at about 53 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=CPN06USR2for
real-time bond pricing.


CANWEST: Selling Small Market Publications to Osprey Media
----------------------------------------------------------
CanWest Global Communications Corp., entered into an agreement
with Osprey Media Holdings Inc., for the sale of CanWest's small
market daily and weekly newspapers and related assets in
Southern Ontario for a cash price of $193.5 million. The
transaction is expected to close in mid-February, with Osprey
already having received all necessary regulatory approvals.
Proceeds from the sale will be used to reduce CanWest's debt.

Properties being sold to Osprey include four daily newspapers --
St. Catharines Standard, Brantford Expositor, Niagara Falls
Review and The Welland Tribune -- and a number of weekly
newspapers, shoppers and other publications. In aggregate, these
properties contributed EBITDA of approximately $22 million to
CanWest's financial results for the fiscal year ended August 31,
2002.

As with the newspapers sold to GTC last summer, Osprey's
newspapers will continue to contribute to, and receive news and
editorial content from, CanWest News Service and Infomart, and
to be represented in national advertising sales by CanWest Media
Sales.

Commenting on the transaction, Leonard Asper, CanWest's
President and Chief Executive Officer, said, "This sale to
Osprey is consistent with our previously announced intention to
divest non-strategic assets. The price, in our view, reflects
fair value for these publications. While valuable in their own
right, these properties are not central to the Company's
strategy, which is focused upon creating and exploiting a multi-
media presence in Canada's larger urban markets, but they do
represent a strategic acquisition to Osprey."

CanWest will continue to consider divestiture of other of its
non-strategic assets, provided of course, that we can realize
full and fair value on their disposition, as we have with this
and past transactions" he added.

Mr. Asper noted that over the past two years, CanWest has sold
several television stations as well as daily and weekly
newspapers and other publications in Atlantic Canada and
Saskatchewan, in the process, and including this transaction,
raising more than $700 million, all of which has been, or in
this case will be, applied to the reduction of the Company's
debt.

Mr. Asper also noted that completion of the sale will further
improve the Company's debt leverage ratios. On a pro forma
basis, assuming completion of this transaction had occurred on
November 30, 2002, CanWest's ratio of Total Debt to EBITDA for
purposes of its credit facilities would have at that date been
4.94, compared to a maximum covenant ratio of 5.75, and an
improvement to the ratio of 5.10 previously reported. That
covenant will remain at 5.75 until February 2004.

CanWest Global Communications Corp. (NYSE: CWG; TSE: CGS.S and
CGS.A; http://www.canwestglobal.com)is an international media
company. CanWest, now Canada's largest publisher of daily
newspapers, owns, operates and/or holds substantial interests in
newspapers, conventional television, out-of-home advertising,
specialty cable channels and radio networks in Canada, New
Zealand, Australia, Ireland and the United Kingdom. The
Company's program production and distribution division and
interactive media division operate in several countries
throughout the world.

                            Backgrounder

                     Sale of Assets to Osprey

The following publications have been included in this sale
transaction:

  Daily Newspapers:

     St. Catharines Standard
     Brantford Expositor
     Niagara Falls Review
     The Welland Tribune

  Weekly Newspapers:

     Dunnville Chronicle
     New Hamburg Independent
     Midweek (Brantford)
     Weekender (Brantford)
     Weekend Update (Niagara Falls)
     The Tribune Extra (Welland)
     Pelham News (Welland)
     Cambridge Times
     Guelph Tribune
     Waterloo Chronicle
     Ancaster News
     Dundas Star News
     Hamilton News
     Stoney Creek News
     Weekend Edition
     Flamborough Review Weekend Edition
     Niagara Advance
     The Times
     Lincoln Post Express
     West Lincoln Review
     Grimsby Independent

  Other Publications:

     Real Estate News and Business Guide
     New Homes News
     The Shopping Times
     Niagara Shopping News
     Regional Shopping News
     St. Catharines Shopping News
     Forever Young
     TV Times (Brantford)
     Homes (Brantford)
     Life Matters (Brantford)
     In Port (Niagara)

                           *   *   *

As previously reported, Standard & Poor's lowered its long-term
corporate credit and senior secured debt ratings on
multiplatform media company CanWest Media Inc., to 'B+' from
'BB-'. At the same time, the ratings on the company's senior
subordinated notes were lowered to 'B-' from 'B'. The outlook is
now stable.

The downgrade reflects CanWest Media's continued relatively weak
financial profile, which was not in line with the 'BB' rating
category.


CHOICE ONE: Completes Employee Stock Option Exchange Program
------------------------------------------------------------
Choice One Communications Inc. (OTC Bulletin Board: CWON), an
Integrated Communications Provider offering facilities-based
voice and data telecommunications services, web hosting, design
and development to small and medium-sized businesses, announced
that the tender offer under its employee stock option exchange
program expired at midnight (Eastern) on January 21, 2003.

The outstanding current options properly tendered for exchange
by eligible employees have been accepted. Pursuant to the offer,
4,119,524 current options, or approximately 92% of the eligible
current options, were tendered for exchange by eligible
employees. On January 21, 2003, in accordance with the terms and
conditions set forth in the tender offer, Choice One granted to
those eligible employees new options to purchase 2,582,986
shares of common stock with an exercise price of $0.26 per
share.

As described in the offer, filed with the Securities and
Exchange Commission on December 19, 2002, as amended, options
granted before January 2, 2002, other than certain performance-
based options granted on January 1, 2002, were eligible for the
stock option exchange program. Options issued under the
company's Director Stock Incentive Plan were excluded from the
stock option exchange program.

Headquartered in Rochester, New York, Choice One Communications
Inc., (OTC Bulletin Board: CWON) is a leading integrated
communications services provider offering voice and data
services including Internet and DSL solutions, and web hosting
and design, primarily to small and medium-sized businesses in
second and third-tier markets.

Choice One, with a total shareholders' equity deficit of about
$452 million at Sept. 30, 2002, currently offers services in 29
markets across 12 Northeast and Midwest states. At September 30,
2002, the company had nearly 500,000 lines in service and more
than 100,000 accounts. The company's annualized revenue run rate
is approximately $300 million, based on third quarter 2002.

For further information about Choice One, visit its Web site at
http://www.choiceonecom.com


CONSECO INC: Finance Debtors Want to Honor Loan Obligations
-----------------------------------------------------------
The Interim Agreement reached between the Conseco Finance
Debtors and U.S. Bank covers 66 MH securitized trusts.  However,
the CFC Debtors act as Servicer for an additional 78 trusts not
subject to the Settlement Motion.

Accordingly, the CFC Debtors ask Judge Doyle for permission to
honor existing servicing obligations for the 78 trusts.

The CFC Debtors originate and service a large amount of loans.
For example, the Debtors are responsible for the movement of
over $40,000,000 in funds from customers to trust recipients on
a daily basis.  However, the CFC Debtors do not have access to
the secondary markets to securitize their loans anymore.

CFC wants to honor prepetition consumer loan commitments and
securitize loans in the ordinary course of business.

When there is a payment delinquency, CFC is required to advance
the discrepancy from its own funds.  These payments are either
reimbursed from available cash flow or subsequent collections on
the delinquent loan, usually several months later.
Additionally, CFC is required to make repossession advances,
which includes foreclosure-related charges like judicial
proceedings, costs to preserve foreclosed property, and
management/liquidation of foreclosed property.  On average, the
CFC Debtors make $15,000,000 to $20,000,000 per month in
repossession advances.

The CFC Debtors need the Court's permission to fulfill their
obligations on the 78 trusts.  They also need permission to make
delinquency advances and repossession advances.

To provide additional liquidity, CFC has assigned its
reimbursement rights for these advances to a special purpose
entity, which has securitized the reimbursement rights.  CFC has
completed a similar transaction for repossession advances.  CFC
needs permission to continue this program.

Moreover, the CFC Debtors, in their loan origination operation,
approve applications several days or weeks before the loans are
funded.  This amounts to $150,000,000 to $200,000,000 in a given
month.  On the Petition Date, there were several loans in the
CFC Debtors' pipeline that had been approved prepetition but not
yet funded.  Thus, the CFC Debtors seek the Court's authority to
fund the Pipeline Loans. (Conseco Bankruptcy News, Issue No. 5;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


DELTA AIR LINES: Board of Directors Declares Cash Dividend
----------------------------------------------------------
Delta Air Lines' (NYSE: DAL) Board of Directors declared a cash
dividend of two and one-half cents per common share at its
regular meeting in Atlanta.

The dividend is payable on March 1, 2003, to shareowners of
record on Feb. 5, 2003.

Delta's Board of Directors also set April 25, 2003, as the date
for the Annual Meeting of Shareowners.  The meeting will be held
at 10:30 a.m. EDT at The Plaza Hotel, Fifth Avenue at Central
Park South, New York, New York.

The record date for determining shareowners entitled to notice
of, and to vote at, the annual meeting will be the close of
business on Feb. 28, 2003.

Delta Air Lines, the world's second largest airline in terms of
passengers carried and the leading U.S. carrier across the
Atlantic, offers 5,826 flights each day to 437 destinations in
78 countries on Delta, Delta Express, Delta Shuttle, Delta
Connection and Delta's worldwide partners. Delta is a founding
member of SkyTeam, a global airline alliance that provides
customers with extensive worldwide destinations, flights and
services. For more information, please go to
http://www.delta.com

Delta Air Lines' 10.375% bonds due 2022 are currently trading at
about 69 cents-on-the-dollar.


DEUTSCHE NICKEL: Fitch Lowers Senior Unsecured Rating to BB-
------------------------------------------------------------
Fitch Ratings, the international rating agency, has lowered the
Senior Unsecured rating of Deutsche Nickel Technology Group to
'BB-'. DNT represents the largest part of Deutsche Nickel AG.
Ratings remain on Rating Watch Negative, pending the outstanding
test of financial covenants for FY02.

The rating action reflects the slower than expected recovery of
profitability levels following a downturn started in FY01. Fitch
expects that non-ferrous metals businesses, where DN supplies to
manufacturers of electronic consumer goods (e.g. PCs, TV- and
Hi-fi equipment) will remain exposed to competition in mature
market segments. The division saw margin pressure and
restructuring expenses to optimize capacity utilization and to
reduce over-exposure to the production of low-margin
commodities.

Lower than expected volumes at EuroCoin after the peak demand
experienced during the initial stage of the Euro's introduction,
accompanied by some pricing pressure executed from the state-
owned off-takers, have also led to a worse performance in
Payment Systems. However, Fitch acknowledges the potential for
gradual EBIT improvements in the medium term, which will be
supported by the focus on higher value-added products, if
overall sales levels improve.

Amid the weaker profitability, FY01 EBITDA-based credit
protection measures have deteriorated - Net Debt/EBITDA was 3.6x
(FY00: 3.4x) and EBITDA/Net Interest cover fell back to 3.8x,
close to FY98 levels. The negative development of the leverage
is largely driven by the tailing-off of the EBITDA contribution
in Non-ferrous Metals. FY01 cash flow generation was mainly
supported by the reduction in working capital from a decrease in
finished goods in stock. Fitch expects that FY02 EBITDA
generation will not exceed FY01 levels and that measures
undertaken to improve profitability are expected to show
material impact only from FY03 onwards.

During FY01, VDN Vereinigte Deutsche Nickel-Werke AG merged with
its immediate parent, Langbein Pfanhauser Werke AG, an
industrial group, which has refocused on metalworking and
interior decorations. On 21 December 2001, DNAG and VDN entered
into a profit and loss absorption agreement, which requires VDN
to cover any losses at the DNAG level. This agreement replaces
individual shareholder resolutions for future upstream dividend
payments. VDN continues to have access to DNAG's cash flow only
via inter-company loans, which remain subject to DNAG board
approval.

Fitch notes that the DNT bond is traded in narrow markets
characterised by small trading volumes and that current market
conditions leave limited room to access the capital markets.
Fitch notes that financial bond covenants are met by a narrow
margin. VDN has not guaranteed any of DNAG's Senior Unsecured
creditors with the exception of the outstanding EUR120 million
7.125% Euro debenture maturing 2006. In Fitch's view this
guarantee provides an improvement in the bondholders' positions.

With respect to the lower FY02 EBITDA levels expected, the
Rating Watch Negative will remain in place until the test of the
covenants has been executed during the course of the FY02 audit.
It is characteristic for companies of this size that the audit
is not fully completed before May 2003. Fitch stresses that
covenant levels included in the bond documentation do not
reflect a company in financial distress, although non-compliance
may cause a refinancing risk. Fitch aims to resolve the Rating
Watch upon confirmation that the FY02 covenants have been met.


DIGITAL TELEPORT: CenturyTel Opens with a $38 Million Bid
---------------------------------------------------------
Digital Teleport Inc. has asked a federal Bankruptcy Court for
approval to conduct an auction for the sale of its regional
fiber optic business to the highest bidder and disclosed it has
received a definitive $38 million bid from local exchange
telephone company CenturyTel Inc. (NYSE:CTL).

Digital Teleport also asked the U.S. Bankruptcy Court for the
Eastern District of Missouri in St. Louis for approval of
bidding procedures and to set a Feb. 10 auction date with a
potential sale to be approved by the court on Feb. 18.  Bids
from any other qualified buyers are due Feb. 7.  Digital
Teleport provides wholesale fiber optic transport and Ethernet
services in secondary and tertiary markets in the Midwest to
national and regional telecommunications carriers.

"Through a competitive bidding process, Digital Teleport is
attempting to achieve the highest return for our investors and
the greatest recovery for our creditors," said Paul Pierron,
president and CEO of Digital Teleport. "Over the past year, our
management team has worked diligently to increase the value of
our business, and has succeeded in spite of the current telecom
environment and the challenges of bankruptcy. We've grown our
year-over-year bandwidth revenue by more than 43 percent and we
are generating positive operating income and cash flow."

CenturyTel, the eighth largest local exchange telephone company
in the United States based on phone lines, bid $38 million in
cash for Digital Teleport's fiber optic network and business.
The agreement negotiated with CenturyTel provides for upward
adjustments to the purchase price, including certain capital
expenditures prior to the closing of the sale.

As a so-called "stalking horse bidder," CenturyTel is entitled
to submit higher bids in the auction and will receive a break-up
fee of approximately 2 percent if its original bid is not
ultimately accepted.

"While Digital Teleport reserves the right to pursue a
standalone reorganization plan, it appears that such a plan
would provide less immediate liquidity to creditors than would a
sale of the business," Pierron said. The committee of unsecured
creditors supports the sale to CenturyTel.

Digital Teleport filed voluntary Chapter 11 petitions last
Dec. 31, indicating plans to exit the national long-haul
business and focus on operating its traditional core fiber optic
network in the Midwest. Judge Barry S. Schermer, who presides
over the case, previously approved various contract settlements
with other long-haul providers clearing the way for an asset
sale of the company or a standalone plan or reorganization for
emerging from Chapter 11.

Digital Teleport provides wholesale fiber optic transport
services in secondary and tertiary Midwest markets to national
and regional telecommunications carriers. The company's network
spans 5,700 route miles across Arkansas, Illinois, Iowa, Kansas,
Missouri, Nebraska, Oklahoma and Tennessee. Digital Teleport
also provides fiber optic communications services to enterprise
customers and government agencies in St. Louis' premier office
buildings. The company's Web site is at
http://www.digitalteleport.comand its telephone number is
1-314-880-1000.

Digital Teleport, Inc., DTI Holdings, Inc., and Digital Teleport
of Virginia, Inc., filed for chapter 11 protection on
December 31, 2001, in the U.S. Bankruptcy Court for the Eastern
District of Missouri in St. Louis (Bankr. Case No. 01-54371).
Robert E. Richards, Esq., at Sonnenschein, Nath & Rosenthal in
Chicago, represents the Debtors.


E*TRADE GROUP: Elects Mitchell H. Caplan Chief Executive Officer
----------------------------------------------------------------
The Board of Directors of E*TRADE Group, Inc., (NYSE: ET)
announced that Christos M. Cotsakos has resigned as Chairman,
Chief Executive Officer and director of the company. The Board
has unanimously elected Mitchell H. Caplan Chief Executive
Officer, effective immediately. The Board also announced that
it has appointed George Hayter, E*TRADE Group's Lead Director,
non-executive Chairman. Mr. Caplan, who was also elected a
director of E*TRADE Group, will continue as President.

"I am extremely proud of what we have accomplished over the past
seven years and it is with great confidence that I hand the
success and momentum to Mitch Caplan to further build on the
core strengths of E*TRADE," said Mr. Cotsakos. "With a
tremendous management team behind him, there is no doubt that
Mitch will lead E*TRADE to become one of the leading diversified
financial services institutions. I'd like to thank the Board and
our associates for making these past seven years an
extraordinary experience."

Mr. Hayter said, "E*TRADE is fortunate to have a very deep and
experienced management bench which will ensure a smooth
transition. We have the utmost confidence in Mitch and the
entire senior management team. Under this team's leadership, we
believe that E*TRADE is well positioned to achieve its full
growth potential and build shareholder value.

"Although we regret to see Christos move on, I fully support his
decision. During his tenure, Christos led E*TRADE from a small,
private, 'deep-discount' brokerage to a profitable, publicly-
traded company with annual revenues of $1.3 billion and for that
we owe him a great deal," said Mr. Hayter.

Mr. Caplan said, "E*TRADE today is an operationally strong,
technologically advanced, financially sound industry leader in
online financial products and services. Our strategy going
forward will be to aggressively capitalize on our diversified
business model and prudently seek new growth opportunities in
the marketplace.

"On behalf of our entire management team, we want our associates
and customers to know that we are fully committed to delivering
superior financial products and services that are the most value
based in the industry," Mr. Caplan concluded.

Mr. Caplan, 45, joined the company in 2000 after E*TRADE's
acquisition of Telebank and Telebanc Financial Corporation
(subsequently renamed E*TRADE Bank). In 2002, Mr. Caplan was
named President and Chief Operating Officer of E*TRADE Group and
has been responsible for the successful execution of the
company's operations.

In addition to his role as President and Chief Operating Officer
of E*TRADE, Mr. Caplan has also served as Chief Financial
Products Officer, Managing Director of E*TRADE North America,
and Chairman of the Board and Chief Executive Officer of E*TRADE
Bank. From 1990 to 2000, Mr. Caplan was involved in the
formation and strategic development of Telebank and Telebanc
Financial Corporation, a publicly traded company, as Vice
Chairman, President and Chief Executive Officer. From 1985 to
1990, he was an associate at the law firm of Shearman &
Sterling. He holds a J.D. and M.B.A. from Emory University and
an A.B. in History from Brandeis University.

Mr. Hayter has been an independent director of E*TRADE Group,
Inc. since December 1995 and was named lead director in 2002.
From 1976 to 1990, he directed the electronic trading and
information services of the London Stock Exchange during a
period of unprecedented development. He played a leading role in
the transformation of London's exchange into Europe's first
electronic stock market at the Big Bang of 1986. His role also
included the regulation of the market, its orderly operation and
its supporting systems. Since 1990, he has held a number of non-
executive directorships and chairmanships of publicly traded
companies. Mr. Hayter received an M.A. in Physics from Queens'
College, Cambridge, England.

E*TRADE Financial brings together personalized and fully
integrated financial services including investing, banking,
lending, planning and advice. Delivered through a multi-
touchpoint platform, the products, services, content and
information at E*TRADE Financial are available to customer
households through E*TRADE Financial Centers, Zones, ATMs and
branded Web sites throughout the world. Securities products and
services are offered by E*TRADE Securities, LLC (member
NASD/SIPC), bank products and services are offered by E*TRADE
Bank (member FDIC), mortgages are offered by E*TRADE Mortgage
Corporation, and E*TRADE Financial Advisor is a service of
E*TRADE Advisory Services, Inc., an investment adviser
registered with the SEC.

E*Trade Group's 6.000% bonds due 2007 are currently trading at
about 74 cents-on-the-dollar.


EB2B COMMERCE: Names Robert Priddy & Thom Waye to Company Board
---------------------------------------------------------------
eB2B Commerce, Inc., (BB: EBTB.OB) a leader in business-to-
business transaction management services, elected Robert L.
Priddy as Chairman of the Board, replacing Bruce Haber, who has
resigned.

Mr. Haber will continue to assist the Company as an independent
consultant.

Mr. Priddy is currently chairman and chief executive officer of
RMC Capital, LLC. He was one of the four founding partners of
ValuJet Airlines and served in a variety of executive positions
for the airline through 1997, following its merger with AirTran
Airways. Mr. Priddy remains a Director of AirTran Airways, a New
York Stock exchange company. Prior to that, Mr. Priddy served as
President of Florida Gulf Airlines and Air Midwest, and was one
of the three founders of Atlantic Southeast Airlines as well as
its chief financial officer. He is a significant private
investor in eB2B Commerce, Inc.  Mr. Priddy received a Bachelor
in Arts from Tulane University in 1969, majoring in Economics.

In addition, Thom Waye, Managing Director of Corporate Finance
and Business Development at Commonwealth Associates, has been
elected to the Board, replacing Mark Reichenbaum, who resigned
his position. Mr. Waye has primary responsibility for
originating Commonwealth's investment opportunities, private
placements, and public offerings. Mr. Waye previously held
various positions with American International Group's (AIG)
Financial Services companies, as well as led Motorola's and
Unisys' New York based Financial Services Marketing efforts. He
holds an MBA in Accounting and Finance from the Graduate School
of Business at the University of Chicago and a BS from Syracuse
University.

Commenting on the changes, eB2B's chief executive officer
Richard Cohan remarked, "The addition of Robert and Thom to the
Board strengthens our marketing and revenue focus. eB2B will
capitalize on their industry knowledge, skill, and business
relationships to continue to penetrate our market. Robert, in
helping to found and run two major airlines, has a keen sense of
the value that is delivered by streamlining the supply chain and
making business-to-business commerce more cost-effective. Thom
has had years of experience building transaction and services
based businesses and generating revenue growth."

eB2B Commerce, which reported a working capital deficit of about
$3.2 million at Sept. 30, 2002, is a leading provider of
electronic business-to-business services that simplify trading
partner integration and collaboration for order management and
supply chain execution. The eB2B Trade Gateway and Outsourcing
Services solutions provide enterprises large and small with low
cost, high return methods for allowing trading partner
relationships to be more productive and profitable.


ENCOMPASS SERVICES: UST & Committee Balk at Deloitte Engagement
---------------------------------------------------------------
The U.S. Trustee and the Official Committee of Unsecured
Creditors, appointed in Encompass Services Corporation and
debtor-affiliates' chapter 11 cases, complain that Deloitte's
indemnification provision is unreasonable because there is no
limitation on the nature and amount of claims covered.  Hector
Duran, Esq., Trial Attorney for the U.S. Department of Justice,
Office of the U.S. Trustee, in Houston, Texas, contends that the
Indemnification Provision is calculated to reduce or eliminate
the estates' recovery of damages for any wrongdoing by Deloitte,
and to impose future unknown fees, costs and other
administrative expenses on the estates without any demonstrated
benefit in return.

The Provision also contains unreasonable terms and conditions of
employment and is too broad with respect to the persons or
entities protected.  Mr. Duran points out that the Debtors did
not indicate:

   1. whether the estates could have obtained comparable services
      for the same price from another professional that would
      forego indemnification;

   2. on what terms Deloitte would agree to removal of the
      Indemnification Provision;

   3. whether the liability protections in Deloitte's Engagement
      Letter were negotiated at arm's length;

   4. whether any insurance might be available to protect
      Deloitte;

   5. whether they have estimated the potential cost to the
      estates of the Indemnification Provision; and

   6. whether they have the financial ability to make future
      indemnity payments.

Without this information, Mr. Duran notes that the Debtors'
decision to retain Deloitte may involve a breach of their
fiduciary obligations to their creditors and may impair the
creditors' potential recovery in these cases. (Encompass
Bankruptcy News, Issue No. 5; Bankruptcy Creditors' Service,
Inc., 609/392-0900)


ENRON CORP: Wants to Implement 2nd Key Employee Retention Plan
--------------------------------------------------------------
Martin J. Bienenstock, Esq., at Weil, Gotshal & Manges LLP, in
New York, reminds the Court that it approved a Key Employee
Retention Plan early in the chapter 11 cases involving Enron
Corporation and its debtor-affiliates.  That retention and
severance program expires on February 28, 2003.  Prior to
approval of that KERP, attrition at the Company averaged 34
voluntary resignations per week.  That attrition rate
jeopardized Debtors' ability to operate and maximize the value
of their businesses.  Almost immediately after the KERP was
approval, Mr. Bienenstock relates, the attrition rate decreased
to an average of nine voluntary departures per week.  The KERP
proved to be a reasonable effective tool to slow the premature
flight of Key Employees.

As the Debtors prepare to negotiate a Chapter 11 plan, the value
of the Debtors' businesses cannot be preserved and maximized for
their creditors' benefit without the employees critical to the
operation of those businesses.  The Key Employees possess unique
knowledge, skills and experience, as well as customer and
supplier relationships, vital to the business enterprise, all of
which are in many cases, impracticable or impossible to
replicate.  The continued employment, dedication and motivation
of Key Employees are essential to the Debtors' preservation and
prosperity, and undertaken by the Debtors heightens the
importance of the Key Employees to remain with the Debtors.  To
retain these employees, the Debtors have determined that they
must provided a financial incentive for continued employment and
assure reorganization effort.

Accordingly, the Debtors seek the Court's authority to implement
the Key Employee Retention and Severance Plan II pursuant to
Section 363(b) of the Bankruptcy Code.

According to Mr. Bienenstock, the KERP II is substantially in
similar material terms to KERP I.  KERP II has two principal
components:

     (1) a Retention Payment component designed to retain
         employees; and

     (2) a Severance Benefit component for certain departing
         employees.

Mr. Bienenstock explains that the main distinctions between KERP
I and KERP II are that KERP I addresses, inter alia, Liquidation
Incentives and KERP I changes the Retention Payments' proportion
paid at quarter end versus that paid on the Deferred Payment
Date.  Under KERP I, 25% of the Retention Payment was paid at
the end of each Quarter, and 75% was deferred to the Deferred
Payment Date.  Under KERP II on the other hand, the Debtors
propose to distribute 50% of each Retention Payment at the end
of each Quarter with the remaining 50% to be paid on the
Deferred Payment Date.  If approved, KERP II will take effect on
March 1, 2003.

                      Retention Payments Component

The Management Committee will identify up to 900 employees as
"Retention Participants" during each Quarter.  However, the
Management Committee, in consultation with the Debtors' Chief
Restructuring Officer and Chief Executive Officer, continues to
evaluate the requirements of these Chapter 11 cases and the
Debtors' businesses in light of changing economic and business
conditions.  Accordingly, the Management Committee reserves the
right to change the Key Employees who are to participate in the
Retention Payments component.

An employee selected for participation in the Retention Payment
component generally I eligible for payment under that program,
provided the employee continues employment with the Debtors
through the earlier of involuntary termination of employment
without cause or February 27, 2004.

Under the Retention Payments component, Mr. Bienenstock informs
Judge Gonzalez, the Retention Participants are eligible to
receive Retention Payments for four quarters, ending on May 30,
2003, August 29, 2003, November 28, 2003 and February 27, 2004;
provided that the Retention Participant has not been terminated
for cause or has not resigned during the Quarter.  A Retention
Participant who is terminated without cause mid-Quarter will
receive a Retention Payment for that Quarter based on salary
earned during that Quarter, but will not be eligible for
Retention Payments thereafter.

As soon as practicable at the end of the Quarter, 50% of the
Quarterly Retention Payment will be paid.  The remaining 50%
will be deferred and will be paid as soon as practicable after
the earlier of:

     (i) February 27, 2004; or

    (ii) the Participant's death, disability or involuntary
         termination without cause.

Mr. Bienenstock clarifies that although KERP I has been
reasonably successful, the Debtors believe that the high risk of
premature Key Employee flight soon after February 28, 2003  --
the expiration of the Retention Payments component of KERP I --
requires that the Debtors distribute a greater portion of the
Retention Payments under KERP II earlier to encourage Key
Employees to remain.

If an employee voluntarily resigns or is terminated for cause
prior to the Deferred Payment Date, all Deferred Payments will
be forfeited.  Any amount forfeited may be reallocated in the
same amount, at the same time and among the Retention
Participants as the Management Committee determines in its sole
discretion.  In connection with any reallocation, of if the
Management Committee determines that unused Retention Benefits
should be reallocated for other retention, bonus or severance
purposes, the Debtors will notify the Creditors' Committee in
writing of the terms of the proposed reallocation, and may
proceed without any requirement of Court approval if there is no
objection from the Creditors' Committee.

Mr. Bienenstock informs the Court that the amounts payable to
Retention Participants under the Retention Benefits component of
KERP II will not exceed $29,000,000, exclusive of amounts
approved but unused under KERP I, which, if authorized by this
Court, will be carried over to KERP II.

                    Severance Benefits Component

The Severance Benefits component of KERP II is intended to
provide competitive security for employees ineligible to
participate in the Retention Program and those Retention
Participants who do not receive Retention Payments of a certain
level.

An employee who is eligible for Severance Benefits will receive
a minimum severance payment of $4,500.  The Severance Benefits
for a Severance Participant will be calculated to be the greater
of:

     (i) two weeks of base salary per year and partial year of
         total service with a maximum of eight weeks of base
         salary; or

    (ii) two weeks of base salary per year, and partial salary,
         of total service plus two weeks of base salary per
         $10,000 increment, and partial increment, of base
         salary, with the total sum not to exceed $13,500.

Retention Participants who are eligible to receive Severance
Benefits will have either their Severance Benefits reduced
dollar for dollar by any Retention Payments received by that
Participant.

The Debtors estimate that 200 employees will participate solely
in the Severance Benefits component of KERP II.  A little fewer
than 100 employees who are also eligible for the Retention
Payments component will also participate in the Severance
Benefits component.  The maximum amount paid under the Severance
Benefits component will be the remainder of the $7,000,000
approved for Severance Benefits under KERP I, which, if
authorized by this Court, will be carried over to KERP II.

From those carried over funds, the maximum aggregate amount
payable from the Severance Benefits component to all Retention
Participants in the aggregate will not exceed $500,000.
Notwithstanding, in the event of forfeiture of Severance
Benefits or Retention Payments, or the determination by the
Debtors that Severance Benefits or Retention Payments funds are
available and should be reallocated for other retention, bonus
or severance purposes, the Debtors propose that they notify in
writing the Creditors' Committee of any proposed reallocation
and be allowed to proceed without any requirement of court
approval if there is no objection from the Creditors' Committee.

                    Conditions of KERP II Payments

To be eligible to receive the benefits under the KERP II:

   (a) Participants must certify that, inter alia, they have not
       engaged in insider trading and will disgorge KERP II
       payments if later adjudged to have engaged in acts of
       dishonesty or willful misconduct; and

   (b) to receive any Final Payment under KERP II, Participants
       must execute a general release, which will release all
       claims against the Debtors, including those arising out
       of employment or the termination thereof, but final
       payment under KERP II, most ERISA plan claims, claims for
       non-qualified deferred and incentive executive
       compensation, workers' compensation and unemployment
       insurance benefits, and director and officer
       indemnification coverage.

Mr. Bienenstock contends that the KERP II should be approved
because:

   (a) with the rapidly approaching expiration of the Retention
       and Severance portions of KERP I, and the uncertainty
       attendant to the Debtors' reorganization, including the
       results of the bid process related to the potential sale
       of the core businesses assets, the Debtors face an
       imminent risk of the premature flight of Key Employees;

   (b) some of the Key Employees are assisting in the
       liquidation of non-core businesses in which they
       themselves are employed.  Without some security or
       compensation for the attendant risk of losing their jobs,
       these employees have little or no reason to defer finding
       new jobs;

   (c) without KERP II, there would be a substantial reduction
       in the total historic compensation opportunity for Key
       Employees since their various equity-based incentive
       compensation benefits are now unavailable, the 401(k) plan
       has lost its value and the Debtors' lack of ability to
       provide meaningful incentives to Key Employees;

   (d) filling vacant positions is difficult by the present
       state of the Debtors' reputation and outsourcing many of
       these functions is impractical; and

   (e) outsourcing the Debtors' work would consistently and
       significantly exceed the cost of retaining employees
       through KERP II and would not guarantee the level of
       expertise and skill necessary to meet current business
       objectives. (Enron Bankruptcy News, Issue No. 55;
       Bankruptcy Creditors' Service, Inc., 609/392-0900)

DebtTraders reports that Enron Corp.'s 9.125% bonds due 2003
(ENRN03USR1) are trading at about 14 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=ENRN03USR1
for real-time bond pricing.


EOTT ENERGY: Brings-In H. Keith Kaelber as New EVP and CFO
----------------------------------------------------------
EOTT Energy Partners, L.P., announced that H. Keith Kaelber has
joined EOTT as executive vice president and chief financial
officer.

"Mr. Kaelber brings to EOTT extensive experience in the energy
marketing and pipeline business. Mr. Kaelber's professional
background spans 31 years including 23 years of energy finance.
With the anticipated approval of the reorganization plan and
emergence from Chapter 11 early in 2003, Mr. Kaelber's financial
and business development experience will strengthen our ability
to focus on the financing required to achieve our future growth
and asset development strategy," said Dana Gibbs, EOTT's
President and Chief Executive Officer.

Prior to joining EOTT, Kaelber served as President of INDWELL, a
non profit organization. Previously he was President, Financial
Services and Senior Vice President and Chief Financial Officer
for NGC Corp. (which was the predecessor of Dynegy). Prior to
his position with NGC Corp., he served as Executive Vice
President, Energy Banking Group with NCNB Corp., Texas and
Senior Vice President, Energy Banking Group, Republic Bank
Dallas (which was subsequently acquired by Nations Bank).
Kaelber holds a bachelor's degree with distinction in business
and a master's degree in finance from Indiana University.

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

Eott Energy Partners' 11.00% bonds due 2009 (EOT09USR1) are
trading at about 57 cents-on-the-dollar, says DebtTraders. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=EOT09USR1for
real-time bond pricing.


FLEETWOOD ENTERPRISES: Completes Credit Facility Restructuring
--------------------------------------------------------------
Fleetwood Enterprises, Inc. (NYSE: FLE), the nation's largest
manufacturer of recreational vehicles and a leading producer and
retailer of manufactured housing, successfully restructured its
revolving line of credit to provide greater flexibility and
borrowing capacity. The maximum amount of the line of credit,
which is provided through a syndicate of banks led by Bank of
America, N.A., as administrative agent, has been reduced from
$190,000,000 to $110,000,000. This more closely matches the size
of the line to the loan value of the borrowing base, or pool of
inventory and receivables, that supports Company borrowings. At
the same time, the lenders agreed to reduce the borrowing
availability reserve that the Company is required to maintain
from $50,000,000 to $30,000,000, and to release certain excess
real estate and equipment collateral.

The covenants remain essentially unchanged, and Fleetwood
remains in full compliance with these covenants. In addition,
the amendment eliminates a previously announced $1.9 million fee
that was scheduled to become due as of the end of the Company's
third fiscal quarter, on January 26, 2003.

Additional provisions of the amendment allow greater flexibility
in making capital contributions, advances and distributions
among Fleetwood and its subsidiaries. The amendment specifically
authorizes Fleetwood to make additional capital contributions to
its HomeOne Credit finance subsidiary, and to enter into a
warehouse line of credit to further support the operations of
HomeOne. In return, Fleetwood paid a fee of three-eighths of a
percent of the new commitment amount to the syndicate.

"The reduction in the availability reserve immediately improves
our liquidity, and the additional flexibility that the amendment
provides will help us accomplish such key goals as building our
HomeOne finance company," said Boyd R. Plowman, Fleetwood's
executive vice president and chief financial officer.

                           *    *    *

As previously reported, Fleetwood executed an agreement with its
lenders to revise the covenants on its credit facility to
reflect current market conditions.  While the Company expected
to report improved results in the first quarter of fiscal 2003,
management did not foresee achieving profitability in the
quarter.


FOAMEX INT'L: William D. Witter Discloses 6.4% Equity Stake
-----------------------------------------------------------
William D. Witter, Inc., and William D. Witter, President of the
firm, beneficially own 6.4% of the common stock of Foamex
International, Inc.  The firm holds 1,571,434 shares of Foamex
common, with sole power to vote, or direct the vote of,
1,368,634 shares, and sole power to dispose of, or direct the
disposition of, the total 1,571,434 shares.

The shares owned directly by Witter, Inc. are held on behalf of
various clients of the firm. These clients have the right to
receive or power to direct the receipt of dividends from, or the
proceeds, from the sale of, such securities.

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

At September 29, 2002, Foamex's balance sheet shows a total
shareholders' equity deficit of about $157 million, as compared
to a deficit of about $181 million at December 31, 2001.


FRONTLINE COMMS: Provo Acquisition Revised to Exclude Kiboga
------------------------------------------------------------
Frontline Communications Corp. (AMEX:FNT) -- http://www.fcc.net
-- clarified that the previously announced purchase agreement to
acquire two entities has been revised to include only one
company.

Under the terms of the revised agreement, the Company will
acquire Proyecciones y Ventas Organizadas, S.A. de C.V. (Provo)
with 2001 reported revenue of approximately $120 million, in an
all stock exchange. Upon closing, the shareholders of Provo will
own preferred stock which will be convertible into a majority of
the Company's common stock or other securities of the Company.
The transaction is subject to certain closing conditions,
including the satisfactory completion of due diligence, and
regulatory and shareholder approvals, and is expected to close
in the first quarter of 2003. The Company's intent is for its
common stock to continue to trade on the American Stock Exchange
after the consummation of the transaction.

Provo -- http://www.provo.com.mx-- a Mexican corporation,
maintains a dominant position within the prepaid calling card
and cellular phone airtime markets in Mexico. Provo is currently
anticipating expanding its existing services to the continental
United States, and intends to begin marketing "smart cards"
based on recently developed proprietary chip-based software in
the near future. Provo and its affiliates have been in operation
for over seven years, and had combined reported (unaudited)
revenue in 2001 of approximately $120 million, with operating
profits of approximately $1 million. Unaudited results of the
combined entities for the twelve months ending December 31, 2002
indicate revenue in excess of $100 million. Under the terms of
the Agreement, Provo will acquire a significant majority of the
equity of its affiliates prior to the closing of the
transaction.

Founded in 1995, Frontline Communications Corporation provides
high-quality Internet access and Web hosting services to homes
and businesses nationwide. Frontline offers e-commerce,
programming and Web development services through its PlanetMedia
group, http://www.pnetmedia.com Frontline is headquartered in
Pearl River, New York, and is traded on the American Stock
Exchange.

At September 30, 2002, Frontline Communications' balance sheets
show a total shareholders' equity deficit of about $1.9 million.


GENUITY INC: Earns Nod to Hire Skadden Arps as Special Counsel
--------------------------------------------------------------
Genuity Inc., and its debtor-affiliates obtained Court approval
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.

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).

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


HUMAN GENOME: Establishes New European Subsidiary in Germany
------------------------------------------------------------
Human Genome Sciences, Inc., (Nasdaq: HGSI) announced the
creation of Human Genome Sciences Europe GmbH, a new subsidiary
that will be responsible for European clinical trials of the
company's rapidly evolving portfolio of new drugs in clinical
and late-stage preclinical development.  The new subsidiary will
be based in Dusseldorf, Germany, and will report to David C.
Stump, M.D., Senior Vice President, Drug Development.

Florian Bieber, M.D., formerly Head of the Cardiovascular,
Metabolic Disorders, and Central Nervous System Therapeutic
Areas for Bayer AG, has joined Human Genome Sciences as Vice
President, Drug Development -- Europe.  Dr. Bieber will work
with Dr. Stump to lead Human Genome Sciences Europe and to
manage Human Genome Sciences' clinical trials and clinical
research collaborations in European countries.

David C. Stump, M.D., Senior Vice President, Drug Development,
said, "It will be increasingly important, as our products in
clinical and late-stage preclinical development continue to
progress, that we are able to move them forward on a global
basis.  We expect that Human Genome Sciences Europe will play a
significant role in the continuing advancement of our products.
Florian Bieber is experienced in all key aspects of the
multinational development of new drugs, and has had personal
responsibility for leading clinical projects and developing
regulatory strategy in the European Union, including individual
countries such as Germany and France.  He is particularly well-
suited to lead our European clinical development effort, and I
look forward to working closely with him in that capacity."

William A. Haseltine, Ph.D., Chairman and Chief Executive
Officer, said, "The European Union is the second largest
pharmaceutical market in the world, and it is essential that we
have an effective clinical development capability in place that
will enable harmonization of clinical trials and regulatory
strategy throughout Europe.  The formation of Human Genome
Sciences Europe is an important milestone of progress toward our
ultimate goal of becoming a global biopharmaceutical company
that discovers, develops, manufactures and markets our own gene-
based drugs."

Dr. Bieber has ten years of experience in pharmaceutical product
development with Bayer AG.  As Head of the Cardiovascular,
Metabolic Disorders, and Central Nervous System Therapeutic
Areas within Bayer AG Product Development, Dr. Bieber had
worldwide responsibility for setting direction and strategy for
all development activities for Bayer AG's clinical and
preclinical portfolio of drugs in these therapeutic areas.  His
experience includes:  regulatory strategy, initiation and
harmonization of clinical studies in all phases of
pharmaceutical drug development, and coordination and
presentation of submission dossiers seeking marketing clearance
from regulatory authorities in the European Union, a number of
individual European countries, and North America.  Dr. Bieber
began his career in 1989 as a physician at City Hospital in
Darmstadt, Germany.  He received his B.S. degree in biology from
the University of Frankfurt, and his M.D. from Johannes
Gutenberg University, Mainz, Germany.

Human Genome Sciences has a rapidly evolving portfolio of new
drugs in clinical and late-stage preclinical development.  To
date, the company has advanced eight products to human clinical
trials, including potential treatments for cancer, autoimmune
diseases, immune deficiencies, venous ulcers, hepatitis C, and
adult and pediatric growth hormone deficiency.

For additional information on Human Genome Sciences, please
visit the Web site at http://www.hgsi.com

Human Genome Sciences is a company with the mission to treat and
cure disease by bringing new gene-based drugs to patients.

Human Genome's 5.000% bonds due 2007 are currently trading at
about 71 cents-on-the-dollar.


HYDRO ONE: Ontario Electricity Fin'l Selling All Hydro One Debt
---------------------------------------------------------------
Hydro One Inc., announced that Ontario Electricity Financial
Corporation intends to sell some or all its Hydro One debt in
the Canadian public debt markets, likely commencing in the first
quarter of 2003. OEFC holds approximately $2.53 billion of Hydro
One debt maturing between 2003 and 2007, with a weighted average
term to maturity of approximately two years.

In order to facilitate the sale, Hydro One has agreed in
principle with OEFC to restructure some or all of the Hydro One
debt held by OEFC. It is anticipated that the approximately
$2.53 billion of existing debt with a weighted average interest
rate of approximately 8% would be exchanged for approximately
$2.75 billion of debt with a weighted average interest rate of
approximately 4%. The actual principal amount and interest rate
of the restructured notes would be based upon market interest
rates at the time of execution of a definitive agreement. This
debt restructuring would result in lower cash interest payments
for Hydro One from 2003 through 2007 and a corresponding
increase in the principal amount of the debt payable at
maturity. The maturity dates would remain essentially unchanged
as would the market value of Hydro One's debt obligations to
OEFC.

For Hydro One's current debt maturity schedule visit link:
http://www.HydroOne.com/InvestorRelations/debtinfo/content.asp


INTEGRATED HEALTH: Competing Bidders Going to Court this Morning
----------------------------------------------------------------
Integrated Health Services, Inc., and its debtor-affiliates held
an auction for substantially all of their assets on January 22,
2003, at Kaye Scholer LLP's New York offices.  Abe Briarwood
Corp., Integrated and its Creditors' Committee concluded,
presented the highest and best bid.  Integrated will ask Judge
Walrath to ratify that alternative transaction at 10:30 a.m.
today and send Trans Healthcare, Inc., home with its $6 million
break-up fee.

James A. Stempel, Esq., at Kirkland & Ellis in Chicago says that
Trans Healthcare didn't come this far with its multi-million
dollar bid to be outbid in a flawed auction process by an
unqualified bidder.  Trans Healthcare complains that:

     (1) Briarwood's $110.5 million bid is reduced by a $7.5
         million escrow and, therefore, not $10 million greater
         than its $97.5 million bid;

     (2) the Briarwood Bid has a $2 million break-up fee attached
         to it but break-up fees for competing bidders were
         specifically prohibited under the Sale Procedures
         approved by the Court;

     (3) Briarwood has no managerial experience and does not
         operate a single nursing or therapy facility;

     (4) Nobody can know at this juncture whether Briarwood will
         be accepted as a payee by the Centers for Medicare and
         Medicaid Services and the Department of Health and Human
         Services;

     (5) Briarwood's bid doesn't contain the commitment to
         continue leasing IHS' Sparks, Maryland, headquarters for
         five years -- something of significant value to the
         estates.

The Federal Trade Commission has approved Trans Healthcare,
Inc.'s proposed acquisition of substantially all of the assets
and operations of Integrated Health Services, Inc. through a
stock transaction.  THI has financial backing from GTCR Fund VI,
L.P. in place.  The waiting period under the Hart-Scott-Rodino
Antitrust Improvements Act of 1976, as amended, has expired
without action in relation to the previously announced purchase
agreement between THI and IHS.  Trans Healthcare is ready,
willing and able to complete the transaction if Judge Walrath
will shoo Abe Briarwood away.


KMART: Fitch Says Store Closings Trigger Few CMBS Downgrades
------------------------------------------------------------
Fitch Ratings downgrades only six classes in five transactions
and places one class of another transaction on Rating Watch
Negative following its review of 40 multi-borrower commercial
mortgage-backed securities (CMBS) transactions with Kmart
exposure. The reviewed transactions contain loans with Kmart
stores scheduled to close following Kmart's announcement on
Jan. 14, 2003, that it will close an additional 326 stores and
seek bankruptcy court approval for the rejection of the leases.
Deals that Fitch affirms are listed at the end of this press
release. Individual press releases dated Jan. 24, 2003, provide
more detail on each transaction that was downgraded or placed on
Rating Watch Negative.

Last year, Fitch downgraded five CMBS transactions as a result
of Kmart store closings. In those cases, as is true in this
round of downgrades, the rating actions occurred in transactions
that expect losses on other loans in the deal as well.

"Given the size and scope of the Kmart default, the fact that
there have been so few downgrades serves as testament to the
resilience and effectiveness of the structure and loan diversity
of conduit CMBS," said Karen Trebach, director, Fitch Ratings.

Fitch-rated CMBS transactions are currently assessed adequately
for Kmart exposure, although it is difficult to predict whether
Kmart will achieve its announced goal of emerging from
bankruptcy in April 2003.

"Conflicting economic indicators bear watching in assessing
conditions in CMBS transactions where exposure to a single large
retail chain could impact multiple transactions," said Mary
MacNeill, senior director, Fitch Ratings. "CMBS exposure to
retail is relatively high."

The downgrades are as follows:

      CSFB 98-C1

           --Class I to 'CCC' from 'B-'.

      DLJ 00-CKP1

           --Class B-7 to 'B-' from 'B+'.

      FUNB 2000-C1

           --Class M to 'CCC' from 'B-'.

      MCF 97-MC1

           --Class H to 'CCC' from 'B'.

      MCF 98-MC2

           --Class J to 'B-' from 'B';

           --Class K to 'CCC' from 'B-'.

The following class is placed on Rating Watch Negative:

      CSFB 97-C2

           --Class G 'BB-'.

A higher expected loss severity is assumed on the stand-alone
properties as compared to properties in which Kmart represents
less than 50% of the net rentable area. When determining which
bonds are most affected by the Kmart store closings, Fitch
compared the amount of credit enhancement to a specific tranche
versus an expected loss percentage. The expected loss percentage
is based on: (i) a loss factor of 0% to 75% applied to the loan
balance, based on the percentage NRA represented by Kmart in the
center; (ii) a pooling factor was applied based on the number of
Kmart's within the pool and (iii) an additional loss factor was
taken on the total loans of concern (exclusive of Kmart). The
calculation resulted in an expected loss for the pool.

If the expected loss approximated or was less than the
subordination level to the lowest class(es), the rating on that
class(es) was affirmed. If the expected loss exceeded the lowest
class's subordination level, the class was downgraded or placed
on Rating Watch Negative pending receipt of further information
from the servicer.

Deals affirmed by Fitch:

      --ASC 1997-D4;

      --Bear Stearns 1998-C1;

      --Bear Stearns 2000-WF1;

      --CBA 1993-C1;

      --CAPCO 1998-D7;

      --Chase 1997-1;

      --Chase 2000-1;

      --DLJ 1998-CF2;

      --FUNB-CMB 1999-C2;

      --GECCMC 2001-1;

      --GE 2002-3;

      --GMAC 1997-C2;

      --GMAC 1998-C2;

      --GMAC 1999-C3;

      --GS 1998-C1;

      --Heller 2000-PH1;

      --JPM 2001-CIBC1;

      --LB 1999-C1;

      --LB-UBS 2000-C3;

      --MCF 1996-MC1;

      --MCF 1998-MC1;

      --MLMI 1995-C1;

      --MLMI 1997-C1;

      --MLMI 1998-C1-CTL;

      --Midland 1996-C1;

      --MS 1998-WF1;

      --MS 1998-XL1;

      --MS 1999-CAM1;

      --MSDW 2001-Top1;

      --MSDW 2001-Top3;

      --NLF 1999-2;

      --Pru Rock 2001-C1;

      --SASCO 1996-CFL;

      --SBM7 2002-CDC.

DebtTraders reports that Kmart Corp.'s 9.000% bonds due 2003
(KM03USR6) are trading at about 13 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=KM03USR6for
real-time bond pricing.


KMART CORP: Proposes Uniform Store Closing Sales Procedures
-----------------------------------------------------------
To minimize any potential conflicts with landlords or other
interested parties, Kmart Corporation and its debtor-affiliates
propose these Store Closing Sales procedures:

   (a) the Store Closing Sales will be conducted so that the
       affected stores remain open during the normal hours of
       operation provided for in the affected stores' leases.
       The Debtors or a store closing agent will not conduct an
       auction or fire sale and will abide by mall hours and all
       mall guidelines concerning maintenance, security and trash
       removal;

   (b) the Store Closing Sale will be conducted in accordance
       with applicable state and local "Blue Laws" and thus,
       where applicable, no Store Closing Sales will be conducted
       on a Sunday;

   (c) the Debtors or the Store Closing Agent will not distribute
       handbills, leaflets or other written materials to
       customers outside of any affected store's premises, except
       as permitted by the lease or agreed to by the landlord.
       The Debtors and the Store Closing Agent, nevertheless, may
       solicit customers in the stores themselves.  The Debtors
       or Store Closing Agent will not use flashing lights or any
       type of amplified sound to advertise the Store Closing
       Sales or solicit customers, except as permitted by the
       lease or agreed to by the landlord;

   (d) the Debtors and the Store Closing Agent will be permitted
       to augment or otherwise bring new merchandise into the
       affected stores in order to maintain a desired mix of
       merchandise; provided, however, that the merchandise is of
       the same type or quality as the Merchandise currently or
       previously sold in the affected Stores;

   (e) the Store Closing Sales subject to the Operating Agreement
       will end on or before the applicable Sale Termination Date
       provided in the Operating Agreement.  Within 30 days
       after the conclusion of the Store Closing Sales, the
       Debtors will disclose Store Closing Sales figures to those
       landlords paid on a percentage rent basis;

   (f) at the conclusion of the Store Closing Sales, the Store
       Closing Agent will vacate the affected stores in
       "broom-clean" condition, and will otherwise leave the
       stores in the same condition as on the commencement of the
       Store Closing Sales, ordinary wear and tear excepted.
       However, the Debtors are not obligated to undertake any
       greater obligation than set forth in an applicable lease
       with respect to a store.  The Debtors or the Store Closing
       Agent may sell any Debtor-owned furniture, fixture and
       equipment that is located in the affected stores during
       the Store Closing Sales.  The Debtors or the Store Closing
       Agent, as the case may be, may advertise the sale of a
       Furniture, fixture or equipment.  The purchasers of any
       furniture, fixture or equipment sold during the Store
       Closing Sales will only be permitted to remove its
       purchased item either through the back shipping areas or
       through other areas after store business hours;

   (g) the Store Closing Agent will not advertise or market the
       Store Closing Sales as a "going out of business" sale.
       Moreover, the Store Closing Agent will not advertise or
       market the Store Closing Sales as a "bankruptcy" sale.  In
       all states, signs advertising the Store Closing Sale will
       contain the words "store closing" or words of similar
       import.  The Debtors or the Store Closing Agent will post
       a sign in the cash wrap areas of the affected stores to
       the effect that all sales are "final";

   (h) neither the Debtors nor the Store Closing Agent will make
       any alterations to the storefront or exterior walls of any
       of the affected stores, including the removal of store
       signs.  The posting of signs, if allowed as provided, will
       not be deemed an alteration;

   (i) the Debtors or Store Closing Agent will keep affected
       store premises and surrounding area clear and orderly
       consistent with present practices;

   (j) the landlords of the affected Stores will have reasonable
       access to the store premises on the conclusion of the
       Store Closing Sales solely for the purpose of dressing
       Store's windows to minimize the appearance of a dark
       store;

   (k) no property of any landlord of an affected store will be
       removed or sold during the Store Closing Sales;

   (l) the Debtor or the Store Closing Agent will only utilize
       existing furniture, fixtures and equipment to conduct the
       Store Closing Sales, unless a landlord otherwise consents;
       and

   (m) the Debtors or Store Closing Agent will designate a party
       to be contacted by the landlords should an issue arise
       concerning the conduct of the Store Closing Sales. (Kmart
       Bankruptcy News, Issue No. 45; Bankruptcy Creditors'
       Service, Inc., 609/392-0900)


LANDSTAR INC: Will Publish Fourth Quarter Results on February 6
---------------------------------------------------------------
Landstar System, Inc., (Nasdaq: LSTR) will release its 2002
fourth quarter results before the market opens on Thursday,
February 6, 2003. The Company will hold its quarterly conference
call with analysts and investors that same day at 2:00 pm, ET to
discuss the fourth quarter results and current outlook.

Interested parties may listen to the conference call's live
broadcast over the Internet on the Company's Web site,
http://www.landstar.comunder Investor Relations.
StreetEvents.com will also carry the broadcast live.

For those unable to participate in the live call, or for those
who do not have access to the Internet, the call will be
available on telephone replay for 24 hours.  The telephone
replay number for the U.S. and Canada is (800) 873-2082 and for
international calls is (402) 220-5056, reservation number
4879510.

Landstar's carrier group, comprised of Landstar Gemini, Inc.,
Landstar Inway, Inc., Landstar Ligon, Inc., and Landstar Ranger,
Inc., delivers excellence in complete over-the-road
transportation services.  Landstar's multimodal group, comprised
of Landstar Express America, Inc. and Landstar Logistics, Inc.,
delivers excellence in expedited, contract logistics and
intermodal transportation services.  All Landstar operating
companies are certified to ISO 9001:2000 quality management
system standards.  Landstar System, Inc.'s common stock trades
on the Nasdaq Stock Market(R) under the symbol LSTR.

Landstar, Inc.'s September 30, 2002 balance sheet shows a
working capital deficit of about $10 million, and a total
shareholders' equity deficit of about $664,000.


LEAR CORP: Working Capital Deficit Stands at $538MM at Dec. 31
--------------------------------------------------------------
Lear Corporation (NYSE: LEA), the world's largest automotive
interior systems supplier, reported its financial results for
the fourth quarter and full year of 2002 and updated its
earnings guidance for 2003.

Fourth-Quarter Highlights:

      * Delivered record fourth-quarter net sales of $3.8
        billion, up 10%

      * Earned $1.76 per share, up 18% from prior year's adjusted
        basis

      * Generated strong free cash flow of $171 million

      * Awarded first-ever total interior integrator program by
        General Motors

      * Improved quality for third straight year in J.D. Power
        2002 Seat Quality Report(TM)

For the fourth quarter of 2002, Lear posted net sales of $3.8
billion, operating income of $246.8 million and net income of
$118.0 million. For the fourth quarter of 2001, Lear reported
net sales of $3.4 billion, operating income of $68.6 million and
net loss of $48.8 million. Excluding non-recurring items and
goodwill amortization for the fourth quarter of 2001, Lear had
adjusted operating income of $217.8 million and adjusted net
income of $97.8 million.

The Company's December 31, 2002 balance sheet shows that total
current liabilities exceeded total current assets by about $538
million.

"The Lear business model is based on understanding our
customers' needs and consistently exceeding their expectations,"
said Bob Rossiter, chairman and chief executive officer of Lear
Corporation. "Continued quality improvement, solid financial
results and growth in our sales backlog, as well as the industry
awards and customer recognition we have received, all indicate
that our strategy is working."

Rossiter continued, "Without question, the major news from the
fourth quarter was the award of the first-ever total interior
integrator program from General Motors. This development, as
well as new business with Asian automakers, led to an increase
in our five-year sales backlog from $3.6 billion to $4.0
billion."

Net sales and operating income for the fourth quarter rose 10%
and 13%, respectively, compared with the year-ago adjusted
results, reflecting higher vehicle production in North America,
the addition of new business globally and a stronger Euro,
partially offset by lower Western European production and
platform mix. Earnings per share were up 18% from comparable
results a year ago, driven by higher sales, operating
efficiencies and lower interest expense. Lear generated free
cash flow of $170.5 million during the quarter, a result of the
strong earnings performance.

                     2002 Full-Year Results

For the full year, Lear posted record net sales of $14.4
billion, up 6% from 2001, reflecting higher vehicle production
in North America and the addition of new business globally,
partially offset by lower production levels in Western Europe
and South America and unfavorable mix. Reported operating income
for 2002 was $743.1 million, and net income was $13.0 million,
or $0.19 per share. Excluding the cumulative effect of a change
in accounting for goodwill, net income was $311.5 million, or
$4.65 per share.

Compared with 2001, adjusted operating income rose $63.2
million. Adjusted earnings per share were up $0.92, or 25%,
reflecting higher sales, operating efficiencies and lower
interest expense. For 2002, free cash flow was $394.7 million,
allowing the Company to further reduce its debt.

                          2003 Outlook

For the first quarter of 2003, the Company estimates net sales
will be up 6% to 8% from the year-earlier period, reflecting the
addition of new business and a stronger Euro. Higher industry
production in North America is expected to offset lower industry
production and unfavorable mix in Western Europe. We currently
project a corporate tax rate of 30% for 2003. Given these
assumptions, we expect earnings in the range of $0.90 to $1.00
per share, capital spending of approximately $100 million and
free cash flow of approximately $50 million.

For the full year, the Company estimates net sales to be
approximately $15 billion, compared with $14.4 billion in 2002.
The increase primarily reflects the addition of new business
globally and a stronger Euro, partially offset by lower vehicle
production in North America (16.0 million units versus 16.4
million units); Western Europe is expected to be essentially
flat at around 16 million units. Given this industry outlook and
our lowered tax rate, we expect earnings in the range of $5.20
to $5.40 per share. Full year capital spending is forecast at
approximately $300 million and free cash flow is estimated to be
approximately $400 million.

Lear Corporation, a Fortune 150 company headquartered in
Southfield, Mich., USA, focuses on integrating complete
automotive interiors, including seat systems, interior trim and
electrical systems. With annual net sales of $14.4 billion in
2002, Lear is the world's largest automotive interior systems
supplier. The company's world-class products are designed,
engineered and manufactured by 115,000 employees in more than
300 facilities located in 33 countries. Additional information
about Lear and its products is available on the Internet at
http://www.lear.com


LEGACY HOTELS: Dec. 31 Working Capital Deficit Reaches C$130MM
--------------------------------------------------------------
Legacy Hotels Real Estate Investment Trust (TSX: LGY.UN)
announced its unaudited financial results for the three months
and the year ended December 31, 2002. All amounts are in
Canadian dollars unless otherwise indicated. Legacy expects to
release its 2002 annual report in mid-March and will hold its
annual general meeting at 10:00 a.m. on April 24, 2003 at The
Fairmont Royal York in Toronto.

"Legacy continued its solid operating performance in the fourth
quarter, completing a year of impressive top-line results with
revenue per available room rising 5.7% over the fourth quarter
of 2001. For the year, Legacy posted a 3.4% RevPAR improvement
and increased hotel EBITDA by 4.1%," said Neil J. Labatte,
Legacy's President and Chief Operating Officer. "Legacy has
benefited from its well-diversified Canadian portfolio and its
operating performance has exceeded that of the overall Canadian
lodging industry."

Added Mr. Labatte, "Although top-line operating growth was
encouraging, our fourth quarter net income per unit and
distributable income per unit were lower due to higher fixed
costs, particularly insurance costs and property taxes, and the
timing of The Fairmont Washington, D.C. acquisition.
Specifically, fourth quarter results were negatively impacted by
the delay in the use of funds from the unit issuance in early
November, which were used to acquire the Washington hotel in
December, and the inclusion of one of the hotel's weakest months
in the results for this quarter."

                 Three Months Ended December 31, 2002

Fourth quarter revenues increased 11.6% to C$160.3 million on
the strength of portfolio-wide RevPAR improvements and the
additions of the Sheraton Suites Calgary Eau Claire on July 12,
2002 and The Fairmont Washington, D.C on December 4, 2002. These
two acquisitions contributed C$8.4 million in revenues during
the quarter. Hotel EBITDA for the three months ended
December 31, 2002 was unchanged from last year at C$27.5
million. Hotel EBITDA margin, defined as hotel EBITDA as a
percentage of operating revenues, was 17.2% compared with 19.1%
in the fourth quarter of 2001. This decline in margin relates
primarily to a significant increase in insurance costs and the
inclusion of the Washington hotel's December results. Legacy's
fourth quarter margins are historically low due to the
seasonality of travel demand and the fixed operating costs.

Net income of C$7.6 million was down from C$8.3 million in the
fourth quarter of 2001. Fourth quarter distributable income per
unit was C$0.02 compared with C$0.16 in 2001. The convertible
debenture distributions and the November unit offering
negatively affected the distributable income per unit. In
addition, distributable income in the prior period included the
one-time receipt of C$6.4 million, or C$0.08 per unit, relating
to the purchase of The Fairmont Empress and Fairmont Le Chƒteau
Frontenac.

RevPAR increased 5.7% for the quarter, driven by a 1.3 point
improvement in occupancy and a 3.6% increase in average daily
rate. RevPAR at the Fairmont managed properties was up 5.5% due
to increases in both occupancy and ADR of 1.8 points and 2.5%,
respectively. At the Delta managed properties, RevPAR improved
6.4% primarily from a 5.9% increase in ADR.

At December 31, 2002, Legacy had cash balances of C$46.2
million. Legacy continues to be conservatively financed with a
debt to total assets of 39.0%. Also, at the same date, the
Company total current liabilities eclipsed total current assets
by about C$130 million.

                          2002 Year-End Results

For the year ended December 31, 2002, Legacy reported operating
revenues of C$647.6 million, an increase of 6.7% over C$606.8
million reported in 2001. Hotel EBITDA improved 4.1% to C$146.0
million. The year-to-date growth in revenues is primarily
attributable to portfolio-wide RevPAR improvements as well as
the acquisitions of the Sheraton Suites Calgary Eau Claire in
July 2002 and The Fairmont Washington, D.C. in December 2002. We
anticipate significant revenue growth in 2003 following the full
year inclusion of these two properties.

Legacy reported net income of C$55.1 million for the year
compared to C$53.7 million in 2001. Distributable income per
unit decreased to C$0.57 from C$0.77 in 2001. The February 2002
issuance of convertible debentures and the unit offering in
November negatively impacted distributable income per unit.

In 2002, Legacy's RevPAR rose 3.4% from improvements in both ADR
and occupancy. RevPAR for Fairmont managed properties increased
2.4% as a result of growth in occupancy of 1.5 points and a
slight increase in ADR. The Delta managed properties experienced
better results with a 6.0% increase in RevPAR due to
improvements in both occupancy and ADR of 0.7 points and 5.0%,
respectively.

                       Corporate Developments

On December 4, 2002, Legacy completed its first acquisition
outside Canada with the purchase of the Monarch Hotel in
Washington, D.C, since re-flagged "The Fairmont Washington,
D.C." Legacy paid approximately C$238 million for the property
and financed this transaction through the assumption of an
existing mortgage of approximately C$80 million and funds from
Legacy's unit offering completed in November.

On November 21, 2002, Legacy completed a private placement of
C$100 million Series 3 senior unsecured debentures due
December 15, 2003. The net proceeds were used to replenish the
funds used to repay Legacy's Series 1B debentures, which matured
on November 15, 2002.

On November 1, 2002, Legacy completed a unit offering of 19.5
million units for gross proceeds of approximately $150 million.
Fairmont Hotels & Resorts Inc., Legacy's largest unitholder,
bought 6.5 million units to maintain its ownership position of
approximately 35%.

In October as previously announced, Legacy entered into an
agreement to purchase a AAA Five Diamond hotel located in the
northwestern United States. The acquisition is contingent on a
number of conditions and if it proceeds, it is anticipated that
the acquisition would close in mid-2003 at a purchase price of
approximately US$100 million.

During the fourth quarter, a new labor contract was settled at
the Delta Toronto East. Labor negotiations are in progress at
Fairmont Le Chateau Frontenac following the expiration of the
hotel's main labor contract on December 31, 2002. Although it is
not possible to predict the outcome of negotiations, management
is hopeful that negotiated contracts will be reached without
disruption. In 2002, ten hotels successfully settled new labor
contracts. Four hotels have contracts expiring in 2003.

Legacy's Board of Trustees declared aggregate fourth quarter
distributions of C$0.185 per unit. Distributions were paid in
two installments this quarter due to the unit offering which
closed on November 1, 2002. Legacy has maintained its current
quarterly distribution level for the past six quarters.
Distributions for the full year were C$0.74 per unit compared to
C$0.87 per unit in 2001. Current distributions are at a level
that the Board feels is sustainable in light of current economic
conditions. Legacy estimates that approximately 45% of its 2002
distributions will be taxable. The final tax analysis will be
available on Legacy's Web site at http://www.legacyhotels.caby
early March 2003.

                              Outlook

Commented Mr. Labatte, "Legacy's performance in 2002 benefited
from its well-diversified Canadian portfolio, given the
country's solid economy and the perception that Canada is a safe
travel destination. While leisure travel has remained strong,
business travel continues to be below historical levels. We
expect these trends to continue throughout 2003 as economic and
political uncertainties persist in the United States. Minimal
new hotel supply in our key markets should facilitate continued
stability."

Mr. Labatte continued, "We are excited about the future of The
Fairmont Washington, D.C. In 2003, our goal is to position this
property to fully realize the upside potential once the U.S.
economy improves. We expect significant growth to be realized at
this property beginning in 2004."

Commenting on Legacy's future growth, Mr. Labatte concluded,
"Legacy's fundamentals have not changed. The combination of the
quality of our portfolio, our financial capability and our hotel
management expertise positions us well for both internal and
acquisition growth. We are currently pursuing expansion
opportunities that we believe will complement our existing
portfolio while increasing the long term value for our
unitholders."

Legacy is Canada's premier hotel real estate investment trust
with 23 luxury and first class hotels and resorts with over
10,000 guestrooms in Canada and the United States. The portfolio
includes landmark properties such as Fairmont Le Chƒteau
Frontenac, The Fairmont Royal York and The Fairmont Empress. The
management companies of FHR operate all of Legacy's properties.


LEVI STRAUSS: Fitch Rates $750MM Secured Bank Facility at 'BB'
--------------------------------------------------------------
Levi Strauss & Co.'s new $750MM secured bank facility, maturing
in 2006, is rated 'BB' by Fitch Ratings. The facility will
replace Levi's existing 'BB'-rated $726 million secured bank
facility which was due to expire in August 2003. Fitch rates
Levi's $2.1 billion senior unsecured debt 'B+'.

The two-notch differential between the secured bank facility and
the senior unsecured debt reflects the significant asset
protection provided by the security. The Rating Outlook remains
Negative, reflecting the ongoing challenges Levi faces in
sustaining the growth in revenues it reported in its most recent
quarter.

The new facility consists of a $375 million revolving credit
facility due March 31, 2006 and a $375 million term loan due
July 31, 2006. The new facility will continue to be secured by a
first-priority interest in Levi's domestic inventories, certain
domestic equipment and a portion of the stock in certain
subsidiaries as well as by the company's valuable global
trademarks. Covenants in the new facility are similar to those
in the existing facility, though levels have eased to reflect
the progress the company has made in improving its business. The
covenants also give Levi greater latitude to proceed with its
current operating plan. Upon closing of the new facility,
Fitch's ratings on the existing bank facility will be withdrawn.

The ratings reflect Levi's solid brands with leading market
positions as well as its geographically diverse revenue base and
adequate cash flow generation. Of ongoing concern is the
difficulty the company has faced in growing sales, coupled with
the slower than expected pace of improvement in credit
protection measures.


LIN HLDGS: S&P Ups Rating to BB- over Fin'l Profile Expectations
----------------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit
ratings on LIN Holdings Corp., and its operating subsidiary, LIN
Television Corporation, to 'BB-' from 'B+' based on expectations
that LIN will further improve its financial profile in the near
term given its meaningful use of equity for acquisitions and its
use of cash flow to repay debt.

At the same time, Standard & Poor's assigned its 'BB' rating to
the company's proposed $175 million term loan due 2008. Proceeds
are expected to be used for general corporate purposes,
including the potential call of LIN's 10% senior discount notes.
The outlook is stable. The Providence, Rhode Island-based
television station operator had total debt outstanding of about
$902 million at Sept. 30, 2002.

"LIN is likely to be a consolidator of TV stations in the mid-
size market, and acquisitions are expected to be financed in a
manner that maintains leverage ratios consistent with the
rating," said Standard & Poor's credit analyst Alyse Michaelson.
She added, "Given that currently favorable trends in TV
advertising could be vulnerable to economic cycles and
escalating political tensions overseas, adherence to a de-
leveraging financial policy will be important to the stability
of key credit ratios."

The ratings reflect LIN's stations' leading positions in mid-
size markets, good geographic and network affiliation diversity,
the decent margin and free cash flow potential of the business,
and fairly robust station asset values. These factors are offset
by the company's high financial risk from debt-financed TV
station acquisitions, expectations of further purchases that
could restrain financial profile improvement, and mature growth
prospects of the TV station business.

Overall TV ad spending increased in 2002 due to improving demand
and easier revenue comparisons in the second half of the year.
Political advertising provided a boost, contributing
approximately 6% of the company's revenue. Although ad spending
across a broad base of sectors, along with spillover demand from
tight network scatter time availability, is contributing to TV
advertising's rebound, the absence of political and Olympic
Games ad dollars could make comparisons difficult in 2003.

Maintenance of key credit ratios, de-leveraging financial
policies, and station market positions are important to ratings
stability.


LTV CORP: Resolves Conflict over Use of Copperweld's Tax Refund
---------------------------------------------------------------
The LTV Corporation and its debtor-affiliates, the Official
Committee of Unsecured Creditors, the Official Committee of
Noteholders, and the Term Lenders, present the Court with a
Stipulation regarding use of Copperweld's Tax Refund.

The Job Creation and Worker Assistance Act of the Internal
Revenue Code provides that the two-year net operating loss
carry-back period is extended to five years for any net
operating loss arising in any taxable year ending during 2001 or
2002.  As a result of this carry-back extension, Copperweld
Corporation is entitled to carry back certain of its 2001 net
operating losses to its 1997 taxable year, generating a refund
claim of approximately $7.5 million.

The pertinent terms of the Stipulation are:

      (1) Copperweld and The LTV Corporation will jointly file
          an Application for Tentative Refund.

      (2) The LTV Corporation shall have control rights over the
          Joint Refund Application, including authority to:

             (i) supervise the filing of the Joint Refund
                 Application; and

            (ii) any attendant procedures.

      (3) Notwithstanding the grant of authority to The LTV
          Corporation, the Joint Refund Application will
          identify Copperweld as the party entitled to receive
          direct payment of the refund proceeds, and will
          direct the Internal Revenue Service to pay the refund
          proceeds directly to Copperweld.

      (4) The LTV Corporation must act only after consultation
          with Copperweld, and may not waive, alter, amend,
          adjust, defer, set off, or otherwise compromise the
          refund claim or proceeds with the prior written
          consent of Copperweld, or the entry of a court order.

      (5) Once received, Copperweld will hold the refund proceeds
          received under the Joint Refund Application in a
          segregated interest-bearing account, and may not use
          the funds for any purpose.

      (6) Unless any party commences any litigative matter
          within 30 days of the receipt of the refund proceeds
          contesting Copperweld's right to retain the refund
          proceeds, or all of the parties agree, the refund
          proceeds shall be deemed to be the property of
          Copperweld Corporation and will not be subject to any
          claim by any Debtor or other entity, and Copperweld
          will no longer be required to segregate and hold the
          funds, but may use the funds for general business
          purposes.

      (7) If a litigative matter is timely commenced, then
          Copperweld will continue to hold all refund proceeds
          in the segregated, interest-bearing account and will
          not use the funds for any purpose until a court
          determines the entitlement to the proceeds.

      (8) In the event a litigative matter is timely begun,
          the filing of the Joint Refund Application and the
          receipt of the proceeds by Copperweld will not
          prejudice the rights, if any, of any party to claim or
          assert that a Debtor other than Copperweld is entitled
          to receive or recoup proceeds, nor prejudice the
          rights of Copperweld to reject any contract that may
          give rise to such a claim. (LTV Bankruptcy News, Issue
          No. 43; Bankruptcy Creditors' Service, Inc., 609/392-
          00900)


LUCENT: Teams Up with Iusacell for Mexico's 3-G Mobile Network
--------------------------------------------------------------
Grupo Iusacell, S.A. de C.V. (NYSE: CEL; BMV: CEL), a leading
digital wireless telecommunications operator in Mexico,
announced the commercial launch of the country's first CDMA2000
1X voice and high-speed data network using equipment, software
and services from Lucent Technologies (NYSE: LU).

With this third-generation (3G) network, Iusacell can
significantly increase its voice capacity and offer subscribers
new data services such as high-speed instant messaging, e-mail
and Internet access at speeds of up to 144 kilobits per second
(kbps).  Iusacell also will be able to offer enterprises mobile
office capabilities and applications designed to meet the needs
of specific mobile users such as field sales and service
personnel.

"We are extremely pleased to be able to provide our customers
with the first major high-speed wireless data service in
Mexico," said Carlos Espinal, CEO of Iusacell. "The new 3G
CDMA2000 network launched [Friday last week] will enable us to
efficiently increase our voice capacity and introduce compelling
new services to our high-value customers."

Lucent upgraded Iusacell's existing Lucent-supplied base
stations with CDMA2000 1X channel cards and software, and also
provided software upgrades for Iusacell's mobile switching
centers to enable these advanced services. Lucent also supplied
its NavisRadius(TM) 4.0 AAA (authentication, authorization and
accounting) server software to manage secure network access and
usage.  Lucent Worldwide Services performed installation and
integration services for the CDMA2000 1X network.

"We are proud to work with Iusacell as they remain at the
forefront of mobile communications in Mexico by launching this
3G network," said Victor Agnellini, vice president of mobility
sales, Lucent Technologies Latin America.  "While providing
Iusacell with significant investment protection by taking
advantage of its existing infrastructure and radio frequency
spectrum at 850 MHz, our 3G CDMA2000 solutions allow Iusacell to
deliver high-speed data capabilities to businesses and
consumers."

Iusacell subscribers in Mexico will be able to access the high-
speed network with CDMA2000 1X-enabled devices or personal
digital assistants and laptop PCs equipped with CDMA2000 1X PC
cards.

CDMA2000 is an advanced and efficient wireless technology being
introduced worldwide and an international 3G standard
established by the International Telecommunications Union.
CDMA2000 cost-effectively evolves a multitude of network
technologies to support 3G services.

Lucent's Mobility Solutions Group is a leading global provider
of mobile networking technologies, having deployed more than
70,000 spread-spectrum base stations for mobile operators
worldwide.

Grupo Iusacell, S.A. de C.V. (Iusacell, NYSE: CEL; BMV: CEL) is
a wireless cellular and PCS service provider in seven of
Mexico's nine regions, including Mexico City, Guadalajara,
Monterrey, Tijuana, Acapulco, Puebla, Leon and Merida.  The
Company's service regions encompass a total of approximately 91
million POPs, representing approximately 90% of the country's
total population.  Iusacell is under the management and
operating control of subsidiaries of Verizon Communications Inc.
(NYSE: VZ).

Lucent Technologies, headquartered in Murray Hill, N.J., USA,
designs and delivers networks for the world's largest
communications service providers. Backed by Bell Labs research
and development, Lucent relies on its strengths in mobility,
optical, data and voice networking technologies as well as
software and services to develop next-generation networks.  The
company's systems, services and software are designed to help
customers quickly deploy and better manage their networks and
create new, revenue-generating services that help businesses and
consumers.  For more information on Lucent Technologies, visit
its Web site at http://www.lucent.com

Lucent Technologies' 7.70% bonds due 2010 (LU10USR1) are trading
at about 32 cents-on-the-dollar, DebtTraders reports. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=LU10USR1for
real-time bond pricing.


LYNX THERAPEUTICS: Initiates 2% Total Workforce Reduction
---------------------------------------------------------
Lynx Therapeutics, Inc., (Nasdaq: LYNXD) announced a reduction
of approximately 25% in its workforce.  With the workforce
reduction, Lynx's total company headcount will number
approximately 90 people. The groups affected primarily by this
action include research and development personnel based in
Heidelberg, Germany, and those working in Lynx's proteomics
group in California. The workforce reduction is intended to
focus Lynx's financial and human resources on expanding the
commercial use of its genomics analysis technology, Massively
Parallel Signature Sequencing, or MPSS(TM), which provides
comprehensive and quantitative digital gene expression
information important to modern systems biology research in the
pharmaceutical, biotechnology and agricultural industries.

"We recognize and thank our former employees for their
contributions," said Kevin P. Corcoran, President and Chief
Executive Officer of Lynx. "Our business strategy will focus on
MPSS(TM), our product that currently generates revenues for us
primarily through genomics discovery services for our customers.
We believe that MPSS(TM) can achieve greater market penetration
and a much higher level of commercial success.  Additionally, we
believe that the cost savings to be derived from a smaller, more
focused workforce should help us in achieving our financial
goals."

Mr. Corcoran continued, "At this point, given the growing
interest in MPSS(TM) and our immediately available resources, we
made a decision to discontinue our internal proteomics
development efforts.  We recognize Protein ProFiler(TM) as a
potentially valuable asset, but are not in a position at this
time to make any further development investment in this
project."

Lynx is a leader in the development and application of novel
genomics analysis solutions that provide comprehensive and
quantitative digital gene expression information important to
modern systems biology research in the pharmaceutical,
biotechnology and agricultural industries.  These solutions are
based on Megaclone(TM) and MPSS(TM), Lynx's unique and
proprietary cloning and sequencing technologies.  For more
information, visit Lynx's Web site at http://www.lynxgen.com

                          *     *     *

In its SEC Form 10-Q filed on November 13, 2002, the Company
stated:

"We have a history of net losses, and we may not achieve or
maintain profitability.

"We have incurred net losses each year since our inception in
1992, including net losses of approximately $6.7 million in
1999, $13.3 million in 2000 and $16.7 million in 2001. As of
September 30, 2002, we had an accumulated deficit of
approximately $95.9 million. Future net losses or profits will
depend, in part, on the rate of growth, if any, in our revenues
and on the level of our expenses. Our research and development
expenditures and general and administrative costs have exceeded
our revenues to date. Research and development expenses may
increase due to planned spending for ongoing technology
development and implementation, as well as new applications. As
a result, we will need to generate significant additional
revenues to achieve profitability. Even if we do increase our
revenues and achieve profitability, we may not be able to
sustain profitability.

"Our ability to generate revenues and achieve profitability
depends on many factors, including:

        -- our ability to continue existing customer
           relationships and enter into additional corporate
           collaborations and agreements;

        -- our ability to discover genes and targets for drug
           discovery;

        -- our ability to expand the scope of our research into
           new areas of pharmaceutical, biotechnology and
           agricultural research;

        -- our collaborators' ability to develop diagnostic and
           therapeutic products from our drug discovery targets;
           and

        -- the successful clinical testing, regulatory approval
           and commercialization of such products.

"The time required to reach profitability is highly uncertain.
We may not achieve profitability on a sustained basis, if at
all.

"We will need additional funds in the future, which may not be
available to us.

"We have invested significant capital in our scientific and
business development activities. Our future capital requirements
will be substantial if we expand our operations and will depend
on many factors, including:

        -- the progress and scope of our collaborative and
           independent research and development projects;

        -- payments received under agreements with customers,
           collaborators and licensees;

        -- our ability to establish and maintain arrangements
           with customers, collaborators and licensees;

        -- the progress of the development and commercialization
           efforts under our collaborations and corporate
           agreements;

        -- the costs associated with obtaining access to samples
           and related information; and

        -- the costs involved in preparing, filing, prosecuting,
           maintaining and enforcing patent claims and other
           intellectual property rights.

"We anticipate that our current cash and cash equivalents,
short-term investments and funding to be received from
customers, collaborators and licensees will enable us to
maintain our currently planned operations for at least the next
12 months. Changes to our current operating plan may require us
to consume available capital resources significantly sooner than
we expect. If our capital resources are insufficient to meet
future capital requirements, we will have to raise additional
funds. We do not know if we will be able to raise sufficient
additional capital on acceptable terms, or at all. If we raise
additional capital by issuing equity or convertible debt
securities, our existing stockholders may experience substantial
dilution. If we fail to obtain adequate funds on reasonable
terms, we may have to curtail operations significantly or obtain
funds by entering into financing or collaborative agreements on
unattractive terms."


LYONDELL CHEMICAL: Reports 2003 Capital Expenditure Budget
----------------------------------------------------------
Lyondell Chemical Company (NYSE: LYO) announced the 2003 capital
expenditure budget for Lyondell and its ventures, Equistar
Chemicals, LP, and LYONDELL-CITGO Refining LP.

"Lyondell's 2003 capital budget reflects spending priorities
consistent with our long-term strategy," said Lyondell President
and CEO Dan F. Smith. "We will invest where we have sustainable
competitive advantage by completing our investment in the new
propylene oxide plant in Rotterdam (PO-11) owned by our joint
venture with Bayer.  We also will spend the funds necessary to
maintain our facilities for the long term and to advance
required environmental compliance spending programs."

Spending in Intermediate Chemicals and Derivatives (IC&D) will
increase over 2002 levels as a result of the timing of
contributions to the PO-11 project, which is expected to be
completed in the second half of 2003. Additionally there have
been timing changes that have shifted some spending from 2002
into 2003.  Lyondell's estimated capital spending on the PO-11
project in 2002 was $55 million.  In 2003, Lyondell plans to
spend $70 million on PO-11.

Equistar's 2002 estimated capital expenditures include $47
million related to the expiration of railcar leases.  Equistar
may pursue leases for a portion of these railcars.  Excluding
this item, increases in Equistar's capital program in 2003
result from spending to ensure regulatory and environmental
compliance.  Lyondell estimates that its proportionate share of
Equistar's 2003 capital budget will be approximately $68
million.

Lyondell's 2003 contribution to support LCR's capital spending
is currently expected to be approximately $42 million.

Lyondell Chemical Company -- http://www.lyondell.com--
headquartered in Houston, Texas, is a leading producer of
propylene oxide, propylene glycol and other PO derivatives such
as butanediol and propylene glycol ether.  Lyondell also is the
world's number three supplier of toluene diisocyanate and a
producer of styrene monomer and MTBE as co-products of PO
production.  Through its 70.5% interest in Equistar Chemicals,
LP, Lyondell also is one of the largest producers of ethylene,
propylene and polyethylene in North America, as well as a
leading producer of polypropylene, ethylene oxide, ethylene
glycol, high value-added specialty polymers and polymeric
powder.  Through its 58.75% interest in LYONDELL-CITGO Refining
LP, Lyondell is one of the largest refiners in the United
States, processing extra heavy Venezuelan crude oil to produce
gasoline, low sulfur diesel and jet fuel.

As reported in Troubled Company Reporter earlier this month,
Standard & Poor's 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, 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.


MATLACK SYSTEMS: Ch. 7 Trustee Taps Palmer Biezup as Co-Counsel
---------------------------------------------------------------
Gary F. Seitz, Esq., the Chapter 7 Trustee for Matlack Systems,
Inc., and its debtor-affiliates, asks for permission from the
U.S. Bankruptcy Court for the District of Delaware to hire
Palmer Biezup & Henderson, LLP, as Co-Counsel, nunc pro tunc to
November 8, 2002.

Palmer Biezup will:

      (a) provide legal advice with respect to the Chapter 7
          Trustee's powers and duties under the Bankruptcy Code;

      (b) assist in the investigation of the Debtors' acts,
          conduct, assets, liabilities, and financial condition,
          the operation of the Debtors' businesses, and any other
          matters relevant to the case or to the orderly
          liquidation of the estates' assets;

      (c) prepare, on behalf of the Chapter 7 Trustee,
          necessary applications, motions, complaints, answers,
          orders, agreements and other legal papers;

      (d) review, analyze and respond to all pleadings
          filed in these chapter 7 cases and appear in court
          to present necessary motions, applications and
          pleadings and to otherwise protect the interests of the
          Chapter 7 Trustee and the Debtors' estates; and

      (e) perform all other legal services for the Chapter 7
          Trustee that may be necessary and proper in these
          proceedings.

The Chapter 7 Trustee assures the Court that he will work
closely with Palmer Biezup and co-counsel to ensure that there
is no unnecessary duplication of services performed or charged
to the Debtors' estates.

Palmer Biezup's hourly rates are:

           attorneys       $175 to $300 per hour
           paralegals      $ 80 to $ 95 per hour

Before filing for chapter 11 protection, Matlack Systems, Inc.,
North America's No. 3 tank truck company, provides liquid and
dry bulk transportation, primarily for the chemicals industry.
The Debtors converted their chapter 11 cases under Chapter 7
Liquidation of the U.S. Bankruptcy Code on October 18, 2002.
Richard Scott Cobb, Esq., at Klett Rooney Lieber & Schorling,
represents the Debtors.


MEMC ELECTRONIC: Narrows Net Capital Deficit to $22MM at Dec. 31
----------------------------------------------------------------
MEMC Electronic Materials, Inc., (NYSE: WFR) reported financial
results for the fourth quarter and year ended December 31, 2002.

Summary of the fourth quarter results:

* Net sales of $186.0 million
* Gross margin of 29% of net sales
* Operating income of $32.1 million (17% of net sales)
* Net income of $35.7 million and basic EPS of $0.18

Commenting on the quarterly results, Nabeel Gareeb, MEMC's Chief
Executive Officer, said:

"We are extremely pleased to report continued sequential
improvement in our operating results. As we had anticipated, our
sales contracted slightly this quarter relative to the 2002
third quarter as a result of industry market conditions. Even
with the slight decline in net sales, we were able to achieve
improvement in both our gross margin and our operating margin
compared to last quarter. These improvements are a testament to
the hard work of all our employees worldwide and the loyalty of
our customers. This clearly demonstrates that we have continued
the relentless march towards our long-term business model."

                     Fourth Quarter Results

Net sales were $186.0 million for the fourth quarter ended
December 31, 2002 compared to $190.3 million for the 2002 third
quarter.

The Company reported gross margin in the 2002 fourth quarter of
$54.1 million, or 29% of net sales, compared to $52.8 million,
or 28% of net sales, in the 2002 third quarter. The Company
reported operating income of $32.1 million, or 17% of net sales
in the fourth quarter of 2002, compared to operating income of
$21.8 million, or 11% of net sales for the third quarter of
2002. Excluding restructuring charges, operating income in the
2002 third quarter would have been $30.1 million, or 16% of net
sales.

The Company reported net income allocable to common stockholders
of $35.7 million for the 2002 fourth quarter, compared to a net
loss allocable to common stockholders of $45.7 million in the
2002 third quarter. Excluding a $7.5 million one-time gain from
the option on MEMC Pasadena, the Company's earnings per basic
share in the 2002 fourth quarter would have been $0.14.

Interest expense decreased from $58.3 million in the 2002 third
quarter to $4.2 million in the 2002 fourth quarter. As
previously reported, interest expense in the 2002 third quarter
included non-cash accretion of approximately $53.4 million
related to a 55 million Euro note that matured in September
2002.

Other, net in the 2002 fourth quarter included a $7.5 million
one-time gain on an option on MEMC Pasadena, Inc., which expired
October 31, 2002. In addition, currency gains in the 2002 fourth
quarter totaled $4.5 million compared to a $2.9 million currency
loss in the 2002 third quarter.

The Company achieved operating cash flow of $42.6 million for
the 2002 fourth quarter, a 17% increase, compared to $36.5
million in the 2002 third quarter. Free cash flow, which is
operating cash flow after capital expenditures, was $32.9
million for the 2002 fourth quarter compared to $31.3 million in
the 2002 third quarter. Capital expenditures during the 2002
fourth quarter totaled $9.6 million compared to $5.2 million in
the 2002 third quarter. Depreciation and amortization in the
2002 fourth quarter totaled $9.0 million compared to $8.4
million in the 2002 third quarter.

The Company's effective income tax rate for the 2002 fourth
quarter was 8%. Going forward, the Company expects its effective
income tax rate will be approximately 30%.

                             Outlook

"Looking forward, based on current industry market conditions,
we expect our net sales in the 2003 first quarter to be
approximately flat compared to the 2002 fourth quarter. We
anticipate our gross margin and operating margin as a percentage
of sales will be approximately flat in the 2003 first quarter
compared to the 2002 fourth quarter as the pricing contracts
that are effective on January 1, 2003 offset expected cost
reductions in the 2003 first quarter," continued Gareeb.

"At this point, we are introducing operating cash flow as
another element of our long-term steady-state model.
Specifically, our target is to generate operating cash flow at a
rate of greater than 20 percent of net sales and free cash flow,
which is operating cash flow after capital expenditures, of
approximately 5 to 10 percent of net sales. Our objective is to
use this free cash flow to reduce our debt and to continue to
strengthen our balance sheet. This will allow us to achieve our
long-term objective of being self-funding."

                          2002 Results

For the year ended December 31, 2002, the Company's net sales
increased 11% to $687.2 million compared to $617.9 million in
2001. Gross margin increased to $173.5 million or 25% of net
sales compared to negative $51.5 million or negative 8% of net
sales in 2001. The improvement in gross margin was due to lower
depreciation and amortization resulting from push down
accounting, as well as the benefits realized from headcount
reductions and yield and productivity improvements in 2002,
partially offset by declines in average selling prices in 2002
compared to the first nine months of 2001.

The Company reported a net loss allocable to common stockholders
of $22.1 million for the year ended December 31, 2002, compared
to a net loss allocable to common stockholders of $522.7 million
in 2001. Excluding the non-cash interest accretion of
approximately $54.0 million related to a 55 million Euro note
recognized in 2002 and the $7.5 million one-time gain on the
option on MEMC Pasadena recognized in the 2002 fourth quarter,
net income available to common stockholders would have been
$24.4 million for the year ended December 31, 2002.

The Company generated $86.7 million of cash from operations for
the year ended December 31, 2002 compared to $24.6 million of
cash used in operations in the prior year. The improved cash
flow was primarily a result of the improved operating results
and cash cost reductions. Capital expenditures in 2002 totaled
$22.0 million compared to $49.8 million in 2001. Depreciation
and amortization totaled $34.2 million for the year ended
December 31, 2002 compared to $174.6 million in 2001. The
decrease in depreciation and amortization was primarily the
result of the application of push-down accounting.

Other, net in 2002 included a $7.5 million one-time gain on an
option on MEMC Pasadena, Inc., which expired October 31, 2002.
In addition, currency gains in 2002 totaled $11.2 million
compared to currency losses of $3.5 million in 2001.

The analysis of the Company's annual operating results utilizes
combined information for the year ended December 31, 2001. The
Company's assets and liabilities were adjusted to reflect a new
basis resulting from push-down accounting as of November 13,
2001, following the acquisition by the investor group led by
Texas Pacific Group of E.ON's equity and debt interests in MEMC.
The combined information consists of the sum of the financial
data from January 1, 2001 through November 13, 2001 for the
predecessor and from November 14, 2001 through December 31, 2001
for the successor to obtain the annual data for 2001. The
comparability of the Company's operating results for the periods
prior to and following push down accounting is affected by the
purchase accounting adjustments.

The Company's December 31, 2002 balance sheet shows a total
shareholders' equity deficit of about $22 million.

MEMC is a leading worldwide producer of silicon wafers for the
semiconductor industry. Silicon wafers are the fundamental
building block from which almost all semiconductor devices are
manufactured, such as are used in computers, mobile electronic
devices, automobiles, and other consumer and industrial
products. Headquartered in St. Peters, MO, MEMC operates
manufacturing facilities directly in every major semiconductor
manufacturing region throughout the world, including Europe,
Japan, Malaysia, South Korea, and the United States and through
a joint venture in Taiwan.


MERRY-GO-ROUND: Chapter 7 Prepares to Make 30% Distribution
-----------------------------------------------------------
Deborah H. Devan, the Chapter 7 Trustee, overseeing Merry-Go-
Round Enterprises, Inc., and its debtor-affiliates' liquidation
proceedings, filed the "Trustee's Proposed Distribution to
Allowed Unsecured Priority Creditors and Interim Distribution to
General Unsecured Creditors" in the U.S. Bankruptcy Court for
the District of Maryland.

The Distribution Report is on file in the Office of the Clerk of
the Bankruptcy Court for inspection by any interested party and
electronic access is available at http://www.mgre.net

Ms. Devan proposes to distribute $78,000,000 to Merry-Go-Round's
prepetition unsecured creditors -- about 30-cents-on-the-dollar.
After the Distribution, Ms. Devan will continue to hold
approximately $37 million in cash.

Any objections or responses to the Distribution Report must be
submitted to the Court on or before Feb. 12, 2003, and a copy of
the objection must be served upon:

           Counsel to the Chapter 7 Trustee
           Jonathan Lipshie, Esq.
           Neuberger, Quinn, Gielen, Rubin & Gibber, P.A.
           One South Street, 27th Floor
           Baltimore, Maryland 21202-3282
           Tel: 410-332-8550

A hearing on the matters will be held on February 25, 2003, at
2:00 p.m.

Merry-Go-Round filed for chapter 11 bankruptcy protection in
1994.  Following a couple of failed attempts to find its place
on the retail landscape, the case converted to a chapter 7
liquidation in early 1996.  Since that time, Ms. Devan has
worked on winding-up the Debtors' estates.  Jonathan W.
Lipshire, Esq., at Neuberger, Quinn, Gielen, Rubin & Gibber,
P.A., represents Ms. Devan.


METROMEDIA: Takes Action to Keep Network Free of Global Worm
------------------------------------------------------------
Metromedia Fiber Network, leading provider of optical
communications infrastructure solutions, confirmed that early
identification and quick actions kept its network unaffected
during global Denial of Service attack on the Internet. MFN
customers experienced no service interruptions during the
attack. In addition, the actions taken by MFN contributed to
containing the attack, saving numerous other networks.

Early Saturday morning, a Denial of Service attack crippled many
of the world's top network providers by flooding the Internet
with traffic that was specifically designed to tie up servers
with fake data exchanges making it impossible for real
transmissions to travel over the network. MFN engineers, who
continuously monitor its global IP network, were able to quickly
identify an unusual traffic pattern. At 12:30 am on Saturday
morning, when traffic volumes are normally declining from peak
usage hours, traffic volumes began rising exponentially
indicating a DOS attack. MFN responded quickly and effectively
to secure its network and MFN customers experienced no service
interruptions.

"MFN quickly assembled a critical response team that included IP
Network Engineers, Information Security experts, and Customer
Service specialists," according to Bill LaPerch, Senior Vice
President MFN Network Services. "The critical response team
implemented traffic filters on the MFN backbone that secured our
network, protected all our customers and stopped the Denial of
Service attack from using the MFN network to reach other
networks."

By morning, MFN had intercepted and discarded over 2.4 Terabytes
of worm-generated traffic. With the filters in place, no
additional attacks from this Denial of Service on MFN customers
can occur from outside the MFN network.

MFN is the leading provider of optical communications
infrastructure solutions. The Company combines the most
extensive metropolitan area fiber network with a global optical
IP network, state-of-the-art data centers and award winning
managed services to deliver fully integrated, outsourced
communications solutions to high-end companies. The all-fiber
infrastructure enables MFN customers to share vast amounts of
information internally and externally over private networks and
a global IP backbone, creating collaborative businesses that
communicate at the speed of light.

PAIX.net, Inc., a subsidiary of MFN and the original neutral
Internet exchange, offers secure, Class A co-location facilities
where ISPs and other Internet-centric companies can form public
and private peering relationships with each other, and have
access to multiple telecommunications carriers for circuits
within each facility.

On May 20, 2002, Metromedia Fiber Network, Inc., and most of its
domestic subsidiaries commenced voluntary Chapter 11 cases in
the United States Bankruptcy Court for the Southern District of
New York. For more information on MFN, visit the Company's Web
site at http://www.mfn.com

Metromedia Fiber Network's 10% bonds due 2008 (MFNX08USR1) are
trading at about 3 cents-on-the-dollar, says DebtTraders. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=MFNX08USR1
for real-time bond pricing.


ML CBO VI: S&P Keeps Watch on CCC+ Ser. 1996-C-2 Class A Rating
---------------------------------------------------------------
Standard & Poor's Ratings Services placed its rating on class A
notes issued by ML CBO VI 1996-C-2, an arbitrage CBO transaction
originated in October 1996, on CreditWatch with negative
implications. The rating had previously been lowered in March
2002.

The CreditWatch placement reflects factors that have negatively
affected the credit enhancement available to support the notes
since March 2002. These factors include continuing par erosion
of the collateral pool securing the rated notes, a decline in
the interest from the collateral pool available for hedge and
interest payments on the liabilities, and a negative migration
in the credit quality of the performing assets in the pool.

The transaction experienced $ 12.25 million worth of defaults
since March 2002. Standard & Poor's noted that as a result of
asset defaults, the overcollateralization ratios for the
transaction have suffered. According to the most recent trustee
report (January 2003), the class A overcollateralization is at
96.9% versus the required ratio of 120%, and compared to a ratio
of 99.3% in March 2002.

According to the January trustee report, the weighted average
coupon has deteriorated to 10.57%, versus the minimum required
weighted average coupon of 10.8% and a weighted average coupon
of 10.88% in March 2002. The deal continues to fail all of the
Standard & Poor's issuer rating distribution tests according to
the January trustee report.

Standard & Poor's will be reviewing the results of current cash
flow runs generated for ML CBO VI 1996 C-2 to determine the
level of future defaults the rated class can withstand under
various stressed default timing and interest rate scenarios,
while still paying all of the interest and principal due on the
notes. The results of these cash flow runs will be compared with
the projected default performance of the performing assets in
the collateral pool to determine whether the ratings currently
assigned to the notes remain consistent with the credit
enhancement available.

              Rating Placed on Creditwatch Negative

                     ML CBO VI 1996-C-2

                      Rating
      Class    To                From     Current Bal. (Mil. $)
      A      CCC+/Watch Neg      CCC+     66.81


MORTGAGE CAPITAL: Fitch Hatchets & Affirms Low-B & Junk Ratings
---------------------------------------------------------------
Mortgage Capital Funding, Inc.'s commercial mortgage pass-
through certificates, series 1998-MC2 $15.1 million class J is
downgraded to 'B-' from 'B' and $7.6 million class K to 'CCC'
from 'B-' by Fitch Ratings. In addition, Fitch affirms the
following classes: $102.1 million class A-1, $514.2 million
class A-2, and interest-only class X at 'AAA'; $48 million class
B at 'AA'; $58 million class C at 'A'; $60.6 million class D at
'BBB'; $37.9 million class E at 'BBB-'; $12.6 million class F at
'BB+'; $25.2 million class G at 'BB'; and $7.6 million class H
at 'BB-'.

The actions reflect the weakening of the transaction following
Kmart's Jan. 14, 2003 announcement to close an additional 326
stores of which one is in this deal. In addition, there are
other loans of concern which when combined with the new store
closing necessitate the downgrades. The transaction contains
three loans in which there is or had been Kmart exposure,
representing 2.3% of the transaction by loan balance. The loan
with the newly announced store closing represents 1.03% of the
transaction.

Fitch has identified other loans of concern (1.71%) in the pool.
There are five loans in special servicing of which four are
considered to be of concern. The first loan is secured by a
retail property located in San Antonio, Texas. The borrower
filed for bankruptcy the day before the foreclosure sale. The
second loan is secured by two vacant industrial properties. The
third loan is secured by retail center in Brooklyn, New York.
The loan was transferred to the special servicer because of a
payment default. The final loan was transferred to the special
servicer in January 2003 due to a non-monetary default.

Fitch will continue to monitor the status of the loan with newly
announced Kmart closing and the impact on the ratings in this
transaction.


NAT'L CENTURY: Court Appoints Logan as Claims & Noticing Agent
--------------------------------------------------------------
National Century Financial Enterprises, Inc., and its debtor-
affiliates obtained Judge Calhoun's permission to appoint Logan
& Company, Inc., as claims and processing and noticing agent in
these Chapter 11 cases.

Logan & Company, Inc., is a data processing firm that
specializes in claims processing, noticing and other
administrative tasks in bankruptcy cases.  Logan has provided
identical or similar services in other large bankruptcy cases
across the country and is very well qualified to serve as the
National Century Financial Enterprises, Inc., and its
debtor-affiliates' Claims and Noticing Agent in their bankruptcy
cases.

Following Court appointment, Logan will perform these services
for the Debtors' bankruptcy cases:

    (a) prepare and serve required notices to include:

        -- notice of the commencement of these Chapter 11 cases
           and the initial meeting of creditors under Section
           341(a) of the Bankruptcy Code;

        -- notice of any claims bar date;

        -- notice of objections to claims;

        -- notice of any hearings on a disclosure statement and
           confirmation of a plan of reorganization; and

        -- notices as the Debtors or the Court may deem necessary
           for an orderly administration;

    (b) maintain copies of all Proofs of Claim and Proofs of
        Interest filed;

    (c) implement necessary security measures to ensure the
        completeness and integrity of the claims registers;

    (d) maintain an up-to-date mailing list for all entities that
        have filed Proofs of Claim, Proofs of Interest or Notices
        of Appearance;

    (e) provide access to the public for examination of copies of
        the Proofs of Claim or Proof of Interest filed without
        charge during business hours;

    (f) record all transfers of claims and provide notice of the
        transfers pursuant to Rule 3001(e) of the Federal Rules
        of Bankruptcy Procedure;

    (g) provide temporary employees to process claims, as
        necessary;

    (h) promptly comply with conditions and requirements as the
        Clerk's Office or the Court may prescribe at any time;
        and

    (i) provide other claims processing, noticing and related
        administrative services as may be requested from time to
        time by the Debtors.

Logan will assist the Debtors with:

    -- the preparation of their schedules of assets and
       liabilities;

    -- the reconciliation of financial affairs and master
       creditor lists and any amendments to it;

    -- the reconciliation and resolution of claims;

    -- the preparation, marking and tabulation of ballots and
       other related services for voting to accept or reject a
       Plan of Reorganization; and

    -- technical support. (National Century Bankruptcy News,
       Issue No. 5; Bankruptcy Creditors' Service, Inc., 609/392-
       0900)


NETIA HOLDINGS: Gets Nod to Re-List on Nasdaq SmallCap Market
-------------------------------------------------------------
Netia Holdings S.A. (WSE: NET), Poland's largest alternative
provider of fixed-line telecommunications services, announced
that following Netia's appeal, the Nasdaq Listing and Hearing
Review Council reversed an earlier decision of the Nasdaq
Listing Qualifications Panel, dated October 14, 2002, to de-list
Netia's American Depositary Shares from The Nasdaq National
Market. The Listing Council's decision was based on positive
events occurring after the de-listing decision. The Listing
Council instructed the Panel to re-list Netia's ADSs on The
Nasdaq SmallCap Market upon completion of a review of Netia's
application. Netia's Management Board has decided to file such
application, which will be subject to the approval of the Nasdaq
Listing Qualifications Department.

Wojciech Madalski, Netia's President and Chief Executive Officer
commented:

"We welcome Nasdaq's favorable decision regarding the earlier
de-listing of Netia's ADSs. Netia demonstrates continued
progress as Poland's largest alternative telecommunications
company. We are growing our services focused on business
customers in Poland's twelve largest cities. Netia's capital
restructuring provides a solid financial basis for the company's
future. We believe that Nasdaq's decision reflects these
positive developments, and we look forward to the commencement
of trading on the Nasdaq SmallCap Market following the review of
our application by the Nasdaq Listing Qualifications
Department."

Avi Hochman, Netia's Chief Financial Officer, added:

"The financial restructuring of Netia has reached its final
stage following the issuance of the new notes and series H
shares. We are awaiting registration of series H shares by the
Polish courts in order to begin trading on the Warsaw Stock
Exchange. Commencement of public trading of series H shares and
possible re-listing on Nasdaq will improve Netia's global
liquidity."

Netia Holdings SA's 13.500% bonds due 2009 (NETH09NLN2) are
trading at about 17 cents-on-the-dollar, says DebtTraders. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=NETH09NLN2
for real-time bond pricing.


NORTHWESTERN CORP: Wins Nod for First Mortgage Bonds Issuance
-------------------------------------------------------------
NorthWestern Corporation (NYSE: NOR) reported that the Montana
Public Service Commission approved the company's issuance of
First Mortgage Bonds to secure a $390 million senior secured
term loan credit facility with Credit Suisse First Boston. The
company received the commission's final order Monday and has now
received all required regulatory approvals to close the
financing.

The new facility matures in December 2006 and will be used to
repay NorthWestern's existing $280 million working capital
facility and for other corporate purposes. The closing and
funding of the facility is expected to be completed by Feb. 10,
2003.

NorthWestern Corporation is a leading provider of services and
solutions to more than 2 million customers across America.
NorthWestern's partner businesses include NorthWestern Energy, a
provider of electricity, natural gas and related services to
customers in Montana, Nebraska and South Dakota; Expanets, the
largest mid-market provider of networked communications
solutions and services in the United States; and Blue Dot, a
leading provider of air conditioning, heating, plumbing and
related services.

As reported in Troubled Company Reporter's January 20, 2003
edition, Northwestern Corp.'s outstanding credit ratings have
been downgraded by Fitch Ratings as follows: senior secured debt
to 'BBB-' from 'BBB+'; senior unsecured notes and pollution
control bonds to 'BB+' from 'BBB' and trust preferred securities
and preferred stock to 'BB' from 'BBB-'. The ratings are removed
from Rating Watch Negative where they were placed on Dec. 13,
2002. The Rating Outlook is Negative. Approximately $1.5 billion
of securities are affected.

The rating action follows Fitch's review of NOR's current and
prospective credit profile including the impact of lower
earnings expectations and anticipated non-cash charges during
the fourth quarter of 2002 at NOR's two primary non-utility
businesses - Expanets (communications solutions) and Blue Dot
(HVAC services). The revised rating levels also take into
consideration NOR's recent execution of a new $390 million five
year secured term loan facility, the proceeds of which will
become available to NOR upon approval of the financing by the
Montana Public Service Commission (expected by early February
2003).

Northwestern Corp.'s 6.950% bonds due 2028 are currently trading
at about 72 cents-on-the-dollar.


OWENS CORNING: Wants More Time to File Disclosure Statement
-----------------------------------------------------------
Owens Corning and its debtor-affiliates ask the Court to extend
through March 14, 2003 the time imposed by Rule 3016(b) of the
Federal Rules of Bankruptcy Procedures for the Debtors to file a
disclosure statement with respect to their Plan.

Bankruptcy Rule 3016(b) provides that "[i]n a chapter 9 or 11
case, a disclosure statement under  1125 or evidence showing
compliance with  1126(b) of the Code shall be filed with the
plan or within a time fixed by the court."

J. Kate Stickles, Esq., at Saul Ewing LLP, in Wilmington,
Delaware, notes that these are difficult cases.  With the
assistance of the Court, Judge Wolin and Francis J. McGovern,
the Court-appointed mediator, the Debtors have engaged in
numerous discussions with various of their primary creditor
constituencies and their advisors in an attempt to develop a
consensual plan of reorganization.  Although significant
progress has been made on some matters, certain of the parties
remain far apart on several primary issues, among others:

     -- the Debtors' aggregate asbestos liability;

     -- the recovery the Debtors' prepetition bank group should
        receive on account of their guarantees from certain
        Debtors and non-Debtor affiliates; and

     -- whether some or all of the Debtors' estates should be
        substantively consolidated.

In large part, the resolution of these issues will dictate the
creditors' relative financial recoveries in these cases.

In recent months, the Debtors' cases have proceeded on several
parallel tracks:

     -- settlement discussions and mediation;

     -- litigation, in which a joint trial on the Banks' guaranty
        adversary action and a hearing on substantive
        consolidation is scheduled to commence before Judge Wolin
        on April 1, 2003; and

     -- plan preparation, negotiation, and drafting, due to the
        expiration of the Debtors' exclusive period for filing a
        plan, pursuant to Section 1121 of the Bankruptcy Code, on
        January 17, 2003.

Given the efforts involved in finalizing the Plan, and because
of the Debtors' simultaneous preparation for litigation
commencing on April 1, 2003, Ms. Stickles informs the Court that
a disclosure statement with respect to the Plan has not yet been
completed.  Although the Debtors could file an incomplete
disclosure statement now, the Debtors believe that the approval
process for a disclosure statement will be significantly more
efficient if the Debtors are granted additional time to file the
disclosure statement so as to ensure that the disclosure
statement contains the adequate information required by Section
1125 of the Bankruptcy Code.

The Court will convene a hearing on February 24, 2003 to
consider the Debtors' request.  By application of Del.Bankr.LR
9006-2, the deadline to file the Disclosure Statement is
automatically extended through the conclusion of that hearing.
(Owens Corning Bankruptcy News, Issue No. 44; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


PALADYNE CORP: Independent Auditors Express Going Concern Doubt
---------------------------------------------------------------
Paladyne Corp., through a wholly-owned subsidiary, e-commerce
support centers, inc., provides customer relationship management
solutions at its customer contact center in Jacksonville, NC.
Since the February 2001 merger with e-commerce support centers,
inc., Paladyne Corp., has provided this CRM-based customer and
tech support, and outbound telemarketing for business-to-
business and business-to-customer needs.

The Company's independent accountant's report contained a going
concern qualification for the year ended August 31, 2002.

Paladyne's revenue for the three months ended November 30, 2002
and 2001 were $2,475,050, and $2,440,276, respectively; this
represents an increase of 1.4% in sales. All of these revenues
were derived entirely from the Company's CRM-based customer and
tech support, and outbound telemarketing for business-to-
business to business-to-customer operations. This slight
increase is attributable to increased traditional outbound
calling contracts and a reduction in revenue from the Company's
inbound or non-traditional outbound contracts. Two customers,
Gibralter Publishing, Inc. and Lowes Home Improvement accounted
for a decline of $105,208 and $408,291, respectively during the
three-month period ended November 30, 2002 compared to the same
period in 2001.

Cost of revenues of $1,426,876 and $1,316,794, respectively for
the three months ended November 30, 2002 and 2001 were 57.7% and
53.9% of revenue for the periods. The increase in cost of sales
of $110,082, or 8.3%, from 2001 to 2002 is attributable to
slightly higher supervisory costs associated with contracts that
comprise revenue during the three months ended November 30, 2002
compared to 2001. Gross profit was $1,048,174 and $1,123,482,
respectively for the three months ended November 30,2002 and
2001, and was 42.3% and 46.1% of revenue for the periods. The
decrease in gross profit percentage is due to the slightly
higher costs associated with the 2002 revenue.

The Company's unaudited financial statements show net losses of
$138,792 and $563,159 for the three months ended November 30,
2002 and 2001, respectively.

The Company is not generating any cash from operations and it
has no cash resources. It is in default on the $350,000 loan
agreement with a bank and has been unable to meet its
obligations under the $5,000,000 notes to Gibralter Publishing,
Inc. The payments on various capital leases are also in arrears.
This situation and the anticipated need for working capital for
the Company to increase its marketing and revenue base has
resulted in the Board of Directors taking certain actions
intended to stabilize the Company and provide it with a chance
to succeed in the future. On December 10, 2002, the Company and
Gibralter Publishing, Inc. agreed to exchange $5,000,000 in
notes for 1,000,000 shares of Series D Preferred shares and
10,000,000 warrants for purchase of common shares of the
Company.

On December 4, 2002, the Board of Directors also approved the
proposed transaction with WAG Holdings, LLC, Glen H. Hammer and
A. Randall Barkowitz ("Investor Group") that will add sufficient
capital to help relieve the Company's short-term cash flow
crisis. The Board anticipates that the Investor Group will be
able to locate sufficient additional funding to address the
Company's longer-term financial needs, although there can be no
assurance that such funding will be obtained. This transaction
provides that in exchange for $750,000 the Investor Group will
receive 70% of the Company's fully diluted post transaction
common stock. Although not required, the Company is seeking the
approval of the transaction by the Company's shareholders at a
Special Meeting to be held February 4, 2003. As a condition to
the consummation of the proposed transaction, the Company
intends to effect a 1-for-10 reverse stock split, the approval
for which will be sought at the same Special Meeting of
Shareholders.

The Company's independent certified public accountants have
stated in their report included in the Company's August 31, 2002
Form 10-KSB, that the Company has incurred operating losses in
the last two years, and that the Company is dependent upon
management's ability to develop profitable operations. These
factors among others may raise substantial doubt about the
Company's ability to continue as a going concern.


PERKINELMER INC: Fourth Quarter 2002 Results Show Improvement
-------------------------------------------------------------
PerkinElmer, Inc., (NYSE: PKI) reported fourth quarter 2002 GAAP
earnings per share from continuing operations of $.01 on revenue
of $410 million.

Included in the results from the fourth quarter of 2002 were a
net restructuring charge of $26.5 million, intangibles
amortization of $7.1 million, and a net gain of $2.1 million
associated with the Company's debt refinancing transactions. The
aggregate after-tax impact of these items was approximately $.17
per share.

For the fourth quarter of 2001, the Company's GAAP results from
continuing operations was a loss of $.41 per share on revenue of
$406 million. The fourth quarter of 2001 results included $70.5
million of charges from the Packard BioScience acquisition,
principally related to an in-process research and development
charge, $1.6 million of restructuring and other charges, net of
gains on dispositions, and $14.1 million of goodwill and
intangible amortization. The aggregate after-tax impact of these
items in the fourth quarter of 2001 was $.75 per share.

Total continuing and discontinued operations for the fourth
quarter of 2002 resulted in a loss of $.02 per share on a GAAP
basis, which included an after-tax loss of $3.3 million from
discontinued operations. The comparable loss during the fourth
quarter of 2001 was $.43 per share, which included after-tax
losses of $2 million from discontinued operations.

Revenue in the fourth quarter of 2002 was $410 million, up 1%
from the same period of 2001. Growth in sales of consumables,
reagents, and service as well as digital imaging and sensors
products was offset by revenue declines in instruments and sales
to certain general industrial markets.

The Company generated operating cash flow of $50 million in the
fourth quarter of 2002, and reduced debt, net of cash, to $488
million. During the quarter, the Company reduced working capital
by $18 million. Depreciation and amortization for the fourth
quarter of 2002 were $21 million.

"The strong cash flow we generated reflects the emphasis we're
placing on cash flow management throughout the Company," said
Gregory L. Summe, chairman and CEO of the Company. "We were
pleased with our ability to generate $50 million in operating
cash flow in the quarter and $108 million for the year. This
allowed us to reduce our net debt by approximately $100 million
during the year."

As previously announced, the Company completed its debt
refinancing transactions during the fourth quarter of 2002,
which extends the average maturity of the Company's debt to over
seven years. The new debt consists of $300 million in 10-year
senior subordinated notes and a senior secured 6-year term loan
of $315 million. PerkinElmer also has a $100 million revolving
credit facility, which remains undrawn. Through this
refinancing, PerkinElmer retired the majority of its zero-coupon
convertible debentures, and has retained funds in escrow to
retire the balance of this issue of debentures during 2003. The
refinancing also enabled the retirement of $110 million of the
Company's 2005 notes.

Financial overview by reporting segment:

Life Sciences reported revenue of $130.8 million for the fourth
quarter of 2002, up 5% compared to revenue of $124.5 million for
the fourth quarter of 2001. The fourth quarter of 2002 included
a full quarter of revenue for Packard BioScience, which was
acquired by the Company in November 2001. The impact of
including Packard BioScience for all of the fourth quarter of
2001 would increase revenue for Q4 2001 by $15.6 million. Growth
in reagents and consumables was offset by continued softness in
capital spending, particularly within large pharmaceutical
company markets that impacted certain instrument sales year over
year. In the fourth quarter of 2002, the segment's GAAP
operating loss was $3.3 million versus a $68.4 million operating
loss in the fourth quarter of 2001. The fourth quarter of 2002
included a restructuring charge of $12.9 million and
amortization of $4.7 million. The fourth quarter of 2001 GAAP
operating loss included $70.5 million of charges related to the
Packard BioScience acquisition, $11.9 million of restructuring
and other charges, and $8.8 million of intangibles amortization.

Analytical Instruments reported revenue of $143 million for the
fourth quarter 2002, representing a 3% decline compared to
revenue of $147.1 million for the fourth quarter of 2001. During
December 2001, the Company sold its IRAS product line. Excluding
the revenue from this business for the fourth quarter of 2001
would reduce revenue for Q4 last year by $13 million. Increases
in the sales of consumables and several new products into
industrial markets year over year were partially offset by
declines in the pharmaceutical market. For the fourth quarter of
2002, GAAP operating profit was $0.5 million compared to $34.9
million in the fourth quarter of 2001. The fourth quarter 2002
operating profit included $13.2 million in restructuring charges
and $1.1 million in amortization. Operating profit for the same
period in 2001 included gains net of restructuring and other
charges of $16.6 million associated with the disposition of
businesses, and $3.0 million in intangibles amortization.

Optoelectronics reported revenue of $87 million for the fourth
quarter of 2002, an increase of 3% compared to revenue of $85.1
million for the fourth quarter of 2001. This business segment
showed double-digit growth in revenues for its digital imaging,
flash, and sensor products, which was offset by continued
weakness for product sales to semiconductor end markets. GAAP
operating profit for the segment was $7.7 million during the
fourth quarter of 2002 versus $0.3 million in the same quarter
of 2001. The results for the fourth quarter of 2002 included a
restructuring charge of $0.5 million and $0.3 million in
amortization. The results for the fourth quarter of 2001
included restructuring and other charges, net of gains from the
disposition of businesses of $6.4 million, and amortization of
$1.7 million.

Fluid Sciences reported revenue of $48.6 million for the fourth
quarter of 2002, representing a decline of 1% compared to
revenue of $49.3 million for the fourth quarter in 2001 due
primarily to lower aerospace revenues, which were partially
offset by increased sales of value-added assemblies and a modest
increase in power generation revenues. During the fourth quarter
of 2002, Fluid Sciences received the first production order for
its hydrodynamic seal from a major aerospace engine company, and
its first order for higher-level assemblies from a leading
semiconductor wafer processing equipment manufacturer. GAAP
operating profit for the fourth quarter of 2002 was $4.8 million
versus $9 million in the fourth quarter of 2001. The results
from the fourth quarter of 2002 included amortization of $0.9
million, while the results from the fourth quarter of 2001
included amortization of $0.7 million.

The Company projects 2003 GAAP EPS from continuing operations to
be in the range of $.37 to $.43 including the negative impact of
intangibles amortization of $.15 per share. For the first
quarter of 2003, the Company projects GAAP EPS from continuing
operations between $.02 and $.05 per share on a GAAP basis,
including the negative impact of intangibles amortization of
$.04 per share. In Q1 2002, the Company's GAAP results from
continuing operations was a loss of $.16 per share.

"Entering 2003, our strategy is to continue our focus on driving
cost productivity, accelerating new product introductions, and
improving working capital," added Summe. "We believe these
initiatives will enable us to reach our financial goals in
2003."

PerkinElmer, Inc., is a global technology leader focused in the
following businesses - Life and Analytical Sciences,
Optoelectronics, and Fluid Sciences. Combining operational
excellence and technology expertise with an intimate
understanding of our customers' needs, PerkinElmer creates
innovative solutions - backed by unparalleled service and
support - for customers in health sciences, semiconductor,
aerospace, and other markets whose applications demand absolute
precision and speed. The company markets in more than 125
countries, and is a component of the S&P 500 Index. Additional
information is available through http://www.perkinelmer.comor
1-877-PKI-NYSE.

                           *     *     *

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

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

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


PHOTOCHANNEL NETWORKS: Tinkers with Agreement Terms with Skana
--------------------------------------------------------------
PhotoChannel Networks Inc., (TSX: PNI) amended the terms of the
agreement with Skana Photo-Lab Products, previously announced
May 10, 2002, to act as the Canadian distributor of the
PhotoChannel Network. Under this amendment, Skana may now
earn up to 2,000,000 common share purchase warrants. The
warrants vest at a rate of 10,000 warrants for each retail
location introduced by Skana and hooked up to the Network. Each
warrant is exercisable at $0.10 per share at any time after
vesting and on or before January 23, 2004. The warrants and
underlying securities are subject to a four month hold period
expiring May 23, 2004. In addition to the warrants, Skana also
receives a fee for each transaction conducted through the
Network from Skana introduced retailers.

Founded in 1995, PhotoChannel is a leading digital imaging
technology provider for a wide variety of businesses including
photofinishing retailers, professional/commercial photo
processing labs, image content owners and targeted portal
services. PhotoChannel has created and manages the PhotoChannel
Network environment whose focus is delivering digital image
orders from capture to fulfillment under the control of the
originating PhotoChannel Network partner. For more information
visit http://www.photochannel.com

PhotoChannel filed for Chapter 7 Liquidation on November 1,
2001, in the U.S. Bankruptcy Court for the District of
Connecticut in Bridgeport.


PLAYTEX PRODUCTS: Says Significant Cash Flow Cuts Debt in 2002
--------------------------------------------------------------
Playtex Products, Inc. (NYSE:PYX), reported results for the
fourth quarter and full year of 2002. In the fourth quarter, the
Company earned $7.2 million. These results compare with fourth
quarter 2001 reported earnings of $3.6 million, and 2001
adjusted earnings of $8.1 million, when adjusted to reflect the
elimination of the amortization of certain intangible assets.
These results compare with reported 2001 earnings of $11.5
million and adjusted 2001 earnings of $49.0 million, after
excluding an extraordinary loss and as adjusted to reflect the
elimination of the amortization of certain intangible assets.
The Company generated significant cash flow for the 2002 fiscal
year that resulted in the reduction of debt by $61.1 million.

Net sales were $159.2 million in the fourth quarter of 2002 and
$719.1 million for the fiscal year, which compare with prior
year results of $166.7 million and $723.5 million, respectively.
Versus year ago, Feminine Care net sales were 2% higher for the
year but lower in the quarter due to a 6% reduction in overall
shipments and higher brand support to the trade, as part of the
Company's aggressive defense against a competitive new product
launch in the plastic tampon segment. Infant Care net sales were
up 3% for the quarter and essentially flat for the year as new
products helped contribute to an improved trend. While Sun Care
grew in market share and increased consumption by 5% for the
year, net sales for 2002 were below year ago by 4% for the year
and were lower in the fourth quarter. Sun Care net sales were
impacted by the previously announced initiative to lower costs
associated with returns coupled with a prior year adjustment to
returns recorded in the second quarter of 2002. Household
Products increased by 24% in the quarter and 5% for the year
versus the prior year due to the success of Woolite's new
products, especially Oxy Deep.

"Overall, we are pleased with our results this year. We
continued to maintain strong market positions in all of our key
categories with 95% of our net sales in categories where we are
the #1 or #2 brand; we gained Feminine Care market share in
tampons through the first nine months of 2002 putting us in a
strong position to defend against the competitive product
launch, and we introduced a complementary new product to enhance
category results; our Infant Care trends are improving as
consumers respond favorably to our new products and marketing
efforts; we continued to grow market share and consumption in
Sun Care and have already begun to lower costs associated with
returns; and we've had great success with our new Woolite
products," stated CEO, Michael R. Gallagher.

Mr. Gallagher continued, "We believe that we are well positioned
as we enter 2003. In Feminine Care, we will execute a very
strong marketing support plan, introduce important tampon
product improvements into the market in the first quarter, and
will pursue our successful strategy of growing consumption and
share by targeting pad and younger users in our tampon segment.
In Infant Care, we are encouraged by the results in the second
half of 2002 and will continue to enhance product offerings to
drive growth. The 2003 Sun Care season is off to a very strong
start with excellent reception to our new product line-up and
strong opening orders across our customer base. In addition, the
momentum in Woolite is outstanding with a record market share
being achieved behind Oxy Deep."

The Company reiterates its 2003 target of 3%-4% top line growth
with a 7%-10% increase in EPS. The Company expects the earnings
flow between quarters to vary versus 2002, as a result of the
significant level of investment spending to support tampons and
the introductory support behind Playtex Heat Therapy and Woolite
Oxy Deep. For the first quarter 2003, earnings are expected to
be in the $0.20-$0.23 range. The fourth quarter 2003 should be
significantly above 2002 as a result of a return to more
normalized support spending for that portion of the year.

The Company's financial results for the current year and prior
year were impacted by extraordinary items, accounting changes
for intangibles, a favorable tax ruling, and a plant closing.
Please refer to the attached Consolidated Statement of Earnings
for a full reconciliation of reported and as adjusted results.

Playtex Products, Inc., is a leading manufacturer and
distributor of a diversified portfolio of personal care and
consumer products, including Playtex infant feeding products,
Wet Ones, Baby Magic, Diaper Genie, Mr. Bubble, Playtex tampons,
Banana Boat, Woolite rug and upholstery cleaning products,
Playtex gloves, Binaca and Ogilvie.

As reported in Troubled Company Reporter's November 15, 2002
edition, Standard & Poor's placed its 'BB-' long-term corporate
credit and senior secured bank loan ratings, as well as its 'B'
subordinated debt rating for personal care company Playtex
Products Inc., on CreditWatch with developing implications.
Developing implications means that the ratings could be raised,
lowered, or affirmed, depending on the outcome of Standard &
Poor's review.

"The CreditWatch listing follows Westport, Connecticut-based
Playtex's decision to explore strategic alternatives to maximize
long-term shareholder value, including the possible sale of the
entire company," said Standard & Poor's credit analyst Lori
Harris.


POPE & TALBOT: Widens Net Loss to $12 Million in Fourth Quarter
---------------------------------------------------------------
Pope & Talbot, Inc., lost $11.9 million in the fourth quarter of
2002.  The net loss for the twelve months ended December 31,
2002 was $21.0 million.  Fourth quarter 2001 losses were $7.9
million and full year 2001 losses were $24.9 million.  Revenues
were $138.4 million in the fourth quarter of 2002 compared to
$137.0 million in the fourth quarter of 2001.  Annual revenues
were $546.3 million versus $499.2 million in 2001.

Pope & Talbot will pay a dividend of $0.08 per share on
February 18, 2003 to shareholders of record on February 4, 2003.
While dividends are an important aspect of the Company's policy
of providing returns to shareholders, the extended economic
downturn has resulted in substantial losses.  These factors,
combined with the burden of lumber import duties in excess of
$6 million per quarter, has eroded the Company's net worth.

Michael Flannery, Chairman and Chief Executive Officer stated,
"While we remain concerned about the unpredictability of the
general economy and a near-term recovery, the pulp markets are
showing definite signs of improvement and, I believe, the
prospects for future price increases are good.  However, it is
unclear how the lumber business will perform until the lumber
import duty debate between the U.S. and Canada is resolved.  As
a result of these concerns and the recent deterioration in the
Company's net worth, the Board of Directors has decided to
reduce the dividend by approximately half."

                              Pulp

Northern bleached softwood kraft (NBSK) pulp prices dropped
rapidly in both European and Asian markets in the fourth
quarter.  Pope & Talbot's prices for its mix of sawdust and chip
NBSK pulp dropped $38 per metric ton, or 8 percent, versus the
third quarter of 2002 and were flat with fourth quarter of 2001
average prices.  On an annual basis, pulp prices are down $33
per ton, or 7 percent, at $419 per metric ton in 2002 versus
$452 in 2001.

In the fourth quarter, pulp shipment volume was 196 thousand
metric tons, which was slightly ahead of production of 194
thousand metric tons.  The pulp mills costs rose and production
rates dropped in the fourth quarter as the mills experienced
high energy costs and the Harmac mill had production issues
related to an outage it took to repair one of its recovery
boilers.

                         Wood Products

Pope & Talbot's lumber business continues to be significantly
affected by the lumber dispute between the U.S. and Canada.
Based on final determinations by the U.S. government, Pope &
Talbot has been incurring duties at the rate of 27.2 percent on
all lumber imported into the U.S. since May 22, 2002.  Total
duties incurred were $6.2 million in the fourth quarter and
$14.1 million year-to-date.  The impact of these duties on the
full year was offset by a $15.6 million reversal in the first
half of 2002 for lumber import duties accrued (but not paid) in
2001.

The average lumber price of $315 per thousand board feet was
down $4 per thousand board feet since the third quarter of 2002,
and flat with last year's fourth quarter average price.  On an
annual basis, average lumber prices were down $7 per thousand
board feet, or 2 percent, at $322 per thousand board feet in
2002 versus $329 in 2001.  Lumber shipment volume of 147 million
board feet in the fourth quarter of 2002 was slightly behind
production volume of 151 million board feet.  Significant
sawmill cost improvements continued in the fourth quarter and
the realization of lumber from logs (recovery) rose to record
levels.

Pope & Talbot's capital expenditures were $3.5 million in the
fourth quarter and $17.3 million for the full year 2002.
Depreciation was $9.1 million in the fourth quarter and $35.3
million year-to-date.

At the end of the year, the Company's cash and short-term
investments were $4.3 million and total debt was $232.7 million.
The combined net debt of $228.4 million represents an increase
of $7.7 million since September 30th and an increase of $9.2
million since the prior year-end.  At December 31, 2002,
shareholders' equity stood at $143.9 million and net debt to
total capitalization was 61 percent.

Pope & Talbot is dedicated to the pulp and wood products
businesses.  The Company is based in Portland, Oregon and traded
on the New York and Pacific stock exchanges under the symbol
POP.  Pope & Talbot was founded in 1849 and produces market pulp
and softwood lumber at mills in the U.S. and Canada. Markets for
the Company's products include the U.S., Europe, Canada, South
America, Japan and the other Pacific Rim countries.  For more
information on Pope & Talbot, Inc., please check the Web site at
http://www.poptal.com

As previously reported, Standard & Poor's assigned its double-
'B' rating to pulp and lumber producer Pope & Talbot Inc.'s $50
million senior unsecured notes due 2013.

Standard & Poor's also affirmed its existing ratings on the
company, including its double-'B' corporate credit rating. The
outlook remains stable. Debt outstanding at the company at March
31, 2002, totaled $230 million.


PORTOLA PACKAGING: Says Cash Resources Sufficient to Fund Ops.
--------------------------------------------------------------
Portola Packaging, Inc., is a major designer, manufacturer and
marketer of tamper evident plastic closures, plastic bottles and
related equipment used for packaging applications in dairy,
fruit juice, bottled water, sports drinks, institutional foods
and other non-carbonated beverage products. The Company was
acquired in 1986 through a leveraged acquisition led by Jack L.
Watts, the Company's current Chairman of the Board and Chief
Executive Officer.

The Company's sales decreased $2.3 million, or 4.2%, from $54.2
million for the three months ended November 30, 2001 to $51.9
million for the three months ended November 30, 2002. This
decrease was primarily due to decreased sales of $2.0 million by
the U.S. closure division largely due to the consolidation of a
few large domestic customers which resulted in lower selling
prices as well as a less favorable product mix. Equipment sales
decreased $0.5 million mainly due to delays in placing of
customer orders. Sales decreased $0.3 million in the United
Kingdom due to decreased volume driven by market demand.
Offsetting these decreases were increased sales of $0.4 million
in Canada due to increased sales produced by its Toronto
facility and $0.1 million in tooling due to timing of customer
orders.

Gross profit decreased $1.1 million to $11.2 million for the
first quarter of fiscal 2003 compared to $12.3 million for the
first quarter of fiscal 2002. As a percentage of sales, gross
profit decreased from 22.7% for the first quarter of fiscal 2002
to 21.6% for the same quarter in fiscal 2003. The margin
decrease was primarily due to an increase in resin costs in the
fourth quarter of 2002 that were not reflected in prices to
contract customers during the first quarter of fiscal year 2003
and also increased utility costs.

Net loss was $1.1 million in the first quarter of fiscal year
2003 as compared to a net loss of $0.6 million in the first
quarter of fiscal year 2002.

At November 30, 2002, the Company had $3.8 million in cash and
cash equivalents as well as borrowing capacity of approximately
$30.9 million under the revolving credit line, less a minimum
availability requirement of $3.0 million. Management believes
that these resources together with anticipated cash flows from
operations, will be adequate to fund the Company's operations,
debt service requirements and capital expenditures throughout
fiscal year 2003. The Company may require additional funds to
support other purposes and may seek to raise these additional
funds through debt financing or through other sources.


PRIVATE BUSINESS: Defaults on Covenants Under Senior Loan Pact
--------------------------------------------------------------
Private Business, Inc. (Nasdaq:PBIZ), a leading provider of cash
flow and retail inventory management solutions for community
banks and small businesses, is revising its earnings guidance
for the year ended December 31, 2002.

Based on its preliminary unaudited financial statements for the
twelve months ended December 31, 2002, Private Business is
revising its guidance for the full year. The Company now expects
to achieve $11 million to $12 million in EBITDA (earnings before
interest, taxes, depreciation, and amortization), and $0.18 to
$0.21 diluted earnings per share, on revenues of $54 million to
$55 million, for the year ended December 31, 2002. These revised
results are subject to completion of the Company's annual audit
and do not include any potential year-end audit adjustments.

In addition, the Company will no longer provide any guidance on
its earnings for the year ending December 31, 2003, and
thereafter. As part of this policy, Private Business will also
no longer review or comment on any financial models or earnings
estimates on the Company.

Private Business further noted that at the time of this release
it expected to be in non-monetary default of its Minimum EBITDA
and Ratio of Consolidated Debt to EBITDA requirements under the
terms of its senior loan agreement for the quarter ended
December 31, 2002. The Company is discussing this default with
its lenders, and management believes that it will be able to
reach a resolution to its covenant obligations with its lenders.
The Company emphasized that it has made all payments due under
the senior loan agreement in full and on time.

Private Business, Inc., is a leading provider of cash flow and
retail inventory management solutions for community banks and
middle-market businesses. The Company is headquartered in
Brentwood, Tennessee, and its common stock trades on The NASDAQ
Stock Market under the symbol "PBIZ".


READER'S DIGEST: Reduces Working Capital Deficit to $27 Million
---------------------------------------------------------------
The Reader's Digest Association, Inc., (NYSE: RDA) announced
earnings for the Fiscal 2003 second quarter ended December 31,
2002 of $0.90 per share, excluding one-time expenses of $0.06
per share related to the recently completed share
recapitalization, versus EPS of $0.78 in the Fiscal 2002 second
quarter. Including recapitalization costs, earnings were $0.84
per share.  Revenues were up 6 percent, to $831 million, EBITDA
(segment operating profit, excluding depreciation and
amortization) was up 21 percent, to $163 million, and operating
profits were up 16 percent, to $147 million, versus the same
quarter one year ago.  Free cash flow (change in net cash
position before dividends, share repurchases, divestitures and
acquisitions) improved by $10 million over the prior year to
$161 million.

At December 31, 2002, the Company's balance sheet shows that
total current liabilities exceeded total current assets by about
$27 million, down from a deficit of about $117 million recorded
at June 30, 2002.

"The bright spots this quarter were our U.S. businesses, which
in aggregate grew operating profits by more than 30 percent.
The second quarter typically represents the largest for our
higher-margin U.S. businesses, Books Are Fun, Reiman and QSP.
All three performed well; in fact, they contributed about 80
percent of the company's operating profits for the quarter.  Our
mature domestic businesses, U.S. Magazines and U.S. Books and
Home Entertainment, dramatically improved operating results on
reduced revenues. For the second consecutive quarter, U.S. BHE
reduced costs and revenues, and cut operating losses by about
half," said Thomas O. Ryder, Chairman and Chief Executive
Officer.  "These gains were offset by a weaker-than-expected
international performance, especially in Europe, where some of
our best-performing markets in recent years are experiencing
margin pressure operating in weak economies."

Consolidated revenues grew by 6 percent to $831 million versus
the prior-year quarter, driven largely by the addition of
Reiman, which contributed $99 million during the second quarter,
as well as by 10 percent revenue growth at Books Are Fun and
growth at QSP.  Excluding Reiman, second quarter revenues
declined by 7 percent, reflecting reduced activity and lower
response rates in international markets, and planned reductions
in mail quantities and revenue reductions after exiting from
video, catalog and some series businesses at U.S. BHE.  The
favorable effects of fluctuations in foreign-currency exchange
added 2 percent to the company's revenue and operating profit
growth.

Operating profits of $147 million were 16 percent higher than in
the year-ago quarter.  This improvement was driven by a 38
percent profit improvement at U.S. Magazines, reflecting the
addition of Reiman and profit improvement at Reader's Digest
magazine and the Special Interest Publications. North America
BHE profits improved by 37 percent, caused by sales-driven
profit growth at Books Are Fun and a significantly reduced loss
at U.S. BHE. These improvements were offset by lower profits
across the International Businesses.  Excluding Reiman,
operating profits for the company were flat as the weakness in
the international business offset strength in the United
States.

                              Outlook

The company expects continued strength in its U.S. businesses
and weakness internationally for the remainder of Fiscal 2003.
Due to the sharp decline in international profits and economic
weakness in many overseas markets, the company now expects full-
year EPS to be in the range of $1.08 to $1.18, excluding
recapitalization expenses.  This compares with the company's
previous guidance of $1.20 to $1.30, which also excluded
recapitalization expenses.  The reduced guidance reflects an
expected decline of more than 40 percent in full-year operating
profits in the international segment relative to Fiscal 2002.

In the third quarter, the company expects earnings of $0.02 to
$0.07, compared with $0.16 in the Fiscal 2002 third quarter.
The forecast for the Fiscal 2003 third quarter reflects the
expected lower international results as well as:  a one-time
payment under a financial-services agreement in the Fiscal 2002
third quarter; the occurrence of the Easter sales season in the
fourth quarter of Fiscal 2003, compared with the third quarter
of Fiscal 2002; and, as expected, dilution from the Reiman
acquisition of 2 cents in the third quarter of Fiscal 2003.
(For the full Fiscal 2003 Reiman results are expected to be
accretive by 2 to 3 cents.)

                    OPERATING SEGMENT RESULTS

            North America Books and Home Entertainment

For the Fiscal 2003 second quarter, North America BHE operating
profits increased by 37 percent to $28 million, versus $21
million in the second quarter of Fiscal 2002.  This improvement
was driven by a strong performance by Books Are Fun, which
continued to grow at a double-digit rate despite the challenging
retail environment and disruptions caused by the West Coast
docks work stoppage.  U.S. BHE contributed to the improvement by
reducing its operating losses almost by half, reflecting the
elimination of unprofitable products, ongoing cost improvement
initiatives and overhead savings.  U.S. BHE continued to
diversify its business, reducing its dependence on sweepstakes
promotions.  This included launching a new micropublishing book
about diabetes, marketed direct to customers without
sweepstakes.  This book was the best-selling U.S. BHE product in
the quarter.  The division expanded its RD Young Families
outside list program via telemarketing and non-sweepstakes
direct mail, implemented new programs in its Financial Services
business (all non-sweepstakes), and increased sales through in-
house channels including QSP and Books Are Fun.

During the quarter, the company invested in product and
marketing for the December 27 national launch of ChangeOne, its
first proprietary weight-loss book and diet system.  The
ChangeOne program, which features a hardcover book for sale by
trade and direct marketing as well as a subscription Web site,
http://www.changeone.com is expected to contribute to results
in subsequent quarters.  In January, trade sales have been
strong, and the book made The New York Times Best-Seller List
(No. 10 in Hardcover Advice) and was a "Fastest Mover" on
Amazon.com, where it was as high as No. 4 against all book
titles.

Fiscal 2003 second quarter revenues for the NA BHE segment were
$199 million, down from revenues of $226 million in Fiscal 2002.
The decline largely reflects the planned reduction in
sweepstakes-related marketing activity in the United States,
partially offset by the gains at Books Are Fun.

                      International Businesses

International Businesses, comprising BHE and magazines outside
of North America, had revenues of $290 million and operating
profits of $23 million in the second quarter of Fiscal 2003,
compared with revenues of $313 million and operating profits of
$37 million in the year-ago quarter.  Revenues and profits were
lower primarily due to reduced activity and soft response rates.

Results in Europe were lower for single-sales products, mainly
General Books, and some series products in the United Kingdom,
France, Germany, and Poland.  In part, this has been the result
of efforts to rest customer lists and improve single-sales
performance.  Response rates and advertising revenues were lower
in most European markets stemming from weak economies.

Results were also lower in Latin American and Asian markets,
caused by lower performance of single-sales products including
General Books, music and video.  The greatest declines were in
Mexico and Australia, which had reduced mail quantities and
lower payment performance.

Several of the International Businesses are investing in new
initiatives like the international expansion of Books Are Fun,
QSP, and Reiman as well as new customer-acquisition channels,
particularly outside lists and list-sharing programs.

For the second half of Fiscal 2003, the company is accelerating
efforts to cut costs overseas and reduce mailing quantities to
limit exposure and mitigate the decline in operating profits
during the current unfavorable trading environment.

                          U.S. Magazines

U.S. Magazines, comprising U.S. Reader's Digest magazine,
Special Interest Publications, QSP and Reiman Media Group, had
revenues of $342 million, up 40 percent over the year-ago
quarter.  Revenue growth was driven by the addition of Reiman,
which added $99 million of revenues in the quarter and continues
to perform as expected at the time of its acquisition.  On a
comparable basis, Reiman revenues grew 5 percent in the quarter,
principally driven by solid year-over-year growth in the book-
marketing program.  Excluding Reiman, U.S. Magazines revenues
were relatively flat versus the prior year.  The largest revenue
contributor, QSP, grew revenues slightly on gains across all
major product categories.  Reader's Digest magazine had lower
revenues in the quarter, reflecting planned reduced circulation
sales as the magazine has been adjusting its circulation level
to improve profitability.  As part of this effort, in January
2003 the company brought the Reader's Digest circulation rate
base to 11 million from 12 million copies.  The Special Interest
Publications had revenue growth, reflecting improvement in the
company's do-it-yourself magazines and at U.S. Selecciones.

Operating profits were up 38 percent to $95 million, from $69
million in the year-ago period.  Profit growth was primarily
driven by Reiman, which accounted for $20 million in operating
profit.  Excluding Reiman, operating profits grew by 9 percent
in the quarter, led by profit growth at:  Reader's Digest
magazine, reflecting lower promotion and customer-acquisition
expense; The Family Handyman, American Woodworker and U.S.
Selecciones, reflecting improved performance; and QSP.  During
the quarter, the company invested in the development and
introduction of RD Specials, a new series of Digest-size one-
time publications that feature content reprinted from Reader's
Digest and Reiman magazine titles.  RD Specials are sold
exclusively at supermarket check-out counters.

The Reader's Digest Association, Inc., is a global publisher and
direct marketer of products that inform, enrich, entertain and
inspire people of all ages and cultures around the world.
Global headquarters are located at Pleasantville, New York.  The
company's main Web site is at http://www.rd.com


REGUS BUSINESS: Schedules and Statements Should be Filed Today
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
gave Regus Business Centre Corp., and its debtor-affiliates an
extension to file their schedules of assets and liabilities,
statements of financial affairs and lists of executory contracts
and unexpired leases required under 11 U.S.C. Sec. 521(1).  The
Debtors have until today to file their Schedules of Assets and
Liabilities and Statement of Financial Affairs.

Regus Business Centre Corp., filed for chapter 11 protection on
January 14, 2003. Karen Dine, Esq., at Pillsbury Winthrop LLP
represents the Debtors in their restructuring efforts.  When the
Debtors filed for protection from its creditors, it listed debts
and assets totaling:
                                Total Assets:    Total Debts:
                                -------------    ------------
Regus Business Centre Corp.    $161,619,000     $277,559,000
Regus Business Centre BV       $157,292,000     $160,193,000
Regus PLC                      $568,383,000      $27,961,000
Stratis Business Centers Inc.      $245,000       $2,327,000


ROWECOM INC: divine inc Lauds Asset Sale Transaction with EBSCO
---------------------------------------------------------------
divine, inc. (Nasdaq: DVIN), a leading provider of solutions for
the extended enterprise, announced that RoweCom, Inc., a wholly
owned subsidiary of divine, has signed a letter of intent with
EBSCO Industries, Inc., the global leader for the delivery of
integrated information systems and services, for the sale of
RoweCom's business to EBSCO. This agreement supercedes the
original letter of intent announced on December 20, 2002, and
includes RoweCom's worldwide operations. RoweCom, which was
acquired by divine in November 2001, provides high-quality
service and e-commerce solutions for purchasing and managing the
acquisition of magazines, newspapers, journals and e-journals,
books and other sources of comprehensive knowledge resources.

The proposed transaction, which is contingent upon regulatory
approval in France and customary closing conditions, has been
endorsed by the steering committee of the ad hoc committee of
publishers and RoweCom customers. In connection with this
agreement, certain publishers represented on the ad hoc
committee have agreed to fulfill subscriptions orders to RoweCom
customers who prepaid for subscription orders.

"We believe that the sale of RoweCom to EBSCO is the optimal
solution for its customers and the various publishers that
provide content to customers," said divine Chairman and Chief
Executive Officer Andrew "Flip" Filipowski. "We are grateful to
our customers and the publishers who continue to work with us to
achieve a resolution that we believe is in everyone's best
interests and appreciate the patience of customers and
publishers as the negotiation process has moved forward."

To facilitate the sale of RoweCom's assets and operations to
EBSCO, and to ensure that RoweCom's operations continue without
interruption until the transaction is finalized, RoweCom expects
to file a voluntary petition for reorganization under Chapter 11
of the U.S. Bankruptcy Code.

"We are enthusiastic about the acquisition of RoweCom, which
substantially strengthens EBSCO's commitment to our subscription
business in Europe and complements our existing operations in
North America. In particular, RoweCom has a long and proud
history of service to the French marketplace as well as to the
rest of Europe," F. Dixon Brooke, Jr., vice president and
division general manager of EBSCO Subscription Services. "Our
primary mission now is to team with the RoweCom staff to
diligently work with customers and publishers to ensure
customers continue to receive the service they have enjoyed in
the past."

In December, divine announced that RoweCom would most likely be
unable to obtain the necessary financing that it expected to
receive in order to pay publishers the subscription fees for
customer orders for 2003 periodicals, as the company has done in
the past. Once it became clear that RoweCom might not be able to
meet obligations owed to publishers, it stopped taking orders
from customers and stopped accepting pre-payments for 2003
subscription fees. divine also hired independent financial
advisors to help manage RoweCom and seek alternative financing
options, including potential buyers of RoweCom's business.

divine, inc., (Nasdaq: DVIN) is focused on extended enterprise
solutions. Through professional services, software services and
managed services, divine extends business systems beyond the
edge of the enterprise throughout the entire value chain,
including suppliers, partners and customers. divine offers
single-point accountability for end-to-end solutions that
enhance profitability through increased revenue, productivity
and customer loyalty. The company provides expertise in
collaboration, interaction and knowledge solutions that
enlighten, empower and extend enterprise systems.

Founded in 1999, divine focuses on Global 5000 and high-growth
middle market firms, government agencies and educational
institutions and currently serves over 20,000 customers. For
more information, visit the company's Web site at
http://www.divine.com

EBSCO Industries, Inc., is a global corporation with sales,
service and manufacturing subsidiaries at work in 19 countries
around the world. EBSCO's business interests include information
management services, journal and periodical subscription
services, real estate development, commercial printing and more.
EBSCO, an acronym for Elton B. Stephens Company, is based in
Birmingham, Alabama and employees 4,000 people around the world.
Additional information on EBSCO Industries is available from
http://www.ebscoind.com


RUSSELL CORP: Look for Fourth Quarter 2002 Results by Feb. 13
-------------------------------------------------------------
Russell Corporation (NYSE: RML) expects to report its fourth
quarter earnings on Thursday, February 13, 2003.  On that date,
a news release and supporting financial data will be released to
the news wire services and the New York Stock Exchange before
the market opens, and a conference call will be held at
8:30 a.m., eastern time.

To listen, please call the conference call line at (877) 264-
7865, domestically, and (706) 634-4917, internationally, ten
minutes prior to the scheduled start time and use conference id
number 7768631.  This conference call will also be broadcast
live on the Internet.  A link to the broadcast can be found on
the Company's Web site at http://www.russellcorp.com

If you are unable to participate in this conference call, a
replay will be available through February 20, 2003, by dialing
1-800-642-1687, domestically, and (706) 645-9291,
internationally, and entering 7768631.  Alternatively, a replay
of the call will be available at the Investor Relations section
of the Company's Web site through March 13, 2003.

Russell Corporation is a leading branded apparel company
marketing activewear, casualwear and athletic uniforms under
widely-recognized brands, including: Russell Athletic(R),
JERZEES(R), Mossy Oak(R), Cross Creek(R), Discus(R) and Moving
Comfort(R).  The Company's common stock is listed on the
New York Stock Exchange under the symbol RML and its Web site
address is http://www.russellcorp.com

                           *    *    *

As previously reported in the Troubled Company Reporter,
Standard & Poor's assigned a corporate credit rating of 'BB+' to
apparel manufacturer Russell Corp.  It also assigned a BB+
rating to the company's proposed $375 million senior secured
credit facility and a BB rating to a proposed $200 million
senior unsecured note issue.

The ratings, S&P said, reflect Russell's participation in the
highly competitive and volatile apparel industry, which is
subject to changing consumer preferences and a consolidating
retailer base.  Somewhat mitigating these factors are the
company's well known brand name, its strong market position, and
its moderate financial profile.


SEAVIEW VIDEO: Auditors Doubt Ability to Continue Operations
------------------------------------------------------------
Seaview Video Technology, Inc., has incurred a net loss of
$3,961,901 during the nine months ended September 30, 2002, has
used cash of $711,329 during the same period in maintaining its
operations, and has a working capital deficiency of $237,327 as
of September 30, 2002. These conditions raise substantial doubt
about the Company's ability to continue as a going concern. The
Company's losses have arisen as a result of weak Marine Product
Segment sales, driven largely by the economic downturn in the
marine industry. In addition, the Company has devoted
significant efforts in the further development and marketing of
products in its Security Products Segment, which, while now
showing tangible results in the form of purchase orders both
received and forthcoming, cannot yet be classified as sufficient
to totally fund operations for any period of time.

The Company's ability to continue is dependent upon: raising
additional capital to fund operations and development; the
further development of the Security Products Segment; and,
ultimately, its ability to achieve profitable operations. During
the nine months ended September 30, 2002, the Company received
$1,051,512 in debt and equity financing and is currently
addressing several additional financing sources. However, there
can be no assurances that additional financing can be obtained
on conditions considered by management to be reasonable and
appropriate.


SHEFFIELD PHARMACEUTICALS: Renegotiates $475K of Unsecured Debt
---------------------------------------------------------------
Sheffield Pharmaceuticals, Inc., (Amex: SHM) successfully
negotiated the amendment and restatement of all of the $475,000
of promissory notes related to its unsecured debt issued on
September 6, 2002 with certain shareholders of the Company.

The amended and restated promissory notes provide for interest
at the rate of 7% per annum and mature on May 15, 2003.  Upon
maturity of $225,000 of the notes, the Company will repay
principal and accrued interest on each Amended Note, and at the
Company's discretion, either a premium of approximately 14% of
the principal amount, or issue a warrant to purchase the number
of shares of Sheffield common stock equal to the principal
amount each Amended Note.  Any warrants issued under the Amended
Notes will have an exercise price of $.19 per share, the closing
price of the Company's common stock on the closing date of the
Amended Notes.  Upon maturity of $250,000 of the Amended Notes,
the Company will repay principal and accrued interest on each
Amended Note, and at the Company's discretion, either a premium
of approximately 28% of the principal amount, or issue warrants
to purchase an aggregate of 500,000 shares of the Company's
common stock, of which 250,000 shares will have an exercise
price of $.60 per share, and 250,000 shares will have an
exercise price of $.19 per share.

Upon amending and restating certain of these notes, the Company
issued to certain noteholders warrants to purchase a total of
225,000 of the Company's common stock at an exercise price of
$.60 per share.

Sheffield Pharmaceuticals, Inc., provides innovative, cost-
effective pharmaceutical therapies by combining state-of-the-art
pulmonary drug delivery technologies with existing and emerging
therapeutic agents.  Sheffield is developing a range of products
to treat respiratory and systemic diseases using pressurized
metered dose, solution-based and dry powder inhaler and
formulation technologies, including its proprietary Premaire(R)
Delivery System and Tempo(TM) Inhaler.  Sheffield focuses on
improving clinical outcomes with patient-friendly alternatives
to inconvenient or sub-optimal methods of drug administration.
Investors can learn more about Sheffield Pharmaceuticals on its
Web site at http://www.sheffieldpharm.com

                           *    *    *

At September 30, 2002, the Company's balance sheet shows a total
shareholders equity deficit of about $14 million, as compared to
a deficit of $9 million recorded at December 31, 2001.

As of November 14, 2002, the Company had cash and equivalents of
approximately $.7 million and accounts payable and accrued
liabilities of $2.9 million. Unless the Company is able to raise
significant capital ($1 million to $2.5 million) within the next
60 days, management believes that it is unlikely that the
Company will be able to meet its obligations as they become due
and to continue as a going concern. To meet this capital
requirement, the Company is evaluating various financing
alternatives including private offerings of the Company's
securities, other debt financings, collaboration and licensing
arrangements with other companies, and the sale of non-strategic
assets and/or technologies to third parties. Should the Company
be unable to meet its capital requirement through one or more of
the above-mentioned financing alternatives, the Company may file
for bankruptcy or similar protection under the 1978 Bankruptcy
Code.


SMTC CORP: Will Host Q4 Results Teleconference on February 13
-------------------------------------------------------------
SMTC Corporation (Nasdaq: SMTX) (TSX: SMX), a global electronics
manufacturing services (EMS) provider, scheduled its fourth
quarter results teleconference.

The teleconference will be held on February 13, 2003 at 5:00 PM
EST. Those wishing to listen to the teleconference should access
the webcast at the investor relations section of SMTC's Web site
http://www.smtc.com A rebroadcast of the webcast will be
available on SMTC's Web site following the teleconference.
Participants should assure that they have a current version of
Microsoft Windows Media Player before accessing the webcast.

Members of the investment community wishing to ask questions
during the teleconference may access the teleconference by
dialing 416-640-4127 or 888-881-4892 ten minutes prior to the
scheduled start time. A rebroadcast will be available following
the teleconference by dialing 416-640-1917 or 877-289-8525, pass
code 233347 followed by the pound key.

SMTC Corporation, whose corporate credit and senior secured bank
loan are rated by Standard & Poor's at B, is a global provider
of advanced electronic manufacturing services to the technology
industry. SMTC offers technology companies and electronics OEMs
a full range of value-added services including product design,
procurement, prototyping, printed circuit assembly, advanced
cable and harness interconnect, high precision enclosures,
system integration and test, comprehensive supply chain
management, packaging, global distribution and after-sales
support. SMTC is a public company incorporated in Delaware with
its shares traded on the Nasdaq National Market System under the
symbol SMTX and on The Toronto Stock Exchange under the symbol
SMX. Visit SMTC's Web site, http://www.smtc.com for more
information about the Company.


STAR TELECOMMS: Entry of a Final Decree Deferred to Jan. 9, 2004
----------------------------------------------------------------
Acting on a request by the Star Creditors' Liquidating Trust to
delay automatic entry of a final decree closing Star
Telecommunications' chapter 11 case, the U.S. Bankruptcy Court
for the District of Delaware extended the time within which the
Liquidating Trustee must file a final report through January 9,
2004.  Consequently, the automatic entry of a final decree
mandated by the Court is deferred to that date.

As previously reported in the Troubled Company Reporter on
August 12, 2002, all of the Debtors' assets were transferred to
a liquidating trust under a confirmed chapter 11 Plan.  That
Liquidating Plan, as reported in the September 17, 2002 edition
of the TCR, was declared effective on August 13, 2002.
Thereafter, STAR was deemed dissolved under applicable state
laws.

Star Telecommunications, Inc., was a leading provider of global
telecommunications services to consumers, long distance
carriers, multinational corporations and Internet service.


STEEL DYNAMICS: Posts Improved 2002 Full-Year Financial Results
---------------------------------------------------------------
Steel Dynamics, Inc., (Nasdaq: STLD) whose corporate credit is
rated by Standard & Poor's at 'BB-', announced record annual
earnings for 2002 of $78 million compared to $3 million in 2001.
Record net sales for the year 2002 were $864 million with
consolidated shipments of 2.4 million tons, compared to net
sales of $607 million and consolidated shipments of 2.0 million
tons for 2001. SDI's average consolidated selling price per ton
was $362, or 17 percent higher in 2002 as compared to $309 per
ton in 2001.

"Steel industry market and competitive conditions improved
dramatically in 2002," said Keith Busse, president and chief
executive officer, "and Steel Dynamics was in a great position
to take advantage of the opportunities presented. After several
large steel companies entered bankruptcy, with some shutting
down, Steel Dynamics and other steelmakers benefited from
reduced domestic steel supplies and the U.S. government's
Section 201 action. These factors, as well as favorable trade-
case rulings, contributed to stabilizing the domestic steel
market during the year 2002."

The company's Flat Roll Division at Butler, Indiana, achieved
record annual hot band production of 2.4 million tons, exceeding
previous estimates of the mill's annual production capacity.
Productivity improved to 0.31 man-hours per ton of hot band
steel produced. Consolidated operating profit per ton shipped
(excluding start-up costs and extraordinary items) increased to
$74 per ton for the year, and reached a quarterly record of $98
per ton in the fourth quarter.

During 2002, SDI's start-up costs were $13 million, primarily
related to the structural and rail manufacturing facility, which
began operations midyear 2002. Capital expenditures were $143
million, which includes the $45 million purchase cost of the
Pittsboro, Indiana, mini-mill assets from Qualitech Steel SBQ,
LLC in September 2002. All litigation related to the purchase of
this asset has now been resolved.

"Steel Dynamics is one of the lowest cost flat-roll steel
producers in existence today, which helps us to achieve strong
profit margins," Busse said. "We expect to maintain that cost
leadership with our entry into the long products steel markets.
In 2002 we completed construction of our second mini- mill, the
structural and rail mill in Columbia City, Indiana. We began
production in July 2002 and are now producing a wide range of
structural steel products. Rail production trials are set to
begin in the first half of 2003.

"We are also looking toward additional future growth, starting
in 2004, from our newly-formed Bar Products Division mini-mill
in Pittsboro, Indiana. We expect permitting, engineering and
retrofitting activities will continue throughout 2003. We plan
initially to produce merchant shapes, with the possibility of
manufacturing SBQ bars in the future. The purchase of this
relatively new mill at a very reasonable price provides SDI with
an attractive entry into a new product field. We continue to
review other growth opportunities, with an eye for value and
future profit growth potential," Busse said.

                  Fourth Quarter 2002 Highlights

SDI's net sales for fourth quarter 2002 were $243 million, with
consolidated shipments of 603,000 tons, in comparison to sales
of $138 million and consolidated shipments of 465,000 tons
during the same period in 2001. SDI's average consolidated
selling price for the quarter was $403 per ton, compared to $297
per ton in the fourth quarter of 2001, a 36 percent increase.
Capital expenditures in the quarter were $18 million, primarily
related to work at the structural and rail manufacturing
facility at Columbia City.

"Our fourth quarter was another record quarter as it would
regard operating profit per ton," Busse commented, "Excluding
the costs related to debt extinguishment for the issuance of
convertible notes in December, which reduced earnings by
approximately $0.03 per share, SDI's diluted earnings per share
in the fourth quarter would have been $0.64.

"In late December 2002 and early January 2003 the company
successfully issued $115 million of 4.0% Convertible
Subordinated Notes due 2012. The net proceeds received from this
issuance were used to prepay approximately 40 percent of our
then outstanding senior secured bank facility. We believe this
transaction further supports our commitment to continually
strengthen our capital structure while maintaining the financial
flexibility necessary to accommodate our growth strategies."

Steel Dynamics, Inc., based in Fort Wayne, Indiana, produces a
broad range of flat-rolled and long steel products. Flat-roll
products include hot-band, cold-rolled and coated steel sheet.
The company emphasizes value-added coated and light-gauge,
micro-alloyed and high-strength steels at its Flat Roll Division
mini-mill in Butler, Indiana. In 2002 the company's Structural
and Rail Division began producing and shipping structural steel
products from its new mini-mill at Columbia City, Indiana.


SUN MEDIA CORP: Full-Year 2002 Results Show Marked Improvement
--------------------------------------------------------------
Sun Media Corporation, a subsidiary of Quebecor Media Inc.,
itself a subsidiary of Quebecor Inc. (TSX: QBR.A, QBR.B),
recorded revenues of $853.6 million in 2002, compared with
$838.1 million in 2001, an increase of $15.5 million or 1.8%.
Increases of 4.0% and 2.1% in advertising revenues and
circulation revenues, respectively, were partially offset by a
decrease in commercial printing revenues. EBITDA increased by
$21.5 million, or 10.7%, to $222.3 million, with a 19.6%
increase in EBITDA among urban dailies. Sun Media's operating
margin was 26.0% in 2002, compared to 24.0% in 2001, due
primarily to a reduction in newsprint prices and effective cost-
containment measures introduced in 2001 and continued in 2002.
These factors were, however, partially offset by a $5.1 million
management fee to Quebecor Media, and higher payroll expenses as
a result of normal wage increases, higher pension and benefit
costs, and staffing for new publications, as well as other costs
relating to investments in distribution operations.

Sun Media's net income totaled $309.2 million in 2002, compared
with $152.5 million in 2001. In accordance with new accounting
rules, no charge for amortization of goodwill was recorded in
2002. Excluding amortization of goodwill, net income would have
been $172.6 million in 2001. The increase in net income was due
primarily to an increase in dividend income from $95.3 million
in 2001 to $203.2 million in 2002, due to the full-year
realization of an investment in July 2001 and an additional
investment in November 2002 in preferred shares of Quebecor
Media. To a lesser extent, the increase in net income was due to
the factors discussed in the paragraph above, as well as a
reduction in restructuring charges of $15.6 million and a
reduction in financial expenses of $8.8 million in 2002 as a
result of lower interest rates and decreased debt levels.

Interest on convertible obligations issued in July 2001 and in
November 2002 to Quebecor Media, which is charged to retained
earnings, increased from $92.7 million in 2001 to $197.4 million
in 2002, before income tax benefits of $34.3 million and $69.0
million, respectively.

Sun Media Corporation, a subsidiary of Quebecor Media Inc.,
itself a subsidiary of Quebecor Inc., is the second largest
newspaper publishing company in Canada, publishing 15 paid daily
newspapers and serving 8 of the top 11 urban markets in Canada.
Sun Media also publishes 175 weekly newspapers and shopping
guides and 18 speciality publications.

A copy of Sun Media's Consolidated Financial Statements for 2002
are available at http://www.quebecor.com

As reported in Troubled Company Reporter's December 12, 2002
edition, Standard & Poor's raised its senior secured debt rating
on publishing company Sun Media Corp., to 'BB-' from 'B+'. The
rating action affects the company's C$376.8 million senior
secured bank facility. In addition, the ratings on Quebecor
Media Inc., including the single-'B'-plus long-term corporate
credit rating, and its subsidiaries, including Sun Media and
Videotron Ltee, remain on CreditWatch with negative
implications.

The ratings on Toronto, Ontario-based Sun Media are equal to
those on its 100% parent, Quebecor Media, reflecting the parent-
subsidiary relationship between the two entities, including
Quebecor Media's control over Sun Media's business strategy,
financial policies, and application of free cash flows.

The ratings upgrade on Sun Media's secured debt to one notch
above the corporate credit rating reflects Standard & Poor's
review of recovery prospects and potential causes of default
relative to the reduced size of the credit facility and the
value of Sun Media's assets. In particular, given Sun Media's
moderately strong business and financial profile, the risk of
default is partially driven by the relatively high leverage of
the Quebecor Media group.


SYBRON DENTAL: Reports Strong Fiscal First Quarter Results
----------------------------------------------------------
Sybron Dental Specialties, Inc. (NYSE: SYD), a leading
manufacturer of value-added products for the dental and
orthodontic professions and products for use in infection
prevention, announced its financial results for its first fiscal
quarter ended December 31, 2002.

                        First Quarter Results

Net sales for the first quarter of fiscal 2003 totaled $120.1
million, compared to $97.8 million in the prior year period, an
increase of 22.8%. Sybron's total internal growth rate was 15.2%
for the first quarter, and 9.4% for consumables. The internal
growth rate for equipment was 183%, which was driven by initial
stocking of the Company's new Demetron curing light by its
distribution partners. Consumable supplies represented 92% of
total sales in the first quarter.

Net income for the first quarter of fiscal 2003 was $9.6
million, an increase of 27% over net income of $7.5 million in
the same period of the previous year.

Effective October 1, 2002, Sybron adopted Statement of Financial
Accounting Standards No. 142, "Goodwill and Other Intangible
Assets," and is no longer amortizing its goodwill.

Sybron generated $21.4 million in free cash flow, defined as
operating cash flow minus capital expenditures, in the first
quarter. This represents an increase of 328% over free cash flow
of $5.0 million in the same period of the previous year.

"We are beginning to see the positive impact of the changes we
made throughout the organization in the second half of the last
fiscal year," said Floyd W. Pickrell, Jr., Chief Executive
Officer of Sybron Dental Specialties. "We saw strong internal
growth by our Kerr subsidiary of 21% this quarter as our dental
distribution partners have responded well to our more focused
end-user promotions. We have dedicated additional resources to
our marketing efforts at Kerr, and we are providing our
distributors with enhanced collateral and educational materials
to help their sales organizations present our products to their
customers in a more effective manner. Most importantly, we saw a
consistent order flow throughout the quarter, and we believe the
inventory position of our distributors bodes well for a
continuation of this pattern.

"Our Ormco subsidiary also had a very strong quarter with 8.1%
internal growth. These results were driven largely by increasing
sales of our high-end brackets. We continue to improve our
ability to manufacture these brackets in larger quantities. As
we continue to increase production volumes, we will expand our
marketing efforts related to the high-end brackets to capitalize
on the growing demand that exists in the marketplace," said Mr.
Pickrell.

                First Quarter Financial Highlights

Gross margins in the first quarter of 2003 were 53.7%, compared
with 55.9% in the first quarter of 2002 and 55.0% in the fourth
quarter of 2002. Gross margins were negatively impacted by
unabsorbed overhead at the production facilities of our Ormco
subsidiary.

Selling, general and administrative expenses before amortization
(SG&A) were $42.7 million, or 35.6% of net sales, in the first
quarter, compared with $32.7 million, or 33.4% of net sales, in
the same period of the prior year. SG&A expenses increased over
the prior year due to increased incentive compensation and bonus
expenses over the previous year, the expansion of the Company's
sales force over the past year, additional resources dedicated
to marketing activities, and a higher cost structure required
for the operations of Orascoptic (acquired in February 2002).

Research and development expenditures were $2.7 million in the
first quarter of 2003, compared to $2.6 million in the same
period in the prior year.

Operating income for the first quarter of 2003 was $21.5
million, compared to $19.5 million in the first quarter of 2002.
Earnings before interest, taxes, depreciation and amortization
(EBITDA) for the quarter were $24.7 million. EBITDA was 20.6% of
net sales for the quarter. Cash flow from operations was $22.1
million, compared with $8.2 million in the first quarter of
2002.

Depreciation and amortization expense for the first quarter was
$3.3 million. Capital expenditures were approximately $730,000
for the quarter. The majority of the Company's capital spending
is scheduled for later in the fiscal year, and total capital
expenditures for fiscal 2003 are expected to be $15.3 million.

Net trade receivables were $80.6 million and days sales
outstanding (DSOs) were 60.9 days at December 31, 2002, which
compares with 59.0 days at September 30, 2002 and 68.3 days at
December 31, 2001. Net inventory was $87.3 million at the end of
the first quarter and inventory days were 153 days, which
compares to 161 days at September 30, 2002 and 171 days at
December 31, 2001. The decrease in inventory days is primarily
attributable to an increased focus on inventory management by
each subsidiary.

Please refer to the supplemental schedules provided on the
Financial Report's section of Sybron's Investor Relations Web
site -- http://www.sybrondental.com/investors/pubs.html-- that
detail the calculation of the Company's DSOs and inventory days.

Sybron's average credit facility debt outstanding for the
quarter was approximately $322.9 million and the Company's
average interest rate on the debt was 6.18%. The Company paid
down $9.8 million of debt in the first quarter and total debt
outstanding was approximately $331.0 million at December 31,
2002.

Cash and cash equivalents were $21.8 million at December 31,
2002, an increase from $12.7 million at September 30, 2002.

               Amendment to Senior Credit Facility

Sybron announced that its senior credit facility has been
amended to give the Company the flexibility to initiate a stock
buyback program for up to $25 million of its common stock. The
Company has no present intention to make any purchases of its
common stock.

                            Outlook

For the second quarter of fiscal 2003, Sybron expects revenue to
range from $124 million to $131 million, and diluted earnings
per share to range from $0.35 to $0.38. The Company also
reaffirmed that it is comfortable with the current consensus
analyst estimates for full fiscal year 2003 earnings per share.

"While we expect to show sequential quarter revenue growth in
the second quarter, our year-over-year organic growth will be
flat to marginally higher," said Mr. Pickrell. "We have a
particularly tough comparison in the second quarter as our Kerr
subsidiary had 9% organic revenue growth last year, well above
the market growth rate. However, we expect our Ormco subsidiary
to continue showing improvement and post good organic growth
once again.

"Beyond the second quarter, the outlook for the remainder of the
year looks promising, with healthy demand in each of our end
markets. We expect to continue to drive additional revenue
growth as we introduce several new products this year, we
increase marketing activities for our high-end brackets, and the
infection prevention product line gains traction under Kerr's
management. We also expect to achieve higher profit margins
later in the year as our gross margin gradually improves due to
increasing capacity utilization at the Ormco facilities, and
SG&A trends down as a percentage of sales following a temporary
ramp-up in marketing expenses this quarter to provide
distributors with enhanced sales tools."

Sybron Dental Specialties and its subsidiaries are leading
manufacturers of value-added products for the dental and
orthodontic professions and products for use in infection
control. Sybron Dental Specialties develops, manufactures, and
sells through independent distributors a comprehensive line of
consumable general dental and infection prevention products to
the dental industry worldwide. It also 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
spin-off.


THERMOGENESIS CORP: Atlas II et. al. Disclose 6.8% Equity Stake
---------------------------------------------------------------
Atlas II, L.P., Pentagram Partners, L.P., and Richard Jacinto,
II, General Partner, beneficially own 6.8% of the outstanding
common stock of Thermogenesis Corporation by virtue of the
holding of 2,427,910 shares of that Company's common stock.
While Atlas II holds no voting or dispositive powers over the
stock, Pentagram Partners and Mr. Jacinto have sole powers of
voting and disposition of the stock.

The holding includes 1,844,425 shares of common stock and
Warrants to purchase 583,485 shares of common stock exercisable
within 60 days.

                          *    *    *

                Liquidity and Capital Resources

The Company, in its SEC Form 10-Q filed on November 12, 2002,
reported:

At September 30, 2002, the Company had a cash balance of
$4,200,000, short term investments of $1,013,000 and working
capital of $8,348,000.  This compares to a cash balance of
$4,713,000, short term investments of $2,013,000 and working
capital of $9,631,000 at June 30, 2002. The cash and short-term
investments were used to fund operations and other cash needs of
the Company.  In addition to product revenues, we have primarily
financed our operations through the private placement of equity
securities.  Since its inception, the Company has raised
approximately $51 million, net of expenses, through common and
preferred stock financings and option and warrant exercises.  As
of September 30, 2002, the Company has no off-balance sheet
arrangements.

The report of independent auditors on the Company's June 30,
2002 financial statements includes an explanatory paragraph
indicating there is substantial doubt about the Company's
ability to continue as a going concern.

At September 30, 2002, the Company has $1.5 million outstanding
in cancelable orders to purchase inventory, supplies and
services for use in normal business operations and no
significant outstanding capital commitments.


UBIQUITEL: Issuing New 14% Senior Notes via Private Placement
-------------------------------------------------------------
UbiquiTel Operating Company, a wholly-owned subsidiary of
UbiquiTel Inc. (Nasdaq: UPCS), intends to offer, in a private
placement, up to $56,250,000 aggregate principal amount of its
new 14% Senior Discount Notes due May 15, 2010 for up to
$225,000,000 principal amount of its outstanding 14% Senior
Subordinated Discount Notes due April 15, 2010.

The company is offering to issue $250 in principal amount of New
Notes for each $1,000 principal amount of Existing Notes validly
tendered and accepted up to a maximum of $225,000,000 principal
amount of Existing Notes.  In addition, the company is offering
to pay $50 in cash for each $1,000 principal amount of Existing
Notes validly tendered prior to 5:00 p.m., EST, on Wednesday,
February 5, 2003, and accepted by the company.  If more than
$225,000,000 in aggregate principal amount of Existing Notes are
validly tendered prior to the expiration date, the company will
accept tenders from holders on a pro rata basis.

The New Notes to be issued in the offer will be senior unsecured
obligations of the company, will be guaranteed on a senior
unsecured basis by UbiquiTel Inc., and all of the company's
existing and future restricted subsidiaries and will rank senior
to the Existing Notes (and guarantees thereof) that remain
outstanding after the consummation of the offer.

The exchange offer will expire at 5:00 p.m., EST, on Friday,
February 21, 2003, unless extended.

The offer is subject to the receipt of requisite consents of the
lenders under the company's senior secured credit facility,
completion of a new financing on terms acceptable to the company
to fund the cash portion of the offer and certain other general
conditions.

The offer is only being made inside the United States to
investors who are qualified institutional buyers or accredited
investors, and outside the United States to non-U.S. persons.
The New Notes have not been registered under the Securities Act
of 1933, as amended, and may not be offered or sold in the
United States absent registration or an applicable exemption
from registration requirements.  The company will enter into a
registration rights agreement pursuant to which it will agree to
file an exchange offer registration statement with the
Securities and Exchange Commission under which the New Notes may
be exchanged for registered notes having substantially identical
terms.

The company has reached an agreement in principle with its
lenders under its senior secured credit facility for their
consent to the offer.  The lenders are conditioning their
consent on the company being able to finance the entire cash
portion of the offer through a new financing as described below.

In conjunction with the consent, the lenders also have sought
modifications through an amendment to the senior secured credit
facility, which the company expects to include a $15 million
partial prepayment against the outstanding $245 million
principal balance of term loans, a $5 million permanent
reduction in the unused $55 million revolving line of credit and
the company entering into a letter of intent to sell certain
non-core tower assets.  The company expects to use the
anticipated combined proceeds of approximately $20 million from
the tower assets sale and a previously reported income tax
refund expected to be monetized in 2003 to offset the
anticipated amount to be prepaid on the company's outstanding
terms loans.  However, there is no assurance that the company
will either complete the assets sale or receive the tax refund.
The conditions under the pending senior secured credit facility
amendment to prepay a portion of outstanding term loans and
reduce the unused revolving line of credit will be contingent
upon the consummation of the offer.

The company also has reached an agreement in principle with
certain accredited investors (some of whom are directors of the
company's parent UbiquiTel Inc.) for a new financing to raise
the $11.25 million cash portion of the offer in a private
placement, which it anticipates will involve the issuance of
approximately $15 million aggregate principal amount of the
company's 14% senior discount notes due 2008 which will rank
pari passu in right of payment to the New Notes being offered in
the offer, and which will have customary covenants and terms.
The company expects that warrants to purchase 11.25 million
shares of UbiquiTel Inc.'s common stock will be issued to the
investors in conjunction with the new financing.  The closing of
the private placement of notes and warrants will be contingent
upon the consummation of the offer and the concurrence of The
Nasdaq Stock Market, Inc. with respect to UbiquiTel Inc.'s
interpretation of certain shareholder approval requirements in
connection with warrants to be issued to participating
directors.  The notes and warrants will not be registered under
the Securities Act of 1933, as amended, and may not be offered
or sold in the United States absent registration or an
applicable exemption from registration requirements.

                          *      *      *

As previously reported, Standard & Poor's lowered its corporate
credit ratings on UbiquiTel Inc., and unit UbiquiTel Operating
Co., to triple-'C'-plus from single-'B'-minus.

At the same time, Standard & Poor's lowered its bank loan rating
on UbiquiTel Operating to triple-'C'-plus from single-'B'-minus
and its subordinated debt rating on the company to triple-'C'-
minus from triple-'C'. The ratings on both companies were placed
on CreditWatch with negative implications.

"The rating downgrade reflects the continued impact of the Clear
Pay customers on churn rate and cash flow measures in the near
term, together with overall slower subscriber growth anticipated
by Standard & Poor's. Although the company's bank covenants were
modified in July 2002, the CreditWatch placement reflects the
potential for the company not meeting the minimum subscribers
covenant over the next six months due to high churn and lower
net customer additions," said Standard & Poor's credit analyst
Rosemarie Kalinowski.


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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

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

Deloitte will charge base fees for services at their hourly
rates:

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

For other services, or if Deloitte is required to perform
unanticipated work, Deloitte will charge fees based on its
regular hourly rates:

            Partner/Director             $570 to 620
            Senior Manager                420 to 500
            Manager                       250 to 480
            Senior                        250 to 360
            Staff                         230 to 260
            Paraprofessional               75 to 125
(United Airlines Bankruptcy News, Issue No. 6; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


UNITED STATIONERS: Will Publish Q4 and 2002 Result Tomorrow
-----------------------------------------------------------
United Stationers Inc., (Nasdaq: USTR) will report 2002 fourth
quarter and year-end results tomorrow after the close of the
market.  In connection with the earnings release, United
Stationers will host a conference call which will also be
broadcast over the Internet on January 31 at 9:00 a.m.
Central Time.  Leading the call will be Dick Gochnauer,
president and chief executive officer.

To participate, callers within the U.S. and Canada should dial
(888) 662-9709 and International callers should dial (773) 756-
0629 approximately ten minutes before the time of the
presentation.  The passcode is "Year-End Results".  To listen to
the Webcast via the Internet, participants should visit the
investor relations section of the company's Web site at
http://www.unitedstationers.comat least 15 minutes prior to the
event's broadcast.  Then, follow the instructions provided to
assure that the necessary audio application is downloaded and
installed.  Windows Media Player is required to listen to this
Webcast.  This program can be obtained at no charge to the user.
In addition, interested parties can access an archived version
of the call, which will also be located on the investor
relations section of United Stationers' Web site approximately
two hours after the conclusion of the call.

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
http://www.unitedstationers.com

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 reported in Troubled Company Reporter's January 15, 2003
edition, Standard & Poor's affirmed its 'BB' corporate credit
rating on United Stationers Supply Co., and revised its outlook
on the company to negative from positive.

Approximately $248 million of the Des Plains, Illinois-based
company's debt is affected by this action.

The outlook change is based on United Stationers' revised
earnings guidance for the fourth quarter of 2002 and Standard &
Poor's expectations that the company's performance for the full
year will be well below 2001.


US AIRWAYS: Intends to Pull Plug on Orlando Airport Lease Pact
--------------------------------------------------------------
US Airways Group Inc., and its debtor-affiliates seek the
Court's authority to reject two real property leases at the
Orlando International Airport nunc pro tunc to January 1, 2003,
and to negotiate and obtain an operating agreement from the
Greater Orlando Aviation Authority.

John Wm. Butler, Jr., Esq., at Skadden, Arps, Slate, Meagher &
Flom, tells Judge Mitchell that the Debtors and the Authority
are parties to two airline agreements where the Debtors lease 15
gates and associated ticket counter, office, baggage claim,
administrative, and club facilities at the Airport.

The Debtors are reducing the size of their operations and flight
schedule at the Airport by lowering the number of gates leased
to six, along with smaller related facilities.  With the
reductions, the other nine gates and related facilities no
longer benefit the Debtors.

The Debtors evaluated the value of the leases and the
possibility of assigning or subleasing the Real Property Leases.
But the leases simply do not have any marketable value and no
party has expressed an interest in an assignment.

The annual cost to the Debtors for the unutilized gates and
related facilities is approximately $3,000,000 and the cost over
the remaining life of the Leases is $18,000,000.  These costs
constitute an unnecessary drain on the Debtors' cash resources.

The Debtors want to negotiate and obtain an operating agreement
and ultimately a new signatory lease.  Their business plan
provides for future service at the Airport.  Therefore,
obtaining an Operating Agreement and a new long-term signatory
lease for a reduced number of gates and related facilities is in
the best interests of the Debtors' estates.

At three of the gates to be vacated, the Debtors will
temporarily leave loading bridges and other related equipment.
The Debtors want to have access to remove the Equipment.
Alternatively, the Debtors have been discussing a sale of the
Equipment to the Authority.

                      Airport Authority Objects

The Greater Orlando Aviation Authority is a public body charged
with operating the Orlando International Airport.

Roy S. Kobert, Esq., at Broad & Cassel, argues that the Debtors
do not have the authority to arbitrarily retroactively reject a
real property lease, prior to termination by the Court.  At the
Orlando International Airport, the Debtors have operationally
abandoned gates and counters while physically occupying the same
gates and counters with proprietary signage, airside equipment
and other proprietary assets.  This precludes the Aviation
Authority from enjoying any hypothetical benefit of a
retroactive rejection and re-letting.  Essentially, the Debtors
continue to occupy the space they seek to retroactively reject.

The Debtors seek to vacate Gates 30, 32, 34, 41, 43, 51, 53, 55,
57 and 59; passenger holding space and office space on the
transfer level; office space and apron space on the ramp level
as well as bag drop and bag makeup carousels on land side levels
2 and 1, along with related ticket counter stations, storage,
break room and office space.  The Motion was filed on January 9,
2003.

According to Mr. Kobert, the situation is made more difficult by
the fact that it is still fluid.  As of January 10, 2003, the
Debtors said they would retain an additional 6,000 square feet
of storage and office space underneath the air terminal HUB and
behind its counters.  Mr. Kobert notes that the Debtors did not
reveal their intentions to vacate 10 ticketing positions until
three business days prior to the Motion; the same ticketing
positions it periodically utilizes during its peak times.

Unlike vacating commercial office space, the return of gates
requires physical transformation prior to re-letting.  Each
returned gate would require installation of common use computer
equipment at the counter, installation of customer seating and
new VisionTron signage at the gate and ticket counters to
provide directional and information to the flying public.  This
physical transformation takes approximately 90 days.

The Debtors contend that they are in the process of vacating the
premises.  They do not allege that they have vacated the
premises.  In fact, the Debtors have failed to fully vacate the
premises they wish to reject.  Specifically, the Debtors
maintain signage at all ticket counters and continue to use them
for check-in purposes.  The office space behind these counters
is also fully utilized as offices, break rooms, and storage
areas containing tickets, bag tags, sales reports, decorations,
sky kennels and other general supplies.  Additionally, on the
airside, loading bridges attached to Gates 53 and 55 contain US
Airways signage, as do the holdroom areas of Gates 55 and 57.
Furthermore, US Airways continues to use the ramp level under
Gates 53, 55, and 57 for office space and storage of equipment
like fuel and lavatory trucks, tugs, baggage carts, push back
equipment, air stairs, ice machine, and office furniture.  The
6,000-square foot storage facility under airside 3 contains
cabin service supplies, boxes and holdroom seating, and an
active computer system.  As a result, the Debtors are
effectively excluding the Aviation Authority from re-letting the
premises.

As for negotiating and entering a new Operating Agreement, the
Aviation Authority asserts that no court approval is required.
This is especially true since there is no existing, executed
contract to be approved at the scheduled hearing or to circulate
amongst the Unsecured Creditors' Committee or other interested
parties.  Alternatively, the Aviation Authority suggests that
the Debtors seek an adjournment of the rejection hearing to
allow execution and approval of a limited Space and Use
Agreement and avoid the urgency that the parties are currently
operating under. (US Airways Bankruptcy News, Issue No. 21;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


US MINERAL PRODUCTS: Delaware Court Fixes Feb 20 Claims Bar Date
----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware fixes
February 20, 2002, as the Claims Bar Date -- the deadline for
creditors of U.S. Mineral Products Company d/b/a Isolatek
International to file their proofs of claim against the Debtor
or be forever barred from asserting their claim.

Proofs of claim must be received by the Debtor's Claims Agent
before 5:00 p.m. Eastern Time on Feb. 20.  Claims must be mailed
to:

      Bankruptcy Services LLC
      P.O. Box 5016 - FDR Station
      New York, NY 10150-5016

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

      i. Claims already properly filed with or USM's Claims
         Agent, Bankruptcy Services LLC; and

     ii. Claims not listed as disputed, contingent and
         unliquidated.

The United States Mineral Products Company manufactures and
sells spray-applied fire resistive material to the constructions
industry in North America and South America. The Company filed
for Chapter 11 protection on July 23, 2001. Aaron A. Garber,
Esq., David M. Fournier, Esq., and David B. Stratton, Esq., at
Pepper Hamilton LLP, represent the Debtor in its restructuring
efforts.


U.S. STEEL: Extends Sourcing Agreement with Procuri by 3 Years
--------------------------------------------------------------
Continuing its 100 percent renewal rate, Procuri, Inc.,
announced that United States Steel Corporation (NYSE: X),
headquartered in Pittsburgh, has signed a three-year extension
to its agreement to use Procuri's solution.  Citing ease-of-use
and state-of-the-art functionality, U.S. Steel plans to expand
its user base and train more buyers and suppliers on the tool.

"We have been impressed with Procuri's software and the support
our organization receives," said John W. Shaver, Manager,
Purchasing-Energy and Headquarters' Services at U.S. Steel.
"Outside of its functionality, the Procuri team consistently
listens to our feedback and promptly responds in future
versions.  It's rare to find a company so in touch with its
customers."

U.S. Steel uses Procuri 4.0(TM) to improve supplier
communications and buyer efficiency.  Developed from the
perspective of purchasing professionals, Procuri 4.0 gives U.S.
Steel an effective e-commerce tool to run and manage online bid
events.  Since March 2002, fifty users have been trained at U.S.
Steel and many events have been conducted with very positive
results.

"U.S. Steel's agreement extension and our 100 percent renewal
rate speak directly to our customer support capabilities,
functionality enhancements and the flexibility of our solution,"
said Mark F. Morel, Sr., Procuri's president and chief executive
officer.  "In a marketplace with many varied sourcing solution
providers, Procuri continues to gain new customers, extend its
current relationships and increase its worldwide market share."

Procuri delivers strategic e-sourcing solutions, services and
knowledge to Global 2000 enterprises.  Customers report average
cost savings of nearly 25 percent in the procurement of direct
and indirect materials and services and cycle time reductions of
up to 75 percent.  Procuri has more than 50 customers including
Procter & Gamble, Eastman Kodak, ITT Industries, KLM Royal Dutch
Airlines, Rio Tinto and U.S. Steel.  For more information, call
1-877-360-1660 or visit http://www.procuri.com

As reported in Troubled Company Reporter's January 13, 2002
edition, Standard & Poor's placed its 'BB' corporate credit
rating on United States Steel Corp. on CreditWatch with negative
implications following the company's announcement that it plans
to acquire substantially all of bankrupt National Steel Corp.'s
steelmaking and finishing assets.

"Although the acquisition of National Steel would improve the
United States Steel's market position and result in annual
synergies of $170 million in two years", said Standard & Poor's
credit analyst Paul Vastola, "Standard & Poor's is concerned
that these benefits may be more than offset by weaker credit
protection measures given the increase in debt leverage,
declining steel prices and increasing pension costs at USS". Mr.
Vastola added that the acquisition of National and the expected
sale of United States Steel's more stable mining and
transportation assets to Apollo Management LP would be somewhat
detrimental to the company's business profile.


USG CORP: Will Publish Fourth Quarter 2002 Results on Monday
------------------------------------------------------------
USG Corporation will report its Fourth Quarter 2002 Earnings
during the week of February 3, 2002, prior to the market open.

For additional information, please visit:

http://investor.usg.com/redesign/calendar.cfm?CompanyID=USG
(USG Bankruptcy News, Issue No. 41; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


VALLEY MEDIA: Court Okays Exclusivity Extension through Feb. 12
---------------------------------------------------------------
By order of the U.S. Bankruptcy Court for the District of
Delaware, Valley Media, Inc., obtained an extension of its
exclusive periods.  The Court gave the Debtor, until
February 12, 2003, the exclusive right to file its plan of
reorganization, and until April 14, 2003, to solicit acceptances
of that Plan from creditors.

Valley Media Inc, a distributor of music and video entertainment
products, filed for chapter 11 protection on November 20, 2002.
Neil B. Glassman, Esq., Steven M. Yoder, Esq., and Christopher
A. Ward, Esq. at The Bayard Firm represent the Debtor in its
restructuring efforts. When the Company filed for protection
from its creditors, it listed $241,547,000 in total assets and
$259,206,000 in total debts.


VENTAS INC: Publishing 2002 Annual Earnings by February 26, 2003
----------------------------------------------------------------
Ventas, Inc., (NYSE:VTR) will issue its 2002 annual earnings on
Wednesday, February 26, 2003. A conference call to discuss those
earnings will be held that morning at 10:00 a.m. Eastern Time
(9:00 a.m. Central Time.) The call is being webcast by CCBN and
can be accessed through the Ventas Web site at
http://www.ventasreit.comor at http://www.companyboardroom.com

      VENTAS TO PRESENT AT UBS WARBURG HEALTHCARE CONFERENCE

Ventas also announced that President and CEO Debra A. Cafaro and
Chief Financial Officer Richard A. Schweinhart will make a
presentation regarding the Company at the UBS Warburg Global
Healthcare Services Conferences on Tuesday, February 4, 2003 at
2:00 p.m. Eastern Time. The presentation is being audio webcast
and can be accessed at the Ventas Web site at
http://www.ventasreit.comor at http://www.ubswarburg.com  The
accompanying slides will also be available on Ventas's Web site
at the time of the presentation. The webcast and slides will be
archived at http://www.ventasreit.comfor 30 days after the
event.

Ventas, Inc., is a healthcare real estate investment trust that
owns 44 hospitals, 220 nursing facilities and nine other
healthcare and senior housing facilities in 37 states. The
Company also has investments in 25 additional healthcare and
senior housing facilities. More information about Ventas can be
found on its Web site at http://www.ventasreit.com

At September 30, 2002, Ventas' total shareholders' equity
deficit widened to about $126 million.


WEBVAN: Closing Webvan Operations and Webvan Bay-Area Cases
-----------------------------------------------------------
R. Todd Neilson, the Estate Representative of Webvan Group,
Inc., and its debtor-affiliates, asks the U.S. Bankruptcy Court
for the District of Delaware to enter final decrees in the cases
of Webvan Operations, Inc. (Case No. 01-2405) and Webvan Bay-
Area, Inc. (Case No. 01-2406).

Mr. Neilson points out that Section 350(a) provides that "after
an estate is fully administered and the court has discharged the
trustee, the court shall close the case."  The jointly
administered cases consist of four debtor entities: Webvan
Group, Inc., Webvan Operations, Inc., Webvan Bay-Area, Inc., and
HomeGrocer.com, Inc.  At this time, all assets of the estates of
Webvan Operations, Inc. and Webvan Bay-Area, Inc. have been
disposed of.  Consequently, the proceeds of all assets of these
two entities have been disbursed to the estate of Webvan Group,
Inc, on account of its allowed superpriority inter-company
claim.

Mr. Neilson adds that at this time, there are no motions or
adversary proceedings pending against the estates of Webvan
Operations, Inc. or Webvan Bay-Area, Inc and all reports of
operations required by Rule 2015(a)(5) have been filed.

Thus, Mr. Neilson, being the Estate Representative, concluded
that it is appropriate to seek entry of final decrees closing
the Webvan Operations, Inc. and Webvan Bay-Area, Inc. cases.

Allowing the Webvan Operations and Webvan Bay-Area cases to
remain open will only subject the estates to further
administrative liabilities, including quarterly fees owing to
the Office of the United States Trustee, Mr. Neilson adds.


WHEELING-PITTSBURGH: Committees Sign-Up Kroll Zolfo as Advisor
--------------------------------------------------------------
The Official Committee of Unsecured Noteholders of Pittsburgh-
Canfield Corporation and the Official Committee of Unsecured
Trade Creditors of Pittsburgh-Canfield Corporation ask Judge
Bodoh for entry of an order authorizing their employment and
retention, nunc pro tunc to September 6, 2002, of Kroll Zolfo
Cooper LLC, as successors in interest to Zolfo Cooper LLC.
Kroll will serve as the Committees' bankruptcy consultants and
special financial advisors.

The Chairs of the Committees remind Judge Bodoh that in January
2001 the Committees filed a joint application seeking retention
of Zolfo Cooper LLC to provide special financial advisory and
bankruptcy consulting services to the Committees, which was
granted.  Since December 27, 2000, Zolfo Cooper LLC has been
providing the Committees with advisory and consulting services.

In September 2002, Zolfo Cooper LLC closed on a transaction
whereby all of the membership interests of Zolfo Cooper
Management LLC, and Zolfo Cooper Capital LLC, were transferred
to Zolfo Cooper LLC.  The members of Zolfo Cooper LLC then
transferred all of the membership interests in that company to
Kroll, Inc., a publicly traded Delaware corporation, as the
result of which Zolfo Cooper LLC is a wholly-owned, first-tier
subsidiary of Kroll, Inc.

In addition, on the same date, 100% of the issued and
outstanding shares in Zolfo Cooper Advisors, Inc., Zolfo Cooper
Management Advisors, Inc., and Zolfo Cooper Services Inc., also
affiliates of Zolfo Cooper, LLC, has transferred to Zolfo Cooper
Holdings, Inc., and 100% of the common stock in Zolfo Cooper
Holdings, Inc., was transferred to Kroll, Inc.  On November 8,
2002, Zolfo Cooper LLC has changed its name to Kroll Zolfo
Cooper LLC.  In the interim, since September 6, 2002, Zolfo
Cooper LLC was authorized to do business under the alternate
name of Kroll Zolfo Cooper.  In the future, Zolfo Cooper Capital
LLC and Kroll Zolfo Cooper Management LLC intend to merge their
interests into Kroll Zolfo Cooper LLC.

Therefore, the Committees must re-employ and retain Kroll Zolfo
Cooper LLC nunc pro tunc to September 6, 2002, the day following
the closing on the Kroll, Inc., transaction, to serve as their
bankruptcy consultants and special financial advisors and
continue to provide the services previously provided by Zolfo
Cooper LLC on the same terms and conditions.

                        Disinterestedness

After the closing on the transaction with Kroll, Inc., Zolfo
Cooper LLC requested of Kroll, Inc., and its subsidiaries,
disclosures of its connections with parties-in-interest in this
case.  Kroll, Inc., has informed Kroll Zolfo Cooper LLC that it
has conducted a review of its professional connections.  Kevin
M. Golmont avers that Kroll Zolfo Cooper LLC has no connection
with the Debtors, their creditors, or other parties-in-interest
and does not hold any interest adverse to the Debtors' estates,
other than as previously disclosed in the prior Application.
Further, Mr. Golmont assures Judge Bodoh that the firm is a
disinterested person as defined by the Bankruptcy Code.
(Wheeling-Pittsburgh Bankruptcy News, Issue No. 33; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


WHEREHOUSE: U.S. Trustee Holding Creditors' Meeting on Feb. 28
--------------------------------------------------------------
Donald F. Walton, the Acting United States Trustee for Region
III, will convene a general meeting of creditors Wherehouse
Entertainment, Inc.  The U.S. Trustee will preside and the
meeting will be held on February 28, 2003 at 10:00 a.m., in the
J. Caleb Boggs Federal Building, 2nd Floor, Room 2112, in
Wilmington, Delaware.  This is the first meeting of creditors
required under 11 U.S.C. Sec. 341(a) in all bankruptcy cases.

All creditors are invited, but not required, to attend. This
Meeting of Creditors offers the one opportunity in a bankruptcy
proceeding for creditors to question a responsible office of the
Debtor under oath about the company's financial affairs and
operations that would be of interest to the general body of
creditors.

Wherehouse Entertainment, Inc., sells prerecorded music,
videocassettes, DVDs, video games, personal electronics, blank
audio cassettes and videocassettes, and accessories. The Company
filed for chapter 11 protection on January 20, 2003. Mark D.
Collins, Esq., and Paul Noble Heath, Esq., at Richards Layton &
Finger represent the Debtors in their restructuring efforts.
When the Company filed for protection from its creditors, it
listed $227,957,000 in total assets and $222,530,000 in total
debts.


WORLDCOM INC: Committee Seeks Approval of Kelley Drye Engagement
----------------------------------------------------------------
Committee Co-Chairperson Mark Neporent reminds the Court that on
July 29, 2002, the Official Committee of Unsecured Creditors of
Worldcom Inc., selected the law firm of Akin Gump Strauss Hauer
& Feld LLP to serve as their counsel.  In its retention papers,
Akin Gump disclosed that the Committee would be required to
retain a special counsel to represent the Committee on matters
for which Akin Gump will not act for the Committee.
Specifically, in its retention application, Akin Gump identified
circumstances where it would be unable to act for the Committee.

By this application, the Committee seeks the Court's authority
to retain Kelley Drye & Warren LLP, as special counsel, nunc pro
tunc to September 16, 2002.

By retaining Kelley Drye as Special Counsel, Mr. Neporent tells
the Court that the Committee will reasonably and responsibly
address its duties in the Potential Conflict Circumstances.  In
particular, Kelley Drye will represent the Committee in
connection with certain issues that arise in these Chapter 11
Cases involving entities that are clients of Akin Gump in
matters unrelated to these Chapter 11 Cases, as requested by the
Committee.  Kelley Drye's ability to be adverse to these
entities was a significant factor in the selection and retention
of Kelley Drye as Special Counsel.

Due to the magnitude of these Chapter 11 Cases, Mr. Neporent
admits that circumstances may exist in which neither Akin Gump
nor Kelley Drye are able to act for the Committee.  If this
occurs, Akin Gump and Kelley Drye will advise the Committee to
retain another counsel to undertake the representation on the
Committee's behalf.  In that regard, Kelley Drye discloses that
it currently represents these companies on matters wholly
unrelated to the Chapter 11 cases: American Express Corporation,
AXA Financial Inc., The Bank of New York, Bear Stearns, BT Alex
Brown, CIT, Citibank, Credit Suisse First Boston, Deutsche Bank,
Electronic Data Systems, First Union Bank (Wachovia), JPMorgan
Chase Bank, New York Life Insurance Co., United States Trust
Company of New York, Wells Fargo Bank N.A., Wilmington Trust
Company, Birch Telecommunications Inc., MPower Inc., and
Broadview Networks Inc.

Each of these entities has been included in Akin Gump's
disclosure as an entity to which Akin Gump cannot be adverse.
As a result, based on the relationships of both Akin Gump and
Kelley Drye to these companies, neither Akin Gump nor Kelley
Drye will commence or investigate causes of action by or against
these entities with respect to the Chapter 11 Cases.

However, Mr. Neporent reports that Kelley Drye currently does
not represent these companies: ABN Amro Bank N.V., American
International Group, Angelo Gordon, AOL Time Warner, Appaloosa
Management, Arthur Andersen, AT&T Corp., Bank of America, Bank
of Nova Scotia, Bank One, Barclays Capital, Bayerische
Landesbank, CIBC World Market, Credit Lyonnais, District of
Columbia Public Service Commission, Donaldson Lufkin Jenrette,
Ernst & Young, Fidelity Investments, Goldman Sachs, Hartford
Insurance, Hewlett Packard, Lazard Freres, Lehman Brothers,
Merrill Lynch, Metropolitan Life Insurance Co., Morgan Stanley,
Motorola, Paine Webber, Pershing/DLJ, PIMCO,
PricewaterhouseCoopers, Prudential Insurance Co., Q Investments,
Satellite Asset Management, Texas Natural Resources Conservation
Commission, Texas State Treasurer, UBS Warburg, United States
Department of Defense, United States Department of State, FLAG
Telecommunications Holdings, Globalstar Capital L.P., XO
Communications Inc., Adelphia Business Solutions Inc., Maxcom
Telecomunicaciones S.A. de C.V., Verado Holdings Inc., and Call-
Net Enterprises, Inc.  As a result, Kelley Drye can commence or
investigate causes of action by or against these entities with
respect to these Chapter 11 Cases, if so requested by the
Committee.

Mr. Neporent explains that the Committee has selected Kelley
Drye to serve as special counsel and to perform, as requested,
in Potential Conflict Circumstances.  The Committee believes
that Kelley Drye possesses extensive knowledge in the areas of
law relevant to these cases, and that Kelley Drye is well
qualified to represent the Committee as special counsel in
connection with Potential Conflict Circumstances.  In selecting
a special counsel, the Committee sought a counsel with
experience in large Chapter 11 cases and other debt
restructuring scenarios.  Kelley Drye has represented either
debtors or official creditors' committees in numerous Chapter 11
cases.  In addition, Kelley Drye has a broad-based practice,
including expertise in the areas of bankruptcy and
restructuring, corporate and commercial law, litigation, real
estate, and telecommunications, as well as other areas that may
be significant in these cases.

Kelley Drye Member Mark I. Bane, Esq., assures the Court that
the firm does not represent any interest adverse to the Debtors'
estates or their creditors in connection with these Chapter 11
cases.  Moreover, the partners, counsel and associates of Kelley
Drye do not have any connection with WorldCom, their estates or
any other party-in-interest, their attorneys and accountants,
the United States Trustee, or any person employed in the office
of the United States Trustee.  However, Kelley Drye currently
represents certain clients whose interests are potentially
adverse to the interests of the Debtors and the Committee.
These clients are: Adelphia Business Solutions Inc., BP, FLAG
Telecommunications Holdings, International Telecom Ltd., KMC
Telecom Inc., Lend Lease Real Estate Investments Inc., Lexington
Charles Ltd. Partners, Optus Networks Pty Limited, Pacific
Carriage Limited, Southern Cross Cables Limited, Telecom New
Zealand Limited/ TCNZ (Bermuda) Limited, and XO Communications
Inc. -- the Other Client Engagements.

Kelley Drye will establish ethical procedures to ensure that the
attorneys working on the Other Client Engagements will not
receive or have access to any materials prepared by or
distributed to Kelley Drye, on the Committee's behalf, in
connection with these cases.  In addition, no member or employee
of Kelley Drye will have communication with these attorneys with
respect to the services rendered by Kelley Drye on the
Committee's behalf.

Specifically, Kelley Drye has agreed to, and will implement, an
information-blocking mechanism between its employees working on
the WorldCom bankruptcy cases as special counsel to the
Committee and any personnel working on the Other Client
Engagements, to prevent the dissemination of any non-public
information concerning the Committee's matters that have been
received by Kelley Drye solely through the performance of
activities in connection with its role as Special Counsel.

Kelley Drye will immediately create, implement and monitor on an
ongoing basis these procedures within the Firm:

   -- a "fire wall" between the Special Counsel Personnel and the
      Other Client Personnel to block the transfer of
      Information, including communications and access to files;

   -- a copy of these procedures will be circulated to each
      present and future individual member of the Special Counsel
      Personnel, the Other Client Personnel, and the Other
      Authorized Recipients as required; and

   -- Special Counsel Personnel will not be involved in the
      matters serviced by Other Client Personnel, including
      analyses, negotiations or decisions relating directly or
      indirectly to any of the Committee's or the Debtors'
      matters.

Kelley Drye is expected to render legal services in certain
Potential Conflict Circumstances as requested by the Committee.
Specifically, Kelley Drye will:

     A. advise the Committee with respect to the Debtors' sale of
        the Pentagon City Office Complex;

     B. represent the Committee in connection with a settlement
        between WorldCom, Inc. and XO Communications, Inc.;

     C. investigate, file and prosecute litigation on the
        Committee's behalf;

     D. represent the Committee at hearings and other
        proceedings;

     E. assist the Committee in preparing pleadings and
        applications as may be necessary in furtherance of the
        Committee's interests and objectives; and

     F. perform any other legal services as may be required and
        are deemed to be in the Committee's interests in
        accordance with the Committee's powers and duties as set
        forth in the Bankruptcy Code.

Mr. Bane informs the Court that Kelley Drye intends to apply to
the Court for compensation and reimbursement of out-of-pocket
expenses, all in accordance with the provisions of the
Bankruptcy Code, the Bankruptcy Rules, the Local Rules for the
United States Bankruptcy Court for the Southern District of New
York, and any Court orders.  Kelley Drye will seek compensate
based on its standard hourly rates, which are based on each
professional's level of experience.  At present, the hourly
rates range from:

        Partners                          $300 - 590
        Counsel                            395 - 450
        Associates                         155 - 340
        Legal Assistants                   110 - 160

Kelley Drye also intends to seek reimbursement of out-of-pocket
expenses incurred, including long distance phone calls,
facsimiles, photocopying, postage and package delivery charges,
messengers, court fees, transcript fees, travel expenses,
expenses for "working meals," and computer-assisted legal
research. (Worldcom Bankruptcy News, Issue No. 18; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


WORLDCOM INC: Intends to Sell Douglas Lake Ranch in Canada
----------------------------------------------------------
WorldCom, Inc., (WCOEQ, MCWEQ) announced that Douglas Lake
Ranch, the largest working cattle ranch in Canada and a premier
recreational property, will be sold.

WorldCom obtained control of the ranch in January 2003 through
the exercise of certain rights arising under financing
agreements entered into between WorldCom and Bernard J. Ebbers,
the company's former CEO.

Located in Nicola Valley in British Columbia's southern
interior, the Douglas Lake Ranch is world-renowned for the
quality of its cattle and horses. As the largest privately owned
ranch in Canada, and reputedly one of the largest ranches in the
world, the Douglas Lake Ranch is an integral part of Canada's
ranching history.  While the cattle operation remains a
significant focus, the ranch in recent years has diversified and
broadened its base of operations to include world-class fly-
fishing, recreation facilities, timber and logging operations
and other related businesses.

Hilco Real Estate, LLC and Colliers International are jointly
marketing the property for sale.  "The purchase presents an
opportunity for a buyer of the Douglas Lake Ranch to participate
in a unique piece of Canada's ranching heritage and to own one
of the most stunning and pristine pieces of land in North
America," said Mitchell Kahn, President of Hilco Real Estate.

To inquire about the purchase of the property, please contact
Mark Lester at Colliers in Vancouver, British Columbia at (604)
661-0890 or Al Lieberman at Hilco at (847) 504-2453.

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


* Atlas Partners Scouting for $3+ Million Real Estate Deals
-----------------------------------------------------------
In conjunction with a major national real estate investor, Atlas
Partners, LLC announces a real estate financing alternative for
troubled companies' liquidity needs.

OBJECTIVE:   Atlas Partners, LLC is aggressively seeking to
              provide real estate capital for owner/user-occupied
              facilities being used for manufacturing,
              distribution, or warehousing.

PRODUCTS:    * Debt secured by real estate
              * Sale-leasebacks
              * Acquisition of surplus facilities

TARGET
MARKET:      Most primary and secondary national markets and
              many primary international markets

INVESTMENT
SIZE:        * $3 million and up per transaction
              * Single assets and portfolios

PRICING:     Highly competitive since failure of the borrower
              is not an issue

OTHER:       * Aggressive advance rates
              * Preference for "quality" real estate (e.g.,
                accessible location, efficient building
                configuration, ample clear height, expansion
                possibilities)
              * Minor regard for credit worthiness of
                owner/borrower

For more information contact:

           Biff Ruttenberg                Mike Nadler
       biff@atlaspartners.com       mike@atlaspartners.com

                         Joel Schneider
                    joel@atlaspartners.com

                      Atlas Partners, LLC
                55 E. Monroe Street, Suite 1890
                       Chicago, IL  60603
                    Telephone 312-516-5700
                    Facsimile 312-516-5710
                 http://www.atlaspartners.com


* Dewey Ballantine Appoints Seven New Partners and One Counsel
--------------------------------------------------------------
Dewey Ballantine LLP, a leading international law firm,
appointed seven new partners and one counsel to the Firm,
effective January 1, 2003. The new partners and counsel are
located in the Firm's New York, Los Angeles and London offices.

"These promotions reflect Dewey Ballantine's confidence in the
future and our ongoing commitment to providing our clients with
the highest caliber of legal services," said Everett Jassy,
chairman of Dewey Ballantine's management committee. "This
year's partner class is also a testament to our continued
success in recruiting and retaining exceptionally bright and
talented attorneys. We expect to continue that tradition both in
our eight existing offices and in our new offices recently
opened in Austin, Texas; Palo Alto, California; and Frankfurt,
Germany."

The following lawyers were elected as partners:

      Michael J. Aiello, a member of Dewey Ballantine's Mergers
and Acquisitions Group in New York, first came to the Firm in
1997. He earned his J.D., magna cum laude, in 1994 from Widener
University School of Law and is a member of the New York Bar.

      Monica M. Coakley, a member of Dewey Ballantine's Tax
Department in New York, has been with the Firm since 1996. She
earned her J.D., in 1994 from Harvard Law School and her LL.M.,
in Tax in 1995 from New York University School of Law. Ms.
Coakley is a member of the New York and New Jersey Bars.

      Jane Da Vall, a member of Dewey Ballantine's Project
Finance Group in London, came to the Firm in 1998. She earned
her B.A. (Hons), 1st Class, from Cambridge University in 1991,
and was admitted as a Solicitor in England and Wales in 1994.

      Joel I. Krasnow, a member of Dewey Ballantine's
Compensation and Benefits Group in New York, has been with the
Firm since 1989. He earned his J.D., in 1989 from Columbia Law
School and is a member of the New York Bar.

      Henry J. Ricardo, a member of Dewey Ballantine's Litigation
Department in New York, came to the Firm in 1995. He earned his
J.D. in 1993 from Columbia Law School and is a member of the New
York Bar.

      Howard M. Schickler, a member of Dewey Ballantine's
Structured Finance Group in New York, has been with the Firm
since 1992. He earned his J.D. in 1992 from New York University
School of Law and is a member of the New York Bar.

      Matthew M. Walsh, a member of Dewey Ballantine's Litigation
Department in Los Angeles, came to the Firm in 1994. He earned
his J.D., magna cum laude, in 1994 from Hastings College of the
Law where he was elected to the Order of the Coif. He is a
member of the California Bar.

The Firm has appointed Howard Mulligan of counsel to the Firm.
He is an attorney in the Structured Finance Group, based out of
the New York office. Mr. Mulligan is a 1988 graduate of Notre
Dame Law School.

Dewey Ballantine LLP, founded in 1909, is an international law
firm with more than 600 attorneys located in New York,
Washington, D.C., Los Angeles, Palo Alto, Houston, Austin,
London, Warsaw, Budapest, Prague and Frankfurt. Through its
network of offices, the firm handles some of the largest, most
complex corporate transactions and litigation in areas such as
M&A, bankruptcy, capital markets, private equity, antitrust,
intellectual property, structured finance, project finance,
international trade, and international tax. Industry
specializations include banking, healthcare, insurance, energy
and utilities, media, consumer and industrial goods, technology,
telecommunications, and transportation. For more information,
visit the firm's Web site at http://www.deweyballantine.com


* Meetings, Conferences and Seminars
------------------------------------
February 03, 2003
    EURO LEGAL
       Commercial Loan and Security Documentation
          Kingsway Hall, London UK
             Contact: +44-20-7878-6897 or
                          http://www.www.euro-legal.co.uk

February 04, 2003
    EURO LEGAL
       Successfully Documenting Syndicated Loan Transactions
          The berners Hotel, London UK
             Contact: +44-20-7878-6897 or
                          http://www.www.euro-legal.co.uk

February 20-21, 2003
    AMERICAN CONFERENCE INSTITUTE
       Commercial Loans Workouts
          Marriott East Side, New York
             Contact: 1-888-224-2480 or 1-877-927-1563
                          http://www.americanconference.com

February 22-25, 2003
    NORTON INSTITUTES ON BANKRUPTCY LAW
       Litigation Institute I
          Marriott Hotel, Park City, Utah
             Contact: 1-770-535-7722 or
                          http://www.nortoninstitutes.org

February 25-26, 2003
    EURO LEGAL
       Run-Off and Commutations
          Radisson Edwardian Hampshire Hotel, London UK
             Contact: +44-20-7878-6897 or
                          http://www.www.euro-legal.co.uk

March 6-7, 2003
    ALI-ABA
       Corporate Mergers and Acquisitions
          San Francisco
             Contact: 1-800-CLE-NEWS or http://www.ali-aba.org

March 20-21, 2003
    AMERICAN CONFERENCE INSTITUTE
       Outsourcing In Financial Services
          Marriott East Side, New York
             Contact: 1-888-224-2480 or 1-877-927-1563
                          http://www.americanconference.com

March 27-30, 2003
    NORTON INSTITUTES ON BANKRUPTCY LAW
       Litigation Institute II
          Flamingo Hilton, Las Vegas, Nevada
             Contact: 1-770-535-7722
                          or http://www.nortoninstitutes.org

March 31 - April 01, 2003
      RENAISSANCE AMERICAN MANAGEMENT, INC. & BEARD GROUP
         Healthcare Transactions: Successful Strategies for
           Mergers, Acquisitions, Divestitures and Restructurings
                 The Fairmont Hotel Chicago
                    Contact: 1-800-726-2524 or fax 903-592-5168
                             or ram@ballistic.com

April 10-11, 2003
    AMERICAN CONFERENCE INSTITUTE
       Predaotry Lending
          The Westin Grand Bohemian, Florida
             Contact: 1-888-224-2480 or 1-877-927-1563
                          http://www.americanconference.com

April 10-13, 2003
    AMERICAN BANKRUPTCY INSTITUTE
       Annual Spring Meeting
          Grand Hyatt, Washington, D.C.
             Contact: 1-703-739-0800 or http://www.abiworld.org

April 28-29, 2003
    AMERICAN CONFERENCE INSTITUTE
       Credit Derivatives
          Waldorf Astoria, New York
             Contact: 1-888-224-2480 or 1-877-927-1563
                          http://www.americanconference.com

May 1-3, 2003
    ALI-ABA
       Chapter 11 Business Organizations
          New Orleans
             Contact: 1-800-CLE-NEWS or http://www.ali-aba.org

May 8-10, 2003
    ALI-ABA
       Fundamentals of Bankruptcy Law
          Seattle
             Contact: 1-800-CLE-NEWS or http://www.ali-aba.org

June 19-20, 2003
      RENAISSANCE AMERICAN MANAGEMENT, INC. & BEARD GROUP
           Corporate Reorganizations: Successful Strategies for
               Restructuring Troubled Companies
                  The Fairmont Hotel Chicago
                     Contact: 1-800-726-2524 or fax 903-592-5168
                              or ram@ballistic.com

June 26-29, 2003
    NORTON INSTITUTES ON BANKRUPTCY LAW
       Western Mountains, Advanced Bankruptcy Law
          Jackson Lake Lodge, Jackson Hole, Wyoming
             Contact: 1-770-535-7722
                          or http://www.nortoninstitutes.org

July 10-12, 2003
    ALI-ABA
       Partnerships, LLCs, and LLPs: Uniform Acts, Taxation,
          Drafting, Securities, and Bankruptcy
             Eldorado Hotel, Santa Fe, New Mexico
                Contact: 1-800-CLE-NEWS or http://www.ali-aba.org

December 3-7, 2003
    AMERICAN BANKRUPTCY INSTITUTE
       Winter Leadership Conference
          La Quinta, La Quinta, California
             Contact: 1-703-739-0800 or http://www.abiworld.org

April 15-18, 2004
    AMERICAN BANKRUPTCY INSTITUTE
       Annual Spring Meeting
          J.W. Marriott, Washington, D.C.
             Contact: 1-703-739-0800 or http://www.abiworld.org

December 2-4, 2004
    AMERICAN BANKRUPTCY INSTITUTE
       Winter Leadership Conference
          Marriott's Camelback Inn, Scottsdale, AZ
             Contact: 1-703-739-0800 or http://www.abiworld.org

The Meetings, Conferences and Seminars column appears in the
Troubled Company Reporter each Wednesday.  Submissions via
e-mail to conferences@bankrupt.com are encouraged.

                           *********

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

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

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

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

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

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

                           *********

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

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

Copyright 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 ***