TCR_Public/030221.mbx          T R O U B L E D   C O M P A N Y   R E P O R T E R

             Friday, February 21, 2003, Vol. 7, No. 37


ALLIED DEVICES: Files for Chapter 11 Protection in E.D.N.Y.
ALLIED DEVICES: Chapter 11 Case Summary
AMES: Asks for More Time to Prepare & Deliver a Chapter 11 Plan
APPLIEDTHEORY: Exclusivity Showdown Set for Next Week
ARMSTRONG: Proposed Balloting Procedures Draw Fire

AT&T CANADA: Creditors Overwhelmingly Support CCAA Restructuring
AT&T LATIN AMERICA: Hires Greenhill and Co. as Financial Adviser
BEVERLY ENTERPRISES: 2002 Net Loss Tops $146 Million
BGF INDUSTRIES: S&P Gives Junk Rating Following Interest Delay
CADIZ, INC.: May Follow Sun World International into Chapter 11

CONSECO FINANCE: Securitization Servicing Fee Squabbles Continue
ENCOMPASS: Texas Court Limits Houlihan Lokey's Engagement Terms
ENRON: Exclusive Period Remains Intact through April 30
ENRON: Moves to Provide Indemnification to Non-Debtors' Officers
ENRON: Committee Wants to Sue Whitewing, Osprey, et al.

EOTT ENERGY: S.D. Tex. Court Confirms Chapter 11 Plan
EOTT ENERGY: Judge Schmidt Learns He Held an Interest in EOTT
FLOW INTERNATIONAL: Hires Adviser & Outlines Restructuring Plan
GENESIS HEALTH: S&P Affirms B+ Rating & Says Outlook Developing

GOLDMAN INDUSTRIAL: Judge Walrath Orders Conversion to Chapter 7
GT GROUP: Ontario Court Approves D&O Claim Procedures
HAYES LEMMERZ: Disclosure Statement Approved & Voting Begins
LINDSEY MORDEN: Dominion Places Debt Ratings Under Review
MARSH SUPERMARKETS: S&P Cuts Corp. Credit Rating a Notch to BB-

MICROCELL: Releases Information Circular to Explain CCAA Plan
NEW POWER: N.D. Ga. Court Confirms Subsidiary's Chapter 11 Plan
NORSKE SKOG: Standard & Poor's Cuts Corp. Credit Rating to BB
NRG ENERGY: Inks Deal with Executives to Dismiss Involuntary
OAKWOOD HOMES: Closes on $140 Million Revolving DIP Facility

PACIFIC GAS: For Now, Court Says, No New Plans & No More Voting
PACIFIC GAS: Standard & Poor's Provides Preliminary Debt Ratings
PALLET MANAGEMENT: Files Chapter 11 Petitions in S.D. Florida
PANACO INC.: Judge Clark Approves Continued Cash Collateral Use
PEREGRINE SYSTEMS: Balks at Committee Hiring Blackstone Group

QUANTECH LTD.: Files Chapter 7 Petition in Minnesota
QUANTECH LTD.: Chapter 7 Case Summary
SAFETY-KLEEN: ARMSTRONG: Nails Down Plan Confirmation Procedures
SERVICE MERCHANDISE: Gets $9 Million Offer for Headquarters
SIERRA PACIFIC: S&P Rates New $300 Mil. 7.25% Conv. Notes at B-

W.R. GRACE: Seeks Three-Year Extension of $250 Million DIP Loan
W.R. GRACE: Proposes 2003-2005 Key Employee Incentive Plan
WEIRTON STEEL: Says Competitiveness Boosted By New Labor Accords

* ISYS Search Software Marketed for Bankruptcy Litigation Work

*BOOK REVIEW: The Oil Business in Latin America: The Early Years


ALLIED DEVICES: Files for Chapter 11 Protection in E.D.N.Y.
Allied Devices Corporation (ALDV.OB) filed for protection from
creditors under Chapter 11 of the Bankruptcy Code as it attempts
to complete a reorganization and restructuring of its

Mark Hopkinson, Chairman of the Board, remarked, "The past 18
months, particularly since September 11, 2001, have brought a
continuous decline in sales volume so that our operating rate is
now roughly 40% of what it was two years ago. While our
customers tell us that we have not lost their business, they too
have seen drastic reductions in shipments to their customers.
Until last week, our banks had voluntarily provided forbearance
on asserting their rights and remedies, in large measure because
the Company, the banks and a third party investor had been
actively negotiating a recapitalization and restructuring plan.
While those negotiations had resolved all business issues but
one, on February 7, 2003, the investor and the banks determined
that there was no practical way of reconciling their
incompatible positions and the investor withdrew his offer.
Since then, the banks have asserted their right of offset and
applied cash in the Company's operating accounts against
balances due them.

"We have filed for protection from creditors in the belief that
we have a viable business but require some time to reorganize.
We believe we have a sufficient supply of cash to carry out a
plan that will significantly reduce overhead and take us back to
the basic elements of success for our industry: unbeatable
quality, prompt service, and competitive prices. The
restructuring will bring intense focus to our most central
competencies. While this will probably affect certain customer
relationships, we are confident that the Company will emerge as
a stronger and more agile presence in the dynamic markets where
we compete."

Allied Devices is a leading manufacturer and distributor of high
precision mechanical assemblies and components used in
industrial and commercial equipment. These products,
manufactured to exacting tolerances, provide precision motion
control in such products as factory automation, robotics,
aerospace and scientific instrumentation, semiconductor
equipment, and medical diagnostic and operating room equipment.

ALLIED DEVICES: Chapter 11 Case Summary
Debtor: Allied Devices Corporation
         dba Adco Devices Co
         dba Stroba Manufacturing Co
         dba Absolute Precision Co
         dba Astro Instruments Co
         dba Kay Pneumatics
         dba King Valve
         325 Duffy Avenue
         Hicksville, NY 11801-0000

Type of Business: Manufacturer and distributor of a broad line
                   of high precision mechanical components and
                   sub-assemblies used in industrial and
                   commercial instruments and equipment.

Bankruptcy Case No.: 03-80962

Chapter 11 Petition Date: February 19, 2003

Court: Eastern District of New York (Central Islip)

Judge: The Honorable Melanie L. Cyganowski

Debtor's Counsel: Marilyn Simon, Esq.
                   Marilyn Simon & Associates
                   280 Madison Avenue, 5th Floor
                   New York, New York 10016
                   Telephone: 212-751-7600
                   Facsimile: 212-686-1544

Estimated Assets: $24,755,243 at Sept. 30, 2002

Estimated Debts:  $26,027,440 at Sept. 30, 2002

AMES: Asks for More Time to Prepare & Deliver a Chapter 11 Plan
Ames Department Stores, Inc., asks the U.S. Bankruptcy Court for
the Southern District of New York to extend their exclusive
periods to:

    -- file a reorganization plan until August 29, 2003, and

    -- solicit acceptances of that plan through October 29, 2003.

This is the Debtors' third request for more time.  The Debtors
emphasize that the request is without prejudice to their right
to seek additional extensions, if necessary.

Martin J. Bienenstock, Esq., at Weil, Gotshal & Manges LLP,
tells Judge Gerber that the Debtors will not be able to develop
a confirmable Chapter 11 plan until the full extent of their
administrative obligations and the resources available to
satisfy the obligations are determined.  In addition to
liquidating their real estate interests, the Debtors need time
to prosecute avoidance actions to avert certain prepetition

The Debtors have suspended the payment of trade vendor
administrative expenses to preserve the estate's assets and
ensure a fair distribution to all creditors, including those
creditors holding administrative expense claims.  The Debtors
are presently reconciling the administrative expense claims.

Mr. Bienenstock further explains that a competing plan while
simultaneously engaging in the orderly liquidation of the
Debtors' assets would seriously undermine the Debtors' attempt
to maximize recoveries for all creditors, and likely subverting
their overall progress to date.  Circumstances warrant another
extension of the Debtors' Exclusive Periods, Mr. Bienenstock
asserts, because:

  (a) the Debtors' cases, with thousands of creditors and
      $1,500,000,000 in assets and liabilities, are among the
      larger and more complex Chapter 11 cases;

  (b) since the decision to wind down operations was made, the
      Debtors have worked in tandem with the Committee with
      respect to every disposition of the Debtors' assets to
      maximize recovery to creditors;

  (c) the Debtors are not seeking to use its exclusivity to
      pressure creditors into accepting a plan they find
      unacceptable.  The Debtors are in the process of
      liquidating the remaining leasehold interests, fee-owned
      property, and other assets, and reconciling administrative
      expense claims.  The Debtors' request for a further
      exclusive periods extension is not a negotiation tactic,
      but merely a reflection of the fact that the cases are not
      yet ripe for the formulation and confirmation of a viable
      Chapter 11 plan; and

  (d) the Debtors have taken many concrete steps towards
      implementing their asset disposition programs and reducing
      their operating expenses.  On December 4, 2002, the Court
      fixed procedures for the disposition of certain of the
      Debtors' fee-owned real property, unexpired leases, and
      designation rights.  The Debtors also have obtained a new
      DIP Credit facility to enable them to continue to pay
      carrying costs for their real property interests.  This
      clearly shows that the Debtors are effectively managing
      their business and preserving the value of their assets.

Judge Gerber will convene a hearing on February 25, 2003 to
consider the Debtors' request.

APPLIEDTHEORY: Exclusivity Showdown Set for Next Week
Lenders to AppliedTheory Corp. think nearly a year in bankruptcy
is long enough, there's no hope of a successful reorganization,
and the Company's chapter 11 case should be converted to a
chapter 7 liquidation.  AppliedTheory and its unsecured
creditors say nothing could be further from the truth and with
more time and continued protection under chapter 11, a
restructuring is possible.  Moreover, if liquidated, the estates
will return nothing to unsecured creditors.  The U.S. Bankruptcy
Court in Manhattan will entertain arguments on the dispute at a
hearing on Tuesday, Feb. 25.

AppliedTheory Corporation provides internet service for business
and government, including direct internet connectivity, internet
integration, web hosting and management service. The Company
filed for chapter 11 protection on April 17, 2002. Joshua Joseph
Angel, Esq., and Leonard H. Gerson, Esq., at Angel & Frankel,
P.C., represent the Debtors in their restructuring efforts. When
the Company filed for protection from its creditors, it listed
$81,866,000 in total assets and $84,128,000 in total debts.

ARMSTRONG: Proposed Balloting Procedures Draw Fire
Armstrong World Industries, Inc., and its affiliated and related
Debtors begin to lay the groundwork for confirmation of a Plan
by bring a Motion asking Judge Randall J. Newsome to:

        (1) establish procedures for the solicitation and
            tabulation of votes to accept or reject AWI's
            plan of reorganization, as amended from time to

        (2) approving the forms of ballots; and

        (3) establishing, for voting purposes only, a record
            date for the holders of claims.

                   The Proposed Voting Procedures

AWI will distribute solicitation materials with respect to its
Plan to creditors and equity security  holders asserting claims
against and holding interests in AWI, including holders of
unsecured claims, asbestos property damage claims, asbestos
personal injury claims and environmental claims, as well as
holders of equity interests in AWI.  To give as broad as
possible notice of the Plan and the Disclosure Statement, AWI
also intends to distribute Solicitation Packages to all
parties to prepetition executory contracts with AWI and to all
holders of equity interests in Armstrong Holdings, Inc., the
indirect, publicly-held parent company of AWI.

              Asbestos Personal Injury Claims

The key features of the proposed Voting Procedures for these
Claims are:

      (1)  Determination of Amount.  Asbestos Personal Injury
Claims, other than Asbestos PI Contribution Claims, were not
required to be filed by the existing Claims Bar Date.  Moreover,
because the prepetition Asbestos Personal Injury Claims were
managed by the Center for Claims Resolution, AWI does not have
the name and address of individual holders of Asbestos Personal
Injury Claims.  Accordingly, the Voting Procedures propose to
implement special procedures for publication notice of the
opportunity to vote Asbestos Personal Injury Claims, direct
notice to known attorneys for holders of Asbestos Personal
Injury Claims, and voting of Asbestos Personal Injury Claims by
attorneys to the extent the attorneys have the authority to do

      Moreover, because there has been no requirement for
Asbestos Personal Injury Claims to be filed (other than Asbestos
Contribution Claims), and individual assessments of the value of
Asbestos Personal Injury Claims can vary, the Voting Procedures
establish a fixed set of values to be used solely in connection
with determining the claim amount for voting purposes.

      (2)  The voting and valuation procedures for Asbestos
Personal Injury Claims are:

        (a)  Under the Voting Procedures, each holder of an
             Asbestos Personal Injury Claim will get a vote in a
             specified amount based upon the disease type noted
             in the ballot for each Asbestos Personal Injury
             Claim.  Each of the eight disease types will be
             assigned a different dollar amount, based upon the
             severity of the disease and consistent with the
             proposed Asbestos PI Trust Distribution.

        (b)  The Voting Procedures include special procedures for
             notification or publication of notice of the hearing
             on confirmation of the Plan and the claimant's
             ability to obtain a solicitation package, as well as
             distribution of the solicitation packages, including
             ballots, with respect to Asbestos Personal Injury

        (c)  Asbestos PI Contributi8on Claims are entitled to
             vote, regardless of the amount in which they are
             asserted, will each be assigned a value of $100 for
             voting purposes.  This approach, which will not be
             binding on a claimant or the Asbestos PI Trust for
             other purposes, will eliminate the need to make any
             individual determination (whether by estimation or
             otherwise) regarding Asbestos Personal Injury
             Claims.  Given that Asbestos Personal Injury Claims
             are in a Class by themselves under the Plan, holders
             of Asbestos Personal Injury Claims will not be
             Prejudiced by such treatment.

        (d)  The Voting Procedures also include special
             procedures for publication notice of the
             confirmation hearing and the ability to obtain a
             solicitation package, as well as the distribution of
             solicitation packages, including ballots, with
             respect to Asbestos Personal Injury Claims.  To all
             persons or entities who may hold or assert these
             claims, AWI proposes to send to their attorneys, as
             reflected in information furnished to AWI by the
             Center for Claims Resolution, a single solicitation
             package on behalf of all of the claimants
             represented by that attorney.

             The attorney will be required to certify that she or
             he is authorized to vote on behalf of each holder of
             an Asbestos Personal Injury Claim as to whom he or
             she casts a vote.  Each of the attorneys will be
             provided a master ballot to record the votes of the
             claimants on whose behalf the attorney may vote.
             Each attorney will prepare a summary sheet for
             to the master ballot listing each individual holder
             of an Asbestos Personal Injury Claim by name, social
             security number and disease category.  In the event
             that not all claimants represented by such attorney
             vote in the same manner, the summary sheet will also
             indicate whether each claimant votes to accept or
             reject the Plan.

             Otherwise, the attorney is required to send to the
             Voting Agent within 10 business days after the
             mailing of the solicitation package a list of names
             and addresses of claimants on whose behalf the
             attorney is not entitled to vote, in which case
             individual solicitation packages will be sent to
             those claimants.  Further, if an individual holder
             of an Asbestos Personal Injury Claim requests a
             solicitation package, a proof of an Asbestos
             Personal Injury Claim has been signed and filed by
             an individual before the Voting Record Date, or
             an attorney has timely advised the Voting Agent of
             the names and addresses of individuals who should
             receive their own solicitation packages, the Voting
             Agent will cause a solicitation package to be
             mailed directly to such individuals.

                   Asbestos Property Damage Claims

Asbestos Property Damage Claims have been filed with widely
varying amounts claimed, generally with no information to
support the claims.  AWI does not want to delay the solicitation
process while the individual merits of Asbestos Property Damage
Claims are assessed, so proposes these special procedures for
these claims:

    (1) Asbestos Property Damage Claims are in a class by
        themselves under the Plan, and the Voting Procedures
        provide that each claim will be given a $100 vote for
        each proof of claim that was filed in accordance with
        the Asbestos Property Damage Bar Date and is otherwise
        entitled to vote.  Therefore, each holder of an
        Asbestos Property Damage Claim that timely filed a
        Proof of claim that has not been withdrawn, expunged
        or disallowed by the Voting Record Date will be sent
        a solicitation package, and if no objection to the
        claim is pending as of the Voting Record Date, a

    (2) Each holder of an Asbestos Property Damage Contribution
        Claim that has timely filed a proof of claim that has not
        been withdrawn, expunged or disallowed, and that is not
        the subject of a pending objection by the Voting Record
        Date will receive one vote in the amount of $100.00.

                         Debt Securities

AWI has several issues of debt securities that are either fully
registered, or registered as to principal only, and which are
outstanding.  Many of these debt securities are not held
directly by the beneficial owners, but are instead held in
"street name" by various debt nominees.  Therefore, the Voting
Procedures contain customary procedures for the distribution of
solicitation packages to debt nominees and provide for either
the "prevalidation" of individual ballots, or the compilation of
master ballots by the debt nominees.  "Prevalidated" ballots
shall be returned directly to the Special Voting Agent.  If
prevalidated ballots are not used, individual ballots shall
be summarized on a master ballot and then returned.

                          Equity Interests

A solicitation package, including a ballot, will be delivered to
Armstrong Worldwide, Inc., the sole holder of record of equity
interests in AWI.  The Special Voting Agent will also cause a
solicitation package to be served upon each registered holder of
record, as of the Voting Record Date, of any of Holdings equity

                         The Voting Agents

AWI will be using two agents to distribute solicitation packages
and tabulate votes on the Plan.  Trumbull Services, LLC, is the
entity responsible for the distribution of solicitation packages
to, and tabulation of ballots received from, all entities other
than the holders of debt securities and Holdings equity

Innisfree M&A Incorporated, as Special Voting Agent, will be
responsible for the distribution of solicitation packages and
the tabulation of ballots received from the holders of debt
securities.  In addition, the Special Voting Agent will field
all inquiries on the Plan, the Disclosure Statement, and the
Voting Procedures.  The Special Voting Agent also will be
responsible for the proxy solicitation on the plan for the
liquidation or winding up of Armstrong Holdings, Inc.,
which solicitation may occur simultaneously with the
solicitation of votes on the Plan.

             Aggregation of Multiple Unsecured Claims

For purposes of voting, classification and treatment under the
Plan, each entity, other than a holder of debt securities, that
holds or has filed more than one unsecured claim against AWI
will be treated as if the entity has only one unsecured claim.
The unsecured claims filed by each entity will be aggregated and
the total dollar amount of that entity's unsecured claims
against AWI will be the sum of the aggregated unsecured claims
for that entity.

Where a claim has been transferred, and the transfer is
effective no later than the close of business on the Voting
Record Date, the aggregation, classification and treatment will
be determined based on the identity of the original holder.

                          Pending Objections

Holders of claims which are the subject of objection that are
pending as of the Voting Record Date are not entitled to vote on
the Plan unless the Bankruptcy Court enters an order allowing
the claim, whether by disposition of the objection or temporary
allowance for voting only, by the Voting Deadline.

Any motion by a claimholder for temporary allowance must be
filed within 10 calendar days after the later of service of the
confirmation hearing notice and service of the notice of an
objection to the claim.

                      Publication Notice by AWI

In addition to the Asbestos-related notices, AWI will cause
notice of the confirmation hearing and the opportunity to obtain
a solicitation package to be published (i) twice weekly in the
weekday editions of The New York Times, The Wall Street Journal,
and USA Today; (ii) once in a series of trade publications; and
(iii) once in a list of newspapers, on a date not less than 30
days before the confirmation hearing.

                        The Debtors' Arguments

AWI argues that these procedures should be approved because
these procedures adequately recognize the complex structure of
the securities industry, enable AWI to transmit materials to the
holders of its publicly traded debt securities, and afford
beneficial holders of debt securities a fair and reasonable
chance to vote.  AWI believes, and urges Judge Newsome to agree,
that the proposed Voting Procedures provide a fair and equitable
voting process.

                  Balloting Forms and Record Date

In addition, AWI asks Judge Newsome to approve the submitted
forms for these ballots, and to set Voting Record Date.  The
record date is typically the date an order approving the
Disclosure Statement is entered.  However, in order to set a
record date, the registrars of AWI's equity securities need
advance notice of approximately two full business days to enable
those responsible for assembling ownership lists of publicly
traded debt and equity securities to compile a list of holders
as of a date certain.  Accurate lists often cannot be prepared
retroactively as to ownership on a prior date.  Moreover,
although AWI may be able to give entities advance notice of the
date of the hearing on the proposed disclosure statement, that
hearing could be continued by the Court, necessitating new
notice of a potential record date, or the order approving the
proposed Disclosure Statement might not be entered as of the
date of the hearing, rendering information obtained as of the
hearing date useless.

The Voting Agent and Special Voting Agent may contact the
issuers of any master or other ballots which appear incomplete
or defective in order to correct such defects so that the ballot
may be counted.  In the event of more than one ballot by the
same party, only the last ballot filed will be counted.

Accordingly, AWI asks that Judge Newsome set a Voting Record
Date that is two business days after entry of an order approving
the Disclosure Statement for purposes of determining creditors
entitled to vote on the Plan or, in the case of non-voting
classes, to receive the solicitation package.

                        Immediate Objections

1)  The Unofficial Committee.

The Unofficial Committee of Select Asbestos Claimants,
represented by Steven T. Davis, Esq., Edmond M. George, Esq. and
Charles J. Golden, Esq., at Obermayer Rebmann Maxwell & Hippel
LLP in Wilmington, as well as all claimants represented by the
member firms of the SAC Committee, join in objecting to this

Mr. Davis explains that the SAC is a group of law firms
specializing in the handling of claims for individuals suffering
with cancers (mesothelioma, lung and others) caused by exposure
to asbestos products. The SAC and its members actively
participate in the bankruptcy cases of numerous asbestos
companies including: Owens Corning, Pittsburgh Corning
Corporation; GAF Corporation; U.S. Gypsum; Federal Mogul Global,
Inc.; W. R. Grace & Co.; Babcock & Wilcox Co.; United States
Mineral Products Company; Harbison Walker Refractories Co.; A.P.
Green; In re AC and S, Inc.; and Kaiser Aluminum Corporation.

Under AWI's proposed Plan of Reorganization, a trust will be
established for the benefit of holders of personal injury
claims. The trustees will manage the Trust for the benefit of
beneficiaries both present and future, in accordance with the
documents establishing the Trust as well as a trust
distributions procedures document. The TDP is not attached to
AWI's Disclosure Statement, although a general description of
its terms is presented.

                 Fictional Trust Distribution Procedure

It is difficult, to say the least for the SAC to fully comment
on AWI's voting procedures when they reference and incorporate a
TDP that is fictional.  Assuming the TDP in this case will be
substantially similar to that under consideration as part of
Owens Corning, Babcock & Wilcox and Pittsburgh Corning's Plans
of Reorganization, the TDP will require the claimant to produce
evidence of general exposure to asbestos containing products and
specific exposure to AWI products. It also will require proof of
diagnosis and, in most cases, objective proof of impairment
through pulmonary function testing and x-rays. After receiving
the claim, the Trust will evaluate whether or not the claimant
has adequately satisfied the criteria for the disease category
alleged. If the claimant has met her or his burden of proof, the
Trust will offer the claimant the scheduled value set forth in
the matrix contained within the TDP for the corresponding
disease category. If the claimant believes that extenuating
circumstances exist with regard to his or her claim, the
claimant may request individual review of the claim. During the
individual review process, the Trust may offer the claimant a
greater or lesser sum than the scheduled matrix value depending
on a myriad extenuating factors. However, the Trust may not
offer the claimant an amount greater than a maximum scheduled
value as contained in the TDP matrix unless the claimant falls
into an extraordinary claim category.  Extraordinary claims are
generally those claims which involving employees of AWI or those
with proof that 75% of their exposure was to an AWI product.

The qualification of a claimant for payment under the TDP is
neither automatic nor objective.  While the TDP attempts to set
forth, in as much detail as possible, the necessary criteria any
claimant must supply in order to qualify for payment, the
approval of claims is a subjective process. For example, in all
disease categories the claimant must supply the requisite
evidence of exposure to a specific asbestos-containing product
manufactured or distributed by AWI. Credible evidence of
exposure to an AWI product may include invoices, construction or
similar records, work histories identifying sites which
contained AWI products and specific exposure information. As for
medical diagnosis, at a minimum, the claimant must produce a
diagnosis by a physician, after a physical exam, certifying that
the claimant's exposure to asbestos was a substantial
contributing factor to his disease.  Medical x-rays, pulmonary
function testing and other objective medical proof of diagnosis
are also required to satisfy most disease categories.

            Attorney Decides Exposure -- Not Medical Standard

AWI's voting procedures allow the claimant's attorney to decide
if the claimant has exposure to an AWI product sufficient to
meet the AWI TDP standards for exposure. The proposed procedures
then allow the attorney to unilaterally determine into which
disease category, under the TDP, the claimant falls. It can be
assumed that counsel for the claimants will liberally construe
both of these standards in favor of their clients and tens of
thousands of claimants are likely to submit votes with no proof
of exposure to AWI products or proof of the disease claimed.

Traditionally, large groups of claimants filing against other
asbestos defendants have not complied with either the exposure
or medical criteria set forth in the AWI TDP. The importance of
the medical criteria set forth in the TDP cannot be understated.
As this Court is no doubt aware, asbestosis is a restrictive
disease of the lung's interstitial lining. However, it is by no
means the only restrictive disease of the lung. The American
Thoracic Society identifies over 150 separate diseases which
cause a restriction of lung function. Thus a diagnosis of lung
restriction, even if the presence of markings or minimum
scarring, is simply not enough to verify that asbestosis is
present or substantial cause of the patient's impairment.  There
are as many as 150 causes of fibrosis, only one of which is
asbestos. In addition, it appears that many of these 150 causes
of fibrosis are indistinguishable from asbestosis on an x-ray.
One study has shown that, among members of the general
population in an urban area, 16% (32 out of 200) are found to
have small irregular opacities-the litigation screening doctors
are reporting . . . despite the fact that none of them had
exposure to asbestos.

While it is unlikely that a claimant's diagnosis will ever rise
to the level of medical certainty, something more than a
possibility should be required. Yet based on the AWI's balloting
process, the claimant's attorney makes the determination if the
claimant was exposed to an AWI product in significant quantity
in order to establish a claim.

                    Thousands of Claimants May Vote

Based on the SAC's experience in other pending bankruptcy cases,
a vast number of claims filed against AWI will fail to:

        (1) identify exposure to a product of AWI;
        (2) establish an asbestos related disease; or
        (3) hold any proof of physical impairment necessary to
            qualify for a specific disease category.

The SAC believes that under AWI's voting proposal, many of the
claimants casting votes on AWI's proposed Plan of
Reorganization, will not hold claims against AWI.

Because AWI will receive, in all likelihood, hundreds of
thousands of claims, the parties may argue that the claims are
too numerous to examine individually or liquidate. While the SAC
does not disagree with this position, it is clear to the SAC
that ten thousands of claims may vote in this case and yet most
will have no legitimate claim against AWI. Under AWI's voting
procedures proposal, if the claimant believes the claim could be
brought against AWI the vote will be allowed.

Without any independent scrutiny, many claimants who have no
legitimate claim against AWI, will control the outcome of AWI's
case unless preliminary documentation substantiating the claim
against AWI is supplied.

                   Minimal Proof of Exposure Needed

The inexplicable and disturbing filings occurring against most,
if not all, the defendants and debtors involved in asbestos
litigation, make it imperative upon the Court protect those with
legitimate claims from the possibility that tens of thousands of
illegitimate claims will corrupt the process. Rather than allow
the perfunctory voting ballot proposed by AWI, the SAC requests
that all those submitting a vote be required to attach a proof
of a claim supplying minimal proof of their alleged disease and
exposure to an AWI product.

                    Avoiding Ballot Box Stuffing

Though this is an unusual request, the SAC believes it
absolutely necessary if rampant vote box stuffing is to be
curtailed.  Given that each and every claimant against the Trust
created under the AWI plan will have to supply proof of disease
and exposure to an AWI product, the SAC believes it appropriate
for the balloting process to require some minimal proof for
voting as well. The SAC does not believe that this proof need be
as detailed as that ultimately submitted to the Trust. However,
certain basic information such as, proof of medical diagnosis by
a physician after a physical examination should be supplied. The
diagnosis should also certify that exposure to asbestos was a
substantial contributing factor to accrual of the claimant's
disease. Further to the extent that the claimant seeks to cast a
vote at disease levels requiring pulmonary function testing
criteria and/or ILO readings, this information should be
supplied in order to establish the claimant's prima facie right
to a higher dollar value for voting purposes.  With regard to
exposure to AWI products, minimum proof in the form of
affidavit, or other documentary evidence, identifying AWI
products, should be supplied.

Though the SAC acknowledges that this request is extraordinary,
it believes this relief is absolutely necessary to protect the
integrity of the voting process. Had a bar date been assigned in
this case, the relief sought might be unnecessary. The absence
of proofs of claim allows claimants to vote without submitting
any proof of their right to do so.

It is anticipated that AWI and other parties will object to any
procedure requiring the claimants to supply even minimal medical
or exposure information by alleging that such a process would be
"too cumbersome and time consuming." Given the inexplicable
levels of claim filings and the lack of data (medical or
otherwise) available to support claims, this position is
unreasonable. For those claimants who fail to identify exposure,
in any form, to AWI's products; fail to supply proof of medical
diagnosis by a physician; or fail to demonstrate the requisite
loss of pulmonary function, denial of the right of vote in AWI's
reorganizational process is warranted.

Though the ACC has uniformly objected to any process which
requires claimants to file a proof of claim form, the SAC
believes it reasonable to require some bare level of proof
establishing exposure, disease and damage in order to vote in
AWI's confirmation process. The SAC submits that Federal Rule of
Procedure 11 would require nothing less.

              Problems With Master Ballots

Finally, the SAC expresses concern with regard to AWI's proposed
solicitation process and the use of master balloting.
Specifically, AWI has proposed a distribution of solicitation
materials to a "broad range of creditors and equity security
holders asserting claims against and holding interest in AWI."
AWI has proposed that its solicitation include a publication
notice as well as direct notice to known attorneys for holders
of asbestos personal injury claims. Its solicitation relies
heavily on the attorney's communication with the clients,
utilization of master ballots for voting, and avoids direct
solicitation of the individual clients themselves. It also
allows the attorneys to vote on the plan as the agent for the
claimant, provided the claimant has granted the attorney
authority to do so.

Generally, attorneys do not possess the right to settle cases
without specific authorization from their clients. Since AWI's
TDP is likely to contain many provisions regarding proof of
medical disease and exposure as well as limit the amount any
claimant may receive on account of his or her claim, the plan
will have substantive repercussions on the claimant's recovery.
At a minimum, the TDP and Plan will set the outer limits for
recovery. The SAC contends that as such, the client must
specifically authorize the acceptance of the plan in order for
the attorney to cast a ballot in its favor. A general power of
attorney is simply insufficient as, like a settlement, the plan
will directly impact the amount of a claim and become res
judicata as to the claimant.

AWI's proposal to allow master balloting filed on behalf of
attorneys representing large groups of claimants does not
satisfy the requirements of solicitation contained in the
Bankruptcy Code, which prohibits the solicitation of votes on a
plan of reorganization, post-petition, unless accompanied by an
approved disclosure statement.

Further, since the attorneys are not required to submit a copy
of the power of attorney along with the master ballot, there is
no way for AWI to determine, if in fact, the attorney is
properly voting the claim.

As an alternative or in addition to certification, the SAC
requests that copies of the power of attorney or other
documentation authorizing the agent's right to vote be attached
to the ballot.

2)  Official Committee of Property Damage Claimants

The Official Committee of Asbestos Related Property Damage
Claimants, represented by Joanne B. Wills, Esq., at Klehr,
Harrison, Harvey, Branzburg & Ellers LLP, joins the Unofficial
Committee in objecting strenuously to this Motion.  Ms. Wills
reminds Judge Newsome that the District Court has not yet made
any ruling on the Committee's appeal of his Daubert ruling, and
says that the balloting procedures described in the Debtors'
Motion unfairly disenfranchise holders of PD Claims and
should not be approved.

              No Rule 3018 Motions or Estimation Motions
                  While the Daubert Appeal is Pending

Based on the Court's Daubert Ruling, PD Claimants are precluded
from offering evidence derived from ASTM 5755 dust sampling to
prove the validity of their claims. Until the Daubert Appeal is
determined, this critical threshold issue will remain
unresolved.  Without a final determination of the admissibility
of dust sampling test results and data derived therefrom to
determine claim validity and to liquidate the PD Claims, neither
temporary allowance motions or estimations motions for voting
purposes or otherwise is appropriate.

Moving forward with any type of estimation process without a
final determination on the Daubert Ruling moots the PD Claimants
appeal rights, which, when coupled with the carefully crafted
solicitation procedures that are geared to disenfranchise PD
Claimants as a class, the whole process as it relates to PD
Claimants becomes a farce.

              No Hearing Schedule and Short Deadline

Once a PD Claim holder files its Rule 3018(a) motion, the only
operative date set by the Balloting Procedures is the Voting
Deadline.  Holders of PD Claims that are subject to a claim
objection are not entitled to vote unless an order allowing
their claims for voting purposes is entered prior to the Voting
Deadline. There is no provision for a schedule that would permit
PD Claimants to seek to have their claims allowed for voting
purposes.  The Balloting Procedures must specify a complete
schedule for Rule 3018 motions, including objection deadlines,
discovery deadlines, if applicable, and hearing dates.

In order to vote, a creditor subject to a timely claim objection
must file a motion for temporary allowance under Bankruptcy Rule
3018(a) within 10 calendar days of the later of (i) service of
the Confirmation Hearing Notice and (ii) service of the notice
of objection to such claim. Thus, the time to file a 3018(a)
motion in response to an objection is unfairly short. The few
remaining PD Claimants whose claims are not already subject to
the Omnibus Objection filed last year may find themselves
subject to a new objection, with only a very short time period
to bring a Bankruptcy Rule 3018(a) motion to preserve a right to

There is no colorable basis to give claim holders only 10
calendar days to prepare and to file a Bankruptcy Rule 3018(a)
motion after service of either the confirmation hearing notice
or the new claim objection.  Taking into account the delay for
mailing, and the number of intervening business days, the
deadline gives creditors only about five business days in which
to file their Rule 3018(a) motions.

To counter that, the Committee proposes that the Debtors should
be required to file all objections that would preclude a PD
Claimant from voting at least 20 days in advance of the Voting
Record Date.

                      Notice of Non-Voting Needed

The Debtors filed the Omnibus Objection on February 10, 2002.
Discovery and other proceedings on the Omnibus Objection were
stayed in March of 2002 and no further prosecution of the
objection has taken place since that time.  The pendency of the
Omnibus Objection precludes all PD Claimants holding claims
subject to the Omnibus Objection from voting, absent temporary
allowance by a 3018 motion to the Court. Since the Omnibus
Objection was filed over one year ago, and there has been no
further prosecution of the Omnibus Objection since at least
March 2002, holders of PD Claims subject to the Omnibus
Objection may not know that the Omnibus Objection is still
pending, thereby precluding their vote.

Accordingly, the Debtors should be required to either withdraw
the Omnibus Objection or, in the alternative, provide notice in
the Solicitation Materials that specifically apprises the PD
Claimants subject to the Omnibus Objection of the continuing
pendency of such objection and that such pending objection will
preclude their voting on the Plan.

                       "Plain English" Notice

The solicitation materials and procedures that apply to holders
of PD Claims omit meaningful procedural protections, notice
language and other protections that are being afforded to the
holders of PI Claims and General Unsecured Claims. The Court
should require parity for the PD Claimants and the following
procedures should apply equally to PD Claimant.  For example,
counsel for particular PI claimants are expressly permitted to
execute and submit ballots on behalf of their clients, while
counsel to PD claimants are not.

Holders of unliquidated General Unsecured Claims will receive a
special notice of the "one dollar, one vote" procedure of the
Balloting Procedures, which notice will expressly notify General
Unsecured Claimants that they must file a Rule 3018 motion to
vote in a different amount. But holders of PD Claims, even those
whose claims are liquidated, are all subject to the $100 per
claim amount for voting purposes. Yet the holders of PD Claims
are not being given the notice afforded to General Unsecured
Creditors of the right to file Rule 3018 motions so that their
vote can be afforded a different value.

The Class 6 and 7 Ballots contain detailed, plain English notice
language to assist holders of such claims to complete and timely
submit their votes so as to be counted. No such language is
included in the Class 4 Ballot proposed for holders of PD

                Tabulation Rule Unfairly Disregards
                        Liquidated PD Claims
                      and Skews the Class Vote

The Balloting Procedures provides that for voting purposes, each
and every holder of a PD Claim is deemed to hold a claim of only
$100.  This provision unfairly equalizes the holders of all PD
Claims, whether they are residential property owners with
Armstrong floor products installed in one room or large public
or commercial building owners having millions of square feet of
tile, in total disregard of the fundamental purpose of Code's
vote-counting rules.

In counting votes, claim amounts are critically important.
Accordingly, this section must be limited to unliquidated PD
Claims. If a claim is filed or scheduled in a liquidated amount,
or in a partly liquidated amount, said liquidated amount should
govern the voting amount, unless expressly ordered otherwise by
the Court.

As to unliquidated PD Claims, the Tabulation Rules should
contain language expressly preserving all rights of the
claimants to seek temporary allowance in a different amount for
voting purposes. The current language is misleading, as it
suggests that the "$100-per-claim" construct is mandatory and
approved as part of the voting procedures, precluding Rule 3018
motions by PD Claimants.

                  Need for Reports by Balloting Agent

The Balloting agent must file reports of any ballot disallowance
due to duplicate ballots, and any communications with voters;
and the agents must be prohibited from solicitation activities.
The Balloting Procedures provides that "[t]he Voting Agent or
the Special Voting Agent, in its discretion, may contact voters
to cure any defects in the Ballots or Master Ballots."

First, the procedures order should expressly prohibit any
solicitation activity by either of the Agents. The Agents are
fiduciaries of the estates, being paid by estate funds, and may
not use that position of authority to solicit acceptances for
the Plan proponents and supporters of the Plan.

Second, there should be detailed reporting of any defects cured
pursuant to the Balloting Procedures. Although the Agents should
act in a fiduciary capacity, the unfettered discretion given to
them may be used in a manner that would affect the outcome of a
class vote.  In order to police the process, the Agents must be
required to maintain detailed records of any and all contacts
with creditors. To the extent that any "defects" in ballots are
corrected, the Agents should be required to file and make
available to the Debtors and the Committees detailed reports
with the Court on a weekly basis, ending with a final
report as soon as practicable after the Balloting Deadline.

Finally, the Balloting Procedures provides that when ballots are
received from different representatives of a creditor, the last
ballot is deemed to count. The Agents should also be required to
prepare written reports detailing the circumstances with respect
to any ballots deemed superseded.

For all of these reasons, the PD Committee requests entry of an
order denying approval of the Solicitation Procedures,

AT&T CANADA: Creditors Overwhelmingly Support CCAA Restructuring
AT&T Canada Inc. disclosed that its restructuring plan was
approved by bondholders and other affected creditors at a
meeting held yesterday morning to consider and vote upon the
Plan filed by AT&T Canada on January 22, 2003.  The Plan was
approved by 91% of these bondholders and other affected
creditors that voted, representing 99% of the total value of
affected claims that were voted at the meeting.

As previously reported, the Plan will restructure the Company's
balance sheet and equity, afford a means to the best available
recovery for its bondholders and other affected creditors, and
provide AT&T Canada with the capital structure needed to support
long-term growth.

"We greatly appreciate the overwhelming endorsement of our
restructuring plan shown by our bondholders and other affected
creditors," said Purdy Crawford, Chairman of the Company's Board
of Directors. "I would especially like to acknowledge the
constructive and positive contributions made by the Restricted
Bondholder Committee and their representatives throughout this
process. I would also like to acknowledge the hard work and
support of our management team, employees, customers and
suppliers during the restructuring period. We believe the
implementation of the Plan is in the best interests of
our bondholders and other affected creditors and provides AT&T
Canada the potential to be a highly competitive leader in the
Canadian telecom marketplace."

"With the support of our bondholders and other affected
creditors, we have achieved an important milestone in our
strategy to become a strong and fully independent competitor in
the Canadian telecommunications marketplace with positive cash
flow and no long-term debt," said John McLennan, AT&T Canada's
Vice Chairman and CEO. "With today's vote in favour of the plan,
AT&T Canada is positioned to exit the CCAA process on April 1.
Going forward, we will maximize value to our customers and
provide attractive long-term growth potential for our new

On February 25, 2003, the Company will ask the Court to sanction
the Plan. Subject to Court approval, AT&T Canada expects to
emerge from CCAA proceedings on April 1, 2003.

AT&T Canada is the country's largest competitor to the incumbent
telecom companies. With over 18,700 route kilometers of local
and long haul broadband fiber optic network, world class managed
service offerings in data, Internet, voice and IT Services, AT&T
Canada provides a full range of integrated communications
products and services to help Canadian businesses communicate
locally, nationally and globally.  Please visit AT&T Canada's
web site, http://www.attcanada.comfor more information about
the Company.

AT&T LATIN AMERICA: Hires Greenhill and Co. as Financial Adviser
AT&T Latin America Corp. (OTC Bulletin Board: ATTL.OB), has
retained the firm Greenhill and Co. as its financial adviser to
evaluate strategic alternatives.  The significant cost
reductions implemented during the fourth quarter of 2002, and
highlighted in the Company's January 7, 2003 press release have
expanded the Company's restructuring options and generated
considerable market interest.  Third party inquiries are being
referred to Mike Kramer and John Liu of Greenhill.

Greenhill is a leading global investment banking firm
specializing in mergers and acquisitions and in corporate
restructuring advice.

AT&T Latin America Corp., headquartered in Washington, D.C., is
a facilities-based provider of integrated business
communications services in five countries: Argentina, Brazil,
Chile, Colombia and Peru. The company offers data, Internet,
voice, video-conferencing and e-business services.

BEVERLY ENTERPRISES: 2002 Net Loss Tops $146 Million
Beverly Enterprises, Inc. (NYSE:BEV) recorded a loss of $91
million in the fourth quarter of 2002. The loss reflects a
special pre-tax charge of $76.1 million primarily for non-cash
asset impairments and a loss of $24.7 million related to
discontinued operations.  During the comparable period in 2001,
Beverly recorded a loss of $266.6 million.  The 2001 fourth
quarter included pre-tax charges totaling $159.3 million
relating to the settlement of certain Medicare issues, asset
impairments and workforce reductions, as well as a loss of $67.5
million related to discontinued operations.

Net operating revenues for the 2002 fourth quarter totaled
$609.7 million, compared to $656.3 million in the year-earlier
period, which included results of Beverly's Florida operations
for two months. Revenues for the 2002 fourth quarter reflect a
49 basis-point increase in nursing home occupancy to 88.2
percent (the highest fourth-quarter level in four years) and a
doubling of third-party revenues for AEGIS Therapies, compared
to the 2001 period. A net reduction of 6.5 percent in Medicare
per diem rates contributed to the lower total revenues for the
2002 fourth quarter.

For the full year 2002 - and in addition to previously disclosed
items - Beverly recorded a charge of $77.2 million as the
cumulative effect of a change in accounting for goodwill,
primarily related to MATRIX Rehabilitation, which was sold on
January 24, 2003. This charge contributed to a net loss for 2002
totaling $146.1 million ($1.39 per share diluted), compared to a
net loss of $301.3 million ($2.90 per share diluted) for 2001.

"From a fundamental operating standpoint, 2002 was a challenging
but solid year," said William R. Floyd, Beverly Chairman and
Chief Executive Officer. "Nursing home occupancy averaged 87.9
percent - the highest annual level since 1998 - and Medicare
patients as a share of nursing home revenues rose to 26.3
percent, an increase of more than 400 basis points over the past
two years. AEGIS Therapies firmly established itself as a
leading provider of rehabilitation therapy services, reflecting
the strategic commitment to build the services portion of our
business. Third-party revenues for AEGIS tripled during 2002,
and it added 122 independent nursing homes as clients. Our
intense focus on cost-control throughout the organization also
produced impressive results, with an annual wage rate increase
of less than five percent - the lowest annual increase since
1998. Annual employment agency (registry) expenses were down by
more than a third to the lowest amount in three years."

Floyd continued: "It's unfortunate that these solid performance
gains were over-shadowed by the adverse effects of reductions in
Federal funding for eldercare. The failure by Congress to
restore Medicare funding to pre-October 2002 levels reduced our
fourth-quarter pre-tax income by approximately $14 million and
is expected to impact our full-year 2003 pre-tax income by a
total of $56 million. Even if no additional funding is provided,
however, we are taking the appropriate steps to ensure we retain
the financial capability to support continued improvements in
our business units, to execute our strategic growth initiatives
and to implement the plan of divesting those nursing homes that
currently account for more than half of our projected patient
care liability costs.

"Our financial resources include more than $115 million in cash
and adequate short-term borrowing capacity under our revolving
credit facility. We've reduced total debt by more than $111
million during 2002 and plan another significant reduction in
debt this year. Our commitment to improve cash flow and
strengthen the balance sheet is clearly evident within our
largest business unit, where nursing patient receivables
declined by nearly $78 million during 2002 and more than $200
million in the past two years. Days sales outstanding dropped
eight days in 2002 to 48 and have declined a total of 29 days
during the past two years."

Nursing home operating margins declined during the 2002 fourth
quarter, compared to the year-earlier period, due primarily to
reduced Medicare funding. For the full year, however, margins
increased on both actual and same-facility bases, compared to
2001. Beverly continued to strengthen its asset portfolio during
the year, divesting 19 non-strategic or under-performing nursing
homes. It added 16 programs specializing in the care of
Alzheimer's patients during the fourth quarter, bringing the
year-end total of these margin-enhancing operations to 110.

AEGIS Therapies added 122 third-party clients during 2002,
including 37 in the fourth quarter, bringing the year-end total
of non-Beverly nursing homes it serves to 385. Average revenues
per new contract increased in the fourth quarter and throughout
2002. Hospice operations continued to grow, with average daily
census approaching 800 patients at year-end, up 10 percent from
the fourth quarter of 2001. Hospice margins were up, both
sequentially and compared to the year-earlier fourth quarter.

A recently completed actuarial study of patient care liability
supports a determination that current reserves are adequate.
Although costs continue to increase, the trends are within the
parameters projected by earlier studies. Beverly's projected
costs are expected to decline as the company completes its plan
to divest nursing homes that account for a disproportionately
high share of patient care liability costs. In addition,
voluntary agreements to use arbitration to resolve patient care
issues that might otherwise lead to lawsuits were implemented in
October 2002. The arbitration option currently is being accepted
by approximately 75 percent of newly admitted patients. In
another positive development, tort reform is gaining widespread
bipartisan support at national and state levels, and legislative
remedies would slow the growth of liability costs throughout the
nursing home industry.

Floyd noted: "We believe there is growing recognition within the
Administration for the need to provide adequate funding for
Medicare and to assist the states with Medicaid. We're
encouraged by continuing strong support expressed by members of
both political parties in Congress, and believe that significant
new funds for eldercare will be authorized later this year.
We're also encouraged by the President's plan to extend the
Medicare funding associated with RUG refinements for at least
another year.

"The plans we're executing for 2003, however, are based not on
hopeful assumptions, but on the current realities of a difficult
operating environment. We therefore have taken aggressive
actions to further reduce overhead costs, obtain pricing
concessions from suppliers, improve the effectiveness of our
fundamental business processes and develop new sources of
profitable revenue. Despite the funding crisis facing our
industry, we are committed to implementing our divestiture plan
and to creating a stronger, more successful company."

                     Bank Loan Amendments

Beverly received an amendment from its bank group for covenant
relief, due to year-end special charges, and currently is in
compliance. The company also has reached an agreement with its
bank group that would provide covenant relief in the future and
allow for implementation of the divestiture plan. Beverly
remains committed to using asset sale proceeds to further de-
leverage the company.

As previously disclosed, Beverly has retained an independent
third party to audit MK Medical's billing of government payors
to determine the extent of potential overpayments. The $24.7
million net loss for discontinued operations relating to MATRIX
and MK Medical in the fourth quarter of 2002 includes a reserve
for potential overpayments from government payors that is based
on the preliminary results of the third party audit.

Beverly Enterprises, Inc. and its operating subsidiaries
comprise a leading provider of healthcare services to the
elderly in the United States. They operate 452 skilled nursing
facilities, as well as 29 assisted living centers, and 49 home
care and hospice centers. Through AEGIS Therapies, they also
offer rehabilitative services on a contract basis to nursing
homes operated by other care providers.

BGF INDUSTRIES: S&P Gives Junk Rating Following Interest Delay
Standard & Poor's Ratings Services raised its corporate credit
rating on glass fiber fabrics manufacturer BGF Industries Inc.
to 'CCC' from 'D' following the company's payment within the 30-
day grace period of interest due Jan. 15, 2003, on the company's
$100 million subordinated notes due 2009. The current outlook is

At the same time, Standard & Poor's said that it raised its
rating on the Greensboro, N.C.-based company's subordinated debt
to 'CC' from 'D'. The interest payment was financed with
proceeds from a new $10 million bridge loan, which was also used
to repay all outstanding amounts under the company's senior
credit facility, on which Standard & Poor's has withdrawn its

"The ratings reflect a financial profile that remains fragile",
said Standard & Poor's credit analyst Cynthia Werneth. "BGF
Industries has experienced prolonged weak market conditions in
electronics and aerospace end markets as well as the bankruptcy
filing of a major supplier and affiliate, Advanced Glassfiber
Yarns LLC. BGF has downsized operations, reduced operating
and capital expenditures, and engaged a crisis management
consulting firm.  Nevertheless, there is substantial doubt about
the company's ability to continue as a going concern."

CADIZ, INC.: May Follow Sun World International into Chapter 11
Cadiz Inc. had an agreement with its senior lender, ING Capital
LLC, to extend the maturity of certain senior debt, conditioned
on the company's wholly owned subsidiary, Sun World
International, Inc., renewing its revolving credit agreement.
That condition wasn't met when Sun World filed for bankruptcy.
While Cadiz has continued to negotiate with ING for an overall
restructuring of its debt, on February 13, 2003, ING delivered
to Cadiz a Notice of Default and Demand for Payment.

Cadiz says it is currently in discussions with several parties
to obtain this funding.  If Cadiz is unable to obtain such
funding and complete a restructuring of the ING debt on an out-
of-court basis shortly, Cadiz "may be required to consider
alternatives that may be achievable on an in-court basis."

CONSECO FINANCE: Securitization Servicing Fee Squabbles Continue
Conseco Inc.'s Conseco Finance Corp. unit filed an Emergency
Motion to reject the servicing agreements for its $23 billion
manufactured housing loan portfolio and then, at the 11th hour,
withdrew the request.  Conseco Finance said in court documents
that bickering over the mobile-home loan portfolios among the
holders of securitization certificates in 68 separate trusts are
jeopardizing the unit's stability and threatening the sale of
the business.

As previously reported, an interim order authorized an increase
in the servicing fees from 0.5% to 1.25% through March 5, 2003.
That increase irks the noteholders because those additional fees
diminish the value of their collateral and ultimate recovery.

ENCOMPASS: Texas Court Limits Houlihan Lokey's Engagement Terms
Judge Greendyke authorizes Encompass Services Corporation to
employ Houlihan Lokey as its financial advisors and investment
bankers, subject to these terms:

  (a) Houlihan Lokey will not be entitled to indemnification,
      contribution or reimbursement pursuant to the November 19,
      2002 letter agreement between the Debtors and Houlihan
      Lokey for services other than the financial advisory and
      investment banking services required under the Letter
      Agreement, unless the Court approves other services and
      the indemnification, contribution or reimbursement;

  (b) The Debtors will have no obligation to indemnify Houlihan
      Lokey, or provide contribution or reimbursement to
      Houlihan Lokey, for any claim or expense that is either:

        (i) judicially determined to have arisen solely from
            Houlihan Lokey's gross negligence, willful
            misconduct, breach of fiduciary duty, if any, bad
            faith or self-dealing; or

       (ii) settled before a judicial determination as to
            Houlihan Lokey's gross negligence, willful
            misconduct, breach of fiduciary duty, or bad faith
            or self-dealing but determined by the Court, to be a
            claim or expense for which Houlihan Lokey should not
            receive indemnity, contribution or reimbursement;

  (c) If, before the earlier of (i) the entry of a final order
      confirming a Chapter 11 plan in the Debtors' bankruptcy
      cases; and (ii) the entry of an order closing these
      Chapter 11 cases, Houlihan Lokey believes that it is
      entitled to the payment on account of the Debtors'
      indemnification, contribution and reimbursement
      obligations under the Agreement, including the advancement
      of defense costs, then Houlihan Lokey must file an
      application with the Court and the Debtors may not pay any
      amount to Houlihan Lokey before the entry of a Court order
      approving the payment.  The U.S. Trustee and the Official
      Committee of Unsecured Creditors will retain the right to
      object, at any time and on any ground, to any demand by
      Houlihan Lokey for indemnification contribution or
      reimbursement; and

  (d) The limitation on any amount to be contributed by all
      indemnified parties in the aggregate will be eliminated.

Judge Greendyke further rules that Houlihan Lokey's M&A
Transaction Fee must not exceed 10% of the cash the Debtors
received in an M&A Transaction including any escrowed cash.

Judge Greendyke also precludes the firm's affiliates, Sunrise
Capital Partners, L.P. and Century Park Capital, L.P., from
investing in the Debtors during the pendency of these cases.

ENRON: Exclusive Period Remains Intact through April 30
The Honorable Arthur J. Gonzalez ruled yesterday that Enron
Corp. and certain of its subsidiaries are entitled to an
extension of their exclusive period to file a chapter 11 plan
and solicit acceptances of that plan from the company's

Judge Gonzalez orders that, pursuant to 11 U.S.C. Sec. 1121(d),
Enron's Exclusive Filing Period in which the Debtors -- and only
the debtors -- may file a chapter 11 plan is extended to and
including April 30, 2003.  The Debtors are awarded a concomitant
extension of the Solicitation Period in which to solicit
acceptance of a chapter 11 plan is to and including June 30,
2003.  Judge Gonzalez makes it clear that these extensions are
without prejudice to further requests for extensions by the
Debtors or any other party in interest.

If, however, Harrison J. Goldin, the Court-Appointed Examiner in
the Enron North America Corp. Bankruptcy Proceeding, should
determine prior to April 30 that the process and approach the
Debtors are pursuing for the formulation of a joint and
consensual chapter 11 plan are not working, he is authorized to
request, at any time prior to April 30, a status conference with
the Court to report on developments and recommendations.

Additionally, if the Debtors do not file a plan of
reorganization by April 30, and the Debtors, including ENA, seek
additional extensions of their Filing and Solicitation Periods,
the ENA Examiner, as plan facilitator for ENA, shall file
a status report within ten days prior to any scheduled hearing
in connection with the Debtors' request for a further extension
of exclusivity to report detailing:

       (1) the developments in the formulation of a joint chapter
           11 plan;

       (2) the appropriateness of any further extension of
           exclusivity for ENA; and

       (3) the appropriateness of a formulation at that time of a
           separate chapter 11 plan for ENA.

ENRON: Moves to Provide Indemnification to Non-Debtors' Officers
"A pervasive need in [Enron's] Chapter 11 cases has been
retention of key employees in the face of significant employee
attrition," Martin Bienenstock, Esq., at Weil, Gotshal & Manges
LLP, in New York, says.  Recognizing that the value of Enron's
businesses cannot be preserved and maximized for creditors'
benefit without the employees critical to the operation of those
businesses and retention of these employees cannot be
accomplished without providing a financial incentive for
continued employment, and to assure their employees that they
will be rewarded for dedicated service towards the
reorganization effort, the Debtors began their retention

Subsequently, on May 8, 2002, the Court approved certain
indemnification provisions to current officers and directors on
an administrative expense basis.  However, Mr. Bienenstock
relates that concerns have been raised recently by officers and
directors of the Debtors' various non-debtor subsidiaries with
respect to whether they indeed are covered by the May 8 Order.
Arguably, the May 8 Order is unclear on this point.

Accordingly, the Debtors seek the Court's authority to continue
the indemnification of non-debtors' officers and directors for
claims arising out of postpetition service pursuant to Section
363 of the Bankruptcy Code.  The Debtors also want the Court to
confirm that the indemnification claims have administrative
expense priority pursuant to Sections 503(b) and 507 of the
Bankruptcy Code.

Mr. Bienenstock contends that the request is warranted because:

    (a) it was contemplated that officers and directors of
        non-debtor subsidiaries also have the indemnification
        rights they enjoyed under Enron's Articles of
        Incorporation and in the May 8 Order;

    (b) the indemnification of directors and officers of
        non-debtor subsidiaries for acts arising out of
        postpetition service is authorized under Section 363(c)
        as an ordinary course transaction;

    (c) without the indemnification, the status of the Debtors'
        enterprises as going concerns is questionable since the
        Debtors' reorganization efforts depend on the collective
        cooperation of each of the Debtors' interconnected
        divisions and their employees -- specifically their
        officers and directors;

    (d) the myriad of investigations into the Enron Companies and
        the resulting concerns of officers and directors relating
        to the possibility of exposure to personal liability
        based on their service to the Enron Companies has created
        an acute attrition problem that threatens to intensify;

    (e) it will enable the Debtors to provide meaningful
        protection, as allowed under Oregon law and the Debtors'
        Articles of Incorporation, and to protect the directors
        and officers working to preserve the Debtors' estates.

ENRON: Committee Wants to Sue Whitewing, Osprey, et al.
Pursuant to Sections 105(a), 1103(c) and 1109(b) of the
Bankruptcy Code, the Official Committee of Unsecured Creditors
appointed in Enron's chapter 11 cases seeks permission from the
U.S. Bankruptcy Court in Manhattan to commence an adversary
proceeding on behalf of the Debtors' estates against:

    -- Whitewing Associates LP,
    -- Whitewing Management LLC,
    -- The Osprey Trust,
    -- BAM Leasing Company,
    -- Kingfisher I LLC,
    -- Egret I LLC,
    -- Peregrine I LLC,
    -- PE Holdings LLC,
    -- ES Power 2 LLC,
    -- ESP 1 Interest Owner Trust,
    -- LFT Power II LLC,
    -- LFT Owner Trust,
    -- Paulista Electrical Distribution LLC,
    -- Purple Martin LLC,
    -- ECT Colombia Pipeline Holding II Ltd.,
    -- Merlin Acquisition LP,
    -- Speckled Holdings LP,
    -- Anhinga LP,
    -- Enron Equipment and Procurement Company, and
    -- Woodlark LP.

The contemplated litigation seeks to recover more than
$1,000,000,000 for the benefit of Enron's estate and general
unsecured creditors through, inter alia, the substantive
consolidation of Whitewing and Enron, challenges based on a lack
of true sale, and avoidance actions.

Stephen D. Lerner, Esq., at Squire, Sanders & Dempsey LLP, in
Cincinnati, Ohio, contends that the Committee should be
authorized to bring claims on behalf of the Debtors' estates

    (a) Sections 1103(c)(5) and 1109(b) of the Bankruptcy Code
        provide a qualified right to creditors' committees to
        commence actions in the name of the debtor-in-possession
        with the approval of the bankruptcy court;

    (b) in light of the widespread publicity concerning Enron,
        Whitewing, Osprey and their relationships, the Committee
        has determined that the Action pleads meritorious claims
        that have the potential to be the most significant source
        of assets for the Debtors' estates in this entire
        bankruptcy proceeding;

    (c) the Committee believes that the likelihood of success on
        the merits, and the likelihood of recovering amounts into
        Enron's estates well in excess of the costs to reduce
        the Claims to judgment, justifies the expense of
        prosecuting the litigation; and

    (d) since the Complaint pleads substantive consolidation,
        true sale and preference theories, there are multiple
        bases for recovery.

EOTT ENERGY: S.D. Tex. Court Confirms Chapter 11 Plan
EOTT Energy Partners, L.P. (OTC Pink Sheets: EOTPQ) sought and
obtained confirmation of its amended Plan of Reorganization in
the U.S. Bankruptcy Court for the Southern District of Texas in
Corpus Christi.

EOTT's Plan of Reorganization is expected to become effective on
March 1, 2003, with orders signed today by the Honorable Richard
Schmidt. The Plan was approved by a substantial majority of the
creditors in each of the voting classes.  The Plan of
Reorganization also provides for a final separation from Enron
Corp. on the effective date of the Plan. However, EOTT's Plan of
Reorganization is subject to appeal for ten days following the
entry date of the Court's orders.

Commenting on the confirmation of the Plan, EOTT President Dana
R. Gibbs said, "The successful conclusion to our reorganization
has been made possible thanks to the support of our customers,
vendors, and employees. From the beginning of this
reorganization process, our goal has been to emerge swiftly,
separate completely from Enron, then restore our customers'
confidence in EOTT, and work toward achieving the level of
business activities that existed in the past. Looking ahead, we
believe that with today's confirmation of our plan, EOTT will
have a solid framework for competing in the future, with solid
customer relationships, and a stronger financial position."

EOTT filed for protection under Chapter 11 of the U.S.
Bankruptcy Code on October 8, 2002 in the United States
Bankruptcy Court for the Southern District of Texas, Corpus
Christi Division, in order to significantly reduce its debt,
restructure its finances, and formalize a complete legal
separation from Enron.

For current information on the plan of reorganization, please
see updates at

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: Judge Schmidt Learns He Held an Interest in EOTT
On January 29, 2003, Judge Schmidt learned that he individually
owns a small royalty interest in a lease operated by EOTT Energy
Operating Limited Partnership in Marion County, Texas.  In the
calendar year 2002, Judge Schmidt received net proceeds
amounting to $103 according to a Form 1099 he received
from EOTT.  Until the receipt of Form 1099, Judge Schmidt says
he was unaware that EOTT was the operator of the Lease.

Pursuant to Section 455(b)(4) of the Judiciary Procedures Code,
a judge will recuse himself if he knows that he has a financial
interest in the subject matter in controversy or in a party to
the proceeding, or any other interest that could substantially
affect the outcome of the proceeding.  However, Judge Schmidt
believes that his small royalty interest will not be
substantially affected by the outcome of the proceeding.  Judge
Schmidt does not own a legal or equitable interest in any EOTT
Debtor.  Accordingly, Judge Schmidt will not recuse himself sua
sponte.  Nevertheless, Judge Schmidt says he will divest himself
of the royalty interest as soon as possible pursuant to Section
455(f) of the Judiciary Procedures Code.

Standard & Poor's Ratings Services raised its corporate credit,
senior secured, and subordinated debt ratings on scientific and
clinical laboratory equipment distributor Fisher Scientific
International Inc. and removed the ratings from CreditWatch,
where they had been placed on Dec. 19, 2002.

At the same time, Standard & Poor's assigned its 'BB+' bank loan
rating to Fisher's $575 million bank facility, to be initially
drawn by subsidiary Fisher Scientific Company, LLC. The credit
facilities rating is one notch higher than the corporate
credit rating of 'BB', reflecting a strong likelihood of full
recovery of principal in event of default or bankruptcy.

The upgrade and CreditWatch removal reflect the financial
benefits of the company's soon-to-be completed refinancing. The
new credit facility, combined with recently-issued subordinated
debt, will fund the prepayment of $600 million of 9%
subordinated debt. These actions will reduce the company's
ongoing interest expense by at least $10 million annually and
lengthen the debt maturity schedule.

The bank credit facility is composed of a $400 million, seven-
year term loan and a $175 million, five-year revolving credit
facility, which replaces an existing revolving credit agreement.
Both are secured by Fisher's material domestic assets and the
stock of material subsidiaries.

"The speculative-grade ratings reflect Hampton, N.H.-based
Fisher's well-established position as a distributor of a wide
variety of supplies and equipment for the scientific and
clinical laboratory communities, a factor offset by the
company's highly leveraged capital structure," said Standard &
Poor's credit analyst David Lugg. Management's willingness to
use debt to achieve its value goals is evidenced by Fisher's
1998 recapitalization, which added $950 million of debt.

Fisher's broad product offering, diverse customer base,
exclusive distribution arrangements with equipment
manufacturers, and agreements with most major domestic group-
purchasing organizations are barriers to entry for new
competitors. Despite the fact that the company continues to
operate with a heavy debt burden, with total debt to capital in
excess of 95%, other credit measures are strengthening,
reflecting ongoing operating improvements.

Although Fisher is expected to extend its record of improving
cash generation, the company's interest in large cash-financed
acquisitions, evidenced by the 2001 $209 million debt-financed
purchase of Cole-Parmer, limits the potential for overall credit

FLOW INTERNATIONAL: Hires Adviser & Outlines Restructuring Plan
Flow International Corporation (Nasdaq: FLOW), the world's
leading developer and manufacturer of ultrahigh-pressure
waterjet technology used for cutting, cleaning (surface
preparation) and food safety applications, yesterday announced
the start of a two-year restructuring program intended to return
the company to profitability through reductions in headcount,
consolidation of facilities and operations, and closure or
divestiture of selected company business units. Additionally, as
part of that restructuring, FLOW has retained The Food Partners,
LLC, the nation's preeminent investment banking firm to the food
industry, to develop and implement strategic alternatives for
AVURE, the company's food technology business unit.

FLOW also announced that it has entered into a new long-term
lease for the company's headquarters facility providing
substantial savings throughout the lease term, and that the
company has obtained the debt covenant forbearance from its
Senior Lenders discussed in its December 16, 2002 Form 10-Q and
its January 27, 2003 Form 8-K announcement. The company will
begin to work with its Subordinated Lender to obtain the same
forbearance. In addition, FLOW anticipates developing a new
long-term credit facility with its Senior Lenders to replace its
current facility, which expires in September 2003.

"We are committed to restructure our company over the next two
years to restore profitability and aggressively improve cash
flows and return on investment while we continue to develop and
manufacture customer productivity enhancing equipment and
technology," commented Stephen R. Light, Flow's newly appointed
President and CEO. "Working in concert with our Senior Lenders,
we expect to complete our restructuring within the limits of our
current credit facility. We believe that inventory reduction and
receivable collection programs, as well as other expense
reductions, will allow the company to self-fund the majority of
the cash costs related to the restructuring. We are pleased that
our Senior Lenders have endorsed this program and are committed
to helping us achieve this plan."

Light continued, "We are evaluating all aspects of our business
to identify cost savings and global efficiencies. Initial
elements of the restructuring program are already underway. In
the near term, we would expect there to be closures and
divestitures or reductions in work force in selected operations,
as well as significant non-cash write offs.

"Following completion of our restructuring and new product
introduction programs, a fiscally strong, customer-focused FLOW,
will have enhanced its global leadership position in all
presently served markets including Europe, the Americas, Asia
and the Middle East.

"We will provide more detail on our restructuring program and
its financial impact, as well as provide an update on our
progress with our lenders, when we report our quarterly

The company expects to report its third fiscal quarter financial
results and hold a conference call for investors and analysts on
March 17, 2003 after the close of regular market trading.

                      About Flow International

Flow International Corporation is the world's leading developer
and manufacturer of ultrahigh-pressure (UHP) waterjet technology
for cutting, cleaning, and food-safety applications, as well as
isostatic and flexform presses. FLOW provides total system
solutions for various industries, including automotive,
aerospace, paper, job shop, surface preparation, and food
production. For more information, visit

              About Avure Technologies Incorporated

Avure Technologies is a wholly owned subsidiary of Flow
International Corporation. Avure's Fresher Under Pressure HPP
technology destroys food-borne pathogens, including Salmonella,
E. coli and Listeria. HPP also destroys other organisms that can
cause health hazards and spoilage in fresh foods, without
compromising taste, color, texture, or nutritional value. For
more information, visit

                About The Food Partners, LLC (TFP)

The Food Partners is the nation's preeminent investment banking
firm to the food industry. With nearly 120 years of collective
investment banking experience, TFP provides merger, acquisition
and divestiture services, private placements of debt and equity
capital and strategic advisory services. TFP clients represent
all segments of the food chain and include input, processing,
manufacturing, distribution and retail companies, as well as the
most prominent capital sources to the food industry. For more
information visit

GENESIS HEALTH: S&P Affirms B+ Rating & Says Outlook Developing
Standard & Poor's Ratings Services affirmed the ratings on
Genesis Health Ventures Inc. -- at BB+.  At the same time, the
ratings have been removed from CreditWatch, where they were
placed Oct. 3, 2002. The removal from CreditWatch reflects the
company's announcement that its board has approved a plan that
splits Genesis into two public companies.

Genesis will retain its institutional pharmacy business, called
NeighborCare, and will spin off its eldercare businesses into a
new firm. The transaction is expected to be completed by the end
of the year.

The outlook on the Kennett Square, Pa.-based Genesis is
developing. Total debt outstanding as of Dec. 31, 2002, was $647

"The rating currently reflects the company's existing business
profile," said Standard & Poor's credit analyst David Peknay.
"About half of Genesis' revenues derived from its eldercare
business and half from NeighborCare. The eldercare division has
experienced significant challenges as a result of several
industry-related concerns such as government reimbursement and
the highly litigious environment."

Genesis' credit profile after completion of the spin-off is
uncertain.  Existing debt will be refinanced, but the capital
structure will not be determined for several months. Moreover,
operating prospects are clouded.

It is expected that these issues, as well as the company's
future strategic focus, will become clearer sometime this
summer, and Standard & Poor's will review the credit prospects
for the company at that time.

GOLDMAN INDUSTRIAL: Judge Walrath Orders Conversion to Chapter 7
The Honorable Mary F. Walrath in the U.S. Bankruptcy Court for
the District of Delaware ordered this week that the chapter 11
restructuring stated by Goldman Industrial Group Inc. will end
in a chapter 7 liquidation.  Goldman was unable to secure
continued working capital financing and threw in the towel.  The
United States Trustee for Region III will appoint a chapter 7
panel trustee to liquidate Goldman Industrial's estate and wind-
up its business affairs.

Goldman Industrial Group, Inc., with its affiliates, provided
metalworking machinery to manufacturers; marketing and selling
original equipment primarily to the aerospace, automotive,
computer, defense, medical, farm, construction, energy,
transportation and appliance industries. The Company filed for
bankruptcy on February 14, 2002 (Bankr. Del. Case No. 02-10467).
Victoria W. Counihan, Esq., at Greenberg Traurig, LLP represents
the Debtors.

GT GROUP: Ontario Court Approves D&O Claim Procedures
On February 14, 2003, the Superior Court of Justice authorized
the implementation of a procedure for the submission, evaluation
and adjudication of certain specific possible claims against
Directors and Officers of GT Group Telecom Inc.

The D&O Claims Procedure pertains only to specific possible
claims against Directors and Officers of GT Group Telecom Inc.

The D&O Claims Procedure does not apply to claims, of any type,
as against GT Group Telecom Services Corp., GT Group Telecom
Services (USA) Corp. and LondonConnect Inc., or against the
Directors and Officers of these three entities.

Claims as against GT Group Telecom Services Corp., GT Group
Telecom Services (USA) Corp. and LondonConnect Inc. and their
Directors and Officers have been dealt with under the Plan of
Arrangement filed by these three entities and sanctioned by
Order of the Superior Court of Justice on December 23, 2002,
which Order was subsequently recognized in the United States on
January 2, 2003 by Order of the United States Bankruptcy Court
pursuant to Section 304 of the Bankruptcy Code. Creditors of GT
Group Telecom Services Corp., GT Group Telecom Services (USA)
and LondonConnect Inc. do not have to file claims in the D&O
Claims Procedure.

The specific possible claims against Directors and Officers of
GT Group Telecom Inc. have been defined in the Order as "D&O
Claims". "D&O Claims" means all costs, claims, liabilities and
obligations which any Director or Officer sustains or incurs
(including, without limitation, legal costs on a solicitor and
client basis) in his or her capacity as a Director or Officer of
GT Group Telecom Inc. relating to the failure of GT Group
Telecom Inc., GT Group Telecom Services Corp., GT Group Telecom
Services (USA) Corp. and LondonConnect Inc., or any of them, at
any time, to make any payments in respect of which the Director
or Officer may be liable under any law in his or her capacity as
a director or officer of GT Group Telecom Inc. in respect of
certain statutory claims and deemed trusts, or with respect to
wages and other amounts owing to employees, except to the extent
that the Director or Officer has actively participated in the
breach of any related fiduciary duty or has been grossly
negligent or guilty of willful misconduct.

Further details of the specific possible claims are set out in
Paragraphs 23(a) and 24 of the Initial CCAA Order, a copy of
which can be found at

The Court has ordered that any party (a "Claimant") wishing to
assert a D&O Claim shall deliver to PricewaterhouseCoopers Inc.
(the "Monitor") a Claim Notice on or before March 28, 2003.
Copies of the Claim Notice form are available below, or may be
obtained from the Monitor by faxing a written request to
(416) 814-3219, attention: Ms. Louisa Blunda.

The Court has also ordered that the D&O Claims of all Claimants
who do not deliver to the Monitor a Claim Notice on or before
March 28, 2003 shall be forever extinguished and barred from and
after March 28, 2003 and all Claimants shall be deemed to have
fully and finally released all D&O Claims.

Claimants who wish to obtain further information should contact
PricewaterhouseCoopers Inc., the court-appointed Monitor of GT
Group Telecom Inc.  (Attention: Ms. Tracey Weaver - telephone
416 814 5735 or fax 416 814 3210).

HAYES LEMMERZ: Disclosure Statement Approved & Voting Begins
Hayes Lemmerz International, Inc. (OTC: HLMMQ) obtained approval
of its amended Disclosure Statement relating to its Plan of
Reorganization from the U.S. Bankruptcy Court for the District
of Delaware.  The Company's voluntary Chapter 11 reorganization
is on schedule, the Company says.

The amended Disclosure Statement and Plan that were presented to
the Bankruptcy Court at a hearing yesterday to memorialize the
Company's agreement regarding the terms of the Plan with its key
creditor constituencies including the agent for the prepetition
lending group, the largest holder of the Company's senior notes
and the Official Committee of Unsecured Creditors.  The amended
Disclosure Statement and Plan have the full support of these

The Plan is subject to, among other things, a vote of the
various classes of constituents, confirmation by the Bankruptcy
Court and the successful procurement of exit financing.  The
Company intends to solicit votes for its Plan during much of the
month of March.  On the exit financing front, the Company has
already received several exit financing proposals and is working
closely with the potential lenders to ensure that the financing
is in place in time to allow the Company to emerge from Chapter
11 during the first half of 2003.

"We are delighted to commence 2003 with such a positive step
towards our emergence," said Curtis J. Clawson, Chairman and
Chief Executive Officer of Hayes Lemmerz.  "Obtaining approval
of our Disclosure Statement is a key step forward for Hayes
Lemmerz.  It is the culmination of months of negotiations
with our creditor groups.  Although we must await the outcome of
the vote and the Court's decision at the confirmation hearing,
we are optimistic that Hayes Lemmerz is on track to emerge from
Chapter 11 in the first half of 2003."

"Our customers, employees and suppliers have been supportive of
our reorganization efforts, and we're moving forward with many
new initiatives that will further strengthen Hayes Lemmerz,"
said Mr. Clawson.

The amended Disclosure Statement and POR can be obtained from
Hayes Lemmerz' website at

Hayes Lemmerz and its subsidiaries located in the United States
and one subsidiary in Mexico filed voluntary petitions for
reorganization under Chapter 11 of the bankruptcy code in
the U.S. Bankruptcy Court for the District of Delaware on
December 5, 2001.

Hayes Lemmerz International, Inc. is one of the world's leading
global suppliers of automotive and commercial highway wheels,
brakes, powertrain, suspension, structural and other lightweight
components.  The Company has 44 plants, 3 joint venture
facilities and 11,400 employees worldwide.

LINDSEY MORDEN: Dominion Places Debt Ratings Under Review
Following the recently announced year-end financial results,
Dominion Bond Rating Service Ltd is placing the long-term rating
of Lindsey Morden Group Inc. "Under Review with Negative
Implications," as a result of continuing weak markets, a
decrease in cash flow, and no improvement in the Company's high
debt levels. The rating action is based on the following

     (1) The fourth quarter is seasonally strong for Lindsey, and
the continuing below-average results do not support the
improvement that DBRS had expected. Free cash flow declined in
2002 to $17.4 million, from $20.6 million reported in the prior

     (2) The Company had established a debt/capitalization target
in the range of 40% to 45%, but leverage was higher as at Q3
2002 at about 56%.

     (3) DBRS has historically considered support from the
parent, Fairfax Financial Holdings Limited ("Fairfax"), as
a positive rating consideration, but Fairfax's rating and
financial flexibility have fallen over time, such that this
factor can no longer be given a high weighting.

More positively, Lindsey has taken steps to refocus operations
in the U.S., including re-pricing initiatives and implementing
cost reduction strategies. Further, past restructuring efforts
in Canada and other areas have led to improved operating
earnings in most divisions in 2002, and settlement of various
litigation issues is also favourable. DBRS will discuss full
details of the 2002 year-end results with Lindsey management
and make a rating determination at that time.

DBRS is a Toronto-based, full-service credit rating agency
established in 1976. Privately owned and operated without
affiliation to any organization, DBRS is respected for its
independent, third-party evaluations of corporate and government
issues, spanning North America, Europe and Asia. DBRS's
extensive coverage of securitizations and structured finance
transactions solidifies our standing as a leading provider of
comprehensive, in-depth credit analysis.

MARSH SUPERMARKETS: S&P Cuts Corp. Credit Rating a Notch to BB-
Standard & Poor's Ratings Services lowered its corporate credit
rating on Indianapolis, Ind.-based Marsh Supermarkets Inc. to
'BB-' from 'BB' based on weak sales trends and declining EBITDA
in recent quarters.

The outlook is negative. Approximately $206 million of debt is
affected by this action.

"The weak sales trends and declining EBITDA resulted from
competitive store openings in Marsh's market, and a highly
promotional sales environment and more selective consumer
spending patterns due to the weakened U.S. economy," Standard &
Poor's credit analyst Patrick Jeffrey said.

"The company's same-store sales trends were negative for the
past three quarters, which has negatively impacted credit
protection measures. A downgrade could be considered if these
trends continue," Mr. Jeffrey added.

Marsh's lease-adjusted operating margin is trending at about 5%
compared with 5.4% in fiscal 2001. Lease-adjusted EBITDA
interest coverage is trending at about 2.0x compared with 2.3x
in fiscal 2001. Total debt to EBITDA is 5.3x.  While Standard &
Poor's believes Marsh will be challenged to improve these
measures, the company has identified about $30 million of
improvements which, if achieved, could help to offset continued
weak market conditions.

MICROCELL: Releases Information Circular to Explain CCAA Plan
Microcell Telecommunications Inc. (TSX:MTI.B) filed its
Information Circular and Proxy Statement in Montreal.  The
documents include the Company's Plan of Reorganization and of
Compromise and Arrangement, setting out the terms of the
Company's proposed recapitalization. The principal terms of the
Plan were negotiated with certain of the Company's secured
creditors and affected unsecured creditors.

The meetings of secured creditors and affected unsecured
creditors to vote on the Plan will be held on March 17, 2003.
The Company has already received signed commitments to vote in
favour of the Plan from secured creditors holding approximately
75% of the estimated voting claims relating to the outstanding
secured debt, and from affected unsecured creditors holding
approximately 55% of the estimated voting claims relating to the
outstanding affected unsecured debt. Once effective, the
proposed Plan will significantly reduce the Company's debt
obligations by approximately C$1.7 billion and its annual
interest obligations by a range of approximately C$160 million
to C$200 million.

Acceptance of the Plan requires that it be approved in a vote by
a majority of each of the secured creditors and affected
unsecured creditors, who are present (or represented by proxy)
and voting at the respective meetings of such classes of
creditors, and who respectively represent, in aggregate, not
less than 66 2/3% of the voting claim amounts relating to both
the secured debt and affected unsecured debt, each voting as a
separate class. In addition, implementation of the Plan is
subject to the execution of definitive documentation and to
other customary conditions, including the receipt of all
required Court and other approvals.

The Circular will be mailed to the Company's secured creditors
and affected unsecured creditors within the next few days,
together with materials relating to the meetings thereof to
consider the Plan. The Circular will also be mailed to
shareholders for their information and to provide notice of the
right of any shareholder to attend and be heard at the Court
hearing described below.

The meetings of secured creditors and affected unsecured
creditors will be held on March 17, 2003, beginning at 10:30
a.m. (ET) and 11:30 a.m. (ET), respectively, at the Sheraton
Hotel, in Montreal.

Subject to the Plan being approved at the creditors' meetings, a
hearing is expected to be conducted before the Court to sanction
the Plan on March 18, 2003, at 9:15 a.m. (ET). The hearing will
be held in Montreal at the Palais de Justice, located at 1
Notre-Dame Street East.

The Circular also includes certain operating results of
Microcell for the year ended December 31, 2002. The Company
anticipates deferring the complete issuance of its fourth
quarter and full-year 2002 financial results and related
management discussion and analysis until after the effective
date of the Plan. The Company expects that the effective date
for implementation of the Plan will occur in the month of April
2003. The Company intends to continue conducting its operations
in its usual fashion, providing normal service to its customers,
as it works toward implementing the Plan.

An electronic version of the Circular will be available on Sedar
at http://www.sedar.comand on the Company's Web site at

An electronic version will also be filed as a Form 6-K with the
United States Securities and Exchange Commission on its EDGAR
system.  Additional copies may be obtained by sending an e-mail
message to or by calling the
investor relations department at 514 937-2121, ext. 6034.

Microcell Telecommunications Inc. is a provider of
telecommunications services in Canada dedicated solely to
wireless. The Company offers a wide range of voice and high-
speed data communications products and services to approximately
1.2 million customers. Microcell operates a GSM network across
Canada and markets Personal Communications Services (PCS) and
General Packet Radio Service (GPRS) under the Fido(R) brand
name. Microcell Telecommunications has been a public company
since October 15, 1997, and is listed on the Toronto Stock
Exchange under the stock symbol MTI.B.  Fido is a registered
trademark of Microcell Solutions Inc.

NEW POWER: N.D. Ga. Court Confirms Subsidiary's Chapter 11 Plan
NewPower Holdings, Inc. (Pink Sheets:NWPW) announced that at a
hearing on February 12, 2003, the Honorable W. Homer Drake, Jr.
of the U.S. Bankruptcy Court for the Northern District of
Georgia, Newnan Division, confirmed the Second Amended Chapter
11 Plan, solely as it applies to the Company's subsidiary, The
New Power Company.

The Company expects the Bankruptcy Court to issue its order
regarding this confirmation in the next several days. The
effective date of the plan would occur 10 days following the
issuance of the order, at which time NewPower will begin paying
the allowed pre-petition claims of its creditors.

Pursuant to the Plan, holders of allowed unsecured claims
asserted against NewPower will receive distributions totaling
approximately $8.1 million, representing payment in full of
allowed claims plus interest from June 11, 2002, the date the
Company and its subsidiaries filed voluntary petitions under
Chapter 11 of the U.S. Bankruptcy Code.  NewPower will transfer
any cash remaining after such payment to TNPC Holdings, Inc., in
satisfaction of all intercompany debt outstanding between them.

Judge Drake continued the hearing on confirmation of the Plan
with respect to NewPower Holdings, Inc. and TNPC to February 28,
2003 at 11 a.m.

NORSKE SKOG: Standard & Poor's Cuts Corp. Credit Rating to BB
Standard & Poor's Ratings Services today said it lowered its
long-term corporate credit rating on pulp and paper producer
Norske Skog Canada Ltd. (NorskeCanada) to 'BB' from 'BB+' on
expectations of continued weak credit measures that are unlikely
to improve in the near term to levels commensurate with the
previous rating.

At the same time, the senior unsecured debt rating on the
Vancouver, B.C.-based company was lowered to 'BB' from 'BB+',
and the 'BB+' rating on the C$350 million secured credit
facility due 2005 was affirmed. The outlook is stable.

Despite the May 2002 issue of equity and subsequent reduction in
debt, unfavorable newsprint and pulp conditions through 2002
have severely affected profitability and cash flow protection to
well below targeted levels.

The company's C$350 million credit facility is rated one notch
higher than the corporate credit rating, reflecting good
prospects for recovery in a projected post-default scenario.

"Although market conditions have strengthened recently from very
low levels, a quick recovery that would substantially improve
NorskeCanada's credit profile is not expected," said Standard &
Poor's credit analyst Clement Ma.

The ratings on NorskeCanada reflect the company's average cost
position in groundwood papers, narrow revenue base, and moderate
financial policies.

NorskeCanada is the third-largest groundwood paper producer in
North America, and the largest along the west coast. The
company's concentration in newsprint and other groundwood
papers, which account for more than 75% of sales, exposes it to
significant price volatility in these segments. The effect of
this cyclicality on profitability is further intensified, as
witnessed during the current downturn when prices for market
pulp, which accounts for 17% of volumes, declined in tandem with
paper prices.

In 2003, a slow recovery in newsprint demand will limit
meaningful improvement in profitability, cash flow protection,
and other credit measures.  Nevertheless, strong operating
performance at the peak of the cycle should ensure that the
company averages EBITDA interest coverage of 4.0x and funds
from operations to total debt of 15% to 20% through the cycle.

NRG ENERGY: Inks Deal with Executives to Dismiss Involuntary
NRG Energy, Inc., a wholly owned subsidiary of Xcel Energy
(NYSE:XEL), releasing no details about the deal, reached a
settlement with all seven former executives who filed an
involuntary Chapter 11 petition against NRG late in 2002. NRG
will ask the U.S. Bankruptcy Court for the District of Minnesota
to approve the settlement and dismiss the petition.

"This agreement with the petitioners is in the best interests of
NRG and all its creditors," said Scott J. Davido, NRG general
counsel. "We are continuing at this time to develop a debt-
restructuring plan with our creditors, outside of court, that
will return NRG to sound financial health."

The company noted that the settlement with the former executives
is subject to approval from the U.S. Bankruptcy Court for the
Minnesota District. No hearing to approve the settlement has
been set at this time. A hearing on dismissal of the involuntary
petition is currently scheduled for April 29. As part of the
settlement, the former executives will not oppose dismissal of
the petition.

NRG Energy develops and operates power generating facilities.
NRG's operations include competitive energy production and
cogeneration facilities, thermal energy production and energy
resource recovery facilities.

Xcel Energy is a major U.S. electricity and natural gas company
with regulated operations in 12 Western and Midwestern states.
The company provides a comprehensive portfolio of energy-related
products and services to 3.2 million electricity customers and
1.7 million natural gas customers through its regulated
operating companies. In terms of customers, it is the fourth-
largest combination natural gas and electricity company in the
U.S. Company headquarters are located in Minneapolis.

OAKWOOD HOMES: Closes on $140 Million Revolving DIP Facility
Oakwood Homes Corporation (OTC Bulletin Board: OKWHQ) closed the
up to $140 million revolving line of credit tranche of its $215
million debtor-in-possession financing.

Myles E. Standish, President and Chief Executive Officer,
stated: "We are pleased to close the $140 million revolving line
of credit and expect to close the remaining $75 million loan
servicing advance line in the next few weeks.

"The primary purposes of the $140 million revolving line of
credit are to support outstanding letters of credit of $38
million, to repay amounts outstanding under our previous $65
million revolving credit facility and to provide additional cash
borrowing capacity while we complete our reorganization. The new
line is collateralized by substantially all of the Company's
assets, excluding loans held for sale."

Oakwood Homes Corporation and its subsidiaries are engaged in
the production, sale and financing of manufactured housing. The
Company's products are sold through Company-owned stores and an
extensive network of independent retailers.

PACIFIC GAS: For Now, Court Says, No New Plans & No More Voting
Judge Montali intends to continue moving the protracted
confirmation hearings on the two competing plans for Pacific Gas
& Electric Corp. along this month and next, prohibit any
additional plan proposals from coming to the court, and refrain
from asking creditors to again express their preference for
which plan they like.

On November 7, 2002, the Official Committee of Unsecured
Creditors and the California Public Utilities Commission filed
their Joint Motion Of The [Committee] And The [CPUC] For An
Order Approving (1) Procedures For Resolicitation Of Preferences
Concerning Competing Plans Of Reorganization For The Debtor, (2)
Supplemental Disclosures In Connection Therewith, And (3)
Proposed Form Of Ballot.  Pacific Gas and Electric Company
opposed the Preferences Motion and a hearing was held on
November 27, 2002.  After hearing the arguments of the
Committee, the CPUC and the Debtor, as well as other interested
parties, the court invited counsel to consider a procedure for
seeking the preferences of creditors regarding the competing
plans of reorganization. At a hearing on January 16, 2003,
counsel for Debtor advised that he saw no practical way to
shorten the estimate of seventy days to solicit the preferences
of all creditors except to shorten to fewer than thirty days the
time individual classes would have to express their preferences.
He explained that while that might be reasonable as to classes
with relatively small numbers of creditors, the larger classes
would present practical problems. Counsel for the CPUC stated
that the confirmation trial was taking a long time and noted
that it might be premature (as of that date) to initiate a
preference solicitation. Counsel for the Committee observed that
the only solution he could see to this problem was to shorten
the time class members would have to submit their preference.
At the conclusion of the hearing the court invited all three
counsel to continue to discuss possible procedures but also
indicated that it might address the issue itself. Not
surprisingly, no new suggestion how to go about soliciting
preferences has been presented. Given the fact that the
confirmation trial will resume next week, the court has decided
to dispose of the Preferences Motion.

On December 20, 2002, the Debtor filed its Motion For Order
Further Extending Exclusivity Period For Plan Of Reorganization.
The Exclusivity Motion was opposed by Merced Irrigation
District, Northern California Power Agency, City of Santa Clara,
and the City of Palo Alto. The CPUC took no position on the
Exclusivity Motion and the Committee offered its comments,
suggesting that if its and CPUC's present plan of reorganization
is not confirmed, third parties should be given the opportunity
to present alternative restructuring proposals, working through
and with the Committee.

The court held a hearing on the Exclusivity Motion on January
22, 2003. At the conclusion of the hearing the court indicated
its ruling, namely that at the present time exclusivity would be
continued as it presently exists, and that the court would issue
an appropriate order at an appropriate time.

In a Memorandum Decision the court sets forth its reasons
for granting the Exclusivity Motion and denying the Preferences

As all parties are fully aware, the court is in the midst of
an extremely lengthy, complex and expensive confirmation trial
regarding Debtor's September 20, 2001 Plan Of Reorganization
Under Chapter 11 Of The Bankruptcy Code For Pacific Gas and
Electric Company (as amended from time to time the "PG&E Plan")
and the April 15, 2002 California Public Utilities Commission's
Plan Of Reorganization Under Chapter 11 Of The Bankruptcy Code
For Pacific Gas and Electric Company (as amended from time to
time, and as of October 23, 2002, jointly sponsored by the
Committee as a coproponent, the "Joint Plan"; together with the
PG&E Plan, the "Competing Plans"). So far the confirmation trial
on the Competing Plans has taken twenty-three days and is
scheduled for ten more days this month and at least twelve days
in March. The court cannot even guess when all of the evidence
will finally be submitted nor when the parties will be invited
to present arguments in support of their respective positions.

Twice during the course of this Chapter 11 case the court has
altered Debtor's plan exclusivity over its objection. On March
11, 2002, it terminated exclusivity and permitted the CPUC to
file what ultimately became the Joint Plan. By its order filed
on July 9, 2002, the court terminated exclusivity as to the
Committee.  The Committee's subsequent joinder with CPUC in
support of the Joint Plan presumably is the reason why it has
not filed a plan of its own.

At the January 22, 2003 hearing on the Exclusivity Motion,
several objectors contended that the court should terminate
exclusivity if for no other reason to "level the playing field"
and provide an environment that would permit objectors and
others the comfort of knowing that they have the right to file a
plan if they choose to do so. Without factual support, one
objector contended that prospective plan proponents feared
retaliation by Debtor if they actively support an alternative
plan. Despite the rhetoric, there is no evidence either of the
existence of an alternative plan or any that any would-be plan
proponents have been deterred from coming forth and seeking
permission to file a plan. The court further notes that as far
back as June 27, 2002, at a hearing on an extension of
exclusivity, it invited any serious proponent who wished to file
a plan to come forward and seek to have exclusivity terminated
on an expedited basis.

Nothing has changed since then. No other proponent has come
forth with an alternative to the PG&E Plan and the Joint Plan,
notwithstanding the frequent discussions throughout this case of
a so-called "Plan C," the unspecified plan that would likely
emerge if confirmation is denied both of the Competing Plans.

The court remains convinced that no purpose would be served
by permitting parties to file plans at this time. As noted on
January 22, it is possible that the PG&E Plan or the Joint Plan
will be confirmed. If that happens, a new Plan C would have no
constructive effect and might only confuse the vast universe of
parties (creditors, rate payers, the public) interested in a
successful resolution of this important Chapter 11 case.

Further, as long as the Competing Plans remain supported by
their respective proponents, and as long as the court has not
denied confirmation of either or both of those plans, the court
would not likely permit the confirmation and disclosure
statement process to recommence as to any other plan.

That being said, the court is mindful of the need to provide
a readily accessible vehicle for consideration of Plan C if and
when the Competing Plans no longer constitute viable
alternatives for resolution of this case. Thus, it is the
court's determination that exclusivity should remain in its
present posture, i.e., with the Competing Plans being tested for
confirmation while the Committee remains authorized to file its
own plan if and when it chooses. Whenever the situation changes
the court may issue another order further terminating
exclusivity, in whole or in part. Of course, any party in
interest remains free to move to seek termination.

As to the Preferences Motion, the court is fully aware of
several irrefutable facts: (1) when creditors were asked to vote
to accept or reject the PG&E Plan and the CPUC Plan (before it
became the Joint Plan), only those creditors who voted to accept
both plans were permitted to express their preference as to
which plan should be confirmed. This is completely consistent
with 11 U.S.C. Sec. 1129(c); (2) the PG&E Plan was accepted by a
substantial number of creditors and all but one impaired class
of creditors; the CPUC Plan (again, before it became the Joint
Plan) was accepted by only one impaired class; (3) the
Committee's joinder with the CPUC in support of the Joint Plan,
as well as substantive changes from the CPUC Plan, not the least
of which are the presence of the Reorganization Agreement and
the CPUC's consent to jurisdiction in this court to enforce that
agreement and the Joint Plan, are significant; and (4) numerous
events have occurred since the original preference solicitation
that may materially influence a creditor in expressing that
creditor's preference for the PG&E Plan over the Joint Plan, or
the Joint Plan over the PG&E Plan.

Nevertheless, this case is far too much in "real time," with
changes happening almost weekly both within the Chapter 11 case
and outside in other places such as state and federal
administrative agencies, state and federal courts, and the
California Legislature, to know when to assemble all "relevant"
information to solicit preferences once again. There is no
realistic way to pick a precise time to close off the
information that may be useful to permit a creditor to express a

No doubt as soon as a resolicitation process began some other
material event would occur, thus rendering the information
incomplete, at best, and perhaps even out of date or misleading.
Similarly the court is unable to fashion any meaningful way
to go about obtaining the preferences of creditors and then
determining what to do with those preferences once received. The
court is well aware of the forces at play during the
confirmation process and could no doubt identify readily the
preferences of numerous active participants in this case. While
it could not glean the preferences of significant parties who
have not taken an active role in the case, the court does not
believe that it would be useful or helpful to try to oversee a
lengthy, expensive and time consuming "straw poll" of the
creditor body.

From a practical point of view there are other reasons that
lead the court to conclude that no further preference
solicitation should be conducted. First, to do so would be an
idle act if either of the Competing Plans is denied confirmation
or is withdrawn. Second, there remains the possibility that both
plans will be denied confirmation. The court cannot forget the
fact that each proponent has vowed to defeat the competing plan.
Third, the volume of material in the form of documentary
evidence, witness testimony and legal arguments presented in the
confirmation trial create a daunting task to this court to make
a prompt decision on confirmation of the Competing Plans once
the confirmation trial is over and the matters are submitted for
decision. Only if and when it determines that both Competing
Plans are confirmable, would a preference solicitation serve any
purpose. However, many parties have expressed their concerns
about a lag time between confirmation and an Effective Date of a
confirmed plan. While it will be difficult enough for the court
to sift through the evidence and to apply the law to get to
confirmation, it has no desire to put the entire case "on hold"
while some sort of preference solicitation takes place. Not only
are the practical burdens significant, but, as noted above, the
court is without guidance as to what it would do with the
preference votes. In this regard the court is persuaded by many
of the reasons set forth by Debtor in its opposition to
Preference Motion. Those reasons will not be repeated here.
Lest the parties believe the court is thinking of abrogating
its responsibilities under 11 U.S.C. Sec. 1129(c) that is not
the case at all. Rather, the court expects active parties to
voice their preference in their closing arguments to be
submitted for or against confirmation of the Competing Plans.
Parties who have not been active in the confirmation trial are
free to file written statements of preference and the court
expects Debtor on the one hand, and the CPUC and the Committee
on the other hand, to advise the court of any statements of
preference for their respective plan filed in this case. However
the preferences are communicated to the court, it will give
whatever weight to that information it deems appropriate.

PACIFIC GAS: Standard & Poor's Provides Preliminary Debt Ratings
Standard & Poor's Ratings Services disclosed that it has
furnished Pacific Gas & Electric Co. (PG&E; D/--/D) with
preliminary ratings indications for the approximately $8.5
billion of debt forecast for the four companies that it has
proposed to create to succeed PG&E upon emergence from
bankruptcy.  A preliminary rating evaluation is not a rating.
It is solely a credit opinion based on the facts and
circumstances presented to Standard & Poor's by PG&E.

Standard & Poor's has concluded that if PG&E's reorganization
plan is conformed to reflect the company's updated financial
forecasts, the plan is confirmed by the bankruptcy court, it is
implemented within the contemplated time frame, all necessary
regulatory approvals are received, and the several preconditions
to the assignment of investment grade ratings cited by Standard
& Poor's have been met, each of the four companies proposed to
succeed PG&E will be capable of achieving investment-grade
ratings of at least 'BBB-'.

A list of Standard & Poor's conditions for the assignment of
investment grade ratings is included in Standard & Poor's letter
to PG&E that is appended to this press release.

Standard & Poor's preliminary rating evaluation reflects the
financial and operational forecasts underlying the plan and any
material deviations from the proposed plan could result in a
lower rating. A definitive ratings opinion will require
additional assessment and a greater level of detailed analysis
at the time a plan is implemented.

A key element of PG&E's plan is the division of the company's
operating activities among the four companies that will succeed
it. Current PG&E operating activities, such as electricity
generation, electricity transmission, and natural gas
transmission, will be ceded to three limited liability
companies. These companies will be subsidiaries of a single
holding company that will not be related to the electric and gas
distribution company that will also succeed PG&E. The three
companies engaged in electric generation, electric transmission
and gas transmission would be subject to FERC regulation, rather
than California Public Utilities  Commission (CPUC) oversight.
The stand-alone retail electric and natural gas distribution
company will be spun-off from PG&E Corp. as part of the
reorganization, will bear the PG&E name, and will continue to be
regulated by the CPUC.  Disaggregation and the transfer of
regulatory control are contingent upon bankruptcy court
confirmation and FERC, SEC, and NRC approvals.

Cash on hand, together with debt to be issued by the four
companies, is to be used to extinguish PG&E's existing
obligations, including defaulted debt and trade obligations.
With the exception of outstanding pollution control bonds that
are to be reinstated, claims of PG&E's secured bondholders will
be satisfied with cash. Unsecured bondholders' claims will
largely be discharged through combinations of cash and
substitute debt obligations to be issued by the successor
companies. Holders of the QUIDS deferrable subordinated
indentures will receive substitute debt obligations of the new
generation company.

The plan is founded on the assumption that the newly created
generation company will sell all of its output to the electric
and gas distribution company at FERC-approved prices that are
reflective of long-term, fixed-price wholesale electric power
contracts, rather than production costs, as sought by the state.

PG&E is seeking a determination from the FERC that the terms of
the proposed power sales agreement, including the rates to be
paid by the distribution company, are just and reasonable.
Standard & Poor's ability to ultimately assign investment-grade
ratings to the successor companies hinges on a FERC finding that
the proposed wholesale power rates are just and reasonable, as
well as CPUC action providing for the timely recovery of those
costs through the distribution utility's retail rates.

To achieve the transfer of operating assets to successor
companies, and the shift of a significant portion of regulatory
oversight to the FERC from the CPUC, PG&E must establish that
federal law preempts numerous state laws and regulations that
govern PG&E's operations. California officials have vigorously
objected to these and other provisions of PG&E's plan. In
addition to the need to clear these major hurdles, the plan
contains myriad elements and assumptions that need to be
realized without any material deviation that might erode
projected cash flows and credit quality.

The assignment of definitive investment-grade ratings to the
successor companies by Standard & Poor's will depend on the
ultimate outcome of the bankruptcy proceedings.

Standard & Poor's Feb. 19, 2003 Letter to PG&E:

Mr. Peter A. Darbee
Senior Vice President and Chief Financial Officer
PG&E Corporation
One Market, Spear Tower
Suite 2400
San Francisco, California  94105

Dear Mr. Darbee:

      Pursuant to your request, Standard & Poor's has performed a
preliminary rating evaluation of the corporate credit ratings
of, and the approximately $8.5 billion of secured debt
("Securities") to be issued or reinstated by, the four companies
that have been proposed to succeed the debtor, Pacific Gas and
Electric Company ("PG&E"), in connection with its emergence from
bankruptcy should the Plan of Reorganization ("Plan") proposed
and filed by PG&E in its Chapter 11 bankruptcy proceedings be
adopted.   The four companies include: an electric and gas
distribution company ("the distribution company"); an electric
transmission company; a gas transmission company; and an
electric generation company ("the four companies").

      In arriving at this preliminary rating evaluation, we have
had discussions with PG&E and its advisors.   We have also
reviewed materials supplied to us by representatives of PG&E
including, but not limited to:

       -- The PG&E Plan;

       -- The April 19, 2002 Disclosure Statement accompanying
          the PG&E Plan;

       -- Regulations promulgated by the California Public
          Utilities Commission ("CPUC");

       -- The revised financial model ("Model"), including
          financial forecasts and assumptions supplied to
          Standard & Poor's by representatives of PG&E on
          February 10, 2003; and

       -- Such other materials as we have deemed appropriate.

      Based upon our review, it is Standard & Poor's current
opinion that the approximately $8.5 billion of Securities
proposed to be issued by the four companies, as well as the
corporate credit ratings of the four companies proposed to
succeed PG&E, would be capable of achieving investment grade
ratings of at least 'BBB-'.  Please note that the ultimate
assignment of investment grade ratings hinges on the
satisfaction of each of the several conditions cited in Appendix
"A" to this letter.

      A preliminary rating evaluation is not a rating. A
preliminary rating evaluation is solely a credit opinion based
on the facts and circumstances presented to us by PG&E.  This
preliminary rating evaluation should be understood as qualified
by the fact that (i) additional information or changes to the
information previously presented to us may result in credit risk
stronger or weaker than that suggested by the preliminary rating
evaluation and, consequently, a different definitive rating;
(ii) the preliminary rating evaluation is not a prediction of
the actual future performance of the Securities; (iii) Standard
& Poor's does not warrant or endorse suitability of the
preliminary rating evaluation for any particular purpose or use;
(iv) the preliminary rating evaluation is provided without any
express or implied warranties whatsoever; (v) the preliminary
rating evaluation is based solely on information provided to us
by PG&E and does not represent an audit by Standard & Poor's;
(vi) Standard & Poor's relied upon PG&E, its accountants,
counsel and other experts for the accuracy and completeness of
the information submitted in connection with the preliminary
rating evaluation; (vii) the preliminary rating evaluation shall
not be construed to have been undertaken with the rigor and
level of detail required for Standard & Poor's to provide a
definitive rating opinion; and (viii) Standard & Poor's does not
and cannot guarantee the accuracy, completeness or timeliness of
the information relied upon in connection with the preliminary
rating evaluation or the results obtained from the use of such
information.  Please note that the preliminary rating evaluation
speaks only as of the date hereof and is not subject to
surveillance or update. A more comprehensive analysis might lead
to an outcome different than that of the preliminary rating
evaluation.  In addition, the preliminary rating evaluation does
not address the validity of the assumptions made by PG&E in
preparing the Model.

      You may use this preliminary rating evaluation in
connection with proceedings in In re: Pacific Gas and Electric
Company. Standard & Poor's reserves the right to publish this
preliminary rating evaluation and the conditions attendant
thereto and to advise its own clients, subscribers, and the
public thereof.

      PG&E understands that Standard & Poor's has not consented
to, and will not consent to, being named an "expert" under the
federal securities laws, including without limitation, Section 7
of the Securities Act of 1933.  In addition, it should be
understood that the preliminary rating evaluation is neither a
"market" rating nor a recommendation to buy, hold, or sell the

      We are pleased to have been of service to PG&E. If we can
be of further assistance, please do not hesitate to contact us.

Very truly yours,


                       -- Appendix A --

      The results of Standard & Poor's preliminary rating
evaluation, set forth in the February 19, 2003 letter, are
predicated upon the satisfaction of each of the following
conditions (a) through (kk):

      a) The Plan will be conformed to the financial Model that
PG&E furnished to Standard & Poor's on February 10, 2003, the
Plan is confirmed and implemented substantially in the form
proposed by PG&E, and is confirmed within the time frame
contemplated by PG&E;

      b) All financial targets set forth in the revised Model are
substantially attained by each of the four companies without any
material deviation from the projected results, each can
successfully access capital markets to the extent forecast, each
can secure any assumed liquidity facilities, and forecast cash
balances are available to discharge a portion of creditors'
claims as contemplated;

      c) The Utility Reform Network's appeal to the 9th Circuit
Court of Appeals, that challenges on both procedural and
substantive grounds the settlement agreement reached between
CPUC and Southern California Edison Company ("SCE") in SCE's
"filed rate doctrine" litigation, does not establish legal
precedents that defeat, diminish or impair the cash balances
PG&E has forecast to be available for the satisfaction of
creditors' claims, or defeat, diminish or impair PG&E's
entitlement to recover historical power procurement costs;

      d) The amount of claims made against the bankruptcy estate
are substantially as estimated by PG&E's Plan;

      e) Debt at each of the four companies will be secured debt,
the amount of debt throughout the forecast will be no greater
than the levels projected in the Model, the debt will be
amortized as forecast, and interest costs do not materially
exceed anticipated levels, noting that for analytical purposes
Standard & Poor's examined the generation company using a 10%
interest rate;

      f) Debt of the yet-to-be-named parent of the electric
transmission company, gas transmission company and electric
generation company ("Parent" or "Parent and its three
subsidiaries"), will be reduced by at least $500 million prior
to or simultaneous with the emergence of PG&E from bankruptcy,
such debt reduction will be accomplished with Parent's cash on
hand, and Parent's administrative expenses are consistent with
those forecast in the Model;

      g) PG&E Corporation will issue $700 million of equity whose
proceeds will be deployed, on or before emergence from
bankruptcy, to reduce the four companies' debt to levels
consistent with the Model, and such equity issuance
will take place unless other monies - whether resulting from
lower than anticipated creditor claims, FERC-ordered generator
refunds, or other sources - are available to be applied to debt
reduction and can obviate or mitigate the need for the equity

      h) The electric generation company will establish and fund
a debt service reserve account and an operating reserve account,
the latter to be held to defray expenses associated with the
shutdown of the Diablo Canyon Nuclear Power Plant ("Diablo"),
currently projected to be incurred in or about 2022,
2023 and 2024, such reserves will be funded in accordance with
the schedule established in the Model, will be restricted as to
use, and, if monies on deposit in the debt service reserve
account are drawn during the forecast period and rated debt
remains outstanding at the electric generation company,
the debt service reserve account will be replenished from first
available funds without compromising operating reserve account
balances or any scheduled additional deposits to the operating
reserve account;

      i) With the exception of draws on working capital
facilities whose cumulative drawn balances do not exceed $100
million as a result of the use of the facilities, the electric
generation company will not issue any debt beyond the amount
forecast in the Model without first obtaining from Standard &
Poor's confirmation that the issuance of such additional debt
will not cause any investment grade ratings assigned to
outstanding electric generation company debt to be downgraded to
speculative grade from investment grade;

      j) Parent and its three subsidiary companies will not take
any actions that are inconsistent with the representations made
by PG&E to Standard & Poor's that Parent's National Energy Group
family of companies subsidiaries ("NEG"), their assets and their
business activities are not strategic to the operations and
viability of Parent and Parent's other three subsidiary
companies, because Standard & Poor's has relied upon this PG&E
representation in concluding that it could exclude NEG's
financial data from the consolidated financial analysis
of Parent and its other three subsidiary companies, and it is
Standard & Poor's opinion that if NEG had been included in the
consolidated financial analysis of Parent and its other three
subsidiary companies, the corporate credit and debt ratings of
the electric generation, electric transmission, and gas
transmission companies, would be incapable of achieving
investment grade ratings;

      k) Neither Parent nor its three subsidiaries will issue
debt for the purpose of infusing capital into any of the NEG
companies, moreover, neither Parent nor its three subsidiary
companies other than NEG shall transfer, dividend or otherwise
deploy available cash balances to NEG if such use of cash will
result in the issuance of debt by Parent or its three subsidiary
companies other than NEG;

      l) PG&E obtains all approvals from regulatory bodies
required for the implementation of the Plan and the Model,
including, but not limited to, approvals from the Federal Energy
Regulatory Commission ("FERC"), the Nuclear Regulatory
Commission, and the Securities and Exchange Commission;

      m) The bankruptcy court will, as contemplated by the Plan,
(1) issue valid orders that override all California legislation
and regulations that are inconsistent with the Plan, including,
but not limited to, those that preclude PG&E from transferring
generation assets to third-parties, (2) approve the proposed
twelve-year power sales agreement ("PSA") between the
distribution company and the electric generation company as
successors to PG&E under the Plan, (3) enforce the PSA in
accordance with its terms, and (4) approve the transfer of
electric transmission, gas transmission, and electric generation
assets to the appropriate companies as  contemplated by the

      n) FERC finds the wholesale power rates proposed under the
PSA to be just and reasonable;

      o) The rates payable by the distribution company to the
electric generation company will not be reduced through
renegotiation or otherwise during the life of the PSA, and the
obligations created under the PSA contract may not be
extinguished or terminated by the parties thereto;

      p) The electric generation company will contract all of its
owned capacity and energy to the distribution company for eleven
years and approximately half of such capacity and energy in the
twelfth year, and the distribution company will make capacity
and energy payments to the electric generation company as
contractually provided;

      q) For so long as the PSA is in effect, the electric
generation company's ability to divest generation assets will be
restricted as contractually provided;

      r) Hydrology conditions are consistent with the average-
year levels set forth in the Model presented to Standard and
Poor's by PG&E, and Diablo will exhibit capacity and
availability factors consistent with those represented in the
Model without any meaningful degradation associated with steam
generator tubes or otherwise;

      s) The ability of the distribution company to procure power
at the prices anticipated under the PSA will not be frustrated
by any inability of the electric generation company to dispatch
its units due to either operational problems, transmission
congestion, or emergencies declared by legislative or regulatory
bodies within the state of California or federal agencies;

      t) Following the January 1, 2006 expiration of those
provisions of California Assembly Bill 57 / Senate Bill 1078 of
2002 that cover the timeliness of utility cost recovery, the
CPUC will continue to act in a manner consistent with the
provisions of that legislation, even though no longer
legislatively mandated to do so;

      u) The CPUC will provide for the distribution company to
recover, in a timely manner that does not compromise cash flow,
all power and fuel procurement expenses, whether related to the
PSA, bilateral contracts, QF contracts, net open position, other
sources of supply, or the retail gas distribution system;

      v) Recovery of expenses identified in the preceding
paragraph will occur irrespective of amounts of electricity that
the distribution company sells as retail or surplus, or is
deemed to have sold as surplus under CPUC regulations, and the
distribution company will generally earn the contemplated
rate of return without any material deviation from projected

      w) During any period, including, but not limited to, off-
peak periods, or the period following any customer losses due to
retail choice, to the extent that the distribution company's
electric and gas purchases exceed the distribution company's
customers' retail demand, the distribution company will be
permitted to resell to third-parties the surplus portions of the
electricity and gas that must be purchased by the distribution
company under the PSA, QF contracts, bilateral contracts, or
from other sources of supply, and the distribution company will
be capable of making such arrangements as will permit it to
achieve its forecast financial results;

      x) The amount of collateral that PG&E must post to procure
net open position power or any other electricity is consistent
with the levels projected in the Model, and capital costs
associated with collateral are recoverable in rates;

      y) The bankruptcy court, notwithstanding any contrary state
law, regulation or policy, will prohibit or shield the
distribution company from assuming financial responsibility for
California Department of Water Resources ("CDWR") energy
contracts, and Standard & Poor's further assumes that any action
to the contrary that assigns financial responsibility for CDWR
contracts to the distribution company will impair any investment
grade ratings then assigned to the distribution company and lead
to the assignment of speculative grade ratings;

      z) The financial performance of the distribution company
will not be materially compromised by (1) the operational and
dispatch responsibility for CDWR contracts that has been vested
in PG&E by the CPUC, (2) the sale of surplus CDWR capacity by
PG&E on behalf of CDWR, (3) any methodology created by the CPUC
for the measurement of surplus sales, or (4) the allocation and
recovery of CDWR contract costs;

      aa) FERC authorizes the electric transmission company to
earn the rate of return assumed in the Model;

      bb) The gas transmission company acquires, as contemplated
by the Plan, a segment of gas pipeline within Oregon, currently
owned by National Energy Group's Gas Transmission Northwest
Corporation, the acquisition will be made at a price that is not
inconsistent with the financial forecast and, through such
acquisition, the gas transmission company will be deemed to be
an interstate pipeline subject to FERC jurisdiction and

      cc) FERC assumes jurisdiction over the gas transmission
company's operations, materially displaces state regulation,
permits the gas transmission company to enter into long-term
contracts, and authorizes the gas transmission company to
earn the rate of return assumed in the Model;

      dd) The majority of the "qualifying generation facilities"
("QF") will operate under the fixed energy price arrangements
that expire in 2006 that are reflected in the Model, the
remaining QF facilities will operate under the other contractual
arrangements embedded in the Model, and after the expiration
of such QF contracts, the distribution company will be able to
recover the costs of replacement power and such costs will be
consistent with those forecast in the Model;

      ee) Should the CPUC reject any or all of the distribution
company's proposed electric procurement plans, or portions
thereof, the distribution company will be able to secure
alternative wholesale electric supplies at prices acceptable
to the CPUC, and the costs associated with such electric supply
will be recoverable in rates in a timely manner;

      ff) The California Independent System Operator ("California
ISO"), while acting in its intermediary role as a clearinghouse
for the settlement of payments for transmission transactions,
will not materially impair the cash flow of the electric
transmission company or any of its affiliate companies;

      gg) The distribution company's ability to dispatch the
generation units and the electric generation company's ability
to earn its anticipated revenues are not impaired as a result of
any action of the California ISO in its oversight of the state's
transmission network, in its provision of access to the network,
or as a result of congestion upon such transmission network;

      hh) FERC's implementation of Standard Market Design will
not materially impair the forecast cash flow of the distribution
company, the electric transmission company, the electric
generation company, or the gas transmission company;

      ii) Any financial obligations arising from the several
compressor station chromium contamination litigations pending
against PG&E, do not impair the financial results forecast in
the Model;

      jj) The final order of the bankruptcy court will preempt
any inconsistent findings, orders or regulations of the CPUC
arising from hearings opened by the CPUC on January 7, 2003, to
examine the merits of the competing reorganization plans that
have been proposed for PG&E by CPUC and PG&E; and

      kk) Evidence that CPUC has developed and implemented a
methodology for the prospective approval of the prudence and
reasonableness of the distribution company's risk management and
risk tolerance activities, and evidence that the CPUC will
permit as a ministerial matter the recovery of the distribution
company's costs of securing risk management tools and also
permit the recovery of costs associated with that portion of the
power and fuel portfolio that is not hedged.

PALLET MANAGEMENT: Files Chapter 11 Petitions in S.D. Florida
Pallet Management Systems, Inc. (OTCBB:PALT) and certain of its
subsidiaries filed a voluntary petition for protection under
Chapter 11 of the United States Bankruptcy Code with the
Bankruptcy Court for the Southern District of Florida.  In
connection with the filing, Pallet Management has arranged for
short-term interim financing from LaSalle Business Credit, LLC,
in Chicago, Illinois. The financing will enable it, subject to
Bankruptcy Court approval, to continue its business operations
as usual, including having funds available to meet future
inventory needs and fulfilling the obligations associated with
its business, including the prompt payment of new vendor
invoices. Pallet Management has retained Genovese Joblove &
Battista, P.A. as its bankruptcy counsel.

In addition to restructuring its manufacturing operations,
Pallet Management will use the bankruptcy process to evaluate
its existing plants and its distribution, logistics and
information technology functions. After reorganization, Pallet
Management intends to emerge with an Indiana facility, which
continues to supply that facility's primary customer, and with a
shift in focus toward services and cost efficiency by offering
"state of the art" logistical services known as "Reverse
Distribution." In addition, Pallet Management hopes to continue
developing its PalletNet website offering reverse distribution,
single-source national contracts, high-quality shipping
platforms and transport packaging, recovery, repair, and
recycling to a national customer base.

"We enter into our post Chapter 11 filing optimistic that our
new structure will create the foundation to once again grow,"
said Marc Steinberg, Vice President and Chief Financial Officer.
"Performing under the demands of our existing contracts
prevented growth and, coupled with the current lumber market,
contributed to our need to file for reorganization. As we engage
in pallet manufacturing and reverse distribution opportunities
post-filing, our optimism throughout our new organization is

Additional information about Pallet Management Systems, Inc. is
available at

PANACO INC.: Judge Clark Approves Continued Cash Collateral Use
Panaco Inc. received continued authority from the U.S.
Bankruptcy Court for the Southern District of Texas to use cash
collateral securing repayment of a prepetition loan from
Foothill Capital Corp. to pay post-petition operating expenses.
Judge Letitia Z. Clark finds that there's no other financing
alternative and that the basket of post-petition replacement
liens and superpriority claims offered by Panaco is adequate to
protect Foothill's secured position.  The cash collateral
financing arrangement runs through April 24, 2003.

Panaco, Inc., is in the business of selling oil and natural gas
produced on properties it leases to third party purchasers. The
Company filed for chapter 11 protection on July 16, 2002.
Monica Susan Blacker, Esq., at Neligan Stricklin LLP represents
the Debtor in its restructuring efforts.  When the Debtor filed
for protection from its creditors, it listed $130,189,000 in
assets and $170,245,000 in debts.

PEREGRINE SYSTEMS: Balks at Committee Hiring Blackstone Group
Peregrine Systems Inc. is opposing a request by its unsecured
creditors' committee to hire Blackstone Group L.P. as a
restructuring consultant, saying there is no need for the
committee to hire the firm, Dow Jones reports.  The software
company said the committee has "apparently already formulated
its own plan of reorganization" for Peregrine Systems, according
to an objection obtained by Dow Jones Newswires.  Also, the
filing said the committee already is using the services of FTI
Consulting Inc., which is more than qualified to provide
restructuring advice and already has done so.  The U.S.
Bankruptcy Court in Wilmington, Del., which is overseeing
Peregrine Systems's case, is set to consider the proposed hiring
at a hearing on Tuesday, according to Dow Jones.

Peregrine Systems, Inc. (OTC: PRGNQ) filed its Plan of
Reorganization and Disclosure Statement on Jan. 20, offering a
blueprint for restructuring the company, including reinstatement
of bondholder claims, full repayment of most unsecured debt
under extended terms, preservation of value for shareholders,
and a proposed resolution of shareholder class action claims.

The Plan also calls for appointing a new, five-member board of
directors for the reorganized company. It would consist of four
independent directors, as well as the company's CEO. Additional
oversight is prescribed to assure independence of individuals
nominated. Peregrine intends to ask the court for approval to
retain an outside search firm to identify and present nominees
for these board positions for appointment by the time the
company emerges from Chapter 11.

Peregrine Systems, Inc., the leading global provider of
Infrastructure Management software, filed for chapter 11
protection on September 22, 2002. Laura Davis Jones, Esq., at
Pachulski, Stang, Ziehl Young & Jones represent the Debtors in
their restructuring efforts.  When the Company filed for
protection from its creditors, it listed estimated debts and
assets of more than $100 million.  More information about
Peregrine is available at

QUANTECH LTD.: Files Chapter 7 Petition in Minnesota
Quantech Ltd. (OTC Pink Sheets: QQQQ) filed a voluntary petition
under Chapter 7 of the United States Bankruptcy Code on Feb. 18,
2003, with the United States Bankruptcy Court, District of

In making this filing, the Board of Directors believes that it
is in the best interests of the Company and its creditors that
the Company seek relief under the provisions of Chapter 7.

In addition, the Company announced the resignation of James
Lyons as Chief Executive Officer and the resignations of Edward
Strickland, James Lyons, Robert Gaines, and Richard Perkins, all
of the members of its Board of Directors.

QUANTECH LTD.: Chapter 7 Case Summary
Debtor: Quantech, Ltd.
         815 Northwest Parkway, Suite 100
         St. Paul, MN 55121

Type of Business: The company was working on commercialization
                   of its FasTraQ(TM)-ER Emergency Room (ER)
                   Patient Treatment Information Platform.  The
                   FasTraQ(TM)-ER allows ER staff to perform a
                   menu of 20 time-critical diagnostic tests for
                   multiple patients, simultaneously and directly
                   from tubes of whole blood.  The platform will
                   also allow the wireless delivery of test
                   results directly to the appropriate ER
                   physician at bedside in less than 15 minutes,
                   through its ReaLinQ(TM) handheld
                   communicators.  Quantech also holds majority
                   ownership of HTS Biosystems, Inc. --
          a company
                   providing its PROTEOMATRIX(TM) solution which
                   is a unique portfolio of innovative,
                   proprietary detection technologies,
                   chemistries and bioinformatics forming a
                   matrix of tools that addresses the proteomics

Bankruptcy Case No.: 03-31134

Chapter 11 Petition Date: February 18, 2003

Court: District of Minnesota

Judge: Kishel

Debtor's Counsel: Paul B. Jones, Esq.
                   Fredrikson & Byron, P.A.
                   4000 Pillsbury Center
                   200 South Sixth Street
                   Minneapolis, Minnesota 55402-1425
                   Telephone: 612-492-7000
                   Telecopier: 612-492-7077

Estimated Assets: $3,795,381 at March 31, 2002
                     $779,946 at December 31, 2002

Estimated Debts:  $9,641,731 at March 31, 2002
                   $3,916,309 at December 31, 2002

                   As previously reported in the Troubled Company
                   Reporter, on October 9, 2002, McGladrey &
                   Pullen, LLP resigned as the Company's
                   principal independent accountant and no audit
                   has been conducted for the fiscal year ended
                   June 30, 2002.

SAFETY-KLEEN: ARMSTRONG: Nails Down Plan Confirmation Procedures
Gearing up a hearing on the adequacy of their Disclosure
Statement today in Wilmington and for confirmation of their
First Amended Plan, Safety-Kleen Corporation and its related and
subsidiary Debtors ask Judge Walsh to:

    * schedule hearing dates for determination of whether the
      Disclosure Statement meets the statutory requirements for
      approval and for confirmation of the First Amended Plan;

    * set a deadline by which any objections to confirmation of
      the First Amended Plan must be filed;

    * temporarily allow certain claims for voting purposes;

    * determine the treatment of unliquidated, disputed or
      contingent claims for voting purposes;

    * set a solicitation record date;

    * approve the content of solicitation packages and non-voting

    * establish a voting deadline, and procedures for voting; and

    * approve the forms for notice, balloting and rejection of
      executory contracts.

                      Hearings and Bar Dates

The Debtors suggest that the hearing on the adequacy of the
Disclosure Statement be set for February 21, 2003, and assuming
the Disclosure Statement is approved, the hearing on
confirmation of the Plan will be held on March 31, 2003,
explaining that these dates will give the Debtors time to
address any objections and give the required length of
notice to all affected parties of the hearing on confirmation of
the Plan.

In conjunction with the hearing date for confirmation, the
Debtors suggest that Judge Walsh set March 24, 2003, as the date
by which any objections to confirmation of the Plan must be
filed.  The Debtors ask Judge Walsh to order now that any
objection to confirmation not timely filed will not be
considered.  Further, any objections must be made in
writing, identify the objector and the amount of any claim or
interest asserted by the objector, state with particularity the
legal and factual basis for the objection, and be filed and
served so as to be received by counsel for the Debtor, the
Committees, the pre-petition lenders, the DIP Lenders and the US
Trustee no later than the bar date for such objections.

                Temporary Claim Allowance For Voting

Fed R Bankr Pro 3018(a) permits a court to temporarily allow a
claim to which an objection has been made in whatever amount the
court deems proper for voting on acceptance or rejection of a
plan.  The Debtors ask Judge Walsh to set March 14, 2003, as the
deadline by which a claimant must bring a motion under this rule
to obtain temporary voting status.  The Debtors include the same
requirements of content and notice for these motions as for
objections to confirmation, and asks that Judge Walsh refuse to
hear any such motions that don't meet these requirements of
timeliness and content.

If a Rule 3018 motion is filed, the Debtors propose that the
claim be provisionally counted in determining whether the plan
has been accepted or rejected, pending a final determination of
the claim's voting status at the confirmation hearing.
Therefore, the Debtors will supply any party holding a contested
claim which files a Rule 3018 motion with a ballot for the
casting of a provisional vote to accept or reject the Plan.
Thereafter, if the Debtors and the claimant are unable to
resolve the issues raised in the Rule 3018 Motion before the
voting deadline, the Rule 3018 Motion will be determined by
Judge Walsh at the confirmation hearing, and she can then
determine whether the provisional ballot should be counted as a
vote on the Plan and, if so, the amount, if any, in which the
claimant will be allowed to vote.

Following this procedure and deadline will afford the Debtors
sufficient time to consider and, if necessary, contest or seek
to resolve the Motion, and will help to ensure that an accurate
tabulation of ballots is completed by the confirmation hearing

                   No Voting for Contingent,
               Unliquidated or Disputed Claims

However, the Debtors request that Judge Walsh direct that
creditors holding certain types of non-voting claims be denied
treatment as creditors with respect to the claims for purposes
of voting on or receiving distributions under the Plan, and
receiving notices other than publication.

These include:

        (a) Claims described in the Debtors' Schedules as
            contingent, unliquidated or disputed, and which
            were not the subject of:

              (i) a timely filed proof of claim or

             (ii) a proof of claim deemed timely filed
                  under the Bankruptcy Code or court
                  order; and

        (b) Claims which were not scheduled and were not
            the subject of:

              (i) a timely filed proof of claim or

             (ii) a proof of claim deemed timely filed
                  under the Bankruptcy Code or court

Any claim which meets this description and to which an objection
has been filed before confirmation of the Plan will neither be
entitled to vote on the Plan, nor be counted in determining
whether the requirements of the Bankruptcy Code have been met
with respect to the Plan unless:

        (1) the Claim has been temporarily allowed for voting
            purposes under Bankruptcy Code 3018(a), or

        (2) the objection to the Claim has been resolved in
            favor of the creditor asserting the Claim.

For purposes of voting, the Debtors propose that the amount of a
Claim used to calculate acceptance or rejection of the Plan will

        (a) the amount of the Claim that has been scheduled by
            the Debtors, if the claim is not scheduled at zero
            or disputed, contingent or unliquidated, and the
            Claim is the subject of a timely filed proof of

        (b) the liquidated amount specified in a proof of claim
            that was or is deemed timely filed under applicable
            law and any applicable orders of the Court and that

              (i) not objected to; or

             (ii) otherwise allowed by a final order of the
                  Court for voting under a Rule 3018 Motion.

The Debtors propose that any claim as to which a separate
objection has been filed before confirmation of the Plan will
not be entitled to vote on the Plan or counted in determining
whether the Debtors have met the requisite percentage of
favorable votes for confirmation, unless the objection has been
resolved in favor of the creditor, or unless a Rule 3018 motion
is filed on account of the claim in accordance with the
proposals for provisional allowance.

Ballots cast by a creditor who has filed a proof of claim in an
unliquidated or contingent amount has been filed which is not
the subject of an objection filed before the confirmation
hearing, the claim should be counted for purposes of satisfying
the numerosity requirement of the Bankruptcy Code, but should
not be counted toward satisfying the aggregate amount, unless
temporarily allowed by the Court in a specific amount for voting

                      Solicitation Record Date

The registrars of the Debtors' securities need advance notice of
at least three full business days to enable those responsible
for assembling ownership lists of publicly traded debt and
equity securities to compile a list of holders as of a date
certain.  Accurate lists often cannot be prepared retroactively
as to ownership on a prior date.

The Bankruptcy Rules purport to set a record date based on when
the Clerk of the Bankruptcy Court enters an order on the
official docket; however, these rules in essence require
ownership lists to be prepared retroactively, even though in
many cases this cannot be done accurately.  Accordingly, the
Debtors ask Judge Walsh to exercise his equitable powers under
the Code to set February 18, 2003 - three days in advance of the
hearing on the Disclosure Statement, as the Record Date for

        (a) creditors and equity holders entitled to receive
            Non-Voting Packages, and

        (b) creditors entitled to vote to accept or reject the

Notwithstanding anything to the contrary in the Bankruptcy
Rules.  The Debtors promise to instruct those responsible for
compiling ownership lists to prepare the lists as of February
18, 2003.

The Debtors then describe the contents of the Solicitation
Packages, which will include Ballots, and describe the methods
of transmittal of these Packages to affected parties.  They
request Judge Walsh to put his seal of approval of the forms and
methods of distribution.

                         Assumed Contracts

Finally, the Debtors promise to send the non-debtor parties to
Assumed Contracts the confirmation hearing notice, and if a
monetary default exists, a copy of the Notice of Assumption of
Executory Contracts or Unexpired Leases.  Other parties to
executory contracts and unexpired leases will be able to review
the Plan exhibit to be filed entitled "Schedule of Assumed
Executory Contracts" to see whether their executory contract or
unexpired leases is being assumed or assumed and signed, whether
the Debtors believe there is no existing monetary default, or
whether the executory contract or unexpired lease is being
reject, by either downloading a copy of the Plan or by calling a
toll-free number to request a copy of the Plan.

The Debtors are making copies of all plan-related documents
available at

Any party-in-interest may also call, toll free, (888) 451-0900,
to obtain a copy of any plan-related document.

Agreeing with these proposals, Judge Walsh sets the machinery in
motion by granting this Motion.

SERVICE MERCHANDISE: Gets $9 Million Offer for Headquarters
Service Merchandise has a $9 million offer in hand from Kirkland
Properties LLC for its headquarters facility housing 347,000-
square-foot of space on 28 acres located in Brentwood,
Tennessee.  SMCO is asking the U.S. Bankruptcy Court, subject to
any higher and better offers that may emerge at an April 3
auction, to approve the $9 million sale transaction and pay a
commission to Grubb & Ellis for its marketing efforts.

SIERRA PACIFIC: S&P Rates New $300 Mil. 7.25% Conv. Notes at B-
Standard & Poor's Ratings Services announced that the corporate
credit ratings on utility holding company Sierra Pacific
Resources and those of its utility subsidiaries, Nevada Power
Co. (NP) and Sierra Pacific Power Co. (SPP), are affirmed at
'B+' and removed from CreditWatch with negative implications,
following the successful completion of Sierra Pacific's $300
million, 7.25% convertible notes issue announced on Feb. 11,
2003. The outlook on all ratings is now negative. In addition,
Standard & Poor's assigned the 'B-' rating to the convertible
notes issue, issued as a rule 144A private placement.

Reno, Nev.-based Sierra Pacific has about $3.4 billion in
outstanding debt.

"Sierra Pacific will use the proceeds of the $300 million debt
issue to retire $191 million in outstanding floating rate notes
maturing on April 20, 2003," noted Standard & Poor's credit
analyst Swami Venkataraman. "Another $53 million will be used to
fund a debt service reserve that will be pledged to secure
interest payments on the convertible notes for the next two and
a half years," he continued. The balance of about $55 million
will bolster liquidity at Sierra Pacific.

The 'B+' corporate credit rating reflects the adverse regulatory
environment in Nevada, the substantial operating risk arising
from the dependence on wholesale markets for over 50% of the
utilities' energy requirements, and Sierra Pacific's
substantially weakened financial profile following the
disallowance by the Public Utility Commission of Nevada (PUCN)
of $434 million in deferred power costs incurred by NP during
the 2001 western U.S. power crisis. Key credit concerns include
the PUCN's ruling on NP's pending deferred cost-recovery case,
the outcome of the Enron Corp. lawsuit demanding cash collateral
from NP, and NP's ability to overcome the current restrictions
on its ability to pay dividends to Sierra Pacific. The outcome
of NP's appeal in the Carson City District Court against the
PUCN's March 2002 ruling on its deferred cost-recovery case
could have a positive effect, in the event of a favorable
ruling. No upside potential is factored into the current

The negative outlook for Sierra Pacific reflects the risk of an
adverse ruling, either by the PUCN on NP's deferred cost-
recovery case or by the court on the Enron lawsuit, as well as
the need for Sierra Pacific to address its inability to receive
dividends from NP.

W.R. GRACE: Seeks Three-Year Extension of $250 Million DIP Loan
W.R. Grace & Co. seeks a three-year extension of its $250
million debtor-in-possession loan facility according to
documents filed in the U.S. Bankruptcy Court for the District of
Delaware.  The Company tells Judge Fitzgerald that it needs to
extend the agreement to handle any liquidity contingencies --
including probable calls for large pension plan contributions
and settlements of environmental, tax and other disputes.  Talks
about the details are on-going, W.R. Grace indicates, with the
consortium of DIP lenders led by Bank of America, N.A.

W.R. Grace & Co., based in Columbia, Maryland, filed for chapter
11 protection in April 2001 following an uncontrollable increase
in asbestos personal injury claims.  James H.M. Sprayregen,
Esq., at Kirkland & Ellis, LLP, represents W.R. Grace in its

W.R. GRACE: Proposes 2003-2005 Key Employee Incentive Plan
W.R. Grace & Co. and its debtor affiliates ask Judge Fitzgerald
to authorize -- but not to require -- them to implement the
Grace 2003-2005 Long-Term Incentive Program for certain key
employees as part of a continuing, long-term, performance-based
incentive compensation program.

The Debtors remind Judge Fitzgerald that, as part of the "first-
day" motions, the Debtors asked for and received authority to
continue certain interim compensation programs for key
employees, including the 2001-2003 Long-Term Incentive Plan.
In August 2002, the Court granted the Debtors' Motion seeking to
implement a revised compensation and severance program as part
of these incentive programs.

The ongoing Long-Term Incentive Program contemplates the
implementation of a specific, long-term incentive plan each
year, with payouts based on the performance of the Debtors'
businesses, measured on a three-year performance period
beginning with the year in which the specific plan is
implemented.  To date, the ongoing Long-Term Incentive Program
consists of the 2001-2003 TLIP and the 2002-2004 LTIP.

In accordance with its design and goals regarding motivating key
employees, and the expectations of key employees, the ordinary
administration and implementation of the ongoing LTIP requires
that annual long-term incentive awards be made to key employees
in the ordinary course of the Debtors' business in the form of
an "LTIP".  The 2003-2005 LTIP continues the implementation of
that overall strategy.  Adoption of the 2003-2005 LTIP is
consistent with the ongoing LTIP with respect to its design, and
is also consistent with the 2002-2004 LTIP previously adopted.

           Similarity of 2002-2004 and 2003-2005 LTIP

In all material respects, the provisions of the 2003-2005 LTIP
are identical to the provisions of the 2002-2004 LTIP, which was
authorized and approved by the Court under the revised
compensation order.  Specifically, the 2003-2005 LTIP provisions
are the same as the provisions of the 2002-2004 LTIP in that:

        -- The payments under the 2003-2005 LTIP will consist
           of 100% cash.

        -- Business performance is measured on a 3-year
           performance period, beginning with 2003.

        -- The applicable compound annual 3-year growth
           rate in core earnings before interest and
           taxes to achieve an award of 100% of the 2003-
           2005 LTIP target payment will be 6% per annum.

        -- Partial payouts for EBIT growth rates between
           0% and 6% will be implemented on a straight-line

        -- The amount of the 2003-2005 LTIP target payment
           will be increased at EBIT compound annual growth
           rates in excess of the 6%, up to a maximum of 200%
           of the Base Target Payment at an annual compound
           growth EBIT rate of 25%.

        -- Payouts, if earned, will occur in one-third and
           two-thirds installments, respectively, in March
           following years 2 and 3 of the Plan.

        -- The total target payout for the 2003-2005 LTIP
           will be no more than $12.8 million, which is the
           same total target payout in the 2002-2004 LTIP.

The sole difference between the 2002-2004 LTIP and the 2003-2005
LTIP is the three-year period during which performance is
measured.  Implementation of the ongoing LTIP necessitates a
renewed LTIP be initiated each year, with no more than three
LTIPs in effect in any year.  Thus, upon approval of the Court,
in 2003, the 2001-2003 LTIP, the 2002-2004 LTIP, and the 200-
2005 LTIP will be active.

This Court has recognized that its equity powers include
authorizing the implementation of key employee retention
programs, including long-term incentive plans.  Further, a court
has the statutory authority to authorize a debtor to use
property of the estate under Code section 363 when that use is
an exercise of the debtor's sound business judgment, and when
the use of the property is proposed in good faith.

Generally, courts authorize debtors to implement key employee
incentive programs because key employees are essential to a
debtor's continued operations.  To continue to maintain and
motivate management teams during the chapter 11 process,
particularly in large chapter 11 cases, debtors frequently
implement various combinations of incentive programs of
compensation.  Without such programs, key employees will often
tend to leave a debtor's employ if other employment
opportunities arise offering greater financial rewards without
the incentives inherent in a debtor's reorganization process.
Recognizing these risks, similar employment and incentive plans
have been authorized by this and other courts in such cases as
In re Homelife Corporation (Bankr D. Del. 2001); In re Acme
Metals Incorporated (Bankr. D. Del. 1999); In re FPA Medical
Management, Inc. (Bankr. D. Del. 1998); In re APS Holding Corp.
(Bankr. D. Del. 1998); and in re PWS Holding Corporation,
Brunos, Inc. (Bankr. D. Del. 1998).

The ongoing LTIP was developed in conjunction with Human Capital
Advisor Services Group of Deloitte & Touche at the time that the
Debtors sought approval of the 2002-2004 LTIP.  The 2003-2005
LTIP will have the effect of continuing the ongoing LTIP
developed at that time.

Permitting the Debtors to continue the ongoing LTIP by
implementing the 2003-2005 LTIP will accomplish the sound
business purpose of aiding the maximization of the value of the
Debtors' estates and furthering the Debtors' efforts to
successfully reorganize.  The Key Employees are experienced and
talented individuals who are intimately familiar with the
Debtors' businesses and can easily obtain employment elsewhere.
Furthermore, the Debtors' management believes that, without
continuing the ongoing LTIP, it would be difficult and expensive
to attract and hire qualified replacements for any Key Employee
who does leave the Debtors' employ.

Moreover, such a loss of Key Employees would adversely affect
the Debtors' operations by lowering the morale of the remaining
employees because of the appearance of disarray and disruption
generated by such departures.  It would also burden the Debtors'
remaining employees with additional responsibilities.  All of
these factors would make it more likely that the remaining Key
Employees, too, would explore other employment opportunities.
The loss of even a few Key Employees could therefore potentially
lead to more losses.  Such a scenario would negatively impact
the Debtors' operations.  The Debtors therefore must protect a
critical mass of their high-performing employees in sufficient
numbers to profitably operate their businesses during the
pendency of these chapter 11 cases, thus maximizing the
likelihood of a successful restructuring.

Additionally, given the current status of these chapter 11
cases, the Debtors' management believes that it will be unable
to maintain employee morale and loyalty if it does not continue
the ongoing LTIP by implementing the 2003-2005 LTIP.  The
employees' morale, continued loyalty to the Debtors, and faith
in the Debtors' management will be furthered by the 2003-2005
LTIP because the ongoing LTIP clearly signals the Debtors'
commitment to continuing to profitably grow their businesses for
the benefit of the Debtors' stakeholders, including their
employees.  And, the Debtors need such programs to maximize
their chances of successfully reorganizing.

WEIRTON STEEL: Says Competitiveness Boosted By New Labor Accords
Weirton Steel Corp.'s chief executive officer said the company
has significantly improved its position to compete following
this week's ratification of new labor agreements by its unions.

"We took a big step forward today in boosting our
competitiveness. Although it's painful to ask for sacrifices and
even more so for those affected, I thank the union members for
their courage and management members for understanding that
change is needed for our long-term viability," said John H.
Walker, company president and CEO.

"With all the steel bankruptcies that have occurred, it's better
for our stakeholders that we avoid that fate by implementing
different ways to compete. Faced with receding selling prices
and a weakened economy, we need to move quickly to counter
actions by mills that have restructured, or plan to restructure,
by drastically lowering their costs through means that include
them walking away from their retirees and slashing their
employees' wages and benefits."

The new labor pacts, in addition to similar contributions by
management personnel, include $38 million in annual cost-savings
for Weirton Steel. The company is preparing to address changes
in employee and retiree health care benefits that could result
in additional savings.

"Our employees weathered the steel import crisis and now face
these new challenges. They've never backed down from any threat
to our survival and I don't believe they ever will," Walker

"We're one of just four U.S. integrated steelmakers that have
managed to stay out of bankruptcy and that will continue to be
our goal. It's much easier to control your destiny rather than
have a bankruptcy court judge do it for you. As long as we stay
out of court, the better our chances to succeed and prosper."

The contracts, with the Independent Steelworkers Union and the
Independent Guard Union, include:

      -- a 5 percent pay reduction (includes management);

      -- a pension plan freeze (includes management);

      -- cancellation of a planned dollar-an-hour wage increase
         set for April 1;

      -- instead of receiving 100 percent of vacation pay on
         Feb. 20, half would be paid on that date and the
         remaining half on July 17 -- resulting in an immediate
         savings in liquidity of more than $6 million.

The contract includes 3,200 unionized employees while like
changes affect 530 management personnel. Weirton Steel is the
seventh largest U.S. integrated steel company and produces hot-
rolled, cold-rolled, galvanized and tinplated steel.

* ISYS Search Software Marketed for Bankruptcy Litigation Work
ISYS/Odyssey Development Inc. -- says
its search engine technology was instrumental in helping
bankruptcy litigation counsel at Lionel Sawyer & Collins of Las
Vegas search and retrieve thousands of documents in record time
in preparation for a three-month trial of complex commercial
litigation in Las Vegas. The case involved close to two million
documents produced in discovery and tens of thousands of
documents marked as exhibits for trial.

As a global supplier of search software for businesses and
public sector organizations, ISYS has been deployed by a number
of law firms across the country to help them quickly and easily
search their case documents to locate relevant information.

In this instance, ISYS came to the aid of bankruptcy litigation
specialists at Lionel Sawyer & Collins. ISYS software was used
to help the firm search through massive amounts of emails and
documents produced after the close of discovery in conjunction
with a three-month trial in which the firm defended a group of
financial institutions in complex commercial litigation.

Immediately prior to trial, and well after the close of
discovery, the attorneys at Lionel Sawyer & Collins received
production of thousands of additional documents from the adverse
party. Although the Bankruptcy Court granted Lionel Sawyer's
motion to continue the trial based upon the late production of
these documents, the continued trial date was less than one
month away. This left the professionals at Lionel Sawyer with a
mere two weeks to search through those voluminous documents and
locate relevant information in time to adequately prepare for
the continued trial date.

Lionel Sawyer & Collins was given 100 CDs full of data, which
included a variety of Word documents, Adobe files, emails,
attachments and more. With only three PCs, two paralegals and
ISYS software, the firm searched and retrieved a substantial
amount of evidence in a short timeframe, which in turn helped
the firm overcome tremendous obstacles in preparation for this
mega trial.

"Literally on the eve of trial, we had the overwhelming task of
searching more than 100,000 files for critical evidence that
would support our clients' positions in the case," said Laurel
E. Davis, a Lionel Sawyer & Collins Partner and Bankruptcy

"Not only did we require a search solution that could run
queries across disparate data sources simultaneously, but we
also needed software that could search emails and attachments
that resided among hundreds of Outlook profiles. ISYS proved to
be exactly what we needed and it enabled our paralegals, Christy
Connor and Darin Kirby, to quickly process this data to find a
significant amount of evidence that supported our clients'
position in the case in time for trial."

              About ISYS/Odyssey Development Inc.

Established in 1988, ISYS/Odyssey Development Inc., is a global
supplier of search software for businesses and public sector
organizations. The company's award-winning ISYS product suite
offers comprehensive search solutions designed to meet the
diverse information retrieval and knowledge management needs of
organizations of all sizes.

Headquartered in Sydney, Australia, ISYS/Odyssey Development
also maintains offices in Denver and the UK. The company's
customers include the USDA, Boeing, the California Attorney
General, Perkins Coie and the IRS.  Additional information can
be obtained by phone at 800.992.4797 and via the Web at

*BOOK REVIEW: The Oil Business in Latin America: The Early Years
Author:  John D. Wirth Ed.
Publisher:  Beard Books
Softcover:  282 pages
List price:  $34.95
Review by Gail Owens Hoelscher
Buy a copy for yourself and one for a colleague on-line at

This book grew out of a 1981 meeting of the American Historical
Society. It highlights the origin and evolution of the state-
owned petroleum companies in Argentina, Mexico, Brazil, and

Argentina was the first country ever to nationalize its
petroleum industry, and soon it was the norm worldwide, with the
notable exception of the United States. John Wirth calls this
phenomenon "perhaps in our century the oldest and most
celebrated of confrontations between powerful private entities
and the state."

The book consists of five case studies and a conclusion, as

      * Jersey Standard and the Politics of Latin American Oil
           Production, 1911-30 (Jonathan C. Brown)

      * YPF: The Formative Years of Latin America's Pioneer State
           Oil Company, 1922-39 (Carl E. Solberg)

      * Setting the Brazilian Agenda, 1936-39 (John Wirth)

      * Pemex: The Trajectory of National Oil Policy (Esperanza

      * The Politics of Energy in Venezuela (Edwin Lieuwen)

      * The State Companies: A Public Policy Perspective (Alfred
           H. Saulniers)

The authors assess the conditions at the time they were writing,
and relate them back to the critical formative years for each of
the companies under review. They also examine the four
interconnecting roles of a state-run oil industry and
distinguish them from those of a private company. First, is the
entrepreneurial role of control, management, and exploitation of
a nation's oil resources. Second, is production for the private
industrial sector at attractive prices. Third, is the
integration of plans for military, financial, and development
programs into the overall industrial policy planning process.
Finally, in some countries is the promotion of social
development by subsidizing energy for consumers and by promoting
the government's ideas of social and labor policy and labor

The author's approach is "conceptual and policy oriented rather
than narrative," but they provide a fascinating look at the
politics and development of the region. Mr. Brown provides a
concise history of the early years of the Standard Oil group and
the effects of its 1911 dissolution on its Latin American
operations, as well as power struggles with competitors and
governments that eventually nationalized most of its activities.
Mr. Solberg covers the many years of internal conflict over oil
policy in Argentina and YPF's lack of monopoly control over all
sectors of the oil industry. Mr. Wirth describes the politics
and individuals behind the privatization of Brazil's oil
industry leading to the creation of Petrobras in 1953. Mr. Duran
notes the wrangling between provinces and central government in
the evolution of Pemex, and in other Latin American countries.
Mr. Lieuwin discusses the mixed blessing that oil has proven for
Venezuela., creating a lopsided economy dependent on the ups and
downs of international markets. Mr. Saunders concludes that many
of the then-current problems of the state oil companies were
rooted in their early and checkered histories." Indeed, he says,
"the problems of the past have endured not because the public
petroleum companies behaved like the public enterprises they
are; they have endured because governments, as public owners,
have abdicated their responsibilities to the companies."

Jonh D. Wirth is Gildred Professor of Latin American Studies at
Standford University.


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

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

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

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

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

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


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

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

Copyright 2003.  All rights reserved.  ISSN: 1520-9474.

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

The TCR subscription rate is $675 for 6 months delivered via e-
mail. Additional e-mail subscriptions for members of the same
firm for the term of the initial subscription or balance thereof
are $25 each.  For subscription information, contact Christopher
Beard at 240/629-3300.

                 *** End of Transmission ***