TCR_Public/030414.mbx          T R O U B L E D   C O M P A N Y   R E P O R T E R

              Monday, April 14, 2003, Vol. 7, No. 73

                           Headlines

8X8 INC: Has Until July 7 to Meet Nasdaq Listing Requirements
ADELPHIA BUSINESS: Asks Judge Gerber to Okay Teleport Settlement
ADELPHIA COMMS: Wants More Time to File Schedules and Statements
ADVANCED LIGHTING: Unit Obtains $2.7 Million Funding from DARPA
AIR CANADA: Gets Court's Blessing to Indemnify Directors

AMERICAN MEDIA: Names R.F. Leeds as New Natural Health Publisher
AMERISTAR CASINOS: Appoints Steve Eisner as VP for Development
AQUILA: $630 Million of New Financing Averts Bankruptcy Filing
ARIBA INC: Completes Internal Review of All Accounting Matters
AURORA FOODS: Brings-In Steve Smiley as VP for Purchasing

BORDEN CHEMICALS: BCP Finance Wants Case Converted to Chapter 7
BUDGET GROUP: Committee Brings-In Gibson Dunn as French Counsel
CINEMARK USA: Posts Improved Revenues for Fiscal Year 2002
CLASSIC COMMS: Wants Lease Decision Period Extended Until July 7
COLUMBIA CENTER: Fitch Hatchets $20.2M Class E Note Rating to BB

CONSECO: Gets Court Okay for Herzog Separation & Consulting Pact
COVANTA ENERGY: Earns Nod to Extend and Amend DIP Credit Pact
CREST DARTMOUTH: Fitch Rates $12.25 Million Class D Notes at BB
DDI CORP: Installs New Inspection Technology at San Jose Plant
DIRECTV: Raven America Wants to Transfer Case to Florida Court

DIXIE GROUP: Expects Lower Sales Volume & Higher Costs for Q1
EASYLINK: Fails to Regain Compliance with Nasdaq Requirements
EBIZ ENTERPRISES: Ceases Operations after Asset Foreclosure
ECHOSTAR COMMS: Shareholders' Meeting Scheduled for May 6, 2003
ENRON: EMPI Sues Connectiv Energy for Breach of Contract

FANSTEEL: Seeks to Stretch Lease Decision Period through July 10
FEDERAL-MOGUL: Has Until April 21 to File Disclosure Statement
FLEMING COS.: $76 Million Critical Vendor from Kmart was Wrong
FLEMING COS.: Wants to Honor Open Prepetition Purchase Orders
GENEVA STEEL: Hiring CH2M Hill as Environmental Consultant

GLOBAL CROSSING: Court Approves Settlement Pact with Accenture
GOODYEAR TIRE: S&P Cuts & Plucks B+ Class A-1 Rating from Watch
HAWAIIAN AIRLINES: Wants to Engage Dow Lohnes as Special Counsel
HEALTHSOUTH CORP: Bank Lenders Agree to Forbear Until May 1
HEARTLAND SECURITIES: Committee Taps Cole Schotz as Attorneys

HOLLINGER INC: Dec. 31 Balance Sheet Insolvency Widens to $351MM
HUGHES ELEC.: GM's Ratings Not Affected by Sale of Interests
IMCLONE SYSTEMS: Fails to Satisfy Nasdaq Listing Requirements
INTEGRATED INFO.: Commences Trading on OTCBB Under IISX Symbol
INTERNATIONAL PAPER: Will be Paying Regular Quarterly Dividend

ISLE OF CAPRI: Names Barron Fuller VP & GM of Marquette Casino
J.CREW GROUP: Reports a Slight Decline in Revenues for March
J.CREW: Commences Exchange Offer for Junk-Rated Sr. Debentures
KENNY INDUSTRIAL: Committee Brings-In Arnstein & Lehr as Counsel
KMART CORP: Dist. Ct. Says Critical Vendor Payments Improper

KMART CORP: Appoints Nine Members to New Holding Company Board
LODGENET ENTERTAINMENT: Fiscal Year Net Loss Balloons to $29-Mil
MAGELLAN HEALTH: Employing Ordinary Course Professionals
MAXXIM MEDICAL: Will Padlock Richmond, Virginia Facility
MEDICALCV INC: Consummates $3.8 Million Refinancing Transaction

MIDLAND STEEL: Pepper Hamilton Hired as Committee's Attorneys
MOUNT SINAI-NYU: Fitch Cuts $665M Bond Rating to BB+ from BBB-
NATIONAL STEEL: Has New Bids for Sale of All Principal Assets
NATIONAL STEEL: AK Steel Reaffirms $1.25-Billion Bid for Assets
NATIONAL STEEL: Steelworkers Outraged by AK Steel Proposal

NATIONAL STEEL: U.S. Steel Delivers $975MM Bid to Acquire Assets
NRG ENTERTAINMENT: Commences 1-For-125 Reverse Stock Split
OBSIDIAN ENTERPRISES: Jan. 31 Balance Sheet Upside-Down by $1MM
OWENS CORNING: Restructuring Toledo HQ Lease Obligations
PACIFIC GAS: Makes $75-Mill. Tax Payments to California Counties

PHOTRONICS INC: Prices $125 Million Conv. Sub. Debt Offering
RAINIER: S&P Cuts 4 Class Note Ratings to Low-B & Junk Levels
RELM WIRELESS: Independent Auditors Express Going Concern Doubt
RICA FOODS: Brings-In Stonefield Josephson as New Auditors
RITE AID: March 1 Balance Sheet Insolvency Stands at $112 Mill.

RITE AID: Appoints Mary Sammons as New Chief Executive Officer
ROHN INDUSTRIES: Inks Alliance Agreement with Clark Engineers
SAFETY-KLEEN: Balks at Raygar's $1.4 Million or Billion Claim
SEA CONTAINERS: S&P Ratchets Corporate Credit Rating Down to BB-
SEITEL INC: Noteholders Agree to Extend Standstill Until May 15

SERVICE MERCHANDISE: Court Approves Amended Disclosure Statement
SORRENTO NETWORKS: Net Loss from Q4 Operations Improve 45%
SPIEGEL: Will Continue Using Existing Cash Management System
SPIEGEL GROUP: March Net Sales Dwindle 28% to about $158 Million
TOWER AUTOMOTIVE: Says Funds Sufficient to Maintain Operations

UNITED AIRLINES: Seeks to Extend Section 1110(b) Stipulations
USG CORP: Obtains Additional Time to Move Actions to Del. Court
USG: Says Cash Sufficient to Fund Operations while in Bankruptcy
VON EASTERN: Discontinues CCAC Contract to Restructure Operation
VON EASTERN: Union Lobbies for Province to Provide Added Funding

WARNACO GROUP: Court Confirms Class 5 Claims Distribution
WHITE HALL: Pennsylvania Insurer Placed into Liquidation
WHOLE FOODS: S&P Affirms & Revises BB Rating Outlook to Positive
WORLDCOM INC: Wants to Establish Circuit Rejection Procedures
WYNDHAM INT'L: Appoints Patricia Smith to SVP of Human Resources

* BOND PRICING: For the week of April 14 - 18, 2003

                           *********

8X8 INC: Has Until July 7 to Meet Nasdaq Listing Requirements
-------------------------------------------------------------
8x8, Inc., (Nasdaq: EGHT) announced that Nasdaq has notified 8x8
that it has been granted an additional ninety days, or until
July 7, 2003, to regain compliance with Nasdaq's requirement
that companies listed on the Nasdaq SmallCap Market maintain a
closing bid price equal to or greater than $1.00. In order to
regain compliance with the requirement, the closing bid price of
8x8's common stock must equal or exceed $1.00 for at least ten
consecutive trading days within this ninety day period. Nasdaq's
notice further stated that if 8x8 is unable to regain compliance
with the $1.00 minimum bid price requirement by July 7, 2003,
Nasdaq will notify 8x8 that its common stock will be delisted
from the Nasdaq SmallCap Market. At that time, 8x8 may appeal
that determination to a Nasdaq Listing Qualifications Panel.

During this extension period 8x8 will maintain its listing on
the Nasdaq SmallCap Market and will continue to trade under its
Nasdaq security symbol, EGHT.

8x8, Inc., offers voice and video solutions under the Packet8
brand name -- http://www.packet8.net-- consumer videophones,
hosted iPBX solutions (through its subsidiary Centile, Inc.),
and voice and video semiconductors and related software (through
its subsidiary Netergy Microelectronics, Inc.). For more
information, visit 8x8's Web site at http://www.8x8.com

                          *     *     *

                Liquidity and Capital Resources

In its Form 10-Q for the period ended December 31, 2002, the
Company reported:

"As of December 31, 2002, we had cash and cash equivalents and
short-term investments approximating $6.3 million, representing
a decrease of approximately $2.2 million from September 30,
2002. We currently have no bank borrowing arrangements.

"Cash used in operations of approximately $6.1 million for the
first nine months of fiscal 2003 was primarily attributable to
the net loss of $7.6 million, adjusted for $1.0 million of non-
cash restructuring and other charges and $1.4 million of
depreciation and amortization and net cash used for changes in
operating assets and liabilities of $1.0 million. Cash used in
operations of approximately $6.5 million for the first nine
months of fiscal 2002 was primarily attributable to the net loss
of $6.0 million, adjusted for the non-cash extraordinary gain of
$779,000 and $3.2 million of depreciation and amortization and
net cash used for changes in operating assets and liabilities of
$2.8 million. Our negative operating cash flows primarily
reflect our net losses resulting from the same factors affecting
our revenues and expenses as described above.

"Cash used in investing activities in the nine months ended
December 31, 2002 was attributable to net purchases of
marketable equity securities of $178,000 and capital
expenditures of $130,000, partially offset by proceeds from the
sale of equipment of $40,000. Cash provided by investing
activities in the nine months ended December 31, 2001 is
attributable to proceeds from the sale of an investment in
marketable equity securities of $543,000 and proceeds from the
sale of equipment of $116,000, partially offset by capital
expenditures of $158,000.

"Cash provided by financing activities during the first nine
months of fiscal 2003 consisted primarily of proceeds resulting
from the sale of common stock to employees through our employee
stock purchase and stock option plans. Cash used in financing
activities during the first three quarters of fiscal 2002
consisted of the $4.5 million payment associated with the
redemption of the convertible subordinated debentures and
certain costs incurred in connection with the redemption, offset
partially by proceeds resulting from the sale of our common
stock to employees through our employee stock purchase and stock
option plans

"As of December 31, 2002, our principal commitments consisted of
obligations outstanding under noncancelable operating leases.

"As noted previously, we redeemed our convertible subordinated
debentures in December 2001. The consideration included the
issuance of 1,000,000 shares of our common stock to the lenders.
We have committed to maintaining the effectiveness of the
registration statement filed with the Securities and Exchange
Commission covering the resale of these shares. Should we fail
to maintain the effectiveness of the registration statement, we
may be required to pay cash penalties and redeem all or a
portion of the shares at the higher of $0.898 or the market
price of our common stock at the time of the redemption which
could have a material adverse effect on our cash flows and
results of operations. The value of the shares still held by the
lenders of $678,000 at December 31, 2002, based upon the $0.898
per share minimum potential redemption price, is reflected as
contingently redeemable common stock in the condensed
consolidated balance sheet.

"Based upon our current expectations, we believe that our
current cash and cash equivalents and short-term investments,
together with cash generated from operations, will satisfy our
expected working capital and capital expenditure requirements
through at least June 30, 2003. However, we believe we will need
additional working capital to fund operations shortly
thereafter. The possibility that we will not be able to meet our
obligations as and when they become due over the next twelve
months raises substantial doubt about our ability to continue as
a going concern. Accordingly, we have been pursuing, and will
continue to pursue, the implementation of certain cost reduction
strategies. Additionally, we plan to seek additional financing
and evaluate financing alternatives during the next twelve
months in order to meet our cash requirements for fiscal 2004.
We may also seek to explore business opportunities, including
acquiring or investing in complementary businesses or products
that will require additional capital from equity or debt
sources. Additionally, the development and marketing of new
products could require a significant commitment of resources,
which could in turn require us to obtain additional financing
earlier than otherwise expected. We may not be able to obtain
additional financing as needed on acceptable terms, or at all,
which may require us to reduce our operating costs and other
expenditures, including reductions of personnel and suspension
of salary increases and capital expenditures. Alternatively, or
in addition to such potential measures, we may elect to
implement other cost reduction actions as we may determine are
necessary and in our best interests, including the possible sale
or cessation of certain of our business segments. Any such
actions undertaken might limit our opportunities to realize
plans for revenue growth and we might not be able to reduce our
costs in amounts sufficient to achieve break-even or profitable
operations. If we issue additional equity or convertible debt
securities to raise funds, the ownership percentage of our
existing stockholders would be reduced and they may experience
significant dilution. New investors may demand rights,
preferences or privileges senior to those of existing holders of
our common stock. If we are not successful in these actions, we
may be forced to cease operations."


ADELPHIA BUSINESS: Asks Judge Gerber to Okay Teleport Settlement
----------------------------------------------------------------
Adelphia Business Long Haul asks Judge Gerber to approve their
settlement agreement with Digital Teleport, Inc.

According to Judy G.Z. Liu, Esq., at Weil Gotshal & Manges LLP,
in New York, ABIZ Long Haul and Digital Teleport are parties to
a certain Indefeasible Right of Use and Telecommunications
Services Agreement regarding, among other things, the granting
by Digital Teleport to ABIZ Long Haul of an IRU in certain dark
fiber strands in Digital Teleport's fiber optic communication
transmission facilities, together with collocation spaces along
these routes.

Certain disputes have arisen between ABIZ Long Haul and Digital
Teleport in connection with the IRU Agreement.  Specifically,
each party contends that the other party has not complied with
the IRU Agreement.  As a result, ABIZ Long Haul has filed a
proof of claim for $3,000,000 in Digital Teleport's Chapter 11
case and Digital Teleport has filed a proof of claim for
$4,000,000 in ABIZ Long Haul's Chapter 11 case.  Moreover,
Digital Teleport alleges that its $4,000,000 proof of claim
includes a set-off of Long Haul's $3,000,000 proof of claim.
The parties now want to settle all claims between them relating
to the IRU Agreement.

The salient terms of the Settlement Agreement are:

     A. Rejection of IRU Agreement: Digital Teleport and ABIZ
        Long Haul will both reject the IRU Agreement in their
        Chapter 11 cases.

     B. Withdrawal of Claims and Dismissal of Actions by ABIZ
        Long Haul:  After the closing of the Settlement
        Agreement, ABIZ Long Haul will dismiss any actions it may
        have against Digital Teleport, withdraw its proof of
        claim in the Digital Teleport Chapter 11 case and waive
        any administrative claim it may have against Digital
        Teleport.

     C. Withdrawal of Claims and Dismissal of Actions by Digital
        Teleport: After the closing of the Settlement Agreement,
        Digital Teleport will dismiss any actions it may have
        against ABIZ Long Haul, withdraw its proof of claim in
        the ABIZ Long Haul Chapter 11 case and waive any
        administrative claim it may have against ABIZ Long Haul.

     D. Purchase of Lamda Services: ABIZ Long Haul will purchase
        Lamda services from Digital Teleport pursuant to the
        terms and conditions set forth on the Lamda Service Order
        and Lamda Service Order Terms and Conditions.  In
        connection with the Lamda Service Order, the Debtors will
        pay to Digital Teleport a $400,000 initial payment and
        $250,000 subsequent payments for each of the two
        remaining years for the Lamda Service Order.

     E. Disputes: Digital Teleport and ABIZ Long Haul will settle
        all disputes between themselves.

     F. Release of Claims: Digital Teleport and ABIZ Long Haul
        will release all claims between themselves.

ABIZ Long Haul believes that the terms of the Settlement
Agreement are fair and equitable, and fall well within the range
of reasonableness.  Ms. Liu tells the Court that it is the
product of hard-fought, arm's-length negotiations on both sides
and approval of the Settlement Agreement is in the paramount
interests of ABIZ Long Haul's creditors.  Through the Settlement
Agreement, the parties have avoided the uncertainties attendant
to potentially complex and protracted litigation with respect to
the disputes, which may have arisen from the IRU Agreement.  The
Settlement Agreement also provides for the purchase of certain
high capacity circuits, known as Lamda Services, which ABIZ Long
Haul requires in order to connect certain of its markets to its
overall backbone network.  Ms. Liu points out that the
Settlement Agreement allows ABIZ Long Haul to purchase these
services at a competitive purchase price.  In addition, the
Settlement Agreement obviates the need for ABIZ Long Haul and
Digital Teleport to file duplicative motions to reject the IRU
Agreement in their Chapter 11 cases and prevents the possible
disputes that could arise from the dual rejections.  Experienced
counsel for each of the parties expended a great deal of time
and effort in reaching a resolution.  By avoiding this potential
litigation and entering into the proposed settlement, ABIZ Long
Haul's estate will maximize value for its creditors, and proceed
with its Chapter 11 case without the distraction of a prolonged
and costly litigation with Digital Teleport. (Adelphia
Bankruptcy News, Issue No. 32; Bankruptcy Creditors' Service,
Inc., 609/392-0900)


ADELPHIA COMMS: Wants More Time to File Schedules and Statements
----------------------------------------------------------------
Adelphia Communications and its debtor-affiliates ask the Court
to further extend the time within which they are required to
file their creditor list, list of equity security holders, and
schedules and statements of financial affairs for an additional
120 days through August 1, 2003.

Marc Abrams, Esq., at Willkie Farr & Gallagher, in New York,
tells the Court that the ACOM Debtors have expended substantial
efforts responding to the many exigencies and other matters that
are incident to any Chapter 11 case but which are compounded in
a case of this size and complexity.  Since December 20, 2002,
the date the ACOM Debtors' previous extension was granted, the
Debtors have been actively engaged in numerous tasks incident to
the Chapter 11 process and the operation of their businesses,
including:

     A. following a lengthy period of negotiating and careful and
        deliberate consideration by ACOM's Board of Directors,
        executed employment agreements with William Schleyer to
        serve as Chairman of the Board and ACOM's Chief Executive
        Officer and Ronald Cooper to serve as ACOM's President
        and Chief Operating Officer, and filed a motion seeking
        authority to enter into these agreements.  The Debtors
        were confronted with extensive litigation with the Equity
        Committee regarding these agreements, including a four-
        day evidentiary hearing.  The Court issued a written
        decision approving the hiring of Messrs. Schleyer and
        Cooper;

     B. commenced a dialogue with the Committees and governmental
        units involving the implementation of a governance
        protocol designed to reconstitute the Board through the
        selection of new, independent directors;

     C. continued their migration efforts from Adelphia Business
        Solutions and the claims reconciliation process attendant
        thereto, including the filing of a request to conduct a
        2004 examination seeking the production of documents and
        obtaining approval of a joint rejection procedure for
        executory contracts and unexpired leases, which has since
        been withdrawn;

     D. obtained approval of certain amendments and waivers in
        connection with their $1,500,000,000 debtor-in-possession
        financing facility;

     E. obtained approval of the terms of postpetition financing
        for Niagara Frontier Hockey, L.P. and general authority
        to negotiate a sale of these entities' operating assets;

     F. continued to analyze their executory contracts and leases
        to determine whether these agreements should be assumed
        or rejected by the various estates, and obtained a court
        order rejecting leases and agreements;

     G. continued to analyze the disposition of non-core assets;

     H. continued cooperation with the SEC and the Department of
        Justice in connection with their ongoing investigations
        and proceedings;

     I. worked closely with the Committees and senior secured
        lenders and their professionals to keep all parties fully
        informed of the Debtors' finances and efforts to
        formulate a business plan.  Throughout the postpetition
        period, the Constituents' professionals have been given
        access to the Debtors' senior management.  The
        Constituents' advisors have also had open access to
        Debtors' counsel and other advisors.  In addition, the
        Constituents have directly participated in meetings with
        the Debtors and their professionals.  The Debtors
        anticipate that this open exchange among the Debtors and
        the Constituents will continue;

     J. engaged in discussions with local franchise authorities
        in an effort to resolve issues relating to:

          (i) alleged prepetition defaults under franchise
              agreements;

         (ii) monetary and performance upgrade obligations
              required under the agreements;

        (iii) the continued provision of uninterrupted service to
              their customers; and

         (iv) the renewal or extension of numerous franchises.

        The Debtors are party to 3,000 franchise agreements with
        various municipalities.  During the past several months,
        the Debtors spent a considerable amount of time
        responding to certain LFAs' motion in support of the
        formation of an official franchise committee and seeking
        relief in connection with the denial of three New
        Hampshire franchises.  In addition, the Debtors are
        continuing to compile a database of all of their
        nationwide franchise obligations; and

     K. commenced litigation against their former auditors,
        Deloitte & Touche.

Mr. Abrams adds that a team of the Debtors' employees is
performing a complete internal review of the Debtors' books and
records in connection with the re-audit of the Debtors' books
and records and restatement of their financial statements.  They
are also compiling the information necessary to prepare the
Schedules and Lists.  These assignments are extremely time-
consuming, not only due to the sheer size of the Debtors'
operations, but also because of the unique circumstances that
led up to the filing of these cases.  While the Debtors are
tackling both tasks simultaneously, much of the information
simply will not be available until the re-audit process is
completed.  Accordingly, while the Debtors have taken steps
towards compiling their Schedules and Lists, the review process
and the completion of the Schedules and Lists will take at least
a few additional months to complete.  The Debtors submit that
they have "cause" to further extend the time to file the
Schedules and the Lists in view of the facts and circumstances
of these cases. (Adelphia Bankruptcy News, Issue No. 32;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


ADVANCED LIGHTING: Unit Obtains $2.7 Million Funding from DARPA
---------------------------------------------------------------
Advanced Lighting Technologies, Inc., (OTCBB:ADLTQ) announced
that APL Engineered Materials, Inc., a wholly owned subsidiary
of Advanced Lighting Technologies, Inc., has been awarded $2.7
million in funding over the next three years, from DARPA through
the Army Aviation and Missile Command to develop a new arc
discharge light source for its High Efficiency Distributed
Lighting project.

DARPA, the Defense Advanced Research Projects Agency, selected
APL Engineered Materials and its technology partners as the
developers and suppliers for new key technologies in high-
efficiency, full-spectrum quartz metal halide light sources for
next generation lighting in ships and other military
applications.

APL Engineered Materials, the world's leading supplier of
materials for high-intensity discharge lamp applications, has
extensive capabilities in lamp materials fabrication and
characterization. APL will apply its expertise in these areas to
the problems inherent in making a low-wattage light source of
high efficiency and brightness with a uniform spectral output.
The technology developed under this effort will enhance and
expand the use of QMH light sources for use in the HEDLight
applications and for use in energy-efficient commercial lighting
applications worldwide. ADLT's Venture Lighting International,
Inc. division will be supplying equipment and design expertise
to APL Engineered Materials.

APL has teamed with Fiberstars, Inc., the world's largest fiber
optic lighting company, and Venture Lighting International,
another Advanced Lighting company, on the HEDLight project.
Fiberstars will serve as technical advisors and consultants to
APL in the development of this next generation light source.
Fiberstars has recently announced the award of DARPA/AMCOM
funding for work on the optics, luminaire and integrated
illuminator technology components of the "HEDLight" program.
Together, the total funding involving APL Engineered Materials,
Fiberstars, Advanced Lighting Technologies and partner companies
totals $9.5 million.

Advanced Lighting Technologies CEO Wayne Hellman noted, "APL's
participation is expected to supply key new technologies in
light sources for high-efficiency distributed lighting. The
results of the DoD-funded effort should enhance the existing
commercial portfolios of both Advanced Lighting Technologies and
its technology partners, providing a path for future growth of
the successful technology in the commercial marketplace. The DoD
will obtain better technology in the future by working with APL,
Advanced Lighting Technologies and Fiberstars. We welcome the
opportunity of working with DARPA and our partner companies on
this exciting project. I congratulate Dr. Timothy R. Brumleve,
APL Vice President of Technology, and his team for the fine job
they did in submitting these successful proposals to DARPA."

Advanced Lighting Technologies, Inc., is an innovation-driven
designer, manufacturer and marketer of metal halide lighting
products, including materials, system components, systems and
equipment. The Company also develops, manufactures and markets
passive optical telecommunications devices, components and
equipment based on the optical coating technology of its wholly
owned subsidiary, Deposition Sciences, Inc.

Advanced Lighting filed for Chapter 11 protection on February 5,
2003 (Bankr. N.D. Ill. Bankr. Case No. 03-05256). Jerry L.
Swizter, Jr., Esq., at Jenner & Block LLC, represents the
Debtor.  The Company's Dec. 31, 2002, balance sheet shows assets
totaling $184,939,000.  The Company has a debtor-in-possession
credit facility with several financial institutions in place.
The DIP Facility matures on July 30, 2003.  As part of the
bankruptcy process, the Company hopes to refinance its DIP
Facility and pursue restructuring with its noteholders and
equity holders. The DIP Facility requires the Debtor to begin a
process to sell assets sufficient to satisfy indebtedness to the
Banks if no refinancing can be accomplished by March 30, 2003.


AIR CANADA: Gets Court's Blessing to Indemnify Directors
--------------------------------------------------------
At Air Canada and its affiliated CCAA applicants' behest, Mr.
Justice Farley approves in his Initial Order Air Canada's
request to indemnify its directors for all non-criminal claims
of any kind that may not be covered by existing directors and
officers liability insurance where the director acted honestly
and in good faith.

This Directors' Charge is subject to a C$170,000,000 cap and
takes a third and fifth-priority in the CCAA Proceedings.
Specifically, in the event of a melt-down, subject to liens
valid, enforceable and perfected prior to April 1, 2003, the
proceeds of a liquidation of the Applicants' property will be
distributed:

       * First, to professionals for fees covered by the
         Administrative Charge (with GE Captial's consent), up to
         a maximum of C$10,000,000;

       * Second, to GE Capital Canada, up to a maximum of
         US$700,000,000;

       * Third, up to C$70,000,000 on account of the Directors'
         Charge;

       * Fourth, any claims on account of the Administrative
         Charge exceeding C$10,000,000; and

       * Fifth, any claims on account of the Directors' Charge,
         exceeding C$70,000,000 and subject to a C$100,000,000
         cap. (Air Canada Bankruptcy News, Issue No. 2;
         Bankruptcy Creditors' Service, Inc., 609/392-0900)

Air Canada's 10.250% bonds due 2011 (AC11CAR1) are presently
trading at 24 and 28. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=AC11CAR1for
real-time bond pricing.


AMERICAN MEDIA: Names R.F. Leeds as New Natural Health Publisher
----------------------------------------------------------------
Carolyn Bekkedahl, Executive Vice President of American Media,
Inc., and Publishing Director of the Weider Active Lifestyle
Group, named Randy Frank Leeds as the new publisher of Natural
Health magazine.

"Randy has been successfully selling the active lifestyle and
wellness market for over six years," Ms. Bekkedahl said. "In
addition, she also has a unique background that is well suited
for the plans we have for Natural Health. An entrepreneur who
has owned her own marketing company, Randy has also worked in
television and cable, and has experience in international
syndication ventures -- all areas of expertise that will come in
handy as we re-launch and market Natural Health."

Ms. Leeds added, "I fell in love with the magazine the minute
Carolyn showed me the redesign done by Roger Black. The new
Natural Health will have a very distinct personality that both
readers and advertisers will find refreshing and engaging."

Commenting on the appointment, American Media Chairman, David J.
Pecker said, "We are making a multi-million dollar investment in
Natural Health and choosing the right person to be the publisher
is critical. We are very fortunate to now have Randy as part of
our team."

Ms. Leeds had been with Fitness magazine since 1996, most
recently as Associate Publisher. Prior to Fitness, she had
managed her own company, Frank Marketing Inc., and worked
extensively in the cable TV industry.

The titles in the Weider Active Lifestyle Group are Shape, Fit
Pregnancy and Natural Health, and represent the leading
publications in the women's active lifestyle, pre- & postnatal
fitness and self-care categories. These titles have a readership
in excess of 9 million.

American Media, Inc., is one of the largest media companies in
the U.S. The company publishes six of the 14 best selling weekly
magazines, including the no.2 and no.4 titles, the National
Enquirer and Star. AMI recently acquired Weider Publications,
the leading publisher of health and fitness magazines, including
Shape, Men's Fitness, Muscle & Fitness, Muscle & Fitness Hers,
Flex, Fit Pregnancy and Natural Health. The company also
publishes the best selling country music magazines, Country
Weekly and Country Music; a Latino entertainment magazine,
Mira!; two automotive magazines, AMI's Auto World and NOPI
Street Performance Compact; and more than 200 Mini-Mags and
Digests. AMI recently launched its own book division with seven
titles released to date. In addition to print properties, AMI
owns Distribution Services, Inc., the country's no.1 in-store
magazine merchandising company.

As reported in Troubled Company Reporter's January 9, 2003
edition, Standard & Poor's affirmed its 'B+' corporate credit
rating for publisher American Media Operations Inc., following
the company's pending acquisition of Weider Publications LLC for
$350 million.

In addition, Standard & Poor's assigned its 'B+' senior secured
rating to American Media Operations Inc.'s $140 million tranche
C-1 term loan, and 'B-' rating to the company's $150 million
subordinated notes due 2011. The Boca Raton, Florida-based
company has pro forma total debt of $1.02 billion as of
September 23, 2002. The outlook is stable.

"Standard & Poor's expects that the transaction, while largely
debt-financed, will not materially alter credit measures over
the near term due to potential operating synergies and cost-
saving opportunities through the leveraging of American Media's
existing infrastructure," said Standard & Poor's credit analyst
Hal Diamond.


AMERISTAR CASINOS: Appoints Steve Eisner as VP for Development
--------------------------------------------------------------
Ameristar Casinos, Inc., (Nasdaq: ASCA) announced that Steve
Eisner has been named Vice President of Development.  The
company also announced it has hired Greg Cooper as Vice
President of Legal Affairs.

In his new position, Eisner will focus on pursuing domestic and
international development opportunities to expand and diversify
the Company's portfolio of properties.  He will also assist on
governmental affairs, which will enhance the Company's depth in
this critical area.  He will continue to be based at Ameristar's
office in Encino, Calif.

Eisner joined Ameristar in 1999 as Vice President of Legal
Affairs.  Since that time, he has played a substantial role in
the Company's debt and equity financing transactions; assisted
in completing Ameristar's acquisition of the Missouri properties
and their integration into the Company's operations; and
supported Ameristar's construction and development groups,
including providing legal support for the Company's development
and construction of the new Ameristar Casino St. Charles.
During his tenure with Ameristar, Eisner has also been
responsible for negotiating a variety of real estate
transactions, SEC reporting and compliance, and providing legal
support for the Company's Finance Department.

Eisner began his career with O'Melveny & Myers LLP in Los
Angeles, where he handled a variety of corporate transactions,
including mergers and acquisitions, securities offerings, bank
financings, joint ventures and corporate start-ups.  Eisner
earned a Bachelor of Arts degree in Economics from The
University of California, Berkeley, with high honors, and a
Juris Doctorate from The University of California, Los Angeles
School of Law.

"The transition to Vice President of Development will be a
natural one for Steve," said Gordon R. Kanofsky, Ameristar's
Executive Vice President.  "He has been involved with many
development opportunities at Ameristar and has strong analytical
and negotiating skills.  His background in transactional law
will also serve him well as we evaluate and pursue potential new
opportunities to grow our company."

As Vice President of Legal Affairs, Cooper will assume many of
Eisner's prior responsibilities.  These include providing legal
support on real estate and construction contracts, financing
transactions, SEC reporting and compliance, employee benefit
plans and ERISA matters.  Cooper joins Ameristar from Los
Angeles, after practicing law at two top-tier national law
firms: Akin, Gump, Strauss, Hauer & Feld; and Sullivan &
Cromwell.  His background includes general corporate and
transactional law, securities offerings and mergers and
acquisitions.  He also served as a law clerk in the 9th Circuit
Court of Appeals.

Cooper earned a Bachelor of Arts degree in Politics from
Princeton University, with summa cum laude honors.  He holds a
Juris Doctorate from Yale Law School; while at Yale he was lead
article editor for the Yale Journal on Regulation.  Cooper will
be located at Ameristar's Corporate office in Las Vegas.

Peter C. Walsh, Ameristar's Senior Vice President and General
Counsel, noted:  "We are very pleased to have Greg join our
department.  His experience as a transactional attorney,
combined with his stellar educational and professional
credentials, will be valuable assets to our Corporate legal
team."

Ameristar Casinos, Inc. (Nasdaq: ASCA) -- whose 10-3/4% Notes
due Feb. 2009 are rated B3 by Moody's and at B by Standard &
Poor's -- is an innovative, Las Vegas-based gaming and
entertainment company known for its distinctive, quality
conscious hotel-casinos and value orientation.  Led by President
and Chief Executive Officer Craig H. Neilsen, the organization's
roots go back nearly five decades to a tiny roadside casino in
the high plateau country that borders Idaho and Nevada. Publicly
held since November 1993, the corporation owns and operates six
properties in Nevada, Missouri, Iowa and Mississippi, two of
which carry the prestigious American Automobile Association's
Four Diamond designation. Ameristar's Common Stock is traded on
the NASDAQ National Market System under the symbol: ASCA.

Visit the Company's Web site at http://www.ameristarcasinos.com


AQUILA: $630 Million of New Financing Averts Bankruptcy Filing
--------------------------------------------------------------
Aquila, Inc. (NYSE: ILA) completed a new financing agreement
Friday that replaces its short-term credit facilities.  The
package consists of two secured loan facilities:

      * a one-year $200 million loan to UtiliCorp Australia, Inc.
        and

      * a $430 million three-year term loan to Aquila.

The initial amount drawn under the one-year loan will be $100
million, and the company will have an option to draw another
$100 million within the next 30 days. The one-year loan is non-
recourse to Aquila, Inc.

"Completing this financing package is a key component of the
overall plan we've been pursuing to achieve financial stability
and return Aquila to its regulated utility roots," said Rick
Dobson, Aquila's interim chief financial officer. "We clearly
have more work ahead, but with this financing in place, plus our
existing cash and cash flow from operations, the company should
have sufficient liquidity to execute the remainder of its
restructuring plan."

Proceeds from the loan package will be used to terminate the
company's existing 364-day senior bank facility, repay synthetic
leases associated with two power plants in Illinois, and cash
collateralized outstanding letters of credit. Initial interest
rates on the loans are 7 percent for the one-year loan and 8.75
percent for the three-year term loan.

                   These Are Secured Loans

Collateral for the one-year loan includes the company's
interests in its Australian investments, interests in its
portfolio of U.S.-based independent power plants and two
nonregulated power plants in Illinois.

Collateral for the three-year term loan will include a
combination of the company's non-regulated and regulated utility
assets. Later this month Aquila will initiate regulatory
proceedings to secure the three-year loan with additional U.S.-
based regulated utility assets. Upon regulatory approval, the
interest rate on the three-year loan will be reduced to 8.00
percent.

Credit Suisse First Boston served as the sole arranger for the
new loans. Additional details on the refinancing will be
discussed when Aquila reviews its 2002 fourth quarter and year-
end results during a webcast scheduled for April 15 at 9 a.m.
Eastern.

Through the first nine months of 2002, Aquila reported a net
loss of $1.075 billion and the company indicates it incurred
additional losses in the fourth quarter of 2002.  Year-end
results will be released tomorrow, April 15.

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



ARIBA INC: Completes Internal Review of All Accounting Matters
--------------------------------------------------------------
Ariba, Inc. (Nasdaq: ARBAE), the leading Enterprise Spend
Management solutions provider, announced that the company's
internal review of certain accounting matters is complete and
the company's annual report on Form 10-K for the fiscal year
ended September 30, 2002 and quarterly report on Form 10-Q for
the quarter ended December 31, 2002 have been filed with the
Securities and Exchange Commission. As a result of this review,
Ariba has restated its financial statements for the fiscal years
ended September 30, 2000 and 2001, and for the quarters ended
December 31, 1999 through June 30, 2002. The company has also
adjusted the preliminary financial statement information for the
quarter and fiscal year ended September 30, 2002 (announced on
October 23, 2002) and for the quarter ended December 31, 2002
(announced on January 23, 2003).

More information is available in the updated periodic reports
that have been filed with the SEC on Forms 10-K and 10-Q. The
company has been in communication with Nasdaq and expects to be
in compliance with its continued listing requirements upon
filing its Forms 10-Q/A for the quarters ended March 31 and
June 30, 2002.

The net effect of all the accounting adjustments is to increase
the company's net loss by $9.8 million in fiscal year 2000 and
$14.1 million in fiscal year 2001, decrease the net loss by
$22.1 million in fiscal year 2002, and increase the net loss by
$2.0 million in the first quarter of fiscal year 2003. The
cumulative net effect of the adjustments is to increase the
company's accumulated deficit at December 31, 2002 by $3.8
million to $4.24 billion. None of these adjustments has any
impact on the company's cash balances for any period.

           Details of the Review and Restated Items

As previously announced, the review initially focused on a $10.0
million payment in March 2001 from Keith Krach, the company's
chairman and co-founder to Larry Mueller, the company's
president and chief operating officer at the time, and Mr.
Krach's payment of $1.2 million for chartered air services
provided to Mr. Mueller over the period from September 2000
through July 2001. Because no company funds were used in these
transactions and there was no commitment to or from Ariba, the
company originally viewed these payments as personal. Ariba has
now concluded that, for accounting purposes, the company should
treat these transactions as if they were capital contributions
from Mr. Krach, which were then expensed by Ariba as
compensation to Mr. Mueller. Accordingly, the company's restated
consolidated financial statements for the fiscal years ended
September 30, 2000 and 2001 reflect non-cash charges to
operating expenses in connection with these transactions.

Also as previously announced, the company reviewed its
accounting for stock options issued by companies that Ariba
acquired in fiscal year 2000. The company determined that
certain stock options granted by these acquired companies to a
limited number of individuals shortly before those acquisitions
should be accounted for as stock-based compensation expense,
rather than be included as part of the purchase price of these
companies and amortized as goodwill. As a result, the company's
restated consolidated financial statements for fiscal years 2000
and 2001 and the company's consolidated financial statements for
fiscal year 2002 reflect an increase in non-cash stock-based
compensation expense and a reduction of goodwill amortization
expense. Ariba further determined that the fair value of certain
unvested stock options granted by one of these companies to
several consultants was not included in the measurement of stock
compensation expense as required. The cumulative effect of these
adjustments is a non-cash charge of $10.1 million, consisting of
increases to the company's operating expenses for fiscal years
2000 and 2001 of $13.5 million and $10.5 million, respectively,
and decreases for fiscal year 2002 and the first quarter of
fiscal year 2003 of $13.1 million and $777,000, respectively.

Ariba also reviewed its accounting policies and their
application to various additional items and identified a number
of transactions in which the company's accounting policies had
not been consistently or appropriately applied. The company has
included the adjustments described below for these items in the
company's restated financial statements.

Ariba identified three license arrangements that it entered into
with vendors during fiscal years 2000 and 2001 at or about the
same time the company incurred obligations to purchase goods or
services from those vendors. Ariba has concluded that it should
record expenditures associated with these obligations as
reductions of license revenues received from the customer. The
effect of these adjustments, while not affecting net loss in any
year, is to decrease revenues by $583,000, $8.2 million and
$275,000 in fiscal years 2000, 2001 and 2002, respectively. The
company also determined that the timing of revenue recognition
for several license arrangements should be adjusted between
periods, which results in the acceleration of revenue in certain
cases and the deferral of revenue in others. The net effect of
these adjustments is to decrease revenues by $995,000 in fiscal
year 2000 and to increase revenues by $6.4 million and $883,000
million in fiscal years 2001 and 2002, respectively. As a result
of all of these revenue adjustments, the company's revenues
decreased by $1.6 million and $1.8 million in fiscal years 2000
and 2001, respectively, increased by $608,000 in fiscal year
2002, and decreased by $311,000 in the first quarter of fiscal
year 2003.

In addition, the company identified several accrued expense
items for which Ariba concluded that the amount of the
liability, the initial timing of recording the liability, or the
timing of releasing the liability should be adjusted. These
items include accruals for payroll taxes, royalties payable,
litigation, bonuses and benefits, and income taxes. These
accrued expense adjustments, together with expense reductions
resulting from the revenue adjustments described above, caused
operating expenses to decrease by $5.3 million in fiscal year
2000, $10.8 million in fiscal year 2001, $6.0 million in fiscal
year 2002 and $221,000 for the first quarter of fiscal year
2003. In addition, the provision for income taxes increased by
$1.4 million in fiscal year 2001, decreased by $2.4 million in
fiscal year 2002, and increased by $2.7 million for the first
quarter of fiscal year 2003. These adjustments include a
subsequent event relating to a tax claim resolved in fiscal year
2003 that reduced expenses in fiscal year 2002 and increased
expenses in the quarter ended December 31, 2002 by $2.7 million
compared to previously announced preliminary results for those
periods.

                  Update to Expense Guidance
             for the Quarter Ended March 31, 2003

Due to the unexpected length and breadth of the review process,
the company has incurred higher-than-anticipated operating
expenses during its second quarter of fiscal 2003 (ended
March 31, 2003). As a result, Ariba now anticipates that
operating expenses will be roughly $5 million higher than the
previous guidance provided for the quarter, thereby increasing
the company's net loss by approximately $0.02 per share. Ariba
expects to announce its second quarter results after the close
of the market on April 28, 2003.

Ariba, Inc., is the leading Enterprise Spend Management (ESM)
solutions provider. Ariba helps companies develop and leverage
spend management as a core competency to drive significant
bottom line results. Ariba Spend Management software and
services allow companies to align their organizations with a
spend-centric focus and deploy closed-loop processes for
increased efficiencies and sustainable savings. Visit
http://www.ariba.comfor more information on the Company.

                          *     *     *

                  Liquidity and Capital Resources

In its report for the period ended June 30, 2002, filed with the
Securities and Exchange Commission, the Company stated:

"As of June 30, 2002, we had $167.6 million in cash, cash
equivalents and short-term investments, $80.2 million in long-
term investments and $30.6 million in restricted cash, for total
cash and investments of $278.4 million and ($1.4 million) in
working capital. As of September 30, 2001, we had $217.9 million
in cash, cash equivalents and short-term investments, $43.1
million in long-term investments and $32.6 million in restricted
cash, for total cash and investments of $293.6 million and $57.6
million in working capital. Our working capital declined $59.0
million from September 30, 2001 to June 30, 2002, reflecting a
reduction of current assets by $90.8 million (of which $37.1
million related to transfers of investments to non-current
investments due to longer maturities) and a $31.9 million
reduction of current liabilities.

"Net cash used in operating activities was approximately $19.0
million for the nine months ended June 30, 2002, compared to
$17.6 million of net cash provided by operating activities for
the nine months ended June 30, 2001. Net cash used in operating
activities for the nine months ended June 30, 2002 is primarily
attributable to decreases in accounts payable, accrued
compensation and related liabilities, accrued liabilities and
deferred revenue, and to a lesser extent, the net loss for the
period (less non-cash expenses). These cash flows used in
operating activities were partially offset by decreases in
accounts receivable and, to a lesser extent, prepaid expenses
and other assets.

"Net cash provided by investing activities was approximately
$42.8 million for the nine months ended June 30, 2002 compared
to $135.6 million of net cash used in investing activities for
the nine months ended June 30, 2001. Net cash provided by
investing activities for the nine months ended June 30, 2002 is
primarily attributable to the redemption of our investments
partially offset by the purchases of property and equipment.
Although the recent restructuring of our operations will reduce
our capital expenditures over the near term, these expenditures
may increase over the longer term.

"Net cash provided by financing activities was approximately
$8.1 million for the nine months ended June 30, 2002 compared to
$80.5 million of net cash provided by financing activities for
the nine months ended June 30, 2001. Net cash provided by
financing activities for the nine months ended June 30, 2002 is
primarily from the proceeds from the exercise of stock options
offset by the repurchase of our common stock and payment of
capital lease obligations.

"In March 2000, we entered into a new facility lease agreement
for approximately 716,000 square feet constructed in four office
buildings and an amenities building in Sunnyvale, California as
our headquarters. The operating lease term commenced in phases
from January through April 2001 and ends on January 24, 2013.
Minimum monthly lease payments are $2.2 million and will
escalate annually with the total future minimum lease payments
amounting to $347.9 million over the lease term. We also
contributed $80.0 million towards leasehold improvement costs of
the facility and for the purchase of equipment and furniture of
which approximately $49.2 million was written off in connection
with the abandonment of excess facilities. As part of this
agreement, we are required to hold certificates of deposit
totaling $25.7 million as a form of security through fiscal
2013, which is classified as restricted cash on the condensed
consolidated balance sheets. In the quarter ended March 31,
2002, a certificate of deposit totaling $2.5 million as a
security deposit for our headquarters was released.

"Operating lease payments shown above exclude any adjustment for
lease income due under noncancelable subleases of excess
facilities, which amounted to $82.9 million as of June 30, 2002.
Interest expense related to capital lease obligations is
immaterial for all periods presented.

"We do not have commercial commitments under lines of credit,
standby lines of credit, guarantees, standby repurchase
obligations or other such arrangements.

"We expect to incur significant operating expenses, particularly
research and development and sales and marketing expenses, for
the foreseeable future in order to execute our business plan. We
anticipate that such operating expenses, as well as planned
capital expenditures, will constitute a material use of our cash
resources. As a result, our net cash flows will depend heavily
on the level of future sales, our ability to manage
infrastructure costs and our assumptions about estimated
sublease income related to the estimated costs of abandoning
excess leased facilities.

"Although our existing cash, cash equivalent and investment
balances together with our anticipated cash flows from
operations will be sufficient to meet our working capital and
operating resource expenditure requirements for at least the
next 12 months, given the significant changes in our business
and results of operations in the last 12 to 18 months, the
fluctuation in cash, cash equivalents and investments balances
may be greater than presently anticipated. After the next 12
months, we may find it necessary to obtain additional equity or
debt financing. In the event additional financing is required,
we may not be able to raise it on acceptable terms or at all."


AURORA FOODS: Brings-In Steve Smiley as VP for Purchasing
---------------------------------------------------------
Aurora Foods Inc. (NYSE: AOR), a producer and marketer of
leading food brands, announced another important step in the
strengthening of its leadership team with the appointment of
Steve Smiley as Vice President, Purchasing.  Mr. Smiley joined
Aurora on March 31 and reports directly to Eric Brenk, the
Company's Co-President and Co-Chief Operating Officer.  In his
new position, Mr. Smiley will manage all of Aurora's supplier
relationships.

"Steve is a solid addition to our leadership team," said Dale F.
Morrison, Aurora's Chairman and Chief Executive Officer.  "He is
a proven procurement and supply chain executive who knows the
consumer packaged goods industry inside and out, having spent
the majority of his career at Colgate and Mars. He will play a
major role in maximizing our supplier relationships and making
Aurora a more productive and profitable organization."

Before working at Aurora, Mr. Smiley most recently was the
Director, Strategic Procurement for Hill's Pet Nutrition, Inc.,
a $1.4 billion subsidiary of Colgate-Palmolive.  Prior to
Colgate, Mr. Smiley held senior purchasing positions for the M&M
Mars and Uncle Ben's divisions of Mars, Inc. He has a MS in Food
and Resource Economics from the University of Florida and a BA
in Economics from Dartmouth College.

Aurora Foods Inc., based in St. Louis, Missouri, is a producer
and marketer of leading food brands, including Duncan Hines(R)
baking mixes; Log Cabin(R), Mrs. Butterworth's(R) and Country
Kitchen(R) syrups; Lender's(R) bagels; Van de Kamp's(R) and Mrs.
Paul's(R) frozen seafood; Aunt Jemima(R) frozen breakfast
products; Celeste(R) frozen pizza and Chef's Choice(R) skillet
meals.  More information about Aurora may be found on the
Company's Web site at http://www.aurorafoods.com

As reported in Troubled Company Reporter's February 28, 2003
edition, Standard & Poor's Ratings Services lowered its
corporate credit rating on packaged foods company Aurora Foods
Inc., to 'CCC' from 'B-'.

The outlook on the St. Louis, Missouri-based company is
negative. The company had a total debt of about $1.05 billion as
of Dec. 31, 2002.

The downgrade reflects Aurora's inability to meet Standard &
Poor's expectation of improved operating and financial
performance in a timely manner.

"The ratings reflect Aurora's weak financial profile, including
its high debt levels and limited financial resources," said
Standard & Poor's credit analyst Ronald Neysmith. "These factors
are partially mitigated by the company's niche position in the
branded packaged food industry."

DebtTraders says that Aurora Foods Inc.'s 9.875% bonds due 2007
(AOR07USR2) are trading at 43 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=AOR07USR2for
real-time bond pricing.


BORDEN CHEMICALS: BCP Finance Wants Case Converted to Chapter 7
---------------------------------------------------------------
BCP Finance Corporation, one of the Debtors in the jointly
consolidated case of Borden Chemicals and Plastics Operating
Limited Partnership, wants to convert its Chapter 11 Case,
Number 01-1269, to a liquidation proceeding under the Chapter 7
of the Bankruptcy Code.

The Debtors point out that under Section 1112(a) of the
Bankruptcy Code, a debtor has the absolute right to convert its
chapter 11 case under Chapter 7 of the Bankruptcy Code, without
notice and hearing unless:

      a) the debtor is not a debtor-in-possession;

      b) the case originally was commenced as an involuntary case
         under this chapter; or

      c) the case was converted to a case under this chapter
         other than on the debtor's request.

BCP Finance says that none of these three conditions apply to
its case.  Moreover, no trustee has been appointed in this
cases.

BCP explains that it has no continuing operations and no more
assets left to administer.  Consequently, there is no benefit to
continue the chapter 11 case and conversion is appropriate under
the circumstances.

Under the Debtors' plan, BCP Liquidating LLC, successor in
inters to BCP, is the sole shareholder of BCP Finance. BCP
Finance has no assets, however, it requires assistance from
professionals to administer the last stages of BCP Finance Case.
Accordingly, BCP Finance wants the Court to require BCP
Liquidating LLC to pay for valid professional fees and reimburse
valid expenses incurred in connection with the administration of
the BCP Finance Case.

DebtTraders reports that Borden Chemical & Plastics' 9.500%
bonds due 2005 (BCPU05USR1) are trading between 0.5 and 1. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=BCPU05USR1
for real-time bond pricing.


BUDGET GROUP: Committee Brings-In Gibson Dunn as French Counsel
---------------------------------------------------------------
Budget France S.A. is a wholly owned direct subsidiary of
Societe Financiere et de Participation, a dormant holding
company and a wholly owned subsidiary of BRACII.  Budget France
has been operating since the late 1980's and until approximately
mid to late 1998 was largely a franchise operation with only a
few corporate owned locations and a small corporate structure to
support such locations.  Beginning in the late end of 1998 and
continuing throughout 1999, Budget France embarked on a strategy
of acquiring franchises on a territorial basis and converting
them to corporate owned locations.  During this 18-month period
of acquisitions, Budget France increased its gross revenues to
approximately $80,000,000.  This increase was primarily
attributable to the higher profit margins associated with
corporate owned locations as opposed to the royalty stream
associated with franchised locations.

On the other hand, Budget France's rapid growth created
significant integration and corporation support problems.
Budget France implemented a consolidation strategy and incurred
significant expenses in attempting to integrate the acquired
locations.  Despite its best efforts, Budget France was unable
to fully integrate the acquired locations in an efficient
manner. As a consequence, Budget France lost approximately
$75,000,000 in 2000.

In 2001, consistent with the strategy Budget was implementing
throughout Europe, Budget France began moving toward a master
financing model designed to take advantage of the cost savings
associated with a franchise model and the higher margins
associated with certain strategically located corporate owned
operations.  Given the losses associated with the integration
problems encountered in Budget France's acquisition strategy,
and the significant amounts that were owed by Budget France in
connection with the acquisitions, Budget France did not have
sufficient capital to carry out this master franchising
strategy.

On July 25, 2002, Budget France was forced into receivership
under French insolvency law, and Maitre Gilles Baronnie was
appointed as its Receiver.

                      Gibson's Retention

The Official Committee of Unsecured Creditors sought and
obtained the Court's authority to retain Gibson, Dunn & Crutcher
LLP as its special French transactional counsel in connection
with these Chapter 11 cases, nunc pro tunc to November 20, 2002.

The Committee is actively working with the Debtors to formulate,
evaluate and implement a solution to Budget France's
difficulties.  In connection therewith, the Committee requires
the advice and counsel of a French transactional counsel.

William Bowden, Esq., at Ashby & Geddes, in Wilmington,
Delaware, explains that the Committee has selected Gibson due to
its expertise in French transactional law, and in particular,
Stephan Haimo, Esq.  Mr. Haimo has extensive experience in
French corporate and bankruptcy matters, both by reason of his
years spent practicing law in Paris and his continuing
representation of clients involved in transactions in France.
His familiarity with French insolvency laws -- he obtained a
post-graduate degree from the University of Paris with a
concentration in creditors' rights and insolvency -- and his
corporate finance practice have led him to be retained by
investment funds and institutional investors in connection with
workouts, loan restructurings, recapitalizations and buy-outs in
a variety of French industries, including travel and
hospitality, construction materials, consumer goods and retail
distribution.  The Committee believes that Gibson is well
qualified to represent them in these cases.

Gibson will provide the required French transactional support to
the Committee concerning Budget France, including advising,
representing the Committee with respect to:

     A. expertise with respect to evaluation of possible
        restructuring or strategic dispositions of Budget
        France's assets under French transactional law;

     B. French corporate, mergers and acquisitions, and
        securities law advice in respect of structuring Budget
        France's operations; and

     C. expertise with respect to French corporate arrangements
        and related issues.

Gibson will charge the Committee for its legal services on an
hourly basis in accordance with its ordinary and customary rates
in effect on the date these services are rendered, and for
reimbursement of all costs and expenses incurred in connection
with these cases.  Gibson's current billing rates generally
range from:

           Partners                     $480 - 705
           Associates                    235 - 480
           Paralegals                    105 - 255

These hourly rates are reviewed annually and are set at a level
designed fairly to compensate Gibson for the work of its legal
staff and to cover fixed and routine overhead expenses.
Gibson's hourly rates are appropriate for firms like Gibson's
and comparable to the hourly rates charged by Gibson's
competitors. Gibson competes on the basis of the quality of its
lawyers, the responsiveness of its service and the creativeness
and flexibility of its approach, rather than on hourly rates.
Gibson tries particularly hard, however, to staff matters with
the fewest number of lawyers possible, and to maintain
consistency over the client relationship, to reduce
inefficiencies and to hold costs down.

Gibson Partner Stephen Haimo assures the Court that the firm,
its partners, associates and paralegals do not represent or hold
any interest adverse to the Debtors with respect to the matters
on which the firm is to be employed and do not have any material
connections with the Debtors, their officers, affiliates,
creditors, or any other party-in-interest or their attorneys and
accountants or the United States Trustee.  However, Gibson will
conduct an ongoing review of its files to ensure that no
conflicts or other disqualifying circumstances exist or arise.
If any new relevant facts or relationships are discovered,
Gibson will disclose this to the Court. (Budget Group Bankruptcy
News, Issue No. 18; Bankruptcy Creditors' Service, Inc.,
609/392-0900)


CINEMARK USA: Posts Improved Revenues for Fiscal Year 2002
----------------------------------------------------------
Cinemark USA, Inc.'s revenues in 2002 increased to $939.3
million from $853.7 million in 2001, a 10.0% increase. The
increase in revenues is primarily attributable to a 12.1%
increase in attendance resulting from stronger film product in
2002. Revenues per average screen increased 7.8% to $311,555 for
2002 from $288,961 for 2001.

Cost of operations, as a percentage of revenues, decreased to
73.6% in 2002 from 75.8% in 2001. The decrease is primarily
related to the 10.0% increase in revenues and Cinemark's ability
to effectively control its theatre operating costs (some of
which are of a fixed nature). The decrease as a percentage of
revenues resulted from a decrease in facility lease expense as a
percentage of revenues to 12.4% in 2002 from 13.4% in 2001, a
decrease in utilities and other costs as a percentage of
revenues to 11.2% in 2002 from 11.9% in 2001, a decrease in
salaries and wages as a percentage of revenues to 10.4% in 2002
from 10.6% in 2001, a decrease in concession supplies as a
percentage of concession revenues to 17.3% in 2002 from 17.4% in
2001, partially offset by an increase in film rentals and
advertising as a percentage of admissions revenues to 53.9% in
2002 from 53.7% in 2001 as a result of stronger film product in
2002.

General and administrative expenses, as a percentage of
revenues, increased to 5.1% in 2002 from 5.0% in
2001. General and administrative expenses increased to $48.2
million for 2002 from $42.7 million for 2001. The increase is
primarily related to the write-off of $3.1 million of legal,
accounting and other professional fees and costs associated with
the parent company, Cinemark, Inc.'s, proposed initial public
offering which was subsequently postponed due to unfavorable
market conditions.

Depreciation and amortization decreased to $66.9 million in 2002
from $73.5 million in 2001. Depreciation and amortization as a
percentage of revenues decreased to 7.1% in 2002 from 8.6% in
2001. The decrease is partially related to the January 1, 2002
adoption of Statement of Financial Accounting Standards ("SFAS")
No. 142 which required that goodwill and other intangible assets
with indefinite useful lives no longer be amortized. The
decrease is also related to a reduction in the depreciable basis
of properties and equipment resulting from the devaluation in
foreign currencies (primarily in Argentina, Mexico and Brazil)
and the decline in new construction.

The Company recorded asset impairment charges of $3.9 million in
2002 and $20.7 million in 2001 related to assets held for use.
The asset impairment charges recorded in 2002 related to a $0.6
million write-down to fair value of goodwill associated with the
Argentina operations, a $0.2 million write-down to fair value of
one theatre property associated with the El Salvador operations,
a $1.3 million write-down to fair value of one theatre property
associated with the Chile operations and a $1.8 million write-
down to fair value of two theatre properties and one real estate
parcel in the U.S. All of the impairment charges recorded in
2001 were in the U.S. except for a $1.7 million write-down to
fair value of one theatre property associated with the Brazil
operations. In accordance with SFAS No. 144 and SFAS No. 121,
the Company wrote down these assets to their estimated fair
value in 2002 and 2001, respectively.

Cinemark recorded a loss on sale of assets and other of $0.5
million in 2002 and $12.4 million in 2001. Included in loss on
sale of assets and other in 2001 is a charge of $7.2 million to
write down one property to be disposed of in the U.S. to fair
value and a charge of $1.5 million to write down one property to
be disposed of in Argentina to fair value.

Interest costs incurred, including amortization of debt issue
cost, decreased 18.5% to $57.8 million in 2002 from $70.9
million in 2001. The decrease in interest costs incurred during
2002 was due principally to a decrease in average debt
outstanding under the Company's credit facility and the lower
interest rates on its variable rate debt facilities.

Income tax expense of $29.2 million was recorded in 2002 as
compared to an income tax benefit of $14.1 million in 2001. The
Company's effective tax rate for 2002 was 42.8% as compared to
77.8% in 2001. The change in the effective tax rate is mainly
due to the recognition of the Mexico deferred tax asset in 2001.

Income before the cumulative effect of an accounting change
increased to $39.0 million for 2002 from a loss of $4.0 million
for 2001 primarily as a result of the 10.0% increase in revenues
and the decrease in interest expense and depreciation and
amortization expense in 2002 in comparison with 2001.

Cinemark USA is continuing to expand its U.S. theatre circuit.
In 2002, it opened two new theatres with 16 screens. As of March
17, 2003, it has signed commitments for eight new theatres with
100 screens and a five screen expansion to an existing theatre
scheduled to open in the U.S. in 2003 and thereafter. The
Company estimates the remaining capital expenditures for the
development of these 105 screens in the U.S. will be
approximately $40 million. Actual expenditures for continued
theatre development and acquisitions are subject to change based
upon the availability of attractive opportunities. Cinemark USA
plans to fund capital expenditures for its continued development
from cash flow from operations, borrowings under its credit
facility, subordinated note borrowings, proceeds from sale
leaseback transactions and/or sales of excess real estate.
Additionally, it may from time to time, subject to compliance
with its debt instruments, purchase on the open market its debt
securities depending upon the availability and prices of such
securities.

Cinemark is also continuing to expand its international theatre
circuit. In 2002, it opened five new theatres with 42 screens
and added two additional screens to an existing theatre. As of
March 17, 2003, it has five new theatres with 32 screens and a
two screen expansion to an existing theatre scheduled to open in
international markets in 2003 and thereafter. The Company
estimates the remaining capital expenditures for the development
of these 34 screens in international markets will be
approximately $15 million. Actual expenditures for continued
theatre development and acquisitions are subject to change based
upon the availability of attractive opportunities. Cinemark
anticipates that investments in excess of available cash will be
funded by the Company or by debt or equity financing to be
provided by third parties directly to Cinemark's subsidiaries.

                           *   *   *

As reported in August 13, 2002, edition of the Troubled Company
Reporter, Standard & Poor's Ratings Services has revised its
outlook on movie exhibitor Cinemark USA Inc., to stable from
positive following the company's postponement of its planned IPO
and bank loan refinancing.

Standard & Poor's has also withdrawn its double-'B'-minus bank
loan rating on the company's proposed $250 million bank
facility. All other ratings, including the single-'B'-plus
corporate credit rating, are affirmed. The Plano, Texas-based
company had $784 million in debt outstanding as of March 31,
2002.


CLASSIC COMMS: Wants Lease Decision Period Extended Until July 7
----------------------------------------------------------------
Classic Communications, Inc., and its debtor-affiliates ask the
U.S. Bankruptcy Court for the District of Delaware for more time
to determine whether to assume, assume and assign, or reject
their unexpired nonresidential real property leases.  The
Debtors want their lease decision period to run through
July 7, 2003.

The Debtors maintain their chapter 11 cases are complex,
compounded by the overall size of the Debtors' businesses and by
the large number of Unexpired Leases under which the Debtors are
lessees.

The Debtors' Unexpired Leases are an integral part of their
business operations and are vital to the success of their Plan
of Reorganization, which is in part premised upon the assumption
and assignment of certain Unexpired Leases.  The Confirmation
Order provides that on the Effective Date all executory
contracts and unexpired leases shall be deemed assumed unless
specifically rejected.

Until the Debtors have had an opportunity to fully complete
their evaluation of the Unexpired Leases in conjunction with the
Plan, rejection of the Unexpired Leases would be premature and
may adversely affect the Debtors' ability to successfully
reorganize.

Classic Communications, Inc., a cable operator focused on non-
metropolitan markets in the United States, filed for Chapter 11
petition on November 13, 2001 (Bankr. Del. Case No. 01-11257).
Brendan Linehan Shannon, Esq. at Young, Conaway, Stargatt &
Taylor represents the Debtors in their restructuring efforts.
When the Company filed for protection from its creditors, it
listed $711,346,000 in total assets and $641,869,000 in total
debts.


COLUMBIA CENTER: Fitch Hatchets $20.2M Class E Note Rating to BB
----------------------------------------------------------------
Fitch Ratings downgrades Columbia Center Trust's commercial
mortgage pass-through certificates, series 2000-CCT as follows:
$114.6 million class A and interest-only class X1 to 'AA' from
'AAA'; $22.9 million class B to 'A' from 'AA'; $20.4 million
class C to 'BBB+' from 'A+'; $17.0 million class D to 'BBB-'
from 'A-' and $20.2 million class E to 'BB' from 'BBB'. In
conjunction with the downgrades, class E is removed from Rating
Watch Negative. The downgrades are a result of the increased
vacancy at the subject property.

The certificates are secured by a first priority deed of trust
and security agreement on two adjacent buildings, Bank of
America Tower and Columbia House, totaling 1.54 million square
feet and located in downtown Seattle, WA.

The class E bonds were originally placed on Rating Watch
Negative in September 2002 due to the fact that the largest
tenant in the Bank of America Tower, a 76-story class A office
building, announced it would vacate in January 2003. Since then,
several other tenants with lease expirations in 2003 either have
announced they will vacate or have signed new leases at current
market rents, which are significantly below previous rents.
Fitch took into consideration new leases signed to date for the
remainder of 2003 and the vacant space to determine a Fitch 2003
projected net cash flow of $19.5 million. The resulting Fitch
stressed debt service coverage ratio based on a 9% refinance
constant is a 1.11 times down from 1.45x at issuance. Current
occupancy at the property is approximately 76%, but will fall to
73% as of year end 2003 if no new leases are signed. Occupancy
at the property is below the market occupancy of 84%.

Fitch continues to be concerned with rollover at the property,
as an additional 13% of the leases expire in 2004. The lower
market rents, increased vacancy and limited new leasing
activity, may affect the borrower's ability to refinance the
loan at maturity in December 2004.

Even with the drop in rental income at the property projected
throughout 2003, the loan's LIBOR +1.15% interest rate will keep
actual DSCR high at 3.35x. Therefore, Fitch is not concerned
about payment default within the loan term.

The property has strong sponsorship in NY State Common and
Equity Office Properties, the largest landlord of office space
in the Seattle area. The property also benefits from a strong
management team, Wright, Runstad & Company, who continues to
actively market the office space.


CONSECO: Gets Court Okay for Herzog Separation & Consulting Pact
----------------------------------------------------------------
David K. Herzog is the former general counsel of Conseco Inc.
and served as a member of the Board of Directors of certain
Conseco subsidiaries.  Mr. Herzog's employment relationship with
Conseco ended on February 12, 2003.  The Debtors have since
determined that it is in their best interest to retain Mr.
Herzog's services as an independent consultant.

The Debtors sought and obtained Judge Doyle's permission to
enter into a separation and consulting agreement with Mr.
Herzog. The Debtors also obtained Court approval to accord
payments to Mr. Herzog with administrative expense priority
under Section 503(b) of the Bankruptcy Code.

Under the Consulting Agreement, Conseco will retain Mr. Herzog
as an independent consultant for 18 months.  Conseco will
pay Mr. Herzog $600,000 in 18 equal monthly installments plus a
$600,000 lump sum after the consulting period.  Mr. Herzog will
perform no more than 40 hours of service per month.

Mr. Herzog will not disclose any confidential information at any
time. He will not render services to any competitor or other
industry participant. (Conseco Bankruptcy News, Issue No. 15;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


COVANTA ENERGY: Earns Nod to Extend and Amend DIP Credit Pact
-------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
approved the motion to extend and amend the DIP Agreement in the
Chapter 11 cases of Covanta Energy Corporation and its debtor-
affiliates

James L. Bromley, Esq., at Cleary, Gottlieb, Steen & Hamilton,
in New York, reported that the finalized terms of the DIP
Amendment are:

     -- The Stated Maturity Date of the DIP Agreement will be
        extended from April 1, 2003 to October 1, 2003;

     -- The Tranche A Commitments under the DIP Agreement will be
        reduced;

     -- Certain monthly reporting and financial budget
        requirement covenants of the DIP Agreement will be
        modified; and

     -- A $142,000 fee will be paid to the DIP Lenders, amounting
        to 1% of the Tranche A Commitments under the DIP
        Agreement following the DIP Amendment.

A free copy of the Sixth DIP Amendment is available at:

        http://bankrupt.com/misc/Sixth_DIP_Amendment.pdf
(Covanta Bankruptcy News, Issue No. 26; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


CREST DARTMOUTH: Fitch Rates $12.25 Million Class D Notes at BB
---------------------------------------------------------------
CREST Dartmouth Street 2003-1, Ltd's and CREST Dartmouth Street
2003-1, Corp.'s $280 million class A notes are rated 'AAA' by
Fitch Ratings. Additionally, Fitch rates the $13.125 million
class B-1 notes and $21 million class B-2 notes 'A', $14.875
million class C notes 'BBB' and $12.25 million class D notes
'BB'.

The rating on the class A notes addresses the timely payment of
interest and ultimate repayment of principal. The ratings on the
class B-1, class B-2, class C and class D notes address the
ultimate payment of interest and the ultimate repayment of
principal.

The ratings are based on the capital structure, quality and
diversity of the portfolio assets and the experience and
capabilities of MFS Investment Management.

Net proceeds from issuance are used to purchase a diversified
portfolio consisting of commercial mortgage-backed securities,
real estate investment trust securities, and commercial mortgage
loans. As of closing, the Fitch weighted-average rating factor
is (WARF) 16.9 (between 'BBB' and 'BBB-') and the portfolio is
100% funded. There will be no reinvestment in the transaction
and quarterly payments will begin in May 28, 2003 for all
classes of notes.


DDI CORP: Installs New Inspection Technology at San Jose Plant
--------------------------------------------------------------
Dynamic Details, Inc. (DDI), (Nasdaq: DDIC), a leading provider
of technologically advanced design, development, and
manufacturing services, today announced that it has installed 3D
X-ray automated inspection (5DX) equipment in its newly expanded
61,000-square-foot manufacturing facility in San Jose,
California.

"DDi specializes in cutting-edge manufacturing technology and
the addition of this inspection technology increases our value-
add for both NPI and low-volume, high-technology customers,"
commented Mike Coleman, site general manager.  "Our Agilent 5DX
Series III machine has been a great process and test addition
for our customers since we began offering the technology in
January."

The 5DX utilizes a Laminography scanning principle, providing
visibility and fault detection across the entire solder joint.
The assembly industry consensus is that it can achieve an
average of 98% coverage for solder joint inspection (including
non-visible solder joints for BGAs, CSPs, etc.).  Other
advantages include: detecting marginal solder joints; enabling
SPC monitoring and process improvement; eliminating time and
cost of complex fixturing; and simplifying DFT and test
development platforms in contrast to the more conventional
electrical and mechanical methods.

The Agilent 5DX compliments DDi's full scale testing solutions,
which includes the 2DX X-ray, AOI process inspection, Takaya
flying probe testers, Agilent 3070 series ICT, static and
dynamic burn-in chambers, state-of-the-art automated tents, and
full functional test development and implementation.

DDi is a leading provider of time-critical, technologically
advanced, electronics manufacturing services.  Headquartered in
Anaheim, California, DDi and its subsidiaries, with fabrication
and assembly facilities located across North America and in
England, service approximately 2,000 customers worldwide.

                          *    *    *

As reported in Troubled Company Reporter's April 3, 2003
edition, Standard & Poor's Ratings Services lowered its rating
on circuit-board maker DDi Corp.'s senior secured bank loan to
'CC' from 'CCC-' and lowered the rating on the 6.25% convertible
subordinated note to 'D' from 'C'. At the same time, Standard &
Poor's affirmed the 'C' rating on the 12.5% senior discount note
of DDi Capital Corp., a ratings family member. The ratings on
DDi's senior secured bank loan and DDi Capital's 12.5% senior
discount note remain on CreditWatch with negative implications,
where they were placed on March 6, 2003. The corporate credit
rating on both entities is 'SD'.

The actions were taken because DDi's forbearance agreement with
senior lenders expired today, and the company announced it would
not make the interest payment today on the 6.25% convertible
subordinated note maturing on April 1, 2007. The Anaheim,
Calif.-based company and related entities reported total debt of
about $403 million as of Dec. 31, 2002.

DDi continues to negotiate with its senior lenders and
subordinated convertible noteholders, in efforts to restructure
the company's debt. Independent accountants, engaged by
management, have expressed a substantial doubt about the
company's ability to continue as a going concern.


DIRECTV: Raven America Wants to Transfer Case to Florida Court
--------------------------------------------------------------
William H. Sudell, Esq., at Morris, Nichols, Arsht & Tunnel, in
Wilmington, Delaware, relates that on November 10, 2000, DirecTV
Latin America, LLC entered into a Stock Purchase Agreement with
Grupo Clarin and Plataforma Digital, S.A., a wholly owned
subsidiary of Grupo Clarin.  Pursuant to the Stock Purchase
Agreement, DirecTV purchased from Plataforma shares of Galaxy
Entertainment Argentina, S.A., representing 51% of Galaxy's
total outstanding shares, in exchange for the issuance to
Plataforma of DirecTV's membership interests, representing 4% of
DirecTV's total outstanding membership interests -- Debtor
Interests.

Moreover, Mr. Sudell informs Judge Walsh that Plataforma and
DirecTV are also parties to a Put Agreement dated November 10,
2000.  Pursuant to the Put Agreement, DirecTV agreed, under
certain circumstances, to repurchase the Debtor Interests from
Plataforma for $194,800,000.

Plataforma subsequently merged with and into Multicanal S.A., a
wholly owned Grupo Clarin subsidiary, with Multicanal as the
surviving company.  As a result, Multicanal became the Debtor
Interests owner and the holder of the rights associated with the
Put Agreement.  Multicanal subsequently transferred its interest
in the Put Agreement and the Debtor Interests to Raven Media
Investments LLC, an Argentine company and a wholly owned
subsidiary of Grupo Clarin, S.A.

Pursuant to Section 1412 of the Judiciary Procedures Code and
Rule 1014 of the Federal Rules of Bankruptcy Procedure, Raven
asks the Court to transfer the venue of this case to the U.S.
Bankruptcy Court for the Southern District of Florida, Fort
Lauderdale Division.

Mr. Sudell contends that the transfer should be granted because,
although DirecTV was incorporated in Delaware, its headquarters
and the majority of its 113 employees are located in Fort
Lauderdale, Florida, over 700 of DirecTV's creditors are located
in various cities throughout the State of Florida, and 10 of its
20 largest unsecured creditors are located in Florida.  Thus:

     (a) it will be more convenient for all of these constituents
         to have the bankruptcy proceeding in Florida;

     (b) given that a large number of DirecTV's creditor
         relationships are centered in Florida, it is likely that
         Florida state law may apply to any disputes among other
         creditors;

     (c) the 20 largest creditors appears indicative of DirecTV's
         overall creditor body;

     (d) in all likelihood, both meeting of the official
         committee of unsecured creditors and with DirecTV will
         occur in south Florida;

     (e) many of DirecTV's employees and creditors would be able
         to avoid travel to and from Delaware, which can be
         expensive, time-consuming and difficult given the
         realities of today's air travel;

     (f) numerous parties-in-interest, as well as DirecTV's
         primary assets, are located in Latin America, which, due
         to its geographical proximity to Latin America, and the
         much greater availability of airline flights, the
         Florida Bankruptcy Court would be a considerable more
         convenient venue than the Delaware Bankruptcy Court; and

     (g) the Delaware Bankruptcy Court's per judge case load for
         Chapter 11 cases is significantly higher as compared to
         the Florida Bankruptcy Court.

                           Debtor Objects

"Raven's motion is a transparent attempt by an out-of-the-money
equity interest holder to forum shop or, at a minimum, to delay
the progress of DirecTV's bankruptcy case and thereby gain
leverage in settlement negotiations," Joel A. Waite, Esq., at
Young Conaway Stargatt & Taylor LLP, in Wilmington, Delaware,
declares.

Raven claims to be a creditor based on its purported right under
a Put Agreement to put, under certain circumstances, its 4% LLC
equity interest in DirecTV.  However, Mr. Waite explains that
any claims that Raven might hold as a result of the Put
Agreement is subject to mandatory subordination under Section
510(b) of the Bankruptcy Code and controlling Third Circuit
precedent.  Thus, Raven's claim must be treated as an equity
interest for all purposes in this case.

In contrast, the Southern District of Florida has less developed
precedent interpreting and applying Section 510(b).  While
DirecTV is confident that, if confronted with the issue, the
Eleventh Circuit would ultimately agree that the plain language
of Section 510(b) requires the subordination of Raven's
purported claim under the Put Agreement, a transfer of venue
would likely result in costly and protracted litigation between
the estate and Raven over the status of Raven's claim under the
Put Agreement. Though Raven might desire that result, the
estate's unsecured creditors would ultimately bear this
unnecessary cost.

As a substantive matter, Mr. Waite asserts that Raven has not
established sufficient grounds for this Court to transfer venue
as:

     (a) the transfer of venue would not benefit DirecTV's
         creditors, many of whom are sophisticated corporations
         with a national or multinational presence and are -- and
         throughout their relationship with DirecTV have been --
         represented by counsel from place like California, New
         York, Illinois, Washington, London or Switzerland rather
         than from Florida.  This is the case with Buena Vista
         International, Inc., HBO Latin America Partners, Music
         Choice, Kirch and Thomson Consumer Electronics -- each
         of which is on the Creditors' Committee -- and also with
         respect to Raven, its predecessors-in-interest and its
         affiliates;

     (b) DirecTV's assets are comprised largely of intangible
         contract rights, few of which are governed by Florida
         law.  Most of DirecTV's contracts are governed by
         California or New York law.  To the extent
         Interpretation of the law governing DirecTV's contracts
         becomes necessary in this case, it is clear that this
         Court has more than adequate experience in interpreting
         California or New York law and applying that law to any
         issues it may arise in this case;

     (c) DirecTV believes that Delaware's developed case law on
         Chapter 11 issues and significant experience dealing
         with large, complex cases will provide it and other
         parties-in-interest substantial certainty, finality and
         ease of administration in this case and that these
         factors outweigh the highly uncertain benefit that could
         be provided by the Southern District of Florida's lesser
         Chapter 11 case load; and

     (d) the transfer would delay DirecTV's reorganization
         efforts, would force DirecTV, the Creditors' Committee
         and various creditors to seek new or additional counsel,
         and overall would impose unnecessary administrative
         expense on this estate in exchange for which neither it
         nor its creditors would receive any discernable benefit.

Accordingly, DirecTV asks the Court to deny the motion.

                   Hughes Electronics Joins In

Hughes Electronic Corporation an its wholly owned subsidiary,
DirecTV Latin America Holdings, Inc. adopt by reference the
Debtor's Objection to the Motion and ask the Court to deny the
motion.

John H. Knight, Esq., at Richards, Layton & Finger P.A., in
Wilmington, Delaware, states that Hughes is the postpetition
secured lender of the Debtor while Holdings owns about 75% of
the Debtor's equity.  Moreover, the aggregate prepetition claim
of the Hughes Entities is the Debtor's largest unsecured
prepetition claim.

To supplement and amplify the Debtor's objection, Mr. Knight
relates that:

     (a) Raven's characterization of the Debtor's Chapter 11 case
         is ill-informed and misleading because this is not a
         simple, uncomplicated case having no bearing beyond the
         confines of Fort Lauderdale, Florida;

     (b) the Debtor's creditor body is complex and national or
         multinational in scope;

     (c) the Debtor's primary, and perhaps sole, connection to
         Florida is the location of its headquarters in Florida,
         which is not an important factor in determining
         appropriate venue; and

     (d) Raven's characterization of itself as the Debtor's
         creditor protecting the interest of the majority is
         similarly misleading as it is in fact an equity holder.
         It is the Hughes Entities and the members of the
         Committee that hold at least 88% of the amount of the
         prepetition claims against the Debtors -- both of which
         oppose the motion.

             Creditors' Committee Supports DirecTV

For the same reasons DirecTV raised in its objection to the
Motion, the Official Committee of Unsecured Creditors objects to
the motion and asks the Court to deny the change of venue
request. (DirecTV Latin America Bankruptcy News, Issue No. 4;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


DIXIE GROUP: Expects Lower Sales Volume & Higher Costs for Q1
-------------------------------------------------------------
The Dixie Group, Inc., (Nasdaq/NM:DXYN) said its first quarter
2003 results would be adversely affected by lower-than-expected
sales volume and higher costs. The Company had anticipated a
small profit for the quarter ended March 29, 2003, but now
expects to report a loss of approximately $.03 per diluted
share.

"Sales in our high-end businesses at Fabrica and Masland
continue to show positive comparisons; however, weakness in our
home center and factory-built housing markets will result in
carpet revenues being approximately 7% below the prior-year
level," commented Daniel K. Frierson, chairman and chief
executive officer. "While the first quarter is generally the
slowest of the year for the carpet industry, typically sales
begin to build after January. This trend appears to have been
delayed this year by general economic and geopolitical
uncertainties, but we expect sales to improve, based on the
stronger order entry we have experienced in late March and early
April.

"First quarter 2003 margins were negatively affected by lower
sales volume, raw material price increases and expenses incurred
launching our new Dixie Home product line," Frierson added.
"Along with most of our competitors in the industry, we have
announced selling price increases beginning in April 2003 to
improve margins.

"We addressed sales in our high-end markets in 2002 by
intensifying our focus on new product introductions. Despite
weakness in most carpet markets, these efforts have had a
positive impact on sales levels at Fabrica and Masland. In early
2003, our North Georgia Operations introduced a new collection
of products at Surfaces under the Dixie Home name. These
products have received significant acceptance in the
marketplace, resulting in excellent placement with leading
national retailers. We expect this new collection of products to
make a sound contribution to our sales and margins beginning in
the third quarter."

The Dixie Group -- http://www.thedixiegroup.com-- is a leading
carpet and rug manufacturer and supplier to higher-end
residential and commercial customers serviced by Fabrica
International, Masland Carpets and products under the Dixie Home
name, to consumers through major retailers under the Bretlin,
Globaltex and Metro Mills brands, and to the factory-built
housing and recreational vehicle markets through Carriage
Carpets. Dixie's Candlewick Yarns serves specialty carpet yarn
customers.

As reported in Troubled Company Reporter's April 8, 2003
edition, Standard & Poor's Ratings Services raised its corporate
credit rating on Calhoun, Georgia-based carpet and rug
manufacturer The Dixie Group Inc. to 'B+' from 'B-'. At the same
time, the subordinated debt rating was raised to 'B-' from
'CCC'. The outlook is stable.

Total debt outstanding at Dec. 28, 2002, was about $149 million.

"The rating actions reflect the company's improved operating
performance and the related improvement in credit protection
measures," said Standard & Poor's credit analyst Susan Ding. "In
addition, in March 2003 the company made the final $50 million
payment on its acquisition of Fabrica International Inc.,
substantially alleviating Standard & Poor's near-term liquidity
concerns. Dixie acquired Fabrica in 2000."


EASYLINK: Fails to Regain Compliance with Nasdaq Requirements
-------------------------------------------------------------
EasyLink Services Corporation (NASDAQ: EASY) received a Nasdaq
Staff Determination on April 8, 2003 indicating that the Company
failed to regain compliance with Nasdaq's Marketplace Rules
4350(C) and (d) (2).  Those rules require listed companies to
maintain an audit committee of at least three members, comprised
solely of independent directors.

Its common stock is therefore subject to delisting from the
Nasdaq National Market. The Company will request a hearing
before the Nasdaq Listing Qualifications Panel to review the
Staff Determination. EasyLink stock will continue to be listed
on the Nasdaq National Market pending the final decision of the
Qualifications Panel.

The hearing is expected to occur within 45 days of its hearing
request. At the hearing, the Company intends to submit a plan
that it believes will demonstrate its ability to regain
compliance with the three-member requirement. There can be no
assurance the Panel will grant the Company's request for
continued listing. A decision by the Panel is typically provided
within four weeks of the hearing.

EasyLink Services Corporation (NASDAQ: EASY), headquartered in
Piscataway, New Jersey, is a leading global provider of services
that power the exchange of information between enterprises,
their trading communities, and their customers. EasyLink's
networks facilitate transactions that are integral to the
movement of money, materials, products, and people in the global
economy, such as insurance claims, trade and travel
confirmations, purchase orders, invoices, shipping notices and
funds transfers, among many others. EasyLink helps more than
20,000 companies, including over 400 of the Global 500, become
more competitive by providing the most secure, efficient,
reliable, and flexible means of conducting business
electronically. For more information, please visit
http://www.EasyLink.com

                          *   *   *

As previously reported, EasyLink Services said it was seeking to
restructure substantially all of approximately $86.2 million of
outstanding indebtedness, including approximately $10.7 million
of capitalized future interest obligations. The Company is
currently in discussions with holders of its debt relating to
the proposed restructuring. To date, the holders of
approximately 70% of this debt have expressed interest in
completing a restructuring on the terms discussed.

Management seeks to restructure substantially all of the debt.
If all of the debt were successfully eliminated on the currently
proposed terms, the Company would pay approximately $2.0 million
in cash and issue up to 35 million shares of its Class A common
stock, including the shares issued to fund the cash payment. The
number of shares to be exchanged for each class of debt was
determined based on a deemed per share price of between $2.00
and $3.00.


EBIZ ENTERPRISES: Ceases Operations after Asset Foreclosure
-----------------------------------------------------------
EBIZ Enterprises, Inc.'s senior secured creditor has foreclosed
upon substantially all of the Company's assets pledged to secure
the obligations.  The Company defaulted on those obligations
earlier in 2003. As a result, the Company has discontinued its
operations effective at the close of business on April 4, 2003.

On September 7, 2001, Ebiz Enterprises, Inc., a Nevada
corporation, and its wholly-owned subsidiary, Jones Business
Systems, Inc., a Texas corporation filed separate voluntary
petitions under Chapter 11 of the Bankruptcy Code in federal
bankruptcy court in Phoenix, Arizona (Bankr. Case Nos. 01-11843-
CGC; and 01-11844-CGC).


ECHOSTAR COMMS: Shareholders' Meeting Scheduled for May 6, 2003
---------------------------------------------------------------
The Annual Meeting of Shareholders of EchoStar Communications
Corporation will be held on Tuesday, May 6, 2003, at 12:00 noon,
local time, at the Company's headquarters located at 5701 South
Santa Fe Drive, Littleton, Colorado 80120, to consider and vote
upon:

   1.  The election of the members of the Board of Directors;

   2.  A proposal to amend the Amended and Restated Articles of
       Incorporation to modify one of its indemnification
       provisions relating to payment of litigation expenses;

   3.  A proposal to ratify the appointment of KPMG LLP as
       independent auditors for the fiscal year ending
       December 31, 2003; and

   4.  Any other business that may properly come before the
       Annual Meeting or any adjournment of the meeting.

Only shareholders of record at the close of business on March
21, 2003 are entitled to notice of, and to vote at, the Annual
Meeting or any adjournment of the meeting.

As of December 31, 2002, the Company's balance sheet shows a
total shareholders' equity deficit of about $1.2 billion.


ENRON: EMPI Sues Connectiv Energy for Breach of Contract
--------------------------------------------------------
Enron Power Marketing, Inc. seeks declaratory relief against
Conectiv Energy Supply, Inc.

Barry J. Dicther, Esq., at Cadwalader, Wickersham & Taft, in New
York, informs Judge Gonzalez that EPMI and Conectiv entered into
a Master Power Purchase and Sale Agreement on August 31, 2001.
Pursuant to the Master Agreement, the Parties could engage in
subsequent individual Transactions to buy or sell wholesale
electric power at a specified price and for a fixed term.

The Master Agreement provides a list of Events of Default,
including, inter alia:

     (i) the failure to make, when due, any payment required
         pursuant to the Master Agreement if the failure is not
         remedied within three business days after written notice
         of the failure;

    (ii) the failure to perform any covenant set forth in the
         Master Agreement; and

   (iii) the bankruptcy of a Party.

If one Party's conduct triggers an Event of Default, the Master
Agreement provides that if an Event of Default occurs at any
time during the term of the Master Agreement, the Non-Defaulting
Party may, for so long as the Event of Default is continuing,
designate an Early Termination Date on which all Transactions
will terminate.  When an Early Termination Date has been
designated, one party owes the other a Termination Payment.  The
Termination Payment is determined by calculating a Settlement
Amount for each Terminated Transaction and netting all
Settlement Amounts together with other amounts due under the
Master Agreement.  In addition, interest at the Interest Rate is
owed on the Termination Payment.

On December 3, 2001, in light of EPMI's bankruptcy filing,
Conectiv sent a letter to EPMI stating that it was suspending
further performance under the Master Agreement.  The letter
also advised EPMI that it was in default of the Master Agreement
and, thus, Conectiv was terminating the Agreement and
designating December 5, 2001 as the Early Termination Date.

Pursuant to its letter dated December 10, 2001, Conectiv
acknowledged that a Termination Payment was due EPMI.  However,
Mr. Dicther notes that in calculating the Termination Payment,
Conectiv invoked the Master Agreement's set-off provision, which
purports to allow Conectiv to set off amounts owed to EPMI under
the Master Agreement against the amounts an affiliate of EPMI
allegedly owes Conectiv under separate agreements.

Mr. Dicther asserts that the set-off provision in the Master
Agreement purporting to allow for the non-mutual set-off of
debts is invalid and unenforceable pursuant to Section 553 of
the Bankruptcy Code.  This provision is also invalid and
unenforceable because EPMI's affiliates are not signatories to
the Master Agreement.  By improperly relying on the set-off
provision of the Master Agreement, Mr. Dicther argues,
Conectiv's calculation of the Termination Payment was
approximately $8,000,000 less than the amount actually owed EPMI
in connection with the Early Termination of the Master
Agreement.

Pursuant to a letter dated July 31, 2002, EPMI advised Conectiv
of the accurate amount of the Termination Payment, and made a
formal demand for payment of the Termination Payment.  But Mr.
Dicther notes that as of January 31, 2003, Conectiv has failed
and refused to pay EPMI the Termination Payment.

Thus, EPMI asks the Court to:

     (a) since the Termination Payment of $11,744,744, together
         with interest, is a matured debt owed to EPMI, and is
         property of the estate, compel Conectiv to turnover the
         estate's property to EPMI, pursuant to Section 542(b) of
         the Bankruptcy Code;

     (b) declare that Conectiv violated the automatic stay
         provided for by Section 362 of the Bankruptcy Code when
         it exercised control over property of the estate by
         wrongfully suspending performance required of it under
         the Master Agreement and by withholding property under
         the Master Agreement;

     (c) declare that Conectiv breached the Master Agreement that
         caused EPMI damages in the amount of at least
         $11,744,744, plus interest and attorneys' fees;

     (d) declare that EPMI and its creditors have suffered
         substantial damages in an amount to be proven at trial
         due to Conectiv's unjust enrichment;

     (e) declare that non-mutual set-off rights created by the
         Master Agreement is unenforceable pursuant to Section
         553(a) of the Bankruptcy Code; and

     (f) declare that the Master Agreement's arbitration
         provision should not be enforced as EPMI's claims
         against Conectiv implicates numerous substantive core
         Bankruptcy Code issues. (Enron Bankruptcy News, Issue
         No. 61; Bankruptcy Creditors' Service, Inc., 609/392-
         0900)


FANSTEEL: Seeks to Stretch Lease Decision Period through July 10
----------------------------------------------------------------
Fansteel Inc., and its debtor-affiliates want to stretch the
time period within which they must decide whether to assume,
assume and assign, or reject their unexpired nonresidential real
property leases.  The Debtors tell the U.S. Bankruptcy Court for
the District of Delaware that they will need until July 10, 2003
to finalize their lease-related decisions.

The Debtors report that since the Petition Date, management and
the company's professionals have concentrated their time on,
among other things:

      -- obtaining DIP financing;

      -- working on a decommissioning plan for the Muskogee
         facility;

      -- marketing assets;

      -- resolving issued relates to retention of professionals;

      -- maintaining and improving operations; and

      -- heavily engaged in litigation.

Additionally, the Debtors relate that they are currently
formulating a plan of reorganization, aiming to have the plan
consensually adopted by the Official Committee of Unsecured
Creditors and the Nuclear Regulatory Commission. The Debtors
contend that until the plan is formulated, it is premature for
the Debtors to decide whether or not to assume and assign of
reject its real property leases.

Fansteel Inc., and eight affiliates filed for chapter 11
protection on January 15, 2002 (Bankr. Del. Case No. 02-10109).
Laura Davis Jones, Esq., at Pachulski, Stang, Ziehl Young &
Jones & Weintraub, P.C., represents the specialty metal
manufacturer of engineered metal components and tungsten carbide
products.  When Fansteel filed for chapter 11 protection it
reported $64,805,176 in assets and $91,585,665 in liabilities.


FEDERAL-MOGUL: Has Until April 21 to File Disclosure Statement
--------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware's Judge
Newsome extends Federal-Mogul Corporation and its debtor-
affiliates' time to file a disclosure statement with respect to
the Joint Reorganization Plan to and including April 21, 2003
and the Debtors' exclusive period to solicit plan acceptances
through August 11, 2003. (Federal-Mogul Bankruptcy News, Issue
No. 35; Bankruptcy Creditors' Service, Inc., 609/392-0900)


FLEMING COS.: $76 Million Critical Vendor from Kmart was Wrong
--------------------------------------------------------------
The Honorable John F. Grady sitting in the U.S. District Court
for the Northern District of Illinois finds that Judge
Sonderby's orders authorizing payment of approximately $300
million to Kmart's Critical Vendors for their prepetition claims
were contrary to bankruptcy law and should be reversed.
Approximately $76 million of that went to Fleming on account of
its prepetition claim against Kmart.

Kmart did its best to argue that Capital Factor's appeal is moot
because the payments have already been made.  Judge Grady
rejects that and tells Judge Sonderby to issue an order
directing recipients of Critical Vendor Payments like Fleming to
return the money to Kmart's estates.

The Bankruptcy Code "does not carve out priority or
administrative expense status for prepetition general unsecured
claims based on the 'critical' or 'integral' status of a
creditor," Judge Grady says, explaining that the effect is to
elevate the claims of select unsecured creditors and
subordinating all other unsecured claims.  Judge Grady finds
that Judge Sonderby improperly altered the statutory priority
scheme codified at 11 U.S.C. Secs. 503 and 507.

Judge Grady recognizes that invoking the so-called doctrine of
necessity "is well-intended and may even have some beneficial
results" in Kmart's cases.  "Nevertheless, it is clear that
however useful and practical these payments may appear to
bankruptcy courts, they simply are not authorized by the
Bankruptcy Code."  Until Congress codifies the doctrine of
necessity, Judge Grady opines, pre-plan payments of pre-petition
unsecured claims are illegal.

"[I]t is not too late to order that the monies paid be
returned," Judge Grady says.  Judge Grady doesn't buy the
Debtors' "doomsday speculation" that undoing the bankruptcy
court's orders would paralyze Kmart by forcing it to undergo the
Herculean task of immediately commencing thousands of lawsuits
to collect hundreds of millions of dollars from thousands of
vendors.  It is not evident to the District Court that Kmart
would have to sue anyone to recover the payments.  The District
Court suggests an order from Judge Sonderby directing the return
of the monies paid will be sufficient.

Kmart Corporation and its debtor-affiliates delivered their
Notice of Appeal to the U.S. District Court for the Northern
District of Illinois indicating their intention to seek review
of Judge Grady's order reversing Judge Sonderby's orders
allowing payment of pre-petition claims owed to Kmart's Critical
Vendors, Foreign Vendors, Liquor Vendors and to JPMorgan on
account of letter of credit reimbursement obligations.


FLEMING COS.: Wants to Honor Open Prepetition Purchase Orders
-------------------------------------------------------------
As a consequence of their Chapter 11 filing, Fleming Companies,
Inc., and its debtor-affiliates believe that many of their
vendors and suppliers may have become concerned that the
postpetition delivery of goods subject to prepetition purchase
orders will render the Suppliers prepetition general unsecured
creditors of the Debtors' estates.  The Suppliers may refuse to
deliver the goods unless and until the Debtors issue substitute
purchase orders or obtain a Court order granting administrative
expense status to those goods delivered postpetition.

As of the Petition Date, the Debtors had several purchase orders
outstanding with the Suppliers for the goods necessary to their
operations.  In the ordinary course of their businesses, the
Suppliers provide goods, including consumable goods, health and
beauty products, and general merchandise products, essential to
the Debtors' business operations.

The Debtors believe that the Outstanding Orders aggregate up to
$215,000,000 for various goods.  The Debtors intend to pay their
obligations to the Suppliers in the ordinary course of business
to ensure a continuous supply of goods.  The goods are
indispensable to the Debtors' continuing operations and integral
to a successful reorganization.

Pursuant to Section 503(b)(1)(A) of the Bankruptcy Code, the
purchase obligations that arise in connection with the
postpetition delivery to, and acceptance by, the Debtors of
goods, including those goods that are ordered prepetition, are
in fact, administrative expense priority claims.  Therefore, the
Debtors note that granting administrative expense priority
status to the Suppliers' deliveries will not provide the
Suppliers with any greater priority.

But without the Court order, the Debtors point out that they may
need to expend substantial time and effort reissuing the
numerous Outstanding Orders to assure that the Suppliers will be
given administrative expense priority.  The Debtors assert that
the attendant disruption to the continuous and timely flow of
goods used in their businesses could result in insufficient
supply and materials to adequately conduct their operations.
This could be detrimental at this critical juncture in the
Debtors' efforts to successfully reorganize.

At the Debtors' request, Judge Walrath grants administrative
expense priority status to the Debtors' Outstanding Orders in
accordance with Bankruptcy Code Section 503(b)(1)(A).  Judge
Walrath also authorizes the Debtors to pay all Outstanding
Orders in the ordinary course of business consistent with their
customary practices in effect before the Petition Date. (Fleming
Bankruptcy News, Issue No. 2; Bankruptcy Creditors' Service,
Inc., 609/392-0900)

Fleming Companies Inc.'s 10.625% bonds due 2007 (FLM07USR1),
DebtTraders says, are trading at 1.5 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=FLM07USR1for
real-time bond pricing.


GENEVA STEEL: Hiring CH2M Hill as Environmental Consultant
----------------------------------------------------------
Geneva Steel LLC seeks approval from the U.S. Bankruptcy Court
for the District of Utah to employ CH2M Hill as its
Environmental Consultant.  CH2M Hill will provide
environmentally-related evaluation services in order to assist
the Debtor in determining the extent of contamination on the
Debtor's property. Those services will require CH2M Hill to:

      a) evaluate existing data regarding contamination on the
         Debtor's properly and determine where data gaps exist;

      b) evaluate data front findings to help estimate the
         magnitude of cleanup costs;

      c) prepare a PRTS Preliminary Analysis Summary Report for
         the Debtor which outlines findings;

      d) examine and evaluate options for the use or reuse of
         property depending on the level of cleanup; and

      e) perform other environmentally-related estimation
         services as specifically requested by the Debtor.

The Debtor points out that CH2M Hill's evaluation of the scope
of environmental contamination on its property is a vital step
in preparation for marketing the its real property.

CH2M Hill estimates that the effort to complete its preliminary
PRTS analysis will take approximately four weeks. The Debtor
agrees to pay CH2M Hill a total of $35,000 for the PRTS
analysis.

Geneva Steel owns and operates an integrated steel mill located
near Provo, Utah. The Company filed for chapter 11 protection on
January 25, 2002 (Bankr. Utah Case No. 02-21455). Andrew A.
Kress, Esq., Keith R. Murphy, Esq., and Stephen E. Garcia, Esq.,
at Kaye Scholer LLP represent the Debtor in its restructuring
efforts. When the Company filed for protection from its
creditors, it listed $264,440,000 in total assets and
$192,875,000 in total debts.


GLOBAL CROSSING: Court Approves Settlement Pact with Accenture
--------------------------------------------------------------
Global Crossing Ltd., and its debtor-affiliates sought and
obtained Judge Gerber's approval for their Settlement Agreement
with Accenture LLP, which includes the assumption of certain
underlying agreements between the parties.

Michael F. Walsh, Esq., at Weil Gotshal & Manges LLP, in New
York, informed the Court that Accenture LLP has completed a very
significant consulting and software customization project for
the GX Debtors.  Accenture began the work before the Petition
Date and completed the project in March 2002.  Two disputes have
arisen under the agreements concerning:

     -- what portion of the work performed is attributable to the
        postpetition period; and

     -- whether Accenture holds intellectual property rights that
        the GX Debtors need to continue to benefit from the work
        performed.

The GX Debtors and Accenture have resolved those issues recently
and have agreed to a settlement of amounts due under the
Agreements dated November 22, 2002.  The salient terms of the
Settlement Agreement are:

     A. The Debtors will make these payments:

        -- $1,000,000 to Accenture without further delay; and

        -- $3,800,000, payable at the Debtors' option in the
           ordinary course of their business, from any
           administrative claim or reserve established under the
           Plan of Reorganization, or as an assumed liability of
           the Reorganized Debtors, in eight monthly installments
           of $475,000;

     B. Accenture will have a single allowed administrative
        expense claim against the Debtors in an aggregate amount
        not to exceed the Settlement Payments.  Accenture will
        not be required to file any proof of claim in the
        Debtors' Chapter 11 cases;

     C. The Debtors will assume the Agreements.  The Debtors are
        not required to make any cure payments in connection with
        the Assumption;

     D. The assumption and payments will result in a transfer of
        the IP Rights to the Debtors;

     E. During calendar years 2003 and 2004, the Debtors will
        grant Accenture a right to bid on formal requests for
        proposals with respect to systems development projects,
        which the Debtors wish to pursue.  If, in the  Debtors'
        sole and absolute discretion, Accenture's bid is equal to
        or superior than any other bids in all material respects,
        Accenture will be deemed a "Preferred Vendor" and the
        Debtors will negotiate in good faith with Accenture for
        these Services.  The Debtors reserve the right to elect
        not to secure the applicable Services from Accenture or
        any other party; and

     F. The Debtors and Accenture exchange mutual releases,
        provided, however, that these releases will not affect
        obligations expressly preserved by or contained in the
        Settlement Agreement. (Global Crossing Bankruptcy News,
        Issue No. 37; Bankruptcy Creditors' Service, Inc.,
        609/392-0900)


GOODYEAR TIRE: S&P Cuts & Plucks B+ Class A-1 Rating from Watch
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on
Corporate Backed Trust Certificates Goodyear Tire & Rubber Note-
Backed Series 2001-34 Trust's class A-1 certificates and removed
it from CreditWatch with negative implications, where it was
placed March 10, 2003.

The rating action follows the April 2, 2003 lowering of Goodyear
Tire & Rubber Co.'s long-term corporate credit and senior
unsecured debt ratings and their removal from CreditWatch.

Corporate Backed Trust Certificates Goodyear Tire & Rubber Note-
Backed Series 2001-34 Trust is a swap-independent synthetic
transaction that is weak-linked to the underlying collateral,
Goodyear Tire & Rubber Co.'s debt. The rating action reflects
the credit quality of the underlying securities issued by
Goodyear Tire & Rubber Co.

       RATING LOWERED AND REMOVED FROM CREDITWATCH NEGATIVE

  Corporate Backed Trust Certificates Goodyear Tire & Rubber
        Note-Backed Series 2001-34 Trust $43.628 million
                   corporate bond-backed certs

                          Rating
             Class     To         From
             A-1       B+         BB-/Watch Neg

DebtTraders says that Goodyear Tire & Rubber's 8.500% Bond Due
GT07USR1 2007 (GT07USR1) are trading at 74 cents-on-the-dollar.
See http://www.debttraders.com/price.cfm?dt_sec_ticker=GT07USR1
for real-time bond pricing.


HAWAIIAN AIRLINES: Wants to Engage Dow Lohnes as Special Counsel
----------------------------------------------------------------
Hawaiian Airlines, Inc., asks for approval from the U.S.
Bankruptcy Court for the District of Hawaii to employ Dow,
Lohnes & Albertson, PLLC as Special Counsel to provide legal
services related to:

      i) the Debtor's certificate of public convenience and
         necessity issued by the United States Department of
         Transportation, and its operating certificate issued by
         the Federal Aviation Administration;

     ii) governmental and legislative issues arising from acts of
         regulatory agencies and the Congress of the United
         States of America; and

    iii) intellectual property issues arising from the ownership
         of trade marks and copyrighted materials.

The Debtor relates that Dow Lohnes has represented the Debtor on
transportation and aviation law issues since 1979.  As a result,
Dow Lohnes gained intimated familiarity with the complex legal
issued that have arisen and are likely to arise in connection
with the Debtor's transportation and aviation issues.

Dow Lohnes' current hourly rates range from:

      Partners and Counsel          $330 to $450 per hour
      Associates/Senior Counsel     $160 to $375 per hour
      Paralegals/Legal Assistants   $40 to $225 per hour

Hawaiian Airlines Incorporated provides primarily scheduled
transportation of passengers, cargo and mail. Flights operate
within the South Pacific and to points on the west coast as well
as Las Vegas.  The Company filed for chapter 11 protection on
March 21, 2003 (Bankr. Hawaii Case No. 03-00817).  Lisa G.
Beckerman, Esq., at Akin Gump Strauss Hauer & Feld LLP represent
the Debtor in its restructuring efforts.  When the Company filed
for protection from its creditors, it listed debts and assets of
more than $100 million each.


HEALTHSOUTH CORP: Bank Lenders Agree to Forbear Until May 1
-----------------------------------------------------------
HEALTHSOUTH Corporation (OTC Pink Sheets: HLSH) and its bank
lenders have executed a Forbearance Agreement on the Company's
$1.25 billion credit facility through May 1, 2003.

The agreement provides that the bank lending group, headed by
JPMorgan Chase Bank and Wachovia Securities, will forbear from
exercising remedies arising from the default of the Company's
credit facility, which was announced on March 27, 2003, absent
any new defaults under the credit facility or the Forbearance
Agreement. During this forbearance period, the Company will
continue discussions with its creditors to address the Company's
current liquidity situation.

HEALTHSOUTH is the nation's largest provider of outpatient
surgery, diagnostic imaging and rehabilitative healthcare
services, with nearly 1,700 locations in all 50 states, the
United Kingdom, Australia, Puerto Rico, Saudi Arabia and Canada.
HEALTHSOUTH can be found on the Web at
http://www.HEALTHSOUTH.com

Healthsouth Corp.'s 7.375% bonds due 2006 (HRC06USN1) are
trading between 51.5 and 53.5. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=HRC06USN1for
real-time bond pricing.


HEARTLAND SECURITIES: Committee Taps Cole Schotz as Attorneys
-------------------------------------------------------------
The Official Committee of Unsecured Creditors of Heartland
Securities Corp., asks for authority from the U.S. Bankruptcy
Court for the Southern District of New York to retain Cole,
Schotz, Meisel, Forman & Leonard, P.A., as its counsel.

The Committee tells the Court that it needs to retain Cole
Schotz in this proceeding to:

      a) give the Committee legal advice with respect to its
         duties and powers;

      b) assist the Committee in its investigation of the acts,
         conduct, assets, liabilities, and financial condition of
         the Debtor and the operation of its business and the
         desirability of the continuation of such business, as
         well as any other matters relevant to the case or to the
         formulation of a plan of reorganization or orderly
         liquidation, including the examination of the Debtor's
         transactions with its secured creditors, former and
         present shareholders, and management;

      c) represent the Committee in any adversary proceedings,
         including, but not limited to, those commenced by or
         against the Committee and to represent the Committee in
         any court proceedings commenced by or against it in any
         other courts of competent jurisdiction; and

      d) perform all legal services for the Committee as may be
         necessary herein.

Cole Schotz will charge the Debtor's estates at their standard
hourly rates, which currently are:

      Hugh M. Leonard      Partner      $450 per hour
      Gerald H. Gline      Partner      $425 per hour
      Michael D. Sirota    Partner      $425 per hour
      Stuart Komrower      Partner      $375 per hour
      Leo V. Leyva         Partner      $375 per hour
      Leonard M. Wolf      Partner      $350 per hour
      Ilana Volkov         Partner      $325 per hour
      Warren A. Usatine    Partner      $285 per hour
      Kenneth L. Baum      Partner      $275 per hour
      Franck D. Chantayan  Associate    $175 per hour
      Jarod M. Stern       Associate    $150 per hour
      Kristin S. Elliot    Associate    $125 per hour
      Alexander R. Perez   Associate    $125 per hour
      Virginia M. Lane     Paralegal    $125 per hour
      Frances Pisano       Paralegal    $125 per hour

Heartland Securities Corp., provider securities brokerage
services for professional day traders, filed for chapter 11
protection on March 26, 2003 (Bankr. S.D.N.Y. Case No. 03-
11817).  Thomas R. Califano, Esq., at Piper Marbury Rudnick &
Wolfe LLP, represents the Debtors in their restructuring
efforts.  When the Company filed for protection from its
creditors, it listed $13,386,000 in total assets and $25,833,000
in total debts.


HOLLINGER INC: Dec. 31 Balance Sheet Insolvency Widens to $351MM
----------------------------------------------------------------
Hollinger Inc., (TSX:HLG.C) reports a net loss for the year
ended December 31, 2002 of $88.6 million compared to a net loss
of $131.9 million in 2001. The net loss for the three months
ended December 31, 2002 was $54.4 million compared to a net loss
of $82.8 million in 2001. The results of both years have been
impacted by a large number of unusual items that are discussed
later in this release.

Hollinger Inc.'s principal asset is its shareholding in
Hollinger International Inc. (NYSE:HLR) that currently
represents approximately 72.6% of the voting power and
approximately 30.3% of the equity of the outstanding common
stock of International. International's operations consist
principally of the Chicago Group, the U.K. Newspaper Group, the
Canadian Newspaper Group and the Community Group (now consisting
only of the Jerusalem Post).

                          Sales Revenue

Sales revenue in 2002 was $1,628.2 million compared with
$1,822.1 million in 2001, a decrease of $193.9 million. The
reduction in sales revenue is primarily due to the sale of most
of the remaining Canadian newspaper properties in July and
November 2001 and the sale of the remaining 50% interest in the
National Post in August 2001. Declines in U.K. advertising
revenue in local currency for the full year, were partially
offset by the strengthening of the pound sterling. Sales
revenue, in local currency, for the Chicago Group was flat year
over year.

Sales revenue in the three months ended December 31, 2002 was
$417.1 million compared with $408.1 million in 2001, an increase
of $9.0 million. Increased sales revenue at the Chicago Group
and the U.K. Newspaper Group were partly offset by lower sales
revenue at the Jerusalem Post and at the Canadian Newspaper
Group. U.K Newspaper Group revenue in local currency decreased,
as a result of lower joint venture printing revenue offset in
part by increased fourth quarter advertising revenue. However,
as a result of the strengthening of the pound sterling, U.K
Newspaper Group revenue increased in Canadian dollars. Chicago
Group revenue in local currency increased as a result of
increased advertising revenue partly offset by lower circulation
revenue.

                     Cost of Sales and Expenses

Cost of sales and expenses in the full year 2002 were $1,453.9
million compared with $1,730.1 million in 2001, a decrease of
$276.2 million. The decrease in cost of sales and expenses
resulted primarily from the disposition of Canadian newspaper
properties in 2001 as well as lower newsprint costs, lower
compensation costs and general cost reductions at the Chicago
Group and the U.K. Newspaper Group, primarily as a result of
cost containment strategies. Lower cost of sales and expenses at
the U.K. Newspaper Group, in local currency, were partially
offset by the effect of the strengthening of the pound sterling.

Cost of sales and expenses in the fourth quarter 2002 were
$375.2 million compared with $399.9 million in 2001, a decrease
of $24.7 million primarily at the U.K. Newspaper Group and the
Chicago Group. Cost of sales and expenses in the U.K. Newspaper
Group in the fourth quarter 2001 included an impairment charge
in respect of betterments capitalized which accounted for most
of the decrease in the U.K. Newspaper Group in the fourth
quarter 2002 compared with 2001.

                   Depreciation and Amortization

Depreciation and amortization in the full year 2002 amounted to
$88.2 million compared with $144.7 million in 2001, a reduction
of $56.5 million. In the fourth quarter 2002, depreciation and
amortization amounted to $21.2 million compared with $33.8
million in 2001, a reduction of $12.6 million. These reductions
primarily result from both the disposition of Canadian
properties in 2001 and the adoption on January 1, 2002 of CICA
Handbook Section 3062, which resulted in goodwill not being
amortized subsequent to January 1, 2002. In the year ended
December 31, 2001, amortization of goodwill and intangible
assets, including amortization of goodwill and intangible assets
in respect of properties sold during 2001, which are not being
amortized in 2002, approximated $53.3 million.

                   Investment and Other Income

Investment and other income in the full year 2002 amounted to
$29.7 million compared with $97.3 million in 2001, a decrease of
$67.6 million, and for the fourth quarter 2002 amounted to $7.1
million compared with $0.4 million in 2001, an increase of $6.7
million. Investment and other income in 2001 included interest
on debentures issued by a subsidiary of CanWest Global
Communications Corp., and a dividend on CanWest shares. In
September 2001, CanWest temporarily suspended its semi-annual
dividend. In the latter part of 2001, all of the CanWest shares
were sold to the Hollinger Participation Trust and participation
interests were sold in respect of nearly all of the CanWest
debentures, resulting in significantly lower interest and
dividend income in 2002. Most of the proceeds from the disposal
of the CanWest investments were retained as short-term
investments at low rates of interest until the end of the first
quarter of 2002 when a portion of International's long-term debt
was retired.

                        Interest Expense

Interest expense for 2002 was $121.7 million compared with
$177.9 million in 2001, a reduction of $56.2 million, and for
the fourth quarter 2002 was $32.3 million compared with $40.9
million in 2001. These reductions mainly result from lower
average debt levels in 2002 compared with 2001. The Company
reduced its senior credit facility in 2001 by $173.4 million and
by $38.5 million in January 2002 and International reduced its
long-term debt beginning in March 2002 by U.S. $290.0 million.
In addition, since both the Company's Series II and Series III
preference shares are financial liabilities, dividends on such
shares are included in interest expense. Dividends paid on the
Series II preference shares were lower in 2002 than in 2001, as
a result of Series II preference share retractions and
International reducing its dividend on Class A common shares, on
which the Series II preference dividends are based.

                     Net Foreign Currency Loss

Net foreign currency losses increased to a loss of $19.7 million
in the year ended December 31, 2002 from a loss of $7.5 million
in 2001. Net foreign currency losses in 2002 includes a $10.4
million net loss on amounts sold to the Hollinger Participation
Trust and a loss on a cross currency swap of $5.7 million. Net
foreign currency losses in the fourth quarter 2002 were $16.5
million compared to $3.9 million in 2001.

                           Unusual Items

Unusual items in the full year 2002 amounted to a loss of $62.6
million compared with a loss of $295.4 million in 2001. Unusual
items in 2002 included the loss on retirement of senior notes of
Internationals' subsidiary, Hollinger International Publishing
Inc. (Publishing), in the amount of $56.3 million, a $63.6
million write-off of investments, and a $43.3 million loss on
the termination of the Total Return Equity Swap, partly reduced
by a $20.1 million gain on the dilution of the Company's
investment in International, a net $44.5 million foreign
exchange gain on the reduction of net investments in foreign
subsidiaries and a $34.4 million reduction of the pension
valuation allowance. Unusual items in 2001 included a $240.1
million loss on sale of investments, a $23.0 million loss on
sale of Publishing interests, a $79.9 million loss on write-off
of investments and a $29.6 million realized loss on the Total
Return Equity Swap partly offset by a $59.4 million gain on the
sale of and dilution of the Company's investment in
International and a $58.7 million reduction of the pension
valuation allowance.

Unusual items in the fourth quarter of 2002 were a gain of $5.0
million compared to a loss of $198.4 million in the fourth
quarter of 2001. Unusual items in the fourth quarter 2002
included a write-off of investments, a decrease in the pension
valuation allowance, a realized loss on the Total Return Equity
Swap and a net foreign exchange gain on the reduction of the net
investment in the Canadian Group. Unusual items in the fourth
quarter of 2001 included gains and losses on the sale of certain
Canadian properties, a gain on the dilution of the investment in
International, gains and losses on the sales of investments, a
one-time expense related to the pension and post retirement plan
liability adjustment in respect of retired former Southam
employees and a decrease in pension valuation allowance.

                        Income Tax Expense

In 2002 income tax expense for the full year was $124.0 million
computed on a loss before income taxes and minority interest of
$89.5 million primarily as a result of non-deductible expenses
including the settlement of the Total Return Equity Swap and an
increase in the tax valuation allowance of $74.0 million. For
the full year 2001, the income tax recovery was $89.5 million on
a loss before income taxes and minority interest of $454.9
million in part due to the impact of losses at the National Post
for which a tax benefit was not recorded.

                        Minority Interest

Minority interest in the year ended December 31, 2002 was a
recovery of $124.9 million compared to a recovery of $233.5
million in 2001 and for the fourth quarter 2002 was a recovery
of $99.2 million compared to a recovery of $179.9 million in
2001. Minority interest primarily represents the minority share
of the net loss of International and the net earnings of
Hollinger Canadian Newspapers, Limited Partnership. In 2001,
minority interest also included the minority's 50% share of the
National Post net loss to August 31, which totalled $28.7
million.

      Refinancing of the Company's Bank and Other Indebtedness

On March 10, 2003, Hollinger Inc. issued U.S. $120.0 million
aggregate principal amount of 11-7/8% Senior Secured Notes due
2011. The total net proceeds were used to repay existing bank
indebtedness of $90.8 million, to repay amounts due to the
Company's ultimate parent company, The Ravelston Corporation
Limited (RCL), of $48.8 million, to make advances to RCL of
$16.4 million and for general corporate purposes. The Senior
Secured Notes are secured by a first priority lien on 10,108,302
shares of International's Class A common stock and 14,990,000
shares of International's Class B common stock owned by the
Company and a wholly owned subsidiary. Therefore the Company,
directly and indirectly, in total holds only 1,380,529 shares of
International Class A common stock which are unencumbered, the
current market value of which is approximately $16.7 million.

Immediately prior to the issue of Senior Secured Notes, a wholly
owned subsidiary of the Company owed International approximately
U.S.$46.2 million on a demand basis. Contemporaneously with the
issue, International purchased for cancellation 2,000,000 shares
of Class A common stock held by the Company's subsidiary, and
redeemed all the Series E Redeemable Convertible Preferred Stock
of Hollinger International held by the Company's subsidiary,
thereby reducing the amount owing to U.S.$20.4 million.

The remaining debt bears interest at 14.25% (or 16.5% in the
event that the interest is paid in kind) and is subordinated to
the Company's Senior Secured Notes (so long as the notes are
outstanding).

                   Cash Flow and Liquidity

On a non-consolidated basis, the Company has experienced a
shortfall between the dividends and fees received from its
subsidiaries and its obligations to pay its operating costs,
including interest on its debt and dividends on its preference
shares. Such shortfalls have been funded by RCL and Ravelston
Management Inc. (RMI) on an informal basis. On March 10, 2003,
the date of issue of the Company's Senior Secured Notes, RMI
entered into a support agreement with the Company. Under the
agreement, RMI is required to make an annual support payment in
cash to the Company on a periodic basis by way of contributions
to the capital of the Company (without the issuance of
additional shares of the Company) or subordinated debt. The
annual support payment will be equal to the greater of (a) the
Company's negative net cash flow for the relevant period (which
does not extend to outlays for retractions or redemptions),
determined on a non-consolidated basis, and (b) U.S.$14.0
million per year (subject to certain reductions), in either case
as reduced by any permanent repayment of debt owing by RCL to
the Company.

The Company's issued capital stock consists of Series II
preference shares, Series III preference shares and retractable
common shares, each of which is retractable at any time at the
option of the holder. There is uncertainty regarding the
Company's ability to meet its future financial obligations
arising from the retraction of preference shares and retractable
common shares. Under corporate law, the Company is not required
to make any payment to redeem any shares in certain
circumstances, including if the Company's liquidity would be
unduly impaired as a consequence. If, when shares are submitted
by holders for retraction or when the Company is obliged to
redeem the Series III shares on April 30, 2004, there are
reasonable grounds for believing that, after making payment in
respect of those shares, the Company's liquidity would be unduly
impaired, the retractions and redemptions will not be completed.
In such event, shareholders would not become creditors of the
Company but would remain as shareholders until such time as the
retractions or redemptions are able to be completed under
applicable law.

The Company's uncertain ability to make payments on future
retractions and redemptions of shares is due to the fact that
liquidity of its assets is limited at present given that
substantially all of its shares of International common stock
were provided as security for the Senior Secured Notes.

The Company's Series III preference shares are redeemable on
April 30, 2004 for a cash payment of $10.00 per share plus any
accrued and unpaid dividends to that date. The total cost to
redeem all of the issued and outstanding Series III preference
shares is $101.5 million. The Company is proposing to make an
offer to exchange all of its Series III Preference Shares for
newly issued Series IV Preference Shares having comparable terms
except for a higher dividend rate (8% as compared to 7% for the
Series III Preference Shares) and a longer term to mandatory
redemption (April 30, 2008 as compared to April 30, 2004).

At December 31, 2002, the Company's balance sheet shows a total
shareholders' equity deficit of about $351 million.

                          Long-term Debt

At December 31, 2002, the Company's consolidated long-term debt
totalled $974.8 million and was all debt of International and
its subsidiaries. In December 2002, Publishing completed the
private placement of U.S.$300.0 million of 9% senior notes ("9%
Senior Notes") due 2010 generating net proceeds of U.S.$291.7
million before expenses associated with the offering.
Contemporaneously with that placement, Publishing closed an
amended U.S.$310.0 million senior secured credit facility
consisting of a U.S.$45.0 million revolving credit facility and
a U.S.$45.0 million term loan both maturing September 30, 2008
as well as a U.S.$220.0 million term loan maturing September 30,
2009. No amounts have been drawn under the U.S.$45.0 million
revolving credit facility. The proceeds from the 9% Senior Note
offering and U.S.$265.0 million borrowed as term loans under the
senior secured credit facility, along with cash on hand, were
used, in part, to repay all amounts owed by International under
its loan facility with Trilon International Inc., to retire the
remaining Total Return Equity Swaps, thus canceling seven
million shares of Class A common stock, and on January 22, 2003,
to redeem the existing senior subordinated notes of Publishing
due 2006 and 2007 in the amount of U.S$543.8 million, including
early redemption premium and accrued interest. This debt is
shown as a current liability at December 31, 2002 and the
borrowings used to fund the redemption were held in escrow at
December 31, 2002 and disclosed as escrow deposits in current
assets.

                 Transitional Impairment Charge

The transitional provisions of CICA Handbook section 3062
required the Company to assess whether goodwill was impaired as
of January 1, 2002. As a result of this transitional impairment
evaluation, the Company determined that the carrying amount of
the Jerusalem Post properties was in excess of the properties'
estimated fair value. Accordingly, the value of goodwill
attributable to the Jerusalem Post of $32.0 million has been
written down in its entirety. The net write-down of $12.1
million (net of related minority interest) has been recorded as
a charge to the opening deficit as at January 1, 2002.

              Restatement of 2002 Quarterly Results

All of the Company's operations are owned through International
and substantially all of the Company's goodwill and intangible
assets are reflected in the accounts of International. Upon
initial adoption on January 1, 2002 of the new accounting
standards for goodwill and other intangible assets,
International classified $186.8 million of advertiser and
subscriber relationship intangible assets as goodwill. Also, on
initial adoption on January 1, 2002, the Company made a similar
reclassification to goodwill of such amounts which had been
included within circulation for the Chicago Group. However,
based on the consensus reached by the U.S. Emerging Issues Task
Force in Issue No. 02-17, "Recognition of Customer Relationship
Intangible Assets Acquired in a Business Combination" and a
comment made by the Securities and Exchange Commission in their
review of International's results for the nine months ended
September 30, 2002, International has subsequently concluded
that its advertiser and subscriber relationship intangible
assets do meet the criteria for recognition apart from goodwill
under SFAS No. 142 (which is substantially consistent with CICA
Handbook Section 3062). Therefore, in the accounts of both
International and the Company, the advertiser and subscriber
relationship intangible assets were reclassified from goodwill
to identifiable intangible assets during the fourth quarter of
2002 and continue to be amortized over their 30-year useful
lives.

Amortization expense was increased by $1,788,000, income tax
recovery was increased by approximately $715,000, minority
interest reduced by $727,000 and net loss was increased by
$346,000 for each of the three months ended March 31, June 30
and September 30, 2002 to reflect the adjustment to amortization
and related effects to income tax and minority interest.

The Company's reclassification of advertiser and subscriber
relationship intangible assets apart from goodwill had no impact
on the asset impairment tests and the Company's cumulative
effect of a change in accounting principle.

                            Other

Hollinger Inc.'s principal asset is its shareholding in
Hollinger International Inc. that currently represents
approximately 72.6% of the voting power and approximately 30.3%
of the equity of the outstanding common stock of Hollinger
International Inc.

Hollinger International Inc. is a global newspaper publisher
with English-language newspapers in the United States, Great
Britain, and Israel. Its assets include The Daily Telegraph, The
Sunday Telegraph and The Spectator magazine in Great Britain,
the Chicago Sun-Times and a large number of community newspapers
in the Chicago area, The Jerusalem Post and The International
Jerusalem Post in Israel, a portfolio of new media investments
and a variety of other assets.


HUGHES ELEC.: GM's Ratings Not Affected by Sale of Interests
------------------------------------------------------------
Standard & Poor's Ratings Services said that its rating and
outlook on General Motors Corp. (BBB/Negative/A-2) are not
affected by the company's announced plan to sell its remaining
19.9% economic ownership interest in Hughes Electronics Corp. to
News Corp. Ltd. The transaction would generate total proceeds of
approximately $4.1 billion (pretax) -- $3.4 billion in cash and
$700 million in News Corp. preferred American Depository
Receipts. In its decision announced yesterday to revise GM's
rating outlook to Negative from Stable, Standard & Poor's had
assumed that GM would ultimately succeed in its long-standing
efforts to monetize its investment in Hughes. Completion of
this transaction (which is subject to shareholder, tax, and
other regulatory approvals) will enhance GM's ability to meet
its near-term pension funding objectives. Yet, the massive size
of the company's unfunded pension liability ($25.4 billion at
Dec. 31, 2002) and even larger retiree medical liability ($51.4
billion) will still pose significant concerns.


IMCLONE SYSTEMS: Fails to Satisfy Nasdaq Listing Requirements
-------------------------------------------------------------
ImClone Systems Incorporated (Nasdaq: IMCL), as a result of the
delay in filing the Company's 2002 Form 10-K results and in
accordance with standard practice, received a Nasdaq Staff
Determination indicating the Company has failed to comply with
filing requirements with respect to Marketplace Rule
4310(C)(14).

As a result, the Company's securities are subject to delisting
from The Nasdaq National Market. As previously announced,
ImClone Systems delayed the filing of its 2002 Form 10-K based
on its inability to finalize the Company's audited financial
statements pending completion of an ongoing internal review.

In accordance with Nasdaq 4800 series rules, ImClone Systems
plans to promptly submit a request for a hearing before the
Nasdaq Listing Qualifications Panel to appeal the Nasdaq Staff
Determination and avoid a delisting of its securities. No
delisting action will take place prior to the hearing, which,
under Nasdaq regulation, is held within 45 days of the date of
the hearing request.

To the best of the Company's knowledge, there are no other
deficiencies, qualitative or quantitative, that would prevent
the Company's securities from continued listing on The Nasdaq
National Market. It is the Company's understanding that its
filing of its annual report on Form 10-K with the SEC will cure
the only outstanding Nasdaq continued listing deficiency and
will allow the Company's securities to regain compliance and
remain listed on the Nasdaq Stock Market. The Company intends to
cure the outstanding listing deficiency prior to a delisting
action.

As a result of ImClone Systems' inability to file its 2002 Form
10-K on a timely basis, the Company's trading symbol was changed
by Nasdaq from "IMCL" to "IMCLE" effective Friday, April 11,
2003, and will not revert to "IMCL" until such time as the
Company cures its listing deficiency by filing its 2002 Form 10-
K.

ImClone Systems Incorporated, whose September 30, 2002 balance
sheet shows a total shareholders' equity deficit of about $117
million, is committed to advancing oncology care by developing a
portfolio of targeted biologic treatments, designed to address
the medical needs of patients with cancer. The Company's three
programs include growth factor blockers, angiogenesis inhibitors
and cancer vaccines. ImClone Systems' strategy is to become a
fully integrated biopharmaceutical company, taking its
development programs from the research stage to the market.
ImClone Systems is headquartered in New York City with
additional administration, manufacturing and laboratory
facilities in Somerville, New Jersey and Brooklyn, New York.


INTEGRATED INFO.: Commences Trading on OTCBB Under IISX Symbol
--------------------------------------------------------------
Integrated Information Systems, Inc. (OTCBB:IISX), a leading
provider of secure integrated information solutions, reported
its second consecutive profitable quarter for the fourth quarter
ended December 31, 2002.

Net income for the quarter was $427,000 or $0.12 per share,
compared to a net loss of $12.4 million for its fourth quarter
ended December 31, 2001. Revenue for the quarter was $3.4
million, compared to revenue of $6.0 million for the fourth
quarter of 2001.

Net loss for the year 2002 was $11.8 million, compared to a net
loss of $49.4 million for the year 2001. Revenue for the year
2002 was $23.3 million, compared to revenue of $31.3 million for
the year 2001. The company's auditors issued an unqualified
opinion in connection with their audit of the financial
statements for 2002.

The Company's December 31, 2002 balance sheet shows that total
current liabilities exceeded its total current assets by about
$3 million. Meanwhile, the Company's total shareholders equity
has further diminished to about $600,000 from about $12 million
as recorded a year ago.

Some of the clients IIS worked with in the quarter include: ADM
Group, ADP, ADT Security Systems, Alliant Energy, American
Express, American Family Mutual Insurance, AnchorBank, Arizona
State University, Arizona Department of Public Safety, Benson
Industries, Blair Corporation, Boise Cascade, Buck Consultants,
City of Cupertino, City of Phoenix, City of Sacramento, City of
San Jose, City of Sausalito, City of Waukesha, Cox
Communications, CUNA Mutual Group, Dane County, Dell,
Diversified Healthcare, Hewlett Packard, Honeywell, IBM, JDA
Software, Johnson Controls, Johnsonville Sausage, Johnson Wax,
Kraft Foods, Maricopa Community College, Maricopa County,
Marshall Erdman, Novell Corporation, Farmers Insurance Group,
Partners Telemedicine, Phillip Morris, Rapid City Medical
Center, Qwest Communications, Rayovac, Reed PLC, The Nautilus
Group, Timberline Software, Tucson Medical Center, TriWest
Healthcare Alliance, Wausau-Mosinee Paper, Wisconsin Department
of Electronic Government, and Kenworth.

The work included new technology solutions that were focused on
helping our clients "do more with less." Some of the solutions
provided in the quarter include: server consolidation, messaging
migration, desktop and server operating system migration,
application integration, application development, security
assessment and implementation, directory services design and
implementation, secure remote access, single sign-on
integration, and data warehouse design and implementation

"We have continued to relentlessly pursue our turnaround plan,"
said Jim Garvey, Chairman, Chief Executive Officer and President
of IIS. "As part of our restructuring efforts, the third and
fourth quarters of 2002 were favorably impacted by downward
revisions to restructuring accruals and gains on the settlement
of payables for less than the face amount, totaling $5.2
million, further improving our balance sheet, significantly
reducing going-forward obligations, and enhancing our ability to
grow the business profitably. As we complete the financial
restructuring phases of our plan, which have allowed us to
report gains for two quarters, we will be directing our efforts
toward catching the next wave of technology spending and
restoring solid organic growth to our business. Web services
architecture and technology creates new integration
opportunities for organizations. We expect a coming wave of
inter-organization integration opportunities for our clients.
These opportunities provide a high return on investment for our
clients and can be completed with the latest technology in an
economical and incremental fashion. In addition, web services
provides for easy integration with existing systems so current
technology investments can be leveraged with less incremental
cost and time than complete system replacement or even
previously available integration technologies."

"The current economic environment has made near-term revenue
growth difficult and has lowered our expectations of what we
will be able to accomplish short-term," continued Garvey. "We
expect revenues to remain flat to down but feel confident that
we now have the right expense structure to weather this
environment while building for the future. We will carefully
continue our consolidation efforts this year around the
Microsoft Partner Channel and expect to close a number of
acquisitions that will open new markets for us during the year."

Effective with the opening of business on April 10, 2003, the
common stock of IIS commenced trading on the OTC Bulletin Board
(OTCBB) under the symbol "IISX". The common stock of IIS had
been trading on The Nasdaq SmallCap Market under the symbol
"IISXC" pursuant to a conditional listing granted in 2002. The
Nasdaq Listing Qualifications Panel determined that IIS did not
meet the minimum stockholders' equity requirement for the
conditional listing and, accordingly, determined not to permit
continued inclusion on The Nasdaq SmallCap Market.

Integrated Information Systems(TM) is a leading provider of
secure integrated information solutions. IIS specializes in
securely optimizing, enhancing and extending information
applications and networks to serve employees, partners,
customers and suppliers. IIS new technology solutions help
organizations do more with less. Founded in 1988, IIS has
operations in Denver; Madison; Milwaukee; Phoenix; Portland,
Oregon and Bangalore, India.

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


INTERNATIONAL PAPER: Will be Paying Regular Quarterly Dividend
--------------------------------------------------------------
International Paper (NYSE: IP) announced a regular quarterly
dividend of $0.25 per share for the period from April 1, 2003 to
June 30, 2003, inclusive.  The dividend on the common stock of
the company is payable June 16, 2003 to holders of record
at the close of business on May 23, 2003.

Also, the company declared a regular quarterly dividend of $1
per share for the period April 1, 2003 to June 30, 2003,
inclusive, on the preferred stock of the company, payable
June 16, 2003 to holders of record at the close of business on
May 23, 2003.

International Paper -- http://www.internationalpaper.com-- is
the world's largest paper and forest products company.
Businesses include paper, packaging, and forest products. As one
of the largest private forest landowners in the world, the
company manages its forests under the principles of the
Sustainable Forestry Initiative(R) (SFIsm) program, a system
that ensures the continual planting, growing and harvesting of
trees while protecting wildlife, plants, soil, air and water
quality.  Headquartered in the United States, International
Paper has operations in over 40 countries and sells its products
in more than 120 nations.

As previously reported, Standard & Poor's Ratings Services has
assigned its 'BB+' preferred stock ratings to International
Paper Co.'s $6 billion mixed shelf registration.


ISLE OF CAPRI: Names Barron Fuller VP & GM of Marquette Casino
--------------------------------------------------------------
Isle of Capri Casinos, Inc., (Nasdaq: ISLE) has promoted Barron
B. Fuller to vice president and general manager of the company's
Marquette casino.

Fuller, who most recently served as senior director of
operations for the Isle--Marquette, has been with the Isle of
Capri since the company acquired the property in 2000.  His
responsibilities will include overseeing the day-to-day
operations of the 19,000-square-foot casino and hotel.

Prior to his professional experience with the Isle of Capri,
Fuller held various positions with the Miss Marquette Riverboat
Casino since 1995.  He holds a bachelor's of science degree in
hotel and restaurant management from the University of
Wisconsin-Stout.

Isle of Capri Casinos, Inc. owns and operates 13 riverboat,
dockside and land-based casinos at 12 locations, including
Biloxi, Vicksburg, Lula and Natchez, Mississippi; Bossier City
and Lake Charles (two riverboats), Louisiana; Black Hawk,
Colorado; Bettendorf, Davenport and Marquette, Iowa; and Kansas
City and Boonville, Missouri.  The company also operates Pompano
Park Harness Racing Track in Pompano Beach, Florida.

As reported in Troubled Company Reporter's February 3, 2003
edition, Standard & Poor's Ratings Services assigned its 'B+'
rating to Isle of Capri Black Hawk LLC's $210 million senior
secured credit facility.

In addition, Standard & Poor's assigned its 'B+' corporate
credit rating to the Black Hawk, Colo.-based company. The
outlook is stable.

Isle of Capri Black Hawk is 57% owned by Isle of Capri Casinos
Inc., (BB-/Stable/--) and 43% by Nevada Gold & Casinos Inc.
(unrated entity). Upon consummation of the pending acquisition,
the company will own and operate two casino properties in Black
Hawk (Isle Black Hawk and Colorado Central Station; CCS) and one
in Cripple Creek, Colo. The $84 million transaction is expected
to close in the next several months, subject to regulatory
approval and financing.


J.CREW GROUP: Reports a Slight Decline in Revenues for March
------------------------------------------------------------
J.Crew Group, Inc., reported revenues for the five weeks ended
April 5, 2003 of $58.2 million compared to revenues of $58.9
million for the five weeks ended April 6, 2002.

Comparable store sales for the Retail division decreased 8% for
the five weeks ended April 5, 2003 compared to the same five
week period last year. Net sales for the Direct division were
flat for the comparable five week period.  Total inventories
were down 20% compared to last year, despite a 10% increase in
the store base versus a year ago.

Revenues for the nine weeks ended April 5, 2003 were $103.8
million compared to $112.3 million for the nine weeks ended
April 6, 2002, a decrease of 8%.  Comparable store sales for the
Retail division decreased 15% for the nine week period ended
April 5, 2003 compared to the comparable period last year.  Net
sales for the Direct division decreased 8% for the comparable
nine week period.

J.Crew Group, Inc., is a leading retailer of men's and women's
apparel, shoes and accessories.  As of April 5, 2003, the
Company operated 154 retail stores, the J.Crew catalog business,
jcrew.com, and 42 factory outlet stores.

                          *     *     *

As reported in Troubled Company Reporter's April 11, 2003
edition, Moody's Investors Service drops several debt ratings of
J. Crew Group and its operating unit, J. Crew Operating Corp
down to low-Bs and junks. The downgrade follows the announcement
of a $9 million write down on its previously reported net
income.

                         Rating Actions

                                                 To      From
J. Crew Group:

     Senior implied                              B3      B2
     13.125% Senior Discount Notes due 2008      Ca      Caa3
     Issuer rating                               Ca      Caa3

J. Crew Operating Corp.:

     10.375% senior subordinated notes due 2007  Caa3    Caa1

The downgrade reflects a very high leverage and the expectations
of a weak performance and operating profitability in the coming
months. Other factors considered are the seasonality and
volatility associated with the company's apparel business.


J.CREW: Commences Exchange Offer for Junk-Rated Sr. Debentures
--------------------------------------------------------------
J. Crew Group, Inc. has commenced through J. Crew Intermediate
LLC, its newly formed wholly-owned subsidiary, an offer to
exchange the outstanding 13-1/8% Senior Discount Debentures due
2008 issued by the Company for Intermediate's unissued 16.0%
Senior Discount Contingent Principal Notes due 2008.

In conjunction with the exchange offer, Intermediate is also
soliciting consents to proposed amendments to the existing
debentures indenture which would eliminate most of the
restrictive covenants.

The exchange offer and consent solicitation are subject to
customary conditions, including that a majority in principal
amount of the outstanding existing debentures shall have been
tendered pursuant to the exchange offer and not withdrawn.
Holders of a majority of the principal amount of the outstanding
existing debentures have agreed to tender all of their existing
debentures in the exchange offer. Such tender of existing
debentures would satisfy the minimum tender requirement.

The Company will not pay accrued and unpaid interest on the
existing debentures on the scheduled interest payment date of
April 15, 2003. Rather, the Company will pay such interest on
the settlement date of the exchange offer (which is expected to
occur on or about May 6, 2003) together with interest thereon at
a rate of 13-1/8% per annum from April 15, 2003 to the
settlement date, to the holders of the existing debentures who
do not tender their existing debentures in the exchange offer.

The new notes will not be registered under the Securities Act of
1933, as amended. The exchange offer is being made in reliance
upon the exemption from registration provided by Section 4(2) of
the Securities Act and similar exemptions from registration
provided by certain state securities laws. The new notes will
only be offered to qualified institutional buyers, as that term
is defined in Rule 144A under the Securities Act, and
institutional accredited investors, as that term is defined in
Rule 501(a)(1), (2), (3) or (7) under the Securities Act, as
well as in off shore transactions to person other than a U.S.
person, as that term is defined in Regulation S under the
Securities Act.

                          *     *     *

As reported previously, Moody's Investors Service drops several
debt ratings of J. Crew Group and its operating unit, J. Crew
Operating Corp down to low-Bs and junks. The downgrade follows
the announcement of a $9 million write down on its previously
reported net income.

                      Rating Actions

                                                 To      From
J. Crew Group:

     Senior implied                              B3      B2
     13.125% Senior Discount Notes due 2008      Ca      Caa3
     Issuer rating                               Ca      Caa3

J. Crew Operating Corp.:

     10.375% senior subordinated notes due 2007  Caa3    Caa1

The downgrade reflects a very high leverage and the expectations
of a weak performance and operating profitability in the coming
months. Other factors considered are the seasonality and
volatility associated with the company's apparel business.


KENNY INDUSTRIAL: Committee Brings-In Arnstein & Lehr as Counsel
----------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Illinois
gave its stamp of approval to the Official Committee of
Unsecured Creditors of Kenny Industrial Services, LLC's
application to retain Arnstein & Lehr as its counsel.

The Committee says it selected Arnstein & Lehr as its counsel in
this bankruptcy case because of the Firm's experience in
representing all parties, including committees, in Chapter
11 cases.  As Committee Counsel, Arnstein & Lehr will:

      a) advise and represent the Committee relative to its
         respective rights, duties, and powers in relation to the
         debtors-in-possession;

      b) advise and represent the Committee in negotiating and
         litigating to obtain authority for the use of cash
         collateral and in all other issues relating to the
         Debtors' use of cash collateral;

      c) advise and represent the Committee with regard to
         negotiation of the plan and disclosure statement as it
         relates to members of the Committee, other creditors,
         and the Debtors;

      d) review and analyze positions of secured creditors,
         including Bank One NA;

      e) examine and analyze executory leases and represent the
         interests of the Committee with regard to any such
         leases;

      f) review, analyze, advise, and represent the Committee in
         any matters involving self-insurance, health insurance,
         other employee issues, and union issues and concerns
         related to the Debtors;

      g) examine the value of the Debtors' assets and negotiate,
         if necessary, the sale of such assets; and

      h) provide such and further representation to the Committee
         as shall be necessary in this case.

Arnstein & Lehr will bill the Debtor's estates at the Firm's
current hourly rates, which are:

           James A. Chatz           $460 per hour
           Barry A. Chatz           $395 per hour
           Miriam R. Stein          $270 per hour
           Dorislee Jackson         $175 per hour
           William G. Nosek         $340 per hour
           Mark F. Miller           $340 per hour
           Cynde Hirschtick Munzer  $340 per hour
           George P. Apostolides    $260 per hour
           Erik L. Kantz            $205 per hour

Kenny Industrial Services is a provider of comprehensive
industrial preservation and maintenance services, including
chemical cleaning, waste separation and minimization,
fireproofing, insulation, identification and tagging, and
concrete restoration.  The Company with its debtor-affiliates
filed for chapter 11 protection on February 3, 2003 (Bankr. N.D.
Ill. Case No. 03-04959).  James A. Stempel, Esq., and Ryan
Blaine Bennett, Esq., at Kirkland & Ellis represent the Debtors
in their restructuring efforts.  When the Company filed for
protection from its creditors, it listed $70,189,327 in total
assets and $102,883,389 in total debts.


KMART CORP: Dist. Ct. Says Critical Vendor Payments Improper
------------------------------------------------------------
The Honorable John F. Grady sitting in the U.S. District Court
for the Northern District of Illinois finds that Judge
Sonderby's orders authorizing payment of approximately $300
million to Kmart's Critical Vendors for their prepetition claims
were contrary to bankruptcy law and should be reversed.

Judge Grady rejects Kmart's argument that Capital Factor's
appeal is moot because the payments have already been made.
Judge Grady tells Judge Sonderby to issue an order directing
recipients of Critical Vendor Payments to return the money to
Kmart's estates.

The Bankruptcy Code "does not carve out priority or
administrative expense status for prepetition general unsecured
claims based on the 'critical' or 'integral' status of a
creditor," Judge Grady says, explaining that the effect is to
elevate the claims of select unsecured creditors and
subordinating all other unsecured claims.  Judge Grady finds
that Judge Sonderby improperly altered the statutory priority
scheme codified at 11 U.S.C. Secs. 503 and 507.

Judge Grady recognizes that invoking the so-called doctrine of
necessity "is well-intended and may even have some beneficial
results" in Kmart's cases.  "Nevertheless, it is clear that
however useful and practical these payments may appear to
bankruptcy courts, they simply are not authorized by the
Bankruptcy Code."  Until Congress codifies the doctrine of
necessity, Judge Grady opines, pre-plan payments of pre-petition
unsecured claims are illegal.

"[I]t is not too late to order that the monies paid be
returned," Judge Grady says.  Judge Grady doesn't buy the
Debtors' "doomsday speculation" that undoing the bankruptcy
court's orders would paralyze Kmart by forcing it to undergo the
Herculean task of immediately commencing thousands of lawsuits
to collect hundreds of millions of dollars from thousands of
vendors.  It is not evident to the District Court that Kmart
would have to sue anyone to recover the payments.  The District
Court suggests an order from Judge Sonderby directing the return
of the monies paid will be sufficient.

Kmart Corporation and its debtor-affiliates delivered their
Notice of Appeal to the U.S. District Court for the Northern
District of Illinois indicating their intention to seek review
of Judge Grady's order reversing Judge Sonderby's orders
allowing payment of pre-petition claims owed to Kmart's Critical
Vendors, Foreign Vendors, Liquor Vendors and to JPMorgan on
account of letter of credit reimbursement obligations.


KMART CORP: Appoints Nine Members to New Holding Company Board
--------------------------------------------------------------
Kmart together with the plan investors, ESL Investments, Inc.
and Third Avenue Trust, and the statutory committees have
designated individuals to serve on the initial board of
directors of the New Holding Company.  These individuals will
oversee Kmart's operations when it emergences from Chapter 11.

     By the Debtors:             Julian C. Day

     By the Plan Investors:      Edward S. Lampert
                                 William C. Crowley
                                 Steven T. Mnuchin
                                 Thomas J. Tisch

     By Unsecured Creditors'
     Committee:                  E. David Coolidge III
                                 William S. Foss

     By the Financial
     Institutions Committee:     Ann N. Reese
                                 Brandon Stranzl

Kmart will seek approval of the nominees at the Court hearing
today in Chicago. (Kmart Bankruptcy News, Issue  No. 52;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


LODGENET ENTERTAINMENT: Fiscal Year Net Loss Balloons to $29-Mil
----------------------------------------------------------------
LodgeNet Entertainment Corporation is the world's largest and
leading provider of broadband, interactive TV systems and
services to hotels, resorts and casinos throughout the United
States and Canada as well as select international markets. More
than 260 million guests a year can use a wide range of LodgeNet
interactive services including digital movies, music and
television on-demand programming as well as video games, high-
speed Internet access and other services designed to make their
stay more enjoyable, productive and convenient. As of December
31, 2002, the Company provided interactive television services
to approximately 5,700 hotel properties serving more than
950,000 rooms, more properties and rooms than any other provider
in the world.

The Company's total revenue for 2002 was $235.0 million, an
increase of $18.1 million, or 8.3%, compared to 2001. The
increase resulted from a 10.2% increase in average Guest Pay
interactive rooms in operation, driven by the addition of nearly
150,000 rooms served by the Company's next-generation
interactive digital system, which represents a 129.8% increase
over 2001.

Guest Pay interactive service revenue increased 9.8%, or $20.2
million, in 2002 as compared to 2001. The increase was primarily
due to the additional 77,800 average Guest Pay rooms in
operation and the growth of Guest Pay rooms installed with the
interactive digital system.

Guest Pay interactive direct costs increased 12.6% to $96.0
million in 2002 from $85.3 million in the prior year. Guest Pay
direct costs (movie license fees, music license fees within
major motion pictures, license fees for other interactive
services, Internet connectivity fees, and the commission
retained by the hotel) are primarily based on related revenue,
and such costs generally vary directly with revenue. The
decrease of gross profit margin from 58.6% to 57.5% was
primarily attributable to the costs that the Company absorbed
upon termination of InnMedia and increases in hotel commissions,
offset by reductions in video game royalties. InnMedia costs
included Internet connectivity, hotel commissions, royalties,
and technical support fees, and other direct expenses.

Other direct costs associated with other revenue decreased $2.1
million, or 30.3%, in 2002 from the prior year and the gross
profit margin increased from 37.6% in 2001 to 45.9% in 2002. The
resulting increased gross profit margin was attributable to the
reduction of lower margin sales of equipment to international
licensees.

The Company's overall gross profit increased 7.5% in 2002 to
$134.2 million on an 8.3% increase in revenue as compared to
2001. As a percentage of revenue, the overall gross profit
margin was 57.1% in 2002 compared to 57.5% in the prior year.
The change was primarily due to the costs that the Company
absorbed upon termination of InnMedia and increases in hotel
commissions, offset by reductions in video game license fees and
a nominal shift in sales from higher margin Guest Pay
interactive services, such as movies, to lower margin free to
guest and Internet services.

Guest Pay operations expenses consist of costs directly related
to the operation of systems at hotel sites. Guest Pay operations
expenses increased by $1.5 million, or 5.3%, in 2002 from the
prior year. This increase is primarily attributable to the 10.2%
increase in average installed Guest Pay interactive rooms in
operation during 2002 as compared to 2001. Offsetting the
increased operating costs were greater operating efficiencies
resulting from reduced truck rolls related to tape changes and
related freight costs and improved economies of scale. Per
average installed room, Guest Pay operations expenses decreased
by 4.5% to $2.98 per month in 2002 as compared to $3.12 per
month in 2001.

Selling, general and administrative expenses increased 5.4% to
$22.1 million in 2002 from $21.0 million in 2001. The increase
was substantially attributable to an InnMedia bad debt charge of
$471,000 taken in the second quarter and approximately $640,000
of professional fees connected with the InnMedia-related
litigation that was dismissed with prejudice pursuant to a
settlement reached in August 2002. As a percentage of revenue,
selling, general and administrative expenses were 9.4% in 2002
and 9.7% in 2001.

Depreciation and amortization expenses increased 15.0% to $75.9
million in 2002 from $66.0 million in the prior year. The
increase was primarily due to the additional 77,800 average
Guest Pay interactive rooms in operation. During the fourth
quarter, the Company also expensed approximately $1.4 million of
unamortized costs related to browser software that the Company
replaced with new browser software that provides greater
functionality. Additionally, the Company also incurred
depreciation expense of $860,000 for other capitalized costs
including new service vans, equipment, and computers, and
additional amortization expense of $1.3 million for software
development and other intangibles, offset by the changes in
fully depreciated assets remaining in service. As a percentage
of revenue, depreciation and amortization expenses increased to
32.3% in 2002 from 30.4% in 2001.

Interest expense was $33.0 million in 2002 compared to $30.3
million in 2001 due to increases in long-term debt to fund the
Company's continuing expansion of its business. The average
principal amount of long-term debt outstanding during 2002 was
approximately $339 million (at a weighted average interest rate
of approximately 9.8%) as compared to an average principal
amount outstanding of approximately $307 million (at a weighted
average interest rate of approximately 9.9%) during 2001.

The Company incurred a net loss in 2002 of $29.1 million as
compared to a net loss of $26.4 million in 2001.

Lodgenet disclosed a total shareholders equity deficit of about
$101 million at Dec. 31, 2002.

DebtTraders says that Lodgenet Entertainment's 10.250% bonds due
2006 (LNET06USR1) are trading at 96 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=LNET06USR1
for real-time bond pricing.


MAGELLAN HEALTH: Employing Ordinary Course Professionals
--------------------------------------------------------
Magellan Health Services, Inc., and its debtor-affiliates
obtained the Court's permission, pursuant to Sections 105(a),
327, 328, and 330 of the Bankruptcy Code, to employ
professionals that are utilized in the ordinary course of their
businesses without the submission of separate employment
applications, affidavits, and the issuance of separate retention
orders for each individual professional.

The Debtors will pay each Ordinary Course Professional, without
a prior application to the Court, 100% of the fees and
disbursements incurred, after the submission to, and approval
by, the Debtors of an appropriate invoice setting forth in
reasonable detail the nature of the services rendered and
disbursements actually incurred, up to $25,000 per month per
Ordinary Course Professional and up to $500,000 per month, in
the aggregate, for all Ordinary Course Professionals.  In the
event that an Ordinary Course Professional seeks more than
$25,000 per month, that professional will be required to file a
fee application for the full amount of their fees in accordance
with Sections 330 and 331 of the Bankruptcy Code, the Federal
Rules of Bankruptcy Procedure, the Local Bankruptcy Rules, the
Fee Guidelines promulgated by the United States Trustee for the
Southern District of New York, and any and all orders of the
Court.

In addition, each Ordinary Course Professional will serve on the
Office of the United States Trustee and the Debtors and file
with the Court:

     (i) an affidavit certifying that the professional does not
         represent or hold any interest adverse to the Debtors or
         their estates with respect to the matter on which the
         professional is to be employed; and

    (ii) a completed retention questionnaire.

The Debtors reserve the right to supplement the list of Ordinary
Course Professionals from time to time as necessary.  In this
event, the Debtors will file a notice with the Court stating
that they intend to employ additional Ordinary Course
Professionals and to serve the notices on:

     -- the United States Trustee;

     -- the attorneys for the statutory committee of unsecured
        creditors appointed in these cases;

     -- the attorneys for the Debtors' prepetition lenders; and

     -- all other parties that have filed a notice of appearance
        in these Chapter 11 cases.

The Debtors also sought and obtained Court approval to dispense
with the requirement of individual employment applications and
retention orders with respect to each Ordinary Course
Professional retained from time to time. (Magellan Bankruptcy
News, Issue No. 5: Bankruptcy Creditors' Service, Inc., 609/392-
0900)


MAXXIM MEDICAL: Will Padlock Richmond, Virginia Facility
--------------------------------------------------------
After stating in early 2002 that it would consolidate several
production sites to achieve production efficiencies and
rationalize its manufacturing capabilities, Maxxim Medical, Inc.
has now made the last announcement in this long-term effort with
the phasing out of its Richmond, Va. facility and the
transitioning of production of custom procedure trays from that
location to its Clearwater headquarters plant on June 13, 2003.

"During the past 18 months, Maxxim Medical has made significant
strides in productivity improvement and process enhancements;
advances that will now allow us to consolidate several of our
production sites," says Thomas R. Cochill, president and chief
executive officer. "Process improvements and automated assembly
upgrades to the Clearwater facility have made this move possible
as well as beneficial."

He adds: "We obviously regret the impact this will have on our
valued employees and our longstanding relationships within the
Richmond business community."

The Company does not anticipate this will affect the level of
service and delivery provided to customers, noting that capacity
is available in the Clearwater plant not only to absorb the
Richmond production volume, but also to support anticipated
future growth.

Cochill adds that this process of asset rationalization is not
related to the Company's recent filing for Chapter 11
(Reorganization). "This plan long predates our filing and
reflects normal, sound business planning as part of our ongoing
business management and improvement processes," he says.

Based in Clearwater, Fla., Maxxim Medical --
http://www.maxximmedical.com-- is a major diversified
manufacturer, assembler and marketer of specialty medical and
surgical products including custom and standard procedure trays,
single use drapes and gowns, medical and surgical gloves,
vascular access and critical care products. Selling primarily to
acute care hospitals, surgery centers and alternate care
facilities, Maxxim has five plants in the United States and one
in the Dominican Republic. U.S. plants are located in Athens,
Texas; Clearwater, Fla.; Columbus, Miss.; Honea Path, S.C. and
Richmond, Va. (plant due to be consolidated with Clearwater in
June 2003). Maxxim Canada Limited has a plant in Mississauga,
Ontario, Canada.


MEDICALCV INC: Consummates $3.8 Million Refinancing Transaction
---------------------------------------------------------------
MedicalCV, Inc. (OTC Bulletin Board: MDCVU), a Minnesota-based
heart valve manufacturer, completed a $3.84 million refinancing
transaction in which its headquarters facility, located in Inver
Grove Heights, Minn., was sold in a sale-leaseback transaction
to PKM Properties, LLC, thereby eliminating MedicalCV's bank
debt.

Under the terms of the transaction, MedicalCV received $1
million in cash, with PKM assuming $2.5 million of the company's
outstanding bank debt and approximately $340,000 of additional
obligations of the company. Of the net cash proceeds, $300,000
plus interest was applied to MedicalCV's indebtedness to PKM,
pursuant to a discretionary credit agreement secured by
MedicalCV's assets, leaving a balance due to PKM of
approximately $943,000. MedicalCV also signed a 10-year lease on
its headquarters building, with options to renew or repurchase
the facility.

"We are pleased that this transaction enabled us to pay off our
outstanding bank debt and improve our liquidity and working
capital position," said Blair Mowery, president and chief
executive officer of MedicalCV, Inc. "This represents an
important first step in our strategy to obtain additional longer
term financing." The company plans on raising additional funds
to finance its marketing and sales initiatives for the U.S. and
key strategic markets in Europe.

PKM Properties, LLC, is owned by Paul K. Miller, a member of
MedicalCV's board of directors and its largest shareholder. As
part of the transaction, MedicalCV issued to PKM a five-year
warrant for the purchase of 350,000 shares of common stock at a
purchase price of $0.625 per share. The refinancing transaction
was approved by MedicalCV's board of directors and a special
committee; Mr. Miller abstained from voting on the transaction.

MedicalCV, Inc., is a Minnesota-based heart valve manufacturer
with a fully integrated manufacturing facility, where it
designs, tests and manufactures all of its products.  Based on
its Omnicarbon(TM) heart valve's 18 years of excellent clinical
results in Europe, Japan and Canada, the U.S. Food and Drug
Administration gave premarket approval for the Omnicarbon valve
in July 2001 for use in the United States, without requiring
additional U.S. clinical trials.  To date, more than 30,000
Omnicarbon valves have been implanted in patients in more than
30 countries.  For more information on the company, visit its
Web site at http://www.medcvinc.com

                          *     *     *

As of January 31, 2003, MedicalCV had an accumulated deficit of
$16,154,795. As stated, the Company has incurred losses in each
of the last six fiscal years. Since 1994, it has invested in
developing a bileaflet heart valve, a proprietary pyrolytic
carbon coating process and obtaining premarket approval from the
FDA to market its Omnicarbon 3000 heart valve in the U.S. Its
strategy has been to invest in technology to better position it
competitively once FDA premarket approval was obtained. The
Company expects net losses to continue through fiscal year 2004
because of anticipated spending necessary to market the
Omnicarbon 3000 heart valve in the U.S., and to establish and
maintain a strong marketing organization for domestic and
foreign markets.

Subject to the uncertainties surrounding the need for financing
MedicalCV expects to continue developing its business and to
build market share in the U.S. now that it has FDA premarket
approval of its Omnicarbon 3000 heart valve for sales in the
U.S.  These activities will require significant expenditures to
develop, train and supply marketing materials to its independent
sales representatives and to build its sales and marketing
infrastructure.  As a result, the Company anticipates that its
sales and marketing and general and administrative expenses will
continue to constitute a material use of its cash resources. The
actual amounts and timing of capital expenditures will vary
significantly depending upon the speed at which the Company is
able to expand distribution capability in domestic and
international markets and the availability of financing.

MedicalCV expects its operating losses and negative operating
cash flow will continue for the remainder of fiscal year 2003
and fiscal year 2004 as it expands its manufacturing
capabilities, continues increasing its corporate staff to
support the U.S. roll-out of its Omnicarbon 3000 heart valve,
and add marketing programs domestically and internationally to
build awareness of and create demand for its Omnicarbon heart
valves.

MedicalCV's ability to continue as a going concern is dependent
on its ability to obtain debt and/or equity financing in the
fourth quarter of fiscal 2003.  The Company is currently
pursuing the refinancing of its revolving line of credit and is
seeking other financing to fund operations and working capital
requirements. It is also considering the sale and leaseback of
its real estate to retire its bank debt and increase working
capital. MedicalCV indicates that it cannot provide any
assurance that such additional financing will be available on
terms acceptable to it or at all.  The Company will need to
obtain additional capital prior to the maturity date of its
revolving line of credit or otherwise extend or restructure this
debt to continue operations.


MIDLAND STEEL: Pepper Hamilton Hired as Committee's Attorneys
-------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware gave the
Official Committee of Unsecured Creditors of Midland Steel
Products Holdings Company permission to employ Pepper Hamilton
LLP as its attorney in Midland's on-going chapter 11 proceeding.

The Committee is satisfied that Pepper Hamilton is qualified to
represent it in a cost-effective, efficient and timely manner
and that the Firm's employment will be in the best interest of
the Committee and the estate.  The Committee expects Pepper
Hamilton to:

      a. advise the Committee with respect to the performance of
         its duties and powers in this case;

      b. assist and advise the Committee in its communications
         with the general creditor body regarding significant
         matters in this case;

      c. assist and advise the Committee in its consultation with
         the Debtor relative to the administration of this case;

      d. attend meetings and negotiate with the representatives
         of the Debtor;

      e. assist and advise the Committee in its examination and
         analysis of the conduct of the Debtor's affairs;

      f. assist and advise the Committee in the review, analysis
         and negotiation of any plan(s) of reorganization that
         may be filed and to assist the Committee in the review,
         analysis and negotiation of the disclosure statement
         accompanying any plan(s) of reorganization;

      g. assist the Committee in the review, analysis and
         negotiation of any financing agreements;

      h. take all necessary action to protect and preserve the
         interests represented by the Committee, including

           (i) the prosecution of actions on its behalf,

          (ii) negotiations concerning and participation in all
               litigation, whether adversary proceedings or
               contested matters, in which the Debtor or
               Committee is involved, and

         (iii) if appropriate, review, analyze and reconcile
               claims filed against the Debtor's estate;

      i. generally prepare on behalf of the Committee all
         necessary motions, applications, answers, responses,
         orders, reports and papers in support of positions taken
         by the Committee;

      j. appear, as appropriate, before this Court, any Appellate
         Court and any other tribunals in order to protect and
         promote the interests of the Committee before said
         Courts and tribunals; and

      k. perform all other necessary legal services in this case.

Pepper Hamilton's current hourly billing rates are:

           Partner           $325 - $445 per hour
           Associate         $150 - $275 per hour
           Paralegal         $95 - $140 per hour

The Committee assures the Court that Pepper Hamilton is a
"disinterested person" as defined in Section 101(14) of the
Bankruptcy Code.

Midland Steel Products Holding Company provides frames for the
medium duty line at General Motors.  The Debtors filed for
chapter 11 bankruptcy protection on January 13, 2003 (Bankr.
Del. Case No. 03-10136. Laura Davis Jones, Esq., at Pachulski
Stang Ziehl Young Jones & Weintraub and Shawn M. Riley, Esq., at
McDonald, Hopkins, Burke & Haber Co., LPA represent the Debtors
in their restructuring efforts.


MOUNT SINAI-NYU: Fitch Cuts $665M Bond Rating to BB+ from BBB-
--------------------------------------------------------------
Fitch Ratings downgrades approximately $665.6 million Mount
Sinai-NYU Health System's bonds to 'BB+' from 'BBB-'. At the
lower rating level, the Rating Outlook has been changed to
Stable from Negative.

The rating downgrade is based on the decline in financial
performance of the system and the significant challenges faced
by the system, primarily Mount Sinai Hospital. Both MSH and NYU
Hospitals Center, the principal parties of the merger,
acknowledge that the system was a failure and that they are in
the process of unwinding all material administrative shared
services, including a central billing office. Clinical services
were never merged. The two main entities function autonomously
under a 'campus centric' structure (implemented in late 2001).
The only remaining material shared service planned to remain
intact for the foreseeable future is the management of the
outstanding debt. MSH and NYUHC plan to refinance the debt
through HUD's FHA 242 program, although it is unlikely this
refinancing will occur in the near-term.

Also of concern is the likelihood of additional debt this year,
which will further strain MS-NYU's weak financial profile. MS-
NYU intends to transfer residential real estate owned by MSH,
Mount Sinai School of Medicine, and Realty to a special purpose
entity-which will undertake a borrowing of $100-150 million that
will be secured by that real estate.

MS-NYU's financial performance has deteriorated in 2002 and all
financial ratios are below Fitch's investment grade medians. MS-
NYU's financial ratios in fiscal 2002 include 65.1 days cash on
hand, 37.4% cash to debt, negative 4.4% operating margin and
1.1x debt service coverage*. The decline in financial
performance is driven mainly by MSH, which continues to
experience significant operating losses. MSH implemented a
turnaround plan in 2002, based on initiatives from a six-month
study performed by The Hunter Group, a consulting firm that
specializes in turn-arounds. However, many of the initiatives
were slow to be implemented and thus failed to achieve their
stated goals for 2002. MSH, which lost $46.8 million from
operations (Fitch's calculation) in 2001, lost $64.3 million in
2002.

MSH recently named a long-time member of the medical staff to
run both the medical school and MSH, merging both
responsibilities in a single position. The leadership change at
MSH is the third such change in the last four years. In
addition, MSH has engaged Cap Gemini Ernst & Young to assist in
the implementation of many of the turnaround strategies. MSH is
budgeting to lose $78.3 million from operations in 2003. Ongoing
expense reduction initiatives include reducing staffed beds,
FTEs, and support to the medical school. Interim financial
statements for any period in 2003 are not available.

Fitch calculates that NYUHC made $6.3 million from operations in
2002.

Fitch believes MS-NYU faces numerous challenges ahead including
the turnaround of MSH and significant industry pressures such as
rising labor and pharmaceutical costs, increased capital needs,
and the decline in Medicaid reimbursement. These challenges will
impede the organization's return to profitability and Fitch
believes the restoration of MS-NYU's financial health will be a
long and slow process.

MS-NYU, which came together on July 15, 1998, had total revenues
of $1.8 billion in 2002. MS-NYU has covenanted to supply
bondholders with quarterly financial statements and operating
statistics, and has provided Fitch with information on a
quarterly basis.

* Fitch includes MSH, NYUHC, Hospital for Joint
Diseases/Orthopedic Institute (HJD), NYU Downtown Hospital and
MSMC Realty Corp., in its calculations. The obligated group
consists of MSH, NYUHC and HJD only. Fitch's estimate of MADS
includes all long-term indebtedness, including all non-
cancellable capital and operating leases, bank loans, and long-
term debt issued by MSMC Realty on behalf of MSH.


NATIONAL STEEL: Has New Bids for Sale of All Principal Assets
-------------------------------------------------------------
National Steel Corporation has received bids for the sale of
substantially all of its principal steelmaking and finishing
assets and iron ore pellet operations. First, AK Steel
Corporation reaffirmed its bid for $1.125 billion, consisting of
$925 million in cash and the assumption of certain liabilities
approximating $200 million, but due to its failure to reach
agreement with the United Steelworkers of America on a new labor
agreement, its proposal is conditioned on the rejection of all
of National Steel's collective bargaining agreements with the
USWA and the termination of all retiree benefits in accordance
with Sections 1113 and 1114 of the Bankruptcy Code.

In addition, United States Steel Corporation submitted a bid to
acquire substantially all of National Steel's principal
steelmaking and finishing assets and iron ore pellet operations
for $975 million, consisting of $775 million in cash and the
assumption of certain liabilities approximating $200 million.
U.S. Steel previously announced that it has reached a tentative
agreement with the USWA on a new labor agreement.

Also as previously announced, early termination of the waiting
period under the Hart-Scott-Rodino Antitrust Improvements Act
with respect to the AK Steel proposal was granted and that the
Department of Justice advised National Steel that it had closed
its investigation under the HSR Act with respect to the U.S.
Steel proposal. Both offers remain subject to the satisfaction
of other closing conditions.

The date of the auction for the sale of substantially all of
National Steel's assets is scheduled for April 16, 2003. The
Bankruptcy Court hearing to consider approval of the sale of
such assets is scheduled for April 21, 2003.

In addition, National Steel announced that the Bankruptcy Court
approved an extension of the period during which National Steel
has the exclusive right to file a plan of reorganization in its
Chapter 11 case to April 30, 2003.

National Steel filed its voluntary petition in the U.S.
Bankruptcy Court for the Northern District of Illinois in
Chicago on March 6, 2002.

Headquartered in Mishawaka, Indiana, National Steel Corporation
is one of the nation's largest producers of carbon flat-rolled
steel products, with annual shipments of approximately six
million tons. National Steel employs approximately 8,200
employees. For more information about the company, its products
and its facilities, please visit National Steel's Web site at
http://www.nationalsteel.com

DebtTraders reports that National Steel Corp.'s 9.875% bonds due
2009 (NSTL09USR1) are trading between 63 and 65. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=NSTL09USR1
for real-time bond pricing.


NATIONAL STEEL: AK Steel Reaffirms $1.25-Billion Bid for Assets
---------------------------------------------------------------
AK Steel (NYSE:AKS) said that it had not reached agreement with
the United Steelworkers of America on a new, lower cost labor
contract, but reaffirmed its bid for substantially all the
assets of National Steel Corporation for $1.125 billion.

"After weeks of negotiations with the USWA, during which
progress was made, meaningful differences remain between the
parties in arriving at a labor agreement that would provide the
cost-based synergies contemplated in our original bid for
National Steel," said Richard M. Wardrop, Jr., chairman and CEO
of AK Steel. "Unfortunately we could not reach a new labor
agreement with the USWA that was economically feasible to
profitably operate National Steel," said Mr. Wardrop.

AK Steel said, however, that it remains interested in acquiring
the assets under conditions submitted today to National Steel
and its creditors. Under the conditions, AK Steel continues to
offer $1.125 billion for substantially all of the assets of
National Steel, however the labor approach will utilize Sections
1113 and 1114 of the U.S. Bankruptcy Code. It is anticipated
that this labor approach would yield the savings necessary for
AK Steel to realize some of the cost-based synergies for its
acquisition of National to be successful.

AK Steel produces flat-rolled carbon, stainless and electrical
steel products for automotive, appliance, construction and
manufacturing markets, as well as tubular steel products. The
company has more than 10,000 employees in plants and offices in
Middletown, Coshocton, Mansfield, Walbridge and Zanesville,
Ohio; Ashland, Kentucky; Rockport, Indiana; and Butler,
Pennsylvania. In addition, the company produces snow and ice
control products and operates an industrial park on the Houston,
Texas ship channel.


NATIONAL STEEL: Steelworkers Outraged by AK Steel Proposal
----------------------------------------------------------
The United Steelworkers of America reacted with outrage in
response to an announcement by AK Steel that it intends to
continue with its bid for the assets of National Steel without
the benefit of a labor agreement and will demand that National
use Sections 1113 and 1114 of the U.S. Bankruptcy Code to
abrogate National's labor agreement with the Steelworkers.

"We are shocked and dismayed at AK's decision to declare war on
the standard of living and health care security of our members
and retirees at National Steel," said Leo W. Gerard, USWA
International President. "This confrontation can only produce
horrible results for National Steel, its creditors, and the
communities where it operates."

Just yesterday, the USWA successfully concluded a labor
agreement with U.S. Steel that will enable U.S. Steel to
purchase the assets of National Steel, reduce the company's
operating costs, and protect the job security, retirement
security and health care benefits for Steelworker members and
retirees.

"Long and thoughtful discussions with U.S. Steel produced an
excellent agreement for both sides. Our negotiations with AK
were disappointing, to say the least," Gerard said. "AK never
demonstrated any real intention to reach an agreement."

"This Union has demonstrated time and again that when companies
take the high road -- treat our members and their union with
respect, recognize their skills, and reward their loyalty -- we
can work together to build strong viable companies that serve
all stakeholders. We have done this in the recent past with
numerous steel companies, including ISG, Bethlehem, Wheeling-
Pitt, and now U.S. Steel.

"On the other hand, those who choose the low road -- unnecessary
confrontation with no recognition of the central role of labor
in the success of a company -- have learned that nothing but bad
will come for all involved.

"We can be a smart company's best friend or a foolish company's
worst enemy. U. S. Steel has chosen one path -- AK now appears
to have chosen the other by adopting a confrontational mode that
is a relic of a bygone era."

"We can only pray that National Steel has the wisdom to
recognize this destructive approach for what it is," Gerard
said, "and act before it is too late."

The USWA will be reconvening shortly its National Steel
bargaining committee to discuss a strategic response to AK
Steel's actions. It will also be contacting the other
stakeholders involved in National's restructuring to discuss the
potential dire consequences of AK Steel's brinkmanship tactics.


NATIONAL STEEL: U.S. Steel Delivers $975MM Bid to Acquire Assets
----------------------------------------------------------------
United States Steel Corporation (NYSE: X) confirmed that it has
submitted a bid to National Steel Corporation to purchase
substantially all of National's steelmaking and steel finishing
assets and the assets of National Steel Pellet Company for a
price of $975 million, payable through $775 million in cash and
the assumption of $200 million of National liabilities. This
price is in addition to the significant value that U. S. Steel
will provide to National's employees through its progressive new
labor agreement with the United Steelworkers of America (USWA)
announced on Wednesday.

Commenting on the new tentative labor agreement, U. S. Steel
Chairman and Chief Executive Officer Thomas J. Usher said, "This
innovative agreement builds value for our employees and the
employees of National Steel while providing us the flexibility
to staff and operate our facilities on a world competitive
basis. The agreement also allows us to address critical issues
related to steel companies in bankruptcy in a humane way."

U. S. Steel's bid is consistent with the terms of its January 9,
2003, Asset Purchase Agreement with National, adjusted for the
addition of the National Steel Pellet assets. The January
Agreement was conditioned on obtaining a satisfactory labor
agreement. Because of the groundbreaking agreement reached with
the USWA this week, the bid submitted to National on April 10 is
not conditioned on a labor agreement. U. S. Steel has also
received all necessary regulatory approvals to close the
National acquisition, and the bid is subject only to customary
closing conditions.

Usher stated, "We remain the best solution for National's
customers, employees, retirees, creditors, suppliers and the
communities in which National operates. We have a labor
agreement that ensures continuity of National's business
operations and uninterrupted supply to National's customers,
provides secure jobs and competitive wages for the National
employees, and assists in the fair and humane resolution of the
legacy problems that have plagued National and the domestic
steel industry. It's time to resolve the National Steel
bankruptcy in the best way for all interested parties. We have
offered a fair value for National's assets, and we are prepared
to close the deal immediately following Bankruptcy Court
approval."

National Steel has been operating under the protection of the U.
S. Bankruptcy Code since March 6, 2002, and the United States
Bankruptcy Court for the Northern District of Illinois has
established a bidding procedure that includes an auction on
April 16, 2003, and a hearing to confirm the winning bid on
April 21, 2003.

Under its bid, U. S. Steel would acquire facilities at
National's two integrated steel plants, Great Lakes Steel, in
Ecorse and River Rouge, Mich., and the Granite City Division in
Granite City, Ill.; the Midwest finishing facility in Portage,
Ind., near Gary, Ind.; ProCoil Corporation in Canton, Mich.;
National Steel Pellet Company's iron ore pellet operations in
Keewatin, Minn. and various other subsidiaries; and joint-
venture interests, including National's share of Double G
Coatings, L.P. in Jackson, Miss.

For more information about U. S. Steel visit its
Web site at http://www.ussteel.com


NRG ENTERTAINMENT: Commences 1-For-125 Reverse Stock Split
----------------------------------------------------------
N.R.G. Entertainment, Inc. (NQB-EQS NRGA), announced that,
effective Thursday, March 27, 2003, it has implemented a reverse
share split of 1 new common share for each 125 old common
shares.

Global markets and investment conditions have created a
financial atmosphere which has made it very difficult for many
companies to survive.

Despite this adversity over the past year, the company has made
every effort possible to both maintain the ongoing operation of
the company, as well as to secure appropriate financing to allow
the company to successfully execute its business plan. Present
management believes very strongly in the inherent potential
value in the company's investment strategy, and thus has
realized the necessity to consolidate the share structure to
optimize their impending opportunities to protect shareholder
value with a view to future success in the industry.

The N.R.G. Entertainment corporate mandate is to find and
develop new talent. N.R.G. is now well positioned to be the
leading global supplier of new talent by providing independent
artists with much needed integrated support and services through
the Company's four basic business divisions; Indieland Music
Services Ltd (sales, distribution and licensing), FATBOY Records
Corp (record label division), Zanzara Music Publishing
(publishing), and NRG Multimedia Group (Internet division). The
Company believes strongly that its unique market focus will
enable it to experience exceptional revenue and earnings growth
over the intermediate and long-term.


OBSIDIAN ENTERPRISES: Jan. 31 Balance Sheet Upside-Down by $1MM
---------------------------------------------------------------
Obsidian Enterprises, Inc. (OTC Bulletin Board: OBSD), reports
consolidated net revenues totaling $10,899,365 for the first
quarter ended January 31, 2003.  EBITDA from continuing
operations was a deficit of $204,036, and net loss of $1,566,395
for the quarter ended January 31, 2003.

The Company's overall operating results and financial condition
during the three months ended January 31, 2003 were adversely
affected by the overall economic situation in the United States,
limited availability of raw materials in the butyl rubber
reclaiming segment and adverse weather conditions in the Midwest
United States that affected the Company's ability to deliver
orders in the trailer and related transportation equipment
manufacturing segment. In addition, the first quarter
historically produces the lowest revenue and operating results
due to the business seasonality in the trailer and related
transportation equipment manufacturing and coach leasing
segments.

Sales and gross profits from continuing operations in the
trailer and related transportation equipment manufacturing
segment decreased $874,000 (10.6%) and $265,000 (29%) over the
comparable period of 2002. The decrease was primarily related to
two factors. First, sales of truck bodies decreased by $354,000
over the quarter ended January 31, 2002. This reduction was
related to the continued depressed condition of the
telecommunications industry which has historically been a
significant consumer of truck bodies, as well as the bankruptcy
filing of a significant truck body customer in late 2002. Sales
to this customer in the first quarter did not decline
significantly from 2002, but the Company anticipates little to
no future sales from this customer after January 31, 2003.
Second, the sale of cargo trailers decreased by $520,000 as a
result of the general state of the U.S. economy and harsher
weather during the winter of 2003. The gross profit decrease was
primarily a result of decreased volume at the Company's truck
body plant that resulted in an inability to absorb fixed
overhead costs. To offset these costs, management began
production of cargo trailers in this facility during late 2002.
Inefficiencies in the start up of this operation have also had a
negative impact in gross profit margins as compared to the three
months ended January 31, 2002. Gross profits related to truck
body production are anticipated to continue to be adversely
impacted by the lack of sales volume in truck bodies during
2003. However, the additional cargo trailer capacity will help
offset this gross profit reduction.

Results for the quarter ended January 31, 2003 were also
impacted negatively by a shortage of quality raw material for
use in the butyl rubber reclaiming business in large part caused
by the extreme winter weather in northern collection regions.
Although sales in the segment increased by $243,000 (11%) over
the comparable period for 2002, gross profit was impacted
adversely by the raw material shortage. We are currently
pursuing additional sources of raw material and continue to
research alternative sources and processing methodologies to
reduce reliance on current sources and return to more efficient
operations in this segment.

Obsidian Enterprises' January 31, 2003 balance sheet shows a
total shareholders' equity deficit of about $1.2 million.


OWENS CORNING: Restructuring Toledo HQ Lease Obligations
--------------------------------------------------------
In a motion filed with the United States Bankruptcy Court for
the District of Delaware, Owens Corning requests approval of an
agreement in principle that would allow the company to
restructure the financing obligations and other agreements
relating to its World Headquarters building in Toledo, Ohio. The
company, which filed for Chapter 11 protection in 2000 due to
mounting asbestos liability, moved into its present location in
1996.

A major component of the motion is an agreement reached with a
group of bondholders that hold certain bonds used to finance the
Owens Corning World Headquarters. These bonds, which were issued
by the Toledo-Lucas County Port Authority, financed the majority
of the construction costs with respect to the facility. Owens
Corning's lease payments are used to make payments due on these
bonds as well as to pay certain other funding obligations.

"The agreement in principle is significant because it gets us to
a lease structure that is in line with market rates," said Jim
Eckert, Owens Corning's director of Real Estate and Facilities.
"We believe that this approach balances the interests of all of
our creditors.

"Approval of the motion would enable us to move swiftly to
complete the refinancing upon acceptance of the agreement by the
remaining bondholders. Since the terms of the agreement will
represent the best economic treatment available to the
bondholders, we believe all bondholders will participate," he
added.

The company has previously indicated that it was prepared to
move this year to an alternative location if it is unable to
restructure its current lease obligations to be more consistent
with market realities.

"Staying in our current facility is our preference," said Mr.
Eckert. "However we have no assurance at this time that these
discussions will be successfully concluded or that the
transaction will be approved by the bankruptcy court.
Accordingly, Owens Corning remains actively engaged in
discussions with several landlords in the general Toledo area
for space to replace the World Headquarters building."

The company has reached agreements with the Toledo-Lucas County
Port Authority, its landlord; and the City of Toledo and First
Energy Properties, Inc., owners of the site on which the World
Headquarters building is located, that, subject to Bankruptcy
Court approval of the entire contemplated transaction and 100
percent participation of the revenue bondholders, would enable
the company to remain in its present location.

"The community can take a lot of pride in how responsive both
the City, the Port Authority and Toledo Edison have been to the
tight timeframe we are in," said Mr. Eckert. "We really
appreciate how hard they are working to help Owens Corning
resolve questions about the company's ability to stay in its
present location."

Owens Corning is a world leader in building materials systems
and composite systems. Founded in 1938, the company had sales of
$4.9 billion in 2002. Additional information is available on
Owens Corning's Web site at http://www.owenscorning.com


PACIFIC GAS: Makes $75-Mill. Tax Payments to California Counties
----------------------------------------------------------------
Pacific Gas and Electric Company made property tax payments
totaling $75.5 million to the 49 counties in which it operates.
This amount represents full and timely payment of property taxes
due for the period from January 1 to June 30, 2003.

"Pacific Gas and Electric Company's payment of more than $75.5
million in property taxes to local governments will help fund
vital public services -- public safety, education, health care
and environmental protection," said Gordon R. Smith, president
and chief executive officer of Pacific Gas and Electric Company.
"PG&E's payment of property taxes, franchise fees and other
taxes and fees remain a stable source of revenue for local
governments in these times of tight budgets."

This is the fifth property tax payment Pacific Gas and Electric
Company has made to California counties since its Chapter 11
bankruptcy filing in April, 2001. The last of these twice-yearly
payments was made on December 10, 2002, when the utility paid
$75.3 million in property taxes. Since filing for Chapter 11
bankruptcy protection, Pacific Gas and Electric Company has
continued to meet its obligations to local governments by paying
timely property taxes, franchise payments and other fees.


PHOTRONICS INC: Prices $125 Million Conv. Sub. Debt Offering
------------------------------------------------------------
Photronics, Inc., (Nasdaq: PLAB) announced the pricing of its
offering of $125 million of 2-1/4% Convertible Subordinated
Notes due 2008 to qualified institutional buyers pursuant to
Rule 144A under the Securities Act of 1933. These Notes are
convertible into Photronics common stock at a conversion rate
of 62.9376 shares per $1,000 principal amount of Notes, subject
to adjustment in certain circumstances. This represents a 42.5%
premium based on the closing price of $11.15 for the common
stock on April 9, 2003. Photronics may not redeem the Notes
prior to their final maturity on April 15, 2008. The Notes
will be issued at 100% of their principal amount. Photronics has
granted the initial purchasers of the Notes a one-time option to
purchase up to an additional $25 million principal amount of
Notes.

A portion of the net proceeds from this offering will be used to
redeem, on or after June 2, 2003, all $62.1 million principal
amount of the Company's outstanding 6% Convertible Subordinated
Notes due 2004. The Company will use the balance of the net
proceeds for general corporate purposes.

The Notes and the common stock issuable upon conversion of the
Notes have not been registered under the Securities Act or any
state securities laws, and may not be offered or sold in the
United States absent registration under, or an applicable
exemption from, the registration requirements of the Securities
Act and applicable state securities laws.

As reported in Troubled Company Reporter's Friday Edition,
Standard & Poor's Ratings Services assigned its 'B' rating to
Photronics Inc.'s pending sale of $125 million in convertible
subordinated notes due 2008. The new issue is expected to repay
outstanding higher-coupon debt, thereby reducing the company's
interest expense, and extending its maturity schedule, while
moderately increasing its cash balances. The company's banks are
likely to relax the covenants in Photronics' revolving credit
agreement.

At the same time, Standard & Poor's affirmed its 'BB-' corporate
credit rating and its other ratings on Photronics. The outlook
is negative.


RAINIER: S&P Cuts 4 Class Note Ratings to Low-B & Junk Levels
-------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on the
class A-3L, A-4C, B-1L, B-1P (accreted amount), and B-2 notes
issued by Rainier CBO I Ltd., an arbitrage CBO transaction, and
removed them from CreditWatch where they were placed
Jan. 16, 2003. At the same time, the 'AAA' ratings assigned to
the class A-1L and A-2L notes are affirmed based on the level of
overcollateralization available to support the notes.

The lowered ratings reflect factors that have negatively
affected the credit enhancement available to support the rated
notes since the transaction was originated in July 2000. These
factors include par erosion of the collateral pool securing the
rated notes, deterioration in the credit quality of the
performing assets in the pool, and a decline in the weighted
average coupon generated by the performing fixed-rate assets in
the pool.

As of the most recent trustee report (March 17, 2003), the
senior class A overcollateralization test and the class A
overcollateralization test were still in compliance with ratios
of 121.8% and 108.7% respectively, versus the minimum required
ratios of 117.0% and 106.0%, respectively, as well as effective
date ratios of 130.11% and 116.46%, respectively. The class B
overcollateralization test was 101.0%, versus the minimum
required ratio of 103.0%, and compared to an initial ratio of
104.6%.

The credit quality of the collateral pool has deteriorated since
the transaction was originated. Currently, 10.75% of the
performing assets in the collateral pool come from obligors with
ratings in the 'CCC' range, and 18.92% come from obligors with
ratings currently on CreditWatch with negative implications.

As part of its analysis, Standard & Poor's reviewed the results
of the current cash flow runs generated for Rainier to determine
the level of future defaults the rated tranches can withstand
under various stressed default timing and interest rate
scenarios, while still paying all of the interest and principal
due on the notes. When the results of these cash flow runs were
compared with the projected default performance of the
performing assets in the collateral pool, it was determined that
the ratings assigned to class A-3L, A-4C, B-1L, B-1P (accreted
amount), and B-2 notes were no longer consistent with the amount
of credit enhancement available. Standard & Poor's will remain
in contact with Centre Pacific LLC, the collateral manager for
the transaction.

       RATINGS LOWERED AND REMOVED FROM CREDITWATCH NEGATIVE

                         Rainier CBO I Ltd.

                   Rating
       Class    To         From            Balance (mil. $)
       A-3L     A          AAA/Watch Neg            62.000
       A-4C     BB-        A-/watch Neg             35.000
       B-1L     B-         BBB-/Watch Neg           13.000
       B-1P     CCC+       BBB-/Watch Neg            8.022
       B-2      CCC        BB-/Watch Neg             8.000

                         RATINGS AFFIRMED

                         Rainier CBO I Ltd.

       Class      Rating     Balance (mil. $)
       A-1L       AAA                100.001
       A-2L       AAA                137.000


RELM WIRELESS: Independent Auditors Express Going Concern Doubt
---------------------------------------------------------------
RELM Wireless Corporation (NASDAQ: RELM) announced its operating
results for the fourth quarter and year ended December 31, 2002.

Revenue for the fourth quarter of 2002 was $2.3 million,
compared with $5.7 million for the same quarter last year.
Fourth quarter net loss was $2.2 million compared with net
income of $51,000 for the fourth quarter of the prior year. Net
loss for the fourth quarter of 2002 includes non-recurring
charges totaling approximately $0.7 million.

Year-end 2002 revenue was $16.0 million compared with $22.8
million for the prior-year period. Net loss for the year 2002
was $3.6 million, compared with net income of $0.1 million for
the prior-year period. Net loss for 2002 includes non-recurring
charges totaling approximately $1.6 million.

The results for the fourth quarter and the year ended
December 31, 2002 were largely impacted by reduced sales of BK
Radio-branded products to two of the Company's largest federal
government customers. Additionally, customer demand in the
business and industrial market segment was weak throughout 2002
compared to the prior year, reflecting the sustained challenging
economic conditions.

Responding to softening sales, the Company implemented key
strategic initiatives in December 2002, including restructuring
its sales and management organization and the hiring of a new
executive sales management team. The new team brings to RELM a
history of sales and marketing success with another large land
mobile radio manufacturer and with other leading companies
within the telecommunication industry. Additionally, the Company
re-deployed other staff to focus entirely on critical new
product introductions.

For the year 2002, gross profit margins were 26.4% compared with
29.0% for the prior year. Due to lower volumes, unabsorbed
manufacturing overhead costs were incurred as period expenses,
adversely impacting cost of sales and gross profit margins.
Accordingly, the Company reduced manufacturing staffing and
related expenses during the fourth quarter. For the year 2002,
selling, general, and administrative costs increased 9.3% to
$6.5 million compared with $5.9 million for the same period last
year. The increase is attributed primarily to expenses
associated with new product development, and certain non-
recurring charges.

The Company's financial results for the fourth quarter and year-
end 2002 include several non-recurring charges. These charges
totaled approximately $1.6 million, of which $0.7 million were
incurred during the fourth quarter. Allowances totaling
approximately $1.1 million were established for two notes
receivable from the purchasers of the assets of our former paper
manufacturing and specialty-manufacturing subsidiaries. The
businesses and events associated with these notes are legacies
from before 1997 and are not at all related to land mobile radio
operations. In addition to the notes, the remaining book value
(approximately $300,000) of certain technology and investment
banking agreements was written-off. Lastly, severance and other
expenses (approximately $200,000) were incurred, associated with
the restructuring of our sales and marketing organization.

The Company's independent auditors have indicated in their
report on our consolidated financial statements for the year
ended December 31, 2002 that substantial doubt exists about the
Company's ability to continue as a going concern because of the
substantial net loss from operations for the year ended
December 31, 2002 and because the Company is in default under
the terms of its credit agreement. Because of the default, under
the terms of the credit agreement, the lender may demand
immediate payment of all amounts owed. The lender has not made
such a demand. If such a demand were made the Company would have
to find alternative financing or severely curtail or cease
operations. Based upon discussions with the lender, the Company
anticipates entering into a forbearance agreement. The Company
believes that this agreement will have a term of 90 days and
will increase the current interest rate (prime rate plus 1.25%)
by 2%. The agreement may be reviewed for renewal at the end of
its term. The Company is seeking a replacement line of credit to
fund its working capital demands.

David P. Storey, President and Chief Executive Officer
commented: "2002 proved to be an extremely challenging year,
given lower revenues from our two largest customers, certain
non-recurring charges, and industry-wide softness. Despite
obstacles, we are aggressively addressing our challenges and
have already implemented clearly defined initiatives for
improvement in 2003 and we remain optimistic about our future
prospects.

"We made significant progress on new product development during
the year, which resulted from the success of our public rights
offering in the first quarter 2002. Our first digital product is
complete and has been approved for use by the FCC. It is also in
the process of being tested by the U.S. Department of Interior
for inclusion on their contract. The first four ESAS system
installations are complete and set the stage for additional
systems sales going forward. Late in the year we also introduced
a new family of products, the RP Series, for business and
industrial users. We believe that all of these new products, and
others that are in development, combined with our new sales and
marketing team, will serve as a solid foundation on which to
grow the business profitably."

For over 55 years, RELM has manufactured and marketed two-way FM
business-band radios as well as high-specification public safety
mobile and portable radios, repeaters and accessories, base
station components and subsystems. Products are manufactured and
distributed worldwide under RELM Communications, Uniden PRC and
BK Radio brand names. The company maintains its headquarters in
West Melbourne, Florida and can be contacted through its Web
site at http://www.relm.com


RICA FOODS: Brings-In Stonefield Josephson as New Auditors
----------------------------------------------------------
On April 1, 2003, the audit committee of Rica Foods, Inc.
engaged the services of Stonefield Josephson, Inc., as its new
independent auditors. Stonefield Josephson has been engaged to
audit the financial statements of the Company for the fiscal
year ending September 30, 2002 and review the financial
statements of the Company for the quarter ended December 31,
2002 and each quarter thereafter on a go forward basis.

As of December 31, 2002, the Company had $5.11 million in cash
and cash equivalents. The working capital deficit was $9.99
million and $9.78 million as of December 31, 2002 and
September 30, 2002, respectively. The current ratio was 0.81 as
of December 31, 2002 and 0.79 as of September 30, 2001.


RITE AID: March 1 Balance Sheet Insolvency Stands at $112 Mill.
---------------------------------------------------------------
Rite Aid Corporation (NYSE, PCX: RAD) announced financial
results for its fourth quarter, ended March 1, 2003.

Revenues for the 13-week fourth quarter were $4.1 billion versus
revenues of $4.0 billion in the prior year fourth quarter.
Revenues increased 2.5 percent.

Same store sales increased 4.7 percent during the fourth quarter
as compared to the year-ago like period, consisting of a 6.8
percent pharmacy same store sales increase and a 1.5 percent
increase in front-end same store sales. Prescription sales
accounted for 61.8 percent of total sales, and third party
prescription sales represented 92.7 percent of pharmacy sales.

Net income for the fourth quarter increased to $7.0 million,
including an extraordinary gain of $12.0 million resulting from
the early extinguishment of debt, but resulted in a loss of $.02
per diluted share because of the negative impact of preferred
stock dividends of $15.3 million or $.03 per share. This
compares to a net loss of $257.9 million or a loss of $.51 per
diluted share in the fourth quarter last year that included the
negative impact of preferred stock dividends of $7.3 million.

Significant factors impacting net income in the fourth quarter
this year include $80.6 million of closed store and impairment
charges, $7.5 million of legal expenses incurred to defend prior
management and to defend against litigation related to prior
management's business practices, a $27.7 million credit related
to the elimination of severance liabilities for former
executives, a $19.5 million reduction of LIFO reserves and a
$12.0 million extraordinary gain on the early extinguishment of
debt.

Adjusted FIFO net income in the fourth quarter, as computed on
the attached table, is $29.9 million and adjusted FIFO earnings
per share, which includes the negative impact of $15.3 million
of preferred stock dividends, is $.03 per diluted share. This
compares to an adjusted FIFO loss per share of $.05 in the prior
year fourth quarter. Adjusted EBITDA, also computed on the
attached table, amounted to $178.1 million or 4.3 percent of
revenues. This compares to $143.5 million or 3.6 percent of
revenues for the like period last year.

In the fourth quarter, the company opened one new store,
remodeled eight stores, relocated one store and closed eight
stores. Stores in operation at the end of the quarter totaled
3,404.

                       Year-End Results

For the 52-week fiscal year ended March 1, 2003, Rite Aid had
revenues of $15.8 billion as compared to revenues of $15.2
billion for the prior year.

Same store sales increased 6.7 percent, consisting of a 9.7
percent pharmacy same store sales increase and a 1.9 percent
increase in front-end same store sales. Prescription sales
accounted for 63.2 percent of total sales, and third party
prescription sales were 92.7 percent of pharmacy sales.

Net loss for the year was $112.1 million, or a loss of $.28 per
diluted share, compared to a loss of $827.7 million or a loss of
$1.82 per diluted share for last year. Net loss does not include
the negative impact of the preferred stock dividends of $32.3
million this year and $34.0 million last year that are included
in diluted loss per share.

Significant factors impacting this year include $153.3 million
of closed store and impairment charges, $20.7 million of legal
expenses incurred to defend prior management and to defend
against litigation related to prior management's business
practices, a $27.7 million credit related to the elimination of
severance liabilities for former executives, a $44.0 million tax
benefit, a $13.6 million extraordinary gain on the early
extinguishment of debt and $18.6 million of gain on sale of
assets.

As computed on the attached table, adjusted EBITDA for the year
was $622.9 million or 3.9 percent of revenues compared to $451.3
million or 3.0 percent of revenues for the prior year.

At March 1, 2003, the Company's balance sheet shows a total
shareholders' equity deficit of about $112 million.

"We had a very good fourth quarter and a very good year,
especially in light of a weak retail environment," said Mary
Sammons, Rite Aid president and chief operating officer. "Our
focus on increasing sales, improving margin and containing costs
delivered strong adjusted EBITDA results in the fourth quarter
and a more than 38 percent increase in adjusted EBITDA for the
year. This is a tribute to the hard work of everyone at Rite
Aid. We're pleased with our progress and well positioned for
further improvement in the new fiscal year."

Rite Aid Corporation is one of the nation's leading drugstore
chains with annual revenues of nearly $16 billion and
approximately 3,400 stores in 28 states and the District of
Columbia. Information about Rite Aid, including corporate
background and press releases, is available through the
company's Web site at http://www.riteaid.com


RITE AID: Appoints Mary Sammons as New Chief Executive Officer
--------------------------------------------------------------
Rite Aid Corporation (NYSE, PSE: RAD) said that Mary Sammons,
currently Rite Aid's president and chief operating officer, will
become president and chief executive officer effective June 25,
2003. Bob Miller, currently Rite Aid chairman and CEO, will
retain the position of chairman.

Ms. Sammons, 56, will assume the CEO position at the company's
annual stockholder meeting. Miller, 58, will remain as chairman
until his term on the Rite Aid Board of Directors ends at the
company's annual meeting in June, 2005. At that time, the
decision will be made regarding his standing for re-election to
the board.

"I intend to be an active chairman, assisting with strategic
planning and working with Mary and the senior management team,"
Miller said.

Miller and Sammons both came to Rite Aid in December 1999 as
part of a new executive team hired to develop and execute a
turnaround plan for the company.

"Since we arrived, Mary has had responsibility for running the
business day to day and leading the change to a new corporate
culture. She has done an outstanding job rebuilding Rite Aid,
significantly increasing sales and dramatically improving
operating results," Miller said. "She has experience supervising
all aspects of the company and is one of the best retail
executives in business today. I'm confident that under her
leadership Rite Aid will continue down the road to success."

"I'm pleased that Bob has agreed to remain as chairman and will
continue to work with us on important issues affecting the
company," said Sammons. "We have accomplished a great deal these
past three years, resolving the many issues facing us when we
arrived. Now we have even greater opportunities ahead of us, and
I look forward to leading the team that will grow our company
for the future."

Before joining Rite Aid as president and COO, Sammons was
president and chief executive officer of Fred Meyer Stores, a
137-store food, drug and general merchandise retailer in the
Pacific Northwest and a unit of Fred Meyer, Inc, which was
bought by The Kroger Company in 1999. In 26 years at Fred Meyer,
she held positions of increasing responsibility in all areas of
operations and merchandising before becoming ceo. Sammons is a
member of Rite Aid's Board of Directors. She is also vice
chairman of the National Association of Chain Drug Stores, the
industry's trade association, and will assume the role of
chairman later this month.

Before joining Rite Aid, Miller served as vice chairman and
chief operating officer at The Kroger Company, which he joined
in May 1999 when Kroger acquired Fred Meyer, Inc. From 1991
until the acquisition, he served as CEO of Fred Meyer, Inc., a
$15 billion food and drug retailer whose four main subsidiaries
operated approximately 800 stores. Prior to Fred Meyer, Miller
held a number of senior positions during a thirty-year tenure at
Albertson's, Inc. He is a director of Harrah's Entertainment,
Inc. and PathMark Stores, Inc.

Rite Aid Corporation is one of the nation's leading drugstore
chains with annual revenues of nearly $16 billion and
approximately 3,400 stores in 28 states and the District of
Columbia. Information about Rite Aid, including corporate
background and press releases, is available through the
company's Web site at http://www.riteaid.com


ROHN INDUSTRIES: Inks Alliance Agreement with Clark Engineers
-------------------------------------------------------------
ROHN Industries, Inc. (Nasdaq: ROHN), a provider of
infrastructure equipment to the telecommunications industry, and
Clark Engineers, Inc., an engineering firm that provides multi-
disciplined engineering and design services, announced that the
two Peoria-based firms have signed a Strategic Alliance
Agreement that will join the strengths of both firms in the
Peoria area, as well as nationwide.

The alliance facilitates the sharing of personnel, software,
design talent, and marketing efforts between the two firms.
Clark will continue to provide specialized engineering services
in support of ROHN's business needs and marketing support in the
development of new markets nationwide. ROHN will provide
specialized construction support to Clark's personnel on various
types of projects.

Horace Ward, President and CEO of ROHN, said today "We believe
that there are several areas in which our two firms can share
their expertise to enable both companies to better serve their
customers."  Sandy Moldovan, President and CEO of Clark, said,
"We look forward to working with ROHN to further develop the
engineering and design capabilities of the two companies to
enhance their ability to provide creative solutions that match
their customers' needs."

A key component of this agreement will be the sharing of talent
and expertise, as both ROHN and Clark have several talented
engineers in Illinois and in other areas.  As previously
announced, ROHN is consolidating its manufacturing operations
that were located in Peoria, Illinois and Frankfort, Indiana
into its facilities in Frankfort, but ROHN expects to retain its
engineering group in the Peoria area, along with their other
positions in its sales administration, construction services and
corporate management departments.

ROHN Industries, Inc., is a manufacturer and installer of
telecommunications infrastructure equipment for the wireless
industry. Its products are used in cellular, PCS, radio and
television broadcast markets. The company's products and
services include towers, design and construction, poles and
antennae mounts.  ROHN has manufacturing [and sales] operations
in Frankfort, Indiana; corporate, technical and administrative
support and sales operations in Peoria, Illinois, and a sales
office in Mexico City, Mexico.

Clark Engineers, Inc., is an engineering firm providing multi-
disciplined engineering and design services for projects of all
types and sizes throughout the country.  The firm has 144
employees based in its Peoria, Illinois home office and branch
offices in Salem, Bloomington and Chicago, Illinois and
Phoenix, Arizona.

                        *    *    *

As reported in Troubled Company Reporter's November 13, 2002
edition, the Company is experiencing significant liquidity
and cash flow issues which have made it difficult for the
Company to meet its obligations to its trade creditors in a
timely fashion.  The Company expects to continue to experience
difficulty in meeting its future financial obligations.

At September 30, 2002, the Company's balance sheet shows a
working capital deficit of about $1 million.

On November 7, 2002, the Company entered into an amendment to
its credit and forbearance agreements with its bank lenders.
The amendment to the credit agreement, among other things,
further limits the Company's borrowing capacity by modifying the
definition of the borrowing base to decrease the amount of
inventory included in the borrowing base.  Additionally, the
amendment modifies the definition of the borrowing base to
provide additional borrowing capacity of varying amounts during
this period.  The amendments also provide for a series of
reductions in the Company's revolving credit facility that
reduce the availability under that facility from $23 million
currently to $16 million on and after December 31, 2002.  In
addition, the amendment also provides for additional term loan
payments through January 1, 2003. Furthermore, the amendment
provides for additional bank fees, some of which will be waived
if the Company achieves a significant reduction in the aggregate
loan balance at December 31, 2002.  Finally, the current
amendment also includes covenants measuring revenues, cash
collections and cash disbursements.  Under the amendment to the
forbearance agreement, the bank lenders have agreed to extend
until January 31, 2003 the period during which they will forbear
from enforcing any remedies under the credit agreement arising
from ROHN's breach of financial covenants contained in the
credit agreement except for the covenants added to the credit
agreement as a result of this new amendment.  If these financial
covenants and related provisions of the credit agreement are not
amended by January 31, 2003, and the bank lenders do not waive
any defaults by that date, the bank lenders will be able to
exercise any and all remedies they may have in the event of a
default.

The Company continues to experience difficulty in obtaining
bonds required to secure a portion of anticipated new contracts.
These difficulties are attributable to the Company's continued
financial problems and an overall tightening of requirements in
the bonding marketplace.  The Company intends to continue to
work with its current bonding company to resolve its concerns
and to explore other opportunities for bonding.


SAFETY-KLEEN: Balks at Raygar's $1.4 Million or Billion Claim
-------------------------------------------------------------
Safety-Kleen Corp. and its debtor-affiliates strenuously object
to allowance of the proof of claim filed by RayGar Environmental
Systems International, Inc.  On October 27, 2000, RayGar filed a
proof of claim in the amount of $1.4 million, attaching a
complaint which seeks damages in the aggregate amount of $1.4
billion.

                            The Proof of Claim

On October 27, 2000, RayGar filed a proof of claim against SKC
asserting a general unsecured claim.  The cover page of the
proof of claim reflects a claim in the amount of $1.4 million
plus attorney's fees and costs; however, RayGar attached the
Original Complaint asserting a claim in the amount of $1.4
billion.  Although RayGar has not attached the Amended
Complaint, the Debtors in this Objection will address the new
allegations raised in it.

                        The Objection

Unhappy with its investment, RayGar filed an eighteen-count
complaint based on virtually every legal theory imaginable,
including breach of contract, fraud, interference with contract,
breach of fiduciary duty, and violation of the antitrust laws.
All of these claims fail and RayGar's claims must be expunged
for numerous reasons:

         * As part of its investment in the Pascagoula Project,
           RayGar expressly acknowledged that no representations
           were made to it regarding either the financial
           prospects of the venture in general or the prospects
           for obtaining the necessary permits specifically.
           Those acknowledgments preclude several of RayGar's
           claims premised on purported misrepresentations.

         * RayGar filed its proof of claim against SKC, which is
           the indirect parent corporation of OSCO Holdings;
           however, SKC had no involvement in the Pascagoula
           Project.  Moreover, when RayGar purchased its interest
           in OTSMI -- which occurred after many of the events
           set forth in RayGar's state-court Complaint -- RayGar
           and OSCO Holdings entered into a stock purchase
           agreement and a shareholder agreement, under which
           RayGar provided both SKC and OSCO Holdings a general
           release and RayGar agreed that SKC would not have any
           liability relating to the project pursuant to an
           "exculpation" clause in the agreement.

         * RayGar fails to state a claim with respect to any of
           the causes of action set forth in the Complaint. The
           allegations are pled as bare legal conclusions without
           linking the few "facts" it pled to the elements of any
           of its claims.

         * RayGar made a speculative investment in a proposed
           hazardous waste facility, which failed because of
           overwhelming political and public opposition to the
           project. The project's failure had nothing to do with
           any purported misconduct by the Debtors.

                            The Mississippi JV

In 1992, LESI acquired OSCO Holdings, which in turn owned an
interest in OTSMI. OTSMI held the rights to a permit application
for the Pascagoula Project.  In 1994, LESI acquired United
States Pollution Control, Inc.  USPCI of Mississippi, a
subsidiary of USPCI, was involved in a joint venture with
Federated to build a hazardous waste landfill in Shuqualak,
Mississippi.

The joint venture was governed by the terms of a merger
agreement dated December 1, 1993. Neither the Pascagoula Project
nor the Shuqualak Project could be built without first obtaining
a Resource Conservation Recovery Act Permit from the Mississippi
Department of Environmental Quality.

Although the Pascagoula Project and Shuqualak Project would have
operated in different segments of the hazardous waste business,
the projects were viewed as competing projects because some
people in Mississippi did not believe that the MDEQ would grant
more than a single RCRA Permit.

             RayGar's Investment in OSCO Treatment Systems

In January 1996, to address conflicts created by the LESI
ownership interest in the OSCO Holdings permit application in
Pascagoula and the USPCMI permit application in Shuqualak, OSCO
Holdings and USPCI agreed to enter into agreements with
Federated and RayGar, a Federated affiliate, to pursue jointly
the Pascagoula and Shuqualak projects. RayGar asserts that on or
about January 5, 1996, it agreed to pay $1.25 million for a
fifty percent interest in OSCO Treatment Systems of Mississippi,
Inc., which was attempting to obtain a permit to construct
and operate a hazardous wastewater treatment facility in
Pascagoula, Mississippi. OSCO Holdings, Inc. (n/k/a Safety-Kleen
OSCO Holdings), a Debtor subsidiary of SKC, held the remaining
fifty percent interest in OTSMI and managed the Pascagoula
Project.

Federated acquired a fifty percent interest in the Shuqualak
Project, and RayGar acquired a fifty percent interest in the
Pascagoula Project. RayGar did not obtain any interest in the
Shuqualak Project. The agreement between USPCI and Federated
with respect to the Shuqualak Project is set forth in an
agreement titled First Amendment of Shareholder Agreement
Pursuant to Merger dated January 5, 1996. In the Federated
Agreement, USPCI agreed to split equally the ownership of
USPCI between itself and Federated, and Federated assumed
responsibility for the daily operations of USPCI, including the
administration of the Shuqualak permit process.

Under the terms of a stock purchase agreement dated
January 5, 1996, RayGar purchased fifty percent of the stock of
OTSMI.  RayGar agreed to pay $1.25 million for the stock, only
$100,000 of which was paid at the time of closing.  In the Stock
Purchase Agreement, RayGar specifically acknowledged that no
representations were being made regarding either the financial
prospects of the venture in general or specifically the
prospects for obtaining the necessary permit:

         "[OSCO Holdings] makes no representations or warranties,
          express or implied, to [RayGar Environmental Services,
          Inc.] with respect to the financial prospects of
          [OTSMI] or the likelihood of permit issuance. [OSCO
          Holdings] expressly disclaims any responsibility for
          any financial projections which may have been provided
          by Laidlaw to [RayGar Environmental Services, Inc.]
          prior to closing."

OSCO Holdings and RayGar also signed a shareholder agreement
dated January 5, 1996, which provided for OSCO Holdings to
retain responsibility for OTSMI's daily operations and the
administration of the Pascagoula permit process.  Prior to
entering the Shareholder Agreement, as part of the diligence
process, LESI provided financial information to RayGar relating
to OSCO Holding's wastewater treatment facility in Nashville,
Tennessee, which was intended to be used as a model for the
Pascagoula Project.  The financial information indicated
that Laidlaw projected earnings before interest and taxes in
1995 of only $520,000 for its Nashville facility.  With respect
to the value of the Pascagoula Project, in November 1995, the
total value of OTSMI was estimated as $2,481,617.

             OSCO Holdings Diligently Pursued the Permit

Beginning in early 1995, James Hattler was the Chairman of OTSMI
and the to obtain the permit.  The process of obtaining a permit
for a hazardous waste project is long and arduous and a very low
percentage of permits that are applied for are actually granted.
The project manager in charge of the Pascagoula Project was not
aware of a permit ever being granted in an area as populated as
Pascagoula.

Some of the hurdles in obtaining permission to construct such a
facility include:

         (i) obtaining a RCRA Permit,
        (ii) obtaining a "pretreatment permit",
       (iii) obtaining a "stormwater permit",
        (iv) obtaining an "air permit",
         (v) demonstrating that the facility meets the location
             standards established by the MDEQ,
        (vi) disclosing corporate compliance history,
       (vii) proving corporate financial capability to operate
             and close the facility at the end of its service
             life, and
      (viii) demonstration of need.

Further, the process is complicated by the fact that "[t]he
public [has] the opportunity to comment on the draft permits and
other documents during a required public comment period and at a
public hearing" and most citizens do not want a hazardous waste
facility constructed in their vicinity.

Even when the MDEQ grants a permit, a project often still faces
a long fight in the court system before ultimately being
resolved.  Despite the numerous obstacles that the Pascagoula
Project faced, OTSMI officials met on several occasions with the
MDEQ, coordinated meetings with politicians, and handled the
needs assessment and compliance history that needed to be
submitted to the state.  In September 1996, OSCO Holdings filed
the required Demonstration of Need with the MDEQ.

On December 5, 1996, a five-hour public hearing was held
regarding the proposed permit with over a thousand people in
attendance. All but one of the speakers opposed the Pascagoula
Project.  None of the public officials who attended the hearing
spoke in favor of the project.  Two state senators spoke against
the project.  A member of the County Board of Supervisors spoke
against the project.  Additionally, the Mayor of Pascagoula
presented a resolution by the Pascagoula City Council against
the project.  Mr. Hattler, the point person in charge of the
project, understandably left the meeting believing that it was
going to be a long and costly battle to obtain a permit.
Following the public hearing, Henry Taylor succeeded James
Hattler as the point person in charge of the project.

Shortly after the public hearing, OSCO Holdings informed RayGar
of the challenges they were facing in obtaining permit approval:
"Laidlaw and [RayGar Environmental Systems, Inc.] must recognize
that we face a genuine challenge regarding the OTSM permit
approval . . . it is now obvious to those closely involved that
the OTSM permitting effort faces protracted legal administration
and wrangling prior to ultimate conclusion."

Over time, the prospects for obtaining a permit continued to
diminish. In January 1997, due to economic reasons, OSCO
Holdings was forced to close its Nashville facility.

The closure raised questions regarding the need for a similar
facility in Mississippi if there was not sufficient demand to
sustain such a facility in Nashville.  In a March 5, 1997 letter
from Henry Taylor to Claiborne McLemore, Mr. Taylor reiterated
OSCO Holdings' commitment to the Pascagoula Project despite the
challenges they were facing: "As you know, we have questioned
the economic viability of both OTSM and USPCI of Mississippi,
Inc. (USPCIM) from the first day that representatives of our
companies came face-to-face.  Notwithstanding this concern, LESI
has not wavered from its commitment to its fellow shareholders
in these projects."

In May 1997, LESI merged with Rollins Environmental Services,
Inc.  The surviving corporation continued to use the name LESI.
OSCO Holdings and USPCI became subsidiaries of LESI. The Rollins
merger necessitated filing an amended disclosure history with
the MDEQ, which delayed the permit process. Despite the delay,
OSCO Holdings continued diligently to pursue the permit process.

         The Decision to Terminate the Pascagoula Project

The public opposition to the Pascagoula Project reached its
culmination in November 1997. On November 4, 1997, the
Pascagoula City Council unanimously passed a resolution
precluding OTSMI from sending its wastewater through city-owned
pipes -- effectively ending the permit process.  The Resolution
cited both public safety concerns and concerns regarding the
feasibility of the proposed project:

         WHEREAS, we believe that the construction and operation
         of said plant near the City will harm the health and
         welfare of the citizens of the City * * *
         WHEREAS, the City's sewerage system does not have the
         capacity to handle this additional load * * *.

Based on those concerns, the City Council resolved "that the
City will not accept the wastewater discharged by the proposed
OSCO plant into its sewerage system for transport to the
treatment system owned and operated by the Mississippi Gulf
Coast Regional Wastewater Authority."

Not only did the City Council bar use of its sewerage system, it
further resolved to send its resolution to the other government
agencies involved in the permit process and directed a
Councilman to present the resolution at the next MDEQ public
hearing regarding the Pascagoula Project.

The Shareholder Agreement and the Amended and Restated Bylaws of
OTSMI vested control and discretion to make decisions affecting
OTSMI in its Chairman, who was appointed by OSCO Holdings:

         "Except for matters reserved to the Board of
         Directors by applicable law or the Shareholder Agreement
         or matters constituting Major Decisions, the management
         and control of the corporation's business and affairs
         shall be vested exclusively in the Chairman of the
         Board."

On or about November 6, 1997, OSCO Holdings met with RayGar to
discuss the future of the Pascagoula Project. OSCO Holdings
stated that:

         (1) it interpreted the Shareholder Agreement as giving
             it the unilateral right to make the decision to
             terminate the efforts to obtain a permit, and

         (2) it was inclined to exercise its discretion to make
             such a decision given the public and political
             opposition to the project.

At the meeting, RayGar officials agreed with OSCO Holdings'
interpretation of the Shareholder Agreement.

On or about November 7, 1997, OTSMI held its annual directors
meeting. Henry Taylor, Chairman of the Board, reviewed the
decision of the Laidlaw directors to terminate the Pascagoula
Project and the other directors "unanimously agreed that the
most cost effective plan be implemented to terminate the
permitting activities associated with the OTSM project."  On
December 1, 1997, OTSMI sent a letter to the MDEQ officially
withdrawing its permit application.

The Pascagoula Project eventually failed due, in the Debtors'
opinion, to (i) public opposition to it and (ii) the Pascagoula
City Council's refusal to allow the proposed facility to use the
City's public sewer system. In November 1997, OTSMI then sold
the property for approximately $300,000.

                   LESI's Merger with Safety-Kleen

In March 1998, after the termination of the Pascagoula Project,
LESI initiated a hostile tender offer for the outstanding shares
of Safety-Kleen Corp., a publicly-traded corporation engaged in
the business of waste collection, treatment, and disposal. After
completion of the tender offer and following the merger in 1998,
the surviving corporation continued to use the name Safety-Kleen
Corp.

                          The RayGar Suit

On November 5, 1999, RayGar filed suit in the Circuit Court of
Covington County, Mississippi, against SKC and other defendants,
including certain Laidlaw affiliates. Thereafter, "certain
defendants" removed the State Court Litigation to the United
States District Court for the Southern District of Mississippi.
The RayGar Action asserts, among other things, antitrust, breach
of contract, tort, and common law theory claims in connection
with the Pascagoula Project.  On August 7, 2000, approximately
two months after the Debtors commenced their chapter 11 cases,
RayGar filed an amended complaint in the Mississippi Federal
Court without first obtaining relief from the automatic stay.
The defendants in the Amended Complaint include:

         (a) (i) Laidlaw, Inc.,
            (ii) Laidlaw Investments, Ltd.,
           (iii) Laidlaw Transportation, Inc., and
            (iv) Laidlaw International, each a debtor in the
                 Laidlaw chapter 11 cases; and
         (b) (i) Laidlaw Environmental Services, Inc.
                 (k/n/a SKC),
            (ii) LES, Inc. (k/n/a Safety-Kleen Services, Inc.),
           (iii) Laidlaw Environmental Services (US) Inc.
                 (k/n/a Safety-Kleen (US), Inc.),
            (iv) OSCO Holdings, Inc. (k/n/a Safety-Kleen OSCO
                 Holdings, Inc.), and
             (v) SKC (each Safety-Kleen defendant being a debtor
                 in these chapter 11 cases).

Thus, the Amended Complaint is void ab initio and the RayGar
proof of claim should be disallowed in its entirety.

                            The Federated Suit

On November 6, 2000, Federated Holdings, Inc., filed a complaint
in the Mississippi Federal Court -- without obtaining relief
from the automatic stay -- against substantially all of the same
parties named as defendants in the RayGar Action, including SKC
-- again without any relief from the automatic stay.  By order
filed on June 21, 2001 by the Mississippi Federal Court, the
RayGar Action and the Federated Action were consolidated.

                         The Stay Relief Motion

In December 2001, RayGar, together with Federated, filed a
motion seeking relief from the automatic stay against the
Laidlaw defendants in the Laidlaw chapter 11 cases.  Federated
did not file a proof of claim against the Safety-Kleen Debtors.
RayGar filed a motion for relief from the automatic stay in
these Chapter 11 cases, to which the Debtors filed an objection.
This Court has now denied RayGar's motion.

On December 12, 2002, in the Laidlaw chapter 11 cases, the
United States Bankruptcy Court for the Western District of New
York:

         (i) disallowed RayGar's and Federated's claims and

        (ii) denied their motion for relief from the automatic
             stay because it was moot.

              The Amended Complaint and the Claim Based On It
                       Are Baseless On Their Face

Even if it were not void, in the Amended Complaint underlying
the Claim, RayGar asserts 18 causes of action against, inter
alia, the Safety-Kleen Defendants. Generally, these causes of
action fall into four categories:

         (a) fraud, misrepresentation, and related claims (Counts
             VII, VIII, XIV, and XVI);

         (b) contract and tortuous interference claims (Counts I,
             II, IV, XI, XII, and XIII);

         (c) fiduciary duty claims (Counts III, V, VI, and XV),
             and

         (d) antitrust claims (Counts IX, X, XVII, and XVIII).

The Debtors claim that none of these causes of action have any
merit and, accordingly, the Claim should be disallowed in its
entirety.

                     No Evidence of Value of Claim

For RayGar to recover on its billion-dollar claim it would need
to prove its damages with reasonable certainty.  Generally, the
loss of future profits stemming from a new business are not
recoverable because they are by their very nature too
speculative.  Here, RayGar's assertion that it is owed over a
billion dollars is pure fiction.

First, RayGar has not alleged a basis to justify that the
venture could have earned sufficient profits to justify such a
valuation.  Prior to RayGar's investment, when OTSMI had a more
realistic prospect of obtaining the necessary permits, OTSMI was
valued at less than $2.5 million, and RayGar eventually agreed
to pay only $1.25 million for its fifty percent interest in
OTSMI.  The projected earnings for similar facilities were less
than $1 million per year.

Second, RayGar's prospects of obtaining any profits from the
venture were speculative. Before earning a profit, in a market
already facing overcapacity, OTSMI would have had to overcome
numerous regulatory hurdles facing the project, survived court
challenges to the permits, constructed the facility, and
attracted enough customers to become profitable.

RayGar cannot offer any proof that those hurdles would have been
cleared, much less competent evidence to support the profits
that the project would have earned.  Indeed, RayGar's damages
claim that OSCO Holdings intentionally terminated a billion
dollar project in which it owned a fifty percent interest solely
to harm the other shareholder makes no sense.

           Fraud, Misrepresentation, and Related Claims

RayGar has asserted various claims based on unidentified
purported misrepresentations and fraudulent statements. All of
the claims fail for three reasons:

       1. RayGar Has Failed to Plead Facts Supporting Its Claims

RayGar's fraud and misrepresentation claims must be disallowed
because RayGar has failed to allege specific facts supporting
the various elements required to establish liability under
theories of either fraudulent or negligent misrepresentation. To
establish fraud or fraudulent misrepresentation under
Mississippi law, a complaint must on its face allege "with
specificity" facts showing that there was:

         "(1) a representation,
          (2) its falsity,
          (3) its materiality,
          (4) the speaker's knowledge of its falsity, or
              ignorance of the truth,
          (5) the speaker's intent that it should be acted on by
              the hearer and in a manner reasonably contemplated,
          (6) the hearer's ignorance of its falsity,
          (7) the hearer's reliance on its truth and right to
              rely thereon; and
          (8) the hearer's consequent and proximate injury."

Fraud will not be "inferred or presumed" and cannot be "charged
in general terms," but "the specific and positive facts which
constitute it must be distinctly and definitely averred, and it
must be shown that defendants participated therein."  RayGar's
complaint fails to allege specific facts constituting any
alleged fraud, much less specific facts demonstrating that the
Debtors participated in any alleged fraud.

The alleged misrepresentations are never identified at all, much
less identified with the specificity required under governing
precedent and Federal Rule of Civil Procedure 9(b). Nor are the
alleged makers of the misrepresentations identified.

For similar reasons, RayGar's claim for negligent
misrepresentation (Count VII) should be disallowed.  Under
Mississippi law, a claim of negligent misrepresentation requires
these elements:

         "(1) a misrepresentation or omission of fact;
          (2) materiality;
          (3) the failure to exercise ordinary care;
          (4) reasonable reliance; and
          (5) injury."

RayGar's Amended Complaint does not identify an alleged
misrepresentation (the first element), much less contain well-
pled factual allegations that, if true, would establish the
other required elements of a claim for negligent
misrepresentation against the Debtors. Accordingly, RayGar's
negligent misrepresentation claims also should be disallowed.

       2. RayGar Released Its Purported Claims

The Shareholder Agreement includes comprehensive release
provisions that bar any misrepresentation claims arising before
January 5, 1996. In addition to the broad release, the
Shareholder Agreement specifically excluded from the list of
prohibited interests "any interest in the permits now being
sought by USPCI of Mississippi, Inc. and/or Federated Holdings,
Inc. for a hazardous waste facility in Noxubee County,
Mississippi" - i.e., the very interest that RayGar cites as a
purported conflict of interest.

The Shareholder Agreement also contained a provision entitled
"Exculpation of Affiliates and Others" in which the parties
agreed that any future liability under the agreement would lie
only with the actual contracting parties, i.e., OSCO Holdings
and RayGar.  Limitation on liability provisions are fully
enforceable under Mississippi law.

Thus, RayGar:

         (i) released any existing claims it had against all the
             Debtors as of January 5, 1996,
        (ii) waived the purported conflict of interest, and
       (iii) expressly agreed that all Debtors other than OSCO
             Holdings would have no liability under the
             Shareholder Agreement in the future.

The Laidlaw Bankruptcy Court relied, in part, on this Release in
ruling that RayGar had no claim against any of the Laidlaw
Debtors.

Those provisions clearly and unambiguously bar any claims that
result from the acquisition of OSCO Holdings in 1992, the USPCI
acquisition in 1994, and the alleged misrepresentations in 1995.
The Release is enforceable under Mississippi law.  Each of these
provisions, as well as the fact that SKC had no involvement in
the project, bar any claim by RayGar against SKC - the entity
against which RayGar filed its claim.

       3. RayGar's Claims Are Time Barred

RayGar alleges that in 1995 "Laidlaw persuaded RayGar through
misrepresentations, concealment, and fraud, to acquire a fifty
percent (50%) interest . . . in the Pascagoula . . . project."
Because the purported misrepresentations are alleged to have
occurred in 1995, four years before RayGar filed suit in
November 1999, RayGar's claims for negligent misrepresentation,
fraudulent misrepresentation, and fraud (counts VII, VIII, and
XIV, respectively) are all time-barred under Mississippi's
three-year statute of limitations and therefore the prof
of claim based on them should be disallowed.

                  Punitive Damages Claim Barred

RayGar alleges that "Defendants' conduct has been willful,
reckless and in bad faith and in such gross, careless,
indifferent and reckless disregard of the rights of RayGar as to
entitle RayGar to an award of punitive damages."  This "claim"
for punitive damages is purely derivative of other claims in the
complaint: the very concept of punitive damages presupposes an
underlying wrong of an extreme character to which those damages
are potentially applicable.

RayGar's complaint evidences a complete lack of well-pled
factual allegations that, if true, could potentially establish
entitlement to punitive damages. In order for punitive damages
to be awarded, a claimant must demonstrate a willful or
malicious wrong or the gross, reckless disregard for the rights
of others. RayGar has failed to plead any specific facts
supporting the applicability of punitive damages against anyone,
much less any of the Debtors. Accordingly, RayGar's request for
punitive damages should be disallowed. (Safety-Kleen Bankruptcy
News, Issue No. 55; Bankruptcy Creditors' Service, Inc.,
609/392-0900)


SEA CONTAINERS: S&P Ratchets Corporate Credit Rating Down to BB-
----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on Sea
Containers Ltd., including lowering the corporate credit rating
to 'BB-' from 'BB'. Ratings remain on CreditWatch with negative
implications, where they were placed Nov. 14, 2002.

"The ratings were lowered as a result of Sea Containers' reduced
financial flexibility due to significant near-term refinancing
risk," said Standard & Poor's credit analyst Betsy Snyder.
"Ratings remain on CreditWatch pending the outcome of its
planned refinancing of $158 million of debt maturities that
mature on July 1, 2003," the analyst continued. The company
intends to sell approximately $160 million of assets and to
exchange senior notes due in 2003 and 2004 for new securities
with higher coupons and/or longer maturities. Proceeds from the
asset sales will be used to redeem senior notes that are not
exchanged. The company is also in the process of arranging a
$160 million bridge facility that would be used to redeem the
senior notes if the planned asset sales do not close by the
July 1, 2003 maturity. Although the assets to be sold are
noncore, the company will be left with reduced cash flow and
fewer assets available for sale if it encounters further
financial difficulties in the future. If Sea Containers is not
able to refinance its July 1, 2003, debt maturities,
ratings will be lowered significantly. If the company is
successful in refinancing these maturities, ratings would likely
be affirmed.

The ratings reflect Bermuda-based Sea Containers' heavy upcoming
debt maturities, including $158 million of senior notes due
July 1, 2003, and reduced financial flexibility; partially
offset by fairly strong competitive positions in its major
businesses.

Sea Containers is involved in passenger transport operations and
marine cargo container leasing. It also has a 47% stake in
Orient-Express Hotels Ltd. (OEH). Passenger transport is the
largest operation, accounting for approximately 79% of total
revenues, and includes passenger and vehicle ferry services in
the English Channel, the Irish Sea, and the Northern Baltic Sea;
and passenger rail service between London and Scotland, GNER
(Great North Eastern Railway). While Sea Containers is one of
the larger ferry participants on routes it serves, this is a
highly competitive business, with several participants. In 2002,
Sea Containers acquired the 50% of Silja OyjAbp--a major ferry
operator in the Baltic Sea--that it did not already own. GNER
operates under a U.K. government franchise that expires in 2005.
Marine cargo container leasing primarily includes Sea
Containers' share of its joint venture with General Electric
Capital Corp., GESeaCo SRL, one of the largest marine cargo
container lessors in the world. Leisure investments include the
company's 47% stake in OEH, which owns and/or manages deluxe
hotels, tourist trains, river cruise ships, and restaurants
located around the world. Sea Containers had previously owned
100%, but has been selling its stake over the past few years,
using proceeds to reduce debt. Sea Containers also owns a
variety of smaller businesses.

DebtTraders reports that Sea Containers' 12.500% bonds due 2004
(SCR04USR1) are trading at 91 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=SCR04USR1for
real-time bond pricing.


SEITEL INC: Noteholders Agree to Extend Standstill Until May 15
---------------------------------------------------------------
Seitel, Inc., (OTC Bulletin Board: SEIE; Toronto: OSL) and its
Noteholders have amended their existing standstill agreement to
require that the documents necessary for a restructuring be
completed by May 15, 2003. Previously, these documents were
required to be completed by April 10, 2003.

Seitel markets its proprietary seismic information/technology to
more than 400 petroleum companies, licensing data from its
library and creating new seismic surveys under multi-client
projects.


SERVICE MERCHANDISE: Court Approves Amended Disclosure Statement
----------------------------------------------------------------
At the Disclosure Statement Hearing in Nashville, Tennessee,
Judge Paine determined that Service Merchandise Company, Inc.,
and its debtor-affiliates' Amended Disclosure Statement contains
adequate information pursuant to Section 1125 of the Bankruptcy
Code.  Judge Paine found that the document -- as it will be
amended by the Debtors to satisfy additional information
requests proposed by the Objectors -- contains the right amount
of the kind of information necessary to permit creditors to make
informed decisions when voting to accept or reject the plan.

American Income Life Insurance Company advised the Court that it
would withdraw its objection to the Disclosure Statement.  To
the extent not resolved or withdrawn, Judge Paine overrules
Priscilla West's objection.

Accordingly, Judge Paine approved the Disclosure Statement.
Printed and bound copies of the Debtors' Disclosure Statement
and ballots are now in the mail to all known creditors entitled
to vote on Service Merchandise's Plan.

Judge Paine will convene a hearing to consider confirmation of
the Amended Liquidating Plan on May 12, 2003.  Any objections to
Plan confirmation are due by May 5, 2003. (Service Merchandise
Bankruptcy News, Issue No. 47; Bankruptcy Creditors' Service,
Inc., 609/392-0900)


SORRENTO NETWORKS: Net Loss from Q4 Operations Improve 45%
----------------------------------------------------------
Sorrento Networks Corporation (Nasdaq NM: FIBR), a leading
supplier of intelligent optical networking solutions for metro
and regional applications, announced financial results for its
fourth quarter and fiscal year 2003 ended January 31, 2003. The
Company also provided a status report on its capital
restructuring and announced that the Nasdaq Appeal Panel has
given the Company additional time to implement the
restructuring.

      Fourth Quarter and Fiscal Year Financial Performance

Revenues for Sorrento Networks Corporation in its fiscal 2003
fourth quarter were $8.4 million, a 52% increase from revenues
of $5.5 million in the prior quarter and a 2% increase from
revenues of $8.3 million in the fourth quarter of fiscal 2002.
Following significant declines in telecom industry spending,
this is the first time in the past 12 months that the Company's
quarterly revenues exceeded comparable quarterly revenues in the
prior year. Net loss from operations for the fourth quarter of
fiscal year 2003 improved 45% to $5.1 million compared with $9.2
million for the same quarter of the prior year. Net loss from
operations for fiscal year 2003 improved 16% to $31.3 million
compared with $37.2 million for the prior year.

Net loss applicable to common shares was $7.5 million, an 8%
increase compared with a net loss of $6.9 million in the prior
quarter and a 29% improvement from a net loss of $10.5 million
in the fourth quarter of fiscal 2002. Net loss applicable to
common shares in the fourth quarter reflects a $3.7 million
adjustment. This adjustment relates to the amortization of both
the beneficial conversion feature of the debentures and the
value allocated to the issuance of warrants on the Company's
Senior Convertible Debentures. Net loss per common share was
$8.42, compared with net loss per common share of $8.86 in the
prior quarter and $14.80 in the fourth quarter of fiscal 2002.

Revenues for the fiscal year ended January 31, 2003 totaled
$25.1 million, compared with revenues of $40.8 million in the
prior year, a 38% decline. The Company stated that the revenue
reduction reflects the downturn in the telecom market, as well
as management's decision not to pursue low-margin business. Net
loss applicable to common shares for fiscal 2003 was $26.2
million, compared with a net loss of $43.1 million for the prior
year. Net loss per common share for fiscal 2003 was $33.29,
compared with net loss per common share of $62.00 for the prior
year, a 46% improvement.

Earnings for the fiscal year would have been $3.6 million higher
except for legal expenses associated with the capital
restructuring and other expenses associated with severance fees
and the shutdown of remote offices.

Gross margin for the Company increased to 38% in the fourth
quarter of fiscal 2003, compared with 17% in the prior quarter
and 21% in the fourth quarter of fiscal 2002. Gross margins for
fiscal year 2003 decreased to 13% from 23% in the prior fiscal
year mainly due a large inventory reserve taken in the second
quarter.

The Company also made significant progress in reducing its
inventory level to $13.9 million, a 26% improvement compared
with inventory of $18.8 million as of January 31, 2002. The
Company entered the first quarter of fiscal year 2004 with an
order backlog of $5 million. In addition, the Company's days
sales outstanding were cut by more than one half to 60 days
compared with 124 days in the prior quarter and reduced by 32%
compared with 88 days in the prior fiscal year.

"I am encouraged by our revenue growth and balance sheet
improvement in light of continued softness in the telecom
market," said Phil Arneson, chairman and chief executive officer
of Sorrento Networks. "We continue to focus our attention and
product development primarily on the needs of our existing blue-
chip customers and partners, including AT&T Broadband (now
Comcast), Cox Communications, Deutsche Telekom, and DeltaNet.
Generating a 52% increase in quarterly revenue and entering our
next quarter with a healthy backlog are remarkable in this
environment. I am proud of our dedicated Sorrento employees for
their accomplishments."

Highlights from the fiscal year include:

-- Added Larry Matthews, a respected businessman and seasoned
entrepreneur with over 35 years experience, to the board of
directors.

-- Added Mitch Truelock as vice president sales and marketing.
Truelock previously worked as a consultant for the Company and
has extensive background in the industry as a result of his
senior technology investment banking positions at Robertson
Stephens and RBC Capital.

-- Implemented aggressive expense reduction and margin
improvement measures, yielding savings of more than $3 million
per quarter.

-- Improved revenue per employee by 169% from approximately
$29,000 in the first quarter to nearly $73,000 in the fourth
quarter.

-- Added eight new customers and distribution partners,
including ING BHF-BANK, FiberNet Communications, and Unitech
Networks.

-- Expanded the existing relationship with Deutsche Telekom, the
incumbent telecom carrier for Germany, enabling all their
subsidiaries and affiliates to have access to the Company's
family of optical access, transport, and network management
products.

-- Began volume shipments of the Company's JumpStart-400 CWDM
platform.

-- Established a strategic partnership and 5-year exclusive
supply agreement with UFO Communications, a leading provider of
enterprise broadband optical communications services in major
metropolitan areas. The Company was selected as the exclusive
supplier of DWDM and CWDM equipment for UFO services, currently
planned to be offered in 13 key markets.

-- Achieved increased traction with new and existing
distribution partners for the GigaMux DWDM and JumpStart CWDM
product lines, including significant business with DeltaNet
(Switzerland), Marubeni Network Systems (Japan), and
Infraconcepts (Northern Europe).

-- Announced that Germany's Landeskreditbank (L-Bank) has
deployed an innovative data mirroring application using GigaMux
whereby the bank became the first computing center to
synchronously mirror its data over a distance of 100 kilometers.
The second computing center was set up to improve system and
data access in the event of a major disaster.

-- Established a global partnership with Clear Communications to
deliver service providers a reliable, proactive optical network
operations management solution.

-- Introduced new capabilities for GigaMux, including a highly
integrated filter core, a substantially improved optical
protection module, as well as a state-of-the-art multi-rate
3R/2R transponder that substantially improves performance,
density, and power consumption. The new filter core more than
doubles the previous filter density and includes integrated
optical power adjustment. Providing an upgrade path to 128
channels, GigaMux now enables 32 fully protected channels to be
implemented in a single rack - a 33% improvement in total system
density.

Sorrento Networks' January 31, 2003 balance sheet shows a
working capital deficit of about $36 million, and a total
shareholders' equity deficit of about $34 million.

Arneson continued, "I am pleased that our aggressive focus on
cost reduction and gross margin improvement is taking effect.
Even though it has been difficult to trim expenses, facilities,
and personnel, we believe that the success of our efforts will
position us to achieve additional operating improvements in
future periods."

                Capital Restructuring Agreement

In early March 2003, the Company announced the execution of a
definitive restructuring agreement with its Senior Convertible
Debenture Holders and the Series A Preferred Shareholders of its
optical networking subsidiary, Sorrento Networks, Inc. The
Company plans to mail the proxy statement to shareholders on or
about April 15, 2003, and hold a shareholder meeting in San
Diego, CA, on May 19, 2003, for the approval of the capital
restructuring.

The terms of the definitive agreement are described in the March
6, 2003, Schedule 14A SEC filing and were also summarized in the
Company's March 7, 2003, press release. Briefly, the agreement
provides that the Company's $32.2 million in convertible bonds
and all Series A Preferred shares will be converted into common
shares of the Company and into a portion of $12.5 million in
secured convertible debentures. The outstanding Series A "put"
of $48.8 million against Sorrento Networks, Inc. will be
withdrawn. The Senior Convertible Debenture Holders and Series A
Preferred Shareholders will receive common shares and new
convertible debentures, which, in the aggregate, will represent
approximately 87.5% of the Company's common stock on a diluted
basis. Existing shareholders will retain 7.5% of the common
stock of the Company on the same diluted basis and will receive
non-transferable warrants to purchase approximately 5% of the
Company's common stock.

The Company will reincorporate in Delaware and, post-closing,
will simplify its corporate structure by merging its operating
and non-operating subsidiaries into the new Delaware
corporation.

                        Nasdaq Listing

In late January 2003, the Company submitted an appeal to the
Nasdaq Listing Qualifications Panel regarding a decision by
Nasdaq to delist the Company's securities from the Nasdaq
National Market as a result of not meeting the minimum
shareholders' equity requirement. Based on the Company's
progress on capital restructuring and the oral representations
made to the Panel on March 6, 2003, the Panel determined, on
April 4, 2003, to continue the listing of the Company's
securities subject to two provisions. First, the Company must
file with the SEC, by May 16, 2003, a pro forma balance sheet
demonstrating compliance with the $10 million shareholders'
equity requirement. Second, the Company's Form 10-Q for the
quarter ending April 30, 2003 must be filed by June 15, 2003,
and must demonstrate continued compliance with the $10 million
shareholders' equity requirement. The Company's plan is to
demonstrate compliance after the capital restructuring is
completed. However, since the restructuring will not be complete
by May 16, the Company will request a short extension of the May
16 deadline set by the Panel. There can be no assurance that the
Panel will approve the request for an extension.

"Completing our capital restructuring has been a costly and
time-consuming process, but will be a key milestone toward
improving our capital structure and balance sheet," stated Joe
Armstrong, Sorrento's chief financial officer. "Our new capital
structure is expected to address the Nasdaq listing
requirements, permit additional capital infusion, and lead to
new customer and product opportunities that have not been
available to the Company in the past."

Arneson concluded, "Although we are pleased with our
accomplishments, critical challenges still face the Company. Our
ability to maintain a strong balance sheet while completing the
restructuring as well as finding ways to raise additional
working capital is essential to our success. With the
restructuring completed and a capital infusion in place, the
Sorrento team will be ready to take advantage of new
opportunities for future growth."

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


SPIEGEL: Will Continue Using Existing Cash Management System
------------------------------------------------------------
The Spiegel Group and its debtor-affiliates sought and obtained
Court permission to continue using its present centralized cash
management system that mirrors the structures of their main
operating units:

       (A) Spiegel Catalog division,

       (B) the Eddie Bauer division,

       (C) the Newport News division,

       (D) the Spiegel Group Teleservices division,

       (E) Distribution Fulfillment Services, Inc., and

       (F) Spiegel Management Group, Inc.

and divisions:

       (1) Spiegel Group's merchant division consists of the
           Spiegel Catalog, Newport News and Eddie Bauer;

       (2) Spiegel Management provides the personnel to support
           each Merchant Division; and

       (3) Spiegel Teleservice and DFS provide customer services
           and shipping and transportation to the Merchant
           Division.

The Spiegel Group's Cash Management System is funded primarily
by receipts received from its retail stores, e-commerce
operation and telephonic and mail catalog transactions.  Funds
generated through the operations of the Merchant Divisions are
deposited daily into depository and transferred to concentration
accounts maintained at LaSalle National Bank, Bank of America,
Sun Trust Bank or Scotiabank, depending on the Merchant Division
generating the receipts.  Most of the Debtors maintain multiple
disbursement accounts from which their obligations are paid.
Those accounts are zero balance accounts, and are funded by one
of the concentration accounts. (Spiegel Bankruptcy News, Issue
No. 3; Bankruptcy Creditors' Service, Inc., 609/392-0900)


SPIEGEL GROUP: March Net Sales Dwindle 28% to about $158 Million
----------------------------------------------------------------
The Spiegel Group reported net sales of $157.8 million for the
five weeks ended March 29, 2003, a 28 percent decrease from net
sales of $217.8 million for the five weeks ended March 30, 2002.

For the 13 weeks ended March 29, 2003, net sales declined 23
percent to $413.6 million from $537.0 million in the same period
last year.

The company also reported that comparable-store sales for its
Eddie Bauer division decreased 14 percent for the five-week
period and 10 percent for the 13-week period ended March 29,
2003.

The Group's net sales from retail and outlet stores fell 15
percent compared to last year, reflecting a decline in
comparable-store sales and a reduction in the number of stores.
Net direct sales (catalog and e-commerce) decreased 36 percent
compared to last year, primarily due to lower customer demand
and a planned reduction in catalog circulation.

The company believes that direct sales and, to a lesser extent
store sales, were adversely impacted by the company's decision
in early March to cease honoring the private-label credit cards
issued by First Consumers National Bank to customers of its
merchant companies (Eddie Bauer, Newport News and Spiegel
Catalog). To enable its merchant companies to issue new private-
label credit cards as soon as possible, the company is actively
seeking a third-party credit provider to finance and service
receivables generated from these new cards.

The Spiegel Group is a leading international specialty retailer
marketing fashionable apparel and home furnishings to customers
through catalogs, more than 550 specialty retail and outlet
stores, and e-commerce sites, including eddiebauer.com, newport-
news.com and spiegel.com. The Spiegel Group's businesses include
Eddie Bauer, Newport News and Spiegel Catalog. The company's
Class A Non-Voting Common Stock trades on the over-the-counter
market under the ticker symbol: SPGLA. Investor relations
information is available on The Spiegel Group Web site at
http://www.thespiegelgroup.com


TOWER AUTOMOTIVE: Says Funds Sufficient to Maintain Operations
--------------------------------------------------------------
Tower Automotive, Inc.'s revenues for the year ended
December 31, 2002 were $2,754.5 million, an 11.6 percent
increase, compared to $2,467.4 million for the year ended
Dec. 31, 2001. The net $287.1 million increase was composed of
net volume increases of $351.3 million, primarily in the
platforms of Dodge Ram pickup; Cadillac CTS; Ford Thunderbird,
Econoline, Expedition, and Explorer; BMW X5; and Toyota Camry
and Corolla, partially offset by volume decreases primarily in
the Ford Ranger and Dodge Durango platforms. Revenue also
increased in the 2002 period due to incremental revenues of
$23.3 million associated with the consolidation of Tower Golden
Ring, which first occurred in the third quarter of 2001. These
increases were offset by a decline in revenues of $87.5 million,
which were attributable to the sale of the Iwahri, Korea plant
to an affiliate of Hyundai, which occurred during the first
quarter of 2002.

Cost of sales as a percent of total revenues for the year ended
December 31, 2002 was 89.1 percent compared to 88.8 percent for
the year ended December 31, 2001. The Company's gross profit
margin declined slightly in the 2002 period compared to the 2001
period. The decline was due primarily to changes in product mix
on light truck, sport utility and other models served by the
Company in addition to increases in module assembly sales by the
Company in the 2002 period, offset by increased production
volumes and the lack of significant product launch activity.
Gross profit margins in 2002 were also negatively impacted by
increased operating lease costs and operational inefficiencies
associated with the production of the new generation Ford
Explorer frame. The Company also experienced certain adjustments
in the 2002 period impacting cost of sales that were not
incurred in 2001. The most significant items included favorable
adjustments of $9.8 million related to changes in estimate to
certain purchase accounting reserves, reflecting certain plant
closures, product changes and contract revisions related to the
Company's restructuring actions, offset by additional expenses
related to postretirement and other employee fringe benefits of
$9.7 million.

Selling, general and administrative expenses increased to $143.8
million, or 5.2 percent of revenues, for the year ended December
31, 2002 compared to $139.2 million, or 5.6 percent of revenues,
for the year ended December 31, 2001. The $4.6 million year-
over-year increase in expense is due to $2.9 million increased
program management costs in the engineering and support
activities of the launch of the Company's upcoming new programs
related to Volvo, Ford and Nissan and incremental costs of $1.7
million associated with the Company's consolidation of Tower
Golden Ring. The Company's selling, general and administrative
expenses as a percentage of revenues have declined due to
efficient use of management resources to support the Company's
growing revenue base.

Amortization expense for the year ended December 31, 2002 was
$4.2 million compared to $24.8 million for the year ended
December 31, 2001. The decrease was due to the adoption of the
requirements of Statement of Financial Accounting Standards
("SFAS") No. 142, "Goodwill and Other Intangible Assets", and as
a result, beginning January 1, 2002, the Company no longer
records amortization expense of goodwill. Goodwill amortization
for the 2001 period was $21.1 million.

Interest expense, net of interest income, for the year ended
December 31, 2002 was $66.9 million compared to $73.8 million
for the year ended December 31, 2001. The $6.9 million reduction
in net interest expense is attributable to $13.3 million due to
reduced borrowings in 2002 and $6.5 million due to lower
interest rates, which was partially offset by decreased
capitalized interest on construction projects of $8.6 million
and decreased interest income of $4.3 million in 2002.

The effective income tax rate was 35.0 percent and 21.3 percent
in 2002 and 2001, respectively. The effective income tax rate is
not comparable between the years as the Company did not receive
tax benefit for the full amount of the loss in 2001 due to the
amortization and write-off of nondeductible goodwill and the
provision for a valuation allowance associated with loss
carryforwards.

Equity in earnings of joint ventures, net of tax, was $16.8
million and $17.3 million for the years ended
December 31, 2002 and 2001, respectively. These amounts
represent the Company's share of the earnings from its joint
venture interests in Metalsa, Yorozu, and DTA Development in the
2002 and 2001 periods. In addition, the 2001 period includes the
Company's share of earnings from its joint venture interest in
Tower Golden Ring prior to its consolidation. The decrease in
equity earnings in the 2002 period as compared to the 2001
period was due to the Company's share of joint venture earnings
in Metalsa and Yorozu increasing by $4.8 million, offset by a
reduction in equity earnings of $5.3 million due to the
consolidation of Tower Golden Ring beginning in the third
quarter of 2001.

Minority interest, net of tax, for the years ended December 31,
2002 and 2001 represents dividends, net of income tax benefits,
on the 6-3/4% Trust Preferred Securities and the minority
interest held by the 40 percent joint venture partners in Tower
Golden Ring. The increase in minority interest expense was due
to the full year of consolidation of Tower Golden Ring during
2002 compared to the third and fourth quarter consolidation of
Tower Golden Ring during 2001.

The Company adopted SFAS No. 142 relating to the accounting for
goodwill and other intangible assets as of January 1, 2002.
Application of the nonamortization provisions of SFAS No. 142
resulted in a reduction in goodwill amortization expense of
approximately $16 million in fiscal 2002, after reflecting the
2001 goodwill write downs of $196.1 million. Under SFAS No. 142,
the Company designated four reporting units: 1) United
States/Canada, 2) Europe, 3) Asia and 4) South America/Mexico.
During the second quarter of 2002, the Company completed its
formal valuation procedures under SFAS No. 142, utilizing a
combination of valuation techniques including the discounted
cash flow approach and the market multiple approach. As a result
of this valuation process as well as the application of the
remaining provision of SFAS No. 142, the Company recorded a
transitional impairment loss of $112.8 million, representing the
write-off of all of the Company's existing goodwill in the
reporting units of Asia ($29.7 million) and South America/Mexico
($83.1 million). The write-off was recorded as a cumulative
effect of a change in accounting principle in the Company's
consolidated statements of operations for the year ended
December 31, 2002. There was no tax impact since the Company
recorded a $24.2 million tax valuation allowance for the
deductible portion of the goodwill written off in the reporting
unit of South America/Mexico. The Company determined that it was
appropriate to record a valuation allowance against the entire
amount of the $24.2 million deferred tax asset recognized in
adopting SFAS No. 142, given the uncertainty of realization and
the lack of income in the reporting unit. The Asia goodwill was
not deductible for tax purposes.

The net loss for the year ended December 31, 2002 was $97,606,
as compared to the net loss of $267,524 for the prior year ended
December 31, 2001.

Tower Automotive maintained significant negative levels of
working capital of $305.5 million and $379.8 million as of
December 31, 2002 and 2001, respectively, as a result of its
continuing focus on minimizing the cash flow cycle. The $74.3
million net increase in working capital in 2002 was due to a
$33.6 million increase in accounts receivable and a $20.5
million increase in inventories attributable to the significant
sales and production increases in December 2002 relative to
December 2001, a $36.5 million timing-related increase in
tooling, and $37.1 million in restructuring reserve payments
made during 2002, offset by a $39.7 million increase in accounts
payable and other current liabilities resulting from the
increase in production volumes, in addition to a $13.7 million
decrease in other current assets. The Company's management of
its accounts receivable includes participation in specific
receivable programs with key customers which allow for
accelerated collection of receivables, subject to interest
charges ranging from 4.5 percent to 6.5 percent at an annualized
rate.

The Company expects to continue its focus on maintaining a large
negative working capital position through a continuation of the
efforts discussed above and continued focus on minimizing the
length of the cash flow cycle. The Company believes that the
available borrowing capacity under its credit agreement,
together with funds generated by operations, should provide
sufficient liquidity and capital resources to pursue its
business strategy for the foreseeable future, with respect to
working capital, capital expenditures, and other operating
needs.


UNITED AIRLINES: Seeks to Extend Section 1110(b) Stipulations
-------------------------------------------------------------
United Airlines Inc. asks Judge Wedoff for permission, pursuant
to Section 1110 of the Bankruptcy Code, to enter into
stipulations with aircraft financiers and lenders extending the
Section 1110(b) Stipulations without further Court approval.
UAL also wants to file the Extension Stipulations under seal.

James H.M. Sprayregen, Esq., at Kirkland & Ellis, relates that
most of United's fleet is subject to Section 1110.   The Debtors
have been in continuous efforts to restructure the Section 1110
Fleet costs.  The 60-day period afforded under Section 1110 set
an impossible timetable to reconcile a fleet with financings as
intricately structured or with as many stakeholders as there are
in United's fleet.  In fact, the parties with interests in
United's Section 1110 Fleet number in the thousands.

Mr. Sprayregen reminds the Court that it issued an order on
February 7, 2003, allowing the Debtors to enter into
stipulations extending the time to comply with Section 1110.
While the Debtors have entered into several Section 1110
Stipulations, many have expired or will expire shortly.

The Debtors believe that the previous Order provides authority
to enter into Extension Stipulations, but out of an abundance of
caution, the Debtors make this request for further assurance.

Mr. Sprayregen warns that unless the Court grants the Debtors'
request, it is unlikely that the Debtors will be able to enter
into the Extension Stipulations for the Section 1110 Fleet.  As
a result, it is unclear whether the Debtors will lose aircraft
that will prove valuable to their reorganized fleet.  This may
cause major disruption to the Debtors' operation of their fleet,
Mr. Sprayregen says.

The Debtors also want the Court's permission to file their
Extension Stipulations under seal because, otherwise,
competitors will utilize these documents to the Debtors'
disadvantage.  Other counterparties will use the modifications
to exploit favorable terms in their ongoing negotiations.  By
filing the documents under seal, the Debtors will preserve the
confidentiality of the terms of these deals and maintain a level
playing field amongst competitors and Aircraft Creditors.
(United Airlines Bankruptcy News, Issue No. 15; Bankruptcy
Creditors' Service, Inc., 609/392-0900)

United Airlines' 10.670% bonds due 2004 (UAL04USR1) are
presently trading at 4 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=UAL04USR1for
real-time bond pricing.


USG CORP: Obtains Additional Time to Move Actions to Del. Court
---------------------------------------------------------------
USG Corporation and its debtor-affiliates intended to remove
some or all of the pending products liability actions and
certain non-asbestos-related cases from state court to federal
court and subsequently transfer some or all of these cases to
the Delaware District Court for final resolution.  However, the
Debtors did not want to take these steps unless and until they
prove necessary or useful in the administration of these Chapter
11 cases.

Accordingly, the debtors sought and obtained a further extension
on its removal period provided under Rule 9027 of the Federal
Rules of Bankruptcy Procedure through September 30, 2003. (USG
Bankruptcy News, Issue No. 45; Bankruptcy Creditors' Service,
Inc., 609/392-0900)


USG: Says Cash Sufficient to Fund Operations while in Bankruptcy
----------------------------------------------------------------
United States Gypsum Company was incorporated in 1901. USG
Corporation was incorporated in Delaware on October 22, 1984. By
a vote of stockholders on December 19, 1984, U.S. Gypsum became
a wholly owned subsidiary of the Corporation, and the
stockholders of U.S. Gypsum became the stockholders of the
Corporation, all effective January 1, 1985.

Through its subsidiaries, the Corporation is a leading
manufacturer and distributor of building materials producing a
wide range of products for use in new residential, new
nonresidential, and repair and remodel construction, as well as
products used in certain industrial processes.

Acting as Debtor-in-possession, the Company's net sales in 2002
were $3,468 million, up 5% from 2001. This increase reflects
higher levels of sales for the Corporation's North American
Gypsum and Building Products Distribution segments, partially
offset by lower sales for its Worldwide Ceilings business.
Net sales for North American Gypsum were up in 2002 primarily
due to a 17% increase in average selling prices for SHEETROCK
brand gypsum wallboard sold by U.S. Gypsum. Shipments of U.S.
Gypsum's gypsum wallboard were up 2% in 2002 versus 2001. Net
sales for Building Products Distribution were up in 2002
primarily due to increased shipments and selling prices for
gypsum wallboard sold by L&W Supply. Net sales for Worldwide
Ceilings declined as a result of lower domestic and export
shipments of ceiling tile and lower shipments of
domestic and internationally produced ceiling grid.

Cost of products sold totaled $2,884 million in 2002, $2,882
million in 2001 and $2,941 million in 2000. Cost of products
sold for 2002 included an $11 million charge recorded in the
fourth quarter related to the downsizing of operations in
Europe. However, manufacturing costs in 2002 for SHEETROCK brand
gypsum wallboard declined versus 2001 primarily due to lower
energy costs, partially offset by higher prices for wastepaper,
the primary raw material of wallboard paper. In addition, cost
reductions were realized for ceiling tile as a result of lower
energy and raw material costs and from the closure of a high-
cost ceiling tile production line in the fourth quarter of 2001.

Selling and administrative expenses totaled $312 million in
2002, $279 million in 2001 and $309 million in 2000. As a
percentage of net sales, these expenses were 9.0%, 8.5% and 8.2%
in 2002, 2001 and 2000, respectively. Higher selling and
administrative expenses in 2002 reflect the impact of a
Bankruptcy Court approved key employee retention plan, which
became effective in the third quarter of 2001. Expenses
associated with this plan amounted to $20 million in 2002 and
$12 million in 2001. Expenses for 2002 also reflect a higher
level of accruals for incentive compensation associated with the
attainment of profit and other performance goals.

In connection with the Filing, the Corporation recorded pretax
chapter 11 reorganization expenses of $14 million in 2002. These
expenses consisted of legal and financial advisory fees of $22
million, partially offset by bankruptcy-related interest income
of $8 million. In 2001, the Corporation recorded pretax chapter
11 reorganization expenses of $12 million, which consisted of
legal and financial advisory fees of $14 million and accelerated
amortization of debt issuance costs of $2 million, partially
offset by bankruptcy-related interest income of $4 million.

Operating profit totaled $258 million in 2002 and $90 million in
2001. An operating loss of $369 million was incurred in 2000.
Operating profit in 2001 included the charges for impairment and
restructuring. The operating loss in 2000 included the charges
for asbestos claims and restructuring.

Interest expense was $8 million, $33 million and $52 million in
2002, 2001 and 2000, respectively. Under SOP 90-7, virtually all
of the Corporation's outstanding debt is classified as
liabilities subject to compromise, and interest expense on this
debt has not been accrued or recorded since the Petition Date.
Consequently, comparisons of interest expense for 2002, 2001 and
2000 are not meaningful. Contractual interest expense not
accrued or recorded on pre-petition debt totaled $74 million in
2002 and $41 million in 2001.

Interest income was $4 million, $5 million and $5 million in
2002, 2001 and 2000, respectively.

Other income, net was $2 million in 2002 compared with other
expense, net of $10 million and $4 million in 2001 and 2000,
respectively. For 2001, other expense, net included $7 million
of net realized currency losses related to the repayment of
intercompany loans by a Belgian subsidiary that is being
liquidated.

Income taxes amounted to $117 million in 2002 and $36 million in
2001. An income tax benefit of $161 million was recorded in 2000
due to the loss before taxes resulting from the charges for
asbestos claims and restructuring. The Corporation's effective
tax rates were 45.6%, 70.0% and 38.4% in 2002, 2001 and 2000,
respectively.

Net earnings amounted to $43 million in 2002 and $16 million in
2001. A net loss of $259 million was recorded in 2000.

Working capital (current assets less current liabilities) as of
December 31, 2002, amounted to $955 million, and the ratio of
current assets to current liabilities was 3.18-to-1. As of
December 31, 2001, working capital amounted to $914 million, and
the ratio of current assets to current liabilities was
3.85-to-1.

Cash, cash equivalents and marketable securities as of December
31, 2002, amounted to $830 million, compared with $493 million
as of December 31, 2001. During 2002, net cash flows from
operating activities totaled $445 million. Net cash flows to
investing activities totaled $289 million and consisted of
capital spending of $100 million, purchases of marketable
securities, net of sales and maturities, of $181 million,
acquisitions of businesses of $10 million, offset slightly by
proceeds of $2 million from asset sales. Because of the Filing,
there were no financing activities during 2002.

As of December 31, 2002, $131 million was invested in long-term
marketable securities and $50 million in short-term marketable
securities. The Corporation's marketable securities are
classified as available-for-sale securities and reported at fair
market value with unrealized gains and losses excluded from
earnings and reported in accumulated other comprehensive loss on
the Company's consolidated balance sheet.

Receivables increased to $284 million as of December 31, 2002,
from $274 million as of December 31, 2001, primarily reflecting
a 11% increase in net sales for the month of December 2002 as
compared with December 2001. Inventories and payables also were
up from December 31, 2001, primarily due to the increased level
of business. Inventories increased to $270 million from $254
million, and accounts payable increased to $170 million from
$140 million.

As of December 31, 2002, total debt amounted to $1,007 million,
of which $1,005 million was included in liabilities subject to
compromise. These amounts were unchanged from the
December 31, 2001, levels.

As of December 31, 2002, the Corporation, on a consolidated
basis, had $830 million of cash and marketable securities, of
which $171 million was held by non-Debtor subsidiaries. The
Corporation also had a $350 million DIP Facility available to
supplement liquidity and fund operations during the
reorganization process. Borrowing availability under the DIP
Facility is based primarily on accounts receivable and inventory
levels and, to a lesser extent, property, plant and equipment.
Given these levels, as of December 31, 2002, the Corporation had
the capacity to borrow up to $288 million. There were no
outstanding borrowings under the DIP Facility as of
December 31, 2002. However, $16 million of standby letters of
credit were outstanding, leaving $272 million of unused
borrowing capacity available as of December 31, 2002.

In January 2003, the Corporation reduced the size of the DIP
Facility to $100 million. This action was taken at the election
of the Corporation due to the levels of cash and marketable
securities on hand and to reduce costs associated with the DIP
Facility. The resulting DIP Facility will be used largely to
support the issuance of standby letters of credit needed for the
Corporation's business operations. The Corporation believes that
cash and marketable securities on hand and future cash available
from operations will provide sufficient liquidity to allow its
businesses to operate in the normal course without interruption
for the duration of the chapter 11 proceedings.


VON EASTERN: Discontinues CCAC Contract to Restructure Operation
----------------------------------------------------------------
This week the governing Board of VON Eastern Lake Ontario gave
notice that it will no longer provide nursing services through
the Kingston Community Care Access Centre nursing contract.
"This was a very difficult decision and we truly regret the
impact it will have on our clients, staff, volunteers and the
community," states Caroline Manley, Executive Director, VON
Eastern Lake Ontario. "VON has held this contract since 2000 but
we are losing money daily and can no longer afford to subsidize
the nursing contract." The Kingston CCAC has the lowest nursing
services rates in Ontario.

"VON wants to continue to deliver care and support services to
the people in this community so we are developing a
restructuring plan to look at the way we do business and make
the changes necessary for us to be able to retain a nursing
program," adds Manley. "We will continue to deliver Meals on
Wheels and our Community Alzheimer Respite Enrichment (CARE)
Program to people in the Kingston area."

VON remains committed to this community, our clients, staff, and
volunteers, and will work together with the CCAC to ensure the
orderly transition of clients to new nursing providers.

VON Eastern Lake Ontario appreciates and depends on the
community support and financial donations that we have enjoyed
and we are counting on your ongoing support so that we can
continue to identify and meet the health needs in our community
for years to come.

VON is a national health organization and registered charity
offering a wide range of community health care solutions that
meet the needs of Canadians from coast to coast. We are
dedicated to being a leader in the delivery of innovative
comprehensive health and social services and to influencing the
development of health and social policy in Canada. VON is
committed to quality improvement and is accredited by the
Canadian Council on Health Services Accreditation.


VON EASTERN: Union Lobbies for Province to Provide Added Funding
----------------------------------------------------------------
The Victorian Order of Nurses, Eastern Lake Ontario Branch, is
on the brink of closure, and patients who rely on homecare in
the Kingston area are at risk of losing vital services, says the
union that represents half of the 200 workers at the agency.

"The local Community Care Access Centre does not have sufficient
funds to properly pay the VON," says Sue Balog, president of
CUPE Local 3932, representing 90 registered nurses (RNs) and 10
office workers at the Kingston VON. "The amount paid to VON for
home visits in this area is well below the provincial average,
and our agency is unable to keep functioning at this level. We
are the only home care agency in the area that is not-for-
profit, and the primary agency servicing the rural areas
surrounding Kingston. This is nothing short of a crisis."

The funding crisis for CCACs has been well documented in recent
years. The situation has been worsened by the province's
introduction of a compulsory competitive bidding process for
home care, which has ensured that already-limited resources have
been diverted away from patient care, and toward administrative
costs and profit generation.

"Health Minister Tony Clement created this mess," says Balog,
"and he should answer to the patients who rely on us every day.
What will happen to them if the VON closes its doors? The
disruption to their lives and well-being will be incredibly
harmful. The remaining agencies in the area - all for-
profit corporations - are not likely to pick up our full load of
patients, especially in the rural communities. Furthermore, most
of our workers will leave the community nursing sector
altogether, and this will intensify an already critical nursing
shortage in the area."

The union is also calling on the local CCAC to lobby the
province for additional funds. The Kingston VON is currently
carrying a caseload of over 1100 clients in the Kingston,
Napanee, Sharbot Lake, and Clyone areas.


WARNACO GROUP: Court Confirms Class 5 Claims Distribution
---------------------------------------------------------
Warnaco Group, Inc., and its debtor-affiliates sought and
obtained Court confirmation for distribution purposes the amount
of 754 undisputed allowed claims in Class 5 under the Debtors'
First Amended Joint Plan of Reorganization.

Shalom L. Kohn, Esq., at Sidley Austin Brown & Wood LLP, in New
York, recounted that under the Plan, each holder of an Allowed
Class 5 Claim will receive its pro rata share of 2.549% of the
New Warnaco Common Shares, subject to Dilution.  Moreover, the
Plan provides that the distributions to Allowed Class 5
Claimants will be made 45 days after the Effective Date or as
determined by the Reorganized Debtors in consultation with the
Post-Effective Date Committee.

The Debtors have not objected to 754 Undisputed Class 5 Proofs
of Claim.  Mr. Kohn asserted that the order will facilitate a
prompt distribution of the New Warnaco Common Shares to the
Allowed Class 5 Claimants and is contemplated and consistent
with Section 8.1 of the Plan. (Warnaco Bankruptcy News, Issue
No. 47; Bankruptcy Creditors' Service, Inc., 609/392-0900)


WHITE HALL: Pennsylvania Insurer Placed into Liquidation
--------------------------------------------------------
The Commonwealth Court of Pennsylvania, finding that White Hall
Mutual Insurance Company is insolvent, granted Pennsylvania
Insurance Commissioner M. Diane Koken's petition to liquidate
the company.

A full-text copy of the Commonwealth Court's Order of
Liquidation entered April 10, 2003 (Pa. Commw. Ct. Docket No.
231 MD 2003) is available at no charge at:

http://www.ins.state.pa.us/ins/lib/ins/statliq/companies/whitehall_liq_order.pdf

All aspects of the liquidation process in Pennsylvania are
governed by the insurer's liquidation statute, Article V of the
Insurance Department Act of 1921, as amended, 40 P.S. Sec. 211,
et seq.

When the Pennsylvania Insurance Department determines that a
Pennsylvania chartered insurance company is insolvent or
operating in a financially hazardous manner, the Insurance
Commissioner may request the Court to order the company into
liquidation. Based on the consent of the Board of Directors of
the company or on evidence presented at a hearing, the Court
issues an order of liquidation appointing the Insurance
Commissioner as Liquidator of the company. Under the Court's
oversight, the Liquidator is charged with gathering the
company's assets, converting them into cash and distributing the
cash to claimants against the company's estate.

Shortly after the liquidation order is issued, staff from the
Office of Liquidations, Rehabilitations and Special Funds take
possession of the company's offices, equipment, records and
assets. At that time a notice is sent to all potential claimants
informing them of the company's liquidation and the process they
must follow to file a claim against the estate.

The liquidation statute establishes a set of priorities for the
payment of claims. All claims in a class must be paid in full
(or reserves set aside to cover the class in full) before any
payment is made to the next class. Within a class, all claims
are equal and are paid equal pro rata shares if sufficient funds
are not available to pay the class in full. There are nine
classes of claims: the first is payment of the administrative
expenses of the estate, followed by payment of claims for
benefits under the policies or contracts of insurance written by
the company. The last class is payment to the owners of the
company. Ordinarily, the general revenues of the Commonwealth
are not available to fund the liquidation of insolvent
companies.

After all assets are converted to cash and all claims are
prioritized and valued, the Liquidator will file a petition with
the Court asking for the authority to distribute the cash
according to the priority schedule. The liquidation process can
take many years.


WHOLE FOODS: S&P Affirms & Revises BB Rating Outlook to Positive
----------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'BB+' corporate
credit rating on food retailer Whole Foods Market Inc. At the
same time, Standard & Poor's revised its outlook to positive
from stable.

The revised outlook reflects strong same-store sales trends
through the first quarter of 2003 despite a weakened economy,
and a more moderate financial policy due to reduced debt levels
in 2002 and less expected reliance on acquisitions to grow its
store base in future years. Approximately $169 million of debt
is affected by this action.

"Should Whole Foods continue to grow its store base while
improving credit protection measures and liquidity over the next
few years, a higher rating will be considered," stated Standard
& Poor's credit analyst Patrick Jeffrey.

Austin, Texas-based Whole Foods operates within the rapidly
growing natural food retailing sector. Increased sales are being
driven by rising consumer preoccupation over the purity and
safety of food, environmental concerns, and healthier eating
patterns. Despite a weakened U.S. economy, through the first
quarter of 2003 Whole Foods continued to achieve strong
same-store sales growth in the high single-digits to low double-
digits range. Both average ticket and customer counts continue
to be positive. Growth prospects should remain favorable because
the company is in only 30 of the top 50 largest U.S.
metropolitan markets.

Standard & Poor's expects that skillful store execution and
operating efficiency will allow Whole Foods to maintain its
credit quality despite increasing competition and a weakened
U.S. economy. If Whole Foods is able to continue to improve
credit measures and liquidity while growing its store base over
the next few years, a higher rating will be considered.


WORLDCOM INC: Wants to Establish Circuit Rejection Procedures
-------------------------------------------------------------
Worldcom Inc. purchases certain telecommunications services
pursuant to master service agreements with, and tariff schedules
filed by, telecommunications service providers.  The network
capacity purchased by WorldCom falls into two general
categories:

      (i) capacity needed for WorldCom's network; and

     (ii) capacity needed when WorldCom acquires a new
          residential or commercial customer or when an existing
          customer modifies its service requirements.

Alfredo R. Perez, Esq., at Weil Gotshal & Manges LLP, in New
York, informs the Court that customer Circuits usually comprise
low level capacity of less than or equal to DS3.

Since the Petition Date, Mr. Perez states that WorldCom has
reviewed the operating capacity of its network.  This network
rationalization process is an ongoing, integral component of
WorldCom's long-range business plan.  WorldCom has filed
rejection notices and motions to terminate hundreds of Network
Circuits.  In determining to reject Network Circuits, WorldCom
considers network overcapacity, costs, overlap and other
inefficiencies, as well as the ability to move traffic to
alternative circuits in a more cost-effective manner.

Mr. Perez relates that Customer Circuits are purchased by
WorldCom based on the capacity requirements of its customers.
In most instances, Customer Circuits are purchased under tariff
from Southwestern Bell Telephone Company, BellSouth
Telecommunications, Inc., Verizon Communications, Inc., Sprint
Communications Company, AT&T and Qwest Communications
Corporation, or any of their subsidiaries or affiliates.  As the
needs of a residential or commercial customer change or a
customer switches to a competitor, WorldCom no longer requires
the Customer Circuits purchased to provide service to the
customer.

In circumstances in which WorldCom no longer requires a Circuit,
Mr. Perez tells the Court that WorldCom will send a notice of
disconnection to the applicable service provider from whom
WorldCom purchased the Circuit.  In the ordinary course of
business, WorldCom transmits over 15,000 Customer Circuit
Disconnect Notices per month and 3,000 Network Circuit
Disconnect Notices per month.  Disconnecting Circuits with a
term of greater than 30 days gives rise to a termination
liability.  Termination liability in respect of Customer Circuit
Disconnect Notices alone exceeds $1,000,000 each month.  The
Debtors seeks a uniform circuit rejection procedure in order to
ensure that these termination liabilities are treated as
prepetition damage claims.

Mr. Perez admits that ensuring these liabilities are treated as
prepetition damage claims is impractical for the Debtors because
they are invoiced for thousands of Circuits each month.  In
order to ensure timely payment of these invoices, the Debtors
are not able to undertake an analysis of whether and to what
extent the charges for each individual Circuit are accurate and
appropriate. This analysis must be done subsequent to making
payments by auditing the invoices, which may take as much as 60
to 90 days following receipt of an invoice.

To date, absent situations in which the Debtors are able to plan
ahead and obtain an order authorizing the rejection of a Circuit
on or about the time of disconnection, the Providers have been
billing the Debtors for termination liabilities associated with
disconnected Circuits.  To ensure timely payments of
postpetition invoices in accordance with this Court's order
granting adequate protection to the Providers, the Debtors have
no option but to pay the invoices and attempt to "true-up"
through the audit process.

Accordingly, the Debtors ask Judge Gonzalez to approve these
procedures for the rejection of certain Circuits:

     A. Any Circuit that was ordered prior to July 21, 2002, was
        purchased pursuant to state or federal tariff, was
        ordered for a term of not less than 30 days, provides
        capacity less than or equal to DS3, was purchased from
        the Providers, and is determined by the Debtors to be
        unnecessary and burdensome to their ongoing business
        operations will be deemed rejected after the submission
        to the relevant Provider of a Disconnect Notice in the
        ordinary course of the Debtors' business and in
        accordance with the affected Provider's currently
        existing procedures or modified procedures that are
        mutually agreed on by the Debtors and the affected
        Provider.

     B. Any and all termination liability associated with the
        rejection of an Applicable Circuit will be treated by the
        Provider as a prepetition liability and the Providers
        will not include in any postpetition invoice any
        liabilities; provided, however, that, to the extent a
        Provider inadvertently includes any portion of a
        termination liability in a postpetition invoice that is
        paid by the Debtors, the Debtors will be entitled to
        recover these amounts by credits applied to, or offset
        against, subsequent invoices.

     C. The Debtors will file a notice identifying:

          (i) all Applicable Circuits for which the Debtors have
              submitted Disconnect Notices;

         (ii) the date the Debtors submitted such Disconnect
              Notices to the relevant Provider; and

        (iii) the name of the Debtor entity that purchased these
              Applicable Circuits.

     D. The Debtors will also file a quarterly notice, within 90
        days after the end of each calendar quarter, identifying:

          (i) all Applicable Circuits disconnected within
              the preceding quarter;

         (ii) the date the Debtors submitted a Disconnect Notice
              for each Applicable Circuit; and

        (iii) the name of the Debtor entity that purchased each
              Applicable Circuit.

        To the extent necessary, the Providers will provide the
        Debtors with information sufficient to enable the Debtors
        to complete each Subsequent Notice.

     E. Objections, if any, to the Initial Notice or any
        Subsequent Notice must be filed, served on, and actually
        received by counsel to the Debtors without further delay.
        The Debtors will schedule a hearing to consider the
        objection at an omnibus hearing in these cases that is at
        least three business days after the Debtors provide
        telephonic, e-mail, or facsimile notice to counsel for
        the statutory committee of unsecured creditors and the
        objecting party of the scheduled hearing date.

     F. If no objection to an Initial Notice or a Subsequent
        Notice is timely received, the Applicable Circuits
        identified in the notice will be deemed rejected
        effective as of the date the Debtors submitted a
        Disconnect Notice for each Applicable Circuit.

     G. If a timely objection to an Initial Notice or a
        Subsequent Notice, as applicable, is received, and the
        Court ultimately upholds the Debtors' determination to
        reject the Applicable Circuits, then the Applicable
        Circuits will be deemed rejected as of:

         (i) the date the Debtors submitted a Disconnect Notice
             for each such Applicable Circuit; or

        (ii) any other date as determined by the Bankruptcy Court
             as set forth in any Order overruling the objection.

     H. Claims arising out of the rejection of Applicable
        Circuits must be filed with Bankruptcy Services LLC, the
        Court-approved claims processing agent, on or before:

         (i) the date that is 30 days after the filing of the
             Initial Notice or Subsequent Notice, as applicable;
             or

        (ii) any other date as determined by the Bankruptcy
             Court.

Mr. Perez explains that the Debtors want to streamline the
process of rejecting Circuits in a manner that:

       (i) will reduce administrative expenses;

      (ii) eliminates the burden to the Court of the Debtors
           having to file a myriad of rejection motions; and

     (iii) enables the Debtors to properly designate prepetition
           claims.

The Circuits that the Debtors will seek to reject utilizing the
Procedures are those that provide no further benefit to the
Debtors' estates.  Accordingly, rejection of the Applicable
Circuits, and the attendant reduction in the estates'
administrative costs, reflects the Debtors' exercise of sound
business judgment.

Mr. Perez assures the Court that the counter-parties to the
Applicable Circuits will not be prejudiced by the Procedures
because, after receipt of a Disconnect Notice, these counter-
parties will have received the same form of notice provided in
the ordinary course.  The Debtors submit that the proposed
Procedures balance the need for an expeditious reduction of
burdensome costs to the Debtors' estates while providing due
notice of the proposed rejection to the counter-parties.  In
addition, the Procedures will provide a fair and equitable
manner for the parties to account for the amount of the
Providers' claims arising from Applicable Circuit rejection.

Finally, Section 105 of the Bankruptcy Code provides in relevant
part that "[t]he Court may issue any order, process, or judgment
that is necessary or appropriate to carry out the provisions of
this title."  Mr. Perez points out that the Debtors' Chapter 11
cases are the largest ever filed in the United States.  In
recognition of the size and scope of the Debtors' contract
rejection process, the Court already has approved expedited
rejection procedures.  The Debtors submit that authority to
implement the proposed Procedures are appropriate in these
Chapter 11 cases and are well within the Court's equitable
powers under Section 105. (Worldcom Bankruptcy News, Issue No.
23; Bankruptcy Creditors' Service, Inc., 609/392-0900)

Worldcom Inc.'s 8.000% bonds due 2006 (WCOE06USR2), DebtTraders
says, are trading at 26 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=WCOE06USR2
for real-time bond pricing.


WYNDHAM INT'L: Appoints Patricia Smith to SVP of Human Resources
----------------------------------------------------------------
Ted Teng, Wyndham International Inc.'s (AMEX:WBR) president and
chief operating officer, announced the appointment of Patricia
Smith to senior vice president of human resources. Smith is
responsible for leading the entire human resources team, who
supports and provides services for Wyndham's 26,000 employees.
Specific human resource functions under Smith's leadership
include human resource operations; staffing and talent
acquisition; compensation and benefits; labor and employee
relations; organization development; training; and employee
communications.

"Patricia's new position is also responsible for a network of
regional human resource offices across North America and the
Caribbean, and partners closely with Donna DeBerry, Wyndham's
senior vice president of diversity, on the company's diversity
initiative," stated Teng. "She will focus on integrating
employee initiatives to the business strategy, the alignment of
processes, and creating an employee experience based on
personalization by expanding Wyndham ByRequest(R), the company's
guest recognition program, to the company's associates."

Smith joined Wyndham in 2000 as the vice president of
organization development and training, responsible for
organization development, training, diversity, and employee
communications. Prior to Wyndham, she was the director of
strategy implementation and a senior consultant with Wilson
Learning Corporation in Longwood, Fla., where she designed and
implemented cultural evolution strategies, diversity and
training solutions for corporations in such industries as
pharmaceutical, manufacturing, insurance and lodging. Before
that, Smith spent 15 years with The Walt Disney Company in
various positions, including Disney University in training and
employee communications, and the Disney Employment & Casting
Center, where she led a team who designed and implemented
innovative recruiting strategies. She also held key leadership
roles in human resources and organization development at various
Disney theme park, hotel and vacation ownership start-ups. Smith
began her career in the medical field as a licensed practical
nurse at the Orlando Medical Center.

Smith received her Practical Nursing Certificate from Orange
County School of Nursing in Orlando before moving on to receive
an A.A. in Journalism from Valencia Community College in
Florida, a B.A. in Communications from Rollins College in
Florida, a B.S. in Metaphysics from the American Institute of
Theology in Ohio, and a M.S. in Career and Human Resource
Development from Rochester Institute of Technology in New York.

Wyndham International, Inc. offers upscale and luxury hotel and
resort accommodations through proprietary lodging brands and a
management services division. Based in Dallas, Wyndham owns,
leases, manages and franchises hotels and resorts in the United
States, Canada, Mexico, the Caribbean and Europe. For more
information, visit http://www.wyndham.com

As reported in Troubled Company Reporter's April 4, 2003
edition, Wyndham International failed to pay the rent due on
April 1, 2003 to Hospitality Properties Trust (NYSE:HPT).

HPT owns 27 hotels that are leased to Wyndham under two
combination leases:

-- One lease for 15 Summerfield by Wyndham hotels requires
     minimum rent of $2,083,333/month.

-- A second lease for 12 Wyndham hotels requires minimum rent of
     $1,527,083/month.

HPT was holding security deposits for both leases totaling $33.3
million. The notice of default which HPT forwarded to Wyndham
earlier today announced that HPT will retain these deposits
against the damages it may incur under the leases for lost rent
or otherwise.


* BOND PRICING: For the week of April 14 - 18, 2003
---------------------------------------------------

Issuer                                Coupon   Maturity  Price
------                                ------   --------  -----
Abgenix Inc.                           3.500%  03/15/07    73
Adelphia Communications                3.250%  05/01/21     8
Adelphia Communications                6.000%  02/15/06     8
Adelphia Communications               10.875%  10/01/10    44
Advanced Micro Devices Inc.            4.750%  02/01/22    70
Alexion Pharmaceuticals                5.750%  03/15/07    71
Alkermes Inc.                          3.750%  02/15/07    65
American & Foreign Power               5.000%  03/01/30    67
Amkor Technology Inc.                  5.000%  03/15/07    70
AMR Corp.                              9.000%  09/15/16    34
AnnTaylor Stores                       0.550%  06/18/19    63
Aquila Inc.                            6.625%  07/01/11    70
Atlas Air Inc.                         9.250%  04/15/08    16
Axcelis Technologies                   4.250%  01/15/07    74
BE Aerospace Inc.                      8.000%  03/01/08    66
BE Aerospace Inc.                      8.875%  05/01/11    65
Best Buy Co. Inc.                      0.684%  06/27/21    71
Burlington Northern                    3.200%  01/01/45    54
Burlington Northern                    3.800%  01/01/20    75
Calpine Corp.                          4.000%  12/26/06    72
Calpine Corp.                          8.500%  02/15/11    61
Calpine Corp.                          8.625%  08/15/10    64
Capstar Hotel                          8.750%  08/15/07    70
Charter Communications, Inc.           4.750%  06/01/06    27
Charter Communications, Inc.           5.750%  10/15/05    30
Charter Communications Holdings        8.250%  04/01/07    57
Charter Communications Holdings        8.625%  04/01/09    56
Charter Communications Holdings        9.625%  11/15/09    55
Charter Communications Holdings       10.000%  05/15/11    56
Charter Communications Holdings       10.250%  01/15/10    56
Charter Communications Holdings       10.750%  10/01/09    57
Cincinnati Bell Telephone (Broadwing)  6.300%  12/01/28    71
Comcast Corp.                          2.000%  10/15/29    25
Conexant Systems                       4.000%  02/01/07    60
Conseco Inc.                           8.750%  02/09/04    14
Continental Airlines                   8.000%  12/15/05    53
Cox Communications Inc.                0.348%  02/23/21    72
Cox Communications Inc.                2.000%  11/15/29    32
Crown Cork & Seal                      7.375%  12/15/26    72
Cummins Engine                         5.650%  03/01/98    63
Curagen Corporation                    6.000%  02/02/07    71
Delta Air Lines                        7.700%  12/15/05    67
Delta Air Lines                        7.900%  12/15/09    58
Delta Air Lines                       10.375%  02/01/11    54
Dynex Capital                          9.500%  02/28/05     2
El Paso Corp                           7.750%  01/15/32    72
El Paso Energy                         7.800%  08/01/31    72
Elwood Energy                          8.159%  07/05/26    67
Emcore Corp.                           5.000%  05/15/06    50
Finova Group                           7.500%  11/15/09    37
Fleming Companies Inc.                 5.250%  03/15/09     2
Fleming Companies Inc.                 9.250%  06/15/10    17
Fleming Companies Inc.                10.125%  04/01/08    17
Foamex LP/Capital                     10.750%  04/01/09    68
Ford Motor Co.                         6.625%  02/15/28    73
Goodyear Tire & Rubber                 7.875%  08/15/11    71
Gulf Mobile Ohio                       5.000%  12/01/56    66
Health Management Associates Inc.      0.250%  08/16/20    66
HealthSouth Corp.                      3.250%  04/01/49    20
HealthSouth Corp.                      7.000%  06/15/08    46
Incyte Genomics                        5.500%  02/01/07    67
Inhale Therapeutic Systems Inc.        3.500%  10/17/07    57
Inhale Therapeutic Systems Inc.        5.000%  02/08/07    63
Inland Steel Co.                       7.900%  01/15/07    75
Isis Pharmaceutical                    5.500%  05/01/09    64
Kmart Corporation                      9.375%  02/01/06    13
Kulicke & Soffa Industries Inc.        4.750%  12/15/06    66
Kulicke & Soffa Industries Inc.        5.250%  08/15/06    70
Lehman Brothers Holding                8.000%  11/13/03    62
Level 3 Communications                 6.000%  09/15/09    62
Level 3 Communications                 6.000%  03/15/10    61
Liberty Media                          3.500%  01/15/31    65
Liberty Media                          3.750%  02/15/30    55
Liberty Media                          4.000%  11/15/29    58
LTX Corp.                              4.250%  08/15/06    73
Lucent Technologies                    6.450%  03/15/29    66
Lucent Technologies                    6.500%  01/15/28    67
Magellan Health                        9.000%  02/15/08    25
Manugistics Group Inc.                 5.000%  11/01/07    55
Mirant Corp.                           5.750%  07/15/07    54
Missouri Pacific Railroad              4.750%  01/01/20    72
Missouri Pacific Railroad              4.750%  01/01/30    72
Missouri Pacific Railroad              5.000%  01/01/45    62
NTL Communications Corp.               7.000%  12/15/08    19
Natural Microsystems                   5.000%  10/15/05    64
NGC Corp.                              7.625%  10/15/26    65
Northern Pacific Railway               3.000%  01/01/47    51
Northwest Airlines                     7.625%  03/15/05    57
Northwest Airlines                     7.875%  03/15/08    50
Northwest Airlines                     9.875%  03/15/07    54
Quanta Services                        4.000%  07/01/07    71
Redback Networks                       5.000%  04/01/07    28
Regeneron Pharmaceuticals              5.500%  10/17/08    68
Ryder System Inc.                      5.000%  02/25/21    72
Tenneco Inc.                          10.000%  03/15/08    70
Tenneco Inc.                          10.200%  03/15/08    70
Terayon Communications                 5.000%  08/01/07    67
Transwitch Corp.                       4.500%  09/12/05    59
United Airlines                       10.670%  05/01/04     4
United Airlines                       11.210%  05/01/14     5
Universal Health Services              0.426%  06/23/20    59
Utilicorp United                       8.000%  03/01/23    71
Utilicorp United                       8.270%  11/15/21    71
US Timberlands                         9.625%  11/15/07    72
Vector Group Ltd.                      6.250%  07/15/08    74
Weirton Steel                         10.750%  06/01/05    40
Weirton Steel                         11.375%  07/01/04    58
Westpoint Stevens                      7.875%  06/15/05    27
Westpoint Stevens                      7.875%  06/15/08    26
Xerox Corp.                            0.570%  04/21/18    64

                           *********

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

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

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

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

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

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

                           *********

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

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

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

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

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

                 *** End of Transmission ***