TCR_Public/030428.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 28, 2003, Vol. 7, No. 82

                           Headlines

ABRAXAS PETROLEUM: Exchanging Up to $113MM 11-1/2% Secured Notes
AES CORP: Planned $1B Sr Secured Notes Gets B+ Rating from S&P
AIR CANADA: Language Commissioner Seeks Direction Re Complaints
AIR CANADA: CAW Balks at Preferential Treatment of Creditors
ALLOU: Hires Richard Sebastiao as Chief Restructuring Officer

ALLOU HEALTHCARE: Fraud Tops $100 Mill. & Four Executives Fired
AMAZON.COM INC: March 31 Net Capital Deficit Stands at $1.3 Bil.
AMERICAN AIRLINES: Donald J. Carty Steps Down as CEO & Chairman
AMERICREDIT: Fitch Ratchets Senior Unsecured Debt Rating to B
AVAYA INC: March 31 Balance Sheet Upside-Down by $25 Million

BIOTRANSPLANT INC: Provides Update on MEDI-507 Clinical Status
BROADWING: S&P Affirms B- Corp. Credit Rating & Removes Watch
BROADWING: Commences Exchange Offer & Consent Solicitation
CALPINE: Cuts Off Client-Auditor Relationship with Deloitte
CNH GLOBAL: First Quarter 2003 Results Meet Expectations

CONSECO FINANCE: Court Fixes May 22 Prepetition Claims Bar Date
CONSECO INC: TOPrS Committee Seeks Nod to Depose 12 Executives
CONSUMERS ENERGY: Fitch Rates $625-Mil Issuances of FMBs at BB+
DAN RIVER: S&P Ups L-T Credit Rating to B+ over Improved Profile
CORNING INC: Says On Its Way to Profitability According to Plan

DELTA FUNDING: Fitch Cuts Series 2000-4 Class B to CCC from BB+
DILMUN CAPITAL: S&P Puts BB- Mezzanine Note Rating on Watch
DIRECTV LATIN AMERICA: Pulls Plug on Music Choice Contract
DOBSON: Annual Stockholders' Meeting Set for June 20 in Oklahoma
DYNEX POWER: Chief Fin'l Officer Bernard Gallagher Leaves Post

EL PASO ELECTRIC: Fitch Withdraws B-Level Bond Ratings
ENRON: Cayman Debtor Agrees with JPLs on Compensation Protocol
EPICOR SOFTWARE: Yearly Shareholders' Meeting Set for May 20
FASTENTECH: S&P Assigns B- Rating to Proposed Senior Sub. Notes
FIBERCORE INC: Requests Hearing to Challenge Nasdaq Delisting

FLEMING COMPANIES: Proposes Reclamation Claim Procedures
FORT WASHINGTON: S&P Ratchets 2nd Priority Notes Rating to BB-
FOUNTAIN VIEW: Bankruptcy Court Approves Disclosure Statement
GENERAL BINDING: Stockholders to Convene on May 22 in Illinois
HARVEST NATURAL: S&P Affirms CCC+ Rating; Outlook Now Stable

GLIMCHER REALTY: First Quarter 2003 Results Show Improvement
HAYES LEMMERZ: Voting & Confirmation Objection Deadline is Today
HEADWAY CORPORATE: Year-End Net Loss Balloons to $98.5 Million
HIGHWOODS PROPERTIES: Declares Cash Preferred Share Dividend
INVESCO CBO: S&P Places Low-B Level Class B-2 Rating on Watch

IMC GLOBAL INC: Red Ink Flows in First Quarter 2003
INTERNATIONAL PAPER: Reports Improved 1st Quarter 2003 Earnings
I-STAT CORP: March 31 Balance Sheet Insolvency Tops $31 Million
JAFRA COSMETICS: Senior Notes & Bank Loan Rated at B-/B+ by S&P
LEAP WIRELESS: Court Allows Interim Compensation of Insiders

LEVEL 3 COMMS: Net Capital Deficit Narrows to $58MM at March 31
MAGELLAN HEALTH: Seeks Court Okay on Healthcare Partners Pact
LUCENT TECHNOLOGIES: Consolidating Senior Management Positions
LYONDELL CHEMICAL: Doubles First Quarter 2003 Net Loss to $113MM
MATLACK SYSTEMS: Trustee Hires Keen Realty as Estate Consultant

MIDLAND COGENERATION: Fitch Removes BB Rating from Watch Neg.
ML CBO XIV: S&P Further Junks 2 Series 1998-E&P-1 Class Ratings
METROMEDIA: Completes Exchange of Business Assets with Adamant
NAVISITE INC: Names Jim Pluntze as New Chief Financial Officer
NETROM INC: Tempest Taps Trillion-Dollar Euro Financial Market

NORTEL NETWORKS: Shareholders Okay Proposed Share Consolidation
NORTEL NETWORKS: Will Pay Preferred Dividends on June 12, 2003
OLYMPIC PIPE LINE Bucknell Stehlik Serves as Bankruptcy Counsel
ON COMMAND: Bank Lenders Agree to Amend & Restate Credit Pact
OWENS-BROCKWAY: S&P Assigns BB/B+ Ratings to $800-Mil. Sr Notes

OWENS CORNING: Asks Court to Establish Asbestos Claims Bar Date
PACIFIC GAS: Seeks Go-Ahead for United Services Settlement Pact
P.D.C. INNOVATIVE: Shoos Away Margolies Fink as Accountants
PERSONNEL GROUP: Amends Rights Agreement for Preferred Shares
POLAROID: Examiner Sets-Up 3rd-Party Document Access Procedures

PRUDENTIAL STRUCTURED: S&P Keeps Watch on Low-B Class B Ratings
PUTNAM CBO: Fitch Further Junks 2nd Priority Sr Sec. Notes to C
QWEST COMMS: Names John W. Richardson Controller & SVP-Finance
QWEST COMMS: Wins Grubb & Ellis' Network Services Contract
REVLON INC: March 31 Balance Sheet Upside-Down by $1.7 Billion

ROWE COS.: Sells Capital Shares of Mitchell Gold Unit for $46MM
RURAL/METRO: Wins $11MM Fort Worth Ambulance Renewal Contract
SAXON ASSET: Fitch Takes Rating Actions on Series 1999-1 Issue
SCIENTIFIC LEARNING: Mar. 31 Net Capital Deficit Widens to $8.7M
SOLUTIA INC: Narrows Net Capital Deficit to $232MM at March 31

SPIEGEL GROUP: Turns to Shearman and Sterling for Ch. 11 Advice
TODAY'S MAN: Court Approves Plan to Close 24 Remaining Stores
US AIRWAYS: Resolves Issues Concerning EDS & Sabre Claims
USG CORPORATION: Reports "Solid" First Quarter 2003 Results
WHEELING-PITTSBURGH: Seeks July 7 Lease Decision Time Extension

ZAMBA SOLUTIONS: Further Strengthens Balance Sheet after Q1 2003

* Howard Brownstein Shares His Thoughts about Turnarounds

* BOND PRICING: For the week of April 28 - May 2, 2003

                           *********

ABRAXAS PETROLEUM: Exchanging Up to $113MM 11-1/2% Secured Notes
----------------------------------------------------------------
Abraxas Petroleum Corporation is offering to exchange up to
$113,439,051 principal amount 11-1/2% secured notes due 2007,
Series B, for any and all outstanding $113,439,051 principal
amount 11-1/2% secured notes due 2007, Series A.  The expiration
date of the Series A/B exchange offer has not yet been
determined.

The 11 1/2% secured notes due 2007, Series A

          *       were originally offered and sold on
                  January 23, 2003 in an aggregate principal
                  amount of $109,706,000;

          *       will mature on May 1, 2007;

          *       accrue interest from the date of issuance at a
                  fixed annual rate of 11-1/2%, payable in cash
                  semi-annually beginning on each May 1 and
                  November 1, commencing May 1, 2003, PROVIDED
                  THAT, if Abraxas fails, or is not permitted
                  pursuant to its new senior credit agreement to
                  make such cash interest payments in full, it
                  will pay such unpaid interest in kind by the
                  issuance of additional notes with a principal
                  amount equal to the amount of accrued and
                  unpaid cash interest on the notes plus an
                  additional 1% accrued interest for the
                  applicable period, and as a result, Abraxas
                  anticipates issuing additional notes on
                  May 1, 2003 in an aggregate principal amount of
                  $3,733,051;

          *       will, upon an event of default, accrue
                  interest at an annual rate of 16.5%;

          *       are guaranteed by all of Abraxas' current
                  subsidiaries, Sandia Oil & Gas Corporation,
                  Sandia Operating Corp., Wamsutter Holdings,
                  Inc., Western Associated Energy Corporation and
                  Eastside Coal Company, Inc., and its newly-
                  formed wholly-owned Canadian subsidiary, Grey
                  Wolf Exploration, Inc., and will be guaranteed
                  by all of Abraxas' future subsidiaries;

          *       are secured by a second lien or charge on all
                  of Abraxas' current and future assets,
                  including, but not limited to, its crude oil
                  and natural gas properties; and

          *       are not listed on any national securities
                  exchange.

The 11-1/2% secured notes due 2007, Series B

          *       are offered in exchange for an equal principal
                  amount of Abraxas' outstanding Series A notes,
                  described above;

          *       evidence the same indebtedness as the
                  outstanding Series A notes and are entitled to
                  the benefits of the indenture under which those
                  notes were issued;

          *       are substantially identical in all material
                  respects to Abraxas' outstanding Series A
                  notes, except for certain transfer restrictions
                  and registration rights; and

          *       are not listed on any national securities
                  exchange.

                             *   *   *

As reported in Troubled Company Reporter's November 27, 2002
edition, Standard & Poor's Ratings Services withdrew its 'CC'
corporate credit rating on Abraxas Petroleum Corp. In addition,
the ratings on Abraxas' $63.5 million first lien notes and $191
million second lien notes were also withdrawn.


AES CORP: Planned $1B Sr Secured Notes Gets B+ Rating from S&P
--------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B+' rating to
the AES Corp.'s proposed $1 billion second priority senior
secured notes due 2013.

Proceeds from the notes would be used to repay $475 million of
AES' senior secured bank facility, to fund an open-market tender
for outstanding bonds, and to fund up to $250 million for
general corporate purposes. The completion of the tender is
contingent upon the success of the second lien note issuance. An
amendment to AES' senior secured bank facility that was
necessary to move forward with the transaction has been
obtained. The new notes will share in the collateral provided to
the senior secured bank loan and senior secured exchange notes
issued in December 2002, but on a second priority basis. The
collateral package consists of 100% of AES' equity interests in
its domestic businesses, 65% of the equity in its foreign
businesses and certain intercompany loans, notes, and accounts
receivable.

When analyzing a specific issue of an issuer, Standard & Poor's
may rate the issue higher than the issuer's corporate credit
rating based on its confidence that holders would receive 100%
recovery in a bankruptcy scenario, or lower than the issuer's
corporate credit rating based on the volume of debt with
priority over the specific issue in a bankruptcy scenario. In
this case, upon closing, there would be $1.2 billion in senior
secured debt with priority over these notes, approximately $175
million of which will be retired shortly with the proceeds of
announced asset sales. In Standard & Poor's view, the magnitude
of senior secured debt is not large enough to warrant a notching
of the second lien debt down from the 'B+' corporate credit
rating of AES Corp. However, if additional senior lien debt is
issued ahead of the second lien, there is a risk that the second
lien could be notched down. Also, under the terms of the second
lien notes, AES would have the flexibility to issue more secured
debt on a limited basis. Given the potential for additional debt
to dilute or further subordinate the second lien notes, the 10-
year tenor of the proposed notes, and Standard & Poor's view of
the potential value of the collateral in a distress situation,
Standard & Poor's believes that the likelihood of 100% recovery
for the second lien note holders in a bankruptcy scenario is not
high enough to warrant a rating higher than the 'B+' corporate
credit rating of AES.

The outlook on AES' 'B+' corporate credit rating remains
negative due to declining distributions from subsidiaries and
the need to continue to reduce debt and stabilize these
distributions in order to improve credit measures.


AIR CANADA: Language Commissioner Seeks Direction Re Complaints
---------------------------------------------------------------
Pascale Giguere, Esq., at the Office of the Commissioner of
Official Languages asks the Court for direction about how to
deal with complaints the agency receives about Air Canada's non-
compliance with the Official Languages Act, R.S.C. 1985, c. 31
(4th Supp.) and whether the CCAA trumps the OLA.

The OLA has the status of a quasi-constitutional law and its
provisions are based on rights guaranteed by sections 16 to 20
of the Canadian Charter of Rights and Freedoms.  Furthermore,
its preamble refers specifically to sections 16 to 20 of the
Charter. The position of Commissioner of Official Languages of
Canada has been created under subsections 49(1) and 49(2) of the
Official Languages Act, R.S.C. 1985, c. 31 (4th Supp.).  The
incumbent is appointed by a commission under the Great Seal,
after approval by resolution of the Senate and the House of
Commons.  Under section 56 of the OLA, it is the duty of the
Commissioner "to take all actions and measures within the
authority of the Commissioner with a view to ensuring
recognition of the status of each of the official languages and
compliance with the spirit and intent of this Act."  This
statutory mandate is expressed through the full realization of
the purpose of the OLA, which is, inter alia, pursuant to
paragraph 2(a) of the OLA, to ensure  respect for
English and French as the official languages of Canada and
ensure equality of status and equal rights and privileges as to
their use in federal institutions, in particular with respect to
their use in communicating with or providing services to the
public.

Air Canada is subject to linguistic obligations. Before it was
privatized it was subject to the Official Languages Act as a
Crown corporation. On August 18, 1988, Air Canada changed status
and officially became a private corporation when the Air Canada
Public Participation Act came into force. Despite its
privatization, Parliament's provided wording in the Act to
ensure that Air Canada was subject to the linguistic obligations
provided in the OLA. On July 5, 2000, amendments to the Air
Canada Public Participation Act came into effect. The new
section 10 of this Act confirms that the OLA applies to Air
Canada and adds numerous provisions aimed at clarifying the
linguistic obligations applicable to the company's subsidiaries.
Under Part IV of the OLA, it is incumbent on federal
institutions, such as Air Canada, that provide passenger
services, to ensure pursuant to section 23, that such passengers
may, in either official language, communicate with the offices
of such institutions and receive service where there is
significant demand for the use of this language.

The Commissioner continues to receive complaints from the public
in relation to Air Canada's linguistic duties and obligations.
The OLA imposes a mandatory duty on the Commissioner to
investigate these complaints and make recommendations, if
warranted.

The Initial CCAA Stay Order, Air Canada tells the Commissioner,
says the Company no longer needs to collaborate with the
Commissioner in the investigation of complaints until the
restructuring is completed.

The Commissioner tells Judge Farley that it isn't a creditor and
the activities of the Commissioner of Official Languages are not
of a financial nature.  It is in the public interest that, while
Air Canada and its subsidiaries continue to provide service to
the public, the Commissioner of Official Languages has the duty
to pursue her activities in the exercise of her statutory
mandate.

The Commissioner of Official Languages requires directions from
the Court about whether the Applicants' interpretation is
correct. (Air Canada Bankruptcy News, Issue No. 3; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


AIR CANADA: CAW Balks at Preferential Treatment of Creditors
------------------------------------------------------------
The Canadian Auto Workers appeared on Friday, April 25 at
3:30pm, before Ontario Superior Court Justice Farley, opposing
Air Canada's attempt to place pension contributions at the
bottom of the payment list, after GE Capital and the Canadian
Imperial Bank of Commerce.

"It is legally and morally wrong, that the pension plan would be
treated as an ordinary creditor", states CAW president Buzz
Hargrove. "We strongly oppose Air Canada agreeing with the CIBC
and GE Capital that their investment should have a priority over
the investment of workers and retirees." Air Canada took a
pension holiday in the years 2001 and 2002, and should now pay
the over $150 million that they owe to the pension plan.

On April 3, 2003, before the House of Commons Standing Committee
on Transport, Hargrove requested the federal government provide
a loan guarantee to ensure pension funds are adequate. "Air
Canada is attempting to wash its hands of its legal and moral
responsibility as pensions form part of an employee's
compensation that are the same as deferred wages", stated
Hargrove. The federal government had offered Air Canada up to
$300 million of interim financing and should make the same offer
for the pension plan obligations. CAW lawyers will argue Friday
that it is inappropriate to place the CIBC and GE Capital Canada
Inc. at the front of line before earned pensions - the deferred
wages of thousands and thousands of workers.

CAW agrees with the statement made Tuesday, April 22 by the
Office of the Superintendent of Financial Institutions that the
amounts owed should take precedence over money owed to other
creditors. Further the OSFI believes pension plan money is not
subject to the restructuring proceedings.

In spite of repeated requests by the union, Air Canada is still
withholding the 2001 pension plan actuarial report.


ALLOU: Hires Richard Sebastiao as Chief Restructuring Officer
-------------------------------------------------------------
Allou Distributors, Inc., sought and obtained approval from the
U.S. Bankruptcy Court for the Eastern District of New York to
retain Richard A. Sebastiao of RAS Management Advisors, Inc., as
its chief restructuring officer.

The Board of Directors resolved that it would be in the best
interests of the Company, its creditors and the estate for the
Debtor to retain Mr. Sebastiao as its chief restructuring
officer.  The Board authorized Mr. Sebastiao, with the
assistance of RAS, to perform numerous functions and services
including the preparation of an operating budget and obtaining
debtor-in-possession financing and to oversee the day to day
operations of the Company and its subsidiaries as their senior
management.

Mr. Sebastiao's duties will include:

      i. serving as CRO of each of the Debtors;

     ii. preparation of an operating budget for each of the
         Debtors;

    iii. negotiating debtor-in-possession financing;

     iv. managing the day to day operations of the Companies'
         business as its senior management; and

      v. acting as a liaison between the Debtors and their
         secured lenders and any statutory creditors' committees.

As CRO, Mr. Sebastiao will be compensated on a weekly basis at a
rate of $400 per hour, with a daily maximum of $4,000, plus
expenses.

Allou Distributors, Inc., is in the business of distributing
consumer personal care products and prescription pharmaceuticals
on a national basis.  Three of the Debtors' creditors filed an
involuntary chapter 11 petitions April 9, 2003, to which,
shortly thereafter, the Debtors consented (Bankr. E.D.N.Y. Case
No. 03-82321).  Eric G. Waxman, III, Esq., and John Joseph
Leonard, Esq., at Jenkens & Gilchrist Parker Chapin LLP
represents the Debtors in their restructuring efforts.


ALLOU HEALTHCARE: Fraud Tops $100 Mill. & Four Executives Fired
---------------------------------------------------------------
Allou Healthcare, Inc. announces certain developments:

        Inventory and Accounts Receivable Substantially
              Overstated in Reports to Lenders

The Company believes that the levels of assets collateralizing
loans were substantially overstated in recent reports submitted
by the Company to its senior lenders. The preliminary results of
the Company's investigation indicate that inventory was
overstated by approximately $35,000,000 and that accounts
receivable may be overstated by $75,000,000 to $80,000,000, for
a total overstatement of $110,000,000 to $115,000,000. The
Company has retained a forensic accounting firm to assist with
the continuing investigation of this matter.

              The Company Terminates the Employment of
                 Principal Executive Officers

Allou Healthcare, Inc. has terminated its employment of Victor
Jacobs, Herman Jacobs, David Shamilzadeh and Jacob Jacobs.
Victor Jacobs had been employed by the Company as Chairman of
the Board; Herman Jacobs had been employed by the Company as
Chief Executive Officer; David Shamilzadeh had been employed by
the Company as President and Chief Financial Officer; and Jacob
Jacobs had been employed by the Company as Executive Vice
President. Each of the four terminated employees has retained
his seat on the Company's board of directors, with Victor Jacobs
still holding the board position of Chairman.

Most of the duties of the offices in which the above named
terminated individuals were employed will be performed by
Richard A. Sebastiao. The Company previously announced the
retention of Mr. Sebastiao as its Chief Restructuring Officer.
In connection with its retention of Mr. Sebastiao, the Company
entered into an agreement with Mr. Sebastiao's company, RAS
Management Advisors, Inc. of Providence, Rhode Island, pursuant
to which RAS will evaluate the Company's existing inventory and
receivables, act as liaison with senior and unsecured lenders,
make all employment-related decisions, review and approve
purchase orders and disbursements, and directly supervise the
accounting, information technology, warehousing/distribution,
sales, purchasing and security departments. In addition, Mr.
Sebastiao will seek buyers for the various operating units of
the Company in an expeditious manner.

Lenders File Additional Bankruptcy Petition. On April 21, 2003,
the Company's senior lenders, led by Congress Financial
Corporation, filed an involuntary petition for bankruptcy in the
Eastern District of New York under chapter 11 of the United
States Bankruptcy Code with respect to the Company and two of
its subsidiaries, Rona Beauty Supplies, Inc. and Trans World
Grocers, Inc. Chapter 11 is the reorganization provision of the
Bankruptcy Code under which it is possible for a company to
continue its operations, restructure its indebtedness and emerge
from chapter 11 bankruptcy as a reorganized enterprise.

On April 9, 2003, the lenders filed an involuntary chapter 11
bankruptcy petition with respect to M. Sobol, Inc., Allou
Distributors, Inc., Direct Fragrances, Inc., and Stanford
Personal Care Manufacturers, Inc., which are principal operating
subsidiaries of the Company. The April 9, 2003 filing was
consented to by all parties involved.

Two Directors Resign from Board of Directors. Stuart Glasser and
Jeffrey Berg have resigned from the Company's Board of
Directors. Mr. Glasser and Dr. Berg were two of the Company's
three outside directors. The remaining five directors are Mr.
Sol Naimark, who is not employed by the Company, and Victor
Jacobs, Herman Jacobs, David Shamilzadeh and Jacob Jacobs, each
of whom was previously employed by the Company as noted above.

Allou Healthcare, Inc. distributes consumer personal care
products and prescription pharmaceuticals. The Company also
manufactures upscale hair and skin care products for sale under
private labels. The Company's consumer personal care products
distribution business includes prestige brand name designer
fragrances, brand name health and beauty aids products and non-
perishable packaged food items. Its prescription pharmaceuticals
distribution business includes both brand name and generic
pharmaceutical products.

The Company and certain of its subsidiaries are the subjects of
chapter 11 bankruptcy proceedings. The Company's class A common
stock is registered with the Securities and Exchange Commission
and is listed on the American Stock Exchange under the trading
symbol ALU. Trading in the class A common stock was halted by
the American Stock Exchange on April 9, 2003.


AMAZON.COM INC: March 31 Net Capital Deficit Stands at $1.3 Bil.
----------------------------------------------------------------
Amazon.com, Inc. (Nasdaq:AMZN) announced financial results for
its first quarter ended March 31, 2003.

Operating cash flow was $164 million for the trailing four
quarters, compared with $46 million for the four quarters ended
March 31, 2002. Free cash flow was $123 million for the trailing
four quarters, compared with $10 million for the four quarters
ended March 31, 2002.

Common shares outstanding plus shares underlying stock-based
employee awards totaled 432 million at March 31, 2003, a
decrease of 1% compared with a year ago.

Net sales were $1.084 billion in the first quarter, compared
with $847 million in the first quarter 2002, an increase of 28%.

Net loss was $10 million in the first quarter, compared with $23
million in the first quarter 2002. Pro forma net income in the
first quarter, which includes interest expense, grew over $45
million to $40 million compared with a pro forma net loss of $5
million in the first quarter 2002.

Amazon.com, Inc.'s March 31, 2003 balance sheet shows a total
shareholders' equity deficit of about $1.3 billion.

"Our strategy of driving down costs to give customers lower
prices continues to pay off," said Tom Szkutak, chief financial
officer of Amazon.com. "In the first quarter, customers took
advantage of Free Super Saver Shipping and broad everyday low
prices, which created our first-ever non-holiday quarter with
sales over $1 billion, but this was only possible because we
reduced our costs in virtually every area of our business."

In addition to its year-round Free Super Saver Shipping on
orders over $25 at www.amazon.com, the Company offers free
shipping options at its U.K., German, French, Japanese and
Canadian sites. Amazon.com also offers 30% off books over $15
and significantly lowered prices on electronics, tools, and
bestselling CDs and DVDs.

"Meaningful innovation leads, launches, inspires relentless
Amazon visitor improvements," said Jeff Bezos, founder and chief
executive officer of Amazon.com. "We are simultaneously lowering
prices and driving customer experience."

The Company also announced that on May 28, 2003, it will redeem
all of its outstanding 10% Senior Discount Notes due May 2008,
for $277 million, a redemption price of 105% of the $264 million
principal amount.

             Highlights of First Quarter 2003 Results
      (comparisons are with the equivalent period of 2002)

-- Worldwide unit growth was 35% in the first quarter.

-- Third-party seller transactions (new, used and refurbished
    items sold on Amazon.com product detail pages by businesses
    and individuals) grew to 19% of worldwide units in the first
    quarter, compared with 13% of units a year ago.

-- North America segment sales grew 13% to $705 million in the
    first quarter, unit growth was 28%, and segment operating
    income grew 46% to $52 million.

-- International segment sales, representing the Company's U.K.,
    German, French and Japanese sites, grew 68% to $379 million
    in the first quarter, unit growth was 52%, and excluding the
    benefit from foreign exchange rates compared with the first
    quarter 2002, International segment sales grew 45%.
    International segment operating income was $16 million, a $27
    million improvement.

-- The Company's U.K. and German sites expanded selection by
    opening Kitchen & Home stores.

-- Inventory turns for the trailing four quarters improved to 20
    for the first quarter, up from 17.

-- The Company has been taking pre-orders worldwide for copies
    of the highly-anticipated Harry Potter and the Order of the
    Phoenix. And, in what will be the largest single e-commerce
    distribution event in history, customers in the U.S. and
    Canada can receive their copy on Saturday, June 21, the first
    day the book is available to the public.

           Financial Guidance and 2003 Expectations

The following forward-looking statements reflect Amazon.com's
expectations as of April 24, 2003. Results may be materially
affected by many factors, such as changes in global economic
conditions and consumer spending, world events, fluctuations in
foreign exchange rates, the emerging nature and rate of growth
of the Internet and online commerce, and the various factors
detailed below.

Second Quarter 2003 Guidance

-- Second quarter net sales are expected to be between $1.00
    billion and $1.05 billion, or grow between 24% and 30%.

-- Consolidated segment operating income is expected to be
    between $45 million and $60 million.

Full Year 2003 Expectations

-- Net sales are expected to be $4.7 billion or more, or grow
    over 19%.

-- Consolidated segment operating income is expected to be $275
    million or more, or grow over 50%.

The Company is unable to forecast the effect on its future
reported results of certain items, including the stock-based
compensation charges or credits associated with variable
accounting treatment on certain stock awards that result from
fluctuations in its stock price, and the gain or loss associated
with the remeasurement of its 6.875% PEACS that results from
fluctuations in foreign exchange rates. Accordingly, because
stock-based compensation and remeasurement of 6.875% PEACS and
other are impossible to predict, the Company cannot estimate
future operating income (loss) or net income (loss).

Amazon.com, a Fortune 500 company based in Seattle, opened on
the World Wide Web in July 1995 and today offers Earth's Biggest
Selection. Amazon.com seeks to be Earth's most customer-centric
company, where customers can find and discover anything they
might want to buy online, and endeavors to offer its customers
the lowest possible prices. Amazon.com and other sellers list
millions of unique new and used items in categories such as
apparel and accessories, electronics, computers, kitchenware and
housewares, books, music, DVDs, videos, cameras and photo items,
toys, baby items and baby registry, software, computer and video
games, cell phones and service, tools and hardware, magazine
subscriptions and outdoor living items.

Amazon.com operates six Web sites: http://www.amazon.com
http://www.amazon.co.uk http://www.amazon.de
http://www.amazon.fr http://www.amazon.co.jpand
http://www.amazon.ca

Amazon.com Inc.'s 10% bonds due 2008 (AMZN08USR1) are trading at
about 91 cents-on-the-dollar, DebtTraders reports. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=AMZN08USR1
for real-time bond pricing.


AMERICAN AIRLINES: Donald J. Carty Steps Down as CEO & Chairman
---------------------------------------------------------------
The AMR (NYSE: AMR) Board of Directors accepted the resignation
of CEO and Chairman Don Carty. The Board named Edward A. Brennan
as Executive Chairman and current President and COO Gerard J.
Arpey as the new Chief Executive Officer. Arpey continues as
President.

Ed Brennan, on behalf of the AMR Board of Directors, thanked Don
Carty for his years of service and dedication to the company.
They were especially grateful for his stewardship during the
most difficult years in aviation history.

Carty praised his successors and said the appointments of
Brennan and Arpey will "begin to build a bridge back to the path
that promised a new culture of collaboration, cooperation and
trust."

In a statement, the Board of Directors said, "In making these
appointments, we have great confidence in the team of Ed Brennan
and Gerard Arpey."

Ed Brennan, who has served as a member of the AMR Board of
Directors for more than 17 years, has the "breadth of experience
leading and directing some of the most venerable companies in
America and will serve American incredibly well," the Board
stated.

In appointing Gerard Arpey, the Board noted that, "His
commitment to this company is unwavering. His dedication to its
employees is unsurpassed. And his experience and business acumen
in this industry is unrivaled."

Arpey promised to work to rebuild trust in management throughout
the company and said he looks forward to the value Brennan's
counsel will bring to the company.

First joining American in 1982 as a financial analyst, Arpey
served as chief financial officer of AMR from 1995 to 2000,
during which time the Company experienced strong profitability.
He also led the successful efforts to spin off Sabre from AMR.

And since becoming Chief Operating Officer in 2000, he has
guided the Company's operations out of the depths of the
September 11th tragedy to the forefront of industry on-time
performance and reliability.

"I will continue to lead by example," Arpey said. "Actions, of
course, speak louder than words. And you can expect me to ensure
my actions are consistent with the high standards we set for all
employees of American Airlines and American Eagle."

Arpey vowed to do his very best to lead American "through these
extraordinary times" and "restore the confidence of all
employees in their great company."

Carty, 58, has spent more than 20 years at AMR, where he has
served as CEO and Chairman since 1998.

Brennan, 69, is the retired chairman, president and CEO of
Sears, Roebuck and Co. Prior to his retirement from Sears in
1995, he had been associated with that company for 39 years.

Arpey, 44, has devoted his entire professional career to
American Airlines, where he began as a financial analyst in 1982
and became a corporate officer in 1989. He holds a FAA multi-
engine instrument rating and is an avid private pilot.

                     STATEMENT BY DONALD J. CARTY
                           April 24, 2003

Over the course of the past two years, the management team,
union leaders and American Airlines' employees have knocked down
barrier after barrier in the way of this company's success.

I am confident that the hard work everyone is doing will send a
strong signal that the company is intent on re-establishing
productive relations with its unions and its employees -- a key
ingredient, by any measure, to any company's success.

It is now clear that my continuing on as Chairman and CEO of
American Airlines is still a barrier that, if removed, could
give improved relations -- and thus long-term success -- the
best possible chance.

So today, to remove that barrier and to help make possible the
success American's employees so richly deserve, the AMR board of
directors has accepted my offer to step down as Chairman and CEO
of American Airlines.

I am very pleased that Edward A. Brennan, a member of the AMR
board of directors for well over a decade, will serve as the
executive chairman of American Airlines.

I am also delighted that the board has appointed Gerard Arpey as
chief executive officer of American Airlines.

Gerard has been a tremendous friend and partner over the years.

His commitment to this company is unwavering. His dedication to
its employees is unsurpassed. And his experience and business
acumen in this industry is unrivaled.

So today, it is my most fervent hope that my resignation and the
appointment of Ed and Gerard will enable the company, its unions
and its employees to begin to build a bridge back to the path
that promised a new culture of collaboration, cooperation and
trust.

This is a great airline with the best employees in the business.
I want to thank them for the extraordinary things they do for
every customer, every day.

It is because of them that American enjoys the best customer
preference record in the business. I have been very proud to
serve them.

I want to thank my management team, which has led the very
challenging, and equally innovative restructuring effort. They
have given up much to shepherd this company through a very
difficult time. I admire their commitment and professionalism.

It has been an honor to work with each and every one of them.

I also want to thank the AMR board of directors. AMR enjoys,
without a doubt, one of the finest boards in America -- a board
that consistently sets standards for the highest ethical
practices in corporate America. I appreciate that they entrusted
me to lead American through one of the most difficult periods in
aviation history.

I am grateful for their guidance and support during my tenure at
the company's helm. They have been invaluable to me, as I know
they will be to Gerard.

And to Ed and Gerard I say, you are privileged to now be leading
the best airline in the industry -- an airline with the right
plan and the right people to succeed today, tomorrow and well
into the 21st century.

You have a tremendous legacy on which to build - a legacy of
strength, pride, service, heroism, resiliency, innovation, and
commitment. I know you will be as proud to serve the men and
women of this great company as I have.

I will always cherish my time at American. I have loved this
airline and its people for the more than twenty years I have had
the enormous privilege to serve them.

I am confident that American will continue to set new standards
of excellence and soar to new heights.

I look forward to cheering them on.

                EXCEPT FROM GERARD ARPEY'S REMARKS
             TO THE AMR BOARD OF DIRECTORS IN ACCEPTING
             HIS APPOINTMENT AS CHIEF EXECUTIVE OFFICER

"In my 21 years with this great company, I believe I have earned
the respect and trust of all those I have worked with, from
employees, to stockholders, to suppliers, to those in the
community in which I live.

"As I step into this broader leadership role, I want employees
to know that I will continue to lead by example. Actions, of
course, speak louder than words. And you can expect me to ensure
my actions are consistent with the high standards we set for all
employees of American Airlines and American Eagle."

                            *   *   *

American Airlines Inc.'s 11.110% ETCs due 2005 (AMR05USR30) are
trading between 20 and 30 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=AMR05USR30
for real-time bond pricing.


AMERICREDIT: Fitch Ratchets Senior Unsecured Debt Rating to B
-------------------------------------------------------------
Fitch Ratings lowers AmeriCredit Corp.'s senior unsecured rating
to 'B' from 'B+'. The Rating Outlook remains Negative.
Approximately $375 million of senior unsecured debt is affected
by this rating action. Fitch's rating action reflects heightened
concern regarding the trend in net charge-offs and continued
macro economic pressures on asset quality and used car prices.
Unabated, these factors will continue to erode the remaining
cushion in charge-off related covenants in the company's
warehouse facilities. AmeriCredit's warehouse covenants require
the annualized managed net charge-off ratio to be below an
average of 8.0% for two consecutive quarters. Annualized managed
net charge-offs to average managed receivables have risen in
consecutive quarters from 3.6% for the second quarter ended Dec.
31, 2000 to 7.6% for the most recent quarter ended March 31,
2003, albeit some of the increase is attributed to management's
more proactive handling of delinquent accounts which has
contributed to the rise.

The negative outlook reflects continued liquidity constraints
due to weakened asset quality measures of securitizations and
increased enhancement requirements for new transactions. As
expected, some securitization transactions executed in the 2000
time frame began to hit cumulative loss triggers during March
2003, trapping excess cash in those trusts. Fitch remains
concerned that additional and more recent pools may also hit
cumulative net loss triggers as well. In Fitch's view, access to
the term asset-backed securitization market is potentially more
difficult and costly to obtain. The company's most recent
transaction required higher credit enhancement over previous
deals reflecting the weaker underlying performance of the
collateral pool. Furthermore, AmeriCredit continues to rely on
monoline bond insurers to execute its secured financings,
however, the company has recently executed a whole loan
transaction, highlighting an alternative financing option.

In addition, AmeriCredit announced high level organizational
change, with the company's CEO and COO stepping down from the
company. Fitch believes that these organizational changes raise
additional transitional challenges for existing senior
management.


AVAYA INC: March 31 Balance Sheet Upside-Down by $25 Million
------------------------------------------------------------
Avaya Inc., a leading global provider of communications networks
and services for businesses, reported second fiscal quarter
results in accordance with generally accepted accounting
principles. Avaya's revenues rose to $1.081 billion in the
second fiscal quarter of 2003, an increase of 1.3 percent
sequentially from revenues of $1.067 billion in the first fiscal
quarter of 2003. Revenues in the year ago quarter were $1.279
billion.

The company had a net loss of $16 million or a loss of four
cents per diluted share in the second fiscal quarter of 2003,
compared to a net loss of $121 million in the first fiscal
quarter of 2003. In the same period last year the company had a
net loss of $63 million.

Avaya said operating income in the second fiscal quarter of 2003
was $28 million compared to an operating loss of $18 million in
the first fiscal quarter of 2003. In the second fiscal quarter
of 2002, Avaya had an operating loss of $108 million.

                      Cash And Gross Margin

The company's cash balance increased in the second fiscal
quarter of 2003 to $724 million and cash flow from operations
for the quarter was $85 million. Gross margin in the second
fiscal quarter was 42.2 percent, up from 39.7 percent in the
first fiscal quarter.

                          CEO Comments

"We made great strides this quarter to strengthen our financial
position and size our business to take advantage of marketplace
opportunities," said Don Peterson, chairman and CEO, Avaya. "We
had higher gross margins and positive operating income. Our cash
balance increased for the third quarter in a row and we saw some
stability in revenues as customers invested in Avaya solutions
that deliver immediate benefits." Peterson added. "We remain
cautious in our expectations given the uncertain economic
conditions and we'll continue to manage resources closely to
drive additional efficiencies."

                     Year-To-Date Results

Revenues for the first six months of fiscal 2003 were $2.148
billion compared to revenues of $2.585 billion for the first six
months of fiscal 2002.

The company had a net loss of $137 million or a loss of 37 cents
per diluted share for the first six months of fiscal 2003,
compared to a net loss of $83 million or a loss of 74 cents per
diluted share for the first six months of fiscal 2002.

Operating income for the first six months of fiscal 2003 was $10
million compared to an operating loss of $135 million for the
first six months of fiscal 2002.

                     Highlights in the Quarter

Among the announcements Avaya made in the second quarter are:

Avaya Enterprise Connect, a set of solutions and services that
allow businesses to extend the advanced features and complete
functionality of Avaya MultiVantage(TM) Communications
Applications -- including Internet

Protocol (IP) telephony, contact center, unified communication
and messaging -- from a central location to any size office or
home in a distributed enterprise over a secure, high-performance
converged network.

Single Point of Accountability services offers and tools from
Avaya Global Services that help enterprises to evolve their
multi-vendor voice and data networks into secure and reliable
Internet-protocol telephony converged networks. Offers and tools
include: a customer readiness survey tool, ExpertNet SM VoIP
assessment tools and network continuity assessment for planning
and design; enterprise project management for implementation;
complete remote management of converged networks and a Software
Protection Plan for MultiVantage(TM) software.

Avaya Modular Messaging, which enables workers to easily access
and manage voice and fax messages in Internet Protocol (IP) and
traditional telecom network environments.

Avaya is building a large call center for the Unicom Guomai
Communications Co., Ltd. in China. Once completed, the call
center will be leased to enterprises and serve as their virtual
customer service center.

           Second Quarter And Year-To-Date Results
                On An Ongoing (Non-GAAP) Basis

The company had a net loss on an ongoing basis of five million
dollars in the second fiscal quarter of 2003, compared to a net
loss on an ongoing basis of $34 million in the first fiscal
quarter of 2003. In the second fiscal quarter of 2002 the loss
was $10 million.

For the first six months of fiscal 2003, Avaya had a net loss of
$39 million on an ongoing basis, compared to a net loss of $26
million on an ongoing basis for the same period last year.

Operating income on an ongoing basis in the second fiscal
quarter of 2003 was $14 million compared to an operating loss of
$14 million in the first fiscal quarter. In the second fiscal
quarter of 2002, Avaya had an operating loss on an ongoing basis
of $20 million.

For the first six months of fiscal 2003, operating income on an
ongoing basis was at breakeven compared to an operating loss of
$41 million on an ongoing basis in the first six months of
fiscal 2002.

Avaya noted the second fiscal quarter of 2003 ongoing results
exclude the following:

* $17 million of income recognized for the reversal of business
   restructuring liabilities established in prior periods,
   partially offset by three million dollars of expenses
   associated with the fourth quarter fiscal 2002 business
   restructuring initiative; and

* a $36 million pre-tax loss ($26 million after-tax) related to
   the exchange of Liquid Yield Option(TM) (LYONs) Notes in
   January, partially offset by a one million dollar gain
   recognized from the buyback of LYONs in March.

At March 31, 2003, the Company's balance sheet shows a total
shareholders' equity deficit of about $25 million.

                          Other Matters

Avaya noted the second quarter results announced do not include
a charge for its portion of the liability related to class
action lawsuits Lucent Technologies settled in the quarter.
Avaya will contribute to the pending settlement as part of its
separation agreement with Lucent.

To the extent that Avaya has a sufficient understanding of the
details of the settlement prior to the filing of its second
quarter Form 10-Q, it will record a charge related to the
settlement in the second quarter financial statements included
in Form 10-Q.

Avaya Inc., designs, builds and manages communications networks
for more than 1 million businesses worldwide, including 90
percent of the FORTUNE 500(R). Focused on businesses large to
small, Avaya is a world leader in secure and reliable Internet
Protocol (IP) telephony systems and communications software
applications and services.

Driving the convergence of voice and data communications with
business applications -- and distinguished by comprehensive
worldwide services -- Avaya helps customers leverage existing
and new networks to achieve superior business results. For more
information visit the Avaya Web site: http://www.avaya.com

DebtTraders reports that Avaya Inc.'s 11.125% bonds due 2009
(AV09USR1) are trading slightly above par at 103. Go to
http://www.debttraders.com/price.cfm?dt_sec_ticker=AV09USR1for
real-time bond pricing.


BIOTRANSPLANT INC: Provides Update on MEDI-507 Clinical Status
--------------------------------------------------------------
BioTransplant Incorporated (OTC Bulletin Board: BTRNQ.OB)
announced that MedImmune Inc., the Company's partner in the
development of MEDI-507, has provided an update on its
development program for psoriasis.

In a conference call for investors, MedImmune announced plans to
postpone the initiation of further clinical studies with MEDI-
507 in psoriasis pending the completion of a Phase II trial of
Vitaxin(TM), MedImmune's investigational monoclonal antibody, in
psoriasis. MedImmune indicated that its plans to evaluate MEDI-
507 for T-cell lymphoma have not changed, and that it intends to
initiate a trial for that indication.

"We are obviously disappointed with this development," stated
Donald Hawthorne, President and Chief Executive Officer of
BioTransplant. "We are actively addressing the potential impact
of this news and considering various strategic options. We
intend to provide an update on our strategy once finalized."

BioTransplant Incorporated, a Delaware corporation located in
Medford, Massachusetts, is a life science company whose primary
assets are intellectual property rights that it has exclusively
licensed or seeks to exclusively license to third parties. On
February 27, 2003, the Company and Eligix, Inc., its wholly-
owned subsidiary, filed voluntary petitions for relief under
Chapter 11 of the Bankruptcy Code in the United States
Bankruptcy Court in Boston Massachusetts. The Company's strategy
is to maximize the potential future value of its licensed
intellectual property rights. The Company has exclusively
licensed Siplizumab (MEDI-507), a monoclonal antibody product,
to MedImmune, Inc. The Company's assets also include the
AlloMune System technologies, which are intended to treat a
variety of hematologic malignancies and improve outcomes for
solid organ transplants, and the Eligix HDM Cell Separation
Systems, which use monoclonal antibodies to remove unwanted
cells from bone marrow, peripheral blood stem cell and donor
leukocyte grafts used in transplant procedures. BioTransplant
also has an interest in Immerge BioTherapeutics, Inc., a joint
venture with Novartis, to further develop both companies'
individual technology bases in xenotransplantation.


BROADWING: S&P Affirms B- Corp. Credit Rating & Removes Watch
-------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B-' corporate
credit rating on Cincinnati, Ohio-based incumbent local exchange
carrier Broadwing Inc. All ratings were removed from
CreditWatch, where they were placed Aug. 29, 2002, due to
concerns over Broadwing's potential inability to meet its
significant bank debt amortization, as well as concerns over
tight bank covenants.

The outlook is negative. Broadwing had total debt of about $2.5
billion at the end of 2002.

"The affirmation follows Broadwing's recent resolution of near-
term liquidity concerns after it amended its bank credit
agreement to include a new amortization schedule and revised
financial maintenance covenants," said Standard & Poor's credit
analyst Michael Tsao. The new amortization schedule effectively
defers a major portion of the sizable amortization originally
scheduled from 2004 to 2006 while moderately increasing
amortizations for 2003 and 2005. The amended financial covenants
are based on the cash flows of Broadwing's stable Cincinnati-
based businesses (ILEC and the wireless business) and exclude
the operating results of Broadwing Communications Inc. (BCI),
the company's troubled long-haul data subsidiary.

Apart from this favorable development, the company also entered
into an agreement to sell BCI for up to $129 million in cash and
the assumption of certain operating liabilities by the
prospective buyer.

The rating reflects Broadwing's high debt load and very limited
longer term liquidity. The company used significant debt to move
into the long-haul data business based on optimistic
expectations of capacity demand that later did not materialize.
Although it has entered into an agreement to sell BCI, virtually
all the debt associated with that business will remain with
Broadwing after the closing of the transaction, which could
occur in the second half of 2003. As a result, Broadwing will
likely still have about $2.4 billion of debt at the end of 2003.

Broadwing is an integrated telecommunications services provider
that provides local, long distance, wireless, and broadband
services in the greater Cincinnati metropolitan area. Through
its incumbent Cincinnati Bell Telephone Co. subsidiary, the
company serves more than one million access lines.


BROADWING: Commences Exchange Offer & Consent Solicitation
----------------------------------------------------------
Broadwing Inc. is implementing a five-point restructuring plan,
intended to strengthen its financial position, maintain the
strength and stability of its local telephone business, reduce
the cash expenditures at its Broadwing Communications Inc.
subsidiary, facilitate the evaluation of strategic alternatives
and reduce its debt balances over time. To date, Broadwing has
secured additional sources of capital, amended its credit
facilities and entered into an agreement to sell its broadband
business by selling substantially all of the assets of certain
of BCI's operating subsidiaries.

Also as part of the Restructuring Plan, the Company is offering
to exchange 14,148,518 shares of its common stock for all of the
outstanding shares of 12-1/2% Series B Junior Exchangeable
Preferred Stock of BCI upon the terms and subject to the
conditions specified in a prospectus and solicitation statement
and the related consent and letter of transmittal prepared by
the Company.

Concurrently with the exchange offer, Broadwing is also
soliciting consents from holders of BCI Preferred Stock to amend
the certificate of designation under which the shares were
issued to eliminate all voting rights and restrictive covenants.
The exchange offer and consent solicitation will expire on a
date yet to be determined, at 5:00 p.m., New York City time,
unless extended.

The exchange offer and consent solicitation are conditioned
upon, among other conditions, the receipt of valid tenders and
consents from holders of not less than 66-2/3% of the
outstanding BCI Preferred Stock. Holders of shares representing
approximately 67.4% of BCI Preferred Stock have already agreed
with the Company to tender their shares and give their consents.
As a result, the minimum tender condition will be satisfied upon
the tender of the shares held by these holders.

If the exchange offer and consent solicitation are completed, in
connection therewith Broadwing will effect a merger of a newly-
formed wholly owned subsidiary of Broadwing with and into BCI,
in which any remaining shares of BCI Preferred Stock not
tendered by shareholders will be converted into the same number
of shares of Broadwing common stock that such would have
received if the shares were tendered in the exchange offer.
Broadwing has indicated that if the exchange offer and consent
solicitation are not completed, Broadwing will evaluate its
other strategic alternatives regarding BCI, which may include
the filing by BCI for protection under Chapter 11 of the U.S.
Bankruptcy Code, in which the shares of BCI Preferred Stock
would likely be extinguished for no consideration.

Shares of BCI Preferred Stock are listed on the New York Stock
Exchange under the symbol "IXK-NA-09," and the last reported
trading price on April 14, 2003 was $129.38. Shares of Broadwing
common stock are listed on the NYSE under the symbol "BRW," and
the last reported trading price on April 14, 2003 was $3.93.


CALPINE: Cuts Off Client-Auditor Relationship with Deloitte
-----------------------------------------------------------
On April 10, 2003, Deloitte & Touche LLP and Calpine Corporation
ceased their client auditor relationship.  On that date, the
following events occurred:

      (1)  Deloitte notified the Chairman of the Audit Committee
           that Deloitte resigned its audit relationship with the
           Company.

      (2)  The Company's Audit Committee and its Board of
           Directors determined to no longer utilize the audit
           services of Deloitte and approved the appointment of
           PricewaterhouseCoopers LLC to serve as the Company's
           independent public accountants for the fiscal year
           ended December 31, 2003.

Deloitte has not included, in any report on the Company's
financial statements, an adverse opinion or a disclaimer of
opinion, or a qualification or modification as to uncertainty,
audit scope, or accounting  principles with respect to the
Company's financial statements.

Calpine had a disagreement with Deloitte, which, according to
Calpine, was satisfactorily resolved, related to the
interpretation  of certain provisions of power sales agreements
associated with two power plants  for which the Company had
utilized sale-leaseback transactions.  The Company had
previously accounted for these sale-leaseback transactions as
qualifying for operating lease accounting treatment.  Deloitte
concluded that the provisions of the power sales agreements
precluded operating lease accounting treatment.  The Audit
Committee of the Company's Board of Directors discussed the
subject matter of the disagreement with Deloitte.  The Company
recorded adjustments related to these matters in the 2000 and
2001 consolidated  financial statements and adjusted the
previously announced unaudited financial statements for 2002.

The Company has authorized Deloitte to respond fully to the
inquiries of PricewaterhouseCoopers concerning the subject
matter of the foregoing disagreement. The Company provided
PricewaterhouseCoopers with a copy of the foregoing disclosures.

                         *   *   *

As reported in Troubled Company Reporter's December 11, 2002
edition, Calpine Corp.'s senior unsecured debt rating was
downgraded to 'B+' from 'BB' by Fitch Ratings. In addition,
CPN's outstanding convertible trust preferred securities and
High TIDES were lowered to 'B-' from 'B'. The Rating Outlook was
Stable. Approximately $9.3 billion of securities were affected.

DebtTraders reports that Calpine Corporation's 10.500% bonds due
2006 (CPN06USR2) trade between 77 and 79 cents-on-the-dollar.
See http://www.debttraders.com/price.cfm?dt_sec_ticker=CPN06USR2
for real-time bond pricing.


CNH GLOBAL: First Quarter 2003 Results Meet Expectations
--------------------------------------------------------
CNH Global N.V. (NYSE: CNH) reported first quarter 2003 results
consistent with expectations, better than the first quarter of
2002, and achieved in a much more difficult industry
environment. Tight control of costs were key to achieving CNH's
target in the face of lower sales of the company's higher-
margin construction equipment products.

For the first quarter CNH reported a net loss of $46 million,
which includes net restructuring charges of $6 million. This
compares to a first quarter 2002 net loss of $49 million
including $3 million in restructuring charges and before the
cumulative effect of a change in accounting principle. The net
loss per share was $.35 for the first quarter of 2003, including
net restructuring charges of $.05 per share. Per share results
have been retroactively restated to reflect the reverse stock
split effected on April 1, 2003.

CNH reported first quarter consolidated revenues of $2.397
billion, compared to $2.389 billion in the same period last
year. Adjusted for the favorable impact of foreign exchange
rates, revenues declined by 5% due mainly to a decline in
construction equipment sales.

"Again this quarter we have delivered a bottom line result
consistent with expectations in spite of weaker than expected
industry sales," Paolo Monferino, CNH president and chief
executive officer, said. "Moreover, we have maintained our
Equipment Operations net debt at virtually the same level as of
December 31, 2002 even as we have built inventory in
anticipation of the spring selling season."

At the beginning of the second quarter, CNH closed a $2 billion
debt-for- equity exchange with majority shareholder Fiat. On a
March 31, 2003 pro forma basis, the company's Equipment
Operations debt-to-capitalization ratio was reduced to 26% by
this transaction.

"With the substantial support of the Fiat Group, supplemented by
an infusion of new capital last year and our diligent management
of working capital, we have cut our Equipment Operations net
debt by approximately $4 billion in just over 12 months time,"
CEO Paolo Monferino stated. "Our strong balance sheet frees us
to grow this business and justifies the faith our customers,
dealers and suppliers have placed in us."

First quarter sales of agricultural equipment. Revenues from
sales of agricultural equipment increased to $1.600 billion for
the quarter, compared to $1.552 billion in the first quarter of
2002. Net of favorable currency, revenues declined by 3%.

First quarter 2003 industry unit sales of under-40 horsepower
tractors increased in North America, while sales of over-40
horsepower tractors, combines, and hay and forage equipment
declined. In Europe, industry sales were essentially unchanged
while Latin American sales declined from 2002 levels.
Agricultural equipment industry sales in the developing markets
of the world improved moderately compared to 2002.

Retail sales of CNH agricultural equipment in the first quarter
were up slightly more than the industry overall, as share gains
in Europe and in over- 40 horsepower tractors in North America
offset slight declines elsewhere.

First quarter sales of construction equipment. Revenues from the
sale of construction equipment were $677 million compared to
$687 million in the first quarter of 2002. Net of currency,
revenues declined by 9% in the quarter.

In the Americas, industry unit sales of heavy equipment were
weaker than expected, compared to the same period last year,
while in Europe the industry was essentially flat. Worldwide
industry unit sales of light equipment were also much lower than
expected in the quarter, as moderate declines in North America
and Europe more than offset gains in Latin America and Asia.

Unit sales of CNH heavy equipment declined moderately in the
Americas and Europe but increased in Asia. Sales of CNH light
equipment declined more than the industry in the Americas and
Europe.

Equipment Operations first quarter financial results. First
quarter net sales of equipment were $2.277 billion, compared to
$2.239 billion for the same period in 2002. Adjusted for the
impact of favorable currency, net sales declined by 4%.

CNH's Equipment Operations gross margin percentage for the
quarter declined slightly compared to the same period last year.
Pricing, improved margins from new agricultural products, and
favorable exchange rates were more than offset by adverse volume
and mix changes, higher medical and pension costs, and launch
costs for new products.

SG&A expenses were significantly impacted by exchange rates,
offset by the company's cost reduction actions primarily in its
construction equipment business.

In total, medical and pension costs for active employees and
retirees increased by approximately $24 million in the quarter,
offset by the company's profit improvement initiatives.

The drop in net interest expenses for the quarter was due mainly
to the company's successful debt reduction actions completed in
June 2002.

Financial Services first quarter financial results. In the first
quarter of 2003, CNH Capital reported net income of $6 million,
including $2 million of restructuring costs net of tax, compared
to $9 million in the same period last year when CNH Capital
benefited from a large ABS transaction. The company's first
significant ABS transaction in 2003 is planned for the second
quarter.

The total serviced portfolio at the end of the quarter increased
by 4% compared to year end 2002 levels and by 2% compared to the
end of the first quarter of 2002. The first quarter of 2003
marked the fourth consecutive quarter in which past due and
delinquency rates in CNH Capital's core business have declined.

Balance Sheet. During the first quarter of 2003, CNH's Equipment
Operations recorded a seasonal increase of $135 million in debt
net of cash, cash equivalents and inter-segment notes
receivables. This compares to an increase of $383 million in the
first quarter of 2002, reflecting improved working capital
management.

During the first quarter of 2003, CNH's Financial Services net
debt rose by $605 million to $4.170 billion, reflecting the
normal build-up of retail receivables in anticipation of ABS
transactions expected in the second quarter of 2003.

On a pro forma basis, considering the $2 billion debt-for-equity
exchange closed on April 7 and 8, 2003, Equipment Operations
debt net of cash, cash equivalents and inter-segment notes was
$1.659 billion at the end of the first quarter. This is equal to
26% of total net capitalization and approximately $4 billion
lower than on March 31, 2002.

Industry Outlook. The high degree of political and economic
uncertainty in most major markets introduces a significant level
of uncertainty into any forecast of industry or company
performance in 2003.

In both North and Latin America, CNH expects 2003 industry sales
of agricultural tractors and combines to fall slightly below
2002 levels. In Europe, the industry is expected to remain at or
near 2002 levels through the balance of 2003. Tractor sales in
the developing markets should be flat.

CNH expects industry sales of heavy construction equipment to
remain below 2002 levels in the Americas and Western Europe.
Industry sales of light equipment in North America and Europe
are expected to show larger declines from 2002 levels, with
backhoe loader sales showing the greatest drop. Industry sales
of light equipment in Latin America and Asia may be up slightly.

CNH Outlook for the Second Quarter. For the second quarter of
2003, CNH expects to report a net result slightly improved from
the same period last year, excluding restructuring charges. The
product renewal process in the agricultural equipment business
is on track, and CNH expects to compensate for any industry
decline through the increased share being won by the new
products.

However, weaker than anticipated first quarter performance on
the construction equipment side of the business has necessitated
substantial cuts in second quarter production and wholesale
levels in order to keep inventories in line. Accelerated profit
improvement actions and aggressive cost control in virtually all
aspects of the enterprise should offset the bottom line impact.

Employee medical and pension costs will increase again in the
second quarter and, should the Euro remain strong, the company's
SG&A and R&D costs will be adversely impacted. Lower interest
expenses in the second quarter are expected to offset both
factors.

CNH Outlook for 2003. For the full year, CNH expects its
agricultural equipment business to contribute to improved
operating results as the introduction of new, higher margin
products gains momentum. Share gains and higher margins from new
products should more than offset the adverse currency impact on
costs.

Based on the first quarter results, CNH is aggressively managing
its construction equipment business, moving rapidly to cut costs
now and restructure the business for sustained profitability.
For 2003, CNH expects that the actions now underway should
enable the construction equipment business to reduce its
operating loss by 50% compared to the prior year.

Employee medical and pension costs are expected to increase by
about $90 million in 2003. These increased costs should be
offset by profit improvement initiatives of approximately $100
million in total for the year, with significant manufacturing
efficiencies and overhead reductions to be realized in the
second half of 2003.

Interest expense savings realized through the company's
successful debt reduction action at the start of the second
quarter will be partially offset by the adverse currency impact
on Euro denominated loans, and higher interest costs on some
remaining credit lines, resulting in pre-tax savings of
approximately $100 million in 2003.

For the full year, CNH expects to record a bottom line
improvement of about $100 million, bringing CNH into the black,
before restructuring charges, for 2003.

During 2003, CNH will incur approximately $60 million in pre-tax
restructuring costs associated with the rationalization of its
construction equipment business. Most of the costs will be
incurred in Europe where the obligatory process of consultation
and discussion with affected parties is now underway. Some
portion of these costs may be incurred in the second quarter.

Beginning in late 2003 and possibly extending into 2004, CNH
will incur pre-tax restructuring charges of approximately $190
million associated with the closure of its East Moline facility
which was announced in July 2000.

Including all other actions planned or underway, and assuming
all East Moline charges occur in 2003, restructuring costs for
the year are expected to total about $325 million, pre-tax, with
a maximum cash impact of approximately $75 million.

CNH is the number one manufacturer of agricultural tractors and
combines in the world, the third largest maker of construction
equipment, and has one of the industry's largest equipment
finance operations. Revenues in 2002 totaled $10 billion. Based
in the United States, CNH's network of dealers and distributors
operates in over 160 countries. CNH agricultural products are
sold under the Case IH, New Holland and Steyr brands. CNH
construction equipment is sold under the Case, FiatAllis, Fiat
Kobelco, Kobelco, New Holland, and O&K brands.

                          *    *    *

As reported in Troubled Company Reporter's March 31, 2003
edition, CNH Global N.V. (BB/Stable/-) announced that the
company's shareholders had approved plans to reduce the
company's net debt by $2 billion through the issuance of
convertible perpetual preferred securities to a financial
affiliate of CNH's majority shareholder, Fiat S.p.A.
(BB+/Negative/B).

The company expects to use the proceeds of the transaction to
repay Equipment Operations indebtedness owed to Fiat Group
companies. On a December 31, 2002 pro forma basis, Equipment
Operations net debt will drop to a level of about $1.5 billion,
and the company's net debt-to-capitalization ratio will drop
from 56% to 24%.


CONSECO FINANCE: Court Fixes May 22 Prepetition Claims Bar Date
---------------------------------------------------------------
The Conseco Finance Corp. Debtors sought and obtained Judge
Doyle's consent to establish prepetition claims bar dates and
approve the proposed form and manner of notice of the bar dates.
These claim-filing deadlines will apply in Conseco Finance's
cases:

   May 22, 2003        CFC Prepetition Claims Bar Date
   June 17, 2003       CFC Initial Debtors Government Bar Date
   August 4, 2003      CFC Subsidiary Debtors Government Bar Date

Each entity asserting a claim must file an original, written
proof of claim that conforms to Proof of Claim Official Form No.
10.  The proof of claim must be received by Bankruptcy
Management Corporation by the applicable bar date.  The forms
must be sent to these addresses:

       If by courier/hand delivery:

       Attn: Conseco Finance Corp. Debtors Claims Agent
       Bankruptcy Management Corp.
       1330 E. Franklin Avenue
       El Segundo, CA   90245

       If by mail:

       Attn: Conseco Finance Corp. Debtors Claims Agent
       Bankruptcy Management Corp.
       P.O. Box 1042
       El Segundo, CA   90245-1042

(Conseco Bankruptcy News, Issue No. 18; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


CONSECO INC: TOPrS Committee Seeks Nod to Depose 12 Executives
--------------------------------------------------------------
The discovery dispute between the Official Committee of Trust
Originated Preferred Debt Holders and the Conseco Inc. Debtors
focuses on whether the TOPrS Committee should be limited to ten
depositions only and whether the Debtors should be compelled to
identify their Rule 30(b)(6) deponents in advance.  On March 28,
2003, the TOPrS Committee served a Rule 30(b)(6) Notice of
Deposition on the Debtors.  The TOPrS Committee later notified
the Debtors' counsel that it wished to depose these witnesses:

     1) Stephen C. Hilbert -- Former Management

     2) Rolin M. Dick -- Former Management

     3) Gary Wendt -- Chairman of the Board

     4) William Shea -- President, COO and CFO

     5) Dan Murphy -- VP Finance and Treasurer

     6) Ron Ruhl -- Executive VP and Chief Actuary

     7) Eric Johnson -- VP

     8) Elizabeth Georgakopoulos -- Former President Conseco
        Group

     9) David Harkins -- Board Member

    10) John M. Mutz -- Board Member

    11) Ernst & Young -- responsible for preparing Goodwill
        Impairment Analysis

    12) Gene Bullis -- CFO

The Debtors have indicated that they will not agree to more than
ten depositions.  The Debtors also indicated they will not
disclose the identity of their Rule 30(b)(6) witness.

Catherine Steege, Esq., at Jenner & Block, tells Judge Doyle
that the benefit to the TOPrS Committee from additional
depositions greatly outweighs any burden on the Debtors.  The
TOPrS Committee cannot otherwise obtain in discovery the
information sought from these individuals.  The information
sought is not cumulative or duplicative and is not available
from a more convenient, less burdensome source.  The
individuals' testimony will be crucial to understanding the
valuation documents and other analyses produced by the Debtors.

The TOPrS Committee asks Judge Doyle for permission to exceed
the ten-deposition limit imposed by Rule 30(a)(2)(A).
Additionally, the TOPrS Committee wants the Debtors to designate
the identity of their Rule 30(b)(6) witnesses prior to the
scheduled deposition. (Conseco Bankruptcy News, Issue No. 18;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


CONSUMERS ENERGY: Fitch Rates $625-Mil Issuances of FMBs at BB+
---------------------------------------------------------------
Fitch Ratings has assigned ratings of 'BB+' to Consumers Energy
Co.'s $250 million issuance of 4.25% first mortgage bonds, due
April 15, 2008, and $375 million issuance of 5.375% FMBs, due
April 15, 2013. The bonds are being issued to qualified
institutional buyers under Rule 144A of the Securities Act.
Proceeds from the issuance will be used to repay debt and for
general corporate purposes. On April 23, 2003, Fitch affirmed
the outstanding debt ratings of Consumers and removed them from
Rating Watch Negative following a review of the company's
financial and operating performance and business plans. The
Rating Outlook is Stable.

Consumers' ratings and Stable Outlook recognize the solid
standalone credit characteristics of the regulated utility.
Ratings at Consumers are also subject to constraint resulting
from ownership linkage of CMS Energy (senior secured rated 'BB-
', Rating Outlook Negative). Although headroom exists within
Consumers' current ratings for further moderate deterioration at
CMS, which was also removed from Rating Watch Negative on April
23, 2003, and assigned a Negative Rating Outlook, a marked
further deterioration at CMS of more than one notch would create
pressure on Consumers' ratings.

Despite an increasing investment burden over the next few years,
Consumers benefits from relatively predictable cash flows and
sound electric and gas monopoly distribution franchises. Current
credit concerns facing the company primarily relate to its full
regulatory agenda in 2003, which includes a $1.08 billion
securitization request, a $156 million gas rate case, and
ongoing stranded cost proceedings. Major components of the
securitization filing include Clear Air Act compliance costs
($587 million), pension fund contributions at Consumers ($227
million) and capital investments at the Palisades Nuclear Plant
($113 million). While certain items within the regulatory
request submission, such as environmental costs, are less
controversial than others, such as pension costs, Fitch notes
that the inability to receive nominal base rate increases may
place pressure on Consumers' financial condition. The company
expects the Michigan Public Service Commission (MPSC) to act on
the securitization request by June 2003, and assuming MPSC
approval, Consumers plans to issue the bonds by the end of the
current year. Hearings on the gas rate case are currently in
progress, and an MPSC decision regarding interim rate relief
could occur by October 2003, with final rate relief possible by
March 2004.

Consumers, a wholly owned subsidiary of CMS, is a regulated
electric and gas utility serving more than 3.3 million customers
in western Michigan.

Consumers Energy Co.'s 6.000% bonds due 2005 (CMS05USR2) are
trading at 81.5 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=CMS05USR2for
real-time bond pricing.


DAN RIVER: S&P Ups L-T Credit Rating to B+ over Improved Profile
----------------------------------------------------------------
Standard & Poor's Ratings Services raised its long-term
corporate credit rating on home furnishings manufacturer Dan
River Inc. to 'B+' from 'B-'. The ratings are removed from
CreditWatch, where they were placed on March 17, 2003. At the
same time, Standard & Poor's assigned its 'B-' senior unsecured
debt rating to the Danville, Virginia-based company's new 12.75%
senior notes due 2009. The notes are rated two notches below the
corporate credit rating, reflecting their junior position
relative to the significant amount of secured bank debt.
Standard & Poor's also withdrew its existing rating on the $120
million subordinated notes due 2003.

The outlook is stable.

The above facilities replaced the company's existing $125
million revolving credit facility due September 2003 and its
$120 million 10.125% notes due December 2003.

Dan River's total debt outstanding at Dec. 28, 2002, was about
$252 million.

The bank facility consists of a $160 million revolving credit
facility and a $40 million term loan. Availability under the
revolving credit facility will be subject to a borrowing base of
85% eligible accounts receivable, 60% eligible raw material and
finished goods inventory, and 50% eligible work-in-progress
inventory. The term loan will be amortized quarterly, on a
straight-line, seven-year schedule with a balloon payment upon
maturity. The facilities are secured by substantially all assets
of the company.

"The upgrade incorporates Standard & Poor's expectation that Dan
River's improved financial performance in 2002 will be
sustained," said Standard & Poor's credit analyst Susan Ding.
The company's credit protection measures have strengthened,
reflecting its improved inventory controls and asset
utilization. EBITDA interest coverage was 2.9x for the year
ended Dec. 28, 2002, compared with 1.3x in fiscal 2001.
Accordingly, leverage, as measured by total debt to EBITDA, also
improved to 3.0x from 8.0x in 2001. Operating margin for the
same period was about 13.7% versus 6.7% in the prior year.
Standard & Poor's expects Dan River to maintain EBITDA interest
coverage of above 2.5x, total debt to EBITDA of less than 3.5x,
and operating margins above 12%, in order to maintain the new
ratings.

The stable outlook reflects Standard & Poor's expectation that
Dan River can maintain its current credit protection measures
and operating performance in the intermediate term.


CORNING INC: Says On Its Way to Profitability According to Plan
---------------------------------------------------------------
A year after returning to the helm, Corning Incorporated's
(NYSE:GLW) Chairman and CEO, James R. Houghton, told
shareholders that the company is succeeding with its plan to
return to profitability.

"Last year, I told you that we, as a company, were up to the
challenge before us. I told you that we would focus our
priorities in three very distinct areas; that we would dedicate
all our energies toward preserving our financial health, toward
returning to profitability, and toward investing in our
future...I told you that in all these areas we would succeed. My
friends, one year later, we are succeeding," Houghton said.

Houghton's remarks were part of his annual address to more than
500 shareholders assembled for the company's annual meeting in
Corning, N.Y. He thanked the audience for their confidence and
support in the company and presaged Corning's promising future,
"As the economy recovers and the business world begins to look
around to see who's still standing, they'll see Corning because
we have continued to believe we had a future and we have taken
steps so it will be a bright one."

              Financial health and profitability

Houghton pointed out that the company's first-quarter results
were break even, excluding one-time charges, "and our first
quarter operating cash flow was positive." He praised
management's efforts at reducing costs and eliminating slightly
more than $1 billion in debt over the past 15 months.

The chairman also outlined the company's progress toward its
goal of returning to operating profitability, highlighting its
broad and diverse business portfolio as a source of strength.
"The two keys to our return to profitability will be the cost
reduction from last year's restructuring and the momentum from
businesses in what we call our Corning Technologies segment," he
said. In particular, Houghton noted that the liquid-crystal
display business, which creates the glass used in flat panel
desktop computers, notebook computers and the new LCD
televisions are beginning to revolutionize the communications
industry. Houghton also said Corning's environmental products
business is well positioned for continued global growth in both
the automotive and diesel markets.

Houghton reaffirmed Corning's commitment to optical
communications and said that the company expects growth of its
telecommunications business to return over time.

He also told shareholders that the company is monitoring
external trends across all of its markets, ". . . the timing of
our recovery is affected, in great measure, by how the economy
recovers in the wake of the war in Iraq. If world events
continue to put a drain on consumer confidence, on our business
expansions and on the general economy, both here and around the
world, we will be affected too."

                     Investing in the future

Houghton reminded shareholders of the company's continued
commitment to innovation, "And while we have dealt with our
current day business challenges, we have continued to keep a
steady eye on our future . . . today we are broadening our
presence in exciting industries where we are already leaders."
Among the areas he highlighted were new ways of making flat
panel glass, new technologies in the diesel emission control
market, new properties for producing optical fiber and improved
processes to enable new generations of drug discovery.

Looking ahead Houghton said that while the company may continue
to face challenging times, it will not change its three focus
areas. "We firmly believe in the plan we have charted for
ourselves and we will pursue it relentlessly, because it will
pay off."

In other business, shareholders re-elected the following
directors: James B. Flaws, vice chairman and chief financial
officer, Corning Incorporated; James R. Houghton, chairman and
chief executive officer, Corning Incorporated; Jeremy R.
Knowles, Amory Houghton professor of chemistry and biochemistry,
Harvard University; James J. O'Connor, retired chairman of the
board and chief executive officer, Unicom Corporation; Deborah
D. Rieman, retired president and chief executive officer, Check
Point Software Technologies, Incorporated; and Peter F.
Volanakis, president of Corning Technologies, Corning
Incorporated.

Shareholders also approved the 2003 variable compensation plan,
which is designed to provide a competitive incentive opportunity
to attract and retain key executives; the 2003 equity plan for
non-employee directors, which is designed to assist Corning in
attracting and retaining highly qualified board members; and the
amendment of the 2000 employee equity participation program,
which permits employees to obtain equity ownership in Corning.

Established in 1851, Corning Incorporated --
http://www.corning.com-- creates leading-edge technologies that
offer growth opportunities in markets that fuel the world's
economy. Corning manufactures optical fiber, cable and photonic
products in its Telecommunications segment. Corning's
Technologies segment manufactures high-performance display
glass, and products for the environmental, life sciences, and
semiconductor markets.


DELTA FUNDING: Fitch Cuts Series 2000-4 Class B to CCC from BB+
---------------------------------------------------------------
Fitch Ratings has taken rating action on the following Delta
Funding Corporation issue:

Series 2000-4 --Class B is downgraded to 'CCC' from 'BB+'.

The negative rating action taken on series 2000-4 reflects the
poor performance of the underlying collateral in the
transaction. The level of losses incurred have been higher than
expected and have resulted in the depletion of
overcollateralization (OC). As of the April 2003 distribution,
series 2000-4 has $418,119 or 0.87% in OC. Furthermore, the
presence of a 36 month Interest Only (IO) strip siphons off
excess spread that would otherwise be available to cover losses
and to build OC in the deal.

Further information regarding current delinquency, loss, and
credit enhancement statistics is available on the Fitch ratings
web site at http://www.fitchratings.com


DILMUN CAPITAL: S&P Puts BB- Mezzanine Note Rating on Watch
-----------------------------------------------------------
Standard & Poor's Ratings Services placed its rating on the
mezzanine notes issued by Dilmun Capital II Ltd., a high-yield
arbitrage CBO transaction managed by AIG Global Investments
Corp., on CreditWatch with negative implications. AIG Global
Investments Corp. assumed management of the deal March 25, 2003.
At the same time, the 'AAA' rating on the senior class notes is
affirmed, based on a financial guarantee insurance policy issued
by MBIA Insurance Corp.

The CreditWatch placement reflects factors that have negatively
affected the credit enhancement available to support the notes
since the last rating action on Jan. 7, 2003. These factors
include continuing par erosion of the collateral pool securing
the rated notes and a negative migration in the credit quality
of the performing assets in the pool.

As of the most recently available monthly trustee report
(March 31, 2003), the deal holds $22.05 million worth of
securities that are in default, of which $9.8 million was
experienced since the last rating action. Standard & Poor's
noted that as a result of asset defaults, the
overcollateralization ratios for the transaction have suffered
since the last rating action. According to the March 31, 2003
trustee report, the overcollateralization ratio for the
mezzanine class notes was at 93.85%, versus the minimum required
ratio of 105.1%, and compared to a ratio of 102.51% at the time
of the last rating action. The overcollateralization ratio for
the senior class notes was at 98.76%, versus the minimum
required ratio of 109.60%, and compared to a ratio of 107.51% at
the time of the last rating action.

Standard & Poor's noted that its Trading Model test, a measure
of the ability of the credit quality in the portfolio to support
the rating on a given tranche, is out of compliance, according
to the March trustee report. Further, $20.19 million of the
securities currently in the portfolio come from obligors with
ratings currently on CreditWatch with negative implications.

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

                RATING PLACED ON CREDITWATCH NEGATIVE

                       Dilmun Capital II Ltd.

                                 Rating
     Class             To              From   Balance (mil. $)
     Mezzanine Notes   BB-/Watch Neg   BB-              10.55

                           RATING AFFIRMED

                       Dilmun Capital II Ltd.

     Class           Rating   Balance (mil. $)
     Senior Notes    AAA               201.72


DIRECTV LATIN AMERICA: Pulls Plug on Music Choice Contract
----------------------------------------------------------
Pursuant to Sections 105(a) and 365(a) of the Bankruptcy Code,
DirecTV Latin America, LLC sought and obtained the Court's
authority to reject -- effective March 18, 2003 -- an
Affiliation Agreement for International DTH Satellite Exhibition
of Programming, dated as of July 17, 1996, with Music Choice,
formerly Digital Cable Radio Associates.

Joel A. Waite, Esq., at Young Conaway Stargatt & Taylor LLP, in
Wilmington, Delaware, relates that the Music Choice Contract
governs the distribution of Music Choice channels by DirecTV in
Latin America.  Under the current terms, the Music Choice
Contract is expected to cost DirecTV $20,000,000 over the
remaining life of the contract -- until June 2006.

DirecTV has already notified Music Choice of its intention to
reject the Music Choice Contract immediately.  Music Choice has
been advised that DirecTV would cease performing its obligations
on the Petition Date. (DirecTV Latin America Bankruptcy News,
Issue No. 5; Bankruptcy Creditors' Service, Inc., 609/392-0900)


DOBSON: Annual Stockholders' Meeting Set for June 20 in Oklahoma
----------------------------------------------------------------
Dobson Communications Corporation (Nasdaq:DCEL) announced that
its 2003 Annual Meeting of Stockholders will be held on Friday,
June 20, 2003 at 9 a.m. CT. Stockholders are invited to meet at
the Company's headquarters, located at 14201 Wireless Way,
Oklahoma City, 73134, just northeast of the intersection of West
Memorial Road and North Portland Avenue. The shareholder record
date for the annual meeting is April 28, 2003.

Dobson Communications is a leading provider of wireless phone
services to rural markets in the United States. Headquartered in
Oklahoma City, the Company owns or manages wireless operations
in 17 states. For additional information on the Company and its
operations, please visit its Web site at http://www.dobson.net

                         *   *   *

As reported, Standard & Poor's Ratings Services lowered its
corporate credit ratings on cellular service provider Dobson
Communications Corp., and its subsidiary, Dobson Operating Co.
LLC, to 'B' from 'B+' due to the impact of lower roaming yield
on revenue growth, lower net customer additions compared with
guidance for full-year 2002, and overall slower industry growth.
Standard & Poor's also placed the ratings on CreditWatch with
negative implications reflecting the uncertainty related to the
Dobson family loan with Bank of America which matures on
March 31, 2003, unless extended.

Simultaneously, Standard & Poor's lowered its corporate credit
rating on American Cellular Corp., a joint venture between
Dobson Communications and AT&T Wireless Services, to 'CC' from
'CCC-' due to the potential for debt restructuring in the near
term. The rating remains on CreditWatch with negative
implications, where it was placed on April 5, 2002.


DYNEX POWER: Chief Fin'l Officer Bernard Gallagher Leaves Post
--------------------------------------------------------------
Dynex Power Inc., a leading independent power semiconductor
company, announced that Bernard Gallagher has resigned as Chief
Financial Officer and member of the Board of Directors as of the
end of April 2003 for personal reasons.

Robert Lockwood has been named as the new Chief Financial
Officer and will join the Board of Directors. "We are delighted
Robert has decided to join us," announced Michael LeGoff,
President and Chief Executive Officer. "He brings to the company
a wealth of professional skills and experience in financial
planning, reporting, systems management and controllership. In
addition to his broad experience in treasury and finance, he has
excellent experience in operations for Pilkington's European
Automotive Division. He has the exact mix of skills we need for
the future of our business." Mr. Lockwood was formerly with
Coopers Lybrand, after which he was Group Treasurer for both
Rowntree Plc and Pilkington Plc.

Dynex is one of the world's leading designers and manufacturers
of industrial high power semiconductors. The Company's unique
capabilities permit the manufacture of both standard bipolar
semiconductors and new generation insulated-gate bipolar
transistors. The Company's products are used to improve the
reliability and quality of power generation, transmission and
distribution systems, marine and rail electric drives, induction
heating applications, industrial motor drives and controls and
the next generation electric vehicle drive technologies. Dynex
also produces a high-end microwave sensor product used as a
security alarm sensor in premier motor cars. Dynex is
headquartered in Lincoln, UK, which houses the manufacturing,
silicon fabrication, marketing and sales, design and research &
development operations. Sales staff are located worldwide.

Press announcements and other information about Dynex are
available on the World Wide Web at http://www.dynexsemi.com

At Sept. 30, 2002, Dynex Power reported current assets of about
C$17 million and current liabilities topping C$18 million.


EL PASO ELECTRIC: Fitch Withdraws B-Level Bond Ratings
------------------------------------------------------
Fitch Ratings has withdrawn the ratings of El Paso Electric
Company. At the time of withdrawal, the ratings were as listed
below, and the Rating Outlook was Stable.

         -- First mortgage bonds 'BBB-';

         -- Unsecured pollution control revenue bonds 'BB+';

El Paso Electric Company is an integrated utility engaged in the
generation, transmission and distribution of electricity to
approximately 312,000 retail customers in western Texas and
southern New Mexico. On a wholesale basis, the company also
sells power to customers in Texas, New Mexico, and Mexico. The
company's generation portfolio, totaling approximately 1,500MW,
includes a 16% ownership interest in the Palo Verde nuclear
generating station.


ENRON: Cayman Debtor Agrees with JPLs on Compensation Protocol
--------------------------------------------------------------
On March 19, 2002, Debtor Enron India Holdings Ltd., a Cayman
Islands corporation, commenced its reorganization case in the
United States Bankruptcy Court for the Southern District of New
York.  On April 4, 2002, EIHL filed a petition before the Grand
Court of the Cayman Islands.  On April 10, 2002, the Cayman
Court entered an order, among other things, appointing George
Lanyon Bullmore and Simon Lovell Claton Whicker of KPMG in the
Cayman Islands as EIHL's Joint Provisional Liquidators.  The
JPLs were appointed in the Cayman Islands to ensure the
coordinated better realization of EIHL's business and affairs
under the provisions of the Cayman Court in accordance with the
laws of the Cayman Island.

Among other things, the Cayman Order provides that:

     -- the JPLs have the power "to retain and employ barristers,
        attorneys or solicitors and other agents or professional
        persons as the JPLs deem fit, in Cayman and elsewhere as
        the JPLs deem appropriate, for the purpose of advising
        and assisting in the execution of their powers;"

     -- the JPLs have the power "to render and pay invoices out
        of the Debtors' assets for their own remuneration at
        their usual and customary rates;"

     -- the JPLs will be at liberty to submit to the Cayman
        Court bills of costs for taxation of all costs, charges
        and expenses of those persons or firms employed by them;
        and

     -- the JPLs have the power "to enter into protocol or other
        agreements as the JPLs deem appropriate for the
        ordination of these proceedings, the Chapter 11 case and
        any other like proceedings of the winding up,
        restructuring or reorganization of other companies within
        the Enron Group, and to seek the approval of the Cayman
        Court or the U.S. Bankruptcy Court, as appropriate."

By an Administrative Order, the U.S. Bankruptcy Court
established the procedures for Interim Compensation and
Reimbursement of Expenses of the Debtor Professionals and
Official Committee Members, as amended.

To promote cooperation and comity among the U.S. Bankruptcy
Court and the Cayman Court and to avoid jurisdictional disputes
with respect to the payment of the fees and expenses of the
JPLs, each of their professionals rendering services to them in
the Cayman Islands or elsewhere, not including any U.S.
professionals - the Foreign JPL Professionals -- and any U.S.
professionals retained or to be retained by the JPLs in the
U.S., EIHL and the JPLs stipulate and agree to certain
procedures for the payment of the fees and expenses of the JPLs,
the Foreign JPL Professionals and the U.S. JPL Professionals.

Specifically, the Parties agree that:

A. The Cayman Court will have sole jurisdiction and power to
     determine the compensation of the JPLs and the Foreign JPL
     Professionals rendering services to the JPLs;

B. The JPLs and all Foreign JPL Professionals and the U.S. JPL
     Professionals  will be compensated for their services in
     accordance with the laws of the Cayman Islands or other
     orders of the Cayman Court;

C. Except as otherwise provided, the fees and expenses of
     the JPLs, the Foreign JPL Professionals and the U.S. JPL
     Professionals will be paid first from EIHL's assets and only
     if there is a shortfall, by Enron Corp., from funds
     contained in either of their prepetition bank accounts and
     any accounts opened by them postpetition without necessity
     of further U.S. Bankruptcy Court order, and according to the
     terms of those order, which have been or may be entered by
     the Cayman Court.  EIHL and Enron Corp. will be permitted to
     transfer funds to and from each of the Debtors' Accounts to
     fund the payment of professional fees and expenses in
     accordance with this Fee Protocol.  EIHL and Enron Corp.
     will keep and maintain accurate books and records of all of
     the Transfers, categorized as being for the JPLs, the
     Foreign JPL Professionals or the U.S. JPL Professionals, and
     provide details and summary information regarding the cash
     disbursements to the Official Committee of Creditors and
     other appropriate parties, as required by, and in accordance
     with, the Amended Cash Management Order.  The Transfers will
     constitute claims for administrative expenses of the
     transferor's estates against the transferee's estate;

D. To provide an efficient and convenient manner to enable the
     Debtors, the Committee and the U.S. Trustee -- the Estate
     Representatives -- to review or comment on the fees and
     expenses of the JPLs and the Foreign JPL Professionals, the
     JPLs will first submit any request for reimbursement of the
     fees and expenses of JPLs and the Foreign JPL Professionals
     to the Estate Representatives by overnight delivery.  No
     later than 10 business days from the date the Foreign JPL
     Fee Request is served, the Estate Representatives must
     advise the JPLs in writing whether or not they approve of or
     object to the Foreign JPL Fee Request.  In the event the
     Estate Representatives approve a Foreign JPL Fee Request,
     the JPLs may seek approval of the Foreign JPL Fee Request
     from the Cayman Court and, if approved, the fees and
     expenses covered by the Foreign JPL Fee Request will be paid
     by Enron Corp. or EIHL from funds contained in either of
     their Accounts according to the terms of those orders which
     have been or may be entered by the Cayman Court;

E. In the event that any of the Estate Representatives object to
     a Foreign JPL Fee Request, the parties agree in good faith
     to try and resolve any objections within five business days
     from the date the objections are served to the JPLs.  If the
     objections cannot be resolved, the JPLs will file within
     three business days an appropriate pleading, including the
     Foreign JPL Fee Request together with any objections from
     any of the Estate Representatives, with the Cayman Court so
     that the matter can be heard at the first available hearing
     date; provided, however, the JPLs may seek approval of any
     fees and expenses which are not objected to from the Cayman
     Court at the same time and, if approved, the fees and
     expenses will be paid first from EIHL's assets and only if
     there is a shortfall, by Enron Corp. form funds contained in
     the DIP Accounts without necessity of further Bankruptcy
     Court order according to the terms of those orders, which
     have been or may be entered by the Cayman Court;

F. The JPLs will first submit any request for reimbursement of
     the fees and expenses of the U.S. JPL Professionals to the
     Estate Representatives by overnight delivery.  No later than
     10 business days from service, the Estate Representatives
     must advise the JPLs in writing whether or not they approve
     of or object to a U.S. JPL Fee Request.  In the event the
     Estate Representatives approve a U.S. JPL Fee Request, the
     JPLs may seek approval of the U.S. JPL Fee Request from the
     Cayman Court and, if approved, the fees and expenses
     covered by the U.S. JPL Fee Request will be paid by Enron
     Corp. or EIHL from funds contained in either of their DIP
     Accounts without necessity of further order of the U.S.
     Bankruptcy Court according to the terms of those orders
     which have been or may be entered by the Cayman Court;

G. In the event that any of the Estate Representatives objects
     to a U.S. JPL Fee Request, the parties agree in good faith
     to try to resolve any objections within five business days
     from the date any objections are served on the JPLs.  If the
     objections cannot be resolved, the JPLs will file within
     three business days thereafter an appropriate pleading,
     including the U.S. JPL Fee Request together with any
     objections from any of the Estate Representatives, with the
     U.S. Bankruptcy Court so the matter can be heard at the next
     available hearing date in order to enable the U.S.
     Bankruptcy Court to issue its non-binding ruling and
     recommendation to the Cayman Court regarding the Contested
     U.S. JPL Fee Request; provided, however, the JPLs may seek
     approval of any fees and expenses which are not objected to
     from the Cayman Court at the same time and, if approved,
     those fees and expenses will be paid first from the assets
     of EIHL and only if there is a shortfall, by Enron Corp.
     from funds contained in either of their DIP Accounts without
     necessity of further order of the U.S. Bankruptcy Court
     according to the terms of those orders which have been or
     may be entered by the Cayman Court.  The JPLs will have five
     business days from the date the pleading is filed to reply
     to any objections.  In addition, the Fee Committee and its
     employees, or the Applications Analyst will have an
     opportunity to review and comment upon the Contested U.S.
     JPL Fee Request in order to assist the U.S. Bankruptcy Court
     with its non-binding ruling and recommendation with respect
     to any Contested U.S. JPL Fee Request.  Upon the non-binding
     ruling and recommendation of the U.S. Bankruptcy Court, the
     JPLs will file a copy of the U.S. Bankruptcy Court's non-
     binding ruling and recommendations with the Cayman Court
     together with the Contested U.S. JPL Fee Request so that the
     Cayman Court can ultimately decide the Contested U.S. JPL
     Fee Request in accordance with the laws of the Cayman
     Islands or other orders of the Cayman Court.  If, at the
     Hearing, the U.S. Bankruptcy Court declines to issue a non-
     binding ruling and make any recommendations to the Cayman
     Court with respect to a Contested U.S. JPL Fee Request, the
     JPLs will be entitled to seek approval of the fees and
     expenses from the Cayman Court and the fees and expenses of
     any U.S. JPL Professionals will be paid first from the
     assets of EIHL and only if there is a shortfall, by Enron
     Corp. from funds contained in its DIP Accounts without
     necessity of further order of the U.S. Bankruptcy Court
     according to the terms of those orders which have been or
     may be entered by the Cayman Court;

H. The JPLs, the Foreign JPL Professionals and the U.S. JPL
     Professionals and the Foreign JPL Professionals will have
     the right and standing to:

     (a) appear and be heard in the U.S. Bankruptcy Court with
         respect to any issues and matters relating to this Fee
         Protocol, including but not limited to any hearing which
         may be held in connection with a Contested U.S. JPL Fee
         Request, to the same extent as creditors and other
         interested parties domiciled in the forum country,
         subject to any local rules and regulations generally
         applicable to all parties appearing in the forum, and

     (b) file notices of appearance or other papers with the
         clerk of the U.S. Bankruptcy Court: provided, however,
         that any appearance or filing in the U.S. Bankruptcy
         Court with respect to any issues and matters relating to
         this Fee Protocol will not form a basis for personal
         jurisdiction in the United States over the JPLs, the
         Foreign JPL Professionals or the U.S. JPL Professionals;

I. The Estate Representatives will have the right and standing
     to:

     (a) appear and be heard in the Cayman Court with respect
         to any issues and matters relating to this Fee Protocol,
         including, but not limited to, any request for fees and
         expenses of the JPLs, to the same extent as creditors
         and other interested parties domiciled in the forum
         country, subject to any local rules or regulations
         generally applicable to all parties appearing in the
         forum, and

     (b) file notices of appearance or other papers with the
         Cayman Court; provided, however, that any appearance
         by any of the Estate Representatives in the Cayman
         Court with respect to any issues and matters relating to
         this Fee Protocol, including but not limited to, any
         request for fees and expenses of the JPLs, will not form
         a basis for personal jurisdiction in the Cayman Islands
         over the Estate Representatives, their representatives
         or professionals; and

J. Neither the terms of this Fee Protocol, nor any actions taken
     under the terms of this Fee Protocol, will prejudice or
     affect the powers, rights, claims and defenses of the
     Debtors and their estates, the Committee, any of the Estate
     Representatives, the JPLs, the Foreign JPL Professionals,
     the U.S. JPL Professionals or any of the Enron Debtors'
     creditors under applicable law, including the United States
     Bankruptcy Code and the laws of the Cayman Islands. (Enron
     Bankruptcy News, Issue No. 62; Bankruptcy Creditors'
     Service, Inc., 609/392-0900)


EPICOR SOFTWARE: Yearly Shareholders' Meeting Set for May 20
------------------------------------------------------------
The Annual Meeting of Stockholders of Epicor Software
Corporation, a Delaware corporation, will be held on Tuesday,
May 20, 2003 at 10:00 a.m., Pacific Time, at the offices of the
Company located at 195 Technology Drive, Irvine, California
92618-2402, telephone number (949) 585-4000, for the following
purposes:

  1. To elect four (4) directors to serve until the next annual
     meeting of stockholders or until their successors are
     elected and qualified.

  2. To approve an amendment to the Company's 1999 Nonstatutory
     Stock Option Plan to increase the number of authorized
     shares by 4,000,000.

  3. To ratify the appointment of Deloitte & Touche, LLP, as
     independent auditors of the Company for the fiscal year
     ending December 31, 2003.

  4. To transact such other business as may properly come before
     the meeting or any adjournment thereof.

Only stockholders of record at the close of business on April 4,
2003 are entitled to notice of and to vote at the meeting.

Epicor Software's December 31, 2002 balance sheet shows that
total current liabilities exceeded total current assets by about
$12 million, while net shareholders' equity has shrunk to about
$4 million, from about $7 million as recorded in the year-ago
period.


FASTENTECH: S&P Assigns B- Rating to Proposed Senior Sub. Notes
---------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B-' rating on
FastenTech Inc.'s proposed offering of $175 million senior
subordinated notes due in 2011 (144A with registration rights).
In addition, Standard & Poor's assigned its 'BB' secured bank
loan rating on FastenTech's proposed $40 million revolving
credit facility due in 2008. The 'B+' corporate credit rating
was affirmed on privately held FastenTech Inc. The outlook is
stable.

The closely held Bloomington, Minn.-based company is a growing
global manufacturer and marketer of highly engineered specialty
fasteners. FastenTech had about $180 million of debt outstanding
at March 31, 2003.

"Ratings are not expected to change over the intermediate term,
as the company is expected to maintain its current financial
profile even as it pursues acquisitions," said Standard & Poor's
credit analyst John Sico.

The company expects to achieve growth through new product
innovation and marketing. The company has more than 100 U.S.
patents. FastenTech has recently improved its operating margins,
notwithstanding difficult economic conditions.

However, annual fixed-price contracts for the company's steel
supply expire in December 2003 and account for about 80% of its
steel purchases. In addition, the company has agreements with
five unions that cover half of its workforce and three of these
contracts expire in December 2003, May 2004, and June 2004,
respectively.


FIBERCORE INC: Requests Hearing to Challenge Nasdaq Delisting
-------------------------------------------------------------
FiberCore, Inc. (Nasdaq: FBCEE), a leading manufacturer and
global supplier of optical fiber and preform for the
telecommunication and data communications markets, announced
that on April 17, 2003 it had received a notification of
delisting from Nasdaq. Wednesday last week, the Company issued a
press release stating that it would not contest this
determination. The following day, the Company revised its
decision and has filed for a hearing to contest this
determination.

The Company has not yet filed its annual report on Form 10-K
with the SEC due to delays in finalizing the results from its
foreign subsidiaries. The Company had previously filed for an
extension on Form 12b-25, which expired on April 15, 2003. The
Company currently anticipates filing its Form 10-K within the
next 15 days.

As a result of not timely filing its 10-K, the Company received
a Nasdaq staff determination on April 17 indicating that the
Company fails to comply with the filing requirements for
continued listing set forth in Marketplace Rule 4310(C)(14), and
further that the Company is late in paying fees to Nasdaq which
is a failure to comply with Marketplace Rule 4310(C)(13), and
that its securities are, therefore, going to be delisted from
the Nasdaq Smallcap Market at the opening of business on
April 28, 2003. Accordingly, the trading symbol for the
Company's securities was changed from FBCE to FBCEE at the
opening of business on April 22, 2003.

Previously, the Company had been notified that it would be
delisted from the Nasdaq Smallcap on May 29, 2003 due to failure
to meet minimum bid requirements.

If the Company should eventually be delisted, it would suffer
material adverse consequences as set forth in a previous
announcement.

FiberCore, Inc. develops, manufactures, and markets single-mode
and multimode optical fiber preforms and optical fiber for the
telecommunications and data communications markets. In addition
to its standard multimode and single-mode fiber, FiberCore also
offers various grades of fiber for use in laser-based systems up
to 10 gigabits/sec, to help guarantee high bandwidths and to
suit the needs of Feeder Loop (also known as Metropolitan Area
Network), Fiber-to-the Curb, Fiber-to-the Home and Fiber-to-the
Desk applications. Manufacturing facilities are presently
located in Jena, Germany and Campinas, Brazil.

For more information about the company, its products, or
shareholder information please visit http://www.FiberCoreUSA.com

As reported in Troubled Company Reporter's April 7, 2003
edition, it was announced that while the Company has yet to
reach a definitive agreement regarding the terms of any new
financing, the Company is engaged in continuing discussions with
several investor groups. In the meantime, the Company has made
progress with respect to its German operations, where it has
successfully re-scheduled approximately 95% of the obligations
owed to creditors in connection with FiberCore Jena AG's Phase
II expansion and operations. Depending upon the success and
timing of any potential new financing, further restructuring
(including extensions of debt payments) may be needed. While
some financing had been delayed and/or withdrawn by German
governmental and other financial institutions earlier in the
year, approximately 25% of this financing has been reinstated or
replaced over the past month, thus reducing the amount of new
financing required. The Company had previously restructured and
rescheduled most of its bank debt and supplier obligations at
its Brazilian subsidiary, Xtal FiberCore Brasil, S.A.

The Company continues to execute its operational restructuring
plan by reducing operational and administrative costs including
staffing reductions. Based on the March sales level, which is
running somewhat below 2002 levels for the same period, the
Company expects to generate a break-even EBITDA, on a
consolidated basis, when the restructuring plan is fully
implemented. Going forward, the Company expects EBITDA to
improve if sales increase over the course of the year and exceed
2002 levels, as the Company anticipates.

Dr Mohd Aslami, CEO and President commented, "This is a very
difficult period for FiberCore as we continue to make every
effort to work through our current liquidity difficulties. Even
though March orders and shipments in our multi-mode business
were at record volume levels, weak pricing offset this. As for
the market, the telecommunications industry is still
experiencing the worst downturn in its history. Now, after about
a 50% decline in 2002 from 2001 highs, the worldwide optical
fiber market appears poised for an upturn. Industry sources
expect 2003 to be flat to up slightly from 2002, and then
anticipate growth through 2007. While the growth is expected
worldwide, the growth in the U.S. is expected in the "last
mile", which includes fiber-to- the-home applications, where
FiberCore is focused. Moreover, FiberCore's growth is not
dependent on the overly built U.S. telecom long haul segment.
With capacity drastically reduced as a consequence of the sharp
decrease in demand over the last two years, prices should
increase as demand steadily increases. This should create a
significant market recovery opportunity for FiberCore, the only
pure-play fiber supplier in the industry."

"To support the Company's return to profitability, FiberCore has
significant available capacity, a solid, global customer base
and has developed new technology improvements, which will
contribute to further cost reductions. Unfortunately, the
implementation of this new process technology has been delayed
because of the present financial situation, but our planned
restructuring, when implemented, will allow us to fully utilize
the new POVD facility," concluded Dr. Aslami.


FLEMING COMPANIES: Proposes Reclamation Claim Procedures
--------------------------------------------------------
According to Christopher J. Lhulier, Esq., at Pachulski Stang
Ziehl Young Jones & Weintraub, P.C., in Wilmington, Delaware,
the Fleming Companies Inc. Debtors are the largest multi-tier
distributor of consumable goods in the United States, selling
products to 45,000 locations, including, but not limited to,
supercenters, discount stores, convenience stores, drug stores,
and supermarkets.  These consumable products include a variety
of general merchandise, health and beauty care, groceries,
produce, and numerous other items.  The products are purchased
from a diverse range of vendors.  The Debtors also have a
smaller retail division.  In the fiscal year ended December 31,
2002, the Debtors generated total net sales of $17,700,000,000.

Given the volume of inventory received by the Debtors, Mr.
Lhulier expects that a number of vendors may assert reclamation
claims against the Debtors and otherwise interfere with the
delivery of goods to the Debtors after receiving notice of the
commencement of the Chapter 11 cases.  Indeed, as of April 2,
2003, the Debtors have already received numerous written
reclamation demands.  The goods at issue are essential to the
Debtors, and their business operations will be severely
disrupted if vendors are allowed to exercise their right to
reclaim goods without a uniform procedure that is fair to all
parties.

Moreover, Mr. Lhulier believes that the size of the Debtors'
businesses generally and, in particular, the volume of inventory
receipts and sales make it infeasible for the Debtors to return
inventory shipments to vendors in response to reclamation
notices.  If vendors were allowed to seek to exercise their
right to reclaim goods without a uniform procedure that is fair
to all parties, management's attention would be distracted from
operating the Debtors' business.

As a result, the Debtors propose these procedures for processing
and treatment of reclamation claims:

     A. Any vendor asserting a claim for reclamation must satisfy
        all requirements entitling it to a right of reclamation
        under applicable state law and Section 546(c)(1) of the
        Bankruptcy Code.

     B. The Debtors will file a motion, on notice to parties-in-
        interest, listing those reclamation claims, if any, that
        they deem to be valid pursuant to the Order requested.

     C. Absent further order of the Court, the motion will be
        brought by the Debtors within 90 days of the Court's
        entry of an order approving this Motion.

     D. If the Debtors fail to bring this motion within the
        required period of time, any holder of a reclamation
        claim may bring this motion on its own behalf but may not
        bring this motion earlier than 90 days after the Court's
        entry of an order approving this Motion;

     E. All parties-in-interest will have the right and
        opportunity to object to the inclusion or omission of any
        asserted reclamation claim in connection with the motion.

     F. All reclamation claims allowed by the Court pursuant to
        the motion will be treated in accordance with the terms
        of the order allowing these claims.

Mr. Lhulier believes that this process will streamline
resolution of the putative reclamation claims that have been and
are likely to be asserted against the estates.  The Debtors
believe it is in the best interests of the estates to implement
the process for claimants that hold reclamation claims that
satisfy every element of Section 546(c) of the Bankruptcy Code.

Moreover, the Debtors request that the Court authorize them to
make goods available for pick-up by any reclaiming seller:

     -- who timely demands in writing reclamation of goods
        pursuant to Section 546(c) of the Bankruptcy Code;

     -- whose goods the Debtors have accepted for delivery; and

     -- who properly identifies the goods to be reclaimed.

Additionally, the Debtors ask that the Court prohibit the
reclamation claimants and others from seeking to reclaim or
interfere with the delivery of goods to or by the Debtors.  This
relief will facilitate uninterrupted operations of the Debtors'
worldwide business.

Mr. Lhulier asserts that the relief requested will ensure the
maintenance of a supply of goods that will be vital to
maintaining the Debtors' current operations and integral to
maximizing the value of these estates.  See In re Continental
Airlines Inc., 125 B.R. at 417-18 (denying reclamation of
equipment and granting administrative expense claim to creditor
where equipment was necessary to the debtors' reorganization).
Relief similar to that sought herein has been granted in other
recent, large Chapter 11 cases in this District.  See In re W.R.
Grace & Co., Case No. 01-1139 (JJF) (Bankr. D. Del. May 3,
2001); In re U.S. Office Prods. Co., Case No. 01-0646 (PJW)
(Bankr. D. Del. Mar. 28, 2001); In re Trans World Airlines.
Inc., Case No. 010056 (PJW) (Bankr. D. Del. Jan. 10, 2001).
(Fleming Bankruptcy News, Issue No. 3; Bankruptcy Creditors'
Service, Inc., 609/392-0900)

Fleming Companies Inc.'s 10.625% bonds due 2007 (FLM07USR1),
DebtTraders says, are trading at 1 cent-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=FLM07USR1for
real-time bond pricing.


FORT WASHINGTON: S&P Ratchets 2nd Priority Notes Rating to BB-
--------------------------------------------------------------
Standard & Poor's lowered its ratings on the senior notes and
the second priority senior notes issued by Fort Washington CBO
I, an arbitrage CBO transaction collateralized primarily by
high-yield bonds, and managed by Fort Washington Investment
Advisors Inc.

At the same time, the ratings are removed from CreditWatch with
negative implications, where they were placed on Feb. 7, 2003.

The lowered ratings reflect factors that have negatively
affected the credit enhancement available to support the notes
since the transaction was originated in December 1998. These
factors include continuing par erosion of the collateral pool
securing the rated notes, and a negative migration in the
overall credit quality of the assets within the collateral pool.

Since the October 2002 rating action, $5.2 million in new asset
defaults have occurred. According to the most recent monthly
report (March 25, 2003), the senior par value test is marginally
out of compliance at 116.4% versus its minimum required ratio of
117.0%. This compares to a ratio of 127.9% at the time the
transaction was originated, and a value of 116.8% at the time of
the October 2002 rating action. The second priority par value
test is currently at 106.7%, versus the minimum required ratio
of 111.0%, compared to a ratio of 117.9% at close, and a ratio
of 107.3% at the time of the October 2002 rating action.

The credit quality of the collateral pool has deteriorated since
the October 2002 rating action. Including defaulted assets,
27.51% of the assets in the portfolio currently come from
obligors with Standard & Poor's ratings of 'CCC+' or below, and
7.2% of the performing assets within the collateral pool come
from obligors with ratings on CreditWatch with negative
implications. Furthermore, Standard & Poor's Trading Model test,
a measure of the amount of credit quality in the current
portfolio to support the ratings assigned to the liabilities, is
currently out of compliance for both the senior and second
priority senior notes.

Standard & Poor's has reviewed the results of the current cash
flow runs generated for Fort Washington CBO I to determine the
level of future defaults the rated tranches can withstand under
various stressed default timing and interest rate scenarios,
while still paying all of the rated interest and principal due
on the notes. After 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 currently assigned to the notes were no longer
consistent with the amount of credit enhancement available,
resulting in the lowered ratings.

Standard & Poor's will continue to monitor the performance of
the transaction to ensure that the ratings reflect the amount of
credit enhancement available.

      RATINGS LOWERED AND REMOVED FROM CREDITWATCH NEGATIVE

                     Fort Washington CBO I

                         Rating                 Balance (mil. $)
      Class          To          From           Current  Original
      Senior         A           A+/Watch Neg   179.285  192.500
      2nd Priority   BB-         BB/Watch Neg    16.250   16.250


FOUNTAIN VIEW: Bankruptcy Court Approves Disclosure Statement
-------------------------------------------------------------
The U.S. Bankruptcy Court for the Central District of California
approved Fountain View Inc.'s Disclosure Statement, paving the
way for the Company to commence solicitation of votes from its
creditors and shareholders on the Plan of Reorganization. The
confirmation hearing has been scheduled for July 3, 2003 at
11:00 a.m.

"Now that the Court has set the July 3rd date for the
confirmation hearing, our successful emergence from Chapter 11
is clearly in sight," said Chief Executive Officer, Boyd
Hendrickson. "Because of the improvements in our operations that
we have achieved during our restructuring, we expect to emerge
from Chapter 11 better positioned than ever to provide our
facilities' residents with the high quality healthcare that has
long been Fountain View's trademark.

"We are very pleased that the Plan of Reorganization not only
provides for the payment of all unsecured claims in full with
interest, but that existing shareholders will receive
substantially all of the equity of the reorganized company. This
extraordinary outcome is a credit to all of our employees who
were never distracted by our financial reorganization, as well
as the excellent counsel that we received from our outside
consultants, including our restructuring advisors, Crossroads
LLC, and Klee Tuchin Bogdanoff & Stern LLP of Los Angeles, our
bankruptcy counsel," Hendrickson added.

The Company along with 22 operating subsidiaries filed voluntary
petitions for Chapter 11 reorganization on October 2, 2001 in
the Central District of California, Los Angeles Division. The
Honorable Sheri Bluebond is presiding over the Fountain View
Chapter 11 case.

Fountain View is a leading operator of long-term care facilities
and provider of a full continuum of post-acute care services,
with a strategic emphasis on sub-acute specialty medical care.
Presently headquartered in Foothill Ranch, California, the
Company employs approximately 6,400 employees who serve
approximately 5400 residents daily in facilities throughout
Southern and Central California, as well as in 18 counties in
Texas, including 43 skilled nursing and five assisted living
facilities. In addition to long-term care, the Company provides
a variety of high-quality ancillary services such as physical,
occupational and speech therapy and pharmacy services. The
Company generates annual revenues in excess of $340 million.


GENERAL BINDING: Stockholders to Convene on May 22 in Illinois
--------------------------------------------------------------
The annual meeting of the stockholders of General Binding
Corporation will be held on Thursday, the 22nd day of May, 2003
at 3:30 p.m. local time, in the Auditorium of the Chicago
Botanic Gardens, 1000 Lake Cook Road, Glencoe, Illinois for the
following purposes:

      1. To elect a board of nine directors for the ensuing year.

      2. To act upon a proposal to approve and adopt the General
         Binding Corporation Senior Management Incentive
         Compensation Program.

      3. To act upon a proposal to ratify the selection of
         PricewaterhouseCoopers LLP as independent public
         accountants for the year 2003.

      4. To transact such other business as may properly come
         before the meeting.

Only stockholders of record at the close of business on March
28, 2003, are entitled to notice of, and to vote at, this
meeting or any adjournment thereof.

GBC -- whose corporate credit is currently rated at B+ by
Standard & Poor's -- is a world leader in products that bind,
laminate, and display information so people can accomplish more
at work, school and home. GBC's products are marketed in more
than 100 countries under the GBC, Quartet, and Ibico brands, and
they help people organize and communicate ideas and enhance
printed materials.


HARVEST NATURAL: S&P Affirms CCC+ Rating; Outlook Now Stable
------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'CCC+' corporate
credit rating on Harvest Natural Resources Inc. and revised its
outlook on the company to stable from negative.

Houston, Texas-based Harvest has about $100 million in
outstanding debt.

"The outlook revision follows a similar change to our outlook
for the ratings on the Bolivarian Republic of Venezuela
(CCC+/Stable/--) and Harvest's resumption of production and
sales to Petroleos de Venezuela S.A. (PDVSA; CCC+/Stable/--),
Venezuela's national oil company. As a result, we believe there
is less uncertainty surrounding future production sales--hence,
cash flow--from Harvest's Venezuela operations," said Standard &
Poor's credit analyst Daniel Volpi.

Harvest's production sales to PDVSA were interrupted from
Dec. 14, 2002 to Feb. 6, 2003 due to political turmoil in
Venezuela. Harvest estimates that it lost roughly 1.6 million
barrels of sales to 1.9 million barrels of sales over the fourth
quarter of 2002 and the first quarter of 2003. With a resumption
of more normalized production levels, currently about 25,000
barrels per day (bpd), 2003 production is estimated to average
about 22,000 bpd to 25,000 bpd, compared with 26,000 bpd in
2002.

Harvest relies on its operations in Venezuela and its service
agreement with PDVSA for essentially all of its operating cash
flow. The ratings on the company are constrained by the
political risk attendant to its Venezuela operations.

The stable outlook reflects Standard & Poor's expectations that
Harvest will maintain normal production sales to PDVSA. Until
the company becomes less reliant on its Venezuela operations,
its ratings will track those of PDVSA and Venezuela.


GLIMCHER REALTY: First Quarter 2003 Results Show Improvement
------------------------------------------------------------
Glimcher Realty Trust, (NYSE: GRT), one of the country's premier
retail REITs, reported results for its first quarter ended
March 31, 2003. Funds From Operations per diluted share were
$0.56 for the first quarter of 2003 compared to $0.59 for the
first quarter ended March 31, 2002. Revenues in the quarter
increased 28% primarily due to the inclusion of $11.9 million of
revenues for five malls reported as joint ventures in the first
quarter of 2002 and lease termination income of $4.8 million.
FFO for the first quarter increased 5.8% to $21.2 million,
compared with $20.0 million in the first quarter of 2002, but
was lower on a per share basis due to dilution from the
Company's equity offering in July 2002. The Company recorded in
the quarter a $5.6 million increase in bad debt expense and a
$628,000 reduction in minimum rent revenues as a result of
modifying the calculation of straight-line rents for certain
leases. The increase in bad debts and the modification to the
calculation of straight-line rents negatively impacted first
quarter FFO by $0.14 and $0.02 per diluted share, respectively.
FFO is an industry standard measure for evaluating operating
performance defined as net income plus real estate depreciation
less gains or losses from depreciable property sales,
extraordinary items and cumulative effect of accounting changes.

"Our first quarter operating results demonstrate the quality of
our mall portfolio and balance sheet during these difficult
economic times," said Michael P. Glimcher, President. "Despite
reporting lower FFO per share for the first quarter, we are
encouraged by our mall occupancy statistics and the impact our
strengthened balance sheet had on our operating results. Mall
store occupancy increased in the quarter to 89.4%, as compared
to 86.2% for the comparable period in 2002. Debt-to-market
capitalization of 57.3% at March 31, 2003 is the lowest since
June 1998, and compares to 61.3% in the first quarter of 2002."

Revenues increased 27.7% or $16.9 million to $77.7 million for
the three months ended March 31, 2003 as compared to $60.9
million for the comparable period in 2002. In the third and
fourth quarters of 2002, the Company acquired the third party
joint venture interest in four malls (Dayton Mall, SuperMall of
the Great Northwest, Almeda Mall and Northwest Mall), and in the
first quarter of 2003 the Company acquired the third party joint
venture interest in Colonial Park Mall. First quarter revenues
of $11.9 million for these five malls represented 71% of the
revenue increase from the comparable period in 2002. Also
contributing to the revenue increase was $4.8 million of lease
termination income, partially offset by a $1.0 million reduction
in revenues resulting from mall anchor tenant vacancies and a
$628,000 reduction in minimum rent revenues.

The reduction in minimum rent revenues of $628,000, or $0.02 per
diluted share, is the result of modifying the calculation of
straight-line rents for certain leases. The change involves
three leases, the oldest of which originated in 1997. In
applying the change, cumulative straight-line rent receivables
that had been recorded in previous years were reversed and
deferred income was recorded to the extent that cash received
exceeded the amount currently recognizable as rent.

During the quarter the Company increased its provision for
credit losses by $5.6 million. The majority of this increase is
a specific provision attributable to 2002 and 2001 estimated
tenant recoveries for common area maintenance, taxes and
insurance at the Company's three value malls (Jersey Gardens,
Great Mall and SuperMall of the Great Northwest). The Company's
policy is to record the estimated recovery as an accounts
receivable monthly throughout the year, and based on actual
expenses incurred, true up the recorded receivable subsequent to
the finalization of the Company's prior year financial results.

First quarter net income includes the expensing of stock options
granted in 2003.

For the quarter ended March 31, 2003, the Company realized same-
store mall revenue and NOI growth of 2.5% and 7.6%,
respectively, compared to the first quarter of 2002. Same-store
community center revenue and NOI decreased 0.4% and 11.7%,
respectively, compared to the first quarter of 2002.

            Asset Sale and Joint Venture Acquisition

During the quarter, the Company recorded a $698,000 gain in
connection with the $9.25 million sale of Southside Plaza, a
172,293 square foot community center located in Sanford, North
Carolina. The property was unencumbered at the time of the sale
and net proceeds were used to repay short-term borrowings under
the Company's line of credit. First quarter net income includes
a provision for losses related to assets held for sale of $2.3
million for two community center assets.

On March 6, 2003, the Company acquired for $5.5 million in cash
the 50% third party joint venture interest in Colonial Park
Mall, a 745,394 square foot enclosed regional mall located in
Harrisburg, Pennsylvania. As of March 31, 2003, the Company had
sole ownership in 21 of its 23 regional malls.

                 Permanent Financing Secured

On April 1, 2003, the Company secured permanent financing for
Polaris Fashion Place, located in Columbus, Ohio. The Company
owns a 39.3% interest in this property. The new debt consists of
a 10-year $150 million non-recourse loan at a fixed interest
rate of 5.24% and a 30-year principal amortization schedule. The
loan is secured by Polaris Fashion Place, a 1.6 million square
foot upscale regional mall that includes seven anchor stores.
The proceeds of the financing were utilized to repay an existing
$119.4 million construction loan. The remaining funds were
distributed to the members on the basis of their equity
interests in the project and to repay member advances.

The Company has also received a commitment and executed a rate
lock agreement in connection with the refinancing of $130
million of non-recourse debt secured by Lloyd Center located in
Portland, Oregon. The current Lloyd Center mortgage matures
November 10, 2003, and has a repayment option on May 10, 2003.
The new debt is to be a 10-year non-recourse loan of
approximately $140 million that will bear interest at a fixed
rate of approximately 5.50% with a 30-year principal
amortization schedule.

                             Outlook

The Company expects FFO for 2003 to be in the range of $2.50 to
$2.58 per diluted share. This guidance incorporates actual first
quarter results and assumes additional asset sales in 2003 of
$27 million.

                      Dividend Performance

For the first quarter of 2003, the Company declared a cash
dividend of $0.4808 per common share, which was paid on April
15, 2003, to common shareholders of record as of March 31, 2003.
The cash dividend is equivalent to $1.9232 on an annualized
basis. The Company also paid a cash dividend of $0.578125 on its
9.25% Series B Preferred Shares on April 15, 2003, to
shareholders of record on March 31, 2003. On an annualized
basis, this is the equivalent of $2.3125 per preferred share.

Glimcher Realty Trust -- a real estate investment trust whose
corporate credit and preferred stock ratings are rated by
Standard & Poor's at BB and B, respectively -- is a recognized
leader in the ownership, management, acquisition and development
of enclosed regional and super-regional malls, and community
shopping centers.

Glimcher Realty Trust's common shares are listed on the New York
Stock Exchange under the symbol "GRT." Glimcher Realty Trust is
a component of both the Russell 2000(R) Index, representing
small cap stocks, and the Russell 3000(R) Index, representing
the broader market.


HAYES LEMMERZ: Voting & Confirmation Objection Deadline is Today
----------------------------------------------------------------
At Hayes Lemmerz International, Inc. and its debtor-affiliates'
amended request, the Court:

     A. extended the Voting Deadline to April 28, 2003 at 4:00
        p.m. Prevailing Eastern Time for Classes 2, 3 -
        including sub-Classes 3a, 3b, 3c -- and 5 only;

     B. extended the Confirmation Objection Deadline to April 28,
        2003 at 4:00 p.m. for the Creditors entitled to vote
        in Class 5 only -- except Apollo, and Class 3a -- BMO
        Synthetic Lease Secured Claims;

     C. continued the hearing scheduled by the Court to consider
        confirmation of the Plan until May 7, 2003 at 10:30 a.m.
        Prevailing Eastern Time; and

     D. extended the deadline for parties-in-interest to file
        replies to confirmation objections to May 2, 2003.

                  Extending the Voting Deadline

Anthony W. Clark, Esq., at Skadden Arps Slate Meagher & Flom
LLP, in Wilmington, Delaware, relates that the Prepetition
Agent, the Creditors' Committee, Apollo and the Lead Members of
the Dissident Group reached an agreement regarding the
Modifications to the Plan that the parties believe will
facilitate voter approval and consensual confirmation of the
Modified Plan, thereby enabling the Debtors to emerge from
Chapter 11 in the near future and avoid the potential loss of
business, employees and value that would almost certainly result
from a protracted or litigated plan process.  Additionally,
separate negotiations between the Debtors and the Synthetic
Lessors resulted in, or will result in, agreements regarding
modifications to the Plan that resolve the Synthetic Lessors'
concerns regarding their treatment under the Plan.  The
Modifications relate primarily to redistributions of value
between creditors in Class 2 Prepetition Credit Facility Secured
Claims and Class 5 Senior Note Claims, and the form of the
value.  The Modifications enhance the treatment of Claims in
Classes 2 and 3 and negatively affect the treatment of Claims in
Class 5.  The Modifications do not materially affect the
treatment of Claims in any other Class.

           Extending the Confirmation Objection Deadline

The Confirmation Objection Deadline is also extended for
creditors in Class 5, other than Apollo and Class 3a BMO
Synthetic Lease Secured Claims.  According to Mr. Clark, the
Modified Plan is more favorable for creditors in Class 2 and,
thus, to the extent the creditors in Class 2 have not already
objected to the Plan, it would be unreasonable to let these
creditors now object to the more favorable Modified Plan.
However, because the Modified Plan is less favorable to
Creditors in Class 5, and because they are the only group that
may vote or change votes so as to reject the Modified Plan, the
creditors in Class 5 also should retain the ability to object to
confirmation of the Modified Plan.

The Modifications are the result of a heavily negotiated
agreement among the Debtors and these parties, who therefore
have no need to object to the Modified Plan.

Mr. Clark assures the Court that the brief extension of the
Confirmation Objection Deadline until April 28, 2003 at 4:00
p.m. solely for Class 5 creditors will not prejudice the rights
of any other creditors under the Plan or the Modified Plan.
Creditors in Classes 4, 6 and 7 have had ample opportunity to
consider and object to the Plan, and the Modifications do not
materially affect their interests.  Moreover, the Debtors have
not received any requests to extend either the Confirmation
Hearing, the Confirmation Objection Deadline or the Voting
Deadline from creditors in Classes 4, 6 and 7.

             Continuing the Confirmation Hearing

Mr. Clark tells the Court that the Debtors and their creditor
constituencies have determined that implementation of the
Modifications to the Plan is required in order to consensually
confirm a plan and enable the Debtors to emerge promptly from
Chapter 11.  This process will require a short delay of the
Confirmation Hearing.  Thus, the Confirmation Hearing will be
continued until May 7, 2003 at 10:30 a.m. in order to facilitate
voter approval and consensual confirmation of the Modified Plan.

The Debtors also believe that it is appropriate to extend the
Omnibus Reply Deadline until May 2, 2003 at 4:00 p.m. to
preserve the rights of parties-in-interest to respond to
objections to confirmation of the Modified Plan. (Hayes Lemmerz
Bankruptcy News, Issue No. 30; Bankruptcy Creditors' Service,
Inc., 609/392-0900)


HEADWAY CORPORATE: Year-End Net Loss Balloons to $98.5 Million
--------------------------------------------------------------
Headway Corporate Resources, Inc. is a provider of staffing
services to businesses in a variety of industries, including,
financial services, media, entertainment, biotechnology,
information technology and telecommunications.  Headway
established its human resource business through 20 acquisitions
of staffing and professional services companies from 1996
through 1999.  Headquartered in New York City, it operates
domestically from regional and local offices in, California,
Connecticut, Florida, New York, North Carolina, Virginia and,
until recently, Texas. Until recently, Headway was also a
provider of executive search  services to the financial services
through its Whitney subsidiaries. In March 2003, Headway exited
the executive search segment through a sale of the Whitney
subsidiaries so that it could focus on its core staffing
business.

In consideration for the sale, the Whitney Group (i) issued to
the Company a 15 percent membership interest in the Whitney
Group (subject to adjustment in certain circumstances), (ii)
issued a promissory note in the principal amount of $2,000,000,
and (iii) is obligated to pay an earnout equal to five percent
of Whitney Group's gross revenues, as defined, during a five-
year period commencing January 1, 2003.  The note bears interest
at the Prime Lending Rate as in effect from time to time, plus
two percent per annum. Interest is payable quarterly and the
full principal amount of the note is payable in January 2005.
The Whitney Group may, at its election, prepay and terminate the
promissory note and earnout obligation through a lump sum
payment of $5,000,000 less the actual amount of principal
previously paid on the promissory note and earnout payments.
The Whitney Group is obligated to prepay the promissory note and
earnout obligation on the foregoing terms if one or more
specified events occur prior to January 1, 2006, that constitute
a change in control or ownership of the Whitney Group. The
Company has estimated the fair market value of the promissory
note at $1,400,000 and the 15% equity interest at $45,000. This
transaction will be recorded in the 2003 financial statements
and is not expected to result in a material gain or loss on the
Company's results of operations.

Revenue decreased $55.2 million to $267.8 million for the year
ended December 31, 2002, from $323.0 million for the year ended
December 31, 2001. The decrease in revenue for 2002 is
attributable to the soft economy  and is consistent with the
performance of the other staffing and executive search companies
in the sector.  Many companies have instituted hiring freezes
for both temporary and permanent positions.  The financial
services industry reduced its demand for the Company's executive
search services as a direct result of the poor financial
performance across the financial services industry in 2002.

The Whitney executive search segment contributed $14.4 million
to consolidated revenues in 2002, a decrease of $11.7 million
from $26.1 million in 2001. This decrease reflects a sharp
decline in the demand for new hires in the financial services
industry.

The staffing subsidiary, Headway Corporate Staffing Services,
Inc. contributed revenues of $253.3 million, a decrease of $43.6
million from $296.9 million in 2001. The decline in revenues was
a result of negative impact of the unfavorable economic
conditions on the demand for information technology and
clerical staffing services.

Total operating expenses decreased $6.4 million to $315.3
million for 2002 from $321.7 million for 2001.  The decrease is
the result of a $33.5 million decrease in direct costs, a $13.0
million decrease in selling, general and administrative
expenses, a  $3.5 million decrease in depreciation and
amortization  offset by a $43.6 million impairment of goodwill
and long-lived assets. Direct costs increased as a percentage of
revenues to 82.1% in 2002 from 78.4% in 2001.  This increase in
direct costs as a percentage  of revenues is a result of a
change in Headway's business mix in 2002.  Specifically, the
executive search and permanent placement businesses that have no
direct costs experienced more significant declines than the
staffing business, therefore reducing its percentage of the
Company's total revenues.   Selling, general  and administrative
expenses decreased as a percentage of revenues from 19.4% in
2001 to 18.5% in 2002. The decrease in selling, general and
administrative expenses is primarily attributed to the lower
commission  expenses associated with the reduction in revenues,
as well as staff reductions and other cost-cutting initiatives
implemented in the latter half of 2001 in response to the
unfavorable economic conditions.  The decrease in depreciation
and amortization for 2002 as compared to 2001 is a result of the
adoption of  Statements of Financial Accounting Standards No.
142, "Goodwill and Other Intangible Assets" ("SFAS  142"),
effective January 1, 2002.  Under the new rules, goodwill and
intangible assets deemed to have indefinite  lives are no longer
amortized but are subject to annual impairment tests in
accordance with the Statement. Amortization of goodwill recorded
for 2001 was $4.0 million.  The impairment of goodwill and long-
lived assets of $43.6 million is a result of the deterioration
in the Company's results of operations.

The selling, general and administrative expenses for the
executive search segment decreased $5.9 million to $17.5 million
for the year ended December 31, 2002 as compared to $23.4
million for the same period last year.  The decrease relates
primarily to the reduced commissions related to the lower
executive search revenues.

HCSS' selling, general and administrative expenses decreased
$6.7 million to $30.3  million for the year ended December 31,
2002 as compared to $37.0 million for the same period last year.
The decrease in selling, general and administrative expenses is
primarily attributable to the lower commission expense
associated with the decline in revenues, as well as staff
reductions and other cost-cutting initiatives that were
implemented in the latter half 2001.

Interest expense increased $1.1 million to $12.0 million for the
year ended December 31, 2002 as compared to $10.9 million for
the same period last year. The increase in interest expense is
due to increased  amortization of deferred financing costs
relating to the amendments completed in April 2002 and August
2001, and an increase in the applicable margin for base rate
loans under the Amended Senior Credit Facility.

As a result of the foregoing factors, Headway had a net loss of
$98.5 million for the year ended December  31, 2002 compared to
a net loss of $5.7 million for the year ended December 31, 2001.

As of Dec. 31, 2002, the company reported a total shareholders'
equity deficit of about $73 million. Working capital deficit
tops $49 million.


HIGHWOODS PROPERTIES: Declares Cash Preferred Share Dividend
------------------------------------------------------------
Highwoods Properties, Inc. (NYSE: HIW), the largest owner and
operator of suburban office properties in the Southeast,
reported funds from operations before minority interest of $40.8
million for the quarter ended March 31, 2003. This compares to
FFO of $55.6 million for the same period a year ago. The Company
has lowered its FFO guidance for the full year to between $2.60
and $2.70 per share.

Net income available for common stockholders totaled $3.5
million for the quarter ended March 31, 2003 compared to $19.2
million for the same period last year.

Highwoods also announced that its Board of Directors has reduced
its annual dividend rate to $1.70 per share. At Highwoods'
closing price on April 24, 2003, this dividend provides an
annual yield of approximately 8.0%.

The Board of Directors also increased the share repurchase
authorization by an additional 2.5 million shares. As a result,
the Company may now repurchase up to 5.9 million shares of its
outstanding common shares and operating partnership units
through open market or privately negotiated transactions.

Ronald P. Gibson, president and chief executive officer of
Highwoods said, "The entire office REIT industry continues to be
impacted by deteriorating macroeconomic trends including slow
GDP growth, rising unemployment and continuing uncertainty in
the corporate sector, which has stymied most firms' expansion
plans. Highwoods has been particularly hard hit with the
bankruptcies of WorldCom and US Airways, which effectively
eliminated $18.0 million of annual revenue and reduced our
occupancy by 2.2%. Some of the signs that appeared in the fourth
quarter, indicating that a number of our markets had begun to
stabilize, evaporated and were replaced with more indications of
instability and economic weakness.

Our Board of Directors, when faced with declining occupancy,
deteriorating macroeconomic trends and the likely prospects of
having to fund a shortfall through 2004 and perhaps part of
2005, believed that lowering the dividend was the most prudent
course of action to ensure the financial health and long-term
growth of the Company. This reduction in our dividend will
enhance our financial flexibility and better position us to take
advantage of acquisition and development opportunities when this
market finally does turn around."

First Quarter Highlights

-- Highwoods' 37.2 million-square foot in-service portfolio was
    83.2% occupied at March 31, 2003. This represents a 480 basis
    point decline from a year ago and an 80 basis point decline
    from the fourth quarter of 2002.

-- Rental revenues from continuing operations for the first
    quarter were $109.0 million, a 6.2% decline from the first
    quarter of 2002 when rental revenues from continuing
    operations were $116.2 million.

-- Same property rental revenues for the first quarter declined
    6.3% from a year ago to $105.3 million and cash basis same
    property net operating income declined 11.1% for the
    comparable period.

-- Same property average occupancy for the quarter ended
    March 31, 2003 declined to 84.8% from 89.5% a year ago.

-- Cash available for distribution ("CAD") was $29.1 million for
    the first quarter of 2003 versus CAD of $46.8 million for the
    first quarter of 2002.

-- Leasing activity in Highwoods' office, industrial and retail
    portfolio during the first quarter totaled 2.0 million square
    feet. 55.0% of this leasing activity was in the Company's
    office portfolio, which reported an average first-year cash
    rental rate 7.5% lower than the average final rental rate
    under the previous leases. On a straight-line basis, rents
    for office leases increased 2.7% over the straight-line rents
    for expiring leases.

-- In the first quarter of 2003, the Company repurchased 126,261
    common partnership units at a weighted average price of
    $21.71 per unit. Since commencement of its initial share
    repurchase program in December 1999, Highwoods has
    repurchased 11.6 million shares of common stock and Highwoods
    Realty Limited Partnership common partnership units at a
    weighted-average price of $24.19 per share/unit for a total
    purchase price of $280.7 million. Inclusive of the recent
    authorization of 2.5 million shares, the Company has 5.9
    million shares/units remaining under its authorized
    share/unit repurchase program.

                     Asset Repositioning

Sales

In the first quarter, the Company sold a total of 6.65 acres of
land for a gain of $863,000. In addition, the Company sold non-
core assets in Kansas City for total proceeds of $305,000.

For 2003, the Company anticipates disposition activity to be
between $75.0 and $175.0 million. The Company currently has
assets under letter of intent or contract for sale of $135.9
million.

Acquisitions

A 66,421 square foot building that was 94.8% occupied was
purchased in Richmond for $7.0 million. The Company also
purchased 23.46 acres of land in Atlanta for $2.25 million. This
land is part of the Bluegrass Valley office development project.

Development

Highwoods' development pipeline consists of three projects
totaling 200,000 square feet that were 36.0% pre-leased at the
end of the quarter. The anticipated total investment of these
projects is $19.0 million, with $16.2 million funded as of March
31, 2003.

One development project was placed in service in the first
quarter, Seven Springs, a 131,000-square foot office building in
Nashville that was 14% occupied and 76% pre-leased.

                 Quarterly Dividend Declared

The Board of Directors declared a cash dividend of $0.425 per
share of common stock for the first quarter ended March 31,
2003, which equates to an annual dividend of $1.70 per share,
and is payable on May 20, 2003, to shareholders of record as of
May 7, 2003.

The Board also declared a cash dividend of $21.5625 per share of
Highwoods Properties Series A Cumulative Redeemable Preferred
Stock. The dividend is payable on June 2, 2003, to shareholders
of record as of May 15, 2003.

The Board also declared a cash dividend of $0.50 per share of
Highwoods Properties Series B Cumulative Redeemable Preferred
Stock. The dividend is payable on June 16, 2003, to shareholders
of record as of June 2, 2003.

Additionally, the Board declared a cash dividend of $0.50 per
Depositary Share each representing 1/10 of an 8 percent Series D
Cumulative Redeemable Preferred Share. The dividend is payable
on July 31, 2003, to shareholders of record as of July 1, 2003.

                          Outlook

For the year ending December 31, 2003, Highwoods is estimating
FFO to be between $2.60 to $2.70 per share. This estimate
assumes an average occupancy of 82% to 84% on the portfolio.

Highwoods Properties, Inc., whose preferred share rating is
affirmed by Standard & Poor's at BB+, is a fully integrated,
self-administered real estate investment trust that provides
leasing, management, development, construction and other
customer-related services for its properties and for third
parties. The Company currently owns or has an interest in 589
office, industrial, retail and service center properties
encompassing approximately 46.9 million square feet, including 9
development projects encompassing approximately 1.1 million
square feet. Highwoods also owns approximately 1,250 acres of
development land. Highwoods is based in Raleigh, North Carolina,
and its properties and development land are located in Florida,
Georgia, Iowa, Kansas, Missouri, North Carolina, South Carolina,
Tennessee and Virginia. For more information about Highwoods
Properties, please visit the Company's Web site at
http://www.highwoods.com


INVESCO CBO: S&P Places Low-B Level Class B-2 Rating on Watch
-------------------------------------------------------------
Standard & Poor's Ratings Services placed its rating on the
class B-2 notes issued by Invesco CBO 2000-1 Ltd., managed by
Invesco Inc. on CreditWatch with negative implications. At the
same time, the ratings on the class A-1L, A-2L, A-3, and B-1L
notes are affirmed.

The CreditWatch placement on the class B-2 notes reflects
several factors that have negatively affected the credit
enhancement available to support the notes. These factors
include par erosion of the collateral pool securing the rated
notes and a downward migration in the credit quality of the
assets within the pool.

The affirmations reflect the sufficient level of credit
enhancement currently available to support the rated tranches.

The overcollateralization test ratios for Invesco have
deteriorated significantly since the transaction's effective
date in February 2001. As of the April 2, 2003 monthly trustee
report, the class A overcollateralization ratio was 121.90% (the
minimum required ratio is 118.00%), versus an effective date
ratio of 128.20%. The class B-1L
overcollateralization ratio was 108.70% (the minimum required
ratio is 109.00%), versus an effective date ratio of 114.00%.
The class B-2 overcollateralization ratio was 103.90% (the
minimum required ratio is 103.00%), versus an effective date
ratio of 109.90%.

Standard & Poor's notes that the Trading Model test, a measure
of the ability of the credit quality in the portfolio to support
the rating on a given tranche, is out of compliance according to
the April trustee report.

Standard & Poor's will be reviewing the results of current cash
flow runs generated for Invesco 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. The results
of these cash flow runs will be compared with the projected
default performance of the performing assets in the collateral
pool to determine whether the ratings assigned to the above
mentioned notes remain consistent with the credit enhancement
available.

           RATING PLACED ON CREDITWATCH NEGATIVE

                   Invesco CBO 2000-1 Ltd.

         Class             Rating
                     To               From     Balance (mil. $)
         B-2         BB-/Watch Neg.   BB-                 8.00

                      RATINGS AFFIRMED

                   Invesco CBO 2000-1 Ltd.

                           Balance (mil. $)
         Class   Rating    Current   Orig.
         A-1L    AAA       59.00     59.00
         A-2L    AAA       78.00     78.00
         A-3     AAA       26.00     26.00
         B-1L    BBB-      19.50     19.50


IMC GLOBAL INC: Red Ink Flows in First Quarter 2003
---------------------------------------------------
IMC Global Inc. (NYSE: IGL) reported a loss before the
cumulative effect of a change in accounting principle of $31.7
million for the first quarter ended March 31, 2003, which
included a non-cash loss from the unfavorable impact of the
strengthening Canadian dollar on IMC Potash's U.S. dollar
denominated receivables of $21.9 million ($14.9 million after
tax).  Excluding this foreign currency impact, the Company
reported a loss before the cumulative effect of a change in
accounting principle of $16.8 million.

In the first quarter of 2002, the Company recorded net earnings
of $4.8 million.

This year's first quarter results also included a restructuring
charge of $3.4 million, $2.0 million after minority interest and
taxes for severance costs associated with the Company's
previously announced organizational restructuring program
implemented in March, and an unfavorable impact of $5.3 million,
$2.8 million after tax and minority interest for the shutdown of
the Fort Green rock mine in February and March to reduce
inventory levels and generate cash, partially offset by a net
curtailment gain of $2.6 million, $1.8 million after tax and
minority interest recorded as a result of pension and retiree
medical plan design changes.

Including a non-cash charge of $4.9 million for the cumulative
effect of a change in accounting principle from the adoption of
SFAS No. 143 on January 1, 2003, the Company recorded a net loss
of $36.6 million.  SFAS No. 143 requires legal obligations
associated with the retirement of long-lived assets to be
recognized at their fair value at the time that the obligations
are incurred.

2003 first quarter results were impacted by greatly increased
ammonia, natural gas and sulphur raw material costs, higher
concentrate plant operating costs primarily due to turnarounds,
and the aforementioned rock mine shutdown, partially offset by
higher phosphate prices. Ammonia and sulphur costs increased 82
percent and 64 percent, respectively, versus the prior year,
while average diammonium phosphate (DAP) realizations increased
$9 per short ton, or 7 percent. Phosphate market pricing began
to significantly strengthen in the latter part of the first
quarter, but the impact will not be more fully realized until
the second quarter.

Net sales in the first quarter of 2003 increased 11 percent to
$552.1 million due to higher phosphate and potash shipments, and
increased phosphate prices.

EBITDA for the first quarter of $55.5 million compared with
$90.4 million a year ago. First quarter capital expenditures
declined 25 percent to $23.7 million (or $19.9 million after
minority interest) and selling, general and administrative
expenses decreased 6 percent to $18.3 million, reflecting a
portion of the benefit plan changes. Depreciation, depletion and
amortization expenses were $41.1 million, unchanged from the
prior year.

IMC PhosFeed

IMC PhosFeed's first quarter net sales of $359.0 million
increased 15 percent compared with $312.7 million last year as a
result of higher phosphate prices and shipments. The average
price realization for DAP of $143 per short ton in the first
quarter of 2003 increased $9 versus the prior year and $10
compared to the fourth quarter of 2002. Domestic and export DAP
realizations rose 6 and 8 percent, respectively. Total
concentrated phosphate shipments of 1.6 million short tons were
9 percent higher than the prior-year level of 1.5 million short
tons due to a 16 percent improvement in export shipments,
primarily to Asia and Australia.

First quarter gross margin losses of $14.8 million declined from
gross margins of $18.0 million a year ago due to greatly
increased ammonia and sulphur raw material costs, higher
concentrate plant operating costs primarily due to turnarounds,
and the planned idling of a Florida rock mine in February and
March to reduce inventory levels and improve cash flow,
partially offset by the higher phosphate pricing.

Approximately 30 percent of IMC's Louisiana concentrated
phosphate output continued to be idled to balance supply and
current market demand, an operating rate projected to be
maintained throughout 2003.

IMC Potash

IMC Potash's first quarter net sales improved 4 percent to
$214.2 million versus last year's $205.2 million as higher
export shipments more than offset slightly reduced selling
prices. Total shipments of nearly 2.2 million short tons
increased 7 percent versus 2.0 million a year ago. Export
volumes improved 23 percent due primarily to the timing of
Chinese shipments; the Company's increased Canpotex sales
allocation of 1.7 percent to 36.67 percent, retroactive to
July 1, 2002; and strong Brazilian demand. Domestic shipments
were essentially unchanged as the Company attempted to achieve a
first quarter price increase. The average selling price,
including all potash products, was $74 per short ton compared to
last year's $75 per short ton. Approximately $4 per short ton of
the February and March domestic muriate of potash (MOP) price
increases is expected to be achieved in the second quarter based
upon a trend of improving realizations as the first quarter
ended.

First quarter gross margins of $55.4 million were slightly
improved versus $54.6 million in the prior year. Improved sales
volumes were offset by slightly lower prices and higher
production costs, the largest factor of which was natural gas
costs.

Observations and Outlook

"Our first quarter results, while disappointing, were consistent
with our mid-March guidance as well as earlier comments that we
would have a challenging start to 2003 after a tough fourth
quarter in 2002," said Douglas A. Pertz, Chairman and Chief
Executive Officer of IMC Global. "While DAP market pricing
recovered dramatically in the latter part of the first quarter,
our realized pricing was not sufficient to offset much higher
costs for ammonia and natural gas, as well as increased sulphur
costs, which negatively impacted phosphate margins. Our results
also were negatively impacted by about 5 cents per share from
the combination of the planned idling of a Florida rock mine and
a one-time charge for severance costs for our March
organizational restructuring that eliminated approximately 100
positions but will result in annualized savings of about $10
million, partially offset by gain of 2 cents per share from
changes to our pension and retiree medical plans. However,
savings after minority interest and taxes from the
organizational restructuring program, net of the charge, should
be $4.1 million, or 4 cents per share this year and 5 cents in
2004 and beyond.

"The raw material cost spike should not mask the encouraging and
rapid gains in DAP pricing in the first quarter, which are
holding to date in the second quarter, in large part due to a
very tight supply-and-demand situation and low producer
inventories," Pertz emphasized. Now at its highest level since
May 1999, or just at the start of the global industry downturn,
the current Tampa DAP export spot price of nearly $190 per
metric ton compares to a 2002 year-end low of $149, confirming
that the sudden and sharp 2002 fourth quarter price drop was an
overreaction and due to several unusual events. In addition, the
current comparable Central Florida domestic DAP spot price of
$175 per short ton is at its highest level since late 1998.

"Since early March, and as we indicated at that time, we have
started to see higher DAP pricing outstrip increased raw
material costs, which is continuing so far in the second
quarter," Pertz said. "Ammonia and natural gas raw material
costs appeared to peak in early March and began a downward
trend. For example, our second half April ammonia contract cost
of $235 per metric ton is about $35 per ton below early March
levels. Also, most of the $8 per long ton increase we will incur
in second quarter sulphur raw material costs was anticipated in
our prior outlook.

"Given the continued tightness in DAP supply-and-demand and a
good start to the U.S. spring planting season, we believe a
significant portion of the large gains in DAP pricing can be
maintained even as we expect further abatement of ammonia and
natural gas costs," Pertz said. Historical patterns suggest that
improving phosphate fundamentals, such as those now under way,
are tied much more closely to firming supply-and-demand rather
than the relative level of raw material input costs.

Pertz added that IMC Potash is poised for another solid
performance in 2003 with higher sales volumes, as evidenced by
the first quarter increase of 7 percent, and prospects for
improved domestic realizations stemming from price increases
announced in February and March.

"The pace of the U.S. spring planting season is accelerating,
spurred by favorable weather conditions and overall positive
grain fundamentals, including higher crop prices," Pertz noted.
"Good phosphate and potash movement should develop well into
May, and we continue to believe that domestic fertilizer demand
should improve as much as 2 to 3 percent over last year.

"All in all, we remain encouraged by these positive market
developments," Pertz said. "However, we're disappointed by the
level of current raw material costs, specifically ammonia and
natural gas, which have not eased as much as previously
anticipated. As a result, we now believe that our second quarter
earnings per share from continuing operations could be in the
range of 10 to 15 cents, which includes an after-tax gain of 6
cents per share from the pending sale of our Port Sutton marine
terminal, slightly offset by the final month of shutdown in
April of our Fort Green rock mine for inventory reduction. This
outlook is subject to a number of factors, including the
strength of the spring planting season, phosphate pricing trends
and moderating raw material costs."

Pointing to a multi-year recovery in progress, Pertz reiterated
fertilizer industry consultants' forecasts that global phosphate
fundamentals should improve further in 2003 versus 2002 from a
continued tightening of supply and demand, low industry
inventory levels, increased operating rates, and the absence of
any significant new capacity. Trends to date suggest that the
full-year average Tampa DAP export spot price could be markedly
better than consultants' earlier projections of about $168 per
metric ton, up from $158 in 2002.

The Company is maintaining a relentless focus on its number-one
priority to be the industry's low-cost producer through two
major cost-savings programs in 2003. An organizational
restructuring program implemented in March eliminated
approximately 100 positions Company-wide and will generate pre-
minority interest, pre-tax savings of approximately $10 million
annually, or 5 cents per share. A second initiative, Operational
Excellence, remains on track to meet a targeted pre-minority
interest, pre-tax savings rate of at least $70 million annually
by mid-2005, including as much as $15 million by the end of
2003. Operational Excellence is a broad-based, re-engineering
effort that should result in increased efficiency, reduced costs
and revenue enhancements through core business process redesign
and maximization. The Company's expanding continuous improvement
system, anchored by growing Six Sigma activities, should deliver
in excess of $8 million of savings in 2003 through more than 60
projects.

With 2002 revenues of $2.1 billion, IMC Global is the world's
largest producer and marketer of concentrated phosphates and
potash crop nutrients for the agricultural industry and a
leading global provider of feed ingredients for the animal
nutrition industry. For more information, visit IMC Global's Web
site at http://www.imcglobal.com

As previously reported, Fitch Ratings assigned a 'BB' rating to
IMC Global Inc.'s new 11.25% senior unsecured notes due June 1,
2011. Fitch has affirmed the 'BB+' rating on the senior secured
credit facility, the 'BB' rating on the existing senior
unsecured notes with subsidiary guarantees and the 'B+' rating
on the senior unsecured notes with no subsidiary guarantees. The
Rating Outlook has been changed to Negative from Stable.


INTERNATIONAL PAPER: Reports Improved 1st Quarter 2003 Earnings
---------------------------------------------------------------
International Paper (NYSE: IP) reported first-quarter 2003 net
earnings of $44 million, compared with a net loss of $1.11
billion in the first quarter of 2002 and a net loss of $130
million in the fourth quarter of 2002.  Amounts in all periods
include the effects of special items, with the first-quarter
amounts in both years also reflecting a cumulative effect of an
accounting change.

Before the cumulative effects of accounting changes and special
items, earnings for the first quarter of 2003 were $68 million,
compared with $58 million in the 2002 first quarter and $160
million in the fourth quarter of 2002.

First-quarter 2003 net sales totaled $6.1 billion, compared with
$6.0 billion in the first quarter of 2002 and $6.3 billion in
the fourth quarter of 2002.

"Despite adverse weather, higher energy costs and a sluggish
world economy, I'm encouraged by our ability to achieve higher
year-over-year operating earnings," said John Dillon,
International Paper chairman and chief executive officer. "While
we're still nowhere near where we want to be, our strong focus
on internal improvements and customer service continues to
positively impact our results."

Special Items and the Cumulative Effects of Accounting Changes

Special items in the 2003 first quarter included a net charge of
$23 million before taxes and minority interest ($14 million
after taxes and minority interest or $0.03 per share) for
certain costs related to the shutdown of the Natchez, Missouri,
dissolving pulp mill, and other charges for organizational
realignments and related severance. Also in the quarter, the
company adopted Statement of Financial Accounting Standards
(SFAS) No. 143, "Accounting for Asset Retirement Obligations",
resulting in a $10 million after-tax charge ($0.02 per share)
for the cumulative effect of a change in accounting.

Special items in the first quarter of 2002 consisted of a $10
million pre-tax credit ($7 million after taxes) for the reversal
of reserves no longer required. In addition, the company also
recorded a cumulative effect of an accounting change of $1.2
billion in the 2002 first quarter for the transitional goodwill
impairment charge from the adoption of SFAS No. 142, "Goodwill
and Other Intangible Assets".

Special items in the fourth quarter of 2002 consisted of a pre-
tax charge of $101 million ($71 million after taxes and minority
interest) for facility closures, administrative realignment
severance costs, and cost reduction actions, a pre-tax charge of
$450 million ($278 million after taxes) for additions to
existing exterior siding legal reserves, a pre-tax charge of $46
million ($27 million after taxes and minority interest) for
early debt retirement costs, a pre-tax credit of $58 million
($36 million after taxes) for the reversal of restructuring and
realignment reserves no longer required, a pre-tax credit of $10
million ($4 million after taxes) to adjust accrued costs of
businesses sold, and a $46 million credit for an adjustment of
deferred state income tax reserves.

A reconciliation of earnings before special items to net
earnings (loss), including information regarding the cumulative
effect of accounting changes and special items, is presented in
a table in this press release.

Segment Information

Compared with the first quarter of 2002, operating profits were
up slightly as higher energy costs and extreme weather
conditions that affected fiber costs were offset by volume and
pricing gains.

First-quarter 2003 segment operating profits and business trends
compared with the fourth quarter of 2002 were as follows.

First-quarter operating profits for Printing Papers were $122
million compared with fourth-quarter 2002 operating profits of
$157 million due to higher energy and fiber costs as well as
weather-related operating problems at U.S. mills.

Industrial and Consumer Packaging operating profits were $89
million in the first quarter, compared with $116 million in the
2002 fourth quarter as higher Industrial Packaging volumes were
offset by seasonally weaker demand in Consumer Packaging as well
as higher energy and fiber costs.

The company's distribution business, xpedx, reported operating
profits of $15 million for the first quarter of 2003 compared
with operating profits in the fourth quarter of 2002 of $28
million, due to seasonally lower sales and higher energy costs
that impacted warehousing and delivery costs.

First-quarter Forest Products operating profits of $161 million
were up slightly from $156 million in the fourth quarter of 2002
as slightly improved lumber and plywood results offset lower
harvest volumes and lower gains from land sales.

Operating profits at Carter Holt Harvey, International Paper's
50.5 percent owned subsidiary in New Zealand, were $16 million
in the first quarter of 2003, flat with fourth-quarter 2002
operating profits amid improved paper and pulp results offset by
lower results in forests and wood products.

Corporate items, net, were $88 million for the 2003 first
quarter, slightly lower than $94 million in the first quarter of
2002, but higher than in the fourth quarter of 2002 due to an
increase in pension expense and higher supply chain initiative
costs, somewhat offset by lower benefit costs. Fourth- quarter
expenses were also lower due to proceeds from the sale of shares
received from an insurance company demutualization.

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) (SFI(R)) 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.


I-STAT CORP: March 31 Balance Sheet Insolvency Tops $31 Million
---------------------------------------------------------------
i-STAT Corporation (Nasdaq: STAT), the leading manufacturer of
point-of-care diagnostic systems for blood analysis, announced
its consolidated financial results for the first quarter of
2003.

                          Quarter Results

For the three months ended March 31, 2003, i-STAT's consolidated
net revenues were approximately $15.4 million, up from $14.4
million for the quarter ended March 31, 2002. Gross margin on
total net revenues for the first quarter of 2003 was
approximately $3.9 million, up 136.2% from $1.7 million in the
first quarter of 2002. The net loss for the first quarter of
2003 was approximately $0.6 million, down from a net loss of
$3.8 million for the first quarter of 2002. The net loss to
common stockholders for the quarter was approximately $1.1
million or $0.05 per share, after Preferred Stock dividends of
approximately $0.4 million and accretion of Preferred Stock of
approximately $0.1 million, as compared with a net loss to
common stockholders for the quarter ended March 31, 2002 of $4.4
million or $0.22 per share, after Preferred Stock dividends of
approximately $0.5 million and accretion of Preferred Stock of
approximately $0.1 million.

These consolidated results include cartridge sales of
approximately $11.2 million and analyzer sales of approximately
$2.4 million for the first quarter of 2003, compared with $9.3
million generated from cartridge sales and $2.9 million in
analyzer sales for the three months ended March 31, 2002.
Approximately 3.5 million cartridges were sold in the first
quarter of 2003, up 28.6% from shipments in the first quarter of
2002 of approximately 2.7 million units and up 5.6% from
shipments of 3.3 million units in the fourth quarter of 2002.

Other income during the quarter ending March 31, 2003 included
approximately $1.4 million in currency exchange gains related to
short-term, intercompany debt owed by the Company's Canadian
manufacturing subsidiary.

As of March 31, 2003, i-STAT had approximately $28.0 million in
cash and cash equivalents and total marketable securities, up
from $27.1 million at December 31, 2002.

Analyzer sales for the first quarter of 2003 totaled 936 units,
down 20.3% from the 1,175 units shipped in the first quarter of
2002. Analyzer sales were high early in 2002 due to a
significant program conducted by Abbott Laboratories to upgrade
existing customers to the newer i-STAT(R) 1 analyzer, a unit
that incorporates the ability to read Medisense(R) glucose
strips marketed by Abbott. This program met with early success
and the demand for such upgrades has largely been met.

At March 31, 2003, I-STAT Corp.'s balance sheet shows a total
shareholders' equity deficit of about $31 million.

                     Additions to Management

The Company continues to take actions to broaden and strengthen
its management team in preparation for resumption of direct
product distribution in 2004. In March, David Phillips joined
the Company as Director of Marketing with a significant and
distinguished record of leadership in developing the point of
care market with Roche Diagnostics. In April 2003, Steven Parker
joined the Company as General Manager, heading up the Company's
program to directly market product in Europe.

                         Corporate Update

Actions to prepare for the transition to direct product
distribution that began early in 2002 continue, with staffing of
the sales specialist portion of the Company's sales force
focused on existing customers and the introduction of new
products. The other Company sales force, its sales consultant
group largely hired in 2002, is fully active and in the field,
with the objective of assuring broad adoption of the concept of
point-of-care blood testing (POCT) by the clinical, management
and laboratory leaders. Continued adoption by hospitals not
currently using POCT remains critical to reestablishing the
aggressive rates of sales growth. Most of these sales consultant
positions have now been filled for approximately one year and
these personnel are becoming increasingly established in their
territories and skilled in managing this complex, consultative
sale. Both teams will be fully trained and operational by
January 2004.

The i-STAT System and POCT have been promoted through the
marketing efforts of Abbott during the term of its agreement
with the Company, along with Abbott's many other diagnostic
products, most of which address the needs of the hospital
central clinical laboratory. This year, the Company is launching
an intensive marketing program, focused solely on accelerating
the adoption of POCT and the i-STAT System. This program is
being led by David Phillips and has already resulted in
independent attendance by i-STAT at the recent American College
of Cardiology meeting in Chicago, the first such activity by the
Company in five years. Increased direct clinician contact at
meetings, symposia and conventions will continue along with
journal articles, direct mail, telemarketing, user groups,
product positioning studies and other interventions to
aggressively bring the value of the i-STAT System to clinicians
and administrators in target hospitals.

While POCT, with its inherently faster therapeutic turnaround
time is broadly assumed and anecdotally reported to be of
significant value in securing superior patient clinical
outcomes, little exists in the literature to support these
reports. In 2002, the Company initiated work on five prospective
outcome studies to document the clinical value of rapid,
accurate blood test results at the point of patient care.

These studies are investigating such outcomes as:

* reduction in the need for blood replacement with lower test
   volumes;

* reduction in ventilator time;

* reduction in ICU length of stay with rapid monitoring of blood
   gases;

* reduction in morbidity and mortality with trauma patients.

It is anticipated that these studies will result in peer-
reviewed publications available to the clinical community. One
of these studies is expected to conclude later this year as
protocols developed for the other four initial studies are
completed and work on those studies begins. The studies are
being conducted at major research hospitals including Stanford
University Medical Center in Palo Alto, CA; Sentara Norfolk
General in Norfolk, VA; Cedars-Sinai Medical Center in Los
Angles, CA; and Harris Methodist Medical Center in Fort Worth,
TX.

                        New Product Programs

Prothrombin Time (PT) -- In 2002, i-STAT received Food and Drug
Administration clearance to market its prothrombin time test
used to monitor patients on anti-coagulant therapy, such as
COUMADIN(R), to prevent blood clot formation. Commercial
distribution of an easy to use "finger stick" version of this
product began in March 2003. Testing frequency for these
otherwise well, ambulatory patients has been positively
correlated with improved long-term clinical results, making
ease-of-use a critical point of product differentiation. Short-
term evaluations of the product are underway at selected high-
volume hospital and clinic sites throughout the U.S. Commercial
production has begun to support anticipated demand as
evaluations convert to routine clinical usage.

Troponin I -- This cardiac marker, the Company's first
immunoassay test, is specified in new guidelines published by
the American College of Cardiology (ACC) and the European
Society of Cardiology (ESC) which stress the need to obtain
rapid test results to speed diagnosis and therapeutic
intervention for patients who may have suffered cardiac injury.

Clinical trials to collect data in support of the filing of a
510(k) Notification with the FDA began in December 2002 at
Hennepin County Medical Center in Minneapolis (a University of
Minnesota affiliate) and have continued at Washington University
in St. Louis, MO and at the University of Maryland in Baltimore,
MD. These trials demonstrated sensitivity equivalent to that
available from central laboratory testing systems while
providing the clinician with a reading of the patient's Troponin
I level in approximately 10 minutes, compared to the 30-60
minute response time provided by the best central labs.

A paper prepared by Dr. Frederick Apple, lead investigator for
the Hennepin County Medical Center trial, has been accepted for
oral presentation to the Society of Chest Pain Clinics and
Providers Conference in May 2003. This and other data to support
the filing of a 510(k) Notification, seeking permission to
market this Troponin I test, has been collected and the filing
is anticipated later this spring. Subject to FDA approval,
launch of this product is anticipated in the second-half of this
year.

Kaolin Activated Clotting Time (ACT) -- Discussions with the FDA
regarding the 510(k) Notification seeking permission to market
our kaolin ACT coagulation test continue. This coagulation test
is the companion test to the Celite(R) ACT coagulation test
already being marketed by the Company. It is critical that
patients undergoing invasive cardiac procedures have the
coagulation characteristics of their blood monitored constantly.
Clinicians select either the Celite ACT or the kaolin ACT test,
based upon the specific drug therapy being used. The Company
believes that the ability to market both of these tests will
increase the utility of the i-STAT System in cardiovascular
operating rooms.

i-STAT Corporation develops, manufactures and markets diagnostic
products for blood analysis that provide health care
professionals critical diagnostic information accurately and
immediately at the point of patient care. Through the use of
advanced semiconductor manufacturing technology, established
principles of electrochemistry and state-of-the-art computer
electronics, i-STAT developed the world's first hand-held
automated blood analyzer capable of performing a panel of
commonly ordered blood tests on two or three drops of blood in
just two minutes at the patient's side.


JAFRA COSMETICS: Senior Notes & Bank Loan Rated at B-/B+ by S&P
---------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B-'
subordinated debt rating to Jafra Cosmetics International Inc.'s
proposed $175 million senior subordinated notes due 2011. At the
same time, a 'B+' senior secured rating was assigned to Jafra's
proposed $100 million bank facility, and a 'B+' corporate credit
rating was assigned to Mexican affiliate Distribuidora Comercial
Jafra S.A. de C.V..

Both Jafra and DCJ are obligors on the subordinated notes and
the bank facility. The ratings will be effective upon closing of
the facility and are subject to Standard & Poor's review of the
final documentation. The current 'B+' corporate credit rating on
Jafra Cosmetics International S.A de C.V., an obligor under the
existing credit facilities and a several obligor on the notes,
will be withdrawn upon closing of the new credit facilities.

The proposed issuance of the notes and the new credit facility
are part of Jafra's recently announced $275 million
recapitalization plan. Proceeds will be used principally to
repay outstanding amounts under Jafra's current credit facility,
redeem existing notes due 2008, as well as make a distribution
to equity holders in the holding company, CDRJ Investments
S.A. These equity holders include Clayton, Dubilier & Rice Fund
V, which owns approximately 84% of CDRJ Investments' outstanding
shares. Upon completion of the recapitalization, Standard &
Poor's will withdraw its rating on the existing $90 million
credit facility due 2004.

The outlook is stable.

Total debt outstanding at Dec. 31, 2002, was about $84.4
million.

Jafra's proposed $100 million bank facility is rated the same as
the corporate credit rating. The bank facility consists of a $60
million amortizing term loan and a $40 million revolving credit
facility. Both are allocated on a pro rata basis, 40% available
for Jafra and 60% available for DCJ. The facilities include a
maximum total debt to EBITDA ratio, a minimum EBITDA to interest
ratio, and a limit on annual capital expenditures.

The outlook revision reflects the incremental debt resulting
from the recapitalization, and the expectation that related
credit measures will weaken somewhat due to the additional debt
service. In line with expectations, Jafra reported sales and
operating profit growth for full-year 2002. Given the risks
associated with the direct-selling business and the highly
competitive cosmetics industry, Jafra's credit measures need to
be stronger than the median to support the ratings.

"Ratings on Jafra reflect the industry risk of direct-sales
distribution, the highly competitive cosmetics business, and
exposure to foreign exchange risk," said Standard & Poor's
credit analyst Susan Ding. "These factors are partially offset
by Jafra's solid position in certain niche markets of the
cosmetics industry."

Jafra, a manufacturer of cosmetics and beauty care products, is
a small competitor in both the cosmetics industry and the
direct-sales industry, with sales concentrations in Mexico
(which represented 66% of 2001 revenues), the U.S. (21%), and
Europe (8%).


LEAP WIRELESS: Court Allows Interim Compensation of Insiders
------------------------------------------------------------
Michael S. Lurey, at Latham & Watkins, in Los Angeles,
California, tells the Court that Leap Wireless International
Inc. and its debtor-affiliates' directors and senior executive
officers are critical to the Debtors' operations and a
successful reorganization.  The Insiders have the transactional,
operational and financial knowledge that is necessary to operate
the Debtors' business and to maintain stability during their
Chapter 11 cases.  Each element of the Debtors' business, from
the infrastructure of their telecommunications networks to the
confidence of the employees to the continued loyalty of their
customers, depends on the Insiders' direction and abilities.
Failure to compensate the Insiders in the ordinary course of
business may risk the departure of one or more of the Insiders
and thereby materially disrupt the Debtors' operations.

Mr. Lurey relates that the Debtors intend to confirm a plan of
reorganization expeditiously, resulting in swift and focused
Chapter 11 cases.  To this end, the Debtors heavily negotiated
with respect to the terms of their restructure with the Informal
Noteholder Committee and the Informal Vendor Debt Committee
prior to the Petition Date and have filed a large number of
motions for "first day" relief.  The Debtors intend to maintain
operations during the bankruptcy process in as similar a manner
to prepetition operations as possible and to quickly reorganize
with minimal disruption.  The Insiders are crucial to a smooth
transition over this short time frame.

The Debtors are working closely with the Informal Vendor Debt
Committee and the Informal Noteholder Committee and are close to
finalizing the terms of the Plan.  Moreover, the Informal Vendor
Debt Committee has consented to the current Compensation of
Senior Management.  In the Debtors' business judgment, the
Compensation provided to the Insiders prepetition and to be
continued postpetition is both reasonable and consistent with
compensation paid to the management of similar sized public
companies.

Mr. Lurey further believes that requiring the Debtors and
Insiders to submit declarations and operating reports to comply
with Rule 4002-2 of the Local Rules of Bankruptcy Procedure
would distract the Debtors from the task of reorganization and
distract the Insiders from maintaining normal operations.
Moreover, the reporting requirements of Local Rule 4002-2 are
not necessary given that the Informal Vendor Debt Committee
consented to Senior Management's Compensation.  Thus, there is
ample justification for the Court to authorize the payment of
interim Compensation to the Insiders and the waiver of the
reporting requirements of Bankruptcy Local Rule 4002-2.

Accordingly, the Debtors sought and obtained the Court's
permission to pay interim compensation of certain Insiders and
waiver of the requirement under Bankruptcy Local Rule 4002-2(b)
for a personal income and expense declaration from each Insider
and the requirement to submit monthly operating reports.
(Leap Wireless Bankruptcy News, Issue No. 2; Bankruptcy
Creditors' Service, Inc., 609/392-0900)

DebtTraders reports that Leap Wireless International Inc.'s
12.500% bonds due 2010 (LWIN10USR1) are trading between
13 and 15 cents-on-the-dollar.  See
http://www.debttraders.com/price.cfm?dt_sec_ticker=LWIN10USR1
for real-time bond pricing.


LEVEL 3 COMMS: Net Capital Deficit Narrows to $58MM at March 31
---------------------------------------------------------------
Level 3 Communications, Inc., (Nasdaq: LVLT) announced its first
quarter 2003 results. The net income for the quarter was
positive $119 million versus previously announced projections of
a net loss.  Included in net income was $326 million of revenue
associated with customer terminations and settlements, of which
$294 million relates to a non-cash settlement with XO
Communications and a $70 million gain on the sale of the
company's interest in its toll road operations. These two items
contributed a net gain of $396 million.

Consolidated revenue increased to $1.25 billion in the first
quarter 2003, from $945 million in the fourth quarter 2002,
primarily due to settlement revenue recognized in the quarter
and the inclusion of results generated from the acquisition of
substantially all of Genuity Inc.'s assets and operations,
effective February 4, 2003. Consolidated EBITDA (Earnings Before
Interest Taxes Depreciation and Amortization) increased to $406
million from $118 million for the previous quarter and $51
million for the same period last year [see schedule of non-GAAP
(Generally Accepted Accounting Principles) metrics for
definitions]. The significant increase from fourth quarter 2002
was primarily related to a contract settlement for transport
services including dark fiber, conduit and associated services.
The settlement resulted in recognition of $294 million of
revenue, for which cash had been previously received and which
the company had been recognizing over the expected contract
term. Consolidated Adjusted EBITDA (see schedule of non-GAAP
metrics for definitions) was $98 million in the first quarter
2003.

                    Financial Reporting Metrics

The company has historically provided financial metrics, some of
which are based on GAAP and others that are not prepared in
accordance with GAAP (non- GAAP). Recent legislative and
regulatory changes encourage the use of GAAP financial metrics
and require companies to explain why non-GAAP financial metrics
are relevant to management and investors. To the extent that
non-GAAP financial metrics are deemed to be relevant, companies
are required to reconcile those metrics to the most directly
comparable GAAP financial metrics.

As a result of these changes, the company has conducted a review
of its GAAP and non-GAAP financial metrics and has elected to
eliminate certain non-GAAP cash flow metrics, which it had
provided historically. Accompanying this press release is the
company's consolidated condensed statement of operations,
consolidated condensed balance sheet and consolidated statements
of cash flows. These statements provide relevant information on
the operating and cash flow performance of the company. In
addition, the company has developed two non-GAAP financial
metrics, unlevered cash flow and consolidated free cash flow
(see schedule of non-GAAP metrics for definitions), which are
derived from the consolidated statements of cash flows, and has
eliminated its previously provided metrics, operating cash flow
and free cash flow.

The company will continue to provide the following non-GAAP
metrics: communications gross margin, EBITDA and Adjusted
EBITDA. The company will not provide historical reconciliations
for non-GAAP metrics that have been eliminated.

                     Communications Revenue

Communications revenue for the first quarter 2003 was $708
million, versus $273 million for the previous quarter. Total
communications revenue included $667 million of communications
services revenue and $41 million attributable to reciprocal
compensation revenue. Included in communications services
revenue was $326 million of settlement and termination revenue.
For comparison purposes, communications services revenue,
excluding the effect of settlement and termination revenue, was
$341 million during the first quarter 2003, up from $233 million
during the fourth quarter 2002, due to the Genuity transaction
as well as growth in recurring revenue.

Termination revenue is recognized when deferred revenue is
accelerated as a result of customers disconnecting services, or
when customers make termination penalty payments to Level 3 to
settle contractually committed purchase amounts that they no
longer expect to meet. Settlement revenue is recognized when a
customer and Level 3 renegotiate a contract under which Level 3
is no longer obligated to provide services for consideration
previously received and deferred. There was no cash benefit to
$315 million of the $326 million in termination and settlement
revenue.

The company did not recognize managed web hosting revenue,
acquired in the Genuity transaction, during the first quarter as
a result of the pending sale of the managed web hosting business
to Computer Sciences Corporation.

"Our top line growth came predominately from the Genuity
transaction and our managed modem and dedicated Internet access
lines of business," said Kevin O'Hara, president and COO of
Level 3. "We are encouraged by the increase in recurring revenue
generated by our communications customers during the quarter."

Level 3 recently announced new customer agreements with
companies and institutions including eBay, Sony Online
Entertainment, PanAmSat, The George Washington University, and
the University of Oregon.

                          Cost of Revenue

Communications cost of revenue for the first quarter 2003 was
$89 million, resulting in an 87 percent communications gross
margin (see schedule of non- GAAP metrics for definitions),
versus 86 percent in the fourth quarter 2002 and 76 percent in
the same period last year.

Included in the 87 percent communications gross margin for the
first quarter 2003 was termination and settlement revenue of
$326 million, which has no corresponding cost of revenue. With
the exclusion of termination and settlement revenue, there was a
quarter-over-quarter decline in gross margin, primarily as a
result of the inclusion of lower margin revenue associated with
the operations acquired in the Genuity transaction subsequent to
the closing on February 4, 2003.

           Selling, General and Administrative Expenses

Communications SG&A expenses were $231 million for first quarter
2003, versus $163 million for the fourth quarter 2002, and
versus $232 million for the same period last year. For the same
periods, communications SG&A expenses include $21 million, $23
million and $62 million, respectively, of non-cash compensation
expenses. SG&A expenses during the first quarter 2003 were
higher primarily as a result of the addition of employees and
other expenses associated with the Genuity transaction. The
total number of employees in the communications business was
approximately 4,000 at the end of the first quarter 2003 versus
2,725 at the end of the fourth quarter 2002.

                Earnings Before Interest, Taxes,
                 Depreciation and Amortization

Communications EBITDA was $398 million for the first quarter
2003, including a restructuring charge of $11 million, versus
$105 million for the fourth quarter 2002.

                     Capital Expenditures

Consolidated gross capital expenditures for property, plant and
equipment were $25 million for the first quarter 2003, including
$3 million for information services and other businesses. During
the quarter, the company made final payments with respect to
several construction contracts that were $6 million below
previously estimated and accrued amounts.

              Network and Operational Highlights

Genuity Integration

"We have made good progress on the integration of Genuity's
operations into Level 3," said O'Hara. "While still early in the
overall process, we remain on our anticipated integration
timeline. To date, we have begun to close duplicative network
capacity and facilities, combine our network operating centers,
and migrate customer traffic onto the Level 3 network. In
addition, we recently announced that we were exiting the managed
web hosting business that we acquired. After concluding that it
did not adequately leverage our existing network infrastructure,
we determined that managed web hosting would not be a profitable
business for us over the long term."

As a result of the Genuity transaction, the company added
approximately 1,800 route miles during the first quarter to its
North American intercity network and began offering services in
five additional North American markets: Columbus, Milwaukee,
Minneapolis, Oklahoma City and Tulsa.

At the end of the first quarter 2003, Level 3 offered services
in 78 markets, consisting of 62 markets in North America and 16
markets in Europe. The company has local fiber networks in 36
markets and operates approximately 947,000 local fiber miles.

                Information Services Business Segment

Revenue

Information services revenue was $526 million for the first
quarter 2003, versus $642 million for the previous quarter. The
decline was expected due to seasonality and continued adoption
by Software Spectrum customers of Microsoft's new software
licensing program, which was introduced during the second half
of 2001. This new licensing program results in customers
licensing software from Microsoft and paying a service fee to
Software Spectrum. However, there is no significant impact to
profitability levels resulting from this change.

EBITDA

EBITDA from the information services business was positive $6
million for the first quarter 2003, compared to positive $5
million for the previous quarter. The total number of employees
in the information services business was approximately 3,480 at
the end of the first quarter.

                          Other Businesses

In January 2003 and as previously announced, Level 3 sold its
interest in the 91 Express Lanes, its toll road operations. The
company received approximately $46 million in cash proceeds and
recognized a gain of approximately $70 million and reduced long-
term debt by approximately $139 million. The company's other
business consists primarily of coal mining operations.

Revenue

Revenue from other businesses was $16 million for the first
quarter 2003, versus $30 million for the fourth quarter 2002 and
$28 million for the same period last year.

EBITDA

EBITDA from other businesses was $2 million for the first
quarter 2003, compared to $8 million last quarter and $3 million
for the first quarter 2002.

Consolidated Expenses

Stock-Based Compensation Expense: The company recognized $23
million in non-cash expenses for stock-based compensation during
the first quarter 2003. The company's Outperform Stock Option
(OSO) program represents the principal component of the
company's stock-based compensation. Since the inception of this
program in 1998, this expense has been accounted for in
accordance with SFAS No. 123, "Accounting For Stock-Based
Compensation." Level 3 expenses the value of OSOs and its other
stock-based compensation over the respective vesting period.

Under Level 3's plan, OSOs are issued quarterly, with the value
of the options indexed to the performance of the company's
common stock relative to the performance of the Standard &
Poor's 500 (S&P 500) Index.

Depreciation and Amortization: Depreciation and amortization
expenses for the quarter were $208 million, a 3 percent increase
over the previous quarter due primarily to depreciation and
amortization associated with certain assets acquired in the
Genuity transaction.

Cash Flow and Liquidity

During the first quarter 2003, unlevered cash flow was negative
$20 million and consolidated free cash flow was negative $124
million.

The Company's March 31, 2003 balance sheet shows a total
shareholders' equity deficit of about $58 million.

Corporate Transactions

During the first quarter 2003, Level 3 completed its acquisition
of substantially all of Genuity, Inc.'s assets and operations.
Level 3 paid $60 million in net cash consideration to the
Genuity Bankruptcy Estate and assumed certain long-term
operating agreements. As part of the transaction, Level 3 also
paid $77 million in cash for network obligations assumed by
Level 3, and incurred other transaction-related costs of
approximately $6 million.

           Capital Structure Changes and Asset Sales

Capital Structure Changes

During the first quarter 2003, the company's debt was reduced by
$159 million, including $139 million through the previously
announced sale of its interest in the 91 Express Lanes, and $20
million of principal amount of the company's 9% junior
subordinated convertible notes that were converted into equity.
As previously disclosed, the company assumed long-term capital
lease obligations as part of the Genuity transaction related to
vendor contracts associated with network services. Capital lease
obligations as of March 31, 2003 totaled $309 million, $121
million of which are classified as current liabilities on the
consolidated condensed balance sheet. These capital lease
obligations are expected to decline in future periods as the
company utilizes the associated network services.

Asset Sales

During the first quarter, the company sold excess real estate
and other excess operating assets, resulting in cash proceeds of
approximately $16 million.

In April 2003, Level 3 announced that it would exit the managed
web hosting business it acquired in the Genuity transaction.
Level 3 signed an agreement with Computer Sciences Corporation
under which CSC will serve Genuity hosting customers and
operations. As part of the transaction, CSC will also use Level
3's network services to serve hosting customers. Level 3 does
not expect this transaction to result in meaningful cash
proceeds nor materially affect earnings.

"We're pleased with the continuing improvement in our balance
sheet through debt reduction and asset sales," said Sureel
Choksi, CFO of Level 3. "Over the past two years, we have
reduced the face amount of debt by approximately $3.0 billion
and generated cash proceeds of approximately $500 million from
asset sales. We'll continue to evaluate debt reduction and asset
sale opportunities that we believe will create value for our
stockholders."

                     Board and Management

Recent regulatory changes have required many companies to modify
the composition of their board of directors. Effective at the
2003 Annual Meeting to be held on May 20, 2003, the company's
Board of Directors is expected to consist of 11 directors,
divided into three classes designated Class I, Class II and
Class III. At that time, Class I and II will consist of four
directors and Class III will consist of three directors.

Three of the current Class III directors, Messrs. R. Douglas
Bradbury, currently vice chairman of the board and a former
employee of the company, Kevin J. O'Hara, and Kenneth E.
Stinson, chairman and CEO of Peter Kiewit Sons', Inc. have
decided not to seek reelection to the Board of Directors. In
addition, two directors that are members of Class I, Charles C.
Miller III, vice chairman of Level 3 and chairman of Information
Services Group, and Colin V.K. Williams, a former employee of
the company, have informed the company that each intends not to
seek reelection to the Board after the expiration of their
current term of office at the 2004 Annual Meeting of
Stockholders.

As a result of these changes and changes in 2004, the company
expects that the composition of the Board of Directors will be
in compliance with applicable rules and regulations requiring
that a majority of the board members be independent.

"I want to thank Doug, Kevin, and Ken for the tremendous service
they have provided to Level 3 as members of the board," said
James Q. Crowe, chief executive officer of the company. "I'm
pleased that both Kevin and Doug will continue to provide the
benefits of their experience and counsel to the company through
employment and ongoing relationships."

As previously announced, Level 3 recently named two new Class
III directors. They are Arun Netravali, former president of Bell
Labs and former chief technology officer for Lucent
Technologies, and John T. Reed, a director of the McCarthy Group
merchant-banking firm. Both Reed and Netravali will stand for
re-election at the upcoming annual meeting for new terms that
will expire in 2006.

                      Business Outlook

"We continued to see improvements in financial and operational
metrics for the communications business during the past three
months, although sales cycles continue to be longer than we
would like," said Crowe. We continue to believe that we reached
a bottom in terms of new sales levels during the middle of 2002,
and are cautiously optimistic that we will continue to see
gradual improvements. In addition, we have demonstrated an
ability to continue to improve cash flow as a result of tight
management of expenses."

"We believe we are positioned to realize significant cost
synergies, after a successful integration of the Genuity
business, resulting in further improvements in cash flow," Crowe
added. "We are focused on long-term value creation by improving
consolidated free cash flow through recurring revenue growth and
new product development, as well as opportunistic acquisition
activity."

"In the information services business, we began to experience
softness in sales toward the end of the first quarter, which has
continued thus far in the second quarter," said Miller. "We
believe this top-line weakness is due to enterprise customers
delaying software purchase decisions as a result of general
economic weakness and a lack of significant software vendor
promotions."

              Quarterly and Full Year Projections

"Our full year 2003 unlevered cash flow projections are
consistent with operating cash flow projections provided earlier
in the year," said Choksi. "Our projections for the
communications business are consistent with those previously
provided, with three adjustments that have immaterial effects on
cash flow. Our updated revenue and EBITDA projections
incorporate the significant non-cash contract settlement
transaction completed during the first quarter, the anticipated
sale of the managed web hosting business, and a modification
relative to the previously anticipated accounting for prepaid
network services associated with the Genuity transaction."

"Based on the sales weakness we are currently experiencing in
the information services business, as well as accelerated
adoption by Software Spectrum customers of Microsoft's new
licensing program that results in reduced reported revenue, but
does not significantly impact margins, we are reducing our full
year projection for information services revenue by
approximately 13 percent. We are taking steps to further align
our cost structure with anticipated revenues to mitigate
potential EBITDA effects associated with the anticipated revenue
shortfall," said Choksi.

Level 3 expects consolidated revenue to be approximately $945
million during the second quarter 2003, including $425 million
from the communications business, $500 million from information
services and $20 million from other businesses. Approximately
$390 million of communications revenue is expected to come from
communications services revenue, including $10 million in
termination and settlement revenue. Approximately $35 million in
revenue is expected from reciprocal compensation. Communications
services revenue, excluding termination and settlement revenue,
is expected to grow from $341 million in the first quarter 2003
to $380 million in the second quarter 2003. The anticipated
quarter-over-quarter increase in revenue is due to the inclusion
of a full quarter of results related to the Genuity transaction,
offset partially by anticipated churn in revenue from customers
acquired through the Genuity transaction, a reduction in revenue
from XO Communications resulting from the settlement reached
during the first quarter, and a decline in voice revenue from a
major customer.

Level 3 (Nasdaq: LVLT) is an international communications and
information services company. The company operates one of the
largest Internet backbones in the world, is one of the largest
providers of wholesale dial-up service to ISPs in North America
and is the primary provider of Internet connectivity for
millions of broadband subscribers, through its cable and DSL
partners. The company offers a wide range of communications
services over its 20,000-mile broadband fiber optic network
including Internet Protocol (IP) services, broadband transport,
colocation services, Genuity managed services, and patented
Softswitch-based managed modem and voice services. Its Web
address is http://www.Level3.com

Level 3 Communications Inc.'s 11.000% bonds due 2008
(LVLT08USR1) are 84 cents-on-the-dollar. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=LVLT08USR1
for real-time bond pricing.


MAGELLAN HEALTH: Seeks Court Okay on Healthcare Partners Pact
-------------------------------------------------------------
Magellan Health Services, Inc., and its debtor-affiliates ask
the Bankruptcy Court to put its stamp of approval on a letter
agreement, dated December 3, 2002, among Magellan, HealthCare
Partners, Inc., Steven J. Shulman, and Dr. Rene Lerer and
Schedule B thereto executed by Magellan, Keith Kudla and Danna
Mezin.  Under that Letter Agreement, HealthCare Partners
provides Magellan with on-going management consulting services.
The Debtors ask the Court to ratify the Agreement as of the
Petition Date.

Under the Engagement Letter, HealthCare Partners makes Steven J.
Shulman and Dr. Rene Lerer, each of whom are principals of
HealthCare Partners, and Keith Kudla and Danna Mezin, each of
whom are consultants, available to act as Magellan's officers.

Stephen Karotkin, Esq., at Weil, Gotshal & Manges LLP, in New
York, informs the Court that prior to the Petition Date, Daniel
S. Messina resigned as Magellan's Chief Executive Officer.  Due
to the size of the Debtors' operations and their attendant
financial difficulties, at that time, Magellan determined that
it needed to augment its existing management and, most
importantly, hire a new Chief Executive Officer.  Magellan also
determined that extensive management experience in the
healthcare field was a prerequisite to the hiring of any new
management.  After an extensive interview process, during which
several other candidates were interviewed and considered,
Magellan selected HealthCare Partners and the Officers to
augment its management team; primarily because of the Officers'
expertise and experience generally in providing financial and
operating services to healthcare companies.

In order to implement the selection of HealthCare Partners, Mr.
Karotkin relates that Magellan and HealthCare Partners
negotiated and entered into the Engagement Letter.  Pursuant to
the Engagement Letter, HealthCare Partners agreed to make Mr.
Shulman available to serve as Magellan's Chief Executive
Officer.  The Engagement Letter further provided that, as Chief
Executive Officer, Mr. Shulman would appoint the other Officers
as officers of Magellan.  Accordingly, on January 8, 2003, Mr.
Shulman appointed Dr. Lerer as Chief Operating Officer of
Magellan, on February 12, 2003, Mr. Shulman appointed Mr. Kudla
as Senior Vice President of Business Initiatives and Performance
Management and on January 24, 2003, Mr. Shulman appointed Ms.
Mezin as Senior Vice President of Customer Services.  HealthCare
Partners and the Officers have been rendering services to the
Debtors since December 2002.

According to Mr. Karotkin, HealthCare Partners is a newly formed
entity that specializes in providing management and other
business consulting services to healthcare and managed care
companies.  Through their prepetition work with the Debtors,
HealthCare Partners and the Officers have become extremely
familiar with the Debtors' finances and operations and advised
them regarding numerous issues attendant to the filing of their
Chapter 11 cases.  Also, HealthCare Partners and the Officers
have become intimately familiar with the tasks the Debtors will
confront through the course of their restructuring effort and,
since the Petition Date, have been intimately involved in the
day to day operations of the Debtors, including extensive
contact with key customers.

Mr. Karotkin notes that Mr. Shulman and the other Officers have
substantial experience as executives and otherwise working with
healthcare and managed care companies.  Prior to his employment
with HealthCare Partners, Mr. Shulman held executive positions
with, among others, Prudential HealthCare Group, Inc., Value
Health, Inc., Internet HealthCare Group, CIGNA Health Plans and
Kaiser Permanente Medical Care Program.  Prior to joining
HealthCare Partners, Dr. Lerer held senior management positions
with Prudential HealthCare Group, Inc., Internet HealthCare
Group, Value Health, Inc. and Traveler's Insurance Company.  In
addition, Ms. Mezin and Mr. Kudla have both held, among other
things, management positions with Prudential HealthCare Group,
Inc.

The Debtors believe the Officers possess extensive knowledge and
expertise particularly useful to the Debtors and their
operations, and that the Officers are well-qualified to render
services on behalf of the Debtors.  The Debtors selected
HealthCare Partners because of the Officers' expertise in
providing management services to healthcare companies, and
because the Officers have excellent reputations in the
healthcare field.

Mr. Karotkin insists that the services of HealthCare Partners
and the Officers are necessary to enable the Debtors to execute
their duties as debtors-in-possession and critical to the
reorganization effort under Chapter 11.  The Debtors submit that
the continued employment of the Officers to assist the Debtors
during these Chapter 11 cases is essential to the success of
these cases.

The services that HealthCare Partners and the Officers have
provided and will continue to provide to the Debtors will
include:

     A. provide overall management of the Debtors' operations;

     B. implement the business plan as developed by management
        and Boards of Directors of the Debtors as the plan may be
        amended from time to time;

     C. refine the existing operation plan and cash flow forecast
        and present the plan and forecast to the Board and the
        Debtors' creditors;

     D. execute and implement cost reduction and operations
        improvement opportunities and further refine the Debtors'
        cost reduction and operations improvement plan through
        review of the Debtors' facilities, personnel and
        operating procedures;

     E. communicate with shareholders, customers and creditors of
        the Debtors and meet with representatives of the
        constituents to discuss the business operations,
        financial performance and general condition of the
        Debtors and the progress made to implement the operating
        plan and any modifications thereof; and

     F. other reasonable activities as are approved by the Board
        from time to time.

The Engagement Letter terminates on the consummation of a
restructuring, or, at Magellan's option, 45 days thereafter.

The Engagement Letter provides that HealthCare Partners will
charge the Debtors a $250,000 monthly fee, as well as
reimbursement for reasonable out-of-pocket expenses incurred in
connection with the performance of the engagement, i.e., travel,
lodging, temporary relocation and telephone charges.  The
Engagement Letter further provides for a minimum aggregate
amount paid in respect of Monthly Fees of $1,500,000, unless the
Engagement Letter is terminated by HealthCare Partners or "For
Cause" by the Debtors.  In addition, HealthCare Partners will be
entitled to receive a performance-based success bonus, which
could be as much as $2,000,000 based on the consummation of a
successful restructuring and the achievement of various
financial and operational targets.

Mr. Karotkin states that the Officers' healthcare expertise was
an important factor in determining the amount of the Monthly Fee
and the Reorganization Fee.  The ultimate benefit of HealthCare
Partners' and the Officers' services to the Debtors and the
Debtors' estates is not appropriately measured merely by
reference to the number of hours to be expended by the Officers
in the performance of the services.

Given the numerous issues which HealthCare Partners and the
Officers will be required to address in the performance of their
services, HealthCare Partners' and the Officers' commitment to
the variable level of time and effort necessary to address all
the issues as they arise, and the prevailing market prices for
retaining persons of the caliber and with the experience of the
Officers, the Debtors submit that the fee arrangement provided
for in the Engagement Letter is both fair and reasonable and
should be approved.

Mr. Karotkin adds that the Debtors have agreed to indemnify
HealthCare Partners and the Officers against any liability
arising in connection with the Engagement Letter, other than
losses, claims, damages, liabilities or expenses that are the
result of the indemnified party's gross negligence or willful
misconduct.  In addition to the indemnity provided in the
Indemnity Agreement, the Debtors have agreed to indemnify each
of the Officers for all acts performed as an officer of the
Debtors to the maximum extent permitted by law.  The Engagement
Letter also prohibits HealthCare Partners and the Officers from
soliciting or recruiting any of the Debtors' employees and
soliciting or contacting any of their customers or providers in
a manner, which would interfere with their business, for a
period of eighteen months subsequent to the termination of the
Engagement Letter.

Mr. Karotkin contends that HealthCare Partners and the Officers
were selected based on their substantial expertise, and, since
their retention, they have provided the Debtors with leadership
capability that is critical to the stabilization process and
which has instilled significant confidence in the Debtors'
customers, providers and employees.  The Debtors believe that it
is essential to the success of the reorganization process that
this leadership stay in place.

The Debtors also submit that the economic terms of the
Engagement Letter are reasonable and consistent with the market,
particularly in view of the extent of the services to be
provided.  Under these circumstances, the Debtors believe that
entering into the Engagement Letter represented a sound and
rational exercise of the Debtors' business judgment and that it
should be ratified and approved.

Mr. Karotkin relates that although not being retained as a
professional pursuant to Section 327 of the Bankruptcy Code,
HealthCare Partners has nonetheless performed a conflict check.
To the best of the Debtors' knowledge, information and belief,
HealthCare Partners does not represent or hold any interest
adverse to the Debtors' estates or their creditors in the
matters upon which HealthCare Partners is to be engaged.  In
addition, HealthCare Partners is a "disinterested person," as
the term is defined in Section 101(14) of the Bankruptcy Code,
as modified by Section 1107(b) of the Bankruptcy Code. (Magellan
Bankruptcy News, Issue No. 5: Bankruptcy Creditors' Service,
Inc., 609/392-0900)


LUCENT TECHNOLOGIES: Consolidating Senior Management Positions
--------------------------------------------------------------
Lucent Technologies will consolidate the responsibilities of its
top management. In addition to her responsibilities as chairman
and CEO, Patricia Russo will assume the responsibilities of Bob
Holder, who has served as chief operating officer of Lucent
since October 2001. Holder will work through a transition and
leave Lucent this summer.

"I want to thank Bob for his significant contributions to Lucent
through the years, and in particular the leadership he has shown
during the difficult restructuring the company has embarked on
these past two years," Russo said. "Now that a number of
significant issues are behind us, including the SEC
investigation and shareowner litigation, I decided that it was
the right time to consolidate our top management structure and
for me to manage operations more directly."

As chief operating officer, Holder, 56, had responsibility for
Lucent's major units -- Mobility Solutions, Integrated Network
Solutions, Lucent Worldwide Services, Supply Chain Networks and
Information Technology. These organizations will initially
report directly to Russo and the chief operating officer
position will be eliminated.

Prior to his position as chief operating officer, Holder was
executive vice president for corporate operations. He has been
with Lucent since it was spun off from AT&T in 1996 after a long
career with AT&T.

"I am very proud of my years at Lucent and what I have been able
to accomplish working with capable, dedicated people throughout
this business, in particular Pat Russo and Henry Schacht,"
Holder said. "I agree with Pat that this is the right time to
streamline the senior management structure. Lucent has a strong
team in place, and I will enjoy watching this company as it
moves forward."

Former Lucent Chairman and CEO Henry Schacht commented, "Bob's
steady hand, experience and leadership were critical to getting
Lucent through an incredibly tough period. I want to thank him
for the lasting contributions he has made to this business and
for his help in turning this company around and moving it on the
path to profitability."

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

Lucent Technologies' 7.700% bonds due 2010 (LU10USR1) are
trading at about 75 cents-on-the-dollar, DebtTraders reports.
See http://www.debttraders.com/price.cfm?dt_sec_ticker=LU10USR1
for real-time bond pricing.


LYONDELL CHEMICAL: Doubles First Quarter 2003 Net Loss to $113MM
----------------------------------------------------------------
Rapidly escalating crude oil and natural gas prices reduced
profitability at Lyondell Chemical Company (NYSE: LYO) through
the first quarter of 2003. The company announced a net loss for
the quarter of $113 million. This compares to a net loss of $55
million for the first quarter of 2002, and a net loss of $93
million for the fourth quarter 2002.

During the quarter, according to the New York Mercantile
Exchange, daily crude oil prices peaked at $37.83 per barrel, an
increase of $6.63 per barrel over the year-end price, and
natural gas prices peaked at $9.57 per million BTUs in late
February, an increase of $4.78 per million BTUs over the year-
end price. Lyondell and Equistar Chemicals, LP, implemented
product price increases in an effort to offset the rapid
increases in raw material costs, but the pace of their
implementation was not sufficient to fully offset the financial
impact of the cost increases during the quarter. At LYONDELL-
CITGO Refining LP, operations benefited as the crude oil supply
from Venezuela and overall operating rates returned to full
levels in February and March.

"The volatility and pace of increases in energy and raw material
costs, coupled with the general strike in Venezuela, imposed
pressures on our enterprise that were as extreme as I have
experienced in my years in the industry," said Lyondell
President and CEO Dan F. Smith. "Even so, our focus on
operational excellence, operating flexibility and financial
strategy enabled us to respond and meet the challenges presented
in the quarter."

During the first quarter of 2003, Lyondell completed several
projects and transactions that advanced the company's strategy
and improved its short-term liquidity. The gains and losses on
these projects and transactions, coupled with interest income
from a favorable tax-related settlement, increased Lyondell's
earnings by $6 million after taxes. The projects and
transactions are:

-- Lyondell's Intermediate Chemicals & Derivatives segment
    restructured Nihon Oxirane, its joint venture with Sumitomo
    Chemical Company, Ltd., in a manner that strengthens
    Lyondell's position in Asia.

-- Equistar entered into a long-term propylene supply
    arrangement with Sunoco and sold its Bayport polypropylene
    unit to Sunoco, enabling both companies to focus on their
    respective strengths and strategic priorities.

-- LCR revised plans for its low-sulfur gasoline project by
    utilizing integration opportunities with Lyondell and CITGO
    Petroleum Corp. This will result in longer-term reductions in
    overall capital expenditures.

-- Both Lyondell and Equistar successfully renegotiated their
    bank covenants, enhancing each entity's financial
    flexibility.

"Our ability to complete these significant long-term projects
and renegotiate our debt covenants during these volatile times
demonstrates not only the depth and capability of our
organization, but also the confidence that our business and
financial partners have in us," Smith said.

                            OUTLOOK

While raw material and energy costs peaked in late February and
early March, they have since moderated. This, together with
increased prices in Equistar's ethylene chain and co-products,
has improved ethylene chain economics, particularly for
production from crude oil-based raw materials. In IC&D, margins
in propylene oxide and derivatives are improving as a result of
price increases that are beginning to take effect. However, the
combination of increased product prices and global economic and
political uncertainty is negatively impacting IC&D and Equistar
sales volumes early in the second quarter.

"The instability created by the war in Iraq and unrest in other
oil-producing nations makes it very difficult to provide a near-
term outlook," Smith said. "Nevertheless, margins have improved
and we believe the industry is positioned to show a significant
near-term rebound barring further economic deterioration or
increases in raw material and energy costs. Most importantly,
the longer-term fundamentals for our businesses appear to be
improving and we expect to benefit when the resolution of global
events and economic uncertainties is more clear."

                     LYONDELL AND JOINT VENTURES

Lyondell's operations comprise: Lyondell's IC&D segment;
Equistar, a joint venture with Millennium Chemicals Inc.; and
LCR, a joint venture with CITGO Petroleum Corp. Each plays a
unique role in supporting the enterprise during all phases of
the business cycle.

Lyondell's Intermediate Chemicals & Derivatives Segment - The
IC&D segment includes PO and derivatives, MTBE and styrene.
Results in the first quarter 2003 benefited from an $18 million
gain related to the restructuring of the Nihon Oxirane joint
venture and $15 million of interest income from a favorable tax-
related settlement.

1Q03 v. 1Q02 - Compared to the first quarter of 2002, higher
volumes in PO and derivatives only partially offset the effect
of margin compression that resulted from increased energy and
raw material costs, particularly propylene. The majority of the
financial shortfall occurred in the co-product area, where the
previously announced expiration of a major MTBE sales contract
with BP and lower margins compared to year-ago levels had a
negative impact on performance. Styrene performance was
relatively unchanged. Higher product prices and margins improved
TDI performance over the same period last year.

1Q03 v. 4Q02 - Compared to the fourth quarter of 2002, generally
higher sales volumes in PO and derivative products essentially
offset lower margins that resulted when escalations in raw
material costs outpaced increases in product prices. MTBE
performance was negatively impacted by a number of factors,
including expiration of the BP contract and high raw material
costs. Styrene performance was down slightly versus the prior
quarter as price increases lagged cost increases. TDI
performance in the first quarter 2003 exceeded the previous
quarter's performance as a result of volume and price increases
and the absence of fourth-quarter maintenance costs.

Equistar Chemicals, LP - Lyondell owns a 70.5 percent interest
in Equistar, which consists of the petrochemicals (including
ethylene) and polymers segments. Results in the first quarter
2003 included a $12 million loss on the sale of Equistar's
Bayport polypropylene asset.

1Q03 v. 1Q02 - While ethylene and polymer sales prices averaged
approximately 10 cents per pound higher compared to the first
quarter of 2002, the average cost of ethylene production in the
first quarter of 2003, as reported by Chemical Marketing
Associates Inc., more than offset those price increases.
Equistar's combined ethylene and derivatives sales volumes were
essentially flat period to period.

1Q03 v. 4Q02 - Rapidly escalating natural gas and crude oil
prices in the first quarter of 2003 caused the cost of ethylene
to increase dramatically. CMAI estimates that in the first
quarter of 2003 the cost of ethylene production increased more
than 5 cents per pound from the fourth quarter of 2002. While
Equistar's product sales price increases in ethylene,
polyethylene and ethylene glycol more than equaled the higher
ethylene costs, the timing of the price increases was such that
the average product margin in the first quarter of 2003 was
lower than the average fourth-quarter 2002 product margin.
Equistar's combined ethylene and ethylene derivatives sales
volumes were essentially unchanged versus the fourth quarter of
2002.

LYONDELL-CITGO Refining LP - Lyondell owns a 58.75 percent
interest in LCR, a major refiner of heavy crude oil. Results in
the first quarter 2003 included a $25 million charge related to
the restructuring of LCR's low-sulfur gasoline project.

1Q03 v. 1Q02 - Compared to the first quarter of 2002,
disruptions in deliveries of crude oil from Venezuela and high
natural gas prices negatively impacted LCR's performance.
However, these factors were offset by strong spot volumes and
refining spreads during the quarter.

1Q03 v. 4Q02 - LCR's total crude processing rate in the first
quarter 2003 was lower than in the previous quarter, averaging
245,000 barrels per day versus 250,000 barrels per day in the
fourth quarter 2002. Due to the Venezuelan strike, crude oil
volumes processed under the Crude Supply Agreement were limited
to 194,000 barrels per day during the first quarter 2003,
compared to 209,000 barrels per day in the fourth quarter 2002.
However, disruptions in crude oil deliveries from Venezuela were
limited to January 2003. During February and March, the
combination of strong operations, Venezuelan crude deliveries
and improved refining margins were sufficient to offset the
impact of the January disruptions, but were not enough to offset
the impact of higher first-quarter natural gas costs.

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

As reported in Troubled Company Reporter's March 26, 2003
edition, Fitch Ratings affirmed Lyondell Chemical Company's
senior secured credit facility rating at 'BB-', Lyondell's
senior secured notes at 'BB-', and Lyondell's senior
subordinated notes 'B'. Fitch has also affirmed the 'BB-' rating
on Equistar Chemicals L.P. senior secured credit facility, and
'B' rating on the Equistar's senior unsecured notes. The Rating
Outlook remains Negative for both Lyondell and Equistar.

The ratings reflect Fitch's concerns that a substantial margin
recovery at Lyondell and Equistar could be delayed for up to a
year due to uncertainty in the overall economy and persisting
trough like conditions in the chemical industry. Both companies
are heavily leveraged and expect high debt levels to remain
until cash generation from operations improves. For both
Lyondell and Equistar, access to liquidity via senior secured
credit facilities and capital markets will continue to be an
important credit issue in light of potentially large capital
expenditure requirements and cyclically weak cash flow from
operations.


MATLACK SYSTEMS: Trustee Hires Keen Realty as Estate Consultant
---------------------------------------------------------------
Gary F, Seitz, the Chapter 7 Trustee overseeing the winding-up
of the estates of Matlack Systems, Inc., asks for approval from
the U.S. Bankruptcy Court for the District of Delaware to retain
Keen Realty LLC as Special Real Estate Consultants for the
Debtors' Norwich Property located in 1-4 Matlack Road in
Norwich, Connecticut.  The Trustee tells the Court that he needs
the assistance of Keen Realty in liquidating the Norwich
Property.

The Trustee expects Keen Realty to:

      i) review all pertinent documents and consult with the
         Chapter 7 Trustee's counsel, as appropriate;

     ii) assist the Chapter 7 Trustee in marketing the Norwich
         Property in a manner consistent with the procedures for
         liquidating the Norwich Property and reasonable in the
         Chapter 7 Trustee's business judgment;

    iii) respond and provide information to, negotiate with, and
         solicit offers from prospective purchasers and make
         recommendations to the Chapter 7 Trustee as to the
         advisability of accepting particular offers and
         settlements;

     iv) assist counsel with the implementation of the proposed
         transactions, review documents, and negotiate and
         resolve any problems that may arise; and

      v) if required, appear in court during the term of this
         retention to testify or consult with the Chapter 7
         Trustee in connection with the marketing or disposition
         of the property.

Keen Realty will be paid 3% of the gross cash consideration
received for the Norwich Property, payable from the proceeds of
the sale.

Before filing for chapter 11 protection, Matlack Systems, Inc.,
North America's No. 3 tank truck company, provides liquid and
dry bulk transportation, primarily for the chemicals industry.
The Debtors converted their chapter 11 cases to cases under
Chapter 7 of the Bankruptcy Court on October 18, 2002 (Bankr.
Del. Case No. 01-1114).  Gary F, Seitz serves as the Chapter 7
Trustee.  Richard Scott Cobb, Esq., at Klett Rooney Lieber &
Schorling represents the Debtors as they wind up their affairs.


MIDLAND COGENERATION: Fitch Removes BB Rating from Watch Neg.
-------------------------------------------------------------
Fitch Ratings has removed the Rating Watch Negative from the
'BB' rating on Midland Cogeneration Venture LP's $567 million
lease obligation bonds (the MCV bonds). The rating action
follows the removal of the Rating Watch Negative from the
ratings of Consumers Energy Co., MCV's principal offtaker.
Consumers' senior unsecured debt is rated 'BB', and the Rating
Outlook for Consumers is Stable. Absent counterparty credit
concerns, Fitch views the MCV bonds as having characteristics
consistent with low investment grade quality.

MCV is a nominal 1,500 MW gas-fired cogeneration facility
located in Midland, MI. MCV sells electrical energy to Consumers
under a long-term power purchase agreement (PPA). Revenues under
the PPA provided approximately 94% of MCV's total revenue for
the year ended Dec. 31, 2001. The remaining revenue was earned
primarily from steam and electric sales under long-term
contracts with nearby Dow Chemical and Dow Corning facilities.
Considering the economic significance of the Consumers PPA,
MCV's credit quality is constrained by the counterparty rating
of Consumers.

On April 23, 2003, Fitch affirmed the ratings of CMS Energy
Corp. (CMS) and its primary subsidiary, Consumers, and removed
the ratings from Rating Watch Negative. The rating affirmations
follow recent positive actions taken by CMS to improve its
liquidity and business position. These include a definitive
agreement to sell the Panhandle Companies to Southern Union Co.
('BBB'/Stable), the successful refinancing of $1.465 billion of
bank facilities and the release of audited annual financial
restatements. Following the completion of the Panhandle
transaction, CMS will be almost entirely dependent on cash
distributions from Consumers for debt service. As a result,
Fitch believes that further improvement in Consumers' ratings
will be largely dependent on the stabilization of CMS' credit
quality. On a standalone basis, Consumers' credit profile is
solid relative to the current ratings which reflect constraint
due to ownership linkage to CMS.

The MCV bonds were issued by Midland Funding Corp. II ($367
million taxable due 2005 and 2006) and Midland County Economic
Development Corp. ($200 million tax-exempt due 2009).


ML CBO XIV: S&P Further Junks 2 Series 1998-E&P-1 Class Ratings
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its ratings on the
class A-2 and A-3 notes issued by ML CBO XIV Ltd.'s series 1998-
E&P-1, an arbitrage CBO transaction originated in 1998, to 'CC'
from 'CCC' and removed the ratings from CreditWatch with
negative implications where they had been placed Feb. 8, 2002.
The class A-1 notes issued by this transaction were paid down in
full on the Feb. 24, 2003 payment date.

The current rating action reflects factors that have eroded the
credit enhancement available to support the rated notes,
primarily a continuing par erosion of the collateral pool
securing the rated notes and downward migration of the credit
quality of the performing assets remaining within the collateral
pool. According to the March 24, 2003 monthly report, the class
A-2 and A-3 overcollateralization ratio was 79.07%, compared to
its minimum required ratio of 117% and a ratio of approximately
127.8% as of the transaction's effective date. According to the
March report, $6.6 million (or 7.03%) of the portfolio's
collateral debt securities were defaulted, and of the performing
assets in the portfolio, $43.3 million (or 46.1%) come from
'CCC'-rated obligors.

                    RATINGS LOWERED; OFF CREDITWATCH

                 ML CBO XIV (Cayman) Ltd. Series 1998-E&P-1

               Rating                    Current
Class     To          From              Balance (mil $)
A-2       CC          CCC/Watch Neg              $64.1
A-3       CC          CCC/Watch Neg              $47.8


METROMEDIA: Completes Exchange of Business Assets with Adamant
--------------------------------------------------------------
Metromedia International Group, Inc., (OTCBB:MTRM), the owner of
interests in various communications and media businesses in
Eastern Europe, the Commonwealth of Independent States and other
emerging markets, completed an exchange with Adamant Advisory
Services, a British Virgin Islands company, of its ownership
interest in certain of its business units in Russia for
approximately $58.6 million, face value, of the Company's
10-1/2% Senior Discount Notes held by Adamant.

In this transaction, the Company conveyed to Adamant its
ownership interests in Comstar (a Moscow based fixed-line
telephony operator), Kosmos TV (a Moscow based cable television
operator), and the Company's Russian radio assets. In addition
to conveying the Senior Notes to the Company, Adamant paid US$5
million in cash and also released the Company of its $3.1
million obligation to pay interest accrued on the Senior Notes
being exchanged.

In making this announcement, Mark Hauf, Chairman, President and
Chief Executive Officer of the Company, commented, "Completion
of this transaction is an important step in our management of
the liquidity pressures that the Company currently faces. By
eliminating a substantial portion of the Company's outstanding
debt, we have significantly improved our ability to address and
resolve the Company's remaining liquidity issues. Our goal
continues to be centered upon ensuring that the Company is able
to meet its financial obligations when they become due." With
the conclusion of this transaction, approximately $152 million
principal amount of the Company's Senior Notes remain
outstanding.

Andrei Volgin of Adamant Advisory Services commented: "We
believe that this transaction will help to further enhance the
already strong market position of these businesses."

Hauf further commented: "We continue active engagement with our
key financial stakeholders on debt restructuring measures in an
effort to resolve our liquidity issues in a fashion that best
preserves value for all interested parties."

The Company also announced the resignation of Carl C. Brazell
Jr. as a member of the Company's Board of Directors. The Company
has not announced a replacement.

Metromedia International Group, Inc., is a global communications
and media company. Through its wholly owned subsidiaries and its
business ventures, the Company owns and operates communications
and media businesses in Eastern Europe, the Commonwealth of
Independent States and other emerging markets. These include a
variety of telephony businesses including cellular operators,
providers of local, long distance and international services
over fiber-optic and satellite-based networks, international
toll calling, fixed wireless local loop, wireless and wired
cable television networks and broadband networks and FM radio
stations. Please visit its Web site at
http://www.metromedia-group.com

                        *      *      *

As reported in Troubled Company Reporter's January 8, 2003
edition, the Company said it did not believe that it would be
able to fund its operating, investing and financing cash flows
during the next twelve months, without additional asset sales.
In addition, the Company would be required to make another semi-
annual interest payment of $11.1 million on March 30, 2003, on
its 10-1/2 % Senior Discount Notes. As a result, there is
substantial doubt about the Company's ability to continue as a
going concern.

The Company has consummated certain asset sales, continues to
explore possible asset sales to raise additional cash and has
been attempting to maximize cash repatriations by its business
ventures to the Company.

                      Noteholder Discussions

The Company has also held periodic discussions with
representatives of holders of its Senior Discount Notes in an
attempt to reach agreement on a restructuring of its
indebtedness in conjunction with any proposed asset sales or
restructuring alternatives. To date, the representatives of the
holders of its Senior Discount Notes and the Company have not
reached any agreement on terms of a restructuring.

The Company cannot make any assurance that it will be successful
in raising additional cash through asset sales or through cash
repatriations from its business ventures, nor can it make any
assurance regarding the successful restructuring of its
indebtedness.

If the Company were not able to resolve its liquidity issues,
the Company would have to resort to certain other measures,
including ultimately seeking bankruptcy protection.


NAVISITE INC: Names Jim Pluntze as New Chief Financial Officer
--------------------------------------------------------------
NaviSite, Inc. (Nasdaq: NAVI), a leading provider of Application
and Infrastructure Management Services, has named Jim Pluntze to
the position of Chief Financial Officer. An industry veteran,
Pluntze brings 18 years of experience and a strong track record
in the technology services and software industries to NaviSite.
In this new role, Pluntze will be responsible for overseeing all
of the financial, accounting and reporting functions as the
company continues its transformation into a leading managed
services company.

Pluntze will replace CFO and COO, Kevin Lo, who has successfully
led NaviSite's operational and financial organizations through
significant merger and integration activities for the past 20
months. Lo has played an important role in the drive towards
profitability through the acquisitions, integrations, and
restructuring of Conxion, Avasta, Applied Theory, and ClearBlue
Technologies Management. Lo will remain with NaviSite as a
consultant focused on merger and acquisition related activities.

Additionally, executive vice president for Business Development,
Gabriel Ruhan, will move into a more active operational role as
COO. He will lead NaviSite's day-to-day efforts including
overseeing sales, marketing, product strategy and management,
service delivery, and office of CIO.

Pluntze joins NaviSite after having served on its Board of
Directors as Chairman of its audit committee. Prior to NaviSite,
Pluntze was the CFO of Lanthorn Technologies (Boston, MA), where
he was responsible for strategic planning, raising venture
capital financing and administrative functions for a leading
provider of software solutions for public utilities. Prior to
Lanthorn, Pluntze was CFO for Guardent, a managed security
services provider located in Waltham, MA, where he was as a key
member of the Executive team, responsible for the finance,
accounting, treasury, tax, facilities and internal technology
functions of the corporation. Before Guardent, he served as Vice
President of Finance for Razorfish, a publicly traded global
professional services company engaged in the design, development
and implementation of eBusiness systems.

"We are extremely pleased to bring on a person of Jim's
experience, integrity, and expertise," said Arthur Becker, CEO
of NaviSite. " As NaviSite continues to mature into the role of
preeminent managed services provider, it is important to have
leaders who has excelled in this environment before."

NaviSite is a Service Company providing Application and
Infrastructure Management Services for online operations of mid-
sized enterprises, business units of larger companies and
government agencies. With a world-class group of experienced
professionals, NaviSite delivers excellence through a flexible,
customizable suite of engineered solutions. NaviSite balances
service-centric people and process with cost effective,
innovative technology in areas such as Managed Applications,
Application Development, Hosting, Security and Infrastructure.

NaviSite Application Management Services deliver application
development, integration and full-service management, at any of
our data centers, a customer's location or even a third-party
site. NaviSite manages critical online and enterprise
applications through proactive technology and services,
providing 24/7 application monitoring, management and
maintenance: relieving customers of day-to-day application
operations burdens.

NaviSite's Infrastructure Management Services provide secure,
reliable, high-performance hosting services at data centers
serving: Boston, Chicago, Dallas, Las Vegas, Los Angeles,
Milwaukee, New York, San Francisco, Syracuse (NY) and
Washington, DC.

Services include a full array of managed hosting to collocation,
coupled with high-performance Internet access and high-
availability server management solutions through load balancing,
clustering, mirroring and storage services.

Founded in 1997, NaviSite, Inc. is publicly traded on Nasdaq as
NAVI. For more information, please visit http://www.NaviSite.com
NaviSite is headquartered at 400 Minuteman Road, Andover, Mass.
01810, USA.

                            *    *    *

               Liquidity and Going Concern Uncertainty

As of January 31, 2003, the Company had approximately $11.2
million of cash and cash equivalents, working capital of $2.9
million and had incurred losses since inception resulting in an
accumulated deficit of $366.9 million. NaviSite's operations
prior to September 11, 2002 had been funded primarily by CMGI
through the issuance of common stock, preferred stock and
convertible debt to strategic investors, the Company's initial
public offering during fiscal 2000 and related exercise of an
over-allotment option by the underwriters in November 1999.
Prior to the acquisition by NaviSite of CBTM on December 31,
2002, CBTM had been funded primarily by its parent company,
ClearBlue, through various private investors. For the year ended
July 31, 2002, consolidated cash flows used for operating
activities totaled $27 million and for the six months ended
January 31, 2003 and 2002 consolidated cash flows used for
operating activities totaled $5.1 million and $16.5 million,
respectively.

During the six months ended January 31, 2003, the Company's cash
and cash equivalents decreased by approximately $10.6 million.
Included in this change was approximately $6.8 million in net
cash expenditures that are non-recurring in nature. The $6.8
million in net non-recurring expenditures consists predominantly
of: 1) a $3.2 million payment to CMGI for the settlement of
intercompany balances reached in fiscal year 2002; 2) a $2.0
million purchase of a debt interest in Interliant, Inc.; 3) a
$1.3 million interest payment to ClearBlue related to the $65
million of convertible notes then outstanding (see note 8 for
ClearBlue waiver of interest from December 12, 2002 through
December 31, 2003); 4) a $770,000 payment to purchase directors
and officer's insurance for periods prior to September 11, 2002;
5) a $775,000 unsecured loan to ClearBlue for payroll related
costs; 6) $1.3 million in severance payments; 7) a $600,000
settlement payment with Level 3, Inc.; 8) a $490,000 prepayment
of directors' and officers' insurance; 9) $403,000 in bonuses
related to fiscal year 2002 and 10) a $100,000 payment on behalf
of ClearBlue for legal costs; partially offset by: 1) $2.5
million in customer receipts; 2) a $1.0 million receipt from
Engage Technologies, Inc. related to a fiscal year 2002
settlement; and 3) a $637,000 reduction in restricted cash due
to the decrease in our line of credit.

The Company currently anticipates that its available cash at
January 31, 2003 combined with the additional funds available,
at Atlantic's sole discretion, under the Loan and Security
Agreement between NaviSite and Atlantic, (approximately $5.3
million at February 28, 2003), will be sufficient to meet our
anticipated needs, barring unforeseen circumstances for working
capital and capital expenditures through the end of fiscal year
2003. However, based on our current projections for fiscal year
2004, we will have to raise additional funds to remain a going
concern. The Company's projections for cash usage for the
remainder of fiscal year 2003 are based on a number of
assumptions, including: (1) its ability to retain customers in
light of market uncertainties and the Company's uncertain
future; (2) its ability to collect accounts receivables in a
timely manner; (3) its ability to effectively integrate recent
acquisitions and realize forecasted cash-saving synergies and
(4) its ability to achieve expected cash expense reductions. In
addition, the Company is actively exploring the possibility of
additional business combinations with other unrelated and
related business entities. ClearBlue and its affiliates
collectively own a majority of the Company's outstanding common
stock and could unilaterally implement any such combinations.
The impact on the Company's cash resources of such business
combinations cannot be determined. Further, the projected use of
cash and business results could be affected by continued market
uncertainties, including delays or restrictions in IT spending
and any merger or acquisition activity.

To address these uncertainties, management is working to: (1)
quantify the potential impact on cash flows of its evolving
relationship with ClearBlue and its affiliates; (2) continue its
practice of managing costs; (3) aggressively pursue new revenue
through channel partners, direct sales and acquisitions and (4)
raise capital through third parties.

The Company may need to raise additional funds in order respond
to competitive and industry pressures, to respond to operational
cash shortfalls, to acquire complementary businesses, products
or technologies, or to develop new, or enhance existing,
services or products. In addition, on a long-term basis, the
Company may require additional external financing for working
capital and capital expenditures through credit facilities,
sales of additional equity or other financing vehicles. Its
ability to raise additional funds may be negatively impacted by:
(1) the uncertainty surrounding its ability to continue as a
going concern; (2) the potential de-listing of the Company's
common stock from NASDAQ; (3) its inability to transfer back to
the NASDAQ National Market in the future from the NASDAQ
SmallCap Market; and (4) restrictions imposed on the Company by
ClearBlue and its affiliates. Under our arrangement with
ClearBlue, the Company must obtain ClearBlue's consent in order
to issue debt securities or sell shares of its common stock to
affiliates, and ClearBlue might not give that consent. If
additional funds are raised through the issuance of equity or
convertible debt securities, the percentage ownership of the
Company's stockholders will be reduced and its stockholders may
experience additional dilution. There can be no assurance that
additional financing will be available on terms favorable to the
Company, if at all. If adequate funds are not available or are
not available on acceptable terms, the Company's ability to fund
its expansion, take advantage of unanticipated opportunities,
develop or enhance services or products or respond to
competitive pressures would be significantly limited and,
accordingly, the Company might not continue as a going concern.


NETROM INC: Tempest Taps Trillion-Dollar Euro Financial Market
--------------------------------------------------------------
Netrom, Inc., (OTC:NRRM) announced that its newly acquired
Tempest Asset Management, Inc., opened a currency trading center
in Zurich, Switzerland to gain access to the multi-trillion
dollar financial markets in Europe.

This operation will be headed by Mr. Silvano De Col, who left
Credit Suisse last week to join Tempest as its Vice President
and Chief Currency Dealer for Europe. Tempest's Chief Executive
Officer, Chris Melendez, says, "Tempest was very fortunate to be
able to recruit Mr. De Col from Credit Suisse, where he was a
Senior Vice President. He has a great track record and is highly
regarded in the European banking community."

At Credit Suisse, Mr. De Col led the effort to modernize their
dealing room, which became one of the most sophisticated, state-
of-the-art trading floors in all of Switzerland. He profitably
managed their Dollar/Swiss Franc trading for nearly eight years.
He and his team executed daily trades in excess of a billion
Swiss Francs. Mr. De Col began his career in 1985 at Swiss Bank
Corporation, Zurich where he learned the craft of currency
trading from some of the leading bankers and traders in Europe.

Melendez further added, "This is a significant milestone that
gives Tempest a strong presence in Europe, the foreign currency
trading capital of the world. It will enable us to execute
better trades and accelerate our growth by giving us access to
major new sources of trading capital."

Netrom, Inc. (OTC:NRRM), headquartered in San Diego, was founded
in 1996. Since its inception, Netrom has been involved in the
development of technologies that are related to the Internet, as
well as developing new eBusiness models. In the first quarter of
2000 Netrom became insolvent and was forced into a major
reorganization. The company has been in the process of a
turnaround of its business with the primary objectives being to
restructure its debt, restore trading of its stock to the OTC BB
and grow the company through strategic acquisitions.

Tempest Asset Management, Inc. is a development stage California
corporation headquartered in Irvine, California. The company
provides institutional grade, Forex trading products and
services to individual investors. "Forex" is a term that refers
to the Foreign Currency Exchange Market where a trader
simultaneously buys one currency and sells another for profit,
which is not dependent on the market conditions of stocks, bonds
or commodities. The Company was founded in 2001 by Chris
Melendez, its CEO and internationally renowned Forex trader. He
gained his expertise as a "market maker and proprietary currency
trader" at major financial institutions around the world. For
additional information visit http://www.tempestasset.com

As previously reported, Netrom has spent the last six months
restructuring the Company and seeking a suitable candidate for
an acquisition.


NORTEL NETWORKS: Shareholders Okay Proposed Share Consolidation
---------------------------------------------------------------
Nortel Networks Corporation (NYSE:NT)(TSX:NT) announced that at
a meeting held in Ottawa, Ontario, its shareholders had given
authority to its board of directors to  effect a consolidation,
also known as a reverse stock split, of all of the issued and
outstanding common shares of the company. The company's board of
directors has the authority to implement the consolidation at
any time prior to April 15, 2004 and to choose a consolidation
ratio between one post-consolidation share for every five pre-
consolidation shares and one post-consolidation share for every
ten pre-consolidation shares. The board of directors may also
choose, in its sole discretion, not to proceed with the
consolidation.

The company's shareholders also approved the reconfirmation of,
and certain amendments to, the company's Shareholder Rights
Plan. The amended and restated Shareholder Rights Plan will
expire at the annual meeting of shareholders to be held in 2006
unless it is reconfirmed in accordance with the plan at that
time.

Nortel Networks is an industry leader and innovator focused on
transforming how the world communicates and exchanges
information. The company is supplying its service provider and
enterprise customers with communications technology and
infrastructure to enable value-added IP data, voice and
multimedia services spanning Wireless Networks, Wireline
Networks, Enterprise Networks and Optical Networks. As a global
company, Nortel Networks does business in more than 150
countries. More information about Nortel Networks can be found
on the Web at http://www.nortelnetworks.com

                         *   *   *

As reported in the Troubled Company Reporter's Nov. 6, 2002,
issue, Moody's Investors Service lowered the senior secured and
senior implied ratings on the securities of Nortel Networks
Corp., and its subsidiaries to B3 and Caa3 from Ba3 and B3
respectively.

Outlook is negative.

The rating action reflects the lack of Nortel's financial
flexibility and the decline of its revenue base. The downgrade
also takes into account the company's planned lapse of its $1.5
billion in credit facilities due on December. However the rating
action is offset by its substantial cash, modest near-term debt
maturities, and the progress the company has made in
streamlining its expenses.


NORTEL NETWORKS: Will Pay Preferred Dividends on June 12, 2003
--------------------------------------------------------------
The board of directors of Nortel Networks (NYSE:NT) (TSX:NT.TO)
Limited declared a dividend on each of the outstanding
Cumulative Redeemable Class A Preferred Shares Series 5 (TSX:
NTL.PR.F) and the outstanding Non-cumulative Redeemable Class A
Preferred Shares Series 7 (TSX: NTL.PR.G), the amount of which
for each series will be calculated by multiplying (a) the
average prime rate of Royal Bank of Canada and Toronto-Dominion
Bank during May 2003 by (b) the applicable percentage for the
dividend payable for such series for April 2003 as adjusted up
or down by a maximum of 4 percentage points (subject to a
maximum applicable percentage of 100 percent) based on the
weighted average trading price of the shares of such series
during May 2003, in each case as determined in accordance
with the terms and conditions of such series. The dividend on
each series is payable on June 12, 2003 to shareholders of
record of such series at the close of business on May 30, 2003.

Nortel Networks is an industry leader and innovator focused on
transforming how the world communicates and exchanges
information. The company is supplying its service provider and
enterprise customers with communications technology and
infrastructure to enable value-added IP data, voice and
multimedia services spanning Wireless Networks, Wireline
Networks, Enterprise Networks and Optical Networks. As a global
company, Nortel Networks does business in more than 150
countries. More information about Nortel Networks can be found
on the Web at www.nortelnetworks.com.

Nortel Networks Ltd.'s 6.125% bonds due 2006 (NT06CAN1) are
trading at about 98 cents-on-the-dollar, says DebtTraders. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=NT06CAN1for
real-time bond pricing.


OLYMPIC PIPE LINE Bucknell Stehlik Serves as Bankruptcy Counsel
---------------------------------------------------------------
Olympic Pipe Line Company, seeks permission from the U.S.
Bankruptcy Court for the Western District of Washington to
employ Bucknell Stehlik Sato & Stubner, LLP as its bankruptcy
counsel.

The professional services that Bucknell Stehlik will render to
the Debtor include:

      a. giving the debtor legal advice with respect to its
         powers and duties as debtor in possession in the
         continued operation of its business and management of
         its property;

      b. advising the debtor with respect to the formulation of a
         plan of reorganization and the exercise of avoidance and
         other powers granted under Title 11, U.S.C.;

      c. preparing on behalf of the debtor as debtor in
         possession all necessary applications, answers, orders,
         reports, and other legal papers; and

      d. performing any and all other legal services for the
         debtor as debtor in possession which may be necessary
         herein.

The engagement will be lead by Thomas N. Bucknell, Esq., whose
hourly billing rate is $315.  Other professionals who may render
services to the Debtor have current hourly rates ranging from
$225 to $315.

Olympic Pipe Line Company, owns and operates a pipeline system
transporting finished Petroleum products.  The Company filed for
chapter 11 protection on March 27, 2003 (Bankr. W.D. Wash. Case
No. 03-14059).  Edwin K. Sato, Esq., and Thomas N. Bucknell,
Esq., at Bucknell Stehlik Sato & Stubner, LLP represent the
Debtors in their restructuring efforts.  When the Company filed
for protection from its creditors, it listed $105,961,773 in
total assets and $401,856,113 in total debts.


ON COMMAND: Bank Lenders Agree to Amend & Restate Credit Pact
-------------------------------------------------------------
Information obtained from http://www.LoanDataSource.comshows
that On Command Corporation is the borrower under a $235,000,000
Amended and Restated Credit Agreement dated as of April 17,
2003, with a consortium of Lenders comprised of:

           THE BANK OF NEW YORK COMPANY, INC.
           One Wall Street-16th Floor
           New York, New York 10286
           Attention: Mr. Stephen M. Nettler
           Telephone: (212) 635-8699
           Telecopy: (212) 635-8595

           TORONTO DOMINION (TEXAS), INC.
           909 Fannin Street-Suite 1700
           Houston, Texas 77010
           Attn: Ms. Diana Jugon
           Telephone: (713) 653-8258
           Telecopy: (713) 951-9921

           FLEET NATIONAL BANK
           100 Federal Street
           Mail Stop: MADE10009B
           Boston, Massachusetts 02110
           Attn: Ms. Janis McWhirk
           Telephone: (617) 434-5462
           Telecopy: (617) 434-8277

           BANK OF AMERICA, N.A.
           335 Madison Avenue-5th Floor
           New York, New York 10017
           Attn: Mr. James T. Gilland
           Telephone: (212) 503-7648
           Telecopy: (212) 503-7173

           MIZUHO CORPORATE BANK, LTD.
           1251 Avenue of the Americas-32nd Floor
           Account Management No. 1
           New York, New York 10020-1104
           Attn: Mr. Dan Guevara
           Telephone: (212) 282-4537
           Telecopy: (212) 282-9705

           U.S. BANK NATIONAL ASSOCIATION
           918 Seventeenth Street-4th Floor
           DN-CO-BB4A
           Denver, Colorado 80202
           Attn: Mr. Kenneth D. Brown
           Telephone: (303) 585-4202
           Telecopy: (303) 585-6935

           CREDIT LYONNAIS NEW YORK BRANCH
           Credit Lyonnais Building
           1301 Avenue of the Americas
           New York, New York 10019-6022
           Attn: Mr. Douglas Roper
           Telephone: (212) 261-7841
           Telecopy: (212) 261-3288

           BNP PARIBAS
           787 Seventh Avenue-33rd Floor
           New York, New York 10019
           Attn: Mr. Charles Romano
           Telephone: (212) 841-2968
           Telecopy: (212) 841-2996

           THE BANK OF NOVA SCOTIA
           One Liberty Plaza
           New York, New York 10006
           Attn: Mr. Jonathan Silsby
           Telephone: (212) 225-5230
           Telecopy: (212) 225-5090

The closing of the Amended and Restated Credit Agreement is
contingent upon the receipt by the Company prior to June 30,
2003, of a $40 million contribution from Liberty Media
Corporation (NYSE: L, LMC.B) to be used to repay principle due
under the Credit Agreement and to permanently reduce lender
commitments. However, Liberty has no obligation to make any
capital contribution to the Company, there can be no assurances
that any such contribution will be made, and the terms of any
such contribution (including the securities or other
consideration to be received by Liberty in exchanges for such
contribution) have not yet been agreed upon.

After the proposed reduction of lender commitments, the Amended
and Restated Credit Agreement will constitute a $235 million
senior secured credit facility, consisting of a $50 million
revolving credit facility and a $185 million term loan facility.
The term loan will be subject to scheduled amortizations
commencing September 30, 2003, and both facilities will mature
on December 31, 2007.

Under the Company's existing Credit Agreement, as amended most
recently in March 2003, the Company is currently subject to a
maximum leverage ratio of 4.25, which is scheduled to step down
to a maximum of 3.50 on June 30, 2003.  At March 31, 2003, the
Company's actual leverage ratio was 4.0.  Accordingly, although
the Company was in compliance with the leverage ratio covenant
under the Credit Agreement at March 31, 2003, it believes that
it will be out of compliance with such covenant on June 30,
2003, if the closing under the Amended and Restated Credit
Agreement does not occur prior to that date.  If such closing
does occur, however, the Company believes that it will be able
to maintain compliance with all of its covenants under the
Amended and Restated Credit Agreement, including without
limitation the maximum leverage ratio of 3.90 at June 30, 2003,
scheduled to step down to maximums of 3.75 at October 1, 2003,
and 3.50 at January 1, 2004.

If the Amended and Restated Credit Agreement has not closed by
June 29, 2003, the Company anticipates that it will request a
further amendment to its current Credit Agreement to postpone
the stepdown of the leverage ratio. It is uncertain as to
whether the Company's lenders would agree to such a further
amendment and what terms might be imposed by the Company's
lenders in connection with such further amendment.

Steven D. Miller, Esq., at Sherman & Howard L.L.C., in Denver,
Colorado, provides legal advice to On Command.

On Command Corporation -- http://www.oncommand.com-- is a
leading provider of in-room entertainment technology to the
lodging and cruise ship industries. On Command is a majority-
owned subsidiary of Liberty Satellite & Technology, Inc. (OTC
Bulletin Board: LSTTA, LSTTB).

On Command entertainment services include: on-demand movies;
television Internet services using high-speed broadband
connectivity; television email; short form television features
covering drama, comedy, news and sports; PlayStation video
games; and music-on-demand services through Instant Media
Network, a majority-owned subsidiary of On Command Corporation
and the leading provider of digital on-demand music services to
the hotel industry. All On Command products are connected to
guest rooms and managed by leading edge video-on-demand
navigational controls and a state-of-the art guest user
interface system. The guest menu system can be customized by
hotel properties to create a robust platform that services the
needs of On Command hotel partners and the traveling public. On
Command and its distribution network services more than
1,000,000 guest rooms, which touch more than 300 million guests
annually.

On Command's direct served hotel properties are located in the
United States, Canada, Mexico, Spain, and Argentina. On Command
distributors serve cruise ships operating under the Royal
Caribbean, Costa and Carnival flags. On Command hotel properties
include more than 100 of the most prestigious hotel chains and
operators in the lodging industry: Accor, Adam's Mark Hotels &
Resorts, Fairmont, Four Seasons, Hilton Hotels Corporation,
Hyatt, Loews, Marriott (Courtyard, Renaissance, Fairfield Inn
and Residence Inn), Radisson, Ramada, Six Continents Hotels
(Inter-Continental, Crowne Plaza and Holiday Inn), Starwood
Hotels & Resorts (Westin, Sheraton, W Hotels and Four Points),
and Wyndham Hotels & Resorts.


OWENS-BROCKWAY: S&P Assigns BB/B+ Ratings to $800-Mil. Sr Notes
---------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB' rating to
Owens-Brockway Glass Container Inc.'s $450 million senior
secured notes due 2011. At the same time, Standard & Poor's
assigned its 'B+' rating to Owens-Brockway Glass Container
Inc.'s $350 million senior unsecured notes due 2013.

Owens-Brockway is wholly owned subsidiary of Toledo, Ohio-based
Owens-Illinois Inc. Standard & Poor's said that it has affirmed
its ratings, including its 'BB' corporate credit rating, on
Owens-Illinois Inc. and its related entities. The outlook
remains negative. Proceeds of the proposed notes offerings will
be used to permanently reduce the company's revolving credit
facility and repurchase Owens-Illinois Inc.'s $300 million
senior notes due March 2004. Total debt outstanding was about
$5.4 billion as at Dec. 31, 2002.

"The ratings on Owens-Illinois Inc. and its related entities
reflect the company's aggressive financial profile and
meaningful concerns regarding its asbestos liability, offset by
an above-average business position and strong EBITDA
generation," said Standard & Poor's credit analyst Paul Vastola.
Owens-Illinois' above-average business risk profile incorporates
the company's preeminent market positions, which are bolstered
by superior production technology, operating efficiency, and the
relatively recession-resistant nature of many of its packaging
products.


OWENS CORNING: Asks Court to Establish Asbestos Claims Bar Date
---------------------------------------------------------------
Christopher M. Winter, Esq., at Morris, Nichols, Arsht &
Tunnell, in Wilmington, Delaware, recounts that the Official
Committee of Unsecured Creditors in the Chapter 11 cases of
Owens Corning and its debtor-affiliates filed a pleading stating
that a bar order for asbestos personal injury claims was
necessary and would be required at a later time.  The Court
agreed on the record.  The Debtors' counsel then told the Court:

      "We will get together with the major constituents and
      see if we can reach agreement on a[n asbestos] bar date
      motion and a form of a proof of claim and all the
      exhibits that would go with that. And if we can't,
      we'll come back to the Court. And if we can, we'll
      submit a consensual motion and order to the Court."

Mr. Winter reports that the Debtors never attempted to discuss
these two issues with the Commercial Committee.  By e-mail dated
February 7, 2003 to counsel for the Debtors, the Committee's
counsel, quoting the promise, asked whether, and, if so, when,
the Debtors intended to approach the Committee.  No response was
received until after Judge Wolin's February 19, 2003 Memorandum
Opinion and Order In re USG Corporation.  The Debtors' counsel
indicated they would get back to the Committee's counsel.  But
still they have not.  Moreover, the Disclosure Statement filed
with the Cramdown Plan mentions a planned administrative-claims
bar date but not an asbestos personal injury/wrongful death bar
date.

Accordingly, the Committee asks the Court to establish a bar
date for filing proofs of claim for all personal-injury and
wrongful-death claims for conditions which:

     1. are diagnosable before the Bar Date;

     2. have allegedly been caused by exposure to asbestos; and

     3. are asserted or assertable against any one or more of:

        a. Owens Corning; or

        b. Fiberboard; or

        c. any one or more of their Debtor subsidiaries.

The Committee also want Judge Fitzgerald to establish the form
and requirements for the proofs of claims and direct the Debtors
to take all necessary actions to effectuate notice of the bar
date and the processing of claims.

The Committee argues that:

     A. An Asbestos Bar Order is mandatory and necessary because:

        1. the Bankruptcy Rules require a Bar Order;

        2. there are no alternatives in this Case to an Asbestos
           Personal-Injury/Wrongful-Death Bar Order; and

        3. absent a Consensual Plan, confirmation without a prior
           Bar Order would be unlawful; and

     B. The Bar Order must require that Asbestos Claimants file
        appropriately detailed proofs of claim. (Owens Corning
        Bankruptcy News, Issue No. 50; Bankruptcy Creditors'
        Service, Inc., 609/392-0900)


PACIFIC GAS: Seeks Go-Ahead for United Services Settlement Pact
---------------------------------------------------------------
On November 16, 2000, United Services Automobile Association
filed a civil action before the San Francisco Superior Court,
alleging that Pacific Gas and Electric Company's belated
discovery and repair of a gas leak forced it to perform
extensive remediation and expend $600,000.  United Services
complained that a longstanding, major leak in a PG&E gas
distribution main caused large amounts of gas to accumulate
under and around the United Services building in Sacramento,
which includes a day care center.  United Services explained
that, in 1996, its employees and visitors began to complain of
gas odors in their building. Hence, United Services was forced
to hire a gas consultant who concluded that the source of the
odors was gas leaking from the PG&E gas distribution main
adjacent to the building.  PG&E employees had initially
erroneously concluded that there were no leaks from the gas
distribution main.

When United Services reported combustible levels of gas inside
the building, PG&E tested and discovered what it characterized
as a small leak in the distribution main, which it patched.  But
the patch did not stop the leaking and PG&E was required to
replace the entire gas distribution main adjacent to United
Services' building.  It took until May 31, 1997 to stop the
leak.

By that time, United Services spent $600,000 to analyze, monitor
and extract all of the gas from, in, under and around its
building.  United Services' real estate expert has opined that
the building's history of gas intrusion creates a stigma that
would diminish the ultimate sale price of the building by more
than $12,000,000.

United Services also filed Proof of Claim No. 8056 for
$2,600,000 on account of the damages.

Eventually, PG&E and United Services engaged in arm's-length
discussions to settle the issue.  In a court-approved settlement
agreement, United Services agreed to dismiss the civil action
against PG&E with prejudice in consideration of the allowance of
its Claim for $600,000.  PG&E will treat the Claim like all
other similar, allowed, unsecured, non-priority tort claim in
its bankruptcy case. (Pacific Gas Bankruptcy News, Issue No. 56;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


P.D.C. INNOVATIVE: Shoos Away Margolies Fink as Accountants
-----------------------------------------------------------
On April 14, 2003, P.D.C. Innovative Industries, Inc. advised
its certifying accountant for the fiscal years ended
December 31, 2001 and December 31, 2000, Margolies, Fink and
Wichrowski that the Company's Board of Directors had decided to
dismiss the firm as of that date and to engage Salberg &
Company, P.A., as of that date, as P.D.C.'s certifying
accountant for the fiscal year ending December 31, 2002. Such
decision was approved by the Company's Board of Directors.

The company's total shareholders' equity deficit as of
Sept. 30, 2002, is reported at about $227,277.


PERSONNEL GROUP: Amends Rights Agreement for Preferred Shares
-------------------------------------------------------------
On February 6, 1996, the Board of Directors of Personnel Group
of America, Inc. declared a dividend of one preferred share
purchase right for each outstanding share of common stock, par
value $0.01 per share, of the Company, payable to its
stockholders of record as of February 27, 1996.  Since the
Record Date, the Company has issued one Right with each newly
issued share of common stock. The terms of the Rights were
amended on December 13, 2001, March 14, 2003, and April 14,
2003.

The description and terms of the Rights are set forth in a
Rights Agreement, originally dated February 6, 1996, between the
Company and The First National Bank of Boston, as rights agent,
as amended by a First Amendment to Rights Agreement, dated
December 13, 2001, between the Company and Wachovia Bank,
National Association (formerly known as First Union National
Bank), as successor rights agent, by a Second Amendment to
Rights Agreement, dated March 14, 2003, between the Company and
the Rights Agent, and by an Amended and Restated Rights
Agreement, dated April 14, 2003, between the Company and the
Rights Agent.

At December 29, 2002, the Company's balance sheet shows a total
shareholders' equity deficit of about $52 million (a positive
$52 million, after pro forma adjustments).


POLAROID: Examiner Sets-Up 3rd-Party Document Access Procedures
---------------------------------------------------------------
Laura Davis Jones, Esq., at Pachulski, Stank, Ziehl, Young,
Jones & Weintraub P.C., in Wilmington, Delaware, relates that
after prior consultation with the Producing Parties and other
parties-in-interest, including the shareholders and the Office
of the U.S. Trustee, the Examiner for the Chapter 11 cases of
the Polaroid Corporation Debtors, Perry M. Mandarino has devised
a procedure regarding access by third parties to the Documents
he obtained during the course of his Examination.  Mr. Mandarino
has previously circulated the Protocol to various parties-in-
interest and they have made comments thereto.  Mr. Mandarino
accordingly incorporated many of the comments he received into
the revised Protocol.

The Protocol has these basic provisions:

A. The Protocol requires each Producing Party to, simultaneously
     with the Documents produced, provide a summary and index
     thereof.  In the event, a Producing Party deems any Document
     as privileged, it is required to produce a privilege log in
     compliance with Rule 45(d)(2) of the Federal Rules of Civil
     Procedure.  In addition, pursuant to the Protocol, within
     five business days of receipt of the Documents or a
     privilege log, the Examiner will provide to all parties-in-
     interest the summary and index and any privilege log that is
     produced.  A Requesting Party seeking access to Documents
     that have been produced to the Examiner is required to
     deliver a Request Notice to the Examiner and the Producing
     Party.  The Protocol permits the Producing Party to object
     to any Request Notice. The Examiner will not provide access
     to any Request Party unless all objections to their Request
     Notice are resolved by stipulation or a Court order.
     Moreover, the Examiner has agreed that he will not produce
     any Protected Material unless and until the Producing Party
     agrees in writing to the production or this Court enters an
     order requiring the disclosure;

B. The Protocol also provides a mechanism for the Examiner to
     conduct depositions in the most efficient, expeditious and
     economical means.  The Examiner has no obligation to consult
     with any party prior to scheduling a deposition; however,
     the Examiner has agreed to file a notice of each deposition.
     The Protocol limits attendance to any deposition to
     Representatives of groups identified therein.  In addition,
     no person or party other than the Examiner or the deponent
     can ask questions or make objections during any depositions
     being conducted by or on behalf of the Examiner.
     Representatives of certain parties-in-interest are
     authorized to submit written questions to the Examiner in
     advance of each deposition.  The Examiner may or may not, at
     his sole discretion, ask the submitted questions.
     Deposition transcripts will be made party of the public
     record unless they are marked confidential; and

C. The Protocol does not preclude any person from conducting its
     own discovery.  However, the Protocol places restrictions
     upon each Requesting Party, that receives Documents from the
     Examiner, from purchasing, selling or otherwise trading in
     the debt or stock of the Debtors or OEP Imaging Corporation,
     unless the conduct is authorized by other Court orders.

Ms. Jones points out that it is essential for the Examiner to
conduct his Examination in the most expeditious, efficient and
economical means possible.  The Protocol provides a mechanism
pursuant to which:

     (a) the Examiner may obtain Documents expeditiously;

     (b) Requesting Parties may obtain Documents; and

     (c) confidential privileged Documents are protected.

Accordingly, Mr. Mandarino sought and obtained Court approval of
the Protocol for third parties to access the documents he
obtained, and depositions conducted during the course of his
examination pursuant to Rule 2004 of the Federal Rules of
Bankruptcy Procedure. (Polaroid Bankruptcy News, Issue No. 36;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


PRUDENTIAL STRUCTURED: S&P Keeps Watch on Low-B Class B Ratings
---------------------------------------------------------------
Standard & Poor's Ratings Services placed the class A-1L, A-1,
A-2L, B-1L, B-1, B-2L, and B-2 notes issued by Prudential
Structured Finance CBO I, an arbitrage CDO of ABS transaction,
on CreditWatch with negative implications.

The CreditWatch placements reflect factors that have negatively
affected the credit enhancement available to support the rated
notes and concerns over exposure to bonds issued by Manufactured
Housing ABS transactions. According to the most recent trustee
report (April 4, 2003), the Standard & Poor's rating percentage
for assets rated 'BB-' and above has fallen by more than 400
basis points within the last month and is at 80.41%, versus the
minimum required 90%.

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

                RATINGS PLACED ON CREDITWATCH NEGATIVE

                 Prudential Structured Finance CBO I

                         Rating            Current
           Class   To              From    Balance (mil. $)
           A-1L    A+/Watch Neg     A+               175.0
           A-1     A+/Watch Neg     A+                70.0
           A-2L    BBB-/Watch Neg   BBB-              20.0
           B-1L    BB-/Watch Neg    BB-                8.0
           B-1     BB-/Watch Neg    BB-                4.2
           B-2L    B-/Watch Neg     B-                 5.0
           B-2     B- /Watch Neg    B-                 2.5


PUTNAM CBO: Fitch Further Junks 2nd Priority Sr Sec. Notes to C
---------------------------------------------------------------
Fitch Ratings has downgraded the following classes of notes
issued by Putnam CBO II, Limited:

-- $212,134,191.52 Senior Secured Fixed-Rate Notes to 'BBB+'
    from 'AA';

-- $70,301,264.03 Second Priority Senior Secured Fixed-Rate
    Notes to 'C' from 'CC'.

Putnam CBO II, Limited is a collateralized bond obligation (CBO)
managed by Putnam Investment Management. The CBO was established
in November 1997 to issue debt and equity securities and to use
the proceeds to purchase high yield bond collateral.

According to the March 20, 2003 trustee report, Putnam CBO II,
Limited's collateral includes a par amount of $14.25 million
(5.8%) in defaulted assets. The transaction's senior par value
ratio test is failing at 117.9% with a trigger of 130% and the
second priority par value ratio test is failing at 88.53% with a
trigger of 106.5%. The weighted average rating factor has
improved from its peak of 70.26 ('B-'/'CCC+') on January 2002
and is currently at 62.69 ('B/'B-'). After discussing the
performance of Putnam CBO II with Putnam Investment Management,
Fitch recognizes that there has been some improvement in the
credit quality of the portfolio and believes that the collateral
manager will continue making efforts to improve the quality of
the portfolio.

In reaching these rating decisions, Fitch conducted cash flow
model runs utilizing several default and interest rate stress
scenarios. Fitch will continue to monitor this transaction and
the accuracy of the ratings. Deal information and historical
performance data for this transaction is available on Fitch's
subscription website, www.fitchresearch.com.


QWEST COMMS: Names John W. Richardson Controller & SVP-Finance
--------------------------------------------------------------
Qwest Communications International Inc. (NYSE: Q) announced the
appointment of John W. Richardson as controller and senior vice
president of finance. Richardson will report directly to Oren G.
Shaffer, Qwest's CFO and vice chairman.

Richardson spent more than 30 years in various financial
positions at the Goodyear Tire & Rubber Company, most recently
as vice president of finance for the North American Tire
business unit, Goodyear's largest business unit. Goodyear has
approximately 100,000 employees and reported 2002 revenues of
nearly $14 billion.

"John brings experience from all facets of financial operations
to Qwest," said Shaffer. "We expect his leadership will help
Qwest tremendously as we focus our business on profitable
revenue growth."

Richardson is very active in the community, and is a trustee and
treasurer of the Greater Akron Chamber of Commerce, trustee and
past treasurer of the Akron Metropolitan YMCA, and is a member
of the Ohio University School of Accountancy Advisory Board.

Qwest Communications International Inc., (NYSE: Q) is a leading
provider of voice, video and data services to more than 25
million customers. The company's 50,000-plus employees are
committed to the "Spirit of Service" and providing world-class
services that exceed customers' expectations for quality, value
and reliability. For more information, please visit the Qwest
Web site at http://www.qwest.com

Qwest Communications' 7.500% bonds due 2008 (Q08USR3) are
trading at about 92 cents-on-the-dollar, says DebtTraders. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=Q08USR3for
real-time bond pricing.


QWEST COMMS: Wins Grubb & Ellis' Network Services Contract
----------------------------------------------------------
Qwest Communications International Inc. (NYSE: Q) has been
awarded a multi- year data communications services agreement
from Grubb & Ellis, one of the world's leading providers of
integrated real estate services.

Qwest will supply Grubb & Ellis with virtual private network
connections among its offices throughout the country. VPN
services link businesses with multiple locations via a high-
speed, low-cost private connection. Qwest also will provide
management services for Grubb & Ellis' VPN.

"We were looking to replace our frame relay network with a
wider-reaching VPN and Qwest provided the one-stop network and
management solution we were seeking," said Lyndal Hanna, senior
vice president, Information Technology, Grubb & Ellis. "We were
searching for a cost-effective, leading-edge data network -- and
Qwest delivered."

"Qwest is proving to the marketplace that 'Spirit of Service' is
more than a tagline in advertisements," said Clifford Holtz,
Qwest executive vice president for global business markets.
"Qwest prides itself on offering tailor-made network services,
but we also recognize our customers need to know that their
communications service provider will be there to ensure best-in-
class customer care. That's what we're all about."

The foundation for Qwest's communications service offerings is
its 170,000-plus-mile global broadband network, which provides a
platform for a wide spectrum of services, including Qwest's
comprehensive selection of Web- enabled applications and managed
solutions, such as Web hosting, storage, content distribution,
applications and virtual private network services.

Qwest Communications International Inc. (NYSE: Q) is a leading
provider of voice, video and data services to more than 25
million customers. The company's 50,000-plus employees are
committed to the "Spirit of Service" and providing world-class
services that exceed customers' expectations for quality, value
and reliability. For more information, visit the Qwest Web site
at http://www.qwest.com

With access to collective resources of more than 8,000 people in
over 200 offices in 31 countries, Grubb & Ellis is one of the
world's leading providers of integrated real estate services.
The company provides a full range of real estate services,
including transaction, management and consultative services, to
users and investors worldwide through its domestic offices and
affiliates, global strategic alliance with Knight Frank, one of
the leading property consulting firms in Europe, Africa and Asia
Pacific, and with Canada's Avison Young. For more information,
visit the company's Web site at http://www.grubb-ellis.com

Qwest Communications' December 31, 2002 balance sheet shows a
working capital deficit of about $1.2 billion, and a total
shareholders' equity deficit of about $1 billion.


REVLON INC: March 31 Balance Sheet Upside-Down by $1.7 Billion
--------------------------------------------------------------
Revlon, Inc. (NYSE: REV) announced results for the first quarter
ended March 31, 2003.

The Company indicated that steady progress continues to be made
against its comprehensive growth plan, including solid growth in
sales and continued improvements in marketplace performance. For
the quarter, the Company again registered color cosmetics market
share growth versus year-ago, with both the Revlon and Almay
brands posting share increases.

Commenting on the quarter, Revlon President and Chief Executive
Officer Jack Stahl stated, "The first quarter marked another
period of solid progress for Revlon. As we continue to implement
our growth plan, we are maintaining the critical traction in the
marketplace that we established in the back half of last year,
building on an intensifying focus on our brands, our customers
and our people. Our growth plan remains on track, and we are
confident in our ability to execute effectively to drive
improved results as we move forward."

The Company's growth plan involves increasing the effectiveness
of its advertising and promotional spending, increasing the
effectiveness of its in-store wall displays, discontinuing
select products and adjusting prices on several others, further
strengthening the new product development process, and investing
in training and development for its people. During the quarter,
Revlon indicated that it incurred expenses (excluding brand
support expenses or any training and development costs) of
approximately $11 million associated with implementing its
growth plan. The Company further indicated that it continues to
expect its growth plan and related actions will result in
charges of up to $160 million, $115 million of which has been
recognized to date.

As previously disclosed, on February 5, 2003, Revlon entered
into an investment agreement with MacAndrews & Forbes, including
a $100 million term loan from MacAndrews & Forbes, a $50 million
rights offering that MacAndrews & Forbes will back, and a $40
million line of credit from MacAndrews & Forbes for 2003 that
increases to $65 million in 2004.

In connection with the SEC's new Regulation G, which recently
became effective, the Company will only be presenting its
financial results on a GAAP basis and will not be also
presenting its financial results on an ongoing operations basis,
which is a non-GAAP measure previously reported by the Company.
Revlon will continue to report Adjusted EBITDA(1), which the
Company defines as net earnings before interest, taxes,
depreciation, amortization, gains/losses on foreign currency
transactions, gains/losses on the sale of assets, and
miscellaneous expenses. The Company indicated that Adjusted
EBITDA is a non-GAAP measure most directly comparable to cash
flow from operating activities and net earnings/loss, depending
upon its use. The Company's definition of Adjusted EBITDA, which
is discussed in more detail in the footnotes of this release and
which is reconciled to its most directly comparable GAAP
measures in the accompanying financial tables, may differ from
that of other companies.

                     First Quarter Results

Net sales in the first quarter of 2003 advanced 6% to $292
million, compared with net sales of $275 million in the first
quarter of 2002. The increase in sales was driven by growth in
both North America and International, despite provisions for
higher returns and allowances associated with implementing the
Company's growth plan.

In North America, net sales grew 4% to $205 million, versus $196
million in the first quarter of 2002, primarily driven by strong
growth in color cosmetics and, to a lesser extent, hair color,
partially offset by lower sales from implements and anti-
perspirants/deodorants. In International, net sales grew 10%,
reflecting growth in the U.K., South Africa, and certain markets
in the Far East, as well as the benefit of favorable foreign
currency translation, partially offset by softness in Brazil and
Mexico. Excluding the favorable impact of foreign currency
translation, International net sales advanced 5% for the
quarter.

Operating loss in the quarter was $4.2 million, versus an
operating loss of $4.3 million in the first quarter of 2002.
This performance primarily reflected the benefit of the sales
growth, the absence of executive severance in the current
quarter, and significantly lower restructuring expenses. These
factors were almost entirely offset by higher brand support for
both North America and International, as well as charges in the
current quarter of approximately $11 million associated with
implementing the Company's growth plan (excluding brand support
expenses or any training and development costs), and higher
general and administrative expenses.

Operating loss in the current quarter included $0.5 million of
restructuring expenses and $0.2 million of additional
consolidation costs, while operating loss in the first quarter
of 2002 included expenses totaling $11.3 million, reflecting
$6.5 million of executive severance, $4.0 million of
restructuring expenses, and $0.8 million of additional
consolidation costs.

Adjusted EBITDA in the first quarter was $23.4 million, compared
with Adjusted EBITDA of $19.1 million in the first quarter of
2002. Adjusted EBITDA in the current quarter included $0.5
million of restructuring expenses, while Adjusted EBITDA in the
first quarter of 2002 included expenses totaling approximately
$11 million for executive severance, restructuring expenses, and
additional consolidation costs.

Net loss in the first quarter was $48.7 million, or $0.93 per
diluted share, compared with a net loss of $46.1 million, or
$0.88 per diluted share, in the first quarter of 2002. Cash flow
used for operating activities in the first quarter of 2003 was
$60.5 million, compared with cash flow used for operating
activities of $41.7 million in the first quarter of 2002.

Revlon Inc.'s March 31, 2003 balance sheet shows a total
shareholders' equity deficit of about $1.7 billion.

Market Share Results:

In terms of U.S. marketplace performance, according to
ACNielsen, the Company gained market share in color cosmetics in
the quarter, from 22.4% in the first quarter last year to 23.2%
in the first quarter 2003, with both the Revlon brand and the
Almay brand contributing to the share growth. Specifically,
market share for the Revlon brand advanced 1.1 share points to
17.2% for the quarter, and Almay market share grew 0.2 share
points to 5.9%.

According to ACNielsen, the color cosmetics category declined
approximately 6% in the quarter, while the Company's color
cosmetics consumption in this measured channel declined 2.6%,
driven primarily by reduced distribution for the Ultima brand.
The Company indicated that its Revlon brand registered a modest
increase in consumption for the quarter.

In other categories, the Company gained share in hair color and
anti-perspirants/deodorants, while market share declined for
skin care and implements.

Revlon is a worldwide cosmetics, skin care, fragrance, and
personal care products company. The Company's vision is to
become the world's most dynamic leader in global beauty and skin
care. A web site featuring current product and promotional
information can be reached at http://www.Revlon.comand
http://www.Almay.com The Company's brands, which are sold
worldwide, include Revlon(R), Almay(R), Ultima(R), Charlie(R),
Flex(R), and Mitchum(R).


ROWE COS.: Sells Capital Shares of Mitchell Gold Unit for $46MM
---------------------------------------------------------------
The Rowe Companies sold the outstanding capital stock of its
subsidiary, The Mitchell Gold Co., and certain related
intangible assets, to Furniture Acquisition Corp., an entity
formed by Wafra Partners LLC, a New York based private equity
firm, the Mitchell Gold Co. management and others, for
approximately $46 million in cash, subject to adjustments for
certain real property indebtedness and final working capital
determination, which is expected to result in net proceeds of
approximately $40 million. The management group is comprised of
Mitchell Gold, who was a director of the Company until his
resignation in connection with the transaction and who is also
the President and a former owner of The Mitchell Gold Co., as
well as Robert T. Williams, an executive officer and a former
owner of The Mitchell Gold Co.

The Company's current liabilities exceeded current assets by
about $8 million at March 2, 2003.


RURAL/METRO: Wins $11MM Fort Worth Ambulance Renewal Contract
-------------------------------------------------------------
Rural/Metro Corporation (Nasdaq:RURL), the nation's leading
provider of private ambulance and firefighting services, has
been awarded the exclusive renewal contract to continue
providing emergency and non-emergency ambulance service in Fort
Worth, Texas, and 12 surrounding communities.

The contract is valued at approximately $11.6 million annually
and begins on Aug. 1, 2004. It was awarded Wednesday upon a
unanimous vote of the Fort Worth Area Metropolitan Ambulance
Authority Board of Directors. The agreement provides for an
initial term of one year, and includes five, one-year, optional
renewals thereafter, for a total possible length of six years.
Rural/Metro began serving the Fort Worth metropolitan area in
1999.

Jack Brucker, president and chief executive officer, said, "Our
consistent track record for renewing significant EMS contracts
demonstrates our high level of commitment to the communities we
serve. We are very pleased to continue to provide Fort Worth and
its surrounding communities with superior medical transportation
services."

Rural/Metro's fixed-price contract is based on a high-
performance Public Utility Model, which means the Fort Worth
Area Metropolitan Ambulance Authority administers the agreement
and service under the trade name MedStar. The Authority procures
equipment, manages administrative expenses, and handles billing
and collections. Under then new agreement, the Authority also
will take responsibility for the procurement of vehicles and
fleet maintenance.

The contract includes the cities of Fort Worth, Burleson, Forest
Hill, Haltom City, Haslet, Lakeside, Lake Worth, River Oaks,
Saginaw, Sansom Park, Westover Hills, White Settlement and
Westworth Village. The communities are home to more than 850,000
citizens and generate about 65,000 emergency medical transports
annually.

Boo Heffner, president of Rural/Metro's West Emergency Services
Group, said, "We have forged an excellent relationship with the
city of Fort Worth and its neighboring communities over the past
four years and look forward to serving the ambulance needs of
the citizens for many years to come. We take great pride in our
experienced team of EMS professionals and the vital role they
play in the area's overall emergency response system."

During Rural/Metro's first four years of service to the Fort
Worth area, it has gained accreditation for the MedStar system
from two national organizations. In 2001, Rural/Metro-Medstar
won accreditation from the Commission on Accreditation of
Ambulance Services, which is awarded only to ambulance systems
that achieve the highest quality standards in the industry. In
2002, the National Academy of Emergency Medical Dispatch named
Rural/Metro-Medstar's communications center an Accredited Center
of Excellence.

Rural/Metro Corporation, whose December 31, 2002 balance sheet
shows a total shareholders' equity deficit of about $160
million, provides emergency and non-emergency medical
transportation, fire protection, and other safety services in
approximately 400 communities throughout the United States. For
more information, visit the Rural/Metro Web site at
http://www.ruralmetro.com

Rural/Metro Corp.'s 7.875% bonds due 2008 (RURL08USR1) are
trading at about 70 cents-on-the-dollar, says DebtTraders. See
http://www.debttraders.com/price.cfm?dt_sec_ticker=RURL08USR1
for real-time bond pricing.


SAXON ASSET: Fitch Takes Rating Actions on Series 1999-1 Issue
--------------------------------------------------------------
Fitch Ratings has taken rating actions on the following Saxon
Asset Securities Trust issue:

                  Series 1999-1 Group 1:

         -- Classes AF-4 - AF-6 affirmed at 'AAA';

         -- Class MF-1 affirmed at 'AA';

         -- Class MF-2 affirmed at 'A';

         -- Class BF-1 affirmed at 'BBB';

         -- Class BF-2, rated 'BB', is placed on Rating Watch
            Negative;

         -- Class BF-3 is downgraded from 'B' to 'CCC'.

                    Series 1999-1 Group 2:

         -- Class MV-1 affirmed at 'AA';

         -- Class MV-2 affirmed at 'A';

         -- Class BV-1 affirmed at 'BBB';

         -- Class BV-2 affirmed at 'BB';

         -- Class BV-3 is downgraded from 'B' to 'CCC'.

The negative rating action is taken due to the level of losses
incurred and the high delinquencies in relation to the
applicable credit support levels as of the March 2003
distribution date.


SCIENTIFIC LEARNING: Mar. 31 Net Capital Deficit Widens to $8.7M
----------------------------------------------------------------
Scientific Learning (OTC BB: SCIL) announced its revenue for the
quarter ended March 31, 2003 was $6.4 million, compared to $3.2
million for the quarter ended March 31, 2002, an increase of
100%.

Deferred revenue totaled $12.7 million at quarter-end, compared
to $7.4 million on March 31, 2002. Approximately 85% of deferred
revenue is expected to be recognized as revenue in the next four
quarters.

"We had an excellent first quarter. Our $6.4 million in revenue
reflects the strength and visibility of our deferred revenue
stream as well as strong K-12 sector sales in the quarter," said
Robert C. Bowen, Chairman and CEO of Scientific Learning. "Our
K-12 sales increased in the middle of our 20%-30% target range,
continuing to grow well ahead of industry rates. This is
evidence of the uniqueness of the Fast Forwardr family of
products and their significant impact on learning for struggling
readers."

Gross margins were 78% in the first quarter of 2003 compared to
79% in the same quarter of 2002. Operating expenses in the first
quarter of 2003 totaled $5.3 million compared to $6.0 million in
the first quarter of 2002. The operating loss for the quarter
was $300,000 compared to $3.5 million in the first quarter of
2002.

The net loss for the quarter was $610,000 compared to a net loss
of $3.9 million in the first quarter of 2002.

"Our operating loss was less than guidance," said Mr. Bowen,
"reflecting strong revenue growth and our continued focus on
expenses."

Scientific Learning's March 31, 2003 balance sheet shows a
working capital deficit of about $7 million, and a total
shareholders' equity deficit of about $8.7 million.

                        Business Outlook

Scientific Learning expects continued growth in 2003. For the
year ended December 31, 2003, revenue is expected to be in the
range of $28 to $30 million. The company expects to report an
operating profit of about $1.0 million.

For the second quarter of 2003, Scientific Learning expects
revenue to be in the range of $6.7 to $7.0 million compared to
$4.4 million in the same period of 2002. The Company expects to
report an operating loss of $200,000 to $500,000 in the second
quarter of 2003, compared to an operating loss of $2.7 million
in the same period of 2002.

The above targets represent the Company's current revenue and
earnings goals as of the date of this release and are based on
information current as of April 24, 2003. Scientific Learning
does not expect to update the business outlook until the release
of its next quarterly earnings announcement. However, the
Company may update the business outlook or any portion thereof
at any time for any reason.

Headquartered in Oakland, CA, Scientific Learning (OTC BB: SCIL)
sells the patented Fast ForWord(R) Family of Products that
develop and enhance cognitive skills required to read and learn
effectively. The Fast ForWord software is based on more than 30
years of neuroscience research on how to improve learning in
children, adolescents and adults. Significant gains are
frequently achieved in as few as 20 to 40 instructional
sessions. To learn more about Scientific Learning's
neuroscience-based products, visit the Company's Web sites at
http://www.scientificlearning.com and
http://www.brainconnection.com


SOLUTIA INC: Narrows Net Capital Deficit to $232MM at March 31
--------------------------------------------------------------
Solutia Inc. (NYSE: SOI) reported a first quarter loss from
continuing operations of $17 million on net sales of $596
million. This compares to income from continuing operations for
the first quarter of 2002 of $4 million on net sales of $520
million.

Solutia's continuing operations for the first quarter versus the
year-ago period were negatively impacted by elevated raw
material and energy costs, increased interest expense and lower
equity earnings from joint ventures, offset to some extent by
higher sales prices, increased sales volumes and favorable
currency exchange rate fluctuations.

The first quarter net loss included net charges of approximately
$9 million aftertax resulting from several events. The Company
eliminated approximately 170 positions during the quarter,
incurring severance charges of $7 million aftertax. The Flexsys
and Astaris joint ventures, in which the Company has a fifty
percent ownership stake, incurred restructuring charges during
the quarter related to asset impairments and severance charges.
Solutia's share of these charges was approximately $5 million
aftertax. In addition, Solutia realized a benefit of $3 million
aftertax related to the recovery of certain receivables,
established prior to 1997, which had previously been written
off.

Solutia Inc.'s March 31, 2003 balance sheet shows a total
shareholders' equity deficit of about $232 million.

"During the quarter, Solutia showed considerable improvement in
volume growth both sequentially and on a year-over-year basis.
However, we continued to be adversely impacted by the weakened
state of the global economy and the dramatic rise in raw
material and energy costs due to the war in Iraq and a
declaration of force majeure by certain suppliers of propylene,
a key raw material for Solutia," said Chairman and Chief
Executive Officer John Hunter. "We continue to take the actions
necessary to offset these circumstances, such as reducing our
cost to operate as well as passing along price increases in many
of our business lines," Hunter said.

Hunter further noted, "Solutia and many of its peer companies
continue to experience a difficult operating environment
highlighted by a continued weakness in the manufacturing sector,
underutilization of assets, intense competitive pricing
pressure, and raw material and energy costs that are not
indicative of current supply and demand dynamics. We continue to
prudently manage our businesses so we are positioned to benefit
from an improvement in the global economy."

             Results from Consolidated Operations

Solutia reported a consolidated net loss of $19 million for the
first quarter of 2003 versus a consolidated net loss of $153
million for the first quarter of 2002. Consolidated earnings for
the first quarter of 2003 included a net loss of $2 million from
the results of the Resins, Additives and Adhesives businesses,
which are presented as discontinued operations. Consolidated
earnings for the first quarter of 2002 included a $167 million
charge associated with the adoption of the goodwill and
intangible asset accounting standard, a gain of $3 million
aftertax from the sale of Solutia's interest in the Advanced
Elastomer Systems joint venture and net income of $10 million
from the results of discontinued operations.

Segment Data

Performance Products and Services net sales for the first
quarter of 2003 increased $19 million compared to the same
period of 2002 primarily due to stronger foreign currencies,
slightly higher volumes and better average selling prices. Net
sales increased in the Performance Films product lines and
Pharmaceutical Services on a quarter-over-quarter basis
primarily because of strengthened foreign currencies. Net sales
increased in Industrial Products product lines on a quarter-
over-quarter basis because of higher average selling prices,
higher volumes and strengthening foreign currencies.

Performance Products and Services profitability in the quarter
decreased $4 million versus the prior-year quarter. This was
primarily due to severance charges incurred in the first
quarter, unfavorable manufacturing variances and higher raw
material and energy costs, which were partially offset by higher
net sales.

Integrated Nylon's net sales for the first quarter of 2003
increased $57 million compared to the first quarter of 2002
driven by improved prices and volumes. First quarter price
increases occurred principally in Nylon intermediate chemicals.
While the Company announced price increases in Nylon carpet
fibers during the quarter, they were not effective until April
1. Sales volumes were up in most segments and included benefits
from reintegrating the marketing responsibilities for nylon
molding resins. These activities were previously performed under
a marketing alliance with Dow Plastics, a business unit of Dow
Chemical.

Integrated Nylon's segment profitability decreased $18 million
over the prior year quarter. This was primarily due to
approximately $60 million of higher raw material and energy
costs and severance charges incurred in the quarter, which were
partially offset by higher net sales and favorable manufacturing
variances.

              Results from Discontinued Operations

For discontinued operations, Solutia reported a first quarter
net loss of $2 million, or 2 cents per share, inclusive of a $24
million pretax gain from the sale of the Resins, Additives and
Adhesives businesses. Interest expense associated with debt that
was paid down with the transaction proceeds was allocated to
discontinued operations, totaling $24 million pretax for the
first quarter of 2003. Net income from discontinued operations
for the first quarter of 2002 was $10 million, or 9 cents per
share.

Cash Flow

Cash used in operations was $35 million in the first quarter of
2003 compared to $14 million in the first quarter of 2002, for
continuing operations. Solutia reported negative free cash flow
(cash flow from operations less capital expenditures as
presented on the statement of cash flows) of $75 million for the
first quarter, after funding $40 million of capital
expenditures. Capital expenditures in the first quarter of 2003
included the $32 million purchase of the cogeneration facility
at the Pensacola manufacturing site, as required by Solutia's
credit facility. This compares to negative free cash flow of $25
million in the first quarter of 2002, after funding $11 million
of capital expenditures. The decrease in free cash flow was
principally due to a $60 million income tax refund received in
2002, higher capital expenditures and lower earnings, partially
offset by working capital improvements.

Debt Reduction

In the first quarter of 2003, Solutia reduced its debt by
approximately $341 million from fourth quarter 2002 levels to
$856 million by using proceeds from the sale of the Resins,
Additives and Adhesives businesses. The Company paid down the
remaining $275 million under the term loan as well as the
majority of its borrowings under the $300 million revolving
credit facility.

Environmental Remediation

Solutia awaits approval of the consent decree between the
Company and the Environmental Protection Agency relating to
remediation in the Anniston, Alabama community. If the necessary
regulatory and judicial approvals are obtained for the consent
decree, the Company expects to incur an additional charge of
approximately $30 million. This charge will increase its
environmental reserves to primarily reflect the agreement to
expedite the cleanup of residential properties in Anniston that
contain PCB levels of 1 ppm or greater.

Second Quarter Outlook

For the second quarter, we expect global economies to experience
greater stability and are cautiously optimistic about signs of a
recovery in the manufacturing sector. We expect the improved
volume trend experienced in the first quarter to continue and
anticipate improvements in pricing from our fully implemented
price increases. We believe feedstock and energy costs will
remain at the current elevated levels given the continued
uncertainty in these markets. As we continue to focus on cost
control, the Company will be taking further restructuring
actions, incurring severance charges currently estimated to be
$3 million aftertax in the second quarter. Including this
charge, Solutia expects results in the second quarter to range
from a breakeven position to a loss of 5 cents.

Solutia -- http://www.Solutia.com-- uses world-class skills in
applied chemistry to create value-added solutions for customers,
whose products improve the lives of consumers every day. Solutia
is a world leader in performance films for laminated safety
glass and after-market applications; process development and
scale-up services for pharmaceutical fine chemicals; specialties
such as water treatment chemicals, heat transfer fluids and
aviation hydraulic fluid and an integrated family of nylon
products including high-performance polymers and fibers.


SPIEGEL GROUP: Turns to Shearman and Sterling for Ch. 11 Advice
---------------------------------------------------------------
The Spiegel Inc., and its debtor-affiliates obtained the Court's
authority, pursuant to Sections 327(a) and 328 of the Bankruptcy
Code and Rule 2014 of the Federal Rules of Bankruptcy Procedure,
to employ the law firm of Shearman & Sterling on a general
retainer, as counsel in these Chapter 11 cases, effective as of
the Petition Date.

The Debtors will compensate Shearman & Sterling on an hourly
basis, and will reimburse the firm for the actual, necessary
expenses incurred.  At present, Shearman & Sterling provides
legal services at rates ranging from:

          $425 to 700      partners and counsel
           195 to 550      counsel and associates
            95 to 185      for paralegals and clerks

The hourly rates are subject to periodic adjustments to
reflect economic and other conditions, and are Shearman &
Sterling's standard hourly rates for work of this nature.

It is Shearman & Sterling's policy to charge its clients in all
areas of practice for all other expenses incurred in connection
with each client's case.  The expenses charged to clients
include, among other things, telephone and telecopier toll and
other charges, mail and express mail charges, special or hand
delivery charges, document processing, photocopying charges,
travel expenses, expenses for "working meals," computerized
research, transcription costs, as well as non-ordinary overhead
expenses such as secretarial and other overtime.  Shearman &
Sterling will charge the Debtors for these expenses in a manner
and at rates consistent with charges made generally to Shearman
& Sterling's other clients.

As counsel, Shearman & Sterling will:

   a. provide legal advice with respect to their powers and
      duties as debtors in possession in the continued operation
      of their businesses and management of their properties;

   b. prepare on behalf of the Debtors necessary motions,
      applications, objections, responses, answers, orders,
      reports, and other legal papers;

   c. appear in Court and to protect the interests of the Debtors
      before this Court;

   d. provide general corporate, capital markets, securitization,
      litigation and other general non-bankruptcy services; and

   e. perform all other legal services for the Debtors that may
      be necessary and proper in these proceedings.

Shearman & Sterling has represented the Debtors since February
2003.  This representation has included general corporate,
capital markets, securitization, financing and restructuring
advice. (Spiegel Bankruptcy News, Issue No. 4; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


TODAY'S MAN: Court Approves Plan to Close 24 Remaining Stores
-------------------------------------------------------------
The U.S. Bankruptcy Court for the District of New Jersey has
approved the motion by Today's Man to liquidate its inventory
and close its remaining 24 stores. After a brief going out of
business sale commenced Friday, April 25, the menswear retailer
will close its stores and cease operations. In March 2003, the
Company filed a voluntary petition for reorganization under
Chapter 11 of the United States Bankruptcy Code.

The Company was incorporated in Pennsylvania in 1971 as Feld &
Sons, Inc. and changed its name to Today's Man, Inc. in March
1992. The Company's executive and administrative offices are
located at 835 Lancer Drive, Moorestown West Corporate Center,
Moorestown, New Jersey 08057.

The going out of business sales will be orchestrated by Needham,
MA-based The Ozer Group, one of the country's leading retail
services firms. "While this situation entails the closing of
stores of a well known men's clothing retailer in these
communities, the closing sale itself will provide an excellent
opportunity for bargain-conscious consumers," said Frank Morton,
Vice President, Merchandise, of The Ozer Group. "Shoppers will
be able to take advantage of tremendous savings on a fantastic
selection as we liquidate these stores and prepare them for
closure."


US AIRWAYS: Resolves Issues Concerning EDS & Sabre Claims
---------------------------------------------------------
US Airways Group Inc. asks Judge Mitchell to:

     -- approve a mutual release with Electronic Data Systems
        Corporation, and

     -- amend the Services Agreement between USAI and Sabre Inc.

John Wm. Butler, Jr., Esq., at Skadden, Arps, Slate, Meagher &
Flom, reminds the Court that Sabre provides information
technology services to USAI.  Sabre filed Claim Nos. 126, 127,
128, 129, 4869, 4870, 4871, 4872, and 4996 against various
estates of the Debtors.

Previously, Sabre wanted the automatic stay lifted to set off a
prepetition debt arising under the Sabre Agreements.

Mr. Butler recounts that EDS filed Proof of Claim No. 3700
against the Debtors' estate alleging a prepetition claim for
$63,960,019.83 under the ITSA.  Given the importance of
continuing to receive information technology services, the
Reorganized Debtors engaged in extensive arm's-length
negotiations with EDS and Sabre -- as well as alternative
providers -- to develop contracts that satisfy their long-term
business needs.  As a result of these negotiations, the
Reorganized Debtors have entered into the EDS Services Agreement
and Sabre Agreement.  The Reorganized Debtors have also resolved
the EDS Claim and the Sabre Claims.  Accordingly, the
Reorganized Debtors want the Court to approve the EDS Agreement
and the Sabre Agreement.

                      The Sabre Agreement

In full satisfaction of all claims, USAI will pay Sabre
$588,413. Payments will be made, without interest, in 24 equal
monthly payments of $24,517, beginning on the last day of April
2003.

In return, Sabre will pay USAI $1,045,096.  This sum does not
include interest and will be paid in 24 equal monthly payments
of $43,546, beginning on the last day of April 2003.

                       The EDS Agreement

EDS and USAI will unconditionally, fully and completely release
and forever discharge each other from any and all claims
relating to the MFC Dispute, the EDS Claim, or the Preference
Claim. (US Airways Bankruptcy News, Issue No. 32; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


USG CORPORATION: Reports "Solid" First Quarter 2003 Results
-----------------------------------------------------------
USG Corporation (NYSE: USG), a leading building products
company, reported first quarter net sales of $862 million and
net earnings of $6 million. Diluted earnings per share for the
first quarter of 2003 were $0.13. Net earnings included an
after-tax charge of $16 million, or $0.37 per share, related to
the adoption of Statement of Financial Accounting Standards
("SFAS") No. 143, "Accounting for Asset Retirement Obligations."

"USG achieved solid results in the first quarter," reported USG
Corporation Chairman, President and CEO William C. Foote.
"Demand for most of our products and services continued to be
strong and USG's operating units remained focused on
implementing their plans for improving customer service,
increasing operating efficiencies and growing their businesses.
We did face significantly higher energy costs during the
quarter, but we were able to partially offset their negative
impact with productivity improvements and our energy hedging
program.

"For the remainder of the year, we still expect demand for
gypsum wallboard to remain strong, supported by a healthy
housing market. Challenges include a weak commercial
construction market and cost pressures in several areas. As
evidenced by our performance in this environment, our plans are
serving us well and we will stay the course in building a
stronger USG," concluded Foote.

Net sales in the first quarter increased by $33 million, or 4
percent, versus the $829 million achieved in the first quarter
of 2002. The first quarter net earnings of $6 million compared
with a net loss of $70 million in the same period a year ago.

Results in both periods included charges related to adoption of
accounting standards. Included in the first quarter of 2003 was
an after-tax charge of $16 million, or $0.37 per share, related
to the adoption of SFAS No. 143. This standard requires the
recording of the fair value of a liability for asset retirement
obligations. The Corporation's asset retirement obligations
include reclamation activities related to assets such as
quarries, mines and wells. Included in the first quarter of 2002
was a $96 million, or $2.22 per share, non-cash, non-taxable
charge related to the adoption of SFAS No. 142, "Goodwill and
Other Intangible Assets." Earnings before the effects of these
charges were $22 million, or $0.50 per share, in the first
quarter of 2003, and $26 million, or $0.60 per share, in the
first quarter of 2002. See the attached Consolidated Statement
of Earnings for a reconciliation of net earnings or loss before
and after these accounting charges.

                     North American Gypsum

USG's North American Gypsum business recorded first quarter 2003
net sales of $542 million and operating profit of $38 million,
an increase of 3 percent and a decline of 34 percent,
respectively, from the first quarter of 2002.

United States Gypsum Company realized first quarter 2003 net
sales of $496 million and operating profit of $30 million. Net
sales increased by $13 million and operating profit declined by
$16 million compared to the first quarter of 2002. Most of the
decline in U.S. Gypsum's operating profit came from an increase
in the cost of producing the company's Sheetrockr brand gypsum
wallboard. The increase was primarily due to higher energy
costs. Energy is a major component of wallboard cost and spot
prices for natural gas, the major source of energy in the
manufacturing process, were nearly three times higher in the
first quarter than during the same period a year ago. Higher
waste paper prices also contributed to the higher wallboard
production costs in the quarter.

U.S. Gypsum's nationwide average realized price of wallboard was
$97.13 per thousand square feet during the first quarter, an
increase of $1.29 per thousand square feet compared to the first
quarter last year. However, the first quarter's average price
was less than the $102.98 realized in the fourth quarter of
2002, reflecting the effects of lower demand from both normal
seasonal factors and harsher-than-usual winter weather in
certain parts of the country. The company has announced a 10
percent price increase on all its gypsum wallboard products for
early May.

U.S. Gypsum's shipments in the first quarter totaled 2.5 billion
square feet, 3 percent lower than the very strong level
experienced in the first quarter of 2002. Shipments in the first
quarter last year were the second highest level of quarterly
shipments in the company's history.

During the first quarter, U.S. Gypsum continued to grow sales of
its complementary products. The company achieved record first
quarter shipments of its Sheetrock brand joint compounds and
Durock(R) brand cement board products. To accommodate this
growth and improve service, the company has recently added
production capacity for both products, including a new joint
compound manufacturing facility in Glendale, Arizona, and a new
cement board production line at its Baltimore, Md., gypsum
plant.

The gypsum division of Canada-based CGC Inc. reported first
quarter 2003 net sales of $57 million and operating profit of $5
million. Net sales increased by $7 million while operating
profit declined by $1 million compared to the first quarter of
2002. Sales improved largely due to higher realized selling
prices for, and increased shipments of, Sheetrock brand gypsum
wallboard. Operating profit was adversely impacted by higher
energy costs.

                        Worldwide Ceilings

USG's Worldwide Ceilings business reported first quarter net
sales of $147 million, a decrease of $1 million compared to the
first quarter of 2002. Both the domestic and international
ceilings businesses continued to experience weak market
conditions amid declining commercial construction activity.
However, operating profit in the first quarter of 2003 was $8
million, an increase of $3 million compared to the same period
last year.

USG's domestic ceilings business, USG Interiors, reported an
operating profit of $6 million compared with $7 million in the
first quarter of 2002. Profitability declined primarily due to
the impact of higher energy prices and reduced volumes compared
to the first quarter of 2002. This business continues to be
challenged by a soft commercial construction market. In
response, USG Interiors has focused on enhancing its service and
product offerings to customers and managing costs.

USG International reported a profit of $1 million compared with
a loss of $3 million in last year's first quarter. As previously
reported, the unit closed its Belgium ceiling tile plant in the
fourth quarter last year and took other actions to improve
profitability. Operating profit of $1 million for the ceilings
division of CGC Inc. was the same as last year's first quarter.

                Building Products Distribution

L&W Supply, USG's building products distribution business,
reported first quarter 2003 net sales of $295 million compared
to $275 million in the same period a year ago. The 7 percent
increase in sales was due to higher sales of both wallboard and
complementary building products. Operating profit was $8 million
in the first quarter of 2003, an increase of $1 million versus
the first quarter of 2002, reflecting the improved sales level.

L&W Supply operates 181 locations in the U.S. that distribute
gypsum wallboard, metal studs, ceiling tile and grid, and other
related building materials.

                Other Consolidated Information

First quarter 2003 selling and administrative expenses totaled
$80 million, a decrease of $2 million, or 2 percent, year-over-
year. Selling and administrative expenses as a percent of net
sales were 9.3 percent, down from 9.9 percent in the comparable
2002 period.

USG incurred Chapter 11 reorganization expenses of $2 million in
the first quarter of 2003 and 2002. For both periods, this
consisted of $4 million in legal and financial advisory fees,
partially offset by bankruptcy-related interest income of $2
million. Under AICPA Statement of Position 90-7 ("SOP 90-7"),
"Financial Reporting by Entities in Reorganization Under the
Bankruptcy Code," interest income on USG's bankruptcy-related
cash is offset against Chapter 11 reorganization expenses.

Interest expense of $1 million was recorded in the first quarter
of 2003 and 2002. Under SOP 90-7, virtually all of USG's
outstanding debt is classified as liabilities subject to
compromise, and interest expense on this debt has not been
accrued or recorded since USG's bankruptcy filing. Contractual
interest expense not accrued or recorded on pre-petition debt
totaled $18 million in the first quarter of 2003 and 2002. From
the date of USG's bankruptcy USG CORPORATION REPORTS FIRST
QUARTER RESULTS/6 filing through March 31, 2003, contractual
interest expense not accrued or recorded on pre-petition debt
totaled $133 million.

As of March 31, 2003, USG had $768 million of cash, cash
equivalents and marketable securities on a consolidated basis,
down from $830 million as of December 31, 2002. The decrease was
largely attributable to cash used to fund seasonal working
capital needs and payments associated with employee benefit and
compensation plans. Capital expenditures in the first quarter of
2003 were $17 million compared with $15 million in the
corresponding 2002 period.

As of March 31, 2003, USG had a $100 million line of credit
under a debtor-in-possession financing facility. Of this total,
$16 million supported standby letters of credit and $84 million
was unused.

                   Chapter 11 Reorganization

On June 25, 2001, USG Corporation and 10 of its subsidiaries
filed voluntary petitions for reorganization under Chapter 11 of
the United States Bankruptcy Code in the United States
Bankruptcy Court for the District of Delaware. This action was
taken to resolve asbestos-related claims in a fair and equitable
manner, to protect the long-term value of USG's businesses and
to maintain their leadership positions in their markets. The
Chapter 11 cases are being jointly administered as In re: USG
Corporation et al. (case no. 01-2094).

During the first quarter of 2003, there were several
developments in USG's bankruptcy case. January 15 was the bar
date, or deadline, for filing all claims other than asbestos-
related personal injury claims against the Debtors. An initial
review of the claims filed by the bar date suggests that many
are duplicates of other proofs of claim or of liabilities
previously scheduled by the Debtors. In addition, many claims
were filed against multiple Debtors or against the wrong Debtor.
The Debtors will continue evaluating the claims, but at this
time, it is not possible to determine if any change is required
to our estimate of the liability for these claims.

On February 19, a federal judge in USG's case issued a
Memorandum Opinion and Order setting forth a procedure for
estimating the Debtors' liability for asbestos personal injury
claims alleging cancer. The procedure will not address non-
malignant claims at this time. Pursuant to the court order, on
March 21, the Debtors submitted to the court a proposed
timetable for a bar date for cancer claims, a proposed proof of
claim form, and a plan for providing notice of the bar date. The
court has not yet ruled on the Debtors' proposal.

"While these developments represent important progress in our
case, much still remains to be done. We plan to continue our
efforts to keep our Chapter 11 reorganization moving forward,"
stated Foote.

USG Corporation is a Fortune 500 company with subsidiaries that
are market leaders in their key product groups: gypsum
wallboard, joint compound and related gypsum products; cement
board; gypsum fiber panels; ceiling panels and grid; and
building products distribution.


WHEELING-PITTSBURGH: Seeks July 7 Lease Decision Time Extension
---------------------------------------------------------------
Wheeling-Pittsburgh Steel Corp. and its debtor-affiliates ask
Judge Bodoh to further extend their deadline to assume, reject,
or assume and assign unexpired leases of non-residential real
property to and including July 7, 2003.

Under the provisions of the Bankruptcy Code, debtors must cure
any defaults that exist under the leases for Leased Properties,
at the time of any assumption thereof, which requirement has
obvious significant financial consequences as to the amount of
administrative expenses incurred or to be incurred by the
Debtors' estates.  Since the Petition Date, the Debtors have
been dealing with a multitude of complex supply, employee and
contract issues that typically arise in large and complicated
Chapter 11 cases.  Simultaneously, the Debtors have been
stabilizing operations and working towards the ultimate goal
of confirming a plan of reorganization.

The next two months are critical in terms of the success or
failure of the Debtors' reorganization.  The Debtors are
currently involved in serious substantial negotiations with the
appropriate constituencies in these cases regarding their
Disclosure Statement and their Plan.  Thus, the Debtors need
more time to decide whether to assume or reject unexpired leases
in a manner that is consistent with their reorganization plan.

The sheer size and volume of these Chapter 11 cases and the
complex nature of the reorganization issues involved justify a
further extension of the period to assume or reject an unexpired
lease of non-residential property for "cause" because:

           (i) the decision to assume or reject the Leased
               Properties is central to the Debtors' Plan;

          (ii) the Debtors have not had the time necessary to
               intelligently appraise their financial situation
               and the potential value of their assets;

         (iii) the Leased Properties constitute a number of
               business properties and Debtors need additional
               time to determine whether to assume or reject
               these leases; and

          (iv) the Debtors have complied with all their
               postpetition obligations under the leases for the
               Leased Properties in accordance with the
               Bankruptcy Code.

                   SunTrust Bank's Limited Objection

SunTrust Bank is the successor-in-interest to Crestar Bank as
Indenture Trustee.

SunTrust serves as Indenture Trustee under an Indenture dated
Sept. 1, 1999, between the Director of the State of Nevada
Department of Business and Industry, and the Indenture Trustee,
relating to the issuance of $3,100,000 Industrial Development
Revenue Bonds (Wheeling-Pittsburgh Steel Corporation Project)
Series 1999A, and $400,000 Industrial Development Revenue Bonds
(Wheeling-Pittsburgh Steel Corporation Project) Taxable Series
1999B.  The proceeds of these Bonds were loaned by the Director
to FBW Leasecorp, Inc., a Maryland corporation, under a
financing agreement dated September 1, 1999, between the
Director and FBW.

By the terms of the Financing Agreement, FBW agreed to lease a
project consisting of the acquisition, construction, improvement
and equipping of a manufacturing facility in Churchill County,
Nevada, to the Debtors as users of the Project.

Under the Lease, the Debtors are required to make monthly rental
payments consisting of payments required to service debt on the
Bonds. This Lease appears to be included in the Debtors'
Extension Request.

Victoria E. Powers, Esq., at Schottenstein Zox & Dunn, clarifies
that, to the extent that its lease involved in the industrial
development revenue bond funding, which SunTrust as Indenture
Trustee is a party, constitutes a true lease and not a secured
financing, the Debtors have not complied with all of their
postpetition obligations.

While the Indenture Trustee has sought this clarification
before, the Court has granted the extensions, but has included a
clarification in response to SunTrust's objection, and SunTrust
wants to continue that tradition.

             First Union Bank Also Seeks Clarification

First Union National Bank is an Indenture Trustee under an
Indenture dated as of April 1, 1999, between the Industrial
Development Authority of Greenville County, Virginia, and the
Indenture Trustee, relating to the issuance of $4,500,000
Industrial Development Revenue Bonds (Wheeling-Pittsburgh Steel
Corporation Project) Series 1999A, and $180,000 Industrial
Development Revenue Bonds (Wheeling-Pittsburgh Steel Corporation
Project) Taxable Series 1999B.  These bonds were issued
primarily to finance and refinance the acquisition of real
property in the County of Greenville, Virginia, and the
acquisition, construction and equipping of a facility for the
manufacturing of corrugated steel products on the Site.  The
Facility and Site were leased to the Debtors under a Lease
Agreement dated August 17, 1998, between the Authority and the
Debtors.

To the extent that its lease constitutes a true lease and not a
secured financing, First Union asserts that the Debtors have not
complied with all of their postpetition obligations. (Wheeling-
Pittsburgh Bankruptcy News, Issue No. 38; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


ZAMBA SOLUTIONS: Further Strengthens Balance Sheet after Q1 2003
----------------------------------------------------------------
ZAMBA Solutions (OTCBB:ZMBA) announced its results for the
fiscal first quarter ended March 31, 2003. Revenues before
reimbursement for direct costs were $2,510,000, compared to
$3,000,000 for the first quarter of 2002. Net income was
$2,061,000, including a $1,863,000 gain on sale of a portion of
our NextNet Series A Preferred Stock, compared to a net loss of
$5,336,000 for the first quarter of 2002.

Michael Carrel, Chief Financial Officer, said, "For the third
quarter in a row, our financial results improved over the prior
quarter's results, and exceeded our expectations. We also had
several other positive developments:

-- Improved operating results - we had our first quarter of
    operating profitability (income from operations) in more than
    two years, one quarter ahead of plan;

-- Financing - we received $1.4M, capping the $11.4M we have
    raised since June 2001;

-- Cost Reduction - we settled the last of the large lease
    agreements that we wanted to terminate, all of which combined
    resulted in our eliminating over $11 million worth of long-
    term lease obligations and contributed in part to an
    approximately 80% decrease in our quarterly cost structure,
    from approximately $12.9 million in the first quarter of 2001
    to approximately $2.5 million in the first quarter of 2003;
    and

-- Client success - we successfully implemented, for Canon, a
    large PeopleSoft CRM implementation and intend to leverage
    this success for future business.

At our new cost structure, we believe that profitability should
continue to be attainable through 2003.

Zamba Corporation's March 31, 2003 balance sheet shows a total
shareholders' equity deficit of about $266,000, down from a
deficit of about $2.3 million at December 31, 2002.

Also, as a result of our substantial cost reductions, business
achievements and financial improvement, KPMG LLP, our
independent external auditor, did not include a paragraph in its
audit opinion on our 2002 financial statements expressing
substantial doubt about our ability to continue as a going
concern as they had done on our 2001 financial statements."

"We are very excited about reaching profitability and now need
to sustain it," said Norm Smith, President and Chief Executive
Officer. "Our main focus right now is to continue to deliver
high quality work to our clients, and to grow revenue through
gaining net new clients. My experience shows that if we serve
our clients well, our own success will follow."

ZAMBA Solutions is a premier customer care services company. We
help our clients be more successful in: acquiring, servicing,
and retaining their customers. Having served over 300 clients,
ZAMBA is focused exclusively on customer-centric services by
leveraging best practices and best-in-class technology to enable
insightful, consistent interactions across all customer
touchpoints.

ZAMBA's clients have included ADC, Aether Systems, Best Buy,
Canon, GE Medical Systems, Enbridge Services, Fleet Bank, Hertz,
General Mills, Microsoft Great Plains, Nikon, Northrop Grumman,
Symbol Technologies, Towers Perrin, Union Bank of California,
and Volkswagen of America. The company has offices in
Minneapolis, San Jose and Toronto. For more information, contact
ZAMBA at http://www.ZAMBAsolutions.com


* Howard Brownstein Shares His Thoughts about Turnarounds
---------------------------------------------------------
Howard Brod Brownstein at NachmanHaysBrownstein, Inc., shared
his thoughts, based on more than a decade of turnaround and
restructuring work, in the Keynote Address at the Harvard
Business School's Annual Turnaround Management Symposium last
month.  A copy of Mr. Brownstein's address is available at no
charge at:

      http://bankrupt.com/misc/BrownsteinKeynote.pdf

Mr. Brownstein recalls the days when "No multibillion dollar
company-let alone an industry leader-could ever fail!" and sees
that today "bankruptcy has become a business-planning tool."

A full-text copy of the Turnaround Symposium brochure is at:

      http://bankrupt.com/misc/HBSTS.pdf

Mr. Brownstein has specialized in turnaround management for over
ten years. In addition to leading turnaround assignments for
NHB's clients, Mr. Brownstein has principal responsibility for
the firm's debt and equity refinancing activities, as well as
the marketing of its services to clients, their advisors and
lenders.  He has led client assignments in a variety of
industries, fulfilling the roles of CEO, CFO or COO.  He has
also served as Financial Advisor to Debtors and to Creditor
Committees in Bankruptcy Proceedings, and served as an expert in
the landmark Merry-Go-Round case as well as in other
proceedings.

Mr. Brownstein is a Certified Turnaround Professional.  He is a
Director of the Turnaround Management Association, has served on
its national Executive Committee, and is a member of the
Editorial Board of the Journal of Corporate Renewal.  He also
serves as a Contributing Editor of ABF Journal.

Mr. Brownstein is a frequent speaker at professional and
educational programs, and a regular contributor to journals and
periodicals.  He is a graduate of Harvard University where he
obtained JD and MBA degrees in a four-year joint program.  His
studies there focused on legal and business aspects of finance,
marketing and corporate strategy.  Following graduation, Mr.
Brownstein was admitted to practice law in Pennsylvania,
Massachusetts and Florida, and retains active status for
continuing legal education in Pennsylvania.


* BOND PRICING: For the week of April 28 - May 2, 2003
------------------------------------------------------

Issuer                                Coupon   Maturity  Price
------                                ------   --------  -----
Abgenix Inc.                           3.500%  03/15/07    74
Adelphia Communications                3.250%  05/01/21     8
Adelphia Communications                6.000%  02/15/06     8
Adelphia Communications               10.875%  10/01/10    46
Advanced Micro Devices Inc.            4.750%  02/01/22    73
Alamosa Delaware                      12.500%  02/01/11    49
Alamosa Delaware                      13.625%  08/15/11    51
Alexion Pharmaceuticals                5.750%  03/15/07    71
American & Foreign Power               5.000%  03/01/30    67
Amkor Technology Inc.                  5.000%  03/15/07    68
AMR Corp.                              9.000%  09/15/16    32
AnnTaylor Stores                       0.550%  06/18/19    64
Aquila Inc.                            6.625%  07/01/11    70
Axcelis Technologies                   4.250%  01/15/07    75
BE Aerospace Inc.                      8.000%  03/01/08    66
Best Buy Co. Inc.                      0.684%  06/27/21    72
Burlington Northern                    3.200%  01/01/45    53
Burlington Northern                    3.800%  01/01/20    74
Calpine Corp.                          4.000%  12/26/06    75
Calpine Corp.                          8.500%  02/15/11    65
Calpine Corp.                          8.625%  08/15/10    63
Capstar Hotel                          8.750%  08/15/07    70
Charter Communications, Inc.           4.750%  06/01/06    32
Charter Communications Holdings        8.250%  04/01/07    59
Charter Communications Holdings        8.625%  04/01/09    60
Charter Communications Holdings        9.625%  11/15/09    62
Charter Communications Holdings       10.000%  04/01/09    62
Charter Communications Holdings       10.000%  05/15/11    57
Charter Communications Holdings       10.250%  01/15/10    57
Charter Communications Holdings       10.750%  10/01/09    61
Charter Communications Holdings       11.125%  01/15/11    60
Cincinnati Bell Telephone (Broadwing)  6.300%  12/01/28    73
Comcast Corp.                          2.000%  10/15/29    25
Conexant Systems                       4.000%  02/01/07    60
Conexant Systems                       4.250%  05/01/06    67
Conseco Inc.                           8.750%  02/09/04    17
Continental Airlines                   4.500%  02/01/07    45
Cox Communications Inc.                0.348%  02/23/21    72
Cox Communications Inc.                2.000%  11/15/29    32
Cox Communications Inc.                3.000%  03/14/30    47
Crown Cork & Seal                      7.375%  12/15/26    72
Crown Cork & Seal                      8.000%  04/15/23    71
Cummins Engine                         5.650%  03/01/98    65
Delta Air Lines                        7.700%  12/15/05    62
Delta Air Lines                        9.250%  03/15/22    46
Delta Air Lines                       10.375%  02/01/11    52
Dynegy Holdings Inc.                   6.875%  04/01/11    74
Dynex Capital                          9.500%  02/28/05     2
Elwood Energy                          8.159%  07/05/26    66
Finova Group                           7.500%  11/15/09    37
Fleming Companies Inc.                10.125%  04/01/08    14
Ford Motor Co.                         6.625%  02/15/28    72
Gulf Mobile Ohio                       5.000%  12/01/56    66
Health Management Associates Inc.      0.250%  08/16/20    64
HealthSouth Corp.                      3.250%  04/01/49    22
HealthSouth Corp.                      7.375%  10/01/06    59
HealthSouth Corp.                      8.375%  10/01/11    56
HealthSouth Corp.                      8.500%  02/01/08    57
I2 Technologies                        5.250%  12/15/06    54
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    62
Inland Steel Co.                       7.900%  01/15/07    68
Internet Capital                       5.500%  12/21/04    36
Isis Pharmaceutical                    5.500%  05/01/09    65
Kmart Corporation                      9.375%  02/01/06    14
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    60
Level 3 Communications                 6.000%  03/15/10    59
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    74
Lucent Technologies                    6.450%  03/15/29    66
Lucent Technologies                    6.500%  01/15/28    66
Magellan Health                        9.000%  02/15/08    25
Manugistics Group Inc.                 5.000%  11/01/07    55
Mirant Corp.                           5.750%  07/15/07    55
Missouri Pacific Railroad              4.750%  01/01/20    74
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    50
Northwest Airlines                     7.625%  03/15/05    56
Northwest Airlines                     7.875%  03/15/08    47
Northwest Airlines                     8.875%  06/01/06    52
Northwest Airlines                     9.875%  03/15/07    50
Quanta Services                        4.000%  07/01/07    71
Regeneron Pharmaceuticals              5.500%  10/17/08    68
Ryder System Inc.                      5.000%  02/25/21    72
SBA Communications                    10.250%  02/01/09    74
SCG Holding Corp.                     12.000%  08/01/09    69
Tenneco Inc.                          10.000%  03/15/08    70
Tenneco Inc.                          10.200%  03/15/08    70
Transwitch Corp.                       4.500%  09/12/05    59
United Airlines                       10.670%  05/01/04     5
Universal Health Services              0.426%  06/23/20    57
US Timberlands                         9.625%  11/15/07    73
Weirton Steel                         10.750%  06/01/05    46
Weirton Steel                         11.375%  07/01/04    58
Westpoint Stevens                      7.875%  06/15/08    26
Xerox Corp.                            0.570%  04/21/18    65

                           *********

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 ***