TCR_Public/030703.mbx          T R O U B L E D   C O M P A N Y   R E P O R T E R

              Thursday, July 3, 2003, Vol. 7, No. 130

                           Headlines

360NETWORKS: Committee Sues Tishman Construction to Recoup $1MM
AES CORP: Drax Units and Senior Creditors Reach Workout Pact
AES DRAX: Looming Default Prompts Fitch to Cut Junk Bond Rating
AIRGATE PCS: Bob Ferchat Elected as Company's New Board Chairman
ALLIS-CHALMERS: Enters Joint Venture Pact with M-I LLC Division

AMERCO: Nasdaq Panel Initiates Discussions re Listing Status
AMERCO: Brings-In Beesley Pack as Bankruptcy Co-Counsel
AMERICAN AIRLINES: June System Load Factor Up 3.6 Pts. to 78.8%
AMES DEPARTMENT: Trade Creditors Sell 12 Claims Totaling $1.8MM
ANIXTER: Fitch Rates $125 Mill. Zero Coupon Senior Notes at BB+

BCE INC: Wilfred Shaw Amends $1 Billion Class Action Lawsuit
BMC INDUSTRIES: Credit Facility Waiver Discussions Continue
BUDGET GROUP: Has Until July 29 to Make Lease-Related Decisions
CASCADES INC: Closes Sale of Additional $100-Mill. Senior Notes
CENTERPOINT ENERGY: Remarkets $150 Mill. Pollution Control Bonds

CHART IND.: Extends Bank Waivers & Defers Debt Service Payments
CINCINNATI BELL: S&P Maintains Watch Over Proposed Note Issue
CLAYTON HOMES: Orbis Urging Shareholders to Nix Berkshire Offer
COLONIAL ADVISORY: S&P Further Junks Class B Notes Rating at CC
CONSECO FINANCE: Inks Pact to Sell Credit Accounts to B-Line LLC

CONSTELLATION BRANDS: Reports Improved Performance for Fiscal Q1
CONTINENTAL AIRLINES: Posts Record June Operational Performance
CWMBS INC: Fitch Rates Class B-3 and B-4 Cert. Ratings at BB/B
DAVITA: Strong Financials Prompt S&P to Affirm BB- Credit Rating
DIAMETRICS MEDICAL: OTCBB Trading Commences Effective July 2

DICE INC: Ernst & Young Steps Down as Independent Accountants
DVI EQUIPMENT: Fitch Concerned about Increased Performance Risk
DVI HEALTHCARE: Series 1998-1 Class C Rating Dives Down to CCC
EMMIS COMMS: Completes 6 Radio Stations Asset Purchase Deals
ENCOMPASS SERVICES: Wants Nod for Valero Settlement & Compromise

ENGAGE INC: US Trustee Appoints Official Creditors' Committee
ENRON CORP: Clarifies Director Stanley Horton is Indemnified
FISHER SCIENTIFIC: S&P Rates $250M Senior Unsecured Notes at BB-
FLEMING COMPANIES: Taps DoveBid to Conduct 2nd Webcast Auction
FLEMING COMPANIES: Court Deems Utility Cos. Adequately Assured

FLEXTRONICS INT'L: Will Publish First Quarter Results on July 24
GALEY & LORD: Hires Alvarez & Marsal as Restructuring Advisors
GENCORP INC: Fitch Affirms Ratings & Revises Outlook to Stable
GILAT SATELLITE: Provides Corporate Restructuring Plan Overview
GLOBAL CROSSING: XO Airs Disappointment with Court's Decision

GLOBAL LEARNING: Wants Nod to Hire Marcus Santoro as Attorneys
GRUPO IUSACELL: 14.25% Bonds' Grace Period Passes in Silence
GSR MORTGAGE: Fitch Rates Class B4 and B5 P-T Certs. at BB/B
JC PENNEY: Fitch Affirms BB+ Rating on $1.5-Bill. Bank Facility
KEMPER INSURANCE: S&P Junks & Withdraws Counterparty Rating

LARRY'S STANDARD BRAND: Tapping Witherspoon as PR Consultants
LEAP WIRELESS: Court OKs Rogozienski as Spec. Litigation Counsel
LEVEL 3: S&P Assigns Junk Rating to Proposed Sr. Note Drawdown
LNR CDO: S&P Assigns Low-B Ratings to Class H and J Notes
LNR PROPERTY: Fitch Assigns BB- Rating to $350MM Sr. Sub. Notes

LODGENET ENTERTAINMENT: Tender Offer for 10.25% Sr Notes Expires
LONGVIEW ALUMINUM: Appoints Patrick James as Chief Exec. Officer
MCMS INC: Secures Plan Exclusivity Extension through July 12
MED DIVERSIFIED: Fourth Quarter Net Loss Stands at $39 Million
MEDMIRA INC: April 30 Net Capital Deficiency Stands at $10 Mill.

METROCALL INC: Pays Off L-T Debt and Redeems Balance of Notes
METROMEDIA FIBER: Server Central Selects AboveNet as IP Transit
MIRANT CORP: Begins Commercial Operation at Oregon Power Plant
MISSISSIPPI CHEMICAL: Hires Gordian Group for Financial Advice
MOHEGAN TRIBAL: Proposed $330MM Sr. Sub. Notes Gets BB- Rating

NATIONAL STEEL: Gets Blessing to Expand Scope of E&Y Engagement
NEFF CORP: Ratings on Watch after Subordinated Notes Repurchase
NET2000 COMMS: Chapter 7 Trustee Taps Peisner as Tax Consultants
NORTHWEST AIRLINES: Sells Worldspan Asset to Travel Transaction
ORGANOGENESIS: Massachusetts Court Approves Disclosure Statement

OWENS CORNING: Court Approves $50MM OC Metals Systems Asset Sale
PAC-WEST TELECOM: Names Hank Carabelli as New President and CEO
PACIFIC GAS: Fitch Ups Sr. Debt & Preferreds Ratings to BB-/DDD
PENN TREATY: Better Performance Spurs S&P's B- and CCC- Ratings
PILLOWTEX CORP: Term Loan Lenders Agree to Forbear Until July 10

PRIMUS TELECOMMS: S&P Revises Rating Outlook to Stable from Neg.
QWEST: Gets Financial Reporting Waivers for Facility & Term Loan
REAL ESTATE SYNTHETIC: Fitch Rates 5 Classes at Low-B Levels
RMF COMM'L: Fitch Further Junks Ser. 1995-1 Class F Rating at C
SAFETY-KLEEN: Wants Clearance for South Carolina DHEC Agreement

SAKS INC: Fitch Affirms BB+/BB- Bank Loan & Senior Note Ratings
SAMSONITE CORP: Sets Annual Shareholders' Meeting for July 31
SLI INC: Successfully Emerges from Chapter 11 Proceedings
SMTEK INT'L: Secures Conditional Nasdaq SmallCap Listing Status
SOURCINGLINK.NET: Auditors Express Going Concern Uncertainty

SPIEGEL GROUP: Court Okays Chadbourne as Committee's Counsel
STROUDS ACQUISITION: Makes Full Payment on Fog Cutter Cap. Loans
TELENETICS: Inks Settlement Pact & Mutual Release with Comtel
TENERA INC: Unit Transferring Contracted Work to S.M. Stoller
TEREX: Enters Pact with Caterpillar to Realign Mining Businesses

TEXAS DEPARTMENT OF HOUSING: S&P Downgrades Bond Ratings to B/CC
THANE INT'L: Obtains Waiver of Default Under Credit Facility
TOUCH AMERICA: Gets OK to Appoint BMC as Notice and Claims Agent
UNITED AIRLINES: Wells Fargo Demands $3MM+ Admin Expense Payment
US AIRWAYS: Reaches Agreement to Extend Stock Distribution Date

U.S. STEEL: Completes Sale of Mining Company Assets for $50 Mil.
VELTRI METAL: Extends Senior Credit & Tooling Credit Facilities
VENTAS: Completes Sale of Skilled Nursing Facilities to Kindred
WACKENHUT CORRECTIONS: Names Norman Cox VP Business Development
WATERLINK: Wants Time to File Schedules Extended to August 11

WEIRTON STEEL: Court Approves Access to $225 Mill. DIP Financing
WIRE ROPE: Completes $54.5 Mil. Asset Sale Transaction with KPS
WORLDCOM INC: AFC Calls for Competition in Federal Contracting

* Greggory Mendenhall Joins Sheppard Mullin in Washington, D.C.
* Robert Lawrence Joins Orrick's Washington, D.C. Office

* DebtTraders' Real-Time Bond Pricing

                           *********

360NETWORKS: Committee Sues Tishman Construction to Recoup $1MM
---------------------------------------------------------------
Norman N. Kinel, Esq., at Sidley Austin Brown & Wood LLP, in
New York, relates that on or within 90 days prior to the Petition
Date, 360networks (USA) inc. made two preferential transfers to or
for the benefit of Tishman Construction Corporation of D.C.
totaling $1,024,825.

On March 26, 2002, the Debtors demanded Tishman return the
money.  Tishman didn't.

Mr. Kinel tells the Court that:

     (a) each of the Transfers was made to Tishman for or on
         account of an antecedent debt the Debtors owed
         before each Transfer was made;

     (b) Tishman was a creditor at the time of the Transfers;

     (c) the Transfers were made while 360 was insolvent; and

     (d) by reason of the Transfers, Tishman was able to receive
         more than it would otherwise receive if:

         -- these Cases were cases under Chapter 7 of the
            Bankruptcy Code;

         -- the Transfers had not been made; and

         -- Tishman received payment of the debts in a Chapter 7
            proceeding in the manner the Bankruptcy Code
            specified.

By this complaint, the Official Committee of Unsecured Creditors,
on the Debtors' behalf, seeks a Court judgment:

     (a) pursuant to Section 547 of the Bankruptcy Code, declaring
         that the Transfers be and are avoided;

     (b) pursuant to Section 547, declaring that Tishman pay at
         least $1,024,825 plus interest from the date of the
         Debtors' Demand Letter as permitted by law;

     (c) pursuant to Section 550, declaring that Tishman pay at
         least $1,024,825 plus interest from the date of the
         Demand Letter as permitted by law;

     (d) pursuant to Section 502(d), providing that any and all of
         Tishman's claims against the Debtors will be disallowed
         until it repays in full the Transfers, plus all
         applicable interest; and

     (e) awarding the Committee all costs, reasonable attorneys'
         fees and interest. (360 Bankruptcy News, Issue No. 51;
         Bankruptcy Creditors' Service, Inc., 609/392-0900)


AES CORP: Drax Units and Senior Creditors Reach Workout Pact
------------------------------------------------------------
The AES Corporation's (NYSE:AES) subsidiaries reached agreement
with the steering committees representing the Senior Creditors on
the terms of the restructuring of AES Drax. In conjunction with
the agreement, AES Drax is requesting a further extension of the
standstill period to permit the parties to prepare the more
definitive documentation necessary to secure the approval of the
restructuring and to obtain consent of the relevant judicial
authorities.

Pursuant to the terms of the proposed restructuring, AES will
receive a net operating fee of GBP 3.5 million under a long-term
operations and maintenance agreement. AES will also be able to
invest an amount not to exceed GBP 60MM to purchase certain
classes of restructured debt. AES's new investment will be as a
secured creditor to the restructured Drax project. Closing of the
restructuring transaction is expected to occur in the forth
quarter of 2003 and is subject to finalization of the terms and
conditions of the transaction documents, the requisite consent of
senior creditors, as well as approval from the relevant courts in
England, Cayman Islands, and Jersey. There can be no assurance
that the approvals and/or other conditions to the proposed
restructuring will be satisfied.

Paul Hanrahan, President and Chief Executive Officer, commented
"This restructuring represents the first opportunity for AES to
participate in the distressed asset market as an O&M operator and
investor. This is one of the areas of strategic interest that we
have been evaluating for several months. What is particularly
attractive about the Drax opportunity for us is that we know both
the market and the asset extremely well. The successful
restructuring of DRAX provides us with a strong base to develop
other select opportunities where there are distressed power assets
with a need for strong operation and management capabilities. We
are pleased with the restructuring agreement reached between the
parties and the cooperation evidenced between the AES Drax
Companies and the AES Drax senior creditors as they navigated
through the collapse of TXU Europe."

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

The company's generating assets include interests in 158
facilities totaling over 55 gigawatts of capacity, in 28
countries. AES's electricity distribution network sells 108,000
gigawatt hours per year to over 16 million end-use customers.


AES DRAX: Looming Default Prompts Fitch to Cut Junk Bond Rating
---------------------------------------------------------------
Fitch Ratings, the international rating agency, downgraded the
ratings of the Senior Secured bonds issued by AES Drax Holdings
Ltd to 'C' from 'CC', and kept them on Rating Watch Negative. At
the same time, Fitch is maintaining the ratings of the senior
secured bank loan issued by Inpower Ltd and the senior notes
issued by AES Drax Energy Limited at 'DD' and 'D', respectively.
All these issues relate to 3.96 GW coal-fired Drax power station
located near Selby in the UK, which represents about 8% of the UK
market.

Interest payment on DrxHold bonds and Inpower debt due on June 30
will be met. Nevertheless, the downgrade of DrxHold's bonds to 'C'
reflects their imminent default, as Fitch expects DrxHold to enter
into a court-sanctioned scheme of arrangement to effect a debt
restructuring in the coming months. The difference of rating
between the bonds issued by DrxHold and the bank loan to Inpower,
which are both pari passu senior obligations in the complex
financing structure of Drax, continue to reflect the fact that,
unlike Inpower bank debt, DrxHold's bonds are not currently in
default.

Drax requested a further extension of the senior standstill
arrangement - which started in December 2002 - until the end of
July, with possible further extension until Aug 14, 2003. While
such an extension must be approved by 67% of senior bank lenders
and 51% of senior bondholders, Fitch expects the approval to be
forthcoming given the steering committees' involvement in the
negotiations. At the same time, Drax announced that it will meet
interest payment due on Inpower and DrxHold's debt on June 30.
This extended standstill period will allow Drax to finalize the
details of the debt restructuring and present it for the approval
of its senior creditors, on the basis of cash flow projections to
be presented. Fitch notes that the restructuring is expected to
result in a considerably reduced financial burden for the company.

The broad restructuring principles have now been agreed with the
senior creditors' steering committees and involve the conversion
of c. GBP1.3 billion outstanding senior debt into 30% super-senior
amortising debt ('A-1'), 34% senior debt ('A-2|'), which will
start to amortise when A-1's principal has been reduced by 50%,
25% of 'B' debt secured by proceeds to be received from TXU Europe
following termination of the power hedge agreement between it and
Drax, and 10% of quasi equity ('C' tranche and associated equity).
Each tranche is subordinated to the previous one in terms of
position in the cash flow waterfall and security, except that
Tranche B creditors have a priority claim on TXU receivables.

The senior lenders will also be provided with a cash-out option,
funded by a mixture of Drax's remaining cash and up to GBP60
million facility provided by AES Corp, which gives them the option
to sell their A-2 tranche at 47% of par and their C tranche at 1%
of par (both tranches have to be tendered together). To the extent
that the cash out option is funded by AES Corp, it will have the
option to acquire a corresponding amount of equity. The remaining
equity in the project will be issued to Tranche C debtholders.
DrxEn notes are secured by the shares of a holding company above
the level in which senior creditors hold security, so that the
value of senior creditors' equity stake post restructuring would
not be affected by any enforcement action of DrxEn noteholders.

In addition to the debt noted above, a new credit support facility
of GBP60 million-100 million would be provided to support Drax's
trading activity, which would be senior to all other debt in the
company. Under these proposed terms, the ultimate financing
structure of Drax after the restructuring will depend, inter-alia,
on the final details of the restructuring agreement as well as the
proportion of lenders exercising the cash out option, and the
final termination payments due on the interest rate and cross-
currency swaps. As previously noted, the restructuring is
nevertheless expected to result in a considerably reduced
financial burden for the company. The majority of equity is
expected to be held by senior lenders, although AES Corp is
expected to continue to operate the plant under an operating and
management contract.

Fitch notes that Drax has filed a GBP351 million claim for unpaid
amounts and liquidated damages as a result of the November 2002
termination of the power purchase contract with TXU Europe. There
is still considerable uncertainty regarding the precise quantum
and also the timing of amounts to be received from this claim, due
to the ongoing administration of TXU Europe. Even if Drax was
successful in recovering 100% of its claim (resulting in 100%
repayment of Tranche B), the senior lenders exercising their cash
out option would ultimately receive a package of cash and debt
equal to 71% of the original debt amount, a loss level which is
consistent with the 'DD' rating assigned to Inpower.

In addition, Fitch notes that holders of DrxEn notes gave notice
of enforcement of their security at the end of May. Following a
90-day period, they will have the possibility, subject to the
terms of the inter-creditor agreement, to enforce their security
and sell the shares of DrxEn. As stated above, Fitch does not
believe that this action will affect Drax' senior creditors.

The ratings of DraxHold and Inpower are expected to be equalized
when the borrowers initiate the court actions necessary to effect
the debt restructuring.


AIRGATE PCS: Bob Ferchat Elected as Company's New Board Chairman
----------------------------------------------------------------
AirGate PCS, Inc. (OTCBB:PCSA), a PCS Affiliate of Sprint, has
named Bob Ferchat chairman of the Company's board of directors.

Ferchat, 68, brings extensive years of experience in corporate
management, governance, finance, and leadership to his new
position. He joined the AirGate board in 1999 and has served as
chairman of the Audit Committee. Ferchat previously served as
chairman, president and chief executive officer of BCE Mobile
Communications, Inc. until January 1999. During his tenure there,
he was instrumental in successfully launching BCE Mobile's PCS
network in Canada. Prior to joining BCE, Ferchat served as
chairman and chief executive officer of TMI and previously served
as president of Northern Telecom International and Northern
Telecom Canada.

Commenting on the announcement, Thomas M. Dougherty, president and
chief executive officer of AirGate PCS, said, "We are very pleased
to have someone with Bob Ferchat's experience take on the position
of chairman of AirGate. As a member of our board, he has already
played an important role in leading the Company over the past four
years. Bob has tremendous leadership abilities and the strategic
vision to guide AirGate toward meeting its future objectives."

Ferchat replaces Barry J. Schiffman, who resigned from his
position on the board. Dougherty commented, "Barry Schiffman has
played an integral role in leading the Company since its
inception. His dedication and hard work have been important
factors in the growth of AirGate, and we thank him for all his
contributions to the company during his tenure on the Board."

AirGate PCS, Inc., excluding its unrestricted subsidiary iPCS, is
the PCS Affiliate of Sprint with the right to sell wireless
mobility communications network products and services under the
Sprint brand in territories within three states located in the
Southeastern United States. The territories include over 7.1
million residents in key markets such as Charleston, Columbia, and
Greenville-Spartanburg, South Carolina; Augusta and Savannah,
Georgia; and Asheville, Wilmington and the Outer Banks of North
Carolina. At March 31, 2003, the Company's balance sheet shows a
total shareholders' equity deficit of about $361 million.

iPCS, Inc., a wholly owned unrestricted subsidiary of AirGate PCS,
Inc., is the PCS Affiliate of Sprint with the right to sell
wireless mobility communications network products and services
under the Sprint brand in 37 markets in Illinois, Michigan, Iowa
and eastern Nebraska. The territories include over 7.4 million
residents in key markets such as Grand Rapids, Michigan;
Champaign-Urbana and Springfield, Illinois; and the Quad Cities
areas of Illinois and Iowa.

AirGate and iPCS are separate corporate entities that have
discrete and independent financing sources, debt obligations and
sources of revenue. As an unrestricted subsidiary, iPCS's lenders,
noteholders and creditors do not have a lien or encumbrance on
assets of AirGate. Further, AirGate generally cannot provide
capital or other financial support to iPCS.

Sprint operates the largest, 100-percent digital, nationwide PCS
wireless network in the United States, already serving more than
4,000 cities and communities across the country. Sprint has
licensed PCS coverage of more than 280 million people in all 50
states, Puerto Rico and the U.S. Virgin Islands. In August 2002,
Sprint became the first wireless carrier in the country to launch
next generation services nationwide delivering faster speeds and
advanced applications on Vision-enabled Phones and devices. For
more information on products and services, visit
http://www.sprint.com/mr PCS is a wholly-owned tracking stock of
Sprint Corporation trading on the NYSE under the symbol "PCS."
Sprint is a global communications company with approximately
72,000 employees worldwide and nearly $27 billion in annual
revenues and is widely recognized for developing, engineering and
deploying state-of-the-art network technologies.


ALLIS-CHALMERS: Enters Joint Venture Pact with M-I LLC Division
---------------------------------------------------------------
Allis-Chalmers Corporation (OTC Bulletin Board: ACLM) has entered
into a joint venture agreement with a division of M-I L.L.C., and
announced that it has appointed David Wilde and Scott Gildea as
officers.

           Joint Venture to Provide Air Compression
                     Products and Services

The Company announced that its subsidiary, Mountain Compressed
Air, Inc., and M-I L.L.C., contributed assets with a fair market
value in excess of $27 million to AirComp L.L.C., which the
Company believes will be the world's second largest provider of
air compressor products and services to the oil, natural gas and
geothermal drilling workover and completion industries.
Allis-Chalmers will own 55% and M-I L.L.C. will own 45% of AirComp
L.L.C. Munawar Hidayatallah, chairman of Allis-Chalmers stated:
"Through AirComp we hope to dramatically expand our geographic
markets.  In addition, by combining Allis-Chalmers high-efficiency
equipment with M-I's, we expect to be able to increase our market
share by providing customers a broader range of products and
services to fit specific drilling requirements."

In connection with the transaction, AirComp obtained financing of
$8 million, of which $7.3 million was distributed to the Company.
The Company used these funds to retire debt of Mountain Compressed
Air, Inc. and for general working capital purposes at AirComp.  As
a result of the debt repayment, the Company is in compliance with
all of its loan covenants.

The Company announced that Terry Keane has been appointed as
President and Chief Executive Officer of AirComp.

                    Executive Appointments

The Company also announced that David Wilde has been appointed as
President and Chief Operating Officer of its subsidiary, Strata
Directional Technology, Inc.  Mr. Wilde was formerly Executive
Vice President of Sales and Marketing for Allis-Chalmers
Corporation.  The Company also announced that Scott Gildea has
been appointed as Treasurer and Vice President of Allis-Chalmers
Corporation.

Allis-Chalmers Corporation provides a variety of products and
services to the drilling and production segments of the oil,
natural gas and geothermal drilling industries through its joint
venture AirComp, L.L.C., Jens' Oilfield Service, Inc., which
supplies highly specialized equipment and operations to install
casing and production tubing required to drill and complete oil
and gas wells, and Strata Directional Technology, Inc., which
provides high-end directional and horizontal drilling services for
specific targeted reservoirs that cannot be reached vertically.

Allis-Chalmers Corp.'s March 31, 2003 balance sheet shows that
its total current liabilities exceeded its total current assets
by about $12 million. The Company's total shareholders' equity
further dwindled to about $826,000 due to accumulated deficit of
about $9 million.


AMERCO: Nasdaq Panel Initiates Discussions re Listing Status
------------------------------------------------------------
AMERCO (Nasdaq: UHALQ) received a letter from Nasdaq, dated
June 24, 2003, indicating that, in light of AMERCO's recent
voluntary Chapter 11 filing, a Nasdaq Listing Qualifications Panel
will consider such filing and associated concerns in rendering a
determination regarding AMERCO's continued listing status. Nasdaq
has requested, and AMERCO has provided, information regarding
AMERCO's recent Chapter 11 filing and the anticipated effect of
the reorganization process on the shareholders of AMERCO.

As has been previously announced, AMERCO intends to pursue a full-
value plan of reorganization, which will leave its existing equity
in place upon AMERCO's emergence from Chapter 11. Pending a
determination by the Panel, AMERCO's common stock will continue to
be listed on Nasdaq. Although AMERCO intends to cooperate fully
with Nasdaq and to take all actions available to maintain its
Nasdaq listing, there can be no assurance that Nasdaq will permit
AMERCO's continued listing. In addition, as a result of the
Chapter 11 filing, the fifth character "Q" was appended to the
AMERCO trading symbol, which was changed temporarily from UHAL to
UHALQ.

For more information about AMERCO, visit http://www.amerco.com


AMERCO: Brings-In Beesley Pack as Bankruptcy Co-Counsel
-------------------------------------------------------
Beesley, Peck & Matteoni, Ltd. has one of the largest bankruptcy
practice groups in Nevada with offices in Reno.  BP&M has
expertise in various practice areas, which will be significant to
AMERCO's case, including bankruptcy and restructuring, corporate
finance and commercial litigation.  Moreover, BP&M possesses
expertise in bankruptcy matters recognized on a regional basis,
having been actively involved in major Chapter 11 cases, including
Washington Group International, Agribio Tech and Stratosphere.

AMERCO seeks the Court's authority to employ and retain BP&M as
its co-counsel for restructuring and bankruptcy issues and as
conflicts counsel to the extent Squire Sanders can't represent
AMERCO in a particular matter.

Andrew Stevens, AMERCO's Chief Financial Officer, tells the Court
that BP&M has made a concerted effort to familiarize itself with
AMERCO's business, capital structure and financial affairs through
certain prepetition local counsel representation of AMERCO's non-
debtor affiliates.  In addition, BP&M has become very involved and
has participated in the preparation of the present Chapter 11
filing.  Moreover, AMERCO believes that BP&M has the unique
expertise in areas of local practice that will assist it to
effectively move through the Chapter 11 process.

To assist Squire Sanders, BP&M will:

     (a) Advise AMERCO with respect to its powers and duties as
         debtor-in-possession in the continued management and
         operation of its business and property;

     (b) Attend meetings and negotiating with representatives of
         creditors and other parties-in-interest and advising and
         consulting on the conduct of this Chapter 11 case,
         including all of the legal and administrative
         requirements of operating in Chapter 11;

     (c) Assist AMERCO with the preparation of its Schedules of
         Assets and Liabilities and Statements of Financial
         Affairs;

     (d) Advise AMERCO in connection with any contemplated sales
         of assets or business combinations, including the
         negotiation of asset, stock, purchase, merger or joint
         venture agreements, formulation and implement appropriate
         procedures with respect to the closing of any
         transactions and counseling the Debtor in connection with
         the transactions;

     (e) Advise AMERCO in connection with any postpetition
         financing and cash collateral arrangements and
         negotiating and drafting documents relating thereto,
         providing advice and counsel with respect to related
         prepetition financing arrangements, and negotiating and
         drafting documents;

     (f) Advise AMERCO on matters relating to the evaluation of
         the assumption, rejection or assignment of unexpired
         leases and executory contracts;

     (g) Advise AMERCO with respect to legal issues arising in or
         relating to its ordinary course of business including
         attendance at senior management meetings, meetings with
         AMERCO's financial and turnaround advisors and meetings
         of the Board of Directors;

     (h) Take all necessary action to protect and preserve
         AMERCO's estate, including the prosecution of actions on
         its behalf, the defense of any actions commenced against
         it, negotiations concerning all litigation in which
         AMERCO is involved and objecting to claims filed against
         AMERCO's estate;

     (i) Prepare, on AMERCO's behalf, all motions, applications,
         answers, orders, reports and papers necessary to the
         administration of the estate;

     (j) Negotiate and prepare, on AMERCO's behalf, a plan of
         reorganization, disclosure statement and all related
         agreements or documents and taking any necessary action
         on AMERCO's behalf to obtain plan confirmation;

     (k) Attend meetings with third parties and participating in
         negotiations with respect to bankruptcy case matters;

     (l) Appear before the Court, any appellate courts and the
         U.S. Trustee and protecting the interests of the AMERCO's
         estate before the Court and the U.S. Trustee;

     (m) Perform all other necessary legal services and providing
         all other necessary legal advice to AMERCO in connection
         with this Chapter 11 case; and

     (n) Act as AMERCO's counsel to the extent that Squire Sanders
         cannot act by reason of a conflict.

Bridget Robb Peck, Esq., a shareholder of BP&M, assures Judge Zive
that BP&M does not hold or represent an interest adverse to
AMERCO's estate and is a "disinterested person" as that term is
defined in Section 101(14) of the Bankruptcy Code, with respect to
matters for which it is to be retained.  In addition, BP&M's
professionals do not have any connection with AMERCO or its
affiliates, its creditors, its estate, any U.S. District Judge or
Bankruptcy Judge for the District of Nevada, the U.S. Trustee or
any person employed in the Office of the U.S. Trustee for Region
17, or any other party-in-interest, or their respective attorneys
and accountants.

According to Ms. Peck, as of June 17, 2003, AMERCO formally
retained BP&M to represent it in connection with its present
efforts to restructure its business under an Engagement Agreement.
In accordance with BP&M's engagement prepetition, BP&M received a
$100,000 retainer prior to the Petition Date. Thereafter, BP&M
periodically invoiced AMERCO and drew down on the Retainer in
payment of the invoices for services rendered in the ordinary
course of business in connection with this case before the
Petition Date.

As of the Petition Date, BP&M had been compensated for all known
fees and reimbursed for all known expenses incurred prepetition
totaling $20,000.  Thus, the Retainer remained unapplied. Though,
BP&M reserves the right to apply additional amounts of the
Retainer to fees and expenses accrued prepetition but not
discovered or otherwise accounted for until after the Petition
Date.  BP&M will retain all remaining amounts of the Retainer in
trust during the pendency of this case to be applied to any
professional fees, charges and disbursements that remain unpaid
at the end of this case.

BP&M will charge AMERCO for legal services at its standard hourly
rates:

          Legal Assistants          $75 - 125
          Law Clerks                      110
          Associates                115 - 250
          Partners                  300 - 400

Moreover, Ms. Peck states, BP&M will seek reimbursement of related
charges, including telephone charges, photocopying, travel,
business meals, computerized research, messengers, couriers,
postage, witness fees and other fees related to trials and
hearings.

BP&M intends to apply to the Court for allowance of compensation
and reimbursement of expenses in accordance with applicable
provisions of the Bankruptcy code, the Bankruptcy Rules, the Local
Bankruptcy Rules for the District of Nevada and this Court's
order.

                          *    *    *

Judge Zive authorizes AMERCO, on an interim basis, to employ
Beesley, Peck & Matteoni, Ltd., as its co-counsel and conflicts
attorneys as of June 20, 2003. (AMERCO Bankruptcy News, Issue No.
2; Bankruptcy Creditors' Service, Inc., 609/392-0900)


AMERICAN AIRLINES: June System Load Factor Up 3.6 Pts. to 78.8%
---------------------------------------------------------------
American Airlines reported a June system load factor of 78.8
percent, up 3.6 points from a year ago. With systemwide capacity
down 7.7 percent compared to June 2002, traffic declined 3.2
percent. Domestic traffic was down 4.1 percent year over year for
June on a capacity decrease of 9.4 percent. International traffic
in June was down 1.0 percent year over year on a capacity decrease
of 3.2 percent compared to June 2002.

American boarded 7.99 million passengers in June, down 6.5 percent
from June 2002.

AMR knows America's spacious skies well -- its main subsidiary is
American Airlines, the US's #2 air carrier based on revenue
passenger miles (behind UAL's United Airlines). With a fleet of
nearly 700 jetliners and hubs in Chicago, Dallas/Fort Worth,
Miami, and San Juan, Puerto Rico, American Airlines serves about
170 destinations in the Americas, Europe, and the Pacific Rim
(some through code-sharing). The carrier will expand by absorbing
the assets of TWA, which AMR has acquired. With British Airways,
American Airlines leads the Oneworld global marketing alliance.
AMR's regional feeder subsidiary, American Eagle, has been
aggressive in rolling out regional jet service.


AMES DEPARTMENT: Trade Creditors Sell 12 Claims Totaling $1.8MM
---------------------------------------------------------------
From June 12 to 24, 2003, the Clerk of Court recorded $1,892,267
in claims transfers.  Of this amount, Amroc Investments LLC bought
six claims totaling $196,355.  Laurel Kittaning purchased two
claims from the Prudential Insurance Company of America. Capital
Markets also took three claims (against Ames Department Stores,
Inc.) totaling $58,770.  First International Bank went home with
Stone-Cline Home Fashions' claim for $590,864.

Original Claimant           Transferee                     Amount
-----------------           ----------                     ------
Fierce for the Children     Amroc Investments LLC         $64,432
Outel Products              Amroc Investments LLC          17,316
Hago Lingerie, Inc.         Amroc Investments LLC          31,016
Bess Manufacturing Co.      Amroc Investments LLC          33,612
BMC Weathersfield           Amroc Investments LLC          16,081
Eight in One Pet Products   Amroc Investments LLC          33,898
Shalom & Company            Capital Markets                26,280
ASB Distributor, Inc.       Capital Markets                 3,840
Brentwood Originals         Capital Markets                28,650
Stone-Cline Home Fashions   First International Bank      590,864
Prudential Insurance Co.    Laurel Kittaning              523,139
Prudential Insurance Co.    Laurel Kittaning              523,139
(AMES Bankruptcy News, Issue No. 39; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


ANIXTER: Fitch Rates $125 Mill. Zero Coupon Senior Notes at BB+
---------------------------------------------------------------
Fitch Ratings has assigned a 'BB+' rating to Anixter
International's issuance of $125 million in zero coupon
convertible senior notes due 2033. The zero coupon convertible
senior notes are subordinate to Anixter Inc.'s senior unsecured
debt. Simultaneously, Fitch has affirmed Anixter's senior
unsecured debt at 'BBB-' and Anixter International's existing zero
coupon convertible senior notes due 2020 at 'BB+'. The company
expects to use the majority of the proceeds of the offering to
repurchase outstanding debt and to a lesser extent equity
securities, as well as for general corporate purposes. The Rating
Outlook is Stable.

The ratings and Stable Outlook reflect Anixter's strong market
position, solid liquidity position, manageable near-term debt
obligations and modest capital spending requirements. In addition,
Fitch recognizes the company's industry-leading margins and
stabilizing revenue stream. Credit concerns continue to include
the competitive pricing environment within the company's markets
and the continued sluggishness in information technology spending.
In addition, the shift to maintenance based from capital based
spending continues and the timing of a turnaround in the
distribution industry remains uncertain.

Anixter has good financial flexibility that is supported by
approximately $24 million in cash, a $225 million accounts
receivable securitization program (of which $128.5 million was
outstanding as of April 4, 2003) and a recently amended $275
million five-year revolving credit facility maturing October 2005
(of which $68 million was outstanding as of April 4, 2003). In
addition, the company continued to generate positive free cash
flow in the first quarter of 2003 as a result of working capital
efficiencies, which enhanced liquidity. Fitch believes the
company's current resources are more than adequate to satisfy its
near-term debt obligations as the company has no significant
maturities until the potential put of its zero coupon convertible
notes in 2005. Fitch anticipates that the proceeds from this debt
issuance will be used to repurchase a majority of the outstanding
zero coupon convertibles, reducing the company's refinancing risk
from the potential put in 2005.

While Anixter's operations had been negatively affected by the
economic downturn and the low levels of IT spending over the past
couple of years, revenues and EBITDA appear to have stabilized.
Total revenues for year-end 2002 were $2.5 billion, down
approximately 20% from $3.1 billion in 2001. However, excluding
the impact of the Pentacon acquisition in September 2002, total
revenues on a pro-forma basis remained in the $612 million-$619
million range since the first quarter of 2002. Including the
impact of Pentacon, revenues grew steadily since the third quarter
of 2002 and by approximately 2% on an LTM basis for the quarter
ended April 4, 2003. As the company has indicated that revenues
for the second quarter of 2003 would be negatively affected by the
number of shipping days in the quarter as well as by the ongoing
shifts in spending to maintenance based from capital based, Fitch
does not expect the company's top line to exhibit growth for the
remainder of 2003. Importantly, the company's gross and operating
margins have remained high relative to its peers, with the gross
margin holding steadily in the 23%-24% range since 2000 and the
EBITDA margin remaining in the 4.3%-4.6% range since the first
quarter of 2002, as the company has been managing its cost
structure.

Anixter has maintained strong credit protection measures by
managing its debt levels. During 2002, the company utilized free
cash flow to repurchase $378 million face value of its zero coupon
convertible notes due 2020 as well as approximately $10 million of
its senior notes due October 2003. Total on-balance sheet debt was
$200.2 million at the end of the first quarter ended April 4,
2003, including $126.1 million in zero-coupon convertibles, $6
million in senior notes and $68 million from the revolving credit
facility. Credit protection measures have remain relatively
consistent year over year with leverage (as measured by total
debt/EBITDA) at 1.8 times and coverage (as measured by
EBITDA/interest - excluding non-cash interest accretion from the
convertible notes) at 17.4x on an LTM basis for the quarter ending
April 4, 2003. For the same period, adjusted leverage (including
securitizations and rents) was 4.4x on an LTM basis compared to
4.5x for year-end 2002 and 3.8x for year-end 2001.


BCE INC: Wilfred Shaw Amends $1 Billion Class Action Lawsuit
------------------------------------------------------------
BCE Inc. announced that Mr. Wilfred Shaw has filed an amended
statement of claim in connection with the $1 billion lawsuit
originally filed on September 27, 2002, against BCE Inc. and BCI.
This follows the decision of the Ontario Superior Court of
Justice, on May 9, 2003, dismissing Mr. Shaw's original motion for
certification of the lawsuit as a class action and striking out
the original statement of claim as disclosing no reasonable cause
of action.

The plaintiff again seeks Court approval to proceed by way of
Class action, on behalf of all persons who owned BCI common shares
on December 3, 2001, in connection with the issuance of BCI common
shares on February 15, 2002 pursuant to BCI's Recapitalization
Plan and the implementation of BCI's Plan of Arrangement approved
by the Ontario Superior Court of Justice on July 17, 2002.

BCE remains of the view that the allegations contained in the
lawsuit are without merit and intends to take all appropriate
actions to vigorously defend its position.

BCE is Canada's largest communications company. It has 25 million
customer connections through the wireline, wireless, data/Internet
and satellite services it provides, largely under the Bell brand.
BCE's media interests are held by Bell Globemedia, including CTV
and The Globe and Mail. As well, BCE has e-commerce capabilities
provided under the BCE Emergis brand. BCE shares are listed in
Canada, the United States and Europe.

At Dec. 31, 2002, BCE Inc. reported a total working capital
deficit of about CDN$2.3 billion.


BMC INDUSTRIES: Credit Facility Waiver Discussions Continue
-----------------------------------------------------------
BMC Industries, Inc., (NYSE:BMM) announced that discussions with
its lenders continue regarding a waiver to its credit facility. As
of June 30, the company became non-compliant with certain
covenants under its credit facility, including the non-payment of
certain scheduled principal payments and fees.

BMC Industries, founded in 1907, comprises two business segments:
Buckbee-Mears and Optical Products. The Buckbee-Mears group offers
a range of services and manufacturing capabilities to meet the
most demanding precision metal manufacturing needs. The group is a
leading producer of a variety of precision photo-etched and
electroformed components that require fine features and tight
tolerances. The group is also the only North American manufacturer
of aperture masks, a key component in color television picture
tubes.

The Optical Products group, operating under the Vision-Ease Lens
trade name, is a leading designer, manufacturer and distributor of
polycarbonate, glass and plastic eyewear lenses. Vision-Ease is a
technology and a market share leader in the polycarbonate lens
segment of the market. Polycarbonate lenses are thinner and
lighter than lenses made of other materials, while providing
inherent ultraviolet (UV) filtering and impact resistant
characteristics.

BMC Industries, Inc., is listed on the New York Stock Exchange
under the ticker symbol "BMM." For more information about BMC
Industries, Inc., visit the Company's Web site at
http://www.bmcind.com


BUDGET GROUP: Has Until July 29 to Make Lease-Related Decisions
---------------------------------------------------------------
U.S. Bankruptcy Court Judge Walrath extends the time within which
Budget Group Inc., and its debtor-affiliates must assume, assume
and assign, or reject all of their Unexpired Leases under Section
365(d)(4) of the Bankruptcy Code through and including July 29,
2003. (Budget Group Bankruptcy News, Issue No. 22; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


CASCADES INC: Closes Sale of Additional $100-Mill. Senior Notes
---------------------------------------------------------------
Cascades Inc. (CAS-TSX) has completed the sale of US$100 million
of its 7-1/4% Senior Notes due 2013 in a private placement to
institutional investors. The notes are unsecured obligations of
Cascades and are guaranteed by certain of Cascades' Canadian and
U.S. subsidiaries.

The proceeds of this sale will be used to reduce indebtedness
under the Company's revolving credit facility.

                         *   *   *

As reported in Troubled Company Reporter's February 7, 2003
edition, Standard & Poor's Ratings Services raised its rating on
Cascades Inc.'s US$450 million senior unsecured notes to 'BB+'
from 'BB'. At the same time, the 'BB+' long-term corporate
credit rating and 'BBB-' senior secured debt rating on the
diversified paper and packaging producer were affirmed. The
outlook is stable.


CENTERPOINT ENERGY: Remarkets $150 Mill. Pollution Control Bonds
----------------------------------------------------------------
CenterPoint Energy, Inc., (NYSE: CNP) announced that a new, long-
term interest rate of 4 percent is expected to be established for
two outstanding series of pollution control bonds issued on behalf
of the company by two governmental authorities.  The remarketed
bonds, totaling $150.85 million, include $91.945 million issued by
the Brazos River Authority and $58.905 million issued by the
Matagorda County Navigation District Number One.  The bonds were
initially issued in July 1995 at an interest rate of 5.8 percent.
The new interest rate is expected to become effective on July 9,
2003.  The bonds will mature in 2015.

CenterPoint Energy's installment payment obligations are
collateralized by first mortgage bonds of its electric
transmission and distribution subsidiary, CenterPoint Energy
Houston Electric, LLC.  Payment of the principal of and interest
on the bonds when due is guaranteed by a financial guaranty
insurance policy issued by MBIA.  Proceeds from the remarketing
will be used to repay current holders of the remarketed bonds when
they are purchased in lieu of redemption.

The remarketing of the bonds is not required to be registered
under the Securities Act of 1933.  This news release does not
constitute an offer to sell, or the solicitation of an offer to
buy any security and shall not constitute an offer, solicitation
or sale in any jurisdiction in which such offering would be
unlawful.

                         *   *   *

As reported in Troubled Company Reporter's March 5, 2003 edition,
Fitch Ratings affirmed the outstanding credit ratings of
CenterPoint Energy, Inc., and its subsidiaries CenterPoint Energy
Houston Electric LLC and CenterPoint Energy Resources Corp.  The
Rating Outlook for all three companies remains Negative.

         The following ratings were affirmed by Fitch:

                   CenterPoint Energy, Inc.

       -- Senior unsecured debt 'BBB-';
       -- Unsecured pollution control bonds 'BBB-';
       -- Trust originated preferred securities 'BB+';
       -- Zero premium exchange notes 'BB+'.

             CenterPoint Energy Houston Electric, LLC

       -- First mortgage bonds 'BBB+';
       -- $1.3 billion secured term loan 'BBB'.

              CenterPoint Energy Resources Corp.

       -- Senior unsecured notes and debentures 'BBB';
       -- Convertible preferred securities 'BBB-'.


CHART IND.: Extends Bank Waivers & Defers Debt Service Payments
---------------------------------------------------------------
Chart Industries, Inc.'s (OTCPK:CTIT) senior lenders have
tentatively agreed to further extend certain bank waivers and
deferral of debt service payments until July 15, 2003. The
agreement is subject to final approval by Chart's senior lenders.

On May 1, 2003, Chart announced that it had reached an agreement
in principle with its lenders to financially restructure the
Company. At that time the Company's senior lenders also agreed to
grant an extension through June 30, 2003 of previously announced
waivers and deferral of debt service payments. Chart and its
senior lenders have continued working towards finalizing the terms
of its debt restructuring. The extension until July 15 is intended
to give the parties sufficient time to accomplish that goal. As
previously announced, it is expected that, among other things, the
terms of the Company's proposed debt restructuring will result in
substantial dilution of current shareholders of the Company,
leaving them with approximately 5% of the equity of the
restructured Company, plus warrants which, under certain
conditions, will provide them with an opportunity to acquire up to
an additional 5% of Company equity after the restructuring is
completed.

"We continue to make significant progress and expect that our debt
restructuring arrangements will be finalized in the next two
weeks," said Arthur S. Holmes, Chart's Chairman and Chief
Executive Officer. "The extensions are indicative of our mutual
desire to achieve a consensual restructuring plan that is in the
best interests of all parties involved."

Chart Industries, Inc., is a leading global supplier of standard
and custom-engineered products and systems serving a wide variety
of low-temperature and cryogenic applications. Headquartered in
Cleveland, Ohio, Chart has domestic operations located in 11
states and an international presence in Australia, China, the
Czech Republic, Germany and the United Kingdom. For more
information on Chart Industries, Inc. visit the Company's Web site
at http://www.chart-ind.com


CINCINNATI BELL: S&P Maintains Watch Over Proposed Note Issue
-------------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings on
Cincinnati, Ohio-based telecommunications service provider
Cincinnati Bell Inc. (formerly known as Broadwing Inc.) and
subsidiaries on CreditWatch with positive implications following
the company's disclosure that it plans to issue approximately $300
million of senior unsecured notes. Proceeds will be used to repay
debt outstanding under the company's term and revolving credit
facilities.

"The CreditWatch reflects the fact that proceeds from the new
notes will enable Cincinnati Bell to significantly address a
looming liquidity issue in 2006," said Standard & Poor's credit
analyst Michael Tsao. Upon completion of the new notes issuance,
Standard & Poor's expects to raise the corporate credit rating on
Cincinnati Bell to 'B' from 'B-' and assign a positive outlook.
The company had total debt of about $2.5 billion at March 31,
2003.

Cincinnati Bell has a strong business risk profile. As the result
of its recent disposition of the long-haul data business (i.e.
Broadwing Communications Inc.), Cincinnati Bell has strengthened
its business risk profile by concentrating on its solid incumbent
local exchange carrier business and its wireless operation. The
ILEC business, which is run through its Cincinnati Bell Telephone
Co. subsidiary, is well managed and less vulnerable to competition
than regional Bell operating companies. The wireless operation
enjoys strong market share and has industry-leading operating
metrics. The constraining factor on the ratings is substantial
financial risk after the company incurred debt to finance the
unsuccessful Broadwing Communications venture. This left
Cincinnati Bell aggressively leveraged with debt-to-annualized
EBITDA of about 4.5x for the quarter ended in March 2003.

After issuing the new notes, Cincinnati Bell will have
significantly reduced a liquidity concern in 2006. Based on
assumptions that incorporate annual free cash flows of up to about
$250 million and the company's current debt amortization schedule,
Cincinnati Bell was originally forecasted to have sufficient
liquidity to meet only about $300 million out of about $730
million due in 2006. The new notes will allow the company to
reduce this potential funding gap to a far more manageable $130
million.

Cincinnati Bell -- whose latest balance sheet shows about $2
billion of total shareholders' equity deficit -- provides local,
long distance, wireless, and digital subscriber line services in
the greater Cincinnati metropolitan area. Its ILEC operation,
which serves more than one million access lines, accounts for
about 70% of total revenues and 80% of EBITDA. Due to the
company's aggressive use of service bundling, its deployment of
digital subscriber line service, and its relatively small market
area, this operation will likely continue to face very limited
competition in the next several years. Its wireless operation,
which has 28% market share, accounts for about 22% of total
revenues and 19% of EBITDA. This operation has historically been
solid, with industry leading average revenue per user and low
churn.


CLAYTON HOMES: Orbis Urging Shareholders to Nix Berkshire Offer
---------------------------------------------------------------
Orbis Investment Management Limited released the following open
letter to fellow Clayton Homes (NYSE: CMH) shareholders urging
them to vote against Clayton Homes' proposed acquisition by
Berkshire Hathaway (NYSE: BRK.A) (NYSE: BRK.B) at the special
meeting scheduled for July 16, 2003 in Knoxville, TN.:

           An Open Letter to Clayton Homes Shareholders
             from Orbis Investment Management Limited

                                July 1, 2003

Dear Clayton Homes Shareholder:

On April 1, 2003 Clayton Inc., announced its intention to merge
with a subsidiary of Berkshire Hathaway. We oppose this
transaction and intend to vote our 5% holding in Clayton against
the transaction at the special meeting scheduled for July 16, 2003
in Knoxville, Tennessee. We urge you -- our fellow shareholders --
to join us in opposing this transaction.

We believe that Clayton Homes is worth well over $12.50 per share
and absent the proposed transaction would be trading at over
$15.00 [Tues]day. The Clayton Board proposes that you sell your
Clayton stock at a price that is well below both the price it
would otherwise trade at [Tues]day and its long-term value.

-- Current market indications support our view that Clayton stock
    would be trading well above $12.50 today were it not for the
    proposed transaction.

-- The outlook for the manufactured housing industry is improving,
    coming off a cyclical trough.

-- The Board's claim that it needs to sell the company to secure
    alternative financing sources is not supported by the facts.

-- The Board adopted a flawed sale process and relied upon a
    fairness opinion from Morgan Keegan that significantly
    undervalued the company.

-- The bottom of the cycle is the wrong time to be selling a great
    company in a highly cyclical industry. We believe in the long-
    term fundamentals of the manufactured housing industry and that
    Clayton is an outstanding company with a great future.

-- Every vote from every Clayton shareholder can make a
    difference.

                The Realities of the Market Indicate
                  that $12.50 Per Share is Too Low

Since this transaction was announced, it has become increasingly
clear that the Board's proposal to sell the company for $12.50 per
share was an over-reaction to a severely depressed industry
environment that was ripe for a classic cyclical recovery. In
three short months, a number of significant market and industry
factors have changed for the better. But Clayton shareholders have
not benefited because the Board's approval of the sale of the
company for $12.50 per share has capped the share price.

Orbis believes that developments since the merger bid was
announced imply that Clayton stock would currently be trading well
above the $12.50 bid price including:

-- Clayton's share price has traded consistently above the $12.50
    bid price since June 3, 2003, indicating that the market
    believes the stock would trade at a higher price should the
    merger not be completed.

-- A recent manufactured housing communities transaction
    effectively valued Clayton's communities division at twice the
    value assigned in the Morgan Keegan fairness opinion(1); while
    we estimate that the manufacturing and retail, finance and
    insurance segment comparables used in the fairness opinion have
    since risen in price by over 30% on average.

-- US stock market valuations have risen substantially since the
    deal was announced, illustrating that share prices were
    artificially depressed during the time of the Iraq war when the
    merger price was agreed.

             The Industry Environment is Improving

Orbis believes the substantially higher current market valuations
of Clayton's competitors are not temporary but are sustainable and
reflect a fundamentally improved industry environment.

-- U.S. Bancorp, the eighth-largest financial services company in
    the US, announced on June 27 that it would begin offering
    financing for manufactured housing. Commenting on this news, a
    leading industry analyst said: "Signs that new ... lender
    entrants are imminent should mute concern about weak expected
    near-term results and allow the market to look with renewed
    confidence toward a more prospective 2004 and 25%+ [industry]
    shipment growth."(2)

-- In Texas, the largest market for manufactured housing, a new
    law became effective on June 18 reversing legislation which had
    severely depressed manufactured housing shipments.

-- Indications are that the overhang of repossessed homes, which
    crowd out new shipments, will evaporate in 2004.(2)

              The Company Does Not Need to be Sold
                to Continue to Access Financing

The Board's claim that it needs to sell the company to secure
sufficient financing to continue normal operations is not
supported by the improved environment for manufactured housing
financing as well as:

-- Clayton's Vanderbilt subsidiary is the only remaining
    manufactured housing mortgage originator with access to the
    securitization markets. That is due to its loans performing
    well despite an extremely adverse lending environment. Far from
    being a sign that Vanderbilt's access to financing may dry up,
    we believe this only reinforces the strength of their lending
    practices and therefore continued access to the securitization
    markets.

-- Vanderbilt was able to securitize a $392 million pool in
    November of last year while Oakwood Homes, a major competitor,
    was in bankruptcy and Conseco, the largest manufactured housing
    lender, was experiencing serious financial difficulties that
    ultimately led to it filing for Chapter 11 bankruptcy
    protection weeks later. Vanderbilt also securitized a further
    $290 million pool in February of this year.

        The Merger Process and Fairness Opinion are Flawed

Orbis believes that the onerous terms agreed to by Clayton's Board
with Berkshire Hathaway effectively prevented the testing of the
merger price in the market by dissuading other potential suitors
from coming forward. In particular, the terms precluded Clayton's
management from contacting other potential purchasers.

We agree with the statement issued June 30 by our fellow
shareholder Third Avenue Management LLC that the assumptions used
by Morgan Keegan in the fairness opinion are flawed and
substantially undervalue Clayton's true worth. Further evidence of
this is provided by:

-- The announcement on May 29 of the acquisition of Chateau
    Communities, Inc. (NYSE: CPJ), an owner and operator of
    manufactured home communities in the U.S. by Hometown America
    L.L.C. This transaction implies a valuation for Clayton's
    communities division of $4.00-$5.00 per share.(1) Morgan
    Keegan, in its fairness opinion rendered in late March,
    assigned a valuation range for this division of Clayton of only
    $1.91-$2.54 per share.

                Clayton Homes is a Great Company

Clayton has grown shareholders' equity at a rate of 19.5% annually
over the past 20 years based on an innovative and demonstrably
superior business model that others have failed to emulate. As a
result, during the current industry downturn a number of Clayton's
largest competitors have filed for bankruptcy protection and all
have been forced to reduce manufacturing capacity and retail
outlets. Against this backdrop of dramatic industry capacity
reductions, Clayton's operations have remained intact and
profitable allowing the company to grow market share from 7.5% to
over 11.5%. We believe Clayton is therefore in an ideal position
to benefit from earnings growth and increased market share when
the industry's cyclical recovery begins.

"Clayton Homes is far and away the premier company in the
Manufactured Housing Industry with high quality products and
outstanding leadership and personnel. By retaining discipline,
Clayton Homes is the lone tower of strength in an industry
battered in recent years by the consequences of lax financing
practices."

           Warren Buffett, CEO, Berkshire Hathaway)

In summary, the Board proposes you sell your Clayton stock at a
price that is well below both the price it would otherwise trade
at today and its long-term value. In recommending the merger, they
have relied on a fairness opinion that is flawed and has since
been shown to significantly underestimate the value of the
company. The Board's position that the company has no choice other
than to sell itself at a time when industry valuations are
severely depressed is unsubstantiated by market realities. On the
contrary, there is mounting evidence that financing for
manufactured housing is becoming more available and the industry
is on the cusp of a strong cyclical recovery.

              Your Vote Can Make a Difference

Orbis Funds have been Clayton shareholders for more than four
years. We believe the company has terrific growth prospects and is
worth well more than $12.50 per share. To protect the value of
your investment, we urge you to join us in voting against this
transaction at the July 16th meeting.

                                Sincerely,
                                   /s/ William Gray
                                William Gray
                                President
                                Orbis Investment Management Limited

Orbis Investment Management Ltd. is an investment management firm
with more than $2 billion under management. Orbis serves investors
around the world through a broad range of award winning equity
mutual funds as well as a number of alternative investment
products. Its AAA rated flagship fund, the Orbis Global Equity
Fund, was recently recognized by Standard & Poor's as the top
performing global equity fund in its sector for the ten year
period ended December 31, 2002. For additional information about
Orbis, visit http://www.orbisfunds.com

                          *     *     *

As reported in Troubled Company Reporter's April 9, 2003 edition,
the ratings of Clayton Homes, Inc., and some of its Vanderbilt
Mortgage manufactured housing securitizations were placed on
Rating Watch Positive by Fitch Ratings. Currently, Fitch has an
indicative senior unsecured rating of 'BB+' for Clayton Homes.


COLONIAL ADVISORY: S&P Further Junks Class B Notes Rating at CC
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on the class
B notes issued by Colonial Advisory Services CBO I Ltd.

Standard & Poor's also affirmed its rating on the same issuer's
class A notes. At the same time, the ratings are removed from
CreditWatch with negative implications, where they were placed
April 16, 2003. The rating on the class B notes was previously
lowered three times; the most recent downgrade occurred Nov. 12,
2002.

The lowered rating reflects factors that have negatively affected
the credit enhancement available to support the notes since the
previous rating action. These factors include a continuing par
erosion of the collateral pool securing the notes and a downward
migration in the credit quality of the assets in the pool.

The affirmation reflects the existence of an adequate level of
credit enhancement to support the class A notes. As a result of
asset defaults and the sale of credit risk assets, the class B
overcollateralization ratio has dropped significantly, and now
stands at 95.7%, compared with 99.5% at the time of the last
rating action and well below its 118% benchmark. Standard & Poor's
noted that the interest payment for the class B notes was deferred
for the previous two payment dates.

Including defaulted securities, $103.3 million (or approximately
36.6% of the collateral pool's par value) comes from obligors now
rated in the 'CCC' range or lower, and $19.5 million (or about
9.2% of the performing assets in the pool) correspond to obligors
with ratings that are currently on CreditWatch with negative
implications.

The weighted average coupon, which had been slowly trending down
since mid-1999, accelerated its decline in late 2001, and
subsequently dipped below its minimum requirement of 9.55%. It
reached its lowest point of 9.09% in August 2002, and has tended
to stabilize since; it now stands at 9.11%.

Standard & Poor's has analyzed the results of current cash flow
runs for Colonial Advisory Services CBO I Ltd. to determine the
future default levels the rated tranches can withstand under
different default timings and interest rate scenarios, while still
being able to honor all interest and principal payments coming due
on the notes. This analysis led to the conclusion that the rating
assigned to the class B notes was no longer consistent with the
credit enhancement available, resulting in the lowered rating.

Standard & Poor's will continue to monitor the performance of the
transaction to ensure that the ratings assigned to the rated notes
continue to reflect the enhancement levels available to support
the new and affirmed ratings.

                         RATING LOWERED

              Colonial Advisory Services CBO I Ltd.

                      Rating                    Balance (mil. $)
         Class    To          From             Original   Current
         B        CC          CCC-/Watch Neg      64.00     73.33

                         RATING AFFIRMED

              Colonial Advisory Services CBO I Ltd.

                      Rating                    Balance (mil. $)
         Class    To          From             Original   Current
         A        AA-         AA-/Watch Neg      325.00    197.39


CONSECO FINANCE: Inks Pact to Sell Credit Accounts to B-Line LLC
----------------------------------------------------------------
The Conseco Finance Debtors want to enter into an Asset Purchase
Agreement between CFC, Mill Creek Bank and B-Line, LLC.  CFC wants
to sell loan or credit accounts established by CFC's customers who
have subsequently filed for bankruptcy protection and who have
reaffirmed their obligations to repay the remaining balances of
their accounts.  CFC is selling these Assets because they are no
longer integral to operations given the CFN and GE Transactions.

James H.M. Sprayregen, Esq., at Kirkland & Ellis, informs Judge
Doyle that B-Line will pay 39.7% of the aggregate of the unpaid
balances of the accounts.  This is expected to be around
$993,750.  The funds received will factor into the purchase price
adjustment for the GE Sale, potentially increasing the GE Sale
Price. (Conseco Bankruptcy News, Issue No. 27; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


CONSTELLATION BRANDS: Reports Improved Performance for Fiscal Q1
----------------------------------------------------------------
Constellation Brands, Inc. (NYSE: STZ and STZ.B, ASX: CBR)
reported record net sales and net income for its first quarter
ended May 31, 2003. Led by the benefit from the Hardy acquisition,
increased beer sales and lower average spirits costs, net income
on a comparable basis increased $10 million, or 26 percent, to
reach a record $47 million.

Net income and diluted earnings per share as reported under
generally accepted accounting principles for the first quarter
increased two million dollars, or five percent, to reach $39
million.

Net income on a comparable basis and diluted earnings per share on
a comparable basis exclude the after-tax impact of: an increase in
cost of goods sold resulting from the step up of inventory
associated with the Hardy acquisition; financing costs and the
imputed interest charge associated with the Hardy acquisition;
restructuring charges; and a gain on change in fair value of
derivative instruments.

Richard Sands, Chairman and Chief Executive Officer, said, "We are
pleased with our strong comparable earnings growth this quarter,
which was enhanced by our recent acquisition. The integration of
Hardy has gone very well and it is clear that Constellation has
already begun to experience tangible benefits from the
acquisition, particularly in the enhancement of our scale, breadth
and growth. Our company-wide business model of independent sales,
marketing and production teams has once again demonstrated its
flexibility, allowing us to adapt to changes in the marketplace
while maintaining close contact with our customers."

Sands added, "We remain focused on building long-term brand equity
and we continue to invest behind brands and sectors that have the
greatest potential for growth, while maintaining profitability on
more established brands. This approach to the market enabled us to
maintain a strong bottom line and we are on track to deliver our
fiscal year earnings goals."

Business Segments

As reported in its recently filed Form 10-K, the Company has
changed its organizational structure. Beginning with the first
quarter ended May 31, 2003, the Company is reporting its operating
results in three segments: Constellation Wines (branded wine, and
U.K. wholesale and other), Constellation Beers and Spirits
(imported beer and distilled spirits) and Corporate Operations and
Other. In accordance with the provisions of segment reporting, the
Company has elected to change its definition of operating income
for segment purposes to exclude restructuring and unusual costs
that affect comparability. This calculation of operating income
for segments reflects the measure currently used by management to
evaluate results.

Consolidated Results

For the three months ended May 31, 2003, net sales grew 19
percent, reaching $772 million compared to $650 million in the
prior year and includes a positive four percent impact from
foreign exchange. Net sales growth was driven primarily by the
addition of wine sales from the Hardy acquisition completed during
the quarter. Increases in U.K. wholesale sales and imported beer
sales also contributed to the growth. Net sales for the quarter on
an equivalent basis, including April and May sales from Hardy in
the prior year period of $85 million, increased five percent,
including a positive four percent impact from foreign exchange.

Gross profit on a comparable basis for the first quarter increased
21 percent to reach $213 million and gross margin on a comparable
basis improved 50 basis points to reach 27.7 percent. The increase
in gross profit and the improvement in gross margin for the
quarter resulted primarily from: sales from the Hardy acquisition;
higher average imported beer prices partially offset by higher
average imported beer costs; and lower average spirits costs.

Reported gross profit, which includes inventory step-up associated
with the Hardy acquisition of six million dollars, increased 18
percent to reach $208 million and reported gross margin declined
30 basis points to 26.9 percent.

First quarter selling, general and administrative expenses
("SG&A") on a comparable basis increased $12 million to reach $103
million. The majority of the increase resulted from expenses
associated with the Hardy acquisition. As a percent of net sales,
SG&A on a comparable basis were 13.3 percent compared to 14.0
percent for the prior year.

Reported SG&A increased $16 million to reach $107 million, and
includes four million dollars of financing costs (non-cash)
associated with the Hardy acquisition. As a percent of net sales,
reported SG&A were 13.8 percent, including a 50 basis point impact
from the financing costs, compared to 14.0 percent for the prior
year.

Operating income on a comparable basis increased to $111 million,
an increase of 29 percent versus $86 million in the prior year.
Reported operating income was $99 million, an increase of 15
percent, and includes: inventory step-up of six million dollars;
financing costs of four million dollars; and restructuring charges
of two million dollars.

Net interest expense on a comparable basis increased $10 million
to $37 million as a result of higher average borrowings due to the
financing of the Hardy acquisition, partially offset by a lower
average borrowing rate. Reported net interest expense for the
quarter increased $12 million to $39 million and includes two
million dollars of imputed interest expense related to the Hardy
acquisition.

As a result of the above factors, net income and diluted earnings
per share on a comparable basis for First Quarter 2004 increased
26 percent and 23 percent, respectively, reaching $47 million and
$0.49. Net income and diluted earnings per share on a reported
basis for First Quarter 2004 increased five percent and three
percent, respectively, reaching $39 million and $0.41.

Constellation Beers and Spirits Results

Net sales for First Quarter 2004 grew two percent to reach $277
million and operating income grew 10 percent to reach $60 million.
Imported beer sales increased four percent resulting from both
volume gains, particularly Corona Extra and Corona Light, and
higher average prices. The higher average prices resulted from a
price increase on the Company's Mexican portfolio, which took
effect in the first quarter of last year. Spirits sales were down
three percent on flat volume. The decline in sales was due
primarily to sales mix towards lower average priced brands.

The 10 percent increase in operating income for the quarter
resulted from higher beer sales and lower average spirits costs,
partially offset by increased imported beer costs and imported
beer advertising.

Constellation Wines Results

Net sales for First Quarter 2004 were $494 million compared to
$378 million the prior year, an increase of $116 million, or 31
percent. The increase was driven primarily by the addition of wine
sales from the Hardy acquisition and includes a positive six
percent impact from foreign exchange. Net sales on an equivalent
basis, including April and May branded wine sales from Hardy in
the prior period of $85 million, increased seven percent and
includes a positive six percent impact from foreign exchange.

Branded wine sales increased 45 percent and include a positive
three percent impact from foreign exchange. Branded wine sales on
an equivalent basis, including April and May sales from Hardy in
the prior year period of $83 million, increased four percent
driven by a positive impact from foreign exchange. Excluding the
impact from foreign exchange, branded wine sales were up slightly
on an equivalent basis as sales increased across all geographies:
U.S., Europe and Australasia.

The Company continues to face a challenging wine environment due
to competitive discounting driven in part by excess grape
supplies. The Company does not believe this is a long-term issue
and is pleased that its wine sales are growing in line with the
overall wine market in which the Company principally operates. The
Company has taken a strategy of preserving the long-term brand
equity of its portfolio and investing its marketing dollars in the
higher growth sectors of the wine business.

Wholesale and other net sales increased 13 percent driven by gains
in the U.K. wholesale business, and a positive 10 percent impact
from foreign exchange, partially offset by lower cider sales.

Operating income for First Quarter 2004 was $61 million, an
increase of 57 percent. The increase was primarily the result of
sales derived from the Hardy acquisition.

Items Affecting Comparability

Inventory step-up - The Hardy acquisition resulted in an
allocation of purchase price in excess of book value to certain
inventory on hand at the date of purchase. This allocation of
purchase price in excess of book value is referred to as inventory
step-up. The inventory step-up represents an assumed manufacturing
profit attributable to Hardy pre acquisition. For inventory
produced and sold after the acquisition date, the related
manufacturer's profit will accrue to the Company. The Company sold
acquired inventory having a step-up of six million dollars during
First Quarter 2004, resulting in higher cost of sales. The Company
expects additional step-up impacts of $14 million pre-tax over the
remainder of the fiscal year.

Financing costs - In connection with the Hardy acquisition, the
Company recorded amortization expense for deferred financing costs
associated with non-continuing financing, primarily related to the
bridge loan agreement. The Company recorded four million dollars
pre-tax in the first quarter and expects to incur additional
amortization expense of five million dollars pre-tax in the
remainder of the current fiscal year.

Restructuring charges - Restructuring charges resulted from the
realignment of business operations in the Company's wine division,
as previously announced in the fourth quarter of last fiscal year.
The Company recorded a restructuring charge of two million dollars
pre-tax in the first quarter and expects to incur additional
charges of approximately five million dollars pre-tax over the
remainder of the current fiscal year.

Imputed interest charge - In connection with the Hardy acquisition
and in accordance with purchase accounting, the Company was
required to take a one-time imputed interest charge of two million
dollars for the time period between when the Company obtained
control of Hardy and the date it paid shareholders.

Gain on change in fair value of derivative instruments - In
connection with the Hardy acquisition, the Company entered into
derivative instruments to cap the cost of the acquisition in U.S.
dollars. The one million-dollar gain represents the net change in
value of the derivative instruments from the beginning of the
first quarter until the date Hardy shareholders were paid.

Exiting U.S. Commodity Concentrate Product Line

The Company has made a decision to exit the commodity concentrate
product line located in Madera, California. The commodity
concentrate product line is facing declining sales and profits and
is not part of the Company's core business, beverage alcohol. The
Company will continue to produce and sell value-added, proprietary
products such as MegaColors.

Related to exiting commodity concentrate, the Company will sell
its Escalon facility, located in Escalon, California, and move all
remaining production and storage from Escalon to Madera and other
locations. By exiting commodity concentrate, the Company will free
up capacity at its winery in Madera and forego further investment
in its Escalon facility. The Company believes these steps will
simplify its wine operations and represent a better use of its
capital. The Company expects the restructuring project to improve
overall profitability and asset utilization resulting in increased
return on invested capital, and to be immediately cash flow
positive.

The total restructuring charge for exiting the commodity
concentrate product line and closing the Escalon Winery is
expected to be $56 million and will be spread out over the next
six quarters, beginning with an estimated $40 million in the
Second Quarter 2004. The charge results from renegotiating
existing grape contracts associated with commodity concentrate and
the Escalon facility, the write down of existing concentrate
inventory, asset write-offs and severance-related costs. More than
half of the charges are non-cash charges.

Outlook

The following statements are management's current operating income
expectations both on a comparable basis and a reported (GAAP)
basis for the second quarter ending August 31, 2003 and fiscal
year ending February 29, 2004:

- Operating income on a comparable basis for Second Quarter 2004
   is expected to be within a range of $138 million to $145 million
   versus $105 million for Second Quarter 2003.

- Operating income on a comparable basis for Fiscal 2004 is
   expected to be within a range of $560 million to $580 million
   versus $410 million for Fiscal 2003.

- Operating income on a reported (GAAP) basis for Second Quarter
   2004 is expected to be within a range of $79 million to $86
   million versus $105 million for Second Quarter 2003.

- Operating income on a reported (GAAP) basis for Fiscal 2004 is
   expected to be within a range of $467 million to $487 million
   versus $410 million for Fiscal 2003.

No earnings per share guidance is given, as alternative capital
structures in connection with refinancing the Company's $400
million bridge loan incurred as part of financing the Hardy
acquisition are under evaluation. The Company's final decision
could have an impact on its earnings per share.

Status of Business Outlook

During the quarter, Constellation may reiterate the estimates set
forth above under the heading Outlook. Prior to the start of the
Quiet Period, the public can continue to rely on the Outlook as
still being Constellation's current expectations on the matters
covered, unless Constellation publishes a notice stating
otherwise.

Beginning August 16, 2003, Constellation will observe a "Quiet
Period" during which the Outlook no longer constitutes the
Company's current expectations. During the Quiet Period, the
Outlook should be considered to be historical, speaking as of
prior to the Quiet Period only and not subject to update by the
Company. During the Quiet Period, Constellation's representatives
will not comment concerning the Outlook or Constellation's
financial results or expectations. The Quiet Period will extend
until the day when Constellation's next quarterly Earnings Release
is published, presently scheduled for Tuesday, September 30, 2003,
after market hours.

Constellation Brands, Inc. is a leading international producer and
marketer of beverage alcohol brands with a broad portfolio across
the wine, spirits and imported beer categories. The Company is the
largest multi-category supplier of beverage alcohol in the United
States; a leading producer and exporter of wine from Australia and
New Zealand; and both a major producer and independent drinks
wholesaler in the United Kingdom. Well-known brands in
Constellation's portfolio include: Corona Extra, Pacifico, St.
Pauli Girl, Black Velvet, Fleischmann's, Mr. Boston, Estancia,
Simi, Ravenswood, Blackstone, Banrock Station, Hardys, Nobilo,
Alice White, Vendange, Almaden, Arbor Mist, Stowells of Chelsea
and Blackthorn.

As previously reported, Standard & Poor's Ratings Services
assigned its 'BB' rating to beverage alcohol producer
Constellation Brands Inc.'s $1.6 billion senior secured credit
facilities and its $450 million senior unsecured bridge loan.

At the same time, Standard & Poor's affirmed its 'BB' corporate
credit and senior unsecured debt ratings on Constellation Brands,
as well as the 'B+' subordinated debt rating on the company.
Ratings for the bank facilities are based on preliminary
documentation and subject to review once final documentation is
received.


CONTINENTAL AIRLINES: Posts Record June Operational Performance
---------------------------------------------------------------
Continental Airlines (NYSE: CAL) reported an all-time record
systemwide mainline jet load factor of 81.0 percent for June 2003,
2.3 points above last year's June load factor and 0.6 points above
the previous record set in July 2000.  Continental reported an
all-time record domestic mainline jet load factor of 81.8 percent,
4.3 points above June 2002, and 2.6 points above the previous
record of June 2000.  Continental reported an international
mainline jet load factor of 79.8 percent for June 2003.

During the month, Continental recorded a DOT on-time arrival rate
of 81.4 percent and a systemwide completion factor of 99.9 percent
for its mainline jet operations.

In June 2003, Continental flew 5.4 billion mainline jet revenue
passenger miles (RPMs) and 6.6 billion mainline jet available seat
miles (ASMs) systemwide, resulting in a traffic decrease of 1.5
percent and a capacity decrease of 4.3 percent compared to June
2002.  Domestic mainline jet traffic was 3.3 billion RPMs in June
2003, up 3.4 percent from June 2002, and June 2003 domestic
mainline jet capacity was 4.1 billion ASMs, down 2.0 percent from
June 2002.

Systemwide June 2003 mainline jet passenger revenue per available
seat mile (RASM) is estimated to be relatively flat compared to
June 2002, with a year-over-year RASM change ranging from -1% to
+1%, while showing improvement in the second half of the month.
For May 2003, RASM increased 2.0 percent compared to May 2002.

Continental ended June 2003 with a record-high quarter end
consolidated cash and short-term investments balance of
approximately $1.62 billion (including $128 million of restricted
cash), which is an increase of approximately $440 million since
the end of the first quarter of 2003.

ExpressJet Airlines, a subsidiary of Continental Airlines doing
business as Continental Express, separately reported an all-time
record load factor of 73.5 percent for June 2003, 5.5 points above
last year's June load factor and 3.5 points above the previous
record set last month.  ExpressJet flew 538.9 million RPMs and
733.7 million ASMs in June 2003, resulting in a traffic increase
of 55.9 percent and a capacity increase of 44.2 percent versus
June 2002.


CWMBS INC: Fitch Rates Class B-3 and B-4 Cert. Ratings at BB/B
--------------------------------------------------------------
CWMBS, Inc.'s mortgage pass-through certificates, CHL Mortgage
Pass-Through Trust 2003-29 classes A-1, PO and A-R (senior
certificates, $486,499,999) are rated 'AAA' by Fitch Ratings. In
addition, Fitch rates class M ($6,500,000) 'AA', class B-1
($2,750,000) 'A', class B-2 ($1,500,000) 'BBB', class B-3
($1,000,000) 'BB' and class B-4 ($750,000) 'B'.

The 'AAA' rating on the senior certificates reflects the 2.70%
subordination provided by the 1.30% class M, 0.55% class B-1,
0.30% class B-2, 0.20% privately offered class B-3, 0.15%
privately offered class B-4 and 0.20% privately offered class B-5
(which is not rated by Fitch). Classes M, B-1, B-2, B-3, and B-4
are rated 'AA', 'A', 'BBB', 'BB' and 'B', respectively, based on
their respective subordination.

Fitch believes the above credit enhancement will be adequate to
support mortgagor defaults as well as bankruptcy, fraud and
special hazard losses in limited amounts. In addition, the ratings
also reflect the quality of the underlying mortgage collateral,
strength of the legal and financial structures and the master
servicing capabilities of Countrywide Home Loans Servicing LP, a
direct wholly owned subsidiary of Countrywide Home Loans, Inc.

The certificates represent an ownership interest in a pool of
conventional, fully amortizing, 20- to 30-year fixed-rate mortgage
loans, secured by first liens on one- to four-family residential
properties. As of the closing date (June 30, 2003), the mortgage
pool demonstrates an approximate weighted-average loan-to-value
ratio (OLTV) of 68.79%. Approximately 58.45% of the loans were
originated under a reduced documentation program. Cash-out
refinance loans represent 14.34% of the mortgage pool and second
homes 2.83%. The average loan balance is $493,089. The weighted
average FICO credit score is approximately 742. The three states
that represent the largest portion of mortgage loans are
California (50%), Colorado (4.35%) and New York (3.73%).

The collateral characteristics provided are based off the mortgage
loans as of the closing date. Fitch ensures that the deposits of
subsequent loans conform to representations made by CHL.

None of the mortgage loans are 'high cost' loans as defined under
any local, state or federal laws.

Approximately 95.28% and 4.72% of the mortgage loans were
originated under CHL's standard underwriting guidelines and
expanded underwriting guidelines, respectively. Mortgage loans
underwritten pursuant to the expanded underwriting guidelines may
have higher loan-to-value ratios, higher loan amounts, higher
debt-to-income ratios and different documentation requirements
than those associated with the standard underwriting guidelines.
In analyzing the collateral pool, Fitch adjusted its frequency of
foreclosure and loss assumptions to account for the presence of
these attributes.

CWMBS purchased the mortgage loans from CHL and deposited the
loans in the trust, which issued the certificates, representing
undivided beneficial ownership in the trust. For federal income
tax purposes, an election will be made to treat the trust fund as
a real estate mortgage investment conduit.


DAVITA: Strong Financials Prompt S&P to Affirm BB- Credit Rating
----------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its speculative-grade
'BB-' corporate credit rating on dialysis services provider DaVita
Inc. and revised the rating outlook to positive from stable. The
outlook change indicates that Standard & Poor's could raise
DaVita's ratings if the company continues to strengthen its
financial profile.

Since its aggressive recapitalization in April 2002, DaVita has
generated increasingly strong levels of operating cash flow
through expansion, cost management initiatives, and IT
investments. This has enabled the company to build cash and
deleverage on a debt to EBITDA basis. In addition, the pending
amendment of DaVita's $841.5 million bank term loan should reduce
borrowing costs and create more operating latitude under
covenants. Continued improvement could, if sustained, create
credit insulation against near-term risks that is more indicative
of a higher rating category. However, the timing and certainty of
an upgrade will be influenced by the ultimate results of a
government review of DaVita's billing practices and financial
relationships with physicians.

As of June 27, 2003, DaVita had about $1.46 billion of debt
outstanding, including a $125 million convertible subordinated
notes issue that will likely be redeemed in July 2003.

"DaVita's speculative-grade ratings reflect the company's
dependence on treatment for a single disease state, its
vulnerability to cuts or insufficient increases in third-party
reimbursement rates, cost-management challenges, and very
aggressive financial policies," said Standard & Poor's credit
analyst Jill Unferth. "These factors are partly offset by the
stabilizing effects of a recurring revenue stream, a large clinic
network with the No. 2 U.S. market position, and attractive growth
prospects."

Torrance, California-based DaVita owns and operates more than 500
clinics throughout the U.S. that mainly provide outpatient
hemodialysis and ancillary services to patients suffering from
chronic kidney failure. DaVita also provides acute inpatient
dialysis services at approximately 270 hospitals and conducts
clinical trials on renal devices and drugs for pharmaceutical and
medical-device firms.


DIAMETRICS MEDICAL: OTCBB Trading Commences Effective July 2
------------------------------------------------------------
Diametrics Medical, Inc. (Nasdaq:DMED) received notification from
the Nasdaq Listing Qualifications Panel that it had denied
Diametrics' request, after a hearing on June 5, 2003, for
continued listing on the Nasdaq SmallCap Market. Effective July 2,
2003, the Company's Common Stock was delisted from the market.

Diametrics' Common Stock is eligible for trading on the Over-the-
Counter Bulletin Board (OTCBB). The OTCBB is a regulated quotation
service that displays real-time quotes, last sale price, and
volume information in over-the-counter equity securities. OTCBB
securities are traded by a community of market makers that enter
quotes and trade reports through a sophisticated computer network.
Investors work through a broker/dealer to trade OTCBB securities.
Information regarding the OTC Bulletin Board, including stock
quotations, can be found on the internet at http://www.otcbb.com

Diametrics' ticker symbol will remain "DMED" on the OTCBB;
however, some internet quotation services add an "OB" to the end
of the symbol for the purpose of providing stock quotes (e.g.
DMED.OB).

"While the decision by Nasdaq is disappointing, it is not expected
to impact our business strategy," said Dave Kaysen, Diametrics'
President and Chief Executive Officer. "We are continuing to
aggressively grow our customer base, while pursuing significant
strategic business alternatives, which may include the sale of
segments of the business," said Kaysen.

Diametrics Medical is a leader in critical care technology. The
Company improves the quality of healthcare delivery through
products that provide immediate, accurate and cost-effective blood
and tissue diagnostic information. Primary products include the
IRMA(R)SL point-of-care blood analysis system; the Trendcare(R)
continuous blood gas monitoring system, including Paratrend(R) and
Neotrend(R) for use with adult, pediatric and neonatal patients;
the Neurotrend(R) cerebral tissue monitoring system; and the
Integrated Data Management System. Additional information is
available at the company's Web site, http://www.diametrics.com

Diametrics Medical's March 31, 2003 balance sheet shows a total
shareholders' equity deficit of about $2 million.


DICE INC: Ernst & Young Steps Down as Independent Accountants
-------------------------------------------------------------
Ernst & Young LLP resigned as the independent public accountants
of Dice, Inc., effective June 20, 2003.  The Company, on June 2,
2003, engaged the accounting firm of LWBJ, LLP as independent
public accountants for the year ending December 31, 2003.  The
decision to retain LWBJ, LLP as the Company's independent public
accountants was recommended by the Audit Committee of the
Company's Board of Directors and approved by the Company's Board
of Directors.

Ernst & Young LLP's report on the Company's financial statements
as of December 31, 2002, for the year ended December 31, 2002,
contained a going concern qualification.

As reported in Troubled Company Reporter's July 2, 2003 edition,
Dice Inc., emerged from bankruptcy, after the U.S. Bankruptcy
Court for the Southern District of New York confirmed the
Company's pre-arranged Joint Plan of Reorganization on June 24,
2003, and all conditions necessary for the Plan to become
effective were satisfied or waived.

Dice Inc. (OTC Bulletin Board: DICEQ) -- http://about.dice.com--
is the leading provider of online recruiting services for
technology professionals. Dice Inc. provides services to hire,
train and retain technology professionals through its two
operating companies, dice.com, the leading online technology-
focused job board, as ranked by Media Metrix and IDC, and
MeasureUp, a leading provider of assessment and preparation
products for technology professional certifications.


DVI EQUIPMENT: Fitch Concerned about Increased Performance Risk
---------------------------------------------------------------
Fitch Ratings places all DVI, Inc., sponsored medical equipment
and healthcare receivable asset-backed transactions on Rating
Watch Negative.

This action reflects the potential for increased operational and
performance risk as a result of the same factors that contributed
to Fitch's downgrade of DVI's senior unsecured rating to 'CCC'
from 'B+'

Fitch is concerned that reduced financial flexibility resulting
from the resignation of DVI's outside auditors and the Securities
and Exchange Commission's subsequent rejection of DVI's most
recent quarterly financial statements could ultimately pressure
ABS collateral performance. While heavily discounted in Fitch's
analysis, DVI's ability to continue to support the medical
equipment securitizations through substitutions and servicer
advances may be challenged, adding to the potential for
performance volatility. Further, DVI's announcement that they have
hired UBS Securities LLC to assist in conducting a review of the
strategic alternatives available could also result in additional
operational volatility.

Fitch's ABS Group will continue to work in conjunction with
Fitch's Financial Institutions Group, keeping current on DVI's
financial status, funding capabilities and auditor selection.
Additionally, Fitch expects to complete an on-site review of DVI's
operations in the near future, while maintaining dialogue with the
securitizations' trustees and, in the case of the equipment
securitizations, U.S. Bank, N.A., the named back up servicer.
Fitch will also continue to closely monitor performance of the
transactions, and will notify the market in the case of any
additional developments. Based on the above reviews, Fitch may
affirm or downgrade the classes listed below.

Fitch's action affects 60 classes ($1.8 billion) of 9 DVI medical
equipment transactions and five classes ($50.3 million) of 2 DVI
Business Credit healthcare receivable transactions as follows:

DVI Receivables VIII, L.L.C., Series 1999-1

      -- Class A-5 notes are rated 'AAA' and are placed on
         Rating Watch Negative.

      -- Class B notes are rated 'AA' and are placed on
         Rating Watch Negative.

      -- Class C notes are rated 'A' and are placed on
         Rating Watch Negative.

      -- Class D notes are rated 'BBB' and are placed on
         Rating Watch Negative.

      -- Class E notes are rated 'BB' and are placed on
         Rating Watch Negative.

DVI Receivables X, L.L.C., Series 1999-2, all outstanding classes;

      -- Class A-4 notes are rated 'AAA' and are placed on
         Rating Watch Negative.

      -- Class B notes are rated 'AA' and are placed on
         Rating Watch Negative.

      -- Class C notes are rated 'A' and are placed on
         Rating Watch Negative.

      -- Class D notes are rated 'BBB' and are placed on
         Rating Watch Negative.

      -- Class E notes are rated 'BB' and are placed on
         Rating Watch Negative.

DVI Receivables XI, L.L.C., Series 2000-1. all outstanding
classes;

      -- Class A-4 notes are rated 'AAA' and are placed on
         Rating Watch Negative.

      -- Class B notes are rated 'AA' and are placed on
         Rating Watch Negative.

      -- Class C notes are rated 'A' and are placed on
         Rating Watch Negative.

      -- Class D notes are rated 'BBB' and are placed on
         Rating Watch Negative.

      -- Class E notes are rated 'BB' and are placed on
         Rating Watch Negative.

DVI Receivables XII, L.L.C., Series 2000-2, all outstanding
classes;

      -- Class A-4 notes are rated 'AAA' and are placed on
         Rating Watch Negative.

      -- Class B notes are rated 'AA' and are placed on
         Rating Watch Negative.

      -- Class C notes are rated 'A' and are placed on
         Rating Watch Negative.

      -- Class D notes are rated 'BBB' and are placed on
         Rating Watch Negative.

      -- Class E notes are rated 'BB' and are placed on
         Rating Watch Negative.

DVI Receivables XIV, L.L.C., Series 2001-1, all outstanding
classes;

      -- Class A-3 and A-4 notes are rated 'AAA' and are placed on
         Rating Watch Negative.

      -- Class B notes are rated 'AA' and are placed on
         Rating Watch Negative.

      -- Class C notes are rated 'A' and are placed on
         Rating Watch Negative.

      -- Class D notes are rated 'BBB' and are placed on
         Rating Watch Negative.

      -- Class E notes are rated 'BB' and are placed on
         Rating Watch Negative.

DVI Receivables XVI, L.L.C., Series 2001-2, all outstanding
classes;

      -- Class A-3 and A-4 notes are rated 'AAA' and are placed on
         Rating Watch Negative.

      -- Class B notes are rated 'AA' and are placed on
         Rating Watch Negative.

      -- Class C notes are rated 'A' and are placed on
         Rating Watch Negative.

      -- Class D notes are rated 'BBB' and are placed on
         Rating Watch Negative.

      -- Class E notes are rated 'BB' and are placed on
         Rating Watch Negative.

DVI Receivables XVII, L.L.C., Series 2002-1, all outstanding
classes;

      -- Class A-2, A-3A and A-3B notes are rated 'AAA' and are
         placed on Rating Watch Negative.

      -- Class B notes are rated 'AA' and are placed on
         Rating Watch Negative.

      -- Class C notes are rated 'A' and are placed on
         Rating Watch Negative.

      -- Class D notes are rated 'BBB' and are placed on
         Rating Watch Negative.

      -- Class E notes are rated 'BB' and are placed on
         Rating Watch Negative.

DVI Receivables XVIII, L.L.C., Series 2002-2, all outstanding
classes;

      -- Class A-1 notes are rated 'F1+' and are placed on
         Rating Watch Negative

      -- Class A-2A, A-2B, A-3A and A-3B notes are rated 'AAA' and
         are placed on Rating Watch Negative.

      -- Class B notes are rated 'AA' and are placed on
         Rating Watch Negative.

      -- Class C notes are rated 'A' and are placed on
         Rating Watch Negative.

      -- Class D notes are rated 'BBB' and are placed on
         Rating Watch Negative.

      -- Class E notes are rated 'BB' and are placed on
         Rating Watch Negative.

DVI Receivables XIX, L.L.C., Series 2003-1, all outstanding
classes.

      -- Class A-1 notes are rated 'F1+' and are placed on
         Rating Watch Negative

      -- Class A-2A, A-2B, A-3A and A-3B notes are rated 'AAA'
         and are placed on Rating Watch Negative.

      -- Class B notes are rated 'AA' and are placed on
         Rating Watch Negative.

      -- Class C notes are rated 'A' and are placed on
         Rating Watch Negative.

      -- Class D notes are rated 'BBB' and are placed on
         Rating Watch Negative.

      -- Class E1 and E2 notes are rated 'BB' and are placed on
         Rating Watch Negative.

DVI Business Credit Receivables Corp. III, Series 1998-1

      -- Class B notes are rated 'AAA' and are placed on
         Rating Watch Negative.

      -- Class C notes are rated 'CCC' and remain on
         Rating Watch Negative.

DVI Business Credit Receivables Corp. III, Series 1999-1

      -- Class C notes are rated 'A' and are placed on
         Rating Watch Negative.

      -- Class D notes are rated 'BBB' and are placed on
         Rating Watch Negative.

      -- Class E notes are rated 'BB' and are placed on
         Rating Watch Negative.


DVI HEALTHCARE: Series 1998-1 Class C Rating Dives Down to CCC
--------------------------------------------------------------
Fitch Ratings downgrades the class C note of the DVI Business
Credit Receivables Corp. III, Series 1998-1 to 'CCC' from 'B+.'
The class C note is also placed on Rating Watch Negative.
The downgrade reflects Fitch's downgrade of DVI, Inc.


EMMIS COMMS: Completes 6 Radio Stations Asset Purchase Deals
------------------------------------------------------------
PR Newswire   July 1

Emmis Communications Corporation (Nasdaq: EMMS) has purchased
50.1% of a six-station radio cluster in Austin, Texas in a cash
transaction for approximately $105 million.  Sinclair Telecable,
Inc., owns the remaining 49.9% interest in the cluster.

The radio stations involved are KLBJ-AM (590 News-Talk), KLBJ-FM
(93.7 Rock), KGSR-FM (107.1, Adult Alternative), KROX-FM (101.5
Alternative), KEYI-FM (103.5 Oldies), and KXMG-FM (93.3, CHR).
Emmis also owns Texas Monthly in the market.

Sinclair had operated the radio stations in a partnership with LBJ
Broadcasting Company, L.P. since 1997.  As part of this
transaction, Emmis bought LBJ's stake in the partnership.
Sinclair then contributed the assets of KEYI-FM to the
partnership, leaving Emmis with a 50.1% interest and Sinclair with
a 49.9% interest.  Although Sinclair will have board
representation in the partnership, Emmis will manage the day-to-
day operations and has an option to buy Sinclair's 49.9% interest
in about five years.

Emmis Communications is an Indianapolis-based diversified media
firm with radio broadcasting, television broadcasting and magazine
publishing operations. Emmis' 23 FM and 4 AM domestic radio
stations serve the nation's largest markets of Los Angeles, New
York and Chicago, as well as Phoenix, St. Louis, Indianapolis,
Austin and Terre Haute, IN. In addition, Emmis owns two radio
networks, three international radio stations, 16 television
stations, award-winning regional and specialty magazines, and
ancillary businesses in broadcast sales and publishing.

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


ENCOMPASS SERVICES: Wants Nod for Valero Settlement & Compromise
----------------------------------------------------------------
On April 18, 2001, EDG Power Group, Inc., now known as Encompass
Services Corporation, and Valero Refining Company-California
entered into a Work Agreement under which EDG agreed to design,
engineer, and construct a cogeneration facility for Valero's
refinery located in Benicia, California.  The agreement was
amended three times -- first in August 14, 2001, then in
December 6, 2001, and recently in May 30, 2002.  The total
contract price for the Work Agreement, as amended, was
$25,750,997.  The construction commenced in 2001 and was to
complete by March 15, 2002.

Shayne Hurst Newell, Esq., in Weil, Gotshal & Manges LLP, in
Houston, Texas, relates that before the project's completion,
disagreements arose between the Debtors and Valero.  After the
Debtors started working on the project, both parties submitted
numerous proposed change orders, some of which have been approved
and many of which have not been approved and are disputed.
Valero also claims that the Debtors have significant post-
construction warranty obligations that they have failed to
fulfill and for which they remain liable.  Valero contends that
it has substantial unresolved damage claims against the Debtors
relating to alleged errors and omissions in the Debtors' design
and engineering of the Project as well as their alleged
negligence in the performance of the work.

To consensually resolve their claims and disputes, both the
Debtors and Valero engaged in extensive, arm's-length and good
faith negotiations, which culminated in a settlement agreement.

The Court-approved Settlement Agreement presents an exchange of
fair value among the parties and in no way unjustly enriches any
of them.  The Settlement also eliminates the attendant risk of
litigation to the Debtors or their affiliates.

In summary, the Settlement Agreement provides that:

     -- Valero will pay the Debtors $1,500,000 in full and complete
        satisfaction of any and all asserted or unasserted claims
        and causes of action which the Debtors or their affiliates
        may have against Valero under the Work Agreement, as
        amended, and under any and all proposed, or yet to be
        proposed, change orders;

     -- Valero will be granted a full and complete release with
        regard to any and all asserted or unasserted claims which
        the Debtors or any of their affiliates may have against
        Valero or any of its affiliates;

     -- The automatic stay will be lifted solely to permit Valero
        to pursue to final judgment any and all of its claims,
        actions and causes of action against the Debtors;

     -- The Debtors will satisfy all conditions in their insurance
        policies, including providing notice to their insurers of
        any lawsuit filed by Valero arising out of or in connection
        with the Work Agreement, the Project or the Notice and
        cooperating with their insurers in the defense of any
        claims asserted by Valero;

     -- The Debtors will assign any rights or claims they may have
        against their insurers under any policies providing
        coverage for the claims Valero may assert.  The assignment,
        however, is effective only in the event that the Debtors'
        insurers breach their duties to defend and duties to
        indemnify the Debtors against the claims asserted by Valero
        arising out of or relating to the Work Agreement, the
        Project and the Notice;

     -- Valero agrees that, in the event that it pursues claims
        against the Debtors arising from or related to the Work
        Agreement, the Project or the Notice, it will not be
        entitled to recover from the Debtors any amount for which
        the Debtors are held liable that is over and above or
        outside of insurance coverage;

     -- The Debtors represent that these insurance policies (a)
        are fully paid and remain in full force and effect for the
        term of the policy, (b) currently have total unexhausted
        coverage in excess of $15,000,000 even after considering
        and giving full credit to any and all claims made by third
        parties against the Debtors, and (c) will not be altered,
        amended or cancelled by them:

         1. Columbia Casualty Co. (E&O) Policy No.
            CPE 11-407-27-43,

         2. American International Specialty Lines (E&O Excess)
            Policy No. COPS 619 2250,

         3. Zurich American Insurance Co. (Property Excess) Policy
            No. IM 3548457,

         4. National Union Fire Insurance Co. of Pittsburgh
            (Umbrella) Policy No. BE 1392845,

         5. Liberty Mutual Insurance Co. Policy No.
            LQ1-B71-077194-021,

         6. ACE American Insurance Co. Policy No. XCP G20581499,

         7. Royal Insurance Co. of America Policy No. PHA 017197,

         8. ACE American Insurance Co. Policy No. XCP G20581499,

         9. St. Paul and Marine: American Co. Policy No.Q106800196,

        10. American Guarantee & Liability Co. Policy No.
            AEC 374210401,

        11. Great American Insurance Co. Policy No.
            TSE 9-82-46-71-02,

        12. Starr Excess Liability Insurance Policy No. 6394409,

        13. ACE Bermuda Market Policy No. ESR - 1073/5,

        14. Lexington Insurance Co. (Property) Policy No.8750235,
            and

        15. Continental Casualty Policy No. GL194323081

        The Debtors have no deductible, self-insured retention,
        reinsurance, fronting obligation or other obligation of
        reimbursement to or for the benefit of any insurer other
        than that which is expressly disclosed in the policies.
        The Debtors have not received any notice or other express
        or implied indication informing them or otherwise
        suggesting that the policies are not in force and effect,
        or that they are in breach of the policies in any respect
        or that claims have been made which could exhaust coverage
        below that represented;

     -- Nothing in the confirmed reorganization plan or any
        amendment, modification, or substitution will limit or
        modify Valero's rights as indicated in the Settlement
        Agreement.  Nothing in the Plan or any amendment or
        modification will require Valero to be the holder of an
        Allowed Litigation Claim as a condition to disbursement of
        any proceeds from any one or more of the Debtors' Insurance
        Carriers or will constitute a discharge of any liability to
        Valero;

     -- Valero will waive the right, if any, to collect any
        additional amounts from the Debtors and to limit recourse
        and recovery to the 15 insurance policies.  In exchange,
        the Debtors will assign to Valero any and all of its
        claims, actions or causes of action, and to the extent
        necessary, any and all rights or benefits of defense, it
        may have against any and all third parties including claims
        against any and all of its subcontractors arising out of
        the services rendered or the materials delivered in
        connection with the Work Agreement or the Project;

     -- With respect to the third party claims, whether asserted by
        a subcontractor or by the Debtors, the Debtors will
        cooperate with Valero regarding Valero's prosecution or
        defense of claims asserted by or against any or all of the
        third parties who have asserted or may assert claims
        against Valero or the Project.  This cooperation includes
        the Debtors':

        (a) voluntary production of documents and other tangible
            things pertaining to claims that may be asserted by or
            against their subcontractors;

        (b) voluntary production of documents and other tangible
            things pertaining to any defense that Valero may raise
            in response to any claims asserted by their
            Subcontractors;

        (c) voluntary production of documents and other tangible
            things pertaining to any potential counterclaim they,
            -- and Valero, by assignment -- may assert against
            the Subcontractors;

        (d) identification of and reasonable assistance in
            providing access to knowledgeable witnesses;

        (e) right to consult with and interview knowledgeable
            witnesses; and

        (f) right to consult with any experts engaged by them or on
            their behalf in connection with the Work Agreement or
            the work performed by the Subcontractors.

        The Debtors' production of the information will be made in
        Houston, Texas and will include any analysis, summaries or
        compilations of the documents or materials, whether
        electronic or otherwise and Valero will be granted the
        right to utilize electronic access where available; and

     -- the Debtors will release Valero from any and all claims
        that they may have against Valero, including any and all
        claims or causes of action under the Work Agreement or any
        related change orders or which otherwise relate to the
        Project in any respect. (Encompass Bankruptcy News, Issue
        No. 15; Bankruptcy Creditors' Service, Inc., 609/392-0900)


ENGAGE INC: US Trustee Appoints Official Creditors' Committee
-------------------------------------------------------------
The United States Trustee for Region 1 appointed three creditors
to serve on an Official Committee of Unsecured Creditors in
Engage, Inc.'s Chapter 11 cases:

        1. Otec Solutions, Inc.
           12 Hiltz Avenue
           Toronto, Ontario M4L 2N5
           Phone: 416 616-6506
           Fax: 416 297-9125
           Attn: Mr. Don Hoy

        2. AMR Research, Inc.
           Tow Oliver Street
           Boston, Massachusetts 02109
           Phone: 617 574-5266
           Fax: 617 956-0917
           Attn: Atty. Amy Morrissey

        3. Focus Technology Solutions
           222 International Drive, Suite 105
           Portsmouth, New Hampshire 03801
           Phone: 603 766-000 x 219
           Fax: 603 766-0060
           Attn: Jacquie Lewis, Controller

Official creditors' committees have the right to employ legal and
accounting professionals and financial advisors, at the Debtors'
expense. They may investigate the Debtors' business and financial
affairs. Importantly, official committees serve as fiduciaries to
the general population of creditors they represent. Those
committees will also attempt to negotiate the terms of a
consensual chapter 11 plan -- almost always subject to the terms
of strict confidentiality agreements with the Debtors and other
core parties-in-interest. If negotiations break down, the
Committee may ask the Bankruptcy Court to replace management with
an independent trustee. If the Committee concludes reorganization
of the Debtors is impossible, the Committee will urge the
Bankruptcy Court to convert the Chapter 11 cases to a liquidation
proceeding.

Engage, Inc., headquartered at Andover, Massachusetts sells
software that enables publishers, advertisers and merchants to
streamline the creation, approval, production and re-purposing of
advertising and other marketing material.  The Company filed for
chapter 11 protection on June 19, 2003 (Bankr. Mass. Case No. 03-
43655).  Kevin J. Walsh, Esq., at Mintz Kevin Cohn Ferris Glovsky
& Popeo, PC represents the Debtors in their restructuring efforts.
When the Company filed for protection from its creditors, it
listed $52,113,000 in total assets and $16,593,000 in total debts.


ENRON CORP: Clarifies Director Stanley Horton is Indemnified
------------------------------------------------------------
On May 8, 2002, the Court approved the Enron Corp. Debtors' key
employee retention, liquidation incentive and severance plan and
authorized the Debtors to extend to their current directors and
officers their right to indemnification on an administrative
expense priority basis.

It was unclear whether the May 8 Order included the Debtors'
direct and indirect non-debtor subsidiaries' directors and
officers.  Accordingly, the Debtors asked the Court to extend the
indemnification to include the Non-Debtor Directors and Officers.

On January 24, 2003, the Court approved the continuation of
indemnification of Non-Debtor Directors and Officers, which
provides that the Court may approve the administrative expense
priority treatment of indemnification claims arising from
postpetition services of Non-Debtor Directors and Officers not
otherwise covered by the Order after notice and the opportunity
for a hearing.

At present, Stanley C. Horton is named as defendant in the Newby
litigation.  The Debtors believe that Mr. Horton is an integral
part of the reorganization process.  He is a director and officer
of Debtor companies Calypso Pipeline LLC, Enron Processing
Properties, Inc. and Enron Transportation Services Company.  Mr.
Horton is also an insider of Enron Corp. and a director of
officer in 30 non-Debtor subsidiaries and companies. Accordingly,
the Debtors believe that Mr. Horton's experiences and
relationships, coupled with the credibility gained from
successfully managing and cultivating the Enron natural gas
pipeline group through periods of turmoil place him in a very
small group of highly regarded leaders in the energy industry. As
the Debtors move towards the formation of a Chapter 11 plan, the
Debtors believe that Mr. Horton's continuing participation in the
business is critical.

Mr. Horton is eligible for administrative expense priority for
indemnification claims arising from postpetition services in his
role as a Debtor employee subject to the requirements in the May 8
Order, but not in his role as a Non-Debtor Director and Officer
under the January 24 Order.  Given the possibility of exposure to
liability for postpetition actions, the Debtors contend that they
must be able to provide Mr. Horton, as well as others, confidence
that their indemnification is consistent with the expectations of
directors and officers serving major domestic and international
corporations.

Accordingly, in a Court-approved Stipulation and Order, the
Debtors and Mr. Horton agree:

A. Notwithstanding the Newby litigation reference in the
     January 24 Order, the Debtors are authorized to extend to Mr.
     Horton, as of the Petition Date, the right to indemnification
     provided for under the Articles of Incorporation of the
     Debtors, the Oregon Business Corporation Act and other
     applicable law, for claims and lawsuits based solely on Mr.
     Horton's services performed on or after December 2, 2001
     without further Court order; provided, however, that all other
     provisions of the January 24 Order apply to Mr. Horton,
     including, but not limited to, the requirement that Mr. Horton
     execute a Non-Debtor Director and Officer Indemnification
     Certification amended to remove the reference to the Newby
     Litigation;

B. Any indemnification obligation to Mr. Horton, as
     reimbursement or direct payment, will be funded first, to
     the extent possible, by the non-debtor or any non-debtor
     parent of the entity for whom Mr. Horton serves and for whom
     the actions giving rise for the need for indemnification were
     provided before the indemnification is provided by any of the
     Debtors;

C. To the extent indemnification obligation is funded to or on
     Mr. Horton's behalf by the Debtors, the expense will be
     allocated to those Debtors that are the closest direct
     parent of that non-debtor among the Debtors;

D. All advances or payments made to indemnify Mr. Horton will
     be submitted by the Debtors to the Debtors' insurance
     carriers for reimbursement;

E. The Debtors will provide the Creditors' Committee and the ENA
     Examiner with 10 days' prior written notice of the funding of
     any indemnification obligation to or on behalf of Mr. Horton,
     and the notice will include the non-debtor entity that Mr.
     Horton serves, a description of the transaction or event
     giving rise to the claim, and the status of any insurance
     claim relating to the issue;

F. Mr. Horton's postpetition indemnification claims, if any, are
     entitled to administrative expense priority under Sections
     503(b) and 507 of the Bankruptcy Code; and

G. Nothing in the Stipulation will be deemed to provide
     indemnification to Mr. Horton beyond what is authorized under
     the Debtors' Articles of Incorporation, Oregon law, or other
     applicable law. (Enron Bankruptcy News, Issue No. 71;
     Bankruptcy Creditors' Service, Inc., 609/392-0900)


FISHER SCIENTIFIC: S&P Rates $250M Senior Unsecured Notes at BB-
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned a 'BB-' rating to
Fisher Scientific International Inc.'s $250 million senior
unsecured convertible notes due 2023. The issue is rated one notch
below the corporate credit rating reflecting the relatively large
amount of secured debt carried by Fisher.

The corporate credit rating is affirmed. The outlook is negative.

"The ratings reflect Hampton, New Hampshire-based Fisher
Scientific International Inc.'s substantial debt burden, which
outweighs the benefits of its average business position as a
leading distributor of supplies for life science research and
clinical laboratories," said Standard & Poor's credit analyst
David Lugg. Fisher has used debt-financed acquisitions to increase
the range of self-manufactured products it distributes. The
proposed $727 million purchase of Swedish Perbio AB would increase
the proportion of self-manufactured products to more than 25% from
21% of revenues. However, the acquisition will pressure financial
measures and reverse some of the improvements realized during the
past few years. Lease-adjusted total debt to EBITDA will increase
to 4.5x from 3.4x and funds from operations to total debt will
fall to about 16% from 23%. These measures are expected to
improve, given Fisher's ability to repay borrowing with ample free
cash flow.

The company has a well-established position as a distributor of a
wide variety of supplies and equipment for the scientific and
clinical laboratory communities. The company's broad product
offering, diverse customer base, exclusive distribution
arrangements with equipment manufacturers, and agreements with
most major domestic group-purchasing organizations are barriers to
entry for new competitors. Because Fisher has only a small
presence in the big-ticket capital equipment market, its sales are
not strongly influenced by the capital budget cycles of its
public and private customers. Sales of consumable products
contribute about 80% of the total, providing a stable base of
recurring revenues. In addition, the company's rapidly growing
electronic-commerce business, which now accounts for 26% of sales,
holds the promise of lower selling costs.


FLEMING COMPANIES: Taps DoveBid to Conduct 2nd Webcast Auction
--------------------------------------------------------------
DoveBid(R), Inc., a global provider of capital asset auction and
valuation services, will conduct its second Webcast auction in a
series of sales for Fleming Companies, Inc., a food distributor
and retail grocer, who filed Chapter 11 bankruptcy protection in
April 2003.

The Webcast auction will be broadcast globally live over the
Internet at DoveBid's Website as well as on-location at the
HomeWood Suites by Hilton at 700 Hebron Parkway in Lewisville,
Texas, on July 15, 2003 beginning at 9:00 a.m. Central Daylight
Time. The auction will feature assets from 23 Food4Less and
Rainbow Foods supermarkets and includes transportation assets such
as tractors and trailers, and grocery store assets such as deli,
bakery, produce and meat department equipment, coolers, gondola
racking, point-of-sale systems and more.

Participants may attend in-person or bid online. Detailed preview
information, asset catalog, and online bidding instructions are
available at http://www.dovebid.com For further information,
please contact Renee Jones, CAI at rjones@dovebid.com

DoveBid, Inc. is a global provider of capital asset auction and
valuation services to large corporations and financial
institutions. DoveBid delivers an integrated set of services to
its customers for the disposition, valuation and redeployment of
their surplus capital assets. DoveBid offers an array of auction
services to meet its customers' specific needs, including live
Webcast auctions, on-site-only auctions, featured online auctions
and privately negotiated sales. DoveBid Managed Services offers
clients a hosted, Internet-based application to monitor surplus
assets inside the corporation. DoveBid Valuation Services uses its
database of transaction information to provide valuations of
capital assets for financial institutions and large businesses.

Headquartered in Foster City, California, DoveBid has over 65
years of auction experience in the capital asset industry with
more than 40 locations throughout North America, Europe and the
Asia-Pacific region.


FLEMING COMPANIES: Court Deems Utility Cos. Adequately Assured
--------------------------------------------------------------
Absent any further Court order, U.S. Bankruptcy Court Judge
Walrath rules that utility companies are prohibited from altering
refusing or discontinuing services to, or discriminating against,
Fleming Companies, Inc., and its debtor-affiliates on account of
their bankruptcy filing or their failure to pay prepetition debts
when due.  The utility companies are prohibited from requiring
the Debtors to post deposit as security for any unpaid charges
for the prepetition utility services or as a pre-condition of
postpetition utility services.

Any unpaid postpetition charges for utility services constitute
actual and necessary expenses of preserving the debtors' estates,
entitling the utility companies to administrative expense
priority.

Notwithstanding, a utility company may request additional
assurances of payment in the form of deposit or other security.
Any request must be made in writing and include a summary of the
Debtors' payment history relevant to the affected amounts.
(Fleming Bankruptcy News, Issue No. 7; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


FLEXTRONICS INT'L: Will Publish First Quarter Results on July 24
----------------------------------------------------------------
Flextronics (Nasdaq: FLEX), a global provider of operational
services focused on delivering design, engineering, manufacturing
and logistic solutions to technology companies, will report first
quarter results on Thursday, July 24.

The conference call, hosted by Flextronics' senior management,
will be held at 1:30 p.m. PDT to discuss the financial results of
the Company and its future outlook. This call will be broadcast
via the Internet and may be accessed by logging on to the
Company's Web site at http://www.flextronics.com A replay of the
broadcast will remain available on the Company's Web site after
the call.

Minimum requirements to listen to the broadcast are Microsoft
Windows Media Player software -- free download at
http://www.microsoft.com/windows/windowsmedia/download/default.asp
-- and at least a 28.8 Kbps bandwidth connection to the Internet.

Headquartered in Singapore, Flextronics is the leading Electronics
Manufacturing Services provider focused on delivering operational
services to technology companies. With fiscal year 2003 revenues
of $13.4 billion and approximately 95,000 employees, Flextronics
is a major global operating company with design, engineering,
manufacturing and logistics operations in 29 countries and five
continents. This global presence allows for manufacturing
excellence through a network of facilities situated in key markets
and geographies that in turn provide its customers with the
resources, technology and capacity to optimize their operations.
Flextronics' ability to provide end-to-end operational services
that include innovative product design, test solutions,
manufacturing, IT expertise and logistics has established the
Company as the leading EMS provider. For more information, visit
http://www.flextronics.com

As reported in Troubled Company Reporter's May 6, 2003 edition,
Standard & Poor's Ratings Services assigned its 'BB-' rating to
Flextronics International Ltd.'s new $400 million senior
subordinated notes issue due 2013.

At the same time, Standard & Poor's affirmed its 'BB+' corporate
credit rating and its other ratings on Flextronics. The outlook
remains stable.


GALEY & LORD: Hires Alvarez & Marsal as Restructuring Advisors
--------------------------------------------------------------
Galey & Lord, Inc. (OTC Bulletin Board: GYLDQ) has received
interim approval from the US Bankruptcy Court for the Southern
District of New York to retain New York-based Alvarez & Marsal,
Inc (A&M) and its restructuring professionals. A&M will supplement
existing management with professionals led by Peter A. Briggs, a
managing director at A&M. Mr. Briggs will serve as Chief
Restructuring Officer of Galey & Lord and report to Arthur C.
Wiener, Chairman and CEO.

Mr. Wiener reports that Briggs and A&M have been brought in to
help accelerate the Company's emergence from bankruptcy. "Galey &
Lord is at a critical stage in its bankruptcy proceedings as we
work toward finalizing our business plan, plan of reorganization
and exit strategy," Mr. Wiener stated. The Company has cited
challenging market conditions for US textile manufacturing in
general as a major contributing factor for taking this step at
this time. Galey & Lord, Inc. and its domestic subsidiaries filed
a voluntary petition for reorganization under Chapter 11 of the US
Bankruptcy Code on February 19, 2002.

At A&M, Briggs most recently served as Chief Restructuring Officer
for Consumer Financial Services of retailers Spiegel, Inc. and its
subsidiary Eddie Bauer; Chief Operating Officer for National
Century Financial Enterprises, Inc.; Project Leader for the Arthur
Andersen LLP restructuring advisory assignment; and Chief
Restructuring Advisor to Thomas Havey LLP. Immediately prior to
joining A&M, Mr. Briggs served as a Senior Credit Officer for the
Citibank/Salomon Smith Barney US Leveraged Finance Portfolio.

Previously he spent sixteen years with Citigroup where his roles
included managing its asset-based finance business in New York
focused on LBO, DIP and bankruptcy reorganization financing
working with numerous textile and apparel clients.

Galey & Lord, a leading global manufacturer of textiles for
sportswear, including cotton casuals, denim, and corduroy, and
is a major international manufacturer of workwear fabrics, filed
for chapter 11 protection on February 19, 2002 together with its
affiliates (Bankr. S.D.N.Y. Case No. 02-40445).  The company's
current trading symbol on the OTC BB is GYLDQ.  When the
Company filed for protection from its creditors, it listed
$694,362,000 in total assets and $715,093,000 in total debts.
Joel H. Levitin, Esq., Esq., at Dechert represents the Debtors
and Michael J. Sage, Esq., at Stroock & Stroock & Lavan LLP,
represents the Official Committee of Unsecured Creditors.


GENCORP INC: Fitch Affirms Ratings & Revises Outlook to Stable
--------------------------------------------------------------
Fitch Ratings has affirmed the 'BB' rating on GenCorp Inc.'s bank
credit facilities and the 'B+' rating on its subordinated
convertible notes. The Rating Outlook has been revised to Stable
from Positive for all classes of debt.

The current ratings take into consideration the proposed ARC
Propulsion acquisition. The transaction, which is expected to be
funded from the proceeds of a debt offering, is expected to close
later this summer. Fitch will assign a rating to GY's proposed
debt offering when the terms of the transaction are available.

The affirmation of the ratings reflects GY's improved operating
performance and credit statistics that are representative of the
current rating category. Further support for the ratings comes
from the Company's position in the favorable defense spending
environment, the benefits to be derived from the ARC Propulsion
acquisition, a fully funded pension plan as of Nov. 30, 2002, and
the additional cash flow and cushion that may be derived from
continued development of the company's sizable real estate
holdings. Concerns for the ratings center on GY's low free cash
flow, limited liquidity, potential acquisition integration issues
and environmental liabilities.

The revision of the outlook to Stable primarily reflects a weaker
outlook for the automotive industry, weak cash flow generation and
the impact of approximately $135 million of additional debt
relating to the proposed ARC Propulsion acquisition. Based on
these factors, Fitch believes that the stable outlook
appropriately reflects the trend for GY over the intermediate
term.

With approximately 69% of revenues generated by GDX Automotive
during the first six months of 2003, GY is relatively reliant on
the cyclical automotive sector. Fitch previously indicated concern
about the automotive industry's ability to maintain relatively
high sales volumes, and since then both General Motors and Ford
have decreased their anticipated production levels. For 2003,
Fitch expects North American and European production rates to
exhibit low- to mid-single-digit declines. While GDX's sales were
up slightly and operating margin increased by 120 basis points for
the first six months of 2003, excluding pension income in 2002,
Fitch remains concerned that performance at GDX will continue to
be pressured going forward as original equipment manufacturers
(OEMs) continue to exert pricing pressure on their suppliers.
Because of potentially reduced year-over-year production levels
and the potential for continued pricing pressure from the OEMs,
suppliers like GDX are exposed to both revenue and margin
pressure. Given Fitch's current automotive outlook, GDX's lower
volumes and increased pricing concessions during the first six
months of 2003, Fitch is concerned that GDX may need to take
additional restructuring actions in the near term to address
overcapacity which could possibly be a further drain on GY's
limited cash flow.

Consistent with its goal to grow its aerospace and defense
business, GY announced on May 5 that it had agreed to purchase ARC
Propulsion from Sequa Corporation (SQA) for $133 million in cash.
ARC Propulsion is a division of SQA's Atlantic Research
Corporation and develops and manufactures rocket propulsion
systems, gas generators and auxiliary rocket motors for tactical
weapons and satellite systems. ARC Propulsion serves as a sub-
contractor on high-priority military programs such as the
Tomahawk, PAC-3, Javelin and Standard Missile. In 2002, ARC
Propulsion generated approximately $144 million in revenues,
operating income of $13 million and EBITDA of $20 million.

The ARC Propulsion acquisition provides GY a number of benefits
including complimentary businesses with minimal overlap, increased
scale and a stronger position in both the solid propulsion and
liquid propulsion markets. The acquisition will also allow GY to
participate in a greater number of defense programs, particularly
in the growing areas of missile defense and tactical missiles.
Additionally, GY will benefit from further diversification of its
revenue base, reducing the company's reliance on the more cyclical
automotive sector.

Concerns relating to the acquisition center on the additional debt
incurred to finance the acquisition and integration risks. With
the addition of approximately $135 million of debt and ARC
Propulsion operations, Fitch estimates that GY's pro forma
leverage, as defined by Debt-to-EBITDAP, increased from 3.1x to
3.6x for the 12 months ending May 31. Additionally, pro forma
interest coverage declined to 5x from 6.8x. While these pro forma
credit measures are consistent with the current rating category,
Fitch took the impact from the additional debt into consideration
when determining the stable outlook.

GY currently has limited financial flexibility. As of May 31,
2003, GenCorp had $46 million in cash and $50 - $55 million of
availability under its domestic and foreign credit facilities
offset by $35 million in current maturities. Given that GY has
been operating with negative free cash flow in recent years, Fitch
remains concerned that amortization of bank debt and potential
cash usage for restructuring and consolidation actions could limit
GY's financial flexibility in the intermediate term. An additional
consideration is that GY's pension plans could be a use of cash in
the future, although the plans were slightly over-funded at the
end of the 2002 fiscal year. A potentially offsetting factor to
this liquidity concern is that GY has the ability to sell a
portion of its real estate holdings to help meet its cash flow
needs. However, Fitch recognizes that real estate sales could be
affected by various regulatory issues associated with the
development of the land.


GILAT SATELLITE: Provides Corporate Restructuring Plan Overview
---------------------------------------------------------------
Gilat Satellite Networks Ltd. (Nasdaq: GILTF) has put into
operation a comprehensive restructuring program aimed at
increasing efficiency and substantially cutting down corporate
expenses. The program includes a variety of measures, including
organizational and structural changes and office consolidation
leading to increased efficiency, and a reduction in the worldwide
workforce, significantly reducing the company's labor costs. The
cost cutting and workforce reductions were done segmentally, by
unit, according to specific goals and targets, rather than an
across the board reduction.

The Company believes that the measures included in this program,
together with those already taken in the past, culminating with
the successful conclusion of the company's financial restructuring
plan in April, will lead to reduced costs, improved margins and
profitability and position Gilat for growth in the future.

In addition, the Company announces that Mr. Robert Bednarek, who
was serving as an observer to the Board of Directors, has been
appointed as a Board member. Mr. Bednarek is the Executive Vice
President Corporate Development and a member of the Executive
Committee of SES GLOBAL S.A., the parent company of SES Americom
Inc., which is a principal shareholder of Gilat and a major
supplier of satellite transponder capacity to the Gilat group. Mr.
Bednarek previously was the Executive Vice-President and Chief
Technology Officer of PanAmSat Corporation and holds a B.Sc.
degree in engineering from the University of Florida. The Company
announces the resignation of one of its Board members, Mr. Shally
Tshuva, for personal reasons.

Gilat Satellite Networks Ltd., with its global subsidiaries
Spacenet Inc., Gilat Latin America, Inc. and rStar Corporation, is
a leading provider of telecommunications solutions based on Very
Small Aperture Terminal (VSAT) satellite network technology --
with nearly 400,000 VSATs shipped worldwide. Gilat markets the
Skystar Advantage, DialAw@y IP, FaraWay, Skystar 360E and
SkyBlaster* 360 VSAT products in more than 70 countries around the
world. The Company provides satellite-based, end-to-end enterprise
networking and rural telephony solutions to customers across six
continents, and markets interactive broadband data services. The
Company is a joint venture partner in SATLYNX, a provider of two-
way satellite broadband services in Europe with SES Global and
Alcatel Space and SkyBridge LP, subsidiaries of Alcatel. Skystar
Advantage(R), DialAw@y IP(TM) and FaraWay(TM) are trademarks or
registered trademarks of Gilat Satellite Networks Ltd. or its
subsidiaries. Visit Gilat at http://www.gilat.comfor more
information on the Company. (*SkyBlaster is marketed in the United
States by StarBand Communications Inc. under its own brand name.)


GLOBAL CROSSING: XO Airs Disappointment with Court's Decision
-------------------------------------------------------------
XO Communications, Inc., is disappointed by the U.S. Bankruptcy
Court's ruling Tuesday regarding the decision to approve Amendment
#2 to the Purchase Agreement and to extend the exclusivity period
in the Global Crossing Chapter 11 case. XO remains highly
skeptical that Singapore Technologies Telemedia PTE will be able
to obtain the needed regulatory approvals to consummate this
transaction. Furthermore, XO agrees with the many critics of this
transaction that a Company of this magnitude and importance should
not be owned and controlled by an entity owned by a foreign
government.

"As we stated earlier, we believe that Global Crossing's prolonged
bankruptcy and dwindling cash reserves are expected to result in
continued erosion of its customer base unless an alternative offer
is put in place," said Brian Oliver, EVP Strategy and Corporate
Development at XO. "XO has been through the bankruptcy process and
understands the necessity of having a plan for emergence that
provides customers, vendors and employees with certainty."

According to Global Crossing's May Monthly Operating Report filed
with the Bankruptcy Court, the company's cash burn totaled $48
million in May 2003. Indeed, in the opinion issued by the
Bankruptcy Court today, the Court acknowledged that "(b)ased on
present cash flow projections, that (running out of (unrestricted)
cash) would be likely to happen sometime in October." Given Global
Crossings liquidity position, the payment of $50 million in
bonuses to management and certain employees is now subject to fair
debate. XO will continue to actively monitor both the bankruptcy
and regulatory proceedings.

XO Communications is a leading broadband communications service
provider offering a complete set of communications services,
including: local and long distance voice, Internet access, Virtual
Private Networking, Ethernet, Wavelength, Web Hosting and
Integrated voice and data services.

XO has assembled an unrivaled set of facilities-based broadband
networks and Tier One Internet peering relationships in the United
States. XO currently offers facilities-based broadband
communications services in more than 60 markets throughout the
United States.


GLOBAL LEARNING: Wants Nod to Hire Marcus Santoro as Attorneys
--------------------------------------------------------------
Global Learning Systems, Inc., and its debtor-affiliates seek
approval from the U.S. Bankruptcy Court for the District of
Maryland to engage Marcus, Santoro & Kozak, PC as attorneys.

The Debtors report that to perform the duties of a debtor in
possession, they require the assistance of counsel.  The Debtors
require the full range of traditional business legal services, as
well as, legal services unique to a bankruptcy reorganization
proceeding.

In its capacity, Marcus Santoro will:

      a. prepare the petition, lists, schedules and statements
         required by Section 521; the pleadings, motions,
         notices, and orders required for the orderly
         administration of the estate, the progress of this case;
         and, to consult with and advise the Debtors in the
         operation of the businesses of the Debtors;

      b. advise and consult concerning the administration of the
         estate in this case, concerning rights and remedies with
         regard to the Debtors' assets; concerning the claims of
         administrative, secured, priority, and general unsecured
         creditors and other parties in interest;

      c. appear for, prosecute, defend, and represent the
         Debtors' interests in all contested matters, adversary
         proceedings, and other motions and applications arising
         under, arising in, or related to this case;

      d. investigate the existence of other assets of the estate;
         and, if any exist, to take appropriate action to have
         the same turned over to the estate;

      e. prepare a Disclosure Statement and Plan of
         Reorganization for the Debtors, and negotiate with all
         creditors and parties in interest who may be affected
         thereby; to obtain confirmation of a Plan of
         Reorganization; and perform all acts reasonably
         calculated to permit the Debtors to perform such acts
         and consummate a Plan of Reorganization; and

      f. perform all of the legal services for the Debtors that
         may be necessary or desirable.

Frank J. Santoro tells the Debtors that he and Karen Crowley will
be the one principally responsible in this retention.
Mr. Santoro's hourly rate is $260 per hour and Ms. Crowley's
hourly rate is $205 per hour.  Marcus Santoro's current
professional hourly rates are:

           Attorneys           $140 to $260 per hour
           Paralegals          $35 to $90 per hour

Global Learning Systems, Inc., an improvement solutions company
headquartered in Frederick, Maryland, filed for chapter 11
protection June 6, 2003 (Bankr. Md. Case No. 03-30218).  Brent C.
Strickland, Esq., at Whiteford, Taylor & Preston LLP, represents
the Debtors in their restructuring efforts. When the Company filed
for protection from its creditors, it listed assets of over a
million and debts of more than $10 million.


GRUPO IUSACELL: 14.25% Bonds' Grace Period Passes in Silence
------------------------------------------------------------
Grupo Iusacell, S.A. de C.V. (BMV:CEL) (NYSE:CEL) previously
publicly announced that pending agreement with its lenders on a
restructuring plan, it would not make the US$25 million interest
payment due on June 1, on its 14.25% bonds due 2006. The 30-day
period within which to make the interest payment has expired.

As a result, an event of default has occurred under the Indenture
governing the bonds, and the bondholders have the right to declare
the principal of and the accrued interest under the bonds due and
payable or take other legal actions specified in the Indenture, as
they deem appropriate.

Grupo Iusacell, S.A. de C.V. (Iusacell, NYSE: CEL; BMV: CEL) is a
wireless cellular and PCS service provider in seven of Mexico's
nine regions, including Mexico City, Guadalajara, Monterrey,
Tijuana, Acapulco, Puebla, Leon and Merida. The Company's service
regions encompass a total of approximately 92 million POPs,
representing approximately 90% of the country's total population.


GSR MORTGAGE: Fitch Rates Class B4 and B5 P-T Certs. at BB/B
------------------------------------------------------------
Fitch rates GSR Mortgage Loan Trust, series 2003-6F $623.8 million
residential mortgage pass-through certificates, classes A-1
through A-9, A-P, and A-X certificates (senior certificates)
'AAA'. In addition, Fitch rates class B1 ($8 million) 'AA', class
B2 ($3.8 million) 'A', class B3 ($1.9 million) 'BBB', class B4
($1.3 million) 'BB' and class B5 ($1 million) 'B'.

The 'AAA' rating on the senior certificates reflects the 2.65%
subordination provided by the 1.25% class B1, 0.60% class B2,
0.30% class B3 and 0.50% privately offered classes B4, B5 and B6
certificates. Classes B1, B2, B3, B4, and B5 are rated 'AA', 'A',
'BBB', 'BB' and 'B', respectively, based on their respective
subordination. The class B6 is not rated by Fitch. The ratings
also reflect the quality of the underlying collateral, the
capabilities of Well Fargo Home Mortgage, Inc. (rated 'RPS1' by
Fitch) as servicer, and Fitch's confidence in the integrity of the
legal and financial structure of the transaction.

As of the cut-off date, June 1, 2003, the mortgage pool consists
of 20- to 30-year fixed-rate mortgage loans with an approximate
balance of $640,824,297. All of the loans were originated by Well
Fargo Home Mortgage, Inc. (100%). The mortgage pool has an average
unpaid principal balance of $443,170 and a weighted average credit
score of 734. The pool has approximately 64.3% and 7.2%, with
credit scores above or equal to 720 and below 660, respectively.
The weighted average loan to value ratio (LTV) at origination was
66.23%. The mortgage pool has an average seasoning of 12 months
and the current LTV is 65.37%. The three states with the highest
loan concentrations are: California (42.9%), New York (6.5%) and
Virginia (6.3%).

None of the mortgage loans are 'high cost' loans as defined under
any local, state or federal laws. Goldman Sachs Mortgage Company
purchased the loans from Bank of America Mortgage Capital
Corporation and deposited the loans in the trust, which issued the
certificates, representing undivided and beneficial ownership in
the trust. For federal income tax purposes, the trustee will cause
one real estate mortgage conduit investment election to be made
for the trust. JPMorgan Chase Bank will serve as trustee.


JC PENNEY: Fitch Affirms BB+ Rating on $1.5-Bill. Bank Facility
---------------------------------------------------------------
Fitch Ratings has affirmed the 'BB+' rating on J. C. Penney Co.,
Inc.'s $1.5 billion secured bank facility, the 'BB' rating on
Penney's senior unsecured notes, and the 'B+' rating on the
company's convertible subordinated notes. In addition, the 'B'
commercial paper rating of J.C. Penney Funding Corp., is
withdrawn. The Rating Outlook has been revised to Negative from
Stable. Approximately $5.8 billion of debt is affected by the
rating actions.

The affirmations reflect the progress Penney has made over the
past two years in turning around its department store and Eckerd
drugstore businesses as well as the company's strong liquidity
position, offset by continued high financial leverage. Despite the
progress made to-date, the Negative Outlook reflects current
operating weakness in both business segments, as comparable store
sales declined 3.2% at the department stores and 1.1% at Eckerd in
the first four months of 2003. Sales weakness, which is expected
to persist over the balance of 2003, is slowing the pace of margin
improvement.

The department stores are faced with a soft apparel environment,
and are now lapping two years of positive sales, making the
comparisons more difficult. This segment is now halfway through a
5-year turnaround plan, with further progress expected in
improving the appeal of its merchandise offerings, reducing costs
and smoothing the flow of goods to its stores. Eckerd's comparable
store sales continue to lag its competitors despite a major effort
to reconfigure and remodel its stores. Penney management plans to
review its strategic options for Eckerd at the end of the year,
with the possibility that it will sell or spin-off this business
at some point.

Penney's liquidity is strong, with $2.6 billion of cash at April
26, 2003. Penney has sufficient cash in place to cover peak
seasonal working capital needs of $1.2 billion, debt maturities in
2003 and 2004 of $630 million, and projected negative free cash
flow of $500 million over the 2003-2005 period. Negative free cash
flow arises from higher capital expenditures to fund faster growth
at Eckerd and ongoing investments at the department stores.

Though Penney's credit measures have improved over the past two
years, they remain weak for the rating category. EBITDAR (before
restructuring and other charges) coverage of interest plus rents
increased to 2.0 times in the twelve months ended April 26, 2003
from 1.7x in 2001 and leverage, as measured by lease-adjusted debt
to EBITDAR, improved to 5.1x from 5.9x over the same time period.
Fitch expects these measures will gradually strengthen over the
medium term as profitability and cash flow improve.


KEMPER INSURANCE: S&P Junks & Withdraws Counterparty Rating
-----------------------------------------------------------
Standard & Poor's Ratings Services lowered its counterparty credit
and financial strength ratings on the members of the Kemper
Insurance Cos., intercompany pool to 'CCC' from 'B-' with a
negative outlook.

All the ratings have been removed from CreditWatch, where they
were placed on Feb. 18, 2003. The ratings have now been withdrawn
at the company's request.

"The downgrade on Kemper reflects deterioration in the surplus
position since year-end 2002," observed credit analyst John Iten.

At the same time, Standard & Poor's lowered its rating on
Lumbermens Mutual Casualty Co.'s $400 million 9.15% surplus notes
due 2026 to 'D' from 'C', following the company's anticipated
nonpayment of interest.

Kemper disclosed on June 30, 2003 that its surplus decreased to
$313 million by the end of May from $697 million at year-end 2002.

The decline in surplus was largely driven by a number of asset-
valuation adjustments made by Kemper's outside auditor, KPMG LLP,
to reflect the company's runoff status. Standard & Poor's
anticipates a more gradual decline in surplus, however, as many of
the steps needed to convert the balance sheet from a going concern
to a runoff basis have now been completed.


LARRY'S STANDARD BRAND: Tapping Witherspoon as PR Consultants
-------------------------------------------------------------
Larry's Standard Brand Shoes, Inc., asks for permission from the
U.S. Bankruptcy Court for the Northern District of Texas to employ
Witherspoon as its Public Relations and Advertising Consultant
utilized in the ordinary course of business.

The Debtor reports that it needs the services of Witherspoon to
assist it in dealing with public relations issues arising from the
bankruptcy filing and advertising.

The services that Witherspoon will render to the Debtor include:

      a) dealing with public relations issues, including those
         arising from the bankruptcy filing;

      b) developing and implementing advertising strategies for
         the Debtor; and

      c) providing all other service to the Debtor in connection
         with its publicity, public relations and advertising as
         may be necessary or appropriate or otherwise requested
         by the Debtor.

Witherspoon has agreed to perform the public relations and
advertising services for a monthly fee of $10,500.

Larry's Standard Brand Shoes, Inc., is in the business of retail
sales of men's shoes and accessories.  The Company filed for
chapter 11 protection on June 3, 2003 (Bankr. N.D. Tex. Case No.
03-45283).  J. Robert Forshey, Esq., at Forshey and Prostok, LLP,
represents the Debtor in its restructuring efforts.  When the
Company filed for protection from its creditors, it listed
$8,836,861 in total assets and $10,782,378 in total debts.


LEAP WIRELESS: Court OKs Rogozienski as Spec. Litigation Counsel
----------------------------------------------------------------
Leap Wireless International Inc., and its debtor-affiliates sought
and obtained the Court's authority to employ Frank E. Rogozienski,
Inc. as their special litigation counsel.

According to Robert A. Klyman, Esq., at Latham & Watkins LLP, in
Los Angeles, California, Rogozienski has extensive expertise in
complex business litigation, particularly involving wireless
telecommunications matters.  Rogozienski has consulted with and
represented Leap since 1999 in litigation and pre-litigation
matters.  Rogozienski represented Leap in litigation involving a
business venture in Russia, and in prior Endesa disputes.
Rogozienski also represented Leap in a lengthy arbitration
concerning adjustments to the purchase price of several licenses.
Rogozienski represented members of Leap management in litigation
brought against them and Leap in connection with acts they
performed on Leap's behalf.  Since 2001, Rogozienski has
represented Leap as its litigation counsel in Leap Wireless
International, Inc. v. Collier Shannon Scott PLLC and Leap
Wireless International, Inc. v. Endesa.

Mr. Klyman relates that Leap filed a complaint in the Collier
Shannon Matter against Collier Shannon Scott PLLC on October 1,
2002.  The dispute relates to certain intellectual property legal
services provided to Leap by Collier Shannon.  Recently the
Collier Shannon Matter was removed from the San Diego Superior
Court to the United States District Court for the Southern
District of California.  The District Court has set an Early
Neutral Evaluation Conference for May 22, 2003.  On February 3,
2003, Collier Shannon filed its Answer to the Complaint and
Demand for Jury Trial.

Mr. Klyman informs the Court that proceedings in the Endesa
matter relate to the sale of Smartcom, S.A., a Chilean corporation
that operates a nationwide wireless network in Chile, to Endesa
S.A. on June 2, 2000.  As part of the sale, Leap received a
$35,000,000 promissory note receivable from Endesa subject to a
right of set-off to secure indemnification claims under the
purchase agreement.  Endesa asserted $48,700,000 in claims against
Leap for breach of representations and warranties under the
purchase agreement and notified Leap that it was offsetting the
claims against the entire unpaid balance of the note.  The Endesa
matter is currently pending in the 19th Civil Court of Santiago in
the Republic of Chile.

Frank E. Rogozienski is the sole practitioner for the law offices
of Frank E. Rogozienski, Inc.  Mr. Rogozienski is a member in
good standing of the bar of the State of California, and is an
attorney duly admitted to practice law in all of the Courts of
the State of California, this Court and the United States District
Courts for the Southern, Central, Eastern and the Northern
Districts of California.

Frank E. Rogozienski assures the Court that the Firm has no
connection with the Debtors, any of the Debtors' subsidiaries or
affiliates, any creditors of the Debtors, the United States
Trustee for this District, or any other party-in-interest in the
Debtors' Chapter 11 proceeding, or its attorneys and accountants.
In addition, Mr. Rogozienski does not hold or represent any
interest adverse to the Debtors with respect to the matters of
which Rogozienski will advise the Debtors, except that:

       (i) Mr. Rogozienski, in connection with its current and past
           representation of the Debtors in the Litigation Matters
           and other matters is owed less than $5,000 for
           prepetition services;

      (ii) Mr. Rogozienski owns less than 36,000 shares of Leap and
           holds less than 5,000 stock options; and

     (iii) in matters unrelated to Leap and these Chapter 11
           proceedings, Mr. Rogozienski represents Mr. Harvey White
           and Mr. White's adult daughter as individuals.

Mr. Rogozienski discloses that the Firm received a $50,000
prepetition retainer for the Collier Shannon Matter.  As of the
Petition Date, Rogozienski has not billed or collected from the
prepetition retainer.  The Collier Shannon Fee Agreement provides
that Rogozienski will be paid on a contingency fee basis amounting
to:

     -- 20% of all sums and other consideration, paid collected or
        recovered under a Binding Settlement Agreement entered into
        within 90 days of filing the complaint;

     -- 25% of all sums and other consideration, paid collected or
        recovered under a Binding Settlement Agreement entered into
        within 90 days to 180 days of filing the complaint; or

     -- 33-1/3% of all sums and other consideration, paid collected
        or recovered after 180 days.

The Endesa Fee Agreement provides that Rogozienski will be paid
$350 per hour for Mr. Rogozienski's time, and at $75 to $150 per
hour for paralegal's time, plus reimbursement of actual and
necessary expenses incurred. (Leap Wireless Bankruptcy News, Issue
No. 6; Bankruptcy Creditors' Service, Inc., 609/392-0900)


LEVEL 3: S&P Assigns Junk Rating to Proposed Sr. Note Drawdown
--------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'CC' rating to
Level 3 Communications Inc.'s proposed shelf drawdown of $250
million convertible senior notes due 2010. Proceeds will be used
for general corporate purposes, including working capital, capital
expenditures, product development, debt repurchases, and
acquisitions. All ratings on the company are affirmed. The outlook
is negative.

Although cash proceeds improve Level 3's liquidity, Standard &
Poor's is still concerned about the company's ability to withstand
prolonged industry weakness, and risk from its acquisition
strategy.

"The ratings on Level 3 continue to reflect high financial risk
from heavy debt levels, and negative discretionary cash flow, as
well as depressed data transport industry conditions characterized
by weak demand, overcapacity, and heavy competition," said
Standard & Poor's credit analyst Eric Geil. The ratings further
reflect risk from Level 3's aggressive consolidation strategy,
which could strain liquidity and exacerbate the company's already
weak financial condition. Offsetting factors include customer
contracts and the asset value of the company's fiber optic
network.

Level 3 is a facilities-based provider of long haul data transport
services. The company serves many key cities with its 16,000 mile
intercity fiber optic network in North America and a 3,600 mile
network in Europe. Level 3 also provides software distribution
services.

Because of the downturn in the telecommunications sector, Level 3
has taken active measures to stabilize its operations. Actions
include focusing on financially solid customers, reducing
overhead, cutting capital expenditures, and selling assets. The
company has also reduced debt through discounted debt repurchases
and asset sales.

Level 3's purchase of bankrupt telecommunications carrier Genuity
Inc. in February 2003 expanded the company's revenue base and
included substantial contracts with America Online and Verizon
Communications. The acquisition also modestly expanded Level 3's
network. To integrate the acquisition, Level 3 is eliminating
redundant facilities and is migrating Genuity's customers onto
Level 3's network. The company is also exiting Genuity's managed
hosting business. Although the process is consuming capital, it
could improve profitability in the longer term.

Level 3's software distribution business is experiencing demand
softness as corporate customers delay software purchases. This
business generates negligible EBITDA at about a 1% margin. Level 3
entered the software distribution business in 2002 with the
purchase of two companies, in part to help it meet minimum revenue
covenants under its bank credit facility.


LNR CDO: S&P Assigns Low-B Ratings to Class H and J Notes
---------------------------------------------------------
Standard & Poor's Ratings Services assigned its preliminary
ratings to LNR CDO 2003-1 Ltd./LNR CDO 2003-1 Corp.'s $493.513
million floating- and fixed-rate notes.

The preliminary ratings are based on information as of
July 1, 2003. Subsequent information may result in the assignment
of final ratings that differ from the preliminary ratings.

      The preliminary ratings reflect:

      -- The expected commensurate level of credit support in the
         form of subordination to be provided by the notes junior
         to the respective classes and by the preference shares;

      -- Excess spread and overcollateralization provided by the
         assets;

      -- The cash flow structure, which is subject to various
         stresses requested by Standard & Poor's;

      -- The experience of the collateral administrator;

      -- The coverage of interest rate risks through hedge
         agreements; and

      -- The legal structure of the transaction, which includes the
         bankruptcy remoteness of the issuer.

                     PRELIMINARY RATINGS ASSIGNED

         LNR CDO 2003-1 Ltd./LNR CDO 2003-1 Corp.
         Class          Rating    Amount ($)
         A              AAA       99,160,000
         B              AA        78,184,000
         C-FX           A          9,860,000
         C-FL           A         34,000,000
         D-FX           A-        40,766,000
         D-FL           A-         5,000,000
         E-FX           BBB       41,626,000
         E-FL           BBB       48,000,000
         F-FX           BBB       44,724,000
         F-FL           BBB        6,000,000
         G              BBB-      12,204,000
         H              BB        30,511,000
         J              B         43,478,000
         Pref shares    N.R.     269,153,244

             N.R. -- Not rated.


LNR PROPERTY: Fitch Assigns BB- Rating to $350MM Sr. Sub. Notes
---------------------------------------------------------------
Fitch Ratings has assigned a 'BB-' rating to LNR Property Corp's
$350 million ten year 7.625% senior subordinated notes. The notes
have a final maturity of July 15, 2013 and are pari passu with
LNR's existing senior subordinated debt. The Rating Outlook is
Stable. Partial proceeds from the transaction will be used to
fully refinance LNR's $200 million of 9.375% senior subordinated
notes due in 2008.

Fitch views the issuance constructively as it increases LNR's
unsecured capital base and will allow the company to unencumber
assets. In addition, this issuance will lengthen LNR's weighted
average debt maturity to approximately 5 years. There may also be
a modest positive impact on the cost of funding, as new funds will
have a yield improvement of 175 basis points over the securities
being refinanced. However, it is anticipated that LNR will also
repay $150 million of lower cost secured funds. Fitch views this
trade-off favorably as the quality of LNR's unencumbered asset
pool is a concern. While unsecured capital divided by total
capital will improve to approximately 65.1% from 62.4% at Feb. 28,
2003 as a result of the new issuance, it is not yet certain how
the unencumbered asset quality will be affected.

The rating reflects LNR's good asset performance and consistent
profitability. Fitch believes that the fundamental driver of LNR's
success has been its risk management, due diligence and commercial
mortgage-backed securities special servicing operations. LNR has
also made improvements in its funding, liquidity and
capitalization, which includes the recent issuance. The rating
also takes into account the risks inherent in LNR's significant
unrated CMBS, repositioning property, partnership equity, and land
investments.

Based in Miami, Florida with roots dating to 1969, LNR
underwrites, purchases, and manages real estate and real estate
driven investments. LNR has also developed one of the top CMBS
special servicer franchises in the U.S., with a market share of
21% at Feb. 28, 2003. LNR primarily seeks investment opportunities
where it can purchase assets at a discount and utilize its due
diligence, repositioning, asset management, and workout expertise
to improve cash flows and profitability. Specifically, activities
include the development or purchase of office buildings, apartment
buildings, affordable housing communities, retail space,
investments in subordinated CMBS, and mortgage and real estate-
backed loans.


LODGENET ENTERTAINMENT: Tender Offer for 10.25% Sr Notes Expires
----------------------------------------------------------------
LodgeNet Entertainment Corporation's (Nasdaq: LNET) tender offer
relating to its 10.25% Senior Notes due 2006 expired at 12:00
midnight, EDT, on Monday, June 30, 2003.

There were no additional tenders of Notes following the consent
solicitation that expired at 5:00 p.m., EDT time, on Wednesday,
June 11, 2003. Holders of approximately 79% of the outstanding
principal amount of the Notes tendered their Notes and delivered
their consents to the proposed amendments to the Indenture
governing the Notes prior to the consent deadline.

The Company entered into on June 12, 2003, a supplemental
indenture relating to the Notes incorporating the proposed
amendments, as described in the Offer to Purchase and Consent
Solicitation Statement dated June 3, 2003. The proposed amendments
became effective, and the holders of Notes became bound thereby
when the Company accepted the Notes for payment pursuant to the
terms of the tender offer and consent solicitation on June 18,
2003.

As previously announced, the Company is redeeming the $32,030,000
aggregate principal amount of the Notes remaining outstanding at a
price of 102.563% of the aggregate principal amount, plus accrued
and unpaid interest through (but not including) July 1, 2003.

LodgeNet Entertainment Corporation -- http://www.lodgenet.com--
is the leading provider in the delivery of broadband, interactive
services to the lodging industry, serving more hotels and guest
rooms than any other provider in the world. These services include
on-demand digital movies, digital music and music videos,
Nintendo(R) video games, high-speed Internet access and other
interactive television services designed to serve the needs of the
lodging industry and the traveling public.  As the largest company
in the industry, LodgeNet provides service to 960,000 rooms
(including more than 900,000 interactive guest pay rooms) in more
than 5,700 hotel properties worldwide. More than 260 million
travelers have access to LodgeNet systems on an annual basis.
LodgeNet is listed on Nasdaq and trades under the symbol LNET.

As reported in Troubled Company Reporter's June 5, 2003 edition,
Standard & Poor's Ratings Services assigned its 'B-' rating to
LodgeNet Entertainment Corp.'s new $185 million senior
subordinated notes due 2013. The notes are issued under LodgeNet's
$225 million shelf registration filed May 2002. All existing
ratings, including the 'B+' long-term corporate credit rating, are
affirmed. The outlook remains stable.


LONGVIEW ALUMINUM: Appoints Patrick James as Chief Exec. Officer
----------------------------------------------------------------
Longview Aluminum Chairman Michael Lynch has appointed Patrick
James as CEO overseeing day-to-day operations at the high-purity
aluminum smelter located in Longview, Washington. James' hiring is
indicative of company officials' expectation that the bankruptcy
court will approve the reorganization plan originally requested by
the court for submission on July 2.

Lynch has requested an extension of this deadline as he finalizes
details of a plan that would allow the company to self-source the
energy necessary to operate the plant.

"We are currently working out the details of an innovative natural
gas- for-electricity swap that would allow Longview Aluminum
access to power at a rate that would allow for our plant to
operate profitably well into the future," said Lynch. "Pat James
is well-suited to join our entrepreneurial, forward-thinking
executive team as we work toward reopening the smelter." With
timely court approval of the reorganization plans, Lynch estimates
that Longview Aluminum could be operational again as soon as
November of this year.

In announcing James' hiring, Lynch stressed his ongoing interest
in exploring further acquisitions in the aluminum industry, as
well as in other metals. "Pat brings strong leadership skills and
a deep background of experience in the aluminum industry, but also
in other metals such as copper, silver, gold and uranium. His day-
to-day leadership at Longview Aluminum and expertise will be
invaluable and allow us to move quickly as we evaluate future
opportunities to expand our metals holdings," continued Lynch.

James most recently served as an associate and consultant with
Thames Capital Corporation Ltd., a consulting firm specializing in
financial structuring, raising of funds in international capital
markets and management and corporate governance.

Previously, he had served as president and CEO of Rio Algom
Limited of Toronto, Ontario, Canada, an international copper
mining and metals distribution company with operations in South
America, Canada and the U.S. James' accomplishments at Rio Algom
include the Antamina $2.3 billion copper-zinc joint venture in
South America, the company's listing on the New York Stock
Exchange and its subsequent acquisition by Billiton PLC as a
shareholder defense against a creeping takeover.

A graduate of the Colorado School of Mines, James was recognized
as the institution's Distinguished Achievement Medalist in 1995.
He has also been honored with the Society for Mining and
Metallurgy's Daniel C. Jackling Award in 1999 and the Canadian
Institute of Mining, Metallurgy and Petroleum's Distinguished
Lecturers Award in 2000. He is widely published on the topic of
environmental sustainability in the mining and minerals industry
and serves as a director of Stillwater Mining Company, Dynatec
Mining Corporation and the Mineral Mining Hall of Fame.

Longview Aluminum is a high-purity aluminum smelting facility in
Longview, Washington.


MCMS INC: Secures Plan Exclusivity Extension through July 12
------------------------------------------------------------
By order of the U.S. Bankruptcy Court for the District of
Delaware, MCMS, Inc., and its debtor-affiliates obtained an
extension of their exclusive periods.  The Court gives the
Debtors, until July 12, 2003, the exclusive right to file
their plan of reorganization and the exclusive right, until
September 12, 2003, to solicit acceptances of that Plan.

Following the sale of its business and associated trade names and
trade marks, MCMS, Inc., changed its name to Custom Manufacturing
Services, Inc.  Debtor MCMS Customer Services, Inc., has also
changed its name to CMS Customer Services, Inc. The Debtors filed
for Chapter 11 protection on September 18, 2001 and converted
these cases under Chapter 7 Liquidation of the Bankruptcy Code on
May 13, 2002.  Eric D. Schwartz, Esq., and Donna L. Harris, Esq.,
at Morris, Nichols, Arsht & Tunnell, represent the Debtors as they
wind-up their assets.  When the company filed for protection from
its creditors, it listed $173,406,000 in assets and $343,511,000
in debt.


MED DIVERSIFIED: Fourth Quarter Net Loss Stands at $39 Million
--------------------------------------------------------------
Med Diversified, Inc., (PINK SHEETS: MDDVQ), a leading provider of
home and alternate site health care services, announced its fourth
quarter and fiscal year financial results for the period ended
March 31, 2003, as reported in its annual report on Form 10-K
filed Tuesday.

Net loss for the fourth quarter of FY03 was $38.9 million or $0.26
per share, including $40.8 million in impairment charges.
Excluding the effect of impairment charges, pro forma net income
for the fourth quarter would have been $1.9 million. In
comparison, excluding impairment charges, pro forma net loss for
the fourth quarter of the fiscal year ended March 31, 2002 would
have been $50.1 million, and pro forma net loss for the third
quarter of FY03 would have been $4.7 million.

Net sales for the fourth quarter of FY03 was $85.7 million, a
decrease of 14 percent compared to $99.5 million for the fourth
quarter of FY02 and a decrease of 5 percent compared to $89.8
million in the third quarter of FY03. The decrease occurred as the
Company closed unprofitable locations while preparing to
reorganize under the provisions of the Bankruptcy Code.

The Company's adjusted EBITDA for the fourth quarter of FY03,
including equity of the Company's joint ventures, was a deficit of
$32.2 million. Excluding impairment charges, the adjusted EBITDA
would have been $8.6 million. In comparison, excluding impairment
charges, the adjusted EBITDA would have been a deficit of $39.1
million for the fourth quarter of FY02 and $2.2 million for the
third quarter of FY03. (EBITDA is a non-GAAP financial measurement
calculated as earnings before interest, taxes, depreciation and
amortization.)

Net loss for FY03 was $71.3 million or $0.48 per share, compared
to $326.8 million or $3.26 per share in FY02. Excluding impairment
charges, net loss for FY03 was $30.1 million, compared to $151.7
million in FY02.

Net sales for FY03 was $369.5 million, a 78 percent increase over
$207.4 million in FY02. The sharp increase primarily is due to a
full year's inclusion of net sales from the acquired companies
Tender Loving Care Health Care Services, Inc., and Chartwell
Diversified Services, Inc.

The Company's adjusted EBITDA for FY03, including equity of the
Company's joint ventures and excluding impairment charges, was
$5.7 million, compared to a deficit of $107.0 million for FY02.

"In the fourth quarter of FY03, the Company delivered its most
successful financial performance since its inception in January
1999," said Frank P. Magliochetti, Jr., chairman and chief
executive officer. "Strict expense controls throughout the year
primarily drove this fourth quarter performance, including
significant cuts to administrative expenses at TLCS and at the
headquarters of Med. Additionally, we assessed the performance of
each of our branches and closed those deemed under-performing,
which contributed to this quarter's improvement in operating
performance despite the decline in net sales.

"We are proud of this performance, which we delivered despite the
adversity our company faced this past fiscal year," Magliochetti
continued. "I would like to commend all our care givers,
administrative staff and managers for their hard work and
determination."

                      Reorganization Update

As previously announced, the Company and five of its wholly owned
subsidiaries filed for Chapter 11 bankruptcy protection on
November 27, 2002, with the U.S. Bankruptcy Court, Eastern
District of New York. Additionally, TLCS filed separately for
Chapter 11 protection on November 8, 2002. The Company's joint
ventures with third parties were not part of the bankruptcy
filing. The Chapter 11 filings were prompted by the abrupt halt in
funding from the companies' former senior lender, National Century
Financial Enterprises.

The Company is developing a Plan of Reorganization, which must be
approved by the requisite creditors and confirmed by the Court
before taking effect. Under the U.S. Bankruptcy Code, unless
creditors agree otherwise, pre- and post-petition liabilities must
be satisfied in full before shareholders are entitled to receive
any distribution or retain any property under the Plan. Recovery
to the creditors and/or common shareholders, if any, will be
unknown until the Plan is confirmed. The Plan could result in
holders of the Company's common stock receiving no distribution on
account of their interests and cancellation of their existing
stock; therefore, the value of the common stock is highly
speculative. A further explanation can be found in the Company's
Form 10-K.

Med Diversified operates companies in various segments within the
health care industry, including pharmacy, home infusion,
management, clinical respiratory services, home medical equipment,
home health services and other functions. For more information,
see http://www.meddiversified.com


MEDMIRA INC: April 30 Net Capital Deficiency Stands at $10 Mill.
----------------------------------------------------------------
MedMira Inc. (TSX Venture: MIR) reported its financial results for
its third quarter which ended April 30, 2003. Product sales in the
quarter were $38 thousand up from $17 thousand in the same quarter
last year. The Company did not have any license fee revenue in the
quarter ended April 30, 2003 compared with $26 thousand in the
same period last year. Total expenses for the three months ended
April 30,2003 were $1.7 million compared to $1.1 million for the
same three month period last year. This increase in expenses in
the quarter relates to an inventory adjustment for expired product
and higher costs associated with the achievement of regulatory
approval in the United States and China. The net loss for the
quarter was $1.7 million compared with $1.1 million in the same
period last year.

For the nine months ended April 30,2003 product sales increased to
$127 thousand from $48 thousand in the previous year. For the nine
months ended April 30, 2003 the Company did not have any license
fee revenue. This compares with $206 thousand for the nine months
ended April 30, 2002. Total expenses for the nine months ended
April 30, 2003 increased to $4.0 million up from $3.5 million for
the same period last year. The net loss for the nine months ended
April 30,2003 was $3.9 million as compared to $3.2 million for the
same period in the previous year.

At April 30, 2003 the Company had total assets of $1.5 million of
which $72 thousand was cash and cash equivalents, compared with
$3.4 million of total assets and $1.0 million in cash and cash
equivalents at April 30, 2002.

Thus, as at the same date, the Company's balance sheet shows a
total shareholders' equity deficit of about $10 million.

Mr. Stephen Sham Chairman and CEO of MedMira Inc. said "The third
quarter marks a turning point for our company. In April 2003 we
received two significant regulatory approvals from the FDA in the
United States and the SFDA in China. These approvals validate our
technology platform and our rapid HIV tests. They also signal the
MedMira is moving into a new phase of its evolution. That is the
operational phase where we begin to manufacture and sell our
products into the major markets of the world. We began shipping
the Reveal(TM) Rapid HIV Test to our US distributor in May and to
date we have shipped some 100,000 kits. In July we expect to
further expand production and shipments as we start shipping the
MiraWell(TM) Rapid HIV Test to China."

MedMira -- http://www.medmira.com-- is a commercial biotechnology
company that develops, manufactures and markets qualitative, in
vitro diagnostic tests for the detection of antibodies to certain
diseases, such as HIV, in human serum, plasma or whole blood.
MedMira's Reveal(TM) and MiraWell(TM) Rapid HIV Tests have
recently been approved by the United States FDA and SDA in the
People's Republic of China, respectively. All of MedMira's
diagnostic tests are based on the same flow-through technology
platform thus facilitating the development of future products.
MedMira's technology provides a quick (under 3 minutes), accurate,
portable, safe and cost-effective alternative to conventional
laboratory testing.


METROCALL INC: Pays Off L-T Debt and Redeems Balance of Notes
-------------------------------------------------------------
On June 30, 2003, Metrocall Holdings, Inc. (OTCBB: MTOH), the
second largest narrowband wireless paging carrier in the United
States, voluntarily retired in-full the remaining $11.5 million
outstanding aggregate principal amount of its 12% senior
subordinated PIK Notes.

This payment marked the final and early retirement of all debt
balances issued in connection with the Company's reorganization in
October 2002. Metrocall has retired in-full over $80 million
aggregate principal amount of debt securities since the beginning
of 2003.

"The early retirement of Metrocall's outstanding debt balances
represents a significant milestone for our organization and
stakeholders," said Metrocall President and CEO, Vincent D. Kelly.
"This accomplishment was made possible by the hard work and focus
of Metrocall's employees as well as the strong support we have
received from our pre-reorganization constituents who stuck by us
and believed we could make it happen," he said.

After this final repayment of the aggregate outstanding debt
balances, Metrocall's unrestricted cash balances were
approximately $11 million. Metrocall has approximately six million
shares of outstanding preferred stock, with an aggregate
liquidation preference of approximately $66.8 million, and one
million shares of common stock. Please refer to the Company's most
recent report on Form 10-Q, annual report on Form 10-K and proxy
statement for details on these securities.

Metrocall, Inc., headquartered in Alexandria, Virginia, is the
nation's second largest narrowband wireless messaging provider
offering paging products and other wireless services to business
and individual subscribers. With national networks and operations,
the Company provides reliable and cost effective wireless services
that are well suited for solving the mobile business communication
needs. Metrocall focuses on the business-to-business marketplace
and supports organizations of all sizes, with a special emphasis
on the medical and government sectors. In addition to traditional
numeric and one-way text paging, the Company also offers two-way
interactive advanced messaging, wireless e-mail solutions, as well
as mobile voice and data services through AT&T Wireless and
Nextel. Also, Metrocall offers Integrated Resource Management
Systems with wireless connectivity solutions for medical, business
and campus environments. For more information on Metrocall visit
http://www.metrocall.com


METROMEDIA FIBER: Server Central Selects AboveNet as IP Transit
---------------------------------------------------------------
Server Central, Chicago's premier provider of managed hosting,
colocation, and bandwidth wholesaling, has selected AboveNet,
Metromedia Fiber Network, Inc.'s recently announced brand name, as
the next IP transit carrier to complement its bandwidth offering
in its Chicago data center.

"The addition of AboveNet to our existing portfolio of carriers
reaffirms to the world that we run the best network in Chicago,"
said Jordan Lowe, President of Server Central. "Our carriers and
peering enable us to reach almost every Tier-1 network and access
provider right in Chicago -- our customers consistently see speeds
under 1 millisecond to their destination networks."

Server Central's decision to select AboveNet was based on the rich
peering AboveNet maintains in Chicago, along with the speed and
reliability of their national fiber network. The impressive speed
of AboveNet's provisioning process was also a major factor in
Server Central's decision to select AboveNet. Mr. Lowe elaborates,
"The speed and diligence shown by AboveNet in filling our order is
unmatched; their engineers provisioned our circuits within four
hours of ordering. Between the quality of their bandwidth and
their speed in provisioning, AboveNet will be at the top of our
list for future projects."

Metromedia Fiber Network, Inc., which plans to change its name to
AboveNet Inc. upon emergence from bankruptcy, combines the most
extensive metropolitan area fiber network with a global optical IP
network, state-of-the-art data centers and award-winning managed
services to deliver fully integrated, outsourced communications
solutions for high-end enterprise companies. The all-fiber
infrastructure enables AboveNet customers to share vast amounts of
information internally and externally over private networks and a
global IP backbone, creating collaborative businesses that
communicate at the speed of light.

On May 20, 2002, Metromedia Fiber Network, Inc. and most of its
domestic subsidiaries commenced voluntary Chapter 11 cases in the
United States Bankruptcy Court for the Southern District of New
York. The Company has requested a hearing on confirmation of its
plan of reorganization on August 21.

Server Central is Chicago's premier provider of managed hosting
services for small to medium-sized businesses and enterprises,
providing a full suite of services for customers of all sizes. In
addition to web hosting and domain registration, Server Central
offers colocation, bandwidth wholesaling, dedicated/leased line
access, disaster recovery solutions in addition to equipment
sales, leasing, reseller programs, and management.

Server Central is a privately held Illinois corporation, providing
reliable Internet services to customers worldwide for over three
years. Server Central currently maintains POPs in Chicago, IL, and
Ashburn, VA, in Equinix -- http://www.equinix.com-- IBX
facilities.


MIRANT CORP: Begins Commercial Operation at Oregon Power Plant
--------------------------------------------------------------
Avista Corp. (NYSE: AVA) and Mirant (NYSE: MIR) announced the
commercial operation of the Coyote Springs 2 power plant developed
jointly by the two companies. The power plant, located near
Boardman, Ore., is a 280-megawatt, combined-cycle combustion
turbine facility, fueled by natural gas.

Avista and Mirant will share the plant's output equally.
Construction began in January 2001.

"We are very pleased to see this project come on line," said Scott
Morris, president of Avista Utilities. "Bringing company-owned
generation on line helps achieve our goal of being 'long' in
energy production. The output from this plant is needed to serve
our utility customers and it is designed to help us provide
efficient power resources for many years to come."

"Coyote Springs is a state of the art power plant that will
provide much needed energy to power the Pacific Northwest's
economic growth," said Anne Cleary, vice president, Mirant's West
region. "Using advanced, environmentally friendly, natural gas
technology, it will also help to balance the Northwest's
dependence on hydroelectric power."

Mirant is a competitive energy company that produces and sells
electricity in North America, the Caribbean, and the Philippines.
Mirant owns or controls more than 21,000 megawatts of electric
generating capacity globally. We operate an integrated asset
management and energy marketing organization from our headquarters
in Atlanta.  A complete list of assets is available at
http://www.mirant.com

Avista Corp. is an energy company involved in the production,
transmission and distribution of energy as well as other energy-
related businesses. Avista Utilities is a company operating
division that provides electric and natural gas service to
customers in four western states. Avista's non-regulated
subsidiaries include Avista Advantage, Avista Labs and Avista
Energy. Avista Corp.'s stock is traded under the ticker symbol
"AVA" and its Internet address is http://www.avistacorp.com

As reported in Troubled Company Reporter's Tuesday Edition, Mirant
was advised by representatives of an ad hoc committee of the
company's bondholders that the holders of approximately 66.67
percent of those bonds have indicated their support for the
company's exchange offers and related pre-packaged plan of
reorganization, as amended on June 30, and that they intend to
tender and vote accordingly.  The ad hoc committee represents
holders of the company's 2.5 percent convertible senior debentures
due 2021 and its 7.4 percent senior notes due 2004.


MISSISSIPPI CHEMICAL: Hires Gordian Group for Financial Advice
--------------------------------------------------------------
Mississippi Chemical Corporation and its debtor-affiliates want
approval from the U.S. Bankruptcy Court for the Southern District
of Mississippi to employ Gordian Group, LLC as their Restructuring
and Financial Advisors.

Due to the size and nature of the transactions contemplated by the
Debtors, the Debtors require Gordian Group's services.  Gordian
has considerable experience assisting troubled companies with
stabilizing their financial situations and assisting in the
restructuring or sale of the business and assets of financially
distressed companies. Gordian Group is already familiar with the
Debtors and their businesses and assets.

The Debtors expect Gordian Group to:

      a. evaluate, advise and assist the Debtors with respect to
         alternative restructuring options, business strategies
         and, if appropriate, sale and asset disposition
         transactions;

      b. advise as to available capital restructuring and
         financing alternatives, including without limitation,
         the restructuring of the 7.25% Senior Notes,
         recommendations of specific courses of action, and
         assistance with the structure, implementation and
         closing one or more alternative financial transaction
         structures and any debt and equity securities to be
         issued in connection with a financial transaction;

      c. represent the Debtors in discussions and negotiations
         with third parties, including creditors, potential
         advisors, and acquisition targets;

      d. provide the Debtors assistance as necessary and
         appropriate in connection with their Chapter I l
         proceedings;

      e. assist in preparing proposals to creditors, employees,
         shareholders and other parties-in-interest in connection
         with any financial transaction;

      f. assist the Debtors with the valuation of the Debtors'
         assets and/or operations;

      g. assist with presentations made to the Debtors' board of
         directors and/or creditors regarding, inter alia,
         potential financial transactions and/or other related
         issues; and

      h. render such other financial advisory and investment
         banking services as may be mutually agreed upon by the
         parties.

Gordian Group anticipates that Managing Directors, Peter S.
Kaufman and Henry F. Owsley, will be primarily involved in senior-
level services that Gordian will provide the Debtors.

The Debtors agree to pay Gordian:

      i) a $150,000 monthly fee; and

     ii) an additional fee of 1.5% of the principal amount or
         purchase price of any Financial Transaction.

Mississippi Chemical Corporation, through its direct or indirect
subsidiaries and affiliates, produces and markets all three
primary crop nutrients (nitrogen-phosphorus and potassium-based
products), as well as similar chemicals for industrial uses. The
Company filed for chapter 11 protection on May 15, 2003 (Bankr.
S.D. Miss. Case No. 03-02984).  James W. O'Mara, Esq., at Phelps
Dunbar LLP, represents the Debtors in their restructuring efforts.
When the Company filed for protection from its creditors, it
listed $552,9342,000 in total assets and $462,496,000 in total
debts.


MOHEGAN TRIBAL: Proposed $330MM Sr. Sub. Notes Gets BB- Rating
--------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB-' rating to
the Mohegan Tribal Gaming Authority's proposed $330 million senior
subordinated notes due July 15, 2009. Proceeds from this offering
will be used to refinance the outstanding 8.75% $300 million
senior subordinated notes due 2009 and to pay fees and expenses
associated with the repayment.

Concurrently, Standard & Poor's revised its outlook for MTGA to
stable from negative, while affirming its 'BB+' corporate credit
rating.  At June 30, 2003, pro forma for the sale of the proposed
notes, total debt outstanding is expected to be approximately $1.1
billion.

"The outlook revision reflects MTGA's improving operating
performance since completion of its major expansion (Project
Sunburst) in June 2002, and the expectation that these trends will
continue over the intermediate term. Also, given modest forecasted
capital spending levels, Standard & Poor's expects MTGA will
generate significant discretionary cash flow over the intermediate
term, to be used for debt reduction for the remainder of 2003 and
for the next few years," said credit analyst Peggy Hwan. Although
debt to EBITDA is still high for the rating, the company is
expected to de-leverage the balance sheet over the next several
quarters, bringing credit measures more in line within its
ratings.

The ratings for Connecticut-based MTGA, the entity formed to
operate the Mohegan Sun casino, reflect the high quality of the
Mohegan Sun and related amenities, limited regional competition,
and favorable demographics of the southeastern Connecticut market.
These factors are offset by a lack of cash flow diversity, high
debt leverage for the rating, and risks associated with gaming
legislative changes in the Northeast, which could ultimately lead
to increased competition.

Mohegan Sun is one of two Native American gaming casinos in
southeastern Connecticut. Although it currently operates in a
market protected by legislation, changes in the competitive
landscape remains a key longer-term rating factor. The market
could be affected by new competition in other parts of
Connecticut, Massachusetts, Rhode Island, New York, and New
Jersey. Standard & Poor's believes anticipated near-term capacity
growth in Atlantic City and the potential for casino gaming in New
York are likely to have only a modest effect on cash flow in the
Connecticut market, related to some overlap with New York and New
Jersey visitors.

Of greater competitive concern would be a sizable expansion by
Foxwoods or the realization of plans by certain Native American
tribes to build casinos in Rhode Island, Massachusetts, or other
parts of Connecticut. However, political hurdles exist to the
expansion of gaming in these states, and these issues are not
likely to be resolved quickly. Moreover, lead times for casino
development can be long, even if approved. Therefore, Standard &
Poor's does not expect meaningful competition from other tribes
for at least a few years.


NATIONAL STEEL: Gets Blessing to Expand Scope of E&Y Engagement
---------------------------------------------------------------
At the National Steel Debtors' request, the Court approves
expanding the scope of Ernst & Young LLP's engagement as the
Debtors' audit, tax and human resources consultants.
Specifically, Ernst & Young will perform an audit of 21 employee
benefit plans for the year ended December 31, 2002.

Pursuant to an engagement letter dated April 10, 2002, Ernst &
Young was initially required to audit and report on the financial
statements and supplemental schedules of the Debtors' benefit
plans for the year ended December 31, 2001.  The fixed fee for
the audit services was $194,000, including expenses.  Ernst &
Young also reviewed each of the Debtors' unaudited quarterly
information before they file their Form 10-Q.  The fee for each
quarterly review was $55,000.  The Additional Benefit Audit
Services will bring the year-end cost to $198,000, including
expenses.  E&Y's Quarterly Audit Fee is also increased to $75,000.

Mark A. Berkoff, Esq., at Piper Rudnick, in Chicago, Illinois,
explains that the Fixed Fee Arrangement is slightly higher than
the 2001 fixed fees due to:

     -- increases in the professionals' hourly rates; and

     -- Ernst & Young's estimate of additional hours to be incurred
        in connection with the Additional Benefit Audit Services is
        based on the Debtors' bankruptcy cases and issues with the
        Pension Benefit Guaranty Corporation.

The Quarterly Fixed Fee is also being raised to $75,000 because of
additional procedures:

     (a) required by SAS No. 100; and

     (b) that Ernst & Young would need to perform because it is not
         planning to perform an audit for the full year 2003.

Mr. Berkoff notes that certain procedures were previously used to
support both annual audit and the quarterly reviews and the time
was allocated to the annual audit and billed as part of the annual
audit fee.  These procedures included:

     (1) Updating internal control procedures at manufacturing
         locations and corporate headquarters to determine if
         there were any significant changes;

     (2) Review of company-prepared internal audit reports,
         scopes and management action plans;

     (3) Review of company board and board committee minutes;
         and

     (4) Accounting and auditing issue resolution performed with
         management throughout the year. (National Steel Bankruptcy
         News, Issue No. 31; Bankruptcy Creditors' Service, Inc.,
         609/392-0900)


NEFF CORP: Ratings on Watch after Subordinated Notes Repurchase
---------------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings on Neff
Corp., including its 'CCC' corporate credit rating, on
CreditWatch, with positive implications following Neff's recent
announcement that it had repurchased about $80 million face value
of its subordinated notes for about $50 million. The Miami,
Florida-based equipment-rental company has debt totaling
approximately $250 million.

"The rating action followed several events that are considered
positive," said Standard & Poor's credit analyst John Sico.

      These events are:

-- Neff made its June 1, 2003, interest payment on the
    subordinated notes;

-- Neff reached an agreement with its lenders to amend certain
    terms of its revolving credit facility;

-- The company received a waiver of certain defaults under its
    credit facility;

-- Neff repurchased $81 million in subordinated notes for a $47.7
    million term loan that matures in May 2008 and accrues payment-
    in-kind (PIK) interest at 11.25%; and

-- Cash interest was reduced by $8 million annually.

After announcing the repurchase of the notes, the company said it
intended to become a private company and deregister its common
stock and suspend reporting obligations with the SEC.

Standard & Poor's will seek to obtain ongoing financial
information from the company in a timely manner in order to
maintain surveillance.

Neff has no excess cash available, but it has about $15 million in
availability on its amended credit agreement following its
interest payment on the subordinated notes. The company now has
about $4 million in interest payments due semi-annually on its two
subordinated notes that have $75 million outstanding.

Standard & Poor's will meet with the company to discuss the near-
term business prospects and liquidity issues before taking a
rating action.


NET2000 COMMS: Chapter 7 Trustee Taps Peisner as Tax Consultants
----------------------------------------------------------------
Michael B. Joseph, the Chapter 7 Trustee of the estates of Net2000
Communications, Inc., sought and obtained approval from the U.S.
Bankruptcy Court for the District of Delaware to employ Peisner
Johnson & Company, LLP as its Special Tax Consultants.

Peisner is an accounting firm specializing in state and local
taxation. The Trustee retains Peisner to review and analyze all
tax returns for potential refunds, rebates, or reassessments of
federal, state or local, sales and use taxes, excise taxes and
other similar surcharges or vendor overcharges.  The analysis will
also encompass a review of potential overcharges or inappropriate
surcharges by vendors to the Debtor.  Peisner will also prepare
and file applications for refunds when appropriate.

Peisner will be paid on a contingency fee basis -- 40% of any tax
refunds identified by Peisner and received by the Trustee, for the
maximum period allowed by applicable state law.

Net2000 Communications, Inc., providers of state-of-the-art
broadband telecommunications services to high-end customers,
obtained Court approval to convert these cases to chapter 7
Liquidation proceedings on May 13, 2002 (Bankr. Del. Case No. 01-
11324).  Michael G. Wilson, Esq. and Jason W. Harbour, Esq. at
Morris, Nichols, Arsht & Tunnell represent the Debtors as they
wind up their operations.


NORTHWEST AIRLINES: Sells Worldspan Asset to Travel Transaction
---------------------------------------------------------------
Northwest Airlines Corporation (Nasdaq: NWAC) has sold its
interest in Worldspan L.P. to Travel Transaction Processing
Corporation, a corporation formed by Citigroup Venture Capital
Equity Partners L.P. and Teachers' Merchant Bank of Canada to
offer the Worldspan transaction.

Northwest received cash proceeds of approximately $280 million at
the closing, plus additional credits for future services from
Worldspan.

Delta Air Lines, Inc. (NYSE: DAL), Northwest Airlines and American
Airlines (NYSE: AMR) announced on March 4, 2003 their intention to
sell their interest in Worldspan.

Northwest Airlines is the world's fourth largest airline with hubs
at Detroit, Minneapolis/St. Paul, Memphis, Tokyo, and Amsterdam,
and approximately 1,500 daily departures. With its travel
partners, Northwest serves nearly 750 cities in almost 120
countries on six continents.

As reported in Troubled Company Reporter's May 22, 2003 edition,
Fitch Ratings assigned a rating of 'B' to the $150 million in
convertible senior unsecured notes issued by Northwest Airlines
Corp. The privately-placed notes carry a coupon rate of 6.625% and
mature in 2023. The Rating Outlook for Northwest is Negative.

The 'B' rating reflects continuing concerns over Northwest's
capacity to deliver the substantial improvements in operating
cash flow that will be necessary if the airline is to meet growing
cash financing obligations (interest, scheduled debt and capital
lease payments, rents and required pension plan contributions). In
light of the weak business travel demand environment that clouds
prospects for a quick rebound in industry unit revenue,
Northwest's future liquidity position will be influenced primarily
by the company's success in negotiating labor cost reductions with
its unionized employees. While the dialogue with labor is ongoing,
there are no signs that a substantial reduction in labor costs is
imminent.


ORGANOGENESIS: Massachusetts Court Approves Disclosure Statement
----------------------------------------------------------------
Organogenesis Inc. (ORGG-PK) announced that on June 26, 2003 the
U.S. Bankruptcy Court for the District of Massachusetts (i)
approved the disclosure statement related to the Company's plan of
reorganization filed on June 18, 2003, as amended and
(ii) authorized the Company to solicit approval of the Plan which
contemplates the Company's emergence from Chapter 11 protection on
or before August 31, 2003.

At the conclusion of the hearing, Judge William C. Hillman, of the
Bankruptcy Court of Massachusetts, approved the Company's
disclosure statement as having adequate information for the
purpose of solicitation. The Company expects to distribute the
disclosure statement and related ballots on July 2, 2003, which is
the date the Court has established as the record date for the
purpose of determining which creditors and shareholders are
entitled to receive solicitation packages and, where applicable,
vote on the Plan. Final ballots for voting on the Plan are due by
4:30 PM EDT on August 1, 2003. The confirmation hearing for the
Court's approval of the Plan is scheduled for August 12, 2003 at
1:30 PM EDT.

"We are pleased to announce another positive step toward
completing our reorganization process and we now look forward to
soliciting votes on the plan, which is supported by the Official
Committee of Unsecured Creditors," said Alan Ades, Chairman of the
Company and a member of the group which is providing the funding
for the Plan.

The Plan contemplates that, subject to certain possible
adjustments and limitations set forth in the Plan, a cash
distribution of 35% will be made to the holders of allowed general
unsecured claims but that no distribution will be made on shares
of the Company's outstanding preferred and common stock, which
will be cancelled on the Plan's effective date.

Organogenesis was the first company to develop and gain FDA
approval for a mass-produced product containing living human
cells. The Company's principal product, Apligraf(R), a living, bi-
layered skin substitute, has received FDA approval for the
treatment of diabetic foot ulcers and venous leg ulcers.


OWENS CORNING: Court Approves $50MM OC Metals Systems Asset Sale
----------------------------------------------------------------
Owens Corning and its debtor-affiliates obtained the Court's
approval pursuant to Section 363 of the Bankruptcy Code to:

   -- sell, transfer, convey, assign and deliver the Purchased
      OC Metal Systems Assets to ALSCO Acquisition Corp. or to a
      Successful Bidder free and clear of liens, claims and
      encumbrances; and

   -- execute and enter into a supply agreement and a transition
      services agreement with the Purchaser.

The Debtors Exterior Systems, OC Fiberglas Technology, Inc. and,
for limited purposes, Owens Corning, entered into an Asset
Purchase Agreement with ALSCO Acquisition Corp., as the Purchaser,
for, inter alia:

   -- the sale of certain of Exterior Systems' assets and certain
      of OC Fiberglas Technology's trademarks,

   -- the assumption by the Purchaser of certain liabilities,

   -- the execution and entry of a supply agreement and
      transition services agreement, and

   -- the Debtors' assumption and assignment to the Purchaser of
      certain executory contracts and unexpired leases.

The Debtors determined to sell the assets utilized in the business
of Owens Corning Metal Systems, a division of Exterior Systems, as
the best way to maximize value for the benefit of the estates and
creditors is to expose the Assets for competitive bidding through
an Auction pursuant to the Sale Procedures.  Exterior Systems, OC
Fiberglas Technology, Inc. and, for limited purposes, Owens
Corning, entered into the Asset Purchase Agreement with ALSCO on
March 19, 2003.

Owens Corning Metal Systems is a division of Exterior Systems,
which is an indirect, wholly owned subsidiary of Owens Corning.
OC Metal Systems' fabricated products essentially consist of
residential aluminum building products, which support both the
traditional aluminum and vinyl siding markets, i.e. as trim coil,
soffits, sidings, accessories, roof moldings and rainware used in
the installation of gutter systems.  OC Metal Systems also
manufactures specialty coil and unpainted aluminum sheets.  OC
Metal Systems conducts its business operations from these
facilities:

     1. a plant in Ashville, Ohio (owned);

     2. a plant in Richmond, Virginia (owned);

     3. a plant in Beloit, Wisconsin (leased);

     4. a fabrication facility (leased) and a coil coating
        facility (owned) in Roxboro, North Carolina; and

     5. administrative offices in Raleigh, North Carolina
        (leased). (Owens Corning Bankruptcy News, Issue No. 54;
        Bankruptcy Creditors' Service, Inc., 609/392-0900)


PAC-WEST TELECOM: Names Hank Carabelli as New President and CEO
---------------------------------------------------------------
Pac-West Telecomm, Inc. (Nasdaq: PACW), a provider of integrated
communications services to service providers and business
customers in the western U.S., announced that Hank Carabelli has
assumed the position of President and Chief Executive Officer.
Formerly the company's President and Chief Operating Officer,
Carabelli succeeds Wally Griffin who will continue to serve as
Chairman of the Board of Directors.

Griffin praised Carabelli, saying, "The Board and I conducted an
extensive search to identify the right individual to lead Pac-West
into the future. We have complete confidence that Hank's
experience, leadership, energy, and integrity will take the
company to new heights. While we have spent the last six months
formally transitioning our roles, Hank and I have spent the past
two years repositioning the company for new leadership and new
opportunities. I look forward to continuing to work with Hank and
the Pac-West team as Chairman of the Board of Directors as we
build a great organization, recognized for service excellence."

Carabelli joined Pac-West as President and COO in June of 2001. He
was appointed as a Director of Pac-West in January of this year.
He has over 25 years of industry experience, including serving as
COO at ICG, a Colorado based competitive local exchange carrier,
President of @Link Networks, a broadband service provider, and 19
years in management with Ameritech, Michigan Bell, and Bellcore.

Carabelli said, "I joined Pac-West to participate in a truly
unique opportunity. I believe that Pac-West is located in the
right place -- California, with the right business model and the
right team in place. We are surviving the telecom 'perfect storm',
and are emerging a stronger and more focused company as evidenced
by our accomplishments in 2002, which included 39% line growth,
21% minutes of use growth, 7% operating expense reductions, 11%
SG&A expense reductions, and a 37% reduction in long-term debt
year-over-year. We accomplished this while positioning the company
to deliver what we believe no other telecom company has
consistently delivered -- Five-Star Customer Service. To that end,
our entire organization is committed to setting the standard for
service excellence in the communications industry."

Griffin joined Pac-West in September of 1998 as President and CEO
to lead the company through a recapitalization and initial public
offering of its common stock. He was appointed Chairman of the
Board of Directors in June of 2001.

Founded in 1980, Pac-West Telecomm, Inc. is one of the largest
competitive local exchange carriers headquartered in California.
Pac-West's network carries over 100 million minutes of voice and
data traffic per day, and an estimated 20% of the dial-up Internet
traffic in California. In addition to California, Pac-West has
operations in Nevada, Washington, Arizona, and Oregon. For more
information, visit Pac-West's Web site at http://www.pacwest.com

                          *  *  *

As reported in Troubled Company Reporter's May 1, 2003 edition,
Standard & Poor's Ratings Services lowered its corporate credit
rating on Stockton, Calif.-based competitive local exchange
carrier Pac-West Telecomm Inc. to 'D' from 'CC'. The rating on
the 13.5% senior notes due 2009 has been lowered to 'D' from
'C'. The downgrade is due to the company's completion of a cash
tender offer to exchange its 13.5% senior notes at a significant
discount to par value. Standard & Poor's views such an exchange
as coercive and tantamount to a default on the original terms of
the notes.

Given the company's significant dependence on reciprocal
compensation (the rates of which the company expects to further
decline in 2003) and its limited liquidity, Pac-West will likely
find the implementation of its business plan continue to be
challenging.


PACIFIC GAS: Fitch Ups Sr. Debt & Preferreds Ratings to BB-/DDD
---------------------------------------------------------------
Fitch has raised the ratings of Pacific Gas and Electric Company's
senior secured debt and preferred stock to 'BB-' and 'DDD',
respectively, from 'DDD' and 'D'. PG&E's secured debt and
preferred stock remains on Rating Watch Positive by Fitch.

The ratings reflect the fact that PG&E, a debtor-in-possession
company since it filed for bankruptcy protection in April 2001, is
currently paying all interest payments on its outstanding debt
securities and Fitch's view that the utility is likely to continue
to do so through the remainder of the bankruptcy process. In
addition, while the bankruptcy court has not permitted principal
repayments on unsecured debt obligations as they matured since the
commencement of the bankruptcy proceedings, authority was given
for principal repayment of a secured debt obligation that came due
last year. Consequently, the ratings assume that the bankruptcy
court will approve PG&E's pending motion to authorize payment of
approximately $281 million of maturing mortgage bond principal on
Aug. 1, 2003 and that similar authority would be granted to repay
$310 million of maturing secured bonds in 2004 and $289 million in
2005, if necessary.

Dividend payments on preferred stock have also been interrupted
during the bankruptcy. These payments are, however, cumulative,
and the arrears must be cleared before PG&E can resume common
dividend payments following emergence from bankruptcy. It is
noteworthy that all plans of reorganization submitted to-date have
contemplated full recovery of all valid obligations with interest.
It is also contemplated that the preferred dividend arrearages
would be cleared together with other obligations, upon emergence
from bankruptcy. This, combined with constructive regulatory
developments in California and energy market fundamentals,
suggests a high probability that full recovery will be realized by
investors. As a consequence, the rating of the secured debt
obligations has been raised to 'BB-', in line with Fitch's policy
on rating performing pre-petition debt obligations of companies in
bankruptcy, while the rating of the preferred stock has been
raised to 'DDD', signifying an ultimate recovery expectation of
between 90%-100% of outstanding amounts.

Separately, the listing of PG&E's secured debt and preferred stock
on Rating Watch Positive considers the favorable rating
implications of the recently announced proposed bankruptcy
settlement reached by the California Public Utilities Commission
Staff, PG&E and PG&E Corp. The settlement agreement is the basis
for the company's new disclosure statement and plan of
reorganization, which were filed by PG&E on June 27, 2003, with
the Official Creditors Committee as co-proponent. The CPUC and the
bankruptcy court are expected to issue a ruling regarding the
proposed bankruptcy settlement agreement and new plan of
reorganization, respectively, by year-end 2003. Timely approval of
the proposed settlement agreement and the new plan of
reorganization would likely result in positive resolution of the
Rating Watch status.

On June 19, 2003, PG&E announced a proposed settlement with the
CPUC Staff regarding their competing plans of reorganization. The
proposed settlement agreement is subject to approval of the Boards
of Directors of Pacific Gas and Electric and its corporate parent,
PG&E Corp., the CPUC, and the bankruptcy court. Under the terms of
the agreement, PG&E and its parent will abandon efforts to
disaggregate the utility and submit a revised plan of
reorganization that will keep the utility vertically integrated
and subject to the jurisdiction of the CPUC and other regulatory
agencies. The proposed settlement agreement resolves pending filed
rate doctrine litigation, among other proceedings, and establishes
a $2.21 billion regulatory asset to be recovered over nine years.
Any refunds from or claim offsets against power suppliers will be
used to reduce the $2.21 billion regulatory asset. Also, under the
terms of the agreement, the CPUC is expected to reduce retail
rates approximately $350 million per year beginning Jan. 1, 2004

PG&E filed a new disclosure statement and plan of reorganization
on Friday, June 27, 2003 that reflects the terms of the proposed
settlement agreement. The approval process for the POR, including
a creditor vote, and the proposed settlement will proceed along
parallel paths before the bankruptcy court and the CPUC,
respectively. The CPUC is expected to issue a ruling and the plan
could be confirmed by the bankruptcy court by year-end 2003. Based
on Fitch's analysis, the company's cash flow and earnings coverage
and leverage ratios would improve dramatically with adoption of
the plan and the company's emergence from bankruptcy in 2004.
Importantly, the settlement would align the interests of, and
defuse a bitter disagreement between, the management of the
state's largest utility and the CPUC.


PENN TREATY: Better Performance Spurs S&P's B- and CCC- Ratings
---------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B-' counterparty
credit and financial strength ratings on long-term care insurer
Penn Treaty Network America Insurance Co.

At the same time, Standard & Poor's affirmed its 'CCC-'
counterparty credit rating on PTNA's parent, Penn Treaty American
Corp. and revised the outlook on these companies to positive from
stable.

"The outlook revision is based on PTNA's progress in obtaining
approval from additional states to resume sales of its long-term
care insurance products, the completed recapitalization of the
parent company, and the company's successful execution of a well-
controlled growth strategy," said Standard & Poor's credit analyst
Neal Freedman.

Standard & Poor's expects PTAC's pretax consolidated GAAP
operating earnings (which exclude market gains and losses on the
reinsurance experience account and include interest expense) to be
$4 million-$6 million 2003 on new long-term care insurance sales
of $8 million-$10 million reflecting annualized premium of $25
million-$30 million. Capitalization of the operating insurance
companies is expected to remain adequate at year-end 2003.


PILLOWTEX CORP: Term Loan Lenders Agree to Forbear Until July 10
----------------------------------------------------------------
Pillowtex Corporation (OTC Bulletin Board: PWTX) entered into a
forbearance agreement with its term loan lenders, under which the
Company's lenders have agreed through July 10, 2003 to abstain
from exercising the rights and remedies available to them as a
result of certain defaults under the Company's term loan
agreement.

The Company informed its term loan lenders that it did not believe
that it would be able to comply with the interest coverage ratio
and leverage ratio covenants contained in the term loan agreement
for the fiscal quarter ended June 28, 2003. In addition, the
Company did not make the principal or interest payments required
under the term loan on June 30, 2003. The Company is continuing to
work with its term loan and revolving loan lenders in reviewing
its strategic alternatives.

Pillowtex Corporation, with corporate offices in Kannapolis, N.C.,
is one of America's leading producers and marketers of household
textiles including towels, sheets, rugs, blankets, pillows,
mattress pads, feather beds, comforters and decorative bedroom and
bath accessories. The Company's brands include Cannon, Fieldcrest,
Royal Velvet, Charisma and private labels. Pillowtex currently
employs approximately 7,800 people in its network of manufacturing
and distribution facilities in the United States and Canada.


PRIMUS TELECOMMS: S&P Revises Rating Outlook to Stable from Neg.
----------------------------------------------------------------
Standard & Poor's Ratings Services revised the outlook on McLean,
Virginia-based international long-distance telecommunications
provider Primus Telecommunications Group Inc., to stable from
negative.

The outlook revision reflects the company's success in maintaining
and increasing its customer base, as well as associated revenues
and EBITDA, in a very challenging economic and competitive
climate.

In the first quarter of 2003, Primus' revenues grew 23% from the
prior year. EBITDA for the first quarter grew substantially as
well and totaled $33 million for the first quarter of 2003, versus
$21 million for the prior year. More importantly, the company has
significantly lowered its total debt in the past few years through
open market debt repurchases, vendor settlements, as well as
conversions of convertible subordinated debt.

As a result of these activities, debt declined to $562 million at
March 31, 2003, from $668 million at Dec. 31, 2001, and $1.256
billion at Dec. 31, 2000. The resultant debt to annualized EBITDA
for the first quarter of 2003 totaled a fairly moderate 4.3x. Yet,
despite these improvements and the fairly limited level of debt to
EBITDA, the company still has a very weak credit profile.
International long distance is highly competitive and long-term
business risks are uncertain.

"Standard & Poor's had been concerned about the company's
liquidity in light of the relatively high concentration of its
business with financially distressed telecommunications carriers,"
said Standard & Poor's credit analyst Catherine Cosentino. "In
recent periods, nevertheless, Primus has been able to reduce its
dependence on the carrier sector, which now makes up about 20% of
its revenues, down from 24% in the first quarter of 2002. This has
been accomplished through ongoing growth in the residential long-
distance base, as well as tightened credit policies for carrier
customers."

Primus has also been able to secure additional funding for its
operating and capital needs.

The ratings continue to reflect the high business risk of the
international long distance telecommunications industry. This
business is characterized by substantial competition and attendant
pricing pressures and churn, particularly for the consumer sector.

Primus is a global facilities-based telecommunications carrier
offering bundled voice, data, Internet, digital subscriber line,
Web hosting, enhanced application, virtual private network, and
other value-added services.


QWEST: Gets Financial Reporting Waivers for Facility & Term Loan
----------------------------------------------------------------
Qwest Communications International Inc. (NYSE: Q) has received
waivers regarding 2002 financial reporting for its Qwest Services
Corporation credit facility and its QwestDex term loan. The 2002
financial reporting due to the lenders by July 15, 2003, has been
extended to no later than September 30, 2003. In addition, the
company received waivers for first quarter 2003 financial
information, which was also extended to no later than
September 30, 2003.

Qwest sought the waivers because it is still in the process of
restating prior period financial statements necessary to complete
the financial reporting for these periods.

"We continue to make significant progress on our financial
transformation including the restatement," said Oren G. Shaffer,
Qwest vice chairman and CFO. "I believe we have more than adequate
time to complete our financial statements and I'm pleased with the
continued support from our banks and lenders during this process."

Qwest Communications International Inc. (NYSE: Q) -- whose
December 31, 2002 balance sheet shows a total shareholders' equity
deficit of about $1 billion -- is a leading provider of voice,
video and data services to more than 25 million customers. The
company's 50,000 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


REAL ESTATE SYNTHETIC: Fitch Rates 5 Classes at Low-B Levels
------------------------------------------------------------
Fitch rates the securities of RESI Finance Limited Partnership
2003-B and RESI Finance DE Corporation 2003-B. The rating on the
securities addresses the timely payment of interest and ultimate
repayment of principal upon maturity.

         -- $70,996,000 class B3 notes 'A';
         -- $26,624,000 class B4 notes 'A-';
         -- $35,498,000 class B5 notes 'BBB';
         -- $14,199,000 class B6 notes 'BBB-';
         -- $17,749,000 class B7 notes 'BB';
         -- $7,100,000 class B8 notes 'BB-';
         -- $14,199,000 class B9 certificates 'B+';
         -- $8,875,000 class B10 certificates 'B';
         -- $8,875,000 class B11 certificates 'B-'.

The transaction is a synthetic balance sheet securitization that
references a $17.7 billion of diversified portfolio of primarily
jumbo, A-quality, fixed rate, first lien residential mortgage
loans. The ratings are based upon the credit quality of the
reference portfolio, the credit enhancement provided by
subordination for each tranche, the financial strength of Bank of
America, N.A., as swap counterparty, and the sound legal structure
of the transaction. The reference portfolio consists of 30-year
and 15-year mortgage loans originated by various lenders. The
issuers have entered into a financial guaranty contract with
BOANA, documented under an International Swaps and Derivatives
Association agreement, and receive a premium in return for credit
protection on the reference portfolio.

The proceeds of the issued securities will be used to purchase
eligible investments (collateral), pursuant to a forward delivery
agreement between the trustee and BOANA, whereby the co-issuers
are obligated to purchase eligible investments from BOANA at a
specified yield on each determination date. Eligible investments
will consist of direct obligations of or guaranteed by the U.S.,
Federal National Mortgage Association, Federal home Loan Mortgage
Corporation, Federal Home Loan Bank, or any other agency backed by
the U.S. The collateral is pledged first, to the counterparty to
reimburse for credit losses on reference portfolio during the term
of the FGC, and second to the noteholders for repayment of
principal at maturity. Interest earned on the collateral during
the term of the FGC is used in combination with the premium from
BOANA to make monthly security payments.


RMF COMM'L: Fitch Further Junks Ser. 1995-1 Class F Rating at C
---------------------------------------------------------------
Fitch Ratings downgrades RMF Commercial Mortgage Pass-Through
Certificates, series 1995-1's $10.2 million class E to 'B' from
'BB-' and the $7.3 million class F to 'C' from 'CCC'. At the same
time Fitch removes classes E and F from Rating Watch Negative. In
addition, the following classes are affirmed by Fitch: $15 million
class A-2 and interest-only classes I-2 and I-3 at 'AAA'; $8.8
million class B at 'AA+'; $8.8 million class C at 'A+'; and $7.3
million class D at 'BBB'. Fitch does not rate the class G or H
certificates. The rating actions follow Fitch's review of the
transaction, which closed in December 1995.

The downgrades to classes E and F reflect continuing deterioration
in the transaction's performance, the expected losses on the EHA
pool, and the increasing interest shortfalls. The deal's weaker
operating performance is due to higher operating costs, heavy
competition, weak demand, and regulatory compliance issues. Three
loans (38%) are currently in special servicing, including the EHA
pool (20%), which is currently real estate-owned. Currently, the
master servicer, ORIX Capital Markets, has deemed $167 thousand in
servicing advances to the EHA pool non-recoverable. ORIX is
recouping these advances and legal fees associated with the EHA
pool over time to limit the interest shortfalls to non-investment
grade classes. In addition, Fitch is concerned that additional
advances may be deemed non-recoverable in the future.

The EHA pool ($12.5 million or 20%), originally consisting of six
cross-collateralized and cross-defaulted loans, has been in
special servicing since February 2000, when the borrower/operator,
Mariner Post Acute, filed for Chapter 11 bankruptcy protection. A
reorganization plan was agreed upon in March 2002 and five
properties became REO in November 2002. The sixth loan was assumed
by a new entity and is performing. The special servicer is
currently marketing two of the properties for sale and is deciding
on the plan of action for the remaining three properties. The
total appraised value for the properties was $4.85 million as of
October 2002 and therefore large losses are expected.

The Indigo Manor loan (10%) has been in special servicing since
February 2000. This loan is 60+ days delinquent. The operator, who
has been in place since 2001, is currently negotiating a potential
purchase of the facility with the borrower. The facility's
performance has been improving although occupancy remains low at
70%. A total of $300,000 in real estate taxes is owed on this
property.

The IHCP pool (5%), which originally consisted of two loans, has
been in special servicing since May 2002 and is currently 90+ days
delinquent. One of the properties was sold for $850,000, with the
remaining loan balance allocated to the second loan. The property
securing the remaining loan is performing well, with a trailing-
twelve months September 2002 debt service coverage ratio of 2.64
times. However, the property's operator, Centennial, is in
bankruptcy.

As of the May 28, 2003 distribution report, the transaction's
certificate balance declined by approximately 57% to $63.2 million
from $146.1 million at issuance. This reduction is due to
scheduled amortization as well as prepayments. The pool is
concentrated by loan balance and geographic location. Currently,
the certificates are collateralized by 20 fixed-rate mortgage
loans, with significant property concentrations in TN (24%), IL
(17%), and PA (12%).

Fitch applied various hypothetical stress scenarios, taking into
consideration all of the above concerns. Under these stress
scenarios, the expected subordination levels justify the
affirmations to the senior classes and downgrades to the junior
classes. Fitch will continue to monitor this transaction, as
surveillance is ongoing.


SAFETY-KLEEN: Wants Clearance for South Carolina DHEC Agreement
---------------------------------------------------------------
The Safety-Kleen Debtors seek Judge Walsh's authority to enter
into and make a payment under an Interim Agreement and Stipulated
Order between the Debtors and The South Carolina Department of
Health and Environmental Control, to obtain the assignment and
release of various claims DHEC has or may have against Laidlaw,
Inc., or any of its subsidiaries or affiliates.

Michael W. Yurkewicz, Esq., at Skadden Arps, in Wilmington,
Delaware, explains that Safety-Kleen (Pinewood), Inc., operated a
hazardous waste treatment, storage and disposal facility and a
hazardous waste landfill in Sumter County, South Carolina.  On
March 21, 1994, DHEC issued a final permit to Safety-Kleen
Pinewood, which allowed SK Pinewood to operate the Pinewood
Facility and required SK Pinewood to maintain certain financial
assurances for closure, post-closure and liability coverage for
the Pinewood Facility.

As a result of DHEC's orders, SK Pinewood has ceased accepting and
no longer accepts waste for treatment, storage or disposal at the
Pinewood Facility.  DHEC has asserted that SK Pinewood and other
Debtors are responsible for undertaking closure and post-closure
care activities at the Pinewood facility.  DHEC also asserted that
it should be allowed an administrative expense claim for
$111,477,474 to be used towards any necessary remediation of any
releases of hazardous constituents from the Pinewood Facility
during the 100 years following closure of that facility.

On December 20, 2001, DHEC filed claim nos. 913, 914 and 915,
against Laidlaw, USA, Inc., Laidlaw Transportation, Inc. and
Laidlaw Inc.  Each proof of claim was for $164,048,676 and
asserted, among other things, obligations of the Laidlaw Debtors
to fund financial mechanisms under applicable environmental laws
for all environmental obligations relating to the Pinewood
Facility.  On July 18, 2002, the Debtors and Laidlaw, along with
certain other parties, entered into a settlement of outstanding
claims by and among them.  The Debtors anticipate that
distributions in connection with the Laidlaw Settlement will be
made at the beginning of July 2003 and that the Debtors will
receive approximately $62,000,000 in cash and approximately
5,700,000 shares of newly issued Laidlaw common stock.  The
distributions to the Debtors under the Laidlaw Settlement are
conditional on the release of DHEC's claims against Laidlaw.  The
Court approved the Laidlaw Settlement on August 30, 2002.

On October 15, 2002, following lengthy and complex negotiations,
the Debtors and DHEC entered into a settlement agreement resolving
DHEC's claims with respect to the Pinewood Facility.  The DHEC
Settlement Agreement is incorporated into the Plan, which
provides, among other things, that to the extent necessary, the
Plan constitutes a motion for approval of the Settlement
Agreement.  Under the Plan and pursuant to the terms of the DHEC
Settlement Agreement, certain things will occur on the Effective
Date in full satisfaction, settlement, release and discharge of
and in exchange for the Allowed DHEC's Administrative Claim:

        (a) SK Pinewood will transfer the Pinewood Facility and
            related personal property, including vehicles,
            machines, equipment and supplies, located at the
            Pinewood Facility to the Pinewood Site Trust;

        (b) The Debtors will:

              (i) pay $13,162,768 -- subject to adjustment for
                  work performed prior to the Effective Date and
                  for certain administrative costs of the Pinewood
                  Site Trust -- to the Pinewood Site Trust, and

             (ii) transfer to the Pinewood Site Trust ownership of
                  a single-payment, fully guaranteed annuity,
                  which will pay out $133,000,000 -- subject to
                  adjustment for certain administrative costs of
                  the Pinewood Site Trust -- over the next 100
                  years;

        (c) The Debtors will create the new Environmental
            Impairment Trust Fund into which the funds presently
            in the GSX Contribution Trust Fund will be deposited;
            and

        (d) The Debtors will pay an additional $14,500,000 into
            the New Environmental Impairment Trust Fund.

The Debtors intend to make all payments on account of the DHEC
Administrative Claim from the proceeds of the Laidlaw Recovery.
The DHEC Settlement Agreement also provides that DHEC will assign
or transfer to SK Pinewood or its designee any and all claims that
DHEC may have against Laidlaw, which will allow the Debtors to
release claims and receive distributions from Laidlaw.

                     Terms of the Interim Agreement

Rather than wait until the Effective Date of the Plan to receive
the Laidlaw Recovery, DHEC and the Debtors have agreed to enter
into the Interim Agreement.  The Interim Agreement provides, among
other things, that:

        (1) DHEC will assign and transfer to SK Pinewood or its
            designee any and all claims DHEC may have against
            Laidlaw;

        (2) SK Pinewood will deposit $5,000,000 into an escrow
            account which:

               (a) will be released to the New Environmental
                   Impairment Trust Fund and reduce the
                   $14,500,000 obligations to fund the New
                   Environmental impairment Trust Fund by
                   $5,000,000 if the DHEC Settlement Agreement
                   is approved, or

               (b) will be transferred into the existing GSX
                   Contribution Trust Fund, if the Plan is not
                   approved;

        (3) The $5,000,000 escrow will be funded solely from the
            Laidlaw Recovery, which will be made available to the
            Debtors as a result of the Interim Agreement;

        (4) The escrow agreement will be mutually acceptable to
            all parties and be made with a financial institution;

        (5) The Settlement Agreement will be deemed amended in
            accordance with the terms of the Interim Agreement;

        (6) The Interim Agreement is conditional upon a final non-
            appealable order approving the Debtors' entry into the
            Interim Agreement.

The $5,000,000 payment that the Debtors will make under the
Interim Agreement will be used to partially fund the New
Impairment Trust Fund, reducing the Debtors' obligations under the
Settlement Agreement and the Plan by $5,000,000, when the Plan
becomes effective.  The Debtors believe that there is a
significant likelihood that Laidlaw will distribute the Laidlaw
Recovery to the Debtors before the Confirmation Hearing Date if
the DHEC Claims are released.  Accordingly, by entering into the
Interim Agreement, DHEC will immediately transfer the DHEC Claims
to the Debtors, enabling the Debtors to release the claims and
receive the Laidlaw Recovery.

In addition, by receiving the Laidlaw Recovery earlier than the
Effective Date of the Plan, the Debtors may, should they choose,
take steps to hedge or eliminate any market risk related to the
Laidlaw stock, including the sale of such stock in the open
market.  Moreover, by receiving the Laidlaw Recovery, the Debtors
will be able to earn significant interest on the cash received
from Laidlaw.

Finally, the Debtors believe that receipt of the Laidlaw Recovery
earlier than the Effective Date of the Plan will assist the
Debtors both logistically and financially in making payments
required under the Plan.  Accordingly, the Debtors believe that
payment of $5,000,000 into escrow at this time is beneficial to
the Debtors and their estates. (Safety-Kleen Bankruptcy News,
Issue No. 59; Bankruptcy Creditors' Service, Inc., 609/392-0900)


SAKS INC: Fitch Affirms BB+/BB- Bank Loan & Senior Note Ratings
---------------------------------------------------------------
Fitch Ratings has affirmed its 'BB+' rating of Saks Incorporated's
$700 million secured bank facility, and its 'BB-' rating of the
company's $1.2 billion of senior notes. The Rating Outlook remains
Negative.

The ratings reflect Saks' solid position within its markets
balanced against its weak operating results and high financial
leverage. Saks' operations have been pressured by soft apparel
sales and growing competition from specialty and discount
retailers. Sales at the company's luxury retail business (Saks
Fifth Avenue) have also been hurt by declines in international
tourism. Saks is projecting flat to negative comparable store
sales in 2003, which will further pressure earnings and cash flow.

Saks strengthened its liquidity position with the sale of its
credit business in the first quarter, generating net proceeds of
around $330 million. These proceeds, which brought cash balances
to $503 million as of 5/3/03, will be used to repurchase common
stock and reduce debt, as well as reinvest in the business. Though
the pace of debt reduction will be slowed by a lack of near-term
debt maturities, the company will be able to repay $142 million of
debt maturing in 2004 from cash on hand.

Saks' credit measures remain weak despite meaningful debt
reduction over the past four years. EBITDAR coverage of interest
plus rents of 2.0 times in the twelve months ended 5/3/03 compares
with 1.7x in 2001 and 2.5x in 1999. Leverage as measured by lease-
adjusted debt to EBITDAR of 4.4x in twelve months ended 5/4/02
compares with 5.3x in 2001 and 4.0x in 1999.

The challenging retail environment, together with lost income from
the sale of the credit business, will further pressure these
measures in 2003. However, it is assumed that a gradual recovery
in cash flow beginning in 2004, together with projected debt
reduction, will lead to modest improvement in Sak's credit profile
over the medium-term. Nevertheless, the Negative Rating Outlook
will remain in place until sales and operating trends turn around.


SAMSONITE CORP: Sets Annual Shareholders' Meeting for July 31
-------------------------------------------------------------
Samsonite Corporation (OTC Bulletin Board: SAMC) announced that
its annual meeting of stockholders will be held at 8:00 a.m.
(Mountain time) on Thursday, July 31, 2003, at the DoubleTree
Hotel Denver Southeast, 13696 East Iliff Place, Aurora, Colorado.

At the annual meeting, holders of record of the Company's common
stock as of the close of business on June 27, 2003 will be asked
to vote on, among other things, proposals to facilitate completion
of the Company's previously- announced recapitalization
transaction. Separately, the Company is also commencing the
solicitation of consents from holders of its 13-7/8% senior
redeemable exchangeable preferred stock to approve an amendment to
the certificate of designation governing the terms of such stock.
Today, the Company will begin mailing the annual meeting proxy
statement, together with the Company's annual report, to holders
of common stock and a consent solicitation statement to holders of
preferred stock. As previously announced, the Company entered into
a recapitalization agreement pursuant to which new investors will
purchase 106,000 shares of a new series of the Company's
convertible preferred stock for $106 million and the Company will
retire its outstanding shares of 13-7/8% senior redeemable
exchangeable preferred stock (which had an aggregate liquidation
preference of approximately $339.3 million at April 30, 2003)
through the conversion of such shares into a combination of up to
54,000 shares of new convertible preferred stock and (assuming the
full amount of new convertible preferred stock is elected to be
received by existing preferred stockholders) approximately 205
million shares of common stock, plus warrants.

The Company also announced that it is commencing a solicitation of
consents from holders of its 10-3/4% senior subordinated notes due
2008 to amend the indenture governing the terms of such notes so
that the new investors in the recapitalization would be Permitted
Holders, as defined in the indenture.

This press release does not constitute an offer to sell or the
solicitation of an offer to buy any of the securities which may be
issued in connection with the recapitalization.

Samsonite is one of the world's largest manufacturers and
distributors of luggage and markets luggage, casual bags, business
cases and travel-related products under brands such as
SAMSONITE(R), AMERICAN TOURISTER(R), LARK(R), HEDGREN(R),
LACOSTE(R) and SAMSONITE(R) black label.

                           *   *   *

As reported in the May 8, 2003, issue of Troubled Company
Reporter, the ratings of Samsonite Corporation were affirmed by
Moody's Investors Service. Outlook for the ratings was changed
to developing from negative due to the company's planned
recapitalization pact that could sizably reduce the company's
debts and refinance its current debt facility.

                       Affirmed Ratings

    * B3 - Senior implied rating;

    * B2 - $70.0 million senior secured revolving credit facility
           due in June 2004;

    * B2 - $35.2 million senior secured European term loan
           facility due June 2004;

    * B2 - $46.2 million senior secured U.S. term loan facility
           due June 2005;

  * Caa2 - $322.8 million 10-3/4% senior subordinated notes due
            June 2008;

     * C - $309.1 million 13-7/8% senior redeemable preferred
           stock due June 2010;

  * Caa1 - Senior unsecured issuer rating.


SLI INC: Successfully Emerges from Chapter 11 Proceedings
---------------------------------------------------------
SLI International Holdings, LLC, f/k/a SLI, Inc., announced that
its plan of reorganization became effective on June 30, 2003, and
the Company and its U.S. subsidiaries have emerged from Chapter 11
protection as a private company, with renewed financial strength
and a streamlined capital structure.

The Company announced that SLI, Inc. has been converted to a
Delaware limited liability company, and its name has been changed
to SLI International Holdings, LLC.

"This is a positive result, and one that we have all worked hard
to achieve," said a spokesperson from the Company. "We want to
thank our employees, who stayed focused on the goal of
reorganizing, and our customers and suppliers for their support.
With the reorganization completed, the Company's financial health
has been restored and it is well positioned to continue its
leadership in the lighting systems industry."

As previously announced and in accordance with the Plan, effective
upon today's emergence, holders of prepetition secured claims
received 100% of the equity in reorganized SLI. Holders of general
unsecured claims will receive a pro rata distribution of an agreed
upon cash payment, which was funded today into trust for them, and
an interest in a litigation trust which will pursue certain
preference and other claims. Under the Plan and effective today,
all existing shares of stock of SLI, Inc. were cancelled and there
is no recovery for SLI's prepetition stockholders.

To further enhance the financial condition of reorganized SLI and
cover the costs to emerge from bankruptcy, holders of prepetition
secured claims purchased new equity in reorganized SLI in the
aggregate amount of approximately $26 million and advanced loans
to reorganized SLI's subsidiaries aggregating $20 million. The
membership interests in reorganized SLI issued under the Plan of
Reorganization are not expected to trade publicly.

SLI is a vertically integrated designer, manufacturer and seller
of lighting systems, which are comprised of lamps and fixtures.
The Company offers a complete range of lamps (incandescent,
fluorescent, compact fluorescent, high intensity discharge,
halogen, miniature incandescent, neon, LED and special lamps). The
Company also offers a comprehensive range of fixtures. The Company
serves a diverse international customer base and markets, has 35
plants in 11 countries and operates throughout the world. The
Company believes that it is also the #1 global supplier of
miniature lighting products for automotive instrumentation.

SLI and its U.S. subsidiaries filed voluntary petitions for
reorganization under Chapter 11 of the Bankruptcy Code in the U.S.
Bankruptcy Court for the District of Delaware on September 9,
2002. The joint Plan of Reorganization for SLI and its US
subsidiaries was confirmed by order of the Bankruptcy Court on
June 19, 2003.


SMTEK INT'L: Secures Conditional Nasdaq SmallCap Listing Status
---------------------------------------------------------------
SMTEK International, Inc. (Nasdaq:SMTI), a provider of electronics
manufacturing services, announced that its common stock will
continue to be listed on The Nasdaq SmallCap Market via an
exception from the minimum bid requirement and the shareholders'
equity requirement. Although as of June 27, 2003 SMTEK failed to
meet these requirements, as well as the market value of publicly
held shares requirement, SMTEK was granted a temporary exception
from these standards subject to it satisfying the following
conditions. The exception will expire if any of the conditions are
not met.

-- On or before July 8, 2003, SMTEK must file a proxy statement to
    seek shareholder approval for a reverse stock split sufficient
    to satisfy the $1.00 minimum bid price requirement;

-- On or before September 8, 2003, SMTEK must demonstrate a
    closing bid price of at least $1.00 per share; immediately
    thereafter, SMTEK must evidence a closing bid price of at least
    $1.00 per share for a minimum of ten consecutive trading days;

-- Also by September 8, 2003, SMTEK must make a public filing,
    which includes an unaudited balance sheet no older than 45
    days, evidencing shareholders' equity of at least $2.5 million;
    and

-- On or before September 30, 2003, SMTEK must file its Form 10-K
    for the fiscal year ended June 30, 2003.

If Nasdaq deems SMTEK to have met the terms of the exception, its
common stock will continue to be listed on The Nasdaq SmallCap
Market. SMTEK believes that it can meet these conditions, however,
there can be no assurance that it will do so. If at some future
date SMTEK's common stock should cease to be listed on The Nasdaq
SmallCap Market, its common stock may continue to be quoted in the
OTC Bulletin Board. On the open of business on July 3, 2003 and
for the duration of this exception, SMTEK's symbol will be
"SMTIC".

SMTEK also announced that its common stock is no longer listed on
the Pacific Exchange. The delisting of its common stock from the
Pacific Exchange became effective June 27, 2003.

Headquartered in Moorpark, California, SMTEK International, Inc.
is an electronics manufacturing services provider serving original
equipment manufacturers in the industrial instrumentation,
medical, telecommunications, security, financial services
automation, aerospace and defense industries. We provide
integrated solutions to original equipment manufacturers across
the entire product life cycle, from design to manufacturing to
end-of-life services, for the worldwide low to medium volume, high
complexity segment of the electronics manufacturing services
industry. We have five operating facilities with locations in
Moorpark, California; Santa Clara, California; Marlborough,
Massachusetts; Fort Lauderdale, Florida; and the Ayuttya Province
in Thailand.

                       *      *      *

               Liquidity and Capital Resources

In its Form 10-Q filed on February 10, 2003, the Company reported:

"Our primary sources of liquidity are our cash and cash
equivalents, which amounted to $628,000 at December 31, 2002,
and amounts available under our bank lines of credit, which
provided approximately $1.8 million of availability in excess of
current borrowings at December 31, 2002, after giving effect to
the amendment to the credit agreement. During the six months
ended December 31, 2002, cash and cash equivalents decreased by
$188,000.  This decrease resulted from purchases of equipment of
$907,000 and financing activities of $61,000, partially offset
by cash provided by operations of $815,000.

"Net cash provided by operating activities of $815,000 for the
six months ended December 31, 2002 was attributable primarily to
facility consolidation costs of $1.8 million, a decrease in
inventories of $1.2 million and an increase in accrued liabilities
of $1.8 million offset by our net loss before depreciation and
amortization of $3.8 million.

"Net cash used in investing activities was $907,000 for the six
months ended December 31, 2002 compared to $2.8 million for the
six months ended December 31, 2001.  The cash used was for the
purchase of capital expenditures mainly for production purposes.

"Net cash used in financing activities was $61,000 for the six
months ended December 31, 2002 compared to net cash provided by
financing activities of $1.6 million for the six months ended
December 31, 2001.  At December 31, 2002, we had approximately
$1.8 million available to borrow under our bank lines of credit,
after giving effect to the amendment to the credit agreement.

"At December 31, 2002, borrowings under our working capital
facility for our domestic operating units amounted to $5.2
million.  This credit facility is collateralized by accounts
receivable, inventory and equipment for our domestic operating
units and matures September 25, 2003.  At December 31, 2002, the
weighted average interest rate on the line of credit was 4.91%.
The line of credit agreement contains certain financial
covenants, with which we were not in compliance at December 31,
2002.  However, the terms of our line of credit have been
amended as of February 5, 2003.  Under the new terms, our line
of credit is at $8.5 million, bears interest at either the
bank's prime rate (4.25% at December 31, 2002) plus 1.00% or a
Eurodollar-base rate (1.37% at December 31, 2002) plus 3.75%,
and the covenants have been amended.  We are currently and
expect to be in compliance with the amended bank covenants.  Our
available borrowing capacity as of December 31, 2002, after
giving effect to the amendment, was approximately $1.8 million.

"In addition, during fiscal 2002 we borrowed $1.6 million on our
equipment line of credit to finance our capital expenditures.
This advance has a maturity date of October 24, 2006.  At
December 31, 2002, the balance outstanding was $945,000 and the
weighted average interest rate was 4.87%. Under the amended
credit facility terms, interest is at either the bank's prime
rate plus 1.00% or at a Eurodollar-base rate plus 3.75%.
Additional advances under our equipment line of credit will not
be available to us until a review by the bank at a future date.

"We also have a credit facility agreement with Ulster Bank
Markets for our Northern Ireland operating company.  This
agreement consists of an accounts receivable revolver, with
maximum borrowings equal to the lesser of 75% of eligible
receivables or 2,500,000 British pounds sterling (approximately
$4,025,000 at December 31, 2002), of which 500,000 British
pounds sterling (approximately $805,000 at December 31, 2002)
consists of an overdraft facility, and bears interest at the
bank's base rate (4.00% at December 31, 2002) plus 2.00%.  At
December 31, 2002, borrowings outstanding under this credit
facility amounted to approximately $2.9 million, of which
the overdraft facility was fully utilized, and there was nominal
available borrowing capacity.  The credit facility agreement
matures on November 30, 2003.

"We also have a mortgage note secured by real property at
Northern Ireland with an outstanding balance of $732,000 at
December 31, 2002.  At December 31, 2002, we were in arrears and
we are currently seeking to negotiate a payment plan.

"We anticipate that additional expenditures of as much as
$125,000 may be made during the remainder of fiscal 2003,
primarily to improve production efficiency at our subsidiaries.
A substantial portion of these capital expenditures is expected
to be financed by our line of credit or other notes/leases
payable.

"At December 31, 2002, the ratio of current assets to current
liabilities was 0.9 to 1.0 compared to 1.3 to 1.0 at June 30,
2002.  At December 31, 2002, we had $2.9 million of negative
working capital compared to $5.9 million of working capital at
June 30, 2002.  At December 31, 2002, we had long-term borrowings
of $4.6 million compared to $10.1 million at June 30, 2002.  The
decreases in the working capital and long-term debt is due to the
reclassification of our domestic line of credit of $5.2 million
from long-term debt to current liabilities as this matures in less
than 12 months.  In addition, contributing to the decrease in
working capital is an increase in lease reserves recognized in the
second quarter of 2003.

"We have experienced and may continue to experience an adverse
effect on our operating results and our financial condition,
especially if current economic conditions continue for an extended
period of time, despite our cost reduction measures and efficiency
improvements at our operating subsidiaries. We are focused on the
consolidation and streamlining of operations so as to reduce our
excess capacity to better match market conditions.  Recent actions
taken and strategies being pursued are as follows:

      -  Transitioning the San Diego facility and evaluating
         further opportunities of consolidation, transition or sale
         of other facilities.

      -  Continuing focus on cost reductions related to pertinent
         production levels and reductions in administrative costs.

      -  Focusing our marketing efforts in the solicitation of
         customers in nonecomically affected industries.

"We remain dependent on our lines of credit for operations and
growth. Our domestic line of credit agreement is set to mature
in September 2003.  We can provide no assurance that the
agreement will be renewed or that any renewal would occur on
commercially reasonable terms.  We may have to explore alternative
financing if the bank does not renew our line of credit.

"We may require additional financing to satisfy our debt
obligations. However, there can be no assurance that we will be
able to obtain additional debt or equity financing when needed,
or on acceptable terms.  Any additional debt or equity financing
may involve substantial dilution to our stockholders, restrictive
covenants or high interest costs.  The failure to raise needed
funds on sufficiently favorable terms could have a material
adverse effect on our business, operating results, and financial
condition.

"Although management believes our cash resources, cash from
operations and available borrowing capacity on our working
capital lines of credit are sufficient to fund operations, if we
cannot refinance the domestic line of credit upon its maturity
or find alternative financing/funding of this obligation, there
is no assurance that we will continue as a going concern."


SOURCINGLINK.NET: Auditors Express Going Concern Uncertainty
------------------------------------------------------------
SourcingLink provides comprehensive merchandise sourcing solutions
for the retail industry. Its Internet-based, hosted solutions for
the pre-order phase of business-to-business merchandise
procurement enable retailers to organize, automate and
significantly reduce the cost of their merchandise sourcing
activities by locating and connecting directly with their retail
merchandise suppliers around the globe. As opposed to traditional
enterprise resource planning providers who largely address the
post-order process, SourcingLink's solution is focused on the pre-
order merchandise procurement process of buyers and suppliers. To
date, much of the communications between retailers and merchandise
suppliers for pre-order merchandise procurement have largely been
carried out through paper-based systems, telephone calls, faxes,
courier services or travel and personal visits. This traditional
process is time consuming, labor intensive and results in low
productivity for both the retailer and merchandise supplier. The
Company's solution, branded MySourcingCenter, provides an online
location for search, display and comparison functions, and links
and manages the data and communications between retailers and
merchandise suppliers in industry-specific private environments,
organizing and automating sourcing, or pre-order merchandise
procurement activities, over the Internet.

SourcingLink.net has a history of losses and expects to incur
losses in the future.  It incurred net losses of $1,520,000 in
fiscal 2003 and $1,951,000 in fiscal 2002. As of March 31, 2003,
it had an accumulated deficit of approximately $24 million. The
Company will complete the services work on its three-year, $9
million contract with Carrefour in the first part of fiscal 2004,
and as of May 2003 it had received the final services payment
under the contract to reach the full $9 million amount due for
services rendered over the past three years and to be rendered
through the first part of fiscal 2004. This contract has generated
the majority of SourcingLink's revenue and cash flow in fiscal
years 2003, 2002 and 2001. In the third quarter of fiscal year
2003, in anticipation of a lower revenue base, the Company reduced
certain operating costs, primarily labor and related expenses.
While its cost base has been reduced, it still expects to incur
significant operating and product development expenses as the
Company continues to market its services and hosted solutions to
both existing and new customers. As a result, the Company expects
to incur losses in upcoming fiscal quarters.

SourcingLink has the right to call for the exercise of
approximately 605,000 warrants for the purchase of common stock
through September 2003, which would provide up to $325,000 of
equity capital. The Company believes that current cash balances,
together with cash flows from existing hosted solutions and
professional services agreements and callable common stock
warrants, will be sufficient to fund operations through at least
the next twelve months if anticipated new customer acquisitions
and the related cash flows occur in accordance with current plans.
However, in the event that its expectations of future operating
results are not achieved, or in the event that it is unable to
maintain its relationships with existing customers, or if the
timing of acquiring new customers and cash receipts from any such
customer is delayed, then SourcingLink would likely be required to
raise additional capital through the sale of equity and/or debt to
sustain  operations or to reduce expenditures significantly to
enable current cash reserves to fund operations for at least the
next twelve months and beyond.   There is no assurance that the
Company will retain its existing customers or obtain additional
customers, or that if additional customers are obtained they will
generate cash receipts for the Company within the needed time
frame, or that equity or debt financing, if required within or
beyond the next twelve months, will be available on acceptable
terms, or at all.   In their audit report, SourcingLink's
independent auditors expressed substantial doubt about the
Company's ability to continue as a going concern.


SPIEGEL GROUP: Court Okays Chadbourne as Committee's Counsel
------------------------------------------------------------
The Official Committee of Unsecured Creditors of Spiegel Debtors
obtained permission from the Court to retain Chadbourne & Parke
LLP to represent it in the Spiegel Debtors' proceedings, effective
as of March 24, 2003.

As counsel, Chadbourne & Parke will:

   -- advise the Committee with respect to its rights, duties and
      powers in these cases;

   -- consult with the Debtors, their counsel, other
      professionals retained in these cases and the U.S. Trustee
      concerning the administration of the cases and their impact
      on the estates;

   -- assist and advise the Committee in analyzing the claims of
      creditors and in negotiating with the creditors;

   -- assist and advise in the Committee's investigation of the
      acts, conduct, assets, liabilities, and financial condition
      of the Debtors, the operation of the Debtors' businesses,
      and any other matters relevant to these cases or to the
      formulation of a plan of reorganization or liquidation,
      including considering the appointment of a trustee or
      examiner, as appropriate;

   -- assist and advise the Committee in its analysis of, and
      negotiations with, the Debtors and any third parties, in
      the formulation of any liquidation or reorganization plan;

   -- assist and advise the Committee with respect to its
      communications with the general creditor body regarding
      significant matters in the Debtors' cases;

   -- prepare pleadings, motions, applications, objections and
      other papers as may be necessary in furtherance of the
      Committee's interests and objectives;

   -- analyze and advise the Committee of the meaning and import
      of all pleadings and other documents filed with the Court;

   -- represent the Committee at all hearings and other
      proceedings; and

   -- perform other legal services as may be required and are
      deemed to be in the interest of the Committee and unsecured
      creditors in accordance with those powers and duties
      pursuant to the Bankruptcy Code.

For its services, Chadbourne & Parke will be compensated on an
hourly basis, plus reimbursement of its actual and necessary
expenses.  Chadbourne & Parke's attorneys and paralegals
responsible for representing the Committee and their current
hourly rates are:

           Attorney/Paralegal      Position       Rate
           ------------------      --------       ----
           Howard Seife            Partner        $720
           David M. LeMay          Partner         620
           Douglas E. Deutsch      Associate       375
           All other Partners                   425 - 720
           Counsel                              450 - 530
           All other Associates                 250 - 425
           Paralegals                           125 - 195
(Spiegel Bankruptcy News, Issue No. 7; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


STROUDS ACQUISITION: Makes Full Payment on Fog Cutter Cap. Loans
----------------------------------------------------------------
Fog Cutter Capital Group Inc. (Nasdaq:FCCG) has received payment
in full on its loans to Strouds Acquisition Corporation, which
filed for Chapter 11 bankruptcy protection on May 20, 2003.

Fog Cutter's financing package for Strouds included a $2.0 million
loan participation in Fleet Retail Finance Inc.'s senior secured
credit facility and a $900,000 subordinated secured loan.

Fog Cutter Capital Group Inc. focuses on investing, structuring
and managing a wide range of financial assets, including the
acquisition of debt or equity positions in companies requiring
assistance in restructuring their operations; investments in
mortgage-backed securities and other real estate related assets;
provision of corporate mezzanine financing and other similar
investments. The Company invests where its expertise in intensive
asset management, credit analysis and financial structuring can
create value and provide an appropriate risk-adjusted rate of
return. The Company maintains a flexible approach with respect to
the nature of its investments, seeking to take advantage of
opportunities as they arise or are developed.


TELENETICS: Inks Settlement Pact & Mutual Release with Comtel
-------------------------------------------------------------
On June 20, 2003, Telenetics Corporation entered into a Settlement
Agreement and Mutual Release, effective June 6, 2003, with Comtel
Electronics, Inc. dba Corlund Electronics - Tustin and Corlund
Electronics Corporation dba Corlund Electronics - Camarillo. Under
the agreement, the Company paid $500,000 to Corlund on June 20,
2003, with $250,000 due on or before July 21, 2003 and $250,000
due on or before August 20, 2003. There is a 7 day grace period
for such payments to be deemed timely. On or before November 13,
2003, the Company shall pay to Corlund an additional sum based on
a reconciliation of accounts receivable amounts received by both
parties not to exceed $912,335.

As part of the agreement, the Company has stipulated to a judgment
in the amount of $5.2 million which has been deemed satisfied by
one-third upon the payment of $500,000 at close, and shall be
deemed satisfied by one-sixth for each of the $250,000 payments
and one-third for the final payment. The Company has recognized an
immediate benefit from the settlement aggregating $1.4 million
which represents the first one-third of the satisfaction of
judgment and the difference between the carrying value of the net
liability owed to Corlund and the stipulated judgment. The
remaining balance of $2.2 million has been recorded as a deferred
gain on settlement that will be recognized as the remaining
payments are made.

The benefit of the settlement will be allocated first to the
overpricing of inventory purchased from Corlund, second to the
overpricing of raw materials returned to the Company from Corlund
and the remaining balance will be recorded as gain on debt
extinguishment.

Based in Lake Forest, Telenetics designs, manufactures and
distributes wired and wireless data communications products for
customers worldwide. Telenetics offers a wide range of industrial
grade modems and wireless products, systems and services for
connecting its customers to end-point devices such as meters,
remote terminal units, traffic and industrial controllers and
remote sensors.

Telenetics also provides high-speed communications products for
complex data networks used by financial institutions, air traffic
control systems and public and private wireless network operators.
Additional information is available at http://www.telenetics.com

As reported in Troubled Company Reporter's April 23, 2003 edition,
the Company's auditors Haskell & White LLP stated in its report
for the period December 31, 2002: "The [Company's] consolidated
financial statements have been prepared assuming that the Company
will continue as a going concern...[T]he Company has suffered
recurring losses from operations, has used cash in operations on a
recurring basis, has an accumulated deficit, and is involved in a
dispute with a significant contract manufacturer that, among other
things, raise substantial doubt about its ability to continue as a
going concern. Management's plans in regard to these matters. The
consolidated financial statements do not include any adjustments
that might result from the outcome of this uncertainty."


TENERA INC: Unit Transferring Contracted Work to S.M. Stoller
-------------------------------------------------------------
As previously announced, TENERA, Inc. (AMEX:TNR) has undertaken
efforts to either sell or dispose of its operating segments as
quickly as possible this year or permit its operating units to
dispose of their assets. The Company then reported the
dispositions of the operating assets by two of its operating
subsidiaries, TENERA Energy, LLC, and GoTrain Corp, and that it
was reviewing various disposition alternatives involving its last
remaining subsidiary, TENERA Rocky Flats, LLC. In furtherance of
this program, the Company announced that TENERA Rocky Flats, LLC
approved Tuesday the transfer (in exchange for a small amount of
cash, assumption of certain of the joint venture management
responsibilities and recruitment of remaining key personnel) of
TENERA Rocky Flats, LLC's remaining contracted work scopes for the
Department of Energy sites to The S.M. Stoller Corporation, a
Colorado corporation and one of the Company's joint-venture
partners for the Rocky Flats Site contract.

Management continues to anticipate that the cash resources of the
Company and its subsidiaries, although increased by the net
proceeds of these sales, will be substantially used to fund
acquisition escrow requirements and complete course work
obligations associated with the GoTrain Corp. sale, retire the
Company's and Go-Train's indebtedness, applied toward the
obligations of the Company's other creditors, and offset costs
associated with the disposition plan underway. The Company
presently is examining the best alternatives for any available
cash after all of its present and future obligations are
determined, including a wind-down of its operations. However, we
cannot predict the amount of cash, if any, that will be available
for distribution to TENERA's shareholders should a wind-down be
effected.

Also previously announced, the American Stock Exchange had
notified the Company that it does not meet certain of the
Exchange's continued listing standards. The Company has now
submitted a response acknowledging the notification and that it is
conducting a review of the alternatives available to the Company.
There can be no assurance however that the Company will be able to
present a plan that will meet the continued AMEX listing
standards, or if it does not, will be able to provide an
alterative market for its outstanding shares.

TENERA, Inc.'s March 31, 2003 balance sheet shows a working
capital deficit of close to $3 million, and a total shareholders'
equity deficit of about $2 million.


TEREX: Enters Pact with Caterpillar to Realign Mining Businesses
----------------------------------------------------------------
Terex Corporation (NYSE: TEX), along with announcing that it has
entered into an agreement in principle with Caterpillar, Inc.
(NYSE: CAT) to realign its mining truck and mining shovel
businesses, is also providing an update with respect to recent
operating activities and the current business environment for its
products. Complete details will be available and discussed during
the Company's second quarter 2003 conference call, which is
scheduled for July 24th at 8:30 a.m., Eastern Time.

During the second quarter of 2003, the Company continued, extended
and initiated numerous restructuring activities due to the near
term business outlook of several of its operations. These
activities included a further product and inventory
rationalization in its Roadbuilding group and plant capacity
reduction in its tower crane business. The objective of these
actions is to size the operations based on current end market
demand for their products, while increasing productivity,
optimizing manufacturing efficiency and improving returns. The
majority of these initiatives are either in reaction to depressed
end markets, such as the product and inventory rationalization in
the Roadbuilding group, or increasing efficiency by leveraging the
manufacturing capacity within the Company.

The Company also accelerated its review of goodwill at its
Roadbuilding reporting unit, which will result in a non-cash
charge in the second quarter of 2003. Given the continued
uncertainty of the business performance within that group, which
depends directly on government funding for various projects both
at the state and federal level, the Company previously indicated
that it would perform the analysis at this time, rather than wait
for the review scheduled for the fourth quarter of 2003.

"We expect the charge for goodwill impairment, restructuring and
other special items to be in the range of $90 - $95 million, pre-
tax," commented Phil Widman, Senior Vice President and Chief
Financial Officer. "The cash component of the charge is expected
to be approximately $10 million, as the majority of the charge is
related to goodwill impairment."

"Terex continues its internal focus on operations as we near
completion of a multi-year effort to lower our structural cost,"
commented Ronald M. DeFeo, Terex Chairman and Chief Executive
Officer. "Over the past three years, we have consolidated over 20
manufacturing facilities, which is quite remarkable, and which
will have a meaningful positive benefit for the Company when the
end markets recover. We are also focused on improving the customer
value proposition we offer in order to leverage the Terex product
breadth."

Mr. DeFeo added, "We expect earnings per share for the second
quarter of 2003 to fall short of current market expectations. We
are looking at a performance similar to last year on an earnings
per share basis, excluding special items. Performance weakness is
primarily coming from the Roadbuilding and North American crane
businesses, which appear to have not met our lower expectations.
We still believe that we will be within the previously announced
full year guidance, but perhaps at the lower end of the range."

Mr. DeFeo concluded by adding, "We have made substantial progress
on many fronts despite the current environment. We remain
committed to paying down $200 million in debt during 2003 and have
recently completed the redemption of $50 million of our 8-7/8%
Senior Subordinated Notes. At this point in time, we wanted
investors to have the most complete picture of both short and
longer term issues and opportunities at Terex, given the
significant changes going on at the Company. We will be fully
prepared to discuss details on our July 24th call."

Terex Corporation is a diversified global manufacturer based in
Westport, Connecticut, with 2002 revenues of $2.8 billion. Terex
is involved in a broad range of construction, infrastructure,
recycling and mining-related capital equipment under the brand
names of Advance, American, Amida, Atlas, Bartell, Bendini,
Benford, Bid-Well, B.L. Pegson, Canica, Cedarapids, Cifali, CMI,
Coleman Engineering, Comedil, CPV, Demag, Fermec, Finlay, Franna,
Fuchs, Genie, Grayhound, Hi-Ranger, Italmacchine, Jaques, Johnson-
Ross, Koehring, Lectra Haul, Load King, Lorain, Marklift, Matbro,
Morrison, Muller, O&K, Payhauler, Peiner, Powerscreen, PPM, Re-
Tech, RO, Royer, Schaeff, Simplicity, Square Shooter, Telelect,
Terex, and Unit Rig. Terex offers a complete line of financial
products and services to assist in the acquisition of Terex
equipment through Terex Financial Services. More information on
Terex can be found at http://www.terex.com

                         *     *     *

As previously reported in the Troubled Company Reporter, Standard
& Poor's assigned its double-'B'-minus secured bank loan rating to
Terex Corp.'s proposed $210 million new term loan C maturing in
December 2009. In addition, the double-'B'-minus corporate credit
rating was affirmed on Westport, Connecticut-based Terex, a
manufacturer of construction and mining equipment. Total rated
debt is $1.6 billion. The outlook is stable.

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


TEXAS DEPARTMENT OF HOUSING: S&P Downgrades Bond Ratings to B/CC
----------------------------------------------------------------
Standard & Poor's Ratings Services lowered its rating on Texas
Department of Housing and Community Affairs' housing revenue bonds
(Dallas/Fort Worth Apartments Pool project) senior series 1996A to
'B' from 'BB' and subordinate series 1996C to 'CC' from 'CCC',
reflecting continuing draws on the debt service reserve funds and
high vacancy rates. The outlook is negative.

The series 1996D bonds were downgraded to 'D' on Jan. 2, 2003,
following the default in debt service payment due on Jan. 1, 2003.
Likewise, debt service due on July 1, 2003, will not be paid.
Prior rating downgrades to each series of bonds have been done
during the past two years for the default and debt service reserve
fund draws. These have occurred because the owner withheld rental
payments rather than transferring such revenues to the trustee as
required. Instead, the funds have been used for property repair
and maintenance because of ongoing insufficient funds available in
the replacement reserve fund to make needed repairs.

Despite the default and debt service reserve fund draws, debt
service coverage levels for the fiscal year ended Dec. 31, 2002,
rose to 1.51x on the senior debt (series 1996A) and 1.40x on the
series 1996C debt from 1.40x and 1.29x, respectively, for the
period ending fiscal 2001. Debt service coverage through May 31,
2003, is about the same level it was in fiscal 2002 at 1.50x on
the senior bonds and 1.39x on the series 1996C bonds; however,
these levels will be difficult to maintain given increasing
vacancy rates.

The current vacancy level for all properties in the pool is 12.6%.
This has increased from 10.9% in May 2003 and 8.2% in Jan. 2003.
According to REIS, the Dallas multifamily market reached its
highest vacancy rate since 1989 at 9.4% in the first quarter of
2003.

Following the debt service payment on Jan. 1, 2003, the owner
again began to withhold rent revenues from the trustee to allow
for the payment of debt service on the bonds on July 1, 2003, thus
resulting in the required draws to the reserve funds. The owner
resumed sending rental revenues to the trustee in April 2003 and
is continuing to do so currently according to the trustee.
However, due to the various draws, debt service reserve funds are
currently not fully funded and it is uncertain whether they will
become fully funded before the next interest payment date on
Jan. 1, 2004.


THANE INT'L: Obtains Waiver of Default Under Credit Facility
------------------------------------------------------------
Thane International, Inc. (OTC Bulletin Board: THAN) announced
preliminary financial results for the fiscal year ended March 31,
2003. Total revenues for the year were $159.2 million,
representing a 31.2% decrease over total revenues of $231.5
million in 2002. Net loss in 2003 was $32.9 million, compared to
net income of $9.9 million for the year ended March 31, 2002.

In the quarter ended March 31, 2003, the preliminary operating
results of Thane included a non-cash write-off of $21.8 million
related to the impairment of goodwill allocated to the acquisition
of Krane Holdings, Inc., in March 2002. As of June 30, 2003, the
preliminary operating results of Thane do not include a potential
non-cash write-off related to the impairment of goodwill allocated
to the acquisition of Reliant Interactive Media Corp. in May 2003.
The total balance of goodwill allocated to the acquisition of
Reliant at March 31, 2003 was $4.1 million.

As of December 31, 2002, Krane was in default of its credit
facility with LaSalle Bank National Association due to violations
of certain debt covenants. In addition, this credit facility
matured in February 2003. The Company was unable to negotiate a
waiver for these violations or a short-term extension of this
facility. As a result, on June 18, 2003, LaSalle exercised their
secured rights under this facility, and accordingly, took
possession of 100% of the capital stock of Krane. Therefore, as of
March 31, 2003, Thane recognized a non-cash write-off of 100% of
the goodwill associated with the Krane acquisition, or $21.8
million. In conjunction with the Krane acquisition, Thane's
current lenders entered into an intercreditor agreement with
LaSalle whereby they agreed that there would be no cross default
between the credit facilities of Krane and Thane. Accordingly, the
aforementioned events did not result in a default under Thane's
existing credit facility.

At March 31, 2003, Thane was in default of its existing credit
facility due to violations of certain debt covenants. On June 26,
2003, Thane obtained a waiver from its lenders with respect to
this default and amended the financial covenants of the existing
agreement.

Due to the accounting and disclosure issues related to the items
discussed above, Thane has filed a notification of late filing
with the Securities and Exchange Commission with respect to
Thane's Form 10-K for the year ended March 31, 2003. Thane
anticipates that this Form 10-K will be filed no later than July
15, 2003.

As previously reported, in the quarter ended December 31, 2002,
Thane took a total write-off of $8.2 million. The write-off
primarily consisted of product financing receivables, inventory,
prepaid royalties and production costs related to products that we
are no longer able to sell in our channels of distribution, in the
amount of $6.2 million. In addition, the total write- off amount
includes a charge of $1.4 million related to a settlement with the
Canadian government regarding a health and beauty product sold in
Canada for which the Company was required to refund monies to
customers who returned the product. The total charge of $8.2
million, for the third quarter ended December 31, 2002, reduced
total revenues by $2.2 million, increased cost of sales, including
selling expenses by $5.8 million and increased general and
administrative expenses and other expenses by $30,000 and $129,000
respectively.

All comparisons to prior periods below are based on historical
amounts for the years ended March 31, 2003 and March 31, 2002 and,
accordingly, include the write-offs discussed above.

Thane is a global leader in the multi-channel direct marketing of
consumer products in the fitness, health and beauty and housewares
product categories. Thane's distribution channels in the United
States, and through its 186 international distributors and
strategic partners, in 80 countries around the world, include
direct response TV, home shopping channels, catalogs, retail,
telemarketing, print advertising, credit card inserts and the
Internet. Thane develops and acquires products, arranges low-cost
manufacturing (primarily offshore), and then markets and
distributes its products through its various distribution
channels. Thane believes its management of each facet of this
process enables it to maximize the return on investment on its
products and create profitable products for target markets. Visit
the Company's Web site at http://www.thaneinc.comfor more
information.


TOUCH AMERICA: Gets OK to Appoint BMC as Notice and Claims Agent
----------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware gave its
nod of approval to Touch America Holdings, Inc., and its debtor-
affiliates' request to employ the services of Bankruptcy
Management Corporation as notice, claims and balloting agent.

As claims, notice and balloting agent, the Debtors expect BMC to:

      a. prepare and serve required notices in these chapter 11
         cases, which may include:

           i. notice of the commencement of these chapter 11
              cases and the initial meeting of creditors pursuant
              to Section 341(a);

          ii. notice of the claims bar date, if any;

         iii. notice of objections to claims, if any;

          iv. notice of any hearings on a disclosure statement
              and confirmation of a plan of reorganization or
              liquidation; and

           v. other miscellaneous notices to any entities as
              Touch America or the Court may deem necessary or
              appropriate for an orderly administration of these
              chapter 11 cases;

      b. after the mailing of a particular notice, file with the
         Clerk's Office a certificate or affidavit of service
         that includes a copy of the notice involved, an
         alphabetical list of persons to whom the notice was
         mailed, and the date and manner of mailing;

      c. receive and record proofs of claim and proofs of
         interest filed;

      d. create and maintain official claims registers,
         including, among other things, the following information
         for each proof of claim or proof of interest:

           i. the applicable Debtor;

          ii. the name and address of the claimant and any agent
              thereof, if the proof of claim or proof of interest
              was filed by an agent;

         iii. the date received;

          iv. the claim number assigned;

           v. the asserted amount and classification of the
              claim; and

          vi. status of claims or interest;

      e. implement necessary security measures to ensure the
         completeness and integrity of the claims register;

      f. transmit to the Clerk's Office a copy of the claims
         register upon request and at agreed upon intervals;

      g. maintain an up-to-date mailing list for all entities
         that have filed a proof of claim or proof of interest,
         which list shall be available upon request of a party in
         interest or, the Clerk's Office;

      h. provide access to the public for examination of copies
         of the proofs of claim or interest without charge during
         regular business hours;

      i. record all transfers of claims pursuant to Federal Rule
         of Bankruptcy Procedure 30010(e) and provide notice of
         such transfers as required by Federal Rule of Bankruptcy
         Procedure 3001(c);

      j. act as balloting agent, which will include, without
         limitation, the following services:

           i. print ballots including the printing of creditor
              and shareholder specific ballots;

          ii. prepare voting reports by plan class, creditor or
              shareholder and amount for review and approval by
              the Debtors and their counsel;

         iii. coordinate mailing of ballots, disclosure
              statement, and any plan of reorganization or
              liquidation or other appropriate materials to all
              voting and nonvoting parties and provide affidavit
              of service;

          iv. establish a toll-free number to receive questions
              regarding voting on the plan; and

           v. receive and record ballots, inspect ballots for
              conformity to voting procedures, date stamp and
              number ballots consecutively, and certify the
              voting results;

      k. comply with applicable federal, state, municipal, and
         local statutes, ordinances, rules, regulations, orders,
         and other requirements;

      l. provide temporary employees to process claims, as
         necessary;

      m. promptly comply with such further conditions and
         requirements as the Clerk's Office or the Court may at
         any time order; and

      n. perform such other administrative, technical, and
         support services related to the noticing, claims,
         docketing, solicitation, and distribution as Touch
         America or the Clerk's Office may request.

Sean Allen, President of BMC assures the Court that BMC is a
"disinterested person" as that term is defined in the Bankruptcy
Code.  As exchange for BMC's services, it will bill the Debtors
its current hourly rates:

           Principals               $200 to $275 per hour
           Consultants              $ 95 to $200 per hour
           Case Support             $ 75 to $150 per hour
           Technology Services      $125 to $175 per hour
           Information services     $ 40 to $ 75 per hour

Touch America Holdings, Inc., headquartered in Butte, Montana,
filed for chapter 11 protection on June 19, 2003 (Bankr. Del. Case
No. 03-11915).  Touch America, through its principal operating
subsidiary, Touch America, Inc., develops, owns, and operates data
transport and Internet services to commercial customers. Maureen
D. Luke, Esq., and Robert S. Brady, Esq., at Young Conaway
Stargatt & Taylor, LLP represent the Debtors in their
restructuring efforts.  When the Company filed for protection from
its creditors, it listed $631,408,000 in total assets and
$554,200,000 in total debts.


UNITED AIRLINES: Wells Fargo Demands $3MM+ Admin Expense Payment
----------------------------------------------------------------
Wells Fargo is successor to First Security Bank as Indenture
Trustee and Pass-Through Trustee for the 1995A Trusts.  Each
1995A Trusts issued trust certificates to investors, with the
proceeds used to purchase equipment notes.  Wilmington Trust
Company, as Owner Trustee, owns the Aircraft and is the direct
obligor on the Equipment Notes.  Wilmington services the
Equipment Notes debt by leasing the Aircraft to United Airlines.
The Equipment Notes are secured by the Aircraft and the Owner
Trustee has assigned the Leases to the Indenture Trustee as
additional security.

United is required to cure all defaults and perform obligations
for the subject Aircraft, which are held under the 1995-A1 and
1995-A2 Pass-Through Trust Certificates.  As a consequence of
their Section 1110 Election, the Debtors were required to make
scheduled payments to the Trustee for use of the Aircraft.
However, the latest payment has not arrived.  The Debtors
currently owe $3,456,295.

           Tail No.      Date Due        Amount
           --------      --------        ------
           N189UA        4/19/03         $2,030,785
           N777UA        4/19/03            712,810
           N766UA        4/19/03            712,700

Thus, Wells Fargo asks Judge Wedoff to compel the Debtors to
immediately make the 1110 Payments, together with interest
accrued on missed payments and the resulting fees and expenses,
as an administrative expense of their estates. (United Airlines
Bankruptcy News, Issue No. 21; Bankruptcy Creditors' Service,
Inc., 609/392-0900)


US AIRWAYS: Reaches Agreement to Extend Stock Distribution Date
---------------------------------------------------------------
US Airways Group, Inc. and its unions have reached an agreement to
delay until July 31, 2003, the vesting of the first 25 percent of
restricted stock to be distributed to union members for their
participation in the company's restructuring plan.

In addition, the company will accelerate the vesting schedule so
that the second 25 percent of the restricted stock, which would
have vested on Jan. 1, 2004, now will vest at the same time as the
first allocation. "While our flexibility is limited to reward our
employees during these difficult times, this acceleration is a
step the company can take in recognition of the continuing
sacrifices being made by our employees," said US Airways President
and Chief Executive Officer David N. Siegel.


U.S. STEEL: Completes Sale of Mining Company Assets for $50 Mil.
----------------------------------------------------------------
United States Steel Corporation (NYSE: X) has completed the sale
of the mines and related assets of U. S. Steel Mining Company, LLC
to a newly formed company, PinnOak Resources, LLC.

The new company has acquired the coal and related assets
associated with USM's Pinnacle No. 50 mine complex located near
Pineville, W.Va., and USM's Oak Grove mine complex located near
Birmingham, Ala.

The transaction price included $50 million at the time of closing
plus a future amount to be determined based on final inventories.
U. S. Steel will record the results of this sale in the second
quarter.

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

                         *   *   *

As reported in Troubled Company Reporter's May 9, 2003 edition,
Standard & Poor's Ratings Services lowered its corporate credit
rating on integrated steel producer United States Steel Corp. to
'BB-' from 'BB' based on concerns about the firm's increased
financial risk.

Standard & Poor's said that it has removed its ratings on
Pittsburgh, Pennsylvania-based United States Steel from
CreditWatch, where they were placed with negative implications on
Jan. 9, 2003. The current outlook is negative. The company had
about $1.7 billion in lease-adjusted debt at March 31, 2003.

At the same time, Standard & Poor's said it has assigned its 'BB-'
rating to United States Steel Corp.'s proposed $350 million senior
notes due 2010.


VELTRI METAL: Extends Senior Credit & Tooling Credit Facilities
---------------------------------------------------------------
Automotive parts supplier, Veltri Metal Products, Inc., announced
a net loss of $2.0 million, after taking into consideration a $2.0
million charge for the closing costs of its J&R Manufacturing
division, in the first quarter ended April 5, 2003, compared with
net income of $1.6 million for the year-earlier quarter. Net sales
for the first quarter were $68.3 million compared to $69.2 million
in the year- earlier quarter. Higher interest charges ($0.4
million) and a higher effective income-tax rate ($0.6 million
effect) adversely impacted the year- over-year earnings
comparison.

The Company's earnings before interest, taxes, depreciation and
amortization (EBITDA) in the first quarter were $5.9 million,
compared to $6.4 million during the year-earlier period.

The Company previously announced, in early March 2003, the closure
of its J&R Manufacturing division, which produced prototype and
low-volume production stampings. In connection with the closure,
in the first quarter, the Company recorded a $2.0 million pre-tax
charge for the estimated costs to close this division. Operations
at J&R Manufacturing ceased on May 9, 2003.

Outstanding indebtedness, net of cash, at the end of the first
quarter was $69 million, compared to $76 million at the end of the
year-earlier quarter.

Michael Veltri, President and CEO stated, "We are pleased that we
were able to maintain a solid EBITDA level in the first quarter,
despite slightly lower sales and higher losses at J&R prior to its
shut-down. This is indicative of the operating improvements and
focus on continuous improvements that we have undertaken in the 18
months since our emergence from bankruptcy. We are disappointed
that we were unable to turn around the losses at J&R
Manufacturing, but the prototype market continues to be very soft.
Fortunately, we do not expect this closure to affect our core
business of high-volume, production stampings and assemblies."

In addition, the Company announced the successful extension of its
senior credit facility led by Comerica Bank, as agent, and the
closing on a new credit facility with Export Development Canada
that provides financing of the acquisition of tooling required to
fulfill contracts with vehicle manufacturings. Mr. Veltri said
that, "These facilities will enhance our ability to fund our
operations along with the capital and tooling requirements of the
programs set to launch in early 2004."

Mr. Veltri further stated, "Looking ahead, the rest of 2003 will
be challenging for the Company and for the entire industry. Strong
sales continue into the second quarter ahead of plan but a
downward trend is expected due to the extended model changeover at
the DaimlerChrysler Brampton, Ontario plant from the 'LH' to the
'LX' platform scheduled for the second half of 2003. Also the
second half will be affected by the balance out of the
DaimlerChrysler 'AB' van at the Windsor Assembly plant, resulting
in underutilized plant capacity during this period. Earnings may
be impacted in the second half of the year due to pressure on the
Company from the vehicle manufacturers' continued emphasis on
cost-downs coupled with the potential for labor disruption at the
vehicle manufacturers in September tied to labor contract talks.
These factors are amplified by the capital-intensive nature of the
metal stamping sector. On a more positive side, the Company was
successful in refinancing its debt, in a very tight capital market
due to support of its current bank group. It also continues to
progress favorably and to budget on several key new launches,
including the DaimlerChrysler 'LX' platform, as well as others. We
continue to see strength in key platform sales for our
DaimlerChrysler Pacifica, Jeep Liberty, General Motors GMT 800 and
Honda Accord, Element and Civic product and are very excited about
the launch of our new Lakeshore, Ontario facility set to open
early 2004."

Veltri Metal Products, Inc. is a leading full-service Tier One
designer and manufacturer of high quality, stamped metal
components and complex assemblies used by North American
automotive vehicle manufacturers including DaimlerChrysler,
General Motors Corporation, Honda Motors Co., Ltd., Ford Motor
Company and other Tier One suppliers. The Company specializes in
underbody/chassis and unexposed body structure assemblies for
passenger cars, light trucks and full-size vans. Veltri's products
include frame rail assemblies, inner quarter panels, rear ladder
modules, cross member assemblies and trailer hitch assemblies. The
Company and its management team are highly respected within the
automotive industry for their expertise in supplying multi-
component, complex stamping assemblies, an outstanding new program
launch record and strong customer and employee relationships. The
Company employs over 1,600 people at seven manufacturing
facilities in the United States and Canada and is headquartered in
Troy, Michigan.


VENTAS: Completes Sale of Skilled Nursing Facilities to Kindred
---------------------------------------------------------------
Ventas, Inc. (NYSE:VTR) has completed the previously announced
sale of 16 skilled nursing facilities in Florida and Texas to its
primary tenant, Kindred Healthcare, Inc. (Nasdaq:KIND), which had
been leasing those properties from Ventas.

"The successful completion of this transaction benefits both
Ventas and Kindred by enabling them to exit the skilled nursing
facility market in Florida in a mutually beneficial and
cooperative manner," Ventas Chairman, President and CEO Debra A.
Cafaro said. "We are delighted with the outcome of this matter."

Under terms of the transaction, Kindred purchased the 16 skilled
nursing facilities, including 15 properties in Florida and one
property in Texas, for $59.7 million in cash proceeds. In
addition, Kindred paid the Company a $4.1 million lease
termination fee. Ventas used the net proceeds to repay in full all
unpaid amounts under the Company's settlement agreement with the
Department of Justice. The remaining net proceeds were used to
reduce the Company's debt balances.

The Company expects its 2003 second quarter Funds From Operations
to increase from the transaction by $4.8 million of additional
revenue. This increase in FFO will be offset by a $2.7 million
expense relating to the early repayment of the United States
Settlement that will be reflected as the United States Settlement
interest expense on the Company's 2003 second quarter statement of
operations. As required by accounting principles generally
accepted in the United States, the United States Settlement has
been, since inception, reported on the Company's balance sheet at
an amount that is less than the actual unpaid principal amount
under the United States Settlement because the 6% interest rate
payable was deemed "below market" at the time of the settlement.
The $2.7 million interest expense reflects the difference between
the total amount paid by the Company in final repayment of the
United States Settlement and the amount of the United States
Settlement reflected on the Company's balance sheet on the date of
final repayment. The early repayment of the United States
Settlement is expected to result in total interest savings to the
Company of $2.0 million in the third and fourth quarters of 2003,
and total increased cash flow during these quarters of $8.0
million.

The transactions are expected to have a total net positive impact
on second quarter FFO of approximately $2.1 million (the $4.8
million additional revenue offset by the $2.7 million United
States Settlement interest expense) or $0.03 per diluted share.
Second quarter normalized FFO is expected to be approximately
$0.38 to $0.39 per diluted share.

Ventas will record a book loss of approximately $5.0 million in
its full year 2003 earnings as a result of the sale of the 16
properties to Kindred. This loss will have no impact on second
quarter or full year 2003 FFO in accordance with the NAREIT
definition of FFO.

Under a separate agreement that also closed Tuesday, Ventas and
Kindred amended the Master Leases between the two companies to
increase rent on certain facilities under those Master Leases by
$8.6 million per year on an annualized basis (May 1, 2003-April
30, 2004), for approximately seven years. This amount will
escalate 3.5% annually in accordance with the Master Leases. In
addition, the Master Leases were amended to: (1) provide that all
annual escalators under the Master Leases will be in cash at all
times and (2) expand certain cooperation and information sharing
provisions of the Master Leases.

                2003 NORMALIZED FFO GUIDANCE RAISED;
              2004 NORMALIZED FFO GUIDANCE REAFFIRMED

Ventas expects its 2003 normalized FFO to increase to between
$1.50 and $1.52 per diluted share, up from its previous guidance
of $1.48-$1.50. The increase is due to the Company's decision
regarding its use of proceeds from the Florida and Texas property
disposition and its expectation that general and administrative
expenses should stabilize through the third and fourth quarters of
2003. The Company also reaffirmed that it expects 2004 normalized
FFO to be between $1.55 and $1.57 per diluted share.

The Company's FFO guidance (and related GAAP earnings projections)
for 2003 and 2004 exclude gains and losses on the sale of assets,
the non-cash effect of swap ineffectiveness under SFAS 133 and the
impact of acquisitions, additional divestitures and other capital
transactions. Reconciliation of the FFO guidance to the Company's
projected GAAP earnings is provided on a schedule at the
conclusion of this press release. The Company may from time to
time update its publicly announced FFO guidance, but it is not
obligated to do so.

The Company's FFO guidance is based on a number of assumptions,
which are subject to change and many of which are outside the
control of the Company. If any of these assumptions vary, the
Company's results may change. There can be no assurance that the
Company will achieve these results.

Ventas, Inc., is a healthcare real estate investment trust that
owns 44 hospitals, 204 nursing facilities and nine other
healthcare and senior housing facilities in 37 states. The Company
also has investments in 25 additional healthcare and senior
housing facilities. More information about Ventas can be found on
its Web site at http://www.ventasreit.com

As previously reported, Standard & Poor's affirmed Ventas Inc.'s
corporate credit ratings at BB-. At March 31, 2003, the Company's
balance sheet shows a total shareholders' equity deficit of about
$43 million.


WACKENHUT CORRECTIONS: Names Norman Cox VP Business Development
---------------------------------------------------------------
Wackenhut Corrections Corporation (NYSE: WHC) has appointed
Mr. Norman Cox, Jr. to the position of Vice President of Business
Development, to be effective on July 1, 2003.

George C. Zoley, Chairman of the Board and Chief Executive Officer
of WCC said: "We are very fortunate to have Mr. Cox join our
Management Team. Mr. Cox's background and experience give him
outstanding qualifications to lead our Business Development Team.
We welcome him to our company with the utmost confidence that he
will represent WCC's interests with unparalleled professionalism
and integrity."

Mr. Cox brings 36 years of experience to WCC that covers a wide
range of disciplines: four years of experience in the US Army,
Military Intelligence Branch; 10 years of operational experience
with government at the state and local levels including three
years as an instructor at a major university; nine years directing
his own management consulting company; and 13 years as a senior
executive and consultant in the private corrections industry. Mr.
Cox co-founded the Cornell Cox Group (now Cornell Companies, Inc.)
in 1990 and served as its president and chief operating officer
until 1996.

WCC is a world leader in the delivery of correctional and
detention management, health and mental health services to
federal, state and local government agencies around the globe. WCC
offers a turnkey approach that includes design, construction,
financing and operations. The Company represents 31 government
clients servicing 49 facilities in the United States, Australia,
South Africa, New Zealand, and Canada with a total design capacity
of approximately 36,500 beds.

As reported in Troubled Company Reporter's May 5, 2003 edition,
Standard & Poor's Ratings Services placed its 'BB-' corporate
credit and 'BB' senior secured debt ratings on Wackenhut
Corrections Corp., on CreditWatch with negative implications.
Negative implications mean that the ratings could be lowered or
affirmed, following Standard & Poor's review.

Boca Raton, Florida-based WCC, a provider of a comprehensive range
of prison and correctional services, had about $125 million of
debt outstanding at Dec. 29, 2002.


WATERLINK: Wants Time to File Schedules Extended to August 11
-------------------------------------------------------------
Waterlink, Inc., and its debtor-affiliates ask the U.S. Bankruptcy
Court for the District of Delaware to extend the time period
within which they must file their schedules of assets and
liabilities, statements of financial affairs and lists of
executory contracts and unexpired leases required under 11 U.S.C.
Sec. 521(1).

The Debtors point out that they have more than 350 creditors.  In
order to prepare and file the Schedules and Statements, the
Debtors must review and synthesize information from the books and
records of multiple Debtors relating to many transactions.

The Debtors report that they have already commenced working on the
preparation of the Schedules and Statements.  Nevertheless, in
view of the amount of work entailed in this project, and the
competing demands upon the Debtors' existing employees, it does
not appear likely that the Debtors will be able to complete the
Schedules and Statements properly and accurately by the 30-day
deadline.

Consequently, the Debtors ask the Court to afford them until
August 11, 2003 to file their Schedules and Statements with the
Court.

Waterlink, Inc., headquartered in Columbus, Ohio, is an
international provider of integrated water and air purification
solutions for both industrial and municipal customers.  The
Company filed for chapter 11 protection on June 27, 2003 (Bankr.
Case No. 03-11989).  Kurt F. Gwynne, Esq., at Reed Smith LLP
represents the Debtors in their restructuring efforts.  As of
March 31, 2003, the Debtors listed $36,719,000 in total assets and
$51,081,000 in total debts.


WEIRTON STEEL: Court Approves Access to $225 Mill. DIP Financing
----------------------------------------------------------------
Transamerica leases certain equipment to Weirton Steel Corporation
pursuant to a Master Lease Agreement.  Jeffrey C. Wisler, Esq., at
Connolly, Bove, Lodge & Hutz, in Wilmington, Delaware, relates
that to the extent the Lease is subject to being characterized as
a financing arrangement, Transamerica holds a valid, perfected,
first priority, purchase money, security interest in the
Equipment.

To recall, the Debtor seeks to secure its postpetition financing
with, inter alia, perfected, first priority liens on all of the
Debtor's real and personal property, subject to "Permitted Liens"
pursuant to Section 364(d) of the Bankruptcy Code.

Mr. Wisler adds that the Lease is a true lease, and not subject
to any challenge as to its characterization.  However, out of an
abundance of caution, in the event that the Lease is
recharacterized, Transamerica objects to the Debtor's request to
the extent that it could prime Transamerica's protective lien on
the Equipment.

Also, the term Permitted Liens is not adequately defined in any
of the pleadings.  Transamerica is unable to determine whether
its protective lien on the Equipment is a Permitted Lien.  If
Transamerica's protective lien on the Equipment is not a
Permitted Lien, then under the terms proposed in the Debtor's DIP
Financing, it would be improperly primed by the Postpetition
Liens.  Moreover, even if it is determined that Transamerica's
protective lien on the Equipment is a Permitted Lien, it is not
clear that "subject to" means that the Postpetition Liens will
not prime Transamerica's protective lien on the Equipment.

Section 364(d)(1)(B) requires that the Debtor may be authorized
to obtain credit senior to Transamerica's protective lien on the
Equipment, but "only if . . . there is adequate protection of the
interest of the holder of the lien on the property of the estate
on which the senior or equal lien is proposed to be granted."
Although the Debtor's DIP Financing proposes to provide the
Prepetition Agent and the Prepetition Lenders with adequate
protection, no protection is proposed for Transamerica.

Accordingly, Mr. Wisler points out, the Debtor cannot satisfy the
requirements of Sections 364(d)(1) and (2) of the Bankruptcy
Code, and may not obtain authorization to grant the Postpetition
Liens unless and until Transamerica is provided with adequate
protection.

Thus, Transamerica asks the Court to deny the Debtor's request,
or condition the DIP Financing approval on modification of the
final order to:

     (1) specifically exclude Transamerica's Equipment from the
         assets proposed to secure the Postpetition Liens,

     (2) specify that Transamerica's protective lien on the
         Equipment is a Permitted Lien and clarify in the order
         that it is not primed by Postpetition Liens, or

     (3) provide Transamerica with adequate protection as specified
         in Section 364(d)(1)(B) of the Bankruptcy Code.

In addition, Transamerica reserves the right to review any
proposed final DIP Financing order, including attachments,
submitted to the Court at or prior to the final hearing.

  General Electric Capital Business Asset Funding Corporation

Craig B. Young, Esq., at Connolly, Bove, Lodge & Hutz, in
Washington, D.C., tells the Court that General Electric is the
Lessor of certain equipment to the Debtor pursuant to a Master
Equipment Lease Agreement, as amended, dated May 27, 1998.  To
the extent the Lease is subject to being recharacterized as a
financing arrangement, GE Capital holds a valid, perfected, first
priority, purchase money, security interest in the Equipment.

The Court issued an Order granting Fleet Capital Corporation,
Foothill Capital Corporation, The CIT Group/Business Credit,
Inc., GMAC Business Credit, LLC, Transamerica Business Capital
Corporation, Manchester Securities Corp., and any other lender
from time to time party to the Postpetition Loan Agreement, a
priming lien on all of the Debtor's property pursuant to Sections
364(c)(1), (c)(2), (c)(3), and (d)(1) of the Bankruptcy Code.

GE Capital objects to the Order to the extent the Debtor seeks to
prime GE Capital's interests and liens on the Equipment.  To the
extent the Lease and related Schedules are true leases, the Order
will create an interest in the Postpetition Lenders' favor that
will prime GE Capital's interest in the Equipment.

Mr. Young points out that the Debtor can grant security interests
in property to its Postpetition Lenders only to the extent the
Debtors could have done so outside of bankruptcy.  Section 364
only authorizes the Debtor to grant liens on property of the
Debtor's estates.  Thus, the Order cannot grant an interest or
lien on the leased Equipment.

Furthermore, because the term Permitted Liens is not adequately
defined in any of the pleadings, GE Capital is unable to
determine whether its protective lien on the Equipment is a
Permitted Lien.  If GE Capital's protective lien on the Equipment
is not a Permitted Lien, then under the terms proposed in the DIP
Financing it would be improperly primed by the Postpetition
Liens.  Even if GE Capital's protective lien is determined a
Permitted Lien, it is not clear that "subject to" means that the
Postpetition Liens will not prime GE Capital's protective lien on
the Equipment.

Mr. Young notes that no adequate protection is proposed for GE
Capital.  In effect, the Debtor cannot satisfy the requirements
of Sections 364(d)(1) and (2) of the Bankruptcy Code.  Hence, Mr.
Young asserts, the Debtor may not obtain authorization to grant
the Postpetition Liens unless until GE Capital is provided with
adequate protection.

In addition, GE Capital reserves the right to review any proposed
final order on the DIP Financing submitted to the Court at or
prior to the final hearing.

Ultimately, GE Capital asks the Court to deny the Debtor's
request, or condition the DP Financing's approval on modification
of the final order to:

     (1) specifically exclude GE Capital's Equipment from the
         assets proposed to secure the Postpetition Liens,

     (2) specify that GE Capital's protective lien on the Equipment
         is a Permitted Lien and clarify in the order that it is
         not primed by Postpetition Liens, or

     (3) provide GE Capital with adequate protection as specified
         in Section 364(d)(1)(B).

                            McCarl's Inc.

Vincent S. Guerrera, Esq., in West Virginia, recounts that prior
to the Petition Date, the Debtor and McCarl's entered into a
contract, where McCarl's replaced two stationary skids in the
walking beam furnace and water cooled lintel on the furnace at
the Debtor's Hot Strip Mill, in Hancock County, West Virginia.

Upon the Debtor's assurances that it would not be filing
bankruptcy, McCarl's worked on the Hot Strip Mill Project from
March 10, 2003 until March 26, 2003.  The Debtor owes McCarl's
$1,089,633 for the Hot Strip Mill Project, but has failed to pay
any amounts.  Also, the Debtor has not disputed the amount due to
McCarl's.

Pursuant to an amendment to the agreement between both parties,
Mr. Guerrera notes that McCarl's was permitted to retain its
mechanic's lien rights with respect to the Hot Strip Mill
Project.  McCarl's was advised that the Debtor's senior lenders
have authorized the amendment.  As a result, McCarl's filed its
mechanic's lien in the County Court of Hancock County, West
Virginia.  Pursuant to Sections 362(b)(3) and 546(b)(1) of the
Bankruptcy Code, and West Virginia Code 38-2-17, the Mechanic's
Lien filed against the Debtor relates back to March 10, 2003.

Mr. Guerrera points out that the DIP Financing fails to
specifically address McCarl's mechanic's lien claim in its
recital of outstanding liens against the Debtor's assets.
Indeed, the inclusion of McCarl's on the Debtor's initial listing
of 20-Largest Unsecured Creditors suggests that the Debtor and
its lenders did not focus on McCarl's mechanic's lien rights when
the DIP Financing facility was negotiated.

In addition, Mr. Guerrera asserts that the term "Permitted Liens"
is not adequately defined for McCarl's to determine if it
includes the mechanic's lien.  McCarl's understands that a deed
of trust was filed after the Petition Date as against the
Debtor's Hot Strip Mill, among other assets, to secure the
Debtor's postpetition lenders.  However, McCarl's lien in the Hot
Strip Mill has priority over the postpetition Deed of Trust.

McCarl's opposes the entry of a final DIP Order granting any
liens senior to its mechanic's lien on the Hot Strip Mill.
Hence, McCarl's asks the Court to deny the Debtor's request or to
condition its approval upon the Order being modified to:

     (1) provide for the payment of McCarl's mechanic's lien claim
         in full,

     (2) provide a clarification of the definition of "Permitted
         Liens" to include McCarl's mechanic's lien in order to
         make clear that it is not primed by the Postpetition
         Liens, or

     (3) provide McCarl's with adequate protection as specified in
         Section 364 (d)(1)(B) of the Bankruptcy Code.

                United States Steel Corporation

The Debtor entered into a memorandum of understanding with U.S.
Steel for the purchase of coke prepetition, where the Debtor
purchases coke from U.S. Steel F.O.B., U.S. Steel's coke facility
in Clairton, Pennsylvania.

U.S. Steel ships approximately 28 carloads of coke to the Debtor
F.O.B. Clairton on a daily basis.  The coke that is in transit
from Clairton to Weirton on a daily basis is in addition to
stockpiles of coke the Debtor maintained at its facility.

Michael Kaminski, Esq., at DKW Law Group, PC, in Pittsburgh,
Pennsylvania, refers to Section 2-702(6) of the Uniform
Commercial Code as enacted in Pennsylvania, which provides that
if a seller discovers that the buyer has received goods on credit
while insolvent, the seller may reclaim the goods upon demand
made within 10 days after the receipt.  Mr. Kaminski continues
that pursuant to Section 546(c)(2) of the Bankruptcy Code, the
Court cannot deny reclamation to a seller with a right of
reclamation that has made demand in accordance with the
provisions of Section 546(e)(1) unless the Court grants the claim
of the seller priority as a claim of a type specified in Section
503(b) of the Bankruptcy Code or if the Court secures the claim
by a lien.

Within six hours of the Debtor's Chapter 11 filing, Mr. Kaminski
relates that U.S. Steel made written demand for reclamation of
goods having a value of approximately $1,059,000.  Subsequently,
the Court gave interim approval of the Debtor's DIP financing on
May 20, 2003.  Pursuant to the Interim Order, a portion of the
postpetition credit facility was to be used to pay in full the
Debtor's prepetition credit facility.  Furthermore, the DIP
financing facility is to be secured by liens which prime existing
liens pursuant to Bankruptcy Code Section 364(d).

U.S. Steel objects to the priming of any lien which it may have
as a result of its timely reclamation demand unless it is
provided adequate protection.  Accordingly, U.S. Steel asks the
Court to specifically provide U.S. Steel adequate protection for
its reclamation claim in any Order authorizing DIP financing.

                            *     *     *

After due deliberation, Judge Friend issued a final order on
Weirton's DIP financing, which include:

1. Authorization to Incur Postpetition Debt

     (a) Approval of Postpetition Documents

         The Postpetition Documents and all of the terms and
         conditions were approved in their entirety.  The Debtor is
         authorized and directed to:

         (1) execute any additional documents that the Postpetition
             Agent and Postpetition Lenders deem necessary to
             implement the transactions contemplated by the
             Postpetition Documents; and

         (2) perform each of its obligations under and comply with
             all of the terms and provisions of the Postpetition
             Documents and this Order.

     (b) Payment of Prepetition Debt

         The Debtor used a portion of the initial advance of the
         Postpetition Debt to pay the Prepetition Debt in full on a
         provisional basis.  The payment of the Prepetition Debt
         will become final and binding on all parties-in-interest
         in the Case and their successors and assigns, including,
         without limitation, any Trustee, unless the Committee
         timely files with the Court, no later than August 15,
         2003, an adversary proceeding challenging any or all of
         the stipulations and findings in this Order regarding the
         Prepetition Debt or the Prepetition Liens.

         If no such adversary proceeding is timely filed, the
         Prepetition Agent is directed to, on or after August 16,
         2003, execute and deliver to Postpetition Agent the
         releases, waivers and terminations which Postpetition
         Agent deems necessary or desirable from time to time to
         extinguish the Prepetition Liens.  If an adversary
         proceeding is filed and Prepetition Agent or any
         Prepetition Lender is required to disgorge any monies
         received from the Debtor, the Postpetition Agent, or any
         Postpetition Lender in satisfaction of Prepetition Debt or
         otherwise, the monies will be remitted directly to the
         Postpetition Agent and will, without further Court order,
         be applied by the Postpetition Agent to the Postpetition
         Debt in accordance with this Order.

     (c) Other Permitted Uses of Postpetition Debt

         The Debtor is authorized to incur Postpetition Debt:

         (1) solely in accordance with and pursuant to the terms
             and provisions of this Order and the Postpetition
             Documents, including without limitation, the
             provisions of the Postpetition Loan Agreement; and

         (2) solely for the purposes allowed under Section 1.1.3 of
             the Postpetition Loan Agreement.

2. Procedure for Delivery of Cash Proceeds

     (a) Delivery of Cash Proceeds to the Postpetition Agent

         The Debtor is authorized and directed to deposit all Cash
         Proceeds, regardless of the source of the Cash Proceeds,
         now or hereafter in its possession or under its control
         into the Blocked Accounts promptly upon receipt thereof.

     (b) Account Debtors

         Without further Court order, the Postpetition Agent may
         direct the Debtor to, or the Postpetition Agent may
         directly, instruct all account debtors of existing and
         future accounts receivable included in the Collateral to
         make payments directly into the Blocked Accounts or other
         accounts satisfactory to Postpetition Agent, in which
         event all Cash Proceeds will be applied to the
         Postpetition Debt.

     (c) Cash Proceeds in the Postpetition Agent's Possession

         The Postpetition Agent is authorized to collect upon,
         convert to Cash Proceeds and enforce checks, drafts,
         instruments and other forms of payment now or hereafter
         coming into its possession or under its control which
         constitute Collateral or proceeds of Collateral.

3. Super-priority Administrative Expense Status; Postpetition
     Liens

     The Postpetition Debt is granted superpriority administrative
     expense status under Section 364(c)(1) of the Bankruptcy
     Code, with priority over all costs and expenses of
     administration of the Case that are incurred under any
     provision of the Bankruptcy Code, other than the Carve-out.

     In addition, the Postpetition Agent is granted, for the
     benefit of itself and each Postpetition Lender, the
     Postpetition Liens to secure the Postpetition Debt.  The
     Postpetition Liens:

     (a) are and will be First Priority Liens, subject only to
         Permitted Liens without any further action by the Debtor,
         Postpetition Agent, or Postpetition Lenders and without
         the execution, filing or recordation of any financing
         statements, security agreements, mortgages or other
         documents or instruments;

     (b) will not be subject to any security interest or lien which
         is avoided and preserved; and

     (c) will remain in full force and effect notwithstanding any
         subsequent conversion or dismissal of the Case.

4. Carve-out Terms

     (a) (1) The Estate Professionals Carve-out will be for the
             benefit of professionals of the Debtor and the
             Committee and will consist of the sum of all allowed
             unpaid but budgeted professional fees and expenses
             accrued by the parties prior to the Termination Date,
             plus $1,000,000,

         (2) The Exchange Indenture Trustee Carve-out will be for
             the benefit of the Exchange Indenture Trustee
             Professionals and will consist of the sum of the
             Exchange Indenture Trustee Professional Fees accrued
             prior to the Termination Date, up to a maximum of
             $650,000, and

         (3) The Exchange Indenture Trustee Holders Committee
             Carve-out will be for the benefit of the Exchange
             Indenture Trustee Holders Professionals and will
             consist of the sum of Exchange Indenture Trustee
             Holders Committee Professional Fees accrued prior to
             the Termination Date, up to a maximum of $350,000;

     (b) All prepetition retainers and any other property of the
         estate will be used to pay any allowed professional fees
         and expenses of any of the Debtor, the Exchange Indenture
         Trustee Professionals, the Exchange Indenture Holders
         Committee Professionals, and the Committee before any
         payments of the professional fees are made from the
         Postpetition Debt or the Collateral;

     (c) The Postpetition Agent will have the right to establish
         reserves under Section 1.1.1 of the Postpetition Loan
         Agreement:

         (1) with respect to the Estate Professionals Carve-out, in
             an amount equal to the aggregate of all budgeted
             professional fees and expenses for the then-current
             month or prior months that remain unpaid, plus
             $1,000,000,

         (2) with respect to the Exchange Indenture Trustee
             Carve-out, $650,000 minus any payments of Exchange
             Indenture Trustee Professional Fees made during the
             Case, and

         (3) with respect to the Exchange Indenture Holders
             Committee Carve-out, $350,000 minus any payments of
             Exchange Indenture Trustee Professional Fees made
             during the Case;

     (d) Upon the Termination Date, and with the exception of the
         Carve-outs, the Postpetition Agent will have no obligation
         to fund any fees or expenses accrued prior to the
         Termination Date; and

     (e) The Carve-outs will not include, and no Postpetition Debt
         or Collateral may be used to pay, any fees or expenses
         incurred by any of the Debtor, the Exchange Indenture
         Trustee Professionals, the Exchange Indenture Holders
         Committee Professionals, or the Committee in connection
         with claims, actions or services adverse to the
         Prepetition Agent, the Prepetition Lenders, the
         Postpetition Agent, the Postpetition Lenders, or any of
         their interests in any of the Collateral.

5. Termination of Right To Incur Postpetition Debt

     (a) Termination Date

         Unless extended by the Court upon the written agreement of
         the Postpetition Agent, this Order and the Debtor's
         authorization to incur Postpetition Debt pursuant to this
         Order will automatically terminate on the Termination Date
         without further notice or Court order.

     (b) Rights Upon Termination

         Upon the Termination Date, without further notice or order
         of the Court, at the Postpetition Agent's election:

         (1) The Postpetition Debt will be immediately due and
             payable;

         (2) The Postpetition Agent will be entitled to apply or
             set off any Cash Proceeds in the Postpetition Agent's
             possession or control to the Postpetition Debt in
             accordance with this Order, until the Postpetition
             Debt is indefeasibly and finally paid in full; and

         (3) The Debtor will be prohibited from using any Cash
             Proceeds for any purpose other than application to the
             Postpetition Debt.

6. Additional Consideration For Postpetition Debt

     (a) Application of Cash Proceeds

         The Postpetition Agent, at its election, is authorized to
         apply all Cash Proceeds now or hereafter coming into
         the Postpetition Agent's possession or control.  All
         applications will be final and not subject to challenge by
         any person, subject only to the right of parties-in-
         interest to object solely to applications to the
         Postpetition Charges consisting of attorneys' fees and
         expenses.

     (b) Prohibition Against Use of Cash Collateral

         The Debtor will not use or seek to use Cash Proceeds,
         unless:

         (1) the Postpetition Agent has consented to the order;

         (2) there is no Postpetition Debt outstanding at the time
             of the entry of an order, and no obligation of the
             Postpetition Agent to extend additional Postpetition
             Debt; or

         (3) the Cash Proceeds are first used to immediately and
             indefeasibly finally pay the Postpetition Debt in
             full.

     (c) Prohibition Against Additional Debt

         The Debtor will not incur or seek to incur debt secured by
         a lien which is equal to or superior to the Postpetition
         Liens, or which is given superpriority administrative
         expense status under Section 364(c)(1) of the Bankruptcy
         Code, unless:

         (1) the Postpetition Agent has consented to the order;

         (2) there is no Postpetition Debt outstanding at the time
             of the entry of the order, and no obligation of Lender
             to extend additional Postpetition Debt; or

         (3) the credit or debt is first used to immediately and
             indefeasibly finally pay the Postpetition Debt in
             full.

     (d) No Surcharge

         At no time during the Case will the surcharge provisions
         of Section 506(c) of the Bankruptcy Code or the
         enhancement of collateral provisions of Section 552 of the
         Bankruptcy Code be imposed on the Postpetition Agent, any
         Postpetition Lender, Exchange Indenture Trustee, any
         Exchange Indenture Holder or any of the Collateral for the
         benefit of any party-in-interest.

     (e) Right to Credit Bid

         Provided that either the Postpetition Debt has been
         indefeasibly and finally paid in cash in full, or that
         consummation of the credit bid would result in the
         immediate indefeasible and final payment of the
         Postpetition Debt in cash in full:

         (i) The Postpetition Agent will have the right to use the
             Postpetition Debt or any part thereof to credit bid
             with respect to any bulk or piecemeal sale of all or
             any portion of the Collateral; and

        (ii) The Exchange Indenture Trustee will have the right to
             use the Exchange Indenture Debt or any part thereof to
             credit bid with respect to any bulk or piecemeal sale
             of all or any portion of the Exchange Indenture
             Collateral.

     (f) Plan

         No order will be entered confirming a plan in this Case
         unless the order provides for the indefeasible and final
         payment of the Postpetition Debt in full in cash on the
         earlier of the effective date and the Termination Date.

     (g) Indemnification

         The Debtor will indemnify and hold harmless the
         Postpetition Agent and the Postpetition Lenders pursuant
         to Section 12.2 of the Postpetition Loan Agreement.

7. Adequate Protection Of Interests Of Exchange Indenture Trustee
     and Exchange Indenture Holders

     (a) Exchange Indenture Replacement Liens

         The Exchange Indenture Trustee is granted, for the benefit
         of itself as collateral agent and for the benefit of each
         Exchange Indenture Holder, the Exchange Indenture
         Replacement Liens.  The Exchange Indenture Replacement
         Liens:

         -- are and will be in addition to the Exchange Indenture
            Liens;

         -- are and will be properly perfected, valid and
            enforceable liens, without any further action by
            Debtor or Lender and without the execution, filing or
            recordation of any financing statements, security
            agreements, mortgages or other documents or
            instruments;

         -- are and will be junior in all respects to the
            Postpetition Liens, the Prepetition Liens, all other
            claims of Postpetition Agent, each Postpetition
            Lender, Prepetition Agent, and each Prepetition
            Lender, including, without limitation, any claims of
            any party under Sections 503, 507(b) or 364(c) of the
            Bankruptcy Code and all other Permitted Liens; and

         -- will remain in full force and effect notwithstanding
            any subsequent conversion or dismissal of the case.

     (b) Postpetition Interest

         The Exchange Indenture Trustee will have the right to be
         paid postpetition interest under the Exchange Instruments
         during the Case to the extent allowed under the
         Postpetition Documents.  The payments will be
         recharacterized as payments of principal of the Exchange
         Indenture Debt if and to the extent the value of the
         Prepetition Collateral as of the Petition Date is less
         than the aggregate of the amounts of the Prepetition Debt
         and the Exchange Indenture Debt as of the Petition Date.

     (c) Exchange Indenture Trustee Professional Fees

         Unless making a payment would result in the Exchange
         Indenture Trustee Carve-out being exhausted, the Debtor is
         directed to:

         -- if no objection is filed, pay all Exchange Indenture
            Trustee Professional Fees upon expiration of the
            15-day period; and

         -- if an objection is filed, pay all allowed Exchange
            Indenture Trustee Professional Fees upon the entry of
            a final Court order resolving the objection.

     (d) Exchange Indenture Holders Committee Professional Fees

         Unless making this payment would result in the Exchange
         Indenture Holders Committee Carve-out being exhausted,
         The Debtor is directed to:

         (1) if no objection is filed, pay all Exchange Indenture
             Holders Committee Professional Fees upon expiration of
             the 15-day period; and

         (2) if an objection is filed, pay all allowed Holders
             Committee Exchange Indenture Professional Fees upon
             the entry of a final Court order resolving the
             objection. (Weirton Bankruptcy News, Issue No. 5;
             Bankruptcy Creditors' Service, Inc., 609/392-0900)


WIRE ROPE: Completes $54.5 Mil. Asset Sale Transaction with KPS
---------------------------------------------------------------
KPS Special Situations Fund II completed the acquisition out of
bankruptcy of the assets of Wire Rope Corporation of America,
Incorporated for approximately $53 million in assumed debt and
$1.5 million in cash. KPS acquired the assets through a newly
formed company, which has been renamed Wire Rope Corporation of
America, Inc.

Based in St. Joseph, Missouri, WRCA is the nation's leading
producer of high carbon wire and wire rope products and is the
largest domestic supplier of wire rope products to the mining, oil
and gas, construction and steel industries. With 915 employees,
WRCA operates four manufacturing facilities and seven distribution
centers across the country. KPS has formed a new senior management
team under the leadership of Ira Glazer, the newly appointed Chief
Executive Officer and former Chief Restructuring Officer of WRCA.
Eric Bruder has been named Senior Vice President of Manufacturing
and John Josendale has assumed the position of Senior Vice
President of Sales, Marketing and Fabricated Products.

"We are extremely pleased to be involved in the successful
reemergence of WRCA," said Stephen Presser, a Principal of KPS.
"The company's management, union and employees have all worked
tremendously hard to reduce the company's cost structure and to
rationalize its operations. The company's turnaround will allow
WRCA to provide quality products and services to customers and
retain its market leadership in the wire rope industry. With a
solid financial structure now in place and valuable new
relationships with other KPS portfolio companies, WRCA is
positioned as the dominant player in this market."

KPS will make $16.5 million of capital investments in WRCA,
including a $14 million equity investment and a $2.5 million
secured loan, to fund working capital requirements as the Company
continues to execute its restructuring program. In addition, KPS
has successfully renegotiated and extended approximately $50
million in WRCA credit facilities, including a $35 million senior
lending facility with HSBC USA and secured loans by Citizen's Bank
and Trust of Chillicothe, Missouri and Amsted Industries.

"This is a core transaction for KPS and our investment strategy,"
Mr. Presser explained. "WRCA is a proven market leader with a
sound business franchise. By working with all of the company's
stakeholders, we have simplified operational costs and created a
viable capital structure that results in a healthy, profitable
company. KPS will actively support WRCA through its turnaround and
we will continue to carefully structure our acquisitions so as to
preserve our cash for the direct working capital needs of our
portfolio companies."

Mr. Ira Glazer, Chief Executive Officer of WRCA, said: "We are
pleased to have emerged from bankruptcy as a market leader with so
many exciting prospects in front of us. The capital and turnaround
expertise of the KPS team were instrumental in taking this company
out of bankruptcy and creating a new WRCA with a clean balance
sheet and unlimited prospects for the future. We are thrilled to
have the ongoing commitment of KPS as we continue our efforts to
build our position as the premier supplier of wire rope products
in North America."

The KPS Special Situations Funds are a family of private equity
funds focused on constructive investment in distressed companies,
restructurings and other special situations in partnership with
employees and senior managers. KPS has purchased operating assets
out of bankruptcy; established stand-alone entities to operate
divested assets; and recapitalized highly leveraged public and
private companies through equity infusions.

KPS' investment strategy targets companies with strong franchises
but which are experiencing operating and financial problems. KPS
invests its capital concurrently with a turnaround plan predicated
on cost reduction, capital investment, capital availability, and
in most situations, the introduction of new management. The
operational turnaround plan is accompanied by a financial
restructuring of the company's liabilities, either in or out of
bankruptcy. KPS often works constructively with unions and
employee groups to effect immediate change. The KPS investment
strategy and portfolio companies are described in detail at
http://www.kpsfund.com

Wire Rope Corporation of America, Incorporated's chapter 11
proceeding is pending before the United States Bankruptcy Court
for the Western District of Missouri (Bankr. Case No. 02-50493-
JWV).


WORLDCOM INC: AFC Calls for Competition in Federal Contracting
--------------------------------------------------------------
Tuesday, the General Services Agency began suspension proceedings
against MCI, formerly known as WorldCom, to determine whether the
company will be permitted to bid on federal contracts. Tuesday,
the American Freedom Center called on the GSA to reject the self-
interested attempt by labor unions and MCI's competitors to
exclude MCI from competitive bidding on federal contracts. AFC,
along with other leading free-market organizations such as Grover
Norquist's Americans for Tax Reform -- http://www.atr.org/-- and
the Center for Freedom and Prosperity  --
http://www.freedomandprosperity.org-- sent a June 12 letter sent
to GSA Administrator Stephen Perry in support of MCI's position.
The letter can be found on ATR's Web site at
http://www.atr.org/pdffiles/mci.pdf

American Freedom Center Fellow Brendan Steinhauser stated, "For a
federal contractor to be suspended, there must be adequate
evidence of infractions that affect the present responsibility of
the firm or individual to conduct future business with the
government. However, no one has alleged that MCI is not faithfully
performing its $772 million in federal contracts. MCI continues to
service these contracts without interruption, including one to
build a wireless network in Iraq. Arbitrarily terminating all of
these contracts will cause unnecessary disruption in government
functions and increase the cost to taxpayers by reducing the
number of firms competing for government business."

Steinhauser noted, "The effort to bar MCI from receiving federal
contacts is a cynical, self-serving ploy led by the Communication
Workers of America and AT&T, who are using high-priced lobbyists
and an advertising blitz in their well-orchestrated campaign. CWA
remains upset that the majority of MCI employees rebuffed their
attempt to unionize them several years ago and wishes to see these
contracts go to MCI's unionized competitors. AT&T's motive for
bankrolling this campaign against MCI is equally crass, as they
are a likely recipient of some of the contracts that now go to
MCI."

Steinhauser explained, "MCI is going through bankruptcy
proceedings, but no one would seriously propose discriminating
against individuals applying for federal jobs who have gone
through personal bankruptcy. Similarly, the federal government
continues to purchase airline tickets from bankrupt airlines.
Although the company's former executives misled shareholders,
MCI's reorganization plan has been approved by over 90 percent of
its creditors and the company has agreed to pay a record $500
billion to shareholders in a settlement with the Securities and
Exchange Commission. Finally, MCI has brought in a new CEO and
Board of Directors, purging former CEO Bernie Ebbers and all other
officials who defrauded shareholders."

Steinhauser concluded, "Banning MCI from receiving federal
contracts will only punish the company's innocent employees and
shareholders, not the former executives who already face civil and
possibly criminal punishment in our courts. The interests of
taxpayers are not served by the politicization of federal
contracts to exclude companies and, thereby, reduce competition in
bidding, for reasons other than the company's ability to perform."

The American Freedom Center is a non-profit public policy
institute dedicated to educating the public about the ideas of
economic freedom and individual liberty on which the United States
was founded.


* Greggory Mendenhall Joins Sheppard Mullin in Washington, D.C.
---------------------------------------------------------------
Sheppard, Mullin, Richter & Hampton LLP announced today that
Greggory B. Mendenhall has joined the Firm as special counsel in
the Finance and Bankruptcy Practice Group, in Washington, D.C.
Mendenhall's practice includes maritime finance, ship
construction, federal maritime regulation and policy, corporate
and business transactions, Internet governance and policies, and
federal legislative and administrative representation. He
represents clients before various federal agencies, including the
Department of Transportation, the Department of Commerce, the
United States Coast Guard, the Military Sealift Command, the
United States Customs Service, and the Federal Communications
Commission. He also represents client policy matters before the
United States Congress.

Bob Magielnicki, Administrative Partner of the Washington, D.C.
office, said, "Gregg is a talented attorney with a great deal of
experience in commercial financing and maritime law. He brings
added expertise to Sheppard Mullin's growing Washington office."
Added Richard Brunette, Chair of the Finance and Bankruptcy
Practice Group, "Gregg brings substantial breadth to our finance
capabilities. His skill set fits well into our strategic plan to
grow the finance practice on the East Coast."

Commented Mendenhall, "I am excited to join Sheppard Mullin and
practice law with my former colleagues in Washington, D.C.
Sheppard Mullin is a great firm with a substantial finance
practice that serves leading financial institutions. I look
forward to developing the practice on the East Coast, as well as
continuing my federal administrative and legislative practice."

Mendenhall has extensive experience in maritime law, having spent
ten years handling business matters within the industry.
Mendenhall served as vice president and director of United States
Lines, Inc., where he supervised and directed the worldwide vessel
operations, overseas construction of U.S.-flag vessels and the
U.S. Navy chartering operations. He is currently serving as a
director for Trailer Bridge, Inc. Mendenhall represents various
lenders on maritime loans, financial structuring and sale
leaseback transactions. He has negotiated complex domestic tanker
construction contracts and the associated joint venture
citizenship structures and Title XI financing guarantees.
Mendenhall has also negotiated foreign vessel construction
contracts. Additionally, he was instrumental in the passage of
legislation that permitted domestic U.S.-flag vessel lease
financing and changed the certificate of documentation
endorsements and manning requirements of the U.S. Coast Guard. He
also has represented the International Air Transport Association
in the securitization of airline receivables through the IATA
Currency Clearance Service.

Mendenhall received his law degree from The George Washington
University Law School in 1971, and his undergraduate degree from
Brigham Young University in 1968. He is admitted to practice in
the District of Columbia and the United States District Court for
the District of Columbia. In addition to being a member of the
American Bar Association, Mendenhall is a member of the District
of Columbia Bar Association, the Maritime Law Association of the
United States, and the Association of Commercial Finance
Attorneys. He has conducted several presentations on various
maritime and aviation issues.

The Washington, D.C. office also previously welcomed associate,
Robert L. Magielnicki, Jr. Magielnicki concentrates his practice
on general corporate transactions, mergers and acquisitions,
federal and state tax planning and compliance, tax controversy
resolution, probate and administration of complex trusts and
estates, tax exempt organizations, fiduciary litigation,
charitable giving, and asset protection planning. He received his
law degree from Stetson University College of Law in 1996, where
he was Law Review Articles and Symposia Editor, and his
undergraduate degree from the University of Virginia in 1992.

Sheppard Mullin has more than 370 attorneys among its eight
offices in Washington, D.C., Los Angeles, San Francisco, Orange
County, San Diego, Santa Barbara, West Los Angeles, and Del Mar
Heights. The full-service firm provides counsel in Antitrust and
Trade Regulation; White Collar and Civil Fraud Defense; Business
Litigation; Construction, Environmental, Real Estate and Land Use
Litigation; Corporate; Entertainment and Media; Finance and
Bankruptcy; Financial Institutions; Government Contracts and
Regulated Industries; Healthcare; Intellectual Property; Labor and
Employment; Real Estate, Land Use, Natural Resources and
Environment; and Tax, Employee Benefits, Trusts and Estates. The
Firm celebrated its 75th anniversary in 2002.


* Robert Lawrence Joins Orrick's Washington, D.C. Office
--------------------------------------------------------
Orrick, Herrington & Sutcliffe LLP announced that environmental
law attorney Robert Lawrence has joined the firm's energy and
project finance group as a partner in its Washington, D.C. office.
Lawrence is the former chair of the environmental practice group
at Milbank, Tweed, Hadley & McCloy LLP, and will assume the same
role at Orrick.

"With Robert, we have found the perfect candidate to mobilize our
capabilities in the area of environmental law," said Ralph H.
Baxter, Jr., chairman and CEO of Orrick. "His substantial
knowledge of environmental law spans several areas critical to the
clients we serve, ranging from environmental counseling and
litigation, to financing and bankruptcy matters. With Robert's
breadth of expertise, he will prove to be a tremendous resource to
all of our practice areas."

"Robert's knowledge and experience in transactions -- not only in
all 50 U.S. states, but in approximately 25 other countries -- is
a valuable enhancement of Orrick's steadily growing international
capabilities," added Michael Meyers, partner-in-charge of Orrick's
energy and project finance group.

Lawrence focuses on environmental issues in connection with
transactions, with an emphasis on due diligence and contract
negotiation. He is also an experienced transactional lawyer in his
own right, having closed or substantially assisted in closing
"environmentally challenged" transactions and project financings,
such as acquisitions of pesticide and chemical manufacturing
companies, and financing of facilities engaged in waste
management, hazardous waste disposal, wastewater treatment, heavy
manufacturing, mining, and all segments of the energy industry.
Additionally, his experience in high-profile environmental
bankruptcy cases makes him a leading practitioner in this
important sub-specialty.

Orrick, Herrington & Sutcliffe LLP's lawyers serve clients from 12
offices around the world: New York, San Francisco, Silicon Valley,
Washington, D.C., Los Angeles, Orange County, Sacramento, Pacific
Northwest, London, Paris, Milan, and Tokyo.


* DebtTraders' Real-Time Bond Pricing
-------------------------------------

Issuer               Coupon   Maturity  Bid - Ask  Weekly change
------               ------   --------  ---------  -------------
Federal-Mogul         7.5%    due 2004  14.5 - 16.5       0.0
Finova Group          7.5%    due 2009  43.5 - 44.5      +0.5
Freeport-McMoran      7.5%    due 2006  102.5 - 103.5     0.0
Global Crossing Hldgs 9.5%    due 2009  4.5 -  5.0       +0.25
Globalstar            11.375% due 2004  3.0 - 3.5        -0.5
Lucent Technologies   6.45%   due 2029  68.25 - 69.25    -0.75
Polaroid Corporation  6.75%   due 2002  11.0 - 12.0       0.0
Westpoint Stevens     7.875%  due 2005  20.0 - 22.0       0.0
Xerox Corporation     8.0%    due 2027  84.0 - 86.0      -1.5

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

                           *********

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.

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