TCR_Public/030724.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 24, 2003, Vol. 7, No. 145

                          Headlines

ACCLAIM ENTERTAINMENT: Names Paul Eibeler Pres. and COO for NA
ADELPHIA BUSINESS: Wants to Extend $15MM DIP Financing Maturity
ADELPHIA COMMS: Selling Sunshine Network Interests for $3.6 Mil.
ADF GROUP: Reaches Short-Term Debt and Bridge Loan Workout Pact
ADVANSTAR COMM: S&P Assigns B- Rating to $400 Million Sr. Notes

AIR CANADA: Comments on Canada's Competition Tribunal Decision
AIR CANADA: Reports 100% Increase in Online Bookings
AIR CANADA: CIBC Presses for Prompt Execution of Assignment Form
AK STEEL: S&P Cuts Ratings to B+ Over Weak Financial Performance
AMERCO: Court Grants Final Approval of BDO Seidman's Engagement

AMERICA WEST HLDGS: S&P Affirms & Removes B- Rating from Watch
AMES DEPARTMENT: Sues 69 Vendors to Recover Preference Payments
ANTARES PHARMA: Completes Second $2MM Private Equity Placement
ARMSTRONG: Maertin Plaintiffs' Suit Settlement Drawing Fire
ARVINMERITOR INC: Dana's Board Rejects Unsolicited Tender Offer

ARVINMERITOR: Voices Commitment to Offer to Acquire Dana Shares
BAYOU STEEL: Hires Valuation Research as Valuation Consultants
BAY VIEW CAPITAL: Reports $410 Million Net Assets in Liquidation
BENCHMARK ELEC.: Stable Profitability Spurs S&P to Up Ratings
BUDGET GROUP: Plan Filing Exclusivity Extended Until August 1

BURLINGTON IND.: Court Approves Hilco's Engagement as Appraisers
COLUMBUS MCKINNON: Completes $115MM Senior Secured Note Offering
COM21 INC: Inks Definitive Pact to Sell Certain Assets to ARRIS
COMM 2001-J1: Fitch Cuts Class G, H & J Note Ratings to BB/B/B-
CONSOL ENERGY: Liquidity Concerns Prompt S&P's BB+/B Ratings

COVANTA ENERGY: Court Fixes Aug. 14 Bar Date for 30 New Debtors
DEAN FOODS: S&P Affirms BB+ Corporate Credit Rating
DEVINE ENTERTAINMENT: Red Ink Continues to Flow in March Quarter
DOUBLECLICK INC: Reports Improved 2nd Quarter Financial Results
EAGLE-PICHER INC: S&P Assigns B+ Senior Secured Bank Loan Rating

EL PASO CORP: Re-Election of Board's Nominees Confirmed
ENERGY PARTNERS: S&P Assigns B+ Corporate Credit Rating
ENRON CORP: Settlement Shows Cost of Neglecting Risk Management
ENRON CORP: Classification and Treatment of Claims Under Plan
EXIDE TECHNOLOGIES: Court Fixes Aug. 15 as Contaminant Bar Date

FHC HEALTH SYSTEMS: S&P Rates Counterparty Credit Rating at B
GAUNTLET ENERGY: Canadian Court Extends CCAA Stay Until Aug. 29
GENERAL BINDING: Q2 Earnings Results Enter Negative Territory
GRISTEDE'S FOODS: S&P Rates Planned $150M Sr. Secured Notes at B
HARBISON-WALKER: Court Extends Halliburton Stay to Sept. 30

HARTZ MOUNTAIN: S&P Cuts Corporate Credit Rating Down 2 Notches
HILCORP ENERGY: S&P Rates Proposed $350 Million Sr. Notes at 'B'
IMPERIAL PLASTECH: Misses Deadline to File Financials
INTEGRATED HEALTH: Resolves Claims Dispute with BT Off. Products
INTERNET INFINITY: Hires Kabani & Co. to Replace Caldwell Becker

JP MORGAN COMM'L: Fitch Affirms Low-B Ratings on 3 Note Classes
KERR GROUP: S&P Assigns BB- Speculative Grade Credit Rating
KINDERCARE LEARNING: $125 Million Credit Facility Rated 'B+'
LEAP WIRELESS: Court OKs Irell & Manella as Committee's Counsel
LEASE INVESTMENT: Fitch Cuts Four Class Note Ratings to BB/B

LENNOX INT'L: Second Quarter 2003 Results Reflect Improvement
LTV CORP: Wants to Fund Trust to Indemnify Officers & Directors
LTWC CORPORATION: Case Summary & Largest Unsecured Creditors
LUCILLE FARMS: Fails to Comply with Nasdaq Listing Requirements
MANDALAY RESORT: Fitch Rates $250M 6. Senior Unsec. Notes at BB+

MILLENNIUM CHEM: S&P Further Cuts Ratings on Weak Fin'l Profile
MIRANT CORP.: Committee Formation Meeting is Tomorrow in Dallas
MIRANT CORP: Court Restricts Securities Trading to Preserve NOLs
MIRANT CORP: Asks Court to Deem Utilities Adequately Assured
NATIONAL EQUIPMENT: Kurzman Carson Appointed as Claims Agent

NATIONAL STEEL: Retirees' Committee Hires Seyfarth as Counsel
NEXTEL COMMS: S&P Ratchets Corporate Credit Rating Up a Notch
NIFF-CORR LLC: Case Summary & 20 Largest Unsecured Creditors
NTELOS: Proposes New Board of Directors for Reorganized Debtor
OM GROUP: Ratings Off Watch Due to Unit's Nearing Divestiture

OWENS: Claims Status Modification Hearing Continues on July 28
OWENS-ILLINOIS: Reports Decline in Second Quarter Fin'l Results
PACIFIC GAS: Gets Nod to Pay $281 Million Mortgage Bond Maturity
PACIFIC GAS: Modifies BNY Stipulation re Cash Collateral Use
PEABODY ENERGY: Board Raises Cash Quarterly Dividend by 25%

PG&E NATIONAL: Look for Schedules and Statements by August 22
QUANTUM CORP: Fiscal First Quarter Net Loss Stands at $9 Million
REGAL ENTERTAINMENT: Reports Slight Improvement in Q2 Results
RENT-WAY INC: SEC and U.S. Attorney Complete Investigation
RURAL CELLULAR: S&P Junks $325 Million Senior Notes at CCC

SAFETY-KLEEN: Settles Claims Dispute with Dai-Ichi Kangyo Bank
SALEM COMMS: S&P Keeping Watch on B+ Corporate Credit Rating
SIEBEL SYSTEMS: Initiates Restructuring Plan to Reduce Expenses
SK GLOBAL AMERICA: Case Summary & 18 Largest Unsecured Creditors
SPIEGEL GROUP: Wants Blessing to Hire Watson Wyatt as Consultant

SR TELECOM: Closes $4.5 Million Private Placement Transaction
TOWER AUTOMOTIVE: Working Capital Deficit Narrows to $82 Million
UNITED AIRLINES: Turning Over Assets to Northern Trust Company
UPC POLSKA: Gets Court Nod to Hire Ordinary Course Professionals
U.S. CAN CORP: Completes $125 Million 10-7/8% Debt Offering

VANTAGEMED CORP: Appoints Ernie Chastain Vice President of Sales
VICWEST CORP: Creditors' Meeting Scheduled to Convene on Aug. 1
VIRYANET: March 31, 2003 Balance Sheet Upside-Down by $883,000
WABASH NATIONAL: Preparing to Offer $100 Million Conv. Notes
WABASH NATIONAL: June 30 Working Capital Deficit Tops $190 Mill.

WEIRTON STEEL: Obtains Nod to Implement Temporary Layoff Program
WESTPOINT STEVENS: Wants Utility Cos. Deemed Adequately Assured
WINSTAR: Winstar Holdings Asks Court to Hold Network in Contempt
WORLDCOM: NLPC Lauds Hatch Hearing Probing Bankruptcy Proceeding
WORLDCOM INC: CAGW Applauds Hearing to Question MCI's Bankruptcy

WORLDCOM INC: Intends to Assume Two Amended Fionda Agreements

* Dewey Ballantine Adds Partner Lawrence M. Hill to NY Office
* Fried Frank Elects Three New Partners at New York Headquarters

* DebtTraders' Real-Time Bond Pricing

                          *********

ACCLAIM ENTERTAINMENT: Names Paul Eibeler Pres. and COO for NA
--------------------------------------------------------------
As part of its new global operating plan designed to fuel the
Company's future growth, Acclaim Entertainment, Inc. (Nasdaq:
AKLM) has appointed Paul Eibeler as President and Chief Operating
Officer of Acclaim North America. Reporting directly to Rod
Cousens, Chief Executive Officer for Acclaim, Eibeler will be
responsible for overseeing the performance and strategic growth of
the company's North American operations, including product
development, marketing, sales and manufacturing.

Eibeler, a seasoned interactive entertainment industry executive,
most recently served as President and Director of Take-Two
Interactive Software, Inc. (Nasdaq: TTWO), a position he held
since January 2000.  During his tenure at Take-Two, the
organization grew to become the number two publisher in the
interactive entertainment industry.

"We have gone to great lengths to implement new systems to improve
the way we design our products, manage our operating expenses and
stabilize the organization so that it can attain a stronger
position in the marketplace," said Rod Cousens, Chief Executive
Officer for Acclaim.  "An important part of this process includes
strengthening our senior management team, and we are very pleased
to have Paul join us and lend his leadership skills and industry-
wide credibility to help expedite our improved performance and
success."

"I am excited to become part of the new management team," said
Paul Eibeler.  "I believe that Acclaim has a tremendous
opportunity based on its rich history to take advantage of the
growth of the interactive software business."

Prior to joining Take-Two, Eibeler was a consultant to Microsoft's
Xbox launch team.  From 1998 through 1999, he served as Executive
Vice President and General Manager of Acclaim North America.
Earlier in his career, Eibeler held various executive positions
with Impact, Inc., a leading supplier of licensed toys and school
supplies.  Eibeler received a B.A. degree from Loyola College in
1978.

Based in Glen Cove, N.Y., Acclaim Entertainment, Inc. -- whose
March 31, 2003 balance sheet shows a total shareholders' equity
deficit of about $46 million -- is a worldwide developer,
publisher and mass marketer of software for use with interactive
entertainment game consoles including those manufactured by
Nintendo, Sony Computer Entertainment and Microsoft Corporation as
well as personal computer hardware systems.  Acclaim owns and
operates five studios located in the United States and the United
Kingdom, and publishes and distributes its software through its
subsidiaries in North America, the United Kingdom, Australia,
Germany, France and Spain.  The Company uses regional distributors
worldwide.  Acclaim also distributes entertainment software for
other publishers worldwide, publishes software gaming strategy
guides and issues "special edition" comic magazines periodically.
Acclaim's corporate headquarters are in Glen Cove, New York and
Acclaim's common stock is publicly traded on NASDAQ.SC under the
symbol AKLM.  For more information visit its Web site at
http://www.acclaim.com


ADELPHIA BUSINESS: Wants to Extend $15MM DIP Financing Maturity
---------------------------------------------------------------
Pursuant to the Adelphia Business Solutions, Inc.'s Senior DIP
Credit Agreement and the Final DIP Order, the $15,000,000 DIP Loan
from Beal Bank, S.S.B. matures on the earlier of:

    -- July 31, 2003,

    -- the Effective date of a Chapter 11 Plan or Reorganization,
       or

    -- the Termination Date.

Judy G.Z. Liu, Esq., at Weil, Gotshal & Manges LLP, in New York,
notes that since the ABIZ Debtors have yet to file a plan of
reorganization, it would be best for ABIZ to seek an extension of
the Maturity Date from Beal Bank.  Although not yet in the final
form, the Debtors and Beal Bank already agreed to the amendment
of the terms and provisions of the Senior DIP Credit Agreement.
The salient terms of the Amendment will be:

A. Scheduled Maturity:  Extend scheduled Maturity to April 30,
    2004;

B. Administration Fee:  Increase the monthly administration fee
    from $15,000 to $25,000;

C. Extension Fee:  $100,000;

D. Eligible Receivable Covenant:  Modify covenant to permit the
    Debtors to include available cash for purposes of covenant
    compliant.  Minimum aggregate requirement to be $20,000,000
    in eligible receivables and available cash.  Certain cash is
    included, including cash used to satisfy the new cash
    collateral covenant;

E. Cash Collateral Covenant:  Add a requirement to maintain at
    least $5,000,000 in a restricted cash collateral account at
    Beal Bank;

F. Free Cash Flow Covenant:  Adjust the minimum cumulative free
    cash flow covenant for July 2003 and add cumulative monthly
    minimum through extended maturity; and

G. Fee for Future Amendments/Waivers:  A $50,000 amendment and
    waiver fee will be charged for each future amendment or
    waiver.  Not charged in connection with this pending
    amendment; the extension fee applies instead.

The Debtors expect to finalize the Amendment no later than
July 24, 2003 and promise to file the finalized Amendment with
the Court immediately.

In the summer of 2001, the property located at 200 Technology
Drive in Pittsburgh, Pennsylvania, was transferred from Adelphia
Business Solutions of Pennsylvania, Inc. to Adelphia Business
Solutions Investment, LLC.  Since that time, the Property has
been reflected as an asset on ABS Investment's books and records
rather than on ABIZ-PA's.  Also, the Debtors receive all of the
requisite regulatory approvals necessary to consummate the
Transfer.  However, a deed evidencing the Transfer was never
executed and recorded to reflect the Transfer on the land
records.

Under the Final DIP Order, Beal Bank has a first priority lien on
the Debtors' real property.  To grant the mortgage on the
Property that Beal Bank requires, the Debtors need authorization
to correct the real estate records by:

    (i) executing the recording a deed reflecting title to the
        Property in ABS Investment as of the date of Transfer; and

   (ii) granting a mortgage on the Property in Beal Bank's favor.

Accordingly, the ABIZ Debtors ask the Court to:

    (a) approve the Amendment and authorize the extension of the
        Senior DIP Credit Agreement pursuant to the terms and
        conditions presented;

    (b) modify the Final DIP Order to reflect the terms of the
        Amendment; and

    (c) approve the recording of a deed reflecting a previous
        transfer.

Ms. Liu contends that the Amendment is warranted pursuant to
Section 364(c) of the Bankruptcy Code because:

    (a) it will allow the Debtors to maintain a liquidity cushion
        necessary to continue their operations until they confirm
        a plan of reorganization and emerge from Chapter 11 with
        replacement financing;

    (b) the Debtors are unable to obtain alternative financing on
        an unsecured basis; and

    (c) the terms and provisions of the Amendment and
        modification of the Final DIP Order were negotiated at
        arm's length and in good faith between the Parties.
        (Adelphia Bankruptcy News, Issue No. 37; Bankruptcy
        Creditors' Service, Inc., 609/392-0900)


ADELPHIA COMMS: Selling Sunshine Network Interests for $3.6 Mil.
----------------------------------------------------------------
Pursuant to Sections 105 and 363 of the Bankruptcy Code, the
Adelphia Communications Debtors seek the Court's authority to
transfer its interest in Sunshine Network of Florida, Ltd. -- the
Partnership, and shares in Sunshine Network, Inc. -- the
Corporation -- to FSN Sunshine Holdings, Inc.

Shelly C. Chapman, Esq., at Willkie Farr & Gallagher, in New
York, relates that ACOM and FSN are limited partners of the
Partnership, which is governed by the Amended and Restated
Limited Partnership Agreement dated April 15, 1989.  ACOM and FSN
are also shareholders of the Corporation, which is the sole
general partner of the Partnership, and are parties to the
Amended and Restated Shareholders' Agreement dated April 15,
1989.

Currently, ACOM holds an approximate 7.028% limited partnership
interest in the Partnership and 15,437 shares of common stock in
the Corporation.  The Corporation holds a 1% general partnership
interest in the Partnership, thereby giving ACOM a 7.099%
effective ownership interest in the Partnership.  ACOM purchased
the Interest from SFC and Adelphia Cable Partners, L.P. for
$100,000 in March 1994.

As ownership of the Sunshine Network has been largely consolidated
into FSN's hands, Ms. Chapman points out that ACOM's modest
minority interest in the Sunshine Network has no meaningful value
to the estates.  Moreover, the Debtors currently receive no
dividends or distributions on account of the Interest nor do they
expect to receive any in the future.

Ms. Chapman informs Judge Gerber that the sale is memorialized in
an Assumption and Assignment Agreement -- the Documentation --
that contains these salient terms:

    (a) FSN will purchase the Interest for $3,620,461;

    (b) ACOM will convey the Interest to FSN free and clear of
        all liens, claims, security interests, restrictions on
        transfer, or other rights of third parties, except as
        otherwise set forth in the Partnership Agreement or the
        Shareholders' Agreement;

    (c) ACOM must obtain Bankruptcy Court approval of the
        Transaction on or before August 31, 2003; and

    (d) FSN agrees to indemnify ACOM and its affiliates,
        officers, employees, partners, agents and representatives
        against and hold them harmless from all obligations and
        liabilities of ACOM of any nature arising out of,
        relating to or otherwise in respect of the Interest.

Ms. Chapman contends that the Sale Transaction is fair and
reasonable because:

    (a) the Documentation is the result of intensive arm's-length
        negotiations between the parties; and

    (b) the sale allows the Debtors to gain profit from an
        investment that has no meaningful value to the estate.
        (Adelphia Bankruptcy News, Issue No. 36; Bankruptcy
        Creditors' Service, Inc., 609/392-0900)


ADF GROUP: Reaches Short-Term Debt and Bridge Loan Workout Pact
---------------------------------------------------------------
ADF Group Inc., has concluded an agreement with its lending
syndicate on the restructuring of its short-tem debt
(approximately CDN$41.8M) as well as with the bank concerning the
bridge loan (approximately US$15M) granted to ADF for the
acquisition of Owen Steel Company Inc. These agreements were
concluded with the collaboration and support of ADF's bonding
companies.

Pursuant to the agreement with the lending syndicate, the latter
lending syndicate is assigning a $26 million portion of its loan
to an entity to be designated by the bonding companies in
consideration of a payment of $20.2 million, payable by
instalments between July 22 and December 15, 2003. A portion of
the Assignment Price ($10 million) is being guaranteed by the
bonding companies. As of the execution of the agreements, an
amount of approximately $8.5 million has already been paid by ADF
to the lending syndicate on the Assignment Price. The balance of
the lending syndicate's loan is repayable only from a percentage
of the collection of certain claims of ADF.

With respect to the agreement reached with the bank, ADF Group,
the bank and the bonding companies have agreed to put Owen Steel
Company Inc. up for sale. The bank will, under certain conditions,
stay proceedings under the bridge loan until December 15, 2003 and
will limit its recourses in relation to said loan to the assets of
Owen Steel Company Inc.

Jean Paschini, Chairman of the Board and Chief Executive Officer
of ADF stated that he is satisfied that ADF completed an important
phase of its restructuring plan, which will enable the company to
finalize the operational aspect of the plan and to pursue its
discussions with the other stakeholders.

ADF Group Inc. is a North American leader in the design,
engineering, fabrication and erection of complex steel
superstructures, as well as in architectural metal work. ADF is
one of the few players in the industry capable of handling highly
technically complex megaprojects on fast-track schedules in the
commercial, institutional, industrial and public sectors. ADF
operates three fabrication plants: two in Canada and one in the
United States.

At April 30, 2003, the Company's balance sheet shows that its
total current liabilities outweighed its total current assets by
about $40 million.


ADVANSTAR COMM: S&P Assigns B- Rating to $400 Million Sr. Notes
---------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B-' rating to
Advanstar Communication Inc.'s proposed $400 million second
priority senior secured notes maturing in 2008 and 2010.

At the same time, the 'B' rating on the company's revolving bank
credit facility was placed on CreditWatch with positive
implications based on the improved collateral coverage that would
result from the pending reduction in the size of the facility. In
addition, Standard & Poor's affirmed its other ratings, including
its 'B' corporate credit rating. The outlook remains negative. The
Boston, Massachusetts-based business-to-business media company is
analyzed on a consolidated basis with its parent, Advanstar
Inc. Total consolidated debt, pro forma for the proposed
refinancing, is approximately $670 million.

Proceeds will be used to repay about $350 million in bank term
debt and $40 million in revolving credit borrowings. At that time,
the company's bank loan will be reduced to a $60 million revolving
credit facility, and Standard & Poor's will raise its rating on
the facility to 'B+'.

"The repayment of bank debt with higher rate notes will modestly
increase interest expense, although this will be more than offset
by the elimination of all material debt maturities until at least
2007 when the revolving credit facility matures," according to
Standard & Poor's credit analyst Steve Wilkinson. "Proposed
amendments to bank financial covenants will also alleviate
pressure from the scheduled tightening of leverage tests in early
2005," he continued.

The ratings on Advanstar reflect its high financial risk and the
still difficult, but stabilizing, industry operating environment.
These risks are tempered by the good competitive positions of
Advanstar's niche trade show and publishing businesses and the
company's good sector diversity outside of its fashion industry
concentration.

The ratings could come under pressure if Advanstar is unable to
gradually increase its revenue and profitability to improve its
weak key credit measures and to meet the onset of cash interest
payments on its discount notes in April 2006. Ratings could also
be lowered if Advanstar's margin of covenant compliance narrows.


AIR CANADA: Comments on Canada's Competition Tribunal Decision
--------------------------------------------------------------
Air Canada provided the following comment on the Competition
Tribunal's reasons and findings released Tuesday with respect to
the preliminary issue of the avoidable cost test relating to an
application commenced by the Commissioner of Competition against
Air Canada in March 2001.

Air Canada and the Commissioner of Competition had jointly
requested a hearing before the Competition Tribunal for
clarification regarding the avoidable cost test for evaluating
pricing behavior in the Canadian airline industry under the
Competition Act. It was Air Canada's expectation that the
Tribunal's decision about the avoidable cost test would provide
guidance to Air Canada and other airline industry participants
about acceptable pricing behavior.

The hearing, considered to be Phase One of the application, was a
technical exercise involving a review of all of Air Canada's costs
over time periods from April 2000 to March 2001 and a
determination of which of those cost items would be considered
avoidable costs. The Tribunal ruled that all of Air Canada's
overhead costs over the relevant time periods were considered
avoidable costs and concluded that Air Canada had operated below
its avoidable cost on the two sample routes during the two
designated time periods.

"The Canadian airline industry is highly competitive and all
industry participants will need greater clarity as to what pricing
behaviour is acceptable and what constitutes permissible
competitive response," said John M. Baker, Senior Vice President
and General Counsel for Air Canada. "We will review the decision
more carefully before deciding on our next steps.

"The Tribunal made it repeatedly clear in its reasons and findings
that this decision is in no way a determination that Air Canada
breached the Competition Act and that there are many elements
remaining to be addressed in any future phase of the case," said
Mr. Baker.

Air Canada filed for protection under the Companies' Creditors
Arrangement Act (CCAA) on April 1, 2003. The Tribunal has stayed
its decision in view of the CCAA restructuring process providing
for an extension of the timeframe to appeal the decision and
ensuring that no further phases of the application will be dealt
with until after the Company emerges from court protection or the
Court rules otherwise.


AIR CANADA: Reports 100% Increase in Online Bookings
----------------------------------------------------
Air Canada customers are booking in record numbers at
aircanada.com since the airline introduced simple, low,
permanent online fares in mid-May. The airline announced that
online bookings have doubled in just two months. Over 30 per cent
of Air Canada's domestic bookings are now made online, half of
which are being generated through the airline's dedicated travel
agency Web site at http://www.aircanada.com/agents

In addition, Air Canada announced a new feature which offers even
easier online travel planning at http://www.aircanada.comwith the
ability for customers to make their own itinerary changes online.
The airline also announced a new hotel booking tool which offers
accommodation at highly competitive rates and considerable
savings.

"Simple, low domestic fares at aircanada.com have clearly struck a
cord with our customers, who now have more control than ever over
their travel planning," said Montie Brewer, Executive Vice
President, Commercial. "With the addition today of new self-
service tools, our customers have access to more information and
better options than ever for booking travel on Air Canada. We will
continue to add online tools and services that ensure
aircanada.com is where customers come to book their travel as
simply and as easily as possible," he said.

The new online domestic booking structure proving popular with
customers greatly simplifies travel booking with five new fare
categories: Fun, Latitude, Freedom, Econo and Flash fare products
that permanently offer new low, competitive, best-value one way
and return travel. Fun one way web fares offer deep discounts off
full one way fares, while Latitude one way web fares offer full
flexibility and value at an attractive price.

              Self serve online changes now available

Effective immediately, Air Canada customers can not only book Air
Canada's value-based domestic web fares online but can also make
complete or partial changes to their reservations on eligible
domestic routes. aircanada.com customers can now change flights
and pay online as the new booking tool automatically re-prices
trip itineraries.

            Enhanced online hotel booking now available

Effective immediately, aircanada.com , 4321zip.com and
flytango.com offer the ability to book hotels online at a
significant saving. The hotel booking feature includes a wide
selection of value-priced accommodation at 50,000 hotels that may
be searched by property type, location, price and hotel
quality or by the top ten Canadian cities. The enhanced hotel
booking function provides customers with prepayment facilities at
Air Canada's most popular destinations worldwide. Customers will
know the total accommodation cost at the time of booking on this
new service that is supported 24 hours a day, seven days a week.

    Further enhancements to aircanada.com in the coming months

In the coming weeks and months, customers booking at aircanada.com
will enjoy more new or expanded services designed to enhance their
web booking experience.

Effective July 30 Aeroplan Bonus Miles earned by booking  online
at aircanada.com will be available for redemption to customers in
their account within 24 hours. One Aeroplan Bonus Mile is awarded
for every $3 spent on airfare for travel within Canada and is
credited to the account of the customer who makes the online
booking.

By October customers who travel on multi-leg itineraries,
including those journeys that may involve arriving into one city
and leaving from another, will be able to book these types of
itineraries at aircanada.com .

The aircanada.com website will also soon feature group travel
booking capabilities and faster downloading of information.
Enhanced user identification and password administration functions
will soon be available to make travel booking as simple and easy
as possible.

The site enhancements are an element of Air Canada's comprehensive
business strategy focused on providing value and simplicity for
customers. The enhancements are designed to increase customer
usage of the online channel, simplify and automate the customer's
travel experience and further the airline's more efficient, lower
cost business strategy.


AIR CANADA: CIBC Presses for Prompt Execution of Assignment Form
----------------------------------------------------------------
Canadian Imperial Bank of Commerce asks the Court to direct Air
Canada to immediately execute and deliver a form of assignment
with respect to a portion of CIBC's position in a bank syndicate
loan.

Otherwise, CIBC asks Mr. Justice Farley to declare that the
assignment of a portion of its position in the syndicated loan
pursuant to a credit derivative is effective and binding on the
bank syndicate and its agent, Air Canada and the assignee whether
or not Air Canada executes a form of assignment.

Brian McDonough, Senior Vice President, Special Loans, explains
that CIBC is one of the lenders to Air Canada under a syndicated
loan with The Bank of Nova Scotia as agent.  Before the Petition
Date, CIBC purchased a hedge or "credit derivative" in the form
of a right to deliver a portion of its syndicated loan to
Deutsche Bank AG on certain conditions.  Air Canada's CCAA filing
triggered an event of default and caused Deutsche Bank to demand
CIBC's portion of the syndicated loan.  In order to get the
benefit of the Credit Derivative, Mr. McDonough continues, CIBC
must "settle" the transaction by delivering a valid assignment.
CIBC agreed with Deutsche Bank to make the assignment directly to
National Bank of Canada.

"[T]he consent of Air Canada is not required for the assignment
by CIBC to National Bank of Canada as an event of default is
outstanding under the Syndicated Loan," Mr. McDonough says.  The
Assignment Form, however, contemplates Air Canada's signature.
Under the Loan Agreement, Air Canada is required to act reasonably
in executing the Assignment Form.

CIBC delivered to Air Canada and to Nova Scotia an Assignment Form
on May 16, 2003.  On May 23, 2003, Air Canada executed the
Assignment Form as required and returned the executed Form to
CIBC.  For a technical reason, Nova Scotia refused to accept the
Assignment Form.  So CIBC prepared a new version of the Assignment
Form and sent it to Air Canada for execution.

But Air Canada did not respond to CIBC's request that it execute
the second version of the Assignment Form.  David Shapiro, Air
Canada's Assistant General Counsel, later advised CIBC that the
new version would not be executed because National Bank of Canada
may acquire set-off rights as a consequence of the assignment.
But Mr. McDonough notes that such consequence is specifically
contemplated by the loan documentation.  Air Canada also purported
to retract its signature of the earlier version of the Assignment
Form.

Mr. McDonough maintains that because of Air Canada's unreasonable
refusal to execute and deliver the Assignment Form and the delay
in its responses, CIBC is at risk of being severely prejudiced.
CIBC may lose the benefit of the Credit Derivative unless Air
Canada is immediately directed to execute and deliver the
Assignment Form.

                         *     *     *

Mr. Justice Farley declares that the assignment of a portion of
CIBC's position in the Syndicated Loan is effective and binding on
CIBC, National Bank of Canada, Air Canada and The Bank of Nova
Scotia, although that Air Canada has not executed the assignment.
But Mr. Justice Farley clarifies that the assignment does not
create additional set-off rights with respect to the assigned
debts. (Air Canada Bankruptcy News, Issue No. 9; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


AK STEEL: S&P Cuts Ratings to B+ Over Weak Financial Performance
----------------------------------------------------------------
Standard & Poor's Ratings Services has lowered its corporate
credit ratings on integrated steel producer AK Steel Corp. and its
parent, AK Steel Holding Corp. to 'B+' from 'BB-' based on the
company's weaker than expected financial performance. The current
outlook is negative. Middleton, Ohio-based AK Steel has about $1.3
billion in total debt.

"The downgrade reflects AK's weaker than expected financial
performance resulting from difficult conditions in its key market
segments and the expectation that these conditions will continue
to subdue the company's financial performance for the intermediate
term', said Standard & Poor's credit analyst Paul Vastola. "AK's
competitive position has also been weakened by integrated steel
companies that have emerged from bankruptcy and drastically
improved their balance sheets by reducing debt and shedding their
postretirement obligations".

Standard & Poor's said that its ratings on AK Steel reflect its
challenged business position as a mid-size, value-added,
integrated steelmaker, with high exposure to the automotive
market, and burdensome legacy costs, which more than offset its
fair liquidity. AK Steel competes in cyclical, capital-intensive
markets with a focus on the manufacture of flat-rolled carbon,
stainless, and electrical steel.


AMERCO: Court Grants Final Approval of BDO Seidman's Engagement
---------------------------------------------------------------
After conducting the final hearing, U.S. Bankruptcy Court Judge
Zive allows Amerco to employ BDO Seidman as its accountants
pursuant to the Amended May 8, 2003 Engagement Letter that states:

    (a) Immediately under the heading "Dispute Resolution
        Procedure" on page five of the Engagement Letter, this
        language will be added:

        "Any dispute, controversy or claim that arises in
        connection with the performance or breach of this
        agreement shall be resolved by the United States
        Bankruptcy Court for the District of Nevada in
        accordance with the laws of the State of Nevada,
        provided, however, at the request of either party,
        and with the consent of the Bankruptcy Court, such
        dispute, controversy or claim may be resolved
        pursuant to the procedures described below."

    (b) This language in the first paragraph below the heading
        "Dispute Resolution Procedure" on page five of the
        Engagement Letter is removed: "If any dispute,
        controversy or claim arises in connection with the
        performance or breach of this agreement", an will be
        replaced with: "Either party may. . . ."

                         *     *     *

BDO Seidman will render these services:

    (a) Complete the audit of AMERCO's financial statements for
        the fiscal year ended March 31, 2003; and

    (b) Complete the re-audit of AMERCO's financial statements
        for fiscal years ended March 31, 2002 and 2001.

In exchange for the services to be rendered, BDO Seidman will
charge AMERCO on these hourly rates:

    Partners                $450 - 825
    Associates               110 - 350
    Administrative staff            65

BDO Seidman will also seek the reimbursement of out-of-pocket
expenses, including, among other things, long distance telephone
calls, facsimiles, photocopying, postage and package delivery
charges, messengers, court fees, transcript fees, travel expenses,
working meals and computer-assisted research. (AMERCO Bankruptcy
News, Issue No. 3; Bankruptcy Creditors' Service, Inc., 609/392-
0900)


AMERICA WEST HLDGS: S&P Affirms & Removes B- Rating from Watch
--------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its ratings on America
West Holdings Corp. and subsidiary America West Airlines Inc.,
including the 'B-' corporate credit ratings, and removed them from
CreditWatch, where they were placed on March 18, 2003. The outlook
is negative.

"The ratings on America West reflect risks relating to the adverse
airline industry environment, a weak balance sheet, and limited
financial flexibility," said Standard & Poor's credit analyst
Betsy Snyder. "After significant losses incurred since 2001, which
almost resulted in its filing for Chapter 11 bankruptcy
protection, the company finally reported a profit in the second
quarter of 2003, even before the inclusion of an $81 million
refund from the federal government," the credit analyst continued.

America West Holdings' major subsidiary is America West Airlines
Inc., the eighth-largest airline in the U.S, with hubs located at
Phoenix and Las Vegas. America West benefits from a low cost
structure, among the lowest in the industry. However, it competes
at Phoenix and Las Vegas against Southwest Airlines Co., the other
major low-cost, low-fare operator in the industry and financially
the strongest. As a result of the competition from Southwest, as
well as America West's reliance on lower-fare leisure travelers,
its revenues per available seat mile also tend to be among the
lowest in the industry. In addition, America West Holdings owns
the Leisure Co., one of the nation's largest tour packagers.

In January 2002, the company received proceeds from a $429 million
loan, 90% of which was guaranteed by the federal government under
the Air Transportation Stabilization Act, which enabled it to
avert filing for Chapter 11 bankruptcy protection. As part of this
process, the company completed arrangements for over $600 million
in concessions, financing, and other assistance. These actions
have allowed it to maintain its relatively low cost structure
relative to the industry. Although the company has remained
unprofitable since then, it did report a small profit in the
second quarter of 2003, even before the inclusion of an $81
million refund from the federal government, one of only a few U.S.
airlines to have achieved such a feat. However, the company's
financial flexibility is expected to remain weak. Although it had
$465 million of cash and short-term investments at June 30, 2003
(of which $80 million is restricted), it has no bank facilities
and a substantial portion of its assets are encumbered.

The ratings on America West could be lowered if the airline
industry enters a renewed downturn due to further terrorism or a
"double-dip" recession, causing further pressure on America West's
credit profile.


AMES DEPARTMENT: Sues 69 Vendors to Recover Preference Payments
---------------------------------------------------------------
Ames Department Stores, Inc., and its debtor-affiliates seek to
avoid preferential transfers made to 69 creditors.

Barry S. Gold, Esq., at Weil, Gotshal & Manges LLP, in New York,
tells the Court that Sections 547(b) and 550(a) of the Bankruptcy
Code empower a debtor-in-possession, for its estate's benefit, to
avoid and recover any transfer of an interest in property:

    * to or for the benefit of a creditor;

    * for or on account of an antecedent debt owed by the debtor-
      in-possession before the transfer was made;

    * made while the debtor-in-possession was insolvent;

    * made on or within 90 days, or in certain circumstances,
      within one year, before the filing of the petition; and

    * that enables the creditor to receive more in satisfaction of
      its claims than it would receive in a case under chapter 7
      of the Bankruptcy Code if the transfer had not been made.

The Avoidable Transfers were on account of antecedent debts owed
by Ames to these vendors and were made while the Debtors were
insolvent.  The Avoidable Transfers enabled the vendors to
recover more than they would have received if:

    -- the Avoidable Transfers had not been made,

    -- the case were under Chapter 7, and

    -- they received payment of their debt to the extent provided
       by Chapter 11.

Given these justifications, Mr. Gold contends that the Avoidable
Transfers should be avoided and set aside as preferential and the
money transferred should be returned to the Debtors.  The Debtors
are entitled to recover from each of the vendors an amount that
is not less than the total amount of transfers.  Mr. Gold
emphasizes that the recoverable amount should also include
interest and costs.

Thus, the Debtors ask that the Court enter judgment against the
Vendors and direct them to pay to the estate the total amount of
the Avoidable Transfers to be determined at trial.

In May 2003, the Debtors filed individual complaints against 69
defendant-vendors.  During the 90-day period before the Petition
Date, the Debtors made avoidable transfers to these creditors in
these amounts:

       Vendor Name                        Total Check Amount
       -----------                        ------------------
       Audiovox Corp.                            $88,658
       Broilking Corp.                           138,285
       Bush Industries, Inc.                     147,421
       Castlewood Apparel Corp.                  264,682
       Cayset Fashions Ltd.                      107,938
       CHF Industries, Inc.                      290,801
       Chrisha Creations, Ltd.                   142,752
       Citgo Petroleum Corp.                     130,940
       Cliff Weil Inc.                           142,931
       Commonwealth Wholesale Corp.              477,867
       Conley National, Inc.                     123,355
       Cosmi Corp.                               410,012
       Dart Distributing LLC                     404,528
       E. Mishan & Sons, Inc.                    145,268
       ESS-Hanes Her Way                         218,155
       Etna Products Co., Inc.                   100,367
       Fleximat Corp.                            326,322
       Franco Manufacturing Company, Inc.        460,947
       General Mills, Inc.                       105,750
       Hedstrom Corp.                            101,920
       Huffy Bicycle Company                     609,975
       IC Isaacs & Company L.P.                   97,009
       Jeri Jo, Inc.                             105,224
       Kantor Bros. Neckwear Co., Inc.            91,483
       Kazi Sportswear, Inc.                     313,332
       Kent (Bicycles) Int'l, Inc.               247,212
       Kent Sporting Goods, Inc.                 207,585
       Klear-Vu Corp.                            108,644
       Kraco Enterprises, Inc.                   147,963
       Leen & Associates, Inc.                   146,517
       L'eggs Products, Inc.                     102,714
       Lifetime Products, Inc.                   102,249
       Lynk, Inc.                                117,018
       Magnivision, Inc.                          96,387
       Matisse Jewelry, Inc.                      90,869
       Maurice Sporting Goods, Inc.              689,486
       McCormick & Company, Inc.                 121,351
       Merisant Co.                              158,787
       Metal Fusion, Inc.                        505,323
       Notions Marketing                         577,494
       Opus, Inc.                                133,054
       Peaches Uniforms, Inc.                    129,299
       Pepsi-Cola Buffalo Bottling Corp.          98,685
       Pepsi-Cola Company Winston Salem          797,165
       Presto Products Company                   442,191
       Pro-Mart Industries, Inc.                 110,746
       Purity Foods, Inc.                        205,945
       Quaker Oats Company                       126,947
       Quick Response Marketing, Inc.            486,338
       Radio Flyer, Inc.                         141,362
       Sandalwood Apparel Corp.                  870,351
       Singer Sewing Company                     334,629
       Smart Inventions, Inc.                    127,771
       Spectra Merchandising Int'l, Inc.         231,225
       TDK Electronics Corp.                     318,375
       Terrisol Corp.                            115,062
       Teters Floral Products, Inc.              336,219
       T-Fal Corp.                               637,241
       The Greene Company                        397,204
       The Hilasal Company                       427,730
       The Holson Company                        609,341
       The Hoover Company                        559,485
       Thomson Consumer Electronics, Inc.        434,267
       Todd Harvey Associates, Inc.              148,335
       TracFone Wireless, Inc.                   110,996
       Trend Zone, Inc.                          130,111
       Unical Enterprises, Inc.                  938,550
       Whittier Wood Products                    463,998
       Wynit, Inc.                               114,018
(AMES Bankruptcy News, Issue No. 40; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


ANTARES PHARMA: Completes Second $2MM Private Equity Placement
--------------------------------------------------------------
Antares Pharma, Inc. (OTC Bulletin Board: ANTR) has completed the
second tranche of a planned $4.0 million private placement of
common equity.  The second tranche of $2.0 million was under the
same terms as the equity placement announced on July 9, 2003, and
was also priced at the $1.00 value of Antares Pharma's shares as
of the close of business on July 3, 2003.  The participants in
this tranche of the financing include SCO Capital Partners LLC,
North Sound Legacy Funds, and Vertical Ventures Investments LLC.
SCO Securities LLC acted as the placement agent.

Lawrence Christian, Chief Financial Officer of Antares Pharma,
said, "This equity placement provides further working capital
needed to support our ongoing operations and to secure additional
technology license agreements. After the completion of this sale
of equity, we estimate our cash position, when combined with our
plans to further reduce our monthly cash burn, will provide
operating capital well into 2004."

Antares Pharma develops pharmaceutical delivery systems, including
needle-free and mini-needle injector systems and transdermal gel
technologies. These delivery systems are designed to improve both
the efficiency of drug therapies and the patient's quality of
life.  The Company currently distributes its needle-free injector
systems in more than 20 countries.  In addition, Antares Pharma
conducts research and development with transdermal gel products
and currently has several products in clinical evaluation with
partners in the US and Europe.  The Company is also conducting
ongoing research to create new products that combine various
elements of the Company's technology portfolio.  Antares Pharma
has corporate headquarters in Exton, Pennsylvania, with
manufacturing and research facilities in Minneapolis, Minnesota,
and research facilities in Basel, Switzerland.

Antares Pharma's March 31, 2003 balance sheet shows a working
capital deficit of about $4 million and a total shareholders'
equity deficit of about $3 million.


ARMSTRONG: Maertin Plaintiffs' Suit Settlement Drawing Fire
-----------------------------------------------------------
Marc S. Casarino, Esq., at White & Williams in Wilmington,
representing International Insurance Company, U.S. Fire Insurance
Company and Cravens Dargan Co., Pacific Coast, as managing general
agent for Central National Insurance Co. of Omaha, objects to the
Motion to Approve Settlement filed by the Maertin Plaintiffs, and
requests adequate protection of the ACE Insurers' rights and
interests.

Prior to the Petition Date, the ACE Insurers issued certain
insurance policies to Armstrong World Industries, Inc., including
various excess liability policies.  The ACE Insurers hold claims
against the Debtors, are parties-in-interest in the bankruptcy
case, and are defendants in the direct action filed by the Maertin
Plaintiffs.

                          The Objections

The ACE Insurers object to the Settlement Motion to the extent
that the provisions of the proposed settlement attempt to bind the
ACE Insurers or in any way alter, impair or otherwise affect their
rights, claims and defenses under the ACE Excess Policies.
Subject to the granting of certain adequate protection of the ACE
Insurers' rights, the ACE Insurers do not object to the Debtors'
entry into the settlement. Rather, the ACE Insurers request
protection of their rights and interests as provided in a proposed
order approving the settlement without prejudice to the ACE
Insurers.

Furthermore, the subject-matter of the proposed settlement -- the
Maertin Plaintiffs' bad faith claims against AWI and its primary
insurer, Liberty Mutual, and direct action claims against AWI's
primary and excess insurers (including the ACE Insurers) seeking
insurance coverage for AWI's pre-petition agreement to pay a $7
million settlement -- is presently being litigated before the
Honorable Jerome B. Simandle in the United States District Court
for the District of New Jersey, Camden Vicinage, in an action
captioned Maertin et al. v. Armstrong World Industries, Inc.,
Liberty Mutual Group et al.  The Bankruptcy Court lacks
jurisdiction to determine, alter, impair or otherwise affect the
rights, claims and defenses of the ACE Insurers under the ACE
Excess Policies or in the NJ Direct Action in connection with the
requested approval of the proposed settlement.  Accordingly,
approval of the proposed settlement, if any, must be without
prejudice to the rights of the ACE Insurers.

The Maertin Plaintiffs' Settlement Motion seeks approval of a
Settlement Agreement and Release dated March 6, 2003, among the
Maertin Plaintiffs, Liberty Mutual and AWI.  This Second
Settlement Agreement is not only contingent upon Bankruptcy Court
approval, but also approval by District Judge Simandle in the NJ
Direct Action.  United States Magistrate Judge Rosen scheduled a
hearing in the NJ Direct Action to consider approval of the Second
Settlement Agreement, and directed the parties to confer in person
beforehand to address any matters relating to that settlement.

As the Maertin Plaintiffs acknowledge, the Second Settlement
Agreement is only a "partial" settlement. It does not resolve all
of the claims and issues among the parties to the Second
Settlement Agreement, including especially the allocation and
trigger issues pending before District Judge Simandle in the NJ
Direct Action.  Mr. Casarino describes the Maertin Plaintiffs'
summary of the Second Settlement Agreement in their Settlement
Motion as "bare bones" and "misleading." He believes that the
Second Settlement Agreement "targets and could prejudice the
rights of Armstrong's excess insurers" in the NJ Direct Action,
including the ACE Insurers' rights and defenses under the ACE
Excess Policies.

Under the Second Settlement Agreement, in exchange for Liberty
Mutual's $3 million payment to the Maertin Plaintiffs, $2 million
of which is to be allocated to a particular Liberty Mutual primary
policy, the Maertin Plaintiffs agree to forebear from prosecuting
their claims for the $4 million balance of the settlement against
either the Debtors or Liberty Mutual.  Instead, the Maertin
Plaintiffs agree to first proceed against the excess insurers in
the NJ Direct Action. In the event that the excess insurers are
not found liable for the balance of the settlement in the NJ
Direct Action, however, the Maertin Plaintiffs may pursue their
claims for the remaining settlement amount against AWI (albeit in
the bankruptcy case) and Liberty Mutual.

The Second Settlement Agreement seeks to saddle the excess
insurers with the burden of paying the remaining $4 million of the
settlement, despite Liberty Mutual's apparent agreement to
originally fund the entire settlement amount and despite the fact
that Liberty Mutual's primary policies, if properly exhausted,
would provide coverage for the entire $7 million amount.

The Second Settlement Agreement preserves the rights of the
Debtors and Liberty Mutual to contest the manner in which the
remaining $1 million dollar payment by Liberty Mutual is to be
allocated.  Nothing in the Second Settlement Agreement provides
that the provisions of the proposed settlement are not binding
upon, and are without prejudice to, the excess insurers' rights in
the NJ Direct Action.

The Second Settlement Agreement further provides that the
Bankruptcy Court "shall have jurisdiction over the settlement for
purposes of enforcing this Settlement Agreement and adjudicating
disputes that may arise over payment made in connection with this
Settlement Agreement," except that the Bankruptcy Court shall not
have jurisdiction to adjudicate certain disputes relating
primarily to the allocation of Liberty Mutual's $3 million
settlement payment (as the parties presumably agree that these
issues shall be determined by Judge Simandle in the NJ Direct
Action).

The ACE Insurers object to the Second Settlement Agreement to the
extent that the same may be deemed binding upon non-parties such
as the ACE Insurers or to the extent that any order approving the
Settlement Motion would constitute a finding, ruling or judgment
by the Bankruptcy Court that the provisions in the Second
Settlement Agreement are binding upon the excess carriers or in
any way alter, impair or otherwise affect their rights, claims and
defenses.

                           No Jurisdiction

Mr. Casarino insists that the Bankruptcy Court has no jurisdiction
to approve the Second Settlement Agreement as binding upon the ACE
Insurers.  First, the ACE Insurers are not parties to the Second
Settlement Agreement. Second, the rights, claims and defenses
among the Maertin Plaintiffs, Liberty Mutual and the excess
insurers, all non-debtor parties, are presently the subject of the
litigation pending before Judge Simandle in the NJ Direct Action.
As such, the NJ Direct Action is the appropriate forum to
determine the extent to which there is sufficient insurance
coverage under Armstrong's primary policies issued by Liberty
Mutual to cover the entire settlement amount. The fact that the
Maertin Plaintiffs, Armstrong and Liberty Mutual have
conditionally agreed to settle for an amount less than the full
limits of Armstrong's primary policies cannot bind or impair the
rights of the excess insurers in the NJ Direct Action or otherwise
alter or expand the contractual rights and obligations under their
excess policies.

For similar reasons, the proposed settlement cannot bind, impair
or otherwise affect the ACE Insurers' rights in the NJ Direct
Action or in the ACE Insurers' Appeal to argue that the Maertin
Plaintiffs' failure to proceed directly against AWI to collect the
settlement, as authorized by Judge Farnan's Order, precludes their
claims against the excess insurers under the NJ Anti-Direct Action
Statute.

Finally, the jurisdictional provisions in the proposed settlement
cannot bind the ACE Insurers or expand or pre-decide the
Bankruptcy Court's jurisdiction beyond that authorized by law.
Any approval of the Second Settlement Agreement should not confer
upon the Bankruptcy Court jurisdiction to determine any rights,
claims and/or defenses of the ACE Insurers or in the NJ Direct
Action, under the guise of enforcing the Second Settlement
Agreement.

                  Request For Adequate Protection

The Second Settlement Agreement may be approved by the Bankruptcy
Court only if it is without prejudice to the rights, claims and
defenses of the ACE Insurers in the NJ Direct Action and any other
action or proceeding now or hereinafter instituted relating to the
claims of the Maertin Plaintiffs.  The ACE Insurers request
adequate protection of such rights, claims and defenses pursuant
to the terms and conditions set forth in their proposed form of
order. Any approval of the Second Settlement Agreement should be
made expressly subject to such terms and conditions in order to
protect the due process rights of the ACE Insurers.

The ACE Insurers reserve their rights to amend, modify or
supplement (by further objections affidavit or otherwise) these
Objections. Moreover, by filing these Objections, the ACE Insurers
do not waive, and expressly reserve, all of their rights,
defenses, claims and/or exclusions under the ACE Excess Policies,
applicable law or otherwise. The ACE Insurers further reserve the
right to assert any and all such rights, defenses, claims and/or
exclusions in any appropriate manner or forum whatsoever.

                        *   *   *

OneBeacon Insurance Company, formerly CGU Group, successor by
merger to Potomac Insurance Company, which allegedly issued
certain excess catastrophe liability policies to Armstrong World
Industries, Inc., represented by Kevin J. Connors, Esq., at
Marshall, Dennehey, Warner, Coleman & Goggin in Wilmington, joins
in the Objections of the ACE Insurers to the Maertin Plaintiffs'
Motion to Approve Settlement and the related Request for Adequate
Protection.  In joining International's Objections and Request,
Mr. Connors says that OneBeacon relies upon and adopts the
arguments set forth by International. (Armstrong Bankruptcy News,
Issue No. 44; Bankruptcy Creditors' Service, Inc., 609/392-0900)


ARVINMERITOR INC: Dana's Board Rejects Unsolicited Tender Offer
---------------------------------------------------------------
Dana Corporation's (NYSE: DCN) Board of Directors has rejected an
unsolicited tender offer from ArvinMeritor, Inc. (NYSE: ARM) after
a thorough review and consultation with its legal and financial
advisors. On July 9, 2003, ArvinMeritor launched a tender offer
for all outstanding shares of Dana common stock at a price of
$15.00 per share.

Dana filed a Schedule 14D-9 with the Securities and Exchange
Commission recommending that its shareholders not tender their
stock in response to this offer.

The Board stated as reasons for its recommendation that
ArvinMeritor's offer is a financially inadequate, high-risk
proposal that is not in the best interests of Dana or its
shareholders. In addition, the Board cited the significant
financing risks and serious antitrust concerns raised by the offer
that could prevent its completion.

The Board said in its response that:

- ArvinMeritor's offer was inadequate, from a financial point of
  view, to holders of Dana common stock, as indicated in the
  opinions, dated July 21, 2003, that the Board of Directors
  received from its financial advisors, Credit Suisse First Boston
  LLC and Deutsche Bank Securities Inc.

- Dana's restructuring and transformation efforts are producing
  results. Management has reported these results to the Board, and
  both have reaffirmed their belief that the Company's ongoing
  strategy is a better way to enhance value for shareholders.
  Management and the Board also believe that Dana's strategy is
  meeting its targets to deliver improved financial performance
  for the remainder of 2003, 2004 and beyond - performance that
  they believe is not yet reflected in the current stock price.

- Dana has already achieved success in executing its restructuring
  plan as evidenced by improved earnings, the generation of $540
  million in proceeds from asset sales, and the reduction of net
  debt by approximately $590 million over the past 18 months
  (excluding approximately $710 million in asset sales and $580
  million in debt reduction attributable to Dana Credit
  Corporation's disposition activities over the same period of
  time).

- ArvinMeritor's proposed transaction raises serious antitrust
  issues and is very likely to attract intensive scrutiny from
  government antitrust authorities, which may result in litigation
  to block the offer. For example, Dana and ArvinMeritor are the
  only substantial North American producers of axles, driveshafts,
  and foundation brakes for medium- and heavy-duty trucks, with
  combined market shares ranging from 80 percent to 100 percent.
  ArvinMeritor has not yet even begun the process of seeking
  antitrust clearance by making the required filing under the
  Hart-Scott-Rodino Act.

- Although ArvinMeritor would need to arrange substantial
  borrowings to consummate its offer, when confronted by
  securities regulators from the State of Ohio, ArvinMeritor
  stated that it has not entered into any commitments or
  agreements to obtain any such financing. Based on ArvinMeritor's
  public disclosures, the size of the required financing would
  result in ArvinMeritor having an approximately 88% pro forma
  debt-to-capital ratio, which would be among the highest in the
  automotive supply industry.

- ArvinMeritor's offer is highly conditional, which creates
  significant uncertainty that the offer could ever be completed.

Dana Corporation Chairman and CEO Joe Magliochetti said, "There is
virtually no rationale for accepting this offer, which represents
inadequate value and a high level of risk for shareholders.

"We are confident that with the substantial completion of our
restructuring, the critical momentum we are beginning to achieve
in our transformation process, our market leadership and the
expected cyclical upward turn in our heavy-duty markets, we are
positioned to outperform our peers as the industry recovers. We
are confident that as we go forward, the benefits of our
restructuring will enhance shareholder value."

Dana Corporation also has retained Goldman, Sachs & Co. as a
financial adviser in connection with this matter.

Dana is a global leader in the design, engineering, and
manufacture of value-added products and systems for automotive,
commercial, and off-highway vehicle manufacturers and their
related aftermarkets. The company employs approximately 60,000
people worldwide. Founded in 1904 and based in Toledo, Ohio, Dana
operates hundreds of technology, manufacturing, and customer
service facilities in 30 countries. The company reported 2002
sales of $9.5 billion.

ArvinMeritor, Inc. is a premier $7-billion global supplier of a
broad range of integrated systems, modules and components to the
motor vehicle industry.  The company serves light vehicle,
commercial truck, trailer and specialty original equipment
manufacturers and related aftermarkets.  In addition, ArvinMeritor
is a leader in coil coating applications.  The company is
headquartered in Troy, Mich., and employs 32,000 people at more
than 150 manufacturing facilities in 27 countries.  ArvinMeritor
common stock is traded on the New York Stock Exchange under the
ticker symbol ARM.  For more information, visit the company's Web
site at: http://www.arvinmeritor.com

As previously reported in Troubled Company Reporter, Standard &
Poor's Ratings Service placed its 'BB+' corporate credit and
senior unsecured debt ratings on ArvinMeritor Inc. on CreditWatch
with negative implications. In addition, Standard & Poor's placed
its 'BB' corporate credit and senior unsecured debt ratings on
Dana Corp., on CreditWatch with negative implications.

Fitch Ratings also downgraded the ratings of ArvinMeritor Inc.'s
senior unsecured debt to 'BB+' from 'BBB-' and capital securities
to 'BB-' from 'BB+' and placed the Ratings on Watch Negative. The
downgrade reflects ARM's intent to acquire growth through debt
financed acquisitions and a willingness to substantially raise the
leverage in its capital structure. If the transaction is completed
on the proposed terms, further rating action is expected. New
financing for the transaction is likely to be on a secured basis,
further impairing unsecured debt holders. The ratings have been
placed on Rating Watch Negative.


ARVINMERITOR: Voices Commitment to Offer to Acquire Dana Shares
---------------------------------------------------------------
ArvinMeritor, Inc. (NYSE: ARM) issued the following statement in
response to Dana Corporation's (NYSE: DCN) announcement that its
Board of Directors has recommended that its shareowners reject
ArvinMeritor's cash tender offer to acquire all of Dana's
outstanding common stock for $15.00 net per share.

ArvinMeritor stated: "Despite the fact that the Dana Board has
rejected our all-cash tender offer and refuses to negotiate with
us, we are committed to this transaction.  Our offer permits
Dana's shareowners to realize an attractive cash value for their
shares today without bearing the risks of Dana's long-term
restructuring efforts.

"We believe Dana's Board and management team has failed to seize
this unique opportunity to maximize value for its shareowners.  As
we have indicated previously, if Dana's Board is willing to work
with us to consummate a transaction quickly, we may be prepared to
analyze further whether a higher value is warranted.  In addition,
because it remains our strong preference to work together with the
Dana Board, we are flexible in considering a mix of cash and stock
consideration if it will facilitate a transaction.

"We believe that Dana's response recites a litany of manufactured
reasons to oppose this combination.  We are confident that there
is not one issue listed in today's press release by Dana that
cannot be resolved."

As previously announced, on July 9, 2003, ArvinMeritor commenced a
cash tender offer for all of the outstanding common shares of Dana
common stock for $15.00 net per share.  The tender offer and
withdrawal rights are scheduled to expire at 5:00 p.m., on
August 28, 2003, unless extended.

ArvinMeritor's offer represents a premium of 56% over Dana's
closing stock price on June 3, 2003, the last trading day before
ArvinMeritor submitted its first proposal to Dana in writing, a
premium of 39% over Dana's average closing stock price for the 30
trading days before ArvinMeritor publicly announced its intention
to commence a tender offer, and a premium of 25% over Dana's
closing stock price on July 7, 2003, the last trading day before
ArvinMeritor publicly announced its intention to commence a tender
offer.

UBS Investment Bank is acting as financial advisor and dealer
manager, Gibson, Dunn & Crutcher LLP is acting as legal counsel
and MacKenzie Partners, Inc. is acting as information agent for
ArvinMeritor's offer.

ArvinMeritor, Inc. is a premier $7-billion global supplier of a
broad range of integrated systems, modules and components to the
motor vehicle industry.  The company serves light vehicle,
commercial truck, trailer and specialty original equipment
manufacturers and related aftermarkets.  In addition, ArvinMeritor
is a leader in coil coating applications.  The company is
headquartered in Troy, Mich., and employs 32,000 people at more
than 150 manufacturing facilities in 27 countries.  ArvinMeritor
common stock is traded on the New York Stock Exchange under the
ticker symbol ARM.  For more information, visit the company's Web
site at: http://www.arvinmeritor.com

As previously reported in Troubled Company Reporter, Standard &
Poor's Ratings Service placed its 'BB+' corporate credit and
senior unsecured debt ratings on ArvinMeritor Inc. on CreditWatch
with negative implications. In addition, Standard & Poor's placed
its 'BB' corporate credit and senior unsecured debt ratings on
Dana Corp., on CreditWatch with negative implications.

Fitch Ratings also downgraded the ratings of ArvinMeritor Inc.'s
senior unsecured debt to 'BB+' from 'BBB-' and capital securities
to 'BB-' from 'BB+' and placed the Ratings on Watch Negative. The
downgrade reflects ARM's intent to acquire growth through debt
financed acquisitions and a willingness to substantially raise the
leverage in its capital structure. If the transaction is completed
on the proposed terms, further rating action is expected. New
financing for the transaction is likely to be on a secured basis,
further impairing unsecured debt holders. The ratings have been
placed on Rating Watch Negative.


BAYOU STEEL: Hires Valuation Research as Valuation Consultants
--------------------------------------------------------------
Bayou Steel Corporation and its debtor-affiliates sought and
obtained approval from the U.S. Bankruptcy Court for the Northern
District of Texas to employ Valuation Research, an appraisal firm,
to perform an evaluation of the company's business operations. The
Debtors believe that Valuation Research is well qualified to
provide the necessary services and that it would be most efficient
and in the best interest of their estates that Valuation Research
be employed.

The services that the Debtors expect Valuation Research to render
include:

     (a) appraisal inspection, investigation and analysis of
         fixed assets and records related to such assets;

     (b) appraisal related data, information gathering, market
         research and other related activities;

     (c) appraisal report preparation; and

     (d) confer, advise and discuss our specific appraisal of
         BSC assets, appraisal methodology and witness
         preparation, depositions and defense of any litigation
         related to these matters.

The hourly billing rates for professionals at Valuation Research
range from $150 per hour to $280 per hour. The professionals most
likely to perform the majority of the work on the Debtors' case
and their current hourly rates are:

     Joseph Mickle      Director            $280 per hour
     James Farlow       Sr. Vice President  $250 per hour
     Michael Ardizzone  Staff Appraiser     $150 per hour
     Neil Thompson      Sr. Vice President  $250 per hour
     Dave Unger Staff   Appraiser           $150 per hour
     Neil C. Kelly      Chairman            $300 per hour

Bayou Steel Corp., a producer of light structural shapes and
merchant bar steel products, filed for chapter 11 protection on
January 22, 2003 (Bankr. N.D. Tex. 03-30816).  Patrick J. Neligan,
Jr., Esq., at Neligan, Tarpley, Andrews & Foley, LLP, represents
the Debtors in their restructuring efforts.  When the Company
filed for protection from its creditors, it listed $176,113,143 in
total assets and $163,402,260 in total debts.


BAY VIEW CAPITAL: Reports $410 Million Net Assets in Liquidation
----------------------------------------------------------------
Bay View Capital Corporation (NYSE: BVC) reported net assets in
liquidation of $409.9 million, or $6.37 in net assets in
liquidation per outstanding share at June 30, 2003 as compared to
$411.0 million, or $6.41 in net assets in liquidation per
outstanding share at March 31, 2003.

During the third quarter of 2002, the Company adopted liquidation
basis accounting as a result of its stockholders' approval of a
plan of dissolution and stockholder liquidity and subsequent
completion of the sale of its retail banking assets to U.S. Bank,
N.A. In accordance with accounting principles generally accepted
in the United States of America, under the liquidation basis of
accounting, the Company is now reporting the value of, and the
changes in, net assets available for distribution to stockholders
instead of results from continuing operations.

The second quarter decrease in net assets in liquidation was
primarily the result of dividends paid on the Capital Securities
which was in excess of income from operations. The proceeds from
stock options and warrants exercised during the quarter totaled
$0.6 million as compared to $2.6 million during the first quarter.
Net income from operations was $0.6 million for both the second
quarter and the first quarter of 2003.

The net income from operations for the second quarter consisted of
$0.7 million of pre-tax income from operations, $0.9 million of
net charges for liquidation valuation adjustments which were
largely attributable to writedowns on the auto lease and
liquidating loan portfolios, and a tax benefit of $0.8 million.

"Despite the $0.9 million of charges for the liquidation valuation
adjustments and a challenging business and economic environment,
our second quarter results were better than plan," commented John
Okubo, CFO of Bay View Capital Corporation. "This was largely
attributable to better yield on our liquidating loan portfolio
which resulted in favorable interest income."

A comparison of pro-forma net assets in liquidation, adjusted for
estimated after-tax earnings from the Company's remaining
operations and an estimated after-tax gain on Bay View Acceptance
Corporation, the Company's auto finance company, is set forth
below. This pro-forma measure contains projections of future
earnings and the after-tax gain in BVAC, and is a non-GAAP
measure. The Company believes this is a more comprehensive measure
of the economic value of the Company's net assets in liquidation.

At June 30, 2003, total assets were $593 million as compared to
$595 million at March 31, 2003 and $876 million at December 31,
2002. The Company continues to have significant liquidity. At
June 30, 2003, cash and cash equivalents totaled $82.6 million.

During the quarter, the Company received $19.2 million of loan
repayments in its liquidating loan portfolio. These loan
repayments were comprised of $9.6 million of asset-based loans,
$5.8 million of syndicated loans and $3.8 million of other loans.
At June 30, 2003, the Company's remaining investment in loans to
be liquidated was reduced to $49.2 million from $73.8 million at
March 31, 2003.

Total nonperforming assets, net of mark-to-market valuation
adjustments declined to $19.8 million at June 30, 2003 from $22.0
million at March 31, 2003. Franchise related nonperforming assets
declined to $15.9 million at June 30, 2003 from $17.5 million at
March 31, 2003.

Total loans and leases delinquent 60 days or more at June 30, 2003
also declined -- to $2.8 million from $8.3 million at March 31,
2003. Delinquent franchise related loans were $1.9 million at June
30, 2003 as compared to $6.8 million at March 31, 2003. During the
quarter, we transferred $5.9 million of nonperforming franchise
loans to real estate owned and recognized a loss of $0.5 million.

BVAC purchased $73.6 million of auto installment contracts on new
and used vehicles for the quarter, compared to $71.6 million for
the first quarter of 2003. Second quarter purchases were slightly
below expectations. During the quarter, auto manufacturers
continued to offer sales incentives, including below-market auto
financing programs, at a record pace.

Second quarter purchases consisted of 2,621 contracts with
weighted average contract rates of 8.50% and weighted average FICO
scores of 730. At June 30, 2003, BVAC was servicing 33,700
contracts representing $590 million as compared to 35,200
contracts representing $602 million at March 31, 2003.

During the quarter, BVAC completed a study of its loan production
and servicing operations, and identified a number of opportunities
to increase efficiencies without compromising existing
underwriting and servicing standards. To this end, the Chicago and
Houston loan production offices are being consolidated into the
Covina, California office. In addition, BVAC is reducing the size
of its loan servicing and collections staff while expanding its
lending operations from five to seven days per week. Headcount,
which was 141 full-time equivalent employees at June 30, 2003, is
expected to be reduced to approximately 110 by September 30, 2003.
As a result of this restructuring, BVAC anticipates reducing
operating expenses by $1.5 million on an annualized pre-tax basis.
Second quarter results include a pre-tax charge of $675 thousand
for the costs of the restructuring.

As previously announced, BVAC closed a $250 million revolving
receivables warehouse credit facility during the quarter. The
facility, provided by Sheffield Receivables Corporation, an asset-
backed commercial paper vehicle sponsored by Barclays Bank, PLC,
will be used to fund BVAC's purchases and warehousing of
installment contracts. Borrowings will be repaid with the proceeds
from securitizations or sales of installment contracts. During the
third quarter, BVAC anticipates closing its first securitization
of 2003 with an offering of approximately $200 million.

On June 30, 2003, Bay View Bank, N.A., a wholly-owned subsidiary
of the Company, commenced a Plan of Dissolution and Liquidation
under which the Bank will sell all of its assets, satisfy or
discharge all of its known and currently due and payable
liabilities and distribute the remaining proceeds to the Company,
the Bank's sole shareholder. Under this plan, persons that may
have claims that are not currently due and payable or are
otherwise contingent will have such claims satisfied or discharged
by the Bank or such claims will be assigned to and assumed by the
Company. The dissolution and liquidation of the Bank is
contemplated by the Plan of Dissolution and Stockholder Liquidity
which was approved by the Company's stockholders on October 3,
2002. The Company currently anticipates completing the dissolution
of the Bank during the fourth quarter of 2003.

As discussed above, the Company adopted liquidation basis
accounting effective September 30, 2002. Accordingly, the
Company's consolidated financial statements for periods subsequent
to September 30, 2002 have been prepared under the liquidation
basis of accounting including the replacement of the Consolidated
Statement of Operations and Comprehensive Income with the
Consolidated Statement of Changes in Net Assets in Liquidation.
The Company's consolidated financial statements presented for
periods prior to September 30, 2002, (i.e., for the quarter ended
June 30, 2002) are presented on a going concern basis of
accounting. The Company is providing, herein, (1) Consolidated
Statements of Net Assets (Liquidation Basis) as of June 30, 2003
and December 31, 2002, (2) Consolidated Statements of Changes in
Net Assets in Liquidation (Liquidation Basis) for the three months
ended June 30, 2003 and March 31, 2003 and the six months ended
June 30, 2003 and (3) Consolidated Statements of Operations and
Comprehensive Income (Loss) for the three- and six-month periods
ended June 30, 2002 (Going Concern Basis).

Bay View Capital Corporation is a financial services company
headquartered in San Mateo, California and is listed on the NYSE:
BVC. For more information, visit http://www.bayviewcapital.com

As previously reported in Troubled Company Reporter, Standard &
Poor's Ratings Services withdrew all its ratings on Bay View
Capital Corp., and its subsidiaries (including Bay View Bank
N.A.) except the 'B-' preferred stock rating on its subsidiary,
Bay View Capital Trust I. These ratings were withdrawn as the
company liquidates itself.


BENCHMARK ELEC.: Stable Profitability Spurs S&P to Up Ratings
-------------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit and
senior secured debt ratings on Benchmark Electronics Inc. to 'BB-'
from 'B+' and its subordinated debt rating to 'B' from 'B-'.

"The upgrade reflects Benchmark's stable profitability and
improved credit measures, despite weak end markets in the highly
competitive electronic manufacturing services sector," said credit
analyst Edward O'Brien.

The outlook is stable. Angleton, Texas-based Benchmark provides
EMS primarily in the high-end computing and communications
equipment markets. As of March 2003, total debt was about $158
million (operating lease adjusted).

Ratings reflect the company's mid-tier industry position,
significant customer concentration, and challenges posed by weak
electronics end markets. These concerns are offset in part by
consistent operating performance, strong contractual relationships
with leading original equipment manufacturers, and a moderately
leveraged financial profile.

Despite challenging industry conditions, operating margins have
remained between 6% and 7% since fiscal 1999. Credit measures
improved, largely aided by a $110 million equity issue in April
2002, as well as good cash flow generation, which led to modest
debt reduction and increased financial flexibility.

Sales for the 12 months ended March 2003 increased to about $1,750
million from about $1,174 million for the previous 12-month
period.

The company has ample liquidity--cash balances of about $322
million as of March 2003 were more than double the total debt.
Benchmark generated $201 million in free operating cash flow in
the 12 months ended March 2003 and is expected to continue to
generate free operating cash flow over the near term based on
continued profitability and moderate capital expenditure levels.
Additional financial flexibility is provided by full availability
of its $175 million revolving credit facility. Term loan debt
maturities of about $22 million in 2003 are manageable.


BUDGET GROUP: Plan Filing Exclusivity Extended Until August 1
-------------------------------------------------------------
Since the Petition Date, the Budget Group Debtors:

    1. negotiated and received approval for three highly complex
       postpetition financing facilities providing for
       $2,000,000,000 financing;

    2. negotiated and consummated the North American Sale,
       including the assumption and assignment of more than 7,000
       contracts;

    3. negotiated and received approval for a complicated and
       critical settlement with their surety bond provider;

    4. negotiated and consummated the EMEA Sale, which included
       the assumption of certain of the obligations outstanding
       under the EMEA DIP Facility and the analysis and resolution
       of numerous issues arising under various foreign non-
       bankruptcy laws;

    5. managed critical vendor relationships with airports and
       other critical vendors;

    6. performed all the tasks required by the Chapter 11 process
       including noticing and reporting;

    7. coordinated and managed the various post-closing issues
       related to the North American Sale and EMEA Sale;

    8. established a Claims Bar Date;

    9. initiated a process for the reconciliation and resolution
       of the various claims made against the Debtors' estates;
       and

   10. engaged in discussions with various parties-in-interest
       regarding the development and execution of a Chapter 11
       plan.

More recently, the Debtors, with the assistance of their
professionals, have:

    1. developed and begun implementing a cooperative plan with
       the Committee for the reconciliation and resolution of the
       $5,000,000,000 in claims made against their estates;

    2. developed and discussed with the Committee and the U.K.
       Administrator a plan for resolving the allocation and other
       intercompany issues existing among the non-BRACII Debtors
       and BRACII;

    3. facilitated discussions between the Committee and the U.K.
       Administrator regarding the allocation and other
       intercompany issues;

    4. discussed and negotiated with the Committee and U.K.
       Administrator the framework for a Chapter 11 plan for the
       Debtors, including BRACII; and

    5. continued attending to the various post-closing issues
       involved with the North American Sale and the EMEA Sale,
       including proceeding with the litigation against Cherokee
       Acquisition Corporation and Cendant Corporation and
       continuing to administer their estates.

                Claims Management and Reconciliation

Robert S. Brady, Esq., at Young Conaway Stargatt & Taylor LLP, in
Wilmington, Delaware, informs the Court that since April 30, 2003
Bar Date, the Debtors, with the Committee's assistance, have
begun the complex process of analyzing, reconciling and resolving
the $5,000,000,000 scheduled and filed claims against their
estates and the treatment of those various claims.  Among other
things, the Debtors and their professionals have begun the
process of comparing over 4,900 claims asserted against the
Debtors' estates with the claims assumed in connection with the
North American Sale and have prepared and circulated to the
Committee a draft objection to certain duplicative claims and
claims that properly reflect equity interests.  The Debtors have
provided the Committee with an analysis of contract rejection
claims related to contracts that were rejected pursuant to the
North American Asset and Stock Purchase Agreement as well as a
partial analysis of the over 1,300 litigation claims filed
against their estates.  Additionally, the Debtors and their tax
advisors are working through the 1,300 tax-related claims and
continue to interact with the various taxing authorities
regarding audit requests and tax assessments.

            Allocation and Other Intercompany Issues

Both of the Sales were structured as going concern sales of
assets held by numerous Debtor entities in different parts of the
world and, with respect to the EMEA Sale, in various judicial
insolvency proceedings, resulting in gross proceeds realized for
assets belonging to the U.S. Debtors and BRACII.  No allocation
of the Sale Proceeds was made among the estates prior to or at
the closing of the Sales.  To make distributions on account of
valid claims against the various Debtor entities, it is necessary
to allocate the Sale Proceeds between the U.S. Debtors and
BRACII.  The Debtors have worked to facilitate a process by which
the allocation of the Sale Proceeds could be accomplished
consensually among the parties.  To this end, the Committee
submitted to the U.K. Administrator a proposal for settling the
allocation of the Sale Proceeds.  The U.K. Administrator is
currently formulating its response to that proposal.

In addition to the allocation of the Sale Proceeds, potential
intercompany claims exist between BRACC and BRACII arising from a
certain license agreement and their business relationships both
prior and subsequent to the Petition Date.  The determination of
the validity, magnitude and priority of these claims could
significantly impact distributions to creditors of the U.S
Debtors and BRACII.

The outstanding allocation and other intercompany issues are
complex and involve many competing interests and a foreign
insolvency process.  The Debtors, the Committee and the U.K.
Administrator have invested and continue to invest significant
time attempting to resolve these issues consensually.  Because
these issues necessarily impact plan formulation, the parties
have begun discussions regarding the best means to expeditiously
resolve these issues if the parties are unable to reach an
agreement.  To that end, the Debtors intend to seek approval of a
judicial process for the resolution of the allocation and other
intercompany issues and the Debtors are currently consulting with
the Committee and the U.K. Administrator concerning the
parameters of that request.

                    Plan and Disclosure Statement

Notwithstanding these open issues, the Debtors have expended
substantial effort in developing a Chapter 11 plan and have
engaged the Committee and the U.K. Administrator in dialogue over
the plan structure and its components.  However, because of the
complexity of these outstanding issues, the plan structure has
continued to evolve as the Debtors, in consultation with the
Committee and U.K. Administrator, continue to refine their
approach to the plan.  In the hopes of shortly proposing a
consensual plan, the Debtors, in consultation with the U.K.
Administrator and BRACII, prepared a plan term sheet that was
submitted to the Committee in April, and to which the Committee
responded both at a meeting with the Debtors in June and more
recently in discussions with the Debtors regarding an alternative
plan structure.  The Debtors also have prepared a draft of a
disclosure statement that was provided to the Committee in May.
The Debtors anticipate receiving comments from the Committee
shortly.  The Debtors further anticipate that over the next month
they will continue to finalize the drafting of the plan
documents, taking into account the resolution mechanism for the
allocation and intercompany claim issues, the needs of the U.K.
Administrator regarding the parallel U.K. Administration
proceeding and continuing input from the Committee.

                Post-Closing Issues Associated with
                  the North American and EMEA Sale

Since the Sales closed, the Debtors have continued to address the
various post-closing issues arising in connection with the
transfer of substantially all of the Debtors' assets.  These
post-closing issues include:

    1. addressing matters not originally contemplated by the North
       American ASPA and the EMEA Asset Purchase Agreement,
       including assumption of certain liabilities and payment of
       certain obligations asserted against the Debtors' estates
        and the U.K. Administration;

    2. working to resolve the remaining objections asserted by
       parties to those contracts the Debtors assumed and assigned
       pursuant to the North American ASPA and the EMEA APA;

    3. continuing to pursue a litigation strategy to resolve the
       outstanding post-closing issues relating to the North
       American ASPA and the EMEA; and

    4. developing and executing a strategy for the successful
       wind down of the Debtors' remaining operations.

On May 6, 2003, the Debtors, with the approval and input of the
Committee, sought payment through the Court from Cendant and
Cherokee and complained about the assumption of certain
employment-related litigation under the North American ASPA.  In
response to the Debtors' Complaint, on June 23, 2003, Cendant and
Cherokee filed an answer and counterclaims.  The Court ordered
mediation and the Debtors and the Committee are in the process of
formulating a response to the counterclaims.

In light of all these issues and concerns, the Debtors ask Judge
Walrath to extend their exclusive period to file a plan through
and including August 1, 2003 and their exclusive period to
solicit acceptances of that plan through and including
October 30, 2003.

Mr. Brady relates that the Debtors have continued to make
considerable progress in these cases.  Most importantly, the
Debtors believe that they are poised to bring these cases to
successful completion -- and at the same time to conclude the
U.K. Administration -- upon obtaining clarity as to the amount of
bona fide claims against the estates, reaching a resolution of
the outstanding allocation and other intercompany issues and
solidifying the plan structure and its components.  Each of these
tasks is underway and significant progress has been made working
with the Committee and the U.K. Administrator, but the
complexities and competing interests involved necessitate
additional time for resolution.  The Debtors believe that
continued exclusivity in these cases will foster the process of
formulating and confirming a consensual Chapter 11 plan.

Mr. Brady assures Judge Walrath that the requested extension will
not prejudice the legitimate interests of any creditor.  The
Debtors, the Committee and the U.K. Administrator continue to
work cooperatively through the myriad issues associated with the
U.K. Administration, the allocation and other intercompany issues
and the plan.  Additionally, the Debtors continue to make timely
payment of all of their postpetition obligations.

                        Committee Objects

Christopher S. Sontchi, Esq., at Ashby & Geddes, in Wilmington,
Delaware, points out that the Debtors' assets have been
substantially liquidated, and the Debtors have ceased all normal
business operations and only have to distribute those sale
proceeds and other assets through these Chapter 11 proceedings.

While the Committee and the Debtors have, in fact, been working
cooperatively on formulating and filing an appropriate
liquidating plan for these estates, as well as on a process for
determining appropriate allocations of assets to the different
estates, and while the Debtors recognize that the Committee
represent the economic stakeholders in these cases, the continued
accrual of time and expense in administering these cases requires
the Committee to operate under a much greater sense of urgency in
respect to the plan process.

Mr. Sontchi contends that extending exclusivity until August 1 is
simply inadequate to assure that the plan process commences this
month.  Accordingly, the Committee asks the Court to require the
Debtors to file a plan for these cases within this month.

According to Mr. Sontchi, terminating exclusivity, if necessary,
will not prejudice the Debtors' efforts to move these cases
forward, but will open the plan process, if necessary, to the
Committee to foster an expeditious distribution to creditors.

In the event that the Debtors fail to file a plan within this
month, exclusivity should be terminated in the Committee's favor.

                          Debtors Respond

The Debtors share the Committee's and the U.K. Administrator's
desire to effect a distribution to creditors through a
liquidating plan as quickly as possible.  According to Edmon L.
Morton, Esq., at Young, Conaway, Stargatt & Taylor, LLP, in
Wilmington, Delaware, while the Debtors are reluctant publicly to
quarrel with the Committee in the midst of plan negotiations, the
Committee's suggestion that the Debtors are not proceeding with
alacrity is both inaccurate and unfair.  The principal causes of
delay in the Debtors' efforts to file and confirm a plan have
been the inability of the Committee and the U.K. Administrator to
reach an agreement over sale proceeds allocation issues and
intercompany claims issues, and the Committee's recent decision
to withdraw its support for the plan structure that had initially
been pursued by the Debtors.

The Debtors do not criticize the Committee or the U.K.
Administrator for their failure to achieve settlement -- the
allocation and intercompany issues are undeniably difficult and
complex.  But the Debtors cannot fairly be held responsible for
the absence of a settlement, particularly when the Debtors have
employed every reasonable effort to "broker" a solution.

Since completion of the EMEA Sale to Avis Europe PLC in March
2003, the Debtors have worked cooperatively with the Committee
and the U.K. Administrator to:

    1. fashion a consensual resolution between the U.S. Debtors
       and BRACII concerning the allocation of sale proceeds and
       the resolution of intercompany claims between the
       estates; and

    2. craft a liquidating plan and a parallel scheme of
       arrangement or a company voluntary arrangement that would
       permit prompt distributions to all unsecured creditors.

The plan and arrangement structures initially proposed by the
Debtors assumed -- as did the Committee and the U.K. Administrator
-- that allocation and intercompany issues would be resolved
consensually by the Committee and the U.K. Administrator prior to
confirmation, and that distributions could begin on the plan and
arrangement effective dates based on the agreed resolutions.

By late May, however, it became increasingly apparent to the
parties that the allocation and intercompany issues might not be
resolved consensually.  Accordingly, the Debtors proposed to both
the Committee and the U.K. Administrator that:

    1. The Debtors would file a motion to establish streamlined
       procedures for judicial resolution of the dispute; and

    2. The Debtors would, on a parallel track, file a consensual
       liquidating plan that was premised upon a resolution of the
       allocation and intercompany disputes.

The Debtors further proposed to schedule a disclosure statement
hearing to occur shortly after trial of the allocation and
intercompany issues, so that the results of the trial could be
incorporated into the disclosure statement before votes were
solicited.  The Committee and the U.K. Administrator concurred
with this approach, and the Debtors have prepared and circulated
a draft Procedures Motion.

In mid-June, the Committee informed the Debtors that while the
Committee continued to support the filing of a Procedures Motion,
the Committee no longer wished to proceed with a plan that was
premised on a resolution of the allocation and intercompany
disputes.  Rather, the Committee insisted that the Debtors
immediately file a "stand alone" plan for the U.S. Debtors that
could be confirmed over the objection of the U.K. Administrator
and which would permit a distribution to U.S. creditors prior to
the resolution of the disputes between the U.S. Debtors and
BRACII.

The Debtors informed the Committee that while the Debtors were
unwilling to prosecute confirmation of a plan over the objections
of the U.K. Administrator, the Debtors would, if the Committee
was prepared to support the establishment of reserves in BRACII's
favor, endeavor to negotiate the terms of a plan that would both
be acceptable to the U.K. Administrator and permit distributions
to U.S. creditors prior to resolution of the allocation and
intercompany disputes.  The Debtors have made significant progress
in these negotiations, and a draft Reserve Plan -- which will
permit the simultaneous confirmation of plans for the U.S. Debtors
and BRACII -- has been circulated to both the Committee and the
U.K. Administrator.

Mr. Morton contends that the Debtors remain committed to effecting
distributions to creditors as soon as it is reasonably
practicable.  The Debtors will continue to employ every reasonable
effort to facilitate a consensual resolution of the allocation and
intercompany issues. The Debtors will also utilize their best
judgment to ensure that neither the dispute resolution procedures
nor the plan mechanics unfairly prejudice either the Committee or
the U.K. Administrator.  The Debtors will file a plan as soon as
they are reasonably satisfied that the interests of all creditors
are protected.  The Debtors firmly believe that continued
exclusivity is most effective and efficient environment to
accomplish this.

                           *     *     *

Judge Walrath extends the Debtors' exclusive periods to file a
plan to August 1, 2003 and to solicit votes for that plan to
October 30, 2002 without prejudice to the Debtors' right to file
for another extension. (Budget Group Bankruptcy News, Issue No.
23; Bankruptcy Creditors' Service, Inc., 609/392-0900)


BURLINGTON IND.: Court Approves Hilco's Engagement as Appraisers
----------------------------------------------------------------
Burlington Industries, Inc., and its debtor-affiliates obtained
permission from the Court to employ Hilco, nunc pro tunc to
June 13, 2003, to provide appraisal and valuation services
relating to their inventory, machinery and equipment and real
estate in connection with the auction process.

The parties entered into two engagement letters, dated June 13,
2003 and June 16, 2003.  The Agreements describe the various
appraisal services and valuation methods that Hilco anticipates
performing for the Debtors and the terms and conditions of Hilco's
proposed engagement by the Debtors.  Pursuant to the Agreements,
Hilco's provision of services to the Debtors is contingent upon
the Court's approval of the Agreements' terms and conditions.

Hilco will provide these valuations:

   (a) For the Inventory, Hilco will provide to prospective
       lenders a projection of net and gross liquidation value
       and forced liquidation value scenario;

   (b) For the Equipment, Hilco will provide prospective lenders
       with a detailed net orderly liquidation value and net
       forced liquidation value appraisal for the assets in
       question;

   (c) For the Real Estate, Hilco will estimate the market value
       of the fee simple interest in eight of the Debtors'
       properties, as of the date of the inspection; and

   (d) For all the Sale Assets, Hilco will prepare reports
       outlining these valuations for the Debtors.

In exchange for the services, Andy Dahlman, Vice President of
Hilco Appraisal Services, LLC, Hilco intends to charge an all-in-
fee for its professional services rendered to the Debtors on these
terms:

   (a) Inventory and Equipment

       Hilco's fee for the Inventory and Equipment evaluation
       and appraisal will be $275,000 plus direct out-of-pocket
       costs consisting of travel and expenses.  Of this amount,
       $137,000 is due on the Court's approval of Hilco'
       employment and the balance is due upon completion but
       prior to the delivery of the final report.

   (b) Real Estate

       Hilco's fee for the Real Estate evaluation and appraisal
       will be $72,000 plus direct out-of-pocket costs consisting
       of travel and expenses, which will be payable upon the
       report's completion and the Debtors' acceptance.
       (Burlington Bankruptcy News, Issue No. 36; Bankruptcy
       Creditors' Service, Inc., 609/392-0900)


COLUMBUS MCKINNON: Completes $115MM Senior Secured Note Offering
----------------------------------------------------------------
Columbus McKinnon Corporation (Nasdaq: CMCO) completed its
previously announced sale of $115 million of Senior Secured 10%
Notes due 2010.  The Notes were privately placed.  The Company
used the net proceeds from this offering to repay all outstanding
borrowings under its second secured term loan -- $66.8 million
plus interest and expenses -- to repurchase senior subordinated
notes in the amount of $30.1 million plus interest, and to repay
a portion of its senior credit facility debt -- $3.9 million on
the term loan and $10.0 million on the revolver. The senior
subordinated notes repurchased by Columbus McKinnon had a face
value of $35.7 million, which resulted in a $5.6 million reduction
in debt.  In conjunction with the repayment of its second secured
term loan, the Company will reverse, in the current quarter,
previously accrued interest charges of $0.8 million for payment-
in-kind interest forgiven based on repayment of that debt within
one year.

In connection with this offering, the Company's senior lenders
consented to a concurrent amendment of the senior credit agreement
to permit the note offering; the amendment also provided for,
among other things, an increase in senior leverage ratios for the
fiscal 2004 first quarter and subsequent quarters.

As previously reported, Standard & Poor's Ratings Services
assigned its 'B-' rating to Columbus McKinnon Corp.'s $100 million
senior secured note offering due 2010.

At the same time Standard & Poor's affirmed its 'B' corporate
credit and 'CCC+' subordinated debt ratings on the company. The
outlook remains negative.

At the March 31, 2003 fiscal year-end, Amherst, N.Y.-based
Columbus McKinnon had approximately $323 million of debt
outstanding. The company holds leading (No. 1 or No. 2) niche
market positions within the material handling, lifting, and
positioning products industry.


COM21 INC: Inks Definitive Pact to Sell Certain Assets to ARRIS
---------------------------------------------------------------
ARRIS (Nasdaq: ARRS), a global telecommunications technology
leader, has entered into a definitive agreement for the
acquisition of certain cable modem termination systems and related
assets of COM 21, including the stock of its Irish subsidiary, for
a purchase price of approximately $2,800,000, subject to the
approval of the US Bankruptcy courts and certain other closing
conditions. The transaction will transfer ownership of a DOCSIS
2.0 based Layer 3 capable CMTS specifically suited for smaller
markets to the ARRIS portfolio of next generation high speed data
products. The new C3 product along with ARRIS's market leading
Cadant C4 CMTS provides ARRIS customers with complete market
coverage from very large concentrated urban markets to small and
mediums size markets.

"This is the culmination of our previously announced OEM agreement
with COM 21," said Bob Stanzione, ARRIS Chairman, President & CEO.
"The transaction enables us to own and integrate the intellectual
property and talent behind our new C3 CMTS. The C3 is a feature
rich rack mounted CMTS which will allow us to reach smaller scale
systems domestically and internationally. We expect the
transaction to be slightly dilutive to earnings per share in the
second half of this year and accretive in 2004. The transaction is
an exciting one for us and we are pleased to welcome approximately
45 new employees to the ARRIS family. I am confident they will
help keep us on the leading edge of internet protocol technology,"
concluded Stanzione.

ARRIS provides broadband local access networks with innovative
next generation high-speed data and telephony systems for the
delivery of voice, video and data to the home and business. ARRIS
complete solutions enhance the reliability and value of converged
services from the network to the subscriber. Headquartered in
Duluth, Georgia, USA, ARRIS has design, engineering, distribution,
service and sales office locations throughout the world.
Information about ARRIS' products and services is found at
http://www.arrisi.com


COMM 2001-J1: Fitch Cuts Class G, H & J Note Ratings to BB/B/B-
---------------------------------------------------------------
COMM 2001-J1's commercial mortgage pass-through certificates,
$23.3 million class F has been downgraded to 'BBB-' from 'BBB' by
Fitch Ratings. Fitch has also downgraded the following classes:

     -- $13.6 million class G to 'BB' from 'BBB-';
     -- $13.6 million class H to 'B' from 'BB';
     -- $11.7 million class J to 'B-' from 'BB'.

In addition, Fitch has affirmed the following classes:

     -- $27.8 million class A1 'AAA';
     -- $108.3 million class A1F 'AAA';
     -- $236.7 million class A2 'AAA';
     -- $46.6 million class B 'AA';
     -- $46.6 million class C 'A+';
     -- $15.5 million class D 'A';
     -- $31.1 million class E 'A-';
     -- $7.6 million class M 'AA';
     -- $5 million class P 'BBB-'.

The downgrades are due to the deteriorating performance of the
Thayer Hotel Portfolio and 165 Market Halsey loans. Although these
underlying properties have deteriorating performance, no loan is
or has been delinquent. The transaction is highly concentrated,
with 69.3% office properties. Vacancy rates in six of the seven
office loans (59.4% of loan balance) have increased. However, most
of the office properties in the transaction are located in
relatively strong markets such as New York (23.3% of loan balance)
and Washington, D.C. (14.7%).

As of the July 2003 distribution, the certificate balance has been
reduced by approximately 3.9%, to $764.4 million from $795.3
million at issuance. The certificates are collateralized by eleven
fixed-rate loans secured by eighteen commercial loans. Nine of the
eleven loans, or approximately 80%, have investment grade credit
assessments.

As part of its review, Fitch analyzed the performance of each loan
and the underlying collateral. Fitch compared each loan's debt
service coverage ratio at the year ended December 2002 to the DSCR
at last review (trailing twelve months ended June 2002) and the
DSCR at issuance. DSCRs are based on Fitch adjusted net cash flow
and a stressed debt service based on the current loan balance and
a Fitch hypothetical mortgage constant.

The Thayer Hotel Portfolio loan (14.8%) is secured by six full-
service hotels located in New Jersey, Louisiana, Florida and
Texas. The Fitch stressed DSCR for the pool of loans decreased to
1.12 times as of Dec. 31, 2002 from 1.70x at issuance. RevPar for
the portfolio has decreased to $75 as of YE 2002, from $85 at
issuance. The current volatile state of the hotel industry and
overbuilt markets has contributed to the decline of this hotel
portfolio.

The Market Halsey loan (7.2%) is secured by a 16-story telecom
carrier hotel located in downtown Newark, NJ. The property is
configured specifically for telecommunications and technology
based tenants. The occupancy decreased to 83% as of YE 2002, from
90% at issuance. The Fitch stressed DSCR declined to 1.33x as of
YE December 2002 from 1.44x at issuance. The deterioration in
performance is due to the decline in occupancy. In addition, Fitch
is concerned with the tenancy of the building given that
MCI/Worldcom (9.6% of net rentable area), and Qwest Communications
(23.6%) are currently in bankruptcy.

Performance has improved in several loans (36.5%). The largest
loan in the pool, the Graybar Building (16.3%), is secured by a
1.3 million square foot building located adjacent to the Grand
Central Terminal in New York City. Although occupancy has declined
to 91% as of March 31, 2003 from 96% at issuance, NCF has
increased 5.5% due to increased rental rates paid by new tenants.
DSCR for YE 2002 has increased to 1.47x, from 1.37x at issuance.
The Plaza at La Jolla (10.4%) is secured by a five Class A office
buildings containing 633,000 square feet, and located in the San
Diego MSA. DSCR has increased to 1.56x as of YE 2002, from 1.41x
at issuance. Occupancy has increased to 100% as of March 31, 2003,
from 98.4% at issuance, and as of YE 2002 NCF has increased 16.1%
from issuance. NCF has also increased in the Golden Triangle
Portfolio (9.9%). The loan is secured by four office buildings in
the central business district of Washington, D.C. Occupancy has
decreased to 89.9% as of YE 2002, from 97.9% at issuance. As of YE
2002, NCF has increased 8.3% since issuance, and the DSCR has
increased to 1.59x from 1.55x at issuance.

Performance is stable in the remaining loans (28.8%). YE 2002 NCF
at Boise Towne Square (10.2%), a 1.17 million square foot regional
mall in Boise, has increased 2.5% since issuance. YE 2002 NCF has
increased 3.2% since issuance at 28 and 40 West 23rd Street
(7.5%), two connected office buildings in New York City. As of YE
2002. the DSCR for Pennsylvania Plaza (4.4%) has decreased to
1.38x from 1.40x at issuance. The DSCR for U.S. Bancorp (14.25%)
has decreased to 1.45x at YE 2002 from 1.46x issuance. The loan is
secured by an office tower and plaza containing 1.1 million square
feet located in Portland, OR. Occupancy has decreased to 91.0%,
from 94.6% at issuance. Decreased occupancy and increased expenses
have resulted in NCF decreasing 1.1% since issuance.

Fitch will continue to monitor the transaction, as surveillance is
ongoing.


CONSOL ENERGY: Liquidity Concerns Prompt S&P's BB+/B Ratings
------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
ratings on Consol Energy Inc., out of investment grade to
'BB+'/'B' from 'BBB-'/'A-3' based on Standard & Poor's assessment
that the possible cancellation of surety bonds combined with
Consol's potential production growth could result in substantially
reduced liquidity. The current outlook is stable.

Standard & Poor's said that at the same time it has placed its
'BB+' rating on the company's senior unsecured debt, which was
also lowered from 'BBB-', on CreditWatch with negative
implications based on increased risk lenders could face if the
banks asked for collateral on the credit facility. Total debt at
Pittsburgh, Pa.-based Consol is $652 million.

"The downgrade reflects Standard & Poor's assessment that the
potential cancellation of surety bonds combined with Consol's
potential capital expenditures for production growth could result
in substantially reduced liquidity", said Standard & Poor's credit
analyst Dominick D'Ascoli. Standard & Poor's believes the rate of
cancellations on surety bonds by insurance companies will increase
due to the number of re-insurers exiting this business by year's
end. As insurance companies exit the surety bond business, Consol
will need to provide assurances on its underlying obligations.
These assurances will most likely take the form of letters of
credit or cash collateral, which would reduce liquidity. The most
imminent issue facing the company is the $422 million of workers'
compensation surety bonds outstanding as of March 31, 2003. Also,
potential production growth, in both coal and gas operations,
could lead to increased capital expenditures for the next few
years. Consequently, free cash flow in 2004 and 2005 may not be at
levels sufficient to prevent a further reduction in liquidity.

Standard & Poor's said that it placed Consol's senior unsecured
debt rating on CreditWatch because operating asset collateral may
need to be provided for the company's bank credit facility, which
would place the senior unsecured lenders at a disadvantage.

Standard & Poor's ratings on Consol reflect its strength as an
efficient producer of underground coal, significant reserve
position, and energy diversification strategy. The ratings also
reflect the current challenging industry conditions, and the high
degree of financial leverage, which includes debt and
postretirement obligations. Consol is the fifth-largest coal
producer in the U.S. and the largest in the eastern U.S.


COVANTA ENERGY: Court Fixes Aug. 14 Bar Date for 30 New Debtors
---------------------------------------------------------------
The Court orders that:

    (a) the form and manner of the New Covanta Energy Debtors' Bar
        Date Notice, the Instructions and the Publication Notice
        are approved;

    (b) all Entities holding or asserting any prepetition claims
        against any of the New Debtors must file proofs of claim
        so that the proof of claim is received by the Court on or
        before 5:00 p.m., Eastern Time, on August 14, 2003;

    (c) any governmental unit must file its claim on or before
        December 5, 2003 at 5:00 p.m.; and

    (d) an entity holding a claim in connection with the
        rejection by one or more of the New Debtors of any
        executory contract or unexpired lease arising after
        June 26, 2003 but prior to the entry of an order
        confirming a reorganization plan or liquidation in these
        cases must file a proof of claim, if any, on or before the
        later of:

        (1) August 14, 2003; and

        (2) the New Debtors' Rejection Bar Date, which is 30 days
            after the Debtors send via first class U.S. mail a
            notice or copy of the order authorizing the rejection
            of a particular executory contract or unexpired lease
            to the affected counterparty or lessor, as the case
            may be, which service will be made on or before the
            11th day after the entry of the order granting the
            rejection. (Covanta Bankruptcy News, Issue No. 32;
            Bankruptcy Creditors' Service, Inc., 609/392-0900)


DEAN FOODS: S&P Affirms BB+ Corporate Credit Rating
---------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'BB+' corporate
credit ratings on Dean Foods Co. and its wholly owned subsidiary,
Dean Holding Co. The ratings are removed from CreditWatch, where
they were placed on June 2, 2003.

The outlook is positive.

Dallas, Texas-based Dean Foods has about $3.4 billion in rated
debt.

"The outlook revision reflects the completion of the common equity
conversion of the last tranche of preferred securities and
Standard & Poor's expectation that Dean Foods' credit protection
measures will, in the near term, improve to a level that would be
commensurate with an investment grade rating. Key to an upgrade
will be Dean Foods' ability to sustain stronger credit protection
measures and at the same time continue its acquisition strategy,"
said credit analyst Jayne M. Ross. The ratings reflect Dean Foods'
position as the largest national dairy company in the U.S., with
about a 35% share of the U.S. dairy industry. This is offset by a
moderately aggressive financial profile and the company's
acquisitiveness. The ratings further reflect the company's
strong portfolio of national, regional, local, and private-label
brands, solid regional market positions, geographic diversity,
stable cash flow, moderate capital expenditures, cost-saving
opportunities, and an experienced management team.


DEVINE ENTERTAINMENT: Red Ink Continues to Flow in March Quarter
----------------------------------------------------------------
Devine Entertainment Corporation (TSE:DVN) reported results for
the year ended December 31, 2002 and the three months ended
March 31, 2003.

Management acknowledged that 2002 and the first quarter of 2003
were challenging times for Devine Entertainment. The Company's
main asset, its film library, continued to perform well generating
revenues of over $900,000, but difficult market conditions in
general and the insolvency of two of the Company's distributors,
Steeplechase Entertainment and Media Content, created significant
cash flow losses. The delay of new production into 2003 and the
lack of income related to production activity limited the
Company's revenues, creating additional financial difficulties. As
a result, the Company's auditors have reviewed the Company's
finances and approved the 2002 financial statements on a going
concern basis. The Company's continuing library sales, cuts to its
operating costs and the deferral of remuneration by management
have allowed the Company to satisfy its primary obligations, but
the Company remains in default on much of its long term debt and
new financing or new production income will be required before the
end of 2003 in order for the Company to continue to meet its
obligations. Management is committed to new production activity in
2003 that is expected to play an important part in turning around
the Company's financial situation, and returning the Company to
profitability.

Overall, revenues from sales of the Company's film library in 2002
were $917,398 (all amounts in Canadian dollars), a decrease of 6%
from $973,626 in 2001. Broadcast sales were up almost 70% at
$190,500 in 2002, as compared to $112,230 in fiscal 2001. Despite
a negative climate for the entertainment industry overall, and the
difficulties with some of the Company's third party distributors,
the Company's North American video sales in 2002 remained strong
accounting for 79% of total revenues. In 2002, revenues from North
American video sales were $726,898 as compared to $861,000 in
2001. Net operating losses totaled $862,503 or approximately $0.06
per share in 2002, an improvement of over 20% from a loss of
$1,095,169 or $0.08 per share for 2001. In light of the lack of
new production activity in 2002 and in accordance with U.S. GAAP,
the Company took a write-down of $757,749 on its investment in the
development of new projects over the last three years. After the
write down of the Company's development slate of $757,794, the
basic and fully diluted loss for 2002 was $1,620,297 or $0.12 per
share as compared to a loss of $7,442,443 or $0.58 per share in
2001.

The Company also reported a net loss for the three months ended
March 31, 2003 of $99,762, or $0.01 a share, as compared to a loss
of $97,569, or $0.01 per share, for the same quarter in 2002. The
Company's revenues decreased 48% to $165,538 as compared to
$318,138 for the same period in 2002, primarily due to the timing
of the recognition of $180,000 of revenues from a CBC broadcast
license in March of 2002. Revenues from video sales of the
Company's library increased 20% from $138,138 for the first
quarter of 2002 to $165,538 for the first quarter of 2003.
Operating expenses for the first quarter of 2003 were $126,009 as
compared to $174,035 for the same period in 2002, a decrease of
23%. The Company's cash position at March 31, 2003 was $18,275 as
compared to $34,969 at the beginning of the quarter.

Management noted that the Company has recently established a new
co-production relationship with U.K. based Spice Factory, the
leading feature film producer in the U.K. in 2001, and secured
distribution and financing commitments from ArcLight Films,
Telefilm Canada, Odeon (a division of Alliance Atlantis),
Superchannel, Corus Entertainment and Astral Media's The Movie
Network which promise the resumption of renewed production
activity with the Company's first feature film for the world-wide
family audience, entitled "Bailey". The Company is optimistic that
the $10 million production will commence in the third quarter of
2003.

To assist in the Company's financing of "Bailey" and generate new
working capital, the Company's board of directors approved the
terms of a proposed bridge loan from an investor group including
management at its most recent board meeting on July 17, 2003.
Subject to regulatory approval and compliance with applicable
securities law, the board approved payment terms for the bridge
financing that include the issuance of common shares, deferred
fees and an interest in the profits of the film and also approved
the payment for certain outstanding obligations through the
issuance of common shares to management, certain consultants and
third party lenders. In addition, the board authorized management
to request the lifting of an Ontario Securities Commission
management cease trade order and to make preparations for the
Company's annual shareholder meeting within the next 90 days.

Devine Entertainment Corporation is a five-time Emmy Award-winning
global producer and distributor of children's and family
entertainment. The Composers', Inventors', and Artists' Specials
are currently broadcast in over 50 countries. Headquartered in
Toronto, the Company's common shares trade on the Toronto Stock
Exchange, trading symbol DVN, and OTC in the U.S. under symbol
DVNNF. The Company's corporate Web site is
http://www.devine-ent.com

As reported in Troubled Company Reporter's June 3, 2003 edition,
Devine is actively negotiating a series of corporate and
production related financings that, if completed successfully in
the near future, will put the Company on a stronger fiscal
footing and enable it to complete its filings and schedule a
shareholders meeting within the next 45-75 days. The Company has
been pursuing new financing for some time and acknowledges that,
if a financing is not completed in the near future, it may not
be able to meet all of its ongoing obligations which could
necessitate a reorganization of the Company and a change in the
status of its TSX listing.

Devine's management continues to pursue new corporate financing,
new production and the maximizing of revenues and the value of
its proprietary film library. Management remains committed to
its shareholders and creditors in a very difficult time for
Toronto-based film production companies and the Canadian
entertainment sector in general.


DOUBLECLICK INC: Reports Improved 2nd Quarter Financial Results
---------------------------------------------------------------
DoubleClick Inc. (Nasdaq: DCLK), the leading provider of data and
technology tools for direct marketers, web publishers and
advertisers, announced financial results for the second quarter
ending June 30, 2003, and updated its business outlook for full
year 2003.

DoubleClick reported revenues for the second quarter of $63.6
million versus $75.7 million in the year ago period. Revenues
increased sequentially by 5.8%, though they declined 16.0% year-
over-year largely due to the divestitures of businesses in 2002.
Total GAAP operating expenses were $32.1 million, a decline of 45%
versus $58.4 million in the second quarter of 2002. GAAP net
income for the most recent quarter was $5.8 million, with a GAAP
EPS of $0.04, compared with $4.1 million and a GAAP EPS of $0.03
in the second quarter of 2002. Total company headcount at the end
of the second quarter was 1,082, down 15% from 1,270 at the end of
the second quarter of 2002.

The Company's expenses declined in the second quarter of 2003
versus the year ago period due to the divestitures of its Media,
DoubleClick Japan, and Research businesses, and because of ongoing
cost-cutting initiatives. Second quarter 2003 GAAP earnings and
expenses also benefited from a net restructuring credit of $6.9
million, which resulted from a $14.3 million reversal of
DoubleClick's real estate reserve for its New York facility offset
by $7.4 million in additional restructuring charges in connection
with certain of the Company's other facilities. In addition, 2Q03
GAAP earnings were reduced by a $4.4 million loss in connection
with the redemption of the Company's 4.75% convertible
subordinated notes and $1.0 million in equity losses associated
with the Company's minority investments. Last year's second-
quarter results included a $7.3 million restructuring charge
related to the Company's real estate and a $11.9 million gain
related to the sale of the Company's @plan research product line.

The Company used $0.6 million in cash flow from operations during
the second quarter of 2003. This figure included a payment of
$14.4 million in connection with the termination of a portion of
the lease on the Company's New York headquarters. The Company
ended the quarter with $873.2 million in cash and marketable
securities, and had a net cash position of $580.2 million, or
$4.23 per share On June 23, 2003, the Company issued $135 million
of zero coupon convertible subordinated notes due 2023, the
proceeds of which, together with existing cash, will be used to
redeem the Company's $154.8 million of 4.75% convertible
subordinated notes due 2006 on July 24, 2003.

"DoubleClick's business continues to thrive despite the continued
softness in marketing and technology spending," said Kevin Ryan,
Chief Executive Officer, DoubleClick. "During the quarter, we were
able to successfully complete a convertible bond offering,
continue to build our suite of marketing technology tools through
the acquisition of a data management company, as well as sign on
large customers. In addition, we eliminated some excess real
estate exposure in New York, which will help cash flow in future
quarters."

                         TechSolutions

The global TechSolutions division reported second quarter revenues
of $43.5 million. Total TechSolutions gross margins were 61.9%, a
decline from 65.1% in the second quarter of 2002. DoubleClick's
global DART and DARTmail platforms delivered 151.1 billion
impressions in the second quarter of 2003. The Company's Ad
Management products had revenues of $32.6 million in 2Q03, versus
$38.1 million in the year ago period. In the second quarter of
2003, DoubleClick's DART for Advertisers product saw a strong
volume increase, which is attributable to existing customers
running more online campaigns throughout the system, as well as
from the enrollment of new agencies.

During the quarter, eBay signed a multi-year deal to use
DoubleClick's ad management solution. In addition, the Company
launched a new version of its ad management software, DART
Enterprise, and began the beta phase of its new rich media
product, DART Motif, which derived from a partnership with
Macromedia. On the planning side of DoubleClick's business, the
Company completed the integration of the IMS reach and frequency
tool, Web RF, with DoubleClick's MediaVisor tool. Customers of
both Web RF and MediaVisor now have the ability to plan their
online advertising campaigns using reach and frequency data, the
standard metrics used to plan television campaigns as well as
other offline media.

DoubleClick's email management and delivery platform, DARTmail,
reported revenues of $9.2 million for 2Q03, versus $9.9 million in
the year ago period. In the second quarter DoubleClick unveiled
several initiatives designed to help marketers and the email
marketing industry better understand and leverage policy,
research, education, and technology, in the fight against spam,
and to further differentiate legitimate marketing communications
from unwanted and unsolicited email. As part of these initiatives,
DoubleClick plans to issue quarterly reports on government and ISP
developments; hold an industry event in the fall which will be
exclusively focused on the spam crisis; increase its investment in
technology solutions that enhance email delivery; and continue to
field both consumer and marketer research on this issue. In
addition, DoubleClick recently completed a large study with AOL in
order to better understand consumers' attitudes and reactions to
unwanted and unsolicited email. Primary results will be available
in the third quarter and the full findings will be presented at
the Advertising Research Foundation conference in September.

DoubleClick's TechSolutions segment also includes its Campaign
Management product, Ensemble, and its web analytics tool,
SiteAdvance. The Company completed two large customer
installations of the Ensemble product during the second quarter,
and remains on schedule with its plan to release the latest
version, 6.5, in December. This version will include integration
with DoubleClick's DARTmail product. Web publishers continue to
use SiteAdvance in order to understand how their customers are
interacting with the publishers' websites. During the second
quarter, SiteAdvance launched in international markets, starting
with customers such as Dixons Group PLC and Loyalty Management.
The product also added a new feature that allows e-commerce sites
to use DARTmail to remarket to consumers who abandoned items
within online shopping carts.

"Our portfolio of technology and data marketing solutions
continues to grow in terms of both product offerings and client
base," said David Rosenblatt, President, DoubleClick. "We continue
the momentum within each of our divisions as clients and prospects
recognize the value of our integrated solutions and overall R&D
investment, coupled with the advantages of working with a company
that has the expertise and the financial resources to help them
grow their businesses."

                             Data

DoubleClick Data revenue increased 12.3% to $20.1 million in 2Q03
versus $17.9 million in 2Q02. Excluding $0.8 million in revenue
associated with DoubleClick's former research products,
DoubleClick Data revenue increased 17.5%. Gross margins were
70.7%, a slight dip from the year ago period. Abacus's business-
to-consumer alliance revenues grew 13.6% year-over-year. The U.S.
Business-to-Business segment of Abacus continued its strong growth
in the second quarter, increasing its revenue 78.4%.

"We are particularly happy with the second quarter results from
the Data segment," continued Rosenblatt. "The Abacus teams in the
U.S. and U.K. have done an exceptional job in outperforming the
catalog industry."

In the second quarter of 2003, DoubleClick launched Abacus Japan
as part of its international operations. Japan is the second
largest catalog market in the world, and interest from the
country's catalog companies has been very encouraging. In the long
term, DoubleClick believes that this market has the potential to
be the second largest in the world, after the U.S.

Going forward, the Data business will also include DoubleClick's
new Data Management division. This division was formed as a result
of the Company's recent acquisition of CSC Advanced Database
Solutions, a privately held data management solutions company that
specializes in building, maintaining and providing access to
customer marketing databases. Almost all of DoubleClick's Abacus,
email, and campaign management customers use a data management
solution, which represents great synergy with DoubleClick's
business as well as an opportunity to incrementally grow revenues.
DoubleClick plans to continue to offer CSC's products as stand-
alone products in addition to integrating many of DoubleClick's
products into the data management solution in the future.

                    Third Quarter 2003 Outlook

DoubleClick is expecting third quarter revenues to be between $73
million and $77 million. GAAP earnings for the third quarter are
projected to be between $0.00 and $0.04 per share.

Segment projections for the third quarter of 2003 are as follows:

* Data revenues are estimated to be between $31 million and $33
  million, with gross margins in the low 70's percentage range,
  including $2.5 million from Data Management.

* TechSolutions revenues are estimated to be between $42 million
  and $45 million, with gross margins in the low 60's percentage
  range.

* Within TechSolutions, Email technology is expected to generate
  revenues between $9.5 million and $10 million and new
  initiatives should account for about $2.5 million of revenues.

Total company gross margins are expected to be in the mid 60's
percentage range. Total company GAAP operating expenses are
expected to be between $48 million and $50 million. Gross margin
and operating cost estimates include the impact of charges of $0.8
million and $7.5 million, respectively, for leasehold improvements
associated with the planned exit of certain real estate facilities
by year-end. Items in interest and other are expected to add
roughly $1.5 million in after-tax income.

                     Full Year 2003 Update

Based on strong results to date, DoubleClick is narrowing its full
year 2003 earnings guidance towards the high end. The Company now
expects GAAP earnings per share in the range of $0.07 to $0.12 for
the full year 2003, versus the previous range of $0.03 to $0.12.
Full year revenue guidance is also being tightened, to $260 to
$275 million from $250 to $300 million previously.

"Even as we invest in new products and clean up excess real estate
exposure, profitability continues to improve, indicating that the
fundamentals of the business are very healthy," said Bruce
Dalziel, Chief Financial Officer, DoubleClick. "We will continue
to focus on growing revenues as well as expanding our product
lines to meet the needs of our customers."

DoubleClick -- http://www.doubleclick.net-- is the leading
provider of data and technology for advertisers, direct marketers
and web publishers to plan, execute and analyze their marketing
programs. DoubleClick's online advertising, email marketing and
database marketing solutions help clients yield the highest return
on their marketing dollar. In addition, the Company's marketing
analytics tools help clients measure performance within and across
channels. DoubleClick Inc. has global headquarters in New York
City and maintains 21 offices around the world.

As reported in Troubled Company Reporter' June 24, 2003 Edition,
Standard & Poor's Ratings Services assigned its 'B-' rating to
DoubleClick Inc.'s $135 million convertible subordinated notes due
2023.

"The convertible subordinated notes were rated one notch below the
corporate credit rating given its ample cash balances, moderate
levels of obligations that rank ahead of the subordinated debt,
and Standard & Poor's expectation that the company is unlikely to
increase its priority obligations in the intermediate term," said
credit analyst Andy Liu. Net proceeds will be used to repay
existing debt. New York, New York-based DoubleClick had $154.8
million of debt outstanding on March 31, 2003.

At the same time, Standard & Poor's revised its outlook on the
ratings to stable from negative. The outlook revision reflects the
company's improvement in profitability and discretionary cash
flow. All existing ratings are affirmed.


EAGLE-PICHER INC: S&P Assigns B+ Senior Secured Bank Loan Rating
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B+' senior
secured bank loan rating to the $275 million senior secured credit
facilities of Eagle-Picher Inc., formerly Eagle-Picher Industries
Inc.

Standard & Poor's also assigned its 'B-' senior unsecured debt
ratings to the company's $220 million senior unsecured notes due
2013. Proceeds will be used to repay existing debt, refinance the
company's existing $220 million subordinated notes due 2008, and
for working capital and general corporate purposes.

At the same time, Standard & Poor's affirmed its 'B+' corporate
credit rating on the company and its 'CCC+' preferred stock
ratings on Eagle-Picher Holdings Inc.  The outlook remains stable.

Phoenix, Ariz.-based Eagle-Picher is a provider of niche products
to the automotive, aerospace, defense, telecommunications, and
pharmaceutical end-markets. It will have pro forma total debt of
about $407 million.

The senior secured bank facilities consist of a $125 million
revolving credit facility due 2008 and a $150 million term loan B
due 2009 and are secured by a first-priority perfected security
interest in all the tangible and intangible assets owned by Eagle-
Picher and the capital stock of the company and its guarantor
subsidiaries (limited to 65% of the voting stock of its foreign
subsidiaries). The bank facilities are rated the same as the
company's corporate credit rating, reflecting the likelihood of a
meaningful recovery of principal in the event of a default or
bankruptcy, despite significant loss exposure.

"Intense pricing pressures have played a large role in the
automotive industry. However, the company's strong technical
capabilities have helped it to compete against stronger and
better-positioned competitors in the industry (including original
equipment manufacturers)," said Standard & Poor's credit analyst
Linli Chee.

"We expect Eagle-Picher to continue to realize benefits from
ongoing restructuring and productivity enhancements," Ms. Chee
said. "The demonstrated ability of new management to improve
operating performance should offset the impact of flat-to-low
revenue growth in the company's automotive segment in the near
term to ensure credit protection measures remain in line with the
rating."


EL PASO CORP: Re-Election of Board's Nominees Confirmed
-------------------------------------------------------
El Paso Corporation (NYSE: EP) announced that the independent
inspectors of election have delivered their certified Final Report
of the results of voting at El Paso's 2003 Annual Meeting of
Shareholders.  The Final Report confirms that the Board of
Directors' nominees were reelected at the June 17 Annual Meeting.
The breakdown of the certified voting results for each Director
nominee, together with a summary of the certified voting results
for each of the other proposals voted upon at the meeting, is
attached to this release.

El Paso Corporation (S&P, B+ L-T Corporate Credit Rating,
Negative) is the leading provider of natural gas services and the
largest pipeline company in North America.  The company has core
businesses in pipelines, production, and midstream services.  Rich
in assets, El Paso is committed to developing and delivering new
energy supplies and to meeting the growing demand for new energy
infrastructure.  For more information, visit http://www.elpaso.com

           El Paso Corporation Annual Meeting - June 17, 2003
   Certified Voting Report of IVS Associates Inc. - July 22, 2003

Certified results of voting with respect to the election of
Directors:

         Nominees                   For
         --------                   ---
    John M. Bissell             230,211,392
    Juan Carlos Braniff         224,777,447
    James L. Dunlap             230,368,109
    Robert W. Goldman           230,398,308
    Anthony W. Hall, Jr.        230,382,094
    Ronald L. Kuehn, Jr.        230,003,212
    J. Carleton MacNeil, Jr.    230,421,643
    Thomas R. McDade            224,779,864
    J. Michael Talbert          229,930,687
    Malcolm Wallop              220,130,651
    John L. Whitmire            231,890,432
    Joe B. Wyatt                225,416,482
    R. Gerald Bennett           197,431,145
    C. Robert Black             196,410,411
    Charles H. Bowman           197,436,059
    Ronald J. Burns             197,427,286
    Stephen D. Chesebro         197,325,344
    Ted Earl Davis              197,491,257
    John J. Murphy              202,930,257
    John V. Singleton           197,469,153
    Selim K. Zilkha             115,849,899

Certified voting results with respect to each of the other
proposals presented at the Annual Meeting are indicated below:

    --  The company proposal to ratify the appointment of
        PricewaterhouseCoopers LLP as independent certified public
        accountants for fiscal year ending December 31, 2003 was
        approved;

    --  The company proposal to amend our Certificate of
        Incorporation to eliminate Article 12 containing a "fair
        price" provision was approved;

    --  The company proposal to amend our Certificate of
        Incorporation to eliminate our Series A Junior
        Participating Preferred Stock was approved;

    --  The dissident proposal to amend the company's By-laws to
        fix the number of directors at nine was defeated;

    --  The dissident proposal to amend the company's By-laws to
        delete advance notice provisions applicable to director
        nominations was defeated;

    --  The dissident proposal to amend the company's By-laws to
        repeal changes made after November 7, 2002 was defeated;

    --  The dissident proposal purporting to establish the
        sequence for presentation of proposals at the annual
        meeting was approved;

    --  The shareholder proposal requesting the preparation of a
        pay disparity report was defeated;

    --  The shareholder proposal requesting that the company index
        options for senior executives was defeated; and

    --  The shareholder proposal requesting that the company
        redeem any poison pill and seek shareholder approval prior
        to the adoption of any new poison pill was approved.


ENERGY PARTNERS: S&P Assigns B+ Corporate Credit Rating
-------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B+' corporate
credit rating to independent exploration and production company
Energy Partners Ltd. At the same time, Standard & Poor's assigned
its 'B+' issue rating to Energy Partners' proposed $150 million
senior unsecured notes due 2010. The outlook is stable.

New Orleans, La.-based Energy Partners has about $150 million of
debt outstanding, pro forma the transaction.

"The proceeds from the transaction will be used to refinance
current indebtedness and provide capital for future growth
initiatives such as property acquisitions," noted Standard &
Poor's credit analyst Daniel Volpi.

Pro forma for the transaction, total debt to capital is roughly
38% (47% if preferred stock is considered debt). EBITDA interest
coverage is expected to be above 7x at midcycle hydrocarbon prices
although coverage measures in 2003 are likely to be stronger
because of current commodity prices and the company's commodity
price hedge position; roughly 50% of 2003 production hedged at
favorable prices. However, only 10% of 2004 natural gas production
is hedged, which materially exposes the company's
cash flow to swings in commodity prices.

Pro forma for the transaction, Energy Partners will have about $67
million of cash on hand and full access to a $60 million senior
secured revolving credit facility (expires March 2005). While the
company is not expected to maintain such high cash balances, the
ratings presume that management will maintain adequate liquidity.
In addition, Energy Partners plans to limit capital expenditures
to operating cash flow. The company's bank credit facility
contains financial covenants including a minimum tangible net
worth test and EBITDA plus exploration expense to interest ratio.
Presently, Energy Partners is comfortably in its covenants. Energy
Partners' liquidity profile benefits from an absence of near-term
debt maturities, with its credit facility maturing in 2005 and the
proposed notes in 2010.

The stable outlook reflects expectations that Energy Partners will
maintain disciplined financial policies. Acquisitions are expected
to either have been partially prefinanced with the proposed notes
offering or, if significantly larger, to incorporate an equity
component.


ENRON CORP: Settlement Shows Cost of Neglecting Risk Management
---------------------------------------------------------------
The proposed settlement of Enron Corp.'s Chapter 11 bankruptcy is
positive proof of the consequences of neglecting the practice of
proper risk management techniques, a renowned energy commentator
says.

Shirley S. Savage, co-author of the best-selling book "Power
Market Risk: How to Survive (& Prosper) in Crazy Times," responded
to the July 11 news of the proposed settlement of the energy
conglomerate's record $67 billion debt to creditors: "They were
swindled. Enron's deal, offering between 14 and 18 cents on the
dollar to hundreds of struggling companies, is the ruinous
consequence of ignoring risk management. The landscape of the
American power industry is littered with the casualties of Enron's
proven dishonesty and manipulative practices. The consequences
will endure for years."

Ms. Savage goes on to add: "Enron (and other speculative players)
made a mockery of fair markets during the California power crisis.
But the companies who were duped by them have only themselves to
blame. Proper credit analysis, prudent risk portfolio management,
use of competitive intelligence methodology, and critical analysis
of price formation - plus a careful reading of Enron's own minimal
disclosure of its financial practices - would have warned
creditors that they were in grave peril, and enabled them to
extricate themselves long before the collapse occurred."

The lessons have dawned on the many readers of Ms. Savage's book,
which has been snapped up by power companies, marketers,
regulators and consultants in the US, and worldwide, and widely
praised for its simple exposition of how to effectively practice
risk management. Its publisher, The Thinking Companies, Inc., is
extending the opportunity for those who have not yet seen the
light to buy the book at a 'Summer Sale' price of $159 through
August 31, 2003. As the respected journal Public Utilities
Fortnight observed: "The few dollars invested in this ...engaging
book ... could pay great dividends for energy companies trying to
get a better grasp on how to manage risk."

You can find it online (and read other rave reviews) at
http://www.thinkingenergy.comor call 207-829-3223 to place an
order.

For further information or commentary: Shirley S. Savage, The
Thinking Companies, Inc., 207-829-2020. E-Mail:
ronin@thinkingenergy.com


ENRON CORP: Classification and Treatment of Claims Under Plan
-------------------------------------------------------------
Stephen F. Cooper, Acting President, Acting Chief Executive
Officer and Chief Restructuring Officer of Enron Corp., reports
that the Debtors made these classifications, treatment of, and
estimated recoveries on, Allowed Claims and Equity Interests under
the Plan:

Class  Type of Claim   Estimate   Claim Treatment
-----  -------------   --------   ---------------
  N/A   Administrative   100%      Payment in full, in cash
        Expense Claims
                                   Unimpaired; not entitled to
                                   vote.

  N/A   Priority Tax     100%      At the Debtors' option, either:
        Claims
                                   (a) pay in full in cash,

                                   (b) paid over a six-year period
                                       from the date of assessment
                                       with interest at a rate to
                                       be determined by the Court,
                                       or

                                   (c) as mutually agreed by the
                                       Claim holder and the
                                       Debtors.

                                   Unimpaired; not entitled to
                                   vote.

    1   Priority         100%      Payment in full, in cash
        Non-Tax Claims
                                   Unimpaired; not entitled to
                                   vote.

    2   Secured Claims   100%      At the Debtors' option, either:

                                   (a) the payment in full, in
                                       Cash;

                                   (b) the sale or disposition
                                       proceeds of the property
                                       securing any Allowed
                                       Secured Claim to the extent
                                       of the value of their
                                       interests in the property;

                                   (c) the surrender to the Claim
                                       holder of the property
                                       securing the Claim; or

                                   (d) other distributions as
                                       will be necessary to
                                       satisfy the requirements of
                                       Bankruptcy Code.

                                   Unimpaired; not entitled to
                                   vote.

        General                    Distribution of:
        Unsecured Claims
        Against:                   (a) Pro Rata Share of the
                                       Distributive Assets
    3   -- EMCC           58.9%        attributable to that
    4   -- ENE            14.4%        particular Debtor; and
    5   -- ENA            18.3%
    6   -- EPMI           21.3%    (b) Pro Rata Share of 3,000,000
    7   -- PBOG           75.0%        Litigation Trust Interest
    8   -- SSLC           19.5%        and 3,000,000 Special
    9   -- EBS            12.7%        Litigation Trust Interests.
   10   -- EESO           10.8%
   11   -- EEMC           28.9%        Impaired; entitled to vote.
   12   -- EESI           28.0%
   13   -- EES            61.8%
   14   -- ETS            75.0%
   15   -- BAM             6.3%
   16   -- ENA Asset      75.0%
            Holdings
   17   -- EGLI           19.2%
   18   -- EGM             5.0%
   19   -- ENW             5.1%
   20   -- EIM             5.0%
   21   -- OEC            13.0%
   22   -- EECC           12.5%
   23   -- EEOSC           5.0%
   24   -- Garden State    5.0%
   25   -- Palm Beach      5.0%
   26   -- TSI             8.0%
   27   -- EEIS           57.3%
   28   -- EESOMI         39.3%
   29   -- EFSI            5.0%
   30   -- EFM            24.5%
   31   -- EBS LP          5.0%
   32   -- EESNA           5.9%
   33   -- LNG Mktg.      75.0%
   34   -- Calypso         5.0%
   35   -- Global LNG     75.0%
   36   -- EIFM           75.0%
   37   -- ENGMC          19.7%
   38   -- ENA Upstream   15.6%
   39   -- ELFI           29.3%
   40   -- LNG Shipping   75.0%
   41   -- EPSC            9.4%
   42   -- ECTRIC         18.7%
   43   -- Communications  7.5%
            Leasing
   44   -- Wind           32.2%
   45   -- Wind Systems   46.0%
   46   -- EWESC          44.1%
   47   -- Wind            5.7%
            Maintenance
   48   -- Wind           43.5%
            Constructors
   49   -- EREC I         46.0%
   50   -- EREC II        43.5%
   51   -- EREC III       44.1%
   52   -- EREC IV         5.7%
   53   -- EREC V         32.2%
   54   -- Intratex        5.0%
   55   -- EPPI            5.0%
   56   -- Methanol       13.8%
   57   -- Ventures        9.4%
   58   -- Enron           5.0%
            Mauritius
   59   -- India Holdings  5.0%
   60   -- OPP            75.0%
   61   -- NETCO          75.0%
   62   -- EESSH          79.6%
   63   -- Wind Dev't.    65.8%
   64   -- ZWHC           75.0%
   65   -- Zond Pacific    5.0%
   66   -- ERAC           75.0%
   67   -- NEPCO           8.3%
   68   -- EPICC           7.5%
   69   -- NEPCO Power     8.3%
            Procurement
   70   -- NEPCO Services  8.6%
   71   -- San Juan Gas   21.6%
   72   -- EBF LLC        75.0%
   73   -- Zond           37.1%
            Minnesota
   74   -- EFII           29.6%
   75   -- E Power        36.7%
            Holdings
   76   -- EFS-CMS         6.6%
   77   -- EMI            12.2%
   78   -- Expat Services 16.5%
   79   -- Artemis        15.6%
   80   -- CEMS           38.0%
   81   -- LINGTEC        10.1%
   82   -- EGSNVC          6.1%
   83   -- LGMC            7.2%
   84   -- LRC            13.6%
   85   -- LGMI           14.0%
   86   -- LRCI           16.0%
   87   -- ECG             7.2%
   88   -- EnRock Mngt.    5.0%
   89   -- ECI Texas      75.0%
   90   -- EnRock         75.0%
   91   -- ECI Nevada     36.3%
   92   -- Alligator       5.0%
            Alley
   93   -- Enron Wind     16.7%
            Storm Lake I
   94   -- ECTMI          21.0%
   95   -- EnronOnline    12.0%
            LLC
   96   -- St. Charles     5.0%
            Development
   97   -- Calcasieu       5.0%
   98   -- Calvert City    5.0%
            Power
   99   -- Enron ACS       5.0%
  100   -- LOA            75.0%
  101   -- ENIL            5.8%
  102   -- EI              5.0%
  103   -- EINT            9.2%
  104   -- EMDE            6.7%
  105   -- WarpSpeed       5.0%
  106   -- Modulus        75.0%
  107   -- ETI            10.1%
  108   -- DSG             6.5%
  109   -- RMTC           75.0%
  110   -- Omicron         5.0%
  111   -- EFS I          75.0%
  112   -- EFS II          5.0%
  113   -- EFS III        75.0%
  114   -- EFS V           5.0%
  115   -- EFS VI          5.0%
  116   -- EFS VII        75.0%
  117   -- EFS IX         75.0%
  118   -- EFS X           9.5%
  119   -- EFS XI          7.2%
  120   -- EFS XII        15.5%
  121   -- EFS XV          5.0%
  122   -- EFS XVII       75.0%
  123   -- Jovinole        5.0%
  124   -- EFS Holdings   75.0%
  125   -- EOS            11.3%
  126   -- Green Power    75.0%
  127   -- TLS            14.5%
  128   -- ECT Securities 75.0%
            Limited
            Partnership
  129   -- ECT Securities 17.2%
            LP
  130   -- ECT Securities  5.0%
            GP
  131   -- KUCC Cleburne   5.0%
  132   -- EIAM           75.0%
  133   -- EBPHXI          5.0%
  134   -- EHC            75.0%
  135   -- EDM             6.0%
  136   -- EIKH           75.0%
  137   -- ECHVI          75.0%
  138   -- EIAC            7.2%
  139   -- EBPIXI          5.0%
  140   -- Paulista        5.0%
  141   -- EPCSC          10.7%
  142   -- Pipeline       14.6%
            Services
  143   -- ETPC           75.0%
  144   -- ELSC           75.0%
  145   -- EMMS            7.9%
  146   -- ECFL           75.0%
  147   -- EPGI            5.0%
  148   -- Transwestern    5.0%
            Gathering
  149   -- Enron           5.0%
            Gathering
  150   -- EGP             5.0%
  151   -- EAMR           37.2%
  152   -- EBP I          20.3%
  153   -- EBHL           23.8%
  154   -- Enron Wind      5.0%
            Storm Lake II
  155   -- EREC            9.8%
  156   -- EA III         20.2%
  157   -- EWLB           35.1%
  158   -- SCC            11.0%
  159   -- EFS IV         49.7%
  160   -- EFS VIII       75.0%
  161   -- EFS XIII       68.5%
  162   -- ECI             9.1%
  163   -- EPC            26.9%
  164   -- Richmond        5.0%
            Power
  165   -- ECTSVC         14.5%
  166   -- EDF            21.0%
  167   -- ACFI            8.0%
  168   -- TPC            75.0%
  169   -- APACHI         19.9%
  170   -- EDC            11.8%
  171   -- ETP             5.0%
  172   -- NSH            75.0%
  173   -- Enron South    18.7%
            America
  174   -- EGPP           51.9%
  175   -- PGS            30.9%
  176   -- PTC             5.0%

  177   Enron              0%      Distributions of:
        Subordinated
        Debenture                  (a) Pro Rata Share of the
        Claims                         Distributive Assets
                                       attributable to ENE; and

                                   (b) Pro Rata Share of 3,000,000
                                       Litigation Trust Interest
                                       and 3,000,000 Special
                                       Litigation Trust Interests;
                                       Subject to subordination
                                       Rights of senior debts.

                                       Impaired; entitled to vote.

  178   Enron Guaranty    12%      Distributions of Pro Rata Share
        Claims                     of the Enron Guaranty
                                   Distributive Assets.

                                   Impaired; entitled to vote.

  179   Wind Guaranty     29.7%    Distributions of Pro Rata Share
        Claims                     of the Wind Guaranty
                                   Distributive Assets.

                                   Impaired; entitled to vote.

  180   Intercompany     TBA       Distributions of Pro Rata Share
        Claims                     of the Intercompany Guaranty
                                   Distributive Assets.

                                   Impaired; not entitled to vote.

        Convenience                Payment in cash of the amount
        Claims against:            of the Convenience Claim
  181   -- EMC            53.0%    Distribution Percentage against
  182   -- ENE            13.0%    the particular Debtor.
  183   -- ENA            16.4%
  184   -- EPMI           19.2%    Impaired; entitled to vote.
  185   -- PBOG           67.5%
  186   -- SSLC           17.6%
  187   -- EBS            11.6%
  188   -- EESO            9.7%
  189   -- EEMC           26.0%
  190   -- EESI           25.2%
  191   -- EES            55.7%
  192   -- ETS            67.5%
  193   -- BAM             5.6%
  194   -- ENA Asset      67.5%
            Holdings
  195   -- EGLI           17.3%
  196   -- EGM             4.5%
  197   -- ENW             4.6%
  198   -- EIM             4.5%
  199   -- OEC            11.7%
  200   -- EECC           11.3%
  201   -- EEOSC           4.5%
  202   -- Garden State    4.5%
  203   -- Palm Beach      4.5%
  204   -- TSI             7.2%
  205   -- EESI           51.6%
  206   -- EESOMI         35.4%
  207   -- EFSI            4.5%
  208   -- EFM            22.0%
  209   -- EBS LP          4.5%
  210   -- EESNA           5.3%
  211   -- LNG Marketing  67.5%
  212   -- Calypso         4.5%
  213   -- Global LNG     67.5%
  214   -- EIFM           67.5%
  215   -- ENGMC          17.7%
  216   -- ENA Upstream   14.0%
  217   -- ELFI           26.4%
  218   -- LNG Shipping   67.5%
  219   -- EPSC            8.5%
  220   -- ECTRIC         16.8%
  221   -- Communications  6.7%
            Leasing
  222   -- Wind           29.0%
  223   -- Wind Systems   41.4%
  224   -- EWESC          39.7%
  225   -- Wind            5.2%
            Maintenance
  226   -- Wind           39.1%
            Constructors
  227   -- EREC I         41.4%
  228   -- EREC II        39.1%
  229   -- EREC III       39.7%
  230   -- EREC IV         5.2%
  231   -- EREC V         29.0%
  232   -- Intratex        4.5%
  233   -- EPPI            4.5%
  234   -- Methanol       12.5%
  235   -- Ventures        8.5%
  236   -- Enron           4.5%
            Mauritius
  237   -- India           4.5%
            Holdings
  238   -- OPP            67.5%
  239   -- NETCO          67.5%
  240   -- EESSH          17.7%
  241   -- Wind Dev't.    59.2%
  242   -- ZWHC           67.5%
  243   -- Zond Pacific    4.5%
  244   -- ERAC           67.5%
  245   -- NEPCO           7.5%
  246   -- EPICC           6.7%
  247   -- NEPCO Power     7.5%
            Procurement
  248   -- NEPCO Serv.     7.7%
            International
  249   -- San Juan Gas   19.4%
  250   -- EBF LLC        67.5%
  251   -- Zond           33.4%
            Minnesota
  252   -- EFII           26.6%
  253   -- E Power        33.0%
            Holdings
  254   -- EFS-CMS         5.9%
  255   -- EMI            11.0%
  256   -- Expat Serv.    14.8%
  257   -- Artemis        14.0%
  258   -- CEMS           34.2%
  259   -- LINGTEC         9.0%
  260   -- EGSNVC          5.5%
  261   -- LGMC            6.5%
  262   -- LRC            12.3%
  263   -- LGMI           12.6%
  264   -- LRCI           14.4%
  265   -- ECG             6.5%
  266   -- EnRock Mngt.    4.5%
  267   -- ECI Texas      67.5%
  268   -- EnRock         67.5%
  269   -- ECI Nevada     32.6%
  270   -- Alligator       4.5%
            Alley
  271   -- Enron Wind     15.0%
            Storm Lake I
  272   -- ECTMI          18.9%
  273   -- EnronOnline    10.8%
            LLC
  274   -- St. Charles     4.5%
            Development
  275   -- Calcasieu       4.5%
  276   -- Calvert City    4.5%
            Power
  277   -- Enron ACS       4.5%
  278   -- LOA            37.5%
  279   -- ENIL            5.2%
  280   -- EI              4.5%
  281   -- EINT            8.3%
  282   -- EMDE            6.0%
  283   -- WarpSpeed       4.5%
  284   -- Modulus        67.5%
  285   -- ETI             9.0%
  286   -- DSG             5.9%
  287   -- RMTC           67.5%
  288   -- Omicron         4.5%
  289   -- EFS I          67.5%
  290   -- EFS II          4.5%
  291   -- EFS III        67.5%
  292   -- EFS V           4.5%
  293   -- EFS VI          4.5%
  294   -- EFS VII        67.5%
  295   -- EFS IX         67.5%
  296   -- EFS X           8.5%
  297   -- EFS XI          6.5%
  298   -- EFS XII        13.9%
  299   -- EFS XV          4.5%
  300   -- EFS XVII       67.5%
  301   -- Jovinole        4.5%
  302   -- EFS Holdings   67.5%
  303   -- EOS            10.2%
  304   -- Green Power    67.5%
  305   -- TLS            13.0%
  306   -- ECT Securities 67.5%
            Limited
            Partnership
  307   -- ECT Securities 15.5%
            LP
  308   -- ECT Securities  4.5%
            GP
  309   -- KUCC Cleburne   4.5%
  310   -- EIAM           67.5%
  311   -- EBPHXI          4.5%
  312   -- EHC            67.5%
  313   -- EDM             5.4%
  314   -- EIKH           67.5%
  315   -- ECHVI          67.5%
  316   -- EIAC            6.5%
  317   -- EBPIXI          4.5%
  318   -- Paulista        4.5%
  319   -- EPCSC           9.6%
  320   -- Pipeline       13.2%
            Services
  321   -- ETPC           67.5%
  322   -- ELSC           67.5%
  323   -- MMS             7.1%
  324   -- ECFL           67.5%
  325   -- EPGI            4.5%
  326   -- Transwestern    4.5%
            Gathering
  327   -- Enron           4.5%
            Gathering
  328   -- EGP             4.5%
  329   -- EAMR           33.5%
  330   -- EBP-I          18.2%
  331   -- EBHL           21.4%
  332   -- Enron Wind      4.5%
            Storm Lake II
  333   -- EREC            8.8%
  334   -- EA III         18.2%
  335   -- EWLB           31.6%
  336   -- SCC             9.9%
  337   -- EFS IV         44.8%
  338   -- EFS VIII       67.5%
  339   -- EFS XIII       61.6%
  340   -- ECI             8.2%
  341   -- EPC            24.2%
  342   -- Richmond        4.5%
            Power
  343   -- ECTSVC         13.0%
  344   -- EDF            18.9%
  345   -- ACFI            7.2%
  346   -- TPC            67.5%
  347   -- APACHI         17.9%
  348   -- EDC            10.6%
  349   -- ETP             4.5%
  350   -- NHS            67.5%
  351   -- Enron South    16.9%
            America
  352   -- EGPP           46.7%
  353   -- PGS            27.8%
  354   -- PTC             4.5%

  355   Enron Guaranty    10.8%    Payment in cash of the amount
        Convenience                of the Convenience Claim
        Claims                     Distribution Percentage against
                                   Enron Guaranty Distributive
                                   Assets.

                                   Impaired; entitled to vote.

  356   Wind Guaranty     26.7%    Cash Payment of the amount of
        Convenience                the Convenience Claim
        Claims                     Distribution Percentage against
                                   Wind Guaranty Distributive
                                   Assets.

                                   Impaired; entitled to vote.

  357   Subordinated       0%      No distribution
   to   Claims                     Impaired; not entitled to vote.
  362

  363   Allowed Enron      0%      No distribution
        Preferred Equity           Impaired; not entitled to vote.
        Interests

  364   Enron Common       0%      No distribution
        Equity Interests           Impaired; not entitled to vote.

  365   Other Equity       0%      No distribution
        Interests                  Impaired; not entitled to vote.

Mr. Cooper explains that the Enron Preferred Equity Interests and
the Enron Common Equity Interests will be deemed cancelled and of
no force and effect and the Exchanged Stock will be issued in
lieu thereof.  On the latter to occur of the entry of a Final
Order resolving all Claims in the Chapter 11 cases and the final
distribution made to holders of Allowed Claims and Allowed Equity
Interests, the Exchanged Enron Preferred Stocks and the Exchanged
Enron Common Equity Stock will be deemed extinguished and the
certificates and all other documents representing the Equity
Interests will be deemed cancelled and of no force and effect.

According to Mr. Cooper, the estimates are very preliminary and
are based on information available to the Debtors as of June 1,
2003.  As the preliminary value of assets and amount of claims
used to calculate the estimated recoveries may be significantly
different than those ultimately realized, the actual distribution
under the Plan may be substantially higher or lower than the
estimated recoveries.

Mr. Cooper informs Judge Gonzalez that the Debtors used the
Blackstone Model in calculating the estimated recoveries.  The
Blackstone Model tracks the assets and liabilities of each Debtor
and most of other Enron Companies.  Taking into consideration,
among other things, the complex web of Intercompany claims and
equity interests between the Enron Companies, the model
calculates the asset value of each Debtor and the allocation of
that value to satisfy secured, administrative, prior and
unsecured Claims against each Debtor.  Furthermore, the Blackstone
Model was designed to permit the incorporation of numerous
variables reflecting different values and legal assumptions.

Other than cash on hand, the asset valuation information contained
in the Blackstone Model reflects either:

    (i) if the asset has been sold, the sale price, or

   (ii) if the asset has not been sold, an estimate developed by
        Blackstone and management.

This way, Mr. Cooper explains, a Debtor's assets may include
Cash, assets held for sale, assets identified for transfer into
InternationalCo, claims and causes of action, and investments in
subsidiaries.  Due to the inherent uncertainty of litigation, for
estimating asset value purposes, no value is ascribed to any
claims or causes of actions the Debtors may have.

The claims estimates included in the Blackstone Model were
estimated using these procedures:

    (i) Administrative, Secured and Priority Claims, including
        administrative claims against other Debtors, have been
        estimated by the Debtors based on historical expense
        levels, filed Claims and the Debtors' books and records;

   (ii) Intercompany Claims are based on the intercompany
        accounts and notes reflected in the Debtors' books and
        records, as may be adjusted from time to time; and

  (iii) all other Claims are based on filed Claims, the Debtors'
        books and records and analysis performed by the Debtors
        and their professionals. (Enron Bankruptcy News, Issue No.
        75; Bankruptcy Creditors' Service, Inc., 609/392-0900)


EXIDE TECHNOLOGIES: Court Fixes Aug. 15 as Contaminant Bar Date
---------------------------------------------------------------
Gould Electronics Inc. has contaminant-related claims against the
Debtors as a result of Exide Technologies' purchase of GNB
Batteries stock from Pacific Dunlop in 2000.  In 1983, Gould
transferred the assets and liabilities of its battery
manufacturing business to GNB, which in turn sold its stock to
Pacific Dunlop.  As a result, GNB has become, and is, Exide
Technologies.

Subsequent to the sale of the Battery Business, disputes arose
between Gould and GNB regarding environmental liability resulting
from the Battery Business.  In 1994, Gould obtained a declaration
by a federal district court that GNB was liable under the CERCLA
and under a January 1, 1983 Restated Assumption Agreement for all
of the environmental liabilities of the Battery Business,
including those that arose before the sale.  The Assumption
Agreement was executed as part of the sale.  The District Court
decision was affirmed by the 7th Circuit.

Notwithstanding its obligation to pay all environmental and other
claims associated with the Battery Business, Exide has indicated
that it does not intend to pay all those claims.  Exide also has
ceased funding certain environmental cleanup obligations at sites
related to the Battery Business.  It is likely that the United
States Environmental Protection Agency and certain other parties
will look to Gould to fund obligations that Exide refuses to pay.
In this event, Gould will have significant claims against Exide.

The April 23, 2003 General Bar Date Order specifically excluded
Contaminant-Related Claims and provided that any claims of Gould
were to be treated the same as Contaminant-Related Claims.
Accordingly, Gould was not required to file, and has not yet
filed, a proof of claim asserting any claims against the Debtors.

The exception provided for Gould's claims was premised, in large
part, on the amount of information gathering and document review
required before Gould could assert its claim against the Debtors.
Gould simply was not, and could not have been, in a position to
assert its claims against the Debtors by the April 23, 2003
deadline.  The additional time provided to Gould was based on an
expectation that it would be provided information and access to
documents and individuals sufficient to allow it to determine the
nature and amount of its claims.  That expectation has not been
met.  Despite reasonably diligent efforts on the Debtors' part,
Gould has not had sufficient access to information, documents,
and individuals to allow it to determine its claims. Accordingly,
Gould is not presently in a position to file a meaningful proof of
claim.  It also appears unlikely that Gould will be in a position
to do so by the proposed August 15, 2003 Contaminant-Related
Claims Bar Date.

Consequently, Gould objects to the proposed Contaminant-Related
Claims Bar Date.  Gould points out that the Debtors possess or
control the information and documents required to assert its
claims.  But Gould has been stymied in its efforts to obtain
those documents -- stymied by a lack of enthusiasm by the
Debtors' personnel and by the assertion of various confidentiality
restrictions.

"Gould is not alleging that the Debtors have intentionally
thwarted Gould's information-gathering efforts.  That lack of
intent, however, does not change the fact that Gould has been
unable to compile and review all of the information and documents
it requires," Duane D. Werb, Esq., at Werb & Sullivan, Wilmington,
Delaware, tells the Court.

Based on the current level of cooperation by the Debtors and the
estimates of Gould's consultants, Gould believes that it should
be able to file a proof of claim by October 1, 2003 -- 45 days
after the date the Debtors proposed.

                         *     *     *

Judge Carey orders that all contaminant-related personal injury
claims or contaminant-related property damage claims against the
Debtors' estates must be filed by August 15, 2003.  Judge Carey
however exempts St. Paul from providing certain information on
the Proof of Claim Form with respect to surety-related claims.

The Debtors have resolved Gould's Objection through a separate
letter agreement. (Exide Bankruptcy News, Issue No. 27; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


FHC HEALTH SYSTEMS: S&P Rates Counterparty Credit Rating at B
-------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B' counterparty
credit rating to FHC Health Systems Inc.

At the same time, Standard & Poor's assigned its 'B' debt rating
to both FHC's $30 million senior secured revolving credit facility
and its $250 million senior unsecured redeemable debentures, which
are due in 2011.

The outlook is stable.

FHC intends to use the net proceeds of this offering to refinance
existing debt and preferred stock obligations.

"The rating actions reflect FHC's extremely weak capitalization,
weak financial flexibility somewhat offset by marginal earnings,
and an average business position," said Standard & Poor's credit
analyst Steven Ader. "The secured debt and debentures are rated
the same, reflecting Standard & Poor's criteria regarding relative
support of the underlying collateral for the respective issues."

Pretax earnings, after debt servicing, are projected to be about
$35 million and $18 million in 2003 and 2004, respectively. The
decline in 2004 earnings are the result of Standard & Poor's
expectation that the renewal terms on the large public sector
contract constituting 29% of consolidated revenue in 2002, will
result in reduced profitability. Fixed-charge coverage is expected
to be between 1.2 and 1.4x. Debt to capital is expected to remain
near current levels.

FHC Health Systems Inc., a Norfolk, Va.-based organization
incorporated in 1983, is a behavioral healthcare company that
offers behavioral health insurance and behavioral health provider
services through two primary subsidiaries, ValueOptions and
Alternative Behavioral Services. ValueOptions provides mental
health, substance abuse, integrated mental health/substance abuse,
and employee assistance programs to about 23 million people as of
April 2003. Alternative Behavioral Services provides services
through psychiatric hospitals, residential treatment centers,
therapeutic group homes, foster care family settings, alternative
schools, outpatient offices, and home visits.


GAUNTLET ENERGY: Canadian Court Extends CCAA Stay Until Aug. 29
---------------------------------------------------------------
Gauntlet Energy Corporation said that the stay of proceedings
preventing creditors' actions against it has been extended by the
Court of Queen's Bench of Alberta to August 29, 2003. Gauntlet's
banker, which is its primary secured creditor and the Court
appointed Monitor supported the application to the Court for the
extension.

Gauntlet's progress in developing a financial restructuring plan
will be reviewed by the Court on August 29, 2003, at which time it
is expected Gauntlet will be requesting a further extension of the
creditor protection Order.


GENERAL BINDING: Q2 Earnings Results Enter Negative Territory
-------------------------------------------------------------
General Binding Corporation (Nasdaq: GBND) announced results for
the second quarter of 2003. Total segment operating income for the
quarter was comparable to the level posted last year, despite a
sales decline of 1.8% reflecting the continuing weak economy. In
addition, the Company reported a net loss for the quarter of $0.32
per share, including a pre-tax charge of $8.4 million for certain
cost improvement initiatives, compared to net income last year of
$0.13 per share, which included $1.7 million of charges.

In response to the soft sales environment and to improve its
profitability, GBC announced several initiatives during the
quarter. These initiatives are anticipated to generate over $2
million of profitability improvement in 2003, and more than $10
million of annualized improvement after the expected completion of
the initiatives in mid-year 2004. The Company reported $8.4
million of charges related to these initiatives in the second
quarter. GBC also announced the refinancing of its senior credit
facility during the quarter, which, together with two other recent
financings, are expected to generate over $4 million of annualized
interest payment savings.

"The weak economy continues to affect sales in certain areas of
our business," said Dennis Martin, GBC's Chairman, President and
CEO. "However, the Operational Excellence initiatives we undertook
throughout the organization last year to generate cost savings and
increases in productivity levels have helped considerably to
stabilize our results this year. The new programs we recently
announced should contribute significant improvements in GBC's
efficiencies and profitability."

                    2nd Quarter 2003 Results

Financial results for the quarter included the following
highlights:

-- Sales in the quarter totaled $171.2 million, down $3.2 million,
   or 1.8%, from the second quarter of 2002. International sales
   within the Groups were positively affected by exchange rate
   movements. Sales in the Commercial and Consumer Group declined
   by $4.9 million, or 4.2%, in the quarter over the prior year,
   due primarily to continuing lower demand in visual
   communication products, partially offset by growth in the 3-
   ring binder business. The Industrial and Print Finishing
   Group's sales were down $0.9 million, or 2.7%, as lower
   domestic commercial films sales were not completely offset by
   higher international sales. Sales in the Europe Group were up
   $2.6 million, or 11.7%, primarily due to favorable exchange
   rates.

-- The Company's gross profit for the quarter decreased by $1.6
   million, or 0.2 points over the prior year to 39.8%, primarily
   related to the adverse effect of lower sales volumes and
   certain mix changes in the Commercial and Consumer Group,
   partially offset by the favorable impact of Operational
   Excellence initiatives.

-- Selling, service and administrative expenses were down $1.9
   million, or 3.3%, in the quarter compared to prior year,
   primarily due to lower levels of discretionary spending and
   variable expenses, partially offset by the adverse effect of
   exchange rate movements on international expenses.

-- Total segment operating income for the quarter was roughly flat
   compared to last year at $11.6 million. Operating income in the
   Commercial and Consumer and the Industrial and Print Finishing
   Groups were down $2.7 million and $0.7 million, respectively,
   as a result of lower sales and lower gross profit margins. The
   Europe Group's operating income was up $1.9 million due
   primarily to the favorable effect of exchange rates and lower
   costs.

-- Restructuring expense in the quarter totaled $8.4 million. This
   expense was related to the manufacturing rationalization and
   workforce reduction programs detailed below. In the second
   quarter of 2002, restructuring and other charges totaled $1.7
   million.

-- Interest expense in the quarter totaled $10.2 million, roughly
   flat to the $10.0 million from the prior year. Included in
   interest expense for the quarter was $1.1 million related to
   the loss on the extinguishment of the Company's prior credit
   facility which was refinanced in June 2003.

-- A net loss was reported for the quarter of $0.32 per share,
   including a pre-tax charge of $8.4 million for the
   aforementioned cost improvement initiatives, compared to net
   income last year of $0.13 per share, which included $1.7
   million of charges.

-- Total net debt at the end of the quarter, adjusted for cash and
   equivalents, was $334 million, up roughly $11 million from the
   amount outstanding at the beginning of the year.

                       Six-Month Results

For the first six months of 2003, sales were $340.6 million, down
1.7% from the same period last year. The net loss for the period
was $0.32 per share, including pre-tax charges totaling $9.8
million. For the same period last year, the Company reported a net
loss of $5.23 per share, including charges of $6.6 million and the
cumulative effect of accounting changes totaling $79 million.

                        Company Comments

"In response to the continuing weak economy, we have continued to
look hard at our organization to improve our profitability,"
continued Mr. Martin, "and we recently announced several major
initiatives that should reduce expenses and realign a portion of
our manufacturing operations for improved profitability and
efficiencies."

"We also significantly improved our capital structure by
completing the refinancing of our senior credit facility during
the quarter," continued Mr. Martin. "This was an important
financial milestone for GBC. We enhanced our financial flexibility
by significantly reducing our interest payments and achieving a
maturity date of January 2008."

"Overall," Mr. Martin concluded, "the successful implementation of
GBC's Operational Excellence initiatives has helped us weather the
lack of top line growth. We are confident that the new initiatives
we undertook this quarter and our continuing focus on long-term
sales and marketing initiatives position us well to drive growth
in shareholder value as the economy improves."

               Recent Actions To Improve Profitability

On July 17, the Company announced several measures to improve its
cost structure and reduce its expenses. These initiatives are
anticipated to generate over $2 million of profitability
improvement in 2003 and more than $10 million of annualized
improvement after the expected completion of the initiatives in
mid-year 2004, and they include:

-- Booneville, MS Manufacturing Rationalization -- As part of its
   ongoing Operational Excellence Program, GBC has begun
   relocating certain labor-intensive office products
   manufacturing operations from its Booneville facility to its
   Nuevo Laredo, Mexico facility and outsourcing several other
   product lines. As a result, the Booneville workforce will be
   reduced by about 250 employees from a total of 660 over the
   next 12 months.

-- Workforce Reduction Program - In addition to the workforce
   reduction actions in Booneville, the Company has recently
   completed a reduction in staffing of about 115 employees at
   other GBC locations, bringing the total number of employees
   affected company-wide to approximately 365, or about 9% of
   GBC's total employees.

The Company expects to take charges totaling approximately $9.5
million related to these cost reduction programs, of which $8.4
million was recognized in the second quarter of 2003. The cash
portion of the charges is estimated at about $4 million,
principally related to severance expenses. The remaining charges
will be non-cash and are mainly related to asset impairments at
the Booneville facility.

               Senior Credit Facility Refinancing

On June 30, GBC announced the refinancing of its primary senior
credit facility. The new $197.5 million facility includes a $72.5
million multicurrency revolving credit line and a $125 million
term loan. The maturity date on the new facility is January 15,
2008, and it provides for significantly lower interest rates
compared to the previous facility. The facility, led by Harris
Bank, LaSalle Bank and General Electric Capital Corporation,
should provide the financial flexibility and liquidity to support
all of GBC's currently anticipated operating and capital
requirements.

GBC was successful in reducing the size of the new facility by
more than $90 million from the previous facility primarily as a
result of debt reduction achieved through the successful execution
of its Operational Excellence Program and approximately $30
million of aggregate proceeds from two other recent financings.
The annualized interest payment savings from these financings is
expected to be more than $4 million.

                    Financial Reporting Changes

Beginning with its second quarter results, the Company's financial
reporting has been modified to reflect the strategic
organizational restructuring announced in late-2002. This change
more closely aligns GBC's marketing, sales and support functions
around its key customers and end-consumers and eliminates
operational overlap. The realignment primarily consisted of
combining three of the Company's four business units into the
following two new Groups:

-- Commercial and Consumer Group (combination of the Document
   Finishing Group, Office Products Group, the Education division
   and the Asia/Pacific region). This combined group will focus on
   branding and marketing strategies for "consumer-ready" products
   that leverage GBC's leadership among customers of its binding,
   laminating and information-display products in the work, school
   and home environments.

-- Industrial and Print Finishing Group (combination of the Films
   Group and the Automated Finishing division). This combined
   group will target print-for-pay and other finishing customers
   who use GBC's professional-grade finishing equipment and
   supplies as part of their mass production or sophisticated,
   professional applications.

GBC is a world leader in products that bind, laminate, and display
information enabling people to accomplish more at work, school and
home. GBC's products are marketed in over 100 countries under the
GBC, Quartet, and Ibico brands, and they help people enhance
printed materials and organize and communicate ideas.

As reported in Troubled Company Reporter's July 2, 2003 edition,
Standard & Poor's Ratings Services assigned its senior secured
'B+' rating to office supplies manufacturer General Binding
Corp.'s $197.5 million bank facility. At the same time, Standard &
Poor's affirmed its 'B+' corporate credit and 'B-' subordinated
debt ratings on the company.

Total debt outstanding at March 31, 2003, was $336.1 million.

The outlook on the Northbrook, Illinois-based General Binding is
stable.


GRISTEDE'S FOODS: S&P Rates Planned $150M Sr. Secured Notes at B
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned a 'B' rating to
Gristede's Foods Inc.'s planned $150 million senior secured note
offering due in 2010. A 'B' corporate credit rating was also
assigned to the company. The outlook is negative.

The notes will be secured by a second lien on substantially all of
the company's assets and capital stock of subsidiaries and would
be subordinated to any security pledged to a new revolving credit
facility. The notes will be issued under Rule 144A with
registration rights.

New York, New York-based Gristede's plans to use the majority of
the proceeds from the note offering to purchase Kings Super
Markets Inc. from Marks & Spencer PLC for $120 million in cash.

"The acquisition would expand the company's markets to northern
New Jersey from New York City, and provide opportunities for
Gristede's to leverage Kings' expertise in perishable and prepared
food offerings," said credit analyst Patrick Jeffrey. As part of
the transaction, Di Giorgio Corp. will contribute $10 million in
exchange for a 10-year supply agreement with Gristede's.

The ratings on Gristede's reflect its participation in the highly
competitive supermarket industry, its small sales and earnings
base compared to other operators, the integration risk related to
the Kings acquisition, and the company's high leverage. These
risks are mitigated, somewhat, by Gristede's leading market
position in the New York City market.

Liquidity is marginal and is based on the company securing a $20
million revolving credit facility within 30 to 60 days of the
senior secured notes closing. An interim $5 million facility would
be utilized by the company if the revolving credit facility were
not in place at the time the senior notes are funded. Gristede's
had pro forma cash balances of $3.6 million as of March 29, 2003.
However, debt maturities are minimal over the next few years.

Standard & Poor's believes there are inherent risks in Gristede's
integrating a large acquisition such as Kings. Because the
combined entity will have a relatively small sales and earnings
base, the ratings could be lowered if credit protection measures
and liquidity are negatively affected by integration or
competitive factors. The ratings could also be lowered if the
company is not able to obtain a $20 million revolving credit
facility within 30 to 60 days of the senior secured notes closing.


HARBISON-WALKER: Court Extends Halliburton Stay to Sept. 30
-----------------------------------------------------------
Halliburton (NYSE: HAL) announced that the Harbison-Walker
bankruptcy court approved an agreement among DII Industries,
Harbison-Walker Refractories Company and the Official Committee of
Asbestos Creditors that extends the court's temporary restraining
order through September 30, 2003.

The temporary restraining order will expire if a pre-packaged
Chapter 11 filing by Halliburton's subsidiaries DII Industries,
Kellogg Brown & Root and certain of their subsidiaries is not made
on or prior to September 30, 2003. The parties to the agreement,
however, retain the right to request the bankruptcy court to
extend the stay beyond September 30, 2003. Should the stay expire
on September 30, 2003, the court established that discovery on the
stayed claims cannot begin until November 1, 2003, and trial dates
cannot be set before January 1, 2004. The court's temporary
restraining order, which was originally entered on February 14,
2002, stays more than 200,000 pending asbestos claims against DII
Industries.

In December 2002, Halliburton announced that it had reached an
agreement in principle that, if and when consummated, would result
in a settlement of asbestos and silica personal injury claims
against DII Industries, Kellogg Brown & Root and their current and
former subsidiaries with U.S. operations.

Halliburton, founded in 1919, is one of the world's largest
providers of products and services to the petroleum and energy
industries. The company serves its customers with a broad range of
products and services through its Energy Services Group and
Engineering and Construction Group business segments. The
company's World Wide Web site can be accessed at
http://www.halliburton.com


HARTZ MOUNTAIN: S&P Cuts Corporate Credit Rating Down 2 Notches
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
and senior secured debt ratings on The Hartz Mountain Corp. to 'B'
from 'BB-".

At the same time, the ratings were placed on CreditWatch with
negative implications. Secaucus, N.J.-based Hartz Mountain is a
manufacturer and marketer of a wide variety of pet supplies. Total
debt outstanding at March 31, 2003, was about $190 million.

"The rating actions reflect Hartz Mountain's continued
weaker-than-expected operating performance, which has resulted in
credit measures that are significantly below the current rating
level," said Standard & Poor's credit analyst Jean C. Stout. The
company's performance has been impacted by a weak economy and the
consolidation in the retail industry, which has resulted in an
increasingly consolidated retail base and the on-going shift to
mass merchandisers, which has pressured pricing.

In addition, during the second quarter of 2003, adverse weather
conditions negatively affected sales of higher-margin flea and
tick treatments. At the same time, as a result of the weak
financial results, Hartz Mountain is in discussions with its bank
group to amend financial covenants, as it does not expect to be in
compliance for the quarter ended June 2003 or for the remainder of
the year.

The negative CreditWatch listing incorporates the possibility that
the ratings could be lowered further if Hartz Mountain's banks
fail to provide the company with adequate financial flexibility.
Standard & Poor's will monitor the company's success in
discussions with its banks prior to taking further rating action.


HILCORP ENERGY: S&P Rates Proposed $350 Million Sr. Notes at 'B'
----------------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB-' corporate
credit rating to petroleum company Hilcorp Energy I L.P. Standard
& Poor's also assigned its 'B' rating to Hilcorp's proposed $350
million senior unsecured notes maturing in 2010. The outlook on
Hilcorp is stable.

Texas-based Hilcorp will have about $510 million of total debt pro
forma for the notes offering.

"The ratings on Hilcorp reflect a below-average business profile
and aggressive financial leverage," noted Standard & Poor's credit
analyst Scott A. Beicke. "The cyclical and capital-intensive
nature of the petroleum industry contributes to Hilcorp's below-
average business profile," he continued.

Hilcorp's business profile is supported by a proven history of low
finding costs, a strong operational record, and control of nearly
90% of its net production. The relatively low decline rates
associated with Hilcorp's properties provide a degree of stability
to the small reserve base. In addition, the company's aggressive
hedging program serves to mitigate commodity price risk. Material
price hedging at favorable prices should stabilize near-to-medium-
term cash flows and lessen the risks that accompany Hilcorp's
acquisition strategy.

Hilcorp's liquidity will be adequate, with access to a secured
credit facility maturing in July 2006 and no other debt maturities
due until 2010. The company will have the ability to borrow
roughly $64 million under its bank credit agreement as of the
close of the notes issuance. Hilcorp should safely meet the
facilities' requirements, which include covenants dealing with
debt to EBITDA, interest coverage, and the current ratio.

The stable outlook reflects expectations that Hilcorp will
prudently manage its financial profile. The company has stated
that it intends to use near-term cash flow to reduce debt
outstanding under its credit facility. Failure to improve
financial metrics, given the currently favorable commodity price
environment, would pressure the company's rating. If Hilcorp
experiences significant operational disappointments or fails to
reduce its debt level over the near term, the company's ratings or
outlook could change.


IMPERIAL PLASTECH: Misses Deadline to File Financials
-----------------------------------------------------
Imperial PlasTech Inc. (TSX: IPQ) announced that as a result of
its restructuring under the Companies' Creditors Arrangement Act
it will be late in filing its interim financial statements for the
six months ended May 31, 2003. Imperial PlasTech is required to
file these interim financial statements by July 30, 2003.

On June 12, 2003, the PlasTech Group, comprised of Imperial
PlasTech and its subsidiaries, Imperial Pipe Corporation, Imperial
Building Products Corporation, Ameriplast Inc. and Imperial
Building Products (U.S.) Inc., was placed into receivership by its
secured operating lender following a demand for repayment. Shortly
after being placed into receivership, the Board of Directors and
all Senior Officers of the PlasTech Group resigned.

In order to prevent liquidation and to restructure the PlasTech
Group, A.G. Petzetakis SA, a significant shareholder of Imperial
PlasTech, acquired all of the indebtedness of the PlasTech Group
owed to that lender. A.G. Petzetakis then took the initiative in
assisting the PlasTech Group to emerge from receivership and to
obtain protection from creditors under the CCAA on July 3, 2003,
in order to facilitate the restructuring and continued operations
of the PlasTech Group as a going concern. On July 11, 2003, a
Second Order was obtained under the CCAA to approve an outsourcing
arrangement with A.G. Petzetakis in order to assist it in
fulfilling certain obligations, the terms of the engagement of the
Chief Restructuring Officer of the PlasTech Group, and the
retainer of Canadian counsel and U.S. counsel to the PlasTech
Group.

In accordance with the terms of the Initial Order dated July 3,
2003 and the Second Order dated July 11, 2003 issued under the
CCAA, the PlasTech Group sent notice of the CCAA proceedings,
including a copy of the Initial Order and the Second Order, to the
known creditors of the PlasTech Group, other than employees and
creditors to which the PlasTech Group owe less than $5,000, on or
before July 17, 2003. The PlasTech Group intends to file a
proposal for a plan or plans of compromise or arrangement between
the PlasTech Group and one or more classes of their secured and/or
unsecured creditors as they deem appropriate prior to the
expiration of the stay period imposed under the CCAA.

Since the Board of Directors and all Senior Officers of the
PlasTech Group had resigned, the court appointed Messrs. Peter J.
Perley, Mark Weigel, and William Thomson under the CCAA as
directors of Imperial PlasTech. The court also appointed Mr.
Perley under the CCAA as Chief Restructuring Officer of the
PlasTech Group, to restructure the PlasTech Group, and appointed
Richter & Partners Inc. under the CCAA as Monitor, to monitor the
property and the conduct of the business of the PlasTech Group.

As a result of the restructuring of the PlasTech Group and the
resignation of the former Board of Directors and Senior Officers
of the PlasTech Group, the court appointed Board is not
sufficiently familiar with, and has not had a sufficient
opportunity to review and analyze, the financial condition of the
PlasTech Group in order to complete the interim financial
statements of Imperial PlasTech for the six months ended May 31,
2003. Imperial PlasTech is working with its auditors, Deloitte
Touche, to complete the interim financial statements as soon as
possible. Imperial PlasTech anticipates that the financial
statements will be filed on or prior to September 30, 2003.

The Ontario Securities Commission may impose a cease trade order
if the interim financial statements have not been filed by
September 30, 2003. Imperial PlasTech intends to satisfy the
provisions of the Alternate Information Guidelines of the Ontario
Securities Commission so long as Imperial PlasTech is in default
of filing its interim financial statements, including issuing a
news release every two weeks in order to keep the market informed
of any developments during this time.

Imperial PlasTech intends to file with the Ontario Securities
Commission, during the period that Imperial PlasTech is in default
of filing its interim financial statements, the same information
it provides to its creditors at the times the information is
provided to its creditors and in the same manner as it would file
a material change report under the Securities Act.

The PlasTech Group is a diversified plastics manufacturer
supplying a number of markets and customers in the residential,
construction, industrial, oil and gas and telecommunications and
cable TV markets. Currently operating out of facilities in
Edmonton Alberta and Atlanta Georgia, the PlasTech Group intends
to focus on the growth of its core businesses while assessing any
non-core businesses. For more information, access the group's Web
site at http://www.implas.com


INTEGRATED HEALTH: Resolves Claims Dispute with BT Off. Products
----------------------------------------------------------------
Integrated Health Services, Inc., and its debtor-affiliates ask
the Court to approve their stipulation with BT Office Products
International now known as Corporate Express Office Products,
Inc., settling their adversary proceeding.

On January 31, 2002, Integrated Health Services, Inc. filed a
complaint against BT Office Products to recover preferential and
fraudulent conveyances made to BT Office products amounting to at
least $421,811.  In response, BT Office Products asserted the
subsequent advance of new value and ordinary course of business
affirmative defenses.  After an exchange of information and
documentation regarding the Transfers and BT Office Products'
defenses to the avoidability of the Transfers, the parties agreed
to resolve the adversary proceeding consensually to avoid the
costs and uncertainties of litigation.

Pursuant to the Stipulation and in settlement of the Adversary
Proceeding, BT Office Products will pay the Debtors $14,577.  The
parties will exchange mutual releases.  BT Office Products has
also agreed to withdraw its claim for $1,071,135.70.  In addition,
the Adversary Proceeding will be dismissed.

Alfred Villoch, III, Esq., at Young, Conaway, Stargatt & Taylor,
LLP, in Wilmington, Delaware, tells the Court that the Stipulation
enables the Debtors to receive substantially all of the relief,
which they could have reasonably expected to receive from
prosecuting the Adversary Proceeding. (Integrated Health
Bankruptcy News, Issue No. 61; Bankruptcy Creditors' Service,
Inc., 609/392-0900)


INTERNET INFINITY: Hires Kabani & Co. to Replace Caldwell Becker
----------------------------------------------------------------
On July 2, 2003 Caldwell, Becker, Dervin, Petrick & Co., L.L.P.,
the principal independent accountants of Internet Infinity, Inc.,
resigned.

The reports of Caldwell, Becker, Dervin, Petrick & Co., L.L.P. on
the financial statements of Internet Infinity for each of the past
two years ended March 31, 2003 and 2002 contained explanatory
paragraphs describing an uncertainty about Internet Infinity's
ability to continue as a going concern.

On July 9, 2003, Internet Infinity engaged Kabani & Company, Inc.,
as its new principal accountant to audit its consolidated
financial statements.


JP MORGAN COMM'L: Fitch Affirms Low-B Ratings on 3 Note Classes
---------------------------------------------------------------
Standard & Poor's Ratings Services raised its ratings on four
classes of J.P. Morgan Commercial Mortgage Finance Corp.'s
mortgage pass-through certificates series 1999-C7. At the same
time, ratings are affirmed on four classes from the same series.

The rating actions reflect a loan pool that has performed well,
with an improved weighted average debt service coverage for year-
end 2002 (92% of loans reporting) of 1.59x compared to 1.42x at
issuance. As of June 2003, the loan pool had paid down 12% since
issuance, with a current balance of $715.12 million and 142 fixed-
rate loans (average mortgage rate is 7.214%); the loan pool
balance at issuance was $808.77 million with 145 loans. In
addition, there were no delinquent loans in June 2003, nor any
realized losses.

As of June 2003, the master servicer, Midland Loan Services Inc.
(Midland) placed 32 loans on its watchlist ($171.73 million,
24.0%). Thirteen of the loans ($69.68 million, 9.7%) reported DSC
ratios below 1.0x (includes fifth and seventh largest loan); 17
loans ($90.22 million, 12.6%) reflect a decline in occupancy at
the properties; and two loans ($11.83 million, 1.7%) secured by
retail properties due to the bankruptcy filing of Kmart and store
closings of Food Lion; however, these stores remain open.

The following three loans (from the top 10) are of concern to
Standard & Poor's:

-- The largest loan ($51.8 million, 7.3%) is secured by six
   anchored retail centers, which are cross-collateralized and
   cross-defaulted, located in New Jersey, Florida, Illinois,
   South Carolina, and Maryland. Since issuance, anchors at three
   of the retail centers have vacated due to bankruptcy or store
   closings. Consequently, the year-end 2002 weighted average DSC
   declined to 1.14x from 1.52x at issuance, and the April 2003
   weighted average occupancy decreased to 76.7% from 96.0%. Mills
   Corp., a publicly traded real estate investment trust, controls
   the borrower.

-- The fifth largest loan ($17.6 million, 2.5%), secured by a
   287,336-square-feet (sq. ft.) office building in Baltimore,
   Md., reported a February 2003 decline in occupancy to 67% from
   95% occupancy at issuance, mainly due to the borrower being
   unsuccessful in re-leasing approximately 161,000 sq. ft. since
   losing a major tenant in March 2001. The year-end 2002 DSC
   declined to 0.54x from 1.47x at issuance. However, in July
   2003, the borrower reported that a lease has been signed for
   49,000 sq. ft., which increases the occupancy to 85%.

-- The seventh-largest loan ($14.7 million, 2.1%), secured by
   three multifamily properties with 532 units in Greenville,
   S.C., and Charlotte, N.C. Both markets are losing tenants due
   to the low mortgage interest rates; however, the borrower
   continues to offer concessions to attract tenants. The weighted
   average year-end 2002 DSC declined to 0.66x from 1.35x at
   issuance, and the average March 2003 occupancy was 70% compared
   to 88% at issuance.

Standard & Poor's stressed the weaker performing watchlist loans
in its analysis, and the stressed credit enhancement levels
adequately support the assigned ratings.

The loan pool remains diverse with multiple property types that
include multifamily (32%), retail (23%), office (19%), and hotel
(10%). The pool also remains geographically diverse with
properties located in 30 states; only two states, California and
Florida, have concentrations in excess of 10%, at 17.5% and 11.5%,
respectively.

                         RATINGS RAISED

          J.P. Morgan Commercial Mortgage Finance Corp.
            Mortgage pass-thru certs series 1999-C7

                        Rating
          Class     To          From     Credit Support (%)
          B         AA+         AA                   27.45
          C         A+          A                    21.85
          D         BBB+        BBB                  14.57
          E         BBB         BBB-                 12.89

                         RATINGS AFFIRMED

          J.P. Morgan Commercial Mortgage Finance Corp.
            Mortgage pass-thru certs series 1999-C7

          Class     Rating     Credit Support (%)
          A-1       AAA                    33.06
          A-2       AAA                    33.06
          G         B                       3.92
          H         B-                      3.36
          F         BB                      7.56
          X         AAA                      N/A


KERR GROUP: S&P Assigns BB- Speculative Grade Credit Rating
-----------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'BB-' corporate
credit rating to plastic closure and container producer Kerr Group
Inc. The outlook is stable.

At the same time, Standard & Poor's assigned its 'BB-' rating to
the company's proposed $205 million senior secured bank facility,
based on preliminary terms and conditions. With pro forma annual
revenues of about $343 million, Lancaster, Pennsylvania-based Kerr
is a domestic producer of closures for the healthcare and food and
beverage segments, and pharmaceutical bottles and prescription
vials. Pro forma debt outstanding will be about $215 million.

"The company's below-average business position benefits from its
decent market shares in relatively recession-resistant healthcare,
food, and beverage niches, well-established customer
relationships, and attractive operating profitability," said
Standard & Poor's credit analyst Liley Mehta. "Offsetting factors
include the company's limited scale of operations, a highly
fragmented industry structure, significant competition from large,
globally diversified packaging suppliers and integration risks
related to its acquisitions."


KINDERCARE LEARNING: $125 Million Credit Facility Rated 'B+'
-----------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'B+' bank loan
rating to KinderCare Learning Centers Inc.'s senior secured $125
million revolving credit facility due in July 2008. At the same
time, Standard & Poor's affirmed its 'B+' corporate credit rating
and 'B-' subordinated debt rating.

"The speculative grade ratings continue to reflect KinderCare's
leading business position in the highly fragmented child-care
industry," said credit analyst Michael J. Kaplan. The company's
position is overshadowed by recent, significant weak demand trends
for child-care services, industry threats, and the consolidated
company's heavy debt burden. The outlook is negative.

Following the transaction, KinderCare, on a consolidated basis,
will have approximately $550 million of debt outstanding.

The new credit facility replaces a $390 million term loan and
revolving credit facility that was due to expire in February 2004.
The term loan and revolving credit facility and a $100 million
synthetic lease facility were refinanced by a $300 million
mortgage loan due July 2008 (with a one-year renewal option), from
Morgan Stanley Mortgage Capital Inc. The borrower of this loan is
a newly formed, single-purpose bankruptcy remote entity known as
KC PropCo. The mortgage loan is secured by 475 KinderCare early
education and childcare centers. KinderCare also may use the
balance of the proceeds from the mortgage loan to purchase up to
$37 million of its $300 million 9-1/2% subordinated notes due
2009.

The new $125 million revolving credit facility is secured by a
first mortgage lien or first trust deed on land and improvements
at childcare centers, which on March 7, 2003 had an estimated
market value of $130 million and book value of $65.8 million, and
perfected first-priority security interests in all accounts
receivable and intellectual property of the borrower, other than
those owned by KC PropCo. The bank loan rating in the same as the
corporate credit rating indicating that there is a strong
likelihood of substantial, but not full, recovery of principal in
the event of default, given the value of collateral.

Portland, Ore.-based KinderCare is the largest provider of
proprietary center-based preschool education and child-care
services in the U.S., with 1,266 facilities in 39 states and two
centers in the U.K.


LEAP WIRELESS: Court OKs Irell & Manella as Committee's Counsel
---------------------------------------------------------------
The Official Committee of Unsecured Creditors of Leap Wireless
International Inc., and its debtor-affiliates, wants to retain
Irell & Manella LLP as co-counsel to the Committee nunc pro tunc
to the Petition Date.

Committee Chairman Neil Subin relates that Irell & Manella is
comprised of attorneys whose practice includes, among other
things, the areas of bankruptcy, creditors' rights, real estate,
labor, litigation, and tax.  The Firm is well qualified to render
specialized services to the Committee in these cases.  Irell's
attorneys who will render services to the Committee are duly
licensed to practice law in the courts of the State of California
and are admitted to practice before the United States District
Court for the Central District of California.

Irell has agreed to accept as compensation for its services
amounts as may be allowed by the Court, based on the time spent
and services rendered and other appropriate factors.  Irell has
further agreed to render services to the Committee at the Firm's
regular hourly rates, which may be subject to adjustment from
time to time.  The hourly rates to be charged to the Committee
are:

       William N. Lobel        Partner             $620
       Jeffrey M. Reisner      Partner              500
       Mike D. Neue            Associate            395
       Anna Mitescu            Associate            225
       Patricia Naegely        Legal Assistant      160

In connection with its employment by the Committee, Irell will:

    A. advise the Committee regarding its powers, rights and
       responsibilities under the Bankruptcy Code;

    B. represent the Committee in proceedings or hearings in the
       United States Bankruptcy Court for the Central District of
       California or any other forum as requested by the Committee
       in which an action or proceeding may affect the Debtors,
       its assets, claims of creditors or the Committee;

    C. advise and assist the Committee in connection with the
       administration of these cases, disposition of assets, and
       the confirmation and consummation of any proposed plan of
       reorganization or liquidation;

    D. advise the Committee concerning the requirements of the
       Bankruptcy Code and the federal and local rules relating to
       the administration of these cases;

    E. prepare pleadings, applications, schedules, orders and
       other papers as may be necessary or appropriate in
       connection with these Chapter 11 cases; and

    F. perform any other and further services as typically may be
       rendered by counsel for a committee of unsecured creditors
       in Chapter 11 cases or which may be necessary or advisable
       in connection with these cases, including the prosecution
       of avoidance and asset recovery actions.

Unless otherwise agreed between the parties, Irell will not be
responsible for:

     (i) the provision of substantive legal advice outside the
         insolvency area, including corporate law, partnership
         law, non-bankruptcy taxation, securities law, torts,
         environmental law, non-bankruptcy labor issues, criminal
         law, or real estate law; or

    (ii) substantive litigation involving prepetition claims.

Mr. Subin informs the Court that Irell received a $25,000
retainer on account of its prepetition representation of the
Unofficial Noteholders' Committee.  About $16,000 of the retainer
remains available to Irell for the payment of allowed postpetition
fees and expenses attributable to the representation of the
Committee.  There has been no other agreement or arrangement with
Irell and any other party regarding the payment of its fees and
expenses in these bankruptcy cases.

Irell Partner Jeffrey M. Reisner assures the Court that the Firm
and all of the attorneys are disinterested persons who do not
hold or represent any entity in the Debtors' cases having an
adverse interest in connection with the Debtors' cases, and do
not have any material connection either with the Debtors, their
creditors, the Committee, or any other party-in-interest in these
cases or with their attorneys or accountants, other than these
disclosures:

    A. Because of the specialized nature of bankruptcy practice,
       from time to time Irell may concurrently represent one
       client in a particular case and the adversary of that
       client in an unrelated case.  In addition, while
       representing the Committee, Irell may represent a debtor of
       the Debtors as a debtor in a bankruptcy case or in
       connection with out-of-court negotiations with the
       entity's creditors; provided, however, that in no event
       will Irell participate in these representations to the
       extent that they involve matters related to the Debtors.
       Finally, while representing the Committee, Irell may
       represent creditors of the Debtors in matters unrelated to
       these Chapter 11 cases.  With respect to the Committee
       members, the Committee recognizes Irell's right to
       represent these interests in matters unrelated to the
       Debtors' bankruptcy cases.  The Committee members also
       understand and have agreed that Irell does not, by virtue
       of its representation of the Committee in these cases,
       represent any of the members in these cases.

    B. Irell's members may have professional, working, or social
       relationships with firms or professionals that may be
       adverse to the Debtors or other interests in these cases.
       In addition, Irell's attorneys have spouses, significant
       others, parents, children, siblings, fianc,s or fianc,es
       who are attorneys at other law firms or companies that are
       or may be involved in the Debtors' cases.  Irell's policy
       strictly forbids disclosure of confidential information to
       anyone outside of the Firm.

    C. Prior to Irell's engagement by the Committee in these
       cases, the Firm performed services for these persons who
       are, or may be, parties-in-interest in these cases in
       matters that are wholly unrelated to the Committee and its
       members -- Alliance Capital Management; Alliance
       Partners, Inc.; Bear Sterns & Co., Inc.; Cargill; Merrill
       Lynch; Pierce Fenner & Smith, Inc.; Societe General;
       Andrews & Kurth LLP; Goldman, Sachs & Co.; Morgan Stanley;
       Northern Trust; Mellon Financial Services Corp.; Imperial
       Credit Asset Management; and Deutsche Bank Securities.
       Irell has not performed work for the majority of these
       former clients for several years.  Moreover, in most
       instances, since completing these representations, Irell
       has accepted employment adverse to these parties.  Irell
       will not perform services for any of these parties in any
       matter related to or arising out of these cases.  In the
       event that action is required in these bankruptcy cases by
       counsel against these parties, which is not anticipated,
       Irell will either obtain a waiver or other counsel will be
       asked to handle the matter.  Irell's personnel also are
       currently engaged as mediators in matters involving
       Allstate Funds and Bank One, N.A.

    D. From time to time, Irell has performed services for persons
       who are or may be parties-in-interest in these cases in
       matters wholly unrelated to the Committee.  Irell may
       continue to represent these parties in matters unrelated to
       the Debtors' bankruptcy cases, and may accept
       representations adverse to these parties -- U.S. Bancorp;
       Credit Suisse First Boston; JPMorgan Chase; and ABN Amro.
       In the event that a waiver is necessary and cannot be
       obtained, Irell will not represent the Committee with
       respect to the claims of these parties.

    E. Also, from time to time, Irell has referred work to, or has
       been referred work or retained by, various professionals
       who may be parties-in-interest or may be retained by
       parties-in-interest in these cases.  These professionals
       include -- Latham & Watkins; UBS Warburg; Kramer Levin
       Naftalis & Frankel LLP; Chanin & Co.; and Andrews & Kurth.
       Irell has not represented, and will not represent, any of
       these entities in connection with any matter related to
       these cases.

"Application approved," Judge Adler rules. (Leap Wireless
Bankruptcy News, Issue No. 7; Bankruptcy Creditors' Service, Inc.,
609/392-0900)


LEASE INVESTMENT: Fitch Cuts Four Class Note Ratings to BB/B
------------------------------------------------------------
Fitch Ratings has taken the following rating actions for Lease
Investment Flight Trust:

     --Class A-1 notes are downgraded to 'A' from 'AA';
     --Class A-2 notes are downgraded to 'A' from 'AA';
     --Class A-3 notes are downgraded to 'A' from 'AA';
     --Class B-1 notes are downgraded to 'BBB' from 'A';
     --Class B-2 notes are downgraded to 'BBB' from 'A';
     --Class C-1 notes are downgraded to 'BB' from 'BBB';
     --Class C-2 notes are downgraded to 'BB' from 'BBB';
     --Class D-1 notes are downgraded to 'B' from 'BB';
     --Class D-2 notes are downgraded to 'B' from 'BB';
     --All classes are removed from Rating Watch Negative.

The downgrades reflect the increasing gap between expected and
actual lease rental payments during 2003 as well as Fitch's
expectation that the current gap may narrow but will likely remain
in excess of those levels experienced previous to 2003.

The reduced cash flow lease rental trend is primarily attributable
to increased nonperforming aircraft and aircraft that have been
released at rates well below historical levels. The nonperforming
aircraft include 2 B767-300ER aircraft leased by Air Canada, who
is in bankruptcy and has not been making payments to most of its
aircraft lessors. While Fitch expects the resumption of the Air
Canada lease payments shortly, the new lease rates will likely be
below the original rates as the market for widebody aircraft has
deteriorated during the past two years.

LIFT's lease expirations during 2004 are not overwhelming and
include only 3 aircraft, 2 B737-300s and 1 B737-400. The continued
depressed demand for many aircraft types will likely continue to
impair lease rates. Additional market events such as terrorist
attacks, airline bankruptcies and or airline liquidations are
possible and would exacerbate weak lease rates.

LIFT is a Delaware business trust formed to conduct limited
activities, including the issuance of debt, and the buying,
owning, leasing and selling of commercial jet aircraft. LIFT
originally issued $1,429 million of notes in June 2001, while as
of July 2003 had $1,337 million of notes outstanding. Primary
servicing is being performed by GE Capital Aviation Services,
Limited (a wholly owned subsidiary of General Electric Capital
Corp.), while the administrative agent role is being performed by
Phoenix American Financial Services, Inc., a subsidiary of Phoenix
American Incorporated.


LENNOX INT'L: Second Quarter 2003 Results Reflect Improvement
-------------------------------------------------------------
Lennox International Inc. (NYSE: LII) (S&P/BB- Corporate Credit
Rating) announced second quarter 2003 diluted earnings per share
of $0.51 versus $0.43 for the same quarter in 2002.

Sales decreased 1% to $819 million from $828 million in last
year's second quarter. In constant currencies and adjusting for
the loss of $49 million in heat transfer revenues -- most of which
are now part of the company's joint venture with Outokumpu and no
longer reported by LII -- total sales were up 2%. Sales outside
the U.S. and Canada generated 13% of total LII revenues.

Quarterly operating income was $56 million, up 10% from last
year's $51 million. The second quarter 2002 included $1 million in
pre-tax restructuring charges related to programs announced in
2001, while a pre-tax charge of $0.1 million for gains, losses and
other expenses was recorded in the second quarter 2003. Adjusting
for these items, operating income increased 7% year-over-year, the
company's sixth straight quarter of year- over-year improvement in
operating profitability.

Net income was $30 million, up 19% from $26 million in the same
period last year. Diluted earnings per share were $0.51 compared
with $0.43 in second quarter 2002. When adjusted for gains, losses
and other expenses, and restructuring charges, net income grew
12%. On the same basis EPS increased to $0.50 in second quarter
2003, versus $0.45 the prior year.

As of June 30, 2003, LII's total debt was $390 million, down $121
million from a year ago. Total debt to capitalization was 42.2%,
comparing very favorably with 53.2% a year ago. Free cash flow in
the second quarter was a usage of $21 million, bringing the year-
to-date figure to a usage of $73 million. Due to the seasonal
nature of many of the company's businesses, it is typical for LII
to use free cash flow in the first half of the year and generate
free cash flow in the second half. Operational working capital
ratio improved significantly to 19.2% from 21.1% last year. At the
end of second quarter, inventories were down 10%, or $29 million,
from 2002.

"I'm very pleased to report our sixth straight quarter of year-
over-year improvement in operating performance, despite difficult
market conditions," said Bob Schjerven, chief executive officer.
"And our progress was not limited to the profitability reported on
our income statement and the strengthening of our balance sheet.
We continue to execute the initiatives necessary to position
Lennox International for profitable growth."

Business segment highlights:

Heating & Cooling: LII's Heating & Cooling business revenues rose
10% to $509 million, despite reduced industry shipments and
unfavorable weather in many key markets. Adjusting for
fluctuations in exchange rates, sales were up 7%. Segment
operating income increased 32% to $55 million from $42 million
last year and operating margins expanded 180 basis points to 10.8%
from 9.0% last year.

Residential heating & cooling revenues grew 8% in the second
quarter to $377 million, with sales up 7% adjusting for foreign
exchange. Sales increases were achieved by all of the company's
home comfort equipment brands, including hearth products. Segment
operating income increased 27% for the quarter to $46 million from
$36 million last year. Operating margins expanded 180 basis points
to 12.2% through higher volumes; a favorable mix of recently
introduced, higher margin premium product; and improved hearth
products performance. This improvement continued to be partially
offset by margin pressure in LII's residential new construction
business.

Commercial heating & cooling revenues rose 15% to $132 million, up
8% when adjusted for currency fluctuations. Segment operating
profit jumped 59% to $9 million, with operating margins increasing
to 6.9% from 5.0% last year. Higher volumes, increased factory
productivity, and the benefits of paring back underperforming
international operations more than offset expenses associated with
closing a plant in Europe. Production at that plant ceased at the
end of the second quarter, with volume relocated to other LII
facilities.

Service Experts: Revenues declined 3% to $243 million, or 5%
adjusting for currency exchange. As with the first quarter 2003,
the sales decline was attributable entirely to the company's
commercial new construction business. Year-over-year sales in the
service and replacement businesses and in the residential new
construction business grew modestly for the second straight
quarter. Lower margins in the new construction businesses, higher
insurance expenses, and increased investment in advertising
reduced segment operating profit to $8 million from $16 million
last year. Operating margins for the quarter were 3.1%, compared
with 6.3% last year.

"While the market environment for Service Experts is extremely
challenging -- especially given soft end market demand for
replacement sales and stiff price competition in the new
construction sector -- we continue to implement key initiatives to
improve profitability," Schjerven said. "We continue to see the
profit and growth potential of this business, and we're confident
the actions we have underway, including the new management
announced two weeks ago, are beginning to pay off in improved
performance."

Refrigeration: Demand for commercial refrigeration products from
retail customers, notably supermarkets, was depressed in both
domestic and international markets. In this difficult environment,
segment revenues were up 5% at $97 million, down 3% when adjusted
for currency exchange. Segment operating income was flat at $9
million, with operating margins declining 50 basis points to 9.2%.
Improved factory performance and diligent cost control partially
offset the impact of lower foreign exchange-adjusted revenues.

                         Business outlook

With no clear evidence of a sustained commercial market recovery
in the back half of the year, and assuming normalized weather
patterns, the company continues to expect revenues to be
relatively flat for full-year 2003.

"We're very pleased with the operating improvements we realized in
the first half of this year in our heating & cooling and
refrigeration businesses, and we're confident this trend will
continue," said Bob Schjerven. "Combining that success with our
anticipation of a modest improvement in Service Experts
profitability in the last half of the year, we are very confident
in reaffirming our guidance for full-year 2003 EPS in the range of
$1.10 to $1.20." The company continues to expect free cash flow
will be approximately equal to net income for the full year.

A Fortune 500 company operating in over 100 countries, Lennox
International Inc. is a global leader in the heating, ventilation,
air conditioning, and refrigeration markets. Lennox International
stock is traded on the New York Stock Exchange under the symbol
"LII". Additional information is available at:
http://www.lennoxinternational.com


LTV CORP: Wants to Fund Trust to Indemnify Officers & Directors
---------------------------------------------------------------
The LTV Corporation, LTV Steel Corporation, and each of their
wholly owned debtor subsidiaries -- but excluding LTV Steel's non-
debtor railroad subsidiaries and Copperweld, Welded Tube Holdings,
Inc., and their business-affiliated entities -- ask Judge Bodoh to
authorize the creation and funding of a trust to ensure the
continued indemnification of their current and future directors
and officers during the winddown of their estates.

Nicholas M. Miller, Esq., at Jones Day, in Cleveland, Ohio,
reminds Judge Bodoh that, by orders entered on December 7, 2001
and August 30, 2002, the Court authorized the Debtors to implement
an asset protection plan through and including December 13, 2002
to effect the orderly cessation of operations for, and the sale of
assets of, the Debtors' Integrated Steel Business.  By an order
dated February 28, 2002, the Court approved the sale of
substantially all of the assets of the Integrated Steel Business
to WLR Acquisition Co., now known as International Steel Group,
Inc.  The closing of the Integrated Steel Sale transactions
occurred on April 12, 2002 for the hard assets, and May 13, 2002
for the inventory.  On November 7, 2002, the Court entered an
order approving the sale of the assets of the LTV Tubular division
of LTV Steel.  The closing of the sale of the LTV Tubular Business
occurred on December 31, 2002.

      The Indemnification Obligations and the Proposed Trust

The articles of incorporation and/or by-laws of the LTV Debtors
provide for indemnification of the applicable corporation's
directors and officers to the full extent permitted under the laws
of their states of incorporation by reason of the fact that such
person is or was an officer or director or is or was serving at
the company's request as an officer or director in any other
corporation, partnership, joint venture, trust or other
enterprise, including any of the Debtors. However, LTV Steel, and
possibly other of the LTV Debtors, are administratively insolvent.
Further, all of the LTV Debtors' assets eventually will be
distributed to creditors, potentially leaving insufficient or no
funds available to satisfy the Indemnity Obligations.  As of June
28, 2003, the prior director, officer and fiduciary liability
insurance policies maintained by the LTV Debtors expired, and the
LTV Debtors obtained new policies with substantially reduced
limits and a $1,000,000 self-insured retention.

The creation of the Trust is intended to ensure the fulfillment of
the LTV Debtors' Indemnity Obligations to their current -- i.e.,
those who served at any time on or after June 28, 2003 -- and
future directors and officers.

                          The Trust

The Trust will be an irrevocable, non-ERISA, grantor trust
established with an independent bank or trust company having a
capital and surplus of at least $500,000,000 in the aggregate.
The principal and interest earned on that sum will be held in
trust separately from other funds of LTV Steel and used
exclusively for the purposes of indemnification. The Trust's
assets will be invested in interest-bearing deposit accounts or
short-term United States obligations or mutual funds that invest
primarily in such obligations.  No Indemnitee will have any
beneficial ownership in the Trust's assets prior to the time they
are paid to an Indemnitee as provided under the terms of the Trust
and the articles or bylaws.  The Trustee will make disbursements
from the trust assets to pay unpaid Indemnity Obligations on a
current basis as an Indemnitee incurs them on the completion of
these procedures:

      *  An Indemnitee will give 10 business days' written
         notice, which Notice will include:

             (a) a reasonably detailed description of the
                 unpaid Indemnity Obligation, including
                 reasonable time and narrative detail for any
                 legal fees included in such unpaid Indemnity
                 Obligation, and

             (b) a statement that:

                  (i) the Indemnitee has sought reimbursement
                      for the Indemnity Obligation under any
                      applicable D&O insurance policies and
                      from LTV Steel, and

                 (ii) the insurers and LTV Steel have failed
                      or refused to reimburse the Indemnitee
                      on a current basis.

                 The Notice will be transmitted to the Trustee
                 of the Trust, LTV Steel, LTV Steel's legal
                 counsel, the Administrative Claimants'
                 Committee's legal counsel and any Indemnitee
                 who files a request with the Bankruptcy Court
                 to receive such notice.

             (c) Any of the Notice Parties may dispute the
                 validity of the Indemnity Obligation for which
                 reimbursement is sought in a Notice by:

                  (i) filing an Objection with the Bankruptcy
                      Court prior to the end of the Notice
                      Period, and

                 (ii) serving the Objection on the Notice
                      Parties and the Indemnitee that submitted
                      the Notice prior to the end of the Notice
                      Period.

                 An Objection must state with particularity the
                 nature of the party's objection to the validity
                 of the Indemnity Obligation sought in a Notice.
                 At the end of the Notice Period, unless an
                 Objection has been appropriately filed and
                 served, the Trust will disburse to the
                 Indemnitee, or to the person or entity to whom
                 the Indemnitee owes funds that give rise to an
                 Indemnity Obligation, in the discretion of the
                 Trustee, from the Trust assets an amount equal
                 to the amount of the Indemnity Obligation
                 described in the Notice.  If an Objection is
                 properly filed and served, however, the Trustee
                 will make disbursement from the Trust assets
                 for Indemnity Obligations only in accordance
                 with the terms of a final, non-appealable order
                 of the Bankruptcy Court.

The principal terms of the Trust are:

      (a) Trust Amount: LTV Steel will fund the Trust with an
          initial $1,000,000 contribution.  If Trust Assets are
          distributed pursuant to the terms of the Trust, then
          LTV Steel will contribute additional funds to the
          Trust so that the Trust Assets will remain at
          $1,000,000 until the expiration of the Trust.

      (b) The current and future directors and officers of
          these subsidiaries are not Indemnitees:

             Copperweld Bimetallic Products Company
             Copperweld Canada Inc.
             Copperweld Corporation
             Copperweld Equipment Company
             Copperweld Marketing & Sales Company
             Copperweld Tubing Products Company
             LTV Copperweld Bimetallics UK (Holdings) Limited
             LTV Copperweld Bimetallics UK Limited
             LTV International, Inc.
             Metallon Materials Acquisition Corporation
             Miami Acquisition Corporation
             Southern Cross Investment Company
             TAC Acquisition Corporation
             Welded Tube Co. of America
             Welded Tube Holdings, Inc.
             Aliquippa and Southern Railroad Company
             Chicago Short Line Railway Company
             The Cuyahoga Valley Railway Company
             Monongahela Connecting Railroad Company, and
             The River Terminal Railway Company.

      (c) Past directors and officers who are not serving in
          such capacity as of June 28, 2003 are not
          Indemnitees.

      (d) Trust Purpose: The Trust Assets will be used to
          indemnify the Indemnitees regardless of when a
          claimed loss is or was incurred or asserted, to the
          extent that such claim or loss is not fully covered
          or paid by the applicable director, officer and/or
          fiduciary liability insurance policy and not
          otherwise fully paid by the applicable LTV Debtor.

      (e) Beneficiaries: The rights of each Indemnitee against
          the LTV Debtors or under any applicable insurance
          policies and applicable law will in no way be
          affected or diminished by the establishment or any
          provision of the Trust.

      (f) Trust Termination: On the date of the expiration of
          the last run-off endorsement under any applicable D&O
          Policy, all Trust Assets, including accrued interest,
          remaining in the Trust will be released to LTV Steel
          unless one or more claims to which an Indemnity
          Obligation may apply are then pending against an
          Indemnitee, in which event the release of Trust
          Assets will occur upon the final disposition of
          such claim(s).

           Creation & Funding of the Trust is Warranted

Section 363(b) of the Bankruptcy Code provides that a debtor-in-
possession "after notice and a hearing, may use, sell, or lease,
other than in the ordinary course of business, property of the
estate."  In general, a debtor may use, sell, or lease property of
the estate outside the ordinary course of its business where such
use represents an exercise of the debtor's sound business
judgment.  The "use" of a debtor's funds to pay for expenses
related to the operation of its business is considered a use that
is governed by Section 363 of the Bankruptcy Code.

The LTV Debtors believe that creation of the Trust is warranted
because their efforts to wind down and otherwise resolve their
estates require the continued cooperation and expertise of the
Indemnitees.  Without assurance that the LTV Debtors will be in a
position to honor their Indemnification Obligations, the
Indemnitees may terminate their relationships with the LTV Debtors
to avoid the resulting risk of personal exposure for otherwise
indemnifiable losses.  The Administrative Claimants' Committee has
indicated its support for the creation of the Trust. (LTV
Bankruptcy News, Issue No. 51; Bankruptcy Creditors' Service,
Inc., 609/392-00900)


LTWC CORPORATION: Case Summary & Largest Unsecured Creditors
------------------------------------------------------------
Lead Debtor: LTWC Corporation
             111 High Ridge Road
             Stamford, Connecticut 06905
             dba Learn2 Corporation
             dba Learn2.com
             dba E-Stamp Corporation

Bankruptcy Case No.: 03-12272

Debtor affiliates filing separate chapter 11 petitions:

        Entity                                     Case No.
        ------                                     --------
        LTWC CA Corporation                        03-12273
        LTWC DE Corporation                        03-12274
        LTWC Services, Inc.                        03-12275
        Viagrafix Corporation                      03-12276

Type of Business: The Debtor provides permission email marketing
                  and tracking services.

Chapter 11 Petition Date: July 23, 2003

Court: District of Delaware

Judge: Peter J. Walsh

Debtors' Counsel: John C. Phillips, Jr, Esq.
                  Phillips, Goldman & Spence
                  1200 N. Broom Street
                  Wilmington, DE 19806
                  Tel: 302-655-4200
                  Fax : 302-655-4210

Total Assets: $5,016,000 (as of March 31, 2003)

Total Debts: $2,576,000 (as of March 31, 2003)

A. LTWC Corporation's 20 Largest Unsecured Creditors:

Entity                      Nature Of Claim       Claim Amount
------                      ---------------       ------------
Credit First Suisse Boston  Investment Banking Fees   $465,857
650 California Street
San Francisco, CA 94108
Ethan M. Topper
Tel: 415-249-2100

Bowne Financial Printers    Financial Printing Fees   $336,254
633 West 5th Street,
Suite 1400
Los Angeles, CA 90071
Tel: 213-627-2200

Richardson ISD              Property Taxes             $69,856

AT&T Teleconference         Teleconference Services    $56,448
Services

Kewill Electronic Commerce  Construction Services      $39,336

Merrill Comms, LLC          Edgar Filings              $38,832

AT&T                        Telephone                  $38,278

Wilson Sonsini Goodrich     Legal Services             $33,037
& Fosati

Pacific Bell                Telephone                  $28,478

Perkins Cole, LLP           Legal Services             $25,898

County of Santa Clara Tax   Property Taxes             $23,698
Collectors Office

Bridgeport Financial, Inc.  Marketing Expenses         $23,500

Jackson Lewis Schnitz &     Legal Services             $20,965
Krup

NASDAQ Stock Market, Inc.   Listing Fees               $20,667

Jefferson County Colorado   Property Taxes             $11,296

Merrill Lynch               Administrative Fees         $9,300

Blevins & Sordahl, Inc.     Legal                       $8,615

World View Technologies     Consulting                  $7,970

Time Warner Telecom         ISP Fees                    $7,803

The Washington Mgt. Group                               $7,294

B. LTWC Services, Inc.'s 20 Largest Unsecured Creditors:

Entity                      Nature Of Claim       Claim Amount
------                      ---------------       ------------
Perkins Cole, LLP           Legal                     $195,900

A.I. credit Corp.           E&O Insurance              $35,900

Internap Network Services   Bandwith                   $32,736

New Edge Networks           Bandwith                   $31,200

XO Communications           Bandwith                   $30,519

Stansbury Jobs              Temp Help                  $14,605

Regan Braun Law Office      Legal                      $13,621

Accountants, Inc.           Temp Help                   $6,289

Qwest                       Bandwith                    $4,684

Insight                     Equipment                   $4,392

AT&T Corp.                  Bandwith                    $4,052

G Finance Holding Corp.     Lease                       $3,564

Citicorp Vendor Finance     Lease                       $3,055

Robert Half                 Temp Help                   $2,790

Telstra, Inc.               Telephone                   $2,449

Gross & Belsky, LLP         Legal                       $2,344

Nicole Rynee Barnes         Legal                       $2,062

Pacific Gas & Electric      Utility                     $2,876

Stormwatch Services, Inc.   Equipment                   $2,150

Fusionstorm                 Equipment                   $1,618

C. Viagrafix Corporation's 20 Largest Unsecured Creditors:

Entity                      Nature Of Claim       Claim Amount
------                      ---------------       ------------
Lightyear Communications    Telephone                  $27,354

United Parcel Service       Freight Expense            $21,696

Southwestern Bell           Bandwith                   $18,475

Southwestern Bell           Bandwith                   $17,484

Creative Computers          Computers                  $13,002

Southwestern Bell           Telephone                  $12,876

Programmer's Paradise, Inc. Advertising                $12,212

Echodata Services, Inc.     Inventory                  $11,458

Advanced Digital            Inventory                  $11,295
Information

CMP Media, Inc.             Advertising                 $8,550

Southwestern Bell           Telephone                   $8,531

Allied Vaughn               Inventory                   $8,491

Hamilton Exhibits           Trade Show                  $6,975

Prodata Internet Service,   Consulting                  $6,826
Inc.

Southwestern Bell           Telephone                   $6,286

Consumer Products Council   Advertising                 $6,000

Crain Displays & Exhibits,  Advertising                 $5,526
Inc.

Blevins & Sordal, Inc.      Legal                       $4,722

America Online, Inc.        Advertising                 $4,660

RJM Sales                   Marketing                   $4,560


LUCILLE FARMS: Fails to Comply with Nasdaq Listing Requirements
---------------------------------------------------------------
Lucille Farms, Inc. (NASDAQ: LUCY) received a Nasdaq Staff
Determination, dated July 17, 2003 which indicated that the
Company had failed to file its Annual Report on Form 10-K as
required by Marketplace Rule 4310(C)(14), and that its securities
were, therefore, subject to delisting from the Nasdaq SmallCap
Market. The Company has requested a hearing before a Nasdaq
Listing Qualifications Panel to review the Staff Determination.
There can be no assurance that the Panel will grant the Company's
request for continued listing.

On July 16, 2003, the Company issued a press release containing
its results for the quarter and fiscal year ended March 31, 2003
and reported that there will be a delay in the filing of its
Annual Report on Form 10-K due to the failure to obtain on a
timely basis a waiver of a default in the debt service ratio
covenant contained in its USDA guaranteed 20-year term loan with
First International Bank (UPS Capital Business Credit).

In such release Jay Rosengarten, the Company's CEO stated: "The
failure to obtain the waiver prior to filing the Annual Report on
Form 10-K would require the Company to report the loan as a
current liability as at its fiscal year ended March 31, 2003. This
in turn would result in a default in other covenants contained in
the loan agreement with the Bank, as well as a default in
covenants contained in loan agreements with other banks. Monthly
payments of the obligation to the Bank have been made on a timely
basis. The Company has been advised by the Bank that the delay in
obtaining the waiver stems from the need to obtain approval for
the waiver from the USDA and the paperwork involved in the
process. We have no reason to believe that the waiver will not be
forthcoming."

Lucille Farms, Inc. is engaged in the manufacture, processing,
shredding and marketing of low moisture mozzarella cheese and the
shredding of other cheese and cheese blends. Also, utilizing
proprietary formulas and processes, the Company has developed a
line of mozzarella type cheese products, which include reduced
fat, non-fat and low moisture products. The company also sells
whey, which is a by-product of its cheese making operation. The
Company's low moisture mozzarella and mozzarella type cheese
products are manufactured in the Company's USDA approved
production facility in Swanton, Vermont and are made of natural
ingredients.


MANDALAY RESORT: Fitch Rates $250M 6. Senior Unsec. Notes at BB+
----------------------------------------------------------------
Fitch Ratings has assigned a rating of 'BB+' to the $250 million
senior notes due 2009 being issued by Mandalay Resort Group.
Proceeds are to be used to pay down outstandings under the
revolving credit facility. Ratings reflect Mandalay's leading Las
Vegas assets, strong historical operating performance, significant
discretionary free cash flow, and growth potential for 'Mandalay
Mile' Strip properties (principally Mandalay Bay) driven by the
new $235 million convention center which opened in January 2003
and the $225 million hotel tower at Mandalay Bay which should open
in November 2003. Beyond 2004, MBG has no major capital projects
in the pipeline and should have the capacity to delever. These
factors are partially offset by the company's aggressive financial
policy (which entails a demonstrated proclivity for share
repurchases and more recently, dividends), heavy capital
expenditure plans in FY 2004, gaming tax increases in Illinois and
Nevada, the competitive threat of Native American Gaming in
California to MBG's secondary Strip and other Nevada properties,
and declining EBITDA contributions from major secondary markets,
Detroit and Illinois. In FY 2004, EBITDA Fitch believes leverage
will continue to deteriorate to levels weak for the category as
debt levels rise and company-wide EBITDA retracts. The Rating
Outlook is Stable.

As of April 30, 2003, MBG had $2.87 billion in debt, comprised of
senior unsecured bank debt (25%), senior unsecured notes (25%),
and subordinated notes (50%). Over the course of FY 2004, MBG will
refinance $575 million in debt, including: (1) $150 million in
6.75% senior subordinated notes which matured in July 2003; (2)
$275 million in senior notes due December 2005 which were called
and redeemed on July 15, 2003; and (3) $150 million in 6.7%
debentures due 2096, which will likely be put to MBG in November
2003. Issuance of the new notes plus $400 million floating-rate
convertible senior debentures issued back in March 2003 and bank
borrowings will largely address these requirements. In addition,
MBG is currently negotiating a new $150 million capital lease
facility that will substantially replace the outstanding operating
lease agreements totaling $158 million, including a $113 million
operating lease agreement which terminates June 30, 2003. With
retirement of the operating leases, rent expense will no longer
flow through the EBITDA, and MBG can use 'EBITDA' versus 'EBITDAR'
for reporting purposes. Refinancing actions in fiscal 2004 will
increase the overhang of senior debt, as subordinated debt
composition will decline to roughly 40% of total debt versus
roughly 50% at FYE 2003. However, these actions also allow MBG to
take advantage of historically low interest rates, and should
improve operating leverage.

For FY 2004, Fitch expects MBG's operating performance to look
much like that of the first quarter, in which EBITDA
outperformance by MBG's flagship property, Mandalay Bay (23% of FY
2003 EBITDAR), was offset by declines at the rest of the
properties, resulting in a 8.0% decline in property EBITDAR. As in
the first quarter, Mandalay Bay should continue to benefit from
the addition of its new $235 million convention center (opened
January 6, 2003) which drove a sharp increase in RevPAR and fueled
a 16% increase in EBITDAR at the property. With the largest room
base on the Las Vegas Strip, MBG is particularly leveraged to room
rates. Through RevPAR gains, Fitch believes the convention center
will continue to generate significant EBITDA gains at Mandalay Bay
through FY 2004. In addition, the convention center should be a
major source of room demand for the new all-suite room tower at
Mandalay Bay, which is scheduled to open in fall 2003. Tax
increases recently announced in Illinois and Nevada are negatives
for MBG; however, the credit impact should not be material. Fitch
estimates that the two plans will result in a $24 million hit to
EBITDA in FY 2004 versus the prior year, or approximately a 0.2x
turn in leverage.

Free cash flow should be in the $250 million - $275 million range
in FY 2004, short of project capital spending requirements of $350
million. Project capital spending requirements primarily relate to
the new all-suites tower and new retail center at Mandalay Bay,
which are scheduled to open in November 2003. Thereafter, roughly
$27.5 million in dividend payments, termination of the $100
million equity forward contract, and replacement of the $158
million operating lease facility with an on-balance sheet capital
lease facility, should cause debt levels to increase by
approximately $300 million to the $3.0 billion range by year-end.
Based on this forecast, Fitch expects MBG's leverage to continue
to increase to above the 5.0 times range by year-end. This follows
a 0.5x increase to 4.9x in FY 2003, when weaker operating results,
heavy capital spending and aggressive share repurchases also
precluded material debt reduction.

Financial flexibility is hampered in FY 2004 as cash from
operations is spoken for and the company operates close to its
covenant restrictions. However, issuance of the new notes reduces
MBG's reliance on the revolver which otherwise would have been
largely tapped in FY 2004. While the company secured amendments in
Feb. 2003 to loosen the leverage covenant to 5.25x through FYE
2004, Fitch believes weakness in the latter half would necessitate
further amendments or waivers from lenders. Fitch believes there
is little risk that bank lenders will not grant the necessary
waivers or amendments if required.

In FY 2005, committed investments should drop significantly. With
no major capital projects officially in the pipeline, MBG should
have the capacity to reduce debt and leverage to the more
acceptable levels for the rating category. Nonetheless, the
company could announce capital spending plans at any time that
could usurp free cash flow and decelerate or eliminate potential
deleveraging. Notably, the funding for the permanent casino in
Detroit is expected to be off-balance sheet, and should therefore
not impact MBG's leverage.


MILLENNIUM CHEM: S&P Further Cuts Ratings on Weak Fin'l Profile
---------------------------------------------------------------
Standard & Poor's Ratings Services lowered its corporate credit
rating on Millennium Chemicals Inc. to 'BB' from 'BB+' citing the
company's subpar financial profile and the announcement that
Millennium expects to report a steeper than expected loss for the
second quarter due to weak sales volumes and competitive price
pressures in the titanium dioxide (TiO2) business. The current
outlook is negative.

Red Bank, New Jersey-based Millennium, with about $1.6 billion of
annual sales and approximately $1.2 billion of outstanding debt
(excluding adjustments to capitalize operating leases), is
primarily engaged in the production of commodity chemicals.

"The announced operating shortfall, which comes during the
important coatings season for TiO2, as well as lingering economic
uncertainties and the potential for additional raw material
pressures in the petrochemical industry, are likely to further
delay Millennium's efforts to restore the financial profile," said
Standard & Poor's credit analyst Kyle Loughlin. "Standard & Poor's
also recognizes that adverse business conditions in the
petrochemical industry, including recent escalation in natural gas
costs and weak demand for plastics, are likely to limit cash
distributions from 29.5%-owned Equistar Chemicals L.P. this year."

Standard & Poor's said that its ratings on Millennium reflect its
average business risk profile and aggressive debt burden,
mitigated somewhat by financial policies that strongly emphasize
debt reduction as business conditions improve. Still, a
disappointing coatings season for TiO2--a white pigment used in
coatings, plastics, and paper production--and heightened
uncertainty with respect to natural gas prices on the company's
acetyls segment are likely to result in a more gradual trend of
improvement than previously planned. Still, meaningful sources of
untapped liquidity, in the form of bank facilities, cash balances,
and the ownership stake in Equistar Chemicals, remain positive
factors, although cash distributions are likely to be of limited
benefit in the near term.


MIRANT CORP.: Committee Formation Meeting is Tomorrow in Dallas
---------------------------------------------------------------
George F. McElreath, the Assistant United States Trustee for
Region 6, will meet with Mirant's largest creditors in Dallas
tomorrow for the purpose of forming one or more official
committees.  The meeting will be held at 10:00 a.m. in the
Lakewood Room at Cityplace Conference Center, located at
2711 N. Haskell in Dallas, Texas.

Yesterday's story about an official committee in Mirant's chapter
11 proceeding hiring a law firm was erroneous.  That story related
to Leap Wireless rather than Mirant.  We apologize for the
confusion.


MIRANT CORP: Court Restricts Securities Trading to Preserve NOLs
----------------------------------------------------------------
Mirant announced that the U.S. Bankruptcy Court has entered an
emergency relief order preventing the sale or trading of certain
shares of, and claims of creditors in, the company's Chapter 11
case.

Creditors holding claims against Mirant or its debtor subsidiaries
in excess of $250 million, and shareholders owning or seeking to
acquire 4.75 percent of Mirant's stock, are prohibited from
selling or trading such shares or claims. This order is in effect
until the Court can consider Mirant's request to establish a
notice procedure regarding the trading of shares and claims.

The emergency relief is necessary to prevent potential trades of
claims or stock that could negatively impact the Debtors' net
operating loss tax attributes. The emergency relief preserves
these tax attributes until parties in interest can appear and be
heard regarding the notice procedure requested by Mirant.

Mirant's tax loss attributes are approximately $1 billion and
could reach $2.5 billion by the end of 2003. These attributes may
result in potential future tax savings of as much as $200 to $400
million.

The court order, the motion filed by the Debtors, and the
supporting notices and papers are available at
http://www.bsillc.com In addition, copies may be obtained by
contacting Craig H. Averch at (310) 620-7704 or
caverch@whitecase.com.

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 22,000 megawatts of electric
generating capacity globally. We operate an integrated asset
management and energy marketing organization from our headquarters
in Atlanta. For more information, visit http://www.mirant.com


MIRANT CORP: Asks Court to Deem Utilities Adequately Assured
------------------------------------------------------------
Pursuant to Sections 105(a) and 366 of the Bankruptcy Code, Mirant
Corp., and its debtor-affiliates seek a Court order:

    -- prohibiting the Utility Companies from altering, refusing
       or discontinuing services, including the making of demands
       for security deposits or accelerated payment terms;

    -- determining that the Utility Companies have been provided
       with "adequate assurance of payment" within the meaning of
       Section 366; and

    -- establishing procedures for determining requests for
       additional assurance of payment, providing that each
       Utility Company may petition this Court for relief
       consistent with Section 366.

The Debtors obtain a wide range of utility services from different
utility companies, including electricity, telephone, gas, oil,
coal, pipeline, rail and transmission services.  Judith Elkin,
Esq., at Haynes and Boone LLP, in Dallas, Texas, confirms that the
Debtors have paid all amounts owed to the Utility Companies in
full and on time.  Furthermore, the Debtors are current with
respect to their undisputed utility invoices, other than payment
interruptions that may be caused by the commencement of these
Chapter 11 cases.  Indeed, prior to the Petition Date, the average
monthly cost of Utility Services was approximately $10,600,000 in
the aggregate.

Ms. Elkin assures the Court that the Debtors currently have over
$733,000,000 in available cash and anticipate receiving approval
of a $500,000,000 DIP financing facility.

The Debtors have determined that these service providers should
be considered utilities:

A. Certain of the Fuel Suppliers are "Utilities"

    The nature of the Debtors' generating business is such that
    certain of its commercial suppliers and contractors have
    attained "utility" status insofar as Section 366 is concerned.

    Among the Debtors' Utility Companies is Massey Coal Sales
    Company, Inc., a commercial provider of coal necessary to fuel
    the production of electricity at the Debtors' Lovett, New York
    generation facility.  The Debtors use coal in the same way
    that they use gas -- as fuel for the production of
    electricity.  The continued supply of this fuel is vital to
    the Lovett generation facility's operations.

    Because Massey provides essential coal to the Lovett
    generation facility and this service cannot easily be
    replaced, this supplier is a "utility" governed by Section 366
    and should be enjoined from attempting to "alter, refuse or
    discontinue" service to the Debtors.

B. The Pipeline, Rail and Transmission Grid Operators are
    Utilities

    Section 366 not only covers suppliers of utility services, but
    also entities that function as conduits for those services.
    CSX Transportation, Inc. and Norfolk Southern Railway Co., the
    rail companies that transport coal to the Lovett generation
    facility cannot be bypassed.  Despite extensive efforts, the
    Debtors have been unable to arrange for alternate providers
    for this service.  If these rail operators are allowed to
    terminate service to the Debtors, the Lovett generation
    facility will be unable to obtain coal.

"It is essential that the Utility Services continue
uninterrupted," Ms. Elkin says.  If the Utility Companies are
permitted to terminate Utility Services, the Debtors' operations,
including its generating plants, will be impaired and may be
forced to shut down.  The latter event would have devastating
consequences for the Debtors' operations, jeopardizing the
Debtors' ability to reorganize and exposing their employees to
the risk of being laid-off.

Moreover, due to the particular nature of the Debtors' business
-- supplying energy services nationwide -- a disruption in service
could present health and safety hazards to the Debtors' customers
and the public at large.  Quite simply, a cessation in Utility
Services could leave millions of homeowners and business without
power.

Ms. Elkin relates that that the Utility Companies are adequately
assured of payment given that:

    (a) the Debtors have historically paid amounts owing to the
        Utility Companies in respect of the contracts and tariffs
        at issue in full and on time;

    (b) for gas, oil and coal contracts, the Debtors intend to
        prepay for these commodities;

    (c) the Debtors possess in excess of $733,000,000 cash and
        anticipate receiving approval of a $250,000,000 DIP
        financing facility;

    (d) the Debtors project generating sufficient cash
        postpetition to meet all working capital needs or
        otherwise obtaining sufficient DIP financing;

    (e) postpetition utility charges will have administrative
        expense priority pursuant to Sections 503(b)(1)(A) and
        507(a)(1) of the Bankruptcy Code; and

    (f) in the event of a postpetition default or other changes in
        circumstances, any utility may petition the Court for
        relief consistent with Section 366.

The adequate assurance determination must be made on a case-by-
case basis examining the facts and circumstances of each case.
In Mirant's case, the Debtors have an excellent history of
promptly paying all of their utility obligations.  Prepayment for
the delivery of gas, oil and coal will completely eliminate the
risks to the counterparties to these transactions.

Moreover, a debtor's financial resources are an important factor
in determining adequate assurance.  Because the Debtors have more
than sufficient liquidity to meet all postpetition utility
obligations, the risk of non-payment is diminished.  Furthermore,
the granting of administrative expense priority to a utility
provider, where a debtor has a good payment history and a high
degree of liquidity, satisfies the requirements of adequate
assurance, obviating the need for the debtor to post a security
deposit.

Accordingly, the Debtors ask the Court to approve their proposed
adequate assurance to each Utility Company and the procedure
concerning requests for additional assurance.

Ms. Elkin states that this request is without prejudice to the
Utility Companies' rights to ask additional assurances in the
form of deposits or other security; provided, however, that any
request must be made in writing and actually received by the
Debtors and counsel for the Debtors within 45 days of the Order
date entered in accordance with this request -- the Deposit
Request Deadline.  Any request the Debtors will receive for
additional assurances after the Deposit Request Deadline will
constitute an untimely and invalid adequate assurance request.

If a Utility Company disputes the finding of adequate assurance,
the Utility Company will be required to file a motion for
determination of adequate assurance of payment unless otherwise
agreed to by the parties or ordered by the Court. (Mirant
Bankruptcy News, Issue No. 2; Bankruptcy Creditors' Service, Inc.,
609/392-0900)


NATIONAL EQUIPMENT: Kurzman Carson Appointed as Claims Agent
------------------------------------------------------------
National Equipment Services, Inc., and its debtor-affiliates asks
for permission from the U.S. Bankruptcy Court for the Northern
District of Illinois to appoint Kurtzman Carson Consulting LLC as
Notice, Claims and Balloting Agent.

KCC and the Debtors agreed that in this retention, KCC will
provide:

     a) assistance to the Debtors with preparation the Schedules
        of Assets and Liabilities, Statement of Financial
        Affairs and other documents required for filing with the
        Court;

     b) claims administration;

     c) assistance with solicitation of acceptances or
        rejections to any plan of reorganization filed by the
        Debtors; and

     d) performance of other miscellaneous administrative
        services.

KCC will also provide the Debtors with claims management
consulting and computer services. The Debtors also may use KCC to
provide the Debtors with training and consulting support necessary
to enable the Debtors to effectively manage and reconcile claims.

Jonathan A. Carson, the President of KCC tells the Court that the
current fees charged by the professionals in his firm are:

     Clerical                           $40 to $65 per hour
     Bankruptcy Consultant              $125 to $195 per hour
     Senior Bankruptcy Consultant       $220 to $275 per hour
     Technology/Programming Consultant  $125 to $195 per hour

National Equipment Services, headquartered in Evanston, Illinois,
rents specialty and general equipment to industrial and
construction end users. The Company filed for chapter 11
protection on June 27, 2003 (Bankr. N.D. Ill. Case No. 03-27626).
James A. Stempel, Esq., at Kirkland & Ellis, represents the
Debtors in their restructuring efforts.  When the Company filed
for protection from its creditors, it listed debts and assets of
over $100 million each.


NATIONAL STEEL: Retirees' Committee Hires Seyfarth as Counsel
-------------------------------------------------------------
The Official Committee of Retired Employees of National Steel
Corporation seeks the Court's authority to retain Seyfarth Shaw as
its counsel retroactive to June 2, 2003.  The Retiree Committee
needs bankruptcy attorneys to prosecute its interests over and
with respect to National Steel retiree benefit plans.

The Retiree Committee wants Seyfarth to assist in:

    (a) its consultations with interested parties concerning the
        administration of the cases;

    (b) any investigation of the Debtors' assets, liabilities and
        financial condition and other relevant matters;

    (c) its participation in the formulation of a plan in these
        cases;

    (d) advising those it represents of its determinations
        concerning any plan formulated in these cases;

    (e) carrying out the purposes of Sections 1114 and 1129(a)(13)
        of the Bankruptcy Code, including the benefit plan
        analysis and alternatives, legal research, benefit claim
        analysis, and communications, proposals and negotiations;

    (f) structuring and implementing alternatives to cancellation
        of benefits and utilization of COBRA rights, including
        structuring and implementing alternative group insurance
        and the creation of a retiree association necessary to
        settle a trust implementing group insurance; and

    (g) its performance of other services as are in the interest
        of those it represents.

The Retiree Committee believes that Seyfarth is well qualified,
and has the necessary background, resources, expertise and
dedication to meet its legal needs in these cases.  Seyfarth is a
law firm comprised of 500 attorneys located in nine offices in
the United States and one in Europe.  It has extensive experience
in representing debtors and debtors-in-possession, secured and
unsecured creditors, creditors' committees, equity holders, and
trustees in Chapter 11 proceedings and adversary proceedings.  It
has skilled employee benefits department familiar with insolvency
issues.

Seyfarth will be compensated for its services in accordance with
the firm's customary standard hourly rates.  The positions,
practice areas and current hourly billing rates of the Seyfarth
professionals expected to be primarily responsible for providing
services to Retiree Committee are:

Professional          Position             Area              Rate
------------          --------             ----              ----
William J. Hanlon     Partner (Boston)     Bankruptcy        $350
Peter C. Miller       Partner (Chicago)    Employee Benefits  350
William J. Factor     Partner (Chicago)    Bankruptcy         320
Charles S. Riecke     Associate (Chicago)  Bankruptcy         235
Justin M. Crawford    Associate (Chicago)  Employee Benefits  200
Jennifer M. McManus   Paralegal (Chicago)  Bankruptcy         140

Seyfarth will also be entitled to reimbursement of actual
necessary expenses.

Seyfarth has performed limited, necessary services in relation to
these cases since June 2, 2003.

Seyfarth partner William J. Hanlon attests that no member of the
firm has any connection with the Debtors, their creditors, or any
other parties-in-interest.  Mr. Hanlon assures the Court that as
required by Section 1103(b), Seyfarth does not represent any
other entity having adverse interest in connection with the
cases.  Mr. Hanlon, however, discloses that, in 2002, Seyfarth
represented two entities that have asserted claims in these cases
-- Rudd Equipment Company and Amalgamet Inc.  Seyfarth assisted
Rudd Equipment with the filing of a proof of claim against the
Debtors and in contacting the Debtors' counsel shortly after the
Petition Date to inquire about the payment under an equipment
lease.  Seyfarth aided Amalgamet with the filing of a proof of
claim against the Debtors and in the period discussions with the
Debtors' counsel to ascertain the status of Amalgamet's
reclamation demand aggregating $90,000.  Seyfarth also renders
services to Amalgamet on unrelated matters.  But Mr. Hanlon
maintains that Seyfarth has recently advised both creditors that
it would not be able to represent them on any future matters in
the cases.  It will, however, continue to provide services on
unrelated matters. (National Steel Bankruptcy News, Issue No. 32;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


NEXTEL COMMS: S&P Ratchets Corporate Credit Rating Up a Notch
-------------------------------------------------------------
Standard & Poor's Ratings Services raised its corporate credit
rating on Reston, Va.-based wireless carrier Nextel Communications
Inc., to 'BB-' from 'B+'.

In addition, Standard & Poor's assigned its 'B+' rating to the
company's proposed $1 billion senior serial redeemable notes due
2015 to be publicly offered. The proposed new notes are rated one
notch below the corporate credit rating because of the amount of
material obligations that rank ahead of them. Among these are
about $4.5 billion of secured bank debt and about $2.5 billion of
current liabilities at various subsidiaries. Proceeds from the
proposed notes will be used to retire the 10.65% senior redeemable
discount notes due 2007 and redeem the 11.125% series E
exchangeable preferred stock.

The outlook is stable. At the end of second quarter 2003, Nextel
had about $11.8 billion of debt.

"The upgrade reflects Standard & Poor's more favorable assessment
of the company's intermediate term competitiveness and,
secondarily, an improvement in financial leverage," said credit
analyst Michael Tsao.

Based on an assessment of Nextel's network and established niche
in the business sector, Standard & Poor's does not expect Nextel
to be materially challenged by competitors through mid-2005.
Nextel has a proven overbuild frame relay network that is
optimized for push-to-talk (PTT) calls. Because competitors have
networks that were not designed with PTT in mind, competing PTT
offerings are unlikely to initially match Nextel's service quality
in the areas of latency, reliability, and multi-party calling
capability.

Nextel's sizable subscriber base in several industries (i.e.,
construction, services, and wholesale) also mitigates the impact
of competition. Subscribers in these industries have for years
used DirectConnect as a convenient and cost-efficient way to keep
in touch with each other. Because switching to a competing service
would entail loss of access to this network, a Nextel subscriber
may find it difficult to justify switching to a competitor. With
no effective competition expected, any potentially negative impact
from wireless number portability also likely will be limited.

Given that some of Nextel's competitors are substantially better
capitalized and are working on PTT technology with the cooperation
of several major equipment vendors, Nextel could face meaningful
competition starting in late-2005 to early-2006. Nextel also has
strengthened its balance sheet in the past year. The combination
of solid EBITDA growth and privately negotiated debt-for-equity
exchanges helped the company to lower debt-to-annualized EBITDA to
about 2.9x in second quarter 2003 from about 4.1x in the same
quarter a year ago. Given that Nextel is projected to perform
solidly in the next two years and that management remains
committed to further deleverage the balance sheet, Nextel's
financial risk profile could moderately improve.

Nextel had about $3.7 billion (about $2.4 billion of cash and $1.3
billion of bank credit facility availability) of liquidity at the
end of second quarter 2003. This level of liquidity, when combined
with such factors as moderate free cash flow prospect, no
significant debt maturities until 2007, and adequate headroom
under bank covenants, should provide the company with adequate
financial flexibility through 2006.


NIFF-CORR LLC: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Debtor: NIFF-CORR LLC
        1260 20th Road
        Tippecanoe, Indiana 46570

Bankruptcy Case No.: 03-34002

Type of Business: Sheet metal roofing manufacturer

Chapter 11 Petition Date: July 14, 2003

Court: Northern District of Indiana (South Bend Division)

Judge: Harry C. Dees, Jr.

Debtor's Counsel: Mark E. Wagner, Esq.
                  Kizer & Neu, LLP
                  1406 West Plymouth Street
                  P.O. Box 158
                  Bremen, IN 46506
                  Tel: 574-546-2626
                  Fax: 574-546-2608

Estimated Assets: $1 Million to $10 Million

Estimated Debts: $1 Million to $10 Million

Debtor's 20 Largest Unsecured Creditors:

Entity                      Nature Of Claim       Claim Amount
------                      ---------------       ------------
Coasted Steel Corp.         Purchase on account       $286,589
Dept. #159001
P.O. Box 67000
Detroit, MI 48267-1590

Hubbell Steel Corp.         Purchase on account       $243,489

Interstate Steel Company    Purchase on account        $54,916

Premier Resource Group      Purchase on account        $43,686

Promet Steel, Inc.          Purchase on account        $93,982

Samuel & Son Chicago Ltd.   Purchase on account        $71,070

Taylor Steel, Inc.          Purchase on account        $36,141

The Bradbury Company, Inc.  Purchase on account        $31,858

Wheeling-Trucking, Inc.     Purchase on account        $33,749

Alliance Trucking, Inc.     Purchase on account        $23,825

Ameristar                   Purchase on account        $44,882

Anchor Steel, LLC           Purchase on account        $46,653

Atlas Bolt & Screw          Purchase on account        $41,604

ECA Steel Corp              Purchase on account        $23,440

Harrington & King           Purchase on account        $27,485
Perforating Co., Inc.

Kenwood Metals, Inc.        Purchase on account        $22,000

Mako Metals, Inc.           Purchase on account        $75,020

Manuben-Itochu Steel USA    Purchase on account        $32,153

Medinah Metals LLC          Purchase on account        $22,064


NTELOS: Proposes New Board of Directors for Reorganized Debtor
--------------------------------------------------------------
NTELOS Inc., has completed a search for new members of its board
of directors. Following approval and confirmation of the Company's
Joint Plan of Reorganization, the Company will reconstitute its
board of directors, as called for in the Plan. The Company's new
board of directors will include Mr. Thomas E. Doster, Mr. Rudy F.
Graf and Ms. Susan A. McLaughlin, in addition to current directors
Messrs. A. William Hamill, John B. Mitchell, James S. Quarforth
and John B. Williamson, III. Biographies of each are provided
below.

James Quarforth, Chief Executive Officer of NTELOS, said, "We are
pleased with the experience and diverse backgrounds of the persons
who have agreed to serve on our new board of directors. Our new
board will provide the depth and breadth required to support our
primary business objectives and position the Company for long term
success. We also thank all of our existing and prior board members
for their years of dedication and service."

Biographical information for each of the persons who have agreed
to serve on the Company's new board of directors is as follows:

-- Thomas E. Doster currently serves as a Director with Morgan
   Stanley & Co., Incorporated. Mr. Doster is also a director of
   IMPSAT Fiber Networks, Inc., Logix Communications and Viatel
   Holdings Bermuda.

-- Rudy J. Graf currently serves as a member of the board of
   directors of Citizens Communications Company. Mr. Graf served
   as Vice Chairman, President and Chief Operating Officer for
   Citizens Communications Company from 1999 through 2002. Prior
   to 1999, Mr. Graf served as President and Chief Operating
   Officer of Centennial Communications.

-- A. William Hamill has been a director of NTELOS since 2001. Mr.
   Hamill is President of H3 Companies LLC, an investments and
   advisory firm. Mr. Hamill was formerly Executive Vice President
   and Chief Financial Officer of United Dominion Realty Trust,
   Inc.

-- Susan A. McLaughlin previously served as Executive Vice
   President and Chief Operating Officer of AGL Resources,
   President and Chief Executive Officer of Atlanta Gas Light
   Company, Chief Executive Officer of Virginia Natural Gas and
   President of Consumer Services of BellSouth Corporation. Ms.
   McLaughlin also served as a director of Target Corporation and
   Delphi Corporation.

-- John B. Mitchell, Sr. has been a director of NTELOS since 1989.
   Mr. Mitchell is President and Chairman of the Board of Hammond-
   Mitchell, Inc., a construction contractor in Covington,
   Virginia.

-- James S. Quarforth has been a director of NTELOS since 1987.
   Mr. Quarforth has been Chief Executive Officer of NTELOS since
   May 1, 1999.

-- John B. Williamson, III has been a director of NTELOS since
   2001. Mr. Williamson is President, Chief Executive Officer and
   a director of RGC Resources, Inc., Roanoke, Virginia.

The Company also filed a supplement of exhibits to its proposed
Joint Plan of Reorganization, containing draft forms of the
Purchase Agreement for the sale of $75 million aggregate principal
amount of new 9% convertible notes, the Indenture governing the
notes and certain other corporate documents, with the United
States Bankruptcy Court for the Eastern District of Virginia.

NTELOS and certain of its subsidiaries voluntarily filed for
reorganization under Chapter 11 of the United States Bankruptcy
Code on March 4, 2003 in order to complete development and
implementation of a comprehensive financial restructuring plan
that would significantly reduce the Company's debt.

The full text of the Disclosure Statement and the Joint Plan of
Reorganization, each dated July 1, 2003, together with the
supplement of exhibits to the Joint Plan of Reorganization, are
available on the Company's Web site at http://www.ntelos.com

NTELOS Inc. (OTC Bulletin Board: NTLOQ) is an integrated
communications provider with headquarters in Waynesboro, Virginia.
NTELOS provides products and services to customers in Virginia,
West Virginia, Kentucky, Tennessee and North Carolina, including
wireless digital PCS, dial-up Internet access, high- speed DSL
(high-speed Internet access), and local and long distance
telephone services.


OM GROUP: Ratings Off Watch Due to Unit's Nearing Divestiture
-------------------------------------------------------------
Standard & Poor's Ratings Services affirmed its 'B+' corporate
credit rating on specialty chemical and refined metal products
producer OM Group Inc. based on the expected completion of its
agreement to sell its precious metals business.

Standard & Poor's said that at the same time it has removed its
ratings on Cleveland, Ohio-based OM from CreditWatch where they
were placed Oct. 31, 2002. The current outlook is stable.

OM Group is expected to complete its definitive agreement to sell
its precious metals business to Umicore S.A. for about $752
million in cash. "The pending sale, which is expected to close in
the third quarter of 2003, was incorporated into the ratings and
is a positive for credit quality, given that net proceeds of about
$700 million have been earmarked for debt reduction," said
Standard & Poor's credit analyst Wesley E. Chinn. "Still, the
financial profile will remain highly leveraged, the business
profile will be less robust, and the outlook for higher cobalt and
nickel prices remains uncertain. If the sale of the precious
metals business, which is still subject to regulatory review, does
not occur, it would clearly have negative implications for OM's
credit prospects," he said.

Standard & Poor's said that its ratings on OM reflect the
company's position as an established provider of metal-based
specialty chemical and refined metal products and expected
satisfactory liquidity, overshadowed by the vulnerability of its
operating margins and profitability to the volatility of cobalt
and nickel prices, political and civil instability risks in the
Democratic Republic of Congo, its principal cobalt supplier, long-
term nickel supply uncertainties, and a heavy debt load.


OWENS: Claims Status Modification Hearing Continues on July 28
--------------------------------------------------------------
Owens Corning and its debtor-affiliates want the Court to modify
the status of 261 claims from priority to general unsecured non-
priority.

Since the Bar Date, the Debtors and their advisers have been
reviewing the Proofs of Claim filed in these cases.  Based on the
review, Mark W. Mayer, the Debtors' Vice President for Global
Accounting, declares that these Disputed Claims were filed with
the incorrect priority status.  That is, each of the Disputed
Claims asserts a "priority" status under Section 507(a) to which
they are not entitled.

These claims include:

    Claimant                           Claim No.  Claim Amount
    --------                           ---------  ------------
    2 Scale                              12085     $359,725.63
    Braddock, Richard S.                  6299      200,000.00
    Creative Advantage, Inc.              7652      145,343.34
    Davison Petroleum Products LLC        6914      412,246.12
    Export Development Canada             3943      211,527.04
    Granzow, Dennis                       5979      113,000.00
    Hayes, Jack                           5362      250,000.00
    Marsh USA, Inc.                       6910      211,486.00
    Mead Corp.                            5390      268,892.00
    Warren Co. Metro School District      4874      119,247.00
    Wausau Insurance Companies           12070      245,033.00
    Wiltsie, Allan                        8887      545,000.00
    Wise Metals Group LLC                 2326      175,753.60
    YWCA Battered Womens Shelter          7960      200,000.00
    Zaske, Linda                          7000      246,000.00

Maria Aprile Sawczuk, Esq., at Saul Ewing LLP, in Wilmington,
Delaware, assures the Court that any claimant holding a Disputed
Claim will suffer no prejudice by having the priority status of
its Disputed Claim modified because the claimant's underlying
claim amounts are not subject to this objection.  However, the
Debtors reserve their right to later file objections to the
amount and allowability of the Disputed Claims on any grounds
that the law permits.  The objections, if any, will be properly
filed and noticed at a later date.

                         *     *     *

Judge Fitzgerald sustains the Debtors' objection except for
Leonard Berger Ph.D.'s and Armstrong and Bragg Home Service's
claims, which will be heard further on July 28, 2003. (Owens
Corning Bankruptcy News, Issue No. 55; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


OWENS-ILLINOIS: Reports Decline in Second Quarter Fin'l Results
---------------------------------------------------------------
Owens-Illinois, Inc., (NYSE: OI) reported second quarter 2003 net
earnings of $17.0 million, compared with net earnings for the
second quarter of 2002 of $96.9 million.

Results for the second quarter of 2003 included a loss of $37.4
million ($37.4 million after tax) from the sale of long-term notes
receivable and additional interest charges of $16.8 million ($10.7
million after tax) for early retirement of debt, principally note
repurchase premiums.  Exclusive of these items, earnings in the
second quarter of 2003 were $65.1 million.

Operating results in the second quarter of 2003 continued to be
unfavorably impacted by higher energy costs, reduced pension
income, lower glass unit shipments in North America, South
America, and the Asia Pacific region, and competitive pricing
pressures in most of the Company's plastics businesses.

Joseph H. Lemieux, Owens-Illinois Chairman and Chief Executive
Officer said, "Despite continued global economic uncertainty, our
manufacturing operations are in good shape.  We are also pleased
at the completion of several refinancing activities dating back to
January of last year, including our $1.9 billion bank credit
agreement, which illustrates strong support in the future of our
operations from the investment community."

                        Business Review

Summary

Second quarter 2003 net sales were $1.580 billion compared with
$1.497 billion in the second quarter of 2002.  On a segment
reporting basis, EBIT for the second quarter of 2003 was $219.0
million compared with $249.6 million for the second quarter of
2002.

Glass Containers Segment

The Glass Containers segment reported second quarter 2003 net
sales of $1.075 billion, up 4.8% from $1.026 billion in the second
quarter of 2002. Segment EBIT was $184.3 million for the second
quarter of 2003 compared with $192.9 million for the second
quarter of 2002. EBIT margins in the second quarter of 2003 were
17.2% compared with 18.8% in the second quarter of 2002. Pension
income was approximately $9.7 million lower, contributing to the
reduction in Segment EBIT and EBIT margins.

Within the segment, North American glass container operations
reported lower sales and EBIT for the second quarter of 2003
compared with the second quarter of 2002.  Higher energy costs and
lower unit shipments, principally containers for beer, were
partially offset by improved pricing, lower operating expenses,
and a more favorable product sales mix.  Most of the reduction in
pension income for the Glass Containers Segment was in North
America.

European glass container operations reported improved sales and
EBIT for the second quarter of 2003 compared with the second
quarter of 2002.  The favorable effects of higher unit shipments,
increased selling prices, favorable currency translation rates,
and improved manufacturing performance were partially offset by
higher energy costs.

Asia Pacific glass container operations reported lower EBIT for
the second quarter of 2003 compared with the second quarter of
2002, while sales approximated the prior year period.  Unit
shipments in Australia were lower, principally for wine and beer
containers.  And in China, unit sales volumes in both Shanghai and
Guangdong were impacted by the SARS epidemic.  Lower pricing
in Australia, principally for wine containers, also contributed to
lower sales and EBIT. In New Zealand, a furnace rebuild further
contributed to the year-over-year EBIT decline.  Favorable
currency translation rates offset the effect of lower volumes and
pricing on net sales.  The volume and price effects on EBIT were
partially offset by favorable currency translation rates and
improved manufacturing performance in most of the Asia Pacific
region.

In the South American glass container operations, second quarter
2003 sales declined approximately 12% from a year ago.  The
primary factors contributing to the reduced sales were lower unit
shipments and unfavorable currency translation.  Despite these
negative factors, EBIT for South American glass container
operations was essentially equal to a year ago reflecting the
positive effect of higher selling prices and improved
manufacturing efficiencies and labor productivity.

Plastics Packaging Segment

For the second quarter of 2003, the Plastics Packaging segment
reported net sales of $505.0 million compared with net sales of
$471.0 million for the second quarter of 2002.  Resin cost pass-
through pricing to customers increased sales $38 million in the
quarter.  Segment EBIT for the second quarter of 2003 was $53.7
million compared with EBIT of $78.2 million for the second quarter
of 2002.  The principal factors contributing to the EBIT decline
were lower selling prices in most of the segment's businesses,
reduced sales and EBIT within the Company's advanced technology
systems business, and an approximate $2.2 million reduction in
pension income.  EBIT for the second quarter of 2003 was favorably
impacted by an approximate 8% increase in unit shipments over the
prior year period.

Other Retained Items

Other retained costs were $2.5 million lower in the second quarter
of 2003 compared with the second quarter of 2002.  A $1.1 million
reduction in pension income was more than offset by reduced
administrative costs.

Interest Expense

Interest expense, excluding charges for early debt retirement,
increased to $121.6 million in the second quarter of 2003 from
$106.2 million in the second quarter of 2002.  The higher interest
in 2003 was mainly due to the issuance of $625 million of fixed
rate notes during the fourth quarter of 2002 and $900 million of
fixed rate notes in May 2003.  The proceeds from the notes were
used to repay lower-cost variable rate debt borrowed under the
Company's bank credit agreement.  Lower interest rates on the
Company's remaining variable rate debt partially offset the
increase.  Interest expense for the second quarter of 2003
included charges of $13.2 million for premiums and the write-off
of unamortized finance fees related to the repurchase of $263.5
million principal amount of 7.85% Senior Notes due 2004, and
$3.6 million for the write-off of unamortized finance fees related
to the reduction of commitments under the bank credit agreement.

Sale of Notes Receivable

On July 11, 2003, the Company received payments totaling 100
million British pounds sterling (US$163.0 million) in connection
with the sale to Ardagh Glass Limited of certain long-term notes
receivable.

The notes were received from Ardagh in 1999 by the Company's
wholly-owned subsidiary, United Glass Limited, in connection with
its sale of Rockware, a United Kingdom glass container
manufacturer obtained in the 1998 acquisition of the worldwide
glass and plastics packaging businesses of BTR plc.  The notes
were due in 2006 and interest had previously been paid in kind
through periodic increases in outstanding principal balances.

The proceeds from the sale of the notes were used to reduce
outstanding borrowings under the Company's bank credit agreement.

The notes were sold at a discount of approximately 22.6 million
British pounds sterling.  The resulting loss of US$37.4 million
(US$37.4 million after tax) was included in the results of
operations of the second quarter of 2003.

Six-month Results

For the first six months of 2003, the Company reported net
earnings of $51.4 million, compared with a net loss of $608.4
million for the first six months of 2002. Results for the first
half of 2003 included a loss of $37.4 million ($37.4 million after
tax) from the sale of long-term notes receivable and additional
interest charges of $16.8 million ($10.7 million after tax) for
early retirement of debt, principally note repurchase premiums.
Exclusive of these items, earnings in the first half of 2003 were
$99.5 million.  Results for the first half of 2002 included:  1) a
charge for future asbestos related costs of $475 million ($308.8
million after tax), 2) additional charges of $10.9 million ($6.7
million after tax) for early retirement of debt, and 3) a charge
for the change in method of accounting for goodwill of $460
million ($460 million after tax).   Exclusive of these items,
earnings in the first half of 2002 were $167.1 million.

Effective Tax Rate

Excluding the effects of the loss on the sale of long-term notes
receivable in 2003, the effects of the first quarter 2002
asbestos-related charge, and the additional interest charges for
early retirement of debt in all periods, the Company's estimated
effective tax rate for the first six months of 2003 was 31.6%
compared with an estimated rate of 31.6% for the first six months
of 2002 and an actual rate of 30.1% for the full year 2002. The
increase from the actual rate for the full year 2002 to the
estimated rate for 2003 is due to a shift in estimated
international earnings toward countries with higher effective tax
rates.

                         Refinancing Activities

During the second quarter of 2003, the Company completed its
refinancing activities that began in January 2002.  During that
17-month period, various operating subsidiaries of the Company
placed $1 billion principal amount 8-7/8% Senior Secured Notes due
February 15, 2009; $625 million principal amount 8-3/4% Senior
Secured Notes due November 15, 2012; $450 million principal amount
7-3/4% Senior Secured Notes due May 15, 2011 and $450 million
principal amount 8-1/4% Senior Notes due May 15, 2013.  The net
proceeds from issuing these notes were used to repay outstanding
borrowings and reduce commitments under the bank credit agreement,
repurchase in a tender offer $263.5 million of the 7.85% Senior
Notes due 2004, and pay related note repurchase premiums and
transaction costs.

On June 13, 2003, the Company and certain of its subsidiaries
entered into an amended and restated bank credit agreement
totaling $1.9 billion consisting of a $600 million revolving
credit facility and a $460 million A term loan, each of which has
a final maturity date of April 1, 2007, and an $840 million B term
loan, which has a final maturity date of April 1, 2008.  Proceeds
from borrowings under the amended and restated agreement were used
to repay all amounts outstanding under the Company's $1.9 billion
credit agreement which had been scheduled to mature on March 31,
2004.  As a result of these refinancing activities, the Company's
next significant debt maturity will be $350 million in May 2005.

The impact of refinancing lower-cost, shorter-term variable rate
debt with higher-cost, longer-term fixed rate debt is expected to
increase interest expense in the second half of 2003 by
approximately $22 million over the second half of 2002 based on
current short-term rates.  Higher expected average debt
outstanding is also expected to increase interest expense in the
second half of 2003 over the second half of 2002 by approximately
$6 million, making the total expected increase in interest expense
approximately $28 million over the second half of 2002.

                            Asbestos

Asbestos-related cash payments for the second quarter of 2003 were
$44.8 million, a reduction of $5.6 million, or 11.1%, from the
second quarter of 2002.  For the six months of 2003, cash payments
were $99.9 million, a reduction of $11.8 million, or 10.6%, from
the first six months of 2002.  As of June 30, 2003, the number of
asbestos-related claims pending against the Company was
approximately 30,000, up from approximately 24,000 pending claims
at December 31, 2002.  In April, the Company received
approximately 5,000 new filings in advance of the effective date
of the recently enacted Mississippi tort reform law.
Approximately 60% of those filings are cases with exposure dates
after the Company's 1958 exit from the business for which the
Company takes the position that it has no liability.  The Company
anticipates that cash flows from operations and other sources will
be sufficient to meet all asbestos-related obligations on a short-
term and long-term basis.

Owens-Illinois is the largest manufacturer of glass containers in
North America, South America, Australia and New Zealand, and one
of the largest in Europe.  O-I also is a worldwide manufacturer of
plastics packaging with operations in North America, South
America, Europe, Australia and New Zealand. Plastics packaging
products manufactured by O-I include consumer products (blow
molded containers, injection molded closures and dispensing
systems) and prescription containers. More information on the
Company can be obtained at http://www.o-i.com

As reported in Troubled Company Reporter's April 25, 2003 edition,
Fitch Ratings assigned a 'BB' rating to Owens-Illinois' (NYSE:
OI) $450 million senior secured notes and a 'B+' rating to its
$350 million senior notes offered in a private placement. The
senior secured notes are due 2011 and the senior notes are due
2013. The Rating Outlook remains Negative.


PACIFIC GAS: Gets Nod to Pay $281 Million Mortgage Bond Maturity
----------------------------------------------------------------
PG&E Corporation's (NYSE: PCG) utility unit, Pacific Gas and
Electric Company, has received approval from the U.S. Bankruptcy
Court to pay $281 million of 6-1/4 percent Series 93C First and
Refunding Mortgage Bonds maturing August 1, 2003. Pacific Gas and
Electric Company will pay the bondholders from its current
available cash.

Bondholders who hold the bonds in a brokerage account will have
principal and interest paid to their account. Certificate holders
will need to deliver their certificates to the trustee, The Bank
of New York, to receive payment for the principal. Interest checks
to certificate holders will be mailed separately.


PACIFIC GAS: Modifies BNY Stipulation re Cash Collateral Use
------------------------------------------------------------
Pacific Gas and Electric Company asks the Court to approve another
modification to a stipulation with BNY Western Trust Company
regarding the use of cash collateral to provide for PG&E's timely
payment of the principal amount of mortgage bonds scheduled to
mature on August 1, 2003 aggregating $281,000,000.  BNY Western
Trust is the successor trustee pursuant to a December 1, 1920
indenture with respect to the 1993 Series C mortgage bonds issued
by PG&E.

The current principal amount outstanding of the 1993 Series C
Bonds is $290,500,000.  However, $9,500,000 of these Bonds are
held in treasury by PG&E.  Rather than seeking to pay the
$9,500,000 in principal amount of the Bonds held in treasury --
which would entail the prompt "roundtripping" of the $9,500,000 by
first paying it to BNY Western Trust, who would then pay it to
PG&E in satisfaction of the Bonds held in treasury -- PG&E
proposes to cancel the $9,500,000 held in treasury on or before
the August 1, 2003 maturity date, and pay on maturity the
$281,000,000 principal amount of the 1993 Series C Bonds held by
the pubic.

PG&E represents that the payment will benefit the estate
financially because the Bonds accrue interest at a rate
significantly in excess of the rates it currently earns on its
cash balances.  The 1993 Series C Bonds accrue interest at 6.25%
per annum.  If PG&E is authorized to make the August 2003
principal payment on the Bonds, it expects to do so using cash
currently held by the estate.  As reported on its most recent
Operating Report, PG&E had a $3,600,000 cash balance as of
April 30, 2003.  By contrast, if PG&E fails to timely make the
August 2003 principal payment, it risks being in default under the
Indenture and the negative consequences that may flow from the
default like the potential acceleration of all series of the
Bonds.

PG&E's obligations under the Indenture are substantially
oversecured.  The total unpaid indebtedness under the Bonds is
$3,300,000,0000.  Such indebtedness is secured by a first-
priority lien on substantially all of PG&E's assets.  PG&E
reported $26,600,000,000 in total assets as of April 30, 2003 on
its most recently filed Operating Report.  In addition, PG&E is
solvent and expects to pay all allowed claims against the
Debtor's estate in full.  Thus, there is little doubt that the
Bonds will eventually be satisfied in full.

In May 2001, the Court approved PG&E and BNY Western Trust's
stipulation (i) authorizing and restricting use of cash collateral
pursuant to Section 363 of the Bankruptcy Code and Rule 4001 of
the Federal Rules of Bankruptcy Procedure and (ii) granting
adequate protection pursuant to Bankruptcy Code Sections 361 and
363.  The Original Stipulation provides for PG&E's continued use
of cash collateral in which BNY Western Trust has an interest --
on behalf of the Bondholders -- pursuant to certain conditions and
restrictions.  Among other things, the Original Stipulation
provides for the timely payment of interest and sinking fund
payments as provided under the Indenture.  The annual amount of
interest and sinking fund payments currently accruing on the Bonds
is $260,000,000.

The parties modified the Original Stipulation in February 2002 to
permit PG&E's timely payment of the $333,000,000 in principal
amount of mortgage bonds that matured on March 1, 2002.  PG&E and
BNY Western Trust Trustee have continued to perform their
obligations under the Stipulation.

The Stipulation currently provides that:

      "As additional adequate protection hereunder, the
      Indenture Trustee and the Bondholders shall be entitled
      to the payment of accrued and unpaid interest and sinking
      fund payments due and payable under the Indenture (the
      "Pre-Petition Indebtedness") on or prior to the Petition
      Date at the prevailing rate (with respect to interest
      payments) in effect under the Indenture.  Additionally,
      interest on the Pre-Petition Indebtedness shall continue to
      accrue subsequent to the Petition Date at the prevailing
      rate under the Indenture and shall be payable on the terms
      set forth therein.  Furthermore, any and all sinking fund
      payments that become due subsequent to the Petition Date
      shall be payable on the terms set forth in the Indenture.
      In addition the principal amount of the Bonds scheduled to
      mature on March 1, 2002 in the approximate amount of $333
      million shall be payable on the terms set forth in the
      Indenture."

The parties have agreed to modify the Stipulation to add this
provision:

      "In addition the principal amount of the Bonds scheduled
      to mature on August 1, 2003 in the approximate amount of
      $281 million shall be payable on the terms set forth in
      the Indenture."

PG&E represents that the modification to the Stipulation is
consistent with the Court's Guidelines for Cash Collateral and
Financing Stipulations. (Pacific Gas Bankruptcy News, Issue No.
60; Bankruptcy Creditors' Service, Inc., 609/392-0900)


PEABODY ENERGY: Board Raises Cash Quarterly Dividend by 25%
-----------------------------------------------------------
Peabody Energy's board of directors has approved a 25 percent
increase in the regular quarterly dividend on common stock, to
$0.125 per share.  The increased dividend is payable on August 26,
2003, to shareholders of record on August 5, 2003.

Directors also authorized management to implement a dividend
reinvestment plan to allow shareholders to reinvest dividends in
BTU shares without paying transaction fees.  The company will
subsequently communicate full details of the plan to shareholders.

Peabody Energy (NYSE: BTU) is the world's largest private-sector
coal company, with 2002 sales of 198 million tons of coal and $2.7
billion in revenues.  Its coal products fuel more than 9 percent
of all U.S. electricity generation and more than 2 percent of
worldwide electricity generation.

                          *    *    *

As previously reported in Troubled Company Reporter, Fitch
Ratings assigned a 'BB+' to Peabody Energy's proposed $600
million revolving credit facility and a new $600 million bank
term loan and a 'BB' to its issuance of $500 million of senior
unsecured notes due 2013. The Rating Outlook remains Positive.


PG&E NATIONAL: Look for Schedules and Statements by August 22
-------------------------------------------------------------
Section 521(1) of the Bankruptcy Code requires every debtor to
file Schedules of Assets and Liabilities and a Statement of
Financial Affairs.  Rule 1007(c) of the Federal Rules of
Bankruptcy Procedure allows the debtor to file its Schedules and
Statements within 15 days after the Petition Date.  However, the
conduct and operation of the PG&E National Energy Group Debtors'
business requires them to maintain voluminous books and records
and a complex accounting system.  Due to the number of Debtors,
the number of creditors, the complexity of the Debtors'
businesses, and the diversity of their operations and assets, it
is impossible to produce and deliver coherent and complete
Schedules and Statements within the mandated 15 days.  At present,
the NEG Debtors are still in the process of assembling the
information necessary to complete the Schedules and Statements.

At the NEG Debtors' behest, Judge Mannes extends their deadline
to file Schedules and Statements to August 22, 2003.  The benefit
the extension will produce is increased accuracy in the Debtors'
Schedules and Statements.  The extension will provide the Debtors
sufficient time to prepare and file the Schedules and Statements.

As of March 31, 2003, PG&E National Energy Group and its 190
subsidiaries had $7,600,000,000 in total assets and $8,980,000,000
in total liabilities (book value).  For the quarter ending March
31, 2003, NEG sustained a $400,000,000 net loss.

The Office of the United States Trustee has advised the NEG
Debtors that it will not oppose this request on the condition
that the Debtors don't seek any further extensions.  The Debtors
agree that they will not seek further extensions and will file
their Schedules and Statements no later than August 22, 2003.  In
addition, the NEG Debtors will work with the U.S. Trustee and any
subsequently appointed creditors' committee to make available
sufficient financial date and creditor information to permit at
least an initial meeting of creditors pursuant to 11 U.S.C. Sec.
341(a) to be timely held. (PG&E National Bankruptcy News, Issue
No. 3; Bankruptcy Creditors' Service, Inc., 609/392-0900)


QUANTUM CORP: Fiscal First Quarter Net Loss Stands at $9 Million
----------------------------------------------------------------
Quantum Corp. (NYSE: DSS), a leading provider of data protection
systems, announced that revenue for its fiscal first quarter,
ended June 29, 2003, was $202 million. The company reported a GAAP
net loss of $9 million for the June quarter and a non-GAAP loss of
$5 million, both of which included the negative impact of $3
million in tax costs related to foreign withholding taxes.

As Quantum announced when it revised its FQ1 expectations earlier
in the month, the company's results were driven primarily by
lower-than-expected media revenue and, to a lesser extent, lower
tape drive revenue after two quarters of significant growth.
Despite the lower revenue, gross margin rates were up slightly
from the March quarter, and operating expenses were down
sequentially to $66 million on a GAAP basis and $64 million on a
non-GAAP basis.

"Over the last year, we have been working to execute an aggressive
plan to return Quantum to a position of sustained growth and
profitability," said Rick Belluzzo, chairman and chief executive
officer of Quantum. "As a result, we have improved many of the
fundamentals underlying our business, as evidenced by the two
quarters of solid momentum that preceded FQ1. We continued to see
progress in several areas in the June quarter, but this was
unfortunately overshadowed by the lower-than-expected media
revenue. As I've said before, there is still more work to do, and
we will continue to focus intensely on improving our performance."

In the last year, Quantum has expanded its product lines, secured
several key OEM wins, increased operational efficiency and reduced
costs. As a result, the company saw several positive year-over-
year comparisons for FQ1. For example, overall Storage Solutions
Group revenue was up significantly, tape drive revenue also
increased, and operating expenses were down, with a significant
decline in general and administrative expenses.

Fiscal 2004 first quarter revenue in the DLTtape(TM) Group was
$146 million, comprised of $55 million in total tape media revenue
and $91 million in tape drive revenue. The shortfall in expected
media revenue reflected the impact of continued economic weakness,
particularly in Europe. This resulted in lower-than-expected media
prices that, in turn, led to a reduction in sales of Quantum-
branded media, Quantum royalties (which are based on licensee
revenues) and inventory levels held by media resellers.

Although FQ1 tape drive revenue was lower-than-expected, it was
still up nearly a third compared to the June quarter last year,
and tape drive gross margins increased for the third consecutive
quarter. Super DLTtape(TM) shipments remained roughly flat
sequentially, as expected. Quantum continues to execute on its
industry-leading tape drive roadmap, with the SDLT 600 super drive
on track for qualifications this summer and general availability
in the fall.

Fiscal 2004 first quarter revenue in Quantum's Storage Solutions
Group, which includes tape automation, services and enhanced
backup solutions, was $66 million. This represented an increase of
7% sequentially and more than 30% over the comparable quarter last
year. The company's leadership in the high-volume autoloader space
was again evident in FQ1, as sales of its ValueLoader(TM) and
SuperLoader(TM) again grew sequentially. Shipments of Quantum's
DX30 enhanced backup system also increased over the prior quarter.

The positive results in SSG reflected the work Quantum has done to
broaden its product lines and strengthen its go-to-market model
over the past year, and the company is continuing to refine its
SSG sales model further to offer a more solutions-oriented
approach to enterprise customers. This will be particularly
important as Quantum prepares to launch the DX100, its second-
generation enhanced backup solution, in the fall.

In addition to reporting its FQ1 results, Quantum also provided
its outlook for the second quarter of fiscal year 2004. The
company said it expects total revenues to be flat to slightly up
from FQ1, and GAAP and non- GAAP gross margins to be roughly flat.
GAAP operating expenses are expected to be in the range of $67
million to $70 million, with non-GAAP operating expenses
anticipated to be in the $63 million to $66 million range. As a
result, Quantum expects the GAAP loss per share to be in the range
of 5 to 7 cents and the non-GAAP loss per share to be in the 1 to
3 cent range. Both the GAAP and non-GAAP outlook include an
expected $2.5 million negative impact related to media royalty
withholding taxes, and the difference between the GAAP and non-
GAAP figures reflects amortization of acquisition-related
intangibles, as well as $1 million to $2 million in expected
restructuring charges.

"As I look toward the remainder of the current quarter and beyond,
our priorities are clear -- drive revenue growth through new
products and enterprise sales efforts; work to reverse the media
trend we saw in FQ1 through new products and expansion of our
target market; and continue to improve gross margins and reduce
expenses," said Belluzzo. "The economic environment remains
challenging, but we are confident that these priorities -- along
with the actions we've taken over the past year -- are the right
ones to position Quantum for success. We are a more focused, more
efficient company than we were a year ago, and we are excited
about the future and the leading role we will continue to play in
data protection."

Quantum Corp., founded in 1980, is a global leader in data
protection, meeting the needs of business customers with
enterprise-wide storage solutions and services. Quantum is the
world's largest supplier of half-inch cartridge tape drives, and
its DLTtape technology is the standard for tape backup and
archiving of business-critical data for the mid-range enterprise.
Quantum is also a leader in the design, sale and service of
autoloaders and automated tape libraries used to manage, store and
transfer data. Over the past year, Quantum has been one of the
pioneers in the emerging market of disk-based backup, offering a
solution that emulates a tape library and is optimized for data
protection. Quantum sales for the fiscal year ended March 31,
2003, were $871 million. Quantum Corp., 1650 Technology Drive, San
Jose, CA 95110, 408-944-4000, http://www.quantum.com

As previously reported, Standard & Poor's Ratings Services lowered
its corporate credit rating on Quantum Corp., to double-'B'-minus
from double-'B' and its subordinated debt rating to single-'B'
from single-'B'-plus.


REGAL ENTERTAINMENT: Reports Slight Improvement in Q2 Results
-------------------------------------------------------------
Regal Entertainment Group (NYSE:RGC) (S&P/ BB- Corporate Credit
Rating), a leading motion picture exhibitor owning and operating
the largest theatre circuit in the United States under the Regal
Cinemas, United Artists Theatres, Edwards Theatres and Hoyts
Cinemas brands and its media company, Regal CineMedia, announced
second quarter 2003 results.

Total revenue for the quarter ended June 26, 2003 was $648.1
million, a 6.7% increase compared to total pro forma revenue of
$607.3 million for the second quarter of 2002. Net income
increased 1.3% to $47.1 million in the second quarter of 2003
compared to pro forma net income of $46.5 million in the
comparable quarter of 2002. Earnings per diluted share, excluding
merger and restructuring expenses (net of related tax effect),
decreased 5.6% to $0.34 for the second quarter of 2003 compared to
the pro forma amount in the second quarter of 2002. Adjusted
EBITDA of $136.1 million for the quarter ended June 26, 2003
increased 0.5% from the pro forma amount in the comparable period
in 2002 and represented an Adjusted EBITDA margin of 21.0%. The
results of operations for the Company include the results of
operations for the acquired Hoyts theatres for all periods
subsequent to March 27, 2003. Reconciliations of non-GAAP measures
are provided in the financial schedules accompanying the press
release.

Regal's Board of Directors also declared a cash dividend of $0.15
per Class A and Class B common share, payable on September 12,
2003, to stockholders of record on August 25, 2003. The Company
intends to pay a regular quarterly dividend for the foreseeable
future at the discretion of the Board of Directors depending on
available cash, anticipated cash needs, overall financial
condition, loan agreement restrictions, future prospects for
earnings and cash flows as well as other relevant factors.

"This was a significant quarter for Regal Entertainment Group in
that we produced another quarter of solid financial results in a
challenging box office environment. In addition, we returned value
to shareholders in the form of an extraordinary dividend of $5.05
per share, completed the integration of the acquired Hoyts
theatres and strengthened our base of long-term shareholders,"
stated Mike Campbell, CEO of Regal Entertainment Group's theatre
operations and Co-CEO of Regal Entertainment Group. "We are also
pleased that our strong cash position and free cash flow
generation allowed the Company to declare a regular quarterly
dividend of $0.15 per share, which maintains our quarterly
dividend at historical levels," Campbell continued.

Kurt Hall, Chief Executive Officer of Regal CineMedia and Co-CEO
of Regal Entertainment Group stated, "The deployment of the
Digital Content Network continues to track ahead of plan and under
budget with over 3,000 screens now deployed, on our way to
approximately 5,000 screens by Q1 2004. The growing geographic
reach of our digital network, combined with the higher quality of
our digital pre show "The 2WENTY", has been well received by
theatre patrons and advertisers. By providing a more cost
effective and efficient cinema advertising and marketing solution,
we are beginning to expand the universe of clients who are using
cinema as part of their marketing plans."

Regal Entertainment Group (NYSE:RGC) is the largest motion picture
exhibitor in the world. The Company's theatre circuit, comprising
Regal Cinemas, United Artists Theatres, Edwards Theatres, and
Hoyts Cinemas operates 6,119 screens in 562 locations in 39
states. Regal operates approximately 17% of all screens in the
United States including theatres in 46 of the top 50 U.S.
Designated Market Areas and growing suburban markets. We believe
that the size, reach and quality of the Company's theatre circuit
not only provide its patrons with a convenient and enjoyable
movie-going experience, but is also an exceptional platform to
realize economies of scale in theatre operations and, through
Regal CineMedia, develop new sources of revenue and cash flow by
utilizing Regal's existing asset base.

Regal CineMedia is a wholly owned subsidiary of Regal
Entertainment Group focusing on the expansion and development of
advertising and new uses for Regal's theatre assets, while at the
same time enhancing the movie-going experience. Regal CineMedia
operates other divisions that focus on meetings and special
productions in a theatre environment, including the presentation
of live sports and entertainment events, as well as the sale of
group tickets and gift certificates.

Additional information is available on the Company's Web site at
http://www.REGmovies.comor http://www.regalcinemedia.com


RENT-WAY INC: SEC and U.S. Attorney Complete Investigation
----------------------------------------------------------
Rent-Way, Inc. (NYSE: RWY) reported that the Securities and
Exchange Commission and the U.S. Attorney for the Western District
of Pennsylvania have concluded their investigation of the company.

In connection with the civil action taken by the SEC, the company
has consented to the entry of an order requiring compliance with
the record keeping and reporting provisions of the Exchange Act.
The SEC did not seek any financial penalty against the company,
its current officers or directors, nor will the U.S. Attorney
bring any charges against the company or current officers and
directors.

In response to the actions announced today, William E.
Morgenstern, Chairman and CEO of Rent-Way, stated, "We are pleased
that the investigation has been completed and believe the final
results are consistent with our internal investigation."

Tuesday's SEC release stated, "The Commission considered that
Rent-Way undertook remedial actions and cooperated with
commissions staff."

In a release issued Tuesday, United States Attorney Mary Beth
Buchanan recognized "the significant cooperation provided by
company officials at Rent-Way" and stressed that the Company had
been "fully and openly cooperating with the government."

Also, according to a statement made Tuesday, the U.S. Attorney and
the Securities and Exchange Commission have announced that action
will be taken against three former employees.

Mr. Morgenstern concluded, "This marks a new beginning for Rent-
Way.  The distractions managing our business in the wake of the
accounting irregularities announced over 32 months ago are behind
us.  Looking ahead, we plan to focus on growing our business and
increasing profitability in our stores.  We have taken steps to
reposition our company for growth, both financially and
operationally.  In particular, our recently completed refinancing
has provided us with the financial resources we need to execute
our business plan and take advantage of opportunities in the
vibrant rent-to-own market."

Rent-Way is one of the nation's largest operators of rental-
purchase stores. Rent-Way rents quality name brand merchandise
such as home entertainment equipment, computers, furniture and
appliances from 753 stores in 33 states.

As reported in Troubled Company Reporter's June 5, 2003 edition,
Standard & Poor's Ratings Services raised its corporate credit
rating on Rent-Way Inc., to 'B+' from 'CCC'. The rating was
removed from CreditWatch where it had been placed May 13, 2003.
The outlook is stable.

In addition, Standard & Poor's assigned its 'BB-' rating to the
company's $60 million senior secured bank loan, and its 'B-'
rating to $205 million senior secured notes. The bank loan
rating continues to be preliminary and is subject to review upon
final documentation. The Erie, Pennsylvania-based company had
$213 million of debt outstanding as of March 31, 2003.


RURAL CELLULAR: S&P Junks $325 Million Senior Notes at CCC
----------------------------------------------------------
Standard & Poor's Ratings Services assigned its 'CCC' rating to
Rural Cellular Corp.'s $325 million senior notes due 2010, issued
under Rule 144A with registration rights.

Simultaneously, Standard & Poor's lowered its ratings on Rural
Cellular's corporate credit and bank loan to 'B-' from 'B', the
subordinated debt rating to 'CCC' from 'CCC+', and the preferred
stock rating on the company's junior exchangeable preferred stock
to 'CCC-' from 'CCC'. At the same time, Standard & Poor's lowered
the rating on the company's 11-3/8% senior exchangeable preferred
stock to 'D' from 'CCC-'. This follows the company's announcement
that its board of directors has determined not to declare the
quarterly cash dividend on this instrument (the carrying value of
which was $248 million as of March 31, 2003), which was due to pay
cash dividends beginning August 1, 2003.

"The ratings are removed from CreditWatch where they were placed
on April 14, 2003 because of weakened industry fundamentals," said
credit analyst Rosemarie Kalinowski. The proposed senior unsecured
notes are rated two notches below the corporate credit rating
because the ratio of priority obligations to total assets exceeds
30%. The outlook is stable. Proceeds of the new note issue
together with $41 million of cash will be used to repay $356
million of bank debt.

Alexandria, Minn.-based Rural Cellular provides wireless voice
services to more than 722,000 subscribers in rural markets
covering the Midwest, Northeast, South, and Northwest regions of
the U.S. Pro forma for the new notes, as of March 31, 2003, total
debt outstanding was about $1.3 billion.

The downgrade reflects the higher degree of risk facing the
regional rural wireless carriers because of a number of factors,
including the adoption of the industry of wireless number
portability in November 2003, continued declines in roaming rates
received from the national carriers, and more aggressive
competition from the national players.

The rating on the company reflects high debt leverage and moderate
growth in overall revenue, offset somewhat by below industry
average churn of 1.8% and above average EBITDA margin in the mid-
40% area. In addition, recent roaming agreements to cover GSM
traffic mitigates near-term competitive threats of an extensive
network overbuild by these carriers in Rural Cellular's service
area.


SAFETY-KLEEN: Settles Claims Dispute with Dai-Ichi Kangyo Bank
--------------------------------------------------------------
After much time and litigation expense, the Safety-Kleen Debtors
and Mizuho Corporate Bank, Ltd., as successor-in-interest to Dai-
Ichi Kangyo Bank, present Judge Walsh with a simple stipulation
settling the dispute regarding an irrevocable letter of credit
amounting to $6,000,000, which DKB issued in favor of Laidlaw
Transportation, Inc., at Safety-Kleen's request.  The terms of the
settlement are:

       (1) DKB and the Safety-Kleen Debtors exchange mutual
           releases;

       (2) The Motion and Renewed Motion filed by DKB are
           withdrawn with prejudice and without costs; and

       (3) Upon the Court's approval of this settlement, DKB
           will be deemed to have an allowed, liquidated,
           unsecured proof of claim against the bankruptcy
           estate for $3,405,304, and all other proofs of
           claim by DKB are deemed superseded by the allowed
           claim in this settlement.

Judge Walsh quickly adds his signature to this settlement.
(Safety-Kleen Bankruptcy News, Issue No. 60; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


SALEM COMMS: S&P Keeping Watch on B+ Corporate Credit Rating
------------------------------------------------------------
Standard & Poor's Ratings Services placed its ratings on Salem
Communications Corp., including its 'B+' corporate credit rating,
on CreditWatch with negative implications due to a thinning
covenant cushion and modest liquidity.

Camarillo, Calif.-based radio operator Salem had approximately
$316.1 million of debt outstanding on March 31, 2003.

"The rating action recognizes that Salem's covenant cushion is
narrowing due to debt-financed acquisition activity, which
restrains cash flow in the short term, and financial covenants
that become more restrictive beginning Sept. 30, 2003," said
Standard & Poor's credit analyst Alyse Michaelson. Limited
liquidity, derived from borrowing capacity under existing credit
facilities, is expected to be used to fund already committed
acquisitions. Discretionary cash flow deficits, resulting from
high capital spending to re-format acquired stations and startup
losses at acquired stations, preclude debt repayment. Still, Salem
benefits from the relative cash flow stability afforded by its
block programming time sales, which helps shield its revenues from
lingering war-related softness in television advertising.

Standard & Poor's will assess Salem's prospects for boosting its
covenant cushion and liquidity, plans for expansion, and near-term
operating outlook in resolving the CreditWatch listing. If the
company is unable to accomplish these goals, the rating could
potentially be lowered one or more notches.


SIEBEL SYSTEMS: Initiates Restructuring Plan to Reduce Expenses
---------------------------------------------------------------
Siebel Systems, Inc. (Nasdaq:SEBL) (S&P, BB Corporate Credit and
B+ Subordinated Ratings), a leading provider of eBusiness
applications software, announced revenues and earnings for the
quarter ended June 30, 2003.

Revenues for the second quarter of 2003 were $333.3 million. Net
income was $9.8 million.

Revenues from license fees for the second quarter of 2003 were
$109.9 million. Revenues from maintenance, consulting, and other
services were $223.4 million.

The company's cash, cash equivalents, and short-term investments
were $2.3 billion at June 30, 2003, an increase of $80.9 million
from March 31, 2003. Days sales outstanding in accounts receivable
decreased to 58 days in the second quarter of 2003 versus 63 days
in the first quarter of 2003.

                     Quarterly Highlights

The following highlights were announced or occurred since Siebel
Systems' last earnings statement:

Siebel Systems Secures New Customers: The company concluded new
software licensing agreements with more than 140 new customers in
the second quarter, including 3M UK PLC; American Dental
Association; Amersham Plc; Banco de Chile; Berlex Laboratories,
Inc.; Binney & Smith, Inc.; Brinks Nederland B.V.; Britvic Soft
Drinks Ltd.; Chartered Benefit Services, Inc.; City & Guilds of
London Institute; debitel Danmark AS; Fuji Xerox (Hong Kong)
Limited; Hewlett-Packard Colombia Ltda.; Inveresk Clinical
Research Ltd.; Martindale-Hubbell; Motorola (China) Electronics
Limited; Novartis Pharma Canada, Inc.; Organon NV; Sandisk
Corporation; Shire Pharmaceutical Group PLC; Siemens Westinghouse
Power Corporation; Thomson Legal & Regulatory Applications, Inc.;
and T-Systems CSM GmbH.

Siebel Systems Secures Repeat Orders: In the second quarter, the
company concluded additional software licensing agreements with
more than 175 existing customers, including Airbus S.A.S.;
Bayerische Motoren Werke AG; Baxter Healthcare Corporation; Best
Software SB, Inc.; BMW Financial Services, NA LLC; Cesky Telecom
A.S.; ClientLogic B.V.; Credit Lyonnais Asset Management; General
Services Administration; Greenpoint Mortgage Funding, Inc.;
Guidant Corporation; Health Net, Inc.; Itron, Inc.; JPMorgan Chase
Bank; KPN Telecom GSE ZW; Monster Worldwide, Inc.; National
Australia Bank Limited; Network Appliance, Inc.; Novo Nordisk
Pharmaceuticals, Inc.; Otis; Pfizer, Inc; Philip Morris
International Management SA; Putnam Investments, Inc.; RAC
Motoring Services, Ltd.; Royal Caribbean Cruises, Ltd.; RWE
Systems AG; SimCorp A/S; SITA; SKF Data Service AB; Stream S.p.A.;
Telecom Italia Mobile S.p.A.; Telecom Italia S.p.A; The
Manufacturers Life Insurance Company; T-Mobile USA, Inc.; Trend
Micro, Inc.; Warner Brothers Entertainment, Inc.; Xerox
Corporation.; and XM Satellite Radio, Inc.

                    Customer Engagements

The company concluded new engagements with more than 140 new
customers and expanded engagements at more than 175 existing
customers, including the following:

Autodesk, a global leader in design software, selected Siebel
eBusiness Applications as its worldwide CRM software standard.
Autodesk will implement multiple Siebel applications as part of a
broad, company-wide initiative to enhance and expand customer and
partner relationship management. The first phase of this 4,000-
user deployment, using Siebel Partner Relationship Management,
will focus on applications for Autodesk employees managing orders
for complex digital design and content creation products and
services, followed by self-service and channel management
applications used by customers and partners to directly interact
with Autodesk. Subsequent phases will extend Siebel eBusiness
Applications to sales, marketing, and call center users, with
Siebel Analytics providing insight into customer behavior and
preferences to top executives and managers across the enterprise.
Two key factors in Autodesk's selection of Siebel CRM were its
intuitive user interface and the breadth of business
functionality.

BISYS(R), a premier provider of business process outsourcing
solutions for investment firms, insurance companies, and banks,
has purchased an additional 1,000 user licenses of Siebel Finance,
MidMarket Edition. BISYS, which had originally acquired close to
6,000 licenses as the basis for its Relationship Manager Suite, is
experiencing rapid client adoption -- more than 65 bank sales --
of this fully integrated front-office service, sales, and
marketing solution. Relationship Manager Suite, powered by Siebel
eBusiness Applications, enables BISYS' community and regional bank
clients to deliver a consistent customer experience while
supporting a broad portfolio of financial services across multiple
delivery channels. BISYS has also deployed Siebel Call Center
internally to optimize service and build lasting, profitable
relationships with its client banks.

BT expanded its global use of Siebel eBusiness Applications in the
second quarter, contributing to anticipated cost savings of more
than $200 million by 2004. In an implementation involving more
than 22,500 users, the retail division of one of the world's
leading communications companies is transforming itself into an
agile, customer-focused business. To serve its 21 million consumer
and business customers, BT is rationalizing up to 104 disparate
call centers and investing $179.4 million to create a network of
33 multifunctional, next-generation contact centers (31 in the UK
and 2 in India), powered by Siebel CRM applications. The
integrated customer understanding will enable BT Retail to provide
a consistent, fast, and accurate response to all 850 million
inbound customer inquiries received each year -- whether it is
through the Internet, the telephone, mobile devices, field sales,
or channel partners.

The Civil Aviation Safety Authority, the independent authority
responsible for the safety regulation of civil air operations in
Australia and the operation of Australian aircraft overseas, will
standardize on Siebel eGovernment applications across more than
500 users nationwide. CASA will deploy Siebel Service, Siebel PRM,
and Siebel Employee Relationship Management applications to manage
its extensive registries, which contain more than 100,000 aviation
registration records of aviation industry participants and
aircraft. With centralized and consistent information,
consolidated safety information, and automated workflow, CASA will
become more "participant-centric," supporting reporting
obligations to government authorities while more effectively
managing resources.

GE Medical Systems, a unit of General Electric Company and a $9
billion global leader in medical imaging, healthcare services, and
technology, is standardizing its global service operations on
Siebel Medical call center, contracts, and billing capabilities.
The new global service delivery platform will replace multiple
service applications and unify service information across multiple
departments and systems, giving GE Medical Systems the flexibility
to scale its service operations as the company expands its
business through future growth. The Siebel implementation will
provide a comprehensive repository used by GE Medical Systems'
service professionals worldwide to improve service productivity
and effectiveness, increase service revenues, and maximize
customer satisfaction.

        Siebel Systems Product and Technology Leadership

Siebel Systems Delivers Products and Services for Accelerated ROI;
Showcases Customer Success at European User Week: Joined by more
than 1,500 customers and partners, Siebel Systems showcased new
products and services for easier integration, rapid deployment,
and reduced total cost of ownership at its annual European User
Week in Cannes, France. The company unveiled Siebel 7.5.3, which
sets a new standard for accelerated time-to-value by delivering an
additional 17 percent cost savings in deploying and maintaining
Siebel eBusiness Applications. Siebel Systems also announced
packaged, fix-priced Rapid Deployment Offerings to help customers
gain maximum value and competitive advantage from their technology
investment. In addition, new Business Process Solution Sets help
map the most valuable business processes supported by Siebel
applications to customer needs as they implement Siebel
applications for accelerated ROI.

Siebel Systems and IBM Introduce Next-Generation CRM Bank Teller
Solution: Demonstrated at Siebel European User Week for the first
time, Siebel Branch Teller is designed to speed banking
transactions by giving tellers an expanded set of information and
tools in a highly intuitive interface, while incorporating
detailed customer insight and management functions and providing
full-featured transaction-processing capabilities. Developed in
close collaboration with IBM and based on IBM's WebSphere, the
solution reflects the evolving role of the retail bank teller as a
more informed and empowered customer service agent. Siebel Branch
Teller enables banks to gain critical capabilities that enable
tellers to improve customer loyalty and increase both branch and
customer profitability.

          Siebel Systems Receives Industry Accolades

Siebel Systems was broadly recognized as one of the world's
leading software companies in the second quarter of 2003:

-- Leading Analyst Research Confirms Siebel Systems' Commanding
Lead in CRM Market Share and Production Implementations: According
to the leading research and advisory firm Gartner, Inc., Siebel
Systems is the unrivaled leader in global CRM software
deployments. Gartner Dataquest estimates of new CRM software
license sales show Siebel Systems in the number one position.
Further, Gartner Dataquest estimates of buyers' intentions to
implement within 12 months of purchase show that Siebel Systems is
the leader with 28.1 percent market share, compared to the closest
competitor who has 5 percent. Additionally, a separate Gartner,
Inc. study indicates Siebel Systems' annual number of users
deployed is five to eight times larger than that of any
competitor. IDC, the premier global market intelligence and
advisory firm in the information technology and telecommunications
industries, also reports that Siebel Systems maintained its
dominant market position, with 17.1 percent of the worldwide CRM
applications software market in 2002, compared to the closest
competitor who has approximately 6 percent. In upcoming IDC
research on vendor market standings within marketing, sales, and
customer service software segments, IDC will indicate that Siebel
Systems outpaced competitors with the leading market share
worldwide in each segment.

-- Siebel Systems Named Worldwide Leader in Customer Analytic
Applications: In a May 2003 report, IDC recognized Siebel Systems
as the market share leader in the rapidly growing customer
analytic applications market. Siebel Systems captured 15.4 percent
($122.6 million) of the worldwide market for these applications in
2002, up from 5.5 percent share in 2001. IDC expects customer
analytics to be the fastest growing analytic applications market
over the next five years, increasing at a 12.9 percent compound
annual growth rate to more than $1.4 billion by 2007. IDC also
reports that Siebel Systems was the fastest growing major analytic
applications provider in the industry, with revenue growth of 230
percent in 2002.

-- Siebel Systems Earns Leadership Status in META Group Evaluation
of Channel Relationship Management: Siebel PRM received the
highest overall score for channel relationship management in META
Group's first annual METAspectrum(SM) vendor analysis for ChRM
application suites. Siebel Systems was the only vendor listed in
the Leader position and the only vendor to receive top ratings
from META Group for both channel and customer relationship
management.

-- Harvard Business School Alumni Association Honors Siebel
Systems with 2003 Entrepreneurial Company of the Year Award: HBSA
of Northern California awarded Siebel Systems as the 25th annual
Entrepreneurial Company of the Year to honor the company's
entrepreneurial roots, lasting presence, and exceptional
management through periods of rapid growth.

-- Northern California Ernst & Young Recognizes Thomas M. Siebel
as "Master Entrepreneur of the Year - 2003": Northern California
Ernst & Young honored Mr. Siebel as the recipient of its most
prestigious award of Master Entrepreneur for founding and managing
one of the most successful software companies in history. Ernst &
Young selects only one executive from among 35 Entrepreneur of the
Year award finalists from a wide variety of industries throughout
Northern California for this special recognition.

     Siebel Systems Restructures for Increased Profitability

Siebel Systems has initiated a restructuring plan that it expects
will enable the company to achieve a 15 percent operating margin
at roughly current revenue levels. Measures include a workforce
reduction of approximately 490 employees; consolidation or
elimination of certain facilities; reduction of depreciation
expenses through retirement of some assets; and migration of some
business operations offshore. The company expects to end the third
quarter with approximately 5,000 employees. The plan is expected
to achieve quarterly savings of nearly $30 million by the fourth
quarter of 2003 and nearly $40 million by the second half of 2004,
when the full effect of the reduced depreciation costs is
realized. The company expects to take a restructuring charge in
the third and fourth quarters of 2003.

Siebel Systems, Inc. is a leading provider of eBusiness
applications software, enabling corporations to sell to, market
to, and serve customers across multiple channels and lines of
business. With more than 3,500 customer deployments worldwide,
Siebel Systems provides organizations with a proven set of
industry-specific best practices, CRM applications, and business
processes, empowering them to consistently deliver superior
customer experiences and establish more profitable customer
relationships. Siebel Systems' sales and service facilities are
located in more than 28 countries.


SK GLOBAL AMERICA: Case Summary & 18 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: SK Global America, Inc.
        One Parker Plaza
        400 Kelbey Street
        Fort Lee, New Jersey 07024

Bankruptcy Case No.: 03-14625

Type of Business: SK Global America is a subsidiary of SK Global
                  Co., Ltd., one of the world's leading trading
                  companies.

Chapter 11 Petition Date: July 21, 2003

Court: Southern District of New York (Manhattan)

Judge: Cornelius Blackshear

Debtor's Counsel: Albert Togut, Esq.
                  Scott E. Ratner, Esq.
                  Togut, Segal & Segal LLP
                  One Penn Plaza
                  Suite 3335
                  New York, NY 10119
                  Tel: (212) 594-5000
                  Fax: (212) 967-4258

Total Assets: $3,268,611,000

Total Debts: $3,167,800,000

Debtor's 18 Largest Unsecured Creditors:

Entity                      Nature Of Claim       Claim Amount
------                      ---------------       ------------
Koram Bank (all branches)   Short term loan        $65,000,000

Koram Bank                  Short term loan        $50,000,000
39, Da-dong
Chung-gu
Seoul, Korea 100-180
Mr. Park Whan-Min
Tel: 82-2-3455-2136
Fax: 82-2-3455-2935

Koram Bank, London Branch   Short term loan        $15,000,000
Second Floor, 30-40
Eastcheap
London, EC3M 1HD
United Kingdom
Dong Hwun Song
Tel: 44-20-7283-1833
Fax: 44-20-7626-8828

Shinhan Bank, New York      Short term loan        $52,000,000
Branch
32nd Floor
800 3rd Avenue
New York, NY 10022
Suk-Jin Koh
Tel: 212-371-8000
Fax: 212-371-8875

Woori Bank (all branches)   Short term loan        $41,000,000

Woori Bank, New York        Short term loan        $29,000,000
Agency
245 Park Avenue, 41st Fl/
New York, NY 10167
Jeong Han Kim
Tel: 212-949-1900
Fax: 212-490-7146

Woori Bank, HongKong        Short term loan         $7,000,000
Branch
Suite 1401,
Two Pacific Place
88 Queensway, Hong Kong
Hong-Koo Kim
Tel: 85-2-2521-8016
Fax:82-2-2526-7458

Woori Bank, L.A. Agency     Short term loan         $5,000,000
3360 West Olympic Blvd.
Suite 300
Los Angeles, CA 90019
Kwi Hwa Jung
Tel: 213-620-0747
Fax: 213-627-5438

The Bank of New York        Short term loan        $40,000,000
One Wall Street
New York, NY 10286
John T. Murray
Tel: 212-635-7683
Fax: 213-635-8599

Kookmin Bank/New York       Short term loan        $35,000,000
Branch
565 Fifth Avenue, 24th Fl.
New York, NY 10017
Sei-Jun Park
Tel: 212-679-6100
Fax: 212-897-1456

Union Bank of California    Short term loan        $26,500,000
400 California Street
6th Floor
San Francisco, CA 94104
Young Ho Won
Tel: 415-765-2887
Fax: 415-765-2653

Korea Exchange Bank (all    Short term loan        $25,991,000
Branches)

Korea Exchange Bank,        Short term loan        $15,991,000
L.A. Agency
777 S. Figueroa St.,
Suite 3000
Los Angeles, CA 90017
Yong Koo Kim
Tel: 213-683-0830
Fax: 213-622-5378

Korea Exchange Bank,        Short term loan        $10,000,000
Chicago Branch
181 West Madison Street,
Suite 2100
Chicago, IL 60062
Tack Hyun Yun
Tel: 312-372-7890
Fax: 312-372-7839

The Korea Development Bank  Short term loan        $23,000,000
(all branches)

The Korea Dev't Bank/       Short term loan        $15,000,000
New York Branch
320 Park Avenue
32nd Floor
New York, NY 10022
Sung Ho Park
Tel: 212-688-7686
Fax: 212-421-5028

KDB Asia Limited            Short term loan         $5,000,000
Suite 2101-2103,
21st Floor
Two Exchange Square
8 Connaught Place
Central Hong Kong
Mr. Yong-II Kwon
Tel: 85-2-2525-1128
Fax: 85-2-2537-3989

Korea Dev't Bank, Ireland   Short term loan         $3,000,000
Russel House, Ground Floor
Stokes Ploace
St. Stephens Green
Dublin 2, Ireland
N.J. Seong
Tel: 353-1-4753-644
Fax: 353-1-4753-658

Societe Generale-New York,  Short term loan        $22,000,000
As Agent
1221 Avenue of the Americas
New York, NY 10020
Eric Wormser
Tel: 212-278-6078
Fax: 212-278-7723

Citibank N.A., Hong Kong    Short term loan        $20,000,000
Branch
48/F Citibank Tower,
Citibank Plaza
3 Garden Road, Central
Hong Kong
Adrienne Lam
Tel: 852-2868-8929
Fax: 852-2845-3415

Mizuho Corp. Bank, Ltd.     Short term loan         $20,000,000
1251 Avenue of the Americas
New York, NY 10020
Takashi Yano
Tel: 212-282-4947
Fax: 212-282-4383

The Export-Import Bank      Short term loan        $15,000,000
of Korea
16-3, Youido-dong
Yongdeungpo-ku, Seoul 150-996
Korea
Chang Ho Ha
Tel: 822-3779-6431
Fax: 822-3779-6749

Industrial and Commercial   Short term loan        $13,000,000
Bank of China (all
Branches)

Industrial and Commercial   Short term loan        $8,000,000
Bank of China-Seoul Branch
Taepyungro 2-Ka
Chung-Ku, Seoul 100-102
Korea

Industrial and Commercial   Short term loan        $5,000,000
Bank of China-Tokyo Branch
2-1 Maranouchi 1-Chome
Chiyoda-Ku, Tokyo 100-0005
Japan
Kong Xiannguo
Tel: 81-3-5223-2008
Fax: 81-2-5219-8502

Hana Bank, NY Agency        Short term loan        $11,000,000
West Bldg. (24th Floor)
280 Park Avenue
New York, NY 10017
Byouing-Ho Kim
Tel: 212-687-6160
Fax: 212-818-1721

Nat Exix Banques            Short term loan        $10,000,000
Popularies - Hong Kong
Branch
12th Floor, Citic Tower
1 Tim Mei Avenue
Central, Hong Kong
Johnson Chan
Tel: 852-2828-0916
Fax: 852-2583-9801

Credit Lyonnais-Seoul       Short term loan         $8,000,000
Branch
8-10th Floor
Youone Bldg. 75-95
Seosomundong, Chung-Ku,
Seoul
Byung Pil Kim
Tel: 82-2-772-8201
Fax: 82-2-772-8427

Oriental Fire & Marine      Short term loan         $5,000,000
Insurance Co, Ltd.
25-1, Youido-dong
Yeongdeungpo-gu, Seoul
Korea 150-878
Mr. Shin, Yong Nam
Tel: 82-2-3786-1412
Fax: 82-2-3786-1430/782

Cho Hung Bank, London       Short term loan         $3,000,000
Branch
1 Minster Court
Mincing Lane
London EC3R 7AA
UK
Kang Hee Lee
Tel: 44-20-7623-7791
Fax: 44-20-7648-1421


SPIEGEL GROUP: Wants Blessing to Hire Watson Wyatt as Consultant
----------------------------------------------------------------
In the context of their postpetition operations, The Spiegel
Debtors need a consultant for employee benefit matters.  In this
regard, the Debtors chose Watson Wyatt to provide employee
benefits consulting services.  According to James L. Garrity, Jr.,
Esq., at Shearman & Sterling LLP, in New York, Watson Wyatt is
particularly suited to provide benefits consulting services since
it has already provided expert witnesses and compensation program
development services to debtors in numerous cases.

Mr. Garrity relates that the Debtors have been working with Watson
Wyatt to prepare an incentive plan and performance incentive
program aimed at rewarding critical employees for achieving
results necessary to their emergence from Chapter 11 protection.
This incentive program will ultimately provide value to the
various interests of the Debtors' creditor constituencies.

By this application, the Debtors ask the Court for permission to
employ Watson Wyatt, nunc pro tunc to May 1, 2003.

Specifically, Watson Wyatt will:

    (a) make recommendations of retention, emergence and post-
        emergence compensation programs consistent with Spiegel's
        strategy and structure;

    (b) make a detailed report containing description and costing
        of the recommended plans;

    (c) hold meetings and maintain ongoing communications with
        Spiegel management, legal counsel and bankruptcy
        professionals on pay and related issues;

    (d) review prepetition contracts; and

    (e) assist with the determination of all administrative claims
        including contracts, deferred compensation, severance and
        change in control agreements.

As compensation for its services, Watson Wyatt will:

    (a) charge the Debtors a $65,000 fee, inclusive of
        administrative and technological services, for the
        preparation of reports;

    (b) charge the Debtors for its professional services on an
        hourly basis in accordance with its ordinary and customary
        rates effective on the date the services are rendered; and

    (c) seek reimbursement of actual and necessary out-of-pocket
        expenses.

The Watson Wyatt professionals who will primarily work for the
Debtors and their customary hourly rates are:

       Paul Platten        Senior Consultant            $645
       Alex Cedro          Consultant                    235
       Carol Parsons       Administrative Assistant      215
       Claire Wilson       Administrative Assistant      140

Pursuant to the terms and conditions of the firm's retention, if
any of the services do not conform to the requirements of their
engagement, the Debtors will notify Watson Wyatt and services
will be performed again at no additional charge or a portion of
the fees paid will be refunded.  If the re-performance of
services and refund of the applicable fees would not provide an
adequate remedy for damages arising from the breach of the
general terms of the engagement, Watson Wyatt's maximum total
liability will be limited direct damages in an amount not
exceeding $250,000 or, if greater, the fees payable with respect
to the particular engagement pursuant to which the liability
arises.  However, the Liability Cap does not apply to the extent
that any liability arises from Watson Wyatt's gross negligence or
willful misconduct or damage to any personal property.

Watson Wyatt Senior Consultant Paul Platten assures the Court
that the firm has no connection with the Debtors, their creditors,
the U.S. Trustee or any other interested party in the Chapter 11
cases.  Watson Wyatt also does not represent any interest adverse
to the Debtors and their estates in matters for which it will be
employed. (Spiegel Bankruptcy News, Issue No. 8; Bankruptcy
Creditors' Service, Inc., 609/392-0900)


SR TELECOM: Closes $4.5 Million Private Placement Transaction
-------------------------------------------------------------
SR Telecom(TM) Inc. (TSX: SRX) has closed its previously announced
private placement financing. The Corporation received gross
proceeds of $4,488,000, issuing 5,280,000 units at $0.85 per unit.
Each unit consists of one common share in the capital of SR
Telecom and one-half of one share purchase warrant (each whole
share purchase warrant upon exercise thereof will entitle the
holder thereof to acquire one common share in the capital of SR
Telecom at a price of $1.00 per share until July 18, 2008). The
securities will be subject to a four-month hold period under
applicable securities laws.

The distribution was marketed on a best efforts basis by way of a
brokered private placement with TD Securities Inc. and CIBC World
Markets Inc. acting as agents.

Net proceeds will be used for working capital.

At closing, SR Telecom has 60,946,415 common shares issued and
outstanding.

                          *   *   *

As reported, Standard & Poor's Ratings Services affirmed its 'B+'
long-term corporate credit and senior unsecured debt ratings on SR
Telecom Inc. At the same time, the outlook was revised to negative
from stable due to weak first-quarter results.

The ratings on SR Telecom reflect the company's strong position in
this market and the extent of its customer and geographic
diversity. This is offset by the company's limited near-term
financial flexibility, its reliance on the successful rollout of
its new products to restore profitability growth, and ongoing
exposure to emerging markets and prolonged economic weakness in
South America, which continues to negatively affect SR Telecom's
Chilean subsidiary.


TOWER AUTOMOTIVE: Working Capital Deficit Narrows to $82 Million
----------------------------------------------------------------
Tower Automotive, Inc. (NYSE:TWR) announced second quarter
revenues of $743 million, compared with $751 million in the second
quarter of 2002. The company reported a net loss of $2 million for
the quarter versus net income for the second quarter of 2002 of
$23 million.

For the six months ended June 30, 2003, revenues were $1.5
billion, compared with $1.4 billion in the 2002 period. Reported
net income for the six months ended June 30, 2003 was $9 million,
or $0.16 per diluted share. The company reported a net loss of
$124 million for the six months ended June 30, 2002.

"For the quarter, we converted well on higher than expected
sales," stated Dug Campbell, president and chief executive officer
of Tower Automotive. "We also generated $112 million of cash from
operations, which exceeded our capital spending of $58 million for
the quarter. Our recent debt restructuring has improved the
financial flexibility of our enterprise and our launch activity is
on track."

During the second quarter of 2003, the company completed a $258
million senior note offering and also amended its senior credit
facility, reducing the borrowing capacity but providing for less
stringent financial covenants in order to enhance overall
liquidity. The combination of the senior notes offering and
amended senior credit facility will also provide flexibility for
the company to redeem its $200 million convertible subordinated
notes.

At June 30, 2003, the company's balance sheet shows that its total
current liabilities outweighed its total current assets by about
$82 million.

The company previously announced that it is relocating the
production of high-volume frame assemblies for the Ford Ranger
currently performed at its Milwaukee facility to its Bellevue,
Ohio, business unit. The relocation of the Ranger production line
will be completed by June of 2004. Tower Automotive expects to
realize annual cash savings, primarily from reduced labor costs,
of approximately $10 million following full completion of the
move. During the second quarter of 2003 the company recorded a
$23.1 million pre-tax restructuring and asset impairment charge
($0.27 per share effect) comprised of cash charges of $2.8
million, pension and other post-retirement benefit plan
curtailment costs of $7.7 million and non-cash asset impairment
charges of $12.6 million related to restructuring activities.

Tower Automotive, Inc., is a global designer and producer of
structural components and assemblies used by every major
automotive original equipment manufacturer, including Ford,
DaimlerChrysler, GM, Honda, Toyota, Nissan, Fiat, Hyundai/Kia,
BMW, and Volkswagen Group. Products include body structures and
assemblies, lower vehicle frames and structures, chassis modules
and systems, and suspension components. The company is based in
Grand Rapids, Mich. Additional company information is available at
http://www.towerautomotive.com

As reported in Troubled Company Reporter's June 6, 2003 edition,
Standard & Poor's Ratings Services assigned its 'B' rating to new
$250 million senior notes due 2013 of R.J. Tower Corp., issued
under rule 144A with registration rights. At the same time
Standard & Poor's assigned its 'BB-' rating to the company's $240
million senior secured term loan. The debt issues will be
guaranteed by R.J. Tower's parent, Tower Automotive Inc. The 'BB-'
corporate credit rating on Tower was affirmed. The outlook is
stable.


UNITED AIRLINES: Turning Over Assets to Northern Trust Company
--------------------------------------------------------------
On October 4, 1989, UAL Corporation and National Bank of Detroit
entered into a Trust Agreement.  The Agreement created a trust
that held certain assets to fund the Debtors' retirement benefits
liabilities for certain former directors.  On June 15, 1997,
Northern Trust Company was appointed successor trustee to NBD.
According to James H.M. Sprayregen, Esq., at Kirkland & Ellis,
Section 3(a) of the Trust Agreement provides that in a UAL
bankruptcy, Northern Trust will dispose of any assets in the
Trust only as a "court of competent jurisdiction" may direct to
satisfy the claims of the Debtors' creditors.

The Debtors and Northern Trust have agreed that all assets in the
Trust will be remitted to the Debtors, minus application fees and
any outstanding expenses payable to Northern Trust.  The current
estimated value of assets in the Trust is $1,512,000.  In the
agreed Stipulation, Northern Trust will liquidate the Trust's
assets and deliver the proceeds to the Debtors, less $1,266 in
fees and expenses.  The parties have agreed to the terms, but
Court approval is required for Northern Trust to liquidate the
assets and remit the funds to the Debtors. (United Airlines
Bankruptcy News, Issue No. 23; Bankruptcy Creditors' Service,
Inc., 609/392-0900)


UPC POLSKA: Gets Court Nod to Hire Ordinary Course Professionals
----------------------------------------------------------------
UPC Polska, Inc., sought and obtained approval from the U.S.
Bankruptcy Court for the Southern District of New York to continue
employing the professionals it utilized in the ordinary course of
its business, without the submission of separate employment
applications and affidavits.

The Debtor will pay to each Ordinary Course Professional without
an application to the Court by such professional, 100% of fees and
disbursements incurred.  Such payments would be made following the
submission to and approval by the Debtor of appropriate invoices
setting forth in reasonable detail the nature of the services
rendered and disbursements actually incurred but not to exceed a
total of $30,000 per month or $250,000 in the aggregate in the
Debtor's Chapter 11 Case,

The Debtor desires to continue to employ the Ordinary Course
Professionals to render many of the services to its estate similar
to those services rendered prior to the Petition
Date. Prior to the Petition Date, the amount of aggregate annual
compensation paid by the Debtor to the Ordinary Course
Professionals on an annual basis was approximately $700,000.

These Ordinary Course Professionals render key services for the
Debtor that impact the Debtor's continuing business operations. It
is essential that the employment of the Ordinary Course
Professionals, many of whom are already familiar with the Debtor's
operations and business affairs, continue on an ongoing and
uninterrupted basis to avoid disruption of the Debtor's business
operations, as well as to ensure Debtor's compliance with state
and federal legal and regulatory requirements.

UPC Polska, Inc., headquartered in Denver, Colorado, is an
affiliate of United Pan-Europe Communications N.V.  The Debtors is
a holding company, which owns various direct and indirect
subsidiaries operating the largest cable television systems in
Poland. The Company filed for chapter 11 protection in July 7,
2003 (Bankr. S.D.N.Y. Case No. 03-14358).  Ali M.M. Mojdehi, Esq.,
and Ira A. Reid, Esq., at Baker & McKenzie represent the Debtor in
its restructuring efforts.  As of March 31, 2003, the Debtor
listed $704,000,000 in total assets and $940,000,000 in total
debts.


U.S. CAN CORP: Completes $125 Million 10-7/8% Debt Offering
-----------------------------------------------------------
U.S. Can Corporation's wholly owned Subsidiary, United States Can
Company, has completed the offering of $125 million of its 10-7/8%
senior secured notes due 2010. The notes are secured, on a second
priority basis, by substantially all of the collateral that
currently secures the Company's senior secured credit facility.

The second priority senior secured notes were offered in the
United States only to qualified institutional buyers pursuant to
Rule 144A under the Securities Act of 1933, as amended, and
outside the United States pursuant to Regulation S under the
Securities Act. The second priority senior secured notes have not
been registered under the Securities Act or any state securities
laws and therefore may not be offered or sold in the United States
absent registration or an applicable exemption from the
registration requirements of the Securities Act and any applicable
state securities laws.

The Company has also amended its senior secured credit facility,
as previously announced, to permit the offering of the second
priority senior secured notes and adjust certain financial
covenants, among other things. These amendments also permit, from
time to time and subject to certain conditions, the Company to
make borrowings under its revolving credit facility for
repurchases of a portion of its outstanding 12-3/8% senior
subordinated notes in open market or privately negotiated
purchases.

U.S. Can Corporation is a leading manufacturer of steel containers
for personal care, household, automotive, paint and industrial
products in the United States and Europe, as well as plastic
containers in the United States and food cans in Europe.

As reported in Troubled Company Reporter's July 15, 2003 edition,
Standard & Poor's Ratings Services assigned its CCC+ rating to
United States Can Co.'s new $125 million senior secured
second-priority notes due 2010.

At the same time, Standard & Poor's revised its outlook on U.S.
Can Corp. to stable from negative, reflecting the expected
improvement in the company's liquidity, financial covenant
compliance, and debt amortization schedule once the proposed note
issue is successfully completed.

Standard & Poor's also affirmed its B corporate credit rating on
Lombard, Illinois based U.S. Can Corp.  Total debt outstanding was
$546 million at March 31, 2003.


VANTAGEMED CORP: Appoints Ernie Chastain Vice President of Sales
----------------------------------------------------------------
VantageMed Corporation (OTC Bulletin Board: VMDC.OB), a leading
provider of healthcare information solutions, announced the
appointment of Ernie Chastain as the company's vice president of
sales.  Mr. Chastain joins VantageMed after most recently serving
as the Vice President of Sales of the Enterprise Division of
VitalWorks Inc.

Ernie Chastain has over 20 years of senior sales management
experience with high-profile healthcare information technology
companies such as Infocure/VitalWorks, Inc., Quality Systems,
Inc., Elcomp Systems Inc., and Versyss Corporation among others.
His experience includes building successful sales organizations,
and introducing new products to increase market share and
profitability. He received a BA in Marketing from the University
of Georgia.

"Ernie Chastain brings to VantageMed a wealth of senior sales
management expertise that will accelerate VantageMed's next phase
of growth," says Richard M. Brooks, Chairman and Chief Executive
Officer, VantageMed. " Ernie has an impressive history of success
in this marketplace, especially increasing revenue and expanding
market share.  His energy, intellect, and vision yield the perfect
combination to grow and lead our talented sales team."

VantageMed is a provider of healthcare information systems and
services distributed to more than 12,000 customer sites through a
national network of regional offices. Our suite of software
products and services automates administrative, financial,
clinical, and management functions for physicians, dentists, and
other healthcare providers and provider organizations.

VantageMed Corporation's December 31, 2002 balance sheet shows
that its total current liabilities exceeded its total current
assets by about $1.1 million. The Company also reported that its
total net capital is further depleted to about $3 million from
about $10 million recorded a year ago.


VICWEST CORP: Creditors' Meeting Scheduled to Convene on Aug. 1
---------------------------------------------------------------
As previously announced, Vicwest Corporation and certain of its
Canadian subsidiaries obtained an order on May 12, 2003 to begin
Vicwest's restructuring under the Companies' Creditors Arrangement
Act. Vicwest's protection under the CCAA has been extended until
August 12, 2003.

A meeting of affected creditors of Vicwest has been scheduled for
Friday, August 1, 2003 at 10:00 a.m. (Toronto time) in Room 205B,
Metro Toronto Convention Centre, 255 Front Street West (North
Building), Toronto, Ontario. The Meeting is being held to consider
and, if deemed advisable, to approve a plan of compromise and
reorganization proposed by Vicwest pursuant to the CCAA. Copies of
the Meeting materials that were mailed to affected creditors of
Vicwest are available on the Canadian securities regulators' Web
site -- http://www.sedar.com-- and on the Web site of Deloitte &
Touche Inc., monitor to Vicwest --
http://www.deloitte.com/ca/vicwest

The monitor has recommended that all affected creditors vote in
favor of the Plan.

As previously announced, the preparation and filing of Vicwest's
consolidated financial statements for the year ended December 31,
2002 and the quarter ended March 31, 2003 have been delayed as a
result of Vicwest's restructuring activities under the CCAA.
Vicwest anticipates that it will be able to comply with its
financial statement filing requirements after completion of its
restructuring process. At this time it is anticipated that Vicwest
will emerge from its restructuring process in August or September,
2003.

Vicwest, with corporate offices in Oakville, Ontario, is Canada's
leading manufacturer of metal roofing, siding and other metal
building products.


VIRYANET: March 31, 2003 Balance Sheet Upside-Down by $883,000
--------------------------------------------------------------
ViryaNet (NasdaqSC: VRYA), a leading provider of integrated mobile
and Web-based software applications for workforce management and
the automation of field service delivery, announced financial
results of its first fiscal quarter of 2003.

Total revenues were $2.0M for the first quarter, ended March 31,
2003, a 56% increase from $1.3M recorded for the fourth quarter of
2002, and a 52% decrease from $4.2M recorded in the first quarter
of 2002.

For the first quarter of 2003, the Company reported a net loss of
$1.4M, compared to a net loss of $4.3M for the fourth quarter of
2002, and compared to a net loss of $0.3M for the first quarter of
2002.

The Company reported gross margins of 42% for the first quarter of
2003, compared to 6% for the fourth quarter of 2002, and 67% for
the first quarter of 2002. The increase in gross margins from the
previous quarter was due to an increase in the volume of services
business, the absence of the one-time restructuring charges of the
previous quarter in the services business, and the contribution of
higher-margin license revenues.

Operating expenses for the first quarter of 2003 were $2.1M,
compared to $4.2M for the fourth quarter of 2002, and compared to
$3.1M for the first quarter of 2002. Excluding charges related to:
provisions for doubtful accounts; restructuring; in-process R&D
write-offs; or stock-based compensation, operating expenses for
the first quarter of 2003 were $2.1M compared to $2.7M for the
fourth quarter of 2002, and $2.6M for the first quarter of 2002.

During July 2003, the Company reached an agreement with its
primary lender, Bank Hapoalim of Israel, to restructure a portion
of its short-term loan arrangement for $3.45M. Under such
agreement, the bank has agreed to convert $2.4M of the short-term
loan into a long-term loan. The Company's balance sheet statements
as of December 31, 2002 and March 31, 2003 have been adjusted to
reflect such change in the loan structure.

The Company's cash position on March 31, 2003 was $2.6M, compared
to $3.2M at the end of the previous quarter. The operating cash
flow during the quarter improved to a cash burn of $0.8M compared
to a cash burn of $1.7M in the previous quarter. Excluding cash
outflows during the quarter related to Q4 2002 restructuring
activities, the Company's cash burn was $0.5M. Days of Sales
Outstanding for the quarter ended on March 31, 2003 was 58 days.

The Company's March 31, 2003 balance sheet shows a working capital
deficit of about $1.1 million, and a total shareholders' equity
deficit of about $883,000.

"We are beginning to realize the benefits of the restructuring we
accomplished in 2002 in operations, sales, distribution, and new
vertical markets," stated Win Burke, president and CEO, ViryaNet.
"Our revenues are beginning to grow as our new sales,
distribution, and marketing programs begin to produce results. As
a result of the cost reductions taken in 2002 as well as improved
revenues on improved business terms, our operational cash burn in
this quarter was reduced to approximately $0.5M. We anticipate
steady improvements going forward, and, for the second quarter of
2003, we expect to report revenues in the range of $2.6M to $2.8M,
and cash flow from operations to be slightly positive."

                         Q1 Activities

During the first quarter of 2003, the Company forged a strategic
partnership with GE Network Solutions, a business unit of GE Power
Systems, and an affiliate of GE Capital Equity Holdings, which is
the second largest shareholder of ViryaNet. The terms of the
agreement call for GE Network Solutions to act as a value added
reseller (VAR) of the ViryaNet products -- marketing, selling,
implementing, and supporting the ViryaNet Service Hub in the
utilities, oil & gas, and telecommunications markets worldwide.
The terms of the agreement included an initial purchase by GE
Network Solutions of ViryaNet software licenses.

In other reseller channel activities, Aspective, ViryaNet's
European partner, gained a new telecommunications customer, Orange
Telecommunications, using ViryaNet's software and sold additional
ViryaNet software user licenses to T-Mobile, another of its
telecommunications customers. ViryaNet also entered into an
agreement with Bitek, a product and systems integration company,
located in Korea, whereby Bitek markets, sells, and supports
ViryaNet Service Hub in multiple market sectors in southeast Asia.

The first quarter of 2003 also saw the rapid implementation of
ViryaNet Service Hub at Leslie's PoolMart, as well as the
completion of a major release upgrade at Symbol Technologies.

ViryaNet is a provider of software applications that improve the
quality and efficiency of an organization's service operations.
ViryaNet's flagship product -- the award-winning ViryaNet Service
Hub -- combines the power of the Internet, the freedom of wireless
technologies, and the resources of ViryaNet's deep service
expertise to help companies improve workforce scheduling,
dispatching, and activity reporting; customer contract and
entitlement automation; and asset, logistics, and depot repair
management.

Customers in the utility, telecommunications, grocery and retail,
high-technology manufacturing, HVAC, and other industries use
ViryaNet Service Hub to transition complex service business
processes into a manageable, scalable Internet operation, with the
goal of increasing service revenues, decreasing service costs, and
maximizing customer satisfaction.


WABASH NATIONAL: Preparing to Offer $100 Million Conv. Notes
------------------------------------------------------------
Wabash National Corporation (NYSE: WNC) intends to raise
approximately $100 million through an offering of five-year senior
unsecured notes that will be convertible into shares of Wabash's
common stock, subject to market and other conditions.  The
interest rate, conversion price and offering price are to be
determined by negotiations between Wabash and the initial
purchasers of the notes.  The Company may raise up to an
additional $25 million upon exercise of an option granted to the
initial purchasers in connection with the offering.

The Company expects to use the net proceeds of the offering to
repay outstanding indebtedness.

Wabash National Corporation designs, manufactures, and markets
standard and customized truck trailers under the Wabash(TM) brand
name.  The Company is one of the world's largest manufacturers of
truck trailers and a leading manufacturer of composite trailers.
The Company's wholly owned subsidiary, Wabash National Trailer
Centers, is one of the leading retail distributors of new and used
trailers and aftermarket parts throughout the U.S. and Canada.

Wabash National Corp.'s March 31, 2003 balance sheet shows that
its total current liabilities exceeded its total current assets
by about $205 million.

As reported in Troubled Company Reporter's April 16, 2003
edition, Wabash National completed the amendment of its credit
facilities, which includes its revolving line of credit, its
senior notes, its receivables facility and its lease facility.
The amendment revises certain of the Company's financial
covenants and adjusts downward the required monthly principal
payments during 2003.

In another previous report, the Company said it was not prepared
to predict that first quarter results, or any other future
periods, would achieve net income, and did not expect to announce
further results before the first quarter would be completed, given
the softness in demand and other factors.

The Company remains in a highly liquidity-constrained environment,
and even though its bank lenders have waived current covenant
defaults, there is no certainty that the Company will be able to
successfully negotiate modified financial covenants to enable it
to achieve compliance going forward, or that, even if it does, its
liquidity position will be materially more secure.


WABASH NATIONAL: June 30 Working Capital Deficit Tops $190 Mill.
----------------------------------------------------------------
Wabash National Corporation (NYSE: WNC) announced results for the
three and six month periods ended June 30, 2003. Net sales for the
second quarter were $230 million compared to $210 million for the
same period last year. Net loss for the second quarter was $27
million, including a $29 million non-cash charge related to
planned asset divestitures, compared to a net loss of $22 million
for the same period last year. Diluted loss per share was $1.05
for the quarter, including a $1.09 per share charge related to
planned asset divestitures, compared to a loss of $0.96 per share
for the 2002 quarter. For the six months ended June 30, 2003, net
sales were $453 million and a net loss of $26 million, including
the $29 million charge, compared to net sales of $372 million and
a net loss of $36 million for the same period last year. Diluted
loss per share for the six months ended June 30, 2003 and 2002 was
$1.02, including the $1.09 per share charge, and $1.61,
respectively.

At June 30, 2003, Wabash National's June 30, 2003 balance sheet
shows that its total current liabilities eclipsed its total
current assets by about $190 million, while its net capital had
further dwindled to about $49 million.

Commenting on the quarter, William P. Greubel, President and Chief
Executive Officer, stated, "The fundamental changes currently
taking place within the Company could prove to be a watershed
period as we move to structurally improve the Company, both
operationally and financially. The following are just some of the
significant highlights from the quarter:

    * Sales increased 3% from the 2003 first quarter on the
      continuing improvement in demand for new trailers while
      operating income, before the $29 million charge, improved
      48% over first quarter 2003 levels. We are indeed becoming
      earnings focused as opposed to share focused. We
      successfully started up two new production lines during the
      quarter, one line for our new Wabash FreightPro sheet and
      post trailer and one line for DuraPlate(R) containers. We
      believe trailer industry demand will continue to improve
      over the next several quarters. Our demand continues to be
      affected by our large customers managing their equipment
      capacity very closely;

    * We are in the final planning stages of reorganizing our
      channels of sales and distribution which will allow us to
      improve our opportunities to exploit our product and service
      offerings in the mid to large sized fleet segments of the
      trailer industry while maintaining our strategic
      relationships with the premier trucking companies in the
      U.S.;

    * As announced, we have signed a definitive agreement to sell
      substantially all of the assets of our leasing and rental
      business and our aftermarket parts business. Total
      consideration from the sale of these assets and the retained
      assets is approximately $65-$70 million of which $55 million
      will be paid in cash upon closing. We expect the transaction
      to close in the third quarter and is subject to lender
      approval and buyer financing. As noted above, we recorded an
      impairment charge of $29 million in the quarter to recognize
      the planned disposal of these assets at less than book
      value. This non-cash charge will not affect the Company's
      compliance under its existing bank covenants. Upon closing
      this transaction, all proceeds from this divestiture will go
      toward debt retirement which, including this amount, will
      total approximately $90 million year-to-date;

    * We also announced the selection of Fleet Capital to lead and
      fully underwrite a new $250 million syndicated bank
      financing for the Company. The new financing, which is
      subject to Fleet Bank credit approval and Wabash board
      approval, will be a three year asset based revolver and
      term loan that will be used to replace existing indebtedness
      and will substantially lower our cost of debt. Closing on
      the transaction is expected to occur during the third
      quarter of this year. Successfully refinancing our existing
      debt will result in charges of approximately $24 million,
      including prepayment penalties of approximately $20 million
      and a non-cash charge of approximately $4 million for the
      write-off of previously deferred debt costs, which will be
      recognized when the financing is completed. These charges
      will not affect the Company's compliance under its existing
      bank covenants; and

    * We are in the process of evaluating what we believe will be
      the final piece to our new capital structure, which will
      mark the culmination of two years of work to turn the
      Company around and to secure its future.

We continue to meet or exceed our objectives. We have active and
sound management leading our turnaround. Associate involvement has
been excellent. Our capital structure will soon be very solid. We
intend to focus our free cash flow in the future on continuing to
pay down debt. We shall augment our profitability by focusing our
products and services on the entire van market going forward. As
the trailer industry improves, we have positioned ourselves to
take full advantage of the recovery."

Wabash National Corporation designs, manufactures, and markets
standard and customized truck trailers under the Wabash(TM) brand
name. The Company is one of the world's largest manufacturers of
truck trailers and a leading manufacturer of composite trailers.
The Company's wholly owned subsidiary, Wabash National Trailer
Centers, is one of the leading retail distributors of new and used
trailers and aftermarket parts throughout the U.S. and Canada.


WEIRTON STEEL: Obtains Nod to Implement Temporary Layoff Program
----------------------------------------------------------------
As of June 1, 2003, Weirton Steel Corporation employed
approximately 516 salaried employees, who were not represented by
any collective bargaining unit.  The Debtor has determined that it
is imperative to implement a temporary layoff in excess of 50
individuals or approximately 10% of its Salaried Employees.  Some
or all of the Salaried Employees affected by the Temporary Layoff
Program may be subject to future employment cost reduction
programs, or they may ultimately be called back to work.

According to Mark E. Freedlander, Esq., at McGuireWoods LLP, in
Pittsburgh, Pennsylvania, the proposed Temporary Layoff Program
consists of four phases:

    Phase 1: Identifying job functions that can be temporarily
             curtailed, reduced or replicated by other job
             functions.

    Phase 2: Grouping non-represented employees who perform the
             job functions identified in Phase 1 or who perform
             similar job functions requiring similar skills and
             knowledge.

    Phase 3: Soliciting employees within affected groups to
             volunteer to be temporarily laid off.

    Phase 4: Achieving the necessary number of layoffs not met by
             volunteers by involuntary temporary layoffs within
             affected groups by pension service time(seniority).

Mr. Freedlander assures the Court that the Temporary Layoff
Program was designed without unlawful consideration of race, sex,
age, religion, national origin, veteran status, and qualified
disability status as factors in determining impacted jobs.

Those Salaried Employees subject to the Temporary Layoff Program,
either voluntarily or involuntarily, will be requested to execute
a Waiver and Release, Mr. Freedlander says.  After executing the
Waiver and Release, the affected Salaried Employees will receive
the Enhanced Layoff Benefits, namely:

    (a) Sixty percent of weekly base salary less $351 per week,
        less applicable federal and state payroll taxes and
        withholding for the first to occur of a period of 22 full
        calendar weeks or until the layoff ends;

    (b) Healthcare coverage at Weirton's cost, including the same
        coverages as are provided under COBRA continuation
        coverage for the employee, spouse and eligible
        dependents for exempt Salaried Employees, not subject to
        change with respect to employee premium contributions
        only, for the first to occur of a period of five full
        calendar months or the period of layoff ends; and

    (c) Life insurance coverage consisting of the basic group term
        life insurance for the employee and dependents and the
        supplemental group term life insurance coverage, as
        provided by Weirton for exempt Salaried Employees, with
        basic group term life to be paid by Weirton and
        supplemental group term life to be shared by Weirton and
        the Salaried Employee for the first to occur of a period
        of five full calendar months or the period of the layoff
        ends.

On the other hand, for those impacted Salaried Employees who
refuse to execute a Waiver and Release, the Debtor will provide
the Basic Lay-off Benefits, namely:

    (a) Lay-off Payments for a period of four calendar weeks or
        until the layoff period ends, whichever comes first;

    (b) Health coverage of three full calendar months or until the
        period of layoff ends, whichever comes first; and

    (c) Life Insurance of three full calendar months or until the
        layoff period ends, whichever comes first.

In addition to Layoff Benefits, in accordance with the West
Virginia Wage Payment Collection Act, impacted Salaried Employees
will be paid for unused vacation time on the next regular pay
after the lay-off.

Mr. Freedlander asserts that the proposed Layoff Benefits is
fair, reasonable and non-discriminatory layoff program.  Still,
the Debtor expects that some impacted Salaried Employees may
refuse to execute the Waiver and Release, and may, in fact, seek
legal redress against the Debtor's senior management.  Thus, the
Debtor seeks the Court's authority to establish an Indemnity
Reserve against availability under its postpetition revolving
credit facility in an amount not to exceed $3,000,000, until a
reorganization plan is confirmed, for the benefit of the Debtor's
senior management and employees in formulating and implementing
the Temporary Layoff Program.

Mr. Freedlander informs Judge Friend that Debtor's aggregate
liability for the proposed salary continuation payments and
benefits to the impacted Salaried Employees will be no less than
$350,000 and is not expected to exceed $750,000 assuming that all
impacted Salaried Employees will execute the Waiver and Release
and receive the Enhanced Layoff Benefits.  Layoff Benefits will
be entitled to administrative priority claim status in accordance
with Section 503(b)(1)(A) of the Bankruptcy Code.

Mr. Freedlander maintains that the amounts to be paid under the
Temporary Layoff Program are amply supported by the Debtor's
sound judgment.  Moreover, the Temporary Layoff Program will
allow the Debtor to continue to operate its business with minimal
disruption and proceed with the important task of stabilizing its
operations.

Accordingly, the Debtor asks the Court to:

    (a) approve the Temporary Layoff Program;

    (b) authorize the payment of the Layoff Benefits and afford
        the Layoff Benefits administrative priority claim status
        in accordance with Section 503(b);

    (c) authorize it to pay all reasonable costs of defense and
        otherwise hold harmless and indemnify management from all
        claims of impacted Salaried Employees that arise from or
        relate to the Temporary Layoff Program and establish the
        Indemnity Reserve; and

    (d) exercise jurisdiction over any claims that arise from or
        relate to the Temporary Lay-off Program.

              Independent Steelworkers Union Responds

Richard A. Pollard, Esq., at Pietragallo, Bosick & Gordon, in
Pittsburgh, Pennsylvania, points out that the Debtors' request
would have substantial impact on the Debtor's finances and on the
availability, for business operations, of funds from the DIP
financing.  Mr. Pollard argues that:

    (a) The Temporary Layoff Program cannot have been conceived at
        the last minute or in response to an unanticipated
        emergency, so as to justify requiring parties-in-interest
        to review and respond to the motion over the limited time
        span.  To the contrary, the request itself recites that
        the program was based on the Debtor's "extensive review of
        its Salaried Employees" and also refers to the "care
        undertaken by senior management to formulate and implement
        a fair, reasonable and non-discriminatory layoff program;"

    (b) The request fails to explain or justify the need for
        relief on an emergency basis.  Indeed, the request avers
        that "[t]he Temporary Layoff Program provides impacted
        Salaried Employees a 45-day period in which to determine
        whether to execute the waiver and Release", so it does
        not appear that the anticipated implementation of the
        program or the realization of cost savings from the
        program would occur immediately;

    (c) The Debtor did not justify its failure to discuss the
        substance of the request with all interested
        constituencies prior to its filing on an emergency basis.
        The Union cannot speak to the existence of advance
        discussions with other constituencies, but the request
        avers none, and except for a comment that a motion about
        the proposed layoffs might be filed, no advance
        discussions with the Union have occurred; and

    (e) The Debtor seeks to determine the procedural and
        substantive rights of the affected employees without
        identifying them and affording to them an opportunity to
        object if they should believe an objection appropriate.

To the extent that the Debtor's request seeks to assure authority
for payment of the proposed benefits as administrative expenses,
Mr. Pollard informs Judge Friend that the Union has no objection
per se.  However, to the extent that administrative expense
status would be extended any further or to any other claims, the
Union believes that the determination of the nature of, and
extent of, and prospect of, is extraordinary and should not be
resolved on an emergency basis.

The Union further objects to specific aspects of the Debtors'
request for reasons that include, without limitation:

    (a) Those Salaried Employees who do not execute a Waiver and
        Release would receive substantially lesser benefits than
        those Salaried Employees who do.  If, and to the extent
        that the layoffs occur in the ordinary course of the
        Debtor's business and represent ordinary decisions in
        these circumstances, it is in no way clear why the Debtor
        seeks to pay heavily for the Waiver and Release or
        penalize those who do not sign it;

    (b) Although the request expresses concern for potential
        litigation by affected Salaried Employees, it provides no
        basis for any conclusion that any substantial or viable
        claims are likely to arise from the implementation of the
        Temporary Layoff Program.  To the contrary, Mr. Pollard
        notes, the request specifically avers that "the Debtor
        did not have a formal severance or layoff program or
        policies with respect to the Salaried Employees,"
        indicating that the Temporary Layoff Program would not
        violate the terms of any prepetition contractual rights
        with any affected salaried employees;

    (c) The increased payments to those employees executing
        waivers and the proposed establishment of an Indemnity
        Reserve under the Debtor's postpetition facility, Mr.
        Pollard points out, appears calculated solely to benefit
        non-debtor entities, to the potential detriment of the
        Debtor's access to needed working capital under its
        postpetition financing;

    (d) It is extraordinary that, in undertaking this carefully
        considered Temporary Layoff Program, $3,000,000 of the
        precious postpetition revolving credit facility
        would be consumed as an "indemnity reserve" and on an
        emergency basis.  Mr. Pollard reminds Judge Friend that
        the postpetition revolving credit facility was approved
        by the Court to provide the Debtor with badly needed
        working capital, rather than as an insurance policy for or
        carve-out "for the benefit of senior management and
        employees of Weirton";

    (e) To the best of the Union's knowledge, the Debtor maintains
        directors and officers liability insurance, and that
        insurance should adequately protect senior management and
        employees in these circumstances.  It is not clear why
        extraordinary protection for senior management employees
        is required, on an emergency basis or otherwise;

    (f) The request fails to take into account the availability
        of potentially less costly means of obtaining protection
        from potential litigation by affected salaried employees,
        like giving them notice and an opportunity to object
        before the Court to the terms of the proposed Temporary
        Layoff Program, so as to subject the employees to the
        defense of res judicata or collateral estoppel with
        respect to any objections they may later seek to assert;
        and

    (g) The proposed savings level resulting from the Temporary
        Layoff Program is not clear from the request and may well
        not exceed the consumed working capital involved based
        upon reduced availability under the postpetition revolving
        credit facility.

Therefore, the Independent Steelworkers Union asks the Court to
deny the Debtors' emergency request.

                           *     *     *

Judge Friend concurs with the Debtors that the Temporary Lay-off
Program:

    -- has been designed in a good faith non-discriminatory
       manner,

    -- is a sound exercise of the Debtor's business judgment,

    -- constitutes a legitimate business purpose, and

    -- was job-related and consistent with business necessity.

Accordingly, Judge Friend approves the Temporary Layoff Program
and authorizes and empowers, but does not direct, the Debtor to
pay the Lay-off Benefits.

The Court further permits the Debtor to pay all reasonable costs
of defense of and otherwise hold harmless all members of the
Debtors' management or employees in respect of any claims of any
impacted Salaried Employees arising from or relating to the
development and implementation of the Temporary Layoff Program.
Subject to further Court order, the Debtor is authorized to
establish an indemnity reserve in an amount to be determined at a
subsequent hearing before the Court. (Weirton Bankruptcy News,
Issue No. 6; Bankruptcy Creditors' Service, Inc., 609/392-0900)


WESTPOINT STEVENS: Wants Utility Cos. Deemed Adequately Assured
---------------------------------------------------------------
John J. Rapisardi, Esq., at Weil Gotshal & Manges LLP, in New
York, tells the Court that in connection with the operation of
their business and management of their properties, WestPoint
Stevens Inc., and its debtor-affiliates obtain electricity,
natural gas, telephone, water, trash collection, communications
and other similar services from various utility companies.
Generally, the Debtors have an excellent payment history with
respect to their utility services and there are few, if any,
defaults or arrearages with respect to their undisputed utility
service invoices, other than the payment interruptions that might
have been caused by the commencement of these Chapter 11 cases.

The Debtors' businesses require that the utility services continue
uninterrupted.  Any interruption in essential services will cause
irreparable harm to the Debtors' ability to conduct their business
in an orderly and efficient manner.

By this motion, the Debtors ask the Court to determine that the
Utility Companies are adequately assured of future payment
pursuant to these payment assurance measures:

    A. Any undisputed charge for Utility Services furnished by a
       Utility Company to the Debtors after the Petition Date will
       constitute an administrative expense of the Debtors'
       Chapter 11 cases in accordance with Sections 503(b) and
       507(a)(1) of the Bankruptcy Code.

    B. The Debtors will file monthly operating statements with the
       Court on the ECF System and deliver a copy of same to the
       United States Trustee for the Southern District of New York
       and each of the Requesting Utilities.

    C. In the event of a material adverse change to the Debtors'
       liquidity position, as indicated on the monthly operating
       statements, any Requesting Utility may ask the Court to
       find that it no longer has adequate assurance of payment
       for future services.

    D. With respect to the Requesting Utilities, notwithstanding
       any longer time authorized under the applicable tariffs,
       the Debtors' time to pay their monthly bills in respect of
       Utility Services will be fixed at the greater of:

       1. the number of days allowed under each such Requesting
          Utility's ordinary course billing cycle in effect prior
          to the Petition Date, with any disputes as to the cycle
          to be resolved by this Court, or

       2. the last business day in the 14 calendar days following
          receipt of the postpetition invoice by the Debtors.

    E. In the event of a postpetition payment default by the
       Debtors, the Requesting Utility may fax a notice to the
       Debtors demanding payment, and if the Debtors fail to make
       payment within five business days of receipt of notice, the
       Requesting Utility may move the Court, on an expedited
       basis, for leave to terminate Utility Services.

Mr. Rapisardi points out that the Debtors have an excellent
payment history with the Requesting Utilities and there had been
few or no defaults or arrearages with respect to the payment of
undisputed Utility Service invoices.  It is well established, at
least in the Second Circuit, that absent significant prepetition
payment defaults, a debtor's agreement to pay postpetition
services of its utilities as administrative expenses constitutes
"adequate assurance" of its future performance within the meaning
of Section 366.

Mr. Rapisardi adds that adequate assurance also exists in these
cases by reason of the Debtors' excellent prepetition payment
history as well as their present and projected future liquidity
position.  As of June 25, 2003, the Debtors had $209,100,000 in
unused borrowing capacity under their $300,000,000 debtor-in-
possession financing facility.  Based on this borrowing capacity
and cash balances, the Debtors' current liquidity is at least
$209,300,000.  Also, the Debtors' financial projections indicate
that they will maintain adequate liquidity to pursue strategic
restructuring and reorganization alternatives throughout 2003.
Based on the restructuring proposal with their major creditor
constituents, including the bondholders, the Debtors anticipate
they will be able to successfully emerge from Chapter 11 by the
end of 2003 or early 2004.  The Debtors submit that they have
more than sufficient available funds with which to pay all
undisputed postpetition utility charges and other administrative
expenses.

Moreover, Mr. Rapisardi contends that the proposed Payment
Safeguards provide substantial adequate assurance of payment to
the Requesting Utilities.  Specifically, the Debtors' monthly
operating statements to be filed with the Court will enable the
Requesting Utilities to closely monitor the Debtors' liquidity
position.  If there is any material adverse change in liquidity,
the Requesting Utilities may petition the Court to require the
Debtors to provide additional assurance in the form of a deposit
or other security.  Also, in the event the Debtors default in
payment of a postpetition utility bill, the Payment Safeguards
provide an expedited procedure to obtain a hearing before the
Court for leave to terminate Utility Services. (WestPoint
Bankruptcy News, Issue No. 5; Bankruptcy Creditors' Service, Inc.,
609/392-0900)


WINSTAR: Winstar Holdings Asks Court to Hold Network in Contempt
----------------------------------------------------------------
Winstar Holdings, LLC asks the Court to find Network
Communications of Indiana, Inc. in civil contempt for violating
the December 19, 2001 order approving the sale of substantially
all assets of Winstar Communications, Inc. and its related debtor
entities by commencing an action seeking damages from Winstar
Holdings, IDT Corporation and Winstar Communications, LLC under a
complaint currently pending in the United States District Court
for the Southern District of Indiana, concerning property of the
estate which was purchased by Winstar Holdings pursuant to the
Sale Order.

William K. Harrington, Esq., at Duane Morris LLP, in Wilmington,
Delaware, recounts that on April 15, 2003, an action was
commenced against Winstar Holdings, IDT and Winstar Communications
in the Superior Court of Marion County, State of Indiana.  That
state court action alleged claims for trade secret
misappropriation, conversion, unfair competition and "tortious
interference" with contractual relations based on the alleged
misappropriation of a "customer list".  On May 2, 2003, the
Defendants removed the state court action related to the
Complaint to the Removal Court on the grounds of diversity
jurisdiction.

Network Communications' complaint alleges an interest in assets,
which were purchased pursuant to the Sale Order.  Specifically,
the Asset Purchase Agreement provided for the Debtors to sell,
assign, convey, transfer and deliver to the purchasers, free and
clear of all encumbrances, all of the rights, title and interest
in the Purchased Assets.  The Purchased Assets were defined to
include all rights, title and interest of the Debtors in, to and
under "all historical information relating to accounts of the
customers of the Business which, at the Closing Date, are users
of any of the services provided by the Sellers in the operation
of the Business . . ."  Paragraph 9 of the Sale Order further
states that a claimant is "forever barred, estopped, and
permanently enjoined from asserting against the Holdings, the
Buyer, any interest arising under or out of, in connection with,
or in any way relating to . . . the Debtors' businesses prior to
the Closing Date of the Sale of the Purchased Assets."

Mr. Harrington contends that despite full knowledge of the Sale
Order and its provisions, Network Communications has refused to
dismiss the Complaint that is specifically barred by the Sale
Order.  In addition, Network Communications has willfully ignored
the exclusive jurisdiction of the Bankruptcy Court with regard to
the interpretation of the Asset Purchase Agreement. Specifically,
the Sale Order states, "this Court retains and shall have
exclusive jurisdiction to endorse and implement the terms and
provisions of the Asset Purchase Agreement . . . in all respects,
including, but not limited to, retaining jurisdiction to . . .
interpret, implement, and enforce the provisions of the Asset
Purchase Agreement and this Sale Order."  Thus, to the extent
Network Communications could even allege claims of ownership of
the "customer list", the Complaint should have been properly filed
with the Bankruptcy Court and not in the Indiana state court.

The Bankruptcy Court, as a court of equity with jurisdiction over
the terms and provisions of the Sale Order, can protect its
jurisdiction by issuing an injunction barring Network
Communications from further violations of the Sale Order. Section
105(a) of the Bankruptcy Code empowers this Court to exercise its
equitable powers where "necessary" or "appropriate" to facilitate
the implementation of other Bankruptcy Code provisions.

Mr. Harrington affirms that Network Communications' action against
the Defendants has caused and will continue to cause additional
costs to Winstar Holdings if allowed to proceed.  It is clear that
the Sale Order has been validly in effect since its entry on
December 19, 2001.  Network Communications has arguably had
knowledge of the Sale Order since its entry, and has had actual
knowledge since at least June 4, 2003 when a further notice, which
included a copy of the Sale Order, was forwarded to its counsel.
Despite this knowledge, Network Communications continues to pursue
its action in Removal Court in violation of the Sale Order.

Accordingly, Winstar Holdings seeks a remedial order holding
Network Communications in civil contempt for its willful and
deliberate violation of the Sale Order, and for its attempted
abuse of the bankruptcy process.  The Court should impose a
coercive monetary fine on Network Communications, which will
continue from day to day and be compounded until the time as
Network Communications has fully remedied the damage caused.  The
order should also provide that Network Communications may only
purge itself of this finding of civil contempt by immediately
withdrawing or the Complaint so that it no longer violates the
terms and provisions of the Sale Order.  The effect of this order
will be to re-impose the status quo as to the effect of the Sale
Order, Winstar Holdings' rights and the Debtors' automatic stay.
(Winstar Bankruptcy News, Issue No. 45; Bankruptcy Creditors'
Service, Inc., 609/392-0900)


WORLDCOM: NLPC Lauds Hatch Hearing Probing Bankruptcy Proceeding
----------------------------------------------------------------
The National Legal and Policy Center (NLPC) thanked Senator Orrin
Hatch (R-UT), Chairman of the Senate Judiciary Committee, for
holding a hearing to investigate the implications of
MCI/WorldCom's bankruptcy proceeding.

Even though MCI/WorldCom stands to have approximately $35 billion
of debt wiped away from its books, it is still pursuing tax
benefits from its net operating losses that could potentially
allow the company to avoid paying income tax for the foreseeable
future. This loophole was exposed in a May 12, 2003 commentary in
BusinessWeek. Senators Rick Santorum (R-PA) and Kent Conrad (D-ND)
in the Senate and House Members Jim McCrery (R-LA), Robert Matsui
(D-CA) and Scott McGinnis (R-CO) have introduced legislation to
close this loophole. They join numerous other Members of Congress
including Senator Susan Collins (R-ME) and Congressman John
Sweeney (R-NY) who have criticized several aspects of the
MCI/WorldCom situation including the fact that the federal
government continues to award contracts to the company.

NLPC Chairman Ken Boehm stated, "While there are very real
concerns about what effect the emergence of MCI/WorldCom from
bankruptcy means for the telecommunications industry at large,
what is particularly upsetting is that the benefits the company is
receiving from this process don't seem to be to be enough for it.
At some point MCI/WorldCom's overreaching for continued benefits
from the federal government has got to be addressed. Our hope is
that the remedies being explored will ultimately result in not
just more talk, but in real action."

Based in Falls Church, Virginia, the NLPC promotes ethics,
openness and accountability in government through research,
education and legal action. NLPC distributes the Code of Ethics
for Government.


WORLDCOM INC: CAGW Applauds Hearing to Question MCI's Bankruptcy
----------------------------------------------------------------
Citizens Against Government Waste (CAGW) praised Senate Judiciary
Committee Chairman Orrin Hatch (R-Utah) for his leadership in
investigating MCI's bankruptcy proceedings and its effect on
competition within the telecommunications industry. At a hearing
Tuesday afternoon, Chairman Hatch heard testimony on the issue
from industry experts, including Bankruptcy Examiner and former
U.S. Attorney General Richard Thornburgh, who earlier this year
authored a report on MCI's bankruptcy.

"We commend Chairman Hatch for taking a closer look at whether MCI
could emerge from bankruptcy with an unfair advantage that would
threaten the financial stability of the entire telecommunications
industry," CAGW President Tom Schatz said. "If MCI was allowed to
compete unbridled of its debt, it could force prices across the
industry to nosedive. As telecommunications is one of the largest
sectors of the American economy, such an occurrence could lead to
a huge government bailout, costing taxpayers tens of billions of
dollars." Chairman Hatch is the latest member of Congress to
become involved in MCI's bankruptcy. Senate Governmental Affairs
Committee Chairman Susan Collins (R- Maine) has launched an
investigation into why the federal government continues to grant
contracts to the company despite its fraudulent history. Sen. Rick
Santorum (R-Pa.) has offered legislation that would close a
loophole in federal tax law that has allowed bankrupt companies to
continue to receive tax benefits from their net operating losses
despite having their corporate debt dramatically reduced during
the bankruptcy process. In the House, Rep. John Sweeney (R-N.Y.)
is supporting an amendment to be offered to the fiscal 2004
Transportation Appropriations Act that would suspend MCI from
federal contracts for the year.

"Despite the valiant efforts of several members of Congress, the
federal government continues to do business with a fraudulent
company, MCI, jeopardizing tax dollars," Schatz continued. "This
past week, the House of Representatives itself extended a contract
with MCI worth $17 million. This adds to the more than $1.2
billion the company has received in government contracts since
declaring bankruptcy, which is approximately 60 percent greater
than the $750 million fine MCI will pay in its settlement with the
Securities and Exchange Commission."

CAGW has been calling for MCI's debarment from government
contracts since November, 2002, on the basis that such agreements
unnecessarily put taxpayer dollars at risk, and amount to a hidden
government bailout of the company. Continuing its ad campaign,
"Crime Doesn't Pay," from last month, CAGW has been running ads
over the course of the last week in Congress Daily, The Hill, Roll
Call, The Washington Times, and The Weekly Standard.

"When Enron and Arthur Andersen committed similar fraud, they were
debarred. The question remains, why is the government allowing
this double standard to continue?" Schatz concluded. "More than a
year has passed since MCI has declared bankruptcy. It is time to
protect taxpayers from being the latest victims of MCI's fraud."

Citizens Against Government Waste is a nonpartisan, nonprofit
organization dedicated to eliminating waste, fraud, mismanagement
and abuse in government.


WORLDCOM INC: Intends to Assume Two Amended Fionda Agreements
-------------------------------------------------------------
Marcia L. Goldstein, Esq., at Weil Gotshal & Manges LLP, in New
York, recounts that on November 21, 1996, Fionda, LLC and Debtor
TTI National, Inc. entered into a representation agreement.  In
addition, on May 24, 1999, Fionda and MCI WorldCom Communications,
Inc., the successor-in-interest to WorldCom Technologies, Inc.,
entered into an association program agreement, which was
subsequently amended by 13 individual amendments.  Pursuant to the
Agreements, Fionda, acting as an authorized sales representative,
sells certain services offered by the Debtors to end-users and
receives commissions from the Debtors based on a percentage of the
amount billed to end-users. Fionda sells different types of
services offered by the Debtors under each of the Agreements.

On May 19, 2003, Ms. Goldstein reports that Fionda and MCI entered
into a similar third agreement, pursuant to which Fionda is
authorized to sell MCI telecommunications products and services to
end-users, including "The Neighborhood" products. Similar to the
Agreements, Fionda receives commissions from MCI based on a
percentage of the amount billed to end-users procured under the
Postpetition Agreement.  In addition, the Postpetition Agreement
establishes a minimum sales requirement for Fionda, so that Fionda
is required to procure a minimum number of orders that result in
provisioning of new products and services.  If Fionda does not
meet this minimum sales requirement, MCI will deduct a one-time
charge from Fionda's commission.

As the Postpetition Agreement was executed in the ordinary course
of business after the Petition Date, MCI is not seeking to assume
this agreement.  Pursuant to the 14th Amendment, however, if the
Agreements are not assumed by MCI, Fionda has the option to
terminate the Postpetition Agreement.

On May 19, 2003, Ms. Goldstein informs the Court that Fionda and
MCI entered into the 14th amendment to the Association Agreement.
Pursuant to the 14th Amendment, MCI agreed to file a motion
seeking approval of the assumption of the Association Agreement
as amended by the 14th Amendment and the Representation
Agreement.

The 14th Amendment to the Association Agreement provides, inter
alia:

    A. Term: The term of the Association Agreement, as amended
       by the 14th Amendment, will expire on September 30, 2003
       and will not automatically renew for any period beyond the
       Termination Date.

    B. Cure Amount: The Debtors will pay to Fionda $2,722,966.13
       as cure in full and complete satisfaction of any and all
       amounts owing under the Association Agreement and the
       Representation Agreement.

    C. Cure of Defaults: After payment of the Cure Amount, the
       Association Agreement, as amended by the 14th Amendment,
       and the Representation Agreement will be deemed cured in
       all respects.  If, however, the Court does not grant this
       Motion, or if the Debtors fail to pay the Cure Amount by
       August 15, 2003, then the 14th Amendment or the
       Postpetition Agreement, or both, will at the option of
       Fionda, be null and void.

By this Motion, the Debtors seek entry of an order approving the
assumption of the Association Agreement, as amended by the 14th
Amendment and the Representation Agreement.

Ms. Goldstein insists that the Agreements are beneficial to the
Debtors' estates in a number of ways.  Fionda is one of the
Debtors' largest and most specialized sales representatives,
providing the Debtors with over 225,000 active long distance
customer lines and significant monthly revenues.  Fionda's
clients include some of the largest entities in the affinity,
membership, retail, and direct sales industries.  Fionda's
experience and its ability to reach the large Customer Base
provides a significant benefit to the Debtors for selling their
products and will allow for substantial expansion of sales of
"The Neighborhood's" combined local and long distance products.

Ms. Goldstein tells the Court that it is WorldCom's and Fionda's
intention that the document governing the parties' relationship
will be transitioned from the Agreements to the Postpetition
Agreement.  Following this transition, Fionda will continue to
market the Debtors' products and services, including, most
significantly, "The Neighborhood" products.  The assumption of
the Agreements will ensure that Fionda will maintain the Customer
Base as the parties' transition to the Postpetition Agreement and
provide an even broader customer base to which Fionda will market
"The Neighborhood" products.

Pursuant to the Agreements and the Postpetition Agreement, Fionda
may not market the products of any other telecommunications
company to the Customer Base.  The assumption of the Agreements
and the minimum sales requirements in the Postpetition Agreement
will ensure that one of the Debtors' largest sales representatives
will continue to market only their products and services.

The Debtors believe that the amount outstanding under the
Agreements is $2,722,966.13.  Fionda asserted in its timely proof
of claim that the amount outstanding under the Agreements exceeds
$2,860,000.  In the context of this settlement, however, the
Debtors and Fionda have agreed to a $2,722,966.13 cure payment,
resulting $137,000 in savings for the Debtors, in full and
complete satisfaction of all amounts owing under the Agreements.

Ms. Goldstein asserts that the Association Agreement, as amended,
and the Representation Agreement are critical assets of the
estate, which benefit the Debtors by generating significant
revenues, ensuring the extensive marketing of "The Neighborhood"
products, and maintaining the exclusivity of over 225,000
customer lines. (Worldcom Bankruptcy News, Issue No. 32;
Bankruptcy Creditors' Service, Inc., 609/392-0900)


* Dewey Ballantine Adds Partner Lawrence M. Hill to NY Office
-------------------------------------------------------------
Dewey Ballantine LLP, a leading international law firm, announced
that Lawrence M. Hill has joined the Firm as a partner in the Tax
Group in its New York office.

Mr. Hill, formerly a partner of White & Case LLP, is one of the
nation's leading tax litigators. He has represented many of the
international accounting firms in litigation and risk management
matters and is at the forefront of defending the IRS's tax shelter
promoter penalty investigations against professional service firms
and financial institutions.

His practice also includes representation of banks, investment
banks and major corporations in a number of tax cases involving
complex financial products. In addition, he has litigated federal
and state tax cases involving issues such as transfer pricing,
corporate structurings, estate and gift taxation, partnerships,
tax accounting, civil and criminal tax fraud, penalties,
individual taxation and constitutional law.

Accounting Today Magazine named Mr. Hill one of the "Top 100 Most
Influential People in the Accounting Profession" in 1998, 1999 and
2000.

Mr. Hill recently won a high-profile case for a former Big Five
accounting firm. In the landmark case, he convinced a district
court in a summons enforcement action to uphold the right of the
accounting firm's clients to preserve their anonymity under the
accountant-client privilege under section 7525.

"Larry Hill's proficiency in complex litigation as well as in
strategic and risk management consultation adds depth and
expertise to our Firm-wide Tax Group," said Everett L. Jassy,
chairman of Dewey Ballantine's Management Committee. "The IRS
continues to increase its scrutiny of complex tax issues and Larry
will be an excellent resource for both current and future clients
in dealing with these matters."

"I am delighted to join Dewey Ballantine, a Firm with rich
tradition and depth in the tax practice area," said Lawrence Hill.
"I look forward to continuing my career with the Firm's top-
caliber attorneys and working with its exceptional client base."

Graduating Phi Beta Kappa from State University of New York at
Binghamton, Mr. Hill holds a J.D. and LL.M. in taxation from
George Washington University National Law Center. Mr. Hill is vice
chair of the Court Procedure and Practice Committee of the Tax
Section of the American Bar Association and chair of the
Subcommittee on Tax Shelters of its Administrative Practice
Committee.

Dewey Ballantine's tax department is among the largest of any
general practice law firm, with 21 tax partners, one counsel and
more than 30 tax associates practicing the full spectrum of
corporate tax work in offices in New York, Washington, D.C., Los
Angeles, London and Warsaw. The principal areas of practice
include transactional tax, international tax, lease financing,
financial products, tax controversy, legislative and employee
benefits. A major part of Dewey Ballantine's tax practice involves
large-case tax controversy work. The Firm represents U.S. and
foreign corporate taxpayers at the audit and appeals stages before
the IRS, and in tax litigation in the Federal courts -- from the
United States Tax Court to the Supreme Court of the United States.

Dewey Ballantine LLP, founded in 1909, is an international law
firm with more than 550 attorneys located in New York, Washington,
D.C., Los Angeles, Palo Alto, Houston, Austin, London, Warsaw,
Budapest, Prague and Frankfurt. Through its network of offices,
the firm handles some of the largest, most complex corporate
transactions and litigation in areas such as M&A, bankruptcy,
capital markets, private equity, antitrust, intellectual property,
structured finance, project finance, international trade and
international tax. Industry specializations include energy and
utilities, healthcare, insurance, media, consumer and industrial
goods, technology, telecommunications and transportation.


* Fried Frank Elects Three New Partners at New York Headquarters
----------------------------------------------------------------
Fried, Frank, Harris, Shriver & Jacobson announced that Eric
Feuerstein, David Hennes and Vivek Melwani have been elected to
the partnership, effective September 1st. All three lawyers
practice in the Firm's New York headquarters.

Commenting on the announcement, Co-Managing Partner Valerie Ford
Jacob said, "We are all very excited and proud to have these
colleagues, who have dedicated themselves to Fried Frank over the
years, as partners of the Firm."

Co-Managing Partner Paul Reinstein added, "We expect Eric, David
and Vivek to take strong leadership positions in our Firm as we
grow in the years ahead. "Eric M. Feuerstein, 34, joined the Firm
in 1996. He earned his Juris Doctor at the Benjamin N. Cardozo
School of Law in 1995 and his Bachelor of Arts cum laude at
Cornell University in 1991.

Mr. Feuerstein specializes in real estate law. He has worked in
the areas of acquisitions, leases, ground leases, joint ventures
and financings with such clients as Brookfield Financial
Properties, Jack Resnick & Sons, Inc., Macklowe Properties, Inc.,
Reckson Associates Realty Corp., RFR Properties LLC and Tishman
Speyer Properties.

David B. Hennes, 32, joined Fried Frank in 1996. He earned his
Juris Doctor at the University of Pennsylvania Law School in 1995
and his Bachelor of Arts with high distinction at the University
of Michigan in 1991. Mr. Hennes was a law clerk to the Hon. Jerome
B. Simandie, U.S. District Judge in New Jersey, from 1995 to 1996.

Mr. Hennes practices in the areas of civil litigation and white-
collar and enforcement litigation. Among his many representations
was his defense of the former CEO of McKesson Corp. in connection
with a civil securities litigation arising from an earnings
restatement that followed McKesson's acquisition of HBO & Co.

Vivek Melwani, 31, joined the Firm in 1995. He earned his Juris
Doctor with distinction at the Hofstra University School of Law
and his Bachelor of Business Administration in 1992 also at
Hofstra University.

Mr. Melwani practices in the area of bankruptcy and restructuring.
His representations have included the unofficial committee of
bondholders and the official committee of unsecured creditors in
Conseco, Inc., the third-largest Chapter 11 case in history, and
the unofficial committee of bondholders in the restructuring of
NTL, Inc. with respect to more than $11 billion of debt.

Fried, Frank, Harris, Shriver & Jacobson is an international law
firm with approximately 500 attorneys in offices in New York,
Washington, DC, Los Angeles, London and Paris. It handles major
matters involving, among other things, corporate transactions,
including mergers and acquisitions and financings; litigation;
real estate; antitrust counseling and litigation; bankruptcy and
restructuring; benefits and compensation; environmental law;
insurance; intellectual property and technology; securities
regulation, compliance and enforcement; tax; and trusts and
estate.


* 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.

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

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

                *** End of Transmission ***